Two men arrested over alleged $3.7m bank debit fraud using stolen identities

Creating businesses that exist only on paper can provide an appearance of legitimacy, but federal prosecutors allege that two men used fictitious companies and stolen identities to carry out a multimillion-dollar financial fraud scheme. The alleged operation involved setting up shell companies in other people's names, registering accounts with payment processors and initiating unauthorised withdrawals from third-party bank accounts. Investigators say the scheme attempted to obtain approximately $3.7 million over five years.

According to a November 10, 2026, announcement by the US Attorney's Office for the Southern District of New York, Paris Baker and Michael Sullivan were arrested in connection with the alleged operation. Baker was arrested in Thousand Oaks, California, while Sullivan was taken into custody in Calumet City, Illinois. Both men face federal charges involving wire fraud, access device fraud, money laundering and aggravated identity theft.

How the alleged fraudulent payment scheme worked

According to the criminal complaint, Baker, Sullivan and others participated in the scheme between approximately 2019 and 2024. They allegedly established fictitious business entities using the identities of people whose personal information had been stolen. The individuals behind the operation then created accounts for these companies with at least three payment processors. One of the processors was based in Rockland County, New York. Using these accounts, the defendants allegedly initiated unauthorised debits from other people's bank accounts. The transactions were presented as payments for services supposedly provided by the shell companies, giving the withdrawals the appearance of legitimate business payments. The payment processors cleared hundreds of thousands of dollars in transactions initiated through the fictitious entities and transferred the money into bank accounts controlled by the companies. Prosecutors allege that Baker, Sullivan and other participants subsequently spent the money or moved it into additional accounts under their control.

Six fictitious companies allegedly used

Investigators identified at least six shell entities allegedly involved in the operation. These included Sebi Property Management, Sada Property Group, Vollen Medical Center, Acclimate Property Management, Majani Wellness Center and Fruitive Medical & Rehab Center. Despite their business-like names, prosecutors allege that none of these companies conducted legitimate commercial activities or had genuine customers. The identities used to establish the companies belonged to victims of identity theft. The alleged arrangement allowed the participants to create the appearance of established businesses while using payment-processing systems to withdraw money from unrelated bank accounts. According to the Justice Department, the defendants and their alleged associates attempted to defraud victims of approximately $3.7 million. The defendants and their alleged associates successfully obtained at least $1.3 million in fraudulent proceeds, according to prosecutors. The distinction between the two figures is significant. The $3.7 million represents the amount they allegedly attempted to obtain, while $1.3 million refers to the money prosecutors say was actually secured through the scheme.

Federal charges and possible prison sentences

Baker, 38, of Chicago, Illinois, and Sullivan, 50, of Calumet City, Illinois, have each been charged with wire fraud and conspiracy to commit wire fraud, which carry maximum prison sentences of 20 years. They also face charges of access device fraud and conspiracy to commit access device fraud, carrying maximum sentences of 15 years, as well as conspiracy to commit money laundering, which carries a maximum sentence of 20 years. Both men are additionally charged with aggravated identity theft, an offence carrying a mandatory minimum prison sentence of two years. The Justice Department clarified that the potential sentences are determined by federal law and that any eventual punishment will be decided by the judge.

Investigation and federal response

The investigation involved the FBI's New York Field Office and its Westchester County Resident Agency. Authorities also received assistance from federal prosecutors and law enforcement agencies in Illinois and California, along with the Illinois Attorney General's Office and local police departments. US Attorney Jamie McDonald said the alleged scheme exploited financial systems designed to facilitate legitimate commercial transactions. FBI Assistant Director in Charge James C. Barnacle Jr. described the investigation as a five-year wire fraud operation and emphasised efforts to trace the money and identify those responsible. The case is being prosecuted by the White Plains Division of the US Attorney's Office, with Assistant US Attorneys Ioannis Drivas and Daniel Listwa handling the prosecution. The charges are allegations, and both defendants are presumed innocent unless and until proven guilty in court.