Bankruptcy Fraud Resource Center

Illinois farmer's wife sentenced to probation following guilty plea

Updating a story we reported here, Margaret Diekemper was sentenced to two years of probation and a $500 fine for her role in a bankruptcy fraud scheme in the Southern District of Illinois following a plea agreement reached with the government last November.  Diekemper was also prohibited from any contact with her husband - whose sentencing hearing is scheduled for next month.  Federal prosecutors asked U.S. District Judge G. Patrick Murphy to impose a one year term of imprisonment, citing the defendant's cooperation with the government in their case against her husband.  Judge Murphy imposed probation after remarking that Diekemper's "overbearing, ignorant" husband seemed to bear the most responsibility for their involvement in the bankruptcy fraud scheme. 

Pennsylvania debtors receive 15 day prison sentence for failing to disclose family business

Tammy Beecher and Wyatt Beecher, a Pennsylvania couple, were each sentenced to fifteen days in prison by U.S. Magistrate Judge J. Andrew Smyser in the Middle District of Pennsylvania for contempt of court for untruthful conduct in their joint bankruptcy case.

According to a press release issued by the U.S. Attorney's Office, the Beechers filed a chapter 7 bankrutpcy petition in May 2007.  The filing stated that the Tammy Beecher had no income and that neither debtor had been involved in the operation of a business within the previous six years.  In fact, the Beechers owned a family business, "Fun 4 Kids Entertainment."  Only after the Beecher’s were presented with a coupon for $5 off any party, and reminded by the chapter 7 trustee they signed the bankruptcy petition under penalty of perjury, did the Beecher’s admit that the business had been operated on-and-off for the past three years.

Parmalat founder sentenced following conviction for bankruptcy fraud in Milan

According to this news report, Calisto Tanzi, the founder of Italian food manufacturer Parmalat was sentenced earlier this month in Milan to serve ten years in prison for his criminal role in the firm's well-publicized collapse.  Tanzi was convicted and sentenced on bankruptcy fraud and criminal association charges.  Dubbed "Europe's Enron," the Parmalat collapse resulted in a series of criminal trials including two of Tanzi's adult children (who negotiated lighter prison sentences) and numerous other defendants.  Three employees of Bank of America were acquitted of related charges.  Tanzi is the first Parmalat executive to sentenced to prison.

Florida mortgage fraud scheme ends in eight year prison term

Anthony Dehaney, whose conviction in a multi-million dollar mortgage fraud scheme we previously reported on here, was sentenced today in the Southern District of Florida to eight years in prison.  Dehaney pleaded guilty to conspiracy, mail fraud and making a false declaration in a bankruptcy case last October.  He admitted before sentencing that he began investing in real estate in 2002 when advisors instructed him that nobody would review the details of his mortgage applications.  He also ackowledged lying on numerous loan applications between 2003 and 2006.  When the real estate market turned for the worse, Dehaney filed fraudulent (forged) bankruptcy petitions on behalf of three straw buyers in order to stop pending foreclosure proceedings.

The sentence imposed by U.S. District Judge William Dimitrouleas exceeded prosecutors' recommendations by approximately three years according to published reports.

Probation imposed for couple convicted of concealing income

According to this news report, Juan Tenorio and Charlene Tenorio each were sentenced to terms of probation after a jury in the District of Guam convicted them of concealing nearly $75,000 in income from their engineering firm during their 2002 bankruptcy case.  U.S. District Judge Francis Tydingco-Gatewood sentenced Juan to five years probation, a fine and restitution.  Charlene received a two-year term of probation, a fine and will be required to make restitution as well.  

Plan proponents convicted in Hawaiian Airlines bankruptcy fraud case

William H. Spencer and Paul Boghosian were convicted on numerous federal charges relating to their fraudulent conduct in proposing a reorganization plan in the 2003 Hawaiian Airlines bankruptcy case.  Spencer was convicted following a two-week jury trial in Manhattan.  Boghosian pleaded guilty on October 29th.

According to trial evidence, in connection with a bankruptcy court's consideration of two competing reorganization plans, one backed by Hawaiian Investment Partners Group LLC ("HIP Plan") and another jointly backed by the trustee and Hawaiian Holdings Inc., Spencer submitted false affidavits to the bankruptcy court claiming he could provide between $300 and $500 million to fund the HIP Plan through a trust that he controlled. He later submitted a supplemental affidavit, with attached purported bank records, in which he represented that the trust had agreed to commit $500 million to fund the HIP Plan, and that the money was being held in a Netherlands bank account.  Both defendants also gave false deposition testimony and used the false affidavits to solicit interested parties to support the HIP Plan.

As it turned out, the funds did not exist and the documents submitted to the bankruptcy court were completely fraudulent.

Sentencing is scheduled for January 30, 2009 

Farmer pleads guilty; denies involvement in deaths of potential witnesses

As expected, Joey Diekemper has reached a plea agreement with the government and pleaded guilty to conspiracy to commit bankruptcy fraud in Illinois bankruptcy fraud case with ties to a double homocide of two potential witnesses.  Diekemper entered a guilty plea on Wednesday before U.S. Magistrate Judge Clifford Proud.  Outside of court, Diekemper's attorney denied his client had any involvement with the deaths of neighbors who owned the property on which a tractor Diekemper was charged with concealing was allegedly stashed.  Sentencing is scheduled for March 9.  Diekemper's wife, who previously pleaded guilty to conspiring with her husband to conceal assets in their bankruptcy case, will be sentenced on the same date.

Farmer's wife guilty of conspiring to conceal assets

Margaret Diekemper pleaded guilty in the Southern District of Illinois to conspiring with her husband, Joseph "Joey" Diekemper, to conceal assets in their bankruptcy case.  Twenty-two other felony counts will be dismissed as part of plea bargain.  The couple was indicted in June on numerous bankruptcy felony counts inlcuding concealing assets in their multi-million dollar bankruptcy case.  Joseph is incarcerated while awaiting trial on the bankruptcy fraud charges pending against him because a judge revoked his bond for weapons violations.

In a seperate investigation related to the same case, authorities are also investigating the deaths of two potential witnesses found shot to death on property where the couple allegedly hid a tractor they were charged with concealing.  According to news reports citing an FBI memo, the killings came only days after one of the victims approached the FBI about the tractor and told investigators that he was worried that Joseph would burn down his house.  Firefighters found the bodies while responding to a fire at the victims' home.

Margaret is scheduled to be sentenced on February 9th.

New Jersey man convicted and sentenced for lying in bankruptcy case about closed bank accounts

Updating a case we reported on earlier (here) Moty Rosenkrantz a/k/a Michael Rosenkrantz, the owner of B&W Motor Cars, pled guilty to structuring banking transactions to avoid reporting requirements and making a false oath in a bankruptcy case.  The defendant admitted in his guilty plea that in July 2003 he filed a bankruptcy petition in which he falsely reported that no financial accounts in his name had been closed in the preceding year when in fact he had closed at least 7 bank accounts in March 2003.

Rosenkrantz was sentenced in the District of New Jersey to 48 months in prison, three years of supervised release and a fine of $10,000.

Gary Peel sentenced on bankruptcy bribery charges; files 7th Circuit appeal

We have a (belated) update regarding Illinois attorney Gary Peel who was convicted on bankruptcy bribery, obstruction of justice and child pornography charges in a case whose background is discussed here and here. 

Since we last reported, Judge Stiehl denied Peel's motion for a new trial and sentenced him to 37 years of imprisonment, a $1,000 fine and three years of supervised release.  Peel will serve only 12 years because the sentences will run concurrently.  Not suprisingly, Peel has appealed his conviction and sentence to the U.S. Court of Appeals for the Seventh Circuit.