- The Washington Times - Tuesday, January 17, 2006

The former head of a D.C. security company that held millions of dollars in federal and D.C. contracts pleaded guilty yesterday to diverting more than $370,000 from a payroll account to fund his side job as a boxing promoter.

Jeffrey N. Jackson, co-founder of Unlimited Security Inc. and one-time promoter for former heavyweight champion Riddick Bowe, will likely face 24 to 30 months in prison when he sentenced Aug. 10, federal prosecutors said. He pleaded guilty to one count of bankruptcy fraud and has agreed to make restitution.

The Washington Times first reported on the company’s questionable expenses and financial troubles last year.

Unlimited Security collapsed into liquidation last year. The family-run company had held assignments to guard FBI, U.S. Transportation Department and D.C. government buildings in the District and facilities in at least four states. The company employed hundreds of guards.

Assistant U.S. Attorney Daniel P. Butler said Jackson diverted $373,429 from Unlimited bank accounts in 2003 “for his personal use, primarily for the funding of a private professional boxing promotion business.”

Charging documents show $110,000 was paid to an unnamed boxer. The Times reported that $110,000 of the diverted money ended up in the hands of Ernest Mateen of Palm Beach, Fla., who was charged in 2004 with running a scam in which he posed as a boxer.

The money was advanced to Unlimited from its financier, Commerce Funding Corp., and was to have been “used solely to pay Unlimited Security’s payroll, including payroll taxes,” Mr. Butler said.

Jackson declined to comment yesterday.

“Mr. Jackson made a mistake, and he’s trying to make amends for it,” his attorney, G. Allen Dale, said after the plea hearing before Judge Ricardo M. Urbina in U.S. District Court in the District. “Good people make mistakes.”

A complication that surfaced yesterday could affect the length of Jackson’s prison sentence.

Judge Urbina cited a letter in which a private investigator said a check she had received for work performed for Jackson through a company called Innovative Security had bounced and she has been unable to collect on the debt.

Judge Urbina called the letter “significant,” saying he would take it into consideration if the dispute isn’t resolved by the time Jackson is sentenced in August.

Jackson remains free pending sentencing.

Jackson told the judge he is working 16 hours a day as a consultant for Innovative Security, where his duties include helping obtain contract work for the company.

He has been barred from competing for federal contracts but remains eligible for D.C. contract work.

He remains entangled in several civil lawsuits filed in Unlimited’s demise, including separate claims for millions of dollars each filed by Mr. Bowe and by Commerce Funding.

Jackson met Mr. Bowe in 1999 through the boxer’s nephew, who worked for Unlimited.

Mr. Bowe, who filed for bankruptcy last year, has said he never was repaid a $2 million loan he gave to the company in 2000 and he was conned into backing a line of credit from Commerce Funding to Unlimited, court records show.

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