MATTHEWS

Palm Beach Daily News - - TODAY -

the case. The charge car­ries a max­i­mum prison term of five years. The U.S. At­tor­ney’s of­fice in New Haven filed the in­dict­ment Fri­day.

Mia Matthews and her hus­band are sched­uled to be ar­raigned Tues­day by U.S. Mag­is­trate Judge Robert M. Spec­tor in New Haven. Mia Matthews was not ar­rested but is ex­pected to “self sur­ren­der” that day, said spokesman Tom Car­son of the U.S. At­tor­ney’s of­fice in Con­necti­cut.

The cou­ple “main­tained res­i­dences in both Florida and Con­necti­cut,” ac­cord­ing to a state­ment re­leased Fri­day by the of­fice of John H. Durham, U.S. at­tor­ney for the District of Con­necti­cut.

At­tor­ney David A. Ring, who is rep­re­sent­ing Robert Matthews, said he couldn’t com­ment on the case.

Mia Matthews is a singer and ac­tress who won a re­gional Car­bonell Award as best ac­tress in a play for her 2016 per­for­mance in After at Zoetic Stage in Mi­ami.

The tax-eva­sion charge against the Matthewses is part of a 21-count “su­per­sed­ing in­dict­ment” re­turned by the grand jury. The orig­i­nal grand jury in­dict­ment was re­turned in March and led to the ar­rest of Robert Matthews and Palm Beach real es­tate at­tor­ney Les­lie R. Evans, 71, at their Palm Beach homes on fraud and money-laun­der­ing charges re­lated to the Palm House.

Robert Matthews and Evans pleaded not guilty to all the charges in the orig­i­nal in­dict­ment. Both men are free on bond.

Money trans­fers

In ad­di­tion to the tax-eva­sion count, Robert Matthews is charged with eight counts of wire fraud, one count of bank fraud, one count of con­spir­acy to com­mit bank fraud and wire fraud, and 10 counts of il­le­gal mone­tary trans­ac­tions. He faces up to 325 years in prison if con­victed on all counts, ac­cord­ing to the U.S. At­tor­ney’s of­fice.

Evans has been charged with eight counts of wire fraud, one count of bank fraud, one count of con­spir­acy to com­mit bank fraud and wire fraud, and one count of il­le­gal mone­tary trans­ac­tions. Con­vic­tions on all those counts would carry a max­i­mum penalty of up to 230 years, the U.S. At­tor­ney’s of­fice said.

The new tax-eva­sion charge against the Matthewses in­volves, in part, money trans­fers into an “in­ter­est on trust ac­count” (IOTA) ad­min­is­tered by Evans, ac­cord­ing to the su­per­sed­ing in­dict­ment.

Ac­cord­ing to Fri­day’s state­ment, the su­per­sed­ing in­dict­ment al­leges that be­tween about 2009 and March 2017, Robert and Maria Matthews “will­fully at­tempted to evade pay­ing fed­eral in­come tax they owed for the 2005 and 2007 cal­en­dar years in mul­ti­ple ways, in­clud­ing by us­ing lim­ited li­a­bil­ity com­pa­nies, a com­pany bank ac­count, and the Evans IOTA ac­count to pay for per­sonal ex­penses. In ad­di­tion, after Robert and Maria Matthews re­ceived no­tice from the IRS that a fail­ure to pay their delin­quent in­come tax li­a­bil­i­ties by Septem­ber 2, 2016, would re­sult in the seizure of all of their as­sets, Robert Matthews sold, on Septem­ber 2, 2016, a Mercedes for $82,000 and, after pay­ing off a lien, caused the pro­ceeds of the sale to be wired into the Evans IOTA ac­count.”

The Palm House ren­o­va­tion pro­ject at 160 Royal Palm Way has been en­tan­gled for years in le­gal bat­tles, in­clud­ing law­suits, fore­clo­sure pro­ceed­ings, code vi­o­la­tions and re­cent Chap­ter 11 bank­ruptcy fil­ing. Con­struc­tion ceased at the site in Oc­to­ber 2014, and the pro­ject is now over­seen by a court-ap­pointed re­ceiver.

For­eign in­vest­ment

For­eign in­vestors put money into the Palm House pro­ject through the fed­eral EB-5 pro­gram, which of­fers for­eign na­tion­als and their fam­i­lies ex­pe­dited per­ma­nent im­mi­gra­tion visas — com­monly known as green cards — into the United States in ex­change for in­vest­ing in U.S. con­struc­tion projects un­der spe­cific rules, the in­dict­ment said.

The money was trans­ferred be­tween ac­counts in Florida and Con­necti­cut, ac­cord­ing to the in­dict­ment.

The in­dict­ment “al­leges that Robert Matthews, Evans and oth­ers used EB-5 fund­ing for pur­poses not re­lated to the (Palm House) pro­ject, in­clud­ing for Robert and Maria Matthews’ per­sonal gain,” ac­cord­ing to Fri­day’s state­ment.

Last month, U.S. Se­cu­ri­ties and Ex­change Com­mis­sion ini­ti­ated a sep­a­rate eight-count civil com­plaint ac­cus­ing Robert Matthews, Royal Palm Beach res­i­dent Joseph J. Walsh Sr. and two of Walsh’s com­pa­nies of se­cu­ri­ties fraud by mis­us­ing mil­lions of dol­lars so­licited from EB-5 for the Palm House. That ac­tion was filed in U.S. District Court for the South­ern District of Florida, de­mands resti­tu­tion and money penal­ties, and men­tions the pos­si­bil­ity of a jury trial.

Walsh and his com­pa­nies have not been charged in the Con­necti­cut case. Court fil­ings show EB-5 in­vestors lived in China, Iran and Turkey.

Two other men in cases re­lated to the Con­necti­cut charges have been sched­uled for sen­tenc­ing hear­ings in June 2019. Gerry Matthews, who is Robert Matthews’ brother, and Boynton Beach con­struc­tion ex­ec­u­tive Nick Lau­dano in March en­tered plea agree­ments in their cases. Gerry Matthews, a com­mer­cial real es­tate bro­ker in Con­necti­cut, pleaded guilty to one felony count of con­spir­ing to com­mit wire fraud and could face a 20-year prison sen­tence. Lau­dano faces a max­i­mum sen­tence of 40 years after plead­ing guilty to two felony counts — con­spir­acy to com­mit bank fraud and tak­ing part in an il­le­gal mone­tary trans­ac­tion.

“As part of this al­leged scheme, Robert Matthews, Evans and oth­ers moved in­vestor funds through var­i­ous bank ac­counts lo­cated in Con­necti­cut and Florida,” Fri­day’s state­ment said.

“The funds were used to pay Robert and Maria Matthews’ credit card debts, to pur­chase two prop­er­ties lo­cated in Washington De­pot (in) Con­necti­cut and to as­sist in Robert Matthews’ pur­chase of a 151-foot yacht. One of the Washington De­pot prop­er­ties was a prop­erty that Robert Matthews had pre­vi­ously lost in fore­clo­sure. Robert Matthews, Evans, Ni­cholas Lau­dano and oth­ers con­spired to pur­chase the prop­erty out of fore­clo­sure by con­ceal­ing both the re­la­tion­ship be­tween the co-con­spir­a­tors, and the source of the funds used to pur­chase the prop­erty.”

The Con­necti­cut al­le­ga­tions were in­ves­ti­gated by the FBI and the IRS’s Crim­i­nal In­ves­ti­ga­tion Di­vi­sion, the state­ment said.

Jury se­lec­tion inn Matthews and Evans’ sin­gled fraud trial was orig­i­nally sched­uled for early June but a judge de­layed that date un­til at least Sept. 4. At­tor­neys for both sides said they needed more time to re­view the gov­ern­ment’s ev­i­dence and to pre­pare for trial.

In early Au­gust, the Palm House’s court-ap­pointed re­ceiver filed for vol­un­tary Chap­ter 11 bank­ruptcy on be­half of its own­er­ship com­pany, 160 Royal Palm LLC, which owes nearly $115 mil­lion to cred­i­tors, court fil­ings show.

Meghan McCarthy / Daily News File Photo

The Palm House ren­o­va­tion pro­ject has been en­tan­gled for years in le­gal bat­tles.

Richard Graulich / Daily News file photo

Robert Matthews, who is fac­ing 21 felony charges, ar­rives with his wife Mia for a hear­ing at the fed­eral court­house in West Palm Beach in March.

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