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OIG: Office of Inspector General
   Current Section

Investigation Report

United States Attorney David Capp
Northern District of Indiana

204 South Main Street, Room M01
South Bend, IN 46601

FOR IMMEDIATE RELEASE:
April 15, 2010

Contact: Mary L. Hatton
Phone: (219) 937-5603
Fax: (219) 852-2770

INTERNATIONAL BUSINESSMAN CHARGED IN 23 COUNT INDICTMENT

The United States Attorney’s Office announced that a Grand Jury sitting in South Bend, Indiana, returned a 23-count indictment against James A. Simon. Simon, 59, of Huntertown, Indiana, is charged with tax fraud, failure to report foreign accounts, mail fraud, and federal financial aid fraud.

The indictment (Counts 1-4) alleges that, from 2003 through 2006, Simon and/or his family received approximately $1,799,502.60 from five business entities with which he was affiliated. These business entities were located in Gibraltar, Cyprus, Colorado, and Indiana. Simon and his family spent approximately $1,748,607.21 of this amount between 2003 and 2006. Simon did not report this $1,799,502.60 as income on his federal tax returns from 2003 through 2006. In addition, Simon did not disclose on his federal tax returns from 2003 through 2006 that he had an interest in foreign bank accounts held in Gibraltar, Germany, and Cyprus.

The indictment (Counts 5-8) further alleges that, from 2004 through 2007, Simon had a financial interest in, or signature authority over, bank accounts held in Gibraltar, Germany, and Cyprus. These accounts had an aggregate value of more than $10,000 during these years. The indictment charges that Simon failed to file with the Treasury Department a required report regarding these accounts, called a Report of Foreign Bank and Financial Accounts (an “FBAR”).

The indictment (Counts 9-19) further alleges that, from 2004 through 2007, Simon applied for private financial aid for his family members to attend two different schools. On these applications, which were mailed, Simon provided false information regarding his family’s income and expenses. As a result of these applications, Simon’s family received total need-based financial aid of $106,600. The indictment charges that the mailings associated with these applications and awards constituted mail fraud.

The indictment (Counts 20-23) further alleges that Simon submitted a federal financial aid application for a family member to attend a third school. Based on this application, from August 2005 through May 2006, this family member received $14,365 in aid provided or insured by the federal government. The indictment charges that Simon obtained these funds illegally.

These charges were filed as a result of an investigation by the Internal Revenue Service Criminal Investigations. This case has been assigned to and will be prosecuted by Assistant United States Attorney Jesse M. Barrett.

The specific sentences to be imposed upon conviction will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines. The United States Attorney's Office emphasizes that an indictment is merely an allegation and that all persons charged are presumed innocent until and unless proven guilty in court.

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Last Modified: 05/21/2010