SCANDAL IN A SMALL TOWN

June 5, 2002 -- In the village of Oakwood, Ohio (population 742) and other villages of rural Paulding County, everyone knows almost everyone. And almost everyone thought they knew the local banker, Steve Miller. On Feb. 1, 2002, federal investigators uncovered an alleged embezzlement scam that left the Oakwood Deposit Bank insolvent. Tens of millions of dollars were unaccounted for. Steve Miller told the FBI he used his depositors' money to invest -- off the books -- in a company that runs casino boats in Florida and South Carolina. Miller is currently free on bond awaiting trial.

The draining of the bank's funds had gone on for at least a couple of years, and the auditors and bank examiners had all missed it. The bank's local stockholders lost millions. Big depositors lost what wasn't federally insured -- the limit is $100,000. All Things Considered senior host Robert Siegel recently traveled to Oakwood to talk with residents about the impact of the scandal. He heard tales of a rural community rocked by the alleged misdeeds of one of its own.

Oakwood Mayor Bryan Ripke says there's a $370,000 deficit in the village municipal budget -- meaning needed civic repairs will not get done in the near future. Linda Fett, the pastor of the Oakwood United Methodist Church, says her church's losses may delay some building improvements. But she's philosophical about it: "It was God's money in the first place," she tells Siegel. Some repairs at Paulding County Hospital may be put off, too. It could have been worse: The hospital kept its capital construction fund at Oakwood Deposit, but its payroll account was safe at another bank.

The Wayne Trace School District, which oversees two local primary schools and one combined middle school and high school, also banked with Steve Miller, who was on the school board. The state of Ohio came through with a "solvency" award that covered the district's endangered deposits. The financial blow to Oakwood is clear -- but the larger issue of trust may never be fully resolved. "In the village where he once personified solidity and reliability, (Miller) is now a figure of resentment and mystery, a subject of gossip and prayer," Siegel says. "He is the man who made the people of Oakwood, Ohio, wonder if they really know one another as well as they thought."

Here is a article that will make the story even worse. I am the Hall in the story. This is a printer friendly version of an article from www.toledoblade.com ©2001 The Blade. Privacy and Security Statement. By using this service, you accept the terms of our visitor agreement: Please read it. To print this article open the file menu and choose Print. Back to: http://www.toledoblade.com/apps/pbcs.dll/article?Site=TO&Date=20020206&Category=NEWS17&ArtNo=102060016&Ref=AR Article published February 6, 2002 Bank’s collapse no shock to some By JOE MAHR BLADE STAFF WRITER If Paulding County residents were shocked to hear of the problems at an Oakwood bank last week, that surprise shouldn’t have extended to banking regulators. A private investigator said he tipped off federal and state officials about other problems at Oakwood Deposit Banking Co. nearly five years before the bank’s chief executive officer confessed Thursday to embezzling $40 million. "I called everybody and their brother trying to get help," investigator David Hough told The Blade. Now, Oakwood area residents are reeling from charges that bank’s chief executive officer, Mark Steven Miller, embezzled two-thirds of the bank’s deposits - causing the century-old bank to fail and directly costing customers with more than $100,000 in savings. Many bank customers said they were surprised at the extent of the alleged corruption surrounding Mr. Miller - a 47-year-old Wayne Trace school board member and lifelong resident of nearby Grover Hill. As late as last month, the bank even had the highest security rating from an industry tracker, Bauerfinancial, Inc. But the bank’s sudden demise is not a shock to Mr. Hough. The former Findlay College criminal-justice professor said he had written the Federal Reserve Bank in Cleveland and the state Department of Commerce around 1997 complaining about the bank. He said he called the local FBI and state Bureau of Criminal Identification and Investigation. While Mr. Hough said he didn’t know about the embezzlement five years ago, he did at the time question the bank’s role in one of the area’s last major scandals, which involved an Ottawa Oil salesman who bilked the company and more than 900 customers out of at least $100,000 over two decades. The salesman - Ralph Franklin Sharp - had deposited much of the stolen money in his personal account at the Oakwood bank, where his nephew was a top aide to Mr. Miller, according to court documents. The Oakwood bank even accepted checks that Sharp’s customers had written to "Ottawa Oil." Sharp either signed his name or Ottawa Oil’s on the back of the checks, and the bank cashed them, Mr. Hough said. "How in the hell could you cash a check written to the Ottawa Oil Co. at your personal bank?" Mr. Hough recalled yesterday. The oil company hired Mr. Hough, a former police investigator from Indiana, and Charles Hall, then of Findlay, to investigate the case. Mr. Hall recalled the pair going to the Oakwood bank to talk to Mr. Miller about the possible criminal action. "We offered to show him the canceled checks, and Mr. Miller said there was no problem with the bank, that he had looked into it, and the Oakwood bank wasn’t responsible if anything was going on," said Mr. Hall, who now lives in Toledo. In fact, court records show the Oakwood bank fought the efforts to get bank records central to a civil lawsuit against Sharp. Besides the check-cashing policy, the private investigators said they were surprised at the closeness of the nephew - John Blane Fickel - to the case. Besides being Mr. Miller’s assistant and Sharp’s nephew, Mr. Fickel bought a 22-acre parcel of land from Sharp the day Sharp was sentenced to prison, in December, 1996. Mr. Fickel and his wife, Claudia, bought the land for $29,500 - only about half its market value at the time, according to records from the Paulding County auditor’s office. To pay for the land, Mr. Fickel got a $50,000 mortgage from Oakwood bank. A civil suit ended in 1999, when Sharp settled for $125,000. To pay the money, Sharp got a loan from Oakwood bank. About two years before the case ended, Mr. Hough said he had sent a letter to the Federal Reserve Bank - the federal agency that oversees banking. He got no response. So he called them. "Finally I talked to somebody in Cleveland and they assured me that they would look into it," Mr. Hough said. He could not recall with whom he had talked. It’s unclear whether there was an investigation by the Federal Reserve, which won’t discuss any complaints against the Oakwood bank or release any financial audits. June Gates, an agency spokeswoman in Cleveland, said federal law prohibits such disclosure. All she could say was that the agency routinely audits banks at least every 18 months. Mr. Hough said he also wrote to state commerce officials - who oversaw Oakwood because it was a state-chartered bank. But this agency as well won’t release any records of complaints or audits - saying they’re confidential under state law. Neither agency would confirm or deny receiving a letter from Mr. Hough. The FBI did not return a phone call for comment. Bret Crow, a state Bureau of Criminal Investigation spokesman, said the agency had no record of any investigation, saying the agency first would have had to have been invited in by local law enforcement. Sharp, who served six months in prison, didn’t return a phone call. Mr. Miller remains in the Lucas County jail. His attorney, Martin Mohler, has declined comment. Mr. Fickel never has been accused of any wrongdoing and still works at the bank. He declined to comment yesterday unless State Bank and Trust of Defiance - the bank that took over the Oakwood bank - agreed to let him speak. State Bank spokeswoman Tina Farrington said she would not allow the interview. Mr. Fickle, like all other Oakwood employees, was hired as a temporary employee. Whether Mr. Fickle or any others officially are hired as State Bank employees depends on them passing the normal employment screening, said Ms. Farrington, a senior vice president for State Bank’s parent company, Rurban Financial Corp. She said the bank is relying on federal investigators to decide if anyone besides Mr. Miller was involved or had knowledge of the $40 million embezzlement. "The FDIC [Federal Deposit Insurance Corp.] is doing their ongoing investigations, and we’re relying on what they’re going through. So we will do our normal hiring process," she said. Blade staff writer Kim Bates contributed to this article.

My eyes! My eys!

Article published February 6, 2002
Bank's collapse no shock to some

By JOE MAHR
BLADE STAFF WRITER

If Paulding County residents were shocked to hear of the problems at an Oakwood bank last week, that surprise shouldn't have extended to banking regulators.

A private investigator said he tipped off federal and state officials about other problems at Oakwood Deposit Banking Co. nearly five years before the bank's chief executive officer confessed Thursday to embezzling $40 million.

"I called everybody and their brother trying to get help," investigator David Hough told The Blade.

Now, Oakwood area residents are reeling from charges that bank's chief executive officer, Mark Steven Miller, embezzled two-thirds of the bank's deposits - causing the century-old bank to fail and directly costing customers with more than $100,000 in savings.

Many bank customers said they were surprised at the extent of the alleged corruption surrounding Mr. Miller - a 47-year-old Wayne Trace school board member and lifelong resident of nearby Grover Hill. As late as last month, the bank even had the highest security rating from an industry tracker, Bauerfinancial, Inc.

But the bank's sudden demise is not a shock to Mr. Hough.

The former Findlay College criminal-justice professor said he had written the Federal Reserve Bank in Cleveland and the state Department of Commerce around 1997 complaining about the bank.

He said he called the local FBI and state Bureau of Criminal Identification and Investigation.

While Mr. Hough said he didn't know about the embezzlement five years ago, he did at the time question the bank's role in one of the area's last major scandals, which involved an Ottawa Oil salesman who bilked the company and more than 900 customers out of at least $100,000 over two decades.

The salesman - Ralph Franklin Sharp - had deposited much of the stolen money in his personal account at the Oakwood bank, where his nephew was a top aide to Mr. Miller, according to court documents.

The Oakwood bank even accepted checks that Sharp's customers had written to "Ottawa Oil." Sharp either signed his name or Ottawa Oil's on the back of the checks, and the bank cashed them, Mr. Hough said.

"How in the hell could you cash a check written to the Ottawa Oil Co. at your personal bank?" Mr. Hough recalled yesterday.

The oil company hired Mr. Hough, a former police investigator from Indiana, and Charles Hall, then of Findlay, to investigate the case.

Mr. Hall recalled the pair going to the Oakwood bank to talk to Mr. Miller about the possible criminal action.

"We offered to show him the canceled checks, and Mr. Miller said there was no problem with the bank, that he had looked into it, and the Oakwood bank wasn't responsible if anything was going on," said Mr. Hall, who now lives in Toledo.

In fact, court records show the Oakwood bank fought the efforts to get bank records central to a civil lawsuit against Sharp.

Besides the check-cashing policy, the private investigators said they were surprised at the closeness of the nephew - John Blane Fickel - to the case. Besides being Mr. Miller's assistant and Sharp's nephew, Mr. Fickel bought a 22-acre parcel of land from Sharp the day Sharp was sentenced to prison, in December, 1996.

Mr. Fickel and his wife, Claudia, bought the land for $29,500 - only about half its market value at the time, according to records from the Paulding County auditor's office. To pay for the land, Mr. Fickel got a $50,000 mortgage from Oakwood bank.

A civil suit ended in 1999, when Sharp settled for $125,000. To pay the money, Sharp got a loan from Oakwood bank.

About two years before the case ended, Mr. Hough said he had sent a letter to the Federal Reserve Bank - the federal agency that oversees banking. He got no response. So he called them.

"Finally I talked to somebody in Cleveland and they assured me that they would look into it," Mr. Hough said. He could not recall with whom he had talked.

It's unclear whether there was an investigation by the Federal Reserve, which won't discuss any complaints against the Oakwood bank or release any financial audits.

June Gates, an agency spokeswoman in Cleveland, said federal law prohibits such disclosure. All she could say was that the agency routinely audits banks at least every 18 months.

Mr. Hough said he also wrote to state commerce officials - who oversaw Oakwood because it was a state-chartered bank.

But this agency as well won't release any records of complaints or audits - saying they're confidential under state law. Neither agency would confirm or deny receiving a letter from Mr. Hough.

The FBI did not return a phone call for comment. Bret Crow, a state Bureau of Criminal Investigation spokesman, said the agency had no record of any investigation, saying the agency first would have had to have been invited in by local law enforcement.

Sharp, who served six months in prison, didn't return a phone call. Mr. Miller remains in the Lucas County jail. His attorney, Martin Mohler, has declined comment.

Mr. Fickel never has been accused of any wrongdoing and still works at the bank.

He declined to comment yesterday unless State Bank and Trust of Defiance - the bank that took over the Oakwood bank - agreed to let him speak. State Bank spokeswoman Tina Farrington said she would not allow the interview.

Mr. Fickle, like all other Oakwood employees, was hired as a temporary employee.

Whether Mr. Fickle or any others officially are hired as State Bank employees depends on them passing the normal employment screening, said Ms. Farrington, a senior vice president for State Bank's parent company, Rurban Financial Corp.

She said the bank is relying on federal investigators to decide if anyone besides Mr. Miller was involved or had knowledge of the $40 million embezzlement.

"The FDIC [Federal Deposit Insurance Corp.] is doing their ongoing investigations, and we're relying on what they're going through. So we will do our normal hiring process," she said.

Blade staff writer Kim Bates contributed to this article.

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