David Saks: ACCOUNTANT GUILTY OF BANKRUPTCY FRAUD

David Saks - Real Estate Broker - The Real Estate Mart of Tennessee, Inc. - 4040 North Watkins-Suite #4 - Memphis, Tennessee 38127 - Phone (901) 357-4663

ACCOUNTANT GUILTY OF BANKRUPTCY FRAUD

Forensic Accountant Found Guilty of Bankruptcy Fraud

U.S. Attorney’s Office August 28, 2012
  • Middle District of Florida (813) 274-6000
 

ORLANDO, FL—U.S. Attorney Robert E. O’Neill announces that a federal jury today found John K. Freeman (66, Mount Dora) guilty of concealing property belonging to the estate of a bankruptcy debtor. Freeman faces a maximum penalty of five years in federal prison. His sentencing hearing is scheduled for November 30, 2012.

A superseding indictment was returned against Freeman on September 7, 2011.

According to testimony presented at trial, Freeman, who is a certified public accountant and forensic accountant, did not disclose that he was in possession of over $700,000 in checks the day before he filed for bankruptcy in the Middle District of Florida. Bank and real estate records revealed that several checks were made out to his 85 year-old mother, while Freeman had the legal authority to negotiate the checks as his mother’s “attorney in fact.”

Within a week of filing bankruptcy, Freeman opened a joint bank account under his mother’s Social Security number and deposited the checks into the account. Representatives from the Office of the United States Trustee testified that Freeman had the obligation to disclose the existence of the checks and the account during the creditors meeting and amend his bankruptcy petition, but failed to do so. Bank records showed that between August 2005 and the time that the account was closed, in July 2006, Freeman used funds from the account to pay a Lake County, Florida country club, purchase a luxury vehicle, pay various attorneys, pay-off an existing mortgage for a commercial building that he owned in Indiana, and withdraw approximately $150,000 in cash. He transferred the balance of the account (approximately $380,000) to another account on the day that he filed a motion to dismiss his bankruptcy petition.

At trial, Freeman testified that he notified his bankruptcy attorney of all of the facts surrounding a real estate transaction and assignment of judgment that caused the checks to be issued; that he was not present at a real estate closing when the checks were issued; that his elderly mother had a valid judgment lien against him and that she opened the joint bank account, made the initial deposit, and directed him to write the various checks in 2005 and 2006.

This case was investigated by the Federal Bureau of Investigation and assistance was provided by the Office of the United States Trustee. It is being prosecuted by Assistant United States Attorney Daniel W. Eckhart.

source: FBI



David Saks



Time&Temp Memphis

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Comment balloon 0 commentsDavid Saks • August 28 2012 04:23PM

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