Broker pleads guilty in ongoing mortgage fraud investigation

One of six area individuals indicted late last year for alleged mortgage fraud pleaded guilty in federal court Tuesday to participating in a scheme to defraud lenders.

Cheryl Joan Kassebaum, 43, of Ozark, admitted to playing a role in a conspiracy between March 2006 and July 2006, according to a news release from the U.S. Attorney's Office for the Western District of Missouri. The scheme involved obtaining mortgage loans for home purchases based on false loan applications, and giving a significant portion of the loan proceeds to the homebuyers without the lender's knowledge and after closing. Kassebaum is a former mortgage broker and co-owner of Metro Consulting Group.

Also allegedly participating in the scheme were Kassebaum's husband, Scott Allen Kassebaum, Ricky Dean Unruh and Charles M. Davis, who was the owner of Master Marketing Consultants and a former branch manager for Gateway Mortgage. Both Kassebaums and Davis were indicted Nov. 20, 2008; Scott Allen Kassebaum later pleaded not guilty but has a change of plea hearing scheduled for Aug. 3.

The scheme involved seven houses with mortgages ranging from about $200,000 to more than $400,000. Loans were obtained from First Magnus, Homecomings Financial and Countrywide Financial, according to the plea agreement, and the loan proceeds returned to the borrowers ranged from about $30,000 to nearly $100,000. Some of the homebuyers later defaulted on the loans, and the homes have been or are being foreclosed on.

Kassebaum's part in the conspiracy was to prepare and submit fraudulent loan applications to lenders, while knowing they included overstatements of income or understatements of liabilities. She also falsely indicated that the homebuyer would reside in the home.

Kassebaum also returned portions of the loan proceeds to herself and other homebuyers, without the lender's knowledge, by routing the proceeds through Master Marketing Consultants, and then through Metro Consulting Group.

In addition to conspiracy, Kassebaum pleaded guilty to one count of wire fraud and one count of money laundering. The U.S. Attorney's office pegs the economic loss resulting from Kassebaum's actions at $497,200. She is subject to a sentence of up to 45 years in federal prison without parole, plus a fine of up to $1.5 million and an order of restitution. A sentencing hearing is pending.

The case is being prosecuted by Assistant U.S. Attorney Douglas C. Bunch and was investigated by the FBI and the Internal Revenue Services-Criminal Investigation.

The indictment last November - the result of an investigation ongoing for more than three years - also included Randall Lee Hall, former branch manager for Choice Mortgage; Springfield resident Shanda Lynn Moore; and Steven Ray Spencer, of Carl Junction. Davis, Spencer and Moore were indicted for alleged involvement in a separate scheme from January 2006 to February 2007, while Spencer and Hall were indicted for a similar conspiracy that allegedly occurred from November 2005 to October 2006. In total, the trio of conspiracies involved 29 homes in Greene and Christian counties.[[In-content Ad]]