Former Credit Union Employee Sentenced in $2 Million Wire Fraud Scheme

For taking more than $100,000 in cash kickbacks during a six-month $2 million wire fraud scheme, former credit union ACH coordinator Jose A. Prado-Valero will spend the next 33 months in a federal prison.

Sentenced by U.S. District Court Judge Tanya Walton Pratt in Indianapolis last month, the 35-year-old Prado-Valero of Carmel, Ind., was also ordered to pay $2,132,517 in restitution and two years of supervised release following his prison term.

Last December he pleaded guilty to one felony count of financial institution fraud, according to court documents.

“The wire fraud scheme perpetuated by Prado-Valero was not a momentary inability to resist temptation, but rather was a carefully executed systematic theft,” prosecutors wrote in their sentencing memo to Judge Pratt.

Prado-Valero worked at the $873 million Financial Center First Credit Union (FCFCU) in Indianapolis from 2016 to 2019 as an automated clearing house coordinator. His responsibilities included overseeing transactions in and out of accounts belonging to the credit union’s 66,335 members. He also had access to their account and personal information.

Sometime before February 2019, Padro-Valero was approached by co-conspirators looking to launch a plan to defraud FCFCU and steal money from member accounts.

The co-conspirators, who were not identified in court documents and were not credit union employees, promised to pay Padro-Valero kickbacks for his participation in the scheme.

He agreed to access member account information prior to providing personally identifying information to his co-conspirators to ensure that there were sufficient funds in the targeted accounts to support the fraudulent transfers.

“Prado-Valero discovered that the execution of his scheme was easy to accomplish as his accomplices perpetrated their portion of the scheme remotely and because he was paid kickbacks in cash,” prosecutors said. “Further, many of the victim members were not aware of the unauthorized withdrawals from their account for some time after they occurred.”

From Feb. 14 to Aug. 16, 2019, Prado-Valero and his co-conspirators transacted 34 fraudulent ACH transfers to themselves out of FCFCU member accounts, and Prado-Valero received more than $100,000 in cash kickbacks.

Court documents did not indicate how many co-conspirators were involved in the scheme or whether they have been arrested and charged.

FCFCU did not respond to CU Times for a request for comment.