Thomas Winkle, a former Paulding, Ohio, car dealer, committed a check-kiting scheme that unwittingly exposed a much bigger, unrelated theft by a small-town banker about 10 miles away.
The banker ended up going to federal prison, and now Winkle may be joining him.
Winkle, 51, of Paulding, was convicted this week of conspiracy to commit bank fraud and bank fraud after a three-day trial in U.S. District Court in Toledo.
Co-defendant Steven L. Myers, 42, a former car dealer from Kenton, Ohio, pleaded guilty in December and is awaiting sentencing.
The scheme commonly involves bank customers writing checks to each other and quickly withdrawing the money before the checks can clear. Done repeatedly, it can confuse bankers and artificially inflate the true value of each customer's account.
The defendants, through their car dealerships in Paulding and Kenton, wrote about $285 million worth of checks to each other in 2001 between accounts in Liberty National Bank and Durez Credit Union Inc., both in Kenton, and the former Oakwood Deposit Bank Co. in Oakwood, Ohio, according to the FBI.
It was the Oakwood bank that particularly drew the interest of FBI agents. When questioned about the bank's losses in the check-kiting scheme, the bank's longtime, bespectacled chief executive officer, Mark Steven Miller, gave confusing answers and eventually admitted embezzling $49 million in an unrelated fraud that nearly shuttered the 97-year-old bank.
FBI and Federal Deposit Insurance Corp. investigators later determined the check-kiting scheme cost the Oakwood bank more than $11 million.
Miller is serving 14 years in prison after pleading guilty last year.
After the conviction Thursday, Judge John Potter ordered a pre-sentence report on Winkle before the judge sets a sentencing date on convictions that carry a maximum 35-year prison term.
That presentence report, using federal sentencing guidelines, will take into account factors about Winkle and the crime to provide the judge a range of sentencing lengths from which to choose.
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