18 u.s.c. j 1349 18 u.s.c. j 1341 18 u.s.c. j 2326 18 u.s.c. j 2 18 … · 2020-05-30 · stuart m....

UNITED STATES DISTRICT COURTSOUTHERN DISTRICT OF FLORIDA

CASE NO.

18 U.S.C. j 134918 U.S.C. j 134118 U.S.C. j 232618 U.S.C. j 218 U.S.C. j 981(a)(1)(C)

UNITED STATES OF AM ERICA

VS.

PETER D. KIRSCHNER,STUART M . RUBENS,

DEAN R. BAKER, and

BRET A. GROVE,

Defendants.

/

INDICTM ENT

The Grand Jury charges that:

G ENERAL ALLEG ATIONS

At a11 times relevant to this Indictment:

1. Thought Development, lnc. ($'TDI'') was incorporated in 2010 to develop and

market a portfolio of products and inventions, including a StFirst Down Laser System''

teclmology designed to mark tsrst downs in collegiate and professional football games, including

NFL games. TDl claimed that its laser system generated a green line on the fleld visible in the

stadium to players, fans and on television. TDl represented that use of its technology would

decrease the time used by officials to detennine first downs, freeing broadcast tim e that could be

sold to television advertisers. TDl's principal place of business was located in M iami Beach,

Florida.

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July 24, 2014

14-20514-CR-GAYLES/TURNOFF

Case 1:14-cr-20514-DPG Document 1 Entered on FLSD Docket 07/24/2014 of 15

Advanced Equity Partners, LLC (i:AEP'') was a Florida limited liability company

formed in 2012, with its principal place of business in Hollywood, Florida. AEP sold TDI stock

through the use of sales agents that used telemarketing to solicit investors.

3. Premiere Consulting, LLC Cipremiere'') was a Florida limited liability company

fonned in 2010, with its principal place of business in Hollywood, Florida. Premiere sold TDl

stock through the use of sales agents that used telemarketing to solicit investors.

4. DDBO Consulting was a Florida corporation formed in 2010 with its principal

place of business in Fort Lauderdale, Florida.DDBO Consulting sold TDl stoek through the use

of sales agents that used telemarketing to solicit investors.

5. DBBG Consulting was a Florida corporation fonned in 2012 with its principal

place of business in Fo14 Lauderdale, Florida. DBBG Consulting sold TDI stock through the use

of sales agents that used telemarketing to solicit investors.

Defendant PETER D. KIRSCHNER resided in Delray Beach, Florida and was a

managing member of both Premiere and AEP.

Defendant STUART M . RUBENS resided in North Miami, Florida and was a

managing member of both Premiere and AEP.

8. PETER D. KIRSCHNER and STUART M . RUBENS founded Premiere and

AEP, and hired and paid sales agents to solicit investors to purchase stock in TDI.

9. Defendant DEAN R. BAKER resided in Coral Springs, Florida. BAKER was

the president of both DDBO Consulting and DBBG Consulting.

Defendant BRET A. GROVE resided in Delray Beach, Florida. GROVE was

the vice president of DBBG Consulting.

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CO UNT 1CONSPIR ACY TO CO M M IT M AIL FRAUD

(18 U.S.C. j 1349)

l . Paragraphs 1 through 10 of the General Allegations section of this lndictm ent are

re-alleged and incorporated by reference as if fully set forth herein.

From in or around October 2010, through in or around Novem ber 2012, in

M iami-Dade and Broward Counties, in the Southern District of Florida, and elsewhere, the

defendants,

PETER D. KIRSCHNER,

STUART M . RUBENS,

DEAN R. BAKER, and

BRET A. G ROVE,

did willfully, that is, with the intent to further the object of the conspiracy, and knowingly

combine, conspire, confederate and agree with each other and with others known and unknown

to the Grand Jury to knowingly, and with intent to defraud, devise and intend to devise a scheme

and artitice to defraud and to obtain money and property by means of materially false and

fraudulent pretenses, representations, and prom ises, knowing that the pretenses, representations,

and promises were false and fraudulent when made, and to knowingly cause to be delivered

certain mail matter by the United States Postal Service and by private or commercial interstate

canier, according to the directions thereon, in violation of Title 18, United States Code, Section

1341.

PURPOSE OF TH E CONSPIR ACY

lt was the purpose of the conspiracy for the defendants and their co-conspirators

to unlawfully enrich themselves by misappropriating investor money for their personal use and

benefit by making material m isrepresentations and concealing and failing to state m aterial facts

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concerning, among other things, the safety and profitability of TD1 stock, the use of investor

funds, and the defendants' commissions and fees.

M ANNER AND M EANS OF TH E CONSPIR ACY

The marmer and means by which the defendants and their co-conspirators sought to

accomplish the object and purpose of the conspiracy included, among others, the following:

4. ln 2010, TD1 hired PETER D. KIRSCHNER and STUART M. RUBENS to

raise capital by selling TDl stock.

ln approximately June 201 1, PETER D.KIRSCHNER contacted DEAN R.

BAKER to solicit potential investors to purchase TD1 stock.

6. PETER D. KIRSCHNER, STUART M . RUBENS, DEAN R. BAKER

, BRET

A. GROVE, and their co-conspirators, directly and through their sales agents at Premiere

, AEP,

DDBO Consulting, and DBBG Consulting, solicited, offered, and sold TDI stock to investors

located throughout the United States.

7. Sales agents, serving as tifrontersy'' used lead lists eonsisting of contact

information for potential investors. A large percentage of the potential investors contained on

the lead lists were elderly. Through telemarketing, fronters made initial contact with potential

investors, then referred investors interested in investing in TD1 to the defendants and their co-

conspirators to complete the stock purchase transaction.

8. To sell TDl stock, the defendants and their co-conspirators, directly and through

their sales agents told investors about a purported pending initial public offering (''IPO'') of TDl

stock, as well as the laser teclmology's use in the NFL. Specitically, investors were told that the

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company would élshortly go public'' and that the laser technology would be used in the Super

Bowl.

9. The defendants and their co-conspirators, directly and through their sales agents

told investors to invest in TDl because it was a good investment and that the investors would

puportedly make guaranteed, significant returns on their investment. For example, sales agents

told investors that the TDl share price would increase from $2.50 to $8.00 after TD1 completed a

pending deal with the NFL.

10. The defendants and their co-conspirators, directly and through their sales agents

falsely and fraudulently told investors the proceeds of their investments would go directly to TDI

to develop the First Down Laser System technology, capitalize the company, and fùnd operations

until its pending public offering.

of TD1 stock, the defendants and their co-

conspirators, directly and through their sales agents provided investors with promotional packets

that contained brochures and other false and fraudulent sales material describing TDl and its

First Down Laser System .

During the course of their sale

l2. The defendants, their co-conspirators, and their sales agents, including through

DDBO Consulting and DBBG Consulting, directed investors to send all payments for TDI stock

transactions to Premiere and AEP. PETER D. KIRSCHNER and DEAN R. RUBENS, directly

and through Premiere and AEP, used the money received to pay substantial commissions and

fees to themselves, DEAN R. BAKER and BRET A. GROVE, co-conspirators

, and sales

agents. BAKER and GROVE also paid sales agents commissions through DDBO Consulting

and DBBG Consulting bank accounts. The com missions and fees ranged from at least 50% to

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75% of investor proceeds.

from a given transaction.

13.

ln certain instances, KIRSCHNER and RUBENS kept all proeeeds

Aher receiving investor proceeds for the sale of TD1 stock, the defendants and

their co-conspirators generated and forwarded false

including bogus stock purchase

contsrming purchases of TDl stock. However,

agreements and bogus transaction confirmation letters

and fraudulent documents to investors,

instead of delivering shares of TDI, investors

received shares of AEP or no shares at all.

14. To induce investors to provide the defendantsand their co-conspirators money,

PETER D. M RSCHNER, STUART M . RUBENS, DEAN R. BAK ER , BRET A. GROVE,

and their co-conspirators, directly and tlzrough their sales agents made

, and caused others to

make, numerous materially false and fraudulent statements to investors, and concealed and

omitted to state, and caused others to conceal and omit to state, m aterial facts to investors

,

including, among others things, the following:

M ateriallv False Statem ents

(a) That TD1 was about to go public;

(b) That investor proceeds would be used to develop TDl's technology and to fund a

purported lPO of TD1 stock;

(c) That investor returns were guaranteed;

(d) That the value of TDl stock would increase significantly;

That (1) TD1's First Down Laser System technology would be used during NFL

preseason and regular season games, (2) that the NFL had agreed to use TDI's technology during

6

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the NFL'S training season and during the 2013 Super Bowl, and (3) that based on the technology

,

the NFL and TD1 were splitting advertising revenues;

(1) That no eommissions or fees would be charged to investors- tsnot even a dime''-

or that only 10% of investor funds went to fees and commissions;

(g) That investors had purchased shares of TD1 stock;

Concealment and Omissions of M aterial Facts

(h) That the defendants and their co-conspirators used at least 50% of a given

investment as commissions or fees, or misappropriated al1 ofthe investor proceeds; and

(i) That the First Down Laser System posed a potential risk of blindness to players

on the football field.

That TDI had no agreement with the NFL to use TDI's technology.

Over the course of the scheme, PETER D. KIRSCHNER, STUART M .

RUBENS, DEAN R. BAKER, and BRET A. GROVE , their co-conspirators, directly and

through their sales agents falsely and fraudulently caused over 200 individuals to invest in TDI,

approximately two-thirds of whom were over the age of 65, and raised approximately $2.4

million in sales of TD1 stock, misappropriating nearly all of the money as undisclosed

commissions and fees.

t)

A11 in violation of Title 18, United States Code, Sections 1349 and 2326.

CO UNTS 2-4M AIL FR AUD

(18 U.S.C. j 1341)

Paragraphs 1 through 10 of the General Allegations section of this lndictment are

realleged and incorporated by reference as though fully set forth herein.

7

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From in or around October

Miami-Dade and Broward Counties, in

2010, through in or around November 2012, in

the Southern District of Florida, and elsewhere, the

defendants,

PETER D. KIRSCHNER,

STUART M . RUBENS,

DEAN R. BAKER, and

BRET A. GROVE,

did knowingly and with intent to defraud, devise and intend to devise a scheme and artitsce to

defraud and to obtain money and property by means of materially false and fraudulent pretenses

,

representations, and promises, knowing that the pretenses, representations, and prom ises were

false and fraudulent when made, and did knowingly cause to be delivered certain mail matter by

private or commercial interstate canier, according to the directions thereon.

PURPOSE OF THE SCHEM E AND ARTIFICE

It was the purpose of the scheme and artifice for the defendants and their

accomplices to unlawfully enrich themselves by misappropriating investor money for their

personal use and benefit by making material misrepresentations and concealing and failing to

state material facts conceming, among other things, the safety and protitability of TDl stock, the

use of investor funds, and the defendants' commissions and fees.

THE SCHEM E AND ARTIFICE

Paragraphs 4 through 1 5 of the Manner and M eans Section of Count1 are

realleged and incomorated by reference herein as a description of the scheme and artifice.

USE OF THE M AILS

On or about the dates enumerated below, the defendants, for the purpose of

executing and in furtherance of the scheme and artifice to defraud and to obtain money and

8

5.

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property by means of materially false and fraudulent pretenses, representations, and prom ises

,

knowing that the pretenses, representations, and promises were false and fraudulent when made

,

did knowingly cause to be delivered certain mail matter by a private or commereial interstate

carrier, according to the directions thereon, as more particularly described below:

COUNT APPROX. DATE DESCRIPTION OF M AILING

2 March 15, 2012 Check # 151

, drawn on Investor J.S.' account, sent via U .S.Mail by lnvestor J.S. in Albuquerque, New M exico to AEP

in the Southern District of Florida

M ay 18, 2012 Check # 1567, drawn on Investor V .M .'S account, sent via

Federal Express by lnvestor V.M . in M uscatine

, lowa toAEP in the Southern District of Florida

4 June 19, 2012 Check # 102 1, drawn on lnvestor F.A.'S account, sent viaFederal Express by lnvestor F

.A. in W atsonville, Californiato AEP in the Southern Distrid of Florida

ln violation of Title 18, United States Code, Sections 1341, 2326, and 2.

FORFEITURE

(18 U.S.C. j 981(a)(1)(C))

The allegations of this lndictment are re-alleged and by this reference are fully

incorporated herein for the purpose of alleging fbrfeiture to the United States of America of

certain property in which the defendants have an interest.

Upon conviction of any of the offenses alleged in Counts l tlurugh 4 of this

Indictment, the defendants, PETER D. KIRSCHNER, STUART

BAKER, and BRET A. GROVE,

M . RUBENS, DEAN R.

shall forfeit to the United States any property, real or

personal, which constitutes, or is derived from , proceeds traceable to such violations.

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United States Code, Section 981(a)(1)(C), made applicable

tluough Title 28, United States Code, Section 2461(c), and the procedures set forth at Title 21

,

United States Code, Section 853.

A11 pursuant to Title 18,

A a-Rujsyj

föRspERsox

l p / (W IFREDO A. FERRER

UNITED STATES ATTORNEY

OGER CRUZ

ASSISTANT ITED STATES ATTORNEY

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UNITED STATES DISTRIG COURTSOUTHERN DISTRIG OF FLORIDA

UNITED STATES OF AM ERICA

VS.

PETER D. KIRSCHNER, et aI.,

Defendants.

/

Court Division: (select one)

X Miami Key W estFTL W PB

l do hereby certify that:

CASE NO.

CERTIFICATE OF TRIAL AU ORNEY*

superseding Ease Information:

New Defendantts)Number of New DefendantsTotal number of counts

YeS No

FTP

l have carefully considered the allegations of the indictment, the number of defendants

, the number ofprobable witnesses and the legal complexities of the lndictment/lnformation attached hereto

.

l am aware that the information supplied on this statement wi'i be relied upon by the Judges of this Court insetting thei

r calendars and scheduling crim inal trials under the mandate of the Speedy Trial Act

. Titie 28U.S.C. Section 3161.

lnterpreter: (Yes or No) NoList language and/or dialect

This case wiil take 6-10 days for the parties to tfy.

Please check appropriate category and type of offense listed below:

( Che C k on Iy () ne ) ( Che c k o n Iy o ne )

4.

5.

0 to 5 days6 to 10 days11 to 20 days21 to 60 days61 days and over

XPettyM inorM isdem.Felony X

6. Has this case been previously filed in this District Court?If yes:Judge: Case No

.(Attach copy of dispositive order)Has a complaint been filed in this matter? (Yes or No)

(Yes or No) No

NoIf yes:

Magistrate Case No.Related Miscellaneous num bers:Defendantts) in federal custody as ofDefendantls) in state custody as ofRule 20 from the Dlstrlct o

ls this a potential death penalty case? (Yes or No)

Does this case originate from a matter penàing in the Northern Region of the U.S. Attorney's Office prior toOctober 14

, 2003? Yes X No

Does this case originate from a matter pending in the Central Region of the U.S. Attorney's Office prior toSeptember 1

, 2007? Yes X No8.

*penalty Sheetls) attached

ROGCR CRUZA< . ASSISTANT U ED STATES AU ORNEY

Florida Bar No. 157971

REv 4/8/08

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF FLORIDA

PENALTY SHEET

Defendantfs Name: Peter D. Kirschner

Case No:

Count #: 1

Conspiracy to Commit M ail Fraud

Title 18. United States Code. Sections 1349 and 2326

* M ax.penalty: 30 years' imprisonment

Counts #: 2-4

Mail Fraud

Title 18. United States Code. Sections 1341and 2326

* M ax.penalty: 30 years' imprisonment as to each count

WRefers only to possible term of incarcerationy overlap does not include possible fints,restitution, special assessm ents, parole term s, or forfeitures that m ay be applicable

.

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PENALTY SHEET

Defendant's Name: Stuart M. Rubens

- - - - -

Case No:

Count #: 1

Conspiracv to Commit Mail Fraud

Title 18. United States Codes Sections l 349 and 2326

# M ax.penalty: 30 years' imprisonment

Counts #: 2-4

M ail Fraud

Title 18. United States Code. Sections 134land 2326

+ M ax.penalty: 30 years' imprisonment as to each count

*Refers only to possible term of incarceration. overlap does not include possible fines,restitution, special assessm ents, parole term s, or forfeitures that m ay be applicable

.

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PENALTY SHEET

Defendant's Name: Dean R. Baker

Case No:

Count #: 1

Conspiracy to Commit M ail Fraud


-6 - .

* M ax.penalty: 30 years' imprisonment

Counts #: 2-4

M ail Fraud


* Max.penalty: 30 years' imprisonmpnt ps to raq!A cpupt - -

*Refers only to possible term of incarceration, overlap does not include possible fines,restitution, special assessm ents. parole term s, or forfeitures that m ay be applicable

.

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT O F FLO RIDA

PENA LTY SHEET

Dèfendant's Nam e: Bret A. G rove

Case No:

Count #: 1

Conspiracy to Comm it M ail Fraud


# M ax.penalty: 30 years' imprisonment

Counts #: 2-4

M ail Fraud

Title 18. United States Codes Sections 1341 and 2326

# M ax.penalty: 30 years' imprisonment as to each count

WRefers only to possible term of incarceration, overlap does not include possible fines,restitution, special assessm ents, parole term s, or forfeitures that may be applicable.

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18 u.s.c. j 1349 18 u.s.c. j 1341 18 u.s.c. j 2326 18 u.s.c. j 2 18 … · 2020-05-30 · stuart m....

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