Rockville Man Sentenced To Prison For Bank Fraud, Tax Evasion

ROCKVILLE, MD — A former bank president from Rockville was sentenced to prison for bank fraud and tax evasion on Thursday, Dec. 20, according to federal prosecutors.

David Harris Lavine, 58, was ordered to serve three years in federal prison, followed by two years of supervised release, after he stole $100,000 from a bank while he was president and diverted more than $775,000 from loan borrowers once he resigned. The former CFG Community Bank president was also ordered to forfeit $503,378.87, plus pay $892,541.75 in restitution to the bank and $365,228.80 in restitution to the Internal Revenue Service.

"From March 2010 until January 2011, David Harris Lavine was the acting president of CFG Community Bank. According to his plea agreement, Lavine admitted that, while acting President, he diverted $100,000 of bank funds to his own benefit," the U.S. attorney's office in Maryland said in a statement. "Lavine directed bank employees to wire funds, which Lavine mischaracterized as payments to a mortgage broker on bank loan refinances, to a company that belonged to a friend of Lavine's. Lavine lied to the friend about the source of the funds and had the friend pay the $100,000 over to Lavine."

Shortly after Lavine resigned in 2011, he became president of an affiliate company of the bank called Capital Financial Ventures (CFV). According to court documents, Lavine devised a scheme to defraud CFG: he refinanced two-bank owned mortgage loans and diverted loan payoffs to his personal benefit and the benefit of Charles Tobias, a friend and co-defendant in the case.

In order to divert loan payoffs, Lavine posed as the CEO and president of CFG, prosecutors said.

"For example, Lavine invited the borrowers of two loans with balances totaling over $7.5 million, to refinance those loans with other financial institutions for lower mortgages and pay off CFG Community Bank," the U.S. attorney's office said.

The settlement companies — at Lavine's direction — sent the mortgage loan payoffs to an escrow account managed by Tobias. Lavine was then able to divert more than $775,000, according to the indictment. Lavine created false correspondence with the two loan borrowers to conceal the money he had stolen.

Lavine and Tobias also owned Capital T Partners Brookfield, LLC. In the fall of 2011, the pair sought to "profit from a group of non-performing mortgages their company had purchased by 'donating' some of the mortgages to a charity as an in-kind donation and taking a charitable deduction on their income tax returns," according to the indictment. The tax reduction would pass through to their personal income tax returns.

According to the indictment, Lavine also failed to report his income of more than $176,000 in 2010 — and his income of $480,289.44 from loan fraud proceeds and insurance refunds the year after. Prosecutors said Lavine underpaid his taxes for 2010, 2011, and 2012 by $365,228.80.

On Sept. 26, 2017, Lavine was charged with theft of bank funds by a bank officer and bank fraud, prosecutors said. Tobias, of Potomac, was charged with conspiracy to defraud the Internal Revenue Service and tax evasion.

Tobias was sentenced to two years of probation with eight months of home confinement with electronic monitoring, according to the U.S. attorney's office. He was also ordered to pay $154,438 in restitution to the Internal Revenue Service.

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