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Thursday, August 30, 2012

Ex-bank employee who took $84,000 to get year in jail In Connecticutt


Former Webster Bank Supervisor Kimberly MacDonald will be sentenced in January to a year in prison for stealing $84,000 by removing bills from the center of strapped cash bundles, and replacing them with $1 bills.

MacDonald, 40, of 237 Moore Drive, in Torrington, turned over $20,000 to the bank Tuesday when the terms of a plea agreement were outlined in Superior Court before Judge James P. Ginocchio. She will be sentenced to five years of probation following her release to repay the remainder of what she stole.

MacDonald admitted taking the cash over five years from Webster Bank branch at 155 Main St. in Thomaston where she was a teller supervisor. She was arrested last December, telling police she starting replacing $100 and other large bills in stacks of $2,000 in cash.

Wednesday, August 8, 2012

Bank chief stole $2.3M, brought down Philly credit union


A former bank manager from Philadelphia was charged today in embezzling more than $2.3 million from a credit union that he used to try to buy 15 kilograms of cocaine and real estate, federal authorities said.

Ignacio "Nacho" Morales, 40, was manager of the Borinquen Federal Credit Union, which served low-income Hispanics in North Philadelphia. In June 2011, the National Credit Union Association took over BFCU, but within two weeks, closed the credit union and liquidated its assets.

The sudden shuttering of the financial institution puzzled and upset community leaders who, at the time, were not told what had happened.

The court documents explained why.

According to U.S. Attorney Zane David Memeger, Morales looted $600,000 in 2008 to buy real estate and allegedly stole $560,000 in 2009 in an attempt to purchase 33 pounds of cocaine.

Part of Morales' alleged scheme involved cashing fake IRS tax return checks. Morales kept 20 percent of the value of each phony check, according to an court records. In addition, he allowed one credit union member to withdrawal $500,000 from an account even though there was nothing in it; took $700,000 that another member attempted to deposit for his personal use, and altered bank records and delivered fake statements to cover up his actions.

Morales is charged with conspiracy to defraud the government with respect to claims, misapplication and embezzlement, making false reports on federal credit institution entries, engaging in monetary transaction in property derived from specified unlawful activity, filing false federal income tax returns, and attempted possession with intent to distribute more than five kilograms of cocaine.

Monday, August 6, 2012

Prosecutors seek 10-year sentences for principals in Pinehurst Bank scheme in Minnesota


Federal prosecutors are seeking 10-year prison terms for John Markert and George Wintz, who were convicted in April on charges related to a $1.8 million check-kiting scheme at the former Pinehurst Bank in St. Paul.

But attorneys for Markert, the former president of Pinehurst, and Wintz -- a trucking company owner who was a major customer at the bank -- want sentences that involve probation or home confinement.

The two were convicted following a 12-day trial that found Markert, 58, of Mendota Heights, guilty on five counts of misapplication of bank funds, along with an acquittal on bank fraud charges.

Wintz, 72, of Minneapolis, was found guilty of bank fraud and embezzlement, while being acquitted on the misapplication-of-funds charges.

Prosecutors filed papers Monday, Aug. 6, arguing for the 10-year sentences. The dueling position papers about what punishment the two should receive revisit disagreements at trial about whether the bank actually lost any money. Both sides also disagree with portions of a pre-sentence investigation by probation officers, which assigns "offense levels" to the crime and can push a recommended prison sentence up or down.

While the probation office found that Markert, for instance, should see his offense level rise because he abused a position of trust at the bank and jeopardized the bank's soundness, his attorneys disagree.

They argue that Markert was trying to save the bank from insolvency after Wintz's overdraft, and that a sentence of probation is appropriate.

Meanwhile, Wintz's attorney, Andy Luger, is asking for a "creative and unique" sentence for his client. He argues that Triangle Warehouse -- Wintz's trucking and warehouse company in Northeast Minneapolis, which employs more than 130 people full-time -- shouldn't have to go out of business.

Luger requests a prison sentence for Wintz that runs on weekends, confines him to his home when he's not working, and suggests a court-appointed financial monitor to watch his business dealings.

"In his few remaining productive years in business, Wintz requests that he be allowed to serve a sentence that allows him to save the jobs and careers of his employees," Luger argued in his position paper.

Evidence at trial showed that Wintz had a history of kiting checks -- which involves flowing funds between two checking accounts at different banks to cover overdrafts -- and that bank employees had made Markert aware of it. When Wintz's kiting produced the $1.8 million overdraft in 2009, Markert helped put together a scheme to originate loans in the names of five people -- including Wintz's daughter and a long-time employee -- to cover the overdraft.

Prosecutors say those five "nominee loans" were fraudulent, and that the actual loss in the case is $1.8 million. Attorneys for Markert and Wintz argue that the bank didn't lose any actual cash, and that Wintz continues to make payments on the five loans, which are now held by Coulee Bank, based in Wisconsin.

The jury cleared a third defendant at trial, Greg Pederson, a former senior loan officer at Pinehurst, on all counts.

Sentencing dates have not been set for Markert and Wintz.

The final decision on sentencing will be up to U.S. District Court Judge Ann Montgomery, who is handling the case.

Saturday, August 4, 2012

Former Bank Officer Faces Prison, Millions in Restitution for Embezzlement in Oklahoma


A former bank officer has been sentenced to four years and nine months in prison and ordered to pay millions of dollars in restitution after pleading guilty in what a federal prosecutor called “the largest internal bank theft” in the history of the Tulsa-based Northern District of Oklahoma.

Janice Mora Adams, a former senior vice president for private banking and internal control officer of Peoples Bank, stated in court documents that she initiated fraudulent loans and accounts as part of a scheme in which she embezzled funds from May 2004 until February 2010.

Adams, 55, pleaded guilty Feb. 28 to a charge that alleged she misapplied money over the nearly six-year period. The Broken Arrow resident stipulated in her plea agreement that her conduct caused a loss to the bank of $3.05 million. However, Assistant U.S. Attorney Charles McLoughlin said Tuesday that, due to its insurance coverage, the bank itself only sustained a loss of about $4,000.

Adams also pleaded guilty in February to five tax crimes connected to the money she embezzled but did not report on her federal income taxes.

McLoughlin said in a court document that what Adams did amounted to a “very complex and complicated looting of Peoples Bank.”

He said there were several different elements of the scheme, but that the primary method of embezzlement involved Adams creating fictitious loans based on information obtained from existing accounts of bank customers without those customers’ knowledge.

McLoughlin said, by the time it was over, Adams was responsible for “the largest internal bank theft” in the history of Tulsa’s Northern District. Adams’ purchases included nearly $250,000 on items such as cosmetics, perfume and clothes from Dillard’s; more than $450,000 on jewelry from Moody’s; more than $66,000 on merchandise from White House Black Market and nearly $70,000 on goods from the Pottery Barn.

The bank’s news release stated it “remains financially strong and has strengthened its internal controls to (ensure) that improper activity is uncovered and stopped at the earliest possible date.”

U.S. District Judge Claire Eagan ordered Monday that Adams pay more than $3 million in restitution to the bank’s insurer as well as $859,474 to the Internal Revenue Service for tax years 2005 through 2009. Adams was also ordered by Eagan to be under court supervision for five years after being released from prison.

Eagan ordered Adams, who is on bond, to report to prison by Sept. 12.

Adams pleaded guilty in February to an amended charge filed Jan. 19 by the U.S. Attorney’s Office in Tulsa.

She also agreed to pay a criminal money judgment of more than $2.6 million.

The amount is meant to represent the money she misapplied, reduced by $317,289 in jewelry that she already has forfeited.

Adams also agreed to forfeit more than $24,000 in lieu of two vehicles obtained with proceeds of her crime.

Oklahoma Bank Teller Charged With Pocketing Cash From Customers


An Oklahoma City bank teller is charged with embezzlement after police say she pocketed customers' cash deposit by filling out fraudulent deposit slips.

According to police, 23-year-old Nicole Kemp, a bank teller at the Oklahoma Fidelity Bank, had conducted 14 fraudulent cash deposit transactions.

Investigators say Kemp would alter the amount of cash deposit after the customers had left by filling out a new deposit slip with lower amount of cash, and alter the deposit total in the bank's computer to show the lower deposit amount, in order to cover up the theft.

Police say Kemp would then pocket the customer's cash.

On May 7, a customer with the Victory Bible Baptist Church went to Kemp to deposit $1,305, including $229 in cash, and $1,076 in checks. However, he later noticed on his bank statement that the amount of cash deposited into his account only showed $69.

The customer then contacted the bank and authorities conducted investigations into the incident. It turns out the bank teller, Kemp, had filled out a new deposit slip for only $69 after the customer had left, and changed the amount in the bank's computer to show only $69.

The bank provided police with security video and copies of checks and deposit slips.

Kemp is now charged with unauthorized use of a computer network for the purpose of obtaining money and other things of value, by use of a false or fraudulent presentation.

The total loss to the Oklahoma Fidelity Bank was $1,084, according to police.

Former Tennessee Commerce official charged with embezzlement


A former official from the now-defunct Tennessee Commerce Bank was indicted Thursday on a single charge of embezzlement, according to federal court documents.

Lisa Crawford Justice is accused of stealing more than $100,000 from the Franklin-based bank, which earlier this year became Tennessee's first bank failure in the wake of the Great Recession.

In 2008, Crawford was named operations officer and deposit operations supervisor with the bank.

The U.S. Attorney's Office for the Middle District of Tennessee accuses Crawford of taking the funds between 2009 and 2011. The government is seeking forfeiture of the money; the offense carries a maximum fine of $1 million and 30 years in prison.