DA Vance: Copy Machine Vendor and Two Associates Indicted for Stealing Hundreds of Thousands of Dollars from Lease Financing Companies and Manhattan Businesses


February 27, 2015

Manhattan District Attorney Cyrus R. Vance, Jr., today announced the indictments of STEVEN HERNANDEZ, 43, for engaging in schemes to defraud financing companies and Manhattan businesses to steal copy machine lease agreement proceeds by negotiating fraudulent and fictitious office equipment leases and falsifying supporting documents, and JOHANNA DIONICIO, 35, and MACALLISTER WELLS, 40, for working with HERNANDEZ and independently to steal proceeds from fictitious lease agreements. HERNANDEZ is charged in an indictment in New York State Supreme Court with Grand Larceny in the Second Degree, Criminal Possession of a Forged Instrument in the Second and Third Degrees, Identity Theft in the First Degree, and Scheme to Defraud in the First Degree. DIONICIO and WELLS are charged in a separate indictment in New York State Supreme Court with two counts of Grand Larceny in the Second Degree for assisting HERNANDEZ with the thefts from the leasing companies, as well as a third count of Grand Larceny in the Second Degree for a separate incident.[1] 

“A copy machine is essential to nearly every business in New York,” said District Attorney Vance. “Since the cost of owning one is often prohibitively expensive for a small business, many seek financial assistance from third-party vendors to lease expensive office equipment. Typically, the vendor is responsible for negotiating these leases, acting as a liaison to the lease financing company, and coordinating the delivery of leased copy machines to the businesses. Middlemen, however, may try to take advantage of their clients during these transactions, as is alleged in today’s case. I encourage anyone who believes that his or her business may have been the victim of this fraud to call my Office’s Financial Frauds Bureau hotline at 212-335-8900.” 

According to the indictment and statements made on the record in court, between September 2012 and March 2014, HERNANDEZ, a copy machine vendor operating under various entities, including New York Office Systems Technology, LLC, Newport Business Solutions and New York Office Systems, Inc., allegedly stole more than a half a million dollars from businesses and lease financing companies by engaging in fraudulent business practices. DIONICIO and WELLS are accused of assisting HERNANDEZ with at least two fraudulent deals, and independent of HERNANDEZ facilitating an additional contract, cumulatively amounting to more than $345,000 in theft. 

Scheme Affecting Manhattan Businesses

Between September 2012 and March 2014, HERNANDEZ is accused of defrauding multiple businesses by binding them to copy machine leases under the pretense that he would purchase new equipment and/or re-finance existing copy machines by obtaining new financing in their names. In doing so, HERNANDEZ agreed to buy out any of the business’ existing copy machine lease obligations with the money from the new lease agreement. However, instead of facilitating these transactions, the defendant allegedly retained the funds from the lease agreements for himself and spent them on extravagant personal expenses, including luxury goods and cars—leaving the victimized businesses bound to multiple lease agreements for pre-owned copiers or copiers for which they never agreed to contract. By producing inaccurate or fictitious lease agreements and invoices, forging documents, and using the identity and credit of the businesses, HERNANDEZ was allegedly able to steal thousands of dollars from his victims, some of which include a Catholic Church near Herald Square, a law firm, and a travel agency. 

Scheme Affecting Lease Financing Companies

Between June and August 2013, HERNANDEZ, DIONICIO, and WELLS are accused of stealing collectively more than $200,000 from two lease financing companies, Pacific Office Automation and Xerox Financial Services, by drafting and submitting fake lease agreements and invoices and forging supporting documentation, binding Murray Hill Medical Group to lease financing agreements for copy machines that were never ordered nor authorized. DIONICIO, an employee of Murray Hill Medical Group, allegedly acted as a party authorized to enter her employer into lease financing agreements when, in fact, she had no such permission or authority. WELLS, a sales representative for HERNANDEZ, worked with HERNANDEZ and DIONICIO to create and provide the fraudulent contracts to the leasing companies. While HERNANDEZ received the requisite financing for each deal, copiers were never purchased nor delivered to Murray Hill Medical Group, and the money was instead used for personal expenses, luxury vacations, and apportioned to DIONICIO and WELLS for their assistance. 

Additional Theft By Dionicio and Wells

In November 2013, DIONICIO and WELLS independently engaged in a separate unauthorized lease financing agreement for copy machines on behalf of Murray Hill Medical Group, resulting in the theft of more than $128,000 from CIT, a lease financing company. Working with DIONICIO, WELLS processed a fictitious lease agreement through his new employer who—unaware that the lease agreement was fraudulent—distributed the proceeds of the agreement to DIONICIO and WELLS as incentive and commission, respectively, leaving WELLS’ employer to repay the stolen money. 

Assistant District Attorney Lisa Zito is handling the prosecution of the case, under the supervision of Assistant District Attorney Judy Salwen, Principal Deputy Bureau Chief of the Rackets Bureau, Assistant District Attorney Archana Rao, Principal Deputy Bureau Chief of the Financial Frauds Bureau, Assistant District Attorney Michael Sachs, Chief of the Financial Frauds Bureau, and Executive Assistant District Attorney David Szuchman, Chief of the Investigation Division. Forensic Account Investigator Susan Ryan, Senior Investigative Analyst Michelle Hershkowitz, Supervising Investigator Jonathan Reid, and Investigators Michael O’Brien and Gerald Bergold provided valuable assistance with the investigation. 

District Attorney Vance also thanked St. John the Baptist Church, the Law Offices of Spar & Bernstein, IsramWorld, Murray Hill Medical Group, Xerox Financial Services, Pacific Office Automation, and Service Comp. Business Systems, Inc. for their cooperation and assistance with the investigation.

[1] The charges contained in the indictments are merely allegations, and the defendants are presumed innocent unless and until proven guilty. All factual recitations are derived from documents filed in court and statements made on the record in court.

Defendant Information:

STEVEN HERNANDEZ, D.O.B. 2/25/1972
Nassau, NY

Charged:

  • Grand Larceny in the Second Degree, a class C felony, 6 counts
  • Criminal Possession of a Forged Instrument in the Second Degree, a class D felony, 2 counts
  • Identity Theft in the First Degree, a class D felony, 12 counts
  • Scheme to Defraud in the First Degree, a class E felony, 2 counts
  • Criminal Possession of a Forged Instrument in the Third Degree, a class A misdemeanor, 1 count

JOHANNA DIONICIO, D.O.B. 11/3/1979
Bronx, NY

Charged:

  • Grand Larceny in the Second Degree, a class C felony, 3 counts

MACALLISTER WELLS, D.O.B. 1/29/1975
Bronx, NY

Charged:

  • Grand Larceny in the Second Degree, a class C felony, 3 counts

###