DOJ sentenced NJ-based scrap dealer to prison

The U.S. Department of Justice (DOJ) has announced the sentencing of Craig Cinelli, a minority owner of the Secaucus, New Jersey-based metals recycling company Cinelli Iron & Metal Co. (CIMCO), to 33 months in prison for operating a 17-year conspiracy that defrauded customers out of millions of dollars. 

Cinelli had previously pleaded guilty to one count of an indictment charging him with conspiracy to commit wire fraud. David Barteck, the former chief financial officer of CIMCO, and Michael A. Valenti III, the former senior vice president of sales at CIMCO, each previously pleaded guilty and are awaiting sentencing.

According to documents filed in this case and statements made in court, various members of CIMCO, which operated three scrap metal yards in New Jersey, had, from 1999 through March of 2016, allegedly used a variety of fraudulent business practices to buy scrap metal from CIMCO’s customers for less than CIMCO should have paid. The company then resold the scrap metal at a profit.

Instead of paying the proper, agreed-upon amounts for the actual weight, members of the conspiracy used a variety of techniques to misrepresent the true weight and type of the scrap metal, including altering documents to reflect a lower weight, removing scrap metal from a haul before it was weighed and misrepresenting the types of scrap metal contained in a haul, the DOJ reports. Cinelli admitted that the loss caused by the conspiracy that was reasonably foreseeable to him was more than $9.5 million, but less than $25 million.

In addition to the prison term, the judge in the case sentenced Cinelli to three years of supervised release. Restitution will be determined later.