Defendants agree to plea deal in North Dakota fraud caseFARGO, N.D. (AP) — A former North Dakota bank vice president and her husband have signed plea agreements in a scheme to bilk hundreds of thousands of dollars from trust accounts, her lawyer said.
By: DAVE KOLPACK, Associated Press
FARGO, N.D. (AP) — A former North Dakota bank vice president and her husband have signed plea agreements in a scheme to bilk hundreds of thousands of dollars from trust accounts, her lawyer said.
Court documents accuse Elizabeth Kolling of defrauding Bank of the West customers out of nearly $800,000 while she was working as a trust officer. Kolling and her husband, Walter, are facing federal charges of conspiracy to commit bank fraud. They have yet to appear in court.
Investigators say one victim, Betty Reichert, received assistance from Stark County Social Services for the last three years of her life after her trust account was depleted in 2005. Elizabeth Kolling acted as Reichert's attorney and bought Reichert's mineral rights for $1.764.50, which resulted in more than $50,000 in royalties from oil companies within eight months, court documents show.
A separate civil suit in state court against Elizabeth Kolling and Bank of the West says Reichert planned to give her money to Dickinson State University and was "distraught and inconsolable" when she learned she was receiving Medicaid.
"This caused or contributed materially to mental health problems and upset her to the point of being unable to eat, which led to physical health problems," the civil lawsuit said. Reichert died on Oct. 19, 2008.
The government said the largest account in the scheme belonged to Mildred Polensky. Court documents show that Elizabeth Kolling attempted to withdraw nearly $683,000 from the Polensky trust, and obtained all but about $100,000. Most of the money was funneled to Kolling's sister, documents show.
A relative of Polensky reportedly contacted the bank in June 2008 to report problems with the account.
Bank of the West said in state court documents that it cannot be held liable for any acts of fraud by Kolling. The plea agreement in the criminal case calls for Bank of the West to be paid back $790,893.
The fraud dates back to 2001 when Elizabeth Kolling withdrew $775 from Frieda Buehner's trust account, documents show.
Tom Dickson, Walter Kolling's attorney, called it "a very unfortunate situation," but had no further comment.
Irv Nodland, Elizabeth Kolling's lawyer, did not return phone messages left by the Associated Press.
Paul Ebeltoft, the lawyer for Reichert's estate in the state case, and federal prosecutors declined comment.
The federal charge carries a maximum penalty of 30 years in prison.
Copyright 2012 The Associated Press.