Philadelphia Police Officer Charged in Loan-Sharking Scheme

Already under indictment, officer charged again.

By Vince Lattanzio
|  Friday, Mar 8, 2013  |  Updated 3:30 PM EDT
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Officer Charged in Loan-Sharking Scheme

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A former Philadelphia Police Officer already under indictment for insurance fraud has been charged with extortion in an alleged loan-sharking scheme.

Gary Cottrell, 46, a former 14th district police officer, was arrested Friday morning. He is charged with four counts of making an extortionate extension of credit, four counts of collecting an extension of credit by extortionate means, and eight counts of obstruction.

According to law enforcement officials, he is accused of making high-interest loans to several people and threatening force if the loans weren’t repaid.

The charges were announced today by United States Attorney Zane David Memeger and FBI Acting Special Agent-in-Charge John Brosnan.

Last April, Cottrell was arrested when officials said he acted as a "wreck chaser” while both on and off-duty. It was allegedly that he sent car accident victims to University Collision Centers, for which he received illegal cash payments.

Additionally, police also say Cottrell filed false claims of his damage to his own vehicles.

Cottrell was suspended from the force and ultimately dismissed.

Now authorities believe that he also ran a loan sharking business both during his time on the force and since since leaving the department. They maintain that Cottrell doled out loans ranging from hundreds to thousands of dollars. The interest generally equaled $25 for every $100 and typically had to be repaid within four weeks. That’s much higher than the legal limit of 25-percent a year.

Court documents say Cottrell used his cell phone to store personal information about his clients. He also allegedly used the phone to send threats of force via text message.

One of Cottrell’s alleged clients is Cheryl Stephens, an active police officer in the 18th district. Sources tell NBC10.com, Stephens is a 10 year veteran and was taken into custody while on the job.

Prosecutors say Stephens lied to a grand jury about paying interest on her loans. They allege she lied after being told to do so by Cottrell.

According to prosecutors, Stephens is not the only client that Cottrell tried to persuade from cooperating with investigators. A number of other individuals, identified only by initials are alleged to have been contacted by Cottrell with the intent of preventing them from "communicating information to a law enforcement officer relating to the commission and possible commission of a federal offense."

Cottrell faces 16 charges including obstruction and making an extortionate extension of credit. The maximum sentence is 320 years in prison and $4 million fine. Stephens is charged with two counts of making false statements to a grand jury. She faces 10 years in prison and a $5,000 fine.

The case was investigated by the Federal Bureau of Investigation, the Philadelphia Police Department Public Corruption Task Force and the Philadelphia District Attorney’s Office.  It is being prosecuted by the United States Attorney's office.

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