ST. LOUIS – The head of a mortgage fraud ring that scammed 21 credit unions and banks was sentenced yesterday to 44 months in prison and ordered to pay almost $600,000 in restitution.
Dack Daugherty and three accomplices pleaded guilty to a scheme to sell distressed homes to buyers who never planned to repay loans on the properties. Proceeds from the scheme were laundered through Daugherty’s accounts at Aerospace Community CU. The ring arranged for the fraudulent purchase of 52 properties.
A federal judge increased the prison sentence for the 38-year-old Daugherty yesterday after Daugherty admitted he went on a spending spree after his indictment for mortgage fraud and borrowed hundreds of thousands of dollars to buy classic cars, a grand piano, motorcycles, commercial equipment and a luxury Jacuzzi spa.
Just as his borrowers did in the fraud scheme, Daugherty lied in his credit applications for the items and, after deceiving the lenders, never made a payment on any of these purchases. Most of the items have been repossessed.
