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BANKRUPTCY FRAUD CASE

Bankruptcy petitioner admits concealing real estate assets

News Release U.S. Department of Justice United States Attorney District of Rhode Island October 18, 2006 Bankruptcy petitioner admits concealing real estate assets Richard M. Cecca pleaded guilty today to bankruptcy fraud, admitting that he made false statements and concealed real estate assets in a bankruptcy filing. Cecca failed to disclose his ownership interest in about 20 parcels of real estate in Rhode Island. United States Attorney Robert Clark Corrente announced the guilty plea, which Cecca entered before U.S. District Court Judge Mary M. Lisi in U.S. District Court, Providence. The prosecution of Cecca was part of Operation Truth or Consequences, a national initiative targeting bankruptcy fraud. Deputy Attorney General Paul J. McNulty and other federal government officials unveiled Operation Truth or Consequences in Washington today. At the plea hearing in Providence, Assistant U.S. Attorney Richard W. Rose said that the government could prove that Cecca engaged in two principal types of bankruptcy fraud: he failed to disclose assets in his bankruptcy petition and failed to disclose the sale of assets after the petition was filed. Most of Cecca’s assets were in the form of real estate owned by corporations that he controlled and notes and mortgages owed to those corporations. The total amount of assets that he concealed was between $400,000 and $1,000,000. On September 21, 2001, at a Meeting of Creditors in connection with his bankruptcy filing, Cecca falsely stated that RGM, LLC, a Rhode Island limited liability corporation in which he held an interest, did not have any assets, when in fact RGM owned real estate in -more-
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Providence at 12 Halton Street, 63 Wendell Street, and 208 Admiral Street, and at 14 Hare Street, West Warwick. At the same meeting, Cecca falsely stated that Nu-Future Investment Corporation, a Massachusetts Corporation in which he held an interest, did not own any property, when in fact Nu-Future owned, among other things, real estate located at 26 Inkerman Street, Providence. Nu-Future did business in Rhode Island under a fictitious name, Domani Corporation. Cecca admitted today that, when he filed for bankruptcy in August 2001, he falsely stated that Nu-Future had no market value, when it actually held several pieces of real estate, including property at 132 Laban Street, Providence. Cecca also failed to disclose his interest in Bos-Ten, LLC, a Rhode Island limited liability corporation, and that Bos-Ten owned real estate in Providence at 110 Bowdoin Street, 17 Erastus Street, and 133 Early Street, and at One Mill Pond Road, North Kingstown. Cecca also failed to disclose real estate assets and mortgages owed to RGM, LLC, a Rhode Island limited liability corporation in which he held an interest. Cecca, 53, of Plymouth, Massachusetts, pled guilty to six counts of bankruptcy fraud, which has a maximum penalty of five years imprisonment and a $250,000 fine. He is free on $75,000 surety bond pending sentencing, which Judge Lisi scheduled for February 2, 2006. The Federal Bureau of Investigation investigated the case, with assistance from the United States Bankruptcy Trustee. Operation Truth or Consequences Operation Truth or Consequences, which Deputy Attorney General McNulty announced in Washington today, includes charges filed against 78 individuals in 69 separate prosecutions alleging concealment of more than $3 million in assets. In addition to bankruptcy fraud, -more-
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charges filed include use of false Social Security numbers and false identities; submission of forged documents and use of false statements; defrauding of individuals whose homes were in foreclosure; and fraudulent receipt of government loans and benefits. Defendants include nine attorneys, two bankruptcy petition preparers, and one former law enforcement officer. An indictment is merely an allegation and a defendant is presumed innocent unless and until proven guilty. The Department of Justice also announced a new Internet hotline for reporting suspected bankruptcy fraud to the U.S. Trustee Program, which is the Department’s component that promotes and protects the integrity of the bankruptcy system. Suspected bankruptcy fraud can be reported via email, to USTP.Bankruptcy.Fraud@usdoj.gov. Operation Truth or Consequences is a joint criminal enforcement effort by the U.S. Attorneys’ Offices, the U.S. Trustee Program, the FBI, the Department of Housing and Urban Development Office of Inspector General, the Social Security Administration Office of Inspector General, the U.S. Postal Inspection Service, the Internal Revenue Service Criminal Investigation, and the U.S. Secret Service. -30- Contact: 401-709-5032 Thomas.connell@usdoj.gov Find news information on the U.S. Attorney’s Web site: http://www.usdoj.gov/usao/ri/

Bankruptcy Basics - For Cases Filed on or after October 17, 2005 (pdf)
Bankruptcy Basics - For Cases Filed before October 17, 2005 (pdf)

   

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