SAN DIEGO â€” Former bookkeeper Claude Theodore Riley pleaded guilty September 11, 2017 to wire fraud and making a false tax return in a five-year scheme stealing from his employer, a local farm. Riley stole approximately $272,984.00 from his employer, filed fraudulent tax returns, and failed to file required employment tax returns resulting in a $1.5-million-dollar tax lien against the farm, according to a press release from theÂ U.S. Attorneyâ€™s Office,Â Southern District of California.
Riley served as the farmâ€™s bookkeeper from 2010 to 2015, overseeing the farmâ€™s entire annual budget. As the bookkeeper, Riley had access to the farmâ€™s bank accounts, paychecks, and bookkeeping records. Riley forged certain IRS documents to hide his embezzlement from the employer. For his scheme, Riley made 148 transactions out of the employerâ€™s bank account, fictitiously entered various vendors to be paid into the bookkeeping records, and generated checks made payable to himself.
â€œDefendant egregiously abused a sensitive position of trust when he stole more than $272,000 from an Imperial Valley farm and filed fraudulent tax returns,â€ stated Acting U.S. Attorney Alana W. Robinson. â€œI commend our federal and local law enforcement partnersâ€™ diligent efforts to obtain justice for this local farm, which is one of many that serve as the economic backbone of Imperial Valley.â€
â€œSpanning more than five years, Mr. Riley stole funds by issuing unauthorized checks from his employerâ€™s bank account and depositing them to his personal bank account,â€ stated R. Damon Rowe, Special Agent in Charge of IRS Criminal Investigation. â€œOur office will vigorously investigate individuals who line their pockets with fraudulently obtained funds and then file fraudulent tax returns.â€
â€œThe FBI is committed to uncovering fraud schemes that affect our community,â€ said FBI Special Agent in Charge Eric S. Birnbaum. â€œThe financial stability of Imperial Valleyâ€™s agricultural businesses are essential to the local economy. Crimes that undercut the hard work of our Valleyâ€™s farming industry will not be tolerated.â€
â€œThis case is a great example of how local and federal law enforcement agencies can work together to protect and serve the community,â€ said Brawley Police Department Interim Chief of Police Kelly L. Brown. â€œThe Brawley Police Department thanks the Federal Bureau of Investigations for their assistance.â€
The farming industry is an important source of Imperial Valleyâ€™s economy and producer of agriculture for the nation. Imperial Valley is one of Californiaâ€™s top producers of agriculture, which generates income for local families in the Southern District of California.
SUMMARY OF CHARGES
Wire Fraud â€“ Title 18, U.S.C., Section 1343
Maximum penalty: 20 yearsâ€™ imprisonment and $250,000 fine
Filing a False Tax Return â€“ Title 26, U.S.C., Section 7206(1)
Maximum penalty: 3 yearsâ€™ imprisonment and $250,000 fine
Federal Bureau of Investigation, Imperial County Resident Agency
Internal Revenue Service, Criminal Investigation
Brawley Police Department