A 48-year-old Washington businessman pleaded guilty in federal court yesterday to illegally aiding misapplication of bank funds, in connection with a bad-check scheme that bilked the American Security Bank of more than $3 million over two years.
Ibrahim Awadallah, who ran a local limousine service and a travel agency, both of which are now defunct, was indicted last November by a federal grand jury on 33 counts of illegally aiding misapplication of bank funds.
At a hearing yesterday before U.S. District Court Judge Thomas Penfield Jackson, Awadallah pleaded guilty to three of those counts, each involving incidents in which he received money from the bank using either worthless personal checks or a closed London bank account as collateral.
A former manager at American Security's Woodley Park branch, Raymond C. Mowchan, pleaded guilty in September to misapplying the money and is serving a six-month prison sentence.
Assistant U.S. Attorney Charles H. Roistacher told Jackson that Awadallah used "each and every penny for his own use" and that the money went to pay for Awadallah's extensive business debts, back taxes and gambling losses. One of the checks issued before bank examiners discovered the scheme was a $20,000 check to the Playboy Hotel and casino in Atlantic City, Roistacher said.
Jackson accepted the guilty plea and scheduled sentencing for June 10. Awadallah faces a maximum five years in prison and a $5,000 fine on each count.