Columbia University Fraud Suspects Found Guilty by Jury
By Chris Dolmetsch – Aug 8, 2012 9:56 AM ET.
Four men accused of the theft of more than $5 million from New York’s Columbia University were convicted of all counts against them after a jury trial, Manhattan District Attorney’s Cyrus Vance Jr.’s office said.
George Castro, 50, of the Bronx, Walter Stephens Jr., 66, of Jersey City, New Jersey, Jeremy Dieudonne, 47, of Lawrence, Massachusetts, and Joseph Pineras, 35, of the Bronx, were convicted yesterday of grand larceny and other charges after a two-week trial before New York State Supreme Court Justice Robert Stolz in Manhattan.
The four men were accused of stealing $5.7 million from the Ivy League school in October and November 2010 by redirecting payments from Columbia that were intended for New York Presbyterian Hospital. Pineras, an accounts payable clerk at Columbia, was the only defendant who worked for the university.
“Fraud by insiders against an institution dedicated to the public good is egregious and will be prosecuted vigorously by this office,” Vance said in a statement. “Like so many cyber fraud cases my office prosecutes, this scheme was set in motion by an ’insider,’ who made the larger theft of $5.7 million possible.”
Castro, Dieudonne and Stephens, with the help of Pineras’access to the school’s vendor payment system, redirected payments for the hospital into a TD Bank account registered to IT & Securities Solutions LLC, a company formed by Castro, Vance’s office said. Stephens was the chief financial officer and Dieudonne was an executive at IT, prosecutors said.
Castro withdrew more than $800,000 in cash from the account and spent at least $80,000 on an Audi Q7 and more than $18,000 on products from Apple Inc., prosecutors said.
He sent money to other accounts in Stephens’ name and to brokerage accounts controlled by himself and Stephens, and sent payments to a bank account in the name of Dieudonne Partners & Co., according to the statement.
Castro lost about $400,000 trading on the two accounts, Vance’s office said.
Castro was arrested in November 2010 outside his home with $200,000 cash while entering his Audi, prosecutors said. Stephens was arrested in June 2011, Dieudonne was apprehended inMassachusetts the following month and Pineras was taken into custody in January.
The four men face a maximum of 25 years in prison at sentencing, which is scheduled for Sept. 24.
The judge asked prosecutors to identify how much of the $5.7 million has been recovered before the sentencing. Vance’s office said at the time of Castro’s arrest that at least $4.1 million of the $5.7 million had been identified, frozen or seized.
Pineras was freed on $5,000 bail after the verdict while the other three men were remanded to jail pending sentencing, Vance’s office said.
Attorneys for Castro and Stephens didn’t return telephone messages seeking comment on the verdict. Dieudonne represented himself. Robert Hornsby, a spokesman for Columbia University, declined to comment in an e-mail.
“I was very disappointed, because, in my opinion, my client is innocent,” Pineras’ attorney, Robert Anesi, said in a telephone interview yesterday. “There was no corroboration of the testimony of his former coworker.”
The former coworker at Columbia, Moise Jean-Paul, who testified against the four men, pleaded guilty to grand larceny and agreed to cooperate with prosecutors in exchange for a recommendation of no jail time, Anesi said.
“The question is, whose version of the truth do you believe?” Anesi said.
Jean-Paul’s attorney, Anthony Martone, didn’t return a telephone message left at his office seeking comment on his client. Vance’s office declined to comment on Jean-Paul’s case, saying information about cooperators isn’t public.
The case is People v. Castro, 11-02922, New York State Supreme Court, New York County (Manhattan).
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