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Cyrus R. Vance, Jr.

District Attorney, New York County

For Immediate Release
December 20, 2011

MOTHER AND SON SENTENCED TO 4 TO 12 YEARS IN PRISON FOR STEALING $16 MILLION FROM SOHO TEXTILE COMPANY

Judy and Joseph Del Galdo Also Ordered to Pay Restitution to Victims

Manhattan District Attorney Cyrus R. Vance, Jr., announced the sentencing of JUDY DEL GALDO, 67, and her son JOSEPH DEL GALDO, 46, to 4 to 12 years in state prison for stealing more than $16 million from the textile business where JUDY DEL GALDO had worked for more than two decades. The defendants must also pay $15,523,139 in restitution to the victims. The DEL GALDOS have already repaid $850,000. On November 18, 2011, the defendants pleaded guilty to Grand Larceny in the First Degree and Money Laundering in the First Degree. JUDY DEL GALDO also pleaded guilty to Forgery in the Second Degree.

“This mother-son duo made it their family business to steal millions of dollars and squander the funds on jets, yachts, cars, and other luxury items,” said District Attorney Vance. “This sentence and restitution order will help make the victims whole.” 

According to documents filed in court and the defendants’ plea allocutions, JUDY DEL GALDO worked for 22 years as the bookkeeper for two affiliated, Manhattan-based specialty textile companies, Hi-Fashion Fabrics, Inc., and Timeless Treasures Fabrics, Inc., which were principally owned and managed by the same family. Together, the two companies employed more than 70 people from August 2003 through April 2010, the period in which the crimes took place.

During this seven-year period, the defendants laundered the stolen money through a shell company, and then spent much of it on luxury items. They also diverted millions to JOSEPH DEL GALDO’S now-defunct ambulance company. JUDY DEL GALDO forged the company president’s name on hundreds of checks that were deposited into a bank account in the name of “Tea-Rific Beverage, Inc.,” a corporation that had been dissolved years earlier and that was generating no actual business revenue. JOSEPH DEL GALDO was the sole signatory on this dummy account. As bookkeeper and a trusted, long-time employee, JUDY DEL GALDO managed to conceal these transactions until she retired in April 2010. The thefts from Hi-Fashion Fabrics, Inc. totaled approximately $6 million. The thefts from Timeless Treasures Fabrics, Inc. totaled approximately $10 million.

According to documents filed in court, the defendants channeled this stolen money through the shell bank account and then further dispersed it. They directed some $6.67 million to sustain JOSEPH DEL GALDO’S failed ambulance company, First Response Ambulance, Inc., both in the form of monetary payments to the company and through expense payments on its behalf. The defendants spent the rest on luxury items and excess, including more than:

• $500,000 in flights on private jets,
• $458,000 in other travel and hotel expenses,
• $368,000 in payments toward a million dollar yacht,
• $564,000 in various credit card payments
• $330,000 in payments for luxury suites and sponsorships at Madison Square Garden and the Meadowlands Sports Complex,
• $166,000 in home theater purchases,
• $42,000 in custom tailored suits,
• $54,000 in Apple and iTunes purchases,
• $62,000 in private school tuition,
• $493,000 in cash withdrawals, and
• $889,000 in mortgage and related payments on three different properties, all of which have since fallen into foreclosure. 

The defendants also owned a number of vehicles, including, among others, a $127,000 Mercedes S63 and a $55,000 Infiniti QX56.

Assistant District Attorney Savvas S. Diacosavvas prosecuted this case, under the supervision of Special Prosecutions Bureau Chief Thomas Wornom and Deputy Bureau Chiefs Judy Salwen and Archana Rao. Senior Financial Investigator Vincent Jones and Principal Accountant Investigator Michael Vecchio of the District Attorney’s Financial Crimes Bureau assisted in the investigation. Investigators Jonathan Reid and Behzad Ahdout of the District Attorney’s Investigations Bureau assisted in the arrest of the defendants, under the supervision of Senior Investigator Michael Wigdor and Chief Investigator John Bilich.

Defendant information:

JUDY DEL GALDO, D.O.B. 9/3/1944
Sayreville, NJ

Convicted:
• Grand Larceny in the First Degree, a class B felony, 2 counts
• Money Laundering in the First Degree, a class B felony, 2 counts
• Forgery in the Second Degree, a class D felony, 2 counts

Sentenced:
• 4 to 12 years in state prison
• $15,523,139 restitution for both defendants

JOSEPH DEL GALDO, D.O.B. 6/15/1965
Buford, GA

Convicted:
• Grand Larceny in the First Degree, a class B felony, 2 counts
• Money Laundering in the First Degree, a class B felony, 2 counts

Sentenced:
• 4 to 12 years in state prison
• $15,523,139 restitution for both defendants

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