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Ex-El Paso Credit Union Managers Jailed for Defrauding Institution
El Paso, TX – In a shocking case of financial deception, two former El Paso Federal Credit Union (EPFCU) managers have been sentenced to lengthy prison terms for their roles in a scheme to steal millions of dollars from the institution, leading to its demise.
On September 21, 2016, United States District Court Judge Philip Martinez sentenced 53-year-old Hilda Simental Mendoza to 121 months in federal prison, followed by five years of supervised release. In addition to the prison term, Judge Martinez ordered Mendoza to perform 100 hours of community service.
Five days earlier, on September 16, 2016, Judge Martinez sentenced 59-year-old Maria Guadalupe Hernandez to 188 months in federal prison, followed by five years of supervised release. Hernandez was also ordered to pay a $10,000 fine.
The defendants’ scheme, which began in August 2007, involved selling over 100 EPFCU share certificates to other credit unions without recording the sales in the credit union’s records. The monies generated from these unrecorded sales were placed into accounts controlled by the defendants, using relatives’ accounts, dormant customer accounts, and even active accounts belonging to deceased individuals.
The defendants used the generated funds to pay out dividends to investors and principal payments to prior purchasers of EPFCU share certificates. Hernandez allegedly used the monies for personal benefit, including travel, purchasing real estate, and vacations.
The defendants’ scheme was eventually uncovered in 2012, when examiners from the National Credit Union Administration (NCUA) discovered accounting irregularities in the credit union’s records. The NCUA subsequently liquidated EPFCU, and the defendants were charged with bank fraud, wire fraud, and conspiracy to commit both bank and wire fraud.
In a plea deal, the defendants admitted to their roles in the scheme, which resulted in a loss of $18,376,542. The case was investigated by the FBI, with assistance from the NCUA, and prosecuted by Assistant United States Attorney Chris Skillern.
Key Facts
- State: Texas
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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