District of Alaska
Press releases recorded for this federal judicial district.
Anchorage Man Sentenced to Nine Years for Armed Bank RobberyRead the Press Release
Anchorage, Alaska-U.S. Attorney Karen Loeffler announced today that an Anchorage man was sentenced by Chief U.S. District Court Judge Ralph R. Beistline to serve a 108 month term of imprisonment for his commission of an armed bank robbery.
James Donald Surrells, 44, of Anchorage, Alaska, previously pled guilty to robbing a local branch of First National Bank Alaska (FNBA). As part of his plea, Surrells admitted his use of a handgun during the robbery and agreed that his sentence should be increased as a result of his gun possession.
Specifically, Surrells admitted that, on August 13, 2014, he donned a disguise and entered the bank armed with a handgun and a demand note. He took the note to one of the bank tellers and demanded money. When the teller leaned forward to see the note more clearly, Surrells showed her the butt of his handgun, which caused her to fear that he would kill or physically harm her if she did not comply with his demands. In total, Surrells was able to steal $1,210 before fleeing the bank.
Judge Beistline cited the victim’s plight in announcing the sentence, noting that Surrells’ actions put his own immediate desires above those of the victim, who was simply doing her job. Judge Beistline called the crime a “premeditated bank robbery with a gun” – noting that it took a great deal of planning to accomplish. The court also cited the defendant’s extensive criminal history, saying that such a past clearly demonstrates that Surrells disrespects the law whenever he is given a chance. Given those considerations, Judge Beistline felt it necessary to craft a sentence that protects the community and deters others from committing similar crimes in the future.
Following his prison term, Surrells will be on supervised release for a term of five years. He must also pay FNBA $1,210 in restitution. In announcing the sentence, Loeffler praised the work the Federal Bureau of Investigation and the Alaska State Troopers, whose investigation efforts led to Surrells’ arrest and conviction.
Two Fairbanks Residents Arrested for Filing False Income Tax Returns, Mail Fraud and Aggravated Identity TheftRead the Press Release
Anchorage, Alaska – Acting U.S. Attorney Kevin Feldis announced today that Earl Worthy, 39 and Tammy Jean Jackson, 39, of Fairbanks, Alaska, were arrested on February 24, 2015, for filing false income taxes. Worthy and Jackson were indicated by a federal grand jury on February 18, 2015, for one count of conspiracy to defraud the government with respect to claims; seven counts of mail fraud; and seven counts of aggravated identity theft.
According to the indictment, between approximately May 2009 and September 2012 Worthy and Jackson conspired to file false income tax returns claiming refunds to which they were not entitled and which used the identifying information of others. Many of the returns were filed for inmates at correctional facilities and in some instances the identifying information was used without the knowledge or permission of the person in question. Approximately 95 false tax returns claiming approximately $214,560 in fraudulent refund claims were submitted in the scheme.
The indictment alleges that the false income tax returns claimed false wages and tax withholdings based upon fabricated Forms W-2. These returns each claimed that the taxpayer in question was owed thousands of dollars in refunds to which they were not entitled. Paper copies of the false tax returns were mailed from Anchorage and Fairbanks, Alaska, and Tucson, Arizona, to the IRS in Fresno, California, for processing and the signatures on these paper returns were forged. Tax refund checks that were issued as a result were sent to the address listed on the false tax return which in some cases was the Fairbanks Correctional Center. Other refunds were issued via direct deposit into the bank account of a conspirator.
According to Assistant U.S. Attorney Steven E. Skrocki, if convicted, the defendants face terms of imprisonment of up 20 years and fines up to $250,000. Under the Federal Sentencing Guidelines the actual sentence imposed will be based upon the seriousness of the offense and the prior criminal history of the defendant.
An indictment is only a charging document and is not evidence of guilt. Defendants are presumed innocent and are entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
Acting U.S. Attorney Kevin Feldis stated, “The false income tax return scheme alleged in this case is consistent with similar schemes perpetrated previously in Alaska and throughout the United States. Such schemes not only impact all taxpayers generally, but they also can be devastating to the victims whose identities are stolen and used as part of the fraud.”
Mr. Feldis commends the IRS Criminal Investigation for the investigation of this case.
Members of Violent Drug Trafficking Ring ConvictedRead the Press Release
United States Attorney Karen L. Loeffler announced today the conclusion of two trials in the past two months, bringing to an end an 18-month investigation into a drug trafficking ring that not only distributed heroin, cocaine, crack, and methamphetamine, but also conducted home invasions, drive-by shootings, committed kidnappings and sexual assaults, and used firearms in furtherance of those crimes.
In November 2013, a grand jury indicted Stuart T. Seugasala, a.k.a. "Tone," age 40, Phosavan Khamnivong, a.k.a. “P.K.,” age 35, Timothy Miller, a.k.a. "Lil Tone," age 26, Anoai Sialofi, a.k.a. "A-Loc", age 26, and Laura Khamnivong (Phosavan’s wife), age 33, for drug trafficking conspiracy. Kidnapping and firearms charges were brought against Seugasala, Khamnivong, Miller, and Sialofi. Seugasala and Stacy Laulu, age 33, were also charged with violations of the Health Information Portability and Accountability Act (HIPAA). Miller, Sialofi, and Laura Khamnivong pled guilty before trial. All of the defendants were from Anchorage, Alaska.
The January 5, 2015, first trial involved the charges against Stuart T. Seugasala and Stacy Laulu. Prior to that, Miller and Sialofi had pleaded guilty to the two kidnapping charges. Laura Khamnivong had pleaded guilty to the drug trafficking conspiracy charge. Seugasala was charged with orchestrating a violent drug trafficking ring that both imported drugs and engaged in home invasions to obtain money and drugs. The jury heard evidence that Seugasala sexually assaulted his victims, including two victims that were raped with a hot curling iron on March 13, 2013. The reason for the brutal assault on the two victims was that one of them had owed Phosavan Khamnivong a drug debt that Seugasala believed had also been owed to him. After the hospitalization of one of the sexual assault victims, Seugasala sought and obtained that victim’s private health information from Stacy Laulu, then an employee of Providence Hospital. The information concerned the extent of the victim’s injuries, and whether the victim was cooperating with police. Seugasala also sought and obtained from Laulu the health information of another victim, whom Seugasala shot on March 15, 2013. Laulu likewise violated the privacy rights of that victim when she disclosed the victim’s personal health information to Seugasala.
On January 16, 2015, a federal jury convicted Seugasala of Drug Conspiracy, two counts of Kidnapping, and two counts of using firearms in furtherance of those crimes. The jury also convicted Seugasala and Laulu with two felony counts of HIPAA violations. Seugasala faces mandatory life imprisonment on the drug conspiracy conviction, two maximum life sentences on the kidnapping and firearms convictions. Seugasala had previously been convicted of two federal drug conspiracy charges in 2000 and served over ten years in federal prison. Both he and Laulu face a maximum of ten years imprisonment on each of the HIPAA convictions.
On February 24, 2015, a separate federal jury convicted Khamnivong of Drug Conspiracy, two counts of Kidnapping, and two counts of using firearms in furtherance of those crimes. During this trial, Khamnivong was identified as the financier for the conspiracy, as well as the person to whom Victim A owed a prior drug debt. At trial, Khamnivong was identified as the man who held Victim A down while Seugasala sexually assaulted Victim A. Khamnivong now faces the possibility of three federal life sentences without the possibility of parole for the drug conspiracy and two kidnappings, to be followed by additional time for the firearms convictions.
Khamnivong also faces eight years in state prison for violating his probation and parole. He was convicted in 1998 of murder in the second degree and was sentenced in that case to serve 25 years with 10 years suspended and was placed on probation for 10 years.
While Assistant United States Attorneys Frank V. Russo and Stephan A. Collins were prosecuting the Khamnivong trial, the DEA arrested Jason McAnulty for attempting to tamper with a witness who was scheduled to testify at the trial. According to an affidavit filed in support of a criminal complaint, McAnulty is alleged to have contacted Victim A and conveyed a message from Khamnivong. The message was that if Victim A did not testify against Khamnivong at trial, Victim A would receive a classic automobile that belonged to Khamnivong. The DEA recorded conversations between McAnulty and Victim A to confirm this attempted bribe. McAnulty was arrested and charged with attempted witness tampering. Magistrate Judge Deborah Smith found probable cause to detain McAnulty pending presentation of the case to the Grand Jury.
The trial evidence at both trials included the graphic and cruel nature of the drug conspiracy. Seugasala would imprison drug users and others in his apartment, located at 1046 W. 26th Avenue, as well as his video gaming business, "Friendly Fire" in Anchorage. He sometimes tortured individuals who owed him money or disrespected him or others in his organization. Seugasala and his accomplices burned people with cigarettes, sexually assaulted them, used firearms on them, and assaulted them in other ways.
In February, 2013, Seugasala, P. Khamnivong, and Miller conspired to mail over five pounds of methamphetamine from California to Alaska. The United States Postal Service intercepted the drugs before they were delivered. The evidence at both trials established that the men lost another pound of methamphetamine during the same time period. On March 13, 2013, the men attempted to collect a drug debt owed by Victim A to P. Khamnivong. Seugasala lured Victim A, as well as another victim, to Miller's apartment at 1046 W. 26th Avenue. When the victims entered, Khamnivong, Miller, and Sialofi drew guns on the victims, duct taped them, beat them, and tortured them for approximately three hours. Seugasala raped the victims with a hot curling iron while telling Victim A that this is “what happens to [people] who don’t pay.” P. Khamnivong stepped Victim A’s head down while Seugasala raped him. Seugasala instructed Miller to videotape the rape of Victim A, which Miller did. Seugasala later showed the video to others to intimidate them and to show them what would happen if they didn't repay their drug debts. .
Seugasala and Khamnivong then put guns to both victims' heads, going so far as handing the gun to the second victim and telling him that he had to kill Victim A, or they both would die. The men were held for approximately three hours, then forced to go to a strip club with the men, where Victim A agreed to pay Khamnivong $50,000 within 30 days. On those conditions, both men were released. Victim A went to Providence Hospital, where he was admitted for his injuries. At the time, Stacy Laulu was a financial counselor of Providence Hospital. The testimony at trial was that Laulu's husband was a close associate of Seugasala, and that Seugasala and Miller continued to deliver drug money to Laulu and Laulu's husband, who was in jail on unrelated murder charges. Seugasala communicated by text message to Laulu and requested information on Victim A's medical condition and whether he was cooperating with authorities investigating the sexual assault. Laulu accessed Victim A's medical records and provided Seugasala with the information. Seugasala also asked Laulu about the condition of another individual, who was treated for a gunshot wound at Providence Hospital on March 15. Testimony at trial indicated that Seugasala shot the man's vehicle as it drove south on the Seward Highway. Apparently the man had insulted Seugasala's companion at a restaurant in the early morning hours of March 15. The bullet disfigured the man's pinky, as well as grazed his neck.
On April 23, 2013, the Valdez Police Department arrested Devon Totemoff and Timothy Miller, after they had arrived in Valdez to sell drugs supplied by Seugasala and Khamnivong. Valdez Police seized Miller's telephone and got a search warrant for it. The Alaska State Troopers executed the search warrant on the phone and ultimately found the sexual assault video from March 13.
In the meantime, the Anchorage Police Department, the Drug Enforcement Administration, and the FBI Safe Streets Task force were investigating Seugasala and Khamnivong. They observed the two men meet on May 16, and Anchorage Police pulled over Khamnivong's vehicle. When the police officer notified Khamnivong that he planned to search Khamnivong’s vehicle, Khamnivong smashed his car into two patrol vehicles and fled the scene, ultimately escaping. A citizen found a discarded pistol near Stellar High School, which was along the route that Khamnivong's vehicle followed while escaping. Anchorage Police and FBI Safe Streets Task Force members then followed the defendant's wife's vehicle to where she stopped in a parking lot; an officer saw her put a plastic bag in another vehicle. APD obtained a search warrant and found two guns, a small amount of methamphetamine, and drug paraphernalia in the bag.
On May 20, 2013, the DEA conducted surveillance of Seugasala, and saw him visit a number of locations around Anchorage. He was stopped by the Anchorage Police Department, who contacted the United States Probation Office. The United States Probation Office directed that the Anchorage Police search the defendant and his vehicle. The police seized nearly $8,000 and Seugasala's cellular telephone. The DEA executed a search warrant on the phone and found the text exchanges between Laulu and Seugasala, as well as text messages with Miller on March 13 to arrange the kidnappings.
Seugasala was arrested by the United States Probation Office on June 12, 2013, the day after the defendant was identified in the sexual assault video. Additional money and cellular telephones were found, including a cellular telephone used by Miller to communicate with both Seugasala and Khamnivong when he was in California obtaining drugs in February.
After he fled on May 16, 2013, Khamnivong remained in hiding until December 4, 2013, when he was arrested by members of the U.S. Marshals Fugitive Task Force. Agents seized more drugs, guns, money, and drug paraphernalia in the apartment where Khamnivong was hiding.
United States Chief District Court Judge Ralph R. Beistline, who presided over the trials, scheduled sentencing hearings for the various defendants in late April through early May, 2015.
United States Attorney Karen L. Loeffler noted: “This case was the result of hard work, perseverance and dedication by a myriad of federal, state and local agencies focused on protecting the public safety of our community. The convicted defendants were and are dangerous, violent individuals. We are blessed in Alaska to have such a strong working relationship between and among our law enforcement agencies and partners and we will remain committed to the arrest and conviction of these violent individuals and organizations.”
The case was investigated by the Drug Enforcement Administration, with assistance from the FBI's Safe Streets Task Force and its Cellular Assistance Survey Team, as well as Bureau of Alcohol Tobacco, Firearms and Explosives, the Anchorage Police Department, the Valdez Police Department, the Alaska State Troopers Technical Crimes Unit and State Crime Laboratory, the United States Postal Inspection Service, the Department of Homeland Security, Providence Hospital, the United States Marshals, and the United States’ Probation Office. The prosecution of the defendants was coordinated with the State of Alaska Attorney General's Office.
Wasilla Man Sentenced to 84 Months in Prison for Heroin Trafficking ConspiracyRead the Press Release
Anchorage, Alaska-U.S. Attorney Karen L. Loeffler announced today that a Wasilla man was sentenced by U.S. District Court Judge Sharon L. Gleason to serve 84 months in federal prison for his role in a heroin trafficking conspiracy.
James Gwaltney, 38, of Wasilla, Alaska, previously pled guilty to conspiring to distribute more than 1.6 kilograms of heroin throughout the Anchorage area. As part of his plea, Gwaltney admitted that in October 2013, he and co-defendant Baretta Faatafuga received an Express Mail package from California containing heroin that had been concealed inside a Sentry Safe. Both co-defendants intended to distribute the heroin to others.
Upon his release from prison, Gwaltney will remain under court supervision for five years, during which time he must complete 200 hours of community service. The sentence announced today took into consideration Gwaltney’s possession of both the heroin itself as well as drug packaging materials, a scale, multiple cell phones and laptop computers, as well as $5000 in cash. In sentencing Gwaltney, Judge Gleason noted the seriousness of Gwaltney’s offense and the dangers of both drugs and drug addiction.
Gwaltney’s co-defendant, Baretta Faatafuga, was previously sentenced by Judge Gleason to serve a term of 90 months in prison. In announcing Faatafuga’s sentence, Judge Gleason emphasized the dangerous and negative impact caused by bringing drugs into our community and noted that many families are destroyed by heroin. Together, the sentences of both men will protect the Anchorage community for years to come.
In announcing the sentence, U.S. Attorney Loeffler praised the United States Postal Inspection Service, the Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms, and Explosives, Homeland Security Investigations, and the Alaska State Troopers who investigated the case.
Owners of Floating Kodiak Strip Club Indicted by Federal Grand JuryRead the Press Release
Anchorage, Alaska – United States Attorney Karen L. Loeffler announced today that a federal grand jury returned a three-count indictment against Kimberly Christina Reidel-Byler, 46, and Darren K. Byler, 54, both residing near Kodiak, Alaska, charging them with offenses relating to the improper disposal of human waste into waters in and around Kodiak, Alaska.
According to the Indictment filed in this case, the Bylers owned and operated the Wild Alaskan, a converted 94-foot Bering Sea crabber anchored in St. Herman Harbor, Kodiak, Alaska. Between June 25, 2014, and November 30, 2014, the Wild Alaskan was a floating bar and strip club. Customers were ferried to the vessel from shore by the Gulf Coast Responder, a 35-foot landing craft.
During its operation, Kimberly Byler told the U.S. Coast Guard that human waste from the Wild Alaskan was being stored in a 5,000 gallon tank on the vessel, and then disposed of shore side by a commercial waste disposal firm. Darren Byler told the U.S. Coast Guard that waste from the Wild Alaskan was being disposed of at Pier 2, St. Herman Harbor, or that he would transport the human waste in the Gulf Coast Responder to a point three nautical miles offshore, where he would then dump it into the ocean.
The Indictment alleges that these representations to the U.S. Coast Guard were false. Indeed, waste from the Wild Alaskan was being piped from the customer and employee bathrooms directly overboard and into St. Herman Harbor. Disposal of human waste without a permit into waters within three nautical miles of shore is a violation of the Refuse Act, Title 33, United States Code, Sections 407 and 411. Making material false statements to the U.S. Coast Guard is a violation of Title 18, United States Code, Section 1001.
The case was the product of an investigation by the U.S. Coast Guard Investigative Service. Assistant United States Attorney Kyle Reardon is prosecuting the case.
Darren Byler made his initial appearance and was arraigned on February 23, 2015. Kimberly Byler is not yet in federal custody.
If convicted of violating the Refuse Act, the Bylers face not less than 30 days in jail and up to one year, a fine of $25,000 for each day the act was violated, a one-year term of supervised release, and a $25 special assessment. If convicted of making false statements, the Bylers face up to five years in prison, a $250,000 fine, a three-year term of supervised release, and a $100 special assessment. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
Store Owner Sentenced to Prison and Forfeiture of Funds for Federal Food Program FraudRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that an Anchorage store owner was sentenced by U.S. District Court Judge Timothy M. Burgess to 18 months imprisonment, along with forfeiture of over $42,000 in criminal proceeds in connection with a United States Department of Agriculture food aid program fraud scheme which he operated out of his Anchorage store.
In late 2013, Africa and Middle East Market store owner Ayub Yusuf Eprahin, 45, was charged by the federal grand jury with 15 counts of wire fraud and 11 counts of U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) food aid fraud in connection with the illegal use of food aid debit cards. Eprahin, who plead guilty in 2014, to two counts of wire fraud, contested the overall loss amount of the scheme, claiming it amounted to only $42,000. In day-long and contentious sentencing hearing, Judge Burgess found that Eprahin had defrauded the United States Department of Agriculture of more than $335,000 over a period of 19 months. As part of that finding, Judge Burgess imposed a sentence of 18 months imprisonment, forfeited to the United States more than $42,000 in funds seized from Eprahin, and imposed a term of three years of supervised release.
According to Assistant U.S. Attorney Steve Skrocki, in November, 2012, Eprahin was the owner of the Africa and Middle East Market and a participant in the Supplemental Nutrition Assistance Program (SNAP), formerly known as the “Food Stamp Program” administered by the United States Department of Agriculture’s Food and Nutritional Service. The program is designed to provide authorized nutritional foods to low-income families. The federal government pays the full cost of the SNAP benefits and also shares with the states some of the administrative costs. Under the SNAP program, authorized recipients are issued a certain amount of benefits each month, which they may use to purchase eligible food items. SNAP recipients typically receive their benefits in the form of a credit on their personal electronic benefit transfer card. The rules of the program prohibit the purchase of items other than food, and the card benefits cannot be redeemed for cash. As a participant in the program, Eprahin received computer issued payments based on unauthorized purchases made by participants from his store.
As part of the scheme Eprahin permitted non-food items and cash to be redeemed from participants in the program on a large scale. In so doing, Eprahin represented to the SNAP program that the benefits were being redeemed to purchase eligible food items when they in fact were not. Instead, Judge Burgess found that the cards were being used like ATM cards with amounts being debited for cash instead of food items required by the program and with some of that cash being wired overseas. Judge Burgess noted that Eprahin’s actions negatively impacted the community, other small businesses and the integrity of a government program designed to help and feed people in need, finding the offense, “very, very serious as hundreds of thousands were misused by not being provided to those it was supposed to help.”
Ms. Loeffler commends the Federal Bureau of Investigation, and United States Department of Agriculture, Office of Inspector General, who administers the SNAP program, for their investigation of this case.
Kodiak Man Indicted for Possession with Intent to Distribute MethamphetamineRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that a Kodiak man was indicted by a federal grand jury in Anchorage, Alaska on drug charges.
Teodoro Berdan, 55, of Kodiak, Alaska was charged with one count of possession with intent to distribute over 50 grams of a mixture or substance containing a detectable amount of methamphetamine. Berdan was arrested on February 7, 2015, in Kodiak after taking possession of a U.S. Postal Service parcel containing 122 grams of a substance that field tested positive for methamphetamine.
Assistant U.S. Attorney Bryan Schroder, who presented the case to the grand jury, indicated that Berdan faces a maximum sentence of 40 years in prison, and a $5,000,000 fine. Under the U.S. Sentencing Guidelines, the actual sentence imposed will be based on a number of factors, including the seriousness of the offense and any prior criminal history of the defendant.
The U.S. Postal Inspection Service conducted the investigation leading to the indictment in this case, with assistance from the FBI and the Kodiak Police Department.
An indictment is only a charge and is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
Anchorage Woman Charged with 20 Counts of Bank Fraud and Aggravated Identity TheftRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that an Anchorage woman has been charged with 20 counts of Bank Fraud and Aggravated Identity Theft for falsely altering stolen checks and cashing them at banks around Anchorage.
Denae Sullivan, 32, of Anchorage, is charged in a 20-count indictment with a scheme to defraud banks using checks stolen from the mail and from vehicle break-ins. She is further charged, as part of the scheme, with stealing the identities of individuals in Anchorage and Illinois. The investigation is one of several targeted by the United States Postal Inspection Service to address a recent increase in mail theft rings in the Anchorage area.
According to Assistant U.S. Attorney Aunnie Steward, who presented the case to the grand jury, Sullivan cashed checks at banks around Anchorage that had been stolen from victims’ mailboxes in Anchorage. She then altered the payee to match a driver’s license she obtained from a victim, and used that stolen identification to negotiate the stolen checks. The stolen checks included payments for rent, charitable donations to a church, and blank checks stolen during vehicle break-ins. Sullivan victimized more than 10 individuals and organizations for a total loss of more than $20,000.
The law provides for a maximum sentence of 30 years in prison and a fine of $1 million or both. Under federal sentencing statutes, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
The United States Postal Inspection Service and the Anchorage Police Department conducted the investigation leading to the indictments in the case.
Shipping Company and Chief Engineer Charged with Dumping Oil in Alaska's Exclusive Economic ZoneRead the Press Release
Anchorage, Alaska – Karen L. Loeffler, U.S. Attorney, announced today that AML Ship Management GMBH, a German company, and Nicolas Sassin, Chief Engineer of a vehicle carrier ship it operated, the M/V City of Tokyo, were both charged with knowingly dumping oil into United States’ waters off the coast of Alaska in August 2014 in violation of the Clean Water Act.
AML and Chief Engineer Nicolas Sassin have also been charged in separate cases filed in the District of Oregon with violating the Act to Prevent Pollution from Ships (APPS) for knowingly creating and presenting false records to the U.S. Coast Guard when it arrived in port in Portland, Oregon in September 2014. The Clean Water Act charges in Alaska and the APPS charges in Oregon are felony offenses.
Under the terms of a plea agreement filed in federal court today, AML will plead guilty to the Clean Water Act and APPS charges, pay a total of $800,000 in fines and community service payments, implement a comprehensive Environmental Compliance Plan, and will be placed on probation for three years. Chief Engineer Sassin also signed a plea agreement filed in court today agreeing to plead guilty to the Alaska and Oregon charges.
Defendant AML is the operator of the Motor Vessel City of Tokyo. The M/V City of Tokyo is a vehicle carrier vessel that operates under the flag of the Republic of Liberia. It was built in 1987, weighs approximately 42,247 gross tons, and is 603 feet long. Defendant Nicolas Sassin worked as the Chief Engineer of the M/V City of Tokyo between May 28, 2014 and September 6, 2014, when the vessel arrived in Oregon and was contacted by the U.S. Coast Guard.
On August 22, 2014, the M/V City of Tokyo departed South Korea and travelled through the Exclusive Economic Zone (EEZ) of the United States off the coast of Alaska arriving in Canada on September 2, 2014. The vessel departed Canada on September 3, 2014. The M/V City of Tokyo arrived in Tacoma, Washington on September 4, 2014, and remained there until departing for Portland, Oregon. The M/V City of Tokyo arrived in Portland, Oregon on September 5, 2014.
As the operator of the M/V City of Tokyo, AML was responsible for operating the Oil Water Separator (OWS) and maintaining an accurate Oil Record Book (ORB). As the Chief Engineer, Nicolas Sassin was responsible for the pollution control equipment in the M/V City of Tokyo’s engine room, including running the OWS and maintaining the Oil Record Book (ORB).
The federal charges allege that on or about August 29, 2014, Chief Engineer Sassin knowingly discharged oily bilge water into the United States’ Exclusive Economic Zone off the coast of Alaska which may have affected natural resources belonging to, appertaining to, and under the exclusive management authority of the United States and in a quantity that may be harmful.
Specifically, AML admits that while the M/V City of Tokyo was approximately 165 nautical miles south of the Aleutian Islands, specifically Sanak Island, Alaska, the Chief Engineer used an illegal pump system to knowingly discharge approximately 4,500 gallons of oily bilge water directly overboard. The illegal pump system consisted of a fabricated flanged fitting that connected the overboard discharge valve and pipe to a pneumatic Wilden pump. The pump’s suction was connected to a hose that was fed down the sounding tube for the bilge holding tank. The illegal pump system allowed the vessel’s crew to discharge oily bilge water from the bilge holding tank directly overboard without processing it through the required pollution prevention equipment (OWS and oil content meter). The overboard discharge created a sheen in the water off the stern of the vessel, and this was witnessed by crewmembers aboard the M/V City of Tokyo. The illegal pump system was dismantled prior to the vessel’s arrival in Portland.
AML knowingly failed to maintain an accurate ORB as required by the Act to Prevent Pollution from Ships (APPS).
Chief Engineer Sassin and AML are also charged with failing to record this discharge of oil into the sea by way of the illegal pump system and overboard discharge valve in the M/V City of Tokyo’s ORB, and with knowingly presenting the false and fictitious ORB to the U.S. Coast Guard and/or had it available for inspection by the U.S. Coast Guard when the M/V City of Tokyo arrived in Portland, Oregon on September 5, 2014.
The M/V City of Tokyo was initially inspected and detained in Portland, Oregon by the U.S. Coast Guard marine inspectors. These cases were investigated by the U.S. Coast Guard Investigative Service and are being prosecuted jointly by the U.S. Attorney’s Office for the District of Alaska, the U.S. Attorney’s Office for the District of Oregon, and the Department of Justice’s Environmental Crimes Section.
California Man Sentenced to 72 Months for Role in Oxycodone and Money Laundering ConspiraciesRead the Press Release
Anchorage, Alaska-U.S. Attorney Karen L. Loeffler announced today that a California man was sentenced by U.S. District Court Judge Timothy M. Burgess to serve a 72 month term of imprisonment for his role in an oxycodone distribution and money laundering ring.
Anwar Hasan, 69, of Oakland, California, previously pled guilty to conspiring to distribute large quantities of oxycodone and, additionally, to conspiring to launder the proceeds of his drug trafficking activities. As part of his guilty plea, Hasan admitted to acquiring oxycodone pills in California and then selling them to distributors in New York, New Jersey, California and Alaska. He further admitted recruiting others to distribute oxycodone in Alaska because the prices were higher here.
After Hasan’s distributors sold the oxycodone they deposited the proceeds of their trafficking into a bank account that Hasan maintained. Between January and September 2010, Hasan received more than $284,000 in cash deposits to his bank account, despite only earning just over $15,000 in declared income for the same year. As part of his guilty plea, Hasan admitted that the $284,000 were the proceeds of oxycodone trafficking.
In announcing the 72-month sentence, Judge Burgess called Hasan’s actions dramatic and extremely serious. Judge Burgess also noted that it was clear that Hasan’s actions were motivated by money and emphasized the need to protect the public and deter others from committing similar crimes.
Following his prison term, Hasan will be on supervised release for a term of three years. In announcing the sentence, Ms. Loeffler praised the work of Homeland Security Investigations who served as the lead agency on the investigation that lead to Hasan’s conviction.
Meth Cook Sentenced to 24 Years on Drug and Weapons ChargesRead the Press Release
Anchorage, Alaska – U.S. Attorney Karen L. Loeffler announced today that Simon Douglas Smith, 35, formerly of Sturgis, Michigan, was sentenced today in federal court to 24 years in prison.
Smith pled guilty in 2013 to manufacturing methamphetamine and possession of firearms by a convicted felon. He was arrested by Anchorage Police Department officers in May 2010, when several firearms and a “one pot” meth lab were found in his car. He was arrested a month later, in June 2010, by Alaska State Troopers, who discovered another one-pot meth lab and another gun. Investigators learned that Smith’s girlfriend, Nichole M. Millsaps, 26, had disappeared just before the first arrest. Smith was indicted on federal meth manufacture and weapons charges in December 2010, and was subsequently charged by the State of Alaska with the murder of Nichole Millsaps.
United States District Court Judge Timothy M. Burgess found that Smith was responsible for manufacturing “substantially more than 50 grams” of actual methamphetamine between July 2009, when he arrived in Alaska, and June 2010. Evidence presented at a December 2014 hearing established that Smith used numerous individuals to purchase cold medicine on his behalf to avoid limits and reporting requirements imposed by state and federal law. Judge Burgess found that Smith was a manager and supervisor of a criminal organization that involved five or more persons and was otherwise extensive, and that he engaged in drug dealing as a livelihood.
Judge Burgess described Smith as the “Johnny Appleseed” of the one-pot meth lab in Alaska, not only cooking meth for his own use but also teaching others how to cook, even after he was in jail. The judge described the impact as “exponential” and pointed to numerous lives destroyed by Smith’s actions. Smith has “the opposite of the Midas touch,” since everyone he touched was harmed. Judge Burgess commented that Smith “blazed a trail filled with misery, tragedy, and ruin.”
Smith was scheduled for sentencing on February 7, 2014, but requested a postponement. The following day, February 8, 2014, Nichole Millsaps’ remains were found in the area of Indian, Alaska, near where she and Smith had been camping in May 2010. Millsaps was shot once in the right rear of the head. A .32 derringer was found buried at the base of a tree approximately 30 feet from where Millsaps’ remains were discovered.
Smith still faces murder charges in the Superior Court of the State of Alaska. Under state law he could be sentenced to up to 99 years for first or second degree murder. Judge Burgess declined to consider the death of Ms. Millsaps when he imposed sentence, noting that there was a separate state process for the murder charge pending in State court. Judge Burgess did describe Smith as extremely dangerous and stated that the community needed protection from him for a very long time.
This case was investigated by the Alaska State Troopers; the Alaska Bureau of Investigation; the Mat-Su Drug Unit; the Bureau of Alcohol, Tobacco, Firearms, and Explosives; and the Anchorage Police Department.
Supplier of Anchorage and Missouri Drug Conspiracies Pleads Guilty to Drug and Money Laundering ConspiracyRead the Press Release
Anchorage, Alaska-U.S. Attorney Karen L. Loeffler announced today that the lead defendant of a drug conspiracy involving nine individuals pled guilty in federal court today. Six of the eight other co-conspirators have previously pled guilty to federal drug charges or been sentenced for their roles in the conspiracy.
Steven N. Taylor, a/k/a "Louis V," a/k/a "Nicky," 43, of Seattle, Washington, pled guilty today in U.S. District Court in Anchorage to Counts 1 and 2 of an Indictment charging a drug and money laundering conspiracy. Taylor admitted that he imported between 15 and 50 kilograms of cocaine to Alaska between 2009 and 2014. In a plea agreement filed with the court, Taylor admitted that he would send parcels of cocaine to Alaska from Washington. In addition, he agreed that he would use bank accounts in other names to launder the proceeds of drug trafficking. Taylor also agreed to plead guilty to a separate but related drug conspiracy indictment currently pending in the Eastern District of Missouri.
Chief U.S. District Court Judge Ralph R. Beistline scheduled Taylor’s sentencing for April 27, 2015. Taylor has been in federal custody since his arrest in Seattle, Washington, in August 2012.
According to the court documents, Taylor, a Washington State resident, was a long-time supplier of cocaine to Alaska. He was previously convicted by the U.S. District Court in the Western District of Washington for Drug Conspiracy in November 1997.
Taylor was indicted along with eight other members of the conspiracy who were located in Anchorage, Fairbanks, Seattle, Washington, and Florida. James Brown, Sr., a/k/a "Unc," of Seattle, was sentenced to 56 months imprisonment on August 11, 2014; Leonard Charles, of Seattle, was sentenced to 60 months imprisonment on April 14, 2014; Gabrielle Haynes, of Fairbanks, was sentenced to 18 months imprisonment on April 11, 2014; and Joseph Irving, of Seattle, was sentenced to 21 months imprisonment on April 2, 2014.
Shawn Cloyd, a/k/a "CC," a/k/a, "Rider," and Timothy Northcutt, a/k/a "OG," a/k/a, "Butch," both from Anchorage, have plead guilty to Drug Conspiracy and currently await sentencing. Joshua Haynes, a/k/a "Lil J," of Fairbanks and Florida, is scheduled to plead guilty to Drug Conspiracy on February 4, 2015.
Etienne Devoe, a/k/a "Tien," a/k/a "Tin," of Fairbanks, is scheduled to go to trial in Anchorage on March 23, 2015.
Taylor faces a maximum sentence of life imprisonment for the drug conspiracy.
Ms. Loeffler commended the Drug Enforcement Administration, the Federal Bureau of Investigation, the United States Postal Service, the Internal Revenue Service Criminal Investigation Division, and the Anchorage Police Department for the investigation leading to the successful prosecution of Mr. Taylor.
Supplier of Anchorage and Missouri Drug Conspiracies Pleads Guilty to Drug and Money Laundering ConspiracyRead the Press Release
Anchorage, Alaska-U.S. Attorney Karen L. Loeffler announced today that the lead defendant of a drug conspiracy involving nine individuals pled guilty in federal court today. Six of the eight other co-conspirators have previously pled guilty to federal drug charges or been sentenced for their roles in the conspiracy.
Steven N. Taylor, a/k/a "Louis V," a/k/a "Nicky," 43, of Seattle, Washington, pled guilty today in U.S. District Court in Anchorage to Counts 1 and 2 of an Indictment charging a drug and money laundering conspiracy. Taylor admitted that he imported between 15 and 50 kilograms of cocaine to Alaska between 2009 and 2014. In a plea agreement filed with the court, Taylor admitted that he would send parcels of cocaine to Alaska from Washington. In addition, he agreed that he would use bank accounts in other names to launder the proceeds of drug trafficking. Taylor also agreed to plead guilty to a separate but related drug conspiracy indictment currently pending in the Eastern District of Missouri.
Chief U.S. District Court Judge Ralph R. Beistline scheduled Taylor’s sentencing for April 27, 2015. Taylor has been in federal custody since his arrest in Seattle, Washington, in August 2012.
According to the court documents, Taylor, a Washington State resident, was a long-time supplier of cocaine to Alaska. He was previously convicted by the U.S. District Court in the Western District of Washington for Drug Conspiracy in November 1997.
Taylor was indicted along with eight other members of the conspiracy who were located in Anchorage, Fairbanks, Seattle, Washington, and Florida. James Brown, Sr., a/k/a "Unc," of Seattle, was sentenced to 56 months imprisonment on August 11, 2014; Leonard Charles, of Seattle, was sentenced to 60 months imprisonment on April 14, 2014; Gabrielle Haynes, of Fairbanks, was sentenced to 18 months imprisonment on April 11, 2014; and Joseph Irving, of Seattle, was sentenced to 21 months imprisonment on April 2, 2014.
Shawn Cloyd, a/k/a "CC," a/k/a, "Rider," and Timothy Northcutt, a/k/a "OG," a/k/a, "Butch," both from Anchorage, have plead guilty to Drug Conspiracy and currently await sentencing. Joshua Haynes, a/k/a "Lil J," of Fairbanks and Florida, is scheduled to plead guilty to Drug Conspiracy on February 4, 2015.
Etienne Devoe, a/k/a "Tien," a/k/a "Tin," of Fairbanks, is scheduled to go to trial in Anchorage on March 23, 2015.
Taylor faces a maximum sentence of life imprisonment for the drug conspiracy.
Ms. Loeffler commended the Drug Enforcement Administration, the Federal Bureau of Investigation, the United States Postal Service, the Internal Revenue Service Criminal Investigation Division, and the Anchorage Police Department for the investigation leading to the successful prosecution of Mr. Taylor.
Leader of Mail Theft Ring, "Superman," Charged in 18-Count Indictment with Three Co-ConspiratorsRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that four Anchorage residents were charged in an eighteen-count indictment for their role in a mail theft ring that involved distribution of methamphetamine.
Jonathan Ortiz Escalante, aka “Superman,” 45, of Anchorage, was charged in an eighteen-count indictment with conspiracy, theft of mail, credit card fraud, bank fraud, counterfeit securities, aggravated identity theft, trafficking in methamphetamine, and being a felon in possession of firearms in relation to a shooting in Anchorage. Escalante was previously convicted of conspiring to commit bank fraud in Washington and is therefore prohibited from possessing firearms.
Neasha Martha Moore, 24, of Anchorage, is charged in three counts of the indictment with conspiracy, bank fraud, and counterfeit security, for her role in cashing checks stolen from the mail.
Ralph Edward Oliver, 20, of Anchorage, is charged in two counts of the indictment with conspiracy and attempted bank fraud for his role in attempting to cash checks stolen from the mail.
John Fred Brittain, 23, of Anchorage, is charged in two counts of the indictment with conspiracy and theft of mail for his role in stealing mail in exchange for methamphetamine.
According to Assistant U.S. Attorney Aunnie Steward, who presented the case to the grand jury, Escalante aka “Superman” is alleged to be the leader of a mail theft ring in Anchorage. The indictment charges that Escalante solicited Brittain and others to steal mail and identification cards that he then altered and used to cash stolen checks. Escalante also used stolen credit cards and forged counterfeit securities, and distributed methamphetamine to Brittain and others in exchange for stolen mail. Escalante solicited Moore, Oliver, and others to cash the fraudulent checks. The felon in possession count alleges that Escalante possessed two different Ruger 9mm pistols while he carried out his drug trafficking crimes.
Escalante made his initial appearance before United States Magistrate Judge Kevin McCoy on January 23, 2015. The remaining defendants are not yet in federal custody.
Escalante is facing a mandatory minimum of five years’ incarceration and a maximum of forty years’ incarceration, and a $5 million fine. Moore and Oliver are facing a maximum of thirty years’ incarceration and a $1 million fine. Brittain is facing a maximum of five years’ incarceration and a $250,000 fine.
Ms. Loeffler commends the U.S. Postal Inspection Service, the ATF, the FBI Safe Streets Task Force, and APD for the investigation of this case.
Anchorage Man Sentenced to 17.5 Years Imprisonment for Sexually Exploiting ChildrenRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that an Anchorage, Alaska man was sentenced in Federal Court in Anchorage on two counts of child sexual exploitation crimes. Kevin Callander was convicted of producing child pornography depicting a 10 year old girl. Callander’s victimization of the child began on July 10, 2012, while on a family vacation in Georgia, and continued on July 17, 2012, in Florida. Callander produced videos on those days using his iPhone, and then emailed them in interstate commerce.
Callander, 45, was sentenced January 22, 2015, by United States District Court Judge Sharon L. Gleason, to 17.5 years on each of the two convictions. Those sentences will run concurrently to each other, and to a separate 12 year prison term imposed by the State of Alaska for Sexual Abuse of a Minor. Callander’s prison terms will be followed by federal supervised release for the rest of his life.
U.S. Attorney Karen Loeffler stated, “The lengthy sentence in this case reflects the victimization perpetrated on innocent victims by Callander. Working with our law enforcement partners to protect children is a top priority and a constant mission.”
According to Assistant U.S. Attorney Audrey J. Renschen, Callander was under investigation for trafficking in child pornography by the Anchorage Police Department (APD) when they executed a search warrant at Callander’s home. APD then contacted U.S. Postal Inspection Service (USPIS) Agents when the videos that Callander produced were found.
Ms. Loeffler commends the USPIS and APD, members of the Alaska Internet Crimes Against Children Task Force, for the investigation of this case.
This prosecution is part of the Department of Justice’s ongoing Project Safe Childhood initiative (PSC) which was launched to increase federal prosecutions of sexual predators of children, and to reduce the number of Internet crimes against children including child pornography trafficking. As a part of PSC, the United States Attorney’s Office has teamed with state and local agencies and organizations to increase law enforcement presence on the Internet, and to educate the public about safe Internet use, thereby reducing the risk that children might fall prey to online sexual predators. For additional information on the PSC initiative, please go to www.projectsafechildhood.gov or call the United States Attorney’s Office for the District of Alaska.
Two Men Indicted for Burglarizing Sand Point Post OfficeRead the Press Release
Anchorage, Alaska-U.S. Attorney Karen Loeffler announced today that an indictment had been returned charging two men with burglarizing the post office in Sand Point, Alaska.
Sheldon Wilson Shuravloff, 21, and Keith Lee Wilson Jr., 18, both of Sand Point Alaska are named in both counts of the two-count indictment. The first count charges the men with conspiring to burglarize the post office in late December 2014. The second count charges both with forcibly breaking into the post office with the intent to commit a larceny or other crime once inside. The indictment stems from a break in that occurred at the post office on or about December 28 of last year. The burglary resulted in damage to the post office itself and to some postal equipment kept inside. It also forced the post office to close for a week, thereby preventing Sand Point residents from receiving their mail.
Assistant United States Attorney Stephanie Courter, who presented the case to the grand jury, indicated both Shuravloff and Wilson face up to five years in prison and a fine of up to $250,000 on each of the two charges. The law also allows a court, upon a conviction, to order the men to pay restitution in the amount of the damage done to the post office as a result of their actions. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offense and the prior criminal history of the defendant.
The men will be arraigned in federal court in the coming days. The United States Postal Inspection Service, the Sand Point Police Department, and the Alaska State Troopers conducted the investigation leading to the indictment in this case.
An indictment is only a charge and is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
Kotzebue Man Sentenced to 9 Years Imprisonment for Sexually Exploiting ChildrenRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that a Kotzebue, Alaska man was sentenced in Federal Court in Anchorage on two counts of child sexual exploitation crimes. Culum Campbell was convicted of receipt and possession of child pornography. Campbell was using a peer to peer network to traffic child pornography, and had both distributed and received videos of children being sexually exploited.
Campbell, age 33, was sentenced January 23, 2014, by United States District Court Judge Sharon L. Gleason, to 9 years on each of the two convictions. Those sentences are to run concurrently to each other. Campbell’s prison terms will be followed by Federal supervised release for 16 years. Judge Gleason described the harm to the victims depicted in the videos as serious offenses. She stated that these crimes are not “just watching videos, they are making a market for this business,” and noted the continuing harm and pain caused to the victims. “When you are one of those viewers, you are dangerous.”
U.S. Attorney Loeffler stated, “The 9 year sentence in this case reflects the victimization perpetrated on innocent victims by Campbell. Working with our law enforcement partners to protect children is a top priority and a constant mission.”
According to Assistant U.S. Attorney Audrey J. Renschen, Campbell was under investigation for trafficking in child pornography by the Federal Bureau of Investigation (FBI) and when a search warrant was executed at Campbell’s home in Kotzebue, 73 videos, including one that was close to an hour long, were found there.
Ms. Loeffler commends the FBI, the Kotzebue Police Department, and the Alaska State Troopers, members of the Alaska Internet Crimes Against Children Task Force, for their cooperation and investigation of this case.
This prosecution is part of the Department of Justice’s ongoing Project Safe Childhood initiative which was launched to increase federal prosecutions of sexual predators of children, and to reduce the number of Internet crimes against children including child pornography trafficking. As a part of PSC, the United States Attorney’s Office has teamed with state and local agencies and organizations to increase law enforcement presence on the Internet, and to educate the public about safe Internet use, thereby reducing the risk that children might fall prey to online sexual predators. For additional information on the PSC initiative, please go to www.projectsafechildhood.gov or call the United States Attorney’s Office for the District of Alaska.
Kotzebue Man Sentenced to 9 Years Imprisonment for Sexually Exploiting ChildrenRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that a Kotzebue, Alaska man was sentenced in Federal Court in Anchorage on two counts of child sexual exploitation crimes. Culum Campbell was convicted of receipt and possession of child pornography. Campbell was using a peer to peer network to traffic child pornography, and had both distributed and received videos of children being sexually exploited.
Campbell, age 33, was sentenced January 23, 2014, by United States District Court Judge Sharon L. Gleason, to 9 years on each of the two convictions. Those sentences are to run concurrently to each other. Campbell’s prison terms will be followed by Federal supervised release for 16 years. Judge Gleason described the harm to the victims depicted in the videos as serious offenses. She stated that these crimes are not “just watching videos, they are making a market for this business,” and noted the continuing harm and pain caused to the victims. “When you are one of those viewers, you are dangerous.”
U.S. Attorney Loeffler stated, “The 9 year sentence in this case reflects the victimization perpetrated on innocent victims by Campbell. Working with our law enforcement partners to protect children is a top priority and a constant mission.”
According to Assistant U.S. Attorney Audrey J. Renschen, Campbell was under investigation for trafficking in child pornography by the Federal Bureau of Investigation (FBI) and when a search warrant was executed at Campbell’s home in Kotzebue, 73 videos, including one that was close to an hour long, were found there.
Ms. Loeffler commends the FBI, the Kotzebue Police Department, and the Alaska State Troopers, members of the Alaska Internet Crimes Against Children Task Force, for their cooperation and investigation of this case.
This prosecution is part of the Department of Justice’s ongoing Project Safe Childhood initiative which was launched to increase federal prosecutions of sexual predators of children, and to reduce the number of Internet crimes against children including child pornography trafficking. As a part of PSC, the United States Attorney’s Office has teamed with state and local agencies and organizations to increase law enforcement presence on the Internet, and to educate the public about safe Internet use, thereby reducing the risk that children might fall prey to online sexual predators. For additional information on the PSC initiative, please go to www.projectsafechildhood.gov or call the United States Attorney’s Office for the District of Alaska.
Anchorage Drug Traffickers Indicted by Federal Grand JuryRead the Press Release
Anchorage, Alaska – United States Attorney Karen L. Loeffler announced today that a federal grand jury returned a 16-count indictment against eight Anchorage-area individuals charging them with conspiracy to distribute methamphetamine and heroin, multiple counts of distribution of methamphetamine and heroin, and possession with the intent to distribute methamphetamine and heroin, conspiracy to engage in money laundering, and various firearms offenses. The indictment also contains multiple allegations seeking forfeiture of illegal items and proceeds acquired and used during the course of the alleged crimes.
According to the indictment filed on January 22, 2015, and documents filed in support of several arrest warrants issued in the case, Toa Ly (aka “Tony”) was the owner of the Fashion Nails salon on 500 Muldoon Road in Anchorage, Alaska. Between August 2014 and January 2015, law enforcement engaged in a series of undercover drug transactions with Ly, purchasing methamphetamine from him directly on at least two occasions. In other transactions, Ly would refer law enforcement to either Pao Lee (aka “Ninja”) or Murville Lavelle Lampkin (aka “Lamar”), who then distributed either methamphetamine or heroin at Ly’s direction.
On November 8, 2014, Robert Lee Rast Jr., Rennie Marie Davis, and Adam Michael Cornelison met with Ly at Fashion Nails. After leaving the business, law enforcement attempted to stop the vehicles driven by Rast and Davis, and Cornelison. Rast and Davis complied; Cornelison fled and was forced off the road by police after a chase.
Located in Rast and Davis’ vehicle was approximately one pound of methamphetamine, and two ounces of heroin. Deposit slips showing recent deposits into Ly’s Wells Fargo account were also located. In Cornelison’s vehicle was approximately one pound of marijuana and a Glock handgun. Possession of the handgun by Cornelison is illegal given his multiple prior felony convictions.
Payments for the drugs obtained from Ly or his associates were made either directly, or through deposits into bank accounts controlled by Ly that were opened in the name of the Fashion Nails salon, or other businesses registered in Ly’s name. The investigation revealed more than $200,000 in suspected drug proceeds deposited into Ly’s accounts by coconspirators and others between January 2014 and August 14, 2014.
Ly was arrested in Seattle, Washington on January 14, 2015. On that same day, law enforcement executed five search warrants at locations connected to this case. Agents seized approximately one pound of methamphetamine, approximately one-half pound of heroin, $148,000 in cash, and multiple firearms from a residence and storage locker connected to Mark Norman Hanes and Susan Jan Bradshaw.
Lee and Lampkin were also arrested on January 14, 2015. Lee was arrested after being stopped at a Wells Fargo with money to deposit into Ly’s account, and more than 5 grams of methamphetamine in his possession. Lampkin was arrested after being found in possession of more than 50 grams of methamphetamine. Both men made their initial appearance before Magistrate Judge Kevin F. McCoy on January 15, 2015, and were ordered detained.
Ly made his initial appearance before a United States Magistrate in Seattle, and was ordered detained pending his return to Anchorage by the United States Marshal.
The remaining defendants are not yet in United States custody.
The investigation is ongoing.
The case was the product of an extensive joint investigation by the Anchorage Federal Bureau of Investigation Safe Streets Task Force, the Anchorage Police Department’s Special Assignment Unit and Vice Unit, Alaska State Troopers, the United States Bureau of Alcohol, Tobacco, and Firearms (ATF), and Criminal Investigators from the United States Internal Revenue Service (IRS). Assistant United States Attorney Kyle Reardon is prosecuting the case.
If convicted of Conspiracy to Distribute and Possess with the Intent to Distribute in violation of 21 U.S.C. §§ 846 and 841, the defendants face a maximum statutory penalty of not less than 10 years in prison and up to life, a term of supervised release of not less than five years, and a $10,000,000 fine. Each conviction for Distribution of Controlled Substances in violation of 21 U.S.C. § 841 carry sentences as high as life in prison, a five-year term of supervised release, and a $10,000,000 fine. Possession of a Firearm in Furtherance of a Drug Trafficking Offense carries a mandatory five-year sentence that must be served consecutive to any other sentence imposed. A conviction for Conspiracy to Engage in Money Laundering in violation of 18 U.S.C. § 1956 carries a sentence of up to 20 years in prison, a fine of $500,000, and a five-year term of supervised release. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Anchorage Drug Traffickers Indicted by Federal Grand JuryRead the Press Release
Anchorage, Alaska – United States Attorney Karen L. Loeffler announced today that a federal grand jury returned a 16-count indictment against eight Anchorage-area individuals charging them with conspiracy to distribute methamphetamine and heroin, multiple counts of distribution of methamphetamine and heroin, and possession with the intent to distribute methamphetamine and heroin, conspiracy to engage in money laundering, and various firearms offenses. The indictment also contains multiple allegations seeking forfeiture of illegal items and proceeds acquired and used during the course of the alleged crimes.
According to the indictment filed on January 22, 2015, and documents filed in support of several arrest warrants issued in the case, Toa Ly (aka “Tony”) was the owner of the Fashion Nails salon on 500 Muldoon Road in Anchorage, Alaska. Between August 2014 and January 2015, law enforcement engaged in a series of undercover drug transactions with Ly, purchasing methamphetamine from him directly on at least two occasions. In other transactions, Ly would refer law enforcement to either Pao Lee (aka “Ninja”) or Murville Lavelle Lampkin (aka “Lamar”), who then distributed either methamphetamine or heroin at Ly’s direction.
On November 8, 2014, Robert Lee Rast Jr., Rennie Marie Davis, and Adam Michael Cornelison met with Ly at Fashion Nails. After leaving the business, law enforcement attempted to stop the vehicles driven by Rast and Davis, and Cornelison. Rast and Davis complied; Cornelison fled and was forced off the road by police after a chase.
Located in Rast and Davis’ vehicle was approximately one pound of methamphetamine, and two ounces of heroin. Deposit slips showing recent deposits into Ly’s Wells Fargo account were also located. In Cornelison’s vehicle was approximately one pound of marijuana and a Glock handgun. Possession of the handgun by Cornelison is illegal given his multiple prior felony convictions.
Payments for the drugs obtained from Ly or his associates were made either directly, or through deposits into bank accounts controlled by Ly that were opened in the name of the Fashion Nails salon, or other businesses registered in Ly’s name. The investigation revealed more than $200,000 in suspected drug proceeds deposited into Ly’s accounts by coconspirators and others between January 2014 and August 14, 2014.
Ly was arrested in Seattle, Washington on January 14, 2015. On that same day, law enforcement executed five search warrants at locations connected to this case. Agents seized approximately one pound of methamphetamine, approximately one-half pound of heroin, $148,000 in cash, and multiple firearms from a residence and storage locker connected to Mark Norman Hanes and Susan Jan Bradshaw.
Lee and Lampkin were also arrested on January 14, 2015. Lee was arrested after being stopped at a Wells Fargo with money to deposit into Ly’s account, and more than 5 grams of methamphetamine in his possession. Lampkin was arrested after being found in possession of more than 50 grams of methamphetamine. Both men made their initial appearance before Magistrate Judge Kevin F. McCoy on January 15, 2015, and were ordered detained.
Ly made his initial appearance before a United States Magistrate in Seattle, and was ordered detained pending his return to Anchorage by the United States Marshal.
The remaining defendants are not yet in United States custody.
The investigation is ongoing.
The case was the product of an extensive joint investigation by the Anchorage Federal Bureau of Investigation Safe Streets Task Force, the Anchorage Police Department’s Special Assignment Unit and Vice Unit, Alaska State Troopers, the United States Bureau of Alcohol, Tobacco, and Firearms (ATF), and Criminal Investigators from the United States Internal Revenue Service (IRS). Assistant United States Attorney Kyle Reardon is prosecuting the case.
If convicted of Conspiracy to Distribute and Possess with the Intent to Distribute in violation of 21 U.S.C. §§ 846 and 841, the defendants face a maximum statutory penalty of not less than 10 years in prison and up to life, a term of supervised release of not less than five years, and a $10,000,000 fine. Each conviction for Distribution of Controlled Substances in violation of 21 U.S.C. § 841 carry sentences as high as life in prison, a five-year term of supervised release, and a $10,000,000 fine. Possession of a Firearm in Furtherance of a Drug Trafficking Offense carries a mandatory five-year sentence that must be served consecutive to any other sentence imposed. A conviction for Conspiracy to Engage in Money Laundering in violation of 18 U.S.C. § 1956 carries a sentence of up to 20 years in prison, a fine of $500,000, and a five-year term of supervised release. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Assistant Hunting Guide Sentenced for Unlawful Take of Caribou on Arctic National Wildlife RefugeRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that a Montana resident was sentenced in U. S. District Court in Fairbanks on Tuesday, on charges that he unlawfully provided guiding services to a hunting client for the illegal taking of a caribou in the Arctic National Wildlife Refuge (ANWR).
Jason J. Kummerfeldt, 45, of Billings, Montana, pled guilty to a violation of the Lacey Act for the sale of unlawfully taken and possessed wildlife. United States Magistrate Judge Scott A. Oravec, in Fairbanks, sentenced Kummerfeldt at the time of his guilty plea. The court ordered Kummerfeldt to pay a $3,000 fine, not to do any big-game guiding or be with anyone guiding in the United States for two years, and not to hunt or be with anyone hunting in the United States for six months. Under the terms of a plea agreement, the fine will be directed to the Lacey Act Reward Account to aid future investigations of fish and wildlife violations. A second count of violating the Lacey Act was dismissed upon the court’s acceptance of the guilty plea. The charges stem from Kummerfeldt’s employment as an Alaska assistant big game guide on commercially-guided hunts in August 2009. His employer, Fair Chase Hunts, was operated within ANWR by Christopher Cassidy and Joe Hendricks.
According to Assistant U.S. Attorney Stephen Cooper, the facts brought out at the court hearing showed that Kummerfeldt guided his client in shooting and transporting a bull caribou before the client had purchased the required non-resident locking tag. As the on-site guide, Kummerfeldt was required to ascertain before the hunt that his client had purchased and possessed the tag, and was also required to report to authorities any known violations of the game laws. At the time he assisted the client in the stalk and authorized the killing shot, Kummerfeldt knew the client did not have the required tag. He failed to report this violation, and he assisted in transporting the animal back to base camp.
Investigation of Fair Chase Hunts by the U.S. Fish and Wildlife Service, Office of Law Enforcement, has thus far led to the successful prosecution of 16 guides, employees, and clients involved in at least 116 documented violations of the Lacey Act, National Wildlife Refuge Act, and Alaska State Law from 2005-2009. Those convicted on pleas of guilty included registered guide Christopher Cassidy, sentenced in June 2011, and master guide Joe Hendricks, sentenced in August 2012. Fines totaled $273,000 in all these cases, in addition to $22,500 in community service or other directed payments. In the same cases the court also imposed a total of 31 years of suspension of hunting and/or guiding privileges, and the forfeiture of four Dall sheep, two grizzly bears, one caribou, and one rifle.
Karen L. Loeffler, U.S. Attorney for the District of Alaska, noted: “Alaska’s wildlife resources are one of the many wonders that make Alaska special. With our partners at the U.S. Fish and Wildlife Service we are committed to protecting these resources and managing the important goals of access for recreation and hunting and conservation for the future by vigorous enforcement of the applicable laws and regulations.”
Ryan Noel, Special Agent in Charge of the U.S. Fish and Wildlife Service, Office of Law Enforcement for Alaska said: “The Fish and Wildlife Service is committed to protecting America’s wildlife resources that are at risk from illegal commercialization. The violations uncovered during this investigation are flagrant examples of this illegal commercialization. The sentence imposed by the court sends a message that such violations of wildlife law will not be tolerated.”
Ms. Loeffler commends the U.S. Fish & Wildlife Service, Office of Law Enforcement for Northern Alaska, for the investigation of this case.
Former Owner of Valley Dairy Sentenced to 30 Days in Prison for Lying to the USDA and Concealing Criminal Conduct of Dairy Co-OwnerRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that Karen B. Olson, of Wasilla, Alaska, was sentenced in federal court in Anchorage for making false statements to the United States Department of Agriculture (USDA) in connection with the construction and management of Valley Dairy, Inc., doing business as Matanuska Creamery, in Palmer, Alaska. She was also sentenced for concealing the criminal conduct of the former President and co-owner of the Dairy, Kyle E. Beus. Mr. Beus was recently sentenced to 60 days in prison for wire fraud and providing false statements to the USDA about his personal use of USDA grant funds intended for the construction of the Valley Dairy.
Karen B. Olson, 68, of Wasilla, Alaska, was sentenced on January 20, 2015, by U.S. District Court Judge Timothy M. Burgess to 30 days in prison and three years of supervised release. She was also fined $2000 and ordered to perform 250 hours of community service.
According to Assistant U.S. Attorney Retta Randall, who prosecuted the case, Olson was an investor in the Valley Dairy and in September 2008, its CEO. Between September 2008, and continuing through December 2008, in order to conceal the true nature of Valley Dairy finances and the losses to the Dairy caused by the illegal activity of Beus, Olson submitted false statements to USDA Rural Development to convince it to allow the State of Alaska to take a first lien position on equipment purchased with the proceeds of the USDA Valley Dairy grants. The documents submitted by Olson inflated the values of that equipment.
Prior to imposing sentence, Judge Burgess stated that the breadth and detail of the level of deceit practiced by Olsen was “frankly a little breathtaking.” Olson, a “bright, educated person,” “should have known better,” yet she was taking no responsibility for her actions. Olson blamed her “political enemies” for her presence in court. Judge Burgess pointed out to Olson that 12 members of the community came to a different conclusion about her conduct when they convicted her, and that only she was to blame for her pending incarceration.
Ms. Loeffler commends the U.S. Department of Agriculture, Rural Development, and the Federal Bureau of Investigation for the investigation of this case.
Defendant Sentenced for his Role in $25 Million Tax Fraud and Drug ConspiracyRead the Press Release
Anchorage, Alaska – Acting U.S. Attorney Kevin Feldis announced today that Samuel Peguero, aka “Niño”, a citizen of the Dominican Republic residing in Alaska, was sentenced to 13 months imprisonment, followed by one year of supervised release, for his role in a $25 million tax fraud and drug conspiracy. In addition to his prison sentence, Peguero was ordered to pay restitution of $19,090.92. Peguero pled guilty to conspiracy to six counts of aiding and abetting false claims of United States citizenship on October 10, 2014.
According to court documents, from 2008 through 2012, Peguero participated in an extensive criminal enterprise led by Joel Santana-Pierna. Joel Santana-Pierna together with his brother Abel Santana-Pierna conspired with others in an effort to import over two kilograms of cocaine into Alaska for distribution. In addition to their cocaine smuggling scheme, the organization conspired to use stolen Puerto Rican identities to file false income tax returns to obtain fraudulent income tax refunds.
Conspirators in the income tax fraud scheme obtained the stolen identities of more than 3,000 individuals, including people’s names and Social Security Numbers. Most of these stolen identities were from citizens of Puerto Rico. The conspirators also stole mail in and around the Anchorage area. The conspirators stored the stolen identities and addresses on laptop computers and paper lists. Using this stolen information, the brothers completed false returns and submitted them to the IRS. Altogether, the United States estimates that the total loss intended by members of the conspiracy exceeded $25 million.
Peguero acted as an interpreter for the conspirators. Peguero aided the Santana-Pierna brothers to submit false applications with the Alaska DMV to obtain fraudulent identification documents. He also helped the conspirators negotiate U.S. Treasury checks at local banks, knowing that the checks bore the forged endorsements of the conspirators.
“This conspiracy to defraud the United States government is the largest in Alaska state history,” according to Special Agent in Charge Teri Alexander of IRS Criminal Investigation. “While Peguero may have played a small role in a big picture, this sentencing today is a stark warning to anyone that would endeavor to provide aid and assistance to criminals.”
“Tax fraud and identity theft are serious crimes that cheat us all. Anyone who commits the crimes, or helps others to commit the crimes, should expect to be arrested and sent to jail,” stated Acting U.S. Attorney Kevin Feldis.
Misael Polanco-Villa, Nicolas Jimenez-Sanchez, Isaac Amparo-Vazquez, Randin Paredes Henriquez, John Doe, a/k/a Japhet Soto Santiago, a/k/a Luis Angel, Wedys Ramirez-Javier, Fatima Aguilar Martinez, Melissa Duran-Muniz, and Hilda Josephine Hernandez McMullen were also indicted as conspirators in Joel Santana-Pierna’s scheme.
The case was jointly prosecuted by Assistant U.S. Attorneys Thomas C. Bradley, James Barkeley, and Stephanie C. Courter of the U. S. Attorney’s Office for the District of Alaska. The case was investigated by the Internal Revenue Service Criminal Investigation (IRS-CI), U.S. Immigration and Customs Enforcement (ICE), which oversees Homeland Security Investigations (HSI), the U.S. Postal Inspection Service (USPIS), the U.S. State Department’s Diplomatic Security Service, and the Drug Enforcement Administration (DEA). Additional assistance was provided by the Tax Division of the United States Department of Justice as well as the U.S. Attorney’s Offices for the District of New Jersey, the Eastern District of Pennsylvania, and the Southern District of New York.Cooper Landing Man Living in Illegal Cabin on Forest Service Land Sentenced to 12 Months in Jail for being a Felon in Possession of FirearmsRead the Press Release
Anchorage, Alaska – Acting U.S. Attorney Kevin Feldis announced today that a Cooper Landing man was sentenced in federal court in Anchorage for being a felon in possession of firearms.
John J. Soper, 57, of Cooper Landing, was sentenced today by United States District Court Judge Timothy M. Burgess, to 12 months in prison.
According to Assistant U.S. Attorney Aunnie Steward, Alaska State Troopers were investigating a series of burglaries and thefts in the Cooper Landing area when they received information that the suspect was an individual living in an illegal cabin built on U.S. Forest Service land outside of Cooper Landing. Following up on the information, a trooper and a Forest Service Ranger found Soper, a convicted felon, living in a cabin he had built illegally on Forest Service land. They also found that he had four firearms in his possession, which he is prohibited from possessing as a felon.
U.S. Attorney Karen L. Loeffler commends the U.S. Forest Service Law Enforcement, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Alaska State Troopers for the investigation of this case.
Members of Mail Theft Ring Sentenced to 42 Months in PrisonRead the Press Release
Anchorage, Alaska – Acting U.S. Attorney Kevin Feldis announced today that an Anchorage woman has been sentenced in federal court in Anchorage for bank fraud and aggravated identity theft.
Elizabeth Ingalsbe, 45, of Anchorage, was sentenced today by United States District Court Judge Sharon L. Gleason, to 42 months in prison.
According to Assistant U.S. Attorney Aunnie Steward, Ingalsbe, as a member of a mail theft ring in Anchorage, cashed checks at the bank that had been stolen from victims’ mailboxes. The checks were altered to indicate a false payee and to increase the payment amount. The stolen checks included payments for rent, insurance premiums, a donation to a veteran’s memorial, and bill payments. The amounts were generally $100 or less and were falsely increased to $900 before Inglasbe cashed the checks. Ingalsbe victimized approximately 21 individuals and organizations.
The court noted Ingalsbe’s lengthy criminal history and the emotional impact to the victims who indicated that the safety and security in their home and community had been compromised by these crimes as reasons for the sentence imposed.
Acting U.S. Attorney Kevin Feldis stated, “Identity theft is a worldwide problem that can have devastating impact on its victims. In this case, the defendant victimized over 20 local citizens, putting their bank accounts, credit ratings, reputations and good names at risk. It is appropriate that the sentence imposed is significant and serves to deter others from committing similar crimes.”
United States Attorney Karen L. Loeffler commends the United States Postal Inspection Service for the investigation of this case.Anchorage Man Sentenced to more than 21 Years for Drug Trafficking, Causing Death of Young WomanRead the Press Release
Anchorage, Alaska B U.S. Attorney Karen L. Loeffler announced today that an Anchorage man was sentenced by United States District Court Judge Timothy M. Burgess to serve 262 months in federal prison for his role in a drug trafficking conspiracy that led to the death of a young woman.
Dwight Williams, 51, of Anchorage, Alaska previously pled guilty to participating in a drug conspiracy to distribute significant quantities of heroin and methamphetamine. As part of the conspiracy, in early August 2013, Williams and a co-conspirator sold approximately 14 grams of methamphetamine in exchange for $1350.
Williams also admitted that, just a few weeks later, he distributed heroin to a young woman, S.C., and that giving heroin to S.C. resulted in her death from an overdose. Specifically, Williams admitted that on August 26, 2013, he and S.C. traveled to a hotel in Anchorage where, in the early morning hours, Williams supplied S.C. with the heroin that ultimately caused her death. After distributing heroin to S.C., Williams took steps to conceal his involvement in her death by making false claims to law enforcement.
Just three days after S.C.’s tragic death, Williams continued his drug trafficking activities, this time working with others to distribute more than 100 grams of heroin and almost 30 grams of nearly pure methamphetamine. On August 29, 2013, Williams and a co-conspirator traveled to another hotel in Anchorage where the group rented a room. Williams arrived at the hotel on that date already in possession of both heroin and methamphetamine that he and his associates intended to distribute.
Upon his release from prison, Williams will remain under court supervision for five years. He was also ordered by Judge Burgess to forfeit a Cadillac Escalade that he used to facilitate his drug trafficking activities.
In sentencing Williams, Judge Burgess noted that he found it difficult to emphasize how sad this case is for the victims. He also called Williams’ actions extremely reckless and cited the need for the sentence in the case to protect the public from future crimes by Williams.
In announcing the sentence, U.S. Attorney Loeffler praised the Drug Enforcement Administration, the Anchorage Police Department, and Homeland Security Investigations for their investigation of the case.
Ketchikan Resident Sentenced to Prison for Assault on Federal OfficerRead the Press Release
Anchorage, Alaska – U.S. Attorney Karen L. Loeffler announced today that a Ketchikan resident was sentenced in federal court in Juneau for assault on a federal officer.
Jon William Munhoven, 57, a resident of Ketchikan, was sentenced by United States District Court Judge Timothy M. Burgess to 48 months of incarceration and three years of supervised release.
According to Assistant U.S. Attorney Jack S. Schmidt and Special Assistant United States Attorney Lt. Cmdr. Stanley P. Fields, who jointly prosecuted the case, on September 2, 2013, the United States Coast Guard (USCG) at Coast Guard Station Ketchikan dispatched six personnel in a 25-foot response boat small (RBS) in response to a call for help from a mariner who had been assaulted on his vessel. After travelling through thick fog, the RBS contacted the mariner who had a bloody nose, a female passenger, and Jon William Munhoven. Munhoven was irate and hostile during the initial contact and was ordered to disembark the mariner’s vessel by the USCG Boarding Team. Munhoven was placed in handcuffs and seated on the aft deck box of the RBS. Munhoven refused to listen to the instructions of the USCG Boarding Team and would not calm down. He then became actively resistant to the USCG Boarding Team. As the members of the boarding team were attempting to safely control Munhoeven, he intentionally kicked one of the USCG Boarding Team Members in the face with a shod foot, using it as a dangerous weapon and causing bodily injury to the USCG Boarding Team Member.Judge Burgess noted the seriousness of the offense, defendant’s extensive violent criminal history that included numerous felony and misdemeanor assaults, sexual assaults, robbery, and menacing with a firearm, and deterrence of the defendant and others as reasons for the sentence imposed.
Ms. Loeffler commended the United States Coast Guard 17th District Legal Office, United States Coast Guard Investigative Service (USCGIS), and Ketchikan Police Department for the investigation leading to the prosecution of Munhoven.
Former California Resident Sentenced for Failing to Register as a Sex OffenderRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that a former California resident was sentenced in federal court in Juneau for failing to register as a sex offender.
Jeremy Robert Reef, 39, a former resident of California, was sentenced by United States District Court Judge Timothy M. Burgess to five years of probation with the condition that he immediately registers upon release. Reef has been in custody since his arrest on July 1, 2014.
Assistant U.S. Attorney Jack S. Schmidt, who prosecuted the case, stated that Reef was convicted of a misdemeanor sex offense in California in 2001. Reef was required to register for a period of 15 years as a result of the conviction. Reef previously failed to register on two occasions in California and was convicted for those offenses in 2008. Reef subsequently moved to Reno, Nevada in 2009, however, that was the last time he registered. In November 2013, Reef travelled to Alaska and failed to register with local authorities. Reef was contacted by local authorities in April 2014 and was advised of his responsibility to register. Reef again failed to register, which lead to his indictment and arrest in this case.
Judge Burgess noted the seriousness of the crime and that the sentence imposed should deter others from failing to register in the future.
This case was investigated by the U.S. Marshal Service.International Wildlife Investigation Results in Felony Conviction and Loss of Guiding and Hunting PrivilegesRead the Press Release
Anchorage, Alaska – U.S. Attorney Karen Loeffler announced today that John Katzeek, 65, a Haines area big game guide was sentenced by U.S. District Court Judge Timothy M. Burgess for a felony violation of the Lacey Act to four years of probation along with the loss of hunting and guiding privileges. The felony conviction resulted from a trial in Juneau, Alaska last January where a jury convicted the guide for falsifying paperwork in order to conceal illegal hunting activity.
In 2014, the United States filed charges against Katzeek, a long-time big game guide in the Haines area, for the illegal take of wildlife and concealing the illegal nature of guided hunts by falsification of paperwork to the Alaska Department of Fish and Game. Katzeek went to trial and was convicted for providing false information to the state of Alaska on guide-required paperwork. Specifically, Katzeek falsified the paperwork by intentionally failing to list the assistant guide who actually conducted the hunt, provided the name of another assistant guide who did not participate on the hunt, and claimed that he guided the hunt when he remained in town while the hunt took place. Katzeek also falsified the amount of meat that was harvested from the animal when in fact little to no meat was harvested.
The guided hunt occurred in May 2011, in the Haines, Alaska area. As part of his felony conviction, Katzeek was sentenced to four years of probation due to his age and certain medical reasons, fined $2,000 and was ordered to perform 200 hours of community service. During the term of probation, Katzeek is prohibited from guiding big game hunters and is prohibited from hunting game anywhere in the world, including for subsistence in Alaska and Canada. Because of the felony conviction, Katzeek is precluded from possessing any firearms.
The conviction was the result of an extensive joint United States-Canadian investigation. Starting in January 2013, Canada Crown prosecutors in Alberta, and Yukon Territory Canada, charged approximately 17 subjects with 55 violations under Wild Animal and Plant Protection and the Regulation of International and Interprovincial Trade Act (WAPPRIITA). As of this date, eight defendants have been charged and sentenced in Canada, Alaska, and federal court, which resulted in the issuance of over $146,000 in fines, the forfeiture of 10 wildlife trophies, $6800 in restitution to the state of Alaska, the forfeiture of a Piper Supercub aircraft, and over $100,000 in forfeited equipment. Several Canadian trials and United States trials are scheduled for the spring and summer of 2015.
Ms. Loeffler commends the United States Fish and Wildlife Service; Alaska Wildlife Troopers; Environment Canada; Yukon Conservation Officer Service; Alberta Fish and Game; Parks Canada; British Columbia Conservation Officer Service; and the Public Prosecution Service of Canada for the international cooperation extended in the investigation of these cases.
Mailman Sentenced for Throwing Away MailRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that an Anchorage man was sentenced in federal court in Anchorage for one count of obstruction of mail.
Alfonso Pitpit, 36, of Anchorage, pled guilty and was sentenced yesterday by United States Magistrate Judge Deborah Smith to one year of probation and a fine of $1,000.
Pitpit was an employee of the United States Postal Service as a letter carrier at the Russian Jack facility in Anchorage. On October 4, 2014, a witness observed Pitpit empty two trays of first class mail into two different garbage cans along his mail route. The witness notified the Post Office and the mail was recovered and delivered. Pitpit admitted that he threw the mail away.
Magistrate Judge Smith noted the importance of reliable mail delivery and the need to deter others from cutting corners as Pitpit had done.
Ms. Loeffler commends the United States Postal Service, Office of Inspector General for the investigation of this case.Former Juneau Carpenters Union Official SentencedRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that a former union financial secretary was sentenced in federal court in Juneau for embezzling funds from Carpenters Local Union 2247.
Jonathan H. Smith, 42, of Juneau, was sentenced by United States District Court Judge Timothy M. Burgess to five years of probation with the condition that he serve four months in community confinement, perform 250 hours of community work service and pay full restitution of $41,770.47.
Assistant U.S. Attorney Kevin Feldis, who prosecuted the case, stated that between June 2006 and May 2012, Smith held the elected position of Financial Secretary for Carpenters Local Union 2247 (LU 2247) in Juneau, which is a labor union representing approximately 150 members. As Financial Secretary, Smith was an officer of LU 2247, and responsible for making deposits in the union bank account, paying bills, co-signing checks and managing the day-to-day business of the union. This was an elected unpaid position. During this time period, Smith was also employed by the Alaska Regional Council of Carpenters as Business Agent from 2004 until 2012, earning an annual salary ranging from $66,000 to $93,000.
Beginning in approximately April 2007, and continuing until May 2012, Smith improperly used the union’s ATM/debit card and the union checkbook to steal money from LU 2247. Smith used the ATM/debit card and union checks to make cash withdrawals and to use union money to pay for personal expenditures including personal travel, meals at restaurants, purchasing alcohol, eating and drinking at bars and to buy consumer goods throughout Alaska and elsewhere in the country.
Smith also withdrew thousands of dollars in union funds from the union’s First National Bank of Alaska account that he used to gamble at several casinos in Las Vegas and Washington State. He was not authorized to make any of these non-union purchases and cash withdrawals. In total, Smith knowingly and willfully embezzled, stole and illegally converted union funds to his own personal use in the amount of $41,770.47.
Judge Burgess noted that Smith had abused a position of trust, and that his sentence should deter others from engaging in similar crimes.This case was investigated by the U.S. Department of Labor, Office of Labor Management Standards.
Anchorage Woman Indicted for Making False Tax Claims Against the GovernmentRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that Pepe Anetipa, 58, was indicted on 28 counts of making false, fictitious, and fraudulent claims against the government. According to the indictment, for tax year 2011, Pepe Anetipa filed falsified tax returns claiming total refunds of at least $202,859.00. Anetipa was arrested in Washington State on December 2, 2014, and arraigned in federal court in Anchorage, on December 18, 2014. She pleaded not guilty. Trial is set for February 9, 2015.
According to the Indictment, Anetipa moved from American Samoa to Anchorage, Alaska, in approximately July 2011. Anetipa obtained a State of Alaska business license on February 6, 2012, for Triple-H Tax and Services. Citizens of the United States Territory of American Samoa are issued social security numbers by the Social Security Administration; however, they are not required to file tax returns with the Internal Revenue Service if all of their income was derived from sources in American Samoa.
Allegedly, Anetipa used wage information and tax withholding reported to residents of American Samoa on a “Form W-2AS American Samoa Wage and Tax Statement” and transferred the information to a regular “Form W-2 Wage and Tax Statement”. Anetipa also changed the addresses on the Forms W-2 to be either Texas or Alaska addresses instead of the Pago Pago, American Samoa addresses. The altered Forms W-2 gave the tax returns the false appearance that the income was earned in the United States rather than America Samoa and that federal tax withholding was paid into the U.S. system. Anetipa then submitted the altered Forms W-2 with tax returns she prepared. Anetipa submitted these false tax returns knowing that none of the individuals who had tax returns prepared by Anetipa earned wages outside of America Samoa. The refund claims were materially false because, in fact, no federal taxes had been withheld, no credits were due, and therefore no refund was due and owing.
An indictment is merely an accusation of charges and the defendant is presumed innocent until proven guilty. The defendant is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt. Making false claims against the government carries a sentence of up to five years for each false return.
The case is being prosecuted by Assistant U.S. Attorney Thomas Bradley of the U. S. Attorney’s Office for the District of Alaska. The case was investigated by the Internal Revenue Service Criminal Investigation (IRS-CI).
Drilling Operator Sentenced for Environmental and Maritime Crimes in AlaskaRead the Press Release
Anchorage, Alaska – U.S. Attorney Karen L. Loeffler announced that Noble Drilling (U.S.) LLC was sentenced today for committing eight felony environmental and maritime crimes arising out of its operation of the drill ship Noble Discoverer and the drilling unit Kulluk in violation of federal law in Alaska in 2012. These convictions are the result of a joint investigation between the U.S. Coast Guard Investigative Service and the U.S. Environmental Protection Agency Criminal Investigation Division. The case was prosecuted by the United States Attorney’s Office for the District of Alaska and the Department of Justice’s Environmental Crimes Section.
Noble was sentenced to pay $12.2 million dollars in fines and community service payments and to serve a four year period of probation during which time it must implement a comprehensive Environmental Compliance Plan. In addition, Noble’s parent corporation, Noble Corporation plc, headquartered in London, England, has agreed to implement an Environmental Management System for all Mobile Offshore Drilling Units (MODUs) owned or operated by Noble Corporation plc and its direct and indirect subsidiaries worldwide.Noble Drilling (U.S.) LLC was convicted of five counts of knowingly violating the Act to Prevent Pollution from Ships (APPS), one count of knowing violating the Nonindigenous Aquatic Nuisance Prevention and Control Act, and two counts of willfully violating the Ports and Waterways Safety Act. Seven of these counts are for Noble’s operation of the Noble Discoverer, and one count for the operation of the MODU Kulluk.
At the time of the offenses, the Noble Discoverer was operating under contract with Shell Offshore, Inc. and Shell Development, Ltd. for the purpose of drilling in the arctic in Alaska. During the 2012 drilling season, Noble was the operator and bare boat charterer of the motor vessel Noble Discoverer and the drilling operator of the MODU Kulluk. In 2012, the Kulluk and the Noble Discoverer made several U.S. port calls in Washington and Alaska on their way to the Shell drilling site in the Chukchi Sea off the coast of Alaska. After leaving the drill site, the Kulluk ultimately ran aground off the coast of Unalaska when it broke free from its tow in bad weather, and the Noble Discoverer was dead-ship towed from Dutch Harbor to Seward due to failures with its main engine and other equipment.
A total of $4 million was paid by Noble in the form of community service payments; $2,500,000 will go to the International Arctic Research Center located at the University of Alaska Fairbanks, $1,000,000 will go to the National Fish and Wildlife Foundation, Alaskan Arctic Fund, and $500,000 will go to the Arctic Research Consortium of the United States. All of these funds will be used for research and projects designed to study and/or benefit the Arctic and/or the natural resources or wildlife contained therein near Alaska.
In addition, the Court has ordered that $512,500 of the $8.2 million fine be awarded to a person who provided substantial information leading the conviction of Noble in this case. This award was made under the provisions of the Act to Prevent Pollution from Ships, which provides that the Court may award an amount equal to not more than ½ of the fine imposed for a conviction of that statute to the person giving information leading to conviction. In this case, the United States notified the Court that there was an individual who provided information that resulted in Noble’s conviction on Count 1 of the Information, and requested that the Court award one-half of the fine for that count to this individual.
The APPS award provision serves a valuable law enforcement purpose by encouraging those most likely to know of the illegal conduct to report it and cooperate with law enforcement. Because the discharge of oily waste typically takes place in the middle of the ocean in international waters, the only persons likely to know about the conduct and the falsification of the ORB are the crew members. Absent crew members with firsthand knowledge of the illegal conduct coming forward, APPS violations are otherwise extremely difficult to uncover. The government’s success in detecting the illegal activity and obtaining sufficient evidence to support investigations and prosecutions is dependent upon the willingness of a crew member to step forward. In turn, a crew member must assess the risks associated with coming forward, such as the possibility that the crew member will lose relatively lucrative employment and be blacklisted and barred from working in the marine shipping industry in the future. A substantial monetary award, as provided by APPS, both rewards the crew member for taking those risks and provides an incentive for other crew members to come forward and report illegal conduct on vessels in the future.
Chief Judge Ralph R. Beistline accepted the plea agreement entered into between the parties, and sentenced Noble consistent with that agreement. As special condition of the plea agreement, Judge Beistline ordered that Noble implement the Environmental Compliance Plan, including the third party and independent auditing requirements. Judge Beistline noted that all of us are victims of these crimes, and that we all have to do everything we can as a community to protect the environment.
Ms. Loeffler commended the U.S. Coast Guard Investigative Service and the U.S. Environmental Protection Agency Criminal Investigation Division for the investigation leading to the successful prosecution of this case.North Slope Worker Sentenced for Tax CrimesRead the Press Release
Anchorage, Alaska – United States Attorney Karen L. Loeffler announced today that James R. Back, 60, of Soldotna, was sentenced in U.S. District Court in Anchorage. Chief Judge Ralph Beistline sentenced Back to 16 months in prison and a $10,000 fine, to be followed by one year of supervised release. In addition, Back paid over $17,000 for the cost of prosecution and paid back taxes in the amount of $113,286.
During the sentencing, Judge Beistline commented that, “Back wanted all of the privileges and none of the responsibilities of being a citizen.” He called Back’s tax avoidance arguments “senseless,” “frivolous,” and “groundless.”
In October, Back was convicted by a jury on all seven federal tax crimes for which he was charged. Back, who is employed by Alyeska Pipeline Service Company as a pipeline technician at Pump Station One in Prudhoe Bay, was found guilty of filing false 2006, 2007 and 2008 individual income tax returns, and of failure to file his 2009, 2010, 2011 and 2012 returns. Evidence presented at trial showed that Back earned over $125,000 in wages during each of the prosecution years, yet falsely claimed on the 2006, 2007, and 2008 returns that his wages were zero. For the years 2009-2012, Back simply failed to file.
Other evidence at trial established that Back contributed over $140,000 to a retirement plan during the prosecution years, had investment accounts worth hundreds of thousands of dollars, owned real estate in the Kenai Peninsula Borough, and purchased over $400,000 in gold and silver bullion. Back represented himself at the trial, and argued to the jury that taxation was immoral and unfair, and that he simply refused to submit to it anymore. He argued that the Alaska Permanent Fund Dividend was not taxable, even though he applied for and received it each year. He also argued that there was no evidence that state or federal laws applied to him. Back ignored prior warnings from his employer, his supervisor, the IRS, and a United States Tax Court Judge that his arguments were frivolous.
According to witness testimony, Back used a scheme similar to one promoted by Peter Hendrickson of Michigan. Hendrickson operates a website known as “Lost Horizons” and wrote a book called “Cracking the Code” which promotes the “zero wages” tax evasion scheme. According to federal court records, in 1992 Hendrickson was convicted of failure to file tax returns and firebombing a Michigan post office on April 16, 1990, and served 21 months in prison. In 2010, Hendrickson was sentenced to another 33 months in federal prison for tax crimes, including filing false returns and failure to file.
“This sentence should serve as a warning to those who might think there’s a secret recipe to avoid paying their fair share of taxes, taxes that the vast majority of Americans pay each and every year,” said Assistant Special Agent in Charge Steven Bellis, IRS Criminal Investigation. “IRS CI strives to ensure that those paying their honest share can feel confident that the playing field is level. James Back tried to play by his own set of made-up rules. Time and again, the courts have rejected such frivolous arguments. There is no way to opt out of the tax system.”
Ms. Loeffler commends the Internal Revenue Service, Criminal Investigation, for the investigation and prosecution of this case.Nevada Pair Pleads Guilty to Conspiring to Distribute Methamphetamine and Launder Drug ProceedsRead the Press Release
Anchorage, Alaska – Acting U.S. Attorney Kevin R. Feldis announced today that Billy Cooks, 36, aka “Red Dollaz,” pled guilty to conspiracy to distribute a controlled substance, namely methamphetamine, and conspiracy to commit money laundering. Earlier this week, Cooks’ co-conspirator, E’lala Frank, 36, also plead guilty to conspiracy to commit money laundering. A third conspirator, Dawud Johnson, previously plead guilty to related charges of attempting to possess methamphetamine and possessing a firearm during and in relation to a drug trafficking offense.
According to Assistant U.S. Attorney Kimberly Sayers-Fay, Cooks and Johnson forged a drug trafficking partnership that revolved mostly around methamphetamine. The two worked together to send methamphetamine from Las Vegas to Anchorage. Cooks enlisted Frank to send the methamphetamine through the mail to contacts Johnson had in Alaska. From December 2, 2013, through January 21, 2014, the conspirators sent three packages of methamphetamine. They were caught when attempting to send the third package.
Cooks and Frank admitted to conspiring to transmit drug trafficking proceeds through a variety of means in order to obscure and conceal the fact that the funds were from drug trafficking. The conspirators deposited and withdrew drug trafficking proceeds using at least two bank accounts.
Conspiracy to Distribute a Controlled Substance carries a sentence of imprisonment up to 40 years and a fine not to exceed $5,000,000. The money laundering conspiracy carries a maximum 20 year sentence and a $500,000 fine. Sentencing for both defendants is set for February 27, 2015. Defendant Johnson was previously sentenced to 15 years in prison.
The case was prosecuted by Assistant U.S. Attorneys Kim Sayers-Fay of the U. S. Attorney’s Office for the District of Alaska. The case was investigated by the Internal Revenue Service Criminal Investigation (IRS-CI) and the Drug Enforcement Administration (DEA).Massage Parlor Owner Indicted for Structuring and Sex TraffickingRead the Press Release
Anchorage, Alaska – First Assistant U.S. Attorney Kevin R. Feldis announced today that Yin Mei Tran Lau was indicted for structuring financial transactions in violation of federal law. In addition, Yin Mei Tran Lau has been charged by the State of Alaska with Sex Trafficking in the Third Degree for her role in managing an alleged prostitution enterprise. Yin Mei Tran Lau owns and operates Yin’s Massage Therapy located in Anchorage. As alleged in court documents, beginning as early as 2009, Yin Mei Tran Lau operated Yin’s Massage Therapy as a front for prostitution.
The federal indictment charges that in January 2009, over the course of approximately one week, Yin Mei Tran Lau attempted to structure bank transactions. Structuring occurs when an individual knowingly layers cash deposits or withdrawals under the $10,000 reporting threshold so as to evade reporting requirements mandated by the Bank Secrecy Act. Yin Mei Tran Lau allegedly used some of this illegally structured money to purchase real property in Anchorage.
The State of Alaska alleges that from 2011 to 2014, Yin Mei Tran Lau operated Yin’s Massage Therapy as a front for prostitution. An unsealed affidavit by detectives investigating the case indicates that the clientele was almost entirely men, that the only women besides Yin Mei Tran Lau in the business appear to actually reside at the business, and that the women working at Yin’s Massage Therapy would offer to perform sexual acts for a fee. Moreover, Yin Mei Tran Lau allegedly transported multiple women in and out of Alaska for purposes of prostitution.
The case was jointly prosecuted by Assistant U.S. Attorney Thomas Bradley of the U. S. Attorney’s Office for the District of Alaska and Adam Alexander of the State of Alaska Department of Law’s Office of Special Prosecutions. The case was investigated by the Innocence Lost Task Force, consisting of participation from the Internal Revenue Service Criminal Investigation (IRS-CI), Federal Bureau of Investigations (FBI), Homeland Security Investigations (HSI) and the Anchorage Police Department.
An indictment merely alleges that crimes have been committed, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt. If convicted of structuring, Yin Mei Tran Lau faces five years imprisonment as well as fines. If convicted of sex trafficking in the third degree as charged by the State of Alaska, Yin Mei Tran Lau faces up to five years of imprisonment. Yin Mei Tran Lau is scheduled for arraignment on her State Court charges on December 16, 2014, at 10:00 a.m.Drilling Company Charged with Environmental and Maritime Crimes in AlaskaRead the Press Release
Anchorage, Alaska - Noble Drilling (U.S.) LLC was charged with environmental and maritime crimes for operating the drill ship Noble Discoverer and the drilling unit Kulluk in violation of federal law in Alaska in 2012, announced Karen L. Loeffler, U.S. Attorney for the District of Alaska, and Sam Hirsch, Acting Assistant Attorney General for the Environment and Natural Resources Division of the U.S. Department of Justice.
Under the terms of a plea agreement filed in federal court today, Noble will plead guilty to eight felony offenses, pay $12.2 million dollars in fines and community service payments, implement a comprehensive Environmental Compliance Plan, and will be placed on probation for four years. In addition, Noble’s parent corporation, Noble Corporation plc, headquartered in London, England, will implement an Environmental Management System for all Mobile Offshore Drilling Units (MODUs) owned or operated by Noble Corporation plc and its direct and indirect subsidiaries worldwide.
Noble Drilling (U.S.) LLC was charged in an eight-count Information with knowingly failing to maintain an accurate Oil Record Book and an accurate International Oil Pollution Prevention certificate, knowingly failing to maintain a ballast water record book, and knowingly and willfully failing to notify the U.S. Coast Guard of hazardous conditions aboard the drill ship Noble Discoverer. At the time of the offenses, the Noble Discoverer was operating under contract with Shell Offshore, Inc. and Shell Development, Ltd. for the purpose of drilling in the arctic in Alaska.
During the 2012 drilling season, Noble was the operator and bare boat charterer of the motor vessel Noble Discoverer and the drilling operator of the MODU Kulluk. The Kulluk was a conical-shaped vessel, weighing 27,968 gross tons, and measuring 265.7 feet in diameter. The Kulluk was not self-propelled, but rather had to be towed. The Noble Discoverer, a mobile drill ship, weighed approximately 15,296 gross tons, measured 572 feet long, and was propelled by a single main engine. In 2012, the Kulluk and the Noble Discoverer made several U.S. port calls in Washington and Alaska on their way to the Shell drilling site off the coast of Alaska. After leaving the drill site, the Kulluk ultimately ran aground off the coast of Unalaska when it broke free from its tow in bad weather, and the Noble Discoverer was dead-ship towed from Dutch Harbor to Seward due to failures with its main engine and other equipment.
Under the terms of the plea agreement, Noble admits that it knowingly made false entries and failed to record its collection, transfer, storage, and disposal of oil in the Noble Discoverer’s and the Kulluk’s Oil Record Books in 2012. Oil Record Book entries falsely reflected that the Noble Discoverer’s Oil Water Separator (OWS) was used during periods of time when in fact the OWS was inoperable. Under the International MARPOL protocol and the Act to Prevent Pollution from Ships, all overboard discharges must pass through an operating OWS to insure that water pumped overboard does not contain more than 15ppm of oil.
Noble also admits that it failed to log numerous transfers and storage of machinery space bilge water and waste oil and failed to log that the Noble Discoverer’s oil content meter audible alarm was nonfunctional. Noble also made modifications to the Noble Discoverer’s new OWS system after the OWS system passed inspections by the Classification Society and the U.S. Coast Guard. Noble did not inform the U.S. Coast Guard or the Classification Society of the modifications and did not receive an International Oil Pollution Prevention certificate that documented the unapproved decanting system, the increased storage, or the new OWS piping arrangement.
Noble had problems managing the bilge and wastewater that was accumulating in the engine room spaces of the Noble Discoverer. This and other conditions led to a number of problems. Noble devised a makeshift barrel and pump system to discharge water that had entered the vessel’s engine room machinery spaces directly overboard from the Noble Discoverer without processing it through the required pollution prevention equipment as required by law. Noble failed to notify the Coast Guard about this system, and took steps to actively hide the fact that it was being used. These false and missing record entries and the use of the illegal overboard discharge system all violated the Act to Prevent Pollution from Ships.
In the factual basis of the plea agreement, Noble also admits that it negligently discharged machinery space bilge water from the Noble Discoverer into Broad Bay, Unalaska, on July 22, 2012. While anchored in Dutch Harbor, the Noble Discoverer’s bilge holding tank 27S overflowed and went overboard, creating a sheen in Broad Bay.
The Nonindigenous Aquatic Nuisance Prevention and Control Act requires vessels to maintain accurate ballast records reflecting the source of ballast water in the ballast water tanks, discharges from the tanks, and the total volume of ballast water onboard. By design, water ballast tanks should only contain uncontaminated seawater. Noble pumped oily skimmer tank fluids and deck water with a sheen into several ballast tanks on the Noble Discoverer. Noble then discharged those ballast tanks directly overboard instead of properly discharging the water through the OWS or transferring to a shore-side facility. Noble failed to record the transfers to the ballast tanks and the subsequent discharges in the ballast log.
The Ports and Waterways Safety Act regulations require that the owner, operator, or person in charge of a vessel must immediately notify the nearest Coast Guard office whenever there is a hazardous condition, either aboard a vessel or caused by the vessel or its operation. Noble knowingly and willfully failed on several occasions in 2012 to notify the U.S. Coast Guard of hazardous conditions aboard the Noble Discoverer. There were conditions aboard the Noble Discoverer that may have adversely affected the safety of the Noble Discoverer, other vessels, and the environmental quality of ports, harbors, and navigable waterways of the United States. During 2012, the Noble Discoverer experienced numerous problems with its main propulsion system, including its main engine and its propeller shaft, resulting in engine shut-downs, equipment failures, and unsafe conditions. At times, the condition of the Noble Discoverer’s main engine also created high levels of exhaust in the engine room, multiple sources of fuel and oil leaks, and backfires. Noble acknowledges that it failed to report any of these hazardous conditions to the U.S. Coast Guard.
The Noble Discoverer was initially detained in Seward by the Officer In Charge, Marine Inspection for the Western Alaska zone, following a Coast Guard Port State Control examination on November 29, 2012. This case was investigated by the U.S. Coast Guard Investigative Service and the U.S. Environmental Protection Agency Criminal Investigation Division and is being prosecuted by the Department of Justice’s Environmental Crimes Section and the United States Attorney’s Office for the District of Alaska.Anchorage Felon Charged with Federal Firearms CrimeRead the Press Release
Anchorage, Alaska – U.S. Karen L. Loeffler announced today that a local man was arraigned in federal court in Anchorage on one count of felon in possession of a firearm.
26 year-old Eric Ramirez Nebreja was charged in a one-count indictment.
According to the information presented to the court, Nebreja possessed a Glock 40 caliber pistol on October 9, 2014. Nebreja has two prior felony convictions from the State of Alaska for assault in the second degree and misconduct involving weapons in the third degree.
Special Assistant United States Attorney Erin W. Bradley, who presented the case to the grand jury, indicated that the law provides for a maximum total sentence of 10 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Anchorage Police Department conducted the investigation leading to the indictment in this case. SAUSA Bradley is a prosecutor in the U.S. Attorney’s Office funded by the Municipality of Anchorage for the purpose of prosecuting gang-related and violent crime cases.
An indictment is only a charge and is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.Anchorage Felon Charged with Federal Firearms CrimeRead the Press Release
Anchorage, Alaska – U.S. Karen L. Loeffler announced today that a local man was arraigned in federal court in Anchorage on one count of felon in possession of a firearm.
26 year-old Aaron Michael Sullivan was charged in a one-count indictment.
According to the information presented to the court, Sullivan possessed a Taurus .44 magnum revolver on October 6, 2014. Sullivan has two prior felony convictions from the State of Alaska for assault in the third degree and misconduct involving weapons in the third degree.
Special Assistant United States Attorney Erin W. Bradley, who presented the case to the grand jury, indicated that the law provides for a maximum total sentence of 10 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Anchorage Police Department conducted the investigation leading to the indictment in this case. SAUSA Bradley is a prosecutor in the U.S. Attorney’s Office funded by the Municipality of Anchorage for the purpose of prosecuting gang-related and violent crime cases.
An indictment is only a charge and is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.Third Employee of Westward Seafoods Sentenced for Clean Air Act CrimeRead the Press Release
Anchorage, Alaska – U.S. Attorney Karen L. Loeffler announced today that Bryan Beigh, 48, a former powerhouse operator for Westward Seafoods, Inc. (Westward) was sentenced in U.S. District Court, in Anchorage, by Chief U.S. District Court Judge Ralph R. Beistline, to serve three years of probation and pay a $750 fine for tampering with the pollution control monitoring equipment required under the Clean Air Act at the Westward seafood processing facility in Dutch Harbor.
Kevin Feldis, First Assistant United States Attorney, and Karla Perrin, EPA Regional Criminal Enforcement Counsel, who prosecuted the case, argued to the court that Beigh participated in this scheme to tamper with equipment and conceal the failure to operate pollution control equipment in order to make his job easier, without any thought of the potential consequences to others.
Westward has operated a sizeable seafood processing facility in Dutch Harbor since 1999, processing approximately 250 million pounds of seafood per year. Westward is a wholly owned subsidiary of Maruha-Nichiro Holdings, Inc., a Japanese-based company, and maintains its headquarters in Seattle, Washington. The Dutch Harbor facility generates its own electricity with three diesel-fueled generators contained in its powerhouse building. Air emissions from these generators are vented through a single combined smokestack, and these emissions are regulated by a Title V Permit under the Clean Air Act. The permit was issued by the Alaska Department of Environmental Conservation (ADEC), under delegated authority from the U.S. Environmental Protection Agency (EPA).
Under the terms of its permit, Westward was required to install and use pollution control equipment to decrease the amount of nitrogen dioxide (NOx) being emitted from the powerhouse smokestack. To meet this requirement, Westward installed a Combustion Air Saturation System (CASS) for each generator unit, which uses water to saturate the air and reduce emissions from each generator. The permit also required Westward to operate each generator with a “dedicated fuel and water flow meter” and to record the fuel and water consumption “at a consistent time once per day.”
Beginning in 2009, and continuing until August 2011, Westward failed to operate the CASS pollution control equipment. The powerhouse supervisor, Raul Morales, discussed with the assistant chief engineer, James Hampton, that he and the powerhouse staff had stopped operating the CASS. Bryan Beigh, a powerhouse operator, assisted in falsifying data collection forms called “Engine Round” forms on a daily basis when it came to recording information about the operation of the CASS. The false information not only included indicating that the CASS was operating “OK” when it was off, but also included generating false water meter flow readings. Because the CASS was not being operated, no water was flowing through the system and therefore the actual water flow meter readings would have revealed no water use. Morales maintained a running calculation of what the flow meters should have indicated if the CASS had been properly operated, and Beigh went so far as to develop a system of removing the water flow meters to manually spin them using a drill and a magnet to make it appear that water had been flowing through the system.
In 2010, Westward entered into a civil consent decree with the United States and agreed to pay a civil penalty following prior allegations that the company had, among other things, violated emissions limits under the Clean Air Act. The consent decree, filed in United States v. Westward, 3:10-cv-00073-JWS, required Westward to reduce its NOx emissions by properly operating pollution prevention equipment.
While the EPA did not receive any reports of harm to human beings as a result of the emissions at Westward during this period of time, NOx can cause airway inflammation in otherwise healthy people and can cause or worsen symptoms of asthma, bronchitis, and other respiratory diseases.
Earlier this month, James Hampton was sentenced to just over two months in prison (70 days), and Raul Morales was sentenced to one and one-half months in prison (45 days). Both defendants were ordered to pay a $1,000 fine and serve a one-year term of supervision upon release from prison. Judge Beistline noted that both defendants knew what they were doing was against the law, but they did it anyway, and that the sentences imposed should deter others from committing similar crimes. During today’s sentencing hearing, Judge Beistline emphasized the need for every individual to have respect for the rule of law, and he told Beigh that it was not up to him to decide whether or not to follow the law. In fashioning a probationary sentence, Judge Beistline noted that Beigh had no criminal history, was remorseful and honest about his crime, and had cooperated with the United States from the beginning of the investigation.
This case was investigated by the U.S. Environmental Protection Agency Criminal Investigation Division.Palmer Man Sentenced to 50 Years Imprisonment for Sexually Exploiting ChildrenRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that a Palmer, Alaska man was sentenced in Federal Court in Anchorage on six counts of child sexual exploitation crimes. Robert Cunningham, 49, was convicted of producing child pornography, using two children under his control. Cunningham’s victimization of the children occurred between September 5, 2002 and May 8, 2003, in Palmer.
Cunningham was sentenced today by U.S. District Court Judge Sharon L. Gleason, to the maximum sentences allowable on each of the charges: 600 months (50 years) in prison on two of the convictions, and 360 months (30 years) on four of the convictions. Those sentences were to run concurrently to each other, and to Cunningham’s 88 year sentence in Alaska State Court. If Cunningham is ever released from prison, Judge Gleason ordered that he be on supervised release for the rest of his life.
According to Assistant U.S. Attorney Audrey J. Renschen, the two children were approximately eight and 12 years old when the child pornography was produced. Cunningham coerced the children by his physical presence – 6’5” tall and over 300 pounds – when he pressed the children up against the ceiling and the wall to impress upon them that they were powerless against him. He also used nitrous oxide to make them compliant with his sexual abuse. A 56 gallon tank of nitrous oxide was found in Cunningham’s home, and exhibited in court during the sentencing, along with the mask that Cunningham placed over the children’s noses and mouths.
Cunningham, who was previously convicted in Federal Court of Possession of Child Pornography in 2001, was also recently convicted in State Court for sexually abusing the children. In imposing the 50 year sentence on Cunningham, Judge Gleason commented that the most important factor she considered in imposing the sentence was the need to protect the public: if Cunningham were ever to be released from prison, children would be at risk of sexual exploitation. Judge Gleason further noted that, “There is no feasible way to protect the public at whatever age [Cunningham] might be.” Judge Gleason noted that Cunningham’s use of nitrous oxide on the children bordered on torture, and required life-long incarceration.
U.S. Attorney Loeffler stated, “The lengthy sentence in this case reflects the horrendous victimization perpetrated on innocent victims by Cunningham. Working with our law enforcement partners to protect children is a top priority and a constant mission.”
Assistant U.S. Attorney Renschen was careful throughout the sentencing to avoid using the children’s names, initials, or their relationship to Cunningham, so that the public would not try to seek out their identities, or use their victimization to cause them further pain or embarrassment. The media is thus encouraged in this press release to continue to protect the identity of the child victims who are now adults, and trying to move forward with their lives.
Ms. Loeffler commends the FBI and Alaska State Troopers for the investigation of this case.
This prosecution is part of the Department of Justice’s ongoing Project Safe Childhood (PSC) initiative which was launched to increase federal prosecutions of sexual predators of children, and to reduce the number of Internet crimes against children including child pornography trafficking. As a part of PSC, the United States Attorney’s Office has teamed with state and local agencies and organizations to increase law enforcement presence on the Internet, and to educate the public about safe Internet use, thereby reducing the risk that children might fall prey to online sexual predators. For additional information on the PSC initiative, please go to www.projectsafechildhood.gov or call the United States Attorney’s Office for the District of Alaska.Wasilla Man Sentenced to 90 Months in Prison for Heroin TraffickingRead the Press Release
Ordered to Forfeit Two Firearms and $5,000 in Cash
Anchorage, Alaska-U.S. Attorney Karen Loeffler announced today that a Wasilla man was sentenced by U.S. District Court Judge Sharon L. Gleason to serve 90 months in federal prison for his role in a heroin trafficking conspiracy.
Baretta Faatafuga, 38, of Wasilla, Alaska, previously pled guilty to conspiracy to distribute more than 1.6 kilograms of heroin throughout the Anchorage area. As part of his plea, Faatafuga admitted that in October 2013 he received an Express Mail package from California containing heroin that had been concealed inside a Sentry Safe. Faatafuga intended to distribute this heroin to others.
Upon his release from prison, Faatafuga will remain under court supervision for five years. The sentence announced today also included an enhancement based upon Faatafuga’s possession of two firearms and a loaded magazine that he had stored in his bedroom. He and his co-defendant also possessed drug packaging materials, a scale, multiple cell phones and laptop computers, as well as $5,000 in cash. Faatafuga agreed to forfeit the guns and the cash as part of his guilty plea.
In sentencing Faatafuga, Judge Gleason called the offense one of serious magnitude. She also commented on the negative impacts caused by bringing drugs into our community and noted that many families are destroyed by heroin. She indicated that Faatafuga’s sentence was designed to address the seriousness of his offense while also protecting the community from future crimes.
In announcing the sentence, U.S. Attorney Loeffler praised the U.S. Postal Inspection Service, the Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms, and Explosives, Homeland Security Investigations, and the Alaska State Troopers, who investigated the case.Federal Prisoner in Fairbanks Indicted for Soliciting the Murder of Federal OfficersRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that a Fairbanks man who is currently in federal custody at the Fairbanks Correctional Center awaiting sentencing on a number of felony charges has been indicted by a federal grand jury for soliciting the murder of federal officers. The one count indictment alleges that between September 8, 2014 and November 6, 2014, Guy Christopher Mannino, 56, of Fairbanks, solicited another person to commit the murder of multiple unnamed federal officers.
Mannino has been in custody at the Fairbanks Correctional Center since October 2013, following his indictment by a federal grand jury in August 2013, for a number of felony charges related to the unlawful possession and transfer of prohibited weapons, including a machinegun and silencers. Mannino plead guilty in March 2014, to three felony firearms charges for unlawfully possessing and transferring a machinegun equipped with a silencer, as well as an additional felony count of concealing assets from the federal bankruptcy court and creditors in a bankruptcy action which had been filed by Mannino in 2011. He has been in custody awaiting sentencing on those charges, with his sentencing presently scheduled for December 1, 2014.
Assistant U.S. Attorney Joseph Bottini, who presented the case to the grand jury, indicated that the law provides for a sentence of up to 20 years, as well as a fine of $250,000 and up to five years of supervised release following service of a prison sentence for each count. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
The Federal Bureau of Investigation, the United States Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Alaska State Troopers conducted the investigation leading to the indictment in this case.
An indictment is only a charge and is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.XS Platinum and Five Corporate Officials Indicted for Illegal Discharges from the Platinum Creek Mine and for False Statements to Federal OfficialsRead the Press Release
Anchorage, Alaska – XS Platinum, Inc. and five of its officers and employees were indicted by a federal grand jury in Anchorage today for five felony violations, including conspiracy to violate the Clean Water Act and for submitting material false statements, announced Sam Hirsch, Acting Assistant Attorney General for the Environment and Natural Resources Division of the U.S. Department of Justice, and Karen L. Loeffler, U.S. Attorney for the District of Alaska.
The indictment charges XS Platinum, Inc. (XSP), a Delaware corporation, and five of its officers and employees, Dr. Bruce Butcher, 59, and Mark Balfour, 62 (both Australian citizens), James Slade, 57 (a Canadian citizen), and Robert Pate, 62 and James Staeheli, 43 (both U.S. citizens residing in Washington state) with conspiracy to violate the Clean Water Act (CWA) during the defendants’ operation of the Platinum Creek Mine on the Salmon River in Western Alaska. In addition, the indictment charges XSP, Butcher, Balfour, Slade, and Pate with knowingly violating the terms of XSP’s CWA permit in 2010; and XSP, Butcher, Balfour, Slade, and Staeheli with knowingly violating the terms of XSP’s CWA permit in 2011. The indictment also charges XSP, Butcher, Balfour, Slade and Pate with submitting a false statement in violation of the CWA. Finally, the indictment charges XSP and Balfour with submitting a separate false statement.
According to the indictment, XSP held 159 placer mining claims and 36 hard-rock claims totaling more than 4,000 acres at the Platinum Creek Mine, which was situated along the Salmon River and its tributaries. The mine contains placer deposits of platinum metal, along with smaller amounts of gold and palladium. All but 21 of the claims were on land managed by the BLM, with the remaining (undeveloped) claims lying within the Togiak National Wildlife Refuge. The Salmon River is an anadromous fish stream that is important for the spawning of all five species of Pacific salmon (chinook, chum, coho, pink, and sockeye), and the rearing of coho and sockeye salmon. After flowing through BLM land, the Salmon River crosses the Togiak National Wildlife Refuge before entering the Pacific Ocean at Kuskokwim Bay.
The CWA prohibits discharges of industrial wastewaters from mining operations in violation of CWA permits which govern those discharges. According to the indictment, beginning in 2010 and continuing through 2011, XSP and the individual defendants knowingly discharged industrial wastewaters from XSP’s mechanical placer mining operation at the Platinum Creek Mine into the adjacent Salmon River in violation of the terms of XSP’s CWA General Permit. According to the indictment, XSP told federal regulators in its mining and CWA permit applications that the operation of the mine would recycle all of its wastewater and result in “zero discharge” of mine wastewater to the Salmon River. The indictment alleges that XSP and the individual defendants conspired to violate the CWA by concealing the 2010 and 2011 mine wastewater discharge violations from federal officials, and submitting material false statements to federal agencies. The indictment further alleges that the industrial wastewaters discharged from XSP’s operation of the Platinum Creek Mine included large amounts of sediment, turbidity, and toxic metals. It is further alleged that these discharges exceeded the CWA General Permit limits for those pollutants and that the defendants failed to report the violations as they were required. According to the indictment, XSP and its corporate officers submitted an annual report in 2011 to federal and state agencies which indicated that the mine had “zero discharge” during the 2010 mining season, when XSP’s own monitoring data showed that it had numerous discharges to the Salmon River.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
The investigation is being conducted by the U.S. Department of Interior, Bureau of Land Management, Office of Law Enforcement and Security, and the U.S. Environmental Protection Agency, Criminal Investigation Division. The case is being prosecuted by First Assistant U.S. Attorney Kevin Feldis of the U.S. Attorney’s Office for the District of Alaska, Trial Attorney Todd S. Mikolop of the U.S. Justice Department’s Environmental Crimes Section, and U.S. Environmental Protection Agency Regional Criminal Enforcement Counsel Dean Ingemanson.
Supervisors at Seafood Processing Facility Sentenced to Jail for Clean Air Act CrimeRead the Press Release
Anchorage, Alaska – U.S. Attorney Karen L. Loeffler announced today that James Hampton, 45, the former Assistant Chief Engineer for Westward Seafoods, Inc. (Westward), and Raul Morales, 53, the former Powerhouse Supervisor, were each sentenced today in U.S. District Court, in Anchorage, by Chief U.S. District Court Judge Ralph R. Beistline, to serve time in jail for falsifying data to cover up the fact that they intentionally failed to operate air pollution controls required under the Clean Air Act at the Westward seafood processing facility in Dutch Harbor.
James Hampton was sentenced to just over two months in prison (70 days), and Raul Morales was sentenced to one and one-half months in prison (45 days). Both defendants were ordered to pay a $1,000 fine and serve a one-year term of supervision upon release from prison. Judge Beistline noted that both defendants knew what they were doing was against the law, but they did it anyway, and that the sentences imposed should deter others from committing similar crimes. According to Karla Perrin, EPA Regional Criminal Enforcement Counsel, who prosecuted the case in conjunction with the United States Attorney’s Office, both defendants were allowed to return to their homes out-of-state pending being designated to a prison facility by the Bureau of Prisons.
Westward has operated a sizeable seafood processing facility in Dutch Harbor since 1999, processing approximately 250 million pounds of seafood per year. Westward is a wholly owned subsidiary of Maruha-Nichiro Holdings, Inc., a Japanese-based company, and maintains its headquarters in Seattle, Washington. The Dutch Harbor facility generates its own electricity with three diesel-fueled generators contained in its powerhouse building. Air emissions from these generators are vented through a single combined smokestack, and these emissions are regulated by a Title V Permit under the Clean Air Act. The permit was issued by the Alaska Department of Environmental Conservation (ADEC), under delegated authority from the U.S. Environmental Protection Agency (EPA).
Under the terms of its permit, Westward was required to install and use pollution control equipment to decrease the amount of nitrogen dioxide (NOx) being emitted from the powerhouse smokestack. To meet this requirement, Westward installed a Combustion Air Saturation System (CASS) for each generator unit, which uses water to saturate the air and reduce emissions from each generator. The permit also required Westward to operate each generator with a “dedicated fuel and water flow meter” and to record the fuel and water consumption “at a consistent time once per day.”
Beginning in 2009, and continuing until August 2011, Westward failed to operate the CASS pollution control equipment. Raul Morales discussed with James Hampton that he and the powerhouse staff had stopped operating the CASS. Thereafter, Hampton not only allowed this permit violation to continue, but he used his position to actively participate in a cover-up designed to make it appear that the CASS was in fact being used as required by law. Morales, along with Bryan Beigh, a powerhouse operator, falsified data collection forms called “Engine Round” forms on a daily basis when it came to recording information about the operation of the CASS. The false information not only included indicating that the CASS was operating “OK” when it was off, but also included generating false water meter flow readings. Because the CASS was not being operated, no water was flowing through the system and therefore the actual water flow meter readings would have revealed no water use. Morales maintained a running calculation of what the flow meters should have indicated if the CASS had been properly operated, and Beigh went so far as to develop a system of removing the water flow meters and manually spinning them using a drill and a magnet to make it appear that water had been flowing through the system.
The false information from the Engine Rounds was then included in the End of Day (EOD) reports and the Environmental Report Sheets (ERS) maintained by Westward. This false information was in turn reported to ADEC and EPA. On several occasions, Westward’s environmental compliance manager noticed a discrepancy and had questions about the water usage data recorded for the CASS and contacted Hampton for answers. In response, Hampton either changed the numbers or requested that Morales provide new numbers, knowing that both the previous numbers and the new numbers he provided were false. Hampton then submitted the new, but still false, water usage numbers to the environmental compliance manager.
Additionally, in April 2011, Hampton escorted an EPA inspector through the powerhouse at Westward during an inspection. Westward had advance notice of the inspection and the powerhouse supervisor and operators began operating the CASS in preparation for the inspection to make it appear that they were in fact operating the CASS routinely as required by the permit. During the inspection, Hampton guided the EPA inspector around the powerhouse and to view the daily logs which indicated that the CASS had been regularly operating, when Hampton knew that it was not being operated and the logs were false.
In 2010, Westward entered into a civil consent decree with the United States and agreed to pay a civil penalty following prior allegations that the company had, among other things, violated emissions limits under the Clean Air Act. The consent decree, filed in United States v. Westward, 3:10-cv-00073-JWS, required Westward to reduce its NOx emissions by properly operating pollution prevention equipment. Hampton and Morales were aware of the consent decree.
While the EPA did not receive any reports of harm to human beings as a result of the emissions at Westward during this period of time, NOx can cause airway inflammation in otherwise healthy people and can cause or worsen symptoms of asthma, bronchitis, and other respiratory diseases.
Bryan Beigh previously pled guilty to charges that he tampered with the meters used to monitor the operation of the CASS pollution control equipment, and he will be sentenced by Chief Judge Beistline on November 25th.
“All citizens are victims when pollution control laws are violated. Westward has been operating under a Clean Air Act permit since 2003 requiring it to reduce its NOx emissions, and it was put on further notice of the need to operate pollution control equipment when it paid penalties and entered into a consent decree in 2010,” said Karen Loeffler, U.S. Attorney. “Mr. Hampton and Mr. Morales violated the law and undermined the integrity of the self-reporting system that we all rely upon to protect human health and the environment. These two defendants were not only directly responsible for the decision not to operate the required pollution control equipment, which it appears they did largely for their own convenience, but also for the active steps they took to falsify data and cover up what they knew was wrong.”
“By failing to operate required controls, falsifying documents to cover their tracks and then misleading an EPA inspector at the facility, these defendants ‘went the extra mile’ to break the law,” said Tyler Amon, Special Agent-in-Charge of EPA Criminal Investigation Division in the Pacific Northwest and Alaska. “When they turned off the pollution controls for two years, emissions from this major pollution source increased, potentially putting workers or anyone nearby at risk for increased breathing problems.”
This case was investigated by the U.S. Environmental Protection Agency Criminal Investigation Division.Oklahoma Man Sentenced to 15 Months for EscapeRead the Press Release
Anchorage, Alaska B U.S. Attorney Karen L. Loeffler announced today that a man from Tulsa, Oklahoma, was sentenced in federal court in Anchorage for one count of Escape.
Jerome Dwight Dale, 41, was sentenced on Wednesday, November 12, 2014, by Chief U.S. District Court Judge Ralph R. Beistline. Dale received a sentence of 15 months in prison without a period of supervised release to follow.
On August 18, 2014, Dale was serving a federal sentence of imprisonment on a prior federal conviction and confined to the Cordova Center, a halfway house located in Anchorage, Alaska. Dale was in the Cordova Center to finish his federal sentence for his conviction for Escape in Georgia and then transition to living in Anchorage with family that relocated here. On August 18, Dale was not present at the Cordova Center and had not been given permission to leave. Dale was contacted by the U.S. Marshal Service on August 22, 2014, and was taken back into custody. When Dale walked away from the Cordova Center he only had 11 days left to serve on his prior sentence.
Before imposing a sentence, Judge Beistline commented that this offense was "senseless, stupid, and consistent with your prior history."
Ms. Loeffler commended the U.S. Marshal Service for the investigation leading to the successful prosecution of Mr. Dale.Guilty Verdict for Defendant Accused of Defrauding Municipality of Anchorage out of Cigarette TaxRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that Michael Butler, was convicted by a jury on charges of mail fraud, conspiracy to commit money laundering, and conspiracy to make false statements regarding the distribution of cigarettes. Michael Butler was indicted on the charges on July 18, 2013, along with Kyong Hee Kim, Sun Sims, Kimberly Sims, Jae Ho Lee, Jae Gak Lee, and Jerry Lee in a conspiracy to defraud the Municipality of Anchorage (MOA) by evading the payment of cigarette excise tax. Insook Baik, was also charged in the indictment, but was acquitted at trial. Kyong Hee Kim, Sun Sims, Kimberly Sims, Jae Ho Lee, Jae Gak Lee, and Jerry Lee previously pleaded guilty in U.S/ District Court for their roles in the conspiracy.
According to court documents, Michael Butler and Sun Sims operated and managed Up in Smoke, located in the MOA, and Golden Eagle Tobacco and Longmere Lake Grocery and Liquor, both located outside the MOA. Because they owned Golden Eagle Tobacco and Longmere Lake Grocery and Liquor, Butler and Sims could legitimately purchase MOA excise tax exempt cigarettes from tobacco wholesale distributors located in the MOA, but only if those cigarettes were actually transported outside of the MOA and offered for sale at those two stores. However, cigarettes that they purchased within the MOA and intended to sell at Up in Smoke or distribute to others within the MOA were not excise tax exempt.
Between 2009 and October 10, 2012, Michael Butler and Sun Sims used their Golden Eagle Tobacco and Longmere Lake Grocery and Liquor store accounts with tobacco wholesale distributors within the MOA to purchase excise tax exempt cigarettes that they intended to sell and distribute within the MOA. Thus, they avoided paying the MOA excise tax and increased their own profits.
The other co-conspirators paid a fee to Michael Butler and Sun Sims for the purchase of excise tax exempt cigarettes. They paid this fee for the tax exempt cigarettes in an effort to avoid paying the tax owed to the MOA. Butler and Sims would collect payment from Kyong Hee Kim and other retailers. They would then convert the money collected into cashier’s checks that appeared to be purchased by either Golden Eagle Tobacco or Longmere Lake Grocery and Liquor. Then, they used these cashier’s checks to purchase more tax exempt cigarettes, which they then delivered to the following retail stores within the MOA:
- Up in Smoke, owned and operated by Michael Butler and Sun Sims and managed by Kimberly Sims
- Mini Stop, owned and operated by Kyong Hee Kim
- Arctic/Tudor Shell and Mountain View Shell, owned and operated by Insook Baik
- Party Time Liquor, owned and operated by Jae Gak Lee
- Cheap Smokes, owned and operated by Jae Ho Lee
- Lucky Seven Foodmart, owned and operated by Jerry Lee
“Like the American tax system, taxes levied by the Municipality of Anchorage are designed to provide vital government services to our people. Tax fraud victimizes honest citizens who are paying their fair share,” said Special Agent in Charge Teri Alexander of IRS Criminal Investigation. “This verdict represents the commitment of the Department of Justice and the IRS to protect the integrity of not only our national tax system, but also that of our local communities.”
Mail fraud carries a sentence of up to 20 years imprisonment and fines up to $250,000. Conspiracy to money launder carries a sentence of up to 20 years imprisonment and fines up to $500,000. As part of their pleas and the guilty verdict of Michael Butler, the defendants also face criminal forfeitures of the proceeds of the crime.
The case was jointly prosecuted by Assistant U.S. Attorney Stephan A. Collins and Special Assistant U.S. Attorney Erin W. Bradley. The case was investigated by the Internal Revenue Service Criminal Investigation (IRS-CI), the Bureau of Alcohol Tobacco, Firearms and Explosives (ATF), and the Anchorage Police Department.Multiple Defendants Indicted in Large Scale Drug Trafficking and International Money Laundering ConspiraciesRead the Press Release
Approximately 50 Pounds of Heroin, 5 Kilograms of Cocaine,
38 Pounds of Methamphetamine & $70,000 Seized
Anchorage, Alaska-U.S. Attorney Karen L. Loeffler announced today that multiple indictments have been unsealed charging eight defendants in Texas, California, Arizona, and Alaska with conspiring to distribute large quantities of heroin, cocaine, and methamphetamine in Alaska and also working together to launder money from the United States into Mexico.
The first indictment charges two men – Omar Alejandro Alfaro and Jose Ramon Canales, of Texas, with conspiring to distribute approximately twelve kilograms of heroin and two pounds of methamphetamine that was ultimately destined for Alaska. It also charges Canales and a third individual, Genaro Gutierrez-Reyes, of California, with conspiring to transport drug proceeds from the United States to conspirators in Mexico.
The indictment outlines several separate drug transactions. According to the indictment, the first sales which occurred in person in Texas, consisted of a total of six kilograms of heroin and took place sometime prior to July 3, 2013. Conspirators later mailed three more kilograms of heroin from Texas to Alaska using Canales’s address. Investigators found these kilograms of heroin hidden in a storage unit here in Anchorage along with an additional nine kilograms of heroin and various packaging materials.
The conspirators also sold three kilograms of heroin and two pounds of methamphetamine to an Alaska undercover agent. Agents seized an additional two kilograms of heroin and two pounds of methamphetamine from conspirators during arrest operations in Texas late last week.
A second indictment charges four additional California and Arizona-based individuals – Tomas Gutierrez Ayala, Geronimo Arellano Velarde, Cristian Giovanni Lugo, and Jasmin Sanchez (who was previously known to investigators only as “Michelle”) – with conspiring to distribute large quantities of cocaine and methamphetamine to Alaska. According to the indictment, in July 2013, Ayala possessed approximately ten pounds of methamphetamine. Around the same time, an Alaska-based conspirator traveled to California to purchase a large quantity of methamphetamine.
Further, according the indictment, the conspiracy continued in October 2013, when conspirators arranged to send approximately five kilograms of cocaine and five additional pounds of methamphetamine from California to Alaska. In two subsequent transactions, conspirators sold four and
seven pounds of methamphetamine respectively to an Alaska undercover agent. In arresting the defendants, law enforcement seized an additional eight pounds of methamphetamine. Overall, the conspiracy was responsible for the distribution or attempted distribution of approximately five kilograms of cocaine and 34 pounds of methamphetamine.
The final indictment charges Timothy George Alex, 51, of Anchorage, with conspiring to distribute cocaine, heroin, and methamphetamine, as well as with one count of attempting to possess cocaine in February of this year. The indictment also seeks to forfeit approximately $70,000 in currency associated with Alex’s drug distribution activities.
Assistant United States Attorney Stephanie Courter, who presented the case to the grand jury, indicated that all of the defendants except Alex face a ten-year mandatory minimum sentence on the drug charges, up to a maximum sentence of life imprisonment. Alex faces a five-year mandatory minimum sentence, and a maximum 40 years imprisonment, for his participation. The international money laundering charge carries a maximum sentence of up to 20 years in prison. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offense and the prior criminal history of the defendant.
This case is being prosecuted by Assistant U.S. Attorney Stephanie C. Courter. The case was investigated by the Drug Enforcement Administration (DEA), the Internal Revenue Service Criminal Investigation (IRS-CI), the Federal Bureau of Investigation (FBI), the U.S. Postal Inspection Service (USPIS), U.S. Immigration and Customs Enforcement (ICE), which oversees Homeland Security Investigations (HSI), the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), the Anchorage Police Department (APD), the Alaska State Troopers (AST), and the Anchorage Airport Police Department. Additional assistance was provided by the U.S. Attorney’s Offices for the Western District of Texas, the Eastern and Central Districts of California, and the District of Arizona, as well as federal agents in all three states.
An indictment is only a charge and is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the United States must prove guilt beyond a reasonable doubt.Anchorage Man Sentenced for Conspiracy to Distribute MethamphetamineRead the Press Release
Anchorage, Alaska – U.S. Attorney Karen L. Loeffler announced today that an Anchorage man was sentenced in federal court in Anchorage for the crimes of drug trafficking conspiracy and possession of a controlled substance with intent to distribute.
David Alan Gonzales, 55, originally from Santa Ana, California, was sentenced by United States District Court Judge Sharon L. Gleason, to 120 months’ imprisonment.
According to Special Assistant U.S. Attorney Erin Bradley, Gonzales conspired to distribute, and possess with intent to distribute, methamphetamine. This case arose when the United States Postal Inspection Service identified a suspicious package at their processing center on March 26, 2013. The package, which contained 52 grams of actual methamphetamine, had been sent to Anchorage from Anaheim, California. Gonzales and his co-defendant, Albert Diaz Gumataotao, accepted delivery of the package on March 28, 2013. Though Gonzales was residing in Anchorage at the time of this offense, he has significant ties to the State of California, where he has lived most of his life. Gonzales was convicted by a federal jury in July of this year. Gumataotao pled guilty on November 6, 2013, to one count of drug trafficking conspiracy and was also sentenced to 120 months’ imprisonment.
In imposing the sentence, Judge Gleason noted a need to promote respect for the law, as well as a need to deter the defendant and others from committing similar crimes. Judge Gleason also focused on protecting the public and avoiding disparity in sentences.
Ms. Loeffler commends the United States Postal Inspection Service and the Anchorage Police Department for the investigation leading to the successful prosecution of Gonzales and Gumataotao. Special Assistant U.S. Attorney Bradley is a prosecutor in the U.S. Attorney’s Office who is funded by the Municipality of Anchorage for the purpose of prosecuting gang-related and violent crime cases.
Fairbanks Man Indicted for Child Exploitation CrimesRead the Press Release
Anchorage, Alaska – United States Attorney Karen L. Loeffler announced today that a federal grand jury returned a two-count indictment against Clint Michael Landry, 57, of Fairbanks, Alaska, charging him with attempted production of child pornography, and attempted coercion and enticement of a minor.
According to court documents, between May 18, 2014, and May 19, 2014, Landry attempted to coerce a minor into engaging in sexually explicit conduct for the purpose of producing a visual depiction of that conduct.
The case was the product of an investigation by the Federal Bureau of Investigation. Assistant United States Attorney Kyle Reardon is prosecuting the case.
If convicted of attempted production of child pornography, Landry faces a maximum statutory penalty of not less than 15 and up to 30 years imprisonment. If convicted of attempted coercion and enticement, Landry faces a maximum statutory penalty of not less than 10 years and up to life. Both counts carry fines of up to $250,000, as well as the possibility of a lifetime period of supervised release following any sentence of imprisonment. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
This prosecution is part of the Department of Justice’s ongoing Project Safe Childhood (PSC) initiative which was launched to increase federal prosecutions of sexual predators of children, and to reduce the number of Internet crimes against children including child pornography trafficking. As a part of PSC, the United States Attorney’s Office has teamed with state and local agencies and organizations to increase law enforcement presence on the Internet, and to educate the public about safe Internet use, thereby reducing the risk that children might fall prey to online sexual predators. For additional information on the PSC initiative, please go to www.projectsafechildhood.gov or call the United States Attorney’s Office for the District of Alaska.