Money Orders

A court-appointed receiver will begin trying to restore money to hundreds of customers of United Express Money Order Co. of Long Beach, a firm that the state shut down this week after finding that it lacked funds to pay for money orders its agents had issued.

Money-transfer company MoneyGram International Inc. had a near-death experience as one of the more unlikely victims of the mortgage meltdown. Pummeled by losses starting in 2007 on mortgage-related investments, it stayed afloat when private equity fund Thomas H. Lee Partners and Wall Street titan Goldman Sachs Group Inc. swooped in, provided an infusion of cash and took control in 2008. Shareholders in MoneyGram, based in Dallas, recently approved a deal that analysts say is a step toward the eventual exit of Lee Partners and Goldman.

A 29-year-old North Hollywood man was sentenced to 30 days on a Caltrans work crew for trying to cash $1,200 in money orders stolen during the Los Angeles riots, the city attorney's office said Thursday. Shabtay Bittay was sentenced after he pleaded no contest to trying to pass worthless and illegal money orders, said Mike Qualls, spokesman for the city attorney. Bittay, a North Hollywood laborer, was also placed on two years probation, he said.

A business inadvertently gives you counterfeit money — are you stuck with it? In most cases, yes. But what if that business happens to be a branch of the federal government? Los Angeles resident David Lipin found himself asking this question the other day after he cashed a $1,000 Postal Service money order at a West Hollywood post office. He said the postal worker handed him 10 $20 bills and eight $100 bills. Lipin, 43, said he then stopped at a nearby gas station to fill his tank.

A retired San Fernando Valley postal worker has pleaded guilty to charges stemming from a scheme to cash in $400,000 worth of bogus money orders, the largest such case in the history of the U.S. Postal Service. Abraham Rothman, 67, of Sherman Oaks pleaded guilty to one count of conspiracy and four counts of selling and conveying government property without authority, said his attorney, James D. Gregory.

The Internal Revenue Service is notifying some of Southern California's poorest residents that they will have to come up with a duplicate tax payment--along with 10% interest penalty--to cover payments made with worthless money orders purchased from the now-defunct General Money Order Co.

In the world of billion-dollar financial collapses, the state seizure of an obscure Southern California money order company last December attracted scant public attention because it involved a mere $3.2-million shortage. But the demise of General Money Order Co. has left in debt an estimated 100,000 people, most of them poor Latino immigrants or African-Americans who had unwittingly used the worthless paper to pay everything from rent to immigration fees.

QUESTION: I live in Venice and I recently paid my $850 monthly rent with a couple of general money orders. Three days later, the news reported that the money order company from which I paid the rent had gone bankrupt. My landlord has since returned the money orders to me. He told me they are no good. He says it's not his responsibility, and understanding that I cannot afford to pay the rent again, he has suggested that I pay $100 per month until I repay the $850.

Tens of thousands of now-worthless money orders taken from stores by looters during the Los Angeles riots are being peddled to unsuspecting buyers, according to City Atty. James K. Hahn. The money orders and imprinting machines were stolen from a number of stores during the civil unrest. Investigators believe some looters targeted businesses where they knew money orders were sold.

Two former San Fernando Valley postal workers have been indicted by a federal grand jury on charges that they stole blank money orders and cashed them for more than $400,000 in what authorities are calling the largest such case in the history of the U.S. Postal Service. Abraham Rothman, 67, of Sherman Oaks and Gilbert Capaldo, 43, of Reseda were each charged Tuesday with one count of conspiracy and four counts of selling and conveying government property without authority, Assistant U.S. Atty.

Question: I live in a deed-restricted home in Torrance. I have written, called and had an attorney write the board regarding faulty common areas, but they refuse to fix the problems. I pay my monthly fees by money order, sent by certified mail, return receipt requested, and have never been late or missed a payment in 31 years.

After dozens of protesters assailed them for a recent electricity rate hike, state regulators Tuesday ordered an investigation into the transfer of billions of dollars from utilities to parent companies and whether the parents failed to help them during the energy crisis. "This order is absolutely necessary to establish the credibility for any rate hike," said California Public Utilities Commission member Geoffrey Brown.

A money launderer for some of Latin America's biggest drug barons has been sentenced to 37 months in federal prison for "cleansing" $150,000 in cash given him by undercover agents, federal prosecutors said Tuesday. Federal prosecutors said Jose Enrique Leon, 53, owner of the Travel Club, a Canoga Park travel agency, laundered money for south-of-the-border drug traffickers such as Amado Carrillo Fuentes and the Arellano Felix brothers.

Every two weeks, Alfredo Cervantes sends home all the money he can spare--$50, $100, sometimes $200. Saving the cash from his factory job has been tough, Cervantes said, but getting it to relatives in the small Mexican town of Sahuayo has been even tougher. Money orders disappeared in the mail. Dollars sent through an informal cross-border network were stolen. Friends who traveled to Tijuana to deposit money in Mexican banks were robbed at knifepoint.

Every two weeks, Alfredo Cervantes sends home all the money he can spare--$50, $100, sometimes $200. Saving the cash from his factory job has been tough, Cervantes said, but getting it to relatives in the small Mexican town of Sahuayo has been even tougher. Money orders disappeared in the mail. Dollars sent through an informal cross-border network were stolen. Friends who traveled to Tijuana to deposit money in Mexican banks were robbed at knifepoint.

A Newbury Park man whose ties to an anti-government militia group landed him in jail last year for 300 days is now free and said he hopes to follow a different path: a life devoted to the poor--like Mother Teresa. And while Timothy Paul Kootenay said he hopes such a mission would take him far, far away, the journey will have to wait until he is no longer on probation.

A Sherman Oaks postal worker pleaded guilty Thursday to participating in a scheme in which blank money orders were stolen and cashed for more than $400,000. Gilbert Capaldo, 43, was originally charged with 25 counts of theft of government property, one count of conspiracy and four counts of selling and conveying government property without authority, said Assistant U.S. Atty. Brian J. Hennigan.

UCLA officials on Thursday released copies of the eight postal money orders used by the sister of a basketball recruit to purchase a car registered in the name of Coach Jim Harrick. Harrick's son, Glenn, said he sold a 1991 Chevrolet Blazer registered in his father's name to Lisa Hodoh, the sister of recruit Baron Davis, for $5,000. The sale is the subject of a joint investigation by the Pacific 10 Conference and UCLA into possible NCAA violations.

Newbury Park resident Timothy Paul Kootenay, the self-proclaimed "freeman" accused of using bogus money orders to buy assault rifles, is scheduled to stand trial Sept. 9, a Superior Court judge confirmed Thursday. But his attorney is still hopeful that a resolution can be reached before the case comes to trial. "There is a good chance that the case can be resolved," Deputy Public Defender Neil Quinn said Thursday, explaining that Kootenay has made restitution for his crimes.