Former President of MGM Grand Pleads Guilty to Violating the Bank Secrecy Act for Allowing Man Involved in Criminal Conduct to Gamble
LOS ANGELES – A La Crescenta man was sentenced today to nine years in federal prison after pleading guilty to federal fraud charges stemming from two schemes – one that bilked a string of payroll companies, and a second involving fraudulent bills sent to entities ranging from small businesses to local school districts that never received any services.
David William Bell, 55, received the 108-month sentenced from United States District Judge Virginia A. Phillips, who additionally ordered Bell to pay just over $1 million in restitution to payroll companies, hundreds of small businesses and other entities.
Bell was sentenced after he pleaded guilty in August to one count of wire fraud and one count of mail fraud.
Bell ran a company called UST Development, Inc. – which operated in Ontario and Pomona under a string of names, including US Telecom – that he used to defraud a host of victims through two separate schemes. Bell used different titles while at UST, including president, director and CEO.
In the first scheme, which ran from 2008 through 2010, Bell convinced a series of third-party payroll companies to fund UST’s payroll – and then failed to reimburse the companies for paying himself and his employees. In some cases, Bell sent checks to the payroll companies from accounts that did not have sufficient funds to cover the checks.
Over the two-year period, Bell retained or attempted to retain companies that included Paychex, Ceridian and Automated Data Processing (ADP), according to a plea agreement filed in this case. Prosecutors said in court documents that, in a few instances, Bell repaid a fraction of what UST received from the payroll companies. “After filing for bankruptcy, and changing his company name, he started a new scheme,” according to a sentencing memorandum filed with the court.
In the second scheme, which related to the mail fraud charge, Bell and his employees sent out mailers that fraudulently appeared to be bills to thousands of small businesses and other entities, most of which were located across Southern California. The mailers – which were sent through the end of 2011 and used words like “invoice,” “statement” and “past due” – told recipients that they owed UST $175 or $350 for “Telecom Maintenance/Service Call.” Many victims paid UST based on the fraudulent claims, when in reality they did not owe UST any money.
Bell “is a fraudster, a trickster. He deceives people into giving him money or services. He has done this for a long time,” according to the sentencing memorandum.
The case against Bell was investigated by the United States Postal Inspection Service and the Federal Bureau of Investigation.
This case was prosecuted by Assistant United States Attorneys Sean D. Peterson and Abigail W. Evans of the Riverside Branch Office.
Spokesperson/Public Affairs Officer
United States Attorney’s Office
Central District of California (Los Angeles)