Former Tennessee COO Community Banker Charged with Fraud 5 Years after Bank Failure

Former Tennessee COO Community Banker Charged with Fraud 5 Years after Bank Failure

February 17, 2017

By Bob Coleman
Editor, Fraud Friday

73-year old Lamar Cox has been indicted for delaying the reporting of a $710,000 loss by Tennessee Community Bank. The loss was incurred on the sale of eight foreclosed properties for $4 million.

The Feds say Cox knew the bank’s 2009 financials would be “just ugly.”

So, Cox spread the loss over two quarters in order that the bank’s books would look better to the regulators.

Cox is accused of directing staff members of creating “a posting error” that deferred $440,000 of the loss into the next quarter.

“Cox’s actions caused TCB to understate its net loss by $440,000 reported in the Call Report filed with the FDIC for the third quarter of 2009, thus concealing the true financial condition of TCB from shareholders, examiners and the public,” says SIGTARP.

TCB was closed by federal regulators in January 2012, at a cost of $447 million to the FDIC insurance fund.