By Gina Tabonares
Variety News Staff

FIVE pieces of real property in Yigo and Piti may now be subject to forfeiture after it was determined that they were acquired using money derived from a check-kiting scheme.
The forfeiture complaint was filed by the U.S. Attorney’s Office against the five pieces of real property of Romy Miclat, the president of Information and Data Services who was involved in an alleged check-kiting scheme that defrauded Bank of Guam and Bank of Hawaii.
Miclat, who has left the island with his wife Aniceta C. Miclat, reportedly owns 9,900 of the 10,000 common shares of the corporation.
An investigation conducted by the Federal Bureau of Investigation showed that Miclat borrowed money from Wells Fargo Financial Guam Inc. on March 25 , 2002 and secured five pieces of real estate — two units at Apusento Garden, a unit at Villa Puntan Isa, a lot in Asan, Piti and a lot in Yigo.
FBI Special Agent Kenneth Klocke stated that the property was paid for monthly by Miclat at approximately $3,500.
IDS, a payroll processing company that provided employee payroll processing services to numerous small businesses and multi-national corporations on Guam and Saipan, was formed on Nov. 7, 1995.
The FBI defines check kiting as “a scheme which artificially inflates bank account balances, in accounts that are under common control, for purposes of obtaining unauthorized use of bank funds, through the systematic exchanging or swapping of checks between these accounts, in a manner which is designed to misuse the float that exists in the banking system.”
Check kiting can be prosecuted under several existing laws, including those against bank fraud and misapplication that can draw a fine of up to $1 million, imprisonment for up to 30 years, or both. In addition to the federal remedies, state law often provides for alternate civil and criminal consequences.
The IDS check-kiting scheme was discovered by Bank of Hawaii which contacted the FBI on Oct. 11, 2006.
On the same day, FBI agents executed a search warrant at IDS headquarters at 202 Farenholt Ave. Suite 242 in the Oka Plaza Building in Tamuning. Business records and computers were seized during the raid.
Klocke stated that after their review of the non-computerized records, they discovered that on Oct. 2, 2006, IDS created $1.6 million in cash that did not exist and wrote a total of nine electronic transfers into IDS’s Bank of Guam accounts.
On the same day, IDS prepared 18 checks dated Oct. 3, 2006 drawn on the Bank of Guam and deposited the 18 checks into one of IDS’s Bank of Hawaii accounts on Oct. 3, 2006.
The review further revealed that that the IDS kiting scheme had been ongoing since at least 2001.
Klocke said the fraudulent transfers were commingled with legitimate transfers and involved two kinds of floats. One float was the one-day transfers between Bank of Hawaii and Bank of Guam while the other scheme could be as much as a week, depending on how long it took the client’s employees to deposit or cash their payroll checks.
According to the FBI agent, the date reflects that the reason these check-kiting schemes were initiated and continued was to conceal the fact that IDS was taking more of the clients’ money than it was entitled to from its earned processing fees.
Klocke stated that Miclat came to the office of Josephine Mariano, Bank of Guam vice president for Branch and Central Operations Administration, on Oct. 4, 2006 and admitted that he was using floats to finance other businesses and that the floats were “in the millions.”
Mariano told Miclat that it was against the law and the IDS president acknowledged that he knew it.
The FBI agent further stated that based on a review of Miclat’s 1999 and 2000 tax returns, almost all of Miclat’s income were derived from IDS.
Klocke said Miclat directed his IDS employees to use IDS money to pay his loan, American Express credit cards and personal expenses.
Miclat reportedly used IDS money to run his brother’s computer store business, the Comp-U-Biz.
The District Court of Guam issued a scheduling notice for the forfeiture proceeding.
Interested parties are instructed to submit a proposed scheduling order before June 13 while a scheduling conference is set for June 28 at 10:30 a.m.
Meanwhile, the federal court has yet to decide whether it will grant the motion of Bank of Hawaii to transfer the civil case filed by Bank of Guam against Bank of Hawaii in relation to the check-kiting scheme.
Bank of Hawaii earlier asked the District Court of Guam to dismiss the complaint filed by Bank of Guam, saying that it was a duplicate lawsuit and should not be treated as a separate action.
In a reply to the alleged check-kiting scheme filed by Bank of Guam on April 11, attorneys for Bank of Hawaii said that a prior action involving the same parties and transactions was filed in the U.S. District Court of Hawaii on March 27.
The locally owned Bank of Guam filed a lawsuit against Bank of Hawaii to recover more than $2 million that was fraudulently transacted by IDS.