Fraud Case
[pic 1][pic 2]Background This case involves 42 years old bank’s executive from Lovettsville, VA. Ms. Linda S. Tribby worked for Wells Fargo (Wachovia) for more than two decades. She worked as a business relationship manager and maintained small business accounts in Northern Virginia. Her primary job requirements were to acquire, consult, and manage various small businesses portfolios. In December 2003, Ms. Tribby recommended Wachovia’s “wealth management accounts” to many of its loyal customers. She would often throw a perfect sales pitch to a credible client by stating that these accounts are designed for only preferred customers and this offering would earns tax-free interest returns. Ms. Tribby knew very well that these accounts do not exist and she was falsely presenting these accounts as a bank’s product. Ms. Tribby expertise in small business financial management convinced several clients to open wealth management accounts. Her first client requested to transfer $2.2 million from her checking account to a newly opened wealth management account. Ms. Tribby scheme gradually skyrocketed, transferring $14.1 million of customers to WMAs. She gave exceptional services to these clients by providing them her personal cell phone number, email address, and after hour consulting. Every time client requested to transfer money from his or her checking account to WMA, Ms. Tribby transfer funds from their accounts to unauthorized accounts. She then abused her executive authority to make herself or her relatives to be beneficiaries of those accounts. Clients were mailed fake bank statements, showing their monthly returns. Moreover, to gain client’s trust, she periodically deposited interest payments to customers’ checking accounts. Ms. Tribby’s warm and trusted personality made these clients to believe that their WMAs are well managed. Ms. Tribby and her family used these unauthorized transfers for personal reasons. These illegitimate proceeds were used to buy House in West Virginia, Several name brand carsRVs, Two hundred acre land in NY and Nevada,Lake house in NYHelicopterTwo Zebras Please see an exhibit A. for a complete list of illegal material possessions. In January 2011, FBI Washington D.C. field office investigated the case and Assistant U.S. Attorney Jasmine Yoon prosecuted Ms. Tribby’s case on behalf of the United States. During the Trial, Ms. Tribby explicitly shared her religious views and all possible rational excuses in 14 pages letter to a U.S. District Judge Liam O’ Grady to spare her from the crime. On March 4th, 2011, Ms. Tribby found guilty to one count of bank fraud and sentenced to 7 years in West Virginia federal prison. After her release, she was ordered by the judge to pay restitution of approximately $14 million to Wells Fargo during a probationary period.
Fraud Triangle Like many other fraud cases, all major elements of fraud triangle are present in this case. The perpetrator in this case had financial, vice, and other pressures. In 2001, several family members of Ms. Tribby were extremely sick and medical bills were piling up every month. She also had a trouble paying for her mortgage and consulted Wachovia (employer) to file for a bankruptcy, but the bank told her that it would be the end of her job (Jackman 2011). Due to an intense financial burden, Ms. Tribby abused alcohol, became addicted to gambling and had an extramarital affair. Ms. Tribby worked for the bank for a quite a long time and colleagues trusted her as being a senior executive. In her position, she was able to exploit bank’s internal control and transfer millions of dollars into her accounts without any suspicion. After the initial transfer of $2 million dollars, Ms. Tribby realized the opportunity to make easy money without raising any red flags and drastically increased transfer volume. During the trial, Ms. Tribby insisted that she stole funds to cover medical expenses and intended to return funds as soon as possible. In her defense, she told a court that she stole more money just to purchase items (cars, exotic pets, helicopter, and homes), so she can sell it for profit and return stolen funds back to the bank before someone noticed it. She also rationalized her actions by stating that she worked at the bank for 25 years and no one seems to understand her financial and family issues even after asking for assistance during a financial hardship. Fraud Symptoms Major symptoms in this case that someone could have noticed are related to the life style of the bank executive. Ms. Tribby drove several different cars to work almost every other week. It included Cadillac CTS, Volkswagen, and Dodge sports caravan. She also purchased expensive clothes, jewelry, and cosmetics that she wore to work everyday. Moreover, she started smoking and drinking intensively and lost her temper at couple of occasions with colleagues. Ms. Tribby also seemed irritated most of the time during her office hours.