Maryland Man Sentenced to 90 Months in Prison for Attempting to Defraud Twenty-Eight Federal Bankruptcy Courts Out of More Than $1.8 Million in Unclaimed Funds

SAN JUAN, Puerto Rico – On July 14, 2025, a Maryland man was sentenced to 90 months (seven years and six months) in prison for mail and wire fraud, falsification of bankruptcy records, and aggravated identity theft, in connection with his scheme to defraud twenty-eight federal bankruptcy courts, announced W. Stephen Muldrow, United States Attorney for the District of Puerto Rico.

Defendant Osakwe Ismael Osagbue was indicted on April 3, 2024, and plead guilty on February 19, 2025.

According to court documents, from 2022 through April 2024 Osagbue devised a scheme to obtain money under the custody of various United States Bankruptcy Courts by submitting false documents impersonating unsuspecting individuals and requesting the withdrawal of unclaimed funds. Osagbue used the Federal Judiciary’s Public Access to Court Electronic Records system (PACER) to search for and identify bankruptcy cases with unclaimed funds. Osagbue would then mail the corresponding bankruptcy court a fraudulent application for payment of unclaimed funds. These fraudulent applications contained the means of identification of real people, including names and social security numbers, and signatures.  The fraudulent applications sought payment to bank accounts controlled by Osagbue in the names of the individual victims. On occasion, Osagbue followed-up by sending e-mail communications to court personnel using fraudulent e-mail accounts in the names of the unsuspecting individual victims. Upon receipt of payment, Osagbue would withdraw funds from automatic teller machines (ATMs) and deposit cash into his own personal bank account in his true name.

As part of his scheme, Osagbue submitted applications for more than $1.8 million in unclaimed funds. The twenty-eight United States Bankruptcy Courts involved are as follows:

1.         The District of Puerto Rico;

2.         The Northern District of Alabama;

3.         The District of Arizona;

4.         The District of Colorado;

5.         The District of Connecticut;

6.         The District of Delaware;

7.         The Middle District of Florida;

8.         The District of Hawaii;

9.         The Northern District of Illinois;

10.       The Southern District of Indiana;

11.       The Eastern District of Kentucky;

12.       The Western District of Louisiana;

13.       The Eastern District of Michigan;

14.       The Southern District of Mississippi;

15.       The Eastern District of Missouri;

16.       The District of Montana;

17.       The District of Nevada;

18.       The District of New Jersey;

19.       The Eastern District of New York;

20.       The Eastern District of North Carolina;

21.       The Northern District of Ohio;

22.       The Southern District of Ohio.

23.       The Western District of Pennsylvania;

24.       The District of Rhode Island;

25.       The District of Utah;

26.       The Eastern District of Washington;

27.       The District of Washington D.C., and

28.        The Eastern District of Wisconsin

The United States Secret Service investigated this case in furtherance of its mission to combat cutting edge and complex financial crimes that pose a threat to the federal government and the nation’s economic security. The United States Bankruptcy Court for the District of Puerto Rico (BCPR) reported the fraudulent scheme to federal authorities.

“This sentencing reflects the US Attorney’s Office ongoing commitment to prosecuting sophisticated fraudsters who abuse the system,” said W. Stephen Muldrow, United States Attorney for the District of Puerto Rico. “Thanks to the relentless efforts of our multiagency partners, we will continue to aggressively pursue accountability for perpetrators whose actions impact the integrity of the United States courts and the integrity of the United States bankruptcy system.

“Filing fraudulent unclaimed funds requests strike at the integrity of the bankruptcy system.  This sentence will go a long way in protecting it,” said Monsita Lecaroz-Arribas, Assistant U.S. Trustee for the District of Puerto Rico.  “We are grateful to U.S. Attorney Muldrow and our law enforcement partners, such as the United States Secret Service, for their commitment to protect the interests of the bankruptcy process in Puerto Rico and nationwide. Together with them, we will continue to pursue fraud and abuse in bankruptcy cases here and across the country.”

Special Assistant U.S. Attorney José Capó-Iriarte and Special Assistant U.S. Attorney José Carlos Díaz-Vega from the United States Department of Justice, Office of the United States Trustee, San Juan field office, prosecuted the case.  The United States Trustee Program, through its Office of Criminal Enforcement provided assistance as part of their responsibilities of coordinating criminal enforcement activities in the investigation and prosecution of bankruptcy related crimes throughout the United States and Puerto Rico, with the mission to protect the nation’s bankruptcy system and to promote the integrity and efficiency of the bankruptcy system for the benefit of debtors, creditors, and the public.

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