Related Federal Cases
Jacksonville Man Convicted of $5 Million Conspiracy and Wire Fraud
A federal jury has found Justin Pennington, a 30-year-old resident of St. Johns County, guilty of one count of conspiracy and nine counts of wire fraud.
According to evidence presented at trial, while Pennington was employed as an Information Technology Director at The Wholesale House, an Ohio-based company with offices in Jacksonville, he and his co-conspirators created a fraudulent company, 3 Kings, LLC.
3 Kings was incorporated in Delaware in an attempt to conceal the identity of the owners who purchased products from The Wholesale House at or near cost and then resold those products to consumers and retailers. Unbeknownst to the owners of The Wholesale House, 3 Kings illegally competed with The Wholesale House’s customers and thereby caused significant financial difficulties for the company’s legitimate customers.
In total, 3 Kings purchased nearly $40 million of products from The Wholesale House and never paid the entirety of its bills owed to them. Instead, Pennington and his co-conspirators spent tens of thousands of dollars themselves, with Pennington incurring credit card balances of up to $100,000 per month, while owing his employer millions of dollars.
During the trial, Pennington’s co-conspirators testified that he was the mastermind of the scheme, created detailed proposals, named the corporation, incorporated the company, and controlled the corporation’s bank accounts. The Wholesale House owners testified that they had personally infused more than $7 million into the company to ensure its survival and to protect the jobs of the company’s more than 60 employees.
The case was investigated by the Federal Bureau of Investigation (FBI) and prosecuted by Assistant United States Attorneys Mark Devereaux and Jason Mehta. Pennington faces up to 20 years in federal prison on each count and mandatory restitution of approximately $5 million. His sentencing hearing has been scheduled for August 2, 2017.
This case is a stark reminder of the devastating impact of white-collar crime on businesses and communities. The Wholesale House’s owners had to infuse millions of dollars into their company to keep it afloat, while Pennington and his co-conspirators reaped the benefits of their scheme.
The FBI and the U.S. Attorney’s Office will continue to work tirelessly to investigate and prosecute these types of crimes, bringing justice to victims and holding perpetrators accountable for their actions.
Key Facts
- State: Florida
- Category: White Collar Crime
- Source: DOJ Press Release â†â€â€
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