Vanguard supervisor sentenced to four years for fraud

Scott Capps siphoned off $2.1 million from dormant accounts: Feds

Aug 23, 2019 @ 12:47 pm

By Bruce Kelly

This story has been updated to include information from an article posted Sept. 16 by the Philadelphia Inquirer.

A former employee of the Vanguard Group was sentenced to four years in prison yesterday for a $2.1 million fraud scheme he perpetrated while working at the company.

Scott Capps, 48, pleaded guilty in March to charges of mail fraud, money laundering and filing a false tax return, according to a statement from the U.S. Attorney's Office in Philadelphia. He will also forfeit $649,000.

Between 2011 and 2014, Mr. Capps worked at Vanguard as a supervisor, according to his indictment from 2018. He admitted that through his employment he had access to dormant accounts that were due for escheatment, which is the process of turning over abandoned funds to the state.

The defendant stole the passwords of subordinates and entered those passwords to access the system used to issue checks; he then submitted requests to have checks issued on certain dormant accounts to a co-conspirator, according to the U.S. Attorney's Office.

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After depositing the checks into his own account, the co-conspirator issued to Mr. Capps checks drawn on one of his accounts. Vanguard made all individual accounts whole after Mr. Capps' crimes were detected, according to the statement. He also filed false tax returns that failed to report income from the scheme, according to the U.S. Attorney's Office.

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A spokeswoman for Vanguard did not return a call for comment.

In an interview published Sept. 16 by the Philadelphia Inquirer, Mr. Capps detailed the ups, downs and frustrations of his career at Vanguard and how that led to his thefts from the dormant accounts.

"I stole $2.1 million, because I was [upset], because of what happened to my career," Mr. Capps told the Inquirer.

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