Northern District of Alabama
Press releases recorded for this federal judicial district.
Lee County Man Sentenced to More Than Eight Years in Prison for Five North Alabama RobberiesRead the Press Release
BIRMINGHAM -- A federal judge today sentenced a Lee County man to eight years and four months in prison for a 2013 string of bank robberies in North Alabama, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.JIMMY DAWSON CUNNINGHAM JR., 39, of Salem, Ala., pleaded guilty in January to five bank robberies between Jan. 3, 2013, and Jan. 14, 2013. The banks robbed over those 12 days were: National Bank of Commerce, Shades Creek Parkway, Birmingham; PNC Bank, Euclid Avenue, Mountain Brook; First Community Bank, Marktplatz Center, Cullman; Regions Bank, Culver Road, Mountain Brook; and Union State Bank, Pelham Parkway, Pelham.
U.S. District Judge Inge P. Johnson sentenced Cunningham to prison and ordered him to pay $14,780 in restitution to the four banks that lost money in his robberies. Cunningham took money in all five robberies, but the money he robbed from First Community Bank in Cullman was recovered following the crime.
The FBI, in conjunction with the Jefferson County Sheriff's Office and the Mountain Brook, Cullman and Pelham police departments, investigated the case, which Assistant U.S. Attorney Joseph P. Montminy prosecuted.
Talladega Scrap Yard Owner Forfeits $1.3 Million for Financial StructuringRead the Press Release
BIRMINGHAM -- A Talladega scrap yard owner pleaded guilty today to structuring $119,400 in cash transactions, announced U.S. Attorney Joyce White Vance and IRS Criminal Investigation Division Special Agent in Charge Veronica Hyman-Pillot.
EDWARD M. HINDMAN, 61, owner of Hindman's Wrecker Service & Salvage in Talladega, entered his guilty plea to one count of structuring before U.S. District Judge L. Scott Coogler. Hindman must forfeit $119,400 to the government as part of his plea agreement. He is scheduled for sentencing June 26.
Hindman also agreed to civilly forfeit $1,148,981 in a civil forfeiture action brought by the United States against money seized from Hindman's bank account in March 2011. In a Stipulation of Settlement filed today in the civil case, Hindman admitted no wrongdoing, but acknowledged that the government had reasonable cause to seize the money in 2011 and commence the forfeiture proceedings.
The U.S. Attorney's Office brought the criminal charge against Hindman in an information filed Thursday in U.S. District Court. His plea agreement with the government also was filed Thursday. Hindman acknowledges in the plea agreement that he intentionally structured, and directed others to structure, cash withdrawals at First National Bank Talladega in amounts less than $10,000 to avoid triggering the bank's requirement to file a Currency Transaction Report with the U.S. Treasury Department on all transactions greater than $10,000.
Between Feb. 23, 2011, and March 5, 2011, Hindman wrote, or directed others to write, 16 checks payable to "cash," which were cashed at the Talladega bank, according to his plea agreement. All the checks were just below the reporting requirement amount and totaled $119,400. The cash withdrawals were used to fund the operation of Hindman's salvage yard, according to his plea.
The Internal Revenue Service, Criminal Investigation Division, investigated the case. Assistant U.S. Attorney Amanda Wick is prosecuting the case and Assistant U.S. Attorney Jennifer Murnahan represents the government in the civil case.
Trussville Man Sentenced to Two Years in Prison for Multi-Million Dollar Tax SchemeRead the Press Release
BIRMINGHAM – A federal judge today sentenced a Trussville man to two years in prison for a scheme to collect millions of dollars from the Internal Revenue Service on false tax returns, announced U.S. Attorney Joyce White Vance and IRS Criminal Investigation Division Special Agent in Charge Veronica Hyman-Pillot.
U.S. District Judge L. Scott Coogler sentenced NORMAN JAMES SECOR, 67, on four counts of making false claims against the government by filing or aiding in the filing of false income tax returns and supporting documents between June 2008 and February 2009. Judge Coogler also ordered Secor to pay the IRS $204,172 in restitution, which was part of Secor's November plea agreement with the government. Secor must report to prison April 28, and serve three years of supervised release after completing his prison term.
"The Internal Revenue Service will pursue all individuals who participate in schemes designed to undermine the integrity of the U.S. tax system,” Hyman-Pillot said. "As an agency, we are dedicated to maintaining the public’s confidence in our efforts to enforce the tax laws. As a result, today’s sentence of Norman Secor should serve as a reminder that individuals will face consequences for committing tax violations and defrauding the government.”
Secor was indicted last year on charges that he filed, or helped others file, 12 false tax returns claiming $5.2 million in refunds. Each false tax return contained a claim that interest income had been earned during the tax year on a certain type of bond, and that the taxpayer was entitled to a refund of federal income taxes withheld on those earnings. No such earnings or withholdings actually had occurred.
IRS, Criminal Investigation, investigated the case, which Assistant U.S. Attorneys George Martin and Robin Beardsley Mark prosecuted.
Mobile Man Sentenced to Nearly Four Years in Prison for Conning $260,000 from Three WomenRead the Press Release
BIRMINGHAM -- A federal judge today sentenced a Mobile man to nearly four years in prison in connection with a con scheme totaling more than $260,000 that he ran on at least three women he met in an upscale Birmingham steakhouse, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.
JULIAN PEARSON BURKE, 56, pleaded guilty in October to two counts of wire fraud and one count of interstate transportation of stolen goods. U.S. District Judge L. Scott Coogler sentenced Burke to 45 months in prison on the charges and ordered him to pay the victims $264,300 in restitution. Burke had agreed to the restitution as part of his plea agreement with the government. Judge Coogler ordered Burke into custody immediately following today's hearing.
Between October 2010 and October 2011, Burke struck up friendships with at least three women he met at a restaurant in the Summit Shopping Center on U.S. 280. He convinced all three to give him tens of thousands of dollars for him to invest, according to court documents. Instead of investing the money, Burke spent it at pawnshops and casinos. He never returned any money to the three women.
Burke pleaded guilty to transporting stolen goods across state lines for receiving a $100,000 investment check from a woman, identified by the initials C.W., and converting it to personal use by endorsing and negotiating the check at the Imperial Palace of Mississippi casino in Biloxi. The woman believed she was investing in the Admiral Semmes Hotel in Mobile.
According to Burke's plea agreement and other court documents, he carried out his wire fraud scheme as follows:
Burke owned two businesses, Burke Construction and Computer Converters, and maintained business accounts for both at the Mississippi-based Hancock Bank.
In October 2010, Burke met a woman, identified by the initials D.G., at the Birmingham restaurant and built a friendship. In February 2011, he asked D.G. to invest with him by loaning money to pawnshops. On Feb. 7, 2011, she wired $18,000 from her bank account to the Computer Converters account, which held $313 before her deposit. The next day, Burke transferred $18,200 from the Computer Converters account to the Burke Construction account. The same day, he wrote two $9,150 checks to Quik Pawn in Mobile to buy back a 17-carat platinum watch and a men's diamond pinky ring he previously had pawned there for $7,500 each.
In April 2011, Burke convinced D.G. to invest $86,000 more with him, claiming he was publishing academic coloring books for children and would roll her previous investment, plus interest, into the project. She thought she would get back the $110,000, plus interest, within six months. In July 2011, D.G. wired another $20,300 to the Burke Construction account for the coloring book project. Burke never returned any of D.G.'s money. He also cashed a $59,921 check at Grand Casino of Mississippi on the same day the $86,000 was deposited into the previously overdrawn construction company account.
The third victim in the case is identified in court documents by the initials, S.H. Burke met her at the Birmingham restaurant in February 2011. He convinced S.H. to invest with him in buying a pawnshop, with the understanding that she would earn 15 percent interest within 60 days. On Oct. 24, 2011, S.H. wired $40,000 to the Burke Construction bank account, which was overdrawn until the deposit arrived. That same day, Burke withdrew $35,000 cash and transferred $2,000 to the Computer Converters account.
The FBI investigated the case, which Assistant U.S. Attorney Robin Beardsley Mark prosecuted.
Former JCCEO Executive Director Sentenced to Two Years in Prison for Stealing from Non-profit Community AgencyRead the Press Release
BIRMINGHAM – U.S. District Judge L. Scott Coogler today sentenced the former executive director of the Jefferson County Committee for Economic Opportunity to two years in prison for stealing close to $500,000 from the non-profit organization, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.
RUTH GAYLE CUNNINGHAM, 64, was executive director of JCCEO for more than 20 years before resigning the job last March. She pleaded guilty in September to theft from a government program that received more than $10,000 in federal funding or assistance. Her daughter, Kelli E. Caulfield, 31, pleaded guilty last year to conspiring with her mother to defraud JCCEO. Cunningham paid $492,195 in restitution to JCCEO, which was part of her plea agreement with the government, before today's sentencing. She must report to prison April 28.
JCCEO is a community action agency that administers programs, including Head Start, for low-income and disadvantaged residents. Between late 2008 and April 2010, while Cunningham and her daughter were running fake invoices through the agency and using agency funds to pay mortgages on personal investment properties, JCCEO was paying Cunningham a salary of as much as $150,000, plus bonuses, benefits and retirement contributions.
"At the same time Cunningham was being showered with accolades, benefits, and praise for her work at the JCCEO, she was stealing funds which could have been used for community programs," the government said in its sentencing memorandum.
"Gayle Cunningham was able to steal money intended to help some of the most vulnerable members of our community because she traded on her long tenure at JCCEO to receive broad discretionary powers from its board," Vance said. "She and her daughter exploited that authority to steal nearly a half million dollars from the agency. As a result, training programs lagged, Head Start buses were not replaced, and classroom computers were running on obsolete, unsupported operating systems," she said. "Prison is deserved for this type of abuse of trust and misuse of federal funds."
"Today's sentence should send the message that regardless of who you are or the position that you hold, you cannot abuse the public trust and steal federal funds," Schwein said. "The public can expect that the FBI will continue to aggressively investigate public corruption at all levels."
According to court records, Cunningham used JCCEO funds in 2009 and 2010 to make monthly mortgage payments on at least three residential properties she owned, and at least five residential properties her daughter owned, in Jefferson and Shelby counties. Cunningham also used JCCEO funds to pay property taxes on one of those properties, a house in Chelsea that she bought in 2007 with a mortgage loan of more than $1 million.
Cunningham also paid $293,413 in JCCEO funds to companies her daughter owned, and to other contractors, for claimed repairs or renovations to the women's properties. Caulfield created the invoices for repair services that never were performed, and she disguised her ownership in many of the companies, according to the government's sentencing memorandum. The checks were drawn from the JCCEO operating account and allocated to the agency's Housing Revitalization Program.
Caulfield crafted the invoices for amounts less than $5,000 to prevent the need for a second signature by a member of the JCCEO board. As executive director, her mother had check-signing authority up to $5,000.
The FBI discovered the fraud at JCCEO while investigating allegations of a mortgage fraud scheme. That investigation led to federal prosecutors' charges against Cunningham and Caulfield, as well as to charges against a real estate investor and a mortgage broker of conspiracy to defraud federally insured financial institutions. Cunningham and Caulfield bought most of the properties that later became part of their scheme to defraud JCCEO from the investor, Robert Paul Hollman.
Hollman pleaded guilty in September and is scheduled for sentencing April 2.
The government's sentencing memorandum argues that Cunningham and Caulfield have "improperly characterized themselves as victims in the real estate transactions with Hollman." Cunningham has a history of buying real estate and, on all the purchases from Hollman, the loan applications and mortgage documents show Cunningham and her daughter signed and willingly entered the contracts, the memo states.
It also challenges a claim in Cunningham's own sentencing memorandum that, during meetings she had with JCCEO Board Chairman T.L. Lewis, it was suggested she use the agency's Housing Revitalization Program funds to pay her personal mortgages.
Lewis told investigating agents that Cunningham and Caulfield never were authorized to use JCCEO money to pay personal mortgages.
"Cunningham's statement that she had approval from the chairman of the board is a completely self-serving statement that is unsupported by the evidence," the government memorandum states. "These attempts by Cunningham to legitimize her actions and mitigate the need for a custodial sentence by pointing the finger at Dr. Lewis are contrary to the facts and evidence and furthermore are contrary to her acceptance of responsibility," it states.
The FBI investigated the case. Assistant U.S. Attorney Robin Beardsley Mark is prosecuting the case.Federal Grand Jury Indicts Man Who Flew into Birmingham Airport and Attempted to Fly Out Under Assumed NamesRead the Press Release
BIRMINGHAM -- A man who flew into the Birmingham-Shuttlesworth International Airport under an assumed name on March 16 now faces a federal grand jury indictment for violating airport security and presenting false identification documents, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.
The three-count indictment filed in U.S. District Court charges ROBERT ANTHONY RICKS, 30, with the felonies of entering an airport area in violation of security requirements, and with using someone else's identification to illegally enter an aircraft or secure airport area. The indictment also charges Ricks with entering a secure airport area by false pretenses, a misdemeanor.
Ricks was arrested at the airport and initially charged in a federal complaint under the name Robert Quran Hick. His indictment lists that name, along with four others, as aliases. The other aliases included are Robert Harris, Quran Kendrick, Sage Malik and Wise. The investigation is ongoing and Ricks' last place of residence has not been confirmed.
Count 1 of the indictment charges that Ricks got off Delta Flight 1535 in Birmingham and entered the "secure and sterile area of the terminal" under the identity of "U.W." Thereafter, he assumed the identity of another person, identified in the indictment by the initials, M.M. A March 17 FBI affidavit supporting Ricks' arrest complaint identifies Flight 1535 as flying to Birmingham from Atlanta.
Count 2 of the indictment, the misdemeanor, charges that Ricks attempted to go through security screening at the Birmingham airport using a boarding pass in the name of M.M.
Count 3 charges that Ricks illegally possessed a document identifying him as M.M. and intended to use the document to enter an aircraft or a secure airport area.
According to the arrest affidavit, Ricks obtained United Airlines boarding passes from Birmingham to Chicago, and from Chicago to Colorado Springs by telling a United representative in Birmingham that he was M.M. Ricks made the claim at a United boarding gate after hearing a public address system message for M.M.
Hicks was arrested after he left the secure area of the Birmingham airport, twice tried to re-enter the area by going up the down escalator, and then tried to go through a Transportation Security Agency checkpoint using one of the United boarding passes, according to the arrest affidavit.
The affidavit also reports that Ricks provided a false name and birth date to the FBI agent who interviewed him when he was arrested.
The maximum penalty for entering an airport area in violation of security requirements is 10 years in prison and a $250,000 fine; and the maximum penalty for possessing false identification documents with the intent to use them illegally is five years in prison and a $250,000 fine. The misdemeanor charge of entering a secure airport area by false pretenses carries a maximum sentence of six months in prison and a $5,000 fine.
The FBI investigated the case, which Assistant U.S. Attorney Elizabeth Holt is prosecuting.
The public is reminded that an indictment contains only charges. A defendant is presumed innocent and it is the government's responsibility to prove guilt beyond a reasonable doubt.
Endoscopy Center Agrees to Ensure Necessary Aid to Visually Impaired PatientsRead the Press Release
BIRMINGHAM -- The Alabama Digestive Health and Endoscopy Center, a joint venture operating in leased space on the Brookwood Medical Center campus, has agreed to take action to ensure that patients who are blind or visually impaired receive necessary aids or services to enable them to communicate effectively with doctors and staff, announced U.S. Attorney Joyce White Vance.
ADHEC and Brookwood Medical Center each have entered a settlement agreement with the U.S. Department of Justice. A key provision of the settlement is a commitment to provide qualified readers, taped texts, audio recordings, Brailed materials, large-print materials or signature guides to patients -- or a family member, friend or associate assisting in a patient's care -- who are blind or visually impaired.
The Justice Department initiated negotiations after a visually impaired woman filed a complaint against ADHEC in April 2013 under the Americans with Disabilities Act. The woman claimed that staff at ADHEC failed to provide auxiliary aid to ensure effective communication with her. Rather than reading her the medical and legal documents for her to sign, the woman claimed the endoscopy center staff gave the documents to her husband for his signature.
ADHEC and Brookwood Medical Center dispute the woman's allegations and deny the endoscopy center failed to comply with Title III of the ADA, which prohibits public accommodations from discriminating against someone on the basis of disability in gaining full and equal access to its goods, services, facilities and privileges. The act also requires public accommodations to provide auxiliary aids and services if needed to ensure effective communication.
ADHEC and Brookwood Medical Center cooperated with the government's investigation and acknowledged their legal obligation, as well as their shared interest in providing blind and visually impaired individuals with the assistance necessary to communicate fully with staff, caregivers and doctors.
Other provisions of the settlement include:
• That the determination of whether, and which, aids a blind or visually impaired patient may need must be made at the time an appointment is scheduled or on the patient's arrival. ADHEC and Brookwood each will assess a patient's communication abilities and needs as part of each initial patient assessment.
• That all patients and companions who may need additional communication aids or services will be notified of the services available to them, regardless of whether the patient or companion has requested assistance.
• If the endoscopy center or the medical center staff believe that providing additional communications aids or services might assist in providing medical services to a patient, but neither the patient nor the patient's companion has requested assistance, each will inform the patient or companion that such assistance is available and free.
• Provide mandatory ADA training, annually, to physicians, employees and staff who might interact with patients or their companions on how to identify the communication needs of visually impaired patients and patient companions. The training also will include the types of auxiliary aids and services available and the notification procedures for alerting staff and physicians when patients and companions who might need those services schedule appointments, tests, therapies or other health care services.
• The agreement and the obligations are for a term of two years.
Assistant U.S. Attorney Carolyn W. Steverson represented the government in this matter.Birmingham Man Sentenced to Five Years in Prison for Manufacturing and Selling Synthetic MarijuanaRead the Press Release
BIRMINGHAM -- A federal judge today sentenced a Birmingham man to five years and three months in prison for manufacturing synthetic marijuana and distributing it across the country from his apartment in Birmingham's Southside community, announced U.S. Attorney Joyce White Vance and U.S. Postal Inspector Frank Dyer.
U.S. District Judge Abdul K. Kallon sentenced ROBERT JAMES PRESSLER, 28, one count of conspiracy to manufacture with intent to distribute the controlled chemical substance XLR11, or "Spice." Pressler pleaded guilty to the charge in December. Judge Kallon ordered Pressler to forfeit $238,428 to the government as proceeds of illegal activity. Pressler must report to prison May 16.
Pressler used his apartment as a laboratory for mixing dried plants and herbs with the XLR11, and used the U.S. Postal Service to ship the synthetic marijuana across the country - cash on delivery, according to court records. He used websites, including "bobsbud" and "bobswackytobacky," to take orders for the substance and conducted the transactions under the business name, Ninja Foot LLC, which had a Birmingham post office box.
Although Pressler's websites noted that the product was not for human consumption, the government introduced e-mails during Wednesday's hearing that showed he knowingly sold the Spice for smoking as synthetic marijuana.
On the websites, Pressler presented the synthetic marijuana as "herbal incense" and also advertised and sold 5FUR144 -- the XLR11 controlled substance -- in bulk as a "research chemical," according to his plea agreement with the government. Prices for 5FUR144 were listed on one site in a range from $50 for five grams to more than $5,000 per kilogram.
Among mail Pressler received at his apartment in 2012 and 2013 were several large packages from China with shipping labels indicating they contained various chemicals, and some listed weights of at least three kilograms, or nearly seven pounds, according to his plea agreement. The agreement also noted that China is a known source for purchase of chemicals used in the production of synthetic marijuana.
Postal inspectors found COD records for Pressler and Ninja Foot between December 2012 and June 2013 that totaled more than $100,000, according to court records.
A second Birmingham man, Seth Alexander Batten, 30, also pleaded guilty in December to the conspiracy to manufacture and distribute XLR11. Batten worked with Pressler to manufacture and ship synthetic marijuana, according to Pressler's plea agreement. Batten is scheduled for sentencing April 23.
The U.S. Postal Inspection Service, along with the Alabama Alcohol Beverage Control Board's state narcotics team, and the Birmingham Police Department, investigated the case, which Assistant U.S. Attorney John B. Felton is prosecuting.
Former Childersburg City Councilwoman Sentenced to Three Years in Prison for Bank Fraud and Money LaunderingRead the Press Release
BIRMINGHAM -- A federal judge today sentenced a former Childersburg City Councilwoman to nearly three years in prison for bank fraud and laundering nearly $1 million from SouthFirst Bank, announced U.S. Attorney Joyce White Vance, U.S. Secret Service Special Agent in Charge Craig Caldwell, and IRS Criminal Investigation Special Agent in Charge Veronica Hyman-Pillot.
U.S. District Judge Inge P. Johnson sentenced BONNY JEAN CARTER, 61, to two years and nine months in prison and ordered her to repay $37,200 to SouthFirst Bank, and $949,287 to its insurance company, Zurich Financial and Security. Carter pleaded guilty in December to one count each of bank fraud and money laundering. She is to report to prison May 13.
"This defendant used her position of trust with the bank she worked for to steal nearly $1 million from the bank over 10 years," Vance said. "Stealing from a financial institution will not go unpunished, and the prison sentence Ms. Carter received today is justice finally being served."
"IRS Criminal Investigation, along with our law enforcement partners, will vigorously pursue corporate officers who violate the public trust," Hyman-Pillot said. "We are committed to investigating complex financial transactions and money laundering schemes where individuals attempt to conceal the true source of their money. This sentence should serve as a deterrent to those who might contemplate similar fraudulent actions."
Carter had worked as an account clerk at the Sylacauga branch of SouthFirst Bank. In that position, between June 2004 and March 2013, she embezzled from the bank by converting money to personal savings accounts. Carter recorded journal entries to transfer money from various SouthFirst Bank general ledger accounts into personal accounts held in her daughter's name. She also skimmed amounts from checks made payable to SouthFirst Bank by depositing the funds into those personal accounts. Additionally, Carter issued debit transactions from SouthFirst Bank’s operating expense account to pay personal debts she owed.
The U.S. Secret Service and Internal Revenue Service investigated the case, which Assistant U.S. Attorney Robin Beardsley Mark prosecuted.
Birmingham Man Convicted of Cocaine TraffickingRead the Press Release
BIRMINGHAM -- A federal jury late Tuesday convicted a Birmingham man of possession with the intent to distribute a half kilogram of cocaine, announced U.S. Attorney Joyce White Vance and Drug Enforcement Administration Assistant Special Agent in Charge Clay A. Morris.
Following a two-day trial before U.S. District Judge L. Scott Coogler, the jury convicted BINIAM ASGHEDOM, 40, an Eritrean national, of possessing and intending to distribute about a pound of cocaine. Asghedom is scheduled for sentencing June 25.
According to evidence at trial, Birmingham police stopped Asghedom for a traffic violation on Dec. 1, 2010, after federal agents had followed him from a known drug location. Asghedom was one of a number of targets of a larger DEA investigation. After obtaining Asghedom’s consent, officers searched the 2000 GMC Sierra pick-up truck he was driving and found the cocaine and $14,500. Forensic testing later revealed that the outside packaging of the cocaine had two latent fingerprints that matched Asghedom.
“Asghedom’s conviction marks another success in law enforcement’s concerted efforts to eliminate the dangerous street drugs that devastate neighborhoods and fuel violent crime." Vance said.The DEA investigated the case, which Assistant U.S. Attorney Gregory R. Dimler prosecuted.
Hospice Operator Agrees to Pay $3.92 Million to Settle False Claims LawsuitRead the Press Release
BIRMINGHAM, Ala. – The parent company of Hospice Compassus, which previously operated in Alabama, has agreed to pay the United States $3.92 million to settle allegations that the company submitted false claims to the government for patients treated at its hospice facilities, announced Northern District of Alabama U.S. Attorney Joyce White Vance and Health and Human Services, Office of Inspector General, Special Agent in Charge Derrick L. Jackson.The settlement agreement between the government and CLP HealthcareServices, a Delaware corporation based in Brentwood, Tenn., recently was filed in U.S. District Court.
Hospices provide palliative care – any form of medical care or treatment that concentrates on reducing the severity of disease symptoms – to patients who decide to forego curative care of their illness. Medicare beneficiaries are entitled to hospice care if they have a prognosis of six months or less to live. The government alleged that Hospice Compassus was submitting false claims for hospice care for patients who were not eligible for such care.
“This settlement returns to taxpayers almost $4 million that was wrongfully claimed from Medicare by a company that offered hospice care in Alabama,” Vance said. “The U.S. Attorney’s Office in North Alabama is committed to protecting public monies and safeguarding Medicare beneficiaries.”
“The OIG is committed to identifying improper billing to Medicare and returning those dollars back to the taxpayers," Jackson said.
The settlement results from two qui tam, or "whistle blower," lawsuits filed by two former Hospice Compassus employees. The False Claims Act authorizes private parties to file suit against those who defraud the United States and to receive a share of any recovery. The United States will pay approximately $712,000 to the individuals who filed the actions against Hospice Compassus.
The U.S. Attorney’s Office for the Northern District of Alabama and the Department of Health and Human Services, Office of the Inspector General, investigated the case.
Former State Inmate Gets 5 ½ Years in Federal Prison for Leading IRS Tax Fraud from Inside State PrisonRead the Press Release
BIRMINGHAM – A federal judge today sentenced the ringleader of a federal tax fraud that was run from inside an Alabama state prison to serve more than five years in federal prison, announced U.S. Attorney Joyce White Vance, Internal Revenue Service Criminal Investigation Division Special Agent in Charge Veronica Hyman-Pillot, and FBI Special Agent in Charge Richard D. Schwein Jr.
SHERMAINE “Shade” GERMAN, 57, now paroled from state prison, was an inmate at Donaldson Correctional Facility in Bessemer when he orchestrated the far-reaching tax scheme that included taking identifying information of fellow inmates and using the information to create false income tax returns. The scheme, which German led for about five years, cost U.S. taxpayers more than $788,000. German pleaded guilty to the conspiracy in December.
U.S. District Judge Virginia Emerson Hopkins sentenced German to five years and six months in prison and ordered him to pay $788,280 in restitution to the government as proceeds of illegal activity. He is in federal custody. Along with German, six people from four cities across Alabama have pleaded guilty to the tax conspiracy. German and his co-defendants are jointly responsible for the restitution."This defendant took the identities of at least 70 fellow inmates and, from inside his cell, directed a complicated fraud that involved the submission of more than 2000 tax returns, the mailing of more than 500 false tax refund checks and a loss of hundreds of thousands of dollars to the U.S. Treasury," Vance said. "Today's sentence is proof that, with our law enforcement partners, we will track identity and tax fraud wherever we find it and prosecute those responsible."
"IRS Criminal Investigation has made investigating refund fraud and identity theft a top priority," said Hyman-Pillot of the IRS Atlanta Field Office. "Filing fraudulent tax returns in the names of other individuals often results in significant harm to those individuals whose identities were stolen, as well as a monetary loss against the U.S. Treasury," she said. "As we continue working through tax season, this conviction should send a message that the IRS will aggressively pursue all individuals who attempt to defraud the U.S. tax system.”
“The sentence imposed today speaks to the outstanding efforts of the FBI, IRS, and the United States Attorney’s Office who uncovered, investigated, and prosecuted German and all his co-conspirators who participated in these schemes,” Schwein said.
According to the indictment and other court documents, German and his co-defendants conspired to obtain payment of false claims for refunds from the IRS as follows:
From January 2008 to May 2013, while German was an inmate at Donaldson, he obtained the names, birth dates and Social Security numbers of other people, often fellow inmates, including prisoners on death row and those serving sentences of life without parole. He used their information to create false income tax returns that contained fabricated amounts of tax withholdings.
German also created false power of attorney forms, which he mailed out of the prison along with the false income tax returns. Various other members of the conspiracy notarized the power of attorney forms and used them to cash or deposit income tax refund checks received as part of the scheme.
The co-defendants who have pled guilty to conspiring with German in the fraud are: RONALD WEBSTER, 56, and YVETTE BERRY PINCKNEY, 49, both of Montgomery; MARLO YVETTE MILLER, 46, and IRENE KING DOUGLAS, 59, both of Huntsville; CYNTHIA DIANNE WARE, 50, of Eufaula; and BARBARA ANN GRIMES, 63, of Mobile.
Judge Hopkins also sentenced Ware today, ordering her to serve six months in home detention as a condition of the five years' probation the court imposed. Judge Hopkins also ordered Ware to pay the government $54,605 in restitution.
Miller, Pinckney, Douglas and Webster are scheduled for sentencing April 1 in Huntsville. Grimes is scheduled for sentencing April 8 in Birmingham.
The IRS and FBI investigated the case, which Assistant U.S. Attorney Russell E. Penfield is prosecuting.
American Family Care Inc. to Pay $1.2 Million to Settle Allegations of Inflated Medicare ClaimsRead the Press Release
WASHINGTON - American Family Care Inc. has agreed to pay the government $1.2 million to resolve allegations under the False Claims Act that it knowingly submitted claims to Medicare for outpatient office visits that were billed at a higher rate than was appropriate, the Justice Department announced today. American Family Care is a network of walk-in medical clinics headquartered in Birmingham, Ala., with offices in Alabama, Tennessee and Georgia.
“Mischarging the government for office visits wastes valuable government resources that could be used to care for other patient needs,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery. “At a time of increasing concern about the cost of medical care, it is especially important to ensure that health care providers are not overbilling the government by improperly inflating their claims.”
Following guidance adopted by the Centers for Medicare and Medicaid Services, health clinics such as American Family Care bill Medicare for their services by selecting a corresponding Evaluation and Management code. The codes are divided into five different levels - from basic (level 1) to most complex (level 5). Higher level codes result in higher reimbursement from Medicare than lower level codes. The government alleged that American Family Care knowingly selected Evaluation and Management codes for a level of services that exceeded those actually provided in order to artificially increase the amount of reimbursement it received for those visits.
“The False Claims Act is a critical tool for weeding out fraud and protecting the taxpayers,” said U.S. Attorney for the Northern District of Alabama Joyce White Vance. “My office will continue to return funds, like the $1.2 million in this case, to the taxpayers by proceeding against those who abuse our public health programs."
“Billing the government for services not provided as claimed cheats both taxpayers and patients,” said Derrick L. Jackson, Special Agent in Charge of the Office of Inspector General, U.S. Department of Health and Human Services region including Alabama. “We will pursue aggressively providers like American Family Care alleged to have improperly maximized reimbursements.”
The civil settlement resolves a lawsuit filed by Anita C. Salters, a former employee of American Family Care, under the whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the government for false claims and to obtain a portion of the government’s recovery. Salters’ share has not yet been determined.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder and Secretary of Health and Human Services Kathleen Sebelius. The partnership between the two departments has focused on efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $19 billion through False Claims Act cases, with more than $13.4 billion of that amount recovered in cases involving fraud against federal health care programs.
This settlement with American Family Care was the result of a coordinated effort among the U.S. Attorney’s Office for the Northern District of Alabama; the Department of Justice’s Civil Division, Commercial Litigation Branch; the Office of Inspector General of the U.S. Department of Health and Human Services and the Federal Bureau of Investigation.
The lawsuit is captioned United States ex rel. Anita C. Salters v. American Family Care Inc. (N.D. Ala.). The claims resolved by this settlement are allegations only, and there has been no determination of liability.
Clay County Jail Administrator Pleads Guilty to Violating Inmates' Civil RightsRead the Press Release
BIRMINGHAM -- The former jail administrator of the Clay County Detention Center pleaded guilty Wednesday to violating the civil rights of inmates by using his authority to sexually abuse or otherwise deprive the inmates of their constitutional rights, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.
JEFFREY SCOTT COTNEY, 48, of Ashland, entered his plea before U.S. District Judge L. Scott Coogler to four counts of deprivation of rights under color of law between May 2009 and spring 2010 while he worked as Clay County's jail administrator. As part of that job, Cotney ran the inmate worker program, recommending which inmates could participate in the program and supervising the inmate workers.
A federal grand jury indicted Cotney in November. His sentencing is scheduled May 27.
As part of Cotney's plea agreement with the government, he must register as a sex offender, surrender all current law enforcement licenses and certifications and neither seek nor hold a law enforcement job or one where he would have custodial authority over others, including as a correctional or probation officer or bail bondsman.
Cotney pleaded guilty to four counts involving three inmates, but the conduct he admitted to in his plea agreement also includes a fourth inmate.
In his plea, Cotney admitted to coercing one inmate to submit to a sexual act on four occasions in 2009, three times at Cotney's home and once on the side of the road during a trip to Oxford to get automobile parts.
Cotney admitted to violating the civil rights of a second inmate in 2009, forcing that inmate to submit to a strip search with no law enforcement justification.
Cotney admitted to repeatedly and improperly grabbing and touching a third inmate in 2009 and 2010, including telling the inmate that he needed to check whether the inmate had any new tattoos and ordering the inmate to remove all his clothing. The inmate had tattoos on his legs, chest, hipbones, arms and groin, and Cotney felt all the tattoos, according to his plea agreement.
Cotney admitted to falsely accusing a fourth inmate of possessing contraband and ordering that inmate into lockdown for 45 days and then having him transferred to a state prison, all in retaliation for the man rejecting a sexual proposition from Cotney.
By pleading guilty to four of the eight charges in the indictment, Cotney could face a year in prison on each of the four counts of using his authority as a jail administrator to deprive the inmates of their civil rights.
The FBI and the Alabama Bureau of Investigation investigated the case, which Assistant U.S. Attorney Tamarra Matthews Johnson is prosecuting.
Clay County Jail Administrator Pleads Guilty to Violating Inmates' Civil RightsRead the Press Release
BIRMINGHAM -- The former jail administrator of the Clay County Detention Center pleaded guilty Wednesday to violating the civil rights of inmates by using his authority to sexually abuse or otherwise deprive the inmates of their constitutional rights, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.
JEFFREY SCOTT COTNEY, 48, of Ashland, entered his plea before U.S. District Judge L. Scott Coogler to four counts of deprivation of rights under color of law between May 2009 and spring 2010 while he worked as Clay County's jail administrator. As part of that job, Cotney ran the inmate worker program, recommending which inmates could participate in the program and supervising the inmate workers.
A federal grand jury indicted Cotney in November. His sentencing is scheduled May 27.
As part of Cotney's plea agreement with the government, he must register as a sex offender, surrender all current law enforcement licenses and certifications and neither seek nor hold a law enforcement job or one where he would have custodial authority over others, including as a correctional or probation officer or bail bondsman.
Cotney pleaded guilty to four counts involving three inmates, but the conduct he admitted to in his plea agreement also includes a fourth inmate.
In his plea, Cotney admitted to coercing one inmate to submit to a sexual act on four occasions in 2009, three times at Cotney's home and once on the side of the road during a trip to Oxford to get automobile parts.
Cotney admitted to violating the civil rights of a second inmate in 2009, forcing that inmate to submit to a strip search with no law enforcement justification.
Cotney admitted to repeatedly and improperly grabbing and touching a third inmate in 2009 and 2010, including telling the inmate that he needed to check whether the inmate had any new tattoos and ordering the inmate to remove all his clothing. The inmate had tattoos on his legs, chest, hipbones, arms and groin, and Cotney felt all the tattoos, according to his plea agreement.
Cotney admitted to falsely accusing a fourth inmate of possessing contraband and ordering that inmate into lockdown for 45 days and then having him transferred to a state prison, all in retaliation for the man rejecting a sexual proposition from Cotney.
By pleading guilty to four of the eight charges in the indictment, Cotney could face a year in prison on each of the four counts of using his authority as a jail administrator to deprive the inmates of their civil rights.
The FBI and the Alabama Bureau of Investigation investigated the case, which Assistant U.S. Attorney Tamarra Matthews Johnson is prosecuting.
Birmingham Man Gets 12 1/2 Years in Prison for Selling HeroinRead the Press Release
BIRMINGHAM -- A federal judge Thursday sentenced a Birmingham man to more than 12 years in prison for distributing heroin, announced U.S. Attorney Joyce White Vance and federal Drug Enforcement Administration Assistant Special Agent in Charge Clay A. Morris.JAMES DARNELL LEVERT, 31, pleaded guilty in October to two counts of selling heroin in Birmingham in December 2012 . One sale involved .35 grams of heroin; the second sale was .32 grams. U.S. District Judge Inge P. Johnson sentenced Levert to 12 years and seven months in prison, to be followed by four years of supervised release. The judge sentenced Levert as a "career offender" under the federal sentencing guidelines.
Levert's plea follows a plea earlier this month of HAROLD D. MIMS, 31, of Birmingham, to selling heroin that resulted in a death. That charge carries a mandatory minimum 20-year sentence. Mims was charged in connection to the death last year of William C. Wiggins in Tuscaloosa.
Both Levert and Mims were arrested during a roundup of heroin dealers in north Alabama in September. The roundup was part of an initiative launched in 2012 by the U.S. Attorney's Office, the DEA, district attorneys, and many federal, state and local agencies to attack the supply of heroin in the Northern District of Alabama.
"It is gratifying that so many law enforcement agencies in north Alabama recognize the dangerous scope of the heroin problem in our district and that they came together last year to take dealers off the streets," Vance said. "The roundup brought an immediate drop in the number of heroin overdose deaths in north Alabama, which have spiraled in the last few years, and helped to alert the community that the deadly problem exists here."
"As more of these defendants are sentenced, I hope more people realize that the heroin problem is real, and that selling heroin will lead to prison. If you sell heroin that causes a death, you will be prosecuted and you will get at least 20 years in prison," she said.
As a result of the September sweep, 49 people were indicted on drug distribution charges over the first several months of 2013. Of those 49 defendants, 39 have pleaded guilty, one was tried and convicted, four cases were dismissed, four are in pre-trial diversion programs, and one defendant remains a fugitive.
The DEA investigated the cases in conjunction with many state and local agencies. Assistant U.S. Attorney L. James Weil Jr. is prosecuting the cases.
Former Attorney Pleads Guilty to Securities and Bank FraudRead the Press Release
ANNISTON -- A former Birmingham attorney pleaded guilty today in federal court to charges connected with a securities fraud scheme involving the fraudulent taking of more than $2.8 million dollars in investment funds, announced U.S. Attorney Joyce White Vance, FBI Special Agent in Charge Richard D. Schwein Jr. and Alabama Securities Commission Director Joseph Borg.CHRISTOPHER SHAWN LINTON, 34, of Alabaster, entered his plea before U.S. District Judge Virginia Emerson Hopkins to one count each of wire fraud, mail fraud, securities fraud and money laundering as part of the investment fraud scheme. He also pleaded guilty to one count of bank fraud arising out of the submission of a fraudulent commercial loan application to Iberia Bank for a loan of $908,650.
As part of his plea agreement, Linton is required to pay $2.5 million in restitution to the investors he defrauded, and to pay restitution to Iberia Bank in an amount that will be determined at sentencing. Sentencing is scheduled May 29.
"This Commission is proud to be able to combine our efforts and resources with those of the U.S. Attorney's Office, Northern District of Alabama, and the FBI, to achieve a just and strong conviction against Linton," Borg said. "Hopefully, this verdict will provide some relief to victims involved in this case who were defrauded out of their hard-earned dollars."
According to Linton's plea agreement, he conducted the securities fraud scheme as follows:
In 2007, Linton became an officer, partner and part owner of a business known as Integrity Capital Inc., by purchasing stock in the company. Integrity Capital Inc. was a factoring business located in the greater Birmingham area. Its business was to make advance payments to lawyers who had submitted payment vouchers for work performed for the State of Alabama. Integrity Capital would then receive the voucher payments from the state and keep a percentage as a fee.
In 2009, Linton formed Integrity Capital LLC. Beginning about August 2009, Linton recruited investment advisors to solicit investments in Integrity Capital LLC, in order to purchase the assets and capital stock of Integrity Capital Inc. Between September 2009 and December 2011, 12 individuals invested more than $2.8 million in Integrity Capital LLC. The investors mailed, wired or delivered money to Linton, who deposited the money into one of several bank accounts held by the law firm where he was a partner.
After receiving the investor funds, Linton fraudulently converted them for personal use by writing personal checks to himself and by using the funds for non-investment purposes. The non-investment purposes included, but were not limited to, the purchase of his personal residence, construction projects at the residence, private jet flights, vacations, recreational vehicles, furniture, luxury items, Auburn football tickets and a donation to the Heisman Trophy Trust.
Linton committed bank fraud in January 2012 when he submitted fraudulent personal financial statements to Iberia Bank and received two commercial loans totaling $908,650, according to his plea agreement. His financial statements inflated the value of his personal residence and falsely stated that he owned the residence and other real property.
The maximum penalty for wire fraud and for mail fraud is 20 years in prison and a $250,000 fine; the maximum penalty for money laundering is 10 years in prison and a $250,000 fine; and the maximum penalty for securities fraud is five years in prison and a $250,000 fine. The maximum penalty for bank fraud is 30 years in prison and a $1 million fine.
The FBI and Alabama Securities Commission investigated the case, which Assistant U.S. Attorney Robin Beardsley Mark is prosecuting along with Assistant Attorney General Greg Biggs with the Alabama Securities Commission.Former Claims Representative for the Social Security Administration Indicted for Stealing Personal Identifying Information and Money from AgencyRead the Press Release
BIRMINGHAM -- A federal grand jury has indicted a former Social Security Administration claims representative for using his position to steal identifying information and benefits from Social Security beneficiaries, announced U.S. Attorney Joyce White Vance and Social Security Administration, Office of Inspector General, Special Agent in Charge Guy Fallen.
A 10-count indictment filed in U.S. District Court charges ALEX JAMANE FLOWERS, 33, of Fairfield, with wire fraud, theft of government property and aggravated identity theft in a scheme to obtain money and property fraudulently from the SSA.
Flowers was a claims representative in the SSA Birmingham District Office between May 2013 and July 2013 when the crimes occurred. The duties of a claims representative include, but are not limited to, obtaining, clarifying and verifying information which will be used to analyze claims and make decisions regarding entitlement to benefits. His job responsibilities required that he have access to SSA databases, including the National Computer Center, which houses records for Social Security beneficiaries.
According to the indictment, Flowers used his access to accounts and identifying information of beneficiaries, including Social Security numbers, to cause SSA to issue payments to claimants and beneficiaries, and directed each payment into accounts that he controlled.
The indictment charges Flowers with seven counts of wire fraud for each interstate communication he made to cause a payment to be issued. He faces one count of theft of government property for embezzling money from the SSA, and two counts of aggravated identity theft for unlawfully using someone else's Social Security number in relation to the wire fraud and government property theft.
The maximum penalty for wire fraud is 20 years in prison and a $250,000 fine. The maximum penalty for theft of government property is 10 years in prison and a $250,000 fine. Aggravated identity theft carries a minimum two-year prison term and a $250,000 fine.
SSA-OIG investigated the case, which the United States Attorney’s Office for the Northern District of Alabama is prosecuting.
The public is reminded that an indictment contains only charges. A defendant is presumed innocent and it will be the government's responsibility to prove guilt beyond a reasonable doubt at trial.Colbert County Sheriff's Capt. Timothy Vanderford Receives Federal Law Enforcement AwardRead the Press Release
TUSCUMBIA -- Colbert County Sheriff's Capt. Timothy Bryan Vanderford today received a national law enforcement award recognizing his integral role in the multi-agency investigation and federal prosecution of Ricky Walter Denton for armed bank robbery, identity theft and filing false federal tax returns.U.S. Attorney Joyce White Vance, Internal Revenue Service Criminal Investigation Special Agent in Charge Veronica Hyman-Pillot, FBI Special Agent in Charge Richard D. Schwein Jr., and Colbert County Sheriff Ronnie May announced the presentation of Vanderford's award.
James Nolan, president of the Birmingham-based chapter of the Federal Law Enforcement Officers Association, presented Vanderford with the FLEOA's 2012 State, County, Local or Special Police Investigative Award in a ceremony at the Colbert County Sheriff's Office in Tuscumbia. IRS Criminal Investigation Special Agent Matt Austin nominated Vanderford for the award. FLEOA presents national awards annually and last year announced Vanderford as its only 2012 recipient in the State, County, Local or Special Police category.
Vanderford, now Colbert County's chief investigator, was a sergeant in the department's Investigations Section when Denton, of Tuscumbia, robbed First Southern Bank in Colbert County in December 2009. The FBI and the Colbert County Sheriff's Office began investigating the bank robbery, and Vanderford was instrumental in conducting interviews, executing search warrants and testifying in hearings and at the trial that led to Denton's armed bank robbery conviction, Austin said in his nomination letter. During the course of the robbery investigation, Vanderford discovered that Denton also was running a federal tax fraud scheme by using stolen identities of Alabama State Prison inmates to create false tax returns. At the time of Denton's prosecution in 2011, the prison identity-theft scheme was the largest known to the IRS in Alabama, according to Austin. Denton and a co-conspirator, Joann Choat, stole $148,000 from the IRS while Denton was in the state prison system.
"Capt. Tim Vanderford is an intelligent, hardworking, very capable investigator who is extremely diligent in reviewing all aspects of a case for the victim," Sheriff May said. "I am proud for him; he truly deserves this award."
"It is always a privilege to work with local law enforcement in an effort to protect and serve the public. We are extremely pleased that Capt. Vanderford, during the investigation, recognized the identity theft scheme and collaborated with us and other law enforcement to bring it to an end," said IRS SAC Hyman-Pillot. "Capt. Vanderford's years of training, hard work and perseverance have served him well, and we look forward to working with him again in the future."
"Capt. Vanderford's tenacity and attention to detail led to uncovering additional crimes, for which Denton and Choat are now being held accountable. This was simply outstanding work on his part and exemplifies what can be accomplished when law enforcement comes together in a spirit of cooperation with a common goal," said FBI SAC Schwein.
Vanderford began his law enforcement career with the Colbert County Sheriff's Office in 1996. He has received many awards for his work during that time, including Officer of the Year from both the Sheffield Elks Lodge and the Colbert County Exchange Club, 1999; Roper Marksmanship Award for Colbert County, 2000; and Alabama Governor's Office Law Enforcement Medal of Distinction, 2008. Vanderford also is a recent graduate of the FBI National Academy.Sylacauga Man Pleads Guilty to Defrauding TVA with Inflated InvoicesRead the Press Release
BIRMINGHAM -- A Sylacauga man pleaded guilty today in federal court to a $72,000 wire fraud in connection with a scheme to defraud the Tennessee Valley Authority, announced U.S. Attorney Joyce White Vance.
FRANK LEWIS CONN, 49, entered his plea before U.S. District Judge Karon O. Bowdre to one count of wire fraud. His sentencing is scheduled May 28.
According to the October indictment against Conn, he devised a scheme to defraud the TVA by submitting fraudulently inflated invoices for removing vegetation from power lines and other TVA property between February 2009 and October 2009. During that time, Conn was an owner and manager of Conn Equipment Rental Company, which was doing business as Vegetation Management Services.
The TVA Office of the Inspector General investigated the case, which Assistant U.S. Attorney David Estes is prosecuting.
U. S. Attorney’s Office Collects $14.5 Million in Civil Actions, Criminal Actions & Forfeitures in FY 2013Read the Press Release
BIRMINGHAM – The U.S. Attorney's Office for the Northern District of Alabama collected $2.3 million in Fiscal Year 2013 from criminal and civil actions, and an additional $12.2 million in criminal and civil forfeitures, announced U.S. Attorney Joyce White Vance.
In addition to the $2.3 million the office collected on its own through civil and criminal actions, it worked with other U.S. Attorney's Offices or Justice Department components to collect an additional $184 million in cases pursued jointly. The Northern District of Alabama participated in 2013 collections resulting from the Justice Department's $184 million fair lending settlement with Wells Fargo Bank.
U.S. Attorney General Eric Holder announced today that the Justice Department collected about $8.1 billion in civil and criminal actions in the fiscal year ending Sept. 30. The more than $8 billion in collections represents nearly three times the appropriated $2.76 billion budget for the 94 U.S. Attorney’s offices and the main litigating divisions for the 2013 fiscal year.
"The Department’s enforcement actions help to not only ensure justice is served, but also deliver a valuable return to the American people,” Holder said. “It is critical that Congress provide the resources necessary to match the Department’s mounting caseload. As these figures show, supporting our federal prosecutors is a sound investment.”
"I am proud of the hard work by employees in my office that allowed us to return more money to the taxpayer than we were allotted in our budget for the year," Vance said. "The $14.5 million we collected and recovered through forfeitures in local matters, along with the $184 million we worked with other offices and the Justice Department to collect, should leave no doubt that the U.S. Attorney's Office in North Alabama renders a great service to our community," she said.
Of the $2.3 million collected through civil and criminal actions in the Northern District of Alabama alone, $2.1 million was collected as part of criminal prosecutions and $216,562 was recovered through civil lawsuits and debt collections.
Among the cases that led to the office's $12.2 million in asset forfeitures was the conspiracy, fraud and money laundering conviction of Maurice William Campbell Jr. in a scheme to use his position as director of the Alabama Small Business Development Consortium to obtain $7.3 million from the state. A federal judge last year sentenced Campbell to 15 years in prison and ordered him to pay $5.9 million in restitution to the State of Alabama and to forfeit $7.6 million to the federal government as proceeds of illegal activity. The office seized $1.2 million in assets in the 2013 fiscal year towards the forfeiture judgment. Three other people who worked with Campbell were convicted in the fraud scheme.
The U.S. Attorneys’ Offices, along with the Justice Department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S., and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid directly to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.
The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws. In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration, and Department of Education.
Forfeited assets are deposited into the Department of Justice Assets Forfeiture Fund and are used to restore funds to crime victims and for a variety of law enforcement purposes.
For further information, the United States Attorneys’ Annual Statistical Reports can be found on the internet at http://www.justice.gov/usao/reading_room/foiamanuals.html
Birmingham Man Sentenced to Nearly Three Years in Prison for Multi-Million Dollar Tax SchemeRead the Press Release
BIRMINGHAM – A federal judge today sentenced a Birmingham man to nearly three years in prison and ordered him to repay the government $1.3 million for his scheme to collect millions of dollars from the Internal Revenue Service on false tax returns, announced U.S. Attorney Joyce White Vance and IRS Criminal Investigation Division Special Agent in Charge Veronica Hyman-Pillot.
U.S. District Judge L. Scott Coogler sentenced DOUGLAS ERVIN DENT, 67, to 33 months in prison on 20 counts of false claims against the government. Dent must serve three years of supervised release after completing his prison sentence. A federal grand jury indicted Dent in April. He pleaded guilty to the charges in August.
"This defendant will now go to prison for the $11 million worth of false tax returns he submitted to the IRS," Vance said. "The tax fraud he perpetrated is both a crime and an affront to the millions of hard-working Americans who pay their justly owed taxes each year. Criminals who scheme to avoid paying taxes or to steal money from the U.S. Treasury will be prosecuted."
“Today’s sentence of Mr. Dent should serve as a deterrent to individuals who attempt to manipulate our nation’s tax system,” Hyman-Pillot said. “As we approach tax filing season, individuals should be aware of the consequences of filing false claims, as evidenced today. IRS Criminal Investigation will continue its aggressive pursuit of those individuals who devise schemes to defraud the federal government.”
Dent was convicted of filing 20 false income tax returns in his own name and on behalf of others between April 2008 and October 2009. Dent knew that he and the other taxpayers were not entitled to the $11 million in refunds he claimed, according to court records. Each false tax return claimed that money was earned by the taxpayer and withheld by various financial institutions on behalf of the taxpayer during the tax year, and that the taxpayer was entitled to refund of those withholdings from the IRS. In truth, no such earnings and withholdings had occurred.
Among the 20 false returns, Dent filed four in his name and one in the name of his deceased mother. As a result of one of the false returns, Dent received a tax refund of $533,673 from the IRS.
In accordance with Dent's plea agreement with the government, prosecutors recommended a 33-month prison sentence, based on Dent's cooperation in the case.
Social Security Customer Service Employee Indicted for Stealing Information and Money from AgencyRead the Press Release
BIRMINGHAM -- A federal grand jury today indicted a Social Security Administration telephone service center employee for using his position to steal identifying information and benefits from Social Security beneficiaries, announced U.S. Attorney Joyce White Vance and Social Security Administration, Office of Inspector General, Special Agent in Charge Guy Fallen.
A 14-count indictment filed in U.S. District Court charges TABARIS ARCHIE BROWN, 35, of Montgomery, with wire fraud, theft of government property and aggravated identity theft in a scheme to obtain money and property fraudulently from the SSA.
Brown was a teleservice representative in the SSA Teleservice Center in Birmingham between April 2013 and July 2013 when the crimes occurred. The administration's teleservice centers across the United States accept toll-free calls from the public. In Brown's job as a customer service representative, he received calls and answered inquiries from SSA beneficiaries. His job responsibilities required that he have access to SSA databases, including the National Computer Center, which houses the Master Beneficiary Record for Social Security beneficiaries.
According to the indictment, Brown used his access to accounts and identifying information of beneficiaries, including Social Security numbers, contained in the NCC to alter bank deposit information for particular beneficiaries and to change the information for 11 beneficiaries so that each person's benefits would be paid into accounts that he controlled.
The indictment charges Brown with 11 counts of wire fraud for each interstate communication he made to change bank information in the Social Security Master Beneficiary Record. He faces one count of theft of government property for embezzling money from the SSA, and two counts of aggravated identity theft for unlawfully using someone else's Social Security number in relation to the wire fraud and government property theft.
The maximum penalty for wire fraud is 20 years in prison and a $250,000 fine. The maximum penalty for theft of government property is 10 years in prison and a $250,000 fine. Aggravated identity theft carries a minimum two-year prison term and a $250,000 fine.
SSA-OIG investigated the case, which Assistant U.S. Attorney Tamarra Matthews Johnson is prosecuting.
The public is reminded that an indictment contains only charges. A defendant is presumed innocent and it will be the government's responsibility to prove guilt beyond a reasonable doubt at trial.
Postal Service Employees Indicted for Stealing Postal Money OrdersRead the Press Release
Postal Service Employees Indicted for Stealing Postal Money Orders
BIRMINGHAM -- A federal grand jury today indicted two U.S. Postal Service employees in different post offices for each stealing more than $27,000 in money orders or other postal funds, announced U.S. Attorney Joyce White Vance and Postal Service, Office of Inspector General, Special Agent in Charge Maximo Eamiguel.
In separate indictments filed in U.S. District Court, GERMAINE FOSTER, 36, of Birmingham, and SHARON HARRISON, 56, of Maplesville, are charged with theft of U.S. Postal money orders and theft of government property.
Foster worked in the Maylene post office and Harrison worked at the Shelby post office. Foster is charged with stealing about $27,650 in money orders and other postal funds. Harrison is charged with stealing about $27,291 in money orders.
Theft of Postal Service money orders carries a maximum penalty of five years in prison and a $250,000 fine. Theft of government property carries a maximum sentence of 10 years in prison and a $250,000 fine.
U.S. Postal Service, OIG, investigated the cases, which Assistant U.S. Attorney Frank M. Salter is prosecuting.
The public is reminded that an indictment is only a charge. A defendant is presumed innocent and it will be the government's responsibility to prove guilt, beyond a reasonable doubt, at trial.
Jasper Man Pleads Guilty to Walker County Bank Robbery and Bomb ThreatsRead the Press Release
BIRMINGHAM -- A Jasper man pleaded guilty today in federal court to armed robbery of a Walker County bank, calling in bomb threats on a hospital and a highway bridge before the robbery, and possessing guns as a convicted felon, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.
BRANDON JOSEPH PEAKE, 32, pleaded guilty before U.S. District Judge Karon O. Bowdre to the July 5 armed robbery of Traders and Farmers Bank on Curry Highway in Jasper and to brandishing a gun during the robbery, a Heckler & Koch .40-caliber pistol that he pointed at one of the tellers. Peake also pleaded guilty to using a telephone to make false bomb threats against Walker Baptist Medical Center and a bridge spanning Alabama Highway 69. Peake called in the bomb threats on July 5, before the afternoon bank robbery, according to his plea agreement with the government.
The hospital was evacuated, a police bomb squad dispatched, and the bridge and a stretch of Highway 69 closed because of the bomb threats, according to court documents.
Peake, who was convicted in Jefferson County Circuit Court in August 2012 for felony possession of a controlled substance, pleaded guilty today to three counts of being a felon in possession of a firearm.
A Walker County Sheriff's deputy found the H&K .40-caliber pistol used in the robbery of Traders and Farmers Bank in woods near the bank. The gun was traced to Peake, who bought it in 2007.
Peake also acknowledged that he traveled to Tupelo, Miss., two days after the bank robbery to meet an acquaintance who sold him a Glock 9mm pistol and a Bushmaster .223-caliber semi-automatic rifle. The fourth gun Peake possessed illegally was a Beretta 9mm pistol, found July 11 in the Chattanooga hotel room where police arrested him for the Walker County bank robbery.
Peake's sentencing is scheduled April 21.
The maximum sentence for armed bank robbery is 25 years in prison and a $250,000 fine. The sentence for brandishing a firearm during a crime of violence is seven years to life in prison, which must be served after completion of any other sentence imposed for the crime. The maximum sentence for using a telephone to maliciously convey a false threat to burn or bomb a building is 10 years in prison and a $250,000 fine. The maximum penalty for being a convicted felon in possession of a firearm is 10 years in prison and a $250,000 fine.
The FBI, Walker County Sheriff's Office and the Walker County District Attorney's Office investigated the case. Special Assistant U.S. Attorney E. Wilson Hunter is prosecuting the case.
Ball Cap Bandit Pleads Guilty to Eleven Bank RobberiesRead the Press Release
HUNTSVILLE -- A Huntsville man who was dubbed the Ball Cap Bandit because he often wore a ball cap during his crime spree pleaded guilty today in federal court to 11 counts of bank robbery, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.
CEDRICK LAMOND HICKS, 33, entered a guilty plea before U.S. District Judge Virginia Emerson Hopkins to 11 counts of bank robbery. Ten of those were in Alabama and one was in Tennessee. Hicks’ sentencing is scheduled March 25 in Huntsville.The date, location and amount of money stolen in the robberies Hicks pleaded guilty to are as follows:
• Feb. 22, 2012, Regions Bank, Madison Street, Huntsville, $2,870.
• March 23, 2012, First Jackson Bank, Sutton Road, Huntsville, $1,894.
• April 30, 2012, Renasant Bank, U.S. 72 West, Madison, $3,500.
• Aug. 2, 2012, Peoples Bank, U.S. 431 South, Guntersville, $890.
• Aug. 8, 2012, Traditions Bank, Alabama 67 South, Decatur, $7,243.
• Sept. 19, 2012, First National Bank of Pulaski, South First Street, Pulaski, Tenn., $23,067.
• Nov. 27, 2012, Regions Banks, Lee Street, Rogersville, $8,009.
• Jan. 7, 2013, Peoples Trust Bank, Military Street South, Hamilton, $9,000.
• March 6, 2013, ServisFirst Bank, Meridian Street, Huntsville, $6,575.
• Sept. 18, 2012, Cadence Bank, U.S. 431, Albertville, no money taken.
• Nov. 26, 2012, Traditions Bank, Second Avenue NW, Cullman, no money taken.
Hicks faces a maximum penalty of 20 years in prison and a $250,000 fine for each robbery. The government also will seek restitution for the victims of his crimes.
The FBI investigated the case. Assistant U.S. Attorney Mary Stuart Burrell is prosecuting the case.Huntsville Man Must Pay $3.7 Million to IRS for Tax EvasionRead the Press Release
HUNTSVILLE -- A federal judge this week sentenced a Huntsville man to five years' probation for tax evasion but ordered him to pay $3.7 million in restitution to the government, announced U.S. Attorney Joyce White Vance and Internal Revenue Service Criminal Investigation Special Agent in Charge Veronica Hyman-Pillot.
U.S. District Judge Abdul K. Kallon sentenced PAUL BRACY JR., 71, on one count of tax evasion. The U.S. Attorney's Office charged Bracy in July. Bracy owned several small businesses: Bracy's Vending and the Green Room Lounge in Madison County and PBS Blues Bar in Macon County. Bracy also owned four pieces of real property, two in Madison County, one in Choctaw County and one in Mobile County.
According to court documents, the IRS was about to determine Bracy was personally responsible for $60,995 in unpaid taxes associated with businesses he owned, when Bracy conveyed the four pieces of real property, via “sham transactions,” to others in order to avoid IRS seizure of the properties to satisfy the outstanding tax amount. As part of his plea agreement, Bracy agreed to pay the $3,747,650 in restitution to the government.
“Most citizens diligently pay their taxes,” Vance said. “The willful failure of others to do so is patently unfair and criminal. We will aggressively seek to investigate and prosecute those individuals.”
"Business owners have a responsibility to withhold income taxes for their employees and then remit those taxes to the Internal Revenue Service," Hyman-Pillot said. "The failure to pay over withheld taxes is a serious offense. IRS Criminal Investigation vigorously pursues anyone who collects taxes and fails to timely remit those taxes."
The IRS-CI investigated the case, which the U.S. Attorney's Office for the Northern District of Alabama prosecuted.
Former Narcotics Task Force Officer Sentenced to A Year in Prison for Embezzling Seized MoneyRead the Press Release
BIRMINGHAM – A federal judge today sentenced the former commander of the West Alabama Narcotics Task Force to one year and a day in prison for stealing at least $125,000 from suspected drug proceeds seized by the multi-agency task force, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.
JEFFREY LYNN SNYDER, 55, of Carrollton, pleaded guilty in June to one count of theft from a program that received more than $10,000 in federal benefits within a one-year period. U.S. District Court Judge Inge P. Johnson sentenced Snyder to prison and, in accordance with the plea agreement he entered with the government in May, ordered him to pay $125,000 restitution to the West Alabama Narcotics Task Force.
The U.S. Attorney's Office charged Snyder in May with embezzling the task force money between June 2010 and June 2012, when he left the task force.
"Joint task force operations are an important part of the combined law enforcement effort to control illegal drug trafficking. This theft by a city police captain impaired the financial condition of the unit and violated the trust placed in him by fellow officers," Vance said. "Police officers who violate their oath to protect and serve the public are rare, but those who breach that trust must be prosecuted and held to account."
"Honesty and integrity are fundamental guiding principles for any law enforcement officer, regardless of rank or position," Schwein said. "Fortunately, Mr. Snyder's actions are not reflective of the vast majority of the men and women in law enforcement who go to work every day to protect and serve while upholding the principles of honesty and integrity. Today, Mr. Snyder pays the price for his actions and is being held accountable for violating the trust the good people of West Alabama placed in him."
The West Alabama Narcotics Task Force is composed of officers from the Tuscaloosa Police Department, Tuscaloosa County Sheriff's Office, Northport Police Department and University of Alabama Police Department. It is tasked to investigate all drug crimes in Tuscaloosa County.Snyder was a 29-year member of the Tuscaloosa Police Department, retiring as a captain in December 2012. He was detailed to the narcotics task force in 1989 and became its commander in June 2002, according to court records.
Task force members periodically seized money suspected to be proceeds of illegal drug transactions and turned the money in to Snyder, who was responsible for depositing the money into bank accounts while condemnation proceedings were pursued through court, according to his plea agreement. Snyder was entrusted to receive the seized money, log it in task force ledger books and deposit it in task force bank accounts.
Snyder began embezzling from the seized funds no later than June 2010. He executed his scheme "by pocketing some or all of the funds seized during various arrests, and then failing to correctly account for those funds," he acknowledged in his plea agreement.
The FBI investigated the case, with assistance from the West Alabama Narcotics Task Force. Assistant U.S. Attorney Henry Cornelius prosecuted the case.
Former Narcotics Task Force Officer Sentenced to A Year in Prison for Embezzling Seized MoneyRead the Press Release
BIRMINGHAM – A federal judge today sentenced the former commander of the West Alabama Narcotics Task Force to one year and a day in prison for stealing at least $125,000 from suspected drug proceeds seized by the multi-agency task force, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.
JEFFREY LYNN SNYDER, 55, of Carrollton, pleaded guilty in June to one count of theft from a program that received more than $10,000 in federal benefits within a one-year period. U.S. District Court Judge Inge P. Johnson sentenced Snyder to prison and, in accordance with the plea agreement he entered with the government in May, ordered him to pay $125,000 restitution to the West Alabama Narcotics Task Force.
The U.S. Attorney's Office charged Snyder in May with embezzling the task force money between June 2010 and June 2012, when he left the task force.
"Joint task force operations are an important part of the combined law enforcement effort to control illegal drug trafficking. This theft by a city police captain impaired the financial condition of the unit and violated the trust placed in him by fellow officers," Vance said. "Police officers who violate their oath to protect and serve the public are rare, but those who breach that trust must be prosecuted and held to account."
"Honesty and integrity are fundamental guiding principles for any law enforcement officer, regardless of rank or position," Schwein said. "Fortunately, Mr. Snyder's actions are not reflective of the vast majority of the men and women in law enforcement who go to work every day to protect and serve while upholding the principles of honesty and integrity. Today, Mr. Snyder pays the price for his actions and is being held accountable for violating the trust the good people of West Alabama placed in him."
The West Alabama Narcotics Task Force is composed of officers from the Tuscaloosa Police Department, Tuscaloosa County Sheriff's Office, Northport Police Department and University of Alabama Police Department. It is tasked to investigate all drug crimes in Tuscaloosa County.Snyder was a 29-year member of the Tuscaloosa Police Department, retiring as a captain in December 2012. He was detailed to the narcotics task force in 1989 and became its commander in June 2002, according to court records.
Task force members periodically seized money suspected to be proceeds of illegal drug transactions and turned the money in to Snyder, who was responsible for depositing the money into bank accounts while condemnation proceedings were pursued through court, according to his plea agreement. Snyder was entrusted to receive the seized money, log it in task force ledger books and deposit it in task force bank accounts.
Snyder began embezzling from the seized funds no later than June 2010. He executed his scheme "by pocketing some or all of the funds seized during various arrests, and then failing to correctly account for those funds," he acknowledged in his plea agreement.
The FBI investigated the case, with assistance from the West Alabama Narcotics Task Force. Assistant U.S. Attorney Henry Cornelius prosecuted the case.
Hoover Restaurant Owner Charged with Trafficking MarijuanaRead the Press Release
BIRMINGHAM -- The owner of Jubilee Joe's Restaurant in Hoover faces federal drug trafficking, firearms and money laundering charges, announced U.S. Attorney Joyce White Vance and Bureau of Alcohol, Tobacco, Firearms and Explosives Special Agent in Charge Jeffrey L. Fulton.
An eight-count indictment returned by a federal grand jury in October against KASHIF MOHAMMED SIDDIQUI, 32, of Birmingham, was unsealed today following his arrest. The indictment charges Siddiqui with conspiracy to distribute marijuana in Jefferson and Shelby counties between September 2012 and January 2013. The indictment also charges Siddiqui with two counts of distributing marijuana, once on Sept. 6, 2012, and again on Oct. 17, 2012.
The indictment further charges Siddiqui with transferring a Bushmaster .223-caliber semi-automatic rifle in furtherance of a drug-trafficking crime on Oct. 17, 2012, and with selling or loaning a Glock .45-caliber pistol to a convicted felon on Oct. 20, 2012. The indictment also charges Siddiqui with conspiring to conduct a financial transaction involving proceeds of illegal activity on Nov. 19, 2012; and with both possessing with intent to distribute marijuana and possessing a Colt .223-caliber semi-automatic rifle in furtherance of a drug-trafficking crime on Jan. 3, 2013.
The conspiracy and marijuana distribution charges each carry a maximum penalty of five years in prison and a $250,000 fine. Transferring a firearm in furtherance of a drug-trafficking crime and providing a firearm to a known felon both carry a maximum sentence of 10 years in prison and a $250,000 fine. The money-laundering conspiracy charge carries a maximum penalty of 20 years in prison and a fine of either $500,000 or double the amount laundered, whichever is greater. The charge of possessing a firearm in furtherance of a drug-trafficking crime carries a $250,000 fine and a prison term of five years to life in prison, which must be served after completion of any other sentence imposed for the crime.
ATF investigated the case, which Assistant U.S. Attorney E. Wilson Hunter is prosecuting.
The public is reminded that an indictment contains only charges. It is the government's responsibility to prove guilt beyond a reasonable doubt at trial.
Hoover Restaurant Owner Charged with Trafficking MarijuanaRead the Press Release
BIRMINGHAM -- The owner of Jubilee Joe's Restaurant in Hoover faces federal drug trafficking, firearms and money laundering charges, announced U.S. Attorney Joyce White Vance and Bureau of Alcohol, Tobacco, Firearms and Explosives Special Agent in Charge Jeffrey L. Fulton.
An eight-count indictment returned by a federal grand jury in October against KASHIF MOHAMMED SIDDIQUI, 32, of Birmingham, was unsealed today following his arrest. The indictment charges Siddiqui with conspiracy to distribute marijuana in Jefferson and Shelby counties between September 2012 and January 2013. The indictment also charges Siddiqui with two counts of distributing marijuana, once on Sept. 6, 2012, and again on Oct. 17, 2012.
The indictment further charges Siddiqui with transferring a Bushmaster .223-caliber semi-automatic rifle in furtherance of a drug-trafficking crime on Oct. 17, 2012, and with selling or loaning a Glock .45-caliber pistol to a convicted felon on Oct. 20, 2012. The indictment also charges Siddiqui with conspiring to conduct a financial transaction involving proceeds of illegal activity on Nov. 19, 2012; and with both possessing with intent to distribute marijuana and possessing a Colt .223-caliber semi-automatic rifle in furtherance of a drug-trafficking crime on Jan. 3, 2013.
The conspiracy and marijuana distribution charges each carry a maximum penalty of five years in prison and a $250,000 fine. Transferring a firearm in furtherance of a drug-trafficking crime and providing a firearm to a known felon both carry a maximum sentence of 10 years in prison and a $250,000 fine. The money-laundering conspiracy charge carries a maximum penalty of 20 years in prison and a fine of either $500,000 or double the amount laundered, whichever is greater. The charge of possessing a firearm in furtherance of a drug-trafficking crime carries a $250,000 fine and a prison term of five years to life in prison, which must be served after completion of any other sentence imposed for the crime.
ATF investigated the case, which Assistant U.S. Attorney E. Wilson Hunter is prosecuting.
The public is reminded that an indictment contains only charges. It is the government's responsibility to prove guilt beyond a reasonable doubt at trial.
Childersburg City Councilwoman Pleads Guilty to Bank Fraud and Money LaunderingRead the Press Release
BIRMINGHAM -- A Childersburg City Councilwoman pleaded guilty today in federal court to bank fraud and laundering nearly $1 million from SouthFirst Bank in Childersburg, announced U.S. Attorney Joyce White Vance, U.S. Secret Service Special Agent in Charge Craig Caldwell, and IRS Criminal Investigation Supervisory Special Agent in Charge Veronica Hyman-Pillot.
Federal prosecutors charged BONNY JEAN CARTER in October with the nearly $1million embezzlement from SouthFirst Bank. According to the charge and her guilty plea before Senior U.S. District Judge Inge P. Johnson, Carter, 61, worked as an account clerk at SouthFirst Bank. In that position, between October 2002 and March 2013, Carter embezzled funds held by SouthFirst Bank by converting the money to personal savings accounts. Carter recorded journal entries to transfer money from various SouthFirst Bank general ledger accounts into personal accounts held in her daughter's name. She also skimmed amounts from checks made payable to SouthFirst Bank by depositing the funds into those personal accounts. Additionally, Carter issued debit transactions from SouthFirst Bank’s operating expense account to pay personal debts she owed.
As part of a plea agreement Carter entered with the government in October, she is responsible for repaying $951,787 to SouthFirst Bank. Her sentencing is scheduled March 11.
The maximum penalty for bank fraud is 30 years in prison and a $1 million fine, and the maximum penalty for money laundering is 10 years in prison and a $250,000 fine.
The U.S. Secret Service and Internal Revenue Service investigated the case, which Assistant U.S. Attorney Robin Beardsley Mark is prosecuting.
Childersburg City Councilwoman Pleads Guilty to Bank Fraud and Money LaunderingRead the Press Release
BIRMINGHAM -- A Childersburg City Councilwoman pleaded guilty today in federal court to bank fraud and laundering nearly $1 million from SouthFirst Bank in Childersburg, announced U.S. Attorney Joyce White Vance, U.S. Secret Service Special Agent in Charge Craig Caldwell, and IRS Criminal Investigation Supervisory Special Agent in Charge Veronica Hyman-Pillot.
Federal prosecutors charged BONNY JEAN CARTER in October with the nearly $1million embezzlement from SouthFirst Bank. According to the charge and her guilty plea before Senior U.S. District Judge Inge P. Johnson, Carter, 61, worked as an account clerk at SouthFirst Bank. In that position, between October 2002 and March 2013, Carter embezzled funds held by SouthFirst Bank by converting the money to personal savings accounts. Carter recorded journal entries to transfer money from various SouthFirst Bank general ledger accounts into personal accounts held in her daughter's name. She also skimmed amounts from checks made payable to SouthFirst Bank by depositing the funds into those personal accounts. Additionally, Carter issued debit transactions from SouthFirst Bank’s operating expense account to pay personal debts she owed.
As part of a plea agreement Carter entered with the government in October, she is responsible for repaying $951,787 to SouthFirst Bank. Her sentencing is scheduled March 11.
The maximum penalty for bank fraud is 30 years in prison and a $1 million fine, and the maximum penalty for money laundering is 10 years in prison and a $250,000 fine.
The U.S. Secret Service and Internal Revenue Service investigated the case, which Assistant U.S. Attorney Robin Beardsley Mark is prosecuting.
Clay County Jail Administrator Indicted for Violating Inmates' Civil RightsRead the Press Release
BIRMINGHAM -- A federal grand jury today indicted the former jail administrator of the Clay County Detention Center for violating the civil rights of four inmates by using his authority to sexually abuse or otherwise deprive the inmates of their constitutional rights, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.
An indictment filed in U.S. District Court charges JEFFREY SCOTT COTNEY, 48, of Ashland, with eight counts of deprivation of rights under color of law between May 2009 and spring 2010 while he worked as Clay County's jail administrator.
"It is unacceptable for law enforcement officers who are entrusted with police powers to sexually abuse inmates," Vance said. "People convicted of crimes are to be punished by the justice system according to the rule of law. They should not be subjected to a deprivation of their constitutional rights by one who abuses the power of his badge for personal gratification."
The first four counts of the indictment charge Cotney with coercing an inmate to submit to a sexual act on four separate dates between May 2009 and September 2009. Count Five charges Cotney with depriving that same inmate of his liberty, without due process of law, by withdrawing the inmate's application for acceptance into a community corrections program in Barbour County in order to keep the man confined in the Clay County Detention Center. Cotney falsely represented the inmate's interest in the community corrections program and withdrew his application for the program without the inmate's knowledge, according to the indictment.
Counts Six and Seven charge Cotney with directing two inmates, one in August 2009 and the other in spring 2010, to disrobe and then rubbing the tattoos on their bodies, thereby depriving them of their constitutional rights to be free from unreasonable searches and to possess bodily privacy and integrity.
Count Eight charges Cotney with depriving a fourth inmate of his right to be free from cruel and unusual punishment by falsely accusing the inmate of possessing contraband, ordering him into lockdown for 45 days and having him transferred to a state prison, all in retaliation for the man rejecting a sexual proposition from Cotney.
Cotney could face a total of eight years in prison on all counts charged.
The FBI and the Alabama Bureau of Investigation investigated the case, which Assistant U.S. Attorney Tamarra Matthews Johnson is prosecuting.
The public is reminded that an indictment contains only charges. A defendant is presumed innocent and it is the government's responsibility to prove guilt beyond a reasonable doubt at trial.
Birmingham Man Convicted in Cocaine Trafficking ConspiracyRead the Press Release
BIRMINGHAM -- A federal jury late Monday convicted a Birmingham man in a conspiracy to traffic cocaine between Birmingham and Austin, Texas, announced U.S. Attorney Joyce White Vance and Drug Enforcement Administration Assistant Special Agent in Charge Clay A. Morris.
Following a six-day trial before U.S. District Judge R. David Proctor, the jury convicted ARTAVIS DESMOND McGOWAN, 40, of conspiring with DONALDO FIGUEROA CRUZ, 34, of Austin, Texas, and others, to distribute at least five kilograms of cocaine in Jefferson County between August 2011 and October 2011.
Figueroa pleaded guilty in July to the drug-trafficking conspiracy, possession with intent to distribute 500 grams or more of cocaine, and concealing $110,000 in a hidden compartment behind the bumper of a Lexus sedan in order to secret the money out of the country. Figueroa was sentenced Nov. 6 to 10 years in federal prison.
"McGowan and his conspirators are among the prime movers of illicit drugs into our community and they made hundreds of thousands of dollars selling it," Vance said. "These drugs devastate neighborhoods and fuel violent crime, so it is particularly important that we prosecute those like McGowan who are indifferent to the shattered lives they leave behind when they profiteer off of dangerous drugs," she said."The DEA and the U.S. Attorney's Office, along with our state and local counterparts, worked tirelessly during the investigation of Artavis McGowan," Morris said. "Our partnership with the law enforcement community in Birmingham is dedicated to making our community safer and taking dangerous criminals off the streets of Alabama."
On Oct. 5, 2011, DEA agents seized six bricks of cocaine and other drugs from a home located at 1156 Skyline Drive in Birmingham. Also seized from the house was $341,679 cash. McGowan and his confederates used the home as a "stash" house to remove cocaine from drug "load" vehicles driven from Austin to Birmingham. The basement of the home also was used to process drugs and money, according to evidence at trial.
Evidence further showed that McGowan's fingerprints were found on two of the 46 kilogram wrappers found in the trash in the basement of the Skyline Drive home. In May of this year, DEA agents executed a search warrant at 108 Page Ave. in Birmingham where they found McGowan with more than $61,000 cash.
McGowan is scheduled for sentencing Feb. 25. He faces a sentence of 20 years to life in prison.
The DEA investigated the case, which Assistant U.S. Attorney Gregory R. Dimler prosecuted.Alabama's Immigration Law Permanently Blocked in Justice Department LawsuitRead the Press Release
BIRMINGHAM—The U.S. District Court for the Northern District of Alabama entered its final judgment today in United States v. Alabama, resolving the Justice Department's constitutional challenge to Alabama's immigration law, H.B. 56, U.S. Attorney Joyce White Vance and Assistant Attorney General Stuart Delery of the Department's Civil Division announced.
The judgment permanently prohibits Alabama from enforcing seven provisions of H.B. 56 that were designed to affect virtually every aspect of an unauthorized immigrant's daily life, from employment to housing to transportation to entering into and enforcing contracts. The challenged provisions also threatened to impose significant burdens on federal and state agencies, diverting their resources away from dangerous criminal aliens and other high-priority criminal activity.
"The federal government has been making the nation safer by aggressively prosecuting and deporting criminal aliens in record numbers, and it has done so with the cooperation of our sheriffs and police departments," Vance said. "But H.B. 56 diverted the attention of our state and local partners from violent criminals to ordinary families. The law forced parents to uproot their sons and daughters from their home, and it punished immigrant children for exercising their constitutional right to go to school. Today's decision marks a return to common-sense immigration law enforcement."
"Our system demands that our nation speak with one voice on matters of foreign affairs and immigration policy," Delery added. "In striking down these provisions of H.B. 56, the district court and the Eleventh Circuit have reaffirmed that federal law precludes a patchwork of immigration laws of the type that interferes with federal enforcement, foreign policy, and the rights of lawfully present aliens."
Today's judgment follows the decision by the U.S. Court of Appeals for the Eleventh Circuit declaring the enjoined provisions unconstitutional because they impermissibly conflicted with federal immigration law and undermined federal immigration-enforcement efforts. An additional provision of the Alabama immigration law, requiring immigration-status verification of school children, was permanently enjoined in a parallel lawsuit by private plaintiffs, Hispanic Interest Coalition of Ala. et al. v. Governor of Ala. Today's judgment also dismisses challenges to three other provisions of the Alabama immigration law, although the Justice Department would be able to file a new challenge if the implementation of those provisions raised legal problems.
Hueytown Man Sentenced to 18 Years in Prison for Armed Pharmacy RobberiesRead the Press Release
BIRMINGHAM -- A federal judge today sentenced a Hueytown man to 18 years in prison for a series of armed pharmacy robberies in 2011 and 2012, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.
U.S. District Judge Abdul K. Kallon sentenced ANTHONY YOUNG, 22, in accordance with a binding plea agreement Young entered with the government. The agreement specified an 18-year prison sentence for Young's pleas of guilty to three pharmacy robberies in the Birmingham metro area and to brandishing a firearm during one of the robberies. Cash and controlled substances, including narcotic painkillers, were taken in all three robberies.
Brandishing a firearm during a crime of violence carries a minimum sentence of seven years in prison and a maximum of life, and the sentence must be served after completion of any other sentence imposed for the crime. Judge Kallon sentenced Young to 11 years in prison for the pharmacy robberies, followed by seven years for brandishing the gun during a robbery.
Young pleaded guilty in August to robbing Moore's Pharmacy on Ensley Avenue in Birmingham on July 30, 2011, Campbell's Pharmacy on Veterans Memorial Drive in Adamsville on Aug. 27, 2011, and Helena Hometown Pharmacy on Alabama Highway 17 in Helena on March 13, 2012. He admitted to brandishing a gun during the Helena robbery.
Two co-defendants in the case, Birmingham cousins Willie and Sterling Edwards, pleaded guilty earlier this year to their roles in the pharmacy robberies. Willie Edwards, 40, pleaded guilty to robbing Moore's Pharmacy and to brandishing a gun during the robbery. Judge Kallon sentenced him in April to 20 years and one month in prison.
Sterling Edwards, 21, pleaded guilty to the Helena Hometown pharmacy robbery and to a second robbery at Campbell's pharmacy, on Oct. 13, 2011. He also pleaded guilty to brandishing a gun during the Helena robbery. Judge Kallon sentenced Sterling Edwards in July to 11 years and nine months in prison.
The robbers in all four crimes entered the pharmacies and demanded the narcotics Lortab or Oxycontin, according to court documents.
The FBI and Birmingham, Adamsville and Helena police departments investigated the case. Assistant U.S. Attorneys Joseph P. Montminy and Robin B. Mark prosecuted the case.
Gadsden Man Sentenced to 17 1/2 Years in Prison for 2008 Bank RobberyRead the Press Release
BIRMINGHAM – A federal judge today sentenced a Gadsden man to 17 years and six months in prison for his role in the 2008 robbery of the Wachovia Bank in Lenlock, Ala., announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.
A federal jury in July convicted MARCUS TYSHUN PORTER, 33, of joining in a conspiracy and acting as a lookout during the July 16, 2008, Wachovia Bank robbery. U.S. District Judge Abdul K. Kallon sentenced Porter to prison and ordered him to pay $277,773 restitution to the bank.
Two of Porter’s co-conspirators, WILLIS LEACH, 32, of Gadsden, and JESSE KEY, 43, of Birmingham, pleaded guilty to robbery charges in June. Key also pleaded guilty to carjacking. A third man, GABRIEL RICE, 25, of Gadsden, was charged and pleaded guilty to the robbery and carjacking in 2008.
Immediately after robbing the bank, Key and Rice forced two women at gunpoint to drive them back to Gadsden, where they met Porter and split proceeds of the robbery.
In October, Judge Kallon sentenced Key to 14 years, six months in prison, and Leach to five years and 10 months in prison. In 2009, U.S. District Judge Sharon Lovelace Blackburn sentenced Rice to 17 years in prison.
“The last of the men responsible for these violent crimes is finally on his way to prison," Vance said. “This case is part of a larger investigation involving a string of bank robberies occurring in Gadsden and the surrounding area since 2007. The FBI and the entire Etowah County law enforcement community have continued to work over the past five years to solve these crimes,” she said.
The FBI investigated the case, and Assistant U.S. Attorney L. James Weil Jr. and Special Assistant U.S. Attorney E. Wilson Hunter prosecuted it.Tuscaloosa Man Gets 25 Years in Prison for String of Convenience Store RobberiesRead the Press Release
TUSCALOOSA -- A federal judge today sentenced a Tuscaloosa man to 25 years in prison for his part in a string of armed gas station convenience store robberies in December 2011, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.U.S. District Judge L. Scott Coogler sentenced JUWAN HUNTER, 20, in accordance with a binding plea agreement Hunter entered with the government in July. The agreement specified a 25 year prison sentence for Hunter's pleas of guilty to four Tuscaloosa County robberies and to brandishing a firearm during one of those robberies. Brandishing a firearm during a crime of violence carries a minimum sentence of seven years in prison and a maximum sentence of life, and the sentence must be served after completion of any other sentence imposed for the crime.
Hunter pleaded guilty to robbery of the University Chevron on U.S. 11 in Cottondale on Dec. 8, 2011; the Springbrook Chevron on East McFarland Boulevard in Tuscaloosa on Dec. 16, 2011; the Coaling Marathon Oil on U.S. 11 in Coaling on Dec. 18, 2011; and the Big Sandy Food Mart on Alabama 69 in Moundville on Dec. 21, 2011. He pleaded guilty to brandishing a firearm during the Coaling Marathon Oil robbery.
The FBI, Tuscaloosa Sheriff's Office, Tuscaloosa Police Department and the Coaling Police Department investigated the case. Assistant U.S. Attorney Joseph P. Montminy is prosecuting the case.
Huntsville Man Sentenced for Tax EvasionRead the Press Release
HUNTSVILLE -- A federal judge today sentenced a Huntsville man to five years probation, including eight months home detention, for tax evasion and ordered him to pay $3.7 million in restitution to the government, announced U.S. Attorney Joyce White Vance and Internal Revenue Service Criminal Investigation Special Agent In Charge Veronica Hyman-Pillot.
U.S. District Judge Abdul K. Kallon sentenced PAUL BRACY, 71, on one count of tax evasion. The U.S. Attorney's Office charged Bracy in July. According to court documents, the IRS was about to determine Bracy was personally responsible for $60,995 in unpaid taxes associated with businesses he owned, when Bracy conveyed four pieces of real property, via “sham transactions,” to others in order to avoid IRS seizure of the properties to satisfy the outstanding tax amount. As part of his plea agreement, Bracy agreed to pay the $3,747,650 in restitution to the government.
“Most citizens diligently pay their taxes,” said Vance. “The willful failure of others to do so is patently unfair and criminal. We will aggressively seek to investigate and prosecute those individuals.”
“Individuals who earn income should accurately report their income to the IRS,” stated Veronica F. Hyman-Pillot, Special Agent in Charge with IRS Criminal Investigation. “The sentence today, should reassure Americans, that those individuals who willfully and intentionally violate their known legal duty of filing and paying their fair share of taxes will be prosecuted."
The IRS-CI investigated the case, which was prosecuted by the U.S. Attorney's Office for the Northern District of Alabama.
Federal Grand Jury Indicts Lee County Man for Five North Alabama RobberiesRead the Press Release
BIRMINGHAM -- A federal grand jury today indicted a Lee County man for a string of bank robberies in North Alabama in January, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.
A five-count indictment filed in U.S. District Court charges JIMMY DAWSON CUNNINGHAM JR., 38, of Salem, Ala., with five bank robberies between Jan. 3 and Jan. 14. He is charged with the following robberies: National Bank of Commerce, Shades Creek Parkway, Birmingham, Jan. 3; PNC Bank, Euclid Avenue, Mountain Brook, Jan. 8; First Community Bank, Marktplatz Center, Cullman, Jan. 10; Regions Bank, Culver Road, Mountain Brook, Jan. 10; and Union State Bank, Pelham Parkway, Pelham, Jan. 14.
Cunningham could face a maximum penalty of 20 years in prison and a $250,000 fine for each count.
The FBI, in conjunction with the Jefferson County Sheriff's Office and the Mountain Brook, Cullman and Pelham police departments, investigated the case. Assistant U.S. Attorney Joseph P. Montminy is prosecuting the case.
The public is reminded that an indictment contains only charges. It will be the government's responsibility to prove the defendant's guilt at trial.
Federal Grand Jury Indicts Lee County Man for Five North Alabama RobberiesRead the Press Release
BIRMINGHAM -- A federal grand jury today indicted a Lee County man for a string of bank robberies in North Alabama in January, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.
A five-count indictment filed in U.S. District Court charges JIMMY DAWSON CUNNINGHAM JR., 38, of Salem, Ala., with five bank robberies between Jan. 3 and Jan. 14. He is charged with the following robberies: National Bank of Commerce, Shades Creek Parkway, Birmingham, Jan. 3; PNC Bank, Euclid Avenue, Mountain Brook, Jan. 8; First Community Bank, Marktplatz Center, Cullman, Jan. 10; Regions Bank, Culver Road, Mountain Brook, Jan. 10; and Union State Bank, Pelham Parkway, Pelham, Jan. 14.
Cunningham could face a maximum penalty of 20 years in prison and a $250,000 fine for each count.
The FBI, in conjunction with the Jefferson County Sheriff's Office and the Mountain Brook, Cullman and Pelham police departments, investigated the case. Assistant U.S. Attorney Joseph P. Montminy is prosecuting the case.
The public is reminded that an indictment contains only charges. It will be the government's responsibility to prove the defendant's guilt at trial.
Federal Charges Brought Against 11th Person in Scheme to Defraud BP Oil Spill Claims FundRead the Press Release
BIRMINGHAM – A federal grand jury today indicted a Birmingham woman as part of a conspiracy to fraudulently take money from funds established to pay claims from individuals and businesses harmed by the 2010 Deepwater Horizon oil spill in the Gulf of Mexico, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.
The indictment of FELICIA YOUNGBLOOD, 25, brings to 11 the number of people in North Alabama to face federal charges for conspiring to participate in a scheme to defraud the oil spill claims funds. Youngblood is the second person indicted by a federal grand jury. The U.S. Attorney's Office has charged nine others this year and those nine have pleaded guilty to taking part in the conspiracy.
British Petroleum, which owned the Macondo oil well where the Deepwater Horizon drilling rig exploded, established the Gulf Coast Claims Facility in June 2010 for the purpose of administering and settling claims resulting from the oil spill disaster. A subsidiary of BP established the Deepwater Horizon Oil Spill Trust Fund in August 2010 to pay certain types of claims and expenses from the oil spill, including claims settled through the GCCF.
The four-count indictment of Youngblood charges her with the conspiracy to submit false claims to the GCCF in the summer of 2011 that resulted in her receiving payments of $39,293 and $28,332. The indictment also charges Youngblood with mail fraud, prohibited monetary transactions and wire fraud.According to the indictment, Youngblood carried out the fraud as follows:
Youngblood provided personal information to co-conspirators that was used to prepare and submit false claims of lost earnings to the GCCF. The false claims caused the GCCF to mail a $39,293 check to Youngblood and to wire a separate payment of $28,332 to Youngbloods' bank account. At the direction of co-conspirators, Youngblood used the $39,293 check on July 25, 2011, to obtain two cashier's checks of $17,146 each and $5,000 cash . She endorsed the cashier's checks and gave them to a co-conspirator. On Aug. 4, 2011, Youngblood, at the direction of a co-conspirator, withdrew $10,000 of the $28,332 that had been electronically deposited into her account and gave the money to the co-conspirator.
The FBI is investigating these cases. Assistant U.S. Attorney Henry Cornelius is prosecuting the cases.
The public is reminded than an indictment contains only charges. It will be the government's responsibility to prove the defendant's guilt at trial.
Adams Produce CEO Sentenced to 16 Months in PrisonRead the Press Release
BIRMINGHAM – A federal judge late Tuesday sentenced the former CEO of Adams Produce Company to 16 months in prison for fraud against the company, failure to report a felony against the government and failure to file federal income tax returns, announced U.S. Attorney Joyce White Vance, FBI Special Agent in Charge Richard D. Schwein Jr. and IRS Criminal Investigation Special Agent in Charge Veronica Hyman-Pillot.
SCOTT DAVID GRINSTEAD, 45, chief executive officer of the now-defunct Adams Produce company, pleaded guilty to the charges in April. Grinstead agreed, as part of his plea agreement with the government, to pay $450,000 in restitution to the bankruptcy estate of Adams Produce to benefit the company's employees who lost pay when Adams closed abruptly and filed for bankruptcy in 2012. As part of Grinstead's sentence, U.S. District Judge Karon O. Bowdre ordered him to perform 20 hours of community service.
"This defendant, while CEO of Adams Produce, allowed officers and employees to continue cheating the government on contracts involving military bases and schools while, at the same time, he continued to steal from the company," Vance said. "Prison is deserved punishment for his criminal acts, which harmed the government and his company, but we also are pleased that resolution of this case will bring some compensation to the employees who lost their jobs and did not receive their final paychecks from Adams Produce," she said.
"Financial fraud at this company harmed employees, customers and U.S. taxpayers," Schwein said. "The FBI remains committed to investigating corporate fraud and seeing its perpetrators brought to justice."
"Individuals who earn income should accurately report their income to the IRS," Hyman-Pillot said. "The sentence today should reassure Americans that those individuals who willfully and intentionally violate their known legal duty of filing and paying their fair share of taxes will be prosecuted."
Three other officials of Adams Produce – David Andrew Kirkland, Christopher Alan Pfahl and Stanley Joel Butler II – have been charged and pleaded guilty, and another employee, Michael John O'Brian, was indicted in August in connection with fraud at the Birmingham-based company that had been a leading distributor of fresh fruits and vegetables across the Southeast for decades. Adams Produce was founded as a family-owned business more than 100 years ago. The family sold the company to executives and a private equity firm in 2010.
The federal government, through the Defense Supply Center Philadelphia, was one of Adams' customers. The supply center contracted with Adams Produce to provide fresh fruits and vegetables to military bases, public schools systems, junior colleges and universities. Adams Produce entered into contracts with the government worth millions of dollars, according to court records.
Kirkland, O'Brien, Butler and Pfahl conspired to create false records that reflected a higher purchasing cost for fruits and vegetables from a national distributor than Adams Produce actually paid. The inflated costs were presented to the government, which had agreed to pay a certain amount over Adams cost for produce.
Between Aug. 4, 2011, and Dec. 7, 2011, the Adams' employees and officers conspired to conduct at least 82 transactions with the national distributor that were designed to create false invoices and purchase orders. Through those false invoices submitted to the Defense Supply Center, Adams Produce fraudulently received about $481,000 from the government.
One of the charges Grinstead pleaded guilty to is misprision of a felony for knowing of the fraud that other officers were engaged in and allowing it to continue and end slowly, so as to avoid raising red flags with the government, rather than stopping it immediately and reporting it to authorities.
Grinstead pleaded guilty to wire fraud for wiring hundreds of thousands of dollars from an Adams Produce account to American Express to pay for clothing, jewelry, personal travel for himself and his family, lawn care at his home, and items for a house on Lake Martin.
He pleaded guilty to two counts of failure to file a federal tax return, one for 2009 and one for 2010. According to court records, Grinstead had a gross income of about $748,801 for the 2009 calendar year and willfully failed to file an income tax return with the Internal Revenue Service. In 2010, he received about $1,878,700 in gross income and willfully did not file a return with the IRS.
The FBI and the IRS investigated the case, and Assistant U.S. Attorney George A. Martin Jr. is prosecuting it.
Former Jacksonville State University Professor Sentenced for Attempting to Receive Child PornographyRead the Press Release
BIRMINGHAM – A federal judge today sentenced a former assistant professor at Jacksonville State University to five years in prison for attempting to receive child pornography, announced U.S. Attorney Joyce White Vance, Immigration and Customs Enforcement's Homeland Security Investigations Special Agent in Charge Raymond R. Parmer Jr. and Alabama Bureau of Investigation's Internet Crimes Against Children Task Force Commander Jeremy Lett.
U.S. District Judge L. Scott Coogler sentenced JONATHAN MARK HERBERT, 39, of Jacksonville, and ordered him to serve 10 years of supervised probation following his five years in prison. Herbert also must register as a sex offender. Herbert pleaded guilty in January to one count of attempting to receive child pornography. U.S. Marshals took him into custody following today's hearing.
According to court documents, Herbert attempted to receive images of child pornography over the Internet in August 2012 from a 14-year-old girl, who turned out to be an undercover police officer. He also drove to a Birmingham shopping center where he planned to meet the 14-year-old for sex.
The Alabama Department of Public Safety's Internet Crimes Against Children Task Force and HSI investigated the case, which Assistant U.S. Attorneys Joe Montminy and Daniel Fortune prosecuted.Talladega County Man Pleads Guilty to Murder for HireRead the Press Release
BIRMINGHAM -- A Talladega County man pleaded guilty today in federal court to attempting to hire a member of the Ku Klux Klan to murder an African-American neighbor he suspected of raping his wife, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.
ALLEN WAYNE DENSEN MORGAN, 29, of Munford, entered a guilty plea before U.S. District Judge Karon O. Bowdre to one count of using and causing someone else to use interstate facilities and travel -- a telephone and a motor vehicle -- with the intent to commit a murder-for hire. Morgan's sentencing is scheduled Feb. 27.
“The defendant attempted to arrange the brutal murder of his neighbor as vengeance for a perceived wrong,” said Jocelyn Samuels, Acting Assistant Attorney General for the Civil Rights Division of the Department of Justice. “The Justice Department will prosecute with vigor those who seek violent vigilantism.”
"This defendant’s effort to solicit a murder for hire is a federal crime," Vance said. "The prosecution here was swift and the punishment will be in a federal penitentiary. Future wrongdoers are on notice that we vigorously prosecute these crimes."
Federal officials arrested Morgan in August after he told FBI agents posing as members of the KKK that he would pay them to murder his neighbor. Morgan admitted he offered a watch, a necklace and a gun as payment for the murder and gave explicit details for the man's torture and murder.
Morgan's efforts to arrange the paid murder of his neighbor unfolded as follows, according to his plea:
Morgan talked to an undercover FBI agent by telephone on Aug. 22, who identified himself as a KKK member. The men arranged to meet three days later at an Oxford motel to discuss payment for the murder. In that phone conversation, Morgan used a racial slur to describe the man he wanted killed and bragged that he had just fired several shots toward the man to intimidate him. Morgan also described, in detail, how he wanted the man "hung from a tree like a deer and gutted," to have body parts cut off, and to "die a slow, painful death."
Morgan faces a maximum penalty of 10 years in prison and a $250,000 fine.
The FBI investigated the case. Assistant U.S. Attorneys Pat Meadows and John B. Felton of the Northern District of Alabama and Civil Rights Division Trial Attorney David Reese are prosecuting the case.
State Leaders Discuss Prisoner Reentry and Growing Prison CostsNeighbor-states' Successes in Reducing Crime and Recidivism ReviewedRead the Press Release
BIRMINGHAM – Alabama state leaders from all three branches of government came together at the Smart on Crime Reentry Policy Summit this week to discuss the urgent need to control prison crowding, corrections spending, and recidivism rates.
Each year, Alabama invests nearly $500 million to operate its prison system. Even with this investment, more than 40 percent of Alabama's prisoners are repeat offenders. This summit represented a key first step in bringing together stakeholders from across the state to discuss strategies for addressing these challenges.
"Prison overcrowding is a major concern, and we are working to identify innovative solutions," Gov. Robert Bentley said. "Wednesday's summit was a good opportunity to discuss how Alabama can explore a variety of options on how to be smart on crime while also protecting public safety. The Department of Corrections is doing a good job with the resources available, and we are working together to address this issue in a comprehensive manner."
State leaders from North Carolina, Texas, and Georgia joined experts from around the country in Birmingham to participate in the summit and discuss how an approach called Justice Reinvestment worked in their states to improve public safety, reduce corrections and related criminal justice spending, and reinvest savings in strategies that can decrease crime and strengthen neighborhoods.All three states enacted policies to improve the quality of supervision and treatment for individuals on probation and parole, and have seen outcomes improve and costs fall as a result. Forum participants then broke into smaller panels to discuss how those strategies might be applied in Alabama.
"Successful reentry programs help those who have served their time in prison develop into law-abiding citizens," said U.S. Attorney Joyce White Vance. "These programs reduce crime and the amount of taxpayer money that must be spent on prisons. I'm grateful for the strong leadership shown by our governor, legislators and judges, and their willingness to explore evidence-based, data-driven policies used so successfully by our neighbors in Texas, North Carolina and Georgia to reduce crime and control cost," she said.
"The course correction we need in our criminal justice system won't happen overnight," Alabama Corrections Commissioner Kim Thomas said. "Large-scale reentry programs must be addressed by a broad group of criminal justice stakeholders and include more than just the prison commissioner tweaking policies. We need to establish proven reentry models to break the cycle of crime and incarceration, making our communities safer, and wisely investing the taxpayer dollars."
Alabama Sen. Cam Ward emphasized the need for immediate action. "We cannot afford to wait any longer to address prison crowding, corrections spending and recidivism, especially when we've seen other states succeed in similar efforts. I hope my colleagues will join me in an effort to craft policy solutions to ensure our corrections resources have the greatest public safety impact possible," he said.Tuscaloosa County Man Indicted for Financial FraudRead the Press Release
BIRMINGHAM -- A federal grand jury has indicted a Tuscaloosa County man on multiple fraud and false statement charges connected to schemes to defraud financial institutions and the United States Small Business Administration of approximately $3 million, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.
A 51 count indictment filed in U.S. District Court charges DANNY RAY BUTLER, 57, of Fosters, Alabama, with wire fraud and multiple counts of false statements and bank fraud arising from three fraud schemes.
Butler owned and operated Butler Wholesale, Inc., a used car lot in Tuscaloosa, and Fosters Groceries, LLC, a company formed to build and operate a grocery store in Fosters. According to the Indictment, Butler defrauded the United States Small Business Administration (SBA) of $1,760,000 in connection with a loan to build Fosters Groceries, he engaged in a check kite scheme that caused Alabama One Credit Union to lose $1,275,000, and he made misrepresentations to Butler Wholesale’s floor plan company and caused a loss of $50,000.
The SBA is an agency of the federal government created to aid, counsel, assist, and protect the interests of small businesses. Through partnerships with public and private organizations, SBA helps Americans start, build, and grow small businesses. One of the ways in which SBA helps small businesses is through the SBA 504 Loan Program.In early 2010, Butler sought to borrow approximately $5 million from West Alabama Bank and Trust to build a grocery store in Fosters, Alabama. Subsequently, when West Alabama Bank and Trust refused to finance the entire project, Butler applied for and obtained an SBA 504 loan. West Alabama Bank and Trust ultimately agreed to loan Butler 50% of the total amount of the project and SBA agreed to finance 35% of the total amount. Butler was required to provide the remaining 15% as his cash injection into the project. Almost immediately after construction was complete, Butler defaulted on the loans by failing to make payments to SBA and West Alabama Bank and Trust as promised. SBA suffered a loss of over $1.7 million.
According to the Indictment, between March 2010 and October 2012, Butler devised and intended to devise a scheme and artifice to defraud SBA and to obtain money and property belonging to SBA by means of materially false and fraudulent pretenses, representations, and promises. It was a part of the scheme and artifice that Butler would and did submit false, forged, and altered documents to SBA in an effort to obtain an SBA 504 loan and receive over $1.7 million from SBA. Those false documents and representations included false, forged, and altered proposals, quotes, estimates, and bids submitted to SBA as evidence of the project’s cost, false, forged, and altered checks submitted to SBA as evidence of Butler’s cash injection, and false certifications on loan application forms that all information in the applications was true and complete. For instance, one count of the Indictment alleges that Butler submitted a construction company's cost proposal for the grocery store project that Butler is charged with altering to increase the proposed cost from $2.3 million to $4.2 million. Other counts detail further false documents that Butler submitted to SBA.
The indictment also contains multiple bank fraud counts charging Butler with a check-kiting scheme in 2011 and 2012 in which he carefully timed deposits and checks between his Fosters Groceries account at West Alabama Bank and Trust and his Butler Wholesale account at Alabama One Credit Union to artificially inflate the account balances. Hundreds of checks, totaling about $45 million, were deposited from one account to the other at the two financial institutions, according to the indictment. When West Alabama bank discovered the check-kiting scheme in February 2012 and refused to honor a number of Fosters Groceries' checks deposited into Butler's Alabama One Credit Union account, the credit union lost about $1.275 million, according to the indictment.
The third fraud scheme alleged in the indictment involves Butler's misrepresentations to the company that provided financing for his inventory at Butler Wholesale. Butler received loans from Next Gear Capital to buy inventory for his car lot. Each loan from Next Gear was secured by a specific car, and Next Gear conducted monthly inspections of the dealership's inventory. According to the indictment, Butler employed various schemes to defraud Next Gear Capital in order to continue receiving loans. His fraudulent representations included representing that cars were part of the dealership's inventory even though the cars had already had been sold, and lying to representatives of Next Gear when they conducted inspections of his inventory. Butler’s scheme caused Next Gear Capital a loss of at least $50,000.
Butler faces maximum penalties of 20 years imprisonment and a $250,000 fine on each of the 3 wire fraud counts, 30 years imprisonment and a fine of $1 million on each of the 30 bank fraud counts, and 5 years imprisonment and a $250,000 fine on each the 18 false statement counts.
The indictment also seeks to have Butler forfeit $3,085,000 as proceeds of his fraudulent schemes.
The FBI and SBA-OIG investigated the case and Assistant U.S. Attorney George A. Martin Jr. is prosecuting it.
The public is reminded that an indictment contains only charges and it will be the government's responsibility to prove the defendant's guilt beyond a reasonable doubt at trial.
Former Attorney Indicted for Securities and Bank FraudRead the Press Release
BIRMINGHAM -- A federal grand jury today indicted a former attorney in connection with a wire, mail and securities fraud scheme involving the fraudulent taking of more than $2.8 million dollars in investment funds, announced U.S. Attorney Joyce White Vance, FBI Special Agent in Charge Richard D. Schwein Jr. and Alabama Securities Commission Director Joseph Borg.
A 21-count indictment filed in U.S. District Court charges CHRISTOPHER SHAWN LINTON, 34, of Alabaster, with the securities fraud scheme and with bank fraud arising out of the submission of a fraudulent commercial loan application to Iberia Bank for a loan of $908,650.
According to the indictment, the securities fraud scheme unfolded as follows:
In 2007, Linton became an officer, partner and part owner of a business known as Integrity Capital Inc., by purchasing stock in the company. Integrity Capital Inc. was a factoring business located in the greater Birmingham area. Its business was to make advance payments to lawyers who had submitted payment vouchers for work performed for the State of Alabama. Integrity Capital would then receive the voucher payments from the state and keep a percentage as a fee.
In 2009, Linton formed Integrity Capital LLC. Beginning about August 2009, Linton recruited investment advisors to solicit investments in Integrity Capital LLC in order to purchase the assets and capital stock of Integrity Capital Inc. Between September 2009 and December 2011, a total of 12 individuals invested more than $2.8 million in Integrity Capital LLC. The investors mailed, wired or delivered money to Linton and the funds were deposited into one of several bank accounts held by the law firm where Linton worked as an attorney. After receiving the investor funds, Linton fraudulently converted them for personal use by writing personal checks to himself and by using the funds for non-investment purposes. The non-investment purposes, included, but were not limited to, the purchase of his personal residence, construction projects at the residence, private jet flights, vacations, recreational vehicles, furniture, luxury items, Auburn football tickets and a donation to the Heisman Trophy Trust.
The maximum penalty for each wire fraud charge is 20 years in prison and a $250,000 fine, the maximum penalty for each mail fraud charge is 20 years in prison and a $250,000 fine, the maximum penalty for money laundering is 10 years in prison and a $250,000 fine, the maximum penalty for each securities fraud charge is 5 years in prison and a $250,000 fine, and the maximum penalty for bank fraud is 30 years in prison and a $1,000,000 fine.
The FBI and Alabama Securities Commission investigated the case, which Assistant U.S. Attorney Robin Beardsley Mark is prosecuting along with Greg Biggs Associate Counsel with Alabama Securities Commission.The public is reminded that an indictment contains only charges and it will be the government's responsibility to prove the defendant's guilt beyond a reasonable doubt at trial.
Sovereign Citizens Member Sentenced to Two Years in Prison for Mailing Fictitious Financial InstrumentRead the Press Release
BIRMINGHAM – A federal judge today sentenced a Pinson man and member of an anti-government Sovereign Citizens group for mailing a fictitious financial instrument to pay off his home mortgage, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.
U.S. District Judge Inge P. Johnson sentenced DONALD JOE BARBER, 64, for mailing a fictitious “bonded promissory note” to his mortgage servicing company on March 10, 2008, in a fraudulent effort to satisfy his mortgage. Barber presented the fraudulent $10 million note as if it were a valid financial instrument drawn on a secret U.S. government account. A federal jury convicted Barber on the fraud charge in April.
During today's hearing, Barber began reading a letter that his attorney had to complete for him when he was unable to continue, in which Barber told the court that he would stop promoting the beliefs of the Sovereign Citizen movement.
Judge Johnson ordered Barber to serve his two-year federal prison sentence after completing sentences he has in state court. Barber will remain on supervised release for two years following completion of his federal prison sentence.
"Members of the Sovereign Citizen movement embrace an unfounded, mythological history of the United States to claim that they live outside the authority of government and its laws," Vance said. "Standing on that twisted premise, they break the law using fraudulent financial instruments and false court claims to advance an agenda of domestic terrorism," she said.
"Mr. Barber attempted to use a redemption scheme to avoid paying just debts, and today he pays for those crimes. All citizens should be wary of individuals or groups, such as 'sovereign citizens', that claim they can inform you on secret bank accounts, and should report that activity to the FBI."The FBI describes members of the sovereign citizen movement in the U.S. as U.S. citizens who openly reject their citizenship status and claim to exist beyond the realm of government authority. Affiliates may use their self-appointed status to justify threats, violence or crime, including theft and fraud.
The FBI investigated the case, which Assistant U.S. Attorney Michael W. Whisonant Sr. prosecuted.