Two Bank Insiders And A Third Man Arrested In Bank Bribery And Money Laundering Conspiracy

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), and Peter C. Fitzhugh, Special Agent in Charge of the New York Office of Homeland Security Investigations (“HSI”), announced today the arrest of HERODE CHANCY and MICHAEL ALBARELLA, who are both employed as managers at a Manhattan branch of a national bank (“Bank-1”), and ADEDAYO ILLORI for engaging in a scheme to fraudulently obtain business loans and to launder the proceeds of that scheme using a bank account opened with a stolen identity.  CHANCY, ALBARELLA, and ILORI were arrested in the New York metropolitan area and are expected to be presented before U.S. Magistrate Judge Kevin Nathaniel Fox in Manhattan federal court.   

U.S. Attorney Geoffrey S. Berman said:  “Bank employees, Herode Chancy and Michael Albarella, and another individual, Adedayo Illori, allegedly engaged in a scheme to use a stolen identity to secure over $1 million in illegal loans.  Furthermore, the defendants allegedly offered the underwriter of the fraudulent loans – who unbeknownst to them was an undercover law enforcement officer – a commission to carry out their scheme.  The defendants stated that they wanted to ‘bust out’ the ill-gotten loans, but ironically find themselves busted for serious federal crimes.”           

FBI Assistant Director William F. Sweeney Jr. said:  “The three subjects in this fraud scheme allegedly thought they could ‘bust out’ of a loan, and steal millions of dollars that wasn’t theirs.  But they got caught, and now they’ll have even more trouble ‘busting out’ of their next destination, a federal prison.  I want to commend the work done by our law enforcement partners and the FBI New York Joint Organized Crime Task Force, who do all they can to protect the public from fraudsters who use insiders to aid and hide their theft.”

HSI Special Agent in Charge Peter C. Fitzhugh said:  “Driven by greed, Chancy and Albarella, allegedly abused their positions as bank officials to perpetrate this loan ‘bust out’ scheme.  By allegedly conspiring with Ilori, the three men were responsible for fraudulently obtaining in excess of $1 million in loans while victimizing the lending institution.  Utilizing the expertise of HSI New York’s El Dorado Financial Crimes Task Force along with our law enforcement partners, this trio was arrested and will have to face criminal charges including money laundering, wire fraud, identity theft and bank bribery.”

As alleged in the Complaint unsealed in Manhattan federal court^[1]:

From at least in or about March 2019 up to and including at least in or about March 2020, CHANCY and ILORI conspired to obtain business loans fraudulently from a third-party commercial lender with the intent to “bust out,” that is, not repay, the loans.  CHANCY and ILORI submitted eight fraudulent business loan applications for a total of $1,025,000 in business loans in furtherance of this scam.  The business loan applications submitted by CHANCY and ILORI included doctored bank statements and listed the identities of other persons as the loan applicants.  CHANCY and ILORI also opened bank accounts using the identities of those other persons in order to receive the loan payments from the third-party commercial lender.  CHANCY and ILORI believed that the underwriter for the third-party commercial lender was participating in the scheme and agreed to pay the underwriter a “commission” for the underwriter’s role in the scheme.  In reality, however, the underwriter was an undercover law enforcement officer.

To effect their illegal scheme, CHANCY and ILORI conspired with bank insider ALBARELLA to launder approximately $1 million of the expected proceeds of the loan scheme.  ALBARELLA opened a bank account at Bank-1 using a stolen identity in order to launder the proceeds of the loan scheme, and ALBARELLA accepted a $10,000 bribe in order to open the bank account.    

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CHANCY, 40, and ILORI, 42, are charged with: (1) conspiracy to commit wire fraud, (2) wire fraud, (3) aggravated identity theft, and (4) conspiracy to commit money laundering.  ALBARELLA, 34, is charged with: (1) conspiracy to commit money laundering, and (2) bank bribery.  

Wire fraud and conspiracy to commit wire fraud, in violation of 18 U.S.C. §§ 1343 and 1349, carries a maximum of 20 years in prison.  Aggravated identity theft, in violation of 18 U.S.C. § 1028A, carries a mandatory term of two years in prison, to be served consecutively to any other term of imprisonment.  Conspiracy to commit money laundering, in violation of 18 U.S.C. § 1956(h), carries a maximum term of 20 years in prison.  Bank bribery, in violation of 18 U.S.C. § 215, carries a maximum term of 30 years in prison.  The statutory maximum sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge. 

Mr. Berman praised the outstanding investigative work of the FBI and HSI.

This case is being handled by the Office’s Money Laundering and Transnational Criminal Enterprises Unit.  Assistant United States Attorneys Tara M. La Morte and Cecilia E. Vogel are in charge of the prosecution.

The allegations in the Complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.