A former investment banker from Westchester County was arrested Monday for allegedly aiding the former head of Park Avenue Bank and two others in a scheme to siphon millions of dollars in assets from an Oklahoma insurance company.
Allen Reichman, 52, was arrested at his Irvington home and brought to U.S. District Court in Manhattan to face charges of conspiring to commit wire fraud. He faces up to 20 years in prison if convicted.
In 2008 and 2009, prosecutors charged, Reichman worked closely with Charles Antonucci, the convicted former CEO of Park Avenue Bank, to defraud Oklahoma regulators in a manner that allowed Antonucci to purchase an insurance company there. Antonucci pleaded guilty to fraud in connection with the case two years ago.
Prosecutors said Reichman directed Antonucci to sign a letter that gave false information about collateral Antonucci was using to secure a loan used to purchase Providence P&C, the Oklahoma insurance company.
After Oklahoma regulators were duped into approving the sale, Antonucci and others managed to plunder the company of millions of dollars in assets, prosecutors charged.
Reichman received hundreds of thousands of dollars in commissions as a result of fraudulent transactions engineered by Antonucci and Kentucky businessman Wilber Anthony Huff, according to prosecutors.
In November 2009, the Oklahoma insurance company was declared insolvent after its assets were plundered by Antonucci and others, prosecutors charged.
"We will not tolerate those who steal from taxpayers for their personal gain," said Preet Bharara, the U.S. attorney for the Southern District of New York, who announced the unsealing of a 13-count indictment.
Also arrested Monday was Huff, 51, whom prosecutors accuse of evading $50 million in federal taxes and masterminding financial fraud schemes that netted $100 million.
Matthew Morris, 37, the former senior vice president of Park Avenue, was charged with conspiring to commit bank bribery, bank and insurance fraud and the theft of $2.3 million from a publicly traded company.
"The unifying theme of the charges unsealed today is dishonesty," said Mary Galligan, the FBI's acting assistant director in charge. "As alleged, the defendants conspired to deceive bank regulators, insurance regulators and investors, all with the aim of concealing their self-dealing and the diversion of funds into their own pockets."