Home Improvement Contractor Charged With Defrauding Customers And Hiding Assets from Creditors in Bankruptcy Proceedings
Defendant Also Accused of Defrauding Government Program for Needy Families
WASHINGTON - Michael Lawrence Rosebar, 53, of Washington, D.C., has been indicted on charges alleging that he defrauded customers of his home improvement business and personal creditors, as well as on charges alleging that he made false statements in proceedings in the U.S. Bankruptcy Court, U.S. Attorney Channing D. Phillips announced today. Rosebar also is accused of defrauding government programs that aid unemployed people and needy families.
A grand jury returned a 45-count superseding indictment on June 9, 2016, in the U.S. District Court for the District of Columbia. The superseding indictment includes a total of 26 bankruptcy-related charges first filed against him in an indictment in February 2016, and adds 19 new charges related to the bankruptcy proceedings and two other alleged fraud schemes.
Rosebar is charged with 32 federal counts, including 26 counts of concealment of bankruptcy assets; two counts of making false declarations in bankruptcy; one count of making a false oath or account in bankruptcy; and three counts of wire fraud. He additionally is charged with 13 counts of violating District of Columbia laws, including two counts of conspiracy to commit first-degree fraud and 11 counts of first-degree fraud. The indictment also seeks forfeiture of a money judgment representing all proceeds of any criminal acts outlined in the federal charges.
Rosebar, who pleaded not guilty to charges in the first indictment, is to be arraigned on the new charges on June 22, 2016, by the Honorable Senior Judge Thomas F. Hogan.
“As alleged in the indictment, this home improvement contractor made false statements in bankruptcy proceedings, defrauded clients and creditors, and cheated government programs,” said U.S. Attorney Phillips. “The prosecution of this case reflects our broader determination to protect consumers and government programs from fraud.”
According to the indictment, Rosebar operated businesses under several names, including EMR Construction Contractors. From at least February 2008 through January 2015, the indictment alleges, Rosebar misrepresented himself to clients as a licensed home-improvement, electrical and heating/ventilation/air conditioning (HVAC) contractor. However, at no time during that period did Rosebar have a business or professional license from the District of Columbia Department of Consumer and Regulatory Affairs.
Rosebar recruited customers at home improvement stores, through referrals, and by acting as a sub-contractor on projects. According to the indictment, he negotiated contracts with customers for substantial home improvement or HVAC projects, which he did not intend to complete. He required an initial payment prior to starting work, hired unskilled day laborers or family members for the projects, and then abandoned job sites after doing minimal or otherwise insufficient work, the indictment alleges. The indictment includes charges related to 10 such projects, in which clients paid over $500,000, from 2008 through 2014.
In addition, according to the indictment, Rosebar filed three times for bankruptcy in the period between 2008 and 2013. The first case was dismissed within two months of its filing. The second case ran from 2008 through its dismissal in 2011. The third case was filed in 2013.
The indictment alleges that, in one of his bankruptcies, Rosebar concealed from his creditors nearly $300,000 of earnings generated between 2008 and 2010. In another of the bankruptcy cases, according to the indictment, he made false declarations about his earnings in court filings and at a meeting of creditors. All told, according to the indictment, since 2008, Rosebar has taken in around $800,000, mostly from home-improvement clients, without paying his creditors, and without disclosing the bulk of these earnings properly in bankruptcy.
The indictment also accuses Rosebar of receiving benefits to which he was not entitled from the District of Columbia’s Department of Human Services. From 2010 until 2014, according to the indictment, Rosebar received benefits through the Temporary Assistance for Needy Families program and Supplemental Nutrition Assistance Program after falsely reporting that he had no income, was unemployed, and had no assets other than his family home.
An indictment is merely a formal charge that a defendant has committed a violation of criminal laws and every defendant is presumed innocent until, and unless, proven guilty.
In announcing the indictment, U.S. Attorney Phillips commended the work of Assistant U.S. Attorney John Marston, who is prosecuting the case. He also commended the efforts of Criminal Investigator Stephen Cohen of the U.S. Attorney’s Office, who investigated the case, as well as Paralegal Specialists Jessica Mundi and John Lowell, Assistant U.S. Attorney Arvind K. Lal, Chief of the Office’s Asset Forfeiture and Money Laundering Section, and Assistant U.S. Attorney Philip A. Selden, now with the U.S. Attorney’s Office for the District of Maryland. Finally, U.S. Attorney Phillips expressed appreciation for the assistance provided by the Metropolitan Police Department and the District of Columbia Office of the Inspector General.