A 60-year-old Renton woman and her two daughters pleaded guilty this week in federal court in connection with a bank-fraud scheme involving more than $2 million in student loans, according to a press release from the U.S. Department of Justice in Seattle.
Kathy L. Hardy and her two daughters, Leslie Y. Gordon, 36, and Theresa R. Hardy, 21, both of Renton, pleaded guilty on May 7 to bank fraud, according to the press release.
Also pleading guilty in the case was Katherine Fair, 37, of Seattle.
According to the press release, the four women stole identities to apply for $2.23 million in student loans. Members of the ring were arrested June 8, 2008, after being indicted for bank fraud and aggravated identity theft.
Sentencing for all four defendants is scheduled for Aug. 21, before U.S. District Judge John C. Coughenour.
The women used other people’s Social Security numbers and identification information to apply for $2,234,000 in student loans, according to the press release. The banks were defrauded of more than $722,000.
In their plea agreements, Gordon admits that she was the organizer of the bank-fraud scheme to use stolen identities to obtain student loan proceeds, according to the press release. Kathy Hardy admitted she provided the stolen identities from the medical office where she worked to facilitate the fraud, and Theresa Hardy admitted she allowed her name and bank account to be used to negotiate the checks issued by the banks, according to the press release.
The scheme began in April 2005, and over the next three years various members of the conspiracy allegedly submitted a dozen different student- loan applications using other people’s names or Social Security numbers as the borrower or the co-signer, according to the press release. The conspirators defaulted on the loans, taking the cash but never making a payment.
The loans were taken out from private student-loan companies, but were funded by banks.
The case was investigated by Social Security Administration Office of Inspector General, the Federal Bureau of Investigation, the Secret Service, the U.S. Postal Inspection Service, the Seattle Police Department and the King County Sheriff’s Office.
The case is being prosecuted by Assistant U.S. Attorneys Norman Barbosa and Aravind Swaminathan as part of the U.S. Attorney’s Office Working Group on Identity Theft.
