Two executives from a defunct Arizona mortgage lender received drastically different federal prison sentences Friday for swindling North Dakota-based BNC National Bank out of at least $26 million at a time when financial institutions were reeling from the national mortgage crisis.
Scott Powers and David McMaster pleaded guilty in October to conspiracy to commit bank fraud and wire fraud. Powers was the CEO of American Mortgage Specialists Inc., or AMS, and McMaster was the company's vice president in charge of lending operations.
In separate sentencing hearings in Bismarck, U.S. District Judge Daniel Hovland gave McMaster 15 years and six months in prison, and Powers eight years. Several employees from the bank were at the hearings.
Powers reportedly was given credit for cooperating with authorities. McMaster's lawyer said his client owned up to the charges and deserved better.
"I am hopeful that the BNC people have closure, but I am disappointed in the sentence," McMaster's defense attorney James Belanger told The Associated Press. "David McMaster took responsibility for his actions, agreed to plead guilty, and knew that he would face a term in prison."
The length of McMaster's sentence undermines the concept of responsibility in criminal cases and "underscores the irrationality" of federal sentencing guidelines, Belanger said.
Powers' attorney, Patrick Sampair, was not immediately available for comment.
Authorities say AMS defrauded the bank by providing it with false financial statements and other information about the status of loans the bank had financed. A printout obtained by a BNC employee in April 2010 showed that about $565,000 of loans remained to be sold, rather than the approximately $27 million of loans shown as being held for sale to investors.
Documents show that BNC's holding company received about $20 million from the federal Troubled Asset Relief Program, or TARP, in January 2009. About $18 million of that went to the bank. Investigators say BNC did not make its required TARP dividend payments to the government between February 2010 and December 2011.
At that point, BNC ceased funding the loans, and AMS shut its doors.
"Mr. McMaster and Mr. Powers stole $28 million from BNC banks, putting the jobs of the people who work there at risk," U.S. Attorney Timothy Purdon said. "Further, because of the TARP payments BNC had received, they also put the American taxpayer at risk."
The plea agreements call for Powers and McMaster to pay back more than $28.5 million to the government and more than $28.5 million to the bank.
Two other people were indicted in the case. Lauretta Horton, former director of accounting with AMC, and David Kaufman, an independent auditor, pleaded guilty and were sentenced to probation. Horton was charged with conspiracy to commit bank and wire fraud. Kaufman was charged with obstruction of justice.
BNS is based in Bismarck with offices in several states, including Arizona. Bank CEO Gregory Cleveland did not return a phone message Friday.
Friday, June 28, 2013
Thursday, June 27, 2013
Former Montgomery County Credit Union CEO Gets Retrial In Embezzlement Case in Pennsylvania
The former CEO of a Montgomery County credit union is back before a judge for her retrial on charges that she allegedly used credit union funds to pay some of her personal expenses.
Anne Clyburn was convicted in 2010 of stealing more than $32,000 from the United Food and Commercial Workers Local 1776 Federal Credit Union
She served nine months behind bars, but the conviction was overturned last year and she was granted a new trial.
Prosecutor Steven Latzer says he’s withdrawn some of the charges related to Clyburn allegedly giving herself unauthorized raises and using a credit card to pay charges that weren’t approved by the Board.
She’s accused of cutting credit union checks to pay dental bills for her husband.
The reduced charges involve much less money than the previous conviction. The trial, which opened Thursday morning, is being heard by a judge rather than a jury
Former VP of Lending convicted of bank embezzlement in Texas
Shawn Nelson, 39, of Houston and a former vice-president at Members Choice Credit Union, has entered a plea of guilty to embezzling approximately $340,000 from the bank, United States Attorney Kenneth Magidson announced today.
Court records reflect that Nelson was a vice-president of lending at Members Choice Credit Union in Houston. From 2001 through 2009, Nelson opened signature loan accounts in his friends’ and family members’ names without their authorization and then withdrew money from accounts without their authorization. By the time the fraud was discovered, Nelson had stolen more than $340,000 from the credit union.
U.S. District Judge Keith P. Ellison, has set sentencing for Sept. 26, 2013, at which time Nelson faces up to 30 years in federal prison and a possible $1 million fine. Additionally, as part of his plea agreement, Nelson has agreed to forfeit approximately $340,000.
The investigation was conducted by the U.S. Secret Service. Assistant United States Attorneys Sharad S. Khandelwal and Kristine Rollinson are prosecuting.
Tuesday, June 25, 2013
Bristol bank teller pleads guilty to fraud in Connecticutt
A bank teller accused of stealing from the CD accounts of mostly elderly customers has pleaded guilty to bank fraud.
Federal prosecutors say 35-year-old Michelle Laudato of Farmington pleaded guilty Tuesday in U.S. district court in Hartford.
Prosecutors say Laudato used her position at a Webster Bank branch in Bristol to steal more than $178,000 from the accounts of at least 18 customers between July 2009 and June 2010. Most of the victims were in their 80s and 90s.
Laudato was accused of withdrawing money from CD accounts to replace funds she had taken from others and taking the money in increments of $10,000 or less to avoid transaction reporting requirements. She faces a maximum sentence of 30 years in prison.
Federal prosecutors say 35-year-old Michelle Laudato of Farmington pleaded guilty Tuesday in U.S. district court in Hartford.
Prosecutors say Laudato used her position at a Webster Bank branch in Bristol to steal more than $178,000 from the accounts of at least 18 customers between July 2009 and June 2010. Most of the victims were in their 80s and 90s.
Laudato was accused of withdrawing money from CD accounts to replace funds she had taken from others and taking the money in increments of $10,000 or less to avoid transaction reporting requirements. She faces a maximum sentence of 30 years in prison.
Ariz. woman pleads guilty in embezzlement case at credit union
An Arizona woman has pleaded guilty to embezzling more than $780,000 from the Pinal County Federal Credit Union in Casa Grande.
The Casa Grande Dispatch reports that Jennelle Rena Curtis pleaded guilty to two counts of embezzling from a credit union Thursday as part of a plea agreement.
Court documents show that Curtis embezzled the money in 2009. She worked at the credit union from 2002 until 2011.
As part of a plea agreement, Curtis admitted issuing around 100 bank checks totaling $780,697 for personal use.
Prosecutors will recommend a sentence of between 24 and 30 months for Curtis as part of a plea deal.
Sentencing is slated in September.
The Casa Grande Dispatch reports that Jennelle Rena Curtis pleaded guilty to two counts of embezzling from a credit union Thursday as part of a plea agreement.
Court documents show that Curtis embezzled the money in 2009. She worked at the credit union from 2002 until 2011.
As part of a plea agreement, Curtis admitted issuing around 100 bank checks totaling $780,697 for personal use.
Prosecutors will recommend a sentence of between 24 and 30 months for Curtis as part of a plea deal.
Sentencing is slated in September.
Monday, June 24, 2013
Former Nebraska banker gets 3 1/2 years in prison
A former Sidney banker has been sentenced to three-and-a-half years in prison for embezzling over $1.3 million. Matt Monheiser was handed the 42 month sentence in federal court Monday and he will also serve five years of supervised release after he is out of prison.
The 38-year-old Monheiser was convicted of taking almost $1,365,000 from what was the former First National Bank in Sidney where he was vice president and branch manager. The thefts occurred between March 2003 and August 2012 where he used funds from customers’ loan accounts to buy cashier’s checks in customers’ names. He also created loans in customers’ names and stole $82,000 cash directly from the bank vault.
After pleading guilty last spring, Monheiser told KSID he was addicted to gambling, which fed his embezzlement. He was treated for 28 days at a wellness center in Virginia shortly after the thefts were discovered.
According to the U.S. Attorney’s Office $500,000 restitution has already been paid. Monheiser told us in April that a cash-collateral account has been set up to repay the rest but would not say who funded the accoun
The 38-year-old Monheiser was convicted of taking almost $1,365,000 from what was the former First National Bank in Sidney where he was vice president and branch manager. The thefts occurred between March 2003 and August 2012 where he used funds from customers’ loan accounts to buy cashier’s checks in customers’ names. He also created loans in customers’ names and stole $82,000 cash directly from the bank vault.
After pleading guilty last spring, Monheiser told KSID he was addicted to gambling, which fed his embezzlement. He was treated for 28 days at a wellness center in Virginia shortly after the thefts were discovered.
According to the U.S. Attorney’s Office $500,000 restitution has already been paid. Monheiser told us in April that a cash-collateral account has been set up to repay the rest but would not say who funded the accoun
Saturday, June 22, 2013
Former bank employee admits to embezzling nearly $100K in Rhode Island
A former bank employee pleaded guilty in federal court on embezzlement charges after he stole nearly $100,000 in treasury funds.
Elvy Gomez, 39, of Providence, used to work at Bank of America. He admitted to the court Friday that he used his position at the bank to deposit stolen treasury checks into a dormant checking account, from which he later withdrew the funds.
Prosecutors said Gomez managed to deposit 14 stolen treasury checks into that account in just four months, embezzling a total of $95,559.
He pleaded guilty to one count each of theft of government property, forging an endorsement on treasury checks and money laundering.
Gomez faces up to 10 years in federal prison, three years supervised release and a fine of up to $250,000 on each charge.
Elvy Gomez, 39, of Providence, used to work at Bank of America. He admitted to the court Friday that he used his position at the bank to deposit stolen treasury checks into a dormant checking account, from which he later withdrew the funds.
Prosecutors said Gomez managed to deposit 14 stolen treasury checks into that account in just four months, embezzling a total of $95,559.
He pleaded guilty to one count each of theft of government property, forging an endorsement on treasury checks and money laundering.
Gomez faces up to 10 years in federal prison, three years supervised release and a fine of up to $250,000 on each charge.
Thursday, June 20, 2013
Former head of closed Vt. credit union indicted
The only employee of a small northern Vermont credit union that was taken over last year by federal regulators is now facing embezzlement charges.
Earlier this month a federal grand jury in Burlington indicted Debra Kinney, the CEO of the now closed Border Lodge Credit Union, on an embezzlement charge.
The indictment alleged Kinney did "willfully embezzle, purloin and misapply moneys and funds" of the credit union.
Last November the Vermont Department of Financial Regulation closed the Derby Line-based credit union, which was first chartered in 1963.
An attorney for Kinney did not immediately return a phone call seeking comment.
The former chief executive officer of a Derby Line credit union pleaded not guilty in U.S. District Court in Burlington to accusations she embezzled “several hundred thousand” dollars from customer accounts.
Debra J. Kinney, 58, of Derby Line deposited money from the Border Lodge Credit Union into her Passumpsic Savings Bank account, and she also deposited money in an account for a close friend, the FBI stated in court papers.
U.S. Attorney for Vermont Tristram Coffin said the actual amount of the loss is still being compiled, but he believes when completed it will be at least several hundred thousand.
She and her husband, James, did not respond to questions as they left the courthouse on Elmwood Avenue during the noon hour.
Special Agent Danny Rachek, who directs the FBI in Vermont, wrote in court papers that Kinney was involved in embezzlement and willful misapplication of funds belonging to a credit union insured by the National Credit Union Administration.
Rachek said a state examination showed $207,000 was taken from various member accounts from April 4, 2011, to July 12, 2012, and placed into an account maintained by Kinney’s friends.
Rachek also wrote that $79,108 was withdrawn from member accounts and placed in an account maintained by Kinney and her husband, James Kinney, from June 13, 2011, to June 6, 2012.
The FBI and state regulators closed down the credit union during a court-ordered raid Nov. 30. The offices were at 138 Beauchesne St., primarily in the basement of Kinney’s home, court records state.
Coffin, who is handling the prosecution, said Thursday the credit union remains closed and has been placed in receivership. He said the National Credit Union Administration is serving as the liquidating agent and assessing claims by customers.
Commissioner Susan Donegan of the Vermont Department of Financial Regulation declined Thursday to answer questions about the matter. She referred inquiries regarding what the state has done for customers during the past seven months to a department lawyer, who did not respond.
Court papers cite the credit union’s other full-time employee with blowing the whistle on Kinney’s handling of some accounts. The name of the whistle-blower is not included.
Kinney had written two checks for $20,000 and $10,000 and deposited them into a friend’s account, the FBI stated. The friend is not identified in court papers.
Kinney, when confronted, could not explain the checks, and the money was returned to the original account, the FBI said.
In February 2012, when more problems were uncovered, the state required the credit union to work with an outside accountant to verify the accounts of all members.
Facing the judge
In court Thursday, U.S. Magistrate Judge John Conroy agreed to release Kinney on conditions including that she not be arrested on any new criminal charges and that she possess no firearms.
Conroy approved a request from defense lawyer David Sleigh for 60 days to review the case and file motions.
“It’s voluminous, being a documents case,” Conroy said.
Border Lodge Credit Union initially was chartered by the state in 1963 and insured in 1978. It had about 1,100 members and $3.1 million in assets when raided, the FBI said.
Border Lodge served employees of varied and approved occupational groups who work in Orleans County. Among them was Tivoly Inc., a machine tool company in Derby Line; Newport City Schools; Newport Ambulance; and the town of Derby, the FBI said.
Each deposit is federally insured for up to $250,000.
Stephen W. Kimbell, the former commissioner who shut down the Border Lodge, said in November the state had asked the National Credit Union Association to liquidate the credit union. “Our examiners discovered issues that raised serious concerns,” Kimbell said at the time. “I determined that exercising my authority to take over the credit union was the best way to protect depositors and the assets.”
Border Lodge Credit Union was the eleventh federally insured credit union liquidation in 2012.
Earlier this month a federal grand jury in Burlington indicted Debra Kinney, the CEO of the now closed Border Lodge Credit Union, on an embezzlement charge.
The indictment alleged Kinney did "willfully embezzle, purloin and misapply moneys and funds" of the credit union.
Last November the Vermont Department of Financial Regulation closed the Derby Line-based credit union, which was first chartered in 1963.
An attorney for Kinney did not immediately return a phone call seeking comment.
The former chief executive officer of a Derby Line credit union pleaded not guilty in U.S. District Court in Burlington to accusations she embezzled “several hundred thousand” dollars from customer accounts.
Debra J. Kinney, 58, of Derby Line deposited money from the Border Lodge Credit Union into her Passumpsic Savings Bank account, and she also deposited money in an account for a close friend, the FBI stated in court papers.
U.S. Attorney for Vermont Tristram Coffin said the actual amount of the loss is still being compiled, but he believes when completed it will be at least several hundred thousand.
She and her husband, James, did not respond to questions as they left the courthouse on Elmwood Avenue during the noon hour.
Special Agent Danny Rachek, who directs the FBI in Vermont, wrote in court papers that Kinney was involved in embezzlement and willful misapplication of funds belonging to a credit union insured by the National Credit Union Administration.
Rachek said a state examination showed $207,000 was taken from various member accounts from April 4, 2011, to July 12, 2012, and placed into an account maintained by Kinney’s friends.
Rachek also wrote that $79,108 was withdrawn from member accounts and placed in an account maintained by Kinney and her husband, James Kinney, from June 13, 2011, to June 6, 2012.
The FBI and state regulators closed down the credit union during a court-ordered raid Nov. 30. The offices were at 138 Beauchesne St., primarily in the basement of Kinney’s home, court records state.
Coffin, who is handling the prosecution, said Thursday the credit union remains closed and has been placed in receivership. He said the National Credit Union Administration is serving as the liquidating agent and assessing claims by customers.
Commissioner Susan Donegan of the Vermont Department of Financial Regulation declined Thursday to answer questions about the matter. She referred inquiries regarding what the state has done for customers during the past seven months to a department lawyer, who did not respond.
Court papers cite the credit union’s other full-time employee with blowing the whistle on Kinney’s handling of some accounts. The name of the whistle-blower is not included.
Kinney had written two checks for $20,000 and $10,000 and deposited them into a friend’s account, the FBI stated. The friend is not identified in court papers.
Kinney, when confronted, could not explain the checks, and the money was returned to the original account, the FBI said.
In February 2012, when more problems were uncovered, the state required the credit union to work with an outside accountant to verify the accounts of all members.
Facing the judge
In court Thursday, U.S. Magistrate Judge John Conroy agreed to release Kinney on conditions including that she not be arrested on any new criminal charges and that she possess no firearms.
Conroy approved a request from defense lawyer David Sleigh for 60 days to review the case and file motions.
“It’s voluminous, being a documents case,” Conroy said.
Border Lodge Credit Union initially was chartered by the state in 1963 and insured in 1978. It had about 1,100 members and $3.1 million in assets when raided, the FBI said.
Border Lodge served employees of varied and approved occupational groups who work in Orleans County. Among them was Tivoly Inc., a machine tool company in Derby Line; Newport City Schools; Newport Ambulance; and the town of Derby, the FBI said.
Each deposit is federally insured for up to $250,000.
Stephen W. Kimbell, the former commissioner who shut down the Border Lodge, said in November the state had asked the National Credit Union Association to liquidate the credit union. “Our examiners discovered issues that raised serious concerns,” Kimbell said at the time. “I determined that exercising my authority to take over the credit union was the best way to protect depositors and the assets.”
Border Lodge Credit Union was the eleventh federally insured credit union liquidation in 2012.
Man Pleads Guilty to Conspiracy to Commit Bank Fraud Charge in Georgia
Michael J. Moore, United States Attorney for the Middle District of Georgia, announced that Gary Patton Hall, Jr., 47, of Tifton, Georgia, entered a plea of guilty today to conspiracy to commit bank fraud before the Honorable Hugh Lawson, Senior United States District Judge in Macon, Georgia.
In entering his plea of guilty, Mr. Hall admitted that from 2005 continuing through 2010, he committed bank fraud involving the Tifton Banking Company during his employment as President and CEO of the bank. Mr. Hall admitted that he conspired with others to obtain money, funds, credits, assets, securities, and other property of the Tifton Banking Company while carrying on a practice of replacing non-performing loans with new loans, including a Small Business Administration (SBA) guaranteed loan, to make the bank appear financially stronger than it was. The actions caused monetary losses to the bank and SBA of approximately $2.8 million. Mr. Hall continued these illegal activities even during the time that the bank applied for and received assistance from the Troubled Asset Relief Program (TARP), a government program established to help financial institutions during a financial crisis in an attempt to save the failing bank.
The plea agreement entered into by Mr. Hall and the United States Attorney calls for a sentence of 65 months in federal prison based upon an agreement as to what would be the appropriate calculations for determining sentence length under the federal sentencing guidelines. The decision as to whether or not to accept this recommendation will be made by the court at the time of sentencing. The maximum possible sentence under the law is 30 years’ imprisonment, a maximum fine of $1,000,000, or both; a term of supervised release of up to five years; and a mandatory assessment fee of $100. Sentencing is currently set for September 30, 2013.
In his plea, Gary Patton Hall Jr., 47, admitted that from 2005 through 2010, he conspired with others to get money, credit, assets, securities and other bank property while replacing nonperforming bank loans with new loans in an effort to make the bank appear financially stronger than it was.
In April 2009, Tifton received $3.8 million in federal taxpayer funds from the U.S. Department of the Treasury Troubled Asset Relief Program, or TARP.
In November 2010, the bank was closed by state and federal banking regulators. As of Sept. 30, 2010, the bank had operated one banking center and had total assets of $143.7 million and total deposits of $141.6 million, according to a Federal Deposit Insurance Corp. statement.
One particular loan, guaranteed by the Small Business Administration, caused monetary losses of approximately $2.8 to the bank and the SBA. The $3.8 million in TARP funds also was lost when the bank failed.
The plea agreement calls for Hall to serve 65 months in federal prison, based upon federal sentencing guidelines. The decision to accept this recommendation will be made by the court at the time of sentencing, according to a press statement. Sentencing is currently set for Sept. 30, 2013.
The announcement of Hall's guilty plea was made by Christy Romero, special inspector general for the Troubled Asset Relief Program, and Michael J. Moore, U.S. Attorney for the Middle District of Georgia. Assistant U.S. Attorney Robert D. McCullers is prosecuting the case on behalf of the federal government.
The case was investigated by the Federal Deposit Insurance Corporation, the Special Inspector General for TARP (SIG-TARP), the Federal Bureau of Investigation, the U.S. Small Business Administration, and the Tift County Sheriff’s Office. Assistant United States Attorney Robert D. McCullers is handling the prosecution for the Government.
In entering his plea of guilty, Mr. Hall admitted that from 2005 continuing through 2010, he committed bank fraud involving the Tifton Banking Company during his employment as President and CEO of the bank. Mr. Hall admitted that he conspired with others to obtain money, funds, credits, assets, securities, and other property of the Tifton Banking Company while carrying on a practice of replacing non-performing loans with new loans, including a Small Business Administration (SBA) guaranteed loan, to make the bank appear financially stronger than it was. The actions caused monetary losses to the bank and SBA of approximately $2.8 million. Mr. Hall continued these illegal activities even during the time that the bank applied for and received assistance from the Troubled Asset Relief Program (TARP), a government program established to help financial institutions during a financial crisis in an attempt to save the failing bank.
The plea agreement entered into by Mr. Hall and the United States Attorney calls for a sentence of 65 months in federal prison based upon an agreement as to what would be the appropriate calculations for determining sentence length under the federal sentencing guidelines. The decision as to whether or not to accept this recommendation will be made by the court at the time of sentencing. The maximum possible sentence under the law is 30 years’ imprisonment, a maximum fine of $1,000,000, or both; a term of supervised release of up to five years; and a mandatory assessment fee of $100. Sentencing is currently set for September 30, 2013.
In his plea, Gary Patton Hall Jr., 47, admitted that from 2005 through 2010, he conspired with others to get money, credit, assets, securities and other bank property while replacing nonperforming bank loans with new loans in an effort to make the bank appear financially stronger than it was.
In April 2009, Tifton received $3.8 million in federal taxpayer funds from the U.S. Department of the Treasury Troubled Asset Relief Program, or TARP.
In November 2010, the bank was closed by state and federal banking regulators. As of Sept. 30, 2010, the bank had operated one banking center and had total assets of $143.7 million and total deposits of $141.6 million, according to a Federal Deposit Insurance Corp. statement.
One particular loan, guaranteed by the Small Business Administration, caused monetary losses of approximately $2.8 to the bank and the SBA. The $3.8 million in TARP funds also was lost when the bank failed.
The plea agreement calls for Hall to serve 65 months in federal prison, based upon federal sentencing guidelines. The decision to accept this recommendation will be made by the court at the time of sentencing, according to a press statement. Sentencing is currently set for Sept. 30, 2013.
The announcement of Hall's guilty plea was made by Christy Romero, special inspector general for the Troubled Asset Relief Program, and Michael J. Moore, U.S. Attorney for the Middle District of Georgia. Assistant U.S. Attorney Robert D. McCullers is prosecuting the case on behalf of the federal government.
The case was investigated by the Federal Deposit Insurance Corporation, the Special Inspector General for TARP (SIG-TARP), the Federal Bureau of Investigation, the U.S. Small Business Administration, and the Tift County Sheriff’s Office. Assistant United States Attorney Robert D. McCullers is handling the prosecution for the Government.
Hill Pleads Guilty to Embezzlement in Arkansas
Patricia A. Hill, of Beebe, a former officer of First Security Bank, Beebe branch, admitted in federal court in Little Rock Tuesday, June 11th, that she embezzled money over a period of 2 1/2 yrs. between the dates of Nov. 13, 2007 and April 19, 2010, according to an article in the Ark. Democrat-Gazette.
Hill pleaded guilty to a charge of theft by a bank officer - entering a plea to a “criminal information” a charging document before U.S. District Judge Kristine Baker. Hill manipulated accounts to increase the amounts customers owed on their consumer loans.
Sentencing will be at a later date.
Hill was contacted for comment but stated that the case was on-going and she could not comment at this time.
Hill pleaded guilty to a charge of theft by a bank officer - entering a plea to a “criminal information” a charging document before U.S. District Judge Kristine Baker. Hill manipulated accounts to increase the amounts customers owed on their consumer loans.
Sentencing will be at a later date.
Hill was contacted for comment but stated that the case was on-going and she could not comment at this time.
Wednesday, June 19, 2013
Former bank president indicted on 18 counts of fraud
A former Community Bank & Trust president was indicted on 18 counts of bank fraud in U.S. District Court on Tuesday.
David J. Langemak, 41, of Plymouth, faces a maximum of 30 years in prison and a $1 million fine on each count of fraud, according to the U.S. Attorney’s office in Milwaukee.
According to the indictment:
Langemak, while employed as president of the Plymouth branch of Community Bank & Trust, made unauthorized withdrawals totaling approximately $250,000 from the accounts of various bank customers for the benefit of a single, unrelated bank customer.
Community Bank & Trust Chairman and CEO, Tony Jovanovich, said Langemak ceased to be employed by the bank in 2011.
"No customers lost any money," Jovanovich said. He declined to elaborate.
Langemak became president of the Plymouth branch in 1998, according to his LinkedIn profile page.
The case was investigated by the Federal Deposit Insurance Corporation, Office of the Inspector General, the Federal Bureau of Investigation and the Small Business Administration, Office of the Inspector General. The case is being prosecuted by Assistant United States Attorney Carol L. Kraft.
Community Bank & Trust has 11 branches across eastern Wisconsin, including four in Sheboygan.
David J. Langemak, 41, of Plymouth, faces a maximum of 30 years in prison and a $1 million fine on each count of fraud, according to the U.S. Attorney’s office in Milwaukee.
According to the indictment:
Langemak, while employed as president of the Plymouth branch of Community Bank & Trust, made unauthorized withdrawals totaling approximately $250,000 from the accounts of various bank customers for the benefit of a single, unrelated bank customer.
Community Bank & Trust Chairman and CEO, Tony Jovanovich, said Langemak ceased to be employed by the bank in 2011.
"No customers lost any money," Jovanovich said. He declined to elaborate.
Langemak became president of the Plymouth branch in 1998, according to his LinkedIn profile page.
The case was investigated by the Federal Deposit Insurance Corporation, Office of the Inspector General, the Federal Bureau of Investigation and the Small Business Administration, Office of the Inspector General. The case is being prosecuted by Assistant United States Attorney Carol L. Kraft.
Community Bank & Trust has 11 branches across eastern Wisconsin, including four in Sheboygan.
Tuesday, June 18, 2013
Second Wells Fargo worker accused in Rock Hill bank embezzlement in North Carolina
A second Wells Fargo in Rock Hill employee has been accused of stealing money from the branch three weeks after a federal grand jury indicted her alleged co-conspirator in an embezzlement scheme, according to a federal indictment.
A federal grand jury on Tuesday indicted Tina Shaneka Hall, 33, of Rock Hill, charging her with theft by a bank employee and criminal conspiracy, according to a news release from the U.S. Attorney’s Office in Columbia.
Between last summer and December, Hall and Catawba’s Dionna Shawnte Lowery, 25, conspired to remove $100 and $50 bills from the bank and replace the bills with $1 bills, according to the indictment. They both worked at the remote banking drive-thru branch of Wells Fargo on Cherry Road.
Together, they’re accused of taking more than $1,000 belonging to the bank. If convicted, Hall could face a maximum 30 years in prison, the news release states.
Monday, June 17, 2013
Idaho woman sentenced, credit union embezzlement
A former teller at an Idaho Falls credit union has been sentenced to two months in prison, followed by two months of home detention for embezzlement.
The U.S. Attorney's Office says 40-year-old Virginia Mecham of Ammon was sentenced Monday by U.S. District Judge B. Lynn Winmill. Mecham also was sentenced to three years of supervised release and ordered to pay $23,625 in restitution.
Mecham pleaded guilty in February to embezzlement by a credit union employee.
The case came to light after customers of Westmark Credit Union contacted the credit union to ask about unauthorized withdrawals from their accounts. An investigation found Mecham handled all of the questionable transactions.
Friday, June 14, 2013
Once-trusted bank worker sent to prison in California
Mary Helen Perez, 50, of Sanger, has been sentenced by U.S. District Judge Lawrence O’Neill to two years and three months in prison for stealing and embezzling from a federally insured bank, says U.S. Attorney Benjamin Wagner.
Ms. Perez was also ordered to pay $249,793 in restitution to the bank.
According to court documents, Ms. Perez was the assistant customer service manager at Westamerica Bank in Sanger, where she had worked for 29 years.
Over a four-year period, she made approximately 78 cash withdrawals from seven customers’ bank accounts without their knowledge or authorization, targeting customers she believed trusted her, court records show.
She withdrew funds from their bank accounts by filling out withdrawal slips and forging their signatures or writing an “X” on the signature line. Ms. Perez spent the overwhelming majority of the embezzled funds at casinos and for other personal expenses.
The trusted, veteran, bank worker took several steps to hide her embezzlement from the bank and her victims, including telling some of the customers who questioned her about the unauthorized withdrawals that there would be fees charged for investigating the account discrepancies. Ms. Perez also sought to conceal her embezzlement by putting some of the victims’ bank statements on hold status so she would receive them at the bank, where she destroyed them.
Ms. Perez was also ordered to pay $249,793 in restitution to the bank.
According to court documents, Ms. Perez was the assistant customer service manager at Westamerica Bank in Sanger, where she had worked for 29 years.
Over a four-year period, she made approximately 78 cash withdrawals from seven customers’ bank accounts without their knowledge or authorization, targeting customers she believed trusted her, court records show.
She withdrew funds from their bank accounts by filling out withdrawal slips and forging their signatures or writing an “X” on the signature line. Ms. Perez spent the overwhelming majority of the embezzled funds at casinos and for other personal expenses.
The trusted, veteran, bank worker took several steps to hide her embezzlement from the bank and her victims, including telling some of the customers who questioned her about the unauthorized withdrawals that there would be fees charged for investigating the account discrepancies. Ms. Perez also sought to conceal her embezzlement by putting some of the victims’ bank statements on hold status so she would receive them at the bank, where she destroyed them.
Former Arkansas Credit Union President Pleads Guilty to Embezzlement
Karen York, the former president of the $8.9 million VA Hospital Federal Credit Union in Little Rock, Ark., pleaded guilty this week to embezzling more than $62,000 over 12 years.
In U.S. District Court in Little Rock, York admitted Monday that she engaged in a check kiting scheme and made false deposit entries to her account, according to federal prosecutors. She also admitted to falsifying records to hide the fact that funds were missing from the credit union.
York, 45, also said in court that she used VA Hospital FCU funds for an unauthorized pay increase and unreimbursed health insurance.
An audit from December 2000 to June 2012 uncovered a fraud loss of $62,513 because of York’s criminal actions. Federal prosecutors said York repaid a portion of the loss on the day she was suspended from her job. She has agreed to pay $43,940 in restitution.
A sentencing hearing for York has not been scheduled, authorities said.
Credit union employee charged with embezzlement in MIssissippi
A Forrest County grand jury has indicted a woman for allegedly embezzling more than $60,000 from the University of Southern Mississippi Federal Credit Union while she was employed there as a teller.
Helen A. Fitzgerald, 55, was served her indictment last week.
She was initially arrested on an embezzlement charge Dec. 12, by Hattiesburg Police Department officers.
The grand jury handed down the indictment May 14, alleging Fitzgerald “did willfully, unlawfully, and feloniously embezzle and fraudulently secrete, conceal and convert to her own use approximately $60,300.”
The document accuses her of racking up the alleged total in stolen funds between Oct. 31, 2011, and July 20, 2012.
Circuit Court records show that Fitzgerald bonded out of Forrest County Jail following her arrest.
Documentation of arraignment or waiver of arraignment are not in Fitzgerald’s file in the circuit clerk’s office, so a trial date has yet to be set.
It is unclear whether Fitzgerald currently has an attorney.
Helen A. Fitzgerald, 55, was served her indictment last week.
She was initially arrested on an embezzlement charge Dec. 12, by Hattiesburg Police Department officers.
The grand jury handed down the indictment May 14, alleging Fitzgerald “did willfully, unlawfully, and feloniously embezzle and fraudulently secrete, conceal and convert to her own use approximately $60,300.”
The document accuses her of racking up the alleged total in stolen funds between Oct. 31, 2011, and July 20, 2012.
Circuit Court records show that Fitzgerald bonded out of Forrest County Jail following her arrest.
Documentation of arraignment or waiver of arraignment are not in Fitzgerald’s file in the circuit clerk’s office, so a trial date has yet to be set.
It is unclear whether Fitzgerald currently has an attorney.
Monday, June 10, 2013
2 indicted for bank fraud
A federal grand jury has indicted two suspects in a three-count indictment centered around allegedly defrauding banks through forgery to the tune of more than $100,000.
Angela D. Bryant and Timothy Shane Bryant are both facing bank fraud and embezzlement of government funds charges. Angela D. Bryant also is charged with unauthorized use of another’s signature. All charges stem from alleged incidents in 2011.
The indictment’s notice of intent to seek criminal forfeiture asks for a monetary judgment “including, but not limited to” $113,713.09.
The document states Angela D. Bryant was a bookkeeper for an unnamed property management company that manages 11 apartment complexes as part of the U.S. Department of Agriculture Rural Development Housing and Community Facilities Program.
The program provides funding for low-income persons and the elderly.
“Low interest RRH (Rural Rental Housing) loans are made by the USDA-RD to individuals, non-profits, trust associations and state/local agencies, to provide housing under the USDA-RD,” the indictment states. “... In addition to the apartment complex and the land constituting the site of the RRH apartment complex, all income derived from the operation of the RRH is held as security by USDA-RD for the RRH loan.”
The loan agreement also requires the borrower must maintain bank accounts in accordance with USDA rules and that the USDA-RD controls and supervises the accounts, according to the indictment.
The indictment accuses Angela D. Bryant of “systematically” forging signatures on checks from the USDA accounts of the management business, making them payable to Timothy Bryant.
“To conceal the scheme to defraud, the defendant ... intercepted the bank statements for the bank accounts ... then altered these statements to conceal the theft from these accounts,” the indictment charges.
She also is charged with unlawfully using a means of identification of another person.
Another woman was sentenced last year in a similar scheme from the same business following a guilty plea last year.
Cynthia Cooley pleaded guilty Oct. 6 to one count of bank fraud and one count of aggravated identity theft.
U.S. District Judge Keith Starrett sentenced Cooley to five years of supervised release following her prison term and $507,710 in restitution, according to a press release.
Cooley only pleaded to two of five counts on which she was indicted, entering a plea agreement when she did so.
Her indictment, returned by a federal grand jury in June, also charges her with two additional counts of bank fraud and one count of theft of public money. The indictment said the illegal activity took place from 2008 to 2010.
She also used blank checks from USDA accounts, intercepted bank statements and altered them before the owner saw the paperwork
Angela D. Bryant and Timothy Shane Bryant are both facing bank fraud and embezzlement of government funds charges. Angela D. Bryant also is charged with unauthorized use of another’s signature. All charges stem from alleged incidents in 2011.
The indictment’s notice of intent to seek criminal forfeiture asks for a monetary judgment “including, but not limited to” $113,713.09.
The document states Angela D. Bryant was a bookkeeper for an unnamed property management company that manages 11 apartment complexes as part of the U.S. Department of Agriculture Rural Development Housing and Community Facilities Program.
The program provides funding for low-income persons and the elderly.
“Low interest RRH (Rural Rental Housing) loans are made by the USDA-RD to individuals, non-profits, trust associations and state/local agencies, to provide housing under the USDA-RD,” the indictment states. “... In addition to the apartment complex and the land constituting the site of the RRH apartment complex, all income derived from the operation of the RRH is held as security by USDA-RD for the RRH loan.”
The loan agreement also requires the borrower must maintain bank accounts in accordance with USDA rules and that the USDA-RD controls and supervises the accounts, according to the indictment.
The indictment accuses Angela D. Bryant of “systematically” forging signatures on checks from the USDA accounts of the management business, making them payable to Timothy Bryant.
“To conceal the scheme to defraud, the defendant ... intercepted the bank statements for the bank accounts ... then altered these statements to conceal the theft from these accounts,” the indictment charges.
She also is charged with unlawfully using a means of identification of another person.
Another woman was sentenced last year in a similar scheme from the same business following a guilty plea last year.
Cynthia Cooley pleaded guilty Oct. 6 to one count of bank fraud and one count of aggravated identity theft.
U.S. District Judge Keith Starrett sentenced Cooley to five years of supervised release following her prison term and $507,710 in restitution, according to a press release.
Cooley only pleaded to two of five counts on which she was indicted, entering a plea agreement when she did so.
Her indictment, returned by a federal grand jury in June, also charges her with two additional counts of bank fraud and one count of theft of public money. The indictment said the illegal activity took place from 2008 to 2010.
She also used blank checks from USDA accounts, intercepted bank statements and altered them before the owner saw the paperwork
Former bank employee accused of embezzlement in North Carolina
A local bank employee faces felony charges after she allegedly embezzled money from an elderly customer's banking account.
Leeann Allison, 30, of Maggie Valley, who until recently worked at SunTrust bank of Waynesville, is accused of forging a customer's signature and embezzling $5,000.
Ninety-year-old Walter Leonard said he is a longtime client of SunTrust bank.
"She had taken care of me several times when I came in to make withdrawals," Leonard said of Allison.
One day in April, Leonard noticed that $5,000 was drafted from his account as a withdrawal — a transaction he knew he didn't make.
Leonard told police he went to SunTrust on May 12 and spoke with Allison about the issue. In response, she told him that she "would take care of it."
Leeann Allison, 30, of Maggie Valley, who until recently worked at SunTrust bank of Waynesville, is accused of forging a customer's signature and embezzling $5,000.
Ninety-year-old Walter Leonard said he is a longtime client of SunTrust bank.
"She had taken care of me several times when I came in to make withdrawals," Leonard said of Allison.
One day in April, Leonard noticed that $5,000 was drafted from his account as a withdrawal — a transaction he knew he didn't make.
Leonard told police he went to SunTrust on May 12 and spoke with Allison about the issue. In response, she told him that she "would take care of it."
Friday, June 7, 2013
New search warrant gives more details in credit union fraud case in Virginia
Investigators have now searched a second residence in connection with the multi-million dollar Lynrocten Federal Credit Union investigation.
A search warrant filed in Roanoke federal court June 3 reveals a home on Churchview Drive in Madison Heights, owned by former Lynrocten teller Teresa Humphries, was searched by the Secret Service on May 28. Contacted by phone Thursday, a family member said Humphries had no comment on the investigation or warrant.
Lynrocten, a small credit union based in Lynchburg, was shut down by the National Credit Union Association in May after police began looking into possible criminal activity. The NCUA became aware of the suspected fraud by April 25 and the United States Secret Service was called in to assist May 7.
Teresa Humphries is one of two women once employed by the now-defunct credit union. Humphries was the bank’s teller and Linda Susan Newcomb, known as Sue, was the bank’s manager.
In late April and again in May, according to court documents, “Humphries admitted that she and Newcomb originated loans in member names without their authorization and thereafter deposited the funds from the various loans into other accounts maintained at Lynrocten FCU,” U.S. Secret Service agent Thomas Fleming wrote in an earlier affidavit.
The affidavit says Humphries “admitted she personally stole $3,000 to $4,000 a month and that she and Newcomb deposited the stolen funds into accounts belonging to their family members.”
On May 14, she recanted the statement.
The same day, documents show Humphries’ daughter, not identified by name, told investigators “her mother had given her approximately $3,000 to $4,000 a month for the past five years” but she did not know the source of the money.
Now investigators have searched the Humphries property and vehicles for evidence of any federal crimes.
Court documents show investigators were searching for evidence of “theft; embezzlement; or misapplication by bank officer or employee of lending credit and insurance institutions” … “false loan and credit applications” … and “aggravated identity theft.”
Among the items taken from the property were a cell phone, numerous documents, computers, credit union correspondence, tax documents, an LFC gift card and billing and retirement statements. Among the items seized was a statement for an account identified as the “Family Friend League Account.” Documents do not explain the significance of that account.
This recent warrant is the second made public in connection with the Lynrocten case. The first was issued in May on a Madison Heights home owned by Newcomb.
No arrests have been made in the case.
According to legal documents, Newcomb has maintained she has no knowledge of the alleged fraud scheme. Documents show over the course of three days in March, a total of $878,600 was deposited into an account of a cleaning business with an address “associated with the credit union manager Linda Susan Newcomb.”
“These high-dollar transactions do not appear to be consistent with a cleaning service,” Fleming wrote in the affidavit. “Similar transactions occurred in April,” and the irregularities could not be explained by the account holder.
Investigators said a preliminary review of property records reveal about 19 properties in the name of Newcomb’s spouse with a tax value of about $1,808,800.
A search of public records shows the deed to at least one piece of property has been shifted between family members three times from 2002 to 2005.
A search warrant filed in Roanoke federal court June 3 reveals a home on Churchview Drive in Madison Heights, owned by former Lynrocten teller Teresa Humphries, was searched by the Secret Service on May 28. Contacted by phone Thursday, a family member said Humphries had no comment on the investigation or warrant.
Lynrocten, a small credit union based in Lynchburg, was shut down by the National Credit Union Association in May after police began looking into possible criminal activity. The NCUA became aware of the suspected fraud by April 25 and the United States Secret Service was called in to assist May 7.
Teresa Humphries is one of two women once employed by the now-defunct credit union. Humphries was the bank’s teller and Linda Susan Newcomb, known as Sue, was the bank’s manager.
In late April and again in May, according to court documents, “Humphries admitted that she and Newcomb originated loans in member names without their authorization and thereafter deposited the funds from the various loans into other accounts maintained at Lynrocten FCU,” U.S. Secret Service agent Thomas Fleming wrote in an earlier affidavit.
The affidavit says Humphries “admitted she personally stole $3,000 to $4,000 a month and that she and Newcomb deposited the stolen funds into accounts belonging to their family members.”
On May 14, she recanted the statement.
The same day, documents show Humphries’ daughter, not identified by name, told investigators “her mother had given her approximately $3,000 to $4,000 a month for the past five years” but she did not know the source of the money.
Now investigators have searched the Humphries property and vehicles for evidence of any federal crimes.
Court documents show investigators were searching for evidence of “theft; embezzlement; or misapplication by bank officer or employee of lending credit and insurance institutions” … “false loan and credit applications” … and “aggravated identity theft.”
Among the items taken from the property were a cell phone, numerous documents, computers, credit union correspondence, tax documents, an LFC gift card and billing and retirement statements. Among the items seized was a statement for an account identified as the “Family Friend League Account.” Documents do not explain the significance of that account.
This recent warrant is the second made public in connection with the Lynrocten case. The first was issued in May on a Madison Heights home owned by Newcomb.
No arrests have been made in the case.
According to legal documents, Newcomb has maintained she has no knowledge of the alleged fraud scheme. Documents show over the course of three days in March, a total of $878,600 was deposited into an account of a cleaning business with an address “associated with the credit union manager Linda Susan Newcomb.”
“These high-dollar transactions do not appear to be consistent with a cleaning service,” Fleming wrote in the affidavit. “Similar transactions occurred in April,” and the irregularities could not be explained by the account holder.
Investigators said a preliminary review of property records reveal about 19 properties in the name of Newcomb’s spouse with a tax value of about $1,808,800.
A search of public records shows the deed to at least one piece of property has been shifted between family members three times from 2002 to 2005.
Ex-PlainsCapital teller gets 8 months in federal prison for embezzlement plea in Texas
Ex-teller gets 8 months for embezzlement plea
A former PlainsCapital Bank teller was sentenced on Thursday, June 6, to eight months in federal prison for stealing from her former employer.
U.S. District Judge Sam R. Cummings also ordered Riley Paige Trotter, 24, to pay $36,233 in restitution. After she finishes her prison term, she will spend five years on supervised release.
Trotter, a part-time teller supervisor at the bank, pleaded guilty in February to the charge. According to court documents, the theft was discovered in an internal audit when both her cash drawer and the vault came up short.
Trotter told bank officials she’d begun taking money from the bank in May 2010.
A former PlainsCapital Bank teller was sentenced on Thursday, June 6, to eight months in federal prison for stealing from her former employer.
U.S. District Judge Sam R. Cummings also ordered Riley Paige Trotter, 24, to pay $36,233 in restitution. After she finishes her prison term, she will spend five years on supervised release.
Trotter, a part-time teller supervisor at the bank, pleaded guilty in February to the charge. According to court documents, the theft was discovered in an internal audit when both her cash drawer and the vault came up short.
Trotter told bank officials she’d begun taking money from the bank in May 2010.
Stanley pleads guilty to theft/embezzlement in Iowa
Tiffany Ann (Crowell) Stanley pleaded guilty to one count of Theft by Bank Employee Thursday in U.S. District Court.
According to court records, Stanley appeared with her attorney, Joseph J. Hrvol, in front of District Court Judge Celeste F. Bremer and pleaded guilty. The court accepted her plea and sentencing was set for 11 a.m. on Oct. 11, 2013 in front of the Honorable Stephanie M. Rose. Stanley was then released.
An investigation following the reported robbery of the Great Western Bank in Riverton on Nov. 17 led to Stanley’s indictment on March 27.
In the indictment, Stanley was accused of "Theft of funds of the United States by a bank employee," a violation of U.S. Code, Title 18, section 656. The amount of theft listed in the indictment is $25,716.40.
On Nov. 17, Stanley contacted the Fremont County Sheriff Office and reported she had been robbed while opening up the Riverton Great Western Bank around 8:30 a.m.
At that time, Stanley informed deputies a large white male pushed her into the bank as she was unlocking to back door to open the facility. The man then demanded she put money in a bag, and fled the scene on foot with an undisclosed amount of cash.
Stanley described the robber as a "big guy," approximately 6-feet tall, with a goatee. She added the robber was wearing white sneakers, a black hooded sweatshirt, and blue jeans. Stanley received a small bruise, but was otherwise unharmed in the incident.
According to court records, Stanley appeared with her attorney, Joseph J. Hrvol, in front of District Court Judge Celeste F. Bremer and pleaded guilty. The court accepted her plea and sentencing was set for 11 a.m. on Oct. 11, 2013 in front of the Honorable Stephanie M. Rose. Stanley was then released.
An investigation following the reported robbery of the Great Western Bank in Riverton on Nov. 17 led to Stanley’s indictment on March 27.
In the indictment, Stanley was accused of "Theft of funds of the United States by a bank employee," a violation of U.S. Code, Title 18, section 656. The amount of theft listed in the indictment is $25,716.40.
On Nov. 17, Stanley contacted the Fremont County Sheriff Office and reported she had been robbed while opening up the Riverton Great Western Bank around 8:30 a.m.
At that time, Stanley informed deputies a large white male pushed her into the bank as she was unlocking to back door to open the facility. The man then demanded she put money in a bag, and fled the scene on foot with an undisclosed amount of cash.
Stanley described the robber as a "big guy," approximately 6-feet tall, with a goatee. She added the robber was wearing white sneakers, a black hooded sweatshirt, and blue jeans. Stanley received a small bruise, but was otherwise unharmed in the incident.
Saturday, June 1, 2013
Hyperion Bank Assistant Manager Charged with Embezzlement in Philadelphia
Tiffany Roberson, 29, of Philadelphia, Pennsylvania, was charged today by indictment with embezzlement of bank funds by a bank employee, announced United States Attorney Zane David Memeger. According to the indictment, Roberson, an assistant manager at Hyperion Bank, embezzled and misappropriated approximately $20,000 in money, funds, and assets intrusted to the custody and care of Hyperion Bank and its employees.
If convicted, Roberson faces a total maximum sentence of 30 years’ imprisonment, a $1,000,000 fine, five years’ supervised release, and a $100 special assessment.
The case was investigated by the Federal Bureau of Investigation in Philadelphia and is being prosecuted by Assistant United States Attorney Anita Eve.
If convicted, Roberson faces a total maximum sentence of 30 years’ imprisonment, a $1,000,000 fine, five years’ supervised release, and a $100 special assessment.
The case was investigated by the Federal Bureau of Investigation in Philadelphia and is being prosecuted by Assistant United States Attorney Anita Eve.
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