MONTGOMERY, Ala.–A former employee of IAM Community Federal Credit Union has pleaded guilty to financial institution theft, including agreeing to pay approximately $1.5 million in restitution.
Jennifer Arnette entered the plea Monday in U.S. District Court in Montgomery. Arnette was formerly a branch manager and loan officer with the credit union.
As part of her guilty plea, Arnette admitted to several means of embezzling and misapplying funds from the credit union while she worked there until March of 2013, the Dothan Eagle reported.
According to court documents quoted by the Dothan Eagle, Arnette admitted to the following actions:
- Using her position to manipulate credit scores to authorize approximately 170 automobile loan applications, causing the credit union to issue loans beyond the credit union’s accepted level of risk.
- Approving approximately 64 automobile loans wherein she inflated the value of the automobiles by listing premium options that never existed, including a premium engine, sports package, upgraded body type, theft recovery system and others. Approximately 22 of the loans were manipulated to inflate the value of the automobiles more than $5,000 each. The fraud caused IAM to issue automobile loans without sufficient collateral.
- Unilaterally increasing her personal loan limit and falsely making it appear the credit union CEO authorized the increase.
- Stealing $9,393.35 from a deceased credit union member by transferring funds from the deceased member’s account to another member’s account, then ultimately to her own personal account at another institution.
- Unlawfully withdrawing $80,000 from the IAM cash account.
The plea agreement indicates the amount of restitution owed of $1.1 million to IAM Community Federal Credit Union and $386,589.99 to CUNA Mutual Group, the Dothan Eagle reported.
Her sentence has not been set, but Arnette is due for a reduction in sentencing range for cooperating with the investigation and pleading to the offense.