FRAUDULENT PROPERTY MANAGER SENTENCED TO 6 YEARS IN PRISON
The latest saga in the story of criminals Chester Ransom and Bryan Talbot. Unfortunately many homeowners and condominiums are still dealing with the fall out of their thievery.
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FOR IMMEDIATE RELEASE
June 15, 2012
Public Affairs
Website: www.usdoj.gov/usao/dc
Executive of
Property Management Company Sentenced
For
Defrauding Clients, Mortgage Lenders and Government
-
Scheme Involved More Than $2.8 Million -
WASHINGTON – Chester D.
Ransom, Jr., 45, the vice president of a property management company, was
sentenced today to six years in prison for defrauding his clients, mortgage
lenders, and the government out of more than $2.8 million.
The sentence was announced by Ronald C. Machen Jr., U.S. Attorney for the
District of Columbia; Peter Rendina, Acting Inspector in Charge, Washington
Division, U.S. Postal Inspection Service; James W. McJunkin, Assistant Director
in Charge of the FBI’s Washington Field Office, and Rick A. Raven, Special
Agent in Charge of the Washington Field Office of the Internal Revenue
Service-Criminal Investigation.
Along with Bryan W. Talbott, 49, Ransom pleaded guilty in January 2012 in the
U.S. District Court for the District of Columbia to charges of conspiracy to
commit bank fraud, conspiracy to commit mail fraud, and conspiracy to defraud
the government. Ransom was sentenced today by the Honorable Robert L.
Wilkins. In addition to his prison sentence, Ransom was sentenced to five
years of supervised release. As part of their plea agreements, Ransom and
Talbott agreed to criminal forfeiture and restitution of more than $2.8
million.
Talbott’s sentencing was continued until a later date after he was arrested on
June 14, 2012, pursuant to a warrant issued by Judge Wilkins, based on an
alleged violation of Talbott’s conditions of release.
According to the government’s evidence, Talbott was the president and Ransom
was the vice president of a property management company located in Washington,
D.C., that operated under multiple names, including Esquire LLC, Federal City
Mowbray, and Private Properties Inc. (collectively referred to as
“Esquire”). The defendants also lived together at a residence on North Portal
Drive NW, Washington, D.C.
From 2004 to the present, the defendants engaged in three separate fraudulent
schemes, resulting in more than $2.8 million in losses to the victims.
Fraud
Relating to Property Management
Through their property management company, Esquire, the defendants entered into
contracts with numerous property owners in the Washington, D.C. area to manage
their rental properties. Under many of the contracts, the defendants were
required to collect rental payments from tenants and use those funds to pay
bills relating to the properties, such as utility bills. After paying any
bills and deducting an administrative fee, the defendants were required to
remit the remainder of the rental payments to the property owners.
As part of their fraudulent scheme, the defendants frequently collected rental
payments from tenants but did not pay the bills for the properties, despite
falsely representing to the property owners that the bills had been paid.
Instead, the defendants used these funds for their own benefit. In addition,
the defendants also sent forged bank statements to some of their clients,
misstating the balances in their clients’ accounts.
Through this fraudulent scheme, the defendants defrauded at least 54 clients
out of a total of $1,269,278.
Mortgage
Fraud
On June 30, 2004, Ransom purchased the property on North Portal Drive NW for
$975,000, financing the purchase, in part, with two loans in the total amount
of $731,250 from WMC Mortgage Corp., a mortgage lender. Ransom executed
two deeds of trust on the property, granting WMC a security interest in the
property.
On December 29, 2005, Ransom filed with the District of Columbia Recorder of
Deeds two forged Certificates of Satisfaction, purporting to release the WMC
liens on the Portal property.
Then, on January 13, 2006, Ransom sold the Portal property to Talbott for
$1,110,000. The defendants provided copies of the forged lien releases to
the settlement company. Talbott obtained a loan in the amount of $750,000
from Fremont Investment and Loan. Talbott executed a deed of trust on the
property, granting Fremont a security interest in the property. Ransom
received a check in the amount of $515,034 from the settlement.
Less than a month later, on February 2, 2006, Ransom again “sold” the Portal
property to Talbott, this time for $1,250,000, despite the fact that Talbott
was already the legal owner. The defendants provided copies of the forged lien
releases to the settlement company. Talbott obtained a loan of $890,000 from
First National Bank of Arizona. Talbott executed a deed of trust on the
property, granting First National Bank of Arizona a security interest in the
property. Ransom received a check in the amount of $801,280 from the
settlement.
Tax Fraud
For tax year 2006, the defendants filed false federal and District of Columbia
tax returns. For both of their federal and D.C. taxes, the defendants
submitted Forms W-2 that indicated federal and D.C. income tax withholdings in
the following amounts:
|
Filer
|
Federal
Income Tax Withheld (Box 2)
|
State
Income Tax (Box 17)
|
|
Talbott
|
$214,677
|
$75,432
|
|
Ransom
|
$86,544
|
$31,222
|
In fact, the defendants did not have any actual federal or D.C. income tax
withholdings for tax year 2006. Talbott’s false tax returns generated a
federal tax refund in the amount of $66,655 and a D.C. tax refund in the amount
of $30,897. Ransom’s 2006 federal and D.C. tax refunds were blocked prior
to disbursement.
***
In announcing the sentence, U.S. Attorney Machen, Acting Inspector in Charge
Rendina, Assistant Director McJunkin and Special Agent in Charge Raven
commended the outstanding investigative work of Postal Inspector Steven Sultan
of the U.S. Postal Inspection Service; agents of the FBI’s Washington Field
Office; agents of the Internal Revenue Service- Criminal Investigation, and
Kevin Craddock of the District of Columbia Office of the Chief Financial
Officer, Criminal Investigation Division. They also praised the efforts of
members of the U.S. Attorney’s Office, including forensic accountants in the
Fraud and Public Corruption Section; Paralegals Diane Hayes and Sarah Reis;
former Paralegal Carolyn Cody; Legal Assistants Jamasee Lucas, Krishawn Graham,
and Nicole Wattelet; Information Technology Specialist Joshua Ellen; former
Intern Sierra Tate, Assistant U.S. Attorney Anthony Saler, who worked on
forfeiture issues, and Assistant U.S. Attorney David Johnson, who prosecuted
the case.
12-215
###
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