DOJ Seal

Department of Justice

U.S. Attorney's Office
District of Maryland

For Immediate Release

Wednesday, February 12, 2020
Robert K. Hur
, United States Attorney
Contact: Marcia Murphy

Baltimore Business Owner Sentenced to 15 Years in Federal Prison for Conspiring to Burn Down His Business in Order to Obtain Insurance Proceeds

Convicted by a Federal Jury after a 7-Week Trial; Defrauded Insurer of Over $15 Million

Baltimore, Maryland – U.S. District Judge Ellen L. Hollander today sentenced Demetrios Stavrakis, a/k/a Jimmy, age 54, of Lutherville-Timonium, Maryland, to 15 years in federal prison, followed by three years of supervised release, for an arson conspiracy to damage his business by setting it on fire in order to obtain insurance proceeds.  Judge Hollander also ordered that Stavrakis forfeit $15,081,435.  The federal jury returned the guilty verdict late on October 28, 2019.

The sentence was announced by United States Attorney for the District of Maryland Robert K. Hur; Special Agent in Charge Timothy Jones of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Baltimore Field Division; Maryland State Fire Marshal Brian Geraci; and Commissioner Michael Harrison of the Baltimore Police Department.

U.S. Attorney Robert K. Hur stated, “The evidence proved that ‘Jimmy’ Stavrakis conspired to burn down his business in order to defraud his insurance company of millions of dollars in insurance proceeds.  Now he will serve 15 years in federal prison, where there is no parole—ever.  Criminals who commit arson to obtain insurance proceeds jeopardize their community and first responders, and must be held accountable.”

According to evidence presented at his 7-week trial, beginning in July 2015, Stavrakis made a plan to set fire to commercial property he owned at 234 S. Haven Street in Baltimore, in order to collect insurance proceeds on the property.  The building housed Adcor Industries, Inc., a manufacturing shop owned by Stavrakis since 1991, as well as Adcor Beverage, LLC and other LLC’s owned and created by Stavrakis. 

Testimony at trial revealed that by 2010, Adcor’s business experienced a downturn due to the loss of a contract with Colt Industries.  From 2011 to 2015, Stavrakis’s businesses defaulted on various loans, struggled to pay suppliers resulting in legal action, and sold off profitable divisions of the business to satisfy defaulted loans.  In 2014, Adcor incurred an operating loss of $2,053,427 and its liabilities exceeded its assets by almost $900,000.  Financial records showed that during 2014, Stavrakis liquidated personal assets and injected the proceeds into Adcor to utilize as working capital.  A public accounting firm hired by Adcor to review its financial condition reported to Stavrakis that the balance of cash and cash equivalents as of December 31, 2014 was inadequate to fund operations through December 31, 2015.  More losses followed, and Adcor was again in default on a line of credit and their monthly operating losses put them on pace to lose approximately $2.9 million for the year.

The evidence proved that on July 28, 2015, just before 6 p.m., Stavrakis used adhesive tape to defeat one of the security features on the front door of the building so that the person or persons setting the fire could enter the building.

According to the trial evidence, at 12:25 a.m. on July 29, 2015, someone disarmed the alarm inside the building by entering the four-digit code.  At 12:33 a.m., an alarm in another part of the building was disarmed.  At approximately 1:30 a.m., the fire was reported to law enforcement by a passerby who saw smoke emanating from the building.  The Baltimore Fire Department responded to extinguish the blaze.  The fire destroyed an office on the shop floor of the building and damaged a portion of the ceiling directly above the office area.  Later on July 29, 2015, Stavrakis contacted a public adjuster firm that his company had previously retained to notify them of the fire and to request their assistance in filing claims with the insurance company. 

Trial evidence proved that from July 29, 2015 through August 5, 2016, the adjusters, acting on behalf of Stavrakis and his companies, submitted insurance claims totaling more than $21 million.  The insurance company paid a total of approximately $15,081,435.  Of that amount, approximately $7.5 million was used to purchase new machinery, purchase parts inventory, restore the building, and for other business expenses.  In addition, insurance proceeds were transferred or used for other expenses, including $600,000 which was transferred to an account in the name of Stavrakis’s wife, after which additional monthly payments of approximately $6,000 followed; approximately $98,499.20 used to purchase a 2016 Mercedes-Benz GL 550, titled and registered to Stavrakis; approximately $52,890.55 used to purchase a BMW titled and registered in the name of Stavrakis’s wife; approximately $25,500 used to purchase a 2016 Harley-Davidson Street Glide motorcycle; and approximately $35,087 in watches and jewelry.

United States Attorney Robert K. Hur commended the ATF, the Office of the Maryland State Fire Marshal, and the Baltimore Police Department for their work in the investigation.  Mr. Hur thanked Assistant U.S. Attorneys Judson T. Mihok and Paul E. Budlow, who prosecuted the case.


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Baltimore Field Division