Arizona scammer with Marion County tie gets 20 years in prison

Steven Dale Audette
Steven Dale Audette
photo Steven Dale Audette
photo Mary Roach

A Minnesota man with Marion County, Tenn., ties was sentenced in Arizona to 20 years in federal prison in an extortion scheme that spanned two decades and five states and netted $3.5 million from people who had only the best intentions.

Steve Dale Audette, 59, was found guilty by a federal jury in March 2016. His wife, Mary Roach, pleaded guilty earlier and was sentenced to three years.

According to trial testimony, Audette and Roach bilked three Scottsdale, Ariz., residents by "falsely representing that Audette was on the run from the [M]afia and needed funds to pay the CIA and FBI for protection," according to a release from the U.S. Attorney's Office in Phoenix, Ariz.

Audette told the victims he was the son of infamous mob boss Lucky Luciano and was likely to "inherit a lot of money."

The two primary victims were identified in court records only as a man, S.W., and a woman, L.M.

The Times Free Press reported on an initial appearance by Audette and Roach in U.S. District Court in Chattanooga back in 2014. They were arrested on charges of wire fraud after an investigation by the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives, the Marion County Sheriff's Office and numerous other agencies.

Marion County Sheriff's Office detective Chad Johnson said Friday the federal case arose from a 2011 drug investigation. He said a Laredo, Texas, man named named Julio Barbosa was supplying marijuana to Whitwell resident Jack Morrison.

Barbosa and Morrison were convicted in the marijuana case and sentenced in 2013, Johnson said, but it was Barbosa's brother-in-law in South Pittsburg, Ricky Roach, who led to the discovery of the fraud case.

"When I looked into Roach I found that Roach had previously been investigated for smuggling marijuana across the Mexican border," Johnson said.

He said Roach's bank records showed that between Dec. 29, 2010, and March 31, 2011, Roach received 15 wire transfers totaling $94,390 into his account at Citizens Tri-County Bank in South Pittsburg, from the account of [L.M.] at Sunrise Bank of Arizona in Phoenix.

Investigators thought L.M. was laundering drug money, Johnson said, "so we began to investigate her and found she had sent millions of dollars to people who were associated with Roach."

They eventually learned Mary and Rickey were brother and sister, and the couple were living in Tennessee when he was getting the money from L.M.

Court documents and records lay out Audette's and Mary Roach's scam, which prosecutors say had gone on for 20 years.

After graduating from chiropractic school in Minnesota in the late 1980s, Audette called S.W, a former classmate, and asked for a loan. Then came more, larger loans, and a story that began to grow more threatening.

Audette told S.W. he was participating in a secret CIA investigation and that the S.W.'s family "would be in danger" if the flow of money stopped.

In 2002, S.W. asked a wealthy patient, L.M., if she would help out. At first she gave S.W. money to pass along. Then Audette told her the same story and promised she would be repaid when the secret investigation was over.

But Audette became threatening, telling L.M. that "if the [M]afia showed up at her house, her grandchildren would be harmed or murdered," records state. L.M. was told not to tell anyone, even law enforcement, or "people would end up dead."

Audette gave L.M. the names of five people - he described them as government agents - to whom to send the money. To press her, Audette sent threatening text messages and called her repeatedly.

Between 2002 and 2013, L.M. sent more than $1 million to Audette before she ran out of money.

Ricky Roach was one of the pass-through account holders receiving L.M.'s money, the Times Free Press reported in 2014.

Mary Roach told investigators L.M. was loaning money for her daughter's hair salon in Laredo, Texas. At the same time, Audette told investigators the same tale he spun for S.W. and L.M. about Mafia hit men and secret government investigations.

According to U.S. Attorney's Office officials, the victim's money was spent on cars, travel, homes, gifts to family and friends, and personal items.

Contact staff writer Ben Benton at bbenton@timesfreepress.com or 423-757-6569.

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