Kerri Agee, Wire Fraud Affecting a Financial Institution, Indiana 2004

INDIANA SHAME Five former high-ranking officers and employees of Banc-Serv Partners LLP, a lending service provider, have been convicted of their roles in a 13-year scheme to defraud the Small Business Administration (SBA) of $5 million.

The defendants, Kerri Agee, 46, of Noblesville, Indiana, former president, chief executive officer and founder of Banc-Serv; Kelly Isley, 40, of Westfield, Indiana, Banc-Serv’s former chief operating officer; Nicole Smith, 44, of Indianapolis, Indiana, a former Banc-Serv employee; Chad Griffin, 48, of Carmel, Indiana, Banc-Serv’s former chief marketing officer; and Matthew Smith, 52, of Westfield, Indiana, Banc-Serv’s co-founder and a former director of a lending institution that originated loans with Banc-Serv, fraudulently obtained SBA-guaranteed loans on behalf of their clients, knowing that the loans did not meet SBA’s guidelines and requirements for the guarantees.

The evidence presented at trial showed that from approximately 2004 until October 2017, the defendants helped originate SBA loans on behalf of various financial institutions and other lenders and, on multiple occasions, fraudulently obtained guarantees for loans that the SBA had deemed ineligible. They did so by, among other things, knowingly misrepresenting what the loans would be used for and unlawfully diverting previously denied loan applications into expedited approval channels at the SBA.

When the fraudulently guaranteed loans defaulted, the defendants caused the submission of the reimbursement requests to the SBA to purchase the defaulted loans from investors and lending institutions, thereby shifting some of the losses on the ineligible loans to the SBA.

The fraudulent loans presented at trial totaled approximately $5 million in guaranteed disbursements, which were not eligible for SBA guarantees.

Kerri Agee was convicted of one count of conspiracy to commit wire fraud affecting a financial institution and four counts of wire fraud affecting a financial institution. Kelly Isley was convicted of one count of conspiracy to commit wire fraud affecting a financial institution and two counts of wire fraud affecting a financial institution. Nicole Smith was convicted of one count of conspiracy to commit wire fraud affecting a financial institution and two counts of wire fraud affecting a financial institution. Chad Griffin was convicted of one count of conspiracy to commit wire fraud affecting a financial institution. Matthew Smith was convicted of one count of conspiracy to commit wire fraud.

The defendants face a maximum sentence of 30 years in prison per count of conspiracy or fraud affecting a financial institution. The charge of conspiracy to commit wire fraud carries a maximum sentence of 20 years. A federal district court judge will determine any sentence for each of these defendants after considering the U.S. Sentencing Guidelines and other statutory factors.

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