Two Charged in $3.7M Shell-Company Debit Fraud

NEW YORK, N.Y. — Two Illinois men were arrested on November 10, 2026, on federal charges alleging they ran a shell-company scheme that attempted about $3.7 million in unauthorized bank debits using the names of identity theft victims, the U.S. Attorney's Office for the Southern District of New York announced.

Read the U.S. Attorney's Office release: https://www.justice.gov/usao-sdny/pr/two-defendants-charged-fraudulent-payment-and-identity-theft-scheme

United States Attorney Jamie McDonald and FBI Assistant Director in Charge James C. Barnacle, Jr. announced the arrests.

Paris Baker, 38, of Chicago, Illinois, was arrested on the morning of November 10, 2026, in Thousand Oaks, California, and was expected to be presented in Los Angeles federal court that afternoon, according to the release.

Michael Sullivan, 50, of Calumet City, Illinois, was arrested in Calumet City and was presented in Chicago federal court on the morning of November 10, 2026, according to the release.

Paper Companies, Stolen Identities, Unauthorized Debits

According to the Complaint, between about 2019 and 2024, Baker, Sullivan and others incorporated shell entities in the names of victims of identity theft.

The defendants then created accounts for the shell entities with at least three payment processors, one of which was based in Rockland County, New York, according to the release.

According to the release, they initiated unauthorized debits of third parties' bank accounts, purportedly in payment for services rendered by the shell companies.

None of the entities conducted any legitimate business or had any genuine customers, according to the release.

Six Shell Entities, $3.7 Million Attempted, $1.3 Million Obtained

Investigators said the scheme attempted to defraud victims of at least about $3.7 million and successfully procured at least about $1.3 million in fraudulent proceeds, according to the release.

Hundreds of thousands of dollars in unauthorized transactions were cleared by the payment processors into bank accounts controlled by the shell entities and were then spent or transferred to other accounts under the defendants' control, according to the release.

The release named six fictitious shell entities: Sebi Property Management, Sada Property Group, Vollen Medical Center, Acclimate Property Management, Majani Wellness Center, and Fruitive Medical & Rehab Center.

"Paris Baker and Michael Sullivan allegedly created businesses that existed only on paper, using stolen identities to give their scheme the appearance of legitimacy while initiating millions of dollars in unauthorized bank transactions," said U.S. Attorney Jamie McDonald.

"Baker and Sullivan allegedly stole millions of dollars over the course of a five-year wire fraud scheme," said FBI Assistant Director in Charge James C. Barnacle, Jr.

FBI

Investigation, Two Court Appearances, Charges Filed

Paris Baker: Wire fraud and conspiracy to commit wire fraud; access device fraud and conspiracy to commit access device fraud; conspiracy to commit money laundering; aggravated identity theft.

Michael Sullivan: Wire fraud and conspiracy to commit wire fraud; access device fraud and conspiracy to commit access device fraud; conspiracy to commit money laundering; aggravated identity theft.

Wire fraud and conspiracy to commit wire fraud each carry a maximum sentence of 20 years in prison, according to the release.

Access device fraud and conspiracy to commit access device fraud each carry a maximum sentence of 15 years in prison, according to the release.

Conspiracy to commit money laundering carries a maximum sentence of 20 years in prison, and aggravated identity theft carries a mandatory minimum sentence of two years in prison, according to the release.

Any sentencing, if the defendants are convicted, will be determined by the judge, the release said.

The FBI's New York Field Office, Westchester County Resident Agency, investigated the case, with assistance from the U.S. Attorney's Offices for the Northern District of Illinois and the Central District of California, the FBI's Chicago and Los Angeles Field Offices, the Illinois Attorney General's Office, the Palos Heights Police Department, and the Chicago Police Department, according to the release.

Assistant U.S. Attorneys Ioannis Drivas and Daniel Listwa of the Office's White Plains Division are prosecuting the case, according to the release.

The charges in the Complaint are allegations only, and the defendants are presumed innocent unless and until proven guilty.

Anyone with information about financial fraud can contact the FBI or submit a tip through the FBI's tip line.

Sources

U.S. Attorney's Office, Southern District of New York, Official Press Release No. 26-324, "Two Defendants Charged In Fraudulent Payment And Identity Theft Scheme," November 10, 2026.