An Ozarks businessman has been indicted by a federal grand jury for bank fraud and wire fraud schemes totaling more than $3.3 million. He also is charged with money laundering and bankruptcy fraud.
Richard Thomas Gregg, 57, of Springfield, was charged in a 17-count indictment returned under seal Feb. 28 and opened to the public today after his arrest and initial court appearance. The indictment comprises four counts of bank fraud, 10 counts of money laundering, two counts of wire fraud and one count of bankruptcy fraud, according to a news release from the office of Tammy Dickinson, U.S. attorney for the Western District of Missouri.
“Several local financial institutions suffered significant losses from a series of bank fraud schemes,” Dickinson said in the release. “These are not victimless crimes, and we will aggressively prosecute those who seek to profit from financial crimes.”
Gregg had served as the principal shareholder and director of Springfield-based Southwest Community Bank before it failed in May 2010. He and his wife also were majority shareholders of Glasgow Savings Bank before it was shut down by the Federal Deposit Insurance Corp. in 2012. Gregg also was a real estate developer, investor, and insurance agent for the Shelter Mutual Insurance Co.
Fremont Avenue propertyThe indictment alleges that in 2008, Greg engaged in a scheme to defraud Southwest Community Bank by selling a piece of commercial real estate, 2814 S. Fremont Ave., at a price he knew to be inflated - $1.6 million, the release said.
The charges claim Gregg did not disclose to Southwest Community Bank he had purchased the property for $775,000 a few months beforehand. He allegedly did not disclose to the bank he had performed two appraisals: one where the property was valued at $762,000 and another he canceled because he didn't agree with. According to the indictment, Gregg directed his son, who worked at the bank, to order an appraisal of the property by another appraiser, who valued it at $1.6 million.
According to the release, the alleged activities related to the Fremont property resulted in four counts of money laundering.
Southwest Community Bank was closed by federal regulators in May 2010 due to troubled assets, according to
Springfield Business Journal archives.
Stock schemeGregg borrowed $2 million in February 2009 from Great Southern Bank, using 160,000 shares of First Bancshares Inc., which serves as the holding company for First Home Savings Bank. The stock certificate was physically deposited with Great Southern by Gregg, the release said.
The indictment alleges that in May 2009, with $1.5 million remaining on the loan, Gregg withdrew the stock certificate, signing a receipt promising to return it within 30 days. Instead, he allegedly deposited the collaterialized shares into his account at Scottrade in St. Louis, borrowed $440,000 from Scottrade and did not return the stock certificate or proceeds to Great Southern.
Car loansThe indictment charges Gregg with two counts of bank fraud, claiming he used collectible automobiles as collateral to obtain loans and then sold the cars without paying back the loans, the release said.
In separate but related schemes in January and February 2010, Gregg allegedly defrauded Great Southern, Metropolitan National Bank and Peoples Bank of the Ozarks. The indictment claims he sold seven vehicles at the Barrett-Jackson Auto Auction in Scottsdale, Ariz., five of which were encumbered at the three banks.
The indictment claims that in October 2007, Gregg borrowed $400,000 from Great Southern, using four vehicles as collateral, including a 2006 Ford GT. The vehicle sold at the Arizona auction in January 2010 for roughly $150,000, causing Great Southern to realize a loss of $129,644, according to the release.
At Metropolitan National Bank in 2005, Gregg borrowed $400,000, securing the loan with "floor-plan" financing, meaning he opened a revolving line of credit against specific pieces of collateral, which were vehicles. The loan was to be repaid in increments when each of the vehicles sold. The collateral included a 1971 Chevy pickup, collateralized for $17,221. The indictment alleges Gregg sold the vehicle at auction for $29,000, resulting in the default of the loan and a $17,221 loss to Metropolitan.
Casino checksThe indictment contains two counts of wire fraud after checks bounced at two Oklahoma casinos.
In January 2012, Gregg allegedly made out five checks totaling $50,000 to Buffalo Run Casino in Miami, Okla., knowing his credit union account contained insufficient funds to cover the checks, according to the release.
The indictment also claims that between Feb. 16 and March 1, 2012, he made out five checks totaling $60,000 to Downstream Casino and Resort in Quapaw, Okla., knowing his bank account had insufficient funds.
Bankruptcy fraudIn August 2012, Gregg allegedly made false declarations in bankruptcy proceedings.
In the proceeding, Gregg stated bankruptcy debtor 1717 Marketplace LLC owed him $868,000 and another person $801,000, though Gregg allegedly knew neither he nor the unnamed person had lent 1717 Marketplace LLC funding in those amounts, according to the release.
The case is being prosecuted by Assistant U.S. Attorney Steven Mohlhenrich and was investigated by the FDIC Office of Inspector General and Internal Revenue Service-Criminal Investigation.
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