FOR IMMEDIATE RELEASE:
Thursday - October 7, 2004
RALEIGH - United States Attorney Frank D. Whitney announced that STANLEY H. VAN ETTEN, 42, of Millbrook Road, Raleigh, N. C., and Bridgestone Drive, Orlando, Florida, was indicted by a federal grand jury in Raleigh on Thursday, October 7, 2004, for offenses related to a failed real estate transaction and related insurance fraud in the Spring of 2002. Charges in the indictment include conspiracy, as well as wire and mail fraud, relating to submitting false statements to mortgage loan and insurance companies as part of a scheme to fraudulently finance a real estate "flip transaction."
The indictment includes the following factual allegations: STANLEY H. VAN ETTEN submitted false and fraudulent financial information in order to acquire a home at 1705 Snow Wind Court in Raleigh, N. C., and to immediately sell the property to a third party buyer in a transaction otherwise known as a "land flip." The specific objects of the conspiracy were: (1) to fraudulently obtain money, to be used as a down payment, by deceiving Erie Insurance Company into permitting a loan against an insurance policy pledged in a trust; (2) to fraudulently submit loan information in order to deceive SouthStar Funding, Atlanta, Georgia, as to the creditworthiness of STANLEY H. VAN ETTEN for a real estate loan; and (3) to fraudulently submit loan information in order to deceive Fremont Investment, Tampa, Florida, as to the creditworthiness of a third party buyer for a real estate loan.
VAN ETTEN, who was the former Chief Executive Officer, President, and founding Director of International Heritage Inc. (IHI), a Raleigh based multi-level marketing company, currently is awaiting trial in a separate case. A superseding federal indictment filed in March, 2003, charged VAN ETTEN and others with conspiracy to commit mail fraud, wire fraud, securities fraud, and to make false statements to an agency of the United States; six counts of wire fraud; two counts of securities fraud; conspiracy to commit money laundering; 48 counts of money laundering; obstruction of justice; and subornation of perjury.
According to the indictment and court records in that case, IHI was incorporated in North Carolina in April 1995 by STANLEY H. VAN ETTEN and others as a multi-level marketing company purportedly offering exclusive brands of jewelry, recreational equipment, and fine unique collectibles. By July 1997, IHI had accumulated losses of approximately $7.6 million and was financially incapable of fulfilling its commitments to its vendors or to its representatives. By December 1997, IHI'slosses had grown to over $12 million. IHI accumulated operating losses in the approximate amount of $30 million during the 3-year period from April 1995 through November 1998. On November 25, 1998, IHI filed for Chapter 7 bankruptcy protection in the Eastern District of North Carolina.
Investigation of the case was conducted by the Federal Bureau of Investigation and the Internal Revenue Service - Criminal Investigation Division. Assistant U. S. Attorneys J. Gaston B. Williams and Clay C. Wheeler are prosecuting the case for the United States.
News releases are available on the U. S. Attorney's web page atwww.usdoj.gov/usao/nce within 48 hours of release.