Pittsford woman pleads guilty to $20M check kiting scheme

Pittsford resident, Katherine Mott-Formicola has pleaded guilty to financial institution fraud and money laundering. 

According to Assistant U.S. Attorney Nicholas Testani, Mott-Formicola was a controlling member of several business entities, operating 10 business accounts at Five Star Bank and seven business accounts at Kinecta Federal Credit Union. Between November 29, 2022, and March 11, 2024, Mott-Formicola perpetrated a “check-kiting” scheme by sending hundreds of checks between the various bank accounts for the purpose of fraudulently inflating the balance of the accounts. 

Testani, who is handling the case, says Mott-Formicola schemed $20,907,000 from the financial institutions. During the course of the scheme, Mott-Formicola intentionally kited over 500 overvalued checks between her various bank accounts for the purpose of over-inflating her accounts,” Testani said. “Furthermore, because the inflated account balance would only last until the depositing institution eventually discovered that the withdrawing account had insufficient funds, Mott-Formicola would kite additional checks into the withdrawing accounts to allow the scheme to continue without detection.” 

Mott-Formicola spent the $20,907,000 on her various business ventures and personal items, such as real estate. Five Star Bank was able to recover some funds, suffering a loss of $18,979,005.79. This crime carries a maximum penalty of 30 years in prison and a fine of $1,000,000. 

The plea involving Mott-Formicola is the result of an investigation by the Federal Bureau of Investigation, the Internal Revenue Service Criminal Investigation, and the New York State Department of Financial Services. 

Sentencing is scheduled for May 1, 2025, before Judge Geraci.