Newport Attorney Gets Jail in Check-Kiting Scheme

A Newport Beach attorney was sentenced to 270 days in
jail and ordered to pay $90,000 in restitution for stealing more than $90,000 in a check-kiting scheme, according to prosecutors.

Herbert Robert Schnapp, 65, of Newport Beach pleaded guilty May 23 to grand theft and four counts of writing bad checks, all felonies, according to the Orange County District Attorney's Office.

Schnapp had two bank accounts, one at a Wells Fargo branch in Newport Beach, and another at LBS Financial Credit Union in Long Beach.

From August 2005 to March 2006, Schnapp would make deposits almost every day into each account by writing checks to himself from the other bank, according to prosecutors. He deposited 261 fraudulent checks for more than $6 million between the two accounts, which appeared to have high balances because of the scheme, prosecutors said.

Schnapp did not have the money to cover the checks, but he withdrew cash anyway. Schnapp stole more than $90,000 and spent it on personal and professional expenses, prosecutors said.

Suspicious credit union managers in March 2006 put a hold on two checks deposited into their account from the Wells Fargo account, leading to an overdraw of the Wells Fargo account. Both accounts were closed and bank officials called Newport Beach police.

—City News Service