Missouri Broker convicted of Fraud
William E. McKanry, from Warrenton, Missouri has been convicted of conspiracy and fraud surrounding his involvement in a mortgage fraud scheme in the St. Louis Area. Mr. Mckanry who is age 70 and from Warrenton, Missouri owned and operated USA Properties in the St. Louis Area. He along with his son William C. McKanry and Paula Enders were the conspirators in the mortgage scheme that involved over twelve properties in the St. Louis area.
United States Attorney Michael Reap stated in a press release on October 9th that all three defendants were indicted last October. William C. McKanry Jr. was the owner and operator of USA Title LLC and Paula Enders was a licensed broker operating under the mortgage broker company called Foundation Mortgage LLC.
The trio during the period of December 2005 and January 2006 sold twelve residential properties through Enders. The sale prices of the properties involved total some two million seven hundred thousand dollars. The properties were located in Florissant, St. Charles, O’Fallon, Hazelwood, Lake St. Louis, Ballwin and St. Louis City.
The original indict states that Enders fraudulently completed information on loan applications for mortgages and subordinate financing. Enders made the source of the down payments and settlement charges appear to be coming from the borrowers on the loans when in actuality the down payments and settlement charges were made by the McKanry’s who were the sellers in the transactions.
The closings conducted by USA Title LLC showed that Enders in regard to properties involved received two hundred twenty six thousand dollars for her commission fees. The fees were shown on the HUD 1 to appear as construction rehabilitation costs however Enders used them to purchase Foundation Mortgage, LLC.
Eleven of properties that closed at USA Title have gone into foreclosure and were resold for one million two hundred thousand dollars; resulting in a loss of over one million five hundred thousand dollars. Enders by match buyers with USA Properties assisted the McKanry’s in taking advantage of spread between what USA Properties were willing to pay for the properties and what prospective investors were willing to pay.
William E. McKanry was convicted of one count of conspiracy to commit bank, wire and mail fraud; one count of making false statements; four counts of wire fraud; and three counts of mail fraud. Sentencing for Mr. McKanry is scheduled for December 22, 2009.
Mr. McKanry’s son, William C. McKanry, 43 from Albans, Missouri pleaded guilty this past June to related charges and is scheduled to be sentenced on October 15th of this year. Paula Enders, 37 from Florissant, Missouri pleaded guilty in December of 2008 and is scheduled to be sentenced on October 22nd of this year.
