United States v. Ballard, No. 17-2640 (7th Cir. 2018)Annotate this Case
Ballard obtained a $280,000 loan from SBH to construct the Stone Fence residence, then requested another $90,000 to finish the property. There was insufficient equity to cover that amount; SBH lent him $20,000. Ballard obtained construction loans on properties in Bradley. Grant was the SBH loan officer for all three properties. Ballard submitted required Sworn Contractor’s Statements and Owner’s Payment Authorizations to the Kankakee County Title Company (KCTC), identifying the material and labor costs supposedly associated with his work on the Bradley properties. Ballard obtained $188,000 for the Bradley properties, where no work was performed. Ballard used the funds to complete Stone Fence. An SBH employee discovered Ballard’s scheme. Ballard was charged with three counts of bank fraud, 18 U.S.C. 1344. At trial, Ballard admitted that he had misdirected funds; he argued a “good faith” defense that Grant and his supervisors knew and authorized Ballard’s acts and pressured him to complete Stone Fence. Ballard also claimed he did not read or sign the loan documents, implying that someone forged his signature. After Ballard was convicted, his attorney obtained a previously undisclosed audio recording of Grant, made during a prior, unrelated criminal investigation. The Seventh Circuit affirmed the district court in granting a new trial, finding the recording material.