Derek R. Schwartz, Conspiring to Defraud Lenders, New York 2024

Derek R. Schwartz, a 52-year-old man from Coppell, Texas, has been accused of conspiring with ValueWise CEO Michael T. Mann to defraud companies that loaned millions of dollars to ValueWise subsidiaries.

According to an indictment, Mann obtained millions of dollars in loans from two financing companies, located in New York and Colorado, by falsifying his companies’ receivables. Mann falsely told the financing companies that Minnesota-based UnitedHealth Group Incorporated (“UHG”), and its subsidiary OptumInsight Inc. (“Optum”), owed millions of dollars to his companies.

Schwartz was a high-level executive at Optum, and then began working for ValueWise in about October 2013. Until about August 2016, he operated TrueHR, LLC, a ValueWise subsidiary based in Dallas, Texas. Schwartz allegedly conspired with Mann to defraud lenders by creating fake invoices and assigning them to the financing companies as collateral for loans.

The indictment also alleges that Schwartz recruited a UHG/Optum employee, Luke Steiner, to falsely represent to the financing companies that the fake invoices created by Mann were valid and payable by Optum. With Schwartz’s encouragement and direction, Steiner regularly made these false verifications for six years, ending in August 2019.

Schwartz faces up to 20 years in prison, and up to 3 years of post-imprisonment supervised release, if convicted of any of the charges in the indictment. The charges against Schwartz include conspiring to commit wire fraud, and four counts of wire fraud. He will be arraigned at a later date.

Mann, who has already pleaded guilty to various crimes in connection with his fraudulent scheme, was sentenced earlier this month to 144 months in prison. Steiner, a 33-year-old man from Minneapolis, Minnesota, pleaded guilty in February 2020 to conspiring with Mann, and is pending sentencing.

The case is being investigated by the FBI, and is being prosecuted by Assistant U.S. Attorneys Michael Barnett and Cyrus P.W. Rieck. The indictment was made public yesterday by Acting United States Attorney Antoinette T. Bacon and Janeen DiGuiseppi, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI).

Source: https://www.justice.gov/usao-ndny/pr/texas-man-charged-conspiring-michael-mann-defraud-lenders