Wednesday, May 11, 2016

Three plead guilty in $4 million Walnut Ridge bank fraud

Posted By on Wed, May 11, 2016 at 5:17 PM

The U.S. attorney's office says three women have pleaded guilty to fraud in stealing almost $4 million from the First National Bank of Lawrence County in Walnut Ridge.

The pleas came from Brenda Montgomery, 57, of Walnut Ridge, Peggy Sutton, 61, of Biggers, and Cindy Tate, 57, of Walnut Ridge. They'll be sentenced later.

Each defendant is responsible under the plea agreement for $1.317 million in restitution.

The long-time bank employees conspired to steal money from the bank vault, a news release from Chris Thyer's office said.

Tate had advance notice of internal audits and would arrange with Montgomery or Sutton to have cash transferred temporarily to the main vault from other branches of the bank, or from other corresponding banks, so that it would appear to the auditors that the count of cash on hand in the main vault was correct. Once the auditors had completed the count, Tate, Sutton, or Montgomery saw to it that cash which had been temporarily moved to the vault was then returned to the other branches or to the corresponding bank.

In April 2015, officials in management at First National became suspicious of the defendants’ conduct and arranged for a surprise cash count of the vault contents, at which time a shortage became apparent. A forensic audit confirmed that the three defendants had stolen bank funds by materially over representing the amount of cash on hand in the bank by $3,953,025.

The defendants remain free on bond. They face sentences up to 30 years. 

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