Stanford Morgan, 44, Seminole County, Florida, president and owner of Homes for Sale by Owner, Inc., was sentenced to six years in prison after pleading guilty to a criminal racketeering scheme that involved mortgage fraud in home purchasing. Upon his release from prison, Stanford Morgan must also pay full restitution, including $200,000 to an investing couple in one transaction and compensation to the lending institutions he defrauded in other transactions.

From June 2003 through March 2004, Morgan orchestrated a series of bogus mortgage transactions in Lake and Seminole Counties, Florida. Acting with co-conspirators Nancy Mahan, 71, and William Ball, 66, Morgan recruited straw buyers to purchase homes, taking advantage of their high credit scores to obtain "no-document" loans. The sellers and buyers were shown one set of documents with the actual sale price of the home, but Morgan arranged to have a different set of documents sent to the mortgage lending institutions indicating a much higher sale price. Morgan pocketed the difference.

Morgan promised to handle all of the payments for the homes and assured the buyers that they would see a profit when the homes increased in value. The buyers weren't aware that the homes had been burdened with mortgages far in excess of their value. In the 12 sales transactions that were part of the prosecution's case, Morgan diverted hundreds of thousands of dollars to himself, leaving the buyers stuck with the overpriced mortgage payments.

Morgan's prison sentence was handed down by Lake County, Florida, Circuit Judge Mark J. Hill. Co-defendant Nancy Mahan, convicted of conspiracy to commit racketeering, and co-defendant William Ball, convicted of grand theft, are both serving probationary sentences for their involvement in the scheme. The case was investigated by the Office of Financial Regulation. The Lake County Sheriff's Office and the Department of Financial Services Divisions of Insurance Fraud and Agents and Agency Services assisted in the investigation.