Three Kansas City men involved in a property-flipping scheme including 289 fraudulent loans were sentenced to prison Wednesday and ordered to pay restitution of $21.7 million.
Three former employees of Express Mortgage — Roderick Neil Criss, Chauncey Calvert and Robert Dale Beckley — received sentences ranging from one to three years in federal prison after pleading guilty to their roles in the scheme, which racked up $19.6 million in fraudulent loans.
Bradley Schlozman, the U.S. Attorney for the Western District of Missouri, called it the largest mortgage fraud case ever prosecuted in the Western District of Missouri. The scheme involved properties in downtown and midtown Kansas City, and was led by Brent Michael Barber, 42, of Belton, Schlozman said.
Barber pleaded guilty Feb. 23 to 104 counts contained in two federal indictments involving separate schemes to defraud lenders. According to prosecutors, Barber recruited straw buyers to purchase rental properties, assuring them he would find renters and sell the properties quickly at a profit. Barber provided false information on loan documents and arranged for inflated appraisals to obtain approvals on loans borrowers might not have otherwise qualified for, prosecutors said.
In the first scheme, between May and October 1999, Barber was a client of Ameriquest Mortgage in Gladstone. He allegedly conspired with Ameriquest account executives Criss, Calvert and Avonda Nicodemus to arrange 66 fraudulent loans totaling $4 million.
A second scheme began in October 1999, when Barber, Criss and Calvert launched Express Mortgage Inc., a mortgage brokerage that gave Barber’s loans precedence. Prosecutors said that scheme resulted in 233 fraudulent loans totaling $15.6 million.
In two separate but related cases, appraisers Peggy Snodgrass and Phillip Thomas pleaded guilty to providing inflated appraisals on properties Barber sought loans for. Barber has also admitted engaging in additional fraudulent transactions involving commercial and residential properties that involved more than $2.7 million in additional losses for lenders.
Criss, 35, was a branch manager at Ameriquest Mortgage in Gladstone and president of Express Mortgage Inc. He was sentenced to three years and one month in federal prison without parole and ordered to pay $4.6 million in restitution.
Calvert, 36, was an account executive at Ameriquest Mortgage, Express Mortgage and Mid Capital Mortgage. He was sentenced to one year and six months in federal prison without parole and ordered to pay $9.1 million in restitution.
Beckley, 34, was an employee of Express Mortgage and Mid Capital Mortgage. He was sentenced to one year and one day in federal prison without parole and ordered to pay $8 million in restitution.
Nicodemus, 34, pleaded guilty and was sentenced to probation.
Barber is to be sentenced on Oct. 30. He faces up to five years in federal prison without parole for each of the two conspiracy counts, plus a fine of as much as $250,000. He also faces up to 10 years in federal prison without parole on each of 98 counts of interstate transportation of funds obtained by fraud, and each of the four money laundering counts he has been convicted of carry sentences of up to 10 years in federal prison without parole.
Under the terms of his plea agreement, Barber agreed not to appeal a jury’s guilty verdict in a third federal indictment involving his businesses KC Properties and KC Securities LLC.
On Dec. 2, 2005, a jury found Barber guilty of conspiring with Vernon David Williams to defraud MILA Inc., a Mountlake Terrace, Wash.-based lender, and Finance America LLC of Irvine, Calif. in 2004.
Williams pleaded guilty and was sentenced to probation.