A former Washington Mutual executive pleaded guilty in federal court in Bridgeport, Conn., Monday to accepting an illegal kickback.
Michael Gesimondo of Washington Mutual Bank received kickbacks from Oxford Collection Agency as a reward for providing Oxford with WaMu's debt-collection business between May 2008 and May 2009, according to a Justice Department release.
The kickbacks occurred while Gesimondo was employed as collection manager of business banking at WaMu, the release said. Gesimondo, 57, of Farmingdale, N.Y., was in charge of outsourcing collection accounts to collection agencies. The release also stated that Gesimondo often received a percentage of the collected-debt amount.
Gesimondo pleaded guilty to one count of conspiracy to accept money as a reward in connection with a business transaction of a bank, the release said. U.S. District Judge Stefan R. Underhill scheduled sentencing for April 4. Gesimondo faces a maximum sentence of imprisonment for five years.
Oxford Collection Agency was a private financial services company with offices in New York, Pennsylvania and Florida. From 2007 to 2011 its executives took part in a scheme to defraud its lender, investors and clients, the press release said, citing court documents and statements made in court. The investigation also revealed that Oxford was "actively involved in bribing" banking officials, the release said.
Seven other individuals have been convicted as a result prosecution of criminal activity arising from Oxford Collection Agency and the debt-collection industry, the release said. Washington Mutual received funds through the Troubled asset Relief Program.