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Federal indictment charges 27 in a check fraud scheme

A federal indictment unsealed Friday named 27 people as part of a check fraud scheme and charged each with bank fraud conspiracy.

Over the course of the seven-year scheme, roughly $1 million was stolen from banks, according to the indictment. Some of the banks were in Mecklenburg, Gaston, Iredell and Cabarrus counties, according to the indictment, which did not list the locations of the other banks.

All but four of the men and women charged are from Charlotte; the others are from Davidson, Whiteville, Clover, S.C., and Chester, S.C. Nearly half have aliases such as “Cash P,” “Juice,” “S-Dub,” “Scrap” and “Kiki,” according to the indictment.

“Combating financial fraud remains priority for my office,” said U.S. Attorney Anne Tompkins. “Fraud schemes like the one perpetrated by the defendants compromise the integrity of our financial system and leave the rest of us to pay for the incurred losses.”

The scheme is believed to have started around December 2007, the indictment alleges. The co-conspirators are accused of using a number of methods to get cash from banks, including using worthless checks and fraudulent ATM cards.

“The co-conspirators obtained checks linked to active bank accounts, either by purchasing or stealing them from the legitimate account holders,” prosecutors said.

Those checks would be deposited into other accounts – usually with very little or no funds available – at a variety of financial institutions, including Bank of America, Wells Fargo, Fifth Third, PNC and SunTrust.

In the time it took the banks to process the check and realize the accounts had insufficient funds, one or more members of the conspiracy would withdraw funds from an ATM or make a cash withdrawal from a bank teller, the indictment alleges. Co-conspirators were also accused of using the ATM cards to buy money orders or other goods and services, then use the “cash back” option at various points of sale.

“By the time banks realized that there were insufficient funds to cover the withdrawals … the conspiracy members had already completed their fraudulent activity,” the indictment said.

Seventeen of the defendants have been arrested, three have agreed to turn themselves in and four are in state custody on state charges. Prosecutors said authorities are looking for three defendants – Elijah Grant, 28, Travis Gabriel, 27, and Demarcus Shankle, 25, all of Charlotte.

The 27 defendants have each been charged with one count of bank fraud conspiracy and face up to 30 years in prison and a $1 million fine. All but one of the defendants were also charged with bank fraud.

Among the other charges some of the defendants face: aggravated identity theft, possession of counterfeit securities, possession of stolen mail, theft of firearms and possession of firearms by a convicted felon.

Trenda: 704-358-5089; Twitter: @htrenda
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