Northern District of California
Press releases recorded for this federal judicial district.
Justice Department Reaches Agreement with Antioch, California, Police Department Resolving Race Discrimination InvestigationRead the Press Release
The Justice Department announced today an agreement with the Antioch, California, Police Department (APD) and the City of Antioch to resolve an investigation of race discrimination and other discriminatory conduct by APD officers against members of the public in Antioch.
The department launched its investigation after the public disclosure of discriminatory text communications that dozens of APD personnel allegedly exchanged between September 2019 and January 2022. The Justice Department’s Civil Rights Division and the U.S. Attorney’s Office for the Northern District of California jointly investigated APD’s compliance with Title VI of the Civil Rights Act of 1964 (Title VI) and the nondiscrimination provisions of the Omnibus Crime Control and Safe Streets Act (Safe Streets Act). Title VI and the Safe Streets Act collectively prohibit discrimination on the basis of race, color, national origin, sex and religion by recipients of federal financial assistance, such as APD.
“Fair and non-discriminatory policing is fundamental to effective law enforcement, especially for those agencies that receive federal funding,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “In working with the Justice Department to institute policing reform, Antioch Police Department sends a strong message that the discrimination and misconduct that prompted this investigation will not be tolerated. The agreement we have secured will ensure that Antioch’s policing practices are free from discrimination in the road ahead — the community deserves nothing less.”
“Law enforcement is only effective when it inspires public confidence,” said U.S. Attorney Ismail J. Ramsey for the Northern District of California. “A police department that discriminates based on race and other protected classes undermines both public safety and public confidence. Today’s agreement will help ensure that policing in Antioch is done constitutionally and will help restore public trust.”
In response to the investigation, APD, the City of Antioch and the City Manager worked cooperatively with the department to reach a resolution agreement embodying a commitment to nondiscrimination in APD’s policing operations and advancing its ongoing efforts to prevent and address discriminatory law enforcement practices.
Under the agreement, APD will hire an expert law enforcement consultant jointly selected by the parties to review and update APD’s policies, procedures and training on a variety of topics, including non-discriminatory policing, use of force, hiring and promotions, investigations of misconduct, discipline, community policing, language access, and other topics. The agreement contemplates a role for the Antioch Police Oversight Commission and sets forth a framework for data collection and reporting for a five-year period of departmental monitoring, among other provisions.
Nondiscrimination under Title VI and the Safe Streets Act is a top priority of the Civil Rights Division. Additional information about the Civil Rights Division is available at www.justice.gov/crt. Members of the public may report possible civil rights violations at civilrights.justice.gov/report/.
Justice Department Reaches Agreement with Antioch Police Department Resolving Race Discrimination InvestigationRead the Press Release
OAKLAND — The Justice Department announced today an agreement with the Antioch, California, Police Department (APD) and the City of Antioch to resolve an investigation of race discrimination and other discriminatory conduct by APD officers against members of the public in Antioch.
The department launched its investigation after the public disclosure of discriminatory text communications that dozens of APD personnel allegedly exchanged between September 2019 and January 2022. The U.S. Attorney’s Office and the Justice Department’s Civil Rights Division jointly investigated APD’s compliance with Title VI of the Civil Rights Act of 1964 (Title VI) and the nondiscrimination provisions of the Omnibus Crime Control and Safe Streets Act (Safe Streets Act). Title VI and the Safe Streets Act collectively prohibit discrimination on the basis of race, color, national origin, sex, and religion by recipients of federal financial assistance, such as APD.
“Law enforcement is only effective when it inspires public confidence,” said United States Attorney Ismail J. Ramsey. “A police department that discriminates based on race and other protected classes undermines both public safety and public confidence. Today’s agreement will help ensure that policing in Antioch is done constitutionally and will help restore public trust.”
“Fair and non-discriminatory policing is fundamental to effective law enforcement, especially for those agencies that receive federal funding,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “In working with the Justice Department to institute policing reform, Antioch Police Department sends a strong message that the discrimination and misconduct that prompted this investigation will not be tolerated. The agreement we have secured will ensure that Antioch’s policing practices are free from discrimination in the road ahead — the community deserves nothing less.”
In response to the investigation, APD, the City of Antioch and the City Manager worked cooperatively with the department to reach a resolution agreement embodying a commitment to nondiscrimination in APD’s policing operations and advancing its ongoing efforts to prevent and address discriminatory law enforcement practices.
Under the agreement, APD will hire an expert law enforcement consultant jointly selected by the parties to review and update APD’s policies, procedures, and training on a variety of topics, including non-discriminatory policing, use of force, hiring and promotions, investigations of misconduct, discipline, community policing, language access, and other topics.
The agreement contemplates a role for the Antioch Police Oversight Commission and sets forth a framework for data collection and reporting for a five-year period of departmental monitoring, among other provisions.
Assistant United States Attorney Michael Keough, with the assistance of Jonathan Birch, and attorneys from the Federal Coordination and Compliance Section of the Justice Department’s Civil Rights Division are handling this case.
Members of the public may report possible civil rights violations to this office via our website or at civilrights.justice.gov/report/.
Antioch Agreement
El Departamento de Justicia llega a un acuerdo con la Policía de Antioch, California, para resolver la investigación de discriminación por motivos de razaRead the Press Release
El Departamento de Justicia anunció hoy un acuerdo con la Policía de Antioch, California (APD, por sus siglas en inglés) y la Ciudad de Antioch para resolver una investigación de conducta racista y discriminatoria de agentes de la APD contra miembros del público en Antioch.
El Departamento inició su investigación después de la divulgación pública de mensajes de texto discriminatorios que decenas de miembros del personal de la APD supuestamente intercambiaron entre septiembre del 2019 y enero del 2022. La División de Derechos Civiles del Departamento de Justicia y la Fiscalía Federal para el Distrito Norte de California investigaron conjuntamente el cumplimiento de la APD con el Título VI de la ley de Derechos Civiles de 1964 (Título VI) y las disposiciones antidiscriminatorias de la Ley General de Control de Delitos y Calles Seguras (ley de Calles Seguras). El Título VI y la ley de Calles Seguras prohíben, en su conjunto, la discriminación por motivos de raza, color de piel, origen nacional, sexo o religión por parte de entidades que reciben apoyo financiero federal, tal como la APD.
«La vigilancia policial justa y no discriminatoria es fundamental para la aplicación efectiva de la ley, especialmente para aquellas agencias que reciben financiación federal», comentó Kristen Clarke, la Fiscal General Auxiliar de la División de Derechos Civiles del Departamento de Justicia. «Al trabajar con el Departamento de Justicia para instituir una reforma policial, la Policía de Antioch está enviando un mensaje fuerte que la discriminación y la conducta indebida que impulsaron esta investigación no se tolerarán. El acuerdo que hemos conseguido garantizará que las prácticas policiales de Antioch estén libres de discriminación en el camino futuro—la comunidad no merece menos».
«La aplicación de la ley sólo es eficaz cuando inspira la confianza pública», afirmó Ismail Ramsey, el Fiscal Federal para el Distrito Norte de California. «Una fuerza policial que discrimina por motivos de raza y otras clases protegidas socava tanto la seguridad pública como la confianza pública. El acuerdo de hoy ayudará a garantizar que la vigilancia policial en Antioch se realice de manera constitucional y ayudará a restablecer la confianza pública».
En respuesta a la investigación, la APD, la Ciudad de Antioch, y la Administradora de la Ciudad trabajaron en cooperación con el Departamento para alcanzar un acuerdo de resolución que encarnase un compromiso con la ausencia de discriminación en las operaciones de vigilancia policial de la APD y el avance de sus esfuerzos continuos por prevenir y abordar las prácticas discriminatorias de aplicación de la ley.
En virtud del acuerdo, la APD contratará a un consultor experto en aplicación de la ley seleccionado conjuntamente por las partes para revisar y actualizar los procedimientos, políticas y capacitación de la APD sobre una variedad de temas, lo que incluye la vigilancia policial no discriminatoria, el uso de la fuerza, la contratación y ascensos, investigaciones de conducta indebida, la disciplina, la vigilancia comunitaria y el acceso lingüístico, entre otros temas. El acuerdo contempla una función para la Comisión de Supervisión de la Policía de Antioch y establece un marco para la recopilación de datos y la presentación de informes durante un período de cinco años de supervisión departamental, entre otras disposiciones.
La no discriminación en virtud del Título VI y la ley de Calles Seguras es una de las principales prioridades de la División de Derechos Civiles. Hay más información sobre la División de Derechos Civiles a www.justice.gov/crt. Los miembros del público pueden denunciar posibles infracciones de los derechos civiles en civilrights.justice.gov/report/.
Sacramento Man Pleads Guilty to Sexual Assault of Fellow Passenger Aboard International Flight to San FranciscoRead the Press Release
SAN FRANCISCO – Rajesh Kumar Kapoor, 57, of Sacramento, pleaded guilty on Dec. 19, 2024, to sexual assault of another passenger aboard an aircraft bound for San Francisco.
Defendant was indicted on Mar. 13, 2024. The indictment alleged that, while on a flight from the Republic of Korea to San Francisco on Jan. 16, 2024, Kapoor touched the victim’s breasts and inner thigh without permission.
In connection with pleading guilty, Kapoor admitted that he intentionally touched the victim’s inner thigh without the victim’s permission and with the intent to harass her. Kapoor pleaded guilty, with no plea agreement from the government, to abusive sexual contact in violation of 18 U.S.C. § 2244(b).
“Sexual assault has no place in our society, not on the ground and not in the skies. Airline passengers should not have to fear sexual assault while traveling. These assaults are federal crimes, and I urge the public to report them to law enforcement so they can be investigated and prosecuted,” said United States Attorney Ismail J. Ramsey.
"Sexual misconduct on an aircraft is a serious violation of federal law and public trust,” said Federal Bureau of Investigation (FBI) Special Agent in Charge Robert K. Tripp. “Everyone has the right to feel safe while traveling. The FBI will continue working with our partners to ensure justice for victims of such outrageous criminal behavior.”
Kapoor’s sentencing is scheduled for Mar. 27, 2025, before the Honorable Edward M. Chen, Senior U.S. District Judge. He faces a statutory maximum of two years in prison and a $250,000 fine. Any sentence will be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Special Assistant United States Attorney Matthew Chou and Assistant United States Attorney Nicholas M. Parker are prosecuting this case with the assistance of Claudia Hyslop, Marina Ponomarchuk, Andy Ding, and Tina Rosenbaum. The prosecution is the result of an investigation by the FBI, with assistance from U.S. Customs and Border Protection and the San Francisco Police Department Airport Bureau.
Four Indicted for Operating Unlicensed Money Transmitting Business, Conspiracy to Make False Statements to A BankRead the Press Release
SAN FRANCISCO - A federal grand jury in Oakland indicted four individuals on charges of operating an unlicensed money transmitting business, conspiracy to operate an unlicensed money transmitting business, and conspiracy to make false statements to a bank.
According to the indictment filed Nov. 7, 2024, and unsealed Dec. 16, 2024, Gaston Kolker, 49, of Connecticut, Michael Goldfine, 66, of New York, Astrid Jasnis, 52, of Argentina, and Joanna O’Donnell, 56, of Sherman Oaks, California, allegedly made false statements to FDIC-insured banks in order to initiate and maintain a business transmitting money on behalf of others, many of whom were foreign nationals in Argentina. The defendants allegedly opened and maintained numerous accounts under false pretenses, claiming the accounts were held in the names of companies engaged in the importing and exporting of goods, when the defendants were operating the accounts for an unlicensed money transmitting business that transferred funds on behalf of others. The defendants are also charged with operating, and conspiring to operate, a money transmitting business without a license.
Kolker was arrested in Connecticut on Dec. 13, 2024, made his initial appearance in Hartford that day, and was released on $250,000 bond. Goldfine self-surrendered on Dec. 13, 2024, made his initial appearance in New York City that day, and was released on $100,000 bond. Kolker and Goldfine are scheduled to appear in San Francisco on Jan. 21, 2025, for initial proceedings before Magistrate Judge Peter H. Kang. O’Donnell self-surrendered and made her initial appearance in San Francisco on Dec. 16, 2024. She is currently released on $100,000 bond following a hearing before Magistrate Judge Sallie Kim on Dec. 20, 2024. Jasnis remains at large.
United States Attorney Ismail J. Ramsey, Federal Bureau of Investigation (FBI) Special Agent in Charge Robert K. Tripp, Federal Deposit Insurance Corporation, Office of Inspector General (FDIC-OIG) Special Agent in Charge Ryan Korner, and San Francisco Division Inspector in Charge Stephen M. Sherwood of the U.S. Postal Inspection Service (USPIS) made the announcement.
An indictment merely alleges that crimes have been committed. All defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, defendants each face a maximum sentence of five years in prison and a $250,000 fine for each violation of 18 U.S.C. §§ 371 & 1014, conspiracy to make false statements to a bank, 18 U.S.C. §§ 371 & 1960, conspiracy to operate an unlicensed money transmitting business, and 18 U.S.C. § 1960, operation of an unlicensed money transmitting business. Any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant United States Attorney Robert David Rees is prosecuting the case with the assistance of Kay Konopaske and Veronica Hernandez. The prosecution is the result of an investigation by the FBI, FDIC-OIG, and USPIS.
East Bay Man Who Claimed His Marijuana Distribution Business Was A “Nonprofit” Sentenced to over Three Years for Pandemic Relief Loan FraudRead the Press Release
SAN FRANCISCO – A Brentwood man was sentenced yesterday to 37 months in prison for defrauding the United States by obtaining approximately $300,000 in COVID-19 relief funds for his “nonprofit” that was an unlicensed marijuana distribution business. The sentence was handed down by the Honorable Rita F. Lin, U.S. District Judge, following defendant’s guilty plea on two counts of wire fraud.
According to court documents, Thanh Duy Nguyen, 53, ran and was the sole officer of T&A Distribution, an unlicensed interstate marijuana trafficking scheme with grow houses around the Bay Area. Nguyen used T&A Distribution to obtain two Economic Injury Disaster Loans (EIDL) from the U.S. Small Business Administration (SBA). The Coronavirus Aid, Relief, and Economic Security Act authorized the SBA to provide EIDL loans to small businesses experiencing substantial financial disruption due to the COVID-19 pandemic.
In the first application, which he submitted in April 2020, Nguyen certified that he was not engaged in any illegal activity as defined by federal law, even though he knew that his marijuana distribution business was illegal under federal law. Nguyen fraudulently claimed that T&A Distribution was a nonprofit in the business of “Antiques/Collectibles,” when its business was marijuana distribution. Nguyen also made other false statements, including about T&A Distribution’s gross revenue and employee count. The true amount of T&A Distribution’s gross revenues in the 12 months before Jan. 31, 2020, was approximately $2.4 million.
On a second EIDL application, which he submitted in June 2020, Nguyen again falsely certified that he was not engaged in any illegal activity as defined by federal law, and misrepresented T&A Distribution as a nonprofit in the business of “Miscellaneous Services.” He also made false statements about the business’s gross revenues, cost of operations, and employee count.
As a result of the falsified applications, Nguyen received approximately $300,000 in EIDL funds. He used a significant amount of the loan funds for his marijuana distribution business and for gambling.
In addition to the term of imprisonment, Judge Lin sentenced Nguyen to three years of supervised release and to pay $300,000 in restitution and $300,000 in forfeiture. Nguyen will begin serving his sentence on Feb. 28, 2025.
United States Attorney Ismail J. Ramsey, Drug Enforcement Administration (DEA) Special Agent in Charge Bob P. Beris, and SBA Office of Inspector General (OIG) Special Agent in Charge of the Western Region Weston King made the announcement.
This prosecution is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
Assistant United States Attorney Joseph Tartakovsky prosecuted the case with the assistance of Sara Slattery. The prosecution is the result of an investigation by DEA and SBA OIG.
Alleged Fentanyl Trafficker Extradited from Honduras to Face Charges in San FranciscoRead the Press Release
SAN FRANCISCO – The government of Honduras extradited Gustavo Erazo, a Honduran national, to the United States this week to appear on charges stemming from his alleged involvement in a conspiracy to distribute fentanyl, heroin, and cocaine in the San Francisco Bay Area. The extradition marks the sixth extradition of an alleged drug trafficker from Honduras to the Northern District of California this year.
On Jan. 5, 2023, a federal grand jury indicted Erazo, 49, at the time a resident of Oakland, and two other defendants, on charges of conspiring to distribute fentanyl and possessing fentanyl, heroin, and cocaine with the intent to distribute those substances. Erazo was charged in four of the eight counts in the indictment:
CountChargeStatute(s)Statutory Maximum Prison Term1
Conspiracy to Distribute and Possess with Intent to Distribute 400 Grams or More of Fentanyl21 U.S.C. §§ 846 and 841(a)(1), (b)(1)(A)(vi)Life
2
Possession with Intent to Distribute 400 Grams or More of Fentanyl21 U.S.C. § 841(a)(1), (b)(1)(A)(vi)Life
3
Possession with Intent to Distribute 100 Grams or More of Heroin21 U.S.C. § 841(a)(1), (b)(1)(B)(i)40 years
4
Possession with Intent to Distribute 500 Grams or More of Cocaine21 U.S.C. § 841(a)(1), (b)(1)(B)(ii)40 years
According to a criminal complaint filed before the indictment, Erazo was arrested in November 2022 outside an apartment in Berkeley, Calif. At the time of his arrest, Erazo was carrying a backpack in which he had nearly four pounds of suspected drugs, including almost a kilogram of suspected fentanyl and more than half a pound each of suspected heroin and suspected cocaine. Inside the apartment, law enforcement officers found nearly 21 pounds of suspected drugs, including nearly 15 pounds of suspected fentanyl, more than two pounds of suspected cocaine, and more than one pound of suspected heroin. Officers also found drug manufacturing equipment, two firearms, ammunition, and cash inside the apartment.
According to court documents, the Drug Enforcement Administration (DEA) learned after Erazo was charged in federal court that he had traveled back to Honduras. The Justice Department’s Office of International Affairs worked with Honduran authorities and the DEA to secure the arrest and extradition of Erazo, who arrived back in the United States on Dec. 19, 2024. He appeared before U.S. Magistrate Judge Sallie Kim today for arraignment on the indictment and further proceedings. Erazo is next scheduled to appear in court for a status hearing before U.S. Magistrate Judge Lisa J. Cisneros on Dec. 23, 2024.
An indictment merely alleges that crimes have been committed. All defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Erazo faces a maximum sentence of life imprisonment and a maximum fine of $10,000,000 on Counts 1 and 2, and a maximum sentence of 40 years in prison and a maximum fine of $5,000,000 on Counts 3 and 4. He also faces a lifetime term of supervised release and a mandatory $100 special assessment on each count. Any sentence following a conviction would be imposed by a court only upon consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
United States Attorney Ismail J. Ramsey and DEA Special Agent in Charge Bob P. Beris made the announcement.
Assistant U.S. Attorney Nicholas Parker is prosecuting the case with the assistance of Jessie Chelsea and Linda Love. The prosecution is the result of an investigation by the DEA, with assistance from the San Francisco Police Department.
Man Pleads Guilty to Destroying Public Land in Los Padres National Forest Stemming from Unlawful Marijuana CultivationRead the Press Release
SAN JOSE – Jacinto Correa Cruz, 56, a Mexican national, pleaded guilty in federal court this week to one count of depredation against federal lands and one count of manufacture of, and possession with intent to manufacture and distribute, marijuana plants, stemming from his participation in a large-scale illegal cannabis cultivation operation in the Los Padres National Forest.
As part of his plea agreement entered on Dec. 17, 2024, Correa Cruz admitted to damaging federal property by willfully participating in an illegal marijuana grow operation on public lands and knowingly manufacturing marijuana plants. According to court documents, Correa Cruz was arrested in July 2022 during a multi-agency search of a large-scale marijuana cultivation complex in an area of the Los Padres National Forest known as the “Ventana Complex.” The complex is located in the Ventana Wilderness region of the national forest, a federally protected area that is known as a top “biodiversity hotspot” and is home to more threatened and endangered species than any other national forest in California.
The search and investigation of the cultivation site where Correa Cruz was arrested revealed two plots that had been cleared of most native vegetation to make way for approximately 10,000 marijuana plants. Law enforcement also discovered a camp area with a tent and 15 sleeping bags, and a kitchen area with thousands of pounds of trash and dead animal parts.
Significant quantities of hazardous materials and chemicals were also found on site. The illegal marijuana grow also had an irrigation system with two large water structures fed by a hose that was diverting water from a natural source. An environmental damage assessment found that the illegal operation diverted and used approximately 33,780 gallons of water a day in an area that was experiencing severe drought conditions. Furthermore, highly toxic and illegal chemicals, such as carbofuran, methamidophos, and diphacinone, were found on site and detected in the soil and water. These pesticides are known to have killed sensitive and endangered wildlife species throughout California. Fixing the environmental damage to this area cost over $92,540 per site and required a multi-step process spanning over a year.
“The illegal cultivation of marijuana on public land poses significant environmental risks to public lands and wildlife that must be combatted. We will continue to work with our law enforcement partners to prosecute those who abuse natural resources and harm the environment while illegally growing marijuana on federal land,” said United States Attorney Ismail J. Ramsey.
“Disrupting and dismantling the illegal cultivation of marijuana on federal lands remains a top priority for the U.S. Forest Service Law Enforcement and Investigations team. We are committed to protecting our nation’s valuable resources for future generations and ensuring our national forests are safe for recreational use. This allows the public to enjoy these spaces without concerns for their health and safety. Our efforts would not have been possible without the strong cooperation of our partners at the Integral Ecology Research Center, California Department of Fish and Wildlife, and the U.S. Attorney’s Office,” said Brandon Robinson, Special Agent in Charge, U.S. Forest Service (USFS) Law Enforcement and Investigations, Pacific Southwest Region.
“Jacinto Correa Cruz helped poison the pristine lands of the Los Padres National Forest,” said Federal Bureau of Investigation (FBI) San Francisco Special Agent in Charge Robert Tripp. “He now stands accountable for the damage that will take years to heal. We will continue to stand firm with our federal, state, and local partners to keep our lands safe and prevent further depredation.”
Correa Cruz has been in federal custody since Aug. 22, 2022. His sentencing hearing is scheduled for March 4, 2025, before the Honorable Eumi K. Lee, United States District Judge. Defendant faces a maximum statutory penalty for each offense of 20 years in prison and a fine of $1,000,000, plus restitution. Any sentence will be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant United States Attorney Anne C. Hsieh is prosecuting the case with the assistance of Sara Slattery. The prosecution is the result of an investigation by USFS and the FBI, with assistance from the California Department of Fish and Wildlife.
Former FBI Agent Indicted on Charges of Cyberstalking, Witness Tampering, and Obstruction of Criminal InvestigationRead the Press Release
OAKLAND - A federal grand jury has indicted Paul Raymond Flood with cyberstalking, witness tampering, and obstruction of a criminal investigation by bribery. Flood, 54, of Castro Valley, was arrested yesterday and made his initial appearance in federal court this morning.
According to the indictment, which was filed May 16, 2024, and unsealed today, Flood was a Special Agent with the Federal Bureau of Investigation (FBI) from 2007 through 2019. In early October 2018, Flood met a first-year law student, referred to in the indictment as “Victim-1” or “V-1,” who had contacted him for information on pursuing a future career with the FBI. A family member of V-1’s, referred to in the indictment as “B-1,” knew Flood and referred V-1 to him.
Within a few weeks of meeting V-1, Flood allegedly began to make unwelcome romantic advances toward V-1 and engage in a pattern of harassing and intimidating conduct. The indictment charges that, among other conduct, Flood had a diamond ring delivered to V-1 in mid-October 2018; used different numbers and messaging applications to call and text V-1, creating and using at least 79 different numbers between mid-October 2018 through September 2019; sent messages demonstrating that he was surveilling V-1 and her family; and repeatedly pressured B-1 to have V-1 call or unblock Flood.
Although V-1 initially did not report Flood due to her family’s fear of retaliation, V-1 reported him in June 2019 to federal and local law enforcement authorities. Shortly thereafter, the FBI suspended Flood from duty and the Department of Justice Office of the Inspector General (DOJ OIG) opened an investigation into Flood’s conduct. In response, Flood allegedly employed various means to pressure, harass, intimidate, and persuade V-1 to help him by not providing statements or testimony in the investigations against him, including threatening to commit suicide, offering V-1 various bribes, and pressuring V-1’s family members to persuade her not to cooperate with law enforcement. Flood allegedly succeeded in persuading V-1 to help him obstruct the pending investigations. This included V-1’s evading multiple attempts by DOJ OIG investigators to contact her for an interview and to serve her with a federal grand jury subpoena in July 2019. According to the indictment, Flood also persuaded V-1 to agree to enter a sham marriage with him so that she would not have to testify against him, buying her a $17,000 engagement ring in the process. V-1 did not follow through with the sham marriage plan.
The indictment charges Flood with one count of cyberstalking in violation of 18 U.S.C. § 2261A(2)(B), two counts of witness tampering by intimidation, threats, corrupt persuasion, or misleading conduct in violation of 18 U.S.C. §§ 1512(b)(2) and (b)(3), one count of witness tampering by harassment in violation of 18 U.S.C. §§ 1512(d), and one count of obstruction of a criminal investigation by bribery in violation of 18 U.S.C. § 1510(a).
An indictment merely alleges that crimes have been committed. All defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Flood faces a maximum sentence of 20 years in prison on each witness tampering count under 18 U.S.C. § 1512(b), three years in prison on the witness tampering count under 18 U.S.C. § 1512(d), and five years in prison on each count of cyberstalking and obstruction. Any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Flood is currently on conditional release. His next appearance in federal court is scheduled for Jan. 15, 2025.
United States Attorney Ismail J. Ramsey and Zachary Shroyer, Special Agent in Charge of DOJ OIG Western Region, made the announcement.
Assistant United States Attorney Anne C. Hsieh is prosecuting the case with the assistance of Mimi Lam, Lakisha Holliman, and Helen Yee. The prosecution is the result of an investigation by DOJ OIG, with assistance from the FBI and Homeland Security Investigations.
Paul Raymond Flood Indictment
Convicted Felon, Whom Law Enforcement Encountered on Oakland’s “Blade,” Arrested on Firearm Possession ChargeRead the Press Release
OAKLAND – An Oakland man was arrested yesterday on charges of being a felon in possession of a firearm. Jason Nious, 42, made his initial appearance in federal district court this morning.
According to the criminal complaint and court documents unsealed today, Oakland police encountered Nious on Sept. 18, 2024, while searching the 500 block of East 15th Street in Oakland for a different individual who had an active arrest warrant for gun possession. Officers saw Nious standing next to the wanted person and next to a car that was registered to Nious. Officers determined that Nious was a convicted felon, currently on probation. They then searched Nious’s car and found a gun with a live round in the chamber in a bag on the front passenger seat, along with a loaded 10-round magazine. Nious has prior convictions in Alameda County for human trafficking of a minor, providing controlled substances to a minor, and armed robbery.
Nious is next scheduled to appear in federal district court for a detention hearing on Dec. 23, 2024.
As detailed in the criminal complaint, the 500 block of East 15th Street in Oakland is within “the Blade,” an area surrounding International Boulevard between 5th Avenue and 23rd Avenue that is known throughout the Bay Area for its widespread pimping and pandering. The Blade also has seen a significant increase in other violent crimes in recent years. Consequently, this year, the U.S. Attorney’s Office, the Federal Bureau of Investigation (FBI), and the Oakland Police Department have been actively coordinating and increasing enforcement to combat sex trafficking and violent crime in the area.
United States Attorney Ismail J. Ramsey and FBI San Francisco Special Agent in Charge Robert K. Tripp made the announcement.
A criminal complaint merely alleges that crimes have been committed. All defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Nious faces a maximum sentence of 15 years and a fine of $250,000 on the count of being a felon in possession of a firearm in violation of 18 U.S.C. § 922(g)(1). A court would impose any sentence following conviction after considering the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant U.S. Attorney Ivana Djak is prosecuting the case with the assistance of Amala James. The prosecution is the result of an investigation by the FBI and the Oakland Police Department.
Former South Bay High School Coach Arraigned on Charges of Enticement of Minors and Receipt of Child Sexual Abuse MaterialsRead the Press Release
SAN JOSE – Todd Baldwin, a former sports coach, teaching assistant, and operations manager at Valley Christian High School in San Jose, was arraigned in federal court this afternoon on charges of enticement of minors and receipt of child pornography.
Baldwin, 44, currently of Bremerton, Wash., was charged by complaint on Oct. 10, 2024, and by information on Nov. 19, 2024. According to the complaint, Baldwin allegedly persuaded, induced, and enticed two minor boys, both high school students at the time, to produce child sexual abuse materials in exchange for money from December 2022 to August 2023. Baldwin allegedly paid thousands of dollars via mobile payment services to the minor boys and to at least two other students whom Baldwin had recruited to create child sexual abuse materials for resale online. The complaint further alleges that Baldwin designated some of the exploited minors as his “Teacher Assistants.” The information formally charges Baldwin with two counts of enticement of minors in violation of 18 U.S.C. § 2422(b) and two counts of receipt of child pornography in violation of 18 U.S.C. §§ 2252(a)(2) and (b).
An information merely alleges that crimes have been committed. All defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Baldwin faces a maximum sentence of life imprisonment and a minimum sentence of 10 years’ imprisonment, a maximum fine of $250,000, a term of supervised release, and restitution. Any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Baldwin surrendered to federal authorities in San Jose on Oct. 28, 2024, and made his initial appearance in federal court on the same day. He is currently on conditional release. He is next scheduled to appear before the Honorable Beth Labson Freeman, U.S. District Judge, on Feb. 4, 2025.
United States Attorney Ismail J. Ramsey and Federal Bureau of Investigation (FBI) Special Agent in Charge Robert K. Tripp made the announcement.
Assistant United States Attorney Marissa Harris is prosecuting the case with the assistance of Sahib Kaur. The prosecution is the result of an investigation by the FBI and the San Jose Police Department’s Internet Crimes Against Children Squad.
- Baldwin Information
- Baldwin Complaint
Berkeley Man Sentenced to Six Years in Prison for Unlawful Possession of Firearms and AmmunitionRead the Press Release
OAKLAND – A Berkeley man was sentenced this week to 72 months in federal prison for possession of firearm and ammunition by a person convicted of a felony. The Honorable Haywood S. Gilliam, Jr., U.S. District Judge, imposed the sentence following the defendant’s guilty plea on one count of felon in possession of a firearm and one count of felon in possession of ammunition.
According to his plea agreement, Rufus Rogers, 45, admitted to possession of firearms and ammunition when he knew he was a convicted felon. On Feb. 17, 2023, Rogers approached another person outside of a liquor store on San Pablo Avenue in Oakland with a loaded firearm between Rogers’s hands. Rogers followed the other person around the corner and engaged in a verbal altercation. After the other person fired one shot into the air, Rogers raised his gun towards the person and fired three rounds. Rogers also admitted to having multiple firearms in his possession on or about Aug. 2, 2023.
In addition to the term of imprisonment, Judge Gilliam also sentenced Rogers to a three-year period of supervised release and ordered Rogers to forfeit his interest in the recovered firearms and ammunition. The defendant was remanded into custody on Dec. 11, 2024.
United States Attorney Ismail J. Ramsey and Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Special Agent in Charge Jennifer Cicolani made the announcement.
Special Assistant United States Attorney Jillian Harvey is prosecuting the case with the assistance of Amala James. The prosecution is the result of an investigation by ATF.
Former CFO of San Francisco Law Firms Admits to Years-Long Scheme to Steal More Than $1.3 Million from His EmployersRead the Press Release
SAN FRANCISCO – A Palm Springs man pleaded guilty today to one count of bank fraud and one count of money laundering related to a years-long scheme to embezzle more than $1.3 million from his former employers, two San Francisco law firms.
According to court documents, Tony Archuleta-Perkins, 48, formerly of San Francisco, held various roles at the firms, eventually becoming Chief Financial Officer (CFO). As the CFO, Archuleta-Perkins was in a position of trust and had access to the law firms’ payroll systems and end-to-end payments automation platforms. During the course of his employment, Archuleta-Perkins used this access to embezzle funds in various ways.
The primary way that Archuleta-Perkins stole money from the law firms was to cause the firms to make false and fraudulent payments to a non-profit organization he had set up and solely controlled. Archuleta-Perkins admitted to stealing more than $1.1 million using this method. Archuleta-Perkins also embezzled funds from the law firms by falsely adding “one-time reimbursements” to his regular paychecks or special bonus payroll checks through the use of the law firms’ payroll software. He admitted to stealing more than $106,000 using this method. Archuleta-Perkins also admitted that he endorsed a $41,663.69 tax refund check made out to one of the law firms, deposited it into a bank account belonging to the non-profit, and then wrote himself a check for the same amount.
As part of his plea agreement, Archuleta-Perkins admitted that he knew that the principal of one of the law firms was undergoing serious health issues that kept him out of the office, and that the principal’s physical condition made him unusually vulnerable and particularly susceptible to Archuleta-Perkins’s criminal conduct.
In total, Archuleta-Perkins admitted that he was responsible for at least $1,321,752.72 in losses to his victims. Archuleta-Perkins used the stolen money for personal expenses, including payments on a Best Buy credit card.
Archuleta-Perkins pleaded guilty to one count of bank fraud in violation of 18 U.S.C. § 1344(2) and one count of engaging in monetary transactions in property derived from specified unlawful activity (money laundering) in violation of 18 U.S.C. § 1957. He faces a maximum sentence of 30 years in prison as to the bank fraud charge and a maximum sentence of 10 years in prison as to the money laundering charge. A federal district judge will determine and impose a sentence after considering the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553(a).
Archuleta-Perkins, who was arrested on June 28, 2024, remains free on a $500,000 bond and is scheduled to be sentenced on March 26, 2025, at 10:00 a.m. before the Honorable Jacqueline Scott Corley, U.S. District Judge.
U.S. Attorney Ismail J. Ramsey for the Northern District of California and Federal Bureau of Investigation (FBI) San Francisco Special Agent in Charge Robert K. Tripp made the announcement.
Assistant U.S. Attorney Nikhil Bhagat is prosecuting the case with the assistance of Madeline Wachs. The prosecution is the result of an investigation by the FBI.
Bay Area CEO Pleads Guilty to Employment Tax CrimesRead the Press Release
SAN JOSE – A California man pleaded guilty today to not paying employment taxes to the IRS.
According to court documents and statements made in court, John Comeau, of Santa Clara, was the CEO of Vivid, Inc., a company that provided metal coating services across various industries in Campbell and elsewhere. From at least the first quarter of 2010 through the end of 2019, Vivid withheld Social Security, Medicare, and income taxes from the wages paid to its employees. However, Comeau, who was responsible for ensuring those funds were reported and paid to the IRS, did not do so.
In total, Comeau caused a tax loss to the IRS of approximately $1,150,000.
Comeau is scheduled to be sentenced on Apr. 30, 2025, and faces a maximum penalty of five years in prison. He also faces a period of supervised release, restitution, and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
U.S. Attorney Ismail J. Ramsey, Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division, and IRS Criminal Investigation (IRS-CI) Oakland Field Office Special Agent in Charge Linda Nguyen made the announcement.
IRS-CI is investigating the case.
Assistant U.S. Attorney Ilham Hosseini and Trial Attorney Mahana Weidler of the Tax Division are prosecuting the case.
Santa Cruz-Based MS-13 Gang Members Sentenced to over Twenty Years in Prison for Racketeering Conspiracy, Conspiracy to Commit MurderRead the Press Release
SAN JOSE – Erick Escalante-Torres and Jose Noe Ramirez-Avelar, members of the La Mara Salvatrucha gang (better known as MS-13) based in Santa Cruz, were sentenced today to 27 years and 11 months in prison and 22 years in prison, respectively, for racketeering conspiracy, conspiracy to commit murder in aid of racketeering, and other crimes. The sentences were handed down by the Honorable Edward J. Davila, U.S. District Judge, following the defendants’ convictions by guilty plea.
Escalante-Torres, 29, also known as “Deceptico” or “Problematico,” and Ramirez-Avelar, 34, also known as “Chepito” or “Sparky,” were both actively involved in the MS-13 enterprise in Northern California from approximately 2015 to 2017. According to their plea agreements, MS-13 members and associates earn promotions and prestige by committing criminal activities benefitting the gang, including by engaging in violent crimes such as murder and attempted murder of rival gang members.
In the summer of 2016, Escalante-Torres, Ramirez-Avelar, and others began planning to murder a man they believed to be associated with the rival 18th Street gang. Once the gang received approval for the killing from higher-up gang leaders in El Salvador, the group began surveilling the victim’s movements and plotting different ways to kill him. According to court documents, they decided to kill the victim late at night when he would routinely walk to a nearby taqueria to escort home his fiancée who worked the late shift. On Sept. 22, 2016, they executed their plan, fatally shooting the victim on his way to pick up his fiancée. The victim was not actually affiliated with the rival gang.
Both defendants were also involved in other gang shootings. In May and June 2016, Escalante-Torres and Ramirez-Avelar helped destroy the evidence from a murder committed by another Northern California MS-13 clique. In July 2016, Escalante-Torres and others drove into rival gang territory and, after spotting suspected rival gang members, Escalante-Torres fired two shots, hitting one victim in the leg.
“Defendants engaged in murder and other violent crimes to carry out the goals of MS-13, a transnational criminal organization. Their ruthless actions threatened public safety in Santa Cruz,” said United States Attorney Ismail J. Ramsey. “With these sentences, we are sending a strong message to gang members that these crimes will be fully investigated and prosecuted, and justice will be served.”
“This case illustrates the direct threat transnational gang activity is to our communities and the indiscriminate and needless devastation it brings to innocent families,” said Homeland Security Investigations (HSI) San Francisco Special Agent Charge Tatum King. “HSI San Francisco will aggressively pursue individuals engaged in this criminal activity and ensure they face the consequences for their actions. HSI San Francisco appreciates the dedicated work of its special agents together with the U.S. Attorney’s Office and the Santa Cruz Police Department in bringing these individuals to justice.”
Both defendants pleaded guilty on Aug. 19, 2024, to one count of racketeering conspiracy, one count of conspiracy to commit murder in aid of racketeering, and one count of using a firearm in furtherance of a crime of violence resulting in death. Escalante-Torres also pleaded guilty to one count of attempted murder in aid of racketeering and one count of discharge of a firearm in furtherance of a crime of violence.
Judge Davila also sentenced each defendant to a five-year term of supervised release in addition to the terms of imprisonment. Escalante-Torres has been in federal custody since 2018, and Ramirez-Avelar has been in federal custody since 2017. Both defendants began serving their sentences today. In addition to Escalante-Torres and Ramirez-Avelar, 10 other members of the Santa Cruz clique have been convicted and sentenced for their involvement in criminal activity as members of the gang.
Assistant United States Attorneys George Hageman and Aseem Padukone are prosecuting this case with the assistance of Mimi Lam. The prosecution is the result of a years-long investigation by HSI and the Santa Cruz Police Department.
Bay Area Home Health Agency Owner Sentenced to Two Years in Prison for Health Care FraudRead the Press Release
SAN FRANCISCO – Veronica Katz was sentenced today to two years in federal prison and ordered to pay $543,634.34 in restitution for committing health care fraud. The sentence was handed down by the Honorable James Donato, U.S. District Judge.
Katz, 36, of San Francisco, was indicted by a federal grand jury on Oct. 17, 2023, along with two co-defendants. Katz pleaded guilty on Apr. 18, 2024, to one count of health care fraud. Katz was the owner and operator of HealthNow Home Healthcare and Hospice (HealthNow), a home health agency that provided in-home medical care to patients in the Bay Area. HealthNow billed Medicare and private insurance companies for in-home medical care. In the course of operating HealthNow, Katz submitted false documentation to Medicare in order to obtain reimbursements in violation of Medicare’s rules and regulations.
According to Katz’s plea agreement, she participated in a scheme to defraud Medicare that took a number of forms, including using the identities of licensed medical practitioners on electronic medical records and billing information without the practitioners’ knowledge or consent; directing certain individuals to prepare “Start of Care” (SOC) forms even though the individuals were not Registered Nurses (RNs), as required by Medicare; manipulating electronic patient medical records in order to make it appear as if RNs had completed the patient SOCs; and billing Medicare for physical therapy services that Katz knew had not been provided.
In addition, Katz admitted that she took steps to thwart law enforcement’s investigation into HealthNow. In October 2019, Katz met with one of her HealthNow employees, who informed Katz that Federal Bureau of Investigation (FBI) agents had questioned the employee regarding the company’s billing practices and SOC assessments. Katz instructed the employee to lie to the FBI and falsely state that the employee had been trained and supervised by an RN in the course of conducting SOC assessments.
The announcement was made by United States Attorney Ismail J. Ramsey, FBI Special Agent in Charge Robert K. Tripp, and Steven J. Ryan, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services (HHS-OIG).
In addition to the term of imprisonment and restitution, Judge Donato also sentenced Katz to a three-year period of supervised release and ordered her to pay a $50,000 fine. Defendant will begin serving her sentence on Jan. 6, 2025.
Co-defendant Vennesa Herrera pleaded guilty on Aug. 30, 2021, to conspiracy to commit health care fraud and health care fraud, and will be sentenced on Mar. 17, 2025. Co-defendant Simon Katz’s trial is scheduled for May 12, 2025.
Assistant United States Attorney Christiaan Highsmith is prosecuting the case with the assistance of Helen Yee and Mark DiCenzo. The prosecution is the result of a lengthy investigation by the FBI, HHS-OIG, and the California Department of Public Health.
Canadian Man Sentenced to 30 Months in Federal Prison for Telemarketing FraudRead the Press Release
SAN FRANCISCO – Nemr Hallak was sentenced today to 30 months in prison for his role in a large-scale “Yellow Pages” telemarketing fraud scheme that he and others orchestrated from Canada. The sentence was handed down by the Honorable Edward M. Chen, Senior U.S. District Judge.
Hallak, 43, of Quebec, Canada, was indicted by a federal grand jury in 2016 on charges of conspiracy to commit money laundering, conspiracy to commit mail and wire fraud, mail fraud, and wire fraud. He was initially arrested in Greece in 2016, and was re-arrested and extradited to the United States in late 2023. Hallak pleaded guilty to conspiracy to commit mail and wire fraud on Sept. 12, 2024.
In his plea agreement, Hallak admitted that he conspired with co-defendants and others to carry out a “business directory” telemarketing scheme. Using a variety of means, including false and misleading cold calls and false invoices, Hallak and his co-conspirators caused victims to pay for business directory services they neither ordered nor received. Co-defendants Tolga Suatac and Michelina Perna pleaded guilty to conspiracy to commit mail and wire fraud and were sentenced in March 2023. Co-defendant Roberto Mancini’s case is pending.
“The defendant and his co-conspirators devised a scheme that targeted small businesses, misleading those businesses into believing they owed money for fake directory listings,” said United States Attorney Ismail J. Ramsey. “Regardless of where they are operating, fraudsters who cheat and deceive U.S. businesses will be investigated and brought to justice.”
“To protect the public, Postal Inspectors worked closely with the U.S. Attorney’s Office and our partners at the IRS’s Criminal Investigation Division to arrest and prosecute those individuals responsible for fraud schemes committed against small businesses and the public,” said San Francisco Division Inspector in Charge Stephen M. Sherwood of the U.S. Postal Inspection Service (USPIS).
“Nemr Hallak’s sentencing demonstrates IRS-CI’s commitment to bringing to justice those who prey upon American businesses. The intricacy of the telemarketing scheme that victimized thousands of individuals out of more than $5 million was complicated by it largely being run abroad,” said IRS Criminal Investigation (IRS-CI) Oakland Field Office Special Agent in Charge Linda Nguyen. “What Hallak and his co-conspirators did not account for is the global reach of IRS-CI international operations and our partnerships with international law enforcement. We are committed to following the money no matter where it takes us.”
Court documents described that Hallak and others caused shell companies to be formed in Florida and Delaware in the names of nominees, who were paid in cash to be listed as officers and directors of the shell companies but did no meaningful work and did not really control the companies. Many of the shell companies used the term “Yellow Pages” to suggest their operations were legitimate.
According to Hallak’s plea agreement, thousands of victims were cold called and told that they had a pre-existing business relationship with a “Yellow Pages” or other entity formed by members of the conspiracy, that they had previously purchased business directory services from the defendants, and that they owed money for those services. Victims were told that they owed anywhere between $400 and $1,800 for a previously purchased business directory listing, and were sent fake invoices. When such initial misrepresentations were not sufficient to induce payment, some victims were harassed and threatened with legal action and sent additional false invoices with additional charges.
In addition to the terms of imprisonment, Judge Chen sentenced Hallak to three years of supervised release. Hallak was also ordered to pay $5,381,702.86 in restitution. Hallak is currently in federal custody and will begin serving his sentence immediately.
Assistant United States Attorney Lloyd Farnham is prosecuting the case with the assistance of Kathy Tat and Helen Yee. The prosecution is the result of an investigation by USPIS and IRS-CI. The Justice Department’s Office of International Affairs provided critical assistance in securing the extradition of Hallak. The Justice Department thanks the Ministry of Justice of the Hellenic Republic and the Hellenic Police which provided excellent cooperation in the arrest and re-arrest of Hallak and his subsequent extradition.
Three Bay Area Real Estate Professionals Sentenced to Federal Prison for Their Roles in $55 Million Mortgage Fraud ConspiracyRead the Press Release
SAN FRANCISCO – Tjoman Buditaslim, Jose De Jesus Martinez, and Jose Alfonso Tellez were sentenced today to 24 months, 14 months, and 12 months in prison, respectively, for their participation in a mortgage fraud conspiracy. The sentences were handed down by the Honorable Charles R. Breyer, Senior U.S. District Judge.
Buditaslim, 52, of San Francisco, Martinez, 59, of Daly City, Tellez, 27, of San Jose, and a fourth defendant, Travis Holasek, 52, of San Francisco, were indicted in November 2023 on charges of conspiracy to commit wire fraud and wire fraud. All four defendants pleaded guilty to conspiracy to commit wire fraud.
As detailed in court records, from 2018 through 2022, Buditaslim, a licensed real estate broker until his license was revoked in 2019, conspired to originate approximately 102 home loans worth more than $55 million based on false and fraudulent loan application information. Buditaslim obtained home loans for his clients, potential homebuyers, by submitting false loan applications and income information to multiple loan companies. Buditaslim knew that the applicants could not qualify using truthful income information. Unbeknownst to the applicants, Buditaslim created fraudulent documents, including judicial divorce decrees, alimony and child support checks for nonexistent children, bank statements, and loan applications, that falsely inflated the applicants’ income. The loan companies extended home loans to Buditaslim’s clients relying on the falsely inflated income information. Buditaslim and his co-conspirators profited from the conspiracy via payments from escrow when the clients purchased homes or direct payment from the clients. Buditaslim admitted that the Federal Housing Administration (FHA), which insured many of the fraudulently obtained mortgage loans, lost approximately $486,484.38 to keep certain of the loans from going into foreclosure.
According to Martinez’s plea agreement, Martinez, who worked as a licensed real estate agent, directed clients to Buditaslim knowing that Buditaslim would qualify his clients for home loans based on false and fraudulent loan application materials and information. Buditaslim obtained approximately 49 loans for Martinez’s real estate clients totaling about $27.7 million. As the agent for the buyers, Martinez earned nearly $590,000 in real estate broker commissions.
According to Tellez’s plea agreement, Tellez worked as a loan officer at a mortgage company where he received home mortgage loan applications and supporting documentation to determine if applicants qualified for a mortgage based on his employer’s and FHA rules and guidelines. As part of the conspiracy, Tellez helped originate approximately 30 home mortgage loans worth more than $17 million based on what he knew to be false and fraudulent income information. Despite knowing that he was required to stop and flag applications based on false and fraudulent income representations, Tellez knowingly assisted in originating and funding the loans. Tellez earned more than $134,000 in commissions on the 30 fraudulently obtained loans.
“The defendants tried to line their own pockets at the expense of homebuyers, lenders, and federally insured programs. Instead of helping potential homebuyers obtain home loans for which they were qualified, defendants chased loans that should never have been extended,” said United States Attorney Ismail J. Ramsey. “Today’s sentences hold the defendants accountable for their conduct.”
“Justice was served today. People seeking to fulfill their American dream of homeownership must not be victimized,” said Herminia Neblina, Special Agent in Charge of the Federal Housing Finance Agency Office of Inspector General’s Western Region. “FHFA-OIG will continue to aggressively investigate allegations of mortgage frauds and we will always seek to hold such criminal fraudsters accountable in the justice system.”
“The defendants and other co-conspirators engaged in a $55 million mortgage fraud scheme, fabricating material documents to falsely qualify individuals for loans they would not have otherwise qualified for. When individuals commit fraud against federally funded programs, it creates significant risks to the viability of the program and limits the financial resources available to assist hard working Americans with homeownership,” said Acting Special Agent-in-Charge Joshua Stockman with the U.S. Department of Housing and Urban Development (HUD), Office of Inspector General (OIG). “HUD OIG will continue to work with the U.S. Attorney’s Office and its law enforcement partners to vigorously pursue those who seek to profit by abusing HUD-funded programs.”
“To protect the public, Postal Inspectors worked closely with the U.S. Attorney’s Office and our partners at Federal Housing Finance Agency OIG and the U.S. Housing and Urban Development OIG to arrest and prosecute those individuals responsible for fraud schemes committed against businesses and the public,” said San Francisco Division Inspector in Charge Stephen M. Sherwood of the U.S. Postal Inspection Service (USPIS).
In addition to the terms of imprisonment, Judge Breyer sentenced each of the three defendants to three years of supervised release. Buditaslim was also ordered to pay $1,393,018.46 in restitution, Martinez was ordered to pay $840,847.35 in restitution, and Tellez was ordered to pay $858,321.67 in restitution. Buditaslim, Martinez, and Tellez will begin serving their sentences on Feb. 3, 2025. Holasek is scheduled to be sentenced on Dec. 4, 2024.
The case is being prosecuted by the Corporate and Securities Fraud and General Crimes Sections of the U.S. Attorney’s Office. Assistant United States Attorney Christiaan Highsmith is prosecuting the case with the assistance of Lance Libatique. The prosecution is the result of a multi-year investigation by FHFA-OIG, HUD OIG, USPIS, and the California Department of Justice.
Florida Man Pleads Guilty to Multi-Million-Dollar Investment Fraud Schemes and Conspiracy to Launder MoneyRead the Press Release
SAN FRANCISCO – Thomas Aaron Signorelli pleaded guilty today in federal court to one count of bank fraud, two counts of wire fraud, one count of conspiracy to commit wire fraud, one count of theft of government property, one count of destruction of records, and one count of conspiracy to launder money.
Signorelli, 46, of West Palm Beach, Fla., was charged by information on Sept. 19, 2024. In pleading guilty to all seven counts in the information, Signorelli admitted that beginning in January 2021 to around December 2023, he falsely claimed he could assist individuals and entities in need of capital by raising funds, obtaining loans, and securing profitable investments through his company WS Capital, which was registered with the Securities and Exchange Commission. In fact, Signorelli did not raise capital, obtain loans, or secure profitable investments, and instead used the victims’ funds to pay his personal and living expenses, as well as to pay back other victims.
Signorelli engaged in one of the fraud schemes with his co-conspirator David Scott Cacchione. As part of that scheme, Signorelli and Cacchione convinced investors that their money would be used to purchase accounts receivables that did not exist. Rather than use the funds as promised, Signorelli typically shared a portion of the funds with Cacchione and used the remainder to pay personal and living expenses and repay other victims. Through his various schemes, Signorelli defrauded individuals and entities of more than $2,500,000. Signorelli further admitted that he conspired with an attorney in Florida to launder fraud proceeds through the attorney’s client trust account in order to disguise the source and nature of the fraud proceeds.
The plea agreement also describes that, in December 2021, Signorelli was introduced to an individual who claimed to be looking for someone to launder large sums of drug trafficking proceeds. Signorelli offered to use WS Capital accounts to launder the supposed drug trafficking proceeds and accepted approximately $150,000 in government funds from an undercover government agent. Instead of laundering those funds, Signorelli stole the money and used it to pay his personal expenses.
Signorelli further admitted that he caused applications for a Paycheck Protection Program loan and an Economic Injury Disaster Loan to be submitted to the Small Business Administration (SBA) on behalf of a Napa real estate venture that he had formed. Signorelli made false representations about the venture’s revenues, payroll, and employee count in order to obtain over $50,000 in disaster relief loans.
Finally, in August 2022, Signorelli learned that the FBI had obtained a warrant to search his mobile phone. As detailed in his plea agreement, prior to turning in his mobile phone, Signorelli deleted electronic communications on his device in order to obstruct the government’s investigation.
The announcement was made by United States Attorney Ismail J. Ramsey, FBI Special Agent in Charge Robert Tripp, IRS-CI Oakland Field Office Acting Special Agent in Charge Michael Mosley, and Small Business Administration (SBA) Office of Inspector General (OIG) Special Agent in Charge of the Western Region Weston King.
Signorelli remains free on a $200,000 appearance bond imposed on Sept. 20, 2024. His sentencing hearing is scheduled for Mar. 24, 2025 before the Honorable James Donato, U.S. District Court Judge. The maximum statutory penalty for each count is set forth below.
OFFENSE
STATUTE
MAXIMUM PENALTY
Bank Fraud18 U.S.C. § 134430 years’ imprisonment; $1,000,000 fine; 5 years’ supervised release; $100 special assessment; forfeiture and restitutionWire Fraud18 U.S.C. § 134320 years’ imprisonment; $250,000 or twice the gross gain or loss, whichever is greater; 3 years’ supervised release; $100 special assessment; forfeiture and restitutionConspiracy to Commit Wire Fraud18 U.S.C. § 134920 years’ imprisonment; $250,000 or twice the gross gain or loss, whichever is greater; 3 years’ supervised release; $100 special assessment; forfeiture and restitutionTheft of Government Property18 U.S.C. § 64110 years’ imprisonment; $250,000; 3 years’ supervised release; $100 special assessment; forfeiture and restitutionDestruction, Alteration, and Falsification of Records in Federal Investigations18 U.S.C. § 151920 years’ imprisonment; $250,000; 3 years’ supervised release; $100 special assessment; forfeiture and restitutionConspiracy to Launder Money18 U.S.C. § 1956(h)20 years’ imprisonment; $500,000 or twice the value of the property involved in the transaction, whichever is greater; 3 years’ supervised release; $100 special assessment; forfeiture and restitutionHowever, any sentence will be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Signorelli’s co-conspirator Cacchione pleaded guilty on Aug. 14, 2024, and was sentenced by Judge Donato on Nov. 4, 2024, to a 40-month term of imprisonment.
Assistant U.S. Attorney Garth Hire is prosecuting the case. The prosecution is the result of an investigation by the FBI, IRS-CI, and SBA OIG.
San Francisco Man and New York Man Charged in Scheme to Defraud InvestorsRead the Press Release
OAKLAND – A federal grand jury indicted Avi Fogel, now known as Avi King, and Christos Chrestatos each with one count of conspiracy to commit wire fraud and four counts of wire fraud. Fogel was also charged with one count of false writings to a government agency and an additional count of wire fraud.
Fogel, 47, of San Francisco (who was also known as, in addition to Avi King, Aaron Rose, Aaron Rothchild, and Aaron Gilman), self-surrendered on Nov. 7, 2024, and made his initial appearance in federal court in Oakland that same day. Chrestatos, 45, of Long Island, N.Y., also known as Chris Silverman, was arrested today, and made his initial appearance in federal court in the Eastern District of New York.
According to the indictment filed Oct. 3, 2024, and unsealed Nov. 7, 2024, defendants allegedly engaged in an investment fraud scheme wherein they purported to be producers in the entertainment industry with close ties to “A-list” actors, directors, and other celebrities. Fogel allegedly met potential victims in a variety of places, such as dating websites and shared taxi rides. At various times, defendants claimed to be producers at “Universal.” The indictment alleges that the men lied to victims about their ability to arrange investment and product integration deals in feature films, documentaries, and television series when they knew they had no actual connection to the productions and no affiliation with Universal.
Defendants allegedly created entities, including Suzy and the Sock Dragon Media Group, LLC, Rhinoheart Films, LLC, and The Book Media Group, LLC, to entice investors to invest in their fraudulent scheme. According to the indictment, Fogel and Chrestatos fraudulently obtained investments from multiple victims totaling approximately $167,100, and used the funds for purposes other than as represented to investors.
Additionally, the indictment alleges that Fogel submitted a fraudulent loan application to the U.S. Small Business Administration through the Economic Injury Disaster Loan Program, ultimately receiving $52,400. Fogel allegedly claimed that his company, Suzy and the Sock Dragon Media Group, LLC, was engaged in “entertainment services,” had $125,000 in gross revenues and sold $20,000 in goods, amounts that were derived from the money obtained through defendants’ investment fraud scheme.
The announcement was made by United States Attorney Ismail J. Ramsey and Federal Bureau of Investigation (FBI) Special Agent in Charge Robert K. Tripp.
Both defendants were released on bond. Fogel’s next scheduled appearance is on Dec. 9, 2024, for a status hearing before the Honorable Araceli Martínez-Olguín, U.S. District Judge.
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, defendants each face a maximum sentence of 20 years of imprisonment, a fine of $250,000, three years of supervised release, and forfeiture for the charges of conspiracy to commit wire fraud and wire fraud in counts one to five. Additionally, if convicted, Fogel faces a maximum sentence of 30 years of imprisonment, a fine of $250,000, three years of supervised release, and forfeiture for the wire fraud charge in count six, and five years of imprisonment, a fine of $250,000, three years of supervised release, and forfeiture for the false writings to a government agency charge in count seven. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant U.S. Attorney Benjamin K. Kleinman is prosecuting the case with the assistance of Kay Konopaske. The prosecution is the result of an investigation by the FBI.
Avi Fogel Indictment
Three Indiana Residents Charged in Nationwide SIM-Swapping ConspiracyRead the Press Release
OAKLAND – An indictment was unsealed today charging three Indiana residents, Indigo Kiara Graham, Cortez Tarmar Crawford, and Trevon Demar Allen with conspiracy in connection with a SIM-swapping operation.
All three defendants were arrested yesterday and made their initial appearances in federal court in South Bend, Ind.
According to the indictment filed on Nov. 7, 2024, Graham, 27, Crawford, 22, and Allen, 30, all currently of Elkhart, Ind., are alleged to have conspired with each other and with additional co-conspirators to unjustly enrich themselves by targeting victims for SIM (subscriber identity module) swaps. A SIM card is an integrated circuit that stores authentication and other information for devices on mobile phone networks. In a SIM swap, a criminal actor causes the SIM card assigned to a victim’s account with a mobile service provider to be changed to a SIM card controlled by the criminal actor. Upon obtaining control of the SIM card that is attached to the victim’s cell phone service, the criminal actor can impersonate the victim to other service providers (such as email providers, cryptocurrency exchanges, and social media accounts) by using the victim’s cell phone number to receive password reset codes.
The indictment describes how, beginning around April 2023 to around May 2024, the defendants allegedly created fraudulent identification documents in victims’ names, performed SIM swaps in exchange for money, and fraudulently obtained two-factor authentication codes, thereby accessing and stealing victims’ money and data, extorting victims for money in exchange for restoring access to data, and concealing the ill-gotten funds through cryptocurrency transactions. Graham and Crawford are also charged with committing aggravated identity theft in connection with one incident involving both Graham and Crawford and a second incident involving only Crawford at a mobile service provider store in El Cerrito, Calif.
All three defendants were released and ordered to appear on Dec. 4, 2024, for their initial appearances before the Honorable Kandis A. Westmore, U.S. Magistrate Judge.
The announcement was made by United States Attorney Ismail J. Ramsey and Federal Bureau of Investigation (FBI) Special Agent in Charge Robert K. Tripp.
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, each defendant faces a maximum sentence of five years of imprisonment, $250,000 fine, three years of supervised release, $100 special assessment, forfeiture, and restitution for the conspiracy charge in count one; Graham and Crawford also face a mandatory minimum sentence of two years of imprisonment to run consecutively to any other sentence and in addition to the sentence for the underlying felony, $250,000 fine, three years of supervised release, $100 special assessment, and restitution for each count of aggravated identity theft with which they are charged.
However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant U.S. Attorney Michelle J. Kane is prosecuting the case with the assistance of Kathy Tat. The prosecution is the result of an investigation by the FBI.
Indigo Kiara Graham Indictment
Cruise Admits to Submitting A False Report to Influence A Federal Investigation and Agrees to Pay $500,000Read the Press Release
SAN FRANCISCO – Cruise LLC, an autonomous vehicle company based in San Francisco, has agreed to resolve a criminal charge in federal court for providing a false record to National Highway Traffic Safety Administration (NHTSA) with the intent to impede, obstruct, or influence the investigation of a crash involving one of Cruise’s autonomous vehicles. A criminal information filed today charges Cruise with the offense, which Cruise has agreed to resolve through a deferred prosecution agreement and payment of a $500,000 criminal fine.
“Federal laws and regulations are in place to protect public safety on our roads. Companies with self-driving cars that seek to share our roads and crosswalks must be fully truthful in their reports to their regulators,” said Martha Boersch, Chief of the Office of the U.S. Attorney’s Criminal Division.
“Today’s deferred prosecution agreement holds Cruise, LLC and its employees accountable for their lack of candor in a federal regulatory compliance action,” said Cory LeGars, Special Agent-in-Charge, U.S. Department of Transportation Office of Inspector General (DOT-OIG), Western Region. “Together with our law enforcement and prosecutorial partners, we will engage our collective resources to pursue companies and individuals who intentionally circumvent administration of federal regulations.”
The criminal information alleges that Cruise falsified records in a federal investigation under the jurisdiction of NHTSA within the U.S. Department of Transportation. The criminal investigation and prosecution against Cruise is being resolved with a deferred prosecution agreement in which Cruise admits and accepts responsibility for the charge in the information.
According to the agreement, the crash occurred in San Francisco on Oct. 2, 2023, when a Cruise vehicle operating without a driver ran over a pedestrian who had been thrown into the autonomous vehicle’s path by a human-driven vehicle. The Cruise vehicle stopped after running over the pedestrian. However, because its detection system did not detect that a pedestrian was underneath it, the Cruise vehicle then attempted to pull over to the side of the road with the woman underneath it, dragging the woman over 20 feet. Federal regulations require Cruise to report incidents, including crashes involving Cruise autonomous vehicles, to NHTSA. Cruise subsequently filed a report with NHTSA describing the accident that omitted reference to the secondary movement and dragging.
In a videoconference with NHTSA the next morning, Cruise employees provided a verbal summary of the accident that did not include a description of the dragging. The Cruise employees attempted to show a video of the accident that depicted the dragging, but due to technical difficulties, the portion of the video that showed the dragging did not play. That afternoon Cruise submitted a 1-day-report, which specifically required “a written description of the pre-crash, crash, and post-crash details,” to NHTSA. Cruise’s narrative omitted the dragging. That omission rendered the report inaccurate and incomplete in light of NHTSA’s requirements. The same day, Cruise employees provided NHTSA a copy of the video that showed the dragging, but Cruise did not correct the accident report or the disclosure in a later report submitted 10 days after the accident.
Under the deferred prosecution agreement, Cruise is required to pay a $500,000 criminal fine, cooperate with government investigations, implement a Safety Compliance Program, and provide annual reports to the United States Attorney’s Office on implementation and remediation.
If Cruise fails to completely perform or fulfill its obligations under the agreement during the agreement’s three-year term, the U.S. Attorney’s Office can proceed with prosecution of the charged offense.
The government reached this resolution with Cruise based on a number of factors, including the nature and seriousness of the offense conduct; Cruise’s timely notification to the government of an internal investigation and offer of cooperation, after being notified that the government had opened an investigation; Cruise’s cooperation, which included (1) conducting a thorough internal investigation and making the findings of that investigation public; (2) proactively identifying certain issues and facts that would likely be of interest to the government; (3) making factual presentations to the government and sharing information that would not have been otherwise available to the government; (4) sharing certain privileged documents with the government pursuant to a limited waiver of privilege; (5) making available witnesses for interviews by the government; and (6) remedial measures, such as ensuring that employees identified as responsible for the conduct at issue are no longer employed by Cruise, and operation improvements made by Cruise as set forth in the deferred prosecution agreement.
The announcement was made by Martha Boersch, Chief of the Office of the U.S. Attorney’s Criminal Division, Cory LeGars, Special Agent-in-Charge, DOT-OIG, Western Region, and FBI Special Agent in Charge Robert K. Tripp.
Assistant U.S. Attorneys Noah Stern and Lloyd Farnham are prosecuting the case with the assistance of Maryam Beros. The prosecution is the result of an investigation by DOT-OIG and the FBI.
Cruise LLC Agreement
Brazilian Resident Pleads Guilty for Role in Fraudulent Tax Refund SchemeRead the Press Release
SAN FRANCISCO – A South Carolina man currently residing in Brazil pleaded guilty yesterday in federal court to conspiracy to submit a false claim.
According to court documents and statements made in court, Robert Xan Paul, 45, of Sao Paulo, Brazil, conspired with others to defraud the United States by preparing and submitting to the IRS a fraudulent income tax return that claimed a nearly $600,000 refund, which the IRS paid. Paul was a client of O.I.D. Process, a business owned by his co-conspirators that helped others prepare and file individual federal income tax returns that claimed fictitious Original Issue Discount interest income and federal tax withholdings, resulting in fraudulent claims for tax refunds.
To support his refund claim, Paul created fraudulent IRS forms from financial institutions where he had accounts. Those forms falsely indicated that the financial institutions had withheld federal income tax on his behalf.
In total, Paul caused a tax loss to the IRS of $595,110.
Paul pleaded guilty to one count of conspiracy to submit false claims. He is set to be sentenced on Jan. 21, 2025. Paul faces a maximum sentence of 10 years in prison. He also faces a period of supervised release, restitution, and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
First Assistant United States Attorney Patrick D. Robbins, Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division, and IRS Criminal Investigation (IRS-CI) Oakland Field Office Acting Special Agent in Charge Michael Mosley made the announcement.
Assistant U.S. Attorney Michael Pitman and Trial Attorney J. Parker Gochenour of the Tax Division are prosecuting the case. The prosecution is the result of an investigation by IRS-CI.
United States Attorney Announces Participation in Newly Formed Veterans CourtRead the Press Release
SAN FRANCISCO – United States Attorney Ismail J. Ramsey today announced the United States Attorney’s Office’s participation in the Northern District of California’s newly formed Veterans Court (VC). VC is a program for justice-involved veterans that provides a viable and appropriate alternative to incarceration for eligible veteran-defendants.
“We are deeply indebted to the military veterans within the Northern District of California for their service and sacrifice. We recognize, however, that some veterans struggle and come into contact with the federal criminal justice system,” said U.S. Attorney Ramsey. “Where appropriate and consistent with our mission to keep the community safe, Veterans Court offers an alternative to incarceration.”
For veterans who meet the eligibility requirements and are determined to be suitable candidates, VC offers dedicated programming as an alternative to incarceration. VC integrates court supervision and an extensive network of treatment services and community support. The program offers a four-phased structured approach: (1) engagement and assessment; (2) stability and accountability; (3) wellness and community connection; and (4) program transition.
In order to participate in VC, a veteran-defendant must meet the minimum eligibility requirements:
- At least 12 months of service in the U.S. armed forces (Army, Army Reserve, Army National Guard, Navy, Navy Reserve, Air Force, Air Force Reserve, Air National Guard, Marine Corps, Marine Corps Reserve, Coast Guard, Coast Guard Reserve, Space Force), unless discharged early due to a service-connected disability or a reservist/guardsman who served the full period for which he or she was called to active duty.
- Not charged with a sex offense or crimes against minors.
- Not involved in removal proceedings or with an immigration detainer.
Participants must plead guilty in order to participate. Upon determination of suitability for the program, the U.S. Attorney’s Office will schedule a meeting with the defendant and his or her counsel and may offer either a Track I plea agreement (to low to moderate risk defendants) or a Track II plea agreement (to any risk level of defendants). The participant will then begin a tailored, phased program lasting between 12-24 months. For Track I participants who successfully complete all program requirements, the government will move to dismiss the charges. For Track II participants who successfully complete all program requirements, the government will recommend a noncustodial sentence. Participants who do not successfully complete the program will proceed to sentencing in accordance with standard procedures and timelines.
Admission to VC and determination of Track I or Track II eligibility lie solely with the United States Attorney’s Office.
For more information about alternative sentencing programs in the Northern District of California, please see https://www.cand.uscourts.gov/about/court-programs/cap-frequently-asked-questions/.
- Veterans Justice Court Application
- Veterans Court Quick Overview Guide
Owner of San Jose-Based Technology Staffing Firm Pleads Guilty to Visa Fraud, Conspiracy to Commit Visa FraudRead the Press Release
SAN JOSE – Kishore Dattapuram pleaded guilty in federal court this week to visa fraud and conspiracy to commit visa fraud.
Dattapuram, 55, of Santa Clara, and two other defendants, Kumar Aswapathi, 55, of Austin, Tex., and Santosh Giri, 48, of San Jose, were each charged in an indictment filed Feb. 28, 2019, with one count of conspiracy to commit visa fraud and 10 counts of substantive visa fraud. Aswapathi pleaded guilty to all counts on Oct. 19, 2020. Giri pleaded guilty to all counts on Oct. 28, 2024.
Dattapuram and Aswapathi owned and operated Nanosemantics, Inc., a staffing firm headquartered in San Jose that provided skilled employees to technology companies in the Bay Area. Under its agreements with the companies and the employees it placed, Nanosemantics received a commission for workers placed at client companies. Giri worked closely with Nanosemantics and was also the owner of a separate business, LexGiri, a legal process outsourcing firm that served as a “remote-virtual corporate immigration specialist” for companies.
In connection with its staffing work, Nanosemantics regularly submitted H-1B petitions for foreign workers. As described in court records, the H-1B visa program allows foreign workers to obtain temporary authorization to live and work for employers in the United States. In order to secure an H-1B visa, an employer or other sponsor must submit a Form I-129 petition to the United States Citizenship and Immigration Services (USCIS). A petition and associated documentation must confirm the existence and duration of the job waiting for the worker, and describe key details including the wages associated with the position.
In pleading guilty, Dattapuram admitted to working with Aswapathi and Giri to submit fraudulent H-1B applications that falsely represented that foreign workers had specific jobs waiting for them at designated end-client companies when in fact the jobs did not exist. On multiple occasions, Dattapuram paid companies to be listed as end-clients for the foreign workers, even though he knew the workers would never work for those employers. As defendants admitted, the goal of the scheme was to allow Nanosemantics to obtain visas for job candidates before securing jobs for them, thereby allowing Nanosemantics to place those workers with employers as soon as those jobs were available, rather than waiting for the visa application process to conclude, and giving Nanosemantics an unfair advantage over its competitors.
The announcement was made by First Assistant United States Attorney Patrick D. Robbins and Homeland Security Investigations (HSI) Special Agent in Charge Tatum King.
Dattapuram’s sentencing hearing is scheduled for Feb. 24, 2025, before the Honorable Edward J. Davila, U.S. District Judge. Giri’s sentencing hearing is also scheduled for Feb. 24, 2025, before Judge Davila. Aswapathi has a status regarding sentencing on Nov. 25, 2024, before Judge Davila. Each defendant faces a maximum sentence of 10 years in prison and a fine of $250,000 for each visa fraud count, and a maximum sentence of five years in prison and a fine of $250,000 on the conspiracy count. However, any sentence will be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant United States Attorney Sarah Griswold and Special Assistant United States Attorney Johnny James are prosecuting this case with the assistance of Lynette Dixon and Nina Burney. The prosecution is the result of an investigation by HSI, with assistance from USCIS.
San Carlos Fraudster Who Cheated Investors Out of More Than $1 Million Sentenced to over Three Years in Federal PrisonRead the Press Release
SAN FRANCISCO – David Scott Cacchione was sentenced today to 40 months in federal prison for conspiracy to commit wire fraud and wire fraud in connection with an investment fraud scheme and a false federal disaster loan application, and tax evasion. The sentence was handed down by the Honorable James Donato, U.S. District Judge.
Cacchione, 59, of San Carlos, was initially charged by complaint on Jan. 16, 2024, and by superseding information on Aug. 7, 2024. On Aug. 14, 2024, he pleaded guilty to all four counts in the superseding information — one count of conspiracy to commit wire fraud, two counts of wire fraud, and one count of tax evasion in connection with multiple schemes. According to his plea agreement, Cacchione admitted that he and an alleged co-conspirator defrauded multiple investors by convincing them that their money would be used to purchase accounts receivable that did not exist. Instead, Cacchione used the investor funds to pay personal expenses and to reimburse other victims. Cacchione admitted that victim investors were defrauded out of more than $1.13 million in this scheme. As detailed in court documents, in addition to the investment fraud scheme, Cacchione submitted an Economic Injury Disaster Loan application in September 2020 for a company that he falsely claimed had $1 million in revenue and three employees in the 12-month period prior to Jan. 31, 2020. Based on these false statements, Cacchione obtained a $149,900 loan that he used to pay personal expenses.
“The defendant made multiple misrepresentations in order to enrich himself. He did so by convincing multiple individuals to invest in accounts receivable that did not exist and by diverting disaster relief funds intended to help small businesses to a business that was a sham,” said United States Attorney Ismail J. Ramsey. “My office will vigorously investigate and prosecute those who seek to defraud individuals and federal programs.”
“David Cacchione treated other people’s money as his own,” said Federal Bureau of Investigation (FBI) San Francisco Special Agent in Charge Robert Tripp. “He broke promise after promise and paid his own personal expenses instead of investing his victims’ money. Today, however, he learned a lesson in accountability. The FBI is committed to safeguarding the public from fraud schemes and will continue to work alongside our partners to bring perpetrators like Cacchione to justice.”
“White collar crime is not victimless, and today’s sentencing reinforces it does not go unpunished. Mr. Cacchione’s multiple schemes victimized individual investors and preyed upon federal programs designed to help small businesses recover from dire natural disaster impacts,” said IRS Criminal Investigation (IRS-CI) Oakland Field Office Acting Special Agent in Charge Michael Mosley. “IRS-CI stands up for individuals victimized by financial fraudsters and defends the sanctity of benevolent government programs by putting those who willfully abuse them in jail.”
In addition to the 40-month prison term, Judge Donato also ordered defendant to pay more than $1.4 million in restitution, sentenced the defendant to a three-year period of supervised release, and ordered the defendant to forfeit his $450,000 equity stake in a technology company. Defendant has been in custody since Apr. 24, 2024, and will begin serving his sentence immediately.
The announcement was made by United States Attorney Ismail J. Ramsey, FBI Special Agent in Charge Robert Tripp, and IRS-CI Oakland Field Office Acting Special Agent in Charge Michael Mosley.
Assistant United States Attorney Garth Hire is prosecuting the case. The prosecution is the result of an investigation by the FBI and IRS-CI.
Texas Man Who Diverted Funds from Richmond Company for Personal Use Sentenced to One Year in Federal PrisonRead the Press Release
OAKLAND – Neil Divers was sentenced today to 12 months and one day in federal prison for wire fraud and money laundering. The sentence was handed down by the Honorable Jon S. Tigar, U.S. District Judge.
Divers, 66, of Godley, Tex., who previously resided in Chico, Calif., pleaded guilty on July 17, 2024, to one count of wire fraud and one count of money laundering. As described in court documents, in 2015, Divers partially owned and operated Kodiak Precision, Inc. (Kodiak), a machined component manufacturer in Richmond, Calif. According to the plea agreement, based on prior events, in 2016, the other owners of Kodiak imposed certain controls and procedures designed to prevent Divers from taking money from the company without permission from one or more of the other owners. Despite these controls and procedures, in or about July 2016 to about May 2018, Divers devised and executed a scheme to defraud by opening bank accounts in the name of Kodiak on which he was the only signatory without the knowledge or consent of the other owners of Kodiak. Divers admitted that he then caused an employee to instruct certain Kodiak customers to deposit funds owed to Kodiak into those accounts which were named as “Kodiak” accounts but as to which he was the sole authorized signatory.
According to the plea agreement, Divers took and used some of the diverted money to fund his lifestyle and not to benefit the company, including using $38,217.84 from his fraudulent scheme to purchase landscaping services for his home in August 2019.
In addition to the 12 months and one day prison term, Judge Tigar also ordered the defendant to pay restitution in an amount to be determined at a hearing on Jan. 7, 2025, and sentenced him to a three-year period of supervised release. Defendant will begin serving the sentence on Jan. 10, 2025.
The announcement was made by United States Attorney Ismail J. Ramsey and IRS Criminal Investigation (IRS-CI) Oakland Field Office Acting Special Agent in Charge Michael Mosley.
Assistant U.S. Attorney Robert Rees and Special Assistant U.S. Attorney Cynthia Johnson are prosecuting the case with the assistance of Kay Konopaske. The prosecution is the result of an investigation by the IRS-CI.
Lyft to Pay Civil Penalty to Resolve Allegations of Misleading Drivers About Their Potential EarningsRead the Press Release
The Justice Department, together with the Federal Trade Commission (FTC), today announced that Lyft Inc. (Lyft) has agreed to resolve allegations that it made false and misleading statements about how much Lyft drivers would earn. The settlement includes an agreement to pay $2.1 million in civil penalties and a permanent injunction prohibiting such false and misleading earnings claims.
Lyft operates a mobile app ride-hailing platform that connects consumers seeking rides with those who provide rides with their own personal vehicles. Through marketing campaigns and advertisements, Lyft recruits drivers. After a driver is hired, Lyft sets the rates the driver charges and collects a portion of the fare for each ride. In a civil complaint filed in the U.S. District Court for the Northern District of California, the government alleges that, as early as 2021, Lyft made false and misleading claims in its advertising and marketing regarding potential earnings and incentives to be earned by drivers who signed up to drive for Lyft. Lyft allegedly continued these practices even after it received a Notice of Penalty Offenses in October 2021 that placed the company on notice that false and misleading earnings claims were unlawful.
The complaint alleges that Lyft disseminated advertisements promoting specific hourly amounts that drivers throughout the United States could earn. The company, however, did not disclose that the potential hourly amounts were based on the earnings of the top 20% of its drivers. The complaint also further alleges that Lyft also tried to induce drivers to offer more rides by promoting “earnings guarantees,” which guaranteed that drivers would be paid a set amount if they completed a specific number of rides in a certain time. These guarantees allegedly did not clearly disclose that drivers were paid only the difference between what they otherwise earned for the rides and Lyft’s advertised guaranteed amount, rather than receiving the full guaranteed amount in addition to their regular earnings for the rides.
In the stipulated order entered today by the federal district court, Lyft is required to pay a $2,100,000 civil penalty. The order also enjoins Lyft from making any misrepresentations regarding driver earnings and includes other monitoring and reporting provisions aimed at promoting Lyft’s compliance with the order.
“The Justice Department will vigorously enforce the law to stop companies from misleading Americans about their potential earnings in the gig economy,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “We will continue to work with the FTC to stop unfair and deceptive marketing practices.”
“Lyft drivers deserve accurate information about how much they will be paid for the work they do,” said Director Samuel Levine of the FTC’s Bureau of Consumer Protection. “Our settlement with Lyft bans exaggerated earnings claims and underscores the FTC’s commitment to ensuring gig workers are treated fairly.”
Trial Attorney Paulina Stamatelos and Assistant Director Zachary Dietert of the Civil Division’s Consumer Protection Branch, Assistant U.S. Attorney Ekta Dharia for the Northern District of California and Abdiel Lewis and Evan Rose of the FTC’s Bureau of Consumer Protection handled the matter.
For more information about the Consumer Protection Branch and its enforcement efforts, visit www.justice.gov/civil/consumer-protection-branch. For more information about the FTC, visit www.FTC.gov.
Lyft to Pay Civil Penalty to Resolve Allegations of Misleading Drivers About Their Potential EarningsRead the Press Release
SAN FRANCISCO – The Justice Department, together with the Federal Trade Commission (FTC), today announced that Lyft Inc. (Lyft) has agreed to resolve allegations that it made false and misleading statements about how much Lyft drivers would earn. The settlement includes an agreement to pay $2.1 million in civil penalties and a permanent injunction prohibiting such false and misleading earnings claims.
Lyft operates a mobile app ride-hailing platform that connects consumers seeking rides with those who provide rides with their own personal vehicles. Through marketing campaigns and advertisements, Lyft recruits drivers. After a driver is hired, Lyft sets the rates the driver charges and collects a portion of the fare for each ride. In a civil complaint filed in the U.S. District Court for the Northern District of California, the government alleges that, as early as 2021, Lyft made false and misleading claims in its advertising and marketing regarding potential earnings and incentives to be earned by drivers who signed up to drive for Lyft. Lyft allegedly continued these practices even after it received a Notice of Penalty Offenses in October 2021 that placed the company on notice that false and misleading earnings claims were unlawful.
The complaint alleges that Lyft disseminated advertisements promoting specific hourly amounts that drivers throughout the United States could earn. The company, however, did not disclose that the potential hourly amounts were based on the earnings of the top 20% of its drivers. The complaint also further alleges that Lyft also tried to induce drivers to offer more rides by promoting “earnings guarantees,” which guaranteed that drivers would be paid a set amount if they completed a specific number of rides in a certain time. These guarantees allegedly did not clearly disclose that drivers were paid only the difference between what they otherwise earned for the rides and Lyft’s advertised guaranteed amount, rather than receiving the full guaranteed amount in addition to their regular earnings for the rides.
In the stipulated order entered today by the federal district court, Lyft is required to pay a $2,100,000 civil penalty. The order also enjoins Lyft from making any misrepresentations regarding driver earnings and includes other monitoring and reporting provisions aimed at promoting Lyft’s compliance with the order.
“The Justice Department will vigorously enforce the law to stop companies from misleading Americans about their potential earnings in the gig economy,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “We will continue to work with the FTC to stop unfair and deceptive marketing practices.”
“Lyft drivers deserve accurate information about how much they will be paid for the work they do,” said Director Samuel Levine of the FTC’s Bureau of Consumer Protection. “Our settlement with Lyft bans exaggerated earnings claims and underscores the FTC’s commitment to ensuring gig workers are treated fairly.”
Trial Attorney Paulina Stamatelos and Assistant Director Zachary Dietert of the Civil Division’s Consumer Protection Branch, Assistant U.S. Attorney Ekta Dharia for the Northern District of California, and Abdiel Lewis and Evan Rose of the FTC’s Bureau of Consumer Protection handled the matter.
For more information about the Consumer Protection Branch and its enforcement efforts, visit www.justice.gov/civil/consumer-protection-branch. For more information about the FTC, visit www.FTC.gov.
Order by Magistrate Judge Peter H Kang
Alleged San Francisco Gang Members Charged with Racketeering Conspiracy, MurderRead the Press Release
SAN FRANCISCO – A federal grand jury indicted Loel Amador and Eduardo Alvarez with racketeering (RICO) conspiracy and further alleged that a special sentencing factor applies against both defendants for their role in a 2023 murder. The indictment also charged Alvarez with being a felon in possession of a firearm.
According to the indictment filed Oct. 16, 2024, and unsealed today, Amador, aka “Demon,” 28, and Alvarez, aka “Clumsy” aka “Lalo,” 36, both of San Francisco, allegedly conspired to conduct the affairs of a racketeering enterprise referred to as “the 19th Street/16th Street Sureños.” The 19th Street/16th Street Sureños is described as a single, unified enterprise that resulted from the association of two gangs, one that claimed “territory” bounded by 19th Street to the south, 16th Street to the north, Folsom Street to the east, and Dolores Street to the west, and included Dolores Park and Franklin Square Park (also known as Bryant Park), and the other that claimed “territory” centered around 16th Street and Mission Street in San Francisco’s Mission District. The gang allegedly engaged in, among other conduct, murder, narcotics distribution, assault, robbery, and other violent crimes in order to preserve and protect its power, territory, reputation, and profits. The indictment further alleges that, on or about Oct. 7, 2023, Amador and Alvarez murdered a victim in territory claimed by the gang. According to the indictment, on that same date, Alvarez, a convicted felon, possessed a Glock semiautomatic handgun.
This indictment marks the fourth case in the last 10 years in which members of the 19th Street/16th Street Sureños enterprise have been charged with federal racketeering offenses.
Amador was arrested in San Francisco from the custody of the San Francisco County Sheriff, and Alvarez was already in federal custody on a pending petition alleging a violation of supervised release conditions. Alvarez made an initial appearance in federal court in San Francisco earlier this week, and Amador made his initial appearance today. Amador and Alvarez are detained pending further proceedings before U.S. Magistrate Judge Peter H. Kang.
The announcement was made by First Assistant United States Attorney Patrick D. Robbins and Homeland Security Investigations (HSI) Special Agent in Charge Tatum King.
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, defendants each face a maximum sentence of life imprisonment, and a fine of $250,000, plus restitution if appropriate, for each violation of 18 U.S.C. § 1962(d), racketeering conspiracy. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
The Organized Crime Strike Force section of the United States Attorney’s Office is prosecuting this case. The prosecution is the result of a year-long investigation by HSI and the San Francisco Police Department.
Loel Amador Indictment
East Bay Man Sentenced to Two Years in Federal Prison for Fraud and Identity TheftRead the Press Release
OAKLAND – Freddie Lee Davis III, who pleaded guilty to wire fraud and aggravated identity theft, was sentenced to 24 months and a day in federal prison. The sentence was handed down on Oct. 24, 2024, by the Hon. Yvonne Gonzalez Rogers, United States District Judge. Davis’ co-defendant, Sene Malepeai, also pleaded guilty to wire fraud and aggravated identity theft, and has yet to be sentenced.
Davis and Malepeai, both 27, were charged by criminal complaint on June 30, 2023. Davis was remanded to federal custody on Aug. 31, 2023, and has remained in custody since then. Both defendants were charged by superseding information on July 19, 2024, with one count of wire fraud and one count of aggravated identity theft.
The criminal complaint describes that on June 17, 2021, officers responded to a report of a robbery in the parking lot of a Costco in San Leandro. The victim of the robbery was an Asian female (identified in the complaint as “Q.D.”). The robbery took place in the store’s parking lot after the victim exited Costco. As she was walking to her vehicle, a car drove alongside Q.D. and an individual reached out of a window and grabbed hold of her purse from the moving car. Q.D. held onto her purse and was dragged the width of several cars. The car then sped away and Q.D. let go of her purse and fell to the ground, resulting in bodily injuries, including abrasions to her leg and swelling on her hand. Several witnesses heard Q.D. scream, heard her body hit the asphalt, and saw a black Honda speed away from the incident. Surveillance cameras revealed that the car had a license plate number registered to Davis.
On Aug. 1, 2024, Davis pleaded guilty to one count of wire fraud and one count of aggravated identity theft. In Davis’ plea agreement, he acknowledged this robbery and admitted that he received some of the stolen items, including Q.D.’s MasterCard credit card. Davis further admitted that days after the robbery, he knowingly and unlawfully possessed the credit card knowing it belonged to Q.D., and possessed it in relation to a violation of wire fraud. In particular, he and co-defendant Malepeai used Q.D.’s credit card, while misrepresenting Malepeai as the lawful user of the credit card, to fraudulently purchase merchandise at a shoe store in San Leandro and make a number of other fraudulent purchases.
In addition to sentencing Davis to 24 months and a day in federal prison, Judge Gonzalez Rogers ordered him to pay restitution in an amount to be determined and to serve three years of supervised release to begin after his prison term is completed.
“Community members should be able to live their lives without fear of being robbed and having items stolen from them used fraudulently,” said United States Attorney Ismail J. Ramsey. “We will vigorously prosecute these crimes and make sure that defendants like Mr. Davis face serious consequences for their misconduct.”
On Sept. 17, 2024, Davis’ co-defendant Malepeai also pleaded guilty to one count of wire fraud and one count of aggravated identity theft. Malepeai admitted that, on the day of the robbery, she was a passenger in a vehicle with three other individuals. As detailed in Malepeai’s plea agreement, earlier that day, the three other occupants of the vehicle had discussed “going to Chinatown to rob Asian women with purses or jewelry.” They first drove to Chinatown to look for Asians with purses, then went to the parking lot of a retail store, and eventually ended up at a Costco in San Leandro. Two of the occupants in the vehicle had previously stated that they “preferred robbing Asians because they thought they have more money, and because Asians are ‘easy targets’ who don’t fight back,” according to Malepeai’s plea agreement. After the robbery, the three other occupants of the vehicle divided up the stolen goods from Q.D.’s purse, including cash, credit cards, a checkbook, and two cell phones, as Malepeai admitted. Malepeai further admitted to using Q.D.’s credit card, while misrepresenting herself as the lawful user of the credit card, to fraudulently purchase merchandise at a shoe store in San Leandro and make a number of other fraudulent purchases.
Malepeai’s next hearing before Judge Gonzalez Rogers is set for Nov. 7, 2024.
The mandatory minimum penalty for aggravated identity theft is two years in prison, and the maximum statutory penalty for wire fraud is 20 years in prison. However, any sentence following a conviction is imposed by a court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
The announcement was made by U.S. Attorney Ismail J. Ramsey and FBI Special Agent in Charge Robert Tripp.
Assistant United States Attorneys Eric Cheng and Molly Priedeman are prosecuting the case, with assistance from Mimi Lam. The prosecution is the result of an investigation by the FBI with assistance from the San Leandro Police Department.
Alleged Bay Area Fentanyl Distributor Extradited from HondurasRead the Press Release
OAKLAND – The government of Honduras extradited Javier Marin-Gonzales, a Honduran national, to the United States this week to appear on charges stemming from his alleged involvement in the distribution of fentanyl in the San Francisco Bay Area. The extradition marks the fifth extradition of an alleged drug distributor from Honduras to the Northern District of California this year.
On Aug. 2, 2023, a federal grand jury indicted Marin-Gonzales, 25, at the time a resident of Oakland, in connection with the alleged distribution of fentanyl on three separate occasions. The investigation in this case led to charges against multiple East Bay-based defendants who allegedly traveled into the Tenderloin neighborhood of San Francisco to engage in drug dealing.
According to court documents, at the time of the indictment, the Federal Bureau of Investigation (FBI) learned that Marin-Gonzales had traveled back to Honduras. The Justice Department’s Office of International Affairs worked with Honduran authorities, the FBI, and the Drug Enforcement Administration (DEA) to secure the arrest and extradition of Marin-Gonzales. Marin-Gonzales arrived back in the United States on Oct. 23, 2024. He appeared before U.S. Magistrate Judge Kandis A. Westmore today for arraignment on the indictment and further proceedings. A detention hearing for Marin-Gonzales is scheduled for Oct. 30, 2024.
“We appreciate our law enforcement partners’ efforts, here and abroad, to bring to justice those who are charged with peddling deadly drugs in our communities,” said United States Attorney Ismail J. Ramsey.
“This arrest and extradition marks a significant step in our ongoing fight against the distribution of dangerous drugs like fentanyl,” said FBI Special Agent in Charge Robert Tripp. “By bringing Marin-Gonzales to face justice in the United States, we are sending a clear message: those who profit from the trafficking of deadly substances will be held accountable, no matter where they operate. The FBI remains committed to working with our domestic and international partners to disrupt drug networks that threaten the safety and well-being of our communities.”
“We remain steadfast in our commitment to hold accountable drug traffickers operating in the Tenderloin,” said DEA Special Agent in Charge Bob P. Beris. “The extradition of Marin-Gonzales is another example of how strong global partnerships keep our communities safe.”
The indictment charges Marin-Gonzales with the distribution of 40 grams or more of fentanyl, in violation of 21 U.S.C. §§ 841(a)(1), (b)(1)(B)(vi).
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Defendant faces a maximum sentence of 40 years’ imprisonment, a fine of $5,000,000, a lifetime of supervised release, and a $100 special assessment. However, any sentence following a conviction would be imposed by a court only after considerations of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
The announcement was made by U.S. Attorney Ismail J. Ramsey, FBI Special Agent in Charge Robert Tripp, and DEA Special Agent in Charge Bob P. Beris.
This prosecution is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks. Assistant U.S. Attorney Charles Bisesto is prosecuting the case with the assistance of Sara Slattery and Andy Ding. The prosecution is the result of an investigation by the FBI SAFE Streets Task Force, DEA, and the Concord Police Department.
U.S. Attorney Announces Election Day 2024 ProgramRead the Press Release
United States Attorney Ismail J. Ramsey announced today that Assistant United States Attorney (AUSA) Sarah Griswold will lead the efforts of his Office in connection with the Justice Department’s nationwide Election Day Program for the upcoming November 5, 2024, general election. AUSA Griswold has been appointed to serve as the District Election Officer (DEO) for the Northern District of California, and in that capacity is responsible for overseeing the District’s handling of election day complaints of voting rights concerns, threats of violence to election officials or staff, and election fraud, in consultation with Justice Department Headquarters in Washington.
United States Attorney Ramsey said, “Every citizen must be able to vote without interference or discrimination and to have that vote counted in a fair and free election. Similarly, election officials and staff must be able to serve without being subject to unlawful threats of violence. The Department of Justice will always work tirelessly to protect the integrity of the election process.”
The Department of Justice has an important role in deterring and combatting discrimination and intimidation at the polls, threats of violence directed at election officials and poll workers, and election fraud. The Department will address these violations wherever they occur. The Department’s longstanding Election Day Program furthers these goals and also seeks to ensure public confidence in the electoral process by providing local points of contact within the Department for the public to report possible federal election law violations.
Federal law protects against such crimes as threatening violence against election officials or staff, intimidating or bribing voters, buying and selling votes, impersonating voters, altering vote tallies, stuffing ballot boxes, and marking ballots for voters against their wishes or without their input. It also contains special protections for the rights of voters, and provides that they can vote free from interference, including intimidation, and other acts designed to prevent or discourage people from voting or voting for the candidate of their choice. The Voting Rights Act protects the right of voters to mark their own ballot or to be assisted by a person of their choice (where voters need assistance because of disability or inability to read or write in English).
United States Attorney Ramsey stated that: “The franchise is the cornerstone of American democracy. We all must ensure that those who are entitled to the franchise can exercise it if they choose, and that those who seek to corrupt it are brought to justice. In order to respond to complaints of voting rights concerns and election fraud during the upcoming election, and to ensure that such complaints are directed to the appropriate authorities, AUSA/DEO Griswold will be on duty in this District while the polls are open, with the assistance of AUSA Kimberly Hopkins and AUSA Katherine Lloyd-Lovett. They can be reached by the public at the following telephone numbers: AUSA Griswold, (408) 535-5060; AUSA Hopkins, (415) 436-6991; AUSA Lloyd-Lovett, (510) 637-3932.”
In addition, the FBI will have special agents available in each field office and resident agency throughout the country to receive allegations of election fraud and other election abuses on election day. The local FBI field office can be reached by the public at (415) 553-7400.
Complaints about possible violations of the federal voting rights laws can be made directly to the Civil Rights Division in Washington, DC by complaint form at https://civilrights.justice.gov/ or by phone at (800) 253-3931.
United States Attorney Ramsey said, “Ensuring free and fair elections depends in large part on the assistance of the American electorate. It is important that those who have specific information about voting rights concerns or election fraud make that information available to the Department of Justice.”
Please note, however, in the case of a crime of violence or intimidation, please call 911 immediately and before contacting federal authorities. State and local police have primary jurisdiction over polling places, and almost always have faster reaction capacity in an emergency.
Houston Residents Charged with Stealing DoorDash Delivery Workers’ WagesRead the Press Release
OAKLAND – A federal grand jury indicted Oluwatobi Otukelu and Evan Edwards on charges of conspiracy and causing damage to a computer in connection with an alleged scheme to steal wages earned by workers of a delivery service, announced United States Attorney Ismail J. Ramsey and Federal Bureau of Investigation (FBI) Special Agent in Charge Robert K. Tripp. Defendant Otukelu made his first appearance in Oakland to face the charges after having previously appeared with Defendant Edwards in federal court in Houston, Tex.
According to the indictment, Otukelu, 25, and Edwards, 24, both of Houston, conspired to carry out a scheme to defraud DoorDash, Inc. (DoorDash) by fraudulently obtaining wages of independent contractors, called “Dashers,” who made deliveries for the delivery service. As part of this scheme, the co-conspirators allegedly obtained the personal identifying information of Dasher victims; falsely impersonated the Dasher victims to DoorDash support; took over Dashers’ existing online accounts; created new, unauthorized accounts using Dashers’ personal information; and directed payments of Dasher wages from DoorDash to accounts controlled by Otukelu and Edwards. The indictment further alleges that the defendants used the stolen funds to pay for and attempt to pay for goods and services, including vehicles, airline tickets, cosmetic procedures, and personal training. The indictment alleges that Otukelu and Edwards stole the DoorDash wages of at least 138 individual Dashers, amounting to over $1 million.
Otukelu and Edwards were arrested in Houston on Sept. 26, 2024, and made their initial appearances in Houston the same day. Defendant Otukelu was ordered detained pending trial. Defendant Edwards was released on a $25,000 bond. Otukelu’s next scheduled appearance is at 10:30 a.m. on Oct. 22, 2024, for status regarding detention before the Hon. Kandis A. Westmore, U.S. Magistrate Judge. Edwards’ initial appearance in this District has not yet been scheduled.
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, the defendants face the following maximum penalties:
CHARGESTATUTESMAXIMUM STATUTORY PENALTIESConspiracy to Commit Wire Fraud18 U.S.C. § 1349Twenty years of imprisonment; $250,000 fine; three years of supervised release; $100 special assessment; forfeiture; and restitutionConspiracy18 U.S.C. § 371Five years of imprisonment, $250,000 fine; three years of supervised release; $100 special assessment; forfeiture; and restitutionCausing Damage to a Protected Computer18 U.S.C. §§ 1030(a)(5)(A), (c)(4)(A)(i)(I), and (c)(4)(B)(i)Ten years of imprisonment; $250,000 fine; three years of supervised release; $100 special assessment; forfeiture; and restitutionHowever, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant U.S. Attorney Michelle J. Kane is prosecuting the case with the assistance of Kathy Tat. The prosecution is the result of an investigation by the FBI.
Oluwatobi Emmanuel Otukelu Indictment
Chinese National Pleads Guilty to Illegally Exporting Semiconductor Manufacturing MachineRead the Press Release
SAN FRANCISCO – Lin Chen pleaded guilty in federal court today to illegally exporting U.S. technology to a prohibited end user in China, in violation of the International Emergency Economic Powers Act (IEEPA) and the Export Administration Regulations (EAR). The plea was accepted by the Hon. William Alsup, Senior U.S. District Judge.
In pleading guilty, Chen, 65, a citizen of the People’s Republic of China (PRC), admitted to acting on behalf of Jiangsu Hantang International Trade Group Corp., Ltd. (JHI), a company headquartered in Nanjing, PRC, to procure a wafer cutting machine on behalf of Chengdu GaStone Technology Co., Ltd. (GaStone), an entity located in Chengdu, PRC. Chen admitted to knowing that GaStone was designated on the U.S. Department of Commerce’s Entity List on Aug. 1, 2014. Federal regulations restrict the export of certain items to companies, research institutions, and other entities identified on the Department of Commerce’s Entity List. Under applicable Department of Commerce regulations, wafer cutting machines, which are used to cut thin semiconductors used in electronics (also known as silicon wafers), require a license for export to end-users such as GaStone.
According to the plea agreement, by no later than Dec. 4, 2015, Chen knew that GaStone was prohibited from receiving restricted exports without a license, including a DTX-150 Scribe and Break Machine, a machine for processing silicon wafer microchips. On approximately Dec. 10, 2015, Chen worked with a co-defendant to arrange the sale of a DTX-150 to GaStone by shipping it to the PRC in the name of JHI without an export license from Commerce. Chen used JHI’s status as an intermediary to conceal GaStone as the true end-user of the technology.
A federal grand jury indicted Chen on Dec. 1, 2020, charging him with conspiracy to violate IEEPA; submitting false electronic export information; smuggling; and IEEPA violations. Under the plea agreement, Chen pleaded guilty to count four, causing an unlawful export in violation of IEEPA. Defendant currently is released on bond.
Chen’s sentencing hearing is scheduled for January 28, 2025, before the Judge Alsup. The maximum statutory penalty for an IEEPA violation is up to 20 years in prison and a $1 million fine. However, any sentence will be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
United States Attorney Ismail J. Ramsey, Federal Bureau of Investigation (FBI) Special Agent in Charge Robert K. Tripp, Homeland Security Investigations (HSI) Special Agent in Charge Tatum King, and Brent Burmester, U.S. Department of Commerce, Bureau of Industry and Security (BIS) Special Agent in Charge, San Jose Field Office, made the announcement today.
Assistant U.S. Attorney Colin Sampson and Brett Reynolds of the National Security Division’s Counterintelligence and Export Control Section are prosecuting the case with the assistance of Claudia Hyslop and Nina Burney. The prosecution is the result of an investigation by FBI, HSI, and BIS.
Executives of Immigration Services Company Charged in Scheme to Submit Fraudulent Asylum ApplicationsRead the Press Release
SAN FRANCISCO – A federal grand jury indicted Dongquan “Derek” Jin and Yimin “Kelly” Lu with aiding and abetting false statements on asylum applications, announced United States Attorney Ismail J. Ramsey, U.S. Department of State Diplomatic Security Service (DSS) San Francisco Field Office Special Agent in Charge William Chang, and Homeland Security Investigations (HSI) San Francisco Special Agent in Charge Tatum King.
According to an indictment filed Aug. 20, 2024, and unsealed Sept. 19, 2024, Jin and Lu operated Gospel Immigration Service, Inc., a Newark, Calif., corporation that held itself out as providing individuals with assistance in applying for immigration documents and benefits, including asylum.
The indictment alleges that Jin and Lu were listed as the application preparers on more than 200 asylum applications submitted to U.S. Citizenship and Immigration Services (USCIS) between 2013 and 2024. Jin and Lu allegedly provided their clients with sample personal statements describing persecution for use in the clients’ own asylum applications. According to the indictment, it was Jin’s and Lu’s practice to review and edit clients’ personal statements and, in doing so, Jin and Lu would include false and embellished details they believed would increase the clients’ chances of being granted asylum.
The indictment further alleges that, before their clients had their asylum interviews with USCIS, Jin and Lu would instruct their clients to memorize false details in their applications and would also facilitate interview training sessions to increase the odds of a favorable determination. Jin and Lu charged clients at least $5,000 for their assistance and would pressure clients for bonuses, or “red envelopes,” once their clients’ applications were approved.
Defendants are next scheduled to appear in federal court on Oct. 16, 2024, before the Hon. Charles R. Breyer, Senior U.S. District Judge.
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Jin and Lu each face a maximum sentence of 10 years’ imprisonment and a fine of $250,000. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant United States Attorneys Jared S. Buszin and E. Wistar Wilson are prosecuting the case, with assistance from Tina Rosenbaum. The prosecution is the result of an investigation led by the U.S. Treasury Inspector General for Tax Administration and DSS representatives to the Document and Benefit Fraud Task Force (DBFTF), overseen by HSI. The DBFTF is a multi-agency task force that coordinates investigations into fraudulent benefit and immigration documents. USCIS’s Office of Fraud Detection and National Security provided significant assistance with the investigation.
Dongquan Derek Jin Indictment
Four Defendants Charged with Multi-Million-Dollar Fraud Targeting San Francisco Delivery CompanyRead the Press Release
SAN JOSE - A federal grand jury indicted four defendants in an alleged scheme to defraud a San Francisco-based delivery company.
All four defendants were arrested on Oct. 4, 2024. Defendants Sayee Chaitanya Reddy Devagiri, 30, and Manaswi Mandadapu, 29, were arrested in Newport Beach, Calif., made their initial appearances in Santa Ana, and were released on bond. Defendant Matheus Duarte, 29, was arrested in Mountain House, Calif., made his initial appearance in San Jose, and was released on bond. Defendant Hari Vamsi Anne, 30, was arrested in Cypress, Tex., made his initial appearance in Houston, and was detained pending further proceedings.
Each defendant is charged with a single count of conspiracy to commit wire fraud. According to the indictment filed Aug. 7, 2024, and unsealed Oct. 4, 2024, from November 2020 to February 2021, the defendants allegedly worked together to cause the victim company (“Entity One”) to pay for deliveries that never occurred. Entity One’s business includes providing delivery services to customers in response to orders placed using the company’s platform. Drivers fulfill those orders by collecting the ordered items from restaurants and other merchants and delivering them to customers. In furtherance of the scheme, defendants allegedly created fraudulent customer accounts and driver accounts on Entity One’s platform and used the fictitious customer accounts to place orders for delivery. As alleged in the indictment, using insider access to Entity One’s computer systems, defendants assigned those orders to fraudulent driver accounts, then manipulated Entity One’s computer systems to cause Entity One to pay the fraudulent driver accounts as if individual orders had been delivered hundreds of times. The scheme allegedly resulted in fraudulent payments exceeding $2,500,000.
The indictment alleges that the defendants gained access to Entity One’s computer systems using credentials belonging to an employee of Entity One identified as “Individual One.” Individual One is Tyler Thomas Bottenhorn, a resident of Solano County, Calif., who was briefly employed by Entity One in 2020. Bottenhorn was not charged in the indictment unsealed on Oct. 4, but he was separately charged by indictment with conspiracy to commit wire fraud in a federal criminal case filed Sept. 29, 2022, and unsealed Oct. 7, 2024. Bottenhorn pleaded guilty on Nov. 7, 2023, and admitted to being involved in the scheme to defraud Entity One.
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, each defendant faces a maximum sentence of 20 years in prison, and a fine of $250,000, plus restitution if appropriate. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
The announcement was made by U.S. Attorney Ismail J. Ramsey and Federal Bureau of Investigation (FBI) Special Agent in Charge Robert K. Tripp.
This case is being prosecuted by Assistant U.S. Attorneys Michael G. Pitman and Jeffrey D. Nedrow with assistance from Sahib Kaur. The prosecution is the result of an investigation by the FBI.
Sayee Chaitanya Reddy Devagiri Indictment
MS-13 Gang Member Sentenced to over Five Years in Prison for Illegally Possessing Ammunition in A “Ghost Gun”Read the Press Release
SAN FRANCISCO – Christian Quintanilla, a/k/a “Casper,” was sentenced to 63 months in prison for illegally possessing 11 rounds of unfired ammunition near 16th Street and Mission Street in the Mission District of San Francisco, announced First Assistant United States Attorney Patrick D. Robbins and Homeland Security Investigations (HSI) Special Agent in Charge Tatum King. The sentence was handed down by the Hon. Richard Seeborg, Chief United States District Judge.
Quintanilla, 24, of San Pablo, pleaded guilty to the unlawful ammunition possession charge on Mar. 19, 2024. Quintanilla had previously admitted in a plea agreement to being a member of the MS-13 20th Street clique. According to court documents, Quintanilla had been sentenced to 36 months’ imprisonment for his participation in two MS-13 gang-related assaults in San Francisco and was therefore prohibited from carrying either a firearm or ammunition. Nevertheless, as described in court documents, Quintanilla was a passenger in a car with other MS-13 associates that led California Highway Patrol officers on a high-speed chase on June 17, 2023, after which officers located a handgun with a loaded magazine and a round in the chamber in the car. Quintanilla’s involvement in this incident violated the terms of his federal supervised release, which led to the issuance of an arrest warrant. On Sept. 7, 2023, San Francisco Police Department officers encountered Quintanilla near 16th Street and Mission Street in San Francisco. When officers arrested Quintanilla, they found a 9mm Polymer 80 pistol (a “ghost gun”) with an extended magazine containing 11 unfired cartridges of 9mm ammunition.On Oct. 25, 2023, a federal grand jury indicted Quintanilla, charging him with one count of being a felon in possession of ammunition, in violation of 18 U.S.C. § 922(g)(1).
In addition to the 63-month prison term, Chief Judge Seeborg ordered Quintanilla to serve three years of supervised release to begin after his prison term is completed. Chief Judge Seeborg also found that Quintanilla’s possession of the weapon and ammunition violated the terms of his release relating to his August 2021 conviction and revoked his release, imposing a sentence of 24 months’ imprisonment to run concurrently with the 63-month term.
Assistant U.S. Attorneys Aseem Padukone and Andrew Scoble prosecuted the case, with the assistance of Kevin Costello and Yenni Weinberg. The prosecution is the result of an investigation by HSI.
Drug Trafficker Sentenced to 46 Months in Prison for Fentanyl Distribution and Money LaunderingRead the Press Release
OAKLAND – Christian Grajeda-Varela, a Honduran national who pleaded guilty to fentanyl trafficking and money laundering, was sentenced to 46 months in federal prison. The sentence was handed down by the Hon. Haywood S. Gilliam, Jr., United States District Judge.
Grajeda-Varela, 25, was charged by indictment on Aug. 2, 2023, and superseding information on July 15, 2024. He pleaded guilty on July 17, 2024 to distribution of 40 grams or more of fentanyl and to conspiracy to launder monetary instruments.
In his plea agreement, Grajeda-Varela admitted that he sold roughly 1.5 pounds of fentanyl in July 2023 to a drug dealer in the Tenderloin neighborhood of San Francisco. Upon a search of his Oakland residence, federal agents found 109 grams of fentanyl, over six pounds of mannitol (a common mixing agent used to cut or dilute fentanyl), cocaine base, cocaine, and heroin. Agents also found a kilogram press, cutting boards, and tools to cut drugs, supplies that Grajeda-Varela admitted using to dilute and assist with the distribution of drugs.
As described in court documents, multiple WhatsApp messages were found on Grajeda-Varela’s phone containing international wire transfer receipts sent from America Latina, a money service business in Oakland. Grajeda-Varela admitted that, between March and August 2022, he agreed with someone he suspected was involved in the drug trade to commit money laundering by bringing large amounts of cash to America Latina. Specifically, Grajeda-Varela brought over $235,000 in cash to America Latina for the business to wire to recipients in Mexico and Honduras in the form of roughly 125 international wires. According to the plea agreement, each of these international wires was structured and transmitted in an amount below $3,000 to avoid mandatory customer information reporting requirements under federal law.
Grajeda-Varela admitted that he exchanged WhatsApp messages with a woman named “Griselda” who generally accepted the bulk cash he brought in and conducted the international wires for him at America Latina, and that receipts for wires America Latina sent between March and August 2022 were found on his phone as well as on the phone of Griselda Cancelada Liceaga, who owned America Latina.
Grajeda-Varela further admitted that he knew that the owners of America Latina were structuring the bulk cash into wires of less than $3,000 each that were sent under the names of uninvolved persons to make it appear that each wire was an unrelated family/friend remittance.
In a separately charged case, Griselda Cancelada Liceaga, 45, of Oakland, was sentenced to 16 months in federal prison. Liceaga’s sentence was handed down by the Hon. Jeffrey S. White, Senior United States District Judge.
Liceaga was charged by criminal complaint on Aug. 30, 2022, and pleaded guilty to money laundering conspiracy on May 28, 2024. According to her plea agreement, while at her money service business America Latina, Liceaga sent multiple international wire receipts via WhatsApp between March and August 2022 to an individual arrested and prosecuted for drug trafficking. She further admitted to using the names of unrelated persons as the wire senders and did so with the intent to evade the $3,000 transaction reporting requirement under federal law.
According to her plea agreement, Liceaga was familiar with the reporting requirement because she had received anti-money laundering training from the national wire service companies whose wire services she used. Liceaga further admitted that prior to opening America Latina, she had worked at another Oakland money service business, Rincon Musical, where she and her co-workers agreed to structure large cash amounts into wire transactions that were each less than $3,000 that they sent out under the names of unrelated persons.
“We are committed to working with our law enforcement partners to use all tools at our disposal to combat the drug trade in the Northern District of California and beyond,” said United States Attorney Ismail J. Ramsey. “Along with drug traffickers, individuals who engage in and enable the laundering of drug proceeds will be held accountable.”
“Dismantling the profitability of deadly drug trafficking in our communities makes our streets safer and is a core capability of IRS-CI Special Agents. These sentencings highlight the effectiveness of Organized Crime Drug Enforcement Task Force investigations and the relentlessness in which we pursue those perpetuating the lethal drug epidemic,” said IRS Criminal Investigation (IRS-CI) Oakland Field Office Acting Special Agent in Charge Michael Mosley. “Our Special Agents follow the money. When the money leads us to transnational criminal organizations, we build cases that take those criminals off the streets and puts them behind bars.”
“This decisive action, taken in collaboration with our law enforcement partners, disrupts the flow of dangerous drugs and eliminates the financial networks that make this crime possible,” said Federal Bureau of Investigation (FBI) Special Agent in Charge Robert Tripp. “Those who choose to profit from poisoning our communities and endanger public safety will be held accountable. We remain resolute in our mission to dismantle these threats and ensure that justice is served.”
“The cartels would be out of business without drug distributors and money launderers. Christian Grajeda-Varela and Griselda Cancelada Liceaga blatantly violated the law to line their pockets with ill-gotten gains,” said Drug Enforcement Administration (DEA) Special Agent in Charge Bob P. Beris. “We will be relentless in our pursuit of those who put poison in our community and skirt the law by structuring payments of drug proceeds.”
The announcements were made by United States Attorney Ismail J. Ramsey, IRS-CI Oakland Field Office Acting Special Agent in Charge Michael Mosley, FBI Special Agent in Charge Robert Tripp, and DEA Special Agent in Charge Bob P. Beris.
These prosecutions are part of Organized Crime Drug Enforcement Task Force (OCDETF) investigations. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
Assistant United States Attorneys Charles Bisesto and Daniel Pastor prosecuted these cases with assistance from Amanda Martinez and Andy Ding. The prosecution of Grajeda-Varela is the result of an investigation by the FBI and IRS-CI with assistance from the DEA and the Concord Police Department. The prosecution of Cancelada Liceaga is the result of an investigation by IRS-CI and DEA with assistance from the Oakland Police Department.
Former CEO of Tribal Subsidiary Charged with Embezzling over $500,000 from Yurok TribeRead the Press Release
SAN FRANCISCO – A federal grand jury has indicted Jessica Engle on charges that she embezzled from an Indian tribal organization and stole funds from a program receiving federal funds.
Engle, 42, of Gold Hill, Ore., was arrested on Oct. 2, 2024, and made an initial appearance in federal district court in Medford, Ore., that same day. Engle is scheduled to appear before a magistrate judge in San Francisco on Oct. 16, 2024, to face the charges.
According to an indictment filed Sept. 25, 2024, and unsealed Oct. 3, 2024, Engle served as the Chief Executive Officer of the Yurok Telecommunications Corporation, a wholly owned subsidiary of the Yurok Tribe. Between July 2021 and May 2022, Engle allegedly embezzled approximately $579,574 from the Yurok Tribe. In the year preceding Engle’s alleged theft, the Yurok Tribe received over $10,000 in funding from the federal government.
The indictment charges Engle with one count of embezzlement from an Indian tribal organization, in violation of 18 U.S.C. § 1163, and one count of theft from programs receiving federal funds, in violation of 18 U.S.C. § 666.
An indictment merely alleges that crimes have been committed and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Engle faces a maximum statutory penalty of five years in prison for a violation of 18 U.S.C. § 1163 and 10 years in prison for a violation of 18 U.S.C. § 666, and a fine of $250,000 or twice the value of the property involved in the transactions per count. However, any sentence following conviction would be imposed by the Court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
The announcement was made by United States Attorney Ismail J. Ramsey and Federal Bureau of Investigation (FBI) Special Agent in Charge Robert Tripp.
Assistant U.S. Attorney Josiah Bournes is prosecuting this case with the assistance of Soana Katoa. This prosecution is the result of an investigation by the FBI. The U.S. Attorney’s Office and the FBI appreciate the assistance of the Yurok Tribal Police.
Jessica Engle Indictment
Justice Department Disrupts Russian Intelligence Spear-Phishing EffortsRead the Press Release
WASHINGTON – The Justice Department announced today the unsealing of a warrant authorizing the seizure of 41 internet domains used by Russian intelligence agents and their proxies to commit computer fraud and abuse in the United States. As an example of the Department’s commitment to public-private operational collaboration to disrupt such adversaries’ malicious cyber activities, as set forth in the National Cybersecurity Strategy, the Department acted concurrently with a Microsoft civil action to restrain 66 internet domains used by the same actors.
“Today’s seizure of 41 internet domains reflects the Justice Department’s cyber strategy in action – using all tools to disrupt and deter malicious, state-sponsored cyber actors,” said Deputy Attorney General Lisa Monaco. “The Russian government ran this scheme to steal Americans’ sensitive information, using seemingly legitimate email accounts to trick victims into revealing account credentials. With the continued support of our private sector partners, we will be relentless in exposing Russian actors and cybercriminals and depriving them of the tools of their illicit trade.”
“This seizure is part of a coordinated response with our private sector partners to dismantle the infrastructure that cyber espionage actors use to attack U.S. and international targets,” said U.S. Attorney Ismail J. Ramsey for the Northern District of California. “We thank all of our private-sector partners for their diligence in analyzing, publicizing, and combating the threat posed by these illicit state-coordinated actions in the Northern District of California, across the United States, and around the world.”
“This disruption exemplifies our ongoing efforts to expel Russian intelligence agents from the online infrastructure they have used to target individuals, businesses, and governments around the world,” said Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division. “Working closely with private-sector partners such as Microsoft, the National Security Division uses the full reach of our authorities to confront the cyber-enabled threats of tomorrow from Russia and other adversaries.”
“Working in close collaboration with public and private sector partners—in this case through the execution of domain seizures — we remain in prime position to counter and defeat a broad range of cyber threats posed by adversaries,” said FBI Deputy Director Paul Abbate. “Our efforts to prevent the theft of information by state-sponsored criminal actors are relentless, and we will continue our work in this arena with partners who share our common goals.”
“This case underscores the importance of the FBI’s enduring partnerships with private sector companies, which allow for rapid information sharing and coordinated action. With these seizures, we’ve disrupted a sophisticated cyber threat aimed at compromising sensitive government intelligence and stealing valuable information,” said FBI Special Agent in Charge Robert Tripp. “Today’s success highlights the power of collaboration in safeguarding the United States against state-sponsored cybercrime.”
According to the partially unsealed affidavit filed in support of the government’s seizure warrant, the seized domains were used by hackers belonging to, or criminal proxies working for, the “Callisto Group,” an operational unit within Center 18 of the Russian Federal Security Service (the FSB), to commit violations of unauthorized access to a computer to obtain information from a department or agency of the United States, unauthorized access to a computer to obtain information from a protected computer, and causing damage to a protected computer. Callisto Group hackers used the seized domains in an ongoing and sophisticated spear-phishing campaign with the goal of gaining unauthorized access to, and steal valuable information from, the computers and email accounts of U.S. government and other victims.
In conjunction, Microsoft announced the filing of a civil action to seize 66 internet domains also used by Callisto Group actors. Microsoft Threat Intelligence tracks this group as “Star Blizzard” (formerly SEABORGIUM, also known as COLDRIVER). Between January 2023 and August 2024, Microsoft observed Star Blizzard target over 30 civil society entities and organizations – journalists, think tanks, and nongovernmental organizations (NGOs) – by deploying spear-phishing campaigns to exfiltrate sensitive information and interfere in their activities.
The government’s affidavit alleges the Callisto Group actors targeted, among others, United States-based companies, former employees of the United States Intelligence Community, former and current Department of Defense and Department of State employees, United States military defense contractors, and staff at the Department of Energy. In December 2023, the Department announced charges against two Callisto-affiliated actors, Ruslan Aleksandrovich Peretyatko (Перетятько Руслан Александрович), an officer in FSB Center 18, and Andrey Stanislavovich Korinets (Коринец Андрей Станиславович). The indictment charged the defendants with a campaign to hack into computer networks in the United States, the United Kingdom, other North Atlantic Treaty Organization member countries, and Ukraine, all on behalf of the Russian government.
The FBI San Francisco Field Office is investigating the case.
The U.S. Attorney’s Office for the Northern District of California and the Justice Department’s National Security Cyber Section of the National Security Division are prosecuting the case.
The case is docketed at Application by the United States for a Seizure Warrant for 41 Domain Names For Investigation of 18 U.S.C. § 1956(a)(2)(A) and Other Offenses, No. 4-24-71375 (N.D. Cal. Sept. 16, 2024).
An affidavit in support of a seizure warrant and an indictment are merely allegations. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Justice Department Disrupts Russian Intelligence Spear-Phishing EffortsRead the Press Release
The Justice Department announced today the unsealing of a warrant authorizing the seizure of 41 internet domains used by Russian intelligence agents and their proxies to commit computer fraud and abuse in the United States. As an example of the Department’s commitment to public-private operational collaboration to disrupt such adversaries’ malicious cyber activities, as set forth in the National Cybersecurity Strategy, the Department acted concurrently with a Microsoft civil action to restrain 66 internet domains used by the same actors.
“Today’s seizure of 41 internet domains reflects the Justice Department’s cyber strategy in action – using all tools to disrupt and deter malicious, state-sponsored cyber actors,” said Deputy Attorney General Lisa Monaco. “The Russian government ran this scheme to steal Americans’ sensitive information, using seemingly legitimate email accounts to trick victims into revealing account credentials. With the continued support of our private sector partners, we will be relentless in exposing Russian actors and cybercriminals and depriving them of the tools of their illicit trade.”
“This disruption exemplifies our ongoing efforts to expel Russian intelligence agents from the online infrastructure they have used to target individuals, businesses, and governments around the world,” said Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division. “Working closely with private-sector partners such as Microsoft, the National Security Division uses the full reach of our authorities to confront the cyber-enabled threats of tomorrow from Russia and other adversaries.”
"Working in close collaboration with public and private sector partners—in this case through the execution of domain seizures — we remain in prime position to counter and defeat a broad range of cyber threats posed by adversaries,” said FBI Deputy Director Paul Abbate. “Our efforts to prevent the theft of information by state-sponsored criminal actors are relentless, and we will continue our work in this arena with partners who share our common goals.”
“This seizure is part of a coordinated response with our private sector partners to dismantle the infrastructure that cyber espionage actors use to attack U.S. and international targets,” said U.S. Attorney Ismail J. Ramsey for the Northern District of California. “We thank all of our private-sector partners for their diligence in analyzing, publicizing, and combating the threat posed by these illicit state-coordinated actions in the Northern District of California, across the United States, and around the world.”
The domain names are identified below:
accutanebb[.]comSUBJECT DOMAIN NAME 1albuteroltab[.]comSUBJECT DOMAIN NAME 2allowdoorinto[.]comSUBJECT DOMAIN NAME 3baijiapaintbrush[.]comSUBJECT DOMAIN NAME 4baricitinc[.]comSUBJECT DOMAIN NAME 5cbdhempoilww[.]comSUBJECT DOMAIN NAME 6cbdonlineww[.]comSUBJECT DOMAIN NAME 7cenforcep[.]comSUBJECT DOMAIN NAME 8cialismgz[.]comSUBJECT DOMAIN NAME 9delitky[.]comSUBJECT DOMAIN NAME 10divisionintro[.]comSUBJECT DOMAIN NAME 11dompurifycheerio[.]comSUBJECT DOMAIN NAME 12fastloginway[.]comSUBJECT DOMAIN NAME 13fasttruncatedoor[.]comSUBJECT DOMAIN NAME 14finduscore[.]comSUBJECT DOMAIN NAME 15gateallowsearch[.]comSUBJECT DOMAIN NAME 16ghxsjyk[.]comSUBJECT DOMAIN NAME 17gnfamotidine[.]comSUBJECT DOMAIN NAME 18gnibuprofen[.]comSUBJECT DOMAIN NAME 19govdoorsec[.]comSUBJECT DOMAIN NAME 20hempcbdww[.]comSUBJECT DOMAIN NAME 21inthetrustview[.]comSUBJECT DOMAIN NAME 22ithostprotocol[.]comSUBJECT DOMAIN NAME 23ivermectint[.]comSUBJECT DOMAIN NAME 24londonshowcorp[.]comSUBJECT DOMAIN NAME 25maxlliance[.]comSUBJECT DOMAIN NAME 26myavtsim[.]comSUBJECT DOMAIN NAME 27newtransfersearch[.]comSUBJECT DOMAIN NAME 28outviewmachine[.]comSUBJECT DOMAIN NAME 29setitcloud[.]comSUBJECT DOMAIN NAME 30smartloginbreak[.]comSUBJECT DOMAIN NAME 31smartscontract[.]comSUBJECT DOMAIN NAME 32tipstoway[.]comSUBJECT DOMAIN NAME 33toolpointtrim[.]comSUBJECT DOMAIN NAME 34trustvaluespath[.]comSUBJECT DOMAIN NAME 35verificationtrim[.]comSUBJECT DOMAIN NAME 36viewwaypath[.]comSUBJECT DOMAIN NAME 37waylogintexas[.]comSUBJECT DOMAIN NAME 38webgovview[.]comSUBJECT DOMAIN NAME 39wingscamein[.]comSUBJECT DOMAIN NAME 40incomcorporate[.]comSUBJECT DOMAIN NAME 41According to the partially unsealed affidavit filed in support of the government’s seizure warrant, the seized domains were used by hackers belonging to, or criminal proxies working for, the “Callisto Group,” an operational unit within Center 18 of the Russian Federal Security Service (the FSB), to commit violations of unauthorized access to a computer to obtain information from a department or agency of the United States, unauthorized access to a computer to obtain information from a protected computer, and causing damage to a protected computer. Callisto Group hackers used the seized domains in an ongoing and sophisticated spear-phishing campaign with the goal of gaining unauthorized access to, and steal valuable information from, the computers and email accounts of U.S. government and other victims.
In conjunction, Microsoft announced the filing of a civil action to seize 66 internet domains also used by Callisto Group actors. Microsoft Threat Intelligence tracks this group as “Star Blizzard” (formerly SEABORGIUM, also known as COLDRIVER). Between January 2023 and August 2024, Microsoft observed Star Blizzard target over 30 civil society entities and organizations – journalists, think tanks, and nongovernmental organizations (NGOs) – by deploying spear-phishing campaigns to exfiltrate sensitive information and interfere in their activities.
The government’s affidavit alleges the Callisto Group actors targeted, among others, U.S.-based companies, former employees of the U.S. Intelligence Community, former and current Department of Defense and Department of State employees, U.S. military defense contractors, and staff at the Department of Energy. In December 2023, the Department announced charges against two Callisto-affiliated actors, Ruslan Aleksandrovich Peretyatko (Перетятько Руслан Александрович), an officer in FSB Center 18, and Andrey Stanislavovich Korinets (Коринец Андрей Станиславович). The indictment charged the defendants with a campaign to hack into computer networks in the United States, the United Kingdom, other North Atlantic Treaty Organization member countries, and Ukraine, all on behalf of the Russian government.
The FBI San Francisco Field Office is investigating the case.
The U.S. Attorney’s Office for the Northern District of California and the Justice Department’s National Security Cyber Section of the National Security Division are prosecuting the case.
The case is docketed at Application by the United States for a Seizure Warrant for 41 Domain Names For Investigation of 18 U.S.C. § 1956(a)(2)(A) and Other Offenses, No. 4-24-71375 (N.D. Cal. Sept. 16, 2024).
An affidavit in support of a seizure warrant and an indictment are merely allegations. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
San Francisco Man Pleads Guilty to Making Threats to Assault and Murder Federal Probation OfficerRead the Press Release
SAN FRANCISCO – Brandon Sims-White pleaded guilty in federal court today to making threats to sexually assault and murder his United States Probation Officer, announced United States Attorney Ismail J. Ramsey and Acting United States Marshal Jay Bieber. Sims-White has remained in federal custody since making these threats and following his arrest in February 2024.
Sims-White, 41, was originally charged in April 2019 with being a felon in possession of a firearm and ammunition in violation of 18 U.S.C. § 922(g)(1). He was arrested in 2019 and remanded to federal custody. Sims-White pleaded guilty in June 2019 and, in September 2019, the Hon. Charles R. Breyer, Senior U.S. District Judge, sentenced him to 30 months of imprisonment.
According to the criminal complaint filed on Apr. 16, 2024, a United States Probation Officer (identified as “Victim-1”) began supervising Sims-White upon his release from federal custody in March 2021. While Sims-White was under federal supervision, Victim-1 sought warrants on multiple occasions for Sims-White’s arrest, alleging violations of his conditions of supervised release. As described in the criminal complaint and other court documents, Sims-White was arrested multiple times while under federal supervision.
In February 2024, Sims-White appeared again for detention proceedings in federal court in San Francisco and was remanded to federal custody pursuant to a detention order. In his plea agreement, Sims-White admitted that after the February 2024 court proceedings, he knowingly and repeatedly made threats to Victim-1. Specifically, Sims-White repeatedly made threats to kill and sexually assault Victim-1, including in the presence of multiple other individuals. Sims-White also admitted that, further to making the threats to Victim-1, he made additional statements of harm regarding other federal officials.
Following the filing of the criminal complaint, Sims-White was indicted by a federal grand jury on June 18, 2024 on one count of Threatening to Assault, Kidnap, or Murder a United States Official, United States Judge, Federal Law Enforcement Officer, or Other Official in violation of 18 U.S.C. § 115(a)(1)(B).
Judge Breyer scheduled Sims-White’s sentencing for Dec. 18, 2024. Sims-White faces a maximum sentence of 10 years in prison under 18 U.S.C. § 115(a)(1)(B). However, any sentence will be imposed by the Court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
This case is being prosecuted by the National Security & Cyber and General Crimes Sections of the United States Attorney’s Office, and is the result of an investigation by the United States Marshals Service.
Four Leaders of Notorious Nuestra Familia Prison Gang Convicted of Racketeering and Related CrimesRead the Press Release
OAKLAND – A federal jury found David Cervantes (aka “DC”), James Perez (aka “Conejo”), Guillermo Solorio (aka “Capone” aka “Caps”), and George Franco (aka “Puppet”) guilty of racketeering, for their roles as senior members of the Nuestra Familia criminal enterprise, which engaged in murder conspiracies, attempted murder, drug distribution, and money laundering. The jury’s verdict follows a 12-week trial before the Hon. Yvonne Gonzalez Rogers, U.S. District Judge.
“Prison gangs are a blight on the criminal justice system and on society,” said Martha Boersch, Chief of the Office of the U.S. Attorney’s Criminal Division. Prisons are supposed to protect the community from further crime and offer people the chance for rehabilitation, but prison gangs frustrate both goals. They perpetuate violence and criminality inside prisons, and through the use of contraband cell phones, gang leaders are able to oversee vast criminal networks on the streets. Successful prosecutions like this send an unmistakable message that this will not be tolerated simply because it’s happening behind prison walls.”
“These convictions are the culmination of eight years of complex investigative work by the FBI-led Santa Clara County Safe Streets Task Force. Through tireless investigative efforts and collaboration with our law enforcement partners, we have dismantled a core part of this criminal enterprise, whose illicit drug distribution and violent crime have long plagued our community,” said FBI Special Agent in Charge Robert Tripp. “The FBI remains committed to ensuring that those who lead and engage in such violence, no matter where they operate, are brought to justice.”
The evidence at trial established that the four defendants—Cervantes, 76; Perez, 70; Solorio, 45; and Franco, 59 – all were senior members of the Nuestra Familia (NF) prison gang, all serving on the General Council, the primary decision-making body for the gang. Through the testimony of more than 50 witnesses and dozens of wiretapped phone calls, the trial evidence revealed a lucrative and violent criminal enterprise with a presence in every Bay Area county and the roles that each defendant played in it.
The trial evidence established that Cervantes was one of the NF’s three “Generals.” As outlined in the Nuestra Familia’s written Constitution, the three generals sat atop the NF organizational structure and made final decisions on serious matters involving governance of the enterprise. As the sole member of the General Advocates Office, Cervantes oversaw member discipline—a role that at times included deciding when members should be attacked or killed for violating gang rules. Further, the trial evidence established that Cervantes was responsible for (1) receiving “complaints” containing allegations of member wrongdoing within the NF, (2) appointing investigators to look into alleged wrongdoing of gang members, (3) accepting and modifying “findings and recommendations” of the investigators, and (4) forwarding final recommendations regarding member discipline to a seven-member General Council. Cervantes also was the “Regimental Commander” of the NF street gangs in Kings County. As Regimental Commander, Cervantes was responsible for overseeing, managing, directing, and otherwise controlling criminal activity conducted by Norteño street gang members in Kings County. In addition to convicting Cervantes of Racketeering Conspiracy, the jury found Cervantes responsible for the conspiracies to murder Lorenzo “Lencho” Guzman in 2015 and John “Shanks” Reyna in 2019, as well as the attempted murders of Antonio “Sombras” Villagrana in 2015, John “Knockers” Muzquiz in 2016, and Matt Rocha in 2019.
The trial evidence demonstrated Perez was another General of the prison gang, specifically, the “General of Prisons.” In this role, Perez was responsible for maintaining authority over all NF regiments within the California prison system. His responsibilities included appointing NF members and associates to leadership positions within California Department of Corrections and Rehabilitation (CDCR) facilities, as well as overseeing and regulating criminal activity occurring in these facilities. In his role as General of Prisons, Perez collected a portion of profits from the prison regiments. He also was the Regimental Commander of the San Mateo County Street Regiment. In addition to convicting Perez of Racketeering Conspiracy, the jury found Perez responsible for the conspiracy to murder Lorenzo “Lencho” Guzman, as well as the attempted murders of Antonio “Sombras” Villagrana, John “Knockers” Muzquiz, and Matt Rocha.
At trial, the evidence established that Franco was a member of the NF’s “Inner Council” and was Regimental Commander of San Joaquin County. As a member of the Inner Council, Franco was an advisor to the three NF Generals (two of whom were Cervantes and Perez) and was part of the General Council that, in addition to member discipline, made other significant decisions in conducting the affairs of the NF. In addition to convicting Franco of Racketeering Conspiracy, the jury found Franco responsible for the conspiracy to murder Lorenzo “Lencho” Guzman, as well as the attempted murder of Matt Rocha.
Solorio also was part of the NF “Inner Council” and was an advisor to the NF Generals. Solorio also was the Regimental Commander over the Monterey County Street Regiment. The evidence at trial demonstrated Solorio oversaw a prolific drug trafficking operation in Fresno, Calif. In addition to convicting Solorio of Racketeering Conspiracy, the jury found Solorio responsible for the attempted murder of Matt Rocha.
In sum, all four defendants were found guilty of racketeering conspiracy, in violation of 18 U.S.C. § 1962, along with various special findings pertaining to the acts involving murder described above. The maximum statutory sentence for each defendant is life in prison. Judge Gonzalez Rogers scheduled the defendants’ sentencings for Mar. 6, 2025.
The trial of these four defendants marks the culmination of the prosecution of the NF leadership in the Northern District of California. The prosecution stems from a five-year investigation by the FBI, which resulted in the indictment of 54 Nuestra Familia members and associates, including defendants both on the streets and in California state prisons. With the jury’s verdict this week, the government has now obtained convictions of all 7 members of the NF’s General Council, its entire senior leadership team.
This case is being prosecuted by Mari Overbeck, Leif Dautch, and Aseem Padukone of the Organized Crime Strike Force for the United States Attorney’s Office for the Northern District of California. The prosecution is the result of an investigation by the FBI (San Francisco, Sacramento, and Phoenix Divisions), the DEA, the U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives, and the U.S. Marshal Service, with the assistance of the Santa Clara County Sheriff’s Office, the Santa Clara County District Attorney’s Office, and the San Jose Police Department, and with support from the Alameda County Sheriff's Office, Antioch Police Department, Campbell Police Department, Fremont Police Department, King’s County Sheriff’s Office, Monterey County Sheriff’s Office, Mountain View Police Department, Sacramento Police Department, Salinas Police Department, Menlo Park Police Department, Santa Clara County Parole Department, Santa Clara County Probation Department, Santa Clara Police Department, Santa Cruz County District Attorney's Office, Santa Cruz County Sheriff's Office, Modesto Police Department, the California Department of Corrections and Rehabilitation, San Francisco Police Department, the Stanislaus County Sheriff's Department, Sunnyvale Department of Public Safety, and the FBI’s Cryptanalysis and Racketeering Records Unit.
This investigation and prosecution are part of the Organized Crime Drug Enforcement Task Force (OCDETF), which identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
Two Fugitive Tenderloin Drug Traffickers Sentenced to Prison After Being Extradited from HondurasRead the Press Release
SAN FRANCISCO – Two drug dealers who fled to Honduras from the Bay Area while on bond pending federal drug trafficking charges have been extradited to San Francisco and were sentenced to prison terms of 82 months and 34 months, announced U.S. Attorney Ismail J. Ramsey and Drug Enforcement Administration (DEA) Acting Special Agent in Charge Bob P. Beris.
Victor Viera-Chirinos, 42, was one of 14 defendants indicted in August 2019 for trafficking large quantities of heroin, methamphetamine, cocaine base, and cocaine in San Francisco’s Tenderloin neighborhood. Viera-Chirinos was a high-level manager responsible for overseeing portions of the network’s drug trafficking activities. On Apr. 28, 2020, he was ordered released on bond. He pleaded guilty to one count of conspiring to possess and distribute controlled substances in violation of 21 U.S.C. §§ 846, 841(a)(1) and (b)(1)(B). One week prior to his sentencing scheduled for June 2, 2021, Viera-Chirinos fled. The court issued an arrest warrant and federal authorities ultimately found Viera-Chirinos in Honduras. Viera-Chirinos was extradited to the United States and on Sept. 4, 2024, the Hon. Charles R. Breyer, U.S. District Judge, sentenced him, ordering him to serve 82 months in prison.
Mayer Benegas-Medina, 30, was indicted on Dec. 16, 2020, in a separate conspiracy to distribute and possess with intent to distribute fentanyl in the Tenderloin. Benegas-Medina was also ordered released on bond. The terms of his release included electronic monitoring and a curfew. In March 2021, he fled. Federal authorities ultimately found him in Honduras and extradited him to the United States. Benegas-Medina pleaded guilty to the conspiracy charge and on Sept. 24, 2024, the Hon. William H. Alsup, U.S. District Judge, sentenced him to 34 months in prison.
This prosecution is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks. The Justice Department’s Office of International Affairs worked with Honduran authorities to secure the extradition of Viera-Chirinos and Benegas-Medina to the United States.
Assistant U.S. Attorneys Sailaja M. Paidipaty and Dan M. Karmel are prosecuting the case with the assistance of Madeline Wachs. The prosecution is the result of an investigation by DEA.
Former Employee of Global Security and Aerospace Company Charged with Mail Fraud, Theft of Government PropertyRead the Press Release
SAN FRANCISCO – A federal grand jury indicted Omar Naziry, a former employee of a global security and aerospace company, with mail fraud for falsely representing he was in the military to obtain pay and benefits. The defendant made his initial appearance in the Northern District of California on Sept. 25, 2024.
According to an indictment filed July 24, 2024, and unsealed Aug. 22, 2024, Naziry, 40, a resident of Mountain View, Calif., worked for Company 1. Company 1 had a policy under which it paid a differential to any employee who went on military leave. The differential was the difference between the employee’s company pay and military pay. The policy — which was first instituted following the Sept. 11, 2001 terrorist attacks and later expanded to cover all forms of military leave — ensured the employee experienced no reduction in income because of his or her military service.
The indictment alleges that beginning in or around August 2016, Naziry requested differential pay from Company 1 on the purported basis that he was deploying with the U.S. military in support of Operation Inherent Resolve, a U.S. military command established in or about October 2014. In support of his request, Naziry allegedly sent false military orders and a false military leave and earnings statement. Based on these representations, Company 1 awarded Naziry differential pay. Naziry allegedly continued to receive differential pay over the next several years on the purported basis that his deployment had been extended.
In or about December 2021, Company 1 informed Naziry that it was denying his request for additional differential pay on the basis that he had exhausted the five-year differential pay limit. In response, Naziry allegedly caused to be sent a letter to Company 1 authored by a “friend” and “army officer” stationed in Hawaii decrying the decision and claiming that an article would be forthcoming. As detailed in the indictment, the letter stated, “I highly recommend you overturn this decision you’ve made or at least have a plan in place for how to mitigate the negative effects of the story once its [sic] public . . . . I hope you can take timely action to avoid this PR disaster.”
Naziry is charged with a single count of mail fraud. If convicted of mail fraud, he faces a maximum sentence of 20 years in prison and a fine of $250,000.
Naziry is also charged in a separate indictment filed July 24, 2024, and unsealed Aug. 22, 2024 with a single count of theft of government property. According to the indictment, Naziry wrongfully obtained approximately $35,093 in housing assistance payments to which he was not entitled. If convicted, he faces a maximum sentence of 10 years in prison and a fine of $250,000.
However, any sentence following conviction would be imposed by the Court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553. An indictment merely alleges that crimes have been committed and the defendant is presumed innocent unless and until proven guilty.
The announcement was made by U.S. Attorney Ismail J. Ramsey, Bryan D. Denny, Special Agent in Charge for the Department of Defense Office of Inspector General, Defense Criminal Investigative Service (DCIS), Western Field Office, and U.S. Department of Housing and Urban Development, Office of Inspector General (HUD OIG) Special Agent in Charge Mark Kaminsky.
The case is being handled by the Special Prosecutions Section of the U.S. Attorney’s Office for the Northern District of California. Assistant U.S. Attorney Ryan Rezaei is prosecuting the case with the assistance of Amala James and Kevin Costello. The prosecution is the result of an investigation by DCIS and HUD OIG.
- Omar Naziry Indictment Theft
- Omar Naziry Indictment Fraud
San Francisco Software Engineering Manager Convicted of Tax EvasionRead the Press Release
SAN FRANCISCO – A federal jury in San Francisco returned a guilty verdict against Dwayne Lorenzo Richardson on three counts of tax evasion, announced United States Attorney Ismail J. Ramsey and Internal Revenue Service Criminal Investigation (IRS-CI) Acting Special Agent in Charge Michael Mosley. The guilty verdict followed a three-day jury trial before the Honorable William Alsup, Senior U.S. District Judge. A three-count indictment was filed on June 27, 2023, charging Richardson with tax evasion in violation of 26 U.S.C. § 7201.
According to court documents and evidence presented at trial, Richardson, 53, of San Francisco, evaded his personal income taxes for tax years 2017, 2018, and 2019 by claiming to owe only about $28,496 in total tax when he made over $1.2 million as a software engineering manager. Richardson did so by declaring over $1.1 million in medical expenses on his tax returns, overstating those expenses by more than $945,000.
Richardson received tax refunds totaling over $165,000 for the three charged tax years, according to evidence presented at trial. Richardson then lied to an IRS revenue agent in two audit interviews, stating that the $1.1 million of medical expenses were related to an appendectomy. But according to the court record, Richardson paid no more than a few hundred dollars for treatment related to the appendectomy, which took place in 2010, not 2017, 2018, or 2019. As Richardson explained to one of his representatives in the tax audit, Richardson deducted nonexistent medical expenses from his taxes for multiple years because he had not been “caught” the first time he did it.
Assistant United States Attorneys Jared S. Buszin and Ryan Rezaei and Special Assistant United States Attorney Matthew Chou are prosecuting the case, with assistance from Helen Yee. The prosecution is the result of an investigation by IRS-CI.
Richardson’s sentencing hearing is set for Jan. 14, 2025. Richardson faces a maximum statutory penalty of five years in prison and a $100,000 fine on each of the three counts. However, any sentence will be imposed only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Massachusetts Man Sentenced to Five Years in Prison for over $500,000 in Retail TheftRead the Press Release
SAN JOSE – Michael O’Brien, Jr., was sentenced to 60 months in prison for crimes related to fraud, announced United States Attorney Ismail J. Ramsey and United States Secret Service (USSS) Special Agent in Charge Shawn M. Bradstreet. The sentence was imposed by the Honorable Beth Labson Freeman, United States District Judge.
On Apr. 25, 2024, O’Brien, 32, of Worcester, Mass., pleaded guilty to one count of conspiracy to commit wire fraud, in violation of 18 U.S.C. § 1349, and five counts of wire fraud, in violation of 18 U.S.C. § 1343. A grand jury indicted O’Brien on Aug. 3, 2023.
According to court documents, from May 22, 2018 to about Oct. 23, 2018, O’Brien conspired with others to defraud the Target Corporation (Target). O’Brien, who served as the leader of the conspiracy, purchased gift cards from Target, stole the gift card codes, and then sold the codes online. After O’Brien sold the codes, he and others returned the gift cards for a full refund.
O’Brien’s scheme was far reaching, affecting Target stores in California and 35 other states. O’Brien’s scheme involved thousands of gift cards resulting in the theft of at least $508,000. Judge Freeman ordered O’Brien to repay Target $508,000 in restitution. In his plea agreement, O’Brien admitted that the scheme’s intended loss was $1,077,100. In addition to the prison term, Judge Freeman ordered O’Brien to serve three years of supervised release to begin after his prison term is completed.
Assistant United States Attorneys Neal C. Hong and E. Wistar Wilson prosecuted the case. The prosecution is the result of an investigation by USSS and Homeland Security Investigations. The U.S. Attorney’s Office and USSS appreciate the assistance of Target’s Field Investigations Team.
Founder and Former CEO of Artificial Intelligence Start-Up SKAEL Charged with Securities Fraud and Wire FraudRead the Press Release
SAN FRANCISCO – A federal grand jury indicted Baba Nadimpalli, the founder and former Chief Executive Officer of SKAEL, Inc. (SKAEL), with securities and wire fraud for defrauding investors and misleading them about the company’s revenue, annual recurring revenue (ARR), and other financial and sales information.
According to an indictment filed Jan. 17, 2024 and unsealed Sept. 23, 2024, Nadimpalli, 41, a citizen of Australia who resided in San Francisco, Calif., founded SKAEL in 2016 and served as its Chief Executive Officer from 2016 until July 2022. SKAEL was a San Francisco-based, software-as-a-service (“Saas”) company that claimed to provide its corporate clients with artificial intelligence and automation software to assist customers with mundane, time-intensive tasks by building “Digital Employees,” which SKAEL claimed could connect databases, synthesize large amounts of information, provide information and insights, and perform tasks. SKAEL earned revenue by charging implementation fees for the building of Digital Employees and subscription fees for the use of the Digital Employees once they were built.
The indictment alleges that from January 2020 until about February 2022, SKAEL raised over $40 million in three rounds of financing. To induce prospective and existing investors to invest, Nadimpalli allegedly made false claims regarding SKAEL’s revenue and ARR (a measure of total revenue expected per year from committed customers with signed contracts, an important metric for investors), as well as customer and sales information. For example, in or around 2021, Nadimpalli allegedly provided materially false information to investors in advance of their investments in SKAEL, including representing that SKAEL was receiving ARR from certain companies that did not subscribe to SKAEL’s software and services; overstating ARR from certain customers who were SKAEL customers; and representing that customers who had terminated their SKAEL subscriptions were current customers with ARR.
The indictment further alleges that in or around February 2022, SKAEL raised approximately $30 million in a Series A preferred stock offering which valued SKAEL at approximately $230 million after closing. In connection with the stock offering, Nadimpalli allegedly directed the creation of an electronic data room for potential investors that contained (1) a spreadsheet that Nadimpalli maintained that contained materially false information about the company’s ARR and customers; (2) a materially false profit and loss statement; (3) a financial metrics spreadsheet that contained materially false subscription revenue and ARR amounts; and (4) an investor presentation that contained materially false information about the company’s ARR, revenue, and customer adoption.
As described in the indictment, in furtherance of the scheme, Nadimpalli provided an investor and a financial employee false bank account information that included purported customer payments that had not actually been deposited.
Nadimpalli is charged with three counts of securities fraud and seven counts of wire fraud. If convicted of securities fraud, he faces a maximum sentence of 20 years in prison and a fine of $5,000,000. If convicted of wire fraud, he faces a maximum sentence of 20 years in prison and a fine of $250,000. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
An indictment merely alleges that crimes have been committed and the defendant is presumed innocent unless and until proven guilty.
The announcement was made by U.S. Attorney Ismail J. Ramsey and Federal Bureau of Investigation (FBI) Special Agent in Charge Robert K. Tripp.
The case is being handled by the Corporate and Securities Fraud Section of the U.S. Attorney’s Office for the Northern District of California. Assistant U.S. Attorneys Noah Stern and Ilham Hosseini are prosecuting the case with the assistance of Mark DiCenzo. The prosecution is the result of an investigation by the FBI. The U.S. Attorney’s Office and the FBI thank the San Francisco Regional Office of the Securities and Exchange Commission, which announced today a parallel civil enforcement action against Nadimpalli in the Northern District of California.
Baba Nadimpalli indictment
Justice Department Secures Agreement to Resolve Allegations That Former Burlingame Landlord Discriminated Against Family with Two Young ChildrenRead the Press Release
SAN FRANCISCO – The Justice Department announced that it reached a settlement with a former Bay Area landlord to resolve allegations that she discriminated against a couple and their two minor children based on their familial status, in violation of the Fair Housing Act (FHA). Under a consent order that was approved today by the Honorable Maxine M. Chesney, U.S. District Judge, Melinda Bautista Teruel is required to pay $137,500 to the couple.
Teruel sold the Burlingame property after the family’s tenancy. The consent order also requires that, if Teruel acquires another residential rental property over the next three years, she must undergo training on FHA compliance, develop and implement a nondiscrimination policy and complaint procedure, hire a property manager, and submit regular reports concerning her compliance with the order.
“Housing providers must always comply with federal civil rights laws. They cannot discriminate based on national origin, race, or other protected characteristics, including familial status,” said Ismail J. Ramsey, U.S. Attorney for the Northern District of California. “This agreement demonstrates our office’s commitment to enforcing the Fair Housing Act and ensuring that all families have access to fair and inclusive housing.”
“The U.S. Department of Housing and Urban Development (HUD) applauds today’s action and remains committed to working with the Department of Justice to enforce our nation’s fair housing laws,” said Diane M. Shelley, HUD’s Principal Deputy Assistant Secretary for Fair Housing and Equal Opportunity. “We will continue to work with our partners in protecting against harassment and discrimination of families with children.”
Filed on July 17, 2023, the Department’s lawsuit alleges that Teruel managed a two-story, seven-unit apartment complex in Burlingame in which the family resided from 2017 to 2020. According to the complaint, when Teruel learned the couple was expecting their first child, she told them that a one-bedroom apartment is not for families; and when she learned they were expecting their second child, she threatened to evict the family. The lawsuit alleges that Teruel told the couple that families cause more wear and tear and repeatedly pressured them to move from their one-bedroom unit into a larger apartment. The lawsuit also alleges that Teruel falsely claimed damage to the unit after the couple told Teruel that discrimination against families is illegal and that the family vacated the unit because of Teruel’s continuing pressure.
After vacating the apartment, the couple filed a complaint with HUD. Based on its investigation, HUD determined that Teruel violated the FHA by discriminating based on familial status and issued a charge of discrimination. HUD then referred the matter to the Justice Department when the couple chose to have the matter decided in federal court. The matter was handled jointly by Assistant U.S. Attorneys David DeVito and Kelsey Helland for the Northern District of California and the Civil Rights Division.
The Fair Housing Act prohibits discrimination in housing based on race, color, religion, national origin, sex, disability, and familial status (includes making housing unavailable to families with children, making discriminatory statements about them, and harassing tenants because they are pregnant or have young children). More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt. Individuals may report harassment or other forms of housing discrimination to the department by calling 1-833-591-0291, emailing [email protected], or submitting a report online at civilrights.justice.gov. Individuals may also report such discrimination to HUD by calling 1-800-669-9777 or filing a complaint online at www.hud.gov/program_offices/fair_housing_equal_opp/online-complaint.
The claims resolved by the settlement are allegations only. There has been no determination of liability.