The former owner of Century 21 Apollo in Modesto has agreed to plead guilty to fraud charges in a deal that should fetch a federal prison sentence of at least eight years.
James Lee Lankford and his husband, Jon Vance McDade, bilked $10 million from elderly homeowners in Modesto and Hughson and from lenders, from 1999 to 2010, authorities said in a 49-count indictment.
Lankford, 74, will admit to seven counts of mail fraud, avoiding a possible maximum term of 20 years for each charge if found guilty at trial, according to the plea agreement. ( Click here to see Lankford's plea.)
McDade, who also goes by Jon Lankford since their July marriage, according to his Facebook page, will be imprisoned for one day, according to his deal. He was indicted on 11 counts and will plead guilty to one count of bank fraud, the document says. ( Click here to see McDade's plea.)
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Neither agreement, both signed in late August, is valid until the men formally appear before a judge in federal court in Fresno, a U.S. attorney's spokeswoman said. The men are not in custody and no longer live in Modesto.
Attempts at setting a date have not been successful, so the government on Friday scheduled hearings for Lankford on Monday and for McDade the following week.
More than 10 victims lost more than $7 million under the counts listed in Lankford's plea deal. Sentencing guidelines suggest a range of eight to 10 years in prison; government attorneys agreed to recommend a sentence "at the low end," the deal says, though Judge Anthony Ishii could consider other factors, including the victims' vulnerability.
The men gained the trust of elderly homeowners and enriched themselves by obtaining multiple fraudulent loans on properties, according to the plea deals.
Sellers and banks, deceived by forgeries and lies, provided loans without knowing about other debt, documents say. In some cases, elderly sellers lost property to foreclosure, court papers show.
A Bee investigation of recorded documents in October 2010 showed that the men had obtained loans worth a combined $654,000 on one property acquired for $530,000, and separate loans worth a combined $274,900 on another home acquired for $140,000. One recorded document, purporting showing that Lankford had paid off an elderly couple, appeared to be signed by a man and his wife three months after the man died.
As part of McDade's plea deal, he will admit that he claimed a $27,800 monthly income when applying for a bank loan on the men's Wycliffe Drive home in 2007, when in reality he didn't make that much in that entire year. They got an $880,000 loan, and three years later, the property sold in foreclosure for $385,000.
Lankford's deal requires that he repay "the full amount of restitution as ordered by the court to all victims," but they might have a hard time collecting.
Lankford was unemployed when he filed for bankruptcy protection in early 2012. His monthly income, including Social Security payments for adopted children with special needs, was $5,766 at the time, and his average expenses came to $11,124, his petition read.
The document said Lankford lost a dozen Modesto properties to foreclosure, mostly in 2008 and 2009.
He was sued six times in Stanislaus County, all alleging fraud and breach of contract.
Bee staff writer Garth Stapley can be reached at firstname.lastname@example.org or (209) 578-2390.