Massachusetts Man Sentenced To 24 Months In Federal Prison On Money Laundering, Gambling And Tax Violations
CONCORD – John Giannelli, Sr., 66, of Danvers, Massachusetts, was sentenced to 24 months in federal prison today after pleading guilty on September 27, 2012 in the United States District Court for the District of New Hampshire to one count of money laundering, one count of operating an illegal gambling business, and five counts of impeding the administration of the Internal Revenue laws, announced United States Attorney John P. Kacavas.
Giannelli operated a computer based sports betting business while he resided in Peabody, Massachusetts and then Kingston, New Hampshire. Giannelli controlled access, through the use of user identifications and passwords, to a gambling site and granted access to that site to dozens of agents. Approximately 300 customers making sports related wagers were able to gain access to the site through the agents and Giannelli was able to monitor the overall betting activity. A forensic analysis of betting records obtained from computers seized at Giannelli’s residence in March 2012 established that the operation generated gross profits of approximately $188,000 over a twelve week period.
The money laundering charges arose from a scheme in which Giannelli was listed as an employee on a former sports betting customer’s business. Giannelli provided the business with cash proceeds generated by the gambling business and, in return, the business issued paychecks to Giannelli, thus making it appear that Giannelli’s income was legitimate. The business also caused to be generated false W-2 forms that Giannelli used to support tax returns filed with the IRS. Between 2003 and 2007, Giannelli laundered approximately $452,000 in proceeds through the scheme. The District Court ordered a money judgment forfeiture in the amount of $452,000.
The investigation was conducted by the Federal Bureau of Investigation and the Internal Revenue Service.