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May 16, 2008 5:12 pm US/Eastern
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Executive Pleads Guilty In $40M Fraud Scheme
BALTIMORE (WJZ) ―
A former CPA in Cockeysville pleaded guilty Friday in one of the state's largest fraud schemes--$40 million worth.
Kelly McPherson reports Alan Fabian admitted in federal court to years of lying and cheating.
The judge in this case says Fabian committed a massive fraud. Friday was the first time Fabian accepted responsibility for defrauding the U.S. government, banks and lenders out of millions of dollars.
Fabian plead guilty to just two of the 26 charges, mail fraud and filing false tax returns. But in court he admitted to deceiving several companies for nearly $40 million.
"Mr.Fabian would claim that he was using the money to buy things like computer equipment, but there wasn't really any equipment. What he was really doing was using the money for other purposes, buying homes, buying a yacht, buying a lot of different things for his personal use," said U.S. Attorney Rod Rosenstein.
Fabian also admitted to lying at bankruptcy hearings and filing multiple false tax returns.
In court the defense stated Fabian is anxious to admit his crimes.
This conviction sends a message to other white-collar criminals.
"After cheating a variety of victims out of $32 million, Mr. Fabian went right around and started a new scheme and defrauded additional victims of another $7.5 million. We need people to know that if you do something like that, you're going to pay the price," said Rosenstein.
This case only comes second to John Rusnak's conviction in 2002. He stole $700 million.
The next step in the case is sentencing, which typically takes one day. But because of the scope of this scheme, they're planning for three to four days to figure out how long Fabian will be in federal prison.
Fabian now faces up to 33 years in federal prison. He was released with conditions and will be sentenced in September.
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