Former CFS vice president pleads guilty to conspiracy

<br>TULSA, Okla. (AP) _ The former executive vice president of Commercial Financial Services, which collapsed in 1998, pleaded guilty Friday to a federal conspiracy charge. <br><br>Jay Lowell Jones, 61,

Friday, September 13th 2002, 12:00 am

By: News On 6

TULSA, Okla. (AP) _ The former executive vice president of Commercial Financial Services, which collapsed in 1998, pleaded guilty Friday to a federal conspiracy charge.

Jay Lowell Jones, 61, was the only person named in the charge, which alleges he and a co-conspirator plotted to make money by ``promoting the sale of asset-backed securities to investors by misrepresenting the performance of existing CFS trusts.''

The charge was sealed until Tuesday when Jones appeared for an arraignment.

The alleged conspiracy included mail fraud, wire fraud, bank fraud and money laundering, the charge states.

The charge carries a maximum penalty of five years in prison, but federal sentences are controlled by a guideline system that includes punishment ranges well below statutory maximums.

The company purchased bad or nonperforming credit card accounts from card issuers, then sold bonds based on its ability to collect on those accounts.

Bond rating agencies graded those bonds as high-quality investments. The money from the bond sales then funded the purchase of more bad accounts.

The appearance of an anonymous letter in 1998 led to a suspension and downgrading of CFS bonds, which cut the company off from its principal source of finances.

CFS, which employed up to 3,900 people in Tulsa and Oklahoma City, filed for bankruptcy protection in December 1998. The company failed to find a buyer and closed its doors in June 1999.