Union County, New Jersey, Auto Dealer Admits Laundering Proceeds Of Fraud On Russian Citizens
NEWARK, N.J. – A New Jersey auto dealer today admitted laundering hundreds of thousands of dollars generated by a scheme to defraud Russian citizen of monies, paid in advance, for the purchase of luxury automobiles shipped from the United States, U.S. Attorney Craig Carpenito announced.
Sergey Kapustin, 49, of Warminster, Pennsylvania, pleaded guilty before U.S. District Court Judge Susan D. Wigenton in Newark federal court to an information charging him with one count of money laundering.
According to documents filed in this case and statements made in court:
Kapustin was the owner and president of Global Auto Group, Effect Auto Sales and G Auto Sales, located in Elizabeth, New Jersey. Global bought and sold used cars, typically high-end vehicles that were routinely classified as “salvaged.”
From January 2008 through December 2014, Kapustin defrauded customers, who usually lived in Russia, Ukraine or members of the former Soviet Union. He had at least one Russian language website that offered for sale luxury vehicles that were normally priced below market value and that could be shipped to Finland for easy delivery to Russian citizens, but only if they agreed to pay full price in advance for the vehicle. He admitted that his customers routinely either did not receive the vehicles for which they had wired payment or, alternatively, were shipped vehicles that were either not operable or in poor condition
Once the funds were deposited into one the several bank accounts Kapustin controlled, he would move those funds to other accounts from which he withdrew funds to continue the scheme, as well as for his own personal use. Kapustin admitted laundering as much as $550,000 of customer down payments.
The count to which Kapustin pleaded guilty carries a maximum penalty of 10 years and $250,000 fine. Sentencing is scheduled for July 10, 2018.
U.S. Attorney Carpenito credited the special agents of the FBI, under the direction of Acting Special Agent in Charge Bradley W. Cohen in Newark, and special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen, with the investigation leading to today’s guilty plea.
The government is represented by Senior Litigation Counsel V. Grady O’Malley of the U.S. Attorney’s Office Organized Crime/Gangs Unit.
Defense: Carol Gillen Esq., Assistant Federal Public Defender, Newark