A second official of a small rural Mississippi bank rocked by scandal is facing charges.

Henry L. McNair 3d, who had been a president and director of the former Bank of Edwards, was charged at the end of last month with conspiring to embezzle more than $941,000 over four years. He has not yet responded to the charge and could not be reached for comment.

"Everyone was very surprised by the news," said Jean White, the town clerk of Edwards, a community of 1,279 people 20 miles west of Jackson. "This is a family-oriented small town where everybody knows everybody. We all just don't believe it, and won't until he is proven guilty."

Another official of the $16 million-asset institution, which was acquired in the spring by Merchants National Bank of Vicksburg, stole $79,000 from the bank last year and fled to Europe. The official, a vice president, was convicted last fall and served six months in prison.

Mr. McNair, whose wife is from Edwards and has lived in the area for more than 20 years, approved at least 47 loans ranging from $6,556 to $63,661 to fictitious borrowers, according to the charge filed by the Justice Department.

The department also charges that Mr. McNair altered the bank's reports and books to show that interest and principal payments on the fraudulent loans were up to date, which was not the case. He also granted extensions and issued new loans so that minimal payments could be made to appease regulators, the department said.

The loan amounts averaged about $20,000, which was within Mr. McNair's lending authority and did not require approval from other bank officials, according to court documents.

The Justice Department did not accuse Mr. McNair of receiving any of the money, it only charged that he facilitated the funneling of funds to two co-conspirators, who were not named.

Mr. McNair left the bank March 31, the day it was formally acquired by Merchants National. Company officials would not comment on the case.

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