Fraudster Tries to Reduce His Sentence by Continuing His Fraud
Post number 5267
Read the full article at https://lnkd.in/gn6SUUqV, see the video at https://lnkd.in/g4PiYrAp and at https://lnkd.in/giHCPFAw, and at https://zalma.com/blog plus more than 5250 posts.
In Spite of Defendants Claims He Will Spend Serious Time in Prison
In United States Of America v. Henry Ford, Criminal Action No. 23-130, United States District Court, E.D. Pennsylvania (January 5, 2026) Henry Ford (no relation to the creator of the Model T), also known as “Cleothus Lefty Jackson,” was indicted and pled guilty to one count of securities fraud and aiding and abetting, along with seven counts of wire fraud.
FACTUAL BACKGROUND
Defendant falsely represented to victims that a business he controlled, Fallcatcher, had “pilot approvals in writing” with two large insurance companies and that several states “want the [Fallcatcher] technology” [Count Five]. In reality, Fallcatcher did not have any pilot programs with insurance companies and the Letter Of Intent was not a legitimate document.
Ford founded and operated several Fallcatcher entities, holding various executive roles, and purportedly used some of the funds to promote the business and hire employees.
Ford orchestrated a fraudulent investment scheme involving the sale of securities tied to companies he controlled, collectively known as “Fallcatcher.” The scheme defrauded 61 victims out of nearly $5 million. The SEC recovered and returned a portion of the funds, but over $2 million in restitution remains outstanding.
Approximately sixty-one (61) investor victims invested $4,964,775.79 in Fallcatcher, in return for shares of Fallcatcher’s common stock at a price of $.50 per share. These investments constituted the purchase of securities. And although Defendant did not have access to the investment proceeds located in Fallcatcher bank accounts, bank records reflected that Defendant and his wife received approximately $493,000 in payments from Fallcatcher after the proceeds were in the accounts.
The Present Criminal Case
In the instant criminal case a grand jury returned an eight-count Indictment against Defendant. On May 13, 2025, Defendant pled guilty to all charges in the Indictment, pursuant to a written plea agreement. The parties agreed, pursuant to Federal Rules of Criminal Procedure 11(c)(1)(C), that a sentence of imprisonment between forty-six (46) and seventy-eight (78) months is the appropriate disposition of this case.
Legal Issues & Sentencing
The sentencing in this case centers on the calculation of “loss” under § 2B1.1 of the United States Sentencing Commission Guidelines. The court clarified that “loss” means the actual harm suffered by victims. This means that any money recovered and returned to victims should be deducted from the loss calculation.
Analysis/Discussion
First, the money recovered by the SEC and returned to victims was deducted from the loss calculation, as only the net loss actually suffered by victims is relevant to a sentencing court.
Second, the court rejected the argument that funds not returned but used for “legitimate business purposes” should be excluded from the loss calculation. The rationale is that such expenditures, even if ostensibly for business operations, do not offset the loss suffered by victims, as the funds were obtained through fraud.
Fraud Loss Calculation in the Presentence Report
In the Presentence Report (“PSR”), the Probation Officer set the applicable fraud loss at $4,964,775.79. Since the loss exceeded $3,500,000, but was less than $9,500,000,” eighteen (18) offense levels were added.
Defendant Ford objected to the loss amount. The Court found that under § 2B1.1 of the Sentencing Guidelines: (1) the money returned to the victims by the SEC is not included in the amount of “actual loss”; and (2) the remainder of investment funds apparently used for “legitimate business expenses” are not excluded from “actual loss.”
The Government argued that because Defendant’s misrepresentations successfully resulted in investors transferring approximately $4.9 million to Fallcatcher Inc., Defendant caused “actual loss” in that amount once the funds were out of the victims’ possession.
Since the $2,095,480.38 balance was actually lost by the victims, he received no credit. The defendant has clearly demonstrated acceptance of responsibility for the offense. Accordingly, the offense level is decreased by two levels. The defendant has assisted the authorities in the investigation or prosecution of the defendant’s own misconduct by timely notifying authorities of the intention to enter a plea of guilty. Accordingly, the offense level is decreased by one additional level.
Total Offense Level: 24
In conclusion the court concluded that at Offense Level of 24, with a Criminal History Category of II, the guideline range for imprisonment is fifty-seven (57) to seventy-one (71) months.
ZALMA OPINION
Fraudsters, even when arrested and convicted with a guilty plea insist on drawing courts into lengthy opinions to support the serious sentence the fraud perpetrator using a famous person’s name as his own, will be sentenced – contrary to his objections, between 57 and 71 months in prison for his fraud.
(c) 2025 Barry Zalma & ClaimSchool, Inc.
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See the full video at https://lnkd.in/gWQQEySW and at https://lnkd.in/gyhdK6wv
This is a Fictionalized True Crime Story of Insurance Fraud explaining why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers. The story is one of a collection designed to help to Understand How Insurance Fraud in America is Costing Everyone who Buys Insurance Thousands of Dollars Every year and Why Insurance Fraud is Safer and More Profitable for the Perpetrators than any Other Crime.
This is a Fictionalized True Crime Story of Insurance Fraud explaining why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers. The story is one of a collection designed to help to Understand How Insurance Fraud in America is Costing Everyone who Buys Insurance Thousands of Dollars Every year and Why Insurance Fraud is Safer and More Profitable for the Perpetrators than any Other Crime.
After ...
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Post 5397
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See the video and at https://lnkd.in/gNUs2XzT and at https://lnkd.in/g2MawyzX
Magistrate Issues a Search Warrant if there is a Fair Probability that Contraband or Evidence of a Crime will be Found in a Particular Place.
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As part of the investigation, the FBI obtained an August 19, 2022 warrant to search Driscoll’s Sterling Pharmacy Yahoo email account for emails from January 1, 2018 through December 31, 2020. Driscoll moved to suppress the resulting evidence, arguing that the warrant lacked probable cause, was overbroad, and rested on material misstatements and omissions.
LAW:
The ...
Fraud Shouldn’t Pay
Post 5396
See the video and at https://rumble.com/v7ctgmq-the-great-jewel-theft.html at https://youtu.be/aRbQ2sJfGwA
This is a Fictionalized True Crime Story of Insurance Fraud explaining why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers. The story is one of a collection designed to help to Understand How Insurance Fraud in America is Costing Everyone who Buys Insurance Thousands of Dollars Every year and Why Insurance Fraud is Safer and More Profitable for the ¬¬¬Perpetrators than any Other Crime.
The Insured purchased, for the first time in his life, a policy of Personal Articles Floater Insurance (PAF) scheduling $125,000 worth of ladies jewelry. He advised the insurer that the jewelry was always kept in a class E safe at his residence. He also told the insurer that he was employed full time as the owner of a gasoline service station and that he had never been canceled or suffered a previous loss.
One month after the policy was ...
Day Care Owner Loses Subsidies Because She Criticized State
Post 5421
Posted on August 11, 2026 by Barry Zalma
First Amendment Right Will be Allowed to Go to Trial
In Betsey J. Grant v. Maine State Department Of Heath And Human Services, No. 1:25-cv-00490-JAW, United States District Court, D. Maine (August 6, 2026), Betsey J. Grant, a licensed childcare provider and operator of Tiny Tikes Daycare in Trenton, Maine, sued Maine DHHS and several employees after she publicly criticized DHHS before Maine’s Government Oversight Committee and alleged that officials retaliated against her.
She claimed DHHS imposed and extended a conditional license, published stigmatizing information, interfered with subsidies and program funding, removed her from a food program, rescinded an expansion grant, and used biased or falsified evidence in licensing proceedings. Following the March 10, 2023, GOC testimony, Ms. Grant alleges that foster children's subsidies (approximately $30,000) were withheld; she was removed from the ...
Rescission for Material Misrepresentation
Post 5418
Posted on August 5, 2026 by Barry Zalma
An Insurer May Rescind An Insurance Policy Where The Applicant Made A Material Misrepresentation In The Application.
In Union Mutual Fire Insurance Company v. 844 Knickerbocker, LLC, et al. No. 2024-10359, Index No. 602824/22, 2026 NY Slip Op 04789, Supreme Court of New York, Second Department (July 29, 2026) Union Mutual Fire Insurance Company issued commercial insurance policies to 844 Knickerbocker, LLC, and Sanjaya Mallick based on applications stating that the insured property contained two apartment units. After an underlying personal injury action was filed, Union Mutual determined that the property actually contained three apartment units and rescinded the policies on the ground that the defendants had made a material misrepresentation in the applications.
LAW:
A misrepresentation is material if the insurer would not have issued the same policy, or would have issued it only on different terms, had the true ...
Rescission for Material Misrepresentation
Post 5418
Posted on August 5, 2026 by Barry Zalma
An Insurer May Rescind An Insurance Policy Where The Applicant Made A Material Misrepresentation In The Application.
In Union Mutual Fire Insurance Company v. 844 Knickerbocker, LLC, et al. No. 2024-10359, Index No. 602824/22, 2026 NY Slip Op 04789, Supreme Court of New York, Second Department (July 29, 2026) Union Mutual Fire Insurance Company issued commercial insurance policies to 844 Knickerbocker, LLC, and Sanjaya Mallick based on applications stating that the insured property contained two apartment units.
LAW:
A misrepresentation is material if the insurer would not have issued the same policy, or would have issued it only on different terms, had the true facts been disclosed. To establish materiality as a matter of law, the insurer must submit documentation of its underwriting practices, such as manuals, guidelines, bulletins, or rules addressing similar risks.
DISCUSSION/ANALYSIS:
As a result, the...
