Assistant U.S. Attorneys Michael DiGiacomo and Brian J. Counihan, who handled the prosecution of the case, stated between January 2008 and December 2010, the defendant, a practicing attorney at the time, devised a scheme to defraud investors out of approximately $3,400,000.

As part of the scheme, MacCallum encouraged some victims to liquidate other investments in order to benefit from his false and fraudulent higher rates of return. The defendant claimed that his investments were secured by real estate and life insurance policies. However, the Government’s evidence demonstrated that the defendant was using victim investments to pay back earlier investors and to pay personal and other expenses such as personal travel and office expenses. MacCallum received $3,423,737.00 from victim investors.

The verdict is the result of investigation by the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Adam S. Cohen.

Following today’s verdict, Judge Elizabeth A. Wolford, who presided over the trial, order the defendant detained pending sentencing on July 11, 2017.

(Image from WIVB)

(MEDIA RELEASE FROM U.S. ATTORNEY’S OFFICE)

BUFFALO – Acting U.S. Attorney James P. Kennedy, Jr. announced Wednesday former City of Dunkirk Mayor Richard L. Frey, 85, of Dunkirk, NY, pleaded guilty before U.S. District Judge Richard J. Arcara to wire fraud involving a scheme to defraud his mayoral campaign and his supporters by stealing campaign contributions for his personal benefit. The charge carries a maximum penalty of 20 years in prison and a $250,000 fine.

Assistant U.S. Attorney John D. Fabian and Department of Justice Trial Attorney Edward P. Sullivan of the Criminal Division’s Public Integrity Section, who are handling the case, stated that the defendant was the City of Dunkirk mayor from January 2002 until January 2012. During that time, Frey had substantial personal debt.

From January 2003, to June 2012, the defendant devised and executed a scheme to defraud the co-owners of a hospitality company that owned a hotel in Dunkirk and the owner of a food production company in Dunkirk by inducing them to make contributions to his mayoral and other political campaigns. After receiving checks from these individuals, Frey, rather than depositing the funds into a campaign or official account, simply spent them for his own personal benefit. The contributions totaled $54,361.30. In addition, Frey failed to report or disclose the contributions on his campaign disclosure reports, which is required of local candidates for public office.

The plea is the culmination of an investigation by the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Adam S. Cohen and the U.S. Housing and Urban Development, Office of Inspector General, under the direction of Special Agent in Charge Brad Geary.

Sentencing is scheduled for May 11, 2017, at 1 p.m. before Judge Arcara.