Former State Senator James E. Doyle, II, 46, of Pawtucket, was charged by way of an information with thirty-one counts of bank fraud and one count each of filing a false tax return and failing to file a tax return.
The owner of two Rhode Island durable medical equipment companies has been charged in federal court in Providence with allegedly executing a “check-kiting” scheme which defrauded three banks, and with tax evasion, according to the U.S. Attorney's office.
Doyle resigned as a Rhode Island state senator in January 2018 triggering a special election. Sandra Cano won the seat in a special election.
At the time, Doyle claimed he was resigning to deal with an addiction problem.
The filing of an information and plea agreement in this matter is announced by United States Attorney Stephen G. Dambruch, Kristina O'Connell, Special Agent in Charge, Internal Revenue Service Criminal Investigation, and Harold H. Shaw, Special Agent in Charge of the FBI Boston Division.
His father was a long-time serving Mayor of Pawtucket.
According to court documents, it is alleged that beginning in as early as 2013, and lasting until February 2016, Doyle, as owner of Doyle Respiratory, LLC and Doyle Sleep Solutions, LLC, executed a check-kiting scheme that defrauded three banks.
“Check-kiting” consists of drawing checks on an account in one bank and depositing them in an account in a second bank when neither account has sufficient funds to cover the amounts drawn. Just before the checks are returned for payment to the first bank, the kiter covers them by depositing checks drawn on the account in the second bank. Due to the delay created by the collection of funds by one bank from the other, known as the “float” time, an artificial balance is created.
It is alleged that over three years Doyle created inflated balances in checking accounts at three banks by writing tens of thousands of checks in order to obtain funds which otherwise would not have been available to him. It is alleged that on a single day in February 2016, Doyle deposited thirty-one worthless checks totaling approximately $300,000 into one bank drawn from a checking account at a different bank. There were insufficient funds in the accounts to cover the checks.
According to court documents, Doyle defrauded the banks of between $250,000 and $550,000.
It is also alleged in court documents that in tax year 2015, Doyle and his spouse failed to report to the IRS $326,862 in income received from the check-kiting scheme and his businesses, and that he failed to file a tax return for tax year 2016 in which he received gross income of $255,812, according to the government's press statement.
According to court documents, the tax loss to the IRS for tax years 2013 thru 2016 amounts to $305,426. In total, Doyle and his wife failed to report more than $1 million dollars in income.
An information is merely an allegation and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Bank fraud is punishable by statutory penalties of up to thirty years in federal prison, a term of supervised release of up to five years, and a fine of up to $1,000,000. Filing a false tax return is punishable by statutory penalties of up to three years in federal prison, a term of supervised release of up to one year, and a fine of up to $250,000 or twice the pecuniary gain or loss. Failure to file a tax return is punishable by statutory penalties of up to one year in federal prison, a term of supervised release of up to one year and a fine of up to $100,000.
The matter was investigated by Internal Revenue Service Criminal Investigation and the Federal Bureau of Investigation.
The case is being prosecuted by Assistant U.S. Attorney Dulce Donovan.
This article was first published 8/16/18 4:33 PM
Related Slideshow: Rhode Island’s History of Political Corruption
Vincent A. "Buddy" Cianci resigned as Providence Mayor in 1984 after pleading nolo contendere to charges of assaulting a Bristol man with a lit cigarette, ashtray, and fireplace log. Cianci believed the man to be involved in an affair with his wife.
Cianci did not serve time in prison, but received a 5-year suspended sentence. He was replaced by Joseph R. Paolino, Jr. in a special election.
Joseph Bevilacqua was RI Speaker of the House from 1969 to 1975, and was appointed as Chief Justice of the State Supreme Court in 1976. It was alleged that Bevilacqua had connections to organized crime throughout his political career.
According to a 1989 article that appeared in The New York Times at the time of his death:
The series of events that finally brought Mr. Bevilacqua down began at the end of 1984... stating that reporters and state police officers had observed Mr. Bevilacqua repeatedly visiting the homes of underworld figures.
The state police alleged that Mr. Bevilacqua had also visited a Smithfield motel, owned by men linked to gambling and drugs...
Thomas Fay, the successor to Bevilacqua as Chief Justice of the Supreme Court, resigned in 1993, and was later found guilty on three misdemeanor counts of directing arbitration work to a partner in his real estate firm, Lincoln Center Properties.
Fay was also alleged to use court employees, offices, and other resources for the purposes of the real estate firm. Fay, along with court administrator and former Speaker of the House, Matthew "Mattie" Smith were alleged to have used court secretaries to conduct business for Lincoln, for which Fay and Smith were business partners.
Fay was fined $3,000 and placed on one year probation. He could have been sentenced for up to three years in prison.
Former Pawtucket Mayor Brian J. Sarault was sentenced in 1992 to more than 5 years in prison, after pleading guilty to a charge of racketeering.
Sarault was arrested by state police and FBI agents at Pawtucket City Hall in 1991, who alleged that the mayor had attempted to extort $3,000 from former RI State Rep. Robert Weygand as a kickback from awarding city contracts.
Weygand, after alerting federal authorities to the extortion attempt, wore a concealed recording device to a meeting where he delivered $1,750 to Sarault.
Cianci was forced to resign from the Mayor’s office a second time in 2002 after being convicted on one several charges levied against him in the scandal popularly known as “Operation Plunder Dome.”
The one guilty charge—racketeering conspiracy--led to a five-year sentence in federal prison. Cianci was acquitted on all other charges, which included bribery, extortion, and mail fraud.
While it was alleged that City Hall had been soliciting bribes since Cianci’s 1991 return to office, much of the case revolved around a video showing a Cianci aide, Frank Corrente, accepting a $1,000 bribe from businessman Antonio Freitas. Freitas had also recorded more than 100 conversations with city officials.
Operation Plunder Dome began in 1998, and became public when the FBI executed a search warrant of City Hall in April 1999.
Cianci Aide Frank Corrente, Tax Board Chairman Joseph Pannone, Tax Board Vice Chairman David C. Ead, Deputy tax assessor Rosemary Glancy were among the nine individuals convicted in the scandal.
Councilmen Raimond A. Zambarano, Joseph Burchfield, and Raymond L. Douglas III were sentenced to prison terms of 71 months, 64 months, and 78 months, respectively.
Central Falls Mayor Charles Moreau resigned in 2012 before pleading guilty to federal corruption charges.
Moreau admitted that he had give contractor Michael Bouthillette a no-bid contract to board up vacant homes in exchange for having a boiler installed in his home.
He was freed from prison in February 2014, less than one year into a 24 month prison term, after his original sentence was vacated in exchange for a guilty plea on a bribery charge. He was credited with tim served, placed on three years probation, and given 300 hours of community service.
State Representative Joseph S. Almeida was arrested and charged on February 10, 2015 for allegedly misappropriating $6,122.03 in campaign contributions for his personal use. Following his arrest, he resigned his position as House Democratic Whip, but remains a member of the Rhode Island General Assembly.
Fox pled guilty to 3 criminal counts on March 3, 2015 - accepting a bribe, wire fraud, and filing a false tax return. The plea deal reached with the US Attorney's office calls for 3 years in federal prison, but Fox will be officially sentenced on June 11.
