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The former CEO of Richmond City Employees Federal Credit Union was charged last week with two counts of bank fraud.According to court documents, Daniel Johnson allegedly falsified loan applications to secure hundreds of thousands of dollars from the credit union for his own personal use.U.S. Attorney Zachary Myer’s office said in the documents that Johnson’s alleged scheme took place between August 5 and September 16, 2021.Johnson is accused of creating two additional member accounts with the credit union to submit fraudulent applications for secured loans, each in the amount of $150,000. The loans were secured for the purpose of purchasing two vehicles that would be used as collateral for the loans, but officials allege that Johnson never intended to purchase those vehicles.”Through his scheme, Johnson obtained what in effect were unsecured loans totaling approximately $300,000, which he used to pay personal debt and expenses,” Myers’ office said in the documents.Johnson allegedly falsified records to show that the credit union’s board of directors had approved the loans, which did not occur.The alleged scheme resulted in a loss to the credit union of more than $275,000.Johnson faces two counts of bank fraud, which each carry a maximum penalty of 30 years in prison and a fine of $250,000 or twice the loss caused by the offense, whichever is greater.In 2022, Richmond City Employees Federal Credit Union was placed into conservatorship by the National Credit Union Administration in response to “unsafe and unsound practices at the credit union.” The NCUA did not provide specific details of those practices, and it is not clear if the conservatorship move was related to Johnson’s alleged actions.The credit union was acquired by Ohio-based Kemba Credit Union in 2023.The charges were filed in the U.S. District Court for the Southern District of Indiana on March 14. That same day, a signed plea agreement was also filed in which Johnson has agreed to plead guilty.The agreement notes that a specific sentence has not been agreed upon by the parties involved. However, it does say that the court shall order Johnson to pay more than $285,000 in restitution to Kemba Credit Union, in addition to any fines deemed appropriate by the judge.Johnson is set to appear in court in Indianapolis on March 26.
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