09-26-05 -- Bethune, Peter K. et al. -- Arrest/Indictment -- News Release

Four Men Indicted in Scheme to Extort Stock and Money Through the Use of Force and Violence

CAMDEN - Three men were arrested today and a fourth is being sought on a three-count federal Indictment in connection with their scheme to extort money and stock through the use of threats, violence and fear, U.S. Attorney Christopher J. Christie announced.

A federal Indictment unsealed with today's arrests, states that Peter K. Bethune, 43, of Maple Shade, a N.J. State Police Trooper, Francis N. Alexander III, 44, of Thorndale, Pa., an auto salesman, Brian H. Lavoe, 29, of Cherry Hill, a massage therapist and bar bouncer, and Christian L. Harper, 56, of Colorado and Vancouver, B.C., a securities promoter, conspired with each other and others to obstruct and affect commerce and the movement of articles and commodities in commerce by extortion.

Bethune, Alexander and Lavoe were arrested this morning by members of the FBI, IRS Criminal Investigation Division and the N.J. State Police. Harper is being sought. The three defendants had initial appearances before U.S. Magistrate Ann Marie Donio this afternoon. Judge Donio ordered the three defendants held in federal custody pending a detention hearing scheduled for Wednesday, Sept. 28 at 1:30 p.m.

Bethune is charged with all three-counts of the Indictment. Count One charges conspiracy to affect commerce by extortion, Count Two charges attempt to affect commerce by extortion of an individual identified as only K.W., and Count Three charges unlawful access to the FBI's National Crime Information Center and Interstate Identification Index ("FBI's NCIC/III computer system"). Alexander is charged in Counts One and Two. Both Harper and Lavoe are charged in Count One.

The Indictment alleges, that between December 1999 and June 2004, Alexander, Bethune and Lavoe agreed with an unindicted coconspirator, identified in the Indictment only as "Individual #1" and Harper to collect money and/or stock by extortionate means from stock promoters and corporate insiders who allegedly defrauded Individual #1 and Harper. According to the Indictment, Individual #1 is a resident of New Jersey and employed as a securities broker and promoter.

As part of the conspiracy, Alexander and Individual #1 incorporated New Alliance Corp. in New Jersey for the purpose of opening corporate brokerage accounts and bank accounts into which the proceeds of the extortion scheme were to be deposited and then used to pay members of the conspiracy. It was further part of the conspiracy that Alexander and Individual #1 opened a brokerage account in the name of New Alliance Corp. at Union Securities Ltd., located in Vancouver, British Columbia, into which stock acquired from the extortion scheme was deposited and then sold. Bethune and Lavoe also opened brokerage accounts in their names at Union Securities Ltd., which stock acquired from the extortion scheme was deposited and then sold.

The Indictment describes three attempts to extort money and/or stock. In one such attempt, according to the Indictment, Individual #1 employed Alexander and Bethune to collect money and/or stock by extortionate means from a corporate insider/stock promoter who had allegedly defrauded Individual #1. Alexander, Bethune and Individual #1 traveled from Atlantic City to West Palm Beach, Fla. in order to extort money or stock from the corporate insider. After arriving in Florida, Alexander and Bethune threatened a business associate of the corporate insider in order to compel the corporate insider to pay money or transfer stock to Individual #1, according to the Indictment.

Thereafter, according to the Indictment, Bethune and Individual #1 met with the corporate insider and others at which time the corporate insider agreed to provide Individual #1 with 200,000 shares of a publicly traded company in which the corporate insider was an officer. Consequently, the corporate insider caused 200,000 shares of the stock to be transferred to Individual #1. Thereafter, Individual #1 caused a portion of the shares to be transferred to Bethune as payment for his participation in the conspiracy.

The Indictment also describes how Alexander, Bethune and Lavoe traveled to Las Vegas and Los Angeles to extort two others persons identified as stock promoters through the use of threats.

Additionally, the Indictment describes an attempt by Alexander and Bethune to collect money through extortionate means from an individual identified as K.W., an undercover federal agent posing as a stock promoter and corporate insider who supposedly had previously defrauded Individual #1. According to the Indictment, Alexander and Bethune met with K.W. on two occasions and ordered and threatened K.W. to pay Individual #1 between $175,000 and $250,000. According to the Indictment, Alexander and Bethune agreed to allow K.W. to pay Individual #1 in installments over a period of months. Alexander and Bethune threatened violence against K.W. if he failed to make payments to Individual #1.

According to the Indictment, once K.W. failed to make payments to Individual #1, Alexander and Bethune made several attempts to locate K.W. for the purpose of completing the extortion scheme. As part of his effort to locate K.W., Bethune directed a law enforcement officer with the Delaware River Port Authority, identified only as Individual #2, to conduct an unlawful NCIC/III record check of K.W.'s criminal history.

The conspiracy charge carries a maximum penalty of 20 years in prison and a fine of $250,000 or twice the aggregate loss to the victims or gain to the defendants. Count Two of the Indictment, which charges attempted extortion, carries a maximum penalty of 20 years in prison and a fine of $250,000. Count Three of the Indictment charging unlawful access to the FBI's NCIC/III computer system carries a maximum penalty of 5 years in prison and a fine of $250,000.

In determining an actual sentence, the judge to whom the case is assigned would, upon a conviction, consult the U.S. Sentencing Guidelines, which provide appropriate sentencing ranges that take into account the severity and characteristics of the offense, the defendant's criminal history, if any, and other factors. The judge, however, is not bound by those guidelines in determining a sentence.

Parole has been abolished in the federal system. Defendants who are given custodial terms must serve nearly all that time.

Despite Indictment, every defendant is presumed innocent, unless and until found guilty beyond a reasonable doubt, following a trial at which the defendant has all of the trial rights guaranteed by the U.S. Constitution and federal law.

Christie credited Special Agents of the FBI's Atlantic City Resident Agency, under the direction of Special Agent in Charge Leslie Wiser, Jr. in Newark, The IRS Criminal Investigation Division, under the direction of Special Agent in Charge Patricia J. Haynes, and the New Jersey State Police, under the direction of Captain Joseph Rick Fuentes, for investigation of the case.

The Government is represented by Assistant U.S. Attorney William E. Fitzpatrick of the Criminal Division in Camden.

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Defense Attorney:

Alexander - Lisa Evans, Esq. AFPD

Bethune - Lisa Evans, Esq. AFPD (For the purpose of the initial appearance only)

Lavoe - Lisa Evans, Esq. AFPD (For the purpose of the initial appearance only)