Man steals $1M from Seattle, Bank of America sits idly byon March 6, 2012 @ 1:49 pm (Updated: 9:44 pm - 3/6/12 )
Joseph Phan, 44, faces 67 counts of first degree theft and three counts of theft in the second degree. He is accused of stealing $1.1 million from Seattle Public Utilities between 2008 and 2010. Prosecutors allege he diverted customer checks for water main extension projects into a personal bank account.
"This defendant both presented the bill to customers and collected the payment. That's a recipe for embezzlement," said King County Prosecutor Dan Satterberg. "It was a lot easier than one would expect to steal a million dollars from the city."
Satterberg said Phan was able to open up a Bank of America account under his own name and "The City of Sea." More than 70 checks made payable to the City of Seattle or to Seattle Public Utilities were deposited into the account totaling $1,090,762.16.
"It is surprising that Bank of America would open up an account for him and accept checks made out to the City of Seattle when they are not the bank the city does business with," Satterberg told KIRO-FM. He indicated that the city may have grounds for civil action against the bank.
City Attorney Peter Holmes released a statement Tuesday saying his office plans to "pursue, swiftly and aggressively, all available legal remedies to recover stolen public assets."
To date, investigators have seized $220,000 from a BofA account in Phan's name, and are looking into the possibility that he transferred stolen money to additional accounts.
"We are working closely with police and prosecutors to make sure that Mr. Phan retains none of his ill-gotten gains," Holmes said.
Holmes' office would not speak to the legal remedies with which they plan to recover those assets, and would not confirm if they plan to seek a lawsuit against BofA.
A Bank of America spokesperson would not comment on this story except to say that they are cooperating with investigators.
Meanwhile, the city has launched a formal, independent review of SPU's financial practices in an effort to identify accounts subject to "high risk transactions."
"We need to move forward now to immediately fix this problem," said Councilwoman Jean Godden. "Ratepayers demand and deserve financial accountability from the utility. And they will get it."
Phan is being held at the King County Jail on $750,000. He faces a statutory maximum of 10 years in prison.
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