Six small and large New York credit unions and their members were victimized in a $100,000 social media check fraud scheme.
New York Attorney General Eric T. Schneideman filed a 19-count indictment July 29 against Kevin Lee and Daniel Green for writing fraudulent checks in the name of a bogus business to deceive credit union members. The state's prosecutor said Lee and Green were the ringleaders in this fake check scam and an investigation is continuing in at least eight counties including Westchester, Rensselaer, Albany, Schenectady, Saratoga, Oneida, Broome and Oswego.
The credit unions targeted were the $242 million G.P.O. Federal Credit Union in New Hartford, the $815 million Summit Federal Credit Union in Rochester, the $1.3 billion Capital Communications Federal Credit Union in Albany, the Syracuse-based $40 million Money Federal Credit Union, the $1.5 billion Empower Federal Credit Union in Syracuse and the $176 million SECNY Federal Credit Union.
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Prosecutors said Lee created phony bank accounts in the name of Jones Maintenance, a fictitious business in which Lee claimed to have an interest.
Lee and Green used Facebook and other social media sites to target what prosecutors described as financially vulnerable individuals — college students, young single parents and other indigent, disadvantaged and unwary young adults – to whom they issued forged checks in the name of fake company.
In exchange for depositing these forged checks in their accounts, credit union members were promised a portion of the check as a fee.
After the checks were deposited and the funds cleared and became available, Lee and Green allegedly withdrew the money for their own personal use. In some instances, they assumed the identities of members, accessing their accounts and withdrawing funds through ATM transactions using personal information of the accountholders.
From December 2015 to May 2016, Lee and Green allegedly issued more than $100,000 in fraudulent checks.
Lee, 26, of Clay, and Green, 20, of Syracuse, were arraigned last week in Onondaga County Court.
They were charged with grand larceny, forgery and identity theft, among other charges. If convicted, Lee and Green could be sentenced to 10 to 20 years in state prison.
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Peter Strozniak
Credit Union Times reporter covering credit union operations, fraud, M&As, leagues, business continuity, and breaking news.
