Two Ohio men were charged Tuesday for allegedly embezzling nearly $1.9 million in a massive fraud case that led to the collapse of the $23.6 million Taupa Lithuanian Credit Union in Cleveland in July 2013, according to the U.S. Attorney’s office in Cleveland.
Gary Chaney, 49, of Streetsboro, and Patrick Bruckman, 58, of Chester Township, both Cleveland suburbs, were each charged with one count of conspiracy to commit theft or embezzlement from a credit union.
Bruckman and Chaney maintained personal accounts at the cooperative, as well as a corporate account for Network Systems Engineering a computer consulting firm they owned, according to the court documents.
These two men and four others including Alex Spirikaitis, Taupa Lithuanian’s former president/CEO, allegedly conspired to defraud the credit union from 2007 through 2013.
The fraud case caused a $33.5 million loss to NCUSIF, according to the NCUA Office of Inspector General’s material loss report.
Bruckman and Chaney allegedly wrote checks drawn on their personal and corporate accounts for which there were insufficient funds, court papers show.
Chaney withdrew approximately $241,000 from his personal account. Bruckman withdrew approximately $63,000 from his personal account. Both collectively withdrew $1.5 million from their corporate accounts for which there were insufficient funds. The total loss to the credit union was $1.8 million, federal prosecutors alleged.
Although Chaney and Bruckman did not have sufficient funds in their accounts to cover their withdrawals, Spirikaitis allowed the overdrafts to clear their accounts. Chaney and Bruckman also never submitted any credit applications or loan documentation for the money they received from Spirikaitis to cover their overdrafts, according to court documents.
Last week, John Struna, 51, of the Cleveland suburb of Concord Township, was indicted for allegedly embezzling $2.3 million from Taupa Lithuanian. He was indicted on one count each for conspiracy to commit bank fraud, bank fraud, and making false statements. He also was indicted on four counts of money laundering.
Spirikaitis pleaded guilty in February to one count of conspiracy to commit bank fraud.
He admitted to embezzling $4.2 million from Taupa Lithuanian between 2001 and 2013. With the funds, he built a $1.6 million home in an affluent Cleveland suburb, paid for a stadium luxury suite at Cleveland Browns games and bought nine vehicles, according to court documents.
Spirikaitis is scheduled to be sentenced Sept. 23.
Earlier this year, former teller Michael Ruksenas pleaded guilty to conspiring with Spirikaitis to embezzle more than $481,000 and former bookkeeper Vytas Apanavicius pleaded guilty to one count of conspiracy to commit embezzlement. He admitted to stealing nearly a million dollars from Taupa Lithuanian, with help from Spirikaitis.
In February, Ruksenas was sentenced to 17 months in federal prison. Apanavicius is scheduled to be sentenced Aug. 28.
Federal prosecutors expect to charge a former credit union employee who has been identified only by the initials, A.B., according to court documents.
The NCUA and the Ohio Department of Commerce took possession of Taupa Lithuanian in July 2013 and placed it into receivership because of insolvency. The Cleveland cooperative served about 1,150 members.
Showing posts with label Ohio. Show all posts
Showing posts with label Ohio. Show all posts
Wednesday, August 27, 2014
Monday, August 25, 2014
Lake County businessman recharged for embezzlement of $2.3 million from Taupa Lithuanian Credit Union in Cleveland
A federal grand jury has recharged a Lake County businessman, John Struna, in the embezzlement of $2.3 million from Taupa Lithuanian Credit Union of Cleveland.
The seven-count indictment charges Struna with seven counts of bank fraud, making false statements and money laundering. The indictment replaces a one-count, $2.5 million information filed against Struna in January.
Credit union CEO Alex Spirikaitis, former teller Michael Ruksenas and Vytas Apanavicius, a Mentor accountant, have been convicted of similar charges of defrauding the Taupa credit union, according to a news release from the office of Steven Dettelbach, U. S. Attorney for the Northern District of Ohio.
“This defendant is charged as part of a group that used others' hard earned savings as a personal piggy bank,” Dettelbach said in the release. “Mr. Struna’s greed has caught up with him with this indictment.”
The National Credit Union Administration and the Ohio Department of Commerce placed Taupa into receivership last year, due to its insolvency. The credit union had about 1,150 members and assets of approximately $24 million, according to the U.S. Attorney’s office.
The seven-count indictment charges Struna with seven counts of bank fraud, making false statements and money laundering. The indictment replaces a one-count, $2.5 million information filed against Struna in January.
Credit union CEO Alex Spirikaitis, former teller Michael Ruksenas and Vytas Apanavicius, a Mentor accountant, have been convicted of similar charges of defrauding the Taupa credit union, according to a news release from the office of Steven Dettelbach, U. S. Attorney for the Northern District of Ohio.
“This defendant is charged as part of a group that used others' hard earned savings as a personal piggy bank,” Dettelbach said in the release. “Mr. Struna’s greed has caught up with him with this indictment.”
The National Credit Union Administration and the Ohio Department of Commerce placed Taupa into receivership last year, due to its insolvency. The credit union had about 1,150 members and assets of approximately $24 million, according to the U.S. Attorney’s office.
Monday, August 11, 2014
Sheffield Lake, Ohio man charged with embezzling $2.9 million from Medical Mutual
Joseph F. Satava, III, age 69, was charged in a criminal information with one count of theft of embezzlement in connection with health case.
Satava embezzled approximately $2.9 million from his employer, Medical Mutual, between August 1997 and November 2013, according to the information.
Satava began working for Medical Mutual in 1971, and held the position of Manager of Credit and Collections for the past 20 years. In this capacity, he had the authority and managerial discretion to request and approve checks in amounts up to $5,000. During his tenure, Satava discovered a way to use this managerial authority to create reimbursement checks that he could then embezzle, steal, and convert, undetected, to his own personal use, according to the information.
To accomplish his embezzlement, Satava reviewed weekly printouts of the company's accounts receivable trial balance statements to identify new companies that had signed contracts for insurance coverage. The weekly printouts included the amounts submitted by each company as the first payment for the insurance coverage. These payments were referred to as "binder payments." Each binder payment was credited to the finance division's "Binder Suspense Account." At the end of each month, each company payment was then credited to the appropriate client-specific revenue account, according to information.
During most weeks, Satava selected between two and four companies from this printout that made binder payments under $5,000 and created a reimbursement check in the exact amount of each respective customer check submitted to the company. He caused the reimbursement check to be created by completing a company check reimbursement form. On the form, Satava listed an employee of the client company as payee, and requested payment in the amount of the company's binder check. He stated on the form that insurance coverage had been denied as the reason for the requested reimbursement.
To conceal his embezzlement, Satava did not charge each reimbursement to the Binder Suspense Account. Instead, he charged the checks to an account that handled several billions of dollars of revenue each year. As such, the checks created by Satava were immaterial in amount relative to the volume of funds passing through this account, so the checks were not detected. Because the reimbursement checks were not charged against the account into which the binder payments were deposited, the coverage for each client company still went into effect, according to the information.
To negotiate the check, Satava forged the name of the payee appearing on the reimbursement check that he used without authorization. After he forged each check, he countersigned his own name beneath the forged name. Defendant used ATMs to deposit each check into his own personal bank account to avoid scrutiny from bank officials regarding the third party checks, according to the information.
Satava produced at least 1,382 reimbursement checks that he forged, countersigned, and deposited during his tenure as the manager of credit and collections, according to the information.
Satava used the embezzled funds to pay for living expenses that were otherwise beyond his means, such as furniture and other household items, his adult son's personal expenses, a car loan, travel and personal vacations and a retirement home on Lake Erie, according to the information.
If convicted, the defendant's sentence will be determined by the court after a review of factors unique to the case, including the defendant's prior criminal record, if any, the defendant's role in the offense, and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
Sunday, February 9, 2014
Spirikaitis Pleads Guilty in Cleveland
Alex R. Spirikaitis pleaded guilty Monday in U.S District Court to one count of conspiracy to commit bank fraud at the failed Taupa Lithuanian Credit Union.
The 51-year-old former president/CEO could be sentenced to 30 years in federal prison and a $1 million fine for his role in the $15 million embezzlement, one of the largest in credit union history. Spirikaitis did not make a statement in court regarding the plea.
His sentencing hearing will be held May 9.
Also Monday, former Bookkeeper Vytas Apanavicius pleaded guilty to one count of conspiracy to commit embezzlement and also faces a May 9 sentencing hearing.
Apanavicius owned VPA Accounting Inc., through which he provided bookkeeping and accounting services from 1995 through 2013. He is accused of stealing nearly a million dollars from Taupa Lithuanian, with help from Spirikaitis.
Spirikaitis admitted to personally embezzling about $4.2 million from Taupa Lithuanian between 2001 and 2013. With those stolen funds, he built a $1.6 million home in an affluent Cleveland suburb, paid for a stadium luxury suite at Cleveland Browns games and bought nine vehicles.
Spirikaitis also inexplicitly used embezzled credit union funds to amass an arsenal of semi-automatic weapons and more than 10,000 rounds of ammunition that he stored at the cooperative’s office in Cleveland.
Sometime after Spirikaitis was hired at the cooperative’s president/CEO in 1995, he began to conspire with three former employees and members to embezzle millions and managed to conceal that theft from auditors, the board of directors and members.
For years, the six individuals wrote checks against their credit union accounts with the understanding that Spirikaitis would not require them to make personal deposits to cover overdrafts. Additionally, Spirikaitis did not make personal deposits to cover overdrafts in his own accounts.
Instead, the former CEO transferred funds from Taupa Lithuanian internal accounts to cover the overdrafts. In many cases, these overdrafts amounted to hundreds of thousands of dollars.
Spirikaitis initially concealed the embezzlement scheme by simply taping over Taupa’s financial statements with false information, which he provided to auditors. Court documents also show he later used a software program to manipulate and print financial statements.
Federal prosecutors also unveiled that Spirikaitis provided Taupa’s correspondent bank, Corporate One Federal Credit Union in Columbus, Ohio, with an incorrect zip code for Taupa’s auditors, which caused the original account statements from the correspondent bank to be mailed to a post office box in Cleveland that Spirikaitis controlled, allowing him to alter the statements.
Two other individuals, former teller Michael Ruksenas and credit union member John Struna, have each been charged with one count of conspiracy to commit embezzlement.
Three more people are expected to face charges in the coming days or weeks. Those individuals have been identified in court documents only by their initials.
A.B. was a full-time employee at Taupa Lithuanian CU from 1991 to 2004 and worked part-time at the credit union from 2004 to July 2013, according to court documents. Two other individuals, G.C. and P.B. were members and provided IT services to the cooperative from a company they jointly owned, show court documents.
The NCUA and the Ohio Department of Commerce took possession of Taupa Lithuanian and placed it into receivership due to its insolvency last July.
The 51-year-old former president/CEO could be sentenced to 30 years in federal prison and a $1 million fine for his role in the $15 million embezzlement, one of the largest in credit union history. Spirikaitis did not make a statement in court regarding the plea.
His sentencing hearing will be held May 9.
Also Monday, former Bookkeeper Vytas Apanavicius pleaded guilty to one count of conspiracy to commit embezzlement and also faces a May 9 sentencing hearing.
Apanavicius owned VPA Accounting Inc., through which he provided bookkeeping and accounting services from 1995 through 2013. He is accused of stealing nearly a million dollars from Taupa Lithuanian, with help from Spirikaitis.
Spirikaitis admitted to personally embezzling about $4.2 million from Taupa Lithuanian between 2001 and 2013. With those stolen funds, he built a $1.6 million home in an affluent Cleveland suburb, paid for a stadium luxury suite at Cleveland Browns games and bought nine vehicles.
Spirikaitis also inexplicitly used embezzled credit union funds to amass an arsenal of semi-automatic weapons and more than 10,000 rounds of ammunition that he stored at the cooperative’s office in Cleveland.
Sometime after Spirikaitis was hired at the cooperative’s president/CEO in 1995, he began to conspire with three former employees and members to embezzle millions and managed to conceal that theft from auditors, the board of directors and members.
For years, the six individuals wrote checks against their credit union accounts with the understanding that Spirikaitis would not require them to make personal deposits to cover overdrafts. Additionally, Spirikaitis did not make personal deposits to cover overdrafts in his own accounts.
Instead, the former CEO transferred funds from Taupa Lithuanian internal accounts to cover the overdrafts. In many cases, these overdrafts amounted to hundreds of thousands of dollars.
Spirikaitis initially concealed the embezzlement scheme by simply taping over Taupa’s financial statements with false information, which he provided to auditors. Court documents also show he later used a software program to manipulate and print financial statements.
Federal prosecutors also unveiled that Spirikaitis provided Taupa’s correspondent bank, Corporate One Federal Credit Union in Columbus, Ohio, with an incorrect zip code for Taupa’s auditors, which caused the original account statements from the correspondent bank to be mailed to a post office box in Cleveland that Spirikaitis controlled, allowing him to alter the statements.
Two other individuals, former teller Michael Ruksenas and credit union member John Struna, have each been charged with one count of conspiracy to commit embezzlement.
Three more people are expected to face charges in the coming days or weeks. Those individuals have been identified in court documents only by their initials.
A.B. was a full-time employee at Taupa Lithuanian CU from 1991 to 2004 and worked part-time at the credit union from 2004 to July 2013, according to court documents. Two other individuals, G.C. and P.B. were members and provided IT services to the cooperative from a company they jointly owned, show court documents.
The NCUA and the Ohio Department of Commerce took possession of Taupa Lithuanian and placed it into receivership due to its insolvency last July.
Saturday, January 18, 2014
CU Manager/Treasurer Faces Embezzlement Charge
William J. Memmer, a former assistant manager and treasurer at the failed G.I.C. Federal Credit Union in Euclid, Ohio, was charged last week with embezzling nearly $2 million and falsifying records, according to the U.S. Attorney's Office.
The NCUA liquidated the 3,476-member, $15.5 million cooperative on Dec. 13, 2012, after declaring it to be insolvent.
According to a material loss review released Dec. 2, 2013, by the NCUA's Office of Inspector General, the credit union's failure was caused by fraud and resulted in an estimated loss of $7 million to the National Credit Union Share Insurance Fund.
Memmer, 63, a resident of Lakewood, Ohio, is accused of using blank G.I.C. FCU checks to pay off $1,843,007 in debt on 15 personal credit card accounts and falsifying the credit union's quarterly financial reports to hide the theft, beginning as early as 2003. He also allegedly falsified confirmations of G.I.C. FCU's assets by as much as $5.7 million, according to court documents.
“Memmer took advantage of his high-level position of trust by falsifying records and funneling money,” said Stephen Anthony, special agent in charge of the FBI's Cleveland office. “The FBI will continue efforts to see that fraudsters like Memmer are brought to justice.”
Memmer is charged with one count of embezzlement and one count of making false entries. He was charged in a criminal information, which is often filed when a suspect cooperates with prosecutors and intends to plead guilty.
“When those who hold trusted positions in financial institutions and those they work with betray the trust of the depositors, as is alleged in this matter, federal law enforcement will take all appropriate action to hold them accountable,” said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio.
According to the OIG report, the NCUA could have done more to prevent G.I.C.'s failure.
The report suggested the agency should go to Congress, if needed, to get additional authority to access credit union audit papers.
According to the report, several factors allowed the fraud to go undetected, including senior management displaying “questionable” integrity such as overstating assets by $8.1 million, the supervisory committee failing to complete audits for three consecutive fiscal years and the board of directors exhibiting lack of supervision and failing to exercise responsibilities.
To prevent similar issues in the future, the OIG recommended that the NCUA “reinforce documentation, communication, and follow up procedures required for incomplete or otherwise unacceptable external auditor reports to ensure appropriate visibility for follow up and escalation of administrative remedies if the issues are not resolved.”
NCUA management responded that corrective action had already been taken through the implementation of Chapter 5 of the National Supervision Policy Manual dealing with audits, recordkeeping and fraud, according to the OIG report. The OIG recommended requiring examiners to get audit reports directly from independent auditors rather than through credit union management. NCUA management said it “does not believe the auditor has a legal obligation to share their audit report with NCUA as a condition of share insurance.”
The NCUA liquidated the 3,476-member, $15.5 million cooperative on Dec. 13, 2012, after declaring it to be insolvent.
According to a material loss review released Dec. 2, 2013, by the NCUA's Office of Inspector General, the credit union's failure was caused by fraud and resulted in an estimated loss of $7 million to the National Credit Union Share Insurance Fund.
Memmer, 63, a resident of Lakewood, Ohio, is accused of using blank G.I.C. FCU checks to pay off $1,843,007 in debt on 15 personal credit card accounts and falsifying the credit union's quarterly financial reports to hide the theft, beginning as early as 2003. He also allegedly falsified confirmations of G.I.C. FCU's assets by as much as $5.7 million, according to court documents.
“Memmer took advantage of his high-level position of trust by falsifying records and funneling money,” said Stephen Anthony, special agent in charge of the FBI's Cleveland office. “The FBI will continue efforts to see that fraudsters like Memmer are brought to justice.”
Memmer is charged with one count of embezzlement and one count of making false entries. He was charged in a criminal information, which is often filed when a suspect cooperates with prosecutors and intends to plead guilty.
“When those who hold trusted positions in financial institutions and those they work with betray the trust of the depositors, as is alleged in this matter, federal law enforcement will take all appropriate action to hold them accountable,” said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio.
According to the OIG report, the NCUA could have done more to prevent G.I.C.'s failure.
The report suggested the agency should go to Congress, if needed, to get additional authority to access credit union audit papers.
According to the report, several factors allowed the fraud to go undetected, including senior management displaying “questionable” integrity such as overstating assets by $8.1 million, the supervisory committee failing to complete audits for three consecutive fiscal years and the board of directors exhibiting lack of supervision and failing to exercise responsibilities.
To prevent similar issues in the future, the OIG recommended that the NCUA “reinforce documentation, communication, and follow up procedures required for incomplete or otherwise unacceptable external auditor reports to ensure appropriate visibility for follow up and escalation of administrative remedies if the issues are not resolved.”
NCUA management responded that corrective action had already been taken through the implementation of Chapter 5 of the National Supervision Policy Manual dealing with audits, recordkeeping and fraud, according to the OIG report. The OIG recommended requiring examiners to get audit reports directly from independent auditors rather than through credit union management. NCUA management said it “does not believe the auditor has a legal obligation to share their audit report with NCUA as a condition of share insurance.”
Spirikaitis Charges Reveal Six-Person Fraud Ring
Former Taupa Lithuanian Credit Union CEO Alex R. Spirikaitis was charged Wednesday with conspiracy for his role in defrauding the credit union out of $15 million.
Spirikiaitis used some of those stolen funds to build a $1.6 million home, pay for a luxury suite at Cleveland Browns games, buy nine vehicles and amass an arsenal of semi-automatic weapons and more than 10,000 rounds of ammunition he stored at the cooperative’s Cleveland office, according to federal prosecutors.
Spirikaitis, 51, was charged with one count of conspiracy to commit bank fraud. His arraignment in U.S. District Court has not yet been scheduled.
He personally embezzled about $4.2 million from Taupa Lithuanian CU between 2001 and 2013, federal prosecutors charge.
“This defendant stole millions of dollars from credit union members who entrusted him,” Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio said. “He lived a life of luxury based on stolen money and now he must own up for those actions.”
Spirikaitis also conspired with six people – two that have been charged – and four others who were identified only by their initials, according to a prepared statement from federal prosecutors. Their alleged embezzlement contributed to the total $15 million fraud.
Michael Ruksenas, who worked at Taupa Lithuanian as a teller, pleaded guilty in U.S. District Court in Cleveland in December to conspiring to embezzle more than $481,000 from the failed credit union.
As part of a plea deal, Ruksenas agreed to cooperate with and testify for federal prosecutors.
On Monday, federal prosecutors charged Taupa Lithuanian member John Struna, 51, of the Cleveland suburb of Concord Township, with one count of conspiracy to commit theft or embezzlement from a credit union.
Struna, who had personal and corporate accounts, conspired with Spirikaitis to overdraw Struna’s accounts by $2.5 million, according to the federal prosecutors.
In their prepared statement, federal prosecutors also described other people only by their initials who allegedly conspired with Spirkaitis to embezzle funds. The former CEO allegedly transferred funds to cover overdrafts for others who worked at Taupa Lithuanian or had accounts there.
They include two employees and two members, according to federal prosecutors:
- A.B., who worked at Taupa between 1991 and 2013 and withdrew more than $1.3 million, for which there were insufficient funds;
- G.C., who withdrew approximately $1 million from accounts for which there were insufficient funds between 2001 and 2013;
- P.B., who withdrew approximately $1 million from accounts for which there were insufficient funds between 2001 and 2013; and,
- V.A., who worked at Taupa Lithuanian as a bookkeeper, and withdrew approximately $120,000 from accounts for which there were insufficient funds.
The NCUA and the Ohio Department of Commerce took possession of Taupa Lithuanian last July and placed it into receivership due to its insolvency. Taupa had about 1,150 members and assets of approximately $24 million.
John Struna, 51, was charged in a criminal information with one count of conspiracy to commit theft or embezzlement from a credit union.
"This defendant is part of a group that took advantage of the trust of hundreds of people for their own personal gain," Dettelbach said. "These criminal charges should serve as a reminder that there is no such things as free money."
"John Struna willfully overdrew his credit union accounts to the tune of $2.5 million through his relationship with a corrupt executive at the credit union," Anthony said. "The FBI will continue efforts to make sure all the individuals responsible for the collapse of the Taupa Lithuanian Credit Union are held accountable."
The National Credit Union Administration and the Ohio Department of Commerce took possession of Taupa last July and placed it into receivership due to its insolvency.
Taupa had about 1,150 members and assets of approximately $24 million, according to court records.
Credit union CEO Alex Spirikaitis and former teller Michael Ruksenas have previously been charged for their roles in conspiracies related to defrauding the credit union.
Struna maintained both personal and corporate accounts at Taupa dating back to 1995. He began a conspiracy with Spirikaitisin 2007, during which time Struna overdrew his accounts by approximately $2.5 million, according to the information.
Struna called Spirikaitis about twice a month and requested Spirikaitis' approval to withdraw additional funds. Spirikaitis made multiple transfers from Taupa's internal accounts to cover the overdrafts, according to the information.
Spirikaitis caused Taupa to make approximately 38 false and fraudulent wire transfers into Struna's personal accounts between 2007 and 2013. During that time, Struna repaid only approximately $15,000, according to the information.
In 2011, Struna requested and received $112,105 from Spirikaitis for the purchase of a condominium located in Ft. Myers, Florida. In 2012, he requested and received approximately $100,000 for an investment opportunity. At no time did Struna submit any credit applications or loan documents, according to the information.
As a result of the conspiracy, Taupa and the NCUA suffered a loss of approximately $2.5 million, according to the information.
This case is being prosecuted by Special Assistant United States Attorney Derek Kleinmann and Assistant United States Attorney Robert J. Patton. The case was investigated by the Federal Bureau of Investigation.
Saturday, November 9, 2013
Huntington, Ohio says former manager stole $2.7 million
Huntington National Bank accuses a former manager of stealing $2.7 million by diverting bank funds to his Chillicothe property-management company.
Joseph P. Molnar, 49, stole the funds between late 2008 and mid-2012 while helping to manage a Huntington subsidiary, the Columbus-based bank claimed in a lawsuit filed in U.S. District Court in Columbus.
The lawsuit accuses Molnar and unidentified parties of engaging in a racketeering scheme to divert money owed to Huntington to J. Property Management, a company owned by Molnar.
Molnar owns property in downtown Chillicothe and has been active in efforts to redevelop the community, including the landmark Carlisle Building damaged by a fire set by an arsonist in 2003.
U.S. District Court Judge Algenon Marbley is scheduled to conduct a Nov. 14 hearing on Huntington’s request for a preliminary injunction to prevent Molnar and others from transferring or spending any Huntington money.
The lawsuit, which seeks the return of $2.7 million and damages, claims that Molnar admitted on Oct. 31 to diverting money owed to Huntington into the bank account of his company. The bank filed the lawsuit the same day.
Molnar did not respond today to a message seeking comment. He has not filed a response to the lawsuit or identified a lawyer to represent him.
The lawsuit alleges the diversions occurred while Molnar helped manage the investments of Huntington Community Development Corp., a subsidiary that invests in low-income housing and other projects that yield tax credits for the bank.
Huntington accuses Molnar of diverting “development advisory fees” paid by developers to cover the costs of managing the subsidiary’s investments.
The lawsuit says that Huntington did not discover the “ongoing fraud” until September. No customers lost money as a result of the alleged scheme, said Huntington spokeswoman Maureen Brown.
No criminal charges have been filed against Molnar. A spokesman for the U.S. attorney's office said it could not comment. "We referred the issue to the appropriate law-enforcement officials and expect prosecution to the fullest extent of the law," Brown said.
Joseph P. Molnar, 49, stole the funds between late 2008 and mid-2012 while helping to manage a Huntington subsidiary, the Columbus-based bank claimed in a lawsuit filed in U.S. District Court in Columbus.
The lawsuit accuses Molnar and unidentified parties of engaging in a racketeering scheme to divert money owed to Huntington to J. Property Management, a company owned by Molnar.
Molnar owns property in downtown Chillicothe and has been active in efforts to redevelop the community, including the landmark Carlisle Building damaged by a fire set by an arsonist in 2003.
U.S. District Court Judge Algenon Marbley is scheduled to conduct a Nov. 14 hearing on Huntington’s request for a preliminary injunction to prevent Molnar and others from transferring or spending any Huntington money.
The lawsuit, which seeks the return of $2.7 million and damages, claims that Molnar admitted on Oct. 31 to diverting money owed to Huntington into the bank account of his company. The bank filed the lawsuit the same day.
Molnar did not respond today to a message seeking comment. He has not filed a response to the lawsuit or identified a lawyer to represent him.
The lawsuit alleges the diversions occurred while Molnar helped manage the investments of Huntington Community Development Corp., a subsidiary that invests in low-income housing and other projects that yield tax credits for the bank.
Huntington accuses Molnar of diverting “development advisory fees” paid by developers to cover the costs of managing the subsidiary’s investments.
The lawsuit says that Huntington did not discover the “ongoing fraud” until September. No customers lost money as a result of the alleged scheme, said Huntington spokeswoman Maureen Brown.
No criminal charges have been filed against Molnar. A spokesman for the U.S. attorney's office said it could not comment. "We referred the issue to the appropriate law-enforcement officials and expect prosecution to the fullest extent of the law," Brown said.
Saturday, September 28, 2013
Former Beavercreek Bank Branch Manager Pleads Guilty to Embezzlement in Ohio
Diane Elizabeth Niehaus, 40, of Beavercreek, Ohio, pleaded guilty to one count each of embezzlement, money laundering, and filing a false income tax return with the Internal Revenue Service (IRS) for her scheme to embezzle thousands of dollars from the accounts of customers of the branch bank she managed in Centerville, Ohio.
Carter M. Stewart, United States Attorney for the Southern District of Ohio; Kathy A. Enstrom, Special Agent in Charge, Internal Revenue Service, Criminal Investigation, Cincinnati Field Office; and Kevin R. Cornelius, Special Agent in Charge, Federal Bureau of Investigation, Cincinnati Field Office, announced the guilty pleas entered before U.S. District Judge Timothy S. Black.
According to court documents, Niehaus managed the Union Savings Bank branch in Centerville between 2007 and 2010. Using her position with USB, Niehaus created fraudulent withdrawal slips to withdraw thousands of dollars in funds from multiple customer accounts using cashier’s checks or official checks she wrote to herself between 2008 and 2010. Niehaus illegally earned thousands of dollars through this embezzlement scheme, and she failed to report this fraudulently obtained income on her federal income tax returns.
“As we often see, the victims are not only the taxpayers but also the individuals and entities who suffer the financial harm,” said Kathy A. Enstrom, Special Agent in Charge, IRS-Criminal Investigation, Cincinnati Field Office. “This investigation is a direct result of the excellent partnership IRS, FBI, and the U.S. Attorney’s Office has in combating violations of federal law.”
Embezzlement is punishable by up to 30 years in prison. Money laundering carries a potential penalty up to 20 years and filing a false tax return has a sentence ranging up to three years in prison. The court can also impose fines and order her to pay the costs of prosecution associated with the false tax return charge. A sentencing hearing is set for January 9, 2014.
The court will conduct its own investigation prior to sentencing Niehaus, including determining the actual amount of loss to victims.
U.S. Attorney Stewart commended the cooperative investigation by special agents of the FBI and IRS, as well as Assistant U.S. Attorney Brent Tabacchi, who is prosecuting the case. U.S. Attorney Stewart also acknowledged the cooperation of U.S. Bank in the investigation.
Carter M. Stewart, United States Attorney for the Southern District of Ohio; Kathy A. Enstrom, Special Agent in Charge, Internal Revenue Service, Criminal Investigation, Cincinnati Field Office; and Kevin R. Cornelius, Special Agent in Charge, Federal Bureau of Investigation, Cincinnati Field Office, announced the guilty pleas entered before U.S. District Judge Timothy S. Black.
According to court documents, Niehaus managed the Union Savings Bank branch in Centerville between 2007 and 2010. Using her position with USB, Niehaus created fraudulent withdrawal slips to withdraw thousands of dollars in funds from multiple customer accounts using cashier’s checks or official checks she wrote to herself between 2008 and 2010. Niehaus illegally earned thousands of dollars through this embezzlement scheme, and she failed to report this fraudulently obtained income on her federal income tax returns.
“As we often see, the victims are not only the taxpayers but also the individuals and entities who suffer the financial harm,” said Kathy A. Enstrom, Special Agent in Charge, IRS-Criminal Investigation, Cincinnati Field Office. “This investigation is a direct result of the excellent partnership IRS, FBI, and the U.S. Attorney’s Office has in combating violations of federal law.”
Embezzlement is punishable by up to 30 years in prison. Money laundering carries a potential penalty up to 20 years and filing a false tax return has a sentence ranging up to three years in prison. The court can also impose fines and order her to pay the costs of prosecution associated with the false tax return charge. A sentencing hearing is set for January 9, 2014.
The court will conduct its own investigation prior to sentencing Niehaus, including determining the actual amount of loss to victims.
U.S. Attorney Stewart commended the cooperative investigation by special agents of the FBI and IRS, as well as Assistant U.S. Attorney Brent Tabacchi, who is prosecuting the case. U.S. Attorney Stewart also acknowledged the cooperation of U.S. Bank in the investigation.
Friday, September 20, 2013
Former Bank Manager Pleads Guilty to Embezzlement, Money Laundering, False Tax Return in Ohio
A former bank brand manager has pleaded guilty to embezzlement, money laundering and filing a false income tax return.
Diane Elizabeth Niehaus, 40, of Beavercreek embezzled thousand of dollars from customer accounts at the Union Savings Bank in Centerville.
Niehaus managed the bank from 2007 to 2010. According to the report, she created fraudulent withdrawal slips from multiple customer accounts using cashier's checks or official checks she wrote to herself between 2008 and 2010. It's believed she made thousands of dollars through the scheme and failed to report the income on her federal income tax returns.
The court will conduct its own investigation prior to sentencing.
A sentencing hearing is set for January 9, 2014.
Diane Elizabeth Niehaus, 40, of Beavercreek embezzled thousand of dollars from customer accounts at the Union Savings Bank in Centerville.
Niehaus managed the bank from 2007 to 2010. According to the report, she created fraudulent withdrawal slips from multiple customer accounts using cashier's checks or official checks she wrote to herself between 2008 and 2010. It's believed she made thousands of dollars through the scheme and failed to report the income on her federal income tax returns.
The court will conduct its own investigation prior to sentencing.
A sentencing hearing is set for January 9, 2014.
Thursday, August 1, 2013
Jackson Township, Ohio man accused of embezzlement
A Jackson Township financial adviser is facing a federal felony charge of bank embezzlement and five felony counts of filing false tax returns stemming from an alleged scheme to defraud multiple clients out of more than $442,000.
David Lee Cheviron, 61, was a financial accountant for FirstMerit Bank, Huntington Bank and Chase Bank from 2006 to 2010, during which time authorities believe he defrauded the banks and stole money from four clients, according to a news release from the U.S. Attorney’s Office in Cleveland.
Cheviron is accused of making unauthorized withdrawals from the investment accounts of the four clients and forging signatures to deposit money into his personal account, according to court records. He also is accused of failing to report the money received on federal tax returns.
The charges are a result of a joint investigation conducted by the FBI and Internal Revenue Service.
Federal prosecutors allege in court papers that Cheviron’s position as a financial consultant “allowed him to have personal contact with bank customers, access to bank records, and to communicate with, give directions to, and mislead employees” of the banks.
A court hearing is to be scheduled for mid-August. The charges were filed by way of a bill of information, which often signals a defendant’s cooperation with the government.
Cheviron could enter a change of plea to guilty on all or some of the charges, said Daniel Dever, a spokesman for the IRS office in Cleveland.
Cheviron’s hearing is to be in front of federal Judge Donald C. Nugent.
The case against Cheviron is being prosecuted by Assistant U.S. Attorney Vasile C. Katsaros.
David Lee Cheviron, 61, was a financial accountant for FirstMerit Bank, Huntington Bank and Chase Bank from 2006 to 2010, during which time authorities believe he defrauded the banks and stole money from four clients, according to a news release from the U.S. Attorney’s Office in Cleveland.
Cheviron is accused of making unauthorized withdrawals from the investment accounts of the four clients and forging signatures to deposit money into his personal account, according to court records. He also is accused of failing to report the money received on federal tax returns.
The charges are a result of a joint investigation conducted by the FBI and Internal Revenue Service.
Federal prosecutors allege in court papers that Cheviron’s position as a financial consultant “allowed him to have personal contact with bank customers, access to bank records, and to communicate with, give directions to, and mislead employees” of the banks.
A court hearing is to be scheduled for mid-August. The charges were filed by way of a bill of information, which often signals a defendant’s cooperation with the government.
Cheviron could enter a change of plea to guilty on all or some of the charges, said Daniel Dever, a spokesman for the IRS office in Cleveland.
Cheviron’s hearing is to be in front of federal Judge Donald C. Nugent.
The case against Cheviron is being prosecuted by Assistant U.S. Attorney Vasile C. Katsaros.
Wednesday, July 17, 2013
Spirikaitis Home Found Empty; Former CEO Wanted by Authorities in Cleveland
Alex Spirikaitis, former CEO of the liquidated Taupa Lithuanian Credit Union, is on the lam.
Local Cleveland news outlets are now reporting that a police standoff overnight at Spirikaitis’ home was in vain, because the FBI discovered the home was empty.
FBI Special Agent Vicki Anderson told the Cleveland Plain-Dealer it's unclear if Spirikaitis, who has a warrant for his arrest for fraud that led to the $23 million credit union’s failure, was ever home.
The standoff began after police attempted to arrest Spirikaitis on Tuesday night. Anderson said a person at the home told police he was there but would not surrender.
Authorities are now searching for Spirikaitis and a reward is being offered for information that will help lead to his arrest.
"We will continue the investigation and hope he decides to turn himself in and make it a lot easier on everyone," Anderson told the Plain Dealer.
The Ohio Department of Financial Institutions made the decision to liquidate the credit union after determining it was insolvent and had no prospect for restoring viable operations.
The DFI named the NCUA liquidating agent and federal officials seized the credit union Friday.
Fraud was suspected after a review of the 1,154-member credit union’s financial performance reports showed a seemingly healthy credit union with 10.31% net worth, 0.78% delinquencies and no charge offs as of March 31.
However, cost of funds was reported to be 0.87%, much higher than the peer average of 0.36%.
The failed credit union’s website revealed it was not paying above average dividends to members, and liquidity was not an issue, indicating the credit union did not have outstanding borrowings that were driving up cost of funds.
The Cleveland-based credit union reported a considerable amount of cash on its books, more than $15 million as of March 31, with just $729,595 in investments. Total loans were $7.4 million during that period.
Local Cleveland news outlets are now reporting that a police standoff overnight at Spirikaitis’ home was in vain, because the FBI discovered the home was empty.
FBI Special Agent Vicki Anderson told the Cleveland Plain-Dealer it's unclear if Spirikaitis, who has a warrant for his arrest for fraud that led to the $23 million credit union’s failure, was ever home.
The standoff began after police attempted to arrest Spirikaitis on Tuesday night. Anderson said a person at the home told police he was there but would not surrender.
Authorities are now searching for Spirikaitis and a reward is being offered for information that will help lead to his arrest.
"We will continue the investigation and hope he decides to turn himself in and make it a lot easier on everyone," Anderson told the Plain Dealer.
The Ohio Department of Financial Institutions made the decision to liquidate the credit union after determining it was insolvent and had no prospect for restoring viable operations.
The DFI named the NCUA liquidating agent and federal officials seized the credit union Friday.
Fraud was suspected after a review of the 1,154-member credit union’s financial performance reports showed a seemingly healthy credit union with 10.31% net worth, 0.78% delinquencies and no charge offs as of March 31.
However, cost of funds was reported to be 0.87%, much higher than the peer average of 0.36%.
The failed credit union’s website revealed it was not paying above average dividends to members, and liquidity was not an issue, indicating the credit union did not have outstanding borrowings that were driving up cost of funds.
The Cleveland-based credit union reported a considerable amount of cash on its books, more than $15 million as of March 31, with just $729,595 in investments. Total loans were $7.4 million during that period.
Wednesday, July 10, 2013
Former Union Savings Bank manager indicted in $675,000 embezzlement in Ohio
A former Union Savings Bank manager, accused of pilfering at least $675,000 from an elderly couple who were her clients, now faces federal charges of embezzlement, money laundering and filing a false tax return.
All of the charges against Diane Elizabeth Niehaus are felonies. The complaint against her was filed in March but sealed until late June, according to federal court records.
Niehaus, 39, is currently free, though an arrest warrant was executed March 11, according to records.
Niehaus resigned from the bank Sept. 22, 2011, three days after the Dayton Daily News published a story about her relationship with Jesse and Dorothy Cline, a Beavercreek couple whom Niehaus befriended after she met them at the bank’s Centerville branch. After Jesse’s death in March 2011, Dorothy sued Niehaus and her husband Paul, stating they had taken money from the Clines.
To settle the lawsuit, the Niehauses agreed in May 2012 to transfer $366,000 in a cash box to Cline’s attorney, and to transfer ownership of their home on Riva Court in Beavercreek to the bank, according to an affidavit of FBI Special Agent Michael R. Bush. Cline’s lawsuit claimed the Niehauses used the Clines’ money to purchase that home.
Under the settlement, the bank paid $834,066 to the estate of Dorothy Cline, who has Alzheimer’s disease and lives in an assisted care facility, according to Bush’s affidavit, which was filed with the complaint.
Attorney Craig Matthews, who represented Cline in her lawsuit, said he could not discuss the details of the settlement, but added that “we’re pleased to have brought this matter to the attention of the federal agencies through our lawsuit.”
Tom Anderson, the assistant federal public defender assigned to represent Niehaus, could not be reached for comment Monday.
Bush’s affidavit states that, between October 2007 and October 2008, Niehaus made more than $12,000 in unauthorized withdrawals from the accounts of people identified only by the initials JF and RF. Niehaus told RF that another employee had stolen the money and explained how it was done, but she “had actually explained her own embezzlement scheme to RF,” Bush wrote.
Niehaus used some of the Clione’s money to replace the missing money, Bush wrote.
The Clines’ daughters told Bush that, during late 2007, Niehaus befriended the Clines, assisting them with all of their banking activities. Jesse was medicated for several conditions, including congestive heart failure and diabetes, while Dorothy had dementia and could no longer balance her checkbook or cook meals. On Aug. 25, 2010, Niehaus became power of attorney for both of the Clines, Bush wrote.
Bank employee Venus Jackson told Bush that the Clines were not present during each of the time that she notarized documents for them and that she did not read the documents. Miami Valley Hospital records show that Jesse Cline was in the intensive care unit the day the power of attorney documents were notarized, Bush wrote.
An affidavit filed in 2012 by IRS Agent Laurel Vant stated that Niehaus and her husband both worked at Fifth Third Bank in Pickerington, Ohio, when she “caused her husband to be rewarded for loans that he had not referred” and both were fired Jan. 6, 2004 for “self-dealing and embezzlement.”
Two years later, Niehaus’ father called Fifth Third and asked about a $32,000 loan in his name for a 2003 BMW 850. He told bank officials he had never applied for the loan nor owned the car. Diane Niehaus was making the payments, according to Vant’s affidavit.
Niehaus started using her middle name, Elizabeth, when she started working at Union Savings Bank in 2006, according to Vant’s affidavit
All of the charges against Diane Elizabeth Niehaus are felonies. The complaint against her was filed in March but sealed until late June, according to federal court records.
Niehaus, 39, is currently free, though an arrest warrant was executed March 11, according to records.
Niehaus resigned from the bank Sept. 22, 2011, three days after the Dayton Daily News published a story about her relationship with Jesse and Dorothy Cline, a Beavercreek couple whom Niehaus befriended after she met them at the bank’s Centerville branch. After Jesse’s death in March 2011, Dorothy sued Niehaus and her husband Paul, stating they had taken money from the Clines.
To settle the lawsuit, the Niehauses agreed in May 2012 to transfer $366,000 in a cash box to Cline’s attorney, and to transfer ownership of their home on Riva Court in Beavercreek to the bank, according to an affidavit of FBI Special Agent Michael R. Bush. Cline’s lawsuit claimed the Niehauses used the Clines’ money to purchase that home.
Under the settlement, the bank paid $834,066 to the estate of Dorothy Cline, who has Alzheimer’s disease and lives in an assisted care facility, according to Bush’s affidavit, which was filed with the complaint.
Attorney Craig Matthews, who represented Cline in her lawsuit, said he could not discuss the details of the settlement, but added that “we’re pleased to have brought this matter to the attention of the federal agencies through our lawsuit.”
Tom Anderson, the assistant federal public defender assigned to represent Niehaus, could not be reached for comment Monday.
Bush’s affidavit states that, between October 2007 and October 2008, Niehaus made more than $12,000 in unauthorized withdrawals from the accounts of people identified only by the initials JF and RF. Niehaus told RF that another employee had stolen the money and explained how it was done, but she “had actually explained her own embezzlement scheme to RF,” Bush wrote.
Niehaus used some of the Clione’s money to replace the missing money, Bush wrote.
The Clines’ daughters told Bush that, during late 2007, Niehaus befriended the Clines, assisting them with all of their banking activities. Jesse was medicated for several conditions, including congestive heart failure and diabetes, while Dorothy had dementia and could no longer balance her checkbook or cook meals. On Aug. 25, 2010, Niehaus became power of attorney for both of the Clines, Bush wrote.
Bank employee Venus Jackson told Bush that the Clines were not present during each of the time that she notarized documents for them and that she did not read the documents. Miami Valley Hospital records show that Jesse Cline was in the intensive care unit the day the power of attorney documents were notarized, Bush wrote.
An affidavit filed in 2012 by IRS Agent Laurel Vant stated that Niehaus and her husband both worked at Fifth Third Bank in Pickerington, Ohio, when she “caused her husband to be rewarded for loans that he had not referred” and both were fired Jan. 6, 2004 for “self-dealing and embezzlement.”
Two years later, Niehaus’ father called Fifth Third and asked about a $32,000 loan in his name for a 2003 BMW 850. He told bank officials he had never applied for the loan nor owned the car. Diane Niehaus was making the payments, according to Vant’s affidavit.
Niehaus started using her middle name, Elizabeth, when she started working at Union Savings Bank in 2006, according to Vant’s affidavit
Wednesday, April 24, 2013
Ex-bank teller blames love for why he embezzled $10,000 in Ohio
“I did it for love.”
That’s the reason a former Chase Bank teller gave a judge yesterday to explain why he stole $10,000 from the bank.
“I was in a relationship, and I didn’t have any money,” Imran Z. Cheema, 24, said before he pleaded guilty in federal court to one count of embezzling. He said he wanted to impress his girlfriend with the money.
Cheema, who now lives in Tampa, Fla., worked at the bank’s Northern Lights office at 3233 Cleveland Ave. Just before he quit last summer and moved to New York, he took the cash from a teller cash dispenser and “put it in my pocket,” he told U.S. District Judge Michael H. Watson.
According to a Secret Service criminal complaint, Cheema’s theft was discovered during an audit a week after he left. The audit found that the dispenser, which tellers use to refill the cash in their drawers, was short $10,000. Surveillance video showed Cheema at the dispenser when cash was removed on July 12 and on July 13, the day he left.
When an investigator spoke by telephone with Cheema on July 25, he said he was in Pakistan, his homeland. But investigators learned from a witness that Cheema was in New York, and that’s where he was arrested on Aug. 2.
Cheema has repaid the $10,000. He said he is living in Florida with his brother because “my brother didn’t want me to get into any more trouble.” He said his father is buying a gas station in Florida so Cheema can work there.
Cheema could be sentenced to 30 years in prison and ordered to pay a $1 million fine for embezzlement. But Watson said that, based on the amount of money stolen and Cheema’s lack of a criminal record, his prison sentence likely will not exceed six months.
Watson asked Cheema if he still has the same girlfriend.
“No, your honor,” he replied.
That’s the reason a former Chase Bank teller gave a judge yesterday to explain why he stole $10,000 from the bank.
“I was in a relationship, and I didn’t have any money,” Imran Z. Cheema, 24, said before he pleaded guilty in federal court to one count of embezzling. He said he wanted to impress his girlfriend with the money.
Cheema, who now lives in Tampa, Fla., worked at the bank’s Northern Lights office at 3233 Cleveland Ave. Just before he quit last summer and moved to New York, he took the cash from a teller cash dispenser and “put it in my pocket,” he told U.S. District Judge Michael H. Watson.
According to a Secret Service criminal complaint, Cheema’s theft was discovered during an audit a week after he left. The audit found that the dispenser, which tellers use to refill the cash in their drawers, was short $10,000. Surveillance video showed Cheema at the dispenser when cash was removed on July 12 and on July 13, the day he left.
When an investigator spoke by telephone with Cheema on July 25, he said he was in Pakistan, his homeland. But investigators learned from a witness that Cheema was in New York, and that’s where he was arrested on Aug. 2.
Cheema has repaid the $10,000. He said he is living in Florida with his brother because “my brother didn’t want me to get into any more trouble.” He said his father is buying a gas station in Florida so Cheema can work there.
Cheema could be sentenced to 30 years in prison and ordered to pay a $1 million fine for embezzlement. But Watson said that, based on the amount of money stolen and Cheema’s lack of a criminal record, his prison sentence likely will not exceed six months.
Watson asked Cheema if he still has the same girlfriend.
“No, your honor,” he replied.
Wednesday, April 10, 2013
Former Manager of Huntington National Bank in Ohio Arrested for Embezzling $1.7 Million
Kevin J. Moore, age 37, was sentenced by United States District Court Judge Christopher Boyko to 51 months’ incarceration. Moore previously pleaded guilty to six counts of a criminal information.
The first count charged that from August 2008 to November 2010, Moore, while he was the manager of Huntington National Bank (HNB), in Mansfield, Ohio, embezzled approximately $1.7 million from HNB. Moore was also charged in three other counts with tax evasion in failing to report and pay taxes on the monies he had embezzled and used for his own personal benefit.
In addition, Moore was charged in another count with wire fraud for defrauding an individual of more than $360,000 in an phony investment scheme. Moore was also charged with bank fraud for opening lines of credit in Randy Meister’s name and fraudulently drawing on those lines while Moore was the manager of the Mansfield, Ohio branch of KeyBank from the fall of 2007 to the spring of 2008.
Meister pleaded guilty to misprison of a felony in concealing this bank fraud from investigator.
The information’s count one, charging embezzlement from Huntington National Bank, alleged that Moore met with bank customers who wanted to open or renew a CD or annuity account and would embezzle their money and provide these customers with a print-out that he had manufactured that falsely reflected the amount of the invested funds and earnings rate, when, in fact, the defendant had stolen these funds and there was no investment.
When CDs would come up for renewal, Moore would contact the CD customers and entice those customers to renew their CDs by offering them an inflated interest rate even though the defendant had no authority from the bank to offer such rates, and, in fact, no interest rates were to be paid on these CD investments since the defendant had stolen these funds. When a customer wanted to cash out his or her CD where defendant had stolen the funds, Moore would “flip” money from another CD customer’s account to be able to cash out that account, according to court records.
The information charged that Moore would withdraw all the CD and annuity funds he had stolen in the form of cash by falsely telling bank tellers the customers were waiting in his office to pick up these funds. In fact, according to the information, this was only a ruse perpetrated by Moore to allow him to steal, and use for his own personal benefit, the cash he had received from the tellers.
The information charged that, from on or about August 2008 to on or about November 2010, Moore stole approximately $1.7 million from HNB and its CD and annuity customers. In connection with this embezzlement scheme, the information also charged Moore with three counts of tax violations for evading his taxes for calendar years 2008, 2009, and 2010, resulting in a tax due and owing of more than $512,000. This does not include any penalties or interest owed to the I.R.S., which is subject to assessment in civil or administrative proceeding.
The information also charged that Moore committed wire fraud by defrauding an investor from 2004 through 2008 of more than $360,000. The information charged that Moore approached R.R., who was a member of the church where defendant’s father was the pastor and where defendant was an assistant pastor, and informed R.R. that he and his family was actively involved in making investments, including “day trading” (buying and selling securities within a short period of time, usually within a day, in order to secure a quick profit by any increase in trading price during that short period of time; to secure any kind of significant profit, it usually requires multitudes of day trades with securities experiencing “up ticks” in their daily trading prices).
Moore represented to R.R. that R.R. could invest $250,000 a four-year trading program and receive a return of $5,000 per month for 48 months, at which time R.R. would receive the return of his original $250,000 investment. On or about August 13, 2004, R.R. cashed out his 401K pension fund and gave Moore a check for $250,000 to invest in the above-mentioned four-year trading program, according to court documents.
On or about November 24, 2004, Moore, upon finding out R.R. owned stock, approached R.R. and convinced him to sell his stock and invest an additional $118,000, again promising a substantial return on this investment. In fact, there was no investment and the defendant used these funds for his own personal use and benefit. When R.R. requested payment from Moore, he would attempt to lull R.R. into a false sense of security in order to prevent R.R. from complaining to law enforcement officials, by paying him small amounts of money over a period of time and by telling R.R. false stories, including false statements that Moore was associated with individuals who were being murdered by organized crime criminals; that Moore and his family were in danger; and that Moore was already working with law enforcement in this organized crime case, according to court records.
In a separate bank fraud charge, the information alleged that, while Moore was the manager of KeyBank in Mansfield, Ohio, Moore had made fraudulent deposits into credit lines established at KeyBank in Meister’s name. Initially, Meister was unaware that Moore had opened these lines of credit under his name. Meister later assisted Moore in cashing out advances on the lines of credit prior to Key Bank’s discovery of allegedly false deposits. Meister was charged with misprison of a felony for allowing his name and real property to be used to establish the relevant bank accounts, assisting Moore in obtaining cash from fraudulent withdrawals from Meister’s lines of credit, and concealing Moore’s bank fraud from the proper authorities.
This case is being prosecuted by Assistant U.S. Attorney Robert J. Patton and Assistant U.S. Attorney Christian H. Stickan after an investigation by the Mansfield Resident Agency of the Federal Bureau of Investigation and the Internal Revenue Service, Criminal Investigation Division, in Cleveland, Ohio
Wednesday, February 20, 2013
Kingsville, Texas woman arrested in Ohio in embezzlement case involving credit union
A Kingsville woman was arrested Friday in Ohio on suspicion of embezzling funds from a credit union.
Maricella Garza, 37, was arrested following the return of an indictment charging her with embezzling funds from the Kingsville Community Federal Credit Union from Aug. 28, 2009, to July 9, 2010, according to the indictment.
After her arrest, Garza appeared in federal court that afternoon before U.S. Magistrate Judge Sharon L. Ovington.
According to the indictment, Garza was an employee of the credit union and embezzled about $30,555.
If convicted, Garza faces as many as 30 years in prison and as much as a $1 million fine. A bond hearing is scheduled for 1:30 p.m. Thursday in Ohio.
Maricella Garza, 37, was arrested following the return of an indictment charging her with embezzling funds from the Kingsville Community Federal Credit Union from Aug. 28, 2009, to July 9, 2010, according to the indictment.
After her arrest, Garza appeared in federal court that afternoon before U.S. Magistrate Judge Sharon L. Ovington.
According to the indictment, Garza was an employee of the credit union and embezzled about $30,555.
If convicted, Garza faces as many as 30 years in prison and as much as a $1 million fine. A bond hearing is scheduled for 1:30 p.m. Thursday in Ohio.
Thursday, January 24, 2013
Hyde Park bank teller gets prison for embezzlement scheme in Ohio
A Milford woman who worked as a teller for the U.S. Bank branch office in Hyde Park received a 27-month prison sentence for her conducting an embezzlement scheme.
Kimberly Ferguson, 53, of Milford, pleaded guilty in October to one count of bank fraud, which involved embezzling $911,000 from the bank. According to a press release from U.S. Attorney Carter Stewart's office, she had worked for the bank for 33 years. The scheme took place from 1997 to 2012, a time when she worked as a vault teller. The U.S. Attorney's reported that she created fraudulent "cash in transit" slips to disguise the theft.
"And bear in mind, this did not involve electronic transfers or checks,” Assistant U.S. Attorney Tim Mangan wrote in a sentencing memorandum filed with the court before sentencing. “The stolen funds consisted of cash that the defendant physically carried out of the bank.”
Bank officials eventually were alerted to the scheme when they found 38 or more transit slips per month at the branch.
Ferguson has been ordered to pay restitution.
Kimberly Ferguson, 53, of Milford, Ohio, was sentenced in U.S .District Court to 27 months in prison for embezzling $911,000 from the bank where she worked as a vault teller. She was also ordered to pay restitution.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, and Edward J. Hanko, Special Agent in Charge, Federal Bureau of Investigation (FBI), announced the sentence imposed today by Senior U.S. District Judge Herman J. Weber.
Ferguson was an employee of U.S. Bank for approximately 33 years, primarily at the Hyde Park branch. She used her position as the vault teller at the branch to embezzle thousands of dollars from the bank for her personal benefit and created fraudulent “cash in transit” slips to disguise the scheme.
In total, from 1997 through February 2012, Ferguson embezzled $911,000 in funds from the federally insured bank. On average, this translates to stealing more than $60,000 in cash per year for 15 years. “And bear in mind, this did not involve electronic transfers or checks,” Assistant U.S. Attorney Tim Mangan wrote in a sentencing memorandum filed with the court before sentencing. “The stolen funds consisted of cash that the defendant physically carried out of the bank.”
The scheme was ultimately detected when bank officials noticed that the defendant’s branch had as many as 38 more transits slips per month than an average branch. Ferguson pleaded guilty on October 17, 2012, to one count of bank fraud.
U.S. Attorney Stewart commended the investigation by the FBI and Assistant U.S. Attorney Mangan, who represented the United States in the case.
Kimberly Ferguson, 53, of Milford, pleaded guilty in October to one count of bank fraud, which involved embezzling $911,000 from the bank. According to a press release from U.S. Attorney Carter Stewart's office, she had worked for the bank for 33 years. The scheme took place from 1997 to 2012, a time when she worked as a vault teller. The U.S. Attorney's reported that she created fraudulent "cash in transit" slips to disguise the theft.
"And bear in mind, this did not involve electronic transfers or checks,” Assistant U.S. Attorney Tim Mangan wrote in a sentencing memorandum filed with the court before sentencing. “The stolen funds consisted of cash that the defendant physically carried out of the bank.”
Bank officials eventually were alerted to the scheme when they found 38 or more transit slips per month at the branch.
Ferguson has been ordered to pay restitution.
Kimberly Ferguson, 53, of Milford, Ohio, was sentenced in U.S .District Court to 27 months in prison for embezzling $911,000 from the bank where she worked as a vault teller. She was also ordered to pay restitution.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, and Edward J. Hanko, Special Agent in Charge, Federal Bureau of Investigation (FBI), announced the sentence imposed today by Senior U.S. District Judge Herman J. Weber.
Ferguson was an employee of U.S. Bank for approximately 33 years, primarily at the Hyde Park branch. She used her position as the vault teller at the branch to embezzle thousands of dollars from the bank for her personal benefit and created fraudulent “cash in transit” slips to disguise the scheme.
In total, from 1997 through February 2012, Ferguson embezzled $911,000 in funds from the federally insured bank. On average, this translates to stealing more than $60,000 in cash per year for 15 years. “And bear in mind, this did not involve electronic transfers or checks,” Assistant U.S. Attorney Tim Mangan wrote in a sentencing memorandum filed with the court before sentencing. “The stolen funds consisted of cash that the defendant physically carried out of the bank.”
The scheme was ultimately detected when bank officials noticed that the defendant’s branch had as many as 38 more transits slips per month than an average branch. Ferguson pleaded guilty on October 17, 2012, to one count of bank fraud.
U.S. Attorney Stewart commended the investigation by the FBI and Assistant U.S. Attorney Mangan, who represented the United States in the case.
Wednesday, November 28, 2012
2 Mansfielders in Ohio plead guilty in embezzlement of $2 million
FROM MANSFIELD NEWS JOURNAL -
Two Mansfield men pleaded guilty Monday in U.S. District Court in Cleveland to charges involving embezzlement and fraud totaling $2.1 million.
Kevin J. Moore, 35, former manager of the Huntington National Bank branch in Ontario and a KeyBank branch in Mansfield, pleaded guilty to one count of bank embezzlement, two counts of wire fraud and three counts of tax evasion.
He was represented at a hearing scheduled for 1:45 p.m. by attorney Roger M. Synenberg of Cleveland.
As part of the plea agreement, Moore agreed to pay an undetermined amount of restitution to victims. Those could include the banks, the Federal Deposit Insurance Corp. (which insures banks) and a man who was defrauded of $360,000 in a phony investment scheme, according to Robert J. Patton and Christian H. Stickan, of the Office of the U.S. Attorney.
While Moore’s assets have not yet been gauged, the probation department will look into that issue.
“He’ll be under an obligation to make that repayment,” Stickan said. “They are going to try to explore what assets are available. I don’t want to give anybody any false hopes that there’s a gold mine.”
During Monday’s 45-minute hearing, Randy L. Meister, 60, a friend of Moore’s, pleaded guilty to one charge, misprision of a felony (becoming aware of a crime and helping to conceal it), with bond set at $10,000. He was represented by a public defender.
The men, both Mansfield residents, were arraigned before Magistrate Nancy A. Vecchiarelli. Sentencing will be March 13, before Judge Christopher Boyko.
Bond was set at $20,000 for Moore and $10,000 for Meister, with both men on supervision until sentencing.
A bill of information filed by the U.S. Attorney’s office charged that Moore, while working as manager of Huntington National Bank on Village Park Court South in Ontario between August 2008 to November 2010, embezzled about $1.7 million from Huntington and its CD and annuity customers.
Moore met with Huntington customers who wanted to open or renew accounts, then pocketed the money — targeting certificates of deposit (CDs) and investments in annuities because the bank did not then send customers monthly statements for those types of accounts. The plea agreement says he offered customer phony inflated interest rates the bank would not actually provide, to entice them to keep their money in those accounts — and “flipped” money from other accounts when customers decided to cash out.
“He was telling (bank tellers) that customers were coming in and taking out the money,” Stickan said. “It’s a pretty sophisticated process. He certainly knew what he was doing when he did it.”
The information also charged Moore with three counts of tax violations for evading taxes for calendar years 2008, 2009, and 2010 in connection with that scheme. The IRS believes Moore owed more $514,720 in taxes on unreported income of $1.72 million from those three years.
Moore also was charged with wire fraud for defrauding a member of a church where he was assistant pastor of $360,000, by persuading him to put money into a phony “day-trading” scheme, then diverting the money for his own use. Moore told the man he could get returns amounting to $5,000 per month. The victim cashed out a 401K and sold stock to “invest” in the scheme.
“He (the victim) was getting small payments back, but that was done in the guise of keeping him quiet,” Stickan said.
Moore, who was manager for the Ontario branch of KeyBank from fall 2007 to spring 2008, also was charged with bank fraud for opening lines of credit in the name of Randy L. Meister, initially without his friend’s knowledge. Prosecutors say he then fraudulently drew on those lines.
The U.S. Attorney’s Office alleged one of the lines of credit was opened against a home at 234 Poplar St. that Meister owned, and that was purchased with cash Moore provided. The loss involved in that incident was $45,400, according to court records.
Meister was charged for allowing his name and real property to be used to establish the lines of credit at KeyBank, allowing Moore to proceed with fraudulent withdrawals from the lines of credit, and concealing Moore’s bank fraud from authorities. The statutory penalty for misprision of a felony is three years and a $250,000 fine.
Under federal law, the bank embezzlement and bank fraud charges against Moore must involve prison time.
“The seriousness of the bank fraud statute is reflected by the fact that those charges are non-probationable,” Patton said. “Those found guilty of those charges will go to prison, even if you have no record.
“The public has to have confidence in the banking system, and the only way to do that is to prosecute people who abuse it.”
Bank embezzlement has a maximum statutory penalty of up to 30 years and a $1 million fine. Maximum penalties for the other charges are 20 years and a $250,000 fine for wire fraud; five years and a $250,000 fine for tax evasion; and 30 years and a $1 million fine for bank fraud.
“Criminal acts are typically not foreseeable,” Patton said. “I don’t think there’s a particular defect in the processes at Huntington. He (Moore) was doing things at KeyBank (also).”
While FDIC insurance prevented bank customers from individually losing money, the U.S. Probation Office will determine what amounts of restitution the FDIC, the banks, or the church member may be owed.
Federal agencies initially began investigating the two men after Meister “came under the radar screen of the FBI” in connection with his home loan, Patton said.
“It’s not unusual for a bank, when they see unusual activity, to make a referral,” Stickan said.
Federal prosecutors said that investigation, which linked the two men, eventually converged with the others. The church member Moore persuaded to put money into the phony investment scheme independently lodged a separate complaint with the FBI in connection with his losses, the U.S. Attorney’s office said.
Two Mansfield men pleaded guilty Monday in U.S. District Court in Cleveland to charges involving embezzlement and fraud totaling $2.1 million.
Kevin J. Moore, 35, former manager of the Huntington National Bank branch in Ontario and a KeyBank branch in Mansfield, pleaded guilty to one count of bank embezzlement, two counts of wire fraud and three counts of tax evasion.
He was represented at a hearing scheduled for 1:45 p.m. by attorney Roger M. Synenberg of Cleveland.
As part of the plea agreement, Moore agreed to pay an undetermined amount of restitution to victims. Those could include the banks, the Federal Deposit Insurance Corp. (which insures banks) and a man who was defrauded of $360,000 in a phony investment scheme, according to Robert J. Patton and Christian H. Stickan, of the Office of the U.S. Attorney.
While Moore’s assets have not yet been gauged, the probation department will look into that issue.
“He’ll be under an obligation to make that repayment,” Stickan said. “They are going to try to explore what assets are available. I don’t want to give anybody any false hopes that there’s a gold mine.”
During Monday’s 45-minute hearing, Randy L. Meister, 60, a friend of Moore’s, pleaded guilty to one charge, misprision of a felony (becoming aware of a crime and helping to conceal it), with bond set at $10,000. He was represented by a public defender.
The men, both Mansfield residents, were arraigned before Magistrate Nancy A. Vecchiarelli. Sentencing will be March 13, before Judge Christopher Boyko.
Bond was set at $20,000 for Moore and $10,000 for Meister, with both men on supervision until sentencing.
A bill of information filed by the U.S. Attorney’s office charged that Moore, while working as manager of Huntington National Bank on Village Park Court South in Ontario between August 2008 to November 2010, embezzled about $1.7 million from Huntington and its CD and annuity customers.
Moore met with Huntington customers who wanted to open or renew accounts, then pocketed the money — targeting certificates of deposit (CDs) and investments in annuities because the bank did not then send customers monthly statements for those types of accounts. The plea agreement says he offered customer phony inflated interest rates the bank would not actually provide, to entice them to keep their money in those accounts — and “flipped” money from other accounts when customers decided to cash out.
“He was telling (bank tellers) that customers were coming in and taking out the money,” Stickan said. “It’s a pretty sophisticated process. He certainly knew what he was doing when he did it.”
The information also charged Moore with three counts of tax violations for evading taxes for calendar years 2008, 2009, and 2010 in connection with that scheme. The IRS believes Moore owed more $514,720 in taxes on unreported income of $1.72 million from those three years.
Moore also was charged with wire fraud for defrauding a member of a church where he was assistant pastor of $360,000, by persuading him to put money into a phony “day-trading” scheme, then diverting the money for his own use. Moore told the man he could get returns amounting to $5,000 per month. The victim cashed out a 401K and sold stock to “invest” in the scheme.
“He (the victim) was getting small payments back, but that was done in the guise of keeping him quiet,” Stickan said.
Moore, who was manager for the Ontario branch of KeyBank from fall 2007 to spring 2008, also was charged with bank fraud for opening lines of credit in the name of Randy L. Meister, initially without his friend’s knowledge. Prosecutors say he then fraudulently drew on those lines.
The U.S. Attorney’s Office alleged one of the lines of credit was opened against a home at 234 Poplar St. that Meister owned, and that was purchased with cash Moore provided. The loss involved in that incident was $45,400, according to court records.
Meister was charged for allowing his name and real property to be used to establish the lines of credit at KeyBank, allowing Moore to proceed with fraudulent withdrawals from the lines of credit, and concealing Moore’s bank fraud from authorities. The statutory penalty for misprision of a felony is three years and a $250,000 fine.
Under federal law, the bank embezzlement and bank fraud charges against Moore must involve prison time.
“The seriousness of the bank fraud statute is reflected by the fact that those charges are non-probationable,” Patton said. “Those found guilty of those charges will go to prison, even if you have no record.
“The public has to have confidence in the banking system, and the only way to do that is to prosecute people who abuse it.”
Bank embezzlement has a maximum statutory penalty of up to 30 years and a $1 million fine. Maximum penalties for the other charges are 20 years and a $250,000 fine for wire fraud; five years and a $250,000 fine for tax evasion; and 30 years and a $1 million fine for bank fraud.
“Criminal acts are typically not foreseeable,” Patton said. “I don’t think there’s a particular defect in the processes at Huntington. He (Moore) was doing things at KeyBank (also).”
While FDIC insurance prevented bank customers from individually losing money, the U.S. Probation Office will determine what amounts of restitution the FDIC, the banks, or the church member may be owed.
Federal agencies initially began investigating the two men after Meister “came under the radar screen of the FBI” in connection with his home loan, Patton said.
“It’s not unusual for a bank, when they see unusual activity, to make a referral,” Stickan said.
Federal prosecutors said that investigation, which linked the two men, eventually converged with the others. The church member Moore persuaded to put money into the phony investment scheme independently lodged a separate complaint with the FBI in connection with his losses, the U.S. Attorney’s office said.
Sunday, July 22, 2012
Youngstown woman indicted on embezzlement by bank employee in Ohio
A federal grand jury has returned an indictment charging Danielle Ladigo, age 28, of Youngstown, Ohio, with one count of theft, embezzlement, or misapplication by bank officer or employee, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment charges that from January 2008 through December 2009, Danielle Ladigo, an employee of Huntington National Bank, embezzled moneys belonging to Huntington National Bank in an amount greater than $1,000, the deposits of which were insured by the Federal Deposit Insurance Corporation, by taking cash while loading the bank’s cash dispensing machines (CDMs).
The indictment was presented to the grand jury by Assistant United States Attorney Christos N. Georgalis after an investigation by agents of the Federal Bureau of Investigation.
If convicted, the defendant’s sentence will be determined by the Court after a review of factors unique to the case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
The indictment charges that from January 2008 through December 2009, Danielle Ladigo, an employee of Huntington National Bank, embezzled moneys belonging to Huntington National Bank in an amount greater than $1,000, the deposits of which were insured by the Federal Deposit Insurance Corporation, by taking cash while loading the bank’s cash dispensing machines (CDMs).
The indictment was presented to the grand jury by Assistant United States Attorney Christos N. Georgalis after an investigation by agents of the Federal Bureau of Investigation.
If convicted, the defendant’s sentence will be determined by the Court after a review of factors unique to the case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Sunday, February 27, 2011
Embezzling CEO Sentenced in Ohio
Bernie Metz, 57, former CEO of Center Valley Federal Credit Union, will have to repay NCUA over $4.65 million and pay $200,000 to a local organization in Ohio as part of her sentence for embezzlement.
U.S. Attorney William Ihlenfeld announced that Metz received 108 months imprisonment in addition to the financial parts of the sentence. She also had to surrender properties she purchased during her decade-long embezzlement, along with several vehicles and over $14,000.
As a result of the embezzlement, NCUA closed and liquidated the CU in 2009.
"The prison sentence imposed today upon Bernie Metz brings an end to her sophisticated scheme to defraud the Center Valley Federal Credit Union and its members," said Ihlenfeld. "She embezzled millions of dollars over the past ten years and used the credit union as her own personal piggy bank. Due to the convictions obtained in this matter, her opulent lifestyle has ended. Things will be much different for Bernie Metz behind bars, and she will no longer enjoy the life of luxury to which she had become accustomed."
Affidavits filed in the case showed that Metz used embezzled funds to start a business that included both a restaurant and motel run by her and her husband.
Ihnlenfeld also indicated that the crime has continued to reverberate in the lives of the former CU's members.
"While a number of former credit union members chose to meet with me and my staff in person to discuss their issues, I know that there are many more similarly situated people who still are having problems with their credit union accounts, whether they are upside-down on their automobile loans or they feel they are being unfairly harassed by collection calls," said Ihlenfeld. "My message to those people is to make sure that they fully explore all of their rights under state and federal law, and to make sure that their legal rights are not being violated in any way."
U.S. Attorney William Ihlenfeld announced that Metz received 108 months imprisonment in addition to the financial parts of the sentence. She also had to surrender properties she purchased during her decade-long embezzlement, along with several vehicles and over $14,000.
As a result of the embezzlement, NCUA closed and liquidated the CU in 2009.
"The prison sentence imposed today upon Bernie Metz brings an end to her sophisticated scheme to defraud the Center Valley Federal Credit Union and its members," said Ihlenfeld. "She embezzled millions of dollars over the past ten years and used the credit union as her own personal piggy bank. Due to the convictions obtained in this matter, her opulent lifestyle has ended. Things will be much different for Bernie Metz behind bars, and she will no longer enjoy the life of luxury to which she had become accustomed."
Affidavits filed in the case showed that Metz used embezzled funds to start a business that included both a restaurant and motel run by her and her husband.
Ihnlenfeld also indicated that the crime has continued to reverberate in the lives of the former CU's members.
"While a number of former credit union members chose to meet with me and my staff in person to discuss their issues, I know that there are many more similarly situated people who still are having problems with their credit union accounts, whether they are upside-down on their automobile loans or they feel they are being unfairly harassed by collection calls," said Ihlenfeld. "My message to those people is to make sure that they fully explore all of their rights under state and federal law, and to make sure that their legal rights are not being violated in any way."
Sunday, January 16, 2011
Strongsville , Ohio bank teller gives cash from drawer to husband
A bank teller was sentenced Tuesday for taking cash from her drawer and giving it to her husband.
Rebecca Warden, a former teller at the National City Bank branch in Strongsville, was
sentenced to 16 months in prison and ordered to pay $888,471 in restitution after previously pleading guilty to bank fraud, Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, said.
Rebecca Warden, 34, of Parma, removed cash from her drawer and gave it
to her husband, Steve Warden, who would come into the bank and pretend to conduct legitimate banking transactions, Dettelbach said.
This took place from on or about 2006 through March 2010, according to
court documents.
During this time period, Rebecca Warden also removed cash to issue official bank checks
and money orders payable to businesses to which Steve Warden owed money.
Steve Warden, 35, of Brunswick, pleaded guilty to bank fraud charges last week
and is scheduled to be sentenced in April.
The investigation was conducted by the FBI.
Rebecca Warden, a former teller at the National City Bank branch in Strongsville, was
sentenced to 16 months in prison and ordered to pay $888,471 in restitution after previously pleading guilty to bank fraud, Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, said.
Rebecca Warden, 34, of Parma, removed cash from her drawer and gave it
to her husband, Steve Warden, who would come into the bank and pretend to conduct legitimate banking transactions, Dettelbach said.
This took place from on or about 2006 through March 2010, according to
court documents.
During this time period, Rebecca Warden also removed cash to issue official bank checks
and money orders payable to businesses to which Steve Warden owed money.
Steve Warden, 35, of Brunswick, pleaded guilty to bank fraud charges last week
and is scheduled to be sentenced in April.
The investigation was conducted by the FBI.
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