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Wednesday, October 6, 2010

Texas Bank exec to plead guilty

A former La Coste National Bank vice president plans to plead guilty to a charge of embezzling $30,000 from the financial institution. Mary Magdalene Crawford is scheduled to plead guilty Thursday to the alleged embezzlement scheme, which was detected in February after the bank was shut down by regulators because of unrelated fraudulent activity.
John Kuntz, Crawford's lawyer, said he anticipates his client will be placed on probation given that she has no prior criminal history and she already has raised at least half of the $40,000 she would have to pay in restitution. The sentencing guidelines call for a prison term of six to 12 months, Kuntz calculated. The charge carries a maximum sentence of 30 years and a maximum fine of $1 million.“She admitted to the wrongdoing all along,” Kuntz said. “She's very sorry for it.”The Office of the Comptroller of the Currency closed La Coste National Bank and the Federal Deposit Insurance Corp. was appointed receiver on Feb. 19. About two months later, Jody P. Gwyn, La Coste's former president, was indicted on charges he caused more than $7.3 million in losses at the bank. Plea negotiations are under way, though Gwyn has denied personally profiting.According to a plea agreement filed in Crawford's case on Friday, Crawford stated she fraudulently prepared 10 cashier checks worth $3,000 each and used the money to pay bills. Most of the checks were cashed in the last quarter of 2009.
Crawford balanced the bank's cashier's check account by withdrawing money from a customer's individual retirement account, the plea agreement states. She later reversed the transaction on Feb. 10.
The plea agreement states Crawford also stole $10,000 from the bank's vault, though that charge will be dropped as part of the plea. The money will be repaid as part of the restitution, however, Kuntz said.
Kuntz said Crawford had no knowledge of the fraudulent activity that led to the bank's closure.

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