Warren County Man, Gary Ketchum Admits Role in Scheme to Deceive Bank and Bank Regulators
NEWARK, N.J (STL.News) A Warren County, New Jersey, man today admitted his role in a scheme to defraud a bank and bank regulators, Acting U.S. Attorney Rachael A. Honig announced.
Gary Ketchum, 73, of Hackettstown, New Jersey, pleaded guilty by videoconference before U.S. District Judge Kevin McNulty to a superseding information charging him with one count of conspiring to make false entries to deceive First State Bank and to deceive the Federal Deposit Insurance Corporation, FSB’s regulators.
According to documents filed in this case and statements made in court:
A three-phase scheme took place from 2009 to 2010. The first phase was to fraudulently infuse $7 million of capital into First State Bank (FSB). In the second phase of the scheme, conspirators caused FSB to make millions of dollars in loans based on material misrepresentations to cover up the fraudulent nature of the capital infusion and to end inquiries from FSB’s auditors. The final phase involved lying to the FDIC and FSB, among others, about the fraudulent capital infusion and loans.
In May 2017, a conspirator, Donna Conroy, pleaded guilty to her role and is awaiting sentencing.