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Organizer of Bank Fraud Scheme that Used Information Stolen by Wells Fargo Employees to Access Customer Accounts Pleads Guilty

Posted by Fay Arfa | Mar 22, 2016 | 0 Comments

LOS ANGELES– The lead defendant in a bank fraud case who oversaw a scheme in which Wells Fargo Bank employees stole customer account data – information that was used to impersonate customers and steal money from their accounts – has pleaded guilty to federal fraud charges.

Ronald Charles Reed, 69, of Inglewood, pleaded guilty late yesterday to felony counts of bank fraud and aggravated identity theft.

Reed was among eight defendants who were charged in two indictments returned by a federal grand jury last year (see: Three of the defendants charged in the case have not yet been identified, and authorities are seeking the public's help in identifying and apprehending the currently unknown individuals.

Reed, who is also known as “Disco Ronnie,” pleaded guilty before United States District Judge Fernando M. Olguin, who is scheduled to sentence the defendant on July 15. As a result of the guilty pleas, Reed faces a statutory maximum sentence of 32 years in federal prison.

“Schemes involving bank insiders are particularly difficult to investigate,” said United States Attorney Eileen M. Decker. “But in this case, the FBI and Secret Service diligently worked to uncover the mechanics of the scheme and those responsible for the losses suffered by the bank. I want to compliment the special agents involved in this matter, as well as Wells Fargo for cooperating in the investigation.”

When he pleaded guilty, Reed admitted that he worked with former Wells Fargo employees and the three unknown individuals in a scheme that caused Wells Fargo to suffer hundreds of thousands of dollars in losses. In his plea agreement, Reed has agreed to pay nearly $600,000 in restitution.

Reed recruited four Wells Fargo employees in 2013 and 2014, asked them to access the bank's computer records, and then purchased personal identifying information (PII) belonging to bank customers, including dates of birth, account numbers, driver's license numbers and social security numbers. With this information, the currently unidentified “runners” used fake IDs to impersonate bank customers and made substantial cash withdrawals from the customers' accounts. In some cases, the runners also used the customer's account to deposit worthless checks and receive cash back. The fraudulent transactions were made at Wells Fargo branches across Southern California and in other states, including Minnesota and Nevada.

Reed also admitted that in 2014 he purchased PII for accounts at U.S. Bank – but the information was for an undercover account and was supplied by a confidential informant who was working with law enforcement.

Three former Wells Fargo employees involved in the scheme previously also pleaded guilty and are pending sentencing. A case against one former Wells Fargo employee is still pending.

“The FBI is seeking the public's help in identifying three individuals who participated in the scheme by going into bank branches with fake IDs to illegally access customer accounts,” said FBI Assistant Director in Charge David Bowdich. “Anyone with information is urged to call the FBI's Los Angeles Field Office at 1-888-226-8443.”

This matter was jointly investigated by the Federal Bureau of Investigation and the United States Secret Service. Wells Fargo Bank fully cooperated during the investigation.

USAO – California, Central

Topic: Consumer ProtectionFinancial FraudIdentity TheftUpdated March 21, 2016

Central District of California DOJ / 16-052 / March 21, 2016

About the Author

Fay Arfa

Fay Arfa has the distinction of being Certified as a Specialist in two separate areas of law – Criminal Law as well as Appellate Law – by the California State Bar, Board of Specialization. The National Board of Trial Advocacy has also awarded her a board Certification in Criminal Trial Advocacy. ...


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