Woman Sentenced in $1 Million Loan Scheme That Victimized Credit Unions & Banks

A North Carolina woman, who played a central role in a $1 million loan scheme that victimized credit unions, banks and a disabled veteran struggling to save his family’s business, will spend the next four years and nine months in federal prison, said Andrew Murray, U.S. Attorney for the Western District of North Carolina in Charlotte.

U.S. District Judge Robert J. Conrad Jr. on Jan 30 also ordered Kimberlie L. Flemings, 51, of Mount Holly to pay more than $600,000 in restitution to eight credit unions and three banks.

In October 2018, a federal jury convicted Flemings of conspiracy to commit wire and bank fraud, wire fraud affecting financial institutions, and multiple counts of financial institution fraud.

Her co-conspirators, Stanley Reginald Barron and Brian Lyles, were previously sentenced to 18 months and 15 months in prison, respectively, for their involvement in the scheme.

Flemings, however, filed a notice last week to appeal her sentence, according to court records.

Flemings, Barron, Lyles and others submitted dozens of fraudulent automobile and personal loan applications in their own names, as well as the names of more than 30 other individuals to credit unions and banks from 2012 to 2015.

In addition to duping the elderly and disabled veteran into providing his personal information so that Flemings could use it to apply for a loan, she also used the identity of a deceased man to apply for at least four other loans, according to federal prosecutors.

The three-person fraud ring created fake automobile dealerships that purported to be the sellers of vehicles purchased with the fraudulent loans.

They also set up bank accounts, websites and addresses associated with those bogus automobile dealerships, and created fictitious purchase orders, which were submitted to the credit unions and banks as part of the loan application. The co-conspirators obtained more than $1 million in loans.

Flemings, Barron and Lyles deposited the checks from the credit unions and banks into accounts Barron controlled. After keeping a portion of the proceeds, he distributed the rest to Flemings, Lyles and others.

According to court records, the majority of the loans defaulted. When credit unions and banks attempted to collect on the debts, the co-conspirators falsely said that the borrowers had been the victims of identity theft and that they had not authorized the loans,

Flemings was ordered to pay restitution to the $111 billion Navy Federal in Vienna, Va.; the $24.7 billion PenFed in Tysons Corner, Va.; the $3.1 billion NASA FCU in Washington, D.C.; the $425 million McGraw-Hill FCU in East Windsor, N.J., which was merged into PenFed in 2019; the $9.3 billion Digital FCU in Marlborough, Mass.; the $345 million Credit Union of New Jersey in Ewing; the $376 million Garden Savings FCU in Parsippany, N.J. and the $3.5 billion Affinity FCU in Basking Ridge, N.J.

The defrauded banks were Wells Fargo Bank in Sioux Falls, S.D., Sun Trust Bank in Atlanta, Ga. and Santander Bank in Boston.