Two More Sentenced in Cobb-Based Counterfeit Money Scheme

By Kristal Dixon

A Woodstock man is one of two defendants who are now headed to federal prison for their role in printing counterfeit money in Marietta.

Heath J. Kellogg was sentenced on Friday, March 24 to 12 years in federal prison, which will be followed by three years of supervised release. 

Kellogg was convicted in November on one count of conspiracy to counterfeit and deal in counterfeit obligations of the United States, two counts of counterfeiting currency and two counts of dealing in counterfeit obligations.

The court found Kellogg responsible for "manufacturing counterfeit currency with a face value of over $1 million," the United States Attorney's Office said in a press release on Thursday. 

Fellow defendant Stacy P. Smith of Ellenwood was sentenced on Wednesday, March 26 to three years in federal prison, which will followed by three years of supervised release. 

Smith pleaded guilty in June 2013 to one count of counterfeiting obligations or securities of the United States. During the sentencing phase, Smith was also found to be responsible for manufacturing counterfeit currency with a face value of over $1 million.

"These defendants — who referred to their counterfeit money as ‘Monopoly,’ as if it were some kind of game—effectively stole from thousands of businesses, nonprofit organizations and citizens throughout Georgia and the United States," said United States Attorney Sally Quillian Yates. "Counterfeiting is far from a victimless crime because the person who unknowingly accepts the counterfeit bill usually absorbs the full amount of the loss.  In this case, the victims included citizens, churches, and family-run businesses, as well as banks and large retail stores."

From Feb. 1, 2011, to Nov. 15, 2012, the defendants drew up a plan to manufacture and distribute counterfeit U.S. money. They primarily focused their efforts on $50 bills, but also dabbled in manufacturing $20 bills. 

Kellogg, a self-taught graphic artist, developed the manufacturing process. Smith helped Kellogg along in the process, and both men on various occasion purchased supplies needed for their operation.

Smith distributed the counterfeit currency through a network of individuals, which ultimately spread the bills throughout the country. 

Smith and Kellogg used feedback from their ultimate customers, who passed along the counterfeit currency in their respective communities, to work out the kinks in their manufacturing process.

The defendants also sold their counterfeit currency to customers in exchange for genuine U.S currency, at various discounted rates.

On Nov. 15, 2012, U.S. Secret Service agents executed search warrants, which produced a variety of evidence such as completed and partially completed counterfeit currency, a large roll of special paper used in commercial printing presses, numerous printers and a flash drive containing encrypted digital files with high definition images of various features of the counterfeit bills. 

The Secret Service "reports that counterfeit currency matching the distinctive characteristics of those produced by the defendants totaling over $1.4 million in face value has been returned to it by local police departments, banks, merchants and individuals victimized when the counterfeit currency was passed."         

“Every person, business or organization that receives a counterfeit note is a victim, and as such experiences a real economic loss," said said Reginald G. Moore, special agent in charge of the United States Secret Service, Atlanta Field Office. "The United States Secret Service will continue to take an aggressive approach to arrest criminals like Smith and Kellogg. These sentences should be a warning to other like-minded criminals that manipulating and stealing from the American people will not go unpunished."

Four co-defendants in the same case were previously sentenced after pleading guilty:

• Kenyada Barrion, 37, of Lithonia was sentenced on August 28, 2013, to eighteen months in federal prison, to be followed by three years of supervised release. Barrion was convicted on March 27, 2013, of dealing in counterfeit obligations of the United States. 
• Cameron Longshore, 31, of Atlanta was sentenced on October 10, 2013, to one year and one day in federal prison, to be followed by three years of supervised release. He was convicted August 1, 2013, of a single count of dealing in counterfeit obligations. 
• Ian Longshore, 28, of Atlanta was also sentenced on October 10, 2013, to one year and one day in federal prison, to be followed by three years of supervised release. He was convicted on August 1, 2013, of a single count of dealing in counterfeit obligations. 
• James Kellogg, 63, of Marietta was sentenced on December 2, 2013, to five years of probation, including six months of home confinement. James Kellogg was convicted on June 11, 2013, of conspiracy to counterfeit and deal in counterfeit obligations of the United States.