An East Mount Airy resident is one of two men charged by a federal grand jury in Delaware in an alleged scheme to bilk Citigroup out of $2.9 million.

In an indictment unsealed yesterday, Eugene "Putt" Watson, 30, of Provident Street near Wadsworth Avenue, and Keith Singleton, 41, of Schwenksville, Montgomery County, are charged with conspiring with an employee of Citigroup's loan-operations department to defraud the banking giant.

Authorities said that the insider, a woman named "C.S.," was responsible for ensuring that payments received by Citigroup from borrowers regarding certain loans were properly transferred from a Citigroup account into the bank accounts of other participants involved in the loans.

According to the indictment, from December 2006 until March 2007, "C.S.," Watson and Singleton agreed that C.S. would send 21 wire transfers totaling $2.9 million to bank accounts held in Watson's or Singleton's names, by Singleton's business, or in the names of their associates.

The indictment said that Watson and Singleton provided "C.S." with bank-account numbers needed to facilitate the wire transfers. The charging papers said that the trio split the proceeds of the alleged fraud.

Authorities said that Watson and Singleton had given "C.S." financial benefits to encourage her participation in the scheme, including cash; checks made out to her, her family and friends; and access to accounts from which she could make personal purchases.

Watson and Singleton used some of the alleged fraud proceeds for their own benefit, including purchases of luxury items and to pay off personal debts, the feds charged.

Watson, who is being held at Curran-Fromhold Correctional Facility, on State Road, on unrelated state charges, is scheduled for a Jan. 7 hearing in federal court in Wilmington.

He is scheduled to stand trial Dec. 28 in Philadelphia Common Pleas Court on firearms and related offenses, court records show. He was convicted in September 2005 in Common Pleas Court of drug charges and sentenced to one to two years in prison and a year of probation.

Singleton, who was arrested Dec. 15, is scheduled for a detention hearing this morning in federal court in Wilmington.

"C.S." has been charged separately.