Saturday, August 22, 2009

JNS BLOG EXCLUSIVE: Larry Maxwell Gets "Max Of The Max" Sentence For Mortgage Fraud, Part Three Of Four

Photo By John Hoff, individuals posed for photo

Parts Three and Four of the Larry Maxwell sentencing story took me a while, and I'll have to write the last half from a cheap hotel in Kentucky like a bloggy tribune to Hunter S. Thompson, but there can be no letting up in the telling of NoMi's story of revitalization. Catching and prosecuting the criminals who seeded mortgage fraud into the very soil of our North Minneapolis neighborhoods is part of that epic tale.

And, of all the criminals caught so far...the T.J. Waconia fraudsters, Marlon Pratt, Donald Walthall...only Larry "Maximum" Maxwell has such a cool nickname to go with his crimes. No doubt this will give Maxwell some small degree of comfort as he does 16 years in the pokey. In any case...

If you need to refresh your recollection, click here for a link to Part One. And here is a link to Part Two.

In the photo above, Melony Micheals receives certified copies of the judgment against Larry Maxwell and some of the various business entities involved with Maxwell's crimes. These documents will prove useful in filing civil suits to recover damages, but who will be named in the suits? That's what I'm waiting to see. I bet there will be a few surprises. In any case, Micheals has made no secret of her intention to file civil suits. Anybody who has crossed John Foster and Melony Micheals would be well advised to contact her attorney and come crawling on bended knee, offering to settle. You know who you are.

SPECIAL NOTE: Unfortunately, this blog has consistently misspelled the surname of Melony Micheals as "Michaels." I will use the correct spelling from now forward, but it may take a while to go back and correct old blog posts.

When we last left off, John Foster had finished his detailed, moving testimony about having his identity and life ripped off and it was time for the daughter of Melony Micheals to testify.

Chelsea Micheals will be 20 in March, but can be mistaken for somebody already in her early 20s. Perhaps she just appears more mature than most 20-year-olds, or perhaps extra years have been added to her life from stress. She talked about how her senior year of high school had been tough with her parents' good credit ruined. For example, sports outfits were too expensive in light of the ruined credit and shattered finances. There have also been times the young woman is afraid to go to her car at night, because of fears the criminals who stole her stepfather's identity (like the crackhead Kingrussell) could be dangerous and out to hurt somebody in the Foster/Micheals family.

As if the disruption of high school wasn't bad enough, Chelsea's college has also been impacted. Like many or possibly most middle class college students, Chelsea was hoping to spend a semester abroad. Now that doesn't appear possible, however.

Chelsea's statement was brief. Judge Chu consoled the young woman, especially in regard to the disruption of her education. The whole time, one of Maxwell's family members sat with that odd little half-suppressed smirky look.

Melony Micheals spoke next. Later she would complain that John Foster had stolen some of her material about the impact of having his identity stolen. However, there was more than enough thunder left. In some ways, discussion of the little things was more poignant than the big stuff: like how answering the phone becomes impossible due to constantly-calling creditors (who aren't REALLY your creditors) and how every time you must go through multiple levels to reach a supervisor's supervisor, only to be told they'll be needing to see copies of the police reports about the identity theft...and then the same company would call again, demanding the exact same thing.

To make matters worse, some bill collectors would accuse Micheals of LYING.

Now at the summit, the conclusion, the epic end to the epic trial, Micheals made a point of talking about the many hundreds of hours put in by the investigators and the prosecutors. She talked about a pivotal mistake made by the judicial system which led to this moment: Larry Maxwell had been allowed to keep his real estate license despite previous criminal activity. Micheals hoped aloud something like THAT wouldn't happen again, that the judicial system had finally learned the true nature of Larry Maxwell.

Micheals talked about being unable to refinance the home she shares with John Foster because they already had too many mortgages…FAKE mortgages. When the sentencing finally came down, the suffering still wouldn’t be over. They estimate there will be “seven to ten years of paying and explaining” until they come out from under the shadow cast over their finances. Therefore, Micheals said, Larry Maxwell “shouldn’t get less.”

Micheals talked about the complex and insidious nature of identity theft. If somebody stole your television, the police would have immediately helped. But with identity theft and mortgage fraud, Micheals—who was one of the victims—had to perform her own investigation for a long time until finding a police department which would get involved.

Neighborhoods also suffer due to mortgage fraud, Micheals said, with “boarded up houses with phone books slewed all over the place.”

In conclusion, “You don’t need a mask or gun to get way more than people get for robbing a bank.” This whole time, Maxwell sat without any strong reaction to the words of Foster, Chelsea Micheals, and Melony Micheals. He is one cool cucumber.

Judge Chu told Micheals she had read the victim impact statement submitted earlier and it “made an impact on me.”

“You’re the reason this case is here,” Chu said. “You didn’t give up.” It’s moments like this you wonder when this story will become a Lifetime Movie.

Turning to prosecutor Brad Johnson, Chu said she wanted to hear from the state as to the appropriate ranking for the crime. Johnson rose and spoke of the grueling 7-week jury trial. He said the state sought a prison sentence of 148 months, about 14 years. This was apparently more than any previous mortgage fraud/racketeering case in the State of Minnesota. Ever.

In this case, Johnson said, “There were not just lies on a loan application but lies to fabricate personas.” The fraudulent loans to the lenders were equal to $2,690,175.00. Restitution to the lenders was sought. There were also calculations of restitution by the Fosters. Plus Johnson wanted a “million dollar fine, which is the maximum under the statute.”

Furthermore, the state was asking that “no assets can be transferred or disposed of” and Johnson asked for a “permanent injunction of ANY professional licenses without court approval.” Johnson also sought an order that Maxwell have no contact with the Fosters and never again use the identity of John Foster. The court and the state “need to investigate and seek assets to pay restitution.”

It’s moments like this you have to wonder: is there a buried Larry Maxwell treasure? And if so, who has the map?

Johnson mentioned Tanya Patterson breaking down on the stand, her tenants displaced by foreclosure. And for what? Larry Maxwell did these things “to support a lavish lifestyle.”

Johnson said he wanted Maxwell’s sentence to be a message to those entrusted by the State of Minnesota with professional licenses. The message should be as follows: IF YOU DARE TO COMMIT A FRAUD, YOU WILL BE HELD TO ACCOUNT, THE CONSEQUENCES WILL BE COMMENSURATE WITH THE SEVERITY AND GRAVITY OF YOUR SCHEME.

(Caps not in original volume of statement)

Now it was Larry Maxwell’s turn to say something in regard to his prison sentence. He first wanted to speak to Larry Reed, the attorney Maxwell had (kind of, sort of) tried to fire. See Part One.

They went up into the jury box to whisper whisper whisper. I watched Reed’s face and tried to read it. Reed didn’t seem to be projecting much confidence. Reed had the kind of facial expression which says, “Look, no matter what you do here…you’re screwed. What can I tell you?”

To be continued in Part Four.

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