gilbert indictment

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF OREGON

(EUGENE DIVISION)

UNITED STATES OF AMERICA, ) Case No. I \ - to()()D~- PsA )

Plaintiff, ) INDICTMENT )

v. ) [18 U.S.C. §§ 1349, 1344, and 2] )

DAVID GILBERT, ) Conspiracy to Commit Bank Fraud )

Defendant. ) Bank Fraud

THE GRAND JURy CHARGES:

INTRODUCTORY ALLEGATIONS

At all times relevant to this Indictment:

1. DAVID GILBERT ("defendant GILBERT") was a resident of Roseburg, Oregon.

2. Defendant GILBERT had an ownership interest in and operated Bruce Gilbert,

Inc., a car dealership in Roseburg, Oregon.

3. Bruce Gilbert, Inc., did business as Horizon Honda Mazda.

4. PremierWest Bank ("PWB") and Northwest Community Credit Union ("NCCU")

are financial institutions as defined in 18 U.S.C. § 20.

INDICTMENT -

Case 6:11-cr-60003-AA Document 1 Filed 01/19/11 Page 1 of 7 Page ID#: 1

herein.

COUNT ONE

(Conspiracy to Commit Bank Fraud)

OBJECTS OF THE CONSPIRACY

5. Paragraphs One through Four of the Introductory Allegations are incorporated

6. Beginning in or about May 2008 and continuing through December 2008, in the

District of Oregon and elsewhere, defendant GILBERT and others, known and unknov.'Il to the

grand jury, knowingly executed and attempted to execute a scheme and artifice to defraud PWB

and NeeU as to material matters through a check-kiting scheme.

MANNER AND MEANS AND SCHEME TO DEFRAUD

7. Defendant GILBERT and his co-conspirators, known and unknown to the grand

jury, used the following manner and means, among others, to carry out the conspiracy and check

kiting scheme:

8. Defendant GILBERT maintained and controlled checking accounts at PWB and

NeeU through his car dealership, Bruce Gilbert, Inc., dba Horizon Honda Mazda Nissan.

Defendant Gilbert's bookkeeper also had access to and signatory authority for these bank

accounts. Throughout 2008, defendant GILBERT's car dealership experienced cash flow and

financial problems which routinely led to a shortage of funds in the checking accounts at PWB

and NCCD. To cover the shortages, defendant GILBERT and others created and executed a

scheme to kite checks in order to artificially inflate the account balances in the checking accounts

at PWB and NeCD.

INDICTMENT -


9. Almost each workday morning, defendant Gilbert met with his bookkeeper to

discuss the account balances of the checking accounts at PWB and NeeU. Prior to each

meeting, at defendant Gilbert's request, his bookkeeper determined the actual account balances

for the checking accounts at PWB and NeeU, including the shortage for each account. Due to

the check-kiting scheme, the actual balances for the checking accounts at PWB and NeeU were

different than the balances reflected on PWB's and NeeU's statements and records for those

accounts. For several months prior to December 2008, the actual account balance for each

checking account was negative. After each meeting, defendant Gilbert told his bookkeeper to

artificially inflate the checking account balances at PWB and NeeU by a particular amount in

order to create the facade of positive balances.

10. To artificially inflate the checking accounts at PWB and NeCU and to maintain

the inflated account balances during the course of the scheme, defendant GILBERT and others

deposited, or caused others to deposit, checks between the checking accounts at PWB and

NCCU, including more than 500 kited checks, totaling more than $19 million, from December 1,

2008, through December 9, 2008.

11. This was done by defendant GILBERT and others in such a marmer and at such

times so as to artificially and fraudulently inflate the numerical balances in the checking accounts

at PWB and NCeU. By doing so, defendant Gilbert and others created the false and fraudulent

appearance that there were sufficient legitimate available funds in the checking accounts at PWB

and NeCU and caused PWB and NCCU into unwittingly honoring checks drawn against

accounts with insufficient funds.

INDICTMENT -


12. Defendant Gilbert and others wrote the kited checks, or caused others to write the

kited checks, for amounts that were consistent with prior legitimate deposits. Typically,

defendant GILBERT and his bookkeeper signed all the checks, including the kited checks, to be

deposited. Defendant GILBERT and others bundled or grouped the checks to be deposited,

including the kited checks, or caused others to do so, in an effort to disguise the kite. Defendant

Gilbert and others also timed the deposits of the kited checks to ensure that PWB and NeeD

would not return the kited checks for insufficient funds and discover the check-kiting scheme.

13. Defendant GILBERT knew that PWB and NeeD would provide him with instant

credit for the deposited checks when, in reality, many of the deposited checks were worthless

because there were no legitimate funds in the accounts from which the deposited checks were

written. Through this scheme, defendant GILBERT and others falsely but successfully inflated

the balances of available funds in the checking accounts at PWB and NeeD. In effect, defendant

GILBERT and others, through the check-kiting scheme, wrote a series of unauthorized,

unsecured, and interest-free loans which put PWB and NeeD at risk for the insufficient funds

and deprived PWB and NeeD of their assets. In December 2008, PWB and NeeD discovered

the check-kiting scheme, refused to honor a number of kited checks, and the scheme collapsed.

Through their check-kiting scheme, defendant GILBERT and others caused PWB and NCCD to

incur substantial losses.

OVERT ACTS IN FURTHERANCE OF THE CONSPIRACY

14. In furtherance of the conspiracy and to affect the object thereof, the following

overt acts, among others, were committed in the District of Oregon and elsewhere:

INDICTMENT -


15. On or about December 1,2008, defendant GILBERT caused check #1803 from

the Horizon Honda Mazda Nissan checking account at NCCU to be deposited into the Bruce

Gilbert, Inc., checking account at PWB.

16. On or about December 1, 2008, defendant GILBERT caused check #1838 from




the Horizon Honda Mazda Nissan checking account at NCeU to be deposited into the Bruce






the Bruce Gilbert, Inc., checking account at PWB to be deposited into the Horizon Honda Mazda

Nissan checking account at NeeU.

20. On or about December 1, 2008, defendant GILBERT caused check # 195964 from


Nissan checking account at NeCU.

21. On or about December 2, 2008, defendant GILBERT caused check # 196212 from


Nissan checking account at NeeU.

INDIClMENT -




Nissan checking account at NCCU.

All in violation of 18 U.S.C. § 1349.

COUNTS TWO THROUGH NINE

(Bank Fraud)

23. Paragraphs One through Four of the Introductory Allegations and Paragraphs Six

through Thirteen of the Manner and Means and Scheme to Defraud of Count One are

incorporated herein.

24. On or about the dates set forth in each count below, in the District of Oregon and

elsewhere, defendant GILBERT knowingly executed and attempted to execute a scheme and

artifice to defraud PWB and NCCU as to material matters as described below:

COUNT EXECUTION

2 On or about December 1, 2008, defendant GILBERT executed and attempted to execute the scheme by causing check #1803, in the amount of $37,346, drawn on the Horizon Honda Mazda Nissan checking account at NCCU to be deposited into the Bruce Gilbert, Inc., checking account at PWB.

3 On or about December 1, 2008, defendant GILBERT executed and attempted to execute the scheme by causing check #1838, in the amount of$37,825, drawn on the Horizon Honda Mazda Nissan checking account at NCCU to be deposited into the Bruce Gilbert, Inc., checking account at PWB.

4 On or about December 2,2008, defendant GILBERT executed and attempted to execute the scheme by causing check #1877, in the amount of $39,075, drawn on the Horizon Honda Mazda Nissan checking account at NCCU to be deposited into the Bruce Gilbert, Inc., checking account at PWB.

5 On or about December 5, 2008, defendant GILBERT executed and attcmpted to execute the scheme by causing check #2014, in the amount of$41,01O, drawn an

INDICTMENT -


6

7

8

9

the Horizon Honda Mazda Nissan checking account at NCCU to be deposited into the Bruce Gilbert, Inc., checking account at PWB.

On or about December 1,2008, defendant GILBERT executed and attempted to execute the scheme by causing check #195962, in the amount of$37,226.49, drawn on the Bruce Gilbert, Inc., checking account at PWB to be deposited into the Horizon Honda Mazda Nissan checking account at NCCU.

On or about December 1,2008, defendant GILBERT executed and attempted to execute the scheme by causing check #195964, in the amount of$38,075, drawn on the Bruce Gilbert, Inc., checking account at PWB to be deposited into the Horizon Honda Mazda Nissan checking account at NCCU.

On or about December 2, 2008, defendant GILBERT executed and attempted to execute the scheme by causing check #196212, in the amount of$36,019.53, drawn on the Bruce Gilbert, Inc., checking account at PWB to be deposited into the Horizon Honda Mazda Nissan checking account at NCCU.

On or about December 5, 2008, defendant GILBERT executed and attempted to execute the scheme by causing check #196244, in the amount of$34,990, drawn on the Bruce Gilbert, Inc., checking account at PWB to be deposited into the Horizon Honda Mazda Nissan checking account at NCCU.

All in violation of 18 U.S.C. §§ 1344(1) and 2.

DATED this J.i.. day of January 2011.

A TRUE BILL

sf GRAND JURY FOREPERSON

FOREPERSON V DWIGHT C. HOLTON United States Attorney

. RADFORD .S. Attorney

INDICTMENT -


gilbert indictment

Documents