Teller Admits Embezzling $1M
A former teller at the failed Lynrocten Federal Credit Union pleaded guilty Tuesday to embezzling more than $1 million.
Teresa Wieringo Humphries, 58, of Madison Heights, Va., also admitted participating in fraudulent schemes with at least one other employee, which contributed to the collapse of $13.8 million cooperative in Lynchburg, Va., the U.S. Attorney's Office said.
Humphries admitted stealing $3,000 to $4,000 a month between 2007 and 2013, which she deposited into family members’ accounts, according to court documents. She faces up to 30 years in prison and/or a fine of up to $1 million.
The 1,068-member Lynrocten was liquidated by the NCUA in May 2013 amid rumors of a criminal probe that involved Humphries and two other former Lynrocten staff members: Manager Linda Susan Newcomb and Teller Becky Nichols.
No other criminal charges have been filed yet, but Humphries, Newcomb and Nichols are named as defendants in a $1.7 million civil lawsuit filed by the $20 million Northern Piedmont Federal Credit Union of Culpeper, Va., which accused the three of loan participation fraud.
Law enforcement officials declined to comment about whether other arrests are expected.
During Humphries’ appearance Jan. 7 in federal court, she waived her right to be indicted by a grand jury and pleaded guilty to a one-count criminal information charging her with embezzlement. An information is often filed when a suspect cooperates with prosecutors and intends to plead guilty.
“Ms. Humphries participated in a massive fraud scheme in which she stole over a million dollars from her employer by falsifying loan documents,” United States Attorney Timothy J. Heaphy said in a news release. “Her brazen and persistent acts of fraud violated the trust placed in her by the Lynrocten Credit Union and its customers. This office will continue to vigorously investigate and prosecute instances of financial fraud and do our best to provide restitution to the victims of these crimes.”
According to the release, Humphries and Newcomb carried out several schemes from 2000 until the credit union’s liquidation, including originating fraudulent loans in the names of credit union members and devising a check kiting scheme. Stolen funds from the loan and check writing schemes were funneled to accounts belonging to relatives of Humphries and Newcomb.
Although Humphries admitted to personally stealing about $1 million, the overall loss to the credit union was in excess of $7 million, the release said..
According to the civil lawsuit filed by Northern Piedmont, Newcomb and Humphries concocted a scheme to originate loans, allegedly including the loans in which Northern Piedmont purchased participations, in members’ names without the members’ authorization.
Humphries allegedly confessed in April and May that she and Newcomb had taken loans out in members’ names and deposited the funds in their family members’ accounts for a decade. However, Newcomb denied being involved and Humphries later retracted the statement, according to court records.
Chartered in 1936, Lynrocten served the employees of Rock-Tenn Company, a paperboard, packaging and marketing products manufacturer, their immediate family members, and some select employee groups.