(NIT photo)
CEDAR RAPIDS — An Iowa man has admitted helping move nearly $22 million in fraudulently obtained loan money through bank and brokerage accounts in a sprawling federal money laundering case.
Curtis Weston, 35, pleaded guilty October 2 to one count of money laundering.
Weston, who is from Rockwell City, admitted in a plea agreement that he and another individual transferred at least $21,992,037 in fraudulently obtained loan funds.
The case adds to a string of major financial crimes prosecuted in Iowa federal court. NorthIowaToday.com recently reported on a massive stolen Treasury check scheme targeting Iowa banks, where a Chicago felon was sentenced to more than 13 years in federal prison.
Loans allegedly created in names of 26 unwitting customers
Federal prosecutors say the scheme involved loans issued in Weston’s name and in the names of 26 other bank customers who did not know their identities were being used.
According to Weston’s plea agreement, an individual employed at the bank processed the fraudulent loans and moved the proceeds from the bank’s general ledger into Weston’s bank account.
Weston and another individual also maintained accounts, separately and together, at an online brokerage based in New York.
Federal prosecutors say they intend to show at sentencing that the entire $21,992,037 in fraudulently obtained loan proceeds was transferred from Weston’s bank account into brokerage accounts held in his name.
Weston admits laundering $20,000
As part of the guilty plea, Weston specifically admitted taking $20,000 of the fraudulently obtained loan money and illegally transferring it to an account at another bank.
That admitted transaction forms the basis of the money laundering count to which Weston pleaded guilty.
The broader allegations, however, describe a much larger flow of money involving nearly $22 million in fraudulent loans and dozens of unsuspecting bank customers.
Bank fraud cases continue to hit Iowa federal courts
Financial institution fraud has produced several sizable federal cases in Iowa.
Earlier this year, NIT reported on a Northern Iowa farmer who lied to a bank about millions of dollars in nonexistent corn and ultimately caused more than $873,000 in losses.
In that case, federal investigators said the defendant submitted false information to obtain a $1 million operating line of credit.
NIT also reported on a Northern Iowa financial scheme involving more than $250,000 and false bankruptcy filings.
Weston’s case is substantially larger in dollar value, with federal prosecutors placing the amount of fraudulently obtained loan funds at more than $21.9 million.
Up to 10 years in federal prison
Weston will be sentenced by U.S. District Court Judge Leonard T. Strand after a presentence investigation report is completed.
He remains free on bond while awaiting sentencing.
Weston faces a maximum sentence of 10 years in federal prison, a fine of up to $250,000 and as much as three years of supervised release following any prison term.
There is no parole in the federal prison system.
Federal banking watchdog and Iowa sheriff investigated
The investigation was conducted by the Federal Deposit Insurance Corporation Office of Inspector General and the Sac County Sheriff’s Office.
Assistant U.S. Attorneys Ron Timmons and Dan Chatham are prosecuting the case.
The guilty plea now moves one of Iowa’s larger recent alleged financial fraud schemes toward sentencing, where prosecutors say they plan to lay out the full trail of nearly $22 million in fraudulent loan proceeds.