May 1, 2024 - LOS ANGELES – Two Los Angeles men pleaded guilty today to federal criminal charges for defrauding banks and credit unions out of at least $2.7 million by depositing checks stolen from the mail into bank accounts belonging to accomplices they recruited through Instagram.

Carlos Corona, 36, of South Los Angeles, and Jose Luis Edeza Jr., 31, of Sunland, the two lead defendants in this criminal case, each pleaded guilty to one count of conspiracy to commit bank fraud and one count of aggravated identity theft.

According to their plea agreements, from October 2020 to August 2023, Corona, Edeza and other co-conspirators engaged in an elaborate bank fraud scheme using third-party bank accounts and stolen checks. Some co-conspirators stole checks from the U.S. mail stream, including from post office mail collection boxes located outside post offices.

The conspirators took possession of the stolen checks. They, along with others, then solicited bank account holders through social media to provide their debit cards and bank account information, promising these account holders a cut of any fraudulent funds deposited into their accounts.

To circumvent the fraud protections of the banks and credit unions, Corona, Edeza and others specifically requested bank accounts that had been open for a certain amount of time so they could get access to the stolen funds more quickly.

Bank account holders responded to the social media advertisements and provided members of the conspiracy with the information requested on the ads, including bank account numbers, PIN numbers, debit cards and online banking log-in information.

Corona, Edeza and other co-conspirators exchanged the bank account holders’ information with each other, and then they deposited the stolen checks into these bank accounts. In most cases, the stolen checks were falsely endorsed in the original payee’s name. Sometimes, the checks were washed or altered to make the payee name correspond to the bank account into which the checks were being deposited.

Corona, Edeza and other co-conspirators then rapidly depleted the fraudulently deposited funds from the account holders’ accounts by making cash withdrawals, electronic transfers and/or debit card purchases. To conceal the fraud, members of the conspiracy instructed account holders – if the banks and credit unions contacted them about the fraudulent deposits – to claim that their accounts had been compromised.

During the scheme, Corona and Edeza intended to cause at least $5.3 million in losses to the banks and credit unions and caused actual losses to lenders of at least $2.7 million.

United States District Judge John F. Walter scheduled July 8 sentencing hearings for Corona and Edeza, at which time each defendant will face a statutory maximum sentence of 30 years in federal prison for the bank fraud conspiracy count and a mandatory two-year consecutive prison sentence for the aggravated identity theft count.

The United States Postal Inspection Service and IRS Criminal Investigation are investigating this matter. The Los Angeles Police Department provided assistance.

Assistant United States Attorneys Sarah E. Spielberger and Alexandra Michael, both of the General Crimes Section, are prosecuting this case.
Source: DOJ Release