Peoria, IL-(ENEWSPF)- A Bloomington, Illinois couple who owned and operated Wildwood Industries, Inc., Gary and Toni Jo Wilder, pled guilty today to conspiring together, and with others, to defraud more than $213 million from lenders to fund manufacturing equipment which did not exist. Gary, 68, and Toni Jo, 63, both of the 100 block of S. Kreitzer Avenue, Bloomington, Illinois, waived indictment and pled guilty to charges filed by information in a court appearance this afternoon before U.S. District Judge Michael M. Mihm. Sentencing has been scheduled on DATE, 2010.
According to court documents, Gary Wilder was president and 50 percent shareholder of Wildwood; Toni Jo Wilder was corporate secretary and the remaining 50 percent shareholder. Until a change in the company’s accounting software in 2008, Toni Jo Wilder was responsible for accounts payable, accounts receivable and the general ledger.
Wildwood was the subject of an involuntary bankruptcy petition on Mar. 5, 2009. Wildwood’s assets were sold two months later, on May 20, 2009, for approximately $2 million. From 2004 to 2009, Wildwood obtained more than $213 million from approximately 85 lenders.
During today’s court appearance, Gary Wilder pled guilty to conspiracy to commit money laundering (one count), an offense punishable by a statutory maximum of 20 years in prison and fines of up to $500,000 or twice the value of the property involved in the conspiracy; bank fraud (one count), an offense punishable by a maximum 30 years in prison; and, theft from employee benefit plan (one count), which carries a penalty of up to five years in prison. Toni Jo Wilder was charged and pled guilty to one count of conspiracy to commit money laundering.
The charges are the result of an ongoing, cooperative investigation by the Federal Bureau of Investigation; the U.S. Postal Inspection Service; Internal Revenue Service, Criminal Investigation Division; Federal Deposit Insurance Corporation (FDIC); and the U.S. Department of Labor, Office of Inspector General and the Employee Benefit Security Administration. The cases are being prosecuted by Assistant U.S. Attorney Darilynn J. Knauss.
According to court documents and information provided during court proceedings, Wildwood Industries manufactured lawn, leaf and vacuum bags in Bloomington, Illinois. Starting in 2000 and continuing to about April 2009, Gary and Toni Jo Wilder and others defrauded financial institutions and private lenders by providing false information to obtain lease funding for manufacturing equipment which did not exist. Gary and Toni Jo admitted that they and others perpetuated the fraud and concealed the source of funds by using the fraudulently obtained funds to make payment to lenders they owed for earlier lease funding.
Four other individuals have previously waived indictment and pled guilty to criminal charges related to the fraud scheme and are awaiting sentencing: Dominic F. Propersi, of Bloomington, Ill., former plant manager for Wildwood Industries, pled guilty to one count of conspiracy to commit money laundering; Kimberly J. Hill, of Bloomington, a former employee, entered a guilty plea to one count of conspiracy to commit fraud (mail fraud, wire fraud, bank fraud, and theft from employee benefit plan; and, Doyle F. Fry, of Stockton, Missouri, a retired accountant, pled guilty to a single count of conspiracy to commit fraud (mail fraud, wire fraud, bank fraud). Propersi, Hill and Fry each waived indictment and pled guilty before U.S. District Judge Michael M. Mihm in Peoria on Mar. 11, 2010, and are scheduled to be sentenced on Oct. 7, 2010.
William Hudson, of Queensbury, New York, pled guilty in the Northern District of New York to one count of conspiracy to commit money laundering and is scheduled to be sentenced on Aug. 12, 2010. As part of the conspiracy, according to court documents, Gary Wilder admitted he obtained false invoices from W.S. Hudson Converting, in Queensbury, New York. The machinery was not actually purchased but instead was machinery Wildwood Industries already owned. In fact, Hudson Converting did not build or ship any machinery to Wildwood during the course of the fraud scheme. Gary and Toni Jo and others at Wildwood provided Hudson Converting with amounts and descriptions of the machines for the false invoices. The false invoices were provided to brokers who presented the false invoices to lenders to obtain funding.
To further the scheme to defraud, Gary and Toni Jo Wilder admitted that Fry, a Wildwood accountant, was directed to prepare false financial statements, false tax returns, and other false financial record which were designed and used to mislead prospective lenders. Based on the false information, lenders believed Wildwood to be a very profitable company.
After lenders paid Hudson Converting for the non-existent machinery, Hudson Converting kept a portion of the funds and forwarded the balance of the funds to Wildwood’s account. To conceal the nature of the funds, Toni Jo Wilder admitted she directed Hill, a Wildwood employee, to falsely record the incoming wires from Hudson Converting as revenue.
Further, to deceive lenders who sought to inspect their collateral, Gary Wilder directed Propersi, Wildwood’s plant manager, to create false serial number plates and affix them to machinery already owned by Wildwood. On occasion, the machinery was freshly painted so the machinery would appear new.