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Burlco man accused of $8.8M check-kiting scheme

A Burlington County man was arrested Tuesday for allegedly running a large-scale check-kiting scheme that racked up $8.8 million in losses to three South Jersey-area banks.

A Burlington County man was arrested Tuesday for allegedly running a large-scale check-kiting scheme that racked up $8.8 million in losses to three South Jersey-area banks.

Federal officials charged 71-year-old Luis G. Rogers Sr., of Beverly, with one count of bank fraud. Rogers was taken into custody at a Mount Holly address associated with office equipment leasing company Lease Group Resources Inc., court records indicate.

Rogers served as CEO of Lease Group Resources Inc. and principal of several other business entities, prosecutors said. From November 2012 through April 2013, he allegedly controlled numerous business-related checking accounts at Liberty Bell Bank, Roma Financial and Susquehanna Bank.

Prosecutors said that, during that time, Rogers cooked up a check-kiting scheme to artificially inflate the accounts' balances. He would allegedly cause checks to be written against the accounts while knowing the cash was not there to cover them.

After the checks were deposited but before they cleared, Rogers took advantage of the temporarily available funds by writing additional checks and depositing them in other business accounts to cover more checks that were about to bounce, prosecutors said.

Rogers is accused of, over a period of six months, causing more than $776 million to be deposited into the various business accounts, an amount prosecutors claim far exceeds the businesses' annual revenues. Some months, more than 99 percent of those deposits came from other accounts controlled by Rogers, court documents claim.

After discovering the scheme last April, the banks returned or dishonored many of the pending checks and charged back the amounts written against the business accounts Rogers controlled, prosecutors said.

As a result, the accounts became overdrawn, resulting in $3.7 million in losses to Liberty Bell Bank, $2.1 million in losses to Roma Bank and $3 million in losses to Susquehanna Bank, officials said.

A judge on Tuesday released Rogers on $100,000 unsecured bond after he made an initial appearance in federal court in Trenton. He is required to surrender his passport, to remain within the country and to report to pretrial services, court documents state.

If convicted of the bank fraud charge, Rogers faces a maximum possible penalty of 30 years in prison and a $1 million fine.