North Caldwell Man Admits To $550K ‘Soda Discount’ Fraud: Prosecutors

NORTH CALDWELL, NJ — A North Caldwell man admitted to fraudulently using more than $550,000 in investment funds that he promised to put to work purchasing and selling consumer products in bulk, including soda and bottled water, prosecutors announced Tuesday.

According to the U.S. Attorney’s Office (NJ), Michael Esposito, 45, pleaded guilty before U.S. District Judge William Martini in Newark federal court to an information charging him with one count of wire fraud.

According to court documents and statements, from August 2013 to February 2017, Esposito was the president of numerous entities that purported to purchase consumer products in bulk from manufacturers for resale to wholesalers and retailers.

Esposito said that he told potential investors that he could purchase consumer goods such as soda and bottled water at substantial discounts, and that he had buyers ready to purchase the products at a significant profit, prosecutors stated.

In return for providing the funds necessary to purchase the products, Esposito promised the victim investors a large percentage of the profits. However, Esposito admitted that he used the funds for his personal expenses and to pay other investors in order to make it appear the money was properly used, prosecutors said.

Esposito admitted that his actions resulted in losses of more than $550,000, prosecutors said.

Authorities said that the charge of wire fraud is punishable by a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Sentencing is set for July 20.

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