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Former KleinBank employee accused of stealing $639,000
Local bank employee charged with stealing more than $600,000 from customers.
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A former employee of KleinBank of Chaska has been charged with stealing $639,000 from the bank's customers, according to a charge filed Tuesday by the U.S. attorney's office in Minneapolis.
Gregory Gerard Meyer, 39, of Wayzata, who worked as an investment representative at KleinBank's branches in Victoria and Norwood Young America, made "fraudulent and unauthorized withdrawals" from the accounts of four depositors of KleinBank and caused those funds to be routed into accounts under his own control, the U.S. attorney's office said in a charge filed in U.S. District Court in Minneapolis. Meyer used the money to pay personal expenses, the U.S. attorney's office alleged. The withdrawals occurred from March 2006 through October 2008.
Prosecutors charged Meyer in a manner that generally means a plea bargain is coming.
Dan Klein, chairman of KleinBank, said in a written statement that Meyer was fired last December "following the discovery, and after his own admission, that he had misappropriated customer funds." KleinBank contacted the affected customers immediately and returned the money with interest, Klein's statement said.
"This is a very unusual circumstance for KleinBank," Klein said in the statement. "Even though it is an isolated incident, we have taken steps to ensure that this will not, and cannot happen again -- in any part of our organization. Our integrity is one of our highest core values; our customer's trust is something we strive to earn every day." Klein added that, "there is no reason for any customer to be concerned about their deposits."
KleinBank has $1.6 billion in assets and 22 branches, primarily in the western Twin Cities suburbs.
KleinBank officials discovered the alleged theft when a customer contacted the bank concerning a "perceived market loss in an investment account," Klein wrote in an e-mail response to questions. "After we took a closer look, it was clear that the account had been tampered with and that funds were missing. We approached the investment representative in charge of the account, and he confessed to the theft."
If convicted, Meyer faces a maximum sentence of 30 years in federal prison and a fine of up to twice the gross gain from any criminal activity, or about $1.28 million, according to a spokesman for the U.S. attorney's office, but the actual sentence could be substantially less. The FBI and the Carver County Sheriff's Office conducted the investigation. A plea hearing has not been set.
This is the second time in about a year that a Minnesota bank employee has been accused by federal officials with misappropriating funds from bank customers.
In October 2008, Gerald Alan Payne, the former president and majority owner of First State Bank Minnesota in LeRoy, Minn., a town of about 1,000 people about 25 miles east of Albert Lea, admitted to obtaining money from customer bank accounts, charging personal expenditures on the bank's credit cards and cashing checks written to the bank and others while keeping the cash for himself. Payne was sentenced in May to 30 months in federal prison and ordered to pay $609,848.
In a sentencing hearing in May, U.S. District Court Judge Ann Montgomery said Payne's crimes had "ripped a small town asunder."
Chris Serres • 612-673-4308
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