Two Illinois men, Erik Richard Jones and Mitchell Allen Melega, were sentenced to prison for bank fraud and money laundering. They have been ordered to pay nearly $4.84 million in restitution for defrauding First Midwest Bank and misusing loan funds. The sentences were given in Rock Island after they pleaded guilty to several charges.
On July 23, 2024, Erik Jones from Colona was sentenced to 54 months in prison and five years of supervised release. Mitchell Melega, formerly from Orion, received 75 months in prison and five years of supervised release. Both were ordered to pay $4,840,944.63 in restitution.
The government presented evidence that between 2016 and 2017, Jones and Melega submitted false documents to First Midwest Bank in Moline to obtain loans for I-80 Equipment in Colona, which they used to purchase vehicles and make improvements. Jones owns I-80 Equipment, and Melega was the Controller. They diverted funds for unauthorized uses and instructed employees to provide false information to support their scheme. They also misused real estate loans from Northwest Bank in Davenport, Iowa, meant for renovating an apartment complex Jones had purchased, to pay off unrelated loans for Jones’s family and other business expenses of I-80 Equipment.
The scheme involved altering legitimate documents and creating fake ones, including purchasing at least 110 vehicles over time. Judge James E. Shadid described the scheme as “particularly sophisticated.”
“Our office is dedicated to prosecuting serious financial crimes,” said U.S. Attorney Gregory K. Harris. “Actions like those of 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.”
Jones and Melega were charged in October 2020 in a twelve-count indictment. The charges included conspiracy to commit bank fraud, bank fraud, and money laundering. Jones pleaded guilty in September 2023 to all counts, and Melega pleaded guilty in March 2024 to the same charges.
“The defendants have been brought to justice for defrauding First Midwest Bank and using the obtained funds for unauthorized purposes,” said Vincent R. Zehme, Special Agent in Charge 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 ensure those who engage in bank fraud and money laundering are thoroughly investigated and brought to justice.”
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“The FBI, working with our federal and state partners, will vigorously investigate to uncover the truth and deliver accountability whenever anyone defrauds U.S. banks,” said FBI Special Agent in Charge Christopher Johnson. “The FBI remains committed to safeguarding our economic security from threats which could harm American institutions.”
