Couple loses $127,000 in retirement savings to fraud, seeks damages from Bethpage Federal Credit Union

A Locust Valley couple is suing Bethpage Federal Credit Union claiming the financial institution is refusing to restore funds to their account after fraudsters cleaned them out of $127,000 in retirement savings. 

Nicholas J. Ventresca and Michele R. Ventresca, both 70, filed suit against the credit union on May 9 in Nassau County Supreme Court. They allege that Bethpage, where they held a money market retirement savings account since 2019, failed to identify “obviously bogus” checks, resulting in the theft of  the bulk of the  funds in the account.

One of the checks had a signature that appeared to misspell Michele Ventresca's name, while another, written for $30,000, had no signature at all, according to the suit. What's more, the couple never ordered checks for the account, the suit says.

Officials with Bethpage said the checks were cashed at four other "large financial institutions," which they wouldn't name, likely electronically. Bethpage officials also said that the couple did not notify the credit union until months after the money was stolen, outside the 60-day window Bethpage members have to report fraudulent activity.

Since the checks were not deposited at Bethpage, the credit union did not see them until after the fraud report was made, Bethpage officials said.

The 60-day reporting window is standard in the banking industry, said Ian Mitchell, a certified fraud examiner and co-managing partner at Mission Omega, a fraud services firm in Chattanooga, Tenn. 

Four checks cashed

According to the Ventrescas’ complaint, unknown fraudsters submitted four bogus checks between March and April 2022. The first two were submitted on March 4, each totaling $30,000. Two more cashed between then and April 1 of last year withdrew another $67,000 from the couple’s account.

Prior to the theft, the Ventrescas had $145,355 in the account, according to court documents.

The couple uncovered the fraud and notified Bethpage, opened an online fraud ticket with the credit union and met with the manager of the Glen Cove branch “on or about July 26, 2022,” according to court documents.

The lawsuit alleges that the couple was told by the manager after a quick examination of the check images that they were counterfeits and that Bethpage “would do the right thing."

The manager disputes that account, Bethpage officials said.

"Less than 24 hours" later, the lawsuit said, the couple was sent a letter from Bethpage stating that the credit union had finished looking into the matter and that it “would not be restoring the Ventrescas’ losses.”

“Rather than peacefully enjoying their retirement years, the Ventrescas are now left in turmoil, unsure of how they will be able to afford their retirement,” the couple's attorneys, John Briody and Michael E. Catapano, wrote in the lawsuit.

The Ventrescas' lawyers declined to comment on whether the couple planned to file lawsuits against the financial institutions that cashed the checks.

Police report filed

The Ventrescas filed a police report with the Nassau County Police Department concerning the fraud at the end of July last year. The case remains open and there have been no new developments, Detective Lt. Richard LeBrun said Friday.

Officials with Bethpage said the couple had been sent monthly account statements and were subject to a membership agreement regarding the 60-day reporting window.

"It is regrettable that Mr. and Mrs. Ventresca are the victims of fraud. It is also regrettable that they did not notify us of the fraud for months,” Linda Armyn, Bethpage's chief strategy and marketing officer, said in a statement.

“We follow the banking industry's best practices regarding fraud prevention and monitoring,” Armyn said. “Like all financial institutions, we review fraud claims objectively and according to regulatory requirements, governing law, and the terms of our consumer member account agreement.”

“When fraud does occur, the affected member's timely identification of the fraud is critical to our efforts to recover lost funds,” Armyn said. 

Briody and Catapano said in the legal filing that the checks contained other “unmistakable indications of fraud.”  In addition to the missing or misspelled signatures, another check appeared to be missing the city, state and ZIP code in the payor’s address field, according to the suit.

Some funds recovered

Despite late notification of the fraud, officials with Bethpage said they have recovered around $5,400 of the funds, and are pursuing reimbursement from the institution that cashed the unsigned check. 

The Ventrescas’ lawyers said the fraud, theft and resulting dealings with the credit union have left them in “emotional distress and extreme anxiety,” court documents said.

The couple is seeking to have their $127,000 in savings restored, plus interest, attorney fees and other costs, as well as an additional $100,000 in damages. 

The Ventrescas join a growing list of fake-check victims. 

“While check usage has decreased with the adoption of digital payments, check fraud incidents have increased over the last year and continue to be a growing concern for financial institutions,” Mitchell, of Mission Omega, said in a statement.

Mitchell said that time limits on reporting fraud are common in agreements between financial institutions and consumers.  "It’s commonly stated that the customer will report discrepancies on the account within two billing cycles, which is typically around 60 days,” he said. “The expectation is that the account holder must exercise ‘ordinary and customary care’ for the account they hold at the financial institution."

But Mitchell added that institutions have a responsibility to try to detect fraud early on.   

“Banks and credit unions are expected to have safeguards in place to protect consumers using all payment methods,” Mitchell said. “For checks specifically, many fraud departments use software that looks for check anomalies and flags them for manual review, among other fraud detection methods."

When dealing with bogus checks, liability can often fall on the institution that initially cashed the check, Mitchell said. "This is because the presenting bank is generally in the best position to verify the check's authenticity and the identity of the person presenting the check."