Investigations

On June 17, 2020, a criminal complaint issued by the U.S. District Court for the District of Rhode Island charged Michael Chaves, former owner of CAT Inc., a for-hire motor carrier transport company, with one count of wire fraud and one count of mail fraud. Chaves was arrested on the same date.

 

Chaves is currently on pretrial supervision as a result of charges stemming from a scheme to defraud the Federal Motor Carrier Safety Administration (FMCSA). Chaves’ pretrial release is based on the condition that he not commit another local, State, or Federal crime. Chaves was charged by information on July 24, 2019, and pled guilty to charges on August 22, 2019, in the same court.

 

On approximately March 31, 2020, while Chaves was on pretrial release, Amazon.com (Amazon) contacted investigators with information regarding an alleged ongoing fraud being perpetrated by Chaves. Amazon alleged that since March 2017, Chaves held approximately 30 Amazon customer accounts under various names and email addresses. Over this time period, Chaves’ accounts placed approximately 10,795 orders totaling approximately $713,970.78, most of which were refunded based on Chaves’ “return” of the items purchased. Chaves received approximately $643,324.04 in concessions or refunds on approximately 7,450 orders. In an attempt to deceive Amazon’s incoming inspection process, many of the returned items were in the original packaging. Amazon’s standard inspections process flagged approximately 149 of the returned items (from 10 different accounts belonging to Chaves) as potentially fraudulent, with an approximate value of $23,872.89.

 

The majority of Chaves’ purchases and returns consisted of motor vehicle and commercial motor vehicle parts. Allegedly, Chaves often replaced the originally ordered product with a substitute that at first glance appeared visually similar to the original, but instead was sometimes a used or inferior version. Amazon cannot guarantee that these used or unsellable items did not make it back into Amazon’s inventory.

 

DOT-OIG is conducting this investigation with Internal Revenue Service Criminal Investigation. East Providence Police Department assisted with the arrest.

 

Note: Indictments, informations, and criminal complaints are only accusations by the Government. All defendants are presumed innocent unless and until proven guilty.