FROM MANSFIELD NEWS JOURNAL -
Two Mansfield men pleaded guilty Monday in U.S. District Court in Cleveland to charges involving embezzlement and fraud totaling $2.1 million.
Kevin J. Moore, 35, former manager of the Huntington National Bank branch in Ontario and a KeyBank branch in Mansfield, pleaded guilty to one count of bank embezzlement, two counts of wire fraud and three counts of tax evasion.
He was represented at a hearing scheduled for 1:45 p.m. by attorney Roger M. Synenberg of Cleveland.
As part of the plea agreement, Moore agreed to pay an undetermined amount of restitution to victims. Those could include the banks, the Federal Deposit Insurance Corp. (which insures banks) and a man who was defrauded of $360,000 in a phony investment scheme, according to Robert J. Patton and Christian H. Stickan, of the Office of the U.S. Attorney.
While Moore’s assets have not yet been gauged, the probation department will look into that issue.
“He’ll be under an obligation to make that repayment,” Stickan said. “They are going to try to explore what assets are available. I don’t want to give anybody any false hopes that there’s a gold mine.”
During Monday’s 45-minute hearing, Randy L. Meister, 60, a friend of Moore’s, pleaded guilty to one charge, misprision of a felony (becoming aware of a crime and helping to conceal it), with bond set at $10,000. He was represented by a public defender.
The men, both Mansfield residents, were arraigned before Magistrate Nancy A. Vecchiarelli. Sentencing will be March 13, before Judge Christopher Boyko.
Bond was set at $20,000 for Moore and $10,000 for Meister, with both men on supervision until sentencing.
A bill of information filed by the U.S. Attorney’s office charged that Moore, while working as manager of Huntington National Bank on Village Park Court South in Ontario between August 2008 to November 2010, embezzled about $1.7 million from Huntington and its CD and annuity customers.
Moore met with Huntington customers who wanted to open or renew accounts, then pocketed the money — targeting certificates of deposit (CDs) and investments in annuities because the bank did not then send customers monthly statements for those types of accounts. The plea agreement says he offered customer phony inflated interest rates the bank would not actually provide, to entice them to keep their money in those accounts — and “flipped” money from other accounts when customers decided to cash out.
“He was telling (bank tellers) that customers were coming in and taking out the money,” Stickan said. “It’s a pretty sophisticated process. He certainly knew what he was doing when he did it.”
The information also charged Moore with three counts of tax violations for evading taxes for calendar years 2008, 2009, and 2010 in connection with that scheme. The IRS believes Moore owed more $514,720 in taxes on unreported income of $1.72 million from those three years.
Moore also was charged with wire fraud for defrauding a member of a church where he was assistant pastor of $360,000, by persuading him to put money into a phony “day-trading” scheme, then diverting the money for his own use. Moore told the man he could get returns amounting to $5,000 per month. The victim cashed out a 401K and sold stock to “invest” in the scheme.
“He (the victim) was getting small payments back, but that was done in the guise of keeping him quiet,” Stickan said.
Moore, who was manager for the Ontario branch of KeyBank from fall 2007 to spring 2008, also was charged with bank fraud for opening lines of credit in the name of Randy L. Meister, initially without his friend’s knowledge. Prosecutors say he then fraudulently drew on those lines.
The U.S. Attorney’s Office alleged one of the lines of credit was opened against a home at 234 Poplar St. that Meister owned, and that was purchased with cash Moore provided. The loss involved in that incident was $45,400, according to court records.
Meister was charged for allowing his name and real property to be used to establish the lines of credit at KeyBank, allowing Moore to proceed with fraudulent withdrawals from the lines of credit, and concealing Moore’s bank fraud from authorities. The statutory penalty for misprision of a felony is three years and a $250,000 fine.
Under federal law, the bank embezzlement and bank fraud charges against Moore must involve prison time.
“The seriousness of the bank fraud statute is reflected by the fact that those charges are non-probationable,” Patton said. “Those found guilty of those charges will go to prison, even if you have no record.
“The public has to have confidence in the banking system, and the only way to do that is to prosecute people who abuse it.”
Bank embezzlement has a maximum statutory penalty of up to 30 years and a $1 million fine. Maximum penalties for the other charges are 20 years and a $250,000 fine for wire fraud; five years and a $250,000 fine for tax evasion; and 30 years and a $1 million fine for bank fraud.
“Criminal acts are typically not foreseeable,” Patton said. “I don’t think there’s a particular defect in the processes at Huntington. He (Moore) was doing things at KeyBank (also).”
While FDIC insurance prevented bank customers from individually losing money, the U.S. Probation Office will determine what amounts of restitution the FDIC, the banks, or the church member may be owed.
Federal agencies initially began investigating the two men after Meister “came under the radar screen of the FBI” in connection with his home loan, Patton said.
“It’s not unusual for a bank, when they see unusual activity, to make a referral,” Stickan said.
Federal prosecutors said that investigation, which linked the two men, eventually converged with the others. The church member Moore persuaded to put money into the phony investment scheme independently lodged a separate complaint with the FBI in connection with his losses, the U.S. Attorney’s office said.
Wednesday, November 28, 2012
Former bank executive sentenced for embezzlement in Montana
From the Billings Gazette-
A former vice president at a Montana bank was sentenced to more than nine years in prison after authorities said she embezzled nearly $3.7 million to cover personal debts.
Rhonda Lee Devries, 51, was sentenced Monday by U.S. District Judge Sam Haddon in Great Falls.
Devries pleaded guilty in August to bank fraud, embezzlement by a bank officer, credit card fraud and money laundering involving the assets taken from First Security Bank in Malta over nearly a dozen years.
"She tearfully accepted the sentence and expressed profound regret and sorrow for everything she did and took full responsibility for her actions," defense attorney Mark Parker of Billings told The Billings Gazette (http://bit.ly/UZr4t6)
The judge also ordered Devries to pay $3.8 million in restitution and to spend three years on probation.
Assistant U.S. Attorney Carl Rostad had sought a 10-year sentence, calling the scheme methodical, devious and sophisticated, and saying it "involved countless acts of theft and deception."
The crime "has seriously jeopardized the continued existence of a community financial institution, thereby putting at risk the futures of the bank's employees, the financial security of its shareholders and the availability of credit for a small agricultural community," Rostad wrote in his sentencing recommendation.
Prosecutors alleged that Devries had managed about $40,000 in debt by transferring it to new credit cards until January 2001, when her application for another account was declined.
During the next several years, she used her position as vice president of operations to open three high-limit credit cards and had accumulated balances totaling nearly $3.4 million when the fraud was discovered last spring, prosecutors said.
Another account opened in June 2011 had a balance of $304,493. Court records indicated that Devries manipulated bank records to cover the crimes, which were discovered in late April by the bank's credit card servicing company.
The bank's directors and owners asked the judge to consider that Devries was a long-term officer, "giving her abundant knowledge to recognize that a theft of this magnitude would jeopardize the bank's existence."
The Federal Deposit Insurance Corp. insures most accounts for up to $250,000, so customers' deposits should not be affected by the fraud, court records said.
"There is every indication that First Security of Malta will survive as a bank," state banking commissioner Melanie Hall said. "The bank and its board of directors have taken significant steps to improve the financial condition, including the injection of more than $1 million in capital."
A former vice president at a Montana bank was sentenced to more than nine years in prison after authorities said she embezzled nearly $3.7 million to cover personal debts.
Rhonda Lee Devries, 51, was sentenced Monday by U.S. District Judge Sam Haddon in Great Falls.
Devries pleaded guilty in August to bank fraud, embezzlement by a bank officer, credit card fraud and money laundering involving the assets taken from First Security Bank in Malta over nearly a dozen years.
"She tearfully accepted the sentence and expressed profound regret and sorrow for everything she did and took full responsibility for her actions," defense attorney Mark Parker of Billings told The Billings Gazette (http://bit.ly/UZr4t6)
The judge also ordered Devries to pay $3.8 million in restitution and to spend three years on probation.
Assistant U.S. Attorney Carl Rostad had sought a 10-year sentence, calling the scheme methodical, devious and sophisticated, and saying it "involved countless acts of theft and deception."
The crime "has seriously jeopardized the continued existence of a community financial institution, thereby putting at risk the futures of the bank's employees, the financial security of its shareholders and the availability of credit for a small agricultural community," Rostad wrote in his sentencing recommendation.
Prosecutors alleged that Devries had managed about $40,000 in debt by transferring it to new credit cards until January 2001, when her application for another account was declined.
During the next several years, she used her position as vice president of operations to open three high-limit credit cards and had accumulated balances totaling nearly $3.4 million when the fraud was discovered last spring, prosecutors said.
Another account opened in June 2011 had a balance of $304,493. Court records indicated that Devries manipulated bank records to cover the crimes, which were discovered in late April by the bank's credit card servicing company.
The bank's directors and owners asked the judge to consider that Devries was a long-term officer, "giving her abundant knowledge to recognize that a theft of this magnitude would jeopardize the bank's existence."
The Federal Deposit Insurance Corp. insures most accounts for up to $250,000, so customers' deposits should not be affected by the fraud, court records said.
"There is every indication that First Security of Malta will survive as a bank," state banking commissioner Melanie Hall said. "The bank and its board of directors have taken significant steps to improve the financial condition, including the injection of more than $1 million in capital."
Former Kansas bank teller sentenced for embezzlement
From SFGate.com
A former teller at a northeast Kansas bank will spend 10 months in home confinement for embezzling more than $27,000 from the bank.
The U.S. Attorney's office says 23-year-old Brittney L. Crane will also serve two years of supervised release under the sentence she received Monday.
Crane worked at a branch of US Bank in Kansas City, Kan. In a guilty plea she entered in August, she admitted processing forged counter withdrawal slips totaling $27,700 in late 2011.
A video recording of one transaction showed her processing a forged withdrawal slip for 20-year-old Cierra Clayborn at a drive-thru window. Investigators said the two women met later in the day to split up the money.
Clayborn, also of Kansas City, Kan., has pleaded guilty to bank embezzlement and faces sentencing Dec. 3.
Wednesday, November 21, 2012
Two ex-tellers get probation in separate bank theft cases in Illinois
Two former tellers involved in separate thefts while working for a Holiday
Shores bank have been given probation and orders of restitution to pay back
thousands of dollars.
The second of the tellers, Jamie L. Gajewski, was accused of stealing nearly $90,000. She pleaded guilty Tuesday to felony theft in exchange for a sentence of three years of probation.
Authorities said the deal was made possible, in part, by the willingness of Robert Behme, owner of Behme's Market in Holiday Shores, to go along with it.
Behme told authorities he felt sorry for the defendant and just wanted his money back.
Gajewski, 29, of the 1200 block of Nassau Drive, Holiday Shores, pleaded guilty in Madison County Circuit Court to one felony count of theft over $10,000, a Class 2 felony punishable by up to seven years in prison.
She had no previous criminal record.
Gajewski was a teller at First National Bank of Staunton, Assistant Madison County State's Attorney Rachelle Crowe said.
In a statement read in court, Crowe said that, had there been a trial, store employees, police and bank officials would have testified and proved that the store employees were taking the bank deposits to the bank each evening, but Gajewski was pocketing some of the money.
Gajewski would make up a deposit slip to cover the difference between the amount put in the account and the amount the employees took to the bank.
The thefts occurred between January 2011 and Jan. 23 of this year. Behme started noticing shortages in the store's account and asked police to investigate. Crowe said the investigation revealed all the short transactions were traced to Gajewski as teller.
The Madison County Sheriff's Department handled the investigation.
Gajewski was charged in March. The original charge alleged she took $37,000, but a further investigation set the amount at nearly $90,000.
Circuit Judge Richard Tognarelli accepted the agreement for the three years of probation and set the restitution at exactly $89,923. Gajewski also will have to pay court costs and the cost of probation.
The defendant posted $6,000 cash bond shortly after she was charged and has remained free on bond since.
Gajewski was represented by defense attorney John Stobbs of Alton.
"She is very sorry for what she did, and she is thankful that the victim was willing to go along with the agreement," Stobbs said. "For the rest of her life, she will have a felony on her record, and that will make it very difficult to get another job."
Gajewski was the second teller this year to be charged in a major theft case involving the Holiday Shores branch of the bank.
Lori A. Surgant, 51, also of Holiday Shores, was charged Feb. 7 and pleaded guilty in July.
Surgant was accused of stealing more than $7,000 from the bank, which reported suspicions to the Sheriff's Department after an internal audit.
She was ordered to pay $7,246 in restitution as part of her plea agreement.
In Surgant's case, the Sheriff's Department initially was contacted Jan. 26. Sheriff's Department officials said their investigation showed Surgant was suspected of stealing the money from Nov. 1, 2011, through Jan. 20 of this year.
The thefts reportedly occurred during Surgant's normal shifts as a teller and initially were discovered because of a shortage in her drawer.
Surgant worked at the bank for eight years.
The second of the tellers, Jamie L. Gajewski, was accused of stealing nearly $90,000. She pleaded guilty Tuesday to felony theft in exchange for a sentence of three years of probation.
Authorities said the deal was made possible, in part, by the willingness of Robert Behme, owner of Behme's Market in Holiday Shores, to go along with it.
Behme told authorities he felt sorry for the defendant and just wanted his money back.
Gajewski, 29, of the 1200 block of Nassau Drive, Holiday Shores, pleaded guilty in Madison County Circuit Court to one felony count of theft over $10,000, a Class 2 felony punishable by up to seven years in prison.
She had no previous criminal record.
Gajewski was a teller at First National Bank of Staunton, Assistant Madison County State's Attorney Rachelle Crowe said.
In a statement read in court, Crowe said that, had there been a trial, store employees, police and bank officials would have testified and proved that the store employees were taking the bank deposits to the bank each evening, but Gajewski was pocketing some of the money.
Gajewski would make up a deposit slip to cover the difference between the amount put in the account and the amount the employees took to the bank.
The thefts occurred between January 2011 and Jan. 23 of this year. Behme started noticing shortages in the store's account and asked police to investigate. Crowe said the investigation revealed all the short transactions were traced to Gajewski as teller.
The Madison County Sheriff's Department handled the investigation.
Gajewski was charged in March. The original charge alleged she took $37,000, but a further investigation set the amount at nearly $90,000.
Circuit Judge Richard Tognarelli accepted the agreement for the three years of probation and set the restitution at exactly $89,923. Gajewski also will have to pay court costs and the cost of probation.
The defendant posted $6,000 cash bond shortly after she was charged and has remained free on bond since.
Gajewski was represented by defense attorney John Stobbs of Alton.
"She is very sorry for what she did, and she is thankful that the victim was willing to go along with the agreement," Stobbs said. "For the rest of her life, she will have a felony on her record, and that will make it very difficult to get another job."
Gajewski was the second teller this year to be charged in a major theft case involving the Holiday Shores branch of the bank.
Lori A. Surgant, 51, also of Holiday Shores, was charged Feb. 7 and pleaded guilty in July.
Surgant was accused of stealing more than $7,000 from the bank, which reported suspicions to the Sheriff's Department after an internal audit.
She was ordered to pay $7,246 in restitution as part of her plea agreement.
In Surgant's case, the Sheriff's Department initially was contacted Jan. 26. Sheriff's Department officials said their investigation showed Surgant was suspected of stealing the money from Nov. 1, 2011, through Jan. 20 of this year.
The thefts reportedly occurred during Surgant's normal shifts as a teller and initially were discovered because of a shortage in her drawer.
Surgant worked at the bank for eight years.
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