Fraud News Around the Nation

August 22, 2016
Restaurant Owner Gets Prison Time for Torching Business

A Leominster, Mass., man who set fire to his own restaurant to collect the insurance money has been sentenced to four years in prison.

Jeffrey Cordio, who owned the West End Diner, was also sentenced Wednesday in federal court to three years of probation.

Cordio pleaded guilty in March to a charge of conspiracy to use fire to commit mail fraud for filing the fraudulent insurance claim.

Cordio and a former restaurant employee were seen on surveillance video from a nearby business driving to the diner in Cordio’s truck in November 2013, going in and out several times, before driving away as smoke poured from the building.

Prosecutors say Cordio needed the insurance money “due to significant financial distress and a desire to relocate to Florida.”

He apologized in court.

Missouri Farmer Gets 2 Years for Crop Insurance Fraud

A southeast Missouri farmer has been ordered to spend two years in prison for crop insurance fraud of more than $200,000.

The Southeast Missourian reports that 48-year-old Bobby David Lowrey, of Parma, was sentenced Tuesday for making false statements about crop-insurance benefits, theft of government property and wire fraud. Lowrey pleaded guilty to the charges in May.

Court documents say Lowrey placed farms in other people’s names to obtain payments he was not eligible to receive under the federal government’s crop-insurance program. The documents say Lowrey and his wife had maxed out the benefits they could receive.

Lowrey obtained about $240,000 worth of crop-insurance indemnities and subsidies from 2007 through 2012. Court documents say the payments are considered government property.

22 From ‘Irish Traveler’ Community Indicted for Racketeering, Insurance Fraud

A federal grand jury has indicted 22 people from a so-called Irish traveler community in western South Carolina for racketeering, alleging various violations ranging from food-stamp and tax fraud to money laundering and insurance fraud.

Acting South Carolina U.S. Attorney Beth Drake announced that the 48-count indictment alleging the operation of a criminal organization was returned on Tuesday.

The indictment says the defendants are residents of a community near North Augusta. It says travelers are itinerant laborers and salesmen who go door to door and speak a dialect of English and Gaelic called “Cant,” in addition to American English.

It said many of the defendants “reside in Murphy Village where they own large homes, luxury cars and expensive jewelry and clothes which are often acquired through fraud schemes or acquired with the proceeds of fraud schemes.”

The indictment says those charged are either travelers or their associates.

The government says the defendants committed fraud to obtain things such as life insurance benefits, food stamps, Medicaid funds and automobile financing.

It also alleges some of the defendants participated in money laundering to conceal the source or ownership of their assets. It alleges they structured bank deposits and withdrawals in amounts of $10,000 or less to avoid bank reporting requirements.

The specific counts include conspiracy, mail and wire fraud, and interstate transportation of stolen items. Each carries a maximum sentence of 20 years and a $250,000 fine. The indictment also includes counts of structuring financial transactions to avoid reporting requirements, each of which carries a maximum of five years in prison and a $250,000 fine.

The indictment says that, if the defendants are convicted, assets owned by the defendants are subject to forfeiture to the federal government.

The indictment lists five homes and 25 mostly high-end vehicles including BMWs, Lincolns, Audis and Lexus vehicles that the government says are subject to forfeiture.

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