A federal grand jury has indicted a former executive of an Indiana-based trucking company, alleging he defrauded his employer of nearly $14 million and used the funds to buy a horse farm, Rolex watches and several luxury cars.
Daniel R. Fruits, 46, of Greenwood, Indiana, was charged with 10 counts of wire fraud, six counts of money laundering, two counts of making false statements to a federally insured bank and one count of mail fraud, according to a grand jury indictment filed in U.S. District Court for the Southern District of Indiana.
Court documents said a Kentucky investor, David Kloiber, founded a trucking company, Secure Transit LLC, in 2015 and hired Fruits to run it. Kloiber invested approximately $14 million in the business over the next four-and-a-half years with money held in the Daniel Kloiber Dynasty Trust.
Federal prosecutors allege Fruits spent most of the investor’s money on his own personal purchases and payments, including approximately $880,000 to buy a home and horse farm, $560,000 for an RV and trailer, and over $111,000 on a Corvette. The purchases also included $90,000 for three Rolex watches, $55,000 for a horse, $33,000 for a horse trailer, $23,000 on payments for two Ferraris, and $30,000 for two escorts.
During that time, prosecutors claim Fruits repeatedly lied about the trucking company’s financial health, who its customers were and what the invested money was being used for, according to court documents.
“On multiple occasions, Fruits allegedly sent the investor fictitious customer sales contracts and falsified financial statements that reported inflated company profits,” the U.S. attorney’s office said in a statement. “At the same time, Fruits allegedly asked the investor for additional investments, sometimes in the millions of dollars, purportedly for the purchase of trucks or other business expenses.”
In May 2019, Fruits requested a $1.45 million short-term investment from Kloiber so he could pay deposits toward the purchase of 145 new trucks to grow Secure Transit’s trucking fleet, according to court filings. Secure Transit later received a wire transfer from Kloiber for $1.5 million.
A month later, Fruits’ employment with Secure Transit was terminated.
During the same period in which Fruits allegedly defrauded Kloiber, the indictment claims he was also involved in a vehicle title-washing scheme to remove a bank’s lien from the title of a truck he purchased.
According to the indictment, Fruits sent a fake letter to the Indiana Bureau of Motor Vehicles — claiming to be from Ally Financial, which had a lien on a truck he purchased — falsely claiming he had paid off a $69,000 loan.
Fruits later sold the truck without repaying the bank, according to the U.S. attorney’s office.
Prosecutors claim Fruits attempted to perpetrate a mortgage fraud scheme on Fifth Third Bank. Specifically, in late 2018, Fruits made false statements to Fifth Third Bank to secure a $432,000 mortgage. He twice submitted falsified paperwork purporting to show that loans from another bank had been paid off when they had not been.
According to the Federal Motor Carrier Safety Administration, Secure Transit is no longer operating. In August 2019, Secure Transit filed for Chapter 7 bankruptcy protection. In its petition, the carrier listed assets of up to $50,000 and its liabilities as between $10 million and $50 million.
Ex-recruiter accused of embezzling $121,000 from two trucking companies
Trucking company owner indicted in PPP loan fraud, Ponzi scheme
Feds urge appeals court to reconsider ruling in Pilot fraud case
Ex-payroll clerk accused of swiping funds from trucking company