TV Stars Admit Conspiracy, Tax Offenses, Loan and Bankruptcy Fraud

Allison Tussey —  March 5, 2014 — Leave a comment

Teresa Giudice, 41, and Giuseppe “Joe” Giudice, 43, both of Towaco, New Jersey, two of the stars of the Bravo TV television show “The Real Housewives of New Jersey,” admitted committing a string of crimes as part of a long-running financial fraud conspiracy.

The defendants pleaded guilty before U.S. District Judge Esther Salas in Newark federal court to several counts of the superseding indictment returned against them in July 2013. The Giudices each pleaded guilty to one count of conspiracy to commit mail and wire fraud, one count of bankruptcy fraud by concealment of assets, one count of bankruptcy fraud by false oaths, and one count of bankruptcy fraud by false declarations. Giuseppe Giudice also pleaded guilty to one count of failure to file a tax return.

According to the Superseding Indictment, statements made in court, and as previously reported by Mortgage Fraud Blog:

From September 2001 through September 2008, Giuseppe and Teresa Giudice engaged in a mail and wire fraud conspiracy in which they submitted fraudulent applications and supporting documents to lenders in order to obtain mortgages and other loans. The Giudices falsely represented on loan applications and supporting documents that they were employed and/or receiving substantial salaries when they were either not employed or not receiving such salaries.

In September 2001, Teresa Giudice applied for a $121,500 mortgage loan for which she submitted a loan application falsely claiming she was employed as an executive assistant. She also submitted fake W-2 forms and fake pay stubs purportedly issued by her employer. For a $361,250 mortgage loan that Teresa Giudice obtained in July 2005, she and Giuseppe Giudice prepared a loan application which falsely stated she was employed as a realtor and that she made a monthly salary of $15,000. In reality, Teresa Giudice was not employed at the time.

The Giudices also admitted they committed bank fraud and loan application fraud in the course of obtaining loans from several banks. On Oct. 29, 2009, they filed a petition for individual Chapter 7 bankruptcy protection in U.S. Bankruptcy Court in Newark. Over the next few months, they filed several amendments to the bankruptcy petition. As part of the bankruptcy filings, the Giudices were required to disclose to the United States Trustee their assets, liabilities, income and any anticipated increase in income. The Giudices intentionally concealed businesses they owned, income they received from a rental property, and Teresa Giudice’s true income from the television show “The Real Housewives of New Jersey,” website sales, and personal and magazine appearances. The Giudices concealed their anticipated increase in income from the then-upcoming second season of the show.

Giuseppe Giudice also admitted that during tax years 2004 through 2008, he received income totaling $996,459 but did not file tax returns for those years.

The conspiracy to commit mail and wire fraud count to which the Giudices each pleaded guilty carries a maximum potential penalty of 20 years in prison and a $250,000 fine. Each of the bankruptcy fraud counts carries a maximum potential penalty of five years in prison and a $250,000 fine. Teresa Giudice’s plea agreement requires her to pay $200,000 to the government at the time of sentencing, which is scheduled for July 8, 2014.

The plea agreements also require the Giudices to forfeit money which they obtained via conspiracy to commit mail and wire fraud and bankruptcy fraud, in an amount to be determined by the court at sentencing.

U.S. Attorney Paul J. Fishman announced the guilty pleas.

U.S. Attorney Fishman credited special agents of the FDIC-OIG New York, under the direction of SAC Evans; special agents of the IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Larsen; and Region 3 U.S. Trustee Roberta A. DeAngelis and the Newark office of the U.S. Trustee, with the investigation which led to today’s guilty pleas.

The government is represented by Assistant U.S. Attorney Jonathan W. Romankow of the office’s Criminal Division, and Counsel to the U.S. Attorney Rachael A. Honig, in Newark.

“Teresa and Giuseppe Giudice used deception and fraud to cheat banks, bankruptcy court and the IRS,” said U.S. Attorney Fishman. “With their guilty pleas, they admitted the schemes with which they were charged. Having now confessed their wrongdoing, the Giudices face the real cost of their criminal conduct.”

“The Federal Deposit Insurance Corporation (FDIC) Office of Inspector General (OIG) is pleased to join our law enforcement colleagues in announcing these guilty pleas today,” A. Derek Evans, Special Agent in Charge of FDIC-OIG, New York Region, said. “We are committed to combating bank fraud and bringing to justice those who engage in criminal conduct that undermines the integrity of our nation’s financial institutions.”

“Tax violations have been erroneously referred to as victimless crimes, which is a far cry from reality,” Acting Special Agent in Charge Jonathan D. Larsen, IRS-Criminal Investigation, Newark Field office, said. “Every time someone in America cheats on their taxes there are over 300 million victims. Tax fraud and bankruptcy fraud are real crimes with serious consequences as evidenced today by the guilty pleas of Giuseppe and Teresa Giudice.”

Allison Tussey

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