Northern District of California
Press releases recorded for this federal judicial district.
East Bay Resident Sentenced to Prison in Securities Fraud SchemeRead the Press Release
OAKLAND – Dileep Kumar Reddy Kamujula was sentenced today to six months in prison, and ordered to forfeit $130,369.28, announced United States Attorney Ismail J. Ramsey and Federal Bureau of Investigation Special Agent in Charge Robert K. Tripp. The sentence was handed down by the Honorable Jon S. Tigar, U.S. District Judge.
Kamujula, 37, of Fremont, pleaded guilty to the charge on November 3, 2023. According to his plea agreement, Kamujula admitted that between April 9 and April 30, 2020, he used confidential Twilio customer usage data when purchasing approximately 167 Twilio call options that he sold on May 7 and May 8, 2020. Kamujula obtained the confidential information from a relative who worked at Twilio and made a profit of more than $550,000 on the transactions.
A federal grand jury indicted Kamujula on March 24, 2022, charging him with securities fraud, in violation of 18 U.S.C. §§ 1348 and 2 (Count One), and 15 U.S.C. §§78j(b) and 78ff, 17 C.F.R. §§ 240.10b-5, 240.10b5-1 (Count Two). Kamujula pleaded guilty to Count Two and Judge Tigar dismissed Count One on the government’s motion at the sentencing hearing.
In addition to the prison term, Judge Tigar also sentenced the defendant to serve a three-year period of supervised release, to begin after the prison term, and ordered the defendant to forfeit $130,369.28. Judge Tigar ordered the defendant to surrender to begin serving his prison term on April 15, 2024.
Assistant U.S. Attorney Garth Hire is prosecuting the case with the assistance of Aarian Beiti. The prosecution is the result of an investigation by the Federal Bureau of Investigation. The U.S. Attorney’s Office appreciates the assistance of the San Francisco Regional Office of the Securities and Exchange Commission and Financial Industry Regulatory Authority (FINRA).
Oakland Resident Charged for Series of Bank RobberiesRead the Press Release
OAKLAND – Naikano Tuipulotu made his initial appearance on February 15, 2024, to face charges presented in a criminal complaint alleging he committed, and attempted to commit, a series of bank robberies in the East Bay, announced United States Attorney Ismail J. Ramsey and Federal Bureau of Investigation, Special Agent in Charge Robert K. Tripp.
According to the complaint affidavit, from October 23, 2023, through January 13, 2024, Tuipulotu, 30, of Oakland, robbed three banks and attempted to rob two others, each in Alameda County. During the robberies and attempted robberies, Tuipulotu passed handwritten notes stating that he had a gun and demanded money from bank tellers. The criminal complaint charges Tuipulotu with bank robbery, in violation of 18 U.S.C. § 2113(a).
Tuipulotu was arrested on February 14, 2024, and made his initial appearance in federal court in Oakland the following day. Tuipulotu remains in custody pending further proceedings in the case. Tuipulotu’s next scheduled appearance is at 10:30 a.m. on February 21, 2024, for status regarding detention before U.S. Magistrate Judge Kandis A. Westmore.
A criminal complaint merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, the defendant faces a maximum sentence of twenty years in prison and a fine of $250,000, plus restitution if appropriate, for a single violation of 18 U.S.C. § 2113(a). 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 Jonah Ross is prosecuting the case. The prosecution is the result of an investigation by the FBI and the San Leandro, Fremont, and Hayward Police Departments.
Former Public University Administrator Sentenced to 20 Months for Diverting $1.5 Million in Student Tuition PaymentsRead the Press Release
SAN FRANCISCO – Sandra (Sandi) Eileen Le was sentenced today to 20 months in prison, and ordered to pay at least $1,536,089.64 in restitution for wire fraud, announced United States Attorney Ismail J. Ramsey and Federal Bureau of Investigation (FBI) Special Agent in Charge Robert K. Tripp. The sentence was handed down by the Hon. William H. Orrick, Senior U.S. District Judge.
Le, 55 of San Francisco, was indicted on August 26, 2021, and pleaded guilty on November 9, 2023, to three counts of wire fraud, in violation of 18 U.S.C. § 1343. According to the plea agreement, Le admitted she was the Academic Program Officer for the University of California, San Francisco (UCSF) School of Nursing’s Post-Master’s and Special Studies Certificate Programs. She abused her position by directing students in those programs to have their tuition checks made out to her, or to a merchandiser she purchased from, or to leave the checks’ payee line blank so she could then make out the checks to herself or her associates. She then deposited the checks into her personal bank accounts, including joint bank accounts that she shared with associates, and used the funds to pay for luxury items from that merchandiser. She also used the funds for gambling, home improvement, and other personal expenses. Le disguised and concealed her misconduct by generating false records of payments and student enrollment for her supervisors at the university. The investigation into her conduct revealed that Le diverted almost 300 such checks from November 2013 through March 2019, totaling $1,536,089.64.
According documents filed by the government in connection with sentencing, the investigation began in May 2019, when Le took a leave of absence while facing increased scrutiny from UCSF’s Audit and Advisory Services Unit, given the school’s inability to reconcile tuition revenues with enrollment in the programs Le administered. The government’s filings describe how, while Le was on leave, a program student provided Le’s replacement a tuition check written out to Le-- the student explained that the payment was per Le’s instructions. Thereafter, investigators conducted interviews of dozens of program students and completed a forensic examination of Le’s bank accounts. This and additional other investigation revealed the extent of Le’s fraud, and corresponding harm to the UCSF School of Nursing community.
Judge Orrick ordered Le to surrender on or before May 10, 2024, to begin serving her 20 month prison term, and found that restitution was at least $1,536,089.64, with the exact amount to be ordered after a further hearing. In addition to the prison term, Judge Orrick also ordered Le to serve a three-year period of supervised release.
Assistant U.S. Attorney Daniel N. Kassabian is prosecuting the case with the assistance of Veronica Hernandez. The prosecution is the result of an investigation by the FBI and the UCSF Police Department.
Three Members of Northern California Drug Trafficking Groups Convicted at TrialRead the Press Release
SAN FRANCISCO – A federal jury has convicted three defendants—Luis Torres Garcia, Evan Martinez Diaz, and Timothy Peoples—of multiple drug trafficking offenses following an eight-day trial, announced United States Attorney Ismail J. Ramsey and Drug Enforcement Administration (DEA), San Francisco Field Division, Special Agent in Charge Brian M. Clark. The jury convicted the defendants on all counts, rendering its verdict on February 14, 2024, after deliberating for two hours. The verdict followed a trial before the Hon. Richard Seeborg, Chief U.S. District Judge for the Northern District of California.
The evidence at trial included calls intercepted between April 2018 and February 2019 as part of a federal wiretap investigation into two drug suppliers in the East Bay. The intercepted calls established, among other things, that both suppliers received drugs from sources in Mexico. At trial, the government also presented evidence of several significant drug seizures including: 8.8 pounds of fentanyl and heroin in May 2018, valued at as much as $1.1 million, according to uncontested evidence at trial; 18 pounds of methamphetamine in August 2018; and 20 pounds of methamphetamine and one kilogram of cocaine in February 2019. The evidence at trial also established that law enforcement seized more than $300,000 in drug-related cash over the course of the investigation.
Torres Garcia, 38, of Rio Dell, California, was charged with conspiracy to distribute methamphetamine, in violation of 21 U.S.C. §§ 846 and 841(a)(1) and (b)(1)(A). The evidence at trial showed that Torres Garcia was a Humboldt County drug trafficker, who used the nickname “Guero.” Torres Garcia received methamphetamine shipments on credit from a Fairfield, California-based drug supplier. On August 8, 2018, the Fairfield supplier attempted to send about 18 pounds of methamphetamine—valued at $158,000—to Torres Garcia in Humboldt County. DEA agents and the Sonoma County Sheriff’s Office intercepted the drug courier and seized the drugs during a vehicle stop on Highway 101 near Healdsburg, California. In February 2019, the DEA tracked Torres Garcia to a meeting in Windsor, California, where Torres Garcia delivered about $13,800 in cash to a courier for his drug supplier. Although he was present throughout the trial and listened to closing arguments, Torres Garcia absconded before the jury handed down its verdict; he is now a fugitive.
Martinez Diaz, 31, of Bay Point, California, was charged with three counts—conspiracy to distribute methamphetamine and cocaine, in violation of 21 U.S.C. §§ 846 and 841(a)(1) and (b)(1)(B); possession with intent to distribute methamphetamine, in violation of 21 U.S.C. § 841(a)(1) and (b)(1)(B); and possession with intent to distribute cocaine, in violation of 21 U.S.C. § 841(a)(1) and (b)(1)(B). The evidence at trial established, among other things, that on February 9, 2019, Martinez Diaz was transporting about 20 pounds of methamphetamine and one kilogram of cocaine through a residential neighborhood in Antioch, California, when he realized he was being followed by law enforcement—which knew about the drugs through intercepted calls. Martinez Diaz began driving erratically, briefly evading law enforcement and directing a co-conspirator to discard the drugs he was carrying in the bushes on a residential street. A short time later law enforcement located the drugs, which evidence at trial established had street retail values of $177,860 (methamphetamine) and $40,000 (cocaine). After Martinez Diaz was stopped by police and released with a traffic citation, he was intercepted on a call telling his supplier that he had seen law enforcement and discarded the drugs to avoid arrest.
Peoples, 44, of Antioch, California, was arrested after law enforcement officers found cocaine in his home, and charged with two counts of possession with intent to distribute cocaine, in violation of 21 U.S.C. § 841(a)(1) and (b)(1)(B)–(C). Evidence presented at trial showed that Peoples was a regular customer of an Antioch-based cocaine wholesaler from whom he bought some 10.5 pounds of cocaine for more than $120,000 in a 90-day period. Peoples used the codeword “babies” to refer to ounce quantities of cocaine. The evidence at trial established that Peoples then sold cocaine to his own customers in smaller quantities and used his proceeds to buy expensive cars.
Judge Seeborg scheduled a sentencing hearing for June 11, 2024. Torres Garcia faces a maximum sentence of life imprisonment and a minimum sentence of 10 years in prison. Martinez Diaz and Peoples each face a maximum sentence of 20 years in prison for every count on which they were convicted. However, the defendants’ sentences 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.
This prosecution is part of an Organized Crime Drug Enforcement Task Force (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. Attorneys Daniel Pastor and Joseph Tartakovsky prosecuted the case with the assistance of Erick Machado. This prosecution is the result of an investigation led by the DEA Oakland Resident Office, with assistance from the Bureau of Alcohol, Tobacco, Firearms, and Explosives; Homeland Security Investigations; U.S. Customs and Border Protection; U.S. Postal Inspection Service; the police departments in Fairfield, Antioch, Concord, and Oakland; the Sonoma County Sheriff’s Office; and the California Highway Patrol.
Tenderloin Fentanyl Dealer Armed with Ghost Gun Sentenced to More Than Six Years in PrisonRead the Press Release
SAN FRANCISCO – Esmun Moyses Moral-Raudales was sentenced yesterday to 80 months in prison for crimes including distribution of, and possession with intent to distribute, fentanyl and methamphetamine, announced United States Attorney Ismail J. Ramsey and Drug Enforcement Administration (DEA), San Francisco Field Division, Special Agent in Charge Brian M. Clark. The sentence was handed down by the Hon. James Donato, United States District Judge.
Moral-Raudales, 28, a citizen of Honduras, pleaded guilty in October 2023 to two counts of distributing methamphetamine and one count of distributing fentanyl, all in violation of 21 U.S.C. § 841(a)(1) and (b)(1)(C). He also pleaded guilty to one count of possessing 40 grams or more of fentanyl with intent to distribute it, in violation of 21 U.S.C. § 841(a)(1) and (b)(1)(B)(vi).
According to his plea agreement, Moral-Raudales admitted that, during two drug deals in the Tenderloin in January and February 2023, he sold a total of 103.8 grams (gross weight) of fentanyl and 95 grams (gross weight) of methamphetamine. He also admitted that, at the time of his arrest in Oakland in March 2023, he had 317.7 grams (gross weight) of fentanyl on his person and in his car, and that he had a loaded, privately manufactured, semi-automatic handgun (a “ghost gun”) in his backpack.
At the time he committed the offenses for which he was sentenced yesterday, Moral-Raudales was on federal supervised release following a 2020 drug trafficking conviction that also resulted from his sale of drugs in the Tenderloin.
“Recidivist drug dealers who prey on the Tenderloin are a clear and present danger to our community, especially those who arm themselves with guns,” said United States Attorney Ismail J. Ramsey. “This Office will marshal all resources needed to ensure that repeat players in the Tenderloin drug market face justice.”
“Moral-Raudales was given the opportunity to change his life after his first federal drug trafficking conviction. Instead, he recklessly chose to endanger our community by selling poison in the Tenderloin while arming himself with a weapon,” said DEA Special Agent in Charge Brian M. Clark. “DEA will be relentless in our pursuit of those who repeatedly and brazenly violate the law.”
In addition to sentencing Moral-Raudales to prison, Judge Donato ordered the defendant to serve four years of supervised release to begin after his prison term is completed. The defendant was immediately remanded into custody.
Assistant U.S. Attorney George Hageman is prosecuting the case with the assistance of Erick Machado. The prosecution is the result of a months-long investigation by the DEA and the San Francisco Police Department.
One Pill Can Kill: Beware of pills bought on the street. Fentanyl, a Schedule II controlled substance, is a highly potent opiate that can be diluted with cutting agents to create counterfeit pills that purport to mimic the effects of Oxycodone, Percocet, and other drugs, but can be obtained at a lower cost. However, very small variations in the amount or quality of fentanyl create huge effects on the potency of the counterfeit pills and can easily cause death. Fentanyl has now become the leading cause of drug overdose deaths in the United States. Counterfeit, fentanyl-laced pills are usually shaped and colored to resemble pills that are sold legitimately at pharmacies.
San Jose Man Charged in Alleged Conspiracy to Steal High-End Bicycles in Bay Area for Resale in MexicoRead the Press Release
SAN JOSE – A federal grand jury has indicted Victoriano Romero, charging him with conspiracy and related charges in connection with an alleged scheme to steal high-end performance bicycles from residents in the Bay Area and transport the bicycles to Mexico for resale.
According to the indictment, filed January 23, 2024, and unsealed earlier today, Romero, 53, from San Jose, participated in a complex international fencing operation that involved stealing bicycles from homes in San Francisco and Redwood City, Calif., during nighttime burglaries, and then transporting the stolen bicycles to Jalisco, Mexico, for resale. The indictment alleges Romero owns an automotive shop in San Jose where he received the stolen bicycles, took pictures of them, disassembled them, packaged them for delivery, and then had them transported to a co-conspirator in Mexico. Romero allegedly sent the pictures to his co-conspirator who used the pictures for online advertisements to sell the bicycles. Further, the indictment alleges Romero received a share of the profits from the international bicycle fencing scheme.
The indictment contains a description of nine of the bicycles that were stolen between April 2020 and April 2021. The bicycles, ranging in value from $3,000 to $9,000, included notable manufacturers such as a Serotta Titanium bicycle, a Bulls Grinder Evo bicycle, and a Cervelo C3 Carbon bicycle.
The indictment also describes additional details about the participation of Romero’s alleged co-conspirator in the scheme. For example, the indictment alleges the unindicted co-conspirator posted pictures of the stolen bicycles on a Facebook sales page using a virtual private network (or similar method) so that only persons in Mexico could see that the bicycles were for sale. In addition, the indictment describes how the co-conspirator reassembled the bicycles in Mexico before selling them and maintained a ledger listing the profits from the sales of the bicycles.
In sum, Romero is charged with one count of conspiracy to transport stolen goods in foreign commerce, in violation of 18 U.S.C. §§ 371 and 2314, and two counts of transportation of stolen goods in foreign commerce, in violation of 18 U.S.C. §§ 2314 and 2.
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. The maximum statutory penalty for the conspiracy charge is five years in prison. The maximum statutory penalty for the substantive transportation charges is 10 years, per count. In addition, as part of any sentence, the court could order defendant to serve an additional term of supervised release to begin after a prison term, additional fines, and restitution, if appropriate. 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.
Romero made his initial federal court appearance to face the charges this morning before U.S. Magistrate Judge Peter H. Kang. He was released on bond. His next scheduled court appearance is scheduled for April 10, 2024, before P. Casey Pitts, United States District Judge, for status.
The announcement was made by U.S. Attorney Ismail J. Ramsey and Federal Bureau of Investigation Special Agent in Charge Robert K. Tripp.
Assistant U.S. Attorney Michael Lagrama is prosecuting the case. The prosecution of this case is the result of an investigation by the FBI and the San Francisco Police Department.
Attorney General Merrick B. Garland Honors Local Attorneys as Part of 2023 Attorney General’s AwardsRead the Press Release
SAN JOSE – Attorney General Merrick B. Garland announced the recipients of the 70th and 71st Attorney General’s Awards, honoring Justice Department employees and others for extraordinary contributions to the enforcement of our nation’s laws. Recipients from both 2022 and 2023 were selected from a group of more than 800 nominees. Four Assistant United States Attorneys serving in the Northern District of California were among the persons who received awards during the ceremony in Washington, D.C.
“Each of today’s recipients has served with distinction, and in so doing, they have enabled the Justice Department to advance its work on behalf of the American people,” said Attorney General Garland. “Their exceptional leadership, heroism, and dedication have benefited people and communities across the country.”
“I am extremely proud to see the hard work of this team recognized by Attorney General Garland,” said U.S. Attorney Ismail Ramsey. “The guilty verdicts and sentencings in the Theranos case could not have been achieved without the dedicated efforts of team members who spent many hours reviewing millions of pages of documents, organizing many skillful presentations, and delivering careful arguments in furtherance of justice for the people of the United States. The recognition is well-deserved.”
The awards presented include the John Marshall Award, named for the fourth Chief Justice of the United States. The award recognizes outstanding professional achievement by attorneys of the Justice Department. Recipients of the 2023 John Marshall Award for Trial of Litigation include Northern District of California Assistant U.S. Attorneys Robert S. Leach, Kelly I. Volkar, John C. Bostic, and Jeffrey D. Nedrow for their work in United States v. Holmes and United States v. Balwani. These prosecutions were also the product of outstanding work by former Assistant U.S. Attorney Jeff Schenk, the Federal Bureau of Investigation (in particular, Special Agent Mario Scussel and Special Agent Adelaida Hernandez), the U.S. Postal Inspections Service (in particular, Special Agent Christopher McCollow), and the U.S. Food and Drug Administration’s Office of Criminal Investigations (in particular, Special Agent in Charge George Scavdis), as well as the assistance of Madeline Wachs, Lakisha Holliman, Sara Slattery, Elise Etter, Susan Kreider, Lynette Dixon, Sahib Kaur, and Leeya Kekona. These criminal cases arose from fraud committed by defendants Elizabeth A. Holmes and Ramesh “Sunny” Balwani in connection with Theranos, Inc., a now-defunct blood testing company based in Palo Alto and Newark, Calif. Each defendant was convicted in a separate trial, after which Holmes was sentenced to 135 months (11 years, 3 months) in federal prison for defrauding investors in Theranos of hundreds of millions of dollars and Balwani was sentenced to 155 months (12 years, 11 months) in federal prison for fraud that risked patient health by misrepresenting the accuracy of Theranos blood analysis technology and that defrauded Theranos investors.
A list of all the recipients of the 70th and 71st Attorney General’s Awards can be found here.
Foreign National Charged for International Money Laundering Conspiracy and Role in Operation of Unlicensed Digital Currency Exchange BTC-eRead the Press Release
An indictment was unsealed on Tuesday charging a Belarusian and Cypriot national with money laundering conspiracy and operation of an unlicensed money services business.
According to the indictment, between 2011 and July 2017, Aliaksandr Klimenka, 42, allegedly controlled BTC-e, a digital currency exchange, with Alexander Vinnik and others. Klimenka also allegedly controlled Soft-FX, a technology services company, and FX Open, a financial company.
The indictment alleges BTC-e was a significant cybercrime and online money laundering entity that allowed its users to trade in bitcoin with high levels of anonymity and developed a customer base heavily reliant on criminal activity. BTC-e allegedly facilitated transactions for cybercriminals worldwide and received criminal proceeds from numerous computer intrusions and hacking incidents, ransomware scams, identity theft schemes, corrupt public officials, and narcotics distribution rings, and allegedly was used to facilitate crimes ranging from computer hacking to fraud, identity theft, tax refund fraud schemes, public corruption, and drug trafficking. BTC-e’s servers, maintained in the United States, were allegedly one of the primary ways in which BTC-e and its operators effectuated their scheme. Those servers were allegedly leased to and maintained by Klimenka and Soft-FX.
Despite doing substantial business in the United States, BTC-e allegedly was not registered as a money services business with the U.S. Department of Treasury, had no anti-money laundering process, no system for appropriate “know your customer” or “KYC” verification, and no anti-money laundering program as required by federal law.
Klimenka was arrested in Latvia on Dec. 21, 2023, at the request of the United States and made his initial appearance in San Francisco yesterday. He is currently being held in custody.
If convicted, Klimenka faces a maximum penalty of 25 years in prison.
Acting Assistant Attorney General Nicole M. Argentieri of the Justice Department’s Criminal Division, U.S. Attorney Ismail J. Ramsey for the Northern District of California, Special Agent in Charge William Mancino of the U.S. Secret Service (USSS) Criminal Investigative Division, Assistant Director Michael D. Nordwall of the FBI’s Criminal Investigative Division, Chief Jim Lee of IRS Criminal Investigation (IRS:CI), and Special Agent in Charge Tatum King of Homeland Security Investigations (HSI) San Francisco made the announcement.
The USSS; FBI; IRS:CI Oakland Field Office and Cyber Crime Unit in Washington, D.C.; and HSI are investigating the case.
Trial Attorney C. Alden Pelker of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Claudia Quiroz for the Northern District of California, both members of the National Cryptocurrency Enforcement Team (NCET), and Assistant U.S. Attorney Katherine Lloyd-Lovett for the Northern District of California are prosecuting the case.
The Justice Department’s Office of International Affairs worked with the Latvian government to secure the arrest of Klimenka.
The NCET was established to combat the growing illicit use of cryptocurrencies and digital assets. Within the Criminal Division’s Computer Crime and Intellectual Property Section, the NCET conducts and supports investigations into individuals and entities that are enabling the use of digital assets to commit and facilitate a variety of crimes, with a particular focus on virtual currency exchanges, mixing and tumbling services, and infrastructure providers. The NCET also works to set strategic priorities regarding digital asset technologies, identify areas for increased investigative and prosecutorial focus, and lead the department’s efforts to collaborate with domestic and foreign government agencies as well as the private sector to aggressively investigate and prosecute crimes involving cryptocurrency and digital assets.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Foreign National Charged for International Money Laundering Conspiracy and Role in Operation of Unlicensed Digital Currency Exchange BTC-eRead the Press Release
SAN FRANCISCO — An indictment was unsealed on Tuesday charging a Belarusian and Cypriot national with money laundering conspiracy and operation of an unlicensed money services business.
According to the indictment, between 2011 and July 2017, Aliaksandr Klimenka, 42, allegedly controlled BTC-e, a digital currency exchange, with Alexander Vinnik and others. Klimenka also allegedly controlled Soft-FX, a technology services company, and FX Open, a financial company.
The indictment alleges BTC-e was a significant cybercrime and online money laundering entity that allowed its users to trade in bitcoin with high levels of anonymity and developed a customer base heavily reliant on criminal activity. BTC-e allegedly facilitated transactions for cybercriminals worldwide and received criminal proceeds from numerous computer intrusions and hacking incidents, ransomware scams, identity theft schemes, corrupt public officials, and narcotics distribution rings, and allegedly was used to facilitate crimes ranging from computer hacking to fraud, identity theft, tax refund fraud schemes, public corruption, and drug trafficking. BTC-e’s servers, maintained in the United States, were allegedly one of the primary ways in which BTC-e and its operators effectuated their scheme. Those servers were allegedly leased to and maintained by Klimenka and Soft-FX.
Despite doing substantial business in the United States, BTC-e allegedly was not registered as a money services business with the U.S. Department of Treasury, had no anti-money laundering process, no system for appropriate “know your customer” or “KYC” verification, and no anti-money laundering program as required by federal law.
Klimenka was arrested in Latvia on Dec. 21, 2023, at the request of the United States and made his initial appearance in San Francisco yesterday. He is currently being held in custody.
If convicted, Klimenka faces a maximum penalty of 25 years in prison.
U.S. Attorney Ismail J. Ramsey for the Northern District of California, Acting Assistant Attorney General Nicole M. Argentieri of the Justice Department’s Criminal Division, Special Agent in Charge William Mancino of the U.S. Secret Service (USSS) Criminal Investigative Division, Assistant Director Michael D. Nordwall of the FBI’s Criminal Investigative Division, Chief Jim Lee of IRS Criminal Investigation (IRS:CI), and Special Agent in Charge Tatum King of Homeland Security Investigations (HSI) San Francisco made the announcement.
The USSS; FBI; IRS:CI Oakland Field Office and Cyber Crime Unit in Washington, D.C.; and HSI are investigating the case.
Trial Attorney C. Alden Pelker of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Claudia Quiroz for the Northern District of California, both members of the National Cryptocurrency Enforcement Team (NCET), and Assistant U.S. Attorney Katherine Lloyd-Lovett for the Northern District of California are prosecuting the case.
The Justice Department’s Office of International Affairs worked with the Latvian government to secure the arrest of Klimenka.
The NCET was established to combat the growing illicit use of cryptocurrencies and digital assets. Within the Criminal Division’s Computer Crime and Intellectual Property Section, the NCET conducts and supports investigations into individuals and entities that are enabling the use of digital assets to commit and facilitate a variety of crimes, with a particular focus on virtual currency exchanges, mixing and tumbling services, and infrastructure providers. The NCET also works to set strategic priorities regarding digital asset technologies, identify areas for increased investigative and prosecutorial focus, and lead the department’s efforts to collaborate with domestic and foreign government agencies as well as the private sector to aggressively investigate and prosecute crimes involving cryptocurrency and digital assets.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Monterey Caterer Charged with Defrauding the Government Out of $4 Million in Covid-Relief FundsRead the Press Release
SAN JOSE – A federal grand jury returned an indictment yesterday charging Dory Lindsay Ford with charges related to COVID fraud, including bank fraud, wire fraud, and money laundering, announced United States Attorney Ismail J. Ramsey; IRS Criminal Investigation (CI) Acting Special Agent in Charge Michael Mosley of the Oakland Field Office; and Small Business Administration, Office of Inspector General (SBA-OIG) Special Agent in Charge Weston King.
According to the indictment, Ford, 57, of Monterey, California, operated a catering company called Aqua Terra Culinary, Inc. (Aqua Terra). During the pandemic, Ford applied for and received approximately $4 million in loans and grants from the Paycheck Protection Program (PPP), the Restaurant Revitalization Fund (RRF), and the Economic Injury Disaster Loan Program (EIDL).
The Coronavirus Aid, Relief, and Economic Security (“CARES”) Act was a federal law enacted in or around March 2020 and designed to provide emergency financial assistance to the millions of Americans suffering the economic effects of the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses, through the PPP.
Section 5003 of American Rescue Plan Act of 2021 (ARPA) established the RRF and appropriated $28.6 billion to the SBA for the purpose of making grants under the RRF. The SBA awarded funding through the RRF to restaurants, bars, and similar businesses serving food and drink. The purpose of this funding was to provide support to eligible entities that suffered revenue losses as a result of the COVID-19 pandemic and related mitigation measures.
The Economic Injury Disaster Loan (“EIDL”) program is an SBA program that provided low-interest financing to small businesses, renters, and homeowners in regions affected by declared disasters.
According to the indictment, Ford obtained approximately $4 million in PPP, RRF, and EIDL funds by using false and fraudulent, representations, promises, and omissions and concealed material facts. The indictment alleges that Ford used the COVID-19 loan and grant money to purchase real estate properties in the country of Belize, to invest in the stock market, and to fund a different business venture instead of using the loan money for proper expenses, such as payroll costs, rent or mortgage payments, and supplies.
The indictment charges Ford with bank fraud, in violation of 18 U.S.C. § 1344, as well as three counts of wire fraud in violation of 18 U.S.C. § 1343, and two counts of money laundering in violation of 18 U.S.C. § 1957.
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Ford faces a maximum statutory sentence of 30 years in prison and a maximum statutory fine of $1 million for bank fraud; a maximum statutory sentence of 20 years in prison and a maximum statutory fine of $250,000 for each count of wire fraud; and a maximum statutory sentence of 10 years in prison and a maximum statutory fine of $250,000 for both counts of money laundering. 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.
Ford’s next court appearance is scheduled for January 31, 2024, before the Honorable Virginia K. DeMarchi, United States Magistrate Judge for the Northern District of California.
Assistant United State Attorney Neal C. Hong is prosecuting the case. The prosecution is a result of an investigation by CI and SBA-OIG.
San Jose Resident Sentenced to Five Years’ Imprisonment for Possession of Child PornographyRead the Press Release
SAN JOSE – Brian Risso was sentenced today to 60 months in prison for possession of child pornography, announced United States Attorney Ismail J. Ramsey and Federal Bureau of Investigation Special Agent in Charge Robert K. Tripp. The sentence was handed down by the Honorable Beth L. Freeman, U.S. District Judge.
Risso, 63, of San Jose, pleaded guilty to the charge on June 8, 2023. According to his plea agreement, Risso admitted that in February 2022, he knowingly possessed visual depictions of minors engaged in sexually explicit conduct, in violation of 18 U.S.C. § 2252(a)(4)(B). At sentencing, the Court found that these depictions included prepubescent minors and minors engaged in sadistic or masochistic conduct. According to a court filing, Risso possessed 542 files containing child pornography, including 513 images and 29 videos.
In addition to the prison term, Judge Freeman ordered Risso to serve 60 months of supervised release, to begin after his prison term and to pay a fine of $25,000; and to pay a $5,100 special assessment. Judge Freeman scheduled a hearing to decide issues regarding restitution for April 9, 2024.
Assistant United States Attorney Neal C. Hong is prosecuting the case. This case is a result of an investigation by the Federal Bureau of Investigation.
Dark Web Vendor Sentenced to Eighteen Months in Prison for Distributing Methamphetamine-Pressed Adderall PillsRead the Press Release
SAN FRANCISCO – Tony Tan was sentenced to serve 18 months in prison for possession with intent to distribute methamphetamine in connection with his sale of counterfeit Adderall pills pressed with methamphetamine on the dark web, announced United States Attorney Ismail J. Ramsey; Drug Enforcement Administration (DEA), San Francisco Field Division, Special Agent in Charge Brian M. Clark; San Francisco Division Postal Inspector in Charge Rafael Nuñez; and IRS Criminal Investigation (IRS-CI) Oakland Field Office Acting Special Agent in Charge Michael Mosley. The sentence was handed down by the Hon. Richard Seeborg, Chief United States District Judge.
Tan, 28, of San Francisco, pleaded guilty to the charge in May 2023. According to his plea agreement, Tan admitted that he operated a dark web vendor site, Adderall123, through which he sold counterfeit Adderall pills that were laced with methamphetamine. Tan admitted the counterfeit Adderall pills were created and stamped in such a way as to mirror legitimate Adderall pills; specifically, they were orange, circular, and pressed with the letters “dp” and the number “30.” Tan sold the drugs to buyers located throughout the United States. Over the years, Tan operated Adderall123 on numerous dark web marketplaces, including Empire, ASAP, White House Market and Torrez. During this time, Tan executed thousands of sales of the counterfeit Adderall pills in various quantities.
Tan’s plea agreement contains additional details of his drug distribution operation. For example, the plea agreement describes how Tan distributed the counterfeit Adderall pills using the United States Postal Service by mailing the drugs in smell-proof bags contained within Priority Mail Flat Rate Envelopes. In addition, the plea agreement describes how Tan recruited others to assist with packaging and mailing the drugs. Further, Tan wrote fake sender names and addresses on the packages and paid postage in cash, all in hopes of thwarting law enforcement efforts to find the sender of the illicit packages. Also, Tan accepted payment for the counterfeit pills in cryptocurrency, which has privacy features that help users anonymize their transaction activity.
On November 12, 2021, federal agents seized two packages mailed by Tan that contained over 640 methamphetamine-pressed Adderall pills—approximately 11.35 grams of actual methamphetamine. On March 29, 2023, Tan was charged by Information with one count of possession with intent to distribute 5 grams and more of methamphetamine, in violation of 21 U.S.C. §§ 841(a)(1) and (b)(1)(B)(viii). He pleaded guilty to the charge.
In addition to the prison term, Judge Seeborg ordered Tan to forfeit $17,744 in U.S. currency as well as the cryptocurrency (Ethereum, Bitcoin, and Litecoin) seized from his accounts. Judge Seeborg also ordered Tan to serve three years of supervised release, to begin after his prison term. Judge Seeborg ordered Tan to self-surrender on April 2, 2024, to begin serving his prison term.
Assistant U.S. Attorney Kristina Green is prosecuting the case, with assistance from Pat Mahoney. The prosecution is the result of an investigation by the DEA, CI, and USPIS.
San Carlos Resident Charged with Investment Fraud SchemeRead the Press Release
SAN FRANCISCO – David Scott Cacchione was arrested and has been charged by criminal complaint with conspiring to commit wire fraud in connection with an investment fraud scheme, announced United States Attorney Ismail J. Ramsey, Federal Bureau of Investigation Special Agent in Charge Robert K. Tripp, and IRS Criminal Investigation (CI) Oakland Field Office Acting Special Agent in Charge Michael Mosley.
According to the complaint, Cacchione, 59, of San Carlos, worked with another person to solicit investors in what they called an “Accounts Receivable Factoring Program.” The complaint alleges Cacchione and an unnamed co-conspirator told victims that investment funds would be used to purchase investment grade accounts receivable, and that investors would be repaid once the receivables were paid. According to the complaint, investors were promised as much as 2 percent per month in interest on the investment and were told that Cacchione himself was a large investor in the program.
The complaint alleges these representations were false and the investment funds were not used to purchase accounts receivables. From at least November 2021 through September 2022, at least four victims were cheated out of a total of about $1.1 million, according to the allegations. The complaint also states that, instead of investing the money as promised, Cacchione and his co-conspirator spent the money on personal and living expenses. The criminal complaint charges Cacchione with conspiracy to commit wire fraud, in violation of 18 U.S.C. § 1349 and 18 U.S.C. § 1343.
Cacchione was arrested on January 16, 2024, and made his initial appearance in federal court in San Francisco on January 17, 2024. Cacchione remains in custody pending further proceedings in the case. Cacchione’s next scheduled appearance is at 9:30 a.m. on January 19, 2024, for a detention hearing before U.S. Magistrate Court Judge Lisa J. Cisneros.
A criminal complaint merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, the defendant faces a maximum sentence of twenty years in prison and a fine of $250,000, plus restitution if appropriate, for a violation of 18 U.S.C. § 1349. 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 Garth Hire is prosecuting the case with the assistance of Aarian Beiti. The prosecution is the result of an investigation by CI and the FBI.
complaint_filed-signed-copycacchione.pdfHonduran Drug Dealer Indicted and Detained Pending Trial for Possessing More Than A Kilogram of Fentanyl on Multiple Dates in 2023Read the Press Release
SAN FRANCISCO — A federal magistrate judge has ordered that Defendant Milton Joel Varela Arteaga—a Honduran national who resides in Oakland, California, and was recently indicted by a federal grand jury for possessing large quantities of fentanyl on three separate occasions in 2023—be detained pending trial on fentanyl trafficking charges, announced United States Attorney Ismail J. Ramsey; Homeland Security Investigations (HSI) Special Agent in Charge Tatum King; and Drug Enforcement Administration (DEA), San Francisco Field Division, Special Agent in Charge Brian M. Clark.
Arteaga, 27, was originally charged via a criminal complaint in November 2023. Among other things, the complaint alleges that:
• On May 11, 2023, law enforcement officers searched Arteaga’s Oakland residence and seized more than 1.3 kilograms of fentanyl and more than $70,000 in cash. In a post-arrest interview, Arteaga told officers that he regularly sold drugs in the Tenderloin neighborhood of San Francisco;
• On June 28, 2023, law enforcement officers stopped Arteaga in a car as it left the Oakland Airport and seized more than two kilograms of fentanyl and more than $12,000 in cash; and
• On November 29, 2023, federal and state law enforcement officers searched Arteaga’s Oakland residence and found more than half a kilogram of fentanyl in a black Mercedes that belonged to Arteaga and his partner and over $13,000 in cash in their bedroom.
All of the fentanyl seizures described in the complaint occurred while Arteaga was on pretrial release for state narcotics charges filed against him in 2022. Arteaga has been in federal custody since his arrest in late November 2023, and he was ultimately indicted by a federal grand jury on December 13, 2023, on three counts of possession with intent to distribute fentanyl, in violation of 21 U.S.C. § 841(a)(1) and (b)(1)(B)(vi). A second defendant was indicted at the same time on similar charges.
“Tackling the scourge of fentanyl is a top priority for my Office,” said U.S. Attorney Ramsey. “Our efforts to disrupt the fentanyl trade take many forms, from prosecuting the dealers who peddle this poison on the streets of the Tenderloin to identifying, arresting, and charging their suppliers. We and our law enforcement partners will hold accountable those who sell or facilitate the sale of this deadly drug at every level.”
“The indictment and subsequent detainment of Mr. Arteaga underscore HSI’s commitment to work with law enforcement agencies to stop the scourge of fentanyl trafficking from further ravaging the Bay Area,” said HSI Special Agent in Charge King. “HSI appreciates the joint investigative work with the DEA, Alameda County Narcotics Task Force, the U.S. Attorney’s Office, and the DOJ OCDETF Program, which resulted in this action. As Mr. Arteaga’s case demonstrates, we will not rest while fentanyl poisons our communities and will pursue its purveyors at every turn to disrupt and ultimately dismantle their operations.”
“Fentanyl is now the leading cause of death for Americans between the ages of 18 to 45 and is the greatest drug threat facing our nation,” said DEA Special Agent in Charge Clark. “DEA’s relentless enforcement efforts in the Tenderloin will continue in pursuit of those who distribute this deadly drug in our community.”
Arteaga was ordered detained by United States Magistrate Judge Peter H. Kang on January 12, 2024. His next scheduled appearance is a status conference before Senior United States District Judge Charles R. Breyer on January 31, 2024.
An indictment and a complaint merely allege that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Arteaga faces a minimum prison sentence of five years and a maximum prison sentence of 40 years on each of the three counts on which he is indicted. 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.
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. Attorneys Daniel Pastor and Kevin Yeh are prosecuting this case with assistance from Paralegal Specialist Tina Rosenbaum. The prosecution is the result of a federal and state partnership between HSI, DEA, and the Alameda County Narcotics Task Force (ACNTF) to target the distribution of the deadly opioid fentanyl.
Former San Francisco Resident Sentenced to Four Years in Prison for Crimes Related to “Ichioka Ventures” Cryptocurrency Fraud SchemeRead the Press Release
SAN FRANCISCO – William Koo Ichioka was sentenced to serve four years in prison and ordered to pay a $5 million fine for committing multiple felonies in connection with an investment fraud scheme involving cryptocurrencies and other investment vehicles. The sentence was handed down by the Hon. Vince Chhabria, United States District Judge.
Ichioka, 30, formerly of San Francisco and New York, pleaded guilty to five charges—wire fraud, two counts of aiding and assisting in the preparation of a false or fraudulent tax return, committing fraud in connection with the purchase and sale of securities, and engaging in commodities fraud—on July 12, 2023. According to his plea agreement, beginning in 2018, Ichioka operated a scheme in which he fraudulently raised tens of millions of dollars from over 100 persons and entities. Court documents describe how Ichioka held himself out as “self-made investor” with a “multimillion fortune” as he solicited investors by promising that their funds would be invested in various securities and/or commodities, including cryptocurrency, and cryptocurrency arbitrage, futures, and derivatives, and foreign exchange currency transactions. Ichioka began doing business under the name “Ichioka Ventures” in 2019 and represented to prospective investors that they would earn 10% returns every 30 business days, and that his investment and trading activities actually had been generating or had the ability to generate returns in excess of these amounts. Further, Ichioka created a website for Ichioka Ventures that allowed investors to create and login to accounts to invest, view balances and investments, and view transaction history.
Ichioka admitted that, rather than invest his victims’ money as he promised, he instead commingled investor money with his own funds and used investor money to make purchases of luxury items (including luxury vehicles, watches, and other jewelry) and to fund his own personal expenses. Such personal expenses included his personal residence, restaurants and bars, grocery stores, taxi and car share rides, retail stores, gym membership fees, and online purchases. Moreover, Ichioka admitted that he and Ichioka Ventures did not actually earn 10% returns every 30 business days for his investors throughout the time that he represented that it did. Rather, he and Ichioka Ventures sustained losses from portions of funds that he did invest. Court documents describe that by the end of 2019—unbeknownst to investors—Ichioka had privately acknowledged that the “[c]ompany hasn’t made any money since we started.”
“Ichioka lured his victims by falsely promising they would receive huge returns quickly on their investments,” said First Assistant United States Attorney Patrick Robbins. “During the years that he ran his cryptocurrency-based Ponzi scheme, Ichioka managed to defraud more than 100 investors of tens of millions of dollars. Today’s sentence illustrates that lengthy prison terms await all those who seek to swindle investors in this district.”
“Ichioka convinced unsuspecting investors to pour money into his bogus venture with false promises of legitimate profits. His deceitful financial scheme victimized more than 100 people, including his friends and family. I hope that today's sentence brings them some measure of justice,” said FBI Special Agent in Charge Robert Tripp. “The FBI and our law enforcement partners will continue to pursue criminals who choose to commit financial fraud and hold them accountable for their crimes.”
“Predatory financial schemes like Ichioka’s are not victimless, nor do they escape justice as evidenced by today’s sentencing,” said IRS Criminal Investigation Acting Special Agent in Charge Michael Mosley of the Oakland Field Office. “IRS CI Oakland Field Office Special Agents and investigative staff in conjunction with our federal law enforcement partners follow the money, and as a result, deliver cases that lead to just outcomes.”
Ichioka admitted that he repaid existing investors with new investor funds to further perpetuate the fraud. Further, Ichioka agreed that he owes non-family investors in “Ichioka Ventures” at least $21 million as a result of the scheme, and additionally owes his family members over $40 million.
Ichioka also admitted that he concealed and hid the scheme by doctoring financial documents to falsely overstate the value of assets (including bank, brokerage, and cryptocurrency exchange materials) and providing doctored documents to prospective investors, according to court filings describing Ichioka’s agreement to plead guilty. Ichioka also presented false statements of account to investors via the Ichioka Ventures website, failed to provide tax documentation to investors, and willfully failed to report income to the Internal Revenue Service in this scheme.
On June 22, 2023, Ichioka was charged in an Information with one count of wire fraud, in violation of 18 U.S.C. § 1343; two counts of aiding or assisting in the preparation of a false or fraudulent tax return, in violation of 26 U.S.C. § 7206(2); one count of securities fraud, in violation of 15 U.S.C. §§ 78j(b), 78ff; 17 C.F.R. § 240.10b-5; and one count of commodities fraud, in violation of 18 U.S.C. § 1348. Ichioka pleaded guilty to all five counts.
In addition to the prison term and fine, Judge Chhabria also ordered Ichioka to serve five years of supervised release to begin after his prison term. A hearing is scheduled for February 20, 2024, before Judge Chhabria to determine issues related to restitution.
The case is being prosecuted by Assistant United States Attorneys Eric Cheng and Benjamin Kingsley with assistance from Megan Pagaduan. The prosecution is the result of an investigation by the FBI and IRS-Criminal Investigation. The U.S. Attorney’s Office and the federal law enforcement agencies also thank the San Francisco Regional Office of the Securities and Exchange Commission and the Commodity Futures Trading Commission, both of whom conducted separate parallel investigations into the defendant’s conduct.
Leader of San Francisco MS-13 Clique Sentenced to Life in Prison Following Convictions for Murder and Attempted Murder in Aid of Racketeering and Racketeering ConspiracyRead the Press Release
SAN FRANCISCO -- The leader of the San Francisco 20th Street clique of the MS-13 street gang was sentenced to life in prison after being convicted of racketeering conspiracy, two counts of murder in aid of racketeering, one count of attempted murder in aid of racketeering, and one count of brandishing a firearm in furtherance of a crime of violence, announced First Assistant United States Attorney Patrick Robbins and Homeland Security Investigations (HSI) Special Agent in Charge Tatum King. There is no parole in the federal system.
Elmer Rodriguez, a/k/a “Gordo,” of San Francisco, California, was convicted on June 1, 2023, following a three-week jury trial. The Honorable Richard Seeborg, Chief U.S. District Judge, handed down today’s sentence.
“For years, the defendant led a violent street gang that committed several murders and attempted murders in the Bay Area, particularly in the Mission District of San Francisco,” said First Assistant United States Attorney Patrick Robbins. “San Francisco residents deserve to feel safe in their own communities. Today’s sentence sends a clear message that anyone who commits acts of violence and endangers public safety in the Northern District of California will face federal prosecution and a severe federal prison sentence as a consequence of their conduct.”
“This sentence today sends a loud and clear message that HSI, with law enforcement agencies in the region, will continue to work around the clock, always prioritizing the safety of our communities. It represents another important stride in our ongoing effort to combat crime in the Bay Area,” said San Francisco HSI Special Agent in Charge Tatum King. “Working with the San Francisco Police Department (SFPD) and the U.S. Attorney’s Office, Northern District of California, we’ve successfully brought to justice this dangerous gang leader who played a key role in ruthlessly murdering multiple victims. Of note, collective efforts in this overarching case began in July 2017, which underlies the complexities of investigations into transnational criminal organizations like MS-13, as well as the commitment of the agencies involved. HSI is deeply appreciative of the work of its agents and analysts, as well as SFPD and the U.S. Attorney’s Office.”
At trial, the government presented evidence that Rodriguez ordered the murder of Jorge Martinez near 19th and Mission Streets on March 17, 2017. Martinez had been celebrating his birthday after attending a Golden State Warriors game with his son. After the game, they went to a bar in the Mission District. Rodriguez and other MS-13 clique members were also present at the bar that night and identified Martinez as a possible rival Norteño gang member. Rodriguez ordered another clique associate to murder Martinez. The associate followed Martinez out of the bar and shot him to death.
Evidence at trial also showed that Rodriguez ordered the murder of Giovanni Alvarez, a/k/a “P Wee,” on May 25, 2017. Alvarez was a 20th Street clique member whom Rodriguez and others in the clique believed to be cooperating with law enforcement. Rodriguez sanctioned Alvarez’s murder because of these suspicions. Rodriguez and his associates, including Edwin Alvarado Amaya, a/k/a “Muerte,” and Kenneth Campos, a/k/a “Nesio,” lured Alvarez into a car. Campos drove the group to Bernal Heights Park. At the park, Rodriguez gave a signal to Alvarado Amaya, who then hacked Alvarez to death by inflicting dozens of deep wounds to his face and torso with a machete. Alvarado Amaya and Campos have pled guilty and been sentenced for their roles in this murder.
Rodriguez was also sentenced for his role in an attempted murder and use of a firearm in furtherance of a crime of violence stemming from a shotgun shooting that followed an extortion attempt by Rodriguez and other MS-13 associates on Eddy Street in the Tenderloin District on November 26, 2017.
Rodriguez’s trial also featured evidence of Rodriguez’s involvement in additional acts of violence including:
• Ordering that other members of the clique go on a “hunt” to shoot suspected Norteños, which culminated with the September 16, 2016 shooting of a suspected Norteño at 21st Street and Hampshire Street;
• Attending an October 27, 2016 gang assault in the Mission District;
• Instigating a May 17, 2017 gang assault outside of a taqueria in the Mission District;
• Serving as the driver in a November 30, 2017 attempted murder at 24th Street and Potrero Avenue in the Mission District during which members of the 20th Street clique repeatedly stabbed a victim whom they incorrectly identified as a Norteño.In total, 17 defendants have been convicted as a part of this investigation, which has resulted in convictions relating to four murders, four attempted murders, and multiple assaults with dangerous weapons.
This case is being prosecuted by the Organized Crime Strike Force of the Office of the United States Attorney. The prosecution is the result of investigations by HSI, SFPD Homicide Unit and Community Violence Reduction Team, San Mateo County Sheriff’s Office Gang Intelligence Unit and Investigations Bureau, Daly City Police Department, Pinole Police Department, Redwood City Police Department Street Crimes Reduction Team, and San Pablo Police Department.
Two East Bay Insurance Executives and Investment Advisor Charged with Fraud Tied to Insurance Company CollapseRead the Press Release
OAKLAND – A federal grand jury indictment was unsealed charging Jasbir S. Thandi, Sandeep Sahota, and Jaspreet Padda with insurance fraud crimes related to the collapse of Global Hawk Risk Retention Group, an insurance company headquartered in Livermore, California, announced United States Attorney Ismail J. Ramsey, FBI Special Agent in Charge Robert K. Tripp, and San Francisco Division Postal Inspector in Charge Rafael Nuñez.
According to the indictment, Thandi 67, of El Sobrante, was the president and treasurer of Global Hawk, The indictment alleges that between 2017 and 2019, Thandi, misappropriated over $19 million in Global Hawk funds, including sending over $1 million to an entity domiciled in the British Virgin Islands, and over $7 million to other outside entities controlled by Thandi.
The indictment further alleges that Thandi, Sahota, 47, resident of Concord, and Padda, 40, of Elk Grove, submitted false and fraudulent financial statements to insurance regulators that overstated Global Hawk’s assets by tens of millions of dollars and concealed the misappropriations. Sahota was Global hawk’s vice president and secretary and Padda was the company’s outside investment advisor. Global Hawk’s primary business was providing automobile liability insurance coverage for truck drivers and small trucking companies. In May 2020, after regulators discovered the misappropriation and Global Hawk’s insolvency, Global Hawk was declared insolvent and was liquidated pursuant to a court order.
The indictment charges Thandi, Sahota, and Padda with conspiracy to commit insurance fraud, in violation of 18 U.S.C. § 371 as well as two counts of insurance fraud (false statements to regulators), in violation of 18 U.S.C. §§ 1033(a) and 2. The indictment also charges Thandi with two counts of insurance fraud (misappropriation) in violation of 18 U.S.C. § 1033(b).
The indictment also charges Thandi with two counts of bank fraud, in violation of 18 U.S.C. § 1344. The indictment alleges that in 2016, Thandi obtained a $6.4 million bank loan based on false representations, and in 2017, obtained another $14.75 million bank loan, also based on false representations.
The conspiracy count has a maximum statutory sentence of five years in prison and a fine of $250,000. Each insurance fraud count has a maximum statutory sentence of 10 years in prison (or 15 years if the fraud jeopardized the safety and soundness of an insurer and was a significant cause of such insurer being placed in conservation, rehabilitation, or liquidation by an appropriate court) and a maximum fine of $250,000. Each bank fraud count has a maximum statutory sentence of 30 years in prison and a maximum fine of $1,000,000.
For all counts, the court also may order a term of supervised release, fines or other assessments, restitution, and forfeiture, 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.
Sahota was arrested yesterday morning and made an initial appearance before the Hon. Alex G. Tse, U.S. Magistrate Judge for the Northern District of California. Padda was arrested in the Eastern District of California.
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Assistant United States Attorneys David Ward and Abraham Fine are prosecuting the case with assistance from Kay Konopaske, Kathleen Turner, and Kevin Costello. The prosecution is a result of an investigation by the FBI and the United States Postal Inspection Service.
Individuals who believe that they may be a victim in this case should contact the United States Attorney’s Office for the Northern District of California’s victim specialists by email at: [email protected].
Indictment Charges San Jose Man with Robbing U.S. Mail CarrierRead the Press Release
SAN JOSE – A federal grand jury has indicted James Luna, charging him with the robbery of a mail carrier in the Sunnyvale, Calif., area, announced U.S. Attorney Ismail J. Ramsey and U.S. Postal Inspector in Charge Rafael Nuñez. The indictment follows the announcement by U.S. Attorney Ramsey and Postal Inspector in Charge Nuñez regarding multiple arrests made throughout the Bay Area in cases involving the interference with delivery of the U.S. mail.
According to papers filed in connection with the Luna case, on December 30, 2022, a person fitting Luna’s description approached a United States Postal Service mail carrier just before 4:00 p.m. and demanded that the mail carrier hand over her postal keys. The mail carrier reported that she could see the handle of a firearm sticking out of the robber’s pocket. The mail carrier handed over the keys and the robber absconded with them. The robber was later identified as James Luna, 32, of San Jose. The keys are used to open United States Postal Service mailboxes in a designated area.
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. Luna is charged with robbery of a mail carrier, in violation of 18 U.S.C. § 2114. The maximum statutory penalty for robbery of a mail carrier is 10 years in prison. Further, in addition to the prison term, the court may order defendant to serve an additional term of supervised release to begin after a prison term, additional fines, and restitution, if appropriate. 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.
On October 10, 2023, U.S. Attorney Ramsey and Postal Inspector in Charge Nuñez held a press conference at which they discussed a recent increase in the theft of postal keys, break-ins of postal vehicles, assaults on letter carriers, and various other criminal acts involving interference with delivery of the mail. According to U.S. Attorney Ramsey, a surge in arrests throughout the Bay Area has resulted in several defendants now facing severe federal penalties. A press release discussing the press conference can be found here.
Assistant U.S. Attorney Neal Hong is prosecuting the Luna case. The prosecution of this case is the result of an investigation by the United States Postal Inspection Service and Sunnyvale Police Department.
Former Linkedin Employee Pleads Guilty to Conspiracy to Commit Mail FraudRead the Press Release
SAN FRANCISCO – Kent Laird pleaded guilty in federal court today to two counts of conspiracy to commit mail fraud, announced United States Attorney Ismail J. Ramsey and FBI Special Agent in Charge Robert K. Tripp. The plea was accepted by the Honorable Jaqueline S. Corley, U.S. District Judge.
In pleading guilty, Laird, 50, of Bothell, Washington, admitted that as the Head of Content, Video & Studios for LinkedIn Media Productions (otherwise known as LMP) he became involved in two separate conspiracies and mail fraud schemes involving two independent contractors. Specifically, in June and then in October of 2018, Laird recommended that two independent contractors be hired by LinkedIn to assist him with producing various podcast projects despite knowing that neither person had any professional experience as a podcast producer. Over the course of the next eighteen months, Laird approved a total of 129 false invoices that the independent contractors submitted to LinkedIn. Laird submitted these invoices knowing that the two independent contractors had performed little to no podcast writing and producing work on behalf of LinkedIn. As a result of receiving these false invoices, LinkedIn paid a combined total of $689,210 to the two independent contractors. During the course of the conspiracy, Laird received kickbacks in the amount of $184,050 from the falsely obtained proceeds.
A federal grand jury indicted Laird on February 21, 2023, charging him with two counts of conspiracy to commit mail fraud, in violation of 18 U.S.C. § 1349, and eighteen counts of mail fraud, in violation of 18 U.S.C. § 1341. Under the plea agreement, Laird pleaded guilty to the two conspiracy counts. If he complies with the plea agreement, the remaining counts will be dismissed at sentencing.
Laird faces a maximum sentence of 20 years in prison, a fine of $250,000, plus restitution, if appropriate, for each violation of 18 U.S.C. § 1349. 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.
Judge Corley scheduled Laird’s sentencing hearing for March 27, 2024.
Assistant U.S. Attorney Barbara J. Valliere is prosecuting the case with the assistance of Kathy Tat. The prosecution is the result of an investigation by the Federal Bureau of Investigation.
Oakland Resident Pleads Guilty to Attempting to Illegally Export Firearms and Night Vision Rifle Scopes to the Sultanate of OmanRead the Press Release
SAN FRANCISCO – Oakland resident Fares Abdo Al Eyani, 40, pleaded guilty in federal court in San Francisco to one count of conspiring to export defense articles and seven counts of attempting to export defense articles, announced United States Attorney Ismail J. Ramsey, Assistant Attorney General for the Department of Justice National Security Division Matthew G. Olsen, Federal Bureau of Investigation Special Agent in Charge Robert K. Tripp, and Homeland Security Investigations Special Agent in Charge Tatum King. The plea was accepted by the Hon. Charles R. Breyer, U.S. District Judge.
According to the plea agreement, Al Eyani admitted he acquired no less than four firearms, with magazines and ammunition, and at least 44 rifle scopes, monoculars, and goggles with night vision capabilities in 2019. In November 2019, Al Eyani attempted to send the firearms to the Sultanate of Oman in shipping containers departing from the Port of Oakland. He concealed the firearms by disassembling them, wrapping them in aluminum foil, and then secreting them within automobiles inside the shipping container. Then, in December 2019, Al Eyani attempted to export the 44 rifle scopes, monoculars, and goggles to the Sultanate of Oman in two shipping containers departing from the Port of Oakland. Law enforcement searched the containers and seized the firearms, the magazines, and the ammunition, as well as the 44 rifle scopes, monoculars, and goggles with night vision capabilities. These actions thwarted Al Eyani’s unlawful scheme.
The commercial export of arms, ammunitions, implements of war and defense articles and services from the United States is governed by the Arms Export Control Act (“AECA”), 22 U.S.C. § 2778, and its attendant regulations, the International Trafficking in Arms Regulations (“ITAR”), 22 C.F.R. §§ 120-130. The AECA authorizes the President, among other things, to control the export of “defense articles” deemed critical to the national security and foreign policy interests of the United States. The AECA also authorizes the President to designate goods as “defense articles,” require licenses for the export of such articles, and promulgate regulations for the export of such articles. By executive order, the President has delegated this authority to the United States Department of State, Bureau of Political-Military Affairs, Directorate of Defense Trade Controls (“DDTC”). Accordingly, the DDTC has promulgated regulations under the AECA, known as the ITAR. The ITAR defines a “defense article” as any item on the United States Munitions List (“USML”). Persons desiring to export items on the USML from the United States to a place overseas must first register with the DDTC and obtain individual export licenses prior to any shipment abroad.
The plea agreement lays out that the four firearms, the magazines, and the ammunition, as well as at least seven of the night-vision rifle scopes, were defense articles prohibited from export without a license by the AECA and the ITAR. Al Eyani did not have a license to export the defense articles.
In a separate plea agreement, Al Eyani’s wife, Saba Mohsen Dhaifallah, 41, also pleaded guilty to making false statements to Federal Bureau of Investigation special agents during the investigation of this matter, in violation of 18 U.S.C. § 1001. Her plea also was accepted by Judge Breyer.
Judge Breyer scheduled Al Eyani’s and Dhailfallah’s sentencing hearings for March 22, 2024, at 9:30 am. Al Eyani faces a maximum sentence of twenty years’ imprisonment and a fine of $1,000,000. Dhaifallah faces a maximum sentence of five years’ imprisonment and a fine of $250,000. In addition, the court may order each defendant to serve an additional period of supervised release, if appropriate. However, any sentence 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 National Security and Cybercrime Section of the United States Attorney’s Office for the Northern District of California is prosecuting the case in consultation with the Counterintelligence and Export Control Section of the National Security Division of the Department of Justice. The prosecution is the result of an investigation by the Federal Bureau of Investigation, Homeland Security Investigations, and United States Customs and Border Protection.
California CEO Pleads Guilty to Employment Tax CrimesRead the Press Release
OAKLAND – A South Lake Tahoe man pleaded guilty to willfully failing to pay employment tax withholdings due to the IRS, announced U.S. Attorney Ismail J. Ramsey, Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division, and Internal Revenue Service Criminal Investigation (IRS-CI), Oakland Field Office, Acting Special Agent in Charge Mark Silva.
According to court documents and statements made in court, in 2016 and 2017, Robert Hienekamp, 58, was the Chief Executive Officer of Endowance Solutions, Inc., a software consulting and development company. During each of those years, Endowance Solutions withheld income, Social Security, and Medicare taxes from its employees’ wages. Hienekamp, however, did not file the legally required quarterly employment tax returns or pay the withholdings due to the IRS, despite knowing of his obligation to do so. In total, Hienekamp caused a tax loss of over $800,000.
Hienekamp is scheduled to be sentenced on June 27, 2024, 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.
IRS-CI, Oakland Field Office, is investigating the case.
Trial Attorney Mahana Weidler of the Tax Division and Assistant U.S. Attorney Michael Lagrama of the Northern District of California are prosecuting the case.
Canadian/Lebanese Citizen Charged with Mail and Wire Fraud and Money Laundering Conspiracies Makes Appearance in Federal CourtRead the Press Release
SAN FRANCISCO – Nemr Hallak, a citizen of Canada and Lebanon charged with operating a telemarketing fraud and money laundering conspiracy, was extradited from Greece to the United States to face charges in the Northern District of California, announced United States Attorney Ismail J. Ramsey, U.S. Postal Inspector in Charge Rafael Nunez, and Internal Revenue Service – Criminal Investigation (IRS-CI) Acting Special Agent in Charge Mark Silva of the Oakland Field Office.
Hallak was charged in a seven-count superseding indictment on April 21, 2016. The superseding indictment alleges that, between January 2010 and August 2014, Hallak and others operated a “business directory” telemarketing scam. Using a variety of means, including false and misleading cold calls and bogus invoices, Hallak and his co-defendants deceived churches, doctors’ offices, non-profits, mom-and-pop stores, and small businesses into paying for business directory services they neither ordered nor received.
As part of the scheme, Hallak and his co-defendants 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. Many of the shell companies used the term “Yellow Pages” to suggest their operations were legitimate. The superseding indictment further alleges that Hallak and the co-defendants caused others to cold call victims and tell them that they had a pre-existing business relationship with a “Yellow Pages” or other entity formed by the defendants; that they had previously purchased business directory services from the defendants; and that they owed the defendants for those services. Victims were told that they owed the defendants anywhere between $400 and $1800 for a previously purchased business directory listing. When such initial misrepresentations were not sufficient to induce payment, victims were harassed and threatened with legal action and sent additional bogus invoices with additional charges. The superseding indictment alleges that, as a result of the conspiracy, Hallak and others collected at least approximately $10.8 million.
The superseding indictment also charges Hallak with conspiracy to launder the proceeds of a separate telemarketing fraud, from March 2011 through in or about May 2013.
Hallak was arrested in Greece pursuant to an Interpol Red Notice and made his initial appearance in federal court in San Francisco on December 11, 2023. On the government’s motion, Defendant was detained. The Court set a detention hearing for December 21, 2023, at 10:30 a.m. before U.S. Magistrate Judge Sallie Kim.
The superseding indictment charges Hallak with one count of conspiracy to commit money laundering, in violation of 18 U.S.C. § 1956(h), one count of conspiracy to commit mail and wire fraud, in violation of 18 U.S.C. § 1349, four counts of mail fraud, in violation of 18 U.S.C. § 1341, and one count of wire fraud, in violation of 18 U.S.C. § 1343.
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 20 years in prison, a fine of $250,00 or twice the gross gain or loss, plus restitution if appropriate for each violation of 18 U.S.C. §§ 1341, 1343, and 1349. The maximum sentence for violation of 18 U.S.C. §1956(h) is 20 years in prison, plus a fine of $500,000, or twice the value of the monetary instrument or funds involved. 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 Robert S. Leach is prosecuting the case with the assistance of Megan Pagaduan. The prosecution is the result of an investigation by the U.S. Postal Inspection Service 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.
Disgruntled Cloud Engineer Sentenced to Two Years in Prison for Intentionally Damaging His Former Employer’s Computer Network After He Was FiredRead the Press Release
SAN FRANCISCO – Miklos Daniel Brody was sentenced to 24 months in prison today for a network intrusion and for making false statements to a government agency, announced United States Attorney Ismail J. Ramsey and United States Secret Service (USSS) Special Agent in Charge Shawn M. Bradstreet. The sentence was handed down by the Hon. William. H. Orrick, Senior United States District Judge.
Brody, 38, of San Francisco, pleaded guilty in April 2023 to two charges that he violated the Computer Fraud and Abuse Act—by obtaining information from a protected computer, in violation of 18 U.S.C. § 1030(a)(2)(C) and (c)(2)(B), and by intentionally damaging a protected computer, in violation of 18 U.S.C. § 1030(a)(5)(A) and (c)(4)(B)(i)—and one charge of making false statements to a government agency, in violation of 18 U.S.C. § 1001(a)(2).
According to a superseding indictment returned by a federal grand jury in December 2022, Brody worked as a cloud engineer for a bank headquartered in San Francisco until March 11, 2020, when he was fired for violating company policy.
The superseding indictment alleges that, later that evening, and continuing into the following morning, Brody used his company-issued laptop—which he failed to return upon being fired—to access the bank’s computer network without authorization and to cause substantial damage. Among other things, Brody deleted the bank’s code repositories, ran a malicious script to delete logs, left taunts within the bank’s code for former colleagues, and impersonated other bank employees by opening sessions in their names. He also emailed himself proprietary bank code that he had worked on as an employee, which was valued at over $5,000. At the sentencing hearing, Judge Orrick determined the total cost of the damage to the bank’s systems to be at least $220,621.22.
The superseding indictment also alleges that, in the days and weeks that followed his firing, Brody engaged in a series of evasive and deceptive actions, including filing a police report in which he falsely told the San Francisco Police Department that his company-issued laptop had been stolen from his car while he was working out at the gym. Brody doubled down on that false allegation in statements he made to USSS agents during an interview following his arrest in March 2021. In his guilty plea application, Brody admitted he made a false statement about the company-issued laptop and that he knew his statement was false at the time.
In addition to sentencing Brody to prison, Judge Orrick ordered him to pay restitution totaling $529,266.37 and to serve three years of supervised release to begin after his prison term is completed.
Assistant U.S. Attorneys Lauren M. Harding and George O. Hageman are prosecuting the case, with assistance from Paralegal Specialist Mark DiCenzo. The prosecution is the result of an investigation by the U.S. Secret Service.
Three Norteño Gang Members Who Murdered Victims in San Francisco Sentenced to Decades in Prison Following Their Convictions on Racketeering Conspiracy ChargesRead the Press Release
SAN FRANCISCO – Three San Francisco Mission District (SFMD) Norteño gang members who murdered and attempted to murder four victims in San Francisco between January 2018 and July 2019 were sentenced today to prison terms ranging from 21 to 33 years following their convictions on racketeering conspiracy charges, announced First Assistant United States Attorney Patrick D. Robbins and Federal Bureau of Investigation (FBI) Special Agent in Charge Robert K. Tripp. The sentences were handed down by the Hon. William H. Orrick, Senior United States District Judge.
Fernando Madrigal, AKA “Nando,” 25; Alvaro Reina Cordero, AKA “G-Boy,” 26; and Oscar Guadron Diaz, AKA “Cutty,” 24, all of San Francisco, each pleaded guilty in February 2023 to one count of racketeering conspiracy, in violation of 18 U.S.C. § 1962(d), in connection with their roles in the murders and attempted murder of four victims, including a 15-year-old innocent bystander who was mistaken for a rival gang member.
In his plea agreement, Madrigal—who was sentenced today to 33 years in prison—admitted that, on July 12, 2018, he lured a victim to a parking lot near Candlestick Park in San Francisco on the pretense of purchasing marijuana from the victim. In fact, however, Madrigal admitted that he planned to rob the victim and that he and an accomplice were both armed when they arrived at the parking lot near Candlestick Park, where they met the victim around 6:20 p.m. Madrigal admitted he shot and killed the victim, disposed of the victim’s cell phone on or near the San Mateo Bridge, and dumped the victim’s body in the Oakland Hills, where it was found more than a year later.
Madrigal also admitted that, on July 8, 2019, he was in the Mission District in San Francisco when he used an AR-style firearm to shoot and kill a 15-year-old boy whom Madrigal mistakenly believed was a member of a rival gang. Madrigal admitted he committed these two murders in part to earn respect from other SFMD Norteños and to enhance his status in the gang. Finally, Madrigal admitted that he regularly traveled between California and Iowa to engage in drug trafficking; that he possessed two firearms, dozens of bullets, and nearly $7,000 in cash when he was arrested on August 14, 2020; and that he was on probation following a prior carjacking conviction when he committed the murders in July 2018 and July 2019.
In their plea agreements, Cordero and Guadron Diaz—who were sentenced today to 26 and 21 years in prison, respectively—admitted that, on January 23, 2018, they were driving around the Holly Park neighborhood of San Francisco when they saw a suspected rival Sureño gang member standing with a female companion at a bus stop near the intersection of Leese Street and Richland Avenue. They also admitted that, upon confirming the man’s identity in another drive-by, Guadron Diaz (who was driving) parked about two blocks away from the bus stop, where he idled while Cordero—who was, and who Guadron Diaz knew to be, armed with a loaded gun—put on a black and white skeleton mask and got out of the car.
Cordero admitted he then ran to the bus stop, approached the man and his female companion, and fired approximately nine shots, hitting the man (who died) in the body and the woman (who survived) in the face. Cordero then ran back to the parked car and he and Guadron Diaz—who admitted in his plea agreement that he knew Cordero planned to shoot the man and that he knowingly assisted Cordero commit the shooting—drove away from the scene. Guadron Diaz also admitted that law enforcement officers found ammunition consistent with the type used in the murder and attempted murder, as well as a fully automatic machine gun, in a search of his home in San Francisco two days after the shooting. Finally, both Cordero and Guadron Diaz admitted they committed and participated in the murder and attempted murder to earn respect and prestige among other SFMD Norteño gang members.
“Norteño criminal street gangs have terrorized San Francisco’s Mission District for years through a relentless campaign of shootings, robberies, gun trafficking, drug dealing, and extortion,” said First Assistant United States Attorney Patrick D. Robbins. “Today’s sentences send a clear message that gang members who inflict wanton violence and harm our community will be arrested, prosecuted federally, and sentenced to lengthy prison terms.”
“The brazen acts of violence committed by these men deprived local residents of their sense of security,” said FBI San Francisco Special Agent in Charge Robert K. Tripp. “The sentences handed down today cannot undo the harm inflicted on the victims or their families, but the defendants have been held accountable. The FBI and its partners will continue to work to eradicate violent gangs from our streets.”
In addition to the custodial sentences, Judge Orrick ordered all three defendants to spend five years on supervised release, beginning after their prison terms are completed.
Assistant U.S. Attorney Leif Dautch is prosecuting the case with the assistance of Paralegal Specialist Kevin Costello. The prosecution is the result of a multi-year investigation by the FBI, with assistance from the San Francisco Police Department’s Community Violence Reduction Team and Homicide Detail.
Former San Francisco Department of Building Inspection Engineer Pleads Guilty to Honest Services Fraud ConspiracyRead the Press Release
SAN FRANCISCO - Rodolfo “Rudy” Pada pleaded guilty in federal court in San Francisco today to participating in an honest services fraud conspiracy, announced Criminal Division Deputy Chief Matthew Yelovich and FBI Special Agent in Charge Robert K. Tripp. The plea was accepted by the Hon. Susan Illston, U.S. District Judge.
In pleading guilty, Pada, 68 of Millbrae, CA, admitted that he accepted bribes from individuals seeking building and construction permits from the San Francisco Department of Building Inspection. Pada worked as a plan checker at DBI from 1984 to September 2017, reviewing and approving construction plans and providing builders with the permits necessary for residential and commercial construction projects in San Francisco.
According to the plea agreement, the bribes to Pada, which began in 2003 and continued until September 2017, consisted of cash, free meals, drinks, and other benefits, paid by executives at a construction planning and design firm. Pada accepted the bribes in return for expediting and approving permits for their building and construction plans. In addition, Pada solicited and accepted an interest-free $85,000 loan facilitated by one of the executives.
DBI is a regulatory city agency in San Francisco responsible for overseeing enforcement of building, electrical, plumbing, and housing codes for the City of San Francisco’s more than 200,000 commercial and residential buildings. Contractors and builders submit construction plans to DBI for approval and permitting; the plans are required to be reviewed and approved by DBI to insure that the proposed construction and building meets city codes and regulations.
Pada, was initially charged by a criminal complaint in May 2022. On Nov. 3, 2023, Pada was charged by Information with one count of conspiracy to commit honest services wire fraud, in violation of 18 U.S.C. § 1349. Under the plea agreement, Pada pleaded guilty to the single count in the Information.
Judge Illston scheduled Pada’s sentencing hearing for March 29, 2024. The maximum statutory penalty is 20 years imprisonment and a $250,000 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.
Assistant U.S. Attorney David Ward is prosecuting the case with the assistance of Aarian Beiti. The prosecution is the result of an investigation by the Federal Bureau of Investigation.
Two Russian Nationals Working with Russia’s Federal Security Service Charged with Global Computer Intrusion CampaignRead the Press Release
A federal grand jury in San Francisco returned an indictment on Tuesday charging two individuals 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.
According to court documents, Ruslan Aleksandrovich Peretyatko (Перетятько Руслан Александрович), an officer in Russia’s Federal Security Service (FSB) Center 18, Andrey Stanislavovich Korinets (Коринец Андрей Станиславович) and other unindicted conspirators employed a sophisticated spear phishing campaign to gain unauthorized, persistent access (i.e., “hack”) into victims’ computers and email accounts.
“The Russian government continues to target the critical networks of the United States and our partners, as highlighted by the indictment unsealed today,” said Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division. “Through this malign influence activity directed at the democratic processes of the United Kingdom, Russia again demonstrates its commitment to using weaponized campaigns of cyber espionage against such networks in unacceptable ways. The Department of Justice will respond to such behavior with an even more determined commitment to disrupt those activities and to hold accountable the individuals responsible.”
“Today’s indictment is part of a coordinated international response to send a message to the conspirators that the whole of the United States government stands together and with our partners internationally to identify and disrupt cyber espionage actors, particularly those seeking to obtain government information and attempting to create chaos in democratic processes,” said U.S. Attorney Ismail J. Ramsey for the Northern District of California. “We are grateful to all of our partners for their assistance in addressing these threats posed by the FSB’s action in the Northern District of California, across the United States and around the world.”
“The FBI will not stand idly by as Russia continues to perpetuate this type of targeted malicious activity,” said Assistant Director Bryan Vorndran of the FBI’s Cyber Division. “Russian interference through malign foreign influence campaigns is deplorable, and we will not tolerate it in the United States or directed against our foreign partners. The FBI is dedicated to combating this pervasive threat and will tirelessly seek to prevent and disrupt these criminal acts carried out by Russia.”
The indictment, which was unsealed today, alleges the conspiracy targeted current and former employees of the U.S. Intelligence Community, Department of Defense, Department of State, defense contractors, and Department of Energy facilities between at least October 2016 and October 2022. In addition, the indictment alleges the conspirators – known publicly by the name “Callisto Group” – targeted military and government officials, think tank researchers and staff, and journalists in the United Kingdom and elsewhere, and that information from certain of these targeted accounts was leaked to the press in Russia and the United Kingdom in advance of U.K. elections in 2019.
As a common example, the conspirators used “spoofed” email accounts designed to look like personal and work-related email accounts of the group’s targets. The conspirators allegedly also sent sophisticated looking emails that appeared to be from email providers suggesting users had violated terms of service. These messages were designed to trick victims into providing their email account credentials to false login prompts. Once the conspirators fraudulently obtained the victim’s credentials, they were able to use those credentials to access the victims’ email accounts at will.
In addition to the indictment, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced that it has sanctioned both Peretyatko and Korinets for their roles in malicious cyber-enabled activity. Moreover, the United Kingdom has issued sanctions of its own, and the U.S. Department of State announced rewards of up to $10 million for information leading to the identification or location of Peretyatko and Korinets, as well as their conspirators.
In addition to the name “Callisto Group,” FSB Center 18 is known by cybersecurity investigators as “Dancing Salome” by Kaspersky Labs, “STAR BLIZZARD” by Microsoft Threat Intelligence Center and “COLDRIVER” by Google’s Threat Analysis Group.
The defendants are each charged with one count of conspiracy to commit an offense against the United States, namely, computer fraud, which carries a maximum sentence of five years in prison for PERETYATKO, and up to 10 years for KORINETS. The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencings of the defendants will be determined by the assigned judge.
The investigation was conducted jointly by the U.S. Attorney’s Office for the Northern District of California, the National Security Cyber Section of the Justice Department’s National Security Division and the FBI San Francisco Field Office. The FBI’s Cyber Division, Cyber Assistant Legal Attachés, and Legal Attachés in countries around the world provided essential support. Numerous victims cooperated and provided valuable assistance in the investigation.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Note: This release has been updated to reflect the correct criminal offense and statutory penalties.
Peretyatko Korinets indictmentTwo Russian Nationals Working with Russia’s Federal Security Service Charged with Global Computer Intrusion CampaignRead the Press Release
SAN FRANCISCO – A federal grand jury in San Francisco returned an indictment on Tuesday charging two individuals 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.
According to court documents, Ruslan Aleksandrovich Peretyatko (Перетятько Руслан Александрович), an officer in Russia’s Federal Security Service (FSB) Center 18, Andrey Stanislavovich Korinets (Коринец Андрей Станиславович) and other unindicted conspirators employed a sophisticated spear phishing campaign to gain unauthorized, persistent access (i.e., “hack”) into victims’ computers and email accounts.
“The Russian government continues to target the critical networks of the United States and our partners, as highlighted by the indictment unsealed today,” said Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division. “Through this malign influence activity directed at the democratic processes of the United Kingdom, Russia again demonstrates its commitment to using weaponized campaigns of cyber espionage against such networks in unacceptable ways. The Department of Justice will respond to such behavior with an even more determined commitment to disrupt those activities and to hold accountable the individuals responsible.”
“Today’s indictment is part of a coordinated international response to send a message to the conspirators that the whole of the United States government stands together and with our partners internationally to identify and disrupt cyber espionage actors, particularly those seeking to obtain government information and attempting to create chaos in democratic processes,” said U.S. Attorney Ismail J. Ramsey for the Northern District of California. “We are grateful to all of our partners for their assistance in addressing these threats posed by the FSB’s action in the Northern District of California, across the United States and around the world.”
“The FBI will not stand idly by as Russia continues to perpetuate this type of targeted malicious activity,” said Assistant Director Bryan Vorndran of the FBI’s Cyber Division. “Russian interference through malign foreign influence campaigns is deplorable, and we will not tolerate it in the United States or directed against our foreign partners. The FBI is dedicated to combating this pervasive threat and will tirelessly seek to prevent and disrupt these criminal acts carried out by Russia.”
“Countering the persistent threat to critical infrastructure posed by state-sponsored Russian cybercriminals remains a top priority for the FBI,” said FBI San Francisco Division Special Agent in Charge Robert Tripp. “Today’s charging announcement underscores the FBI’s commitment to collaborate with our U.S. and international partners to disrupt these activities. We will identify those responsible and hold them accountable.”
The indictment, which was unsealed today, alleges the conspiracy targeted current and former employees of the U.S. Intelligence Community, Department of Defense, Department of State, defense contractors, and Department of Energy facilities between at least October 2016 and October 2022. In addition, the indictment alleges the conspirators – known publicly by the name “Callisto Group” – targeted military and government officials, think tank researchers and staff, and journalists in the United Kingdom and elsewhere, and that information from certain of these targeted accounts was leaked to the press in Russia and the United Kingdom in advance of U.K. elections in 2019.
As a common example, the conspirators used “spoofed” email accounts designed to look like personal and work-related email accounts of the group’s targets. The conspirators allegedly also sent sophisticated looking emails that appeared to be from email providers suggesting users had violated terms of service. These messages were designed to trick victims into providing their email account credentials to false login prompts. Once the conspirators fraudulently obtained the victim’s credentials, they were able to use those credentials to access the victims’ email accounts at will.
In addition to the indictment, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced that it has sanctioned both Peretyatko and Korinets for their roles in malicious cyber-enabled activity. Moreover, the United Kingdom has issued sanctions of its own, and the U.S. Department of State announced rewards of up to $10 million for information leading to the identification or location of Peretyatko and Korinets, as well as their conspirators.
In addition to the name “Callisto Group,” FSB Center 18 is known by cybersecurity investigators as “Dancing Salome” by Kaspersky Labs, “STAR BLIZZARD” by Microsoft Threat Intelligence Center and “COLDRIVER” by Google’s Threat Analysis Group.
The defendants are each charged with one count of conspiracy to commit an offense against the United States, namely, computer fraud, which carries a maximum sentence of five years in prison for PERETYATKO, and up to 10 years for KORINETS. The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencings of the defendants will be determined by the assigned judge.
The investigation was conducted jointly by the U.S. Attorney’s Office for the Northern District of California, the National Security Cyber Section of the Justice Department’s National Security Division and the FBI San Francisco Field Office. The FBI’s Cyber Division, Cyber Assistant Legal Attachés, and Legal Attachés in countries around the world provided essential support. Numerous victims cooperated and provided valuable assistance in the investigation.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
indictment.pdfSan Francisco Resident Sentenced to Six Years in Prison for Manufacturing and Dealing FirearmsRead the Press Release
SAN FRANCISCO – Craig Bolland was sentenced today to 72 months (six years) in prison after pleading guilty to manufacturing and dealing firearms without a license and several other firearms-related offenses, announced United States Attorney Ismail J. Ramsey and Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF) Special Agent in Charge Jennifer L. Cicolani. The sentence was handed down by the Hon. Vince Chhabria, United States District Judge.
Bolland, 40, of San Francisco, was indicted by a federal grand jury on August 2, 2023, on four charges: (i) manufacturing and dealing firearms without a license, in violation of 18 U.S.C. § 922(a)(1)(A); (ii) being a felon in possession of a firearm, in violation of 18 U.S.C. § 922(g)(1); (iii) possession of a firearm with an obliterated serial number, in violation of 18 U.S.C. § 922(k); and (iv) possession of a machinegun, in violation of 18 U.S.C. § 922(o). He pleaded guilty to all four charges on September 13, 2023.
In the plea agreement, Bolland admitted, among other things, that, despite not having a license to do so, he was in the business of manufacturing and selling firearms—including hard-to-trace “ghost guns” he manufactured himself using a 3-D printer and parts he had shipped to him—from at least June 2021 through May 30, 2023, the date of his arrest. Bolland admitted he sold at least five of these privately manufactured “ghost guns” (both pistols and rifles), as well as dozens of commercially manufactured firearms—some of which Bolland admitted he modified by installing “switches” that turned semi-automatic weapons into fully automatic weapons—to buyers he knew or had reason to know were criminals who were not legally allowed to possess firearms and who paid Bolland for the guns in cash, cryptocurrency, and/or narcotics.
According to the plea agreement, Bolland, who had previously been convicted of a felony, possessed five firearms on the date of his arrest, including four handguns and a fully automatic AR-15 style rifle with no serial number. He also possessed hundreds of rounds of ammunition of varying calibers. Finally, Bolland admitted in the plea agreement that, in addition to his own firearms dealing, he brokered multiple sales of firearms and ammunition between other sellers and buyers and that he received a commission for brokering such deals.
In addition to the prison term, Judge Chhabria ordered Bolland to serve three years of supervised release to begin after his prison term is completed.
Assistant U.S. Attorney George O. Hageman is prosecuting the case with assistance from Amala James. The prosecution is the result of an investigation by ATF and the San Francisco Police Department.
Former Correctional Officer Sentenced to More Than Five Years in Prison for Sexual Abuse of Two Female InmatesRead the Press Release
OAKLAND - Former federal correctional officer John Bellhouse was sentenced today to 63 months in prison, followed by five years of supervised release and ordered to pay $25,500 for his sexually abusive conduct against two female victims who were serving prison sentences at Federal Correctional Institution (FCI) Dublin. The sentence was handed down by U.S. District Judge Yvonne Gonzalez Rogers.
Bellhouse, 40, formerly of Pleasanton, Calif., was initially charged with sexual abuse of an inmate on Feb. 17, 2022. A federal grand jury issued a superseding indictment on Sept. 29, 2022, charging Bellhouse with two counts of sexual abuse of a ward and three counts of abusive sexual contact that occurred between December 2019 and December 2020. A jury convicted Bellhouse of all counts.
“John Bellhouse exploited his position of trust at the Federal Bureau of Prisons by sexually abusing multiple women in his custody – and today he has been held to account,” said Deputy Attorney General Lisa O. Monaco. “The sentence of imprisonment imposed today is the latest example of the Justice Department’s continuing work to address the egregious misconduct that took place at FCI Dublin and prioritize the eradication of sexual assault from our prison system.”
“This defendant’s conduct was a disturbing deviation from the expectations and requirements of all federal correctional officers,” said U.S. Attorney Ismail J. Ramsey for the Northern District of California. “Bellhouse violated his oath and abused the power given to him, all to victimize the people he was supposed to protect. This sentence makes clear that the sexual abuse of inmates by guards will not be tolerated.”
“While today’s sentencing cannot undo the horrific abuse that Bellhouse’s victims endured, it sends a clear message that BOP employees who abuse inmates in their custody and care will be brought to justice. Our investigation of sexual abuse at FCI Dublin remains ongoing, and we will continue to aggressively pursue justice for victims of sexual abuse at the hands of BOP employees,” said Department of Justice Inspector General Michael E. Horowitz.
“The horrendous sexual abuse committed by convicted offender John Bellhouse is cruel and despicable,” said FBI Deputy Director Paul Abbate. “As a federal corrections officer, Bellhouse sexually abused inmates under his care and attempted to cover-up his crimes. These violations are inexcusable breaches of the trust and authority granted to government officials. This sentencing is a reminder that the FBI and our partners will relentlessly pursue those who physically harm others and hold them accountable.”
“John Bellhouse has been held accountable for his abhorrent actions, preying upon vulnerable individuals in his custody,” said FBI Special Agent in Charge Robert K. Tripp of the San Francisco Division. “Our investigation continues. We will find justice for victims of these heinous crimes.”
Bellhouse was employed as a correctional officer at the FCI Dublin, California, an all-female low security federal correctional institution. Trial evidence showed that beginning December 2019 through October 2020 Bellhouse sexually abused and committed abusive sexual contact against a victim incarcerated and serving a prison sentence at FCI Dublin under Bellhouse’s custodial, supervisory, and disciplinary authority. Bellhouse engaged in oral sex with the victim in the prison Safety Warehouse and Safety Office and touched the victim’s vagina and breasts in the prison Safety Office, according to the trial evidence.
Evidence presented at trial also demonstrated Bellhouse committed abusive sexual contact against a second victim between October and December of 2020. Trial evidence showed that the acts occurred in the Safety Office at the FCI Dublin Camp.
The trial evidence further showed that Bellhouse sexually abused another inmate in 2020 and 2021 when he reached through a window in her cell and grabbed her breast, and on another occasion put his finger in her vagina without her consent while she was in her cell after showering.
In a memorandum filed in connection with Bellhouse’s sentencing, the government provided additional information regarding Bellhouse’s criminal conduct while he was a correctional officer. In the memorandum, the government argued that in addition to the three women who testified at trial about Bellhouse’s sexual abuse of them, Bellhouse also abused other women. Further, the government’s memorandum describes how Bellhouse used his ability to access everyday items such as Starbucks coffee, yarn, jewelry, and cleaning supplies, to get his victims both to acquiesce in the abuse and to keep them quiet about his conduct. For example, according to the memorandum, Bellhouse would provide items to coax compliance with his demands. Because these items were considered contraband at FCI Dublin, mere possession of them exposed inmates to potential punishments such as solitary confinement and loss of good time credits.
Bellhouse was convicted of two counts of sexual abuse of a ward, and three counts of abusive sexual conduct.
Judge Gonzalez Rogers ordered Bellhouse to surrender on or before Feb. 2, 2024, to begin serving his sentence. In addition, Judge Gonzalez Rogers scheduled a hearing for Feb. 1, 2024, to determine issues regarding restitution.
The Department of Justice’s Office of Inspector General and the FBI investigated the case.
Assistant U.S. Attorneys Molly Priedeman and Andrew Paulson prosecuted the case with the assistance of Madeline Wachs, Sara Slattery, Leeya Kekona, and Kay Konopaske.
San Francisco Motorist Charged in Death of A Bicyclist in the PresidioRead the Press Release
SAN FRANCISCO - A federal grand jury in San Francisco indicted Arnold Kinman Low today with involuntary manslaughter and operating a motor vehicle under the influence of alcohol, announced United States Attorney Ismail J. Ramsey and United States Park Police Chief Jessica M.E. Taylor.
According to the indictment, Low, 81, of San Francisco, was the driver of a motor vehicle that struck a bicyclist in the Presidio on April 4, 2023. The victim-bicyclist died of his injuries shortly after the crash. Low is alleged to have been under the influence of alcohol at the time of the crash, to a degree that rendered him incapable of safe operation.
Driving while under the influence of any amount of alcohol can have serious and sometimes fatal consequences. The United States Attorney for the Northern District of California takes seriously all allegations of driving under the influence in places of federal jurisdiction like the Presidio Trust. Area drivers are reminded to consider alternative forms of transportation like ride-sharing or carpooling if necessary.
Low currently is scheduled to make his initial appearance in federal court in San Francisco at 10:30 AM on December 6, 2023, before U.S. Magistrate Judge Alex Tse.
An indictment merely alleges that crimes have been committed, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt. If convicted, the defendant faces a maximum sentence of 8 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.
Assistant U.S. Attorney George Hageman is prosecuting the case with the assistance of Erick Machado. The prosecution is the result of an investigation by the United States Park Police.
President of Brisbane Recycling Company and Its Former Counsel Sentenced to Prison for Tax FraudRead the Press Release
SAN FRANCISCO - Joseph Nubla and Henry Ku were sentenced today to 36 months and 30 months in prison, respectively, following their convictions by a jury at trial in April 2023 on charges of conspiracy to defraud the United States and tax evasion, announced United States Attorney Ismail J. Ramsey and Internal Revenue Service – Criminal Investigation (IRS-CI) Acting Special Agent in Charge Mark Silva of the Oakland Field Office. The sentences were handed down by the Hon. Richard Seeborg, Chief U.S. District Court Judge for the Northern District of California.
Nubla, 45, of Danville, California, is—and at all relevant times was—President of Brisbane Recycling Company, Inc. (“Brisbane”), a rock-crushing business located in Brisbane, California. Ku, 56, of Pleasanton, California, was formerly counsel for Brisbane and Nubla. Both defendants were convicted by a jury on April 7, 2023, following a two-week trial on charges that they conspired to defraud the United States from 2008 through 2016, in violation of 18 U.S.C. § 371. Nubla was also convicted of one count of tax evasion, in violation of 26 U.S.C. § 7201, for failing to report more than $5.8 million in income on his 2014 federal tax return.
The evidence at trial showed that Nubla ran daily operations at Brisbane and that Ku owned and controlled several businesses, including Pegasus Aggregate, Inc., Jupiter Prime Monarch, and JPM Energy, Inc. (collectively, “Ku’s entities”). Between February 20, 2009, and March 30, 2015, Ku and his entities deposited checks written by Nubla from Brisbane and totaling more than $18 million. To avoid paying corporate income taxes for Brisbane, Nubla expensed Brisbane’s payments to Ku’s entities as royalties for the use of heavy equipment purportedly owned by Ku’s entities. In fact, however, Ku had used the funds from Brisbane to purchase that equipment. Ku also returned the funds he received from Brisbane to Nubla in a variety of ways: (i) by regular money transfers from 2009 through 2016; (ii) by purchasing three homes for Nubla; and (iii) by writing cashier’s checks totaling $7 million pursuant to a fake loan. Nubla did not declare the funds given to him by Ku as personal income, even though they originated from Brisbane and thus were taxable, constructive dividends.
“These defendants skirted paying their taxes out of pure greed,” said U.S. Attorney Ramsey. “Today’s sentences send a clear message to those who try to avoid paying their fair share that our office will always marshal its resources to protect the public treasury.”
“The schemes orchestrated by Mr. Nubla and Mr. Ku seeking to defraud the United States and evade our tax system were rooted in blatant greed,” said IRS-CI Acting Special Agent in Charge Silva. “Today’s sentencing reaffirms that IRS-CI special agents are superbly motivated and equipped to disrupt, foil, and eliminate future nefarious attempts to defraud and evade our government. Just outcomes like today’s sentencing help protect responsible law-abiding business owners and taxpayers.”
In addition to the custodial sentences, Chief Judge Seeborg ordered Nubla and Ku to pay fines of $15,000 and $10,000, respectively, and $9,322,549.20 in restitution—a sum for which the defendants are jointly and severally liable.
Assistant U.S. Attorney Daniel N. Kassabian and Trial Attorney Christopher J. Carlberg of the Department of Justice’s Antitrust Division are prosecuting the case, with assistance from Helen Yee, Veronica Hernandez, and Amala James. The prosecution is the result of an investigation by IRS-CI.
California Man Sentenced to 52 Months in Prison for Firearms-Related CrimesRead the Press Release
SAN FRANCISCO – Trajordon Svarda was sentenced to 52 months in prison for crimes related to his firearms sales—including the sale of a machinegun—to a confidential informant (CI), announced United States Attorney Ismail J. Ramsey and Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) Special Agent in Charge Jennifer Cicolani. The sentence was handed down by the Hon. William H. Alsup, Senior United States District Judge.
Svarda, 36, of San Francisco, pleaded guilty to one count of Felon in Possession of a Firearm, in violation of 18 U.S.C. § 922(g)(1), and one count of Illegal Possession of a Machinegun, in violation of 18 U.S.C. § 922(o), on July 12, 2023. He was charged by Information on January 11, 2023.
According to his plea agreement, Svarda sold drugs and firearms to a CI throughout early 2021. The sales began in February 2021, when Svarda sold the CI ecstasy on two occasions. In March, Svarda added firearms to his list of goods for sale, selling the CI ecstasy and a pistol, which ATF later determined was stolen. Later in March, Svarda sold the CI ecstasy, a Smith and Wesson revolver, and a privately made, AR style, .223 caliber pistol. The AR style pistol was a “ghost gun,” meaning it was privately made and did not bear a serial number.
As court documents show, the sales continued throughout April and July. On July 22, 2023, Svarda sold the CI methamphetamine and another privately manufactured AR-style pistol. The privately manufactured AR-style pistol was capable of automatically shooting more than one shot without manual reloading, via a single function of the trigger. At the time of the sale, Svarda showed the CI how to turn the AR-style pistol into a fully automatic weapon using this function.
In total, Svarda admitted to selling to the CI over 150 grams of ecstasy, 157 grams of methamphetamine, and six firearms. In addition, Svarda admitted that he knew at the time that previously he had been convicted of at least one felony.
In addition to the prison term, Judge Alsup ordered Svarda to serve three years of supervised release to begin after his prison term is completed.
Assistant U.S. Attorney Sophia Cooper prosecuted the case, with the assistance of Paralegal Specialist Tina Rosenbaum. The prosecution is the result of an investigation by ATF.
San Francisco Resident Charged with Murder of A Person Whose Body Was Found in the PresidioRead the Press Release
SAN FRANCISCO – The Office of the United States Attorney has filed a federal criminal complaint charging Leion Butler with aiding and abetting murder after surveillance videos led investigators to conclude Butler was involved in the murder of a victim whose lifeless body was found on November 12, 2023, in the Presidio, in San Francisco, Calif. The complaint was filed November 20, 2023, and was unsealed earlier today.
According to the complaint, Butler, 20, of San Francisco, is responsible for the murder of the victim found in the Presidio on November 12, 2023. Early that morning, witnesses discovered a deceased body in the parking lot of Crissy Field East Beach in the Presidio. The complaint describes how the victim was found to have suffered from a single gunshot wound to his head.
The criminal complaint describes how investigators reviewed video from surveillance cameras near where the body was found, including those capturing cars leaving the area near the time of the murder. One of the cars observed leaving the area was linked to the deceased victim. Three days later, the victim’s vehicle was located, unoccupied, with its license plates still attached. The car reportedly was double parked for days in a street in the Hunters Point neighborhood of San Francisco. The criminal complaint describes how investigators obtained additional surveillance footage from cameras near where the victim’s car was found. The additional surveillance video captured the arrival of the victim’s car and showed someone—later identified as the defendant—parking the car, exiting, and speaking into a cellphone. Further, the video captured the eventual arrival of a second car. The criminal complaint further describes how the surveillance camera captured images of the defendant speaking with the driver of the second car, the defendant making several trips between the victim’s car and the second car, and the defendant wiping down the driver’s side door and interior of the victim’s car with “a clothing item or towel.” In addition, the video showed additional images of the defendant retrieving items from the victim’s car and eventually getting into the second vehicle and leaving the scene.
The complaint describes how further investigation led investigators to discover the name of the person who owned the second vehicle and, eventually, to the defendant. According to investigators, the defendant both fit the description of the person who parked the victim’s car in Hunter’s Point and was related to the owner of the second vehicle. Further, investigators developed evidence establishing that on the day of the murder, the defendant’s cell phone was both in the general area where the victim was found and where the victim’s car was wiped down.
In sum, Butler is charged with murder, in violation of 18 U.S.C. §§ 1111 and 2.
A criminal complaint merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. The maximum statutory penalty for murder is death or life imprisonment. 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.
Butler was arrested on November 20, 2023, and remains in federal custody. Butler appeared this morning before U.S. Magistrate Judge Sallie Kim to face the charges. Butler pleaded not guilty. Butler’s next appearance is scheduled for November 22, 2023, before Magistrate Judge Kim, for further status on detention.
Assistant U.S. Attorney Kelsey Davidson is prosecuting the case. The prosecution is the result of an investigation by the Federal Bureau of Investigation.
Cyber Scam Organization Disrupted Through Seizure of Nearly $9M in CryptoRead the Press Release
The Justice Department announced today the seizure of nearly $9 million worth of Tether, a cryptocurrency pegged to the U.S. dollar. These seized funds were traced to cryptocurrency addresses allegedly associated with an organization that exploited over 70 victims through romance scams and cryptocurrency confidence scams, which are widely known as “pig butchering.”
“Through this significant seizure, we disrupted the financial infrastructure of an organized network of scammers who stole millions from victims across the United States. These scammers prey on ordinary investors by creating websites that tell victims their investments are working to make them money. The truth is that these international criminal actors are simply stealing cryptocurrency and leaving victims with nothing,” said Acting Assistant Attorney General Nicole M. Argentieri of the Justice Department’s Criminal Division. “The department hopes this recovery of assets will bring some closure and a sense of justice to the over 70 victims affected by this series of scams. This seizure should also serve as a reminder to cybercriminals that, although the current landscape of the cryptocurrency ecosystem may seem like an ideal way to launder ill-gotten gains, law enforcement will continue to develop the expertise needed to follow the money and seize it back for victims.”
According to court documents, criminal actors worked together to target victims and convince them to make cryptocurrency deposits by fraudulently representing that the victims were making investments with trusted firms and cryptocurrency exchanges. In reality, the purported firms and cryptocurrency exchanges were non-existent trading platforms. Agents and analysts from the U.S. Secret Service (USSS) were able to trace those victim deposits and observed that the funds were quickly laundered through dozens of cryptocurrency addresses and exchanged for several different cryptocurrencies, a money laundering technique often referred to as “chain hopping.” These techniques are used to “layer” the proceeds of criminal activity into new cryptocurrency ecosystems, all to obfuscate the nature, source, control, and ownership of those proceeds. The seized funds were linked to numerous victim reports made via the FBI’s Internet Crime Complaint Center (IC3) and Federal Trade Commission’s (FTC) Consumer Sentinel Network.
“This seizure is the culmination of the exceptional hard work and collaborative partnership between the Justice Department and the United States Secret Service,” said U.S. Attorney Ismail J. Ramsey for the Northern District of California. “Silicon Valley remains one of the world’s preeminent locations for cryptocurrency firms. As such, we remain dedicated to using all tools at our disposal to bring justice to the victims of frauds and scams. Even when money and criminals are abroad, we will work with our partners to seize cyber criminals’ illegal proceeds.”
“This seizure exemplifies the Secret Service’s mission to protect the financial infrastructure of the United States. We remain determined and vigilant to combat cyber-enabled financial fraud,” said Special Agent in Charge Shawn Bradstreet of the USSS San Franscisco Field Office. “It is a priority for the Secret Service to protect the financial security that citizens work so hard to obtain. We want to thank the Justice Department for their partnership, dedication, and outstanding work on this case.”
The USSS San Francisco Field Office investigated this case.
Trial Attorney Georgiana MacDonald of the Criminal Division’s Computer Crime and Intellectual Property Section, National Cryptocurrency Enforcement Team, and Assistant U.S. Attorneys Chris Kaltsas and Galen Phillips for the Northern District of California are handling the case, as well as the seizure and forfeiture actions.
The department would like to acknowledge Tether for its assistance in effectuating the transfer of these assets.
If you are a victim of a cryptocurrency scam, or other scam involving the use of the Internet, please file a report with the IC3 at ic3.gov and with the FTC at www.reportfraud.ftc.gov.
Cyber Scam Organization Disrupted Through Seizure of Nearly $9M in CryptoRead the Press Release
SAN FRANCISCO – The Justice Department announced today the seizure of nearly $9 million worth of Tether, a cryptocurrency pegged to the U.S. dollar. These seized funds were traced to cryptocurrency addresses allegedly associated with an organization that exploited over 70 victims through romance scams and cryptocurrency confidence scams, which are widely known as “pig butchering.”
“Through this significant seizure, we disrupted the financial infrastructure of an organized network of scammers who stole millions from victims across the United States. These scammers prey on ordinary investors by creating websites that tell victims their investments are working to make them money. The truth is that these international criminal actors are simply stealing cryptocurrency and leaving victims with nothing,” said Acting Assistant Attorney General Nicole M. Argentieri of the Justice Department’s Criminal Division. “The department hopes this recovery of assets will bring some closure and a sense of justice to the over 70 victims affected by this series of scams. This seizure should also serve as a reminder to cybercriminals that, although the current landscape of the cryptocurrency ecosystem may seem like an ideal way to launder ill-gotten gains, law enforcement will continue to develop the expertise needed to follow the money and seize it back for victims.”
“This seizure is the culmination of the exceptional hard work and collaborative partnership between the Justice Department and the United States Secret Service,” said U.S. Attorney Ismail J. Ramsey for the Northern District of California. “Silicon Valley remains one of the world’s preeminent locations for cryptocurrency firms. As such, we remain dedicated to using all tools at our disposal to bring justice to the victims of frauds and scams. Even when money and criminals are abroad, we will work with our partners to seize cyber criminals’ illegal proceeds.”
“This seizure exemplifies the Secret Service’s mission to protect the financial infrastructure of the United States. We remain determined and vigilant to combat cyber-enabled financial fraud,” said Special Agent in Charge Shawn Bradstreet of the USSS San Francisco Field Office. “It is a priority for the Secret Service to protect the financial security that citizens work so hard to obtain. We want to thank the Justice Department for their partnership, dedication, and outstanding work on this case.”
According to court documents, criminal actors worked together to target victims and convince them to make cryptocurrency deposits by fraudulently representing that the victims were making investments with trusted firms and cryptocurrency exchanges. In reality, the purported firms and cryptocurrency exchanges were non-existent trading platforms. Agents and analysts from the U.S. Secret Service (USSS) were able to trace those victim deposits and observed that the funds were quickly laundered through dozens of cryptocurrency addresses and exchanged for several different cryptocurrencies, a money laundering technique often referred to as “chain hopping.” These techniques are used to “layer” the proceeds of criminal activity into new cryptocurrency ecosystems, all to obfuscate the nature, source, control, and ownership of those proceeds. The seized funds were linked to numerous victim reports made via the FBI’s Internet Crime Complaint Center (IC3) and Federal Trade Commission’s (FTC) Consumer Sentinel Network.
The USSS San Francisco Field Office investigated this case.
Trial Attorney Georgiana MacDonald of the Criminal Division’s Computer Crime and Intellectual Property Section, National Cryptocurrency Enforcement Team, and Assistant U.S. Attorneys Chris Kaltsas and Galen Phillips for the Northern District of California are handling the case, as well as the seizure and forfeiture actions.
The department would like to acknowledge Tether for its assistance in effectuating the transfer of these assets.
If you are a victim of a cryptocurrency scam, or other scam involving the use of the Internet, please file a report with the IC3 at ic3.gov and with the FTC at www.reportfraud.ftc.gov.
Former San Mateo Resident Pleads Guilty to Embezzling More Than $1.1 Million from San Francisco Law FirmRead the Press Release
SAN FRANCISCO – Jairo Tomas Santos pleaded guilty in San Francisco federal court today to bank fraud, announced United States Attorney Ismail J. Ramsey and Federal Bureau of Investigation Special Agent in Charge Robert K. Tripp. The plea was accepted by the Honorable William Alsup, U.S. District Judge.
In pleading guilty, Santos, 42, formerly of San Mateo, Calif., admitted to embezzling more than $1.1 million from his employer, a San Francisco-based law firm, where Santos worked as the office manager. According to his plea agreement, Santos began embezzling from his employer in March of 2016 and continued with his scheme through February 2023. As part of the scheme, Santos obtained checks from the victim law firm, filled out the payee line of those checks, addressing them to “Jairo Santos,” and signed each check with the signature of the law firm’s senior partner even though Santos was not authorized to do so. Santos then deposited these checks into his personal checking accounts at Wells Fargo Bank. Santos admitted to depositing approximately 806 fraudulent and unauthorized checks from the victim law firm made payable to Santos into his personal checking accounts. The total value of these unauthorized deposits was approximately $1,191,683. Santos deposited these checks from the victim law firm knowing that the payments were not authorized by the firm or its senior partner.
A federal grand jury indicted Santos on July 25, 2023, charging him with three counts of bank fraud, in violation of 18 U.S.C. § 1344. Under the plea agreement, Santos pleaded guilty to one count. If Santos complies with the plea agreement, the remaining counts of bank fraud will be dismissed at sentencing.
Santos is currently free on bond. Judge Alsup scheduled Santos’s sentencing hearing for March 12, 2024, at 11:00 a.m. The maximum statutory penalty for the 18 U.S.C. § 1344 violation is 30 years in prison and a fine of $1,000,000. The court may also ordered Santos to serve an additional term of supervised release and may order restitution, if appropriate. 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 U.S. Attorney Christiaan Highsmith is prosecuting the case with the assistance of Aarian Beiti. The prosecution is the result of an investigation by the FBI.
David DePape Convicted of Assault and Attempted Kidnapping ChargesRead the Press Release
SAN FRANCISCO – A federal jury convicted David DePape of assault and attempted kidnapping charges today in connection with his Oct. 28 intrusion into the home of Speaker Emerita Nancy Pelosi and her husband Paul Pelosi, announced United States Attorney Ismail J. Ramsey and Federal Bureau of Investigation Special Agent in Charge Robert K. Tripp. The verdict follows a trial before the Hon. Jacqueline Scott Corley, U.S. District Judge.
U.S. Attorney Ramsey stated, “We are grateful to the jury for their deliberations and the justice that this verdict signifies. Our public servants and their families deserve to work and live without threats and violence. Defendant’s violent plan to kidnap then-Speaker Pelosi was rooted in his virulent disagreement with her as a result of her official position. His violent plan ended with the assault on Mr. Pelosi. Today’s verdict brings justice to the Pelosi family and to the idea that violence has no place in politics.”
“The brutal and premeditated assault on Mr. Pelosi in the sanctity of his own home was fueled by DePape’s misguided ideology. I am deeply gratified by the jury's verdict, which has ensured that DePape will face the full weight of justice," said FBI Special Agent in Charge Tripp. "The unwavering collaboration between the FBI, the San Francisco Police Department, the San Francisco District Attorney's Office, and the United States Capitol Police played a pivotal role in securing this victory. We remain steadfast in our commitment to protecting our communities from those who seek to divide us through acts of violence and hatred.”
The evidence at trial established that weeks before the attack, DePape, 43, of Richmond, California, targeted Nancy Pelosi, who was then Speaker of the U.S. House of Representatives, and collected personal information about her, including her home address. DePape kept the information in a computer file he labeled “favorite politicians.” DePape intended to kidnap the then-Speaker, hold her hostage, and break her kneecaps.
The evidence at trial demonstrated that on the night of the assault, DePape used public transportation to travel from the East Bay to San Francisco while carrying two backpacks that contained a hammer, sledgehammer, duct tape, rope, zip ties, and electronic items, among other items. After arriving at the Pelosi residence, DePape used the hammer to break the window of a glass door and enter the home. Then-Speaker Pelosi was not home and her husband, Paul Pelosi, was sleeping on the third floor of the home. DePape roamed the home until he found Mr. Pelosi in the third-floor bedroom.
The trial evidence demonstrated that DePape woke Mr. Pelosi and, while standing three to four feet from him holding the hammer and restraints, made various threats including, “I will take you out.” Mr. Pelosi managed to walk to his bathroom and call 9-1-1, during which he carefully used language to alert the emergency operator to the situation without agitating DePape.
Mr. Pelosi convinced defendant to go downstairs to the first floor and continued talking to DePape. When the police arrived, Mr. Pelosi opened the door and the police ordered DePape to drop the hammer he was holding. Instead, DePape struck Mr. Pelosi three times with full force, fracturing his skull. The responding officers immediately tackled Depape and took him into custody.
On November 9, 2022, a federal grand jury indicted DePape, charging him with one count of assault upon an immediate family member of a United States official with the intent to impede, intimidate, or interfere with the official while engaged in the performance of official duties or with intent retaliate against the official on account of the performance of official duties, and one count of attempted kidnapping of a United States official on account of the performance of official duties. The jury convicted DePape of both charges.
Judge Corley scheduled a status conference for December 13, 2022, at 10 a.m. The assault charge carries a maximum sentence of 30 years in prison and the attempted kidnapping charge carries a maximum sentence of 20 years in prison. 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.
The National Security and Cyber Section of the U.S. Attorney’s Office for the Northern District of California is prosecuting the case. FBI San Francisco, the U.S. Capitol Police, and the San Francisco Police Department are investigating the case.
Former San Francisco Venture Capitalist Convicted of Multiple Fraud and Money Laundering ChargesRead the Press Release
OAKLAND – Michael Brent Rothenberg, a former San Francisco venture capitalist once described in Bloomberg as “Silicon Valley’s Party Animal,” was convicted today of wire fraud, money laundering, bank fraud, and making false statements to a bank by a federal jury, announced Criminal Division Chief Thomas C. Colthurst, Federal Bureau of Investigation Special Agent in Charge Robert Tripp, and Acting Special Agent in Charge of Internal Revenue Service- Criminal Investigation Mark Silva. The guilty verdicts followed a seven-week jury trial before the Hon. Jon S. Tigar, U.S. District Judge. All told, the evidence introduced at trial established that Rothenberg’s schemes resulted in approximately $18.8 million in missing money.
The jury found that Rothenberg, 39, committed wire fraud with respect to a number of investments from investors in two of the venture capital funds that he managed in 2015 and 2016. In addition, the jury found that Rothenberg committed wire fraud in February 2016 with respect to a $2 million investment made in a company he owned named Bend Reality LLC (which did business as River Studios), and that he thereafter committed money laundering by transferring a large portion of those proceeds through various bank accounts. Finally, the jury found the defendant guilty of committing bank fraud and making false statements to a bank in relation to a line of credit that Rothenberg obtained for his venture capital management company from Silicon Valley Bank in late 2015.
Evidence at trial showed that Rothenberg founded a venture capital management company, Rothenberg Ventures Management Company, LLC (“RVMC”), that he used between 2012 and 2018 to raise and manage four annual venture capital funds. The purpose of the funds was to invest in Silicon Valley start-up companies, and particularly companies in the field of virtual reality technologies. The evidence also showed that in approximately 2015, Rothenberg founded River Studios for the purpose of producing content to be used in virtual reality headsets. The evidence presented at trial showed that, throughout 2015 and 2016, Rothenberg told his employees, fund investors, and the investor into River Studios that River Studios had been “self-funded” by him and that no venture capital funds had been used to fund the operations of that company. The evidence showed, however, that Rothenberg misappropriated a large amount of venture capital fund money to pay for River Studios’ operations during that period. In addition to using venture capital funds to pay for River Studios’ operations, the evidence also showed that Rothenberg routinely took excess fees from the venture capital funds that he managed throughout 2015 and 2016 and that investors’ funds were routinely used for purposes other than as represented to fund investors, such as to pay for RVMC’s operating expenses and to secure a line of credit taken out from Silicon Valley Bank by RVMC in late 2015.
In addition to defrauding investors in two of the venture capital funds that he managed, the jury also found Rothenberg guilty of defrauding an investor with respect to a $2 million investment that the investor made into River Studios in February 2016. The evidence at trial showed that Rothenberg falsely told that investor that he had “self-funded” River Studios and that he falsely told that investor that its investment would be used for particular purposes, when, in fact, Rothenberg knew that he needed a large portion of that investor’s investment to pay back money he had misappropriated at the end of 2015 from two of the venture capital funds that he managed. The evidence showed that those repayments, in addition to other transactions, constituted instances of money laundering.
With respect to the line of credit RVMC obtained from Silicon Valley Bank, the evidence at trial showed that, because of the excess money he took from one of the venture capital funds, Rothenberg faced a shortfall at the end of 2015 that he did not wish to report to his investors. The evidence presented at trial showed that, accordingly, Rothenberg engaged in a scheme to defraud Silicon Valley Bank by making false statements and misrepresentations to the bank to obtain a $4 million line of credit to pay back the fund from which he had taken excess fees.
A federal grand jury indicted Rothenberg in August 2020. He was charged with bank fraud, in violation of 18 U.S.C. § 1344; making false statements to a bank, in violation of 18 U.S.C. § 1014; wire fraud, in violation of 18 U.S.C. § 1343; and money laundering, in violation of 18 U.S.C. § 1957.
Rothenberg is currently on pretrial release pursuant to an unsecured bond. Judge Tigar scheduled Rothenberg’s sentencing hearing for March 1, 2024. The maximum statutory penalty for each count in violation of 18 U.S.C. § 1344 and 18 U.S.C. § 1014 is 30 years of imprisonment and a fine of $1,000,000. The maximum penalty for each count in violation of 18 U.S.C. § 1343 is 20 years of imprisonment and a fine of $250,000. The maximum penalty for each count in violation of 18 U.S.C. § 1957 is 10 years and a fine of $250,000. However, any sentence will 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. Attorneys Kyle F. Waldinger, Nicholas J. Walsh, and Benjamin K. Kleinman are prosecuting the case with the assistance of Beth Margen, Megan Pagaduan, and Isabel Trevizo. The prosecution is the result of a lengthy investigation by the Federal Bureau of Investigation and Internal Revenue Service – Criminal Investigation.
Federal Correctional Officer Sentenced to 96 Months for Sexually Abusing Multiple Female InmatesRead the Press Release
OAKLAND – A former Federal Bureau of Prisons (FBOP) correctional officer was sentenced today to 96 months for sexually abusing multiple female inmates and making false statements while he was a correctional officer at the Federal Correctional Institution (FCI) at Dublin, California.
Andrew Jones, 36, of Clovis, California, pleaded guilty to the charges on Aug. 17. Today’s sentence was handed down by U.S. District Court Judge Yvonne Gonzalez Rogers.
“The egregious sexual abuse that took place at FCI Dublin was disgraceful and tragic, and the Justice Department will not rest until we have eliminated such misconduct from the Federal Bureau of Prisons,” said Deputy Attorney General Lisa O. Monaco. “As the defendant’s guilty plea and today’s sentencing demonstrate, FBOP employees who abuse their positions of authority and assault those in their custody will be held to account.”
“This ongoing investigation has unearthed evidence regarding the criminal activities of numerous employees at the Federal Correctional Institution at Dublin,” said U.S. Attorney Ismail Ramsey for the Northern District of California. “So far, seven correctional officers have been convicted of felony conduct involving sexual abuse of female inmates and an eighth employee has been charged with similar conduct. To be clear, this investigation is not over – correctional officers at FCI Dublin are trusted to secure the safety of inmates at the institution; the Department of Justice will continue to hold accountable any correctional officer who violates that solemn responsibility.”
“Jones participated in a culture of sexual abuse of female inmates at FCI Dublin that included the Warden, the Chaplain, and other employees, and he like them has now been held to account for his heinous acts,” said Inspector General Michael E. Horowitz. “The DOJ Office of the Inspector General will continue to aggressively investigate this type of egregious criminal conduct, and we will do everything within our authority to pursue justice for victims of sexual abuse.”
“The defendant's conduct, sexually abusing inmates and threatening violence to keep them silent, is sick and reprehensible,” said FBI Deputy Director Paul Abbate. “Today’s sentencing comes amid relentless efforts to prevent abuse and misconduct by corrections personnel entrusted with the care and protection of others. The FBI will continue to work with partners to ensure the physical safety and civil rights of all individuals and hold accountable any public servant who abuses a position of trust.”
"Andrew Jones' record of abuse is abhorrent," said FBI San Francisco Division Special Agent in Charge Robert Tripp. "The FBI always stands in support of victims of abuse, and incarcerated individuals are no exception. Our dedication to protecting those who are most venerable is unwavering, and the FBI will continue to investigate allegations of such abuse."
According to his plea agreement, Jones was employed as a correctional officer at FCI Dublin where he supervised prisoners who worked in the Food Services Department. Jones admitted that, between July 2020 and June 2021, while he had supervisory and disciplinary authority over all the female prisoners, he received oral sex from, and/or had sexual intercourse with, three female prisoners who worked for him in the FCI Dublin kitchen. Jones admitted that he sexually abused these prisoners in multiple places near the FCI Dublin kitchen, including a staff bathroom, a warehouse, and a room where kitchen utensils were kept.
In a memorandum filed in connection with Jones’ sentencing, the government argued that Jones “enforced silence and obedience” from the prisoners by using “violence and threats of violence.” The memorandum stated that “intimidation and insults on the one hand, and the flattery on the other, was aimed at cultivating pliant prisoners who Jones could abuse for his own sexual pleasure, while he remained safe in the belief that his misconduct would go unreported.”
In sum, Jones pleaded guilty to six counts of sexual abuse of a ward involving three inmates and one count of false statements to the Justice Department’s Office of Inspector General (DOJ-OIG). In addition to the prison term, Judge Gonzalez Rogers also ordered Jones to serve ten years of supervised release, to begin after the prison term. Judge Gonzalez also scheduled a hearing for February 8, 2024, to consider issues related to restitution.
Jones is one of eight correctional officers to have been charged with federal crimes involving sexual misconduct at FCI Dublin in the past three years and the fourth to have been sentenced. To date, all the recent sentences for FCI Dublin guards convicted of sexual abuse of a ward and/or abusive sexual contact of a prisoner have resulted in sentences that are above the U.S Sentencing Guidelines.
DOJ-OIG and FBI investigated the case.
Assistant U.S. Attorneys Molly K. Priedeman and Andrew Paulson for the Northern District of California prosecuted the cases, with the assistance of Madeline Wachs, Sara Slattery, Christine Tian, Claudia Hyslop, Leeya Kekona, and Kay Konopaske.
FBOP is committed to rooting out misconduct within its ranks and working with law enforcement partners to prosecute violations of federal law. The numerous FBOP employees working diligently to ensure justice for the victims of misconduct are critical to the Department’s reform efforts.
Federal Correctional Officer Sentenced to 96 Months for Sexually Abusing Multiple Female InmatesRead the Press Release
A former Federal Bureau of Prisons (FBOP) correctional officer was sentenced today to 96 months in prison, followed by 10 years of supervised release, for sexually abusing multiple female inmates and making false statements while he was a correctional officer at the Federal Correctional Institution (FCI) in Dublin, California.
Andrew Jones, 36, of Clovis, California, pleaded guilty to the charges on Aug. 17. Today’s sentence was handed down by U.S. District Court Judge Yvonne Gonzalez Rogers.
“The egregious sexual abuse that took place at FCI Dublin was disgraceful and tragic, and the Justice Department will not rest until we have eliminated such misconduct from the Federal Bureau of Prisons,” said Deputy Attorney General Lisa O. Monaco. “As the defendant’s guilty plea and today’s sentencing demonstrate, FBOP employees who abuse their positions of authority and assault those in their custody will be held to account.”
“Jones participated in a culture of sexual abuse of female inmates at FCI Dublin that included the Warden, the Chaplain, and other employees, and he like them has now been held to account for his heinous acts,” said Inspector General Michael E. Horowitz of the Justice Department Office of Inspector General (DOJ-OIG). “The DOJ Office of the Inspector General will continue to aggressively investigate this type of egregious criminal conduct, and we will do everything within our authority to pursue justice for victims of sexual abuse.”
“The defendant's conduct, sexually abusing inmates and threatening violence to keep them silent, is sick and reprehensible,” said FBI Deputy Director Paul Abbate. “Today’s sentencing comes amid relentless efforts to prevent abuse and misconduct by corrections personnel entrusted with the care and protection of others. The FBI will continue to work with partners to ensure the physical safety and civil rights of all individuals and hold accountable any public servant who abuses a position of trust.”
“This ongoing investigation has unearthed evidence regarding the criminal activities of numerous employees at the Federal Correctional Institution at Dublin,” said U.S. Attorney Ismail Ramsey for the Northern District of California. “So far, seven correctional officers have been convicted of felony conduct involving sexual abuse of female inmates and an eighth employee has been charged with similar conduct. To be clear, this investigation is not over – correctional officers at FCI Dublin are trusted to secure the safety of inmates at the institution; the Department of Justice will continue to hold accountable any correctional officer who violates that solemn responsibility.”
According to his plea agreement, Jones was employed as a correctional officer at FCI Dublin where he supervised prisoners who worked in the Food Services Department. Jones admitted that, between July 2020 and June 2021, while he had supervisory and disciplinary authority over all the female prisoners, he received oral sex from, and/or had sexual intercourse with, three female prisoners who worked for him in the FCI Dublin kitchen. Jones admitted that he sexually abused these prisoners in multiple places near the FCI Dublin kitchen, including a staff bathroom, a warehouse, and a room where kitchen utensils were kept.
In a memorandum filed in connection with Jones’ sentencing, the government argued that Jones “enforced silence and obedience” from the prisoners by using “violence and threats of violence.” The memorandum stated that “intimidation and insults on the one hand, and the flattery on the other, was aimed at cultivating pliant prisoners who Jones could abuse for his own sexual pleasure, while he remained safe in the belief that his misconduct would go unreported.”
In sum, Jones pleaded guilty to six counts of sexual abuse of a ward involving three inmates and one count of false statements to the DOJ-OIG.
Jones is one of eight correctional officers to have been charged with federal crimes involving sexual misconduct at FCI Dublin in the past three years and the fourth to have been sentenced. To date, all the recent sentences for FCI Dublin guards convicted of sexual abuse of a ward and/or abusive sexual contact of a prisoner have resulted in sentences that are above the U.S Sentencing Guidelines.
DOJ-OIG and thr FBI investigated the case.
Assistant U.S. Attorneys Molly K. Priedeman and Andrew Paulson for the Northern District of California prosecuted the cases, with the assistance of Madeline Wachs, Sara Slattery, Christine Tian, Claudia Hyslop, Leeya Kekona, and Kay Konopaske.
FBOP is committed to rooting out misconduct within its ranks and working with law enforcement partners to prosecute violations of federal law. The numerous FBOP employees working diligently to ensure justice for the victims of misconduct are critical to the Department’s reform efforts.
San Jose Man Sentenced to Serve over Six Years in Prison for Distributing FentanylRead the Press Release
OAKLAND – Ian Edward Parrish was sentenced to serve 80 months in prison for distributing fentanyl that resulted in the fatal overdose an Ohio resident, announced United States Attorney Ismail J. Ramsey and Federal Bureau of Investigations (FBI) Special Agent in Charge Robert K. Tripp. The sentence was handed down by the Hon. Araceli Martínez-Olguín, United States District Judge.
Parrish, 28, of San Jose, Calif., pleaded guilty to the charge on August 28, 2023. In his plea agreement, Parrish admitted that on August 16, 2022, he sold four loose pills to an individual in a bar in Fremont, Calif. Two of the pills were counterfeit “M30” pills that were blue and had the appearance of “Perc30,” a common prescription pain killer that contains Percocet, a federally controlled substance. Parrish admitted that when the victim asked if the pills were real, he told him that they were. But, contrary to the assurance he gave the victim, Parrish admitted that he did not actually know whether the pills were genuine Percocet. According to the plea agreement, Parrish admitted that the government could prove the pills he sold contained fentanyl. After buying the pills, the victim left the bar and consumed one. Approximately 17 minutes later, the victim began to sway and lose balance, and then lost consciousness. According to the plea agreement, emergency personnel arrived and tried unsuccessfully to resuscitate the victim; the victim was pronounced dead at the scene. In the plea agreement, Parrish admitted that the cause of the victim’s death was the pill the victim consumed and that Parrish sold to him.
According to the government’s sentencing memorandum, the victim left behind a spouse, as well as 6 children and 11 grandchildren.
On August 22, 2023, Parrish was charged by Information with distributing the fentanyl, in violation of 21 U.S.C. 841(a)(1), (b)(1)(C). He pleaded guilty to the charge.
In addition to the 80-month federal prison sentence, Judge Martínez-Olguín ordered Parrish to serve three years of supervision following his release from federal prison. Parrish was remanded to federal custody after the sentencing hearing and began serving his prison sentence immediately.
The case was prosecuted by Assistant U.S. Attorney Evan M. Mateer with the assistance of Isabel Trevizo and Jessie Chelsea. The prosecution is the result of an investigation by FBI and the Fremont Police Department.
One Pill Can Kill: Beware of pills bought on the street: One Pill Can Kill. Fentanyl, a Schedule II controlled substance, is a highly potent opiate that can be diluted with cutting agents to create counterfeit pills that purport to mimic the effects of Oxycodone, Percocet, and other drugs, but can be obtained at a lower cost. However, very small variations in the amount or quality of fentanyl create huge effects on the potency of the counterfeit pills and can easily cause death. Fentanyl has now become the leading cause of drug overdose deaths in the United States. Counterfeit, fentanyl-laced pills are usually shaped and colored to resemble pills that are sold legitimately at pharmacies.
Former San Jose State University Director of Sports Medicine Sentenced for Sexually Abusing Female Student AthletesRead the Press Release
A former San Jose State University (SJSU) Director of Sports Medicine was sentenced today in the Northern District of California to 24 months in prison, one year of supervised release, a $15,000 fine and restitution to be determined at a later date for sexually abusing female student-athletes under the guise of providing medical treatment.
As part of the plea agreement, Scott Shaw admitted that, between 2017 and 2020, he violated the civil rights of four students who played on women’s athletics teams by touching their breasts and buttocks without their consent and without a legitimate medical purpose.
“This sentence should send a clear message that public school officials who exploit their positions of authority to sexually abuse and harass students will face serious consequences for their actions,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “The Justice Department will not tolerate violations of civil rights committed under the guise of legitimate medical treatment by those in positions of power and trust.”
“Scott Shaw was entrusted to care for athletes in the California State University system,” said First Assistant U.S. Attorney Patrick Robbins for the Northern District of California. “Instead, he used his power over female athletes to violate their civil rights by sexually groping them without their consent and without any medical justification. Such criminal assaults on college athletes will be investigated and prosecuted; anyone abusing their power over student athletes in this way should expect to spend time in prison for doing so.”
“A patient necessarily places enormous trust in a healthcare provider; that relationship is privileged and inviolable for good reason,” said Special Agent In Charge Robert Tripp of the FBI San Francisco Field Office. “Shaw’s violation of that relationship is reprehensible, as was reflected in his sentence. I commend the student athletes for their moral courage in coming forward to challenge Shaw. Their bravery prevented Shaw from committing further harm to others, and civil rights violations will continue to be a top priority for the FBI.”
According to court documents, from 2008 until August 2020, Shaw served as the Director of Sports Medicine and head athletic trainer at SJSU, a public university that is part of the California State University system, and was an employee of the State of California. His duties included treating injuries sustained by student-athletes at SJSU.
Additionally, Shaw admitted that he engaged in all the conduct described above on SJSU’s campus, and in his capacity as an SJSU athletic trainer, and the student-athletes only allowed him to have physical contact with them because of his status as an SJSU athletic trainer. Shaw also admitted that he touched each of the student-athletes as described above without any legitimate diagnostic or treatment purpose and without seeking or securing their consent in advance. Shaw further admitted that his conduct was not the result of mistake, carelessness or accident.
The FBI San Francisco Field Office investigated the case.
Assistant U.S. Attorney Michael Pitman for the Northern District of California and Trial Attorney MarLa Duncan and Attorney Advisor Sarah Howard of the Civil Rights Division’s Criminal Section are prosecuting the case.
Former San Jose State University Director of Sports Medicine Sentenced for Groping Female Student AthletesRead the Press Release
SAN JOSE – Scott Shaw, a former San Jose State University (SJSU) Director of Sports Medicine, was sentenced today to serve 24 months in prison for unlawfully touching female student-athletes under the guise of providing medical treatment. The sentence was handed down by the Honorable Beth Labson Freeman, United States District Judge for the Northern District of California.
“Today’s sentence sends a clear message that public school officials who exploit their positions of authority to sexually abuse and harass students will face serious consequences for their actions,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “The Justice Department will not tolerate violations of civil rights committed under the guise of legitimate medical treatment by those in positions of power and trust.”
“Scott Shaw was entrusted to care for athletes in the California State University system. Instead, he used his power over female athletes to violate their civil rights by sexually groping them without their consent and without any medical justification,” said First Assistant U.S. Attorney Patrick Robbins for the Northern District of California. “Such criminal assaults on college athletes will be investigated and prosecuted; anyone abusing their power over student athletes in this way should expect to spend time in prison for doing so.”
“A patient necessarily places enormous trust in a healthcare provider; that relationship is privileged and inviolable for good reason,” said FBI Special Agent In Charge Robert Tripp. “Shaw’s violation of that relationship is reprehensible, as was reflected in his sentence. I commend the student athletes for their moral courage in coming forward to challenge Shaw. Their bravery prevented Shaw from committing further harm to others, and civil rights violations will continue to be a top priority for the FBI.”
Shaw pleaded guilty to the charges on August 15, 2023. As part of the plea agreement, Shaw admitted that, between 2017 and 2020, he violated the civil rights of four students who played on women’s athletics teams by touching their breasts and buttocks without their consent and without a legitimate medical purpose.
According to court documents, from 2008 until August 2020, Shaw served as the Director of Sports Medicine and head athletic trainer at SJSU, a public university that is part of the California State University system, and was an employee of the State of California. His duties included treating injuries sustained by student-athletes at SJSU.
Shaw admitted that he engaged in all the conduct described above on SJSU’s campus, and in his capacity as an SJSU athletic trainer. Shaw admitted that female student-athletes allowed him to have physical contact with them only because of his status as an SJSU athletic trainer. Shaw further acknowledged that female student-athletes sought treatment from him because they were in pain, seeking relief, and wanted to continue participating in SJSU Athletics. Further, the student-athletes trusted him because he was an experienced athletic trainer. Shaw also admitted that he inappropriately touched each of the student-athletes as described above without any legitimate diagnostic or treatment purpose and without seeking or securing their consent in advance. Shaw further admitted that his conduct was not the result of mistake, carelessness, or accident.
In sum, Shaw pleaded guilty to two counts of deprivation of rights under color of law, in violation of 18 U.S.C. 242. In addition to the prison term, Judge Freeman ordered Shaw to serve one year of supervised release, to begin after he has served his prison term, and to pay a $15,000 fine. Judge Freeman also scheduled a hearing to take place on February 6, 2024, to determine issues related to restitution.
Judge Freeman ordered Shaw to surrender on or before March 6, 2024, to begin serving his prison term. Assistant U.S. Attorney Michael Pitman for the Northern District of California and Trial Attorney MarLa Duncan and Attorney Advisor Sarah Howard of the Civil Rights Division’s Criminal Section are prosecuting the case. This case was investigated by the FBI.
Three Construction Planning Firm Executives Charged with Bribing San Francisco Dept. of Building Inspection EmployeesRead the Press Release
SAN FRANCISCO – Three former executives of a San Francisco based construction planning and design firm were charged today paying bribes to employees of the San Francisco Department of Building Inspection (”DBI”), announced the Chief of the Criminal Division of the Office for the U.S. Attorney Thomas A. Colthurst and Federal Bureau of Investigation Special Agent in Charge Robert Tripp.
Siavash “Sia” Tahbazof, 72, was charged in an Information filed today with one count of conspiracy to commit honest services wire fraud for paying bribes to DBI employees in return for their agreement to expedite and issue building plan permits and approve building inspections, beginning in 2003. According to the Information, Tahbazof conspired to bribe city employees including former DBI plan checkers Cyril Yu and Rodolfo “Rudy” Pada, and DBI building inspector Bernard Curran.
In a separate information also filed today, Reza Khoshnevisan, 54, was charged with one count of conspiracy to commit honest services wire fraud for paying bribes to Pada and Yu in return for their agreement to expedite and issue building plan permits. The conspiracy allegedly began in 2012.
In addition, Bahman Ghassemzadeh, 38, was charged in a third Information filed today. Ghassemzadeh is charged with one count of conspiracy to commit honest services wire fraud for paying bribes to Pada, Yu, and Curran, beginning in 2014, in return for their agreement to expedite and issue building plan permits and approve building inspections.
DBI is a regulatory city agency in San Francisco responsible for overseeing enforcement of building, electrical, plumbing, and housing codes for the City of San Francisco’s more than 200,000 commercial and residential buildings. Contractors and builders submit construction plans to DBI for approval and permitting; the plans are required to be reviewed and approved by DBI to insure that the proposed construction and building meets city codes and regulations.
An Information merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. The defendants were each charged with one count of conspiracy to commit honest services wire fraud in violation of 18 U.S.C. § 1349. If convicted, each defendant faces a maximum sentence of twenty years imprisonment, and a fine of up to $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.
Pada, 68, and Yu, 41, have both already been charged in separate Informations with conspiracy to commit honest services wire fraud. The Informations, filed on November 3, 2023, allege Pada accepted bribes in return for expediting and approving permits for building and construction plans and allege that Yu accepted bribes in return for approving permits for construction and building plans.
Assistant U.S. Attorneys David Ward and Casey Boome are prosecuting the case. The prosecution is the result of an investigation by the Federal Bureau of Investigation.
Four Bay Area Real Estate Professionals Charged in Years-Long Mortgage Fraud SchemeRead the Press Release
SAN FRANCISCO - A federal grand jury has indicted Tjoman Buditaslim (a/k/a “Joe Lim”), Travis Holasek, Jose Alfonso Tellez, and Jose De Jesus Martinez, with conspiracy to commit wire fraud, wire fraud, and aggravated identity theft in connection with a years-long mortgage fraud scheme, announced United States Attorney Ismael J. Ramsey and Special Agent in Charge Herminia Neblina of the Federal Housing Finance Agency – Office of Inspector General.
According to the indictment, filed November 7, 2023, and unsealed yesterday, between May 2019 and August 23, 2023, Buditaslim, 51; Holasek, 51; Tellez, 26; and Martinez, 58, obtained more than $55 million in residential mortgage loans for home buyers in northern California by creating fraudulent documents that they submitted to residential mortgage origination companies. The fraudulent documents were used to qualify buyers for residential mortgage loans in connection with the fraud scheme. The defendants profited from the alleged mortgage fraud scheme by taking loan origination commissions, real estate broker commission payments from escrow, and direct payments from potential buyers who wrote checks directly to the defendants for submitting loan applications to mortgage origination companies on their behalf.
The indictment describes numerous details of the alleged scheme. For example, the indictment alleges that the defendants carried out their mortgage fraud scheme by assisting potential buyers with locating residential properties to purchase, creating false divorce decree documents and child support checks purportedly payable to the potential buyer from an individual the buyer had never been married to or even met, creating false and fabricated bank statements showing falsely inflated bank account balances for potential buyers, submitting loan applications containing materially false information about buyers’ income to a mortgage origination company, and collecting proceeds of home sales by directing payments from escrow to defendants and their associates.
As alleged in the indictment, the defendants did not inform the potential buyers that the fraudulent documents—including divorce papers, child support checks, and bank statements— were being fabricated. The defendants knew that based on the buyers’ true income and bank statement balances, the potential buyers would not have qualified for the mortgages for which the defendants applied. The indictment also describes how defendants also allegedly prepared and assisted in preparing false Uniform Residential Loan Applications (URLAs) for potential buyers. The URLAs contained false information about the loan applicants’ income and assets. Further, the loan application packages the defendants submitted also allegedly contained false and fabricated supporting documentation, including altered bank statements, fabricated divorce documents, and fabricated child support checks.
As a result of the alleged fraud scheme, a mortgage origination company (identified in the indictment as Mortgage Origination Company 1) was required to repurchase loans originated as a result of fraud that had been sold to a federally-chartered home mortgage purchaser, causing losses to the company of approximately $8,162,515.82.
Buditaslim was arrested on August 23, 2023, in Daly City, California, pursuant to a criminal complaint. He made his initial appearance in U.S. District Court for the Northern District of California on August 24, 2023. Martinez was arrested on November 7, 2023, and made his initial appearance in federal court on November 8, 2023. Tellez made his initial appearance in federal court on November 8, 2023. An initial appearance in federal court in San Francisco has not yet been scheduled for Holasek.
In sum, the Indictment charges each defendant with the following offenses:
Count(s) Defendants Charge 1 Tjoman Buditaslim (a/k/a “Joe Lim”)
Travis Holasek
Jose Alfonso Tellez
Jose De Jesus Martinez 18 U.S.C. § 1349 – Conspiracy to Commit Wire Fraud 2-3 Tjoman Buditaslim (a/k/a “Joe Lim”)
Travis Holasek
Jose Alfonso Tellez
Jose De Jesus Martinez 18 U.S.C. § 1343 – Wire Fraud 4-5 Tjoman Buditaslim (a/k/a “Joe Lim”)
Travis Holasek
Jose Alfonso Tellez 18 U.S.C. § 1343 – Wire Fraud 6 Tjoman Buditaslim (a/k/a “Joe Lim”)
Jose Alfonso Tellez
Jose De Jesus Martinez 18 U.S.C. § 1343 – Wire Fraud 7 Tjoman Buditaslim (a/k/a “Joe Lim”) 18 U.S.C. § 1028A(a)(1) – Aggravated Identity Theft 8 Travis Holasek 18 U.S.C. § 1028A(a)(1) – Aggravated Identity Theft 9 Jose De Jesus Martinez 18 U.S.C. § 1028A(a)(1) – Aggravated Identity TheftAn 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 a maximum sentence of 20 years in prison, and a fine of $250,000, plus restitution if appropriate, for each violation of 18 U.S.C. §§ 1343 and 1349, as well as a mandatory sentence of two years in prison for each violation of 18 U.S.C. § 1028A. 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 case is being prosecuted by Assistant U.S. Attorneys Christiaan Highsmith and Emily Dahlke with the assistance of Aarian Beiti. The prosecution is the result of an investigation by the Federal Housing Finance Agency – Office of Inspector General, U.S. Postal Inspection Service, U.S. Department of Housing and Urban Development – Office of Inspector General, and the California Department of Justice.
Engineer Indicted for Bombing Energy Facilities in CaliforniaRead the Press Release
SAN JOSE – Peter Karasev, 36, a U.S. citizen residing in San Jose, was arraigned in the Northern District of California today on an indictment charging him with destroying energy facilities and using fire or explosives to commit a federal crime. Karasev made his appearance today before United States Magistrate Judge Virginia K. DeMarchi.
According to court documents, Karasev was indicted on Oct. 19. As alleged in counts one and two of the indictment, Karasev knowingly and willfully damaged the property of two energy facilities – specifically, two PG&E transformers in San Jose, California on Dec. 8, 2022, and Jan. 5, 2023, respectively – and attempted to cause and caused significant interruption and impairment of those energy facilities. The indictment also alleges, in count three, that the defendant used fire and an explosive to commit a felony, specifically, the destruction of an energy facility on Jan. 5, 2023.
“These charges make clear that those who attack our country’s critical infrastructure will be met with the full force of the Justice Department,” said Attorney General Merrick B. Garland. “We have charged Peter Karasev with bombing two energy transformers in Northern California, leaving more than 1,500 households and businesses in the San Jose community without power. I want to thank the U.S. Attorney’s Office for Northern District of California and the FBI for their work to bring the defendant to justice and prevent further harm to the San Jose community.”
“The defendant in this case allegedly used explosives to try to cut off electricity to more than 1,500 San Jose businesses and residences,” said U.S. Attorney Ismail J. Ramsey. “Damaging our region’s critical infrastructure endangers innocent victims—including our most vulnerable citizens such as the elderly and the sick—and we will not tolerate it. We will vigorously prosecute any malicious attempts to disrupt the power grid.”
“Attacks and threats against neighborhood energy facilities with explosives are more than alarming. The FBI and our partners will not tolerate criminal activity that puts the safety of our citizens at risk,” said FBI Special Agent in Charge Robert K. Tripp. “I commend the San Jose Police Department for their swift action in identifying and apprehending Karasev. Their excellent detective work prevented further harm to our community.”
As described in a government memorandum seeking Karasev’s pretrial detention, Karasev constructed, planted and ignited the explosive devices that caused each of the transformer explosions. Both attacks occurred during the early morning hours in commercial areas occupied by stores and businesses, and collectively terminated power to over 1,500 households and businesses in the San Jose community.
The government’s memorandum also detailed that in the months leading up to the attacks, Karasev was building and experimenting with homemade explosives, as well as manufacturing methamphetamine, in his own home. At the time of his arrest, Karasev was allegedly in possession of a range of improvised explosive devices in varying stages of completion, as well as multiple firearms, additional weapons, over 300 pounds of explosive precursor materials, and other hazardous substances.
Karasev was arrested in March 2023 by the San Jose Police Departement and remained in custody on related state charges prior to his transfer to federal custody for this case. A federal grand jury charged Karasev with two counts of destruction of an energy facility and one count of use of fire or an explosive to commit a federal felony. If convicted, Karasev faces a mandatory minimum penalty of 10 years in prison on the third count to be served consecutively to any imprisonment imposed for either of the other counts. Karasev faces a maximum penalty of up to 20 years in prison, a $250,000 fine, and three years of supervised release for each count. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Karasev was ordered detained pending his next federal court appearance. His next appearance is scheduled to take place on January 30, 2024, before Hon. Beth Labson Freeman, United States District Judge.
This case is being investigated by the FBI and the San Jose Police Department.
Assistant U.S. Attorney Anne C. Hsieh for the Northern District of California and Trial Attorney Jacob Warren of the National Security Division’s Counterterrorism Section are prosecuting the case.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
cr_23-00364-blf-01_indictment.pdfJustice Department Secures ADA Agreement with California County to Improve Mental Health ServicesRead the Press Release
The Justice Department announced today that it has filed a motion to intervene in Disability Rights California v. Alameda County and a proposed settlement agreement with Alameda County, California, and private plaintiffs to resolve allegations that the county violates Title II of the Americans with Disabilities Act (ADA) in its provision of mental health services.
Specifically, the proposed settlement agreement would resolve the department’s findings that Alameda County fails to provide services to qualified individuals with mental health disabilities in the most integrated setting appropriate to their needs. Instead, the department found that the county places too many people with mental illness into institutions such as John George Psychiatric Hospital and other facilities. In Olmstead v. L.C., the U.S. Supreme Court held that Title II of the ADA requires public entities, in providing services to persons with disabilities, to do so in their homes and communities when appropriate services can reasonably be provided in those settings to individuals who want them.
“It’s time to bring an end to the unnecessary incarceration and over-institutionalization of people with mental health disabilities in our country,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “People with mental health disabilities have the right to live in their own homes and communities with services that are effective in supporting their recovery instead of being relegated to repeated hospitalization and avoidable involvement with the criminal justice system. This agreement reaffirms the Justice Department’s commitment to ensuring that people with mental illness can access the care they need free from unnecessary barriers.”
The proposed settlement agreement requires the county to provide timely mobile crisis response services throughout the county and intensive mental health, housing, and employment services. The agreement addresses planning for people being discharged from psychiatric facilities and the Santa Rita Jail to help strengthen connections to critical mental health services. The proposed settlement also requires the county to reach out and engage proactively with people who have serious mental illness.
The department appreciates the collaboration with plaintiffs’ counsel from Disability Rights California, Bazelon Center for Mental Health Law, Disability Rights Education and Defense Fund and Goldstein, Borgen, Dardarian & Ho. The department recognizes Alameda County for its commitment to compliance with the ADA.
Additional information about the Civil Rights Division is available on its website at www.justice.gov/crt.
Members of the public may report possible civil right violations at www.civilrights.justice.gov.
View the filing here.
Engineer Indicted for Bombing Energy Facilities in CaliforniaRead the Press Release
Peter Karasev, 36, a U.S. citizen residing in San Jose, was arraigned in the Northern District of California today on an indictment charging him with destroying energy facilities and using fire or explosives to commit a federal crime.
According to court documents, Karasev was indicted on Oct. 19. As alleged in counts one and two of the indictment, Karasev knowingly and willfully damaged the property of two energy facilities – specifically, two PG&E transformers in San Jose, California on Dec. 8, 2022, and Jan. 5, 2023, respectively – and attempted to cause and caused significant interruption and impairment of those energy facilities. The indictment also alleges, in count three, that the defendant used fire and an explosive to commit a felony, specifically, the destruction of an energy facility on Jan. 5, 2023.
“These charges make clear that those who attack our country’s critical infrastructure will be met with the full force of the Justice Department,” said Attorney General Merrick B. Garland. “We have charged Peter Karasev with bombing two energy transformers in Northern California, leaving more than 1,500 households and businesses in the San Jose community without power. I want to thank the U.S. Attorney’s Office for Northern District of California and the FBI for their work to bring the defendant to justice and prevent further harm to the San Jose community.”
"The indictment alleges that Karasev built explosive devices and used them to damage energy facilities, knocking out power to over 1,500 homes and businesses in the San Jose area,” said FBI Director Christopher Wray. “The FBI is laser focused on protecting the essential infrastructure that Americans rely on every day, and we and our partners like the San Jose Police Department will use every lawful means to hold anyone who targets that infrastructure accountable.”
“The defendant in this case allegedly used explosives to try to cut off electricity to more than 1,500 San Jose businesses and residences,” said U.S. Attorney Ismail J. Ramsey for the Northern District of California. “Damaging our region’s critical infrastructure endangers innocent victims – including our most vulnerable citizens such as the elderly and the sick – and we will not tolerate it. We will vigorously prosecute any malicious attempts to disrupt the power grid.”
As described in a government memorandum seeking Karasev’s pretrial detention, Karasev constructed, planted and ignited the explosive devices that caused each of the transformer explosions. Both attacks occurred during the early morning hours in commercial areas occupied by stores and businesses, and collectively terminated power to over 1,500 households and businesses in the San Jose community.
The government’s memorandum also detailed that in the months leading up to the attacks, Karasev was building and experimenting with homemade explosives, as well as manufacturing methamphetamine, in his own home. At the time of his arrest, Karasev was allegedly in possession of a range of improvised explosive devices in varying stages of completion, as well as multiple firearms, additional weapons, over 300 pounds of explosive precursor materials, and other hazardous substances.
Karasev was arrested in March 2023 by local authorities and remained in custody on related state charges prior to his transfer to federal custody for this case. He is charged with two counts of destruction of an energy facility and one count of use of fire or an explosive to commit a federal felony. If convicted, Karasev faces a mandatory minimum penalty of 10 years in prison on count three to be served consecutively to any imprisonment imposed for either of the other counts. Karasev faces a maximum penalty of up to 20 years in prison, a $250,000 fine, and three years of supervised release for each count. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The FBI and the San Jose Police Department are investigating the case.
Assistant U.S. Attorney Anne C. Hsieh for the Northern District of California and Trial Attorney Jacob Warren of the National Security Division’s Counterterrorism Section are prosecuting the case.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Two Former San Francisco Department of Building Inspection Engineers Charged with Honest Services Fraud ConspiracyRead the Press Release
SAN FRANCISCO - Two former San Francisco Department of Building Inspection (DBI) construction plan engineers have been charged in federal court with participating in an honest services wire fraud conspiracy for accepting bribes in return for expediting and approving building and construction plan permits, announced Attorney for the United States Thomas A. Colthurst and Federal Bureau of Investigation (FBI) Special Agent in Charge Robert K. Tripp.
According to a criminal Information filed on November 2, 2023, Rodolfo “Rudy” Pada, 68, of Millbrae, California, began accepting bribes in 2003 and continued to do so until he retired in September 2017. The Information alleges the bribes consisted of cash, free meals, drinks, and other benefits bestowed upon Pada by executives at a construction planning and design firm in return for Pada expediting and approving permits for building and construction plans. In addition, Pada is alleged to have solicited, accepted, and concealed an interest-free $85,000 loan facilitated by a construction planning and design firm executive.
According to a separate Information filed on November 2, 2023, Cyril Yu, 41, of San Francisco, began accepting bribes in January 2018 and continued to do so until February 2021. The Information alleges the bribes consisted of cash, free meals, drinks, and other benefits bestowed upon Yu by executives at a construction planning and design firm in return for Yu expediting and approving permits for building and construction plans.
The Informations allege that DBI is a regulatory agency in the City and County of San Francisco responsible for overseeing enforcement of building, electrical, plumbing, and housing codes for San Francisco’s more than 200,000 commercial and residential buildings. According to the Informations, contractors and builders submit construction plans to DBI for approval and permitting; the plans must be reviewed and approved by DBI to ensure that proposed construction plans meet City codes and regulations.
An information merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. Pada and Yu were each charged with one count of conspiracy to commit honest services wire fraud in violation of 18 U.S.C. § 1349. If convicted, each defendant faces a maximum sentence of 20 years imprisonment, and a fine of up to $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.
The case is being prosecuted by the Corporate and Securities Fraud Section of the United States Attorney’s Office. Assistant U.S. Attorneys David Ward and Ilham Hosseini are prosecuting the case, which is the result of an investigation by the FBI
U.S. Attorney and Federal Law Enforcement Officials Assemble with State Law Enforcement Officers and Local Dignitaries in Show of Unity Against Fentanyl Trafficking in the Tenderloin District of San FranciscoRead the Press Release
SAN FRANCISCO – U.S. Attorney Ismail J. Ramsey convened a press conference today bringing together numerous federal, state, and local law enforcement authorities to announce “All Hands on Deck,” a law enforcement initiative to address what has become endemic drug dealing in the Tenderloin District of San Francisco. U.S. Attorney Ramsey explained that the new joint initiative, focused on the Tenderloin, is designed to change the basic cost/benefit analysis for fentanyl dealers throughout the Northern District of California.
Representing several state and local entities were notables including San Francisco Mayor London Breed, San Francisco District Attorney Brooke Jenkins, Chief of the San Francisco Police Department (SFPD) William Scott, San Francisco Sheriff Paul Miyamoto, Commander Sunshine Garside of the California Highway Patrol, and Deputy Chief of the Bay Area Rapid Transit Police Chris Vogan. They were joined on stage by federal law enforcement personnel: Brian Clark of the Drug Enforcement Administration; Robert Tripp of the Federal Bureau of Investigation; Jennifer Cicolani of the Bureau of Alcohol, Tobacco, Firearms, and Explosives; Tatum King of Homeland Security Investigations; and Shawn Bradstreet of the U.S. Secret Service, as well as Acting U.S. Marshal Jay Bieber, Executive Director of the Northern California High Intensity Drug Trafficking Area (HIDTA) Mike Sena, U.S. Postal Inspector in Charge Rafael Nunez, and Internal Revenue Service– Criminal Investigation Supervisory Special Agent Steve Martins.
Although All Hands on Deck focuses on drug dealing in the Tenderloin, several of the elements have reach outside of the San Francisco neighborhood and throughout the Northern District of California. Elements of the initiative include the following:
• ramping up arrests of street dealers and suppliers of fentanyl who sell fentanyl near federal buildings (including near the James R. Browning U.S. Courthouse at 7th and Mission Streets, the Nancy Pelosi Federal Building on 7th and Mission Streets, and the Phillip Burton Federal Building and U.S. Courthouse at 450 Golden Gate Avenue);
• expanding efforts to track down and hold accountable suppliers of fentanyl;
• bringing additional charges against persons operating money services operations who turn a blind eye to drug trafficking and money laundering transactions on their networks;
• using targeted wiretaps, arrests, and searches throughout the Bay Area to enable drug seizures and to stem the flow of drugs and dealers coming into San Francisco from nearby counties;
• conducting regular joint federal and SFPD “jump out” operations in the Tenderloin to make on-the-spot arrests for open-air drug dealing;
• “fast-tracking” certain federal cases so that they take as little as a month from time of arrest to disposition; and
• federal “adoption” of state cases to raise the stakes by holding drug dealers accountable in the federal system.U.S. Attorney Ramsey stated that “our drug crisis has been fueled in part because selling fentanyl has become a lucrative vocation for people who have found our neighborhoods, and principally the Tenderloin District, to be a convenient and risk-free marketplace.” The U.S. Attorney disclosed that several of the participants at the press conference have been coordinating closely for months to disrupt fentanyl distribution in San Francisco and to remove fentanyl dealers from San Francisco neighborhoods. The result, U.S Attorney stated, has been an increase in collaboration, cooperation, and coordination between all the participants at the press conference. “All Hands on Deck,” said U.S. Attorney Ramsey, “is designed to change the basic cost/benefit analysis for fentanyl dealers. Today’s message is simple: selling fentanyl in the Tenderloin will result in your arrest and prosecution.”
“The Tenderloin has become ground zero for drug tourism. On average, we lose three lives a day to drug poisoning from sales connected to this area,” said DEA Special Agent in Charge Brian Clark. “The community has said, loud and clear, that they are sick and tired of the death and destruction caused by this lawlessness. As leaders in law enforcement, I can tell you we are working tirelessly to hold accountable the people responsible for this devastation.”
“We’ve seen an increased and significant presence from federal law enforcement taking on drug enforcement,” said Mayor Breed, “and we greatly appreciate their partnership in this city. I want to thank the U.S. Attorney and his team and the DEA for dedicating resources to disrupting the flow of drugs on our streets and for their commitment to San Francisco. Their work, along with our state and local law enforcement, is having an impact on our streets.”
“Law enforcement approaches traditionally applied to drug dealing in our neighborhoods simply have not caught up the challenges presented by this new drug,” stated U.S. Attorney Ramsey. “Yet, the tools of law enforcement can address some of the root causes of this epidemic. We in law enforcement are determined to double-down, triple-down, and take all necessary steps to prevent this poison from reaching our streets.”
“Current conditions on our streets are completely unacceptable and require all levels of government to work together to close open-air drug markets and hold suspected drug dealers accountable for the unprecedented death and addiction that their trade has wrought on our city,” said District Attorney Brooke Jenkins. “I would like to thank Speaker Emerita Nancy Pelosi for her steadfast leadership and tireless advocacy on behalf of San Franciscans, which accelerated the federal government’s approval of San Francisco for Operation Overdrive. Working together with our partners in the U.S. Attorney’s Office, these federal law enforcement agencies, as well as state and local law enforcement agencies, we will be more able to identify, arrest and prosecute suspected drug traffickers at all levels. Every legal resource available to us must be used to deter and disrupt the flagrant drug trafficking in our community.”
“The SFPD will not tolerate people dealing drugs on our streets, and we will hold these dealers accountable, and sustain the effort over time,” Chief Bill Scott said. “I want to thank our federal partners and our officers for their hard work in helping make our beautiful city safe for everyone to enjoy.”
The participants at the press conference stressed that a new reality for San Francisco drug dealers exists and that the consequences for dealing drugs in the Tenderloin are changing. The chances of getting caught have increased and any hope for profits must now be weighed against unacceptable losses in time, money, seized drugs, and other disruptions that criminal convictions present. Over the past four months, nearly 50 kilograms of fentanyl were removed from the streets in the Tenderloin, nearly double the amount taken off the streets in the same area during the same period last year. Similarly, 12 kilograms of methamphetamine were seized in the last four months—a 169% increase from the same period last year.
Information shared at the press conference made clear that greater resources from each of the represented law enforcement partners are being deployed. U.S. Attorney Ramsey pledged that every criminal Assistant United States Attorney in the Northern District of California will be involved in this fight in one way or another. In addition, the DEA described how additional resources are being contributed through Operation Overdrive, and Mayor Breed, Chief Scott, and DA Jenkins all described devoting additional resources to respond to the fentanyl crisis. As stated by U.S. Attorney Ramsey, “‘All Hands on Deck’ means we are using our resources in a way that addresses the magnitude of the problem that fentanyl presents.”