Saturday, May 4, 2013

Two Helena residents sentenced for fraud conspiracy

Two Helena residents sentenced for fraud conspiracy, An FBI press release dated May 3, 2013, announced that Sheryl Gillespie, 50, and Dean Austin South, 70, both residents of Helena, appeared before U.S. District Judge Dana L. Christensen, for sentencing. They had previously pled guilty to conspiracy to commit fraud. Each were sentenced to five years probation, with a special assessment of $100 and restitution to be determined.

Assistant U.S. Attorney Bryan R. Whittaker offered proofs at the plea hearing which would have proven the pair’s complicity to devise a scheme to obtain moneys, funds, or credits, owned by or under the custody and control of Banner Bank.

South was part owner in the Superior Propane business in Helena. Superior Propane operated as a wholesale propane company by purchasing propane directly from the refineries and selling the propane to end-users such as retail/convenience stores. Superior Propane transported the propane from the refineries to their customers, but also contracted with other companies to assist them with the transportation of the propane. Texas Propane Energy (TPE), based in Cibolo, Texas, acted as a retail distributor of propane by servicing end-use customers in the southwestern United States. TPE was one of Superior Propane’s largest customers. South was also a partner in Texas Propane Energy.

Superior Propane relied upon an approximate $7.5 million line of credit from Banner Bank to assist in meeting its expenses such as payroll and other financial obligations including operating expenses and obtaining inventory.

For Superior Propane to obtain access to the line of credit, Banner Bank required monthly reporting to them with a form called a Borrowing Base Certificate as well as an accounts receivable ledger showing Superior Propane’s receivables. Banner Bank required that a certain percentage of Superior Propane’s current receivables be tied to the line of credit before allowing future credit draws to occur. The account receivables were considered current by Banner Bank for a 90-day period. After the 90-day period, the account receivables were not included in the percentage calculation against the line of credit. Because Superior Propane’s actual account receivables would not have allowed access to the line of credit under Banner Bank’s percentage formula, South and Gillespie falsified and caused to be falsified Superior Propane’s account records, thereby allowing access to the line of credit. (FBI press release)

In order to execute and accomplish the conspiracy, SOUTH and GILLESPIE, unlawfully and without authorization, “spread” or applied account receivables that extended beyond 90 days to other customer accounts thereby reflecting the balance for these accounts as current when it fact it was not current. Consequently, Superior Propane was able to increase the amount of money, funds, and credit it could draw from Banner Bank. SOUTH directed other members of the conspiracy, including GILLESPIE, to create Excel spreadsheets reflecting materially false account receivables which were supplied monthly—and sometimes weekly—to Banner Bank. Banner Bank relied upon the representations in these spreadsheets (and other information provided by Superior Propane) when making credit and lending decisions (

Two Helena residents sentenced for fraud conspiracy Rating: 4.5 Diposkan Oleh: Unknown


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