Tennessee man pleads guilty to conspiracy to defraud a Dalton bank

Rome, GA (WDEF) – The Department of Justice says Grady Wayne Fricks plead guilty to conspiracy charges from a scheme to defraud Cornerstone Community Bank in Dalton.

Officials say Fricks used a bank insider connection to get a fraudulently inflated loan.

Officials say Fricks contacted a senior vice president that he’d done business with for years and had even loaned his condominium at a Florida beach to.

Fricks asked the senior vice president for a $850,000 loan to purchase property in Ringgold, but he had already signed a contract to purchase the property for only $425,000. 

Acting U.S. Attorney John Horn says, “Fricks’ ability to manipulate people to further his scheme left the bank and its stockholders shouldering the loss.”

Officials say the senior vice president violated Cornerstone’s policies and procedures by not obtaining a copy of the sales contract to verify the price.

The senior vice president also allowed Fricks to select an appraiser, who he paid to inflate the price.

Officials say Fricks also had the real estate closing agent create two HUD-1 settlement statements to get money back at closing, plus he forged or caused someone else to forge the seller’s signature on the fraudulent one.

Officials say Fricks borrowed more money against the property two years later, again paying off the same appraiser to inflate the price.

Fricks did not repay the loans and the bank foreclosed on the property.

The 65-year-old plead guilty in court and will be sentenced on August 14th.

Categories: Crime, Local News, Whitfield County

Leave a Reply

Your email address will not be published. Required fields are marked *