Metro area developer Randal L. Walters pleaded guilty Thursday to one count of bank fraud in connection with a loan to develop a Des Moines area condominium project, announced federal court officials in a news release.
During the plea proceeding in federal court, Walters, 55, of Polk County, admitted to diverting money borrowed from First Bank of West Des Moines for a Des Moines area condominium project know as the Meadow Cove project, the release said.
According to the Des Moines Business Record, Walters used part of a $4.5 million loan to make a down payment on a Sarasota, Fla., condominium and to cover a tax bill. Walters admitted using $220,000 for the Florida condominium and $69,000 to pay property taxes in Johnston for an entity known as Griz Lee.
Authorities dropped eight other charges against Walters, who could have faced 30 years in prison and been fined $1 million if found guilty on all counts. However, Assistant U.S. Attorney William Purdy told the Business Record the government would recommend that Walters not serve any prison time and instead be sentenced to a period of supervised release.
Walters will pay restitution of between $400,000 and $1 million.
The Business Record reported on Wednesday that Walters' business partner, John Kline of Urbandale, had his trial for bank and wire fraud delayed until January. Both men were scheduled to stand trial Monday. Kline’s lawyer, Paul Rosenberg, said the trial was delayed because he was having hip surgery.
This case was investigated by the United States Federal Bureau of Investigation, and was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.