Pair Indicted in Contract Fraud and Kickback Scheme
CINCINNATI—A federal grand jury has indicted Rudy Rampertab, 45, and Suraj Patel, 34, of Ocoee, Fla. for their alleged connection with a $3.5 million shipping and packaging contract fraud scheme.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, Kathy Enstrom, Special Agent in Charge, Internal Revenue Service Criminal Investigation (IRS), and Kevin Cornelius, Special Agent in Charge, Federal Bureau of Investigation (FBI) announced the charges today.
The indictment charges Rampertab and Patel with one count each of conspiracy to commit mail fraud and honest services fraud, 10 counts each of mail fraud and honest services fraud, 10 counts each of mail fraud, one count each of money laundering, and one count each of conspiracy to commit money laundering.
According to the indictment between 1988 and January 2011 Rampertab was an employee of a business that had offices in Cincinnati, Ohio. This business processed requests for the payment of invoices and mailed checks to vendors to pay for services rendered. Beginning in approximately 2000, Rampertab managed this businesses distribution center located in Carson, Calif. Rampertab supervised the movement of the company’s merchandise to distribution centers throughout the country.
From approximately July 2010 through January 2011, Rampertab and Patel allegedly conspired to divert the shipping and packaging business to companies established by Patel, and part of the profits were paid to Rampertab in the form of kickbacks.
Patel established several companies by the names of SAP Retail Transportation, Cost Plus Packaging, and Keshav Logistics (“Patel’s companies”). Rampertab obtained approval for Patel’s companies to become third party vendors without disclosing his financial interest in or personal connection to Patel’s companies. Rampertab reassigned the transportation contracts from established vendors to Patel’s companies. Rampertab also established a different process for Patel’s companies so that he could personally approve the invoices, according to the indictment.
It has been alleged that Patel’s companies improperly billed the business for services that were not rendered or double-billed the business. In addition, Rampertab and Patel conspired to have Patel’s companies sell large amounts of unnecessary packaging to the business, for which Rampertab approved the invoices.
According to the indictment, between July 2010 and January 2011, Patel’s companies received more than $3.5 million in shipping and packaging contracts from the business. After paying expenses, Patel’s companies generated approximately $1.4 million in net income.
Patel’s companies allegedly paid kickbacks to Rampertab in the form of payments made in the amount of $126,000 to relatives of Rampertab; a $13,000 cashier’s check paid to Rampertab; payments in the amount of over $466,000 to Rampertab’s personal American Express accounts; and Rampertab’s cell phone.
In addition, Patel and Rampertab allegedly used the profits from this scheme and Patel’s companies to purchase real estate and vehicles in their names. Patel used the proceeds of the scheme to purchase a 2010 Aston Martin for $199,000 and sold it $150,000. The $150,000 proceeds were then deposited into a bank account established in Patel’s name and Rampertab was listed as the account beneficiary. Patel and Rampertab used $53,071.13 from that account to purchase property in Orlando, Florida that was titled in both of their names. Also, Patel and Rampertab allegedly used one of Patel’s companies to trade-in Rampertab’s Lexus in order to purchase a BMW. The BMW was purchased with a $61,000 check that was written on one of Patel’s company’s bank accounts.
An indictment is merely an accusation. All defendants are presumed innocent until and unless proven guilty.
Conspiracy to commit money laundering, mail fraud, and honest services fraud are all punishable by up to 20 years in prison and a fine of $250,000. Money laundering is punishable by up to 10 years in prison and a fine of $250,000.
The indictment also contains a forfeiture allegation relative to the forfeiture of jewelry, art work, and six real properties.
“The IRS, along with our law enforcement partners, will vigorously pursue individuals that misuse their positions of trust and use kickback schemes to further their criminal activities,” said Kathy A. Enstrom, Acting Special Agent in Charge, IRS, Criminal Investigation.
U.S. Attorney Stewart acknowledged the investigation by special agents of IRS-Criminal Investigation and the FBI, as well as Assistant United States Attorney Timothy S. Mangan who is representing the United States in this case.