A resolution could be close in a federal fraud case involving an Atlanta area hotel developer.
A change of plea hearing is scheduled for Monday in Nashville for R.C. Patel of Duluth, who was indicted last year on five counts of wire fraud, one count of mail fraud and four counts of money laundering. He previously pleaded not guilty to the charges.
A June 22 court filing states that Patel and the government “have reached a plea agreement” to resolve the case. Terms of the possible deal were not immediately available.
Don Samuel, an attorney for Patel, declined to comment beyond an acknowledgement of the scheduled hearing. A spokesman for the U.S. Attorney’s Office for the Middle District of Tennessee also declined comment.
Patel is well-known in Atlanta’s hospitality community and ranked among the region’s most prominent Indian-American businessmen. But he ran into repeated business troubles as the economy tanked.
The indictment accuses Patel of defrauding a Tennessee investor of $1.5 million that was supposed to go toward equity in two hotels, including a plan to purchase the mortgage of a Best Western hotel in Atlanta. Prosecutors allege Patel diverted funds from the investor to pay personal expenses, including unrelated debts.
Patel was a founder of Haven Trust Bank, a metro Atlanta institution that focused on financing the businesses of the region’s Asian communities, including hoteliers.
The bank failed in December 2008, crippled by bad bets in commercial real estate. A subsequent government post-mortem of the bank faulted bank insiders for many issues, including lax internal controls, sloppy loan underwriting and documentation and allegedly improper loans to family members. It also levied some fault on regulators for not acting quickly enough to curb alleged abuses.
The FDIC later sued Patel and 14 other Haven Trust insiders seeking nearly $40 million in damages. The civil liability case was settled last year for about $2.5 million, according to FDIC records.
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