Prosecutor: Union County Man Stole $700,000 From Banks, Was Ringleader In Money Laundering Scheme

A Union County man has been indicted on first-degree charges for allegedly serving as the ringleader in a scheme to steal $700,000 from various banks and depositing more than $1.6 million in counterfeit checks.

Harold Stephens, 31, of Elizabeth, Michael Caldwell, 39, of Irvington, and Janilyn Roman, 21, of Orlando Fla. were charged with first-degree conspiracy, two counts of first-degree money laundering, second-degree theft by deception, and third-degree forgery.

Elizabeth resident Harold Stephens, the alleged ringleader, is charged with a third count of first-degree money laundering and a second count of third-degree forgery.

Stephens allegedly purchased legitimate checks from people for a small price, often targeting customers entering check cashing businesses. He then allegedly used a computer graphics program to print counterfeit checks which matched the legitimate checks but which were written for large sums payable to other persons.

>> More: Union County Residents Caught With $37,500 In Heroin, Cocaine

Between January 2012 and September 2014, Stephens, Caldwell, Roman and other participants in the scheme allegedly deposited roughly 300 counterfeit checks in amounts totaling over $1.6 million into numerous third-party bank accounts at branch offices of five major banks in New Jersey, Pennsylvania, Delaware and Florida.

“These con artists face up to 20 years in state prison for being so prolific in their alleged crimes. Most large-scale financial crimes cross numerous jurisdictional lines as criminals seek to wash their cash through seemingly legitimate means.”

Stephens, Caldwell and Roman then allegedly stole more than $700,000 by withdrawing funds from the deposit of the counterfeit checks before the banks discovered the fraud.

“This trio allegedly used a computer graphics program to create counterfeit checks, which they quickly converted to cash by taking advantage of banks with customer-friendly policies on fund availability,” said Acting Attorney General Hoffman. “They were essentially printing money. Fortunately, as financial fraud has become more sophisticated, we have kept pace, bringing con artists like these to justice through cutting-edge investigations.”

Stephens allegedly used individuals, including Caldwell, as “recruiters” to obtain bank account information, debit cards and pin numbers from people willing to be named as payees on the counterfeit checks.

The defendants would then use the payees’ bank accounts to deposit the checks and withdraw the proceeds, a process Stephens allegedly referred to as “washing” the checks.

The recruiters and payees were allegedly paid by the defendants for their roles in the scheme. Roman allegedly was involved in depositing counterfeit checks and withdrawing funds in Florida.

The defendants allegedly targeted banks that allow funds from deposited checks to be withdrawn by their customers the next day. In some instances, the payees would open a new account that would be used to “wash” counterfeit checks.

However, in at least one instance, the payee’s bank account information and debit card were stolen for use in the scheme. It is alleged that, to further launder the stolen funds, Stephens would use them to purchase money orders and gift cards for various stores.

Stephens allegedly used individuals, including Caldwell, as “recruiters” to obtain bank account information, debit cards and pin numbers from people willing to be named as payees on the counterfeit checks.

The defendants would then use the payees’ bank accounts to deposit the checks and withdraw the proceeds, a process Stephens allegedly referred to as “washing” the checks.

The recruiters and payees were allegedly paid by the defendants for their roles in the scheme. Roman allegedly was involved in depositing counterfeit checks and withdrawing funds in Florida.

The defendants allegedly targeted banks that allow funds from deposited checks to be withdrawn by their customers the next day. In some instances, the payees would open a new account that would be used to “wash” counterfeit checks.

However, in at least one instance, the payee’s bank account information and debit card were stolen for use in the scheme. It is alleged that, to further launder the stolen funds, Stephens would use them to purchase money orders and gift cards for various stores.

Stephens and Caldwell were arrested at their homes on Aug. 6, 2014, by members of the investigating agencies. Roman was arrested the following day, Aug. 7, by the Orlando Police Department. She was extradited to New Jersey with the assistance of the U.S. Marshals Service.

“These con artists face up to 20 years in state prison for being so prolific in their alleged crimes,” Director Elie Honig of the Division of Criminal Justice stated. “Most large-scale financial crimes cross numerous jurisdictional lines as criminals seek to wash their cash through seemingly legitimate means.”

Harold Stephens, 31, of Elizabeth, Michael Caldwell, 39, of Irvington, and Janilyn Roman, 21, of Orlando Fla. were charged with first-degree conspiracy, two counts of first-degree money laundering, second-degree theft by deception, and third-degree forgery.

“Postal Inspectors, along with other law enforcement agents, unraveled a sophisticated counterfeit check scheme that resulted in thousands of dollars in losses,” said Inspector in Charge Maria Kelokates, Newark Division of the U.S. Postal Inspection Service.

Stephens is free after posting $250,000 bail. The other two defendants remain in the Middlesex County Jail, with bail set at $250,000 for Caldwell and $150,000 for Roman.

The first-degree money laundering charge carries a sentence of 10 to 20 years in state prison, including a mandatory minimum term of parole ineligibility of one-half to one-third of the sentence imposed.

That charge also carries a criminal fine of up to $500,000, and an additional anti-money laundering profiteering penalty of up to $500,000 or three times the value of any property involved.

The first-degree conspiracy charge carries a sentence of 10 to 20 years in prison and a fine of up to $200,000. Second-degree charges carry a sentence of five to 10 years in prison and a fine of up to $150,000, while third-degree charges carry a sentence of three to five years in prison and a fine of up to $15,000.

For breaking news alerts and more from Patch, sign up for the daily newsletter by clicking on the links below.

Westfield* Clark-Garwood* Cranford* New Providence-Berkeley Heights * Scotch Plains-Fanwood* Springfield* Summit* Chatham* West Orange

More on Patch:

• Union County Residents Caught With $37,500 In Heroin, Cocaine
• UPDATE: Union County Man Who Murdered Wife, Dumped Body In Suitcase Sentenced To Life In Prison
• Convicted: Union County Cop With HIV Had Sex With Two Women Without Revealing Status
• Cops Stop Teens for Shoveling Snow, Stirring A Heap Of Controversy
• POLL: Where’s the Best Place to Go Sledding In Union County?