Houston Men Plead Guilty Of Defrauding AmSouth Bank

Two Houston, Tex., men charged with defrauding AmSouth Bank of a quarter million dollars via a firm based in Collegedale pleaded guilty in Federal Court on Monday.

Sidney Milton Nathan, 59, and Arthur M. Pellenberg, 58, appeared before Judge Curtis Collier.

They each pleaded guilty to fraud and money laundering. They face up to 30 years on the first count and 20 years on the second.

The indictment says Nathan was president of Recruit America Personnel Services, based in Houston, Tex., and Pellenberg was vice president.

It says Alpha Financial Services was headquartered in Collegedale and was engaged in the business of obtaining money for companies in need of short-term financing. Alpha had a line of credit with AmSouth that at one time exceeded $20 million.

The indictment says in order to obtain money from the bank, Recruit submitted invoices to Alpha for individuals it placed with Recruit's customers. Alpha obtained the funds from AmSouth, and it was supposed to be paid by Recruit within 90 days.

It says the two defendants devised a scheme to defraud AmSouth starting at least as early as May 2000 and continuing until January 2001.

The indictment says the pair submitted false invoices to Alpha for individuals who had allegedly been placed by Recruit. It says they submitted duplicate invoices to Alpha for the same individual who previously had been placed by Recruit and previously invoiced to Alpha.

It says they also submitted fraudulent invoices for individuals who had not been placed with the company.

The indictment says the false invoices totaled more than $250,000 for placements allegedly made by Recruit to companies that included International Trading Company ($116,880), Kerry Inc. ($142,300), and numerous other companies.

What are people saying about mortgages today:

Rates on 30-year mortgages edged down last week to a seven-month low. Mortgage-giant Freddie Mac reported Thursday that 30-year, fixed-rate mortgages fell to 6.3 percent, down slightly from 6.31 percent two weeks ago. It put rates at the lowest level since they were at 6.24 percent the first week of March.

Bank of Hawaii, Central Pacific Bank, Territorial Savings Bank and Wells Fargo Home Mortgages all cut their 30-year mortgage rates to 5.75 percent this week.

Most people think of a mortgage as a means to an end. After all, you buy a house, not a home loan. But a mortgage is much more than the path to homeownership. It is a financial instrument that must be managed, just like any other financial investment.