Larry Webb, the former deputy director of the Upper Cumberland Development District will be on supervised release for three years and pay a $2,000 fine for bank fraud in the 2013 Living the Dream scandal.
U.S. District Judge Waverly D. Crenshaw, Jr. signed an order accepting and approving a supplemental plea agreement in the case after a sentencing hearing for Webb on Monday, January 9.
Under terms of the agreement, Webb is sentenced to time served (one day) and three years supervised release. His fine is $2,000 and he must pay a criminal monetary penalty of $100. As a special condition of supervision, the defendant is prohibited from owning, carrying or possessing firearms and during his supervised release, the defendant is permitted to travel between the Eastern District of Tennessee and the Middle District of Tennessee for business purposes.
Meanwhile, Wendy Askins, the former UCDD Director reported to federal prison in West Virginia on Monday, January 9th. Federal Prison Camp Alderson, where Askins is housed, is the same place Martha Stewart spent her time in 2004 for her conviction on insider trading.
Webb, who entered a voluntary guilty plea on August 17, 2015 to one count of bank fraud in the “Living the Dream” investigation, was to have been sentenced Thursday, December 8 but that was postponed until January 9.
Under terms of his original plea agreement, Webb was to have avoided paying a fine in the case. However, a court order signed Friday, December 9 by Judge Crenshaw stated that “the court believes a fine in the $6,000 range may be appropriate, considering Defendant (Webb’s) cooperation with the Government, his offense conduct, and ability to pay".
Webb was indicted with Askins in 2013 on various federal bank charges, including conspiracy, theft of government money, bank fraud, money laundering, and making a false statement.
Askins was accused of diverting hundreds of thousands of dollars of agency money into a million-dollar luxury home in rural Putnam County called "Living the Dream". What was intended to become a home for needy seniors also became Askins' home.
Although Webb's attorney Ed Yarbrough said he never profited from the scheme, Webb admitted that he was guilty of Count Eight of the federal indictment, which accused him and Askins of securing a $250,000 loan from the Bank of Putnam County "for their own use and benefit" and "falsely representing" that it was for a project that had been approved by the UCDD board of directors."
Court documents relating to Webb's plea agreement state that, “On February 2, 2010, Webb incorporated “Living the Dream/Independent Living for Seniors, Inc.” While “Living the Dream” had the appearance of being a project approved by the Cumberland Regional Development District, of which Webb was a director, it was in fact owned and operated by Webb and Askins. A portion of the property was intended to be used as an independent living facility, while another portion was used as a luxury home for co-defendant Askins.”
“In order to partially fund the purchase of the “Living the Dream facility, Webb and Askins obtained a loan from the Bank of Putnam County. To obtain this loan, Webb made false statements to loan officers relating to the true nature of “Living the Dream”. Specifically, Webb told the loan officers that “Living the Dream” was an approved UCDD/CRDC project. Additionally, Webb presented false documents, including CRDC resolutions dated May 7, 2010 purportedly authorizing a loan application for “Living the Dream” in the amount of $750,000. As Webb very well knew, the CRDC had not approved the “Living the Dream” project, and had not authorized a $750,000 loan application,” the court documents state.
“In reliance upon these false statements and representations, the Bank of Putnam County on May 27, 2010 approved a loan in the amount of $250,000 for “Living the Dream”. Webb and Askins applied the loan proceeds to the purchase of “Living the Dream”. The bank would not have approved the loan or disbursed funds had it known UCDD and/or CRDC did not approve of the project or the loan application”, the court documents continued
“The bank eventually foreclosed on the property and subsequently recovered all of its loan proceeds”.
Askins entered a plea on August 31 to two counts of theft from a federally-funded entity stemming from the “Living the Dream investigation and was sentenced on October 28 to 18 months in federal prison. The sentence will run concurrently with a state sentence after her plea in Putnam County Criminal Court on October 31 to forgery over $60,000. After her release, Askins will be on supervised probation for two years. She must also pay restitution of $233,000 to the UCDD.