This is the perfect example of why you should do business with people you know and trust. This article comes to us from the Kansas City Star.KANSAS CITY, Mo. -- Former Jackson County Executive Katheryn Shields and her husband were indicted Thursday on federal charges of taking part in a mortgage fraud scheme.
Shields, 60, and her husband, attorney Phillip Cardarella, 59, and nine other people are charged with one count each of conspiracy and 11 counts each of wire fraud.
"They have not been able to find anything illegal. And in this indictment, there is nothing illegal that either my husband nor myself has done," Shields said.
Federal prosecutors allege that the couple were approached by a group of individuals last fall who offered to sell their home, which was listed at $699,950, for $1.2 million.
The couple was to receive $707,000 of that amount, the remainder being split among other co-defendants and explained to lenders as a "management fee." To get the mortgage approved, the defendants allegedly provided lenders with fraudulent financial information and inflated property appraisals.
Officials said the FBI stopped the transaction from going through.
Others charged in the case are James Elliott Coleman, 58, Raymond Walter Zwego Jr., 58, and James R. Rhoades, 48, all of Kansas City; Larry E. Barshaw, 56, and Linda M. Thompson-Barshaw, 57, both of Kansas City, Kan.; Monty J. Kinman, 25, of Overland Park, Kan.; Rick A. Peterson, 32, of Lenexa, Kan.; Jeremy A. Plagman, 29, of Lee's Summit, Mo., and Michael Rodd, 52, of Olathe, Kan.
"Cardarella told Zwego that he was aware of and would go along with the fraudulent arrangement," U.S. Attorney Bradley Schlozman said.
Phillip Cardarella
Meeting with reporters after Schlozman's conference, Shields and her husband denied being part of a conspiracy, saying they had simply tried to sell their house, which had been on the market for 18 months.
"There's nothing illegal about selling your home for more than you list for it," said the couple's attorney, Curtis Woods.
The couple said their signatures were forged on a real estate sales contract. Cardarella also said he knew only a few of the other defendants and that Shields knew none of them.
Running For Mayor
Shields spent 12 years as Jackson County executive -- the county's highest elected office -- but did not run for last year for a fourth term. She is now among several candidates running to succeed Kay Barnes as mayor of Kansas City. The city elections are this spring.
Cardarella told KMBC's Micheal Mahoney that they are victims in the case and that the indictments are "a political fix" and "political BS."
The defense attorney called it a bogus charge. Both Shields' husband and attorney said the former county executive did little in the deal except to sign the final papers.
"I look forward to the trial. I wish we could go before a jury on Monday," Shields said.
Mahoney reported that a news conference announcing the charges was delayed several hours because Cardarella was apparently trying to testify before a grand jury.
"They were intent on browbeating those grand jurors and preventing me from telling the truth. And it still took them four hours to bring back an indictment," Cardarella said.
Meanwhile, Shields said she still plans to run for mayor.
"Because I know that when all the facts are in, it will show that neither I nor my husband did anything wrong, and this is the continuation of a political witch hunt," Shields said. "I think I've been subjected for the last three-plus years to political terrorism and I will not give in to political terrorism."
Schlozman said this is not a political prosecution; he said he's an interim U.S. attorney and that his office doesn't worry about local politics.
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