Kenneth Charity, Conspiracy to Defraud First NBC Bank, Louisiana 2019

The New Orleans business community is reeling after Kenneth Charity, a 54-year-old resident of the city, pleaded guilty to conspiring to defraud First NBC Bank. The bank, which failed in April 2017, was a major player in the local financial scene.

According to the Bill of Information, Charity had a banking relationship with First NBC Bank, both individually and through certain entities, from February 2007 to April 2017. During that time, Bank President A acted as the loan officer for Charity and the loan officer to certain of Charity's entities. By the time the bank failed, the balances on the loans issued to Charity and the entities totaled over $18 million.

Charity, Bank President A, and others knowingly conspired to defraud First NBC Bank. The purpose of the conspiracy was to unjustly enrich themselves, disguise the true financial status of Charity and the entities, conceal the accurate performance, and misrepresent the purpose of the loans made to Charity and the entities.

Charity and his co-conspirators provided First NBC Bank with materially false and fraudulent documents and financial statements, which overstated the value of Charity's assets, understated his liabilities, and omitted material information. These false statements disguised Charity's and the entities' true financial condition.

The Bill of Information also alleges that it was part of the conspiracy for Bank President A and others to disguise Charity's and the entities' true financial condition by issuing new loans to Charity and the entities, which would pay older loans that Charity was unable to repay. The new loans would then appear to be current and performing, while the old loans appeared to have been paid.

Charity could face up to 30 years' imprisonment, a fine of not more than $1 million, or twice the gross gain to him or the gross loss of any victims, 5 years of supervised release, and a special assessment of $100. Judge Lance M. Africk set Charity's sentencing hearing for October 23, 2019, at 2 pm.

Source: https://www.justice.gov/usao-edla/pr/new-orleans-business-owner-pleads-guilty-conspiracy-defraud-first-nbc-bank