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Two more sentenced in scheme to defraud Wachovia

By Rick Rothacker
rrothacker@charlotteobserver.com

Two more participants in a scheme that defrauded Wachovia Corp. of $11.2 million are headed to prison.

On Thursday, U.S. District Judge Max Cogburn Jr. sentenced both Delmar Dove, 61, of Mint Hill, and Robert Otto, 67, of Fort Mill, to 22 months in federal prison, according to the U.S. Attorney's Office for the Western District of North Carolina.

From at least 2000 through November 2008, Dove and Otto generated false invoices submitted to Wachovia for services that were never provided, according to court documents and court proceedings. Dove managed Callaway Farms, based out of Charlotte. Otto ran a home renovation company in Charlotte.

The pair produced the invoices under the direction of former Wachovia employee Terry Scott Welch, according to court documents and court proceedings. Welch, who oversaw payment of invoices submitted by outside vendors, used his position to lead a conspiracy by Dove, Otto and others to transmit fake invoices totaling more than $11 million.

Wells Fargo acquired Wachovia in 2008.

Dove and Otto entered guilty pleas last year. Cogburn ordered Dove to pay $1.2 million in restitution to Wells Fargo and $140,734 to the Internal Revenue Service. Otto was ordered to pay $2.6 million in restitution to Wells Fargo.

Cogburn previously sentenced Welch to serve 70 months in federal prison and to pay restitution in the amount of $11.2 million to Wachovia and $1.7 million to the IRS. Two other co-defendants, John Cousar Jr. and Jerry Little, also were previously sentenced to 33 months in prison and 15 months in prison, respectively. They also were ordered to pay restitution.


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