BB&T exec, real estate developer conspired to scam bank

by Ryan Smith20 Feb 2018

A former BB&T executive has been convicted of conspiring with a real estate developer to scam the bank out of hundreds of thousands of dollars.

Brent M. Lee, 41, was convicted last week of conspiracy to commit bank fraud, two counts of aiding and abetting bank fraud, two counts of misapplication of bank moneys by a bank employee, and four counts of making unauthorized obligations by a bank employee, according to the US Attorney’s Office for the Eastern District of Kentucky.

Prosecutors said that Lee, a former market president for BB&T, conspired with Kentucky real estate developer Paul D. Fannin and Fannin’s daughter, Chelsea Stone, to defraud the bank. Fannin had an outstanding loan with BB&T for $950,000 for developing a townhome project. When BB&T officials became concerned about the progress on the project, the bank downgraded the loan and instituted certain protocols that Lee and Fannin were supposed to follow in order to keep a closer watch on the project before disbursing more money to Fannin.

Rather than follow those protocols, Lee suggested to Fannin that they use Stone to bet a new loan from the bank, sending the proceeds directly to Fannin. In October of 2014, Lee had Stone sign numerous documents to get a commercial loan for $100,000. Lee told BB&T that the loan was intended to expand Stone’s embroidery business – a business that didn’t exist. The BB&T check for the loan was deposited into Fannin’s account.

In November of 2014, Lee got Stone to sign more documents in order to get a new loan to pay off her outstanding $100,000 obligation, the US Attorney’s Office reported. Then in January of 2015, he had documents prepared for Stone’s signature to get still another loan that would pay off her November loan and pay out an additional $149,212.50.

Almost all of the money from the loans actually went to Fannin, according to the US attorney. Lee then had the loan extended again in July, just two months before he resigned from BB&T.

Of the $250,000 gained through the fraud, Fannin spent at least $120,000 in casinos, according to the US attorney.

Fannin pleaded guilty to conspiracy to commit bank fraud prior to trial. Lee is scheduled for sentencing in May. He faces up to 30 years in prison.  

 

Related stories:
Top mortgage execs admit to $8.9 million scam
Loan officer charged with using own bank statement in mortgage fraud scheme

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