Federal Bank Fraud Cases up in North Alabama

In Birmingham, eight men and women have stood before federal judges  the past few weeks on bank fraud charges.  Among them:

A Mountain Brook man for embezzling nearly $1.2 million from his former employer by writing checks to himself on the company’s bank account.  He was sentenced to four years in prison.

A former Union State Bank branch employee in Trussville who stole $25,000 from the teller drawer and bank vault in 2007 and 2008.  This individual was sentenced to a month in prison for theft.

A former Regions Bank telebanking representative who directed money from a customer’s account to pay for her bills. This individual stole $190,000 from the customer’s account over a two-year period.

The U.S. Attorneys Office for the Northern District of Alabama has seen the number of cases being prosecuted for bank fraud steadily increase in recent years.  In 2011, federal prosecutors charged bank fraud in 22 cases, up from 16 cases in 2010, 15 cases in 2009, and 11 cases in 2008.  So far through May 4 of this year, eight case have been charged.

The director of corporate security for BBVA Compass, Rod Pittman, stated in a written response to questions from the Birmingham News that recently they have “seen a significant increase in fraud attempts, the majority of which can be attributed to the economy and technology.”

“In this economy many people are unemployed and more likely to be in a desperate financial situation.   This sometimes results in attempted fraud,” Pittman wrote.

Peggy Sanford, spokeswoman for the U.S. Attorneys Office in Birmingham said, “The crime of bank fraud is broader than a bank employee stealing money from the bank.  The statute allows that if someone makes misrepresentations to a bank in order to get other people’s money held in that bank, then bank fraud has occurred.”

Banks don’t generally share how much they lose to fraud schemes, but according to some estimates, as an industry it’s in the billions of dollars each year.

The punishment for bank fraud varies.  In the northern Alabama cases, the range of sentences was one month to four years.  A few had longer sentences because they also had other charges besides bank fraud.

Banks have increased security as new fraud schemes surface to tap into accounts.  The chief executive of the Alabama Bankers Association, Dan Bailey, said that bank customers should check their accounts daily to help secure their accounts. “Catch it before it goes too far,” he said.

The original article can be read here.

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