2 Charged with Conspiracy to Defraud Lenders

Allison Tussey —  April 17, 2015 — Leave a comment

Jeffery Allen Gardner, 61, Hopkins, Minnesota, and Stuart Alan Voigt, 66, Apple Valley, Minnesota, have been indicted and charged with conspiring to defraud individuals and financial institutions, bank fraud and making a false statement in a loan application.

In an indictment unsealed on July 24, 2014, Gardner was charged with conspiracy to commit mail and wire fraud and other charges. In a superseding indictment filed, Voigt is also charged with conspiracy to commit mail fraud and other charges, and both defendants are additionally charged with bank fraud and making a false statement in a loan application.

According to the indictment and documents filed in court, between 2005 and 2007, Gardner and Voigt solicited and raised funds from private investors in connection with Gardner’s business entity, Hennessey Financial, LLC. Investors were told that their investment would be used for commercial real estate financing and related projects, and were promised returns of between 10 and 20 percent annually. However, according to the superseding indictment, Gardner, Voigt, and others misrepresented the true financial circumstances of Hennessey to the victim investors.

According to the indictment and documents filed in court, Gardner did not use Hennessey’s funds substantially as promised, instead diverting them to unapproved uses, including for repayments to prior investors and preexisting debts incurred by Gardner and his companies. Moreover, even when Gardner knew that Hennessey was failing as a business and unlikely to meet its obligations to repay investor funds, his company’s communications still represented to investors that their investments had positive value and were expected to continue to yield previously promised returns.

According to the indictment and documents filed in court, during the time period when Hennessey was failing, Gardner and Voigt created new companies, opened bank accounts in the names of new companies, transferred funds from Hennessey accounts, and took other steps to hide income and assets from investors, creditors, and the government.

According to the indictment and documents filed in court, Voigt knowingly engaged in monetary transactions of criminally derived property, namely multiple payments exceeding $50,000 each drawn from a Hennessey Financial account and made payable to Voigt. During this same time period, Voigt was the chairman of the board of First Commercial Bank (FCB). According to the charges, in order to keep Hennessey afloat and provide funds to funnel back to Voigt, Gardner and Voigt  secured loans for Gardner from FCB without truthfully disclosing Gardner ’S financial situation. The defendants filed security interests and took other steps to allow another company to obtain Hennessey assets that Gardner had presented as security for the loans from FCB, thereby depriving FCB of collateral and reducing the likelihood that FCB would be made whole.

According to the indictment and documents filed in court, Gardner also misrepresented the reason Hennessey’s CFO resigned in early 2008. He told FCB that the CFO had been dismissed because he was only working 20 hours per week and was having family issues, when in truth, the CFO resigned due to concerns he had about Hennessey’s financial condition and representations made to investors.

According to the indictment and documents filed in court, Voigt also made false statements to Tradition Capital Bank in connection with a personal loan. Voigt is charged with misrepresenting the value of his assets in personal financial statements made to the bank.

United States Attorney Andrew M. Luger announced the superseding indictment.

This case is the result of an investigation conducted by the United States Postal Inspection Service, Federal Bureau of Investigation, the Federal Deposit Insurance Corporation Office of the Inspector General, and the Minnesota Department of Commerce – Fraud Bureau.

This case is being prosecuted by Assistant U.S. Attorney Robert M. Lewis.

“Those who hold positions of responsibility in the banking and investment industries are duty-bound to be honest and forthright with their clients,” said U.S. Attorney Luger. “We will continue to work with all of our federal and state partners to protect this important principle.”

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Allison Tussey

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