Credit Union Fraud Story Draws National Media Spotlight
A criminal case that victimized the $972 million Wright Patman Congressional Federal Credit Union in Oakton, Va., is receiving widespread national media coverage because the accused fraudster, who worked for Democratic Representative and former chair of the Democratic National Committee Debbie Wasserman Schultz, is also being investigated by the U.S. Capitol police.
A federal investigator alleged that Imran Awan and his wife, Hina Alvi, of Lorton, Va., fraudulently applied for a $165,000 home equity line of credit for a rental property, which was not their primary residence. Because of the higher risk, the credit union’s policy is not to approve HELOCs for rental properties.
What’s more, the $165,000 HELOC funds were wire transferred to Pakistan, a transaction that fraud experts said should have raised big red flags. Awan’s lawyer, however, said there was nothing nefarious behind the wire transfer transaction.
Tony Caccese, interim CEO/CFO for Congressional FCU, said he could not comment about the case and the wire transfer transaction. However, he said that the credit union has an absolute goal and objective of protecting our members’ rights and complying with all aspects of the law, its rules and regulations.
Awan was arrested Monday while he was waiting to board a flight to Pakistan at Dulles International Airport. Federal authorities were concerned Awan would not return to the U.S. even though court records show he purchased a return flight for January 2018. His lawyer, Christopher J. Gowen of Washington, D.C., also said his client informed the House of his plans to visit his family in Pakistan. Nevertheless, Awan was placed on a high intensity supervision program, which means he was required to wear an electronic monitoring device.
Awan had been employed as an IT specialist for House of Representatives, including Democratic House members such as Wasserman Schultz. Awan’s wife, brothers and a friend reportedly did similar IT work for the House. On Tuesday, Awan was fired by Wasserman Schultz.
Awan and his family members have been under investigation by the U.S. Capitol police, which began about six months ago following allegations by unnamed House lawmakers that the Pakistani-Americans were allegedly involved in theft of computers, unauthorized access to computer networks and espionage, according to the New York Times. However, these reports have been mostly published by conservative news outlets, the newspaper reported, which questioned whether the U.S. Capitol police probe was the “stuff of a spy novel, ripe for sleuthing and criminal prosecution or simply an overblown Washington story, typical of midsummer.”
Although Awan has not yet entered a plea on the bank fraud charge, his lawyer said his client intends to plead not guilty during an Aug. 21 hearing at U.S. District Court in Washington, D.C.
A federal investigator said Alvi applied for a HELOC from the credit union on Dec. 12, 2016 for a property on Sprayer Street in Alexandria, Va. However, the investigation also revealed the property had been rented to at least four tenants from June 2015 to June 2017. The Sprayer Street property also had been listed as a rental property on a website, according to court documents.
About two weeks after the HELOC loan was approved on Jan. 5, a Congressional FCU representative called Alvi.
“The person answering the call, who was male, pretended to be Alvi,” the federal investigator wrote in an affidavit. “The male speaking to the representative said that the purpose of the wire was ‘funeral arrangements.’ The CFCU representative then stated that ‘funeral arrangements’ may not be acceptable reason for the wire. The male speaking to the representative then responded that he would look online for an acceptable reason for the wire. After a long pause, the male said the reason for the wire was ‘buying property.’ The representative accepted that reason and initiated the wire transfer for Pakistan.”
Fraud expert Frank McKenna, chief strategy officer for PointPredictive in San Diego, said this conversation should have raised huge red flags.
“The fact that the person was a male pretending to be a female in that conversation is the first red flag,” McKenna said. “Typically in those situations, a representative should address the issue immediately without continuing the conversation further. That was a big miss. Secondly, the fact that the representative allowed the male (pretending to be a female) search for acceptable reasons online to send a wire transfer to Pakistan after they were told the first reason was not acceptable is a huge red flag. That should have been caught.”
As far as the facts laid out in the affidavit, the change in reason for sending the wire certainly seems suspicious and warrants a suspicious activity report, said John J. Byrne, executive vice president of the Association of Certified Anti-Money Laundering Specialists in Miami.
“I would add that as an AML professional, there is no way I would have sent the wire after that change,” he said.
But Awan’s lawyer said there was nothing improper about the wire transfer request.
“There are times where he speaks for her and she speaks for him, that’s pretty common in my marriage too,” Gowen said.
He said Awan’s father died recently, which may be a reason why he mentioned funeral arrangements as a reason for the wire transfer. He also said that his family has been trying to buy an investment property in Pakistan for a while.
“There was nothing nefarious about what he’s been trying to do…..the land deal they’ve been trying to do for years,” he said.