Guaranty Title owners sentenced for $4.1M wire fraud
The owners of now defunct Nixa-based Guaranty Title Co. have been sentenced in federal court for $4.1 million wire fraud, bank fraud and money laundering schemes, according to a news release from Beth Phillips, U.S. attorney for the Western District of Missouri.
Richard Burton, 60, of Nixa, and Kathy Allen, 53, of Sarcoxie, were sentenced in separate hearings Nov. 30 - Burton to six years and six months and Allen to three years and three months in federal prison without parole. The court ordered that the pair jointly pay more than $4.2 million in restitution.
Both owners pleaded guilty to conspiracy to commit wire fraud and money laundering, and Allen also pleaded guilty to conspiracy to commit bank fraud.
Burton was the president and majority owner of Guaranty Title Company of Southwest Missouri, Guaranty Title Company, DBA a collection of real estate title and closing services - Guaranty Title and Closing Co. and Guaranty Properties Inc. - that had 10 branch offices in Springfield, Branson, Ozark, Republic, Aurora and Mount Vernon. The real estate title and closing services companies were referred to collectively as Guaranty, the release said.
Wire fraud In the plea, Burton and Allen said they defrauded mortgage companies and individual customers of escrow money that had been wired to Guaranty for real estate payments from May 12, 2005-June 18, 2007. The pair illegally transferred $3.5 million from the company's escrow funds account to the firm's business operations account, using the stolen funds in day-to-day business operations.
They had their bookkeeper mark the transfers as loans to mask the transactions, including loans from a fictitious company called K & S Investments.
Bank fraud To cover up shortages in the company's escrow accounts, Allen and Burton directed the writing of checks that were deposited among various accounts held at Great Southern Bank and Ozark Mountain Bank. The check-kiting scheme was carried out from April 2007 to June 18, 2007, when Old Missouri Bank discovered the fraud and closed the bank account, the release said.
The scheme caused Ozark Mountain Bank to lose more than $680,000.
Money laundering From May 12, 2005-June 18, 2007, Burton and Allen admitted to participating in conspiracy to commit money laundering, involving the proceeds of the wire fraud and bank fraud conspiracies. By promoting the concealment of the fraud conspiracies, the unlawful money laundering occurred.
U.S. District Judge Greg Kays presided over the cases, which were prosecuted by Assistant U.S. Attorney Randall D. Eggert and investigated by the FBI, Internal Revenue Service Criminal Investigation and the Missouri Department of Insurance, Financial Institutions and Professional Registration.[[In-content Ad]]