Sophisticated Scheme Unveiled
A sophisticated scheme to defraud Patterson Joint Unified School District has been unveiled, with senior officials Jeffrey Menge and Eric Drabert at the helm, using the district’s resources to mine cryptocurrency illegally, as disclosed by the DOJ.
Guilty Pleas and Charges
Two senior officials from the Patterson Joint Unified School District in California have admitted to exploiting school resources for their own gain, including orchestrating a cryptocurrency mining operation, the U.S. Department of Justice (DOJ) disclosed. Jeffrey Menge, 43, of Copperopolis, and Eric Drabert, 44, of Modesto, entered guilty pleas to charges of theft concerning programs receiving federal funds, as announced by U.S. Attorney Phillip A. Talbert.
Elaborate Scheme and Deceitful Dealings
From 2018 through 2022, Menge, serving as the Assistant Superintendent and Chief Business Officer, alongside Drabert, the IT Director hired in 2020, engaged in fraudulent activities to siphon off funds from the school district. Their elaborate scheme involved over $1.2 million in deceitful dealings through Cencal Tech LLC, a company under Menge's control. By creating a fictitious executive, "Frank Barnes," they bypassed restrictions on transactions with the school, engaging in double billing and charging for undelivered items.
Crypto Mining Farm and Electricity Consumption
The duo's illicit activities extended beyond financial misconduct. Utilizing high-end graphics cards and other district-owned resources, Menge and Drabert established a crypto mining farm within the district's facilities, directing the proceeds into personal wallets. The operation, whose scope across the district's 10 schools remains unclear, significantly increased electricity consumption, a matter of growing concern for U.S. energy regulators amidst a crackdown on energy-intensive crypto mining.
Exploitation of District Vehicles and Lavish Spending
In addition to the mining operation, Menge exploited district vehicles for personal gain, including the sale of a Chevy truck acquired at a bargain and the personal use of a Ford Transit van. The funds embezzled, ranging between $1 million to $1.5 million for Menge and $250,000 to $300,000 for Drabert, were lavishly spent on home renovations, luxury cars, and other personal expenses.
Are there other illicit mining operations?
Do you think there are many other illicit mining operations? Share your thoughts and opinions about this subject in the comments section below.
Frequently Asked Questions
How much should I contribute to my Roth IRA account?
Roth IRAs are retirement accounts where you deposit your own money tax-free. You can't withdraw money from these accounts before you reach the age of 59 1/2. You must adhere to certain rules if you are going to withdraw any of your contributions prior. First, you can't touch your principal (the initial amount that was deposited). This means that no matter how much you contribute, you can never take out more than what was initially contributed to this account. If you are able to take out more that what you have initially contributed, you must pay taxes.
The second rule says that you cannot withdraw your earnings without paying income tax. So, when you withdraw, you'll pay taxes on those earnings. Let's take, for example, $5,000 in annual Roth IRA contributions. Let's also say that you earn $10,000 per annum after contributing. The federal income tax on your earnings would amount to $3,500. The remaining $6,500 is yours. You can only take out what you originally contributed.
You would still owe tax on $1,500 if you took out $4,000 of your earnings. On top of that, you'd lose half of the earnings you had taken out because they would be taxed again at 50% (half of 40%). So, even though you ended up with $7,000 in your Roth IRA, you only got back $4,000.
There are two types if Roth IRAs: Roth and Traditional. Traditional IRAs allow pre-tax contributions to be deducted from your taxable tax income. You can withdraw your contributions plus interest from your traditional IRA when you retire. You have the option to withdraw any amount from a traditional IRA.
Roth IRAs do not allow you to deduct your contributions. Once you are retired, however, you may withdraw all of your contributions plus accrued interest. There is no minimum withdrawal limit, unlike traditional IRAs. Your contribution can be withdrawn at any age, not just when you reach 70 1/2.
What are the benefits of a Gold IRA?
The best way to invest money for retirement is by putting it into an Individual Retirement Account (IRA). It will be tax-deferred up until the time you withdraw it. You can decide how much money you withdraw each year. There are many types available. Some are better suited to college savings. Others are designed for investors looking for higher returns. Roth IRAs are a way for individuals to make contributions after the age of 59 1/2, and then pay taxes on any earnings upon retirement. But once they start withdrawing funds, those earnings aren't taxed again. This type account may make sense if it is your intention to retire early.
Because it allows you money to be invested in multiple asset classes, a ‘gold IRA' is similar to any other IRAs. Unlike a regular IRA you don't need to worry about taxes while you wait for your gains to be available. People who prefer to save their money and invest it instead of spending it are well-suited for gold IRAs.
An additional benefit to owning gold through an IRA, is the ease of automatic withdrawals. This means that you don't need to worry about making monthly deposits. To avoid missing a payment, direct debits can be set up.
Finally, gold remains one of the best investment options today. It is not tied to any country so its value tends stay steady. Even in times of economic turmoil gold prices tend to remain stable. It is therefore a great choice for protecting your savings against inflation.
Is gold a good IRA investment?
Gold is an excellent investment for any person who wants to save money. It's also a great way to diversify your portfolio. There is much more to gold than meets your eye.
It's been used throughout history as a currency, and even today, it remains a popular form of payment. It's sometimes called “the world's oldest money”.
Gold is not created by governments, but it is extracted from the earth. Because it is rare and difficult to make, it is extremely valuable.
Gold prices fluctuate based on demand and supply. The economy that is strong tends to be more affluent, which means there are less gold miners. The value of gold rises as a consequence.
On the other hand, people will save cash when the economy slows and not spend it. This means that more gold is produced, which reduces its value.
This is why investing in gold makes sense for individuals and businesses. If you invest in gold, you'll benefit whenever the economy grows.
In addition to earning interest on your investments, this will allow you to grow your wealth. You won't lose your money if gold prices drop.
Who is the owner of the gold in a gold IRA
The IRS considers anyone who owns gold to be “a form money” and therefore subject to taxation.
To be eligible for the tax-free status, you must possess at least $10,000 gold and have had it stored for at least five consecutive years.
Although gold can help to prevent inflation and price volatility, it's not sensible to have it if it's not going to be used.
If you plan on selling the gold someday, you'll need to report its value, which could affect how much capital gains taxes you owe when you cash in your investments.
To find out what options you have, consult an accountant or financial planner.
Is it a good idea to open a Precious Metal IRA
Before opening an IRA, it is important to understand that precious metals aren't covered by insurance. It is impossible to get back money if you lose your investment. All your investments can be lost due to theft, fire or flood.
Protect yourself against this type of loss by investing in physical gold or silver coins. These items are timeless and have a lifetime value. You would probably get more if you sold them today than you paid when they were first created.
If you decide to open an IRA account, choose a reputable company that offers competitive rates and products. You should also consider using a third party custodian to protect your assets and give you access at any time.
Do not open an account unless you're ready to retire. Remember the future.
What is the value of a gold IRA
There are many benefits to a gold IRA. It's an investment vehicle that allows you to diversify your portfolio. You decide how much money you want to put into each account, and when you want it to be withdrawn.
You can also rollover funds from other retirement accounts to a gold IRA. This will allow you to transition easily if it is your decision to retire early.
The best part is that you don't need special skills to invest in gold IRAs. They are readily available at most banks and brokerages. You don't have to worry about penalties or fees when withdrawing money.
There are also drawbacks. Gold is known for being volatile in the past. It is important to understand why you are investing in gold. Are you seeking safety or growth? Are you looking for growth or insurance? Only then will you be able make informed decisions.
You might want to buy more gold if you intend to keep your gold IRA for a long time. A single ounce will not be sufficient to meet all your requirements. Depending on your plans for using your gold, you may need multiple ounces.
You don't have to buy a lot of gold if your goal is to sell it. You can even manage with one ounce. However, you will not be able buy any other items with those funds.
Can the government take your gold
You own your gold and therefore the government cannot seize it. You worked hard to earn it. It belongs entirely to you. There may be exceptions to this rule. If you are convicted of fraud against the federal government, your gold can be forfeit. If you owe taxes, your precious metals could be taken away. However, even if taxes are not paid, gold is still your property.
Statistics
- (Basically, if your GDP grows by 2%, you need miners to dig 2% more gold out of the ground every year to keep prices steady.) (smartasset.com)
- Indeed, several financial advisers interviewed for this article suggest you invest 5 to 15 percent of your portfolio in gold, just in case. (aarp.org)
- If you take distributions before hitting 59.5, you'll owe a 10% penalty on the amount withdrawn. (lendedu.com)
- The price of gold jumped 131 percent from late 2007 to September 2011, when it hit a high of $1,921 an ounce, according to the World Gold Council. (aarp.org)
- Contribution limits$6,000 (49 and under) $7,000 (50 and up)$6,000 (49 and under) $7,000 (50 and up)$58,000 or 25% of your annual compensation (whichever is smaller) (lendedu.com)
External Links
forbes.com
- Gold IRA: Add Some Sparkle To Your Retirement Nest Egg
- Understanding China's Evergrande Crisis – Forbes Advisor
bbb.org
irs.gov
law.cornell.edu
- 7 U.S. Code SS7 – Designation board of trade as contract marketplaces
- 26 U.S. Code SS 408 – Individual retirement accounts
How To
The History of Gold as an Asset
From the ancient days to the early 20th Century, gold was a common currency. It was universally accepted due to its purity and divisibility, beauty, scarcity, and durability. Aside from its inherent value, it could be traded internationally. However, since there were no international standards for measuring gold at this point, different weights and measures existed worldwide. One pound sterling, for example, was equivalent in England to 24 carats, and one livre tournois, in France, to 25 carats. A mark, on the other hand, was equivalent in Germany to 28 carats.
The United States began issuing American coin made up 90% copper, 10% zinc and 0.942 fine-gold in the 1860s. This led to a decline in demand for foreign currencies, which caused their price to increase. The United States began minting large quantities gold coins at this time, which led to a drop in the price. Because the U.S. government had too much money coming into circulation, they needed to find a way to pay off some debt. They sold some of their excess gold to Europe to pay off the debt.
Most European countries distrusted the U.S. Dollar and began to accept gold as payment. However, after World War I, many European countries stopped taking gold and began using paper money instead. The price of gold rose significantly over the years. Today, although the price fluctuates, gold remains one of the safest investments you can make.
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