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Insurance Broker and Former Toms River Mayor Sentenced in Separate Schemes Involving Toms River Officials
U.S. Attorney's OfficeJanuary 6, 2014
District of New Jersey (973) 645-2888
TRENTON, NJ--A New Jersey insurance broker and the former mayor of Toms River, New Jersey, were each sentenced today for offenses arising from separate schemes involving officials of Toms River and the former insurance broker for the Toms River Regional School District Francis X. Gartland, U.S. Attorney Paul J. Fishman announced.
Frank Cotroneo, 63, of Chester, New Jersey, an insurance broker with an office in Morristown, New Jersey, was sentenced to 37 months in prison and ordered to pay more than $12.4 million in restitution to the Toms River School District and in forfeiture to the United States. Cotroneo previously pleaded guilty before former Chief U.S. District Judge Garrett E. Brown, Jr. to one count each of bribery and tax evasion arising from his participation in a scheme to pay hundreds of thousands of dollars in bribes to Michael J. Ritacco, 67, of Seaside Park, New Jersey, the former superintendent for the Toms River Regional School District, in exchange for his official assistance.
Carmine C. Inteso, Jr., 47, of Toms River, was sentenced today to six months in prison and six months of house arrest for evading his income tax obligations. Inteso, who was arrested in July 2012 after returning from Afghanistan where he had been working as a contractor, pleaded guilty in December 2012 before U.S. District Judge Joel A. Pisano to one count of tax evasion.
From 2002 through 2007, Inteso held the positions of Township Committee member, mayor, deputy mayor, and councilman for the Township of Toms River, formerly known as Dover Township.
Inteso allegedly took a job in Afghanistan after learning he was the target of the tax investigation and, after returning to the United States, was taken into custody at New York'sJohn F. Kennedy International airport.
Judge Pisano imposed the sentences today in Trenton federal court.
According to documents filed and statements made in court:
Cotroneo admitted that from 2002 to April 2009, he and co-conspirators Gartland and Frank D'Alonzo, a former administrator at the Toms River Regional School District, paid bribes and other benefits to Michael J. Ritacco, who was then the superintendent of the district. The payments were made to allow Cotroneo and Gartland, 72, of Baltimore, Maryland--insurance co-brokers for the school district--to obtain and keep the lucrative insurance brokerage contracts with the district. To facilitate the scheme, Ritacco, Gartland, and Cotroneo agreed to have Ritacco approve a workers' compensation insurance contract between Gartland and the school district, which yielded between $500,000 and $600,000 annually in excess fees. Those proceeds were to be used to make hundreds of thousands of dollars in bribes to Ritacco.
Cotroneo also admitted that for tax years 2005 to 2007, he evaded the assessment of hundreds of thousands of dollars of federal income taxes by concealing the illegal proceeds he received from Gartland and others during the course of the bribery scheme.
Ritacco and Gartland were ordered previously to pay $4,336, 987.91 in restitution to the school district. Judge Pisano today ordered Cotroneo to pay $3,275,677.65 in restitution, which represented the loss to the school district while he was an active participant in the scheme. In addition to ordering restitution, the court ordered that Cotroneo forfeit to the United States a sum of $9,126,200.16, which represented the proceeds derived from the scheme. D'Alonzo was ordered to pay $1,625,952.79 in restitution and also ordered to forfeit a sum of approximately $4.3 million. Gartland was previously ordered to forfeit $11 million, which represented the total proceeds derived from the fraudulent scheme. Prior to his sentencing on September 14, 2012, Ritacco forfeited to the United States$1 million, a 2010 Mercedes Benz, and $8,950 in cash.
In addition to the prison term and payments, Judge Pisano sentenced Cotroneo to serve three years of supervised release.
In a separate and unrelated scheme beginning in 2005 and continuing through 2008, Inteso accepted hundreds of thousands of dollars in payments from Gartland, an insurance broker whose companies provided insurance brokerage services for New Jersey municipal entities including the Brick Township Board of Education and the Township of Toms River. Inteso directed Gartland to make the payments to a company Inteso controlled and that had ceased operating by 2007. Gartland pleaded guilty to charges of mail fraud, conspiracy to defraud the IRS, and perjury and was sentenced to 135 months in prison.
Inteso used the funds to pay for his personal expenses and withdrew significant amounts of cash. Despite receiving approximately $291,000 in income from the insurance broker during calendar years 2006, 2007 and 2008, Inteso failed to file personal income taxes for those years.
In addition to the prison term, Judge Pisano sentenced Inteso to serve two years of supervised release.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford; and IRS-Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen. The Office of International Affairs in the Justice Department's Criminal Division and the Diplomatic Security Service's Regional Security Office in Kabul, Afghanistan, provided invaluable assistance in the Inteso case.
The government is represented by Assistant U.S. Attorney Lee M. Cortes, Jr. of the U.S. Attorney's Office Special Prosecutions Division in Newark.