Rhonda Lee Devries Pleads Guilty in U.S. Federal Court
The United States Attorney's Office announced that during a federal court session in Great Falls, on August 20, 2012, before U.S. District Judge Sam E. Haddon, RHONDA LEE DEVRIES, a 50-year-old resident of Malta, pled guilty to bank fraud/embezzlement by a bank officer, credit card fraud, and money laundering. Sentencing has been set for November 26, 2012. She is currently released on special conditions.
In an Offer of Proof filed by Assistant U.S. Attorney Carl E. Rostad, the government stated it would have proved at trial the following:
DEVRIES was the Vice President of Operations for the First Security Bank (FSB) in Malta. FSB deposits are federally insured.
By January of 2001, DEVRIES had accumulated personal credit card debt of approximately $40,000. Up to that point, DEVRIES had been managing the large credit balances by transferring the balances to new credit cards. In January 2001, she was declined by a credit card company which jeopardized her ability to keep the existing accounts from going into default, cancellation, and collection.
DEVRIES then opened a fraudulent credit card account at FSB for which she could, by virtue of her position, approve and establish a "high limit" for credit debt. The first credit card account was opened on January 4, 2001 in the name of RI, Inc. That account had a credit limit of $900,000, and had a balance of $1,100,243 when the embezzlement was discovered in May of 2012.
When the first credit account was established and used without detection, DEVRIES opened a second fraudulent FSB credit card account. Opened under the name ADRD - with a credit limit of $900,000 - this credit card account was created on September 14, 2001, and had a balance of $1,087,562 when discovered in May 2012.
A third credit card account was opened on May 7, 2009, with the letters ADCDED and with a credit limit of $900,000. The account had a balance of $1,180,329 when discovered by FSB in May 2012.
A fourth and final FSB credit card was created on June 2, 2011, using the letters and numbers ABC123 and with a credit limit of $99,000, and had a balance of $304,493 when the activity was stopped in May 2012.
On April 30, 2012, the credit card servicing company for FSB, Fidelity National Information Systems (NIS), contacted FSB to report suspicious activity on three credit accounts. An employee printed out the information on the suspicious accounts - the three over $1,000,000 - and took the information to the bank president. The following morning, the bank president called DEVRIES to his office and started going over the information. DEVRIES immediately admitted that she was responsible for the fraudulent accounts.
DEVRIES later admitted to bank officers and ultimately the FBI, that she used the fictitious credit cards to obtain cash advances which she would then use to purchase money orders made payable to herself, her creditors, and other third parties. DEVRIES stated that she had trouble recalling how she spent the money she embezzled.
The investigation revealed, and DEVRIES confirmed, that she kept the embezzlement scheme hidden from FSB by taking meticulous steps in the monitoring and handling of the accounts.
DEVRIES created fictitious names for the fraudulent credit card accounts that unrelated to her or any bank customer.
Each account name included a long series of the letter "Z," which would make it less likely that another FSB employee would happen upon the account when conducting routine business.
Each time DEVRIES created a fraudulent credit card account, she would bypass established bookkeeping procedures for opening a new credit card account, such as loan applications, submitting the account for supervisory approval, and processing the accounts through a credit committee (a requirement for any credit account with a limit over $5000).
DEVRIES defeated all internal controls that would have revealed the existence and use of the fraudulent credit cards.
When DEVRIES made money order payments to herself using cash advances from the fraudulent credit card accounts, she would use the name of a legitimate customer as the purchaser for the cashier's check or money order so that suspicion would not be raised if the cashier's checks were reviewed during daily business or during bank examinations.
When a list of credit card customers was requested by bank management, DEVRIES would manually create the report and ensure that the fraudulent accounts were excluded.
To defeat the regulators conducting bank inspections, DEVRIES would falsely state that the report on credit card accounts had to be ordered from the credit card service company and claim that, although requested, the requested reports had not arrived prior to the arrival of the examiners.
To insure that NIS did not tip off FSB, DEVRIES provided NIS with misleading contact information, having created a separate personal e-mail account and directing all NIS inquiries to that account.
In charges, interest, and fees, DEVRIES caused to be charged to the four accounts approximately $3,672,627.
DEVRIES faces possible penalties of 30 years in prison, a $1,000,000 fine and 5 years supervised release.
The investigation was a cooperative effort between the Federal Bureau of Investigation and the Criminal Investigation Division of the Internal Revenue Service.