Northville Man Pleads Guilty To Bank Fraud On Behalf Of Novi Firm

NORTHVILLE, MI — A Northville man faces up to 30 years in prison after he gave financial institutions phony information to secure a bank loans, according to the U.S. Attorney's Office.

Theodore Toloff, 65, pleaded guilty Wednesday to providing a financial institution with false documentation in connection with a bank loan, according to the office.

Toloff was originally charged with bank fraud and false statement in connection with a bank loan. He was released from jail on a $10,000 unsecured bond.

Toloff was the chief financial officer of the Frank W. Kerr Company, which is now a defunct pharmaceutical wholesaler that was based in Novi, according to the office.

The company had a revolving credit agreement with two large financial institutions, which the company borrowed funds up to $60 million pursuant to a calculation dependent on the company’s eligible accounts receivable and inventory, according to the office.

Toloff admitted that he submitted false documentation to the financial institutions that included $18 million in ineligible accounts receivable and that Kerr borrowed additional funds after this false documentation was submitted, according to the office.

"Today’s guilty plea reflects my office’s continued commitment to ensuring that our banking and lending systems are not distorted through false financial information," United States Attorney Dawn N. Ison said.

The Frank W. Kerr Company filed for Chapter 7 bankruptcy in 2016. Six pharmaceutical companies and a law firm were listed as petitioners with claims totaling more than $5.9 million. The company closed a Chapter 11 bankruptcy in 2020.