The loss prevention department at the $2.6 billion Redwood Credit Union in Santa Rosa, Calif. helped lead police to the arrest of a Chicago man who was running a check fraud scheme on Facebook.

On July 31, Santa Rosa detectives arrested Ahmad Rashad Carter, 20, of Chicago, and charged him with fraud, grand theft, conspiracy to commit fraud and using a computer system to commit financial crimes.

Carter was arraigned in Sonoma County Court in Santa Rosa Tuesday, but he did not enter a plea. He remains in custody on a $50,000 bond.

Police said they found evidence that Carter had conspired with a group of suspects in other parts of the country to operate the social media check scam that victimized at least five Redwood CU members who lost nearly $60,000.

“We believe that there are many other victims out there that have not been reported,” Sergeant Josh Ludtke of the Santa Rosa Police Department said. “We are working to identify those people.”

After Carter was arrested, police found additional information about other people who may have been victimized by the check fraud.

However, Mishel Kaufman, Redwood CU's senior vice president of risk management, said the credit union is not aware of other members who were affected.

“The good news is Redwood CU was able to identify the fraudulent activity quickly and immediately engage law enforcement to actively pursue and arrest the suspect before more members were impacted by the scam,” Kaufman said. “To our knowledge, no additional members have been impacted. The case is still under investigation and law enforcement has indicated they have reason to believe many customers of other financial institutions have been impacted, but we cannot speak to what other institutions are seeing.”

With information from Redwood CU and the Sonoma County Sheriff, Santa Rosa detectives determined Carter would befriend members on Facebook.

According to police, the Redwood members were tricked into providing their personal account information to Carter and other suspects.

After building some confidence with them, Carter would tell members he had a quick way for them to make money if they would deposit checks into their accounts.

Carter or other suspects would talk members into providing their personal login information and other account credentials, according to police. Using mobile deposit, Carter would deposit checks into members' accounts.

Within three to five days after depositing the checks, Carter instructed members to withdraw money he deposited and take 10% of that total for themselves for allowing him to use their credit union accounts.

Once the money was withdrawn, Carter provided members with his account number at another financial institution and had members deposit those funds into that account via electronic transfers.

Within a couple of days after those funds were deposited into Carter's account, the credit union determined Carter's checks were fraudulent, police reported.

Although several of the deposits were made through electronic transfers, police found out at least one member met with the suspects in person to deliver the cash.

This led police to coordinate an undercover operation in which a detective posed as a member to deliver the money to Carter. After he showed up at the predesignated location, Carter was arrested.

Kaufman noted Redwood CU continuously works to educate members to never share their financial passwords or account information, and to only do business with people they trust.

Santa Rosa police said there are numerous types of scams occurring nationally involving fraudulent check deposits that are initiated via phone or social media and require funds to be sent through Western Union, Money Grams or electronic bank transfers. Sometimes these funds are delivered in person.

Instant Insights /

Credit Union Uncovers Facebook Fraud Scheme

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