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A North Carolina woman is facing seven felony counts of bank fraud and identity theft in devising a card-cracking scheme in eight states, depositing $740,000 in bad checks that led to a $430,000 loss for Pentagon Federal Credit Union, the U.S. Attorney's Office for the Eastern District of North Carolina in Raleigh said.
Court documents claimed Erica Andrea Monique Johnson, 27, of Fayetteville, N.C., and 12 other defendants initiated the card-cracking scam by depositing bad checks via ATMs or a mobile banking apps after opening primarily PenFed accounts using the identity of unsuspecting members. Right after the deposits were made, Johnson and others made store purchases and cash withdrawals against the deposit credit during the float period before the fraud was detected, prosecutors said.
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The crime ring used ATM/debit cards associated with the PIN numbers for the accounts they accessed and applied for PenFed loans using stolen identities, court documents showed.
USAA Federal Savings Bank also was victimized by the scheme that occurred from March 2018 and ended in June 2020, but federal prosecutors did not say whether the financial institution suffered any losses. Court documents also showed that when the fraudsters deposited the rubber checks, they often used Navy Federal Credit Union ATMs.
What's more, Johnson and the co-conspirators who live in North Carolina traveled to Virginia, Maryland, South Carolina, Georgia, Delaware, New York and New Jersey to carry out the same fraud in order to "slow down" its potential detection, according to court documents.
Johnson, who remains in federal custody, did not enter a plea when she was arraigned on the charges in March at U.S. District Court in Raleigh.
She faces a maximum penalty of 20 years in prison if convicted, prosecutors said.
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Peter Strozniak
Credit Union Times reporter covering credit union operations, fraud, M&As, leagues, business continuity, and breaking news.
