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Omaha Steve

(99,079 posts)
Sat Oct 24, 2015, 12:30 PM Oct 2015

TierOne Bank ex-CEO was 'driving force' behind fraud, former president says


http://www.omaha.com/money/tierone-ex-ceo-was-driving-force-behind-fraud-former-president/article_cd71d710-9420-5ec6-b61b-59d073839e84.html

POSTED: SATURDAY, OCTOBER 24, 2015 12:30 AM | UPDATED: 12:46 AM, SAT OCT 24, 2015.
By Russell Hubbard / World-Herald staff writer

The former president of TierOne Bank fingered ex-Chief Executive Gil Lundstrom on Friday as participating in the deception and aggressive lending that toppled Nebraska’s second-largest bank in 2010.

“He was the driving force,” said former TierOne President James Laphen, testifying at the federal criminal trial of Lundstrom. “... He was aware and part of the process.”

The testimony of Laphen — who has pleaded guilty in the case — came on day three of Lundstrom’s trial in U.S. District Court in Lincoln. Lundstrom, 74, faces dozens of years in prison if convicted on all 13 counts related to allegations of fraud by deceiving banking regulators and investors as TierOne cratered under a cascade of speculative real estate loans mostly made in other states. The insolvent bank was seized by regulators and sold in 2010.

U.S. prosecutors from the Washington, D.C., office of the Justice Department’s fraud division submitted documents and elicited testimony Friday that attempted to suggest to jurors that Lundstrom knew his fellow TierOne executives were worried about the bank’s financial health and flouting of banking regulations.

FULL story at link.
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