FORMER CHIEF INFORMATION OFFICER SENTENCED TO PRISON FOR EMBEZZLING MORE THAN $500,000 FROM EMPLOYER
Defendant had Embezzled from Two Prior Employers
DALE N. FRANTZ, 46, of Gig Harbor, Washington, was sentenced today in U.S. District Court in Tacoma to 71 months in prison, three years of supervised release and $516,358 in restitution for wire fraud. FRANTZ is the former Chief Information Officer at Auto Warehousing Company (AWC), a Tacoma company that is the largest full service automobile processor in the United States. After FRANTZ was convicted of embezzling from a prior employer in Indiana, he convinced AWC to take a chance on him, claiming that he was a changed man. Instead, FRANTZ hatched a scheme in which he stole over half a million dollars from AWC. At sentencing, U.S. District Judge Robert J. Bryan said, “This was not just a serious offense, it was a series of serious offenses.”
According to records filed in the case, an AWC audit revealed that between 2007 and 2009, FRANTZ obtained more than $500,000 in fraudulent reimbursements from the company. FRANTZ submitted phony invoices and other fake supporting documentation falsely claiming reimbursement for goods and services that never were provided to AWC. He also altered legitimate invoices to falsely inflate the price, and sought reimbursement for the higher amount. FRANTZ also purchased computer equipment with company money and sold the equipment on the internet or gave it to friends or family members. FRANTZ also directed a co-conspirator to establish a shell company in Florida. FRANTZ submitted fake invoices from the shell company to AWC for reimbursement for goods and services that the shell company never provided. FRANTZ then split the proceeds with the co-conspirator.
FRANTZ joined AWC in 1998. He had worked his way up to being Chief Information Officer, with a handsome salary and more than a dozen people reporting to him. When AWC confronted FRANTZ about the audit, he tried to convince them not to file charges. The company reported the theft to law enforcement.
FRANTZ had embezzled from his two previous employers. In 1991, he was fired from Great Lakes Chemical in Indiana, after using the company ordering system to buy computer equipment that he used or sold for his own profit. His next stop was Pro Audio in Indiana. As an office manager, FRANTZ failed to deposit much of the daily income from the shop, and used it for his own benefit. The precise amount stolen is not known, but FRANTZ deposited $200,000 in his bank account over 18 months, while making a salary of only $32,000 per year. In 1996, FRANTZ was sentenced to four years in prison for that theft. He joined AWC after being released from prison.
In asking for a significant prison term, Assistant United States Attorney Thomas Woods noted that FRANTZ’ prior prison stint had not deterred him from more crime. FRANTZ “was a respected member of the company’s senior leadership. His career was thriving. His motivation was pure greed. .... It is apparent that Frantz suffers from a lack of moral direction. He does not appreciate the consequences of his wrongful acts,” Mr. Woods wrote in his sentencing memo.
The case was investigated by the U.S. Secret Service.
The case was prosecuted by Assistant United States Attorney Thomas Woods.
For additional information please contact Emily Langlie, Public Affairs Officer for the United States Attorney’s Office, at (206) 553-4110 or Emily.Langlie@USDOJ.Gov.