Tuesday, February 06, 2007

Mississippi Appraiser Sentenced for Role in Flipping Scheme

Edward Young, appraiser, was sentenced for his role in a multimillion-dollar mortgage fraud scheme. Young was sentenced to 42 months imprisonment and 3 years supervised release. The court reserved ruling on restitution until a later date. Young must report to prison on April 9, 2007.

Young was among 11 people charged for their alleged roles in a flipping scheme located mostly in Madison County, Mississippi. The homes� purchase prices ranged from about $200,000 up to $600,000. Five were sentenced in December 2006.

Marvin Dawson, Anthony Burroughs, Tellis McLin and Patrick McGee, all Jackson-area businessmen, and Thomas Griffin of Vidalia, La., received prison sentences ranging from 15 months to more than five years.  All five must report to prison Feb. 12.

The other defendants are:

Fransene Berry
Shane Rothery
Kelvin Brooks
Lydon Posey
Leroy Garrett

According to the complaints, the defendants were buying and selling the same property on the same day. McGee, Burroughs, Griffin, McLin, Posey and Garrett would purchase homes most of which cost from $200,000.00 to over $600,000.00. Young, Berry and Rothery provided inflated appraisals to the lenders allowing the homes to be flipped, either to unsuspecting buyers or to one of the co-conspirators participating in the scheme. Rothery was not a licensed appraiser. He used his father, William Rothery’s license to perform the appraisal.Dawson, operating as Premier Mortgage, brokered all of these loans between the lenders and the borrowers. The defendants would then divide the profits from the flip, which ranged from a few thousand dollars to several hundred thousand dollars on each property. Brooks was involved in purchasing at least one of these properties.

Based on court records, Patrick V McGee has used the following names when purchasing properties involved in the alleged scheme:  Patrick V McGee, Patrick Vashan McGee, Vashon McGee and Vashan McGee.

In addition to inflated appraisals, other fraudulent information was provided to lenders to obtain these loans, including false employment and income information, false financial information, cashier�s checks falsely reflecting that the borrower brought down payment money to the closing, and other false documents used to facilitate the loans. Most of the 15 properties involved in the complaints are in Madison County, Mississippi neighborhoods. The total amount involved in the fraud on these particular properties is approximately $6.7 million.

Properties involved:

252 Northbay Drive, Madison, MS
109 Fieldcrest Drive, Madison, MS
288 Belle Rose Circle, Madison, MS
112 Red Oak Trail, Brandon MS
904 Cardigan Cove, Madison, MS
217 Hoy Farms Drive, Madison, MS
101 Overlook Drive, Ridgeland, MS
630 Eastwyck Drive, Ridgeland, MS
136 Shelby Drive, Madison, MS
408 Autumn Oak Dr, Madison, MS
412 Eastpointe Cove, Madison, MS
108 Country Club Drive, Madison, MS

mortgage fraud

1. The real estate appraisal industry must be dismantled.  It was intentionally structured by the real estate industry to facilitate fraud.  The future belongs to AVMs (Automated Valuation Model), where adjustment values can be standardized, changes analyzed immediately and updates can be implemented uniformly in an instant. 

   The real estate industry must no longer be allowed to manipulate property values for their own gain.

   Posted by  on  02/06  at  10:50 AM