It was announced yesterday by U.S. Attorney Karen L Loeffler that Anchorage man 57-year-old Lee E. Baker, Jr was sentenced in U.S. District Court for twelve counts of False Statements to a Credit Union.

According to the prosecutor in the case, Assistant U.S. Attorney Retta Randall, while drawing down the proceeds of a $9.2 million construction loan from the Denali Alaskan Federal Credit Union, Baker made false statements certifying that certain work had been done, while very little of the work had been done.

Baker, the President of Discovery Construction submitted 12 draw requests for the 85 unit Bryn Mawr project located on Northern Lights Boulevard in Anchorage. The apartment building was never completed. As a result of his false statements, Baker received approximately $4.3 million after submitting falsified draw requests.

Baker eventually defaulted on the loan and the property was sold.

Baker was indicted by a Federal Grand Jury on fourteen counts on January 20, 2012 for financial fraud and money laundering. He pleaded guilty to 12 counts on September 12th of 2012.

After Chief U.S. District Court Judge Ralph Beistline imposed a sentence of 36 months in prison, the judge stated, “Ultimately the success of the banking industry and the construction industry depends on integrity.” Judge Beistline went on to acknowledge that the construction industry in Alaska faces challenges, but insisted that, “When facing challenges, the highroadmust be taken.” He further indicated that fundamental principles of honesty and integrity are necessary to deal with problems before others get hurt and that the community cannot tolerate this kind of deception. Giving Discovery Construction credit for work completed on the Byrn Mawr project, Baker was ordered to pay $3 million in restitution.

United States Attorney Karen Loeffler noted, “Financial crimes such as those committed by Baker create significant and lasting harms on the community as well as the businesses affected. The Alaska federal law enforcement community is dedicated to working together to investigate and prosecute these serious crimes.”