New charges in FBI proble of locals
One of the three men accused of stealing $53 million in a massive loan fraud scheme in Pennsylvania has been jailed while another faces new charges in the case.
Last November, John S. Tomberlin and Harold Young, both associated with Andalusia’s South Central Agency, and John Wiley Spann, a logging equipment dealer, were indicted by a federal grand jury under allegations they participated in the fraud at the request of officials with Sterling Financial Corp’s Equipment Finance LLC, based in Pennsylvania.
A 15-count indictment accused the three and five other defendants in Pennsylvania of mail fraud, money laundering and conspiracy in a six-year scheme where they falsified EFI’s books and looted its accounts, causing $53 million in losses by facilitating false loans.
The three locals also were ordered to forfeit $1,041,452.92.
Spann, Young and Tomberlin, along with other defendants, allegedly created false loan documents for logging equipment sales through EFI.
In August, Tomberlin pled guilty to four counts – committing conspiracy, mail fraud affecting a financial institution, conspiracy to commit money laundering and money laundering – for his part in the case. He now faces a total of up to 85 years in jail and $4.8 million in fines.
Prior to entering the plea, Tomberlin had been free on $50,000 bail, but that was switched to home confinement after his plea was given. He was given home confinement until sentencing; however, last week – on Dec. 16 – his bail was revoked and he was taken into federal custody, said Patty Hartman of the U.S. Attorney’s Office, Eastern District of Pennsylvania, on Wednesday. Hartman could not comment on Tomberlin’s locations, citing security reasons.
No sentencing date was released; however, Hartman said an indictment filed Dec. 13 outlines the new charges against Young, as well as with a husband and wife couple from Pennsylvania.
Young now also faces one count of wire fraud – a new offense – and one count of conspiracy to commit money laundering, five counts of money laundering and eight counts of mail fraud.
In the new indictment, it states that from 2002 until sometime in January 2007, Young is alleged to have made 22 bank deposits totaling $1.04 million paid for premiums for non-existing insurance policies on non-exist equipment. The indictment also alleges that on Jan. 2, 2007, Young deposited a $66,150 check for premiums of 10 fictitious insurance policies into the South Central Agency account, and then – on the same day – sending nearly $43,000 to a company owned by Spann.
EFI, owned by Sterling Financial Corp’s Bank, loaned money to logging and land-clearing firms. The indictments allege the accused padded EFI’s books with bogus loans.
Spann pled guilty in July and agreed to forfeit $7.6 million he pocketed from the fraud. While his sentencing was set for Dec. 15, Hartman could find no record of the proceedings. Spann could face up to 45 years in prison and a $2.5 million fine.
Young is set for trial on April 5 in Philadelphia. He is among 10 other defendants indicted in November 2010 in the case. The others, like Tomberlin and Spann, have pleaded guilty and are expected to testify at the trial.