Pennsylvania Man Arrested In $2.5 Bank Embezzlement Case - Also Faces Fraud Charges For Ripping Off eBay Customers

From the Pittsburgh Tribune-Review on 2/27/14:

A Downtown man facing prosecution on charges that include embezzling $2.5 million while he worked for the Bank of New York Mellon Corp. was arrested this week in Arizona on counterfeiting charges, federal prosecutors said.

 

Assistant U.S. Attorney Tonya Goodman on Wednesday asked U.S. District Judge Terrence McVerry to revoke the bail of Joseph Graziano, 28.

 

A grand jury indicted Graziano in September on 14 counts of bank fraud, mail fraud and embezzlement. The bank fraud counts accuse him of taking out loans and using expensive cars he no longer owned as collateral.

 

The mail fraud counts include his ripping off eBay customers by accepting thousands of dollars for electronics and sending buyers empty boxes.

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Read the story here.

Update (2/11/2015): Graziano pleads guilty.  Read an update of the story here.

2 Former Credit Union Employees In Illinois Plead Guilty To Embezzling $320K - Manager Used Money To Cover Theft From Municipality

From the FBI on 2/24/14:

Two former employees of Milledgeville Community Credit Union have pleaded guilty in separate federal cases to embezzling money from Milledgeville Community Credit Union in Milledgeville, Illinois. Kimberly Kent, 53, who was also a former treasurer of Wysox Township, pleaded guilty in federal court today, and Kelsey Selman, 37, pleaded guilty on January 28, 2014.

According to Kent’s written plea agreement, from October 2005 through February 2012, Kent embezzled approximately $219,600 from Milledgeville Community Credit Union, where she was the manager and responsible for supervising other employees. Kent was also responsible for her own cash drawer and for handling various transactions on accounts, including the deposit and withdrawal of funds to and from customers’ accounts. As stated in the plea agreement, to conceal her embezzlement, Kent created fictitious loans using the names of family members and fictitious certificates of deposit In 2009, Kent was elected treasurer of Wysox Township. Kent admitted that in August 2010, in her capacity as treasurer of Wysox Township, she used funds from Wysox Township’s account at Milledgeville Community Credit Union to cover her embezzlement. Kent used the money she embezzled for personal purposes. The deposits of the credit union were insured by the National Credit Union Administration Board.

In Selman’s written plea agreement, Selman admitted that from 2007 through February 2012, she embezzled approximately $100,975.74 from Milledgeville Community Credit Union. Selman worked as a teller for the credit union handling deposits and withdrawals on accounts, including her own credit union account. According to the plea agreement, Selman repeatedly took money over that period of time, using the credit union’s computer system to apply credits to her personal account that did not have a corresponding deposit. As a result, the credit union’s records falsely reflected that Selman’s cash drawer increased by an amount to offset the deposit into her account. After she credited the money into her account, Selman used the money she embezzled for personal purposes.
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See the full FBI announcement here.

Former Maine Bank Loan Officer Pleads Guilty To Fraud Charges In $14 Million Embezzlement Case

From the Associated Press on 2/4/14:

A former Maine bank loan officer has pleaded guilty to federal fraud and tax evasion charges, using his position to authorize over $14 million in fraudulent loans and lines of credit for 16 years.

Court documents say 56-year-old Walter Scott Fox, formerly of Cumberland, authorized the loans at Casco Northern Bank and its successor, KeyBank using people's identities without their knowledge or consent.

 

Prosecutors say Fox used over $5.8 million of the proceeds to keep the loans current and prevent the detection of his scheme. He used almost $8.2 million for personal expenses. The income wasn't reported to the Internal Revenue Service.

 

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Read the story here.

Elderly South Carolina Woman Sentenced To 6+ Years For $1 Million Loan Fraud Scheme

Christine McLamb, 72, of Florence, South Carolina, was sentenced to 75 months in prison for embezzling some $1 million from Health Facilities Federal Credit Union where she had been employed as a lending officer. McLamb, whose thefts spanned an eight year period between 1998 and 2006, was also ordered to pay restitution of $1,033,065.65. According to prosecutors, McLamb issued some 90 loans in the names of various credit union customers and kept the proceeds for herself. To cover her tracks, she would create new loans to pay off older ones. McLamb plead guilty last September to aggravated identity theft. She has appealed her sentenced. McLamb reportedly blamed her thefts on desperation due to her husband, James McLamb's poor health conditions.

Read the story here, here and here.

Michigan Man Receives Prison Sentence For Largest Fraud In History Against SBA

Patrick J. Harrington, 45, of Beverly Hills, Michigan, was sentenced on Thursday to 10 years in prison and ordered to pay $34 million in restitution for what authorities described as the largest fraud perpetrated against the US Small Business Administration. Harrington served as the vice president and office manager for Business Loan Express (BLX), before he was charged and connected to at least 89 fraudulent loans totaling about $85 million, according to the U.S. Justice Department. The fraud commenced in or about 2000 with Harrington inflating property appraisals and other bogus documentation to cause the SBA to finance a variety of businesses in the Detroit and Flint, Michigan areas. There have been 34 other individuals charged in connection with this case - half of whom have been convicted and sentenced.

Read the story, here, here and here.