[Shadow_Group] Fw: Movers go on trial for alleged extortion

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AR Action Report Online.


Monday, November 15, 2004
 

Movers go on trial for alleged extortion

By Peter Lewis
Seattle Times consumer-affairs reporter

Erik Deri is one of four people
going on trial in the alleged scam.

FOUR people go on trial in federal court in Tacoma today on charges they
extorted customers in a household-moving scam by luring them with low
prices, then jacking up costs and holding their goods hostage until they
paid.

Now defunct, Woodinville-based Nationwide Moving Systems harmed more than
50 people, the government alleges. Actual and intended losses --
including the amount the defendants tried to defraud customers out of --
exceeded $1 million, prosecutors contend.

According to the government, the defendants would delay notifying
customers of the inflated prices until after their goods were loaded.
This had the effect of squeezing customers, the prosecutors say.

Some customers, for example, faced penalties from airlines if they
canceled previously scheduled travel arrangements; some were under
pressure because they had to relocate for a new job. Others were stuck
because their leases had expired or their homes had been sold and so they
had nowhere to stay, the government alleges.

Of seven people originally charged, three -- Martin Kirk II, 25, and
Michael Airgood and Kristen Klein, both 24 -- have pleaded guilty and
have agreed to testify against the remaining defendants.

They are: Erik Deri, 33; Yosef Nahum, 55; and Yuval Derei, 30, all of
whom are Israeli nationals facing deportation if convicted. Yuval Derei
is Erik Deri's brother. The fourth defendant, American-born Tanya Deri,
29, is Deri's wife.

According to charging papers, the investigation was sparked after a March
2003 Seattle Times article described customer experiences with
Nationwide.

Each of the defendants is charged with conspiracy to commit wire fraud
and interfere with commerce by extortion, which carries up to five years'
imprisonment and a $250,000 fine. In addition, they face multiple counts
of fraud and attempted extortion, each of which carries up to 20 years
and a $250,000 fine. Some of the defendants face additional charges.
Nationwide used the Web and the Yellow Pages to advertise, and it
sometimes purchased moving jobs from other moving companies. It falsely
represented itself as a reputable, insured and licensed moving company,
the prosecutors alleged. The scam started in May 2002 and ended in July
2003, the government said.

The trial has been delayed several times, most recently in August as a
result of a U.S. Supreme Court ruling that cast doubt on the
constitutionality of federal sentencing guidelines. The so-called
"Blakely" ruling, which grew out of a Washington state case, established
the principle that jurors, not judges, must decide the facts that
determine a criminal sentence.

As a result, U.S. District Judge Franklin Burgess of Tacoma recently
ordered the Nationwide case split into two parts. If jurors convict, they
would then reconvene to consider additional evidence, such as the
vulnerability and number of victims and amount of financial loss, that
could lead to stiffer punishment.

The trial is expected to last about a month. The government plans to
introduce roughly 400 exhibits and call nearly 100 witnesses, records
show.

Among the victims on the government's witness list is John Jennings, a
former Issaquah resident, who told The Times his move to Florida in
September 2002 was spoiled by Nationwide.

He said the company had revised the price upward from $3,000 to $16,000
-- and then refused his request to unload his possessions after he
objected. Ultimately, the total cost of his move, after hiring a
different company to retrieve, move and re-store his possessions,
exceeded $11,000.

Another victim scheduled to testify is Sarah DeLassus, who hired
Nationwide to move from Seattle to Antioch, Ill., in February 2003. She
said her belongings arrived two weeks later than promised. Virtually
everything she owned was broken, shredded, soiled, splintered or
otherwise mutilated, she and her mother said.

DeLassus estimated the loss at between $4,000 and $5,000. In addition,
several boxes of her belongings never arrived, she said.

DeLassus said the government's Seattle-based witness/victim coordinator
told her earlier this year that "she had never worked on a case where
people were so eager to participate" as opposed to feeling annoyed about
having to testify.
The defendants' attorneys have been mum about their trial strategy. But a
criminal-defense attorney familiar with the case said he expects the
defense will focus on the forms customers signed when they agreed to hire
Nationwide, specifically regarding permission to charge more if customers
underestimated how much stuff they had.

Lawyers for Tanya Deri and Yuval Derei have minimized their clients'
roles. At a hearing last year, for example, Jim Frush, representing Tanya
Deri, described her as "tangentially involved," a characterization
disputed by Assistant U.S. Attorney Kathryn Warma.

Deri's lawyer, Peter Camiel, said his client responded to his older
brother's (Erik Deri's) invitation to join the business, but didn't start
working for Nationwide until March 2003. Derei worked primarily as a
dispatcher and had "very limited contact" with customers, Camiel
contended.

A development that could be useful for the defense was the firing earlier
this year of the government's case agent: Melanie Jaimerson, a
Seattle-based special agent with the Department of Transportation's
Office of the Inspector General.

Defense attorneys were eager to learn whether her dismissal was related
to the Nationwide case. But after her personnel file was submitted to the
court under seal, Burgess said it was not.
Still, the defense has copies of the interviews Jaimerson conducted with
witnesses. If the witnesses tell a different story under oath than they
told her, the defense could use the transcripts to impeach their
credibility. And because the government has scratched Jaimerson from its
witness list, she would not be available to assist in countering such
attacks.

If history is any measure, the defendants face an uphill battle.

The Seattle prosecution is similar to other recent federal extortion
cases that implicated Israeli-run moving companies around the country,
including California, New York and Florida. In virtually every instance,
the defendants pleaded guilty or were convicted by jurors, officials
said.

In the Nationwide case, prosecutors plan to present a household-goods
moving-industry expert to testify about standard practices adopted to
avoid customer fraud, obtain accurate moving estimates and resolve
consumer complaints.

By contrast, Nationwide customers will testify that their goods were
damaged and/or stolen, and that their efforts to file claims with the
company were typically "rebuffed, ignored, or evaded," the government
said in court papers. And in some cases, the defendants stole household
goods entrusted to Nationwide's care, the government contends.

Peter Lewis: phone 206-464-2217

Copyright © 2004 The Seattle Times Company

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