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Tuesday, April 30, 2019

Russian National Sentenced to 18 Months in Prison for Conspiring to Act as an Agent of the Russian Federation Within the United States


            WASHINGTON – Mariia Butina, a Russian national, was sentenced today to 18 months in prison after earlier pleading guilty to a federal charge of conspiracy to act as an agent of a foreign government.

            The announcement was made by Assistant Attorney General for National Security John C. Demers, U.S. Attorney for the District of Columbia Jessie K. Liu, and Assistant Director in Charge Nancy McNamara of the FBI’s Washington Field Office.

            Butina, 30, a Russian citizen who had been residing in Washington D.C., pled guilty on Dec. 13, 2018, in the U.S. District Court for the District of Columbia.  She was sentenced by Judge Tanya S. Chutkan.  Following her incarceration, she is to be deported to Russia.

            According to the government’s evidence, from approximately 2015 to 2017, Butina acted as an agent of a Russian government official.  Under his direction, she provided key information about Americans who were in a position to influence United States politics and took steps to establish an unofficial line of communication between Russia and these Americans.  As described in the plea documents, Butina sought to do so for the benefit of the Russian Federation. She took these actions without providing the required notifications to the Attorney General that she was in fact acting as an agent of the Russian Federation.

            Butina was arrested on July 15, 2018, in Washington, D.C., and has been in custody ever since.  Butina will get credit for the time she already has served.  The court also granted a government motion that led to a reduced sentence in the case.

            The investigation into this matter was conducted by the FBI’s Washington Field Office. The case was prosecuted by Assistant U.S. Attorneys Erik M. Kenerson, Thomas N. Saunders, and Jolie Zimmerman of the National Security Section of the U.S. Attorney’s Office for the District of Columbia, and Trial Attorney William A. Mackie of the National Security Division of the U.S. Department of Justice.

Two Men Sentenced For Illegal Sports Gambling


BOSTON – Two Massachusetts men were sentenced in federal court in Worcester in connection with operating separate illegal sports gambling businesses.

Keith Bianchini, 40, of Holden, was sentenced today by U.S. District Court Judge Timothy S. Hillman to two years of probation, with the first six months to be served on house arrest, and ordered to pay a $10,000 fine and $56,000 in forfeiture. In January 2019, Bianchini pleaded guilty to one count of operating an illegal gambling business.

According to court documents, Bianchini’s bookmaking operation used an offshore website to place and track wagers on National Football League games and other sporting events.  During the time that Bianchini managed the gambling business, he oversaw various agents who recruited bettors and met face-to-face with bettors to collect cash payments associated with losing bets. While operating the bookmaking business, Bianchini was a correctional officer with the Massachusetts Department of Correction.

On Monday, April 22, Anthony Seariac, 38, of Framingham, was sentenced to two years of probation, to include six months of home confinement, and ordered to pay a $10,000 fine and $92,000 in forfeiture. In January 2019, Seariac pleaded guilty to one count of operating an illegal gambling business.

According to court documents, Seariac operated an illegal sports gambling business that utilized an offshore website to place and track wagers on National Football League games, National Basketball Association games, National College Athletic Association football and basketball games, and other sporting events. Seariac managed and oversaw more than 10 agents who recruited bettors and met face-to-face with bettors to collect cash payments associated with losing bets. Seariac failed to pay federal or state taxes on his gambling income.

United States Attorney Andrew E. Lelling; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Office; and Colonel Kerry Gilpin, Superintendent of the Massachusetts State Police, made the announcement today. Assistant U.S. Attorney Bill Abely of Lelling’s Criminal Division prosecuted the cases.

Real Estate Developer from Palm Beach, Florida Admits Role in Investment Fraud, Bank Fraud, Money Laundering and Tax Evasion Schemes


John H. Durham, United States Attorney for the District of Connecticut, Brian C. Turner, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation, and Kristina O’Connell, Special Agent in Charge of the Internal Revenue Service – Criminal Investigation in New England, announced that ROBERT V. MATTHEWS, 61, of Palm Beach Florida, pleaded guilty today in Bridgeport federal court to conspiracy, money laundering and tax evasion offenses related to multiple schemes to defraud foreign investors and financial institutions.  In addition, Matthews’ wife, MARIA MATTHEWS, 52, pleaded guilty today in Bridgeport to tax evasion.

According to court documents and statements made in court, Robert Matthews was a real estate developer in charge of The Palm House Hotel (“PHH”), a property that he sought to develop in Palm Beach.  Robert and Maria Matthews maintained residences in both Florida and Connecticut.

The EB-5 visa program is a federal program by which foreign nationals and their families are eligible to apply for lawful permanent resident status (commonly known as a “green card”) if they meet certain requirements by investing in a development project in the U.S.  Various entities in the U.S. act as intermediaries between potential foreign investors and investment projects.  One such entity, South Atlantic Regional Center, LLC (“SARC”) in Palm Beach, Florida, advertised EB-5 projects to foreign investors, collected funds from foreign investors that were earmarked for certain development projects, and made the funding available to the respective development project.

The PHH was a development project advertised by SARC to EB-5 investors between approximately 2012 and 2014.  Robert Matthews purchased the PHH property in August 2006, and then lost the property in foreclosure in 2009.  In August 2013, Robert Matthews reacquired control of the property through an entity called Palm House, LLC.  However, Robert Matthews’ brother, Gerry Matthews, was listed in incorporation documents as owning 99 percent of Palm House, LLC, and another individual, who had secured additional financing for Robert Matthews, was listed as owning the remaining 1 percent.

In pleading guilty, Matthews admitted that he and others defrauded EB-5 investors by representing that funds from EB-5 investors would be used to develop the PHH; that certain well-known individuals would be on the PHH advisory board and certain well-known entertainers, businesspeople and politicians “will be a part of the club”; and that Gerry Matthews was a member of the Palm House, LLC management team and was the 99 percent owner of the project.  EB-5 investors invested in the PHH project by providing money to bank accounts controlled by SARC.  SARC, in turn, provided EB-5 money earmarked for PHH use into accounts controlled by Robert Matthews and his associates.

While Gerry Matthews was the nominal 99 percent owner of Palm House, LLC, Robert Matthews controlled the company.  Robert Matthews and other used EB-5 funding for purposes not related to the PHH project, including for Robert and Maria Matthews’ personal gain.  In addition, there was no evidence any of the proffered well-known individuals would be on the PHH advisory board or would be members of the club.

As part of this scheme, Robert Matthews and others moved investor funds through various bank accounts located in Connecticut and Florida.  The funds were used to pay Robert and Maria Matthews’ credit card debts, and to purchase two properties located in Washington Depot, Connecticut.  One of the Washington Depot properties was a property that Robert Matthews had previously lost in foreclosure.  Robert Matthews, Nicholas Laudano and others conspired to purchase the property out of foreclosure by concealing both the relationship between the co-conspirators, and the source of the funds used to purchase the property.

Laudano is a construction contractor who continuously worked on the development of the PHH project between approximately 2006 and 2016.  He also has operated several restaurants in Florida and Connecticut.

Since approximately 2008, Robert and Maria Matthews willfully attempted to evade paying federal income tax they owed for the 2005 and 2007 calendar years in multiple ways, including by using limited liability companies, a company bank account, and their attorney’s trust account to pay for personal expenses.  For example, in approximately November 2014, Robert Matthews caused Maria Matthews to execute documents to obtain a loan from an individual with the initials K.M.  The loan was secured by one of their Washington Depot properties, which, at the time, was in the name of a shell company.  The proceeds of this loan were eventually disbursed into an account controlled by the Robert and Maria Matthews in the name of Mirabia LLC.  Robert and Maria Matthews subsequently used the loan proceeds for personal expenses without paying any of their outstanding tax liability.

The investigation also revealed that, between approximately 2007 and 2009, Robert Matthews conspired with others in a scheme to defraud T.D. Banknorth, N.A. (now TD Bank, N.A.), out of the proceeds of a construction loan by making material misrepresentations to the bank in connection with the development of the Point Breeze Hotel in Nantucket, Massachusetts.  In addition, in June 2010, Robert Matthews conspired with others in a scheme to defraud TD Bank out of its ability to foreclose on another parcel of property in Nantucket owned by Matthews.

Finally, in pleading guilty, Robert Matthews admitted that, between approximately December 2010 and January 2013, he conspired with others to defraud JP Morgan Chase Bank N.A. by misappropriating insurance proceeds earmarked for repair of one of his Washington Depot properties.

Robert Matthews pleaded guilty to one count of conspiracy to commit bank fraud and wire fraud, an offense that carries a maximum term of imprisonment of 30 years; one count of illegal monetary transactions, an offense that carries a maximum term of imprisonment of 10 years, and one count of tax evasion, an offense that carries a maximum term of imprisonment of five years.

Maria Matthews, who is also known as “Mia Matthews,” pleaded guilty to one count of tax evasion.

Robert and Maria Matthews are released on bonds pending sentencing.  Sentencing dates are not scheduled.

On March 7, 2018, Gerry Matthews, of Middlebury, Connecticut, pleaded guilty to one count of conspiracy to commit wire fraud.  On March 12, 2018, Laudano, of Boynton Beach, Florida, pleaded guilty to one count of conspiracy to commit bank fraud and one count of illegal monetary transactions.  They await sentencing.

This matter is being investigated by the Federal Bureau of Investigation and the Internal Revenue Service – Criminal Investigation Division.  The case is being prosecuted by Assistant U.S. Attorneys John T. Pierpont, Jr. and David E. Novick.