Archives For Oklahoma

Three Sentenced for Scheme to Take Home Ownership w/out Consent

Stephanie Abbott —  November 17, 2022 — Leave a comment

Laura R. Johnson, 47, Thomas Johnson, Sr., 54, and Cheryl M. Ashley, 72, all residents of Oklahoma City, Oklahoma, were sentenced earlier this week, collectively to more than 21 years in federal prison for conspiracy to commit mail and wire fraud in connection with a scheme to take ownership of more than a dozen real properties without the consent or knowledge of the actual owners.

Public records reflect that the defendants used fraudulent documents from 2014 until 2019 to obtain titles to homes and other properties.  The defendants primarily targeted real properties that had delinquent property taxes and therefore were subject to being auctioned by the Oklahoma County Treasurer’s Office.  By paying off one or more years of back taxes, the defendants caused the properties to be removed from the county tax auction.  The defendants then claimed they had purchased the properties at the county tax auction, when in fact they had filed fraudulent warranty deeds to transfer properties into the names of fictitious companies and individuals.  The conspiracy also included fraudulent confidential stamp tax affidavits and fake mortgages, all of which contained forged notary signatures and seals.

Some homeowners vacated their homes based on phony eviction notices.  When certain victims fought the takeover of their homes in court, the defendants filed pleadings with the names of fictitious lawyers and submitted affidavits in court signed by fictitious people.

The defendants targeted one home that had been owned by a woman who died in 2012.  After they gained control of the decedent’s property, the defendants used bank records they found in the home and forged a power of attorney to lie to the bank in an attempt to withdraw more than $100,000 from the decedent’s bank account.  When that attempt failed, the conspirators attempted to steal money by writing forged checks on the decedent’s account and causing electronic transfers out of the account for their personal benefit.  They also filed a false will in Oklahoma County District Court after the woman’s nephew learned of the death and filed a probate action.  Based on the fraudulent will, the court appointed Laura Johnson as the personal representative of the estate, which enabled her to withdraw approximately $146,000 remaining in the decedent’s bank accounts and obtain more than $45,000 from her oil and gas interests.

On December 19, 2019, a federal grand jury returned a 16-count Indictment against the defendants.  The federal grand jury returned a superseding indictment on June 16, 2020, which added additional charges.  On November 17, 2020, each defendant pleaded guilty to a single count of conspiracy to commit mail and wire fraud.

At sentencings earlier this week, Chief United States District Judge Timothy D. DeGiusti found the defendants’ conduct preyed on more than a dozen victims, many of whom were vulnerable due to their age or financial status.  Judge DeGiusti sentenced the defendants as follows:

  • Laura R. Johnson was sentenced on November 14, 2022, to 151 months in federal prison. This term of imprisonment will be followed by 4 years of supervised release.  She was remanded to the custody of the United States Marshal Service at sentencing.
  • Thomas Johnson, Sr. was sentenced on November 15, 2022, to 42 months in federal prison.  This term of imprisonment will be followed by 3 years of supervised release.
  • Cheryl M. Ashley was sentenced on November 16, 2022, to 60 months in federal prison. This term of imprisonment will be followed by 3 years of supervised release.

In addition, the Court will order the defendants to pay restitution to victims after a separate restitution hearing in approximately 90 days.

The announcement was made by U.S. Attorney Robert J. Troester.

This case is the result of an investigation by the United States Secret Service and the Oklahoma Attorney General’s Office.  Assistant U.S. Attorney Jessica L. Perry prosecuted the case.

Reference is made to public filings for more information.

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Former President of First Mortgage Company Sentenced for Fraudulent Schemes

Stephanie Abbott —  November 29, 2021 — Leave a comment

Ronald J. McCord, 71, Oklahoma City, Oklahoma, was sentenced this morning to serve 104 months in prison for defrauding locally-based banks, Fannie Mae, homeowners, and others through a broad range of fraudulent conduct.

On June 3, 2020, a grand jury returned a 24-count Indictment against McCord.  The charges included bank fraud, money laundering, and making a false statement to a financial institution.  McCord was the Chairman and founder of First Mortgage Company, LLC (“FMC”), an Oklahoma City, Oklahoma based mortgage lending and loan servicing company.  In May 2021, McCord pleaded guilty to five counts of that Indictment.  McCord admitted to defrauding Spirit Bank (“Spirit”) and Citizens State Bank (“Citizens”)—two state-chartered financial institutions—as well as their respective residential mortgage subsidiaries, American Southwest Mortgage Corporation (“Mortgage Corp.”) and American Southwest Mortgage Funding Corporation (“Funding Corp.”).  An independent audit discovered that McCord had sold more than $14,100,000.00 in Spirit/Mortgage Corp. and Citizens/Funding Corp. loans “out of trust” by failing to repay Spirit/Mortgage Corp. when certain Spirit/Mortgage Corp.-initiated loans were refinanced or otherwise paid off.  At the time of this discovery, FMC carried outstanding balances of about $200,000,000.00 and $140,000,000.00 on the Spirit/Mortgage Corp. and Citizens/Funding Corp. lines of credit, respectively.

Upon learning of McCord’s conduct, Spirit/Mortgage Corp. and Citizens/Funding Corp. terminated future warehouse lending to FMC, and instituted new notification requirements that required McCord to assign FMC-funded mortgages to Spirit/Mortgage Corp. and Citizens/Funding Corp., to ensure the title companies handling those mortgages sent payoffs directly to the banks.  McCord admitted at his change of plea hearing that he filed the assignments as required, but then caused the mortgages to be released on two properties—in Leland and Denver, North Carolina—after collecting the mortgage payoffs.

Spirit/Mortgage Corp. and Citizens/Funding Corp.’s refusal to fund new FMC mortgages prompted McCord to seek out a new warehouse lender.  In early 2017, McCord began negotiating with CapLOC, LLC, a North Carolina-based mortgage lending business, and offered to sell FMC’s mortgage lending business in exchange for quick funding from CapLOC.  McCord admitted that he made a materially false statement and representation to CapLOC in the course of those negotiations, in order to influence CapLOC’s actions.

Finally, in 2017, FMC serviced approximately 12,000 loans worth a total of approximately $1,800,000,000.00 for the Federal National Mortgage Association (“Fannie Mae”).  McCord admitted at his plea hearing that he defrauded Fannie Mae by diverting escrow monies intended to pay homeowners’ taxes and insurance premiums to cover FMC’s operating expenses.  McCord also admitted that he then laundered the proceeds by causing a wire transfer from FMC’s operating account to a custom home builder, as payment towards construction of McCord’s vacation home in Colorado.

The announcement was made by Acting U.S. Attorney Robert J. Troester.

“This was a carefully calculated scheme by which the defendant defrauded local banks out of tens of millions of dollars, made false statements to a financial institution, diverted escrow monies intended to pay homeowners’ taxes and insurance premiums to cover his company’s operating expenses, and then laundered the proceeds to fund his lavish lifestyle,” said Acting U.S. Attorney Troester.  “This sentence should serve as notice that those who defraud financial institutions for personal gain will be held accountable.”

McCord was also ordered to pay $51,861,806.40 in restitution to the victims of his fraudulent schemes.

At today’s sentencing hearing, the Honorable Robin J. Cauthron found that McCord caused a total loss of more than $95,000,000.00 to local banks, other financial institutions, and borrower homeowners.  Judge Cauthron heard statements from representatives of three of those victims, as well as argument from both parties, before rendering the 104-month sentence.  The Court ordered McCord to self-surrender to the Federal Bureau of Prisons on January 6, 2022 to commence his term of imprisonment.  The Court also ordered McCord to serve three years of supervised release following his term of incarceration.

This case was the result of investigations by the Federal Housing Finance Agency – Office of the Inspector General, the Federal Deposit Insurance Corporation – Office of Inspector General, and the FBI Oklahoma City Field Office.  Assistant U.S. Attorney Julia E. Barry prosecuted the case.

Reference is made to court filings for further information.

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Former President of First Mortgage Co. Pleads Guilty to False Statements to a Financial Institution

Stephanie Abbott —  May 11, 2021 — Leave a comment

Ronald J. Mccord, 70, Oklahoma City, Oklahoma pleaded guilty yesterday to defrauding two locally-based banks, Fannie Mae, and others through a broad range of fraudulent conduct over the course of three years.

McCord was the Chairman and founder of First Mortgage Company, LLC (“FMC”), an Oklahoma City, Oklahoma based mortgage lending and loan servicing company.

According to court documents and yesterday’s plea hearing, McCord admitted to defrauding Spirit Bank (“Spirit”) and Citizens State Bank (“Citizens”)—two state-chartered financial institutions—as well as their respective residential mortgage subsidiaries, American Southwest Mortgage Corporation (“Mortgage Corp.”) and American Southwest Mortgage Funding Corporation (“Funding Corp.”).  An independent audit discovered that McCord had sold more than $14,100,000.00 in Spirit/Mortgage Corp. and Citizens/Funding Corp. loans “out of trust” by failing to repay Spirit/Mortgage Corp. when certain Spirit/Mortgage Corp.-initiated loans were refinanced or otherwise paid off.  At the time of this discovery, FMC carried outstanding balances of about $200,000,000.00 and $140,000,000.00 on the Spirit/Mortgage Corp. and Citizens/Funding Corp. lines of credit, respectively.

Upon learning of McCord’s conduct, Spirit/Mortgage Corp. and Citizens/Funding Corp. terminated future warehouse lending to FMC, and instituted new notification requirements that required McCord to assign FMC-funded mortgages to Spirit/Mortgage Corp. and Citizens/Funding Corp., to ensure the title companies handling those mortgages sent payoffs directly to the banks.  McCord admitted at yesterday’s plea hearing that he filed the assignments as required, but then caused the mortgages to be released on two properties—in Leland and Denver, North Carolina—after collecting the mortgage payoffs.

Spirit/Mortgage Corp. and Citizens/Funding Corp.’s refusal to fund new FMC mortgages prompted McCord to seek out a new warehouse lender.  In early 2017, McCord began negotiating with CapLOC, LLC, a North Carolina-based mortgage lending business, and offered to sell FMC’s mortgage lending business in exchange for quick funding from CapLOC.  At yesterday’s plea hearing, McCord admitted that he made a materially false statement and representation to CapLOC in the course of those negotiations, in order to influence CapLOC’s actions.

Finally, in 2017, FMC serviced approximately 12,000 loans worth a total of approximately $1,800,000,000.00 for the Federal National Mortgage Association (“Fannie Mae”).  McCord admitted at the plea hearing that he defrauded Fannie Mae by diverting escrow monies intended to pay homeowners’ taxes and insurance premiums to cover FMC’s operating expenses.  McCord also admitted that he then laundered the proceeds by causing a wire transfer from FMC’s operating account to a custom home builder, as payment towards construction of McCord’s home in Colorado.

At sentencing, which is currently scheduled for August 9, 2021, McCord faces up to 30 years in prison and a fine of up to $1,000,000.00 on each count of bank fraud and false statement to a financial institution.  He also faces up to 10 years in prison and a $250,000.00 fine on the money laundering count.  Per the terms of his plea agreement, the government agreed not to advocate at sentencing for a sentence above 104 months.  Under the plea agreement, McCord will be ordered to pay restitution to the victims of his conduct in amounts to be determined by the court at the time of sentencing.  McCord must also forfeit proceeds of the fraudulent schemes and property involved in the offenses.  Further, as part of the plea agreement, the government will dismiss at sentencing the remaining counts of the Indictment.

On June 3, 2020, a grand jury returned a 24-count Indictment against McCord.  The charges included bank fraud, money laundering, and making a false statement to a financial institution.

The announcement was made by Acting U.S. Attorney Robert J. Troester.

This case is the result of investigations by the Federal Housing Finance Agency Office of the Inspector General, Federal Deposit Insurance Corporation Office of Inspector General, and the Federal Bureau of Investigation.  Assistant U.S. Attorney Julia E. Barry is prosecuting the case.

Reference is made to court filings for further information.

 

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Former President of First Mortgage Company Charged with Fraud

Stephanie Abbott —  June 4, 2020 — Leave a comment

Ronald J. McCord, 69, Oklahoma City, Oklahoma, was charged yesterday with defrauding two locally-based banks, Fannie Mae, and others. The charges include bank fraud, money laundering, and making a false statement to a financial institution.

McCord was the former President of First Mortgage Company, LLC (“FMC”), an Oklahoma City, Oklahoma based mortgage lending and loan servicing company.  The Indictment alleges a broad range of fraudulent conduct spanning approximately three years.

McCord is charged in Counts 1 through 7 with defrauding Spirit Bank (“Spirit”) and Citizens State Bank (“Citizens”), two state-chartered financial institutions, as well as their respective residential mortgage subsidiaries, American Southwest Mortgage Corporation (“Mortgage Corp.”) and American Southwest Mortgage Funding Corporation (“Funding Corp.”).  According to the Indictment, in approximately June 2016, an independent audit discovered that McCord had sold more than $14,100,000.00 in Spirit/Mortgage Corp., and Citizens/Funding Corp., loans “out of trust” by failing to repay Spirit/Mortgage Corp., when certain Spirit/Mortgage Corp., initiated loans were refinanced or otherwise paid off.  At the time of this discovery, FMC carried outstanding balances of about $200,000,000.00 and $140,000,000.00 on the Spirit/Mortgage Corp. and Citizens/Funding Corp. lines of credit, respectively.

According to the Indictment, this discovery prompted further internal review.  An internal audit revealed that McCord had misappropriated additional Spirit/Mortgage Corp. and Citizens/Funding Corp. loans by: (1) using FMC’s warehouse line of credit with (i.e., obtaining mortgage loans from) Spirit/Mortgage Corp. or Citizens/Funding Corp., selling those Spirit/Mortgage Corp. or Citizens/Funding Corp. loans to Fannie Mae, then resubmitting the loan documents to Spirit/Mortgage Corp. or Citizens/Funding Corp. to receive additional money from the Spirit/Mortgage Corp. or Citizens/Funding Corp. line of credit; (2) using FMC’s warehouse line of credit with Spirit/Mortgage Corp. or Citizens/Funding Corp. to refinance the resulting loans without repaying Spirit/Mortgage Corp. or Citizens/Funding Corp. the originally loaned funds; (3) using FMC’s Spirit/Mortgage Corp. or Citizens/Funding Corp. line of credit to fund mortgages to borrowers, receiving payments from those borrowers, but never repaying Spirit/Mortgage Corp. or Citizens/Funding Corp.; (4) obtaining funds from Spirit/Mortgage Corp. or Citizens/Funding Corp. for loans that never closed, then failing to return the funds to Spirit/Mortgage Corp. or Citizens/Funding Corp.; and (5) using FMC’s warehouse lines of credit with Spirit/Mortgage Corp. and Citizens/Funding Corp. to “double fund” loans by obtaining funds from both financial institutions to fund the same loans.

The Indictment alleges that McCord’s actions involved Spirit/Mortgage Corp. and Citizens/Funding Corp. loans that totaled approximately $40,000,000.00, in addition to the more than $14,100,000.00 in Spirit/Mortgage and Citizens/Funding Corp. loans that McCord had sold out of trust.

The Indictment further alleges that, upon learning of McCord’s conduct, Spirit/Mortgage Corp., and Citizens/Funding Corp., terminated future warehouse lending to FMC, and instituted new notification requirements that required McCord to assign FMC-funded mortgages to Spirit/Mortgage Corp. and Citizens/Funding Corp., to ensure that the title companies handling those mortgages sent payoffs directly to the banks.  Though McCord filed the assignments as required, his employees contacted the title companies handling the mortgages and directed payments to FMC, not Spirit/Mortgage Corp. and Citizens/Funding Corp.  McCord continued to collect loan payoffs without repaying Spirit/Mortgage Corp. and Citizens/Funding Corp.  He then signed releases on the assigned mortgages after receiving the payoffs, subjecting the properties to potential foreclosure should Spirit/Mortgage Corp. or Citizens/Funding Corp. try to collect payments on the mortgages, to which they held title.

According to Count 8 of the Indictment, Spirit/Mortgage Corp., and Citizens/Funding Corp.’s refusal to fund new FMC mortgages prompted McCord to seek out a new warehouse lender.  In early 2017, McCord began negotiating with CapLOC, LLC, a North Carolina based mortgage lending business, and offered to sell FMC’s mortgage lending business in exchange for quick funding from CapLOC.  In the course of those negotiations, McCord made false statements and representations to obtain CapLOC funds.  McCord then used the money to repay Spirit/Mortgage Corp. part of his outstanding $40,000,000.00 debt.

Finally, the Indictment alleges that, in 2017, FMC serviced approximately 12,000 loans worth a total of approximately $1,800,000,000.00 for the Federal National Mortgage Association (“Fannie Mae”).  Counts 9 through 24 of the Indictment allege that McCord defrauded Fannie Mae by diverting escrow monies intended to pay homeowners’ taxes, insurance, principal, and interest, to cover FMC’s operating expenses.  As a result, McCord bounced checks to more than sixty taxing authorities and borrowers throughout the Oklahoma City area and elsewhere missed making their tax payments.  The Indictment further alleges that McCord laundered the stolen escrow monies by using the funds to write himself checks, pay more than half the purchase price of his son’s $900,000.00 Oklahoma City home, and build a custom vacation home in Colorado.

With regard to the bank fraud and false statement to a financial institution charges in the Indictment, McCord faces up to 30 years in prison and a fine of up to $1,000,000.00 on each count.  He also faces up to 10 years in prison and a $250,000 .00 fine on to each of the money laundering counts. Furthermore, the Indictment seeks forfeiture from McCord in the amount of the proceeds of the fraudulent schemes and in the amount of the property involved in the offenses.

The announcement was made by Timothy J. Downing, United States Attorney for the Western District of Oklahoma.

This case is the result of an investigation by the Federal Housing Finance Agency Office of the Inspector General, Federal Deposit Insurance Corporation Office of Inspector General, and the Federal Bureau of Investigation Oklahoma City Field Office.  It is being prosecuted by Assistant U.S. Attorney Julia E. Barry.

Reference is made to the Indictment and other public filings for further information.  An indictment is only a charge and is not evidence of guilt.  A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.  To download a photo of U.S. Attorney Downing, click here.

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Property Development Executive Convicted of Submitting False Invoices to Obtain Loan Proceeds

Allison Tussey —  June 1, 2015 — Leave a comment

Bruce Carlton Wright, 69, Norman, Oklahoma, was convicted following an 8-day jury trial of conspiracy and 11-counts of bank fraud. The scheme to defraud the IBC Bank of approximately $1.2 million dollars was in connection with property development.

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Former Executive Jailed for Falsifying Bank Assets

Allison Tussey —  April 13, 2015 — Leave a comment

Mark A. Nixon, 62, Freedom, Oklahoma, former Executive Vice President of The Freedom State Bank was sentenced by United States District Judge Stephen P. Friot for his involvement in falsifying bank assets to the FDIC.

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Tax Preparer Jailed for Preparing Returns Falsely Claiming First-Time Homebuyer Credit

Allison Tussey —  March 25, 2015 — Leave a comment

William David Green, Yukon, Oklahoma, was sentenced to serve 24 months in federal prison for preparing a false tax return for a client. Continue Reading…

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Real Estate Developer Sent to Prison for Stealing Investor Funds

Allison Tussey —  October 10, 2014 — Leave a comment

Steven Russell Hart, 55, Madill, Oklahoma, was sentenced to serve 33 months in prison for defrauding an investor of more than $700,000 to pay for construction that never took place, including five houses that did not exist.

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Bank Manager Sentenced for Using Stolen Identities to Obtain Loans

Allison Tussey —  August 18, 2014 — 1 Comment

Eva Barroso, 54, Broken Arrow, Oklahoma, a former manager of a credit union was sentenced to serve 27 months for each count of bank fraud and tax evasion for fabricating at least three false loans in the name of nominee entities and individuals without the knowledge and authorization of the purported borrower

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Real Estate Agent Jailed for Inflating Real Estate Prices and Paying Kickbacks

Allison Tussey —  March 28, 2014 — Leave a comment

Trina Tahir, 58, Oklahoma City, Oklahoma, has been sentenced to twenty-four months in federal prison and ordered to pay $382,290.82 in restitution for her role in obtaining fraudulent mortgage loans.

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