Fraud Friday – Former Bank VP Pleads Guilty to $600,000 Loan Fraud and Arson
May 19, 2023
Delaney Sexton
Contributing Editor
Fraud Friday – Former Bank VP Pleads Guilty to $600,000 Loan Fraud and Arson
“Richard Pigg not only used his professional position to deceive his victims and defraud the bank that employed him, he also risked the lives and safety of our heroic first responders when he chose to burn houses and apartment buildings to collect even more money he wasn’t entitled to,” says U.S. Attorney Rachelle Aud Crowe.
At Community First Bank of the Heartland in Mount Vernon, Richard Pigg worked as a bank vice president and loan officer. During his time at the bank, he found bank customers and convinced them to purchase rental properties on his behalf. He told his victims that he would find the tenants, collect rent, and maintain the rental properties. In return, the victims would receive an income from the properties that were under their names.
While he facilitated the mortgage loans for his victims, he hid his financial interest in the loans. Further, Pigg increased the amount being financed by the mortgage loan to exceed the purchase price by thousands of dollars without his victims’ consent. The surplus of loan proceeds was then put into Pigg’s accounts and used to pay his debts.
The scheme did not end with loan fraud. Pigg admitted to burning one of the rental properties. Upon his first attempt at arson, the property was only partially damaged, but after his second try, the entire property was deemed a “total loss.” Once he was given the insurance benefits, he paid off the mortgage loan on the property. Another rental property suffered the same fate. He renewed an insurance policy and took out a second insurance policy on the property shortly before he burned it down.
Richard Pigg pled guilty to six counts of bank fraud and three counts of arson, and he defrauded the bank of more than $600,000.
“In this proven pattern of conniving and hazardous actions, I appreciate the work by our federal law enforcement partners to put an end to the defendant’s dangerous financial ploys,” continues Crowe.