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Justice News

Department of Justice
U.S. Attorney’s Office
Northern District of California

Thursday, January 26, 2017

Bay Area Resident Pleads Guilty To Concealing Assets In A Bankruptcy Proceeding

Defendant admits failing to disclose five bank accounts when seeking relief from the bankruptcy court for $1.5 million in debts

SAN JOSE – Steve McVay pleaded guilty to concealing assets in a bankruptcy proceeding announced United States Attorney Brian J. Stretch and Federal Bureau of Investigation Special Agent in Charge John F. Bennett. The plea was accepted yesterday by the Honorable Lucy H. Koh, United States District Judge.

According to the plea agreement, McVay, 68, whose last known address was in Morgan Hill, Calif., admitted he filed a voluntary petition for bankruptcy in the United States Bankruptcy Court for the Northern District of California, on February 9, 2010, through which he sought relief for approximately $1.5 million in debts.  McVay acknowledged that in connection with the petition, he signed documents under penalty of perjury that he knew contained false and fraudulent information.  Further, McVay acknowledged he signed the documents with the intent to hide assets from his creditors, the United States Trustee, the court, and other persons charged with control or custody of the bankruptcy estate.  Information about the false and fraudulent information in McVay’s bankruptcy filings is contained in the plea agreement.  For example, as part of the agreement McVay admitted that prior to filing for bankruptcy, he had opened a bank account in his wife’s name, without either her knowledge or consent, and that he had been using the account to receive and transmit monies under his exclusive control; McVay further admitted he failed to disclose the account in his bankruptcy filings.  Further, McVay admitted he knowingly concealed multiple additional bank accounts that he was required to disclose as part of his filings.

McVay was indicted on April 28, 2016, and charged with two counts of concealing assets in bankruptcy proceedings, in violation of 18 U.S.C. § 152(1), and one count of false testimony in bankruptcy proceedings, in violation of 18 U.S.C. § 152(2).  Pursuant to his plea agreement, McVay pleaded guilty to one count of concealing assets in bankruptcy proceedings.

McVay is scheduled to appear before Judge Koh for sentencing on May 17, 2017.  The maximum statutory penalty for a violation of 18 U.S.C. § 152(1) is five years in prison and $250,000 or twice the amount of gain or loss resulting from the scheme.  In addition, a term of supervised release and restitution may be imposed. However, any sentence following conviction would be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.

Assistant U.S. Timothy J. Lucey is prosecuting the case with the assistance of Laurie Worthen.  The prosecution is the result of an investigation by the FBI.

Financial Fraud
Updated January 27, 2017