Procedure Skyfall: AG James Announces Convictions In $3 Million Dollar Loan Fraud And Cash Laundering Scheme

Procedure Skyfall: AG James Announces Convictions In $3 Million Dollar Loan Fraud And Cash Laundering Scheme

Kenneth Martinez and Metropolitan EnterprisesConvicted for Stealing Over $455,000 in Taxes

<>Three Defendants and Three organizations Plead Guilty to Felony Chargesand Must Pay a complete of $1.5 Million in Restitution and Judgments

Kenneth Martinez, Owner of Metropolitan Enterprises, Sentenced to Three to Nine Years in jail

NEW YORK – Attorney General Letitia James today announced the felony beliefs of three people and three businesses, due to an investigation that is three-year fraudulent techniques into the scaffolding industry carried out by the Attorney General’s Office, with the Port Authority of the latest York and nj-new jersey, the brand new York state dept. Of Taxation and Finance (DTF), plus the new york class Construction Authority. The joint research — dubbed “Operation Skyfall” — unveiled that the six co-defendants involved with a two-year scheme to defraud finance institutions away from vast amounts, then laundered the profits through numerous organizations.

“We are all devoted to uncovering and prosecuting companies that have actually defrauded their state and many banking institutions away from millions, ” said nyc Attorney General Letitia James. “These fraudsters must now need to pay right right back taken funds and cease their unlawful operations. Allow this be described as a course to each and every specific and company that people shall never ever stop fighting against those that make an effort to defraud New Yorkers.

In Suffolk County Court, Kenneth G. Martinez (51, of Lawrence), Shai Sellam a/k/a Sean Green (45, of Woodmere), and Hayim Jacob Barkol f/k/a Kadir Barkol (39, of Brooklyn), with their particular businesses, Metropolitan Enterprises, Inc., brand brand brand New Route asking Inc., and Lifting Up Management LLC had been convicted of felonies for participating in a three-million dollar loan fraudulence and cash laundering scheme between October 2013 and April 2015.

The defendants and their corporations were ordered to pay a total of $1.5 million in restitution and judgments to financial institutions and to New York State as part of their guilty pleas. Defendant Martinez had been sentenced to nine years in State Prison in the Albany income tax instance; he could be planned become sentenced up to a term that is concurrent of to nine years in state jail in the Suffolk loan fraudulence situation on October 17, 2019.

“The result in this situation — for which a company and its own owner did not spend $455,000 in product sales taxation collected from customers — should act as a caution to all the people who blatantly disregard our taxation laws, ” stated nyc State Commissioner of Taxation and Finance Michael Schmidt. “We works with Attorney General James and all sorts of amounts of police to split straight straight straight down with this variety of fraudulence, which deprives New Yorkers of income necessary for vital solutions and programs within their communities. no telecheck payday loans

“I wish to thank the brand new York State Attorney General for accepting our recommendation for this matter and their joint work in investigating and prosecuting the 3 individuals and associated three businesses, ” stated Port Authority Inspector General (IG) Michael Nestor. “The Port Authority IG commenced this research based on allegations that Metropolitan Enterprises, Inc., a scaffolding and business that is hoisting its President, Kenneth Martinez might not be a legitimate Minority Business Enterprise business performing just work at the entire world Trade Center web site. Our investigation that is joint with Attorney General’s workplace, uncovered proof of unlawful task with two other people and businesses. This investigation uncovered a cash laundering scheme and other crimes that are related. The Port Authority IG continues to be committed in preventing similar conduct. ”

“This sentencing shows the necessity of police force partnerships in rooting out corruption by contractors in this town, ” said new york Department of Investigation (DOI) Commissioner Margaret Garnett. “This sort of taxation fraudulence, where in actuality the defendants pocketed a huge selection of thousands in product product sales and make use of fees that will have now been remitted to New York State, diminishes profits towards the federal federal federal government and erodes the power of federal federal government to completely provide the individuals. DOI ended up being very happy to join using the State Attorney General’s workplace and our police force lovers about this research, which revealed and stopped these unlawful schemes. ”

Metropolitan had been considered among the biggest scaffolding and hoisting contractors in brand New York State between October 2013 and September 2015. Public records reveal that in 2015, Metropolitan had been a subcontractor for assorted work done regarding the George Washington Bridge as well as on the Oculus venture during the global World Trade Center Transportation Hub. During this period, the defendants utilized unpaid income tax monies in addition to profits of fraudulently compensated loans to help keep the company afloat. Because of the period of the nyc Attorney General’s indictment that is first 2016, Metropolitan Enterprises, Inc. Went of company.

Based on the felony issue as well as other papers, the defendants perpetrated their loan fraudulence scheme by submitting invoices that are fake a phantom deposit check purporting to offer scaffolding and hoisting equipment from a single of Barkol’s entities to Metropolitan. The truth is, the purported gear either just would not exist or existed but had been owned by Metropolitan or currently encumbered by another standard bank.

To market and conceal their loan fraudulence scheme, the defendants laundered the taken funds through numerous business records. Barkol would cut checks from his business account back into Metropolitan within a matter of times of getting the fraudulently acquired funds, totaling nearly the entire number of the amount of money gotten through the institution that is financial. Monies had been then relocated between Metropolitan’s reports and utilized to pay for debts owed to many other finance institutions, to pay for negative balances, and also to spend present and payroll that is outstanding union dues.

In July 2019, the six defendants had been arraigned in the 1st District Court of Suffolk County for a felony problem charging you cash Laundering when you look at the Second Degree, a course C felony; Grand Larceny when you look at the 2nd Degree, a course C felony; and Scheme to Defraud in the 1st Degree, a course E felony. On August 7, 2019, the defendants joined the next accountable pleas in Suffolk County Court:

  • Kenneth Martinez pleaded responsible to cash Laundering within the Second Degree, a course C felony;
  • Shai Sellam pleaded bad to cash Laundering when you look at the Third Degree, a course D felony;
  • Hayim Jacob Barkol pleaded accountable to Scheme to Defraud in the 1st Degree, a course E felony;
  • Metropolitan Enterprises, Inc. Pleaded bad to Grand Larceny into the 2nd Degree, a course C felony;
  • New Route asking Inc. Pleaded bad to cash Laundering when you look at the Third Degree, a course D felony; and
  • Lifting Up Management LLC pleaded responsible to cash Laundering when you look at the 2nd Degree, a course C felony.

Martinez is anticipated to be sentenced to a of three to nine years in State Prison on October 17, 2019. Sellam faces as much as two to six years in State Prison whenever sentenced on 12, 2020 august. Barkol is anticipated to be sentenced to a phrase of 5 years of probation for their role within the scheme when sentenced on October 17, 2019. All the entities is anticipated to be sentenced up to a three-year discharge that is conditional sentenced on October 17, 2019. Included in their sentences, the defendants must spend restitution and perform confessions of judgments with respect to the finance institutions, totaling $1.5 million.

Besides the loan fraudulence scheme, in June 2017, defendants Martinez and Metropolitan joined accountable pleas to Grand Larceny into the Degree that is second in County Court, associated with their theft of product product product sales and employ fees. Yesterday, Martinez had been sentenced to nine years in State Prison. Also, both defendants performed confessions of judgments for the advantage of the NYS Department of Taxation and Finance, more than $455,000.

These instances are now being prosecuted as an element of ny Attorney General’s Combatting Upstate Financial Frauds and Schemes (CUFFS) Initiative, led by Director Philip V. Apruzzese — an Assistant Attorney General when you look at the Criminal Enforcement and Financial Crimes Bureau. The CUFFS Initiative ended up being implemented by Attorney General James in order to help law that is local and District Attorney’s workplaces within the research and prosecution of complex economic crimes and cash laundering situations.

Assistant Attorney General Apruzzese is prosecuting these cases, because of the support of Legal Support Analysts Kira M. Russom and Supervising Analyst Paul Strocko. The Criminal Enforcement and Financial Crimes Bureau is led by Bureau Chief Stephanie Swenton and Deputy Bureau Chief Joseph D’Arrigo, and it is the main Criminal Division, led by Chief Deputy Attorney General Josй Maldonado.

The Attorney General’s research ended up being conducted by Investigator Mark J. Terra, underneath the guidance of Supervising Investigator Mark Spencer and Deputy Bureau Chief Antoine Karam. The Investigations Bureau is led by Chief Oliver Pu-Folkes. Forensic accounting ended up being carried out by Chief Auditor Edward J. Keegan and Principal Auditor Investigator Jason Blair for the Forensic Audit area.

The Attorney General’s Office thanks DTF’s Criminal Investigations Division, DOI’s workplace of this Inspector General for the NYC School Construction Authority, and, especially, Investigator Charles Shevlin and Assistant Inspector General Nicholas Scicutella, plus the Port Authority of NY/NJ – workplace regarding the Inspector General, and, specifically, Investigator Louis Matirko, for his or her assistance that is invaluable on research.