08-29-05 -- McKenna, Matthew -- Sentencing -- News Release

Information Systems Manager Sentenced to 41 Months in Prison for Embezzling Nearly $600,000 from Employer

TRENTON - A former manager of information systems for American Credit Alliance, Inc. was sentenced to 41 months in federal prison today on charges of wire fraud and tax evasion for his embezzlement of nearly $600,000 from the then Trenton-based not-for-profit debt consolidation company, U.S. Attorney Christopher J. Christie announced.

U.S. District Judge Stanley R. Chesler also ordered Matthew McKenna, 27, of Levittown, Pa., to pay $592,034.50 in restitution and fines and to serve three years of supervised release upon the completion of his prison sentence.

On January 3, 2005, McKenna pleaded guilty before Judge Chesler to one count each of wire fraud and filing a false tax return.

At his plea hearing, McKenna admitted that from 1999 to 2003, while employed as the head of the company's information systems at its Trenton office, he transferred $592,034 from American Credit Alliance, Inc. (ACA) by directing approximately 176 unauthorized wire transfers from ACA's bank accounts.

McKenna also admitted to filing a false and fraudulent 2002 U.S. Individual Income Tax Return. McKenna admitted his 2002 tax return reported his taxable income for the calendar year 2002 was $3,823, which had a tax due thereon of $383, and that he claimed a refund in the amount of $1,372. McKenna admitted that he failed to report approximately $191,000 in taxable income, which he had taken from ACA. He also admitted that an additional tax of approximately $58,040 was due to the IRS on the income that he failed to report.

ACA is in the business of personal debt consolidation. Customers of ACA pay a contribution to have ACA negotiate settlements with their creditors and to arrange for credit payments to be made on their behalf. The creditors also pay ACA a fee in exchange for arranging these settlements.

In determining an actual sentence, Judge Chesler consulted 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.

Christie credited Special Agents of the IRS Mays Landing Office, under the direction of Special Agent-in-Charge Patricia J. Haynes; the Secret Service's Trenton Office, under the direction of Resident Agent-in-Charge Anthony F. Colgary, III; and the Trenton Police Department, under the direction of Police Director Joseph Santiago, with developing the case which resulted in today's guilty plea.

The Government is represented by Assistant U.S. Attorneys Joan Thomas of the U.S. Attorney's Criminal Division in Trenton and Milagros Camacho-Gutierrez of the U.S. Attorney's Criminal Division in Newark.

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Defense Attorney: Scott Krasny, Esq. West Trenton