OFFICE OF THE UNITED STATES ATTORNEY
WESTERN DISTRICT OF MISSOURI
JOHN F. WOOD
Contact Don Ledford, Public Affairs ● (816) 426-4220 ● 400 East Ninth Street, Room 5510 ● Kansas City, MO 64106
FEBRUARY 21, 2008
FOR IMMEDIATE RELEASE
FORMER LOAN OFFICER PLEADS GUILTY TO BANK FRAUD
FRAUD BY COLUMBIA MAN BELIEVED
TO HAVE EXCEEDED $740,000
JEFFERSON CITY, Mo. – John F. Wood, United States Attorney for the Western District of Missouri, announced that a former loan officer for two Columbia, Mo., banks pleaded guilty in federal court today to bank fraud related to a scheme that the government believes resulted in a loss of more than $740,000 for Boone National Savings and Loan Association in Columbia.
Brian Russell Nutter, 35, of Columbia, pleaded guilty before U.S. District Judge Nanette K. Laughrey this morning to the charge contained in a Nov. 6, 2006, federal indictment. Nutter is a former loan officer for Boone National Savings and Loan Association and, prior to that, Boone County National Bank.
Nutter admitted that he and co-defendant John T. Sobaski, 43, formerly of Columbia, created loans in the name of fictitious individuals and obtained loans utilizing forged signatures of guarantors. Sobaski, the former owner of Big Cedar Custom Design and Fabrication, was sentenced on Jan. 24, 2008, to two years and six months in federal prison without parole after pleading guilty to bank fraud. The court also ordered Sobaski to pay $326,318 in restitution.
Sobaski became a customer of Nutter’s while Nutter was employed as a loan officer at Boone County National Bank. In order to keep Sobaski’s loans at Boone County from going into default, Nutter created a fictitious individual named Lee Phillips, which Nutter used to create fraudulent loans.
Nutter left Boone County National Bank to work as a loan officer and vice president of Boone National Savings and Loan Association (BNSL) in June 2002. Nutter moved the Sobaski loans with him when he went to work at BNSL. While employed as a loan officer at BNSL, Nutter continued to make fraudulent loans with Sobaski. Among those fraudulent loans were three loans in the name of Lee Johnson, a fictitious individual doing business as Diamond Lift Company, a corporation with its address listed as Sobaski’s business address. The proceeds from these fraudulent loans were used to pay prior loans made to Sobaski and his business, Big Cedar, which had gone into default.
On Dec. 18, 2003, Nutter made a $350,000 loan to Big Cedar, which became delinquent in 2004. The purpose of this loan was to consolidate all the previous loans made to Sobaski and Big Cedar. Although the loan was approved based upon the guarantor signatures of Sobaski’s in-laws, their signatures were forged and they never signed as guarantors on the loan.
As a result of the fraud by Nutter and Sobaski, the loss to BNSL is approximately $313,000.
In addition to the fraudulent loans involving Sobaski, Nutter committed bank fraud against BNSL regarding Matthew Morgan, another bank client. Nutter admitted to forging client signatures on extension loans and altering financial statements by clients to ensure loan approval by his supervisors. Nutter admitted that he made a loan for Matthew Morgan, a friend, and that Nutter and Morgan sat down together and created a financial statement and altered Morgan's stock worth to ensure loan approval.
The government contends that the amount of that fraud is approximately $427,548.
Under federal statutes, Nutter could be subject to a sentence of up to 30 years in federal prison without parole, plus a fine up to $250,000 and an order of restitution. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Lawrence E. Miller. It was investigated by the Federal Bureau of Investigation, the Boone County, Mo., Sheriff’s Department and the Columbia, Mo., Police Department.
This news release, as well as additional information about the office of the United States Attorney for the Western District of Missouri, is available on-line at