Former Valley Bank Executives Plead Guilty
Three former executives of Valley Bank in the Quad Cities have pleaded guilty to defrauding the Small Business Administration of 4.5 million dollars.
The US Department of Justice says they include 70 year old Larry Henson of Davenport, former President and Chairman of Valley Bank; 43 year old Andrew Erpelding, also of Davenport, and former Vice President and Regional Manager of Valley Bank; and 68 year old Susan McLaughlin, Bettendorf, she's the former Vice President for Credit Administration of Valley Bank.
They worked with the president of a lending service provider in Des Moines, who has also pleaded guilty.
Prosecutors say they altered loan payment histories, renamed businesses, and hid the fact that borrowers had previously defaulted on loans. When the fraudulently guaranteed loans defaulted, the defendants shifted the majority of losses on the ineligible loans to the SBA.
All four defendants pleaded guilty to conspiracy to commit wire fraud affecting a financial institution. They each face a maximum penalty of 30 years in prison. A federal district court judge will determine any sentence after considering federal sentencing guidelines and other statutory factors.
Federal regulators closed Valley Bank in 2014.