MN Man Accused Of Embezzling Millions From Retired Exec.
An Eden Prairie man has been indicted for allegedly embezzling millions of dollars from his longtime employer, according to Minnesota’s U.S. Attorney’s office.
John Joseph Waters, Jr., 56, is charged with four counts of mail fraud, 16 counts of wire fraud, three counts of income tax evasion, and three counts of filing a false income tax return. The indictment alleges that from at least 1999 through at least March 2012, Waters embezzled funds from his employer, a former executive for West Publishing.
A Pioneer Press report identified the former employer as Gerard Leon Cafesjian, the man whose name appears on Como Park’s historic Cafesjian Carousel. The dispute over Waters’ alleged theft began as a civil case, and many of the allegations had previously surfaced. Waters reportedly brought a civil suit against Cafesjian, one of his companies, and his family foundation last year, alleging that they owed him millions of dollars in unpaid compensation. Cafesjian, in turn, countersued, accusing Waters of embezzlement.
After retiring in 1996, Cafesjian hired Waters to manage his personal, business, and philanthropic pursuits, a role in which he managed Cafesjian’s “considerable assets, including numerous bank, trust, and investment accounts,” the U.S. Attorney’s Office said.
Waters is accused of transferring millions of dollars from his employer’s accounts to accounts that he controlled, without Cafesjian’s permission. To hide the scheme, he “used a bank account he controlled in the name of a deceased foreign exchange student, made false entries in his employer’s books and records, and directed others to refrain from reviewing certain bank statements,” according to the U.S. Attorney’s Office.
Once Waters exited his role and the embezzlement was discovered, he allegedly threatened Cafesjian, warning him that harmful information about him would be revealed if he turned Waters in, federal prosecutors said.
The indictment also states that Waters failed to report the millions of dollars he allegedly embezzled on several years of tax returns.
If convicted, Waters faces up to 20 years in prison on each count of mail and wire fraud, five years on each count of income tax evasion, and three years on each count of filing a false tax return.
In May, a judge threw out Waters’ civil claim, and Cafesjian's counterclaim could go to trial in October, the Pioneer Press reported.
While the U.S. Attorney’s Office didn’t say how much Waters allegedly embezzled, Cafesjian’s civil lawsuit accuses Waters of embezzling at least $2.8 million, according to the St. Paul newspaper.