Men Indicted For Allegedly Defrauding Lions Gate Entertainment

March 26, 2012

The Federal Bureau of Investigation (FBI) on March 24, 2012 released the following:

“LOS ANGELES—Two men were arrested Friday by special agents with the Federal Bureau of Investigation and Internal Revenue Service-Criminal Investigation after being indicted for their roles in a $2 million kickback scheme involving the Santa Monica-based film and distribution company Lions Gate Entertainment (Lionsgate), announced André Birotte, Jr., United States Attorney for the Central District of California; Steven Martinez, the Assistant Director in Charge of the FBI’s Los Angeles Field Office; and Leslie P. DeMarco, Special Agent in Charge of IRS Criminal Investigation in Los Angeles.

Roccio James Cuccia, 31, of Downey; and Larry D. Collins, 50, of Northridge, were charged in a 14-count indictment returned by a federal grand jury in Los Angeles on Thursday, March 22, 2012. The indictment includes allegations of wire fraud, money laundering, and tax evasion.

According to the indictment, Cuccia started working as a senior buyer at Lionsgate in January 2006 and was responsible for acquiring cardboard advertising used to display Lionsgate DVDs and Blu-ray Discs at retail stores. Cuccia is alleged to have used Collins as a vendor to supply the display cases to retail stores from 2006 through 2011.

Cuccia and Collins allegedly devised a scheme whereby Lionsgate was overbilled for the number of display cases provided by Collins. The indictment alleges that by accessing Lionsgate’s computer system, Cuccia would inflate the number of previously approved display cases ordered from Collins by Lionsgate. Collins would then generate fraudulent invoices for the inflated purchase orders, the indictment alleges.

Lionsgate sent payment for the inflated purchase orders to a third party, who would then wire a substantial percentage of the Lionsgate funds to Collins. The indictment alleges that Collins would then wire a portion of these funds to Cuccia’s bank account. The indictment alleges that Cuccia and Collins caused losses to Lionsgate totaling approximately $2,064,000.

The indictment lists 10 wire transfers totaling over $745,000, which represents funds received by Collins as part of the scheme, a portion of which were then wired to Cuccia. Cuccia is alleged to have used part of the funds to purchase a 2007 Toyota Camry Hybrid and a 2006 Mercedes Benz R350, both of which were seized on Friday by federal agents. The indictment further alleges that Cuccia failed to report his portion of the fraudulently received funds as income on his 2006 and 2007 federal tax returns.

Cuccia and Collins are each charged with 10 counts of wire fraud. In addition, Cuccia is charged with two counts of conducting a monetary transaction in criminally derived property of a value greater than $10,000 and two counts of subscribing to false tax returns.

Cuccia and Collins had an initial appearance before a federal magistrate in U.S. District Court in Los Angeles Friday afternoon and were granted bond.

If convicted of all charges alleged in the indictment, Cuccia faces a statutory maximum sentence of 226 years in federal prison, and Collins faces 200 years in federal prison.

This investigation was conducted by the Federal Bureau of Investigation, IRS-Criminal Investigation, and the Santa Monica Police Department. Lions Gate Entertainment cooperated with the investigation.

An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.”

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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 Crimes Watch 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 and OFAC SDN Sanctions Removal.

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.


FBI Arrests Two For Allegedly Defrauding Lionsgate Entertainment in a Kickback Scheme

March 26, 2012

Chicago Tribune on March 26, 2012 released the following:

“FBI arrests two for defrauding Lionsgate

Joshua L. Weinstein
Reuters

LOS ANGELES (TheWrap.com) – The FBI has arrested two California men on charges of defrauding Lionsgate Entertainment of more than $2 million in a kickback scheme that bought one of them a Mercedes, the bureau said Saturday.

Roccio James Cuccia, 31 of Downey, worked at Lionsgate as a senior buyer.

He and Larry D. Collins, of Northridge, had a kickback scheme that cheated the studio out of more than $2 million.

Cuccia, who joined Lionsgate in 2006, bought cardboard advertising for Lionsgate DVD and Blu rays at retail stores. The FBI says Cuccia used Collins as a vendor, supplying display cases to retail stores for five years.

In an indictment filed in U.S. District Court in Los Angeles on Thursday, federal prosecutors say that after the Lionsgate marketing department asked for display cases, Cuccia would go into the company’s computer system and change the number of cases requested.

He would then tell Collins, who would generate phony invoices, according to the indictment.

Lionsgate paid the inflated purchase orders to a third party, who gave much of that money to Collins, the FBI says.

“Collins would kick back a portion of these funds to … Cuccia by wiring money into … Cuccia’s bank account,” the indictment says. “Cuccia and Collins caused losses totaling approximately $2,064,000.”

The FBI says Cuccia used part of the money to buy a 2007 Toyota Camry Hybrid and a 2006 Mercedes Benz R350. Federal agents seized both cars on Friday.

The indictment also accuses Cuccia of failing to report the income on his 2006 and 2007 income tax statements.

Cuccia and Collins each are charged with 10 counts of wire fraud. Cuccia is also charged with two counts of “conducting a monetary transaction in criminally derived property of a value greater than $10,000,” and two counts of filing false tax returns.

The two appeared before a U.S. magistrate in federal court in Los Angeles Friday and were released on bond.

If convicted, Cuccia faces up to 226 years in prison and Collins faces up to 200 years in federal prison.

The FBI, IRS and Santa Monica Police Department conducted the investigation with the cooperation of Lionsgate.

The arrest came on the same day that Lionsgate released its biggest movie ever, “The Hunger Games.””

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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 Crimes Watch 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 and OFAC SDN Sanctions Removal.

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.