Ellen Meredith Stubenhaus, previously of Lake Worth, Florida., and later an expatriate living in Costa Rica, has been sentenced to 60 months in prison by U.S. District Judge M. Casey Rodgers in Tallahassee, Florida., the Justice Department and Internal Revenue Service announced.
Ms. Stubenhaus, who was extradited from Costa Rica to the United States in September 2011, had previously pleaded guilty to conspiracy to defraud the United States. In addition to her jail sentence, Ms. Stubenhaus was sentenced to three years of supervised release and ordered to pay restitution of $373,549 to the IRS, saaid the U.S. Justice Department.
According to the plea agreement and court records, Ms. Stubenhaus was a salesperson with Pinnacle Quest International (also known as PQI or Quest International). PQI was a multi-level marketing organization that operated a marketplace for a variety of vendors. Trial evidence in related cases showed that over six years between 2002 and 2008, PQI had over 11,000 members throughout the United States.
Ms. Stubenhaus admitted in court records that several PQI vendors sold bogus theories and strategies for tax evasion. She utilized the services and schemes of these fraudulent vendors to conceal her own income from selling PQI vendor products and PQI memberships. She also admitted to helping the principals of PQI conceal PQI’s income.
As Ms. Stubenhaus admitted in the statement of facts, one of the vendors operating under the PQI umbrella was the Southern Oregon Resource Center for Education, called SORCE, which assisted its customers in the creation of a series of business entities in the United States and Panamá. The CEO of SORCE, Eugene Casternovia, is serving a seven-year prison sentence after being convicted at trial of conspiracy to defraud the United States and to commit wire fraud and conspiracy to commit money laundering. His case is currently on appeal.
Court documents also showed that another PQI vendor was MYICIS, a computerized “warehouse bank.” MYICIS was a single bank account in which customers secretly pooled their money under the control of a single individual, Wayne Hicks. MYICIS had 3,000 clients and approximately $100 million in deposits over a three-year period. MYICIS was promoted to PQI’s clients as a method to hide their assets from the IRS as a result of the secret, pooled nature of the account. Wayne Hicks is currently serving a five-year sentence after pleading guilty to conspiracy to defraud the United States.
After being arrested in Costa Rica, Ms. Stubenhaus waged an unsuccessful campaign to avoid being extradited.