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Friday, December 31, 2010

Former Birmingham, Alabama bank employee indicted

 A federal grand jury today indicted a Hoover woman for embezzling money from the bank where she worked, announced U.S. Attorney Joyce White Vance and U.S. Secret Service Special Agent in Charge Roy Sexton.

The indictment filed in U.S. District Court charges Regina Stewart, 48, with two counts of embezzling money from Nexity Bank in Jefferson County while she was employed there. The indictment also seeks forfeiture of $45,745 from Stewart as proceeds of illegal activity.

According to the indictment, Stewart embezzled the money by fraudulently redeeming certificates of deposit held by two clients of the bank.

“Embezzlement by bank employees is a serious crime that undermines the public’s trust in the financial system,” Vance said. “That trust, and the stability of our financial institutions, must be protected,” Vance said.

The maximum sentence for embezzlement by a bank employee is 30 years in prison and a $1 million fine.

The Secret Service investigated this matter. Assistant U.S. Attorney Davis A. Barlow is prosecuting the case.

This prosecution is part of President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency task force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.

Members of the public are reminded that the indictment contains only charges. A defendant is presumed innocent of the charges and it will be the government’s burden to prove a defendant’s guilt beyond a reasonable doubt at trial.

Friday, December 24, 2010

Billings woman accused of bank embezzlement

An ex- employee of Montana Health Federal Credit Union denied

federal embezzlement charges Tuesday.

Sarah Anne Housley, 33, of Billings, pleaded not guilty to an

indictment charging her with bank embezzlement. The indictment

alleges that Housley, who was employed by the credit

union, embezzled at least $1,000 over in this area 2-1/2 years, until


If convicted, Housley faces a maximum 30 years in prison and a

$1 million fine. U.S. Magistrate Judge Carolyn Ostby continued

Housley’s relief pending trial. The case will be heard by Senior

U.S. District Judge Jack Shanstrom.

Amarillo Woman Sentenced for Embezzling Approximately $93,000 from Firstbank Southwest in Texas

Megan Elaine Hahn, 23, of Amarillo, Texas, was sentenced today by U.S. District Judge Mary Lou Robinson to 12 months and one day in federal prison, announced U.S. Attorney James T. Jacks of the Northern District of Texas. In addition, Judge Robinson ordered that Hahn pay $93,255 in restitution. Hahn pleaded guilty in October to one count of theft by a bank employee. Judge Robinson ordered that Hahn surrender to the Bureau of Prisons on January 11, 2011, to begin serving her sentence.

Hahn is a former teller at FirstBank Southwest. She admitted that beginning in 2008 until mid-May 2010, she stole money from her cash drawer. She concealed her thefts by manipulating the balance of her teller drawer on her computer and by falsifying cash in and cash out tickets. On May 18, 2010, after she saw auditors arrive at the bank, Hahn went to the bank managers and admitted her theft. She obtained approximately $93,000 from the bank over a two-year period.

The case was investigated by the FBI and prosecuted by Assistant U.S. Attorney Christy Drake of the U.S. Attorney's Office in Amarillo.

Tuesday, December 21, 2010

Former Loan Officer Admits Fraud in California

Melvin Rohs, 64, Nevada City, California, pleaded guilty to three counts of embezzlement by a bank employee and two counts of making a false statement in connection with a loan application.

According to court documents, Rohs was a senior loan officer at a regional bank headquartered in Nevada City, California, until he was terminated in May 2009. In December 2008, February 2009, and March 2009, Rohs initiated three unauthorized fund transfers from the account of Customer A to the account of Customer B totaling $ 472,109.80. Also according to court documents, in September 2008 and April 2009, Rohs falsified Customer B’s loan documents by making materially false statements concerning the credit worthiness of Customer B and by making an unauthorized increase to the loan approved by the bank. The loss associated with Rohs’s criminal conduct totals $ 2,172,109.80.

Rohs is scheduled to be sentenced by Judge Karlton on March 1, 2011 at 9:15 A.M. The maximum statutory penalty Rohs faces is 30 years in prison on each count and a fine of $ 5 million. Rohs also will be ordered to make restitution to the victim of his offenses. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

United States Attorney Benjamin B. Wagner made the announcement. This case is the product of an investigation by the Internal Revenue Service, Criminal Investigation. Assistant United States Attorney Camil A. Skipper is prosecuting the case.

Gang embezzles €5.6m from unnamed Dutch bank

Police have arrested 13 people in connection with the embezzlement of €5.6m from a Dutch bank by manipulating the computer system.

Police refused to say which bank was involved but said the money was taken directly from the bank rather than private accounts.
The cash ended up on the bank account of a 26-year-old man from Wageningen and was then moved to a number of different accounts abroad. So far €2m has been recovered.
The 26-year-old is among the 13 people who have been arrested. The oldest was 52. Not all the men knew each other, police said, and it is not clear if more arrests will follow.

Sunday, December 19, 2010

Former credit union official charged with embezzling in Michigan

A retired Muskegon High School assistant principal has been charged with embezzling thousands of dollars from a teachers’ credit union where he was office manager.

Kenneth Richard Doctor, 62, of 5451 Davis is scheduled for a preliminary examination Jan. 5 on a charge of embezzlement from a financial institution. That’s a felony punishable by up to 20 years in prison.

Doctor was arraigned Nov. 29 and is free on a $10,000 signature bond, according to court records.

Brett Gardner, chief assistant Muskegon County prosecutor, said Muskegon police reports indicate Doctor allegedly used money from the Muskegon Teachers Credit Union “for his own personal use and gain” over a period of time through August 2008. The money — totaling more than $6,000 — allegedly was spent on “personal items” in several transactions, Gardner said.

Police reports indicate Doctor was office manager and treasurer of the board of directors of the credit union, located at 1150 Amity. The alleged missing money was uncovered as the result of an audit in the summer of 2008 that resulted in Doctor’s suspension, Gardner said.

Fredric Balgooyen, the Muskegon attorney listed in court files as representing Doctor, could not be reached for comment.

Doctor earlier worked as assistant principal and dean of administrative services for Muskegon High School.

Saturday, December 18, 2010

Former Sitka Credit Union CFO Sentenced in Alaska

A former credit union CFO in Sitka will serve two years in prison for embezzlement. Vicki Weidenhof was convicted earlier this year for skimming over $187,000 in operational money from the ALPS Federal Credit Union in Sitka. US District Court Judge John Sedwick handed down the sentence Friday morning.

Friday, December 17, 2010

Ex-banker sentenced for embezzlement in Iowa

A former branch manager of a bank in Ankeny has been sentenced to more than a year in prison for embezzlement.

Dana Schmieding of Cambridge was accused of embezzling money between 2001 and 2008 from U.S. Bank.

Federal prosecutors said she took unauthorized advances from existing consumer loans, originated loans in the names of the bank and bank customers without their knowledge or consent, and accessed established credit lines of various bank customers.

Schmieding pleaded guilty to a charge of embezzlement by a bank employee.

The U.S. attorney’s office said she was sentenced last week to 17 months in prison. Schmieding also was ordered to serve five years of supervised release and to pay restitution of $250,000.

Menomonie, Wisconsin woman pleads guilty to bank embezzlement

John W. Vaudreuil, United States Attorney for the Western District of Wisconsin, announced that Becky L. Jensen, 51, of Menomonie, Wis., pleaded guilty Thursday in U.S. District Court in Madison to bank embezzlement.

At the plea hearing, Jensen admitted embezzling approximately $28,000 from her former employer, Bremer Bank in Eau Galle, Wis. The charge against Jensen was the result of an investigation conducted by the Eau Claire office of the Federal Bureau of Investigation. The prosecution of the case has been handled by Assistant U.S. Attorney Grant C. Johnson.

U.S. District Judge Barbara B. Crabb scheduled sentencing for March 1, 2011. Jensen faces a maximum penalty of 30 years in prison.

Former Citizens Bank loan officer pleads guilty to embezzlement in Nevada

Melvin Rohs, 64, of Nevada City, pleaded guilty today in federal court to three counts of embezzlement by a bank employee and two counts of making a false statement in connection with a loan application.

This case is the product of an investigation by the Internal Revenue Service, Criminal Investigation. Assistant United States Attorney Camil A. Skipper is prosecuting the case.

According to court documents, Rohs was a senior loan officer at a regional bank headquartered in Nevada City until he was terminated in May 2009. While Skipper declined to name the bank, Rohs was listed online as having been an assistant vice president and a senior commercial loan underwriter at Citizens Bank.

In December 2008, February 2009, and March 2009, Rohs initiated three unauthorized fund transfers from the account of one customer to the account of a second customer, totaling $472,109.80. Also according to court documents, in September 2008 and April 2009, Rohs falsified the loan documents of the second customer by making materially false statements concerning credit worthiness and by making an unauthorized increase to the loan approved by the bank. The loss associated with Rohs' criminal conduct totals $2,172,109.80.

Rohs is scheduled to be sentenced by Judge Karlton on March 1. The maximum statutory penalty Rohs faces is 30 years in prison on each count and a fine of $5 million. Rohs also will be ordered to make restitution to the victim of his offenses.

Tuesday, December 14, 2010

Bank manager sentenced in mortgage fraud in Pennsylvania

A former Citizens Bank branch manager who provided false documents underlying mortgages will get home confinement and probation, U.S. District Judge Nora Barry Fischer decided today.

Crystal Spreng, 40, of Cabot, ran the Bloomfield branch for Citizens Bank, and won a manager of the year award in 2006, according to court filings. But from 2005 through 2007, according to a June 2009 indictment, she was a bit player in a mortgage fraud ring run by broker Robert Arakelian, who has pleaded guilty but has not yet been sentenced.

Ms. Spreng's role was to confirm to other lenders borrower bank balances that were not actually in their accounts. Prosecutors accused her of involvement in nine mortgages totaling $608,501, but she pleaded guilty to just one count and argued in pleadings that Mr. Arakelian pasted her signature without her knowledge on some of the documents he used to justify loans.

Assistant U.S. Attorney Brendan Conway argued for, at the very least, confinement in a halfway house. "We cannot have bank managers filling out fraudulent verifications of deposits," he told Judge Fischer. "That has got to stop."

Defense attorney John A. Knorr, though, successfully argued that Mr. Arakelian was "a spider who ensnared" Ms. Spreng in a broader scheme.

Judge Fischer said she was swayed in part by Ms. Spreng's difficult upbringing, her charity work for homeless veterans and others, her close family including three children ages 16 to 21, and the humiliation and career loss she has already suffered.

Ms. Spreng will be allowed to continue working as a waitress during six months of home confinement as part of five years of probation. If prosecutors can identify victims and amounts lost, she will have to pay restitution

Tuesday, December 7, 2010

‘Robin Hood’ banker gets 63 months for fraud in Illinois

First Security Trust & Savings Bank loan officer Jeffrey Gonsiewski, pleaded guilty in August to one count of federal bank fraud, was sentenced to 63 months in prison by U.S. District Judge Elaine Bucklo on Tuesday.

The U.S. Government last summer had accused the 56-year-old high school graduate of changing loan terms or arranging loans to be made in a scheme that ultimately caused the Elmwood Park-based lender, part of the Wirtz family empire, to lose more than $5.5 million.

Some monies have since been recovered, so Gonsiewski now has been ordered to pay nearly $5.2 million in restitution. On Jan. 20 he’ll report to a still-unspecified prison.
Gonsiewski had admitted that he changed the terms of at least 100 loans for more than 50 struggling borrowers to make it appear that their payments were current when in fact they were overdue. He’d change due dates to a later time period, or monthly payments to quarterly ones, or principal-and-interest payments to interest-only payments.

At least once, he wrote off $100,000 in interest owed by one borrower. Or he’d loan more money even when the borrowers didn’t have sufficient collateral.

In documents filed Monday with the court, Gonsiewski’s lawyer, Terrence LeFevour, said the crime on his client’s part was “an idiotic attempt to assist his clients, hoping that with extensions of their loans by deceit, eventually these clients would” repay the bank when the economy would improve and the property would be sold.

“As stupid as his plan can be judged, he never sought to profit from it,” his lawyer wrote, adding that he “never took one cent from anybody.”

Gonsiewski, who after spending more than 30 years at the bank now works as a caterer’s helper and a stock boy and also recently as a delivery driver, told the judge before his sentencing that he was “truly sorry.”

“I really only had good intentions,” a bearded, balding and bespecled Gonsiewski said softly. “I spent 34 years doing a job I loved.” He said he has also apologized to family and friends, particularly his wife, Beth, who was one of only a handful of people to attend the sentencing.

If Gonsiewski was indeed helping troubled bank borrowers, few if any showed up to express their appreciation during his sentencing in a U.S. District Court in Chicago. Both Jeff and Beth declined to comment afterward. Beth, with short hair and wearing a black suit and white shirt, retained her composure throughout the proceedings, as did Jeff.

A spokesman for the Wirtz family bank, Guy Chipparoni, was also in attendance.

In the courtroom, the government’s lawyer said Gonsiewski carried out his scheme from September 2004 to February 2009.

In a sentencing hearing that lasted about 45 minutes, the topic of Gonsiewski’s motive came up frequently.

Jackie Stern, the government lawyer, told the judge that she still isn’t positive what Gonsiewski’s motive was, speculating that perhaps he wanted “more authority” or “revenge” or felt unappreciated. The government uncovered no evidence that Gonsiewski personally profited from the scheme, she acknowledged.

Judge Bucklo also seemed baffled by Gonsiewski’s behavior in light of the fact that he didn’t appear to profit personally from it. His salary at the bank was $69,000 a year; his wife has worked as a bartender and as an assitant manager at a restaurant.

It came to light during the sentencing hearing, in fact, that there were times when Gonsiewski didn’t cash his paychecks from the bank, which led the judge to one of two conclusions: that he had money elsewhere or that he was mentally unbalanced, she theorized.

“He’s very sharp,” Stern told the judge of Gonsiewski, adding that he eventually did cash the paychecks.

Besides “motive is not a factor to be considered” during sentencing, Stern said to the judge. “The fact he did this, whatever the motive, he had no respect for the law.”

Since he was fired by the bank, Gonsiewski hasn’t sent so much as $20 to the bank as restitution, Stern said.

Gonsiewski’s lawyer, LeFevour, reiterated that his client isn’t hiding any money in any offshore accounts.

Said the judge: “It doesn’t make any sense.”

LeFevour, the defense lawyer, said Gonsiewski rarely even socialized with the bank’s clients, perhaps just once going out to dinner or golfing with them. He noted that his client has problems with alcohol.

Preparing to issue a sentence, the judge noted that a small bank lost $5.5 million because of fraud perpetrated by an insider over a long time period.

“It’s just baffling,” Judge Bucklo said again. “How it would be worth it I just do not understand.” She noted that he has about $400,000 in a retirement account. “That’s not peanuts,” she said.

In a court filing on Monday, LeFevour said Gonsiewski had no juvenile or adult convictions. He also wrote that the bank did a poor job of overseeing its workers.

“His simple efforts to deceive would not have been successful at all if someone at a minimum had been watching, just a little bit,” LeFevour wrote. “This was clearly not the case at First Security Bank.”

The defense lawyer sought to minimize the sophistication of Gonsiewski’s crime in hopes that the judge would go easier on him. “Gonsiewski used the simple tools of basic fraud — a pen and whiteout, or a replacement form — to complete his misguided efforts to help his clients,” his lawyer wrote Monday in a court filing.

In an earlier court proceeding, a bank customer named Luigi Adamo was identified as being the customer who was helped most often by Gonsiewski.

Saturday, December 4, 2010

Orange, California woman could face 400 years in prison on embezzlement charges

The president of an Orange County credit union has been indicted on embezzlement and money laundering charges.

Sandra H. Cooper, 56, of Orange, was indicted Wednesday. She is accused of embezzling $1,164,360 in four and a half years. If convicted, she faces up to 30 years in prison for each of the 14 embezzlement charges and up to 10 years in federal prison for the money laundering charges.
According to the indictment passed down by U.S. Attorney John M. Bales, Cooper, the president and treasurer of the two-employee Orange County Employees Federal Credit Union, is charged with writing checks from the credit union's checking account to herself and signing them. The checks ranged from $5,000 to $9,500.
Cooper is also accused of writing checks from the credit union's account for more than $10,000 to herself and cashing them, the indictment reads.
In June 2010, the National Credit Union Administration Board found the credit union insolvent and transferred all customer accounts to the Sabine Federal Credit Union.
Cooper's trial is set for Jan. 24.

Bank Official Admits Embezzling $50,000 in Indiana

The vice president of a local bank embezzled more than $50,000 by taking out loans on customers’ accounts and increasing her own mortgage, according to court records.

Sherlynn Groat, 56, of Hammond, agreed to plead guilty the same day she was charged in the U.S. District Court in Hammond with one count each embezzling money from the bank and entering in false information.
According to her plea agreement, Groat has worked at Liberty Savings Bank, a local company that has branches in Whiting and Schererville, since 1981. She admits in the agreement that from March 2008 to April 2010, she used the loans to take in more than $50,000 from the bank.
At first she used her position to increase her own mortgage, the agreements says, essentially using it as a line of credit for $16,500, which the bank does not allow. She went further by increasing the loan of a bank customer, without that customer’s knowledge, and kept the money for herself. Groat ended up creating a new loan for a bank customer, again taking the money for herself.
Groat says in the agreement that she tried to make payments on that loan but fell behind. That led to her creating a second loan to pay the first one off, according to the agreement. Groat says in the agreement that she hid paperwork of the loan from the customer.
She also admits to stealing checks a customer had sent in to make payments on the customer’s loan and used the money for herself.
According to court records, Groat has paid back all the money she took.
Neither her attorney nor a representative with Liberty Savings Bank could be reached for comment.
According to the agreement, Groat could face up to 30 years on each count, although U.S. attorneys will recommend that she receive the minimum of her sentencing guideline. It isn’t known what that would be. Also part of the plea deal is an agreement that Groat will sign an Order of Prohibition with the Office of Thrift Supervision, which would essentially ban her from working in the banking and insurance fields. It isn’t clear how long that ban would last.
An initial appearance for Groat has not been set yet, according to court records.

Thursday, December 2, 2010

Bank embezzler gets prison in Montana

.A former bank employee in Forsyth who embezzled $84,000 and used some of the money for fertility treatments will spend a year in federal prison.

Chief U.S. District Judge Richard Cebull on Thursday sentenced Courtney Marie Batey, 31, of Hysham to a year and a day in prison and ordered her to pay $84,040 restitution.
"I am extremely remorseful," Batey said. "It will never happen again."
Assistant federal defender Steve Babcock asked for leniency, saying depression, anxiety and medical problems that made it difficult to become pregnant led Batey to make poor choices.
Some of the money Batey stole went to pay for fertility treatments, Babcock said. And while admitting that Batey lived beyond her means, Babcock said she had a modest lifestyle.
Batey had no criminal history and cooperated when confronted with the thefts, Babcock said.
A six-month sentence to a halfway house would allow Batey, who has a young daughter, to continue with mental health counseling, Babcock said. Batey is more concerned with others than herself and was extremely remorseful, he said.
The judge declined the defense's recommendation but gave Batey a break by sentencing her below the guideline range of 15 months to 21 months.
The sentence will allow Batey to earn good time, which would shorten her sentence by about 15 percent.
Prison time is necessary, Cebull said, to reflect the seriousness of the crime, provide punishment and serve as a deterrent to others.
Batey pleaded guilty in August to one count of bank embezzlement. Batey worked as a teller at the Wells Fargo Bank in Forsyth for six years until July 2009, when she was promoted to teller/service manager.
Assistant U.S. Attorney Ryan Archer said Batey took advantage of her supervisory position to steal money from her teller drawer for about 18 months. She replaced the stolen funds with money she took from customer accounts when the customers cashed in certificates of deposit.
The embezzlement was discovered when a customer complained about being shorted $5,000 when she redeemed two CDs, Archer said. The bank compensated the customers for their losses.
Archer said there was nothing unique about Batey's case and that a 15-month sentence was reasonable. Batey stole a significant amount not only from her employer but also from customers, he said.
Batey used the money for personal gain by buying a $46,000 pickup truck and a $6,300 four-wheeler for her family in addition spending about $21,000 on medical expenses, Archer said.
Cebull said he would recommend that Batey serve her time in a medical facility and allowed her to report to the prison.

Ex-banker sentenced for North Penn embezzlement

A former North Penn Bank executive will spend 14 months in federal prison for embezzling $30,000 from the Scranton bank.

Glenn J. Clark, 37, of Scranton, was sentenced Thursday by Senior U.S. District Judge Edwin M. Kosik after pleading guilty June 3 to embezzlement and making false entries in bank records. The prison sentence will be followed by three years of supervised release.
Mr. Clark, North Penn's former assistant vice president, controller and principal accounting officer, was fired in November 2008 after the bank discovered the embezzlement.
An investigation found he embezzled about $30,000 in bank funds, which he used to pay personal expenses.
He was also accused of manipulating the bank's internal accounts and making numerous fraudulent journal entries in an attempt to conceal substantial shortages instead of reporting them to North Penn's management.