Oakland Resident Pleads Guilty To Conspiring To Sell Fraudulent Financial Instruments And Underreporting Income
OAKLAND – Kenneth Taylor pleaded guilty today to conspiracy to commit wire fraud and to filing a false federal income tax return, announced United States Attorney David L. Anderson, Principal Deputy Assistant Attorney General Ricard E. Zuckerman, Federal Bureau of Investigation Special Agent in Charge John F. Bennett, and Internal Revenue Service, Criminal Investigation (IRS-CI), Special Agent in Charge Kareem Carter. The plea was accepted by the Honorable Jon S. Tigar, U.S. District Judge.
According to the plea agreement, between 2009 and 2012, Taylor, of Oakland, Calif., conspired with at least one of his codefendants, Sharon Ringgenberg, of Martinez, and Craig Scott, of Lafayette, to generate and transmit to banks fraudulent standby letters of credit and proof of funds statements. The fraudulent financial instruments were issued by Success Bullion USA, LLC (SBUSA), an entity that was falsely advertised as the United States subsidiary of a large Hong Kong financial institution. Among the reasons that the financial instruments were fraudulent is that they reported false client creditworthiness and they reported client balances that exceeded SBUSA’s assets.
Taylor admitted that, at times when dealing with customers, he posed as a fictional Hong Kong-based attorney for SBUSA. Taylor also admitted he assisted in the creation of SBUSA’s website and that another entity he controlled, Centerlink, LLC, transmitted the fraudulent instruments to banks in a format that rendered the instruments unenforceable. Taylor received at least $550,000 from the scheme. Taylor acknowledged the proceeds were sent to a bank account in Belize he controlled in the name of Centerlink, LLC.
Furthermore, Taylor admitted he filed false 2009 and 2010 federal income tax returns that underreported his income in each year. Taylor also acknowledged he did not file a tax return for tax years 2011 through 2015 despite receiving sufficient income in each year and knowing that he was required to file a return.
On April 13, 2017, a federal grand jury indicted Taylor, Ringgenberg, and Scott. Taylor was charged with one count of conspiracy to commit wire fraud, in violation of 18 U.S.C. § 1349; two counts of wire fraud, in violation of 18 U.S.C. § 1343; and two counts of subscribing to false tax returns, in violation of 26 U.S.C. § 7206(1). Today, Taylor pleaded guilty to the conspiracy count and to one count of making and subscribing a false tax return. If Taylor complies with the plea agreement, the remaining counts pending against him will be dismissed at sentencing.
Judge Tigar scheduled Taylor’s sentencing for August 30, 2019. The maximum statutory sentence for conspiring to commit wire fraud is 20 years in prison and a $250,000 fine. The maximum statutory sentence for making and subscribing a false tax return is three years in prison and a $250,000 fine. However, any sentence following conviction will be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Ringgenberg and Scott have both pleaded guilty to their respective roles in the scheme; their sentencings have not yet been scheduled.
Assistant United States Attorney Colin Sampson and Department of Justice Tax Division Trial Attorney Charles A. O’Reilly are prosecuting the case. This case is the result of an investigation by the FBI and IRS-CI.