SoCal woman arrested after $2 mil. loan scheme

WEST HOLLYWOOD, Calif. The U.S. attorney's office says Pamela Terry claimed she was an underwriter at the Federal Reserve Bank and promised victims multi-million dollar business loans with low-interest rates.

Federal prosecutors say she collected "advance fee" payments from 15 people, but they never received their loans. She allegedly told her customers that their loans were delayed because IndyMac Bank failed.

Prosecutors say Terry used the payments to pay retailers such as Nordstrom, Louis Vuitton, Gucci and Chanel.

Terry was arrested Friday at a West Hollywood hotel.