Federal prosecutors have charged a Baltimore-area developer with bank embezzlement tied to his alleged theft of $534,207 from four real estate limited partnerships linked to the failed First Federal Savings Bank of Annapolis.
Defendant John W. Shilling Jr., of Reisterstown, was charged in a one-count criminal information document filed yesterday in U.S. District Court in Baltimore.
The filing of a criminal information, rather than a formal indictment, usually means a defendant has waived indictment and has agreed to plead guilty to the charges it contains.
According to the charging document, Shilling, owner of Crown Development Corp. in Lutherville, embezzled the money in 1989 and 1990 while his firm was a general partner in four limited partnerships with Delta Financial Inc., a First Federal subsidiary.
Delta obtained the money through loans from the bank, the document said.
The limited partnerships were formed to acquire land and develop real estate projects in Baltimore County for the Helmsley Court, Shepherds Glen, Woodholme Green I and Woodholme Green II Limited Partnerships.
Assistant U.S. Attorney Dale P. Kelberman, a fraud prosecutor, said Shilling, in effect, was in partnership with the bank in the development projects. As general partner, Shilling controlled the limited partnerships' checkbooks.
The prosecutor alleged that Shilling funneled the stolen money into "other business interests, including paying salaries to himself."
The criminal charge grew from an FBI investigation prompted by information turned over to federal authorities last year by the bank and regulatory agencies about the time that the Office of Thrift Supervision took over ailing First Federal. The bank has been operated since then by Resolution Trust Corp., the federal agency that liquidates or sells failed thrifts.
Prosecutors in Baltimore filed other criminal charges two weeks ago against a former officer of Augusta Federal Savings Bank and 10 other people in connection with that institution's failure, and on Monday began the trial of two former officials of Community Savings and Loan on charges tied to that thrift's collapse in 1985.
U.S. Attorney Richard D. Bennett said yesterday that his office is firmly committed to prosecuting "those who threaten the health of Maryland's financial institution."