Two men were sentenced in connection with a Leeâ€™s Summit, Missouri mortgage fraud scheme alleged to have involved approximately $18M in fraudulent loans.
Anthony Long was sentenced to 2 years in prison, to run consecutively with the sentenced imposed in the companion case, following by 3 years supervised release and was ordered to pay $1,388,126.81 in restitution. Long plead guilty to wire fraud and engaging in monetary transactions on April 22, 2005.
Mitchell James Medlin was sentenced to 5 years probation and ordered to pay. $1,388,126.81 in restitution. Medlin plead guilty to wire fraud and engaging in monetary transactions on April 21, 2005.
Carl Long, the only remaining defendant, is scheduled to be sentenced on November 7, 2005.
According to the U.S. Attorney, Anthony Long and Carl Long (dbaCommunity HomeBanc, Community HomeBanc of America and First Equity Banc) developed the scheme to defraud both home buyers and mortgage lenders. Medlin, who was engaged in residential and light commercial construction and did business as M&R Construction, LLC, in Leeâ€™s Summit, Missouri, later joined the Longs in executing the scheme.
The defendants would induce individuals to purchase duplexes at Westwind Properties in Leeâ€™s Summit, Missouri, promising no down payments, expenses or obligations, including no closing costs. The defendants obtained inflated appraisals, provided false lease and rental information in connection with the appraisals and caused false listings and sales to be entered into the MLS database.
The defendants falsely indicated to lending institutions that the buyers were paying down payments and closing costs. These amounts would be absorbed in larger loans and higher sales prices. Once the borrowers were approved to purchase the homes at the higher appraised value, the co-defendants received payment for the purchased property based on a fraudulently appraised value. In some cases, buyers were paying up to 68 percent higher prices than homes were actually worth.
The scheme continued into Westvale Properties in Leeâ€™s Summit and eventually Viking
Place Properties in Independence, Missouri. Properties involved were located in Independence, Leeâ€™s Summit, Raytown and Kansas City, Missouri