East Bay woman gets prison for embezzling $1.7M from Men's Wearhouse
DANVILLE – A woman from Danville was sentenced to 22 months in federal prison for embezzling over $1.7 million from Men's Wearhouse and its parent company Tailored Brands, federal prosecutors said this week.
Gina Suzanne Lonestar, a former Men's Wearhouse employee, pleaded guilty to one count of wire fraud, according to the U.S. Attorney's Office for the Northern District of California.
Lonestar, 52, admitted that in December 2010, she devised a plan to create a fake vendor to defraud Men's Wearhouse and Tailored Brands of money by submitting and approving false invoices for the fake vendor, prosecutors said.
She fabricated a document claiming the vendor was a sole proprietorship linked to a family member. She then began submitting and approving invoices, falsely stating the vendor was operating at Men's Wearhouse stores in California, such as inspections and handyman work, according to the U.S. Attorney's Office.
Lonestar admitted that she approved false invoices in the name of the fake vendor for approximately eight years, defrauding the apparel giant of over $1.7 million, which was deposited to her bank account. She also admitted that the family member with whom she supposedly co-owned the company performed none of the work for which she provided invoices, prosecutors said.
Lonestar served as a senior director of Men's Wearhouse's facilities department and vice president of the retailer's construction and maintenance division. She was director of the facilities department when she devised her scheme, prosecutors said.
Lonestar's scheme ended in 2019 when the company discovered the conduct during an internal audit. She was authorized to approve invoices for work done by vendors the whole time she worked for Men's Wearhouse, according to the U.S. Attorney's Office.
In September 2022, a federal grand jury indicted Lonestar, charging her with six counts of wire fraud. But due to her plea agreement, she pleaded guilty to one count and the court dismissed the remaining counts during her sentencing hearing.
Besides her prison time, Lonestar is ordered to pay $1,736,216 and to serve three years of supervised release, which will start after she leaves prison, prosecutors said. On Dec. 1, there will be a hearing to determine issues on restitution regarding the verdict.
Lonestar will begin serving her sentence on Jan. 5, 2024, according to the U.S. Attorney's Office.