Dennis M. Duffy

Assistant U.S. Attorney, Senior Litigation Counsel

Eastern District of North Carolina

310 New Bern Avenue, Suite 800, Raleigh, NC 27601

919-856-4847 dennis.duffy@usdoj.gov

WHITE COLLAR PROSECUTIONS

September 26, 2012

Association of Credit Union Internal Auditors

1.

Prostitution Financial Fraud

3. 2.

Arson

4.

Burglaries

WHITE COLLAR PROSECUTIONS

White collar crimes cover an incredibly wide spectrum of conduct:

1.

Prostitution

Financial Fraud

3.

2.

Arson

4.

Burglaries

1. Prostitution

Veotis Harding

ITAR and Money Laundering

Veotis Harding

Sherry Westbrook Clarence Saunders

Alfonita Lee Wanda Hall Tiffany Campbell Ruby Williams Lori Barton Lesonja Riddick April Kittrell Jessica White

Brandi Bates Serena Krotzer Renea Hartsock Rhonda Brock Deanna Borrillo

David Taylor Antowain Steward

Organizational Structure for: Diamonds and Pearls Escorts First In Flight Anastasia Escorts

Trash Runs

Credit Card Records

Bank Records

Phone Records

Potential Charges

ITAR § 1952:

1. Use Interstate Facility; and

2. Facilitate Racketeering Enterprise.

MONEY LAUNDERING § 1956:

1. Financial Transaction;

2. Proceeds of Specified Unlawful Activity (“SUA”);

3. Knew Stolen Proceeds; and

4. Knew Transaction Intended, in Whole or in Part, to

Conceal or Promote.

Veotis Harding Sherry Westbrook Clarence Saunders

24 ½ Years 5 Years Probation

January 6, 1998

2. Arson

NOVEMBER 10, 1997

TIMELINE OF EVENTS AFTER FIRE

11/10/97 - 10/13/98

11

/10

/97

11

/14

/97

11

/28

/97

12

/12

/97

12

/21

/97

01

/06

/98

02

/13

/98

03

/25

/98

04

/20

/98

11

/07

/98

10

/13

/98

Fire

UNITY B - 90K

UNITY C - 344K

UNITY A - 75K

Claim Form Sent

5K Check Issued

Wire Fraud

5K Check Issued 5K Check Issued

Letter Re: Advance

10K Check Issued

$7,240 Check Issued

Debris Photo

Hauling Invoice

TIMELINE OF EVENTS LEADING UP TO FIRE

01/01/97 - 11/10/97

01

/01

/97

01

/21

/97

Financial

Statement

Tax Return

Complaint

01

/28

/97

Unity A

02

/07

/97

Centura Complaint

Note

02

/25

/97

02

/27

/97

Unity B

Unity C

03

/21

/97

Note

Extension

03

/25

/97

Extension

Extension

04

/01

/97

Settlement

05

/27

/97

Judgment

Insurance Application

06

/10

/97

08

/21

/97

Increase in

Insurance

• Allen Security

• Scruggs

• C.O.D.

• NC

• Talks to Jones Re: Burning Down Store

• Needs Time to Move Stuff to Warehouse

June - November

• Gives Scales to Brenda

• Moves Trucks

• Moves Profitable Business

to Warehouse

11

/97

11

/03

/97

First Attempt

• Gasoline Smell

• Cigarettes and Meat Gone

11

/07

/97

11

/10

/97

Lori Sees

Jones with

Cigarettes

Nov. 3 - 10

• Defendant Confirms Insurance

• Defendant Refills Cigarettes

Fire

Sum of Debt

Note

Bank Records

Insurance Investigation

Tax Records

Potential

Charges

NOVEMBER 10, 1997

Thomas Patrick McGlon

Defendant

Gary De Bellonia

Clifton C. West

Daniel Watlington

Defendant

William Muwwakkil Rickey Jessie

Advance Fee Scheme And

Counterfeit Checks

3. Financial Fraud

SGI SPORTS Ex. 396

Ex. 130, Page 39

Ex. 403

Ex. 398

6/20/00

Wire to McGlon &

Assoc. - $30,000

4/19/01

Account West Transfers

$6,536 from SGI Sports to

Conifer Economic Group –

Zeros Out SGI Sports

6/09/00

SGI Sports Wires $300,000

to Trust Account Maintained

by West

6/20/00

Wire to Villei Int’l

(McGlon) - $100,000

Ex.

397

Ex. 400

6/20/00

Check to Daniel

Watlington (via Pallie

Trust) - $60,000

Ex.

404

6/30/00

Check to Daniel

Watlington - $1,500

Ex. 407

10/27/00

Wire to Gary De

Bellonia - $1,000

Ex. 408

4/06/01

Wire to Gary De

Bellonia - $5,000

06/30/00

SGI Sports Wires $5,678

to Trust Account

Maintained by West

6/20/00

Wire to Connie

Givens -$7,500 (for

Watlington)

Ex. 399

6/23/00

Wire to Alex Lam

- $5,000 (for

Gary De

Bellonia)

Ex. 402

6/30/00

Wire to Connie Givens

-$500 (for Watlington)

Ex. 405

9/01/00

West Transfers $75,000

from SGI Sports to

Conifer Economic Group

Ex. 409

4/19/01

Check to West -

$3,642

Ex. 406

10/27/00

Wire to Teresa De

Bellonia - $2,000

Ex. 401

6/23/00

Wire to Teresa De

Bellonia - $8,000

Potential Charges

WIRE FRAUD § 1343:

1. Plan to Defraud OR Obtain Money;

2. Knowing Participation;

3. Misrepresentation was Material; and

4. Use of Wire.

BANK FRAUD § 1344:

1. Plan to Defraud OR Obtain Money;

2. Intent to Defraud;

3. Victim was FDIC Insured; and

4. Misrepresentation was Material.

MONEY LAUNDERING § 1956:

1. Financial Transaction;

2. Proceeds of SUA;

3. Knew Stolen Proceeds; and

4. Knew Transaction Intended, in Whole or in Part, to Conceal or

Promote.

SGI SPORTS Ex. 396

Ex. 130, Page 39

Ex. 403

Ex. 398

6/20/00

Wire to McGlon &

Assoc. - $30,000

4/19/01

West Transfers $6,536 from

SGI Sports to Conifer

Economic Group – Zeros

Out SGI Sports Account

6/09/00

SGI Sports Wires $300,000

to Trust Account Maintained

by West

6/20/00

Wire to Villei Int’l

(McGlon) - $100,000

Ex.

397

Ex. 400

6/20/00

Check to Daniel

Watlington (via Pallie

Trust) - $60,000

Ex.

404

6/30/00

Check to Daniel

Watlington - $1,500

Ex. 407

10/27/00

Wire to Gary De

Bellonia - $1,000

Ex. 408

4/06/01

Wire to Gary De

Bellonia - $5,000

06/30/00

SGI Sports Wires $5,678

to Trust Account

Maintained by West

6/20/00

Wire to Connie

Givens -$7,500 (for

Watlington)

Ex. 399

6/23/00

Wire to Alex Lam -

$5,000 (for Gary De

Bellonia)

Ex. 402

6/30/00

Wire to Connie Givens

-$500 (for Watlington)

Ex. 405

9/01/00

West Transfers $75,000

from SGI Sports to

Conifer Economic

Group

Ex. 409

4/19/01

Check to West - $3,642

Ex. 406

10/27/00

Wire to Teresa De

Bellonia - $2,000

Ex. 401

6/23/00

Wire to Teresa De

Bellonia - $8,000

COUNT 8 COUNT 9

COUNT

26

Thomas Patrick McGlon

CONVICTED:

2 Counts Conspiracy

10 Counts Wire Fraud

11 Counts Money Laundering

Gary De Bellonia

PLED GUILTY &

COOPERATED

Clifton C. West

PLED GUILTY &

COOPERATED

Daniel Watlington

CONVICTED:

2 Counts Conspiracy

5 Counts Bank Fraud

11 Counts Wire Fraud

14 Counts Money Laundering

William Muwwakkil

PLED GUILTY

Rickey Jessie

PLED GUILTY &

COOPERATED

EVENTS TIMELINEEVENTS TIMELINE

03/25/9902/18/9912/24/9811/11/98

1998

Charleston TreasuresCharleston, SC

10/07/98 05/21/99 06/17/99 06/18/99

1999

Mark Andrews Jewelers

Cary / Durham, NC

Winn Dixie

Cary / Durham, NC

Winn DixieApex, NC

10/97

1997

Lands JewelersRaleigh, NC

Friedman’s Jewelers

Birmingham, AL

Spartanburg, SCWinn Dixie

Raleigh, NC

Kroger

Macon, GAFriedman’s JewlersFt. Oglethorpe, GA

GOVERNMENT

EXHIBIT

214

5:01-CR-292-3H/4H

Regency JewelersMacon, GA

Hertz Rental Agreement10/21/97

Macon, GA

Hertz Rental Agreement10/26/97

Macon, GA

National Car Rental Agreement12/21097

Macon, GA

Enterprise Car Rental Agreement05/21099

Chapel Hill, NC

SERANO BUYS STOLEN JEWELRY AND

STAMPS FROM GRANIMS / ORNELAS

February$54,500

March$60,000

May$30,000

July300 Bks Stamps

07/99

Pocket Watch Found on E-Bay

4. Interstate Burglary Ring

Events Timeline

MARK ANDREWS JEWELERS WINN DIXIE

Burglary Ring

Events Timeline

GOVERNMENT

EXHIBIT

3

5:01-CR-292-3H/4H

GOVERNMENT

EXHIBIT

4

5:01-CR-292-3H/4H

EVENTS TIMELINEEVENTS TIMELINE

03/25/9902/18/9912/24/9811/11/98

1998

Charleston TreasuresCharleston, SC

10/07/98 05/21/99 06/17/99 06/18/99

1999

Mark Andrews Jewelers

Cary / Durham, NC

Winn Dixie

Cary / Durham, NC

Winn DixieApex, NC

10/97

1997

Lands JewelersRaleigh, NC

Friedman’s Jewelers

Birmingham, AL

Spartanburg, SCWinn Dixie

Raleigh, NC

Kroger

Macon, GAFriedman’s JewlersFt. Oglethorpe, GA

GOVERNMENT

EXHIBIT

214

5:01-CR-292-3H/4H

Regency JewelersMacon, GA

Hertz Rental Agreement10/21/97

Macon, GA

Hertz Rental Agreement10/26/97

Macon, GA

National Car Rental Agreement12/21097

Macon, GA

Enterprise Car Rental Agreement05/21099

Chapel Hill, NC

SERANO BUYS STOLEN JEWELRY AND

STAMPS FROM GRANIMS / ORNELAS

February$54,500

March$60,000

May$30,000

July300 Bks Stamps

07/99

Pocket Watch Found on E-Bay

Serrano Pays Granims and Ornelas

For Jewelry Stolen from Friedmans

in Alabama - $54,500

February 19, 1999

Florida

Serrano Pays Granims and Ornelas For

Jewelry Stolen from Mark Andrews

Jewelers in North Carolina $30,000

May 24, 1999

Florida

Robert Marshall SerranoRonald Jay Myers, Jr.

GOVERNMENT

EXHIBIT

215

5:01-CR-292-3H/4H

William Anthony Granims Michael Clarence Ornelas

John Mark Collins

INTERSTATE TRANSPORTATION OF STOLEN

ITSP

Interstate Travel;

Knows Property Stolen; and

Total Value - $5,000 or More

Aid & Abet

Knew of Crime

Did Act

Intended to Further Crime

PROPERTY (ITSP)

COUNT 1 ITSP Conspiracy

§371

(8/96 – 7/99)

Agreement

Knowingly Joined In; and

An Overt Act in Furtherance

COUNT 2

ITSP / Aiding & Abetting

§2314 & §2

(Mark Andrews: 5/17 - 5/25/99)

COUNT 3 ITSP / Aiding and Abetting

§2314 & §2

(Winn Dixie - Raleigh/Apex

6/14/99 – 7/13/99)

Money Laundering

Financial Transaction;

Proceeds of ITSP;

Knew Stolen Proceeds;

Knew Transaction Intended,

Aid & Abet

Knew of Crime

Did Act

Intended to further crime

MONEY LAUNDERING

COUNT 4 Conspiracy

§1956(h)

(5/20/99 – 5/25/99)

Agreement

Knowingly Joined In; and

An Overt Act in Furtherance

COUNT 5

Money Laundering

And Aiding & Abetting

§1956(a)(1)(B)(i)

(5/24/99 – 5/25/99)

in Whole or in Part, to Conceal

Potential Charges

05/21

MAY 1999

05/24 05/26

Joint American Express

Account: Granims and Collins

Granims’ Personal Checking Account

GOVERNMENT

EXHIBIT

212

5:01-CR-292-3H/4H

Ex 114

Ex 114

Ex 114

Ex. 130, Pg. 025

Ex. 130, Pg. 043

Ex 129, Pgs. 081 & 082 Ex 129, Pgs. 081 & 083 Ex 77

WINN DIXIE

Cary / Durham

Ex 8

MARK ANDREWS

JEWELERS

Ex 1

Ex 79

Ex. 130, Pg. 105 Ex. 130, Pg. 106

Robert Marshall SerranoRonald Jay Myers, Jr.

GOVERNMENT

EXHIBIT

215

5:01-CR-292-3H/4H

William Anthony Granims Michael Clarence Ornelas

John Mark Collins

Serrano

Robert Marshall SerranoRonald Jay Myers, Jr.

GOVERNMENT

EXHIBIT

215

5:01-CR-292-3H/4H

William Anthony Granims Michael Clarence Ornelas

John Mark CollinsCollins

66 Months 54 Months

Robert Marshall SerranoRonald Jay Myers, Jr.

GOVERNMENT

EXHIBIT

215

5:01-CR-292-3H/4H

William Anthony Granims Michael Clarence Ornelas

John Mark Collins

Robert Marshall SerranoRonald Jay Myers, Jr.

GOVERNMENT

EXHIBIT

215

5:01-CR-292-3H/4H

William Anthony Granims Michael Clarence Ornelas

John Mark Collins

Robert Marshall SerranoRonald Jay Myers, Jr.

GOVERNMENT

EXHIBIT

215

5:01-CR-292-3H/4H

William Anthony Granims Michael Clarence Ornelas

John Mark Collins

Pled Guilty Pled Guilty Pled Guilty