Mortgage fraud victims asked to tell of their loss
Victims of a multi-million dollar mortgage fraud are being urged to let federal prosecutors and a judge know how they have been impacted by the scam.
Those victims were in Shelbyville, but one of the perpetrators is Roger Ritch, founder of Ritch's Building Supply in Lewisburg and the man who sold the city nearly 50 acres last year.
The crime's ringleader, William T. McMahan, was sentenced last week to 6-1/2 years in prison and ordered to pay over $2.4 million in restitution toward 15 mortgage companies that were directly defrauded.
However, Bedford County families also victimized by the fraud must file their own civil complaints or a class action lawsuit before they may recover damages.
McMahan, Ritch, Carrie Snow and Jonathan Henderson were charged in May with bank fraud and money laundering that affected hundreds of homes in Shelbyville. Bradley Aydelott was indicted on the same charges in July. All pleaded guilty to federal indictments saying they obtained financing under false pretenses and falsely represented the employment status and income of borrowers.
Ritch sold the old Murray horse farm to Lewisburg for $525,000 in March 2008 when Councilman Hershel Davis seconded Councilman Robin Minor's motion to buy the land on a recommendation from then-Mayor Bob Phillips who broke a 2-2 tie for the purchase.
Expansion of Rock Creek Park for practice fields and parking for Goats Music and More were reasons given for the purchase which, Minor noted, wouldn't increase taxes. Others noted property tax revenue would go down when the land became public property.
Some of the land may be used to expand the city's sewage treatment plant, and some could be sold for development near apartments overlooking Rock Creek, Phillips said. Another idea is for an agriculture center where goats, cattle, horses and dogs might be shown.
Councilmen Quinn Brandon, now Stewart, who objected to the price, and now-former Councilman Phil Sanders voted against the purchase. A seat held by Elvin White, who resigned from the Council, was still vacant in March 2008.
This week, Ritch's attorney, John Norton of Shelbyville, filed about 50 letters from Ritch's supporters requesting leniency for him.
Ritch is to be sentenced on Jan. 4 at 10:30 a.m. EST in federal court in Chattanooga.
"It's important that those affected by this mortgage scheme contact us and let us know how they feel," Assistant U.S. Attorney Gary S. Humble told the Shelbyville Times-Gazette.
Letters can be sent to Humble and/or U.S. District Court Judge Harry S. Mattice Jr. at 1110 Market St., Suite 301, Chattanooga, TN 37402.
"Let us know how his (Ritch) conduct affected them," Humble said.
Bedford County lawmen say Ritch's company sold houses once valued at some $30 million, and foreclosure on the fraudulent loans resulted in a loss to lenders of nearly $2.4 million.
Humble says those impacted by the scheme are welcome to attend the sentencing hearing on Jan. 4.
According to federal documents, a total of 61 people in Shelbyville bought homes and lost them through foreclosure as a result of the scheme.