On September 28, 2023, United States District Judge Eldon E. Fallon sentenced WILLIAM J. BURNELL, age 73, of Kenner, ROBERT B. “BRAD” CALLOWAY, age 63, of Metairie, and FRANK J. ADOLPH, age 63, of New Orleans, announced U.S. Attorney Duane A. Evans. All three defendants previously pleaded guilty to bank fraud conspiracy for their role in the fraudulent scheme that led to the collapse and failure of New Orleans-based, First NBC Bank (Bank), in April 2017.
BURNELL was sentenced to 48 months in prison, three years of supervised release, and a $100 mandatory special assessment fee. Judge Fallon ordered a restitution hearing to be held at a later date. According to court documents, from 2006 through April 2017, BURNELL was the Bank’s Chief Credit Officer. He was responsible for the overall quality of the Bank’s lending function; the Bank’s credit policies and administration; the Bank’s loan recovery and collection efforts; and the Bank’s monitoring and managing of past due loans, including the approval of the Bank’s internal list of past-due loans. BURNELL was also responsible for compiling month-end reports, including lists of overdrawn borrowers and past-due loans. Nevertheless, BURNELL conspired with Bank President, Ashton J. Ryan, Jr., and others, to conceal material information and defraud the Bank. Among other things, BURNELL fraudulently risk rated loans to past due borrowers so new loans could be issued to them to conceal the borrowers’ past due status from the Board.
CALLOWAY was sentenced to 30 months in prison, two years of supervised release, and a $100 mandatory special assessment fee. Judge Fallon likewise ordered a restitution hearing to be held at a later date. According to court documents, CALLOWAY was the Bank’s Executive Vice President and specialized in tax credits. CALLOWAY and other bank officers, including Ryan and BURNELL, conspired to conceal the financial condition of bank borrower, Gary R. Gibbs, from Bank’s Board of Directors, auditors, and examiners. Among other things, they falsely stated in loan documents that Gibbs was able to pay his loans with cash generated by his businesses. They concealed from the Bank’s Board of Directors, auditors, and examiners that Gibbs was only making his existing loan payments by getting new loans from the Bank.
ADOLPH was sentenced to 20 months in prison, two years of supervised release, and a $100 mandatory special assessment fee. Judge Fallon ordered restitution in the amount of $5,706,279.62. According to court documents, ADOLPH was a borrower at the Bank, both individually and through various companies. One of these companies, Metro Rediscount, was a factoring company that purchased other companies’ accounts receivable. ADOLPH was habitually unable to pay his Bank loans. With Ryan’s knowledge, ADOLPH lied about Metro Rediscount’s assets on loan applications. As a result, Ryan was able to ensure ADOLPH received loans that kept him and his companies off the past due list.
U.S. Attorney Evans said, “These sentences demonstrate our office’s commitment to prosecuting white collar crime. They also show that employees cannot use the defense that they were merely ‘following orders.’ Each citizen has an individual responsibility to follow the law.”
U.S. Attorney Evans praised the work of the agencies that conducted this years-long investigation: the Federal Bureau of Investigation New Orleans Field Office; the Federal Deposit Insurance Corporation, Office of Inspector General, Dallas Regional Office; and the Board of Governors of the Federal Reserve System, Consumer Financial Protection Bureau, Office of Inspector General, Miami Field Office. Assistant U.S. Attorneys Matthew R. Payne and Nicholas D. Moses of the Financial Crimes Unit, J. Ryan McLaren of the Appellate Unit, and Rachal Cassagne of the Narcotics Unit, are in charge of the prosecution.