Jury Finds Zander Guilty of Fraud, Money Laundering, Tax Charges in Case Involving Scheme to Defraud Paiute Tribe
|U.S. Attorney’s Office March 06, 2013|
SALT LAKE CITY—A jury convicted Jeffrey Charles Zander, age 57, a former tribal planner, general counsel, and economic development and trust resources director for the Paiute Indian Tribe of Utah, of mail and wire fraud, money laundering, and willful failure to file tax returns Tuesday afternoon following a week-long trial in U.S. District Court in Salt Lake City.
Zander was charged with two counts of mail fraud, two counts of wire fraud, one count of money laundering, and three counts of willful failure to file a tax return in a superseding indictment returned in February 2012.
“Prosecuting white-collar crime cases is a high priority for our office. This case is particularly egregious because it involves a person in a position of trust with the Paiute Tribe, who diverted funds intended to help the tribe for his own personal use,” U.S. Attorney David B. Barlow said today.
Zander began working for the Paiute Tribe around October 1998 as its tribal planner. About two years later, he became the tribe’s economic development director and trust resources director. Around September 2007, Zander convinced the tribe to hire as general counsel when, in truth, he did not possess a license to practice law.
Evidence presented at trial showed that beginning in 2005, Zander developed a scheme to divert more than $175,000 for his personal use that had been awarded to the Paiute Tribe through grant proposals the defendant had authored and assisted the tribe in applying for. The grants were awarded for Integrated Resource Management Plans (IRMP), which are long-term plans to balance the use of tribal resources between interests of residents of the reservation and revenue-generating uses of tribal lands. Zander told tribal leaders that he had hired companies in Salt Lake City, Las Vegas, and Provo to act as consultants or facilitators to assist with the creation of the IRMPs. Zander told the tribe that since he would be traveling to work with the consultants or facilitators, he could hand-deliver progress payment checks to the companies.
Evidence at trial showed the companies were bogus—created by the defendant to facilitate the fraud. Zander created fictitious invoices from the companies, submit them for payment from the tribe, and then drove to different points between Provo, Utah and Mesquite, Nevada, to deposit the checks into his personal bank accounts. He also drafted quarterly reports for the Bureau of Indian Affairs to show that the money was being spent for facilitators and consultants when, in truth, he had converted grant funds for his own use.
The scheme came to light when a transaction raised a red flag with a bank teller and, at about the same time, tribal leaders started to uncover the defendant’s deceit and misrepresentations. Evidence showed that invoices from all four companies were found on his work computer. Zander was fired from his tribal position and the case was turned over to the FBI.
“This defendant devised a scheme that caused the Paiute Nation to suffer substantial financial losses over a period of many years. I appreciate the IRS-Criminal Investigation Division, the FBI special agents, and the United States Attorney’s Office for their dedicated work on this case. I believe this investigation highlights law enforcement’s ongoing commitment to investigating and prosecuting criminal activity on Native American lands in Utah,” Mary F. Rook, Special Agent in Charge of the FBI in Salt Lake City said today.
“This serves as a strong message to those in positions of trust who put greed over duty. All income is reportable, including amounts you unlawfully obtain from others. Don’t think using bogus entities and shell companies is going to conceal your activities from an agency with over 93 years of refining the art of following the money. Such acts will only serve to incriminate you more,” Paul Camacho, Special Agent in Charge of IRS Criminal Investigation, said.
As a part of the criminal case, federal prosecutors are seeking a money judgment of $176,698 representing the approximate value of the proceeds obtained by Zander as a part of the scheme.
Sentencing in the case is set for July 31, 2013, at 2 p.m. before U.S. District Judge David Nuffer. The potential maximum penalty each count of mail and wire fraud is 20 years. The money laundering count has a potential 10 years penalty, and each count of failure to file a tax return has a potential one-year penalty.
The case was prosecuted by the U.S. Attorney’s Office in Salt Lake City and investigated by special agents of the FBI and the IRS-Criminal Investigation Division.