Former USA Drug Vice President of Advertising Pleads Guilty to Mail Fraud and Money Laundering Charges
|U.S. Attorney’s Office May 02, 2012|
LITTLE ROCK—Christopher R. Thyer, United States Attorney for the Eastern District of Arkansas, announced that Garret Sorensen, age 42, of North Little Rock, Arkansas, a former vice president of advertising for USA Drug, entered a plea of guilty today to one count of mail fraud and one count of money laundering. Sorensen’s trial, which was scheduled to begin this morning before United States District Judge Billy Roy Wilson, was delayed while the parties conducted plea negotiations and finalized an agreement. The remaining 31 counts against Garrett Sorensen were dismissed.
The fraud charges stem from transactions made by Sorensen between 2005 and 2007. During this time, Garret Sorensen was employed by USA Drug as the vice president of advertising. In late 2005, Sorensen, Katherine Sorensen, and Shannon Walters formed Multi-Media Management (MMM), which they represented to be a media placement company. Garret Sorensen then began to funnel all insert and direct mail advertising for USA Drug through MMM. Sorensen did not notify USA Drug management of his interest in, and operation of, MMM. By funneling the insert and direct mail advertising through MMM, Sorensen was able to obtain a profit of approximately $500,000. This was accomplished by overstating insert quantity, billing for inserts that were not placed, and by charging USA Drug an inflated “service fee.” In addition, Sorensen included in MMM bills charges for the direct mailing of advertising materials for which no service charges had ever been paid by USA Drug before.
Over $248,000 of the MMM proceeds were dispersed directly to or for the benefit of Garret and Katherine Sorensen. With those funds, the Sorensens purchased, among other things, a boat, a Jeep, a Rolex watch, and a Chevrolet Suburban. The purchase of the boat from Bradford Marine served as the basis for the money laundering charge to which Sorensen pled guilty.
The maximum statutory penalty for mail fraud is 20 years’ imprisonment. The maximum statutory penalty for money laundering is 10 years’ imprisonment. Sorensen faces a potential fine of $250,000 for each count.
Sentencing has been scheduled for Friday, September 7, 2012, at 1:30 p.m.
The charges against Katherine Sorrensen and her sister, Shannon Walters, were dismissed by separate agreement.
The investigation was conducted by the Little Rock Field Office of the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigation Division. The case was prosecuted by Assistant United States Attorney Patricia Harris, Angela Jegley, Patrick C. Harris, and Jane W. Duke.