Eastern District of California

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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

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.

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.

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.

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.

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.

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, 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.

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.

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.

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.”

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.

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.

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.

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.

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.

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.

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.

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.

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, 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.

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.

BAKERSFIELD, Calif. — A defendant pleaded guilty to misdemeanor charges brought earlier today in a criminal complaint and was immediately sentenced to a total of 13 months in prison, Acting United States Attorney Phillip A. Talbert announced.

U.S. Magistrate Judge Jennifer L. Thurston sentenced Angel Gilberto Garcia-Avalos, (Garcia), 29, of Michoacán, Mexico, to six months in prison for causing a fire on federal land that resulted in the Cedar Fire that has been burning in Kern and Tulare Counties. Judge Thurston also sentenced him to seven months in prison for two separate counts of making false statements to U.S. Forest Service law enforcement officers. The sentences are to be served consecutively for a total of 13 months. The maximum possible sentence for each of the three charges was six months in prison. Garcia was also ordered to pay $61 million in restitution.

In sentencing Garcia, Judge Thurston noted that Garcia demonstrated “significant negligence” and took no action to get help after the fire started.

According to the complaint, the Cedar Fire started on August 16, 2016, when Garcia was driving off-road in the Sequoia National Forest. Garcia falsely represented to a Forest Service law enforcement officer on the day the fire started that his vehicle had been stolen after he parked it on the side of California Highway 155. Two weeks later, Garcia falsely represented to a special agent of the Forest Service that his vehicle was taken when he parked it on the paved road and that he had not driven his vehicle off the highway onto a dirt road.

According to the complaint, the Cedar Fire started in the area of the Cedar Creek Campground in the Sequoia National Forest in Kern County and spread to Tulare County. Garcia drove his vehicle off of Highway 155 onto an unimproved, rough dirt road in the forest. As he was driving on the dirt road, his car got stuck while attempting to drive over a berm and rolled back hitting a tree. The muffler and catalytic converter of the vehicle were in direct contact with dead grass and sparked the Cedar Fire. To date, the Cedar Fire has destroyed approximately 29,332 acres of National Forest land, including at least six residences.

This case was the product of an investigation by the U.S. Forest Service, the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and Enforcement and Removal Operations (ERO), the Kern County Fire Department, and the Kern County Probation Department. Assistant United States Attorney Karen A. Escobar prosecuted the case.

SACRAMENTO, Calif. — Bart Wayne Volen, 54, of San Diego and Haiku, Hawaii, was sentenced today by United States District Judge Troy L. Nunley, to eight years and six months in prison for defrauding the United Auburn Indian Community, conspiring to launder monetary instruments, and filing a false tax return, Acting United States Attorney Phillip A. Talbert announced.

At sentencing, Judge Nunley noted that Volen had stolen from people who had become “like family members” to him.

“Bart Volen and his co-defendants used their trusted positions to steal millions of dollars from the UAIC,” said Michael T. Batdorf, Special Agent in Charge, IRS Criminal Investigation. “Rather than stopping the fraud, Mr. Volen chose to benefit from it.   Today’s sentencing should send a clear message that those involved in these types of schemes will be held accountable for their actions.”

According to court documents, between October 2006 and December 2007, Volen, Gregory Scott Baker, of Newcastle, and Darrell Patrick Hinz, 48, of Cameron Park, engaged in a scheme to defraud the UAIC. An indictment from August 2012 charged the defendants with conspiring to commit mail and wire fraud and various money laundering violations. A superseding indictment from April 2013 added additional charges, alleging that Volen and Hinz filed false tax returns in 2006 and 2007, and that Baker filed false tax returns from 2006 through 2009. The defendants ultimately stole over $18 million from the UAIC through their scheme.

According to court documents, in October 2006, the UAIC hired Volen, a developer, to finish construction on a school, a community center, and administrative offices on UAIC‑owned property on Indian Hills Road in Auburn. Volen submitted false and inflated invoices to the UAIC, and Baker and Hinz, both UAIC employees, approved the fraudulent invoices based on a kickback agreement between the three men. Volen supported his invoices with inflated cost proposals from his general contractor’s company, Sequoia Pacific Builders (SPB), and, at times, inflated invoices from various subcontractors. At Volen’s direction, over 160 SPB cost proposals were fraudulently inflated.

Baker was the UAIC tribal administrator whose duties included overseeing the Indian Hills office project. In this position of trust, he was subordinate only to the UAIC tribal council. Hinz was a contract employee hired by the UAIC to manage the construction at the Indian Hills office project site. Both Baker and Hinz were required to approve all invoices before the UAIC tribal council would sign checks to pay for completed work. During the scheme to defraud the tribe, both Baker and Hinz engaged in conduct to ensure that the tribal council would pay for the inflated and fraudulent invoices submitted by Volen. They were later paid by Volen for their participation in the scheme.

In order to disguise the proceeds of the fraud, Hinz sent a number of fraudulent invoices to Volen. These invoices were for consulting work that Hinz claimed he did for Volen. After the issuance of the false invoices, Volen sent Hinz 29 checks, totaling approximately $7.5 million. Hinz paid Baker indirectly for his assistance in the scheme, using money he received from Volen.

According to court documents, Hinz paid for a $12,500 weekend trip that he and Baker took in Hawaii and for certain obligations owed by Baker. Hinz also purchased a number of things for Baker, including various assets, personal property — a $70,000 BMW and a mobile home — several investment properties, a vacation condominium in South Lake Tahoe, and various improvements to property, such as a $54,000 pool at his primary residence. All of these transactions were conducted for the purpose of concealing and disguising the proceeds from the UAIC fraud. During the course of the scheme, Baker received over $1.4 million.

With regard to the tax offense, according to court documents, Volen filed tax returns in which he falsely claimed personal expenses as business deductions. As a result, the United States suffered a tax loss of over $4.3 million.

Volen, Baker and Hinz have agreed to pay at least $17 million in restitution to the UAIC. Eatough has agreed to pay between $600,000 and $950,000 in restitution to the UAIC.

This case was the product of an investigation by the Internal Revenue Service, Criminal Investigation. Assistant United States Attorneys Michael M. Beckwith, John K. Vincent and Kevin C. Khasigian prosecuted the case.

Chris W. Eatough, the owner of Sequoia Pacific Builders, previously pleaded guilty to a felony related to this case on June 20, 2013. Mr. Eatough was charged in case number 2:13-cr-214 TLN. Eatough is scheduled to be sentence by Judge Nunley on December 8, 2016. Any sentences issued in Mr. Eatough’s case will be determined at the discretion of the court after consideration of any applicable statutory sentencing factors and the Federal Sentencing Guidelines, which take into account a number of variables.

FRESNO, Calif. — Alejandro Ramirez-Rojo, 31, of Mexico, was sentenced today by United States District Judge Lawrence J. O'Neill to 27 months in prison and ordered to pay $8,752 in restitution to the U.S. Forest Service for conspiring to manufacture, distribute, and possess with intent to distribute marijuana in the Sierra National Forest, Acting United States Attorney Phillip A. Talbert announced.

According to court documents, co-defendant Humberto Ceballos-Rangel, 37, of Mexico, was found at a campsite within the marijuana cultivation site, where agents found 5,904 marijuana plants and a loaded firearm. Ramirez-Rojo, Francisco Javier Gomez-Rodriguez, 38, of Pihuamo, Jalisco, Mexico, and Anthony Isaac Santibanez, 20, of Woodlake, were found a short time later approaching the grow site in a vehicle that agents had previously identified as a vehicle used to deliver supplies to the grow site. A .22-caliber rifle was found in the vehicle, along with .40-caliber rounds of ammunition.

Ceballos-Rangel was sentenced on February 18, 2016, to three years in prison; Gomez-Rodriguez was sentenced on July 2, 2016 to three years and five months in prison; and Santibanez is scheduled to be sentenced on October 3, 2016.

The cultivation operation encompassed at least five acres of national forest land. Throughout the grow site, natural vegetation had been cut to accommodate the marijuana plants, related trails, and cooking and sleeping areas. A water reservoir had been dug into the soil to store water for use in the marijuana cultivation operation. The water in the reservoir had been diverted from a nearby creek. The soil had significant disturbance throughout the impacted area. There were also several trash pits that had mostly been covered in dirt. Two large net loads of trash, two five-gallon propane tanks, and 2,000 feet of irrigation hose were removed, along with the marijuana plants. Law enforcement agents also found insecticide at the site.

This case was the product of an investigation by the U.S. Forest Service, U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), California Department of Justice’s Campaign Against Marijuana Planting (CAMP), California Department of Fish and Wildlife, and Madera County Narcotic Enforcement Team (MADNET). Assistant United States Attorney Karen A. Escobar is prosecuting the case.

FRESNO, Calif. — Veronica Rosales-Capitaine, 49, of Fresno, pleaded guilty today to conspiring to produce, transfer, possess, and sell false identification documents, Acting United States Attorney Phillip A. Talbert announced.

According to court documents, between June 2015 and June 2016, Rosales-Capitaine conspired with others to manufacture 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. In March 2010, Rosales-Capitaine was convicted of the same offense and sentenced to six months’ imprisonment, admitting that between January 2009 and October 2009, she conspired with others to manufacture fraudulent identification documents.

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.

On June 16, 2016, Rosales-Capitaine and five co-defendants were arrested for the scheme. Co-defendants Francisco Javier Hidalgo-Flores and Lizet Amairani Ramirez-Zazueta, also of Fresno, pleaded guilty on September 19, 2016; charges are pending against the remaining co-defendants. The charges are only allegations; they are presumed innocent until and unless proven guilty beyond a reasonable doubt.

Rosales-Capitaine is scheduled to be sentenced by Chief Judge Lawrence J. O'Neill on December 19, 2016. Rosales-Capitaine faces a maximum statutory penalty of five 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.

SACRAMENTO, Calif. — Sherry Taggart, 56, of El Dorado Hills, pleaded guilty today to conspiring to file false claims and filing false claims, Acting United States Attorney Phillip A. Talbert announced.

According to court documents, Taggart and her co-conspirator, Barbara Antonucci, an unlicensed tax preparer, 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.

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.

Taggart is scheduled to be sentenced by U.S. District Judge Garland E. Burrell Jr. on December 9, 2016. Antonucci is scheduled to be sentenced by Judge Burrell on December 2, 2016. Taggart and Antonucci face a maximum statutory penalty of up to 10 years in prison and a $250,000 fine for conspiracy to file false claims. The maximum penalty for filing false claims is up to five years in prison and a $250,000 fine. The actual sentences, 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.

FRESNO, Calif. — Bakersfield residents Lynnsi Marguerite Dunbar, 29; and Daniel Harte, 50, were arrested today after a federal grand jury returned a multicount indictment, charging them with conspiracy to commit wire fraud and other charges related to a scheme to defraud Bakersfield Pipe and Supply Inc., (BPS), Acting United States Attorney Phillip A. Talbert announced. Lynnsi Dunbar’s husband Kye Aaron Dunbar, 30; is also charged in the scheme, and is already in custody on an unrelated charge.

According to court documents, between March 17, 2014, and October 22, 2014, the three defendants conspired together to defraud BPS, which is headquartered in Bakersfield, by creating false invoices for payment. Lynnsi Dunbar was an employee of BPS who, with the help of Kye Dunbar and Harte, created a fictitious trucking company in the name of Harte Trucking. Harte Trucking existed in name only and was created by the defendants for the sole purpose of submitting fraudulent invoices to BPS for payment for services never performed. As a result of this conspiracy, the defendants were able to defraud BPS out of $287,000.

This case is the product of an investigation by the Federal Bureau of Investigation. Assistant United States Attorney Brian K. Delaney is prosecuting the case.

If convicted, defendants face 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 defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

SACRAMENTO, Calif. — Herbert Alexander, 69, was arrested today at his Stockton residence after a federal grand jury returned a four-count indictment, charging him with unemployment fraud, Acting United States Attorney Phillip A. Talbert announced.

According to court documents, Alexander operated a “fictitious employer” scheme by creating a fictitious employer with the California Employment Development Department (EDD) that did not conduct any business. Alexander then caused the submission of information to the EDD falsely indicating that various persons were employed by the fictitious employer. Alexander subsequently filed unemployment claims in the names of the fake employees.

This case is the product of an investigation by the United States Department of Labor, Office of Inspector General, the U.S. Postal Inspection Service, and the California Employment Development Department, Investigations Division. Assistant United States Attorney Jared C. Dolan is prosecuting the case.

This is the second indictment returned as a result of the investigation. On December 30, 2015, Deborah Hollimon of Stockton and West Memphis, Arkansas, was charged with unemployment fraud and identity theft. Hollimon is currently a fugitive. Anyone with information on her whereabouts should call (415) 625-2685.

If convicted, Alexander 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 defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

SACRAMENTO, Calif. — U.S. District Judge John A. Mendez sentenced Rachel Siders, 41, of Roseville, to 14 and a half years in prison for her involvement in mortgage fraud schemes that cost financial institutions over $17 million, Acting U.S. Attorney Phillip A. Talbert announced.

Federal juries returned verdicts in two trials, in March 2015 and December 2015 finding her guilty of multiple counts of bank fraud, wire fraud, mail fraud, making a false loan application, and committing aggravated identity theft.

According to evidence presented at the first trial, in 2008 Siders and co-defendant Theo Adams, 50, of Roseville, applied for a home equity line of credit using his relative’s name on an underwater Roseville property owned by Adams. They submitted false tax returns in the relative’s name with significantly inflated income along with mortgage application documents with forged signatures. Siders, a notary public, falsely notarized the loan application documents, which were sent to Washington Mutual Bank. The bank relied upon the false documents to provide a $250,000 line of credit. Siders received $170,000 of the proceeds. After making minimal payments, the defendants defaulted on the loan.

According to evidence presented at the second trial, from mid-2006 through early 2008, Siders and Vera Kuzmenko, 46, of Loomis, and other defendants engaged in a mortgage fraud scheme involving over 30 properties in the Sacramento area. They secured more than $30 million in residential mortgage loans on more than 30 homes purchased through straw buyers. The loan applications contained materially false information as to the straw buyers’ income, employment, assets, and intent to occupy the residences. Records introduced at trial showed that Vera Kuzmenko received millions of dollars, and that Rachel Siders received hundreds of thousands of dollars.

Vera Kuzmenko, was a licensed real estate agent for part of the scheme, and Rachel Siders ran the Rocklin office of the escrow company used on the majority of the transactions. She helped funnel millions of dollars to her co-defendants, which was not disclosed to the lenders.

“The sentence today reflects the seriousness of Siders’ crimes, which included participation in two separate mortgage fraud schemes. Over the course of two years, Siders oversaw and participated in numerous fraudulent loans and diverted money into shell accounts for her own benefit. She abused her position as an escrow officer and as a notary public to make this criminal enterprise succeed,” said Acting U.S. Attorney Talbert. “The sentence imposed is a significant reminder that those who engage in such conduct will be held accountable.”

“Today’s sentence sends a clear message; anyone profits from fraudulent mortgage transactions—whether by creating the scheme or facilitating it—will not escape justice,” said Supervisory Special Agent Dan Bryant at the FBI Sacramento field office. “The FBI aggressively pursues those involved in such large-scale, complex financial fraud matters to seek justice for the victims and protect the regional economy.”

“Rachel Siders was driven by greed in her participation in this mortgage fraud which targeted the Sacramento area,” said Michael T. Batdorf, Special Agent in Charge, IRS‑Criminal Investigation. “Today’s sentencing is a reminder how serious our courts consider this criminal activity and our commitment in providing financial expertise to our federal partners in these types of crimes.”

This case was the product of an investigation by the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigation. Assistant U.S. Attorneys Lee S. Bickley, Michael D. Anderson, and Matthew D. Segal prosecuted the case.

On March 15, 2016, Judge Mendez sentenced Vera Kuzmenko to 14 years in prison. She was found guilty of multiple counts of mail and wire fraud, money laundering and witness tampering. On April 19, 2016, Theo Adams, 50, of Roseville, was sentenced to two years in prison. Previously, Judge Mendez sentenced co-defendants Peter Kuzmenko, 38, of West Sacramento, to 19 years in prison; Aaron New, 42, of Sacramento, to 11 years and three months in prison; Nadia Kuzmenko, 37, formerly of Loomis, to eight years in prison; and Edward Shevtsov, 52, of North Highlands, to eight years in prison. They were found guilty on February 13, 2015, after a 21-day trial, of multiple counts of mail and wire fraud associated with the mortgage fraud scheme. In addition, Peter Kuzmenko, Edward Shevtsov, and Aaron New were found guilty of money laundering associated with the scheme, and Nadia Kuzmenko was found guilty of witness tampering.

FRESNO, Calif. — Two Fresno residents pleaded guilty today to a scheme that involved the manufacture and sale of fraudulent identification documents, including fraudulent alien registration receipt cards and social security cards, Acting U.S. Attorney Phillip A. Talbert announced.

According to court documents, Francisco Javier Hidalgo-Flores, 25, pleaded guilty to conspiring to produce, transfer, possess, and sell false identification documents, and co‑defendant Lizet Amairani Ramirez-Zazueta, 26, pleaded guilty to transferring false identification documents.

According to the plea agreements, between June 2015 and June 17, 2016, 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 in Fresno and Madera Counties.

This case is 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.

On June 16, 2016, Hidalgo-Flores and Ramirez-Zazueta and four co-defendants were indicted for the scheme. Charges are pending against the remaining co-defendants. The charges are only allegations; they are presumed innocent until and unless proven guilty beyond a reasonable doubt.

Hidalgo-Flores and Ramirez-Zazueta are scheduled to be sentenced by Chief U.S. District Judge Lawrence J. O'Neill on December 12, 2016. Hidalgo-Flores faces a maximum statutory penalty of five years in prison and a $250,000 fine; Ramirez-Zazueta faces a maximum statutory penalty of 15 years in prison and a $250,000 fine. The actual sentences, 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, Calif. — Scott Albert Johnson, 36, of Turlock, was sentenced today by United States District Judge Garland E. Burrell Jr. to two years and six months in prison and ordered to pay $13,854 in restitution for his role in a conspiracy to defraud the United States by filing false claims for federal tax refunds, Acting United States Attorney Phillip A. Talbert announced.

According to court documents, beginning in 2011, Johnson, who was incarcerated on state charges at the California Correctional Center in Susanville, and three fellow inmates participated in a conspiracy to file false claims for federal tax refunds. Johnson and his fellow conspirators obtained the personal identification information of other inmates, with or without their consent, and provided it to three other co-defendants located outside the prison. The co-defendants then used that information to prepare and file false income tax returns with the Internal Revenue Service, claiming refunds that they knew to be false and to which the inmates were not entitled. The proceeds from these refunds were deposited into bank accounts for the personal benefit of the conspirators, and transferred to the inmate commissary accounts. Johnson also filed at least four tax returns in his own name seeking false refunds.

The conspirators filed at least 247 false claims for income tax returns in tax years 2008 through 2011. The IRS stopped some of these refunds, however, approximately 138 fraudulent refunds totaling approximately $219,984 were issued.

“This fraud was perpetrated from behind bars,” said Michael T. Batdorf, Special Agent in Charge, IRS Criminal Investigation. “Johnson and his co-defendants had the time to concoct a scheme to systematically defraud the government and the taxpaying public. Refund fraud is a top priority, and we will continue to aggressively pursue those who undermine the integrity of the U.S. tax system.”

This case is the product of an investigation by the by the IRS, Criminal Investigation, the Federal Bureau of Investigation, and the Investigative Services Unit at the California Correctional Center. Assistant United States Attorney Amy Schuller Hitchcock is prosecuting the case.

To date, three other co-defendants have pleaded guilty and have been sentenced: on July 15, 2015, Edwin Ludwig IV was sentenced to seven years in prison; on July 29, 2016, Judy Mullin was sentenced to 21 months in prison; and on August 19, 2016, Daniel Coats was sentenced to 18 months in prison. The charges against the three remaining defendants are pending. The charges against them are only allegations; they are presumed innocent until and unless proven guilty beyond a reasonable doubt.

SACRAMENTO, Calif. — On Wednesday, September 14, 2016, Domonic McCarns, 41, of Irvine, was sentenced to 14 years in prison by U.S. District Judge Kimberly J. Mueller for conspiracy to commit mail fraud for his participation in a nationwide foreclosure-rescue scam, Acting U.S. Attorney Phillip A. Talbert announced.

McCarns is the final defendant to be sentenced for a pair of schemes that lured homeowners with the promise to help them avoid foreclosure and repair their credit. Two indictments were brought in 2008. Four defendants were convicted after two jury trials, 13 defendants pleaded guilty, and now, all 17 defendants have been sentenced. On September 9, 2013, Charles Head was sentenced to 35 years in prison, and on October 29, 2014, his brother and fellow leader in the scheme Jeremy Michael Head was sentenced to 10 years in prison.

Acting U.S. Attorney Talbert said: ‘This scheme purposely targeted the financially vulnerable during their time of greatest distress with promises of help. The defendants tricked the victims into handing over their most valuable assets, their homes. Few economic crimes are more reprehensible. This final sentence in this case will bring some measure of justice for their victims.”

“In large fraud schemes like the one devised by Charles Head, we can’t forget about the individual homeowners who comprised the millions of dollars in losses,” said Monica M. Miller, Special Agent in Charge of the Sacramento division of the FBI. “Today’s sentencing ends an investigation that has been ongoing for more than 10 years and brings some closure to the innocent people who were victimized by Head’s callous scheme.”

“Dominic McCarns and his co-conspirators assured innocent homeowners across the country facing foreclosure that they could turnaround their misfortunes and keep their homes,” said Michael T. Batdorf, Special Agent in Charge, IRS-Criminal Investigation. “However the defendants had other plans which resulted in one of the most harmful mortgage fraud schemes in the country. The sentence handed down today by the court is befitting of this defendant and his actions.”

According to court documents, the defendants solicited homeowners facing foreclosure, and through misrepresentations, fraud, and forgery, substituted straw buyers for the victim homeowners on the titles of properties without the homeowners’ knowledge. These straw buyers were often friends and family members of the defendants, or were solicited on the internet. Once the straw buyers were on title to the homes, the defendants applied for mortgages to extract the maximum available equity from the homes. The defendants then shared the proceeds of the ill-gotten equity and the “rent” that the victim homeowners paid them. Ultimately, the victim homeowners were left with no home, no equity, and with damaged credit ratings.

Initially, the scam focused on distressed homeowners in California before expanding throughout the United States. In the course of the schemes, between January 2004 and June 2006, the defendants obtained over $90 million in fraudulent loans, caused estimated losses of over $50 million, and stole title to over 300 homes.

On December 2, 2013, McCarns was convicted after a five-week trial along with Charles Head, 36, of Pittsburgh, Pennsylvania, (formerly of Los Angeles); and Benjamin Budoff, 46, of Colorado Springs, Colorado. Head had been previously convicted in a trial in a nearly four-week trial in May 2013 with his brother Jeremy Michael Head, 34, of Huntington Beach.

This case was the product of an investigation by the Internal Revenue Service, Criminal Investigation and the Federal Bureau of Investigation. Assistant United States Attorneys Michael D. Anderson and Matthew Morris prosecuted the case.

Fourteen other defendants have been sentenced:

Elham Assadi, 39, of Irvine, sentenced to 5 years’ probation with 6 months of home detention;

Leonard Bernot, 50, of Laguna Hills, sentenced to 18 months in prison;

Akemi Bottari, 36, of Los Angeles, sentenced to 3 years’ probation with 6 months of home detention;

Keith Brotemarkle, 51, of Johnstown, Penn., sentenced to 5 years, 10 months in prison;

Benjamin Budoff, 49, Colorado Springs, Colo. sentenced to 4 years in prison;

Joshua Coffman, 37, of North Hollywood, sentenced to 20 months in prison;

John Corcoran, 61, of Anaheim, sentenced to 4.5 years in prison;

Sarah Mattson, 33, of Phoenix, Ariz., sentenced to 3 years’ probation with 3 months of home detention;

Omar Sandoval, 36, of Rancho Cucamonga, sentenced to 4 years and 10 months in prison;

Xochitl Sandoval, 37, of Rancho Cucamonga, sentenced to 8 months in prison;

Lisa Vang, 31, of Westminster, sentenced to 3 years’ probation;

Andrew Vu, 38, of Santa Ana, sentenced to 6 months in prison with 6 months of home detention;

Justin Wiley, 37, of Irvine, sentenced to 18 months in prison, and

Kou Yang, 40, of Corona, sentenced to 4 years in prison.

This case was part of the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations.

FRESNO, Calif. — Juan Carlos Martinez-Tinoco (Martinez), 42, of Mexico, pleaded guilty today to committing a depredation against public land and natural resources in the vicinity of The Needles, a series of massive granite rock formations in the Sequoia National Forest in Tulare County, Acting U.S. Attorney Phillip A. Talbert announced.

According to court documents, between March 1, 2015, and August 4, 2015, Martinez was involved in a marijuana cultivation operation consisting of approximately 2,608 marijuana plants in the Needles area of the Sequoia National Park. The operation caused extensive damage to public land and natural resources. Agents observed evidence of the use of harmful poisons, including 50-pound bags of high-nitrogen fertilizer. They also noted that many native plants and trees had been cut to make room for the marijuana plants. Large piles of trash were stuffed under boulders and buried along a stream. Water was diverted from a spring that supports wildlife. The water source for the grow site drains into the Upper Kern River, which contains the Kern River Rainbow Trout, a localized species of rainbow trout that has been designated in the state of California as a “Species of Special Concern.” Martinez has also agreed to pay $4,286 in restitution to the U.S. Forest Service to clean up the damaged area.

This case is the product of an investigation by the U.S. Forest Service, the U.S. Drug Enforcement Administration, the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the California Department of Fish and Wildlife, the Tulare County Sheriff’s Office, and the Kern County Sheriff’s Office. Assistant United States Attorney Karen Escobar is prosecuting the case.

Martinez, who is detained, is scheduled for sentencing on December 5, 2016. 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.

SACRAMENTO, Calif. — U.S. District Judge John A. Mendez sentenced Thomas Venable, 46, of Vacaville, today to one year and one day in prison for theft concerning programs receiving federal funds in connection with his operation of a sustained leave and false expenses scheme while he was a member of the California Air National Guard, Acting U.S. Attorney Phillip A. Talbert announced.

According to court documents, between April 2008 and April 2010, Venable obtained nearly $195,528 from the California Air National Guard (CA ANG) in wages, benefits, and expense reimbursements to which he was not entitled. Venable was assigned to a detail with the California Emergency Management Authority (Cal-EMA) that was available only to active duty CA ANG members. At the same time, Venable was frequently deployed for training and duty with the U.S. Air Force, and he was employed full time by the University of California-San Francisco Police Department (UCSF-PD). While deployed on federal duty or while working for the UCSF-PD between April 2008 and April 2010, Venable intentionally failed to use required military or other leave and collected double compensation from the federal government and the state of California. During the same period, Venable also filed at least 19 false travel and expense reimbursement claims that were unrelated to his CA ANG work but that were paid as though they were legitimate.

Venable also admitted that, for more than a year, he concealed from his direct supervisors at the CA ANG that he had joined the Texas Air National Guard in February 2009, resulting in Venable’s discharge from the CA ANG and his ineligibility for employment with Cal-EMA. In doing so, Venable affirmatively misrepresented his duty status to CA ANG staff.

“The California National Guard is an institution built on integrity and character,” said Maj. Gen. David S. Baldwin, Adjutant General for the California National Guard. “We applaud the U.S. Attorney's Office in its latest effort to ensure the Cal Guard remains free from fraudulent and unethical behavior.”

This case was the product of an investigation by the United States Department of Defense, Defense Criminal Investigative Service, and the California Highway Patrol, Office of Internal Affairs. Assistant United States Attorney André M. Espinosa prosecuted the case.

SACRAMENTO, Calif. — A Sacramento couple arraigned today for a grand jury indictment charging Maria Santa, 41, with failing to surrender for service of sentence and obstruction of justice, and charging Virgil Santa, 43, with harboring a fugitive, Acting United States Attorney Phillip A. Talbert announced. 

According to court documents, Maria Santa was previously sentenced to 20 months in prison for mortgage fraud and was ordered to begin serving her sentence in February 2014. When her motion for bail pending appeal was denied, she fled the jurisdiction and left a note at her residence that made it appear that she had committed suicide. On August 26, 2016, Maria Santa was arrested in Sacramento as a passenger in a vehicle her husband Virgil Santa was driving.

This case is the product of an investigation by the Internal Revenue Service-Criminal Investigation and the Federal Bureau of Investigation. Assistant United States Attorney Jared C. Dolan is prosecuting the case.

If convicted, Maria Santa and Virgil Santa face a maximum statutory penalty of 10 years in prison and a $250,000 fine as to 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.

FRESNO, Calif. — Alfonso Apu, 48, of Modesto, pleaded guilty today to conspiracy to commit mail fraud and admitted that he staged car accidents in a scheme to defraud insurance companies, Acting U.S. Attorney Phillip A. Talbert announced.

According to court documents, from at least October 2011 until August 2014, Apu conspired with at least six other individuals to stage dozens of car accidents and submit false claims to insurance companies seeking compensation. Apu and other defendants staged accidents with two or three vehicles that caused $5,000 to $10,000 in damage to each vehicle. After the staged collision, the defendants submitted a cover story to an insurer that concealed the true cause of the accident. The cover story used aliases, false identities, and false addresses for the defendants. The defendants used many different vehicles in the staged collisions by using false identities to register the vehicles and obtain insurance policies. They also recruited other individuals to allow their cars to be used in a staged accident and to make false claims under their insurance policies.

According to the plea agreement, as part of the scheme, the defendants offered to repair the recruited individual’s vehicle at automobile repair shops that they had access to or that were owned by co-defendants, usually performing cosmetic repair or none at all. It allowed them to repair damaged vehicles for an amount significantly less than the payment from an insurance company. In all, Apu caused at least $115,000 in false insurance claims.

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.

Apu is scheduled to be sentenced by U.S. District Judge Dale A. Drozd on December 12, 2016. On September 6, 2016, Cristopher Santiago Sanchez-Becerra, 32, of Stockton, pleaded guilty to the scheme and is scheduled to be sentenced on November 28, 2016. Apu and Sanchez-Becerra each face a maximum statutory penalty of 20 years in prison and a $250,000 fine. The actual sentences, 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; Oscar Diaz Landa, 46, of San Jose; Victor Hugo Soriano-Villafan, 26, of Modesto; Liobigildo Vargas, 46, of Turlock; 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.