Court finds defendant acted with intent to defraud and conceal his membership interest in a multi-million dollar Colorado limited liability company
DENVER -- U.S. District Judge Christine M. Arguello recently found that Michael D. Wilhite, of Westcliffe, Colorado, concealed his membership interest in Advance Floor Concepts, LLC (“AFC"), a successful multi-million dollar structural steel company for the purpose of hindering, delaying and defrauding his creditors, Acting U.S. Attorney Bob Troyer announced.
In January 2001, Wilhite pled guilty to one count of wire fraud and aiding and abetting, stemming from his involvement in the 1990’s in a sophisticated scheme to defraud the Bank of New Zeland of approximately $5.18 million. The court sentenced Wilhite to three months’ imprisonment, three years’ supervised release, and ordered him to pay restitution in the amount of $1,741,700. Wilhite stopped making restitution payments in 2004, when his term of supervised release ended. Wilhite presently owes approximately $1,719,078.98.
After conducting a thorough investigation into Wilhite’s financial condition, the United States filed a writ of execution, seeking to sell Wilhite’s membership interest in AFC. Wilhite denied having any interest in AFC and his wife, Mrs. Darla Wilhite, claimed to be AFC’s only member.
According to court documents, and the evidence introduced at trial, Wilhite and Mrs. Wilhite created AFC solely in her name in 1997 to avoid and defraud his creditors, including the United States. Indeed, the court found that Wilhite avoided putting a single asset in his name for over two decades, and expressly admitted at trial that he decided not to co-own AFC with his wife, at least in part because doing so “could have" jeopardized “[his] family’s assets." The court also found that Wilhite exercised sufficient control over AFC to be deemed an owner. The evidence revealed that Wilhite could hire and fire employees and direct their duties; could adjust AFC’s inventory; authored and implemented memos and policies; “has knowledge of and participates in [AFC’s] financial structure"; and even participated in negotiations to sell the company in 2013.
“Due to the tenacious work of our Asset Recovery Division, victims of Wilhite’s crime will now see justice in the form of additional restitution payments," said Acting U.S. Attorney Bob Troyer. “We have the ‘Seal Team 6’ of Asset Recovery, and these folks work tirelessly on behalf of victims and the taxpayers every day."
This matter was handled by the U.S. Attorney’s Office for the District of Colorado’s Asset Recovery Division.
Source: U.S. Department of Justice, Office of the United States Attorneys
