Lake Michigan Carferry’s former financial controller was sentenced to 63 months in prison for stealing more than $1.7 million from the company over 11 years.
Paul Patrick Piper, of Ludington, was sentenced last week on charges of bank fraud and filing a false federal income tax return.
The sentencing hearing took place in the U.S. District Court in Grand Rapids before Chief U.S. District Judge Robert J. Jonker. In imposing the sentence, Jonker said the amount Piper embezzled over many years was “a frightening number that caused substantial financial hardship” to the Lake Michigan Carferry and resulted from a “pattern of conduct that needs deterrence.”
“Mr. Piper earned his sentence,” U.S. Attorney Andrew Birge said. “His greed caused significant financial damage to one of the largest employers in the Ludington area. Vigorous prosecution of white-collar crime and enforcement of our country’s tax laws remains an important priority in my office.”
Piper served for many years as the financial controller for Lake Michigan Carferry, the company operating the S.S. Badger ferry between Ludington and Manitowoc, Wisconsin. Piper embezzled over $1.7 million between 2007 and May 2018 by overriding normal company accounting systems and writing checks directly to himself and to two of his affiliated businesses, Piper Tax & Accounting and Piper Group.
Piper either forged the signatures of company owners on these checks or used a signature stamp without the authorization of the owners. Piper hid these transactions in the accounting system by booking these checks to an insurance expense code and by otherwise making false entries to balance company accounts.
Additionally, Piper filed false personal income tax returns with the Internal Revenue Service because he knowingly failed to include the income he stole from the Carferry and other income earned from his tax business on his federal income tax returns.
“Piper violated the trust of the company that hired him and endangered the financial well-being of one of Ludington’s largest employers,” said Steven D’Antuono, special agent in charge of the Federal Bureau of Investigation in Michigan. “Financial crime is not a victimless crime. The FBI and our law enforcement partners will continue to pursue anyone who uses their position of trust for personal gain.”
As part of Piper’s sentence, the court imposed a forfeiture money judgment in the amount of $1,740,037.91. Pursuant to prior forfeiture efforts, Piper forfeited a 2018 Ram Truck, a 2008 Glacier Bay fifth wheel recreational vehicle and cash in lieu of forfeiture of other assets.
The court will impose mandatory restitution for the victim in an amount of at least $1,740,037.91 after receiving information and arguments from the parties about possible additional losses within the next 30 days.
Assistant U.S. Attorney Ronald Stella conducted the prosecution of the case. The IRS Criminal Investigation Division and the FBI, with significant assistance from the Mason County Sheriff’s Office, handled the investigation of the case.