TRENTON – Acting Attorney General John Hoffman announced that three people were indicted today on first-degree charges of conspiracy and money laundering for allegedly stealing $700,000 from various banks through a counterfeit check scheme.
The Division of Criminal Justice Corruption Bureau obtained a seven-count state grand jury indictment charging the following defendants with first-degree conspiracy, two counts of first-degree money laundering, second-degree theft by deception, and third-degree forgery: Harold Stephens, 31, of Elizabeth; Michael Caldwell, 39, of Irvington; and Janilyn Roman, 31, of Orlando, Fla.
Stephens, the alleged ringleader, also is charged with a third count of first-degree money laundering and a second count of third-degree forgery. The indictment is the result of an investigation by the New Jersey State Police, the Division of Criminal Justice and the U.S. Postal Inspection Service.
Between January 2012 and September 2014, Stephens, Caldwell, Roman and other participants in the scheme allegedly deposited roughly 300 counterfeit checks in amounts totaling over $1.6 million into numerous third-party bank accounts at branch offices of five major banks in New Jersey, Pennsylvania, Delaware and Florida.
Stephens, Caldwell and Roman then allegedly stole more than $700,000 by withdrawing funds from the deposit of the counterfeit checks before the banks discovered the fraud.
“This trio allegedly used a computer graphics program to create counterfeit checks, which they quickly converted to cash by taking advantage of banks with customer-friendly policies on fund availability,” said Hoffman. “They were essentially printing money. Fortunately, as financial fraud has become more sophisticated, we have kept pace, bringing con artists like these to justice through cutting-edge investigations.”
“Financial fraud costs banks, credit card companies, retailers and private citizens many millions of dollars every year,” said Director Elie Honig of the Division of Criminal Justice. “With cases such as this one, we’re putting offenders on notice that the more they steal, the longer they’ll spend in prison. These con artists face up to 20 years in state prison for being so prolific in their alleged crimes.”
“Most large-scale financial crimes cross numerous jurisdictional lines as criminals seek to wash their cash through seemingly legitimate means. The strength of our partnerships with other agencies therefore determines the level of our success in tracking down the ringleaders and the networks they create,” said Colonel Rick Fuentes, Superintendent of the New Jersey State Police.
“Postal Inspectors, along with other law enforcement agents, unraveled a sophisticated counterfeit check scheme that resulted in thousands of dollars in losses,” said Inspector in Charge Maria Kelokates, Newark Division of the U.S. Postal Inspection Service. “Postal Inspectors will continue to aggressively pursue investigations in which Postal Service products and the U.S. Mail are used to facilitate a crime.”
Stephens allegedly purchased legitimate checks from people for a small price, often targeting customers entering check cashing businesses. He then allegedly used a computer graphics program to print counterfeit checks which matched the legitimate checks but which were written for large sums payable to other persons.
Stephens allegedly used individuals, including Caldwell, as “recruiters” to obtain bank account information, debit cards and pin numbers from people willing to be named as payees on the counterfeit checks. The defendants would then use the payees’ bank accounts to deposit the checks and withdraw the proceeds, a process Stephens allegedly referred to as “washing” the checks.
The recruiters and payees allegedly were paid by the defendants for their roles in the scheme. Roman allegedly was involved in depositing counterfeit checks and withdrawing funds in Florida.
The defendants allegedly targeted banks that allow funds from deposited checks to be withdrawn by their customers the next day. In some instances, the payees would open a new account that would be used to “wash” counterfeit checks.
However, in at least one instance, the payee’s bank account information and debit card were stolen for use in the scheme. It is alleged that, to further launder the stolen funds, Stephens would use them to purchase money orders and gift cards for various stores.
Stephens and Caldwell were arrested at their homes on Aug. 6, 2014, by members of the investigating agencies. Roman was arrested the following day, Aug. 7, by the Orlando Police Department. She was extradited to New Jersey with the assistance of the U.S. Marshals Service.
Stephens is free after posting $250,000 bail. The other two defendants remain in the Middlesex County Jail, with bail set at $250,000 for Caldwell and $150,000 for Roman.
The case was presented to the state grand jury by Deputy Attorneys General Cambridge Ryan and Jeffrey Manis of the Division of Criminal Justice Corruption Bureau, under the supervision of Deputy Attorney General Anthony Picione, Bureau Chief.
The investigation was led by Detective Sgt. Robert Wronski of the New Jersey State Police Official Corruption North Unit, Detective Katelyn Sake of the Division of Criminal Justice Financial & Computer Crimes Bureau, and U.S. Postal Service Inspector Brian MacDonald. Acting Attorney General Hoffman thanked the Piscataway Police Department for providing valuable assistance in the investigation.
The first-degree money laundering charge carries a sentence of 10 to 20 years in state prison, including a mandatory minimum term of parole ineligibility of one-half to one-third of the sentence imposed. That charge also carries a criminal fine of up to $500,000, and an additional anti-money laundering profiteering penalty of up to $500,000 or three times the value of any property involved.
The first-degree conspiracy charge carries a sentence of 10 to 20 years in prison and a fine of up to $200,000. Second-degree charges carry a sentence of five to 10 years in prison and a fine of up to $150,000, while third-degree charges carry a sentence of three to five years in prison and a fine of up to $15,000.
The indictment is merely an accusation and the defendants are presumed innocent until proven guilty. The indictment is posted with this press release at www.njpublicsafety.com.
The indictment was handed up to Superior Court Judge Mary Jacobson in Mercer County, who assigned the case to Middlesex County, where the defendants will be ordered to appear in court at a later date for arraignment on the charges.