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Banks (Finance)

Bank Fraudster Pleads Guilty to $14 Million Losses

Strategic Insights

— 1 min read

Edward Levinson, owner of various construction businesses, has pleaded guilty to bank fraud charges, resulting in over $14 million in losses to banks, subcontractors, and homebuyers. Levinson, who could have availed himself of bankruptcy protection, chose to make false statements to secure loans and cover his business's cash flow problems.

Key Takeaways:

  • Levinson's construction businesses, operating under several names, obtained loans from Royal Banks of Missouri, First Bank, and Enterprise Bank and Trust to develop and build homes in St. Louis County.
  • Levinson used loan money for purposes other than the intended projects, including other business interests and personal expenses.
  • Homebuyers and subcontractors suffered significant losses, totaling over $500,000 in liens and unpaid bills.
  • Levinson's scheme resulted in the foreclosure of several projects, including the Wynncrest and Terra Vista developments and the Belle Maison Project.
  • The indictment revealed that Levinson falsified an affidavit at First American Title, stating that all bills had been paid when, in fact, subcontractors and suppliers had not been paid.
  • Levinson, 50, of Chesterfield, MO, pleaded guilty to one felony count of bank fraud, with a maximum penalty of 30 years in prison and/or fines up to $1,000,000.
  • Restitution is mandatory, and sentencing has been set for April 2, 2010.

Statistics:

  • $14,000,000: Total losses to banks and homebuyers
  • $1,500,000: Losses to Royal Banks of Missouri
  • $1,000,000: Losses to Enterprise Bank and Trust
  • $300,000: Losses to homebuyers
  • $500,000: Liens against banks and homeowners associations
  • $18,000,000: Deal with First Bank for the Belle Maison Project
  • $8,000,000: Losses to First Bank on Belle Maison Project
  • $241,000: Losses to homebuyers on Belle Maison Project
  • $1,000,000: Subcontractor liens against First Bank on Belle Maison Project

Sources:

  • FBI St. Louis Division
  • United States Attorney's Office for the Eastern District of Missouri
  • Royal Banks of Missouri
  • First Bank
  • Enterprise Bank and Trust
  • First American Title

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