Raymond Grow III, Bank Fraud, Louisiana 2013

COVINGTON, LA – A Northshore construction executive has been sentenced to prison for defrauding a bank with a falsified wetlands determination letter, a scheme that allowed him to secure a multi-million dollar loan for a Louisiana subdivision. Raymond Grow III, 40, of Covington, pleaded guilty in April 2013 and received an 18-month federal prison sentence in August of the same year, according to court documents.

Grow, the owner of Masters Built Construction, LLC, obtained a $3,450,000 loan from First American Bank and Trust in May 2006, intended to develop a 22-acre plot of land along Hwy 22 in Ponchatula, Louisiana, known as The Landings subdivision. The loan was personally guaranteed by Grow. A crucial condition of the loan approval was a Wetland Determination letter from the U.S. Army Corps of Engineers, verifying the extent of wetlands on the property.

However, Grow knowingly submitted a fabricated letter to the bank’s closing attorney, falsely representing that only a small percentage of the land contained wetlands. Investigations revealed that Grow didn’t request an official determination from the Corps; instead, he constructed the document by cutting and pasting information from a separate, legitimate wetland determination report related to a different property. This deception directly influenced the bank’s decision to finalize the loan.

The fraud was uncovered years later during due diligence conducted by a prospective buyer of the property. The buyer presented the submitted Wetland Determination letter to the Corps of Engineers, who quickly determined the permit numbers listed on the letter did not correspond to any assessment of the Landings subdivision. The Corps confirmed they had never conducted a wetlands determination for the 22-acre plot.

Federal prosecutors charged Grow on December 26, 2012, with violating Title 18 U.S. Criminal Code, specifically 18 U.S.C. 1014, which prohibits knowingly making false statements to a bank in connection with a loan. The offense carries a maximum potential penalty of 30 years imprisonment, a $1,000,000 fine, and up to five years of supervised release. In addition to his prison sentence, Grow was ordered to repay the full loan amount to First American Bank and Trust.

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Key Facts

Defendant: Raymond Grow III
Company: Masters Built Construction, LLC
Location: Ponchatula, Louisiana
Loan Amount: $3,450,000
Crime: Fraudulent submission of a falsified Wetland Determination letter
Statute Violated: 18 U.S.C. 1014 (False Statements to a Bank)
Penalty: 18 months imprisonment, full loan repayment

This case underscores the importance of accurate environmental documentation in real estate development and the severe consequences of fraudulent misrepresentation in financial transactions. The EPA’s Criminal Investigation Division played a key role in uncovering the deception, highlighting the agency’s commitment to prosecuting environmental crimes and financial fraud.

Source: EPA ECHO Enforcement Case Database

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