Bluefield Daily Telegraph, Bluefield, WV

January 7, 2014

Former mining supply businessman sentenced to federal prison for for illegal cash structuring scheme

Bluefield Daily Telegraph

BLUEFIELD — A former mining supply businessman was sentenced to federal prison after pleading guilty earlier this year to structuring thousands of dollars in bank transactions, U.S. Attorney Booth Goodwin said Tuesday.

 Michael J. Prasatek, Sr., 67, of Bluefield, was sentenced Monday to 16 months in prison, Goodwin said. The sentence was handed down by Senior United States District Court Judge David A. Faber. Prasatek, a former businessman who managed several supply companies in and around southern West Virginia since 1978, knowingly provided a coal mine operator with bogus invoices in a scheme known as “selling cash.”

During the scheme, in exchange for fake supply invoices, Goodwin said Prasatek received a check in the amount of the fictitious invoice and later deposited the money into his personal bank account. Prasatek then returned the cash to his associate for a fee.  Goodwin said Prasatek knew that the false invoice could be used for unlawful purposes such as filing a false tax deduction.

To further his scheme, Goodwin said Prasatek opened up checking accounts at two McDowell County banks using the names “Michael Prasatek DBA Prestige Paving & Sealing” and “Michael Prasatek DBA Quality Services” and routinely structured cash withdrawals.  “Structuring” involves the breaking down of cash transactions in amounts of $10,000 or less for the purpose of avoiding a financial institution’s reporting requirements to the IRS.

Prasatek admitted that beginning in May 2010 until December 20111, he structured several cash transactions totaling approximately $55,000, to intentionally avoid the mandatory financial reporting requirements, Goodwin said.

The Court also sentenced Prasatek to three years’ supervised release and ordered him to pay a $3,000 fine.

The investigation was conducted by the IRS.  Assistant United States Attorney Thomas Ryan handled the prosecution.