Pelham Man Pleads Guilty to Laundering Money in Scam with Daughter
|U.S. Attorney’s Office August 08, 2012|
BIRMINGHAM—A Pelham man pleaded guilty today in federal court to money laundering in a scheme with his daughter that collected more than $400,000 for expenses of a lawsuit that never existed, announced U.S. Attorney Joyce White Vance, Alabama Securities Commission Director Joseph P. Borg, IRS-Criminal Investigation Special Agent in Charge Donald B. Yaden, and FBI Special Agent in Charge Patrick J. Maley.
Paul Haskell Lane, Jr., 69, entered his plea before U.S. District Judge C. Lynwood Smith, Jr. Lane is scheduled for sentencing November 14.
“Today’s guilty plea represents the culmination of years of hard work by my office and our federal and state partners,” Vance said. “Tenacious work by the IRS, FBI, and Alabama Securities Commission made it possible for us to secure this guilty plea,” she said.
“The Alabama Securities Commission was proud to be an integral part of the investigation and legal aspects of this case and to work as a close partner with the U.S. Attorney’s Office, the IRS, and the FBI,” Borg said. “The combined resources and hard work by all agencies has promoted justice and led to this guilty plea.”
“Mr. Lane exploited his family, friends, and neighbors by perpetrating a scheme that was based entirely on lies,” Yaden said. “The plea today is Mr. Lane’s opportunity to admit to the deception and face the consequences of his actions.”
Lane’s guilty plea caps a six-year investigation and prosecution effort by federal and state authorities. In late 2009, Lane and his daughter, Katherine Hope Lane, 28, were separately indicted for wire fraud, mail fraud, and money laundering for their roles in a plan to get people in other states to wire money to Lane’s bank account. Those who sent money were led to believe it would go toward costs for a personal-injury lawsuit filed by the Lane family after Katherine Lane suffered a brutal assault at work.
The Lanes represented that proceeds from the lawsuit would be used to repay people who donated. Most who provided money also believed that they would get back from the Lanes more money than they sent. Katherine Lane, however, was never assaulted, and the Lanes had never filed a lawsuit.
Over the course of several years, Lane took the money that was wired into his account and gave it to his daughter. He acknowledged those actions in his money laundering plea and agreed to pay $343,900 in restitution, which is expected to go toward repaying those who sent money.
Katherine Lane pleaded guilty in 2010 to wire fraud, aggravated identity theft, and money laundering. She was sentenced in 2011 to seven years and three months in federal prison. Katherine Lane also pled guilty to felony state securities fraud charges related to her actions. Her sentence of seven years and three months on the state charges was ordered to run concurrently with the federal sentence.
The Internal Revenue Service, the FBI, and the Alabama Securities Commission investigated the case. Assistant U.S. Attorney Melissa K. Atwood prosecuted the case.