Former First NBC exec pleads guilty to conspiracy charge

A former executive at First NBC Bank has admitted to his role in a conspiracy to defraud the New Orleans bank prior to its April 2017 failure. 

The U.S. Attorney’s Office for the Eastern District of Louisiana said in a press release Tuesday that Robert Calloway, who had been an executive vice president, pleaded guilty to one count of conspiracy to commit bank fraud. He faces up to five years in prison, three years of supervised release and a fine of up to $250,000 or the greater of twice his gain or twice the loss to any victim.

Calloway’s sentencing was set for March 16. Calloway, along with former First NBC founder and CEO Ashton Ryan and Chief Credit Officer William Burnell, were accused in July 2020 of working with borrowers from 2006 to 2017 to defraud the bank.

The government alleged that the executives, along with others, sought to conceal the financial condition of borrower Gary Gibbs from the bank’s board. The officers allegedly made false statements in loan documents and hid that the borrower was paying off old loans with new ones. 

Gibbs pleaded guilty in August 2020. Ryan and Burnell, along with former First NBC officer Fred Beebe and borrower Frank Adolph, are scheduled for trial in January. 

The case is being investigated by the FBI; Federal Deposit Insurance Corp., the Federal Reserve and the Consumer Financial Protection Bureau. 

When First NBC failed, the borrowers collectively owed $260 million. 

The bank’s failure cost the FDIC's Deposit Insurance Fund roughly $1 billion. Hancock Whitney in New Orleans assumed the bank's deposits and bought about $1 billion of its loans.