Monday, October 24, 2005

Former Law Firm Employee Sentenced to Statutory Maximum for Wire Fraud

A former employee of a Houston law firm, Roy Allen, received the maximum five-year sentence for mail fraud for a scheme to use the firm's money to fund a purchase of a house that Allen hoped to flip in a quick sale so that he could repay the money without being noticed.  The scheme took place in 2001, before the statutory maximum was bumped up to 20 years by the Sarbanes-Oxley Act in 2002. According to a press release issued by the U.S. Attorney's Office (here):

While employed with Gallagher, Lewis, Downey & Kim, a Houston law firm, Waters had limited authority to request transfers from the firms accounts to carry out firm business. However, without authority or authorization, Waters requested and secured transfers of substantial sums of the firms funds for his own use. Waters attempted to conceal his theft by transferring more than $2.5 million in the firm's fund to purchase houses in the Royal Oaks Subdivision in Houston with the hope of using anticipated profits from the resale of those houses to secretly pay back the money. This illegal wire transfer took place on May 14, 2001. When his theft was detected, Waters transferred ownership of the houses to the firm.


Fraud, Sentencing | Permalink

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