Maryland State Wire

Today, U.S. District Judge Deborah K. Chasanow sentenced Eugene Andrew DiNoto, 54, of Bel Air, Maryland, to federal prison for his involvement in a $29 million embezzlement and kickback scheme. DiNoto received concurrent sentences of 70 months for conspiracy to commit wire fraud and engaging in an illegal monetary transaction and 64 months for tax evasion, followed by three years of supervised release.

The sentence was announced by Kelly O. Hayes, U.S. Attorney for the District of Maryland, alongside Acting Special Agent in Charge Amanda M. Koldjeski from the FBI's Baltimore Field Office and Special Agent in Charge Kareem A. Carter from the IRS-CI's Washington Field Office.

DiNoto, a longtime employee of Company 1 with facilities in Harford County, Maryland, began exploiting his management position in 2012 with another employee, Elliott Kleinman. They engaged in a fraudulent billing scheme involving illegal kickbacks from drum vendors supplying Company 1.

Anthony P. Urcioli Sr., owner of Tunnel Barrel & Drum Co., Inc., and Hartford Fibre Drum Inc., participated in the scheme by agreeing to fraudulently invoice Company 1 for undelivered drums and share the proceeds with DiNoto.

From January 2012 to January 2020, DiNoto orchestrated false invoices totaling over $20 million with TBD and Hartford keeping half while he and Kleinman received the remainder. His personal gain amounted to approximately $7 million.

The scheme resulted in a loss of nearly $29.5 million to Company 1. Additionally, DiNoto failed to report over $7 million as income on his tax returns between 2017 and 2019, causing a loss of approximately $1.37 million to the U.S. government.

Kleinman previously received a sentence of 42 months imprisonment while Urcioli was sentenced to time served plus supervised release; both were ordered to pay restitution exceeding $19 million.

U.S. Attorney Hayes praised the efforts of the FBI and IRS-CI during this investigation and acknowledged Assistant U.S. Attorneys Harry M. Gruber and Joseph L. Wenner who prosecuted the case.

For further details about the Maryland U.S. Attorney’s Office or resources available for reporting fraud visit justice.gov/usao-md or justice.gov/usao-md/report-fraud.