Internal Fraud Cases Hit Navy Federal Credit Union

Navy Federal Credit Union and Cybercrime Support Network formed a new partnership to protect members from outside cybercriminals, including those who pretend to be Navy Federal employees to get access to members’ accounts to steal money.

But the nation’s largest credit union recently had two cases in which actual Navy Federal employees stole members’ funds.

The first case involved two former Florida-based Navy Federal employees who allegedly worked together to steal an estimated $75,195 to $99,381 and attempted to steal an estimated $122,000 to $165,650 after taking screen shots of member accounts. The second case involved a Virginia woman who stole more than $7,000 from Navy Federal members after getting account information from a former Navy Federal fraud investigator who became a police informant. She later attempted to hire a hit man to murder the fraud investigator, a police officer and her ex-husband.

“Navy Federal takes allegations of fraud seriously. We’re cooperating with the authorities to bring resolution to these cases, and to ensure that any members who may have been impacted are made whole,” a Navy Federal spokesperson said.

Four felony charges have been made against Stephon Q. Pugh Davis, 27, of Pensacola, Fla., a former Navy Federal customer service representative, and Tiwaun Jamer Williams, 27, also of Pensacola, a former Navy Federal mailroom employee.

A Navy Federal Global Security investigator contacted the Florida Department of Law Enforcement (FDLE) for Escambia County last June concerning suspected internal fraud.

According to an FDLE affidavit and arrest warrant, another Navy Federal employee reported to the Navy Federal fraud investigator that she was allegedly being recruited by Williams to provide member account information in exchange for money.

The credit union’s fraud investigator interviewed Williams who admitted to the alleged scheme. After retrieving Williams’ Navy Federal-issued mobile device, Florida investigators discovered many screenshots of members’ account information.

According to Florida investigators, Pugh-Davis, as a customer service representative, had access to member account information. He allegedly took screen shots of member accounts and sent them to Williams. Soon after he received the screen shots, Williams called the Navy Federal contact center and pretended to be the holder of an account and transferred funds from that account to another member account, which was owned by a “money mule” associated with Williams, according to investigators.

After the money was transferred out of the victim’s account, the funds were often times immediately transferred out of the money mule’s account into mobile payment platforms, according to FDLE investigators.

An estimated 22 to 32 Navy Federal member accounts were compromised.

Williams has pleaded not guilty to the charges and Pugh-Davis has not entered a plea, according to court records. Both men are expected to appear for a court hearing in June.

In March, Cassie Crisano pleaded guilty to nine felony counts of fraud, theft and receiving stolen credit card information stemming from allegations made by Terry Linton, a former Navy Federal fraud investigator.

She was originally charged with 20 felony counts in February 2018, according to court documents.

But in 2017, Linton was arrested for trying to solicit sexual favors via his computer from what he believed to be an underage girl who turned out to be an undercover police officer, Virginia Prosecutor George Elsasser said.

Hoping to lessen his legal problems, Linton told police that he gave Crisano Navy Federal member account information, which she used to make more than $7,000 worth of fraudulent purchases. Elsasser, however, believes she stole more than that amount.

When police searched Crisano’s home, they found evidence related to the Navy Federal theft including photo IDs that had other women’s names and Crisano’s picture. Those women were Navy Federal members whose personal information had been compromised by Linton.

After becoming aware that the former Navy Federal fraud investigator was cooperating with police, she attempted to hire a hitman to kill him, her husband and another police officer. The hitman she attempted to hire turned out to be another undercover police detective.

For these crimes, Crisano, 41, was sentenced to 81 years in prison in 2019.

But it wasn’t until last March when she was sentenced to an additional four years in prison for her crimes involving the Navy Federal insider fraud case. Crisano, who also was a former police officer for the Prince George’s County Police in Maryland, was ordered to pay $7,061 in restitution to Navy Federal.

Linton pleaded guilty to his charge and was sentenced in 2018 to 10 years in prison of which nine years and eight months had been suspended, Virginia court records showed.