OMAHA — A key figure in a loan scam in which more than $45 million in credit was sought from 19 Nebraska and Iowa banks has pleaded guilty to conspiracy to commit bank fraud.

Jesse T. Hill, 35, of Hickman, entered a guilty plea in U.S. District Court, federal prosecutors announced this week.

Hill was an investment adviser to Lincoln businessman Aaron Marshbanks, who committed suicide in November 2022 as word of the fraudulent loans spread within the banking community.

Hill, who operated as First SOJO Capital Group, LLC, would accompany Marshbanks to banks when he applied for loans, mostly about $2 million each. Hill would produce fraudulent financial statements indicating falsely that Marshbanks had sufficient assets to obtain the loan.

Hill, according to federal investigators, knew the representations being made to the financial institutions were false and were done with the intent to defraud.

According to court records, the scam perpetrated by Hill and Marshbanks — a former star athlete at Lincoln Christian High School — began in 2020. They eventually prompted banks to seek more than $30 million in restitution from the Marshbanks estate for unsecured loans.

Another $22 million in loans were found to have been secured by residential rental property that Marshbanks had purchased in Lincoln, Omaha and as far away as New Orleans.

State banking officials have said that Marshbanks had suffered catastrophic losses from investments due to “a highly aggressive options trading strategy” by his financial adviser, Hill.

The Examiner first broke this story in December 2022, in what has been described as possibly the largest bank fraud case in Nebraska history.

The scheme sent shockwaves through the banking and Lincoln Christian communities over how a devout father, who was involved in charitable causes, could have fooled so many bankers.

Some of the funds obtained by Marshbanks were used to build a luxury home and barndominium east of Lincoln.

As part of the plea agreement, Hill agreed to pay restitution and forfeit his interest, if any, in a property in Puerto Rico and a PC-12/47E Pilatus Aircraft that had been purchased via a Charles Schwab account held by Marshbanks.

U.S. Magistrate Judge Jacqueline DeLuca scheduled Hill’s sentencing for 3 p.m. on Sept. 11 with U.S. District Court Judge Susan M. Bazis. Hill faces up to a maximum penalty of 30 years’ imprisonment, a fine of up to $ 1 million and a mandatory special assessment of $100.

A handful of civil lawsuits have been filed against Hill as well.

Shortly after news of the scandal became public, the Nebraska Department of Banking and Finance obtained an injunction that blocked Hill from disposing of assets or destroying financial documents. The department alleged several violations of state securities laws, including that Hill converted investments for personal use and lied to investors.

This isn’t the first time Hill has faced sanctions. In 2018, the state Banking Department fined Hill $7,500 and ordered him to repay investors after authorities discovered he had sold more than $4 million in unregistered securities to 47 investors through a firm called JT Equity.

This story was published by Nebraska Examiner, an editorially independent newsroom providing a hard-hitting, daily flow of news. Read the original article: https://nebraskaexaminer.com/2024/02/12/financial-adviser-who-allegedly-...