FOR FURTHER INFORMATION CONTACT
AUSA VICKIE E. LEDUC or
MARCIA MURPHY at 410-209-4885
JUNE 26, 2007
FOR IMMEDIATE RELEASE
INDICTMENT ALLEGES $12 MILLION CONTRACTING FRAUD SCHEME
Allegedly Laundered $3 Million in Profits Used for Personal Gain;
Understated Over $7 Million in Individual and Corporate Taxes
Baltimore, Maryland - A federal grand jury returned a superseding indictment today charging Georgette A. Richie,49, of Dillwyn, Virginia, (formerly Denton, Maryland) with mail and wire fraud; conspiracy to commit mail and wire fraud and money laundering; money laundering; and filing false tax returns, in connection with an alleged scheme to defraud the company where Ms. Richie’s ex-husband worked of over $12 million, announced United States Attorney for the District of Maryland Rod J. Rosenstein. The original indictment was returned in April 2007 charged mail and wire fraud and money laundering and was sealed.
According to the 24-count indictment, AMPORTS, Inc. operated an import/export car processing service for automobile manufacturers from five locations in this country, including Baltimore. Georgette’s former husband Phillip M. Richie was AMPORTS’ Director of Engineering, responsible for receiving and analyzing bids from contractors for capital expenditures and maintenance of AMPORTS’ facilities. He approved invoices for payment once the contracts were completed. The indictment names Phillip Richie as a co-conspirator although he is not charged; he died in Dillwyn, Virginia in November 2004.
The indictment alleges that Georgette and Phillip Richie created two companies, Webster General, Inc. and Geo Tech Systems, Inc., using the name and social security number of a dead man as the president of both companies, in order to conceal their ownership and control of Webster General and Geo Tech from AMPORTS. From September 2000 to July 2003, Phillip Richie violated AMPORTS’ conflict of interest policies and awarded AMPORTS construction contracts to these companies. Geo Tech and Webster General received over $12 million which they used to pay various subcontractors who performed the actual work, and they pocketed about $3 million in profits. As part of the scheme, Phillip Richie changed the scope of the contract work in discussions with subcontractors to reduce expenses. Phillip and Georgette Richie opened accounts with internet banks for which the purported “president” of Webster General and Geo Tech would not have to appear in person to establish the account. They hired employees for Webster General and Geo Tech to sit in a construction trailer located at AMPORTS in Baltimore to create the appearance that the companies were separate from the Richies. They used fictitious individuals who they pretended were working for Geo Tech for e-mail correspondence and contact with AMPORTS.
In the course of the scheme, the indictment alleges that the Richies laundered about $3 million in profits by funneling the money to personal bank accounts and limited liability corporations they created to conceal the funds. They used the limited liability corporations to invest in real estate on Maryland’s Eastern Shore.
Finally, the indictment charges that for tax years 2001 and 2002, Georgette Richie understated over $1 million in income on her federal individual income tax returns; filed false corporate tax returns for Webster General, understating the company’s gross income by over $2.3 million; filed false corporate tax returns for Geo Tech, understating the company’s gross income by over $3 million; and filed false partnership returns for the limited liability corporations, understating gross income by over $1 million.
The indictment seeks forfeiture of $3 million.
Georgette Richie faces a maximum sentence of 20 years in prison for each of four counts of mail and wire fraud; 5 years in prison for conspiracy; 10 years in prison for each of eight counts of money laundering in amounts greater than $10,000; 20 years in prison for each of two counts of money laundering; and 3 years in prison for each of 9 counts of filing false tax returns.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
United States Attorney Rod J. Rosenstein praised the U.S. Postal Inspection Service and Internal Revenue Service - Criminal Investigation for their investigative work. Mr. Rosenstein thanked Assistant U.S. Attorney Joyce K. McDonald, who is prosecuting the case.