Bergen pair is indicted in $19M financial scam
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Saturday, September 30, 2006
BY KATE COSCARELLI Star-Ledger Staff
A pair of Bergen County men were indicted on charges that they were the architects of a $19 million financial scam that defrauded U.S. lenders, according to a federal indictment unsealed yesterday.
The 16-count indictment charges the Dinesh Dalmia, 45, of Fort Lee, and Ashish Paul, 45, of Norwood, with conspiracy, wire fraud and money laundering between January 2004 and last December. A third man, William Dowling, 42, of Columbus, Ohio, was also charged with conspiring to launder money, officials said.
This is the latest development in a federal investigation that began unfolding in March when fraud charges were filed against Dalmia, who ran a North Brunswick company and several others, and is believed to have engineered the massive scam in which financial companies paid to help equip telemarketing and debt collection call centers.
Dalmia, a fugitive, is in jail in India on unrelated stock fraud charges, authorities said yesterday.
Dowling turned himself into authorities in Ohio. And after a hear ing in federal court yesterday in Ohio, he was released on an unse cured bond, said Assistant U.S. At torney Kevin Walsh, who is handling the case in New Jersey. Dowling is expected to be arraigned in New Jersey in the coming weeks.
Paul was arrested at his Nor wood home early yesterday, authorities said. The bespectacled man also was in U.S. District Court in Newark yesterday for a brief hearing.
In court, Walsh argued Paul was a flight risk. He has been in New Jersey for less than a year and has an extensive travel history that included Pakistan, Singapore, Switzerland and the United Arab Emirates, said Walsh.
Magistrate Judge Mark Falk ordered Paul held at a detention facility until further proceedings next week.
The idea behind the scheme was that Dalmia's companies would get lenders would put up the money for the computer equip ment and call lists and the compa nies would make monthly lease payments. But authorities claim the equipment was old and lists did not exist. Dalmia often used the name Nick Mittal when he approached investors.
One of Dalmia's companies was Allserve Systems Corp. in North Brunswick, NJ. The company claimed it had a decade of experience equipping and organizing call centers.
As proof for his need for financing, Dalmia presented fake purchase agreements, invoices and delivery receipts, authorities say.
Paul was president of Cincom iOutsource, in Cincinnati, which allegedly created some of those documents. It was also the conduit for the $19 million in wire transfers to pass through on the way to various companies, including some that were just a shell.
The money went into bank ac counts for Dalmia, Paul and their co-conspirators, according to court papers. The indictment details a string of money transfers and bank transactions in the alleged scam.
A few months after lenders gave the money, the monthly lease payments from Dalmia's companies stopped. Allserve has filed for bankruptcy protection.
The lenders included Fifth Third Leasing Company in Ohio, CitiCaptial Technology Finance in Mahwah and G. E. Capital Finance in Connecticut, court papers show.
The indictment also seeks the return of the proceeds from the scam and Paul's $1.9 million house. Paul allegedly made the $600,000 down payment and first three mortgage payments on his Nor wood home with money from the scheme. In addition to spending money on a home, the indictment claims Paul also used to money from the scam pay credit cards, private school tuition payments and country club bills.
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LINK
Saturday, September 30, 2006
BY KATE COSCARELLI Star-Ledger Staff
A pair of Bergen County men were indicted on charges that they were the architects of a $19 million financial scam that defrauded U.S. lenders, according to a federal indictment unsealed yesterday.
The 16-count indictment charges the Dinesh Dalmia, 45, of Fort Lee, and Ashish Paul, 45, of Norwood, with conspiracy, wire fraud and money laundering between January 2004 and last December. A third man, William Dowling, 42, of Columbus, Ohio, was also charged with conspiring to launder money, officials said.
This is the latest development in a federal investigation that began unfolding in March when fraud charges were filed against Dalmia, who ran a North Brunswick company and several others, and is believed to have engineered the massive scam in which financial companies paid to help equip telemarketing and debt collection call centers.
Dalmia, a fugitive, is in jail in India on unrelated stock fraud charges, authorities said yesterday.
Dowling turned himself into authorities in Ohio. And after a hear ing in federal court yesterday in Ohio, he was released on an unse cured bond, said Assistant U.S. At torney Kevin Walsh, who is handling the case in New Jersey. Dowling is expected to be arraigned in New Jersey in the coming weeks.
Paul was arrested at his Nor wood home early yesterday, authorities said. The bespectacled man also was in U.S. District Court in Newark yesterday for a brief hearing.
In court, Walsh argued Paul was a flight risk. He has been in New Jersey for less than a year and has an extensive travel history that included Pakistan, Singapore, Switzerland and the United Arab Emirates, said Walsh.
Magistrate Judge Mark Falk ordered Paul held at a detention facility until further proceedings next week.
The idea behind the scheme was that Dalmia's companies would get lenders would put up the money for the computer equip ment and call lists and the compa nies would make monthly lease payments. But authorities claim the equipment was old and lists did not exist. Dalmia often used the name Nick Mittal when he approached investors.
One of Dalmia's companies was Allserve Systems Corp. in North Brunswick, NJ. The company claimed it had a decade of experience equipping and organizing call centers.
As proof for his need for financing, Dalmia presented fake purchase agreements, invoices and delivery receipts, authorities say.
Paul was president of Cincom iOutsource, in Cincinnati, which allegedly created some of those documents. It was also the conduit for the $19 million in wire transfers to pass through on the way to various companies, including some that were just a shell.
The money went into bank ac counts for Dalmia, Paul and their co-conspirators, according to court papers. The indictment details a string of money transfers and bank transactions in the alleged scam.
A few months after lenders gave the money, the monthly lease payments from Dalmia's companies stopped. Allserve has filed for bankruptcy protection.
The lenders included Fifth Third Leasing Company in Ohio, CitiCaptial Technology Finance in Mahwah and G. E. Capital Finance in Connecticut, court papers show.
The indictment also seeks the return of the proceeds from the scam and Paul's $1.9 million house. Paul allegedly made the $600,000 down payment and first three mortgage payments on his Nor wood home with money from the scheme. In addition to spending money on a home, the indictment claims Paul also used to money from the scam pay credit cards, private school tuition payments and country club bills.
NOTE: When you reply DELETE the text inside QUOTE