Boston Woman Charged with Scheme to Defraud Bankruptcy Courts.

BOSTON--(BUSINESS WIRE)--Sept. 17, 1998--Charges were filed today against a Boston, Massachusetts woman for bankruptcy fraud and mail fraud for filing false claims with bankruptcy courts in an attempt to collect debtor funds.

United States Attorney Donald K. Stern announced that a two-count criminal Information was filed today charging MARTHA DONOVAN, 35, of 679 LaGrange Street, Boston, Massachusetts, with engaging in a scheme to defraud bankruptcy courts by submitting false claims for funds held by those courts.

The information alleges that DONOVAN engaged in a scheme to submit false and fraudulent creditor claims to United States Bankruptcy Courts' unclaimed registry funds in locations around the country, in order to collect on claims to which she was not entitled and on behalf of persons and entities who had not authorized her actions. According to the Information, DONOVAN obtained a mailbox drop in the name of DeNapoli Refund Services Group, and represented herself to be Lori DeNapoli; then from October through December, 1997, DONOVAN prepared and submitted five false claims for payment to bankruptcy courts in Florida, Missouri and Colorado. Although the claimants were legitimate, DONOVAN had no authority to submit the claims on their behalf. DONOVAN used a variety of false names on the claims, representing them to be attorneys for DeNapoli Refund Services and notaries public. DONOVAN submitted claims totaling about $65,000.

DONOVAN faces 5 years in prison, a $250,000 fine, restitution, a $100 special assessment and three years of supervised release on each of the two counts charged.

The case was referred by the U.S. Trustees' Offices in Tampa, Florida and Boston, investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant U.S. Attorney Mark J. Balthazard of Stern's Economic Crimes Unit.