Mark Turkcan Press Release (Indictment)

July 10, 2008
For Immediate Release

FORMER PRESIDENT OF FIRST BANK MORTGAGE INDICTED ON MULTIPLE FRAUD CHARGES CAUSING A LOSS OF $35 MILLION TO A LOCAL BANK

St. Louis, MO: Mark Turkcan is charged in an eleven-count indictment alleging fraudulent activities connected with his position at First Bank Mortgage, causing a loss of $35 million, United States Attorney Catherine L. Hanaway and John Gillies, Special Agent in Charge, FBI-St. Louis, announced today.

“The indictment alleges that Mark Turkcan, as President of First Bank Mortgage, a division or wholly-owned subsidiary of First Bank, misapplied monies of the Bank, which caused them to pay loans, interest, commissions and other fees of more than $35 million to Bear Stearns, due to concealment of unauthorized and unapproved borrowings made on behalf of First Bank Mortgage,” said Hanaway.

According to the indictment, the losses began as early as 1987 when Turkcan was employed by Sheahan Financial, which, along with Clayton Savings and Loan, was purchased by First Bank. The substantial losses that Turkcan incurred at Sheahan were from hedge positions taken on behalf of Sheahan, and were concealed at Sheahan. In 1990, First Bank purchased Clayton Savings and Loan and Sheahan Financial without knowing abut the losses concealed on the books of Sheahan Financial, causing First Bank to overpay in the purchase. After the purchase of Sheahan in 1990, Turkcan became President of First Bank Mortgage. He continued to buy and sell mortgage-backed securities as part of his job. However, losses from the unauthorized and unapproved borrowings continued ultimately rising to a level of approximately $35 million. They were covered up and concealed from First Bank by destroying or changing records and posting profits on the books and records of the Bank. To cover the losses, Turkcan borrowed against the mortgage-backed securities of First Bank Mortgage. These loans were also concealed from First Bank. To conceal the true nature of these transactions, Turkcan created false and fictitious trade tickets and Bear Stearns confirmations.

The indictment alleges that ultimately these losses rose to a level of approximately $35 million, which First Bank had to pay Bear Stearns.

MARK TURKCAN, Kirkwood, Missouri, was indicted by a federal grand jury on eight felony counts of wire fraud, one felony count of misapplication of bank money, one felony count of making false bank entries (counts 9 & 10); and one felony count of causing the filing of a false annual report (Count 11).
If convicted, each wire fraud count carries a maximum penalty of 30 years in prison and/or fines up to $1 million; counts 9 & 10 each carry a maximum of 30 years in prison and/or fines up to $1 million; and count 11 carries a maximum of 20 years in prison and/or fines up to $5 million. Restitution is mandatory on all counts.

Hanaway commended the First Bank’s officers and employees for bringing this information to the U.S. Attorney’s Office, and the Federal Bureau of Investigation for their expeditious investigation of this case. First Assistant Michael W. Reap is handling the case for the U.S. Attorney’s Office.

The charges set forth in an indictment are merely accusations, and each defendant is presumed innocent until and unless proven guilty.

UNITED STATES ATTORNEY'S OFFICE EASTERN DISTRICT OF MISSOURI CATHERINE L. HANAWAY United States Attorney	NEWS RELEASE
For further information: Call Public Affairs Officer Jan Diltz at (314) 539-7719
July 10, 2008 For Immediate Release FORMER PRESIDENT OF FIRST BANK MORTGAGE INDICTED ON MULTIPLE FRAUD CHARGES CAUSING A LOSS OF $35 MILLION TO A LOCAL BANK St. Louis, MO: Mark Turkcan is charged in an eleven-count indictment alleging fraudulent activities connected with his position at First Bank Mortgage, causing a loss of $35 million, United States Attorney Catherine L. Hanaway and John Gillies, Special Agent in Charge, FBI-St. Louis, announced today. “The indictment alleges that Mark Turkcan, as President of First Bank Mortgage, a division or wholly-owned subsidiary of First Bank, misapplied monies of the Bank, which caused them to pay loans, interest, commissions and other fees of more than $35 million to Bear Stearns, due to concealment of unauthorized and unapproved borrowings made on behalf of First Bank Mortgage,” said Hanaway. According to the indictment, the losses began as early as 1987 when Turkcan was employed by Sheahan Financial, which, along with Clayton Savings and Loan, was purchased by First Bank. The substantial losses that Turkcan incurred at Sheahan were from hedge positions taken on behalf of Sheahan, and were concealed at Sheahan. In 1990, First Bank purchased Clayton Savings and Loan and Sheahan Financial without knowing abut the losses concealed on the books of Sheahan Financial, causing First Bank to overpay in the purchase. After the purchase of Sheahan in 1990, Turkcan became President of First Bank Mortgage. He continued to buy and sell mortgage-backed securities as part of his job. However, losses from the unauthorized and unapproved borrowings continued ultimately rising to a level of approximately $35 million. They were covered up and concealed from First Bank by destroying or changing records and posting profits on the books and records of the Bank. To cover the losses, Turkcan borrowed against the mortgage-backed securities of First Bank Mortgage. These loans were also concealed from First Bank. To conceal the true nature of these transactions, Turkcan created false and fictitious trade tickets and Bear Stearns confirmations. The indictment alleges that ultimately these losses rose to a level of approximately $35 million, which First Bank had to pay Bear Stearns. MARK TURKCAN, Kirkwood, Missouri, was indicted by a federal grand jury on eight felony counts of wire fraud, one felony count of misapplication of bank money, one felony count of making false bank entries (counts 9 & 10); and one felony count of causing the filing of a false annual report (Count 11). If convicted, each wire fraud count carries a maximum penalty of 30 years in prison and/or fines up to $1 million; counts 9 & 10 each carry a maximum of 30 years in prison and/or fines up to $1 million; and count 11 carries a maximum of 20 years in prison and/or fines up to $5 million. Restitution is mandatory on all counts. Hanaway commended the First Bank’s officers and employees for bringing this information to the U.S. Attorney’s Office, and the Federal Bureau of Investigation for their expeditious investigation of this case. First Assistant Michael W. Reap is handling the case for the U.S. Attorney’s Office. The charges set forth in an indictment are merely accusations, and each defendant is presumed innocent until and unless proven guilty.