A federal jury found the former president and CEO of NOVA Bank guilty of criminally defrauding the government earlier this year, and on Tuesday, Brian Hartline received his prison sentence: 14 months.
HousingWire staffer Ben Lane reports that Hartline was convicted of faking millions of dollars in investments in the bank as part of a scheme to defraud the federal government of more than $13 million from the Troubled Asset Relief Program.
Here’s was Hartline was convicted of doing:
In an attempt to save the failing bank, NOVA Financial Holdings, the parent company of NOVA Bank, applied for approximately $13.5 million in TARP funds. The bank was one of just seven out of 700 banks that applied for TARP funds to be conditionally approved.
As part of that conditional approval, the government stipulated that the bank would only receive TARP money if it raised $15 million from investors.
Hartline and others then devised a scheme to make NOVA Bank appear more financially sound than it was, making it look like the bank was receiving funds from outside investors, when the bank was actually recycling its own money to make it look like new money.
“Pure and simple, Hartline committed fraud in an attempt to get TARP,” SIGTARP’s Christy Goldsmith Romero said.