Shelburne man gets 18 months in federal fraud, money-laundering case

A Shelburne man, who created a scheme to defraud multiple companies across the country between 2008 and 2013, is going to prison for 18 months for mail fraud, money laundering and later making false statements to a federal probation officer.

Matthew S. Melvin, 36, of Olde Orchard Lane will be on supervised release for three years once he gets out of a federal prison, under the terms of a plea agreement.

U.S. District Court Judge Geoffrey Crawford ordered Melvin to pay more than $11,000 in restitution, the U.S. Attorney’s Office said. Crawford also assessed Melvin $5,800 in fines and court costs.

After the sentencing in Rutland late last week, prosecutors agreed to drop eight other felony counts, including wire fraud and identity theft, as part of the plea agreement.

The judge actually imposed 18-month sentences on each of the three convictions, but ruled that the jail terms could be served simultaneously.

Records show that Shelburne Police Officer Dan Eickenberg began the investigation into claims Melvin used multiple stolen or assumed identities to apply for various jobs with out-of-state firms involved in the demonstration, marketing and merchandising of products.

The case was later referred to the U.S. Secret Service and the criminal division of the Internal Revenue Service for federal prosecution because of the widespread nature of the fraud.

“Matthew Melvin has demonstrated a chronic aversion to the truth. He repeatedly lied to obtain employment. He commandeered the identities of others to facilitate those lies. He laundered the proceeds from his fraudulently obtained income,” Assistant U.S. Attorney Michael Drescher wrote in his sentencing memo to the court. “And he lied to his probation officer in an effort to hide the fact that he had, again, obtained a job offer by deceit, while subject to the court’s supervision.”

“It is clear that Melvin will go to impressive lengths to try to dupe those tasked with supervising him. Under these circumstances, Melvin presents a threat to the community that he will continue to engage in fraudulent conduct and avoid the supervision of this court,” prosecutors noted in another filing.

Drescher said the federal sentencing guidelines, which are advisory, proposed a prison term between 30 and 37 months.

Defense lawyer Paul Volk proposed a sentence of one year and one day, followed by one year of supervised release and a $5,500 fine. He said the supervised release should include requirements that Melvin seek mental health screening, assessment and counseling.

Volk said Melvin has some psychological issues, including depression and an anxiety disorder, and “has been evaluated as being placed on the adult autism spectrum.”

Volk said Melvin, since being jailed in March, has had a hard time “interfacing with other inmates, corrections officers, counselors and service providers. So too have these individuals apparently had a very difficult time dealing with Mr. Melvin,” Volk wrote in his sentencing memo.

Drescher acknowledged Melvin may have mental health issues, but said the Federal Bureau of Prisons has medical facilities capable of handling any treatment that may needed.

A federal grand jury indicted Melvin on June 16, 2016, on 10 felony counts of mail and wire fraud,  identity theft and money laundering. He denied the charges and was released while awaiting trial.

By early this year, he was back in trouble — making false statements and submitting a bogus letter to a probation officer in an effort to avoid detection.

Officials said Melvin “engaged in a variation of the same scheme for which he had been indicted: submitting a false resume to an employer in order to induce the employer to offer him a job.”

Authorities alleged Melvin impersonated a prospective employer who had supposedly offered him work out-of-state. However, the probation officer speaking on the phone with the alleged prospective employer recognized that Melvin was the person talking, IRS Special Agent John Schroeder said in a court affidavit.

Melvin was arrested on the new charge, false statement, and Magistrate Judge John M. Conroy ordered him detained March 1 while awaiting trial. On July 19 Melvin appeared in federal court and agreed to plead guilty to three of the 11 felonies.

In his 10-page sentencing memo, Drescher stated Melvin has previous state convictions for impersonating a police officer, forgery involving theft of checks through his employment, grand larceny, possession of stolen property, credit card fraud, and identity theft — by stealing credit card information through an employer. The three latest convictions are Melvin’s first felonies at the federal level.

Drescher noted that, when he came under federal investigation in 2011, Melvin was still on state probation for his 1997 convictions for credit card fraud and 2008 conviction for identity theft.

The federal court still needs to determine how much Melvin will forfeit as part of the illegal gains, court papers show. The prosecution believes it should be about $61,040 and mentioned Melvin has more than $200,000 in his bank accounts.

Melvin engaged in a scheme to defraud employers by seeking and obtaining employment by the use of false or stolen identities, officials said. They said he laundered part of the proceeds by withdrawing $43,214 from the Merchants Bank on Nov. 28, 2012 — knowing the money had been obtained through unlawful activity— and the next day opening a new account at the New England Federal Credit Union.

“Melvin’s determination to commit fraud cannot be deterred,” Drescher wrote. “Incarceration appears to be the only effective way to stop Melvin from defrauding others.

“Melvin’s indifferences (and apparent continued indifference) to not only the employers, but also the person whose identity Melvin exploited, was extraordinary. A significant period of incarceration is therefore appropriate.”

Melvin used various identities, including Rodney Smyth, Eric Weiss, Camellia Childress, Tatiana Murray and Andrew Melvin, to dupe the out-of-state employers. Some of the companies were in Michigan, Florida, Colorado and Illinois.

Among the companies getting applications: Big Orange Productions Inc., Castforce Inc., Convergence Marketing, Crossmark Inc., Cyber Group Inc. (doing businesses as Omega Solutions), Dot2Dot Retail Group, Driveline Retail Merchandising Inc., Forney Industries Inc., Lawrence Merchandising Services, Premium Retail Services Inc., Set and Service Resources, and Touchpoint 360.

Melvin used various government documents for his false identities, including a passport, Social Security cards and driver’s licenses from Vermont, Texas and Montana, records show.

Leave a Reply

Shelburne News requires that you use your full name, along with a valid email address. Your email address will not be published, shared, or used for promotional purposes. Please see our guidelines for posting for full details.