September 10, 2021

Delaney Sexton
Contributing Editor

Fraud Friday – Two Bank Managers Sentenced in Bank Fraud Scheme

“Bank employee Herode Chancy used fake businesses, doctored bank statements, and stolen identities in an effort to obtain over $1 million in commercial loans.  Now Chancy has rightly been sentenced to prison for his crime.  Prosecutions like this one should serve as notice to individuals in positions of trust at financial institutions that engaging in corrupt criminal conduct will lead to prosecution and prison,” says U.S. Attorney Audrey Strauss.

Herode Chancy formed a commercial loan fraud scheme to gain more than $1 million. At the time of his crime, he was a branch manager in Manhattan for a national bank. From March of 2019 to March of 2020, Chancy and his codefendant, Ilori, would fraudulently obtain loans through a third-party commercial lender. The pair had no intentions of ever paying these loans back. There were eight fraudulent loan applications sent, and in total, they were applying for $1,025,000.

He and his partner would submit doctored bank statements and use other people’s identities to apply for commercial loans. The payments were received through bank accounts Chancy created using the stolen identities.

There was a third codefendant, Michael Albarella, that was also a manager for the bank Herode worked for. Together, they conspired to launder $200k of the expected loan proceeds into another bank account Albarella created using a stolen identity. Albarella accepted a $10,000 bribe to create the account.

It is believed that the underwriter of the third-party commercial lender was in on the scheme, and the underwriter was offered a commission to participate. The underwriter was actually an undercover law enforcement officer.

Herode Chancy was sentenced to 30 months in prison, two years of supervised release, and the forfeiture of $10,000 in fraudulent loan proceeds. Michael Albarella was sentenced to six months in prison and three years of supervised release. Ilori is waiting to be sentenced on October 13, 2021.

Source:
DOJ Press Release