Woman Gets 6 Years for Using Falsified Documents to Defraud Lenders

Allison Tussey —  April 1, 2015 — Leave a comment

Teresa Jean Whitten, 41, Claycomo, Missouri, who operated a real estate business, was sentenced in for her role in a $5 million mortgage fraud scheme wherein she claimed to have a program through which people could purchase houses without putting money down and could qualify and obtain mortgage loans for which they would not otherwise qualify.

The defendant was sentenced by U.S. District Judge Dean Whipple to six years in federal prison without parole. The court also ordered Whitten to pay $1,527,607 in restitution.

On Nov. 21, 2013, Whitten pleaded guilty to wire fraud, money laundering and theft of government money.

Whitten was doing business under the name Leadership to Homeownership. Whitten engaged in a mortgage fraud scheme from early to mid-2007 through Feb. 23, 2009, in which mortgage lenders loaned borrowers approximately $5,088,224. Whitten obtained in excess of $400,000 from the loan proceeds.

Whitten solicited potential buyers by advertisements, flyers, a Web site, and other means, claiming that she had a program through which people could purchase houses without putting money down and could qualify and obtain mortgage loans for which they would not otherwise qualify. Whitten’s scheme relied on false and fraudulent loan applications and supporting documents. The false and fraudulent representations and omissions included borrowers’ income, employment, assets, liabilities and intent to occupy the property as their primary residence.

Loan applications falsely claimed the borrowers were making a down payment and were bringing money to closing, when in fact the funds were supplied by Whitten. As part of the scheme, Whitten gave cash to borrowers so they could obtain cashier’s checks from their banks to take to closings. From the loan proceeds, after closing Whitten received funds both for her fee and reimbursement for the funds she advanced, none of which was disclosed to the lenders.

In addition to the mortgage fraud scheme, Whitten engaged in a Social Security fraud scheme. Whitten received $78,964 in disability insurance benefits and auxiliary payments for her children to which she was not entitled, as well as a $250 Recovery Act payment, for a total of $79,214. Whitten concealed from the Social Security Administration that she was working in real estate, doing business as Leadership to Homeownership and earning income and money as a result of that work. She concealed her income and earnings for the purpose of obtaining federally-funded benefits she knew she was not eligible to receive.

Tammy Dickinson, United States Attorney for the Western District of Missouri, announced the sentence.

This case was prosecuted by Assistant U.S. Attorney Kathleen D. Mahoney. It was investigated by IRS-Criminal Investigation, HUD – Office of Inspector General, the Social Security Administration – Office of Inspector General and the FBI.

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Allison Tussey

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