DATE: Saturday, June 21, 1997               TAG: 9706210322

SECTION: LOCAL                   PAGE: B3   EDITION: FINAL 

SOURCE: BY LYNN WALTZ, STAFF WRITER 

DATELINE: NORFOLK                           LENGTH:   56 lines

SECRET SERVICE SEEKS MEN IN COUNTERFEIT CHECK SCAM

A group of men who met as cooks in the Navy have allegedly bilked area banks of nearly $150,000 using computer-generated counterfeit checks, the U.S. Secret Service said Friday.

Three alleged ring members were indicted in federal court Thursday in the bank fraud. Four others have pleaded guilty, and more arrests are anticipated.

Most alleged ring members met on the Norfolk-based amphibious assault ship Saipan in the early 1990s, federal agent Darryl Daniels said Friday.

``These guys are smooth,'' Daniels said. ``They scan real checks into computers and alter them. They recruit guys down on their luck to cash them.''

Two of those indicted Thursday - Brian Byers and Virgil Dawson - are being sought in connection with the charges. The third, Willie Lemon, was arrested last month in Georgia.

The counterfeit checks are allegedly manufactured in Atlanta, then mailed to target cities, Daniels said. Most of the checks have been cashed in Hampton Roads, but some have also been cashed in Atlanta and Jackson, Miss.

Banks targeted have included Central Fidelity, Crestar Bank, First Union National Bank of Virginia, NationsBank and Signet Bank.

The checks are made to look like company payroll checks. First the ring gets a real check from a legitimate business. They scan it into a computer, then use graphics software to produce dozens of replicas, altering the check numbers, payee name and amount. Next, a ring member using phony identification presents the check at a branch of the bank that issued the original.

In one case, investigators say, the ring got an original payroll check by bribing an employee.

``They gave an auto body shop employee $25 worth of marijuana to borrow his check for two days,'' Daniels said. ``They photocopied it, mailed it to Atlanta and got the counterfeit checks back two days later.''

Later, the ring apparently scanned checks directly into the computer.

The counterfeit checks appear to be real and bear the photocopied signature of the person authorized to write the checks, court papers show. At least 200 bogus checks have been passed.

``The ring comes into town with the checks and goes from branch to branch until they've cashed them all,'' Daniels said. The banks pick up on the fraud when the checks are processed, because they don't bear the standard magnetized ink computers use to read them.

Byers allegedly passed about half the checks, Daniels said, frequently taking his 2-year-old son with him to help him appear legitimate. Byers allegedly recruited others, paying them between $100 to $300 for every check cashed.

Lemon allegedly supplied the checks to Byers. ILLUSTRATION: Photos

Brian Byers of Tennessee and Virgil Dawson of Chesapeake are sought

on counterfeit check charges. Call Special Agent Darryl Daniels

with information at 441-3200. KEYWORDS: FRAUD COUNTERFEIT CHECK U.S. SECRET SERVICE

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