Discovery Tours vice president charged with embezzling $600K


By Eric Heisig - Advance Ohio Media, Cleveland (TNS)



CLEVELAND, Ohio — The vice president of a now-defunct educational tours company faces more than a dozen criminal charges, as the FBI said he embezzled more than $600,000 from the business started by his father.

Joseph Cipolletti’s widespread theft from Discovery Tours forced the Mayfield Village-based company to shut down and file for bankruptcy, according to a news release from the U.S. Attorney’s Office. He used the money to buy vehicles and to carry out a lavish renovation of the backyard of his house in Hudson.

A federal grand jury indicted Cipolletti Thursday on 18 charges, including wire fraud, money laundering, bank fraud and making a false statement under oath. His lawyer Lester Potash did not immediately return a phone call.

Discovery Tours, founded by Joseph’s father Alfred Cipolletti, ran educational tours for schools for more than three decades and abruptly closed in May 2018. The closure canceled trips to Washington, D.C., Chicago and Dearborn, Michigan for dozens of schools across Ohio, even after more than 5,000 families paid millions of dollars in trip fees.

The company said in bankruptcy filings that it had about $1.4 million in assets and owed about $3.9 million. Cipolletti and his wife filed for bankruptcy last year, claiming they were more than $550,000 in debt.

Summit County Prosecutor Sherri Bevan Walsh in 2018 requested the FBI investigate Discovery Tours.

“As a result of the defendant’s alleged actions, his place of business was forced into bankruptcy and our community’s schoolchildren were deprived of invaluable experiences and memories,” U.S. Attorney Justin Herdman said in a news release.

As vice president, Joseph Cipolletti’s job was to manage Discovery Tour’s finances. He also had signature authority on the company’s bank accounts.

He stole the money between 2014 and 2018 by withdrawing company cash, purchasing money orders made payable to himself and depositing it in his personal bank account, prosecutors said.

Cipolletti made efforts to hide it, according to prosecutors. He made false entries in the company’s general ledger that claimed the money he stole was for trips and forged an email to a hotel vendor that claimed the company lost more than $200,000 due to a hacked account, officials said. He also paid vendors for previous student trips with deposits for future trips, according to the news release.

A hotel in Virginia emailed Cipolletti in May 2016 and said payments for a previous school trip were overdue and that Discovery Tours had to prepay for future events. The next student group could not check-in if the hotel didn’t receive the money in time, according to prosecutors.

Two days later, knowing the company didn’t have enough money in its accounts, Cipolletti wrote five checks totaling $72,540 and had an employee go to Virginia to deliver the checks in person. All the checks bounced, according to the release.

He also took out high-interest loans to cover the losses he caused, and those payments were what drove Discovery Tours into bankruptcy, officials said.

All the while, he used the money on himself, including the work on his house and backyard, which included extensive landscaping, a deck, a patio and a three-season room.

Cipolletti gave an interview to the Housetrends website for an article that featured pictures of the backyard.

“We set a budget and we went a bit over but we were always informed by Keith,” he told the website, referring to landscape architect Keith Laninga. “Once we had the architectural blueprints approved by the city and Ohio Valley Group started to build it, you think ‘I wouldn’t mind trying this or that.’ The patio by the fireplace is about twice the size originally planned. When they laid it out, we saw we needed to add on.”

In December 2018, when questioned as part of Discovery Tours’ bankruptcy case, Cipolletti lied and said he did not owe the business any money, prosecutors said.

The case is assigned to U.S. District Judge Pamela Barker.

https://www.limaohio.com/wp-content/uploads/sites/54/2020/07/web1_Ohio-51.jpg

By Eric Heisig

Advance Ohio Media, Cleveland (TNS)

Post navigation