Nov. 8, 2010
FORMER BANK PRESIDENT, VICE PRESIDENT AND TWO REAL ESTATE DEVELOPERS INDICTED IN BANK FRAUD CONSPIRACY
Conspiracy allegedly caused approximately $500,000 in loss to Texas National Bank
(McALLEN, Texas) - A 16-count sealed indictment charging Arsenio Alfaro and Elizabeth Aguirre, both of Donna, Texas; Homer Guzman, of Edinburg, Texas; and John Guzman, of McAllen, Texas, with conspiracy to commit bank fraud and bank fraud has been unsealed, United States Attorney José Angel Moreno announced today.
FBI agents arrested Homer Guzman, 43, on Friday, Nov. 5, 2010, at his residence. On Friday, U.S. Magistrate Judge Dorina Ramos ordered Guzman to remain in federal custody pending a hearing scheduled for Nov. 10, 2010, at 11:00 a.m., on the request of the United States that Guzman remain in custody without bond pending trial.
Alfaro, 45, Aguirre, 41, and John Guzman, 33, surrendered to federal agents this morning and each appeared before Judge Ramos and were released on bond pending trial. According to the indictment, Alfaro was the formerly president of Texas National Bank (TNB), a multi-branch regional bank based in Mercedes, Texas, while Aguirre was vice president and loan officer. The indictment alleges that, from April 2006 through June 2007, Alfaro and Aguirre obtained cash kickbacks and other compensation from Homer Guzman, owner of Valle Escondido LLC construction company, and his employee, John Guzman, in exchange for allowing the Guzmans to overdraft their TNB business and personal bank accounts by approximately $348,000 and to conceal the overdrafts by engaging in a check-kiting scheme.
In particular, Alfaro and Aguirre allegedly permitted the Guzmans to deposit checks from a closed Valle Escondido account into the overdrafted accounts at the end of each month in an amount that, when immediately credited by Alfaro and Aguirre, would make the overdrafted accounts temporarily positive. The Guzmans allegedly made the illicit deposits to keep their accounts off of a TNB overdraft report which was generated at the end of every month and circulated to TNB’s Board of Directors. At the beginning of the following month, however, the checks would be returned for insufficient funds and the accounts would return to their overdrafted status. This process was allegedly repeated by the defendants throughout the indictment period.
In a related scheme, Homer Guzman is accused of making fraudulent representations to TNB to obtain approximately $150,000 in cash draws on two TNB construction loans covering Valle Escondido’s construction of speculative homes in the Canyon Creek subdivision of Brownsville, Texas. Specifically, the indictment alleges he submitted numerous draw requests to TNB representing that work concerning virtually every stage of home construction - ranging from the pouring of the foundation to the installation of kitchen cabinets - had been performed on the Canyon Creek properties when in fact he, along with Alfaro and Aguirre, knew it had not been performed.
If convicted, each defendant faces up to 30 years in federal prison without parole, a $1,000,000 criminal fine and mandatory restitution.
The investigation was conducted by the FBI. Assistant United States Attorney Gregory S. Saikin is prosecuting the case.
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