Atlanta, Georgia – Derek Cyrus and Chuck Sandford have been sentenced for running a false invoicing scheme that defrauded the Panda Express restaurant chain of nearly $1.5 million.
“These defendants’ calculated lies and fraud were driven by simple greed,” said U.S. Attorney Byung J. “BJay” Pak. “They not only stole from this corporation, Cyrus and Sandford also lied in a state court, which demonstrated their lack of respect for the law. Now they have years to reflect on those actions while serving their federal sentences.”
“As a result of hard work and determination by Special Agents of the FBI, Derek Cyrus and Chuck Sandford are no longer able to deceive an innocent company,” said David J. LeValley, Special Agent in Charge of FBI Atlanta. “The FBI will continue to dedicate significant investigative resources to prosecute those who allow their good judgement to be clouded by greed.”
According to U.S. Attorney Pak, the charges, and other information presented in court: Derek Cyrus and Chuck Sandford both owned companies that ostensibly provided recruitment services to corporations. Cyrus’s company was named “Diversified Recruiters,” and Sandford’s recruitment company was named “Chuck Sandford Consultants” (CSC). Cyrus also worked as an in-house recruiter for Panda Express in 2012 and early 2013.
Beginning in about January 2013, Cyrus and Sandford submitted fraudulent Diversified Recruiters and CSC invoices to the Panda Express accounts payable department that falsely claimed that they had found qualified job candidates for positions at Panda Express restaurants throughout the United States. In actuality, the vast majority of the job candidates were either fictitious or had never been recruited by Cyrus or Sandford. Cyrus also did not tell the accounts payable department that Diversified Recruiters was actually his own company, which allowed him to collect twice for the same recruit. Based upon these misrepresentations, the accounts payable department issued payments to Diversified Recruiters and CSC, which Cyrus and Sandford used for their own personal benefit.
After Cyrus stopped working for Panda Express in March 2013, he continued to send fraudulent Diversified Recruiters and CSC invoices to the accounts payable department. Cyrus falsely told the accounts payable department that he was still a Panda Express employee and was therefore authorized to submit these invoices. Sandford paid Cyrus a kickback after the accounts payable department issued payments for the fraudulent CSC invoices. All told, Cyrus and Sandford netted nearly $1.5 million dollars during the course of this scheme.
Once Panda Express discovered the fraud, they sued Cyrus and Sandford in Cobb County, Georgia. During the course of that litigation, Cyrus further attempted to cover his tracks by submitting false recruit resumes through his attorney to Panda Express’s corporate counsel. Additionally, both defendants repeatedly lied under oath during their sworn depositions about their involvement in the fraud scheme.
Derek Cyrus, 53, of Lithonia, Georgia, was sentenced to four years, five months in federal prison. Chuck Sandford, 74, of Marietta, Georgia, was sentenced to one year, three months in federal prison. Both defendants had previously pleaded guilty to fraud charges for their role in this scheme.
The press release is available at justice.gov.