Alexsandr Bernik, 29, Sacramento, California, was indicted on charges of wire fraud, money laundering, and making false statements to federally insured banks to obtain real estate loans. Bernik was previously arrested on April 30, 2008, on a criminal complaint filed in connection with this investigation and was ordered detained as a flight risk.

According to Assistant United States Attorney Courtney J. Linn, who is prosecuting the case, the indictment charges that in late 2005, Bernik applied for and obtained loans from federally insured lenders secured by residential real property in the Sacramento, California area. In connection with those loans, the indictment charges that Bernik knowingly made false statements overstating his income and knowingly submitted false bank statements to influence the banks to loan him money.

The indictment further charges that from October 2005 through November 2006, Berniki engaged in a scheme to defraud American Express and its customers. He used the fictitious business name Lexbay Limited to open a bank account and establish a merchant relationship with American Express. Between August 2006 and November 2006, he fraudulently charged American Express customers for products or services that the customers did not order. During this time period, a bank account he controlled in the name of Lexbay Limited received approximately $177,000 from American Express. Some of those funds were then withdrawn in transactions designed in part to avoid transaction reporting requirements under state and federal law.

The maximum penalties for wire fraud is 20 years in prison, and a fine of up to $250,000. The maximum penalty for money laundering is 20 years in prison and a fine of up to $500,000. The maximum penalty for making false statements to a federally insured lender is 30 years in prison and a fine of not more than $1,000,000. The actual sentence, however, will be determined at the discretion of the court after consideration of the Federal Sentencing Guidelines, which take into account a number of variables and any applicable statutory sentencing factors.