Two Illinois men, Erik Richard Jones and Mitchell Allen Melega, were sentenced to prison after being convicted of bank fraud and money laundering. They were also ordered to pay nearly $4.84 million in restitution for defrauding First Midwest Bank and misappropriating loaned funds. The sentences were handed down in Rock Island, following their guilty pleas to multiple charges. On July 23, 2024, Erik Jones, of Colona, was sentenced to 54 months in prison followed by five years of supervised release. Mitchell Melega, formerly of Orion, was sentenced to 75 months in prison, followed by five years of supervised release. They were both ordered to pay $4,840,944.63 in restitution.
The government presented evidence that between 2016 and 2017, Jones and Melega provided false documents to First Midwest Bank in Moline to obtain loans for I-80 Equipment in Colona to purchase vehicles and make improvements. Jones owns I-80 Equipment and Melega is the Controller. The duo diverted funds for unauthorized uses and directed employees of the business to provide false information to support the scheme to defraud. They also diverted real estate loans from Northwest Bank in Davenport, Iowa, that were intended to make renovations to an apartment complex Jones had purchased, to pay off unrelated loans for Jones’s family members and other unrelated business expenses of I-80 Equipment.
The scheme involved altering legitimate documents and completely fabricating false documents, which included purchasing at least 110 vehicles, over an extended period of time. According to the release, Judge James E Shadid found the scene “was particularly sophisticated.”
“Our office is dedicated to prosecuting these serious financial crimes,” said U.S. Attorney Gregory K. Harris. “Actions like the defendants’ cause significant harm to banks and undermine the stability of our financial system. We are grateful to our federal and local law enforcement partners for their commitment to these investigations and cases.”
Both men were charged in October 2020 in a twelve-count indictment. They were charged with conspiracy to commit bank fraud, (Count 1); bank fraud (Counts 2 through 9); and money laundering (Counts 10 through 12). Jones pleaded guilty in September 2023 to all counts of the indictment, and Melega pleaded guilty in March 2024 to the same charges.
“The defendants in this case have been brought to justice for defrauding First Midwest Bank and using the obtained funds for unauthorized purposes,” said Special Agent in Charge Vincent R. Zehme, of the Federal Deposit Insurance Corporation Office of Inspector General (FDIC OIG), Chicago Region. “The FDIC OIG will continue working with our law enforcement partners to hold individuals accountable who commit such fraudulent offenses and threaten to undermine the integrity of our Nation’s banks.”
“This sentence should serve as a warning to any potential fraudsters who think they can defraud banks and get away with it,” said IRS Criminal Investigation (CI) Special Agent in Charge Thomas F. Murdock. “The collective efforts of IRS CI, the FDIC-OIG, and the U.S. Attorney’s Office can follow the money trail and ensure those who engage in bank fraud and money laundering are vigorously investigated and brought to justice.”
“The FBI, working with our federal and state partners, will vigorously investigate to uncover the truth and deliver accountability anytime anyone defrauds U.S. banks,” said Special Agent in Charge Christopher Johnson. “The FBI remains committed to safeguarding our economic security from threats which could cause harm to American institutions.”