The former owners of Blackhawk Auto in Milan, Illinois pleaded guilty to defrauding Milan Bank of more than $400,000.
Jens and Pamela Hirsch of Rock Island, Illinois each pleaded guilty to bank fraud, conspiracy to commit bank fraud and making a false statement to a bank.
The couple had a $1.5 million line of credit from Milan Bank to purchase vehicles for resale at Blackhawk Auto. The company was to repay the bank for the outstanding balance as the vehicles were sold.
Instead, the couple “admitted they repeatedly and intentionally failed to repay the bank and diverted the sale proceeds to other uses,” said a statement from the Department of Justice.
Court documents say the bank lost somewhere between $400,000 and $1 million.
The couple also confessed to submitting false financial statements to the bank and to making false statements to the bank during inventory inspections.
Each offense carries a maximum sentence of 30 years in prison and a fine of up to $1 million. However, if the court accepts plea agreements between the defendants and the government, the actual sentences could be lighter.
Sentencing is set for September 14, 2012.