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Financial Institution Fraud-Criminal Case In South Florida Involving Attorney

A 55-year-old Lake Worth attorney, who turned himself into the FBI in June after spending roughly three months on the lam, has apparently reached a tentative plea deal with federal prosecutors for allegedly taking at least $7.2 million from clients.

Appearing in court this morning, Timothy McCabe pleaded not guilty to five counts of fraud on a financial institution. He also waived indictment on the charges. In federal court, that typically signals that a plea deal is in the works. He remains in jail without bond.

“He took the money and ran,” said Nancy Buchanan, a 70-year-old Lake Worth resident, who said she lost about $76,000 to McCabe. “He either spent it or stashed it.”

She said she came to court today just to see the tall, heavy set man who violated her trust. “I want him to know he’s hurt people,” she said. “I want him to see my face in court.” Source

Criminal Investigations

The United States Secret Service is responsible for maintaining the integrity of the nation’s financial infrastructure and payment systems. As a part of this mission, the Secret Service constantly implements and evaluates prevention and response measures to guard against electronic crimes as well as other computer related fraud. The Secret Service derives its authority to investigate specified criminal violations from Title 18 of the United States Code, Section 3056.

Financial Crimes

The Secret Service exercises broad investigative jurisdiction over a variety of financial crimes. As the original guardian of the nation’s financial payment systems, the Secret Service has a long history of protecting American consumers and industries from financial fraud. In addition to its original mandate of combating the counterfeiting of U.S. currency, the passage of federal laws in 1982 and 1984 gave the Secret Service primary authority for the investigation of access device fraud, including credit and debit card fraud, and parallel authority with other federal law enforcement agencies in identity crime cases. The Secret Service also was given primary authority for the investigation of fraud as it relates to computers.

In the early 1990s, the Secret Service’s investigative mission expanded to include concurrent jurisdiction with the United States Department of Justice regarding Financial Institution Fraud. Also during this time, the Internet and use of personal computers became commonplace and expanded worldwide. The combination of the information revolution and the effects of globalization caused the investigative mission of the Secret Service to expand dramatically. As a result, the Secret Service has evolved into an agency that is recognized worldwide for its investigative expertise and for its aggressive and innovative approach to the detection, investigation and prevention of financial crimes.

Money Laundering

The Money Laundering Control Act makes it a crime to launder proceeds of certain criminal offenses, called “specified unlawful activities,” which are defined in Title 18, United States Code, Sections 1956 & 1957; as well as Title 18, United States Code, Section 1961 (Racketeer Influenced and Corrupt Organizations Act). The Secret Service monitors money laundering activities through other financial crimes such as financial institution fraud, access device fraud, food stamp fraud and counterfeiting of U.S. currency. Source

Money laundering is a felony, which may be charged in state or federal court. The penalties include jail time, a fine, and the forfeiture of any cash seized by the government. If the cash from an illegal enterprise is deposited in a bank account that contains other funds, the entire bank account could be seized.

Money laundering, or “smurffing” as it is otherwise known, occurs when you conceal the use of funds or money that came from an illegal enterprise.

Examples of Financial Institution Fraud Investigations – Fiscal Year 2013

The following examples of financial institution fraud investigations are written from public record documents on file in the court records in the judicial district in which the cases were prosecuted.

Man Sentenced for Bank Fraud and Money Laundering

On July 19, 2013, in Milwaukee, Wis., James Scalzo, of Kenosha, Wis., was sentenced to 35 months in prison, three years of supervised release and ordered to pay $200 in special assessments. Restitution will be determined at a later date. Scalzo pleaded guilty in January 2013 to bank fraud and money laundering. According to court documents, between April 1, 2008 and October 31, 2009, while employed as a bank officer at a bank in Burlington, Wis., and then at a Credit Union in Round Lake Beach, Ill., Scalzo originated and approved multiple fraudulent loans. He then directed funds to be taken from the loans and transferred by cashier’s check or wire, to personal accounts. Some of the loan funds were applied against earlier loans in order to conceal the fraud. The scheme involved more than $1.4 million in loan funds.

Six Individuals Sentenced for their Roles in Large, Multi-State Identity Theft Ring

On July 18, 2013, in St. Paul, Minn., Joel Delano Powell III, of Minneapolis, was sentenced to 42 months in prison and Trey Jeremiah Powell, of Brooklyn Park, was sentenced to 57 months in prison. Both had earlier pleaded guilty to one count of conspiracy to commit bank fraud and one count of aggravated identity theft. Earlier this week, Joel Delano Powell, Jr., of St. Louis Park, was sentenced to 300 months in prison. Powell, Jr. was convicted following a jury trial in August and September 2012 of one count of conspiracy to commit bank fraud, seven counts of aiding and abetting bank fraud, and five counts of aggravated identity theft. On July 17, 2013, Elston Edwards Sharps, of Minneapolis, was sentenced to 32 months in prison; Kevin Terrell Martin, of St. Paul, was sentenced to 124 months in prison; and Steven Lavell Maxwell, of Minneapolis, was sentenced to 140 months in prison. All three pleaded guilty to one count of conspiracy to commit bank fraud and one count of aggravated identity theft. These individuals, along with over 100 others, were involved in a conspiracy from 2006 through December 2011 to defraud banks, bank customers, and businesses. The co-conspirators used victim information to create counterfeit checks and false identification documents to conduct fraudulent transactions at retail establishments where expensive merchandise was purchased and returned for cash. At banks, the conspirators posed as customers and withdrew money from victims’ bank accounts. The members of the conspiracy conducted these fraudulent transactions throughout Minnesota and in at least 13 other states. Victim information was obtained by members of the conspiracy through multiple sources, including from individuals who stole victim information from their places of employment, from individuals employed at area banks, from those who stole the information from the mail, during vehicle break-ins, and business burglaries, among other sources.

Ohio Man Sentenced for Bank Fraud and Money Laundering

On July 10, 2013, in Cleveland, Ohio, Aziz Ukshini, of Westlake, Ohio, was sentenced to 42 months in prison and three years of supervised release for bank fraud and money laundering. Ukshini was also ordered to pay a $400 special assessment and to pay $3,303,817 in restitution jointly with Anthony Raguz to the National Credit Union Administration. According to court documents, from September 2003 through March 2010, Ukshini, aided and abetted by Raguz, the former Chief Operating Officer of St. Paul Croatian Federal Credit Union, fraudulently obtained numerous loans totaling approximately $2.8 million from the credit union. Ukshini obtained these loans by making false representations and promises. He received the loans after having already defaulted on previous loans issued to him by the credit union. These loans were obtained in the names Aziz Ukshini; Hard Rock Crushing, Ltd.; and Azmet, Inc. Ukshini gave Raguz about $90,000 for approving and facilitating the approval of his fraudulent loans. Raguz was sentenced to 168 months in prison in November 2012. Source

West Palm Beach Fraud and Money Laundering Defense Attorney

Depending upon the amount taken, fraud charges can have very serious consequences in Florida:

  1. Theft of $300 to $20,000 by fraud is a third-degree felony, punishable by up to five years in jail and a $5,000 fine
  2. Theft of $20,000 to $100,000 by fraud is a second-degree felony, punishable up to 15 years in jail and a $10,000 fine.
  3. Theft of more than $100,000 by fraud is a first-degree felony, punishable by up to 30 years and a $10,000 fine.

At the law firm of Andrew D. Stine, P.A., in West Palm Beach, we have extensive experience representing people charged with fraud crimes, including mortgage fraud, mail fraud, wire fraud, securities fraud, tax evasion, insider trading, theft by fraudulent means, writing bad checks, and organized schemes to defraud.

In Florida, most fraud changes involve the Economic Crimes Division (ECD) putting together a great amount of evidence for presentation before a grand jury. The best way to resolve these cases is for your lawyer to have a good working relationship with the prosecutor and to try to avoid any serious consequences by paying restitution. In Florida, restitution outweighs incarceration, so if your lawyer can persuade the victim to drop charges in favor of receiving their money back, you can usually avoid a conviction.

If you did not commit the fraud crime, we can prepare an aggressive defense and force the state to prove its case. In many cases, that can be a difficult thing for the state to do.

Free consultation 24/7: Call West Palm Beach criminal defense lawyer Andrew D. Stine, P.A. at 561.880.4300. Se habla español.

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