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Guilty.
That was the plea Mark A. Conner, formerly president of FirstCity Bank of Stockbridge, Ga., entered last week in federal court in connection with charges of conspiracy to commit bank fraud and perjury, according to a U.S. Department of Justice statement.
According to the charges and other information presented in court, Conner and others tricked the bank's loan committee and board of directors into approving multiple multi-million-dollar commercial loans to borrowers who actually were purchasing property owned by Conner or his co-conspirators. At least 10 other banks also allegedly invested or participated in the fraudulent loans based on the conspirators' misrepresentations.
The gang also is accused of trying, though unsuccessfully, to get federal government assistance through the U.S. Treasury Department's Troubled Asset Relief Program, or TARP, and allegedly engaged in other misconduct to try to avoid seizure of the bank by regulators and prevent discovery of the fraud.
Sally Quillian Yates, U.S. Attorney for the Northern District of Georgia, said in the statement Connors had "treated FirstCity Bank's commercial real estate lending operations like his own personal piggy bank, siphoning off millions of dollars from fraudulent commercial real estate loans, ultimately running FirstCity into the ground."
Georgia has suffered more than 70 bank failures since mid-2008, and the latest was just this month. Federal and state authorities seized FirstCity Bank in March 2009. Conner has been in custody since March 2011, when he was arrested at Miami International Airport upon his arrival from the Turks and Caicos Islands in the West Indies.
Conner, who allegedly reaped almost $7 million from the fraudulent loans, filed a bankruptcy petition in January 2010, stating that he had approximately $3,000 in cash and financial accounts and essentially no unencumbered interests in real estate. He then testified under oath that his petition was true and accurate and that he was "down to less than nothing."
Federal agents found that he controlled off-shore accounts containing more than $545,000 and that $4 million in real estate investments from his off-shore accounts wasn't disclosed in his bankruptcy petition or testimony.
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