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Scales of justice weigh grocery-store scheme
CALLED A CON MAN: Court officers escort Charles and Penny DeFranco, of Nesconset,
to their car after Mr. DeFranco was arraigned on a scheme to defraud indictment in
Suffolk County Court in Riverhead Monday, July 27.
By DAVID AMBRO, The Smithtown Newsplugin-Scales Of Justice_SmithtownNews_073009
While the prosecuting attorney
painted Charles DeFranco, 45, of Tap
Court, Nesconset as a con man with
a mounting list of victims, his defense
attorney denied any scam or scheme
to defraud and said his client is in the
midst of a business arrangement that
he will make good on.
Mr. DeFranco was arrested January
19, 2009 and charged with issuing a
bad check March 2, 2008 with known
insufficient funds, a misdemeanor.
After an investigation by the Suffolk
County District Attorney’s office,
spurred by a scathing report by
John Deutzman on Fox 5 News, Mr.
DeFranco was arrested July 6, 2009
and charged with scheme to defraud
in the first degree, a felony. He was
arraigned July 7 by District Court
Judge John Toomey, who set bail at
$10,000 bond and $5,000 cash, which
was posted by his wife.
Mr. DeFranco has since been
indicted by a grand jury on one count
of scheme to defraud in the first
degree and possession of a forged
instrument in the second degree. He
was arraigned Monday, July 27 in
Suffolk County Court in Riverhead
before Judge Stephen Braslow, and
pleaded not guilty.
The District Attorney’s office
alleges that Mr. DeFranco presented
to potential investors a binder
agreement August 28, 2008 signed by
Harry Laufer, president of the Long
Island grocery store chains Best Yet
and Associated Foods, for a chain of
grocery stores. Mr. Laufer, however,
never signed the binder. Between
December 1, 2007 and July 6, 2009
Mr. DeFranco is alleged to have used
the forged binder to defraud numerous
investors out of tens of thousands of
dollars.
The indictment names only Steve
Aghabekian as a victim of the alleged
fraud, but Robert Hirsch and his
brother Doug, of Splendor Landscape
Design, both in court Monday, say
they were bilked out of $30,000 by Mr.
DeFranco.
Assistant District Attorney
Christopher Nicolino told the judge
Monday that the value of the scheme is
in excess of $150,000 and that the case
is subject of an ongoing investigation.
He told the judge that the list of victims
is growing and that the amount of the
alleged scam is mounting.
Mr. Nicolino charges that Mr.
DeFranco does not own a grocery
store and never had a deal to buy
others, yet he solicited investments
in the fictitious enterprise. “He
offered partnerships in a non-existent
business venture at $30,000 to
$60,000 a pop to anyone he could
find interest from,” Mr. Nicolino said.
The victim pool included neighbors,
friends, business associates and the
people he met through the Nesconset
Little League.
Mr. Brown denied the ADA’s account
of events. He said that Mr. DeFranco is
a supermarket owner, and that he is
pursuing the purchase of additional
grocery stores. “This is not a scam or
a scheme and we are confident that
he will make good on this,” Mr. Brown
said.
The Hirsch brothers sighed in unison
in court Monday when Mr. DeFranco’s
attorney, Michael Brown, of Central
Islip, professed his client’s innocence.
They had waited out front for hours
for the defendant to arrive, then the
Hirsch brothers sat a row behind Mr.
and Mrs. DeFranco in court and they
followed them out of the courthouse
Monday afternoon, waving as the
DeFranco’s drove off.
“There is no grocery store,” Robert
Hirsch said after court Monday. “It’s
all a scam.”
Mr. Hirsch said he and his brother
came to court Monday for the
arraignment to watch Mr. DeFranco
face the charges. “Just to see his
face. I haven’t seen him in months.
I wanted to see if he would be at all
remorseful,” Mr. Hirsch said. “He was
just the opposite. He smiled and acted
as if he did nothing wrong.”
Considering that Mr. DeFranco
missed his arraignment Friday, July
24 and showed up nearly three-hours
late for his arraignment Monday,
Mr. Nicolino asked Judge Braslow
to increase Mr. DeFranco’s bail from
$5,000 cash and $10,000 bond to
$10,000 cash and $20,000 bond.
Mr. Brown pointed out to the judge
that Mr. DeFranco has no prior
criminal record, is the father of three
children with his wife Penny, and that
they have lived for eight years in their
Nesconset home. Mr. Brown said it was
due to confusion among the attorneys
and court that Mr. DeFranco missed
the arraignment Friday, and that he
was late for court Monday because of
a legitimate reason that he declined to
put on the record in court, and that
it was justifiable for him to have been
tardy. (Mr. DeFranco had reportedly
checked in to University Hospital
in Stony Brook for a psychological
evaluation. Mr. Brown held up the
paperwork in the matter in court
Monday, but declined to elaborate.)
Judge Braslow was displeased with
Mr. DeFranco’s absence from court
Friday and had threatened to issue an
arrest warrant until he was advised
that the court staff had agreed to an
adjournment to Monday, July 27. In
Court Monday, Mr. Brown said he
had a faxed letter from the court that
said the case was on for Wednesday,
July 29, but that he agreed to have
his client there Monday after having
received a telephone call from the DA’s
office.
Mr. Brown denied that Mr. DeFranco
is a flight risk, said that he understands
the seriousness of the charges against
him, and that he will not be late for
court again. “He has nothing but
Suffolk County in his background
judge. He certainly is no flight risk,”
Mr. Brown said.
After conferencing in a sidebar with
his law clerk, Judge Braslow continued
the same bail and did not increase it
to the level asked by Mr. Nicolino. He
then told Mr. DeFranco that if he is not
on time for court in the future he will
be incarcerated on bail so high that he
will not be able to make. “And none
of this fake hospital stuff, and that’s
what I consider it,” Judge Braslow told
Mr. DeFranco.
Mr. DeFranco was accompanied
to court Monday by his wife Penny,
who had posted his bail July 6. Judge
Braslow called Mrs. DeFranco to the
podium, swore her in and asked if she
agreed to transfer the bail from district
court to county court. Mrs. DeFranco
agreed, then she sat back down.
During an interview in the
courthouse Monday, Mr. Brown said
the charges against Mr. DeFranco are
a misunderstanding between he and
his investors that does not rise to the
level of a crime. “Mr. DeFranco is a
well respected father, husband, coach
and businessman in the community
and I’m sure once the facts come to
-David Ambro photos
light it will be clear there is no criminal
wrongdoing and it would be in the
best interest of everyone that this case
would be best left for the civil courts.”
When Mr. DeFranco arrived for
court Monday afternoon, Mr. Brown
told court officers in Judge Braslow’s
courtroom that he had been pushed
by a television news reporter at
the entrance to the building. Mr.
DeFranco declined to comment after
the arraignment Monday, and he was
escorted by court officers from the
courtroom to his car in the parking
lot.
“What if they’re at my house?” Mr.
DeFranco asked Mr. Brown before
they parted in the parking lot with the
court officers. Mr. Brown told him if
the news crew was at his home to call
police.