KANSAS CITY, MO—Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that the owners and operators of a Kansas City, Missouri, firm that promised to help financially strapped clients get out of debt have pleaded guilty to defrauding their clients.

John Lee Norris, 43, and Julie Tina Hatcher, 38, both of Kansas City, Missouri, pleaded guilty before U.S. District Judge Brian C. Wimes on Wednesday, May 28, 2014, to the charges contained in an April 9, 2014 federal indictment.

Norris and Hatcher operated Reaper Investment Partners (RIP) LLC; they also did business as Hydra International. In August 2011, they formed Death Productions LP, which maintained an office in Mission, Kansas, before moving to Kansas City, Missouri.

Both Norris and Hatcher pleaded guilty to participating in a conspiracy to defraud homeowners and other debtors who were in financial distress (as well as their victims’ lenders and the Federal Housing Administration) from August 2010 to June 28, 2013.

In addition to the conspiracy, Norris and Hatcher each pleaded guilty to one count of mail fraud. Hatcher also pleaded guilty to one count of Social Security disability fraud.

Norris and Hatcher recruited and targeted homeowners and others who were in financial difficulties with promises that they would be rescued from their financial problems, including foreclosure. Norris and Hatcher made promises and assurances to homeowners and other debtors that in exchange for a monthly payment RIP would stop and/or prevent the debtor from losing his or her home.

Norris and Hatcher admitted that they spent the payments received from RIP’s clients for their personal use. Dozens of client victims, as well as lenders, suffered hundreds of thousands of dollars in losses as a result of the conspiracy, including the loss of homes and vehicles. The federal indictment refers to victims from Lee’s Summit, Missouri; St. Joseph, Missouri; Gardner, Kansas; Paducah, Kentucky; and North Wales, Pennsylvania.

Even after learning of several lost homes, RIP continued to accept monthly payments for services and continued to accept new clients with promises that clients would not lose their homes.

Norris and Hatcher claimed that RIP would draft, serve, file, and record legal forms, pleadings, and other documents and would conduct necessary legal processes, contact the relevant parties, and implement administrative procedures to stop its clients from losing their home or property. When their clients contacted them and told them they had received notice that their homes were being foreclosed and that they had received eviction notices, Norris and Hatcher reassured them. Norris and Hatcher told their clients not to worry because these notices were part of the process, and RIP continued accepting payments. After several clients lost their homes, Norris and Hatcher reassured them that RIP was preparing the appeal paperwork and would likely win on appeal. RIP continued to take payments from other homeowners.

After informing law enforcement that they were no longer doing business, Norris and Hatcher continued to accept payments from at least one client and reassured at least one client that they were still working on the homeowner’s behalf. After closing RIP, they continued to accept payments.

Hatcher pleaded guilty to one count of Social Security disability fraud. Hatcher admitted that she failed to report her work activities and income while she received Social Security disability insurance benefits from August 2010 through April 2012.

Under federal statutes, Norris is subject to a sentence of up to 60 years in federal prison without parole, plus a fine up to $2 million and an order of restitution. Hatcher is subject to a sentence of up to 65 years in federal prison without parole, plus a fine up to $2,250,000 and an order of restitution. A sentencing hearing will be held on September 19, 2014.

This case is being prosecuted by Assistant U.S. Attorneys Linda Marshall and Brian P. Casey. It was investigated by the FBI, the U.S. Secret Service, the U.S. Department of Housing and Urban Development-Office of Inspector General, the Social Security Administration-Office of Inspector General, the Johnson County, Kansas District Attorney’s Office, and the Kansas City, Missouri Police Department.