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CHARLOTTE, NC (AP) — Two former executives of the bankrupted
Peak Fitness in Charlotte have been charged with fraudulently
obtaining loans from Wells Fargo and Wachovia.

The Charlotte Observer reported Tuesday that former fitness
chain owner Jeffrey Stec and chief financial officer Kenneth Hanley
are charged with commercial loan fraud and money laundering

Prosecutors say the men used $130,000 from a commercial loan
from Wachovia to qualify to purchase a $915,000 condo on Isle of
Palms, S.C.

Prosecutors say that Hanley moved the money to a personal
account and received approval for the $856,000 loan from Wells

Prosecutors say the condo was later sold in a short sale in lieu
of foreclosure and Wells Fargo lost about $230,000.

Stec’s attorney would not comment. It wasn’t clear if Hanley has
a lawyer.

(Copyright 2011 by The Associated Press. All Rights Reserved.)

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