It may be true that the purest of plans often go awry, as it seems to have been the case for a Minnesota bank president whose efforts to save a failing bank has led to a conviction for white-collar crimes. Ultimately, however, a federal district court judge gave the man a light sentence, noting he has led an “exemplary life” and is known for community service and philanthropy. He will not have to pay any fines nor make restitution.
Hired as the bank’s president after the bank had been open just three years, he brought along a banking customer who wrote checks between various business accounts at two banks, leaving a trail of back checks totaling $1.9 million. The bank president sought to use bank funds to cover the expected overdrafts from the bad checks. His plan involved the help of five straw borrowers, taking out a total of $1.9 million in loans. For this, he was sentenced to 3 1/2 years in prison, far less than the 10-year sentence sought by prosecutors.
While prosecutors argued that the banker put the bank at risk, his own attorney described his motive as “pretty pure,” saying that it was his intention to save the bank. He argued that his actions were perhaps a “temporary lapse of judgment” at worst. During the trial, the man’s family and friends filled the courtroom in a show of support.
The businessman responsible for writing the bad checks was sentenced the day before. He too received a 3 1/2-year sentence. A third defendant was acquitted months before.
The small bank has since been closed by state regulators, with the Federal Deposit Insurance Corporation selling it to another bank.
While the bank president’s life of public service and failed attempts at saving the bank protected him from an overly harsh punishment, this is relatively rare for people accused of white-collar crimes. It is very possible that he could have been sentenced to much more time in prison or forced to pay an exorbitant fine.
Source: Star Tribune, “Ex-Pinehurst Bank chief gets prison for scam role,” Jennifer Bjorhus, Sept. 22, 2012
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