CASE RESULTS: PLEA AGREEMENT AND SENTENCING HEARING IN WHITE COLLAR CRIME CASE

In a plea agreement negotiated with the Federal Government, a Mastantuono Law Office client received a prison sentence for a white collar criminal case involving a fraud scheme. What the article below did not report is that our client received a prison sentence approximately 20 months lower than the applicable federal sentencing guideline calculation, reflective of his cooperation, his repayment of a large portion of the diverted money, and Mastantuono Law Office’s plea negotiations with the federal government.

Former Car Dealer Sentenced to Prison in Loan SchemeMarch 18, 2011By John Diedrich, Journal Sentinel

A former Menomonee Falls used car dealer has been sentenced to 6 ½ years in prison for bilking $2.5 million from banks in a scheme that involved taking out multiple loans on the same vehicles.

Steve Coffee, former owner of Northwoods Motor Cars, was sentenced by Chief U.S. District Judge Charles Clevert on Wednesday in Milwaukee.

Clevert also gave Coffee, 40, five years’ probation and ordered him to pay a maximum of $2.1 million in restitution, though that amount could be reduced depending on filings in the next few months, according to online federal court records.

The case was described by Assistant U.S. Attorney Greg Haanstad in his sentencing memo as a “large-scale bank fraud.”

According to court documents, Coffee had threatened an attorney and a former employee, suggesting he knew a gang member who would come after them.

Almost a year ago, Coffee pleaded guilty to bank fraud. He has been cooperating with authorities but has remained behind bars since his arrest.

In his memo, Haanstad recommended 6 ½ years in prison, noting Coffee had no criminal record but that the size of the fraud required a prison term. Coffee’s attorney, Craig Mastantuono, asked Clevert for 50 to 60 months, saying in his sentencing memo that Coffee paid about $1.5 million of the amount defrauded from the banks. Mastantuono also noted Coffee’s cooperation and added that he has mental health issues that contributed to the crime.

According to the court documents, Coffee had owned Northwoods Motor Cars for nearly three years.

The business had a second location in Rosendale, west of Fond du Lac.

In 2007, Coffee began arranging for numerous loans to be taken out on the same vehicles, according to documents. He recruited more than 30 people to act as straw buyers and had them apply for 100 fraudulent loans, totaling more than $2.5 million.

Federal agents with the U.S. Postal Inspection Service learned about the fraud in 2009 when a Waukesha County man told authorities that when he tried to renew the registration on his 2007 Toyota Camry, state officials said he no longer owned the car. In fact, the Camry had been “sold” three other times, all while the Waukesha man continued to drive the car. Coffee made it appear another car in the scam was sold seven times in five months.

It appeared the state and the banks did not verify that there were other loans on the vehicles.

After the loans were made, Coffee made some monthly payments, Haanstad wrote in his memo, but added “they were made in large part to keep the scheme afloat.”

As federal agents closed in, Coffee fled. He bolted from his Washington County home and headed to northern Wisconsin. He sketched out a “to do” list that included tasks such as getting a new birth certificate, library card and fishing license for himself and obtaining new identities for his children.

Coffee called a lawyer, James Gende II, who represented one of Coffee’s former employees in a sexual harassment case against Coffee, Haanstad said.

“I have this customer that is a crazy big black ghetto Vice Lord guy that basically will do me any favor,” Coffee said on the recording. “I’m just calling to let you know that I’m having him come after you and (the former employee) for payback.”

In response, Gende said: “I don’t understand what you are saying, Steve.”

“It’s a threat,” Coffee replied. “I’m gonna go now because I’m sure you’ll be meeting him shortly.”