KC couple sentenced to 9 years for fraud scheme; foster mom explains how they broke her trust

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KANSAS CITY, Mo. -- A Kansas City couple will spend the next nine years behind bars and pay back more than $1 million each in restitution for orchestrating a fraud scheme that targeted dozens of financially strapped people.

A federal judge sentenced John Norris and Julie Hatcher on Thursday, ordering prison time without parole.

Prosecutors said the couple created an investment firm that promised to help financially struggling clients get out of debt.

Court documents show the couple promised their firm, Reaper Investment Partners, LLC, would work to refinance existing home loans at a significantly lower principal amount and low-interest rate. They told homeowners RIP would get titles to the properties.

Upon entering into the contract, homeowners were to stop making payments to their lenders and instead pay the agreed amount to RIP. Homeowners were promised that when the refinanced RIP loan was paid off, they would get the title to their property.

But prosecutors said the couple really pocketed the money – causing many people to lose their cars and homes when the banks repossessed them. In May, the couple pleaded guilty to participating in a conspiracy to defraud those homeowners and other debtors.

One of their victims was Doris Linningham of Kansas City, Mo.

“I feel sorry for them, really,” said Linningham, a 67-year-old woman who lost more than $6,000 in the scheme, of the couple sentenced.

Linningham is a foster parent to several children and has been for most of her life. It’s something she loves, but taking them into her home means money is tight.

That’s why Linningham wanted to refinance her house a few years ago and got the help of RIP when they promised to lower her interest rate.

“I trusted them,” she said, “and I thought they were in touch with Bank of America. I went to them honestly, never missed a payment with them.”

Prosecutors said the couple pocketed Linningham’s money – and in December 2011, Linngham’s bank told her it would foreclose on her home.

“I’m angry,” Linningham said, “but I’m more hurt than angry because you don’t expect nobody to do that to you for no reason. I can see if I had plenty of money, you know. I don’t have any.”

Prosecutors said the couple did the same thing to 80 other cash-strapped people and eventually took in more than $1 million.

As for Linningham, she said the man who eventually bought her home from the bank graciously agreed to let her and her foster children stay there. She now pays him rent - in a home she was once working to own, and now never will.

“I was trying to build a home for the less fortunate, for my babies that need help,” she said. “That hurts. That really hurts.”

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