Construction director among six indicted for $8m fraud

A man who looked after construction for a Pennsylvanian bank is among five men and one woman indicted for stealing more than $8m from an insurance company and a bank in the state.

The group, say prosecutors, colluded in a scheme to get money from the bank and insurance firm for work and materials never delivered.

The cases follow a two-year investigation by the US Postal Inspection Service, with assistance from the FBI and the IRS.

John L Williams, 49, the bank’s regional construction director, is accused of fraud, embezzlement and money laundering.

According to prosecutors, Williams was employed as a project manager in the bank’s Indianapolis office. His responsibilities included overseeing the bank’s own new-build and renovation projects in Wisconsin, Illinois, Michigan, Kentucky and Indiana.

The indictment says Williams told subcontractors and suppliers to submit invoices for work that was never performed and for materials that were never supplied, and that Williams approved their payment.

Once paid, the co-conspirators would give a large percentage to a fictitious business entity controlled by Williams, called CB Consulting, with the money often passing through multiple bank accounts before reaching its destination, say prosecutors.

The other five accused are Ernie Perkins, 36, owner of Remarkable Creative Enterprises; Robert Finch, 71, Indianapolis, owner of Finch Constructors; Donald Landis, 58, owner of P&L Supply; Walter Watson, 69, owner of the W-3 construction company; and Shalonda Coleman, 42, Indianapolis, a former employee of the insurance company.

Each defendant faces a maximum of 30 years in prison if found guilty.

Coleman and Perkins are also charged with using the US Mail to defraud a Pennsylvania-based insurance company. In those instances, Coleman used her position as a claims processor, and her access to the company’s computer systems, to cause the insurance company to mail cheques to Remarkable Creative Enterprises. Coleman disguised the payments by describing them as work performed for the company’s insurance clients.

The charges were filed by Josh Minkler, a US attorney for Indianapolis. He said: "This community has a right to hold high expectations of individuals in positions of trust in our financial institutions. Those who blatantly commit fraud and abuse their positions will be held accountable in federal court."

Image: US attorney for Indiana Josh Minkler (YouTube)

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  1. Who can shareholders/pubic trust? Long overdue when White Collar Criminals like Directors of companies are sentenced with prison terms and hopefully do go to jail and not released on appeal.

  2. Will be interesting to see if this was a simple case of systems that allowed a single individual to hold the three main procurement responsibilities – Select/order – Budget Responsibility – Receipt/Pay. If so it was a poorly set up process, and the head of procurement/control should have to answer too – this is a commonly known issue.

    Requiring “4-eyes” to be involved is, I thought, the default risk-reduction method in most organisations today.

    If they were more sophisticated, it would be good to share the learning so loopholes can be closed.

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