Just saw this article at OSGA......
****** took $280,000, feds say
By Elliot Grossman - mcall.com
Apr 16, 2004, 12:36
Former star athlete George ****** of Allentown, convicted of gambling charges 19 months ago, is facing new federal charges involving bankruptcy fraud.
A federal grand jury accused ****** on Wednesday of embezzling about $280,000 from his real estate business, which was supposed to be under the control of a bankruptcy court.
****** said Wednesday he didn't know about the charges. ''It sounds absurd and bizarre,'' he said. ''I have no idea what they're even talking about.''
He called the charges ''frivolous'' and accused federal prosecutors of a ''witch hunt'' against him. ''It seems like the government is trying to scrutinize everything I've done.''
****** was supposed to report to federal prison in March 2003 to serve a 15-month sentence for the gambling conviction. But a federal judge allowed him to remain free until an appeals court rules on the case. That appeal is still pending.
In the bankruptcy case, the grand jury charged him with embezzlement from a bankruptcy estate and concealment of bankruptcy estate assets. That means he allegedly took money that could have gone to pay creditors and tried to hide his actions.
According to the indictment, he was the president and co-owner of Quality Realty Construction Inc. when it sold a downtown Allentown building in 1996 for $425,000. The new owner agreed to make 60 monthly payments ending in 2001.
In February 1997, Quality Realty filed for bankruptcy protection, meaning a bankruptcy court would have to approve withdrawals from the company's bank accounts.
But from March 1997 to August 2000, ****** allegedly made withdrawals totaling $280,000 that were not authorized by the bankruptcy court. The bankruptcy court had not authorized any withdrawals, except to attorneys.
To conceal funds, according to the indictment, ****** submitted false monthly financial reports to the bankruptcy court. He allegedly created false inflated account balances by writing checks with insufficient funds.
If convicted of bankruptcy fraud, ****** could be given a prison term and a fine.
On Wednesday, ****** said the investigators could have dealt with the issues by asking him questions about the bankruptcy case.
''It seems to me like there's a lot of confusion and once the confusion is resolved we can come to the bottom of this,'' he said. ''It seems to me that an issue like this could have been resolved out of court.
''As far as I know, I'm innocent of all the charges. … Anybody who knows me knows I'm not going to do anything intentionally to harm anybody. That's not the way I was raised.''
******, 45, was a star wrestler and football player at Dieruff High School and Louisiana State University. He later played briefly for several professional football teams.
He also is known for renovating old buildings, then selling or leasing them. In addition, he owned Allentown's Acorn Hotel.
This is the second time that the U.S. attorney's office in Philadelphia has pursued charges against him.
In September 2002, he was convicted of 15 criminal counts involving his sports betting business. After a two-week trial, the jury convicted him of running a gambling business in violation of Pennsylvania law, using telephone lines to take bets, conspiracy and money laundering.
****** advertised his business, International Casino, as an offshore operation in the Caribbean, where gambling is legal. But he also had an office in Pennsylvania, where such sports betting is illegal.
International Casino accepted bets on college and professional sports, taking in more than $1 million in 14 months from 1995 to 1997, according to prosecutors.
A judge dismissed more than half of the convictions, then ordered the 15-month prison term.
A year earlier, his brothers, Dennis and Joseph, were cleared of gambling-related charges in the same courthouse.
