Posted on 11/07/2002 9:59:15 AM PST by AdA$tra
The Associated Press
Westar Energy Inc.'s top executive and the president of a Topeka bank were indicted by a federal grand jury on fraud charges, U.S. Attorney Eric Melgren announced today.
David Wittig, Western's chairman, president and chief executive officer, faces four counts of submitting false entries, books, reports or statements to a federally insured bank; one count of conspiracy and one count of money laundering.
The indictment also alleges in a separate count that the government is owed $1.5 million because of the alleged actions.
There was no indication that the indictment involved Westar's business matters. Westar is the state's largest electric company.
Also indicted on the same charges is Clinton Odell Weidner II, the former president of the Capital City Bank. The bank placed him on administrative leave in March, the U.S. attorney's office said.
The charges in the indictment stem from Weidner's decision in April 2001 to increase Wittig's line of credit at the bank.
The U.S. attorney's office said Weidner proposed a real estate venture in Scottsdale, Ariz., to Wittig that required a $1.5 million downpayment. According to the indictment, Wittig declined the offer but agreed to make a loan in the same amount if Weidner would increase Wittig's credit.
The indictment accuses the two men of trying to conceal their deal and the reason for the credit line increase from the bank.
"Maintaining public confidence in our financial institutions and markets requires that filings be complete and accurate," Melgren said in a statement. "We take these crimes very seriously and will be very aggressive in investigating and prosecuting them."
The conspiracy charge carries a maximum punishment of five years in prison without parole. Each charge of making a false bank statement carries a maximum penalty of 30 years in prison, while money laundering is punishable by up to 10 years in prison.
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