Newport News Man Sentenced to 105 Months for Fraud, Money Laundering, And Felon-In-Possession Convictions
NORFOLK, Va. – James Allen Sutton, 33, of Newport News, Va., was sentenced yesterday to 105 months in prison followed by 3 years of supervised release, for his role in a conspiracy to defraud the United States, money laundering, and illegally possessing a firearm as a felon.
Dana J. Boente, Acting United States Attorney for the Eastern District of Virginia, Thomas J. Kelly, Special Agent of the Internal Revenue Service Criminal Investigations Division,Washington D.C. Field Office, and Daniel Woloszynowski, Resident Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives, Norfolk Field Office, made the announcement after sentencing by Chief U.S. District Judge Rebecca Beach Smith.
Sutton previously pleaded guilty on June 10, 2013. According to court documents, in April of 2011, the Newport News Police Department received a crime stoppers tip reporting that Sutton, a convicted felon, was distributing illegal drugs. Following the tip, detectives with the Newport News Police Department executed a search warrant on Sutton’s residence. Inside Sutton’s apartment, the officers found four pounds of marijuana, a handgun, digital scales and packaging materials commonly used in the sale of marijuana.
The investigation determined that from 2006 through 2010, Sutton conspired with a Hampton business owner, Eleanor Murphy, to disguise the proceeds of his marijuana distribution business as legitimate earnings from Murphy’s construction business, Poor Boy’s Construction.
Sutton needed someone to legitimize his lifestyle, and he needed to show legitimate income in order to file tax returns, obtain mortgage loans and qualify for credit cards. Murphy, who was convicted in 2012 for her role in the conspiracy, provided Sutton with false form 1099s representing income that she never paid to Sutton. Sutton used these 1099s when he filed his own individual income tax returns, in effect, masking the drug money as legitimate income.
An in-depth financial investigation showed that Sutton used the proceeds from his drug business to make hundreds of thousands of dollars’ worth of expenditures related to travel, gambling, and the purchase of expensive clothing, jewelry and automobiles.
This case was investigated by the Internal Revenue Service, Criminal Investigation, the Bureau of Alcohol, Tobacco, Firearms, and Explosives, and the Newport News Police Department. Managing Assistant United States Attorney Howard Zlotnick prosecuted the case on behalf of the United States.A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.