A Catskills businessman who got caught in a $1 million FBI money laundering sting and who has pled guilty to operating an unlicensed money transmitting business has been sentenced to prison for six months.
U.S. District Judge Cathy Seibel also sentenced Daniel “Butch” Resnick, of Glen Wild, Sullivan County, to two years of supervision after his release from prison, Nov. 21 in White Plains federal court. He has already forfeited $310,800 in ill-gotten gains, and the judge ordered him to pay a $100,000 fine.
Resnick’s attorney recommended no prison time, arguing that Resnick is a pillar of the community and was minimally involved in the crime.
Prosecutors recommended one year and a day because “Resnick sought to trade on the legitimacy of his real businesses in exchange for a cut of what he understood to be dirty money.”
The FBI set up the sting in 2019 with a source who had claimed to have discussed money laundering with Resnick, and who was hoping for lenient treatment when he came up for sentencing on his own fraud and bribery charges.
The FBI provided the money. Resnick returned the funds minus a 20% fee.
In August 2019, for instance, an undercover agent posed as a pump-and-dump stock schemer whereby windfall profits were derived from false stock promotions.
The agent pretended to need laundered cash “to take care of the people that are helping us,” according to court records. Resnick went along and laundered checks from $100,000 to $350,000.
White Plains attorney Kerry A. Lawrence depicted a man who deserved lenient treatment for his many good deeds and critical role in the community, in a sentencing memo submitted to the judge.
Resnick dropped out of high school and went to work for his father at Resnick Supermarket Equipment Corp. in Mountaindale. Through sheer hard work he gradually took over the business and expanded it to a $30 million multistate enterprise.
He developed seven more companies, including supermarkets and rental properties, and eventually employed 180 people.
His passion, according to Lawrence, was restoring “forgotten towns” in the Catskills that had fallen into disrepair. He bought and restored run-down buildings and then leased the properties on favorable terms that encouraged new business, created jobs and attracted new residents.
Resnick’s criminal conduct was minimal, Lawrence argued. He had at best a cursory understanding of the scope and structure of the stock scheme and was simply being paid to perform a task.
The benefits of his continuing generosity and the impact on his community, Lawrence said, outweigh the deterrent effect of a prison sentence.
Resnick attributed the “biggest mistake of my life” to desperation, in a letter to the judge.
Even before the Covid-19 pandemic, he was struggling financially, he said. The pandemic was “the final nail in the coffin,” as his customers were no longer building or renovating supermarkets.
“I was desperate to keep my businesses afloat,” he said.
If he were to be imprisoned, Resnick told the judge, all sales would stop, his main business would close and employees would be out on the street.
His request for no prison time was not to protect himself, he said, “but to spare my employees, customers and family any further pain, financial hardship or heartache.”
Resnick does not qualify for credit for a minimal role in the crime, assistant prosecutors James McMahon and Derek Wikstrom stated in a letter to the judge.
Resnick is engaging in misdirection: claiming he did not understand the scope or structure of the pump-and-dump securities fraud.
“There was no actual securities fraud,” they said. “This was a sting.”
The crime is money laundering, they said. Resnick believed he was providing assistance for a complex fraud, helped conceal ill-gotten gains, allowed the purported perpetrators to avoid detection, and personally benefitted from the transactions.
The prosecutors also questioned the notion of pandemic-driven desperation: “Resnick is a multi-millionaire, yet he agreed to launder money in exchange for hundreds of thousands of dollars.
“This is a crime of greed, not necessity.”
Judge Seibel ordered Resnick to surrender to the prison authorities on June 3.
