A 38-year-old Sherman, Texas man has pleaded guilty to federal violations in the Eastern District of Texas, announced U.S. Attorney Joseph D. Brown today.
Michael Shelley pleaded guilty to bank fraud Wednesday before U.S. Magistrate Judge Kimberly C. Priest Johnson.
According to information presented in court, from about May 2016 to June 2017, Shelley was employed as a licensed loan officer for Lone Star Agricultural Credit Association in Sherman. During this time, Shelley devised and executed a scheme to defraud Lone Star by creating fraudulent loans for millions of dollars. As part of the scheme, he created fraudulent documents and offered loans, without Lone Star’s knowledge or authorization, at negative and below-market interest rates and terms. Shelley’s scheme extended to 17 fraudulent loans involving nine fictitious persons, and nine other fraudulent loans and unauthorized transfers between existing Lone Star customers involving a total of $8,622,707 in Lone Star Funds.
Under federal statutes, Shelley faces up to 30 years in federal prison at sentencing. The maximum statutory sentence prescribed by Congress is provided here for information purposes, as the sentencing will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the U.S. Probation Office.
This case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant U.S. Attorney Christopher A. Eason.