Woman Sentenced for Loan Application Misrepresentations
Belinda Cheri McKinney, 43, metro-east, Illinois, was sentenced on December 13, 2011, in the United States District Court in East St. Louis, to 37 months imprisonment for participating in a conspiracy to defraud the United States and evade the payment of federal income taxes and for making false statements on a mortgage loan application.
As previously reported by Mortgage Fraud Blog, the McKinney brothers owned and operated McKinney Hauling, a construction business located in East St. Louis, Illinois. In 2003, the Internal Revenue Service (IRS) began pursuing the brothers for unpaid taxes. The McKinney brothers evaded the payment of their tax obligations for the tax years 1999-2000, and 2002-2006, by diverting business income from McKinney Hauling into nominee bank accounts, which were used to pay personal and household expenses. Robert and John McKinney also admitted lying to federal officials about their business income and their home addresses. Belinda and Chamethele McKinney each pled guilty to falsifying mortgage loan documents while purchasing real estate - solely in their own names - so that business income earned by the husbands could be diverted into assets owned exclusively by their wives, thereby avoiding a combined IRS tax lien of $2,465,089.74, including penalties and interest.
On her loan application to purchase a house on Autumn Oaks Drive, Maryville, Illinois, Belinda McKinney indicated that she was employed at McKinney Hauling, she was a full-time employee there for ten years, and she made $9,500 a month; all of which were false and misled the lender.
Knowing that her husband Robert Todd McKinney had tax liens and poor credit, Belinda McKinney submitted the loan applications in her own name only. After closing, Belinda received a kickback of $49,990 from the seller, an amount above the actual cost of the house. The nominee account of Delta Construction, which Belinda McKinney opened, was used to make the mortgage payments.
At sentencing, a special agent of the IRS testified that Belinda McKinney also filed tax returns separately from her husband but lied about being the "head of the household," reserved for unmarried taxpayers, and misled the IRS by minimizing the household income so that she could obtain a tax refund for purported earned income credit.
Belinda Cheri McKinney was also sentenced to 3 years of supervised release, ordered to pay restitution in the amount of $952,705.52 to the Internal Revenue Service, and ordered to pay $200 as a special assessment to the court.
On December 2, 2011, her husband Robert Todd McKinney and her brother-in-law John Quinn McKinney were both sentenced to 57 months imprisonment. The sentencing for Chamethele McKinney, wife of John Quinn McKinney, is set for December 21, 2011.
The United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced the sentence.
The investigation was conducted by agents from the Internal Revenue Service, the Federal Bureau of Investigation, the U.S. Postal Inspection Service, and the Illinois Department of Healthcare and Human Services. The case is being prosecuted by Assistant United States Attorneys Liam Coonan and Steven D. Weinhoeft.
Courtesy Mortgage Fraud Blog