Allentown Man Charged in Fraud Scheme
|U.S. Attorney’s Office November 27, 2012|
PHILADELPHIA—Joseph Paul Beck, 44, of Macungie and Allentown, Pennsylvania, was charged yesterday by information with wire fraud in connection with an investment and loan scam, announced United States Attorney Zane David Memeger. According to the information, between April 2010 and March 2012, Beck devised a scheme for inducing people to purchase “shelf corporations.” Beginning in early 2011, Beck used his own shelf corporation, Washington Integrity Inc., to facilitate the scheme. Beck was the sole owner of Washington Integrity Inc. Washington Integrity had no business except to funnel money from Beck’s scheme into his control. Beck told potential buyers, who were people and companies that could not get funding from ordinary financial institutions, that he could get them loans substantially greater than any available to them from commercial institutions, with the purchase of a shelf corporation from Washington Integrity. Beck’s alleged victims were defrauded of a total of $171,000.
“Shelf corporations” were corporations that had been created some years before but had never engaged in any business and were corporations on paper only. Beck allegedly induced the would-be borrowers to believe that with the purchase of these previously created but dormant corporations they would qualify for private loans, credit cards with high credit limits, and other credit facilities in amounts greater than were otherwise available to them from financial institutions.
It is further alleged that Beck fraudulently misrepresented that the money that customers paid to Washington Integrity for shelf corporations was used to obtain trade references and effect private placement of the loans. Beck falsely told customers that his profit in the transaction would come later, after loans had been funded, from a percentage of the loans he succeeded in acquiring for them. Meanwhile, Beck allegedly used a substantial share of the money to acquire such things as real property; to pay mortgages; and to pay personal credit card bills, grocery bills, and other personal expenses.
If convicted, the defendant faces a maximum possible sentence of 120 years in prison, a fine of $2 million, restitution of $171,000, $800 in special assessments, and forfeiture of any proceeds of the fraud scheme.
The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Pamela Foa.