Jack Poulsen, the former president of the failed Ericson State Bank in Nebraska was sentenced to 18 months in prison for bank fraud involving loans to a relative that led to the rural bank’s collapse, according to the U.S. Attorney’s Office for the district of Nebraska.
Poulsen, 71 , was sentenced to bank fraud last week by Judge Susan M. Bazis. He pleaded guilty in May to manipulating data on loans to a relative and business-related entities, and concealing information from the bank’s board.
Poulsen began interfering with loans to a relative in 2015 by advancing bank funds above the approved loan amounts and changing payment due dates and loan maturity dates in the bank’s computer system to conceal the loans’ past-due status from the bank’s board, the U.S. Attorney’s Office said.
“The people of Nebraska expect their monies to be safe when they choose to place their trust in local banks,” U.S. Attorney Susan T. Lehr said in an Aug. 1 press release announcing Poulsen’s sentencing. “No bank officials should be permitted to abuse that trust for the sake of their and their family’s personal gain.”
Poulsen was president of Ericson State Bank from 2010 to 2019, when he was removed from his job after an exam by the Nebraska Department of Banking and Finance revealed that the bank’s condition had significantly deteriorated. The state banking agency found that Poulsen made multiple advances to a relative and charged off a portion of the borrowings without completing the appropriate paperwork or seeking approval from the board or loan committee. In a report, the state banking agency attributed the bank’s deteriorating financial condition to the bank “being operated without regard for laws, regulations, prudent banking policies, and practices.”
The state-chartered bank had $110.9 million in assets but failed in 2020 due to large commercial loan losses and poor management practices. Farmers and Merchants Bank of Milford, Neb., agreed to assume all of Ericson’s $95.2 million in deposits.