Crime & Safety
Nesconset Man Pleas Guilty to Bank Fraud of More Than $100M
John Murphy, 63, faces a maximum of 30 years in prison.
A Nesconset man pleaded guilty to attempting to take more than $100M from various financial institutions and investors over a roughly five-year period.
John Murphy, 63, pleaded guilty to bank fraud before Judge Gary R. Brown in Central Islip's federal courts on Friday. Murphy faces a maximum sentence of 30 years in prison.
Murphy, formerly the chief executive officer of Oak Rock Financial LLC in Suffolk County, attempted to defraud various financial institutions and Oak Rock investors out of more than $100 million between January 2009 and April 2013, according to prosecutors.
"Murphy abused his position as CEO and defrauded banks out of millions of dollars by lying about his company’s financial health,” said U. S. Attorney Loretta Lynch in a statement. “Today’s conviction should act as warning to executives, if you lie to lenders and investors, you will be investigated and prosecuted to the full extent of the law.”
Murphy formed Oak Rock Financial in 2001 to act as a business that helped other businesses across the country secure lines of credit.
Find out what's happening in Smithtownwith free, real-time updates from Patch.
Murphy admitted in his guilty plea to lying to the Israel Discount Bank, other financial institutions and Oak Rock investors about his company's account receivables, according to court records.
Since January 2009, he had been changing the delinquency dates on loans to keep them current and from falling into default, booking fictitious payments thereby creating fictitious accounts receivable, and re-aging delinquent accounts receivable by copying data from timely paid accounts to make loans appear stable.
"Mr. Murphy, instead of being a steward of Oak Rock Financial, spent his time cooking the books. Let this serve as a reminder to executives everywhere that honesty and integrity are more important than the bottom line,” said FBI Assistant Director-in-Charge Venizelos in a statement.
Find out what's happening in Smithtownwith free, real-time updates from Patch.
Get more local news delivered straight to your inbox. Sign up for free Patch newsletters and alerts.
