UPDATED: 2nd Salisbury Man Sentenced for Conspiracy & Identity Theft
UPDATED – 10/26/23 – A Salisbury man has been sentenced to over 30 months in federal prison for wire fraud conspiracy and aggravated identity theft. A U-S District Court Judge Thursday sentenced 48 year old Duane Larmore in connection with the theft of over $1.8-million fro Shore Appliance Connection, where he was employed. Larmore was also ordered to pay restitution to the full amount of the victims’ losses – which is over $1.8-million.
According to his plea agreement, from mid-September 2016 through about March 2020, Larmore conspired with others to steal more than $1.8 million from a Salisbury, Maryland company, Shore Appliance Connection, owned and operated by Owner #1 and Owner #2, that sold household appliances as well as mattresses and bedding. Larmore was an employee at Shore Appliance whose duties included maintaining the books and records for the company.Â
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ORIGINAL STORY – 09/08/23 – A Salisbury man has been sentenced to 66 months in federal prison for a wire fraud conspiracy and aggravated identity theft in connection with the theft of over $1.8-million from Shore Appliance Connection. US District Judge Deborah Chasanow sentenced 54 year old Stephen Franklin Thursday – and ordered that he pay restitution in the full amount of the victims’ losses. Franklin was the COO of Accurate Optical and met co-defendant 48 year old Duane Larmore of Salisbury through the Salisbury Chamber of Commerce. Larmore was an employee at Shore Appliance. From September of 2016 through March 2020, Franklin conspired with others – including Larmore – to steal more than $1.8-million from Shore Appliance. Larmore previously pleaded guilty to his role in the conspiracy and is awaiting sentencing.
Additional information from the US Attorney for the District of Maryland:
Specifically, Franklin and Larmore stole over $1 million from Shore Appliance to use for their own purposes, including to make investments and to pay business expenses for Franklin’s businesses, without the knowledge and consent of the owners of Shore Appliance. For example, Franklin convinced Larmore to invest $100,000 in an oil deal that promised quick and substantial returns. Those funds were ultimately returned to Shore Appliance because the name on the bank account did not match the named beneficiary on the wire transfer form completed by Franklin. Prior to the funds being returned and at Franklin’s urging, Larmore transferred another $100,000 to a purported attorney for the oil deal. Franklin also convinced Larmore to invest in other deals, including: in 2016, a $95,000 initial investment with a finance company in London, U.K., followed by another $300,000, plus funds for expenses and travel abroad; in 2018, an investment through W.S. of $35,000 and an investment through Gateway Capital of $50,000; and in 2019 – 2020, investments and expenses through I.P. and E. P.-S. to recover assets purportedly in the custody of U.S. Customs, part of the Department of Homeland Security. No investment paid any return to the schemers.
To conceal how much money had been removed from Shore Appliance and to obtain cash to invest, Franklin suggested that Larmore enter into factoring contracts. Franklin had experience with borrowing operating funds for his optical companies from factors and provided Larmore with the names and contact information for factoring companies. Factoring is a means by which businesses can obtain cash quickly by leveraging accounts receivable. With Franklin’s encouragement, Larmore applied for a factoring contract for Shore Appliance without the knowledge or approval of the owners, corporate directors, or officers of Shore Appliance. As detailed in the plea agreement, the factoring contracts provided cash deposits to Shore Appliance’s bank accounts but encumbered the accounts receivable of Shore Appliance and required payments and interest of more than $725,000.
To obtain contracts with factoring companies for Shore Appliance and to conceal the fact that the Shore Appliance owners were not aware of and had not approved the factoring contracts, the signatures of the owners were forged, and the fraudulent signatures were witnessed or notarized by Franklin. Further, Larmore and a female employee of Franklin’s posed as the owners in telephone conversations with representatives of the factoring companies to confirm their approval of the factoring contracts. In addition, to conceal Larmore’s embezzlements and the factoring agreements, Larmore caused Shore Appliance to draw on Shore Appliance’s lines of credit with two separate financial institutions to obtain another $200,000 in cash. As of March 2020, Shore Appliance still owed $208,394.92 in principal and interest on these lines of credit.
Finally, when Franklin’s business began having financial difficulties, at Franklin’s request, Larmore provided funds to Franklin to pay rent and employee salaries for the businesses, to rent a storage facility and to hire trucks to move equipment and office furniture when Accurate Optical was evicted from its Salisbury, Maryland office in July 2019. All the while, Franklin continued to suggest that Larmore put money into other investment schemes, which Larmore did.
In all, Larmore paid $739,295.28 of Shore Appliance’s funds, without the officers and owners’ knowledge or consent, to invest in fraudulent schemes that never paid any money back. Of that amount, $395,000 was moved through bank accounts controlled by Franklin. Franklin caused an additional loss of $171,548.67 by having Larmore transfer funds to Franklin or to Franklin’s companies. As a result of the conspiracy and efforts to conceal the losses, Shore Appliance lost an additional $731,250.07 in fees and other payments to factors and to factoring brokers. Shore appliance also paid interest of $208,395 from Larmore drawing on its bank lines of credit. For all of Franklin’s and Larmore’s conduct, actual cash losses to Shore Appliance totaled $1,850,488.94 and intended losses totaled $2,137,674.74.
United States Attorney Erek L. Barron commended the FBI for its work in the investigation. Mr. Barron thanked Assistant U.S. Attorney Evelyn Lombardo Cusson, who is prosecuting the case.
ADDITIONAL STORIES –
08/25/21 – Two Salisbury Men Indicted for Federal Conspiracy & Other Offenses
05/06/22 – Salisbury Man Pleads Guilty to Wire Fraud Conspiracy & Aggravated Identity Theft
05/09/23 – Salisbury Man Pleads Guilty to Stealing Over $1.8-million from Salisbury Business
