Seven former employees of Bank of America, Wachovia, Commerce Bancorp, and PNC Financial Services Group have been arrested in connection with a scheme in which they allegedly obtained customer data, which was then sold to law firms and debt-collection agencies.

Account numbers and balances on 670,000 accounts were found on 13 computers seized from Orazio Lembo, the alleged mastermind, Hackensack, N.J., police said Monday. Lembo, who operates DRL Associates, an investigation firm that provides information for background checks, has been charged with multiple counts of illegally disclosing data from a database and one count of racketeering. He faces up to 130 years in prison if convicted.

Lembo allegedly paid the bank employees for the account data, and then resold it to some 45 law firms and debt-collection agencies. Police are investigating who at the law firms and collection agencies received the data. "We don't believe they were entitled to the information," says Capt. Frank Lomia of the Hackensack police. The Internal Revenue Service and FBI aren't actively involved in the investigation but are being kept apprised. Additional arrests are expected, Lomia says.

Among those arrested were two former Wachovia employees, Myron Frierson and Maurice Williams II, both financial specialists, and one former Bank of America employee, Kelvin Diaz.

Wachovia has notified 48,000 customers and Bank of America has notified 60,000 customers whose account data was found in Lembo's computers. There's no evidence the information has been used to commit identity-theft crimes, the banks say. Bank of America and Wachovia have offered customers a free credit-monitoring service and are cooperating with local law-enforcement agencies. Officials for Commerce Bank and PNC couldn't be reached for comment.

The other former bank employees arrested were: Zoran Levajac, a former branch manager at Commerce Bank and a former employee of PNC; Kathleen Lovelace, a former assistant branch manager at Commerce Bank and a former employee of PNC; James Digangi, a former employee of Commerce Bank and PNC; and Anthony Diamanti, a former employee of Commerce Bank. Each of those arrested faces up to 40 years in prison if convicted.

The bust is the latest black eye for Bank of America, which in February disclosed the loss of a tape containing information on 1.2 million credit-card customers. Earlier this month, Time Warner reported that tapes containing Social Security and other personal information on 600,000 current and former workers were missing. Other incidents involving loss or theft of customer data from Ameritrade, ChoicePoint, LexisNexis, DSW Shoe Warehouse, and Polo Ralph Lauren have triggered calls for new laws on customer notification and data protection.