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Press Release

Two Men Sentenced to Prison Terms in $1 Million ‘Upfront-Fee’ Scheme

For Immediate Release
U.S. Attorney's Office, District of New Jersey

NEWARK, N.J. – A Camden County, New Jersey, man and a Nevada man were sentenced to prison terms for their roles in defrauding multiple victims through a $1 million “upfront-fee” scheme, U.S. Attorney Philip R. Sellinger announced today.

Roy Johannes Gillar, 51, of Las Vegas, was sentenced to six years in prison; Harold Mignott, 60, of Voorhees, New Jersey, was sentenced to three years in prison. They were each convicted on Oct. 21, 2022, of wire fraud conspiracy and four counts of wire fraud following a five-week jury trial before U.S. District Judge John Michael Vazquez. Gillar was also convicted of one count of transacting in criminal proceeds. Judge Vazquez imposed the sentences on June 22, 2023, in Newark federal court. A co-defendant, Jerrid Douglas of Freehold, New Jersey, who was also convicted, is scheduled to be sentenced on July 26, 2023.

According to documents in this case and evidence at trial:

From March 2016 through June 2016, Douglas, Gillar, and Mignott, along with a fourth conspirator, agreed to defraud the owners of the victim company of approximately $1 million. The defendants fraudulently induced the two victim company owners to enter a joint venture agreement with the defendants’ New Jersey-based shell company. The defendants falsely represented that their company could acquire and provide a “standby letter of credit” (SBLC) backed by either €1 billion in cash or highly lucrative Mexican gold bonds. An SBLC is a guarantee of payment issued by a bank on behalf of a client that is used should the client fail to fulfill a contractual commitment with a third party.

The victim company wanted access to the standby letter of credit so it could purchase raw gold overseas and sell it to gold refineries. As part of the joint venture agreement, the company agreed to pay the defendants $1 million for the bank fee associated with the standby letter of credit.

In order to cover up the scheme and convince the victims to approve the transfer of the funds, the defendants made numerous verbal and written misrepresentations, including providing the victims with a phony letter from a major international bank saying that it was ready, willing, and able to provide a €1 billion SBLC to the defendants’ shell company.

However, after the victim company owners transmitted $800,000 of the $1 million to the defendants, the defendants failed to provide an SBLC or anything of value. Instead, the defendants misappropriated the money for their personal use.

In addition to the prison terms, Judge Vazquez sentenced Gillar to three years of supervised release and ordered to pay restitution of $1.1 million and forfeiture of $1 million. Mignott was sentenced to three years of supervised release and ordered to pay restitution of $1.1 million and forfeiture of $219,000.

U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark, with the investigation leading to the sentencing.

The government is represented by Assistant U.S. Attorneys Jason S. Gould and Joshua L. Haber of the U.S. Attorney’s Office Criminal Division in Newark.

Updated June 23, 2023

Financial Fraud
Press Release Number: 23-185