A federal judge Thursday sent two women to prison for scamming 155 people out of $125,794 by offering them phony credit-repair services and access to federal grant money that didn't exist during a 6 1/2-year period ending in 2011.
U.S. District Judge D. Price Marshall Jr. sentenced Tiffany Rene Morris of Southaven, Miss., to just over three years in prison and Sherrye LaJoyce Mance, who lives near Pine Bluff in Grady, to 14 months for a wire-fraud conspiracy they carried out from September 2004 through March 2011.
Mance, 50, pleaded guilty to the conspiracy charge Feb. 15 and agreed to testify against Morris, 43, who was convicted Feb. 26 by a federal jury on the conspiracy charge and six individual mail-fraud counts.
Before being indicted in early 2014, the women were pursued by the Arkansas attorney general's office in a civil lawsuit. That resulted in a 2009 finding by U.S. District Judge Susan Webber Wright that they violated the state's Deceptive Practices Act. Wright issued an injunction ordering them to stop offering the phony services, for which they generally charged a minimum of $250, and to repay the victims -- along with $700,000 in civil penalties, roughly $5,000 for each violation known at that time.
However, the women never showed up for court or acknowledged the injunction, and they continued their operation under a new name until authorities caught up with them.
The women initially operated as Financial Services Unlimited, Service Unlimited Inc. and Credit Counseling Service, catering to customers in Arkansas and surrounding states. After the injunction was issued, they renamed their operation Fresh Start and added California residents to their roster, according to court documents.
The documents cited Internet advertisements in which the women proclaimed, "We do not engage in any unethical practices, nor are we associated with any credit-repair quick-fix schemes."
In the courtroom, each painted the other as the mastermind of the scheme, but on Thursday, Assistant U.S. Attorney Anne Gardner told Marshall that Mance had a lesser role than Morris.
It was Morris, Gardner said, who initiated the ploy to entice people into paying the women through cashier's checks or Money Gram transfers for unspecified services that would improve their credit scores, enabling the clients to obtain lower-interest loans or federal funds to help them pay off debts or attend college.
At the trial, several victims testified. One of them, Clara Collins of Little Rock, said she and her husband, Kenneth, each paid Mance $550 for credit-repair services while they were seeking a construction loan to build a house. She said Mance instructed her not to contact the credit bureau to check on her credit score or it would "mess up" her efforts.
Collins testified that after a bank officer told her husband their credit score hadn't changed, her husband confronted Mance, who scolded him and talked him into paying her another $1,100 to get the couple "re-enrolled" in the nonexistent program.
Little Rock attorney Mike Spades represented Morris, who is also known as Tiffany Vann. He argued in a pre-sentencing memorandum that she was "the sole caregiver for her orphaned nephew" and asked the judge to sentence her below the 37- 46-month range suggested by federal sentencing guidelines so that she could raise the child, whose mother, Morris' sister, died a year ago. Spades argued that the child "has no other family members who can provide him with the continuity of care, nurture and supervision that he receives from Ms. Morris."
Marshall denied the request, sentencing Morris to 37 months, to be followed by three years of supervised release.
In Mance's sentencing hearing, defense attorney Jack Kearney of Little Rock asked that Mance, who also has used the names Joyce Collins and Sherrye Collins, receive a probationary sentence instead of prison time so that she can take care of her mother, who attended the hearing in a wheelchair, and her father, who suffers from Alzheimer's disease.
Although prosecutors didn't object to the request, Marshall again refused, saying, "This scheme troubles me greatly because of the people who money was taken from, and the fact that it was grocery money." He also noted that the civil suit "was a huge stop sign in the road, and you all went past that."
Marshall told Mance that she won't have to report to prison until Oct. 5, giving her about two additional months to prepare than most defendants who aren't in custody get, "so you can allow other caregivers to step in for your mom and dad." He also ordered her to serve three years on supervised release after prison.
The judge's announcement that he would impose a prison sentence prompted an emotional outburst from two family members sitting in the front row of the courtroom, although Mance appeared calm, as did her mother.
Marshall ordered the women to pay the restitution jointly and severally, meaning both are held responsible for the total.
Metro on 06/26/2015