David Saks: FORMER LEE'S SUMMIT REAL ESTATE AGENT SENTENCED FOR MORTGAGE FRAUD CONSPIRACY, MONEY LAUNDERING $12.6 MILLION SCHEME INVOLVED NEW, UPSCALE HOMES IN LEE'S SUMMIT, RAYMORE

David Saks - Real Estate Broker - The Real Estate Mart of Tennessee, Inc. - 4040 North Watkins-Suite #4 - Memphis, Tennessee 38127 - Phone (901) 357-4663

FORMER LEE'S SUMMIT REAL ESTATE AGENT SENTENCED FOR MORTGAGE FRAUD CONSPIRACY, MONEY LAUNDERING $12.6 MILLION SCHEME INVOLVED NEW, UPSCALE HOMES IN LEE'S SUMMIT, RAYMORE

Former Lee’s Summit Real Estate Agent Sentenced for Mortgage Fraud Conspiracy, Money Laundering
$12.6 Million Scheme Involved New, Upscale Homes in Lee’s Summit, Raymore

U.S. Attorney’s Office October 03, 2011
  • Western District of Missouri (816) 426-3122
 
KANSAS CITY, MO—Beth Phillips, United States Attorney for the Western District of Missouri, announced that a former Lee’s Summit, Mo., real estate agent was sentenced in federal court today for her role in a $12.6 million mortgage fraud conspiracy that involved 25 upscale residential properties in Lee’s Summit, Mo., and Raymore, Mo.

Angela R. Clark, 42, of Lee’s Summit, was sentenced by U.S. Chief District Judge Fernando J. Gaitan to 20 months in federal prison without parole.

The court also ordered Clark to pay $5,634,747 in restitution.

Clark was a real estate agent and co-owner of Centsable Business Services.

She sold new homes for builder Jerry R. Emerick, 41, of Raymore, in the Raintree and Belmont Farms subdivisions in Lee’s Summit and the Eagle Glen subdivision in Raymore.

Clark and Emerick are among 19 defendants who have pleaded guilty and been sentenced in the mortgage fraud scheme that lasted from February 2005 through May 2007.

All of the fraudulent loans went into default and were foreclosed.

The government alleges in court documents that the impact of the scheme on the neighborhoods and communities was devastating, as homes sat vacant without being maintained. Lawns were not mowed and property values deteriorated. There were multiple foreclosures in the neighborhoods, and legitimate homeowners were unable to sell their properties, while at the same time, property tax assessments increased due to the falsely inflated sales prices. The properties were eventually sold post-foreclosure to third parties, with a net loss of more than $5.6 million.

Clark orchestrated the mortgage fraud scheme, which also involved two mortgage loan officers and 15 straw buyers who purchased homes at inflated prices. Buyers obtained mortgage loans for more than the actual sale price by providing false information to mortgage lenders. The buyers, without the lenders’ knowledge, then kept the extra loan proceeds. These kickbacks were paid by submitting false invoices to the title companies, which showed payment was due to business entities that, in reality, were shell companies created by co-conspirators in order to conceal the fact that the buyers were receiving cash back from the loan proceeds. Buyers received kickbacks of about $100,000 on each house.

Clark knew that loan applications and supporting documentation that contained material false information would be submitted to mortgage lenders, and Clark submitted false documentation and made fraudulent material representations to title companies.

Emerick owned and operated Ty Construction and Residential Contracting, LLC, which was engaged in the business of residential construction, primarily in Lee’s Summit and Raymore. He was sentenced to two years and six months in federal prison without parole after pleading guilty to conspiracy to commit mortgage fraud and wire fraud and to transfer funds obtained by fraud across state lines.

In total during the course of the conspiracy, mortgage lenders approved loans for 25 homes totaling more than $12.6 million.

From that total, buyers received more than $2.3 million without the lenders’ knowledge. Clark received commissions and other payments from the inflated prices totaling $405,197.

According to court documents, Clark engaged in a similar mortgage fraud scheme with six other properties that are not part of this conspiracy, shortly before and during the same time frame as the conspiracy. The government contends that Clark received an additional $168,361 in commissions and other payments from those fraudulent purchases.

This case was prosecuted by Senior Litigation Counsel Linda Parker Marshall and Assistant U.S. Attorney Kathleen D. Mahoney. It was investigated by the Federal Bureau of Investigation and IRS-Criminal Investigation.

Courtesy FBI

 




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Comment balloon 4 commentsDavid Saks • October 05 2011 02:26AM

Comments

David, I met her once! Years ago, while showing one of those new build projects. The buyer and I felt uncomfortable around her but attributed it to our different tastes in personal appearance, not necessarily dishonesty.

Posted by Maria Morton, Kansas City Real Estate 816-560-3758 (Platinum Realty) over 8 years ago

Hey David, really sad to hear but mortgage fraud has happened more than we know.  My heart goes out to the legit homeowners impacted by the mess.  Thanks for posting!

Posted by Jordon Wheeler, J W Group Real Estate Sales and Service (The Jordon Wheeler Group) over 8 years ago

Understood, Maria. I work in blue jeans and t shirts with the occasional baseball cap and it makes a member or two unconfortable once in a while, although they've pretty much gotten used to me after all these years gone by with little change in fashion. Consistency breeds familiarity. Like Woody Allen's glasses. I attend the board meetings dressed like that most of the time and play the piano during the breaks, or wear camouflaged bermuda shorts. But it gives me an edge. Most everyone thinks I'm retired, single, harmless to competition and don't need the money anymore.

Posted by David Saks ((retired)) over 8 years ago

It demonstrated clearly how property tax assessments are impacted by the fraud, Jordan. I've been trying to tell people about how this misrepresentation of fair market value can wreck the economy for twelve years now. Nobody paid any attention to me.

Here's a blog post I wrote a while back that explains one trick in the hat the assessors can use to slam homeowners with higher taxes. Click here.

Posted by David Saks ((retired)) over 8 years ago

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