TORONTO - (06/24/04) -- Authorities said they have alreadyconvicted and sentenced the main suspect in a phony credit unionscam that siphoned hundreds of thousands of dollars form victimsacross the U.S. over the past year. Leslie Card, 35, pleaded guiltyMonday to two counts of financial fraud and was sentenced to 18months in prison, His brother, Kevin Card, 33, also believedinvolve din the scam, is scheduled for trial on weapons and drugcharges June 30. But authorities don't expect the phony creditunion scam to stop. "No, this won't end it," Detective Jim White,of the Toronto Police, told The Credit Union Journal. "They're justpart of a bigger picture. It's too lucrative of an operation." Butthe Card's were apparently the main perpetrators in a scheme thatused stolen credit card information to buy ads in U.S. newspaperspurporting to sell debt consolidation, credit insurance andmortgage loan originations through phony credit unions, often withnames legitimate credit unions, like Heartland CU, Century CU,Credit Union One and America's Choice CU. The Heartland CU schemewas apparently the most lucrative, according to White, asauthorities have been able to trace about $295,000 (U.S.) in fundsraised from it. And that's with a 5% reporting rate, with as muchas 95% of these crimes unreported, he explained.
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The Jackson, Mississippi, company will use proceeds from the sale of its Fisher Brown Bottrell Insurance unit to restructure its investment portfolio, moving $1.6 billion of low-yield securities off the balance sheet.
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The store-branded card issuer is raising annual percentage rates and adding fees for paper statements to compensate for lost revenue. The Consumer Financial Protection Bureau's new regulation is scheduled to take effect on May 14.
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At the banks' annual meetings, shareholders at both companies struck down proposals that would have split the board chair and CEO roles. Two other proposals also failed to win shareholder support, one concerning energy financing and another on pay gap analysis.
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Congressional Review Act resolutions are ramping up ahead of the 2024 election cycle. Experts say that, although none are likely to become law, the resolutions are still powerful messaging and political tools.
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The ABA is testing an information-exchange network to allow banks to share their fraud data with each other. Companies including Baselayer are also building solutions.
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Republicans on the House and Senate Small Business committees are accusing the SBA of being irresponsible in granting Funding Circle permission to participate in its flagship loan-guarantee program.
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