SGA,
Federal Agencies Gain Justice Against
Financial Fraud; Guilty Pleas Entered
Leaders
of the Songwriters Guild of America (SGA) reacted
recently to news that federal authorities have
filed criminal charges against the perpetrators
of a financial fraud scheme discovered by the
SGA in early 2005. “We’re
quite gratified that justice is being served,” said
Rick Carnes, president of the SGA. He and
other SGA leaders stressed that royalties of active
members were never endangered or affected by the
fraud scheme.
The
thefts focused principally on organizational cash
reserves and certain categories of unidentified
funds. “The flow of royalties to our
members has never been compromised or interrupted,
and certainly will not be,” stated Carnes.
According
to the U.S. attorney’s office
in Newark, N.J., guilty pleas by the three named
perpetrators have already been entered. Former
SGA employee Marsha Aiken, 54, of Brooklyn, N.Y.,
pleaded guilty to a single count of conspiracy
to steal money which had crossed a state boundary
after being stolen. She faces up
to five years in federal prison and a $250,000
fine. Anthony Ray, 33, of Providence, R.I., and
his cousin, Nicole Williams, 27, of Brooklyn,
N.Y., who is the daughter of Marsha Aiken, each
pleaded guilty to a single count of conspiracy
to steal money that had crossed a state boundary
after being stolen. Ray also pleaded guilty
to a tax evasion charge, which carries additional
penalties of up to five years in prison and a
$100,000 fine. Sentencing has been scheduled
by U.S. District Judge Joseph A. Greenaway, Jr.
for December.
“We’ve vigorously pursued criminal
prosecution of these perpetrators since discovery
of the fraud last year,” said Chief Operating
Officer Rundi Ream. “We are extremely pleased
with the progress of the criminal case filed. Our
attorneys have informed us that all possible restitution
will be mandated and certain monies have already
been recovered.”
“We want to hold the defendants to their
promises,” Assistant U.S. Attorney Adam
S. Lurie was quoted as stating at a recent hearing
following the filing of the guilty plea by Marsha
Aiken. “There was a lot of money taken
and we want to get it back.” According
to Lurie it is unclear how much of the stolen
money still is in the possession of the perpetrators. SGA
special counsel Charles J. Sanders added, however,
that federal civil litigation is also pending,
which could yield significant financial recoveries. The
total amount involved in the case was $1.2 million.
SGA
leaders worked in cooperation with the FBI, the
U.S. Postal Service, the Internal Revenue Service
(IRS) and the U.S. attorney’s office
throughout the investigation. “All these
agencies worked with true diligence on this matter
and the SGA is grateful to them all for their
hard work,” said Ream.
Newly
promoted to her position as COO prior to discovery
of the fraud, Ream enacted immediate security
upgrades upon detection. “We are
distressed that a trusted, long-time employee
would have acted in this manner, but our new systems
ensure this will not happen again.”
The
SGA continues to operate its offices in Weehawken,
N.J. and Los Angeles, Calif., but conducts most
of its administrative and royalty collection activities
in Nashville, Tenn. under the direction of Ream. The
Songwriters Guild Foundation, the non-profit arm
of the SGA, operates an office in New York City,
N.Y.
Carnes stressed that while implementing improvements
in the internal administrative structure of SGA,
the Guild has also increased its legislative and
litigation work.
“There has never been a time in the seventy-five
year history of the SGA that we have been faced
with greater challenges to the American songwriter
community. We’ve dealt with music piracy,
consolidation of radio stations, reduced play
lists, and now the threat posed by satellite radio
stations seeking to become digital downloading
services without payment to songwriters. We are
fighting these issues on Capitol Hill and in the
courts. Our entire organization – from our
board of directors to our administration - has
reacted to these challenges with great success
while continuing to grow in our role as protectors
of the songwriting community,” said Carnes.
The
Songwriters Guild of America represents about
5,000 songwriters throughout the United States
and the estates of deceased members. It
is the most senior organization in the nation
run solely by, and in the interests of, songwriters. |
