Former bank chairman charged with loan fraud
A federal grand jury has charged a former chairman of Mariner’s Bank in Edgewater, N.J., for alleged loan fraud.
Fred Daibes and Michael McManus, the chief financial officer of Daibes Enterprises, were charged Tuesday for an alleged scheme a to fraudulently obtain loans from the $390 million-asset Mariner’s, U.S. Attorney Craig Carpenito said in a press release.
Daibes and McManus will have their initial appearances and arraignments at a later date. They were each charged with one count of conspiracy to misapply bank funds and make false entries to deceive a financial institution and the Federal Deposit Insurance Corp.
Daibes, 61, was also charged with five counts of misapplying bank funds, six counts of making false entries to deceive a financial institution and the FDIC, and one count of causing reliance on a false document to influence the FDIC.
McManus, 61, of Madison, N.J., was charged with four counts of misapplying bank funds, one count of making false entries to deceive a financial institution and the FDIC, one count of causing reliance on a false document to the influence the FDIC and two counts of loan application fraud.
Daibes and McManus allegedly orchestrated a loan scheme from 2008 to 2013 to circumvent legal lending limits by ensuring that millions of dollars in loans flowed to Daibes. Daibes allegedly concealed his beneficial interests in those loans from Mariner’s Bank and the FDIC.
The charges claim that, to convince Mariner’s Bank to approve two of the loans, McManus signed and provided to Mariner’s Bank a false document showing the profitability of gas stations pledged as collateral after buying the stations from Daibes in sham transactions.
After the FDIC began an investigation into one of the loans, Daibes, McManus and others submitted to the FDIC a backdated sales contract, the charges claim. The contract made it falsely appear as though a third party had received one of the loans from Mariner’s Bank to pay Daibes for his interest in a real estate venture.
The defendants face up to 30 years in prison and a maximum fine of $1 million.
"The government’s action ... is completely unjustified, both legally and factually," Lawrence Lustberg, Daibes' lawyer, said in a statement.
"The U.S. Attorney is well aware, after a 6-year investigation, that there is no victim, no deception, and no fraud," Lustberg added. Daibes "invested millions of dollars into the bank during the course of this investigation — far more than the amount of the nominee loans. The notion underlying the indictment is that he conspired to defraud himself, which is obviously ridiculous. Moreover, every penny of every loan has been paid back."