According to recently filed documents in the U.S. District Court for the Eastern District of Pennsylvania, district judge Paul S. Diamond, Jr. again has granted a postponement of sentencing for three defendants in the Equipment Finance Inc. loan fraud case.

Joseph M. Braas, EFI’s former COO, who was to be sentenced June 9, 2011, is now to be sentenced on November 28, 2011.

The sentencing of Michael J. Schlager, former senior vice president of EFI, was changed from June 15, 2011 to November 30, 2011.

Mary C. Stankiewicz, EFI’s former secretary/treasurer and accounting supervisor, had her sentencing changed from June 10, 2011 to November 29, 2011.

In January Schlager pleaded guilty to one count of conspiracy and two counts of mail fraud. Braas has pleaded guilty to one count of conspiracy and two counts of mail fraud. Stankiewicz has pleaded guilty to one count of conspiracy.

Five additional individuals were indicted and are awaiting trial, which is scheduled for October 25, 2011.

Previously on monitordaily.com:

Sentencing of Third Defendant in EFI Loan Fraud Case Postponed

Sentencing of Second Defendant in EFI Loan Fraud Case Postponed

Sentencing of Key Figure in EFI Loan Fraud Case Postponed

Eight Indicted in $53 Million Sterling Financial Fraud Case
Friday, November 19, 2010

According to a 32-page indictment, filed in the U.S. District Court for the Eastern District of Pennsylvania, a Federal Grand Jury has indicted eight officers and employees of logging industry lender Equipment Finance, LLC, that was based in Lititz, Lancaster county and was a wholly owned subsidiary of Sterling Financial Corporation.

EFI was a logging industry lender that provided financing for the purchase of forestry and land clearing equipment, primarily in the southeastern U.S. According to the indictment, from the time it was acquired by Sterling Financial in March 2002, until April 2007, the value of EFI’s loan portfolio grew on paper from approximately $80 million to approximately $330 million. Sterling was subsequently acquired by PNC Financial in April 2008.

Joseph M. Braas, Michael J. Schlager, Mary C. Stankiewicz, Misty L. Kroesen, Curtis A. Kroesen, all from Lancaster county and John Wiley Spann, Harold W. Young and John S. Tomberlin, all from Alabama were indicted with conspiracy to commit mail fraud and mail fraud, all arising out a massive, sophisticated loan fraud scheme that resulted in a loss of $53 million.

It is alleged in the indictment that as far back as 2001, before EFI was acquired by Sterling, the defendants, which include five former EFI employees, were engaging in a systematic fraud at EFI. From 2001 through 2007, they are charged with colluding in a pervasive scheme to steal money by looting the accounts of EFI and falsifying EFI’s books.

Joseph Braas, EFI’s chief operating officer and Michael Schlager, a senior vice-president, are alleged to have been the leaders of the conspiracy. They directed other employees of the company, including Mary C. Stankiewicz, Misty L. Kroesen and Curtis A. Kroesen to make false entries in EFI’s books, create false documents for EFI’s files, and undermine the audit process conducted by Sterling’s inside and outside auditors. During the years of the conspiracy, the EFI employee defendants made EFI appear more profitable than it actually was and made it appear that EFI was exposed to less risk than it was, and thereby succeeded in keeping their jobs, making increasingly higher salaries and bonuses, and continuing to obtain funding for EFI from Bank of Lancaster County and its other creditors.