Former National Century Financial Enterprises Director of Compliance Brian J. Stucke recently pleaded guilty to criminal conspiracy fraud charges filed by the U.S. Attorney's Office for the District Court for the Southern District of Ohio, under a plea agreement. Last week, the Securities and Exchange Commission filed a civil injunctive action against Stucke as well. Stucke is the second former NCFE staffer to enter a plea with the U.S. Attorney's Office and the second to be charged by the SEC. The first was Sherry L. Gibson, Stucke's former supervisor.

Currently, there are at least five additional unnamed co-conspirators under investigation by the U.S. Attorney's Office and the SEC. Stucke is charged with orchestrating the transfer of $36 million from NPF XII to NPF VI on Oct. 28, 1999 to meet the trust non-default compliance requirement of NPF VI, only to wire the same funds back to NPF XII on Oct. 29, 1999, to meet the compliance requirements of the second trust.

In a confidential memo sent to Gibson and copied to the five co-conspirators, Stucke wrote, "This option is probably the best one, although there is a concern that the Trustee(s) will question such a large amount of cash leaving/coming in to the portfolio(s)."

Under the terms of his plea agreement with the U.S. Attorney's Office, Stucke would receive a recommended sentence of a maximum of five years in prison and three years probation, in addition to a $250,000 fine. The agreement stipulates that if Stucke cooperates with authorities and provides assistance in the continuing investigation, the U.S. attorney may move the Court for an appropriate departure from the guideline range for Stucke's sentence. In the plea agreement, Stucke pledges to testify truthfully "in regards to the conspiracy in which he may have been involved or as to which he may have knowledge."

Subscribe Now

Access to a full range of industry content, analysis and expert commentary.

30-Day Free Trial

No credit card required. Access coverage of the securitization marketplace, including breaking news updated throughout the day.