-- Donald K. Stern, U.S. Attorney in Boston, Deborah M. Smith, Director of the New England Bank Fraud Task Force, and Richard S. Swenson, Special-Agent-in-Charge of the FBI Boston office, announced today that Raymond A. Tedeschi, 50, former member of the board of directors of the Bank of Taunton and the owner of Tedeschi Real Estate Center Inc., was charged with William O'Neil, 45, Vice President of Tedeschi Real Estate Center, in a 19-count indictment alleging conspiracy and bank fraud. The indictment charges that, to obtain mortgage financing for real estate transactions between April 1987 and November 1990 and thereby to profit from real estate commissions and legal fees associated with the transactions, Tedeschi and O'Neil conspired with insiders at the Bank of Taunton and with Taunton-area attorneys and realtors to defraud the Bank of Taunton. The indictment charges that Tedeschi and O'Neil falsely inflated borrowers' down payments, falsified the borrowers' income and assets, submitted to the bank false income tax returns, W-2 forms, and paycheck stubs, concealed from the bank secondary financing,and engaged in other fraud which they told their customers was "creative financing." Tedeschi and O'Neil encouraged other realtors at Tedeschi Real Estate Center to obtain financing for customers by employing these fraudulent methods, the indictment alleges. According to the indictment, Tedeschi and O'Neil lied to the Bank of Taunton in this way to get approval for over $2.4 million in fraudulent loans. The loans did not meet the bank's lending and underwriting guidelines, according to the indictment, because the borrowers had not made a substantial cash down payment which the bank required to minimize the likelihood of default. If convicted, Tedeschi faces a maximum sentence of 205 years in prison and a $10.7 million fine, and O'Neil faces a maximum sentence of 80 years in prison and a $4 million fine. The charges against Tedeschi and O'Neil bring to five the number charged in a continuing investigation of fraud against the Bank of Taunton. Former Bank of Taunton vice president Michael G. McSweeney, attorney Virginia Leigh Jones, and realtor John J. Flanagan have each been charged with related offenses. Jones and Flanagan have pleaded guilty to the charges and are awaiting sentencing. The investigation is being conducted by the New England Bank Fraud Task Force, which was established in 1991 as part of the Justice Department's campaign to combat fraud against federally insured financial institutions. Members of the task force include the U.S. Attorneys' offices for each of the six New England states, the Fraud Section of the Department's Criminal Division, the Civil and Tax Divisions, the FBI the Internal Revenue Service, and the Secret Service. The case was investigated by the FBI and is being prosecuted by James P. Gillis and Donald C. Lockhart, Fraud Section trial attorneys who are assigned to the New England Bank Fraud Task Force.