Eastern District of California
Press releases recorded for this federal judicial district.
Loomis Man Sentenced to 6.5 Years in Prison for Tax Refund Fraud SchemeRead the Press Release
SACRAMENTO, Calif. — Petr Kuzmenko, 38, of Loomis, was sentenced today by U.S. District Judge Garland E. Burrell Jr. to six and a half years in prison and ordered to pay $573,332 in restitution to the IRS for conspiracy to defraud the United States, U.S. Attorney Phillip A. Talbert announced.
According to court documents, Kuzmenko was engaged in a tax fraud scheme with four co-defendants, including his brother, who worked as a tax preparer at VK Tax Services in Citrus Heights in 2009. Between February 2009 and November 2009, Kuzmenko conspired with others to file approximately 90 fraudulent tax returns with the IRS. The tax returns fraudulently claimed the First-Time Homebuyer Credit, which was worth as much as $7,500. The refunds for the fraudulent claims were electronically deposited into various bank accounts controlled by Kuzmenko and his co-defendants. The fraudulent claims totaled approximately $695,724, of which the IRS paid approximately $573,000.
“We want everyone who files a tax return to take advantage of the deductions and credits to which they are entitled by law,” said Michael T. Batdorf, Special Agent in Charge, IRS Criminal Investigation. “However, no one is entitled to defraud the government. Today’s sentencing sends a clear message to those who not only intentionally undermine our tax system, but help others so as well: You will not go undetected, and you will be held accountable.”
Kuzmenko was previously convicted in two mortgage fraud cases in this district and sentenced to a total of 21 years in prison for both cases. The sentence imposed in this case was ordered to run concurrent to those sentences.
This case is the product of an investigation by the IRS Criminal Investigation. Assistant United States Attorney Michele Beckwith is prosecuting the case.
Co-defendant Aleksandr Kuzmenko was sentenced to over two years in prison on October 28, 2016. Valeriy Nikitchuk pleaded guilty to conspiring to defraud the United States and is scheduled to be sentenced on December 16, 2016. Co-defendant Arsen Muhtarov has entered a plea of not guilty. The charges against him are only allegations, and he is presumed innocent until and unless proven guilty beyond a reasonable doubt.
El Dorado Hills Woman Sentenced to 3.5 Years in Prison for Tax Refund Scheme Involving More than $1.8 Million in Illegitimate RefundsRead the Press Release
SACRAMENTO, Calif. — U.S. District Judge Garland E. Burrell Jr. sentenced Barbara Antonucci, an unlicensed tax preparer, today to three years and six months in prison and ordered to pay $1,895,833 in restitution for conspiring to file false claims and filing false claims, United States Attorney Phillip A. Talbert announced.
According to court documents, Antonucci and her co-conspirator, Sherry Taggart, 56, of El Dorado Hills, prepared tax returns for clients seeking to maximize their refunds from the Internal Revenue Service. In 2008, Antonucci began a scheme to obtain false refunds by preparing and filing false claims on behalf of clients with the IRS. After May 2010, Taggart joined Antonucci’s scheme and together the two conspired to prepare and file hundreds of false claims with the IRS between June 2012 and March 2014, seeking refunds totaling approximately $1.4 million. As a result of the conspiracy, the IRS issued more than $757,000 in illegitimate refunds. In total, including the period in which Antonucci operated the scheme by herself, the IRS issued more than $1.8 million in illegitimate refunds from more than $2.5 million illegitimate claims filed during the scheme. On August 19, 2016, Antonucci pleaded guilty to conspiracy to file false claims and filing false claims.
The fraudulent returns Taggart and Antonucci prepared and caused to be filed reported false wages and dependents for their clients and, in many cases, qualified the clients for the refundable Earned Income Credit (EIC) when the client’s true wages or family situation would have qualified the client for no credit or a lower credit. Most of the fraudulent returns listed wages associated with self-employment not documented by a Form W-2, such as “housekeeper.” The defendants obtained the names, social security numbers, and other personal identifying information of minors and falsely listed those minors as dependents on tax returns for clients who were unrelated to those minors. Taggart and Antonucci also filed false claims on their own behalf. They filed the false federal tax returns with the IRS through the mail and via the internet from Sacramento, Yuba and Placer Counties.
“As we approach tax filing season next month it is important that this sentence represents adverse consequences for those tax return preparers who file false tax returns for their clients,” said Michael T. Batdorf, Special Agent in Charge, IRS Criminal Investigation. “It is important for tax return preparers to follow the law and guidance set forth by IRS on preparing tax returns. It is also very important for taxpayers to review their tax return with their tax return preparer to verify it has been prepared correctly before it is filed with the IRS and ask questions when they do not understand what has been prepared.”
San Francisco Division Inspector in Charge Rafael Nunez of the U.S. Postal Inspection Service stated, “We are working closely with the U.S. Attorney’s Office and our partners in law enforcement to arrest and prosecute those responsible for complex Identity Fraud Schemes and to protect the public and their personal information from theft.”
Antonucci was ordered to surrender to begin serving her sentence on February 17, 2017. Taggart is scheduled to be sentenced on December 9, 2016.
This case is the product of an investigation by the Internal Revenue Service‑Criminal Investigation, the United States Postal Inspection Service, and the Sacramento County Sheriff’s Office. Assistant United States Attorney André M. Espinosa is prosecuting the case.
Two Fresno Residents Sentenced for Manufacturing and Selling Fraudulent Identification DocumentsRead the Press Release
FRESNO, Calif. — Francisco Javier Hidalgo-Flores, 25, of Fresno, was sentenced today by Chief United States District Judge Lawrence J. O’Neill to 15 months in prison for conspiracy to produce and sell false identification documents, U.S. Attorney Phillip A. Talbert announced. Co-defendant Lizet Amairani Ramirez-Zazueta, 26, also of Fresno, was sentenced to time served for selling false identification documents. Both defendants have been in custody since their arrest on June 16, 2016.
According to court documents, Hidalgo-Flores manufactured fraudulent identification documents, including social security cards and alien registration receipt cards, for customers who placed orders and paid as much as $150 for a set of the fraudulent documents. Hidalgo-Flores and Ramirez-Zazueta also delivered fraudulent identification documents to customers and other co-conspirators.
This case was the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and the California Department of Motor Vehicles, Investigations Division. Assistant United States Attorney Christopher D. Baker is prosecuting the case.
“Counterfeit document traffickers will provide anyone with false documents for the right price,” said Ryan L. Spradlin, special agent in charge of HSI San Francisco. “This poses a potential national security threat and opens the door for imposters to steal identities and wreak havoc on innocent victims” lives.”
On June 16, 2016, Hidalgo-Flores and Ramirez-Zazueta were arrested along with four other co-defendants for the scheme. Co-defendant Veronica Rosales-Capitaine is scheduled to be sentenced on December 19, 2016; charges are pending against the remaining co-defendants. The pending charges are only allegations; the remaining co‑defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
Stockton Man Sentenced to 21 Months in Prison for Staging Car Accidents in a Scheme to Defraud Insurance CompaniesRead the Press Release
FRESNO, Calif. — Cristopher Santiago Sanchez-Becerra, 32, of Stockton, was sentenced today to 21 months in prison in connection with his role in a conspiracy to stage car accidents in order to defraud insurance companies, U.S. Attorney Phillip A. Talbert announced.
According to court documents, from October 2011 until August 2014, Sanchez-Becerra conspired with at least six other individuals to stage dozens of car accidents and submit false claims seeking compensation for the damage caused by the staged accidents. As part of the scheme, the defendants would often offer to repair the recruited individual’s vehicle at automobile repair shops that Sanchez-Becerra or a co-defendant owned, usually with less-than-complete repair work, and for a fee that was less than the payment from the insurance company. In all, Sanchez-Becerra caused at least $210,000 in false insurance claims to be paid as a result of the conspiracy to defraud.
In each staged accident, Sanchez-Becerra and other defendants utilized two or three vehicles and caused about $5,000 to $10,000 in damage to each vehicle. After each staged collision, the defendants submitted cover stories to the insurer that concealed the true cause of the accident. The cover story would commonly use aliases, false identities, and false addresses when describing the defendants. The defendants also used different vehicles in the staged collisions. They were able to do this by obtaining many different vehicles and using false identities to both register the vehicles with the Department of Motor Vehicles and obtain insurance policies for the vehicles. The defendants did this to avoid scrutiny by the insurer that reviewed the false claims. The defendants repeated the scheme in dozens of crashes by recruiting other individuals to participate in the staged collisions. These individuals would allow their vehicles to be damaged and would submit their own claim for damages. In many instances, false claims were submitted to the recruited individual’s insurance company.
This case is the product of an investigation by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and the California Department of Insurance, Fraud Division. Assistant United States Attorneys Patrick R. Delahunty and Henry Z. Carbajal III are prosecuting the case.
Co-defendants Victor Hugo Soriano-Villafan, 26, of Modesto, and Alfonso Apu, 47, of Modesto, have pleaded guilty and are awaiting sentencing. Charges are pending against co‑defendants Juan Ortiz Rivas, 39, of Ceres; Oscar Diaz Landa, 46, of San Jose; Liobigildo Vargas, 46, of Turlock; and Juan Marquez Cadenas, 30, of Patterson. The charges against them are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
Sacramento Landlord Pays $75,000 to Settle “Section 8” False Claims Act AllegationsRead the Press Release
SACRAMENTO, Calif. — United States Attorney Phillip A. Talbert announced today the resolution of federal False Claims Act allegations against Leatha Henderson for allegedly submitting false claims in connection with her participation as a landlord in the federal housing subsidy program.
The Housing Choice Voucher Program was enacted to assist low-income families in obtaining decent, safe, sanitary and affordable housing. The United States Department of Housing and Urban Development (HUD) administers the program through annual contribution contracts with local public housing agencies such as the Sacramento Housing & Redevelopment Agency (SHRA). This program is more commonly known as “Section 8.” Regulations implementing the Section 8 program provide that participating low-income tenants pay 30 to 40 percent of their adjusted monthly income toward their rent and utilities, and the federally funded program pays the balance.
Henderson contracted with SHRA in order to participate in the Section 8 program and receive government payments for her Sacramento rental property between June 2007 and May 2013. Under the terms of this Housing Assistance Payment Contract (HAP Contract), the United States paid between 62 and 68 percent of the rental rate stated in the HAP Contract (Federal Share), and the tenant paid the remaining 32 to 38 percent (Tenant Share). The HAP Contract restricted Henderson from charging rent to the tenant in excess of the Tenant Share as designated by SHRA based on the tenant’s income. Today’s settlement resolves allegations that Henderson falsely certified compliance with this rental payment restriction and fraudulently collected rental payments from both the United States and the tenant during the term of the tenancy.
“Charging in excess of the agreed tenant rate frustrates a primary goal of this important program: to provide affordable housing to low-income families,” said United States Attorney Talbert. “Landlords participating in the Section 8 program will be strictly held to their obligations under the governing regulations.”
“A landlord’s participation in the Section 8 program is voluntary,” said HUD Regional Administrator Jon Gresley. “When they choose to participate, they agree to fulfill certain responsibilities, including charging tenants no more than what they must pay in rent so that their homes remain affordable. HUD will continue upholding this standard, as it safeguards the program’s integrity and secures the public’s trust.”
The allegations resolved by the settlement were first raised in a lawsuit filed against Henderson under the qui tam, or whistleblower, provisions of the False Claims Act by Sondra Madden, the tenant involved in the subject Section 8 tenancy. The False Claims Act allows private citizens with knowledge of fraud to bring civil actions on behalf of the government and to share in any recovery. The whistleblower in this matter will receive approximately $13,500 of the recovery.
This case was the product of an investigation by HUD’s Office of Inspector General. Assistant United States Attorney Catherine J. Swann handled the case with the assistance of Ji Yoo, an attorney with HUD’s Office of General Counsel. The claims settled by this agreement are allegations only, and there has been no determination of liability.
“Dino the Casino” of Los Angeles Indicted for Statewide Illegal Gambling Business, Money Laundering, and Cocaine DistributionRead the Press Release
SACRAMENTO, Calif. — A federal grand jury returned a 12-count indictment Thursday against Nive Hagay, 31, of Los Angeles, charging him with operating an illegal gambling business, money laundering, and cocaine distribution, Acting United States Attorney Phillip A. Talbert announced.
According to court documents, between approximately July 2011 and November 2016, Hagay, who also went by the name “Dino the Casino,” placed video slot machines in small businesses from Bakersfield to Sacramento. These machines allegedly generated an estimated $1.9 million in cash per year, in violation of California state law. Hagay then laundered proceeds from the illegal gambling business through clothing companies in Los Angeles, as well as by making large purchases with the cash proceeds, such as a $202,000 cash transaction for a 2014 Audi R8. Finally, Hagay is charged with distributing a substance testing positive for cocaine.
This case is the product of an investigation by the Federal Bureau of Investigation and the California Department of Justice – Bureau of Gambling Control. Assistant United States Attorney Matthew M. Yelovich is prosecuting the case.
If convicted, Hagay faces a maximum statutory penalty of five years in prison and a $250,000 fine for the gambling charge; 10 years in prison and a $250,000 fine or fine of twice the value of the property involved in the transaction for one of the money laundering charges; 20 years in prison and a $500,000 fine or a fine of twice the value of the property involved in the transaction for the remaining money laundering charges; and 20 years in prison and a $1 million fine for the cocaine distribution charge. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Stockton Loan Officer Sentenced for Mortgage FraudRead the Press Release
SACRAMENTO, Calif. —Mark F. Friend, 62, of Stockton, was sentenced today by U.S. District Judge Garland E. Burrell Jr. to two years and four months in prison and ordered to pay $1,889,379 in restitution for conspiracy to commit bank fraud in relation to a mortgage fraud scheme, Acting U.S. Attorney Phillip A. Talbert announced.
According to court documents, between September 2006 and March 2007, while working for National City Mortgage, then a division of National City Bank, in Stockton, Friend arranged loans for borrowers that contained numerous falsehoods. He submitted false loan applications and other documents, and he made down payments on behalf of borrowers who did not have enough money, and then was repaid out of escrow after the loans were funded. The borrowers eventually stopped making payments on the loans, and National City Bank and other entities sustained losses amounting to $1,889,379.
Judge Burrell ordered Friend to self-surrender and begin his incarceration on January 13, 2017.
This case was the product of an investigation by the Federal Bureau of Investigation. Assistant United States Attorney John K. Vincent prosecuted the case.
Sacramento Man Pleads Guilty to Sex Trafficking a MinorRead the Press Release
SACRAMENTO, Calif. — Zargham Bukhari, 22, of Sacramento, pleaded guilty today to sex trafficking of children, Acting United States Attorney Phillip A. Talbert announced.
According to court documents, between February and April of 2014, Bukhari transported a 14-year-old victim to various motels and other locations in and around Sacramento to have sex with men for money. Bukhari would then take the money from the victim. Bukhari also gave the victim methamphetamine while he trafficked her.
This case is the product of an investigation by the Federal Bureau of Investigation Child Exploitation Task Force, a multijurisdictional task force composed of representatives from the FBI and the Sacramento Police Department. Assistant United States Attorney Michele Beckwith is prosecuting the case.
Bukhari is scheduled to be sentenced by U.S. District Judge Garland E. Burrell Jr. on February 10, 2017. Bukhari faces a maximum statutory penalty of life years in prison and a $250,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about internet safety education.
Stockton Husband and Wife Indicted on Human Trafficking Charges Related to Forced Labor of Foreign Nationals Primarily from IndiaRead the Press Release
SACRAMENTO, Calif. — A federal grand jury returned a five-count indictment today against Satish Kartan, 43, and his wife, Sharmistha Barai, 38, of Stockton, charging them with conspiracy to commit forced labor and the commission of forced labor. In addition, Kartan was charged with fraud in foreign labor contracting, and Barai was charged with benefiting from forced labor.
Acting U.S. Attorney Phillip A. Talbert and Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division announced the indictment.
According to court documents, between February 21, 2014, and October 3, 2016, Kartan and Barai hired workers from overseas to perform domestic labor in their homes in Albuquerque, New Mexico; Stockton and elsewhere in the United States. In advertisements seeking workers on the internet and India-based newspapers, the defendants made false claims regarding the wages and the duties of employment. Once the workers arrived at the defendants’ residences, Kartan and Barai forced them to work 18 hours a day with limited rest and nourishment. The defendants did not pay wages and used force, physical restraint and coercive conduct to get the workers to perform the labor and services.
The indictment alleges that Kartan and Barai struck one worker on multiple occasions, including one incident where Kartan grabbed her hands and caused them to be burned over the flames of a gas stove. Moreover, the indictment alleges that the defendants failed to pay another worker and told her that they would call the police if she tried to leave. When she was ultimately able to arrange to be picked up from the defendants’ house, Kartan refused to provide her with the access code to the gated community so that her ride could enter.
On October 21, 2016, the defendants were arrested on a criminal complaint and were released on bond with special conditions that prohibit them from hiring any nonrelatives to perform domestic services or child care work for them, and prohibit them from directly or indirectly contacting any of their prior domestic workers. Kartan and Barai are scheduled to be arraigned on November 21, 2016.
If convicted, each defendant faces a maximum statutory penalty of 20 years in prison and a $250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
This case is the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the FBI, the State Department’s Diplomatic Security Service, and the Stockton Police Department. Special Assistant U.S. Attorney Josh Sigal and Assistant U.S. Attorney Nirav Desai are prosecuting the case, with the assistance of the Civil Rights Division’s Human Trafficking Prosecution Unit.
The Eastern District of California (Sacramento) is one of six districts designated through a competitive, nationwide selection process as a Phase II ACTeam, through the interagency ACTeam Initiative of the Departments of Justice, Homeland Security, and Labor. ACTeams focus on developing high-impact human trafficking investigations and prosecutions involving forced labor, international sex trafficking and sex trafficking by force, fraud or coercion through interagency collaboration among federal prosecutors and federal investigative agencies.
Rocklin Man Pleads Guilty to Large-Scale Mortgage Fraud SchemeRead the Press Release
SACRAMENTO, Calif. —Aleksandr Kovalev, 53, of Rocklin, pleaded guilty today to wire fraud involving financial institutions in connection with a mortgage fraud scheme involving the purchase of at least 31 properties, Acting U.S. Attorney Phillip A. Talbert announced.
According to court documents, Kovalev was in the business of developing, building and selling property in Sacramento, Fairfield and Stockton. As the real estate market began to weaken, Kovalev offered to make incentive payments to purchasers, through “down payment assistance” or by making other payments to the buyers to be used in whatever manner the buyers wanted. Most of the payments to the buyers were out of escrow and were often paid through intermediaries, originating in Kovalev’s bank account. These payments were not disclosed to the lenders, and had the effect of substantially reducing the actual sales price below that was represented to the lenders. At least 31 properties were involved in Kovalev’s mortgage fraud scheme with substantial losses to the lenders.
This case was the product of an investigation by the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigation. Assistant U.S. Attorney Todd A. Pickles is prosecuting the case.
To date, five co-defendants have pleaded guilty and have been sentenced: Jannice Riddick, 34, of Sacramento (two years and 11 months in prison); Florence Francisco, 65, of Houston, Texas (one year in prison); Adil Qayyum, 34, of Rosele, Illinois (three years of probation); Elsie Pamela Fuller, 41, of Richmond (one year and nine months in prison); and Leona Yeargin, 49, of San Pablo (18 months in prison). Charges are pending against co-defendant Arthur Menefee, 45, of Stockton.
Two other defendants were charged separately for their involvement in the scheme. Valeriy Vasilevitsky, charged in U.S. v. Vasilevitsky, 2:12-cr-344 KJM, and Ruth Willis, charged in U.S. v. Willis, 2:13-cr-228 MCE, have also pleaded guilty and await sentencing.
Kovalev is scheduled to be sentenced by U.S. District Judge Morrison C. England Jr. on February 9, 2017. Kovalev faces a maximum statutory penalty of 30 years in prison and a fine of $1 million or twice the gross loss or gain. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
California Husband and Wife Indicted on Human Trafficking Charges Related to Forced Labor of Foreign NationalsRead the Press Release
Satish Kartan, 43, and his wife, Sharmistha Barai, 38, of Stockton, California, were indicted by a grand jury today for forced labor and conspiracy to commit forced labor. Kartan was also charged with fraud in contacting foreign labor and Barai was also charged with benefiting from forced labor.
Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division, and Acting U.S. Attorney Phillip A. Talbert of the Eastern District of California announced the indictment.
According to court documents, between Feb. 21, 2014, and Oct. 3, 2016, Kartan and Barai hired workers from overseas to perform domestic labor in their homes in Albuquerque, New Mexico; Stockton and elsewhere in the United States. In advertisements seeking workers on the internet and India-based newspapers, the defendants made false claims regarding the wages and the duties of employment. Once the workers arrived at the defendants’ residences, Kartan and Barai forced them to work 18 hours a day with limited rest and nourishment. The defendants did not pay wages and used force, physical restraint and coercive conduct to get the workers to perform the labor and services.
The indictment alleges that Kartan and Barai struck one worker on multiple occasions, including one incident where Kartan grabbed her hands and caused them to be burned over the flames of a gas stove. Moreover, the indictment alleges that the defendants failed to pay another worker and told her that they would call the police if she tried to leave. When she was ultimately able to arrange to be picked up from the defendants’ house, Kartan refused to provide her with the access code to the gated community so that her ride could enter.
On Oct. 21, 2016, Kartan and Barai were arrested on a criminal complaint and were released on bond with special conditions that prohibit them from hiring any nonrelatives to perform domestic services or child care work for them. The defendants are also prohibited from directly or indirectly contacting any of their prior domestic workers. Kartan and Barai are scheduled to be arraigned on Nov. 21, 2016.
If convicted, each defendant faces a maximum sentence of 20 years in prison and a $250,000 fine. An indictment is merely an allegation and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
This case is the product of an investigation by the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, the FBI, the State Department’s Diplomatic Security Service and the Stockton Police Department. Special Assistant U.S. Attorney Josh Sigal and Assistant U.S. Attorney Nirav Desai of the Eastern District of California are prosecuting the case, with the assistance of the Civil Rights Division’s Human Trafficking Prosecution Unit.
Sacramento is one of six districts designated through a competitive, nationwide selection process as a Phase II Anti-Trafficking Coordination Team, through the interagency ACTeam Initiative of the Departments of Justice, Homeland Security and Labor. ACTeams focus on developing high-impact human trafficking investigations and prosecutions involving forced labor, international sex trafficking and sex trafficking by force, fraud or coercion through interagency collaboration among federal prosecutors and federal investigative agencies.
Kartan IndictmentSacramento Man Sentenced to 10 Years in Prison for Receipt of Child PornographyRead the Press Release
SACRAMENTO, Calif. — Albert Lee Mitchell, 69, of Sacramento, was sentenced today by U.S. District Judge Kimberly J. Mueller to 10 years in prison to be followed by a lifetime of supervised release, for receipt of child pornography, Acting U.S. Attorney Phillip A. Talbert announced.
A federal jury found Mitchell guilty after a five-day trial in June 2016. According to evidence presented at trial, on November 5, 2012, agents executed at a search warrant at Mitchell’s residence after they identified an IP address located there offering files of child pornography. At the time of the search, dozens of images of suspected child pornography were set to be downloaded from a file-sharing network on Mitchell’s computer. Mitchell admitted to ownership of the computer and to being its sole user. A forensic review of the computer and other devices found in Mitchell’s home office revealed a collection of thousands of depictions of child pornography.
Mitchell obstructed justice by lying under oath at trial and trying to blame a former friend for his crime. To bolster his defense, Mitchell testified about a computer password that he alleged his friend had stolen. Mitchell presented a defense suggesting that the password had then been found in a box containing his friend’s belongings.
“Not only did the defendant have no regard for his victims, but he also blatantly disrespected the judicial system. The sentence that was handed down was well deserved,” said Ryan L. Spradlin, special agent in charge of HSI San Francisco. “HSI continues to work diligently with our law enforcement partners to pursue sexual predators who take advantage of innocent children.”
At sentencing, Judge Mueller found that Mitchell committed a serious crime and compounded it by presenting a perjured defense at trial. She commented that Mitchell had a right to go to trial, but that he “didn’t have the right to obstruct justice,” which she noted was a “significant aggravating factor.” Judge Mueller also found that the images had been carefully catalogued and arranged, indicating an “obsessive interaction” with the images.
This case was the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI). Assistant U.S. Attorneys Audrey B. Hemesath and Josh F. Sigal prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about internet safety education.
Fresno County Felon Convicted of Illegal Possession of FirearmRead the Press Release
FRESNO, Calif. — Gary Lee Ortiz, 41, of Auberry, pleaded guilty today to being a felon in possession of a handgun with an obliterated serial number, Acting United States Attorney Phillip A. Talbert announced.
According to the plea agreement, Ortiz will pay restitution to the U.S. Forest Service for damaging public land and natural resources as a result of marijuana cultivation activities near his residence in the Mill Creek area.
According to court documents, on June 8, 2015, Ortiz possessed the firearm at his residence when law enforcement officers located a marijuana cultivation operation on Ortiz’s property and also on adjacent land in the Sierra National Forest. Law enforcement officers eradicated the plants and seized a total of four firearms. One of the firearms was a Herbert Schmidt, model E 15, .22 LR caliber revolver with the serial number obliterated. At the time, Ortiz was a convicted felon and prohibited from possessing a firearm.
Ortiz is scheduled for sentencing on March 6, 2017, by U.S. District Judge Lawrence J. O’Neil. He faces a maximum statutory penalty of 10 years in prison and a $250,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
This case is the product of an investigation by the U.S. Forest Service, the Bureau of Alcohol, Tobacco Firearms and Explosives, the California Department of Fish and Wildlife, the Fresno County Sheriff’s Office, and the Fresno County Probation Department. Assistant United States Attorney Karen Escobar is prosecuting the case.
Former Fresno Business CFO Sentenced to over 5 Years in Prison for Embezzlement and Money LaunderingRead the Press Release
Fresno, Calif. —Anthony Lester, 53, of Fresno, was sentenced today by U.S. District Judge Dale A. Drozd to five years and four months for mail fraud and money laundering in connection with his embezzlement of $306,000 from a Fresno business, Acting U.S. Attorney Phillip A. Talbert announced.
On August 19, 2016, after a four-day trial, a jury found Lester guilty on all seven counts charged in the indictment. According to evidence at trial, between August 2010 and January 2012, Lester embezzled and stole money from his former employer. While an employee at Century Builders and Highlands Energy Services, he held supervising positions in the accounting department, including Chief Financial Officer. In those capacities, Lester had responsibilities regarding management of the companies’ finances and financial transactions and had access to and control over some of the companies’ checking accounts and credit cards. Lester used this access to defraud the companies. He also attempted to frame his predecessor and other employees of the companies by falsely associating them with the PayPal accounts.
According to court documents, Lester transferred money from one of the companies’ checking accounts into what purported to be the companies’ PayPal account. Then he transferred the money to one of his own personal PayPal accounts. Additionally, he transferred money from two of the companies’ credit cards to his personal PayPal account. Thereafter, he attempted to launder the proceeds of his fraudulent scheme and conceal his embezzlement by transferring money from his personal PayPal account to his personal bank accounts. None of these transactions were authorized by the companies, and none were for legitimate business purposes of the companies. In total, Lester embezzled approximately $306,000 from his former employer.
“Financial crimes are a concern in every type and size of business, and sadly it often involves the most trusted individuals,” said Ryan L. Spradlin, special agent in charge of HSI San Francisco. “The crimes not only rob businesses of vital revenue, but they also undermine the trust of employees and customers alike.”
In addition to prison sentence, Lester was ordered to pay $306,319 in restitution to the companies.
This case was the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and the Fresno Police Department. Assistant United States Attorneys Patrick R. Delahunty and Patrick J. Suter prosecuted the case.
San Joaquin County Man Sentenced to 14 Years in Prison for Methamphetamine TraffickingRead the Press Release
SACRAMENTO, Calif. — Alejandro Munoz Galvan, 39, of Lathrop, was sentenced today by United States District Judge Troy L. Nunley to 14 years in prison for conspiracy to distribute and possess with intent to distribute methamphetamine, Acting United States Attorney Phillip A. Talbert announced.
According to court documents, between 2009 and March 2, 2012, Munoz Galvan was the leader of a group of individuals who distributed quarter-pound, half-pound and pound quantities of crystal methamphetamine in Solano County and elsewhere. Munoz Galvan received methamphetamine orders from smaller-scale drug traffickers and, to avoid personally possessing the drugs, employed multiple runners to deliver the drugs and stash house sitters to store the drugs. He hired lawyers for his runners and stash house sitters when they were arrested, so long as they refused to cooperate with law enforcement.
This case was the product of an investigation by the Federal Bureau of Investigation’s Violent Gang Task Force, the Drug Enforcement Administration, the Internal Revenue Service-Criminal Investigation, the police departments of Vacaville, Fairfield, Vallejo, Suisun City, Dixon, San Jose, and Manteca; the sheriff’s offices of Solano County and Nevada County, and the Solano County District Attorney’s Office of Investigations. Assistant U.S. Attorney Richard Bender prosecuted the case.
Co-defendants Alejandro Pantoja and Jose Miguel Cruz-Solario were each sentenced to seven years and three months in prison in 2015.
This case was the result of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation. The OCDETF Program was established in 1982 to conduct comprehensive, multilevel attacks on major drug trafficking and money laundering organizations. The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking and money laundering organizations and those primarily responsible for the nation’s drug supply.
“Coyote” Pleads Guilty to Conspiring to Defraud Immigrants Seeking to Enter the U.S. and Their Relatives in the United StatesRead the Press Release
FRESNO, Calif. — A man who previously posed as an immigrant smuggler (also known as a “coyote”) pleaded guilty today to a scheme to detain Mexican citizens seeking to enter the U.S. without documentation, and hold them in order to compel their relatives who were U.S. residents to pay money for their release, Acting United States Attorney Phillip A. Talbert announced.
Martin Carranza-Sanchez, 45, of Mexico, pleaded guilty today to conspiracy to commit wire fraud. According to his plea agreement, between January 2010 and January 21, 2016, Carranza-Sanchez posed as an undocumented‑immigrant smuggler who falsely promised undocumented immigrants and their U.S.‑resident relatives that that he would deliver the immigrants into the United States for a fee. Carranza-Sanchez directed the U.S. residents to wire the fee to various bank accounts in the Eastern District of California, which he and his co-conspirators ultimately collected.
According to court documents, in an effort to obtain payment, Carranza-Sanchez instructed the immigrants to go to a location in Mexico where his co-conspirators seized and detained them against their will. The co-conspirators telephoned the U.S. residents and told them that the immigrants would soon be delivered to the United States or that they had safely crossed the border, and instructed the U.S. residents to wire the payment. On multiple occasions, Carranza-Sanchez and his co-conspirators threatened to harm the immigrants unless the U.S. residents paid immediately.
According to the plea agreement, Carranza-Sanchez never intended to facilitate the undetected entry of these immigrants into the United States. In many instances, once the relatives wired the fee, Carranza-Sanchez instructed the immigrants to cross the border, and the immigrants were immediately apprehended by United States Border Patrol.
The investigation revealed that Carranza-Sanchez and his co-conspirators defrauded U.S. residents of approximately $95,000 as a result of their scheme. The plea agreement obligates him to repay that amount to the victims of his crimes.
This case is the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI). Assistant United States Attorney Angela L. Scott is prosecuting the case.
Carranza-Sanchez is scheduled to be sentenced by U.S. District Judge Dale A. Drozd on February 6, 2017, at 10:00 a.m. Carranza-Sanchez faces a maximum statutory penalty of 20 years in prison. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
Mammoth Lakes Doctor Sentenced to Probation for Removing Archeological ResourcesRead the Press Release
FRESNO, Calif. — Jonathan Cornelius Bourne, 59, of Mammoth Lakes, was sentenced Monday to two years of probation, a $40,000 fine, and $249,372 in restitution for felony violations of the Archeological Resources Protection Act, Acting U.S. Attorney Phillip A. Talbert announced. Additionally, Bourne is banned from entering federal public lands for recreational purposes while on probation.
On August 15, 2016, Bourne pleaded guilty to unauthorized transportation of archeological resources and unauthorized excavation, removal, damage, or defacement of archeological resources. According to court documents, Bourne had been collecting artifacts and archeological resources since 1994. He documented each item and has voluntarily turned over to the government an estimated 20,000 archeological items that he had collected from public lands.
According to the plea agreement, on October 14, 2010, Bourne altered a small prehistoric site, cremation site, and burial cairns in the Humboldt-Toiyabe National Forest in Nevada. He removed glass trade beads and transported them to his home in Mammoth Lakes. On January 10, 2011, Bourne altered a large prehistoric site in Death Valley National Park and removed a tool made from a bighorn sheep horn and three incised stone tablets, which were later found in Bourne’s home.
In sentencing Bourne, U.S. District Judge Lawrence J. O’Neill stated that the damage caused by Bourne could not be undone no matter what sentence was imposed. He further stated that this case highlighted the importance of educating others as to the significance of the sacred Native American cultural resources and the protection of the Native American cultural sites.
Death Valley National Park Superintendent Mike Reynolds said, “Death Valley is the homeland of the Timbisha Shoshone Tribe. Dr. Bourne didn't just steal their heritage; he stole from all Americans when he removed these artifacts from the park. I'm relieved that he has been sentenced and is paying restitution to help us curate the artifacts. I hope this will help deter other people from desecrating important cultural resources that help tell our nation's history. However, we've permanently lost information that could have been learned if the artifacts had never been moved.”
This case was the product of an investigation by the United States Forest Service, the National Park Service, and the Bureau of Land Management. Assistant United States Attorney Laurel J. Montoya prosecuted the case.
Kern County Man Sentenced to 15 Years in Prison for Receipt and Distribution of Child Pornography Relating to Online Sextortion SchemeRead the Press Release
FRESNO, Calif. — An Arvin man was sentenced today to 15 years in prison for child pornography offenses related to the online sextortion of female minors, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and Acting U.S. Attorney Phillip A. Talbert of the Eastern District of California.
Brian Caputo, 27, pleaded guilty to receipt and distribution of child pornography on May 16, 2016. U.S. District Judge Lawrence J. O'Neill sentenced Caputo and also ordered him to serve 15 years of supervised release.
According to admissions made in connection with his guilty plea, between December 2008 and February 2014, Caputo received on his cell phone and by email at least one image of a minor engaging in sexually explicit conduct and distributed one or more of such images to another minor in order to coerce the minor to produce additional child pornography.
The FBI investigated the case with assistance from the El Paso Police Department and the FBI’s Violent Crimes Against Children Task Force. Assistant U.S. Attorney Michael Tierney and former Trial Attorney Maureen C. Cain of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
California Man Sentenced to Life Plus 60 Years for 2013 Shooting Spree at Los Angeles International Airport and First-Degree Murder of Transportation Security Administration OfficerRead the Press Release
A Sun Valley, California, man was sentenced today to life plus 60 years in prison for a 2013 shooting at Los Angeles International Airport (LAX) in which he murdered a Transportation Security Administration (TSA) officer.
Attorney General Loretta E. Lynch, Secretary Jeh C. Johnson of the Department of Homeland Security, U.S. Attorney Eileen M. Decker of the Central District of California and Assistant Director in Charge Deirdre Fike of the FBI’s Los Angeles Field Office made the announcement.
Paul Anthony Ciancia, 26, pleaded guilty on Sept. 6, 2016, to one count of murder of a federal officer; two counts of attempted murder of a federal officer; four counts of violence at an international airport; one count of discharging of a firearm during a crime of violence causing death; and three counts of discharging a firearm during a crime of violence. U.S. District Judge Philip S. Gutierrez of the Central District of California imposed today’s sentence.
“Today, justice was done on behalf of fallen TSA Officer Gerardo Hernandez, his wounded colleagues and all those who were terrorized by the wanton violence perpetrated by this defendant,” said Attorney General Lynch. “This sentence reflects appropriate punishment for a heinous crime. It ensures that the defendant can never again harm or murder innocent Americans. And it sends a clear message that the Department of Justice will not tolerate calculated attacks on our nation’s law enforcement officers, and that those who do commit such crimes will be held accountable.”
“We are grateful to the FBI and the Department of Justice for their hard work in obtaining justice for Mr. Hernandez, his family, co-workers and the men and women of DHS,” said Secretary Johnson.
“The crimes that led to today’s sentence were vicious, horrific and senseless,” said U.S. Attorney Decker. “After planning a mass murder, this defendant murdered a highly respected law enforcement officer, seriously wounded two other federal officers and a civilian and terrified hundreds of people who feared for their lives. Those who target law enforcement and our nation's critical infrastructure will be held accountable. As a result of today’s sentence, Mr. Ciancia will never again have a chance to harm other innocent people.”
“The defendant will spend the rest of his life behind bars for targeting airport officers with premeditated murder, but a just sentence cannot replace the loss of Officer Hernandez, nor remove the suffering of his victims, and his victims' families, friends and colleagues,” said Assistant Director in Charge Fike. “The collaborative efforts by first responders and investigators on the day of the shooting and thoughout this investigation are commendable and aided prosecutors in ensuring that Mr. Ciancia can never again pose a threat.”
According to the plea agreement, in early 2013, Ciancia purchased a semiautomatic rifle, 500 rounds of ammunition and 10 magazines for the rifle. On the morning of Nov. 1, 2013, Ciancia modified two pieces of luggage and zip-tied them together to conceal his loaded rifle inside.
Ciancia admitted that later that morning, he entered LAX Terminal Three, removed the loaded rifle from his modified luggage and fired at and killed TSA Officer Gerardo Hernandez while he was checking passengers’ travel documents. Ciancia admitted that he then went upstairs to a TSA checkpoint, by which time many TSA officers and passengers had fled the airport. He fired his weapon at two TSA Officers as well as a civilian, he admitted, all of whom sustained serious injuries and required surgery but survived the attack. According to the plea agreement, as Ciancia passed passengers hiding in or fleeing the terminal during the attack, he asked if they were TSA and when they said no, he passed without shooting at them.
The Los Angeles Joint Terrorism Task Force (JTTF) investigated the case. The JTTF is led by the FBI and includes agents and officers from 45 other local, state and federal agencies.
The Los Angeles Airport Police; the Los Angeles Police Department; the Los Angeles County Sheriff's Department; TSA; the Federal Air Marshal Service; the Los Angeles Port Police; the Long Beach, California, Police Department; the Air Force Office of Special Investigations; the Bureau of Alcohol, Tobacco, Firearms and Explosives; U.S. Customs and Border Protection; the U.S. Secret Service; the Los Angeles Fire Department; Los Angeles International Airport Operations; the U.S. Marshals Service; the U.S. Postal Inspection Service; and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations provided substantial assistance in the investigation.
First Assistant U.S. Attorney Patrick R. Fitzgerald of the Central District of California, Assistant U.S. Attorney Melissa Mills of the Central District of California’s Terrorism and Export Crimes Section, Assistant U.S. Attorney Joanna M. Curtis of the Central District of California’s Violent and Organized Crime Section and Trial Attorney Michael S. Warbel of the Criminal Division’s Capital Case Section prosecuted the case.
California Man Sentenced to 180 Months in Prison for Receipt and Distribution of Child Pornography Relating to Online Sextortion SchemeRead the Press Release
An Arvin, California, man was sentenced today to 15 years in prison for child pornography offenses related to the online sextortion of female minors, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and Acting U.S. Attorney Phillip A. Talbert of the Eastern District of California.
Brian Caputo, 27, pleaded guilty to receipt and distribution of child pornography on May 16, 2016. U.S. District Court Judge Lawrence J. O’Neill of the Eastern District of California sentenced Caputo and also ordered him to serve 15 years of supervised release.
According to admissions made in connection with his guilty plea, between December 2008 and February 2014, Caputo received on his cell phone and by email at least one image of a minor engaging in sexually explicit conduct, and distributed one or more of such images to another minor in order to coerce the minor to produce additional child pornography.
The FBI investigated the case with assistance from the El Paso Police Department and the FBI’s Violent Crimes Against Children Task Force. Assistant U.S. Attorney Michael Tierney of the Eastern District of California and former Trial Attorney Maureen C. Cain of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Davis Property Manager Sentenced to over 4 Years in Prison for Stealing Tenants’ IdentitiesRead the Press Release
SACRAMENTO, Calif. — William R. Stanley Jr., 31, of Sacramento, was sentenced on Thursday by United States District Judge Morrison C. England Jr. to four years and three months in prison for access device fraud and aggravated identity theft, Acting United States Attorney Phillip A. Talbert announced.
San Francisco Division Inspector in Charge Rafael Nunez of the U.S. Postal Inspection Service stated: “Postal Inspectors worked closely with the U.S. Attorney’s Office and our partners in law enforcement to arrest and prosecute those individuals responsible for thefts of mail and Identity theft crimes committed against the public.”
According to court documents, from February 17, 2015, until February 17, 2016, Stanley lived at the Tuscany Villas Apartment Complex in Davis and worked as the on-site property manager there and at three additional apartment complexes that were managed by the same property management company. During this time, Stanley used a stolen identity and a fraudulent California DMV license bearing his image but the personal identifying information of another person. He was known to the property management company and to tenants and rental applicants under this false identity.
According to the plea agreement, Stanley obtained personal identifying information from tenants and rental applicants and used the information to add himself as a user on victims’ financial accounts and to open new accounts in their names, with himself as an authorized user. Stanley also defrauded an 82-year-old victim by taking his wallet after the victim left it at a grocery store, and he used the victim’s personal information to open lines of credit with himself as an authorized user. According to the factual basis in the plea agreement, Stanley caused $24,442 in loss to the victims.
In addition to the prison sentence, Stanley will be directed to pay restitution. The amount will be determined by the Court.
This case was the product of an investigation by the United States Postal Inspection Service and the Davis Police Department. Assistant United States Attorneys Matthew D. Segal and Owen Roth prosecuted the case.
Chico Man Sentenced to 17.5 Years in Prison for Child Pornography OffenseRead the Press Release
SACRAMENTO, Calif. — Frank W. Coon, 51, of Chico, was sentenced today by United States District Judge Garland E. Burrell Jr. to 17 years and six months in prison for receipt of child pornography, Acting United States Attorney Phillip A. Talbert announced.
A federal jury found Coon guilty of the charge on May 23, 2016, after a three‑day trial. After serving his prison sentence, Coon will be under supervision for an additional 20 years and will be required to register as a sex offender.
According to evidence presented at trial, when agents executed a search warrant in March 2012, they found Coon inside his apartment at the keyboard of a computer. That computer was later found to be filled with child pornography videos. It was ultimately determined that over the course of approximately seven months, Coon used peer-to-peer software to download 117 child pornography videos. Several videos involved the portrayal of sadistic, masochistic, and other depictions of violence, and included depictions of pre-pubescent minors.
“This defendant downloaded horrific sexual content involving small children for his own pleasure,” said Ryan L. Spradlin, special agent in charge of HSI San Francisco. “HSI will continue to work with our law enforcement partners to seek out these criminals and bring them to justice.”
At sentencing, Judge Burrell stated that Coon had committed perjury when he testified in his own trial and blamed others for his actions both before and during a law enforcement search of his home in 2012. Judge Burrell observed that 17 and a half years in prison is “a long time” and that the sentence was necessary in light of the facts that were presented at trial.
This case was the product of an investigation by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI). Assistant United States Attorneys Matthew G. Morris and Rosanne Rust prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc. Click on the “resources” tab for information about internet safety.
Multi-agency Operation in Fresno Results in 28 Arrests for Drug Trafficking and Firearm OffensesRead the Press Release
FRESNO, Calif. — Following a year-long investigation conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Federal Bureau of Investigation; the California Department of Justice’s Bureau of Investigation, Special Operations Unit; the Multi-Agency Gang Enforcement Consortium (MAGEC); and the Fresno Police Department, targeting local criminal street gangs in Fresno, 20 defendants were arrested today on federal charges and another eight defendants were arrested on state charges. The various charges include conspiracy to traffic illegally in firearms, illegal possession and sales of firearms, drug trafficking, and promoting prostitution.
Phillip A. Talbert Acting U.S. Attorney for the Eastern District of California; Jerry Dyer, Fresno Chief of Police; ATF Special Agent in Charge Jill Snyder; FBI Special Agent in Charge Monica M. Miller, and California Attorney General Kamala Harris made the announcement.
Acting U.S. Attorney Talbert stated: “The seven indictments and the arrests today are part of a strategic plan to maximize state and federal resources to reduce gun violence in Fresno and keep its streets safe.”
“Gangs cannot be allowed to operate with impunity, jeopardizing public safety and terrorizing communities in California," said California Attorney General Kamala D. Harris. "I thank our California Department of Justice Special Agents, as well as the Fresno Police Department, the Federal Bureau of Investigation, the Bureau of Alcohol, Tobacco, Firearms, and Explosives, and the California Highway Patrol for working diligently and collaboratively to keep our communities safe from violent crime.”
“Just as operation Dog Track served to dismantle the notorious Dog Pound gang, Operation Slide Lock will serve to cripple the Strother Boys gang,” said Chief Jerry Dyer. “I look forward to working with our local, state, and federal law-enforcement partners as we prepare to focus on the next targeted street gang.”
“Today’s arrests demonstrate the FBI’s commitment to helping make Fresno a safer place to live,” said FBI Special Agent in Charge Monica M. Miller. “The FBI will continue to work with its state, local and federal partners to aggressively pursue those who would traffic in illegal firearms in our neighborhoods.”
“Firearms trafficking is one of the most pressing issues today,” stated ATF Special Agent in Charge Jill Snyder. “At ATF, our highest priority is reducing violent crime within our communities. Firearms trafficking leads to guns getting into the hands of violent criminals, gangs, drug trafficking organizations and prohibited people. Operations, like the one conducted today, make our neighbors safer by stopping the drivers of violence in our communities. We would like to thank all of the agencies involved in this operation for their hard work and dedication that made today a success.”
The 17 federal defendants are charged as follows:
- Dejohn Wiley, 22, one count of conspiracy to engage in the business of dealing firearms without a license, one count of engaging in the business of dealing firearms without a license, two counts of possession of an unregistered firearm, 14 counts of being a felon in possession of a firearm, three counts of possession of a firearm in a school zone, and nine counts of distribution of methamphetamine;
- Chris Wiley, 24, one count of conspiracy to engage in the business of dealing firearms without a license, one count of being a felon in possession of a firearm, one count of possession of a firearm in a school zone, and two counts of distribution of methamphetamine;
- Anthony Latimore, 21, one count of conspiracy to engage in the business of dealing firearms without a license, one count of engaging in the business of dealing firearms without a license, four counts of being a felon in possession of a firearm, and one count of distribution of methamphetamine;
- Garry Sampson, 38, one count of conspiracy to engage in the business of dealing firearms without a license, one count of being a felon in possession of a firearm;
- Vonshay Robinson, 29, one count of conspiracy to engage in the business of dealing firearms without a license;
- Rashawn Alkobadi, 22, one count of conspiracy to engage in the business of dealing firearms without a license, one count of engaging in the business of dealing firearms without a license, five counts of possession of a firearm in a school zone, and two counts of distribution of methamphetamine;
- Federico Garcia, 24, one count of conspiracy to engage in the business of dealing firearms without a license, possession of a firearm in a school zone, and two counts of distribution of methamphetamine.
- Omar Gonzalez, 24, one count of possession with intent to distribute cocaine;
- Darien Hatcher, 26, one count of possession with intent to distribute cocaine;
- Charlie Stevenson, 31, one count of conspiracy to engage in the business of dealing firearms without a license, three counts of being a felon in possession of a firearm, and one count of possession with intent to distribute methamphetamine;
- Jamar Johnson, 21, one count of conspiracy to engage in the business of dealing firearms without a license, two counts of being a felon in possession of a firearm, and one count of use of a cellphone to promote prostitution;
- Khalif Campbell, 33, one count of conspiracy to distribute and possess with intent to distribute cocaine base;
- Raymond Jones, 60, one count of conspiracy to distribute and possess with intent to distribute cocaine base;
- Danny Valenzuela, 50, one count of conspiracy to distribute and possess with intent to distribute cocaine base;
- Anthony Thomas, 24, one count of being a felon in possession of a firearm;
- Devone Johnson, 30, one count of possession of a firearm after suffering a misdemeanor domestic violence conviction;
Dione Singleton, 39, one count of being a felon in possession of a firearm, one count of possession of a firearm in a school zone, and one count of distribution of cocaine base.
The following federal defendants were arrested today on criminal complaints: Stephen Hill, 26, and Rashad Halford, 29, are charged with using a cellphone to promote prostitution and using a cellphone to facilitate a drug trafficking offense. Jesus Velazquez, 23, is charged with conspiracy to engage in the business of dealing firearms without a license and possession of an unregistered firearm. Darien Hatcher and Charlie Stevenson who were indicted have also been charged by a criminal complaint along with Robert Gonzalez, 33, for conspiracy to distribute methamphetamine.
These federal cases are the product of an investigation by the ATF, the FBI, the Fresno Police Department, MAGEC, the California Department of Corrections and Rehabilitation, the Fresno County District Attorney’s Office, and the California Department of Justice, the California Highway Patrol Special Operations Unit (SOU). The Special Operations Unit (SOU) is a collaborative investigative effort between the California Department of Justice and the California Highway Patrol (CHP) that provides statewide enforcement for combating violent career criminals, gangs, and organized crime groups, along with intrastate drug traffickers.
Also assisting today was the Fresno County Sheriff’s Office, the Clovis Police Department, Fresno County Probation, and the California Highway Patrol.
Assistant U.S. Attorneys Kimberly A. Sanchez and Christopher D. Baker are prosecuting the cases.
If convicted the defendants face the following maximum sentences: five years in prison for conspiracy to engage in the business of dealing firearms without a license; five years in prison for engaging in the business of dealing firearms without a license; 10 years in prison for being a felon in possession of a firearm; 10 years in prison for possession of a firearm after suffering a misdemeanor domestic violence conviction; five years in prison for possession of a firearm in a school zone; 10 years in prison for possession of an unregistered firearm; 20 years to life in prison for conspiracy to distribute and possess with intent to distribute methamphetamine; 20 years to life in prison for distribution of methamphetamine; 20 years in prison for distribution of cocaine base; 20 years in prison for conspiracy to distribute and possess with intent to distribute cocaine base; 20 years in prison for possession with intent to distribute cocaine, and five years in prison for use of a cellphone to promote prostitution.
Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
Executive Director of Fairfield Non-profit Charged with Embezzling DOJ Funds Intended for Domestic Violence VictimsRead the Press Release
SACRAMENTO, Calif. — A federal grand jury returned a 16-count indictment today against Claudia Humphrey, 60, of American Canyon, charging her with theft of public money, obstruction of a federal audit, and falsifying records in a federal investigation, Acting United States Attorney Phillip A. Talbert announced.
According to court documents, Humphrey was the executive director of LIFT3 Support Group Inc., a non-profit organization in Fairfield that offered transitional shelter assistance and other services to victims of sexual assault, domestic violence, and dating violence, primarily serving residents in Solano County. Humphrey, through LIFT3, sought and received federal grants from the Department of Justice, Office on Violence Against Women (OVW) in 2011 and 2012. Humphrey caused to be transferred over $270,000 in grant money that were to be used only for assisting victims of domestic violence into bank accounts that she controlled. Humphrey used over $50,000 of those victim funds on personal expenses such as travel, shopping, and payments to her family members, among other things.
According to court documents, between October 2014 and August 2015, in an effort to conceal her embezzlement of federal funds, Humphrey obstructed the efforts of the OVW audit of LIFT3. Humphrey falsified purchase documents showing that computers were purchased, and altered and falsified expense ledgers and time sheets.
This case is the product of an investigation by the Department of Justice Office of the Inspector General. Assistant United States Attorney Todd A. Pickles is prosecuting the case.
If convicted, Humphrey faces a maximum statutory penalty of 10 years in prison on each of the counts of theft of public money, five years in prison for obstruction of a federal audit, and 20 years in prison on each of the counts of falsifying a record in a federal investigation. Additionally, Humphrey faces a fine of $250,000 or twice the gross loss or gain. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
City of Fairfield and the Fairfield Housing Authority Pay $680,000 to Settle False Claims Act AllegationsRead the Press Release
SACRAMENTO, Calif. — The City of Fairfield and the Fairfield Housing Authority (FHA) paid $680,000 to settle federal False Claims Act allegations that they received grants to fund two coordinator positions for a federal housing program but did not use the funds for that purpose, Acting United States Attorney Phillip A. Talbert announced today.
The FHA administers the Section 8 Housing Choice Voucher Program (HCV), the HCV Homeownership Program, and the Family Self-Sufficiency Program (FSS) for the City of Fairfield. Section 8 of the federal Housing Act of 1937 authorizes the payment of rental housing assistance to private landlords on behalf of low-income households. The HCV Program is the federal government’s major program for assisting very low-income families, the elderly, and the disabled to afford decent, safe, and sanitary housing in the private market. The FSS Program provides case management for Section 8 families who desire to improve their earning potential and move towards financial independence and homeownership.
According to court documents, the FHA, with the city’s approval, applied for and received federal grants from the Department of Housing and Urban Development (HUD) to fund two full-time FSS program coordinators from January 2012 through November 2014, but neither the city nor the FHA employed any full-time FSS program coordinators during that time. Court documents further allege that the FHA violated the False Claims Act by submitting data into HUD’s Voucher Management System, affirming that it was spending the grant funds on two full‑time FSS program coordinators, when no such coordinators were employed.
“Housing Authorities that receive HUD grants have a duty to help families in need,” said Acting U.S. Attorney Talbert. “When families try to become self-sufficient by applying to programs like Fairfield’s Family Self-Sufficiency Program, they deserve to be assisted at every step by dedicated and responsive professionals. This settlement helps to ensure that limited federal resources are used for that purpose.”
“HUD’s Family Self-Sufficiency program supports families living in public housing and those using Housing Choice Vouchers and working to increase their earned income,” said HUD Regional Administrator Jon Gresley. “With such limited resources available to help reduce household dependency on public subsidy, it is essential that the federal government steward these investments to maximize the benefit to eligible families in Fairfield and beyond. This agreement does that.”
The allegations resolved by the settlement were first raised in a lawsuit filed against the City of Fairfield and the FHA under the qui tam, or whistleblower, provisions of the False Claims Act by a former FHA employee. The False Claims Act allows private citizens with knowledge of fraud to bring civil actions on behalf of the government and to share in any recovery. The whistleblower in this matter will receive approximately $129,000 of the recovery.
This case was handled by Assistant United States Attorney M. Anderson Berry through a coordinated effort with the Department of Housing and Urban Development’s Eric Huhtala, Special Agent for the Office of Inspector General, and Ji Yoo, an attorney with the Office of General Counsel. The claims settled by this agreement are allegations only, and there has been no determination of liability.
Bakersfield Man Indicted for Receiving and Possessing Child PornographyRead the Press Release
FRESNO, Calif. — Colin Lovette Bosby, 49, of Bakersfield, was arraigned today on a three-count indictment charging him with receipt and distribution of child pornography and possession of child pornography, Acting U.S. Attorney Phillip A. Talbert announced.
According to court documents, Bosby used a computer to receive and distribute child pornography using a peer-to-peer file-sharing program. In addition, he possessed child pornography on two thumb drives. This case is the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI). Assistant United States Attorney Megan A. S. Richards is prosecuting the case.
If convicted, Bosby faces a mandatory minimum sentence of 15 years in prison and a statutory maximum of 40 years, and a $250,000 fine for receipt and distribution of child pornography. He also faces a minimum 10-year and maximum 20-year sentence for each count of possession of child pornography. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about internet safety education.
Loomis Man Sentenced to over 2 Years in Prison for Tax Refund Fraud SchemeRead the Press Release
SACRAMENTO, Calif. — Aleksandr Kuzmenko, 33, of Loomis, was sentenced today by United States District Judge Garland E. Burrell Jr. to two years and three months in prison and ordered to pay $573,332 in restitution to the IRS for conspiracy to defraud the United States, Acting United States Attorney Phillip A. Talbert announced.
According to court documents, Kuzmenko worked as a tax preparer at VK Tax Services in Citrus Heights in 2009. Between February 2009 and November 2009, Kuzmenko conspired with others to file approximately 90 fraudulent tax returns with the Internal Revenue Service. The tax returns fraudulently claimed the First-Time Homebuyer Credit, which was worth as much as $7,500. The refunds for the fraudulent claims were electronically deposited into various bank accounts controlled by Kuzmenko’s co-defendants. The fraudulent claims totaled approximately $695,724, of which the IRS paid approximately $573,000.
This case was the product of an investigation by the Internal Revenue Service Criminal Investigation. Assistant United States Attorney Michele Beckwith prosecuted the case.
Co-defendants Peter Kuzmenko and Valeriy Nikitchuk have pleaded guilty to conspiring to defraud the United States and they are currently scheduled to be sentenced on December 2, 2016. Co-defendant Arsen Muhtarov has entered a plea of not guilty. The charges against him are only allegations, and he is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Three Men Charged with Marijuana Conspiracy in Mono CountyRead the Press Release
SACRAMENTO, Calif. — A federal grand jury returned a two-count indictment today against Marco Antonio Esquivel-Cornejo, 30; Jesus Argel Esquivel-Cornejo, 27; and Oliver Lopez Alvarado, 25, all Mexican nationals residing in Modesto, charging them with conspiracy to manufacture marijuana and the manufacture of marijuana, Acting United States Attorney Phillip A. Talbert announced.
According to court documents, Jesus Argel Esquivel-Cornejo and Oliver Lopez Alvarado were arrested in the Humboldt-Toiyabe National Forest in Mono County at a marijuana garden containing 393 marijuana plants. A loaded Beretta 9 millimeter semi‑automatic pistol, and an unloaded Mossberg .22 LR caliber rifle with ammunition were found in the tarp shelter where they were sleeping. Court documents allege that vehicles owned or used by Marco Antonio Esquivel-Cornejo were employed to make periodic supply drops and retrieve processed marijuana from the marijuana garden.
This case is the product of an investigation by the United States Forest Service, the Mono County District Attorney’s Office, the Modesto Police Department, and the Modesto Narcotics Enforcement Team.
If convicted, each defendant faces a maximum statutory penalty of 40 years in prison; or a fine of up to $5 million; or both fine and imprisonment. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; each defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
U.S. Attorney Names District Election Officer to Oversee the Handling of Complaints of Election Fraud and Voting Rights AbusesRead the Press Release
SACRAMENTO, Calif. — Acting U.S. Attorney Phillip A. Talbert announced today that Assistant U.S. Attorney Kevin C. Khasigian will serve as the District Election Officer (DEO) for the upcoming November 8, 2016, general elections for the Eastern District of California. The DEO is responsible for overseeing complaints of election fraud and voting rights abuses in consultation with Justice Department Headquarters in Washington.
Counties in the Eastern District are: Alpine, Amador, Butte, Calaveras, Colusa, El Dorado, Fresno, Glenn, Inyo, Kern, Kings, Lassen, Madera, Mariposa, Merced, Modoc, Mono, Nevada, Placer, Plumas, Sacramento, San Joaquin, Shasta, Sierra, Siskiyou, Solano, Stanislaus, Sutter, Tehama, Trinity, Tulare, Tuolumne, Yolo, and Yuba.
Acting U.S. Attorney Talbert said, “Every citizen must be able to vote without interference or discrimination and to have that vote counted without it being stolen because of fraud. The Department of Justice will act promptly and aggressively to protect the integrity of the election process.”
The Department of Justice has an important role in deterring election fraud and discrimination at the polls and will combat violations whenever and wherever they occur. The Department seeks to ensure public confidence in the integrity of the election process by providing local points of contact within the Department for the public to report possible election fraud and voting rights violations while the polls are open on election day.
Federal law protects against such crimes as intimidating or bribing voters, buying and selling votes, altering vote tallies, stuffing ballot boxes, and marking ballots for voters against their wishes or without their input. Actions designed to interrupt or intimidate voters at polling places by questioning or challenging them, or by photographing or videotaping them under the pretext that these are actions to uncover illegal voting may violate federal voting rights law. Further, federal law protects the right of voters to mark their own ballot or to be assisted by a person of their choice.
In order to respond to complaints of election fraud or voting rights abuses on November 8, 2016, and to ensure that such complaints are directed to the appropriate authorities, DEO Khasigian will be on duty in this District while the polls are open. He can be reached by the public at: (916) 554-2700 and (916) 554-2723.
In addition, the FBI will have special agents available in each field office and resident agency throughout the country to receive allegations of election fraud and other election abuses on Election Day. The FBI can be reached by the public in the Eastern District of California at (916) 746-7000 or at tips.fbi.gov.
Complaints about possible violations of the federal voting rights laws can be made directly to the Civil Rights Division’s Voting Section in Washington, DC by phone 800-253-3931 or (202) 307-2767, by fax (202) 307-3961, by email [email protected], or by complaint form at www.justice.gov/crt/complaint/votintake/index.php.
For more information on the Justice Department’s efforts to protect the right to vote and prosecute ballot fraud visit:
https://www.justice.gov/opa/pr/justice-department-releases-information-election-day-efforts-protect-right-vote-and-prosecu-0
Stockton Real Estate Agent Sentenced to over 3 Years in Prison for Role in Mortgage Fraud SchemeRead the Press Release
SACRAMENTO, Calif. — Lillian Marquez, 41, of Stockton, was sentenced today by U.S. District Judge John A. Mendez to three years and one month in prison for conspiring to commit mortgage fraud, Acting U.S. Attorney Phillip A. Talbert announced.
Marquez pleaded guilty on June 14, 2016. On September 20, 2016, co-defendant Michael Keatts, 59, of Stockton, was also sentenced to three years and one month in prison for his role in the conspiracy. Both Marquez and Keatts were ordered to pay $193,134 in restitution to financial institutions harmed by their scheme.
According to court documents, from February of 2006, through at least August of 2012, Marquez and Keatts operated Colonial Home and Business Services in Stockton. Both defendants were licensed real estate agents who assisted clients in purchasing and selling homes. They both participated in supplying false information to mortgage lending institutions indicating that clients were employed by various businesses that the defendants set up and controlled. In fact, these clients were not employed by those businesses and their actual income from their true employment was far less than what was represented to lending institutions. To support these false claims, the defendants created and submitted fraudulent paystubs and tax documents falsely stating that their clients were so employed.
In addition, both defendants engaged in short sale fraud, in which they assisted clients facing default on their current loans to arrange for short sales of their properties. Unbeknownst to the lending institutions, the defendants arranged for the properties to be sold to straw buyers. The original owners would remain in the properties, and enjoy the benefits of the new loans that the lenders assumed were made to other individuals.
This case was the product of an investigation by the Federal Bureau of Investigation and the Office of the Inspector General for the Department of Housing and Urban Development. Assistant United States Attorney Philip Ferrari prosecuted the case.
Former Bakersfield Police Detective Sentenced to 5 Years in Prison for Methamphetamine Trafficking ConspiracyRead the Press Release
FRESNO, Calif. — Patrick Mara, 36, of Bakersfield, formerly a detective with the Bakersfield Police Department, was sentenced today to five years in prison, to be followed by five years of supervised release, for a conspiracy to traffic methamphetamine, Acting United States Attorney Phillip A. Talbert announced.
According to court documents, between June 14, 2012, and October 29, 2013, while employed as a police detective with the Bakersfield Police Department (BPD), Mara conspired with his partner Damacio Diaz, 44, of McFarland, to use their positions as police officers to seize narcotics and marijuana during the course of their work and sell the stolen drugs to a third party for profit. The third party, an acquaintance of Mara’s, further distributed the drugs into the community. In his plea agreement, Mara admitted that he and Diaz stole approximately 20 pounds of methamphetamine that should have been booked into evidence.
According to court documents, during the investigation, Mara agreed to meet with the FBI on three occasions. When asked a series of questions pertaining to the corruption allegations surrounding Diaz, Mara denied knowledge of any illegal activity, gave vague responses, or stated that he did not recall many details.
Acting U.S. Attorney Talbert stated: “When Mara used his position as a police officer to steal methamphetamine and marijuana, he caused drugs to remain in the community and drug traffickers to go unprosecuted. He endangered the community he pledged to serve and betrayed the honest, hard-working members of the police force. I want to thank the FBI, the DEA, the IRS-Criminal Investigation, and, in particular, the Bakersfield Police Department for their incredible work in this investigation. The Bakersfield Police Department worked side by side with our office, providing unfettered access to its records and dedicating two of its most accomplished detectives to the investigation.”
Bakersfield Chief of Police Williams stated: “Today’s sentencing of Patrick Mara marks a long awaited end to this lengthy investigation. His deliberate betrayal is in no way reflective of any employees within the Bakersfield Police Department. We are committed to providing quality and selfless service to our community while continuing to strengthen the relationships we have built.”
DEA Special Agent in Charge John J. Martin said: “Patrick Mara’s criminal behavior while wearing the badge compromised the integrity of the position, endangered the public and the safety of his colleagues. We may never fully comprehend why someone sworn to ‘protect and serve’ would commit these crimes, but we know honest law enforcement professionals head out each day to make our communities safer places to live, work and raise our children.”
“The American people have given police officers awesome authority,” said Monica M. Miller, Special Agent in Charge of the FBI Sacramento Field Office. “Men and women in law enforcement use that authority to keep us safe. Patrick Mara and his corrupt colleagues betrayed the trust of the citizens they served. They disgraced the profession of law enforcement and added to the burden of their colleagues who daily put their lives on the line with absolute integrity. The FBI and our partners will remain ever vigilant to identify and root out corruption, because honest public service is at the foundation of the law enforcement profession and our nation.”
This case was the product of an investigation by the Federal Bureau of Investigation, the Drug Enforcement Administration, and the Bakersfield Police Department. Assistant United States Attorneys Brian K. Delaney and Angela Scott prosecuted the case.
On October 3, 2016, Judge O’Neill sentenced Diaz to five years in prison and ordered him to begin serving his sentence on December 5, 2016. Diaz had pleaded guilty to bribery, possession and attempted possession with the intent to distribute methamphetamine, and making and subscribing a false income tax return. The case was the product of an investigation by the Federal Bureau of Investigation, the Drug Enforcement Administration, the Internal Revenue Service-Criminal Investigation, and the Bakersfield Police Department.
Government Reaches $2.24 Million Settlement with Institutional Pharmacy Omnicare in Lawsuit First Brought by Former Regional Service Area Director in LodiRead the Press Release
SACRAMENTO, Calif. — Omnicare Inc., a national long-term care pharmacy, will pay a combined $2.24 million to resolve federal and state False Claims Act allegations that it improperly billed federal and state health care programs for prescription drugs that were dispensed to patients in skilled nursing and other institutional care facilities.
Specifically, the settlement resolves allegations that Omnicare employees manually altered the National Drug Code (NDC) field on claims resubmitted to Medicare, Medicaid, and TRICARE, in order to overcome prior rejection of these claims for payment. The alleged conduct occurred between January 1, 2006, and September 1, 2014, prior to CVS Health Corporation’s purchase of Omnicare.
As part of the settlement, CVS Health Corporation and its subsidiaries also entered into a five-year Corporate Integrity Agreement (CIA) with the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) that covers their institutional pharmacy services operations. The CIA is designed to increase accountability and transparency and to avoid or promptly detect future fraud and abuse.
“We are committed to ensuring the integrity of the federal health care system, and this extends to paying only for drugs that accurately reflect an underlying prescription,” said Acting U.S. Attorney Talbert.
The allegations resolved by the settlement were first raised in a lawsuit filed against Omnicare under the qui tam, or whistleblower, provisions of the False Claims Act by a former Regional Servicer Area Director in Omnicare’s pharmacy in Lodi, California. The Act allows private citizens with knowledge of false claims to bring civil actions on behalf of the government and to share in any recovery. The whistleblower in this matter will receive approximately $411,624 of the recovery proceeds.
This case was pursued by Assistant United States Attorney Edward Baker through a coordinated effort with the Department of Health and Human Services Office of Inspector General and Office of General Counsel, the Civil Division of the Department of Justice, the Federal Bureau of Investigation, and the Defense Health Agency. A team from the National Association of Medicaid Fraud Control Units assisted with the investigation and participated in settlement negotiations on behalf of the states, and included representatives from the Offices of the Attorneys General for the states of California, Massachusetts, New York, Ohio, and Texas.
The claims settled by this agreement are allegations only, and there has been no determination of liability.
Former Stockton Woman Indicted with Others in Two Fraud ConspiraciesRead the Press Release
SACRAMENTO, Calif. — On Thursday, October 13, 2016, a federal grand jury returned two indictments charging Kioni Dogan, 36, of Las Vegas and formerly of Stockton, with a total of 21 fraud counts related to claims for unemployment benefits and tax refunds, Acting U.S. Attorney Phillip A. Talbert announced.
The unemployment fraud indictment, charges Dogan, along with Gloria Harris, 56, of Stockton, and Lavonda Bailey, 34, of Las Vegas, with one count of conspiracy to commit mail fraud. It also charges Dogan with 15 counts of mail fraud. According to court documents, Dogan operated a “fictitious employer” scheme. Dogan created an employer with the California Employment Development Department (EDD) that was fictitious and did not conduct any business. Dogan then caused the submission of information to the EDD falsely indicating that various persons were employed by the fictitious entity. Dogan subsequently filed unemployment claims in the names of the fake employees. Harris and Bailey are among the individuals who collected the fraudulent benefits, both in their own names and in the names of other fake employees. The total loss to the California EDD is alleged to be over $2 million.
This is the third indictment returned as a result of the unemployment fraud investigation. On September 15, 2016, Herbert Alexander, 69, of Stockton was charged with unemployment fraud. On December 30, 2015, Deborah Hollimon of Stockton and West Memphis, Arkansas, was charged with unemployment fraud and identity theft.
The tax fraud indictment charges Dogan and Antonia L. Brasley, 47, of Stockton, with one count of conspiracy to submit false claims for tax refunds. It also charges Dogan with four individual counts of submitting false claims. According to court documents, from May 2011 through April 2012, Dogan and Brasley participated in a conspiracy to submit false tax returns to the IRS by obtaining personal identifying information from family, friends, and others, and then submitting returns seeking refunds to which the people listed on the returns were not entitled. To pursue the refunds, false statements were placed on the returns regarding income, withholding from income, and gambling losses, with fraudulent supporting tax forms known as W2-Gs. Dogan is also charged with making false claims in connection with four returns filed in January 2012, each seeking thousands of dollars in tax refunds.
The unemployment fraud case is the product of an investigation by the U.S. Department of Labor, the California Employment Development Department, and the U.S. Postal Inspection Service. Assistant U.S. Attorney Jared C. Dolan is prosecuting the case. The tax fraud case was the product of an investigation by the Internal Revenue Service Criminal Investigation. Assistant U.S. Attorney Christopher S. Hales is prosecuting the case.
If convicted of the unemployment benefits fraud, Dogan, Harris, and Bailey face a maximum statutory penalty of 20 years in prison and a $250,000 fine as to each count. If convicted in the tax fraud case of conspiracy to submit false claims, Dogan and Bralsey each face a maximum statutory penalty of 10 years in prison and a $250,000 fine. If convicted on the tax-related false claims counts, Dogan faces a maximum statutory penalty of five years in prison and a $250,000 fine for each count. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
Merced Man Sentenced to 2 Years in Prison for Growing Marijuana in Sierra National ForestRead the Press Release
FRESNO, Calif. — Emmanuel Castrejon Cardenas, 36, of Merced, was sentenced Monday by U.S. District Judge Lawrence J. O'Neill to two years in prison for conspiracy to cultivate 50 or more marijuana plants, Acting U.S. Attorney Phillip A. Talbert announced.
According to court documents, individuals transporting large amounts of irrigation and other gardening equipment in the Sierra National Forest in the area of Providence Creek in Fresno County were caught on cameras set up by the U.S. Forest Service to monitor mountain lions. An investigation led agents to a large-scale, multi-plot marijuana cultivation site
On September 7, 2015, Cardenas was arrested after he delivered supplies for the clandestine marijuana cultivation site. The next day, law enforcement agents entered the site, eradicated a large number of marijuana plants, and found another individual, Apolinar Duarte, 36, who possessed a firearm. On May 16, 2016, Cardenas and Duarte pleaded guilty. Duarte was sentenced to five years in prison by Judge O’Neill on August 8, 2016.
This case was the product of an investigation by the U.S. Forest Service. Assistant U.S. Attorney Vincenza Rabenn prosecuted the case.
6.5-Year Prison Sentence for California to Connecticut Marijuana Distribution and Money Laundering ConspiracyRead the Press Release
FRESNO, Calif. — Thanousone Volarat, 36, of Fresno, was sentenced Monday by United States District Judge Dale A. Drozd to six years and six months in prison for conspiring to manufacture and distribute marijuana, money laundering, and escaping from the Fresno County Jail, Acting United States Attorney Phillip A. Talbert announced.
According to court documents, beginning in 2009, Volarat and his co-conspirators began purchasing marijuana from sources in California and Oregon. In 2010, Volarat moved to California in order to grow and distribute marijuana for profit under the guise of medicinal marijuana. He was involved in distributing the marijuana both inside and outside of California. Between October 2010 and July 2011, Volarat and his co-conspirators shipped 11 packages of marijuana grown in Fresno and Madera counties primarily to addresses in Connecticut. The marijuana packages were seized by agents.
To finance the distribution conspiracy, proceeds from the marijuana sales were sent from Connecticut to Fresno and other places on the West Coast through structured wires or money transfers. In order to avoid currency transaction reports that banks file for any deposit or withdrawal above $10,000, the defendants kept the deposits and withdrawal below $10,000, a process known as structuring. Structured deposits were made at banks in Connecticut, which were immediately followed by structured withdrawals at bank branches on the West Coast. Human couriers also carried large amounts of the marijuana proceeds on airline flights between the East and West Coasts. Between October 2009 and September 2011, Volarat and his co-conspirators transferred approximately $3 million in marijuana proceeds from the East Coast to the West Coast.
After Volarat was arrested, he was held at the Fresno County Jail pending trial. He was taken to a Fresno medical facility to receive out-patient treatment. While there, he was permitted to use a restroom, where he slipped off his handcuffs, unlocked a back door, and fled. He remained out of custody for nearly a month until he was recaptured by the United States Marshals Service in Los Angeles County. In sentencing Volarat, Judge Drozd noted that his criminal activities were extremely large in scale and also noted that Volarat faces severe ongoing medical issues.
This case was the product of an investigation by the Organized Crime Drug Enforcement Task Force, a program that focuses on large-scale drug trafficking organizations and enables cooperative work between local, state, and federal law enforcement. Drug Enforcement Administration offices in Connecticut and Fresno, East Central Narcotics Task Force in Connecticut, United States Postal Inspector, Internal Revenue Service-Criminal Investigation, the United States Marshals Service, and the Fresno and Madera County Sheriff’s Offices participated in the investigation. Eastern District of California Assistant United States Attorneys Laurel J. Montoya and Kevin Rooney, and District of Connecticut Assistant United States Attorney Geoffrey Stone prosecuted the case.
Volarat’s co-defendants, Phonephitack Volarat and Adam Khamvongsay, have been previously sentenced to federal prison for their involvement in the conspiracy.
Sacramento Woman Sentenced for a Health Care Fraud Scheme that Billed for Unnecessary or Unperformed Dental WorkRead the Press Release
SACRAMENTO, Calif. — Nichol Lomack, aka Nichol Ramirez, of Sacramento, was sentenced today by United States District Judge Morrison C. England Jr. to 21 months in prison for health care fraud, Acting United States Attorney Phillip A. Talbert announced. Additionally, Judge England ordered Lomack to pay $726,300 in restitution.
According to court documents, from 2001 until November 12, 2010, Lomack worked for a dental practice in Sacramento owned and operated by Dr. David M. Lewis. Lomack was responsible for processing and submitting claims to insurance carriers for reimbursement for dental services provided by Lewis. Beginning in late 2008 or early 2009, Lewis began targeting United Parcel Service Inc. employees for dental treatment because their health care plan under the Northern California General Teamsters Security Fund provided 100 percent dental coverage without any annual limits. Lewis offered cash and other incentives to UPS employees for receiving dental treatment or for recruiting other UPS employees to receive such treatment.
According to the plea agreement, upon Lewis’s instruction, Lomack submitted claims to Delta Health Systems, which administered the UPS health care plan, that billed the plan for work that was never performed or for dental work that was unnecessary. Lomack knew that the claims contained false statements relating to services rendered when she submitted them to Delta.
In furtherance of the scheme, Lewis and Lomack created false narratives for dental work that was not performed or created false statements about purported pre-existing dental conditions to justify the work performed. In some instances, Lewis drilled into healthy teeth to install temporary fillings and instructed his assistants to take X-rays of the temporary fillings. Thereafter, Lomack submitted claims to Delta with the X-rays falsely claiming that the X-rays depicted tooth decay that justified further restorative procedures.
“This defendant assisted in a fraud scheme that not only plundered funds meant to provide essential services, but inflicted pain and suffering on patients by performing unnecessary dental procedures, all in the name of additional profit,” said Acting U.S. Attorney Talbert. “We are gratified by today’s sentence and thankful for the critical work done by our partners in the Department of Labor and the State of California.”
Lewis was sentenced to three years and 10 months in prison and was fined $75,000 for his role in the health care fraud scheme and ordered to pay $726,300 in restitution. (2:14-cr-045 MCE)
These cases were the product of an investigation by the U.S. Department of Labor, Office of Inspector General and the U.S. Department of Labor, Employee Benefits Security Administration with assistance from the California Dental Board and the California Attorney General’s Office. Assistant United States Attorney Todd A. Pickles prosecuted the cases.
Modesto Man Pleads Guilty to Staging Car Accidents in a Scheme to Defraud Insurance CompaniesRead the Press Release
FRESNO, Calif. — Victor Hugo Soriano-Villafan, 26, of Modesto, pleaded guilty today to conspiracy to commit mail fraud in a scheme to defraud insurance companies, Acting U.S. Attorney Phillip A. Talbert announced.
According to court documents, from October 2011 until August 2014, Soriano-Villafan conspired with at least six other individuals to stage dozens of car accidents and submit false claims seeking compensation for the damage caused by the staged accidents. As part of the scheme, the defendants would often offer to repair the recruited individual’s vehicle at automobile repair shops that Soriano-Villafan or a co-defendant owned, usually with less-than-complete repair work, and for a fee that was less than the payment from the insurance company. In all, Soriano-Villafan caused at least $750,000 in false insurance claims to be paid as a result of the conspiracy to defraud.
In each staged accident, Soriano-Villafan and other defendants used two or three vehicles and caused about $5,000 to $10,000 in damage to each vehicle. After each staged collision, the defendants submitted cover stories to the insurer that concealed the true cause of the accident. The cover story would commonly use aliases, false identities, and false addresses when describing the defendants. The defendants also used different vehicles in the staged collisions. They were able to do this by obtaining many different vehicles and using false identities to both register the vehicles with the Department of Motor Vehicles and obtain insurance policies for the vehicles. The defendants did this to avoid scrutiny by the insurer that reviewed the false claims. The defendants repeated the scheme in dozens of crashes by recruiting other individuals to participate in the staged collisions. These individuals would allow their vehicles to be damaged and would submit their own claim for damages. In many instances, false claims were submitted to the recruited individual’s insurance company.
This case is the product of an investigation by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and the California Department of Insurance, Fraud Division. Assistant United States Attorneys Patrick R. Delahunty and Henry Z. Carbajal III are prosecuting the case.
Soriano-Villafan is scheduled to be sentenced by U.S. District Judge Dale A. Drozd on January 30, 2017. Soriano-Villafan faces a maximum statutory penalty of 20 years in prison and a $250,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
Charges are pending against co-defendants Juan Ortiz Rivas, 39, of Ceres; Liobigildo Vargas, 46, of Turlock; and, Juan Marquez Cadenas, 30, of Patterson. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
Two Men Indicted for Marijuana Cultivation Operation in Giant Sequoia National MonumentRead the Press Release
FRESNO, Calif. — A federal grand jury returned a three-count indictment today against Mexican nationals Audencio Pineda-Gaona, 36, and Calendario Jimenez-Ramirez, aka Calendario Rodriguez-Jimenez, 54, charging them with conspiring to manufacture, distribute, and possess with intent to distribute and manufacturing marijuana on federal land, and with damaging public land and natural resources as a result of the marijuana cultivation activities, Acting United States Attorney Phillip A. Talbert announced.
According to court documents, the defendants and several other men were found trimming marijuana buds at the grow site in the federally designated Giant Sequoia National Monument in Tulare County in the Sequoia National Forest. Agents found 5,707 marijuana plants and 200 pounds of processed marijuana.
The marijuana cultivation operation caused extensive damage to the land and natural resources. Native trees and shrubs had been cut down to make room for the marijuana plants. Water had been diverted from a tributary stream of the Kern River, which supports Kern River Rainbow Trout. Agents found harmful, banned pesticides and large amounts of trash.
This case is the product of an investigation by the U.S. Forest Service, the California Department of Justice’s Campaign Against Marijuana Planting (CAMP), the California Department of Fish and Wildlife, and the Tulare County Sheriff’s Office. Assistant United States Attorney Karen Escobar is prosecuting the case.
The defendants were previously ordered detained as a flight risk and danger to the community. The men are scheduled for arraignment on the indictment on October 11 in federal court in Fresno. If convicted of the most serious drug offenses as charged in counts one and two, Pineda-Gaona and Jimenez-Ramirez face a maximum statutory penalty of 20 years in prison and a $1 million fine as to each count. If convicted of the environmental crime, the defendants face a maximum statutory penalty of 10 years in prison and a $250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
Glenn County Sheriff's Office Detective Receives U.S. Attorney General’s Award for Distinguished Service in Community PolicingRead the Press Release
SACRAMENTO, Calif. – Today, at a ceremony in Washington, DC, Attorney General Loretta Lynch presented Detective Greg Felton of the Glenn County Sheriff's Office the U.S. Attorney General’s Award for Distinguished Service in Community Policing for field operations, Acting U.S. Attorney Phillip A. Talbert announced.
Detective Felton is being recognized for his work in field operations. He works with multiple agencies to strengthen collaboration and integrate services while handling complex criminal investigations. During the past year, Detective Felton has been a driving force and team leader in the creation of the Glenn County System-wide Mental Health Assessment and Response Team, a collaborative multiagency team that responds to incidents such as school or community threats, suicidal behavior, and bullying. His ability to remain calm in any situation helps to quickly resolve a crisis situation.
The Attorney General’s Award for Distinguished Service in Community Policing recognizes individual state, local, or tribal sworn police officers and deputies for exceptional efforts in community policing. The winning officer or deputy and/or deputies have demonstrated active engagement with the community in one of three areas: 1) Innovations in Community Policing; 2) Criminal Investigations; or 3) Field Operations.
Acting U.S. Attorney Talbert stated: “We are pleased that the work of Detective Felton has been recognized nationally as part of National Community Policing Week. Community policing encourages collaboration between law enforcement agencies and community members to improve public trust and safety. It uses all parties’ shared interest in safe neighborhoods as the foundation for deeper understanding, mutual respect, and closer partnership. Detective Felton exemplifies the core principles of community policing.”
Fairfield Man Indicted on Drug and Gun ChargesRead the Press Release
SACRAMENTO, Calif. — A federal grand jury returned a two-count indictment today against Wesley Keith Smith, 33, of Fairfield, charging him with possession of methamphetamine with intent to distribute and being a felon in possession of a firearm, Acting United States Attorney Phillip A. Talbert announced.
According to court documents, Fairfield City police officers executed a search warrant on a car used by Smith and found methamphetamine in a satchel located in the trunk, along with a digital scale, cash, clear plastic baggies, and two firearms. Officers also executed a search at a residence in Fairfield where Smith was known to reside and found an additional firearm and narcotics distribution paraphernalia. Smith has previously been convicted of an offense that makes it unlawful for him to possess firearms.
This case is the product of an investigation by the Fairfield Police Department and the FBI Vallejo County Violent Crimes Task Force. Assistant United States Attorney Owen Roth is prosecuting the case.
If convicted, Smith faces a mandatory minimum sentence of 10 years, a maximum statutory penalty of life in prison and a $10,250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Washington Man Sentenced for Sending Threats to Placerville CompanyRead the Press Release
SACRAMENTO, Calif. — U.S. District Judge John A. Mendez sentenced Scott Anthony Orton, 57, of Puyallup, Washington, to one year and one day in prison today for transmitting interstate threats, Acting U.S. Attorney Phillip A. Talbert announced.
According to court documents, in July 2015, Orton posted several threatening statements on a popular news website in which he expressed his intent to travel to Placerville, California to kill an officer of the Placerville-based company, Stem Express LLC. On July 16, 2015, among other threats, Orton wrote, “The management of StemExpress should be taken by force and killed in the streets today. Kill StemExpress employees. I'll pay you for it.” Orton also identified the target of his threats by name, and wrote “I’ll pay ten grand to whomever beats me to [the target].”
Acting U.S. Attorney Talbert stated: “Orton made explicit, public statements expressing his intent to kill the victim. His conduct caused the victim to fear for her life and the lives of her family members and colleagues. The sentence imposed by the court recognizes the seriousness of his offense and should act as a deterrent to similar conduct.”
“The FBI is committed to protecting the American people and thoroughly investigating threats of violence against them,” said Assistant Special Agent in Charge Tom Osborne of the FBI Sacramento field office. “Orton’s threats posed a serious threat to public safety and could have inspired a violent attack at StemExpress. We encourage the public to take such threats seriously and report them to prevent violent attacks in their communities.”
This case was the product of an investigation by the Federal Bureau of Investigation. Assistant United States Attorney Brian A. Fogerty prosecuted the case.
St. Paul, Minnesota Man Arrested Today on Federal Child Exploitation and Interstate Travel ChargesRead the Press Release
FRESNO, Calif. — John Baker Rose, 75, of St. Paul, Minnesota, was arrested today in St. Paul after a grand jury in Fresno, California returned a three-count indictment charging him with online coercion and enticement, interstate travel with intent to engage in illicit sexual conduct, and receipt of child pornography, Acting U.S. Attorney Phillip A. Talbert announced.
According to the indictment, between September 2015 and November 2015, Rose made contact with a 14-year-old girl through the internet and persuaded her to meet him. He is alleged to have traveled from St. Paul, Minnesota to Fresno, California for the purpose of meeting her to engage in sexual activity. In addition, he is charged with using a cellphone and computers to receive one or more visual depictions of a minor engaging in sexually explicit conduct.
This case is the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the Fresno Police Department, and the St. Paul Police Department. Assistant U.S. Attorney Brian W. Enos is prosecuting the case.
If convicted, Rose faces a penalty of 10 years to life in prison and a $250,000 fine for the charge of online coercion and enticement, up to 30 years in prison and a $250,000 fine for interstate travel with intent to engage in illicit sexual conduct, and five to 20 years in prison for the charge of receipt of child pornography. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about internet safety education.
Orthopedic Clinics to Pay $2.39 Million to Settle Allegations of Billing Federal Health Care Programs for Reimported ProductsRead the Press Release
SACRAMENTO, Calif. — Three orthopedic clinics will pay a combined $2.39 million to resolve federal and state False Claims Act allegations that they knowingly billed federal and state health care programs for reimported osteoarthritis medications, known as viscosupplements, Acting United States Attorney Phillip A. Talbert announced today.
Orthopedic Associates of Northern California, located in Chico, California, will pay $815,794; San Bernardino Medical Orthopaedic Group Inc., DBA Arrowhead Orthopaedics, headquartered in Redlands, California, will pay $971,903; and Reno Orthopaedic Clinic, headquartered in Reno, Nevada, will pay $602,335.
Viscosupplements, such as Synvisc, Orthovisc, and Euflexxa are injections approved by the Food and Drug Administration for the treatment of osteoarthritis pain in the knee. Viscosupplements are reimbursed by Medicare, Medicaid and other federal health care programs at a set rate based on the average sales price of the domestic product. The government contended that the clinics knowingly purchased deeply discounted viscosupplements that were reimported from foreign countries and billed them to state and federal health care programs in order to profit from the reimbursement system, when such reimported viscosupplements were not reimbursable by those programs. The reimported products allegedly included labeling in foreign languages and in English for additional uses not approved in the United States, which demonstrated that the product was reimported. Moreover, because the product was reimported, the government alleged there was no manufacturer assurance that it had not been tampered with or that it was stored appropriately.
“We are committed to maintaining the integrity of the health care system to ensure that patients receive drugs and devices that are safe and effective, and will take action against companies that take chances with the health of consumers in order to improve their own bottom lines.” said Acting U.S. Attorney Talbert.
“Medicare will not put the health of its beneficiaries at risk by paying for items that have been ‘reimported’ to this country by foreign suppliers,” said HHS OIG SAC Steven J. Ryan. “Once a product leaves the U.S., there is no accountability for whether it is the actual medication being billed, whether it has been properly stored or whether it could be too old to be useful. We will vigorously pursue providers who use and bill for these substances.”
The allegations resolved by the settlement were first raised in a lawsuit filed against the clinics under the qui tam, or whistleblower, provisions of the False Claims Act by a Senior Musculoskeletal Specialty Manager in the Biosurgery Division of Sanofi S.A., which manufactures Synvisc. The Act allows private citizens with knowledge of fraud to bring civil actions on behalf of the government and to share in any recovery. The whistleblower in this matter will receive approximately $430,000 of the recovery proceeds.
This case was prosecuted by Assistant United States Attorney Catherine Swann through a coordinated effort with the Department of Health and Human Services Office of Inspector General and Office of General Counsel, the Food and Drug Administration Office of Office of Chief Counsel, the California Department of Justice, Office of the Attorney General, Bureau of Medi-Cal Fraud and Elder Abuse, and the Nevada Attorney General, Medicaid Fraud Control Unit. The claims settled by this agreement are allegations only, and there has been no determination of liability.
Georgia Woman Sentenced to over 3.5 Years in Prison for Laundering and Structuring more than $200,000 for California Drug Trafficking OrganizationRead the Press Release
FRESNO, Calif. — Ashley Starling Thomas, 29, of Atlanta, Georgia, was sentenced today to three and a half years in prison by U.S. District Judge Lawrence J. O’Neill after being convicted by a jury in May 2016 of conspiring to launder money, conspiring to structure cash transactions, five counts of money laundering, and four counts of structuring cash transactions, Acting United States Attorney Phillip A. Talbert announced.
According to the evidence presented at trial, Thomas moved more than $200,000 in drug money through her bank accounts in a 22-day period in the summer of 2013. Thomas, who resided in Houston, Texas at the time, flew to Northern California on airline tickets paid for by a drug trafficking organization and made cash withdrawals of drug money from her bank accounts at dozens of bank branches in Sacramento, Eureka, and San Francisco. Thomas also traveled to Fresno where the drug trafficking organization was located. All of the cash withdrawals made by Thomas were in amounts less than $10,000 for the purpose of preventing her banks from filing Currency Transaction Reports on her cash withdrawals.
“Ashley Thomas participated in a drug conspiracy by funneling illegal drug proceeds through the financial banking system,” said Michael T. Batdorf, Special Agent in Charge, IRS Criminal Investigation. “Cash deposits were made from Florida into Thomas’ personal bank account and she would then travel to California to make the cash withdrawals. The cash withdrawals represented profits earned by the drug organization. IRS-CI is committed to stopping funnel account activity and other methods of money laundering being used by drug trafficking organizations.”
Thomas was remanded into custody following her trial in May 2016 and was ordered to remain in custody to serve her sentence.
Co-defendants Chad Riffle, Peter Capodieci, Jeremy Murphy, and Aseel Al-Saber have been sentenced and are currently serving their prison terms. Co-defendants Miguel Gonzalez, Brandon Thomas, and Bree Ann Benson have pleaded guilty to conspiring to structure cash transactions and are awaiting sentencing.
This case was brought as part of Operation Footprint, a nationwide law enforcement initiative led by the U.S. Attorney’s Offices, the Internal Revenue Service-Criminal Investigation, the Drug Enforcement Administration, and the United States Postal Inspection Service. Operation Footprint targets large drug trafficking organizations by identifying the transfer of drug proceeds through financial institutions, bulk cash smuggling and other forms of money transfers. Operation Footprint is focused on bringing criminal charges based on Bank Secrecy Act violations in addition to violations of the Controlled Substances Act and the Money Laundering Control Act.
This case was also the product of the Organized Crime Drug Enforcement Task Force (OCDETF), a focused multi-agency, multi-jurisdictional task force investigating and prosecuting the most significant drug trafficking organizations in the U.S. by leveraging the combined expertise of federal, state and local law enforcement agencies. Assistant U.S. Attorneys Grant B. Rabenn and Vincente A. Tennerelli are prosecuting the case.
Former Stanislaus County Resident Pleads Guilty to Obstructing Tax LawsRead the Press Release
FRESNO, Calif. — Frank A. Bilan, 68, formerly of Newman, pleaded guilty today to one count of corrupt endeavor to obstruct and impede the administration of the internal revenue laws, Acting U.S. Attorney Phillip A. Talbert announced.
According to court documents, Bilan earned income as a salaried engineer and through his engineering consulting business. Between 2005 and 2009, Bilan received over $900,000 in income from his employment, consulting business, and withdrawals from his retirement accounts. Bilan, however, did not timely file true and accurate tax returns for tax years 2001 through 2009. When the IRS sent correspondence to Bilan regarding past due taxes, Bilan responded by, among other things, attempting to file false purported income tax returns that did not report any of his gross income for 2001 through 2005, and filing a fictitious form that purported to discharge monies owed by him to the IRS.
This case is the product of an investigation by the Internal Revenue Service-Criminal Investigation. Assistant United States Attorney Henry Z. Carbajal III is prosecuting the case.
“Mr. Bilan intentionally failed to file tax returns with over $900,000 of income,” said Michael T. Batdorf, Special Agent in Charge, IRS Criminal Investigation. “Once the IRS notified him, he sent in erroneous and fictitious forms in his continued attempt to avoid paying his fair share. These kinds of cases are at the core CI’s mission and we will continue to pursue those who undermine the integrity of the U.S. tax system.”
Bilan is scheduled to be sentenced on March 6, 2017, by U.S. District Judge Lawrence J. O’Neill. Bilan faces a maximum statutory penalty of three years in prison and a $250,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
Former Bakersfield Police Department Detective Sentenced to 5 Years in Prison for Bribery, Drug Trafficking, and Filing a False Tax ReturnRead the Press Release
FRESNO, Calif. — Damacio Diaz, 44, of McFarland, formerly a detective with the Bakersfield Police Department, was sentenced today to five years in prison for bribery, possession and attempted possession with the intent to distribute methamphetamine, and making and subscribing a false income tax return, Acting United States Attorney Phillip A. Talbert announced.
U.S. District Judge Lawrence J. O’Neill ordered Diaz to begin serving his sentence on December 5, 2016. Diaz pleaded guilty to the charges on May 31, 2016. Diaz’s former partner, Patrick Mara, 36, of Bakersfield pleaded guilty to related charges on June 20, 2016, and is scheduled to be sentenced on October 17, 2016.
According to court documents, between April 2012 and February 2015, while employed as a police officer with the Bakersfield Police Department (BPD), Diaz handled a criminal informant who was involved in the large-scale sale and distribution of methamphetamine. Diaz continued to operate the informant even though he was fully aware of the informant’s ongoing criminal activity. During this time, Diaz received bribes from the informant in return for intelligence on law enforcement activities as well as protection from investigation and arrest.
In addition to accepting illegal bribes, Diaz also engaged in drug trafficking while with the BPD. On September 20, 2012, while on duty, Diaz stopped a vehicle operated by two individuals from Yakima, Washington and used a BPD dog handler and police dog to search the vehicle. The search uncovered an ice chest containing approximately 10 pounds of methamphetamine divided into multiple bags. The BPD dog handler did not seize any of the drugs from the vehicle, but turned the scene over to Diaz and Mara to secure the methamphetamine and oversee the investigation of the incident. A week later, Diaz booked approximately one pound of methamphetamine from the vehicle stop into evidence. Diaz and Mara maintained possession of the remaining nine pounds of methamphetamine, and they ultimately sold it for their own personal gain.
According to the plea agreement, Diaz also filed a joint income tax return for the calendar year 2012 that falsely reported total income of $168,485 and did not include additional income of at least $97,900.
Acting U.S. Attorney Talbert stated: “Diaz had a life that afforded him many opportunities, including the opportunity to serve and protect his community as an officer of the law. Diaz turned his back on those opportunities and broke the trust his community placed in him, violating the very laws he was sworn to enforce. Public corruption takes a heavy toll on our communities, and our office remains committed to prosecuting such conduct.”
Bakersfield Chief of Police Williams stated: “I appreciate the efforts of all agencies involved in this lengthy and exhaustive investigation and I am thoroughly satisfied with the ultimate conviction of Damacio Diaz. The behavior and criminal activity that was exposed during this comprehensive investigation is in no way reflective of the commitment and remarkable public service the over 500 employees of the Bakersfield Police Department provide to our community on a consistent basis. Diaz violated not only the trust of this organization but that of this community. The Bakersfield Police Department is committed to building and maintaining public trust by holding our employees accountable for their actions and we will continue to provide quality service to our community. We appreciate the support we have been given throughout this investigation and wish to thank the community for their patience and understanding.”
DEA Special Agent in Charge John J. Martin stated, “Damacio Diaz committed crimes in a community he took an oath to serve and protect. In doing so, he betrayed the trust of the public and his fellow officers.”
“Damacio Diaz used his lawful authority as a sworn peace officer with the Bakersfield Police Department to illegally enrich his self-interests,” said Michael T. Batdorf, Special Agent in Charge, IRS Criminal Investigation. “Greed was a major motivation for Diaz to begin making unfortunate decisions that brought him to conspire with drug dealers and accept bribes for money. IRS-CI will continue to work with our law enforcement partners and the United States Attorney’s Office to investigate these types of crimes that have a negative impact on our communities and the American Taxpayer.”
“Diaz's illegal activity caused irreparable damage to his reputation, put the lives of others at risk, undermined public trust in the Bakersfield Police Department, and facilitated criminal activity,” said Special Agent in Charge Monica M. Miller of the FBI Sacramento field office. “The FBI and its federal law enforcement partners will continue to identify and investigate individuals who violate their oath of service and ignore the commitment they made to their communities.”
This case was the product of an investigation by the Federal Bureau of Investigation, the Drug Enforcement Administration, the Internal Revenue Service-Criminal Investigation, and the Bakersfield Police Department. Assistant United States Attorneys Brian K. Delaney and Angela Scott prosecuted the case.
Chico Man Found Guilty of Receipt, Distribution, and Conspiracy to Produce Child PornographyRead the Press Release
SACRAMENTO, Calif. — After a three–day trial, a federal jury found Jesse Davenport, aka Draco John Flama, 41, of Chico, guilty today of conspiracy to sexually exploit a child, two counts of receipt of child pornography, and one count of distribution of child pornography, Acting United States Attorney Phillip A. Talbert announced. The trial was held before United States District Judge Morrison C. England Jr.
According to evidence presented at trial, in September of 2013, Davenport was on parole for a prior offense. During a parole search, his parole agent seized a micro-SD card from a phone he possessed. Several days later, Davenport cut off his electronic monitor and fled from parole. A subsequent search of the seized micro-SD card revealed a video of a woman engaged in sexually explicit conduct with a child approximately 2-3 years old. Additional investigation identified the woman in the sexually explicit video as a resident of Connecticut. She was later arrested and admitted that she conspired with Davenport to produce the video after meeting Davenport in an online chat room focused on bondage, domination, sadism, and masochism. After the Connecticut woman sent the sexually explicit video of the minor to him, Davenport distributed the video to another person. Later, the Connecticut woman sent the video to Davenport a second time.
This case is the product of an investigation by the Federal Bureau of Investigation, the Redding Police Department, and the California Department of Corrections and Rehabilitation. Assistant United States Attorney André M. Espinosa is prosecuting the case.
Davenport is scheduled to be sentenced by Judge England on January 5, 2017. Because of his prior conviction, Davenport faces a mandatory minimum sentence of 25 years in prison and a maximum possible penalty of 50 years in prison and a $250,000 fine on the conspiracy conviction. Similarly, because of his prior conviction he faces a mandatory minimum sentence of 15 years in prison and a maximum possible penalty of 40 years in prison and a $250,000 fine on each of the receipt and the distribution convictions. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about internet safety education.
Stockton Man Pleads Guilty in Credit Card Fraud and Identity Theft SchemeRead the Press Release
SACRAMENTO, Calif. — On Thursday, September 29, 2016, Vuthiya Tim, 31, of Stockton, pleaded guilty to conspiracy to commit credit card fraud and theft of mail matter, Acting United States Attorney Phillip A. Talbert announced.
According to court documents, between March 2014 and September 2015, Tim and eight co-conspirators obtained personal information from victims and used that information to create unauthorized Target credit or debit accounts, called REDcards. They used the Target REDcard account numbers to buy large amounts of electronics, prepaid gift cards, and other goods at Target locations throughout the Sacramento area, Northern California, and elsewhere. In all, more than 300 counterfeit and unauthorized access devices were possessed, used, produced, or trafficked by members of the conspiracy, and over 1,000 victims have been identified to date as having had their identities compromised as a result of the conspiracy.
In addition, Tim pleaded guilty to stealing mail on April 11, 2013, from the post office in Clements, which is in San Joaquin County.
This case is the product of an investigation by the United States Postal Inspection Service and the Stockton Police Department. Assistant United States Attorneys André M. Espinosa and Rosanne L. Rust are prosecuting the case.
Tim is scheduled to be sentenced by U.S. District Judge Troy L. Nunley on December 15, 2016. Tim faces maximum penalties of five years in prison and a $250,000 fine on both counts. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
Sacramento Resident Indicted for Receiving Child PornographyRead the Press Release
SACRAMENTO, Calif. — Jeffrey Miles Hayes, 54, of Sacramento, was arrested today after a federal grand jury returned an indictment charging him with receipt of child pornography, Acting United States Attorney Phillip A. Talbert announced.
According to court documents, law enforcement identified an internet connection at Hayes’s residence that was being used to upload child pornography to blog sites. A search of the residence revealed an iPad, identified as belonging to Hayes, that was receiving and distributing child pornography through chat messages.
This case is the product of an investigation by the Sacramento Internet Crimes Against Children Task Force in conjunction with the Sacramento County Sheriff’s Office and the Federal Bureau of Investigation. Assistant United States Attorney Shelley D. Weger is prosecuting the case.
If convicted, Hayes faces a sentence of 15 to 40 years in prison and a $250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about internet safety education.
Vallejo Kidnapping Defendant Pleads GuiltyRead the Press Release
SACRAMENTO, Calif. — Matthew Muller, 39, of South Lake Tahoe, pleaded guilty today to one count of kidnapping, Acting United States Attorney Phillip A. Talbert announced.
According to court documents, on March 23, 2015, between 3:00 a.m. and 5:00 a.m., Muller broke into a home on Mare Island in Vallejo and using a stun gun and a simulated firearm, ordered the occupants, Aaron Quinn and Denise Huskins, to lie still while he bound them, blindfolded them, and had them drink a sleep-inducing liquid. Muller played a prerecorded message to the victims that threatened that any noncompliance would be punished by face cutting or electric shock. Muller then placed Huskins in the trunk of a car and drove her to his residence in South Lake Tahoe where he kept her under his control for two days, at times bound and blindfolded. Muller sent Quinn emails demanding ransom amounts totaling $17,000, but ultimately released Huskins in Huntington Beach on March 25, 2015, with no ransom ever being paid.
During and after the kidnapping, Muller sent emails to a reporter in San Francisco, that claimed, among other things, that the kidnapping had been carried out by a group of elite criminals who were perfecting their kidnapping-for-ransom tactics.
Muller was identified as a suspect in the Vallejo kidnapping following an investigation into a home-invasion burglary that occurred in Alameda County on June 5, 2015. Dublin Police Services of the Alameda County Sheriff’s Department arrested Muller and searched his South Lake Tahoe residence. They located and seized evidence from the Vallejo kidnapping. An officer of the Vallejo Police Department located Muller’s Vallejo storage locker and a search revealed aerial drones that Muller referred to in his emails to the reporter.
FBI analysis of Muller’s computers uncovered a sound recording that simulated people whispering to each other, a sound recording consistent with the instructions given to Aaron Quinn and Denise Huskins, and a video recording of Muller together with Huskins in Muller’s residence. She was blindfolded and fully under Muller’s control.
This case is the product of an investigation by the FBI, the Dublin Police Services of the Alameda County Sheriff’s Office, and the Vallejo Police Department. Assistant United States Attorneys Matthew D. Segal and Heiko P. Coppola are prosecuting the case.
Acting U.S. Attorney Phillip A. Talbert said, “Muller committed a serious and violent crime that terrorized the victims in this case. He violated the sanctity of their home and caused fear and panic for all those affected by the kidnapping. My office is grateful that Alameda County authorities responded so effectively to the Alameda County break-in and then provided the information that led to the investigation and charges in this case. The high quality of the work by the Alameda County Sheriff’s Office, the Alameda County District Attorney, the Vallejo Police Department, and the FBI is reflected in the two guilty pleas Muller has entered, first in Alameda County and now in the Eastern District of California. We are committed to continuing to seek justice in this case as it continues to sentencing.”
Muller is scheduled to be sentenced by U.S. District Judge Troy L. Nunley on January 19, 2017 at 1:30 p.m. Muller faces a maximum statutory penalty of life in prison and a $250,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
As long as Muller accepts responsibility and adheres to his promises in the plea agreement, the plea agreement provides that the Government will recommend a sentence of no more than forty years of imprisonment. There is no parole in the federal system. Under the plea agreement, upon release, Muller should be subject to the most intensive supervision, surveillance, and monitoring that is technologically available at the time of his release. The plea binds only the United States Attorney’s Office for the Eastern District of California and cannot bind any other federal, state, or local prosecuting, administrative, or regulatory authorities.