VALDOSTA — The former president of a Lowndes County-based credit union has been sentenced to federal prison for her part in a bank loan and identity theft scheme, according to the U.S. Department of Justice.

Leah Lehman, 63, of Valdosta was sentenced Thursday to four years in prison and two years of supervised release; she will also have to pay $4,491,253.97 in restitution to Southern Pine Credit Union, the statement said.

She pleaded guilty to one count of bank fraud and one count of aggravated identity theft on Oct. 26.

In the same case, Teresa Paulo, of Valdosta, pleaded guilty to one count of bank fraud and one count of aggravated identity theft; she was SPCU’s former controller.

According to court documents: Lehman served as president of SPCU in Valdosta from 1990 to 2020. Paolo was SPCU’s controller from October 2011 to June 2020. The credit union’s members are employees of the local paper mill and their families. Lehman and Paolo were both authorized to originate all types of loans, were responsible for filing quarterly reports to the National Credit Union Administration and had access to all SPCU employees’ usernames and passwords for all SPCU computers and software.

An earlier U.S. Attorney’s statement said Lehman began her fraud in June 2003 when she created a share-secured loan in an SPCU account using the name and Social Security number of a member without that individual’s knowledge. From February 2012 to May 31, 2020, Lehman paid off the loan and rebooked it multiple times with additional advances, the statement said. She would take the proceeds and put them in a joint share draft account she had with the individual, using the proceeds to pay for a boat, a hunting club share, personal expenses and gifts to family members. This loan was repaid in full.

However, Lehman created another share secured loan in another individual’s name without their knowledge and would also pay off the loan and rebook it multiple times for personal spending, the U.S. Attorney’s Office said. To conceal these activities, Lehman created false credit transactions using the names and passwords of SPCU employees. These transactions would advance the due date on the loans, which prevented these loans from appearing on quarterly call reports to the NCUA and allowed Lehman to defer or not make payment on these loans. Following these transactions, Lehman created debit entries to put the loans back on the accounts, which would often include interest accrued on the outstanding loans. She made additional fraudulent loan advances simultaneously with those entries to advance the loan dates. She reflected the loans as being paid off at the end of the quarter to prevent possible detection of artificial growth in the SPCU loan portfolio.

In total, the drafts needed to pay off the loan balances at each quarter grew to $4,112,870.63, excluding payments and interest, as of May 31, 2020, the U.S. Attorney’s Office said.

The case was investigated by the FBI and the Federal Deposit Insurance Corporation.