Facing a maximum 30-year prison sentence and a $1 million fine, an Alaska real estate developer recently pleaded guilty to make false statements to Denali Alaskan Federal Credit Union to obtain a $9.4 million loan to build an apartment complex.
According to the U.S. Attorney's Office, Lee E. Baker Jr., owner and president of Discovery Construction Inc., was approved for the loan in 2005 by the $484 million Denali Alaskan in Anchorage, Alaska to build an 85-unit apartment complex.
Baker misled the credit union by providing documents that contained supposed descriptions of the work done on the complex and dollar amounts expended. According to the plea agreement, Baker misrepresented the status of the construction in the draw requests because the work certified was not completed as indicated.
Baker was required to submit certified reports on the project's progress and expenses before he was able to withdraw funds from the loan.
The apartment complex was never completed and Baker, who had already received $4.3 million from Denali Alaskan, defaulted on the loan.
Baker now faces up to 30 years in prison, a $1 million fine or both, according to the prosecutors.
Credit Union Times first reported on Baker's indictment in January.
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