Husband and Wife Plead Guilty to Roles in $3 Million Fraud Scheme Using Art as Collateral
|U.S. Attorney’s Office March 07, 2012|
DALLAS—Eugenio D. Leo and his wife Jody L. Meyer, formerly of Allen, Texas, pleaded guilty yesterday before U.S. District Judge Ed Kinkeade to their respective roles in a $3 million fraud scheme they ran from February 2004 to November 2004, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
Leo, 30, pleaded guilty to one count of wire fraud and faces five years in prison and a fine of up to $250,000 or twice the loss to the victims. Meyer, 46, pleaded guilty to one count of mail fraud and faces a five-year term of probation and a fine of up to $250,000 or twice the loss to the victims. Both Leo and Meyer, who now reside in Harwood Heights, Illinois, will remain on bond pending sentencing, which is set for June 20, 2012 before Judge Kinkeade.
According to documents filed in the case, during the time of the fraud, Leo worked as a commodities broker at Compass Financial, a commodities brokerage firm located in Richardson, Texas. He devised a mail and wire fraud scheme that involved inducing the victims, K.P. and L.P., to invest their money by making short-term loans to museums in Europe. These loans would be secured by pieces of artwork worth significantly more than the loan value. At Leo’s request, K.P. provided a power of attorney to Leo so that he could make the necessary arrangements for the short-term loan. Leo falsely reported to K.P. that K.P.’s loan was repaid plus interest.
Instead of a short-term museum loan, however, Leo actually purchased art with K.P.’s money, and then sold that art to K.P., never disclosing that he put himself in the purchase chain and made more than $800,000 from the sale. Leo, aided and abetted by Meyer, falsely represented that Leo owned K.P.’s artwork so that Leo could obtain a loan (using the art as collateral) from Art Capital Group for approximately $300,000.
Leo made material misrepresentations to facilitate the scheme to defraud his victims. He used his authority under a power of attorney from the victim to act contrary to the victim’s instructions, contrary to the victim’s best interest and for his own personal benefit. Leo and Meyer defrauded K.P. and L.P. of more than $3 million.
The case was investigated by the FBI. Assistant U.S. Attorneys Aisha Saleem, Paul Yanowitch and Dayle Elieson are prosecuting.