Source: Office of United States Attorneys
NEWARK, N.J. – Pantaleo “Leo” Pellegrini, the former Hoboken Director of Health and Human Services and Director of the Department of Environmental Services, was sentenced to 24 months in prison for embezzling money from the City of Hoboken and filing a false tax return, U.S. Attorney Alina Habba announced
Pellegrini previously pleaded guilty to embezzlement and filing a false tax return before U.S. District Judge Michael E. Farbiarz in Newark federal court.
According to documents filed in this case and statements made in court:
While working for the City of Hoboken, Pellegrini embezzled money from the City of Hoboken by diverting approximately $223,500 in payments intended for the City of Hoboken to bank accounts he controlled. Pellegrini also embezzled money from the City of Hoboken by submitting approximately $234,432.60 in his personal expenses, which the City of Hoboken unknowingly paid. Additionally, Pellegrini did not report the embezzled money on his personal tax returns, and thereby made and subscribed a false personal tax return and avoided approximately $119,972.60 in taxes due.
Pellegrini’s oversight responsibilities related to certain public recreational facilities, including soccer fields that could be reserved by both Hoboken and non-Hoboken residents for a fee paid to the City of Hoboken. Through this arrangement, the City of Hoboken Department of Parks, Recreation & Public Works sponsored a non-profit recreation soccer league open to Hoboken youth (the “Youth Soccer League”), which was funded by the City of Hoboken and participant fees. Also during the charged time period, an adult soccer league open to Hoboken and non-Hoboken residents (the “Adult Soccer League”) was in operation, which was funded from participant fees.
Pellegrini developed a scheme to divert the Adult Soccer League’s participant fee payments intended for the City of Hoboken to a business account on which he was a signatory which was registered to a soccer-related entity linked to him.
During the relevant time period, Pellegrini was also the Owner and President of a private travel soccer club. Pellegrini also submitted or caused the submission to the City of Hoboken invoices associated with his private soccer club, which Pellegrini falsely or fraudulently represented to the City of Hoboken as invoices eligible for reimbursement by the City of Hoboken. As a result, the City of Hoboken—at Pellegrini’s direction—unknowingly paid tens of thousands of dollars to the Pellegrini’s private soccer club vendors for its expenses, and also unknowingly paid tens of thousands of dollars directly to Pellegrini through his private soccer club.
Pellegrini used the embezzled funds on personal expenses including meals, entertainment, and gambling, allowing him to live far beyond his means. Moreover, Pellegrini intentionally did not disclose and report the income from the above-described embezzlement scheme, thereby causing his tax returns to understate a substantial amount of the income he received.
In addition to the prison term, Judge Farbiarz ordered restitution of $439,972.60 to the City of Hoboken, restitution of $119,464 to the Internal Revenue Service, and forfeiture of $439,972.60. Judge Farbiarz also ordered a term of supervised release.
U.S. Attorney Habba credited special agents of the FBI, under the direction of Acting Special Agent in Charge Terence G. Reilly in Newark and special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Jenifer L. Piovesan in Newark, with the investigation leading to the sentencing.
The government is represented by Assistant U.S. Attorneys Mark J. McCarren and Matthew Specht of the Special Prosecutions Division.
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Defense Counsel:
John D. Lynch, Esq., Union City, NJ