A federal judge has found former Kansas City area builder F. Jeffrey Miller violated the terms of his release from federal prison after hearing evidence Miller was involved in a new real estate scam, U.S. Attorney Barry Grissom said Monday.
In a 16-page order dated Nov. 26, U.S. District Judge Julie A. Robinson cited evidence that Miller lied to his probation officer about his involvement in a company called Tri-States Holding, LLC. She cited “substantial evidence about the fraudulent practices and transactions” by the company.
Miller, 53, will remain in custody awaiting sentencing. Miller was convicted by a jury of conspiracy to commit bank fraud, money laundering and criminal contempt. In August 2012, he was sentenced to six years in federal prison. He began supervised release Jan. 10, 2014.
During sentencing hearings, prosecutors submitted evidence that Miller began planning the new business while he was in prison. The business claimed to buy, refurbish and sell houses. In fact, Judge Robinson said in her order, the business was engaged in a “contract for deed scam.”
The company purchased more than 40 houses at Jackson County, Mo., tax sales and then advertised the houses for sale to low-income people in the urban core of Kansas City, Mo. The company advertised home ownership for just $500 down, sweat equity of no more than $2,000 in the form of cosmetic repairs including painting and clean up, and then monthly payments of $399. The buyers signed contracts for purchase prices in the $35,000 range.
Prosecutors presented evidence the company failed to complete promised repairs, performing shoddy repairs or virtually no repairs at all and then harassed and threatened buyers who ceased to make payments.
Judge Robinson ruled Miller violated four conditions of his supervised release by:
• Controlling the new company even though he was prohibited from working in any capacity involving authority in financial matters.
• Telling his probation officer that that he was a mere laborer at the new company when in fact he controlled the company.
• Making false monthly reports to the probation office that he was not committing any federal crimes.
• Making threats of bodily harm to a woman who purchased a house from the new company.
Miller is scheduled for sentencing Dec. 15 in U.S. District Court in Topeka.
In an earlier case, Miller, whose address then was listed as Stanley, Kan., was tried and convicted in a case involving a mortgage fraud scheme. At that time, he was operating a company named Star Land Development.
