JACKSONVILLE, Fla. (WANE) – Three people connected to a scheme that cost a Hicksville business millions of dollars have been sentenced in federal court.
Marcelene M. Keesbury, 54, Fort Wayne, and Charles M. French, 50, Fort Wayne, were sentenced Friday to 3 years and 5 months in federal prison. Justin Pennington, 30, St. John’s County, Florida, was sentenced to 5 years and 5 months in federal prison. Pennington was tagged as the mastermind behind the scheme that bilked more than $4 million from The Wholesale House in Hicksville.
All three were ordered to pay $4,075,000 in restitution by U.S. District Judge Brian Davis.
Keesbury and French pleaded guilty in November 2016 in U.S. District Court in Jacksonville, Florida, to being responsible for The Wholesale House losing approximately $4.8 million in revenue over the course of nearly four years. Pennington was found guilty of conspiracy and nine counts of wire fraud by a federal jury April.
Federal investigators determined all three were employed by The Wholesale House in an executive capacity. They secretly opened an internet business called 3 Kings in direct competition to The Wholesale House. Keesbury and French would make purchases from The Wholesale House at a significant discount and then sell them in direct competition on the 3 Kings website, with Pennington serving as the fraudulent company’s information technology director.
According to federal documents, due to the fact 3 Kings was able to purchase merchandise cheaper than their competitors, the long-time customer base for The Wholesale House began losing significant sales to 3 Kings. The company purchased nearly $40 million in products and Pennington built credit card balances up to $100,000 a month, according to the U.S. Attorney’s Office.
The scheme began to unravel in 2013 when one of the owners of The Wholesale House questioned French about 3 Kings and the company’s ability to pay its debt to The Wholesale House. During a meeting in Florida, French, Pennington and Keesbury made incriminating statements to the owners and an FBI special agent about their involvement, saying their motive was greed.
“The subjects in this case developed a sophisticated scheme to deceive a local business owner using a competing business,” said Charles P. Spencer, Special Agent in Charge of the FBI Jacksonville Division. “Incidents of fraud, like this, are not victimless crimes. The FBI is dedicated to working closely with government and private entities to track down and stop scams in an effort to protect the business community.”
The FBI and United State Attorney Mark Devereaux handled the case.