On August 2, 2023, FRANK LABRUZZO and CYNTHIA CARONNA were charged with conspiracy to commit wire fraud in violation of federal law. The charges stem from their alleged involvement in defrauding a business seeking to purchase personal protective equipment (PPE) during the height of the COVID-19 pandemic. LABRUZZO, CARONNA, and a resident of the United Kingdom purportedly formed a business venture to sell PPE, with LABRUZZO acting as the escrow agent. They allegedly deceived potential buyers by presenting LABRUZZO as a trustworthy agent who would safeguard their funds until the PPE was delivered. However, it is alleged that LABRUZZO disbursed the funds to various entities, including himself and CARONNA, without the buyers receiving the PPE or consenting to the disbursements. If convicted, the defendants face significant penalties, including imprisonment and fines. The case is being investigated by the Federal Bureau of Investigation, and Assistant U.S. Attorney Chandra Menon is handling the prosecution.
I. Charged Individuals and Allegations
A. Introduction to FRANK LABRUZZO and CYNTHIA CARONNA
Frank Labruzzo and Cynthia Caronna have been charged with conspiracy to commit wire fraud in violation of Title 18, United States Code, Sections 1343 and 371. Labruzzo, Caronna, and a resident of the United Kingdom are accused of defrauding a business during the height of the COVID-19 pandemic. Labruzzo, a former attorney and investigator with the Louisiana Attorney General’s Office, was selected to be the escrow agent for a business venture formed by Caronna and the UK resident.
B. Conspiracy to commit wire fraud
The bill of information alleges that Labruzzo, Caronna, and the UK resident conspired to defraud a business seeking to purchase personal protective equipment (PPE) during the increased demand caused by the COVID-19 pandemic. Labruzzo was tasked with presenting himself as a trustworthy escrow agent to potential buyers of PPE, assuring them that their funds would be safely held in an escrow account until the PPE was delivered. However, it is alleged that Labruzzo dispersed the funds to various individuals and entities, including himself and Caronna, without the knowledge or consent of the buyers.
C. Relevant sections of the United States Code
Labruzzo and Caronna have been charged with conspiracy to commit wire fraud, which violates Title 18, United States Code, Sections 1343 and 371. These sections of the code define the illegal actions and penalties associated with wire fraud and conspiracy.
A. Demand for Personal Protective Equipment (PPE) during COVID-19 pandemic
The COVID-19 pandemic created an unprecedented demand for personal protective equipment (PPE). Businesses and individuals around the world were searching for adequate supplies to protect themselves and others from the spread of the virus. The increased demand led to an opportunity for fraudsters to exploit the situation and defraud buyers in need of PPE.
B. Formation of business venture
Caronna and the UK resident formed a business venture to offer the sale of PPE. Their intention was to provide a solution to the high demand by offering PPE for purchase. Labruzzo was chosen to be the escrow agent for the venture, responsible for receiving and safeguarding the funds from potential buyers.
C. Role of LABRUZZO as escrow agent
Labruzzo, with his background as an attorney and investigator, was entrusted with the role of escrow agent. His role was to assure potential buyers that their funds would be held in an escrow account until the PPE was delivered. Labruzzo was supposed to act as a trustworthy intermediary, safeguarding the funds and ensuring their proper disbursement.
D. Alleged misrepresentation to buyers
The bill of information alleges that Labruzzo, Caronna, and the UK resident misled potential buyers of PPE. They allegedly presented Labruzzo as a reliable escrow agent, assuring buyers that their funds would be protected until the PPE was delivered. However, it is alleged that Labruzzo dispersed the funds without the consent or knowledge of the buyers, and despite the fact that the PPE was not satisfactorily delivered.
E. Disbursements of funds
Labruzzo, at the direction of Caronna, allegedly made various disbursements of the escrowed funds. These disbursements included payments to Labruzzo and Caronna themselves, as well as other individuals and entities. The bill of information asserts that Labruzzo and Caronna received portions of the funds without the knowledge or consent of the buyers.
III. Charges and Penalties
A. Overview of conspiracy charge
Labruzzo and Caronna have been charged with conspiracy to commit wire fraud. Conspiracy involves an agreement between two or more individuals to commit a criminal act. In this case, the alleged agreement was to defraud buyers of PPE by misrepresenting the role of Labruzzo as an escrow agent and dispersing the funds without consent.
B. Potential imprisonment, supervised release, and fines
If convicted of conspiracy to commit wire fraud, Labruzzo and Caronna could face penalties including up to five years in prison, followed by up to three years of supervised release. Additionally, they may be subject to fines of up to $250,000.
C. Mandatory special assessment fee
In addition to potential imprisonment and fines, Labruzzo and Caronna may also be required to pay a mandatory special assessment fee of $100. This fee is a standard requirement in federal criminal cases and helps fund various programs and initiatives within the criminal justice system.
IV. Legal Process and Burden of Proof
A. Explanation of bill of information
The charges against Labruzzo and Caronna were filed through a bill of information. A bill of information is a formal written accusation that outlines the charges against a defendant. It is an alternative to a grand jury indictment and is typically used when the defendant waives the right to a grand jury.
B. Requirement of guilt beyond a reasonable doubt
Labruzzo and Caronna are presumed innocent until proven guilty beyond a reasonable doubt. This is the standard burden of proof in criminal cases in the United States. The prosecution must present sufficient evidence to convince the judge or jury that the defendants are guilty of the charges beyond any reasonable doubt.
V. COVID-19 Fraud Enforcement Task Force
A. Establishment and purpose
In response to the COVID-19 pandemic and the increased risk of fraud, the Attorney General established the COVID-19 Fraud Enforcement Task Force. The task force aims to enhance the efforts of the Department of Justice in combating and preventing pandemic-related fraud.
B. Collaboration with government agencies
The COVID-19 Fraud Enforcement Task Force collaborates with various government agencies to investigate and prosecute individuals and organizations involved in fraudulent activities related to the pandemic. By leveraging the resources and expertise of these agencies, the task force bolsters the government’s ability to hold perpetrators accountable and protect the public from fraud.
C. Investigation and prosecution of domestic and international criminals
The task force focuses on investigating and prosecuting both domestic and international criminals involved in COVID-19-related fraud. This includes individuals and organizations that attempt to defraud individuals, businesses, and government programs by exploiting the pandemic and its impact on society.
D. Prevention of fraud in relief programs
One of the key objectives of the COVID-19 Fraud Enforcement Task Force is to prevent fraud in relief programs established to provide assistance during the pandemic. By identifying and exposing fraudulent actors and schemes, the task force aims to safeguard the integrity of these programs and ensure that funds reach those in genuine need.
E. Resources and techniques for uncovering fraudulent actors and schemes
The COVID-19 Fraud Enforcement Task Force utilizes a wide range of resources and techniques to uncover fraudulent actors and schemes. This includes analyzing financial transactions, conducting undercover operations, leveraging data analytics, and collaborating with international partners. The task force constantly adapts and evolves its investigative methods to stay ahead of sophisticated fraud schemes.
VI. Reporting Fraud and Department of Justice’s Response to the Pandemic
A. National Center for Disaster Fraud (NCDF) Hotline
To report allegations of attempted fraud involving COVID-19, individuals can contact the National Center for Disaster Fraud (NCDF) Hotline. The NCDF is operated by the Department of Justice and serves as the main point of contact for reporting fraud related to natural and man-made disasters.
B. Reporting allegations of attempted fraud involving COVID-19
If you have information about attempted fraud involving COVID-19, you can report it to the Department of Justice through the NCDF Hotline. The NCDF Web Complaint Form is available on the Department of Justice’s website for individuals to provide details of the alleged fraud.
C. Department of Justice’s coordination and enforcement efforts
The Department of Justice plays a crucial role in coordinating and enforcing the federal government’s response to the COVID-19 pandemic. This includes investigating and prosecuting individuals and organizations involved in fraud, ensuring compliance with relief programs, and protecting the rights of individuals affected by the pandemic.
D. More information on the department’s response to the pandemic
For more information on the Department of Justice’s response to the COVID-19 pandemic, including its enforcement efforts and guidance for the public, you can visit their official website at www.justice.gov/coronavirus. The website provides comprehensive information on various initiatives, resources, and programs established by the department to address the challenges posed by the pandemic.
VII. Investigation and Prosecution
A. Involvement of the Federal Bureau of Investigation
The investigation into the alleged wire fraud conspiracy involving Labruzzo and Caronna is being led by the Federal Bureau of Investigation (FBI). As the primary federal law enforcement agency, the FBI has the jurisdiction and resources to handle complex and serious criminal cases, including those related to fraud.
B. Role of Assistant U.S. Attorney Chandra Menon
Assistant U.S. Attorney Chandra Menon, from the Public Integrity Unit, is responsible for prosecuting the case against Labruzzo and Caronna. As an experienced federal prosecutor, Menon is dedicated to ensuring the fair and just handling of the case, presenting evidence, and advocating for the interests of the United States.
The charges against Labruzzo and Caronna regarding their alleged involvement in defrauding a business seeking to purchase personal protective equipment during the COVID-19 pandemic highlight the importance of combating fraud and protecting vulnerable individuals and businesses. The COVID-19 Fraud Enforcement Task Force, alongside government agencies like the FBI, plays a critical role in investigating and prosecuting those involved in fraudulent activities related to the pandemic. The Department of Justice’s response to the pandemic includes efforts to prevent fraud, coordination with various agencies, and providing resources for reporting and addressing allegations of fraud. The legal process ensures that guilt is determined beyond a reasonable doubt, and the burden of proof rests with the prosecution. As the case progresses, the pursuit of justice and accountability will remain paramount, safeguarding public trust and deterring future fraudulent activities.