Financial Fraud: PAUL D. LAMARCHE Pleaded Guilty To Wire Fraud And Theft Of Government Property



Financial Fraud
Captain of Prominent Tourist Sailing Ship Sentenced to Prison for Illegally Claiming Disability

Captain of Prominent Tourist Sailing Ship Sentenced to Prison for Illegally Claiming Disability

Collected Disability Payments Claiming He Couldn’t Work, while Telling Coast Guard He had No Impairments for Captain’s Credentials

The Captain of a Seattle tourist sailboat was sentenced today in U.S. District Court in Seattle to 9 months in prison, two years of supervised release, a $5,500 fine and $324,738 in restitution and civil penalty, announced U.S. Attorney Annette L. Hayes. PAUL D. LAMARCHE, 67, pleaded guilty to wire fraud and theft of government property in March 2018, admitting he collected more than $177,000 in disability payments from the Railroad Retirement Board while operating Emerald City Charters – a tourist attraction running sailing ships on the Seattle waterfront. At the sentencing hearing U.S. District Judge James L. Robart said LAMARCHE was “…stealing from the government and lying about it…. He’s obviously made a lot of money, but he’s stealing every year… He’s a thief.”

According to records filed in the case, in June 1988, LAMARCHE claimed he could no longer work as a Burlington Northern Brakeman/Conductor due to a back injury. In August 1993, he began receiving a disability annuity from the Railroad Retirement Board. In connection with those payments, he certified annually that his medical condition had not improved, that he was unable to work and had limited earnings. In fact, from 1984 to the present, LAMARCHE owned and operated Emerald City Charters, which operates two large sea-going sailboats on Elliott Bay. While claiming disability, LAMARCHE submitted multiple forms to the U.S. Coast Guard certifying that he had no impairments that limit his physical activities or ability to pilot the sailboats.

On multiple occasions in various settings, LAMARCHE appeared in promotional videos actively sailing the boats. He made statements that he had missed “only a couple days of work in 23 years,” and he appeared in a television feature story doing yoga on a stand-up paddleboard. Even as the Railroad Board began investigating his disability claim in 2015, he continued to submit false reports claiming he was not able to “lift, pull or carry heavy items” was “unable to run or jump,” and had “debilitating headaches daily.” He now admits all those statements were false.

In addition to the $177,369 in restitution, LAMARCHE agreed to pay an additional $177,369 as a civil penalty for violating the False Claims Act. The U.S. Coast Guard has a pending action to address LAMARCHE’s Captain’s license. LAMARCHE was ordered to report to prison October 2, 2018.

The case was investigated by Special Agents of the Railroad Retirement Board Office of Inspector General (RRB-OIG) and U.S. Coast Guard Investigative Service.

The case was prosecuted by Assistant United States Attorney Stephen Hobbs and the civil investigation and settlement were handled by Assistant United States Attorney Kayla Stahman and Investigator Judy Swem.

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