Mortgage fraud scam victims asked to report on impact

Victims of a multi-million dollar mortgage fraud scheme are being urged to let federal prosecutors and a judge know how they have been impacted by the scam.

Last week, the ringleader of the crime, William T. McMahan, was sentenced to six and a half years in prison and was ordered to pay over $2.4 million in restitution.

However, the money will be going toward 15 mortgage companies that were directly defrauded, and those families in Bedford County who were taken advantage of will have to file their own civil suit or a class action lawsuit before being able to recover damages.

McMahan, along with Roger Ritch, Carrie Snow and Jonathan Henderson, was charged in May with bank fraud and money laundering in a scheme involving hundreds of homes in Shelbyville. Bradley Aydelott was indicted on the same charges in July.

All have pleaded guilty to counts one and four of the federal indictment, stating that they obtained financing under false pretenses and falsely represented the employment status and income of borrowers.

This week, Ritch's attorney, John Norton of Shelbyville, filed about 50 letters from local supporters requesting leniency in the case.

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 United States Attorney Gary S. Humble told the T-G.

Letters can be addressed to either Assistant United States Attorney Gary S. Humble or United States 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 suggested.

The Bedford County Sheriff's Department says the scheme involved the sale of houses by Ritch's company totalling approximately $30 million, and foreclosure on the fraudulent loans has resulted in a loss to lenders totaling approximately $2.4 million.

Humble also said that 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 who bought homes lost them through foreclosure as a result of the scheme.