PENSACOLA —  A former Pensacola Beach title attorney has been sentenced to 40 months in prison and ordered to pay more than $3.7 million in restitution today for bank fraud, embezzlement and money laundering, the U.S. Attorney's Office announced Friday.

Richard Michael Colbert, 56, defrauded the now defunct GulfSouth Private Bank in 2007 by submitting a false HUD-1 Settlement Statement to the bank so his business partner, former builder Lawrence Wright, could obtain a $1 million loan from GulfSouth. The bank suffered $636,000 in losses as a result. 

Three years later, Colbert coordinated a bank and mail fraud conspiracy by handling a number of closings that defrauded Bank of America, Beach Community Bank and the now defunct Premier Community Bank, the U.S. Attorney's Office said in a press release. The banks sustained losses exceeding $2.3 million.

Colbert then made a series of financial transactions that laundered the funds he had embezzled between December 2010 and March 2011.  Colbert was contacted by Beach Community Bank’s personnel in September 2011 to determine where the money was located, money which Colbert obtained from a third party to replace the funds he had initially embezzled. However, after placing the third party’s money into the Beach Community account, Colbert then embezzled more than $237,000 from the same account. 

He also was found to have stolen $36,000 from four homeowners/condominium associations that he had been entrusted to oversee.

The case was investigated by Internal Revenue Service-Criminal Investigation with assistance from the FBI, the Federal Deposit Insurance Corporation-Office of Inspector General and the Okaloosa County Sheriff’s Office.