Former Employee of Defunct New Jersey Marble and Granite Company Admits Participating in $17 Million Bank Fraud

NEWARK, N.J. - A former employee of a now-defunct New Jersey-based marble and granite wholesaler today admitted his role in a scheme to defraud a bank in connection with a $17 million secured line of credit, U.S. Attorney Philip R. Sellinger announced.

Nitin Vats, 52, an Indian national, pleaded guilty before U.S. District Judge Susan D. Wigenton to count one of an indictment charging him with conspiracy to commit wire fraud affecting a financial institution.

According to documents filed in this case and statements made in court:

From March 2016 through March 2018, an owner and employees of Lotus Exim International Inc. (LEI), including Vats, conspired to obtain from the victim bank a $17 million line of credit by fraudulent means. The victim bank extended LEI the line of credit, believing it to have been secured in part by LEI's accounts receivable. In reality, the conspirators had fabricated and inflated many of the accounts receivable, ultimately leading to LEI defaulting on the line of credit.

To conceal the lack of sufficient collateral, Vats created fake email addresses on behalf of LEI's customers so that other LEI employees could pose as those customers and answer the victim bank's and outside auditor's inquiries about the accounts receivable. The scheme involved numerous fraudulent accounts receivable where the outstanding balances were either inflated or entirely fabricated. The scheme caused the victim bank losses of approximately $17 million.

The count of conspiracy to commit wire fraud affecting a financial institution to which Vats pleaded guilty carries a maximum potential penalty of 30 years in prison and a fine of $1 million. Sentencing is scheduled for Sept. 11, 2024.

U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark, with the investigation leading to today's guilty plea.

The government is represented by Assistant U.S. Attorney Sammi Malek of the U.S. Attorney's Office National Security Unit in Newark.