Interbank sent INS fraudulent documents, witness says

Foreign clients invested less than law required

April 04, 2001|By Walter F. Roche Jr. | Walter F. Roche Jr.,SUN STAFF

ALEXANDRIA, Va. - An admitted accomplice in what federal prosecutors contend was an illegal, multimillion-dollar visa scheme testified yesterday that a Virginia company owned by the defendants routinely submitted fraudulent documents to the U.S. Immigration and Naturalization Service on behalf of foreign clients seeking permanent residency in the United States.

Frank Ricci, 60, who has pleaded guilty to visa fraud and money laundering, told U.S. District Judge T. S. Ellis III that he also "misappropriated" $1.3 million from clients seeking permanent green cards under the decade-old investor visa program.

The law establishing the program, passed by Congress in 1990, eased immigration for foreigners willing to invest at least $500,000 in struggling U.S. businesses.

Ricci, a former well-known Florida immigration lawyer now working as a pizza deliveryman in West Palm Beach, Fla., was testifying as the key prosecution witness in the federal fraud and conspiracy case against James F. O'Connor and James A. Geisler, principals in a Herndon, Va., firm called Interbank.

Under questioning by Assistant U.S. Attorney Robert Spencer, Ricci said that in his routine presentation to prospective investors, he repeatedly assured them that despite the law's requirements, they had to invest only $100,000. Interbank, he promised, would "take care of the rest."

"I emphatically told them [clients] they were not responsible for the loan," he said.

Ricci said that after clients were signed up, documents were submitted to the INS showing that visa applicants had invested the full $500,000, when, in fact, they had not. He said he was told by Geisler and O'Connor that there was no need to tell INS that $400,000 was being provided through a loan.

"In retrospect, it was a false statement," he said of those applications.

Ricci, who is awaiting sentencing, said he teamed up with Interbank in 1997 to market the visa program internationally and had personally observed it being sold from a "boiler room" operation in Herndon.

He said he and Geisler made sales presentations in Hong Kong and Manila, in the Philippines. Asked if his sales pitch to potential investors was any different from Geisler's, Ricci replied: "Mine was better."

Eventually, Ricci testified, he came to question whether the loans existed and made a series of calls to the bank supposedly providing the financing. He said he was never able to find evidence that there were loans to make up the balance of the required investments.

O'Connor, he testified, became irate in 1998 when he learned that an FBI agent and an INS investigator had questioned an Interbank client about the financing arrangements.

When told that the client had acknowledged investing only $100,000, Ricci quoted O'Connor as saying: "What ... did he do that for?"

O'Connor "was very, very angry, and said this is going to be a problem," Ricci said.

Under cross-examination by O'Connor, who is acting as his own attorney in the nonjury trial, Ricci acknowledged being under treatment for depression. He said that after leaving Interbank, he set up his own investor visa program based on the Interbank model.

Ricci acknowledged that he had submitted the same false information to the INS on visa applications under his program as he had for Interbank's clients. But Ricci insisted that his program, unlike Interbank's, included "real loans."

O'Connor grilled Ricci about the $1.3 million in client funds that the lawyer admitted taking from escrow accounts. Ricci said he used the client funds to cover the expenses of marketing the Interbank program.

"You stole $1.3 million of your clients' money," O'Connor said.

"I didn't steal it. I misappropriated it," Ricci replied. "And I gave it back."

Asked if he broke the law, Ricci answered, "Yes."

The trial continues today with prosecutors presenting evidence on income tax charges against the two defendants.

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