FBI Los Angeles: “$11 Million Boiler Room Mail and Wire Fraud Indictment Unsealed Today”

October 2, 2013

The Federal Bureau of Investigation on October 1, 2013 released the following:

Owner, Manager, and Salesperson at Fraudulent Investment Venture Taken into Custody for Mail and Wire Fraud in Connection with $11 Million Fraudulent Oil and Gas Well Investment Scheme.

LOS ANGELES—Two men were taken into custody today by special agents of the FBI for their alleged involvement in an Orange County boiler room operation that defrauded investors by falsely claiming high returns from oil and gas wells and by failing to disclose high sales commissions on investments, announced Bill L. Lewis, Assistant Director in Charge of the FBI’s Los Angeles Field Office and André Birotte Jr., United States Attorney for the Central District of California. A third defendant charged in this indictment is already in custody on unrelated charges.

Jerry Aubrey, 51, already in custody, his brother Timothy Aubrey, 53, of Moreno Valley, who self surrendered to the FBI’s Riverside Resident Agency, and Aaron Glasser, 30, of Mission Viejo, who was arrested without incident, are all in custody today after a federal grand jury indictment that charges them with mail and wire fraud was unsealed.

The indictment alleges Jerry Aubrey founded, managed, and operated the telemarketing investment scheme (also known as a “boiler room”) located in Costa Mesa, CA, doing business as Progressive Energy Partners, LLC (PEP). Timothy Aubrey worked as a PEP manager and salesperson, in addition to preparing, with Aaron Glasser, the sales scripts read to potential investors. Finally, Aaron Glasser was a PEP salesperson who worked as both a sales “fronter” and “closer,” making cold calls and closing deals. In his work as a salesperson, the indictment alleges Glasser raised around a quarter of the total amount of investments.

PEP allegedly employed salespersons called “fronters” and “closers” to raise over $11 million in five unregistered securities offerings for the purported purpose of developing and supporting oil and gas wells. In reality, most of the money was used to pay for the Aubrey brothers’ personal expenses, to pay up to 30% commissions to salespersons, and to make Ponzi-like payments to previous investors.

The defendants directed salespersons to cold call potential investors from purchased lead lists and solicit investments using scripts touting the profitability of investing in PEP. Fronters would pass the names of those who were potentially interested to closers, who could conclude the sale.

As alleged in the indictment, the defendants caused the salespersons to make material misrepresentations and conceal material facts when speaking to investors about, among other things, the percentage of investor money that would be spent on the development and operation of oil and gas wells, the anticipated amount and timing of returns to investors, and the payment of sales commissions to PEP salespersons, i.e., the fronters and closers.

Some of the false and deceptive statements indicated that investors would receive a greater than 50% annual rate of return on their investments; that almost half of the investor funds would be spent on oil and gas wells, and that the remainder of the investor funds would be spent on other business expenses; that salespersons would only receive a sales commission in the form of a share of the investment profits; and that PEP would use the assistance of an “independent CPA firm” to make distributions to investors.

The indictment alleges that, through the scheme, the defendants concealed from investors the material facts that approximately 30% of the investor funds would be spent on the Aubreys’ personal expenditures; that almost 20% of the investor funds would be used to make investor distributions and to return investor principal; that less than 10% of investor funds was spent on oil and gas wells; that investors would not, in fact, earn an annual rate of return of over 50%; and that defendant Jerry Aubrey, rather than an “independent CPA firm,” would determine the distributions to investors. The indictment alleges that by devising, executing, and participating in the above scheme, the defendants induced more than 200 investors to distribute to PEP over $11 million between 2005 and 2010.

In 2011, the Securities and Exchange Commission (SEC) obtained summary judgment against these defendants in connection with the PEP investment scheme. Additionally, Jerry Aubrey was charged in 1998 by the SEC with violating the broker-dealer registration provisions of the Securities Exchange Act of 1934 in connection with an offering fraud in which he sold securities in a fictitious cruise ship. The following year, he was permanently enjoined from future violations of Section 15(a)(1) of the Exchange Act (failure to register as a broker dealer), a permanent injunction he has violated through his alleged activities in PEP.

If convicted on all eight counts of Mail Fraud and two counts of Wire Fraud, the defendants face a maximum statutory penalty of 200 years in federal prison.

The criminal investigation was conducted by the FBI. The Securities and Exchange Commission conducted the civil investigation.

An indictment itself is not evidence that the defendants committed the crimes charged. Every defendant is presumed to be innocent until and unless proven guilty in court.”

More Information on Federal Mail Fraud Statutes, Jury Instructions, and Crimes
Federal Mail Fraud Crimes – 18 U.S.C. § 1341

Video on Federal Mail Fraud Crimes

More Information on Federal Wire Fraud Statutes, Jury Instructions, and Crimes
Federal Wire Fraud Crimes – 18 U.S.C. § 1343

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

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To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Kenmore Financial Advisor Edward H. Kahler Arrested for Allegedly Committing Mail Fraud

October 2, 2013

The Federal Bureau of Investigation on September 30, 2013 released the following:

Allegedly Liquidated $125,000 Client Account Without Permission

A long-time financial advisor who was stripped of his insurance producers license in 2012, was arrested today on a federal charge of mail fraud for liquidating a client account without authorization, announced U.S. Attorney Jenny A. Durkan. EDWARD H. KAHLER, 64, is the owner of Key Resources, a Kenmore, Washington retirement consultation company which sells annuities and life insurance. The charge alleges that KAHLER used proprietary information from the company he used to represent to access customer accounts. KAHLER allegedly used that information to liquidate the customer account and use the money for his own benefit. KAHLER will make his first appearance in U.S. District Court in Seattle at 2:00 p.m. tomorrow, October 1, 2013.

According to the criminal complaint, from 1983 to 2007 KAHLER was a financial advisor for Variable Annuity Life Insurance Company (VALIC), and was appointed by VALIC to sell its annuities. VALIC terminated KAHLER in 2007 when it discovered he was promoting competing annuities. Using information that he had in his files, KAHLER allegedly created profiles for former clients using the VALIC on-line system, and fraudulently caused VALIC to liquidate the clients’ accounts and send the proceeds to him for his personal use and benefit. In the instance described in the complaint, on Christmas Eve 2012, KAHLER liquidated the account of a client who had died in 1984, and used the $125,000 to fund a trip to Las Vegas, the payment on a BMW and other personal expenses. He also paid business expenses with the money.

Mail fraud is punishable by up to 20 years in prison.

The charges contained in the complaint are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.

The case is being investigated by the FBI, U.S. Postal Inspection Service (USPIS) and the Social Security Administration Office of Inspector General (SSA-OIG). The case is being prosecuted by Assistant United States Attorney Justin Arnold.”

Federal Mail Fraud Crimes – 18 U.S.C. § 1341

Video on Federal Mail Fraud Crimes

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

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To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Former University at San Antonio Projects Manager Indicted by Federal Grand Jury in Connection with an Alleged Bribery Scheme

August 26, 2013

The Federal Bureau of Investigation (FBI) on August 23, 2013 released the following:

“A federal grand jury in San Antonio this week returned a bribery indictment against 41–year-old James Paul Council, a former project manager in the Facilities Department at the University of Texas at San Antonio, and three other San Antonio area residents in connection with a bribery scheme announced United States Attorney Robert Pitman and FBI Special Agent in Charge Armando Fernandez. As of today, all four defendants have surrendered to federal authorities.

The 17-count indictment charges Council; 47-year-old Alfredo Romero Gonzalez, owner of Power Source Electric, an electrical construction and repair business in San Antonio; 60-year-old Power Source Electric chief estimator and project manager Magin Villalon (a.k.a. “Buddy”); and Villalon’s wife, 56-year-old Sarah Anne Luna, with one count of conspiracy to commit bribery concerning programs receiving federal funds and four counts of mail fraud. Council is also charged with six counts of receiving a bribe; the other defendants, six counts of paying a bribe.

According to the indictment, from approximately August 2011 through September 2012, the defendants allegedly conducted a scheme to bribe a purchasing officer in order to secure UTSA construction contracts. The indictment further alleges that the defendants colluded in the submission of fraudulent, inflated bids to UTSA under the names of sham companies, GNZ Enterprise LLC and Vista Contracting, and fixed at least 40 UTSA contracts. Authorities estimate the submitted bids totaled more than $200,000. Furthermore, the indictment alleges that Council received cash, as well as improvements to his residence for his role in the scheme.

Upon conviction, the defendants face up to five years’ imprisonment on the conspiracy count, up to 10 years’ imprisonment for each bribery related count, and up to 20 years in federal prison for each mail fraud count. All four defendants are on bond pending further court proceedings.

This indictment resulted from an investigation conducted by the agents with the Federal Bureau of Investigation, together with the San Antonio Police Department and the University of Texas at San Antonio Police Department. Assistant United States Attorney James Blankinship is prosecuting this case on behalf of the government.

An indictment is merely a charge and should not be considered as evidence of guilt. The defendants are presumed innocent until proven guilty in a court of law.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

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To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Gerardo Blasi, Former New Jersey Turnpike Authority Manager, Charged with Allegedly Stealing More Than $120,000

July 1, 2013

The Federal Bureau of Investigation (FBI) on July 1, 2013 released the following:

“NEWARK, NJ—A former claims manager for the New Jersey Turnpike Authority was arrested today for allegedly stealing more than $120,000 from the authority, U.S. Attorney Paul J. Fishman announced.

Gerardo Blasi, 54, of Clifton, New Jersey, was arrested by special agents of the FBI and charged by complaint with mail fraud and defrauding a state agency that receives federal funds. He is scheduled to make his initial appearance later today before U.S. Magistrate Judge Cathy L. Waldor in Newark federal court.

According to the complaint:

Blasi was a claims manager at the New Jersey Turnpike Authority, responsible for negotiating and collecting payments from insurance companies whose insured drivers caused damage to the Turnpike. From April 2011 to June 2013, Blasi allegedly stole more than $120,000 from the authority in several ways, including instructing insurance companies to issue checks payable to fraudulent repair companies. When the checks were mailed to Blasi at the authority, he would arrange to have them cashed and keep a portion of the money for himself.

The fraud count with which Blasi is charged carries a maximum potential penalty of up to 20 years in prison and a $250,000 fine. The theft from a state agency count is punishable by a maximum potential penalty of up to 10 years in prison and a $250,000 fine.

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford, with the investigation leading to today’s charges. He also thanked the New Jersey Turnpike Authority for its cooperation in the investigation.

The government is represented by Assistant U.S. Attorney David L. Foster of the office’s Special Prosecutions Division in Newark.

The charges and allegations contained in the complaint are merely accusations, and the defendant is considered innocent unless and until proven guilty.”

Federal Mail Fraud Crimes – 18 U.S.C. § 1341

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

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To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Father and Son Allegedly Linked to Separate Federal Fraud Schemes Arrested at LAX as They Prepared to Leave U.S. with One-Way Plane Tickets to Russia

May 11, 2013

The Federal Bureau of Investigation (FBI) on May 10, 2013 released the following:

“LOS ANGELES— A father and son were arrested yesterday afternoon as they were about to board a plane to Moscow on federal fraud charges that include allegations that the older man sent tens of thousands of bogus “invoices” to small business owners in California in a shakedown scheme that caused at least 5,000 victims to send $225 to a fake company that purported to be a state agency.

The men—Viktor Ryzhkin, 45, of the Little Armenia section of Los Angeles; and his son, Evgenii Ryzhkin, 22, who lived with his father—were arrested late yesterday afternoon at Los Angeles International Airport by federal agents as they prepared to board a Transaero Airlines flight to Russia. The Ryzhkins, both of whom are Russian nationals, and two other family members, all had one-way tickets to Moscow that had been purchased on Monday.

According to a criminal complaint filed Thursday afternoon in United States District Court, Viktor Ryzhkin targeted more than 170,000 California small business owners in a mail fraud scheme that would have brought in nearly $40 million had all of the potential victims complied with demands to send payments to “Corporate Business Filings,” a Beverly Hills company set up and controlled by Viktor Ryzhkin.

The small business owners targeted in this scheme received invoices that appeared to be from the state of California, notifying them that they each owed $225 to the state and directing them to fill out certain forms related to their businesses. The letters sent to the victims—all of which were sent over the course of several days at the end of March and beginning of April—each listed the correct, publicly available California Small Business Administration entity number assigned to the particular small business. The business owners were told in the letters that they would face $250 penalties if they did not remit payment by April 15, 2013, and did not fill out the forms as directed. The letters and invoices that appeared to be from the state of California were completely bogus.

Investigators believe that Viktor Ryzhkin became aware of the investigation into his scheme in late last month. Viktor and Evgenii Ryzhkin, accompanied by the two family members, were about to board a plane at 4:00 p.m. yesterday, when they were arrested by United States Postal Inspectors.

Evgenii Ryzhkin was charged in a separate criminal complaint filed yesterday in United States District Court. Evgenii Ryzhkin is charged with participating in a conspiracy to take over home equity lines of credit in a scheme that caused at least $1.2 million in losses. According to the affidavit in support of the criminal complaint against Eygenii Ryzhkin, he was caught on surveillance video depositing a stolen check linked to a hijacked HELOC account.

Both Ryzhkins are expected to make their initial court appearances this afternoon in United States District Court.

Viktor Ryzhkin is charged in a criminal complaint with mail fraud, which carries a statutory maximum sentence of 20 years in federal prison.

Evgenii Ryzhkin is charged in a separate criminal complaint with bank fraud and conspiracy to commit bank fraud, each of which carries a statutory maximum sentence of sentence of 30 years in federal prison.

A criminal complaint contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until proven guilty in court.

This two cases against the Ryzhkins are being investigated by the United States Postal Inspection Service. The Federal Bureau of Investigations and U.S. Customs and Border Protection assisted during yesterday’s arrests.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

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To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Federal indictment charges 7 people in alleged $17 million multistate mortgage scams, Ponzi schemes

September 15, 2012

OregonLive.com on September 14, 2012 released the following:

“By The Associated Press

A federal indictment unsealed Friday charged seven people with running a multistate Ponzi scheme and related mortgage fraud scams that prosecutors said cost investors and lenders a combined $17 million.

The years-long investigation resulted in the arrest of 55-year-old Lawrence Leland Loomis. He and his father-in-law, John Hagener, 76, were charged with operating a fraudulent California-based investment fund that cost more than 100 investors more than $7 million.

Both men are from Granite Bay, a wealthy Sacramento suburb.

Hagener’s attorney, William Portanova, said his client would plead not guilty in federal court in Sacramento. It was not immediately clear if the others had retained attorneys.

Loomis and five other defendants are also charged in a 50-count indictment with costing lenders $10 million in losses through two mortgage fraud schemes.

Prosecutors said all three frauds were operated through Loomis Wealth Solutions, which was based in California and also worked with investors in Illinois, Washington and elsewhere from 2006 through 2008.

“We are bringing to justice some of those who are responsible for the mortgage crisis in this district and elsewhere,” U.S. Attorney Benjamin Wagner said in a statement announcing the indictments.

Portanova said the investigation was under way for at least four years before his client was charged.

“We’re looking forward to a resolution of this matter. It’s been a long investigation and we’re all ready to move forward,” Portanova said. “Large-scale, long-term white collar investigations are by their nature measured by calendars, not stopwatches.”

Loomis and Hagener were charged with bilking investors through a program called Naras Funds in 2007 and 2008. The indictment said Loomis encouraged investors to tap their home equity and retirement accounts to buy shares in the funds and to help purchase residential real estate.

He called the investments “simply the best financial plan ever created,” according to prosecutors.

He and his father-in-law allegedly promised 12 percent annual returns and said the funds were guaranteed, but the indictment claims the men used investors’ money to pay themselves, their companies’ operating expenses, and to prop up the scheme by paying later investors with money from earlier victims.

Loomis and Hagener had court appearances Friday, while the others were to appear later.

Loomis and a real estate appraiser, Darren Fehst, 44, of Halifax, Nova Scotia, are also charged in connection with a mortgage fraud scheme in which Loomis is accused of paying Fehst thousands of dollars to overstate appraisals so properties could be sold for inflated prices.

Loomis and four others also are charged with buying about 200 properties in Arizona, California, Florida and elsewhere while falsifying the sales prices and costing lenders about $10 million.

The others are Michael Llamas, 27, of Tracy; Peter Woodard, 54, of Ventura; Joseph A. Gekko, 43, of Yorba Linda; and Dawn C. Powers, 42, of Lincoln.

All are charged with mail and wire fraud. Each fraud charge carries a maximum possible sentence of 20 years in federal prison.”

Federal Mail Fraud Crimes – 18 U.S.C. § 1341

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

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To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Former Merrill Lynch Financial Advisor Arrested in Alleged Embezzlement Scheme

August 10, 2012

The Federal Bureau of Investigation (FBI) on August 9, 2012 released the following:

“TALLAHASSEE—Today James Ryan Lanier, 33, was arrested in San Diego, California, on fraud, money laundering, and identity theft charges relating to the embezzlement of more than $800,000 in funds from Merrill Lynch clients.

The 65-count indictment alleges that between 2008 and 2010, while working as a financial advisor at Merrill Lynch, Lanier transmitted fraudulent letters of authorization bearing forged client signatures to Merrill Lynch client associates who were responsible for processing wire transfers of client funds. The letters contained false and misleading statements designed to induce the client associates to wire transfer funds from client investment accounts to bank accounts held and controlled by Lanier. According to the indictment, Lanier purposely sought assistance from client associates who were unfamiliar with Lanier’s clients. In directing the transfers of these funds, Lanier falsely claimed that he had obtained voice approval from Merrill Lynch clients on a recorded telephone line. As alleged in the indictment, Lanier used the embezzled client funds to make loan payments and to purchase vehicles and a condominium in Albany, Georgia, as well as an interest in a cellular telecommunications business.

If convicted, Lanier faces maximum sentences of 30 years in prison on each count of wire and mail fraud and a maximum sentence of 10 years in prison for money laundering. If convicted of aggravated identity theft, Lanier faces a separate mandatory minimum sentence of two years in prison, which must be served consecutively to any other sentence.

Lanier will be formally arraigned at an initial appearance currently set for August 16, 2012, at 1:30 p.m., before United States Magistrate Judge Charles A. Stampelos in Tallahassee.

The government’s case is being prosecuted by Assistant U.S. Attorney Jason Coody.

An indictment is merely an allegation by a grand jury that a defendant has committed a violation of federal criminal law and is not evidence of guilt. All defendants are presumed innocent and entitled to a fair trial, during which it will be the government’s burden to prove guilt beyond a reasonable doubt in a court of law.”

Federal Mail Fraud Crimes – 18 U.S.C. § 1341

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

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To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Indictment Charges Madison Business Owner with Alleged Fraudulent Art Sales

August 9, 2012

The Federal Bureau of Investigation (FBI) on August 8, 2012 released the following:

“David B. Fein, United States Attorney for the District of Connecticut, and Kimberly K. Mertz, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation, announced that a federal grand jury sitting in New Haven returned a 12-count indictment today charging David Crespo, 58, of Guilford with mail fraud and wire fraud offenses stemming from his alleged sale of fraudulent artwork.

The indictment alleges that, from approximately 2005 to February 2011, Crespo, an art dealer who conducted business under the name Brandon Gallery in Madison, defrauded his customers by representing that artwork he sold were original pieces by Pablo Picasso and original signed lithographs by Marc Chagall. Crespo also created documents that falsely supported the provenance of the artwork, which he then provided to customers.

The indictment charges Crespo with nine counts of wire fraud and three counts of mail fraud. If convicted, he faces a maximum term of imprisonment of 20 years on each count.

Crespo has been released on a $50,000 bond since his arrest on April 3, 2012.

U.S. Attorney Fein stressed that an indictment is not evidence of guilt. Charges are only allegations, and each defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.

This matter is being investigated by the Federal Bureau of Investigation and the Madison Police Department. The case is being prosecuted by Assistant United States Attorney Anthony E. Kaplan.”

Federal Mail Fraud Crimes – 18 U.S.C. § 1341

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

————————————————————–

To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Joe H. Nichols Charged in a Criminal Complaint Alleging Mail Fraud Crimes in Connection with Charitable Donations from the Veterans of Foreign Wars of the United States (VFW)

June 18, 2012

The Federal Bureau of Investigation (FBI) on June 15, 2012 released the following:

“Houston Man Charged with Defrauding Veterans of Foreign Wars Organization

HOUSTON— Joe H. Nichols has been arraigned on a one-count criminal information charging him with mail fraud in connection with charitable donations from the Veterans of Foreign Wars of the United States (VFW), United States Attorney Kenneth Magidson announced today. Nichols, 46, of Houston, appeared today before U.S. Magistrate Judge Stephen Smith.

The VFW is a charitable organization that supports veterans and active duty personnel who have or are serving in the United States military overseas. According to the allegations in the criminal information, the VFW agreed to fund a communication project that would allow soldiers deployed in remote locations in Iraq to communicate with their families. Nichols allegedly agreed to assist the VFW by having his company, Prasolus, serve as project manager to get the communication hardware and software to Iraq.

The Texas VFW raised approximately $182,000 for the communication project, from which Nichols submitted invoices for payment. In June 2007, he allegedly traveled to the national headquarters of the VFW in Kansas City and induced the national VFW to give him an additional $100,000, which he said he needed to complete the communication project and deploy it to Iraq. Although the national VFW mailed a check to Nichols for $100,000, the communication system was never delivered. Instead, he allegedly used funds from the $100,000 for his personal benefit.

Judge Smith permitted Nichols to remain free with the execution of a $50,000 unsecured bond under the condition he surrender his passport and travel only within the continental United States.

The maximum penalty upon conviction for mail fraud is 20 years in prison and a possible $250,000 fine.

The investigation leading to the charges was conducted by the FBI. Assistant United States Attorney Belinda Beek is prosecuting the case.

A criminal information is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

————————————————————–

To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Chicago Man Indicted for Allegedly Causing 15 Investors to Lose Approximately $600,000 in Ponzi-Type Fraud Scheme

June 6, 2012

The Federal Bureau of Investigation (FBI) on June 6, 2012 released the following:

“CHICAGO— A Chicago man who operated an investment trading pool allegedly fraudulently obtained approximately $1.4 million and caused some 15 individual investors to lose about $600,000, federal law enforcement officials announced today. The defendant, Christopher Varlesi, was charged with six counts of mail and wire fraud in an indictment returned yesterday by a federal grand jury. Varlesi allegedly misappropriated a substantial portion of investor funds for his own benefit, including misusing $99,750 in May 2010 to pay for a year’s rent for an apartment in the Trump International Hotel and Tower in Chicago and to make Ponzi-type payments to other investors.

Varlesi, 53, of Chicago, will be arraigned at a later date in U.S. District Court. He was the sole proprietor of Gold Coast Futures & Forex, which purported to buy and sell securities and commodities and operate a pool of investor money for trading purposes but was not actually registered or licensed to do so. The indictment seeks forfeiture of approximately $600,000.

The charges were announced by Patrick J. Fitzgerald, United States Attorney for the Northern District of Illinois, and Robert D. Grant, Special Agent in Charge of the Chicago Office of the Federal Bureau of Investigation. The Illinois Securities Department assisted in the investigation, as did the Commodity Futures Trading Commission, which filed a civil enforcement lawsuit against Varlesi in March of this year.

According to the indictment, between July 2008 and January 2012, Varlesi made false representations to clients about using their money to trade gold, commodity futures, and foreign currency, the expected return on their investments, and the security of their money. He fraudulently retained investors’ funds and concealed the scheme by creating and distributing false account statements and making Ponzi-type payments to investors, the charges allege. Varlesi also allegedly told clients that their investments were guaranteed to be profitable, with no risk of losing principal. As part of the scheme, the charges allege that he provided promissory notes to certain investors, falsely promising to return the entire principal amount of their investment, as well as guaranteed interest ranging between five to 7.5 percent per month.

The government is being represented by Assistant U.S. Attorney Sarah E. Streicker.

Each count of wire and mail fraud carries a maximum penalty of 20 years in prison and a $250,000 fine, and restitution is mandatory. The court may also impose a fine totaling twice the loss to any victim or twice the gain to the defendant, whichever is greater. If convicted, the court must impose a reasonable sentence under federal sentencing statutes and the advisory United States Sentencing Guidelines.

The investigation falls under the umbrella of the Financial Fraud Enforcement Task Force, which includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch and, with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information on the task force, visit: http://www.stopfraud.gov.

An indictment contains only charges and is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

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Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.