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Ex-Morgan Banker Pleads Guilty to Fraud, Tax Evasion

October 10, 1986

NEW YORK (AP) _ A former Morgan Guaranty Trust Co. official has pleaded guilty to federal bank fraud charges stemming from the misappropriation of $4.3 million from Brazilian depositors’ accounts.

Antonio Gebauer, a senior vice president at Morgan from 1981 to 1985, also pleaded guilty on Thursday to tax evasion for not reporting as income more than $3.4 million, a portion of the money received in the bank fraud scheme.

Gebauer, 46, of Manhattan, pleaded guilty before U.S. District Judge Robert Sweet to one count each of bank fraud and income tax evasion and two counts of making false bank statements in a plea agreement with federal prosecutors.

His lawyer, Stanley S. Arkin, noted outside the courtroom that Gebauer had not pleaded guilty to embezzlement but prosecutors claimed that was only a semantic distinction.

″The charges to which he pleaded guilty today are equally serious,″ said Harold Wilson, chief of the Criminal Division for the U.S. attorney’s office in Manhattan. ″It’s nonsense to claim this is a lesser crime.″

As part of the plea bargain, Gebauer read in court a prepared statement in which he admitted causing the unauthorized withdrawals, totaling $4.3 million, from customers’ accounts and said ″I did all of these things knowingly and willfully and with the intention of defrauding Morgan and its officers and employees.″

In accepting Gebauer’s guilty plea, Sweet noted that he faced a maximum total penalty of 20 years in prison and $355,000 in fines as well as payment of $1.7 million in back taxes to the Internal Revenue Service.

Sweet scheduled sentencing for Dec. 11 and released Gebauer on $2 million bond secured by property.

Gebauer admitted that between Feb. 2, 1976, and Aug. 30, 1985, he falsely told Morgan officials he was authorized to make the withdrawals and caused them to issue treasurers checks, drawn on six foreign customer accounts. The checks were not requested by the customers nor were they for the customers’ benefit, according to prosecutors.

Included in the $4.3 million were unauthorized loans totaling $2.9 million, which Gebauer admitted falsely telling Morgan officials the customers had requested.

The accounts, for which statements were not routinely sent unless requested, were in the names of Panamanian holding companies controlled by five Brazilian nationals, said prosecutors.

Gebauer attempted to conceal the fraud scheme by creating false account statements on Morgan letterhead stationery for several Panamanian accounts controlled by one customer, Francisco Catao of Brazil, officials said.

Gebauer pleaded guilty to charges on two false statements sent between May 1980 and July 1985.

Assistant U.S. Attorney Linda Imes said one false statement showed an account had approximately $12,000 when it actually was overdrawn by $150,000. The second phony statement showed $230,000 in an account that really only contained $30,000.

Gebauer also pleaded guilty to not reporting more than $3.4 million on income tax returns between 1977 and 1983.

As part of the plea bargain, he must pay the IRS approximately $1.7 million.

Gebauer’s guilty plea was the culmination of a five-month FBI investigation after Morgan turned over the results of an internal investigation to federal officials.

Gebauer, who left Morgan in August 1985 for the investment banking firm of Drexel, Burnham and Lambert, resigned from that post last May after the Morgan in-house probe became public.

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