Six convicted and sentenced in massive contracting fraud and money laundering scheme

 

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Date: January 15, 2021

Contact: newsroom@ci.irs.gov

Indianapolis — Ernie Perkins of Zionsville, and the owner of Remarkable Creative Enterprises ("RCE"), was sentenced to 70 months imprisonment in connection with his role in a massive, years-long fraud conspiracy that resulted in the theft of more than $8.4 million from a Pennsylvania based bank and a Pennsylvania based insurance company. Neither the bank nor the insurance company are being named because they are victims in this case.

"The license to run a business is not permission to use trusted business partners as an endless stream of free money," said Acting Special Agent in Charge Tamera Cantu, of IRS Criminal Investigation, Chicago Field Office. "John Williams and his accomplices used their positions and access to the banking system to steal over $8 million from multiple businesses, as well as the honest, hardworking Americans who pay their tax obligations. The IRS is committed to aggressively investigating those individuals who engage in tax evasion, money laundering, and financial fraud. Working with our partners at the Department of Justice, we will continue to investigate those who violate the tax laws," said Cantu.

The sentence, handed down by U.S. District Court Judge Sara Evans Barker on January 5, 2021, marks the culmination of a years-long investigation led by agents of the Internal Revenue Service Criminal Investigation, U.S. Postal Inspection Service, Federal Bureau of Investigation and the United States Attorney's Office. This significant investigative effort also yielded convictions and significant federal prison sentences for 5 other defendants. All were convicted of various charges related to the scheme, including theft by a bank employee, money laundering, mail fraud and tax evasion. At a series of hearings held late last year, Judge Barker sentenced the other defendants to significant prison terms for their respective roles in the schemes.

John L. Williams of Zionsville, a former employee of the victim bank, 108 months imprisonment.

Robert Finch of Indianapolis, owner of Finch Constructors and Finch Management, 48 months imprisonment.

Donald Landis of Plainfield, owner of P&L Supply, 36 months imprisonment.

Walter Watson of Detroit, Michigan, owner of W-3 construction company, 18 months imprisonment.

Shalonda Coleman of Indianapolis, a former employee of the insurance company, 24 months imprisonment.

"White collar criminals are thieves who steal through position and influence," said Childress. "White collar crime like tax evasion and money laundering ultimately effects all Hoosiers and this office is committed to aggressively prosecuting these fraudsters."

As outlined in the lengthy indictment, Williams was employed as a construction project manager in the Indianapolis regional office of the victim bank. His responsibilities included overseeing the bank's internal real estate projects in Wisconsin, Illinois, Michigan, Kentucky and Indiana, including new bank branch construction and existing bank branch renovation projects.

In carrying out the scheme, Williams would use information available to him as a bank employee to identify construction and renovation projects that were projected to come in under budget. Williams would then contact Perkins, Finch, Watson, and Landis and instruct them to submit fraudulent invoices on those under-budget projects for work that was never performed and materials that were never supplied. Williams used his position at the bank and his oversight of the projects in question to approve payment of the fraudulent invoices. Once the bank paid the invoices, Perkins, Finch, Watson, and Landis would kick back a large percentage of the money to CB Consulting, a fictitious business entity controlled by Williams.

In many cases, the money passed through multiple bank accounts before reaching the bank account Williams set up for CB Consulting. Between November of 2009 and August of 2016, the defendants were responsible for submitting hundreds of fraudulent invoices to the victim bank and receiving and laundering more than $8.4 million in proceeds from the fraudulent scheme.

Coleman and Perkins are also charged with using the U.S. Mail in a separate scheme to defraud a Pennsylvania-based insurance company and steal money. In those instances, Coleman used her position as a claims processor, and her access to the company's computer systems, to cause the insurance company to mail checks to RCE. Coleman disguised the payments to RCE as payments for work performed for the company's insurance clients, but no work was ever performed. Instead, Perkins would deposit the checks into RCE accounts and kick back a percentage of the money to Coleman.

Williams, Perkins, Finch, Landis and Watson were all convicted of theft and conspiring to launder the money stolen from the bank. Williams and Finch were separately convicted of engaging in a significant number of financial transactions in excess of $10,000 using the stolen funds. Those transactions included transfers to other bank accounts held by the defendants, including the bank accounts of Finch's construction company, the construction of a residence for Williams' family in Zionsville, Indiana, more than $100,000 in payments for a lavish wedding for Williams' daughter, and the purchase of multiple automobiles. Williams and Colman were also convicted of tax evasion and filing false tax returns, respectively, for failing to report their receipt of stolen funds as income on their tax returns.

"Even if you use sophisticated means to steal millions of dollars, you are still a thief, and this sentence sends a clear message of the consequences of such greed," said FBI Indianapolis Special Agent in Charge Paul Keenan. "The FBI will continue to work with the IRS and other law enforcement partners to focus our efforts on these white collar criminals and ensure they are brought to justice."

Bryan Musgrove, Acting Inspector in Charge of the U.S. Postal Inspection Service's Detroit Division stated, "This investigation was an excellent example of a partnership between federal law enforcement agencies and the Southern District of Indiana U.S. Attorney's Office. Together these partners brought down a complex, large-scale fraud conspiracy. I fully commend the hard work and countless hours put forth by all of the law enforcement agencies involved. As a result of their hard work, six defendants in this case were brought to justice."

According to Assistant United States Attorney Matthew J. Rinka, who prosecuted this case for the government, the defendants were also ordered to pay millions of dollars in restitution and all six defendants were ordered to serve a term of federal supervised release upon release from their term of imprisonment.

In November of 2020, Acting United States Attorney John E. Childress renewed a Strategic Plan designed to shape and strengthen the District's response to its most significant public safety challenges. This prosecution demonstrates the Office's enduring commitment to investigating and prosecuting those who engage in fraud and money laundering.