Mississippi man and Destrehan man sentenced for bank fraud, wire fraud and money laundering conspiracies


Date: March 29, 2024

Contact: newsroom@ci.irs.gov

NEW ORLEANS — Ryan P. Mullen and a resident of Jayess, MS., and Duane A. Dufrene of Destrehan, LA., were sentenced on March 20, 2024, and March 27, 2024, respectively by U.S. District Judge Jane Triche Milazzo for two separate cases involving conspiracy to commit bank fraud, conspiracy to commit wire fraud, and conspiracy to commit money laundering, announced U.S. Attorney Duane A. Evans. Judge Milazzo sentenced Mullen to 160 months' imprisonment for both cases and she sentenced Dufrene to 24 months imprisonment for the same two cases.

According to court documents, Mullen and Dufrene used fictitious entities, falsified tax returns, fraudulent financial statements, and fraudulent appraisals to defraud the lending institutions so that Mullen and Dufrene could purchase a residence in Jayess, MS. (using a state bank in Mississippi), The Briars bed and breakfast in Natchez, MS. (using a Mississippi credit union) and two other Natchez hotels (using an out of state commercial lender). The sale of the Jayess, MS. residence was premised on false financial information provided by Dufrene to Mullen, who then gave it to the Mississippi bank. The sales of The Briars and the two hotels were premised upon not only false information prepared by DUFRENE and given to the financial institutions by Mullen, but also on inflated appraisals stemming from side sales agreements between Mullen and Dufrene. After the sales of the bed and breakfast and hotel properties, Mullen paid DUFRENE $90,000. Mullen used the proceeds to buy at least 20, some already governmentally seized, high-end luxury cars, a number of which have been seized. The loss from their fraudulent purchasing and flipping schemes totals approximately $6.5 million.

In the second fraud scheme, Mullen conspired with Dufrene, Dillon Arceneaux, Lance Vallo, Grant Menard, and Zeb Sartin to use several shell Louisiana corporations, devoid of assets, to defraud a Georgia based merchant cash company. Mullen and Dufrene helped establish Arceneaux, Vallo, Menard, and Sartin as the owners of the existing shell corporations. Mullen and Dufrene then created fake vendor accounts for the corporations, and Mullen, along with another person, created falsified bank records for the companies. Mullen then used an alias and represented himself to be a broker for the shell companies he helped create.

Through the aid of another broker, Mullen supplied the victim merchant cash advance company with the fake vendor accounts and false bank records in order to obtain funding. The victim cash advance company approved the advances and began to electronically wire Arceneaux, Vallo, Menard, and Sartin millions of dollars in advances. Mullen, Arceneaux, Vallo, Menard, and Sartin conspired to launder a portion of the funds by paying Dufrene a fee for preparing the fake vendor contracts. Arceneaux, Vallo, Menard, and Sartin then closed their non-existent businesses before fully repaying the victim merchant cash advance company, resulting in overall losses to the victim of approximately $6.4 million. Mullen again used criminally derived proceeds to purchase a number of high-end vehicles, that he stored at his home in Jayess, Mississippi.

In addition to incarceration, Judge Milazzo ordered Mullen to serve 3 years of supervised release and pay $6,401,385.96 in restitution for one case. She also ordered that restitution in the other case, would be determined at a future restitution hearing. In addition to incarceration, Judge Milazzo also ordered that Dufrene serve 3 years of supervised release and pay $6,401,385.96 in restitution. Each defendant was also ordered to pay a mandatory special assessment fee of $200.

“The crimes committed by the two defendants lost legitimate lenders’ money by receiving loans for fraudulently overvalued properties and nonexistent businesses,” said Lisa Fontanette, Assistant Special Agent in Charge, IRS Criminal Investigation (CI), Atlanta Field Office. “CI special agents and their law enforcement partners will continue to investigate and bring to justice those who engage in financial fraud schemes.”

U.S. Attorney Evans commended the IRS Criminal Investigation and Federal Bureau of Investigation, for their handling of the matter. The case is being prosecuted by Assistant United States Attorneys Edward J. Rivera of the Financial Crimes Unit and Andre J. Lagarde of the Public Integrity Unit.

CI is the criminal investigative arm of the IRS, responsible for conducting financial crime investigations, including tax fraud, narcotics trafficking, money-laundering, public corruption, healthcare fraud, identity theft and more. CI special agents are the only federal law enforcement agents with investigative jurisdiction over violations of the Internal Revenue Code, obtaining a more than a 90 percent federal conviction rate. The agency has 20 field offices located across the U.S. and 12 attaché posts abroad.