Case: 1:19-cv-01949-PAB Doc #: 1 Filed: 08/26/19 1 of 10. PageID #: 1

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF OHIO
EASTERN DIVISION
UNITED STATES OF AⅣ IERICA,

)CASE NO.
)

)

Plainti範

)JUDGE

V.

)
)

THE REAL PROPERTY LOCATED AT
)
741l SALIDA ROAD,MENTOR¨ ON― THE )
―
LAKE,LAKE COUNTY,OHIO;
)

PARCEL NUMBER:19A-089-A¨ 00-OH‐ 0, )

Defendant.

)

)COMPLAINT IN FORFEITURE

NOW COMES plaintint thc united States ofAmerica,by Justin E.Herdman,Unitcd
States Attorney for the Northerll District of Ohio,and Jamcs Lo Morford,Assistant U.S.
Attomey,and flles this Complaint in Forfciture,rcspectilly alleging as follows in accOrdance

with Supplcmcntal Rulc G(2)ofthC Fedcral Rules of Civil Procedure:

」
URISDICTION
l.

AND INTRODUCTION

This Court has suttect matterJuriSdiCtion over an action cOllllllllenCed by the

Unitcd States undcr 28 U.S,C.§

1345,and over an action for forfeiturc under 28 U.S.C.

§ 1355(a).ThiS COurt also hasju五 sdiction over this particular actiOn under 18 U.S.C.

§981(a)(1)(C)and
2.

18 U.S.C.§ 981(a)(1)(A).

This Court has jη

rθ

jurisdiction ovcr the defendant real property(hercinaftcr,

“

``defendant property"or``defendant lakefront residencc'')under 28 UoS.C.§

1355(b).Further,in

 Case: 1:19-cv-01949-PAB Doc #: 1 Filed: 08/26/19 2 of 10. PageID #: 2

this regard, the United States will post notice of this action and a copy of the Complaint in

Forfeiture on the defendant property in accordance with 18 U.S.C. g 985(c)(1)(B).

3.

Venue is proper in this district pursuant to: (i) 28 U.S.C. $ 1355(bX1) because

acts giving rise to the forfeiture occurred in this district; and,

(ii) 28 U.S.C. $ 1395(b) because

the defendant property is located in this district.

4.

The defendant property is subject to forfeiture to the United States under 18

U.S.C. $ 981(aXl)(C) in that it constitutes

-

or is derived from

-

proceeds traceable to

violation(s) of 18 U.S.C. $ 1084 (transmission of gambling information) and 18 U.S.C. $ 1955

(illegal gambling businesses).

5.

The defendant property also is subject to forfeiture to the United States under 18

U.S.C. $ 981(aX1)(A) in that it was involved in a transaction(s) in violation of 18 U.S.C. $ 1957
(money laundering), or is property traceable to such property.

DESCRIPTION OF THE DEFENDANT PROPERTY

6.
-

The defendant property - including all hxtures, improvements, and appurtenances

is lakefront (Lake Erie) property, and is known and numbered as 7411 Salida Road, Mentor-

On-The-Lake, Lake County, Ohio.

7.

The legal description of the defendant property is as follows:

Situated in the City of Mentor-On-The-Lake, County of Lake and State of Ohio: and
known as being Sublot No. 28 in Salida Allotment of part of Original Mentor Township
Lots No. 3 and 4,TractNo. 16, as shown by the recorded plat in Volume B of Maps,
page 3 of Lake County Records and being a parcel of land 78 feet front on the Northerly
sideof SalidaAvenueandhas arear lineof 76-114 feet,asappearsbysaidplat,bethe
same more or less, but subject to all legal highways. Excepting therefrom any portion of
the above described premises resulting in change of the shoreline of Lake Erie
occasioned by other than natural causes or by natural causes other than accretion.
Permanent Parcel Number: 194-089-4-00-01 1-0.

つ乙

 Case: 1:19-cv-01949-PAB Doc #: 1 Filed: 08/26/19 3 of 10. PageID #: 3

8.

The nominal record owners of the defendant property are Joy A. Reider and

Michael L. Reider. The owner in fact of the defendant property is Clinton Reider, the son of Joy

A. Reider and Michael L. Reider.

9.

The estimated value of the defendant property is $421,000.00

ILLEGAL GAMBLING OPERATION

10.

Since approximately 2010, Clinton Reider has been running a large scale

gambling and bookmaking operation in violation of the law of the State of Ohio. The gambling
and bookmaking operation used sports betting websites that operated outside of the United

States. Federal agents - namely, Special Agents with the United States Secret Service (USSS)
and the Internal Revenue Service, Criminal Investigation

(IRS-C!

-

first became aware of this

activity in and after March ,2075.

11.
area

The offshore websites provided Clinton Reider's "clients" in the Northeast Ohio

with access to betting on virtually any sporting event, and provided Reider with the

infrastructure to take and track all bets of the bookmaking operation. Reider paid a fee to the
website owners for each active "client" account.

12.

The management companies for the websites were/are located in Costa Rica,

Panama, and in the Caribbean country of Curacao. Intermediaries for the websites would collect

payments

-

for the bookmaking operation's use of the websites - from Clinton Reider.

13.

Clinton Reider sent money to the operators of the sports betting websites via

Western Union transfers, by sending money orders through U.S. based mailing services, or cash
deposits into a nominee account. Particularly, concerning the Westem Union transfers, Reider

3

-

 Case: 1:19-cv-01949-PAB Doc #: 1 Filed: 08/26/19 4 of 10. PageID #: 4

on multiple occasions

-

made the payments himself or through a nominee. Reider instructed the

nominee(s) to break up payments to just under $3,000.00 to avoid any reporting requirements.

14.

As alleged above, the offshore websites provided Clinton Reider with the

infrastructure to take and track all bets of the bookmaking operation. Reider documented the

weekly collection and payment amounts from the websites into a notebook. The notebook
documented not only the collection amounts and payment amounts for Reider's Northeast Ohio

"clients", but also the collection/payment amounts of other bookmakers who utilized the same
websites through Reider.

15.

On multiple occasions, trash pulls were conducted at the defendant property.

Weekly collection and payment notepapers

-

which had been torn apart by hand

-

were

recovered and reconstructed.

16.

On March 22,2017, Special Agents with the USSS and IRS-CI executed search

warrants at the defendant property and of Clinton Reider's vehicle, which was parked in the

driveway at the defendant property.
17

.

During the search of Clinton Reider's vehicle, current weekly collection and

payment records related to the illegal gambling operation were recovered. The gambling records
documented activity "for a couple of weeks during 2017."

18.

During the search of the defendant property, Clinton Reider's cell phone was

recovered. A search of the cell phone revealed texts and other messages with "clients" relating
to the gambling operation; e.g., discussions concerning the placing of bets and the collection on
losing wagers.

19.

In addition, the web browser history of Clinton Reider's cell phone was reviewed,

which showed that he frequently visited the above-referenced offshore websites.

 Case: 1:19-cv-01949-PAB Doc #: 1 Filed: 08/26/19 5 of 10. PageID #: 5

20.

During the course of the investigation, numerous witnesses were interviewed.

Each acknowledged using the offshore sports betting websites and being a

"client" of Clinton

Reider's bookmaking operation. The witnesses further acknowledged paying Reider a combined
total of at least $500,000.00 by check or through PayPal as payment for amounts owed to the
gambling operation.

21.

In collecting payments for losing bets and paying off winning bets, Clinton Reider

dealt with his "clients" primarily in cash but, as alleged above, often accepted payments using
checks or PayPal.

22.

Michael Reider, is the father of Clinton Reider. Michael Reider assisted Clinton

Reider with picking up and dropping off payments related to the bookmaking operation.

Additionally, Michael Reider made payment(s) to the sports betting website operator.

23.

Clinton Reider also ran poker games out of various locations.

FINANCIAL INFORMATION

24.

Clinton Reider filed for Chapter l3 bankruptcy on July 28, 2009, and provided an

amended summary of schedules on January 6,2010, reporting $50.00 as his available cash on

hand. In approximately March2015, Reider received

a discharge

of unsecured claims in the

amount of $124,324.09.

25.

From20l2 through 2015, Clinton Reider had total combined "legitimate" income

of approximately $270,000.00. During that same time period, his personal expenditures
exceeded $1.45 million.

5

 Case: 1:19-cv-01949-PAB Doc #: 1 Filed: 08/26/19 6 of 10. PageID #: 6

26.

Clinton Reider purchased the defendant property in2011. Reider used his parents

- Joy Reider and Michael Reider - to obtain a mortgage loan, and purchased the property using
his parents as nominee owners.

21.

In 2011, Clinton Reider demolished the house then on the property and - between

2073 and201612017 - constructed a much larger, custom residence (the "defendant lakefront
residence") on the property.

28.

As alleged above - in collecting payments for losing bets and paying off winning

bets - Clinton Reider dealt with his "clients" primarily in cash. Although the amount of cash
generated by Reider's gambling operation cannot be determined with any precision, records

document that he "bought in" on table games at the Horseshoe Casino Cleveland in excess
$1.5

of

million in cash from2012 through 2016.

29.

Clinton Reider utilized his personal account and a "business" bank account to

make large and frequent cash deposits and withdrawals. Between2012 and2076, cash deposits

into these Reider-related bank accounts totaled $408,869.10.

30.

Between 2012 and2016, confirmed gambling-related check deposits into the

Clinton Reider-related bank accounts totaled $266.

31.

82 6.

Between 2012 and2016, confirmed gambling-related PayPal transfers into the

Clinton Reider-related bank accounts totaled $1 53,7

32.

00.

93 .49

.

The sum total of cash deposits ($408,869.10), gambling-confirmed check deposits

($266,826.00) and gambling-confirmed PayPal transfers ($153,793.49) into the Clinton Reiderrelated bank accounts totaled $829.488.59.

33.

Clinton Reider also concealed check and cash proceeds of the illegal gambling

operation by commingling the funds into his parents' bank accounts. The funds deposited into

 Case: 1:19-cv-01949-PAB Doc #: 1 Filed: 08/26/19 7 of 10. PageID #: 7

Joy Reider's and Michael Reider's bank accounts were used, inter alia,to make payments
toward the mortgage on the defendant property and to pay expenses (approximately $80,526.20)

toward the construction of the defendant lakefront residence.

34.

From 2017 to 2076, a total of approximately $202,206.00 was paid toward the

mortgage on the defendant property. Approximately $64,999.00 of this amount was paid from

Clinton Reider-related bank accounts. Many of the remaining payments - that were made from
Joy Reider's and Michael Reider's bank accounts - have corresponding deposits connected to

Clinton Reider's illegal gambling activity. These corresponding deposits appear to be very
similar to the amount of the mortgage due and correspond with the due date of the mortgage
payment.

35.

On or about January 16,2018, a release/satisfaction of the mortgage on the

defendant property was filed with the Lake County, Ohio, Recorder.

36.

Since 2073, a total of approxim ately 28 contractors have been paid a total

of

$771,069.31 to complete work on the defendant lakefront residence. Of this total, $406,278.64
was paid in cash to the contractors by Clinton Reider. Checks drawn on the Clinton Reider-

related bank accounts totaling $172,209.27 also were used to pay construction expenses.

37.

Clinton Reider concealed the payment of an additional approximately $93,537.20

of the construction costs for the defendant lakefront residence by using the credit card of a coconspirator of the illegal gambling operation/former professional baseball player.

Transactions in Excess of $10,000.00 Conducted by Clinton Reider

38.

The following transactions in excess of $10,000.00 were paid to contractors using

funds from the Clinton Reider-related bank accounts for the construction of the defendant

lakefront residence:

 Case: 1:19-cv-01949-PAB Doc #: 1 Filed: 08/26/19 8 of 10. PageID #: 8

a.)

On or about June 7, 2014, Clinton Reider made payment toward the construction

of the defendant lakefront residence to Integrity Construction in the amount of $16,500.00 with a
check from his personal bank account. Integrity Construction did foundation/framing work at
the defendant lakefront residence.

b.)

On or about July 21,2016, Clinton Reider made payment toward the construction

of the defendant lakefront residence to Conor Services in the amount of $36,572.00 with a check
from his personal bank account. Conor Services did interior finishing work at the defendant
lakefront residence.

c.)

On or about December 9,2015, Clinton Reider made payment toward the

construction of the defendant lakefront residence to Preferred Insulation in the amount

of

$19,245.00 with a check from his "business" bank account.

d.)

On or about February 2,2016, Clinton Reider made payment toward the

construction of the defendant lakefront residence to Conor Services in the amount of $14.575.00

with a check from his "business" bank account.

CONCLUSION

39.

By reason of the foregoing, the defendant property is subject to forfeiture to the

United States under 18 U.S.C. $ 981(a)(l)(C) in that it constitutes
proceeds traceable to violation(s)

-

or is derived from

-

of l8 U.S.C. $ 1084 (transmission of gambling information)

and l8 U.S.C. $ 1955 (illegal gambling businesses).

40.

By reason of the foregoing, the defendant property also is subject to forfeiture to

the United States under l8 U.S.C. $ 981(aX1)(A) in that it was involved in a transaction(s) in

violation of 18 U.S.C. $ 1957 (money laundering), or is property traceable to such property.

 Case: 1:19-cv-01949-PAB Doc #: 1 Filed: 08/26/19 9 of 10. PageID #: 9

WHEREFORE, plaintiff, the United States of America, respectfully requests that this
Court enter judgment condemning the defendant property and forfeiting it to the United States,
and providing that the defendant property be delivered into the custody of the United States for

disposition according to law, and for such other relief as this Court may deem proper.
Respectfu

lly submitted,

Justin E. Herdman
U.S. Attorney, Northem District of Ohio

States Attorney,

N.D. Ohio

Carl B. Stokes U.S. Court House
801 West Superior Avenue, Suite 400
Cleveland, Ohio 44113
216.622.37 43 I F ax: 21 6.522.7 499
James.Morford@usdoj gov
.

9

 Case: 1:19-cv-01949-PAB Doc #: 1 Filed: 08/26/19 10 of 10. PageID #: 10

VERIFICAT10N
STATE OF OHIO
COUNTY OF CUYAHOGA)

)
)SS.

I,Jamcs Lo Morford,undcr pcnalty ofpeJury,deposc and say that l am an Assistant
United States Attomey forthe Northem E)istrict of Ohio,and the attomey for the plaintiffin the
within entitled action. The foregoing Complaint in Forfeiture is based upon infollllation
offlcially providcd to lne and,to my knowlcdge and beliet iS true and correct.

tates Attorney,N.D.Ohio

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