A man and woman who were part of a California fraud ring used fake credit cards and conspired with another person feigning as a customer service representative to steal thousands in cash advances from credit unions and banks in nine states.

Michael Lee Thomas, 46, of Oakland (pictured at left) and Barbara John Lopp, 53, of Stockton, pleaded not guilty to conspiracy to commit bank fraud last month in U.S. District Court in Oakland.

Although the FBI began investigating the fraud ring in June 2013, it wasn't until Feb. 12, 2015, when the couple was arrested at a branch of the $15.9 million Municipal Credit Union in Sioux City, Iowa, where their cash advance scheme drew suspicion from employees who contact police.

Iowa prosecutors charged the California couple with several felony counts of credit card fraud, forgery and identity theft, but those charges were dismissed after the federal indictment was filed on July 16.

Iowa police investigators said Thomas and Lopp hit more than 100 financial institutions in Iowa alone over three weeks. Because it was suspected that the duo might have carried out their scheme in at least three other states, law enforcement authorities posted a nationwide bulletin to alert financial institutions.

However, court documents revealed that Thomas and Lopp were also operating their cash advance scheme in eight other states: New Hampshire, Massachusetts, Florida, New York, New Jersey, Michigan, Oklahoma and Kansas.

After flying to a state, they would rent a car and drive to several financial institutions over the course of a few days. On some of these trips, the California couple would score $40,000 or more after hitting four or more financial institutions.

Thomas and Lopp would take turns going into the branch and sometimes told tellers the cash advance was needed to pay for a relative's funeral expenses. In addition to the fake credit cards, they also used bogus IDs.

When tellers processed the cash advance request, it would be declined. Thomas or Lopp would then say there might be a block because they were traveling outside of their normal geographic area and ask the teller to call the credit card company, according to court documents.

However, the toll-free number on the fake credit card also was fake, and the person who answered that number was working with Thomas and Lopp, according to court documents.

The individual pretending to be a customer service representative verbally authorized the cash advance and gave the teller a series of instructions, leading the credit union or bank to manually post the transaction to the fraudulent credit card, which is sometimes called a forced post transaction.

This fraudulent transaction is often not discovered, however, until a chargeback notice is later received by the financial institution, according to federal investigators.

Although court papers do not say how many financial institutions the California duo hit and the total amount of money they stole over their 20-month scheme, several credit unions and a bank are mentioned as examples.

On June 27, 2013, Thomas and Lopp (pictured at left) fraudulently obtained $24,000 in cash advances from three different branches in Massachusetts and New Hampshire of the $6.4 billion Digital Federal Credit Union in Marlborough, Mass.

Two months later on Aug. 20, 2013, Lopp walked into a branch of the $555 million Gulf Winds Federal Credit Union of Pensacola, Fla. and fraudulently secured an $8,000 cash advance, according to court documents.

On Sept. 5, 2014, Lopp fraudulently obtained $19,650 in cash advances from two Kansas branches of the $282 million Great Plains Federal Credit Union of Joplin, Mo.

And on Nov. 12, 2014, Thomas fraudulently obtained $19,700 from two branches of the $102 million Focus Federal Credit Union in Oklahoma City, Okla.

According to court documents, Thomas and Lopp also fraudulently stole a total of $39,500 in credit card cash advances from Chase Bank locations in Michigan, New York and New Jersey.

Digital FCU declined to comment about this case when reached Wednesday because of the ongoing litigation. The other credit unions mentioned in court documents did not respond to CU Times' request for comment.

If convicted, Thomas and Lopp could face up to 30 years in prison.

Instant Insights /

California Duo Face Bank Fraud Charges

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