https://townhall.com/tipsheet/scott-mcclallen/2025/09/11/5-charged-for-wire-fraud-money-laundering-through-home-improvement-stores-n2663150

A five-count indictment unsealed in federal court in Brooklyn charges five defendants with conspiracy to commit wire fraud, conspiracy to commit bank fraud, bank fraud, access device fraud and conspiracy to commit money laundering. 

From July 2023 through September 2025, the five people allegedly fraudulently acquired and resold over $20 million in building and construction materials, and appliances from home improvement and hardware stores throughout Brooklyn, Queens, Long Island and elsewhere.  The defendants were arrested and arraigned yesterday before United States Magistrate Judge Seth D. Eichenholtz.

“For these defendants, the tools of their trade were not hammers and nails, but fraud and deception.  They enriched themselves by targeting programs designed for hard working consumers and small businesses to buy materials for construction and home improvement,” stated United States Attorney Nocella.  “Today’s arrests serve as a warning to those who try to profit from retail fraud: crime doesn’t pay.”

Court records say that the defendants and their co-conspirators opened, or caused others acting at their direction to open, hundreds of lines of credit that hardware and home improvement stores made available to customers through the stores’ partner banks.

These lines of credit included traditional consumer credit cards, which were designed for individual consumers’ personal use at the stores, and commercial lines of credit, which were aimed primarily for small businesses to purchase goods at the stores. 

The defendants opened many of these credit lines in the names of other people or on behalf of shell companies that had recently been founded or incorporated, were created in the names of straw owners and/or had no legitimate business operations.  To increase the credit limits on their credit lines, the defendants presented paper checks to the stores under the guise of pre-funding the accounts or paying for past purchases.  In reality, these checks were linked to bank accounts that had insufficient funds to cover the amounts printed on the checks.  Before the checks were rejected, however, the defendants purchased significant amounts of building and construction materials for delivery to their warehouses.  In total, the defendants and their co-conspirators stole over $20 million in merchandise, much of which they resold to others.  Profits of their scheme were then laundered to offshore bank accounts and used to finance the ongoing operations of their warehouses.

“The Secret Service is proud to help disrupt an alleged criminal syndicate that carried out an elaborate fraud scheme here in New York City, siphoning millions of dollars into its coffers through bad checks in order to procure construction-related materials for illegitimate resale," stated USSS Special Agent in Charge McCool.  “I want to congratulate our agents and our partners at both the Eastern District of New York and the NYPD for their hard work in holding these criminals accountable.”

The charges in the indictment are allegations and the defendants are presumed innocent unless and until proven guilty. If convicted of the charges, the defendants each face up to 30 years in prison.

“These defendants allegedly deceived credit lenders with bogus bank checks to steal more than the $20 million of merchandise from hardware and home improvement businesses,” stated NYPD Commissioner Tisch.  “Schemes like this don’t just affect retail corporations – they hurt honest consumers who rely on these programs to purchase trade supplies.  I am thankful to the NYPD investigators, our federal partners at the United States Secret Service and HSI, and the U.S Attorney’s Office for shutting this scam operation down and holding these fraudsters accountable.”

The government’s case is being handled by the Office’s Business and Securities Fraud Section.  Assistant United States  Attorney James R. Simmons is in charge of the prosecution, with assistance from Paralegal Specialist Asher Martin-Rosenthal.

Joseph Nocella, Jr., United States Attorney for the Eastern District of New York, Matt McCool, Special Agent in Charge, United States Secret Service, and Jessica S. Tisch, Commissioner, New York City Police Department, announced the arrests and charges.