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Saturday, July 31, 2010

Bank fire, missing cash may be linked in North Carolina

The Rowan County Sheriff’s Office is investigating a report of embezzlement from the Enochville Dollar General Store, located directly beside Community One Bank. A $5,111 cash bank deposit went missing sometime between July 3 and July 6, and was reported Wednesday by Roger Rickard, loss prevention supervisor of Dollar General. The Community One Bank suffered damage from a fire to its deposit box July 6, but no records or cash were destroyed. Richard “Rick” Jurgenson, vice president and director of security for Community One Bank in Enochville, said the July 6 fire was surrounded by “unusual circumstances. ”Capt. John Sifford of the Rowan County Sheriff’s Office said the embezzlement is under investigation.
“One of their (Dollar General’s) deposits was not found at the bank,” Sifford said. “It was supposed to have been made, but was not in the drop box.”Sifford said the embezzlement and fire could be related, and the Sheriff’s Office is “certainly exploring the possibility.”

Wednesday, July 28, 2010

Connecticut Woman Receives Suspended Sentence in Embezzlement Case

Laura Smith, wife of longtime First Selectman Richard Smith, has been spared jail time on a charge of first degree larceny in the embezzlement of $47,983 from the local Liberty Bank branch.Middlesex Superior Court Judge Patrick Clifford Friday gave Smith, 46, a suspended sentence of eight years in prison. The sentence also includes five years on probation, and a requirement for 225 hours of community service.Smith was arrested last November after a police investigation of the embezzlement of $47,983 from accounts at the Liberty Bank branch on Main Street. Smith had worked as a teller at the bank. The police investigation began in February 2009 after bank officials reported the missing funds. Smith has paid back the embezzleed funds.Police reports in the case indicated Smith had a severe gambling problem, and had lost $408,887 at the Mohegan Sun Casino over the past decade, with about $10,000 in earlier losses at the Foxwoods Resort Casino. Police believe the embezzled funds were used to cover gambling debts.The sentence from Clifford also requires Smith to continue to receive counseling for her compulsive gambling problem through a program at Middlesex Hospital, and to stay out of the Mohegan Sun and Foxwoods casinos. Smith, who now works at an area Dunkin Donuts, was also ordered to maintain verifiable employment.

Arcata, California bank employee arrested on charges of embezzlement, elder abuse

A Northern Redwood Federal Credit Union employee was arrested Tuesday for allegedly embezzling more than $100,000. Elliot Shane McCarl, 32, of McKinleyville was booked into the Humboldt County jail on suspicion of embezzlement and elder abuse after an audit and an investigation was completed this week, according to an Arcata Police Department press release. The credit union first discovered discrepancies in the account balances of at least five customers around July 5, and immediately launched an audit and then notified APD on July 9, said Detective Sgt. Todd Dokweiler. McCarl allegedly transferred money from about five bank customer accounts to his personal account over a roughly one-year period. ”Typically, I think bank employees are trustworthy,” Dokweiler said, and it was other bank employees who noticed the discrepancies and looked into them. During the audit, the credit union went over all McCarl's transactions -- it appears that McCarl allegedly picked people who seemed “inattentive in their banking practices” or were elderly, Dokweiler said. McCarl has worked for the credit union for nearly three years, according to the APD. His bail was set at $119,000. The manager of Northern Redwood Federal Credit Union, which is located on Giuntoli Lane in Arcata, was unavailable for comment.Dokweiler said he was unsure if the bank would be investigated for the incident, but said such an investigation would not be through the APD.

Tuesday, July 27, 2010

South Dakota Loan officer accused of stealing client's identity

A former commercial loan officer who allegedly fled the country after admitting to identity theft has been indicted in Minnehaha County.John Robert Delay, 36, of Dell Rapids, will face two counts of grand theft embezzlement, five counts of fogery and two counts of identity theft.An affidavit filed with his arrest warrant states that Deay attempted to sell an Egan man a loan from Great Western Bank in 2008. Delay was a loan officer with Great Western at that time.The man gave Delay copies of his income tax returns, and he allegedly used the information on them to secure two $14,000 loans without the victim's permission. He then deposited the money in his own account and used it to pay bills, the affidavit states.Delay spoke with detectives on May 10 and admitted the theft, the affidavit says. On May 11, the arrest warrant was issued.Between then and July 7, when deputies from the Minnehaha County Sheriff's Office arrested him at the Empire Mall, prosecutors believe he was in Canada.His bond was set at $1,000 cash last week on the condition that he relinquish his passport.

Former Eau Claire bank employee enters plea in embezzlement case

A former bank employee, accused of embezzling around $22,000 from his employer, has reached a plea agreement.Kenneth Hamberger of Green Bay, worked at the Citizens Community Bank in Eau Claire for 15 years. He was responsible for preparing bills on cars, homes and other property the bank financed or repossessed.Hamberger told officers he would pocket some of the money for himself from transactions, and use it on his own expenses, such as child support. He also said he has a drinking problem and was, "...probably drunk most of the time he was at work."Authorities say he has repaid most of the money he embezzled, before entering a plea deal on Monday. He pleaded guilty to felony theft from a financial institution and two misdemeanor theft charges. Hamberger will serve 75 days in jail for the two misdemeanors. For the felony charge, a deferred prosecution was ruled, which means the charge will be dropped if he completes orders from the court for 1.5 years. Besides paying the money back, the agreement also requires Hamberger to complete 120 hours of community service.

Saturday, July 24, 2010

New York ex-bank computer tech gets prison in $1M scam

A computer technician who used a three-month job at a New York bank as a launching pad for almost a decade of theft from charities has been sentenced to five to 15 years in prison.Adeniyi Adeyemi (ah-DEN'-ee ah-deh-YEM'-ee) told a judge Wednesday he felt "shame, guilt and remorse" for his scheme.He admitted last month to stealing 2,000 bank employees' identities in 2001. He used their IDs for years to siphon about $1 million from charities that released banking information to ease donations.He transferred money from the charities' accounts to accounts he'd opened under stolen identities.Adeyemi pleaded guilty to charges including grand larceny. The 27-year-old Nigerian immigrant will be deported after serving his sentence. The range reflects possible credit for good behavior.

Myrtle Beach, South Carolina Man Pleads Guilty to Conspiracy to Commit Bank Fraud

United States Attorney William N. Nettles stated today that Gary Albert Hager, age 58, of North Myrtle Beach, SC, pled guilty today in federal court in Florence to conspiracy to commit bank fraud, a violation of Title 18, United States Code, Section 1349. United States District Judge Terry L. Wooten of Florence accepted the plea and will impose sentence after he has reviewed the presentence report which will be prepared by the U.S. Probation Office.Evidence presented at the change of plea hearing established that Hager was employed as a loan officer for J P. Morgan Chase Bank in Myrtle Beach, SC. As such, he became acquainted with Jeremy Eason, a mortgage broker employed by Dunes Mortgage. Eason arranged for the separate sale of four properties in the Myrtle Beach area. The sales generated mortgage loans submitted by Hager in the amount of $3,300,000.00 to J. P. Morgan Chase and Plantation Federal. The loan packages contained applications with false information, false HUD 1 Settlement Statements, as well as inflated appraisals. By fraudulently representing to the banks that the properties were valued at more than their actual value, the banks lent excessive funds. Hager and others were then able to receive excess proceeds at closing to divide amongst themselves, unbeknownst to the banks. Hager received approximately $25,000.00 in kickbacks from Jeremy Eason from August to October 2008. Mr. Nettles stated the maximum penalty Hager can receive is a fine of $1,000,000.00 and/or imprisonment for 30 years, plus a special assessment of $100.00.The case was investigated by agents of the Federal Bureau of Investigation. Assistant United States Attorney William E. Day, II of the Florence office handled the case.

Friday, July 23, 2010

Topekan Accused Of Embezzlement Misses Sentencing

A Topeka woman who pleaded no contest to embezzling funds from a Topeka bank was a no-show at her sentencing and now has a warrant for her arrest.The Shawnee County District Attorney’s office says Aubrie Angel committed the crimes in May and June of last year, embezzling from Capital Federal Bank.Court documents show she had also faced a theft charge from the Topeka Target store, but that charge was dismissed when she made her plea on the embezzling charge.Angel’s attorney appeared for her sentencing last Friday, but she didn’t.There is now a warrant for her arrest.Ironically, Kansas law normally specifies probation for persons convicted in what is called a level-8, non-person felony.

Boise, Idaho woman admits embezzling $25K from Wells Fargo customers

A former Wells Fargo branch manager has admitted to embezzling more than $25,000 from the accounts of three bank customers.Julie Dempsey, 41, of Boise, pleaded guilty Tuesday in federal court to embezzlement of bank funds, according to the U. S. Attorney’s Office.Dempsey worked at the Mountain Home branch of Wells Fargo Bank.Prosecutors say from Sept. 2009 to April 2010, Dempsey withdrew funds from the three accounts and deposited the money into accounts she had created. She then withdrew the funds from those accounts.Sentencing is set for Sept. 30. Dempsey faces up to 30 years in prison, a fine of up to $1,000,000, and five years of probation.The case was investigated by the U.S. Secret Service.

Tuesday, July 20, 2010

Salida, Colorado bank sues insurance company

A trial has been set for a lawsuit in which High Country Bank of Salida alleges an insurance company reneged on a purported obligation to pay a claim stemming from an embezzlement.The bank alleges Kansas Bankers Surety Co. wrongfully refused to pay a $319,566 claim that the bank contends was due under terms of a fidelity bond the company issued to the bank in 2005.The alleged bank loss was from the 2005-06 embezzlement by Marilea J. Rans, the former bank chief loan officer.She was sentenced in 2008 to three years in federal prison for the crime.Kansas Bankers Surety of Topeka is part of the financial empire of investor Warren Buffett.A fidelity bond is insurance for losses caused by dishonest acts of an employee of a policyholder.Kansas Bankers contends it is not liable for the alleged losses of the bank. The bank disputes the company contention that the bank did not meet legal deadlines to file its insurance claim and its lawsuit.
Senior U.S. District Judge Richard Matsch in Denver set the case for jury trial in December in Denver.
He denied the Kansas Bankers' request for him to decide the case based solely upon documents and arguments filed by both sides.

Wednesday, July 14, 2010

FBI probes Logan, Ohio bank theft

Local law enforcement is referring a Logan bank embezzlement case to the FBI.This case began to slowly unfold in early May when a customer reported a banking error at Century National Bank. After an internal investigation, Manager Doug Wells notified Logan police of an internal theft on June 17. Following up on a news tip, The Logan Daily News requested the report last week and police made it available July 16.
Back in May, Wells examined the document presented by the customer and confirmed there appeared to be a discrepancy on the part of the bank. “There was a procedural error that also gave the appearance that monies were taken from an account without authorization,” states the police report. The bank staff later interviewed the individual who handled the transaction. Reportedly, the person’s answers were not always consistent. The Logan Daily does not print the name of a suspect unless that person has been arrested or charged, and at this time no one has.Century National Bank terminated the employee for failing to follow correct procedure. “A subsequent banking audit found that this employee might have been involved in additional unauthorized transactions,” according to the police report.The Logan Daily could not confirm the amount of money stolen, and Logan Police Chief Aaron Miller noted Monday, “A final figure is not there yet.” But Miller would say this: “With the amount taken, the services of the FBI were requested.” The FBI review is being conducted by an agent in the Athens office.Legally, if a person walks in off the street and “strong-arms” a bank (robs by physical force or coercion), taking any amount, it is a felony. However, if an employee takes money, up to $500, it is petty theft. Any amount above that is a felony, according to Miller.
FBI spokesman Special Agent Mike Brooks commented Monday, “All we can say at this time is that we received a referral from the Logan Police Department concerning a possible embezzlement at the Century National Bank in Logan.”Speaking in general terms, Hocking County Assistant Prosecutor Bill Archer said that if the FBI declines an embezzlement case on the federal level, there are theft provisions in the Ohio Revised Code that would allow a county to prosecute such a case.Century National Bank has 16 locations in Hocking, Athens, Perry, Muskingum, Coshocton and Tuscarawas counties. It is a division of The Park National Bank. Century National is a member of the FDIC, which provides basic insurance coverage for deposit accounts.Logan branch Manager Doug Wells could not be reached for comment.Beth Stillwell, marketing administrative officer for all of Century National’s banks, said, “We can’t share anything right now as there is an ongoing investigation.”
The FBI’s review of a Logan bank embezzlement case has become an official investigation.

“The FBI has opened an investigation based upon a referral from the Logan Police Department,” FBI spokesman Special Agent Mike Brooks said Monday. “The investigation does concern the Century National Bank.”In early May, a customer reported a banking error that led to an internal investigation. Century National Bank Manager Doug Wells then informed Logan police of the embezzlement in June. “There was a procedural error that also gave the appearance that monies were taken from an account without authorization,” states the police report.Century National Bank terminated an employee for failing to follow correct procedure. “A subsequent banking audit found that this employee might have been involved in additional unauthorized transactions,” according to the police report.The Logan Daily News is not printing the name of the suspect unless that person is arrested or charged, and at this time no one has.Brooks stated Monday that, per FBI policy, he cannot say what is being investigated in relation to Century National Bank. Neither Brooks, the Logan police nor the bank is saying how much money was stolen. At the time that the case was referred to the FBI, Logan Police Chief Aaron Miller said there wasn’t a final dollar amount tallied, but added, “With the amount taken, the services of the FBI were requested.”While the FBI involvement has now reached the status of an official investigation, it has yet to be referred to the U.S. Attorney’s Office. A spokesman there said Monday that the office was not aware of the case.Century National Bank has 16 locations in Hocking, Athens, Perry, Muskingum, Coshocton and Tuscarawas counties. It is a division of The Park National Bank. Century National is a member of the FDIC, which provides basic insurance coverage for deposit accounts.

Saturday, July 10, 2010

Ohio Banker sentenced

A Mogadore woman was sentenced to two years in prison Wednesday for the theft of $143,466 from two Summit County banks.Patricia Lynn Davis-Boarman, 52, was sentenced by U.S. District Judge Solomon Oliver Jr.Authorities say Davis-Boarman took the money while working in management positions at Falls Savings Bank and North Akron Savings Bank between 2001 and 2009. Investigators say she obtained fraudulent loans in the names of bank customers and took the cash. One of the victims was her mother-in-law, authorities said.


Norma Vargas, 41, a former operations supervisor of International Bank of Commerce, has been sentenced to 24 months in prison for defrauding her former employer of more than $190,000 during the last two years of her employment, United States Attorney José Angel Moreno announced today. Vargas pleaded guilty Feb. 9, 2010.Convicted of fraud after pleading guilty in February 2010, Vargas was sentenced today by U.S. District Judge Micaela Alvarez to 24 months in federal prison without parole to be followed by a three-year-term of supervised release. The court further ordered Vargas to pay restitution to the bank in the amount of $148,203.80. In handing down the sentence, Judge Alvarez noted that Vargas didn’t steal the money out of necessity, but rather she lived beyond her means and stole from the bank to fund her lifestyle.
IBC is a federally insured depository bank headquartered in Laredo, Texas, with branches in Texas and Oklahoma. As the operations supervisor, Vargas was responsible for overseeing the utility accounts payable of all IBC branches. The accounts included an electricity utility bills account and a phone and data utility accounts payable. Vargas took more than $190,000 from the two utility accounts by diverting funds from the bank’s accounts into her personal savings account beginning in October 2007 until the scheme was discovered in early September 2009. Under the terms of her plea agreement, Vargas agreed to forfeit the bank’s unrecovered amount of $182,115.87. Vargas also entered into a written stipulation with the government that she would be prohibited from further participating in the affairs of any financial institution affiliated with the Federal Deposit Insurance Corporation (FDIC), the agency of the federal government that insures the deposits of member banks against loss up to $100,000.Vargas remains in custody pending her transfer to a U.S. Bureau of Prisons facility to be designated in the near future.The case was investigated by agents from the United States Secret Service and was prosecuted by Assistant United States Diana Song.

Former Houston Bank Branch Manager and an Auto Dealer Convicted of Defrauding Bank of Millions in a Check Kiting Scheme

A former bank branch manager and an auto dealer have pleaded guilty to conspiring to defraud a Houston-area bank of more than $2.5 million through a check kiting scheme, United States Attorney José Angel Moreno announced today. Houston area residents Matthew Robbins, 32, a former Wachovia Bank branch manager, and Thin Viet Tieu, 45, an auto dealer and customer of Wachovia Bank, pleaded guilty to conspiracy to commit bank fraud arising from a check kiting scheme before United States District Judge David Hittner at a hearing this morning.At today’s hearing, Robbins and Tieu admitting working together to defraud Robbins’ former employer, Wachovia Bank, of $2,500,000 between June 1, 2009, and Aug. 31, 2009. As a bank branch manager, Robbins was responsible for approving the sale of official checks drawn on the account of Wachovia Bank, in exchange for cash or a check given to Wachovia Bank by its customer. Official checks are equivalent to cashier’s checks, in which the bank certifies the funds are available to pay the check from funds drawn on the bank’s account.Despite having been ordered by the bank’s president not to allow Tieu to purchase official checks from Wachovia Bank, Robbins, nonetheless, instructed his employees to allow Tieu to purchase official checks from the bank with business checks drawn on the accounts Tieu had at other banks. Tieu, in turn, deposited the official checks into business accounts he maintained at banks other than Wachovia. At Tieu’s request, Robbins held the business checks issued by Tieu for several days. In the meantime, Tieu withdrew the funds and used them to operate his business and for personal expenses. When Robbins eventually attempted to negotiate Tieu’s business checks payable to Wachovia Bank, the checks were returned due to insufficient funds. In exchange for his participation in the conspiracy, Robbins bought a vehicle from Tieu for a price significantly below the market value of the vehicle. The investigation leading to the charges was conducted by the FBI in 2009 after Wachovia discovered the theft. Both Robbins and Tieu face up to 30 years in prison without parole and fines up to $1,000,000 as well as having to pay restitution to Wachovia Bank. Judge Hittner has set sentencing for Sept. 13, 2010. Robbins and Tieu have been permitted to remain on bond pending sentencing.This case is being prosecuted by Assistant United States Attorney Vernon Lewis.

Monroe County, Pennsylvania Woman Admits to Scheme to Access and Steal from Bank Accounts

Dennis C. Pfannenschmidt, United States Attorney for the Middle District of Pennsylvania, announced that a Monroe County woman pleaded guilty today before Senior U.S. District Court Judge William J. Nealon to participating in a scheme with others to access and unlawfully obtain more than $60,000 from accounts in a New Jersey bank.
Pfannenschmidt stated that Christine Fahmy, age 22, of Sciota, Pennsylvania, admitted to committing the offense in 2008 and early 2009. Fahmy admitted that when she was a teller at J.P. Morgan Chase and Company in Hackettstown, New Jersey, she accessed 12 customer account profiles and sold them to two individuals in Monroe County. As part of the scheme, Fahmy’s two confederates, Lavan Blair and Jonnell Gantt, used the customer profile information to have false identification documents made and used to access the accounts to obtain the money.
Blair and Gantt both previously pleaded guilty to bank fraud and attempted bank fraud as aiders and abettors. They are both awaiting sentencing.
Fahmy was charged in an information filed by the United States Attorney’s Office in April 2010. Fahmy’s charge resulted from an investigation conducted by the Federal Bureau of Investigation (FBI) and Hackettstown, New Jersey, Police.
Pfannenschmidt noted that as a result of the guilty plea, Fahmy faces up to 10 years in prison and a $250,000 fine. Judge Nealon scheduled sentencing for September 8, 2010.
Pfannenschmidt noted that the case is being prosecuted by Assistant U.S. Attorney Francis P. Sempa.

Bank of Colorado Officer Sentenced to Federal Prison for Fraud

Patricia Cabano, age 56, of West Sacramento, California, a former bookkeeper and operations manager of the Bank of Colorado in Craig, Colorado, was sentenced today by U.S. District Court Judge John L. Kane to serve 40 months in federal prison for bank fraud, U.S. Attorney David Gaouette and FBI Special Agent in Charge James Davis announced. Following her prison sentence, Cabano was ordered to serve five years on supervised release. Judge Kane also ordered the defendant to pay restitution totaling $535,530.67 to the victims of the fraud. Cabano is also not allowed to work in the financial industry again. The defendant appeared at the hearing free on bond, and was ordered to report to a Bureau of Prisons facility within 15 days of designation.Patricia Cabano was indicted by a federal grand jury in Denver on May 6, 2009. She pled guilty before Judge Kane on April 5, 2010. She was sentenced today, June 18, 2010.According to the stipulated facts contained in the plea agreement, Cabano, as head bookkeeper and later operations officer at the Bank of Colorado, used her position, knowledge of operations, and her largely unsupervised access to customers’ accounts to facilitate her fraud. Over the period of July 1998 through November 2002, Cabano abused her position by making numerous unauthorized electronic transfers from unsuspecting customers’ accounts to her own accounts and the accounts of customers she favored as well as some of her family members. The holders of the accounts that benefitted from the scheme were able to withdraw funds that were not rightfully theirs.The defendant usually made transfers from one account to another, but she also made transfers to and from more than one account at a time as part of one transaction. She transferred funds in amounts consistent with transactions typically made in the particular accounts she was using, so as not to draw attention to the transactions. She frequently performed several transactions in one day, sometimes manipulating several customers’ accounts to conceal the fraud, even if she were not funneling additional funds that day to an account of a beneficiary. Cabano was aware that account holders would be unlikely to detect unauthorized manipulations of their accounts if they didn’t examine their monthly statements, or if their monthly statements appeared to be correct. To perpetuate her fraud and avoid detection, Cabano developed elaborate means of re-crediting those accounts before the end of their statement cycles to conceal the unauthorized transfers, and creating and distributing false monthly statements. She also back-dated certain electronic entries to conceal her fraud. If a customer complained or inquired about the unauthorized transfer, the Bank would refer customers to the defendant to respond to the inquiries and complaints.“People put their trust in banks, and when a bank employee steals from customers, it reduces the confidence people have in their financial institutions,” said U.S. Attorney David Gaouette. “This is one of the more complicated internal fraud cases with a single suspect that the FBI has investigated in the Denver Division,” said FBI Special Agent in Charge James Davis.This case was investigated by the Federal Bureau of Investigation (FBI).Cabano was prosecuted by Assistant U.S. Attorney Linda Kaufman.

Springfield, Virginia Man Pleads Guilty to Bank Fraud

Sissaye Gezachew, 32, of Springfield, Virginia, pleaded guilty yesterday to using his position at United Bank to assist a conspirator who stole more than $17 million from the financial institution.Neil H. MacBride, United States Attorney for the Eastern District of Virginia; Shawn Henry, Assistant Director in Charge of the FBI Washington Field Office; and Rebecca Sparkman, Special Agent in Charge of the Internal Revenue Service Criminal Investigation’s Washington, D.C., Field Office, made the announcement after the plea was accepted by United States District Judge Leonie M. Brinkema. Gezachew faces a maximum penalty of 30 years in prison for conspiracy to commit bank fraud when he is sentenced on Sept. 3, 2010.In a statement of facts filed with his plea agreement, Gezachew assisted Osama El-Atari, who defrauded United Bank of more than $17 million in fraudulent loans from 2007 until 2009. Gezachew worked as an assistant vice president-senior credit analyst at United Bank during the time frame of the scheme. Gezachew admitted that he assisted El-Atari by supplying him with fraudulent documents, including a fraudulent tax return, to submit to United Bank in connection with El-Atari’s loans.This case was investigated by the FBI Washington Field Office and the Internal Revenue Service Criminal Investigation Division. Assistant United States Attorneys Jonathan Fahey and Jack Hanly are prosecuting the case on behalf of the United States.

Federal case says bank employees played key roles in Charlotte, North Carolina-area fraud schemes

Bribed bank employees were key to the fraudulent mortgages taken out by members of cell No. 2, prosecutors allege in the indictment filed last week.Bribes were not paid to approve any loans. Rather, they were paid to provide false information or verifications for loan applications, usually to banks the accused didn’t work for, prosecutors allege.That part of the operation was led by Landrick McClain, a Maryland resident and owner and chief executive of Credit Risk Re Ltd., a financial-services firm based in Washington, the indictment says.Vic Henson, who was branch manager for Bank of America’s Steele Creek branch, was paid $38,000 in the fall of 2007 for writing a bogus $5 million letter of credit for an unidentified company involved in the scheme, the indictment says.That November, Jamilia Brown, an assistant manager at BofA’s Cotswold Branch, produced another bogus letter of credit and was paid $55,000, prosecutors say.
Bonnie Ramey, an employee at Wachovia’s Ballantyne branch, was paid $9,000 about the same time for forging a letter of credit, the indictment alleges.Another Wachovia employee, Danyelle Eason, is accused of accepting smaller bribes — around $150 — to confirm that “straw buyers” set up by the cell had accounts with balances of $170,000 to $1.5 million to enable the cells to complete some of their mortgage schemes, the indictment says. She received a total of more than $1,000, according to court documents.Neither the indictment nor other documents filed so far in the mortgage investigation list either BofA or Wachovia as being a target for any fraudulent loans.The only bank employee alleged to have profited from fraudulent mortgages taken from her employer is Linda Clarke, who worked for First Tennessee Bank’s Horizon Home Loans division.The indictment says in the summer of 2007 she and her husband received $187,000 in proceeds from a fraudulent $1.4 mortgage issued by First Tennessee.Clarke and her husband helped provide false information for the loan application, the indictment alleges.The bank lost almost $1.5 million on two bogus mortgages that totaled $2.83 million, court documents say.

Peabody, Massachusetts bank teller sentenced in fraud case

A former bank teller from Peabody has been sentenced to nearly three and a half years in prison for stealing customer account information that led to the theft of more than $330,000.Federal prosecutors say 26-year-old Jeffrey Gautreaux pleaded guilty to multiple counts of bank and identity fraud.Authorities say while work as a teller at a Bank of America branch, Gautreaux used his access to bank customer data to steal customer names and account information from November 2004 to February 2006. He then sold the information to someone who did not work for the bank, usually for $2,000 per account.Gautreaux was also sentenced to three years of probation and ordered to pay more than $270,000 in restitution.The thefts were first noticed by a customer.

Thieving Manager Was No Good Samaritan in Cincinnati

The former president of Good Samaritan Employees CU was sentenced yesterday to 33 years behind bars for embezzling more than $234,000, which forced the tiny credit union into liquidation.Anne Bryson, who ran the one-time $2.5 million credit union from 1998 to its demise in 2005, pleaded guilty to using the credit union’s funds for her living expenses by issuing credit union checks for her own use.

New York Mellon Bank IT Worker Charged In $1Million Fraud

A previous IT staffer with Bank of New York Mellon pleaded guilty to theft responsive information belonging to 2,000 bank staff and then using that data to take further than $1 million from charities.
Adeniyi Adeyemi, 27, had worked as an agreement computer technician at Bank's Manhattan headquarters, and data he supposedly stole belonged above all to colleague in the bank's IT department.He pleaded guilty to stealing, currency wash and PC tampering charges in New York City Criminal Court, the New York District Attorney's Office said in a report.More than an eight-year stage, Adeyemi stole a lot than $1.1 million from charities by shift funds from charities' bank accounts into false accounts he'd system using private information of his previous co-workers, prosecutors say. He "input the charities' banking particulars, as well as account and routing numbers, to set up wire transfers on E*Trade and loyalty sites from the charities' account to his fake accounts, and remove the stolen funds or transferred them to a second layer of fake accounts," the quarter attorney's office said in its press release.

Feds say auditor may have let fraud continue at Connecticut credit union: Lawsuit alleges he lacked training for review of NL institution that collapsed

A federal agency is alleging that an unqualified auditor may have allowed a multimillion-dollar fraud at the New London Security Federal Credit Union to fester for years before the financial institution suddenly collapsed two years ago.The board of the National Credit Union Administration, the agency that regulates federal credit unions, said in an amended lawsuit filed in U.S. District Court that Robert Shutsky of Preston, an employee of Ed Lorah & Associates, performed audits for the New London credit union. For most of those years, according to the suit, Shutsky was employed by Beller, Shepatin & Co., a New London accounting firm purchased by Lorah in September 2007."Shutsky was unqualified and lacked the proper and necessary training and knowledge to perform auditing and review services," according to the suit. Shutsky did not respond to two telephone messages seeking comment. In an answer to the complaint filed last week, attorneys Marisa Lanza and Andrew F. Pisanelli denied the allegations. But the attorneys acknowledged Shutsky joined Lorah when the New London accounting firm bought Beller Shepatin, and that he was the auditor for the credit union. Lorah had previously said his company never performed an audit on behalf of the credit union. "I stand by my previous comment," he said in an e-mail Wednesday.But the NCUA said in its amended suit that the credit union's final audit, in October 2007, came about a month after Lorah acquired Beller Shepatin.bIt contends that Lorah's firm, as successor to Beller Shepatin, is responsible for $9.7 million in deposit insurance losses that the agency incurred when the New London Security Federal Credit Union was declared insolvent in July 2008 after a routine NCUA examination. The agency also said it is trying to recover $570,000 on behalf of uninsured shareholders in the credit union.In an October 2009 report by the Office of Inspector General, the NCUA blamed the credit union's failure on a massive embezzlement scheme by longtime New London stockbroker Edwin F. Rachleff, who served as the financial institution's investment adviser. Rachleff, who was accused in the report of creating a dummy account and fictional investment statements, committed suicide the day the credit union was shut down. The NCUA said in its suit that Rachleff's scheme went on far longer than it might have if auditor Shutsky or his employees, Beller Shepatin and Ed Lorah, had done their jobs properly. Among the NCUA's allegations were that Shutsky failed to request independent confirmations of accounts being audited and neglected to question inconsistencies in account statements. "Had Beller Shepatin and Mr. Shutsky performed proper audits and reviews, the credit union would have uncovered the fraudulent investment account years sooner," according to the suit. In addition to the suit against Beller Shepatin, Shutsky and Lorah, the NCUA earlier this year filed suit against Wells Fargo Advisers LLC, successor to the brokerage houses A.G. Edwards and Wachovia Securities, companies for which Rachleff worked. It also has sued Rachleff's estate, which had less than $40,000 in assets. Shutsky is being sued for professional malpractice, while Lorah and Beller Shepatin are accused in the NCUA's complaint of professional malpractice and breach of contract.

Thursday, July 8, 2010

Fond du Lac Bank employee accused of embezzlement

A former National Exchange Bank employee has been charged with allegedly stealing $12,000 from the 130 S. Main St. business. Anna M. Tolvstad, 34, of 507 Allen St., is free on a $500 signature bond after she appeared in Fond du Lac County Circuit Court Tuesday. On Jan. 7, a Fond du Lac Police Department detective interviewed the vice president of operations at National Exchange Bank. The employee said the business became aware of the theft on Dec. 31 when another person working Tolvstad’s job in the vault noticed a $10,000 discrepancy while counting the cash, according to the criminal complaint.When Tolvstad came back to work in January, she allegedly admitted to stealing $12,000 between June and December of 2009. She also wrote a statement about the theft, according to the complaint. She then paid back the $12,000, according to the complaint. A preliminary hearing is scheduled for July 16.

Thursday, July 1, 2010

Brunswick, Ohio couple accused of embezzlement

A Brunswick couple accused of stealing almost $1 million from National City Bank over several years has been indicted by a federal grand jury on bank fraud. Rebecca Warden, 34, and Steve Warden, 35, were the subjects of an FBI investigation, the U.S. Depart­ment of Justice reported.
Rebecca Warden was employed as a teller for the bank between 1995 and March. Starting in 2006, Steve Warden periodically would visit his wife at the Strongsville bank branch and pretend to conduct legitimate transactions. Rebecca Warden would give her husband cash from her teller drawer, their indictment alleges.
The indictment also alleges Rebecca Warden would use National City’s cash to issue bank checks and money orders payable to her husband’s creditors. She is accused of creating fraudulent transactions on the bank’s teller system to hide the embezzlement.
The DOJ reported National City lost $923,471 due to the Wardens’ alleged transactions.

Former Dothan, Alabama bank exec faces federal theft charge

A former Dothan bank executive was recently charged with stealing from his employer of nearly 20 years. Federal court records show James E. Goldsborough, 70, was recently charged with a criminal bill of information of felony theft, embezzlement or misapplication by a bank officer.
Federal court records indicate Goldsborough was employed as the president and later executive vice president in Dothan of PeoplesSouth Bank. The alleged theft happened over an 18-year period from 1991 to 2009 in Houston County.
Records show Goldsborough has been charged with the misapplication of money, funds, credits, securities and other things of value worth in excess of $1,000 from PeoplesSouth Bank.
Assistant U.S. Attorney Joe Schiff said he could not comment on the theft charge against Goldsborough except to say that Goldsborough has a court date on July 19 for an arraignment and a consent plea hearing. Schiff said he could not reveal how much money was stolen, but that more details would be released after the July court hearing.
Dothan attorney Wade H. Baxley, who represents Goldsborough, said his client no longer works at the bank. Baxley said he could not make any other comments about the pending charge against his client.
And though unrelated to Goldsborough’s arrest, another former PeopleSouth Bank employee is also charged with stealing from the bank.
Houston County Sheriff’s deputies arrested Karen Hunter L. Watkins, 42, of Napier Field Road, on Tuesday, on a charge of first-degree theft of property by deception. Specifically, she is charged with stealing $36,509 from the bank.
Houston County Sheriff’s Capt. Antonio Gonzalez said the charges stemmed from her making withdrawals from bank accounts that did not belong to her. He said the business reported the theft to the sheriff’s office last week.
Watkins was taken to the Houston County Jail and held on a $5,000 bond.
James E. Goldsborough, age 70, pled guilty today before United States Magistrate Judge Terry F. Moorer to a one-count felony information charging him with embezzling funds of PeoplesSouth Bank (“PSB”), in violation of Title 18, United States Code, Section 656, U.S. Attorney Leura G. Canary announced.

According to the plea agreement, Goldsborough worked for PSB in Dothan since 1992—first as president and, later, executive vice president. In these positions, Goldsborough had the authority to approve loans up to $25,000.
Goldsborough began embezzling in approximately 1992. He accomplished this by opening a bank account in the name of the fictitious entity. He would then approve loans to fictitious borrowers in amounts of $25,000 or less, deposit the loan proceeds in the account, and use the money either for personal expenses or to repay previously obtained fraudulent loans. Goldsborough would occasionally receive the loan proceeds in cash, falsely representing to the teller that he intended to personally deliver the funds to the borrower. Goldsborough classified the loans as commercial loans because there was no minimum monthly payment—the only requirement was that the loan be paid in full when due. When a loan would become due, Goldsborough would arrange for a new fictitious loan and use those funds to pay the loan that was due. Goldsborough also used his knowledge of PSB's security procedures to avoid certain anti-fraud measures.
At the time Goldsborough's embezzlement scheme was detected in August 2009, PSB's records show that approximately 92 fictitious loans were outstanding with a total principal balance of approximately $1,850,999.23. However, under the plea agreement, Goldsborough reserves the right to argue that the amount is less for purposes of computing his sentence and the amount of restitution.
When he is sentenced this fall by United States District Judge W. Keith Watkins, Goldsborough faces a statutory maximum sentence of 30 years’ imprisonment, a term of supervised release of no more than five years, a fine of up to $1,000,000 (or, if greater, twice the loss to PSB), and an order of restitution. Judge Moorer released Goldsborough on a $25,000 unsecured bond pending sentencing.
The case was investigated by the Federal Bureau of Investigation and was prosecuted by Assistant U.S. Attorney Andrew O. Schiff.
A Dothan banker who pleaded guilty to a scheme of creating fictitious loans that spanned almost 20 years was sentenced to 36 months in federal prison on Thursday.

James (Jimmy) Goldsborough was sentenced by U.S. District Judge William Keith Watkins at the federal courthouse in Montgomery. He pleaded guilty to the charge of embezzlement by means of misapplication of funds by a bank officer or employee.

Goldsborough, 71, was arrested in June and accused of creating well more than 100 fake loans as president and then executive vice president of PeopleSouth Bank in Dothan. According to court records, Goldsborough’s scheme was detected in August of 2009. At that time, 92 fictitious loans remained outstanding totaling more than $1.85 million.

Prosecutors contended Goldsborough began the scheme in 1992 by opening a bank account in the name of a false company, Consumer Financial Services. He then created a fictitious owner of the account and would then approve loans to fictitious borrowers in amounts of $25,000 or less, deposit the loan proceeds in the CFS account, and use the money either for personal expenses or to repay previously obtained fraudulent loans. The scheme is said to have gone on for 17 years.

Prosecutors originally sought a sentence of 51 months, but allowed the court to take Goldsborough’s age into account during sentencing.

The maximum penalties for the embezzlement charge was not more than 30 years in prison, a fine of not more than $1 million, or not more than twice the gross gain to the defendant or gross loss to the victim and not more than five years supervised release.

Former Panama City, Florida Bank Employee Sentenced for Embezzlement

Pamela C. Marsh, the United States Attorney for the Northern District of Florida, announced that former bank employee Kelawanoia W. McKay, 34, of Panama City, was sentenced Wednesday to 30 months in federal prison for embezzling funds from Tyndall Federal Credit Union.

United State District Judge Richard A. Smoak also ordered McKay to serve a term of five years’ supervised release upon her release from custody and to pay $157,713.38 in restitution.
On March 17 2010, McKay pled guilty to a one count information charging her with bank embezzlement, in violation of Title 18, United States Code, Section 656. Facts presented during the plea hearing revealed that McKay was a lead financial representative at Tyndall Federal Credit Union and that from on or about July 1, 2008 to July 13, 2009, she used her position to embezzle at least $157,713.38 from the bank.
Ms. Marsh praised the work of the Federal Bureau of Investigation and the Bay County Sheriff’s Office, whose joint investigation led to McKay’s plea and sentencing.
The case was prosecuted by Assistant United State Attorney J. Ryan Love.

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