Mar 16, 2012 8:56 AM by AP
NEW ORLEANS (AP) - Federal prosecutors say a Covington developer has admitted conspiring to get mortgages for bad loan risks. They say the plot was uncovered during investigation of the federal bank bailout program.
U.S. Attorney Jim Letten says 43-year-old Troy Fouquet pleaded guilty Thursday to one count of conspiracy to commit bank fraud and will be sentenced June 7. He and Reginald Harper, former president and CEO of First Community Bank in Hammond, were charged in February.
Letten says Harper loaned Fouquet more than $2 million to buy land and build subdivisions, with homebuyers' mortgage payments to pay off the loans. He says they had trouble finding qualified buyers, and allegedly used sham loans to avoid reporting Fouquet's delinquency.
Prosecutors say that affected the bank's application to the federal Troubled Asset Relief Program.