James Andrew Thurman, St. Charles, Missouri, former owner of Phoenix Title and James Andrew GMAC Real Estate (JAGMAC) was sentenced by a Missouri federal court to 63 months in prison and was ordered to pay over $2 million to the victims of a $2 million mortgage fraud scheme.

Thurman pled guilty to one felony count of wire fraud in August 2005.

At the sentencing, ten victims explained to United States District Judge Catherine D. Perry the devastation Thurman’s fraud caused in their lives.

"The testimony of these victims was heart wrenching. People lost their homes, their life savings, some now owe two mortgages, and all have suffered from the stress caused by this upheaval in their lives," said United States Attorney Catherine L. Hanaway. "These borrowers were not told that their escrow deposits were actually going to be used to cover earlier customers' loans, and that they were betting their nestegg on Phoenix Title's ability to find new customers to cover their loans."

Thurman formed Phoenix Title during 1996 and JAGMAC Real Estate during 2002. Both Phoenix Title and JAGMAC Real Estate operated from a building located at 324 N. Main Street, St. Charles, Missouri.

Between March 1, 2002, and December 2, 2004, Thurman transferred a net total of $3,444,000 of customers' escrow deposits from Phoenix Title to JAGMAC and $15,000 from customers' escrow deposits to his own personal account.

During January 2005, when Phoenix began to face the real possibility of not being able to fund its customers' loan payoffs or home purchases, Thurman directed Phoenix Title employees to delay the delivery of customers' escrow funds for ten days. During February 2005, Thurman reimbursed $225,000 of the customers' escrow funds with money he borrowed from a friend. On March 17, 2005, Thurman repaid a total of $1,900,000 with money he borrowed from his parents.

During March and April 2005, Thurman caused Phoenix Title to continue to accept escrow deposits from customers seeking to purchase or build a home, or to refinance their mortgage, omitting the material fact that Phoenix Title had a deficit of over $1.5 million in its escrow funds.

In addition to this scheme to defraud Phoenix Title's customers, Thurman defrauded First Bank of $100,000 by double-pledging the property located at 324 N. Main Street, St. Charles, Missouri.