October 18th, 2010 
admin By Bryan Rourke
NEW HAVEN, Conn. — A Connecticut man has pleaded guilty to defrauding a Rhode Island bank out of millions of dollars.
Joseph Sarlo, 54, of Trumbull, Conn., pleaded guilty to one count of conspiracy to commit bank fraud before Judge Joan G. Margolis in U.S. District Court in New Haven on Oct. 14. The bank that Sarlo defrauded was Domestic Bank of Cranston, according to the U.S. Attorney’s Office in Connecticut. Domestic Bank is now in the process of becoming Admiral’s Bank, according to an introduction on its website .
The amount of money Sarlo took from the bank was roughly $4.8 million.
Sarlo was the chief executive officer of New England Cash Dispensing Systems (NECDS), which was based in Branford, Conn., and was in the business of operating automatic teller machines. In March 2000, NECDS entered into a contract to provide ATM services for Domestic Bank.
Between 2007 and early 2010, Sarlo admitted in court to receiving money from Domestic Bank that he was supposed to place in the banks’ ATMs but he instead diverted to NECDS.
“The cash was diverted to fund NECDS’s operations, including to pay the salaries of the co-conspirators and other employees of NECDS and to expand NECDS’s business,” said Assistant U.S. Attorney Paul Murphy in his charging document. “The purpose of the conspiracy also was to cover up the fact that funds had been diverted so that Domestic Bank would continue to supply cash for the ATM network.”
In his filing charge, Murphy asks that in addition to Sarlo being ordered to jail that he also be ordered to repay Domestic Bank its losses: $4,805,540.
U.S. District Judge Janet Bond Arterton is scheduled to sentence Sarlo on Jan. 3. Sarlo faces a maximum sentence of 30 years imprisonment.
Founded in 1967, Domestic Bank had grown to nine branches in and around Cranston.
Domestic ran into regulatory problems in mid-2008 as the bank and its mortgage subsidiary agreed to pay $1.8 million in fines after federal regulators cited the financial institution for engaging in unsound mortgage-lending practices.
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