By Eric Freedman
A participant in a recycling fraud conspiracy in New York has been sentenced to 18 months in prison and ordered to repay $144,216 to the cheated victims.
David Frisby had pleaded guilty to conspiracy to commit fraud by soliciting contracts to dispose of batteries and other waste metal under false pretenses.
“From February 2012 to January 2014, Frisby and others defrauded scrap metal brokers and others in the metal recycling industry by charging them for scrap metal recycling services that were never provided,” according to the plea agreement.
He now lives in Mississippi.
“Frisby admitted that he and his coconspirators falsely held themselves out to be representatives of a scrap metal recycling firm that was authorized by the Environmental Protection Agency to dispose of metal waste by shipping it to Korea, and that they defrauded businesses and individuals by charging them for recycling services that were never provided,” the U.S. Attorney’s office said in a press statement announcing the sentence imposed by U.S. District Judge Glenn Suddaby.
“In reality, Frisby and his coconspirators were not authorized by the EPA to provide scrap metal recycling services and never intended to provide such services,” the statement said.
Nobody else has been charged, said Michael Barnett, a public affairs officer for the U.S. Attorney’s office in Albany.
The scheme ripped off at least nine businesses and individuals.
Victimized businesses received false documentation purporting to show that the conspirators worked for a recycling company called MVP Trading Co. The real MVP Trading distributed health and beauty products, and wasn’t in the scrap metal business.
Frisby is the former chief executive officer of D&L Heritage Enterprises Inc., a Fultonville, New York, company that folded in 2009. As part of the scheme, the conspirators fraudulently changed D&L Heritage’s incorporation-related documents and emailed them to victims to make MVP Trading seem legitimate.
In one phony deal described in court papers, MVP Trading contracted to ship 200 tons of scrap metal from drained batteries to Korea for $44,000, but didn’t do so.
The conspirators used forged documents, including bogus papers from a state agency, a letter purportedly from the EPA and an EPA certification supposedly authorizing MVP Trading to carry out lead-based testing activities.
“At no time did the EPA authorize MVP Trading to ship scrap metals overseas,” the plea agreement said.
The prosecution said Frisby’s involvement “lent the scheme the appearance of legitimacy,” and MVP Trading used Frisby’s former home address as a “false business address.”
He kept 10 percent of the proceeds and transferred the rest to his co-conspirators, the plea agreement said.
In arguing for leniency, Frisby said he got involved in the scheme “innocuously” though someone who identified himself as a lawyer named “Barrister Cole Morgan” and claimed he “took direction from Morgan and followed his instructions regarding when to transfer money, who to transfer money to and for what amount,” Frisby’s sentencing memorandum said.
The name “Barrister Morgan Cole” with a United Kingdom phone number shows up on the scamwarners.com website.
The conspirators also used another apparently bogus name, “Krus Hardy,” in sending emails to an undercover officer of the New York Department of Environmental Conservation. The investigator was posing as an associate of a Chicago scrap broker.
Frisby stayed in the conspiracy “out of financial desperation” because Hurricane Katrina in 2005 “left him devoid of property and financially in ruins,” and living “hand to mouth,” his sentencing memorandum said.
“Frisby did not instigate or possess a leadership role in the conspiracy,” the memorandum argued.
His defense lawyer, Randi Bianco of Syracuse, said Frisby hasn’t’ authorized her to discuss the case.
The maximum sentence for the crime is 20 years in prison and a $250,000 fine.