After more than a year of delays, a federal judge on Wednesday sentenced former Valor Federal Credit Union President/CEO Sean Jelen to more than five years and eight months in federal prison for bank fraud and attempted bank fraud.
Before the 35-year-old Jelen of Breezy Point, N.Y. was escorted out of the Scranton, Pa. federal court room to begin his prison sentence, U.S. District Court Judge Malachy E. Mannion noted the former executive’s disturbing conduct and that his criminal activities continued even after he was aware of the federal criminal investigation.
Federal investigators uncovered that in addition to embezzling more than $700,000 to pay for his credit card bills, college tuition, his spouse’s birthday party, and a golf tournament sponsorship, Jelen provided false documents to the NCUA to deflect its investigation into his activities. He also tried to steal $1.1 million by creating a forged severance contract before the board of directors fired him in August 2015.
Following his termination, the former executive impersonated his physician, psychiatrist, and a former employee in an attempt to claim disability insurance, federal prosecutors said.
His propensity to impersonate others also occurred at Valor FCU.
Jelen rigged Valor’s board of directors’ election by electing an individual only identified in court documents as R.T. But Jelen did this without R.T.’s knowledge. He also elected Suzanne Forrest to the board’s supervisory committee. However, Forrest did not exist. Jelen allegedly impersonated both Forrest and R.T. so that he could continue his fraud, according to court documents.
After Valor FCU posted net losses of $3.5 million in 2015 and $2.2 million in 2016, it was merged with the $22.8 billion Pentagon Federal Credit Union in Tysons Corner, Va., during the first quarter of 2017.
Judge Mannion ordered Jelen to pay $694,971 in restitution. The federal government is seeking to seize his Breezy Point home that Jelen bought with some the money he stole from the credit union. New York’s Multiple Listings Service estimates Jelen’s house is valued at more than $640,000.
However, Jelen legal saga is not over.
On Jan. 25, he filed a federal lawsuit in New York City claiming the U.S, Marshal Service violated his constitutional rights regarding cruel and unusual punishment, equal protection and right to legal counsel. Federal marshals arrested Jelen while he was on his hospital bed on Jan. 17 over his objections not to be released from the hospital because he claimed he was being treated for pancreatitis and other chronic health issues.
When Jelen failed to appear in court for his sentencing hearing on Jan. 5 much to the chagrin of Judge Mannion, an arrest warrant was issued of his arrest. Jelen had been hospitalized the day before his sentencing hearing.
Jelen was originally scheduled to be sentenced in November 2016, but the hearing did not take place, and it had been postponed ever since. It wasn’t until November 2017 when Jelen’s case was transferred to Judge Mannion. But his patience ran out.
“Unfortunately, for Mr. Jelen, his credibility is significantly tarnished through this entire case,” Mannion said during the Jan. 5 hearing. “We know for a fact through this case he, in the past, has authored documents and telephone calls indicating he was a doctor, in order to benefit himself or his activities in a manner that he saw to be appropriate.”
After he got the case in November, the judge said his court tried to expeditiously set it for sentence since it seemed to be continually postponed because of Mr. Jelen.
“It seems to me unusual that Mr. Jelen has so many problems that coincide so directly with dates that he’s to appear for sentencing,” Mannion said. “Maybe he just has horrible luck or maybe part of his stomach problems are being upset with the result of his activities and where that’s going to take him.”
