The former chief executive of a Bay Area imaging technology company has been convicted in a $2.6 million fraud scheme, the Department of Justice announced recently.
During his tenure as CEO, Lawrence Gerrans reportedly funneled millions away from his San Rafael-based company to purchase everything from a Maserati to spa treatments. In 2017, the 49-year-old racked thousands on the company credit card, including more than $12,000 for high-end carpets and another $44,000 for a vacation timeshare.
“The defendant siphoned millions of dollars from the medical device company he was entrusted to run, and then tried to cover up that crime,” U.S. Attorney David Anderson said in a DOJ statement. “Insider schemes like these injure companies, employees and investors, and undermine the public’s trust in our business community.”
Following a two-week trial, a federal journey found Gerrans guilty of numerous counts on Jan. 29. Those included wire fraud, making false statements to a government agency, contempt of court and witness tampering.
During the first three months of 2015 alone, the former exec systematically transferred more than $2.6 million away from the firm and into the accounts of shell companies he controlled. He then laundered those funds and later used them for an all-cash purchase of a luxury home in San Anselmo, California.
In another instance, Gerrans liquidated a retirement account and told his board of directors he reinvested the funds into Sanovas. Instead, he funneled the money into his own pockets to buy a Maserati, diamond ring and pay rent on a property.
A judge set sentencing for May 20, 2020, with Gerrans potentially facing decades in prison and hundreds of thousands of dollars in fines, according to the DOJ.
Founded in 2009, Sanovas is a technology startup that specializes in producing minimally invasive medical imaging devices to treat lung cancer.
Marty Stempniak has covered healthcare since 2012, with his byline appearing in the American Hospital Association's member magazine, Modern Healthcare and McKnight's. Prior to that, he wrote about village government and local business for his hometown newspaper in Oak Park, Illinois. He won a Peter Lisagor and Gold EXCEL awards in 2017 for his coverage of the opioid epidemic.