Former State Trooper Pleads Guilty to Fraud, Witness Tampering

COLUMBUS—Former Ohio State Highway Patrol Trooper Benjamin W. Richardson, 46, of Powell, pleaded guilty in U.S. District Court to an eight-count indictment charging him with mortgage fraud, bankruptcy fraud, and witness tampering.

Carter M. Stewart, United States Attorney for the Southern District of Ohio; Edward J. Hanko, Special Agent in Charge, Federal Bureau of Investigation (FBI), and Anthony Marotta, Assistant Special Agent in Charge, Drug Enforcement Administration (DEA), announced the pleas entered today before U.S. District Judge Gregory L. Frost.

FBI agents arrested Richardson on September 6, 2011 based on similar charges in a criminal complaint. He has been in custody since his arrest. The indictment was returned on September 8, 2011 under seal and has since been unsealed. Richardson was a trooper with the Ohio State Highway Patrol when he was charged and resigned when the charges were returned.

“A federal investigation revealed that Richardson engaged in a scheme to enrich himself and avoid personal liabilities,” an FBI agent testified during the hearing.

Richardson admitted that, in 2005, he engaged in a conspiracy to defraud mortgage lending institutions out of $678,275 in loans by means of false and fraudulent pretenses involving three properties he was buying and the refinancing of his own home. Richardson also admitted to falsely under-reporting his income when he filed for bankruptcy in 2007 by not disclosing income he received from a nightclub he owned at the time.

Richardson pleaded guilty to one count of conspiracy to commit wire fraud and four counts of wire fraud. Each crime is punishable by up to 30 years in prison. He also pleaded guilty to two counts of making false statements and false oaths in bankruptcy. Each count is punishable by up to five years in prison. Richardson also pleaded guilty to one count of witness tampering for attempting to prevent a witness from talking with law enforcement during the investigation. Witness tampering is punishable by up to 20 years in prison.

Stewart commended the cooperative investigation of this case by FBI and DEA agents, and Assistant U.S. Attorneys Doug Squires and Laura Denton, who are prosecuting the case.

Judge Frost will schedule a date for sentencing.

Former Baseball Player Lenny Dykstra Indicted by Federal Grand Jury in Bankruptcy Fraud Case

LOS ANGELES—Celebrity athlete Lenny Dykstra, an All-Star outfielder who played for the New York Mets and Philadelphia Phillies, was indicted today by a federal grand jury that accused him of bankruptcy fraud for allegedly selling items from his $18 million mansion in Ventura County.

Lenny Kyle Dykstra, 48, who was known by the nickname “Nails” and is currently residing in Murietta, California, was named in a 13-count indictment returned this afternoon.

The indictment accused Dykstra of one count of bankruptcy fraud, one count of obstruction of justice, four counts of concealing property from the bankruptcy estate, three counts of embezzlement from the bankruptcy estate, and four counts of making false declarations to the Bankruptcy Court.

The indictment is the result of conduct Dykstra allegedly engaged in after filing a bankruptcy case on July 7, 2009. The indictment alleges that after filing the bankruptcy protection, Dykstra looted his Sherwood Estates mansion, lied about who stripped the mansion, and denied receiving money for having sold items that were owned by the Bankruptcy Estate.

According to court documents, an attorney hired by the bankruptcy trustee estimates that Dykstra stole and destroyed more than $400,000 worth of property in the estate.

An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty.

All of the charges in the indictment carry a statutory maximum penalty of five years in federal prison, except for obstruction of justice, which carries a potential sentence of up to 20 years in prison. Therefore, if he is convicted of all 13 counts in the indictment, Dykstra would face a maximum possible penalty of 80 years in prison.

Dykstra’s bankruptcy case is still pending in United States Bankruptcy Court in Woodland Hills.

The investigation in the bankruptcy fraud case was conducted by the Federal Bureau of Investigation and IRS - Criminal Investigation. The United States Trustee for the Central District of California (Region 16) provided substantial assistance during the investigation.

“The bankruptcy-related conduct charged in the indictment constitutes an egregious abuse of the bankruptcy system and will not be tolerated,” stated Peter C. Anderson, U.S. Trustee for Region 16. The U.S. Trustee Program is the component of the Justice Department that protects the integrity of the bankruptcy system by overseeing case administration and litigating to enforce the bankruptcy laws.

CONTACT:

Assistant United States Attorney Evan Davis

Major Frauds Section

(213) 894-4850

Assistant United States Attorney Aaron May

Major Frauds Section

(213) 894-0363

Release No. 11-064

Former MLB Star Lenny Dykstra Charged in Bankruptcy Fraud Case That Alleges Sale of Items from Mansion

LOS ANGELES—Lenny Dykstra, former celebrity who played outfield for the New York Mets and Philadelphia Phillies baseball clubs and later gained notoriety as a stock picker, has been charged with bankruptcy fraud for allegedly selling items from his $18 million mansion in Ventura County.

Lenny Kyle Dykstra, 48, who is currently residing in Encino, was named in a one-count criminal complaint filed Wednesday that accuses Dykstra of one count of embezzling from a bankruptcy estate.

The federal criminal case against Dykstra was announced today after he was taken into custody last night at his residence by local authorities on unrelated charges.

The federal charges stem from a bankruptcy case that Dykstra filed on July 7, 2009. The criminal case filed in United States District Court alleges that Dykstra removed, destroyed, and sold property that was part of the bankruptcy estate without the permission of the bankruptcy trustee.

According to court documents, after Dykstra filed for bankruptcy, he sold many items belonging to the bankruptcy estate for cash, as well as destroying and hiding other items. An attorney hired by the bankruptcy trustee estimates that Dykstra stole and destroyed more than $400,000 worth of property in the estate, according to the criminal complaint.

When Dykstra filed for bankruptcy, he listed two residences—a mansion in Lake Sherwood Estates purchased from Janet and Wayne Gretzky that he estimated was worth $18.5 million, and a home in Westlake Village that he estimated was worth $5.4 million. As a result of the bankruptcy filing, the residences and Dykstra’s personal property became part of the bankruptcy estate that would be used to pay off creditors. Even though Dykstra was prohibited from liquidating any part of the estate, the investigation showed that:

About a month after filing for bankruptcy, Dykstra was paid cash at a Los Angeles consignment store for personal items, including a truckload of furnishings and fixtures that he had taken from the Lake Sherwood mansion; Dykstra admitted in a bankruptcy hearing to having arranged the sale of sports memorabilia and a dresser that were property of the bankruptcy estate; and Dykstra “ripped out” a $50,000 sink from his mansion and took granite from the mansion and installed it in an office he set up at the Camarillo airport after he had filed for bankruptcy protection.

A criminal complaint contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty.

The charge of bankruptcy fraud carries a statutory maximum sentence of five years in federal prison.

Dykstra’s bankruptcy case is still pending in United States Bankruptcy Court in Woodland Hills.

The investigation in the bankruptcy fraud case was conducted by the Federal Bureau of Investigation and IRS - Criminal Investigation. The United States Trustee for the Central District of California (Region 16) provided substantial assistance during the investigation.

CONTACT:

Assistant United States Attorney Evan Davis

Major Frauds Section

(213) 894-4850

Assistant United States Attorney Aaron May

Major Frauds Section

(213) 894-0363