$10 Million Business Check Scheme Victimizes Credit Unions & Banks
Alleged fraudsters open CU and bank accounts in the names of sham companies to deposit and launder checks stolen from legitimate businesses.
Eighteen individuals have been charged with orchestrating a $10 million scheme that included depositing stolen business checks into sham company accounts and then withdrawing and laundering the funds at credit unions and banks, according to the U.S. Attorney’s office in Des Moines, Iowa.
Federal prosecutors said last month that a federal grand jury returned an indictment charging members of the alleged fraud ring with bank fraud, money laundering and conspiracy.
The named defendants allegedly first obtained stolen business checks from at least 12 legitimate companies that were allegedly stolen by co-conspirators who were not charged in the indictment.
Members of the fraud ring then registered six sham companies with the IRS and state government agencies in Arizona and Iowa with names that were identical or similar to the legitimate companies that had their names on the stolen business checks, according to the indictment.
Using the names of the sham companies, fraud ring members opened accounts at credit unions and banks to deposit the stolen checks from the legitimate businesses.
When the deposits cleared, defendants withdrew large amounts of cash from the accounts and/or obtained cashier’s or official checks from the accounts and distributed the stolen funds among the members of the fraud ring. Oftentimes, the defendants obtained cashier’s or official checks written to the sham entities that were created for laundering the stolen check funds, according to prosecutors.
The defendants and their co-conspirators attempted to deposit at least $10 million worth of stolen business checks into the fraudulent accounts and managed to cash out at least $2.1 million, the indictment showed.
The victimized credit unions included the $549 million Ascentra Credit Union in Bettendorf, Iowa; the $1.6 billion Collins Community Credit Union in Cedar Rapids, Iowa; the $800 million Community Choice Credit Union in Johnston, Iowa; the $216 million Financial Plus Credit Union in West Des Moines, Iowa; the $640 million Greater Iowa Credit Union in Ames, Iowa; the $10.7 billion GreenState Credit Union in North Liberty, Iowa; and the $7.5 billion Veridian Credit Union in Waterloo, Iowa. The banks that were victimized were BOA, BMO Bank, First Central State Bank Great Southern Bank, JPMorgan Chase bank, PNC Bank and U.S. Bank.
Most of the defendants live in Iowa, Illinois or Indiana and two of them live in Arizona.
The defendants named in the indictment were Thaddeus Jerome Lee, Johnnie Lee Thomas, Malik K. Marshall, Latroy L. Currie, Tiarra Lenae Jones, Stephan Rashad Haley, Lovely Hall, Kira Ashleigh Johnson, Carnell A. Thomas Jr., Reanna R. Haymon, Somore Renee Hill, Shapara Monee Hunter, Toni Lynette Renfroe, Erin R. Smith, Mario Ricardo Smith, Jazlinn Chaute Tapp, John Ivory Winston Jr. and Kila R. Wright.
Read More: Grand Jury Indictment