Crime & Safety

Women Sentenced to 10 Years Each in Prison for Mortgage Fraud Scheme

Patricia Johnson of Naperville and Pamela Williams of Darien pleaded guilty in April.

Pamela Williams and Patricia Johnson were each sentenced Monday to 10 years in prison for their roles in a $6 million mortgage fraud scheme. They were also ordered to pay a $1.8 million judgment. 

Williams, 58, of Darien, and Johnson, 57, of Naperville, to using Williams’ Wheaton-based company, PLM Title, to defraud home buyers and refinance the money meant to pay off their previous mortgages. Johnson was a silent partner in the venture.

Instead of using the money for its intended purpose, the two women used the funds for both personal and business operating expenses, according to State’s Attorney Robert Berlin.

Find out what's happening in Napervillewith free, real-time updates from Patch.

“It’s shameful, pitiful and, frankly, quite disgusting because they didn’t need to do it,” said Judge John Kinsella during Monday’s sentencing.

Much like a Ponzi scheme, money paid by new clients was used between 2002 and 2008 to float the business and pay off the mortgages of older clients, according to Wheaton Police Detective David Zadan, the the lead investigator on the case. 

Find out what's happening in Napervillewith free, real-time updates from Patch.

Assistant State’s Attorney Diane Michalak said the women also used the monies for lavish parties, remodeling projects and Chicago Bears season tickets.

An audit showed PLM made about $4.1 million between 2005 and 2008, while it paid out roughly $7.6 million in expenses during the same time period, Zadan said. About $3 million was transferred from the company’s escrow account into other accounts, he said.

Williams’ income was about $145,000 during those same years, but Zadan said the audit revealed her expenses were about $474,000.

Williams shuttered PLM Title, which also had locations in McHenry County, Olympia Fields and Merrillville, IN, in April 2008.

The 2 1/2-year investigation began in April 2008 after a PLM client’s attorney approached the Wheaton Police Department about the unusual activity, Zadan said.

Seven victims testified about the financial and emotional trauma they suffered as a result of the scheme.

The stories shared similar themes—phone calls days after the closing alerting the victims to bounced checks, threats of foreclosure, ruined credit.

Christine Michaud of Carol Stream testified that she and her husband decided to refinance their home in 2008 after her husband lost his job.

The day she mailed the first payment to the new lender, she said she received a notice of late payment from her previous lender.

After several calls to PLM Title, a representative said they would issue a new check to the old lender. 

Days later, she received a call from the bank saying there had been a stop payment put on the check.

“I was hysterical,” Michaud said. “I didn’t know what to do,” adding that she spent more than a year trying to avoid foreclosure, she said.

Although insurance companies have paid back some of the victims, Michaud said she hasn’t received any compensation.

Disabled veteran Lawrence Grezlik said that he used most of a $50,000 government grant to make his home wheelchair accessible. He left the remaining $6,900 in escrow with PLM to help pay off his mortgage. 

The money, however, was never paid to his lending bank.

With no savings and his credit destroyed, Grezlik said he is devastated.

“My wife worries about me because I’m just on the edge,” he said. 

Johnson’s attorney, Mark Kowalczyk, portrayed his client and Williams as two women just trying to keep their business afloat.

“It was never my intention to amass personal wealth,” a tearful Johnson said. “… If I could right the wrongs that were done, I would.”

Kinsella said there was no excuse for the scheme, even if it was intended to keep the business alive.

“I would consider a life sentence if that would make [this situation] better,” he said.

Instead, the two women were sentenced to 10 years in prison on each Class 1 felony and five years on each Class 3 felony, to be served concurrently. They were sentenced to two years of mandatory supervised release after their jail time is done.

They have 30 days to withdraw their guilty plea from April.

Retired accountant Kenneth Braatz, another victim of the scheme, said that he was relieved following Monday’s sentencing. 

Braatz refinanced his Ogden Dunes, IN, home in 2008. Shortly after closing, he said he got a call that the last payment on his previous mortgage hadn’t been paid. The scheme held him liable for two mortgages worth $800,000, he said. 

“As the judge said, they knew what they were doing was wrong,” Braatz said. “You just don’t steal from one to give to someone else.”


Get more local news delivered straight to your inbox. Sign up for free Patch newsletters and alerts.

We’ve removed the ability to reply as we work to make improvements. Learn more here

To request removal of your name from an arrest report, submit these required items to arrestreports@patch.com.