USA v. Applebury et al

District of Alaska, akd-3:2017-cr-00121-58433


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BRYAN SCHRODER United States Attorney RETTA-RAE RANDALL Assistant United States Attorney Federal Building & U.S. Courthouse 222 West Seventh Avenue, #9, Room 253 Anchorage, Alaska 99513-7567 Phone: (907) 271-5071 Fax: (907) 271-1500 Email: IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ALASKA UNITED STATES OF AMERICA,) Case No. 3:17-cr-00121-TMB) Plaintiff,) DECLARATION OF) AUSA RETTA-RAE RANDALL vs.) IN SUPPORT OF MOTION FOR) ORDER TO SHOW CAUSE JILL DIANE APPLEBURY,) aka: "Jill Wetzsteon,") [Filed on Shortened Time]) Defendant.)) I, Retta-Rae Randall, declare and state as follows: 1. I am an Assistant United States Attorney for the District Alaska, and am assigned to the above captioned matter. As such, I am fully familiar with the facts stated herein. I make this declaration, pursuant to 28 U.S.C. § 1746, in support of the United States' motion for a bail hearing in this matter, and for the defendant to show cause why her release order should not be rescinded and for other relief the Court deems necessary and proper. 2. Defendant Jill Applebury (hereinafter "Defendant") has been on conditions of release ordered by this court since the arraignment on the indictment in this case (Doc. 2) continuing through her arraignment on the superseding indictment (Doc. 144). At the conclusion of her change of plea hearing on November 27, 2018, defendant was advised by District Court Judge Timothy Burgess that all of the conditions of her release remained in effect as previously set. See Docket 285. THE CHARGES TO WHICH THE DEFENDANT HAS ADMITTED GUILT 3. On November 27, 2018, Defendant entered guilty pleas to Count 2: Bank Fraud, in violation of 18 U.S.C. § 1344(2), Count 18: Bank Fraud, in violation of 18 U.S.C. § 1344(2), Count 19: Bank Fraud, in violation of 18 U.S.C. § 1344(2), Count 20: Bank Fraud, in violation of 18 U.S.C. § 1344(2), Count 33: Wire Fraud, in violation of 18 U.S.C. § 13434, and Count 52: Fraudulent Transactions with an Access Device, in violation of 18 U.S.C. § 1029(a)(5), (c)(1)(A)(ii), of the First Superseding Indictment. Sentencing is scheduled for March 29, 2019. See Docket 281, 285. CURRENT CONDUCT 4. On January 2, 2019, undersigned counsel received a telephone call from a relative of Defendant's inquiring how Defendant was able to return to Montana over the recent Christmas holidays. The court may recall that at a continued bail hearing held on September 4, 2018, concerns were raised by the family about Defendant's access to the U.S. v. Jill Applebury Page 2 of 8 3:17-cr-00121-TMB-DMS Rocky Knob Lodge (Lodge) and the Lazy J Cross Ranch's (Ranch) financial accounts. Those are properties in Montana which are owned by Defendant's mother. 5. At the end of the bail hearing on September 4, 2018, after the court addressed its concerns about the financial affidavits previously filed by Defendant, the court denied "the request to go to Montana and … renewed Judge Hutton's order that [the defendant] remain in Anchorage and obtain employment". Exhibit 5 at 87. Defendant then allegedly had to deal with an emergency situation which required her presence in Montana from December 15 through December 26. Defendant returned to Anchorage on December 31, 2018. 6. Prior to the charges filed in this case, when Defendant was in Montana, she voluntarily "managed" the Lodge; she was never an employee. After the Indictments in the case and subsequent bail hearings, the family looked more closely at the bank records for the Lodge and discovered that during the duration of her "management" of the Lodge, Defendant had made personal use of the Lodge's bank accounts without the family's knowledge. The Lodge was closed on June 26, 2018. The sale of the Lodge is pending; the closing date is scheduled for mid-January. 7. The following information, both historical and current, was recently provided by family members: // U.S. v. Jill Applebury Page 3 of 8 3:17-cr-00121-TMB-DMS DEFENDANT EMPTIED THE ROCKY KNOB LODGE BANK ACCOUNT, DRAWING ON THE FUNDS EVEN AFTER SHE WAS TERMINATED FROM THE LODGE On June 26, 2018, Defendant wrote herself a check on Rocky Knob Lodge account for $4985.20, claiming on the memo line that the payment was for "Costco reimbursement". The Lodge had a credit card and there was no reason for such a personal reimbursement to Defendant. See Exhibit 1. On June 27, 2018, a letter was sent to Defendant via email, regular mail, and certified mail from the attorney representing the Defendant's mother; the letter was a notice terminating Defendant as Manager and Officer of Rocky Knob Lodge, Inc. See Exhibit 2. The email was delivered; the letter sent via certified mail was refused and was returned. Id. On June 28, 2018, Defendant wrote herself another check on Rocky Knob Lodge account for $1906.00, leaving $.04 in the account. The memo line stated "reimb. expenses." See Exhibit 1. The account was basically emptied. DEFENDANT THEN STOLE AN INSURANCE CHECK PERTAINING TO THE ROCKY KNOB LODGE On October 26, 2018, a check was issued by The Cincinnati Specialty Underwriters Insurance Company to Rocky Knob Inc., dba Rocky Knob Lodge, for $1615.56 for fire damage at the Lodge. The check was deposited by one of the owners of the Lodge into the bank account and used to pay bills for the Lodge pending sale of the U.S. v. Jill Applebury Page 4 of 8 3:17-cr-00121-TMB-DMS Lodge in January, 2019. 1 One of those checks was to the State of Montana for taxes. The owners had received no previous notice about any fire and subsequently learned about the fire at the Lodge from an employee. The checks issued to pay those bills for the Lodge out of the $1615.56 subsequently bounced. Inquiries to the insurance company by the family revealed that Defendant had requested a stop payment on the check and asked that it be re-issued to her. The owners did not receive notification of the Stop Payment on the check until December 11, 2018. See Exhibit 3. In the meantime, on November 13, 2018, Defendant had endorsed the re-issued insurance check without authority and without notifying any of the owners of the Lodge; 2 it appears that she deposited it into a Wells Fargo account. RECENT VISIT BY DEFENDANT TO MONTANA The Lodge was closed on June 27, 2018, by the attorney representing the mother of Defendant. Point of Sale (POS) equipment was located in the Lodge and was a negotiated part of the sale of the Lodge to the new owners. The real estate agent had visited the Lodge during a routine check on Friday, December 21, 2018, and the POS equipment was in the Lodge. Sometime after that visit, Friday evening or Saturday 1 When the Rocky Knob Lodge Restaurant was closed in June 2018, Defendant had taken all of the money left over; as a result there was no money left to pay vendors, cover payroll, pay insurance, etc. Defendant also drained the Bitterroot Credit Union and Wells Fargo accounts for the Lodge. 2 One can compare the signatures on these checks with the signatures on the Conditions of Release signed by Defendant. See Dockets 52 and 158. Family members have also identified the endorsements on the checks as the signatures of Defendant. U.S. v. Jill Applebury Page 5 of 8 3:17-cr-00121-TMB-DMS morning, the agent received word that the Defendant was in Montana. On Saturday, December 22, 2018, the agent returned to the Lodge to check on things again and the POS system was gone as well as other personal items from a bedroom and the office. A text message exchange on December 27, 2018, between the defendant and her mother showed the following: At 7:36 a.m. Defendant wrote to her mother: "Did Lavu 3 send a box to have the pos returned? It was being paid for monthly and I stopped paying for the fees in July. The Ipad was part of the system. I can show you the last payment I made for it and it was on my personal credit card. Has there been any news on the sale?" At 10:00 a.m, Mother responded to Defendant: "The buyers want to take the pos over…and that's why we need it back. This was going to effect the sale. Can you take all of the pos, iPad, and the computer back to Bob Fifield's Office? … Let me know when you return all of the pos equipment." The POS system has yet to be returned. Defendant did not respond to her mother's text. GPS monitoring of the Defendant showed that she was not at the Lodge's location at the time in question. However, two former employees of the Lodge have access to the closed Lodge and would likely give the Defendant access to the Lodge. The investigation into the POS is ongoing. // 3 Lavu is a point of sale system for small businesses. U.S. v. Jill Applebury Page 6 of 8 3:17-cr-00121-TMB-DMS DEFENDANT'S FAMILY DOES NOT WANT THE DEFENDANT RETURNING TO MONTANA 8. The family does not want the Defendant to be able to return to Montana, specifically, the Defendant should not be able to return to the Lodge or the Ranch. When she is there, "things go missing." The Defendant is upset about the sale of the Lodge, and she wants ownership of the family Ranch. The Defendant is now claiming that she has a loan against the Ranch, a loan about which no one in the family was aware. The family is also concerned about the Defendant, having filed tax returns for the family in the past, having access to all of the personal identifying information of her mother and sisters. DEFENDANT'S CONDITIONS OF PRETRIAL RELEASE & ACKNOWLEDGMENT OF THE SAME 9. At a minimum, it appears clear that Defendant has violated at least one of her release conditions: (1) The defendant must not violate federal, state, or local law while on release. (Docket 158 at 1.) 10. Two different United States Magistrate Judges have been very clear and specific in court hearings and in their release orders, and emphasized to Defendant that the onus is on her to make sure that she abides by the conditions of her release and that she bring any questions in that regard to USPO before proceeding. These orders appear to have been violated. Accordingly, the United States asks that the Court hold a hearing for Defendant to show cause why her bail should not be revoked, as well as any other relief the Court deems necessary and proper. An agent from the FBI will be present to U.S. v. Jill Applebury Page 7 of 8 3:17-cr-00121-TMB-DMS detail knowledge of the facts set forth herein. Pursuant to 28 U.S.C. § 1746, I declare under penalty of perjury that the foregoing is true and correct to the best of my knowledge and belief. Executed on January 10, 2018. RESPECTFULLY SUBMITTED January 11, 2018, at Anchorage, Alaska. BRYAN SCHRODER United States Attorney s/ Retta-Rae Randall RETTA-RAE RANDALL Assistant United States Attorney United States of America CERTIFICATE OF SERVICE I hereby certify that on the filing date a copy of the foregoing is being served electronically, via the Court,s CM/ECF system, on: James A. Wendt, Esq. s/ Retta-Rae Randall Assistant United States Attorney U.S. v. Jill Applebury Page 8 of 8 3:17-cr-00121-TMB-DMS