Mariusz Debowksi pleaded guilty in U.S. District Court in Manhattan to conspiracy to aid another in filing false tax returns.  Between approximately 2000 and February 2005, Debowski conspired with others to falsify income tax returns through a fraudulent check cashing scheme for the owner of a corporation that was engaged in the business of providing maintenance and insulation services to New York Presbyterian Hospital (NYPH).  According to the charge, Debowski provided false documentation to co-conspirators indicating that he had performed construction services and received more than $2.3 million in checks from the co-conspirators as payment for the construction services.  Debowski cashed the checks but returned the bulk of the money to the co-conspirators in exchange for a fee.  The co-conspirators then took false deductions for those payments made to Debowski’s businesses.

“Those who illegally profit from their participation in fraudulent schemes will be vigorously prosecuted,” said Scott D. Hammond, Acting Assistant Attorney General in charge of the Department’s Antitrust Division.

The tax fraud conspiracy that Debowski is charged with carries a maximum penalty of five years in prison, three years of supervised release and a $250,000 fine.  The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

In April 2007, as part of the same investigation, Michael Theodorobeakos and two maintenance and insulation companies he co-owned – Monosis Inc. and STU Associates Inc.–  pleaded guilty to conspiring to rig bids on the supply of maintenance and insulation services to NYPH and Mount Sinai Medical Center (Mount Sinai).  In addition, Michael Vignola and Mister AC Ltd. pleaded guilty in November 2007, to conspiring to rig bids on heating, ventilation and air conditioning (HVAC) services provided to NYPH and paying kickbacks to former NYPH purchasing officials.  In April 2008, Aaron S. Weiner pleaded guilty for participating in a conspiracy wherein Weiner acted as a conduit in another million-dollar kickback scheme also involving one of the same former NYPH purchasing officials involved with the Vignola kickback schemes.

These charges arose from an ongoing federal antitrust investigation of fraud, bribery, tax-related offenses and bidding irregularities relating to contracts administered by the Facilities Operations Department and the Engineering Department at NYPH and the Engineering Department at Mt. Sinai.   The investigation is being conducted by the Antitrust Division’s New York Field Office, the FBI and the Internal Revenue Service Criminal Investigation’s New York Field Office.

Anyone with information concerning bid rigging, bribery, tax offenses or fraud related to contracts administered by the Facilities Operations Department at NYPH or the Engineering Departments at Mount Sinai or NYPH should contact the New York Field Office of the Antitrust Division at 212-264-9308 or the New York Office of the FBI at 212-384-4467.

RICHARD WALTERS SENTENCED IN D.C. PROPERTY TAX REFUND FRAUD SCHEME

Brother of Ringleader Deposited $4,900,199 in Fraudulently Obtained D.C. Government
Checks and Received At Least $1,284,574 in Monies and Home Improvements

Greenbelt, Maryland – U.S. District Judge Alexander Williams, Jr. sentenced Richard Walters, age 49, of Bowie, Maryland, today to 51 months in prison followed by three years of supervised release for receipt of stolen property and conspiracy to commit money laundering in connection with a property tax refund scheme in which over $48 million were stolen from the District of Columbia Office of Tax and Revenue, announced United States Attorney for the District of Maryland Rod J. Rosenstein and U.S. Attorney for the District of Columbia Jeffrey A. Taylor. Judge Williams also ordered that Richard Walters forfeit $4,900,199 and, in order to satisfy such money judgment, to forfeit a home in the Virgin Islands, two homes in Bowie, Maryland, a 2005 Bentley, four other vehicles, jewelry and monies held in several bank accounts.

U.S. Attorney Rod J. Rosenstein stated, “Richard Walters and Harriette Walters deposited fifteen District of Columbia government checks totaling almost $5 million into a bank account in the name of his plumbing business over a period of six years. We will seek the forfeiture of all criminal proceeds and property purchased with stolen money because victims deserve restitution and criminals must not be permitted to profit from their crimes.”

According to the plea agreement, Richard Walters is the brother of Harriette Walters, a former manager within the District of Columbia Office of Tax and Revenue. Richard Walters owned and operated a plumbing business called “Helmet’s Plumbing.” From March 2001 to May 2007, Richard Walters, and on occasion, Harriette Walters with Richard’s knowledge, deposited 15 District of Columbia government checks totaling $4,900,199 into a bank account Richard Walters maintained for his plumbing business. Richard Walters knew that the checks had been obtained by fraud as part of a scheme to embezzle funds from the District of Columbia government. The individual checks ranged in amounts from approximately $95,148 to $541,100.

On many occasions, Harriette directed Richard to take the checks to a bank and have Walter Jones, a bank manager, deposit them into the Helmet account. In addition, on several occasions, Richard Walters deposited a fraudulent District of Columbia government check and immediately thereafter directed Walter Jones to prepare cashier’s checks to recipients of Richard’s choosing.

From July 2001 to November 2007, Richard and Harriette Walters distributed funds from the Helmet account, including at least: 46 transactions directing $1,059,307.50 to accounts controlled by Richard Walters; 14 transactions directing $225,266.87 towards projects for a home that Richard Walters was building in the U.S. Virgin Islands; 11 transactions directing $461,000 to Harriette Walters; $47,149 to the Washington Wizards to purchase season tickets; $40,000 to Neiman Marcus; and $18,100 to Saks Fifth Avenue for purchases. Richard Walters also purchased a 2005 Bentley automobile with proceeds of the fraud.

Harriette M. Walters, age 52, of Washington, D.C., pleaded guilty in the U.S. District Court for the District of Columbia on September 16, 2008 and faces a maximum sentence of 20 years in prison for wire fraud and money laundering conspiracy; 10 years for District of Columbia tax evasion; five years for federal tax evasion; and an order to pay restitution in the amount of $48,115,419.09. U.S. District Judge for the District of Columbia Emmet G. Sullivan has scheduled sentencing for Harriette Walters on March 25, 2009 at 11:00 a.m. Alethia O. Grooms, age 52, of Clinton, Maryland and Samuel Earl Pope, age 61, of Washington, D.C. also pleaded guilty to their participation in the scheme, and are scheduled to be sentenced on February 24 and 26, 2009, respectively.

Patricia A. Steven, age 73, of Harwood, Maryland; Robert Steven, age 55, of Edgewater, Maryland; Connie Alexander, age 52, of Bowie, Maryland; Richard Walters, age 49, of Bowie, Maryland; Walter Jones, age 33, of Essex, Maryland; Marilyn Yoon, age 40, of Derwood, Maryland; and Ricardo R. Walters, age 33, of Ft. Washington, Maryland, have pleaded guilty in U.S. District Court for the District of Maryland to their participation in the scheme. Patricia Steven, Robert Steven, Richard Walters and Alexander each face a maximum sentence of 10 years in prison for receipt of stolen property and 20 years in prison for conspiracy to commit money laundering at their sentencing scheduled by U.S. District Judge for the District of Maryland Alexander Williams, Jr. on December 8 at 10:00 a.m., December 8 at 1:15 p..m., November 4, 2008, and February 12, 2009, respectively. Walter Jones faces a maximum sentence of 20 years in prison and a fine of $500,000 or twice the value of the transactions involved, whichever is greater, for conspiracy to commit money laundering at his sentencing on a date which is not yet scheduled. Marilyn Yoon faces a maximum sentence of 10 years in prison and a $250,000 fine for possession of property obtained by fraud at her sentencing on
December 4, 2008.

United States Attorneys Rod J. Rosenstein and Jeffrey A. Taylor thanked the Federal Bureau of Investigation; the Internal Revenue Service – Criminal Investigation; the Inspector General’s Office for the District of Columbia; the District of Columbia Office of Tax and Revenue, Criminal Investigation Division; the Treasury Inspector General for Tax Administration; and the District of Columbia Office of the Chief Financial Officer, Office of Integrity and Oversight for their investigative work. Mr. Rosenstein commended Assistant United States Attorneys Jonathan Su and Deborah Johnston from the District of Maryland and Assistant United States Attorneys Timothy Lynch and David Johnson from the District of Columbia, who are prosecuting the case.

For more information, CONTACT AUSA VICKIE E. LEDUC or MARCIA MURPHY at (410) 209-4885

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