Fraud and Prevention

Two More Conspirators in Metropolitan Money Store Scheme Sentenced

By James Comtois
October 7, 2009

Two more defendants in the Metropolitan Money Store mortgage fraud scheme, which falsely promised to help homeowners facing foreclosure keep their homes and repair their damaged credit, have been sentenced.

U.S. District Judge Roger W. Titus sentenced Clifford McCall of Lanham, Md., to four years in prison followed by five years of supervised release and his daughter, Chandra Jones, also of Lanham, to 33 months in prison followed by five years of supervised release for conspiracy to commit mail and wire fraud in connection with the MMS scheme.

In addition to prison time, Judge Titus ordered McCall to pay of $2.5 million in restitution and Jones to pay $3.9 million in restitution.

According to Rod J. Rosenstein, U.S. attorney for the District of Maryland, McCall was president of Burroughs & Smythe Financial Services and a director of the Fordham & Fordham Investment Group, a foreclosure consulting and credit servicing business. These companies, which McCall and others incorporated, assisted the MMS in offering foreclosure consultation and credit services to financially distressed homeowners.

Beginning in September 2004, McCall conspired with others in a scheme to fraudulently promise to help troubled homeowners with equity in their homes avoid foreclosure and repair their damaged credit. The homeowners were directed to put title to their homes in the names of straw buyers for a year while MMS promised to improve the homeowners' credit ratings, help them obtain more favorable mortgages and eventually return title to their homes to them.

The homeowners were told that the equity withdrawn from the properties would be used to pay the mortgage and expenses on their homes and to repair their credit. The straw buyers were paid $10,000 to participate in the scheme.

Using the homeowners' properties, the conspirators applied for mortgages to extract the maximum available equity from the homes. They submitted fraudulent loan applications to mortgage lenders to obtain fraudulently inflated loans on the target properties in the straw buyers' names.

At settlements, the conspirators imposed numerous undisclosed fees, sometimes for services not performed, far in excess of industry standards and transferred the sale proceeds into the conspirators' business and personal bank accounts for personal use.

McCall obtained voluminous cashier's checks in the names of straw buyers and MMS employees to carry out the scheme. McCall also agreed to act as a straw buyer and secure a mortgage loan in his own name for a property in Lanham and in return was paid $10,000. McCall made false statements as to personal and financial information on settlement documents.

As a result of this scheme, McCall fraudulently obtained and used at least $2.5 million for his personal benefit.

Jones was hired in July 2005 to work as a loan processor at MMS and shortly thereafter participated in the fraud scheme. In November 2005, she also began to work at F&F. Jones was responsible for paying the mortgages on foreclosure reversal program properties and assisting program participants with repairing their credit.

Jones was later made vice president of F&F and a director of Burroughs & Smythe Financial Services. Jones was not licensed to provide credit repair services and had not received any training related to the mortgage industry, credit repair, or financial services.

During the course of the conspiracy, Jones placed $790,000 from F&F's bank accounts into her personal bank accounts.

For example, on Oct. 25, 2006, Jones wire transferred $20,000 drawn on one of F&F's accounts and deposited the funds into her personal bank account. At the direction of co-conspirators, Jones transferred funds from the F&F accounts to pay the personal expenses of co-conspirators and observed co-conspirators using funds from the F&F accounts for their personal benefit.

Jones also served as straw buyer for two properties and secured mortgage loans in her own name to do so. She was paid a total of $8,600 for serving as a straw buyer. In purchasing the properties, Jones made false statements as to personal and financial information on settlement documents.

As a result of this scheme, the total loss attributable to Jones is $4.2 million.

Ten defendants have pleaded guilty in this scheme. In addition to McCall and Jones, three other defendants have been sentenced. Kurt Fordham was sentenced to 10 years in prison for his participation in the scheme. Richard Allison was sentenced to 18 months in prison. Carlisha Dixon was sentenced to five months in prison and five months home detention.

The remaining defendants are scheduled for sentencing within the next two months.