Tuesday, August 10, 2010

http://www.northjersey.com/news/crime_courts/081010_Montvale_man_sentenced_for_money_laundering_charge_witness_tampering.html 

A Montvale man was sentenced to six years in state prison for his role in a scheme to defraud a produce company’s creditors out of $2 million and witness tampering, the state Attorney General’s Office announced today.

Michael Fava, 53, was sentenced in state Superior Court in Monmouth County to six years in prison on a money laundering charge and four years for witness tampering after pleading guilty to those charges in 2005. The two sentences will be served concurrently.

Fava was also ordered to pay back the victims of the scheme, who lost nearly $2 million, according to the Office of the Attorney General.

Fava and two other co-conspirators ran what the attorney general’s office called a “bust-out” – or planned bankruptcy – scheme.

The three men set up a company called Packed Fresh Produce, Inc. in order to purchase produce on credit and resell it. They then planned to file for bankruptcy in order to avoid paying suppliers, creditors and shippers for the large amounts of produce that they bought and shipped, the attorney general’s office said.

The company received shipments at an unrefrigerated warehouse in Lodi and used a Mail Box Etc. box in Lincroft as a mailing address.

Fava and Joseph Diorio, 48, of Colts Neck, ran businesses in the Paterson Market area and also sold some produce to companies in the Hunts Point Market in New York, the attorney general’s office said.

Diorio was sentenced to 22 years in prison and ordered to pay $2 million to 16 victims in June 2008. A jury convicted Diorio of conspiracy, money laundering, theft by deception and misconduct by a corporate official after a month-long trial in state Superior Court in Monmouth County, according to the Office of the Attorney General.

David Menadier, 53, formerly of Eatontown, previously pleaded guilty to money laundering and perjury and was sentenced to 180 days in jail and two years’ probation, the attorney general’s office said.

Both Menadier and Fava testified against Diorio at his 2008 trial.