United States Attorney's Office District of Connecticut
Press Release

HARTFORD ATTORNEY PLEADS GUILTY TO FEDERAL CONSPIRACY AND BANK FRAUD CHARGES

Nora R. Dannehy, Acting United States Attorney for the District of Connecticut, announced that PAUL J. APARO, 58, of Goodwin Circle, Hartford, waived his right to indictment and pleaded guilty today before United States District Judge Alvin W. Thompson to one count of conspiracy to commit financial institution bribery and one count of bank fraud.

In pleading guilty, APARO, an attorney, admitted that from approximately October 2001 to February 2007, he conspired with Kevin J. O’Keefe, who was a Vice President at Fleet Bank (and Bank of America after it acquired Fleet Bank) in Hartford, and “Individual B,” who was a real estate developer in Connecticut, to enrich themselves through the use of O’Keefe’s position at the bank.  According to documents filed with the Court and statements made in court, APARO, O’Keefe and Individual B corrupted the bidding process on distressed loans that Fleet Bank was selling.  As part of the scheme, APARO, O’Keefe and Individual B created shell companies through which to submit bids on distressed loans being sold by Fleet Bank and with which to receive and distribute proceeds from the scheme.  O’Keefe had access to and obtained confidential information belonging to Fleet Bank and provided that information to APARO and Individual B so that it could be used to submit winning bids on distressed loans.  O’Keefe also intentionally provided outdated information to other bidders involved in the bidding process in order to cause those bidders to submit artificially low bids.  O’Keefe provided APARO and Individual B with access to the most up-to-date information.  O’Keefe also excluded bidders who he, APARO and Individual B believed would submit competitive bids for a distressed loan on which O’Keefe, APARO and Individual B sought to bid.

APARO has acknowledged that Individual B paid him and O’Keefe approximately $100,000 on one loan that Individual B obtained through the corrupt assistance of APARO and O’Keefe.  In addition, Individual B agreed to pay a shell company, referred to here as “LA,” 15 percent of the profits on another distressed loan on which Individual B, with APARO and O’Keefe’s corrupt assistance, had submitted a winning bid.  The 15 percent of the profits on the loan that Individual B (through his own shell company) paid to LA amounted to more than $1.4 million, which APARO and O’Keefe essentially split evenly.

In pleading guilty, APARO also admitted that, in December 2005 and January 2006, he and O’Keefe engaged in a separate scheme to defraud Bank of America and APARO’s client out of money.  In that scheme, a client contacted APARO about getting a mortgage release from Bank of America for an old mortgage.  APARO contacted O’Keefe about it, and O’Keefe checked Bank of America’s internal records for the mortgage.  O’Keefe found that no record of the mortgage existed within the bank.  However, APARO and O’Keefe conspired to defraud the client and the bank by telling the client that the bank would release the mortgage for $55,000, which the client paid to APARO through his law firm’s trust account.  APARO then paid the $55,000 to O’Keefe.  The defendant signed a release on behalf of Bank of America for the mortgage, which was provided to the client.

Judge Thompson has scheduled sentencing for October 14, 2008, at which time APARO faces a maximum term of imprisonment of 35 years and a maximum fine of more than $1,000,000.

On June 11, 2008, O’Keefe also pleaded guilty to one count of conspiracy to commit financial institution bribery and one count of bank fraud.  He awaits sentencing.

This case is being investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Eric J. Glover.

CONTACT:

U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
thomas.carson@usdoj.gov