New jersey business owner charged with operating corporate ponzi scheme resulting in more than $42 million in losses
FOR IMMEDIATE RELEASE
May 28, 2014
NEWARK, N.J. – The owner of a group of freight payment, logistics, and shipping businesses headquartered in Branchburg, N.J., surrendered today to face charges she operated them as a multimillion-dollar Ponzi scheme, U.S. Attorney Paul J. Fishman announced.
Shirley Sooy, 63, currently of Fort Smith, Ark., surrendered in Newark this afternoon to inspectors of the U.S. Postal Inspection Service and special agents of IRS-Criminal Investigation on a criminal complaint charging her with wire fraud conspiracy, wire fraud, mail fraud, and transacting in criminal proceeds. She is scheduled for an initial appearance and bail hearing this afternoon before U.S. Magistrate Judge James B. Clark III in Newark federal court.
According to the complaint unsealed today:
From 2003 through April 2013, Sooy, through a collection of businesses operating under the umbrella of the “TransVantage Group,” entered contracts with corporate clients – referred to in the complaint as the “victim companies.” TransVantage audited freight bills generated by common carriers and freight forwarders hired by the victim companies. TransVantage was obligated to pay the audited and approved freight bills to the carriers from funds provided by those companies, and the funds were supposed to be held in trust by TransVantage until paid over to the carriers. The victim companies also paid TransVantage for its purported auditing services, payments separate and apart from the carrier payment funds.
Sooy allegedly operated TransVantage as a Ponzi scheme, which resulted in more than $42 million in losses to the victim companies. Sooy and others comingled the funds from the victim companies – funds that were to have been paid to carriers – into two accounts and then misused those funds in various ways. They paid prior, unpaid carrier bills of particular victim companies using funds provided by other, unrelated victim companies; they funded TransVantage’s payroll obligations and they funded the obligations of various TransVantage subsidiaries.
They also subsidized millions of dollars in personal expenses, including mortgage payments for personal properties owned by Sooy and others in Bloomsbury, N.J.; Phillipsburg, N.J.; Waretown, N.J.; and Palm Beach Gardens, Fla.; a 48-foot yacht purchased by Sooy with others; a $135,000 Maserati automobile purchased by a conspirator; payments for personal credit card charges incurred by Sooy and her family members; and payments for remodeling Sooy’s home.
The counts of wire fraud conspiracy, wire fraud, and mail fraud with which Sooy is charged each carry a maximum potential penalty of 20 years in prison and a fine of up to $250,000, or twice the gain or loss from the offense. The counts of transacting in criminal proceeds with which Sooy is charged each carry a maximum potential penalty of 10 years in prison and a fine of $250,000, or twice the gain or loss from the offense.
U.S. Attorney Fishman credited postal inspectors of the U.S. Postal Inspection Service, under the direction of Postal Inspector in Charge Maria L. Kelokates; and special agents of IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Jonathan D. Larsen, for the investigation leading to today’s charges.
The government is represented by Assistant U.S. Attorneys Zach Intrater and Shirley U. Emehelu of the U.S. Attorney’s Office Economic Crimes Unit in Newark.
The charge and allegations contained in the complaint are merely accusations, and the defendant is considered innocent unless and until proven guilty.
Today’s arrest 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. attorney’s 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.