Dave Kolpack, Associated Press, Published April 11 2013
Prosecutors, lawyer argue over bank fraud sentenceFARGO — The lawyer for a former North Dakota bank executive convicted of bilking nearly $1 million from her clients was sparring with prosecutors about financial penalties ahead of her sentencing Friday.
Betty Kolling, 67, a former trust officer at Bank of the West in Dickinson, pleaded guilty last year to conspiring to commit bank fraud, after investigators said she stole nearly $800,000 from the trust accounts of five clients over seven years. Prosecutors said new evidence in a pre-sentence investigation shows that losses to victims were closer to $1 million.
Defense attorney Irv Nodland argued in court documents that the government has failed to honor the plea agreement. He said the deal calls for Kolling to pay $790,000 in restitution to cover the victims' losses, and that she shouldn't be required to surrender other potential assets as forfeiture. Prosecutors want Kolling to pay both restitution and forfeiture.
"Now the government has reneged and its sentencing brief makes it clear its promises mean nothing," Nodland wrote in the documents, filed Tuesday. "Its calloused response is, if Betty does not like it, she can request permission to withdraw her plea and go to trial."
Assistant U.S. Attorney Nick Chase, in an earlier sentencing document, said prosecutors did not agree to dismiss the forfeiture penalty and said any sentence that doesn't include both restitution and forfeiture would be illegal.
Kolling's husband, Walter, also is charged with conspiracy to commit bank fraud, mainly for his role in helping the couple obtain a woman's potentially lucrative mineral rights for a nominal fee. He also has pleaded guilty and is set for sentencing Friday.
Prosecutors believe both Kollings should serve prison time, saying the case was different from typical white-collar crimes where defendants have some sort of addiction or spending compulsion and become financially stressed.
"The Kollings were financially comfortable, if not well off, and were not suffering from any substance or gambling addictions," Chase said. "Instead, the Kollings' illegal conduct was driven purely by greed and a twisted belief as to what they were entitled."
In addition to the restitution penalty, Nodland is recommending that Betty Kolling be sentenced to home confinement and ordered to pay back unspecified profits from the mineral rights. He cited his client's cooperation with investigators and acceptance of responsibility for her actions.
"She has great fear of what will happen to her if she is placed in prison," Nodland said.
Nodland said Kolling is an intelligent but "unbelievably naive" woman who was "severely manipulated" by family members, especially her sister, Ann Loran. All the stolen money went to Loran, while his client "never received a penny of it," the lawyer said.
Loran, in turn, used the cash to buy cars, motorcycles, camper, boat and down payments for homes for her great nephew, Michael, whom he said was abandoned by his mother and raised by Loran.
"It is obvious Ann and Michael took tremendous advantage of her willingness to put herself at risk for them," Nodland said of Betty Kolling.
Loran pleaded guilty to conspiracy to commit bank fraud and has been ordered to pay joint restitution along with the Kolllings.
Copyright 2013 The Associated Press.