Recently in Money-laundering Category

Georgia Man Indicted in Nashville for Investment Fraud and Money Laundering

According to an FBI press release, Rajesh Patel, a 55 year old man from Duluth, Georgia, was recently indicted on several counts of fraud and money laundering.


Mr. Patel's alleged scheme sought $500,000 from an investor to purchase a hotel. Mr. Patel later approached the same investor for $750,000 to purchase a beachfront hotel. The investor was told that the $750,000 would grant him a 25% interest in ownership of the hotel. Mr. Patel is accused of altering the partnership agreement by removing the investor's name from the documents, and for using the funds collected from the investor on Mr. Patel's unrelated personal expenses. Following the indictment, Mr. Patel pled not guilty.

Mr. Patel's indictment alleges five counts of wire fraud, four counts of money laundering, and one count of mail fraud. Each count of fraud carries a sentence of up to 20 years in prison. Each count of money laundering carries a sentence of up to ten years in prison. Also, if convicted, fines may be issued as well as the repossession of any assets obtained as a result of the alleged offenses.


Tennessee Businessman Sentenced to 31 Years in Prison for Fraud

August 30, 2013, by The McKellar Law Firm, PLLC

Former Nashville, Tennessee area business owner, Richard Olive, 49, of Vero Beach, Florida, was convicted on charges of mail fraud, wire fraud, and money laundering by federal jury on March 7, 2013. Olive was ordered to serve 31 years in prison and to pay $5,992,181.24 in restitution to approximately 190 victims for crimes related to his operation of National Foundation of America (NFOA), headquartered in Franklin, Tennessee.

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According to a press release from the U.S. Attorney's Office, from January 2006 through May 2007, Olive represented that NFOA was a charitable organization. He stated multiple times to potential investors that NFOA was recognized by the IRS as a 501(c)(3) organization, even though he only donated approximately $108,000 to charity. That amount is less that ½ of 1% of the $23.6 million NFOA received. Olive continued to state this though he was counseled to cease at least twice by his attorney. Olive obtained assets of over $30 million during the time of operation, promising that in exchange for an "installment bargain contract," NFOA would provide a "guaranteed payout over a guaranteed period of time," as well as a "generous tax deduction." Evidence revealed at the trial showed that NFOA lacked the assets to meet these promises.

Later discoveries in the investigation showed that Olive solicited assets that included annuities, which have high penalties upon their surrender. Once Olive possessed the annuities, he promptly surrendered them to access the cash, incurring more penalties. With this cash, he began living a lavish lifestyle. Olive paid $153,000 on his personal credit card, funded a private jet for a family vacation to New Orleans, settled a lawsuit filed against him for $250,000, and purchased several properties, including a $690,000 condominium in Las Vegas.

Evidence at trial demonstrated that Olive deliberately misrepresented information pertaining to NFOA. In February 2006, merely days after NFOA gained its incorporation, Olive consulted a financial advisor and provided the advisor with fabricated financial statements that stated NFOA held substantial assets and had been operation in both 2003 and 2004. Three months later, he consulted with another financial advisor stating that the company had $35 million worth in assets. However, since its creation till June 2006, the charitable tax returns filed with the State of Tennessee, NFOA had only received $2.8 million in revenue. Olive was also served with a cease-and-desist order from five different states when they detected a misrepresentation of the company as an IRS recognized 501(c)(3) charitable organization. In May 2007, NFOA was seized and liquidated by the Tennessee Department of Commerce and Insurance.

Due to Olive's leadership in this sophisticated scheme, the large amount of money taken from numerous defenseless victims, and the misrepresentation of NFOA being a charitable organization, the District Court concluded additional sentencing enhancements were to be applied.

Tennessee Woman Pleads Guilty to Possession of Counterfeit Securities and Money Laundering

November 17, 2011, by The McKellar Law Firm, PLLC

An Eastern Tennessee woman has pled guilty to one count of possession of counterfeit securities and one count of money laundering in the U.S. District Court of Eastern Tennessee.


Joan Black of Maynardville, Tennessee admitted before a judge that in 2007 she began soliciting investors to purchase annuities through her company, Benefit Capital, Inc. Part of her solicitation consisted of promising the investors that an insurance company in Galveston, Texas guaranteed to pay an annual interest rate of 10% on the annuities. In reality, Ms. Black created fake portfolios by printing the name and logo of the Galveston insurance company at a print shop in Knoxville. The insurance company had no knowledge that their name and logo were being fraudulently used.

Within one year, she was paid over $673,500 by at least five different investors. Instead of investing those funds, Joan deposited that money into her bank account for her own personal use. Her activity was discovered after an investigation was conducted by both the U.S. Postal Inspection Service and the IRS Criminal Investigation. Her sentencing has been set for January 2012.

Pursuant to 18 U.S.C. § 513(a), a person who "makes, utters or possess a counterfeited security of a state or a political subdivision thereof or of an organization, or whoever makes, utters, or possesses a forged security of a state or political subdivision thereof or of an organization, with intent to deceive another person, organization, or government" can be found guilty of possession of counterfeit securities. If a person is found to be guilty of such a crime, they can either be fined, imprisoned up to 10 years, or both.

Under subsection (b) of the same United States Code, a person can also be fined and/or imprisoned up to 10 years if they have either made, received, possessed, sold, or "otherwise transfer[red] an implement designed for or particularly suited for making a counterfeit or forged security with the intent that it be so used."

2 Maryville Tennessee Pain Clinic Operators Indicted

December 15, 2010, by The McKellar Law Firm, PLLC

The federal government is continuing its crackdown on doctors and operators of pain clinics, with the most recent example being the arrest yesterday of five operators and employees of two Maryville, Tennessee pain clinics. The defendants were charged with conspiracy to distribute controlled substances, conspiracy to commit money laundering and structuring cash transactions to avoid federal transaction reporting requirements, according to the U.S. Attorney's Office for the Eastern District of Tennessee.


Each defendant faces a potential term of imprisonment of up to 20 years in prison. They also face fines and forfeiture damages in excess of $1 million and criminal forfeiture as alleged in the indictments.

The U.S. Attorney's Office says that the indictment is the result of a 13-month investigation by the Fifth Judicial Drug Task Force, a Drug Enforcement Administration Task Force, and the Internal Revenue Service-Criminal Investigations (IRS-CI).

People who are unfamiliar with health care fraud cases may be surprised to see that the Internal Revenue Service is involved in the investigation. However, it is more of the rule than the exception to have the IRS involved due to the likelihood of failure to report income and violation of tax structuring laws. Christopher R. Pikelis, Special Agent in Charge of the IRS-CI in Nashville, Tennessee says, "The Internal Revenue Service plays a very unique role in this fight, focusing on the illegal financial activities of the individuals and entities involved with these criminal acts. We are committed to investigating financial fraud and taking away the profits from, and assets used to commit, these crimes."

My advice to anyone running a pain clinic and fearing a possible government investigation is to contact an experienced health care fraud lawyer immediately. As this case illustrates, the Government had been investigating this matter for over a year before any arrest had been made. Having a defense team protecting your rights throughout the investigation is critical and may ultimately determine your chances of successfully defending any charges that may be brought against you.

Additional Resources
Press Release, "Operators and Employees of Two Maryville Pain Clinics Arrested," U.S. Attorney's Office, December 14, 2010