Rapid City Man Sentenced for Bank Fraud and Money Laundering

Summary

Steven Arthur Knigge, 77, of Rapid City, South Dakota, was sentenced on July 2, 2024 by Chief Judge Roberto A. Lange to 33 months in federal prison and three years of supervised release on three counts of bank fraud and three counts of money laundering, the U.S. Attorney's Office for the District of South Dakota announced on July 10, 2024. Beginning in April of 2021 and continuing through April of 2022, Knigge deposited seven fraudulent checks totaling approximately $200,000 at institutions including Wells Fargo Bank and Med5 Federal Credit Union. In April of 2021 Knigge also sought $20,833 through a Paycheck Protection Program application for a residential remodeling business that Knigge never owned, supported by fraudulent banking and Form W-2 documents. The court ordered restitution of $20,833 to the Treasury, $6,140 to Wells Fargo Bank and $225 to Med5 Federal Credit Union.

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Press Release

Rapid City Man Sentenced for Bank Fraud and Money Laundering

Wednesday, July 10, 2024

For Immediate Release

U.S. Attorney's Office, District of South Dakota

RAPID CITY - United States Attorney Alison J. Ramsdell announced today that Chief Judge Roberto A. Lange, U.S. District Court, has sentenced a Rapid City, South Dakota, man convicted of three counts of Bank Fraud and three counts of Money Laundering. The sentencing took place on July 2, 2024. Steven Arthur Knigge, 77, was sentenced to 33 months in federal prison, followed by three years of supervised release, and ordered to pay a $600 special assessment to the Federal Crime Victims Fund, $20,833 in restitution to the United States Department of Treasury, $6,140 in restitution to Wells Fargo Bank, and $225 in restitution to Med5 Federal Credit Union. Knigge was indicted on five counts of Bank Fraud, eight counts of Money Laundering, and one count of Wire Faud by a federal grand jury in July of 2022. He pleaded guilty on February 7, 2024. Beginning in April of 2021 and continuing through April of 2022, Knigge devised a scheme to defraud several banking institutions for his own personal gain, including Med5 Federal Credit Union, Wells Fargo Bank, Black Hills Federal Credit Union, and Highmark Federal Credit Union. As part of his scheme, Knigge deposited seven fraudulent checks totaling approximately $200,000 knowing the checks were fraudulent. Knigge then transferred a portion of the fraudulent funds to another account or withdrew cash before the banks were able to determine the funds were fraudulent. In April of 2021, Knigge also submitted a fraudulent Paycheck Protection Program (PPP) loan application requesting $20,833 of government funds. In the PPP application, Knigge claimed he owned and operated a residential remodeling business. However, Knigge never owned or operated a residential remodeling business, and the investigation showed the banking and Form W-2 documents that were submitted in support of the application were fraudulent. Knigge received the PPP funds and then immediately withdrew nearly the entire amount in cash. “IRS Criminal Investigation (CI), in conjunction with our law enforcement partners, continues to actively pursue and prosecute those who abused the COVID pandemic relief programs and hold them accountable for defrauding the government,” said Special Agent in Charge Thomas F. Murdock, St. Louis Field Office. “Mr. Knigge, a former fraud investigator for the South Dakota Dept. of Revenue, admitted he submitted a fraudulent PPP application for personal gain, knowing he wasn’t entitled to those funds.” This case was investigated by the Internal Revenue Service-Criminal Investigation. Assistant U.S. Attorney Benjamin Patterson prosecuted the case. Knigge was immediately remanded to the custody of the U.S. Marshals Service.

Updated July 10, 2024

Topics

COVID-Related Fraud

Financial Fraud

Component

USAO - South Dakota

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