Warrant: Theft paid for drugs

Date: 2008-03-24

Warrant: Theft paid for drugs

Published Feb. 14, 2008, in The Gazette
Iowa City A former Hills Bank & Trust vice president and controller charged with embezzlement and money laundering admitted to bank officials to stealing more than $219,000 over three years and using most of it to buy cocaine, a search warrant The Gazette obtained Wednesday revealed.

Steven F. Sueppel, 42, of 629 Barrington Rd. in Iowa City, was indicted by a federal grand jury Tuesday, accused of stealing $559,040 from the bank and laundering the money to conceal the theft.

The eight-count indictment, filed in the U.S. District Court for the Southern District of Iowa following an investigation by the FBI and the Johnson County Sheriff's Office, says the alleged thefts began on July 26, 2000, and continued until Sept. 12, 2007.

Three search warrants executed by the Sheriff's Office and filed in Iowa City in Johnson County District Court reveal that Hills Bank officials reported on Oct. 4, 2007 that they had noticed discrepancies in one of the asset accounts Sueppel managed. Bank spokesman John Benson said Wednesday the alleged misconduct was discovered Oct. 3.

Sueppel was not charged with any drug-related offenses. No illegal drugs were taken from his home when a search warrant was executed Oct. 4.

Sheriff Lonny Pulkrabek said the investigation was ongoing. He declined to go into specifics, but said $219,000 would be an extraordinary amount to spend on personal drug use.

The Sheriff's Office seized from Sueppel's home two computers and computer equipment, according to the search warrant.

Search warrants also were executed at the Hills Bank office at 131 Main St. in Hills on Oct. 5 and 10. Items taken there included a computer, three DVDs, several boxes of checks and financial statements for Sueppel.

Sueppel told a detective he had a separate account at another bank that he would deposit stolen funds into, one of the search warrants says. That bank was not named, but seized were a Bank of The West statement for Sueppel and a book of checks from Commercial Federal Bank, which was acquired by Bank of the West in 2005.

Sueppel declined to comment when reached by phone at his home Wednesday.

His attorney, Leon Spies of Iowa City, said it would be premature to comment.
A preliminary court hearing has been set for Wednesday at the federal courthouse in Davenport, Spies said, although online court records did not yet show a hearing date.

Benson, the bank spokesman, said Sueppel's last day of work at the bank was Oct 3. Citing the ongoing investigation, he declined to say whether Sueppel resigned or was fired.

Bank officials have said the alleged thefts involved internal bank accounts and no customer accounts were affected. They also said the bank has an insurance bond for employee dishonesty and is filing a claim, and that the bank is "well capitalized" with more than $150 million in equity and reserves.

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