Second Defendant in Retail Refund Fraud Scheme Sentenced

Second Defendant in Retail Refund Fraud Scheme Sentenced

Second Defendant in Retail Refund Fraud Scheme Sentenced to 12½ Years in Prison

SACRAMENTO, CA (STL.News) A former resident of Union City was sentenced Thursday by U.S. District Judge Morrison C. England Jr. to 12 years and seven months in prison for a conspiracy to commit a bank fraud scheme that attempted to defraud financial institutions of more than $4.3 million, Acting U.S. Attorney Phillip A. Talbert announced.

According to court documents, between July 2017 and February 2019, Monica Nunes, 41, conspired with Johnathon Ward and Talalima Toilolo to defraud financial institutions using a scheme that exploited the merchant refund process used by businesses and retail establishments to refund customers for returns, reimbursements, and erroneous charges.

The defendants committed this scheme by stealing or purchasing point-of-sale (POS) terminals used by businesses to process bankcard transactions.  The defendants programmed each terminal to make it appear as if it was authorized by a particular retail merchant, connected the terminals to payment processing intermediaries, and executed refund transactions even though no purchases had been made.  The payment processors, falsely believing the terminals were authorized, approved the refunds and caused the merchants’ payment processors to transfer funds to the defendants’ fraudulent accounts. 

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