(Atlanta- March 31, 2002) Attorney General Thurbert Baker announced the conviction today of a pair running a mortgage-flipping scam. The convictions, obtained after a week-long jury trial in Dekalb County Superior Court, were for three counts of felony theft by taking against both Kenneth Bradford, a/k/a Ken Taylor, and Jo Ellen Bryant, a/k/a CJ Taylor, for operating the mortgage-flipping scheme.
Bradford and Bryant held themselves out as a married couple under the fictitious names of Ken and CJ Taylor. The "Taylors" owned a company called Prime Plus which bought and sold residential property to individuals seeking to own "investment" property. Prime Plus specifically targeted unsophisticated individuals with good credit who wanted to own property for investment purposes. Once an "investor" was located, Prime Plus would create false, fictitious and fraudulent mortgage packages in order to secure loans for the investors. Prime Plus used a mortgage company called Great Oaks Properties to actually secure the loans from secondary market lenders (companies that make residential property loans and then immediately sell the loans).
In announcing the convictions, Attorney General Baker stated, “Our office will remain vigilant in ensuring that homeowners in Georgia don’t see their property values plummet and their neighborhoods ruined by crooks out to make a quick buck. Our citizens and businesses deserve to have con artists like these put out of business, and I am more than willing to make that happen.”
Prime Plus targeted the middle-class Moorings subdivision in Gwinnett County. Prime Plus would purchase a home for fair-market value (ranging from $190,000 to $230,000) and then sell it to an investor at a highly-inflated price ($350,000 to $380,000). These homes were bought and sold by Prime Plus at real estate closings only minutes apart. These transactions are known in the mortgage fraud arena as "flips" or "flipping."
Prime Plus promised the renters that the company would manage the residences, place business people and athletes in the residences as tenants, and collect the rents. All the investors were responsible for, according to the "Taylors", was paying the monthly mortgage. However, when the defendants left the state in Spring 1997, the investors discovered they were left with homes that never had tenants, had become run-down, and were grotesquely overvalued. Most of the homes went into foreclosure and the banks lost hundreds of thousands of dollars.
However, the greatest harm done by the defendants was the damage to the subdivision and its legitimate homeowners. Homes throughout the Moorings were flipped and then re-flipped. Property values have plummeted and decent neighborhoods have become run down. Homes that have been flipped have become havens for drug dealers and prostitution rings. The Moorings was no exception.
This case was prosecuted by Assistant Attorneys General David McLaughlin and Kimberly Schwartz. The state’s investigation was handled by Chuck Titshaw and Joel Byers from the Department of Banking and Finance and Sherry Lang, Debbie Shaw, Steve Lewis and Sandra Putnam from the Georgia Bureau of Investigation.