Need to Know Recent Cases – 2 July

Sacred Honor Lost

BRIBERY/KICKBACKS

Prison Sentences and More Than $500,000 in Fines For Contractors Who Bribed the ‘Godfather’ of Camp Pendleton 

The presidents of two government contracting companies, as well as the companies themselves, were sentenced today for bribing the so-called “Godfather” of Camp Pendleton in exchange for millions of dollars in construction and service contracts at Camp Pendleton and other federal facilities.

National Guard Official Pleads Guilty to Accepting Bribes to Award Freight Contracts to Companies 

According to Wooten’s plea agreement with the government, he overrode the electronic system that generated a list of “Best Value Carriers” for freight shipments so that he could manually select a company for a shipment. Between September 2011 and January 2012, Wooten manually awarded 55 contracts to two Tuscaloosa-area companies, identified as C.E. and U.S.T. The freight broker who worked as an agent for both companies paid Wooten about 25 percent of his commissions on the freight contracts in return for Wooten awarding them to his companies. The agent received about $115,882 in commission on the 55 contracts and paid about $29,742 in bribes to Wooten, according to the plea agreement.

Former County Assistant District Attorney Sentenced to Federal Prison in Bribery Scheme 

Reyes admitted that from March 30, 2011, until April 15, 2011, he conspired with others through text messaging to accept cash bribes in exchange for dismissing pending criminal cases.

Subcontractor Sentenced for Conspiracy to Commit Bribery 

Smith was the co-founder and president of a contracting company located in Chesapeake, Virginia, that sought contracting business from the United States Navy Military Sealift Command. In approximately November 2004, Smith joined an extensive bribery conspiracy that spanned four years, involved multiple co-conspirators, including two different companies, and resulted in the payment of more than $265,000 in cash bribes, among other things of value, to two public officials performing work for the Military Sealift Command, Kenny E. Toy and Scott B. Miserendino, Sr. In exchange for the bribe payments, Smith’s business, referred to as Company A in court documents, received lucrative business from the Military Sealift Command that amounted to approximately $3 million in task orders during the time period of the conspiracy.

Federal Grand Jury Indicts Former Judge on Bribery, Extortion, and Wire Fraud Charges 

McGinty allegedly solicited and accepted bribes from Alberto Acevedo, Jr., an attorney in San Antonio, in exchange for favorable judicial rulings that benefited Acevedo and his clients. The indictment alleges that Acevedo’s bribes to McGinty included cash, car repairs, arranging the sale of McGinty’s vehicle, and registering a vehicle purchased by McGinty. In exchange, McGinty allegedly provided the favorable judicial rulings requested by Acevedo, including lenient sentences and less restrictive conditions of release for Acevedo’s clients. McGinty allegedly received gifts, payments, and other things of value totaling more than $6,655 from Acevedo during the course of the conspiracy.

Former Employee at County Clerk’s Office Pleads Guilty to Bribery 

Lorris Upshaw, III, 30, of Detroit, a clerk in the Wayne County Clerk’s Office during 2009 and 2010, pleaded guilty before U.S. District Judge Robert H. Cleland to accepting bribes in exchange for issuing Concealed Pistol Licenses to individuals who were not otherwise eligible to receive such licenses. 

EMBEZZLEMENT

Former Federal Express Employee Sentenced to 41 Months in Federal Prison for Stealing Suspected Drug-Related Cash 

Chavez was employed by Federal Express for four years as a driver and was responsible for unloading FedEx packages from aircrafts at the Medford, Oregon airport and delivering them to their ultimate destinations. In 2011 and 2012 Chavez engaged in a scheme by identifying packages he believed contained large quantities of cash—suspected by law enforcement to be the proceeds of marijuana sales—as well as electronic equipment, jewelry and other valuable items. Once identified, Chavez reprinted FedEx labels, re-routing the targeted packages to his truck, enabling him to steal the packages. Chavez sold stolen electronics and other items to his friends and associates.

Former Employee Sentenced for Stealing $289,000 from Bank 

Lisa Marie Evans, 43, Wichita, Kan., pleaded guilty to one count of embezzlement. In her plea, she admitted that from 2011 to 2013 she stole the money while working for Southwest National Bank in Wichita. She was responsible for balancing the bank vault on a daily basis. A surprise audit in April 2013 revealed the theft. Investigators examined security footage of the vault that showed Evans taking money from the vault and hiding it on her person.

Former Board Member of National Charity Charged in $4 Million Fraud and Money Laundering Scheme 

Former Bank Employee Stole More Than $2.5 Million from Bank 

In her plea, she admitted she stole the money over a period of 10 years while working as operations supervisor at Girard National Bank. Bright used several different methods to steal the money. In some cases, she wrote checks on her own accounts and altered electronic bank records so the checks would clear but the money would not be taken out of her account. In other cases she removed paper checks and altered records to post checks to other accounts. She diverted funds from the bank’s accounts to her own accounts, and she wrote large counter checks to conceal losses.

Director of Domestic Violence Shelter Pleads Guilty to Stealing Funds 

Wallace admitted that she embezzled money from Lighthouse, including money obtained from grants funded by the U.S. Department of Justice. Over a five-year period from 2008 through 2013, Wallace used Lighthouse credit cards to pay personal expenses. Wallace also made unauthorized payments on personal credit cards and her personal cell phone from the Lighthouse bank account.

Woman Sentenced for Embezzling $320K from Businesses 

Greany worked as a bookkeeper for two computer systems design and consulting businesses. Between 2006 and 2012, she stole nearly $320,000 from the two companies. Among other things, Greany used a company credit card to make unauthorized charges for personal expenses, including travel, tickets to sporting events and theater productions, restaurant meals and tuition, as well as the costs of operating her photography business. She then paid those charges with corporate funds from both companies. Greany also transferred money from the businesses’ bank accounts to pay her personal credit card bills. Additionally, Greany had the payroll processing company for the victim companies issue payments to her as reimbursement for expenses, which had actually been incurred by other employees, as well as increased salary payments for herself. She also wrote two unauthorized checks on a company account which she used for her own purposes.

Treasurer Sentenced for Embezzling $1.5 Million 

Kolkmeyer told investigators that he used the money he had stolen by doing $50,000-$60,000 in remodeling of his house. Kolkmeyer also stated he purchased various vehicles over the course of the time that he would not have been able to purchase without the money. Kolkmeyer also stated he helped his daughter remodel her home for about $25,000-$30,000. Kolkmeyer stated he helped with his son’s wedding expenses and estimated that each wedding for his children cost $40,000-$50,000. Kolkmeyer also told investigators that he did not declare any of the stolen income to the IRS.

Former Visa Consultant Pleads Guilty to Federal Charge for Embezzling More Than $245,000 from Employer 

Kpakima worked from May 2011 until November 2012 as a visa consultant for a company identified in court documents as “Company A,” a visa processing company that focused on obtaining expedited visas for individuals and corporate clients across the United States. Kpakima performed visa processing and expediting duties, and he was able to request money orders from his supervisors through the company’s money order machine. He was required to provide a reason to supervisors for the money orders. Between May 2011 and November 2012, Kpakima fraudulently requested more than 2,900 money orders, which he then cashed at various establishments. He gave the establishments various reasons why he had the money orders, including a false claim that he got them in return for delivering passports.

Former Head of Federal Credit Union Indicted 

Newcomb and Humphries originated loans in the names of LFCU members without those members’ knowledge or consent. Newcomb and Humphries drafted fictitious loan documentation and approved the fictitious loans in order to make false loans look legitimate.

In addition, the indictment alleges that Newcomb entered into Loan Participation Agreements with another federal credit union. In furtherance of the loan participation scheme, Newcomb, on behalf of LFCU, sold various fraudulent loans. In order to persuade the partner credit union to enter into the Loan Participation Agreement, Newcomb made various false statements to make the loans involved appear to be authentic and legitimate. The value of the fraudulent loans involved in the loan participation scheme was in excess of $1 million.

The indictment also alleges that Newcomb and Humphries transferred funds and wrote checks on certain LFCU members’ accounts without their knowledge or consent.

Jody Farnham Imprisoned for Embezzlement from University of Vermont 

Farnham began embezzling money from UVM in about 2006, and, before the thefts were discovered in late 2012, she stole not less than $200,000. Farnham embezzled much of the money by altering checks given to her by VIAC enrollees. She changed the checks, which were made out to VIAC, to make her a co-payee. She then deposited the forged checks into her personal bank account. Farnham also stole some cash tuition payments and misused UVM credit cards to make personal purchases. During the time period of the embezzlement, UVM received substantial amounts of federal funding.

FRAUD

Two Men Charged with Defrauding Delta and Northwest Airlines of $22 Million 

The indictment alleges that, from at least 2004 through 2013, Anderson was involved with Yedor in a scheme to defraud Northwest and, later, Delta, by submitting numerous false invoices on behalf of a company, Airborne Voice and Data, purportedly owned by Yedor. The invoices sought payment from the airlines for goods provided and services supposedly rendered by Airborne Voice and Data, when in fact, both Anderson and Yedor knew that Yedor’s company had not provided any such goods or services.

The indictment also alleges that Yedor sent the invoices to Anderson to be approved. Anderson approved the fraudulent invoices, which caused the airlines to issue payments to Airborne Voice and Data. In exchange for approving each of the invoices, Anderson received a portion of the proceeds of the fraud. The indictment alleges that Yedor and Anderson caused Northwest and Delta to issue approximately $22 million in payments to Airborne on the basis of the false invoices between 2004 and 2013.

Contractor Sentenced for Conspiring to Defraud HUD 

Former Federal Bureau of Prisons Employee Convicted of Fraudulently Obtaining Federal Workers Compensation Benefits

Seifer was charged in a five-count indictment alleging that he had submitted over 1,380 fraudulent claims seeking reimbursement from the federal government for mileage expenses that he falsely claimed to have incurred by driving to health clubs for rehabilitation. The indictment alleges that Mr. Seifer did not, in fact, travel to the health clubs on many of his claimed dates of travel between March 28, 2006, and October 2, 2012, for which Mr. Seifer sought and received reimbursement of travel expenses totaling in excess of $84,000.

State Auditor Pleads Guilty to Theft from a Federal Program 

GOSTON was employed with DCFS’s Bureau of Auditing and Compliance Services which was responsible for safeguarding assets against theft and unauthorized use; ensuring that transactions were properly authorized and recorded; and ensuring compliances with management policies, as well as federal and state laws and regulations. During the period she was employed with this department, DCFS received over a billion dollars annually in federal funds.

At yesterday’s hearing, GOSTON admitted to submitting fraudulent reimbursement receipts to receive money for official state travel that did not occur. The fake receipts which were submitted were signed both by GOSTON and by DCFS Audit Director, Delrice Augustus, who also recently pled guilty as part of this scheme. When the requested amount of reimbursement would be received, GOSTON and Augustus would split the fraudulent payments. Augustus has been charged and pled guilty for his role in this and related fraudulent conduct.

OTHER

Man Pleads Guilty to Computer Hacking and Credit Card Theft 

A Massachusetts man pleaded guilty today to hacking into computer networks around the country—including networks belonging to law enforcement agencies, a local police department and a local college—to obtain highly sensitive law enforcement data and alter academic records. He also pleaded guilty to obtaining stolen credit, debit and payment card numbers.

Air Force Non-Commissioned Officer at Andrews AFB Sentenced to 120 Years in Prison for Sexually Exploiting Toddlers and Children to Produce Child Pornography 

Department of Defense Contractor Pleads Guilty to Production of Child Pornography 

Tampa Man Pleads Guilty to Production of Child Pornography on MacDill Air Force Base 

Mail Carrier Arrested for Theft of Mail and Treasury Checks