EX-CONTROLLER OF CARPENTER & COMPANY SENTENCED ON FRAUD AND TAX CHARGES
BOSTON, Mass. - A Pembroke man was sentenced yesterday in federal court for embezzling nearly $500,000 from his employer and failing to report monies stolen and legitimate bonus payments on his federal tax returns.
MATTHEW J. ABUSHEERY, 37, of Pembroke, formerly of Whitman, was sentenced by U.S. District Judge Nathaniel Gorton to 37 months imprisonment, to be followed by two years of supervised release and ordered to pay a $469,403 fine. ABUSHEERY pleaded guilty to July 14, 2010 to five counts of wire fraud and two counts of subscribing a false tax return.
Had the case proceeded to trial the Government’s evidence would have proven that from October 2006 through September 2008, utilizing two separate schemes, ABUSHEERY embezzled more than $450,000 from Carpenter and Company, a Cambridge-based real estate development and management company. At the time he stole the money, ABUSHEERY was Carpenter’s controller and a member of the company’s management team. As controller, ABUSHEERY was responsible for various accounting operations, to include payroll and the day-to-day management of the accounting department, including the accounts payable operation and overseeing Carpenter’s petty cash account.
The evidence at trial would have shown that ABUSHEERY embezzled the money from his employer using two schemes. First, in the payroll fraud scheme, ABUSHEERY fraudulently inflated his bi-weekly salary, causing himself to be paid an amount in excess of his authorized salary. In the years 2006 - 2008, ABUSHEERY’s legitimate compensation from Carpenter, including his salary and annual bonus ranged between $160,00 and $230,000.
Carpenter used a private payroll processing service, Paychex, to handle its employees’ payroll. ABUSHEERY was one of only two people at Carpenter who had access to the Paychex payroll system. ABUSHEERY used his access to the Paychex payroll system to fraudulently inflate the amounts of money Paychex wire transfer by interstate wires to his personal bank account. Thus, by manipulating the Paychex payroll system, ABUSHEERY caused an additional $23, 454 in 2006, $65, 231 in 2007 and $106,000 in 2008, to be deposited into his personal bank accounts.
In a second scheme, involving Carpenter’s petty cash account, ABUSHEERY routinely caused unauthorized checks to be written and negotiated for “petty cash” and then pocketed the cash for himself. Specifically, ABUSHEERY directed Carpenter’s accounts payable clerks to (1) prepare checks drawn on the company’s bank account for his signature; (2) cash the checks after he signed them, and (3) turn over the cash, generally in $100 bills, to him upon their return from the bank. ABUSHEERY then pocketed the money and used it for his own personal expenses. This procedure was followed for 68 ‘extra’ checks and thereby ABUSHEERY stole an additional $264,100 during 2006 to 2008.
ABUSHEERY deposited over $80,000 in cash in his personal bank account and that these deposits generally consisted of $100 dollar bills – the same denomination obtained by the accounts payable clerks when they cashed Carpenter petty cash checks as directed by ABUSHEERY. Often these deposits closely followed in time to ABUSHEERY’s receipt of cash from petty cash checks.
As detailed by the government, ABUSHEERY abused his position of trust vis-a-vis his employer in executing both the payroll fraud and the petty cash fraud in that he had unique access to the Paychex payroll system and authority to approve the addition of petty cash checks to the weekly check run due to his position as controller.
During the calendar years 2006 and 2007, ABUSHEERY willfully made and subscribed U.S. individual tax returns, Forms 1040, knowing that the tax returns did not report the significant amounts of money stolen from Carpenter via the petty cash fraud and certain annual bonuses paid by Carpenter by wire transfer directly to ABUSHEERY’s personal bank account.
ABUSHEERY used the money that he stole from Carpenter to build an addition on his home, install a pool, pool house and putting green, as well as on vacations and a boat. In addition, the prosecutor told the Court that there was more than $180,000 in unaccounted for cash taken by ABUSHEERY in the petty cash scheme.
United States Attorney Carmen M. Ortiz and William Offord, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston made the announcement today. The case was prosecuted by Assistant U.S. Attorney Diane Freniere of Ortiz’s Public Corruption & Special Prosecutions Unit.
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