CHICAGO (Sun-Times Media Wire) -
You would never know it from his financial disclosure statements, but the former chairman of a failed west suburban bank was making a tidy profit by hiding his personal stake in some large loans made by the institution, which eventually lost nearly $700,000 on the deals.
James A. Regas, 82, of Oak Brook, pleaded guilty Wednesday to making false statements in regulatory documents regarding his personal interest in loans while he was chairman of the board of the former Western Springs National Bank & Trust, according to federal prosecutors.
Regas admitted falsifying and concealing material facts that should have been fully disclosed to the bank's directors and government regulators during 2008 and 2009, a release from the U.S. Attorney's Office said.
The bank lost at least $681,617 on those loans, and its two branches were closed by federal regulators in April 2011, its assets purchased by Heartland Bank and Trust Co.
Regas was charged June 19 with one count of scheming to make false statements and pleaded guilty Wednesday before U.S. District Judge Gary Feinerman, who set sentencing for Oct. 25. Regas faces a maximum of five years in prison and a $250,000 fine, and has agreed to pay full restitution, the release said.
According to his plea agreement, Regas caused bank employees to file false quarterly Reports of Condition and Income with FDIC and signed the reports knowing they contained false information regarding the delinquency of certain loans.
He also admitted that between 2004 and 2009 he referred business associates to the bank for loans, without disclosing he had financial partnerships with and would benefit from the loans. He submitted false conflict-of-interest statements denying the financial relationships, the release said.
The loans included:
— $803,000 to North Park Webster LLC in December 2004, used partially to finance the purchase of three properties in Evanston — 917 Edgemere Ct., 925 Edgemere Ct. and 1216 North Sheridan Rd. — in which Regas and family members had stakes;
— $500,000 to one of Regas' associates in November 2005, from which he got about half of the proceeds indirectly through a third-party; and
— $750,000 to a real estate investor in September 2008 to finance purchase of an apartment building at 814-816 Mulford in Evanston from Regas. The building also served as collateral on another loan Regas acquired and sold through a nominee company.
