Washington (Aug. 16, 2004) -- Two former executives of a Detroit-based steel processing company were found guilty of tax, conspiracy and money laundering charges in connection with a $6.5 million kickback scheme.
A Detroit federal jury returned guilty verdicts on all 10 felony counts against former Thyssen Inc. chief executive Kenneth J. Graham, 69, and former executive vice president Kyle E. Dresbach, 68, the Justice Department announced this week.
Graham and Dresbach were convicted of conspiracy to commit mail fraud and to file false tax returns that failed to report more than $6.5 million in proceeds from the mail fraud scheme, and conspiracy to launder more than $6.5 million, as well as money laundering, and filing false income tax returns.
Each faces a maximum sentence totaling 71 years in prison and $2.25 million in fines, together with costs of prosecution. Their sentencings are scheduled for Nov. 19. At that time, U.S. District Judge Arthur Tarnow will also rule on whether Graham and Dresbach must forfeit homes in, respectively, Vero Beach, Fla., and West Bloomfield, Mich.
According to the DoJ, Graham and Dresbach conspired with attorney and CPA Jerome Jay Allen, 67, of Bloomfield Hills, Mich., to cause Thyssen to pay inflated prices for certain equipment. The equipment vendors paid the inflated prices as commissions to a consultant, which then paid kickbacks to more than a dozen entities controlled by Allen. Allen then laundered the funds and used his client trust fund accounts to pay kickbacks to Graham and Dresbach. Graham and Dresbach also conspired with Allen to file false individual income tax returns, the DoJ said. Allen pled guilty last August to a charge of conspiracy to commit mail fraud and file false tax returns.
-- WebCPA staff
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