Court Sentences Former Wilmington Trust Chief Credit Officer and Controller to Imprisonment

[nitpicker]

https://www.justice.gov/usao-de/pr/court-sentences-former-wilmington-trust-chief-credit-officer-and-controller-imprisonment

Department of Justice
U.S. Attorney’s Office
District of Delaware

FOR IMMEDIATE RELEASE
Wednesday, December 19, 2018

Court Sentences Former Wilmington Trust Chief Credit Officer and Controller to Imprisonment

WILMINGTON, Del. – David C. Weiss, United States Attorney for the District of Delaware, announced today that the Honorable Richard G. Andrews sentenced former Wilmington Trust Chief Credit Officer William North, age 59, to 54 months’ imprisonment and a $100,000.00 fine. Judge Andrews also sentenced former Wilmington Trust Controller Kevyn Rakowski, age 65, to 36 months’ imprisonment.

The sentencing hearings of North and Rakowski followed those of Robert Harra, age 69, the Bank’s former President; and David Gibson, the Bank’s former Chief Financial Officer, age 61. On Monday, December 17, 2018, Judge Andrews sentenced both Harra and Gibson to 72 months imprisonment and a fine of $300,000.00. The Court also ordered all four Defendants to agree to a ban from the banking industry and to surrender to the custody of the Bureau of Prisons by February 19, 2019.

A federal jury convicted each of the Defendants in May 2018, following a two-month trial. The jury returned guilty verdicts on sixteen counts of the Third Superseding Indictment, including conspiracy, as well as fifteen fraud, false statements, and false entries offenses. The jury also convicted Gibson on three additional counts of making false certifications in financial reports.

At trial, the government proved that the defendants conspired to falsely report the Bank’s amount of past due loans to regulators, investors, and the public. The government presented evidence that the Defendants caused the Bank to underreport approximately $300 million in past due loans in the Third and Fourth Quarters of 2009 in Call Reports and Monthly Regulatory Reports filed with the Federal Reserve and in Securities Filings with the Securities Exchange Commission. The Bank used the false Securities Filings to raise $287 million in a February 2010 stock sale.

When the Bank finally began reporting its past due loan information correctly in the Third Quarter of 2010, it recognized losses of over $370 million and its share price plummeted. On November 1, 2010, M&T Bank announced that it had acquired Wilmington Trust at a sharply-discounted price. The Wall Street Journal referred to the acquisition as “one of the biggest banking firesales in history.” Over 700 Wilmington Trust employees lost their jobs as a result of the merger.
(snip)

[TexasTowelie]

1. I've been following this case over the past few months.

It's nice to know that these executives are receiving a substantial amount of time in prison, although I also think that they deserve more than they were sentenced.

[3Hotdogs]

2. What da fuck? Bankers aren't supposed to go to jail.

Ask Eric Holder. He'll tell ya.