Search This Blog

Thursday, March 7, 2013

Eddington Pleads Guilty to Fraud, Embezzlement in Missouri

Irvin R. Eddington Jr., 42, former vice president and manager of the Ellington Branch of Peoples Community State Bank, entered a guilty plea last week in U.S. District Court to charges of bank fraud and embezzlement.
Attorneys say Eddington created fraudulent PCSB money orders in the amount of approximately $49,000 funded by advances from customer lines of credit and forging the customers names to obtain cash or to pay his bills.Also, from January 2004 through October 2011, prosecutors say Eddington created and issued a number of fraudulent unsecured irrevocable letters of credit to an associate in the name of the bank worth approximately $1,340,896.
Based on loan defaults to date, PCSB is liable for approximately $674,336 of the potential $1,340,896 loss.
Sentencing for Eddington has been set for May 20, 2013, by U.S. District Judge Carol E. Jackson. The penalty for each of the two charges is a maximum of 30 years imprisonment and up to $1 million in fines.
The charges were originally filed Sept. 19, 2012, but Eddington’s lawyer filed a motion to dismiss the second count of the indictment.
Judge Jackson referred all pretrial matters in this case to United States Magistrate Judge Lewis M. Blanton in the Cape Girardeau office for determination and recommended disposition, where appropriate.
On Dec. 12, 2012, Judge Blanton filed a report and recommendation with respect to the defendant’s motion to dismiss Count Two of the indictment. The defendant filed timely objections to which the United States has responded.
Magistrate Blanton found, and Judge Jackson agreed in an opinion delivered Feb. 4, that the allegations in Count Two are sufficiently specific to apprise the defendant of the conduct that is deemed unlawful. Further, the factual allegations, if proved, would be sufficient to establish a violation of federal law.
Following the denial of the defense’s motion to dismiss the second charge, Eddington agreed to plead guilty to both charges.
In addition to charges previously described, Eddington also admitted to perpetrating additional fraudulent schemes on PCSB as reported by the Daily American Republic on Friday, March 1.
On March 11, 2010, Eddington, in an effort to circumvent Federal Reserve regulations governing insider lending to bank officers, approved a nominee loan to two customers on the bank for $45,000.
He reported the loan to PCSB; however, did not report he was receiving the proceeds of the loan. The loss to PCSB for this scheme was $58,500.
On Aug. 4, 2011, the PCSB loan committee approved a $249,000 loan to an associate of Eddington, who misrepresented collateral for the loan by providing a fraudulent title insurance policy as part of the loan application.
Finally, when the $249,000 loan was presented for approval, Eddington failed to disclose that the associate would receive $56,114 cash from the loan proceeds.
The loan committee would not have approved the loan had they known the loan was “secure” by different property, the lack of title insurance and the cash payout to the borrower. This loan went into default and was charged off by the bank.

No comments:

Post a Comment