CHARLESTON, W.Va. -- A Utah man who facilitated a complicated mortgage "flipping" scheme that officials say wreaked financial havoc on homes in Putnam County's Stonegate subdivision will spend more than four years in federal prison.
U.S. District Judge Thomas E. Johnston sentenced Raymond Morris to 57 months in prison Monday on charges of conspiracy to commit wire fraud and bank fraud, marking the end of a six-year investigation that involved several conspirators in Utah and West Virginia.
"You damaged an entire neighborhood here in West Virginia," Johnston said. "It was a clever scheme, a sophisticated scheme. It was appalling in it's audacity, actually."
In the early- and mid-2000s, Morris headed a Utah group made up of rookie investors that sought out potentially lucrative real estate markets across the country, prosecutors said.
Putnam County brokers Deborah and Todd Joyce conscripted appraisers James Thornton and Mark Greenlee to pin drastically inflated values on homes in the Stonegate subdivision in Hurricane. Morris sold those homes off to his investors, promising that they would sell at an even higher price.
Michael Hurd, another Utah man, used a front program he created to conceal payment sources and rip off loan proceeds.
In order to sell the homes to members of his group, Morris handed out spreadsheets that showed more and more of the properties were being bought out, creating an appearance of scarcity that convinced the unwitting investors to "act irrationally and purchase a property thousands of miles away, sight unseen," assistant U.S. Prosecutor Thomas C. Ryan said in a sentencing memorandum.
Morris also told the members that he himself bought one of the most expensive homes in Stonegate.
Morris' attorney, John Carr, said that his client did not have a financial background or knowledge of the real estate industry and was only a member of the investor group, which was actually led by Chad Haber, according to court filings.
Morris helped match investors to properties in West Virginia and got paid a fee for each match, Carr said, according to filings.