News and Press Releases

Former Cumberland Man Pleads Guilty
to Bank Fraud and Tax Evasion Charges

FOR IMMEDIATE RELEASE
February 4, 2014

Contact: Halsey B. Frank
Assistant United States Attorney
Tel: (207) 780-3257

Portland, Maine: United States Attorney Thomas E. Delahanty II announced that Walter
Scott Fox, 56, formerly of Cumberland, Maine, and now of Canton, Georgia, pleaded guilty in
U.S. District Court to bank fraud and tax evasion charges.

According to court documents, from 1995 until 2011, Fox used his position as a loan
officer at Casco Northern Bank and at its successor, KeyBank, to originate or authorize over
$14,000,000 in fraudulent loans and lines of credit using the identities of four real individuals,
without their knowledge or consent. He used over $5,800,000 of the fraudulent proceeds to keep
the loans current and prevent the detection of his scheme. He used almost $8,200,000 for
personal expenses including to pay for his children’s educations and family vacations, and to
support his business, “The Boathouse.” Fox failed to report receiving any of this income to the
Internal Revenue Service (“IRS”) causing a tax loss of over $1,300,000 between 2006 and 2011.

The scheme was discovered in 2012 when KeyBank denied an increase for one of the
credit lines because it did not fit the model for its community development loans. With no funds
available to make payments and keep the scheme afloat, all the fraudulent loans became
delinquent by August, 2012. Fox abruptly resigned his position at KeyBank on September 7,
2012 when a supervisor became concerned about the delinquent loans and made inquiries about
the status of his loan portfolio.

Fox faces a sentence of up to 30 years of imprisonment and a fine of up to twice the gain
or loss on the bank fraud charge and up to five years and a fine of up to twice the loss on the tax
evasion charge. He will be sentenced after the completion of a presentence investigation report
by the United States Probation Office.

The case was investigated by the Federal Bureau of Investigation and IRS - Criminal
Investigations.

 

 

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