On December 30, 2008, United States Attorney James R. Dedrick filed an Information in the United States District Court charging Whitehouse with three counts of violating the federal bank fraud statute,18 U.S.C. § 1344, by engaging in schemes to defraud Regions Bank, BankEast, and Clayton Bank and Trust, by fraudulently obtaining loans based on bogus collateral.

According to court documents, Whitehouse admitted that from May 2005 through June 18, 2008, that he, through his companies Procynet LLC d/b/a Direct Integration Specialists, also known as Direct IS, Medical Data Specicialists, Inc., Data Control, LLC, and Eagle Investment, LLC, defrauded the financial institutions named above by fraudulently obtaining loans based on non-existent collateral. Whitehouse further admitted that his schemes to defraud those financial institutions involved the following fraudulent conduct. Whitehouse would fraudulently represent to the financial institution that one of the above-named companies had made arrangements to purchase very costly and sophisticated medical data management software licenses, averaging more than $26,000 per license, which were needed to providing medical data management services to various medical practice groups for profit. Whitehouse fraudulently submitted bogus invoices to the above-named financial institutions for the purpose of fraudulently inducing those financial institution to believe that one of the above-named companies was in fact purchasing software licenses. Whitehouse admitted that the above-named companies in fact purchased no medical data management software licenses, contrary to the representations made to the financial institutions. Relying on Whitehouse's fraudulent representations and the bogus documentation he presented, and believing that they were receiving a security interest in valuable collateral, the above-named financial institutions loaned Whitehouse's companies millions of dollars. Whitehouse has admitted that: (1) his scheme to defraud Regions caused that financial institution a loss of $14,189,749; (2) his scheme to defraud BankEast caused that financial institution a loss of $950,567.21; (3) his scheme to defraud Clayton Bank and Trust caused that financial institution a loss of $1,794,709.

Judge Phillips has scheduled Whithouse's sentencing for May 20, 2009. Whitehouse could receive a sentence of up to thirty (30) years imprisonment and a $1,000,000 fine for each count of conviction. This investigation was conducted by the United States Secret Service. Assistant U.S. Attorney Trey Hamilton represented the government.

For further information, contact United States Attorney James R. Dedrick, Assistant U.S. Attorney Trey Hamilton, or Public Information Officer Sharry Dedman-Beard, at 865-545-4167.