The head of BB&T's Chattanooga commercial banking operations has been charged by federal authorities with making fraudulent loans.
Tracy Brown is set to plead guilty to bank fraud on June 4.
Authorities said Brown "appropriated the identities of three customers and took out fraudulent loans in their names. In October 2012, a customer of BB&T, D.M., went to the Ooltewah branch of BB&T regarding a loan statement that he received in the mail. D.M. advised back in May 2012, he had been contacted by Brown in regard to a loan which Brown said had been opened for a different "D.M." but had his address in error.
"D.M. was told by Brown that this loan did not have his Social Security number, that he would get one statement, and that it would be corrected on the next statement. D.M. received five statements and faxed a copy of all five to Brown to be corrected. It was determined that two separate loans were made in the Eastern District of Tennessee in D .M.' s name one on May 1, 2012, for $50,000, as charged in the information, and one on August 30, 2012, for $45,000.
"Brown was the loan officer on both loans. Both signatures on the loans were not consistent with D.M.'s signature. After visually observing the signatures and loan application, D.M. confirmed that the signatures were not his. Further inquiries into loans made by Brown yielded three other loans that were questionable using two different names of other customers of the bank.
"Two loans were made by Brown in the name of R.M., one dated February 25, 2010, in the amount of $100,000 and one dated September 3, 2010, in the amount of $230,000. One loan was made by Brown in the name of S. L. dated December 14, 2011, in the amount of $50,000.
"Brown deposited some of the money from the fraudulent loans into a personal account belonging to him and his wife, and used the rest of the money to pay off some of the previous fraudulent loans he made in the customer's names."
Officials said the total exposure to BB&T was $475,000. BB&T prevented $124,000 from leaving the bank. BB&T was able to recover $30,638.90. BB&T incurred a loss of $320,361.10 as a result of the scheme charged, it was stated.
Brown faces up to 30 years in federal prison.
His attorney is Dee Hobbs.
At the time he was hired in 2006, Louis Moore, BB&T Tennessee president, said, “Tracy Brown is exactly the right person to be BB&T’s Chattanooga city executive. He cares deeply about this community and he is a true banking professional.”
Brown, who was 40 at the time, had previously served as a BB&T business services officer in Cleveland, Tn. Prior to that, he was employed at AmSouth Bank for six-and-a-half years.