A Morris County, New Jersey man has been arrested and charged with bank fraud and bribery in a scheme that netted $8 million.
Kurt Phelps, 52, of Flanders, New Jersey, was charged by complaint with one count of conspiracy to commit bank fraud and one count of bank bribery.
Phelps was released on $100,000 unsecured bond after making his initial appearance by videoconference before U.S. Magistrate Judge Mark Falk.
Three co-defendants, Douglas Arbolino, 59, of Central Valley, New York, Gary Swenson, 59, of Hardyston, New Jersey, and John Scott Brink, 59, of Jackson, New Jersey, pleaded guilty to their respective roles in the scheme.
The defendants conspired to defraud Victim Bank-1, Phelps’s employer, from 2013 through 2019. They obtained millions of dollars of credit from Victim Bank-1 for Starnet Business Solutions Inc., a now-defunct New Jersey-based printing company.
Phelps was aware that financial information Starnet provided to Victim Bank-1 was materially false. He coached Starnet on how to defraud Victim Bank-1 and solicited large cash bribes from Starnet in connection with the fraud scheme.
The conspiracy to commit bank fraud, bribery of a bank official, and bank bribery charges each carry a maximum potential penalty of 30 years in prison and a $1 million fine, or twice the gross gain or loss from the offense.
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Key Facts
- State: New Jersey
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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