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posted by martyb on Friday March 30 2018, @05:59AM   Printer-friendly
from the your-gets-you's-money-you-takes-you's-chances dept.

Greenbelt, Maryland – A federal grand jury has indicted Katrin Verclas, age 50, a native and citizen of Germany residing in Washington, D.C., on a charge related to a scheme to defraud the U.S. Department of State of $1.231 million. The indictment was returned on March 26, 2018, and was unsealed upon the arrest of Verclas.

The indictment was announced by Acting United States Attorney for the District of Maryland Stephen M. Schenning and Steve A. Linick, Inspector General for the U.S. Department of State.

According to the indictment, Verclas, as director of MobileActive Corp, obtained a grant from the U.S. Department of State intended to support and promote U.S. global internet freedom efforts. Verclas represented to the U.S. Department of State that MobileActive was a non-profit organization pursuant to 26 U.S.C. § 501(c)(3) with the legal authority to apply for a grant, and that MobileActive had the financial capability to ensure proper planning, management, and completion of the grant project.

MobileActive was not a 501(c)(3) non-profit organization, and thus, did not have the legal authority to apply for the grant. Verclas spent much of the money from the U.S. Department of State on personal expenses and expenses unrelated to the grant. Verclas caused the U.S. Department of State to transfer $1.222 million into her control.

Verclas faces a maximum sentence of 10 years in prison.

Source: https://www.justice.gov/usao-md/pr/german-citizen-indicted-major-fraud-connection-state-department-grant


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  • (Score: 2) by MostCynical on Friday March 30 2018, @06:55AM

    by MostCynical (2589) on Friday March 30 2018, @06:55AM (#660297) Journal

    she should have stolen billions, then the government would have helped pay her bonus.

    --
    "I guess once you start doubting, there's no end to it." -Batou, Ghost in the Shell: Stand Alone Complex
  • (Score: 3, Insightful) by frojack on Friday March 30 2018, @07:10AM

    by frojack (1554) on Friday March 30 2018, @07:10AM (#660300) Journal

    She didn't apply the funds properly.
    1/3 was to go back to various government employees or elected officials as bribes.
    Another third flying congressmen on junkets.

    Had that been done nobody would worry about where the rest went.

    --
    No, you are mistaken. I've always had this sig.
  • (Score: 2) by MichaelDavidCrawford on Friday March 30 2018, @07:21AM (1 child)

    by MichaelDavidCrawford (2339) Subscriber Badge <mdcrawford@gmail.com> on Friday March 30 2018, @07:21AM (#660306) Homepage Journal

    A trivial way to determine that would have been to ask the state Department Of State where MobileActive is incorporated. My understanding is that non-profits are also required to publicly publish annual financial statements.

    This leads me to suggest that the Federal Department Of State is getting fleeced for quite a lot more than a million.

    Maybe I'll apply for such a grant. I prefer to tip generously.

    --
    Yes I Have No Bananas. [gofundme.com]
    • (Score: 4, Interesting) by VLM on Friday March 30 2018, @04:02PM

      by VLM (445) Subscriber Badge on Friday March 30 2018, @04:02PM (#660414)

      The ridiculous part is she was busted for not filing her 501(c)(3) corp paperwork, the other stuff is very handwavy fuzzy and probably not realistically prosecutable unless its glaringly ridiculous. Which it may have been. Note that people really freak the hell out if you directly bill your company $10K to go on vacation, but if you pay $10K in salary and use it to go on vacation its no big deal.

      My wife has a buddy who set up a 501(c)(3) for a handicapped kids service, etc, irrelevant to this topic anyway I got involved in advising her because I run a (non-501c3) LLC and have also done non-profit volunteer treasurer stuff prior to her contacting professionals to do the work, anyway my advice that turned out well was the floor cost to set up a 501(c)(3) is about $2K in my state although depending on how much work you want to outsource or which state or city you live in the legal costs could be quite a bit more. I would be surprised if from ground zero someone spent more than $5K regardless where they live to set up a 501(c)(3). Obviously the more complex your structure, the more its gonna cost, so something of infinite complexity could cost infinite money, in theory.

      As an example of how costs can vary, you can pay from $5 to $500 to motivate someone to go to the IRS EIN website, fill out a form with like 5 lines, it takes about 5 minutes, then you get a EIN number, all at zero cost. I did it myself, for free, for my consulting group's LLC, but you can pay up to $500 to someone else to make the problem go away, perhaps your state's agent lawyer would do that for you for two billable hours at $250/hr, but why bother?

      Anyway my point is she was really dumb by saving maybe four digits of $$$$ not filing paperwork then getting arrested over income of seven digits of $$$$$$$, which is kinda stupid. She could have made that whole category of problem go away for far less than one percent of her total haul. Most people not being that incredibly unbelievably stupid, my guess is there's going to be a shitstorm at the trial where she signed all the paperwork but her lawyer failed to send it via registered mail and it got lost and nobody noticed, or some ridiculous story like that. Possibly the story will even be true, by some points of view, anyway.

  • (Score: 2) by MichaelDavidCrawford on Friday March 30 2018, @07:22AM (1 child)

    by MichaelDavidCrawford (2339) Subscriber Badge <mdcrawford@gmail.com> on Friday March 30 2018, @07:22AM (#660307) Homepage Journal

    Such as suggesting that foreign search engines disable autocompletions for "kodi"?

    Wake me up when the US has the moral authority to lecture the people of other nations on the topic of freedom. I could really use that much rest.

    --
    Yes I Have No Bananas. [gofundme.com]
    • (Score: 2) by HiThere on Friday March 30 2018, @06:28PM

      by HiThere (866) Subscriber Badge on Friday March 30 2018, @06:28PM (#660464) Journal

      So you're planning to outdo Rip Van Winkle?

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