Boston, MA... A former bank branch manager was charged today in federal court with misapplication and embezzlement of more than $650,000 from the Hudson Savings Bank.

United States Attorney Michael J. Sullivan; Kenneth W. Kaiser, Special Agent in Charge of the Federal Bureau of Investigation in New England; and Sara Gibson, Assistant Inspector General for the Federal Deposit Insurance Corporation’s Office of Inspector General, announced today that MILTON J. PEREIRA, age 38, of 45 Vega Drive, Shrewsbury, Massachusetts, was charged in an Information with two counts of misapplication and embezzlement of funds from the Hudson Savings Bank.

The Information alleges that PEREIRA was employed by the Hudson Savings Bank from March 1998 through August 2005, and was at different times the Branch Manager of the bank’s Marlborough and Hudson branch offices. According to the Information, over a five year period, PEREIRA tampered with more than 60 customers’ accounts at the Bank, performing or authorizing hundreds of credits and debits, and causing a loss to the Bank of more than $650,000.

The Information alleges that PEREIRA withdrew funds from existing customers’ deposit accounts and from active or inactive home equity lines of credit, and he also created false accounts from which he withdrew funds. PEREIRA is alleged to have avoided detection of his actions by repaying credit lines from other customers’ accounts, taking steps to prevent customers from receiving account statements for periods of time, creating false loan statements which were sent to customers, and changing the mailing addresses on loan accounts to addresses controlled by PEREIRA.

According to the Information, when customers became aware of unauthorized activity in their accounts, PEREIRA corrected the account by depositing funds from other customers’ accounts, sent a letter to the customer reporting that there had been an “error” in the account, and made a notation in the bank’s internal data system that the account had been fixed and the customer notified.

If convicted, PEREIRA faces up to 30 years’ imprisonment, to be followed by 5 years of supervised release, and a $1 million fine on each of the counts.

The case was investigated by the Federal Bureau of Investigation, the Federal Deposit Insurance Corporation’s Office of Inspector General and the Hudson Police Department. It is being prosecuted by Assistant U.S. Attorney Mark J. Balthazard in Sullivan’s Economic Crimes Unit.

The details contained in the Information are allegations. The defendant is presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

Press Contact: Samantha Martin, (617) 748-3139