BOSTON – The United States Attorney’s Office announced today that $884,755 recovered from forfeited assets of Scott J. Wolas will be distributed to his victims. The United States Attorney’s Office expressly sought permission to have the forfeited assets directly applied to victim restitution, which was granted by the Department of Justice.
Wolas, who had been a fugitive for more than 20 years prior to his arrest in April 2017, was convicted in 2018 of seven counts of wire fraud, one count of aggravated identity theft, one count of misuse of a Social Security number and one count of tax evasion in connection with $1.9 million real estate investment fraud scheme in Quincy.
“My office will diligently pursue financial recovery for our crime victims—even years after someone has been convicted and sentenced, we will continue our pursuit,” said United States Attorney Rachael S. Rollins. “These ill-gotten gains have finally been recovered and our efforts send an important message that crime does not pay.”
In January 2019, Wolas was sentenced by U.S. District Court Chief Judge F. Dennis Saylor IV to 81 months in prison, three years of supervised release and ordered to pay $1,949,813 in restitution to the victims of his fraud scheme. Chief Judge Saylor also ordered Wolas to pay $69,768 in restitution to Social Security and Medicare, $318,266 in restitution to the IRS and entered a forfeiture money judgment of $1,949,813.
From at least 2009 through 2016, Wolas, using the name Eugene Grathwohl, operated a real estate business known as Increasing Fortune Inc. and worked as a licensed real estate agent for Century 21 in Quincy. From 2014 through 2016, he solicited investments for the development of the Beachcomber Bar property on Quincy Shore Drive and for the construction of a single-family home on the adjacent property. He collected more than $1.9 million from at least 24 investors and promised each of them a significant return on their investments. He further promised to pay out at least 125% of the profits related to the single-family home construction. However, Wolas used the money mostly for personal expenses unrelated to development of the real estate projects.
Law enforcement then discovered that Grathwohl was actually Wolas, a former lawyer who had been a fugitive since 1997 after being charged with fraud and grand larceny in New York. The real Eugene Grathwohl resided in Florida and was known to Wolas.
On Nov. 17, 2016, law enforcement officers interviewed Wolas’ ex-wife, Cecily Sturge, of Delray Beach, Fla., who stated that she had not been in contact with her ex-husband for approximately 15 years, since their divorce in 2001. Further investigation determined this was false and that Wolas had stayed at a condo rented under Sturge’s name five days prior to her interview with law enforcement. Sturge later pleaded guilty to making a materially false statement to a federal agent and was sentenced in May 2018 to one year of probation.
Prior to her conviction, Sturge filed a petition with a Florida court in February 2017 to modify the 2001 divorce judgment to obtain the contents of Wolas’ retirement account. At the time Sturge filed the petition, Wolas’ retirement account had a balance of approximately $647,000 from the law firm where he worked prior to being indicted in 1997 by New York authorities. Sturge had previously tried to obtain the retirement account by claiming Wolas was dead, but in 2016, Wolas suggested that they amend the divorce decree to get access to the account. Law enforcement established that Wolas had drafted the petition to modify the divorce judgment to transfer the contents of Wolas’ retirement account to Sturge. The petition that Wolas drafted and Sturge signed falsely stated that Sturge did not know Wolas’ whereabouts. After Wolas’ arrest, he and Sturge continued to discuss the transfer of the retirement account during jail calls and using thinly veiled code words.
After the Florida court allowed Sturge’s petition, but before the account was transferred to her, the U.S. Attorney’s Office restrained the retirement account and moved to forfeit it. Sturge opposed forfeiture, claiming ownership of the retirement account. In February 2021, Chief Judge Saylor issued a 39-page memorandum and order finding that the transfer of the retirement account to Sturge was a fraudulent transfer and granted the government’s motion to deny her ownership claim. As a result, the retirement account was liquidated and $884,755 was turned over to the United States. The United States Attorney’s Office then sought permission to have the forfeited assets applied to victim restitution, which was granted by the Department of Justice’s Money Laundering and Asset Recovery Section in January 2022.
United States Attorney Rollins; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division; Joleen D. Simpson, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; John Cremonini, Acting Special Agent in Charge of the Social Security Administration, Office of Inspector General, Office of Investigations, Boston Field Division; and Quincy Police Chief Paul Keenan made the announcement today. Assistant U.S. Attorney Carol E. Head, Chief of Rollins’ Asset Recovery Unit, handled the forfeiture litigation.