Man Admits Using False Documents to Obtain $6M in Loans

Allison Tussey —  May 19, 2015 — Leave a comment

Ray M. Mubarak, 55, Knoxville, Tennessee, pleaded guilty on May 18, 2015, in the U.S. District Court for the Eastern District of Tennessee, Knoxville, to conspiracy to commit bank fraud, bank fraud, and engaging in an unlawful monetary transaction with bank fraud proceeds.

Sentencing has been set for 10:00 a.m. on September 28, 2015.

Mubarak faces a maximum of up to 130 years in prison, as well as supervised release following incarceration, restitution, and fines. Pursuant to the plea agreement, Mubarak admitted that the loss to the banks resulting from the scheme was more than $1,000,000, but less than $2,500,000.

The plea agreement on file with the United States District Court details the scheme to which Mubarak admitted, including providing false tax returns and financial statements to Pinnacle National Bank, SmartBank, and Bank of America in association with loans totaling in excess of $6,000,000. Mubarak further admitted to using loan proceeds for purposes other than those for which Mubarak represented the funds would be used, including paying gambling debts, making deposits to a personal stock trading account, and purchasing vehicles.

Agencies involved in the investigation leading to the indictment and guilty plea included the Internal Revenue Service—Criminal Investigation and the Federal Bureau Investigation. The investigation and prosecution of Mubarak was coordinated with the Office of the District Attorney General, 6th Judicial District. Matthew T. Morris, Assistant U.S. Attorney, represented the United States.

Allison Tussey

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