Plea Agreement — United States v. Leslie Danielle Bethea, No. 2:18-cr-00025 (Eastern District of Tennessee)

Summary

A Plea Agreement, Document 22, filed November 1, 2018 in United States of America v. Leslie Danielle Bethea, Case 2:18-cr-00025-JRG-CRW (Judge Reeves), in the United States District Court Eastern District of Tennessee at Greeneville. Under it the defendant will plead guilty to Count One (Conspiracy to commit Wire fraud, 18 U.S.C. § 1349) and Count Six (Wire Fraud, 18 U.S.C. § 1343), each with a stated maximum of twenty years in prison and a fine of $250,000, and the United States agrees to move at sentencing to dismiss the remaining counts. The agreement sets out the elements of each offense and facts the defendant agrees and stipulates to in support of the plea. It states that its terms can be modified only in writing.

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UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF TENNESSEE

AT GREENEVILLE
UNITED STATES OF AMERICA )
) No. 2:18-cr-25
V. )
) JUDGE REEVES
LESLIE DANIELLE BETHEA )
PLEA AGREEMENT

The United States of America, by the United States Attorney for the Eastern District of
Tennessee, and the defendant, Leslie Danielle Bethea, and the defendant’s attorney, Nikki Pierce

have agreed upon the following:

1, The defendant will plead guilty to the following counts in the indictment:
a) Count One. Conspiracy to commit Wire fraud in violation of 18 U.S.C. §
1349.

The punishment for this offense is as follows. A maximum of twenty years in prison, a
fine of $250,000, three years on supervised release, $100 special assessment, restitution as
ordered by the court, and forfeiture of the fruits and instrumentalities of the offense.

b) Count Six. Wire Fraud in violation of 18 U.S.C. § 1343.

The punishment for this offense is as follows. A maximum of twenty years in prison, a
fine of $250,000, three years on supervised release, $100 special assessment, restitution as
ordered by the court, and forfeiture of the fruits and instrumentalities of the offense.

2. In consideration of the defendant’s guilty pleas, the United States agrees to move
the Court at the time of sentencing to dismiss the remaining counts against the defendant in this

indictment.

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3, The defendant has read the indictment, discussed the charges and possible
defenses with defense counsel, and understands the crimes charged. Specifically, the elements of
the offenses are as follows.

a. As to Count One (Conspiracy to commit wire fraud), the elements of the
offense are as follows: 1) Two or more persons, in some way or manner, agreed to try to
accomplish a common and unlawful plan to commit wire fraud, as charged in the indictment; 2)
The defendant knew of the unlawful purpose of the plan and willfully joined in it.

b. As to Count Six (wire fraud), the elements of the offense are as follows: 1)
the defendant devised a scheme to defraud or to obtain money or property by materially false or
fraudulent pretenses, representations or promises or willfully participated in such a scheme with
knowledge of its fraudulent nature; 2) the defendant acted with intent to defraud; and 3) in
advancing, furthering, or carrying out the scheme to defraud, the defendant transmitted any
writing, signal, or sound by means of a wire, radio, or television communication in interstate
commerce or caused such transmissions to occur.

4. In support of the defendant’s guilty plea, the defendant agrees and stipulates to the
following facts, which satisfy the offense elements. These are the facts submitted for purposes
of the defendant’s guilty plea. They do not necessarily constitute all of the facts in the case.
Other facts may be relevant to sentencing. Both the defendant and the United States retain the
right to present additional facts to the Court to ensure a fair and appropriate sentence in this case.

a. From on or about January 1, 2016, and continuing through January 31, 2018,
the defendant received and used internet service provided by Charter Communications and
Verizon Wireless. Charter Communications is an American telecommunications company

headquartered in Stamford, Connecticut, which provides, among other services, internet service

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to consumer and commercial customers. Verizon Wireless is an American telecommunications
company headquartered in Basking Ridge, New Jersey, which provides, among other services,
internet service to consumer and commercial customers.

b. From on or about January 1, 2016, and continuing through January 31, 2018,
the defendant received and used mobile telephone service provided by T-Mobile, a wireless
network operator headquartered in Bellevue, Washington and by AT&T Corporation (and its
subsidiaries), a wireless network operator headquartered in Bedminster, New Jersey.

c. The internet and wireless mobile telephone service are means of interstate
commerce and communications.

d. American Airlines is an American corporation headquartered in Dallas, Texas
which provides commercial air travel services. JP Morgan Chase Bank, N.A. doing business as
Chase Bank is a national, federally-chartered bank which constitutes the consumer and
commercial banking subsidiary of the American multinational banking and financial services
holding company, JP Morgan Chase & Co, headquartered in Chicago, Illinois.

e. The Internal Revenue Service is an agency of the United States Department of
the Treasury responsible for enforcing and administering the tax laws of the United States, and
collecting taxes owed to the United States.

Count One

f. The defendant and unindicted coconspirators obtained blank plastic credit,
debit, and stored value cards with imbedded magnetic stripes. The cards were counterfeit, and
fraudulently represented they were issued by legitimate banks, credit card processors, merchants,
and financial institutions. The defendant obtained the cards via online internet purchases, which

are means of interstate commerce.

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g. The defendant and unindicted coconspirators obtained personal identifying
information, including names and credit card information for individuals. The defendant and
unindicted coconspirators obtained this information by fraudulent and illegitimate means,
including purchasing them on the internet. In effect, the defendant and unindicted coconspirators
stole those individuals’ identities.

h. The unindicted coconspirators used plastic card embossing machines to
emboss the front of the cards with the name of individuals whose identities had been stolen. On
the reverse of the plastic cards, the defendant and unindicted coconspirators re-encoded the
information imbedded on the magnetic stripes to insert legitimate credit card numbers issued to
other individuals. This allowed the defendant and unindicted coconspirators to manufacture
credit cards with mismatched cardholders and account numbers which were not immediately
rejected by merchants.

i. The defendant and other unindicted coconspirators then used the
manufactured plastic cards to purchase goods and services and obtain money from American
Airlines and JP Morgan Chase Bank, and others.

j. From on or about January 1, 2017, through on or about May 10, 2017, the

defendant used counterfeit credit cards she or coconspirators manufactured, to obtain $47,908.56
in travel services provided by American Airlines. These travel services involved over 100
different flight transactions procured for dozens of travelers, including the defendant. The flights
were arranged in person at American Airlines at various airports and included extensive

interstate travel to and from numerous cities in the United States.

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k. As aresult of the defendant’s use of counterfeit cards to procure travel services
described in the preceding paragraph, American Airlines sustained an actual economic loss of
$47,908.56.

1. The manufacture of each counterfeit card and the use of each counterfeit card
for each of the foregoing transactions was an affirmative act of fraud committed by the defendant
and unindicted coconspirators on American Airlines,

m. Each manufactured counterfeit card and each transaction was materially false.

n. Each of the foregoing transactions was an overt act in furtherance of the
scheme and a transmission of any writing, signal, or sound by means of a wire, radio, or
television communication in interstate commerce.

o. From on or about February 1, 2017 through on or about May 10, 2017, the
defendant or unindicted coconspirators unlawfully obtained personal identifiers and account
numbers owned by numerous legitimate customers of JP Morgan Chase Bank who lived in
California, Connecticut, Delaware, Florida, Idaho, Kentucky, Massachusetts, Minnesota, North
Carolina, Ohio, Tennessee, Virginia, and Wisconsin.

p. The defendant or unindicted coconspirators caused to be manufactured
counterfeit credit cards using the identities and account numbers of the foregoing legitimate
customers of Chase Bank and then used those cards for personal use and benefit to engage in
dozens of transactions and obtained goods and services valued at $7,891.82. All of the foregoing
transactions involved the transmission of a writing, signal, or sound by means of a wire, radio, or
television communication in interstate commerce. Merchants who provided goods and services
included hotels (Doubletree Hotels, Holiday Inn Express Hotels, Hilton Hotels), restaurants

(Burger King, Chop House, Wendy’s, Fazoli’s, Pal’s, Bojangles, Chick Fil-A, McDonald’s,

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Wingstop, Sonic Drive-In, Krystal’s, Krispy Kreme Doughnuts, Taco Bell, Chili’s, Buffalo
Wild Wings, Golden Corral, Moto Japanese Restaurant, and Popeye’s), wireless communications
providers (T-Mobile Communications, Verizon Wireless), department and retail stores (Belk’s,
Rack Room Shoes, Grand Home Furnishings, Kirkland’s, Ashley Home Stores), travel services
(American Airlines, Southwest Airlines, United Airlines), miscellaneous personal services
(Touche Nails and Spa, GeekSquad), and fuel (Marathon Oil).

q. Asaresult of the defendant’s foregoing use of counterfeit cards using JP
Morgan Chase Bank customer identifiers and account numbers, JP Morgan Chase Bank
sustained an actual economic loss of $7,891.82. Hilton Albany sustained an actual economic loss
of $3,907.72. Grand Home Furnishing sustained an actual economic loss of $2,942.16. Ashley
Homestore sustained an actual economic loss of $1,533.00.

tr. The manufacture of each counterfeit card and the use of each counterfeit card
for each of the foregoing transactions was an affirmative act of fraud committed by the defendant
on JP Morgan Chase Bank.

s. Each manufactured counterfeit JP Morgan Chase Bank card and each

transaction conducted using counterfeit JP Morgan Chase Bank cards was materially false.

t. Each of the foregoing transactions was an overt act in furtherance of the
scheme and a transmission of any writing, signal, or sound by means of a wire, radio, or
television communication in interstate commerce.

u. While conducting all of the materially false or fraudulent transactions, the
defendant and unindicted coconspirators acted with intent to defraud American Airlines, JP

Morgan Chase, and other vendors and credit card processors.

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v. Under the tax laws of the United States, federal income taxes are withheld
from individual earners’ income and deposited with the Internal Revenue Service. Individual
taxpayers whose earnings exceed a threshold amount are required to file annual returns of
income with the Internal Revenue Service and pay federal income tax on those earnings. Others
who do not earn the threshold amount which requires the filing of an income tax return may
qualify for certain credits which will generate the refund of federal tax dollars. Earners may
receive a refund of federal income taxes which are overpaid by filing an annual return of income.

w. Individuals may submit a written or electronic annual tax return to the Internal
Revenue Service. The federal income tax returns require that the individual provide Personal
Identification Information, including name, Social Security Account Number, address, and
Employer information. Individuals may request that refunds are paid by paper check issued by
the Department of the Treasury or by electronic transfer made to the earner's designated financial
institution account.

x. Individuals submit annual income tax returns under penalties of perjury,
affirming that the information provided in the return is accurate and truthful.

y. As part of the scheme, the defendant submitted, or caused to be submitted
false, fictitious, and fraudulent federal income tax returns to the Internal Revenue Service by
electronic means in interstate commerce, from the time period beginning on January 19, 2016
and ending on February 8, 2017. These tax returns were formal claims for refunds of overpaid
income taxes or claims for tax credits. The defendant knowingly submitted these false, fictitious,
and fraudulent income tax returns, using the personal identifiers of individuals and claimed
$35,700 in false income tax refunds. The federal income tax returns were materially false in

several respects:

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1) The returns used Personal Identification Information which belonged to
individuals who did not authorize or file the tax return (i.e., stolen identities).

2) The returns overstated the filer's earnings and withheld federal income
taxes.

3) The returns overstated the filer's legitimate deductions and credits from
income tax.

z. As part of the scheme, the defendant, by filing federal income tax returns with
the Internal Revenue Service, caused the Internal Revenue Service to issue $35,700 in refunds of
income tax by electronic means which were sent in interstate commerce to the defendant’s
custody and control at different bank accounts or were applied as an offset to the individual’s
outstanding obligations for student loans, child support, etc. Total restitution due to the IRS by
the defendant is $21,151.

aa. As part of the scheme, the defendant diverted funds received from the Internal
Revenue Service to her personal use and control.

ab. As part of the scheme, the defendant established multiple bank accounts at
different financial institutions and manipulated funds among the bank accounts in order to
further the scheme and to conceal and disguise the nature, location, source, ownership, and
control of the money obtained through her fraudulent activities.

ac. While conducting all of the materially false or fraudulent transactions with the
Internal Revenue Service, the defendant acted with intent to defraud the Internal Revenue

Service of the United States Department of the Treasury.

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Count Six

ad. On January 17, 2017, the defendant transmitted electronically from the

Eastern District of Tennessee a false tax return to the IRS using the actual identity of an

individual whose initials are J.S., using that person’s actual Social Security number. Defendant

admits she knows the claim was false when she submitted the claim and knew the claimed refund

was not due or owed. Defendant admits she knowingly defrauded the United States by

submitting false claims to the United States.

5. The defendant is pleading guilty because the defendant is in fact guilty.

The defendant understands that, by pleading guilty, the defendant is giving up several rights,

including:

g)

the right to plead not guilty;

the right to a speedy and public trial by jury;

the right to assistance of counsel at trial;

the right to be presumed innocent and to have the burden of proof placed
on the United States to prove the defendant guilty beyond a reasonable

doubt;

the right to confront and cross-examine witnesses against the defendant;
the right to testify on one’s own behalf, to present evidence in opposition
to the charges, and to compel the attendance of witnesses; and

the right not to testify and to have that choice not used against the

defendant.

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6. The parties agree that the appropriate disposition of this case would be the following
as to each count:
a) The Court may impose any lawful term of imprisonment, any lawful fine,

and any lawful term of supervised release up to the statutory maximum;

b) The Court will impose special assessment fees as required by law; and
c) The Court may order forfeiture as applicable and restitution as
appropriate.

No promises have been made by any representative of the United States to the defendant as to
what the sentence will be in this case. Any estimates or predictions made to the defendant by
defense counsel or any other person regarding any potential sentence in this case are not binding
on the Court, and may not be used as a basis to rescind this plea agreement or withdraw the
defendant’s guilty pleas. The defendant understands that the sentence in this case will be
determined by the Court after it receives the presentence investigation report from the United
States Probation Office and any information presented by the parties. The defendant
acknowledges that the sentencing determination will be based upon the entire scope of the
defendant’s criminal conduct, the defendant’s criminal history, and pursuant to other factors and
guidelines as set forth in the Sentencing Guidelines and the factors set forth in 18 U.S.C. § 3553.
7, Pursuant to Fed. R. Crim. P. 11c1C, the parties agree to the following terms for

purposes of calculating the defendant's Advisory Guideline Range under the United States
Sentencing Guidelines:

a. The base offense level under U.S.S.G. § 2B1.1(a) is 7;

b. The loss amount for purposes of U.S.S.G. § 2B1.1(b)(1) is more than $95,000

and less than $150,000, which yields an increase of 8 offense levels;

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c. The offense involved the use of a sophisticated means for purposes of U.S.S.G.
§ 2B1.1(b)(10), which yields an increase of 2 offense levels;

d. The offense involved the use and possession of five or more means of
identification that were unlawfully produced from, or obtained by the use of, another means of
identification, the possession or use of any device-making equipment, and the production of
counterfeit access devices, for purposes of U.S.S.G. § 2B1.1(b)(11), which yields an increase of
2 offense levels; and

e. The defendant will not be assessed the following sentencing enhancements:

1) Any enhancement under U.S.S.G. § 2B1.1(b)(2) for the number of
victims;
2) The vulnerable victim enhancement under U.S.S.G. § 3A1.1(b); and
3) The obstruction of justice enhancement under U.S.S.G. § 3C1.1.
8. If the Court orders the defendant to pay restitution to the IRS, either directly as part of
the sentence or as a condition of supervised release, the IRS will use the restitution order as the
basis for a civil assessment. See 26 U.S.C. § 6201(a)(4). The defendant does not have the right

to challenge the amount of this assessment. See 26 U.S.C. § 6201(a)(4)(C). Neither the

existence of a restitution payment schedule nor the defendant’s timely payment of restitution
according to that schedule will preclude the IRS from administrative collection of the restitution-
based assessment, including levy and distraint under 26 U.S.C. § 6331.

9. Given the defendant’s agreement to plead guilty, the United States will not
oppose a two-level reduction for acceptance of responsibility under the provisions of
Section 3E1.1(a) of the Sentencing Guidelines. Further, if the defendant’s offense level is 16 or

greater, and the defendant is awarded the two-level reduction pursuant to Section 3E1.1(a), the

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United States agrees to move, at or before the time of sentencing, the Court to decrease the
offense level by one additional level pursuant to Section 3E1.1(b) of the Sentencing Guidelines.
Should the defendant engage in any conduct or make any statements that are inconsistent with
accepting responsibility for the defendant’s offenses, including violations of conditions of release
or the commission of any additional offenses prior to sentencing, the United States will be free to
decline to make such motion, to withdraw that motion if already made, and to recommend to the
Court that the defendant not receive any reduction for acceptance of responsibility under

Section 3E1.1 of the Sentencing Guidelines.

10. | The defendant agrees to pay the special assessment in this case prior to
sentencing.

11. Unless otherwise limited by an agreed preliminary order of forfeiture, the
defendant agrees to forfeit to the United States immediately and voluntarily any and all assets
and property, or portions thereof, which are in the possession or control of the defendant or the
defendant’s nominees that were used and intended to be used in any manner or part to commit
and to facilitate the commission of violations of 18 U.S.C. § 1349 and 1343, and/or any and all
assets and property, or portions thereof, subject to forfeiture as proceeds of the defendant’s
criminal activities which are in the possession or control of the defendant or the defendant’s
nominees. The defendant further agrees to assist the United States fully in the identification,
recovery, and return to the United States of any other assets or portions thereof subject to
forfeiture. The defendant further agrees to make a full and complete disclosure of all assets over
which the defendant exercises control and those which are held or controlled by a nominee. The
defendant agrees to forfeit all interests in the properties as described above and to take whatever

steps are necessary to pass clear title to the United States. These steps include, but are not

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PagelD #: 76
limited to, the surrender of title, the signing of a consent decree of forfeiture, and the signing of
any other documents necessary to effectuate such transfers. The defendant agrees not to object
to any civil or criminal forfeiture brought against these properties. The defendant agrees to take
all such steps to locate such property and to pass title to the United States before the defendant’s
sentencing.

12, The defendant agrees that the Court shall order restitution, pursuant to any
applicable provision of law, for any loss caused to: (1) the victims of any offense charged in this
case (including dismissed counts); and (2) the victims of any criminal activity that was part of
the same course of conduct or common scheme or plan as the defendant’s charged offenses.

13. Financial Obligations. The defendant agrees to pay all fines and restitution
imposed by the Court to the Clerk of Court. The defendant also agrees that the full fine and/or
restitution amounts shall be considered due and payable immediately. If the defendant cannot
pay the full amount immediately and is placed in custody or under the supervision of the
Probation Office at any time, the defendant agrees that the Bureau of Prisons and the Probation
Office will have the authority to establish payment schedules to ensure payment of the fine

and/or restitution. The defendant further agrees to cooperate fully in efforts to collect any

financial obligation imposed by the Court by set-off of federal payments, execution on non-
exempt property, and any other means the United States deems appropriate. The defendant and
counsel also agree that the defendant may be contacted post-judgment regarding the collection of
any financial obligation imposed by the Court without notifying the defendant’s counsel and
outside the presence of the defendant’s counsel. In order to facilitate the collection of financial
obligations to be imposed with this prosecution, the defendant agrees to disclose fully all assets

in which the defendant has any interest or over which the defendant exercises control, directly or

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indirectly, including those held by a spouse, nominee, or other third party. In furtherance of this
agreement, the defendant additionally agrees to the following specific terms and conditions:

a) If so requested by the United States, the defendant will promptly submit a
completed financial statement to the U.S. Attorney’s Office, in a form it provides and as it
directs. The defendant promises that such financial statement and disclosures will be complete,
accurate, and truthful.

b) The defendant expressly authorizes the U.S. Attorney’s Office to obtain a
credit report on the defendant in order to evaluate the defendant’s ability to satisfy any financial
obligation imposed by the Court.

c) If so requested by the United States, the defendant will promptly execute
authorizations on forms provided by the U.S. Attorney’s Office to permit the U.S. Attorney’s
Office to obtain financial and tax records of the defendant.

14. The defendant acknowledges that the principal benefits to the United States of a
plea agreement include the conservation of limited government resources and bringing a certain
end to the case. Accordingly, in consideration of the concessions made by the United States in

this agreement and as a further demonstration of the defendant’s acceptance of responsibility for

the offenses committed, the defendant voluntarily, knowingly, and intentionally agrees to the
following:

a) The defendant will not file a direct appeal of the defendant’s convictions
or sentence with one exception: The defendant retains the right to appeal a sentence imposed
above the sentencing guideline range determined by the Court or above any mandatory minimum

sentence deemed applicable by the Court, whichever is greater. The defendant also waives the

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PagelD #: 78
right to appeal the Court’s determination as to whether the defendant’s sentence will be
consecutive or partially concurrent to any other sentence.

b) The defendant will not file any motions or pleadings pursuant to 28 U.S.C.
§ 2255 or otherwise collaterally attack the defendant’s convictions or sentence, with two
exceptions: The defendant retains the right to file a § 2255 motion as to (i) prosecutorial
misconduct and (ii) ineffective assistance of counsel.

C) The defendant will not, whether directly or by a representative, request or
receive from any department or agency of the United States any records pertaining to the
investigation or prosecution of this case, including, without limitation, any records that may be
sought under the Freedom of Information Act, 5 U.S.C. Section 552, or the Privacy Act of 1974,
5 U.S.C. Section 552a.

15. This plea agreement becomes effective once it is signed by the parties and is not
contingent on the defendant’s entry of a guilty plea. If the United States violates the terms of
this plea agreement, the defendant will have the right to withdraw from this agreement. Ifthe
defendant violates the terms of this plea agreement in any way (including but not limited to

failing to enter guilty pleas as agreed herein, moving to withdraw guilty pleas after entry, or by

violating any court order or any local, state or federal law pending the resolution of this case),
then the United States will have the right to void any or all parts of the agreement and may also
enforce whatever parts of the agreement it chooses. In addition, the United States may prosecute
the defendant for any and all federal crimes that the defendant committed related to this case,
including any charges that were dismissed and any other charges which the United States agreed
not to pursue. The defendant expressly waives any statute of limitations defense and any

constitutional or speedy trial or double jeopardy defense to such a prosecution. The defendant

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also understands that a violation of this plea agreement by the defendant does not entitle the
defendant to withdraw the defendant’s guilty pleas in this case.

16. The United States will file a supplement in this case, as required in every case by
the Local Rules of the United States District Court for the Eastern District of Tennessee, even
though there may or may not be any additional terms. If additional terms are included in the
supplement, they are hereby fully incorporated herein.

17. This plea agreement and supplement constitute the full and complete agreement
and understanding between the parties concerning the defendant’s guilty plea to the above-
referenced charges, and there are no other agreements, promises, undertakings, or understandings
between the defendant and the United States. The parties understand and agree that the terms of
this plea agreement can be modified only in writing signed by all of the parties and that any and
all other promises, representations, and statements whether made before, contemporaneous with,
or after this agreement, are null and void.

J. DOUGLAS OVERBEY
UNITED STATES ATTORNEY

Date Robert M. Reeves
Assistant United States Attorney

Date “Leslie Danielle Bethea »
Defendant Wj

Attorney for the Defendant

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