Law360 is providing free access to its coronavirus coverage to make sure all members of the legal community have accurate information in this time of uncertainty and change. Use the form below to sign up for any of our weekly newsletters. Signing up for any of our section newsletters will opt you in to the weekly Coronavirus briefing.
Sign up for our White Collar newsletter
You must correct or enter the following before you can sign up:
Thank You!
Law360 (April 15, 2020, 3:05 PM EDT ) A former hospitality executive incarcerated for stealing nearly $14 million from his previous employer and evading taxes on almost $28 million in income won his bid to get out of jail due to COVID-19 fears, according to a letter filed Tuesday in New Jersey federal court.
The Bureau of Prisons granted George Dfouni's request to serve the remaining five months of his sentence, stemming from wire fraud and tax evasion charges, on home confinement, Assistant Federal Public Defender Peter M. Carter wrote to U.S. District Judge Katherine S. Hayden. Carter asked to suspend Dfouni's release motion pending his move to dismiss it.
"He has begun a 14-day quarantine in prison, and is scheduled to be released to home confinement at the end of this. Once he is released to home confinement, he will move to dismiss this motion," Carter's letter read.
In his motion to escape what he considered an inevitable "death sentence," the 49-year-old Dfouni had argued that he's particularly vulnerable to the coronavirus because he suffers from hypertension, tuberculosis and methicillin-resistant Staphylococcus aureus, or MRSA, and recently had back surgery.
Dfouni went on to claim that the Lewisburg, Pennsylvania, penitentiary where he's serving his time was ill-equipped to contain the spread of the coronavirus.
The former chief operating officer of a New York-based hospitality company, Dfouni was originally going to be released in April 2021. However, the court had reduced his sentence to home confinement after he completed a drug abuse treatment program and gave him a new release date of September.
According to the government's case, Dfouni worked for the hospitality business, which owns and operates hotels in New York and New Jersey, from 1996 to 2015. The company was not identified in court records.
Starting in 2007, Dfouni negotiated contracts on the company's behalf with two other businesses that leased New York hotel properties from his then-employer, prosecutors said. Dfouni arranged for the other businesses to send their payments directly to him, and each contract included a signing bonus for him, prosecutors said.
While he was expected to keep his signing bonus and turn over the remaining dollars to his then-employer, Dfouni pocketed a portion of the money owed to the company to support his gambling expenses and lavish lifestyle, prosecutors said. He embezzled a total of $13.8 million from the business, prosecutors said.
Prosecutors also alleged Dfouni failed to report roughly $27.7 million in income to the Internal Revenue Service between 2007 and 2014.
Dfouni pled guilty and was sentenced in October 2018 to 46 months in prison.
Matthew Reilly, a spokesperson for the U.S. Attorney's Office for the District of New Jersey, declined to comment.
Dfouni's public defender didn't immediately respond to a request for comment.
The government is represented by Anthony Moscato of the U.S. Attorney's Office for the District of New Jersey.
Dfouni is represented by Peter M. Carter of the Office of the Federal Public Defender for the District of New Jersey.
The case is U.S. v. Dfouni, case number 2:18-cr-00028, in the U.S. District Court for the District of New Jersey.
--Additional reporting by Bill Wichert. Editing by John Campbell.
For a reprint of this article, please contact reprints@law360.com.
