Lawrenceville resident Allan Becer started saving for emergencies when he served in the Army during the Vietnam War. Now 64, he saved much of the money in an account at Metropolitan Savings Bank.
When two unsuccessful knee surgeries left him disabled and jobless, $57,000 of the money he had saved was gone because Michael P. Bernick, 51, of Stanton Heights and others had looted the century-old community bank, Becer said Friday during Bernick’s sentencing hearing in federal court, Downtown.
“It was a bank you could trust,” Becer said. “It had been through the Depression and a lot of hard times.”
A federal jury in September convicted Bernick on nine of 10 counts of theft, embezzlement or misappropriation by a bank officer. The government contends the $347,000 he took from the bank led to its demise.
U.S. District Judge Arthur Schwab agreed and sentenced Bernick to 12 years in prison and five years of probation. He ordered Bernick to jointly pay $9.9 million in restitution to the Federal Deposit Insurance Corp., Becer and 23 other depositors whose losses weren’t fully covered by the FDIC.
The other person responsible for repaying the money is the bank’s former vice president and managing officer. Donna Shebetich, 50, of Stanton Heights pleaded guilty in June 2011 to filing false entries in bank records that hid its increasingly shaky financial condition from the FDIC.
Shebetich, Bernick’s former girlfriend, is serving a six-year prison sentence.
Bernick initially declined to address the court, but after Becer described how he and the other depositors were working-class people whose life savings were in the bank, Bernick said he renovated the bank’s façade and made other improvements.
“I did everything I possibly could to make that bank respectable,” he said.
Bernick, a contractor, bought distressed properties, fixed them up and sold or rented them. When other banks started foreclosing on some of his properties, he borrowed the money from Metropolitan Savings Bank to save the properties, Assistant U.S. Attorney Carolyn Bloch said during the trial.
He obtained the money from Shebetich with no credit reports, collateral, promissory notes or payment plans, she said.
While the jury convicted him for stealing $347,000, the amount he pocketed was more than $500,000 and represented more than half of the bank’s disposable assets, Bloch said Friday.
He also knew that 34 other people were getting similar undocumented loans from the bank and that those loans totaled $2.2 million, but he and Shebetich hid that from the other directors during their monthly meetings.
“There is no way he could not have known that the bank would fail,” Bloch said.
James Brink, Bernick’s lawyer, argued that the government failed to prove his client’s conduct led to the bank’s failure or that he was responsible for the $9.4 million the FDIC lost and the nearly $500,000 lost by the 24 depositors.
“There is no nexus between his failure to repay these loans and the failure of the bank,” he said.
Schwab disagreed: “We all need to bear in mind that the defendant was found guilty of a crime, and the crime was not sloppy accounting.”
He agreed to let Bernick self-report to prison but placed him on home detention with electronic monitoring until he’s told to report.
Brian Bowling is a staff writer for Trib Total Media. Reach him at 412-325-4301 or [email protected].