John O'Brien - Syracuse.com
WATERTOWN, N.Y. -- Federal agents have seized the Jreck Subs corporation and its bank accounts as its owner awaits sentencing for fraud, according to WWNY-TV in Watertown.
The U.S. Marshals Service seized the company operated by Christopher Swartz, the report said.
Swartz, 47, pleaded guilty last year to defrauding investors out of at least $9 million.
Swartz has owned the Jreck franchise since at least 2002, according to court records. His business is separate from the Jreck Subs shops operated by independent franchisees who are not involved in the case, a federal agent wrote in an affidavit.
Swartz owns the intellectual property rights to the Jreck brand and the royalty payments from more than 40 stores, the affidavit said. Agents estimated the franchise's value at $2.5 million, with annual net profits of $400,000, the affidavit said.
Peter Whitmore of Watertown, who owns multiple Jreck stores, will oversee the corporation until the Marshals Service sells the company, the agency told WWNY.
Swartz, 47, of Watertown, pleaded guilty last year to defrauding lenders and investors in his food and restaurant franchises with false representations. He defrauded at least 10 people out of between $9.5 million and $25 million, according to federal prosecutors.
As part of his guilty plea, Swartz agreed to forfeit any assets he obtained as a result of his crimes.
He was arrested again last month, when federal prosecutors accused him of trying to conceal his assets before sentencing.