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FDIC Office of Inspector General, 3501 Fairfax Dr., VS-E9068, Arlinton, VA 22226


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FOR IMMEDIATE RELEASE
December 13, 2005



FORMER COMMUNITY BANK EXECUTIVE, KENNON PATTERSON SENTENCED

BIRMINGHAM, AL - KENNON R. PATTERSON, SR., 63, formerly of Blountsville, Alabama, was sentenced today by U.S. District Court Judge Sharon Lovelace Blackburn, to 60 months incarceration. The Court specifically noted that but for the Defendant’s age and medical condition, a much more significant sentence would have been imposed. PATTERSON was found guilty on March 10, 2005, of fifteen counts of conspiracy, bank fraud, causing false entries in bank records, and filing false tax returns. The Court will determine restitution and a term of supervised release for PATTERSON at a later date.

“Patterson bilked Community Bank so he could build a 17,000 square foot home. His greed will put him in the right size “home”for 5 years - a federal prison cell of about 60 square feet” said U. S. Attorney Alice H. Martin.

PATTERSON, along with LARRY E. BISHOP and JIMMIE D. CHILDERS were indicted on October 31, 2003 on charges that they engaged in a scheme to defraud to Community Bank from December 1997 until January 2002. PATTERSON was the former Chief Executive Officer of Community Bank and owned Heritage Valley Farms, a 1,100 acre parcel located in Blountsville. During the time period of the scheme, BISHOP served as Community Bank’s vice president of Construction and Maintenance. CHILDERS owned and operated J&M Materials, Inc. (“J&M”), an Oneonta excavating company.

Evidence presented during the seven-week trial established that CHILDERS and other subcontractors, including Dewey and Linda Hamaker of Morgan City, Alabama and their company, Morgan City Construction, Inc. (“MCC”) performed construction services on Heritage Valley Farms and then submitted invoices to Community Bank for those services. BISHOP approved those fraudulent invoices and in excess of $1.9 million of Community Bank were paid to J&M and MCC, primarily to fund construction at Heritage Valley Farms. Foremost among the projects funded with Community Bank money was a 17,000 square foot house PATTERSON was constructing at Heritage Valley Farms. Evidence at trial revealed that the scheme also resulted in Community Bank money being paid to fund construction services provided at various other locations owned by PATTERSON and his family, including residences in Auburn and Leeds and a separate farm in Blountsville owned by PATTERSON and another individual.

A federal jury convicted Dewey and Linda Hamaker of conspiracy and bank fraud in October 2002. Dewey and Linda Hamaker were both sentenced in May of 2003, to eighteen months incarceration.

Sentencing for BISHOP and for CHILDERS will be set by the Court at a later date.

The case was investigated by Special Agents of the Federal Bureau of Investigation, the Internal Revenue Service - Criminal Investigation Division, and the Federal Deposit Insurance Corporation, Office of Inspector General. The case was prosecuted by United States Department of Justice Trial Attorney William C. Athanas.

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