Sunday, July 31, 2011

Former Butler County Auditor Mary C. Rogers, Sentenced to 24 Months in Prison for Conspiracy, Tax Crimes


Source- http://www.fbi.gov/cincinnati/press-releases/2011/former-butler-county-auditor-sentenced-to-24-months-in-prison-for-conspiracy-tax-crimes

CINCINNATI—Butler County Auditor Mary C. Rogers was sentenced in United States District Court to 24 months in prison and ordered to pay restitution to National City Bank in the amount of $4 million for conspiracy and filing a false income tax return.

Carter M. Stewart, United States Attorney for the Southern District of Ohio; Edward J. Hanko, Special Agent in Charge, Federal Bureau of Investigation, Cincinnati Division; and Tracey L. Warren, Acting Special Agent in Charge, Internal Revenue Service Criminal Investigation announced the sentence handed down today by Senior United States District Judge Sandra S. Beckwith.

Rogers pleaded guilty on February 25, 2008 to one count of conspiring to commit mail and wire fraud and one count of filing false income tax returns from 2001 through 2006.

Rogers conspired with others to defraud National City Bank out of approximately $4 million between August 2004 and March 2006 while she was Butler County Auditor.

As auditor, Rogers oversaw Butler County’s Information Services Division, which was responsible for a countywide fiber optics installation project. She conspired with others to help Dynus Corporation fraudulently secure more than $4 million from National City Bank by falsely representing that Dynus had a contract with the county.

As part of the fraud, Rogers signed several documents certifying that Dynus had completed certain work that the company had not actually done.

Rogers also failed to report approximately $56,289.05 in income she received from a tax preparation and accounting business she operated from 2001 until 2006.


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Saturday, July 30, 2011

Anna McElaney Sentenced to Federal Prison for Defrauding Bank in Short Sale Mortgage Fraud Scheme


Source- http://www.fbi.gov/newhaven/press-releases/2011/real-estate-agent-sentenced-to-federal-prison-for-defrauding-bank-in-short-sale-mortgage-fraud-scheme

David B. Fein, United States Attorney for the District of Connecticut, announced that ANNA McELANEY, 40, of Norwalk, was sentenced today by United States District Judge Janet C. Hall in Bridgeport to eight months of imprisonment, followed by three years of supervised release, the first six months of which McELANEY must spend in home confinement, for her involvement in a “short sale” mortgage fraud scheme.

A short sale transaction involves a mortgage holder or lender entering into an agreement to release its mortgage or lien on real property in exchange for payment of less than the total amount owed on the underlying debt. Many short sale transactions are legitimate.

According to court documents and statements made in court, McELANEY, a real estate agent, and Sergio Natera, also a real estate agent, defrauded Regions Bank, which held two mortgages on a residential property in Bridgeport. On December 5, 2007, McELANEY, who was a listing agent for the property, received an offer to purchase the property for a price of $132,500. However, McELANEY and Natera informed Regions Bank that the highest offer to purchase the property was for $102,375 and that it was made by BOS Asset Management, LLC. McELANEY and Natera concealed from Regions Bank that there was a higher offer by another bidder, that Natera owned BOS Asset Management, LLC, and that McELANEY and Natera planned to keep the difference between the two prices. Based on the false and incomplete information provided to it, Regions Bank agreed to the short sale for the lower price, and released its mortgages on the property.

On June 9, 2008, McELANEY and Natera arranged for two sales of the property to occur on the same day. The first sale was from the owner of the property to BOS Asset Management, LLC for $102,375; the second sale was from BOS Asset Management, LLC to the original bidder on the property for $132,500. McELANEY and Natera retained the difference between the two sale prices.

“This prosecution should serve as a warning to real estate agents and others who seek to take advantage of the current financial crisis by defrauding lenders through short sale fraud schemes,” stated U.S. Attorney Fein.

On February 19, 2010, McELANEY pleaded guilty to one count of bank fraud. Natera pleaded guilty to the same charge on February 11, 2010. He awaits sentencing.


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Friday, July 29, 2011

Mark Swank Sentenced to Serve 21-Month Prison Term for Fraud for Money Laundering


Source- http://www.fbi.gov/springfield/press-releases/2011/peoria-businessman-sentenced-to-21-month-prison-term-for-fraud

PEORIA, IL—A Peoria-area businessman, Mark Swank, 40, of Washington, Ill., was sentenced today to serve 21 months in federal prison for money laundering and bankruptcy fraud, as announced by James A. Lewis, U.S. Attorney for the Central District of Illinois. U.S. District Judge James E. Shadid ordered that Swank surrender on Sept. 27, to the Federal Bureau of Prisons. Swank was also ordered to pay restitution in the amount of $800,000, and to serve a two-year term of supervised release upon completion of his prison sentence.

On Apr. 20, 2011, Swank waived indictment and pled guilty to an information charging him with money laundering and bankruptcy fraud. Swank, the owner and president of several corporations in central Illinois, including T.A. Brinkoetter and Sons, secured a bank loan of $1,000,000 and a $1,600,000 line of credit in January 2008 to acquire all of T.A. Brinkoetter’s outstanding stock. As president, Swank pledged all of the company’s assets, including equipment, as collateral to secure the loans. In September 2008, Swank sold the encumbered equipment to another bank for $660,000; then entered into an agreement to lease it back. Swank admitted that he falsely represented to the bank that the equipment was not encumbered by any liens when in fact he knew that the equipment was encumbered to the bank from which he had secured two loans.

Further, Swank admitted that when he and his wife filed for bankruptcy under Chapter 7, in May 2010, Swank falsely stated, in documents filed with the court, that he did not possess more than $5,000 in cash. On July 7, 2010, Swank testified at a meeting of creditors that he had reviewed and signed the bankruptcy papers and that the papers were accurate. However, during execution of search warrants of the corporations and of Swank’s home on July 8, 2010, agents found $92,000 in cash at Swank’s home.


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Thursday, July 28, 2011

Gino Carlucci and Wayne Mounts, both residents of Arizona, have been convicted of conspiracy to commit money laundering and conspiracy to defraud the Internal Revenue Service (IRS)


Source- http://www.justice.gov/opa/pr/2011/July/11-tax-969.html

WASHINGTON-- Gino Carlucci and Wayne Mounts, both residents of Arizona, have been convicted of conspiracy to commit money laundering and conspiracy to defraud the Internal Revenue Service (IRS), the Department of Justice and IRS announced today. A federal jury also convicted Carlucci for filing a false income tax return in 2004. The jury returned a not guilty verdict for Carlucci on a separate witness tampering charge. The verdict came following an eight day trial before Chief Judge Kathryn H. Vratil of the District of Kansas, sitting by special designation in Phoenix.

Carlucci and Mounts were indicted by a federal grand jury in April 2010. According to the evidence presented at trial, Carlucci and Mounts devised several false schemes to defraud Joseph Flickinger, a tax return preparer, and Flickinger’s taxpayer and investment clients out of funds and assets. Flickinger himself had been running a Ponzi-type scheme in which he defrauded his investment clients of their life savings. At the time of Carlucci and Mounts’s fraud, Flickinger was under indictment in the Southern District of Ohio on tax fraud charges.

As established at trial, Carlucci and Mounts’s false schemes included a purported investment in a fraudulent casino project in Antigua. In addition, at the time of the charged conduct, the Securities and Exchange Commission (SEC) had frozen all of Carlucci’s assets due to his involvement in a civil securities matter in Utah. Carlucci and Mounts’s second scheme involved defrauding Flickinger and others of money that was supposedly going to be used to pay Carlucci’s SEC penalty. Carlucci and Mounts had a third scheme which involved helping Flickinger hide from the government monies that he had defrauded from his own investment clients, in part by Carlcucci and Mounts promising to wire the funds through a series of accounts in the Caribbean so that the funds could not be traced or seized by the government.

The evidence at trial established that after getting the last of Flickinger’s funds, Carlucci set Flickinger up to be arrested by assisting him in arranging a private jet to flee to Antigua, where Flickinger believed the funds were hidden. Instead, Carlucci anonymously tipped off the government to the scheme, causing Flickinger to be arrested. Carlucci and Mounts then used the money for their own personal benefit by withdrawing cash in structured amounts and transferring cashier’s checks and wire transfers to nominee accounts for their own benefit. In addition, Carlucci and Mounts spent over $150,000 of the funds to buy a 43-foot luxury boat that Carlucci later concealed from the government for over two years. Despite personally benefitting from the money in 2004, Carlucci signed and filed a false individual income tax return that failed to report any of the money he got in the scheme, and instead reported that he was due a refund due to the Earned Income tax credit. The evidence showed that the government located and seized the boat, which was being hidden at an associate’s home in Phoenix, in 2007.


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Wednesday, July 27, 2011

Niagara Falls Businessman John J. Gross Pleads Guilty to Fraud and Tax Charges


Source- http://www.fbi.gov/buffalo/press-releases/2011/niagara-falls-businessman-pleads-guilty-to-fraud-and-tax-charges

BUFFALO, NY—U.S. Attorney William J. Hochul, Jr. announced today that John J. Gross, 75, of Niagara Falls, New York, pleaded guilty before U.S. District Judge Richard J. Arcara to mail fraud and filing a false tax return. The charges carry a maximum penalty of 23 years in prison and a $500,000 fine.

First Assistant U.S. Attorney James P. Kennedy, Jr., who is handling the case, stated that the fraud charge arose out of a bid rigging scheme involving work performed by a plumbing and general contracting business that Gross ran out of Niagara Falls, N.Y. Specifically, Gross admitted that following a December 2008 storm which caused damage to the Summit Mall in Wheatfield, New York, employees of his contracting company submitted two false bids which purportedly came from his competitors. One bid was entirely fabricated by a Gross employee using a supply of letterhead from one competitor. The other bid was obtained under false pretenses from another competitor at Gross’ direction. The bids were then given to an employee of the Summit Mall who presented them to management claiming they were independently obtained. Gross had previously done repairs and improvements at the employee’s home at a substantially reduced cost. As a result of the defendant’s conduct, his company, which submitted the lowest bid, was awarded the contract.

Gross also admitted to defrauding Goodyear Tire and Rubber Company on two occasions. In one instance, he utilized a Goodyear employee to obtain bids provided by other contractors to perform work at Goodyear. This allowed Gross to underbid his competitors. Gross did home repairs at substantially reduced costs or at no cost at this employee’s home. The defendant also gave the employee free charter fishing trips. In the other instance, Gross simply prepared and submitted to Goodyear, a fictitious higher-priced bid purportedly made by one of his competitors.

In addition, Gross maintained two sets of books in order to hide income from the Internal Revenue Service which had an outstanding judgment against him as a result of a tax evasion conviction in the late 1990s.


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Tuesday, July 26, 2011

Eliseo Roquiz of Erie Pleads Guilty to Filing a False Document With The Internal Revenue Service


Source- http://www.justice.gov/tax/txdv11947.htm

WASHINGTON - Eliseo Roquiz of Erie, Penn., pleaded guilty before U.S. District Judge Sean J. McLaughlin of the Western District of Pennsylvania to charges of filing a false document with the Internal Revenue Service (IRS), the Justice Department and IRS announced today.

According to court documents and statements made in court, Dr. Roquiz, an anesthesiologist, used multiple tax fraud promoters to prevent the IRS from assessing and collecting his income taxes. In 1998, Dr. Roquiz established two sham trusts with the assistance of a California-based organization called National Trust Service and paid an affiliate of National Trust Service to prepare false individual and trust tax returns for him for the years 1998, 1999 and 2000. As part of the fraud, Dr. Roquiz had medical providers pay fees for his services to the sham trusts and then claimed false deductions on the trust returns to reduce the taxes on the income to zero. Dr. Roquiz also opened bank accounts in the name of the sham trusts and transferred title to his personal residence to one of the trusts.

According to court documents and statements made in court, in 2003, after the IRS began to audit his tax returns, Dr. Roquiz hired American Rights Litigators/Guiding Light of God Ministries (ARL/GLGM), an organization located in Florida that sold abusive tax schemes, to send obstructive and frivolous correspondence to the IRS in response to notices that the IRS sent to Dr. Roquiz. After ARL/GLGM was permanently enjoined in February 2004, Dr. Roquiz hired a third fraud promoter, Joseph Saladino, to file frivolous amended U.S. Individual Income Tax Returns (IRS Forms 1040X) for the years 2000 and 2001.

According to public documents and statements, Dr. Roquiz’s efforts to disrupt IRS collection activities culminated with the submission of three false Collection Information Statements for Wage Earners and Self-Employed Individuals (IRS Forms 433-A) between January and June 2005. All three Forms 433-A, which Dr. Roquiz signed under penalties of perjury, were materially false in that Dr. Roquiz failed to disclose that he had transferred his personal residence to his sham trust and that he was a party to a lawsuit. The second and third Forms 433-A, which Dr. Roquiz submitted in May and June of 2005, were also materially false in that Dr. Roquiz failed to disclose the existence of a bank account that he opened in the name on an LLC he had established in New Mexico.


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Monday, July 25, 2011

Felix Robert LaSaracina Pleads Guilty to Fraud and Tax Charges



Source- http://www.fbi.gov/newhaven/press-releases/2011/norwich-accountant-pleads-guilty-to-fraud-and-tax-charges

The United States Attorney for the District of Connecticut announced that FELIX ROBERT LaSARACINA, 60, of Norwich, waived his right to indictment and pleaded guilty today before United States District Judge Christopher F. Droney in Hartford to one count of wire fraud and one count of failure to pay federal employment taxes.

According to court documents and statements made in court, LaSARACINA, the owner and operator of F. Robert LaSaracina CPA, LLC in Norwich, provided accounting and tax preparation services to clients in the New London and Norwich area and served as the trustee for a series of trusts set up by a family for the benefit of their three children. From approximately November 2001 to September 2010, LaSARACINA defrauded more than 20 individuals and several trusts that he controlled out of more than $2.5. million.

As part of a scheme to defraud investors, LaSARACINA falsely represented to numerous individuals and clients that he had investment opportunities in which they could participate that were safe and would pay a stated return. LaSARACINA made several false statements to victim investors, such as, that their money would be invested in real estate or with another client of his; that the investment would pay 8 percent interest and was a “sure thing”; that their money would be invested in a construction project with an individual who had previously had a bad experience with traditional banks; that their money would be or had been invested with a local business; and that he, LaSARACINA, would personally guarantee their investment. All of these statements were false, there were no actual investment opportunities, and LaSARACINA used the invested funds for his own benefit.

LaSARACINA sought to create the appearance of legitimacy to prospective investors by preparing and executing official-looking documents or investment contracts termed “Promissory Note(s),” which contained various provisions including a promise to repay the principal sum of the funds invested or loaned, a set interest rate, a confidentiality clause, and a personal “unconditional guarantee” by LaSARACINA.

LaSARACINA used the invested funds to pay personal expenses such as credit card bills, to pay business expenses and to make bogus “interest payments” to other investors. He also converted a large amount of the funds to cash.

As a trustee, LaSARACINA controlled and was responsible for managing the assets of the trusts, including the real estate holdings owned by the trusts. LaSARACINA took out a series of mortgages using the real estate that was owned by the trusts as collateral. Through this scheme, LaSARACINA diverted more than $1.2 million in mortgage funds for his own personal use.

The tax charge against LaSARACINA stems from the operation of his accounting firm. Between 2005 and 2010, LaSARACINA failed to remit to the Internal Revenue Service approximately $734,359.41 in federal income taxes and Federal Insurance Contributions Act (FICA) taxes that he had collected from the total taxable wages of employees of his business.

Judge Droney has scheduled sentencing for October 7, 2011, at which time LaSARACINA faces a maximum term of imprisonment of 25 years.

Since his arrest on October 20, 2011, LaSARACINA has been released on a bond, cosigned by family members, in the amount of $500,000.



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Sunday, July 24, 2011

Rocco DeSimone Convicted in March of Bilking Investors and Others Out of $6 Million in Cash and Property


Source- http://www.fbi.gov/boston/press-releases/2011/rhode-island-career-con-man-sentenced-to-16-years-in-federal-prison-recovered-assets-to-be-used-to-compensate-victims

PROVIDENCE, RI—A federal court judge today sentenced convicted Rhode Island con man Rocco DeSimone, 58, to 192 months in federal prison, followed by three years of supervised release, announced United States Attorney Peter F. Neronha. DeSimone was convicted in U.S. District Court in Providence in March 2011 for bilking numerous investors from around the United States out of more than $6 million in cash and property by making false representations regarding the sale and/or marketing of three inventions.

DeSimone used the money he bilked from would be investors to fund an exotic, work free lifestyle filled with fancy cars, valuable art works, ancient Japanese swords; and fanciful tales of falconeering, African safaris, jamming with the rock band Aerosmith and elephant hides buried in his backyard.

At the request of the government, DeSimone has been ordered to make restitution to his victims in the amount of $6,030,145. The court entered a preliminary forfeiture order on June 30, forfeiting numerous assets DeSimone gained through his schemes including a 2006 Ford GT sports car valued at $180,000, a painting by Pierre-Auguste Renoir known as “Paysage a Cagnes” and nine Japanese swords. The Government intends to utilize the forfeited items toward compensation to the victims for their losses.

U.S. Attorney Peter F. Neronha commented, “Justice was served today. Mr. DeSimone is a remorseless, recidivist thief, who deserves every day of the 16 years’ imprisonment he was sentenced to today. It is my hope that today’s long sentence brings some semblance of comfort to Mr. DeSimone’s victims, many of whom parted with their life saving after being caught in his web of lies.”

DeSimone escaped from a minimum security facility in New Jersey in March 2008 after he learned that federal agents had executed a search warrant at his Johnston, R.I., home in connection with this case. He was about to complete a federal prison term for tax fraud when he escaped from prison. He surrendered in Rhode Island three days later.

During a two week trial in March 2011, evidence was presented that DeSimone’s schemes involved the marketing of three inventions developed by two inventors, the Drink Stik—an invention designed to allow individuals wearing protective gear to drink fluids without having to remove the gear; the Song Tube—designed as an improved version of a gastrointestinal medical tube; and the Disk Shield—a protective shield for compact discs and DVDs.

Evidence was presented that DeSimone falsely represented to the Drink Stik inventor that he personally knew the CEO of Fidelity Investments and that he had agreed to purchase the invention for $264 million. DeSimone also falsely represented to potential investors that Fidelity, Raytheon and/or Tyco International had offered to purchase the rights to the Drink Stik for millions of dollars, and obtained about $1.2 million in funds and $4.9 million in forgiven debts and other property, including expensive art work and valuable Japanese artifacts and swords.

Evidence was also presented at trial that DeSimone convinced the physician-inventor that he could successfully market the Song Tube gastrointestinal device in exchange for an ownership interest. The inventor subsequently assigned the product patent to a company in which DeSimone had a 34 percent ownership.

Prosecutors also presented evidence that DeSimone solicited investments in the Disk Shield by falsely representing that he owned the right to market it. DeSimone fraudulently represented that Nintendo, Inc. and SONY, Inc. had offered millions of dollars for the Disk Shield, when neither company had made such an offer.

Testimony also showed that DeSimone made several false representations about marketing campaigns for the Drink Stik and Song Tube to a California investor, who subsequently wired about $600,000 to a bank account held in the name of Rocco DeSimone’s wife.


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Saturday, July 23, 2011

Muriel Amanda Dawson Indicted on Tax Charges


Source- http://www.fbi.gov/miami/press-releases/2011/former-florida-state-senator-indicted-on-tax-charges

Wifredo A. Ferrer, United States Attorney for the Southern District of Florida; Jose A. Gonzalez, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI); and John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, announce the indictment and arrest of Muriel Amanda Dawson (“Mandy”), 54, formerly a resident of Broward County, Florida. Dawson was arrested earlier today at her home in Volusia County, and is expected to make her initial appearance in federal court in Orlando this afternoon before U.S. Magistrate Judge Donald P. Dietrich. Dawson is charged with tax evasion for tax years 2004 and 2005 (Counts 1 and 2), and failure to file tax returns for tax years 2006, 2007, and 2008 (Counts 3-5). If convicted, she faces a statutory maximum term of imprisonment of up to five years on Counts 1 and 2, and not more than one year on each of Counts 3 to 5.

According to the indictment, Dawson willfully attempted to evade the payment of $11,889 and $12,966 in taxes due and owing for calendar years 2004 and 2005, respectively. Additionally, the indictment alleges Dawson failed to file income tax returns with the IRS for calendar years 2006, 2007 and 2008. During that period, Dawson was a Florida state senator representing sections of Broward and Palm Beach counties.


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Friday, July 22, 2011

Philip R. Lochmiller, Sr. Found Guilty of Conspiracy, Money Laundering Conspiracy, Money Laundering, and Mail Fraud


Source- http://www.fbi.gov/denver/press-releases/2011/philip-r.-lochmiller-sr.-found-guilty-of-conspiracy-money-laundering-conspiracy-money-laundering-and-mail-fraud

DENVER—A jury this morning found Philip R. Lochmiller, Sr. guilty of conspiracy, money laundering conspiracy, money laundering, and mail fraud, U.S. Attorney John Walsh, FBI Special Agent in Charge James Yacone, and IRS-Criminal Investigation Special Agent in Charge Christopher Sigerson announced. The guilty verdict was the result of a 10-day trial before U.S. District Court Judge Philip A. Brimmer. The jury deliberated for three hours before returning their verdicts. No sentencing date has yet been set, although that hearing will take place in Grand Junction. Lochmiller is scheduled to be back in U.S. District Court in Denver on October 27, 2011, for a hearing on victim losses and restitution. He remains free on bond pending sentencing. Two other co-defendants, Philip Lochmiller, II and Shawnee Carver, had earlier pled guilty and await sentencing, which is scheduled for October 14, 2011.

Philip Lochmiller, Sr., Philip Lochmiller, Jr., and Shawnee Carver were indicted by a federal grand jury in Denver on December 15, 2009. A superseding indictment was returned on October 18, 2010. Lochmiller, Jr. pled guilty on November 16, 2010. Carver pled guilty on December 9, 2010. Both testified during the Lochmiller, Sr. trial.

According to evidence presented at trial, the superseding indictment, and other documents from the prosecution, Valley Mortgage, Inc. was incorporated in Colorado in September 1994 by Philip Lochmiller, Sr. The company originally engaged in the business or originating or brokering home mortgages. Lochmiller, Jr. owed 100 percent of Valley Mortgage’s stock and was principal, officer and director. Lochmiller, Sr.’s stepson, Philip Lochmiller, Jr., joined Valley Mortgage in 1999 as a mortgage officer. Lochmiller, Sr. later added the name Valley Investments as a does business as for Valley Mortgage. Lochmiller, Jr. eventually worked his way to become responsible for day-to-day operations of the company. Beginning in 2000, Valley Mortgage entered into the “affordable housing” real estate market by buying vacant land or existing mobile home parks, entitling the land so residential subdivisions could be built, and then selling lots with either a mobile home or a manufactured home on it.

Valley Investments purchased land with financing provided by the sellers in a “owner-carry” arrangement. Valley Investments then began to advertise in local newspapers and solicit investment funds from the public. The company promised returns from 10 percent to 16 percent, and in some instances, as high as 18 percent. In exchange, investors were promised a promissory note and a recorded first “Deed of Trust” on individual lots. The advertisements and verbal representations by both of the Lochmillers characterized the investment as a “solid security” secured and recorded by a Deed of Trust in the investor’s name. Both of the Lochmillers represented to investors that Valley Investments used investor funds exclusively to acquire property and finance the development of the subdivisions Valley Investments owned. Both the Lochmillers further represented that Valley Investments generated large profits by selling manufactured homes together with lots within the subdivisions. Investors were not told that Lochmiller Sr. had a prior felony conviction and a bankruptcy.

Between 2000 and 2005, Valley Investments acquired five properties purportedly to develop “affordable housing” subdivisions. Between 2000 and 2009, Valley Investments received over $30,000,000 from approximately 400 investor contracts. The Government’s expert forensic accountants shows that this influx of investor funds kept Valley Investments operating, particularly in its later years, and without investor funding, Valley Investments would have failed. The Government accounting analysis also determined that investor funds were used by both of the Lochmillers for purposes other than what investors were told. Further, incoming investor funds were used to make interest and principal payments to existing investors. Once investor money started coming into Valley Investments, the funds went to personal expenses, family expenses and other non-business expenditures. Both Lochmillers then engaged in monetary transactions involving more than $10,000 of the proceeds of the fraud.

Valley Investments did not own sufficient property or assets to secure the investments as represented. Unbeknownst to investors, the amount of investment funds, which were supposed to be secured by real property, far exceeded the value of the encumbered property and the business assets. Valley Investments failed to file all of the Trust Deeds and behalf of investors as promised, and many of the filed Trust Deeds were not the first encumbrances on the properties named and were thus worthless. Despite these facts, the Lochmillers and Valley Investment employee Shawnee Carver continued to misrepresent to investors that the business was thriving, and never disclosed to new investors how their money was being used.

“Thanks to the entire trial team, including prosecutors and staff from the U.S. Attorney’s Office, the FBI and the IRS-Criminal Investigations, a jury found Philip Lochmiller, Sr. guilty of conspiracy, money laundering conspiracy, money laundering, and mail fraud. Today’s guilty verdict demonstrates that those who steal other’s hard earned money will be prosecuted to the fullest extent of the law,” said U.S. Attorney John Walsh. “Today’s guilty verdict is a victory for the over 400 victims in this case, many of whom are from the Grand Junction area.”

“Today’s sentencing reflects the tremendous dedication of our agents and the cumulative commitment of the FBI, U.S. Attorney’s Office, and IRS—Criminal Investigation to aggressively investigate and prosecute white collar criminals that prey on innocent victims,” said FBI Special Agent in Charge James Yacone. “Our efforts focused on seeking justice on behalf of the more than 400 victims throughout Colorado that have experienced financial devastation as a result of their involvement with Valley Investments.”

“Defrauding innocent investors by peddling sham investment schemes is a serious and far too common offense,” said Sean Sowards, Special Agent in Charge, IRS Criminal Investigation, Denver Field Office. “IRS Criminal Investigation will work with our law enforcement partners to vigorously pursue and hold accountable those who perpetrate these schemes to get rich quick at the expense of honest Americans.”

Lockmiller, Sr. faces not more than five years’ imprisonment, and up to a $250,000 fine for one count of conspiracy. He faces not more than 20 years in federal prison, and up to a $500,000 fine, or twice the amount of the criminally derived property, for one count of money laundering conspiracy. He also faces not more than 10 years in prison, and up to a $250,000 fine, for each of 19 counts for money laundering, and not more than 20 years in prison, and up to a $250,000 fine for each of 10 counts of mail fraud.


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Thursday, July 21, 2011

Abdelghany Antar Admits Obtaining $4.7 Million in Fraudulent Mortgages on 21 Homes in New Haven County



Source- http://www.fbi.gov/newhaven/press-releases/2011/east-haven-man-admits-obtaining-4.7-million-in-fraudulent-mortgages-on-21-homes-in-new-haven-county

David B. Fein, United States Attorney for the District of Connecticut, announced that ABDELGHANY ANTAR, 56, of East Haven, waived his right to indictment and pleaded guilty today before United States District Judge Christopher F. Droney in Hartford to one count of conspiracy to commit wire fraud stemming from his participation in a mortgage fraud scheme in New Haven County.

According to court documents and statements made in court, ANTAR owned and operated ATZ Realty, located at 612 Main Street in East Haven. From June 2006 to October 2007, ANTAR conspired with a former employee, Andrea J. Palmucci, to purchase 11 properties in New Haven County in Palmucci’s name. As part of the conspiracy, ANTAR and Palmucci made false statements to various mortgage lenders, including statements about Palmucci’s income, assets, liabilities, employment, and intention to occupy the home as a primary residence. In addition, the deposits and down payments for the properties were paid out of bank accounts in Palmucci’s name with funds owned and controlled by ANTAR. After the closings, Palmucci quitclaimed the properties back to ANTAR or to entities that ANTAR owned or controlled. Through this scheme, ANTAR obtained more than $2.7 million in fraudulent mortgages.

In pleading guilty, ANTAR also admitted that he committed mortgage fraud with respect to another 10 properties in the greater New Haven area from March 2005 to November 2006. By making, or causing to be made, materially false statements to various mortgage lenders, ANTAR obtained 11 fraudulent mortgages totaling more than $2 million to purchase the 10 properties in another individual’s name, but for ANTAR’s own benefit.

In total, ANTAR obtained, or helped to obtain, 22 fraudulent mortgages totaling approximately $4.778 million to purchase 21 properties in New Haven County. All 21 properties have been foreclosed upon or are in default, causing losses of more than $1 million to the lenders.

Judge Droney has scheduled ANTAR’s sentencing for October 7, 2011, at which time he faces a maximum term of imprisonment of five years.

On May 24, 2011, Palmucci waived her right to indictment and pleaded guilty to one count of conspiracy to commit wire fraud. She is scheduled to be sentenced on November 14, 2011.



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Wednesday, July 20, 2011

A Federal Court Has Permanently Barred Cecil A. Collier From Preparing Federal Tax Returns for Others


Source- http://www.justice.gov/tax/txdv11946.htm

WASHINGTON - A federal court has permanently barred Cecil A. Collier from preparing federal tax returns for others, the Justice Department announced today. The civil injunction order was signed by Judge W. Louis Sands of the U.S. District Court for the Middle District of Georgia. The court also ordered Collier to provide a list of his customers to the government and to mail a copy of the order to each person for whom he prepared a federal income tax return since Jan. 1, 2007.

According to the injunction order, Collier, working under the trade name "Cairo Fast Tax," employed at least two schemes to generate false or overstated claims for earned income tax credits, and correspondingly excessive tax refunds, on his customers' tax returns. The order states that Collier falsely claimed dependents or qualifying children, and falsely overstated customers' earned income to create inflated tax credit amounts.

According to the court, of the returns prepared by Collier that the Internal Revenue Service (IRS) audited for issues concerning the earned income tax credit, 98 percent of them required adjustments. The order states that Collier's tax preparation may have caused government losses exceeding $12 million.


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Tuesday, July 19, 2011

Eric Logiudice Admits Tax Evasion and Making False Statements


Source- http://www.fbi.gov/newark/press-releases/2011/manalapan-new-jersey-man-admits-tax-evasion-and-making-false-statements

TRENTON, NJ—A Manalpan, N.J., man admitted today to evading his personal taxes and sending false documents to the Department of Housing and Urban Development (HUD) in order to receive federal funding to which he was not entitled, U.S. Attorney Paul J. Fishman announced.

Eric Logiudice, 41, pleaded guilty to an information charging him with one count of tax evasion relating to tax year 2006, and one count of making false statements. The false statements were made in documents submitted in order to obtain community redevelopment funds. The defendant entered his guilty plea before U.S. District Judge Joel A. Pisano in Trenton federal court.

According to documents filed in this case and statements made during Logiudice’s guilty plea proceeding:

Logiudice admitted that he evaded paying approximately $115,711 in personal income taxes for 2006. From 2005 through 2008, he evaded approximately $199,847 in personal income taxes by submitting false and fraudulent tax returns that failed to disclose approximately $607,161 in income. This unreported income included at least approximately $150,000 stolen and embezzled from the defendant’s former employer, NJS Metropolitan Architectural Woodworking Inc., in Union, N.J. (NJS).

While working at NJS, Logiudice became aware that an individual was submitting an application to the City of Orange Township Department of Planning and Development to receive Essex County HUD’s Community Economic Revitalization Program funds for a renovation project on Lincoln Avenue. After the defendant became the general contractor for the project, he caused another NJS employee to create fraudulent, certified weekly payroll reports for five employees who never worked on the project and then submitted them to City of Orange officials, obtaining $52,872.50 in community redevelopment funds from HUD.

The charges to which Logiudice pleaded guilty each carry a maximum potential penalty of five years in prison and a $250,000 fine. In addition, Logiudice has agreed to pay restitution of $199,847 to the IRS for all losses resulting from his submission of fraudulent tax returns for 2005 through 2008; $52,872.50 to HUD for his submission of fraudulent payroll records; and at least $150,000 to NJS Metropolitan Architectural Woodworking Inc. Sentencing is currently scheduled for October 17, 2011.


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Monday, July 18, 2011

Mark D. Leitner Pleads Guilty in Florida to Filing False Liens for $48.489 Billion Against Federal Law Enforcement


Source- http://www.justice.gov/tax/txdv11934.htm

WASHINGTON - Mark D. Leitner entered a plea of guilty in the Northern District of Florida to filing false liens against federal law enforcement and corruptly endeavoring to impede and impair the Internal Revenue Service (IRS), the Justice Department announced today. Senior District Court Judge Lacey A. Collier presided over the hearing at the U.S. District Court in Pensacola, where Leitner admitted to filing the false liens against the former U.S. Attorney for the Northern District of Florida, the former clerk of court, and numerous Assistant U.S. Attorneys, Department of Justice trial attorneys and an IRS criminal investigation special agent involved in a 2010 tax fraud prosecution against Leitner.

According to the documents filed in the court proceeding, Leitner was previously a defendant in a criminal trial, U.S. v. Hirmer, et. al., in the Northern District of Florida in March 2010. A jury in the Northern District of Florida found him guilty of conspiracy to defraud the IRS after a month-long jury trial. During that jury trial and after the jury returned the guilty verdict, Leitner publicly filed false maritime liens against the property of the prosecutors, investigators and court personnel involved in the criminal trial. The liens falsely claimed that Leitner was owed $48.489 billion from each individual. On five of the seven false liens, Leitner publicly disclosed individuals' correct Social Security numbers and other personal identifying information. Leitner also filed and mailed numerous harassing and frivolous documents to the courts and personnel involved in this case.

Leitner, who is presently serving a five year sentence for his 2010 tax fraud conviction, now faces up to an additional thirteen years of incarceration and fines of more than $500,000. Judge Collier scheduled sentencing for Sept. 27, 2011.


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Sunday, July 17, 2011

Frank G. Bivings and Isabelle Blanco co-owners of The Bivings Group Inc., Pleaded Guilty to Employment Tax Fraud and Failure to Pay Tax



Source- http://www.justice.gov/opa/pr/2011/July/11-tax-931.html

WASHINGTON – Frank G. Bivings and Isabelle Blanco of Washington, D.C., husband and wife and co-owners of The Bivings Group Inc., pleaded guilty today to charges stemming from the failure to pay more than $2 million in employment taxes to the Internal Revenue Service (IRS). The guilty plea took place in U.S. District Court for the District of Columbia.

Bivings pleaded guilty to one count of failure to pay over employment taxes. Blanco pleaded guilty to one count of failure to pay a tax. Sentencing for both defendants is scheduled for Oct. 20, 2011.

The Bivings Group was a full-service Internet communications business. In pleading guilty, Bivings and Blanco both admitted that between Jan. 1, 2002, and June 30, 2008, The Bivings Group failed to pay over to the IRS a total of $2,420,927 in employment taxes, which includes withholding and Federal Insurance Contributions Act (FICA) taxes. Of this amount, $1,813,488 represented the money that was withheld from employees for taxes but that was not paid over to the IRS. The department said that, instead of paying these payroll taxes to the IRS, the defendants used the funds to pay themselves substantial salaries and withdrew additional corporate funds for other expenses.

Bivings faces a maximum of five years in prison, and Blanco faces a maximum of one year in prison. The parties agreed, however, that the calculation under the advisory U.S. Sentencing Guidelines for each defendant is 30 to 37 months in prison. Both defendants also agreed to pay $2,420,927 in restitution.



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Saturday, July 16, 2011

John Jackson Sentenced to Two Years in Prision for Filing False Tax Returns



Source- http://www.justice.gov/tax/txdv11929.htm

WASHINGTON - John Jackson, the former mayor of White Hall, Ala., was sentenced to two years in prison today, the Department of Justice and the Internal Revenue Service (IRS) announced. According to court documents, Jackson filed false joint 2004, 2005 and 2006 U.S. Individual Income Tax Returns (IRS Forms 1040) that did not report all of the total income earned by Jackson and his spouse. Jackson did not report as income money he took from the city of White Hall and money he diverted from non-profit companies who handled the gaming license for White Hall.

Jackson was also sentenced to one year of supervised release, and ordered to pay a $25,000 fine and restitution in the amount of $11,065.



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Friday, July 15, 2011

A Federal Court has Permanently Barred Howard Musin, his wife Jill Schwartz-Musin From Preparing Federal Tax Returns for Others


Source- http://www.justice.gov/opa/pr/2011/July/11-tax-921.html

WASHINGTON – A federal court has permanently barred Howard Musin, his wife Jill Schwartz-Musin and their three companies from preparing federal tax returns for others, the Justice Department announced today. The three businesses named in the court’s civil injunction order are SSC Services Inc., M-S Services Inc. and Schwartz’s Systems Corporation. Trial evidence showed that the Musins reside in Clive, Iowa.

Following an eight-day trial, U.S. District Court Judge John A. Jarvey found that the defendants engaged in a wide variety of misconduct in preparing tax returns for their customers, many of which were distributors for Shaklee Corporation, a large multi-level marketing firm. According to court documents, the couple improperly claimed business expense deductions on customers’ returns for costs of personal items . Court documents also state that the Musins attempted to hide their improper deductions, including disguising nearly $70,000 in personal cattery expenses for a customer who bred cats as a hobby by listing them as business expenses of the customer’s computer consulting business.

According to evidence presented at trial, Schwartz-Musin worked for the Internal Revenue Service (IRS) from 1972 to 1978, and for part of that time she was a criminal investigator. The complaint alleges that Schwartz-Musin became a tax return preparer in 1982 and, in 2000, pleaded guilty to one criminal count of obstructing the administration of the tax laws. The court found that, the earlier criminal conviction notwithstanding, the defendants created and submitted a backdated, false form to the IRS during a customer audit in 2006 in a fraudulent attempt to justify an improper deduction.


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Thursday, July 14, 2011

Federal Court has Permanently Barred Charles Klink, Caleb Grodsky and Steven Block From Promoting Abusive Tax Shelters Known as "Intermediary Transactions"


Source- http://www.justice.gov/tax/txdv11905.htm

WASHINGTON - A federal court has permanently barred Charles Klink, Caleb Grodsky and Steven Block from promoting abusive tax shelters known as "intermediary transactions" and "distressed asset trusts," the Justice Department announced today. The civil injunction orders, to which the three men consented without admitting to the allegations against them, were entered by Judge Joseph Irenas of the U.S. District Court for the District of New Jersey. The court orders require the defendants to give the government a list of all persons who participated in any tax plan or arrangement that they promoted since Jan. 1, 2000.

According to the government complaint, Klink and Grodsky, who are both attorneys in Southern California, and Block, who resides in Louisville, Ky., and has worked in the financial services industry for more than two decades, received millions of dollars from customers across the country for helping them dispose of corporate assets without paying federal corporate income taxes on the resulting capital gain income. The complaint alleges that the three men used an intricate web of trusts and corporations to act as intermediaries between their customers, who owned closely held corporations, and buyers who wanted to purchase the corporations' assets.

The complaint alleges that the defendants purchased all of the stock in a customer's corporation shortly before or after the asset sale. They then allegedly falsely told the customer that, following defendants' purchase of the corporation, the defendants would restructure the corporation into a profitable new business and have it pay the corporation's federal income taxes resulting from the asset sale. However, according to the complaint, rather than pay the taxes owed after the asset sale, the defendants allegedly claimed deductions for sham fees and bogus bad debt write-offs generated from distressed-asset-trust tax shelters to offset most or all of the capital gains. The defendants also allegedly took steps to siphon off the corporation's assets, leaving it with no funds to pay any taxes due once the Internal Revenue Service learned of the scheme and assessed taxes.

The complaint against Klink, Grodsky and Block alleges that they have caused the corporations they acquired to deduct improperly more than $112 million of distressed consumer receivables. The government estimates that the tax loss resulting from their promotion of the tax schemes at issue in this case exceeds $40 million.


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