Two Blue Springs Realtors Sentenced in $11 Million Mortgage Fraud Scheme
KANSAS CITY, MO—Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that two Blue Springs, Missouri real estate agents and several co-defendants have been sentenced in federal court for their roles in an $11 million mortgage fraud scheme.
Leann Raejeana Turner, 44, of Blue Springs, was sentenced to three years in federal prison without parole on Monday, May 12, 2014. The court also ordered Turner to pay $4,912,040 in restitution.
On May 30, 2012, Turner pleaded guilty to one count of conspiracy to commit wire fraud and one count of money laundering. Turner is one of nine defendants who participated in the mortgage fraud scheme from early 2005 to August 4, 2006. Turner was a real estate agent working for a series of real estate companies during the conspiracy. Carole L. Colson, 71, formerly doing business as Carole Colson Real Estate in Blue Springs, now of Lake Worth, Florida, was a real estate agent. Bruce Q. Williams, 44, of Kansas City, Kansas, and Anthony E. Hicks, 42, of Little Rock, Arkansas, were loan officers at mortgage brokerage companies. Other co-defendants were “home buyers” who conspired to defraud mortgage lenders.
Mortgage lenders made loans of approximately $11,092,886 on 16 residential properties in Lee’s Summit, Liberty, Blue Springs, Parkville, Independence, and Oak Grove, Missouri. From that total, unbeknownst to the lenders, buyers received approximately $2,006,845 from the loan proceeds in illegal secret kickbacks. The scheme resulted in a financial loss to mortgage lenders of nearly $5 million.
The scheme involved buying and selling homes at inflated prices, obtaining mortgage loans at the inflated prices and then kicking back $100,000 of the excess loan proceeds to each of the home buyers without the lenders’ knowledge. The scheme financially benefitted all of the conspirators. Turner (the real estate agent for 15 of the 16 transactions) received commissions and sometimes hidden payments and assets; Williams and Hicks (the loan officers) received commissions from the transactions; and the home buyers received kickbacks.
Turner and Colson listed and arranged for the sale of the homes at inflated prices and solicited buyers. Misrepresentations and omissions of material facts were made to mortgage lenders in order to obtain the loans. In order to obtain the loan proceeds without the lenders’ knowledge, the buyers created fictitious businesses that issued false invoices that claimed the businesses had provided work and services for which they were entitled to receive loan proceeds.
In addition to Turner’s sentencing this week, Colson was sentenced to five years of probation (including six months of house arrest, 120 hours of community service and ordered to pay $2,291,110 in restitution); Williams was sentenced to one year and one day in federal prison (and ordered to pay $3,443,123 in restitution); Hicks was sentenced to 10 months in federal prison (and ordered to pay $953,958 in restitution); Linda Joyce Henry Johnson, 65, of Corona, California, was sentenced to five years of probation (with six months of house arrest and ordered to pay $228,744 in restitution).
James Arthur Nash, Jr., 44, and Arman Nshanian, 38, both of Corona, California, two deputies of the Los Angeles County, Californai, Sheriff’s Department, were convicted at trial on December 6, 2013, and await sentencing. They were each found guilty of conspiracy to commit wire fraud. In addition to the criminal conspiracy, Nash was convicted of four counts of wire fraud and Nshanian was convicted of two counts of wire fraud related to fax transmissions and e-mails that were sent across state lines during the mortgage application process.
Nash fraudulently purchased two residential properties in Blue Springs, Missouri. He received $100,000 from each property. Nshanian fraudulently purchased a residential property in Lee’s Summit, Missouri, and received $100,000.
Mark P. Billey, 40, of Buena Park, California, was sentenced on September 20, 2011, to two years and nine months in federal prison and ordered to pay $701,450 in restitution.
Zelda Ann Jackson, 41, of Newbury Park, California, a real estate agent, pleaded guilty to assisting her husband in the purchase of a property. A sentencing hearing is scheduled on May 28, 2014.
This case is being prosecuted by Assistant U.S. Attorney Linda Parker Marshall. It was investigated by the FBI and IRS-Criminal Investigation.
This news release, as well as additional information about the office of the United States Attorney for the Western District of Missouri, is available online at http://www.justice.gov/usao/mow/index.html.