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Former Jacksonville Tech CEO Indicted on Wire Fraud and Money Laundering Charges

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marvin-meyer-SYTO3xs06fU-unsplash-300x200The U.S. Attorney’s Office for the Middle District of Florida has announced charges against a former CEO of a Jacksonville tech company who is accused of using the company to commit fraud and money laundering.

Jason Cory, 47, of Jacksonville, FL, was indicted last week on three counts of wire fraud and one count of money laundering. Attorney information was not available.

According to sources, Cory was the founder and CEO of a Jacksonville-based information technology services company called SharedLabs Inc. From March 2017 to March 2019, he is accused of embezzling over $540,000 by authorizing wire transfers out of SharedLabs’ corporate accounts and into the account of a company called Gambit Matrix LLC. He allegedly told his employees that Gambit had performed consulting services for SharedLabs.

Records show that Gambit Matrix was a shell company under Cory’s control. He established the company in January 2015, but it never performed any “legitimate, substantive business activities” before it was dissolved in September 2016, the indictment states. Cory still controlled the bank account into which the embezzled funds from SharedLabs were transferred. He used the money for personal expenses, such as Super Bowl tickets and the $11,630 purchase of a gold Rolex watch, according to the indictment.

Cory reportedly attempted to conceal the alleged embezzlement by lying to SharedLabs employees and board members about his control of Gambit. He allegedly tried to persuade people to pose as the fictitious owners of Gambit and went as far as making fake social media profiles and email addresses for them. He also doctored an invoice and contract between Gambit and SharedLabs to substantiate the consultation work the company had purportedly performed, the indictment claims.

Wire fraud is a criminal offense that involves intentionally initiating a fraud scheme in order to obtain money or property through the use of interstate “wires.” The alleged wire transfers that Cory authorized were made from Florida to North Carolina, making them interstate transfers, hence why prosecutors are charging him with wire fraud.

Wire fraud is a federal crime that is often investigated by the Federal Bureau of Investigation (FBI) or similar federal agencies. The Department of Justice often files wire fraud charges in conjunction with the prosecution of money laundering because wire fraud is one of the easiest crimes for an assistant U.S. Attorney to prosecute.

If convicted, Cory faces up to 20 years in federal prison for each count of wire fraud and up to 10 years in prison for the money laundering offense. Prosecutors are also seeking the forfeiture of at least $558,701—the proceeds of Cory’s alleged criminal conduct.

Anyone accused of committing wire fraud and money laundering in Florida should immediately consult an experienced attorney. A competent attorney can review the evidence, conduct an independent investigation, and help the accused choose the best course of action to minimize the potential penalties or have the charges dropped.

South Florida Fraud Defense Attorney

Are you accused of committing wire fraud and money laundering in South Florida? Contact Brian Silber, P.A. to set up a free initial consultation with one of South Florida’s most experienced fraud defense attorneys.

Source: 8.13.20 Former CEO charged with wire fraud and money laundering.pdf

One South Florida Man, Two Others Charged for Using Shell Companies to Exploit COVID-19 Relief Programs

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mika-baumeister-6jI4JwI64JI-unsplash-300x200Three men have been charged by federal prosecutors in South Florida for allegedly participating in a fraud and money laundering scheme that stole an estimated $2 million from coronavirus (COVID-19) relief programs.

Jimpcy One of Broward County, FL, Gousman Lemy of Norfolk County, MA, and Frantz Guillaume of Suffolk County, MA, were charged with conspiracy to commit money laundering, bank fraud, and money laundering. One and Guillaume were additionally charged with aggravated identity theft and making false statements to a financial institution. It is unclear if any of the named defendants have acquired the services of an attorney.

According to the affidavit, One, Lemy, and Guillaume allegedly participated in two separate fraud schemes in 2019 and 2020. The first alleged scheme occurred in early 2019, when unknown co-conspirators of the defendants purportedly hacked and took control of a business email account. The co-conspirators used the email account to send fake emails to a separate business, which they tricked into wiring over $912,000 into an account the defendants allegedly controlled.

One, Lemy, and Guillaume attempted to launder the money by transferring it into the bank accounts of various shell companies they controlled, the complaint alleges. They further concealed the origin of the money by transferring it out of those accounts and into accounts controlled by the unnamed co-conspirators.

The second alleged fraud scheme occurred in 2020, when the COVID-19 pandemic hit the U.S. The defendants allegedly initiated a new fraud scheme using the shell companies from the first scheme, as well as newly created and reactivated shell companies. One, Lemy, and Guillaume are accused of submitting fraudulent loan applications to two federal COVID-19 relief programs: the Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan Program (EIDL).

PPP and EIDL loans for small American businesses are authorized under the Coronavirus Aid, Relief, and Economic Security (CARES) Act that was enacted by Congress on March 29, 2020. The CARES Act was designed to provide emergency financial assistance to the millions of Americans who are struggling with the economic effects of the coronavirus pandemic. Congress has authorized over $500 billion in forgivable loans for small businesses to use for job retention and other business-related expenses.

One, Lemy, and Guillaume allegedly submitted loan applications using the names of the shell companies and were able to obtain almost $2 million in PPP and EIDL funds, sources indicate. It is unclear if they used the funding for the business-related expenses stipulated in the CARES Act.

South Florida business owners who are suspected of committing fraud related to federal COVID-19 relief programs should immediately consult an experienced fraud defense attorney. An attorney can review the evidence and conduct an independent investigation to determine the best course of action to minimize potential penalties, or have the charges dropped altogether.

South Florida Fraud Defense Attorney

Are you accused of committing fraud involving federal COVID-19 relief programs in South Florida? Contact Brian Silber, P.A. to set up a free initial consultation with one of South Florida’s most experienced fraud defense attorneys.

Source: 8.7.20 three men who allegedly used existing shell companies to exploit coronavirus relief programs charged in court.pdf

California Construction Worker Accused of Committing Workers’ Compensation Fraud

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greyson-joralemon-A1g0oeX29ec-unsplash-300x169A California construction worker who allegedly claimed the injuries he suffered in a fight were work-related has been arraigned in Merced County Superior Court for workers’ compensation insurance fraud.

Meliton Hernandez Martinez Jr., 23, of Atwarter faces felony counts of insurance fraud and a misdemeanor count of filing a false police report. It is unclear if he has acquired the services of an attorney.

According to a news release, Hernandez Martinez filed a workers’ compensation claim with his employer and allegedly provided false statements about the circumstances that led to his injury.

It is unclear when or where the alleged injury occurred, but an investigation by the California Department of Insurance revealed that he had allegedly made inappropriate gestures to an unnamed woman in the parking lot during his mid-morning break and was confronted by her boyfriend, a U.S. Marine, who reportedly told him to be respectful. Surveillance footage from the parking lot purportedly shows Hernandez Martinez, without provocation, punching the Marine in the face multiple times. He was then stabbed in the abdomen and the arm, which investigators later determined to have done in self-defense, sources indicate.

Hernandez Martinez had to be airlifted to a local hospital for treatment. He allegedly filed a workers’ compensation claim with his employer to have his medical bills covered, claiming his injuries were inflicted while he was on the job. However, his claim was later denied by his employer’s insurer after the Department of Insurance discovered that he was the initial aggressor in the fight, and toxicology results revealed he was allegedly under the influence of alcohol and cannabis at the time of the incident.

Hernandez Martinez’s case is being prosecuted by the Merced County District Attorney’s Office. The press release announcing his arraignment noted that these allegations are merely accusations and that the accused is presumed innocent until proven guilty through court proceedings.

Workers’ compensation is an insurance fund that covers an injured worker’s medical bills, temporary or permanent disability benefits, portion of lost income, cost of physical rehabilitation, and sometimes even death benefits for the next of kin of a worker killed while on the job.

Almost every state requires businesses to operate with workers’ compensation insurance with specific rules on how compensation claims, payments, legal proceedings, and procedures function. Making this type of insurance mandatory incentivizes businesses to keep their workers safe and reduces the risk of civil litigation against employers.

Making false statements and committing fraud to obtain compensation benefits is a severe offense with penalties that can include prison time and hefty fines. Anyone suspected of committing workers’ compensation fraud should immediately consult an experienced attorney who can review the evidence and plan the best course of action to minimize the potential penalties.

South Florida Workers’ Comp Fraud Attorney

Are you accused of committing workers’ compensation fraud in Florida? Contact Brian Silber, P.A. to set up a free initial consultation with one of South Florida’s most experienced workers’ compensation fraud attorneys.

Source: 8.11.20 Atwater construction worker arraigned for workers’ comp insurance fraud.pdf

Massachusetts Doctor, Wife Accused of Illegally Importing Meds from China

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pexels-photo-208512-300x200The U.S. Attorney’s Office for the District of Massachusetts has announced charges against a psychiatrist and his wife for their alleged involvement in a scheme to illegally import medication for alcohol and opioid dependence from China.

Dr. Rahim Shafa, 62, and his wife, Nahid “Nina” Tormosi Shafa, 62, both of Lexington, were indicted on one count of international money laundering conspiracy. Rahim Shafa faces additional charges of money laundering, conspiracy to defraud the United States, importing merchandise contrary to law, and receiving and delivering misbranded drugs with an intent to defraud and mislead. It is unclear if they have acquired legal representation.

According to the indictment, Shafa was a psychiatrist who owned and operated Novel Psychopharmacology, which has offices in Milford and Natick. His wife was reportedly the office manager. From January 2008 to January 2018, the Shafas are accused of illegally importing medication from Hong Kong to sell to patients.

Prosecutors allege the Shafas purchased disulfiram pellet implants, disulfiram injections, and naltrexone pellet implants. Disulfiram and Naltrexone are approved by the Food and Drug Administration (FDA) for treatment of alcohol and opioid dependence, but the forms of the medications the Shafas allegedly purchased were not FDA approved.

“In order to make money, the defendants allegedly circumvented mandatory FDA drug inspections and took advantage of vulnerable patients who sought to escape addiction through legitimate treatment,” said U.S. Attorney Andrew E. Lelling.

The indictment further alleges that Shafa conspired to defraud the U.S. by falsifying shipping documents to make the packages he shipped to his offices look like legal imports. For instance, the packages containing naltrexone pellet implants were falsely declared as “plastic beads in plastic tubes” in shipping documents.

“Distributing illegally imported prescription drugs of unknown origin and ingredients instead of FDA-approved drugs places the U.S. public health at risk,” said Jeffrey J. Ebersole, Special Agent in Charge of the FDA Office of Criminal Investigations. “We will continue to work with our law enforcement partners and bring to justice those who attempt to subvert FDA requirements, which are designed to ensure the safety and quality of drugs to American consumers.”

The investigation into the Shafas’ alleged conduct was performed by Massachusetts U.S. Attorney Lelling, Ebersole, Superintendent Christopher Mason of the Massachusetts State Police, and Michael Shea, Acting Special Agent in Charge of Homeland Security Investigations. Assistant U.S. Attorney John T. Mulcahy is listed as the lead prosecutor.

Money laundering and conspiracy to commit money laundering are serious offenses. If convicted, the Shafas face a maximum prison sentence of up to 20 years in prison and fines as high as $250,000. Conspiracy to defraud the United States carries a sentence of up to five years in prison and a fine of $250,000. Illegally importing merchandise carries a sentence of up to 20 years in prison and a fine of up to $250,000.

Anyone accused of committing financial crimes and fraud by the federal government should immediately consult an experienced attorney who can perform an independent investigation and determine the best way to minimize the penalties or have the charges completely dropped.

South Florida Fraud Defense Attorney

Are you accused of committing financial crimes or fraud in South Florida? Contact Brian Silber, P.A. for a free initial consultation with one of South Florida’s most experienced financial crimes attorneys.

Source: 8.7.20 Lexington doctor and office manager indicted in international money laundering scheme involving non-approved drugs.pdf

Three South Florida Residents Charged for Allegedly Participating in $24 Million Covid-Relief Fraud Scheme

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pexels-photo-3952234-300x200Federal prosecutors in South Florida have filed charges against three local residents for their alleged participation in a scheme to file fraudulent loan applications seeking more than $24 million in forgivable Paycheck Protection Program (PPP) loans that are guaranteed by the Small Business Administration (SBA).

Damion O. McKenzie, 38, of Miami Gardens, Andre M. Clark, 46, of Miramar, and Keyaira Bostic, 31, of Pembroke Pines, were each charged in separate criminal complaints with wire fraud, bank fraud, and conspiracy to commit wire fraud and bank fraud. Attorney information was not available.

According to the criminal complaint, the trio, with the assistance of other co-conspirators, submitted fraudulent PPP loan applications for their respective companies. The PPP is a federal program designed to provide small American businesses affected by the coronavirus pandemic with funds for business-related expenses. Qualifying businesses can receive a two-year loan with a one percent interest rate. Congress has authorized over $650 billion in forgivable loans as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

“The United States made funds available to small business owners through the Paycheck Protection Program to ensure that our communities’ local businesses and their employees financially survive this pandemic,” said U.S. Attorney Ariana Fajardo Orshan. “Those who defraud the program with no regard  for the effect that their actions of greed will have on small business owners and employees who legitimately need the money will be vigorously prosecuted by my office.”

The fraudulent loan applications McKenzie, Clark, and Bostic filed were allegedly supported by doctored documents, including fake payroll tax forms and bank statements. After submitting the applications for their own companies, they allegedly became recruiters and referred other businesses to their co-conspirators for the purpose of submitting more fraudulent loan applications. The trio allegedly received kickbacks for any loans approved and funded for any client they referred to their co-conspirators.

Overall, the alleged scheme involved the submission of at least 90 loan applications, worth more than $24 million dollars. Many of the loan applications were approved and funded, paying out at least $17.4 million, according to sources.

“The defendants allegedly participated in an extensive nationwide scheme to file at least 90 fraudulent applications for millions of dollars in PPP loans in exchange for illegal kickbacks of portions of the loan proceeds,” said Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division. “These allegations reflect an organized effort by defendants to defraud the SBA’s PPP program on a large scale by stealing funds intended for legitimate small businesses suffering from economic hardships caused by the COVID-19 pandemic.”

Any business owner suspected of committing fraud involving the federal government’s coronavirus-relief program should immediately consult an experienced attorney who can review the evidence and decide the best course of action.

South Florida Fraud Defense Attorney

Are you accused of committing COVID-19 fraud in South Florida? Contact Brian Silber, P.A. to set up a free initial consultation with one of South Florida’s most experienced fraud defense attorneys.

Source: 8.6.20 Three south florida residents who participated in $24 million Covid-relief fraud scheme charged in federal court.pdf