Harold Stafford, 43, Sumner County, Tennessee has been sentenced to serve eight years of imprisonment for conviction on fifty-one counts of conspiracy, wire fraud, bank fraud and money laundering. As previously reported on Mortgage Fraud Blog, Stafford and two co-defendants; Miles Jackson Black and Jeffrey Dunn Hathcock were indicted in November of 2007.
Stafford was convicted in February 2009, after a six-day jury trial. According to testimony at the trial, Stafford engaged in a mortgage fraud scheme that involved the purchase of twenty-two luxury homes in Hendersonville, Gallatin and Goodlettsville by unqualified straw buyers. Miles Black and Jeffrey Hathcock, previously pleaded guilty and testified at the trial of Stafford. Black (judgment) and Hathcock (judgment) were each sentenced to a year and a day in prison, followed by 5 years of supervised release. Each of the three defendants were also ordered to pay joinly, restitution in the amount of $1,000,773.49 to mortgage lenders who were the victims of this scheme and a special assessment of $5,100. Mr. Stafford also was ordered to serve a three-year period of supervised release following his imprisonment.
Stafford, Black and Hathcock caused the submission to mortgage lenders of false mortgage loan applications that overstated the straw buyers’ income, falsely stated that the homes would be the straw buyers’ primary residences, and failed to disclose other recent home purchases by the same straw buyers. All of these mortgage loans ended in default and foreclosure, resulting in losses to mortgage lenders, after foreclosure, totaling approximately $2,214,700.
This case was investigated by the Internal Revenue Service – Criminal Investigations, the United States Secret Service, and the 18th Judicial District Drug Task Force. The prosecution of this case is being supervised by James A. Zerhusen, United States Attorney for the Eastern District of Kentucky. The United States is represented in the case by Assistant United States Attorneys Byron Jones and John Webb.