PRESS RELEASE


Bank President Charged In Commercial Loan Scam

Former First National Bank Board Member Sentenced To Federal Prison For Conspiracy To Commit Bank Fraud

Lubbock, TX -- (October 5, 2007) -— Lubbock resident, Robert Hobgood, 56, was sentenced today by U.S. District Judge Sam R. Cummings to 30 months in prison and ordered to pay $200,000 in restitution, announced U.S. Attorney Richard B. Roper of the Northern District of Texas. Hobgood pled guilty in June to one count of conspiracy to commit bank fraud. Judge Cummings ordered that Hobgood surrender to the Bureau of Prisons on November 9, 2007.

Robert Hobgood was President and Chairman of the Board of Directors at First National Bank (FNB) in Lubbock, Texas. He was also a member of the Board of Directors at FNB and a member of the Board of Directors Loan Committee. Hobgood, along with co-conspirator Kim Morris (Morris) and nominee borrower William Davis Moore (Moore), all took actions to defraud FNB.

Specifically, Hobgood, Morris, and Moore conspired to make fraudulent loans from FNB. On May 4, 1998, Morris purchased the Pioneer Hotel, financing the purchase with a mortgage on the hotel that was held by another financial institution. By the end of 2002, Morris defaulted on the Pioneer Hotel mortgage. In January 2003, Hobgood and Morris agreed that FNB would lend Morris the money to finance the sale of the Pioneer Hotel by creating a sham corporation in Moore’s name and using Moore as a nominee borrower to fraudulently conceal from FNB the true ownership of the Pioneer Hotel. Hobgood and Morris, acting on behalf of FNB, approved and made a fraudulent nominee loan in the amount of $525,000.

Morris was sentenced in August to 18 months in prison and ordered to pay $69,000 in restitution.

U.S. Attorney Roper praised the investigative efforts of the Internal Revenue Service - Criminal Investigation and Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorney Paulina Jacobo of the Lubbock, Texas, U.S. Attorney’s Office.





SOURCE: U.S. Attorney's Office - Northern District of Texas