A 39-year-old Las Vegas man previously convicted of practicing medicine without a license pleaded guilty Thursday to a federal charge in connection with his defrauding Citibank and credit card companies of $3.9 million.
Andrew Michael; his wife, Bernadette Pagan, 37; and his mother, Phyllis Ries, 76, were indicted in August 2006, accused of working together to use false financial information, bank references and independent audit reports to apply for an $8.5 million credit line with Citibank. The false financial information caused Citibank to issue three Diners Club Corporate Cards to Michael, his wife and his mother, according to federal prosecutors.
Michael later attempted to increase the credit line to $20 million, a news release said.
His plea of guilty to the charge of making a false statement on a credit application was part of a group plea agreement under which federal prosecutors agreed to recommend that Michael’s mother be placed on pretrial diversion and under which his wife will plead guilty to aiding and abetting the false statement in the credit application.
According to the plea, about $3.9 million in restitution is owed to Citibank, Bank of America and several credit card processing companies. Some of Michael’s assets were seized from his home, including $24,000 in cash, 170 troy ounces of silver, 479 tubes of gold flakes, a Rolex watch and several funds in investment accounts.
When Michael committed the credit fraud, he was on probation for being convicted of practicing medicine without a license. He operated a Henderson medical office, where he supervised medical procedures and offered medical advice.
On December 29, 2005, he had submitted the fraudulent credit application identifying himself as California Holding Company Inc.’s senior vice president of mergers and acquisitions and supplied documents indicating that the company had nearly $1 billion in assets and $165 million in yearly revenue. He also represented that the company maintained several bank accounts in Beverly Hills, Calif., and he submitted the report of an independent auditor to attest to the accuracy of the financial information he had provided. He also provided a Web site for the company that listed Michael as vice president of mergers and acquisitions.
On June 28, 2005, a Citibank investigator became aware of the suspected fraud and notified the U.S. Secret Service. Investigators determined the Web site had been pirated from one owned by a legitimate publicly traded billion-dollar company.
Account histories for the corporate credit cards showed that more than $2 million had been charged to the accounts for Michael, Pagan and Ries’ personal expenses.
Michael was arrested in July 2006 and has remained in federal custody since then.
He is to be sentenced April 16.
Contact reporter Antonio Planas at email@example.com or (702) 383-4638.