GCIS INTELLIGENCE BRIEFING: Insurance Broker and Housing Authority Director Charged in New Jersey with Election Fraud

 

ISSUED BY: GCIS Communications Command Center

SOURCE: FBI

19May2011 6:31pmEST

GCIS INTELLIGENCE UPDATE:  NEWARK, NJ—A Newark federal grand jury has indicted Francis X. Gartland, an insurance broker, and Thomas J. O'Leary, the executive director of the South Amboy Housing Authority, for alleged federal election fraud, U.S. Attorney Paul J. Fishman announced. The six-count indictment, returned by the grand jury on May 17, 2011, and unsealed today, variously charges Gartland, 70, of Baltimore, Md., and O'Leary, 49, of South Amboy, N.J., with conspiracy to defraud the United States, violations of federal elections laws, and causing false statements to be submitted to the Federal Election Commission in connection with the 2006 Democratic primary campaign of Joseph Vas for United States Congress in New Jersey's 13th District.

O'Leary surrendered this morning to special agents of the FBI and is scheduled to appear this afternoon before U.S. Magistrate Judge Mark Falk in Newark federal court. Gartland, who was separately charged in December 2010 for, among other things, allegedly participating in a bribery and kickback scheme and evading federal income taxes, is currently out on a $1 million bond in connection with those charges. An arraignment for both defendants will be scheduled before the U.S. District Judge assigned to the case.

According to the indictment unsealed today:

Gartland and O'Leary allegedly participated in a scheme to use "straw" or "conduit" contributors to funnel contributions to the Vas congressional campaign. Vas, the former mayor of Perth Amboy and New Jersey state assemblyman, and Melvin Ramos, Vas' former mayoral aide and the treasurer of Vas' campaign, were convicted on October 8, 2010, following a jury trial, of charges of mail fraud, fraud and misapplication of funds, false statements, and federal election crimes. Vas and Ramos were sentenced to 78 and 37 months in prison, respectively, by U.S. District Judge Susan D. Wigenton on April 12, 2011. In addition to the prison terms, Judge Wigenton sentenced Vas and Ramos to three years of supervised release and ordered them to pay $90,000 in restitution to Perth Amboy. Vas was also ordered to pay a $73,200 fine.

The indictment charging Gartland and O'Leary alleges that during the 2005-2006 election cycle, the defendants recruited 15 straw contributors to contribute between $2,000 and $2,100 each to Vas' federal campaign committee. Gartland and O'Leary allegedly funded the straw contributions by reimbursing each of the contributors by cash or check. Straw contributions are prohibited by the Federal Election Campaign Act.

The charges in the Indictment and maximum potential penalties per count are as follows:

Count(s)	Charged Defendant(s)	Maximum Potential Penalty
1– conspiracy to defraud the United States	O'Leary, Gartland	Five years in prison; $250,000 fine, or twice the aggregate gain or loss
2 – making contributions to a federal candidate in the names of others (more than $10,000 in a calendar year)	Gartland	Two years in prison; fine of not less than 300 percent and not more than the greater of $50,000 or 1,000 percent of the amount involved in the violation
3 – making contributions to a federal candidate in the names of others	O'Leary	One year in prison; $100,000 fine
4,5 – causing false statements to the Federal Election Commission	Gartland	Five years in prison; $250,000 fine, or twice the aggregate gain or loss
6 – causing false statements to the Federal Election Commission	O'Leary	Five years in prison; $250,000 fine, or twice the aggregate gain or loss

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Michael B. Ward, with the investigation leading to the Indictment.

(read full report)

"GCIS INTELLIGENCE UPDATE" is an intelligence briefing presented by Griffith Colson Intelligence Service, and provided to the public for informative purposes only. All subject matter is credited to it's source of origin, and is not intended to represent original content authored by GCIS, it's partners or affiliates. All opinions presented are those of the author, and not necessarily those of GCIS or it's partners.

GCIS INTELLIGENCE BRIEFING: Former Bank President and Senior Loan Officer Indicted in Multi-Million-Dollar Fraud Conspiracy

Failed Stockbridge Bank Allegedly Fleeced Before Being Seized By Feds

ISSUED BY: GCIS Communications Command Center

SOURCE: FBI

21March2011 8:19pmEST

GCIS INTELLIGENCE UPDATE: ATLANTA—An indictment unsealed today charges two former top officers of FirstCity Bank of Stockbridge, Georgia—MARK A. CONNER, 44, formerly of Canton, Georgia, and CLAYTON A. COE, 44, of McDonough, Georgia—with a variety of offenses, including conspiracy to commit bank fraud and bank fraud in connection with misconduct at FirstCity Bank in the years before the bank’s seizure by state and federal authorities on March 20, 2009. In addition to the conspiracy and bank fraud charges, the indictment charges CONNER with conducting a continuing financial crimes enterprise at the bank between February 2006 and February 2008, during which CONNER’s and his co-conspirators’ crimes allegedly generated over $5 million in unlawful gross proceeds.

A federal grand jury in Atlanta returned the sealed indictment against CONNER and COE on March 16, 2011. CONNER was arrested on the charges and taken into custody by federal agents at Miami International Airport yesterday morning, the two-year anniversary of FirstCity Bank’s failure, upon his arrival in Miami from the Turks and Caicos Islands in the West Indies. CONNER made his initial appearance today before a federal magistrate judge in Miami, who preliminarily ordered CONNER to be detained as a flight risk pending his transfer by Deputy U.S. Marshals from Miami to Atlanta for trial. A formal detention hearing will take place in Miami on Thursday, March 24, 2011, at 1:30 p.m. COE’s initial appearance on the indictment in the Northern District of Georgia has not yet been scheduled.

United States Attorney Sally Quillian Yates said, “The entire country has felt the deep economic impact of failed banks. At the heart of this indictment is an abuse of power by key insiders, who are charged with tricking their own colleagues into approving millions of dollars in commercial loans to fund the defendants’ own personal business activities, and to enrich themselves at the bank’s expense. Along the way, these defendants also allegedly defrauded state and federal bank regulators and examiners, and at least 10 other federally insured banks in Florida and Georgia that invested in the fraudulent multi-million-dollar loans.”

FDIC Inspector General Jon Rymer said, “The Federal Deposit Insurance Corporation (FDIC) Office of Inspector General (OIG) is pleased to join the United States Attorney’s Office for the Northern District of Georgia and our law enforcement colleagues in announcing this indictment. We are particularly concerned when former senior bank officials, who have held positions of trust within their institutions, are alleged to have been involved in criminal activity. We will continue to aggressively pursue bank officials and others who victimize financial institutions.”

Neil Barofsky, SIGTARP Special Inspector General for the Troubled Asset Relief Program said, “Today’s indictment marks yet another occasion where bank executives are alleged to have turned to criminal fraud in the midst of the financial crisis, including an attempt to obtain millions of dollars from the American taxpayer through the Troubled Asset Relief Program. SIGTARP will continue to work with our law enforcement partners to bring those who engage in such crimes to justice.”

IRS-Criminal Investigation Special Agent in Charge Reginael McDaniel said of the case, “Honest and law abiding citizens are fed up with the likes of those who use deceit and fraud to line their pockets with other people’s money. Those individuals who engage in this type of financial fraud should know they will not go undetected and will be held accountable.”

According to United States Attorney Yates, the charges, and other information presented in court: CONNER served in a variety of top positions at FirstCity Bank between 2004 and 2009, including as vice-chairman of the board of directors, as a member of the banks’ loan committee, as president, and later as acting chairman and chief executive officer. COE served as a vice-president and as FirstCity Bank’s senior commercial loan officer. While serving in these positions, CONNER, COE, and their co-conspirators allegedly conspired to defraud FirstCity Bank’s loan committee and board of directors into approving multiple multi-million-dollar commercial loans to borrowers who, unbeknownst to FirstCity Bank, were actually purchasing property owned by CONNER or COE personally.

The indictment charges that CONNER, COE, and their co-conspirators misrepresented the essential nature, terms, and underlying purpose of the loans and falsified documents and information presented to the loan committee and the Board of Directors. CONNER, COE, and their co-conspirators then allegedly caused at least 10 other federally insured banks to invest in, or “participate in” the fraudulent loans based on these and other fraudulent misrepresentations, shifting all or part of the risk of default to the other banks. COE’s bonus compensation was tied to the origination of FirstCity Bank loans, including the fraudulent loans with which he and CONNER allegedly assisted each other.

In the process of defrauding FirstCity Bank and the “participating” banks, CONNER, COE, and their co-conspirators allegedly routinely misled federal and state bank regulators and examiners to conceal their unlawful scheme. They also unsuccessfully sought federal government assistance through the U.S. Treasury Department’s Troubled Asset Relief Program (“TARP”) and engaged in other misconduct in an attempt to avoid seizure by regulators and prevent the discovery of their fraud.

The charge against CONNER for conducting a continuing financial crimes enterprise carries a mandatory minimum sentence of 10 years in federal prison, a maximum sentence of life in prison, and a potential fine of up to $10 million. The conspiracy and bank fraud charges against CONNER and COE, and a remaining charge against COE for fraudulently influencing the actions of a federally insured bank, carry a maximum sentence of 30 years in prison and a potential fine of up to $1 million on each count. In determining the actual sentences for each defendant, the court will consider the United States Sentencing Guidelines, which are not binding but provide appropriate sentencing ranges for most offenders.

Members of the public are reminded that the indictment only contains charges. The defendant is presumed innocent of the charges and it will be the government’s burden to prove the defendant’s guilt beyond a reasonable doubt at trial. (read full report)

"GCIS INTELLIGENCE UPDATE" is an intelligence briefing presented by Griffith Colson Intelligence Service, and provided to the public for informative purposes only. All subject matter is credited to it's source of origin, and is not intended to represent original content authored by GCIS, it's partners or affiliates. All opinions presented are those of the author, and not necessarily those of GCIS or it's partners.

GCIS INTELLIGENCE BRIEFING: India seeks U.S. help for students victimized by educational fraud

ISSUED BY: GCIS Communications Command Center

SOURCE: IntelliBriefs

26February2011 3:00pmEST

GCIS INTELLIGENCE UPDATE: NEW DELHI: India on Wednesday said it expected the US to prevent its universities from exploiting foreign students, as has happened in the case of Tri-Valley University in California in which about 1,500 Indians face an uncertain academic future.

External affairs minister SM Krishna, in a suo motu statement in the Lok Sabha, said the government was confident that the "unfortunate development" in the Tri-Valley University would not affect the "excellent cooperation" between India and the US in higher education, under which over a lakh Indian students are studying in American universities.

"The government expects the United States would take steps to prevent such (Tri-Valley) universities from exploiting foreign students. The government would also advise Indian students to exercise due diligence in applying to foreign universities," he said soon after the Question Hour ended.

"I am confident that this unfortunate development will not affect the excellent cooperation between India and the United States in higher education, which includes the presence of over 100,000 Indian students at US universities, and who enjoy a strong reputation for academic accomplishments and responsible conduct," he added.

Krishna said while India recognised the right of every government to investigate and prosecute fraud, it has asked the US government that all Tri-Valley students, who are themselves victims of fraud, should be given adequate time and opportunity to transfer to other universities or adjust their status. And, if they desired so, they should be allowed to return to India honourably. (read full report)

"GCIS INTELLIGENCE UPDATE" is an intelligence briefing presented by Griffith Colson Intelligence Service, and provided to the public for informative purposes only. All subject matter is credited to it's source of origin, and is not intended to represent original content authored by GCIS, it's partners or affiliates. All opinions presented are those of the author, and not necessarily those of GCIS or it's partners.

GCIS INTELLIGENCE BRIEFING: Indictment: Ring traded in phony IDs for illegals

ISSUED BY: GCIS Communications Command Center

SOURCE: The Washington Times

25February2011 6:00pmEST

GCIS INTELLIGENCE UPDATE: A federal grand jury in Richmond has indicted 22 members of a suspected fraudulent-document-trafficking ring based in Mexico with cells in 19 U.S. cities and 11 states that reportedly sold high-quality phony identification cards to illegal immigrants and used beatings, kidnappings and murder in dealing with competitors and disciplining its own members.

U.S. Immigration and Customs Enforcement Director John Morton said the sophisticated operation, uncovered as part of a law enforcement initiative known as Operation Phalanx, was managed in this country by Israel Cruz Millan, 28, of Raleigh, N.C., who oversaw the production of false identification cards that sold on the street for $150 to $200 each — which netted his Mexican bosses more than $1 million from January 2008 to November 2010.

According to the 12-count indictment, Mr. Cruz Millan placed a manager in each U.S. city, all of whom supervised a number of “runners” who distributed business cards advertising the organization’s services and helped facilitate transactions with customers. The cost of the phony documents varied depending on location and included counterfeit Resident Alien and Social Security cards.

The indictment said each cell maintained detailed sales records and divided the proceeds among the runner, the cell manager and the upper-level managers in Mexico. (read full report)

"GCIS INTELLIGENCE UPDATE" is an intelligence briefing presented by Griffith Colson Intelligence Service, and provided to the public for informative purposes only. All subject matter is credited to it's source of origin, and is not intended to represent original content authored by GCIS, it's partners or affiliates. All opinions presented are those of the author, and not necessarily those of GCIS or it's partners.

GCIS INTELLIGENCE BRIEFING: Debt collector who targeted troops shut down

ISSUED BY: GCIS Communications Command Center

SOURCE: Air Force Times

19February2011 11:30amEST

GCIS INTELLIGENCE UPDATE: (AP) – BUFFALO, N.Y. — A New York debt collector accused of targeting military families is out of business.

Attorney General Eric Schneiderman said Friday that Stephanie Lowinger of Buffalo has pleaded guilty to a misdemeanor count of scheming to defraud and has been permanently banned from future debt collection activities.

Investigators say Lowinger and collectors she employed falsely told members of military families that those on active duty faced arrest by military police and a dishonorable discharge if they didn’t pay alleged debts.

Also Friday, Schneiderman’s office announced monetary settlements with three other western New York debt collectors accused of violating regulations against bullying and threatening consumers.

The actions continue a crackdown by the state on abusive and illegal debt collection methods. (read full report)

"GCIS INTELLIGENCE UPDATE" is an intelligence briefing presented by Griffith Colson Intelligence Service, and provided to the public for informative purposes only. All subject matter is credited to it's source of origin, and is not intended to represent original content authored by GCIS, it's partners or affiliates. All opinions presented are those of the author, and not necessarily those of GCIS or it's partners.