Former CEO of failed Oklahoma bank pleads guilty to bank fraud

Former First National Bank of Lindsay, Okla., President and CEO Danny Seibel pleaded guilty May 4 to one count of bank fraud in connection with the bank’s 2024 failure..Seibel, 55, pleaded guilty to one count of bank fraud. He admitted to participating in the fraud between February 2020 and September 2024, while he was a loan officer. He allegedly approved multiple loans to personal friends and neighbors that were neither paid bank nor recorded. According to prosecutors, some borrowers knew Seibel had posted fake loans to their accounts or made fraudulent entries in bank records about their loans and accounts.Two borrowers allegedly asked Seibel to manually add bank funds to their overdrawn accounts when they needed money. Seibel, on several occasions, allegedly claimed disbursed loans were to acquire or improve real estate, vehicles or equipment when they were instead used to repay other loans, gamble, or pay daily expenses. In March 2020, Seibel allegedly authorized a nearly $69,000 loan to a company he co-owned to purchase real estate. He reportedly never made payments on the loan and instead used the bank’s computer system to extend the maturity date on the loan multiple times between 2020-23. In February 2023, Seibel allegedly manually added $526,000 to an account overdrawn by $713,892. He later reportedly created a $400,000 loan to pay off the rest of the overdraft. “I knowingly executed a scheme or artifice to defraud the First National Bank of Lindsay by means of false or fraudulent pretenses, representations or promises,” Seibel wrote in his plea agreement. “First National Bank of Lindsay was FDIC insured and I acted with intent to defraud it. My fraudulent actions were capable of influencing the decision of the bank and I placed the bank at risk of civil liability or financial loss.”As of June 30, 2024 The First National Bank of Lindsey had $108 million in assets. Of the bank’s $97.5 million in deposits, $7.1 million allegedly exceeded FDIC insurance limits. Seibel was an executive at the bank from February 2007 until he was fired in September 2024. The Office of the Comptroller of the Currency closed The First National Bank of Lindsay a little more than a month after Seibel’s firing, after finding “false and deceptive bank records and other information suggesting fraud that revealed depletion of the bank’s capital.” A sentencing date has not been set. Bank fraud carries a maximum sentence of 30 years in prison. As part of the plea deal, prosecutors would recommend that Seibel receive a reduced sentence because he accepted responsibility for the crime, so long as he does not commit another crime. Seibel was also initially charged with four other counts of bank fraud; one count of conspiracy to commit bank fraud; 10 counts of making false bank entries; one count of obstructing the examination of a financial institution; and one count of failing to maintain an effective anti-money laundering program.