Former CEO of Texas beverage company sentenced to 10 years in prison for fraud
Targeted News Service (Press Releases)
The former CEO of a Texas beverage company was sentenced today to ten years in prison for his role in a high-yield investment scheme in which he and his co-conspirators fraudulently sold more than $12 million of stock in Dallas-based EarthWater Limited to elderly and other vulnerable victims. Four other individuals have also been sentenced to prison for their roles in the scheme.
According to court documents, Cengiz Jan "CJ" Comu, 62, of Dallas, formerly EarthWater's Chief Executive Officer; John Mervyn Price, 67, of Dallas, formerly EarthWater's Chief Operating Officer; Richard Laurence Kadish, 61, of Del Ray Beach, Florida; Richard Lawrence Green, 71, of Deerfield Beach, Florida; and Suzanne Aileen Gagnier, 68, of Huntington Beach, California, and others conspired to defraud victims and made false representations about how EarthWater would use investors' money.
Comu, Price, Kadish, Green, Gagnier, and their co-conspirators falsely represented that more than 90% of money raised from investors would be re-invested in the company, when in fact a substantial majority of the funds were used for the conspirators' personal benefit.
Comu pleaded guilty to 23 counts including conspiracy to commit mail fraud and wire fraud, mail fraud, wire fraud, and money laundering. Price pleaded guilty to 22 counts including conspiracy to commit mail fraud and wire fraud, mail fraud, wire fraud, and money laundering, and was sentenced to six years in prison. Kadish and Green each pleaded guilty to one count of conspiracy to commit mail fraud and wire fraud and one count of mail fraud and were each sentenced to six years in prison. Gagnier pleaded guilty to one count of conspiracy to commit mail and wire fraud and was sentenced to two years in prison.
Six other defendants charged in the scheme have also pleaded guilty and are awaiting sentencing: Harley E. "Buddy" Barnes, III, 64, formerly of Plano, Texas, formerly EarthWater's Chief Financial Officer; Russell Filippo, 72, of Oklahoma City; Daniel Thomas Broyles Sr., 65, formerly of Malibu, California; Joe Edward Duchinsky, 67, of Norwalk, California; Joseph Lucien Duplain, 81, of Murrieta, California; and Donald Andrew Rothman, 75, of Coral Springs, Florida. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department's Criminal Division; U.S. Attorney Leigha Simonton for the Northern District of Texas; and Inspector in Charge Eric Shen of the U.S. Postal Inspection Service's Criminal Investigations Group made the announcement.
The U.S. Postal Inspection Service investigated the case.
Trial Attorneys Christopher Fenton and Theodore M. Kneller of the Criminal Division's Fraud Section and Assistant U.S. Attorneys Mary F. Walters and Beverly Chapman of the Northern District of Texas are prosecuting the case.
The department's extensive and broad-based efforts to combat elder fraud seek to halt the widespread losses seniors suffer from fraud schemes. The best method for prevention, however, is by sharing information about the various types of elder fraud schemes with relatives, friends, neighbors, and other seniors who can use that information to protect themselves.
If you or someone you know is age 60 or older and has been a victim of financial fraud, help is available at the National Elder Fraud Hotline: 1-833-FRAUD-11 (1-833-372-8311). This Department of Justice hotline, managed by the Office for Victims of Crime, is staffed by experienced professionals who provide personalized support to callers by assessing the needs of the victim and identifying relevant next steps. Case managers will identify appropriate reporting agencies, provide information to callers to assist them in reporting, connect callers directly with appropriate agencies, and provide resources and referrals, on a case-by-case basis. Reporting is the first step. Reporting can help authorities identify those who commit fraud and reporting certain financial losses due to fraud as soon as possible can increase the likelihood of recovering losses. The hotline is staffed seven days a week from 6:00 a.m. to 11:00 p.m. ET. English, Spanish, and other languages are available.
* * *
Original text here: https://www.justice.gov/usao-ndtx/pr/former-ceo-texas-beverage-company-sentenced-10-years-prison-fraudulent-scheme