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Karen R. Febles was originally arrested by FBI and IRS agents at her home in February and charged with bank fraud and money laundering.
As part of her job at a New York City bank, Febles “routinely prepared and negotiated checks on behalf of the victim,” U.S. Attorney Paul J. Fishman said.
Bank officials fired Febles, 47, and alerted authorities in September 2011 after discovering that she debited $1.8 million from her since-retired boss’s bank accounts over the course of four years, Fishman said.
Febles “routinely prepared checks” by hand, filled in the amounts and who they were to go to, and gave them to the victim among others to be signed, a complaint on file in U.S. District Court in Newark alleges.
She then added numbers and changed words – for instance, transforming one check from $900 to $9,900, the complaint says.
The totals “grossly exceeded the amounts that the Victim authorized to be withdrawn from his bank accounts,” it says.
“For example, in or about 2010, the Victim’s expenses which were to be paid in cash totaled approximately $450,000. However, checks in excess of $1,100,000 were issued that year from the Victim’s bank accounts,” the complaint says. “A review of bank records for the years 2008, 2009, and 2011 similarly revealed large amounts of unexplained withdrawals.”
Febles tried hiding some of the thefts by transferring more than $200,000 into a bank account she controlled in her young child’s name, the FBI said.
Records show Febles, who began working for the victim in 2000, spent $52,720 on the Range Rover, $34,650 on the Mercedes, more than $100,000 on real estate deals and more than $20,000 for payments on other vehicles. Tens of thousands of dollars went for entertainment, meal, pleasure trips and clothing, the complaint says.
“Other than the Victim, Febles was the only individual who had access to [his] bank accounts,” it adds.
A simple review of her financial records raised several red flags: Febles “never made more than $93,000 in salary” in any given year and didn’t have any other sources of income, the government says. Yet she deposited more than $870,000 over a four-year period into her personal bank accounts, according to the FBI complaint.
Of that, $470,000 was in checks made out to “petty cash” or “cash” and signed by her boss.
Febles was fired in September after it was discovered that she had been stealing from the victim while managing the official’s personal and professional finances, it says.
The government is represented by Assistant U.S. Attorneys Aaron Mendelsohn of the U.S. Attorney’s Office Economic Crimes Unit and Evan Weitz of the Office’s Asset Forfeiture and Money Laundering Unit in Newark.
“This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force,” Fishman said. “President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes.
“The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources.
“The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.”
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