Banker Admits Obstructing Mortgage Fraud Investigation

admin —  May 24, 2013 — Leave a comment

Karen Galo, 33, Key West, Florida, pleaded guilty to unlawfully disclosing a federal grand jury subpoena to a third party with the intent to obstruct a judicial proceeding. Galo faces a maximum penalty of 5 years in federal prison.

According to the plea agreement, on October 9, 2008, Galo, in her capacity as an officer of Key West Bank, received two federal grand jury subpoenas related to an investigation into mortgage fraud and money laundering. Galo knew the subject of the grand jury subpoenas. After receiving the grand jury subpoenas at the bank, Galo contacted the subject and sent him the subpoenas by fax.

Galo disclosed the subpoenas to the subject with the intent to obstruct the investigation being conducted in Tampa, Florida. Included with the grand jury subpoenas served on the bank was a warning letter notifying Galo that it is a federal crime to disclose a federal grand jury subpoena received by a financial institution. Galo included the letter in the fax sent to the subject, along with the two subpoenas. Two days after the subject received the grand jury subpoenas, he fled the United States.

United States Attorney Robert E. O’Neill announced the guilty plea.

This case was investigated by the U.S. Department of Homeland Security, Homeland Security Investigations. It is being prosecuted by Assistant United States Attorney Simon Gaugush.


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