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Walnut Ridge Three Scheduled for Sentencing on Bank Fraud

2 min read

These things can sometimes change at the last minute, but at press time the Walnut Ridge Three were scheduled to be sentenced in federal court in Little Rock later this week.

We refer, of course, to the former employees of First National Bank of Lawrence County who have already pleaded guilty to conspiracy to commit bank fraud by stealing nearly $4 million in cash from the bank’s vault over a 10-year period.

Brenda Montgomery, who was 57 when she waived indictment and pleaded guilty in May, will be sentenced by U.S. District Judge Kristine G. Baker at 10 a.m. on Thursday.

Cindy Tate, also 57 as of May, will be sentenced by Baker at 10:45 a.m. on Friday, followed by Peggy Sutton, 61 as of May, at 1:30 p.m.

Each defendant agreed to be responsible for almost $1.32 million in restitution, for a total of almost $3.95 million.

Their plea deals suggest a sentencing range of 41 to 57 months in federal prison, and the women reserved the right to withdraw their pleas if Baker doesn’t agree to that range.

First National revealed the theft of almost $4 million in August 2015, when it filed its second-quarter call report with the Federal Deposit Insurance Corp. Federal prosecutors said the theft began in 2005.

Tate, the head cashier, had advance notice of internal audits, prosecutors said, and would arrange with tellers Montgomery and Sutton to transfer cash from other branches into the main vault temporarily so the amount of cash on hand would appear to be correct.

Once the auditors completed their count, the defendants would return the cash to the other locations.

Managers became suspicious in April 2015 and arranged for a surprise cash count of the vault contents. A forensic audit confirmed the theft.

In February, the bank’s CEO, Milton Smith, reported that the bank had received an insurance settlement of almost $2.7 million.

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