Gary Ketchum, Bank Deception Scheme, New Jersey 2021

In a shocking turn of events, Gary Ketchum, a 73-year-old man from Hackettstown, New Jersey, pleaded guilty to his role in a scheme to deceive a bank and bank regulators. The scheme, which took place from 2009 to 2010, involved infusing $7 million of capital into First State Bank (FSB) through fraudulent means.

According to documents filed in the case, the scheme involved three phases. The first phase involved fraudulently infusing $7 million of capital into First State Bank. The second phase saw conspirators cause FSB to make millions of dollars in loans based on material misrepresentations to cover up the fraudulent nature of the capital infusion. The final phase involved lying to the FDIC and FSB about the fraudulent capital infusion and loans.

Ketchum, along with other conspirators, including Donna Conroy, Joseph Natale, and Albert Gasparro, were charged with conspiracy to deceive the FDIC and FSB, deceiving those two entities, conspiracy to commit bank fraud, and bank fraud. Conroy has already pleaded guilty and is awaiting sentencing, while Natale is scheduled to stand trial in November 2021.

The charges against Ketchum carry a maximum potential penalty of five years in prison and a fine of $250,000, or twice the gross pecuniary gain derived from the offense or twice the gross loss sustained by any victim. Ketchum is scheduled to be sentenced on June 28, 2021.

The investigation leading to Ketchum’s guilty plea was conducted by special agents of the FDIC – Office of Inspector General, the FBI, and inspectors of the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP). The government is represented by Ari B. Fontecchio of the Economic Crimes Unit of the U.S. Attorney’s Office, District of New Jersey.

Ketchum’s guilty plea is a significant blow to the conspiracy, and it is likely that the remaining defendants will face similar charges. The charges and allegations against the remaining defendants are merely accusations, and they are presumed innocent unless and until proven guilty.

In related news, it is worth noting that the charges against Ketchum and his co-conspirators are a reminder of the importance of honest business practices and the severe consequences that come with engaging in fraudulent activities.

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