Former California State Assemblyman Pleads Guilty To Money Laundering In Fraud Scheme Involving BART Coffee Shops
OAKLAND – Terrence Patrick Goggin pleaded guilty in federal court in San Francisco today to money laundering, announced United States Attorney David L. Anderson, Federal Bureau of Investigation Special Agent in Charge John F. Bennett, and Internal Revenue Service, Criminal Investigation (IRS-CI), Special Agent in Charge Kareem Carter. The plea was accepted by the Honorable James Donato, U.S. District Judge.
Goggin, 78, of San Francisco, is a former California State Assemblyman and current California-licensed attorney. According to his guilty plea, he admitted that, in 2013 and 2014, he was the founder and CEO of Metropolitan Coffee and Concession Company, LLC (“MC2”). From July 2007 to February 26, 2014, Goggin solicited investor money to build Peet’s Coffee retail centers, including two future centers that he claimed he would build at the Civic Center and Balboa Park BART stations. The investors for the MC2 projects included a group of four private equity investors who provided financing in September 2013 of $585,000 for the Civic Center project and an individual who invested $100,000 in September 2013 for the Balboa Park project. Goggin falsely represented to those investors that their money would be used to build out those specific future Peet’s Coffee retail centers, when, in truth, he planned to use the funds for other purposes. Goggin further admitted that he also failed to provide the investors with accurate information about the relationship between MC2 and BART and about the state of MC2’s finances. In addition, Goggin admitted that in September 2013 he diverted, and directed his employees to divert, nearly all of the $685,000 in investment funds to other business bank accounts associated with business ventures into which the investors had not agreed, or intended, to invest. Among other transfers, on September 12, 2013, the same day MC2 received $585,000 from the private equity investors, Goggin knowingly directed the transfer of $15,000 from the MC2 bank account to the business bank account of Aegis Atlantic LLC, a Delaware company of which Goggin was also CEO. That money was never used for the agreed-upon BART projects and was instead spent on other purposes.
On September 13, 2018, a federal grand jury returned a superseding indictment charging Goggin with four counts of wire fraud, in violation of 18 U.S.C. § 1343, and nine counts of money laundering, in violation of 18 U.S.C. § 1957. Under the plea agreement, Goggin pleaded guilty to one count of money laundering and agreed to pay restitution of at least $685,000.
Goggin remains free on bond, pending sentencing. Judge Donato scheduled Goggin’s sentencing hearing for April 1, 2020. Goggin faces a maximum statutory penalty of ten years in prison and a fine of $250,000, plus restitution, for the money laundering conviction. However, any sentence will 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. Attorney Katherine Lloyd-Lovett is prosecuting the case with the assistance of Rebecca Shelton. The prosecution is the result of an investigation by the FBI and the IRS-CI.