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Monday, April 29, 2013

Embezzlement Can Get You In Criminal Trouble With The State Or The Feds

 An employee at a Charlotte-area Macy's was recently arrested and charged with embezzling money from her employer. A series of questionable transactions by a department store cashier triggered an investigation by her employer and eventually the Charlotte-Mecklenburg police. According to police, the employee embezzled more than $2,000 from the SouthPark Macy's store.

The cashier had processed refunds for merchandise that had never actually been purchased. According to reports, the employee theft was then completed by putting the refunds onto store gift cards.

According to the Association of Certified Fraud Examiners, businesses average a loss of about seven percent of annual revenue to employee theft. It is no small loss, especially to small businesses. But employees who are wrongly accused of theft or who made an innocent mistake that is interpreted as fraud have even more on the line than the businesses themselves.

Employee theft is a common form of embezzlement and is considered a white collar crime. This type of financial fraud can lead to serious prison sentences, fines and restitution requirements, whether charged as a North Carolina state crime or a federal white collar crime.

Embezzlement Charges In North Carolina

Embezzlement is a crime of misappropriation. It is taking money or property that belongs to someone else with the intention of depriving that person or business of the use of those funds or property. It is different from larceny because it does not require that money or property be obtained illegally to be a criminal act.

For instance, a bank teller is entrusted with the funds at his or her window; the teller is legally entrusted with the cash he or she receives from customers or that is stocked from the bank's vault on a daily basis. However, if the bank teller takes money from the till for personal use, depriving the bank or its members of the use of that money, he or she has committed the crime of embezzlement.

A North Carolina embezzlement charge depends on the value of the funds or property that was embezzled and the relationship of the person who took property or funds for his own use to the true owner.

- Employees, officers or agents of a corporation, clerks, etc. If the value of what was embezzled is $100,000 or more, it is a Class C felony. If under $100,000, it is a Class H felony.

- Treasurers of charitable organizations. If the value of what was embezzled is $100,000 or more, it is a Class C felony. If under $100,000, it is a Class H felony.

- Railroad officers. If the value of what was embezzled is $100,000 or more, it is a Class C felony. If under $100, 000, it is a Class F felony.

- Public employees, including city and state government workers, and public officials. If the value of what was embezzled is $100,000 or more, it is a Class C felony. If under $100, 000, it is a Class F felony.

The felony sentencing structure in North Carolina provides the following punishment ranges for embezzlement for those who have no prior criminal history:

Felony Class Presumptive Sentencing Range

C 58-73 months in prison

F 13-16 months in prison

H 5-6 months in prison or community punishment

In addition, a person convicted of embezzlement will typically be required to pay back the value of the funds or property embezzled. This is referred to as restitution.

Federal Embezzlement Charges

In North Carolina, embezzlement may be charged as either a state white collar crime or a federal white collar crime, depending on the circumstances involved. It can be a simple, low-dollar crime or it can involve a multimillion-dollar scheme.

Federal embezzlement charges may involve direct embezzlement of government funds or property by a government employee or indirect embezzlement of government funds.

As with North Carolina state charges, federal embezzlement charges are dependent upon the person involved in the scheme and the value of the funds or property embezzled. If more than $1,000 is embezzled, the crime is a federal felony punishable by a $250,000 fine and up to 10 years in prison. If $1,000 or less is embezzled, the crime is a federal misdemeanor punishable by a $100,000 fine and up to a year in prison.

A conviction for embezzlement of public funds will typically also be accompanied by an order to pay an amount equal to what was embezzled as restitution.

Interesting Facts About Embezzlement

Embezzling funds from a financial institution such as a bank is both a state and federal crime. If the person involved is an officer or teller at a federally insured bank, he or she may be on the hook for more stringent federal penalties if convicted of embezzlement.

Despite being illegal, money or property gained through embezzlement is taxable. The Internal Revenue Service wants its share of the proceeds of a successful state or federal embezzlement scheme. Failing to pay taxes can get you in trouble with the IRS; however, paying taxes on illegally gotten gains can alert federal authorities to financial fraud. The silver lining? You may be eligible for a tax refund on money paid in if you are ever forced to give back the money or property through restitution.

Ex-bank worker charged with fraud, embezzlement in New Mexico

Officials say he was supposed to be depositing customer’s money into their bank account. Instead a former bank employee is accused of forging customer checks and pocketing the cash.
Ray Perez, 28, is charged with fraud and embezzlement.
Investigators say Perez forged checks in the name of Albuquerque Bank of the West customers, some of whom are elderly.
Police say Perez took nearly $4,500.
Bank of the West reimbursed the customers who were victims.
The bank says Perez was fired before the fraud was uncovered on unrelated matters.
Perez has bonded out of jail.

Saturday, April 27, 2013

Former Adams Municipal Employees Federal Credit Union manager Patricia Piscioneri gets 1 day in prison, supervised release, on embezzlement charge in Massachusetts

An Adams woman was sentenced on Thursday in U.S. District Court for embezzlement and other related charges.

Patricia Piscioneri, 67, was sentenced by Judge Michael A. Ponsor to one day in prison, followed by two years of supervised release, the first six months of which must be spent in home confinement, 100 hours of community service, and a $3,000 fine.

In January, Piscioneri pleaded guilty to a 30-count indictment charging her with embezzlement of funds by a credit union employee and false entries.

While employed as the manager of the former Adams Municipal Employees Federal Credit Union, Piscioneri embezzled credit union funds by creating fraudulent loan accounts in the names of credit union members and depositing the proceeds of these fraudulent loans into her own account(s), her husband’s account(s), other family members’ account(s), or used the proceeds to pay off earlier obtained fraudulent loans.

In an attempt to avoid detection, Piscioneri created fraudulent loan documentation, such as loan applications and promissory notes and forged signatures on these documents, created false entries in the credit union's accounting system, and advanced the payment due dates of the fraudulent loans.

U.S. Attorney Carmen M. Ortiz and Richard DesLauriers, special agent in charge of the FBI Boston Field Division, made the announcement of the sentencing. The case is being prosecuted by assistant U.S. attorney Michelle L. Dineen Jerrett.

Friday, April 26, 2013

Former Georgia bank teller sentenced in embezzlement

A former bank teller has been sentenced to four years in prison on identity theft and embezzlement charges.

U.S. Attorney Michael Moore, of the Middle District of Georgia, says 26-year-old Victoria Metz is also ordered to pay more than $79,300 in restitution to Colony Bank. Authorities say Metz worked as a bank teller in Leesburg — about 10 miles north of Albany — and cashed $79,361 worth of stolen checks from the Internal Revenue Service.

Metz told investigators she occasionally was given a cut of the proceeds from a third party who supplied her with the stolen checks.

Aside from prison time and restitution, Metz is ordered to serve three years of supervised release.

Bridgeport, California bank manager arraigned for embezzlement

Roxanna Foley, 52, of Bridgeport, was arraigned today in federal court in Sacramento.
She was indicted on April 18 by a federal grand jury on charges of theft and “embezzlement by a bank employee,” according to the U.S. Attorney’s Office.
The indictment alleges that Foley embezzled approximately $320,000 from Eastern Sierra Community Bank over a four-month period.
She was employed at the bank as a manager.

Chula Vista, California Banker at Wells Fargo Branch Charged With Defrauding Bank and Customers

A Chula Vista banker was charged with defrauding Wells Fargo and several of its customers by stealing and laundering about $775,000 from Wells Fargo customer accounts, according to a federal indictment unsealed Thursday.

Ricardo Adolfo Benavente III faces 80 felony counts, including bank fraud, embezzlement and aggravated identity theft. He pleaded not guilty at his arraignment today.

According to the indictment, Benavente, a banker at a Wells Fargo branch office in Chula Vista, used his access privileges at the bank to move hundreds of thousands of dollars from the accounts of Wells Fargo customers into accounts he controlled.

The indictment further alleges that in many instances Benavente laundered the stolen funds in order to disguise the fact that he had stolen them.

Between April and October of 2009, Benavente stole the funds from the accounts of four Wells Fargo customers, according to the indictment.

Benavente, 27, allegedly funneled the stolen funds through various Wells Fargo accounts that he created and controlled, and which he had opened in the name of fictitious customers expressly for the purpose of conducting a scheme to defraud.

In one case, Benavente allegedly funneled stolen funds through a PayPal account that he had set up in the name of one of his victims, in order to disguise the fact that the money had been stolen.

Benavente then used the PayPal account to direct the funds to his own bank, the indictment states.

The indictment alleges that in furtherance of the fraud scheme, Benavente stole and used the names and account numbers of his various victims in order to create the appearance that the transactions were being conducted by the customers themselves.

Benavente also created a trail of fraudulent bank instruments, such as withdrawal slips and cashier's checks, which he used to steal money from his victims' accounts and direct those funds to accounts he controlled, the indictment alleges.

Wednesday, April 24, 2013

Prosecutors say former Northern California bank manager facing prison in embezzlement case

Federal prosecutors say a former manager of a rural Northern California bank is facing up to 30 years in prison for allegedly embezzling hundreds of thousands of dollars.
A spokeswoman for the U.S. attorney's office in Sacramento says 52-year-old Roxanna Foley is free on a $50,000 bond after a federal grand jury returned an indictment charging her with theft and embezzlement.
Prosecutors say between October 2011 and March 2012 Foley embezzled about $320,000 from the Eastern Sierra Community Bank in Bridgeport, where she was employed as a manager.
U.S. attorney's spokeswoman Lauren Horwood said Wednesday that Foley is scheduled to appear in court on May 29 for a status conference.
It was not known if Foley had retained an attorney.
Bridgeport is a community of several hundred people in remote Mono County, about 120 miles south of Reno, Nevada, or about 350 miles north of Los Angeles.

Ex-bank teller blames love for why he embezzled $10,000 in Ohio

“I did it for love.”
That’s the reason a former Chase Bank teller gave a judge yesterday to explain why he stole $10,000 from the bank.
“I was in a relationship, and I didn’t have any money,” Imran Z. Cheema, 24, said before he pleaded guilty in federal court to one count of embezzling. He said he wanted to impress his girlfriend with the money.
Cheema, who now lives in Tampa, Fla., worked at the bank’s Northern Lights office at 3233 Cleveland Ave. Just before he quit last summer and moved to New York, he took the cash from a teller cash dispenser and “put it in my pocket,” he told U.S. District Judge Michael H. Watson.
According to a Secret Service criminal complaint, Cheema’s theft was discovered during an audit a week after he left. The audit found that the dispenser, which tellers use to refill the cash in their drawers, was short $10,000. Surveillance video showed Cheema at the dispenser when cash was removed on July 12 and on July 13, the day he left.
When an investigator spoke by telephone with Cheema on July 25, he said he was in Pakistan, his homeland. But investigators learned from a witness that Cheema was in New York, and that’s where he was arrested on Aug. 2.
Cheema has repaid the $10,000. He said he is living in Florida with his brother because “my brother didn’t want me to get into any more trouble.” He said his father is buying a gas station in Florida so Cheema can work there.
Cheema could be sentenced to 30 years in prison and ordered to pay a $1 million fine for embezzlement. But Watson said that, based on the amount of money stolen and Cheema’s lack of a criminal record, his prison sentence likely will not exceed six months.
Watson asked Cheema if he still has the same girlfriend.
“No, your honor,” he replied.

Woman embezzled more than $129,000 from First National Bank, prosecutors say in Pittsburgh

A Spring Hill woman embezzled more than $129,000 from First National Bank while she was an assistant branch manager and head teller between 2008 and 2011, federal prosecutors say.
A federal grand jury on Tuesday indicted Diana Phillips, 39, on charges of bank embezzlement and making false entries in bank records. The indictment doesn't say what branch of the bank she worked at.
There was no listing for Phillips and no attorney listed for her in court records.

According to the indictment, Phillips was an assistant branch manager and head teller at First National Bank. Over a period of roughly three years, Phillips embezzled approximately $129,318.38 from the bank by processing fictitious general ledger transactions and making cash-in deposits into an account owned by a family member. The defendant then transferred money from the family member’s account into accounts controlled by her and/or her husband.

Sunday, April 21, 2013

Bank employee pleads guilty to embezzlement in North Carolina

Betty Lee Johnson, 40, of Bennettsville, pled guilty Tuesday in federal court to Theft by Bank Employee, according to United States Attorney Bill Nettles.

Johnson worked for First Citizens Bank as a teller in the bank's Clio branch. A surprise audit, conducted on December 15, 2011, revealed that the Johnson's bank drawer and the vault were missing $206,500.00.

The investigation revealed that Johnson had been embezzling money from June 2006 to May 2011.

Nettles stated the maximum penalty Johnson can receive is a fine of one million dollars and/or imprisonment for 30 years, plus a special assessment of $100.

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.

Former Bank CEO Pleads Guilty to over $600K in Bank Fraud and Money Laundering in Mississippi

Larry Hill,of Mississippi, pled guilty in U.S. District Court to bank fraud and money laundering. Larry Hill served as CEO of People’s Bank of the South in Bude, Mississippi. From 2004 through 2012, he fraudulently withdrew money from the bank’s Payroll Clearing Account and deposited those funds into the bank accounts of his family members and into a “shell” bank account he created for his personal benefit and the benefit of others.

The total amount of loss in this case is still being calculated but is estimated to be from $600,000 to over $1 million.

Thursday, April 18, 2013

Former Webster, New York teller faces embezzlement charges

A former bank teller from Wingdale, N.Y., appeared Monday in Bantam Superior Court on charges she stole $5,000 from a bank customer's account.

Margo Schneider, 31, of 8 White Road, Wingdale, was employed as a teller supervisor by Webster Bank at its Boardman Terrace branch at 53 Main St., New Milford, in the summer of 2007 when she forged withdrawal slips, police said.

An investigation was launched after a bank customer walked into the bank claiming she was missing $5,000 in funds. The funds were later restored to the account by the bank, according to a court affidavit.

Schneider has been charged with larceny by embezzlement. A warrant was prepared for her arrest in 2009, but her appearance was delayed because of extradition proceedings. 

Ludington, Michigan woman gets prison for nearly $1 million bank embezzlement

 Stacy Lynn Ahlgren, a former employee of Northwestern Bank in Ludington, has been sentenced to federal prison for embezzling nearly $1 million from the bank over nearly six years.
U.S. District Judge Robert J. Jonker on Wednesday, April 17, ordered Ahlgren, 39, to prison for 27 months, followed by supervised release for three years. He also ordered Ahlgren to pay restitution of $873,589.76, the amount that is documented to have been stolen.
According to court documents, the prison sentence was at the low end of federal sentencing guidelines, which recommended a range of 27 to 33 months.
In a sentencing memorandum filed with the court last week, Ahlgren’s attorney, Larry C. Willey, asked for a sentence below the guidelines. Willey argued that Ahlgren had been influenced by a bad marriage with an abusive husband, whom she tried to make happy by financing his “lifestyle.” 
The ex-husband, Garth Allen Kimbler, whom she divorced in 2012, is in state prison for weapons and vandalism convictions in connection with a November 2011 attack on his then-wife.
Willey’s memorandum said Stacy Ahlgren’s salary from the bank, where she worked as a senior customer service representative and had access to its vault, was $18,500 per year throughout the period of the embezzlement, 2006 through 2011.
But Assistant U.S. Attorney Robert M. Stella responded that Ahlgren, then known as Stacy Lynn Kimbler, had many opportunities to “make the right choice” by stopping her criminal conduct but failed to do so.
Stella’s sentencing memorandum said she used most of the stolen money to support her husband’s alcohol, drug and gambling habits, as well her own gambling, which Stella said by her own admission accounted for more than $100,000 in spending during the embezzlement period. Stella said that, according to the record, her husband had no knowledge of her theft.
Ahlgren pleaded guilty Dec. 20 to embezzlement from an insured bank, a federal crime. According to Stella’s sentencing memo, $100,000 of the stolen money was paid by the bank itself, the rest by its insurer.
In her plea agreement with the U.S. Department of Justice, Ahlgren admitted embezzling $873,589.76 from the bank from 2007 through 2011, with the amounts rising each year from $140,866.45 in 2007 to $188,591.52 in 2011.
According to the plea agreement, Ahlgren worked at two branch locations of Northwestern Bank in Ludington. By 2006 she was the senior customer service representative, giving her sole responsibility over the bank vault in the branch at 101 E. Court St.
According to the plea agreement, at least weekly she stole cash, cashier’s checks and money orders from her teller drawer in an area she knew was not caught on security cameras. She concealed the scheme by preparing false bank-vault audit sheets and by periodically falsifying the vault balance in the bank’s computer system.
According to Willey's sentencing memo, bank officials became suspicious in December 2011 and did an audit at the Ludington branch. During the audit Ahlgren admitted her embezzlement to a fellow employee, repeated it to bank officials and again repeated it to local police the same day, Willey said.

Wednesday, April 17, 2013

Bank worker Paul Jennings jailed for £122,502 embezzlement in England

A former bank worker has been jailed for embezzling £122,502 of customer's cash to fund his gambling habit.
Paul Jennings, 33, from Clydebank, West Dunbartonshire, transferred cash from 13 dormant customer accounts between July 2008 and April 2011.
He was caught when two customers at the Halifax Bank of Scotland branch, on Dumbarton Road, Glasgow, came forward after noticing money was missing.
Jennings was jailed for 35 months after pleading guilty to embezzlement.
At Glasgow Sheriff Court, former customer manager Jennings also admitted a charge of failing to turn up to an earlier court appearance.
Vulnerable targeted
Passing a sentence, Sheriff John Baird said: "You targeted deliberately the accounts of people you knew to be elderly and vulnerable."
The court heard Jennings transferred money out of the different accounts over the three year period to use for his gambling addiction.
One customer came forward when they noticed money was missing and Jennings initially denied any involvement despite his initials being on the withdrawal slip, but the full extent of his crime was not discovered.
When another customer came forward further investigations were made.
Defence lawyer Tom Williamson said that after joining the bank in 2003, Jennings moved to the Dumbarton Road branch in 2006.
He said: "After that he developed a chronic gambling addiction."

Employer Blames Casino for $4 Million Embezzlement

 A candy wholesaler sued an Ameristar casino for $4 million, claiming it "enticed and enabled" a worker who embezzled the money and blew it on slot machines.
     Colombo Candy & Tobacco Wholesale Co. dba Colombo Distribution sued Ameristar Casino Council Bluffs in Douglas County Court, Tulsa.
     It claims its employee, Jane Doe, blew more than $3 million of the $4 million she embezzled at the Ameristar casino in Council Bluffs, Iowa.
     Colombo claims Doe worked as its controller from July 2010 to July 2012. Doe, who is not a party to the case, was in charge of all company finances until it discovered her massive theft and fired her, Colombo says in the complaint.
     "Doe accomplished her embezzlement by taking advantage of her position
     as controller to, among other things, inflate inventory and accounts receivable, and manipulate payroll," the complaint states. "Doe used Automated Clearing House ('ACH') transactions to deposit the embezzled funds into Doe's own accounts, against which she then cashed checks at Ameristar, made cash withdrawals at Ameristar and otherwise transferred the money to Ameristar.
     "Doe has entered into a settlement agreement that admits to the embezzlement from plaintiff, and admits to liability to plaintiff. Doe has signed a Stipulation for Judgment and a Judgment by Confession granting plaintiff a judgment against Doe in the amount of four million ninety-nine thousand four-hundred one and 55/100 dollars ($4,099,401.55). Doe cannot repay the amount embezzled or stolen from plaintiff.
     "Doe's annual salary from plaintiff was only approximately $62,000 per year. Yet in 2011 alone, Doe lost in excess of $1,750,000 to Ameristar.
     "Ameristar knew the money Doe was using to gamble was embezzled or stolen or had information that would lead a reasonable person to believe the money Doe was using to gamble was embezzled or stolen."
     Colombo Candy claims the casino regularly cashed $10,000 checks for Doe.
     "For example, within the two-week period between February 22, 2011 and March 7, 2011, Ameristar cashed 16 checks for $10,000 each, for a total of $160,000. Over the Labor Day weekend of 2011, Ameristar cashed checks totaling $100,000 for Doe," the complaint states.
     "Ameristar patrons specifically asked Ameristar cashiers what the source of Doe's funding was.
     "Ameristar deliberately closed its eyes to the source of Doe's funding that Doe transferred to Ameristar in order to gamble, in order to avoid meaningful exposure to information that would have provided Ameristar with knowledge of Doe's embezzlement of Plaintiff's money."
     Impressed by Doe's big spending, Colombo says, the casino treated her like a VIP.
     "Ameristar gave special privileges to Doe, including permitting her to go behind the cashier's 'cage' where patrons generally are not permitted in order to obtain cash. Doe would routinely obtain cash in $10,000 increments several times a night.
     "Ameristar deliberately acquired video-slot machines to induce protracted high-risk gambling for Doe, modifying particular video-slot machines specifically for Doe on at least three occasions to increase the amount of money Doe could spend on a single 'spin' or game. Ameristar, on at least one occasion, upon getting a new or modified machine, called Doe and held the machine 'off limits' to other patrons until Doe could be the first to play it.
     "Ameristar's video-slot machines are designed to create and enhance an illusion of control over the outcome of the 'spin' or 'game played,' and Ameristar actively encouraged that belief by pointing out to Doe which machines had recently paid out a 'jackpot.'
     "Ameristar knew which video-slot machines were set to pay out at specific return rates and on multiple occasions Ameristar staff tipped off, or otherwise advised and steered Doe toward specific video-slot machines to play or avoid.
     "Ameristar staff would, when Doe was losing money at a particular machine, direct her to another machine where she usually had a prompt 'win.' Ameristar staff would give machines Doe was using a 'rub' for luck.
     "Ameristar staff would watch Doe gamble, including the cashiers who would leave the 'cage' to watch. Ameristar used multiple versions of the same 'game' with different 'pay-back' percentages, concealed from Doe and distorting her understanding of how the machines work.
     "Ameristar employees would guard machines Doe was using so that she could leave to use the bathroom and come back to the same machines."
     Colombo claims that Doe became so notorious at the casino that its "floor staff would monitor Doe's gambling to predict when she would next be coming in, and seek to change their own work schedules so as to be working when Doe was gambling in order to personally profit from her tips."
     Ameristar cashed $3 million in checks for Doe in 2011 alone, Colombo claims.
     Although the casino "has policies and procedures to detect and aid problem gamblers," and knew Doe was a problem gambler, it "intentionally ignored its own policies, and intentionally refused to talk to Doe about her problem gambling," according to the complaint.
     "Ameristar's excessive and extraordinary inducement of Doe to gamble, Ameristar's willful blindness to the source of Doe's funds she used for gambling, and Ameristar's failure to follow its own policies caused or substantially contributed to Doe's embezzlement from plaintiff and plaintiff's transfer of funds to Ameristar," the complaint states.
     Colombo Candy seeks restitution, an accounting of all the money Doe blew at the casino, and damages for aiding and abetting, fraudulent transfer and unjust enrichment.
     It is represented by Jill Robb Ackerman with Baird Holm of Omaha, Neb.

Tuesday, April 16, 2013

Bank employee accused of embezzlement readies guilty plea in Indiana

A former customer service manager for Greensburg’s Fifth Third bank notified authorities of her intent to enter a guilty plea on federal embezzlement charges earlier this week.

Michelle Wagner, 41, was investigated by federal agents who claim she stole more than $300,000 from a pair of senior citizens’ accounts while working as a customer service manager at Fifth Third. In total, investigators believe Wagner pocketed $344,918.08 over the course of 18 months.

U.S. Attorney for the Southern District of Indiana Joe Hogsett told the Daily News Friday that Wagner and her attorney have formally notified the federal court system of their intent to enter a guilty plea. That plea, if entered and accepted by the court, will eventually be followed by a sentencing hearing. Hogsett said Wagner could face a maximum penalty of 20 years in federal prison time, in addition to “significant fines” and a period of supervision following her release. Wagner has no prior criminal history, he said, and the suspect’s choice to avoid a trial could potentially reduce her sentence. But that’s up to the judge, he said.

One unavoidable outcome of the case will be Wagner’s requirement to repay every cent she is alleged to have stolen.

Hogsett said he could not comment on (and didn’t have access to) a list of items purchased by Wagner using the embezzled funds.

“That information will be revealed at the sentencing,” Hogsett said. The items purchased were described as being “for her (Wagner’s) personal use.”

Hogsett said items bought by Wagner using the victims’ funds would be sold, and the proceeds of those items would be returned to the Fifth Third customers as restitution.

The U.S. attorney complimented the efforts of Federal Investigators as well as Fifth Third’s own investigative team whose assistance Hogsett described as “extraordinarily cooperative and helpful.”

Wagner’s work as a customer service manager gave her complete access to her client’s accounts. Part of her duties, Hogsett said, included assisting the two victims with writing checks, paying monthly bills and other expenses, transferring funds, and maintaining their accounts in general. The multiple unauthorized transactions are alleged to have occurred over a period of time spanning from July 2010 until early December 2011.

Hogsett said his office is determined to send the message that they “take very seriously those who abuse the public trust.”

Wagner’s alleged actions took many by surprise, as Hogsett said neither Fifth Third nor the customer service manager’s clients had reason to believe the suspect was anything less than honest.

Wednesday, April 10, 2013

Former Manager of Huntington National Bank in Ohio Arrested for Embezzling $1.7 Million

 A Mansfield man was sentenced to more than four years in prison and ordered to pay more than $2 million in restitution after previously being found guilty of bank embezzlement, tax charges, and bank fraud, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Kevin J. Moore, age 37, was sentenced by United States District Court Judge Christopher Boyko to 51 months’ incarceration. Moore previously pleaded guilty to six counts of a criminal information.
The first count charged that from August 2008 to November 2010, Moore, while he was the manager of Huntington National Bank (HNB), in Mansfield, Ohio, embezzled approximately $1.7 million from HNB. Moore was also charged in three other counts with tax evasion in failing to report and pay taxes on the monies he had embezzled and used for his own personal benefit.
In addition, Moore was charged in another count with wire fraud for defrauding an individual of more than $360,000 in an phony investment scheme. Moore was also charged with bank fraud for opening lines of credit in Randy Meister’s name and fraudulently drawing on those lines while Moore was the manager of the Mansfield, Ohio branch of KeyBank from the fall of 2007 to the spring of 2008.
Meister pleaded guilty to misprison of a felony in concealing this bank fraud from investigator.
The information’s count one, charging embezzlement from Huntington National Bank, alleged that Moore met with bank customers who wanted to open or renew a CD or annuity account and would embezzle their money and provide these customers with a print-out that he had manufactured that falsely reflected the amount of the invested funds and earnings rate, when, in fact, the defendant had stolen these funds and there was no investment.
When CDs would come up for renewal, Moore would contact the CD customers and entice those customers to renew their CDs by offering them an inflated interest rate even though the defendant had no authority from the bank to offer such rates, and, in fact, no interest rates were to be paid on these CD investments since the defendant had stolen these funds. When a customer wanted to cash out his or her CD where defendant had stolen the funds, Moore would “flip” money from another CD customer’s account to be able to cash out that account, according to court records.

The information charged that Moore would withdraw all the CD and annuity funds he had stolen in the form of cash by falsely telling bank tellers the customers were waiting in his office to pick up these funds. In fact, according to the information, this was only a ruse perpetrated by Moore to allow him to steal, and use for his own personal benefit, the cash he had received from the tellers.
The information charged that, from on or about August 2008 to on or about November 2010, Moore stole approximately $1.7 million from HNB and its CD and annuity customers. In connection with this embezzlement scheme, the information also charged Moore with three counts of tax violations for evading his taxes for calendar years 2008, 2009, and 2010, resulting in a tax due and owing of more than $512,000. This does not include any penalties or interest owed to the I.R.S., which is subject to assessment in civil or administrative proceeding.
The information also charged that Moore committed wire fraud by defrauding an investor from 2004 through 2008 of more than $360,000. The information charged that Moore approached R.R., who was a member of the church where defendant’s father was the pastor and where defendant was an assistant pastor, and informed R.R. that he and his family was actively involved in making investments, including “day trading” (buying and selling securities within a short period of time, usually within a day, in order to secure a quick profit by any increase in trading price during that short period of time; to secure any kind of significant profit, it usually requires multitudes of day trades with securities experiencing “up ticks” in their daily trading prices).
Moore represented to R.R. that R.R. could invest $250,000 a four-year trading program and receive a return of $5,000 per month for 48 months, at which time R.R. would receive the return of his original $250,000 investment. On or about August 13, 2004, R.R. cashed out his 401K pension fund and gave Moore a check for $250,000 to invest in the above-mentioned four-year trading program, according to court documents.
On or about November 24, 2004, Moore, upon finding out R.R. owned stock, approached R.R. and convinced him to sell his stock and invest an additional $118,000, again promising a substantial return on this investment. In fact, there was no investment and the defendant used these funds for his own personal use and benefit. When R.R. requested payment from Moore, he would attempt to lull R.R. into a false sense of security in order to prevent R.R. from complaining to law enforcement officials, by paying him small amounts of money over a period of time and by telling R.R. false stories, including false statements that Moore was associated with individuals who were being murdered by organized crime criminals; that Moore and his family were in danger; and that Moore was already working with law enforcement in this organized crime case, according to court records.
In a separate bank fraud charge, the information alleged that, while Moore was the manager of KeyBank in Mansfield, Ohio, Moore had made fraudulent deposits into credit lines established at KeyBank in Meister’s name. Initially, Meister was unaware that Moore had opened these lines of credit under his name. Meister later assisted Moore in cashing out advances on the lines of credit prior to Key Bank’s discovery of allegedly false deposits. Meister was charged with misprison of a felony for allowing his name and real property to be used to establish the relevant bank accounts, assisting Moore in obtaining cash from fraudulent withdrawals from Meister’s lines of credit, and concealing Moore’s bank fraud from the proper authorities.
This case is being prosecuted by Assistant U.S. Attorney Robert J. Patton and Assistant U.S. Attorney Christian H. Stickan after an investigation by the Mansfield Resident Agency of the Federal Bureau of Investigation and the Internal Revenue Service, Criminal Investigation Division, in Cleveland, Ohio

Bank vice president indicted for embezzlement in Texas

A Houston man has appeared for arraignment in a 12-count indictment alleging bank embezzlement, United States Attorney Kenneth Magids on announced today.
A federal grand jury returned the sealed indictment against Shawn Nelson, 39, on Feb. 20. He was arrested Friday, March 22, made his initial appearance the following Monday and was arraigned on Thursday by U.S. Magistrate Judge Frances Stacy. He was permitted release pending further criminal proceedings.
According to the indictment, Nelson was a vice-president of lending at Members Choice Credit Union. From 2001 through 2009, Nelson allegedly opened signature loan accounts in his friends’ and family members’ names without their authorization and subsequently began withdrawing money from those accounts. By the time the fraud was discovered, Nelson had withdrawn more than $340,000, according to allegations in the indictment.
If convicted, he faces up to 30 years in prison as well as a possible $1 million fine for each count. The United States is also seeking forfeiture of approximately $340,000.
The investigation was conducted by the U.S. Secret Service. The case is being prosecuted by Assistant United States Attorney Sharad S. Khandelwal.

Former teller receives probation in embezzlement in Connecticut

Two widely differing pictures were painted in court Tuesday of former credit union teller Yolanda O’Keefe.
Joyce McElhaney, president and CEO of Connecticut Community Credit Union, called O’Keefe “cunningly deceitful” and “a habitual thief” who embezzled more than $20,000 from the credit union’s branch at The Great Cedar Hotel at Foxwoods Resort Casino over a two-year period.
O’Keefe herself and her lawyer, Fred DeCaprio, described the 62-year-old Norwich grandmother, who has had with no previous brushes with the law, as sorry and ashamed about what she did.
A family member has repaid all the money O’Keefe stole, DeCaprio said.
He said she embezzled from her 14-year employer to feed a gambling addiction and because of financial problems caused by her husband being laid off from his job at Electric Boat.
Judge Susan Handy granted O’Keefe’s request for accelerated rehabilitation, a special form of probation. It means if she stays out of trouble for the next two years, the first-degree larceny charge against her will be dropped and she will have a clean record.
O’Keefe was arrested Sept. 25, after it was discovered that $100 bills in the middle of stacks of cash in the vault and in
O’Keefe’s teller drawer had been replaced with $1 bills, Assistant State’s Attorney Lawrence Tytla said.
He said $20,790 was taken from the vault and $810 from the teller’s drawer.
Even though the stolen money has been repaid, McElhaney said, the credit union’s “valued reputation has been compromised,” costing it accounts by depositors who might have lost confidence in it.
“She did not just steal from the vault, she stole from people,” McElhaney said. “She destroyed the morale of the staff and brought unwanted media attention.”
McElhaney said she believes O’Keefe turned down a promotion so she could stay a teller and continue to have access to the branch’s cash.
O’Keefe denied that claim, saying she preferred being a teller.
DeCaprio said O’Keefe was more desperate than calculating.
"I don’t see her as the manipulative person she’s been portrayed as,” he said.
Handy told O’Keefe that she will have to attend and complete a Gamblers Anonymous program and perform 50 hours of community service. She also is banned from the credit union, casinos and other gambling establishments. And for the two years of her probation, she will have to tell future employers what she did.
DeCaprio said because she has been required to disclose that already, O’Keefe hasn’t been able to find a new job after getting fired from the credit union.
“I’m really, deeply sorry for what I did,” O’Keefe said. “At 62, I never thought I’d find myself in this position. … I just want my life back, to get a job and start respecting myself again.”

Thursday, April 4, 2013

Bank Official Pleads Guilty To Embezzlement in Nebraska

A former executive at a western Nebraska bank has pleaded guilty to stealing almost $1.4 million from the branch he ran.

     Matthew Monheiser pleaded guilty in federal court Friday to stealing $1,364,953.66 from the former First
National Bank in Sidney.

     The 38-year-old says he has already repaid $500,000 to the bank and made arrangements to pay another $1 million in restitution.

     Prosecutors say Monheiser took the money between 2003 and 2012. Most of the money was obtained by creating loans or issuing cashier's checks in customers' names, increasing existing loans or creating new
loans in customer names.

     Monheiser also took $82,000 in cash from the bank vault.

     Monheiser is scheduled to be sentenced on June 24. Prosecutors agreed to recommend a sentence at the low end of the recommended range.

A former Sidney bank executive now says a gambling addiction drove him to steal more than a million dollars.
Matt Monheiser pleaded guilty in federal court last week to embezzling more than $1.3 million from what is now known as Points West Community Bank in Sidney.
He shared how deep the addiction became saying, “The best way I can explain it is that it consumed me as much as someone who does drugs, alcohol or smoking. Gambling took my career and almost my life away from me. I needed treatment in the worst way, but like most addicts you don’t know you need help until you hit rock bottom.”
After the embezzlement was discovered last August, Monheiser was relieved of his duties and treated at a wellness center in Virginia.
The bank has been re-paid in full, plus $136,000 in interest for a total restitution of $1.5 million according to Monheiser and the current bank president. Monheiser still faces sentencing and a likely prison term June 24.

Witness: Embezzlement suspicions didn't halt loans in Virginia

Bank of the Commonwealth continued making loans to two big borrowers after one of them told a bank official that he suspected his business partner of embezzling $3 million in loan funds, according to testimony Wednesday in a weekslong fraud trial.
George Hranowskyj and his partner, Eric Menden, received some $40 million in loans from the Norfolk-based bank for their real estate business in the years leading up to the bank's collapse in 2011. They are serving federal prison terms after pleading guilty to fraud charges last year.

Now the two are star witnesses in a trial in U.S. District Court in which five defendants, including top bank officials, are charged with conspiring to defraud the bank out of $71 million.

Hranowskyj testified Wednesday that in January 2009, he went to Stephen Fields, a bank vice president, with his suspicions that Menden had been siphoning money from construction loans the two had received.

Fields, one of the defendants in the case, was the loan officer on most of Menden's and Hranowskyj's business deals.

Hranowskyj said he laid out his suspicions in a letter to Fields, which he hand-delivered in his bank office and watched as Fields read it.

"He looked a little bit shocked," Hranowskyj said. "He slid the letter back to me and told me that if he were to go forward with it, it would bring down my economic world."

Hranowskyj said he then took the letter back and put it in his pocket. He said his suspicions about embezzlement by his partner eventually led to a bitter split between the two.

Meanwhile, the bank continued to extend millions of dollars in loans to the pair, Hranowskyj said, including $1.2 million to buy a beach house on the Outer Banks.

Menden testified earlier in the trial that he and his partner both took hundreds of thousands of dollars from construction loans for their personal use.

Hranowskyj acknowledged on cross-examination that Fields never asked him to hide anything to get a loan and on some occasions advised him against making questionable investments.

Another prosecution witness, Kevin Roberts, a former loan officer at the bank, described a $1.3 million loan to Dr. Nickolas Pezzella, a Chesapeake physician, for the purchase of three bank-owned properties.

Pezzella is Menden's cousin. Menden testified earlier that he and his partner bought bank-owned properties as a favor to get them off the bank's list of troubled assets. When he reached his legal borrowing limit, Menden said, he used straw buyers such as Pezzella, who were buyers in name only. Pezzella has not been accused of any wrongdoing.

In return for doing such favors for the bank, Menden and Hranowskyj have testified, they expected and received favorable treatment, including low interest rates, loans with no money down, and tolerance of late payments and overdrawn accounts.

Roberts testified that he was assigned to the Pezzella loan at the direction of Fields and another bank vice president, Simon Hounslow, also a defendant in the case.

He said that at Menden's request, the Pezzella loan was structured so that the entire amount - including funds intended for rehabilitation of the properties - was paid out at closing. That was unusual, he said: Normally, rehabilitation funds would be paid out as the work was done.

The loan later drew scrutiny from federal bank examiners, he said.

At one point, Roberts said, Hounslow called a meeting and demanded to know: "Who instructed you to do the loan this way?"

Roberts said he responded: "You did."

Roberts testified that he was subsequently fired by Hounslow.

Another government witness, Charlene Spadaccini-Moye, a former loan assistant at the bank, described processing favorable modifications to loans for the foundering real estate investments of Brandon Woodard, the son of bank President and CEO Edward Woodard Jr.

Both Woodards are defendants in the case.

The loan modifications included a two-year extension, a lower interest rate and an increase in the principal to cover payment of back taxes, insurance and escrow reserves. The latter provision was unique in her experience, Spadaccini-Moye said.

Testimony in the case continues today.