Indian man pleads guilty to $17-million US bank fraud

A 52-year-old Indian national and former employee of a defunct New Jersey-based marble and granite wholesaler, admitted his role in a scheme to defraud a bank in connection with a $17 million secured line of credit, according to US Attorney Philip R Sellinger.

Nitin Vats, 52, pleaded guilty before US District Judge Susan D Wigenton to conspiracy to commit wire fraud affecting a financial institution.

Vats faces a maximum sentence of 30 years in prison and a fine of $1 million.

Between March 2016 and March 2018, the owner and employees of Lotus Exim International Inc (LEI), including Vats, conspired to obtain a $17 million line of credit from a bank through deceitful means.

The bank believed the credit was secured by LEI’s accounts receivable.

In reality, the conspirators had fabricated and inflated many of the accounts receivable, ultimately leading to LEI defaulting on the line of credit, according to the court documents.

To conceal the lack of adequate collateral, Vats devised a plan.

He created fake email addresses for LEI’s clients, allowing other employees to impersonate them when responding to enquiries from the bank and external auditors. The scheme caused the victim bank losses of approximately $17 million.

“The scheme involved numerous fraudulent accounts receivable where the outstanding balances were either inflated or entirely fabricated,” stated the court document.

Vats faces a maximum sentence of 30 years in prison and a fine of $1 million. Sentencing is scheduled for September 11, 2024.