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USA v.
Michael Paul Riebe

Case Nos.: 1:17CR14
Sentencing Memorandum
IN THE UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF VIRGINIA
ABINGDON DIVISION
UNITED STATES
v. Case Number: 1:17CR14-001-JPJ-PMS
MICHAEL PAUL RIEBE
DEFENSE SENTENCING MEMORANDUM
Comes now the Defendant, Michael Paul Riebe, by Counsel, and files his
Sentencing Memorandum.
18 U.S.C. §3553 FACTORS
ü The Nature and Circumstances of the Offense & the History &
Characteristics of the Defendant
On October 22, 2014, the Holding Funeral Home in Castlewood was
destroyed by fire. Riebe had a property interest in the building and the business at
the time of the fire, along with Blake Wilson, his father-in-law. The Six Count
Indictment alleging fraud is based upon the theory that Riebe engaged in a scheme
to defraud Harleysville Insurance Company with false claims related to personal
property.
Wilson has been operating or has been employed with multiple funeral
homes in Southwest Virginia for nearly fifty years, and all that time without any
hint of criminal activity.
Case 1:17-cr-00014-JPJ-PMS Document 65 Filed 04/16/18 Page 1 of 11 Pageid#: 223

USA v. Michael Paul Riebe
Case Nos.: 1:17CR14
Riebe is originally from Alabama. He moved to Virginia when he was 18
years of age, and began dating Wilson’s daughter, Laura. They married and now
reside in Big Stone Gap. They have a large family that depends almost entirely
upon Mike for their financial needs.
The RCSO decided immediately and prematurely and without good cause
that Riebe was involved with the arson of the building, in large part because the
insurance coverage was increased substantially just before the fire. The RCSO
theorized that Riebe had increased the coverage and then burned the building in
hopes of getting a large insurance settlement, which would have paid off the debt
associated with the business. Agents of the RCSO appeared at the insurance
agent’s office the day of the fire and sought records related to the coverage of the
business provided by Harleysville. The large increase in coverage and the
erroneous belief that the increase was initiated by Riebe fueled the arson
investigation, and Riebe became their prime target.
The truth about the insurance coverage adjustment was not discovered until
the insurance agent gave testimony before the Grand Jury on July 11, 2016. And
the truth was this: In early 2014, Harleysville requested the insurance agent to
increase the coverage with the owners’ consent so that Harleysville could receive a
bigger premium. The increase in coverage was not the result of any act on the part
of Riebe or Wilson. The business had multiple policies that were managed by the
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Case Nos.: 1:17CR14
agent, and many of them were amended pursuant to the custom and practice of the
industry. Further, the investigation revealed that Holding Funeral Home had just
purchased the property in Castlewood and had spent a large amount of money to
renovate the funeral home and to provide rental units. It certainly defies reason that
one would spend hundreds of thousands of dollars and hundreds of hours in sweat
equity just to burn it down. Despite having no income because of the fire, Riebe
and Wilson continued to make mortgage payments for almost 2 years.
Additionally, the investigation continued to improperly target Riebe after
Harleysville provided an enhanced video that showed a vehicle arriving at the front
of the funeral home in the early morning hours and then depart after only a few
minutes. The building was on fire shortly after the vehicle left. The enhanced
video revealed that the vehicle that stopped shortly before the fire was a lightly
colored vehicle. The unenhanced original video no longer exists. Harleysville has
been unable to explain how or why the original video no longer exists.
Since Riebe owned a white sedan, the enhanced video from Harleysville
provided ammunition to RCSO that Riebe must have been the arsonist.
Presumably, the RCSO concluded that Riebe is the only person with a light colored
vehicle in or around Castlewood. That theory became debunked after Counsel for
Riebe informed the investigation that the suspect vehicle fled in a direction toward
Abingdon and away from Big Stone Gap. Telephone tower records indicate that
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Case Nos.: 1:17CR14
Riebe was at home when he was notified of the fire about 30 minutes later. It is far
fetched that anyone without a blue light could possibly travel from Castlewood to
Big Stone Gap in such a short amount of time when the route takes you through
Castlewood to Dungannon to Coeburn to Norton to Big Stone Gap.
Eventually, the Government informed the Grand Jury that there would be no
Indictment presented against Riebe for the arson of the building. At least that
decision was reached correctly.
Of course that did not end the matter. The Government then turned its focus
on whether Riebe had committed fraud in the submission of claims for the loss of
personal property occasioned by the fire.
The Grand Jury was never informed that Harleysville had misled the insured
about the amount of coverage available to pay on the claim. Harleysville had
agreed to settle with the insured for policy limits, and then changed its mind when
they realized that the amount of coverage was greater than they originally thought.
In April 2017, the Grand Jury returned a Six Count Indictment that alleged
various acts of fraud by Riebe to pursue the business personal property claim.
The Government has categorized the fraud claims into two (2) categories:
(1) items that were claimed had a value greater than the actual value of the item;
(2) items were claimed that were not destroyed in the fire.

Case Nos.: 1:17CR14
A review of the discovery from the Government reveals a lack of
understanding of the nature of the policy and the accepted practices of negotiating
a commercial fire claim where the contents of the structure are either totally
destroyed by the fire or they are so destroyed that repairing the item is not possible.
The Government obviously does not appreciate the nature of a Replacement Cost
Value (RCV) Policy versus an Actual Cost Value (ACV)Policy.
Andy Macleay attempted to explain the nature of these type of claims to the
Government. Macleay is employed by GGG, Inc. to assist insureds with large
commercial claims such as the one involved in this matter. Because the policy
issued by Harleysville was an RCV policy, the fair market value of the item
destroyed is of no consequence if the insured wants RCV. The actual value of the
item at the time of the fire is not the measure of damages. For example, if a 5 year
television that was purchased for $1,000 in 2013 was totally destroyed in the fire
and it had a depreciated value of $200, then the policy allowed the insurer to
replace that television with a new television regardless of the depreciated value. In
this case, Riebe gets to have a new TV BUT he has to purchase the new TV. He
does not get the money if he wants RCV to spend as he chooses. He only gets the
money if the money is used to purchase the item. He can take less if he only wants
the ACV of the item. In this case, the Government claims that Riebe committed
fraud because the values on the BPPC exceeded the actual value of the item. The
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Case Nos.: 1:17CR14
Government fails to acknowledge/appreciate that the policy in question is an RCV
policy. The Government also fails to understand that the values of many of the
items on BPPC were assigned replacement values by Macleay’s firm. They are
experienced in this field and are considered experts in providing valuations for
items destroyed in a fire. In short, the manner that this claim was presented by
Holding Funeral Home with the assistance of Macleay and his firm was done so
without any hint of fraud and in accordance with accepted practices in the industry.
During pre-trial discussions, the Government appeared to be unaware of the
nature of the policy at issue. For example, they seemed to be particularly impressed
that GGG had valued two men’s suits using an accepted practice to do so, when the
Grand Jury testimony from one of the employees indicated that the costs of these
two suits was nominal. However, the insured paid a hefty premium for RCV Policy
and if the funeral home wanted to spend retail prices on two men’s suits, that was
wholly consistent with the policy terms.
The Government alleges some items were presented that were claimed but
were allegedly not destroyed in the fire. Almost every allegedly missing item is
either visible in photographs of the fire scene or their existence is clearly proven by
independent evidence. As an example of the debunking of the Government’s case,
a letter from C. Thomas Brown is attached that illustrates and establishes the
Government’s theory of criminal liability is without merit.

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Case Nos.: 1:17CR14
The claims process with Harleysville had not even concluded when civil
litigation began. Harleysville had not paid any moneys to the insured at that time,
and has still not paid any moneys to the insured.
In September 2017, the Government advised Riebe that if he was not willing
to plead guilty to a felony then the Government would then elect to proceed against
Riebe and his wife, Laura, for arson, and also to proceed against his 77 year old
father-in-law for fraud. Until that moment, Riebe steadfastly maintained that he
was innocent of any fraud or arson. Within a short period of time after being
informed of the potential future felony charges against Blake Wilson and Laura
Riebe, Counsel for Riebe advised the Government that Riebe possibly could be
persuaded to enter a Plea of Guilty to a violation of 18 USC §2232. There was
much negotiation as to the wording of the facts that would support such a violation.
The end result was that Riebe plead guilty to a violation of 18 USC 2232.
This is not a resolution that he envisioned. However, his decision protects his
family from future prosecution, and it allows the civil claims against Harleysville
to continue.
Should the Court accept the agreement, Counsel for Riebe has attached three
letters that are in support of a sentence of probation which is within the range
contemplated by the agreement.

Case Nos.: 1:17CR14
The PSR reflects that Riebe has always maintained steady employment and
provided voluntary community services. See also the Attached letters which
provide the Court with insight into Michael Riebe and his 13 years in Southwest
Virginia since moving here as an 18 year old teenager from Alabama.
Riebe and Laura have two children of their own, ages 8 and 6; three children
from a previous marriage of Laura, ages 21, 18 and 15 (two of whom still reside
with the Riebes) and two children, ages 3 and 4, whom they are in the process of
adopting. The Riebes have 6 minor children which they are raising in their home.
ü The Need For the Sentence Imposed
Great effort was taken to agree on a set of facts that would show minimal
criminal conduct of Riebe. The PSR offense level is high. However, it probably
presumes criminal conduct that is much more severe and obstructing. In this case,
Riebe did not hide the fact that he owned a light colored car. He was unaware that
there was any video of any vehicle until much later. While the sell of the car may
have prevented law enforcement from searching it, it is not clear whether any
search would have ever been done.
The PSR indicates that there is no victim of the offense.
Any punishment in a criminal setting provides some measure of deterrence.
It is unlikely that incarceration for Riebe based on the facts before the Court would
serve any particular deterrence.

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Case Nos.: 1:17CR14
The public is not going to be offended by a sentence of probation. There has
been no public outcries against Riebe.
Riebe is not in need of treatment as contemplated in §3553 (2) (D).
ü The Kinds of Sentences Available & The Sentencing Range
The sentencing guideline range in this case has been stipulated by the
defense and the United States to be 0 to 6 months pursuant to Federal Rule of
Criminal Procedure 11(c)(1)(C) which places Riebe in Zone A on the Sentencing
Guidelines Table. The defense and Government agree that this is an appropriate
guideline range for the unique circumstances of this case and this Defendant.
CONCLUSION
Should the Court accept the Plea Agreement, the appropriate criminal
punishment is probation with a minimal period of supervised release.
Riebe has paid a sizeable fine. His licenses to continue practicing in the
mortuary field could be in jeopardy. Any criminal conviction is satisfactory to the
Government. Incarceration is obviously not an issue for the Government.

Case Nos.: 1:17CR14
Respectfully Submitted,
MICHAEL PAUL RIEBE

BY COUNSEL
/s/ Timothy W. McAfee

Timothy W. McAfee
Virginia State Bar #: 21779
Tennessee BOPR #: 020590
Attorney for: Michael Paul Riebe
408 Wood Avenue
P.O. Box 610
Big Stone Gap, VA 24219
Telephone: (276) 523-5300
Fax: (540) 301-5777
E-mail: tmcafee@timothymcafee.com
Richard D. Kennedy
Richard D. Kennedy
529 West Main Street
P.O. Box 357
Wise, Virginia 24293
Telephone: 276-328-0918
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Case Nos.: 1:17CR14
CERTIFICATE OF SERVICE
I, Timothy W. McAfee, do hereby certify that I have electronically filed the
foregoing Sentencing Memorandum with the Clerk of the Court using the CM/ECF
system which will send notification of such filing to all parties of record on April 16,
2018.
/S/ Timothy W. McAfee

Timothy W. McAfee
Virginia State Bar #: 21779
Tennessee BOPR #: 020590
408 Wood Avenue
P.O. Box 610
Big Stone Gap, VA 24219
Telephone: (276) 523-5300
Fax: (540) 301-5777
E-mail: tmcafee@timothymcafee.com
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Case 1:17-cr-00014-JPJ-PMS Document 65-1 Filed 04/16/18 Page 1 of 8 Pageid#: 234

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USA v.

Michael Paul Riebe

IN THE UNITED STATES DISTRICT COURT

v. Case Number: 1:17CR14-001-JPJ-PMS

MICHAEL PAUL RIEBE

DEFENSE SENTENCING MEMORANDUM

18 U.S.C. §3553 FACTORS

Characteristics of the Defendant

On October 22, 2014, the Holding Funeral Home in Castlewood was

to defraud Harleysville Insurance Company with false claims related to personal

hint of criminal activity.

Case 1:17-cr-00014-JPJ-PMS Document 65 Filed 04/16/18 Page 1 of 11 Pageid#: 223

Riebe is originally from Alabama. He moved to Virginia when he was 18

upon Mike for their financial needs.

business provided by Harleysville. The large increase in coverage and the

investigation, and Riebe became their prime target.

Case 1:17-cr-00014-JPJ-PMS Document 65 Filed 04/16/18 Page 2 of 11 Pageid#: 224

and Wilson continued to make mortgage payments for almost 2 years.

Additionally, the investigation continued to improperly target Riebe after

Case 1:17-cr-00014-JPJ-PMS Document 65 Filed 04/16/18 Page 3 of 11 Pageid#: 225

Castlewood to Dungannon to Coeburn to Norton to Big Stone Gap.

decision was reached correctly.

personal property occasioned by the fire.

Case 1:17-cr-00014-JPJ-PMS Document 65 Filed 04/16/18 Page 4 of 11 Pageid#: 226

A review of the discovery from the Government reveals a lack of

Value (RCV) Policy versus an Actual Cost Value (ACV)Policy.

Government. Macleay is employed by GGG, Inc. to assist insureds with large

Case 1:17-cr-00014-JPJ-PMS Document 65 Filed 04/16/18 Page 5 of 11 Pageid#: 227

Government fails to acknowledge/appreciate that the policy in question is an RCV

During pre-trial discussions, the Government appeared to be unaware of the

wholly consistent with the policy terms.

independent evidence. As an example of the debunking of the Government’s case,

Government’s theory of criminal liability is without merit.

Case 1:17-cr-00014-JPJ-PMS Document 65 Filed 04/16/18 Page 6 of 11 Pageid#: 228

and has still not paid any moneys to the insured.

persuaded to enter a Plea of Guilty to a violation of 18 USC §2232. There was

contemplated by the agreement.

Case 1:17-cr-00014-JPJ-PMS Document 65 Filed 04/16/18 Page 7 of 11 Pageid#: 229

Virginia since moving here as an 18 year old teenager from Alabama.

ü The Need For the Sentence Imposed

search would have ever been done.

The PSR indicates that there is no victim of the offense.

Any punishment in a criminal setting provides some measure of deterrence.

serve any particular deterrence.

Case 1:17-cr-00014-JPJ-PMS Document 65 Filed 04/16/18 Page 8 of 11 Pageid#: 230

The public is not going to be offended by a sentence of probation. There has

been no public outcries against Riebe.

Riebe is not in need of treatment as contemplated in §3553 (2) (D).

ü The Kinds of Sentences Available & The Sentencing Range

defense and the United States to be 0 to 6 months pursuant to Federal Rule of

Criminal Procedure 11(c)(1)(C) which places Riebe in Zone A on the Sentencing

punishment is probation with a minimal period of supervised release.

mortuary field could be in jeopardy. Any criminal conviction is satisfactory to the

Government. Incarceration is obviously not an issue for the Government.

Case 1:17-cr-00014-JPJ-PMS Document 65 Filed 04/16/18 Page 9 of 11 Pageid#: 231

MICHAEL PAUL RIEBE

/s/ Timothy W. McAfee

Case 1:17-cr-00014-JPJ-PMS Document 65 Filed 04/16/18 Page 10 of 11 Pageid#: 232

I, Timothy W. McAfee, do hereby certify that I have electronically filed the

/S/ Timothy W. McAfee

Case 1:17-cr-00014-JPJ-PMS Document 65 Filed 04/16/18 Page 11 of 11 Pageid#: 233

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