Maria Eliza Garza, Houston, Texas, has pleaded guilty to conspiring to defraud seven different Houston-area banks of more than $2 million in 2007 and 2008.
As outlined in documents filed with the court and admitted by Garza during her guilty plea, she and a co-conspirator agreed to carry out a check kiting scheme that targeted seven different financial institutions in the Houston area. While the co-conspirator allegedly devised the scheme that used multiple bank accounts held in the name of title companies he controlled, Garza admitted she assisted by discussing which bank accounts needed money, preparing checks to sign, and depositing signed checks at the banks.
Garza admitted as part of her plea that she helped carry out the scheme from at least January 2007 through June 2008. To do so, Garza prepared checks drawn on the title companies’ accounts. The co-conspirator signed the checks and both knew the accounts lacked sufficient funds to cover the checks. Garza deposited the checks into other accounts controlled by the co-conspirator, which artificially inflated the account balances. They would then write additional checks using the artificially inflated balances and deposit them into either the original issuing account or other accounts controlled by the co-conspirator.
Garza also admitted she and conducted the scheme to artificially inflate the account balances and place the funds at her co-conspirator’s disposal to use as interest-free loans and lines of credit. They continued to carry out the scheme even after three of the banks discovered the kiting activity and shut down the relevant accounts. When the scheme finally collapsed in June 2008, the total loss to the affected banks was $2,099,65.72.
U.S. District Judge Lee H. Rosenthal, who accepted Garza’s plea, has set sentencing for December 17, 2013, at which time she faces up to five years in federal prison and a $250,000 fine or twice the pecuniary gain or loss.
United States Attorney Kenneth Magidson announced the guilty plea.
The case is being investigated by the FBI and being prosecuted by Assistant U.S. Attorney John Pearson.