| #528 - December 28, 2007 |
 | |  | |  | |  | |  |
| #528 Updated: 12/28/07 3:06 p.m. Con man ordered held, pending fed fraud trial desertnews.com | 12/28/07 | Geoffrey Fattah After hearing the convoluted details of a convicted con man's past, a federal magistrate judge has ruled he will remain in federal custody pending trial on new fraud charges, after prosecutors said there was evidence he faked his employment at a construction company to his parole officer while working on a new scam. During a hearing Wednesday, a federal prosecutor said there was also evidence that Wayne Reed Ogden was using money from recent investors to pay some $7 million in restitution to his old investment victims. Ogden was convicted in 1998 of bilking 500 investors, mostly friends and neighbors, of an estimated $7 million in a Ponzi scheme. He was sentenced to up to 15 years in prison. But after his first parole in November 2000, U.S. District Magistrate Judge Brooke Wells noted Ogden had a "complicated" history of being paroled and hauled back in twice for parole violations. In between, Ogden was accused of misconduct. The prosecution called an FBI agent and Ogden's former state parole officer as witnesses. Parole officer Paul Truelson said that after Ogden was paroled in 2000, he was instructed to get a job that did not involve handling other people's money. Truelson said Ogden provided the Utah Department of Adult Probation and Parole documentation that he had been hired by a construction company and that he would work as a construction foreman on a project in Colorado. Ogden was even given several travel permits to travel out of state to Colorado for his supposed job. It wasn't until later that parole officers discovered Ogden's employment papers were bogus. FBI special agent Jeffrey Cannon said his office discovered Ogden and his brother were involved in a credit counseling company, where Ogden again began soliciting investors to purchase property in Colorado. After getting several million dollars, investors soon began expecting the 50- to 100-percent returns that Ogden had promised them. Frustrated investors filed suits against Ogden, suing him for $9 million. Ogden's defense attorney, Mary Corporon, said her client claims there was even a kidnapping incident by disgruntled investors. Assistant U.S. Attorney Loren Washburn said while Ogden was working up another Ponzi scheme, he was taking money from recent investors and using it to pay off the $7 million in restitution he was ordered to pay the victims of his old scam. "He's stealing from new victims in order to pay restitution," Washburn said in court. Corporon responded that before his previous conviction, Ogden had no prior criminal record and that he has always had a history of showing up to court for hearings. After hearing arguments from both sides, Wells said she did not find Ogden to be a flight risk but did find that he is a danger to the community. Although Ogden is not accused of violence or drugs, Wells did note that he has proven he is not willing to follow court orders while on parole and could prove a danger to people in the community and their money. back home... Woman who pleads guilty to welfare fraud has almost $200,000 in bank post-trib.com | 12/28/07 | James D. Wolf Jr. VALPARAISO -- A former Valparaiso resident pleaded guilty to two of five charges against her for welfare and Medicaid fraud in a trial that was recessed twice when the defendant claimed trouble understanding English. Len Huyhn, 37, formerly of the 400 block of Sturdy Road, on Thursday admitted to welfare fraud as a Class D felony and an amended count of Medicaid fraud, lowered to Class D felony from Class C. According to her plea agreement, she could be sentenced to two years for each charge, running consecutively and after any time she receives in Marion County on an unrelated charge. The two years for welfare fraud would be waived except for time served and count as formal probation. Her sentencing is Feb. 12 at 9 a.m., the day before her Marion sentencing. Under the original charges faced a sentence of up to 30 years. The Marion charges are related to her ordering textbooks and educational supply samples under the names of different professors around Indiana, then using UPS tracking to reroute them to her house. One educational company said the resale value was high for the items. Judge Mary Harper took the two recesses during the trial to make sure Huyhn's attorney explained everything in the plea agreements. Huyhn said she's been in the United States more than 10 years and has 100 college credit hours, including some at Valparaiso University. The fraud charges in Porter County came about during an investigation which revealed she had almost $200,000 in three bank accounts, making her ineligible for government assistance. She was arrested Feb. 15 in Valparaiso on a warrant for theft though Vanderburgh County. She also was involved in extensive food stamp and Medicaid fraud in 2005 and 2006, collecting $3,035 and $3,866, respectively, in Vanderburgh and Porter counties. back home... Two more arrests made in suspected auto scam dailypilot.com | 12/27/07 | Kelly Strodl Costa Mesa police have arrested two more men in connection with a suspected auto consignment scam that affected at least 30 victims who collectively lost a total of more than $1.1 million, police said. At about 1 p.m. Thursday, Ricardo Fuentes, 41, of Fullerton and Manh “Guy” Dac Hua, 35, of Westminster surrendered to police. Both were wanted on $250,000 warrants, authorities said. Fuentes and Hua, the lot’s corporate officers and the two thought by investigators to be the masterminds behind the alleged scheme, have not returned to the business for months, police said. Detectives arrested Jalal Din Jalali on suspicion of five counts of grand theft when the man surrendered to authorities Wednesday morning. Jalali, 60, faces additional charges of conspiracy of grand theft auto, with enhancements for illegally taking in excess of $50,000, fraud or embezzlement exceeding $500,000, and commission of two or more related felonies involving fraud or embezzlement, according to Orange County Superior Court records. David Gordon Emmott, 67, also surrendered to police Wednesday. He has been charged with nine counts of grand theft auto with enhancements for taking in excess of $50,000, fraud or embezzlement exceeding $500,000, and commission of two or more related felonies involving fraud or embezzlement, according to court records. Earlier reports from prosecutors had them also charged with enhancements for use of a dangerous weapon, but that information was a mistake, police said. About 30 victims filed complaints with Costa Mesa over the last six months. Many said they had to keep making payments on cars they no longer had, Sgt. Frank Rudisill said. Some victims received letters in the mail from the bank notifying them they still owed money on a car loan that the new owner was supposed to assume, Rudisill said. Some were told their car was still on the lot when they called for a status report even though it had been sold weeks before, Rudisill said. Other victims got checks that later bounced, according to police. One victim said his checks had bounced for a year, police said. Orange County prosecutors filed charges Thursday against Jalali, Emmott, Fuentes, Hua, and Patrick Norman McConnell, 63, according to court records. Police are still looking for McConnell, authorities said. back home... Sentencing for woman who stole $250,000 set carrollcountytimes.com | 12/28/07 | Erica Kritt Karen Ann Malinowski is awaiting sentencing after pleading guilty in July to stealing nearly $250,000 from a Carroll Lutheran Village resident she was caring for. Malinowski, a Westminster resident, was the third person in the county to be charged with embezzlement in the last two years. A hearing to determine the amount of money she must pay back is scheduled for Jan. 14 and 15. Her sentencing is expected to be set on Feb. 19, according to Deputy State’s Attorney Melissa Hockensmith. Malinowski had been stealing from Lois Hundertmark for more than four years, even after Hundertmark died in 2006. The woman’s son, James Hundertmark, noticed a lack of funds and alerted authorities. The Economic Crime Unit with the state’s attorney’s office found 34 checks made out to Lois Hundertmark that were endorsed and made payable to Malinowski. The checks added up to $130,077. Malinowski was charged with six counts of felony theft scheme, five counts of theft of more than $500, two counts of theft of less than $500, and one count of embezzlement Feb. 6. The two others charged with embezzlement stole from two separate schools in the county. Linda Sprinkle, the financial secretary at Shiloh Middle School, was sentenced to six months at the Carroll County Detention Center in February for stealing $13,000 from the school. Sprinkle was ordered to pay back $13,274 in restitution to the school system. She was incarcerated in the center from March 24 to 26 and served the rest of her sentence at home, until Aug. 3. Sprinkle retired after allegations of the theft were raised in 2004. By 2005, Sprinkle was arrested. The money Sprinkle stole came from funds raised by students for yearbooks sales, field trips, ski club trips and money from a fund for the families of firefighters who died in the terrorist attacks of Sept. 11, 2001. Wendy Sue Bowers, a financial secretary at South Carroll High School, was sentenced to 15 months in January for stealing more than $220,000 from the school. Bowers began to steal funds in 1999 by doctoring receipts. She also stole from student-raised funds for yearbook sales, field trips and fundraisers. The school employee was arrested in 2006 after an investigation by the state’s attorney’s office. On Jan. 2, she was sentenced to repay all the $228,000 she stole and serve 15 months in jail. Bowers, served her term on work release from Jan. 2 until Oct. 14 of this year. According Hockensmith, Bowers was released early for good behavior. Bowers used the funds she stole to go shopping and pay for a trip to Disney World, according to Hockensmith. Bowers’ attorney Thomas C. Morrow, claimed she spent the money because she had a disorder that made her want to give her children a better life than her own. Bowers is set to pay back $1,736 per month. Hockensmith said that embezzlement is a big problem in the community and it’s hard to spot an embezzler. In a work situation, often it’s a warning sign when a person does not take any vacation, Hockensmith said, because they don’t want anyone to see what they’ve been doing. back home... Inside Bribery Probe of Siemens online.wsj.com | 12/28/07 | David Crawford and Mike Esterl In the spring of 2003, auditors for a bank owned by Liechtenstein's royal family spotted an unusual flurry of money transfers involving a small offshore firm called Martha Overseas Corp. They discovered that Martha Overseas was controlled by Prodromos Mavridis, a top executive in Greece with Siemens AG, the German engineering giant. Millions of euros were pouring into the account from another offshore firm controlled by a different Siemens executive based at the company's Munich headquarters. The bank auditors in the tiny Alpine nation, on the lookout for possible terrorist-financing transactions, had instead stumbled upon one of the largest corporate bribery cases in recent history. Today, prosecutors in the U.S. and around the world are pursuing allegations that Siemens bribed customers to win big infrastructure contracts. Increased post-9/11 scrutiny is making it tougher for companies to camouflage payments through countries such as Switzerland and Liechtenstein, which have rolled back banking-secrecy laws. Authorities in the two nations played a quiet but central role in uncovering wrongdoing at Siemens. In October, German prosecutors fined Siemens €201 million ($291.3 million) after tracing €12 million in bribes to Nigeria, Russia and Libya. Siemens said last month it has identified €1.3 billion in suspicious transactions world-wide between 2000 and 2006. The scandal became public when German police raided Siemens offices in November 2006. But confidential bank and court documents reviewed by The Wall Street Journal and interviews with law-enforcement officials show how the raid followed more than three years of work in untangling Siemens's money transfers. The timeline, along with earlier evidence, suggests top Siemens executives knew about allegations of wrongdoing at least two years before they acknowledged illicit transactions. In the spring of 2003, according to people familiar with the matter, compliance officials at LGT zeroed in on a flurry of transactions between Martha Overseas, a Panama-based company controlled by Mr. Mavridis, and Eagle Invest & Finance SA, a company based in the British Virgin Islands and controlled by a Siemens executive in Germany, Reinhard Siekaczek. They noticed that €1 million was paid into a Liechtenstein account before being withdrawn the same day and that half a dozen transactions involving €5 million ricocheted through related accounts over a three-week period. Auditors at LGT grew suspicious because the payments were characterized as commissions paid by Siemens to the two executives, according to people familiar with the case. The auditors wondered why Siemens would pay commissions to senior salaried employees and why the funds would be directed through offshore accounts with no ostensible ties to Siemens. In November 2004, shortly after LGT filed a suspicious- transactions report to local authorities, Liechtenstein blocked €7.6 million in funds that appeared to originate with Siemens. The authorities alerted their Swiss and German counterparts, as well as Siemens. The chief complianc e officer at Siemens reported the Liechtenstein case to the company's audit committee in January 2005, according to a court document and a Siemens board member. By that point, senior managers already knew of suspected illicit activity, according to testimony from former Siemens officials. (Excerpt) back home... Jasper Man Admits Bribe al.com | 12/27/07 | Brett Blackledge A Jasper businessman is the latest to plead guilty in an ongoing criminal investigation of Alabama's two year college system, admitting in a federal court filing Wednesday that he gave more than $270,000 to former Chancellor Roy Johnson, his family and a Johnson friend in exchange for college contracts. Winston Hayes, 64, has agreed to plead guilty to bribery and conspiracy to commit money laundering. The founder of Access Group software company also has agreed to pay $5 million as part of his plea, according to the agreement filed in Birmingham federal court. U.S. Attorney Alice Martin said Hayes' payment strips him of the profits he earned from the kickback scheme that helped his company secure more than $14 million in college contracts since 2002. "Paying bribes to achieve an unfair and illegal business advantage is a path to prosecution," Martin said in a statement released Wednesday. Efforts to reach Johnson for comment Wednesday failed. Hayes faces a maximum of 20 years on the money laundering count and 10 years for bribery. Prosecutors state in his agreement that they will recommended lesser sentences if he cooperates fully. Hayes admitted paying Johnson $124,400 to help build a house in Opelika. Hayes said he disguised the payments by paying Johnson's driver for consulting work he never did. Johnson's former driver, Robert Higgins, agreed to plead guilty last month to obstruction of justice and also is cooperating with prosecutors. Higgins said in his agreement that he received cash from Hayes and an Auburn contractor who also has admitted paying kickbacks to Johnson and his family. Higgins said he gave the cash to Johnson or paid bills for the new house for Johnson. Johnson has been a target in the federal criminal investigation that started at the Alabama Fire College in Tuscaloosa in 2004. Prosecutors have filed a lien against his $1.3 million house, saying he used kickbacks from college vendors to build it in 2004. Johnson has denied the claims. Hayes said in his plea agreement that he also gave Johnson a $23,850 sound system for the new house. Hayes said he and Johnson hid the transaction by arranging for Hayes to pay another company, which bought the sound system for Johnson. The agreement does not name the company. Hayes said he also paid Roy Johnson cash when Johnson was president of Southern Union State Community College, although all of the details of those kickbacks were not included in the plea agreement. Hayes said he submitted bogus invoices to Southern Union and gave some of the college's payments to Johnson and Johnson's family, including $19,600 to Johnson's son for work he never did. back home... Millions linked to Raul Salinas to stay frozen iht.com | 12/27/07 | Associated Press BELLINZONA, Switzerland: More than US$130 million (€90.3 million) in Swiss bank accounts linked to the brother of former Mexican President Carlos Salinas will stay frozen, Switzerland's highest criminal tribunal said in a ruling published Thursday. The Federal Criminal Court rejected an appeal by Raul Salinas' wife against an earlier decision by Switzerland's investigating authorities, to keep the money blocked. Millions in assets connected to Salinas have been frozen in Switzerland since November 1995, when investigators first suspected that the money came from drug traffickers. The amount has grown to US$130.79 million (€90.84 million) with interests. In November 2002, the Swiss ended their investigation and handed over 300 volumes of materials to the Mexican authorities, who believed the funds were not drug money but were diverted to Salinas out of a "secret fund" traditionally available to Mexican presidents, who did not need to account for it. The ruling published Thursday enables Mexican authorities to confiscate the assets if they present a legal order for confiscation to their Swiss counterparts. Salinas' wife, Paulina Castanon, in her appeal had argued that keeping the money frozen for 12 years was excessively long and infringed the principle of proportionality, according to the ruling. But the Federal Criminal Court rejected the appeal referring to the complexity of the case and said the length of the proceedings was not the fault of the federal investigator's office. It also ordered the Swiss authorities to closely follow the proceedings in Mexico where Raul Salinas still faces charges of illegal enrichment. Salinas has said that millions of dollars found in bank accounts he controlled overseas were legitimate — not the product of money laundering or political payoffs as prosecutors have suggested. back home... ________________________ |