S&T in Pennsylvania discloses potential exposure to check kiting scheme
S&T Bancorp in Indiana, Pa., said it is dealing with exposure to a check kiting scheme.
The $9 billion-asset company disclosed in a regulatory filing Monday that the scheme, allegedly conducted by an unnamed business customer, resulted in $59 million in lost deposits. S&T said the financial impact hinges on its ability to recover the funds.
The company has hired outside counsel to conduct an internal review and the scheme was reported to law enforcement and regulatory authorities.
The company also said it could incur a credit loss tied to a loan agreement and credit line with the customer.
S&T said its total credit loss exposure is $15.1 million, including a $14.3 million loan secured by commercial real estate and a $750,000 line of credit secured by a lien on business assets.
S&T said it plans to pursue all available means to mitigate any potential loss.