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ORIGINAL STORY: A Park Ridge con man admitted Wednesday that he used shell companies and bogus invoices to scam an international company he worked for and Toys R Us, where his now-deceased ex-wife had worked, out of $3 million.
Philip Charles de Gruchy, 64, was married at the time to Barbara Brown, an administrator with Toys R Us in Wayne who authorities said steered a contract to CEM Direct Marketing — a fictitious company created by the couple.
From November 2007 through early March 2010, CEM submitted more than 60 invoices for purported consulting work that the then-married couple “either copied from other vendors’ work, was related to other businesses or did not correspond to items on CEM’s invoices,” according to an FBI complaint on file in U.S. District Court in Newark.
CEM had TRU mail checks to various Canadian addresses before they were ultimately deposited at bank branches in Park Ridge.
Checks were then written out of the CEM account payable directly to either de Gruchy or Brown or to Silk Farm and Ontario LLC, companies affiliated with de Gruchy, the federal complaint says.
“Money obtained from the scheme was used for personal purposes, including home renovations, mortgage payments on the Park Ridge residence that Brown and de Gruchy shared, and credit card expenses,” U.S. Craig Carpenito said.
For 16 months, beginning in July 2010, deGruchy worked for Tumi Luggage in South Plainfield as director of global relations management. While there, he hired Brown for a project without disclosing their relationship, federal authorities said.
From Nov. 4, 2010, through Sept. 22, 2011, the company mailed $216,835 in checks to a Canadian address purporting to belong to Brown or BI Insights, an alleged Canadian company engaged in marketing consulting services and controlled by Brown, the FBI complaint says.
De Gruchy approved all of the invoices, even though “no meaningful work product was furnished,” it says.
“Additional invoices submitted by Brown to [Tumi] totaling $124,150, were not paid after the scheme to defraud was uncovered,” the complaint says.
After discovering that CEM’s website was registered to Brown’s home address, Toys R Us filed suit in Superior Court in Hackensack — and the government investigated.
Brown died last May.
De Gruchy pleaded guilty in U.S. District Court in Newark on Wednesday to conspiracy to commit mail fraud and subscribing to false individual and corporate tax returns
He admitted filing false federal tax returns for the calendar years 2009 and 2010, "in which he knowingly overstated expenses and understated gross receipts, including receipts from the fraudulent conduct," Carpenito said.
He also admitted doing the same those same years for two of the sham companies, falsely claiming certain payments as business expenses.
In total, Carpenito said, De Grucy owes $882,844 in back taxes.
Sentencing is scheduled for July 9.
Carpenito credited special agents of the FBI and IRS-Criminal Investigation for the investigation.
Senior Litigation Counsel Leslie F. Schwartz of Carpenito's Special Prosecutions Division in Newark is handling the case for the government.
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