William J. Edwards, United States Attorney for the Northern District of Ohio, announced today Fred A. Boukzam and Pon Management, Inc. were sentenced by U.S. District Judge Solomon Oliver, Jr. in Cleveland, Ohio. Boukzam was sentenced to 33 months in prison followed by four years of supervised release. Pon Management, Inc. was placed on probation for four years. Both Boukzam and Pon Management were ordered to make restitution of approximately $4,125,000 to First Merit Bank. Boukzam, age 50, resides in Brooklyn, Ohio, and Pon Management, Inc. is located in Strongsville, Ohio.

On April 29, 2008, a federal Grand Jury in Cleveland, Ohio, returned an indictment against Boukzam and Pon Management charging them with one count of bank fraud. The indictment alleged that Boukzam was president of Pon Management which owned and operated 15 Ponderosa Restaurants in Northern Ohio. The indictment further alleged that, from January 2006 through September 2007, the defendants engaged in substantial check-kiting activity which defrauded First Merit Bank and caused that financial institution to sustain a loss of $4,127,000. Specifically, the indictment alleged that, during that time period, the defendants utilized various company bank accounts to conduct their fraudulent scheme which involved more than 44,000 checks totaling approximately $824 million.

Boukzam and Pon Management pled guilty to this charge on June 18, 2008.

This case was prosecuted by Assistant United States Attorneys John D. Sammon and Bridget M. Brennan, following an investigation by the Cleveland Office of the Federal Bureau of Investigation.