A Franklin couple has been charged with fraud and money laundering in what law enforcement officials said was a scheme to defraud an elderly woman with dementia of $1.7 million.
According to a news release from the U.S. Attorney’s Office of the Middle District of Tennessee, 63-year-old Karl Hampton and his wife, 59-year-old Deborah Hampton, were arrested by Federal Bureau of Investigation agents at their Franklin home and were scheduled to appear before a U.S. Magistrate Judge on Wednesday.
Karl Hampton has been charged with wire fraud and money laundering while Deborah Hampton is only charged with money laundering.
According to the news release, Karl Hampton met an unidentified elderly widow while he was working as an exterminator for a Belle Meade-based pest control company and provided extermination services at the woman's home from January 2016-May 2019.
Prosecutors allege that beginning in January 2018, when the victim was 85, until around June 2020, Karl Hampton defrauded the woman and various financial, credit and loan-issuing institutions by deceiving the woman into believing that he was her son or godson and that he would care for her.
Prosecutors allege that Hampton convinced the woman to sign over her power of attorney and name him in her revocable living trust and her will.
"Karl Hampton methodically drained the woman’s bank accounts, took out a $500,000 line of credit in her name using her securities as collateral, and amassed huge charges on her credit cards for his own personal expenses, all under the false pretenses that he had a valid POA, that he was entitled to her money and property, and that he was acting for her benefit and in her interest," the news release states.
In April 2019, prosecutors allege that Hampton brought his wife into the scheme naming her as the successor agent in documents that handed control of the victim's assets over to the couple.
Prosecutors also said that after successfully gaining control of the victim's assets, Hampton quit his job and "thereafter continued to drain the woman’s bank accounts to fund his lavish lifestyle."
The elderly victim fell and was injured in June 2019 and was admitted to Williamson Medical Center before being admitted to an assisted living facility, where she was reportedly malnourished and later diagnosed with dementia.
Prosecutors allege that Hampton listed himself as her "son" and an emergency contact with the hospital and assisted living facility, as well as fraudulently identifying himself as the victim's "son " or "personal assistant" to several financial institutions.
Prosecutors said that in December 2019, Karl Hampton took out a $500,000 line of credit in the victim's name, and in addition wrote checks to himself, purchased cashier’s checks, took out cash withdrawals and transferred money out of the victim's bank account and into a bank account in the name of Falcon Company, which he set up and controlled.
Then in January 2020, prosecutors said that Hampton used $170,000 of the money from the line of credit to purchase an ownership interest in his own name in a Franklin-based pest control business, as well as renting an apartment in Murfreesboro under the victim's name while she was still living in an assisted living facility.
Prosecutors allege that Hampton took approximately $1,240,438.06 from the victim, and frequently purchased luxury items such as a Lexus SUV and jewelry, as well as frequently spending between $1,000 and $1,500 per day on lottery tickets.
Hampton is also accused of liquidated two investment accounts of the victim’s deceased sister in the amount of $246,645 and used the money for his own benefit.
If convicted, Karl Hampton faces up to 20 years in prison and Deborah Hampton faces up to 10 years.