Eastern District of California

BAKERSFIELD, Calif. — Damacio Diaz, 43, of McFarland, a detective with the Bakersfield Police Department (BPD) was arrested today, charged with abusing his position of trust as a police detective when he conspired with and assisted a narcotics dealer in the operation of the dealer’s drug organization, announced United States Attorney Benjamin B. Wagner, FBI Special Agent in Charge Monica M. Miller, DEA Special Agent in Charge John J. Martin, IRS-CI Acting Special Agent in Charge Thomas McMahon, and Bakersfield Police Chief Greg Williamson. The charges are contained in a 16-count indictment returned by a federal grand jury yesterday.

The indictment charges that Diaz, in exchange for bribes from the dealer, provided the dealer with intelligence on law enforcement practices and activities, disclosed the names and identities of police informants, tipped the dealer off as to police investigations, and attempted to provide the dealer protection from search, seizure, arrest and prosecution. The indictment also charges Diaz with bribery, retaining seized narcotics on multiple occasions for his own unlawful gain, disclosing contents of a wiretap investigation, and two counts of filing false tax returns.

Detective Diaz has been on paid administrative leave from the Bakersfield Police Department since this investigation was initiated.  He is scheduled to be arraigned today at 2:30 p.m. in Bakersfield before U.S. Magistrate Judge Jennifer L. Thurston.

U.S. Attorney Wagner stated: “When a police officer misuses his badge to commit crimes for personal profit, it is the ultimate betrayal of public trust. While it is a sad day for the Bakersfield Police Department, the department should be proud of the outstanding work it has done, together with the FBI, DEA, and IRS-CI, effectively investigating this case over the last few months.”

“No one is above the law. The alleged criminal activity put law enforcement officers at grave risk and significantly undermines public trust in law enforcement,” said Special Agent in Charge Monica M. Miller of the Federal Bureau of Investigation, Sacramento Field Office. “The FBI is committed to working with its enforcement partners to root out officers who have abused their trusted role, and we thank the Bakersfield Police Department, DEA, and IRS for their assistance with this extensive investigation.”

DEA Special Agent in Charge John J. Martin stated, “The criminal behavior alleged in this case is reprehensible. Officers take an oath to protect, serve and uphold the law. Actions like those alleged in the indictment shatter that promise and threaten the safety of fellow officers and the communities we are sworn to protect. DEA is proud to partner with the many law enforcement officers and agencies that won’t stand for criminal conduct within the ranks.”

"Law enforcement officers are held to a higher standard,” said Acting Special Agent in Charge Thomas McMahon, IRS Criminal Investigation. “Having knowledge of the laws, there is an even greater expectation to follow those laws. When individuals working in an official capacity violate the trust of their communities by abusing that power, they undermine the hard work of the entire law enforcement community.”

“I am deeply disappointed by the indictment and arrest of Bakersfield Police Detective Damacio Diaz,” said Bakersfield police Chief Greg Williamson. “The behavior and criminal activity stated in the indictment is not reflective of the commitment and awesome public service the over 500 employees of the Bakersfield Police Department provide to our community on a consistent basis.  Detectives from the department’s investigative and internal administrative divisions have worked side by side with the FBI and the U.S. Attorney’s office during the entirety of this investigation. I am proud of their work and diligence in first bringing this case forward and seeing it through to completion.”

According to count one of the indictment, from April 18, 2012, to February 20, 2015, Diaz conspired with a narcotics dealer to distribute methamphetamine. Counts two through four charge Diaz with accepting over $5,000 in bribes in each calendar year of 2012, 2013 and 2014 in return for being influenced and rewarded in connection with his official acts as a BPD police detective. Counts five through 13 charge Diaz with possession with intent to distribute methamphetamine, wherein, Diaz retained methamphetamine for his own personal gain that came into his care and control in the course of his duties as a BPD narcotics detective. Count 14 charges Diaz with the intentional disclosure of wiretap information in order to obstruct, impede or interfere with a criminal investigation. The indictment also alleges that Diaz filed false tax returns for tax years 2012 and 2013.

This case is 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 are prosecuting the case.

If convicted of the charges in the indictment, Diaz faces a maximum statutory penalty of life in prison for the conspiracy, 10 years in prison for each count of bribery, 20 years in prison to life for possession of methamphetamine with intent to distribute, five years in prison for each count of intentional disclosure of wiretap information, and three years in prison for each count of making a false income tax return. 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. — A federal grand jury returned a four-count indictment today against Michael Carey Clemans, 55, of Sacramento, charging him with a conspiracy to produce child pornography, production and receipt of child pornography, and the buying of children, United States Attorney Benjamin B. Wagner announced.

According to court documents, beginning in June 2014, Clemans conspired with a woman in the Philippines to produce child pornography. During most of the conspiracy, Clemans resided in Bangkok, Thailand, where he worked as an airline pilot. In April 2015, Clemans returned to his Sacramento residence and continued his overseas conspiracy using his Yahoo! account to chat online with the Filipino woman. In these chats, Clemans discussed various strategies to obtain minor females to engage in sexually explicit conduct. They discussed details of the photo shoots, with Clemans asking for additional photos and expressing his desire to have sex with girls as young as eight years old. Over the course of the conspiracy, Clemans paid thousands of dollars to the woman so she would orchestrate sexually explicit photo shoots of underage girls, buy photographic equipment, and rent discrete photo shoot locations, among other things. The government alleges that on multiple occasions, payments were made to the guardians of children in the Philippines in exchange for temporary custody of the children so that the child pornography could be produced. Clemans was arrested by federal authorities in July 2015.

This case is the product of an investigation by the Federal Bureau of Investigation and the Philippine National Bureau of Investigation. Special Assistant United States Attorney Josh F. Sigal is prosecuting the case.

If convicted, Clemans faces a maximum statutory penalty of life 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.

FRESNO, Calif. — Alice Pigg, 63, of Los Banos, was indicted yesterday by a federal grand jury charging her with stealing benefits paid by the United States Social Security Administration (SSA) and concealing material information from the SSA to obtain benefits, United States Attorney Benjamin B. Wagner announced.

According to the indictment, from December 2008 to June 2014, Pigg stole money paid by the SSA by failing to disclose, despite multiple inquiries from the SSA, that she lived with her husband and shared financial resources with her husband. Pigg shared a bank account that received her husband’s salary, which was at least $140,000 a year during the time period in which Pigg stole money from the SSA, and which later received his pension benefit payments. As a result, Pigg obtained SSA benefits to which she was otherwise not entitled and used them for her own personal expenses.

This case is the product of an investigation by the U.S. Social Security Administration, Office of Inspector General. Assistant United States Attorney Patrick R. Delahunty is prosecuting the case.

If convicted of stealing public money, Pigg faces a maximum statutory penalty of 10 years in prison and a $250,000 fine. If convicted of concealing material information for use in obtaining SSA benefit payments, Pigg faces a maximum statutory penalty of five 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.

FRESNO, Calif. —Juan Pedro Jimenez, 39, of Ensenada, Mexico, entered a guilty plea today to conspiring to manufacture, distribute and possess with intent to distribute, manufacturing, and possessing with intent to distribute marijuana in connection with a large-scale cultivation operation on Chowchilla Mountain in Mariposa County in the Sierra National Forest in Mariposa County, United States Attorney Benjamin B. Wagner announced.

According to court documents, Jimenez was found at the cultivation site on public land in July. Agents removed 6,919 marijuana plants from the site and found fertilizer, trash, water lines, and propane tanks. The cultivation activities caused extensive damage to the land and natural resources. Native trees and plants were cut down and steep hillsides were terraced to plant the marijuana. Water was diverted from a nearby creek to irrigate the plants. In pleading guilty, Jimenez agreed to reimburse the U.S. Forest Service for the cost of cleaning up the site.

Jimenez is scheduled for sentencing on February 1, 2016, before U.S. District Judge Lawrence J. O’Neill. He faces a mandatory minimum statutory penalty of five years in prison, a maximum of 40 years in prison and a $5 million fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

This case is the product of an investigation by the U.S. Forest Service and Mariposa County Sheriff’s Office. Assistant U.S. Attorney Karen Escobar is prosecuting the case.

SACRAMENTO, Calif. — After a five–day trial, a federal jury today found John James Kash, 52, of Redding, guilty of three counts of conspiracy to distribute marijuana, manufacturing marijuana, and conspiracy to launder money, United States Attorney Benjamin B. Wagner announced. The trial was held before United States District Judge Kimberly J. Mueller.

According to evidence presented at trial, in May 2013, Kash and his three business partners shipped approximately $700,000 worth of marijuana from Benicia, California to the Pittsburgh, Pennsylvania area. Law enforcement authorities tracked the shipment from California to Pennsylvania and watched Kash and his business partners collect the shipment from the freight company and deliver it to a warehouse outside of Pittsburgh. Authorities arrested Kash and his three co-conspirators at the warehouse. That same day, authorities executed search warrants at six separate locations associated with Kash and his business partners seizing over $1 million worth of marijuana and more than $150,000 in cash.

Three months later, after Kash and his business partners had been released from custody in Pennsylvania, law enforcement authorities executed multiple search warrants at a warehouse and residences in and around Redding. Authorities found Kash living inside a warehouse that had been converted into an active marijuana cultivation operation. Authorities seized approximately 468 growing marijuana plants from the warehouse. Meanwhile, authorities searched the residence of Kash’s co-conspirators and found processed, packaged marijuana ready for distribution as well as pay/owe ledgers reflecting marijuana cultivation and sales and several firearms.

This case was the product of an investigation by the Internal Revenue Service – Criminal Investigation, Sacramento Police Department, Pennsylvania State Police, Utah Highway Patrol, and the U.S. Drug Enforcement Administration. Assistant United States Attorneys Michele Beckwith, Justin Lee, and Christiaan Highsmith are prosecuting the case.

Kash is in custody pending sentencing. Co-defendants Glen Meyers, Aimee Burgess, and James Massery have all pleaded guilty and are in custody.

Kash is scheduled to be sentenced by Judge Mueller on February 3, 2016. Kash faces a maximum sentence of 40 years in prison and a $5 million fine on the conspiracy to distribute marijuana charge and on the manufacture of marijuana change, and 20 years in prison and a $500,000 fine or twice the value of the funds involved in the money laundering offense. 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. —Jose Javier Rosas, 62, of Bakersfield, entered a guilty plea today to aiming the beam of a laser pointer at Air-1, a Kern County Sheriff’s Office helicopter, United States Attorney Benjamin B. Wagner announced.

In pleading guilty, Rosas acknowledged that at the beginning of this year he struck and tracked Air-1 with a green laser pointer during the evening hours. As a result, the pilot experienced glare, flash blindness, significant loss of night vision, watering eyes, and eye pain and was forced to disengage from a robbery investigation.

Reports of laser attacks have increased dramatically in recent years as powerful laser devices have become more affordable and widely available to the public. In 2014, there were 3,894 reports of incidents involving laser strikes on aircraft. This year, there have been 5,530 laser incidents reported in the United States through October 23, 2015 (or more than 18 per day). In the Eastern District of California, which encompasses 34 counties, including Kern County, there were 150 reported incidents in 2014. This year, in the Eastern District of California, Bakersfield has the highest number of reported laser incidents. Lasers can completely incapacitate pilots who are trying to fly safely to their destination, endangering their crew members, passengers and people on the ground.

Rosas is scheduled for sentencing on February 1, 2016, before U.S. District Judge Lawrence J. O’Neill. Rosas faces a maximum prison term of five years and a fine of up to $250,000. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

This case is the product of an investigation by the Federal Bureau of Investigation, the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), and Kern County Sheriff’s Office. Assistant U.S. Attorney Karen A. Escobar is prosecuting this case.

SACRAMENTO, Calif. — Daniel L. Bonnett, 40, of Sacramento, was sentenced today by United States District Judge John A. Mendez to 15 years in prison, to be followed by 30 years of supervised release, United States Attorney Benjamin B. Wagner announced.

Bonnett pleaded guilty on February 10, 2015. According to court documents, between January 27, 2013, and February 14, 2013, Bonnett sent and received images depicting the sexual exploitation of children over peer-to-peer file sharing networks and by using other Internet applications. When he was arrested, he had multiple computers with thousands of images and videos of child pornography in each. When sentencing Bonnett, Judge Mendez observed that the combination of prison time and supervision will result in Bonnett effectively spending the rest of his life under observation, which Judge Mendez observed was necessary to protect the public from future crimes by Bonnett.

This case was the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI). Assistant United States Attorney Matthew Morris is prosecuting the case.

This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about Internet safety education.

SACRAMENTO, Calif. — Melvin Lee Gregory, 32, of Oroville, pleaded guilty on Tuesday to aggravated identity theft and violation the conditions of supervised release, United States Attorney Benjamin B. Wagner announced.

According to court documents, on April 2, 2015, Gregory was released from federal prison after serving a four-year sentence for a previous conviction. Between April 2, 2015, and August 22, 2015, while on probation, Gregory opened a bank account and deposited several forged checks. On August 22, 2015, Gregory was observed attempting to break into and steal U.S. Mail from a Roseville mailbox, and minutes later he successfully stole U.S. Mail from a Rocklin mailbox. When Gregory was arrested by Rocklin Police, he was in possession of stolen U.S. Mail, burglary tools, and stolen identification documents.

This case is the product of an investigation of the United States Postal Inspection Service and the Rocklin Police Department, with the assistance of the United States Probation Office in the Eastern District of California. Assistant United States Attorney Michelle Rodriguez is prosecuting the case.

Gregory is scheduled to be sentenced by United States District Judge John A. Mendez on February 23, 2016. Gregory faces at least two years in prison for his aggravated identity theft conviction and up to an additional year for his violation of conditions of federal release. 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. — After a one-day bench trial, Barry Halajian, 56, of Fresno, was found guilty of two counts of filing false liens on federal bankruptcy judges, United States Attorney Benjamin B. Wagner announced.

The District and Magistrate Judges in the Eastern District of California were recused and U.S. District Judge Stanley A. Bastian from the Eastern District of Washington heard the case. Halajian waived his right to a jury trial, and after hearing the evidence, Judge Bastian returned his verdict late Tuesday afternoon.

According to court documents and evidence presented at trial, in 2010, Halajian initiated a Chapter 7 bankruptcy proceeding in the U.S. Bankruptcy Court in Fresno. Two years later, he initiated a Chapter 9 bankruptcy proceeding in the same court. On June 29, 2012, the Chapter 9 bankruptcy was dismissed. On July 17, 2012, Halajian filed with the California Secretary of State a series of liens on the personal property of two federal bankruptcy judges in the Eastern District of California, listing them as debtors and himself as the secured party

“Filing bogus liens against federal officials for purposes of harassment is a crime,” said U.S. Attorney Wagner. “Those who commit it are asking to be prosecuted.”

This case is the product of an investigation by the Federal Bureau of Investigation. Assistant United States Attorneys Patrick Delahunty and Duce Rice are prosecuting the case.

Halajian will be scheduled for sentencing by Judge Bastian in February or March of 2016. Halajian faces a maximum statutory penalty on each count 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.

FRESNO, Calif. — A federal grand jury returned a 20-count indictment today against Rudolfo Delgadillo, 35, of Woodlake; Alejandro Zavala, 22, of Cutler; and Fabian Magana, 24, of Orosi, charging them with conspiracy to distribute and possess with intent to distribute methamphetamine and various other drug trafficking and firearms offenses. The grand jury also returned a separate eight-count indictment against Josh Soto, 34, of Salinas Valley Prison; Desarae Granillo, 22, and Salina Granillo, 24, both of Visalia, charging them with conspiring to distribute methamphetamine, distribution of methamphetamine and possession with intent to distribute methamphetamine, United States Attorney Benjamin B. Wagner announced.

The cases are the product of an investigation of the Federal Bureau of Investigation, the United States Postal Inspector Service, California Department of Justice Special Operations Unit, the Tulare County Sheriff’s Office, the Tulare Police Department, the Visalia Police Department, the Tulare Area Regional Gang Enforcement Team (TARGET), and the California Highway Patrol (CHP). Assistant United States Attorney Kimberly A. Sanchez is prosecuting both cases.

Rudolfo Delgadillo, Alejandro Zavala, Josh Soto, and Desarae Granillo are in custody. Fabian Magana and Salina Granillo have been ordered released.

If convicted, Delgadillo, Zavala, and Magana face a maximum sentence of life in prison. If convicted, Soto faces a maximum penalty of 80 years in prison, Desarae Granillo faces a maximum penalty of 220 years in prison, and Salina Granillo faces a maximum penalty of 40 years in prison. 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.

BAKERSFIELD, Calif. — A federal grand jury returned a two-count indictment today against Manuela Guadalupe Lizarraga-Hernandez, 32, of Downey, charging her with possession with intent to distribute methamphetamine and possessing a firearm in furtherance of that crime, United States Attorney Benjamin B. Wagner announced.

According to court documents, on February 15, 2015, Lizarraga-Hernandez possessed 440.9 grams of 97 percent pure methamphetamine along with a pink 9 millimeter handgun in the car that she was driving northbound through Kern County on the SR-99 highway.

This case is the product of an investigation by the Drug Enforcement Administration and the California Highway Patrol. Assistant United States Attorney Angela Scott is prosecuting the case.

If convicted, Lizarraga-Hernandez faces a maximum statutory penalty of life in prison and a $5 million 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.

FRESNO, Calif. — A federal grand jury returned a four-count indictment today against Kenneth William Kirkland, 47, of California City, charging him with being a felon in possession of firearms, a destructive device and explosives, and failing to register a destructive device in the National Firearms Registry, United States Attorney Benjamin B. Wagner announced.

According to court documents, Kirkland possessed a bomb, various explosives, and three firearms at his residence in California City.

This case is the product of an investigation by the Federal Bureau of Investigation, the California City Police Department, the Kern County Sheriff’s Office and the California Highway Patrol. Assistant United States Attorney Angela Scott is prosecuting the case.

If convicted, Kirkland faces a maximum statutory penalty of 20 years in prison and a $260,000 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. — Glenn Litton, 47, resident of Carson City, Nevada, was sentenced today by United States District Judge Morrison C. England Jr. to two years in prison for aggravated identity theft, United States Attorney Benjamin B. Wagner announced.

According to court documents, on November 19, 2014, Litton submitted an application for a U.S. passport to a passport acceptance officer in Sacramento. In the application, Litton used the identity of another individual, including that individual’s name, birthdate, and Social Security number. Litton also presented supporting documentation such as a birth certificate, a debit card, and employment ID card bearing the name of the individual whose identity he had assumed. As a result of the application, Litton was issued a U.S. passport in a false name.

This case was the product of an investigation by the U.S. State Department’s Diplomatic Security Service with assistance from the Federal Bureau of Investigation, the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), and the Nevada Department of Motor Vehicles. Assistant United States Attorney Shelley D. Weger prosecuted the case.

SACRAMENTO, Calif. — Miguel Sotelo, 41, of Sacramento, was sentenced today by United States District Judge Morrison C. England Jr. to 11 years in prison and a $25,000 fine for possessing methamphetamine with the intent to distribute it, United States Attorney Benjamin B. Wagner announced.

According to court documents, in April 2014, Sacramento County Sheriff’s detectives spotted a Honda Accord speeding northbound on Interstate 5 near Twin Cities Road in Sacramento County. Detectives stopped the car and spoke with the passenger, defendant Miguel Sotelo, who stated that the car belonged to his wife who was not present. Shortly afterward, a narcotic detection K9 unit alerted on the rear left wheel well. Officers later found more than 14 pounds of methamphetamine stored in two bags located in the car’s trunk. Officers also found $23,000 in cash.

Based on the amount of methamphetamine and currency found in the car, detectives executed a state search warrant at Sotelo’s business called “Sotelo’s Tree Care.” At the business, officers found about 266 grams of cocaine, a pistol and a digital scale.

This case was the product of an investigation by the Drug Enforcement Administration and the Sacramento County Sheriff’s Office. Special Assistant United States Attorney Josh F. Sigal prosecuted the case.

Sotelo has remained in custody since his arrest on April 9, 2014.

SACRAMENTO, Calif. — Today, United States District Judge Morrison C. England Jr. sentenced Anthony Salcedo, 34, of Fair Oaks, to five years and four months in prison for a mortgage fraud scheme. Salcedo was found guilty by a federal jury of one count of conspiracy and four counts of mail fraud after a five-day trial in June 2015.

According to court documents and evidence produced at trial, Anthony Salcedo worked in the real estate industry beginning in 2000 and was licensed as a real estate agent in 2004. He was licensed as a mortgage broker in 2006 and worked for two different mortgage lenders for five years. When selling his personal properties in 2005 and 2006, Salcedo worked with mortgage broker Sean McClendon, 49, of Fair Oaks, and Anthony Williams, 47, previously of Memphis, Tennessee, to find buyers. As an incentive to complete the sales transactions, Salcedo paid kickbacks to the buyers and to McClendon outside of escrow. Salcedo artificially inflated the value of his properties and paid the kickbacks out of the excess financing paid by the lenders who were deceived as to the true value of the purchases they were underwriting. The kickback payments were never disclosed to the lenders as part of the purchase and sale agreements, and the buyers’ income and assets were falsified in order to qualify for the loans.

In all, approximately $2.6 million in fraudulently obtained loans were involved in the scheme, while Salcedo and his family got out from under their $1.6 million in mortgage debt and made over $600,000 of profit at a time when Salcedo knew the real estate market was slowing down. Salcedo was remanded to the custody of the U.S. Marshals after the verdict, and has been awaiting sentencing in the Sacramento County Jail since that time.

According to a Sentencing Agreement on file with the Court, after trial the government’s continuing investigation indicated Salcedo might be hiding assets and manufacturing a drug problem in an effort to avoid restitution payments and influence the amount of time he ultimately served in prison. To resolve those issues, Salcedo agreed the Court need not consider his purported drug problem, which may have qualified him for a drug treatment program and a reduction of his sentence. He also agreed to repay the United States Federal Defenders for the costs of his defense, make a $300,000 payment toward a total restitution obligation of over $700,000, and pay a $50,000 fine before sentencing.

In sentencing Salcedo, Chief Judge England noted, “You really believed that you were going to beat the system. You’re not smarter than everyone else in the world.”

“Anthony Salcedo was a licensed real estate professional who decided to game the system so that he could profit in the midst of the then looming financial crisis, to which his actions contributed,” said U.S. Attorney Wagner. “We are gratified by the sentence imposed by the Court, which should serve as notice that mortgage fraud remains a serious offense for which there can and should be severe consequences.”

“Beyond the dishonesty and collusion involved, this is significant because of the exchange of money outside of escrow,” said Thomas McMahon, Acting Special Agent in Charge, IRS Criminal Investigation. “Through kickbacks, the defendant and his family managed to avoid $1.6 million in mortgage debt while a few buyers declared bankruptcy and not only lost their investment properties but also their homes. IRS-CI is committed to hold accountable those involved in these types of schemes.”

Co-defendant McClendon pleaded guilty and was sentenced on November 5, 2015, to 20 months in prison. He is expected to begin serving that sentence in January 2016. Co‑defendant Williams pleaded guilty, and is currently serving his sentence of two years and nine months in prison.

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 Jean M. Hobler and Marilee Miller prosecuted the case.

SACRAMENTO, Calif. — Thomas Venable, 46, of Vacaville, pleaded guilty today to theft concerning programs receiving federal funds in connection with his operation of a sustained leave and false expenses scheme while he was a Major in the California Air National Guard, United States Attorney Benjamin B. Wagner 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.

This case is 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 is prosecuting the case.

Venable is scheduled to be sentenced by U.S. District Judge John A. Mendez on February 16, 2016. Venable 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.

FRESNO, Calif. — After a three-and-a-half week trial, a federal jury in Fresno has found four defendants guilty of participating in a tax refund scheme claiming more than $33 million in federal tax refunds, United States Attorney Benjamin B. Wagner announced.

Fresno residents Gaylene Lynette Bolanos,58; and Leroy Donovan Combs, 74; Madera County resident Charles Wayne Uptergrove, 57; and Ladonna Lee Moon, 55, of Texas, were convicted of submitting false claims against the United States. Bolanos was also found guilty of conspiracy to defraud. The jury was unable to reach a verdict as to Rodney Edwin Moon, of Texas.

Prior to trial, co-defendants James Karam Schwartz, 60, and Louie Calles, 65, pleaded guilty to submitting false claims against the United States. Another co-defendant, Oswald Georgner, 66, of Fresno, pleaded guilty to the conspiracy to defraud. Each of the defendants is awaiting sentencing.

According to court documents and testimony at trial, between August 2008 and October 16, 2008, Bolanos and Georgner conspired to submit false claims for income tax refunds. Bolanos and Georgner worked with others, including Combs, Uptergrove, Calles, Schwartz, and Ladonna Lee Moon to submit false tax returns in an attempt to eliminate their debts and receive sizable tax refunds by submitting their tax returns with false claims of interest income and withholding citing IRS Form 1099-OID.

As part of the scheme, the defendants submitted false tax returns to the IRS seeking more than $33 million in fraudulent tax refunds. As a result of these fraudulent tax refund claims, the IRS issued approximately $400,000 in fraudulent refunds. The tax returns were fraudulent because the defendants listed their debts, bills, and other non-income items as interest income. The defendants then claimed that almost all of that interest income had been withheld and paid to the IRS, even though none of the purported interest income was ever withheld. Based on the reported withholdings, the defendants claimed they were owed millions of dollars in refunds by the IRS.

“These defendants went well beyond cheating on their taxes to avoid paying their fair share,” said U.S. Attorney Wagner. “They sought to steal millions in taxpayer funds meant to provide services for us all. We are pleased by the jury’s verdict and we will continue our efforts to bring to justice those who would plunder the public fisc.”

“Plain and simple, this was fraud,” said Acting Special Agent in Charge Thomas McMahon, IRS Criminal Investigation. “Today’s conviction should send a clear message that those involved in these schemes will not go undetected. It is more important than ever that the American people feel confident that everyone is playing by the rules and paying the taxes they owe.”

This case is the product of an investigation by the Internal Revenue Service‑Criminal Investigation. Assistant United States Attorneys Grant B. Rabenn and Henry Z. Carbajal III are prosecuting the case with assistance from Trial Attorney Karen J. Sharp, of the Department of Justice, Antitrust Division.

The four defendants convicted at trial are scheduled to be sentenced my United States District Judge Anthony W. Ishii on March 7, 2016. They face a maximum statutory penalty of five years in prison on each false claims charge. Bolanos and Georgner face a maximum statutory penalty of 10 years in prison for the conspiracy charge. 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. — A federal jury found two defendants guilty today of mail fraud and making false statements on loan applications in a scheme that provided financial incentives to straw buyers to get them to purchase homes that developers were having difficulty selling, United States Attorney Benjamin B. Wagner announced.

Edward Khalfin, 58, of San Mateo, was found guilty of 12 counts of mail fraud and 11 counts of making false statements on loan applications. Robin Dimiceli, 53, of Brentwood, was found guilty of six counts of mail fraud and six counts of making false statements on loan applications.

According to court documents, from August 2006 through May 2008, two brothers, Volodymyr Dubinsky, 56, formerly of Folsom, and Leonid Doubinski, 50, formerly of Copperopolis, built, developed, and sold real estate in Carmichael, Sacramento, and Copperopolis. As the real estate market declined, the brothers recruited family members, employees, and associates with good credit to act as straw buyers for residential properties. The Dubinsky brothers have not been apprehended and are fugitives thought to be residing in Ukraine.

Khalfin was a licensed mortgage broker; his company was called Bay Financial Co.  Dimiceli was a licensed real estate salesperson and was self-employed at Trinity Mortgage Capital, which was affiliate with Windsor Mortgage Capital. Khalfin and Dimiceli assisted in the scheme by submitting the loan applications for the straw buyers. They allegedly prepared and submitted applications to lenders that falsely stated the straw buyers’ income, assets, and intent to occupy the homes as their primary residences. Dimiceli was a straw buyer for at least two properties involved in the scheme.

This case is the product of an investigation by the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigation. Assistant United States Attorneys Todd A. Pickles and Roger Yang are prosecuting the case.

Three other indictments were brought relating to this scheme. Four defendants have pleaded guilty and are scheduled to be sentenced: Svetlana Dubinsky, 51, of Boca Raton, Fla.; Serge Doubinski, 32, of San Francisco; Zinayda Chekayda, 52, of Antelope, (docket # 2:12-cr-327 WBS); and Kory Schmidli, 37, of Linden (docket # 2:12-cr-330 GEB). A trial is pending for Diana Woods, 58, of Citrus Heights, on March 8, 2016 (docket # 2:12-cr-329). Volodymyr Dubinsky and Leonid Doubinski are fugitives. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.

Sentencing is set for Khalfin and Dimiceli for February 1, 2016, by United States District Judge William B. Shubb. The defendants face a maximum statutory penalty of up to 20 years in prison and a $250,000 fine for mail fraud and 30 years in prison and a $1 million fine for false statements on a loan or credit application. 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. — Michael David Wilson, 32, of Delano, was sentenced late Monday afternoon by Senior United States District Judge Anthony W. Ishii to six and a half years in prison for receiving and distributing child pornography, United States Attorney Benjamin B. Wagner announced.

According to court documents, between September 2012 and April 2013, Wilson received and distributed more than 1,400 images and video files depicting minors engaged in sexually explicit conduct. The illicit files also involved the portrayal of sadistic, masochistic, and other depictions of violence, and included depictions of prepubescent minors. On July 25, 2013, Wilson was charged with receiving and distributing child pornography, and he pleaded guilty to the charge on August 27, 2014.

“The actions of child predators cause irreparable harm to children across our nation,” said Ryan L. Spradlin, special agent in charge for HSI San Francisco. “The victims of these criminals deserve outcomes like today. With the tireless efforts made by HSI and our law enforcement partners, we will continue to hunt down predators and hold them accountable for their disturbing actions.”

This case was the product of an investigation by the Bakersfield office of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI). Assistant United States Attorney Brian W. Enos prosecuted the case.

FRESNO, Calif. — Larry Ramirez, 52, of Tulare, pleaded guilty today to stealing benefits paid by the United States Social Security Administration (SSA), United States Attorney Benjamin B. Wagner announced.

According to court documents, Ramirez failed to disclose income he had made from owning and operating an auto body repair business in numerous applications to the SSA for benefits. During the process of determining his benefits, he made a false statement to the SSA that he had not worked in over 15 years, which he knew to be false at the time. As a result, and over the course of approximately 15 years, Ramirez stole approximately $90,000 in SSA benefits.

This case is the product of an investigation by the U.S. Social Security Administration, Office of Inspector General. Assistant United States Attorneys Patrick R. Delahunty and Henry Z. Carbajal III are prosecuting the case.

Ramirez is scheduled to be sentenced by United States District Judge Anthony W. Ishii on March 28, 2016. Ramirez 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. — Matthew Luke Gillum, 32, of Meadow Vista, was sentenced today by United States District Judge Morrison C. England Jr. to nine years in prison for conspiring to distribute marijuana and avoiding a currency transaction reporting requirement, United States Attorney Benjamin B. Wagner announced.

According to court documents, Gillum, was the leader of a drug trafficking organization (DTO) that operated in the greater Sacramento area. The Gillum DTO shipped marijuana through the United States mail to various locations outside of California. In order to conduct his drug trafficking operation, Gillum solicited, hired, and utilized the services of at least five individuals to open post office boxes, collect drug trafficking proceeds, ship marijuana parcels, manufacture and supply marijuana, and facilitate the clandestine communications of the DTO.

The Gillum DTO solicited marijuana orders via the Silk Road website. Marijuana purchasers shipped cash payments to various post office boxes controlled by the Gillum DTO throughout the Sacramento region. Once payment was received, the Gillum DTO would ship the selected type and quantity of marijuana to the purchaser. Between August 2012 and July 2013, the Gillum DTO distributed at least 600 pounds of marijuana, much of it through Express Mail parcels sent from the Sacramento region to 16 different states. During the course of the investigation, the United States seized over $700,000 from a bitcoin account controlled by Gillum.

On February 27, 2013, Gillum purchased a diamond ring from Tiffany and Co. for $105,900 in cash. Because the transaction involved more than $10,000 in cash, Tiffany was required to file an IRS Form 8300 (Report of Cash Payments Over $10,000 Received in a Trade or Business) in Gillum’s name. However, although Gillum paid for the ring, he used a nominee to fill out the paperwork as if the nominee purchased the ring.

This case was the product of an investigation by the United States Postal Inspection Service, the Internal Revenue Service-Criminal Investigation, the Sacramento County Sheriff’s Office, the Central Valley HIDTA Task Force, CAL-MET, Placer County Special Investigations Unit, and Rocklin Police Department. Assistant United States Attorneys Justin Lee and Kevin Khasigian prosecuted the case.

SACRAMENTO, Calif. — A Yuba City man pleaded guilty today to producing child pornography, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Benjamin B. Wagner of the Eastern District of California, Special Agent in Charge Ryan Spradlin of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI) San Francisco Field Division, and Chief of Police Robert D. Landon of the Yuba City Police Department.

Nathan Penner, 25, pleaded guilty today before United States District Judge Troy L. Nunley to one count of production of child pornography. The sentencing hearing is set for January 21, 2016.

In connection with his plea, Penner admitted that he produced sexually explicit photos and videos of a five-year-old girl in September and October of 2012. Penner further acknowledged that he had downloaded child pornography. Subsequent forensic analysis of Penner’s computer and digital media revealed both the child pornography that he produced and hundreds of other child pornography files.

This case is being investigated by HSI and the Yuba City Police Department. This case is being prosecuted by Trial Attorney Reginald E. Jones of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Special Assistant U.S. Attorney Josh F. Sigal of the Eastern District of California. CEOS’ High Technology Investigative Unit assisted with computer forensic analysis for the case.

Penner faces a maximum statutory penalty of 30 years in prison and a $250,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. 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 via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

SACRAMENTO, Calif. — As part of the ongoing effort by U.S. Attorney’s Office to prosecute mortgage fraud, three defendants were sentenced today for their roles in separate mortgage fraud schemes, United States Attorney Benjamin B. Wagner announced.

West Sacramento Man Sentenced for Mortgage Fraud (2:11-cr-353 MCE)

United States District Judge Morrison C. England Jr. sentenced Sean McClendon, 49, of Elk Grove, today to one year and eight months in prison. On October 18, 2012, McClendon pleaded guilty to a conspiracy to commit mail fraud for his involvement in a Sacramento area mortgage fraud scheme with Anthony Salcedo and Anthony Williams. According to court documents, McClendon and Williams recruited straw buyers to purchase four properties owned by Salcedo or his associates using kickbacks, false financial information for the buyers, and payments outside of escrow. All properties involved were foreclosed by the lenders, resulting in losses of over $1 million. In June 2015, a jury found Salcedo guilty of four counts of mail fraud and one count of conspiracy to commit mail fraud. He is scheduled to be sentenced on November 12, 2015. On January 29, 2015, Williams was sentenced to two years and nine months in prison.

This case is the product of an investigation by the Internal Revenue Service – Criminal Investigation and the Federal Bureau of Investigation. Assistant United States Attorneys Jean M. Hobler and Marilee Miller are prosecuting the case.

Mortgage Broker Sentenced for False Statements on a Loan Application (2:13-cr-131 MCE)

United States District Judge Morrison C. England Jr. sentenced Valeri Kalyuzhnyy, 44, of Citrus Heights, to two years in prison. On June 25, 2015, Kalyuzhnyy pleaded guilty to making a false statement on a loan application. According to court documents, Kalyuzhnyy, while working as a mortgage broker, bought two homes using the credit information of a straw buyer. The loan applications that were used to secure the properties contained numerous false statements regarding the buyer’s intent to occupy the property, employer, occupation, and monthly income. In order to support the inflated monthly income listed on the loan application, fraudulent tax returns were submitted. On July 17, 2007, Kalyuzhnyy gave the straw buyer a check for $29,000.

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

San Joaquin County Man Sentenced for Mortgage Fraud Scheme (2:11-cr-468 TLN)

United States District Judge Troy L. Nunley sentenced Stephen Pirt, 37, of Mountain House, to two years and one month in prison for his participation in a large-scale mortgage fraud scheme. According to evidence presented at the trial for co-defendant Erik Hermann Green, 33, of Roseville, Pirt and Green defrauded the New Century Mortgage Company by submitting false documentation about borrowers’ employment, income and assets, including fraudulent loan applications and other altered bank documents. On September 19, 2013, Stephen Pirt pleaded guilty to wire fraud.

Judge Nunley told Pirt, “You were an organizer and leader of the scheme, and you need to be punished for that.” The judge also explained the need for a proper deterrent effect.

Green is scheduled to be sentenced by Judge Nunley on November 19, 2015. Green 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.

This case is the product of an investigation by the Internal Revenue Service – Criminal Investigation and the Alameda County District Attorney’s Office. Assistant United States Attorney Michael D. Anderson and Special Assistant United States Attorney Josh F. Sigal are prosecuting the case.

SACRAMENTO, Calif. — A Sacramento couple was sentenced today by United States District Judge Troy L. Nunley for a smash and grab vehicle burglary in South Sacramento, United States Attorney Benjamin B. Wagner announced.

Keo Seng Saechao, 33, was sentenced to 21 months in prison, and his wife Pang Shoua Xiong, 33, was sentenced to 30 months in prison.

According to court documents, on September 26, 2012, a postal vehicle was burglarized in South Sacramento. The back window of the vehicle was smashed in with a tire iron and all of the mail in the truck was stolen. At the time of the burglary, 531 postal customers were left on the route. Saechao was driving the car during the burglary and Xiong was in the front seat.

On October 11, 2012, California Probation officers and CHP officers conducted a probation search of the defendants’ home as part of an unrelated investigation. They found evidence linking the couple to the postal vehicle burglary, as well as numerous other instances of mail theft in the South Sacramento area. A second search turned up large piles of stolen mail from the addresses that would have been in the vehicle in South Sacramento on September 26, 2012. A search of the computers in the apartment showed false IDs with the defendants’ pictures superimposed on it, “Check Designer” software that allows users to create and print checks, and the names and account numbers associated with several of the fraud victims whose identifiers were found on papers in the apartment.

On July 30, 2015, Saechao and Xiong pleaded guilty to theft of the mail.

This case is the product of an investigation by the U.S. Postal Inspection Service. Assistant United States Attorney Matthew Morris prosecuted the case.

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 to arrest and prosecute the individuals responsible for the theft of U.S. Mail and damage to Postal property and equipment.

SACRAMENTO, Calif. — Gregory Scott Baker, 48, of Newcastle, pleaded guilty today to conspiring commit mail and wire fraud, conspiring to launder monetary instruments, and filing a false tax return, United States Attorney Benjamin B. Wagner announced.

In August 2012, Baker, Bart Wayne Volen, 54, of San Diego and Haiku, Hawaii, and Darrell Patrick Hinz, 48, of Cameron Park, were charged with conspiring to commit mail and wire fraud and various money laundering charges as part of a scheme to defraud the United Auburn Indian Community (UAIC) of more than $17 million. In April, 2013, the government filed a superseding indictment which additionally charged Baker with filing false tax returns from 2006 through 2009 in connection with the fraud.

According to court documents, in October 2006, the UAIC hired Volen, a developer, to finish construction on four tribal buildings – a school, a community center, and administrative offices – on UAIC-owned property in Auburn. Volen submitted false and inflated invoices to the UAIC knowing that Baker and Hinz, both UAIC employees, would approve the fraudulent invoices based on an agreement the three men had reached earlier. 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, and his duties included overseeing the Indian Hills Office Project. 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 pay for work done on the Project. The indictment alleges that during the scheme to defraud the tribe, Baker engaged in conduct to insure that the tribal council would pay for the inflated and fraudulent invoices submitted by Volen. He was aware of what Volen was doing and was later paid by Volen for his participation in the scheme. According to court documents, a total of over $17 million was ultimately stolen from the UAIC, and Baker received over $1.4 million for his participation.

With regard to the tax offense, according to court documents, Baker filed tax returns contained a Schedule C in which Baker failed to report the income he derived from the scheme. As a result, the United States suffered a tax loss of between $250,000 and $550,000.

This case is 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 are prosecuting the case.

Hinz is scheduled for trial in Sacramento on February 29, 2016. The charges against him are only allegations; Hinz is presumed innocent until and unless proven guilty beyond a reasonable doubt.

Baker is scheduled to be sentenced by United States District Judge Troy L. Nunley on March 17, 2016. Volen previously pleaded guilty to similar charges in this case on June 12, 2014. Chris W. Eatough, the owner of Sequoia Pacific Builders, previously pleaded guilty to a felony related to this case on June 20, 2013, in case number 2:13-cr-214 TLN. Volen and Eatough are scheduled to be sentence by Judge Nunley on April 28, 2016 and March 17, 2016, respectively. Both Baker and Volen have agreed to pay at least $17 million in restitution to the United Auburn Indian Community.

Baker faces a maximum sentence of 20 years in prison and a $250,000 fine, or twice the value of the gross gain or loss for conspiring to commit mail and wire fraud. The maximum statutory penalty for conspiring to launder monetary instruments is 20 years in prison and a $500,000 fine or twice the value of the laundered money Any sentence imposed in this case, however, 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.

SACRAMENTO, Calif. — Leticia A. Roque, 48, of Vallejo, pleaded guilty today to conspiring to submit false claims against the United States and aggravated identity theft, United States Attorney Benjamin B. Wagner 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 partner in law enforcement on this investigation and will continue to protect the public and the U.S. Mail against all forms of misuse.”

“IRS Criminal Investigation has made investigating refund fraud and identity theft a top priority,” said Acting Special Agent in Charge Thomas McMahon, IRS-Criminal Investigation. “Filing fraudulent tax returns in the names of other individuals may result in significant harm to those individuals whose identities were stolen, as well as a monetary loss against the U.S. Treasury.”

According to court documents, between January 7, 2012, and May 19, 2012, Roque along with co-defendants Marcus A. Cooper, 29, and Tiana E. Naples, 28, also of Vallejo, submitted at least 60 fraudulent tax returns to the Internal Revenue Service. The returns were filed in other people’s names and contained false representations about those persons’ income, employer, tax credits, and tax withholding. The returns were filed without the permission or knowledge of the taxpayers. The 60 tax returns requested approximately $209,713 in tax refunds, of which approximately $102,521 was sent to the defendants in the form of prepaid debit cards.

This case is the product of an investigation by the United States Postal Inspection Service and the Internal Revenue Service – Criminal Investigation. Assistant United States Attorney Matthew G. Morris is prosecuting the case.

Roque is scheduled to be sentenced on February 9, 2016, by United States District Judge John A. Mendez. She faces a maximum statutory penalty of 10 years in prison and a $250,000 fine for the false claim conviction and a mandatory consecutive two-year term for aggravated ID theft. 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.

Cooper and Naples are scheduled to appear in court for a status conference on December 8, 2015. The charges against them are only allegations; they are presumed innocent until and unless proven guilty beyond a reasonable doubt.

FRESNO, Calif. — United States District Judge Anthony W. Ishii sentenced the final two defendants on Monday for a conspiracy to sell multiple pounds of methamphetamine to a confidential source, United States Attorney Benjamin B. Wagner announced.

On Monday, Veronda Creasy, 32, was sentenced to five years in prison, and Juventino Galindo, 41, was sentenced to eight years and nine months in prison for conspiracy to distribute and possess with intent to distribute methamphetamine.

On October 19, 2015, Touch Peang, 35, was sentenced to 12 years in prison for conspiracy to distribute methamphetamine and marijuana. Bruce Hunt, 60, was sentenced on October 13, 2015, to four years in prison for using a telephone to facilitate the commission of a felony. All defendants pleaded guilty in July and August 2015.

According to court documents, on April 29, 2014, Creasy and Hunt arranged to sell methamphetamine to a confidential source who wanted to purchase 10 pounds. Creasy sought the assistance of Galindo to obtain the substantial quantity of methamphetamine and Galindo arranged for Peang to sell the methamphetamine. On May 1, 2014, Hunt called the confidential source to notify him that the methamphetamine was available. Galindo, Creasy and Hunt led the confidential source to Peang’s place of employment, where Peang showed the methamphetamine to him. Shortly thereafter, officers of the Fresno Police Department executed a search warrant at the location, resulting in the arrest of the defendants and the seizure of eight pounds of methamphetamine, 13 pounds of marijuana, and two firearms.

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 at the Fresno Police Department on this investigation and will continue to protect the public and the U.S. Mail against all forms of criminal misuse.”

This case was the product of an investigation by the United States Postal Inspection Service and the Fresno Police Department. Assistant United States Attorney Melanie L. Alsworth prosecuted the case.

SACRAMENTO, Calif. — The Office of the United States Attorney for the Eastern District of California announced today that it is seeking applications for two Reentry and Prevention Outreach Coordinators to work in the Sacramento and Fresno offices to help in the development and implementation of the U.S. Department of Justice’s Smart on Crime initiative.

The selected applicants will focus on reentry and prevention efforts as part of the office’s implementation of the Smart on Crime Initiative. Supporting effective crime prevention strategies and working to reduce recidivism among persons who have paid their debt to society and are rehabilitating and reintegrating back into their communities are key components of the initiative. Recidivism rates for offenders leaving prison are high. A reduction in the recidivism rate of even one or two percentage points can create long-lasting benefits for formerly incarcerated individuals and their communities.

“This office’s main function is, and will remain, the prosecution of serious and violent offenders,” said U.S. Attorney Wagner. “But prosecutions alone will not ensure public safety over the long term. This office has been increasing its involvement in community-based crime prevention and reentry strategies. I am very pleased that we are now hiring dedicated professionals to help lead these efforts. When hired, these persons should bring new expertise to this office, increasing our capacity to assist in prevention and reentry, while minimizing the impact on our prosecutorial resources.”

In 2013, then Attorney General Eric Holder launched a comprehensive review of the criminal justice system in order to identify reforms that would ensure federal laws are enforced more fairly and more efficiently. This review was part of the Department of Justice’s Smart on Crime Initiative, which has five principal goals: 1) ensuring that finite federal resources are devoted to the most important law enforcement priorities; 2) promoting fairer enforcement of the laws and alleviating disparate impacts of the criminal justice system; 3) ensuring just punishments for low-level, nonviolent convictions; 4) bolstering reentry and prevention efforts to deter crime and reduce recidivism; and 5) strengthening protections for vulnerable populations.

Since the initiative’s announcement, the U.S. Attorney’s Office for the Eastern District has worked with our federal, state, and local law enforcement partners to focus our federal prosecutions on those crimes and criminals in our district that pose the greatest threats to our citizens and involve clear federal interests. To support the implementation of the reentry and prevention aspects of the initiative, the office sought and was awarded funding for two specialist positions. The Reentry and Prevention Outreach Coordinators will help the office to engage with youth and with at-risk populations to help prevent criminal activity, and they will also work with other agencies to support programs and strategies to facilitate the reentry of convicted persons into our communities in ways that maximize their chances of becoming productive citizens. It is anticipated that one coordinator will be based in the Sacramento office and one in the Fresno office.

The job postings for the Reentry and Prevention Outreach Coordinator positions can be found at: https://www.usajobs.gov/GetJob/ViewDetails/420327700 for Sacramento and https://www.usajobs.gov/GetJob/ViewDetails/420328700 for Fresno.

Additional information on the Department of Justice’s Smart on Crime initiative can be found at: http://www.justice.gov/sites/default/files/ag/legacy/2013/08/12/smart-on-crime.pdf.

The President, appearing in Newark, New Jersey today, announced a range of actions to promote rehabilitation and reintegration of formerly incarcerated persons. That announcement can be found at: https://www.whitehouse.gov/the-press-office/2015/11/02/fact-sheet-president-obama-announces-new-actions-promote-rehabilitation.

The United States Government does not discriminate in employment on the basis of race, color, religion, sex, national origin, political affiliation, sexual orientation, marital status, status as a parent, genetic information, disability, age, membership or nonmembership in an employee organization, or on the basis of personal favoritism.

FRESNO, Calif. —Uriel Silva-Garcia (Silva), 24, of Turicato, Michoacán, Mexico, pleaded guilty today to conspiring to manufacture, distribute and possess with intent to distribute marijuana and possessing firearms in furtherance of a large-scale cultivation operation located near Little Poso Creek in the Sequoia National Forest, United States Attorney Benjamin B. Wagner announced.

According to court documents, Silva was paid to plant and tend about 8,596 marijuana plants on public land. To facilitate the cultivation activities, Silva possessed a loaded rifle and handgun. The cultivation caused extensive damage to the land and natural resources. Native trees and plants were cut down and steep hillsides were terraced to plant the marijuana. Pesticides, including malathion, fertilizer, water lines, trash, clothing and camping equipment were scattered throughout the site. Silva has agreed to reimburse the U.S. Forest Service for the cleanup costs.

Co-defendant Antonio Garcia-Villa, 46, pleaded guilty on October 26, 2015. Both defendants are scheduled to be sentenced on January 19, 2016, by Senior U.S. District Judge Anthony W. Ishii. They face a maximum statutory penalty of 20 years in prison and a $1 million fine for the drug conspiracy and a mandatory minimum consecutive term of five years in prison for the firearm charge. The actual sentences, however, 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. They also face deportation to Mexico upon completion of any prison term imposed.

This case is 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 the Kern County Sheriff’s Office. Assistant United States Attorney Karen Escobar is prosecuting the case.

FRESNO, Calif. — A federal grand jury returned a four-count indictment today against Armando Arnoldo Martinez-Tinoco, 36; his brother, Juan Carlos Martinez-Tinoco, 41; and Luis Enrique Flores, 23, all of Mexico; and Ivan De Jesus Jimenez, 30, of La Puente, California, charging them with a conspiracy to cultivate marijuana on public land, cultivating and possessing marijuana with intent to distribute, and damaging public land and natural resources, United States Attorney Benjamin B. Wagner announced.

According to court documents, on October 17, 2015, law enforcement officers entered the marijuana cultivation site that was near The Needles, a series of massive granite spires atop a ridge in the Sequoia National Forest in Tulare County. The defendants fled the grow site, but were later found in the Kernville and Weldon areas. Agents removed 2,608 marijuana plants from the site and found highly toxic chemicals, fertilizer, and trash strewn throughout. The cultivation activities caused extensive damage to the land and natural resources. Native trees and plants were cut down to make room for the marijuana. Water was diverted from a spring that supports a dwindling breed of indigenous trout, the Kern River Rainbow Trout.

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.

The defendants are scheduled for arraignment on November 2, 2015, in Fresno. If convicted of the drug offenses, the defendants face a maximum statutory penalty of 20 years in prison and a $1 million fine. If convicted of the environmental crime, the defendants face a maximum statutory penalty of 10 years in prison, a $250,000 fine, and restitution. 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. —Martin Wayne Flanders, 51, formerly of Roseville, was sentenced today by United States District Judge Troy L. Nunley to six years and five months in prison for a scheme that targeted distressed homeowners, United States Attorney Benjamin B. Wagner announced.

In February 2015, Flanders and his wife Ligia Sandoval Spafford (Sandoval), 48, of Roseville, pleaded guilty to mail fraud for their participation in the fraud scheme.

According to court documents, between 2008 and 2010, Flanders charged clients advance fees in exchange for a number of financial services, including loan modifications, mortgage loan audits, credit repair, debt relief, bankruptcy filings, and a program to sell homes to “investors” with a rent-to-own option. Flanders and Sandoval marketed these services to economically distressed homeowners with particular emphasis on those who were Spanish speakers. During a radio program aired twice weekly by a Bay Area Spanish‑language Christian radio station, Radio Luz, Sandoval promoted the services she and Flanders offered. Flanders also advertised on a Spanish-language television station, Univision, and in Spanish-language magazines. About 98 percent of the defendants’ clients were of Hispanic descent, some of whom spoke little to no English. Sandoval speaks Spanish, Flanders does not.

Flanders and Sandoval made numerous false statements to investors as to the success of the programs being offered or refunds that would be available if the programs were not successful. “Ghost offers” – i.e., fictitious offers to purchase the victim’s property through short sale – and “skeleton bankruptcies” – i.e., sham bankruptcy petitions that were quickly dismissed by the bankruptcy court – were also used by Flanders or Sandoval to try to stall the foreclosure process. At least 25 to 30 individuals paid for services and did not receive them or did not receive refunds when the programs failed to deliver as promised. The total loss to the victims is at least $125,000. Some homeowners who were not able to obtain relief were foreclosed upon by their lenders.

“By targeting people in financial distress with limited English proficiency, Flanders sought to enrich himself on the backs of those who could least afford it,” said United States Attorney Wagner. “We are gratified by the sentence imposed by the Court, and we will continue to focus our efforts on the prosecution of such predatory fraud schemes.”

This case is the product of an investigation by the Federal Bureau of Investigation. Assistant U.S. Attorneys Todd A. Pickles and Shelley Weger are prosecuting the case.

Flanders has been detained since his arrest in October 2012. Sandoval is currently out of custody. Sandoval is scheduled to be sentenced by Judge Nunley on March 3, 2016.  She 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.

FRESNO, Calif. — James Steven Harris, aka Steve Harris, 45, of Loma Linda, was sentenced today to two years and six months in prison for his involvement in smuggling smokeable synthetic cannabinoids, commonly known as “spice,” “K2, or “incense,” to his brother who was then an inmate of Taft Correctional Institution, United States Attorney Benjamin B. Wagner announced.

On August 10, 2015, Steve Harris sentence pleaded guilty to two counts of making false statements under penalty of prosecution on Federal Bureau of Prisons visitor forms that he was not in possession of contraband, knowing that he was in possession of smokeable synthetic drugs containing XLR11. According to court documents, on one occasion Steve Harris successfully smuggled 15.5 grams of XLR11 into TCI for his brother Tracy McArthur Harris, aka Trey Harris, 42, and later attempted to smuggle 34.3 grams of XLR11, along with four packages of rolling papers, into the prison. At the time, XLR11 was a controlled substance analogue, which has since been made a Schedule I controlled substance.

At sentencing, United States District Judge Anthony W. Ishii stated: “The serious nature of smuggling contraband into a federal prison has serious consequences.”

Tracy Harris was subject to a prison disciplinary proceeding that added more time to his current 11-year prison term that he is currently serving for a drug conspiracy conviction. He was also sentenced in May to a consecutive one-year prison term for his involvement in obtaining the synthetic drugs from his brother. Court documents indicate that Tracy Harris, in turn, distributed the drug to other inmates at Taft.

A report by the Office of the Inspector General of the U.S. Department of Justice found that drugs reach federal prisoners primarily through inmate visitors.

This case was the product of an investigation by the Federal Bureau of Investigation and the Special Investigative Supervisor’s Office of Taft Correctional Institution. Assistant United States Attorney Karen A. Escobar prosecuted the case.

FRESNO, Calif. — Johnny Alexander Quenga, 28, of Fresno, Calif., entered a guilty plea today to aiming the beam of a laser pointer at Air 1, a Fresno Police helicopter, United States Attorney Benjamin B. Wagner announced.

In pleading guilty, Quenga acknowledged that he repeatedly struck Air 1 with a powerful green laser attached to an airsoft rifle. As a result, the airmen experienced visual interference, flash blindness, after-imaging, a persistent headache lasting several hours, and dizziness. Two Fresno Police officers, who were responding to calls to assist in the investigation of the laser incident, were also seriously hurt when their patrol vehicle was broadsided at a busy intersection in northeast Fresno.

Quenga is scheduled for sentencing before Senior U.S. District Judge Anthony W. Ishii on January 19, 2016. He faces a maximum statutory penalty of five 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. At his change of plea hearing, Quenga was remanded to the custody of the U.S. Marshals Service for failing to comply with conditions of his pretrial release.

Reports of laser attacks have increased dramatically in recent years as powerful laser devices have become more affordable and widely available to the public. In 2014, the Federal Aviation Administration received 3,894 reports of incidents involving laser strikes on aircraft. In the Eastern District of California, which encompasses 34 counties in the eastern portion of California, there were 150 reported incidents, with the majority in Bakersfield, Fresno, and Modesto. Lasers can completely incapacitate pilots who are trying to fly safely to their destination, endangering their crew members, passengers and people on the ground.

The case against Quenga was investigated by the Federal Bureau of Investigation and Fresno Police Department. Assistant U.S. Attorney Karen A. Escobar is prosecuting the case.

FRESNO, Calif. — Two men from Michoacán, Mexico faced court action today for their involvement in growing marijuana in national forests, United States Attorney Benjamin B. Wagner announced.

In the first case, Jose Antonio Reyna-Chavez (Reyna), 20, of was sentenced today to six years in prison for conspiring to manufacture, distribute, and possess with intent to distribute marijuana and possessing a firearm in furtherance of a drug trafficking crime. Upon completion of his prison term, Reyna is subject to deportation to Mexico.

On August 10, 2015, Reyna pleaded guilty to his involvement in the cultivation of 1,539 marijuana plants in the Blue Canyon area of the Sierra National Forest. He also acknowledged that he possessed a firearm in furtherance of the drug conspiracy. The cultivation operation was close to recreation areas. According to court documents, law enforcement officers found growing plants, processed marijuana, an AK-47 style assault rifle with a loaded high-capacity magazine, and a 12 gauge pump-action shotgun. The marijuana cultivation caused significant damage to the land and natural resources of the forest. Six large helicopter-net loads of material and debris, including fertilizer, propane tanks, and poisons, were removed from the forest. Reyes was ordered to pay $10,093 to the U.S. Forest Service to compensate it for the cleanup costs.

This case was the product of an investigation by the U.S. Forest Service, the California National Guard, and Fresno County Sheriff’s Office.

In the second case, Antonio Garcia-Villa (Garcia), 46, pleaded guilty today to conspiring to manufacture, distribute and possess with intent to distribute marijuana and possessing firearms in furtherance of a large-scale cultivation operation.

According to court documents, Garcia was paid to tend and water about 8,596 marijuana plants near Little Poso Creek in the Sequoia National Forest. To facilitate the cultivation activities, Garcia possessed a loaded rifle and handgun. The cultivation activities caused extensive damage to the land and natural resources. Native trees and plants were cut down and steep hillsides were terraced to plant the marijuana. Pesticides, including malathion, fertilizer, water lines, trash, clothing and camping equipment were scattered throughout the site. Garcia has agreed to reimburse the U.S. Forest Service for the cleanup costs.

Garcia is scheduled for sentencing on January 19, 2016, before Senior U.S. District Judge Anthony W. Ishii. Garcia faces a maximum statutory penalty of 20 years in prison and a $1 million fine for the drug conspiracy and a mandatory minimum consecutive term of five years in prison for the firearm charge. The actual sentence 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. Garcia also faces deportation to Mexico upon completion of any prison term imposed.

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

SACRAMENTO, Calif. — Arturo Alcazar-Tapia, 22, of Eureka, was sentenced today to seven years and three months in prison and ordered to pay $17,000 in restitution for conspiring to manufacture and possess with intent to distribute marijuana and for depredation of public lands and resources, United States Attorney Benjamin B. Wagner announced.

According to court documents, Arturo Alcazar-Tapia and his brother, Isidro Alcazar‑Tapia, 26, of Eureka, conspired to grow more than 20,000 marijuana plants at two sites in the Shasta-Trinity National Forest in Trinity County. The marijuana was packaged for distribution at a house in Eureka. On August 4, 2014, law enforcement executed a search warrant at the defendants’ home in Eureka and found 33 pounds of processed marijuana divided into one-pound packages and more than $6,000 in cash. At a cultivation site at Big French Creek, agents located and destroyed approximately 7,980 marijuana plants and arrested co‑defendant Ricky Martin Huerta, 21, of Eureka. At a site at Hobo Gulch Road, agents located and destroyed approximately 13,642 marijuana plants. The marijuana cultivation caused significant damage to the land and natural resources of the forest that provides habitat for several threatened and endangered animal species.

At the Big French Creek site, agents observed hundreds of holes dug in the dirt containing soluble fertilizer, bags of trash, empty fertilizer bags, propane tanks, and water lines diverting water from a stream into the marijuana garden. Analysts estimate that cleaning the Big French Creek site will cost the U.S. Forest Service more than $4,000. Agents observed similar destruction at the Hobo Gulch Road site. Analysts estimate that cleaning the Hobo Gulch Road site will cost the U.S. Forest Service approximately $13,000.

All three defendants pleaded guilty in January 2015. On June 16, 2015, Judge Garland E. Burrell Jr. sentenced Ricky Martin Huerta to two years and eight months in prison, and on August 7, 2015, Judge Burrell sentenced Isidro Alcazar-Tapia to 87 months in prison and ordered restitution of $17,000. A fourth defendant, Victor Manuel Alvarez‑Contreras is currently a fugitive.

This case was the product of an investigation by the U.S. Forest Service, the Humboldt County Drug Task Force, the North State Marijuana Team, and the Trinity County Sheriff’s Office. Assistant United States Attorney Christiaan Highsmith prosecuted the case.

SACRAMENTO, Calif. —Neil A. Van Dyck, 64, of Roseville, pleaded guilty today to health care fraud, United States Attorney Benjamin B. Wagner announced.

According to court documents, Van Dyck was a California-licensed podiatrist who operated a podiatry practice in Roseville called Placer Podiatry. Van Dyck offered “spa”-like treatments and performed routine foot care at his practice. Between 2009 and 2014, however, Van Dyck submitted over $2.8 million in fraudulent claims for reimbursement to Medicare, Medi-Cal, Tricare and private insurers. He falsely claimed that he performed more expensive procedures than he actually performed, or that the routine foot care that was provided was justified because of illness or symptoms that were not present. Often times the treatments were performed by unlicensed staff sometimes when Van Dyck was not present at his practice. Additionally, Van Dyck altered a single-use skincare patch by cutting it into pieces and billed Medicare for multiple applications. In response to a request for documents from an investigator for Medicare, Van Dyck altered patients’ medical records to justify his fraudulent bills. Medicare, Medi-Cal, Tricare, and the private insurers paid Van Dyck over $1 million for his fraudulent claims.

“Providers overbilling and charging for phantom treatments are picking the pockets of taxpayers and assaulting government health program integrity,” said Gerald T. Roy, Special Agent in Charge, Office of Inspector General for the U.S. Department of Health and Human Services. “Working in close coordination with our law enforcement partners we will tirelessly investigate and bring these criminals to justice.”

“Dr. Van Dyck engaged in health care fraud schemes designed to financially benefit himself without regard for the impact his actions had on his patients,” said Supervisory Special Agent David Hanzal of the FBI’s Sacramento field office. “He fraudulently billed health insurance programs and compromised the integrity of Medicare billing and medical history records of patients, potentially impacting the affected patients’ future medical benefits. The FBI, in coordination with our law enforcement partners, continues to investigate providers who prey on unsuspecting patients and defraud public and private health insurance programs.”

This case is the product of an investigation by the Office of Inspector General for the U.S. Department of Health and Human Services and the Federal Bureau of Investigation. Assistant United States Attorney Todd A. Pickles is prosecuting the case.

Van Dyck is scheduled to be sentenced by Judge Garland E. Burrell Jr. on January 15, 2016. Van Dyck faces a maximum statutory penalty of 10 years in prison and a fine of $250,000 or twice the loss or gain. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

FRESNO, Calif. — Christopher James Harp, 58, was arraigned today in Fresno after a federal grand jury returned an indictment on Thursday, charging him with depredation of public lands, United States Attorney Benjamin B. Wagner announced. Harp entered a plea of not guilty at today’s arraignment.

According to court documents, on September 6, 2015, an archaeologist with the United States Forest Service reported graffiti of numerous boulders at a location known as Rabbit Island, a large rock outcropping in the Sequoia National Forest in Kern County that was once the site of a large Tubatulabal Indian village. Agents found black asphalt sealer sprayed on rocks over about 100 yards, including damage to a prehistoric petroglyph of a bighorn sheep on the face of a large boulder.

This case is the product of an investigation by the United States Forest Service. Assistant United States Attorney Michael S. Frye is prosecuting the case.

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

FRESNO, Calif. — After a three–day trial, a federal jury found Shannon Lester Sorrells, 37, of Dinuba, guilty Thursday of five counts of bank fraud, one count of possession of stolen mail, and one count of aggravated identity theft, United States Attorney Benjamin B. Wagner announced. The trial was held before United States District Judge Lawrence J. O'Neill.

According to court documents, Sorrells was indicted in July 2014 and charged with theft of mail from neighborhood delivery collection boxes. He was released on his own recognizance and a trial date was set for August 4, 2015. While awaiting trial, Sorrells committed new offenses and was arrested for violating the conditions of his release. A grand jury brought a superseding indictment charging him with bank fraud, possession of stolen mail, and aggravated ID theft, all committed while Sorrells was on pretrial release.

According to evidence presented at trial, Sorrells passed numerous altered and forged checks at federally insured banking institutions in the Central Valley. In some cases, he presented altered checks using his own identity. In other cases, he used the identity of others. In February 2015, while Sorrells was on pretrial release, agents conducted a search warrant at his residence and recovered stolen mail, counterfeit checks and account information on an account he had opened using the identity of a victim.

San Francisco Division Inspector in Charge Rafael Nuñez of the U.S. Postal Inspection Service stated, “Protecting the U.S. Mail from theft and criminal misuse is a critical component of our agency's mission. We are proud to work closely with the U.S. Attorney’s Office and our law enforcement partners to fully investigate and prosecute anyone who dares to steal the mail.”

This case is the product of an investigation by the United States Postal Inspection Service, the Visalia Police Department and the Tulare County Sheriff’s Office. Assistant United States Attorneys Megan A.S. Richards and Jeffrey A. Spivak are prosecuting the case.

Sorrells is scheduled to be sentenced by Judge O'Neill on January 11, 2016. Sorrells faces a maximum statutory penalty of 40 years in prison and a $1 million 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. — Today, United States District Judge John A. Mendez sentenced Peter Kuzmenko, 37, of West Sacramento, to 19 years in prison; Aaron New, 41, of Sacramento, to 11 years and three months in prison; Nadia Kuzmenko, 36, formerly of Loomis, to eight years in prison; and Edward Shevtsov, 51, of North Highlands, to eight years in prison for their involvement in a mortgage fraud scheme that cost financial institutions approximately $16 million, United States Attorney Benjamin B. Wagner announced.

On February 13, 2015, after a 21-day trial, a federal jury found the four defendants guilty of multiple counts of mail and wire fraud associated with their involvement in 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.

According to the evidence presented at trial, from late 2006 through 2007, the defendants engaged in a mortgage fraud scheme involving more than 35 properties in the Sacramento area. The defendants were responsible for securing more than $26 million in residential mortgage loans on over 35 homes purchased through straw buyers. Records introduced at trial showed each of the defendants personally received hundreds of thousands or millions of dollars.

Judge Mendez, in sentencing the defendants, said in this case there was “overwhelming evidence of the defendants’ guilt” and that this was a “significant fraud.”

Nadia Kuzmenko was a licensed real estate sales person who created fraudulent loan applications on behalf of the straw buyers. The loan applications contained materially false information as to the straw buyers’ income, employment, assets, and intent to occupy the residences. The loan paperwork also hid from lenders millions of dollars in payments that went to the defendants. With respect to the witness tampering count, the evidence showed that after she learned the FBI was investigating her, Nadia Kuzmenko told various witnesses to lie to the FBI and blame a dead woman for the fraud.

Aaron New was a licensed real estate broker who submitted the fraudulent loan applications to lending institutions and convinced home sellers to sign off on fraudulent invoices to divert money out of escrow and to the defendants. New also served as a straw buyer himself.

Peter Kuzmenko and Edward Shevtsov recruited straw buyers and helped create fraudulent loan paperwork. They also controlled shell accounts in which millions of dollars were diverted out of escrow based on fraudulent invoices and false representations made to lenders. Peter Kuzmenko was also a straw buyer himself. Peter Kuzmenko is currently in custody and Edward Shevtsov was remanded into custody upon sentencing.

“These defendants were important players in a network of fraudsters responsible for millions of dollars in losses associated with dozens of inflated property sales using multiple straw buyers,” said U.S. Attorney Benjamin B. Wagner. “The sentences demonstrate that mortgage fraudsters will not escape accountability for their crime by blaming others. Our enforcement efforts in this area are far from done.”

“Today’s sentencing serves as a warning for would-be fraudsters and represents years of dedicated, collaborative investigation,” said Supervisory Special Agent Dan Bryant of the FBI’s Sacramento field office. “The FBI is committed to work with its partners to ensure thorough, comprehensive investigations of such large, complex financial fraud schemes, especially when such crimes victimize a community and damage the regional economy.”

“Mortgage fraud is an incredibly destructive crime that leaves many victims in its wake,” said Thomas McMahon, Acting Special Agent in Charge, IRS-Criminal Investigation. “The impact on homeowners and communities is devastating. While nothing can reverse the damage caused by these defendants, it highlights the ongoing commitment of IRS-CI to hold accountable those involved in these types of crimes.”

 The case is 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 and Michael D. Anderson and Special Assistant U.S. Attorney David J. Ward are prosecuting the case.

Co-defendants Vera Kuzmenko and Rachel Siders will be tried on November 2, 2015. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.

Three other mortgage fraud defendants have been sentenced this week. On Monday, Bakersfield residents Lucia Yolanda Chavez, 37, was sentenced to four years in prison, and Joseph Chavez, 41, was sentenced to three years in prison for conspiracy to commit bank fraud, mail fraud, and wire fraud and were ordered to pay $1.8 million and $1.44 million in restitution respectively. Today in Sacramento, Hubert Rotteveel, 52, of Dixon, was sentenced to three years and four months in prison for mail fraud.

SACRAMENTO, Calif. — Hubert Rotteveel, 52, of Dixon, was sentenced today by Senior United States District William B. Shubb to three years and four months in prison for one count of mail fraud, United States Attorney Benjamin B. Wagner announced.

In September 2014, Rotteveel was found guilty by a federal jury of one count of mail fraud relating to 13 properties in Dixon. According to evidence produced at trial, Rotteveel acted as a real estate salesperson for the 13 properties, with over $7 million in loans authorized for just two buyers in seven months. He inflated the values of the properties and worked with loan officers to provide false information to lenders about the income and liabilities of the buyers to induce the lenders to fund loans for the properties. Rotteveel surreptitiously made the down payments on the homes, instead of the buyers, and got that money (and usually more) back from the lenders at closing. For most of the transactions, when the sales closed, the escrow officer distributed funds to a bank account in the name of Windmill Properties, a company owned by Rotteveel, without disclosing these payments to the lenders. All 13 properties were used as rentals, with Rotteveel collecting the rents through Windmill Properties. He netted over $300,000 through the sales in just seven months, and the lenders lost more than $3 million when all 13 properties underwent foreclosure.

U.S. Attorney Wagner stated: “Hubert Rotteveel used his knowledge of the real estate market in Dixon to defraud lenders of over $7 million, resulting in losses of over $3 million after each of the homes went into default and a foreclosure sale was held. Today’s sentence is one step in the continuing effort to hold real estate professionals responsible for their role in the mortgage meltdown.”

“This prosecution should serve as a warning to those who abuse their position of trust,” said Thomas McMahon, Acting Special Agent in Charge, IRS-Criminal Investigation. “Mr. Rotteveel manipulated the MLS listings for properties, failed to disclose his true role in the transactions and made numerous misrepresentations to lenders.  Although this sentence cannot reverse the damage caused by Mr. Rotteveel, it highlights the ongoing commitment of IRS-CI to hold accountable those involved in these types of crimes.”

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 Jean M. Hobler and Justin L. Lee prosecuted the case.

SACRAMENTO, Calif. —Keith Joseph Banning, 59, of Magalia, was sentenced today to 15 years in prison for receiving and distributing child pornography, United States Attorney Benjamin B. Wagner announced.

According to court documents, an undercover investigation revealed that in June through August of 2012, an Internet user at Banning’s home address was using a peer-to-peer file-sharing network to share pictures and videos depicting the sexual exploitation of children, including a number of videos involving children under the age of 10. A search warrant executed at Banning’s home revealed that his computers contained hundreds of videos depicting the sexual abuse of children, and that at various times many of those videos were made available to others over the Internet through a file-sharing network. Banning was caught in another state living under a false name, and had rebuilt his collection of child pornography while living on the run.

This case was the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI). Assistant United States Attorney Matthew G. Morris 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.

SACRAMENTO, Calif. — On Saturday, October 17, the United States Attorney’s Office, in partnership with the California Office of Emergency Services, held a Community Resilience Exercise (CREX) at the central library at California State University, Fresno. The day-long event, involving about 50 participants, brought together representatives of law enforcement and other government agencies with representatives of Muslim communities in the Fresno and Madera areas.

Law enforcement participants included the U.S. Attorney, Fresno Office Chief Mark E. Cullers, Assistant Director David Fukutomi of CalOES, Fresno Sheriff Margaret Mims, Fresno Police Chief Jerry Dyer, Fresno State Police Chief David Huerta, and others including school resource officers, FBI agents, and mental health professionals from the Fresno County Department of Behavioral Health. Muslim community representatives included religious leaders from several congregations such as Masjid Fresno, Masjid Madera, Badr Islamic Center, Masjid Al-Aqabah, and Islamic Cultural Center of Fresno; business, academic and civil leaders; representatives of the Muslim Society of Central California; and students.

ISIS and other violent extremist organizations are adept at using modern communication channels to recruit and radicalize young people. The CREX is a scenario‑based exercise, facilitated by professionals from the National Counterterrorism Center, designed to strengthen relationships between Muslim communities and government and to help both community leaders and local law enforcement focus on local resources and strategies to protect young people and their communities from these groups.

“We in law enforcement must work hand-in-hand with people of all faiths in order to effectively protect children and our communities. No one is more concerned about these issues than people in the communities that are targeted for recruitment by extremists,” said U.S. Attorney Wagner. “Our exercise this weekend is just one example of how various Muslim communities throughout our district are committed to helping address this problem. I am honored to work with them in carrying out this very important work.”

Cal OES Assistant Director David Fukutomi stated: “The Governor’s Office of Emergency Services (Cal OES) is proud to be a co-sponsor of this important effort. We appreciate the participation of the local community leaders as we seek to build lasting relationships that will have lasting benefit to our families and communities.”

Over 250 U.S. citizens or residents have traveled or attempted to travel to Syria and Iraq since early 2014 to join militant groups, mostly ISIS. Many of them are minors, including young girls. Approximately 28 have been arrested by federal authorities while attempting to travel overseas to join extremist groups.

FRESNO, Calif. — Today, United States District Judge Lawrence J. O'Neill sentenced three defendants in two cases for trafficking methamphetamine, United States Attorney Benjamin B. Wagner announced.

In the first case, Jose Mojarro Cruz, aka Shyboy, 28, of Bakersfield was sentenced to 15 years and nine months in prison for conspiring to distribute and possess with intent to distribute methamphetamine and heroin. He pleaded guilty on April 21, 2015. Co-defendant Arnoldo Delgado Garcia (Delgado), aka Fabricio Rene Delgado-Perea, 35, a Mexican national, was sentenced to 11 years and four months in prison. On May 11, 2015, he pleaded guilty to conspiring to distribute and possess with intent to distribute methamphetamine and heroin.

According to court documents, from May 2013 through January 2014, the defendants regularly distributed methamphetamine and heroin to various drug dealers and users in Kern County. The defendants admitted to distributing between 15 and 45 kilograms of methamphetamine and over 1,000 grams of heroin. Co-defendant Erik Gesus Rivera, 28, of Bakersfield, pleaded guilty to possession with intent to distribute methamphetamine, and on September 21, 2015, was sentenced to two years in prison.

This case was the product of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the Drug Enforcement Administration, Kern County Sheriff’s Office, and the Southern Tri-County High Intensity Drug Trafficking Area Task Force. Assistant United States Attorney Brian K. Delaney prosecuted the case.

In the second case, Judge O’Neill sentenced Juan Lascano Jr., 32, of Bakersfield, to 10 years in prison. On July 27, 2015, Lascano pleaded guilty to distribution of methamphetamine.

According to court documents, Lascano and his co-defendants conspired to distribute pound-quantities of methamphetamine in the Bakersfield area. On September 21, 2015, co-defendant Guillermo Magallanes, 36, of Bakersfield, pleaded guilty to conspiracy to distribute methamphetamine, and co-defendant Pasqual Gonzales Magallanes, 44, of Bakersfield, pleaded guilty to distribution of methamphetamine.

Sentencing for the two co-defendants is scheduled for December 14, 2015. Guillermo Magallanes faces a maximum statutory penalty of life in prison and a $5 million fine, and Pasqual Gonzales Magallanes faces a maximum statutory penalty of 40 years in prison and a $2 million 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.

In addition to the criminal charges, the United States is seeking the forfeiture of $31, 242, a 2014 Lexus IS250 F Sport, and a 2012 Acura TL sedan as proceeds of the illegal drug trafficking activity.

This case is the product of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation by the Drug Enforcement Administration, the Federal Bureau of Investigation, the Kern County Sheriff’s Office, and the Bakersfield Police Department. Assistant United States Attorney Brian K. Delaney is prosecuting the case.

FRESNO, Calif. — Ezequiel Armas-Ortiz (Armas), 49, of Michoacán, Mexico, pleaded guilty today to conspiracy and to manufacturing and possessing with intent to distribute marijuana in connection with a large-scale cultivation operation in the Brush Creek drainage in the Sequoia National Forest in Tulare County, United States Attorney Benjamin B. Wagner announced.

According to court documents, Armas and two other men charged with him were responsible for watering 2,719 marijuana plants at the grow site. The marijuana cultivation activities caused extensive damage to the land and natural resources. Trees and plants, newly generated following the 2002 McNally Fire, were cut down to make room for the marijuana. Water was diverted from a nearby stream that supports trout. Armas also agreed to make restitution to the U.S. Forest Service for the damage caused by his wrongful conduct.

Armas is scheduled for sentencing on January 19, 2016. He faces a maximum statutory penalty of 20 years in prison and a $1 million fine. The actual sentence 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. Armas is also subject to deportation to Mexico after serving any term of imprisonment imposed.

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

FRESNO, Calif. — United States District Court Judge Lawrence J. O’Neill sentenced Tryvell Powell, 34, of Fresno, today to 10 years and 10 months in prison for sex trafficking of a minor, United States Attorney Benjamin B. Wagner announced.

According to court documents, Powell communicated with a 16-year-old girl on Facebook and persuaded her to leave Modesto where she was living and travel to Fresno. She then engaged in sex acts with strangers at Powell’s request for his monetary benefit. A relative of the girl reported seeing pictures of the teen in an online advertisement for prostitution. Fresno detectives used the advertisements to contact the girl and arrested Powell.

This case was the product of an investigation by the Federal Bureau of Investigation and the Fresno Police Department. Assistant United States Attorney Michael Frye prosecuted the case.

This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about Internet safety education.

FRESNO, Calif. — Two Bakersfield residents were sentenced Tuesday by Senior United States District Judge Anthony W. Ishii in connection with a mortgage fraud scheme in Bakersfield, United States Attorney Benjamin B. Wagner announced.

Lucia Yolanda Chavez, 37, was sentenced to four years in prison for conspiracy to commit bank fraud, mail fraud, and wire fraud, and was ordered to pay $1.8 million in restitution. Joseph Chavez, 41, was sentenced to three years in prison for conspiracy to commit bank fraud, mail fraud, and wire fraud, and was ordered to pay $1.44 million in restitution. Lucia Chavez was also ordered to forfeit her interest in approximately $110,000 seized from a bank account, and to pay a personal forfeiture money judgment of $1.6 million. Joseph Chavez was ordered to pay a personal forfeiture money judgment of $3 million.

According to court documents, from 2007 to 2010, the Chavez defendants conspired with other co-defendants to use straw buyers to purchase residential properties in Bakersfield developed by Pershing Partners LLC (Pershing Partners), owned by Lucia Chavez, and by Jara Brothers Investments (JBI), owned by co-defendants Eliseo Jara and Sergio Jara. The conspirators paid straw buyers to purchase the properties from Pershing Partners and JBI, and funded the purchases using loans they obtained for the straw buyers from lenders based on false and fraudulent loan applications. The conspirators used Paragon Home Mortgage to obtain and process loans in furtherance of the conspiracy. Lucia Chavez had also been employed at Paragon Home Mortgage since approximately August 2006, and acquired ownership of Paragon Home Mortgage from co-defendants Eliseo Jara Jr. and Sergio Jara in 2007. Joseph Chavez was employed as a loan officer and office manager at Paragon Home Mortgage from approximately June 2006 to October 2007. Joseph Chavez and Lucia Chavez pleaded guilty on April 10, 2015.

The loan applications in the names of straw buyers frequently contained false statements concerning the straw buyers’ employment status, income, assets, intent to occupy the properties as their personal residences, and source of down payments for the purchase of the properties. The conspirators concealed from the lenders that the property developers funded certain of the straw buyers’ down payments. The conspirators also submitted false supporting documentation to lenders such as false and altered bank account statements purporting to show that straw buyers had high bank account balances, false verifications of the straw buyers’ bank account funds, false verifications of rent purporting to be from straw buyers’ landlords, false pay stubs, and false verifications of employment.

This case is the product of an investigation by the Internal Revenue Service - Criminal Investigation and the Federal Bureau of Investigation. Assistant U.S. Attorneys Kirk E. Sherriff and Henry Z. Carbajal III prosecuted the case.

On October 13, 2015, co-defendants Eliseo Jara and Sergio Jara were each sentenced to six and a half years in prison, and co-defendant Melissa Jara was sentenced to five years on supervised release. Co-defendant Antonio Perez-Marcial was sentenced on May 12, 2014, to three years and 10 months in prison, and co-defendant Arlene Jeanette Mojardin was sentenced on May 18, 2015, to two and a half years in prison, for their roles in the conspiracy. Co-defendant Candace Gonzales previously pleaded guilty to conspiracy to commit bank fraud, mail fraud, and wire fraud, and her sentencing hearing is currently set for October 26, 2015. Co-defendant Ricardo Salinas previously pleaded guilty to bank fraud, and his sentencing is also currently set for October 26, 2015.

FRESNO, Calif. — A seven-count indictment has been unsealed, following the arrests of Haitham Eid Habash, aka Eddie Habash, 52, of Hawthorne; Zaid Elodat, 28, of Gardena; and Bakersfield residents Ramsey Jeries Farraj, 48, and Majed Bashir Akroush, aka Mike Akroush, 48, charging them with conspiring to manufacture, distribute, and possess with intent to distribute AB-Chminaca, AB-Pinaca, and XLR11, smokeable synthetic drugs that are Schedule I controlled substances, United States Attorney Benjamin B. Wagner announced.

Farraj is also charged with four separate counts of distributing the drugs. Akroush is charged with two counts of distributing AB-Chminaca, and Farraj and Elodat are charged with possessing AB-Chminaca and AB-Pinaca with intent to distribute. In addition, Farraj and Akroush are charged with conspiring to structure more than $3 million in proceeds derived from their Internet-based drug distribution businesses. The indictment also seeks to forfeit property and bank accounts owned by Habash, Akroush, and Farraj and the domain names of their drug distribution businesses, Blue Whale Store and World of Incense.

“Synthetic drugs are a serious public health threat and are endangering young people across the country,” said U.S. Attorney Wagner. “The chemicals in these drugs, usually manufactured in unsupervised factories in China, are not tested or approved for human consumption, and have led to psychotic episodes, seizures and deaths, even in small quantities. Stores should not sell them, and young people should not play Russian roulette by consuming them.”

DEA Acting Special Agent in Charge Bruce C. Balzano stated, “Synthetic drugs are dangerous, deadly poisons often marketed to attract teen and young adult use. These drugs are manufactured without quality controls and have unpredictable effects that can lead to grave consequences for the unsuspecting user. These arrests have dismantled a criminal network responsible for the manufacture and distribution of some very toxic drugs.”

The charges are part of a nationwide synthetic drug takedown in connection with Project Synergy Phase III that targeted the synthetic designer drug industry, including wholesalers, money launderers and other criminal facilitators. In connection with this case, federal law enforcement officers arrested the four defendants and executed 12 search warrants in Bakersfield and the Los Angeles area. Over 1,000 pounds of synthetic drugs, nearly a half a million dollars in cash and four firearms were seized.

The Drug Enforcement Administration (DEA), Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI), Customs and Border Protection (CBP), along with other federal, state, and local law enforcement concluded a 15-month, nationwide drug interdiction effort that resulted in 151 arrests in 16 states. In addition to curbing the flow of synthetic drugs into the country, Project Synergy III continues to reveal the flow of millions of dollars in U.S. synthetic drug proceeds to countries of concern in the Middle East.

In May 2013, DEA placed XLR11 in Schedule I after the Centers for Disease Control and Prevention found that acute kidney injury is associated with its ingestion. AB-Pinaca and AB-Chminaca were placed into Schedule I at the beginning of this year based on a finding that these drugs pose an imminent hazard to the public.

This case is the product of an investigation by the U.S. Drug Enforcement Administration, the Internal Revenue Service-Criminal Investigation, and the California Highway Patrol, with assistance from the Federal Bureau of Investigation, the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); the U.S. Postal Inspection Service, the California Department of Motor Vehicles, the Kern County Probation, the Kern County Sheriff’s Office, the Bakersfield Police Department, and the Los Angeles County Sheriff’s Office. Assistant United States Attorneys Karen A. Escobar, Grant B. Rabenn, and Jeffrey A. Spivak are prosecuting the case.

This case was part of an Organized Crime Drug Enforcement Task Force (OCDETF). The OCDETF program was established in 1982 to conduct comprehensive, multi-level attacks on major drug trafficking and money laundering organizations. The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking and money laundering organizations and those primarily responsible for the nation’s drug supply.

If convicted of the drug charges, the defendants face a maximum statutory penalty of 20 years in prison and a $1 million fine. The structuring conspiracy carries a maximum statutory penalty of five 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.

Habash is in custody, Farraj was released on bond. A detention hearing has been ordered for Elodat and Akroush. The next court date for all defendants is January 11, 2016, before U.S. Magistrate Judge Barbara A. McAuliffe in Fresno.

FRESNO, Calif. — A federal grand jury returned a 13-count indictment today against 14 individuals, charging them with conspiring to distribute methamphetamine, cocaine, and heroin, United States Attorney Benjamin B. Wagner announced.

Charged in the indictment are Olegario Trujillo, 29, of Fresno; Arnold Martinez Valencia, 39, of Woodlake; Edgar Valencia-Farias, of Tulare; Caesar Alejandro Gomez, 33, of Fresno; Gladys Ramos, 30, of Woodlake; Carlos Tafoya-Ramos, 22, of Woodlake; Marcos Diaz, 23, of Madera; Ramiro Salas Munoz, 37, of Lindsay; Arthur Allen Walker, 32, of Poplar; Francisca Torres-Guisar, 51, of Visalia; Pedro Delgado-Montenegro, 36, of Porterville; Jose Roberto Arreola-Serrato, 31, of Tulare; Gary Passmore, 65, of Washington state, and Jorge Martinez Jr., 23, of Tulare.

According to court documents, Olegario Trujillo was the leader of a large-scale drug trafficking organization, responsible for distributing methamphetamine, cocaine, and heroin in California and Washington. Pedro Delgado-Montenegro and Jose Arreola-Serrato supplied him with methamphetamine. Trujillo directed several of the other charged individuals to deliver drugs and instructed them as to the disposition of drug proceeds. Arnoldo Martinez Valencia worked with Trujillo, managing the drug distribution to Shelton, Washington. As the result of investigation, law enforcement seized a large amount of controlled substances, including 14 kilograms of methamphetamine, two kilograms of cocaine, and one kilogram of heroin.

This case was the product of a Central Valley High Intensity Drug Trafficking Area (HIDTA) investigation conducted by the Central Valley Marijuana Investigation Team (CVMIT). CVMIT is comprised of the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), California Department of Justice-Bureau of Investigation, California Fish and Wildlife, Tulare County Sheriff's Office, Kings County Sheriff's Office, and Fresno County Sheriff's Office. Assistant United States Attorney Kathleen Servatius is prosecuting the case.

If convicted, Trujillo faces a maximum statutory penalty of life in prison and a $10 million fine. The remaining defendants face a maximum statutory penalty of 20 years in prison and a $1 million 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. — A federal grand jury returned a 70-count indictment today against eight men, charging them with various firearms offenses involving manufacturing and dealing firearms without a license, United States Attorney Benjamin B. Wagner and ATF Special Agent in Charge Jill A. Snyder announced.

• Joseph Latu, 29, of Elk Grove, is charged with conspiracy to deal firearms without a license, dealing firearms without a license, conspiracy to manufacture and deal firearms without a license, possession of an unregistered short-barreled rifle, possession of an unregistered silencer, possession of an unserialized firearm.
• Algernon Tamasoa, 27, of Sacramento, is charged with conspiracy to deal firearms without a license, dealing firearms without a license, possession of an unserialized firearm, and distribution of MDMA.
• John Ortiz, 43, of Vallejo, and Keith White, 40, of Vallejo, are charged with conspiracy to deal firearms without a license, dealing firearms without a license, and possession of an unserialized firearm.
• Charles Tucker, 29, of Stockton, and Ionel Pascan, 28, of Riverbank, are charged with dealing firearms without a license, conspiracy to manufacture and deal firearms without a license, possession of an unregistered short-barreled rifle, possession of an unregistered silencer, and possession of an unserialized firearm.
• Daniel Bennett, 39, of Stockton, and David Bennett, 27, of Stockton, are charged with conspiracy to manufacture and deal firearms without a license.

According to court documents, between February 6 and September 28, 2015, on 24 occasions, the defendants, either individually or together, met with an undercover ATF agent and sold him a variety of firearms, including rifles, AR-15 type rifles, AR-15 type short-barreled rifles, revolvers, pistols, and silencers. In all, the sales involved 67 firearms and 38 silencers. Additionally, 71 firearms and 62 silencers were recovered during the arrest of certain defendants and ensuing execution of search warrants. In total, 238 firearms and silencers were recovered. Many of the firearms did not have a serial number or other identification markings and were manufactured from unfinished lower receivers, commonly known as “80 percent” lower receivers or “ghost guns.” None of the silencers had a serial number or other identification marking, as is required for firearms under the law. Further, many of the firearms were short-barreled rifles, which must be registered on the National Firearms Registration and Record. None of the short-barreled rifles sold to the undercover agent were registered to any of the defendants.

According to court documents, the firearms sold to the undercover agent were supplied by Latu, Tamasoa, White, Ortiz, Tucker, Pascan, Daniel Bennett, and David Bennett. Many of those firearms were manufactured from firearm parts by Tucker, Pascan, Daniel Bennett, and David Bennett. At the time he was manufacturing firearms, David Bennett worked as a San Joaquin County Sheriff correctional officer.

“High-capacity assault rifles, with silencers but without serial numbers, are some of the most lethal weapons that criminals can get their hands on,” said U.S. Attorney Wagner. “Manufacturing and selling these weapons for profit, without complying with federal licensing rules, is both a serious crime and a serious threat to public safety.”

“ATF's primary mission is to reduce violent crime and protect the public. With the seizure of 238 firearms and silencers, we have accomplished both,” said Special Agent in Charge Jill A. Snyder. “ATF will continue to pursue the individuals who chose to break the law and unlawfully traffic in firearms.”

Woodland Chief of Police Dan Bellini stated: “It was only through the collaboration of the various law enforcement agencies involved in this investigation that we were successful in bringing these charges.”

West Sacramento Chief of Police Tom McDonald stated: “This was a great example of mutual partnership between local and federal agencies in a coordinated effort to prevent crime and improve safety in our communities. The operation was successful in the interdiction of illegal firearms at their source before these firearms could reach the streets of our communities. Once again, I’d like to thank Woodland Police Chief Bellini and Resident Agent in Charge Graham Barlowe for this outstanding coordinated effort.”

According to complaints filed in the case, on several occasions in August and September, the undercover agent met with Latu, Tucker, and Pascan to discuss a large-scale purchase of AR-15 type rifles and silencers. Latu, Tucker, and Pascan agreed to manufacture 50 short-barreled AR-15 type rifles and 50 silencers, which would be sold to the undercover agent in early October.

On October 6, 2015, the undercover agent met with Latu, Tucker, and Pascan at the Yolo County Airport in Davis. Latu, Tucker, and Pascan brought 50 unmarked, unserialized short-barreled AR-15 type rifles and 50 unmarked, unserialized silencers, which they intended to sell to the undercover agent. After Latu, Tucker, and Pascan showed the undercover agent the firearms and silencers, a team of law enforcement officials arrested the three defendants. At the time of his arrest, Pascan had a handgun concealed in his waistband and a second handgun was under the front passenger seat of the vehicle. Later that day, law enforcement authorities arrested Tamasoa, White, and Ortiz. On October 14, 2015, authorities arrested Daniel Bennett and David Bennett.

In addition to the firearms charges, Tamasoa was also charged with selling MDMA to the undercover agent in a transaction on April 3, 2015. Tamasoa and Ortiz were separately indicted in an unrelated narcotics case on June 18, 2015. Both defendants were released on bond in that case. (Case # 2:15-cr-124 KJM)

This case is the product of an investigation by the U.S. Department of Justice Bureau of Alcohol, Tobacco, Firearms, and Explosives; the West Sacramento Police Department; the Woodland Police Department; with assistance from the Sacramento Police Department; the U.S. Drug Enforcement Administration; Vallejo Police Department; U.S. Customs & Border Protection’s (CBP) Air and Marine Operations (AMO); Yolo County Narcotics Enforcement Team; the Western States Information Network Inc., and the California Highway Patrol. Assistant United States Attorney Christiaan Highsmith is prosecuting the case.

If convicted, the defendants face maximum statutory penalties for the various charges as follows: the penalty for each count of conspiracy and each count of dealing firearms or manufacturing firearms without a license is five years in prison and a $250,000 fine, the penalty for each count of possessing a firearm without a serial number and each count of possessing an unregistered short-barreled rifle or silencer is 10 years in prison and a $10,000 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. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.

SACRAMENTO, Calif. — Federico Sandoval Aguilar, 43, of Biggs, was sentenced today by United States District Judge Kimberly J. Mueller to 17 and half years in prison for conspiring to distribute methamphetamine, United States Attorney Benjamin B. Wagner announced.

According to court documents, Aguilar was the head of a drug trafficking organization that was responsible for distributing pound-quantities of methamphetamine on a weekly basis in Butte County. Over a four-month period in 2013, Aguilar’s organization distributed over 49 pounds of methamphetamine. Aguilar was arrested at his residence in August 2013, where law enforcement officers found 15 cellphones, five guns, and $50,000 in cash concealed within a bathroom air vent.

This case was the product of an investigation by the Drug Enforcement Administration, the Butte Interagency Narcotics Task Force (BINTF), the Butte County Sheriff’s Office, the Butte County Probation Department, the Butte County District Attorney’s Office, the California Highway Patrol, the California Department of Justice Bureau of Gambling Control, the Chico Police Department, and the United States Marshals Service. Assistant United States Attorney Justin Lee prosecuted the case.

This case was part of an Organized Crime Drug Enforcement Task Force (OCDETF). The OCDETF program was established in 1982 to conduct comprehensive, multi-level attacks on major drug trafficking and money laundering organizations. The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking and money laundering organizations and those primarily responsible for the nation’s drug supply.