Real Estate Developer Admits Fraud Charges

Allison Tussey —  March 22, 2011 — Leave a comment

James Summers, St. Charles, Missouri, pled guilty to multiple fraud charges involving his Cool Springs development in St. Charles County.

According to court documents, Summers owned and operated Quality Building Systems and D&M Properties. Summers used these businesses to develop commercial real estate projects, including construction projects in St. Charles County, Missouri. In December 2007 and June 2008, Summers obtained financing from 1st Advantage Bank to purchase three lots in St. Charles County, Missouri, and to construct a commercial building on one of the lots. The property was known as the Cool Springs project. The loans were for approximately $450,000 and $745,000, respectively. The portion of the funds allocated for construction remained with 1st Advantage Bank. The construction funds were only to be disbursed for work completed. In 2008, Summers submitted a series of false and fraudulent invoices and vouchers in order for 1st Advantage to release construction funds, which he then deposited and used for other purposes. In reality, no construction work was ever done and the lot remains substantially undeveloped. As part of his plea agreement, Summers acknowledged that the scheme resulted in an actual loss of greater than $400,000.

Summers pled guilty to three felony counts of bank fraud before United States District Judge Audrey G. Fleissig. Sentencing has been set for June 16, 2011.

Each count of bank fraud carries a maximum penalty of 30 years in prison and/or fines up to $1,000,000. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

The United States Attorney’s Office announced the guilty plea.

This case was investigated by the Federal Bureau of Investigation. Assistant United States Attorney John Bodenhausen is handling the case for the U.S. Attorney’s Office.

 

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Allison Tussey

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