IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MONTANA BUTTE DIVISION CR 10-1(P

Transcription

1 Case 2:10-cr DWM Document 1 Filed 07/23/10 Page 1 of 15 RYAN M. ARCHER Assistant U.S. Attorney U.S. Attorney's Office P.O. Box 1478 Billings, MT Third Ave. North, Suite 400 Billings, MT Phone: (406) FAX: (406) ryan.archer@usdoj.gov filed I'll \::"- (" n \ I L,.: \ '.:,) \": \'. ATTORNEY FOR PLAINTIFF UNITED STATES OF AMERICA IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MONTANA BUTTE DIVISION UNITED STATES OF AMERICA, vs. Plaintiff, MICHAEL ERNEST MONFORTON, JEFFERY NICHOLAS MCCOWN, JEANETTE SABINA MCCOWN, and SCOTT MICHAEL MCCOWN, CR 10-1(P INDICTMENT -BU- DwM CONSPIRACY TO COMMIT FRAUD (Count I) Title 18 U.S.C. 371 (Penalty: Five years imprisonment, $250,000 fine, and three years supervised release) Defendants.

2 Case 2:10-cr DWM Document 1 Filed 07/23/10 Page 2 of 15 WIRE FRAUD (Counts II-XI) Title 18 U.S.C (Penalty: twenty years imprisonment, $250,000 fine, and three years supervised release) THE GRAND JURY CHARGES: Introduction Country Classic Dairy, Inc. is a co-op based in Bozeman, Montana, and owned by the dairy producer members. Country Classic Dairy, LLC., is the trucking and transportation entity for the business. Both Country Classic Dairy, Inc. and Country Classic Dairy, LLC. ("Country Classic Dairy"), are governed by a Board of Directors. At all times relevant to this Indictment, MICHAEL ERNEST MONFORTON was the CEO of Country Classic Dairy, JEFFERY NICHOLAS MCCOWN was a manager, JEANETTE SABINA MCCOWN was the bookkeeper, and SCOTT MICHAEL MCCOWN was the shop manager. Count I Beginning in or about October 2007, and continuing thereafter until in or about December 2008, at Bozeman and elsewhere, in the 2

3 Case 2:10-cr DWM Document 1 Filed 07/23/10 Page 3 of 15 State and District of Montana, defendants MICHAEL ERNEST MONFORTON, JEFFERY NICHOLAS MCCOWN, JEANETTE SABINA MCCOWN, and SCOTT MICHAEL MCCOWN, did knowingly and unlawfully conspire amongst themselves to devise a material scheme and artifice to defraud by causing the transmission of interstate wires, in violation of 18 U.S.C Object ofthe Conspiracy It was the object of the conspiracy that the above-named defendants obtained goods and services for their own personal use and enjoyment while causing Country Classic Dairy to pay for those personal goods and expenses by billing and charging them to the company without authorization and unlawfully claiming the purchases as legitimate business expenses. Manner and Means ofthe Conspiracy In order to execute and accomplish the conspiracy, MICHAEL ERNEST MONFORTON, JEFFERY NICHOLAS MCCOWN, JEANETTE SABINA MCCOWN, and SCOTT MICHAEL MCCOWN unlawfully and without authorization: 3

4 Case 2:10-cr DWM Document 1 Filed 07/23/10 Page 4 of used Country Classic Dairy business credit cards for personal purchases that were mis-coded in Country Classic Dairy's books and records; 2. made personal purchases and submitted the receipts from those purchases for personal reimbursement from Country Classic Dairy business funds by misidentifying the expense as business related; 3. purchased personal goods and services at various business vendors and directly billed Country Classic Dairy by concealing the true nature of the purchase and making it appear to be a legitimate business expense. Overt Acts In furtherance of the conspiracy, and to effect the objects thereof, MICHAEL ERNEST MONFORTON, JEFFERY NICHOLAS MCCOWN, JEANETTE SABINA MCCOWN, and SCOTT MICHAEL MCCOWN committed overt acts including, but not limited to, the following: 1. on or about October 16, 2007, JEFFERY NICHOLAS MCCOWN caused a turbo charger for his 1977 Ford pickup 4

5 Case 2:10-cr DWM Document 1 Filed 07/23/10 Page 5 of 15 to be purchased and Country Classic Dairy to be billed for $4, that was falsely represented as a "shop" expense; 2. from on or about August 14, 2008, through on or about December 19,2008, JEFFERY NICHOLAS MCCOWN used his Country Classic Dairy Advanta business credit card checks to charge $75,000 in cash advances for monthly payments on personal vehicles titled to himself and MICHAEL ERNEST MONFORTON that were mis-coded into the company books and records as "leased equipment"; 3. on or about July 17, 2008, SCOTT MICHAEL MCCOWN caused a motor for his older-model Camaro to be purchased and Country Classic Dairy to be billed for $1, that was falsely represented as a "shop" expense; 4. on or about April 3, 2008, SCOTT MICHAEL MCCOWN used his Country Classic Dairy Advanta business credit card to charge $3, for wheels and tires for a boat trailer that were mis-coded in the company books and records as "occurred tires"; 5

6 Case 2:10-cr DWM Document 1 Filed 07/23/10 Page 6 of from on or about November 8,2007, through February 29, 2008, MICHAEL ERNEST MONFORTON used his Country Classic Dairy Advanta business credit card to charge over $8,500 for personal expenses at Montana State University that were mis-coded in the company books and records as "advertising and promotion" and "professional services"; 6. on November 29, 2008, MICHAEL ERNEST MONFORTON used his Country Classic Dairy American Express business credit card to charge the company $3,115 for three season ski passes at Big Sky Resort for himself and family members that was mis-coded in the company books and records as "advertising and promotion"; 7. on or about December 16, 2007, JEANNETTE SABINA MCCOWN used her Country Classic Dairy American Express business credit card to charge the company $1,500 for three $500 gift cards at Sportsman's Warehouse that were mis-coded in the company books and records as "advertising and promotion"; the gift cards were later used 6

7 Case 2:10-cr DWM Document 1 Filed 07/23/10 Page 7 of 15 by JEFFERY NICHOLAS MCCOWN as partial payment for a Smith and Wesson Rifle, scope and other personal items; 8. on or about February 25, 2008, JEANNETTE SABINA MCCOWN used her Country Classic Dairy American Express business credit card to charge the company $ for an Apple IPOD that was unrelated to any business purpose, and was mis-coded in the company books and records as "accidents and damages." All in violation of 18 U.s.C. 37l. Counts II - XI The Scheme and Artifice to Defraud That beginning in or about October 2007 and continuing thereafter until in or about December 2008, defendants MICHAEL ERNEST MONFORTON, JEFFERY NICHOLAS MCCOWN, JEANETTE SABINA MCCOWN, and SCOTT MICHAEL MCCOWN, at Bozeman and elsewhere, in the State and District ofmontana, defrauded Country Classic Dairy out of hundreds of thousands of dollars by means of materially false and fraudulent pretenses, and representations, and did knowingly and unlawfully cause the company 7

8 Case 2:10-cr DWM Document 1 Filed 07/23/10 Page 8 of 15 to pay for goods and services used for their own personal benefit and enjoyment. In order to effectuate the scheme MICHAEL ERNEST MONFORTON, JEFFERY NICHOLAS MCCOWN, JEANETTE SABINA MCCOWN, and SCOTT MICHAEL MCCOWN caused interstate wire communications by using their business credit cards to make personal purchases, while the entries into the corporate books and records were mis-coded to make the purchases appear to be legitimate business expenses. Count II On or about November 29, 2008, at Big Sky, in the State and District of Montana, the defendant, MICHAEL ERNEST MONFORTON, for the purpose of executing the aforementioned material scheme and artifice to defraud, and for obtaining money and property by means of material false and fraudulent pretenses and representations, did knowingly cause to be transmitted in interstate commerce by means of wire communications, a credit card authorization from Big Sky Resort in Big Sky, Montana, to an American Express processing center in Phoenix, Arizona, which 8

9 Case 2:10-cr DWM Document 1 Filed 07/23/10 Page 9 of 15 represented a credit card transaction with American Express Card number xxxx-xxxxxx-x1025, for the $3,115 purchase of three season ski passes, all in violation of 18 U.S.C Count III On or about February 29, 2008, at Bozeman, in the State and District of Montana, the defendant, MICHAEL ERNEST MONFORTON, for the purpose of executing the aforementioned material scheme and artifice to defraud, and for obtaining money and property by means of material false and fraudulent pretenses and representations, did knowingly cause to be transmitted in interstate commerce by means ofwire communications, a credit card authorization from Montana State University in Bozeman, Montana, to an Advanta processing center in Pennsylvania, which represented a credit card transaction with Advanta Card number xxxx-xxxx-xxxx- 9161, for the $3,252 payment of personal expenses at Montana State University, all in violation of 18 U.s.C Count IV On or about February 27,2008, at Bozeman, in the State and District ofmontana, the defendant, MICHAEL ERNEST 9

10 Case 2:10-cr DWM Document 1 Filed 07/23/10 Page 10 of 15 MONFORTON, for the purpose of executing the aforementioned material scheme and artifice to defraud, and for obtaining money and property by means of material false and fraudulent pretenses and representations, did knowingly cause to be transmitted in interstate commerce by means of wire communications, an electronic payment from Country Classic Dairy's bank account at Yellowstone Bank in Bozeman, Montana, account number xxx1526, to an American Express processing center in Phoenix, Arizona, which represented payment on his business American Express card number xxxx-xxxxxx-xl025, and included a $1, purchase of a white rose wedding collection and white rose centerpieces, all in violation of 18 U.s.C Count V On or about November 12, 2007, at Belgrade, in the State and District of Montana, the defendant, JEFFERY NICHOLAS MCCOWN, for the purpose of executing the aforementioned material scheme and artifice to defraud, and for obtaining money and property by means of material false and fraudulent pretenses and representations, did knowingly cause to be transmitted in interstate commerce by means of wire communications, a credit card authorization from Rocky Mountain 10

11 Case 2:10-cr DWM Document 1 Filed 07/23/10 Page 11 of 15 Truck Center in Belgrade, Montana, to an American Express processing center in Phoenix, Arizona, which represented a credit card transaction with American Express Card number xxxx-xxxxxx-x2007, for $3, which comprised partial payment for a 2008 Trailmax trailer titled to JEFFERY NICHOLAS MCCOWN, all in violation of 18 U.S.C Count VI On or about February 9, 2008, at Bozeman, in the State and District of Montana, the defendant, JEFFERY NICHOLAS MCCOWN, for the purpose of executing the aforementioned material scheme and artifice to defraud, and for obtaining money and property by means of material false and fraudulent pretenses and representations, did knowingly cause to be transmitted in interstate commerce by means of "wire communications, a credit card authorization from Sportsman's Warehouse in Bozeman, Montana, to an American Express processing center in Phoenix, Arizona, which represented a credit card transaction with American Express Card number xxxx-xxxxxx-x2007, for the $ purchase of a.45 caliber handgun, holster and ammunition, all in violation of 18 U.S.C

12 Case 2:10-cr DWM Document 1 Filed 07/23/10 Page 12 of 15 Count VII On or about July 14, 2008, at Missoula, in the State and District of Montana, the defendant, JEFFERY NICHOLAS MCCOWN, for the purpose of executing the aforementioned material scheme and artifice to defraud, and for obtaining money and property by means of material false and fraudulent pretenses and representations, did knowingly cause to be transmitted in interstate commerce by means of wire communications, a credit card authorization from Gull Boats and RV in Missoula, Montana, to an American Express processing center in Phoenix, Arizona, which represented a credit card transaction with American Express Card number xxxx-xxxxxx-x2007, for $4, comprising work completed on JEFFERY NICHOLAS MCCOWN'S personal R.V., all in violation of 18 U.S.C Count VIII On or about December 24,2007, at Bozeman, in the State and District of Montana, the defendant, JEANETTE SABINA MCCOWN, for the purpose of executing the aforementioned material scheme and artifice to defraud, and for obtaining money and property by means of material false and fraudulent pretenses and representations, did 12

13 Case 2:10-cr DWM Document 1 Filed 07/23/10 Page 13 of 15 knowingly cause to be transmitted in interstate commerce by means of wire communications, a credit card authorization from Sportsman's Warehouse in Bozeman, Montana, to an American Express processing center in Phoenix, Arizona, which represented a credit card transaction with American Express Card number xxxx-xxxxxx-xloi7, for a $ purchase of handgun ammunition, a gun case, range finder and other personal goods, all violation of 18 U.S.C Count IX On or about April 17, 2008, at Bozeman, in the State and District of Montana, the defendant, JEANETTE SABINA MCCOWN, for the purpose of executing the aforementioned material scheme and artifice to defraud, and for obtaining money and property by means of material false and fraudulent pretenses and representations, did knowingly cause to be transmitted in interstate commerce by means of wire communications, an electronic payment from Country Classic Dairy's bank account at Yellowstone Bank in Bozeman, Montana, account number xxx1526, to an American Express processing center in Phoenix, Arizona, which represented payment on her business American Express card number xxxx-xxxxxx-xl017, and included a $6,500 partial 13

14 Case 2:10-cr DWM Document 1 Filed 07/23/10 Page 14 of 15 payment to Callville Bay for the rental of two house boats on Lake Mead, Nevada, all violation of 18 U.S.C Count X On or about November 23, 2007, at Bozeman, in the State and District of Montana, the defendant, JEANETTE SABINA MCCOWN, for the purpose of executing the aforementioned material scheme and artifice to defraud, and for obtaining money and property by means of material false and fraudulent pretenses and representations, did knowingly cause to be transmitted in interstate commerce by means of wire communications, a credit card authorization from Costco in Bozeman, Montana, to an American Express processing center in Phoenix, Arizona, which represented a credit card transaction with American Express Card number xxxx xxxxxx xl017, for the $ purchase of a home theater system, all violation of 18 U.S.C Count XI On or about April 3, 2008, at Butte, in the State and District of Montana, the defendant, SCOTT MICHAEL MCCOWN, for the purpose of executing the aforementioned material scheme and artifice to defraud, and for obtaining money and property by means of material 14

15 Case 2:10-cr DWM Document 1 Filed 07/23/10 Page 15 of 15 false and fraudulent pretenses and representations, did knowingly cause to be transmitted in interstate commerce by means of wire communications, a credit card authorization from Les Schwab in Butte, Montana, to an Advanta processing center in Pennsylvania, which represented a credit card transaction with his Country Classic Dairy Advanta business credit card, for the $3, payment for boat trailer wheels, tires and balancing, all in violation of 18 U.s.C and 2. A TRUE BILL. FOREPERSON United States Attorney Attorney for Plaintiff Warrant: Bail: ---" /17)/0 Criminal Chief Assistant U.S. Attorney ),I Attorney for Plaintiff 30 fl1i. 15 t11 S lit / J c.-l