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FIRST ALERT INVESTIGATION: Summit case is “complex”, prosecutors say

(WBAY)
Published: Feb. 17, 2022 at 6:03 AM CST
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GREEN BAY, Wis. (WBAY) - Court dates in a federal fraud case involving a now defunct contracting company could be pushed back due to the complexity of the case.

In February, a 10-count indictment alleging conspiracy to commit wire and financial institution fraud was handed down in the Summit Contracting fraud investigation. Federal charges were filed against owners Nate Smith and Chad Schampers; Chad’s wife Gina Schampers; and lead salesman Jeffrey O’Brien.

The case was scheduled to go to trial April 11. However, the U.S. Attorney’s Office has asked for the case to be classified as “complex” due to the vast amount of paperwork. A “complex” case would likely void the speedy trial designation and could push back court dates.

First Alert Investigation obtained the motion filed in the United States District Court.

MOTION FOR A PRETRIAL SCHEDULING CONFERENCE

“This case involves well over 30 GB of data, including over 3,400 documents.

“Much of the discovery involves personally identifiable information (”PII”) which normally requires redaction prior to being turned over to the defendants and their respective counsel. The government intends to petition the Court for a protective order which would allow for a more expeditious turnover of discovery without redaction being required. The government intends to address this issue with the Court and parties at a pretrial scheduling conference.

“Given the large amount discovery accumulated over an approximately three year investigation, as well as the number of potential witnesses that may testify at trial, the parties are in agreement that the case should be declared complex pursuant to Title 18, U.S.C. ‘ 3161(h)(7)(B)(ii), (iv), and Criminal Local Rule 12(a)(1).

“The government has contacted each of the attorneys in this case and represents that they are in support of designating the case as complex.”

Prosecutors allege the four used deceptive, misleading tactics to trick customers into loans for work, that in comes cases, was never completed or started.

The indictment accuses them of “executing a scheme to defraud” by recruiting customers, financing home improvement loans, then receiving payment for uncompleted or partially completed projects.

As we reported, the FBI began investigating wire fraud and banking violations by Summit Contracting in June, 2019. Data from the Small Business Administration indicated Summit Contracting received a PPP loan between $150,000 and $350,000. SBA data listed the company as being female-owned, but Summit’s attorney told us that seemed to be a clerical error and Chad Schampers was running the company.

Nine days before the SBA approved Summit’s loan request, the company had responded to a consumer complaint on the Better Business Bureau’s website saying the company is “closed” and “now out of business.”

According to the federal indictment obtained by FIRST ALERT INVESTIGATES, from 2018 to October 2019, the Schampers, Smith and O’Brien “knowingly conspired... to defraud homeowners, financial institutions and others by means of interstate wire communications, and by concealing material facts from federally insured financial institutions.”

The indictment alleges Summit Contracting sales representatives “working at the direction of the defendants” used deceptive and high-pressure sales tactics and made false statements to win over customers and convince them to finance the remodeling projects with Summit’s chosen financial institutions, then the defendants withdrew funds before any work was started or the necessary materials were ordered.

Among the claims sales representatives made was that Summit didn’t use subcontractors when a majority of the work was, in fact, done by subcontractors. Some customers, just hours after they heard the sales pitch, were pushed to sign paperwork saying the work was completed.

Last February, the home remodeling business agreed to a civil injunction in federal court to discontinue its financing practices after prosecutors accused it of “a fraudulent scheme” misrepresenting the terms of financing, making false statements that work was complete, and withdrawing payment without the customer’s knowledge. The agreement closed the civil case but the FBI’s criminal investigation continued.

The wire fraud charge carries up to 20 years in prison. Money laundering could add another 10 years.

The conspiracy charges seek the forfeiture of the defendants’ property and money from the crimes in the amount of the ill-gotten gains. The FBI says the defendants wrongfully obtained, or tried to obtain, more than $1.5 million.

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