Bank fraud can be a complicated crime, but that doesn't mean that it happens only to large banks in big cities. It could even happen in South Carolina. FirstCity Bank, a small bank based in suburban Atlanta, was no exception.
FirstCity Bank recently failed due in large part to bank fraud. Mark Conner, the former president of FirstCity, has pled guilty to perjury and conspiracy to commit bank fraud. Perjury, the act of lying under oath, is a charge commonly involved in bank fraud cases.
The perjury charge stemmed from Conner's filing for bankruptcy earlier this year. The former bank president persuaded people to buy property by offering them loans for which they were unqualified, promising that they could get 100 percent financing and could buy the property without giving the bank a penny in return. But Conner lied about information on the loan applications, indicating that the buyers put money down when they actually did not.
This is an important factor because banks give loans based on the ability of people to pay back the money they borrow. Stating on a loan application that people paid money when they in fact did not creates a false impression of their ability to pay back the loan. This means that a bank will issue a loan based on false information. Sometimes the people borrowing the money will not be able to pay back the loan. A bank can lose a lot of money this way.
Conner also convinced people to buy properties that he himself owned. Once buyers borrow the money from a bank to buy a property, they give that money to the seller - in this case, Conner. So Conner might as well have taken millions of dollars in cash directly from the bank, because he was illegally pocketing the money that the bank was loaning to the buyers, and thus committing bank fraud.
Conspiracy and Bank Fraud in South Carolina
Bank fraud is one of many crimes that can happen at the same time as conspiracy - and again, South Carolina is no exception. For example, in one case, a South Carolina man was convicted of conspiracy to commit mail fraud in conjunction with a mortgage loan. This means that although he may not have actually completed the fraud, the defendant at the very least made a plan with someone else to use the mail to take money from someone by lying. This, too, is a federal crime.
The man pled guilty to lying on loan applications, claiming that he intended to live in the property he was buying - a claim that usually means a buyer has to give the bank a smaller down payment. When the man actually got the loan, he resold the property without ever living in it, resulting in a larger profit when the next buyer bought the property. Though this may not seem significant when it happens only once, the South Carolina man did it 20 times and pocketed more than $2 million.
In another case, a South Carolina man, along with a man from North Carolina, pled guilty to bank fraud yet again involving investment property. In this case, the two men got together and lied on loan documents, claiming that the South Carolina man was working for the man from North Carolina and earning $15,000 per month, which was not true. The loans they were able to obtain with this lie exceeded $1 million.
