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FORMER BANK EXECUTIVE AND SONS CHARGED IN RANDOLPH COOPERATIVE BANK FRAUD

 FORMER BANK EXECUTIVE AND SONS CHARGED
 IN RANDOLPH COOPERATIVE BANK FRAUD
 BOSTON, Oct. 22 /PRNewswire/ -- A. John Pappalardo, U.S. Attorney for the District of Massachusetts, and Margaret R. Hinkle, Director, New England Bank Fraud Task Force, announced today that a federal grand jury returned an indictment yesterday charging Edward C. Hoeg and his two sons, Brian F. and Bruce E. Hoeg, all of Lakeville, Mass., with conspiracy and with the execution of two separate schemes to defraud the former Randolph Cooperative Bank between 1984 and 1988.
 In addition, the indictment charges Edward C. Hoeg, the former chief executive officer of the Randolph Cooperative Bank, with making a series of false entries on the books of the bank in connection with the fraudulent schemes. The Randolph Cooperative Bank was closed by federal and state regulatory authorities in July 1989.
 The indictment alleges that Edward C. Hoeg, 61, in connection with the conspiracy, approved a series of business and personal loans totaling more than $1,500,000 to the Hoeg Realty Trust, a development business operated by his two sons, Brian and Bruce Hoeg, both 36. The indictment further charges that the younger Hoegs diverted a portion of the proceeds of these loans to their own personal use and that Edward C. Hoeg failed to disclose the subsequent nonpayment of the loans to the bank.
 The indictment also charges that in 1987 and 1988, Edward Hoeg released three house lots given as collateral to the Randolph Cooperative Bank by the Hoeg Realty Trust, while falsely reporting that the bank had e?ived payment for the property. Edward Hoeg allegedly built a home on one of the released lots, and his daughter purchased another of the lots from the Hoeg Realty Trust for her personal residence.
 If convicted, Edward C. Hoeg faces a maximum penalty of 30 years' imprisonment and a fine of $1,500,000. Brian Hoeg and Bruce Hoeg each face a maximum penalty of 15 years' imprisonment and a maximum fine of $750,000.
 The case is being prosecuted by Department of Justice attorney Mark J. MacDougall, who is assigned to the New England Bank Fraud Task Force. The Task Force was established in 1991 as part of the Justice Department's ongoing campaign to combat fraud against federally insured financial institutions. Members of the Task Force include the Offices of the United States Attorneys for each of the six New England states, the Fraud Section of the Criminal Division of the Department of Justice, the Department's Civil and Tax Divisions, the Federal Bureau of Investigation, the Internal Revenue Service and the Secret Service.
 -0- 10/22/92
 /CONTACT: U.S. Attorney's press office, 617-223-9445/ CO: ST: Massachusetts IN: SU:


CN -- NE015 -- 3896 10/22/92 17:49 EDT
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Publication:PR Newswire
Date:Oct 22, 1992
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