A former rep with First Tennessee Bank is serving a three-year sentence in federal prison for embezzling more than $1 million from bank customers and cheating on his tax returns.

Kenneth Lynn Miller, a manager of investments and other bank products who many in the community considered a "go-to guy," defrauded numerous customers to satisfy a gambling addiction that started when he was in college, according to documents filed in federal court in Tennessee.

Miller swindled customers by accessing and transferring funds out of their CDs and other accounts over a four-year period beginning in 2012. He pleaded guilty to one count of theft and four counts of tax evasion last year.

Prosecutors blasted Miller for abusing his position as a long-standing employee with inside knowledge of the bank's processes to embezzle money from people who trusted him and whom he knew would be unlikely to detect his unlawful activities.

He targeted his victims, choosing customers who did not review their monthly account statements or whose accounts were inactive, according to court filings.

"The defendant's conduct was methodical, deliberate and persistent," prosecutors argued in their sentencing memorandum.

Miller worked for both First Tennessee in Mosheim, Tennessee, and for FTB Advisors, the bank's brokerage arm, in Memphis. He was discharged from FTB Advisors in February 2016 and barred a month later by FINRA.

POKER, CASINOS AND DAILY FANTASY SPORTS
Miller's criminal conduct began in February 2012 when his gambling losses at online poker sites and casinos spiraled out of control. To pay off his debts, he embezzled $78,702 from a CD that his mother had at First Tennessee and later took another $52,311 from an account belonging to his step-father.

The initial thefts emboldened Miller to become even more reckless. He took out consumer loans in the names of two relatives and an unrelated victim without their knowledge and employed similar techniques to divert funds from CDs, IRAs and savings and checking accounts belonging to numerous unrelated people.

Miller began playing online poker in 2001, about a year after joining First Tennessee as a teller. The online poker eventually led to casino gambling, betting on sports, and finally playing Daily Fantasy Sports, an online game that marked "the end" for Miller, his lawyer, Johnathan Minga of Herndon, Coleman, Brading & McKee, said in court papers.

"It was a perfect tool to fuel his compulsive gambling addiction. He loved sports and was a gambling addict, and DFS had both," he wrote.

Miller began playing DraftKings in 2014 and within a year lost $96,000. He fared even worse on FanDuel, another DFS site, losing approximately $605,000.

DAY OF RECKONING
Minga urged the court to be lenient with Miller, saying his severe gambling disorder, which went undiagnosed, diminished his capacity and judgment. "As ridiculous as it likely sounds now in the aftermath, he had every intention of paying back every single dollar he took from all sources," he wrote in the sentencing memorandum. "Even the very day he was confronted and terminated, he had money to make a deposit into one of the customer's accounts."

Miller faced up to 63 months in prison but his willingness to cooperate with law enforcement authorities helped reduce his sentence to 36 months. He "spilled his guts," Minga said, explaining that he voluntarily handwrote a confession that detailed the accounts he had used and the amounts he had taken when First Tennessee corporate security came into the branch on his "day of reckoning."

"He saved First Tennessee Bank and law enforcement uncountable hours in trying to recreate his steps," Minga reminded the judge.

$1M PLUS IN RESTITUTION
In addition to serving 36 months in jail, Miller will be subject to five years of supervised release and will have to pay more than $1 million in restitution to First Tennessee Bank, his mother and step-father and the IRS.

He was ordered to pay First Tennessee Bank $844,255 to reimburse it for the money it paid to refund its customers. The amount also included money Miller stole directly from the bank.

"First Tennessee Bank, itself a victim of the fraud, made all of its customers whole," a spokesman for First Tennessee Bank, said in a statement.

Miller will also have to repay his mother and step-father $81,014, which was not reimbursed by the bank, according to court documents.

He also owes the IRS $161,018 in unpaid taxes. From 2013 to 2016, he significantly understated his joint taxable income.

"I was impressed that he took immediate and full responsibility for his actions and began intensive rehabilitation for his personal issues," Minga said in an email. "He expressed sincere regret for the impact his decisions had on everyone involved, including the bank, the bank customers, and especially his family."

Miller started serving his sentence in April.