Guilty plea from businessman at the center of a Carl Monday Investigation

Guilty plea from businessman at the center of a Carl Monday Investigation

A Cleveland man who was the focus of a Carl Monday Investigation has pleaded guilty in federal court to fraud, money laundering and violating the Clean Air Act by failing to remove asbestos prior to demolishing a former factory.

According to court documents, 51-year-old Christopher Gattarello owned and controlled several municipal garbage-hauling businesses in greater Cleveland, including Reach Out Disposal, All Points Rubbish Disposal, and Axelrod Rubbish Recycling.

Gattarello, on behalf of All Points, leaded the former National Acme facility at 170 East 131st Street in Cleveland in June 2011. He told the lessor that paper and cardboard waste would be recycled at the facility.

Around August 2011, Gattarello directed that paper and cardboard waste, as well as municipal garbage, be delivered to the facility for recycling.

Less than one year later, most of the building was filled with garbage.

In May 2012, Gattarello, on behalf of Reach Out, entered into a contract to purchase the facility. Gattarello intended to demolish the facility and sell any metal removed as scrap.

Before he could demolish the building, asbestos had to be removed, a process estimated to cost $1.5 million.

In July 2012, company officials submitted a notice of demolition with the Cleveland Division of Air Quality stating there was no asbestos in the National Acme facility.

About ten days later, the CDAQ rejected the notice because it was incomplete and stated that demolition "may not begin" until a proper notice was submitted and approved.

About ten days after that, on July 21, 2012, Gattarello directed the demolition to begin.

Asbestos fibers were released into the environment during demolition. Debris accumulated outside the facility from demolition and asbestos in the piles were exposed to the wind and elements.

Additionally, Gattarello pleaded guilty to one count each of conspiracy to commit wire fraud and money laundering. 

AIM Business Capital LLC is a financial company based in Louisiana that specializes in "factoring," a practice in which AIM purchases accounts receivable, such as invoices billed to customers for goods and services. Businesses that factored their receivables with AIM received immediate cash. AIM, like other factoring companies, purchase the receivables at a percentage discount of the invoice. AIM made a profit by collecting the full amount of the invoice from the business's customers, according to court documents.

In 2011 and 2012, Robert Shaw, on behalf of Reach Out and Axelrod, entered into contracts with AIM for the purchase of receivables from Reach Out and Axelrod.

Gattarello directed the creation of false and fraudulent invoices for the companies and directed that they be submitted to AIM.

In some cases, Gattarello and Shaw directed other employees to create false letters attesting to the validity of the invoices, which Shaw forwarded to AIM. The loss to AIM was nearly $1.2 million, according to court documents.

Shaw's case is pending.

Gattarello is scheduled to be sentenced June 19.

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