Dwight L. McKenna and Beverly S. McKenna - Page 8

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            changed that practice in 1987 when he began transacting business                            
            at the Read Branch of First Federal, primarily with two tellers,                            
            Marilyn Clark and Ann Hattier, who both knew him as a customer                              
            and as a member of the bank's board of directors.  Petitioner                               
            usually visited the Read Branch three or four times each week.                              
            On each occasion he would bring in a group of third party checks                            
            made payable to him.  He would tell either Ms. Clark or Ms.                                 
            Hattier that he wanted to exchange the checks for a First Federal                           
            bank check, but he did not want them or cash deposited to his                               
            checking account.  A First Federal bank check was one that was                              
            drawn on the bank's own account.                                                            
                  To exchange the third party checks for bank checks, the                               
            teller would add the amounts of the checks, determine a total,                              
            and deposit them to the First Federal suspense account, not to                              
            petitioner's checking account.  She would then issue a First                                
            Federal bank check in the same amount as the total of the third                             
            party checks.  This procedure was followed each time the teller                             
            issued a First Federal bank check to petitioner.  By exchanging                             
            the third party checks for bank checks in this manner, the total                            
            amount of the third party checks or the bank check would not be                             
            reflected in petitioner's bank account or in his bank statement.                            
            Of all the First Federal bank checks the tellers issued to                                  
            petitioner, only one was ever brought back to the teller for                                
            deposit to his checking account or to be cashed.                                            






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Last modified: May 25, 2011