Criminal Proceedings

January 26, 2022

Todd Kozel was sentenced to five years in prison and ordered to pay restitution of $29.5 million to the IRS following his guilty plea on tax charges.  Kozel worked abroad as the CEO of an oil company with operations in Iraq, earning compensation in excess of $66 million.  However, Kozel failed to file personal federal income tax returns, using sophisticated offshore structures, trusts, and bank accounts to conceal undeclared income from the U.S. government.  SDNY

January 20, 2022

Florida resident Mary Kathryn Marr was sentenced to 14 years in prison following her guilty plea on charges related to her role in a criminal enterprise that scammed victims into sending members of the conspiracy funds for fraudulent investments based on high-pressure “boiler room” tactics.  The conspirators operated a network of bank accounts in the names of shell companies into which the boiler room agents, and sometimes Marr herself, instructed victims to send their money.  The victims’ funds were then laundered through more bank accounts and sent overseas.  Marr was also ordered to forfeit various assets, pay a fine of $1.5 million, and pay restitution of $14.5 million to victims.  USAO MD FL

January 14, 2022

Perry Santillo was sentenced to 17.5 years in prison and ordered to pay restitution of more than $100 million following his conviction on charges related to fraudulent investment schemes including the solicitation of funds through and for Lucian Development and City Capital Corporation.  The Ponzi scheme, which operated over ten years, obtained at least $115.5 million from approximately 1000 investors. Santillo and his co-conspirators purchased the businesses of investment advisors and brokers around the country in order to find potential new investors, and used new investments to fund their lavish lifestyles and make interest and other payments to earlier investors. USAO WD NY (related co-defendant)

January 14, 2022

A former official with the Department of Defense’s Office of Inspector General who was accused of accepting bribes on a prime contract and defrauding the government has been sentenced to 7.5 years in prison.  While overseeing a contract that allowed federal agencies in the DC area to order telecommunication services and equipment, Matthew LumHo solicited and received bribes from a co-conspirator, William S. Wilson, in exchange for steering business to Wilson’s company.  Lumho also knowingly authorized fraudulent service orders for marked up services—essentially defrauding the government into paying for the bribes themselves—and repeatedly interfered with the criminal investigation.  USAO EDVA

January 11, 2022

A man who orchestrated a $10 million tobacco excise tax evasion scheme against the State of Washington, engaged in money-laundering, and evaded $850,000 in federal income taxes has been sentenced to a little over 2 years in prison and ordered to pay $5 million in restitution.  Through his company, TC MAC, Hyung Il Kwon of Nevada purchased significant quantities of tobacco in cash, failed to report the purchases to the state, and subsequently resold the products for cash.  In order to avoid alerting the state to large cash deposits, Kwon then laundered the money by writing checks in exchange for large amounts of cash.  Kwon has a prior state conviction for similar charges.  USAO WDWA

January 10, 2022

Following his guilty plea on charges related to the filing of false tax returns claiming nonexistent fuel tax credits, Michael Dexter Little was ordered to forfeit $12.3 million and sentenced to 19.5 years in prison.  Little and his fellow fraudsters filed false tax returns in their own names and in the names of identity theft victims, and laundered the proceeds via real estate and other assets. USAO MDFL

January 5, 2022

A Kansas-based contractor who illegally obtained $346 million in contracts set aside for service-disabled veterans and certified minorities has been sentenced to a little over two years in prison and ordered to forfeit over $5.5 million.  Between 2009 and 2018, defendant Matthew McPherson was awarded approximately 199 federal contracts, upon which he was paid approximately $335 million, through Zieson Construction Company, which was nominally owned by an African-American service-disabled veteran.  When the company grew too large to compete for small business contracts, McPherson used an employee’s Native American minority status to set up Simcon Corp in order to obtain additional contracts.  USAO WDMO