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Fraud Friday – Another Wilmington Trust Banker Indicted

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July 18, 2014

By Bob Coleman
Editor, Coleman Report

sigtrapPeter Hayes joins fellow Wilmington Trust alums caught in the crosshairs of SIGTARP prosecutions.

SIGTARP’s (Special Inspector General for the Troubled Asset Relief Program) specialty is to jail community bankers who’s malfeasance contributed to loan losses to their institution, thus creating TARP investment losses.

The 48 year old former Relationship Manager is facing three counts of bank fraud, two counts of bank bribery, two counts of improper participation in bank loans and faces hundreds of years in prison and millions of dollars in fines.

Says SIGTARP, “Hayes stands charged with bank fraud, bribery, and fraudulently benefiting from loan transactions for a multitude of various offenses. This type of fraud and self-dealing is unacceptable, and SIGTARP and our law enforcement partners will pursue any offenders whose conduct jeopardizes taxpayers’ TARP investments to hold perpetrators accountable for their crimes.”

The Indictment alleges that Mr. Hayes engaged in several fraudulent transactions with one of his customers, identified in the Indictment as “Customer A.”

(1) Hayes accepted and solicited from Customer A investment opportunities in Customer A’s real estate developments, in which Hayes received monthly rental income sufficient to pay his mortgage plus expenses on investment properties purchased from Customer A;

(2) Hayes later solicited and accepted a favorable loan from Customer A to pay off Hayes’ investment losses;

(3) Hayes knowingly caused WTC loan funds to be disbursed to Customer A for purposes that were not authorized by WTC’s loan agreements with Customer A, and submitted false information in support of draw requests to provide funding to Customer A, including to cover overdrafts in Customer A’s operating bank account; and

(4) Hayes caused WTC to lend funds without loan committee approval to an investment company founded by Customer A’s president, so that the investment company could purchase model homes that would be leased back to Customer A or others.

Read the indictment here.

Read the Coleman Report coverage about former Wilmington Trust Market Manager Brian Bailey here:

 

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