HAMPTON ROADS, Va.– An attorney is offering to represent alleged victims for free in a case involving a large number of members of Navy FCU in the Hampton Roads region who were told to repay loans they said they never authorized.
In what’s being referred to as the “parking lot scam,” fraudsters approach victims in parking lots, claiming they need help. They typically ask to use the victim’s phone, then quickly access the person’s Navy Federal mobile app to take out personal loans, make withdrawals and transfer the money to their own accounts, investigators have said.
According to prosecutors, the suspects use various methods while in possession of victims’ phones, including stealing login information, creating financial disputes, making withdrawals and transferring money through Zelle, Cash App and Venmo.
The victims say they are then forced to pay back thousands of dollars.
Attorney is ‘Flabbergasted’
Attorney Gary Byler told WTKR he was “flabbergasted” after seeing a News 3 investigation about victims being required to pay back personal loans that the scammers allegedly took out.
“It’s a no-brainer. Anytime we see a bully picking on somebody, it doesn’t sit well with us,” Byler told the news outlet.
A recent federal indictment accuses 10 suspects of involvement in 33 different cases. The investigation, which began in October 2023, has documented 500 victim reports throughout Hampton Roads with losses of at least $2 million, WTKR said.
Despite reporting the fraud to Navy Federal, victims WTKR said it spoke with say they were told they had to repay the money.
One Member’s Story
Angel Taylor told WTKR that in 2023, a suspect approached her in a Walmart parking lot in Newport News with what appeared to be a crying baby in his car. He said he couldn’t find his wife and needed to call her.
“There’s a baby in his backseat and that’s crying too and I’m like yes, you can borrow my phone,” Taylor told WTKR.
Taylor said she let him use her phone and moments later, he took out a personal loan with her mobile app, then transferred the money to another account. She said she was told she had to pay back $7,000, according to the report.
The news outlet featured several other members with similar stories.
Another victim who didn’t want to be identified due to safety concerns was abducted, according to a police search warrant, WTKR reported. That person told WTKR News 3 Navy Federal denied his fraud claim “because I willingly gave up my phone.”
Three Suspects Arrested
WTKR reported that police arrested three suspects. Charges were dismissed for two of the suspects, but the preliminary hearing for the third suspect, Kymon Tyson, is set for Oct. 17 at the Virginia Beach Courthouse.
“It cannot be the rule that a bank can make a loan that you didn’t ask for, give the money to somebody you don’t know, and make you pay. Obviously, that can’t be the rule. Our banking system would collapse,” Byler said.
He acknowledged Navy Federal is also a victim but said the responsibility should not fall solely on customers who hand over their phones.
“Why it is that Navy Federal thinks those folks ought to pay for fraud perpetrated on the credit union is absolutely beyond me,” Byler said.
Navy FCU Responds
In a statement to WTKR, Navy Federal said it is “deeply concerned about these schemes and is actively cooperating with law enforcement in investigations. These cases illustrate how important it is to treat an authenticated banking app with the same level of caution as a wallet.”
Navy Federal said it has taken numerous steps to protect members, members, including member education campaigns focused on mobile device safety and scam awareness. It also encourages members to enable additional security features within payment apps—such as Face ID or biometric authentication—on platforms like Venmo, Cash App and Zelle to help prevent unauthorized access.
