This story appeared in Bank Digest.
Christy Romero, Special Inspector General for the Troubled Asset Relief Program, and Charles M. Oberly III, United States Attorney for the District of Delaware, have announced that on Nov. 24, 2014, United States District Judge Richard G. Andrews sentenced James A. Ladio, age 58, of Wilmington, Del., to two years in federal prison for his role in a loan scheme involving TARP recipient Wilmington Trust Corporation.
Ladio, former president and chief executive officer of MidCoast Community Bank, pled guilty on Dec. 17, 2013, to two counts of bank fraud and two counts of money laundering. The charges related to a nominee loan scheme in which Ladio recruited two former MidCoast customers to obtain loans, the proceeds of which the customers loaned back to Ladio.
According to facts revealed during the sentencing hearing, Ladio had been involved in a decade-long "loan-swap" arrangement with former Wilmington Trust market manager Brian Bailey, in which the two men allegedly provided more than 20 loans to each other totaling more than $1.5 million. In June 2010, Wilmington Trust called Ladio's loans and required him to enter into a Global Restructuring Agreement. Ladio was said to have engaged in the nominee loan scheme in substantial part to make interest and principal payments under the agreement.