Federal prosecutors on Wednesday repeated calls for a judge to order former Fall River mayor Jasiel Correia to repay nearly $ 900,000 combined with forfeiture of ill-gotten gains and return to investors and to the Internal Revenue Service.
Prosecutors said Correia, sentenced Tuesday to 6 years in prison on extortion and other charges, stole money from investors in a smartphone app startup, SnoOwl, to pay for personal expenses, including a Mercedes, jewelry, designer shoes and trips to the casino. In May, a jury also found him guilty of tax evasion for filing forged tax returns.
But Judge Douglas P. Woodlock waited until Tuesday to decide on the final restitution and the amount of the fines. Prosecutors and defense lawyers disagree on whether Correia, 29, should hand over money obtained through the fraud that he never personally spent, and whether he must foot the bill in connection with the fraud convictions Woodlock dismissed on Monday due to a lack of hard evidence or testimony.
Prosecutors said that “the forfeiture and return should include uncharged and acquitted conduct that is part of a fraud scheme,” according to a brief filed Wednesday that cites a precedent before the United States Court of Appeals for the first circuit, United States v. Cox. The First Circuit, prosecutors said, noted that even if the government removes acquitted conduct from the total forfeiture tally, it is “not obligated to do so.”
Prosecutors asked Woodlock to order Correia to forfeit $ 566,740, pay a total of $ 310,240 to a handful of SnoOwl investors and $ 20,473 in restitution to the IRS.
Correia, who was 23 when he was first elected, “took steps to ensure control” of a Citizens Bank account where he deposited stolen funds, and he never gave others involved in SnoOwl have access to account statements or online banking, prosecutors said.
“Although the defendant unwittingly used the funds of the victim investors to purchase luxury goods for himself, travel and personal entertainment, to make personal student loan repayments and to make charitable donations in his own name, forfeiture is not limited to the money he actually spent on himself – rather it encompasses any funds he obtained as a result of his fraud scheme, “wrote on Wednesday prosecutors. “The fact that he did not spend every last penny of his victims’ money on his own personal luxuries – or that he did not have time to do so – does not not reduce the amount of fraud proceeds he obtained as a result of his fraud scheme. “
Correia’s defense attorneys William Fick and Daniel Marx said in a brief filed Wednesday that they recognize the cases cited by prosecutors. But Correia “preserves for possible further consideration its objection” that the reimbursement of any money related to uncharged conduct or acquitted convictions “violates its constitutional right to due process,” they wrote.
Correia also opposes the confiscation of funds “provided to SnoOwl which he did not embezzle or personally possess”. Rather, an appropriate measure would be 65% of gross investor funds as estimated by probation officers.
Prosecutors noted on Wednesday that Correia had not objected to the calculations in the initial forfeiture petition.
Woodlock, who had requested the briefs before making a final appeal on the financial side of sentencing, has yet to indicate whether he will hold any in-person briefings before his decision.
- Fall River Mayor Jasiel Correia defends SnoOwl app, claims innocence after fraud charge