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Saturday, May 18, 2024 | Back issues
Courthouse News Service Courthouse News Service

Former Bank VP Pleads Guilty to Conspiracy

OAKLAND, Calif. (CN) - Former United Commercial Bank senior vice president Thomas Yu pleaded guilty to federal conspiracy charges Tuesday.

Yu, 51, faces up to five years in prison after pleading guilty to one of six counts: conspiracy to commit false bank entries, reports, and transactions, the U.S. Attorney's Office said.

Yu admitted he prepared "false and misleading quarterly loan loss allowance reports in which the bank calculated the loss reserves it was required to recognize as part of its quarterly financial reporting in the third and fourth quarters of 2008," prosecutors said in a statement.

"By failing to properly downgrade poor performing loans, Yu admitted that he helped the bank avoid required loan loss reserves that enabled the bank to artificially inflate its reported earnings to the public."

The now defunct UCB was a Chinese bank based in San Francisco.

Founded in 1974 as United Federal Savings, a loan association, it became a subsidiary of UCBH Holdings. The bank, which had branches throughout the United States, Taiwan and China, was taken over by the Federal Deposit Insurance Corporation in November 2009 after an investigation by TARP, the Federal Reserve, the Consumer Financial Protection Bureau and the FBI.

The FDIC estimated the bank failure caused $1.1 billion in losses, not counting $297 million in federal dollars provided by the Troubled Asset Relief Program.

Yu also could be fined up to $250,000.

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