By Ogozi John
A senior loan officer at a TARP-recipient bank has been convicted on five counts of wire fraud, according to an announcement by John W. Vaudreuil, United States Attorney for the Western District of Wisconsin and Christy Romero, Special Inspector General for TARP.
David Weimert , 64, of Madison, Wis., served as the senior vice president in Lending Administration of Anchor BanCorp Wisconsin, Inc. (ABCW) and as the president of Investment Direction Inc. (IDI), a subsidiary of ABCW.
Weimert used his position to defraud the bank in order to obtain ownership stakes and receive commission in the sales of properties which the bank sold to raise funds to remedy financial trouble during the financial crisis.
Evidence in court also revealed how Weimert lied and misrepresented facts in order to gain an ownership interest and a 4% commission fee in the sales of Chandler Creek, a joint venture partnership to develop an industrial park in Round Bank, Texas.
In a testimony by his bank supervisors, Weimart reported that Burke Group, a California-based real estate developer, gave the condition they would only purchase IDI’s share of Chandler Creek if Weimart would also purchase a minority interest in Chandler Creek.
But Weimart did not tell the Board of Directors that he actually desired to own a minority interest for himself, and not as a demand by the Burke Group.
Based on this misleading information, IDI’s Board approved the Burke’s group offer, and Weimert received 4.785% interest in Chandler Creek and pocketed $311,680 as 4% commission fee from the sale.
In January 2009, ABCW, the parent company of Anchor Bank, received $110 million through the Troubled Asset Relief Program. In August 2013, Anchor Bank filed for bankruptcy and the federal government suffered a loss of $104 million on the investment and another $23 million that was owed to TARP.
Weimart now faces up to 20 years in prison on each count; sentencing has been scheduled for June 16 by U.S. District Judge James D. Peterson.