FORMER SALES MANAGER SENTENCED TO 18 MONTHS IN PRISON FOR MAIL FRAUD

BIRMINGHAM, AL - TERENCE MURPHY, 59 of Uvalde, Texas, was sentenced by United States District Judge Karon O. Bowdre to 18 months in prison for mail fraud against his former employer, Packaging Corporation of America, Inc.

MURPHY, formerly of Tuscaloosa, Alabama, was also required to pay $199,728.15 in restitution, and was given 3 years supervised release after the prison term is served.  MURPHY was convicted on these charges on January 3, 2008.

From October 2005 through October 2006, MURPHY orchestrated a scheme with one of PCA’s customers, Belcher Lumber Sales, to sell lumber at a greatly reduced price to Belcher than he sold the same grade lumber to other PCA customers. MURPHY and Belcher then agreed to split the illegal profits 40% and 60% each on Belcher’s resale of the lumber. At MURPHY’S instructions, Belcher made out checks in the name of MURPHY’S wife, although the wife did not know about the scheme until later. MURPHY’S wife, Nancy Murphy, after learning about the scheme, lied to federal investigators that she had worked for Belcher and had earned the money. Nancy Murphy was also prosecuted for making a false statement to federal agents and was sentenced for her separate felony conviction last month in federal court.

 “High level employees within corporations who abuse their positions of trust for personal gain not only steal from their employers, but also put other honest businesses at risk because of their inability to compete fairly in a free market environment,” stated United States Attorney Alice H. Martin.  “The custodial sentence imposed by the Court was clearly in order. Without jail time there would have been no real consequences to his illegal conduct”

This case was investigated by the United States Postal Inspection Service and the Federal Bureau of Investigation and was prosecuted by Assistant United States Attorney Pat Meadows on behalf of the United States.