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Justice News

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

Monday, October 16, 2017

Medina man sentenced to nearly seven years in prison for stealing from construction company

A Medina man was sentenced to nearly seven years in prison for stealing $245,000 from his employer and using the money to pay for a country club membership, vehicles and purchases at Victoria’s Secret and GNC, law enforcement officials said.

Brian K. Stepp, 51, previously pleaded guilty to two counts of conspiracy to commit wire fraud, two counts of wire fraud and one count of making false statements on loan application.

“This defendant is a serial fraudster who caused a business to close and 80 employees to lose their jobs,” U.S. Attorney Justin E. Herdman said. “He used this company’s coffers as his own personal bank.”

“Mr. Stepp conspired in a variety of fraudulent financial schemes to steal money for car and country club membership purchases and exorbitant retail purchases,” said Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland office. “The FBI will continue to root out financial fraudsters and hold them accountable for their criminal actions.”

Stepp worked at Variety Contractors, Inc., a company based in Medina County that provided general contracting services for large public and commercial retail construction projects in Ohio and other states.

Stepp joined the company as vice president with the plan to eventually buy the company. He served as acting president but never purchased the company, according to court documents and statements

Stepp incorporated S&S Kelsey LN, a shell company that did not engage in any actual business. He submitted a variety of fake invoices from S&S and other vendors to Variety Contractors of goods and services that were not provided. Stepp caused Variety Contractors to make payments on those fraudulent invoices, according to court documents.

For example, in September 2014, a check request for $31,500 was made for payment to G.C.I. for “Deposit for Exterior Metal Panels”. Three days later, a check in the same amount made payable to Ganley, which Stepp used to partially pay for a 2015 Chevy Silverado pickup truck that he purchased in his wife’s name, according to court documents.

Stepp also fraudulently used a company credit card to pay for personal expenses, such as membership and related fees at Weymouth Country Club, payments made to purchase vehicles to himself and his family, local hotel charges, legal fees, and charges at stores including Victoria’s Secret and GNC, according to court documents.

The loss to Variety Contractors was $245,120. The company went out of business in 2015 and approximately 80 employees lost their jobs, according to court documents and statements

Stepp also made numerous false statements in attempting to get several loans, according court documents.

Stepp, while on supervised release, also hired someone to break the jaws of two people who had been critical of him, according to court documents.

U.S. District Judge Chirstopher Boyko sentenced Stepp to six years in prison for fraud, to be followed by six months for violating the terms of his supervised release in hiring someone to assault others.

This case is being prosecuted by Assistant U.S. Attorneys Rebecca Lutzko and Ranya Elzein following an investigation by the Federal Bureau of Investigation.

Financial Fraud
Mike Tobin 216.622.3651
Updated October 16, 2017