Christopher Wayne White Guilty of Mortgage Fraud

February 6, 2015

A Broward real estate broker was sentenced to 41 months in prison, three years’ supervised release and ordered to pay $4,029,892, in restitution to victims in three separate fraud cases.

Mortgage FraudChristopher Wayne White, 44, of Fort Lauderdale, Florida, pled guilty on November 21, 2014 in Case No. 14-60283-CR-Dimitrouleas to one count of wire fraud. According to documents filed with the court, White made numerous false statements to the mortgage lender in connection with the purchase of a luxury home on Sea Island Drive in Fort Lauderdale. According to court records, White inflated his bank account balances, income, deposit and assets to fraudulently induce the mortgage lender to issue a mortgage loan in excess of $4.9 million dollars. The property was subsequently foreclosed by the lender resulting in substantial losses.

In Case No. 14-60282-CR-Dimitrouleas, White pled guilty on November 21, 2014 to six counts of wire fraud. According to court documents, White was a licensed real estate broker and owner and operator of the Christopher White Group in Fort Lauderdale. White obtained multiple real estate deposits in excess of $750,000 via wire transfers involving properties in Broward County from individuals and refused to return the escrow deposits. Subsequently, the Secretary of Florida’s Department of Business and Professional Regulation ordered an emergency suspension of White’s real estate broker’s license.

In Case No. 14-60216-CR-Dimitrouleas, White pled guilty on November 21, 2014 to three counts of making material false statements to U.S. Citizenship and Immigration Services. According to documents filed with the court, these statements were included on White’s April 16, 2014, application for naturalization submitted to the U.S. Department of Homeland Security, U.S. Citizenship and Immigration Services. White made the following material false statements in his naturalization application: (1) that he had never claimed to be a U.S. Citizen; (2) that he had never committed, assisted in committing or attempted to commit a crime or offense for which he was never arrested; and (3) that he had never failed to support his dependents.

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John M. Moore sentenced to Prison for Filing False Tax Returns

February 4, 2015

A tax preparer, John M. Moore, 53, was sentenced to 78 months in federal prison for filing false tax returns that cost a Kansas company more than $744,000.

Tax Fraud1Moore pleaded guilty to one count of filing a false tax return and one count of wire fraud. In his plea, he admitted a company he owns, Accent Payroll Services (APS), was hired to provide payroll processing services for Tytan International L.L.C. of Lenexa, Kan. From 2008 to 2010, APS was responsible for paying the wages of Tytan’s employees, withholding employment taxes, filing Tytan’s employment tax returns on Internal Revenue Service form 941 and paying withheld employment taxes to the IRS.

Moore transferred more than $2 million in employment tax withholdings from Tytan’s bank account to his company’s bank account. However, he only paid the IRS approximately $1.3 million. To keep Tytan from receiving notices from the IRS that taxes were not paid, Moore gave the IRS an address for Tytan at a post office box he controlled.

“These victims trusted Mr. Moore to properly remit their taxes, but instead he used their funds for his own purposes. Unfortunately, these victims are left holding the bag,” said Sybil Smith, Special Agent in Charge of IRS Criminal Investigation. “Businesses who utilize a third party for paying their payroll taxes must realize that if the taxes aren’t paid, they are ultimately responsible for the tax liability. The IRS will work with victims to set up payment plans or possibly reduce penalties.”


Steven Metro – Indicted for Securities Fraud

February 3, 2015

A federal grand jury indicted the managing clerk of the New York office of a prominent, international law firm for his alleged participation in a multi-year insider trading scheme that netted more than $5.6 million in illicit profits, New Jersey U.S. Attorney Paul J. Fishman announced.

securities fraudSteven Metro, 40, of Katonah, New York, is charged by indictment with one count of conspiracy to commit securities and tender offer fraud, one count of securities fraud, and one count of tender offer fraud.

According to documents filed in this case and statements made in court:

From 2009 to 2013, Metro, who was then the managing clerk of the New York office of Simpson Thacher & Bartlett LLP (the “Law Firm”), one of the nation’s premier mergers and acquisitions firms, repeatedly provided material, nonpublic information to his friend and former law school classmate, Frank Tamayo, 41, of Brooklyn, New York.  The inside information divulged by Metro to Tamayo related to corporate transactions, such as mergers and acquisitions or tender offers, in which the law firm represented a party or financial advisor to the transaction. As the firm’s managing clerk – a litigation-related function – Metro did not personally work on most of the corporate transactions at issue. In most instances, Metro allegedly stole the inside information by scouring the firm’s computer system using search terms such as “merger agreement,” “bid letter,” “engagement letter,” “due diligence,” as well as client names, client-matter numbers, or combinations thereof.

Metro then divulged the inside information to Tamayo in person, usually meeting at a bar, coffee shop, or other location near their respective workplaces in midtown Manhattan.  During such meetings, Metro provided Tamayo inside information pertaining to, among other things, the names and/or ticker symbols of the companies whose securities should be purchased, the general timing of the planned deals, and information related to how the deals would affect the issuers’ stock price once announced. Tamayo generally would write the security’s ticker symbol on a small piece of paper or napkin and commit to memory any pricing/timing inside information provided by Metro.

After Tamayo received the inside information from Metro, Tamayo would meet with Vladimir Eydelman, 42, of Colts Neck, New Jersey, a professional stock broker. Tamayo usually would meet Eydelman near Eydelman’s workplace, such as at the large clock in New York City’s Grand Central Terminal, where Tamayo would pass the inside information on to Eydelman. Tamayo would show Eydelman the paper or napkin on which Tamayo had written the ticker symbol of the company whose securities should be purchased. After Eydelman memorized the ticker symbol, Tamayo then would chew the paper or napkin until it was destroyed.

After receiving the inside information provided by Metro, whom Eydelman knew as Tamayo’s source at a law firm, Eydelman purchased securities for himself, family members, friends, and/or clients, including Tamayo. Eydelman quickly sold the shares and covered any positions once the relevant deal was publicly announced and the stock price rose.

Throughout the course of the five-year scheme, Tamayo reinvested the approximately $7,000 in profits that Metro made on the first deal and updated Metro on the running balance of his profits from the insider trading scheme. As of October 2013, by which time the conspirators had traded ahead of at least 13 planned corporate transactions, Metro’s share of the profits had reached approximately $168,000.  Metro sought to cash out his share of the accrued profits from the insider trading scheme, pressing Tamayo to “liberate some cash” during a meeting in January 2014.  Eydelman paid approximately $7,000 in cash to Tamayo in February 2014, with the expectation that Tamayo would use the cash to compensate Metro.
Tamayo, Metro and Eydelman netted more than $5.6 million in illicit profits over the course of the five-year insider trading scheme.

The conspiracy count with which Metro is charged carries a maximum potential penalty of five years in prison and a fine of $250,000. The securities and tender offer fraud counts carry a  maximum potential penalty of 20 years in prison and a fine of $5 million.


Tax Fraud Scheme earns Georgia man Prison Sentence

February 2, 2015

A Georgia man, Sirhon “Ron” Rivers, 40, was sentenced in federal court to eight years and six months in federal prison without parole for a wire fraud scheme in which he used the identity information of deceased persons to obtain more than $2.3 million in tax refunds from several states.  The court also ordered Rivers to pay $2,358,612 in restitution.

Tax FraudOn Sept. 14, 2014, Rivers pleaded guilty to one count of wire fraud, one count of aggravated identity theft, one count of conspiracy to commit money laundering and one count of conspiracy to commit wire fraud and aggravated identity theft.

Rivers admitted that he unlawfully obtained $547,000 from the Missouri Department of Revenue from January 2008 to August 2012 by filing fraudulent tax returns. Rivers used the same scheme in others states—including Kansas, Alabama, Arizona, Connecticut, Delaware, Georgia, Idaho, Louisiana, Michigan, Minnesota, New York, North Carolina, North Dakota, Oklahoma, Rhode Island and Virginia—to unlawfully acquire a total of $2,365,617 in fraudulent state tax refunds.

Rivers obtained personal identification information—including names, Social Security numbers, and dates of birth—from deceased persons. He submitted state tax returns using that information, adding false and fraudulent information such as employment and wages earned. State tax returns were submitted electronically, with the refunds electronically transferred to bank accounts that Rivers opened at several financial institutions.


IRS Tax Fraud – Dewayne Long faces Prison

February 1, 2015

Dewayne K. Long, 53, of Omaha, Nebraska, was sentenced for conspiracy to defraud the United States by filing false federal income tax returns for income tax refunds.  The Honorable Joseph Bataillon sentenced Long to one year and one day in prison, three years of supervised release and restitution in the amount of $440,924.00.

IRS-logoBeginning around December 1, 2008, through March 2010, Dewayne K. Long, and another individual conspired to defraud the Internal Revenue Service by filing false federal income tax returns which contained fraudulent claims for income tax refunds.  These claims were based upon false amounts of federal income tax withheld which were reported on false Forms 1099-0ID.  The Form 1099-OIDs (Original Issue Discount) improperly claimed that the clients had income and corresponding federal income taxes withheld, which resulted in a refund due from the IRS.  Long and his co-conspirator caused nine (9) false claims to be filed with the IRS, totaling $4,701,010.00.

“This defendant filed fraudulent tax returns with bogus claims in an attempt to steal from the U.S. Treasury and the taxpaying public,” said Tanya Brewer, Acting Special Agent in Charge of IRS Criminal Investigation.


Jaime Sanchez sentenced to Prison for Mortgage Fraud – Choices and Consequences

January 31, 2015

An Individual was sentenced for his role in illegal mortgage fraud kick-back scheme, which resulted in his and his co-conspirators fraudulently obtaining $3,000,000 in 12 fraudulent mortgage loans at Marina Oaks Condominiums.

mortgagefraudJaime Sanchez, 43, was sentenced to 168 months in prison, followed by five years of supervised release. On October 29, 2014, Sanchez pled guilty to conspiracy to commit mail and wire fraud affecting a financial institution. Sanchez had been previously charged in connection with fraudulently obtaining mortgages for the purchase of 12 condominium units at Marina Oaks Condominiums in Fort Lauderdale, Florida.

According to the indictment from January 2007 through September 2008, in the Southern District of Florida and elsewhere, Sanchez and others conspired to recruit individuals who would be willing to purchase condominium units at Marina Oaks Condominiums. These buyers were promised a “buyer’s incentive” which in actuality was an indirect payment or “kick-back” to the buyers not disclosed to the lenders or reflected on any of the closing documents. Sanchez and others would then prepare materially false and fraudulent mortgage applications for the buyers on the Uniform Loan Application Form 1003 which contained false and fraudulent information as to material facts about the borrower’s credit worthiness in order to obtain mortgage money from lenders to fund the purchase of the Marina Oaks Condominiums. The conspirators would create false and fraudulent documents to support the mortgage applications. Once the loans closed, the conspirators would fraudulently and unlawfully divert portions of the mortgage proceeds for their own personal use and benefit.


Four Charged in Grant Funding Scam

January 30, 2015

Four persons have been charged with conspiracy and fraud for obtaining money from small business owners for grant funding and services that they never provided or intended to provide, announced U.S. Attorney Daniel G. Bogden for the District of FraudNevada and Laura A. Bucheit, Special Agent in Charge of the FBI for Nevada.

Jason Demko, 38, Lorraine Riddiough, 66, Lissette Alvarez, 27, all of Las Vegas, and Mark Jones, 32, of Barberton, Ohio, are charged in a criminal indictment with one count of conspiracy to commit mail fraud and wire fraud, five counts of wire fraud, and criminal forfeiture. Riddiough, Alvarez, and Jones were arrested in Las Vegas.

“Unfortunately, advance fee fraud schemes are very common,” said U.S. Attorney Bogden. “The con artist will ask for money up front before any tangible service or product is provided, and it will be very difficult to get your money back once you have turned it over to the scammers.”

“”These arrests emphasize the FBI’s continued commitment to investigate financial crimes,” said Special Agent in Charge Bucheit. “It also serves as a reminder for consumers to protect themselves, and remember if it seems too good to be true, it almost always is.”

According to the indictment and other court records, from about January 2013 to February 2014, the defendants allegedly made false and fraudulent representations and promises to small business owners to persuade and induce them to pay initial fees, usually between $2,500 and $5,000 for goods and services they thought would help them obtain grants for their businesses. The business owners were told that the total cost for obtaining a grant was between $10,000 and $15,000, depending on the total amount of funding requested, and that the remaining fees would not be charged until the owners received 100 percent of the grant funding. Among other things, the defendants falsely stated that they represented a company named Foundation Processing Center in Wilmington, Del., when in fact, they represented JCD Business Services in Las Vegas; falsely stated that only certain clients had qualified for grants, when in fact anyone who paid the fees were qualified by the defendants; and stated that they had obtained grants for other clients, when in fact they had not done so. The defendants also re-solicited clients for additional fees, including business plans, when they knew that the plans were not going to assist the clients in obtaining any grants. The defendants knew that the true purpose of their solicitations was to obtain funds to personally enrich themselves.

If convicted, the defendants face a maximum of 20 years in prison and a $250,000 fine on all counts.