CHICAGO (CN) – A Chicago investment adviser was charged with obtaining $3.2 million worth of loans from a bank, purportedly on behalf of his clients, which he used to make his mortgage payments.
Robert Lunn, age 62, was charged with five counts of bank fraud. The government alleged that he fraudulently obtained a $1.32 million line of credit from Leaders Bank, a bank in Oak Brook, Ill., and separate loans of $1.4 million and $500,000 on behalf of two clients.
“Defendant Lunn fraudulently obtained approximately $3,220,000 from Leaders Bank based on a series of misrepresentations to Leaders Bank about his own assets, the purpose of such financing, and the knowing authorization of clients purportedly seeking the financing,” the indictment said.
“Lunn misappropriated the loan funds for his own use by, among other actions, using the funds to make mortgage payments for a property held by defendant Lunn,” it continued.
In 2001, Lunn was granted the first loan after he falsely told Leader’s Bank that he “owned certain stock, namely, 150,000 shares of Morgan Stanley with a market value of $11,500,000, and 65,000 shares of Lehman Brothers with a market value of $5,500,000.”
The next year, he arranged for an unsecured loan of $1.4 million after submitting a net worth report for Client A. The indictment said, “Defendant Lunn falsely represented to Leaders Bank that the $1,400,000 in loan proceeds would be used for Lunn Client A’s benefit to purchase an interest in an airplane.”
In 2004, he used the same method to obtain a $500,000 loan “purportedly for the benefit of Lunn Client B without Lunn Client B’s knowledge, authorization, or consent. Defendant Lunn forged Lunn Client B’s signature on this application,”according to the indictment.
Lunn faces a maximum sentence of 30 years in prison for each count of bank fraud and forfeiture of at least $2.7 million.
The government is represented by Assistant U.S. Attorney Daniel Collins.