A former Canton resident who authorities say was part of a multimillion dollar conspiracy to defraud the failed FirstCity Bank of Stockbridge was sentenced to 12 years in federal prison and banned for life from the banking industry.
Mark A. Conner, 46, whose positions with the bank included vice chairman, acting chairman, president and CEO, was also ordered to pay $19.5 million in restitution to the Federal Deposit Insurance Corp. and victim banks, the United States Attorney's Office announced this week. And he agreed to forfeit $7 million, including $1.7 million in cash and interests in multiple pieces of property in Georgia and Virginia.
“Our state, which leads the nation in bank failures, is still recovering from a banking crisis of epic proportions,” United States Attorney Sally Quillian Yates said. “These failures have a ripple effect in every workplace and household in the state. This sentence should serve as a warning that regardless of your position or the complexity of your scheme, bank officers and directors who place FDIC-insured funds at risk through fraud and self-dealing will be brought to justice.”
More than three years have passed since state and federal authorities seized FirstCity on March 20, 2009.
Exactly two years later, under a March indictment against him and vice president Clayton A. Coe, Conner was arrested at Miami International Airport as he returned from the Turks and Caicos Islands. He has been in federal custody ever since.
Yates says the men and others tricked the bank’s loan committee and board into approving approving multiple multimillion dollar commercial loans to borrowers who were actually purchasing personal property owned by Conner and Coe.
The bank's loan committee and board of directors didn't know that the men owned the property.
Between February 2006 and February 2008, the scheme yielded more than $5 million for Conner and his conspirators, federal authorities said.
The conspirators’ lies led 10 other federally insured banks to invest in the fraudulent loans, spreading the damage, the indictment says.
FirstCity unsuccessfully sought federal assistance through the federal Troubled Asset Relief Program to avoid being shut down. Regulators reported finding the fraud after taking over the bank.
At the end of his prison sentence, Conner will be under five years of supervised release.
Coe of McDonough pleaded guilty June 26 "to bank fraud in connection with an $800,000 loan that he tricked FirstCity Bank’s Board of Directors into approving and from which he personally profited. He also pleaded guilty to filing a false federal income tax return with the IRS that omitted nearly a half million dollars of income from his job at the bank," Yates said in a news release at the time.
Coe's sentencing is scheduled for 10 a.m. Sept. 18 before United States District Judge Steve C. Jones.
WHAT OTHERS ARE SAYING
- Brian D. Lamkin, Special Agent in Charge, FBI Atlanta Field Office—“The public is absolutely demanding that individuals such as Mr. Conner, who abused his position as a bank executive for personal gain, be held accountable for their criminal actions. With today's lengthy prison sentence, Mr. Conner is indeed being held accountable. The FBI will continue to provide investigative resources and work with our law enforcement partners in identifying, investigating, and presenting for prosecution such individuals who engage in such large scale fraud schemes that target the banking industry.”
- Christy Romero, acting special inspector general for the Troubled Asset Relief Program—“The financial crisis unveiled fraud that had been ongoing for years, as shrinking capital and increasing delinquent loans left fraudulent bank executives with nowhere to hide. This CEO and Chairman of failed FirstCity Bank had been committing fraud against the bank since 2004, directing bank loans to buy land where Conner was the disguised owner and causing the bank to fund draws on construction/development loans for his benefit or to keep other bank loans current. As the real estate market declined, Conner schemed to take foreclosed properties off the bank's books through sales to straw purchasers, concealing that the bank funded the purchases. The Court's sentence of 12 years in prison reflects the great lengths Conner went to lie to bank regulators and to cheat the bank, as well as the significance of his unsuccessful attempt to steal more than $6 million in TARP funds to cover his tracks.”
- FDIC Inspector General Jon Rymer—“Today’s sentencing of Mr. Conner reflects fitting punishment for an individual who intentionally and selfishly undermined the integrity of the financial services industry. The American public can be assured that the Federal Deposit Insurance Corporation Office of Inspector General will continue to do all it can to protect the viability of the Deposit Insurance Fund and will seek justice for others who have perpetrated similar frauds affecting insured depository institutions throughout the country.”