BEAVER DAM MAN SENTENCED TO 6 YEARS FOR DEFRAUDING FINANCIAL INSTITUTIONS
– Defendant defrauded the banks in the amount of $8.5 Million

BOWLING GREEN, KY - Shaun Stuart Schneider, age 35, of Beaver Dam, Kentucky, in Ohio County, Kentucky was sentenced on May 19, 2008, to 6 years imprisonment, in United States District Court, Owensboro, Kentucky for 2 counts of bank fraud, United States, U.S. Attorney David L. Huber of the Western District of Kentucky announced today. Joseph H. McKinley, Jr., Judge, United States District Court, also sentenced Schneider to 5 years supervised release following incarceration. There is no parole in the federal judicial system.

Schneider had plead guilty to submitting false documentation to J.P. Morgan Chase Bank and Fifth Third Bank in order to obtain two lines of credit for a total of $10,000,000. In May 2005, Schneider obtained a $7,000,000 line of credit from J.P. Morgan Chase Bank based upon false and fraudulent invoices, contracts, and correspondence created by Schneider to give the impression that his company, Schneider Consulting LLC, located in Beaver Dam, Kentucky, had accounts receivable exceeding $8,000,000. Schneider submitted to the bank a fabricated contract purporting to represent the purchase of computer equipment for the University of Louisville from Schneider's company in the amount of $500 million dollars. Schneider also submitted fraudulent purchase order or invoices purporting to reflect the purchase of equipment by the Louisville Water Company and the Metropolitan Government of Nashville. Schneider represented to the bank that each of the contracts was legitimate.

In December 2005, Schneider began the loan application process to obtain a $3,000,000 line of credit from Fifth Third Bank in Evansville, Indiana. Schneider offered as collateral for the loan an investment account purportedly containing $3.2 million dollars. Schneider inflated the balance in the investment account by depositing a check in the amount of $2.8 million so that the investment account showed a balance of $3.2 million when Fifth Third verified the account on or about December 14, 2005, when, in truth and in fact, the actual balance in the investment account was approximately $400,000, and Schneider Consulting did not have $2.8 million to cover Schneider's check.

The total combined loss on the loans from J.P. Morgan Chase and from Fifth Third Bank was approximately $8.5 million. To date, the United States has seized assets from Schneider and recovered as restitution for the victim banks approximately $1.2 million in real and personal property. Schneider was ordered by the Court to pay restitution to J.P. Morgan Chase and Fifth Third Bank in the amount of $7,472,954.63.

The case is being prosecuted by Assistant United States Attorney Marisa J. Ford, and it was investigated by the Federal Bureau of Investigation in Owensboro, Kentucky.

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