John N. Milne pleaded guilty to conspiracy to falsifying the books of United Rentals Inc. while chief financial officer of the Greenwich-based company, with prosecutors recommending a 27-month prison term for the Westport resident.
Judge Ellen Bree Burns is scheduled to sentence Milne in February. He faces up to five years in prison and a $250,000 fine.
As part of a separate settlement with the U.S. Securities and Exchange Commission, Milne agreed to pay $6 million.
According to the FBI, in pleading guilty Milne admitted that he and others falsified URI”™s books by making nearly $13 million in payments to Westport-based Terex Corp. in 2002 and 2003 to cover losses incurred by Terex in a minor sale leaseback agreement.
URI terminated Milne in 2005. In 2007, he led a buyout of the bankrupt Iron City Brewing Co., which this past summer relocated from Pittsburgh to Latrobe, Pa.
“This guilty plea should serve as a warning to other corporate executives that the FBI is vigilant and is working with our federal partners to protect the integrity of our financial markets from manipulative business practices,” said Kimberly Mertz, special agent in charge of the FBI”™s New Haven office, in a prepared statement.
A paralegal was indicted on allegations she helped defraud several banks of $3.5 million by knowingly filing false information on applications for mortgages that later failed.
Norwalk resident Heather Bliss, 34, pleaded not guilty to the charge and was released on $250,000 bond.
Bliss was employed by a Wilton real-estate attorney who prosecutors claim conspired to defraud JPMorgan Chase & Co., IndyMac Bank, and Washington Mutual Bank by submitting falsified applications to obtain mortgages on multiple properties in Fairfield County, in order to develop or sell the properties for profit and pay off other loans carrying high interest rates owed to “hard money” lenders.
Two Fairfield County real-estate agents were charged with illegally negotiating several “short-sale” transactions on properties in Bridgeport and Monroe.
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Norwalk resident Anna McElaney, 38, and Bridgeport resident Sergio Natera, 35, entered not-guilty pleas and were released on $50,000 bonds.
The pair are accused of arranging multiple property sales in which an initial transaction was closed between a property seller and a “straw” buyer at a short-sale price, and then a second transaction between that straw buyer and a legitimate purchaser at a higher price. The indictment alleges that the mortgage lenders did not know about the second closing and received no proceeds from the second closing.
The “silent partner” of convicted Danbury trash hauler James Galante was sentenced to 15 months in jail, and agreed to forfeit interests in Galante”™s businesses valued at up to $5 million.
Mamaroneck, N.Y., resident Thomas Milo, 72, pleaded guilty last February to money laundering in connection with Galante”™s scheme to control hauler routes in western Connecticut and parts of eastern New York through his Automated Waste Disposal and affiliated companies.
Galante is one year into a seven-year prison sentence. The FBI has secured guilty pleas from 33 people in connection with the case.
Alleged Galleon Group under-the-table information source Robert W. Moffat of Ridgefield was arrested recently on insider trading charges. When arrested, he was an IBM computer and semiconductor executive working in Armonk, N.Y.; there was no comment from IBM regarding his future there as of press time. The government alleges Moffat was trafficking in insider IBM facts. The scandal has garnered international headlines with pictures of Galleon principal and billionaire Raj Rajaratnam in handcuffs splashed across front pages and TV screens.
