Letter of Apology » Bank Fraud

San Antonio Exporter Pleads Guilty In Ex-Im Bank Fraud

Dave Westheimer — Fri, 22 Aug 2008 06:34:58 +0000

Andrew Parker of San Antonio, owner of San Antonio Trade Group, Inc., pleaded guilty on Thursday to defrauding the Export-Import Bank of the US. WOAI reported Wednesday that US District Judge Fred Biery had given Parker one day to decide whether or not to accept a plea agreement. In an indictment unsealed May 1 (earlier here and here) Parker was accused of falsifying loan applications, submitting false reports that goods were bought with the loans, and diverting millions of the loan proceeds for his personal use. As much as $163 million was allegedly involved. He pleaded guilty to 11 of the 28 counts in the indictment, including conspiracy, wire fraud, money laundering, tax evasion, and filing false tax returns. Under the plea deal Parker faces up to ten years in prison and up to $10 million in restitution plus $495,000 in tax liability (WOAI, DOJ).

Oregon Woman Indicted In Nigerian Check Scam

Dave Westheimer — Mon, 18 Aug 2008 06:41:26 +0000

Ella Mae Letellier of Ontario, Oregon has been indicted by a federal grand jury in Boise on 29 counts of mail and wire fraud in connection with a Nigerian check scam she allegedly helped run out of Payette, Idaho. It’s a rerun of the scheme for which a Washington woman was sentenced to prison in June (earlier): a seller is paid with a phony check for more than the amount of the goods, returns the excess money and winds up liable for the entire amount when the counterfeit check is eventually returned. Letellier allegedly acted as an accomplice for Patrick Anthony of Nigeria by sending out counterfeit checks on his behalf (Idaho Statesman). This scheme has been so well publicized online that it boggles the mind that people still bite. David Hannum was right.

Attorney Pleads Guilty In Bank Loan Bid Rigging Scheme

Dave Westheimer — Tue, 29 Jul 2008 04:30:36 +0000

Attorney Paul Arparo of Hartford, Connecticut pleaded guilty on Thursday before US District Judge Alvin Thompson in Hartford to one count of conspiracy to commit financial institution bribery and one count of bank fraud in connection with a bid rigging scheme involving the sale of bank loans. Arparo admitted that between 2001 and 2007 he conspired with Kevin O’Keefe,a vice president of Fleet Bank (later acquired by Bank of America) and an unnamed real estate developer to rig the bidding process on portfolios of distressed loans that Fleet offered for sale. O’Keefe, who pleaded guilty in June, supplied Arparo and the developer with inside information and gave false information to other bidders so that the developer could submit the winning bid on the properties. Arparo acknowledged that he and O’Keefe shared $1.4 million in payoffs from the developer. Aparo faces a statutory maximum of 35 years in prison. His sentencing is scheduled for October 14 (Newsday, DOJ).

Bank Branch Manager Sentenced to 168 Months In Prison For Long-Running Embezzlement

Dave Westheimer — Fri, 18 Jul 2008 06:17:00 +0000

Rhonda Harris of Wagoner, Oklahoma on Tuesday was sentenced to 168 months in prison by US District Judge Ronald A. White in Muskogee for embezzling millions from bank customers of Arvest Bank and its predecessors over a 25 year period. Harris pleaded guilty in March 2008 to one count of embezzlement by a bank officer and one count of money laundering; she also received 120 months on the money laundering count, to be served concurrently. From the sentencing press release:

On October 23, 2006, a bank customer went to the bank branch in Tulsa to cash a CD she had purchased at the Wagoner branch. Tulsa branch officers were unable to find evidence that the CD existed. The officials researched other accounts and determined that several accounts had been compromised.

An executive Vice President immediately confronted the defendant. She confessed that she had been stealing from the bank for 25 years. She was quickly removed from the bank and interviewed that day. She gave a partial list of affected customers, accounts, and amounts.

82 customers suffered losses and about $5.6 million has been paid to them by the bank and Chubb Insurance. That amount includes interest that would have been earned had the money not been stolen (The Oklahoman, DOJ).

Bank Teller Supervisor Admits Long Term Theft

Dave Westheimer — Thu, 10 Jul 2008 05:36:56 +0000

Karen Baer of Westminster, Maryland on Monday pleaded guilty to bank fraud before US District Judge Andre M. Davis in Baltimore. Baer was a teller and teller supervisor from 1998 to 2007 at PNC Bank and its predecessors, Westminster Union Bank and Mercantile Bank. After PNC bought Mercantile last September, auditors uncovered a long running scheme in which Baer allegedly stole from the branch where she worked, $10,000 at a time. In the plea agreement, she admits to stealing “at least $400,000″ but the alleged total amount is $1.05 million. Baer has agreed to asset forfeiture; she faces a statutory maximum of 30 years in prison. Sentencing is scheduled for October 3 (DOJ).

Nigerian Check Scam Accomplice Sentenced To Two Years In Prison

Dave Westheimer — Mon, 30 Jun 2008 06:09:33 +0000

In Tacoma on Wednesday, US District Judge Benjamin Settle sentenced Edna Fiedler of Olympia, Washington to two years in prison for her role as an accomplice in a Nigerian check scam. This is the all-too-familiar scheme in which a mark who has goods for sale is paid with a phony check for more than the amount and asked to return some of the proceeds, eventually winding up on the hook for the whole amount. Fiedler had pleaded guilty in March to conspiracy to commit bank, wire and mail fraud. She worked in connection with a man from Lagos, Nigeria who shipped counterfeit checks and money orders to her with instructions on how to fill them out and where to ship them. When she was arrested in December she had already shipped out over $600,000 in phony checks and money orders and had $1.1 million more ready to ship. No word on whether the people who fell for the scam will be investigated for terminal idiocy (Seattle Times).

Rigas Sentences Reduced By Three Years

Dave Westheimer — Wed, 25 Jun 2008 20:50:13 +0000

US District Judge Leonard Sand on Wednesday reduced the sentences of Adelphia Communications founder and former CEO John Rigas and his son, former Adelphia CFO Timothy Rigas by three years each. Sand resentenced John Rigas, now 83, to 12 years in prison and Timothy Rigas to 17 years in prison. The resentencing came about after the US Circuit Court of Appeals for the Second Circuit in May 2007 reversed their conviction on one count of bank fraud, citing insufficient evidence. Judge Sand ruled that “a minimal adjustment is appropriate” in light of that reversal. An attorney for the Rigases said they plan an immediate appeal, calling the revised sentences “harsh beyond measure.” However, the Second Circuit did uphold their convictions on 22 of 23 counts and the US Supreme Court in March 2008 rejected their appeals without comment (Reuters, earlier here and here ).

Renzi Co-Defendant Convicted In Texas Case

Dave Westheimer — Wed, 18 Jun 2008 04:34:58 +0000

James Sandlin of Sherman, Texas, former business associate of US Rep. Rick Renzi (R-Ariz.) who was indicted with Renzi in February (earlier), was convicted June 11 by a federal jury in Texas in an unrelated case on two counts of submitting a false statement to a federally insured financial institution. Sherman was indicted in November 2007 for submitting financial statements to the Independent Bank of Sherman which allegedly failed to disclose $996,000 in loans from a retired Sherman couple. The maximum penalty on each count is 30 years in prison; a sentencing date was not disclosed (Houston Chronicle, DOJ).

Sandlin has pleaded not guilty in the Renzi case, which is scheduled to go to trial on October 14. He is named in 27 counts in that indictment including conspiracy, wire fraud and honest services wire fraud, money laundering and extortion under color of official right. He and Renzi are accused of using Renzi’s office to extort investors trying to obtain mineral rights.

Judge Hears Rigas Appeal For Resentencing

Dave Westheimer — Tue, 27 May 2008 06:09:23 +0000

At a resentencing hearing in Manhattan on Thursday, an attorney for imprisoned Adelphia Communications founder and former CEO John Rigas and his son, former Adelphia CFO Timothy Rigas asked US District Judge Leonard Sand to reevaluate their sentences. The Rigases participated in the hearing by video hookup from prison. Both were convicted of securities fraud, bank fraud and conspiracy in 2004; John Rigas, now 83, was sentenced to 15 years in prison, while Timothy Rigas received a 20 year sentence. The US Circuit Court of Appeals for the Second Circuit upheld their convictions on 22 of 23 counts in May 2007; they began serving their sentences last August, and the US Supreme Court in March 2008 rejected their appeals without comment (earlier). But the Second Circuit reversed their conviction on one count of bank fraud, citing insufficient evidence, which led to the resentencing hearing.

Attorney Lawrence McMichael argued the reversal of the single count was due to a substantive error and therefore all counts should be reevaluated. He also asked the court to consider new sentencing rules and new evidence from civil proceedings that has come to light since the original trial. However, Judge Sand said the reversal was on a lesser count of bank fraud and not the bigger conspiracy charge, and he has already rejected a motion to reconsider based on new evidence. He could choose to let the sentences stand since the reversed count was being served concurrently; McMichael asked for both sentences to be reduced to only 12 months. Judge Sand declined to rule immediately, indicating that he would publish a written decision in the coming weeks. But he stated, “There’s no acceptance of any responsibility for what occurred at Adelphia, and I don’t think that’s an overstatement. I think the defendants are in total denial, and that’s very disturbing” (Reuters ).

Exporter Sentenced To 37 Months In Prison In Ex-Im Bank Fraud

Dave Westheimer — Mon, 19 May 2008 06:44:03 +0000

Edward Chua of Montebello, California was sentenced to 37 months in prison on Wednesday by US District Judge Richard W. Roberts in the District of Columbia for defrauding the Export-Import Bank of the US of more than $10 million. Chua, former owner of exporting companies EMMCCO and EMCO, pleaded guilty in July 2007 to one count of conspiracy and one count of mail fraud. Chua admitted acting as a purported exporter in over $10 million worth of fraudulent loan transactions, falsifying documents sent to US banks and to the Ex-Im Bank, and misappropriating approximately $10 million in loan proceeds. He also admitted transferring approximately $9 million to bank accounts owned or controlled by a co-conspirator in the Philippines. The transactions occurred between November 1999 and January 2005 and are part of a larger fraud investigation involving 11 men, 10 of them Filipino nationals, and a total estimated at $80 million. Seven defendants have pleaded guilty to date, and Chua became the fifth to be sentenced to prison. See our entry here on the February sentencing of another defendant, David Villongco (DOJ, Philippines ABS-CBN News).