2002-06-12 -- Zappulla, Vincent -- Guilty Plea -- News Release

North Bergen Official Admits to Fraud Scheme

NEWARK - A North Bergen public official admitted to participating in a scheme to defraud an insurance company, U.S. Attorney Christopher J. Christie announced.

Vincent Zappulla, 67, pleaded guilty today to a one-count Information before U.S. District Judge Alfred M. Wolin.

When he is sentenced by Judge Wolin, Zappulla faces a maximum of 5 years in prison and a $250,000 fine, according to Assistant U.S. Attorney Jeffrey Clark. Judge Wolin set sentencing for October 7, 2002.

Under U.S. Sentencing Guidelines, Judge Wolin will determine Zappulla's actual sentence based on a formula that takes into account the severity and characteristics of the offense and Zappulla's criminal history, if any, Christie said.

Parole has been abolished in the federal system. Under Sentencing Guidelines, defendants who are given custodial terms must serve nearly all that time.

Zappulla admitted that he participated in a fraud in connection with insurance claims related to a fire at a family-owned business in North Bergen. After a 1996 fire at Laundry Time, Inc., a coin operated laundromat, Zappulla caused fraudulent documentation to be submitted to the Laundry Time's insurance company, State Farm Insurance Company. According to the Information, Zappulla caused an estimate for the cost of equipment repair that was inflated by $4,000 to be submitted to State Farm and received reimbursement based on that estimate.

At Zappulla's direction, the contractor who rebuilt the Laundry Time building after the fire, who had substantial contracts with the Township of North Bergen, created a false letter-receipt stating that the contractor had been paid $52,385 for renovating the building, when, in fact, the contractor had been paid substantially less than that. Based on the submission of the false letter-receipt to the insurance company, Laundry Time received a payment of approximately $8,200 to which it otherwise would not have been entitled.

According to the Information, Zappulla was able to obtain the contractor's assistance in the fraud scheme because of his position as a North Bergen public official, where the contractor had numerous contracts.

Christie credited Special Agents of the FBI Newark in Newark, under the direction of Special Agent in Charge for their work in developing the case.

The Government is represented by Assistant U.S. Attorney Jeffrey D. Clark, Deputy Chief of the U.S. Attorney's Criminal Division in Newark.

Defense Attorney: Samuel De Luca and George Tate, Esqs. Jersey City