Federal Reserve Bans Former Illinois Bank Executive for Inflated Appraisal Loans
The Federal Reserve has banned James Burns, former chief lending officer at Heritage State Bank in Lawrenceville, Illinois, for approving loans based on inflated appraisals. Burns, who served from 1999 until the bank's acquisition by First National Bank of Carmi (FNBC) in 2020, approved four loans using altered appraisals that reflected inflated property values. He also failed to ensure at least 25 loans or renewals were appraised by licensed appraisers and ignored inconsistencies. After FNBC foreclosed on some loans, collateral sales yielded substantially less than original appraisal values, causing financial losses. The Fed stated Burns' conduct involved violations of law, breaches of fiduciary duty, and personal dishonesty. Burns consented to the order and agreed to comply. FNBC has since been renamed First Bank.
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