KENTUCKY
A former owner of Virgina-based Stonewood Marketing admitted stealing $1.1 million earmarked for political campaigns, PACs and non-profit organizations, according to officials.
One of the victims included the McConnell State Committee, officials said.
Defendant Samuel K. Pate Jr. used the stolen money to buy vacation condominiums, luxury automobiles and jewelry, officials said.
Campaigns, PACs and organizations contracted with Pate to process contributions. Pate diverted the money to his own personal account.
Pate, 52, of Forest, Virginia, owned and operated Stonewood Marking in Forest, Virginia.
Pate, a former vendor for multiple local, state and federal campaigns, political action committees (PACs) and non-profit organizations throughout the United States, including the McConnell Senate Committee, plead guilty to three charges of mail fraud today in U.S. District Court.
“Samuel Pate, while working in a position of trust for political campaigns, political action committees and non-profit groups, stole more than a million dollars,” said U.S. Attorney JohnKuhn Jr..
Adding, “These organizations – as well as earnest citizens trying to participate in the political process through contributions – were unknowingly victimized by Pate’s selfishness and avarice. He used the stolen funds for personal expenses, vacation homes, luxury vehicles and jewelry. Thus far, due to the efforts of my office and the FBI, nearly half of all the stolen funds have been recovered and are being returned to the victim organizations.”
The federal government has collected approximately $508,928 from Pate through seizures on bank accounts and the sale of forfeited property that Pate purchased with the stolen funds.
If convicted at trial, Pate faced no more than 60 years in prison.
WDRB 41 Louisville News
According to the federal information, from February 2008 through November 2014, Pate routinely misappropriated client funds by diverting funds from their designated accounts or transferring funds from client accounts into other bank accounts he controlled.
During the course of the scheme he stole donations and contributions totaling approximately $1,124,274.
These are the political campaigns, PACs and non-profit organizations:
- McConnell Senate Committee ($118,294)
- Christians in Defense of Israel ($319,691.09)
- House Conservative Fund ($30,614)
- Vitter for Senate (Louisiana) ($480,821.26)
- Catholic Advocates ($153,445)
- Jewish Voice ($150)
- Reagan Action ($1,025)
- Ten Commandments Commission ($2,098)
- Republican Majority Campaign ($11,300)
- Policy Issues Institute ($2,280)
- Defund Obamacare ($100)
- NRSC ($100)
- Randall Terry for Senate ($6)
- Freedom Defense Advocates ($990)
- Frontline Ministries ($1,150)
- Christian Anti-Defamation League ($2,020)
- Live Prayer ($190)
“Mr. Pate intentionally diverted campaign contributions and political action committee donations for his own personal financial gain,” said Special Agent in Charge Howard S. Marshall of the Louisville Division for the FBI. “As such, Mr. Pate’s actions subverted the political process by denying individuals their right to participate in the political process. In a democracy, there is simply no greater right than to elect our political leaders. Anyone attempting to corrupt the political process, in this way or any other, will be investigated as a top priority for our office.”
During this period, Pate used the stolen money to pay credit card bills, purchase vehicles, condominiums in Myrtle Beach, South Carolina, decorate a residence, pay family members and pay personal expenses.
Here is how Pate spent the stolen money:
- From February 2008 through November 2014 Pate paid approximately $284,841 in personal American Express credit card bills using stolen funds and transferred approximately $237,100 in stolen funds to his personal American Express savings accounts.
- From Oct. 21, 2010, through July 21, 2014, he used $28,104 in stolen funds from an Exodus Mandate account to pay condominium maintenance fees for both condominium unit 210 and unit 1015 located at 161 Seawatch Drive, Myrtle Beach, South Carolina.
- About Dec. 13, 2010, he used $10,800 in stolen funds from the Christian-Anti-Defamation Commission bank account to purchase a 2007 Jeep Compass
- About March 10, 2010, he used $14,765 in stolen funds from an Exodus Mandate bank account to a purchase a 2.02 carat diamond, round, H color, VS1 clarity
- About Aug. 26, 2010 Pate admits that he wire transferred $76,271.68 to a trust account for the purchase of a condominium identified as 161 Seawatch Drive, Unit 210, Myrtle Beach, Horry County, South Carolina.
- The wire transfer was drawn on a Christian Anti-Defamation Commission bank account.
- About Oct. 13, 2010, Pate used $8,800 in stolen funds from the Christian Anti-Defamation Commission bank account to purchase a 2004 Lincoln Navigator
- Around Jan. 7, 2011, Pate used $16,000 in stolen funds from a Christian anti-Defamation Commission bank account to purchase a 2007 Cadillac Escalade ESV
- On Dec. 22, 2011, Pate used $6,000 in stolen funds from the Exodus Mandate bank account to purchase a 2010 Cadillac SRX vehicle
- On April 28, 2013, the defendant used $9,999.45 in stolen funds from a Christian Anti-Defamation Commission bank account to purchase a 2007 GMC Acadia sport utility vehicle
- On July 8, 2012, the defendant used $17,250 in stolen funds from a Christian Anti-Defamation commission bank account to purchase a 2007 Jeep Wrangler sport utility vehicle
- On July 29, 2013, Pate purchased a condominium identified as 161 Seawatch Dive, Unit 1015 Myrtle Beach, South Carolina for $241,000.
- The stolen funds used for this transaction included the following: from the sale of 161 Seawatch Drive for $102,889.72; $39,050.46 from a Christian Anti-Defamation Commission bank account and $5,000 from an Exodus Mandate bank account.
- Between January 2014 through July 2014 Pate used $11,446.42 in stolen funds from an Exodus Mandate bank account to pay Sheila Morgan Interiors to redecorate his condominium.
- On May 8, 2014, Pate used $23,500 in stolen funds from the Exodus Mandate bank account to purchase a 2013 GMC Terrain sport utility vehicle.
- In June 2014 and July of 2014, the defendant used $9,300 in stolen funds from Exodus Mandate bank account to pay ACE Golf Carts for the purchase of a golf cart.
During this same period, Pate knowingly caused campaigns and PACS to file multiple false FEC Form 3, Report of Receipts and Disbursements, quarterly reports with the Federal Elections Commission that omitted the names and amounts of donor donations.