Wednesday, October 29, 2014

Former Manager of Rhode Island Insurance Company Charged With Embezzling $2.7 Million

From the Dispatch-Argus on 10/28/2014:

A former Rock Island insurance company manager has been federally indicted on fraud and money laundering charges totaling $2.7 million.

Dominic Giovanni Scodeller, 47, of Davenport, was arrested and made an initial appearance in U.S. District Court, Rock Island, on Tuesday, the same day federal records in the case were unsealed. Currently in the custody of federal marshals, he has a detention hearing scheduled this morning before Judge Sara Darrow.

On Oct. 21, a grand jury indicted Mr. Scodeller on 15 counts of fraud by radio, wire or television; money laundering; concealment; and mail fraud.

Mr. Scodeller was manager of purchasing and facilities for Bituminous Insurance Companies headquartered in Rock Island. He authorized BITCO payments to lessors for branch offices throughout the U.S., as well as for upgrades and construction work to its facilities, the indictment states.

Prosecutors allege that, from 2001 through May 2013, Mr. Scodeller developed a plan to defraud BITCO that started before he even was hired with lies about his academic record and lack of a criminal history during his job interview.

The indictment states that, once hired, Mr. Scodeller created "bogus entities" for fake corporations and bribed vendors and suppliers to pay him unauthorized kickbacks in exchange for BITCO business.

Mr. Scodeller allegedly set up mailing addresses and bank accounts for fake corporations -- such as "North Shores Group Properties," "Agility Business Resumption," "Secure Business Systems" and "AmyLyn Properties" -- that purportedly provided facilities and services to  BITCO. He is accused of using the nonexistent entities as false fronts to bill BITCO for facilities and services while disguising his control and interest in the entities.

To convince BITCO the entities were real, Mr. Scodeller allegedly submitted bills for services he claimed the entities provided, then would sign off on the bills and pocket the funds.
With legitimate firms that provided services, Mr. Scodeller allegedly would bill BITCO for an inflated amount under the name of a bogus entity and keep the difference.

The indictment also says Mr. Scodeller engaged in monetary transactions of more than $10,000 "involving property derived from the scheme to defraud BITCO."

After an internal investigation, BITCO turned the matter over to FBI and IRS criminal investigations.
Each count of mail or wire fraud has a maximum penalty of up to 20 years in prison and a $250,000 fine. The money laundering counts are punishable by up to 20 years in prison and a maximum fine of $500,000 or twice the value of property involved in the transactions, whichever amount is greater.

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