United States Attorney Rebecca A. Gregory
Eastern District of Texas
FOR IMMEDIATE RELEASE CONTACT: DAVILYN WALSTON
MONDAY, JANUARY 5, 2009 PUBLIC INFORMATION OFFICER
WWW.USDOJ.GOV/USAO/txe PHONE: (409) 839-2538 CELL: (409) 553-9881
PORT ARTHUR BUSINESSMAN GUILTY OF HURRICANE FRAUD
BEAUMONT TX – United States Attorney Rebecca A. Gregory announced that a 43-year-old Port Arthur businessman has pleaded guilty to hurricane related fraud in the Eastern District of Texas.
LOC CHANH TRAN, a/k/a VICTOR TRAN was indicted by a federal grand jury on June 4, 2008, and charged with making a false statement to the Small Business Administration (SBA) in connection with an application he filed on behalf of Titan Seafood Corporation for federal disaster assistance. Tran pleaded guilty to those charges today before United States Magistrate Judge Earl S. Hines.
According to information presented in court, on Jan. 19, 2006, Tran submitted a disaster loan application to the SBA on behalf of Titan Seafood. In the application, Tran represented that Titan Seafood had an additional business location in Abbeville, LA, that had sustained damage from Hurricane Rita totaling $2.8 million. To support the claim, Tran submitted a fraudulent commercial lease agreement and fraudulent invoices for repairs for the Abbeville property. However, neither Tran, nor Titan Seafood in Port Arthur, held any legal interest in the Abbeville property.
Further investigation revealed that although Tran's application was eventually denied by the SBA, he conducted similar schemes during this time which resulted in the receipt of more than $1 million from the Port Arthur Economic Development Corporation and the XL Lloyds Insurance Corporation.
Tran faces up to five years in federal prison, a fine of up to $250,000.00, and restitution to the Port Arthur Economic Development Corporation in the amount of $500,000.00 and to the XL Lloyds Insurance Company in the amount of $542,389.00. A sentencing date has not been set.
In September 2005, the U.S. Department of Justice created the Hurricane Katrina Fraud Task Force, designed to deter, investigate and prosecute disaster-related federal crimes such as charity fraud, identity theft, procurement fraud and insurance fraud. The Hurricane Katrina Fraud Task Force – chaired by Assistant Attorney General Alice S. Fisher of the Criminal Division – includes members of the FBI, the Federal Trade Commission, the U.S. Postal Inspection Service, and the Executive Office for United States Attorneys, among others.
This case is being investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Small Business Administration and the Department of Homeland Security - Office of Inspector General. The case is being prosecuted by Assistant United States Attorney John Ross.
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