| FOR IMMEDIATE RELEASE September 24, 2009 WWW.USDOJ.GOV/USAO/CAN |
SAN JOSE – A federal grand jury in San Jose indicted Seth Sundberg, a.k.a. Franco Metcalf, of San Mateo, California, yesterday for mail fraud, filing a false tax return, and false claims against the United States, United States Attorney Joseph P. Russoniello and Special Agent in Charge, IRS Criminal Investigation, Scott O’Briant announced.
According to the indictment, Sundberg, 34, is alleged to have filed a false Form 1040 Individual Income Tax Return for the 2008 tax year with the Internal Revenue Service. On that tax return, Sundberg falsely claimed to have paid $5,732,441 in tax as a result of receiving purported “original issue discount” (“OID”) income. As a result of this claim, on or about May 29, 2009, Sundberg received a refund check from the IRS in the amount of $5,083,609.25.
According to a criminal complaint filed by an IRS Special Agent, the refund check issued by the IRS was deposited into a Borel Private Bank & Trust account under Sundberg’s name. Sundberg made numerous withdrawals from that account. The withdrawals included wire transfers out of the account to other accounts controlled by Sundberg totaling $3,685,609.25. In addition, Sundberg delivered three cashier’s checks payable to Acts Revival Center in San Jose which totaled $429,000. Levies have been placed on Sundberg’s bank accounts at Borel Private Bank & Trust, Bank of America, and Citibank.
Sundberg was the branch manager for Access Mortgage and Financial in San Mateo. He was also the Principal for Sound Mountain Investments, LLC (SMI) in San Carlos, a corporation which specializes in consulting, private placement investments, marketing, and real estate property management.
Sundberg was arrested on September 9, 2009 in San Carlos and made his initial appearance in federal court in San Jose the same day. Sundberg is currently being held without bail. The defendant’s next scheduled appearance is at 9:00 a.m. on September 30, 2009 before Judge Jeremy Fogel.
The maximum statutory penalty for each count of mail fraud in violation of Title 18, U.S.C., § 1341, is 10 years in prison and a fine of $250,000. The maximum statutory penalty for filing a false tax return in violation of Title 26, U.S.C., § 7206(1), is three years in prison and a fine of $100,000. The maximum statutory penalty for making a false claim against the United States, in violation of Title 18, U.S.C., § 287, is five years in prison and a fine of $250,000, or twice the value of the gross gain or loss. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Jeffrey Schenk is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Legal Tech Jeanne Carstensen. The prosecution is the result of an investigation by the Internal Revenue Service – Criminal Investigation.
Please note that an indictment contains only allegations against an individual and, as with all defendants, Sundberg must be presumed innocent unless and until proven guilty.
Further Information:
Case #: CR-09-00928-JF
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