Man allegedly defrauded Northwood State Bank of $300,000

NORTHWOOD — A former Northwood mayor is facing multiple charges for allegedly defrauding about $300,000 from Northwood State Bank while he was president of a lumber company in the city.

Randy Lee Severson, 52, was charged on Thursday in Worth County District Court with one count of ongoing criminal conduct, three counts of felony first-degree fraudulent practices and three counts of felony second-degree fraudulent practices.

Court documents allege that while acting as president of Northwood Lumber between 2011 and 2014, Severson created fraudulent invoices using the names and information of family members, customers and other acquaintances without their knowledge or consent. He allegedly submitted these invoices to Northwood State Bank in Northwood for lines of credit in amounts consistent with the fraudulent invoices.

Severson was reportedly interviewed by Iowa Division of Criminal Investigation and FBI agents in July 2013 and admitted to making the fraudulent invoices, court records state, however, he reportedly continued to create the invoices and submit them to the bank through 2014.

The Winnebago County Attorney’s Office has taken over the prosecution of the case because of a conflict of interest in the Worth County Attorney’s Office, according to Winnebago County Attorney Adam Sauer.

According to the Mason City Globe Gazette, Northwood Lumber announced on its Facebook page Feb. 17 it would cease operations the next day. The business had been open 25 years.

The newspaper stated Severson resigned as Northwood mayor during a City Council meeting in November 2012, citing health reasons. He previously served as a member of the council.