Missouri man sentenced to 3 years in federal prison for fraud and tax offenses

Date: Sept. 10, 2024

Contact: [email protected]

Vanessa Roberts Avery, United States Attorney for the District of Connecticut, announced that Lyell Champagne, Jr., of St. Louis, Missouri, was sentenced today by U.S. District Judge Sarala V. Nagala in Hartford to 36 months of imprisonment, followed by three years of supervised release, for offenses stemming from two separate fraud schemes.

According to court documents and statements made in court, between approximately March 2021 and April 2022, Champagne conspired with Kristian Gupta to obtain online bank account credentials from potential victims, and then transfer money from victims' bank accounts to cryptocurrency accounts controlled by Champagne and Gupta. As part of the scheme, Gupta provided Champagne with personal identifying information of victims, and Champagne used that information to open email accounts and accounts at a cryptocurrency exchange. Champagne and Gupta attempted to recruit bank "insiders" to participate in their scheme, but were disrupted by an undercover law enforcement investigation and failed to transfer any funds from compromised accounts.

In a second scheme, Champagne filed wholly fictitious tax returns for "Shireberk International," which had no actual business operations, for the 2018 through 2021 tax years. The returns resulted in a refund of $3,449,935.

Judge Nagala ordered Champagne to pay restitution of $111,738.52. The remaining funds were recovered by law enforcement.

On June 11, 2024, Champagne pleaded guilty to one count of conspiracy to commit bank fraud and one count of filing false claims with the IRS. He has been detained since October 2022 when his bond was revoked.

On April 19, 2024, Gupta, of Port Charlotte, Florida, pleaded guilty to conspiracy to commit bank fraud. He is scheduled to be sentenced on Sept. 19, 2024.

This matter has been investigated by the Internal Revenue Service Criminal Investigation (IRS-CI) and the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorney Edward Chang.

IRS-CI is the criminal investigative arm of the IRS, responsible for conducting financial crime investigations, including tax fraud, narcotics trafficking, money-laundering, public corruption, healthcare fraud, identity theft and more. IRS-CI special agents are the only federal law enforcement agents with investigative jurisdiction over violations of the Internal Revenue Code, obtaining a more than a 90 percent federal conviction rate. The agency has 20 field offices located across the U.S. and 12 attaché posts abroad.