Former Chief Financial Officer Indicted in $30 Million Bank Fraud
Thomas Torre, the former Chief Financial Officer of Metro Fuel Oil Corp. (“Metro Fuel”), located in Greenpoint, New York, has been charged in a two-count indictment with bank fraud and conspiracy for his participation in a scheme to overstate Metro Fuel’s accounts receivable in order to draw from a revolving line of credit issued by New York Commercial Bank. Metro Fuel later filed for bankruptcy after allegedly stealing over $30 million from the bank. The defendant is scheduled to be arraigned on Friday, September 26, 2014, at 11:00 a.m. before United States Magistrate Judge Vera M. Scanlon at the federal courthouse in Brooklyn.
The charges were announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, and George Venizelos, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI).
According to court filings, from approximately July 2007 to July 2012, the defendant and others falsely overstated the company’s accounts receivable on certificates submitted to the bank at least once per month. The bank used the information in the certificates to determine the amount Metro Fuel could borrow from the bank on its revolving line of credit. The defendant and others misrepresented the true accounts receivable by deliberately failing to account for the cash payments received from customers and by creating fictitious invoice amounts. By September 2012, the fuel company could no longer pay its bills and filed a voluntary petition for bankruptcy. At the time of the bankruptcy, the fuel oil company owed the bank more than $30 million.
“The defendant and his co-conspirators obtained tens of millions of dollars in loans from New York Commercial Bank under false pretenses, claiming both that they had real collateral and that they intended to pay the money back. Neither claim was true, and when Metro Fuel collapsed the bank was left holding the over $30 million bag. Those who perpetrate fraud against our financial institutions will be met with the full force of law enforcement,” stated United States Attorney Lynch. Ms. Lynch extended her grateful appreciation to the Federal Bureau of Investigation, the agency responsible for leading the government’s investigation.
If convicted, the defendant faces up to 30 years’ imprisonment on each count. The charges in the indictment are merely allegations, and the defendant is presumed innocent unless and until proven guilty.
This prosecution was the result of efforts by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ Offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit http://www.StopFraud.gov.
The government’s case is being prosecuted by Assistant United States Attorney William P. Campos.