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MICHIGAN COMPANY OFFICIALS SENTENCED IN RACKETEERING, CORRUPTION PROSECUTION
Release Date: 08/20/2001
Contact Information:
FOR RELEASE: MONDAY, AUGUST 20, 2001
MICHIGAN COMPANY OFFICIALS SENTENCED
IN RACKETEERING, CORRUPTION PROSECUTION
Luke C. Hester 202-564-7818/hester.luke@epa.gov
IN RACKETEERING, CORRUPTION PROSECUTION
Luke C. Hester 202-564-7818/hester.luke@epa.gov
Two men were sentenced on August 9 to over two years imprisonment each and a total $1 million in fines and restitution for committing an environmental offense under the Racketeering Influenced and Corrupt Organizations (RICO) Act. They were officials of Hi-Po of Northfield, Mich., who were sentenced for violating the Clean Water Act on two occasions. Aaron Smith of Northville, Mich., former president and owner, and Steven Carbeck of Ann Arbor, Mich., Hi-Po’s former operations manager, were sentenced. Smith received 33 months imprisonment and Carbeck 27 months. In addition, Smith will pay restitution of approximately $500,000 to several victims and he will also forfeit an additional $500,000 in funds obtained through illegal activity. Carbeck will be responsible to join Smith in paying $430,000 of the restitution. Hi-Po will pay a $50,000 fine and will make a total of $75,000 in restitution payments. In their guilty pleas in February, Hi-Po admitted intentionally releasing diesel fuel into a storm sewer and a pond in Ann Arbor to
make a fraudulent claim and receive payment from the University of Michigan and the Michigan Department of Environmental Quality to clean up the releases. Smith and Carbeck admitted that they illegally profited from Hi-Po’s unlawful activities. Smith’s RICO plea included illegal money laundering, mail fraud and bribery of a public official. Carbeck’s guilty plea included admission of money laundering and mail fraud. The case was investigated by EPA’s Criminal Investigation Division, the FBI and the University of Michigan Department of Public Safety. It was prosecuted by the U.S. Attorney’s Office in Detroit.
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