A former Wells Fargo bank manager in Glendale, CA who was facing allegations that he unfroze suspicious accounts in connection with a $14 million identify theft scheme to defraud the Internal Revenue Service has pleaded guilty to the federal criminal charges.
News reports about the case said the defendant, Hakop Zakaryan, 34, admitted to aiding in the felony bank fraud case as part his plea agreement with federal prosecutors.
He was charged along with other defendants in connection with an unlawful operation involving thousands of false claims using stolen identities.
This information came from a statement from the United States Attorney's Office.
The defendant was accused of lying to the bank's loss prevention department to give clients fraudulent access to the accounts which were flagged due to suspicious activity. He faces a maximum sentence of 30 years in a federal prison.
Our California criminal defense lawyers provide an overview of federal bank fraud charges below.
What is Federal Bank Fraud Under 18 U.S.C. 1344?
Bank fraud is a crime defined as when someone knowingly executes, or attempts to execute a scheme to defraud a financial institution, or obtain property owned a financial institution, by means of fraudulent pretenses, representations, or promises.
Bank fraud cases can range from the infamous theft or embezzlement of money by a bank employee to a much more complicated scheme to defraud a financial institution based upon false statements, such as false loan applications and misuse of money.
Since the rise of online banking, internet bank fraud has become more common. 18 U.S.C. Section 1344 is the statute that criminalizes defrauding a bank or committing a scheme to defraud involving accounts of a financial institution.
Under 18 U.S.C. 1344 provides punishment for anyone who knowingly executes a scheme, or attempts to execute, a scheme or artifice:
- To defraud any financial institution
- To obtain money, funds, securities, or other property owned by a financial institution by using false pretenses or promises.
Additionally, 18 U.S.C. Section 1014 makes it a federal crime to make false statements to a financial institution. If you are convicted of bank fraud, you could face up to 30 years in federal prison, a fine up to $1,000,000, or both.
The financial institutions covered by 18 U.S.C. 1344 are those that are federally insured, such as by the Federal Deposit Insurance Corporation (FDIC). This includes all major banks and most bank related entities.
How Does the Prosecutor Prove Federal Bank Fraud?
In order for a federal prosecutor to convict you of federal bank fraud under 18 USC 1344, they have to be able to prove - beyond a reasonable doubt – certain elements of the crime that:
- You executed, or attempted to execute a scheme that was charged in the indictment that you defrauded a financial institution to obtain their money by using false or fraudulent pretenses
- You knowingly and willfully participated in this fraudulent scheme with specific intent to defraud in order to obtain money by means of false or fraudulent pretenses
- The financial institution in question was federally insured, a federal reserve bank, or a Federal Reserve System member
What are the Possible Defenses to Federal Bank Fraud?
The crime of Bank Fraud under 18 U.S.C. § 1344 is an enhanced legal penalty for fraud committed against a certain classification of victims, like in this case a financial institution.
Therefore, the defenses that can be used by your federal criminal defense lawyer for bank fraud charges will be similar to the defenses used for most fraud crime allegations.
Typically, in order to prove a fraud, the federal prosecutor must establish that you made a knowingly false statement - and you intended them to rely on the statement - and they did in fact, rely on your statement that caused them to suffer a financial loss.
Each step in the defense process could be challenged for insufficient evidence.
That said, an experienced federal criminal defense can use a variety of legal defenses on your behalf against federal bank fraud charges in violation of 18 U.S.C. § 1344. These include:
- It might be possible to prove you didn't know the statement made to the financial institution was false. Alternatively, it might be possible to show financial institution knew from the beginning your statement was false, and didn't rely on it. In some bank fraud cases, the false statement is actually believed and relied upon, but the financial institution did not suffer a financial loss as a result.
- We might be able to show you didn't participate in a scheme to defraud the financial institution. If you weren't involved in the scheme or the incident didn't involve obtaining money from the financial institution, but rather a member of the bank or other connection, you shouldn't be convicted of federal bank fraud. In such a case however, you might be convicted of other federal crimes.
- The financial institution in question did not face a real threat of potential loss. It should be noted that it's not required that the financial institution suffered an actual financial loss. However, if our defense lawyers can show the financial institution was never facing a potential loss, in spite of how the fraudulent scheme occurred, you should be able to avoid a bank fraud conviction.
It's important to note that each federal bank fraud case is fact-specific and depend on particular circumstances. This means the best defense strategy to use on your bank fraud case depends on a thorough examination of the prosecutor's evidence.
If you or a family member is under investigation or already indicted for bank fraud under 18 U.S.C. § 1344, call our experienced federal crime defense attorneys to review your case.
We will protect your rights and work to obtain the best possible outcome in your case. Call us at (877) 781-1570.
Eisner Gorin LLP 1875 Century Park E #705 Los Angeles, CA 90067 310-328-3776