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Online Vendor Pleads Guilty to $5 Million Postage Fraud Scheme

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SAN DIEGO ­– Cuong H. Nguyen pleaded guilty in federal court today to conspiring to engage in a wide-ranging postage counterfeiting, forging, and tampering scheme that, over the course of multiple years and more than 160,000 packages, deprived the U.S. Postal Service of approximately $5 million of postage due and owing.   

Special Agents from U.S. Postal Inspection Service, IRS Criminal Investigation, and the Financial Investigations and Border Crimes Task Force (the “FIBC” – a multiagency Task Force based in San Diego and Imperial Counties, and funded by the Treasury Executive Office of Asset Forfeiture) led the investigation.

As admitted in the plea agreement entered today before U.S. Magistrate Judge Allison H. Goddard, Cuong digitally altered, counterfeited, forged, and tampered with various “postage evidencing systems”—i.e., postage meters. These postage meters are intended to expedite the delivery and shipment of USPS packages by allowing mailers to purchase and affix postage labels in advance of depositing them into the mail. Nguyen primarily used the postage evidencing system known as Click-N-Ship® when sending packages of beverages and food products from his businesses in San Diego.

As stated in his plea agreement, Cuong admitted that he misrepresented information appearing on postage labels attached to packages in several ways—including misstating the weight, size, destination, and origin of the packages—that were intended to, and in fact did deceive, the USPS as to the underpayment of postage. Accordingly, when the USPS received the packages with labels that Nguyen and others had altered, forged, and counterfeited, they paid much less to the USPS than was owed, but the packages—approximately 162,221 between 2015 and 2019—were delivered anyway.

“Those who defraud the Postal Service are effectively stealing from the U.S. Treasury and the nation’s taxpayers,” said Acting U.S. Attorney Randy S. Grossman.  “We are committed to vigorously investigating and prosecuting these profiteers.”  U.S. Attorney Grossman commended Assistant U.S. Attorney Danny Silva and the U.S. Postal Inspection Service and IRS-Criminal Investigation agents who unraveled this complex, digital crime.

As a result of the conspiracy, Nguyen acknowledged that the underpayment of postage to the USPS was approximately $5,127,712.88, resulting in net profits to Nguyen, his businesses, and others of $862,374.00.

“Postal Inspectors protect the U.S. mail from criminal misuse in a variety of ways, including efforts to root out postage fraud,” stated Inspector in Charge Melisa Llosa of the U.S. Postal Inspection Service Los Angeles Division. “Scammers who selfishly deprive the USPS of revenue place an undue strain on America’s most trusted service. I would like to thank our law enforcement partners, the U.S. Attorney’s Office for the Southern District of California, IRS Criminal Investigation, and the Financial Investigations and Border Crimes Task Force for their assistance in a successful resolution.”

“IRS Criminal Investigation is proud to have worked alongside our law enforcement partners at the USPIS Inspection Service and the FIBC to crack this complex web of digital crime and theft,” said IRS-CI L.A. Field Office Special Agent in Charge Ryan L. Korner. “No matter the venue, stealing money from the U.S. government is stealing money from American taxpayers. Our talented team of special agents and professional staff will continue to work tirelessly to overcome all challenges, including the current pandemic, to ensure that financial crimes will never pay.”

Sentencing is scheduled to occur on July 12, 2021 at 9 a.m. As part of his agreement to plead guilty, Nguyen agreed to forfeit $862,374.00 to the United States, as profits, proceeds, and property obtained directly or indirectly, as the result of the postage fraud conspiracy.

DEFENDANT                                               Case Numbers 21-CR-1131-BAS                                          

Cuong H. Nguyen                                           San Diego, CA                        Age: 37

SUMMARY OF CHARGES

Criminal Conspiracy – Title 18, U.S.C., Section 371

Maximum penalty: Five years in prison, forfeiture, and $250,000 fine

AGENCIES

United States Postal Inspection Service

IRS Criminal Investigation—Financial Investigations and Border Crimes Task Force

*The charges and allegations contained in an indictment or information are merely accusations, and the defendants are considered innocent unless and until proven guilty.



Source: http://criminal-justice-online-courses.blogspot.com/2021/04/online-vendor-pleads-guilty-to-5.html


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