A teller for Chase Bank stole $10,000 from his branch "for love."
He was sentenced to a day in prison in federal court Wednesday. In April, 24-year-old Imran Cheema pleaded guilty to one count of embezzling.
Cheema told district judge Michael Watson that he took the money to impress his girlfriend. He stole the money from a teller cash dispenser just before quitting his teller job last summer and moving to New York.
Cheema was caught when the theft was discovered a week later. The cash dispenser, which tellers use to refill their drawers, was short $10,000. A Secret Service criminal complaint showed Cheema at the dispenser.
In addition to the night in prison, Watson ordered him to repay the money, which he has done. He could have been sentenced to 30 years in prison and ordered to pay a $1 million fine
Showing posts with label NEW YORK. Show all posts
Showing posts with label NEW YORK. Show all posts
Thursday, August 1, 2013
Monday, July 1, 2013
Bank Employee Pleads Guilty in Large Tax Refund Scheme in New York
U.S. Attorney William J. Hochul, Jr. announced today that Graciela Serra, 36, of Rochester, New York, pleaded guilty before U.S. District Court Judge David G. Larimer to conspiracy to commit tax fraud in connection with a large nationwide tax refund scheme. The charge carries a maximum penalty of 10 years in prison and a $250,000 fine.
Assistant U.S. Attorney Richard A. Resnick, who is handling the case, stated that from January 29, 2011 to October 31, 2011, Serra was involved in a scheme to obtain income tax refunds by the filing of fraudulent federal income tax returns with the Internal Revenue Service. Specifically, stolen identities were utilized to file the fraudulent federal income tax returns, and the wages and related tax withholdings reported on the federal income tax returns were fabricated in order to obtain the refunds. Most of the returns were filed in the names and Social Security numbers of individuals residing in Puerto Rico without their knowledge. The refund checks issued as a result of the fraudulent returns were sent to various addresses in Rochester and other locations in the country.
Serra, while a teller at the Woodforest Bank on Hudson Avenue in Rochester, used her position at the bank to cash several of the fraudulent tax refund checks for other participants in the scheme who brought the fraudulent checks to her at the bank. The defendant cashed the checks knowing they were in the names of individuals other than the individuals who brought the checks to the bank. The defendant was paid a fee for cashing the checks.
“Using one’s position of trust to facilitate a crime is something our office takes very seriously,” said U.S. Attorney Hochul. “In this case, the defendant abused her position as a bank teller to cash fraudulent checks issued by the Internal Revenue Service. Such fraud against the government in reality impacts all Americans.”
The plea is the culmination of a joint investigation on the part of the Federal Bureau of Investigation, under the direction of Acting Special Agent in Charge Richard M. Frankel, and the Internal Revenue Service, under the direction of Toni M. Weirauch, Special Agent in Charge.
Sentencing is scheduled for September 20, 2013 before Judge Larimer.
Assistant U.S. Attorney Richard A. Resnick, who is handling the case, stated that from January 29, 2011 to October 31, 2011, Serra was involved in a scheme to obtain income tax refunds by the filing of fraudulent federal income tax returns with the Internal Revenue Service. Specifically, stolen identities were utilized to file the fraudulent federal income tax returns, and the wages and related tax withholdings reported on the federal income tax returns were fabricated in order to obtain the refunds. Most of the returns were filed in the names and Social Security numbers of individuals residing in Puerto Rico without their knowledge. The refund checks issued as a result of the fraudulent returns were sent to various addresses in Rochester and other locations in the country.
Serra, while a teller at the Woodforest Bank on Hudson Avenue in Rochester, used her position at the bank to cash several of the fraudulent tax refund checks for other participants in the scheme who brought the fraudulent checks to her at the bank. The defendant cashed the checks knowing they were in the names of individuals other than the individuals who brought the checks to the bank. The defendant was paid a fee for cashing the checks.
“Using one’s position of trust to facilitate a crime is something our office takes very seriously,” said U.S. Attorney Hochul. “In this case, the defendant abused her position as a bank teller to cash fraudulent checks issued by the Internal Revenue Service. Such fraud against the government in reality impacts all Americans.”
The plea is the culmination of a joint investigation on the part of the Federal Bureau of Investigation, under the direction of Acting Special Agent in Charge Richard M. Frankel, and the Internal Revenue Service, under the direction of Toni M. Weirauch, Special Agent in Charge.
Sentencing is scheduled for September 20, 2013 before Judge Larimer.
Monday, May 6, 2013
Prosecutors seek prison for Owego, New York woman in bank embezzlement case
An Owego woman, one of three former employees at Chemung Canal Trust Co.’s Owego branch who admitted embezzling more than $325,000 over eight years, is the only defendant facing the prospect of time in federal prison.
Gwenn Gooding was portrayed in recent sentencing memorandums as someone who abused her position of trust and is unlikely to fully repay what was stolen, but also a working class mother with good character who made poor choices to support her family.
Gooding admitted stealing more than $195,000.
The U.S. Attorney’s Office has recommended she receive at least 2 years in prison when sentenced June 26.
“Bank employees, surrounded by cash all day long, should know that there will be a serious consequence to embezzling bank funds, particularly the amount stolen in this case,” Assistant U.S. Attorney Kevin Dooley wrote in court papers.
The embezzlement was uncovered as a result of an audit of the bank branch following severe flooding in September 2011.
Gooding, 43, former head teller; Megan Horton, 54, former branch manager; and Shannon Moore, 38, a former teller, admitted embezzling funds between December 2004 and September 2011. Horton admitted stealing more than $200,000, and Moore admitted to more than $25,000.
Gooding — described by her attorney Randi Bianco as active in community events like the Strawberry Festival and youth soccer and softball leagues — started stealing bank funds after bills began piling up and the family couldn’t make ends meet, Bianco wrote in sentencing papers.
“She used the money to pay bills and buy food for the family. At first, Mrs. Gooding paid the money back to the bank when she received her weekly paycheck, but things got worse,” Bianco wrote.
Bianco said Gooding couldn’t find work after her arrest, has no criminal record and should not receive prison time due to her willingness to pay restitution.
“It is significant that Mrs. Gooding never spent the bank’s money on luxury items, but used it only for living expenses,” she added.
Moore paid $27,000 in restitution before pleading guilty in January. On April 23, she was sentenced to 80 hours of community service and two years of supervised release.
Horton is to be sentenced on May 9. Prosecutors, noting her amount stolen was repaid after she resigned from the bank, have not recommended prison.
But that isn’t the case here, Dooley wrote in Gooding’s sentencing memorandum.
“It can be argued,” he said, “that this defendant’s background made what she did even more explicable and inexcusable.”
Gwenn Gooding was portrayed in recent sentencing memorandums as someone who abused her position of trust and is unlikely to fully repay what was stolen, but also a working class mother with good character who made poor choices to support her family.
Gooding admitted stealing more than $195,000.
The U.S. Attorney’s Office has recommended she receive at least 2 years in prison when sentenced June 26.
“Bank employees, surrounded by cash all day long, should know that there will be a serious consequence to embezzling bank funds, particularly the amount stolen in this case,” Assistant U.S. Attorney Kevin Dooley wrote in court papers.
The embezzlement was uncovered as a result of an audit of the bank branch following severe flooding in September 2011.
Gooding, 43, former head teller; Megan Horton, 54, former branch manager; and Shannon Moore, 38, a former teller, admitted embezzling funds between December 2004 and September 2011. Horton admitted stealing more than $200,000, and Moore admitted to more than $25,000.
Gooding — described by her attorney Randi Bianco as active in community events like the Strawberry Festival and youth soccer and softball leagues — started stealing bank funds after bills began piling up and the family couldn’t make ends meet, Bianco wrote in sentencing papers.
“She used the money to pay bills and buy food for the family. At first, Mrs. Gooding paid the money back to the bank when she received her weekly paycheck, but things got worse,” Bianco wrote.
Bianco said Gooding couldn’t find work after her arrest, has no criminal record and should not receive prison time due to her willingness to pay restitution.
“It is significant that Mrs. Gooding never spent the bank’s money on luxury items, but used it only for living expenses,” she added.
Moore paid $27,000 in restitution before pleading guilty in January. On April 23, she was sentenced to 80 hours of community service and two years of supervised release.
Horton is to be sentenced on May 9. Prosecutors, noting her amount stolen was repaid after she resigned from the bank, have not recommended prison.
But that isn’t the case here, Dooley wrote in Gooding’s sentencing memorandum.
“It can be argued,” he said, “that this defendant’s background made what she did even more explicable and inexcusable.”
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.
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.
Saturday, March 2, 2013
Bank Employee From Ridgefield Accused Of $739,000 Theft in New York
A Larchmont bank employee accused of transferring $739,000 from customer accounts to his own was arraigned Friday, Westchester District Attorney Janet DiFiore announced.
Jeremy Winter, of Ridgefield, Conn., was charged with three counts of second-degree grand larceny, second-degree forgery, first-degree falsifying business records and first-degree scheme to defraud, all felonies. He worked at TD Bank, 107 Chatsworth Ave.
The defendant allegedly used the money to pay off personal loans and contractors he hired to do home improvements, DiFiore said. He continued to take money from customers to replenish previous victims' accounts, which the District Attorney's press release called "robbing Peter to pay Paul."
Winter also is accused of forging a customer’s signature on a withdrawal slip for $110,000, creating a false business record. The bank reported Winter to the Larchmont police in September. He was arrested Thursday, Feb. 28, and arraigned in Larchmont Village Court. Bail was set at $100,000.
Winter is due in Westchester County Court May 14. He faces a maximum sentence of 15 years in prison on each of the counts.
Assistant District Attorney Robert Mayes of the Economic Crimes Bureau is prosecuting the case
Monday, September 19, 2011
Lowville woman charged in $10,000 embezzlement in New York
Lowville woman accused of embezzling $10,000
State police allege that a bank teller embezzled $10,000 on a single day.
Elsa L. Bush, 33, of 7564 Church St., Lowville, was arrested Thursday on a charge of third-degree grand larceny. She was arraigned in town of Pamelia Court and was released without bail to await grand jury action.
An investigator alleges that Ms. Bush stole the money July 26 while working as a teller at Community Bank, Route 3, Black River. No other details were available Thursday.
State police allege that a bank teller embezzled $10,000 on a single day.
Elsa L. Bush, 33, of 7564 Church St., Lowville, was arrested Thursday on a charge of third-degree grand larceny. She was arraigned in town of Pamelia Court and was released without bail to await grand jury action.
An investigator alleges that Ms. Bush stole the money July 26 while working as a teller at Community Bank, Route 3, Black River. No other details were available Thursday.
Former Citigroup Insider Pleads Guilty To Bank Fraud
Gary Foster, a former vice president in Citigroup Inc.'s treasury finance department, on Tuesday pleaded guilty to bank fraud related to his embezzlement of more than $22 million from Citigroup and its customers.
According to the U.S. Attorney's Office for the Eastern District of New York, the Federal Bureau of Investigation's charges against Foster stemmed from fraud he committed against Citi between September 2003 and June 2011.
On June 26, Foster, was arrested by the Federal Bureau of Investigation at John F. Kennedy International Airport, just as he returned from a trip to Bangkok.
"The defendant violated his employer's trust and stole a stunning amount of money over an extended period of time to finance his personal lifestyle," says Loretta E. Lynch, U.S. Attorney for Eastern New York in a statement. "We will vigorously investigate and prosecute such conduct and seek to recover as much of the proceeds as possible."
Shannon Bell, a spokeswoman for Citi, says simply, "We are pleased that Mr. Foster will be held accountable for his crimes."
The Foster case highlights exactly why many institutions face challenges when it comes to detecting internal fraud. "A bank the size of Citi will have significant technological resources deployed against detecting online fraud, but the patterns of internal fraud can often mimic the patterns of everyday activity. This underscores the need for a layered approach to detecting internal fraud, combining internal audit, behavior analytics and periodic background checks. While living a lavish lifestyle isn't a crime, this individual's lifestyle wasn't commensurate with his position, and could've been an early red flag, if anyone had been looking."
Foster was charged with transferring money from various Citi accounts to a Citi cash account. From there, he wired the money to a personal bank account at another bank. He concealed the thefts by making various false accounting entries, making it appear as if the cash account was in balance. He also placed a fake contract or deal number in the reference line of the wire transfer instructions, giving the appearance that the wire transfers were actually in support of an existing Citi contract.
Foster used the money to buy real estate and luxury automobiles, including a Ferrari and a Maserati. In total, the value of the seized and restrained property is estimated to be approximately $16 million. Foster will forfeit the property pursuant to his plea agreement, and now faces a maximum sentence of 30 years' imprisonment.
"Like most employee fraud, using basic monitoring software could have identified the transaction anomalies well before the fraud reached this magnitude. Foster was wiring funds to a personal bank account at another bank, a situation that could have been easily identified if it was being monitored. This particular fraud went on for almost eight years before it was finally identified. How much of this type of fraud is currently happening under the noses of other financial institutions? The answer is, a lot, several billion dollars worth."
According to the U.S. Attorney's Office for the Eastern District of New York, the Federal Bureau of Investigation's charges against Foster stemmed from fraud he committed against Citi between September 2003 and June 2011.
On June 26, Foster, was arrested by the Federal Bureau of Investigation at John F. Kennedy International Airport, just as he returned from a trip to Bangkok.
"The defendant violated his employer's trust and stole a stunning amount of money over an extended period of time to finance his personal lifestyle," says Loretta E. Lynch, U.S. Attorney for Eastern New York in a statement. "We will vigorously investigate and prosecute such conduct and seek to recover as much of the proceeds as possible."
Shannon Bell, a spokeswoman for Citi, says simply, "We are pleased that Mr. Foster will be held accountable for his crimes."
The Foster case highlights exactly why many institutions face challenges when it comes to detecting internal fraud. "A bank the size of Citi will have significant technological resources deployed against detecting online fraud, but the patterns of internal fraud can often mimic the patterns of everyday activity. This underscores the need for a layered approach to detecting internal fraud, combining internal audit, behavior analytics and periodic background checks. While living a lavish lifestyle isn't a crime, this individual's lifestyle wasn't commensurate with his position, and could've been an early red flag, if anyone had been looking."
Foster was charged with transferring money from various Citi accounts to a Citi cash account. From there, he wired the money to a personal bank account at another bank. He concealed the thefts by making various false accounting entries, making it appear as if the cash account was in balance. He also placed a fake contract or deal number in the reference line of the wire transfer instructions, giving the appearance that the wire transfers were actually in support of an existing Citi contract.
Foster used the money to buy real estate and luxury automobiles, including a Ferrari and a Maserati. In total, the value of the seized and restrained property is estimated to be approximately $16 million. Foster will forfeit the property pursuant to his plea agreement, and now faces a maximum sentence of 30 years' imprisonment.
"Like most employee fraud, using basic monitoring software could have identified the transaction anomalies well before the fraud reached this magnitude. Foster was wiring funds to a personal bank account at another bank, a situation that could have been easily identified if it was being monitored. This particular fraud went on for almost eight years before it was finally identified. How much of this type of fraud is currently happening under the noses of other financial institutions? The answer is, a lot, several billion dollars worth."
Wednesday, January 19, 2011
NY pastor charged with embezzling $400K from bank; police say church funds not involved
Police say a pastor at an upstate New York church embezzled more than $400,000 from the credit union where he worked.
Jason LaPierre, pastor at River Church in Kingsbury is charged with writing himself hundreds of personal checks over four years while working at the Hudson River Community Credit Union in Corinth, 40 miles north of Albany.
LaPierre was a human resources and marketing executive at the bank. The thefts were discovered last year and he was fired in December.
Police believe at least $406,000 was taken.
LaPierre was arraigned Wednesday on charges of grand larceny and falsifying business records. Phones for LaPierre and the church were out of service Thursday.
A bank officer says the funds were insured against theft.
Jason LaPierre, pastor at River Church in Kingsbury is charged with writing himself hundreds of personal checks over four years while working at the Hudson River Community Credit Union in Corinth, 40 miles north of Albany.
LaPierre was a human resources and marketing executive at the bank. The thefts were discovered last year and he was fired in December.
Police believe at least $406,000 was taken.
LaPierre was arraigned Wednesday on charges of grand larceny and falsifying business records. Phones for LaPierre and the church were out of service Thursday.
A bank officer says the funds were insured against theft.
Wednesday, November 24, 2010
Former Binghamton-area banker sentenced for embezzling client's money in New York
BINGHAMTON -- A former local bank manager will spend four years in federal prison for embezzling $410,000 in cash from a Dickinson man's safety deposit box, a judge said Tuesday.
Thomas Cararo, 40, now of North Carolina, can spend the holidays with his family, wife and children, but he'll have to surrender Jan. 4 to officers with the U.S. Marshals Service to begin serving his sentence, said Senior U.S. District Court Judge Thomas J. McAvoy during Cararo's sentencing in Binghamton's federal court.
McAvoy told Cararo that while taking the money was "despicable," Cararo also had a clean record until the embezzlement.
"You can be pushed into a position where you don't use your judgment," McAvoy said.
The judge gave Cararo less prison time than federal sentencing guidelines recommend as the minimum, which is four years, 11 months.
The former Citizens Bank branch manager could have received up to 30 years for his June 11 jury conviction on a single count of embezzlement.
"This whole experience has humbled me in so many ways, more ways than I can even tell you," Cararo told McAvoy. "I loved what I did. I loved my job working in a bank."
Cararo will also have to pay back the $410,000 -- $256,000 to Leonard Wilcox and $154,000 to Cararo's former employer, Citizens Bank.
The bank reimbursed Wilcox with $154,000, the amount of cash that bank records indicated was exchanged as damaged or destroyed.
Wilcox testified at Cararo's trial that he kept about $484,000 in cash in a floor safe in the garage to his house in the Town of Dickinson. But in 2006 flooding, the cash was soaked and contaminated by sewage.
Wilcox testified he exchanged the damaged cash for new money at the Chenango Bridge branch of Citizens Bank, where Cararo was then the branch manager.
Bank records showed about $154,000 in damaged or contaminated money was exchanged. However, tellers at the bank testified at trial that they exchanged thousands in cash with Wilcox that wasn't recorded as damaged.
Wilcox testified he took hundreds of thousands of dollars in a shopping bag in October 2006 to the 84 Court St. location of Citizens Bank, where Cararo was transferred as bank manager,
Wilcox put the cash in a safe deposit box, he testified. When he returned on Nov. 7, 2007, to check on his money, the box had been redrilled and rekeyed. When box No. 418 was opened, all that remained of the $410,000 was $74,000, Wilcox testified.
Cararo left Citizens in August 2007 for a job with Bank of America in North Carolina. Box No. 418 was drilled and rekeyed in June 2007 at the direction of Cararo, witnesses testified in June.
An FBI investigation of Cararo's bank records showed Cararo used cash payments of up to $65,000 to pay for home improvements and renovations, as well as furniture, at two houses he owned in the Town of Dickinson -- one street over from Wilcox's residence.
However, the FBI investigation could not account for the amount of cash Cararo was alleged to have taken.
Assistant U.S. Attorney Thomas Walsh, who prosecuted the case, on Tuesday called McAvoy's sentencing of Cararo fair.
Cararo's attorney, federal Public Defender Lisa Peebles, didn't agree with that assessment.
"I think it's really sad," Peebles said. "I don't believe for a second (Wilcox) lost more than $400,000."
Thomas Cararo, 40, now of North Carolina, can spend the holidays with his family, wife and children, but he'll have to surrender Jan. 4 to officers with the U.S. Marshals Service to begin serving his sentence, said Senior U.S. District Court Judge Thomas J. McAvoy during Cararo's sentencing in Binghamton's federal court.
McAvoy told Cararo that while taking the money was "despicable," Cararo also had a clean record until the embezzlement.
"You can be pushed into a position where you don't use your judgment," McAvoy said.
The judge gave Cararo less prison time than federal sentencing guidelines recommend as the minimum, which is four years, 11 months.
The former Citizens Bank branch manager could have received up to 30 years for his June 11 jury conviction on a single count of embezzlement.
"This whole experience has humbled me in so many ways, more ways than I can even tell you," Cararo told McAvoy. "I loved what I did. I loved my job working in a bank."
Cararo will also have to pay back the $410,000 -- $256,000 to Leonard Wilcox and $154,000 to Cararo's former employer, Citizens Bank.
The bank reimbursed Wilcox with $154,000, the amount of cash that bank records indicated was exchanged as damaged or destroyed.
Wilcox testified at Cararo's trial that he kept about $484,000 in cash in a floor safe in the garage to his house in the Town of Dickinson. But in 2006 flooding, the cash was soaked and contaminated by sewage.
Wilcox testified he exchanged the damaged cash for new money at the Chenango Bridge branch of Citizens Bank, where Cararo was then the branch manager.
Bank records showed about $154,000 in damaged or contaminated money was exchanged. However, tellers at the bank testified at trial that they exchanged thousands in cash with Wilcox that wasn't recorded as damaged.
Wilcox testified he took hundreds of thousands of dollars in a shopping bag in October 2006 to the 84 Court St. location of Citizens Bank, where Cararo was transferred as bank manager,
Wilcox put the cash in a safe deposit box, he testified. When he returned on Nov. 7, 2007, to check on his money, the box had been redrilled and rekeyed. When box No. 418 was opened, all that remained of the $410,000 was $74,000, Wilcox testified.
Cararo left Citizens in August 2007 for a job with Bank of America in North Carolina. Box No. 418 was drilled and rekeyed in June 2007 at the direction of Cararo, witnesses testified in June.
An FBI investigation of Cararo's bank records showed Cararo used cash payments of up to $65,000 to pay for home improvements and renovations, as well as furniture, at two houses he owned in the Town of Dickinson -- one street over from Wilcox's residence.
However, the FBI investigation could not account for the amount of cash Cararo was alleged to have taken.
Assistant U.S. Attorney Thomas Walsh, who prosecuted the case, on Tuesday called McAvoy's sentencing of Cararo fair.
Cararo's attorney, federal Public Defender Lisa Peebles, didn't agree with that assessment.
"I think it's really sad," Peebles said. "I don't believe for a second (Wilcox) lost more than $400,000."
Friday, October 8, 2010
Ex-Park Avenue Bank Chief Antonucci Pleads Guilty to Embezzling TARP Money
Charles Antonucci, the former president of Park Avenue Bank in Manhattan, pleaded guilty to charges he lied to regulators and embezzled bank funds. Antonucci, 59, told U.S. District Judge Naomi Buchwald today that he lied to get more than $11 million in federal bailout funds for the bank, took bribes and embezzled money and participated in a scheme to defraud Oklahoma insurance regulators in the $37.5 million sale of an insurer that was later forced into receivership. Prosecutors said Antonucci is the first person convicted of trying to defraud the U.S. Troubled Asset Relief Program, which was passed by Congress to prop up threatened banks. Antonucci pleaded guilty to criminal counts including fraud, bribery, embezzlement and conspiracy. Antonucci, who was arrested in March, is free on $2 million bail. He faces as much as 20 years in prison on the most serious counts when he’s sentenced in April.
Sunday, August 29, 2010
Lowville, New York files suit against its bank
As expected, the town of Lewis has filed a lawsuit against its bank claiming it was culpable in the embezzlement of more than $250,000 by the town's ex-bookkeeper."The loss of monies incurred by Plaintiff was due to the negligence and bad faith on the part of the Defendant, Community Bank," according to a state Supreme Court lawsuit filed Thursday in the Lewis County clerk's office.Utica attorney C. Louis Abelove, who is representing the town in the case, on Wednesday also filed a lawsuit seeking repayment of $250,348.28, plus interest and legal fees, from Melissa L. Wagner-Dano and her husband, Douglas J. Dano.
The town is seeking reimbursement of the stolen money, plus interest and legal fees incurred, according to both lawsuits.And, according to Mr. Abelove, town officials aren't too particular about who would pay them back."We think the town should get its money back," he said. "If any of the parties want to step up to the plate and pay the town, the town will be happy to receive it."Ms. Wagner-Dano, 34, in April pleaded guilty in U.S. District Court, Syracuse, to wire fraud, admitting that she embezzled $400,000 to $1 million from January 2007 through November 2009 from the town, the Oneida-Lewis Dairy Cooperative and the Boonville Farm Cooperative.She could receive up to 20 years in federal prison and a maximum fine of $250,000 at her sentencing Sept. 21. Restitution also is expected to be ordered by the federal court, although civil judgments could offer a better chance of recouping the money.The town has seven accounts at the Community Bank branch in Boonville, including savings, checking and capital-project funds for both general and highway, as well as a trust and agency fund for payroll, the lawsuit states."Community Bank N.A. has fully cooperated with the authorities, and we are referring all inquiries to law enforcement," Hal Wentworth, a spokesman for the DeWitt-based bank, wrote in an e-mail to the Times.Ms. Wagner-Dano, between November 2008 and December 2009, transferred funds between accounts of the town and the two cooperatives, for which she also served as bookkeeper, "for the ultimate purpose of committing these funds to her own use," the suit states.However, the town alleges that most of its funds were drained after April 2009, when Ms. Wagner-Dano established an Intuit QuickBooks software payroll program for the town. She then signed up for online banking through Community Bank, falsely listed the two cooperatives as town employees, made online money transfers from other town accounts to the payroll account, "paid" the cooperatives and withdrew the money from their accounts, the suit states.The town claims that in order to avoid detection, she directed the bank to stop sending paper statements to the town and instead "send e-statements to her Internet account to keep the Town Supervisor from reviewing them."Given its long history with the town, the bank should have known that the extensive transactions were unusual and that the cooperatives were not town employees or regular business partners, the lawsuit states.The town claims bank officials also should have known that it hadn't authorized online bank transfers or ever before used them and that the supervisor and deputy supervisor are the only ones authorized to sign checks from its bank accounts.
As town bookkeeper, Ms. Wagner-Dano prepared payroll checks for the signature of the supervisor and created balance sheets and financial reports but was not authorized to sign checks or approve expenditures, the lawsuit states.
The town is seeking reimbursement of the stolen money, plus interest and legal fees incurred, according to both lawsuits.And, according to Mr. Abelove, town officials aren't too particular about who would pay them back."We think the town should get its money back," he said. "If any of the parties want to step up to the plate and pay the town, the town will be happy to receive it."Ms. Wagner-Dano, 34, in April pleaded guilty in U.S. District Court, Syracuse, to wire fraud, admitting that she embezzled $400,000 to $1 million from January 2007 through November 2009 from the town, the Oneida-Lewis Dairy Cooperative and the Boonville Farm Cooperative.She could receive up to 20 years in federal prison and a maximum fine of $250,000 at her sentencing Sept. 21. Restitution also is expected to be ordered by the federal court, although civil judgments could offer a better chance of recouping the money.The town has seven accounts at the Community Bank branch in Boonville, including savings, checking and capital-project funds for both general and highway, as well as a trust and agency fund for payroll, the lawsuit states."Community Bank N.A. has fully cooperated with the authorities, and we are referring all inquiries to law enforcement," Hal Wentworth, a spokesman for the DeWitt-based bank, wrote in an e-mail to the Times.Ms. Wagner-Dano, between November 2008 and December 2009, transferred funds between accounts of the town and the two cooperatives, for which she also served as bookkeeper, "for the ultimate purpose of committing these funds to her own use," the suit states.However, the town alleges that most of its funds were drained after April 2009, when Ms. Wagner-Dano established an Intuit QuickBooks software payroll program for the town. She then signed up for online banking through Community Bank, falsely listed the two cooperatives as town employees, made online money transfers from other town accounts to the payroll account, "paid" the cooperatives and withdrew the money from their accounts, the suit states.The town claims that in order to avoid detection, she directed the bank to stop sending paper statements to the town and instead "send e-statements to her Internet account to keep the Town Supervisor from reviewing them."Given its long history with the town, the bank should have known that the extensive transactions were unusual and that the cooperatives were not town employees or regular business partners, the lawsuit states.The town claims bank officials also should have known that it hadn't authorized online bank transfers or ever before used them and that the supervisor and deputy supervisor are the only ones authorized to sign checks from its bank accounts.
As town bookkeeper, Ms. Wagner-Dano prepared payroll checks for the signature of the supervisor and created balance sheets and financial reports but was not authorized to sign checks or approve expenditures, the lawsuit states.
Saturday, July 24, 2010
New York ex-bank computer tech gets prison in $1M scam
A computer technician who used a three-month job at a New York bank as a launching pad for almost a decade of theft from charities has been sentenced to five to 15 years in prison.Adeniyi Adeyemi (ah-DEN'-ee ah-deh-YEM'-ee) told a judge Wednesday he felt "shame, guilt and remorse" for his scheme.He admitted last month to stealing 2,000 bank employees' identities in 2001. He used their IDs for years to siphon about $1 million from charities that released banking information to ease donations.He transferred money from the charities' accounts to accounts he'd opened under stolen identities.Adeyemi pleaded guilty to charges including grand larceny. The 27-year-old Nigerian immigrant will be deported after serving his sentence. The range reflects possible credit for good behavior.
Saturday, July 10, 2010
New York Mellon Bank IT Worker Charged In $1Million Fraud
A previous IT staffer with Bank of New York Mellon pleaded guilty to theft responsive information belonging to 2,000 bank staff and then using that data to take further than $1 million from charities.
Adeniyi Adeyemi, 27, had worked as an agreement computer technician at Bank's Manhattan headquarters, and data he supposedly stole belonged above all to colleague in the bank's IT department.He pleaded guilty to stealing, currency wash and PC tampering charges in New York City Criminal Court, the New York District Attorney's Office said in a report.More than an eight-year stage, Adeyemi stole a lot than $1.1 million from charities by shift funds from charities' bank accounts into false accounts he'd system using private information of his previous co-workers, prosecutors say. He "input the charities' banking particulars, as well as account and routing numbers, to set up wire transfers on E*Trade and loyalty sites from the charities' account to his fake accounts, and remove the stolen funds or transferred them to a second layer of fake accounts," the quarter attorney's office said in its press release.
Adeniyi Adeyemi, 27, had worked as an agreement computer technician at Bank's Manhattan headquarters, and data he supposedly stole belonged above all to colleague in the bank's IT department.He pleaded guilty to stealing, currency wash and PC tampering charges in New York City Criminal Court, the New York District Attorney's Office said in a report.More than an eight-year stage, Adeyemi stole a lot than $1.1 million from charities by shift funds from charities' bank accounts into false accounts he'd system using private information of his previous co-workers, prosecutors say. He "input the charities' banking particulars, as well as account and routing numbers, to set up wire transfers on E*Trade and loyalty sites from the charities' account to his fake accounts, and remove the stolen funds or transferred them to a second layer of fake accounts," the quarter attorney's office said in its press release.
Saturday, June 12, 2010
Former Citizens Bank manager in New York found guilty of embezzling $410,000
A former bank manager embezzled $410,000 in cash from a safe deposit box, a federal jury said Friday night.Thomas Cararo, 40, former manager of Citizens Bank in downtown Binghamton, showed little emotion at the verdict, announced at 6 p.m., just four hours after jury deliberations began in U.S. District Court in Binghamton.
There also was little reaction from Leonard Wilcox, the 79-year-old Dickinson heavy equipment dealer who accused Cararo of taking his cash.
Senior U.S. District Court Judge Thomas J. McAvoy set sentencing for Oct. 8.
Cararo will remain free pending sentencing, the judge said. He could get up to 30 years on one federal count of embezzlement but is more likely to get up to four years under federal sentencing guidelines.
"I'm just really happy for Mr. Wilcox and his family," said Assistant U.S. Attorney Thomas Walsh. "It's really been a long road for him."
Whether Wilcox will ever recover any of the $410,000 in missing cash is still unanswered.
A federal civil jury last year awarded $410,000 in damages to Wilcox and blamed Cararo for the loss.
Pursuit of the money continues to be handled in federal civil court, Walsh said.
The jury in the criminal case heard testimony for four days. Midway through deliberations Friday, they asked the judge for a calculator, and with the approval of both defense and prosecution, the judge got them a calculator. It was the only request made by the jury.
Cararo's attorney, Lisa Peebles, a federal public defender from Syracuse, said after the verdict was announced that she was disappointed by Friday's outcome.
"The testimony indicated that Mr. Wilcox was not an honest man," Peebles said. "The case rested on his word and the word of his daughter."
Wilcox testified this week that he kept about $484,000 in cash in a floor safe in his garage. But in 2006 flooding, the cash was soaked and contaminated by sewage. Wilcox testified he took the money to exchange it for new money at the Chenango Bridge branch of Citizens Bank, where Cararo was then the branch manager.
Bank records show about $150,000 in damaged or contaminated money was exchanged. However, tellers at the bank testified this week that they exchanged thousands in cash with Wilcox that wasn't recorded as damaged.
Wilcox testified he took hundreds of thousand of dollars in a shopping bag in October 2006 to the 84 Court St. location of Citizens Bank, where Cararo was transferred as bank manager.
Wilcox put the cash in a safe deposit box, he testified. When he returned on Nov. 7, 2007, to check on his money, the box had been re-drilled and re-keyed. When box No. 418 was opened, all that remained of the $410,000 was $74,000, Wilcox testified.
Banks do not insure the contents of safe deposit boxes, bank officials testified during the trial. Nor do banks want to know what customers keep in the boxes. Using the boxes for cash is not encouraged, officials testified.
Cararo left Citizens in August 2007 for a job with Bank of America in North Carolina. Box No. 418 was drilled and re-keyed in June 2007 at the direction of Cararo, testimony indicated.
An FBI investigation of Cararo's bank records showed Cararo used cash payments of up to $65,000 to pay for home improvements and renovations, as well as furniture, at two houses he owned in the Town of Dickinson. However, the FBI investigation could not account for the amount of cash Cararo was alleged to have taken, Peebles told jurors.
There also was little reaction from Leonard Wilcox, the 79-year-old Dickinson heavy equipment dealer who accused Cararo of taking his cash.
Senior U.S. District Court Judge Thomas J. McAvoy set sentencing for Oct. 8.
Cararo will remain free pending sentencing, the judge said. He could get up to 30 years on one federal count of embezzlement but is more likely to get up to four years under federal sentencing guidelines.
"I'm just really happy for Mr. Wilcox and his family," said Assistant U.S. Attorney Thomas Walsh. "It's really been a long road for him."
Whether Wilcox will ever recover any of the $410,000 in missing cash is still unanswered.
A federal civil jury last year awarded $410,000 in damages to Wilcox and blamed Cararo for the loss.
Pursuit of the money continues to be handled in federal civil court, Walsh said.
The jury in the criminal case heard testimony for four days. Midway through deliberations Friday, they asked the judge for a calculator, and with the approval of both defense and prosecution, the judge got them a calculator. It was the only request made by the jury.
Cararo's attorney, Lisa Peebles, a federal public defender from Syracuse, said after the verdict was announced that she was disappointed by Friday's outcome.
"The testimony indicated that Mr. Wilcox was not an honest man," Peebles said. "The case rested on his word and the word of his daughter."
Wilcox testified this week that he kept about $484,000 in cash in a floor safe in his garage. But in 2006 flooding, the cash was soaked and contaminated by sewage. Wilcox testified he took the money to exchange it for new money at the Chenango Bridge branch of Citizens Bank, where Cararo was then the branch manager.
Bank records show about $150,000 in damaged or contaminated money was exchanged. However, tellers at the bank testified this week that they exchanged thousands in cash with Wilcox that wasn't recorded as damaged.
Wilcox testified he took hundreds of thousand of dollars in a shopping bag in October 2006 to the 84 Court St. location of Citizens Bank, where Cararo was transferred as bank manager.
Wilcox put the cash in a safe deposit box, he testified. When he returned on Nov. 7, 2007, to check on his money, the box had been re-drilled and re-keyed. When box No. 418 was opened, all that remained of the $410,000 was $74,000, Wilcox testified.
Banks do not insure the contents of safe deposit boxes, bank officials testified during the trial. Nor do banks want to know what customers keep in the boxes. Using the boxes for cash is not encouraged, officials testified.
Cararo left Citizens in August 2007 for a job with Bank of America in North Carolina. Box No. 418 was drilled and re-keyed in June 2007 at the direction of Cararo, testimony indicated.
An FBI investigation of Cararo's bank records showed Cararo used cash payments of up to $65,000 to pay for home improvements and renovations, as well as furniture, at two houses he owned in the Town of Dickinson. However, the FBI investigation could not account for the amount of cash Cararo was alleged to have taken, Peebles told jurors.
Tuesday, March 23, 2010
Former Controller of Manhattan Investment Firm Pleads Guilty in Manhattan Federal Court to Embezzling Over $734,000
PREET BHARARA, the United States Attorney for the Southern District of New York, announced that RICHARD TEDESCHI, the former Controller of a Manhattan-based investment firm, pleaded guilty today to mail fraud and aggravated identity theft for stealing more than $734,000 from the firm. TEDESCHI entered his guilty plea before United States District Judge LEWIS A. KAPLAN in Manhattan federal court.
According to the criminal Information to which TEDESCHI pleaded guilty, documents previously filed in this case, and statements made in court: While employed at the investment firm, TEDESCHI engaged in a seven-year scheme to defraud the firm. Among other things, TEDESCHI forged the signatures of officers who had check-signing authority on company checks and used the company checks to make payments on his personal expenses or to himself directly. TEDESCHI also obtained authorized representatives' signatures on the firm's checks to make payments on what TEDESCHI represented to be company expenses, but which were actually for his personal expenses. Additionally, TEDESCHI caused unauthorized charges to be made on the investment firm's American Express account.
In all, TEDESCHI stole over $734,000 from the firm, over $633,000 of which was used to pay his personal American Express bills. TEDESCHI directed $7,500 to the payment of the mortgage on his home; $2,500 to the payment of telephone bills; and $12,000 to personal expenses charged on the firm's American Express account. He also caused the firm to pay him directly approximately $79,000.
TEDESCHI, 51, of Morris Plains, New Jersey, pleaded guilty to one count of mail fraud and one count of aggravated identity theft. TEDESCHI faces a maximum sentence of 20 years in prison on the mail fraud count, and a maximum fine of the greater of $250,000 or twice the gross pecuniary gain or loss from the offense. On the aggravated identity theft charge, TEDESCHI faces an additional two-year sentence that would be served consecutively with a sentence on the mail fraud charge. Sentencing is scheduled for June 21, 2010, at 11:00 a.m. before Judge KAPLAN.
U.S. Attorney BHARARA stated: "Richard Tedeschi abused his authority over his firm's finances, turning a position of oversight into something underhanded. After years of using forgery and fraud to siphon $730,000 for his own benefit, Tedeschi's gravy train is at an end. We will continue to partner with the Federal Bureau of Investigation to pursue thieves, whatever the color of their collars."
Mr. BHARARA praised the work of the Federal Bureau of Investigation in the investigation of this case.
This case is being prosecuted by the Office's Complex Frauds Unit. Assistant United States Attorney DAVID I. MILLER is in charge of the prosecution.
According to the criminal Information to which TEDESCHI pleaded guilty, documents previously filed in this case, and statements made in court: While employed at the investment firm, TEDESCHI engaged in a seven-year scheme to defraud the firm. Among other things, TEDESCHI forged the signatures of officers who had check-signing authority on company checks and used the company checks to make payments on his personal expenses or to himself directly. TEDESCHI also obtained authorized representatives' signatures on the firm's checks to make payments on what TEDESCHI represented to be company expenses, but which were actually for his personal expenses. Additionally, TEDESCHI caused unauthorized charges to be made on the investment firm's American Express account.
In all, TEDESCHI stole over $734,000 from the firm, over $633,000 of which was used to pay his personal American Express bills. TEDESCHI directed $7,500 to the payment of the mortgage on his home; $2,500 to the payment of telephone bills; and $12,000 to personal expenses charged on the firm's American Express account. He also caused the firm to pay him directly approximately $79,000.
TEDESCHI, 51, of Morris Plains, New Jersey, pleaded guilty to one count of mail fraud and one count of aggravated identity theft. TEDESCHI faces a maximum sentence of 20 years in prison on the mail fraud count, and a maximum fine of the greater of $250,000 or twice the gross pecuniary gain or loss from the offense. On the aggravated identity theft charge, TEDESCHI faces an additional two-year sentence that would be served consecutively with a sentence on the mail fraud charge. Sentencing is scheduled for June 21, 2010, at 11:00 a.m. before Judge KAPLAN.
U.S. Attorney BHARARA stated: "Richard Tedeschi abused his authority over his firm's finances, turning a position of oversight into something underhanded. After years of using forgery and fraud to siphon $730,000 for his own benefit, Tedeschi's gravy train is at an end. We will continue to partner with the Federal Bureau of Investigation to pursue thieves, whatever the color of their collars."
Mr. BHARARA praised the work of the Federal Bureau of Investigation in the investigation of this case.
This case is being prosecuted by the Office's Complex Frauds Unit. Assistant United States Attorney DAVID I. MILLER is in charge of the prosecution.
Monday, March 22, 2010
Garnerville, New York Woman Going To Prison For Embezzling Money From New City Bank
Today at 2 p.m., Milagros Rodriguez of Garnerville has been ordered to turn herself to federal authorities to begin her 33-month prison term for embezzling $700,000 from customer accounts at the Hudson City Savings Bank in New City. Rodriguez, 40, once a manager of the New City branch, plead guilty to making about 80 unauthorized transactions, periodically from April 2002 to March of 2009, according to the U.S. Attorney’s Office in White Plains. She pleaded guilty in December to one count of embezzlement.
U.S. District Court Judge Cathy Seidel sentenced Rodriguez on Feb. 19 to 33 months on federal prison, 60 months of supervised released. Seidel also ordered Rodriguez to pay restitution of $907,622.88 to the bank.
The criminal investigation began when two customers became concerned after learning their bank accounts had been closed and funds withdrawn in February 2009, leading the Hudson City Savings Bank to conduct an audit and bring in the FBI.
Based on the criminal investigation by the FBI and the Rockland District Attorney’s Office, Rodriguez was charged with one count of embezzling bank funds from the bank branch, located inside DeDeCicco Supermarket, 180 S. Main St., New City.
U.S. District Court Judge Cathy Seidel sentenced Rodriguez on Feb. 19 to 33 months on federal prison, 60 months of supervised released. Seidel also ordered Rodriguez to pay restitution of $907,622.88 to the bank.
The criminal investigation began when two customers became concerned after learning their bank accounts had been closed and funds withdrawn in February 2009, leading the Hudson City Savings Bank to conduct an audit and bring in the FBI.
Based on the criminal investigation by the FBI and the Rockland District Attorney’s Office, Rodriguez was charged with one count of embezzling bank funds from the bank branch, located inside DeDeCicco Supermarket, 180 S. Main St., New City.
Monday, March 15, 2010
New York Bank Chief Charged With TARP Fraud
The former president of a small commercial bank in New York City closed by regulators on Friday was arrested Monday for allegedly defrauding the bank and its regulators, including attempting to defraud the U.S. government's Troubled Asset Relief Program out of more than $11 million. Charles J. Antonucci Sr., the former president and chief executive of Park Avenue Bank in New York City, has been charged with fraud on the Federal Deposit Insurance Corp., making false statements on a TARP application, mail fraud, bank fraud, wire fraud, embezzlement and other charges.
More interactive graphics and photos "Antonucci allegedly put his personal greed ahead of his professional duties, deliberately and repeatedly deceived regulators and even attempted to obtain through fraud more than $11 million in taxpayer rescue from the Troubled Asset Relief Program," said Preet Bharara, the U.S. attorney in Manhattan, at a news conference announcing the charges.
Mr. Antonucci, who was president and CEO of the bank from June 2004 until his resignation in October 2009, is the first person to be charged criminally with attempting to defraud TARP, the bank bailout program passed as the nation teetered on the verge of an economic meltdown in 2008, prosecutors said.
The investigation into Antonucci's alleged conduct is ongoing, Mr. Bharara said.
In light of the allegations, Mr. Bharara said his office and banking regulators will take a harder look at troubled and failing banks in New York state in order to root out any similar malfeasance.
"Whenever and wherever we find there's misconduct, we will use every technique and every tool to prosecute those responsible to the fullest extent of the law," Bharara said.
An unshaven and bespectacled Mr. Antonucci was taken into custody by federal agents at 7 a.m. EDT at his home in Fishkill, N.Y.
Wearing a red St. John's University hooded sweatshirt, blue track pants and brown loafers, Mr. Antonucci sat quietly next to his lawyer and said little at a bail hearing Monday.
Bail was set at $2 million, to be secured by his home in Fishkill and his wife's apartment in Queens, N.Y.
"These charges are what they are," said Charles Stillman, a lawyer for Mr. Antonucci. "We're going to study them and consider what our appropriate response to the charges will be."
Mr. Bharara said Mr. Antonucci's illicit activity contributed to the ultimate failure of the bank, which was closed by New York state banking regulators on Friday. The bank's branches have been sold and reopened as branches of Valley National Bancorp.
When it was seized, the bank had total assets of $520.1 million and total deposits of $494.5 million as of the end of 2009, the FDIC said.
Mr. Bharara said banking regulators downgraded the bank in 2008, ultimately finding it was undercapitalized in September 2008.
Mr. Antonucci then undertook a scheme to make it appear the bank was properly capitalized by purportedly making a personal investment in the bank, prosecutors alleged in a criminal complaint. Instead, Mr. Antonucci allegedly engaged in a sham "round-trip" using the bank's own money to make it appear he had made a personal investment, according to the complaint.
"The bank was broken, so, in October and November 2008, Antonucci methodically went about pretending to fix it," Mr. Bharara said.
The money was structured as loans to the bank by a group of companies controlled by an unnamed bank customer; the money was ultimately funneled back to Mr. Antonucci via a consulting firm he owned, according to the criminal complaint. The account signer for both company's accounts was the customer's administrative assistant, according to the complaint.
Mr. Bharara described the purported investment by Antonucci as "functionally [the] equivalent of Monopoly money."
As a result of the purported investment, Mr. Antonucci received more than 308,000 shares in the bank, giving him about 52% of the bank's outstanding shares, according to the criminal complaint.
Richard H. Neiman, New York's superintendent of banks, said the alleged fraudulent conduct was first uncovered by New York bank examiners.
James T. Hayes, special agent in charge of the New York office of the Department of Homeland Security's U.S. Immigration and Customs Enforcement, said the investigation lasted about five months.
He said Mr. Antonucci first appeared on ICE's radar after it was contacted by the agency's local office in Ecuador about an individual interested in engaging in an illegal business deal with Antonucci. He declined further comment about the alleged illegal business dealing.
Mr. Antonucci also allegedly made false statements and committed mail fraud in connection with an application by the bank for more than $11 million in TARP funds in 2008, using his purported $6.5 million investment as part of the basis for the application, prosecutors alleged in the complaint.
The FDIC advised Mr. Antonucci in February 2009, as the bank's financial condition continued to deteriorate, that it wouldn't recommend the TARP application for approval and the bank withdrew its application, according to the criminal complaint.
In the complaint, prosecutors alleged Mr. Antonucci received free flights on more than 10 occasions in 2008 and in 2009 on the bank customer's private plane, including flights to the Super Bowl in Arizona, to Panama and the Masters golf tournament in Augusta, Ga.
Mr. Antonucci allegedly approved about $8.5 million in overdrafts to the companies controlled by that customer, according to the complaint.
In addition, Mr. Antonucci allegedly arranged for the bank to lease space from three properties he owned in Fishkill, N.Y., causing the bank to spend more than $1 million to improve, lease and pay expenses on the properties, prosecutors alleged in the complaint. The bank used only one of the properties, according to the complaint.
Mr. Antonucci also allegedly stole more than $103,000 from pastors of a church in Coral Springs, Fla., by offering to pay four times their investment through a purported bond, according to the complaint. The money was deposited in an account he controlled at the bank and never repaid; it was, instead, divided between Antonucci and another unnamed co-conspirator, according to the complaint.
Park Avenue Bank of New York isn't affiliated with Park Avenue Bank in Georgia.
More interactive graphics and photos "Antonucci allegedly put his personal greed ahead of his professional duties, deliberately and repeatedly deceived regulators and even attempted to obtain through fraud more than $11 million in taxpayer rescue from the Troubled Asset Relief Program," said Preet Bharara, the U.S. attorney in Manhattan, at a news conference announcing the charges.
Mr. Antonucci, who was president and CEO of the bank from June 2004 until his resignation in October 2009, is the first person to be charged criminally with attempting to defraud TARP, the bank bailout program passed as the nation teetered on the verge of an economic meltdown in 2008, prosecutors said.
The investigation into Antonucci's alleged conduct is ongoing, Mr. Bharara said.
In light of the allegations, Mr. Bharara said his office and banking regulators will take a harder look at troubled and failing banks in New York state in order to root out any similar malfeasance.
"Whenever and wherever we find there's misconduct, we will use every technique and every tool to prosecute those responsible to the fullest extent of the law," Bharara said.
An unshaven and bespectacled Mr. Antonucci was taken into custody by federal agents at 7 a.m. EDT at his home in Fishkill, N.Y.
Wearing a red St. John's University hooded sweatshirt, blue track pants and brown loafers, Mr. Antonucci sat quietly next to his lawyer and said little at a bail hearing Monday.
Bail was set at $2 million, to be secured by his home in Fishkill and his wife's apartment in Queens, N.Y.
"These charges are what they are," said Charles Stillman, a lawyer for Mr. Antonucci. "We're going to study them and consider what our appropriate response to the charges will be."
Mr. Bharara said Mr. Antonucci's illicit activity contributed to the ultimate failure of the bank, which was closed by New York state banking regulators on Friday. The bank's branches have been sold and reopened as branches of Valley National Bancorp.
When it was seized, the bank had total assets of $520.1 million and total deposits of $494.5 million as of the end of 2009, the FDIC said.
Mr. Bharara said banking regulators downgraded the bank in 2008, ultimately finding it was undercapitalized in September 2008.
Mr. Antonucci then undertook a scheme to make it appear the bank was properly capitalized by purportedly making a personal investment in the bank, prosecutors alleged in a criminal complaint. Instead, Mr. Antonucci allegedly engaged in a sham "round-trip" using the bank's own money to make it appear he had made a personal investment, according to the complaint.
"The bank was broken, so, in October and November 2008, Antonucci methodically went about pretending to fix it," Mr. Bharara said.
The money was structured as loans to the bank by a group of companies controlled by an unnamed bank customer; the money was ultimately funneled back to Mr. Antonucci via a consulting firm he owned, according to the criminal complaint. The account signer for both company's accounts was the customer's administrative assistant, according to the complaint.
Mr. Bharara described the purported investment by Antonucci as "functionally [the] equivalent of Monopoly money."
As a result of the purported investment, Mr. Antonucci received more than 308,000 shares in the bank, giving him about 52% of the bank's outstanding shares, according to the criminal complaint.
Richard H. Neiman, New York's superintendent of banks, said the alleged fraudulent conduct was first uncovered by New York bank examiners.
James T. Hayes, special agent in charge of the New York office of the Department of Homeland Security's U.S. Immigration and Customs Enforcement, said the investigation lasted about five months.
He said Mr. Antonucci first appeared on ICE's radar after it was contacted by the agency's local office in Ecuador about an individual interested in engaging in an illegal business deal with Antonucci. He declined further comment about the alleged illegal business dealing.
Mr. Antonucci also allegedly made false statements and committed mail fraud in connection with an application by the bank for more than $11 million in TARP funds in 2008, using his purported $6.5 million investment as part of the basis for the application, prosecutors alleged in the complaint.
The FDIC advised Mr. Antonucci in February 2009, as the bank's financial condition continued to deteriorate, that it wouldn't recommend the TARP application for approval and the bank withdrew its application, according to the criminal complaint.
In the complaint, prosecutors alleged Mr. Antonucci received free flights on more than 10 occasions in 2008 and in 2009 on the bank customer's private plane, including flights to the Super Bowl in Arizona, to Panama and the Masters golf tournament in Augusta, Ga.
Mr. Antonucci allegedly approved about $8.5 million in overdrafts to the companies controlled by that customer, according to the complaint.
In addition, Mr. Antonucci allegedly arranged for the bank to lease space from three properties he owned in Fishkill, N.Y., causing the bank to spend more than $1 million to improve, lease and pay expenses on the properties, prosecutors alleged in the complaint. The bank used only one of the properties, according to the complaint.
Mr. Antonucci also allegedly stole more than $103,000 from pastors of a church in Coral Springs, Fla., by offering to pay four times their investment through a purported bond, according to the complaint. The money was deposited in an account he controlled at the bank and never repaid; it was, instead, divided between Antonucci and another unnamed co-conspirator, according to the complaint.
Park Avenue Bank of New York isn't affiliated with Park Avenue Bank in Georgia.
Thursday, March 11, 2010
Manhattan U.S. Attorney Charges President and Chief Operating Officer of Mount Vernon Money Center with Defrauding Banks, Retailers, Hospitals, and Universities out of $50 Million
PREET BHARARA, the United States Attorney for the Southern District of New York, JOSEPH M. DEMAREST, JR., the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation ("FBI"), and NEIL BAROFSKY, the Special Inspector General of the Office of the Special Inspector General for the Troubled Asset Relief Program ("SIGTARP"), announced the indictment of ROBERT EGAN, the President of Mount Vernon Money Center ("MVMC"), and BERNARD McGARRY, MVMC's Chief Operating Officer, on charges of defrauding banks, other financial institutions, retailers, hospitals, and universities out of $50 million in funds that had been entrusted to MVMC. EGAN was arrested on February 8, 2010, on a Complaint previously-filed in this case. McGARRY is expected to surrender to federal authorities tomorrow.
According to the Indictment unsealed today in Manhattan federal court and other documents filed in the case:
MVMC engaged in various cash management businesses including replenishing cash in over 5,300 Automated Teller Machines ("ATMs") owned by banks and other financial institutions. In addition, through a subsidiary called Armored Money Services ("AMS"), MVMC provided armored car services to banks, other financial institutions and retailers. MVMC also provided payroll services to various employers, including hospitals and universities, which permitted employees to cash their paychecks on their employers' premises. In connection with these businesses, MVMC owned and operated several cash vaults, in which MVMC and its affiliated businesses stored and processed cash collected from and distributed to its clients, and other cash depositories such as the Federal Reserve Bank.
From 2005 through February 2010, EGAN and McGARRY solicited and collected hundreds of millions of dollars from MVMC's clients on the false representations that they would not commingle clients' funds or use the funds for purposes other than those specified in the various contracts between MVMC and its clients. In truth and in fact, however, EGAN and McGARRY misappropriated MVMC's clients money to fund tens of millions of dollars in operating losses in MVMC's businesses, to repay outstanding client obligations, and to enrich themselves at their clients' expense.
The defendants engaged in a practice known as "playing the float." More specifically, MVMC was entrusted on a weekly basis to hold tens of millions of dollars for its clients for specific business purposes for a specified period of time. Relying upon the continual influx of funds, EGAN and McGARRY misappropriated the clients' funds for their own use, either to cover operating expenses of one or more of the MVMC operating entities, to repay prior client obligations, or for their own personal enrichment.
Furthermore, in connection with MVMC's ATM replenishment business, and in violation of MVMC's contractual obligations, MVMC commingled different banks' and other clients' money in its vaults and bank accounts. Instead of segregating cash for each of its clients, however, MVMC personnel, acting at the direction of EGAN and McGARRY, took whatever cash that arrived in the vault, regardless of its source, to fill the next day's ATMs. Additionally, McGARRY, who controlled MVMC's bank accounts, transferred funds between and among MVMC's businesses in order to cover operating losses or to repay client obligations.
EGAN and McGARRY falsely represented to clients that they would not commingle or misuse their funds. These fraudulent representations to clients were included in part in daily and weekly reports sent by e-mail to ATM clients, purporting to represent the amount of cash MVMC held in its vaults on behalf of each client. These reports, called "Vault Inventory" reports, falsely represented to each client that its funds were segregated in MVMC's vaults. In addition, the cumulative total cash balances represented on the vault inventory reports for all of MVMC's ATM clients falsely inflated the actual cash held in MVMC's vaults by tens of millions of dollars.
As a result of the fraudulent commingling and misappropriation of customer funds described above, in February 2010, MVMC had been entrusted with approximately $70 to $75 million by its clients, but, in truth and in fact, only held approximately $20 to $25 million in cash in its vaults and bank accounts. Following EGAN's arrest, the United States Attorney's Office for the Southern District of New York obtained an Order from United States District Judge RICHARD M. BERMAN, placing MVMC in receivership. As a result, a court-appointed receiver now administers the day-to-day business of MVMC, including administering claims by victims of the fraud.
If you believe you were a victim of this crime, including a victim entitled to restitution, and you wish to provide information to law enforcement and/or receive notice of future developments in the case or additional information, please contact Wendy Olsen-Clancy, the Victim Witness Coordinator at the United States Attorney's Office for the Southern District of New York, at (866) 874-8900 or Wendy.Olsen@usdoj.gov. For additional information, go to: http://www.usdoj.gov/usao/nys/victimwitness.html on the Internet.
EGAN and McGARRY are charged with one count of conspiracy to commit bank fraud and wire fraud and six counts of bank fraud. If convicted, they face a maximum penalty of 30 years in prison and a maximum fine of one million dollars or twice the gain or loss resulting from the crime for each of the counts. This case is assigned to United States District Judge JOHN F. KEENAN.
EGAN, 64, resides in Bedford Corners, New York, and McGARRY, 50, resides in Yonkers, New York.
U.S. Attorney PREET BHARARA stated: "When we first brought charges relating to MVMC in February, the scope of the criminal conduct alleged was significant. After further investigation and according to today's Indictment, however, it turns out that the alleged fraud was more than four times what was originally thought and victimized not just one bank, but also hospitals, retailers, universities, and additional banks that entrusted hundreds of millions of dollars to Robert Egan and Bernard McGarry. These two professionals allegedly breached that trust by unscrupulously misusing more than $50 million of their clients' hard-earned money. Along with our partners at the FBI and SIGTARP, this Office remains committed to rooting out corporate corruption across the financial services industry."
FBI Assistant Director-in-Charge JOSEPH DEMAREST, JR., stated: "MVMC was entrusted with millions of dollars of clients' funds, and Egan and McGarry had a responsibility to safeguard those funds. But beyond that, they affirmatively represented to those clients that they were maintaining the integrity of the funds. The allegation is that Egan and McGarry repeatedly lied about how the funds were maintained, and how much of their clients' money was really on hand. In essence, they stole their clients' money and lied to conceal the theft."
SIGTARP Special Inspector General NEIL BAROFSKY stated: "Through the TARP program, the American people are shareholders in hundreds of financial institutions, including some of the banks that are the victims of the egregious fraud alleged in the Indictment announced today. SIGTARP will work tirelessly with its law enforcement partners to take action against any illegal conduct that serves to damage the taxpayers' investments."
Mr. BHARARA praised the investigative work of the FBI and SIGTARP and added that the investigation is continuing.
This case was brought in coordination with President BARACK OBAMA's Financial Fraud Enforcement Task Force, on which Mr. BHARARA serves as a Co-Chair of the Securities and Commodities Fraud Working Group. President OBAMA established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.
This matter is being handled by the Office's Complex Frauds Unit. Assistant United States Attorneys ANTONIA M. APPS and ANNA E. ARREOLA are in charge of the prosecution.
The charges and allegations contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
According to the Indictment unsealed today in Manhattan federal court and other documents filed in the case:
MVMC engaged in various cash management businesses including replenishing cash in over 5,300 Automated Teller Machines ("ATMs") owned by banks and other financial institutions. In addition, through a subsidiary called Armored Money Services ("AMS"), MVMC provided armored car services to banks, other financial institutions and retailers. MVMC also provided payroll services to various employers, including hospitals and universities, which permitted employees to cash their paychecks on their employers' premises. In connection with these businesses, MVMC owned and operated several cash vaults, in which MVMC and its affiliated businesses stored and processed cash collected from and distributed to its clients, and other cash depositories such as the Federal Reserve Bank.
From 2005 through February 2010, EGAN and McGARRY solicited and collected hundreds of millions of dollars from MVMC's clients on the false representations that they would not commingle clients' funds or use the funds for purposes other than those specified in the various contracts between MVMC and its clients. In truth and in fact, however, EGAN and McGARRY misappropriated MVMC's clients money to fund tens of millions of dollars in operating losses in MVMC's businesses, to repay outstanding client obligations, and to enrich themselves at their clients' expense.
The defendants engaged in a practice known as "playing the float." More specifically, MVMC was entrusted on a weekly basis to hold tens of millions of dollars for its clients for specific business purposes for a specified period of time. Relying upon the continual influx of funds, EGAN and McGARRY misappropriated the clients' funds for their own use, either to cover operating expenses of one or more of the MVMC operating entities, to repay prior client obligations, or for their own personal enrichment.
Furthermore, in connection with MVMC's ATM replenishment business, and in violation of MVMC's contractual obligations, MVMC commingled different banks' and other clients' money in its vaults and bank accounts. Instead of segregating cash for each of its clients, however, MVMC personnel, acting at the direction of EGAN and McGARRY, took whatever cash that arrived in the vault, regardless of its source, to fill the next day's ATMs. Additionally, McGARRY, who controlled MVMC's bank accounts, transferred funds between and among MVMC's businesses in order to cover operating losses or to repay client obligations.
EGAN and McGARRY falsely represented to clients that they would not commingle or misuse their funds. These fraudulent representations to clients were included in part in daily and weekly reports sent by e-mail to ATM clients, purporting to represent the amount of cash MVMC held in its vaults on behalf of each client. These reports, called "Vault Inventory" reports, falsely represented to each client that its funds were segregated in MVMC's vaults. In addition, the cumulative total cash balances represented on the vault inventory reports for all of MVMC's ATM clients falsely inflated the actual cash held in MVMC's vaults by tens of millions of dollars.
As a result of the fraudulent commingling and misappropriation of customer funds described above, in February 2010, MVMC had been entrusted with approximately $70 to $75 million by its clients, but, in truth and in fact, only held approximately $20 to $25 million in cash in its vaults and bank accounts. Following EGAN's arrest, the United States Attorney's Office for the Southern District of New York obtained an Order from United States District Judge RICHARD M. BERMAN, placing MVMC in receivership. As a result, a court-appointed receiver now administers the day-to-day business of MVMC, including administering claims by victims of the fraud.
If you believe you were a victim of this crime, including a victim entitled to restitution, and you wish to provide information to law enforcement and/or receive notice of future developments in the case or additional information, please contact Wendy Olsen-Clancy, the Victim Witness Coordinator at the United States Attorney's Office for the Southern District of New York, at (866) 874-8900 or Wendy.Olsen@usdoj.gov. For additional information, go to: http://www.usdoj.gov/usao/nys/victimwitness.html on the Internet.
EGAN and McGARRY are charged with one count of conspiracy to commit bank fraud and wire fraud and six counts of bank fraud. If convicted, they face a maximum penalty of 30 years in prison and a maximum fine of one million dollars or twice the gain or loss resulting from the crime for each of the counts. This case is assigned to United States District Judge JOHN F. KEENAN.
EGAN, 64, resides in Bedford Corners, New York, and McGARRY, 50, resides in Yonkers, New York.
U.S. Attorney PREET BHARARA stated: "When we first brought charges relating to MVMC in February, the scope of the criminal conduct alleged was significant. After further investigation and according to today's Indictment, however, it turns out that the alleged fraud was more than four times what was originally thought and victimized not just one bank, but also hospitals, retailers, universities, and additional banks that entrusted hundreds of millions of dollars to Robert Egan and Bernard McGarry. These two professionals allegedly breached that trust by unscrupulously misusing more than $50 million of their clients' hard-earned money. Along with our partners at the FBI and SIGTARP, this Office remains committed to rooting out corporate corruption across the financial services industry."
FBI Assistant Director-in-Charge JOSEPH DEMAREST, JR., stated: "MVMC was entrusted with millions of dollars of clients' funds, and Egan and McGarry had a responsibility to safeguard those funds. But beyond that, they affirmatively represented to those clients that they were maintaining the integrity of the funds. The allegation is that Egan and McGarry repeatedly lied about how the funds were maintained, and how much of their clients' money was really on hand. In essence, they stole their clients' money and lied to conceal the theft."
SIGTARP Special Inspector General NEIL BAROFSKY stated: "Through the TARP program, the American people are shareholders in hundreds of financial institutions, including some of the banks that are the victims of the egregious fraud alleged in the Indictment announced today. SIGTARP will work tirelessly with its law enforcement partners to take action against any illegal conduct that serves to damage the taxpayers' investments."
Mr. BHARARA praised the investigative work of the FBI and SIGTARP and added that the investigation is continuing.
This case was brought in coordination with President BARACK OBAMA's Financial Fraud Enforcement Task Force, on which Mr. BHARARA serves as a Co-Chair of the Securities and Commodities Fraud Working Group. President OBAMA established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.
This matter is being handled by the Office's Complex Frauds Unit. Assistant United States Attorneys ANTONIA M. APPS and ANNA E. ARREOLA are in charge of the prosecution.
The charges and allegations contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Subscribe to:
Posts (Atom)
Posts
