Ex-Votenet Executives Indicted

Two former employees of Votenet Solutions Inc., a D.C.-based firm specializing in providing online political services and software, were indicted by federal grand jury last month for allegedly scheming to embezzle more than half a million dollars from the business.

Mitchell Reisberg, the former chief financial officer for Votenet, was arrested at his home in Cabin John, Md., five days before Christmas. A warrant has been issued for the arrest of Glen Hughlette, Votenet’s former president, chief executive officer and chairman of the company’s board of directors. Neither of the men is currently employed by the company, which also produces one of the most widely used Congressional directories, the U.S. Congress Handbook, and publishes Campaigns & Elections magazine.

Hughlette apparently left the Washington, D.C., area in 2003 and is a fugitive, according to the Justice Department.

Both men have been charged with multiple counts of wire fraud, interstate transportation of stolen property, bank fraud, mail fraud and first-degree fraud “in connection with their scheme to bilk Votenet Solutions, Incorporated, out of more than a half million dollars,” according to a press release from the United States Attorney’s office in Washington, D.C.

They both face up to 50 years in prison and a $500,000 fine.

The indictment alleges that Reisberg stole money from Votenet’s various bank accounts to pay personal expenses for himself and family members.

After being named CFO of Votenet Solutions in 2001, Reisberg obtained an ATM/debit card providing him access to Votenet’s SunTrust operating account, which he used as his own personal lush fund to buy jewelry, artwork, clothing, groceries, car services, plane tickets and ski equipment, according to a grand jury indictment.

“Throughout the course of the scheme, Reisberg would, in his capacity as Votenet CFO, write checks on Votenet’s various bank accounts in order to pay for unauthorized personal expenses unrelated to Votenet’s legitimate business,” the press release stated.

Hughlette, and Reisberg, would provide false financial statements to the company’s shareholders and outside accounts, the indictment alleged.

Additionally, Reisberg is accused of transferring thousands of dollars designated for charities such as the National Cancer Research Foundation and America’s Second Harvest to Votenet’s operating accounts to conceal his embezzlement of Votenet funds.

Court records show that America’s Second Harvest, a Chicago-based nonprofit hunger relief organization, sued Votenet Solutions, Hughlette and Reisberg in February 2003.

The nonprofit was collecting contributions through Votenet’s online fundraising services software and claimed the company had failed to forward more than $226,000 in contributions made to the group. America’s Second Harvest claimed an additional $5 million in punitive damages, but ultimately dropped its case against Votenet.

Court documents from that case show that both Hughlette and Reisberg were terminated from Votenet Solutions around May 2003.

Reisberg has also been accused of diverting contributions from employee’s 401(k) accounts and employee payroll taxes to Votenet’s operating accounts in another apparent effort to cover his alleged embezzlement

Last year, Reisberg and Hughlette were sued by the Labor Department for failing to forward employee 401(k) contributions to Votenet’s company retirement plan.

The suit alleged that the duo had violated the Employee Retirement Income Security Act by failing to collect employee contributions owed to the plan between November 2000 and March 2002, according to a Labor Department press release.

Tony Axam, the federal public defender representing Reisberg, did not respond to a request for comment.

According to a 2000 article on dc.internet.com, Hughlette joined Votenet Solutions as president and CEO in August 2000. Before that, he co-founded and spent 10 years as president of Information Engineering Systems Corp. He also spent six years at the Information Technology Association of America, as the vice president, corporate secretary and chief financial officer.

Between 2000 and 2003, he was a frequent expert speaker on panels at public forums devoted to political innovations and the Internet.

Hughlette’s whereabouts are unknown.

Votenet solutions, meanwhile, boasts of hundreds of clients in all 50 states and Europe including leading associations, universities, political and advocacy groups, unions and corporations.

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