Fitchburg businessman charged with bank fraud, money laundering

Fitchburg businessman Christian Peterson, sentenced to probation last month in Las Vegas for passing a bad check and failing to pay a casino marker, was indicted Wednesday by a federal grand jury on charges stemming from bank loans he received for business purposes that were instead allegedly used to gamble at casinos.

The transactions all took place in 2006 and 2007, according to the 12-count indictment issued in Madison that charged Peterson, 43, with four counts of bank fraud, four counts of making a false statement to a financial institution and four counts of money laundering.

According to the indictment, Peterson received loans for his various businesses, which included scrap foam and the manufacture of carpet cushion, a hotel and real estate development, but misrepresented the purpose of the loans to the banks.

The indictment states that Peterson also misrepresented his financial condition in May 2007 to M&I Bank, claiming that certain accounts receivable were for loans when they were instead the result of gambling debts.

Peterson also is known as the owner of the Pancake Cafe and the newly opened PC Kitchen, and for his attempt at reality television with a show set in his former Good Times restaurant. He ran into trouble after a gambling spree in 2008 in Las Vegas that resulted in criminal charges in 2010 for failing to pay gambling debts.

The Las Vegas Review-Journal reported in June that Peterson received five years of probation for writing bad checks but could clear his record if he pays $2.5 million in restitution to Caesars Entertainment.

According to Wednesday's federal indictment:

In March 2006 Peterson received a $1 million loan from Park Bank to upgrade the swimming pool at his Country Inns and Suites, even though no such project was planned. The next month he had M&I Bank send a $300,000 wire transfer from a business line of credit to the MGM Grand Casino in Las Vegas, after telling the bank the line of credit wouldn't be for personal use.

In May 2007, Peterson misrepresented his finances to M&I Bank by giving it a personal financial statement that disguised $460,000 in gambling losses as loans to shareholders. And in December 2007 he got a $1.1 million construction loan from Greenwoods State Bank but used at least $300,000 to pay a gambling debt at a Las Vegas casino.

Each bank fraud and false statement count carries a penalty of up to 30 years in prison, and Peterson faces up to 10 years in prison on each money laundering charge.

(c)2012 The Wisconsin State Journal (Madison, Wis.)

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