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Category Archives: 43 Fraudulent Schemes Reduced

Ms. K was in the Air Force from 1981 through 2001 and received an Honorable Discharge. She was initially rated at 90% service-connected disability for various medical conditions from 2001 to 2003. Then from 2006 until 2014, she was rated at 100% medically disabled. She had vowed that she was unemployable.

Just prior to 2007, she applied to the Veteran’s Administration for increased compensation based on her unemployability. She stated that she formerly was employed by a large airline as an Operational Manager but had recently become 100% unemployed. The VA approved her for $2,560 a month from that point forward. From approximately January 1, 2007 to February 1, 2014, she received a total of $90,579 in Disability Benefits.

What she failed to do was update the VA that she had gained employment from late December of 2006 through February 7, 2014 and was working fulltime. Because of this Benefits Fraud, she was subsequently charged with 1 Count of Fraudulent Schemes, 1 Count of Theft, and 3 Counts of Forgery.  If we would have proceeded to Trial and lost on all 5 Counts, she could have received up to 68 years in prison.

We were able to use significant mitigation to Ms. K’s benefit. We were able to show the Prosecutor that she had no prior felony convictions, that she was a single-parent mother and was an active member in the Baptist Church, and she had a fairly- outstanding military career that left her somewhat disabled mentally (which may have played a part in her crime). She cooperated fully in the investigation and truly had remorse. Ultimately, we negotiated a deal that could have allowed the Judge to have sentenced Ms. K up to 9 months in jail. In the end, the Judge sentenced her to Probation with 6 months of jail and the ability to be released daily for work under the Work Furlough Program.

Ms. N. was employed as an Office Manager for a corporation from 2005 to 2014. She was caught fraudulently distributing 401(k) profit share distribution, which belonged to other employees, into her personal 401(k) account. That amount totaled $6,600. While she was being terminated, she admitted to the Theft. After a complete and thorough accounting was done by the corporation, it was determined that other amounts were also missing. In addition to the 401(k) money, she submitted fraudulent expense reimbursements between 2010 and 2014, which totaled $146,600. Lastly, as for two terminated employee 401(k) amounts, which were misappropriated, these totaled $12,100. Although all losses totaled $158,820, the corporation had to reimburse $165,400 into accounts due to their costs and gains.

We were able to work with the Prosecutor to show extensive mitigation that Ms. N had regarding her life. She was the youngest of two children and experienced a traumatic upbringing. She grew up in significant poverty, and her father was a former Vietnam Marine with PTSD, who was severely alcoholic and was physically and verbally abusive to both her and her mother. She began working at 16 in order to provide for herself and the family. She also was periodically homeless. Eventually, she gave birth to her first daughter when she was 19-years old, and then had three children before she was hired by the corporation.

Her first day on the job, she was a single mother to three and was only being paid $35,000 per year. Shortly after being hired, her mother died, and Ms. N was now responsible to pay all of the funeral costs and other expenses left behind by her mother. Although, none of this is an excuse to steal, it was mitigation. A few months later her father passed away from stage 4 lung cancer approximately one week after this investigation had begun. In addition, her only prior criminal conviction was for a misdemeanor DUI.

Ultimately, the Prosecutor agreed to a plea which included probation with 1 year of prison. Originally, she was facing much higher/longer prison time due to the fact that there were multiple offenses committed on different dates, and the total amount of loss was above $100,000.

Mr. R worked for the Swift Transportation Co. as an Information Technology (IT) Network Engineer. He subsequently formed an additional company known as PGN Solutions and began issuing false invoices to Swift Technology. He also secured credit cards from Swift Technology which allowed him to make other purchases. These purchases were disguised because he had claimed an Affiliation with Aspen Technologies (a legitimate contractor with whom Swift conducted a considerable amount of business). Unfortunately, PGN Solutions was merely a shell-company and was never affiliated with Aspen Technologies.

Ultimately, all of these purchases (combined with a tax liability) came to a total of $2,192,000. We were able to show the Prosecution that there had been no Obstruction of Justice by Mr. R., there had been an acceptance of responsibility and there was true remorse. Mr. R. had a family with young children and had also assisted the Sheriff’s Department with remote mountain rescues in the past. Ultimately, we were able to secure a deal that included restitution and 57 months in prison. If we would have gone to Trial and lost, Mr. R. would have faced potentially the rest of life in prison.

Felony Benefits Fraud ($50,800 Misappropriated from SSI), Felony Fraudulent Schemes and Felony False Swearing Reduced to Probation with Zero Days of Actual Jail – State v. Ms. M (DMC No. 12750) (Maricopa County Superior Court CR2014-002739): Ms. M was born without part of her arm.  She was on SSI Benefits and had to fill out regular forms with the Social Security Administration.  She became married to a gentleman who made good money, and who owned several houses.  In addition, she received a $250,000 civil settlement (which left her with $100,000 after attorney’s fees and cost).  She did not report any of these to the Social Security Administration and, in fact, signed forms stating she was not married and had no other income.

When she was interviewed by the Social Security Agency, she denied being married.  When they showed her a copy of her marriage certificate, she broke down and confessed to the entire scheme.  She was then charged with Fraudulent Schemes Involving Benefits Fraud, Theft and False Swearing.  If all charges were run consecutively and she was sentenced to the maximum, she would do almost 30 years in prison.

We became involved and we were able to show some of the hardships that Ms. M had faced.  We also showed through Mitigation that she was truly remorseful and was now seeking counseling to deal with the loss of her arm and medical situation. Ultimately, we were able to get the charges reduced and the Judge sentenced Ms. M to probation with Zero Days of Actual Jail.

(40 COUNTS) FELONY COMPUTER TAMPERING, TAMPERING with PHYSICAL EVIDENCE, ACQUISITION of a NARCOTIC DRUG, THEFT and FRAUD SCHEMES REDUCED to 3.75 YEARS in PRISON – State v. Mr. M (DMC No. 12321) (Maricopa County Superior Court CR2012-007417): Our office was retained after Mr.  M, a former Phoenix Police Detective, was arrested and extradited to Arizona. Initially, we were retained for just the Initial Appearance which involved a 40 count indictment for Computer Tampering per Arizona Revised Statute ARS 13-2316, Tampering with Physical Evidence per Arizona Revised Statute ARS 13-2809, Acquisition of Narcotic Drugs per Arizona Revised Statute ARS 13-3408, Theft per Arizona Revised Statute ARS 13-1802, and Fraudulent Schemes per Arizona Revised Statute ARS 13-2310. Subsequent to this, the client retained us for the entire case.

At the not guilty Arraignment, a brief discussion was had with  the  assigned  prosecutor, who  advised  that  there  was  over  5000  pages  of discovery. He advised he would be filing a motion to designate the case “complex.” After this hearing, which was attended by my partner, Certified Criminal Law Specialist Christine Whalin, she and I met to discuss the motion to modify release conditions that had been filed and the anticipated voluminous discovery that was forthcoming.

In Court, co-counsel and I appeared to address the bond on the matter. We ascertained a $50,000 secured bond, which the client’s family subsequently posted. At the initial pretrial conference the, Commissioner granted the State’s motion to designate the case “complex” and reset the last day. An additional motion to modify release conditions had been filed at this time and a hearing was set to address that two weeks after the IPTC date. Subsequent to this court hearing co-counsel and I met with Mr. M to discuss his options in this case and the strategy that would be taken. During this meeting, we determined the best strategy would be for us to try to negotiate the best plea offer possible and  potentially  have  our  client  speak  with  the  Prosecutor  and/or  Detective.  Soon after this meeting, we received our first offer from the Prosecutor, which was five years in the Department of Corrections with a probation tail.  On Two weeks later, myself and co-counsel appeared to address our additional motion to modify release conditions – specifically requesting that Mr. M be able to reside in Pennsylvania while the case was ongoing. This motion was granted by the court.

After having received the voluminous discovery on this case, both co-counsel and I spent hours reviewing and summarizing the accusations being made by the State. We also spoke with our client about sending information to provide in a deviation letter to the Prosecutor.

A deviation letter was prepared and submitted to the Prosecutor for review. Although the deviation was denied, the Prosecutor indicated he was open to reconsideration with additional information. Subsequently, interviews began to commence. Soon after this, the Prosecutor approached us regarding a potential “free-talk” with our client. A free-talk occurred another free-talk occurred shortly thereafter. After the second free-talk, a modified offer was extended to either five years in the Department of Corrections or a range of three to seven years. After conveying this new offer to Mr. M, he requested we counter with a request for intensive probation for a stipulated term of seven years with counseling, community service and a fine of $10,000. This counter-offer was requested and staffed by the Prosecutor and ultimately we were successful in getting a meeting scheduled with the elected Maricopa County Attorney and the Prosecutor. We met at the County Attorney’s Office in an effort to have a probation offer extended. Unfortunately, there was no agreement on that, however, the State advised that we could pick a judge for change of plea and sentencing and they would not oppose whoever we chose.

Eventually a settlement conference occurred before a settlement Judge. At this time, Mr. M entered the plea agreement that allowed for a range in the Department of Corrections of anywhere between three to seven years. The plea was not accepted at the time that it was entered, in order to allow Mr. M to remain out of custody pending sentencing. I appeared for the sentencing and argued mitigating factors. Mr. M was sentenced to the low end of the range at 3.75 years in the Department of Corrections, and given credit for 53 days of presentence incarceration. He was placed on probation for 3 years following that term in the Department of Corrections.

FELONY TAMPERING with PHYSICAL EVIDENCE, FELONY CONSPIRACY TO COMMIT PERJURY, FELONY OBSTRUCTION of a CRIMINAL INVESTIGATION and FELONY FRAUDULENT SCHEMES REDUCED to PROBATION with ZERO DAYS in JAIL – State v. Mr. A (DMC No. 11855) (Maricopa County Superior Court CR2013-000547):

Mr. A was cited with a Misdemeanor DUI in the City of Gilbert. He then retained the services of Mr. K (a high profile defense attorney in the Phoenix area) in order to defend him. He provided Mr. K with a cell phone video purporting to be video taken from the front of his vehicle as a “dash cam” at the time of the stop. On the video, it showed him properly exiting a bar parking lot and driving correctly without any traffic violations. He was also narrating while he was driving, and claimed that an Officer was pulling up behind him and stopping him. He then stopped the cell phone video.

Unbeknownst to Mr. K, Mr. A falsified the video. He then had a co-worker alter the date time stamped on the video. It was of such quality that Mr. K’s forensic expert analyzed the video and wrote a report finding the video was accurate and untampered with. All of that information was then submitted to the Gilbert City Prosecutor and the DUI charge was dismissed against Mr. A.

The co-worker who had altered the video for Mr. A subsequently had a falling out with him. He then contacted Police and reported Mr. A. Mr. A was subsequently charged with Fraudulent Schemes, Tampering with Evidence, Obstructing a Criminal Investigation and Conspiracy to Commit Perjury. We were then retained by Mr. A. Myself and my partner, Christine Whalin met and formulated the strategy to (1) legally attack some of the charges as not  being  factually  sufficient  as  to  the crime  actually  committed,  (2)  gather  all  mitigating evidence regarding Mr. A, (3) agree to full restitution as to the Gilbert Police Department’s estimation  (which  was  in  the thousands  of dollars),  and  (4) meet  with  the Prosecutor and Prosecutor’s Supervisor to try and achieve an offer which would not result in any prison or jail time.

As the case progressed, my partner, Certified Criminal Law Specialist Christine Whalin and myself met at the Maricopa County Attorney’s Office with the Prosecutor and her Supervisor. Although we could not secure an offer which would allow for only a Class 6 Open/Misdemeanor, we did secure an offer which resulted in the dismissal of the Class 2 Fraudulent Schemes per Arizona Revised Statute ARS 13-2310. Mr. A pled to Obstructing a Criminal Investigation per Arizona Revised Statute ARS 13-2409, (a Class 5 Felony), an amended charge of Tampering with Physical Evidence per Arizona Revised Statute ARS 13-2809, and Solicitation to Commit Perjury per Arizona Revised Statute ARS 13-2704 and 13-1002,  (both Class 6 Open Felonies). There was also no agreement as to sentencing. After I conducted the mitigation hearing, the Judge sentenced Mr. A to supervised probation with no jail time. This was a very high profile case that was covered by the press throughout each and every step of the proceedings.

REDUCED (ALL) | 2 COUNTS of FRAUD SCHEMES ($1.5 million dollars)/8 COUNTS of THEFT and 1 COUNT CONSPIRACY all REDUCED to SOLICITATION with PROBATION and ZERO DAYS JAIL – State v. Mr. T. (DMC No. 9738) (Maricopa County Superior Court CR2009-007971): Mr. T. and co-defendants developed a condominium resort in Rocky Point, Mexico by the name of “The Pointe”.  They began selling the condominiums in Arizona without the proper Arizona Department of Real Estate disclaimer.  After they collected approximately $1.8 million dollars, they could not secure financing to finish the project.  Approximately $1.5 million dollars of that money was spent and could not be recovered.  We were able to show the Prosecutor and the court that there was no real criminal intent on Mr. T.’s part, and that he was making great strides to pay back the restitution.  He was ultimately only given a single count of “solicitation of theft” with probation and zero day’s jail.  The co-defendants were not as lucky.

 

REDUCED | FRAUD SCHEMES/EMBEZZLEMENT ($506,000); REDUCED to THEFT with 1 YEAR in PRISON – State v. Ms. C. (DMC No. 8534) (Maricopa County Superior Court CR2009-143747): Ms. C. worked in the accounting department of a home mortgage company.  She developed a gambling addiction and wrote 104 checks totaling $506,000 to herself over the course of several years.  Although the money had been spent, we were able to have Ms. C. enrolled into a gambling addition program, and we secured an offer that capped mandated prison time at 1 ½ years.  Through our mitigation efforts, the judge only sentenced Ms. C. to 1 year in prison.  With early release and time off for good behavior, she was released after 7 months.

EMBEZZLEMENT/FRAUDULENT SCHEMES ($451,000) and THEFT REDUCED to ATTEMPT and FORGERY with 4 YEARS in PRISON – State v. Ms. P (DMC No. 6934) (Maricopa County Superior Court CR2005-034311): Ms. P began working for an engineering company after she had been out of work for 18 months. She had given birth to a son who had various health problems and had run up numerous medical bills. As creditors began to hound her, she began writing checks directly from the company to herself, and forged the signature of the owner. Over the course of 3 years she had embezzled $451,000. Even though she easily paid off the medical bills, she continued to take money because of the life style. Prosecutors were originally seeking to send her to prison for over 10 years. We were able to bring in a Mitigation Specialist who interviewed various witnesses and provided psychological assessment of Ms. P. We secured an offer to an Attempted Fraudulent Schemes and Forgery which gave the judge discretion to sentence Ms. P to anywhere from 3.5 years of prison on the low end, up to 8.75 of years on the high end. The judge gave a 4 year sentence (less than half of what was possible). With good behavior, Ms. P was released from prison after 3 years and 4 months of her sentence was complete.

ILLEGALLY CONDUCTING an ENTERPRISE/RICO ($251,000), FRAUDULENT SCHEMES, PARTICIPATING in a CRIMINAL SYNDICATE, (20 COUNTS) FORGERY, (9 COUNTS) IDENTITY THEFT & (14 COUNTS) FRAUDULENT PREPARATION of TAX RETURNS REDUCED to 1 COUNT of POSSESSION of a FORGERY DEVICE (Class 6 Open/Misdemeanor) with PROBATION and ZERO DAYS in JAIL – State v. Ms. D (DMC No. 8354) (Maricopa County Superior Court CR2007-008286): Ms. D’s father owned a tax preparation business that she worked for. Her father and his wife would meet numerous clients and sign them up for tax services. It appeared that her father was receiving falsified Social Security cards and other false documents in order to file fraudulent tax returns. After their returns were prepared, Ms. D’s father would ask her to sign his signature on the returns themselves.  This resulted in over $1,000,000 of loss in tax revenue.

Although Ms. D and both her parents were indicted along with other co-conspirators, she had no direct information that these were fraudulent returns. Through Forensic Accounting, hand writing experts and numerous interviews we were able to show that she was an innocent pawn in the fraudulent scheme. Her father ended up being sentenced to prison, and Ms. D had all 46 counts reduced to a single count of Possessing a Forgery Device (i.e. holding a pen that signed her father’s names to the returns) in exchange for Probation with no jail. When she completed probation, that one charge was converted to a Misdemeanor. Ms. D has no felony on her record.

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