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December 23, 2024

Former Webster Bank general counsel pleads guilty in $7.4M embezzlement scheme

HBJ PHOTO | ANDREW LARSON Webster Bank's office at 145 Bank St., Waterbury.

The former general counsel of Stamford-based Webster Bank has pleaded guilty to charges in connection with an embezzlement scheme, in which he pocketed about $7.4 million from multiple financial institutions.

James Blose, 56, stole from the banks in multiple ways, including in commercial loan transactions, by retaining portions of the closing costs for himself, according to authorities.

Also, when the banks sold property in real estate deals, Blose would keep portions of the sale proceeds for himself, authorities said.

The scheme occurred from about 2013 to February 2023. During that time, Blose held high-level positions at Hudson Valley Bank, Sterling National Bank and Webster Bank, which acquired Sterling in January 2022.

Blose served as executive vice president, general counsel and corporate secretary at Webster Bank from about January 2022 to February 2023, when Webster Bank discovered the scheme and terminated him.


Using his attorney trust accounts to make personal expenditures, Blose would transfer funds to accounts in the names of business entities he created and controlled, and then used the money for himself, authorities said.

On Friday, in New Haven federal court, Blose pleaded guilty to charges of bank fraud and engaging in illegal monetary transactions. Together, the charges carry a maximum of 40 years in prison.

Blose has been released on a $250,000 bond. His sentencing is scheduled for March 13 in Hartford.

This investigation was conducted by the FBI, Internal Revenue Service, and the Board of Governors of the Federal Reserve System and the Bureau of Consumer Financial Protection’s Office of the Inspector General.

Webster Bank investigators provided assistance.


 

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