State v. Mr. C (DMC No. 14920) – Felony Benefits Fraud – Not Charged – Social Security Administration Investigated: Mr. C had secured two different Social Security numbers and had been receiving benefits from Social Security which were duplicating under the two different identities. We were able to put together a letter and speak with the Investigating Agent to show that somewhere along the line there had been a confusion or Scribner’s error regarding Mr. C’s Social Security number. We negotiated the repayment of any overages that may have been paid, and the Investigator agreed that once the problem was fixed, that this took care of the incident. No charges were ever brought against Mr. C.
State v. Mr. M (DMC No. 11444) – Felony Fraudulent Schemes (Counterfeiting $20 Bills), Felony Counterfeiting, Felony Theft & (2 counts) Felony Forgery – Not Charged – Maricopa County Sheriff’s Office investigated (DR#20XXX-XXXXX7).
Maricopa County Sheriff’s Office was called to a CVS Pharmacy located in Queen Creek. When they arrived, they spoke with a manager who sated that Mr. M. had come into the store and utilized a counterfeit $20 bill to purchase a $1 item and then he received $19 in change. They stated that this had occurred to them in the past also. The manager had taken down the license plate number from the video in the parking lot before Mr. M. left. The Officers ran the license plate and then showed up at Mr. M’s residence. Mr. M lived with his parents, and only the father was home when the Police arrived. The father allowed them to search Mr. M’s room, and it was discovered there was a computer, a scanner and a shedder inside the room. Contained in the shredder were several pieces of shredded counterfeit money.
When contact was made with Mr. M, he invoked his right to remain silent. We then became involved in the case and we had Mr. M. sign an Affidavit that he was invoking his right to remain silent if he were to be contacted by Detectives in the future. We also spoke with Detectives about the fact that the computer in the household was a “community computer”, and it was not password protected. Lastly, we pointed out that they had no video evidence of the alleged prior incidents occurring at that CVS and other stores in the surrounding neighborhoods. Eyewitnesses could not pick Mr. M out of any photo line-ups, and he had made no admissions to knowledge of the counterfeit money. Ultimately, the Sheriff’s Detective routed the case to the Maricopa County Attorney’s Office seeking a charge of Fraud Schemes, Theft, and two counts of Forgery. It was also possible that a charge of Counterfeiting could have been tacked on. However, the Maricopa County Attorney’s Office made the decision to “turn down” the case. Mr. M has no criminal record.
State v. Mr. H (DMC No. 11744) – Felony Illegally Conducting an Enterprise/RICO ($132,755 in Counterfeit Checks), Felony Computer Tampering, Felony Attempted Fraudulent Schemes & (2 Counts) Forgery – Reduced to Possession of a Forgery Device with Probation and Zero Days in Jail – Maricopa County Superior Court (Case No. CR2013-002470).
Mr. H was involved in an Illegal Enterprise which was engaged in manufacturing fake checks and then cashing them. The checks were manufactured by utilizing a computer to print false checks with false bank routing numbers. This particular activity is known as “Computer Tampering.” Once the Illegal Enterprise would create the fake checks, they would then be distributed to individuals to cash at various retail outlets. Mr. H. was one of the people who received checks that were created by the Enterprise and he was one of the individuals responsible for cashing them. Once the Police became aware of this, they arrested several of the check cashers and had them become “Confidential Informants.” Eventually, a 61 co-defendant indictment, which included 328 charges, was handed down by a Grand Jury.
When we became involved in the case, we immediately began working with Detectives and Prosecutors in order to cooperate and to provide Mitigation on Mr. H’s behalf. Unfortunately, Mr. H. had become addicted to heroin, and had only gone for various brief stretches in his life where he was sober. He was married and had several small children when he fell off the wagon. He had lost his job and started using heroin again.
He became involved in the Conspiracy in order to receive money to support his drug habit. During the Pretrial phase of the case, we had Mr. H. go into inpatient rehab, which he successfully completed. We also had him make Restitution in full for his portion of the Fraud Scheme. Ultimately, the Prosecutor offered a plea to Possession of a Forgery Device, which included Probation and Zero Days in Jail. If Mr. H. had been convicted of all charges, there would have been mandatory Prison time required due to the amount of the loss being greater than $100,000. He is now sober and his family is intact.
State v. Ms. C (DMC No. 15373) – Felony Benefits Fraud/Fraudulent Schemes ($7,758 misappropriated from DES Contractor), Felony Conspiracy and Felony Theft – Reduced to Probation with Zero Days of Jail – Maricopa County Superior Court (Case No. 2017-001677). Ms. C had been working through a company that contracted through DES’ Division of Developmentally Disabled (DDD). It appeared that she had been overbilling people for services that were never performed. The company that had contracted with DES discovered that their employee (Ms. C) had inconsistent hours which were being billed on the hard copies as opposed to what was billed on the computer systems. Once the company had discovered this, they reported the Fraud Scheme to the police. Multiple checks had been written to Ms. C for work that had never been completed. These checks total $7,758. We became involved and began cooperating with the Prosecutor and Detectives in order to secure a reduced sentence. A co-defendant, who had been part of the scheme, was ultimately charged and convicted of the more serious crimes. Ms. C was facing several years in prison if she would have been sentenced and convicted on all charges.
State v. Mr. K. (DMC No. 13080 and DMC No. 11324) – Felony Medicare Insurance/Benefits Fraud ($1,500 Misappropriated from Medicare), Felony Fraudulent Schemes and Felony Forgery – Not Charged and Physical Therapy License Not Revoked at Professional Hearing – Arizona Board of Physical Therapy Investigated.
Mr. K worked as an independent homecare contractor regarding services for physical therapy. Mr. K allegedly billed Medicare for 15 home visits on a client in which he only did 7 visits. He was accused of signing the patient’s name on the visit confirmation slips for all 15 visits. He was eventually contacted by the Arizona Board of Physical Therapy regarding allegations of Medicare Insurance Fraud, Fraud Schemes, and Forgery.
We became involved when we represented Mr. K in front of the Arizona Board of Physical Therapy. Discrepancies in the record were clarified and Medicare was made whole. In the end, Mr. K was not charged with any criminal charges and he was allowed to keep his physical therapy license.
State v. Ms. R (DMC No. 14569) – Felony Embezzlement ($50,000 Misappropriated from Interior Design Business), Felony Fraudulent Schemes, Felony Theft, Felony Identify Theft, Felony Forgery and Felony Obtaining a Credit Card by Fraudulent Means – Not Charged – Phoenix Police Department Investigated (DR No. 20XX-XXXXXXX3).
Ms. R was employed as a bookkeeper/personal assistant to the owner of an interior design business. She had access to all information regarding the business, and access to the checking accounts in order to pay business expenses. She was accused of using 3 different bank accounts and obtaining 5 different credit cards fraudulently by assuming the identity of the owner. Over the course of three years, she allegedly embezzled over $50,000.
We were brought into the case and we began defending Ms. R. We contacted the interior design business owner’s husband who was a licensed attorney in Arizona. We were able to demonstrate that some of the credit cards obtained were actually in our client’s name, and those were used actually to pay business expenses. The itemized business expenses on the credit card were then paid by company check. What became problematic was demonstrating other credit cards taken out in the owner’s name had a forged signature on the application in violation of ARS 13-2102. The owners ultimately filed a police report with the City of Phoenix. We had always contended that this was actually a civil matter, and not a criminal matter, and ultimately the Phoenix Police Department did not forward the case onto the County Attorney’s Office for charging. No criminal charges were ever brought against Ms. R. If they had been, and if she were convicted of all charges, she would have faced well over a decade in prison. As it finalized, no criminal charges were ever brought against Ms. R and she has no criminal record.
U.S. v. Mr. T (DMC No.14567) – Federal Felony Conspiracy to Commit Money Laundering ($175,000), Felony Conspiracy to Distribute a Controlled Substance (5kg of Steroids/383,000 Dosage Units), Felony Conspiracy to Import a Controlled Substance, and Related Forfeiture Issues – Reduced to 1 Count Conspiracy with Intent to Distribute Steroids with Probation and 7 Months of Incarceration and Forfeiture Amount Reduced from $175,000 to $25,000 – United States District Court, District of Arizona (Case No. CR-15-01044-002-PHX-DLR).
Investigators in Phoenix became aware of seizures of packages at the Port of Entry in San Francisco, which were destined for Phoenix and contained both anabolic steroids and synthetic male hormones. One package contained 400 tablets of counterfeit Cialis, and 200 tablets of counterfeit Viagra. Although they are not controlled substances, they are frequently used in conjunction with anabolic steroids to counter impotency.
An investigation unwound in which Mr. T and his co-defendant were seen on a weekly basis traveling to a commercial warehouse in Phoenix. They would then go to various post offices and postal stores to mail parcels to destinations outside of Arizona. The Agents confirmed that the packages contained anabolic steroids and other controlled substances. Investigators also discovered that Mr. T and the co-defendant would travel to multiple Safeway stores and Fry’s stores that advertised Western Union services. They would do multiple wire transfers for $925. Any Western Union money transfer over $999 requires identification. By keeping the number under $999, they were able to avoid detection per that requirement.
During the investigations with the Postal Inspectors, they discovered that over a three-year period Mr. T had sent wire transfers to Israel and China totaling more than $75,000. Other wire transfers were discovered and eventually an arrest warrant was issued. Mr. T was found to be holding $25,000 in cash, over 300,000 dosage units of steroids, and multiple pieces of equipment for manufacturing steroids from analog chemical components. Agents seized approximately $125,000 of Mr. T’s cash, along with a Toyota Prius.
We became involved in the case and began working with the Assistant U.S. Attorney and the investigating Agents. Mr. T demonstrated a complete acceptance of responsibility through cooperation with Agents, whereby they were provided information on sources of steroids that come in from different countries including Israel, Turkey, Moldovia, Bosnia, and China. Ultimately, the Assistant US Attorney agreed to extend an offer which included 1 year in prison.
Mr. T was ultimately charged with Felony Conspiracy to Commit Money Laundering, per 18 U.S.C. 1956(h); Conspiracy to Distribute a Controlled Substance – 5kg of Steroids/383,000 Dosage Units, per 21 U.S.C. 846; Felony Conspiracy to Import Controlled Substances, per 21 U.S.C. 963; and a Forfeiture Action was filed regarding $175,00 in cash and a Toyota Prius, per 18 U.S.C. 981, 21 U.S.C 853 and 881, and 28 U.S.C. 2461(c). At the time of Sentencing, we were able to present significant mitigation to the Judge and have the sentence reduced to a mere 7 months. In addition, at the Forfeiture Proceedings involving this case, the amount was reduced from $175,000 down to $25,000, thereby saving Mr. T approximately $150,000 of his money. Potentially, Mr. T could have spent well over a decade in prison if there had been no mitigation and cooperation proffered in his case.
U.S. v. Ms. G (DMC No. 14158) – Federal Felony Mortgage Fraud ($1,100,000), Federal Felony Bank and Wire Fraud, Felony Fraudulent Schemes, and Felony Forgery – Not Charged – Large National Bank Investigated.
Ms. G and her husband were going to purchase a large house for approx. $1,000,000. The appraisal information was sent from the loan originator, and the loan originator specifically asked if any funds were going to be pulled from a retirement account, to which Ms. G and her husband said “no.” Ultimately, discrepancies were found in the closing documents, and in order to close on the house, Ms. G had the house purchased in her husband’s name only. This was accomplished through a Special Warranty Deed signed by the husband “as a married man as his sole and separate property.” Ms. G signed a Disclaimer Deed disclaiming any interest in the property. Also, they both signed a Warranty Deed conveying property from husband’s sole and separate property to husband and wife.
The potential problem was that the Disclaimer Deed signed by Ms. G indicated that none of her assets or community assets were used in the purchase of the home. This is not accurate as a joint check was used for the purchase. In addition, the intent was always to use community assets to buy the home. After the closing, the bank discovered discrepancies and began investigating. A potential concern was that Forgery was committed, along with allegations of Fraudulent Schemes, and Mortgage Fraud per Arizona Revised Statue 13-2320. Lastly, a potential for Federal Bank and Wire Fraud was also possible due to the federal loan documents which were signed.
We were able to show although Ms. G did not sign the document indicating the property was purchased with separate funds of the spouse, that it must be read in conjunction with the other documents signed by Ms. G at the same time. Specifically, that Mr. G. received title through the Special Warranty Deed the day before the Disclaimer Deed, and that he signed the Warranty Deed at the same time as the Disclaimer Deed, thereby suggesting that they were meant to function together to promote the buyers’ intent (as outlined in both the purchase contract and the loan pre-qualification form).
We were able to show that none of the documents were indicative of any intent to defraud. The only real issue had to do with community property issues down the road should they become divorced. Initially, Ms. G was facing the potential of multiple years in prison, but we were able to convince the bank not to turn this into a criminal matter and get the authorities involved.
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.
A DPS Detective on the Mortgage Fraud Task Force was researching the names used by individuals to purchase two specific properties which totaled $650,000 in value. He pulled up the MVD database and utilized their facial recognition system to show that the names given with purchases per MVD records, did not match faces that were on their licenses in the database. Also, different dates of birth and social security numbers were used. He then compared those images with pictures of our client on Facebook and he found that there was a match.
He then researched the mortgage documents from the mortgage company and analyzed the Residential Loan Applications. He discovered that Real Estate Agent, conspiring with the Loan Officer, then made contact with a Loan Processor and our client (who is the buyer of the purchases/two mortgages). He discovered that these were actual “straw purchases” that were being facilitated by way of forgery and fraud on the various banking institutions that loaned the money for the residential purchases.
We were able to show the Prosecutor that our client’s only connection to this scheme was that he used a false identity to purchase the houses. Although this could still be charged as Forgery, we proved he did not have the required mental state relating to Fraud Schemes to show that he “knowingly obtained any benefit by using the fraudulent name.” The Prosecution agreed to reduce the charges to Securing the Proceeds of an Offense, which carried with it probation and zero days in jail. Originally, our client was facing mandatory prison due to the fact that the amount of the Fraud Scheme was above $100,000.