Mortgage broker Joseph Michael Klingner knowingly submitted altered copies of cashier's checks and a fraudulent sale contract in support of a client's home loan application. He was indicted in September 29, 2004 in the Western District of Arkansas, along with Christi Murrah Johnson and Michael Raymond Johnson. In exchange for the Government's agreement to dismiss three counts of wire fraud, Klingner pleaded guilty to one count of aiding and abetting his clients in submitting material false statements on a loan application. Almost three months after the court accepted the guilty plea, after filing objections to the presentence report, Klingner filed a motion to withdraw his guilty plea. The district court denied the motion and sentenced Klingner to twelve months in prison and ordered him to pay restitution of $10,751.00.

Klingner appealed the sentenced claiming that he should have been allowed to withdraw his guilty plea.

A guilty plea may be withdrawn after the court has accepted it, but before the defendant is sentenced, if the defendant shows a fair and just reason for requesting the withdrawal. Once a defendant has established a fair and just reason, the court will consider other factors.

Klingner alleged he was denied effective assistance of counsel because his attorney failed to perform a basic pretrial investigation. According to Klingner, his attorney should have performed a title search on the property to show the federally insured company that funded the company did not appear on the mortgage title. However, Klingner's attorney was provided with a legal memo on the structure of the federally-insured lender and its entities rendering a title search unnecessary. Klingner also contended that his attorney should have interviewed additional witnesses and that he relied on incorrect information in pleading guilty as his attorney failed to accurately predict his criminal history score. The court rejected these arguments as there was no indication additional witnesses could have aided the defense and he was informed in his written plea agreement and verbally that he faced up to thirty years in prison. The court found that Klingner did not show a fair and just reason for withdrawing his guilty plea.

Klingner also claimed that the district court should have granted him a mitigating role reduction. Klingner asserted he was not the instigator of the scheme but was merely a conduit who did not personally alter or falsify the documents. Contrary to his assertion, Klingner personally asked the seller and his attorney to submit false forms to conceal late payments. The district court agreed that Klingner "greatly facilitated the offense as general manager of the mortgage company and that Klingner's role was "essential" to the crime's successful commission

The Eight Circuit Court of Appeals affirmed the District court sentence of twelve months in prison.

Michael Raymond Johnson pleaded guilty to making false statements and was sentenced to 21 months in prison and ordered to pay restitution of $50,377.82. Charges against Christi Murrah Johnson were later dismissed although she did plead guilty in another case to an offense concerning loan and credit applications and was sentenced to time served.