Kansas City Star, The (MO)
Appraiser testifies about inflated price for Shields' home
TONY RIZZO, The Kansas City Star
Two appraisers valued the Kansas City home of Katheryn Shields and Philip Cardarella at $1.2 million, about $500,000 more than its listed sales price.
One of them was working with the FBI. The other later was charged with mortgage fraud conspiracy.
On Thursday, Jeremy Plagman, who was indicted along with Shields, Cardarella and eight others, described how he intentionally inflated the house's value last fall.
Federal prosecutors allege that the conspiracy led by Raymond Zwego sought to profit by falsifying documents to obtain a loan far in excess of the home's actual value.
Plagman testified that he was contacted by a mortgage brokerage employee last October and asked to do an appraisal. The employee faxed him a sales contract on the property in the Sunset Hill area for $1.4 million.
Donald Gossman, the other appraiser who testified earlier in the trial, said he became suspicious because of the discrepancy between the sales price and the house's $700,000 asking price on a real estate database. He called the FBI and agreed to cooperate in its investigation.
Plagman testified that he, too, had questions about the discrepancy and said he could not find any sales of comparable houses in that neighborhood for that price.
He testified that he told the mortgage brokerage employee who hired him that he did not think the house was worth $1 million.
He said she told him that if he appraised it over $1 million, she would "send more business my way."
After conferring with Gossman, who was being directed then by FBI agents, they each came up with a $1.2 million appraisal, and an employee of Zwego drafted a new sales contract reflecting that price.
Neither appraiser had any contact with Shields and Cardarella during that process, according to their testimony.
The mortgage company employee Plagman dealt with did not say anything about pressuring Plagman during her testimony Thursday.
She was not charged, but her supervisor, Monty Kinman, is one of two defendants on trial with Cardarella and Shields, the former Jackson County executive.
However, much of the alleged fraudulent activity concerning the loan application process occurred while Kinman was on a two-week hunting trip in a wilderness area, according to testimony.
The trial is to continue this morning.