MEMPHIS, Tenn. – Ninety-nine people have been charged with cashing more than $41,000 in checks using an illegally-obtained state of Tennessee account number, authorities said Tuesday.
Leaders of the scheme recruited others to cash checks for about $300 apiece at Wal-Marts in the Memphis area, Department of Safety and Homeland Security Commissioner Bill Gibbons said Tuesday. The ringleaders kept a portion of the money obtained from each check and gave the rest to the check cashers, he said.
Officials said the checks were made with an account number belonging to the state, but it was not immediately disclosed how members of the ring obtained the number. Gibbons said the state Department of Treasury informed law enforcement about the existence of the fraudulent checks, sparking an 11-month investigation.
The state, however, did not lose funds from the scheme, because the Federal Reserve stopped payment on the checks, which amounted to $41,208. Wal-Mart cooperated with the investigation, Gibbons said.
About 50 people had been arrested on forgery and identity theft charges as of Tuesday afternoon. More people were expected to be arrested on the same charges.
If convicted of forgery, those charged face up to six years in prison on each count, Shelby County District Attorney Amy Weirich said. An identity theft conviction could result in a sentence of up to 12 years on each count.
“This was a widespread criminal effort to cheat Tennessee taxpayers and retailers,” Weirich said.
The state Homeland Security department’s Identity Crimes Unit led the investigation. Shelby County sheriff’s deputies helped the state arrest the defendants.
