DANVERS — A Danvers woman’s retirement account, worth nearly $200,000, was completely drained of funds by what prosecutors believe is a criminal ring with ties to Maryland and Nigeria, the Essex District Attorney’s office said in court Tuesday.
One member of that ring, Kayode Adams, 35, of Bladensburg, Maryland, was arrested on a warrant by Immigration and Customs Enforcement at Washington Dulles International Airport in April, as he arrived on a flight from Nigeria.
Adams was indicted by an Essex County grand jury in March, following an investigation by Danvers police and the Essex District Attorney’s office. Prosecutor Erin Bellavia had obtained a sealed warrant for Adams after the indictment, which charged him with receiving stolen property.
He has pleaded not guilty to the charge and is being held on $250,000 bail.
Bellavia said the woman, who is in her 50s, discovered last October that there were no funds left in her 401(k), which was being managed by a firm called Alight Solutions.
She went to Danvers police, who discovered that someone had called Alight pretending to be her and asked to add a Bank of America account to the 401(k) so that funds could be transferred out of the retirement account, Bellavia told Judge Thomas Drechsler.
That account belonged to a Maryland business called Adams Auto Sales LLC. Adams is listed in Maryland records as the registered agent of that business.
Before adding the Bank of America account, Alight sent a “verification” code to the woman’s email.
She later discovered that her email had been hacked, after colleagues on the board of a local nonprofit where she volunteers began receiving strange emails under her name, asking for money.
In two transfers, Bellavia said, someone moved all of the funds out of the 401(k) account and into the Bank of America account — though Alight did withhold $40,000 to $50,000 for taxes, said the prosecutor.
In Maryland and Virginia, Adams was captured on video surveillance at multiple Bank of America branches buying cashier’s checks payable to a range of other entities, including corporations that had been set up using residential addresses, as well as to auto auctions.
“This appears to be a criminal network,” said Bellavia. “The Commonwealth believes it’s unlikely he’s acting alone.”
Adams’ attorney, Joseph Hernandez, suggested his client was “duped” by someone into believing the funds were legitimate payments for his business, which involves exporting luxury cars and merchandise to Nigeria, where Adams was born.
Hernandez, who recently joined the Boston law firm LibbyHoopes, which specializes in white-collar criminal defense law, told the judge that Adams would have had no reason to suspect that the sudden infusion of funds into an account was the result of fraud.
“This is the other side of the story,” said Hernandez, who urged the judge to release Adams on personal recognizance, or at the most, $10,000.
But Drechsler — who as a defense attorney also handled a number of high-profile, white-collar criminal cases — expressed skepticism about the claim.
“It’s an interesting defense,” said Drechsler, “but what I don’t have are any affidavits or evidence. ... Everything you’re telling me in terms of a defense, I have no corroboration for.”
Judge not swayed
And he suggested that if Adams is so used to having access to large amounts of funds, he could potentially use those funds to flee.
“I guess what puzzles me is if he’s not engaged in a fraudulent scheme and he does these large transactions all the time,” said Drechsler, “if he’s doing transactions of this magnitude all the time, he’s dealing in large amounts of money all the time, that’s a concern. ... $250,000 would seem not to be a problem.”
He also pointed to the victim’s loss of her life savings.
“This is a large amount of money taken from an innocent victim,” said Drechsler.
Hernandez argued that Adams needs to be released from custody so that he can go back to Maryland and obtain evidence to support his defense. Hernandez also argued that while Bellavia referred to a $200,000 loss to the victim, Adams had access to only $152,000 because of the withheld taxes and that the victim may be able to get the taxes back.
Hernandez also pointed to a group of half a dozen men in the courtroom, who he said had traveled overnight from Maryland to support Adams in court.
And he disputed that Adams had access to large amount of money, saying he is paid through commissions and “does not make a substantial income.”
“I don’t find those representations to be credible,” said Drechsler.
“What I do have is $200,000 electronically stolen, her hard-earned 401(k) funds stolen from her,” said the judge.
Drechsler kept the bail at $250,000, which he’d set last week at Adams’ arraignment, and ordered that before bail is posted, Adams, who still maintains Nigerian citizenship despite becoming naturalized, must surrender his passport.
A pretrial conference has been scheduled for May 22.
A spokeswoman for Alight Solutions said she would need to look into the case before commenting.
Courts reporter Julie Manganis can be reached at 978-338-2521, by email at firstname.lastname@example.org or on Twitter at @SNJulieManganis.