Frederick Couple Plead Guilty to Fraudulently Obtaining Over $700,000 in Advanced Fees
Promised a 100% Money Back Guarantee of Fees Advanced to Obtain Grant Money
Baltimore, Maryland - Rosa Lee Brown, age 53, and Allen Abraham McMillan, age 57, both formerly of Frederick, Maryland, pleaded guilty today to conspiracy to commit mail fraud arising out of a fraudulent scheme to obtain advance fees for purported grant-writing services.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Postal Inspector in Charge Gary R. Barksdale of the U.S. Postal Inspection Service - Washington Division.
“Financial fraud causes tremendous turmoil for thousands of citizens; both in our community and across our country,” said Gary R. Barksdale, Postal Inspector in Charge of the Washington Division. “Today’s plea shows Postal Inspectors’ commitment to keep U.S. Mail safe from fraudulent activities and sends a clear message that mail fraud will not be tolerated.”
According to their plea agreements, Brown was the CEO and McMillan was the CFO of Grants Made Easy, a company they established to purportedly assist in obtaining government, non-profit and corporate grant money. From December 2006 to August 2008, the defendants marketed Grants Made Easy by speaking at business and real estate seminars in Maryland and around the country. Brown, the primary speaker at these events, portrayed Grants Made Easy and herself as experienced in grant-writing, with a proven track record of having obtained over $60 million in grants for her clients. Brown stated that Grants Made Easy would shepherd the clients through the entire process of identifying potential sources of funding, writing the application and securing the funding. As part of the pitch, Grants Made Easy provided false testimonials from supposedly satisfied customers, including a business associated with Brown’s daughter.
Grants Made Easy required its clients to sign a contract and provide an advance fee ranging from $1,000 to over $100,000. Clients typically mailed their contracts back to Brown and McMillan and paid by cashier’s check, check or wire transfer. Grants Made Easy promised a 100% money back guarantee.
Brown was the keynote speaker at a business seminar in Solomon’s Island, Maryland in June 2007. Afterwards, three members of a family involved in real estate development sent $76,500 for an “expedited grant.” McMillan provided a letter to the family purporting to show that they were approved for $10 million in grant funding. Like other victims, they received only an extended runaround and endless promises of when their funding would be coming though.
Eventually, some of the victims contacted law enforcement. The ensuing investigation identified over 30 people who had paid for grant-writing services, none of which had received a grant. Moreover, there was no evidence that Brown or McMillan had done anything to identify or secure any grants, beyond depositing the advance fees.
The total loss incurred during the course of the scheme was $724,250.
Both defendants face a maximum sentence of 20 years in prison and a fine of up to twice the gross gain or loss occasioned by their conduct. U.S. District Judge James K. Bredar scheduled their sentencing for June 25, 2013.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
United States Attorney Rod J. Rosenstein praised the U.S. Postal Inspection Service for its work in the investigation and thanked Assistant U.S. Attorney Barbara S. Sale, who is prosecuting the case.