I recently published an article about a local housing scam, flipping one house three times in several years and making over $600,000 on the deals. I asked why the Commercial Appeal had not published any detailed news of this. I sent the information on to the authorities for investigation and hopefully prosecution. Well, these scam artists have finally been indicted. (See the indictments below and a national article on housing scams, especially Memphis).
Here is the article that I published before the recent indictments.
IS THIS A GREAT COUNTRY OR WHAT? LOCALS FLIP JUST ONE PROPERTY THREE TIMES AND MAKE OFF WITH $684,000
Last week there was an interesting article in the CA concerning fraudulent appraisals of properties. The lead conspirator was not named at that time. The appraiser would take low priced properties, get an inflated appraisal, and then through a series of transactions, the property was sold and mortgaged and the difference was pocketed. In many cases, Fannie and Freddie or some bank and eventually the taxpayers would end up eating the difference between what the parties paid for the property and the amount of the inflated mortgage. These people would flip the same properties three and four times in the period of a few years.
There are hundreds of these type transactions listed locally in Shelby County and DeSoto County and I have shown some listed in the attached pdf files. However the one that stands out is at 744 Melrose. Mykisha Williams bought the property in April 2004 for $145,000 and sold it in May for $385,00000 ($240,00000 profit). Then in January 2005 Gloria Buntyn bought the property for $170,000 and in February sold it to Mykisha Williams for $385,000. ($215,000 profit). Then in February 2006 Kieth Threatt bought the property for $190,000 and in May 2006 sold the property for $419,000 to Sanchez Richmond ($229,000 profit). Total profit $684,000 less a few expenses.
This is a good local example of what happens to large government programs where there are people just waiting to scam the system. We are talking hundreds of millions of dollars here and this is just in Shelby County Tennessee and Desoto County Mississippi. This is a local example of how this current economic crisis happened and who is responsible, namely scam artists and politicians buying votes. Are you listening Barney and Chris?
I have listed below just three pieces of local property. There are many more and I hope that the FBI is investigating these transactions.
Basically the scheme illustrated by the attached pages of transactions from Tom Leatherwood’s site shows properties at 144 Person, 395 Edith and 744 Melrose. The scheme goes like this.
A foreclosed property is bought for a low price. The buyer then sells the property a few months later to an associate for three to four times the purchase price. An inflated mortgage is obtained and sold to Federal National Mortgage Association or a bank. Then later, the property is foreclosed after no payments are made on the mortgage. Then, unbelievably, the same cycle happens again to the same property just a few months later. Another example is shown below.
144 Person: Federal National Mortgage Association sells property to Washington Mutual Bank for $7500. The same day, Washington Mutual sells the property to Mykisha Williams for $7500. A little over a month later, Mykisha Williams sells the property to Melanie Wilkes for $60000. The same day Melanie Wilkes gets a 90% mortgage from Argent Mortgage for $54000. Argent Mortgage must have unloaded the mortgage to Wells Fargo Bank as they ended up buying it on the courthouse steps for $50000 on December 2005. Then in June 2006 Wells Fargo sells it to Keith Threatt for $18000 and in October 2006 Keith Threatt sells the property to Onitsha Paige for $59000 and Onitsha gets a mortgage for $50150. Unbelivably a third flip is in the process.
I think you get the idea. This is just the tip of the iceberg. There are hundreds of such deals in the records. Why is this happening? Is there no oversight? Why is no action being taken? Why is the paper concentrating on $5 payments for favors in the County Clerk’s office when here it is obvious that millions are being lost.
Some of my friends say the government has only the best of intentions. Just look at the results and guess who gets to pay the bill for each of these transaction. THE TAXPAYERS AS USUAL TAKE A BATH AND THE GOVERNMENT SHRUGS OFF SUCH DEALS AS ISOLATED INCIDENTS.
Well, take a look at the article on the link below. The title is “5 Indicted and 1 guilty plea in Tennessee flipping fraud allegations”
This is going on all over the country and this is not the only local frauds. Thanks to Barney Frank, other DC politicians and Freddie and Fannie, we are seeing billions in fraud and they are only indicting a small fraction of the crooks. This is your Congress at work.
I have included the indictments below. They make interesting reading.
Indictment 1 (PDF)
Indictment 2 (PDF)