Whistleblower case involving BB&T open to public

Judge Jeffrey Tureck on Friday, September 18^th denied BB&T’s request to hold a closed Federal Hearing involving Amy Stroupe who formerly worked for BB&T. Ms. Stroupe was fired from her position as an investigator for BB&T after she uncovered a North Carolina development scheme that cost the lender millions of dollars.

BB&T’s attorneys requested that the trail be closed to the public and media to protect the privacy of employees who were not involved in the case and to ensure that viable information about the bank and the continuing investigation not be discovered.  The case involves the one million dollar defaulted Village of Penland development and investigators are still collecting evidence in the case.

John Yanchunis, an attorney for Ms. Stroupe remarked that it was obvious the defendant’s motion to have a closed trail was simply to avoid public scrutiny in regard to the banks image. The wanted to avoid public access and I have never heard of that happening. The law is very clear that trails are public. The country has a long history of public trails.

The request for a closed trail is just the latest in the whistleblower case that started two years earlier with the United States Department of Labor. The Occupational Health and Safety Administration originally dismissed Ms. Stroupes case however they appealed and the present court. Federal law states that it is illegal to strike back against an employee for discovering and reporting a wrongful act. The hearing is currently scheduled for June 15^th in Winston-Salem, North Carolina.

Judge Tureck in this case could throw out the complaint or he could award back pay and order BB&T to reemploy Ms. Stroupe. Ms. Stroupe who was a Cleveland Country Sheriff’s deputy has not been able to find steady work since she was let go from BB&T’s employment. She currently has a lawsuit pending in state court in regard to the matter.

Bob Denham a representative for BB&T in the case said that Judge Tureck did leave open the option to not allow parts of the hearing to be open to the public. He stated that the judge agreed that some information in the case does need to remain private in order to protect and preserve the privacy of employees and the ongoing investigation. 

North Carolina’s largest fraud case is that of the Village of Penland. Attorney General Roy Cooper crushed the Penland project two years ago based on the information obtained by Ms. Stroupe in her role as the inside man that uncovered the scheme.

Cooper successfully received guilty pleas from five of the individuals involved in the scheme that started in 2000. Tony Porter, the developer in the Penland case recruited Richard Amelung and Frank Amelung as partners in the development project. The project was to be a complex of luxury houses with shops and boutiques centered in the Blue Ridge Mountains.

Amelung and Porter whom are brothers wanted to get into real estate development as they owned a Florida based manufactured home business. The brother set up a company and purchased one thousand two hundred acres in Mitchell County, North Carolina. The two then subdivided the property into over two thousand lots to create The Village of Penland.

Porter and the Amelungs’ created a complex scheme to entice investors to invest in the development. The scheme was not unlike that of a Ponzi scheme. A Ponzi scheme uses new investor funds to pay high returns to previous investors. The lot prices were inflated according to court documents and the defendants transfer money into other accounts for use in other projects, one of which included a spa in Brazil. The trio enticed lawyers and other highly skilled white collar professionals to lend money from banks for the lots and that their company Peerless would repay the loans during the course of the project. The loans on average were about one hundred twenty five thousand dollars each. The trio told the investors that each investor would receive approximately ten percent of the loan proceeds at the closing table. The told investors that additional funds would come once the individuals lost were sold.

BB&T was one of the major lending institutions that lent over twenty million dollars to the investors in the Penland scheme. The scheme itself came to light when one of the Shelby office employees felt that an employee who transferred in from another branch was processing an over abundance of loans for the Penland project. The employee asked the Ms. Stroupe look into the matter. Ms. Stroupe did look into the matter and interviewed several individuals and sorted through records for months before bring the matter to her boss in March of 2007.  Ms. Stroupe says that the boss didn’t want to hear about it. She contacted the Regional Manager and received no action. She then told the Associated Press all the while BB&T continue to lend on the Penland lots. Ms. Stroupe in a final effort to stop the scheme contacted the Federal Bureau of Investigation. Ms. Stroupe was then fired when the state closed down the project approximately one month later.

Investors in the scheme have stated that they are unable to repay the loans and some have settled; but most contend that their lives have been ruined. Banks for the most part have been filing law suits against the investors to recover monies lost.