California Woman Pleads Guilty to Credit History Fraud That Led to $2.7 Million Lee’s Summit Mortgage Fraud Scheme
| U.S. Attorney’s Office October 19, 2011 |
KANSAS CITY, MO—Beth Phillips, United States Attorney for the Western District of Missouri, announced that a California woman pleaded guilty in federal court today to her role in a credit history fraud that contributed to a nearly $3 million mortgage fraud scheme in Lee’s Summit, Mo.
Karen Washam-Hawkins, 49, of Carson, Calif., pleaded guilty before U.S. Chief District Judge Fernando J. Gaitan to conspiracy to commit wire fraud and interstate transportation of money obtained by fraud. The Aug. 4, 2010, federal indictment marked the first time nationwide that the suppliers have been charged in a credit history fraud case.
Washam-Hawkins, a real estate agent, obtained and sold false Social Security numbers to enable individuals to create false credit histories in order to deceive lenders and obtain loans. Co-defendant Gerald William Bartlett, 40, of Tampa, Fla., used his businesses to provide fraudulent account and payment information to a credit bureau to falsely enhance the creditworthiness of individuals in order for those individuals to deceive lenders and obtain loans. Bartlett pleaded guilty on March 31, 2011, to his role in the conspiracy.
Beginning in late 2004 to early 2005 and continuing through Aug. 15, 2006, several customers of Washam-Hawkins and Bartlett benefitted from the credit history fraud scheme in order to fraudulently purchase six properties in Lee’s Summit in a mortgage fraud scheme totaling $2,717,420.
Washam-Hawkins supplied Shade Jerome Howard of Anaheim,Calif., with false Social Security numbers. Howard then gave Bartlett those false Social Security numbers, along with other identity information, and requested positive credit information for those individuals in order to enhance their creditworthiness. Bartlett, using the names South Florida Management Group and Consumer Financial Group, reported false account and payment information to a credit bureau.
This scheme allowed Howard, along with Ronald E. Brown, Jr., of Gladstone, Mo., and Daryle A. Edwards of Overland Park, Kan., to enhance their creditworthiness in order to deceive lenders and obtain mortgage loans for residential properties in Lee’s Summit. Brown purchased three residential properties totaling $1,339,700. Howard purchased two residential properties totaling $1,201,000. Edwards purchased a residential property for $418,500. Howard, Brown and Edwards were charged separately; they have pleaded guilty and been sentenced.
Under federal statutes, Washam-Hawkins and Bartlett are each subject to a sentence of up to five years in federal prison without parole, plus a fine up to $250,000 and an order of restitution. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Linda Parker Marshall. It was investigated by the Federal Bureau of Investigation.