Fraud committed in Indiana too.
AB Wire
Norman D’Souza, the former chief financial officer and vice president of finance of a New Jersey-based furniture wholesaler and retailer and an Indiana-based furniture manufacturer affiliated with it, has pleaded guilty to participating in a fraudulent scheme to obtain $17 million in loans from a commercial bank based in New York, and $1 million in municipal loans from Gas City, Indiana, by making false statements and providing false and fraudulent documents concerning the Companies’ financial condition.
D’Souza pled guilty before U.S. District Judge Ronnie Abrams, on Friday.
U.S. Attorney Preet Bharara said in a statement: “Norman D’Souza repeatedly misrepresented the financial condition of two companies to deceive a bank and a municipality into lending the companies $18 million dollars, which was never repaid. Together with our partners at the FBI, we will continue to aggressively pursue accounting frauds like this one, which caused millions of dollars in losses.”
According to the allegations, from in or about 2011 until in or about September 2014, the company in New Jersey, through D’Souza and others fraudulently induced the Bank into lending it millions of dollars by repeatedly making false and misleading statements about its financial condition.
D’Souza falsely inflated its sales and accounts receivable on “borrowing base certificates” and in financial statements that he provided to the bank pursuant to loan agreements. He used those falsely inflated sales and accounts receivable to mislead the bank about the company’s true financial performance, which enabled it to secure and draw down a $17 million revolving credit facility from the bank.
The company ultimately defaulted on the loans issued by the bank in September 2014. At that time, the outstanding balance of the loans was approximately $16.99 million.
Separately, in 2012, the city offered loans and other financial incentives to the Indiana company in return for agreement to operate a furniture factory in the city and employ local residents. Among other things, D’Souza falsely inflated that company’s sales figures in financial statements provided to the city. The company ultimately defaulted on the loans issued by the city in September 2014. At that time, the outstanding balance of the loans was $1 million.
D’Souza, 50, of Monmouth Junction, New Jersey, pled guilty to one count of conspiracy to commit bank fraud, which carries a maximum sentence of 30 years in prison, and one count of conspiracy to commit wire fraud, which carries a maximum sentence of 20 years in prison. D’Souza is scheduled to be sentenced on July 22, 2016, before Judge Abrams.
1 Comment
I dont get this kind of crap. This guy just works for the guy who benefited. he probably was told “do it or your fired”. the real criminal here is munir hussain who owned the business. gee i wonder where the money went… M Design Villiage and oxford baby again selling to BabiesRUs and Burlington. Fool me once shame on you fool me twice shame on me. this guy should be the one going to jail ! and the real people who suffered were the employees in indiana where he ripped off the city