Owners Of NJ Scrap Metal Company Charged With 17-Year Conspiracy To Defraud Customers

https://www.justice.gov/usao-nj/pr/owners-hudson-county-new-jersey-scrap-metal-company-charged-17-year-conspiracy-defraud

Department of Justice
U.S. Attorney’s Office
District of New Jersey

FOR IMMEDIATE RELEASE
Wednesday, August 2, 2017

Owners Of Hudson County, New Jersey, Scrap Metal Company Charged With 17-Year Conspiracy To Defraud Customers

Former Chief Financial Officer Has Pleaded Guilty to Related Charge

NEWARK, N.J. – The owners of Cinelli Iron & Metal Co. (CIMCO) were arrested today and charged with operating a 17-year conspiracy that defrauded customers out of millions of dollars, Acting U.S. Attorney William E. Fitzpatrick announced. Craig Cinelli, 47, of Allendale, New Jersey, and his brother, Joseph Cinelli Sr., 61, of Montvale, New Jersey, are charged by indictment with one count of conspiracy to commit wire fraud and five counts of wire fraud. They were arrested this morning and are expected to appear this afternoon before U.S. Magistrate Cathy L. Waldor in Newark federal court.
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CIMCO, which was headquartered in Secaucus, New Jersey, purchased scrap metal for resale and operated three scrap metal recycling facilities in New Jersey. CIMCO trucks would deliver scrap metal containers to customer jobsites and remove them after they were filled. CIMCO then purportedly paid customers based on the type and net weight of the scrap material.

From 1999 through March of 2016, Craig Cinelli, Joseph Cinelli Sr., Barteck and others allegedly used a variety of fraudulent business practices to buy scrap metal from CIMCO’s customers for less than CIMCO should have paid. The company then resold the scrap metal at a profit. Instead of paying the proper, agreed-upon amounts for the actual weight, members of the conspiracy used a variety of techniques to misrepresent the true weight and type of the scrap metal, including altering documents to reflect a lower weight, removing scrap metal from a haul before it was weighed and misrepresenting the types of scrap metal contained in a haul.
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During his plea hearing, Barteck admitted that the loss caused by the conspiracy that was reasonably foreseeable to him was more than $9.5 million, but less than $25 million. His sentencing is scheduled for Oct. 30, 2017.
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