Dwelling House is no more

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A Pittsburgh woman has pleaded guilty to bank fraud and money laundering for taking advantage of an online glitch that enabled her to make $1.1 million in overdraft withdrawals. Forty-six-year-old Jammie Harris learned of the glitch from another woman. That woman was indicted in January on charges that she stole more than $900,000 from Dwelling House Savings and Loan. Unfortunately, Dwelling House closed down in 2009 because it couldn’t absorb $3 million in fraud losses.

Questions:

1. How was the bank able to recover about $1 million of the stolen funds in 2009?

2. What was the mission of the savings and loan?

3. Prior to the shutdown of Dwelling House, what service was one of the regulator’s major concerns over? Discuss.

4.  In terms of accounting/finance, explain what led to the downfall of Dwelling House.

Sources:

Associated Press. (2011).Woman Admits Million-Dollar Bank Ripoff, WTAE.com, April 6 (Retrievable online at http://www.wtae.com/news/27455532/detail.html)

Grant, Tim. (2009). Dwelling House Savings’ deadline to recover $3 million nears. Pittsburgh Post- Gazette, June 28 (Retrievable online at http://www.post-gazette.com/pg/09179/980186-28.stm).