United States of America v. John Shannon Simpson

Columbia, SC - Former South Carolina Resident Sentenced to Federal Prison for Charity Fraud Scheme Targeting Marine Corps Families



John Shannon Simpson, age 44, of Lee County, Florida, was sentenced in federal court after pleading guilty to Wire Fraud. United States District Judge David C. Norton of Charleston sentenced Simpson to four years in federal prison and three years of supervised release to follow. This sentence will run consecutively with a nine-year state sentence that Simpson is serving in Florida. Simpson was also ordered to pay restitution of $141,709.44 to the victims of his fraud.



Evidence presented to the court established that in May 2014, Simpson founded a charitable organization entitled “Marines and Mickey” and served as the President. The purpose of the charity was to provide funds to selected United States Marines Corps (USMC) service members and their families to defray their costs of visiting the Walt Disney Resorts. The charity was also supposed to provide funds to the families of newly graduated Marines to defray the families’ costs of attending USMC boot camp graduations, including some held at Parris Island, South Carolina, and San Diego, California.



The charity claimed in its promotions and requests for money that 100% of the donations went directly to Marines and their families through the charity’s programs. The charity actively solicited donations on and near the USMC base in Parris Island, South Carolina, and elsewhere. The remainder of monies raised by the charity were a combination of private and corporate donations to the charity, including by USMC recruits and recent boot camp graduates.



While acting as the charity’s President and in support of fundraising for the charity, Simpson falsely represented himself as a retired career Marine with as much as 20 years of service, a retired Master Sergeant, a former Drill Instructor, and a Recon Marine.



In fact, Simpson spent less than five years in the Marine Corps. He entered active duty on June 28, 1993. He was absent without leave (AWOL) from June 10, 1996, to June 19, 1997. The highest rank he achieved prior to going AWOL was Lance Corporal/E-3, and his operational specialty was Basic Disbursing Clerk. Simpson was found guilty at a Special Court Martial for violation of Article 86 (Absence without leave) of the Uniform Code of Military Justice, was reduced in rank to Private/E-1, and was given a Bad-Conduct Discharge, which was effective on May 5, 1998.



By misleading donors and volunteers about his military background, Simpson was able to add credibility to his solicitations for money.



The charity was in operation from May 2014 through 2016, and it received approximately $481,000 in donations during that time-period. However, despite Simpson’s claims that 100% of the donations would go to Marines and their families through the charity’s programs, only about $90,000—or about 19% of the donations—were used for charitable purposes. Simpson diverted the remainder of the monies in the charitable accounts, approximately $391,000, for his personal use and enrichment.



The primary victim of Simpson’s scheme was the mother of a United States Marine killed in the active shooter attack at a military center in Chattanooga, Tennessee, in July 2015. Simpson fraudulently induced the Gold Star mother and others to give Simpson’s charity about $131,000, all in honor of the Gold Star mother’s son, including $75,000 of the Gold Star mother’s own money and $25,000 that the Community Foundation of Greater Chattanooga donated at the direction of the Gold Star mother.



The charity also held a fundraising benefit in New York to raise money for a Disney World trip for a Marine family whose minor daughter was terminally ill. The charity advertised all proceeds from the event would go to the minor daughter and her family for a Disney World trip, and to help pay for the family’s needs. Because the minor daughter died prior to the fundraiser, the trip intended for the minor daughter and her family, including her father who is an active duty U.S. Marine Corps Drill Sergeant, was donated to another family at the request of the minor daughter’s family. However, the charity, after paying all of the expenses of the fundraiser and sending the other Marine family to Disney World, still had about $3,200 of donations left over. Simpson kept that money for himself instead of giving it to the minor daughter’s family.



Additionally, during 2015 and 2016, Simpson made unauthorized withdrawals from the bank accounts of at least seven active-duty Marines who had recently graduated from boot camp. Simpson convinced them to allow him to make recurring withdrawals from their accounts in nominal amounts to support the charity. Instead, he used their debit card numbers to make unauthorized withdrawals from their accounts in a combined total amount of more than $5,000.



The case was investigated by agents of the Federal Bureau of Investigation (FBI) and Naval Criminal Investigative Service (NCIS).

Charge:

FRAUD BY WIRE, RADIO, OR TELEVISION - knowingly did devise and intend to devise a scheme and artifice to defraud, and to obtain money and property by means of materially false and fraudulent pretenses, representations, and promises. Subject to forfeiture allegations pursuant to Title 18, United States Code, Section 981(a)(1)(C), and Title 28, United States Code, Section 2461(c).

(1)

The defendant is hereby committed to the custody of the Federal Bureau of Prisons to be imprisoned for a total term of FORTY-EIGHT (48) months; said term to run consecutive to the sentence received in Florida 20th Circuit Court, Dkt. No. 17-CF-14247. The defendant shall pay the mandatory $100.00 special assessment fee and $141,707.44 in restitution, both due immediately. The defendant is remanded to the custody of the United States Marshal. Upon release from imprisonment, the defendant shall be on supervised release for a term of three (3) years. While on supervised release, the defendant shall comply with the mandatory and standard conditions of supervision and the following special conditions: 1. The defendant shall pay any remaining restitution at a rate of no less than $100 per month, beginning within 30 days of release. The payments shall be made payable to "Clerk, U.S. District Court" and mailed to PO Box 835, Charleston, SC 29402. Interest on any restitution ordered as to this defendant is waived. Payments shall be adjusted accordingly, based upon the defendant's ability to pay as determined by the Court. 2. The defendant shall be subject to placement in the Financial Litigation Unit Wage Garnishment program for the purpose of collecting restitution, if deemed necessary by the U.S. Probation Officer. 3. The defendant shall provide the U.S. Probation Officer access to any and all requested financial information, including but not limited to income tax returns. 4. The defendant shall be prohibited from opening any new lines of credit without the prior written approval of the U.S. Probation Officer. 5. The defendant shall participate in a program of mental health counseling and/or treatment as deemed necessary by the U.S. Probation Officer, until such time as the defendant's release from the program is approved by the U.S. Probation Officer.