UPDATE: John Mills Pleads Guilty to Kiting $11.5 Million in Checks

by Arkansas Business Staff  on Thursday, Feb. 18, 2010 3:59 pm  

John Mills of Cabot, who had been fired as CEO of Affiliated Foods Southwest shortly before it went into bankruptcy, waived indictment and pleaded guilty Thursday afternoon to a single count of bank fraud.

The U.S. Attorney's office said Mills, 59, kited $11.5 million worth of checks, although no dollar amount is included in the information, a charge filed by directly by prosecutors as opposed to an indictment issued by a grand jury. Prosecutors said the amount of loss suffered by U.S. Bank is $7.5 million.

The information said Mills "and others known and unknown to the United States Attorney" defrauded U.S. Bank by kiting checks between accounts of Affiliated Foods and two subidiaries. No co-conspirators were named in the information, but a press release by U.S. Attorney Jane Duke said chief financial Alexander Martinez helped Mills devise the scheme.

"Mills acknowledged that on an almost daily basis from September 29, 2008 until February 27, 2009, checks were kited from [Convenience Store Supply Inc.  and Supermarket Investors Inc.] and deposited into AFS' account," according to the release.

Arkansas Business reported in December that Mills had asserted his Fifth Amendment right against self-incrimination in a civil suit related to Affiliated's bankruptcy.



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