Second Man Pleads Guilty to Multi-Million Dollar Commercial Leasing Fraud Scheme

<_w3a_sdt combobox="t" docpart="2FE4C29872BD49BB80798A6C1B6E4D3C" id="-1762599719" sdttag="Location" title="Location"><_w3a_listitem datavalue="RALEIGH" listvalue="RALEIGH"> <_w3a_listitem datavalue="GREENVILLE" listvalue="GREENVILLE"> <_w3a_listitem datavalue="NEW BERN" listvalue="NEW BERN"> <_w3a_listitem datavalue="WILMINGTON" listvalue="WILMINGTON"> <_w3a_listitem datavalue="ELIZABETH CITY" listvalue="ELIZABETH CITY"> RALEIGH, N.C. - Armando Binelo, 46, of Pigeon Forge, Tennessee, pled guilty for his role in a 20-million-dollar leasing fraud scheme. Daniel Raymond, 54, of Mebane, previously pled guilty to conspiracy to commit mail fraud and wire fraud and was sentenced to 84 months in prison. Binelo faces up to 20 years in prison when sentenced.

"Our Assistant U.S. Attorneys are hard at work in unraveling complex financial frauds like this one, where a computer equipment supplier billed financiers for millions in a scheme that lasted years," said U.S. Attorney Michael Easley. "The Research Triangle is a hub for tech and innovation. We are ramping up white collar fraud enforcement to ensure fraudsters who take advantage of our booming tech sector are held accountable."

According to court documents and information presented in court, from March 2016 to January 2022, Binelo and Raymond executed a scheme to defraud financing companies in connection with computer equipment lease deals. The scheme's targets were financing companies that offered small to medium-sized businesses ("customers") financing and secured leases for computer servers and equipment. Under these leasing programs, financers paid for and took title to the equipment and then leased it to the customers for a fixed term. Financers entered into agreements with brokers who, for a fee, could bring potential equipment leasing opportunities to the financers for evaluation and approval. As a third-party independent financing source, financers did not manufacture or supply the computer equipment. Instead, the brokers, like Raymond, arranged for the purchase and delivery of the equipment to the customers, who then leased that equipment from the financers.

Raymond targeted financially distressed small business customers throughout the country and offered them leases for computer equipment. Typically, the customers Raymond targeted were seeking a cash infusion for operating expenses and had no immediate need for computer equipment. Nonetheless, Raymond enticed customers by offering lease deals with large cash rebates and long-term payback options. Raymond falsely assured customers that this was a common and legitimate practice and that they could always sell the computer equipment if they chose to. The cash rebates and payback options offered by Raymond were not known to or approved by the financers.

Raymond executed the lease agreements with the customers and then submitted the leases and invoices to a financer. If approved, the financer paid Raymond a lump sum payment, which was intended to represent the cost of the computer equipment to be supplied by Raymond, plus a small fee to be retained by Raymond as profit. Once the leases were signed and approved by the financer, Raymond instructed the customers to create false documents that claimed the computer equipment had been delivered, installed, and was operational at their business sites, despite no equipment being delivered or installed. These false declarations enabled the financier to pay Raymond. After Raymond obtained payment from the financers, he wired the cash rebates to the customers from his business checking account. Raymond sometimes did ship computer equipment to the customers. However, whereas the leases called for name-brand computer servers and hardware valued between $30,000 - $100,000, Raymond sent cheap computer equipment and parts.

Raymond was affiliated with the following businesses: Integrity IT Solutions, Inc. ("IITS"), Logos Consulting, LLC ("Logos"), Lendberry Corp. ("Lendberry"), US Server Supply ("USSS"), Online Concepts Inc. ("OC"), Referral Marketing Services ("RMS"), Sandriver Group, Inc. ("Sandriver"), Business Repair Consultants ("BRC"), and Buyback Funders, LLC ("Buyback").

Binelo joined the scheme as a small business customer who entered fraudulent computer equipment leases with Raymond in exchange for cash rebates. Eventually, Binelo was recruited as a vendor/partner with various lending institutions. Under their arrangement, Raymond secured the fraudulent leases with customers, which Binelo passed off to the victim lenders. Victim lenders wired the proceeds to a bank account controlled by Binelo. Binelo took his portion of the proceeds and wired the remaining funds to Raymond.

Raymond participated in fraudulent lease deals valued at more than 20 million dollars. Binelo participated in fraudulent lease deals valued at more than 6 million dollars. Binelo pled guilty to conspiracy to commit wire and mail fraud.

Michael Easley, U.S. Attorney for the Eastern District of North Carolina made the announcement after United States District Judge Terrence W. Boyle accepted the plea. The Federal Bureau of Investigation is investigating the case and Assistant U.S. Attorney <_w3a_sdt docpart="F4DBA6C3863D40EBB5C93E625BAE3122" id="973258869" sdttag="AUSA/SAUSA" title="AUSA/SAUSA">Toby Lathan is prosecuting the case.

Related court documents and information can be found on the website of the U.S. District Court for the Eastern District of North Carolina or on PACER by searching for Case No. <_w3a_sdt docpart="5371C693B03241AFA67CC970DD37161E" id="1610241575" sdttag="Case No." title="Case No.">5:20-cr-00045-BO-1.