Dothan Man Pleads Guilty to Bank Embezzlement Charges
|U.S. Attorney’s Office July 19, 2010|
MONTGOMERY, AL—James E. Goldsborough, age 70, pled guilty today before United States Magistrate Judge Terry F. Moorer to a one-count felony information charging him with embezzling funds of PeoplesSouth Bank (“PSB”), in violation of Title 18, United States Code, Section 656, U.S. Attorney Leura G. Canary announced.
According to the plea agreement, Goldsborough worked for PSB in Dothan since 1992—first as president and, later, executive vice president. In these positions, Goldsborough had the authority to approve loans up to $25,000.
Goldsborough began embezzling in approximately 1992. He accomplished this by opening a bank account in the name of the fictitious entity. He would then approve loans to fictitious borrowers in amounts of $25,000 or less, deposit the loan proceeds in the account, and use the money either for personal expenses or to repay previously obtained fraudulent loans. Goldsborough would occasionally receive the loan proceeds in cash, falsely representing to the teller that he intended to personally deliver the funds to the borrower. Goldsborough classified the loans as commercial loans because there was no minimum monthly payment—the only requirement was that the loan be paid in full when due. When a loan would become due, Goldsborough would arrange for a new fictitious loan and use those funds to pay the loan that was due. Goldsborough also used his knowledge of PSB's security procedures to avoid certain anti-fraud measures.
At the time Goldsborough's embezzlement scheme was detected in August 2009, PSB's records show that approximately 92 fictitious loans were outstanding with a total principal balance of approximately $1,850,999.23. However, under the plea agreement, Goldsborough reserves the right to argue that the amount is less for purposes of computing his sentence and the amount of restitution.
When he is sentenced this fall by United States District Judge W. Keith Watkins, Goldsborough faces a statutory maximum sentence of 30 years’ imprisonment, a term of supervised release of no more than five years, a fine of up to $1,000,000 (or, if greater, twice the loss to PSB), and an order of restitution. Judge Moorer released Goldsborough on a $25,000 unsecured bond pending sentencing.
The case was investigated by the Federal Bureau of Investigation and was prosecuted by Assistant U.S. Attorney Andrew O. Schiff.