Brazilian National Sentenced To 4 Years In Prison For $15 Million Advance Fee Scheme; Additional Charges Unsealed Against 4 Co-Conspirators

 

The Defendants Defrauded Brazilian-Based Businesses of Millions of Dollars Through an Advance Fee Scheme Purporting to Offer Large International Loans

 Audrey Strauss, United States Attorney for the Southern District of New York, and Philip R. Bartlett, Inspector in Charge of the New York Office of the U.S. Postal Inspection Service (“USPIS”), announced that JOAO DJALMA PRESTES JUNIOR, a/k/a “Joao Pereira,” a Brazilian national, was sentenced today to 48 months in prison after pleading guilty to defrauding Brazilian businesses of approximately $15 million through an international advance fee scheme.  PRESTES JUNIOR was arrested in June 2020 and pled guilty in April 2021 before U.S. District Judge Jed S. Rakoff, who imposed today’s sentence.

In addition, Superseding Indictments were unsealed today charging co-conspirators HERMINIO RIBEIRO DIAS CRUZ, JUAN CARLOS VILLALBA, ROSE MARTINS DE OLIVEIRA, and ALEX PEREIRA DE SOUTO with wire fraud and conspiracy to commit wire fraud in connection with the same international advance fee scheme.  CRUZ, VILLALBA, DE OLIVEIRA, and DE SOUTO remain at large.

Manhattan U.S. Attorney Audrey Strauss said: “Partly through face-to-face meetings with victims in a Manhattan skyscraper, Joao Djalma Prestes Junior stole millions of dollars from companies seeking loans.  Prestes Junior will now spend four years in U.S. prison for those crimes.  As alleged, Prestes Junior did not work alone.  His four fugitive alleged co-conspirators in this multimillion-dollar international advance fee scheme have now been charged.”

USPIS Inspector-in-Charge Philip R. Bartlett said: “Postal Inspectors usually see advance fee scams tied to lottery fraud.  However, in this case the victims were allegedly duped into paying fees in advance to secure business loans.  The defendants allegedly used victim money to fund their opulent lifestyles.  Postal Inspectors remind those seeking loans to exercise due diligence when you have to pay money to get money.”

According to public filings and court proceedings in the case against PRESTES JUNIOR, CRUZ, VILLALBA, DE OLIVEIRA, and DE SOUTO, including the allegations in the Superseding Indictments[1]:

Since at least July 2018 up to and including February 2020, PRESTES JUNIOR participated in a scheme to defraud Brazilian-based businesses of millions of dollars through an advance fee scheme.

As part of the scheme PRESTES JUNIOR and his co-conspirators falsely represented that the victims would receive a large loan after making advance payment of various fees to entities that, unbeknownst to the victims, were controlled by the conspirators.  To effect the scheme, PRESTES JUNIOR and his co-conspirators created several shell companies (and accompanying websites) in the United States: a purported financial entity, a purported escrow company, and a purported insurance entity.  The defendant and his co-conspirators directed victims to pay advance fees to the escrow company and the insurance entity.  After the initial payments were made, the defendant and his co-conspirators falsely represented that there was some obstacle to transferring the loan money to the victim – such as a tax payment – and that the obstacle could be overcome if the victim made yet another advance payment.  Ultimately, despite paying one or more such fees up front, the victims never received the promised loans, and the money paid in advance was never returned. 

PRESTES JUNIOR also had executives of the victim companies travel to New York, New York, for in-person meetings in a suite in a skyscraper in downtown Manhattan that was purportedly the financial entity’s New York office.  When interacting with victim companies, however, PRESTES JUNIOR used an alias, “Joao Pereira,” due to the defendant’s notoriety in Brazil, where the defendant was previously the subject of widely publicized criminal proceedings. 

Money stolen from victims was used in part to fund PRESTES JUNIOR’s lavish lifestyle.  For example, although PRESTES JUNIOR did not even live in the United States full time, he owned a Maserati in this country.

In addition to the prison term, JOAO DJALMA PRESTES JUNIOR, a/k/a “Joao Pereira,” 48, a Brazilian national, was ordered to forfeit $15,266,679.10 and to make restitution in the amount of $15,266,679.10.

HERMINIO RIBEIRO DIAS CRUZ, 76, a Portuguese national, JUAN CARLOS VILLALBA, 56, a Paraguayan national, ROSE MARTINS DE OLIVEIRA, 61, a Brazilian national, and ALEX PEREIRA DE SOUTO, 40, a Brazilian national, are each charged with one count of wire fraud, in violation of 18 U.S.C. § 1343, and one count of conspiracy to commit wire fraud, in violation of 18 U.S.C. § 1349, each of which carries a maximum sentence of 20 years in prison.  The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of these defendants would be determined by a judge.

Ms. Strauss praised the outstanding investigative work of the USPIS.  

[1] As the introductory phrase signifies, the entirety of the text of the Superseding Indictments and the description of the Superseding Indictments set forth in this release constitute only allegations, and every fact described should be treated as an allegation.