Mortgage Fraud Blog is the premier website for news and information on mortgage fraud and real estate fraud throughout the United States.
Rachel Dollar, the editor of Mortgage Fraud Blog, is an attorney and Certified Mortgage Banker who handles litigation for lending institutions and secondary market investors. She is an author and a nationally recognized speaker on the topic of mortgage fraud. Ms. Dollar is a shareholder with the law firm of Smith Dollar, PC, is licensed to practice law in California and maintains offices in Santa Rosa, California. Email Ms. Dollar
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Mortgage Fraud Conspiracy Ring Leader Pleads Guilty
Raymond Walter Zwego, Jr., 59, Kansas City, Missouri, pled guilty to all of the charges contained in a January 4, 2007, federal indictment. Zwego owns and operates Xpress Car Sales, Xpress Car Rental, North Mission Investments, Cobalt Blue, LLC, and Indigo Blue in North Kansas City.
Zwego admitted that, from early September through November 17, 2006, he participated in a conspiracy to defraud Fieldstone Mortgage Corporation. Zwego, the organizer and leader of the mortgage fraud scheme, also pleaded guilty to 11 counts of wire fraud.
Zwego admitted that he conspired with others to obtain financing to purchase a residential property at 5034 Sunset Drive, Kansas City, Missouri, at an inflated price in order to obtain loan proceeds in excess of the actual sale price. According to Zwego, co-conspirators falsely represented to Fieldstone Mortgage that the sale price was $1.2 million, while in reality, the actual sale price was $707,000. According to Zwego, co-conspirators sought to obtain a loan to purchase the property through a fraudulent loan application and other fraudulent documents.
Zwego admitted to sending, or causing to be sent, fraudulent documents in a series of facsimiles and an e-mail in furtherance of the conspiracy.
Zwego is the seventh defendant to plead guilty to participating in the mortgage fraud conspiracy.
On June 27, 2007, Michael Rodd, 53, Olathe, Kan., pleaded guilty to his role in the mortgage fraud conspiracy. Rodd is a real estate broker doing business as Heartland of America, Inc., in Olathe.
Rodd’s role in the conspiracy was to act as the real estate agent in connection with the sale and purchase of the Sunset Drive property. He obtained a listing agreement for the residence, purportedly found the buyers, and otherwise acted as the real estate agent for the transaction. He attended a meeting of co-defendants (including Zwego) at which they agreed that an inflated appraisal would be obtained, and then the sale price would be inflated and a false management fee added to the Settlement Statement (to be submitted to the lender), with Zwego taking the difference.
Larry E. Barshaw, 57, and Linda M. Thompson-Barshaw, 58, Kansas City, Kansas, were recruited as straw buyers, posing as purchasers of the Sunset Drive property. In reality, the Barshaws never intended to reside at the residence or to make payments on the mortgage. They were to be paid $40,000 for their role in the conspiracy. Thompson-Barshaw is the owner of Colormarc, Inc., a remodeling business that employed her husband, LarryBarshaw. The Barshaws pleaded guilty on May 25, 2007, to their role in the conspiracy and to wire fraud.
On May 21, 2007, co-defendants James E. Coleman, 59, and James R. Rhoades, 48, both of Kansas City, pleaded guilty to their roles in the mortgage fraud conspiracy. Coleman, a Certified Public Accountant who formerly served as president of the board of a Kansas City magnet school, also pleaded guilty to four counts of wire fraud. On May 14, 2007, co-defendant Jeremy A. Plagman, 29, of Lee’s Summit, an appraiser doing business as JET Appraisals in Lee’s Summit, pleaded guilty to his role in the conspiracy.
Plagman provided an inflated appraisal of $1.2 million for the property at 5034 Sunset Drive. Coleman’s role in the conspiracy was to prepare and provide a number of fraudulent letters for the Barshaws attesting to their credit worthiness. These letters and the inflated appraisal were submitted to Fieldstone Mortgage as part of the loan application to purchase the property. Rhoades’ role in the conspiracy was to assist Zwego in obtaining documents needed for the transaction, to prepare and submit false documents as needed, and to contact co-conspirators as needed.
The Barshaws and Coleman also admitted to wire fraud by acknowledging their responsibility for a facsimile transmission of signed closing documents relating to the sale and purchase of the property that was sent to Fieldstone Mortgage on November 17, 2006.
Additionally, Coleman also admitted that, on three separate occasions in October and November 2006, he committed wire fraud by transmitting facsimiles of fraudulent documents in furtherance of the conspiracy.
Under federal statutes, each of the co-defendants could be 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, on the conspiracy charge. Zwego, the Barshaws and Coleman could also be subject to a sentence of up to 20 years in federal prison without parole, plus a fine up to $250,000 and an order of restitution, on each of the wire fraud charges. Sentencing hearings will be scheduled after the completion of presentence investigations by the United States Probation Office.
There sure was not much of an emphasis or info on Jeremy Plagman(Jet Appraisals), the appraiser.......or on what the appraiser faces for charges........it makes me crazy!
None of this could have happened WITHOUT the appraisal right? IMHO, the appraiser should be facing charges equal to the others.......the appraiser is just as much of a “Fraudster” as any of the aforementioned parties!
Failed Mortgage Firm Trustee Allowed $50,000 in Fees Union Leader
U.S. Bankruptcy Court Judge J. Michael Deasy will approve $50,000 in legal fees for the trustee of failed mortgage brokerage businesses Financial Resources Mortgage Inc. and CL&M Inc.
Bend Oregon Event to Help Homeowners Prevent Foreclosures Oregon.Gov
As part of an ongoing effort to help homeowners avoid foreclosure, state agencies are organizing a foreclosure-prevention event in Bend on Saturday, March 27, 2010.
Shelbyville Man Gets 2-Year Sentence For Loan Fraud Chattanoogan.Com
Prosecutor Gary Humble said the lost was approximately $2.3 million in the mortgage fraud involving hundreds of homes in the Shelbyville area.
Lend America, VP Ashley Banned from FHA Housing Wire
Michael Ashley, the embattled former vice president of Federal Housing Administration (FHA)-backed mortgage originator Lend America, and the company he worked for, were permanently banned from doing business in the industry last week.
Countrywide Tries to Pin Blame on Insurer Court House News
Countrywide Home Loans demands $111 million from Triad Guaranty Insurance, claiming Triad is trying to blame mortgage lenders for the insurer's role in the housing bubble and collapse.
Investors Say They Were Swindled in Property Scheme Fox 13 Now
Utah Division of Consumer Protection is joining forces with a few investors who claim they have been cheated by an agency called "Utah Mini Ranches.
Greenfield Man Accused of Housing Scam The Republic
A former real estate agent conned at least eight people by renting them properties actually owned by a federal agency and then running off with their deposits, prosecutors said.
Appraisal Institute Opposes Obama Administration's Plan for Homeowner 'Short Sales' PR News Wire
Citing concerns about increased mortgage fraud, four organizations representing more than 35,000 real estate appraisers today voiced their opposition to changes to an Obama administration program that will encourage "short sales" of homes.
Ownership Rights to Get Another Look TBO.Com
State lawmakers may beef up protections of property owners' rights by rewriting a law this spring that is at the center of a case of alleged fraud in Pasco County.
Thursday, February 18, 2010 F. Jeffrey Miller Trial Continued Testimony
As reported by Anne Mitchell, who viewed the trial:
Angela Parenza worked for Jeff Miller as the office manager for 7 or 8 years beginning in 1998. Parenza was indicted along with Miller and pled guilty to conspiracy to commit bank fraud and money laundering. Parenza testified that Miller or his contractors allegedly preferred to build all the...
Wednesday, February 10, 2010 F. Jeffrey Miller Trial Coverage Continued - Witness Testimony
Steve Middleton Testimony - Coverage Provided by Anne Mitchell
The Government continued in its cross examination of Steve Middleton. He was shown several HUD-1 statements involving sales of homes located in Overland Park, KS, and Olathe, KS. The HUD statements each allegedly showed line items of payments to (James) Moser & Associates, LLC's...
Monday, February 01, 2010 F. Jeffrey Miller Trial Coverage - Continued Witness Examination
According to Anne Mitchell, who is present in court for the trial:
Next Witness: Kelly Sanford
Kelly Sanford of the Federal Reserve was a short witness for the Government. Sanford manages electronic payments between banks and member financial institutions. He was shown copies of wire transfers and asked whether they coincided with the counts in...
Wednesday, January 27, 2010 F. Jeffrey Miller Trial - Prosecution Witnesses Continued
According to Anne Mitchell, who is viewing the trial:
January 13, 2010
Witness: Rick Hayes
Rick Hayes testified that on the day that he closed on his Miller Enterprise home, he received a phone call from the Kansas Banking Commission informing him that his loan was fraudulent. After the Hayes responded to a classified ad, they met with John...
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The information and notices contained on Mortgage Fraud Blog are intended to summarize recent developments in mortgage fraud cases and mortgage banking matters nationwide. The posts on this site are presented as general research and information and are expressly not intended, and should not be regarded, as legal advice. Much of the information on this site concerns allegations made in civil lawsuits and in criminal indictments. All persons are presumed innocent until convicted of a crime. Readers who have particular questions about mortgage banking, mortgage fraud matters or who believe they require legal counsel should seek the advice of an attorney. The creators, editors and sponsors of Mortgage Fraud Blog do not intend to create a confidential relationship or an attorney-client relationship by communication via or arising from this site.
Rachel Dollar, the editor of Mortgage Fraud Blog, is an attorney and Certified Mortgage Banker who handles litigation for lending institutions and secondary market investors. She is an author and a nationally recognized speaker on the topic of mortgage fraud. Ms. Dollar is a shareholder with the law firm of 
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