Lexington Man Sentenced To 27 Months For Mail Fraud And Money Laundering Conspiracy
LEXINGTON, KY - A Lexington, Ky., man, who previously admitted conspiring to defraud wireless telephone companies out of hundreds of smartphones, has been sentenced to 27 months in prison.
On Wednesday, U.S. District Judge Joseph M. Hood sentenced 56-year-old Michael Whiteside for conspiring with others to commit mail fraud and to launder the proceeds of his scheme.
Whiteside admitted that he participated in a conspiracy to defraud Verizon Wireless, and other wireless telephone companies, by using false pretenses to buy numerous smartphones, such as iPhones and Samsung Galaxies, at the discounted contract rates. Whiteside recruited and induced other individuals to buy smartphones and sign service contracts when, in fact, these individuals had no intention of honoring their contracts and paying monthly data services fees to the telephone companies. After the purchases, Whiteside took possession of the fraudulently obtained smartphones and shipped them overseas for resale, at substantially higher prices.
Whiteside’s spouse, Julia Whiteside, has also been convicted and sentenced for her role in the conspiracy. Whiteside’s son, Marques Whiteside, has pleaded guilty to mail fraud and money laundering conspiracies and is scheduled to be sentenced on January 5, 2015.
Kerry B. Harvey, U.S. Attorney for the Eastern District of Kentucky, and Paul R. Johnson, Special Agent in Charge, U.S. Secret Service, jointly announced the sentence.
The investigation was conducted by the Lexington Police Department and the U.S. Secret Service. Assistant U.S. Attorney Andrew T. Boone is prosecuting this case on behalf of the federal government.