Case: Doc 2 Filed: 12/17/13 Page: 1 of 16 PAGEID 12 UNITED STATES DISTRICT COURT 1 I SOUTHERN DISTRICT or OHIO 1- - I WESTERN DIVISION I I ,5 UNITED STATES OF CASE NO. Plamnff, v- 5 I WEBER GLEN GALEMMO, PLEA AGREEMENT Defendant. The United States Attorney for the Southern District of Ohio and the defendant, individually and through counsel, pursuant to Rule of the Federal Rules of Criminal Procedure, agree as follows: l. Offense of Conviction: The Defendant agrees to waive indictment and plead guilty to the Information currently pending against him, which charges him with Wire Fraud (Count One), in violation of 18 U.S.C. 1343 and Money Laundering (Count Two), in violation of 18 U. S.C. 1956. The Defendant admits that he is, in fact, guilty of these offenses 'and will So advise the Court. The United States Attorney for the Southern District of Ohio will not filrther prosecute the Defendant for the conduct described in the Information and attached Statement of Facts. 2. Elements of the Offense: The elements of the offense to which the Defendant has agreed to plead guilty, and which the United States Attorney's Office (USAO) would prove if the case Went to trial, are as follows: Count One (Wire Fraud) a. That the Defendant devised a scheme to defraud in order to obtain money or property, that is to defraud investors to obtain money and property by means of false and liraudulent pretenses, representations, and promises; b. That the scheme included a material misrepresentation or concealment of a material feet; c. That the Defendant had the intent to defiaud; d. That the Defendant used or caused another to use wire, radio or television 1 Case: Doc 2 Filed: 12/17/13 Page: 2 of 16 PAGEID 13 3. E3. conzunulrications in interstate commerce in furtherance of the scheme; and That some or all of the acts alleged in the Information occurred in the Southern District of Ohio, on or about the dates alleged in the Information. Count Two (Money Laundering) That the Defendant conducted a financial transaction; That the financial transaction involved property that represented the proceeds of wire fraud in Violation of 18 U.S.C. 1343; That the Defendant knew that the property involved in the financial transaction represented the proceeds of some form of unlawful activity; and That the Defendant knew that the transaction was designed in whole or in part to conceal or disguise the nature, location, source, ownership, control of the proceeds of said specified unlawful activity; and That some or all of the acts alleged in the Information occurred in the Southern District of Ohio, on or about the dates alleged in the Inforrnation. Penalties: The maximum sentence is as follows: Count One: Not more than twenty years imprisonment, a fine not to exceed $250,000 or, more than the greater of twice the gross gain by the defendant or twice the gross loss to another, and a term of supervised release not longer than three (3) years; Count Two: Not more than twenty years irnprisonnrent, a fine not to exceed the greater of either $500,000 or twice the value of the property involved in the iransaction, and a term of supervised release not longer flaan three (3) years; Additional irnprisornnent if the Defendant violates the conditions of his supervised release; Restitution and forfeiture; and A mandatory special assessment of $200, due prior to sentencing. Waiver of Rights: The Defendant understands that by entering into this agreement, he surrenders certain rights, among others, as outlined below: 3.. To be represented by an attorney at every stage of the proceeding, and that, if necessary, one will be appointed to represent him; 2 Case: Doc 2 Filed: 12/17/13 Page: 3 of 16 PAGEID 14 b. To plead not guilty and to be tried by a jury; c. To be assisted by counsel during such trial; d. To confront and adverse wimesses; e. To compel witnesses for the defense; f. Not to be compelled to testify; g. To be presumed innocent throughout trial and until a jury finds proof of guilt beyond a reasonable doubt; and h. To appeal the jury's verdict and the Courts decisions regarding the admissibility of dence. By pleading guilty, the Defendant understands that he will also be giving up certain valuable civil rights and may be subject to deportation or other loss of irnmigraiion status if the he is not a United States citizen. 5 . Waiver of Defenses: The Defendant waives all defenses based on the Statute of limitations and the Speedy Trial Act as to any charges that are not tilne-barred as of the date that Defendant signs this agreement. 6. Use of Statements: The Defendant waives any protection afiorded by Rule l1(f) of the Federal Rules of Criminal Procedure, Rule 410 of the Federal Rules of Evidence, and ]Bl of the United States Sentencing Guidelines Manual. Any statements made by Defendant in the course of plea discussions, in any proceeding under Rule 1 1 of the Federal Rules of Criminal Pro eedure, and during any cooperation with law enforcement authorities will be admissible against Defendant without limitation in any civil or clizninal proceeding. 7. Applicability of Advisog Sentencing Guidelines: The Defendant understands that the sentence in this case will be imposed by the Court. In determining an appropriate sentence, the Court will consider the factors outlined in 18 U.S.C. 35S3(a), along with the applicable advisory, sentencing range under the United States Sentencing Guidelines 8. Factual and Advisory Guidelines Stipulation: The parties agree to the Statement of Facts set forth in Attachment A, and incorporate them here by reference, and to the following advisory sentencing guideline factors: a. Count One: Wire Fraud, in violation of 18 U.S.C. 1343. Case: Doc 2 Filed: 12/17/13 Page: 4 of 16 PAGEID 15 i. Pursuant to U.S.S.G. the base offense level is 7, because the statutory maximum sentence for wire fiaud is 20 or more years. ii. Pursuant to U.S.S.G. 2131 20 levels are added because the loss to investors exceeded $7,000,000, but was less than $20,000,000. Pursuant to U.S.S.G. 4 levels are added because the offense involved more than 50 victims but less than 250 victims. iv. The government contends that pursuant to 2B1 8), 4 levels are added because the otfense involved a violation of securities and/or commodities law and at the time of the offense the defendant was a registered broker or dealer or a person associated with a registered broker or dealer, andfor the defendant was a commodity pool operator. The final offense level for Count I is 35 (goverr1n1ent's position) or 31 (the defendant's position). b. Count' Two: Money Laundering, in violation of 18 U.S.C. 195 i- Pursuant to U.S.S.G. the base offense level is the offense level from Count ii. Pursuant to U.S.S.G. 281 2 levels are added because Count Two is a violation of 18 USC. 1956, bringing the final offense level for Count II to 37 (governnienfs position) or 33 (the defendant's position). 0. Grouping: Pursuant to U.S.S.G. Counts One and Two group and the combined offense level becomes 37 (governrrienfs position) or 33 (the defendant's position). d. The USAO does not oppose a 2 level reduction in offense level pursuant to U.S.S.G. 3E1 .1 based upon the Defendant's acceptance of responsibility, provided that the Defendant's conduct continues to demonstrate compliance with the terms of? 3131.1. e. The USAO agrees to make a motion pixrsuant to .S.S.G. 3131 for an additional 1 level decrease in recognition of the Defendant's timely notification of his intention to plead guilty. However the USAO reserves the right to oppose Q3: adjustment for acceptance of responsibility at sentencing if the Defendant: (1) gives conflicting statements about his involvement in the ofiense; (2) is untruthful with the Court, this Office, or the United States Probation Office; (3) obstructs justice prior to sentencing; (4) engages in any criminal conduct between the date of this agreement and the date of Case: Doc 2 Filed: 12/17/13 Page: 5 of 16 PAGEID 16 10. ll. sentencing; or (5) attempts to withdraw his plea of guilty. The final offense level is 34 (govermnenfs position) or 30 (the defendant's position). There is no agreement as to the Defenclanfs crirairial history or criminal history category, and the Defendant understands that his criminal history could affect his advisory sentencing guideline range. Waiver of Appeal: The Defendant waives the right to appeal the sentence imposed, including the right conferred by 18 U.S.C. 3742(a), except that the Defendant reserves the right to appeal a sentence of irnpri sonment that exceeds 188 months. This waiver shall not be construed to bar a claim by the Defendant of ineffective assistance of counsel or prosecutorial misconduct. The government reserves the right to appeal a sentence of imprisonment below 97 months. Freedom of Information Act: The Defendant waives all rights under the Freedom of Information Act relating to the investigation and prosecution of him and agrees not to file any request for documents. Forfeiture: The Defendant agrees to forfeit to the United States of '2'-ltrnerica the property listed below pursuant to 18 U.S.C. 981(a)(l)(C) and 28 U.S.C. ?2461(c) as proceeds of Wire fraud andlor 18 U-S.C. 982(a)(1) property involved in money laundering. The Defendant further agrees to waive all legal and equitable defenses to the forfeiture of the property listed below (hereinafter "the subject property") and agrees not to challenge the forfeiture in any manner: a. Real property known and numbered as 2230 Park Avenue, Cincinnati, Hamilton County, Ohio 45206 with all appurtenances, improvements, and attachments thereon; b. The Contents of US Bank Account X5618 in the name of Queen City Investment Fund II Bank in the amount of Four Hundred Thirteen Dollars and Ninety-Eight Cents ($413 c. The Contents of US Bank Account x844 3, in the name of Queen City Holdings, LLC, Bank in the amount of Three Hundred Fifty-Two Dollars and Sixty-Four Cents d. The Contents of US Bank Account X4670, in the name of QFC, LLC, Bank in the amount of Four Hundred Twenty-four Thousand Two Hundred ThiIty--eight Dollars and Times Cents Case: Doc 2 Filed: 12/17/13 Page: 6 of 16 PAGEID 17 e. The Contents of Keybank Account X5922, in the name of Glen and Kristine Galernrno, ("Keyhanlc in the amount of Thirty-Six 'Thousand Fifty-Nine Dollars and Twenty Cents 6,05 f. The Contents of Donnan Trading Account X63 3, in the name of QFC, LLC, ("Dorrnan x633") in the amount of Ten Thousand Seven Hundred Seventy-Two Dollars and Thirty-Six Cents g. The Contents of Dorrnan Trading Account 1:695, in the name of QFC, LLC, ("Dorman in the amount of Five Thousand Dollars h. The Contents of Dorman Trading Account X696, in the name of QFC, LLC, ("Donnan in the amount of One Hundred Ninety-Two Thousand Four Hundred Fifty Dollars and Twenty--Five Cents i. The Contents of Interactive Brokers, LLC Account 2:016, in the name of QFC, LLC, ("Interactive in the amount of Five Hundred Fourteen Thousand One Hundred Seventy-Six Dollars and Sixty-Five Cents j. The Contents of Interactive Brokers, LLC Account X43 8, in the name of QFC, LLC, ("Interactive X43 in the amount of One Thousand Seven Hundred Sixty Six Dollars and Thirty-Five Cents Real property known and numbered as 1349 Madison Avenue, Cincinnati, Hamilton County, Ohio 45206 with all appurtenances, improvements, and attachments thereon; 1. Real property known and numbered as 6000 Royal Marco Way, Unit 454, Marco Island, Florida 34145 with all appurtenances, improvernents, and attachments thereon; 1:1. The Contents of Key Bank Account X5628 inthe name of QC Power Strategies Fund, LLC ("Key Bank in the amount of Four Hundred Forty Thousand Three Hundred Seventy Dollars and Seventy-Eight Cents n. A 2007 GMC Yukon XL, VIN 1GKFK66897J236949, titled to Kristine Galemrnog 1 The Defendant's agreement to forfeit his interest in the Contents of Key Bank Account x5922, does not preclude Kristine Galeulrno from asserting a claim in the account based upon her own interest in the account. 6 Case: Doc 2 Filed: 12/17/13 Page: 7 of 16 PAGEID 18 12. 0. A 2007 GMC Acadia, VIN 159616, titled to Kristine Galemmo; p. A 2004 Nissan 3502, VIN titled to Jones-Morris Group, q. A 2012 Audi A8, VIN titled to QFC, A 2013 Toyota Highlander, VIN 1 94089, titled to Kristine Galemmo; s. The Contents of First Citizens Bank Account X1609 in the name of Kristine Galemnzlo in the amount of One Hundred Two Thousand Twenty--Six Dollars and Ninety-Two Cents and t. The Contents of First Citizens Bank Account X3209 in the name of Kristine Galemmc in flue amount of Twelve Thousand Three Dollars and Two Cents The Defendant agrees to assist the United States to resolve in its favor any claims by another individual to the subject property. The Defendant agrees to take all necessary steps to pass clear title to the subject property to the United States, and to testify truthfully in any forfeiture proceeding. The defendant agrees not to contest the administrative or judicial forfeiture of the subject property and to consent to the entry of judgments and orders of forfeiture of the subject property. Restitution: The Defendant agrees to pay restitution in an amount to be determined by the Court. The Defendant acknowledges that the Court shall deterrnine a payment schedule. Such payments will be completed within the period of his supervised release. In the event the Defendant is unable to pay completely the total amount of restitution owed prior to termination of the supervised release period, he agrees to make regular payments toward such liability in an amount to be determined by the Court. Such amount will be set in accordance with the Defendanfs financial ability. Tax Liabflity: The Defendant agrees that nothing in this agreement forecloses or limits the ability of the IRS to examine and make adjustments to any return filed pursuant to this agreement, and that the defendant will not," after filing the returns, file any claim for refund of taxes, penalties or interest for amounts attributable to the returns filed in connection with this plea agreement. The Defendant further agrees: a to file with the IRS complete and accurate amended U.S. Individual Income tax returns (defendaufs personal returns) for all previously-filed incomplete or inaccurate tax returns, including the 201 1 tax year and periods up to the 7 Case: Doc 2 Filed: 12/17/13 Page: 8 of 16 PAGEID 19 14. 15. 16. date of sentencing; b. to fully cooperate with the IRS in order to determine and calculate all taxes, interest, and penalties due and owing by the defendant to the United States, including but not limited to melting defendant"'s books and records available, and providing supporting documentation to the IRS for examination and copying upon reasonable request; c. to pay to the IRS all taxes, penalties, and interest due and owing by the defendant to the United States, including but not limited to all taxes, penalties, and interest owed on all returns filed pursuant to this plea agreement, or, if financially unable to do so, make repayment arrangements which are satisfactory to the cl to comply with the tax laws of the United States; and e. to allow the contents of any criminal file maintained by this oifice or IRS Criminal Investigation to be given to the IRS Examination and Collection Divisions in order to investigate any and all civil taxes and penalties that may be due and owing by defendant. With respect to disclosure of the criminal file, the defendant waives any rights under 26 U.S.C. 7213, and any other right of privacy with respect to the Defendant's tax returns and return information. Court Not A Pam: The Defendant understands that the Court is not a party to this agreement and it is within the sole discretion of the Court to impose the sentence in this case. The Defendant further understands that the Court is not obligated to accept the parties' sentencing guidelines stipulation and may impose a sentence up to the statutory rnaxirnum sentence stated above. The Defendant understands that if the Court imposes a sentence up to the statutory maximum, the Defendant cannot, for that reason alone, withdraw his guilty plea, and will remain bound by this agreement. Violation of Plea Agreement: The Defendant understands that in the event he breaches this ageernent: a. The Defendant shall not have the right to withdraw the guilty plea; and b. The USAO will be relieved of all of its obligations under this agreement and may institute or maintain any charges or sentencing recommendations that would otherwise be prohibited by this agreement. Entire Agreement: There are no agreements, understandings or promises between the parties other than those contained in this agreement. 8 Case: Doc 2 Filed: 12/17/13 Page: 9 of 16 PAGEID 20 Respectfially submitted, CARTER M. STEWART United States Attorney fiimflg .f