Application for Leave to File Under Seal; Complaint and Affidavit in Support of Arrest Warrant — Jonathan Cannon and Julie Dotton (E.D.N.Y. No. 24-mj-00342)
Summary
This filing pairs a May 1, 2024 application by the U.S. Attorney's Office, EDNY, for leave to file under seal, citing an ongoing criminal investigation, with a complaint and affidavit in support of arrest warrants for Jonathan Cannon and Julie Dotton in Case No. 24-MJ-342, charging wire fraud under 18 U.S.C. § 1343. FBI Special Agent Amanda Gildea alleges that between March 2020 and October 2020 the two defrauded a Canadian company that was an official provider of PPE to two Canadian provinces. According to the affidavit, Dotton's KRP Holdings agreed on April 14, 2020 to sell about 12 million face masks for about $8.2 million, and the funds went from the company to an attorney serving as a purported escrow agent and then to an SBM Holdings account controlled by Cannon, which sent $2.75 million to NEDC. The affidavit says the company never received PPE and has recovered only $250,000.
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TO: Clerk’s Office
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
________________________________________
APPLICATION FOR LEAVE
TO FILE DOCUMENT UNDER SEAL
A) If pursuant to a prior Court Order:
******************************** Docket Number of Case in Which Entered:___________________
Judge/Magistrate Judge:__________________________________
United States
Date Entered:___________________________________________
-v.- 24-MJ- 342
-v.- _____________________
Jonathan Cannon and Julie Dotton Docket Number
********************************
B) If a new application, the statute, regulation, or other legal basis that
SUBMITTED BY: Plaintiff____ Defendant____ DOJ ✔
____ authorizes filing under seal
John O. Enright
Name:__________________________________________
Firm Name:______________________________________
U.S. Attorney's Office, EDNY Ongoing criminal investigation.
__________________________________________________________
Address:_________________________________________
271 Cadman Plaza East __________________________________________________________
________________________________________________
Brooklyn, NY 11201
Phone Number:___________________________________
718-254-6203 ORDERED SEALED AND PLACED IN THE CLERK’S OFFICE,
E-Mail Address:___________________________________
john.enright@usdoj.gov AND MAY NOT BE UNSEALED UNLESS ORDERED BY
THE COURT.
INDICATE UPON THE PUBLIC DOCKET SHEET: YES NO ✔ __
If yes, state description of document to be entered on docket sheet: DATED: Central Islip , NEW YORK
5/1/24
__________________________________________________ _________________________________________________________
__________________________________________________ U.S. MAGISTRATE JUDGE
RECEIVED IN CLERK’S OFFICE___________________________
DATE
MANDATORY CERTIFICATION OF SERVICE:
A.) ___ A copy of this application either has been or will be promptly served upon all parties to this action, B.) ___ Service is excused by 31 U.S.C. 3730(b), or by
the following other statute or regulation:______; or C.) ✔
____This is a criminal document submitted, and flight public safety, or security are significant concerns.
(Check one)
May 1, 2024
__________________ ______________________________
DATE SIGNATURE
HDM/DGR:JOE/AT
F. #2022R00468
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
---------------------------X TO BE FILED UNDER SEAL
UNITED STATES OF AMERICA COMPL AINT AND
AFFIDAVIT IN SUPP ORT
- against - OF AR R E ST WARR ANT
JONATHAN CANNON and (18 U.S.C. §§ 1343, 2 and 3551 et seq.)
JULIE DOTTON,
Case No. 24-MJ-342
Defendants.
---------------------------X
EASTERN DISTRICT OF NEW YORK, SS:
Amanda Gildea, being duly sworn, deposes and states that she is a Special Agent
with the Federal Bureau of Investigation (“FBI”), duly appointed according to law and acting as
such.
In or about and between March 2020 and October 2020, both dates being
approximate and inclusive, within the Eastern District of New York and elsewhere, the
defendants JONATHAN CANNON and JULIE DOTTON, together with others, did knowingly
and intentionally devise a scheme or artifice to defraud a company, whose identity is known to
your deponent, in order to obtain money or property from it by means of one or more materially
false and fraudulent pretenses, representations and promises, and for the purpose of executing
such scheme and artifice, did transmit or cause to be transmitted, by means of wire
communication in interstate and foreign commerce, writings, signs, signals, pictures and sounds.
(Title 18, United States Code, Sections 1343, 2 and 3551 et seq.)
2
The source of your deponent’s information and the grounds for her belief are as
follows:1
1. I am a Special Agent with the FBI and have been involved in the
investigation of numerous cases involving financial crimes, including securities fraud,
commodities fraud, wire fraud, mail fraud and money laundering. I am familiar with the facts
and circumstances set forth below from my participation in the investigation; my review of the
investigative file, including the defendant’s criminal history record; my review of documents
obtained in the course of the investigation, including emails obtained pursuant to judicially
authorized search warrants; and from my review of reports of other law enforcement officers and
regulatory agencies.
Background, Relevant Individuals and Entities
2. The defendant JONATHAN CANNON resides in Miller Place, New
York, in the Eastern District of New York. CANNON purports to work in various capacities in
the real estate industry.
3. The defendant JULIE DOTTON resides in Orchard Park, New York.
DOTTON was the chief executive officer of Applied Sciences Group, Inc., a private company
that publicly claimed to “provide[] technically superior software engineering solutions for
applications involving research, industrial and manufacturing environments, design-oriented
engineering services, technical project management and training.”
4. SBM Holdings LLC (“SBM Holdings”) is a limited liability company
organized under the laws of the state of Wyoming in March 2017 with a principal place of
1
Because the purpose of this Complaint is to set forth only those facts necessary to
establish probable cause to arrest, I have not described all the relevant facts and circumstances of
which I am aware.
3
address in Wyoming. SBM Holdings is a nominal entity owned and controlled by the defendant
JONATHAN CANNON.
5. New England Development Corp. (“NEDC”) is a corporation organized
under the laws of the state of Vermont in November 2006 with a principal place of address in
Miller Place, New York, in the Eastern District of New York. NEDC purports to be a real estate
development business. The defendant JONATHAN CANNON is the president, vice president
and secretary of NEDC.
6. KRP Holdings, LLC (“KRP Holdings”) is a limited liability company
organized under the laws of the state of New York in January 2011 with a principal place of
address in Erie County, New York. KRP Holdings is a nominal entity owned and controlled by
the defendant JULIE DOTTON.
7. Based on my participation in the investigation to date, I have learned that
in or about and between March 2020 and October 2020, the defendants JONATHAN CANNON
and JULIE DOTTON executed a scheme to defraud a Canadian company (“Company-1”), an
entity whose identity is known to me, that was an official provider of personal protective
equipment (“PPE”) to two Canadian provinces during the COVID-19 pandemic.
The Fraudulent Scheme
8. On or about March 31, 2020, the defendant JONATHAN CANNON
forwarded an email from the defendant JULIE DOTTON to Attorney-1, an individual whose
identity is known to me. CANNON informed Attorney-1, in substance, that he was working
with DOTTON, that he had given DOTTON an escrow agreement and that DOTTON “will pay
you direct for your services, she is good for it.” CANNON also stated that he was expecting
“part of the funs [sic] are going to me” for an unspecified “other transaction.”
4
9. In or about early April 2020, a representative of Company-1, an individual
whose identity is known to me, communicated with the defendant JULIE DOTTON, who
represented to the Company-1 representative that she had contacts with Supplier-1, an entity
whose identity is known to me, and could quickly and reliably procure PPE, including face
masks. DOTTON offered to serve as the intermediary between Supplier-1 and Company-1.
10. On or about April 14, 2020, KRP Holdings, a nominal business entity
controlled by the defendant JULIE DOTTON, entered into an agreement with Company-1 to sell
Company-1 approximately 12 million face masks for approximately $8.2 million.
11. On or about April 15, 2020, Company-1 wired $8.2 million to Attorney-1,
who was serving as a purported escrow agent for the defendant JULIE DOTTON and with whom
the defendant JONATHAN CANNON had previously communicated with on March 31, 2020.
12. Bank records reflect that, after Attorney-1 received the funds from
Company-1, rather than use the funds to purchase PPE from Supplier-1 on Company-1’s behalf
as agreed, the defendant JULIE DOTTON, together with the defendant JONATHAN CANNON
and others, caused Attorney-1 to wire the funds to a bank account in the name of SBM Holdings,
an entity owned and controlled by CANNON.
13. On or about April 16, 2020, the defendant JONATHAN CANNON
emailed the defendant JULIE DOTTON, among other things, a “Corporate Resolution”
document for SBM Holdings and wiring instructions for a bank account in the name of SBM
Holdings. The Corporate Resolution claimed that SBM Holdings, whose only director was
CANNON, had held a Board meeting that same day and issued the Corporate Resolution. The
Corporate Resolution purportedly resolved the following:
5
a. SBM Holdings was “to join with KRP Holdings LLC and Julie
Dotton . . . in her Medical Supply business. All funds moved to this account from KRP
Holdings LLC and Julie Dotton will be directed by KRP Holdings LLC and Julie Dotton. Any
and ALL fees payable to SBM Holdings, LLC will be discussed and directed as payment from
Julie Dotton.”
b. The Corporate Resolution further resolved that “Jonathan Cannon
will need to sign authorizing ANY movement of funds from the [bank account in the name of
SBM Holdings] in which the invested funds will be held.”
c. Finally, the Corporate Resolution resolved that “these funds are the
property of KRP Holdings LLC and are being used solely for the purposes to expedite business
in the Medical Supply business that Julie Dotton has. The funds will be directed to be paid at
the Sole discretion of Julie Dotton and KRP Holdings LLC.”
d. The Corporate Resolution was signed by the defendant
JONATHAN CANNON on behalf of SBM Holdings and the defendant JULIE DOTTON on
behalf of KRP Holdings.
14. The Corporate Resolution’s purported resolutions were, as defendant
JONATHAN CANNON knew, false and misleading, as CANNON distributed the monies
received in the SBM Holdings account to third parties for purposes other than in connection with
any medical supply business as demonstrated below.
15. In an email attaching the Corporate Resolution, the defendant
JONATHAN CANNON told the defendant JULIE DOTTON, “as discussed [Attorney-1] will
have to physically go to bank, so you should instruct him soon, maybe he will go on his Lunch
break.”
6
16. On or about April 17, 2020, funds obtained from Company-1 were
received by the bank account in the name of SBM Holdings. CANNON then caused the funds
from the account in the name of SBM Holdings to be further disbursed to bank accounts
controlled by the defendants JULIE DOTTON and JONATHAN CANNON and other third
parties, including confederates of CANNON and DOTTON. Among other wire transfers,
CANNON caused $2.75 million in the account in the name of SBM Holdings to be wired to a
bank account in the name of NEDC controlled by CANNON.
17. Over the course of the next several months, the defendant JONATHAN
CANNON disbursed the $2.75 million in the NEDC Account to various third parties, including
CANNON’s family members.
18. In addition, on or about April 22, 2020, the defendant JULIE DOTTON
emailed the defendant JONATHAN CANNON and asked him to execute a series of personal
wire transfers of almost $700,000 from the account in the name of SBM Holdings to, among
others, certain of DOTTON’s creditors. CANNON caused these wire transfers to be made from
the account in the name of SBM Holdings within two days.
7
19. According to records made publicly available in private litigation between
Company-1, on the one hand, and the defendants JONATHAN CANNON and JULIE DOTTON
and others, on the other hand, Company-1 never received PPE from CANNON, DOTTON or
their respective entities and, in fact, has recovered only $250,000 of the $8.2 million it wired to
Attorney-1 as described above.
WHEREFORE, your deponent respectfully requests that the defendants
JONATHAN CANNON and JULIE DOTTON be dealt with according to law.
Amanda Gildea
Special Agent, Federal Bureau of Investigation
Sworn to before me by telephone on this
1st day of May, 2024
____
____________________________________________
THE HONORABLE STEVEN L. TISCIONE
UNITED STATES MAGISTRATE JUDGE
EASTERN DISTRICT OF NEW YORK
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