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Posted December 22, 2010 | comments Leave a comment

City man pleads guilty to federal conspiracy charge

Cabiness already convicted for running check-fraud ring

By Alex Bridges - abridges@nvdaily.com

HARRISONBURG -- A Winchester man recently convicted of running a check-fraud ring in the area in 2009 pleaded guilty Wednesday morning to a federal conspiracy charge, according to court documents.

Kenya Jamel Cabiness, 38, with a last known address of 1104 S. Loudoun St., Winchester, faces up to 30 years in a federal penitentiary for conspiring to commit wire fraud between Nov. 5, 2009, and Feb. 24, 2010, the charge states.

Cabiness appeared in U.S. District Court in Harrisonburg to enter the plea, according to a spokesman for the U.S. attorney's office. The defendant waived his right to be indicted by a grand jury and pleaded guilty to the charge, the spokesman stated via e-mail.

Cabiness already must serve nearly eight years in the state prison system for committing more than 90 offenses in Frederick County and Winchester during that same time, including forging and passing fake payroll checks and obtaining money under false pretenses.

An agreement reached between U.S. Attorney Jeb Terrien and the defendant's federally appointed counsel, Joel Hoppe, called for Cabiness to plead guilty to the charge that he conspired with other people "to devise a scheme and artifice to defraud and obtain money and property by means of false and fraudulent pretenses, representations, and promises and to transmit and cause to be transmitted by means of wire communication in interstate and foreign commerce a writing, sign, and signal for the purpose of executing such scheme and artifice."

The U.S. Secret Service Metro Area Fraud Task Force and the Winchester Police Department conducted a joint investigation into a large, counterfeit payroll check-cashing scheme that began in November 2009 and continued through February, according to a statement of facts submitted by the prosecutor's office. Cabiness made a large number of counterfeit checks on a computer and printed them on check paper using a "readily available" program called Versacheck.

"Once printed, the checks were distributed to 'runners' who took the checks to various check cashing establishments, convenience stores, grocers, WalMarts, Food Lions and other businesses," the document states. "Officers have confirmed that prior to cashing some of the fraudulent payroll checks, electronic communications took place between some of the victim businesses and a check authorization company in Florida."

Investigators identified more than 33 "runners" who passed or tried to pass fraudulent checks, according to the prosecutor. Cabiness' scheme has involved more than 10 victim businesses to date, the document states. Investigators discovered more than 14 different company names on the fake checks.

Cabiness told investigators he scanned legitimate paychecks to acquire valid routing and account information, and put these numbers at the bottom of the counterfeit document with a fictitious business name at the top, according to the prosecutor's statement.

A phone number printed under the business name linked to a prepaid cell phone Cabiness carried. If a store clerk called the number to ask about the check's legitimacy, Cabiness answered and assured the person the check was valid and money in the account would cover it, according to the statement.

Cabiness split the cash with the "runner."

Task force agents interviewed several "runners" who gave information linking Cabiness to the scheme, according to the statement.

Cabiness often ran the operation out of hotel rooms. Winchester police seized computers and other equipment, as well as a notebook containing banking information for legitimate businesses, from a room at the Shoney's Inn on Berryville Avenue.

Secret Service investigators found check-creation software and copies of the some of the fake checks victims had received.

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