Ex-MBA President Pleads Guilty To Defrauding Fannie Mae

Ronald McCord, former Mortgage Bankers Association (MBA) president and founder of Oklahoma City-based First Mortgage Company (FMC), pleaded guilty to a slew of charges including defrauding Fannie Mae.

McCord, 71, was indicted by a grand jury in June 2020, with charges including bank fraud, money laundering, and making false claims to a financial institution. McCord pleaded guilty to five of the twenty-four charges. McCord served as MBA president in 1997, at which time the position was a volunteer role.

In the plea hearing, McCord admitted to defrauding Spirit Bank, Citizens State Bank, and their respective residential mortgage subsidiaries. An independent audit showed McCord had sold more than $14 million in loans “out of trust,” failing to repay when certain loans were refinanced or paid off. At the time, FMC’s lines of credit carried outstanding balances totaling $340 million.

McCord further admitted to making materially false statements and representations to CapLOC in a bid for quick funding after Spirit and Citizens cut him off. 

Finally, FMC serviced 12,000 loans for Fannie Mae, through which McCord defrauded the company by using escrow money intended to pay homeowner’s taxes for FMC’s operating expenses. He laundered the proceeds by wiring it to a custom home builder as payment for work on his Colorado home.

“This was a carefully calculated scheme by which the defendant defrauded local banks out of tens of millions of dollars, made false statements to a financial institution, diverted escrow monies intended to pay homeowners’ taxes and insurance premiums to cover his company’s operating expenses, and then laundered the proceeds to fund his lavish lifestyle,” acting U.S. attorney Robert Troester said in a statement.

The judge determined that McCord had caused the loss of more than $95 million to local and national financial institutions and to local borrowers. McCord will self-surrender on January 6 for his prison sentence, after which McCord will be on probation for three years.

The investigation was conducted by the FBI’s Oklahoma City office, as well as the offices of inspector general at both the Federal Housing Finance Agency and the Federal Deposit Insurance Corporation.