Home » Olivet faces expanded indictment in $25 million fraud probe

Olivet faces expanded indictment in $25 million fraud probe

DOVER — The investigation into Olivet University’s connection with a Newsweek Media Group (NMG) investigation of charges of money laundering continues. The indictment that charged NMG’s parent company, IBT Media, now also includes both the university and some of its officers.

Olivet Chairman of the Board Andrew Lin (aka Tony Lin), Olivet Finance Director and Dean of Olivet Business School Lingyi Xiao (aka John Xiao) and Christian Media Corporation and Olivet Trustee William Anderson have all been included in the indictment charging them with “fraudulently obtaining at least $25 million in financing under Olivet’s name, and laundering the money in order to obscure its origins and fund Olivet’s operations,” according to Manhattan District Attorney (DA) Cyrus R. Vance Jr.

That indictment supersedes, and includes, charges that came last month against IBT Media Inc. (aka Newsweek Media Group, Etienne Uzac, William Anderson, Christian Media Corporation and Oikos) “for fraudulently obtaining $10 million in financing, and laundering the money through a network of corporate bank accounts,” stated a release from Vance’s office.

Olivet is a fundamentalist Christian University based in San Francisco, Calif., with a campus at the former Harlem Valley Psychiatric Center in Wingdale. It purchased the site in 2013; the property was valued at $2.3 million at the time, according to county records. Olivet bought an additional 23 properties in the town of Dover, which includes the hamlet of Wingdale. Its campus now stretches across 1,000 acres. Olivet’s development was later renamed Dover Greens, and includes plans to develop an education, IT and research center with retail vendors. 

According to the expanded indictment, the defendants face 16-counts, including scheme to defraud in the first degree, various counts of conspiracy in the fourth degree, money laundering in the second degree, falsification of business records in the first degree and criminal contempt in the second degree.

“After unmasking the scheme to keep Newsweek and Christian Media Corporation afloat,” stated Vance, “my office’s Major Economic Crimes Bureau skillfully followed the money, revealing an even larger scheme to defraud lenders throughout the country, and the cycle of ill-gotten gains through a maze of corporate bank accounts.”

According to the DA’s office,  to secure funding, Anderson and Xiao “overstated the financial health of Olivet to prospective lenders and provided false financial statements to the lenders.

“To make their false financial statements appear legitimate, the defendants and unindicted co-conspirators created a fictional auditor … and created and maintained a phone number and email address … knowing that no CPA by that name audited Olivet’s financials.”

Vance said his office takes such charges seriously.

“If you illegally move money through New York’s financial system, my office will hold you accountable, whether your business is securities, magazines or university degrees,” he said.

Olivet University posted an official statement on its website,  www.olivetuniversity.edu.

“Olivet University denies the charges announced … by the district attorney’s office and will vigorously defend itself against these unsupported allegations — including the puzzling claim that lenders [who] have suffered no loss were somehow victimized. Olivet stands strongly by the individual members of its team who have been wrongfully accused. Olivet is a Christian institution dedicated to providing educational and spiritual opportunities to students around the globe — including in locations that are hostile to Christianity and Christian practice. Olivet is no stranger to adversity and looks forward to being fully vindicated in court.”

Since its Dover expansion, Olivet has faced some hurdles. In 2016, the U.S. Department of Labor’s Occupational Safety and Health Administration (OSHA) cited Olivet for exposing employees to lead and asbestos. The case was settled, and Olivet was given 10 years to pay $700,000  in fines — a fraction of the $2.3 million in fines originally levied. Dover Greens also has to comply with a number of safety regulations laid out by OSHA.

More recently, Olivet was tied to investigative reporting done at Newsweek magazine, based on a story about the magazine firing an executive editor, editor in chief and investigative reporter pursuing a story about financial entanglements at NMG.

The local tie-in came after Dutchess County acknowledged it accepted free advertising in Newsweek from Olivet for the Think Dutchess Alliance for Business, a county marketing campaign collaboration with Dutchess County Tourism. 

The ads ran in Newsweek in spring 2017. At the time, Dutchess County Communications Director Colleen Pillus went on the record about the free advertising.

“There was a documented paper trail that there were no commitments or expectations,” she said, adding approvals from the town of Dover are done independently of the county.

According to a statement from Dover Greens, it “decided to help Dutchess County through our acquaintance with Newsweek owners,” adding its relationship with the county has “always been open and honest.”

The university’s troubles continued when Vance’s office conducted a raid at Olivet on March 15.

“Investigators came to search for Newsweek servers and failed to find anything related to the search warrant,” Dover Greens CEO Marian Rebro said in a press release. “There was nothing to remove or to take pictures of because there was nothing on the campus related to their search.”

Rebro said that Dover Greens assisted the DA and his team in the search for the Newsweek servers. 

On Jan. 18, Vance and police had raided NMG’s downtown Manhattan offices and removed 18 computer servers. 

The DA’s office stressed the charges in the indictment are “merely allegations,” and stated the investigation is ongoing.

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