Executive pleads guilty to defraud bank
Published 5:48 pm Tuesday, August 2, 2022
NEW ORLEANS – United States Attorney Duane A. Evans announced that ROBERT B. CALLOWAY, age 62, of Metairie, Louisiana, pleaded guilty today to conspiracy to defraud First NBC Bank, the New Orleans-based bank that failed in April 2017. CALLOWAY served as Executive Vice President of the bank.
According to court documents, CALLOWAY and other bank officers, including Bank President Ashton Ryan Jr. and Chief Credit Officer William Burnell, conspired together to conceal the financial condition of bank borrower Gary R. Gibbs from the First NBC Bank Board of Directors, auditors, and examiners. They falsely stated in loan documents that Gibbs was able to pay his loans with cash generated by his businesses, and they hid from the First NBC Bank Board of Directors, auditors, and examiners that Gibbs was only making his existing loan payments by getting new loans from First NBC Bank. Ryan, Burnell, and CALLOWAY also concealed the fact that they made loans to Gibbs to keep him and his companies off of month-end reports that went to the Board, auditors, and examiners. These month-end reports listed borrowers who were not paying their loans or whose accounts were overdrawn. By keeping Gibbs and his entities off of those reports, Ryan, Burnell, and CALLOWAY were able to conceal their scheme and thereby allowing them to continue lending to Gibbs despite his inability to pay his loans. CALLOWAY also completed loan review forms that were sent to external auditors in which CALLOWAY omitted material information about Gibbs and his inability to pay his loans.
CALLOWAY pleaded guilty to a superseding bill of information charging him with one count of conspiracy to commit bank fraud, in violation of Title 18, United States Code, Sections 1344 and 371. The maximum penalty that may be imposed at sentencing for this charge is up to five years in prison; a fine of up to $250,000.00 or the greater of twice the gain to CALLOWAY or twice the loss to any victim; and up to three years of supervised release. U.S. District Judge Eldon E. Fallon set CALLOWAY’s sentencing for March 16, 2023.
CALLOWAY had been previously charged in this case with codefendants Ashton Ryan, Jr., William J. Burnell, First NBC Bank Senior Vice President Fred V. Beebe, and bank borrower Frank J. Adolph. Ryan, Burnell, Beebe, and Adolph are scheduled for trial before Judge Fallon on January 3, 2023. Gibbs pleaded guilty in August 2020 to a bill of information charging him with conspiracy to commit bank fraud.
“Today’s guilty plea demonstrates that individuals like Mr. Robert B. Calloway who engage in fraudulent schemes that impact the security of financial institutions will be held accountable,” said Douglas A. Williams, Jr., Special Agent in Charge, FBI New Orleans. “We thank our partners from the United States Attorney’s Office, Eastern District of Louisiana; Federal Deposit Insurance Corporation, Office of Inspector General; and the Board of Governors of the Federal Reserve System, Consumer Financial Protection Bureau, Office of Inspector General for their strong partnerships in protecting the integrity of the American banking system.”
“Today’s guilty plea demonstrates that the FDIC OIG and our law enforcement partners continue to investigate and hold accountable criminals who defraud our insured financial institutions and cause harm to our nation’s banking industry,” said Anand Ramlall, Special Agent in Charge, Dallas Region, Office of Inspector General for the Federal Deposit Insurance Corporation.
“Today’s plea sends a clear message that bank executives who commit fraud and deliberately deceive regulators will be brought to justice for their actions. I commend our agent and their federal law enforcement partners for their hard work and persistence, which ultimately led to this outcome,” said Stephen Donnelly, Acting Special Agent in Charge, Eastern Region, Office of Inspector General for the Board of Governors of the Federal Reserve System and the Bureau of Consumer Financial Protection.
This case is being investigated by the Federal Bureau of Investigation; the Federal Deposit Insurance Corporation, Office of Inspector General; and the Board of Governors of the Federal Reserve System, Consumer Financial Protection Bureau, Office of Inspector General. Assistant U.S. Attorneys Matthew R. Payne, Nicholas D. Moses, J. Ryan McLaren, and Rachal Cassagne are in charge of the prosecution.