Accountant Sentenced in Million-Dollar Fraud Scheme
PHILADELPHIA—Andrew B. Zelenkofske, 54, an accountant, of Chagrin Falls, Ohio, was sentenced today to 36 months in prison for defrauding former clients of over $1 million. Between January 2009 and May 2012, he defrauded three of his victims by soliciting funds from them to invest in a start-up biotechnology company. Instead of investing the victims’ money as he represented, Zelenkofske used the funds to pay his own business expenses in connection with a failing restaurant he owned.
Between April 2011 and July 2012, Zelenkofske defrauded another victim, also a former client, of $237,000 by falsely representing that she owed income taxes when she did not and soliciting from her a loan amount which he knew he could not repay. He also spent this victim’s money to pay expenses related to his restaurant. In 2010 and 2011, Zelenkofske defrauded a group of business associates of at least $137,254 by concealing the payment of a dividend and using the funds belonging to these investors to pay his own business expenditures.
Finally, in November 2013, Zelenkofske attempted to obstruct the administration of the internal revenue laws by falsifying a Release of Levy form which he transmitted to the IRS in connection with the representation of a client.
In addition to the prison term, U.S. District Court Judge Stewart Dalzell ordered $987,050 in restitution, three years of supervised release and a $500 special assessment.
The case was investigated by the Federal Bureau of Investigations, the Internal Revenue Service Criminal Investigations and the Treasury Inspector General for Tax Administration. It was prosecuted by Assistant United States Attorney Terri A. Marinari.