PROVIDENCE, RI – A Connecticut man is facing years in federal prison after admitting he masterminded a brazen fraud scheme that bilked a Chicago-based debtor finance company out of over $3.6 million. Gerald Kent, 52, of Groton, CT, owner of the now-defunct Kent Jewelry in Johnston, RI, pleaded guilty today to wire fraud and aggravated identity theft, bringing to a close a case that exposed a sophisticated operation built on lies and deception.
Kent’s scheme revolved around the online sale of jewelry through popular sites like Groupon.com and Zulily.com. However, instead of honestly reporting sales, Kent allegedly fabricated hundreds of invoices, submitting them to the factoring company as legitimate receivables. This allowed him to pocket nearly $5 million in payments for goods he hadn’t actually sold. The operation wasn’t just about falsifying numbers; Kent went to elaborate lengths to create the illusion of legitimacy.
Federal investigators uncovered that Kent didn’t simply forge invoices – he constructed a complete facade. He created a fraudulent clone of Groupon’s website, recruited accomplices to pose as Groupon employees, and even opened bank accounts in the names of Groupon and Zulily, Inc. This was a calculated effort to mislead the factoring company into believing payments were coming directly from these well-known brands. The factoring company, a key source of working capital for businesses, was essentially tricked into funding a phantom operation.
“Factoring” – the financial practice of selling accounts receivable at a discount – is intended to help businesses grow. Kent exploited this system, turning it into a personal slush fund. The U.S. Attorney’s Office, alongside agents from the U.S. Secret Service and the FBI, began investigating Kent after a criminal complaint was filed on July 17, 2017. He was released on a $50,000 unsecured bond on July 26, 2017, pending today’s guilty plea.
The penalties for Kent’s crimes are substantial. Wire fraud carries a maximum sentence of 20 years imprisonment and a fine of $250,000 (or twice the financial gain/loss). The aggravated identity theft charge adds a mandatory minimum consecutive sentence of 2 years, along with another potential $250,000 fine. Assistant U.S. Attorneys Lee H. Vilker and John P. McAdams are prosecuting the case, determined to see justice served.
Kent is scheduled to be sentenced on March 9, 2018. While the recovery of the $3.6 million remains uncertain, federal authorities are sending a clear message: exploiting financial systems and stealing from legitimate businesses will not be tolerated. The investigation, led by Brian Deck of the Secret Service’s Providence office and Harold H. Shaw of the FBI’s Boston Division, highlights the ongoing fight against white-collar crime and the dedication of law enforcement to holding fraudsters accountable.
Related Federal Cases
- George L. Wilson, Passport Fraud, Rhode Island 2024 · U.S. Virgin Islands
- Daniel E. Saad, Arson and Wire Fraud, Rhode Island 2014 · New Hampshire
- Card Cracking Scheme, Rhode Island 2024 · New Hampshire
- Dean Emmanuel Colin, ATM Cashout Scheme, Rhode Island 2024 · Pennsylvania
- Michael Johnson, Credit Card Fraud, Rhode Island 2024 · Texas
Key Facts
- Agency: U.S. Secret Service
- Category: Fraud & Financial Crimes
- Source: Official Press Release
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