| |
|
|
Department of Justice |
|
MUSKOGEE, OKLAHOMA - Sheldon J. Sperling, United States Attorney for the Eastern District of Oklahoma, announced today that IVY KWOK ONG, a/k/a Ivy Ong, age 66, of El Paso, TX, was sentenced for Conspiracy to Commit Tax Evasion and Conspiracy to Pay and Receive Illegal Gratuities, in violation of 18 U.S.C. §371, 201(c)(1)(A)&(B) and 26 U.S.C. §7201. ONG was the operator of Carlo Worldwide Operations, LLC, a Nevada corporation active in supplying video gaming machines to tribal casinos. "ONG was sentenced to 39 months in federal prison and 36 months on supervised release on each count, to run concurrently," stated U.S. Attorney Sheldon J. Sperling. "He was ordered tol pay $199,610 in restitution to the Internal Revenue Service and a $200 special assessment to the court. No fine was imposed based upon the restitution ordered, the defendant's current financial situation and the uncertainty of his future earning abilities." "The defendant pled guilty to the charges on September 21, 2007. At that time, ONG also agreed to forfeit his interest in a gated-community home in Choctaw, Oklahoma and a 15-acre horse farm in Lexington, Kentucky. These parcels of real estate were purchased with proceeds of his criminal activities. The properties are estimated to be worth over $1,000,000.00," reported U.S. Attorney Sperling. "The court forfeited ONG's interest in those properties today." "The Honorable Ronald A. White, District Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, presided over today's sentencing. Judge White ordered the defendant to begin serving his sentence at noon on June 20, 2008." "During the sentencing hearing, the court first heard arguments by defense counsel David Ogle of Oklahoma City. Then Mr. Ong made a brief statement to Judge White: 'I did, in fact, do the things I was indicted for. I apologize to the United States and to the Seminole Nation. I'll have to live with that. I'm sorry for what happened.'" "The Seminole Nation previously submitted a victim impact statement requesting several million dollars in restitution," noted U.S. Attorney Sperling. "The Seminole Nation cited its difficulties with the National Indian Gaming Commission and the IRS stemming from their involvement with Mr. Ong. Losses that the Seminole Nation attributes to Mr. Ong include an $11 million fine by the NIGC, over $170,000 in IRS penalties and fines, and $8.4 million in lost income while the Seminole Nation's casinos were closed for 13 months in 2003 and 2004. The court did not order any restitution to the Seminole Nation." "ONG was the focus of an investigation by the United States Bureau of Indian Affairs (BIA), the United States Internal Revenue Service (IRS), the United States Department of Interior Inspector General (DOIOIG), the United States Federal Bureau of Investigation (FBI) and the National Indian Gaming Commission (NIGC)," U.S. Attorney Sperling noted. "In February 2001, BIA officials were approached by local law enforcement officials complaining that a prostitution and drug ring was operating in the parking lot of the Seminole Nation I-40 travel plaza and casino. Federal authorities were already engaged in a lawsuit, later dismissed by the federal court, in an attempt to close the facility for operating illegal Class III slot machines. The government's position was later vindicated on appeal." "Our focus then shifted from the parking lot to activities inside the casino and on to the operators and investors financing the Seminole casinos," said U.S. Attorney Sperling. "What the investigators found deeply disturbed us." "AUSA Linda Epperley ably represented the United States in this case. Her expertise in the areas of Indian gambling, tax evasion, and money laundering was instrumental to the successful conclusion of this matter," U.S. Attorney Sperling added. "According to the guilty plea entered by the defendant, ONG and the tribe entered into a series of agreements beginning in August 2000. ONG was to build or update four casinos in Seminole County and to provide video games at those locations. Under the agreements, ONG's company got 40% of the net winnings and the tribe received the remaining 60%," AUSA Epperley recalled. "The agreements provided an additional benefit to ONG. Because ONG negotiated with the tribe as a machine vendor, rather than a gaming manager, his agreements were not reviewed by the NIGC, and ONG did not undergo a background check," explained U.S. Attorney Sperling. "A cursory background check of publicly-available records would have revealed a criminal record in California, alleged ties to organized crime in Nevada and an unpaid tax liability to the IRS," noted U.S. Attorney Sperling. "The Information filed states that ONG owed nearly $200,000 to the IRS for taxes unpaid in 1991, 1995, 1997, and 1999-2001. ONG used the cash generated from the Seminole casinos to set up various bank accounts and manipulate financial records to hide his assets from the IRS. The two pieces of property that he agreed to forfeit today were purchased with funds from the scheme and placed in the names of third parties to conceal and disguise ONG's true ownership." "Tracing ONG's finances revealed unusual payments to some tribal leaders and required the investigation of other targets and subjects. Over the past six years, the records of over 70 bank accounts have been reviewed and rooms full of documents have been examined. Funds have been traced going through ONG, Carlo Worldwide, and Seminole casinos from multiple states and several foreign countries. Due to ONG's attempts to open an Indian casino in the Hamptons and ONG's direction that his 40% monthly payments be split with gambling-connected companies in Costa Rico, the money trail stretched far beyond a travel plaza on I-40. Each new account generated another list of individuals to be interviewed and leads to be followed. Federal agents have worked countless hours and performed admirably in this investigation." "The case of one other conspirator, Rick Deer, a tribal councilor who allegedly received gratuities from ONG is set for trial mid-July 2008." "The Information refers to at least three tribal public officials who requested and received illegal gratuities from ONG to advance and protect ONG's gambling business with the Tribe. Person "A" was a General Council member and Seminole Nation Development Authority (SNDA) member who received at least 16 payments totaling $44,100 from ONG and Carlo. ONG paid a mortgage deficiency and attorney fees in the amount of $7,190.82 for Person "B" who served on the General Council and a gaming commission. Person "C", who also served as a General Council member and SNDA member, received home renovations for which ONG paid $8,607. The Information states that certain individuals created false documents and doctored business records to conceal such payments from authorities." "While I will not elaborate on the identities of the unnamed co-conspirators referenced in the Information, I do want to mention three persons who are not implicated," noted U.S. Attorney Sperling. "Former Chief Jerry Haney was informed of this investigation in 2001 and was asked to keep his knowledge confidential. He did so over the next two years at great personal and political cost. Current Chief Enoch Kelly Haney had also been made aware of the investigation and has been extremely supportive at every turn. Finally, Qazi Alam, the former SNDA Director who was initially considered at target of the investigation, has been cleared by ONG. ONG has told prosecutors that he offered a Rolex© watch to Mr. Alam and cash bonuses to Alam's employees, but Mr. Alam refused all offers as unethical and unlawful. ONG said that, 'Lots of others asked, but not Qazi,' " said U.S. Attorney Sperling. "Bottom line?
This was a man who should never have been allowed anywhere near an Indian
gaming facility," U.S. Attorney Sperling said after ONG's plea. "Until
we have a method of tracing not only those who manage, but also those
who supply or invest in tribal casinos, Indian Country remains vulnerable
to infiltration by those like defendant ONG." |
|||
####
|
|||