FBI: Embezzlement Led to CU Failure

Credit Union Manager Allegedly Stole $2.3 Million
FBI: Embezzlement Led to CU Failure

A former manager at now defunct Borinquen Federal Credit Union in Philadelphia has been charged with embezzling more than $2.3 million, which led to the credit union's failure, according to the Federal Bureau of Investigation.

See Also: Key Trends in Payments Intelligence: Machine Learning for Fraud Prevention

Ignacio Morales, also known as Nacho, was charged with several crimes that carry a combined maximum penalty of life in prison.

Federal authorities say that Morales used his position as manager at BFCU to misuse funds through various schemes. They allege that:

  • From September through December 2009, Morales embezzled $560,000 to attempt to purchase 15 kilograms of cocaine;
  • Between 2008 and 2009, he embezzled $600,000 to purchase real estate;
  • In September 2008, he failed to deposit $700,000 into an account of a credit union member, instead using the money for his own purposes.

"It is further alleged that Morales intentionally altered bank records and other reports provided to the National Credit Union [Administration] and their auditors in order to conceal his misuse of BFCU funds," the FBI said.

The NCUA in June 2011 took over operations at BFCU, but within two weeks the credit union was liquidated.

Morales is charged with conspiracy to defraud the government, misapplication and embezzlement, false reports on federal credit institution entities, engaging in monetary transaction in property derived from specified unlawful activity, filing false federal income tax returns, and attempted possession with intent to distribute more than five kilograms of cocaine.

He faces a maximum sentence of life in prison, with a mandatory minimum sentence of 10 years, if convicted on all charges, the FBI said. He would also face a mandatory minimum of five years' supervised release and a fine of up to $12.55 million.


About the Author

Jeffrey Roman

Jeffrey Roman

News Writer, ISMG

Roman is the former News Writer for Information Security Media Group. Having worked for multiple publications at The College of New Jersey, including the College's newspaper "The Signal" and alumni magazine, Roman has experience in journalism, copy editing and communications.




Around the Network

Our website uses cookies. Cookies enable us to provide the best experience possible and help us understand how visitors use our website. By browsing bankinfosecurity.com, you agree to our use of cookies.