Fraud Friday – President of a Bank Subsidiary and Four Others Enter Plea Deals for $13.2 Million Fraud
November 5, 2021
Delaney Sexton
Contributing Editor
Fraud Friday – President of a Bank Subsidiary and Four Others Enter Plea Deals for $13.2 Million Fraud
Five defendants, including the president of a bank subsidiary, were indicted in November of 2020 for a Ponzi-like scheme to defraud multiple financial institutions in San Antonio, Texas. Ronald Schroeder, Jill Alvarado, Phyllis Martinez, Rigo Alvarado, and Ryan Martinez had from one to six charges each. The charges include one count of conspiracy to commit bank fraud, one count of conspiracy to commit money laundering, one count of conspiracy to launder monetary instruments, and three counts of bank fraud.
The group defrauded financial institutions through factoring, when a company sells accounts receivable to a third party at a discounted price to accelerate cash flow, false and fraudulent invoices. Ronald Schroeder, the former president of Texas Express Funding LLC, a subsidiary of the Bank of San Antonio, would send false invoices from companies owned or controlled by the other defendants to be factored by the financial institutions. This money would be utilized for personal gain or to pay off old invoices owed to the financial institutions.
A company owned by Ryan Martinez and later Phyllis Martinez known as Nerd Factory would send the fraudulent invoices to Southwest Bank to be factored. It would then go to the Bank of San Antonio to be factored. Nerd Factory and Alvy’s Logistics, a company owned by Jill and Rigo Alvarado, would kick back some of the money they obtained from the scheme to Schroeder.
Ronald, on the other hand, did not have a legitimate company. He instead created a fake company called Republic Logistics to steal money for himself. Using the same scheme, he started the fraud at Southwest Bank and grew the portfolio until he could sell it to the Bank of San Antonio. While it expanded at the second bank, he eventually attempted to broker a deal with Trans Pecos Bank to purchase the factored invoices. The money Schroeder gained was used to purchase cars, RVs, an airplane, a boat, and a beach house along with other purchases.
All of the defendants have entered a plea deal over the last year. Most recently, Schroeder agreed to plead guilty to one charge of conspiracy to commit bank fraud, but his plea hearing has not been scheduled yet.