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Second 5 LINX defendant considering plea deal

By: Bennett Loudon//June 18, 2018

Second 5 LINX defendant considering plea deal

By: Bennett Loudon//June 18, 2018//

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Another defendant in the 5 LINX fraud case is considering a plea agreement offered by federal prosecutors.

Craig Jerabeck, left, and Jeb Tyler
Craig Jerabeck, left, and Jeb Tyler

Jeb Tyler, a former 5 LINX vice president, is scheduled to be in U.S. District Court on Wednesday before U.S. Magistrate David G. Larimer.

“There has been an offer made to us that we are considering,” Tyler’s attorney, Matthew Parrinello said Monday.

“I’m not 100 percent sure what will happen on Wednesday. There’s a possibility of not much. There’s a possibility of a plea. We’re kind of going over our various options at this point,” said Parrinello, who would not reveal the actual plea agreement offered by the U.S. Attorney’s Office.

Tyler is facing a maximum sentence of 20 years in prison if convicted of all the charges.

Tyler was charged with co-defendants Craig Jerabeck and Jason Guck of defrauding 5LINX, a multi-level marketing company they founded out of millions of dollars

Jerabeck, 57, pleaded guilty in May to conspiracy to commit wire fraud and filing a false tax return. He is facing a maximum penalty of 20 years in prison and a fine of $250,000.

In 2001, Jerabeck started 5LINX Enterprise Inc. with Tyler and Guck. The company offered utility and telecommunications services, health insurance, nutritional supplements, and business services.

5LINX used independent representatives to sell products and services, and to recruit new representatives.

Jerabeck was president and chief executive officer. Guck was vice president and secretary, And Tyler was also a vice president.

In June 2006 and July 2006, Jerabeck, Tyler and Guck sold 5LINX stock for $5.5 million to three investment companies: Trillium Lakefront Partners III L.P.; Trillium Lakefront Partners III, NY L.P.; and Shalam Investment Co. L.L.C., according to the U.S. Attorney’s Office.

Between May 2010 and April 2016, 5LINX sold and distributed products for a Florida vendor. As part of his plea agreement, Jarabeck admitted that he, together with Guck and Tyler, got about $2.3 million from the Florida vendor, which the 5LINX investors, board of directors and stock holders didn’t know about.

Jerabeck also admitted that he, Guck, and Tyler were each prohibited from receiving such money by their stockholders agreements. The investors, creditors and stockholders should have gotten the money, according to the U.S. Attorney’s Office.

Also, for the years 2011 through 2013, and 2015, Jerabeck did not report income he received from 5LINX, and he took deductions to which he was not entitled and avoided paying $118,628 in tax.

Jerabeck agreed to forfeit his interest in real property at 90 East Lake Road in Yates County.

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