Larry Gene Webb, 65, of Smithville, Tennessee, former Deputy Director of the Upper Cumberland Development District (UCDD), and former Director of the Cumberland Regional Development Corporation (CRDC), pleaded guilty yesterday, before U.S. District Judge Aleta A. Trauger, to one count of bank fraud, announced David Rivera, U.S. Attorney for the Middle District of Tennessee. Webb was indicted in September 2013 for his participation in a scheme to commit bank fraud and to steal federal and state funds intended to promote economic and housing development.

UCDD is a quasi-governmental agency that receives federal and state funds and is responsible for promoting economic development throughout the 14 counties located in the Upper Cumberland Region of Tennessee. CRDC operates under the UCDD umbrella and assists in the creation of affordable housing.

During the plea hearing, Webb acknowledged that he, along with co-defendant Wendy Askins, defrauded the Bank of Putnam County when applying for a loan on May 27, 2010. To obtain the loan, Webb told bank officers that the UCDD and CRDC boards of directors had approved the loan request to fund a UCDD program called “Living the Dream.” Webb submitted fake CRDC resolutions with the loan application stating that he and Askins were permitted to obtain a $750,000 loan for the “Living the Dream” project. The Bank of Putnam County relied upon the fraudulent documents and funded $731,000 for the “Living the Dream” project. Webb admitted that neither UCDD nor the CRDC had authorized a loan for “Living the Dream” and further admitted that a portion of the loan proceeds had been used to build a luxury, personal residence for Wendy Askins.

At the time of the fraudulent loan, Askins was the Executive Director of UCDD and Webb was Deputy Executive Director of UCDD and Director of the CRDC. According to facts set forth in the plea agreement, the bank would not have approved the loan had it known the project was not sponsored by the UCDD and CRDC.

Webb is scheduled to be sentenced on November 24, 2015. Bank fraud carries a maximum penalty of 30 years in prison and a $1,000,000 fine.

Wendy Askins, the remaining defendant, is currently scheduled for trial on September 22, 2015, in the U.S. District Court in Nashville. She is presumed innocent unless and until proven guilty.

The case was investigated by the U.S. Department of Commerce-Office of Inspector General; the FBI; the U.S. Health and Human Services- Office of Inspector General; the Internal Revenue Service-Criminal Investigation and the Housing and Urban Development-Office of Inspector General. The United States is represented by Assistant U.S. Attorneys Stephanie N. Toussaint, William L. Deneke, and Byron M. Jones.