TOPEKA, Kan. (WIBW) - The former chief financial officer of a now-defunct building supply company faces federal charges.
52-year-old John Duncan was indicted Wednesday on one count each of bank fraud and money laundering.
The indictment alleges that Duncan provided false information to University National Bank in Lawrence to get a $15.2 million construction loan for an apartment project by Blue Jay Properties, of which he was also a member. The company was formed to develop Quinton Pointe Apartments in Junction City.
Duncan was CFO of Schmidt Builders at the time. Prosecutors say he falsely claimed all the lumber for the project was paid in full and was being held at Schmidts, and that the lumber could be used as collateral for the loan. Prosecutors say Duncan made a wire transfer of the money he received through the bank loan.
Schmidt Builders closed in 201, citing the tough housing market. The company was founded by Duncan's father-in-law.
If convicted, Duncan faces up to 40 years in prison and a $1 million fine.