Federal Grand Jury Indictment Charges San Antonio Area Businesswoman And Six Others In Connection With Estimated $1.6 Million Fraud Scheme
In San Antonio, seven individuals face federal charges in connection with an estimated $1.6 million wire fraud scheme announced United States Attorney Robert Pitman and FBI Acting Special Agent in Charge Aaron C. Rouse.
Charged in the indictment include: 46–year-old Boerne, TX, resident Lea Ann Blystone, owner and managing partner of HipDingo stores in San Antonio, Boerne and Fredericksburg and former marketing director for a land development company, Rinco of Texas, Inc. (Rinco), and Rockin’ J Ranch (Rockin’ J); her ex-husband and Rockin’ J contractor, 49-year-old Michael J. Webb of San Antonio; 48-year-old Rockin’ J contractor Karen Lindsay of Boerne; 56-year-old Boerne resident and Rockin’ J contractor Cheryl E. Hartsfield; 47-year-old Boerne resident and Rockin’ J contractor Roy E. Pokrant, Jr.; 47-year-old Boerne resident and Rockin’ J contractor Thomas J. Worsham; and, 47–year-old Rinco employee and HipDingo co-owner Manson Porter of Boerne.
The indictment, returned on March 5, 2014, and unsealed this afternoon, charges Blystone with eight counts of wire fraud, twelve counts of forged endorsements and two counts of witness tampering. Porter is charged with three counts of wire fraud and two counts of witness tampering. Each of the remaining defendants is charged with three counts of wire fraud.
According to the indictment, from January 2009 until August 2011, Blystone, with assistance from the other defendants, devised and implemented a scheme to defraud Rinco, Rockin’ J, Security State Federal Credit Union and others to obtain money and other property by means of false and fraudulent pretenses. As marketing director for Rinco and Rockin’ J, Blystone coordinated staffing and vendor payments for promotional booths or display space at shows, malls, sporting and other events.
In the scheme, Blystone caused Rinco and Rockin’ J to make checks payable based on numerous fraudulent third-party contractor invoices submitted which greatly overstated the actual operating costs of the promotional booths. Blystone also caused Rinco and Rockin’ J to fraudulently pay defendants Webb, Lindsay, Hartsfield, Pokrant and Worsham for staffing the promotional displays. In some instances, the indictment states that Rinco and Rockin’ J paid for services when no promotion had been done at all at a stated location, or for work performed for the benefit of Blystone and Porter at HipDingo.
Blystone allegedly forged the names of payees on the back of Rinco and Rockin’ J checks and deposited the proceeds into a bank account under her control. Blystone also caused one or more of her fraudulently paid co-defendants to give her a portion of their illegally derived proceeds. The indictment further alleges that Blystone used money derived from her scheme for inventory acquisition and payroll at HipDingo.
The indictment also alleges that on two separate occasions during the investigation, Blystone and Porter tried to persuade an individual to provide false information or recant information already provided to FBI agents.
Furthermore, the indictment contains a notice for demand for asset forfeiture whereby the Government is seeking the criminally derived proceeds of the scheme, namely: four real estate properties located in Boerne; all inventory, assets, bank accounts and equipment owned, held or maintained by HipDingo, LLC., Blystone and Porter; and, four vehicles. The Government is also seeking a monetary judgment in this case in the amount of $1,597,708 representing the amount of proceeds traceable to the above mentioned scheme.
Upon conviction, each wire fraud and witness tampering charge call for up to 20 years in federal prison; each forged endorsement charge, up to ten years in federal prison.
These charges resulted from an investigation conducted by agents with the Federal Bureau of Investigation. Assistant United States Attorney William R. Harris is prosecuting this case on behalf of the Government.
An indictment is merely a charge and should not be considered as evidence of guilt. The defendants are presumed innocent until proven guilty in a court of law.