Two Illinois Men Charged in Fraudulent Payment Processing Scheme

A federal grand jury in Chicago returned an indictment charging two Illinois males with financial institution fraud in reference to fee processing firms they operated.

In response to court docket paperwork, Michael D’Ambrose, 62, of Chicago, and Scott Apgar, 43, of Roscoe, operated a bunch of fee processing firms that deposited checks on behalf of merchant-clients. The checks sometimes had been “remotely created checks” (RCCs), which weren’t signed by the account holder whose account was debited.

The indictment alleges that D’Ambrose and Apgar deceived banks in regards to the nature of the fee processing firms’ enterprise and monetary transactions with a purpose to open and keep financial institution accounts and to permit for the processing of tens of tens of millions of {dollars} of RCCs, which had been purportedly licensed by customers.  

D’Ambrose and Apgar allegedly used these financial institution accounts to deposit RCCs on behalf of  service provider shoppers regardless of warning indicators of fraud, together with indications that merchant-clients had been initiating unauthorized debits from the accounts of purported prospects. As alleged within the indictment, the warning indicators of fraud included client complaints and regulation enforcement and financial institution inquiries about unauthorized debits. The indictment additional alleges that D’Ambrose and Apgar deliberately recruited shoppers that had been having issue discovering and protecting fee processing providers elsewhere and, when in search of shoppers, touted their firms’ low requirements for accepting shoppers.

In response to the indictment, D’Ambrose and Apgar fraudulently manipulated the charges of returned deposits related to the fee processing firms’ accounts. They allegedly did so by making small-dollar deposits often called micro-transactions, which elevated the amount of deposits in an account, thereby inflicting the share of returned RCCs to look smaller than it really was. The defendants additionally allegedly submitted to banks paperwork that defendants knew contained false and fraudulent details about the character of the fee processing firms’ operations.

Principal Deputy Assistant Lawyer Common Brian M. Boynton, head of the Justice Division’s Civil Division, U.S. Lawyer John R. Lausch Jr. for the Northern District of Illinois, Appearing Inspector in Cost Kai Pickens of the U.S. Postal Inspection Service Chicago Division and Particular Agent in Cost Kathy A. Enstrom of the Federal Deposit Insurance coverage Company-Workplace of Inspector Common, Chicago Regional Workplace, made the announcement.

The indictment expenses D’Ambrose and Apgar with 16 counts of financial institution fraud. If convicted, the defendants face a most time period of imprisonment of 30 years for every depend of financial institution fraud. A federal district court docket choose will decide any sentence after contemplating the U.S. Sentencing Tips and different statutory elements.

The U.S. Postal Inspection Service and Federal Deposit Insurance coverage Company-Workplace of Inspector Common are investigating the case.

Trial Attorneys Daniel Zytnick and Timothy Finley of the Justice Division’s Client Safety Department and Assistant U.S. Lawyer Edward A. Liva Jr. for the Northern District of Illinois are prosecuting the case.

An indictment is merely an allegation and all defendants are presumed harmless till confirmed responsible past an inexpensive doubt in a court docket of regulation.