April 23, 2005
Retired Colorado Springs banker Gary Flanders was convicted Wednesday of federal bank fraud and related charges in connection with efforts to buy land in Oklahoma.
Jurors convicted Flanders, 62, after three hours of deliberation and despite his testimony during an eight-day trial denying the charges. He faces up to 30 years in prison and $1 million in fines. Sentencing has not been scheduled. Flanders plans to appeal his conviction to the U.S. Appeals Court in Denver, said Mark Hendricksen, Flanders’ attorney in Oklahoma. A staple of the local social scene for nearly two decades, he entertained the city’s elite from his Broadmoor-area mansion in the 1980s and 1990s. His efforts to keep the 2.2-acre estate from creditors forced him into bankruptcy by 1998. Flanders had made his fortune in Minnesota by investing in Control Data Corp. stock and farmland near Minneapolis that made him a millionaire when he was 30. He retired and moved to Colorado Springs in 1972. Flanders bought the Broadmoor-area house in 1984. He lost the historic 16,000-squarefoot house in 2002, when the U.S. Bankruptcy Court sold it for $1.69 million to repay creditors. He now lives in a rented 2,200-square-foot home in northwest Colorado Springs. Flanders was indicted in November 2003 in an Oklahoma City federal court on six counts of bank fraud, conspiracy, misapplying bank funds and related charges. The indictment alleged that he and associate David Solomon lied in 1999 to get the bank Flanders owned to make them a $514,000 loan. The pair planned to use the loan to develop 160 acres in Newcastle, Okla., a small town west of Norman, into a subdivision called Eden Estates. The indictment also said Flanders used another loan to divert money for use by Solomon and himself. Flanders bought MetroBank in Oklahoma City in 1990 and was chief executive when regulators barred him in 1999 from involvement in lending decisions. He was removed from his post in 2000. The day before he was forced out of the bank, the indictment charged, he tried to sell the bank’s headquarters to a company controlled by his wife, who later sought a divorce. The bank’s new chief executive canceled the deal when he discovered it two days later. The Associated Press contributed to this report.