Michael Ross Franco, a former loan officer at My Community Federal Credit Union, was arrested and pled guilty this week to defrauding the cooperative out of more than $4 million in an auto loan kickback scam.
According to the U.S. Federal District Court in Midland, Texas, Franco worked as a loan officer at the $255 million My Community, also in Midland, from May 22, 2006, through Oct. 22, 2008.
During that period, he approved nearly 487 fraudulent loans for a car dealership that was named in information from the court.
Working with the general sales manager and operator of the dealership, Franco was able to approve loans without verifying loan documents, according to the court. Some loans were also approved before applications were received.
In addition to overstating or misstating a customer's income, Franco included false statements on the customer's debt-to-income ratio, credit score and the value of the vehicle purchased, according to the district court document.
In exchange for the approved loans, Franco received more than more than $29,000 in kickback payments.
Franco pled guilty Tuesday to conspiracy to commit bank fraud. He is now facing a federal prison sentence of up to 30 years, a $1 million fine and restitution to My Community and up to five years of supervised release upon completion of his prison sentence.
A comment from My Community was not immediately available. However, the credit union did release a statement to local media saying, “The incident occurred over [three] years ago and is currently being investigated by the Midland FBI and the U.S. Attorney's Office. The Credit Union was and is Federally Insured and Bonded and continues to be a financially strong institution.”
Complete your profile to continue reading and get FREE access to CUTimes.com, part of your ALM digital membership.
Your access to unlimited CUTimes.com content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking credit union news and analysis, on-site and via our newsletters and custom alerts
- Weekly Shared Accounts podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the commercial real estate and financial advisory markets on our other ALM sites, GlobeSt.com and ThinkAdvisor.com
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
