Former MI bank employee who admitted conspiring to commit bank and wire fraud barred by OCC

A former Michigan bank loan officer who reportedly earned more than $2.5 million in commissions through the origination of fraudulent loans is barred from any future work in a federally insured financial institution, the national bank regulator said in an enforcement order released this week.

Hao Liang “Frank” Hu, who formerly worked for Sterling Bank and Trust, FSB, Southfield, Mich., last April pleaded guilty in the U.S. District for the Central District of California to a federal charge of conspiracy to commit bank fraud and wire fraud, according to a December enforcement action announced Thursday by the Office of the Comptroller of the Currency (OCC).

The OCC said Hu signed a plea agreement that stated he engaged in a widespread conspiracy to engage in a sophisticated bank and wire fraud scheme centering on the Bank’s Advantage Loan Program. That agreement, the agency said, states that Hu between “at least” about 2015 and 2019, when he was a bank employee or officer, “(a) falsified Form 1003s [Uniform Residential Loan Applications]; (b) created false and fictitious supporting documents, including verification of employment letters, gift letters, face-to-face interview narratives, and letters of explanation; and (c) falsified borrowers’ income and debt-to-income ratios in order to make it appear that borrowers qualified for residential loans.”

The OCC said that according to the plea agreement, Hu earned approximately $2,519,488.98 in commissions primarily earned through the origination of the fraudulent loans. It said Hu agreed to forfeit all right, title, and interest in and to all “monies, properties, and/or assets of any kind, derived from or acquired as a result of, or used to facilitate the commission of, the illegal activity to which defendant is pleading guilty.”

The OCC also released an additional two prohibition orders and a termination of enforcement action via Thursday’s release.

OCC Enforcement Actions and Terminations

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