D.A. Bragg Announces Indictment In Sprawling $76M Fraud

Six Defendants, Two Companies Allegedly Fabricated Companies to Steal from Commercial Funders

Manhattan District Attorney Alvin L. Bragg, Jr., today announced the indictment of six defendants and two corporations - SILVER BIRCH SYSTEMS and TELEESCROW - for conspiring to create and use fabricated companies to defraud commercial lenders of more than $76.4 million between May 2019 and July 2022. The defendants are charged in a New York State Supreme Court indictment with multiple counts of Grand Larceny in the First Degree, Scheme to Defraud in the First Degree, and Conspiracy in the Fourth Degree, among other charges. [1]

"As alleged, these defendants worked together to orchestrate an elaborate fraud, disguising their theft with layers of falsified paperwork and fabricated companies," said District Attorney Bragg. "In total, we allege, this complex scheme defrauded commercial funders of more than $76 million. I thank my office's prosecutors and all of our law enforcement partners for their work leading to today's indictment."

As alleged in court documents and statements made on the record, the defendants created SILVER BIRCH, a purported telecommunications company, which claimed to generate revenue by purchasing, reselling, and routing voice over internet protocol (VoIP) minutes. DANIEL OSHATZ, 59, a former attorney, served as the Chief Executive Officer; TRISTAN NAPOLEON DESECHENES MARTINEZ, 45, a television and film director in the Dominican Republic, functioned as the Director of Finance; and JONATHAN DEUTSCH, 59, managed the books and accounting.

In order to create and conceal the illusion of SILVER BIRCH's revenue, the defendants allegedly created numerous telecommunications companies to pose as SILVER BIRCH's vendors and customers. They also created TELEESCROW, a purported third-party escrow company based in Manhattan, to act as their 'bank.' EILLIEN LORENA CABRERA DE LANDESTOY, 44, served as TELEESCROW's Chief Executive Officer; ALFREDO DOMINGO PATNELLA TEZANOS, 51, a software engineer, created and managed TELEESCROW's digital infrastructure; DESECHENES MARTINEZ served as Chairman of the Board, and DEUTSCH executed wire transfers from TELEESCROW's bank account at Manhattan-based Metropolitan Commercial Bank.

Using numerous fabricated companies and this purported escrow company, the defendants allegedly made false representations about SILVER BIRCH's business, revenue, and assets to six commercial funders in order to steal more than $76 million. BENJAMIN KOIFMAN, 51, a commercial funding broker operating in the New York area, allegedly facilitated several of these agreements. The defendants also allegedly defrauded an additional five commercial funders during the same period using these fabricated companies and misrepresentations.

One of the methods of commercial funding involved "factoring," where funders bought SILVER BIRCH's pending invoices, advancing SILVER BIRCH the money it was 'owed' for a fee. The defendants then allegedly coordinated the transfer of millions of dollars of stolen funds through a network of bank accounts to pay funders under the guise that SILVER BIRCH's customers were paying the invoices they 'owed' to SILVER BIRCH. Funders filed lawsuits when they observed SILVER BIRCH was not making payments, and during the pendency of the lawsuits, the defendants allegedly created new versions of SILVER BIRCH and TELEESCROW to pay funders and continue the alleged conspiracy through July 2022.

Assistant D.A.s James Vicchairelli, Thomas Reilly and Christne Payne (Deputy Chief of the Major Economic Crimes Bureau) are handling the prosecution of this case under the supervision of Assistant D.A.s Michael Ohm (Chief of MECB), and Judy Salwen (Deputy Chief of the Investigation Division) and Executive Assistant D.A. Jodie Kane (Chief of the Investigation Division).

Senior Financial Investigator William Martin, Senior Investigator Alexandra Cinque, and Lieutenant Brian Conway assisted with the investigation, as did Information Technology Technical eDiscovery Analyst Roshard Nicholls and Analyst Kelly Reynolds; High Tech Analysis Unit Cyber Response Investigator Marko Papic, Supervising Cyber Response Investigator Lawrence Hayes, and Chief Douglas Daus; Privilege Review Unit Senior Counsel Beth Potashnick and Chief Caroline Serino; and Language Services Unit Spanish Interpreters Ivan Araque and Katherine Cardenas, and Supervisor Martha Mendoza. MECB Investigative Staff including Rosalind October, Evan Akers, Georgia Longstreet Joseph, Nelson Rogers, Allan Riksphun, Keren Appelbaum, Alexis Nieves, Arlinda Xhuveli, as well as former staff and Assistant D.A. John Cheever, provided valuable support.

D.A. Bragg thanked the members of the Serious Fraud Office in the U.K. for their assistance in the course of their parallel investigation. D.A. Bragg also thanked the U.S. Department of Justice, the U.S. Marshals Service, the City of London Police, and His Majesty's Revenue & Customs, and for their assistance with the investigation.

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[1] The charges contained in the indictment are merely allegations and the defendants are presumed innocent unless and until proven guilty. All factual recitations are derived from documents filed in court and statements made on the record in court.