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Related: About this forumFormer CEO of $3 Billion TierOne Bank Sentenced to 11 Years in Prison
Department of Justice
Office of Public Affairs
https://www.justice.gov/opa/pr/former-ceo-3-billion-tierone-bank-sentenced-11-years-prison-orchestrating-scheme-hide-more
FOR IMMEDIATE RELEASE
Wednesday, March 23, 2016
Former CEO of $3 Billion TierOne Bank Sentenced to 11 Years in Prison for Orchestrating Scheme to Hide More than $100 Million in Losses from Shareholders and Regulators
The former CEO of TierOne Bank, a $3 billion publicly-traded commercial bank formerly headquartered in Lincoln, Nebraska, was sentenced to 132 months in prison today for orchestrating a scheme to defraud TierOnes shareholders and to mislead regulators by concealing more than $100 million in losses on loans and declining real estate.
(snip)
Gilbert G. Lundstrom, 74, of Lincoln, was sentenced by U.S. District Judge John M. Gerrard of the District of Nebraska, who also ordered Lundstrom to pay a $1.2 million fine. The court deferred entering a restitution order until after sentencing. On Nov. 6, 2015, after a two-week jury trial, Lundstrom was convicted of 12 of 13 counts charged, including conspiracy to commit wire fraud and securities fraud, conspiracy to falsify bank entries, wire fraud, securities fraud and falsifying bank entries.
(snip)
According to the evidence presented at trial, Lundstrom designed an aggressive strategy to expand TierOnes portfolio beyond traditional lending in Nebraska to riskier areas, including commercial real estate in Las Vegas, which decimated the bank once the financial crisis hit. Trial evidence showed that Lundstrom and his co-conspirators then intentionally concealed more than $100 million in losses in TierOnes loan and real estate portfolio from investors and regulators and provided inflated figures in its required reports to the U.S. Securities and Exchange Commission (SEC) and the Office of Thrift Supervision. In April 2009, Lundstrom and his co-conspirators learned that TierOne needed to increase its reserves and loan loss allowance by between $34 million and $114 million, but concealed this information from shareholders and regulators in TierOnes financial statements, the evidence showed. In addition, trial evidence demonstrated that during TierOnes annual shareholder meeting held on May 21, 2009, Lundstrom misrepresented the state of TierOnes capital ratios and reserves and whether TierOne had applied for TARP funding.
In June 2010, following TierOnes ultimate disclosure of $120 million in loan losses and its subsequent delisting from the NASDAQ exchange, TierOne was shut down by the Federal Deposit Insurance Corporation. At the time of the closure, TierOne had more than 750 employees working at its headquarters in Lincoln and its 69 branch offices located in Nebraska, Iowa and Kansas.
In 2014, co-conspirators James Laphen, 67, of Omaha, TierOnes former president and chief operating officer, and Don Langford, 65, of College Station, Texas, TierOnes former chief credit officer, pleaded guilty to multiple felonies in connection with their participation in the scheme. Laphen and Langford are scheduled to be sentenced tomorrow by Judge Gerrard.
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Former CEO of $3 Billion TierOne Bank Sentenced to 11 Years in Prison (Original Post)
nitpicker
Mar 2016
OP
awoke_in_2003
(34,582 posts)1. Oh, he screwed shareholders and not regular people
that is why he is going to prison.
valerief
(53,235 posts)3. Bingo, and that's the ONLY reason. nt
hibbing
(10,076 posts)2. My neighbor worked there
Hope he didn't get totally screwed over in terms of any kind of retirement savings plan stuff. Luckily, he found another job rather quickly.
Peace
davidthegnome
(2,983 posts)4. Shocking.
Look at that, a sociopath acting like a sociopath.
sueh
(1,818 posts)5. Good! I'm glad some of these crimininals are finally going to prison. Just need more of them to go.
MrScorpio
(73,626 posts)6. I'm all for jailing bankers...
It's not done enough for my tastes.
joshdawg
(2,638 posts)7. Jail time is not enough. A fine added to that is still not enough.
ALL his money needs to be taken from him AND his family. No one associated with him should have access to ANY of the monies he has bilked from people. He needs to be made poor as a churchmouse. Then and only then will these %^**(&^ learn their lesson.
Moostache
(9,895 posts)10. Amen! (N/t)
Punx
(446 posts)11. Meanwhile while driving with out of state plates in Nebraska
Expect this:
http://www.democraticunderground.com/10141394922
Two different sets of rules for sure.
CanonRay
(14,038 posts)8. Good. One down, how many hundreds more to go... n/t
SHRED
(28,136 posts)9. And if you're Goldman Sachs...
...well...you know.