A Calverton man is being held without bail in a Nassau County jail after he was arrested by FBI agents Wednesday on charges he stole upwards of $10 million from his family-run heating and air-conditioning company in West Babylon.
Joseph Simonelli, who lives in Calverton and owns a thoroughbred horse farm on Mill Road that’s run by his stepdaughter, is facing up to 14 years in prison for conspiracy to commit mail fraud, according to court records and a criminal complaint filed in Eastern District court.
Mr. Simonelli was arraigned Wednesday in Central Islip and ordered held without bail, with a federal judge determining he was a threat to the community over allegations he had threatened to shoot his sister, who is also a business partner, said Joseph Conway of Mineola, an attorney for the family’s HVAC company, FW Sims, Inc.
The profitable and prominent contractor has done work at 1 World Trade Center and Yankee Stadium, Mr. Conway said.
Both Mr. Conway and the criminal complaint described an embezzlement scheme dating “as far back as 2008″ that involved false billings issued to FW Sims, Inc. from fictitious companies.
Mr. Simonelli, an executive vice president and director for the company, would allegedly issue the false payments, direct the money to his own bank accounts and elsewhere and provide a 5 to 10 percent kickback to co-conspirators.
No other arrests were made in the case, though Mr. Conway said prosecutors are still investigating.
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“The complaint says $10 million but when all is said and done the records are going to show it was closer to $25 million,” Mr. Conway said.
Newsday, which covered the arraignment, reported that prosecutors said Mr. Simonelli confessed to the allegations in the complaint.
The News-Review was able to confirm that report with federal authorities on Thursday.
Mr. Simonelli’s attorney on Wednesday, local public defender Randi Chavis, declined to comment, adding she would likely not be keeping the case.
Some of the money allegedly stolen from the family company — co-owned and operated by Mr. Simonelli, a brother, three sisters and a brother-in-law, Mr. Conway said — was directed to the horse farm on Mill Road in Riverhead, called Serendipity.
Work for that farm started in 2012 and it was opened in 2013. The farm is located on a 20-acre preserve, 17 of which can only be used for agricultural purposes. The farm can breed horses, which is considered farm work, but does not board or give lessons, according to an August 2013 profile piece on northforker.com, a News-Review sister publication.
There’s also a 40 feet by 220 feet barn on the land, with 20 oversized stalls for birthing mares and their foals.
The stepdaughter who runs Serendipity did not return requests for comment Thursday.
According to the criminal complaint, the alleged scheme was discovered by one of Mr. Simonelli’s sisters in October, when she “discovered a company check made payable to another company” that she did not recall the company doing business with.
A search of Mr. Simonelli’s desk drawer turned up “several documents, including copies of purchase orders, change orders, invoices and checks” that the sister “determined were false and did not correspond with work done by the company.”
Mr. Conway said the money was stolen from FW Sims’ profits and the company is in good financial shape and will continue to operate.
He added that although the company is successful, Mr. Simonelli appeared to live a more lavish lifestyle than his siblings.
“We know he led a pretty good lifestyle,” Mr. Conway said. “He’s got the farm with all the horses. He’s got a nice house, and apparently there might be luxury items, such as jewelry and fur coats and things of that nature” in his possession.
Mr. Simonelli lives in Calverton with his wife, while the stepdaughter lives at the Riverhead farm, Mr. Conway said.
Mr. Simonelli was ordered held without bail by Judge Kathleen Tomlinson because he was deemed a threat to his community, Mr. Conway said, explaining that a defendant has to be deemed either a threat or a flight risk to not be offered bail.
Prosecutors contended in documents that since the alleged scheme was discovered in October, Mr. Simonelli had threatened violence against his siblings, specifically one of his sisters whom he had allegedly previously abused.
Newsday reported that two sisters showed up in court Wednesday with body guards.
In a written request to the judge that he be held without bail, prosecutors indicate there was recorded evidence in which Mr. Simonelli could be heard threatening to use a gun. He had recently obtained a pistol license.
In the recorded Oct. 12 conversation, prosecutors alleged Mr. Simonelli could be heard saying he “could show up, pop [the sister] in the [f–in’] head, walk away … and never [f—in’] go to jail, cuz no one even knows I got the [f—in’] gun.”