SACRAMENTO, Calif. October 15, 2020 – A federal grand jury returned a two-count indictment today against Daniel Stewart, 56, of Lincoln, and Luke Burroughs, 56, of Rocklin, charging them with money laundering and money laundering conspiracy, U.S. Attorney McGregor W. Scott announced.
According to court documents, Stewart and Burroughs own and operate Western Baler and Conveyor, a Rocklin-based company that sells and services equipment for waste management facilities. Stewart and Burroughs created a scheme to disguise personal expenses as business expenses, including writing company checks to pay for over $350,000-worth of renovations to their personal residences. This scheme, however, did not generate enough expenses to offset all of the tax liability of the company.
In response, in early 2019 after complaining about having to pay $300,000 to the Internal Revenue Service, Stewart and Burroughs agreed to help launder money for a person they believed to be an interstate drug dealer. Between March 2019 and October 2020, Stewart and Burroughs wrote company checks for over $1 million to help the interstate drug dealer to hide his drug money. The drug dealer was in a fact an undercover law enforcement officer.
This case is the product of an investigation by the IRS Criminal Investigation and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorney Justin Lee is prosecuting the case.
If convicted, the defendants face a maximum statutory penalty of 20 years in prison and a $250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.