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Youngstown Businessman Pleads Not Guilty to Bank Fraud
"CLEVELAND -- Youngstown businessman Jeffrey J. Moffie Wednesday pleaded not guilty to federal charges that he and an associate defrauded Bank One of more than $1.4 million.Moffie and Dale M. Delgado were arraigned at U.S. District Court here on four criminal counts related to conspiracy to commit bank fraud and bank fraud. Both entered pleas of not guilty and bond was set at $100,000 by Magistrate Judge Nancy A Vecchiarelli.Moffie filed for personal bankruptcy last year as well as in 1989. Among his realestate interests in downtown Youngstown are the Stambaugh Building anda parking garage on Champion Street. A federal grand jury handed up an indictment Nov. 17, alleging Moffie and Delgado misrepresented collateral in order to leverage loans for clients they served as part of a company they created in 1994 called WWM Inc.According to the indictment, the company's purpose was to assist customers in obtaining business loans from financial institutions. The government alleges Moffie, with the assistance of Delgado and another man, Gary D. Cerasi, devised a plan to assist clients in obtaining loans through what he termed a "leveraged asset program."The indictment charges the defendents ran the program by obtaining treasury bonds and low-risk securities for clients. The stocks were then used as collateral to leverage loans for these clients. The loans were administered through Bank One in Columbus. The government charges the defendants purchased the securities on margin -- in this case they only paid 10% of the total sale price for the stocks and thus did not actually own the stock. The balance of the purchase price remained owed to the securities dealer.The indictment alleges the defendants deceived Bank One by making it appear on financial statements that their clients owned the stocks free and clear and that another company operated by Moffie, Cambridge Investment Group Inc., held the securities. The government also said Moffie never disclosed to Bank One the securities were purchased on margin and made it appear the full market value was available to the bank in the form of collateral.According to the government, between Jan. 20, 1994 and Nov. 7 1994, the defendants helped five clients obtain loans from Bank One, using the leveraged asset program, that totaled more than $1.8 million. Three of the five loans were paid in full. The other two -- a $680,400 loan to Euclid Avenue Inc. and a $724,500 loan to AIM Inc. -- went into default, causing Bank One to lose more than $1.4 million, the indictment states.Moffie's case has been assigned to U.S. District Judge Peter C. Economus, who presides in the Youngstown federal courthouse."