The former CEO of the now-failed First National Bank of Lindsay pleaded guilty to bank fraud Wednesday and now faces up to 30 years in prison and a fine of up to $1 million.
Danny Seibel, who led the bank from 2007 until his termination in September 2024, oversaw the issuance of loans to at least three borrowers – his personal friends and neighbors – which were never repaid, the Justice Department said in a Thursday press release.
He manipulated and falsified numerous bank records to overstate the performance of these loans, including by new loans or bank funds to cover overdrafts and outstanding loans, the DOJ alleged.
“On or about March 2020 through September 20, 2024, in the Western District of Oklahoma, I knowingly executed a scheme or artifice to defraud the First National Bank of Lindsay by means of false or fraudulent pretenses, representations or promises,” Seibel wrote in his guilty plea petition Tuesday.
“First National Bank of Lindsay was FDIC insured and I acted with intent to defraud it. My fraudulent actions were capable of influencing the decision of the bank and I placed the bank at risk of civil liability or financial loss,” he wrote.
The Office of the Comptroller of the Currency shuttered the bank in October 2024 after identifying information suggesting fraud that revealed depletion of the bank’s capital and referred the case to the DOJ.
While not all borrowers were aware that Seibel failed to record their loans or made false entries about their loans in bank records, others directly requested that Seibel “fix” or manually add funds to their accounts when they needed money, according to a December indictment.
On one instance in March 2024, Seibel pushed back, according to a text message included in the indictment.
“You bring me deposits tomorrow. I am finally totally tapped. Way too far OD. You need to go factor and cover this overdraft ... Hey I'm over $500k. I'm tired of taking care of your business and get no damn deposits. I have legal lending limits and overdrafts are part of it. I'm sorry my job ain't worth it.”
However, three weeks later, Seibel manually added $536,850 to the borrower’s account to wash out the borrower’s -$533,598.54 balance. No such deposit had been made.
FNBL was the second of two banks to fail in 2024, at which time its deposits were assumed by Duncan, Oklahoma-based First Bank & Trust Co. Amid the 2023 regional bank crisis that saw several large bank failures, Seibel penned a note to FNBL’s customers to assure them that all was well at FNBL.
“We want to assure you that the situations at [Silicon Valley Bank] and Signature [Bank] are very unique due to each bank’s uncommon investment practices, and the high number of startup, technology and cryptocurrency companies those banks served,” Seibel wrote.
“Our customers are from right here in Lindsay and the surrounding community. Our management and Board of Directors remains committed to the traditional banking model with sound financial practices that have allowed us to serve you for 120 years. Our capital position is very solid, we are very liquid, and we continue to manage our investments diligently,” he wrote.
Seibel’s career at FNBL began in 1993, when he was 22 years old, according to the indictment. He is now employed by Comfort Foam, a spray foam installer in Maysville, Oklahoma, according to his plea document.
