Former Westminster Union/PNC Bank Employee Indicted on Charges of Bank Fraud and False Bank Entries
Indictment Seeks Forfeiture of Over $1 Million
Baltimore, Maryland - A federal grand jury has indicted Karen L. Baer, age 46, of Westminster, Maryland, on ten counts each of bank fraud and false bank entries in connection with a scheme to steal over $1 million from the bank where she worked, announced United States Attorney for the District of Maryland Rod J. Rosenstein. The indictment was returned on April 23, 2008 and unsealed today upon filing a protective order freezing Baer’s assets.
According to the indictment and other court documents from 2002 until her termination on October 25, 2007, Baer was the teller supervisor of the 140 Village Shopping Center branch of the Westminster Union Bank, an affiliate of Mercantile Bank (“Mercantile”), which in turn was merged into PNC in 2007. During that time, Baer had access to the money in her cash drawer and in the vault located at the 140 Village branch and was responsible for the movement of cash from the 140 Village branch to the Federal Reserve and from the Federal Reserve to the 140 Village branch. She was also responsible for recording those shipments by entering them in an internal account known as the “Due from Mercantile” account, which was used to track those cash shipments, among other things. A cash shipment from a branch was documented as a debit to the “Due from Mercantile” account. A cash shipment received by a branch was documented as credit to the “Due from Mercantile” account.
According to the indictment, beginning in 2002, and continuing to September 14, 2007, Baer defrauded Westminster Union, Mercantile, and PNC, by removing cash from the 140 Village branch for her own personal benefit, using an account at Westminster Union in the name of her father to deposit some of the cash she embezzled, against which she then wrote checks made payable to herself, her husband, and various entities and vendors to pay for expenses of the Baer family.
The indictment alleges that beginning in June 2004 and continuing on a weekly basis through September 2007, Baer made false entries in the “Due from Mercantile” account, by creating false debit and credit tickets purporting to reflect cash shipments sent from the 140 Village branch to the Federal Reserve, and cash shipments received by the 140 Village branch from the Federal Reserve, when no such cash shipments were sent from or received by the 140 Village branch. Baer submitted the fraudulent credit and debit tickets to the Due from Mercantile account in order to conceal her prior thefts of cash and to facilitate new thefts of cash from the 140 Village branch. When Baer stole additional amounts of cash, she would increase the running totals of her offsetting entries in the Due from Mercantile account by the amount of the theft, usually $10,000.
The indictment also seeks forfeiture of $1,050,000, including Baer’s interest in a residence, nine bank accounts, a 2004 Hummer H2, a Chevrolet Corvette, several snowmobiles and all terrain vehicles, as well as a tractor.
Baer faces a maximum sentence of 30 years in prison and a fine of $1 million, on each of 20 counts in the indictment. Baer is scheduled to have her arraignment in federal district court on May 2, 2008.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
United States Attorney Rod J. Rosenstein thanked the Federal Bureau of Investigation for its investigative work. Mr. Rosenstein commended Assistant United States Attorney Jonathan Biran, who is prosecuting the case.