Defense attorneys claim false testimony led to Wilmington Trust indictments


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Attorneys representing four ex-Wilmington Trust executives accused of criminal bank fraud say prosecutors knowingly presented false testimony during the defendants' grand jury hearing.

The defense attorneys have asked the court to grant discovery so they can collect evidence to present their claim. In addition, they are asking the court to dismiss some of the charges against the executives.

"It appears that the government ran afoul of a basic prohibition — that the government may not secure an indictment based on the knowing presentation of false testimony to the grand jury," defense attorney Michael Kelly wrote in an 11-page motion filed late Tuesday.

Former Wilmington Trust president Robert Harra Jr., former chief financial officer David Gibson, former chief credit officer William North and former controller Kevyn Rakowski face trial in October on charges of fraud, conspiracy and making false statements to federal regulators.

Prosecutors contend these four individuals defrauded the Federal Reserve Bank and others by misrepresenting the bank's failing commercial loan portfolio before it collapsed in 2011.

A key part of the prosecutors' claim is that the defendants did not label certain mature loans as "past-due." That is based, partly, because Federal Reserve Bank examiner David Fomunyam told prosecutors in 2013 that Wilmington Trust executives never reported the past-due loans, according to court documents.

But defense attorneys say the grand jury testimony of an unnamed FBI agent directly contradicts Fomunyam's statements. The FBI agent testified that Fomunyan told him he was "unaware" if defendants failed to report past due loans.

Three of the assistant United States attorneys who had been present during Fomunyan's 2013 interview were also present during the FBI agent's testimony and one of those attorneys questioned the FBI agent, according to court documents. Yet none of the attorneys raised the issue of Fomunyan's earlier statements, defense attorneys allege.  

"That the government withheld this highly exculpatory information for two years is inexplicable," Kelly wrote in the motion. "Even more troubling and pertinent to this motion, the government presented the following testimony to the grand jury."

 Kelly declined to comment on the motion.

David C. Weiss, Acting U.S. Attorney said the defendants' motion is without merit and the government will be filing a response in due course.

The defense attorneys have asked the U.S. District Court for the District of Delaware to grant discovery to pursue this claim. They have asked prosecutors to turn over all notes and documents from interviews with Fomunyam and Federal Reserve Bank examiner James Corkery along with certain grand jury hearings.

In addition, the defense has asked for an evidentiary hearing to question the testifying FBI agent, Fomunyam and all members of the prosecution team who attended Fomunyam's interview.

A previous attempt by defense attorneys to subpoena Federal Reserve officials was squashed by a federal judge last month. Defense attorneys were seeking a variety of documents involving the Federal Reserve's supervision and monitoring of Wilmington Trust.

 

Article From:- https://www.delawareonline.com

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