FILE — The James T. Foley United States Courthouse in Albany, N.Y.
ALBANY – A former Rensselaer County-based book printer will escape federal prison time for scamming a New Jersey financial company out of hundreds of thousand of dollars in a fraud involving false invoices and bogus book-shipping documents.
John R. Paeglow III, who operated Integrated Book Technology/Hamilton Printing in Castleton-on-Hudson, will be on probation for the next three years. He must perform 100 hours of community service.
And Paeglow, 65, of Troy, also must pay $231,410 to Prestige Capital, the Fort Lee, N.J., company that fell prey to Paeglow’s scheme.
In September, Paeglow pleaded guilty to wire fraud charges before Senior U.S. District Judge Frederick Scullin. Paeglow admitted that between October 2014 and December 2014, he fraudulently solicited and received more than $428,625 for $535,000 worth of fake invoices on behalf of his business to reap money on the sale of books that were never sold or shipped, federal prosecutors for U.S. Attorney Carla Freeman said.
In a June 30 letter to prosecutors, Alan R. Eliasof, the chief executive officer of Prestige Capital, said his company lost about $751,000 as a result of Paeglow's fraud. The company had entered into an agreement with Paeglow in 2013.
"To date, John never tried to make restitution to Prestige Capital, which has caused financial harm to our company," Eliasof wrote. "As a result, Prestige has expended a tremendous amount of time and effort on this matter."
Assistant U.S, Attorney Emmett O'Hanlon, who prosecuted the case, asked the judge in a memo to impose a sentence including prison time. He said Paeglow kept taking money out of his company even six months after he acknowledged the fraud to Prestige and three months after IBT/Hamilton had laid off its last workers.
"Moreover, it is unclear whether the defendant would have ever reported the fraud to Prestige, but for the fact that Prestige eventually figured out that they were not receiving a significant percentage of the receivables that they should have, and by that point the fraud had already reached over half a million dollars," O'Hanlon told the judge.
Assistant Federal Public Defender Matthew Trainor asked for a non-jail sentence, saying his client, who had been in the printing business for decades, "has already paid dearly for his actions in the loss of his career and reputation."
He said Paeglow, whose business was in a financial crunch, "never intended for Prestige to suffer any loss on the gambit, but everyone knows the frequent destination of good intentions."
Robert Gavin covers state and federal courts, criminal justice issues and legal affairs for the Times Union. Contact him at rgavin@timesunion.com.