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FOR THE DISTRICT OF COLUMBIA
UNITED STATES AMERICA v. MICHAEL WAYNE MARTIN,
18 U.S.C. § 1956(h) (Conspiracy to Launder Proceeds of an Unlawful
18 U.S.C. § 2 (Aiding and Abetting and Causing An Act to be Done)
The United States Attorney charges that:
At all times material to the Information:
(Conspiracy to Launder Proceeds of au Unlawful Activity)
1. The Washington Teachers' Union ("WTU" or
"the union") was a labor organization representing, among other
persons, teachers in the District of Columbia Public School system, and
was the Washington, D.C. local affiliate of the American Federation of
Teachers ("AFT"). WTU received most of its funds from dues
collected from the paychecks of its schoolteacher members.
2: WTU was a labor organization under the oversight of
the United States Department of Labor ("DOL") and was required.
annually to submit reports of its financial condition ("Forms
LM-2") to DOL. Forms LM-2 required disclosure of, among other things,
disbursements to officers and employees, including, but not limited to,
payments of salary and other remuneration, as well as payments to officers
and employees for business expenditures. DOL maintained these Forms LM-2
for inspection by union members, who were entitled to rely on the accuracy
of the information disclosed.
3. WTU's operations were overseen, or should have been
overseen, by an executive board consisting of, among other persons, the
persons occupying the offices of WTU President, WTU General
Vice-President, and WTU Treasurer. For all periods relevant to this
Information, the persons occupying these offices did not change,
4. WTU President was a full-time, salaried official of
WTU. WTU Treasurer was at various times a full-time, salaried official of
5. WTU President was assisted in his/her job by WTU
Executive Assistant, who was at all times a full-time, salaried employee
6. WTU checks were required to be signed by two of the
three persons occupying the positions of WTU President, WTU General
Vice-President, and WTU Treasurer. WTU President also delegated to WTU
Executive Assistant authority to affix a stamp of WTU President's
signature to WTU checks. WTU Executive Assistant did, in fact, write many
WTU checks, affix WTU President's signature stamp, and obtain WTU
Treasurer's actual signature.
7. Defendant MICHAEL MARTIN, WTU Executive Assistant,
occasionally styled WTU President's hair and gave WTU President fashion
8. From in or about July 199$, the exact date being
unknown, through in or about October 2002, within the District of Columbia
and elsewhere, defendant MICHAEL MARTIN did unlawfully, willfully, and
knowingly conspire, confederate, and agree, together with others known and
unknown, to commit offenses deed in Title 18, United States Code, Sections
1956 and 1957, as follows:
in violation of Title 18, United States Code, Section 1956(a)(1)(B)(i);
a. knowing that the property involved in a financial
transaction affecting interstate commerce represented the proceeds of
some form of unlawful activity, to conduct and attempt to conduct such a
financial transaction which in fact involved the proceeds of specified
unlawful activity, to wit, embezzlement of a labor organization's
assets, in violation of Title 29; United States Code, Section 501(c),
knowing that the transaction was designed. in whole and in part to
conceal and disguise the nature, the location, the source, the
ownership, and the control of the proceeds of specified unlawful
b. knowingly to engage and attempt to engage in a monetary
transaction in criminally derived property from specifed unlawful
activity, to wit, embezzlement of a labor organization's assets, in
violation of Title 29, United States Code, Section 501(c), of a value
greater than $10,000, in violation of Title 18, United States Code,
THE GOAL OF THE CONSPIRACY
9. It was the goal of the conspiracy for defendant MICHAEL MARTIN and his
coconspirators to enrich themselves by stealing millions of dollars from
WTU members and to secrete their unlawful conduct by engaging in financial
transactions designed to conceal and hide the unlawful derivation of these
MANNER AND MEANS OF THE CONSPIRACY
10. It was part of the conspiracy that WTU President,
WTU Treasurer, and WTU Executive Assistant would write checks to defendant
MICHAEL MARTIN and others so that the money could be used personally by
WTU President and WTU Executive Assistant and be used to pay WTU credit
card bills incurred through the purchase of personal goods and services by
WTU President, WTU Treasurer, and WTU Executive Assistant.
11. It was further a part of the conspiracy that
defendant MICHAEL MARTIN and a "business" partner
("`Business' Partner") opened an account at a federally-insured
financial institution in the name of a fictitious business association
called "Expressions Unlimited," which was controlled and used by
defendant MICHAEL MARTIN, defendant MICHAEL MARTIN's wife (WTU Executive
Assistant's daughter), and `Business" Partner, and the signatory for
which was `Business" Partner.
12. It was further apart of the conspiracy that the purpose of the
"Expressions Unlimited" account was to launder W WTU funds in a
manner directed by WTU President and WTU Executive Assistant, including
concealing the embezzlement of union funds, by making it appear that
expenditures of WTU funds for personal purposes had been reimbursed by WTU
13. It was further apart of the conspiracy that WTU
President, WTU Treasurer, and WTU Executive Assistant would and did write
WTU checks for several thousand dollars at a time, ultimately totaling
$483,543.21, to defendant MICHAEL MARTIN in the name of Expressions
14. It was further a part of the conspiracy that defendant MICHAEL MARTIN
would receive direction from WTU Executive Assistant and/or WTU President
as to how much money to withdraw from the Expressions Unlimited account
and how to distribute the proceeds, including but not limited to cashing
checks and distributing cash to WTU Executive Assistant and WTU President
or writing checks drawn on the Expressions Unlimited account and
depositing such checks into accounts controlled by WTU Executive Assistant
and WTU President.
15. It was further a part of the conspiracy that
defendant MICHAEL MARTEN, aided and abetted by "Business"
Partner and others known and unknown, would and did deposit WTU checks
into the Expressions Unlimited account and give some or all of the
proceeds directly to WTU Executive Assistant and WTU President.
16. It was further apart of the conspiracy that
defendant MICHAEL MARTIN, aided and abetted by "Business"
Partner and others known and unknown, would and did deposit WTU checks
into the Expressions Unlimited account and, in tam, withdraw funds from
the Expressions Unlimited account to deposit directly into the personal
bank account of WTU President.
17. It was further apart of the conspiracy that
defendant MICHAEL MARTIN and others known and unknown would and did forge
"Business" Partner's signature on Expressions Unlimited checks.
18. It was further a part of the conspiracy that WTU President, WTU
Treasurer, and WTU Executive Assistant concealed, and sought to conceal,
the payment of funds to defendant MICHAEL MARTIN and Expressions Unlimited
by creating and causing the creation of false; fictitious, and fraudulent
WTU payment vouchers to support checks written to Expressions Unlimited.
19. It was further a part of the conspiracy that the
conspirators sought to conceal and cover up their embezzlement and
laundering of criminal proceeds by creating false, fictitious, and
fraudulent Expressions Unlimited "invoices" for submission to
auditors of WTU retained by AFT.
20. It was further a part of the conspiracy that
defendant MICHAEL MARTIN would keep some of the money deposited into the
Expressions Unlimited account through his use of a debit bank card drawn
on the Expressions Unlimited account, as well as by writing, or causing
the writing of, Expressions Unlimited checks, to pay for a variety of
personal expenses, including his home mortgage, credit card bills, car
notes, vehicle maintenance, and home improvement projects.
21. It was further a part of the conspiracy that WTU
President, WTU Treasurer, and WTU Executive Assistant embezzled and stole
more than $1 million in WTU's assets by obtaining cash withdrawn
unlawfully from the WTU bank account, writing WTU checks to themselves,
and using WTU credit cards to acquire luxury clothing, electronic
equipment, season tickets for professional sports events, meals and other
entertainment, home furnishings, art; gasoline and repairs for their
personal vehicles, and other items.
22. It was further a part of the conspiracy that
defendant MICHAEL MARTIN, while being compensated by WTU and WTU
President, would and did transport WTU President to engage in spending
sprees using WTU funds and credit cards, and would and did make orders of
clothing, art, and other items for the President's personal use that were
obtained unlawfully by using union funds.
23. It was further a part of the conspiracy that the
conspirators caused WTU to pay for repairs and maintenance for vehicles
owned personally by defendant MICHAEL MARTIN.
24. It was further a part of the conspiracy that the conspirators caused
WTU to pay for personal trips for defendant MICHAEL MARTIN and lavish
parties unrelated to WTU business held at defendant MICHAEL MARTIN's
25. It was further a part of the conspiracy that the conspirators would
and did create, and plan to create, false and misleading "financial
statements," which concealed and sought to conceal the conspirators'
conversion of union funds by falsely and fraudulently categorizing
hundreds of thousands of dollars of personal expenditures on WTU credit
cards, payments on a personal credit card balance of WTU President and
his/her sister, and payments to defendant MICHAEL MARTIN,
"Business" Partner, and the fictitious "Expressions
Unlimited" as legitimate expenditures, describing these unlawful
expenditures as, among other things, "Membership Services,"
payments of "per capita tax" (dues owed by WTU to AFT), and
26. It was further a part of the conspiracy that WTU
President, WTU Treasurer, and WTU Executive Assistant, along with others
known and unknown, would and did retain the services of Tax Preparer --
who also prepared the personal tax returns of defendant MICHAEL MARTIN and
WTU President, among others -- to assist them in the preparation of Forms
LM-2 and "financial statements" that were false and misleading.
PARTIAL LIST OF FINANCIAL TRANSACTIONS UNDERTAKEN IN
FURTHERANCE OF THE CONSPIRACY
27. In furtherance of the goal and objects of the
conspiracy, defendant MICHAEL MARTIN and his co-conspirators, known and
unknown, within the District of Columbia, conducted the following
financial transactions, among many others:
||On or about Date
||Deposit of WTU check into Expressions Unlimited
||Purchase of cashier's check payable to WTU President
personally, using funds from Expressions Unlimited account
||WTU President withdraws funds from WTU President's
personal account by personal check payable WTU credit card account
(Conspiracy to Launder Proceeds of an Unlawful
Activity, in violation of Title 18, United States Code, Section 1956(h),
and Aiding and Abetting and Causing An Act to be Done, in violation of
Title 18, United States Code, Section 2).
ROSCOE C. HOWARD, JR.
ATTORNEY FOR THE UNITED STATES IN
AND FOR THE DISTRICT OF COLUMBIA
J W. COOPER
ANTHONY M. ALEXIS
ASSISTANT UNITED STATES ATTORNEYS