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Former Louisiana Governor’s Father, Brother Indicted for Bank Fraud

July 24, 1992

SHREVEPORT, La. (AP) _ The father and brother of former Gov. Buddy Roemer were charged with lying to a savings and loan to obtain a $9.6 million loan in an allegedly fraudulent real estate deal.

The name of the former governor never came up during the investigation, first Assistant U.S. Attorney William J. Flanagan said Thursday.

Roemer, a conservative Democrat-turned-Republican, was elected in 1988 and served one term. He failed to make the gubernatorial runoff in October.

The indictment, announced Thursday, names his father, Charles E. Roemer II; brother, Franklin Danny Roemer; and Benton real estate developer R. Lee Harvill.

A fourth man, Houston developer Duncan Ragsdale, pleaded guilty Tuesday to one count of conspiracy to commit fraud and will testify against the others, Flanagan said.

The Roemers’ lawyers said they were confident their clients would be acquitted. Harvill said he was innocent.

The indictment accuses the three of conspiracy and bank fraud. Each could be imprisoned for five years and fined $250,000 if convicted on both counts.

The indictment alleges the three men conspired to defraud the now-defunct Liberty Federal Savings and Loan of Leesville through a $9.6 million loan for the purchase and development of a 92-acre tract of land in Shreveport.

Prosecutors described the alleged scheme as a ″land flip″ in which the property was purchased but construction funds were diverted to the defendants’ personal use.

The property was to have been developed as a shopping center. The loan, made in 1985, was eventually defaulted on, and the thrift was seized by government regulators in 1987, Flanagan said.

The three men made $600,000 on the deal, including a $220,000 home that the younger Roemer built for himself in Benton through profits from the alleged scheme, Flanagan said.

The elder Roemer, who was commissioner of administration under Gov. Edwin Edwards from 1972 to 1980, served 15 months on his conviction of conspiring with reputed crime boss Carlos Marcello to sell influence in gaining state insurance contracts.

Roemer’s and Marcello’s convictions were overturned by a U.S. Supreme Court ruling that limited the government’s use of federal mail fraud statutes.

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