The U.S. Attorney’s for Delaware has agreed that shorter sentences four former Wilmington Trust are warranted.
DelawareOnline reportedthat life sentences were possible in the case that involved hiding bad loans from regulators and shareholders. However, the prosecution agreed to the shorter sentences.
A federal jury found defendants Robert Harra, David Gibson, William North and Kevyn Rakowski guilty and rejected claims they acted lawfully in handling the loans. Harra is the former president of the bank.
Sentencing is slated for December.
Following the disclosure of the bad loans, Wilmington Trust was acquired by M&T for about $300 million, a fraction of its former market value. The merger resulted in the loss of hundreds of jobs as operations were combined and costs were cut.
M&T has maintained Wilmington Trust’s status as the state’s largest brick and mortar bank and kept most branch offices open. Prior to the criminal trial, M&T settled with prosecutors and paid a settlement. It had been named in the criminal complaint.
“We have closely examined the defendants’ conduct in this case, as well as the sentences imposed on individuals convicted of similar crimes across the country. We believe that using the defendants’ compensation to establish the sentencing guideline range is appropriate,” stated Delaware U.S. District Attorney David Weiss.
The mystery in the case is status of former CEO Ted Cecala. Cecala has never faced civil or criminal actions following the demise of Wilmington Trust.
M&T did retain the Wilmington Trust name for its trust operations. (See earlier story below).