ASHEVILLE (AP) — A federal judge has ruled that a banker convicted earlier this year of fraud charges related to a failed development must pay $9 million in restitution to his victims, although prosecutors acknowledge he doesn’t have the money to pay.
The Asheville Citizen-Times reported that U.S. District Judge Henry Herlong Jr. decided Wednesday that George Gordon Greenwood must pay the restitution related to fraud in the failed Seven Falls development.
The ruling says Greenwood is liable for nearly $6 million in restitution to the Federal Deposit Insurance Corp. as receiver for Bank of Asheville, which failed last year. It also says Greenwood is responsible for more than $3 million to Queen’s Gap Holding Co. LLC, another victim.
The settlement between Greenwood and the government calls for him to begin making payments of $5,000 a month immediately. Defense attorney Joe Cheshire told the court that when Greenwood is released from prison, his only income will be $1,900 a month in Social Security.
Greenwood is serving his four-year sentence on fraud charges in Edgefield, S.C., and did not appear at the hearing. He was sentenced in May after pleading guilty in June 2011 to bank fraud and money laundering.
Prosecutors filed a court brief saying Greenwood, 66, was involved in illegal loans of nearly $6.8 million with Keith Vinson and his failed Seven Falls development. Vinson has pleaded not guilty to charges of wire fraud, misapplication of bank funds, money laundering and conspiracy to commit money laundering. Four others also face charges, and three more have pleaded guilty in the case.
The court found that Greenwood did not personally receive any of the money, and the judge said he considered that in his sentencing.
Seven Falls was supposed to be an upscale development with 900 homes and an Arnold Palmer-designed golf course on 1,400 acres. It filed for bankruptcy in 2009.