Southern District of California

A drug trafficker and money launderer for the Sinaloa Cartel was sentenced yesterday to 188 months in prison for supervising the smuggling of multi-kilogram quantities of cocaine, methamphetamine, and heroin from Mexico into the United States and the smuggling of drug proceeds from the United States to Mexico.  

Roberto Gallegos-Lechuga, 39, of Sinaloa, Mexico, was extradited from Mexico to the United States in March 2020. In July 2021, he pleaded guilty to conspiracy to commit international money laundering. According to court documents, Gallegos-Lechuga coordinated the smuggling of large quantities of illegal narcotics through ports of entry in Southern California. Gallegos-Lechuga also supervised and managed couriers who smuggled hundreds of thousands of dollars in cash at a time, from the illegal sale of drugs, from the United States to Mexico as part of the cartel’s ongoing efforts to promote drug trafficking.

“This defendant was part of a violent transnational criminal organization that posed a danger to our communities,” said Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division. “We will prosecute to the fullest extent of the law those who export dangerous narcotics to the United States and finance those activities through money laundering. I want to thank the Government of Mexico for extraditing Gallegos-Lechuga to the United States. Through such partnerships, we will continue to work to dismantle dangerous drug cartels.”

“Those who manage drug trafficking and money laundering efforts for the Sinaloa cartel, one of the most violent criminal organization in the world, will continue to face justice in this district,” said U.S. Attorney Randy Grossman for the Southern District of California. “Stopping the flow of funds to drug cartels and of deadly drugs into the United States continues to be a priority for us and our law enforcement partners.”

“This sentencing is the culmination of years of relentless work by Homeland Security Investigations (HSI) and its partners targeting the Sinaloa Cartel,” said Special Agent in Charge Chad Plantz of HSI San Diego. “This investigation highlights HSI’s dedication to go after both cartel drug trafficking and money laundering activity. The sentencing sends a resounding message to Transnational Criminal Organizations that HSI and our partners are unyielding in our pursuit of justice.”

Seven other defendants have previously pleaded guilty in the case and been sentenced: Omar Ayon-Diaz, Osvaldo Contreras-Arriaga, Cesar Hernandez-Martinez, Gibran Rodriguez-Mejia, Oscar Rodriguez-Guevara, Bianca Acedo Ojeda, and Joel Acedo Ojeda. In addition, approximately 20 other individuals linked to the scheme who served as drug and money couriers and drug stash house operators have entered guilty pleas and been sentenced in related cases.       

The investigation was conducted by HSI. The Justice Department’s Office of International Affairs worked with law enforcement partners in Mexico to secure the arrest of Gallegos-Lechuga in Mexico and his extradition to the United States.

The case is being prosecuted by Senior Trial Counsel Mark Irish of the Criminal Division’s Money Laundering and Asset Recovery Section and Assistant U.S. Attorney Larry Casper of the U.S. Attorney’s Office for the Southern District of California.

Assistant U. S. Attorney Larry Casper (619) 546-6734  

NEWS RELEASE SUMMARY – January 11, 2022

SAN DIEGO – Roberto Gallegos-Lechuga, a drug trafficker and money launderer for the Sinaloa Cartel, was sentenced in federal court yesterday to 188 months in prison for supervising the smuggling of multi-kilogram quantities of cocaine, methamphetamine and heroin from Mexico into the United States and the smuggling of drug proceeds from the United States to Mexico.  

Gallegos-Lechuga, 39, of Sinaloa, Mexico, was extradited from Mexico to San Diego in March of 2020. In July 2021, he pleaded guilty to conspiracy to commit international money laundering. According to court documents, Gallegos-Lechuga coordinated the smuggling of large quantities of illegal narcotics through ports of entry in Southern California. Gallegos-Lechuga also supervised and managed couriers who smuggled hundreds of thousands of dollars in cash at a time, from the illegal sale of drugs, from the United States to Mexico as part of the cartel’s ongoing efforts to promote drug trafficking.

“Those who manage drug trafficking and money laundering efforts for the Sinaloa cartel, one of the most violent criminal organizations in the world, will continue to face justice in this district,” said U.S. Attorney Randy Grossman for the Southern District of California. “Stopping the flow of funds to drug cartels and of deadly drugs into the United States continues to be a priority for us and our law enforcement partners.”  Grossman also thanked prosecutor Larry Casper and HSI agents for their excellent work on this case.

“This defendant was part of a violent transnational criminal organization that posed a danger to our communities,” said Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division. “We will prosecute to the fullest extent of the law those who export dangerous narcotics to the United States and finance those activities through money laundering. I want to thank the Government of Mexico for extraditing Gallegos-Lechuga to the United States. Through such partnerships, we will continue to work to dismantle dangerous drug cartels.”

“Today’s sentencing is the culmination of years of relentless work by Homeland Security Investigations (HSI) and its partners targeting the Sinaloa Cartel,” said HSI San Diego Special Agent in Charge Chad Plantz.  “This investigation highlights HSI’s dedication to go after both Cartel drug trafficking and money laundering activity.  The sentencing sends a resounding message to Transnational Criminal Organizations that HSI and our partners are unyielding in our pursuit of justice.”

Seven other defendants have previously pleaded guilty in this case and been sentenced, including Omar Ayon-Diaz, Osvaldo Contreras-Arriaga, Cesar Hernandez-Martinez, Gibran Rodriguez-Mejia, Oscar Rodriguez-Guevara, Bianca Acedo Ojeda and Joel Acedo Ojeda. In addition, approximately 20 other individuals linked to the conspiracy who served as drug and money couriers and drug stash house operators have entered guilty pleas and been sentenced in related cases.           

The investigation was conducted by Homeland Security Investigations. The Justice Department’s Office of International Affairs worked with law enforcement partners in Mexico to secure the arrest of Gallegos-Lechuga in Mexico and his extradition to the United States.

The case is being prosecuted by Assistant U.S. Attorney Larry Casper of the U.S. Attorney’s Office for the Southern District of California and Senior Trial Counsel Mark Irish of the Criminal Division’s Money Laundering and Asset Recovery Section.

DEFENDANT                                               Case Number 15cr950-BEN                                       

Roberto Gallegos-Lechuga                             Age: 39                       Sinaloa, Mexico

SUMMARY OF CHARGES

Money Laundering Conspiracy – Title 18, U.S.C., Section 1956(h)

Maximum penalty: Twenty years in prison and $500,000 fine

AGENCY

Homeland Security Investigations

Assistant U. S. Attorney Rebecca S. Kanter (619) 546-7304   

NEWS RELEASE SUMMARY – January 10, 2022

SAN DIEGO – Derick Jonathan Cameron of Vancouver, Washington, was sentenced in federal court today to 20 months in prison for embezzling more than $400,000 when he was employed as the Financial Controller for San Diego-based RAL Investment Corporation. 

Cameron previously pleaded guilty, admitting that he abused his access to the company’s accounting software by issuing more than 200 unauthorized checks to himself using the electronic signature of the company’s CFO and depositing them into his personal bank account. He then concealed the payments by manipulating the company’s accounting records to make it appear that each check was issued to a legitimate third-party vendor for a business expense.  The company discovered Cameron’s fraudulent activity in April 2018, fired Cameron, and reported the conduct to law enforcement when Cameron was unable to make his promised repayments on schedule.

In addition to the 20 months of federal custody, U.S. District Judge Todd W. Robinson imposed three years’ supervised release, an $8,000 fine and ordered Cameron to pay restitution of $203,857 to the victim, RAL Investment Corporation, which is the difference between the amount Cameron embezzled ($403,857) and the amount he repaid his former employer in 2018 ($200,000) after his theft was detected. The Court specifically ordered Cameron to repay $10,000 by March 12, 2022, suggesting Cameron could sell a recently purchased motorcycle to pay the debt.

“The impact of fraud on small businesses can be devastating,” said U.S. Attorney Randy Grossman. “This defendant abused his position of trust to enrich himself, and he has been held to account for his crime.” Grossman thanked the prosecution team and the FBI for the excellent work on this case.

“The FBI will continue to vigorously pursue those who use their workplace access for personal and financial gain over professional responsibility,” said FBI Special Agent in Charge Suzanne Turner. “Mr. Cameron’s check-writing scheme hurt this small, family-owned business, endangered its livelihood, and impacted its employees. Today, Mr. Cameron faced judgement for those criminal actions.” 

Cameron is scheduled to surrender to the Bureau of Prisons on or before March 14, 2022.

DEFENDANTS                                             Case Number 21cr2128-TWR                          

Derick Jonathan Cameron                                          Age: 38                       Vancouver, Washington

SUMMARY OF CHARGES

Wire Fraud – Title 18, U.S.C., Section 1343

Maximum penalty: Twenty years in prison and $250,000 fine, or twice the gain/loss, whichever is greater

AGENCY

Federal Bureau of Investigation

Assistant U. S. Attorneys Valerie H. Chu (619) 546-6750 and Michelle L. Wasserman (619) 546-8314

NEWS RELEASE SUMMARY – January 4, 2022

SAN DIEGO – Rabbi Yisroel Goldstein, former director at Chabad of Poway, was sentenced in federal court today to fourteen months in custody for his years-long, multi-million-dollar schemes to defraud the Internal Revenue Service, several San Diego Fortune 500 companies, and multiple public and private agencies.  He was also ordered to pay restitution totaling $2,834,608.

According to his plea agreement, while Rabbi Goldstein was director of the Poway synagogue, he received at least $6.2 million in phony contributions to the Chabad and affiliated charities and secretly refunded up to 90 percent of the donations to the “donors.” After Rabbi Goldstein provided these donors with fake receipts, they illegally claimed huge tax deductions for these nonexistent donations, and the rabbi kept about 10 percent – more than half a million dollars over the course of the fraud - for himself. Tax losses to the IRS were more than $1.5 million.

Rabbi Goldstein also admitted that he defrauded three different Fortune 500 companies by tricking them into matching supposed charitable donations of their employees.  Working with the employees, Rabbi Goldstein fabricated receipts and then secretly returned their fake “donations.”  This allowed the employees to claim tax deductions for the completely fabricated donations, and allowed Rabbi Goldstein to collect the companies’ matching funds—including some that matched double their employees’ donations. Rabbi Goldstein helped to orchestrate this scheme with at least six taxpayer-employees and two other associates who helped recruit new donors or conceal the true recipient of the funds.  In total, Rabbi Goldstein defrauded the companies out of at least $144,000, and helped the taxpayer-employees to claim nearly as much in fictitious tax-deductible charitable contributions to the IRS.

Rabbi Goldstein admitted that he also helped his brother Mendel Goldstein conceal approximately $700,000 in income by allowing him to use Chabad bank accounts to deposit his income, thereby hiding it from the IRS.  As his cut, Rabbi Goldstein kept 10 percent of this individual’s income—more than $70,000. 

Separate and apart from the tax evasion scheme, Rabbi Goldstein and another defendant, Alexander Avergoon, used false information and fabricated invoices and other records to pretend to be eligible for emergency funds, grants or donations, and private loans. These frauds on the Federal Emergency Management Agency (FEMA), the California Governor’s Office of Emergency Services (Cal OES), and private foundations resulted in losses to these programs of at least $860,000. 

According to sentencing documents, the United States Attorney’s Office recommended departures from the sentencing guidelines for Goldstein because of his cooperation against other individuals, and because of the extraordinary events he suffered as a victim of the April 27, 2019 shooting at the Chabad of Poway. 

In imposing sentence, U.S. District Judge Cynthia A. Bashant commented, “You dragged down so many congregants.  Many of those individuals thought that they were committing these offenses to benefit the Chabad or the synagogue in general, when in fact it was to benefit you.  I just can’t ignore that. … I think time in custody is important.  It’s important to send a message to the community, and it’s important to send a message to you.” 

“Yisroel Goldstein exploited his position and stature as a faith leader to commit well-planned and carefully executed crimes of greed,” said U.S. Attorney Randy Grossman. “As his serious criminal conduct was under investigation, the rabbi became a victim in a devastating attack on the synagogue he led.  Today’s sentence accounts for these extraordinary circumstances and our office’s mission to always seek justice.” Grossman thanked the prosecution team, the FBI and the IRS for their excellent work on this case.

“The defendant used the Chabad of Poway’s tax-exempt status as a religious organization to compile millions of dollars in fraudulent ‘donations’,” said FBI Special Agent in Charge Suzanne Turner. “This scheme enabled Rabbi Goldstein to line his own pockets; reward his fake ‘donors’ with reimbursement for their contributions; and provided receipts enabling the ‘donations’ to be written off as charitable contributions, all in furtherance of the scheme. The FBI will continue to root out fraud disguised as charitable donations which ultimately hurts those organizations relying on the generosity of donors.”

“Rabbi Goldstein veiled over $2.8 million in fraud schemes he perpetrated with at least ten other co-conspirators by exploiting the non-profit statuses of the Chabad of Poway and the Friendship Circle of San Diego, organizations entrusted to him to serve the community,” said Special Agent in Charge Ryan L. Korner of IRS Criminal Investigation's Los Angeles Field Office.  “IRS Special Agents were proud to work alongside the FBI and the U.S. Attorney's Office in this multimillion-dollar tax and grant fraud investigation that uncovered decades of illegal conduct.  In addition to holding Rabbi Goldstein accountable for cheating U.S. taxpayers and businesses for personal gain, my fervent hope is that today's sentencing brings closure and healing to all who were affected by his crimes.”

Rabbi Goldstein was ordered to surrender into federal custody by noon on February 23, 2022. 

DEFENDANT                                   Case Number 20CR1916-BAS              

Yisroel Goldstein                                Age: 60                       Poway

SUMMARY OF CHARGES          

Conspiracy to Defraud the United States and Commit Wire Fraud, in violation of Title 18, USC 371
Maximum Penalty: Five years in prison

INVESTIGATING AGENCIES:

Federal Bureau of Investigation

Internal Revenue Service – Criminal Investigation

Assistant U.S. Attorneys Kevin Mokhtari (619) 546-8402 and David J. Rawls (619) 546-7966

NEWS RELEASE SUMMARY – January 4, 2021

SAN DIEGO – Sean T. Sheeter, the owner of a large residential compound located at 725 Poinsettia, Vista, California, pleaded guilty in federal court today, admitting that he maintained the property as a drug-involved premises.  Sheeter was charged just before the pandemic, in March 2020, with a violation of the federal “Crack House” statute. 

As part of the plea agreement, Sheeter admitted that he knowingly and intentionally rented, leased, profited from and made the property available for use to certain residents and guests.  Sheeter admitted that he knew or reasonably should have known that many of the residents and guests used the property for the purpose of unlawfully storing, distributing and using federally controlled substances, including heroin and methamphetamine. 

Sheeter also admitted that in many instances, his residents’ and guests’ primary reasons for renting, residing at, and/or visiting the property were so they could store, distribute and/or use controlled substances without interference. Sheeter admitted that this activity “was pervasive” on the property. 

As part of his plea agreement and related documents, Sheeter’s property will be sold, and proceeds from that sale will be forfeited to the federal government.  Sheeter is scheduled to be sentenced on April 1, 2022 at 9 a.m. before U.S. District Judge Janis L. Sammartino.

The federal indictment against Sheeter was the result of a multi-year investigation led by the North County Regional Gang Task Force, which is spearheaded by the FBI and the San Diego Sheriff’s Department. The investigation involved months of federal wiretaps, multiple undercover drug buys, and surveillance that led investigators to learn about the criminal activity on the property.

A search warrant unsealed with the indictment revealed that between January 1, 2017 and February 25, 2020, law enforcement activity at the property was extensive, including dozens of separate calls for service, arrests, citations, and seizures of controlled substance directly tied to the property. Today’s guilty plea is the first step in restoring normalcy to the Vista neighborhood that has been plagued by criminal activity emanating from the property. 

“This property is no longer a drug-laden refuge for violent felons, gang members, drug dealers and drug users,” said U.S. Attorney Randy Grossman. “We will continue to use every tool we have to bring safety to our community.” Grossman thanked the prosecution team and all the law enforcement agencies for their hard work on this case.

“Today's guilty plea should send a message to others that are operating drug houses around the county,” said FBI Special Agent in Charge Suzanne Turner. “The FBI and our law enforcement partners will continue to bring investigative resources together, through a variety of different task forces, to root out criminal enterprises committed to furthering illegal activity.”

“The hard work conducted by the men and women of San Diego's North County Regional Gang Task Force in investigating this case and the partnerships used to abate this extensive narcotics problem is a huge step toward improving the quality of life in the surrounding community,” said Sheriff Bill Gore. “The multitude of criminal activity stemming from this residence not only impacted the area immediately surrounding it, but local schools and the neighboring cities of Vista and San Marcos. We are confident this abatement will bring about an improved quality of life for all impacted by this decision.”

This operation 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.

DEFENDANT                                               Case Number 21cr0656-JLS                                        

Sean Terrence Sheeter                                                Age: 73                                   Vista, CA

SUMMARY OF CHARGES

Maintaining a Drug-Involved Premises – Title 21, U.S.C., Section 856(a)(2)
Criminal Forfeiture – Title 21, U.S.C., Section 853

Maximum Penalty: Twenty years in prison and $500,000 fine

AGENCIES

Federal Bureau of Investigation

San Diego Sheriff’s Department

United States Marshals Service

Bureau of Alcohol, Tobacco, Firearms and Explosives

Homeland Security Investigations

Drug Enforcement Administration

Carlsbad Police Department

Oceanside Police Department

Escondido Police Department

California Department of Corrections and Rehabilitation

California Highway Patrol

Department of Justice, Organized Crime and Drug Enforcement Task Force (OCDETF)

Department of Justice, Office of Enforcement Operations

Assistant U. S. Attorneys Oleksandra Johnson (619) 546-9769 and Valerie H. Chu (619) 546-6750

NEWS RELEASE SUMMARY – January 3, 2022

SAN DIEGO – Alexander Avergoon, a longtime San Diego real estate agent and businessman, was sentenced in federal court today to 64 months in prison for defrauding investors in several Ponzi real estate investment schemes.  As part of his guilty plea, Avergoon also admitted to participating in multiple tax evasion and fraud schemes with Rabbi Yisroel Goldstein, former director at Chabad of Poway.

Avergoon was ordered to pay $9,679,306.70 in restitution to several victims. The Court also ordered Avergoon to forfeit to the United States the amount of $5,205,234.41 as proceeds of illegal conduct and property involved in the offense. 

“This defendant is a prolific fraudster who has stolen millions of dollars from the many victims of his devious schemes,” said U.S. Attorney Randy Grossman. “It’s now his turn to pay the price for his crimes.” Grossman thanked the prosecution team, the FBI and the IRS for their dedication to achieving justice in this matter.

“The defendant participated in complex financial schemes which defrauded private citizens out of millions of dollars,” said FBI Special Agent in Charge Suzanne Turner. “The FBI will continue to work with our law enforcement partners to root out all forms of financial fraud which not only hurt the victims, but also negatively impact those who rely on individual donors and investors to conduct legitimate business.”

“Mr. Avergoon victimized dozens of investors twofold, by not only swindling them out of millions of dollars, but also recruiting victim-investors to commit tax fraud,” said Special Agent in Charge Ryan L. Korner of IRS Criminal Investigation’s Los Angeles Field Office.  “Today’s sentencing sends a clear message that IRS Criminal Investigation will pursue and hold accountable financial fraudsters who deceive and cheat people seeking to invest in our real estate and lending markets. Our Special Agents were proud to work with the FBI and the U.S. Attorney’s Office to bring Mr. Avergoon’s schemes to an end.”

Avergoon pleaded guilty in July 2020, admitting that from 2010 to 2015, he and Goldstein recruited at least nine taxpayers who made more than $275,000 in fraudulent “donations” to the Chabad. Avergoon acted as a conduit to secretly return 90 percent of the money to the purported “donors.”  Avergoon also admitted that he joined Rabbi Goldstein in a grant fraud scam in which they obtained hundreds of thousands of dollars in misappropriated grant funds, and a government benefits fraud scheme.

As part of the government benefits fraud scheme, Avergoon used shell companies, including “Imagination Construction Company,” to create fictitious and backdated invoices for services like carpet installation, repairs to the Chabad of Poway’s HVAC system, and replacing damaged books and other supplies—even though Avergoon had never performed these services.  In some cases, Avergoon would give Goldstein several fake bids from different shell companies, so that Rabbi Goldstein could trick the grant program administrators into believing he had complied with their competitive bidding requirements.  Avergoon and Goldstein pretended that the government grant funds would be used for facilities upgrades, security systems, and community programs.  But in reality, the money often went straight to Goldstein’s and Avergoon’s pockets; other times they used portions of it to pay contractors who had in fact charged much lower prices than reflected on Avergoon’s phony paperwork.

Apart from his fraudulent partnership with Rabbi Goldstein, Avergoon also admitted to participating in separate real estate Ponzi schemes from 2010 to 2016, in which he cheated retirement investors out of a total of $12 million. Avergoon was a San Diego-based real estate agent, and he used his industry knowledge and reputation to target trusting victims who would invest in what they thought was the purchase of rental property. 

Avergoon promised monthly dividends that would be paid from rental income.  He created written investment materials like prospectus and projected income and expenses calculations, designed to give investors the false impression that their money would be safely tucked away in passive-income retirement investments.  But in truth, instead of using investors’ money to buy rental properties as he promised, Avergoon spent the money himself and just pretended that he had purchased the apartment buildings and office space he advertised.  In true Ponzi fashion, for a time, Avergoon made the promised dividend payments—but rather than using rent income, he funded those payments using new investor money.

Avergoon deceived more than a dozen unwitting investors, convincing them to part with at least $5 million.  When an investor would ask to cash out, he encouraged them to re-invest, and at one point he pretended to “roll over” their retirement investments to purchase a multi-million-dollar commercial building. In reality, he bought that building with a loan, not with investor money, and again diverted their money to his own personal use.  He created fake partnership agreements, false purchase documents and deeds, and other fictitious records, and forged the signatures of his investors to conceal the fraud—then laundered the proceeds in order to disguise the true source and ownership of the money.

Avergoon did not stop there.  He convinced investors to part with another $5 million or more by pretending to use their money to fund short-term, low-risk loans supposedly secured by the borrowers’ high-end San Diego homes.  But in reality, there were no “borrowers”—Avergoon used his real estate connections to identify homes he could pose as collateral, and he simply doctored up fake loan agreements and forged the borrowers’ signatures.  In some cases, the individuals he claimed were the borrowers did not even own the homes that were purportedly used as collateral.  Avergoon made fake loan agreements, Deeds of Trust, mortgage Notes, and other official-looking documents, and he even created fake notary stamps and San Diego County Recorder’s Office markings to make the paperwork appear legitimate.  Once again, Avergoon used new investor money to make occasional payments to his victims, to make it appear that the “loans” were performing.  But in truth, he diverted the money to his own use and the “investments” were worthless.

Avergoon was indicted in August 2019 and apprehended in Latvia.  He was extradited to the United States in November 2019 and has remained in custody since his extradition and initial appearance in federal court in San Diego.

DEFENDANT                                                                       Case Number 19cr2955-BAS                   

Alexander Avergoon       Age: 46           San Diego                  

CHARGES

Wire Fraud, in violation of Title 18, USC 1343
Maximum Penalty: Twenty years in prison

Aggravated Identity Theft, in violation of Title 18, USC 1028A
Maximum Penalty: Two years minimum consecutive term in prison

Money Laundering, in violation of Title 18, USC 1956(a)(1)(B)(i)
Maximum Penalty: Twenty years in prison

INVESTIGATING AGENCIES  

Federal Bureau of Investigation

Internal Revenue Service – Criminal Investigations

Assistant U. S. Attorneys Vivian Sapthavee (619) 546-7696 and Adam Gordon (619) 546-6720

NEWS RELEASE SUMMARY—December 28, 2021

SAN DIEGO - Kaylar Junior Tawan Beltranlap of San Diego appeared in federal court today in connection with a grand jury indictment charging him with selling the fentanyl that resulted in the death of a 15-year-old Coronado High School sophomore on May 12, 2021.

Agents and Task Force officers with the Drug Enforcement Administration are leading the investigation into the death. The next court date is set for February 4, 2022 for a Motion Hearing/Trial Setting.

“Every loss of life to opioids is tragic, but the death of a 15-year-old is heart-shattering,” said Acting U.S. Attorney Randy Grossman. “Our community must recognize the threat to middle and high school students from the plague of fentanyl. This case must be a call to action to educate our children about the extreme danger of experimenting with drugs.” Grossman thanked the prosecution team and investigating agencies for their dedication to this case and to the cause of preventing opioid-related deaths and seeking justice for victims.

“The Coronado Police Department is thankful for the collective work to hold the suspect accountable. We are also reminded that we have a family that lost a child because of a dangerous drug,” - Coronado Police Chief Chuck Kaye. 

“Parents: More than ever before, it’s so important to educate your teenager about the dangers of drugs because just One Pill Can Kill,” said DEA Acting Special Agent in Charge Shelly S. Howe. “If you don’t have the conversation with your teen, their friends or a drug dealer will give them inaccurate information and it could cost your child’s life.  The DEA has resources available to parents at www.getsmartaboutdrugs.gov.”

This case is the result of ongoing efforts by the U.S. Attorney’s Office, Drug Enforcement Administration, Homeland Security Investigations, the Federal Bureau of Investigation, the San Diego Police Department, the California Department of Health Care Services and the San Diego County District Attorney’s Office to investigate and prosecute the distribution of dangerous illegal drugs—fentanyl in particular—that result in overdose deaths. The DEA created Narcotics Task Force (NTF) Team 10 as a response to the increase in overdose deaths in San Diego County. Investigators from Team 10, as well as the Coronado Police Department and NTF Team 3, contributed to the investigation into C.J.S.’s death.

DEFENDANT                                               Case Number 21-CR-3442 CAB                                          

Kaylar Junior Tawan Beltranlap                    Age: 21                       San Diego, CA

SUMMARY OF CHARGES

Distribute of Fentanyl Resulting in Death – Title 21, United States Code, Sections 841(a) and (b)(1)(C)

Maximum penalty: Life in prison; Twenty-year mandatory minimum

AGENCY

Drug Enforcement Administration

Homeland Security Investigations

Federal Bureau of Investigation

Coronado Police Department

San Diego Police Department

California Department of Health Care Services

*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.

Assistant U. S. Attorneys Peter Ko (619) 546-7359 and Shane Harrigan (619) 546-6981

NEWS RELEASE SUMMARY – December 28, 2021

SAN DIEGO – John T. Earnest, a Rancho Penasquitos man who entered the Chabad of Poway on April 27, 2019, opened fire and killed one woman, injured three others, and attempted to kill 50 others, was sentenced in federal court today to life plus 30 years in prison for his crimes. 

Earnest previously pleaded guilty to a 113-count indictment that included 54 counts of violating the Matthew Shepard and James Byrd Jr. Hate Crimes Prevention Act, 55 counts of violating the Church Arson Prevention Act, and four firearms offenses.

Earnest also admitted that on March 24, 2019, he attempted to burn down the Dar-ul-Arqam mosque in Escondido, California, because of his hatred of Muslims and the religious character of the building. Seven missionaries were asleep in the mosque, but no one was injured.

“All people in this country should be able to freely exercise their religion without fear of being attacked,” said Attorney General Merrick B. Garland. “This defendant’s horrific crime was an assault on fundamental principles of our nation.  The Justice Department is steadfast in its commitment to confronting unlawful acts of hate and to holding perpetrators of hate-fueled violence accountable.”

“Today we stand with the family of Lori Gilbert Kaye, the injured, and all who suffered as a result of the defendant’s heinous crimes,” said U.S. Attorney Randy Grossman. “The United States Attorney’s Office and our law enforcement partners reject all forms of hatred and prejudice, and we will relentlessly pursue justice for the victims of bias-motivated violence.” Grossman thanked the prosecution team, the Department of Justice’s Civil Rights Division, the FBI, the ATF, the San Diego Sheriff’s Department, and the San Diego Police Department for their excellent work on this case.

“Hate has no place in our society and bias-motivated violence will not be tolerated,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “By committing these heinous and senseless acts of violence against Jewish and Muslim community members, this defendant violated our most basic American ideal: all persons are created equal. The Department of Justice is committed to aggressively prosecuting bias-motivated violence and will continue partnering with state and local law enforcement to ensure that those who seek to engage in violence based on bias are held accountable for their crimes.”

“While today's sentence brings an end to this case, it also reaffirms the FBI's commitment to pursue those who operate in the world of prejudice and religious hate,” said FBI Special Agent in Charge Suzanne Turner. “Hate crimes tear at the social fabric of our community. The FBI stands with our state and federal partners to ensure houses of worship are free from bias-motivated violence, and we will use all investigative tools to seek justice for the victims.”

“ATF will continue to use all investigative tools and resources at our disposal to combat hate-fueled gun violence,” said ATF Special Agent in Charge Monique Villegas. “Hatred of any kind has no place in our society and we will work tirelessly with our federal and local law enforcement partners to ensure any individual or groups that perpetuate criminal acts are held accountable for their actions.  

According to court documents, after several weeks of planning, on the morning of April 27, 2019, Earnest drove to the Chabad of Poway synagogue, where members of the congregation were gathered for religious worship. Earnest entered the building armed with a Smith and Wesson M&P 15 assault rifle that was fully loaded with a 10-round magazine. He wore a chest rig which contained five additional magazines, each loaded with ten rounds of ammunition. Earnest opened fire, killing Lori Gilbert-Kaye and injuring three other members of the congregation, including a then eight-year-old child. After Earnest emptied his initial magazine, several congregants rushed at Earnest. Earnest fled in his car and, shortly after, called 911 and confessed that he had “just shot up a synagogue.” Earnest was apprehended by local law enforcement who found the rifle and additional ammunition in his car.

Investigators found a manifesto written by Earnest and posted on the Internet shortly before the attack. In the manifesto, Earnest made many anti-Semitic and anti-Muslim statements, including “I can only kill so many Jews” and “I only wish I killed more.”

The case is being prosecuted by Assistant U.S. Attorneys Shane Harrigan and Peter Ko, along with Deputy Chief Rose Gibson of the Civil Rights Division. The FBI, ATF, and San Diego Sheriff’s Department conducted the investigation. 

John T. Earnest, a California man who entered the Chabad of Poway on April 27, 2019, opened fire and killed one woman, injured three others, and attempted to kill 50 others, was sentenced today in the Southern District of California to life followed by 30 years in prison for his crimes. 

Earnest previously pleaded guilty to a 113-count indictment that included 54 counts of violating the Matthew Shepard and James Byrd Jr. Hate Crimes Prevention Act, 55 counts of violating the Church Arson Prevention Act, and four firearms offenses.

“All people in this country should be able to freely exercise their religion without fear of being attacked,” said Attorney General Merrick B. Garland. “This defendant’s horrific crime was an assault on fundamental principles of our nation.  The Justice Department is steadfast in its commitment to confronting unlawful acts of hate and to holding perpetrators of hate-fueled violence accountable.”

“Hate has no place in our society and bias-motivated violence will not be tolerated,” said Assistant Attorney General Kristen Clarke. “By committing these heinous and senseless acts of violence against Jewish and Muslim community members, this defendant violated our most basic American ideal: all persons are created equal. The Department of Justice is committed to aggressively prosecuting bias-motivated violence and will continue partnering with state and local law enforcement to ensure that those who seek to engage in violence based on bias are held accountable for their crimes.”

“Today we stand with the family of Lori Gilbert Kaye, the injured, and all who suffered as a result of the defendant’s heinous crimes,” said U.S. Attorney Randy Grossman of the Southern District of California. “The United States Attorney’s Office and our law enforcement partners reject all forms of hatred and prejudice, and we will relentlessly pursue justice for the victims of bias-motivated violence.”

According to court documents, after several weeks of planning, on the morning of April 27, 2019, Earnest drove to the Chabad of Poway synagogue, where members of the congregation were gathered for religious worship. Earnest entered the building armed with a Smith and Wesson M&P 15 assault rifle that was fully loaded with a 10-round magazine. He wore a chest rig which contained five additional magazines, each loaded with ten rounds of ammunition. Earnest opened fire, killing one person and injuring three other members of the congregation, including a then eight-year-old child. After Earnest emptied his initial magazine, several congregants rushed at Earnest. Earnest fled in his car and, shortly after, called 911 and confessed that he had “just shot up a synagogue.” Earnest was apprehended by local law enforcement who found the rifle and additional ammunition in his car.

Investigators found a manifesto written by Earnest and posted on the Internet shortly before the attack. In the manifesto, Earnest made many anti-Semitic and anti-Muslim statements, including expressing a desire to kill people because of their Jewish faith, and regret that he could not kill more.

Earnest also admitted that on March 24, 2019, he attempted to set fire to the Dar-ul-Arqam mosque in Escondido, California, because of his hatred of Muslims and the religious character of the building. Seven missionaries were asleep in the mosque, but no one was injured.

The court ordered that the federal sentence will run consecutive to the state sentence. The court further recommended that Earnest serve his term of incarceration in a federal facility.

The case is being prosecuted by Assistant U.S. Attorneys Shane Harrigan and Peter Ko, along with Deputy Chief Rose Gibson of the Civil Rights Division. The FBI, ATF and San Diego Sheriff’s Office conducted the investigation. 

下記の日本語文書は参考のための仮翻訳で、正文は英文 です。 

 

司法省 

 

カリフォルニア州南部地区連邦検事局 

 

2021年12月20日（月） 

 

即時のプレスリリース

 

米政府が横領金1億5000万ドルをソニーに返金するため民事訴訟を起こし、FBIが資金をビットコインに追跡 

担当連絡先

オレクサンドラ・ジョンソン検事補　(619) 546-9769

アーロン・P・アルンゼン検事補　(619) 546-8384

プレスリリース要旨 ― 2021年12月20日 

 

サンディエゴ ― 米政府は本日、東京に本社があるソニーグループ株式会社の子会社から詐取され、その後、米連邦捜査局(FBI)による窃盗事件捜査中に法執行機関によって差し押さえられ1億5400万ドルを超える資金を保全し、最終的に返還するため連邦裁判所に提訴した。 

 

米国は、当該資産に対するソニーの利害保全を目的として、カリフォルニア州南部地区連邦裁判所に民事没収を申し立てた。この資産は、2021年5月に従業員が詐取した上で、現在の相場で1億8000万ドル以上に相当する3879ビットコイン超に換金したとされる。FBIの捜査に基づき、2021年12月1日に法執行機関によって差し押さえられた。 

 

政府の申し立てによると、東京のソニー生命保険株式会社（ソニー生命）社員の石井伶は、会社が会社名義の金融口座間で資金移動をしようとした際に、1億5400万ドルを流用したとされる。申し立てはまた、石井が取引指示を改ざんすることで、当該資金をカリフォルニア州ラホヤ所在の銀行にある自身が管理する口座へ送金し、その後間を置かず暗号通貨であるビットコインに換金した、と述べている。

 

FBIの捜査で明らかとなった証拠に基づき、2021年6月、カリフォルニア州南部地区連邦裁判所の下級判事によって差し押さえ令状が許可された。裏付けとなる宣誓供述書で陳述されたように、法執行機関は転送されたビットコインを追跡し、ソニー生命の子会社から詐取された資金額に相当する3879.16ビットコインが特定のビットコインアドレスに送金され、後にオフラインの暗号通貨コールドウォレットに移動されていたことを特定した。 

 

FBIは、ソニー及びシティバンクから多大な支援を受けつつ、警察庁、警視庁、東京地方検察庁、最高検察庁・先端犯罪検察ユニット (JPEC) と連携し、引き続き捜査を行った。このような連携した取り組みにより、捜査員らは、ビットコインアドレスのアクセスに必要なパスワードにほぼ相当する“秘密鍵”を入手した。この窃盗に起因する全てのビットコインは回収され、完全に保全された。石井は、日本で刑事告訴されている。 

 

ランディ・S・グロスマン連邦検事代理は、以下のように述べた。「我々の目的は盗まれた資金を、この大胆な窃盗事件の被害者に返還することであり、本日とられた措置は、その目的達成に資するものである。本事件は、FBI捜査員と日本の法執行機関が、仮想通貨の追跡に連携して取り組んだ好例である。犯罪者が留意すべきことである。不正に手にした収益を法執行機関から隠匿するために暗号通貨を当てにすることはできない。米国は犯罪を未然に防ぎ、盗まれた資金を取り戻すため、国際的なパートナー機関と幅広く連携していく」。グロスマンは、検察チーム、FBI、日本の当局に対して、本事件への素晴らしい仕事に感謝した。

 

スーザン・ターナーＦＢＩ支局長は、「FBIは2つの極めて大きな理由により、詐取された資金の回収ができた。第一に、ソニーとシティバンクは窃盗を認知した直後に法執行機関に通知・協力し、FBIも両社と連携し資金の追跡を行った。第二に、今回の場合は日本にあたるが、FBIが海外に設置した法務官事務所および海外で構築した既存の関係性を通じて国際的に築いた資源により、法執行機関が連携し、容疑者を特定できた。FBIの持つ専門技術により、詐取された資金を被告の暗号通貨ウォレット内で発見し、差し押さえすることが可能になった」と述べた。 

 

カリフォルニア州南部地区連邦検事局の大規模詐欺・公務汚職課と資産回復室は、司法省刑事部の資金洗浄・資産回復課およびコンピューター犯罪・知的財産課から多大な支援を受け、訴訟手続きを実施している。司法省国際室も捜査支援を提供した。FBIも本事件を引き続き捜査している。

 

 

 

 

Director of Media Relations Kelly Thornton 619-546-9726

SAN DIEGO -- On December 26, 2021, Randy S. Grossman began serving as the United States Attorney for the Southern District of California for an interim period of 120 days or until a Presidential appointee is confirmed, whichever occurs first.

Attorney General Merrick Garland issued an order on December 13, 2021, authorizing Grossman’s appointment as U.S. Attorney, effective December 26, 2021. U.S. District Court Chief Judge Dana Sabraw administered the oath of office to Grossman on December 17, 2021, in the presence of the leadership team and Grossman’s family.

Grossman, who previously served as second-in-command, was named Acting U.S. Attorney under the Vacancies Reform Act after the resignation on February 28, 2021, of then-U.S. Attorney Robert S. Brewer Jr.  Grossman now becomes U.S. Attorney by Attorney General appointment, in the absence of a presidentially-nominated and U.S. Senate-confirmed U.S. Attorney, for a term of 120 days or until a U.S. Attorney is confirmed. If a U.S. Attorney is not nominated and confirmed within that period, a U.S. Attorney would be appointed by the United States District Court for the Southern District of California.

“It is an honor to continue to serve the Southern District of California,” Grossman said.  “I look forward to continuing to work with the outstanding team at the U.S. Attorney’s Office and the dedicated law enforcement partners who keep our communities safe.”

The Southern District of California encompasses San Diego and Imperial Counties. The U.S. Attorney serves as the chief federal law enforcement official for the district.

Mr. Grossman began his legal career as a Deputy District Attorney for Ventura County and then San Diego County. During his more than eight years as a state prosecutor, Mr. Grossman tried more than 70 cases, including homicides and other crimes of violence. Mr. Grossman also worked in private practice as a partner at two international law firms. His practice areas included complex civil litigation, white collar criminal defense, corporate internal investigations and pro bono representation of refugees seeking asylum.

In March 2020, Mr. Grossman returned to public service as an Assistant United States Attorney for the Southern District of California, where he served in the Border Enforcement Section and the Major Frauds &Public Corruption Section. He was selected to become First Assistant U.S. Attorney in September 2020, and he served as Acting U.S. Attorney from March 1, 2021 until December 26, 2021. 

Media Relations Director Kelly Thornton (619) 546-9726 or [email protected]

NEWS RELEASE SUMMARY – December 23, 2021

SAN DIEGO – The Department of Justice today announced nearly $126 million in funding, including $672,168 to the Cajon Valley Union School District and $347,031 to the Chula Vista Elementary School District, to advance school safety under the STOP School Violence Act.

The grants, awarded by the Office of Justice Programs’ Bureau of Justice Assistance (BJA) and the department’s Office of Community Oriented Policing Services (COPS Office), will help institute safety measures in and around primary and secondary schools, support school violence prevention efforts, provide training to school personnel and students, and implement evidence-based threat assessments. “The Justice Department has no greater responsibility than protecting Americans from harm,” said Attorney General Merrick B. Garland. “Schools must be safe places to learn, and today’s investment of more than $125 million under the STOP School Violence Act will help ensure that they are.”

“This money will improve security at our schools so that our children are safe,” said Acting U.S. Attorney Randy Grossman. “There is no higher priority.”

The Students, Teachers and Officers Preventing School Violence Act of 2018 (the “STOP School Violence Act”) gives the Justice Department the authority to provide awards directly to states, units of local government, Indian tribes, and public agencies (such as school districts and law enforcement agencies) to improve security at schools and on school grounds through evidence-based school safety programs. It also provides grants to ensure a positive school climate by helping students and teachers recognize, respond quickly to, and help prevent acts of violence. Chula Vista received this grant.

The 78 BJA annual awards, totaling almost $74 million, are intended to support training and education for school personnel and students on preventing violence against others and themselves, including anti-bullying training and specialized training for school officials to respond to mental health crises. Funds also help develop and implement multidisciplinary threat assessment or intervention teams and design technology solutions such as anonymous reporting systems, hotlines and websites.

The COPS School Violence Prevention Program (SVPP) provides up to 75 percent of the funding for school safety measures in and around primary and secondary schools. The 153 SVPP awards, totaling almost $52 million, are statutorily obligated to be used for coordination with law enforcement; training for local law enforcement officers to prevent student violence; locks, lighting and other deterrent measures; technology for expedited notification of local law enforcement during an emergency; and other measures that provide a significant improvement in security. Cajon Valley received this grant.

The full list of SVPP awards can be found here:  https://cops.usdoj.gov/svpp-award.

A list of BJA awards, as they are made, can be found on the OJP Grant Awards page.

The COPS Office is the federal component of the Department of Justice responsible for advancing community policing nationwide. The only Department of Justice agency with policing in its name, the COPS Office was established in 1994 and has been the cornerstone of the nation’s crime fighting strategy with grants, a variety of knowledge resource products, and training and technical assistance. Through the years, the COPS Office has become the go-to agency for law enforcement agencies across the country and continues to listen to the field and provide the resources that are needed to reduce crime and build trust between law enforcement and the communities served. The COPS Office has invested more than $14 billion to advance community policing, including grants awarded to more than 13,000 state, local and tribal law enforcement agencies to fund the hiring and redeployment of more than 135,000 officers.

The Office of Justice Programs provides federal leadership, grants, training, technical assistance and other resources to improve the nation’s capacity to prevent and reduce crime, advance racial equity in the administration of justice, assist victims and enhance the rule of law. More information about OJP and its components can be found at www.ojp.gov.

Assistant U. S. Attorneys Jaclyn Stahl (619) 546-8456 and Megan Rossi (619) 546-9661    

NEWS RELEASE SUMMARY – December 22, 2021

SAN DIEGO – Vyvianna M. Quinonez, a Sacramento resident, pleaded guilty in federal court today to interfering with a Southwest Airlines flight attendant.

According to admissions in her plea agreement, on May 23, 2021, Quinonez boarded Southwest Airlines Flight 700 from Sacramento International Airport to San Diego International Airport. During the flight’s final descent, Quinonez was not wearing her facemask properly, unbuckled her seat belt, and pulled down her tray table—all in violation of federal rules and regulations.

A flight attendant approached Quinonez and requested that she fasten her seat belt, stow her tray table, and wear her facemask properly. The plea agreement states that Quinonez began filming the flight attendant on her cellphone, and that she pushed the flight attendant. Around this time, another passenger began filming the interaction on her cellphone.

Quinonez admitted that she stood up and assaulted the flight attendant by punching her in the face and head with a closed fist and grabbing her hair. Several other passengers attempted to stop Quinonez by grabbing at her clothing and arms. A male passenger sitting nearby jumped in between Quinonez and the flight attendant and instructed Quinonez to sit down.

The plea agreement states that, as a result of being assaulted by Quinonez, the flight attendant was taken to the hospital and sustained several injuries. Three of the flight attendant’s teeth were chipped, resulting in two teeth later being replaced by crowns. The flight attendant’s left eye was bruised and swollen; she sustained a cut under her left eye, requiring three stitches; and she had a bruise in the shape of fingers on her right forearm.

Due to the assault, the flight attendant was not able to perform her normal duties, and the Captain delayed taxiing the airplane to the gate to wait for law enforcement officers to respond.

“The flight attendant who was assaulted was simply doing her job to ensure the safety of all passengers aboard the plane,” said Acting United States Attorney Randy Grossman. “It’s inexcusable for anyone to use violence on an airplane for any reason, particularly toward a flight attendant who is there to keep all the passengers safe. We are not going to tolerate violence or interference with the flight crew, and we will pursue criminal charges against those who break the law.”

Grossman thanked the prosecution team, the FBI, and the San Diego Harbor Police for their excellent work on this case and expressed appreciation to Southwest Airlines, the Transportation Security Administration, and the Federal Aviation Administration for their assistance in this matter.

“The FBI is committed to keeping air travel safe from threats which come in a variety of forms,” said FBI Special Agent in Charge Suzanne Turner. “Assaulting and interfering with flight crews will not be tolerated and the FBI will continue to work with our local, state and federal partners to diligently investigate and prosecute crimes such as these.”

The law enforcement and administrative agencies at the San Diego International Airport have a long-standing history of cooperation in the shared effort to keep travelers safe. To build on these relationships, Acting U.S. Attorney Grossman is working closely with the San Diego District Attorney’s Office, FBI, San Diego Harbor Police, U.S. Customs and Border Protection, TSA, Carlsbad Police Department, FAA, and the San Diego Regional Airport Authority to ensure the timely reporting and investigation of crimes occurring aboard aircraft and at the airport. Assistant U.S. Attorney Jaclyn Stahl and agents with the FBI are developing training for the airport agency partners and the airlines to ensure the early identification of potential federal crimes, address the unique issues associated with investigating these crimes, and streamline the process for prosecuting these crimes—either at the state or federal level.

Quinonez is scheduled to be sentenced before U.S. District Judge Todd W. Robinson on March 11, 2022, at 9 a.m.

DEFENDANT                                               Case Number 21-CR-2816-TWR                            

Vyvianna M. Quinonez                                  Age: 28                                   Sacramento, CA

SUMMARY OF CHARGES

Interference with Flight Crew Members and Attendants – Title 49, U.S.C., 46504

Maximum penalty: Twenty years in prison and $250,000 fine

INVESTIGATING AGENCIES

Federal Bureau of Investigation

San Diego Harbor Police

Transportation Security Administration

Federal Aviation Administration

 

 

 

 

Assistant U. S. Attorney Alexandra F. Foster (619) 546-6735

NEWS RELEASE SUMMARY – December 21, 2021

SAN DIEGO – Ye Sang “Ivy” Wang, a former U.S. Navy sailor who was a Logistics Specialist First Class assigned to the Naval Special Warfare Command, was sentenced to 30 months in custody and ordered to pay a $20,000 fine for conspiring with her husband and co-defendant, Shaohua “Eric” Wang, to illegally export sensitive military equipment to China for profit.

Eric Wang pleaded guilty on September 26, 2019, admitting that he illegally sold export-controlled U.S. military equipment to China through his on-line business and that he enlisted his wife to use her Navy position to purchase the equipment for resale. Eric Wang also admitted that he maintained a warehouse in China to house the military equipment, travelled back and forth frequently, and had connections to buyers in China. On February 3, 2020, U.S. District Court Judge Cynthia Bashant sentenced Eric Wang to 46 months for his role in this scheme.

According to Ivy Wang’s plea agreement and the government’s sentencing memorandum, she purchased military equipment for Naval Special Warfare units as part of her duties as a logistics specialist from 2015 to 2019. In March 2018, she used her military email and mailing address to order a device for identifying United States military personnel in the field. This item was subject to U.S. Department of Commerce export controls, and not advertised for sale to civilians. She was deployed in Iraq at the time the device arrived on base in San Diego. She advised her command that the package containing this device was something she had obtained for her husband for a camping trip. In reality, she bought the device on behalf of her husband for him to resell it to China for profit.

Months later, in October 2018, upon returning from deployment to Iraq, Ivy Wang told the interviewing agents that she knew her husband was shipping military equipment to China illegally. Despite being interviewed by law enforcement agents, Ivy Wang took the device from her Navy command, brought it home and gave it to her husband. The device had been secretly disabled by law enforcement. Upon receipt, Eric Wang messaged a customer that he was in receipt of the item, but advised he could not ship the item to China, because “they are still investigating me... My friend is a SEAL who also got involved. They are investigating him as well.”

Ivy Wang told NCIS and HSI agents during her October 2018 interview that her husband sent her an Excel spreadsheet of military equipment items for her to purchase and that she knew those items were going to buyers in China. Eric Wang told her that he could not buy export-controlled military equipment using his personal email address, so he asked her to do it for him, using her position in the U.S. Navy and her military email address. She grew so annoyed at his repeated requests that, after purchasing equipment for him through March 2018, she gave him her password to her military email address and told him to buy the export-controlled military equipment posing as her after she deployed.

“This defendant used her position of trust to put the Navy and the nation at risk, and the sentence imposed today holds her accountable for her actions,” said Acting U.S. Attorney Randy Grossman, who praised the prosecution team, NCIS, HSI and Department of Commerce for their excellent work on this case.

“Ms. Wang betrayed her oath to the U.S. Navy and ultimately threatened the operational readiness and safety of our nation's military by attempting to acquire and illegally export sensitive military equipment to China,” said Special Agent in Charge Joshua Flowers of the NCIS Southwest Field Office. “NCIS and our partners remain committed to protecting our nation’s critical technologies and infrastructure.”

“This individual abused her position of trust to obtain military-grade equipment, which foreign adversaries could have used against American service members and allies,” said Chad Plantz, Special Agent in Charge of U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI) San Diego. “Fortunately, HSI and our partners were able to prevent this equipment from falling into the wrong hands, but this case serves as a stark reminder of why it’s important for organizations – particularly those involved in national defense – to educate their workforces on how to properly identify and report insider threats.”

DEFENDANTS                                            Case Number 19CR1895-BAS                                    

Shaohua “Eric” WANG          Age: 38           San Diego, CA           

Ye Sang “Ivy” WANG           Age: 37           San Diego, CA

SUMMARY OF CHARGE

Conspiracy to Export Defense Articles Without a License (Title 18, U.S.C., Sec. 371)

Maximum Penalty: Five years in prison, $250,000 fine.

INVESTIGATING AGENCY

Naval Criminal Investigative Service (NCIS);

Homeland Security Investigations (HSI); and

Office of Export Enforcement, Los Angeles Field Office, Department of Commerce

Assistant U. S. Attorneys Oleksandra Johnson (619) 546-9769) and Aaron P. Arnzen (619) 546-8384

NEWS RELEASE SUMMARY – December 20, 2021           

SAN DIEGO – The United States took action in federal court today to protect and ultimately return more than $154 million in funds that were allegedly stolen from a subsidiary of Tokyo-based Sony Group Corporation and then seized by law enforcement during the FBI’s investigation of the theft.

The United States filed a civil forfeiture complaint in the Southern District of California to protect Sony’s interest in the property, which an employee allegedly embezzled in May 2021 and converted to more than 3,879 Bitcoins valued today at more than $180 million. Those funds were seized by law enforcement on December 1, 2021, based on the FBI’s investigation.

According to the government’s complaint, Rei Ishii, an employee of Sony Life Insurance Company Ltd. (“Sony Life”) in Tokyo, allegedly diverted the $154 million when the company attempted to transfer funds between its financial accounts. Ishii allegedly did this by falsifying transaction instructions, which caused the funds to be transferred to an account that Ishii controlled at a bank in La Jolla, California. Ishii then quickly converted the funds to Bitcoin cryptocurrency, the complaint said.

Based on evidence uncovered during the FBI’s investigation, a seizure warrant was authorized in June 2021 by a U.S. Magistrate Judge in the Southern District of California.  As alleged in the supporting affidavit, law enforcement was able to trace Bitcoin transfers and identify that approximately 3,879.16 Bitcoins, representing the proceeds of the funds stolen from a subsidiary of Sony Life, had been transferred to a specific Bitcoin address and then to an offline cryptocurrency cold wallet.

The FBI, with significant assistance from Sony and Citibank, continued to investigate in cooperation with Japan’s National Police Agency, the Tokyo Metropolitan Police Department, Tokyo District Public Prosecutors Office, and JPEC (Japan Prosecutors unit on Emerging Crimes). As a result of this coordinated effort, investigators obtained the “private key” – the rough equivalent of a password – needed to access the Bitcoin address. All the Bitcoins traceable to the theft have been recovered and fully preserved. Ishii has been criminally charged in Japan.

“It is our intent to return the stolen money to the victim of this audacious theft, and today’s action helps us do that,” said Acting U.S. Attorney Randy Grossman. “This case is an example of amazing work by FBI agents and Japanese law enforcement, who teamed up to track this virtual cash. Criminals should take note: You cannot rely on cyptocurrency to hide your ill-gotten gains from law enforcement. The United States coordinates extensively with its international partners to forestall crime and retrieve stolen funds.” Grossman thanked the prosecution team, the FBI and Japanese authorities for their excellent work on this case.

“The FBI was able to recover these stolen funds for two very important reasons,” said FBI Special Agent in Charge Suzanne Turner. “First, Sony and Citibank immediately contacted and cooperated with law enforcement as soon as the theft was detected, and the FBI worked in partnership with both to locate the funds. Second, the FBI’s footprint internationally through our Legal Attaché offices and the pre-existing relationships we have established in foreign countries – in this instance with Japan – enabled law enforcement to coordinate and identify the subject. The FBI’s technical expertise was able to trace the money to the subject’s crypto wallet and seize those funds.”

The Major Frauds and Public Corruption Section and Asset Recovery Section of the U.S. Attorney’s Office for the Southern District of California is handling the proceedings, with significant assistance from the Department of Justice Criminal Division’s Money Laundering and Asset Recovery Section and Computer Crime and Intellectual Property Section. The Justice Department’s Office of International Affairs provided investigative assistance. The FBI continues to investigate the alleged crime.

Assistant U. S. Attorney Stephen H. Wong (619) 546-9464

NEWS RELEASE SUMMARY – December 20, 2021

SAN DIEGO – Nyika Gomez, a San Diego resident and former contract employee with the California Employment Development Department (EDD), was sentenced in federal court to 25 months in prison and ordered to pay $93,248 dollars in restitution in connection with a scheme to submit fraudulent pandemic unemployment insurance claims for California state prisoners.

As part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act of 2020, Congress provided new unemployment benefits for those affected by the COVID-19 pandemic who would not otherwise qualify for unemployment insurance. In California, the EDD administers unemployment insurance benefits. In Arizona, benefits are administered by the Arizona Department for Economic Security (AZDES).

Gomez was sentenced on December 15. According to her plea agreement, in July 2020, Gomez devised a scheme to defraud the EDD and AZDES by submitting Pandemic Unemployment Assistance claims for prisoners and other persons who were not eligible for such assistance, including making up false claims about their employment. Gomez submitted more than $214,344 in fraudulent claims and collected $93,248 on those claims. Gomez arranged for the stolen benefits – paid out in the form of a debit card – to be mailed directly to her residence, or to the residence of someone working with her. Gomez returned some of the proceeds to the prison inmates by transferring money to their prison accounts and kept some of the proceeds for herself.

The charges are the product of an investigation jointly undertaken by the U.S. Department of Labor, Office of the Inspector General (DOL-OIG), the California Employment Development Department Office of Investigations (EDD OI), United States Postal Inspection Service (USPIS), and Homeland Security Investigations (HSI).

“Pandemic unemployment insurance programs are designed to support workers who are suffering financial hardship during this unprecedented time,” said Acting U.S. Attorney Randy Grossman. “This defendant was supposed to help unemployed workers. Instead, she cut a hole in their safety net, and she has been be held to account for her greedy actions.” Grossman thanked the prosecution team and the state and federal  investigators for their excellent work on this case.

If you think you are a victim of COVID-19 fraud, immediately report it the FBI (visit ic3.gov, tips.fbi.gov, or call 1-800-CALL-FBI or the San Diego FBI at 858-320-1800.

In addition, the public is urged to report suspected fraud schemes related to COVID-19 by calling the National Center for Disaster Fraud (NCDF) hotline (1-866-720-5721) or by e-mailing the NCDF at [email protected].

DEFENDANTS                                 Case Number 20-CR-729-CAB

Nyika Gomez                                     Age: 31                            San Diego, CA

SUMMARY OF CHARGES

Count 5: Title 18, United States Code, section 1343 (wire fraud)

Maximum penalty: Twenty years in prison; fine; penalty assessment

Count 12: Title 18, United States Code, section 1028A; (aggravated identity theft)

Maximum penalty: Two-year mandatory minimum term of imprisonment, consecutive to any term of imprisonment imposed for Counts 1 through 9.

AGENCIES

U.S. Department of Labor, Office of the Inspector General

California Employment Development Department Office of Investigations

California Department of Corrections and Rehabilitation-Investigative Services Unit

United States Postal Inspection Service

Homeland Security Investigations

Assistant U. S. Attorney Shane Harrigan (619) 546-6981 and Fred Sheppard (619) 546-8237   

NEWS RELEASE SUMMARY – December 17, 2021

SAN DIEGO – Abdullahi Ahmed Abdullahi, a Canadian national and former resident of San Diego, pleaded guilty in federal court today, admitting that he conspired with others to provide material support to terrorists engaged in violent activities such as murder, kidnapping and maiming of persons in Syria.

According to his plea agreement, Abdullahi admitted that he provided money to his four cousins, including an 18-year old Minneapolis resident, as well as former San Diego resident Douglas McAuthur McCain, to support their terrorist activities in Syria.

From November 2013 through March 2014, with financial assistance from Abdullahi for the purchase of airline tickets and subsistence abroad, Douglas and the others traveled from the San Diego and Minneapolis and Edmonton, Canada to Syria, where they joined the Islamic State of Iraq and Syria (ISIS), a foreign terrorist organization, and engaged in armed battles to gain control of the territories and civilian populations within Syria on behalf of ISIS. All five individuals were subsequently reportedly killed fighting for ISIS. 

Douglas McCain, a former San Diego resident, is the first known American to die fighting for ISIS. He departed from San Diego in March 2014, and on or about August 25, 2014, he was reportedly killed fighting for ISIS against Free Syrian Army forces. Douglas’ brother, Marchello McCain, was previously convicted in San Diego federal court and sentenced to 10 years in custody for illegal possession of a cache of firearms and providing false statements to FBI agents regarding his knowledge of the conspiracy, including the involvement of Abdullahi. 

Pursuant to the plea agreement, Abdullahi also admitted that in order to finance the travel of others to Syria, members of the conspiracy encouraged Abdullahi and others to steal and commit fraud against the “kuffar” (a pejorative term used to describe non-Muslims), claiming that such criminal activity was permissible under Islamic law.

Abdullahi admitted that on January 9, 2014, he committed an armed robbery of an Edmonton jewelry store for the purpose of raising funds to support terrorist activities in Syria. Thereafter, on three occasions, Abdullahi wired and caused others to wire money to other members of the conspiracy in the United States -- including approximately $3,100 to Douglas – in order to finance the travel of foreign fighters from North America to support and join terrorist fighters engaged in terrorist activities in Syria.

Additionally, Abdullahi admitted that he and others wired and caused money to be wired to third-party intermediaries in Gaziantep, Turkey (located approximately 40 miles from the Syrian border) for the purpose of supporting member of the conspiracy fighting and engaging in terrorist activity in Syria.

According to the plea agreement, Abdullahi has agreed to a term of imprisonment of 20 years.

“Terrorist networks can’t survive without people like Abdullahi,” said U.S. Attorney Randy Grossman. “Our top priority is protecting Americans from terrorists, and with today’s guilty plea, we have delivered justice to someone who directly funded violence. I want to commend FBI San Diego and all of the federal, state and local law enforcement partners at the San Diego Joint Terrorism Task Force for their hard work and dedication to the multi-year, complex investigation that led to today’s guilty plea. Additionally, I am also extremely grateful for the assistance of the Department of Justice’s Office of International Affairs and our Canadian law enforcement partners, including the Royal Canadian Mounted Police; Edmonton Police Services; the Alberta Crown Prosecution Service; the Public Prosecution Service of Canada; and the Canada Crown Prosecutor’s Office, all of whom have been instrumental in the United States’ efforts to prosecute Abdullahi and combat international terrorism.”

“The defendant committed violent, criminal acts to obtain money to help fund Douglas McCain’s travel overseas to fight for ISIS, where McCain was ultimately killed,” said FBI Special Agent in Charge Suzanne Turner. “This case demonstrates the FBI’s dedication to vigorously pursue those who provide material support to terrorist organizations, financial or otherwise, and hold them accountable for those conspiratorial actions.”

On September 15, 2017, pursuant to an extradition request by the United States, Canadian authorities arrested Abdullahi. Abdullahi was detained in Canadian custody without bail, pending extradition. On October 24, 2019, Canada extradited Abdullahi to San Diego to face the material support charges in the Indictment. 

DEFENDANT                                               Criminal Case No. 17CR0622-W

Abdullahi Ahmed Abdullahi                          Age 33             Edmonton, Alberta, Canada  

SUMMARY OF CHARGES

Conspiracy to Provide Material Support to Terrorists – Title 18, U.S.C., Sections 2339A(a)

Maximum penalty: Fifteen years in prison and $250,000 fine (per count)

Providing Material Support to Terrorists – Title 18, U.S.C., Sections 2339A(a)

Maximum penalty: Fifteen years in prison and $250,000 fine

INVESTIGATING AGENCIES

San Diego Joint Terrorism Task Force

Federal Bureau of Investigation

Federal Air Marshal Service

Department of Homeland Security, Homeland Security Investigations

Department of Homeland Security, U.S. Border Patrol

News Release Summary – December 15, 2021

San Diego – United States Coast Guard Commandant Admiral Karl Schultz has awarded former U.S. Attorney Robert S. Brewer, Jr. with the Distinguished Public Service Award, the agency’s highest public recognition, other than the gold and silver lifesaving medals.  Today, on behalf of the Commandant, Rear Admiral Brian Penoyer, the agency’s District Eleven Commander, presented the award, which was bestowed in recognition of Brewer’s “outstanding advancement of the Coast Guard's law enforcement mission as the United States Attorney for the Southern District of California from 2019 to 2021.”

The award recognizes that under Brewer’s leadership, the Southern District of California “strengthened its comprehensive maritime counter-narcotics program to significantly disrupt the flow of narcotics and human smuggling in the California Coastal Region and the Eastern Pacific,” noting that on April 1st, 2020, the United States Southern Command began enhanced counter-narcotics operations in the Western hemisphere to disrupt the increasing flow of drugs. The award credits Brewer with spearheading the prosecution of many cases resulting from these interdictions and promoting the safety and security of the United States” through “the conviction of six defendants in two jury trials, the prosecution of twenty low profile and go fast vessels, and the arrest of key land-side organizers in Central and South America,” which “effectively stymied the flow of maritime smuggling and delivered a major setback to numerous drug trafficking organizations.”

The award notes that Brewer was responsible for leveraging “long-term proactive maritime investigations and inter-agency partnerships to launch a concerted effort to target and dismantle maritime Transnational Criminal Organizations,” using Coast Guard Eastern Pacific interdictions as the cornerstone of an innovative legal approach to pursue and eradicate these organizations.  It asserts that “Brewer’s commitment to securing resources was vital for indicting 125 high level narcotics targets, seizing 45 metric tons of cocaine and $4.5M of bulk cash, and dismantling major Transnational Criminal Organizations in Colombia, Ecuador, and Guatemala.”

Acting U.S. Attorney Grossman opened today’s ceremony by thanking the U.S. Coast Guard, which has become an increasingly important law enforcement partner in the Southern District’s ongoing fight against drug and human smuggling.  “This is a truly fitting award for Bob, who has devoted so much of his life to public service in many ways – as an Army Ranger and war hero, as a Deputy District Attorney, then as an Assistant United States Attorney, and ultimately a United States Attorney,” Grossman said.  “Bob prioritized our partnership with the U.S. Coast Guard, expanded our prosecutions of the agency’s drug interdictions, and effectively focused resources on proactive investigations designed to disrupt and dismantle transnational criminal organizations.”

At the ceremony, Brewer relayed his deep respect for the work of the U.S. Coast Guard, stating that his work with the agency “was a true highlight of my tenure as U.S. Attorney.” Brewer described the moving christening of the 32nd fast response cutter (FRC), Benjamin Bottoms and the offloading of massive major narcotics interdictions as significant moments reflecting the agencies’ strong partnership. “I am tremendously honored and grateful to be recognized by the Commandant,” Brewer said. “This very special award is really a reflection on the entire U.S. Attorney’s Office for the Southern District of California. It is a tribute to the hard work of the dedicated and innovative team that made these prosecutions possible.”

Former Chief Judge Irma Gonzalez (retired), Mr. Brewer’s spouse, attended the ceremony, accompanied by current Chief District Court Judge Dana Sabraw, Magistrate Judge Andy Schopler, Acting U.S. Attorney Randy Grossman, several USAO supervisors and U.S. Coast Guard Captain Timothy Barelli, the Commander of Sector San Diego.

 

NEWS RELEASE SUMMARY – December 15, 2021

SAN DIEGO – U.S. District Judge Janis L. Sammartino has ruled that all rights to videos and images produced in the GirlsDoPorn and GirlsDoToys sex trafficking case be awarded to the hundreds of victims who are featured in the footage posted to the adult websites.

Judge Sammartino issued the ruling as part of a restitution order in the prosecution of Ruben Andre Garcia, an adult film performer and producer who was sentenced to 20 years in prison for conspiring with the owners of the GirlsDoPorn (GDP) and GirlsDoToys (GDT) adult websites to recruit young women to appear in the sex videos using force, fraud, and coercion.

In addition to granting the rights to the videos and images to the victims, Judge Sammartino ordered Garcia to pay approximately $18 million in restitution to the victims.

To address the problem that hundreds of victims in this case have been and continue to be victimized by the posting and viewing of their GDP and GDT images and videos, Judge Sammartino outlined the following conditions:

- Garcia, aka “Jonathan,” has no right to use, publish, or otherwise exploit GirlsDoPorn (GDP) or GirlsDoToys (GDT) images, likenesses, or videos;

- All purported model releases and other agreements between GDP and/or GDT and its models purporting to give GDP and/or GDT the right to use, publish, or otherwise exploit its models’ images, likenesses, or videos are void and unenforceable;

- All transfers, licenses, or leases of the right to use, publish, or otherwise exploit the models’ images, likenesses, or videos by GDP and/or GDT to any third parties are void;

- Each model holds superior right, title, and interest in the images, likenesses, and videos depicting that model produced by GDP and/or GDT; and

- Each model shall have and recover all property that GDP and/or GDT took from them, including images, likenesses, videos, and copyrights.

“This is an extremely important ruling that returns power to the victims by giving them control of the images and videos that caused them so much pain and suffering,” said Acting U.S. Attorney Randy Grossman. “We hope this helps the victims close a difficult chapter in their lives.” Grossman thanked the prosecution team and the FBI for the relentless pursuit of justice in this case.

“An important step in this long healing process is for the victims to be able to take back control of their lives,” said FBI Special Agent in Charge Suzanne Turner. “This ruling helps to facilitate that shift while the FBI aggressively pursues the lone outstanding fugitive in this case - and its ringleader - Michael James Pratt.”

According to court documents, Garcia admitted that beginning in approximately 2013 and continuing up to October 2019, Michael James Pratt, Matthew Isaac Wolfe, Ruben Andre Garcia, Theodore Wilfred Gyi, Valerie Moser, and others, allegedly participated in a scheme to recruit victims to engage in commercial sex acts using force, fraud, and coercion.

To recruit victims to appear in videos for the websites, the defendants lied to the victims and told them that the videos would never be posted on-line, that the videos would never be released in the United States, and that no one who knew the women would ever find out about the videos, representations that the defendants knew were false. Hundreds of women from cities throughout the United States and Canada were recruited to appear in videos based upon these material misrepresentations. The defendants illegally obtained the images and videos of the victims using force, fraud, and coercion.

The victims’ sex acts were posted on the GDP and GDT websites. GDP and GDT charged visitors a subscription fee to access the websites’ content. The GDP and GDT websites generated at least $17 million in revenue for its owners.

Throughout the conspiracy, GDP and GDT received millions of views. To promote the websites, video content from both sites was posted on free porn sites such as Pornhub.com, one of the world’s most visited websites. The snippets of videos from GDP and GDT posted on Pornhub.com were often viewed millions of times, according to Pornhub’s view counters.

The next hearing in the ongoing case is March 11, 2022, at 2 p.m. for motions as to defendant Mathew Wolfe, whose trial is slated to begin June 20, 2022.

Any victims seeking the right to enforce this order and any additional victims of these alleged crimes are encouraged to call the FBI at 1-800-CALL-FBI or go to https://tips.fbi.gov/

The FBI is offering a reward of up to $50,000 for information leading to the arrest of Michael James Pratt. Individuals with information about Pratt should contact their local FBI office or the nearest American Embassy or Consulate.

For further information, please see:

• Wanted Poster: MICHAEL JAMES PRATT — FBI
• Press Release: FBI Seeking Public’s Assistance to Locate Michael James Pratt, Wanted for Sex Trafficking and Production of Child Pornography — FBI

DEFENDANTS                                            Case Number 19cr4488-JLS                                   

Michael James Pratt                                       Age:     36                    Fugitive

Matthew Isaac Wolfe                                      Age     37                   San Diego, CA

Theodore Gyi                                                 Age:     42                    Rancho Aliso, CA**

Valorie Moser                                                 Age:    38                    San Diego, CA**

SUMMARY OF CHARGES

Count 1 (charging all defendants)

Conspiracy to Commit Sex Trafficking by Force, Fraud and Coercion, 18 U.S.C. § 1591(a) and (b)(1)

Maximum Penalty: Life in prison, $250,000 fine, and a special assessment of $5,000 under 18 U.S.C. § 3014.

Count 2 (Pratt)

Production of Child Pornography, 18 U.S.C. § 2251(a) and (e)

Maximum penalty: Thirty years in prison with mandatory minimum 15 years; $250,000 fine, and a special assessment of $5,000 under 18 U.S.C. § 3014.

Count 3 (Pratt)

Sex Trafficking of a Minor by Force, Fraud and Coercion, 18 U.S.C. § 1591(a)(1) and (2)

Maximum penalty: Life in prison, mandatory minimum 15 years; $250,000 fine, and a special assessment of $5,000 under 18 U.S.C. § 3014.

Counts 4 (Pratt, Wolfe, Garcia), 5 (Pratt, Garcia), 6 (Pratt, Wolfe, Garcia), 7 (Pratt, Garcia, Gyi), 8 (Pratt, Garcia, Gyi)

Conspiracy to Commit Sex Trafficking by Force, Fraud and Coercion, 18 U.S.C. § 1594

Maximum penalty: Life in prison, mandatory minimum 15 years; $250,000 fine, and a special assessment of $5,000 under 18 U.S.C. § 3014.

INVESTIGATING AGENCY

FBI

*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.

Assistant U. S. Attorney Andrew J. Galvin (619) 546-9721    

NEWS RELEASE SUMMARY – December 14, 2021

SAN DIEGO – A indictment unsealed today charges San Diego resident Denny Bhakta with securities fraud and money laundering for running an investment fraud scheme that took in at least $28 million from investors since 2016.    

According to court documents and statements made in court, Bhakta solicited investments in his companies, Fusion Hotel Management, LLC and Fusion Hospitality Corporation (collectively “Fusion”). Bhakta falsely told investors that Fusion routinely acquired discounted blocks of hotel rooms from Hilton, which Fusion then sold to United Airlines at a higher price for a significant profit. Instead of buying blocks of hotel rooms with investors’ funds, however, Bhakta used the money for personal expenses and to make payments to other investors.

The indictment alleges that Bhakta provided investors with fabricated documents, including bank records that purported to show payments from Fusion to Hilton and fake agreements between Fusion and United Airlines.  These documents gave the false appearance that Fusion bought large blocks of hotel rooms from Hilton and sold them to United Airlines. According to statements made in court, Bhakta laundered the proceeds of his fraud scheme by using investor funds from Fusion’s bank accounts at various casinos, including the ARIA Resort & Casino and The Cosmopolitan of Las Vegas. 

Bhakta was arrested at his San Diego residence on Tuesday morning.

“We will do everything we can to protect investors and to seek justice when they fall victim to scammers,” said Acting U.S. Attorney Randy Grossman. “Investors, be suspicious of high-pressure sales tactics, promises of returns that are too good to be true, and always verify the license and legitimacy of the person making the pitch.” Grossman thanked the prosecution team and the FBI for their excellent work on this case.

“The defendant allegedly spent the last five years making millions of dollars based on false promises supported by fraudulent financial statements and fake business agreements,” said FBI Special Agent in Charge Suzanne Turner. “This case should serve as a warning – the FBI will continue to partner with the U. S. Securities and Exchange Commission to root out all forms of investment fraud.” 

The next hearing is scheduled for January 21 at 1:30 p.m. 

DEFENDANT                                               Case Number 21-CR-3352-JLS                                           

Denny Bhakta                                                 Age: 39                                   San Diego, CA

SUMMARY OF CHARGES

Securities Fraud – Title 15, U.S.C., Sections 78j(b), 78ff, and Title 17, C.F.R., Section 240.10b-5

Money Laundering – Title 18, U.S.C., Section 1957

Maximum penalty: Twenty years in prison

AGENCY

Federal Bureau of Investigation

Securities and Exchange Commission

*The charges and allegations contained in an indictment are merely accusations, and the defendant is considered innocent unless and until proven guilty.

Assistant U. S. Attorneys Colin M. McDonald (619) 546-9144 and Victor P. White (619) 546-8439

NEWS RELEASE SUMMARY – December 13, 2021

SAN DIEGO – Victor Alfonso Soto Aguilar and Jose Ramon Geraldo Romero were sentenced in federal court today to 71 and 60 months in prison, respectively, for attempting to smuggle fourteen Mexican citizens into the United States by sea, resulting in the tragic drowning death of a 43-year-old passenger.

Court records show that on May 19, 2021, Soto Aguilar and Geraldo Romero agreed to smuggle a group of undocumented individuals on a panga boat from Ensenada, Mexico to the shores of La Jolla, California—a distance nearing 100 miles. The smuggling venture encountered issues from the start. Due to engine trouble, the panga—which was significantly overloaded—stalled in the middle of open ocean waters. As a result, the group was forced to spend the night in the panga without adequate food or water. Soto Aguilar and Geraldo Romero then dropped their passengers on an island in the middle of the ocean while they tried to repair the panga. After making repairs, Soto Aguilar and Geraldo Romero retrieved the passengers from the island and proceeded to navigate the panga north towards La Jolla.

On May 20, 2021, in the early morning hours, the panga neared the shores of La Jolla by Marine Street beach. When the panga was approximately eighty yards from shore, Soto Aguilar and Geraldo Romero—not knowing if anyone could swim—instructed the passengers to remove their life jackets and jump into the water, assuring them the water was shallow. 

Twelve passengers did as they were told. Immediately they struggled to stay afloat and desperately started calling for help. The two passengers that remained on the panga saw their fellow passengers struggling and tossed life jackets into the ocean. Soto Aguilar and Geraldo Romero then saw a lifeless body floating in the water. After pulling the body into the panga, Soto Aguilar and Geraldo Romero sped the boat away from the group in the water towards another beach about a half-mile away. After landing there, Soto Aguilar and Geraldo Romero then left the panga and fled the scene. However, after some searching by law enforcement, they were apprehended nearby.

As law enforcement was securing the crime scene, a concerned citizen spotted an individual floating in the water near the beached panga. Responding officers immediately rushed to the individual’s aid, extricated him from the water, and quickly realized he was unconscious. A Border Patrol agent performed CPR in an attempt to revive the individual, but he was pronounced dead once lifeguards arrived on scene. The decedent was later identified as Rogelio Perez-Gutierrez, a 43-year-old citizen of Mexico.

At the original drop-off location, United States Border Patrol, the United States Coast Guard, and San Diego Lifeguards spotted the individuals struggling desperately in the ocean. Lifeguards ultimately rescued ten people out of the water. In later interviews, the passengers on the panga said they were paying between $12,000 and $15,000 to be brought into the United States; they stated they feared for their lives throughout the ocean journey.

At the sentencing hearing, U.S. District Judge John Houston spoke about the “extraordinary danger” of smuggling on the high seas. Speaking of the gravity of the crime, Judge Houston said, “A human being is not here because of the risk you were willing to take.” He further urged the defendants to “[t]ell the people in Mexico that to captain or assist in driving a boat on the high seas will create a significant sentence.”

“This was a tragedy that never should have happened,” said Acting U.S. Attorney Randy Grossman. “These deadly smuggling incidents are on the rise. We will aggressively seek justice for the victims. But we also urge anyone who is contemplating an attempt to cross the border illegally: Don’t do it. Don’t put your life in the hands of greedy smugglers who care about money, not you.”  Grossman commended the excellent work of the prosecution team as well as the HSI agents, Coast Guard officers, Border Patrol agents, and San Diego Lifeguards, for their efforts in connection with the case.

“The U.S. Border Patrol will continue to seek maximum prosecution of individuals who smuggle at sea,” said San Diego Sector’s Chief Patrol Agent Aaron Heitke. “This incredibly dangerous and unpredictable tactic has already claimed lives, yet smuggling organizations continue to enrich themselves by using it.”

DEFENDANTS                                                         Case Number 21cr1665-JAH                                  

Victor Alfonso Soto Aguilar                          Age: 37                       Residence: Mexico

Jose Ramon Geraldo Romero                         Age: 24                       Residence: Mexico

SUMMARY OF CHARGES

8 U.S.C. § 1324(a)(1)(A)(i) and (B)(iv) - Attempted Bringing In Illegal Aliens Resulting in Death

Maximum penalty: Death or imprisonment for any term of years or for life; $250,000 fine.

8 U.S.C. § 1324(a)(2)(B)(ii) - Attempted Bringing In Illegal Aliens for Financial Gain (three counts)

Maximum penalty: mandatory minimum five years’ imprisonment; maximum fifteen years; $250,000 fine

AGENCIES

Homeland Security Investigations

United States Coast Guard

San Diego Lifeguards

United States Border Patrol

Customs and Border Protection

The U.S. Attorney’s Office for the Southern District of California helps lead Joint Task Force Alpha (JTFA), which was established by Attorney General Merrick B. Garland in June 2021 to marshal the investigative and prosecutorial resources of the Department of Justice, in partnership with the Department of Homeland Security (DHS), to enhance U.S. enforcement efforts against the most prolific and dangerous human smuggling and trafficking groups operating in Mexico and the Northern Triangle countries of Guatemala, El Salvador, and Honduras.  The Task Force focuses on disrupting and dismantling smuggling and trafficking networks that abuse, exploit, or endanger migrants, pose national security threats, and are involved in organized crime. JTFA consists of federal prosecutors and attorneys from U.S. Attorney’s Offices along the Southwest Border (District of Arizona, Southern District of California, Southern District of Texas, and Western District of Texas), from the Criminal Division and the Civil Rights Division, along with law enforcement agents and analysts from DHS’s Immigration and Customs Enforcement, Customs and Border Protection, and Border Patrol.  The FBI and the Drug Enforcement Administration are also part of the Task Force.  

Assistant U. S. Attorney Charlotte E. Kaiser (619) 546-7282 

NEWS RELEASE SUMMARY – December 10, 2021

SAN DIEGO – Rito Rios-Quinones of Chihuahua, Mexico, was sentenced in federal court today to two years in prison for smuggling five migrants across treacherous terrain along the U.S.-Mexico border. It was the same route used by his brothers, Cecilio and Ricardo Rios-Quinones, who were convicted in connection with an ill-fated smuggling event that resulted in the deaths of three sisters in February 2020.

Rito Rios-Quinones pleaded guilty in March 2021 to Bringing in Aliens for Financial Gain and Aiding and Abetting.  As part of his plea agreement, Rios admitted that he and his brothers worked for a human smuggling organization. He agreed to learn the smuggling routes, be paid to serve as a foot guide and teach other foot guides the routes.

Rios further admitted that he trained his brother Ricardo on the smuggling route a few days before the February 10, 2020 event that resulted in the deaths of sisters Juana Santos Arce, Margarita Santos Arce and Paula Santos Arce of Oaxaca, Mexico.

On that day, agents from the Border Patrol’s Search, Trauma and Rescue (BORSTAR) unit, along with Border Patrol agents from the Campo-Boulevard area and rescue personnel from the City of San Diego Fire & Rescue Department placed their own lives at risk during a rescue operation of Cecilio and Rito Rios-Quinones and attempted rescue of the sisters, whom Cecilio and Ricardo were guiding along the route.  All three women died of hypothermia.   Subsequently, Cecilio and Ricardo Rios-Quinones pleaded guilty to Transportation of Aliens Resulting in Death, among other charges, and were each sentenced on April 2, 2020, to 66 months in custody. 

In today’s case, Rito Rios-Quinones admitted in his plea agreement that he knew his brothers smuggled these three women along this route and that the three women died during the smuggling event. Despite this knowledge, on or about November 3, 2020, Rito Rios-Quinones was apprehended for smuggling five other migrants along this same route for the same smuggling organization. The migrants were going to pay or have others pay on their behalf $7,000 to $8,000 to the organization to be smuggling into the United States.

“This defendant knew about the tragic deaths along this smuggling route, and yet he still attempted the perilous journey, failing to make sure these victims had the proper clothing, supplies or equipment to make it,” said Acting U.S. Attorney Randy Grossman. “These are callous acts of greed. Smugglers, we will find a way to identify you and prosecute you to the fullest extent of the law. Migrants, don’t put your lives in the hands of people with absolutely no regard for your safety.” Grossman thanked the prosecution team and agents from Border Patrol and Homeland Security Investigations for their excellent work in this case.

“Human smuggling organizations enrich themselves while endangering the lives of those they smuggle,” said Border Patrol’s Chief Patrol Agent Aaron Heitke. “We are grateful for the tenacity, persistence, and hard work that our law enforcement partners have demonstrated in this case. Collaboratively, our efforts have resulted in Rios-Quinones’ arrest, conviction, and just sentencing.”

“The actions of this individual are another example of the complete disregard human smugglers have for the people who pay them,” said HSI San Diego Special Agent in Charge Chad Plantz. “Anyone considering making the perilous journey across the border with smugglers should know that they place their lives in extreme danger because these transnational criminal organizations only value the profits from their illegal enterprise. HSI, along with its law enforcement partners will continue to bring to justice individuals like Rios-Quinones who place greed and profit before human life.”

DEFENDANT                                               Case Number 19cr0868-CAB                                        

Rito Rios-Quinones                                        Age: 33                                  Chihuahua, Mexico

SUMMARY OF CHARGES

Bringing in Aliens for Financial Gain and Aiding and Abetting– Title 8, U.S.C., Section 1324(a)(2)(B)(ii) and Title 8, U.S.C., Section 2

Maximum penalty: Ten years in prison, and $250,000 fine.

AGENCIES

U.S. Border Patrol, Intelligence Unit

Homeland Security Investigations

Senior Litigation Counsel and Community Outreach Director Cindy Cipriani (619) 546-9608

NEWS RELEASE SUMMARY – December 10, 2021

SAN DIEGO – The Department of Justice announced today that it has awarded more than $17.5 million in grants to support the Project Safe Neighborhoods (PSN) Program. Funding will support efforts across the country to address violent crime, including the gun violence that is often at its core. The Southern District of California was awarded $185,384.

The Bureau of Justice Assistance (BJA), part of the department’s Office of Justice Programs (OJP), will administer the 88 grant awards, which are being made to designated fiscal agents to support local PSN projects that work in partnership with U.S. Attorneys’ Offices.  The San Diego Association of Governments (SANDAG) is the fiscal agent for the Southern District of California.

“This latest Project Safe Neighborhoods grant is critical to addressing the violent crime threatening cities and towns all across our country,” said Deputy Attorney General Lisa O. Monaco. “Ensuring the safety of all Americans is the highest priority for the Department of Justice, but when it comes to violent crime, there is not a one-size-fits-all solution. We have to work closely with local public safety agencies as well as community organizations to craft individual strategies unique to each community’s needs. Programs like Project Safe Neighborhoods and the funding it provides allow us to do just that.”

“Through Project Safe Neighborhoods, a broad spectrum of stakeholders works together to identify the most pressing violent crime problems in the community and develops comprehensive prosecution and community outreach solutions to address them,” said Acting U.S. Attorney Randy Grossman. “Our grants have been distributed to local law enforcement and community organizations to prevent gun violence, facilitate reentry, reduce gang membership and other important programs. This money is an investment in public safety.”

In the current round of funding, the Southern District of California PSN Task Force plans to fund violent crime law enforcement efforts and nonprofit agencies that focus on gang prevention, violence intervention, and facilitating successful reentry into the community from custody.  The District’s PSN awards over the past two years have funded enforcement of red flag laws, youth mentoring, credible messenger programs, and research into ways to measure the success and bolster the capacity of lived experience mentoring. 

“Investing in our communities, supporting victims and building a justice system that both keeps people safe and earns their trust – these are mutually reinforcing goals that stand at the heart of Project Safe Neighborhoods,” said Principal Deputy Assistant Attorney General Amy L. Solomon for OJP. “The Office of Justice Programs is pleased to join with our U.S. Attorneys’ Offices, and with jurisdictions across the country, as we work together to meet the challenges of crime and violence and achieve our shared aspirations of public safety and community trust.”

In May 2021, Attorney General Merrick B. Garland announced a new effort to reduce violent crime, including the gun violence that is often at its core. Integral to that effort was the reinvigoration of PSN, a two-decade old evidence-based and community-oriented program focused on reducing violent crime. The updated PSN approach, outlined in the department’s Comprehensive Strategy for Reducing Violent Crime issued by Deputy Attorney General Monaco, is guided by four key principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence, setting focused and strategic enforcement priorities and measuring the results of our efforts. The fundamental goal is to reduce violent crime, not simply to increase the number of arrests or prosecutions.

This fall, U.S. Attorney’s Offices across the country have enhanced their violent crime reduction efforts to ensure alignment with the department’s comprehensive violent crime reduction strategy. U.S. Attorneys’ Offices have engaged in outreach to law enforcement and other agencies and organizations serving communities to identify the most significant drivers of violence in their districts. Working together with a broad coalition of stakeholders, the U.S. Attorneys’ Offices are addressing the most pressing violent crime issues in their district to make our neighborhoods safer for all.

PSN programs are led by U.S. Attorneys’ Offices in collaboration with local public safety agencies, community stakeholders and other agencies and organizations that work to reduce violent crime.

For a list of all grantees, please visit: https://www.ojp.gov/sites/g/files/xyckuh241/files/media/document/FY21-Project-Safe-Neighborhoods-Awards.pdf.

Information about these and other FY 2021 grant awards from the Office of Justice Programs can be found online at the OJP Grant Awards Page.

The Office of Justice Programs provides federal leadership, grants, training, technical assistance and other resources to improve the nation’s capacity to prevent and reduce crime, advance racial equity in the administration of justice, assist victims and enhance the rule of law. More information about OJP and its components can be found at www.ojp.gov

Assistant U. S. Attorney Andrew J. Galvin (619) 546-9721

NEWS RELEASE SUMMARY – December 10, 2021

SAN DIEGO – Jason Harrington was sentenced in federal court today to 36 months in prison for selling $1.1 million of forged art he claimed was created by Richard Hambleton, a New York City artist who rose to fame in the 1980s.

When he pleaded guilty in August 2021, Harrington admitted selling forged art to at least 15 galleries and individuals between 2018 and 2020. The forged art included paintings of a black-silhouetted figure known as the Shadowman, which was a recurring motif in Hambleton's works.

To make the forged art appear authentic, Harrington lied to prospective buyers regarding the provenance of the art. To support these false statements, Harrington provided prospective buyers with a fake letter purportedly signed by the individual who obtained the art and, on one occasion, instructed an individual to speak with a prospective buyer and falsely claim to have obtained the art from Hambleton. According to court records, Harrington altered images, using publicly available photographs of Hambleton, to make it appear that the individual who purportedly obtained the art knew Hambleton.

Harrington also admitted to attempting to sell at least one forged painting purporting to be from the noted portraitist Barkley Hendricks. According to court records, Harrington falsely claimed to the owner of an art gallery that he inherited the painting from his uncle. The art gallery, however, refused to purchase the painting after Hendricks’ widow viewed the painting and determined it was a forgery.

“This is a fitting sentence for a defendant who harmed investors, corrupted the integrity of the art market, and damaged the historical-cultural record,” said Acting U.S. Attorney Randy Grossman. Grossman thanked the prosecution team and the FBI for their excellent work on this case.

“Today’s sentence demonstrates the FBI’s commitment in pursuing those who make a living victimizing others,” said FBI Special Agent in Charge Suzanne Turner. “Mr. Harrington knowingly and willfully operated in the world of forged art and today found out the cost for those criminal acts. These types of crimes not only hurt the victims who purchased the artwork, they cast a shadow over the art community as a whole - particularly those forged artists’ names he used to further his scheme.”   

Harrington will appear for a restitution hearing on February 11, 2022 before U.S. District Judge Janis L. Sammartino.

DEFENDANT                                               Case Number 21-CR-1184-JLS                                           

Jason Harrington                                             Age: 38                                   Escondido, CA

SUMMARY OF CHARGES

Wire Fraud – Title 18, U.S.C., Section 1343

Maximum penalty: Twenty years in prison and $250,000 fine

AGENCY

Federal Bureau of Investigation

Assistant U. S. Attorneys Dylan M. Aste (619) 546-7621 and Valerie H. Chu (619) 546-6750

NEWS RELEASE SUMMARY – December 6, 2021

SAN DIEGO – Anthony Medrano, a veteran of the U.S. Marine Corps and former employee of the Veterans Administration, was sentenced in federal court today to eight months in custody for defrauding the Department of Veterans Affairs out of more than $183,000. 

According to his plea agreement, Medrano admitted that between approximately November 2015 and May 2020, he submitted claims to the Veterans Administration (VA) in which he purported to be disabled so that he could obtain caregiver benefits for his wife, when he was actually able-bodied and even participating in fitness challenges and coaching youth sports.

Medrano executed this scheme while employed in the VA’s Veterans Benefits Administration as a Veterans Service Representative, a position in which he explained benefit programs and entitlement criteria to veterans applying for VA benefits.  As a representative, Medrano’s responsibilities included adjudicating claims, authorizing payments, and inputting data necessary to generate the award and notification letter to the veteran. After the Veterans Benefits Administration authorizes payment, the Veterans Benefits Administration—a separate VA branch—administers the payment to disabled veterans who require substantial caregiving and need assistance to pay for such care.  Using the knowledge gained from his VA employment, Medrano stole $183,034.38 from the VA through a series of lies.

According to court documents, Medrano first lied during the physician evaluation conducted to determine eligibility in the Caregiver Support Program.  Medrano lied about needing high-level assistance for daily activities (e.g., dressing and undressing himself, personal hygiene, grooming), and he lied about needing high-level assistance in other activities (e.g., planning and organizing, recent memory, self-regulation). Medrano tricked the VA into awarding him assistance that paid the primary caregiver -his wife - an amount equivalent to a full-time home health aide’s 40-hour-per-week payment.

Medrano’s lies continued for years so that the money would keep coming in. Medrano told VA representatives that he was unemployed since 2012 and unable to work; his caregiver was “doing everything” for him, including washing his back while bathing. He said that he could not stand for more than 5-10 minutes; and he could not lift more than 20 pounds. But while Medrano was making those statements, he was employed, he was washing his own back, and was often lifting weights greater than 20 pounds while working out.

For example, immediately following an active-duty stint in the United States Marine Corps, the VA fully employed Medrano from March 2013 through February 19, 2021.  Medrano was also walking, jogging, and coaching youth sports teams while stating he could not stand for more than 5-10 minutes.  And only a few weeks after stating he could not lift more than 20 pounds, Medrano posted videos of himself on Facebook participating in the “push-up challenge,” doing push-ups with a 25-pound weight on his back. 

In court, prosecutor Dylan M. Aste noted that, due to his position, Medrano knew the inner workings of the VA’s approval requirements for disability benefits and used that insider information to exploit the VA system and steal $183,000 from the VA and disabled veterans in need of such benefits programs.

“This defendant used his position to game the system at the expense of those with legitimate claims and taxpayers in general,” said Acting U.S. Attorney Randy Grossman. “It’s not only outrageous when an undeserving person claims a disability. It’s also a crime.  And unfortunately for this defendant, he is going to jail.” Grossman thanked the prosecution team and the Department of Veterans Affairs, Office of Inspector General, for their excellent work on this case.

“Our nation’s service-disabled veterans receive a wide variety of benefits from the Department of Veterans Affairs. Unfortunately, some veterans fraudulently misrepresent their situation to obtain benefits they do not deserve,” said Special Agent in Charge Rebeccalynn Staples of the Department of Veterans Affairs Office of Inspector General’s Western Field Office. “The VA OIG remains committed to diligently pursuing these cases in an effort to maintain the integrity of VA programs.”

To report fraud in a VA program, call the VA-OIG hotline at 1-800-488-8244 or visit https://www.va.gov/oig/hotline/.

DEFENDANT                                                           Case Number 21cr01071-BAS                                

Anthony Medrano                                                       Age: 42                       Spring Valley, CA

SUMMARY OF CHARGES

Theft of Government Property – Title 18, U.S.C., Section 641

Maximum penalty: Ten years in prison and $500,000 fine

AGENCY

United States Department of Veteran’s Affairs, Office of the Inspector General 

 

Assistant U. S. Attorney Daniel Silva (619) 546-9713

NEWS RELEASE SUMMARY—December 3, 2021

SAN DIEGO ­– Global Gold Exchange, LLC and its managers, Richard M. Owen, James Warren, and Jeffrey Morrow, were sentenced in federal court today for committing multiple financial and firearms crimes, including laundering money through their unlicensed money transmitting business by falsely reporting transactions as “gold” and other precious metals.

Following entry of guilty pleas across 2019 and 2020, U.S. District Court Judge Cathy Ann Bencivengo sentenced each of the individual defendants to a term of incarceration. Owen received a custodial sentence of 24 months on his money laundering and felon-in-possession of firearm convictions. Warren and Morrow received custodial sentences of 6 and 8 months, respectively, on their convictions for operating an unlicensed money transmitting business.

As part of their sentences, the defendants agreed to forfeit approximately $2 million in assets involved in the money laundering and unlicensed money transmitting business, and further to provide restitution in the amount of no less than $3,682,063.44 for the crimes of money laundering, mail fraud, and operating an unlicensed money transmitting business. Each defendant is subject to a three-year term of supervised release following their custodial sentences.

Special Agents from IRS-Criminal Investigation’s Financial Investigations and Border Crimes Task Force worked with FBI agents and the United States Postal Inspection Service during the multi-year investigation to unravel millions of dollars in suspicious transactions taking place at the San Diego-based office and bank accounts of Global Gold Exchange, or “GGEX.”

Taken together, the defendants unlawfully laundered cash and funds from a variety of sources—both lawful and unlawful—and fraudulently documented the transactions as “a complete gold transaction.” Their crimes were best summed up in plea agreements that were previously entered by all four defendants, which admitted to operating GGEX “as an informal money transfer system engaged in facilitating the transfer of money domestically and internationally outside of the conventional financial institutions system, and did so without regard for the source, destination, purpose, or legality of the funds transmitted.”

Several victims addressed the court and the defendants, describing how they had “stolen our dignity,” “robbed us of peace of mind,” and “hurt people at a very deep level.” After reviewing the underlying facts of the case and handing down the sentences, Judge Bencivengo stated that the defendants’ crimes allowed people to “hide assets and improper transactions” while causing “irreparable harm” to the victims.

“Global Gold Exchange and its managers attempted to operate as a one-stop-shop for money laundering,” said Acting United States Attorney Randy S. Grossman. “The sentences handed down today make clear that the United States will pursue and prosecute any individual, asset, or business attempting to launder the proceeds of crimes, or that threaten the integrity of our financial system.”

Between 2017 and 2018, defendants GGEX, Owen, Warren, and Morrow employed various money laundering, fraud, and unlicensed money transmitting techniques to conduct unlawful transactions through GGEX and GGEX’s bank accounts, including transacting with a “local cartel out of Mexico;” falsifying invoices for sales of gold, when in reality it was the receipt of a large cash deposit, and returned by check after GGEX took a 10 percent fee; agreeing with “clients” to tell law enforcement or tax authorities that the transactions were sales/purchases of precious metals; and advising clients to mail GGEX parcels filled with heavy substances to mimic the weight of gold, all to falsely document the nature of GGEX’s transactions.

“Today’s sentences demonstrate IRS Criminal Investigation’s commitment to disrupting professional enablers, who facilitate the commission and concealment of financial crimes by veiling them behind legitimate business services,” said Special Agent in Charge Ryan L. Korner of the Los Angeles Field Office. “Targeting organizations such as Global Gold Exchange, LLC and its managers, who used their expertise of our financial systems to launder illicit funds, eliminates this avenue for criminal activity.”

“The FBI is proud to partner with IRS Criminal Investigations and the United States Postal Inspection Service to bring our collective authorities to bear in money laundering and fraud cases such as these,” said FBI Special Agent in Charge Suzanne Turner. “Today’s sentences should serve as a deterrent to those who seek to launder criminal proceeds by exploiting our financial system. The FBI and our federal partners will continue to bring all available resources to stop the flow of money to criminal organizations.”

“Today’s sentencing makes a statement to those who use the U.S. Mail to commit fraud,” stated Carroll N Harris, Postal Inspector in Charge of the Los Angeles Division, United States Postal Inspection Service. “Instead of seeing gold bars, these fraudsters will be behind prison bars. As always, Postal Inspectors remain committed to keeping the mail free from fraudulent mailings and will hold those that do accountable for their crimes.”   

This case is the result of ongoing efforts by the Financial Investigations and Border Crimes Task Force, a partnership targeting unlawful transactions through the financial system. The task force brings together the combined expertise of federal, state, and local law enforcement including IRS-CI, California Franchise Tax Board, United States Postal Inspection Service, and the San Diego Police Department. FBI and United States Postal Inspection Service partnered with the FIBC in this coordinated investigation, with assistance from the Bureau of Alcohol, Tobacco, Firearms and Explosives. This case is being prosecuted by Assistant U.S. Attorney Daniel Silva.

DEFENDANTS                                             Case Numbers: 19-CR-2936-CAB; 20-CR-3748-CAB                                             

Global Gold Exchange, LLC                                     

Richard M. Owen                                           San Diego, CA                        Age: 52

James Warren                                                 San Diego, CA                        Age: 50

Jeffrey Morrow                                               San Diego, CA                        Age: 46

SUMMARY OF COUNTS OF CONVICTION

Money Laundering – Title 18, U.S.C., Section 1956

Maximum penalty: Twenty years in prison and $500,000 fine

Operation of Unlicensed Money Transmitting Business – Title 18, U.S.C., Section 1960

Maximum penalty: Five years in prison and $250,000 fine

Mail Fraud – Title 18, U.S.C., Section 1341

Maximum penalty: Thirty years in prison and $1 million fine

Unlawful Possession of Firearm – Title 18, U.S.C., Section 922(g)

Maximum penalty: Ten years in prison and $250,000 fine

AGENCIES

IRS Criminal Investigation and the Financial Investigations and Border Crimes Task Force

Federal Bureau of Investigation

United States Postal Inspection Service

Assistant U. S. Attorney Meghan E. Heesch (619) 546-9442  

NEWS RELEASE SUMMARY – December 1, 2021

SAN DIEGO – Ernesto Renteria of Chula Vista was sentenced in federal court today to 71 months in custody for distributing more than 100 pounds of deadly fentanyl plus fentanyl analogues, cocaine and methamphetamine.

According to his plea agreement, in May 2021, Renteria stored large quantities of the federally controlled substances at his house in Chula Vista and was shipping them to distributors across the country via UPS.  In total, DEA agents seized from Renteria 49.1 kilograms (108.2 pounds) of fentanyl; 7 kilograms of cocaine; 4 kilograms of fentanyl analogue; and 1.8 kg methamphetamine. Agents also seized packaging materials and GPS tracking devices.

This seizure of fentanyl is yet another example of drug cartels pushing huge quantities of fentanyl into the San Diego community. On November 19, 2021, authorities at the Otay Mesa port of entry made a record-breaking seizure of 17,584 pounds of methamphetamine and 388.93 pounds of fentanyl from a commercial trailer attempting to enter the U.S. The driver of the vehicle, Carlos Martin Quintana-Arias, faces narcotics importation charges.

DEA agents across the country have seized a record-high 12,000 pounds of fentanyl this year.

“Fentanyl is an incredibly dangerous drug that is destroying lives and families in our community and across the nation,” said Acting U.S. Attorney Randy S. Grossman. “Our office will continue to aggressively prosecute those responsible for distributing this poison and profiting from the opioid epidemic.” Grossman praised the prosecution team and DEA agents for their excellent work on this case.

“The quantity of fentanyl DEA agents seized from Ernesto Renteria is disturbing,” said DEA Acting Special Agent in Charge Shelly S. Howe.  “Had DEA not seized these deadly drugs prior to distribution, many Americans could have died from a fentanyl overdose.  The DEA will continue to prioritize investigations targeting fentanyl drug traffickers to fight the growing number of overdose deaths in our country.”

Fentanyl analogues like the ones possessed by Renteria are particularly dangerous because the chemical structure can be manipulated to increase the potency. Since 2018, fentanyl analogues have been temporarily classified by the Drug Enforcement Administration as a Schedule I controlled substance. The temporary schedule expires in February 2022. In January 2020, all four U.S. Attorneys in California called on Congress to strengthen federal prosecutors’ toolkits by permanently scheduling all fentanyl analogues as Schedule I controlled substances.

This case is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) Strike Force Initiative, which provides for the establishment of permanent multi-agency task force teams that work side-by-side in the same location. This co-located model enables agents from different agencies to collaborate on intelligence-driven, multi-jurisdictional operations to disrupt and dismantle the most significant drug traffickers, money launderers, gangs, and transnational criminal organizations.

DEFENDANT                                               Case Number 21cr1594-CAB                           

Ernesto Renteria                                             Age: 45                       Chula Vista, CA

SUMMARY OF CHARGES

Conspiracy to Distribute Controlled Substances, in violation of 21 U.S.C. 841 and 846

Maximum Penalty: Life in prison; $10 million fine

AGENCY

Drug Enforcement Administration

Assistant U. S. Attorney Kim-Thoa Hoang (619) 546-9397    

NEWS RELEASE SUMMARY – November 29, 2021

SAN DIEGO – To commemorate American Indian and Alaska Native Heritage Month, the U.S. Attorney’s Office recently hosted an event to celebrate the cultures, traditions and histories of American Indians and Alaska Natives and acknowledge the tremendous contributions of those communities to the United States.

At the November 19 event, Acting U.S. Attorney Randy Grossman expressed his commitment to working as partners with Tribal nations to reduce crime and help victims. “The Department of Justice is committed to improving public safety in Native American communities,” Grossman said. “We stand ready to work with our Tribal partners to develop public safety solutions that work best for Tribal communities in our district.”

Grossman noted in his remarks at the event that the U.S. Attorney’s Office, through its tribal liaison efforts, has built and maintained partnerships with the tribal communities in San Diego County, as well as fostering a strong working relationship with local and county law enforcement agencies for the investigation and prosecution of criminal activities within the reservations. 

Also attending the event were San Diego County Deputy District Attorneys Joe McLaughlin and Brooke Tafreshi and District Attorney Investigator Juan Cisneros, all  tribal liaison representatives; Sheriff’s Captain Mike Rand; Chairwoman Erica Pinto and Councilman James Cuero of the Jamul Indian Village.

Further, in honor of Native American Heritage Month, Chairman Robert Smith of Pala Band of Mission Indians, who also serves as Chairman of the Board of the Southern California Chairmen’s Association, offered some remarks remotely and stressed the importance of working with all levels of law enforcement to ensure the well-being of tribal residents.

“The most basic responsibility of tribal leaders,” Smith said, “is to provide a variety of social, governmental, administrative, educational, health and welfare services for tribal members.  Over the years, Native Americans have made progress in these areas, but there is much more to be done; we need to continue to dedicate ourselves to improving the quality of life of all of our members.  To this end, we also need to promote strong collaborative relationships with governmental agencies to overcome challenges and attain positive solutions.”

This year’s celebration featured a first for the U.S. Attorney’s Office:  The participation in person of one of the tribal leaders in the district, Chairwoman Pinto of the Jamul Indian Village, who delivered keynote remarks.

Chairwoman Pinto shared her background and experience as a tribal leader and award-winning trailblazer who has accomplished much for the benefit of her Tribe and tribal constituents. She stressed the importance of a partnership approach on the part of tribal leaders and organizations as one of the key attributes of successful leadership in building self-reliance and strengthening tribal sovereignty while contributing to the prosperity of the greater community and celebrating the historical legacy and rich culture of Native Americans.

She said: “Tribal independence and self-determination now guide our Tribe. The ability to exercise our inherent right to sovereignty has allowed my tribal community to engage in the self-sufficiency required to tackle issues like education, housing, health care, and economic development.”

Assistant U. S. Attorneys Michael A. Deshong and Adam Gordon (619) 546-9290

NEWS RELEASE SUMMARY—November 24, 2021

SAN DIEGO—El Cajon resident Olatunde James Temitope Akintonde was sentenced in federal court today to 15 years in prison for selling fentanyl-laced pills that caused the death of a 19-year-old Santee man, identified in court records as S.J.G., in March of 2019.

Akintonde previously admitted that he sent messages to S.J.G. through social media on February 28, 2019, to coordinate a sale of what the victim believed to be oxycodone pills. Later that evening, Akintonde delivered two counterfeit oxycodone pills laced with fentanyl to S.J.G. After the meeting, Akintonde sent additional messages to S.J.G. through social media warning that he should only take one of the pills because they were “strong.” Akintonde further admitted that the pills he gave to S.J.G. caused his death. According to other filings in the case, S.J.G. died in his home sometime in the evening of February 28, 2019 or the early morning hours of March 1, 2019.

Special Agents from the Drug Enforcement Administration and a Task Force Officer from the San Diego Sheriff’s Department led the investigation into S.J.G.’s death and quickly identified Aktinonde as the source of the fatal pills. According to the sentencing memorandum, Akintonde offered various prescription pills for sale through different social media platforms. Akintonde also posted photographs of himself brandishing firearms and posted songs promoting the use and distribution of pharmaceutical pills.

“There is an epidemic of counterfeit fentanyl-laced pills in our community,” said Acting U.S. Attorney Randy Grossman. “To be clear: If you are a drug dealer selling pills, and those pills result in death, you will be held accountable for that death. It is no defense to say you didn’t know the pills contained fentanyl.” Grossman praised the prosecution team as well as the Drug Enforcement Administration’s Narcotics Task Force Team 10 and officials from the San Diego Sheriff’s Department and the San Diego County District Attorney’s Office for their excellent work on this case.

“As the number of drug overdose deaths continues to rise in San Diego County, the DEA San Diego Field Division has made investigating overdose deaths a priority,” said DEA Acting Special Agent in Charge Shelly S. Howe. “We are committed to bringing drug dealers like Olatunde James Temitope Akintonde, who poison our communities, to justice.”

This case is the result of ongoing efforts by the U.S. Attorney’s Office, the San Diego County District Attorney’s Office and the Drug Enforcement Administration to investigate and prosecute the distribution of dangerous illegal drugs—fentanyl in particular—that result in overdose deaths. The Drug Enforcement Administration created Narcotics Task Force Team 10 as a response to the increase in overdose deaths in San Diego County. Agents from Team 10 contributed to the investigation into S.J.G.’s death.

DEFENDANTS                                             Case Number 21cr1178-JLS                                        

Olatunde James Temitope Akintonde            Age: 23                       El Cajon, CA

SUMMARY OF CHARGES

Distribution of Fentanyl – Title 18, United States Code, Section 841(a)(1)

Maximum penalty: Twenty years in prison

AGENCY

Drug Enforcement Administration

San Diego Sheriff’s Department

San Diego County District Attorney’s Office

Assistant U. S. Attorneys Owen Roth and Lawrence A. Casper (619) 546-7710

NEWS RELEASE SUMMARY—November 22, 2021

SAN DIEGO—San Diego resident Brandon Jacob Shepherd was sentenced in federal court today to thirteen years and eleven months in prison for selling fentanyl that resulted in the death of an 18-year-old San Diego woman, identified in court records as P.E.R., in January of 2020. He received one month of custodial credit for time served in a local facility before being transferred to federal custody, for a total period of 168 months in custody.

Shepherd previously admitted that on the evening of January 14, 2020, he agreed to coordinate a sale of fentanyl to the victim with co-defendant Leon Chester Kolin III. That evening, Shepherd sold P.E.R. and Kolin a gram of fentanyl for $100 or $120, in the hotel room that Shepherd was staying in and using to distribute fentanyl. After the sale, Shepherd smoked fentanyl with P.E.R. and Kolin; P.E.R. overdosed at that time, but did not die. Kolin took P.E.R. home, with additional fentanyl resin that Shepherd provided. After P.E.R. left, Shepherd told a friend that she nearly “fell out,” meaning she had almost died. Days later, P.E.R. smoked some of the fentanyl resin provided by Shepherd, overdosing and dying. She was only eighteen years old at the time of her death.

Special Agents and Task Force Officers with the Drug Enforcement Administration led the investigation into P.E.R.’s death and identified Shepherd as the source of the fentanyl. Investigators subsequently searched Shepherd’s hotel room. There, they found packages containing fentanyl powder, counterfeit blue “M30” pharmaceutical tablets laced with fentanyl, digital scales bearing fentanyl residue, cash, and unused plastic baggies. They also found and arrested co-defendants Anthony Gascon and Christopher Barksdale, with whom Shepherd was engaged in an ongoing fentanyl distribution scheme. These two defendants, as well as Kolin, were sentenced prior to today.

 “Tragically, fentanyl has again cut down the life of a bright and promising future here in our community, whose loss will forever be felt by her family,” said Acting U.S. Attorney Randy Grossman. “This Office will continue to aggressively pursue and prosecute anyone who seeks to profit, or even to further their own addiction, by peddling this poison. If someone dies from fentanyl you provide them, we will use every tool at our disposal to hold you responsible.” Grossman praised prosecutors Owen Roth and Lawrence Casper as well as the Drug Enforcement Administration’s Narcotics Task Force Team 10 and officials from partnering state and federal agencies for their excellent work on this case.

“The United States just recorded the highest number of drug-overdose deaths in a 12-month period, with over 100,000 Americans losing their lives,” said DEA Acting Special Agent in Charge Shelly S. Howe. “Individuals like Brandon Shepherd are fueling the fire of the drug epidemic. His sentencing today sends a stark reminder that if you choose to sell drugs and risk the lives of others, you will be held accountable.”

“Removing these dangerous and often deadly drugs from the streets is a priority for HSI, as it’s critical to preventing additional overdose deaths in our communities,” said Chad Plantz, Special Agent in Charge for HSI San Diego. “I am extremely proud of our HSI Special Agents and law enforcement partners for the success of this investigation and for making our neighborhoods safer.”

This case is the result of ongoing efforts by the U.S. Attorney’s Office, the Drug Enforcement Administration, Homeland Security Investigations, the Federal Bureau of Investigation, the San Diego Police Department, and the California Department of Health Care Services to investigate and prosecute the distribution of dangerous illegal drugs—fentanyl in particular—that result in overdose deaths. The Drug Enforcement Administration created Narcotics Task Force Team 10 as a response to the increase in overdose deaths in San Diego County. Agents from Team 10 contributed to the investigation into P.E.R.’s death.

DEFENDANT                                               Case Number 20-CR-810-BAS                                            

Brandon Jacob Shepherd                    Age: 26                       San Diego, CA

SUMMARY OF CHARGES

Conspiracy to Distribute Fentanyl – Title 21, United States Code, Sections 841(a) and (b)(1)(C)

Maximum penalty: Twenty years in prison

Distribution of Fentanyl – Title 21, United States Code, Section 841(a)(1)

Maximum penalty: Twenty years in prison

Conspiracy to Distribute 40 grams or More of Fentanyl – Title 21, United States Code, Sections 841(a) & (b)(1)(B)

Minimum penalty of 5 years and maximum penalty of 40 years in prison

AGENCY

Drug Enforcement Administration

Homeland Security Investigations

Federal Bureau of Investigation

San Diego Police Department

California Department of Health Care Services

Assistant U. S. Attorney Oleksandra Johnson (619) 546-9769    

NEWS RELEASE SUMMARY – November 23, 2021

SAN DIEGO –A former office manager for a healthcare provider pleaded guilty in federal court today to one count of wire fraud.  As part of her plea agreement, Ana Phimmasone, 37, of Chula Vista, admitted that from April 2016 until April 2018, she stole $352,594.47 from a local company that provides in-home care services for mostly elderly individuals, as well as from several of its clients.

According to court documents, Phimmasone held a trusted position that allowed her access to client accounts.  Between April 2016 and August 2016, Phimmasone embezzled $25,958.60 by stealing checks that were issued by, or belonged to, her employer, and deposited them into her own bank account.  Then, between December 2016 and April 2018, Phimmasone exploited her access to clients’ credit card information by billing them using PayPal, Venmo, Square and Apple Pay and diverting the money to her own accounts instead of using the funds to pay her employer for the in-home care services.  To make the fraudulent charges appear legitimate, Phimmasone falsely told the victims that the healthcare provider changed its existing payment processing company to PayPal.  After receiving the funds, Phimmasone spent the money or diverted the payments into her personal bank accounts.

To further disguise the illegal transfers and avoid detection, Phimmasone created a fraudulent PayPal account using the name and personal information of C.P., an 87-year-old individual. Phimmasone then used the fraudulent PayPal account to bill the other victims’ credit cards, causing victims to believe they were being charged for legitimate medical care.  To conceal the fact that some clients’ payments were diverted to her own accounts, Phimmasone also created false invoices for victims J.B. and E.B., that fraudulently inflated the amount due which was payable based on medical care services provided to the victims. 

“This defendant exploited the trust that patients place in their care providers,” said Acting U.S. Attorney Randy Grossman. “This successful prosecution demonstrates that our office continues to prosecute anyone who targets vulnerable members of the community.”  Grossman commended the prosecution team and the United States Postal Inspection Service for their efforts to bring this offender to justice.      

Inspector in Charge of the Los Angeles Division Carroll N. Harris stated, “The United States Postal Inspection Service remains unwavering in its strong stance to protect the elderly and other vulnerable populations against criminal acts.  Postal Inspectors will aggressively investigate and prosecute these cases to the fullest extent of the law.”   

As part of her guilty plea, Phimmasone agreed to pay $352,586.22 in restitution to her former employer and a number of individual victims.  Phimmasone is set to appear for sentencing on March 7, 2022.

DEFENDANTS                                             Case Number 21cr3262-H                                

Ana Phimmasone                                            Age: 37                                   Chula Vista, CA

SUMMARY OF CHARGES

Wire Fraud, 18 U.S.C. § 1343

Maximum penalty:

Twenty years’ imprisonment and a maximum fine of $250,000 or twice the gross gain or gross loss resulting from the offense, whichever is greater

AGENCY

United States Postal Inspection Service

NEWS RELEASE SUMMARY – November 19, 2021

SAN DIEGO – Tony Davis was sentenced today in federal court by U.S. District Judge Cathy Ann Bencivengo to 156 months’ custody for supplying the heroin and fentanyl that led to the fatal overdose of a 41-year-old San Diego woman, on October 24, 2018.

According to his plea agreement, Davis agreed to sell more than 100 grams of what he knew to be heroin in the fall of 2018, and on October 24, 2018 he distributed heroin and fentanyl to another street-level drug dealer who in turn distributed the drugs that caused the victim’s death.

DEA Narcotic Task Force Team 10 led the investigation in this case. Team 10 is a specialty unit, with investigators from HSI, FBI, San Diego Police Department, CA Department of Health Care Services and the San Diego District Attorney’s Office, that investigates overdose deaths in San Diego.  Team 10 responds to the discovery of overdose victims and aggressively pursues criminal cases, up the distribution chain, against the dealers and their sources of supply.

“As fentanyl continues to cut its devastating path in our community, we are committed to taking action to stop those who peddle this poison,” said Acting U.S. Attorney Randy Grossman. “We will use every available tool to hold traffickers accountable, confiscate their drugs and put an end to these tragic losses.”

“Overdose deaths continue to rise in San Diego County,” said DEA Acting Special Agent in Charge Shelly S. Howe.  “The DEA and our law enforcement partners are attacking this problem by aggressively targeting the supply chain. It’s simple: If you provide or sell drugs that cause someone to die, we will come after you and your supplier.”

The United States Attorney’s Office is working closely with the San Diego County District Attorney’s Office, local police departments, the Drug Enforcement Administration and other federal, state and local law enforcement partners to investigate and prosecute cases targeting those who supply drugs in fatal overdose cases.

Acting U.S. Attorney Randy Grossman praised prosecutors Stephen H. Wong and Mikaela L. Weber as well as DEA Team 10 investigators for their hard work on the case.

For those who suffer from addiction, please know there is help. Call the Crisis line at 888-724-7240; it’s always open.

DEFENDANT                                               Case Number 19-CR-0294-CAB

Tony Davis                                                    Age: 65         

SUMMARY OF CHARGES

Distribution of Heroin and Fentanyl – Title 21, U.S.C., Section 841(a)(1)

Conspiracy to Distribute Heroin – Title 21, U.S.C., Section 841(a)(1) & 846

Penalties: Mandatory minimum five years in prison; maximum 40 years in prison

AGENCY

Drug Enforcement Administration

 

NEWS RELEASE SUMMARY – November 19, 2021

SAN DIEGO – Acting U.S. Attorney Randy Grossman announced federal drug charges today against Carlos Martin Quintana-Arias of Mexico, following the seizure yesterday of 17,584 pounds of methamphetamine and 388.93 pounds of fentanyl from a commercial trailer attempting entry at the Otay Mesa, California, Commercial Port of Entry. U.S. Customs and Border Protection (CBP) confirmed that both drug seizures would be the largest in each drug category, for both this year and last year, in the entire United States. 

The Complaint alleges that on November 18, 2021, at approximately 8:18 p.m., Quintana-Arias, a Mexican citizen, applied for entry into the U.S. as the driver and sole occupant of a 2009 Kenworth Tractor pulling a 1996 Stoug trailer.  Quintana-Arias’ manifest reflected the trailer contained automotive body parts.  However, according to the Complaint, an X-Ray machine detected anomalies inside the trailer and a drug detection dog alerted to the rear door of the trailer. 

Further inspection of the trailer’s contents revealed a few automotive body parts among 6,266 packages of drugs.  Of the total drug packages, 6,106 packages contained a substance that field-tested positive for methamphetamine; these packages together weighed approximately 7,976.2 kilograms (17,584.33 pounds).  The other 160 packages contained a substance that field-tested positive for fentanyl and weighed approximately176.42 kilograms (388.93 pounds).

“This is a staggering seizure that demonstrates the extent of our current fight against mass production of methamphetamine and fentanyl. But for the vigilance of our law enforcement partners, this record-breaking deluge of drugs would have caused incredible damage in our communities.” said Acting U.S. Attorney Randy Grossman. “We commend our partner agencies for their tireless work and dedication to preventing these dangerous and deadly drugs from entering our country.”

“This record-breaking commercial seizure exemplifies the joint efforts of CBP and HSI employees, who work tirelessly each day to protect our Ports of Entry from the threats posed by drug cartels and other transnational criminal organizations,” said HSI San Diego Special Agent in Charge Chad Plantz. “Countless lives will be saved because of this historic seizure of methamphetamine and fentanyl, but make no mistake: drug cartels strive to exploit our borders to further their criminal enterprises every day. The HSI Border Enforcement Security Task Force and the San Diego Imperial Valley High Intensity Drug Trafficking Area task force, in collaboration with CBP, remain vigilant in the mission to disrupt and dismantle every level of the cartels.”

“Customs and Border Protection is extremely fortunate to have CBP officers with phenomenal skills that enabled them to identify anomalies, leading to use of our technology to confirm and intercept the largest Methamphetamine and Fentanyl seizure nationally within the last two years” said Pete Flores, Director of Field Operations for the San Field Office.  “Our vigilance is critical to our mission and we will continue to make our homeland and communities safer by making sure these dangerous drugs are intercepted.”

Quintana-Arias was arraigned today on the complaint alleging two violations of Title 21, United States Code, Sections 952, and 960. A detention hearing is scheduled for November 23, 2021 at 2:15 p.m.

DEFENDANT                                                Case Number 21-mj-4574-AHG    

Carlos Martin Quintana-Arias                                    Residence: Mexico

SUMMARY OF CHARGES

Title 21, U.S.C., Sections 952 and 960

Importation of a Controlled Substance

Maximum penalty: Life in prison and a mandatory minimum of 10 years in prison; and $10,000,000 fine

AGENCIES

Homeland Security Investigations

U.S. Customs and Border Protection

*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty. 

 

NEWS RELEASE SUMMARY – November 18, 2021

SAN DIEGO – Federal judges, prosecutors, defense attorneys, court personnel and veterans’ advocates gathered in U.S. District Court today to celebrate the five-year anniversary of a program that offers a second chance to veterans who are facing criminal charges.

The Veterans Diversion Program, which began in 2016, allows qualified veterans to plead guilty, and that plea is set aside until completion of the year-long program. During the year participants are continually evaluated by U.S. Pretrial Services and monitored by the court. That can involve drug, alcohol and mental health testing and treatment, plus employment and education counseling. Participants are required to actively seek or maintain employment or schooling and appear before a magistrate judge at least once a month to discuss progress and monitor compliance.

Since 2016, almost 60 veterans have participated in the Veterans Diversion Program.  Thirty-three veterans have graduated so far, and 21 are currently participating. Not everyone graduates; the program is vigorous and requires hard work and accountability. The program continued despite the pandemic.

“I feel strongly that many who have sacrificed so much for their country should be afforded a second chance when possible,” said Acting U.S. Attorney Randy Grossman. “Because of their sacrifices, the country owes them a debt.  And being part of the Veterans Diversion Program is our office’s small part in repaying that debt.”

Getting accepted into the program is not easy. The U.S. Attorney’s Office receives dozens of applications every year.  Those applications are then presented to a committee of 10 federal prosecutors who are also veterans themselves, representing every service. One the committee votes to admit the veteran, that veteran’s application is forwarded to pretrial for an assessment. This is a complete team effort: The Veteran’s Administration, Pretrial Services, Courage to Call, Wounded Warrior, the mentors, the Court and defense attorneys.

Nine Veterans - from the Army, Navy, Marine Corps, Coast Guard, and the National Guard - graduated in 2021. They were all facing felony convictions for a range of crimes. Some faced mandatory minimum sentences of 10 years in prison.  Like the graduates before them, these nine veterans worked hard, embraced treatment, and then saw their charges dismissed.

The Veterans Diversion Program has its roots in the U.S. Attorney’s Office’s original “Diversion Program,” a groundbreaking effort which was started in 2010 in San Diego County through a collaboration between a criminal defendant, a federal prosecutor, a criminal defense attorney, U.S. Pretrial Services and the U.S. District Court. Under that program, certain non-violent offenders who pleaded guilty to human smuggling charges were afforded the opportunity to go through the program and eventually erase their felony conviction. At the time the program was a first-of-its-kind.

Grossman thanked Magistrate Judges William Gallo and Andrew Schopler for dedicating many hours of their valuable time, in addition to their regular duties as Magistrate Judges, to hold monthly court hearings, roundtables, change of plea hearings, bond revocation hearings, and participate in e-mails and phone calls at all hours to help these veterans succeed.

Grossman said: “This program would not be successful without strong leadership and the unwavering commitment from multiple people and organizations who deserve special thanks. This includes Magistrate Judges Gallo and Schopler; Chief U.S. District Judge Dana Sabraw; as well as several dedicated people from the Veteran’s Administration, particularly Joy Villavicencio; Lori Garofalo and her team of outstanding Pretrial Services Officers including Zena Ajou and Justin Garcia; RanDee McLain and her teams from Courage to Call and Wounded Warrior Project; Assistant U.S. Attorneys Blair Perez and Jennifer McCollough; as well as the many defense attorneys including Jami Ferrera, Hector Tamayo, Gary Burcham, and Leila Morgan. Thank you all for making this program a success.”

Grossman thanked the Veterans Diversion Program supporters who attended today’s celebration: Dr. Robert Smith, VHA Regional Director; Dr. Vito Imbasioni, CalVet Secretary; Virginia Wimmer, CalVet Deputy Secretary- Women Veteran Affairs; Mental Health Systems Inc. CEO Jim Callaghan and Vice President Delrena Swaggerty.

Assistant U. S. Attorneys Michael A. Deshong, Daniel C. Silva, and Carl Brooker (619) 546-9290

NEWS RELEASE SUMMARY—November 16, 2021

SAN DIEGO — GPOMCT Grupo Empresarial S.A. de C.V., an international, Mexico-based wholesale currency dealer and currency exchange business, was sentenced in federal court yesterday to three years’ probation and ordered to forfeit $1.1 million for operating an unlicensed money transmitting business.

According to the government’s sentencing memorandum, GPOMCT used the U.S. financial system to process large amounts of currency that were at high risk for including criminal proceeds without registering as a financial institution in the United States or complying with U.S. anti-money laundering regulations or reporting requirements in order to gain a competitive advantage over its competitors.

Mexico’s anti-money laundering restrictions limit the amount of U.S. dollar deposits in Mexico, creating a need for individuals and businesses in Mexico with large amounts of U.S. currency—whether acquired legitimately or otherwise—to convert their U.S. dollars into Mexican pesos. This is a need that GPOMCT attempted to meet, the sentencing memo said.

Special Agents from Homeland Security Investigations (HSI) led the investigation into hundreds of transactions that involved GPOMCT importing large volumes of U.S. dollars into the United States between 2019 and 2021. Agents from Federal Deposit Insurance Corporation Office of Inspector General, U.S. Customs and Border Protection, and San Diego County Sheriff's Department assisted HSI in the investigation.

According to the sentencing memorandum, GPOMCT gained an unfair competitive advantage by accepting large amounts of U.S. dollars from its customers in Mexico in exchange for pesos, then importing its U.S. dollars into the United States. Through its subsidiaries, GPOMCT controls more than 40 locations in Mexico that handle an average of over $1 million in U.S. currency daily. Between September 2019 and September 2020, GPOMCT imported approximately 195 shipments of currency—each worth between $90,000 and $100,000 in U.S. dollars. GPOMCT further employed the services of an armored car company to collect currency for delivery to a third-party intermediary in Miami, Florida—all part of its money transmitting services to Mexican and U.S. customers seeking to convert U.S. dollars to pesos.

These services as a wholesale currency dealer meant GPOMCT operated as an unlicensed money transmitting business in the United States. By failing to register as a money transmitting business, GPOMCT did not file currency transaction reports with the Department of the Treasury, as required by the Bank Secrecy Act, nor did it subject itself to inspection by the Department of Treasury for compliance with these financial laws and regulations.

Acting U.S. Attorney Randy S. Grossman said, “Violating financial laws and regulations not only impairs the fight against international money laundering, tax evasion, and other crimes—these violations can be crimes themselves. This office expects the highest level of compliance from financial institutions in the Southern District of California.” Grossman praised the prosecution team at the U.S. Attorney’s Office and the agents from Homeland Security Investigations, Federal Deposit Insurance Corporation, U.S. Customs and Border Protection and San Diego County Sheriff’s Department for their excellent work on this case.

“When money services businesses fail to comply with federal statutes and regulations, they create an unacceptable risk for illicit funds to be laundered through our financial infrastructure,” said Chad Plantz, Acting Special Agent in Charge for Homeland Security Investigations in San Diego. “HSI is committed to investigating these violations to uphold the integrity of the U.S. financial system and protect our communities, as well as sending a resounding message to all currency exchange businesses, money services businesses, and financial institutions to comply and embrace robust anti-money laundering practices and regulations.”

“Financial crimes, such as those in this case, threaten the integrity of the U.S. financial system and allow money laundering, tax evasion, and other illicit transactions to spread across international borders, undermining the public’s faith in financial institutions. We appreciate the cooperation of our law enforcement partners in investigating this and other financial crimes,” said Special Agent in Charge Jeffrey D. Pittano of the Federal Deposit Insurance Corporation Office of Inspector General (FDIC OIG).

DEFENDANT                                               Case Number 21cr2120-JLS                            

GPOMCT Grupo Empresarial S.A. de C.V.

SUMMARY OF CHARGES

Operating an Unlicensed Money Transmitting Business—Title 18, U.S.C., Section 1960

Criminal Forfeiture—Title 18, U.S.C., Section 982

Maximum penalty: $500,000 fine or twice the gross gain or loss from the offense, whichever is greater; criminal forfeiture

AGENCY

Homeland Security Investigations

Federal Deposit Insurance Corporation Office of Inspector General (OIG)

U.S. Customs and Border Protection

San Diego County Sheriff’s Department

Assistant U. S. Attorneys Daniel C. Silva, Mark W. Pletcher, Lisa Sanniti and Carl Brooker

SAN DIEGO — Pursuant to court order, the U.S. Attorney’s Office for the Southern District of California, in conjunction with the U.S. Postal Investigative Service, will begin liquidation of approximately $57 million in cryptocurrency (at current estimated prices) seized from the top North American promoter of BitConnect. This liquidation is believed to be the largest single recovery of cryptocurrency for victims to date.

On September 1, 2021, Glenn Arcaro, 44, of Los Angeles, pleaded guilty for his participation in a massive conspiracy involving BitConnect, a cryptocurrency investment scheme, which defrauded investors from the United States and abroad of over $2 billion. The BitConnect scheme is believed to be the largest cryptocurrency fraud ever charged criminally.

As part of his plea agreement, Arcaro admitted that he earned no less than $24 million from the BitConnect fraud conspiracy, all of which, according to court documents, he has agreed repay to defrauded investors. The order entered on November 12, 2021, begins the process of making those victims whole by liquidating the fraud proceeds in Arcaro’s possession—the vast majority of which were in the form of cryptocurrencies, including Bitcoin, Ethereum, Litecoin, Dash, and several others.

Acting U.S. Attorney Randy S. Grossman praised the work of the prosecutors and law enforcement agencies handling this matter, including the FBI’s Cleveland Field Office, as well as, more locally, IRS-CI, the Financial Investigations and Border Crimes Task Force (the “FIBC”—a multiagency Task Force based in San Diego and Imperial Counties, funded by the Treasury Executive Office of Asset Forfeiture), who are investigating the matter, and the U.S. Postal Investigative Service in the Southern District of California who is liquidating the cryptocurrency.

All investor victims of the BitConnect fraud are encouraged to visit the following webpage - https://www.justice.gov/usao-sdca/us-v-glenn-arcaro-21cr02542-twr for information on their rights as a victim, the ability to submit a victim impact statement, and to identify themselves as a potential victim.

Arcaro’s sentencing is scheduled to occur on January 7, 2022, before U.S. District Judge Todd W. Robinson.

DEFENDANT                                               Case Number 21CR2542-TWR                               

Glenn Arcaro                                                  Los Angeles, CA                    Age: 44

SUMMARY OF CHARGES

Conspiracy to Commit Wire Fraud—Title 18, U.S.C., Section 1349

Criminal Forfeiture—Title 18, U.S.C., Section 982

Maximum penalty: Twenty years in prison, $250,000 fine or twice the gross gain or loss from the offense, whichever is greater, forfeiture, and restitution

AGENCIES

FBI

IRS Criminal Investigation—Financial Investigations and Border Crimes Task Force

United States Postal Inspection Service

*The charges and allegations contained in an indictment or information are merely accusations, and the defendants are considered innocent unless and until proven guilty. 

 

Assistant U. S. Attorneys Blanca Quintero (619) 546-7118 and Vivian Sapthavee (619) 546-7696

NEWS RELEASE SUMMARY – November 16, 2021

SAN DIEGO – An indictment was partially unsealed yesterday in federal court charging 29 alleged members of an international money laundering organization that is tied to the Sinaloa Cartel and Jalisco New Generation Cartel in Mexico.

During the past week, federal, state, and local law enforcement officials have arrested
21 defendants throughout San Diego, Calexico, and Bakersfield, California, who were allegedly involved in a sophisticated international money laundering scheme.

According to the indictment and other public records, this Imperial Valley-based money laundering organization (MLO) laundered in excess of $32 million in drug proceeds from the United States to Mexico.  The money laundering organization secured contracts with drug trafficking organizations in Mexico to pick up drug proceeds in cities throughout the United States, including Baltimore; Detroit; Los Angeles; Philadelphia; Boston; Denver; Chicago; New York City and numerous others.

Once the MLO received a contract, it communicated with couriers and bank account holders using burner phones and code phrases to coordinate bulk cash deposits into fictitious funnel business bank accounts, the indictment said.  The defendants allegedly served as either couriers and/or funnel bank account holders.  The couriers travelled from San Diego to cities throughout the country to receive the bulk cash after using photographs and codes to verify the meeting details.  The bulk cash was typically concealed in trash bags, duffel bags, or shoeboxes.  After the illicit cash proceeds were deposited into the fictitious funnel bank accounts, the monies were wired to personal bank accounts in Mexico where the money was then dispersed to the drug trafficking organizations.  

“Today we have dealt a serious blow to this Imperial Valley-based international money laundering network with ties to the Sinaloa Cartel and the Jalisco New Generation Cartel,” said Acting U.S. Attorney Randy Grossman. “By dismantling this network, the Department of Justice reaffirms its unwavering commitment to bringing to justice those who corrupt our financial systems by laundering their illicit proceeds.” Grossman commended the prosecution team at the U.S. Attorney’s Office and our law enforcement partners with Homeland Security Investigations (HSI), Drug Enforcement Administration (DEA), and Internal Revenue Service (IRS) Criminal Investigation Division, for their excellent work on this case.

“This complex financial investigation is a perfect example of the unrelenting focus shown by HSI and its partners in the Costa Pacifico Money Laundering Task Force to stop criminal organizations attempting to launder illicit narco dollars,” said HSI San Diego Special Agent in Charge Chad Plantz. “The key to dismantling Drug Trafficking Organizations is disrupting the flow of illicit funds and attacking the money laundering element of the organizations. HSI will continue to work with its fellow law enforcement partners to protect U.S. financial infrastructure and use our comprehensive investigative authorities to stop criminal organizations engaged in drug trafficking and money laundering.”

Acting U.S. Attorney Grossman also praised federal, state, and local law enforcement for the coordinated team effort in the culmination of this investigation.  Agents and officers from the United States Marshals Service, Customs and Border Protection, San Diego Sheriff’s Department, and state and local law enforcement from the Imperial Valley area also provided vital assistance for the investigation. Additionally, this investigation was conducted with support from the Treasury Executive Office for Asset Forfeiture (TEOAF) Third-Party Money Laundering (3PML) program and the High Intensity Drug Trafficking Area program.

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. This case was led by the HSI Costa Pacifico Money Laundering Task Force (CPTF), the DEA, and the IRS - Criminal Investigation. The CPTF is a cooperative partnership of federal, state and local law enforcement agencies focusing on domestic and transnational criminal organizations seeking to cleanse and conceal narcotics proceeds via bulk cash smuggling or through national and international financial systems.

An indictment is not evidence of guilt. The defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

DEFENDANTS                                             Case Number 21cr2546-GPC                           

Ricardo VALENZUELA-Gale                          Age: 25           Mexicali, Mexico

David DURAN-Rivera                                   Age: 35           BOP Custody

Gerardo SILVAS                                           Age: 33           Mexicali, Mexico (BOP Custody)

Jose Luis VARGAS-Espinosa                        Age: 30           BOP Custody

Robert ANZALDO                                        Age: 28           Mexicali, Mexico

Diana Brenda RODRIGUEZ-Sandez              Age: 23           Mexicali, Mexico

Christian FERNANDEZ                                 Age: 29           Mexicali, Mexico

Julia Vianney SUAZO-Quirino                      Age: 23           Mexicali, Mexico

Adrian Rosett VELASQUEZ                           Age: 23           Mexicali, Mexico

Shantal MACIEL                                           Age: 34           Mexicali, Mexico

Cesar Enrique CANTU                                  Age: 29           Unknown

Nessie Aizu                                                 Age: 28           Mexicali, Mexico

Alejandro CABRERA-Herrera                        Age: 21           Unknown

Adriana Elizabeth VALENZUELA-Gale           Age: 28           Mexicali, Mexico

Axel GUADALUPE                                         Age: 20           Unknown

Fidel Alejandro ZAMARANO-Bernal              Age: 33           Unknown

Derian SERVIN-Diaz                                     Age: 25           Unknown

Erik D. GALAVIZ                                           Age: 30           Mexicali, Mexico

SUMMARY OF CHARGES

Conspiracy to Launder Monetary Instruments (18 U.S.C. §§ 1956(a)(1) and (h))

Maximum Penalties: Twenty years in prison, $500,000 fine or twice the value of the monetary instrument or funds involved.

AGENCIES

Homeland Security Investigations

Drug Enforcement Administration, Narcotics Task Force

Internal Revenue Service - Criminal Investigation

Customs and Border Protection, Office of Field Operations

San Diego Sheriff’s Department

On Friday, U.S. District Judge Todd W. Robinson granted a request from the U.S. Department of Justice and the U.S. Attorney’s Office for the Southern District of California for authority to liquidate approximately $56 million in fraud proceeds seized from the self-described “number one promoter” of BitConnect, a cryptocurrency, who consented to the seizure. This liquidation is the largest single recovery of a cryptocurrency fraud by the United States to date. 

According to court documents, on Sept. 1, Glenn Arcaro, 44, of Los Angeles, pleaded guilty to participating in a massive conspiracy to defraud BitConnect investors in the United States and abroad, in which investors were fraudulently induced to invest over $2 billion. The BitConnect scheme is the largest cryptocurrency fraud scheme ever charged criminally.

With entry of the court’s interlocutory sale order, the government will begin the process of seeking to make whole victims of the BitConnect scheme by selling the cryptocurrency and holding the proceeds in U.S. dollars. The government will maintain custody of the seized proceeds in cryptocurrency wallets and intends to use these funds to provide restitution to the victims pursuant to a future restitution order by the court at sentencing. 

All potential victims of the BitConnect scheme are encouraged to visit https://www.justice.gov/usao-sdca/us-v-glenn-arcaro-21cr02542-twr for information on rights they may possess as a victim, the opportunity to submit a victim impact statement, and to identify themselves as a potential victim.

Arcaro is scheduled to be sentenced on Jan. 7, 2022, and faces a maximum penalty of 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

The FBI and IRS-Criminal Investigation are investigating the case. The U.S. Postal Inspection Service is assisting with the liquidation of the cryptocurrency proceeds.

Trial Attorney Kevin Lowell of the Criminal Division’s Fraud Section and Assistant U.S. Attorneys Daniel Silva, Mark W. Pletcher, Carl Brooker, and Lisa Sanniti of the Southern District of California are prosecuting the case. The Department of Justice’s Office of International Affairs provided indispensable assistance to the investigation. 

NEWS RELEASE SUMMARY – November 10, 2021

SAN DIEGO – Angel Dominguez Ramirez Jr. of Tamaulipas, Mexico, pleaded guilty in federal court today to drug and money laundering charges, admitting that he was the leader of a trafficking organization that transported ton-quantities of cocaine from South America to Mexico and into the United States.

According to court documents, the organization Dominguez headed called itself El Seguimiento 39, or El Seg 39. El Seg 39 obtained cocaine from sources of supply in South and Central America and used drug transportation cells in Central America to transport the cocaine into Mexico via boats, aircraft and commercial vehicles, where its transportation network moved cocaine across the U.S.-Mexico border at ports of entry in Texas and California and into cities within the United States.  Dominguez purchased cocaine from sources of supply stretching from the Chiapas state of Mexico to Peru, including sources in Guatemala, Honduras, Costa Rica, Colombia, Venezuela, and Ecuador. 

The charges to which Dominguez pleaded guilty stem from a long-standing investigation that led to more than 30 seizures totaling five tons of cocaine and over $9 million of drug-related proceeds. According to the government filing, Dominguez, a former United States Marine and dual U.S.-Mexican citizen, built his organization through cooperative alliances with the Beltran Leyva Organization (BLO), the Cartel de Jalisco Nueva Generacion (CJNG), the Sinaloa Cartel, the Cartel del Golfo (CDG), and the Los Zetas.  His organization not only moved vast quantities of its own cocaine and marijuana into the United States, but it was also used by leaders of other Mexican cartels and drug trafficking organizations to move illegal drugs into the United States. 

“Today’s guilty plea shows that this office, together with its law enforcement partners, will continue to hold accountable those who are importing huge quantities of dangerous drugs into this country,” said Acting United States Attorney Randy Grossman. Grossman thanked prosecutor Kyle Martin, Homeland Security Investigations, the Drug Enforcement Administration, and Customs and Border Protection for their excellent work on this case.

“Today’s guilty plea of Angel Dominguez Ramirez Jr. demonstrates the enormous value of strong international and domestic law enforcement partnerships,” said Chad Plantz, acting Special Agent in Charge of Homeland Security Investigations (HSI) in San Diego. “This successful prosecution is the culmination of years of investigative effort by HSI special agents and our partners, to uncover and dismantle Dominguez’s drug trafficking operations.”

“The DEA and our law enforcement partners will continue to target high-level individuals and organizations who contribute to addiction and death in the United States for their monetary gain,” said DEA San Diego Field Division Acting Special Agent in Charge Shelly S. Howe. “Today’s guilty plea is testament that collaborative efforts with our law enforcement partners are making a positive impact locally and nationwide by disrupting the drug supply chain.”

This effort is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach.

DEFENDANT                                                           Case Number: 16CR1996-WQH

Angel Dominguez Ramirez                                        Tamaulipas, Mexico

SUMMARY OF CHARGES

Conspiracy to Distribute Controlled Substances for Purpose of Unlawful Importation, in violation of Title 21 U.S.C. §§ 959, 960 and 963; Term of custody including a mandatory minimum 10 years and up to life imprisonment, $10 million fine and 5 years supervised release

Conspiracy to Launder Monetary Instruments, in violation of Title 21 U.S.C. §§ 1956(a)(2)(B)(i). Term of custody of up to 10 years, $500,000 fine

AGENCIES

Homeland Security Investigations

Drug Enforcement Administration

Customs and Border Protection

Department of Justice, Organized Crime Drug Enforcement Task Force

Department of Justice, Office of Enforcement Operations

Department of Justice, Office of International Affairs

Assistant U. S. Attorney Amanda T. Muskat (619) 546-6495   

NEWS RELEASE SUMMARY – November 9, 2021

SAN DIEGO – Leobardo Soto-Toledo, a foot guide who led a group of 14 undocumented migrants into the United States through an underground drainage pipe during heavy rains, resulting in a death and a near-drowning, was sentenced in federal court yesterday to 45 months in prison.

As reflected in the court records, on January 29, 2021, the group of migrants entered the United States near Chula Vista, California, by either climbing over the international boundary fence or traversing through a drainage pipe that runs underground approximately one-quarter mile from Mexico into the United States. The storm drain is capped on the United States side by a mechanical grate, located approximately one-and-a-half miles east of the San Ysidro, California Port of Entry.

The defendant acted as a foot guide, leading the undocumented migrants into the United States by crossing the boundary fence close to the grate. Thereafter, the defendant entered the drainage pipe and guided the undocumented migrants behind him through the approximately 5-foot diameter pipe, eventually reaching the mechanical grate at the end, which can only be opened on the United States side. Stormy conditions caused water to rush through the drainpipe at a high speed. A digital intrusion device captured an image of individuals at the mouth of the grate.

According to court records, the defendant’s role was to travel to the grate and attempt to convince U.S. Border Patrol personnel to open the grate by yelling for help amidst the flowing water, allowing the migrants behind him to exit the open grate and further their entry into the United States.

When Border Patrol agents responded to the scene, they opened the grate, and the migrants flowed out on the rushing water. Border Patrol agents located one individual floating in the water who was deceased, and was later identified as the defendant’s brother and fellow foot guide. Border Patrol agents located another individual floating unconscious after traveling through the grate and managed to resuscitate her and transport her to a hospital.

“Human smuggling efforts that result in a death and endanger lives are tragic and deeply disturbing,” explained Acting U.S. Attorney Randy S. Grossman.  “We will continue to use all means at our disposal to hold accountable those placing human beings at substantial risk of injury and death.” Grossman thanked prosecutor Amanda Muskat and the U.S. Border Patrol for their excellent work on this case.

“We are grateful for the resolve and perseverance that our law enforcement community demonstrated during the past several months, including that of the United States Attorney’s office,” said Chief Patrol Agent Aaron Heitke. “Collaboratively, the efforts of our men and women resulted in Leobardo Soto-Toledo’s arrest, conviction, and just sentencing.”

When handing down the sentence, U.S. District Court Judge Cynthia Bashant noted that this event was “a tragedy for all involved.” Judge Bashant held that the migrants were placed at substantial risk of death or great bodily injury and applied a sentencing enhancement due to the fatality caused by the defendant’s conduct.

DEFENDANT                                               Case Number 21cr607-BAS                                       

Leobardo Soto-Toledo                                    Age: 54                       Residence: Mexico

SUMMARY OF CHARGES

8 U.S.C. § 1324(a)(1)(A)(i) and (v)(II) – Bringing in Illegal Aliens and Aiding and Abetting (Counts 1, 12, and 17)

Maximum Penalties:  Ten years in prison; $250,000 fine

INVESTIGATING AGENCY

United States Border Patrol

NEWS RELEASE SUMMARY – November 1, 2021

SAN DIEGO ­– Cuong H. Nguyen was sentenced in federal court today after pleading guilty to a conspiracy to engage in a wide-ranging postage counterfeiting, forging, and tampering scheme that, over the course of multiple years and more than 160,000 packages, deprived the U.S. Postal Service (“USPS”) of approximately $5 million of postage due and owing.  

Special Agents from U.S. Postal Inspection Service, IRS Criminal Investigation, and the Financial Investigations and Border Crimes Task Force (the “FIBC”—a multiagency Task Force based in San Diego and Imperial Counties, funded by the Treasury Executive Office of Asset Forfeiture)—led the investigation. As he admitted at the sentencing hearing before Hon. Cynthia A. Bashant, Cuong digitally altered, counterfeited, forged, and tampered with various “postage evidencing systems”—i.e., postage meters. These postage meters are intended to expedite the delivery and shipment of USPS packages by allowing mailers to purchase and affix postage labels in advance of depositing them into the mail.

In sentencing Mr. Nguyen, Judge Bashant said, “The USPS provides a valuable service. Fraudulent acts like this will prevent us from having the postal service in years to come.” Nguyen primarily used the postage evidencing system known as Click-N-Ship® when sending packages of beverages and food products from his businesses in San Diego. When the USPS received the packages with labels that Nguyen and others had altered, forged, and counterfeited, they paid much less to the USPS than was owed, but the packages—approximately 162,221 between 2015 and 2019—were delivered anyways.

Acting U.S. Attorney Randy S. Grossman said, “I commend the work of the USPIS, IRS-CI, and the FIBC for unraveling this complex web of digital crime. This is a great example of how the U.S. Attorney’s Office will continue to work collectively with our law enforcement partners to pursue the most challenging investigations as we protect our nation’s resources, including the U.S. Postal Service.”

“With the U.S. Postal Service delivering almost 150 billion pieces of mail annually scammers mistakenly believe they can hide and profit from postage fraud,” stated Inspector in Charge Carroll N. Harris III of the U.S. Postal Inspection Service Los Angeles Division. “The U.S. Postal Inspection Service has over 246 years of defending the nation’s mail system. We remain steadfast in exposing scammers. Today’s sentencing reaffirms the commitment Postal Inspectors have in holding criminals accountable and ensuring the public trust in the mail.”

“Mr. Nguyen perpetrated a complex postal fraud scheme and enriched himself with funds stolen from the United States,” said Special Agent in Charge Ryan L. Korner of IRS Criminal Investigation’s Los Angeles Field Office. “IRS Criminal Investigation is proud to lead the FIBC and to work with our law enforcement partners to root out financial frauds and to protect our country’s critical infrastructure.”

As a result of the conspiracy, Nguyen underpaid $5,127,712.88 in postage to the USPS, resulting in net profits to Nguyen, his businesses, and others of $862,374.00. His sentence of 3 years’ probation includes the obligation to forfeit $862,374.00, as profits, proceeds, and property obtained directly or indirectly from the conspiracy.

DEFENDANT                                               Case Numbers 21-CR-1131-BAS                                          

Cuong H. Nguyen                                           San Diego, CA                        Age: 37

SUMMARY OF CHARGES

Criminal Conspiracy – Title 18, U.S.C., Section 371

Maximum penalty: Five years in prison, forfeiture, and $250,000 fine

AGENCIES

United States Postal Inspection Service

IRS Criminal Investigation—Financial Investigations and Border Crimes Task Force

 

Special Assistant U.S. Attorneys Lisa J. Sanniti (619) 546-8811 and Jeffrey D. Hill (619) 546-7924

NEWS RELEASE SUMMARY – October 26, 2021

SAN DIEGO – Melissa Alvarez Torres and Jose Luis Olmos Hernandez were sentenced in federal court today to 33 months and 40 months in prison, respectively, for stealing hundreds of thousands of dollars from pregnant women and using the money to buy multiple properties in Mexico, including a beachfront home in Nayarit. 

The couple from Chula Vista pleaded guilty in July, admitting that during a four-year period, their healthcare fraud scheme to sell bogus insurance to pregnant women caused more than $1 million in losses to California’s Medi-Cal Access Program known as MCAP.

MCAP is a government health care program administered by the California Department of Health Care Services that provides working, middle-income California families access to affordable maternity and post-natal care.  Alvarez and Olmos were very familiar with MCAP, twice utilized the program for their family.

According to court documents, beginning in 2016, Alvarez and Olmos used Facebook to fraudulently market private “insurance” under the name Seguros Americanos Embarazo (“American Pregnancy Insurance”).  They targeted pregnant women living in Mexico and holding work or tourist visas permitting them to enter the United States. These women contacted Alvarez and Olmos through Facebook or WhatsApp after being referred by other women.  Alvarez and Olmos falsely claimed that their “insurance” product would permit these pregnant women to give birth legally in the United States without risk to their visas. 

The women, many first-time mothers dealing with high-risk pregnancies, hoped to access high quality American health care and knew that they could not lawfully use a public health program, and that they would lose their visas if they did so. Alvarez and Olmos falsely assured the pregnant women that their product was private insurance and instructed them on how to avoid any problems when crossing the border for medical appointments. Alvarez and Olmos charged each woman between $1,200 and $3,000 per pregnancy for the “insurance.”

Alvarez and Olmos have admitted that, in reality, they did not have private insurance to sell.  They used the women’s personal identifying information to sign them up for MCAP benefits through the State of California without the knowledge or consent of the women. Alvarez and Olmos submitted hundreds of false applications and fraudulent supporting tax and employment documents to MCAP, falsely claiming that the women were California residents and therefore eligible for benefits.  Alvarez also impersonated dozens of these women in phone calls to MCAP trying to get the fraudulent applications approved.  Alvarez and Olmos thereby cost American taxpayers over $1 million in health care costs and profited by charging hundreds of thousands of dollars in fraudulent fees paid by the pregnant women.

Additionally, Alvarez has agreed to pay almost $22,000 in restitution to the State of California for Medi-Cal benefits she, Olmos, and their children received as a result of her concealing these fraud proceeds and properties she and Olmos owned in Mexico.

As part of their sentence, Alvarez and Olmos were ordered to forfeit $424,500 in criminal proceeds, and to pay more than $1.5 million in restitution to the State of California and 283 individual victims of their fraud.

This case is a result of a multiagency investigation initiated by the California Department of Health Care Services – Investigations Branch, pursuant to the Travel and Residency Enforcement Co-Op with the Social Security Administration and the United States Attorney’s Office for the Southern District of California, along with the Federal Bureau of Investigation.

“These defendants exploited families at their most vulnerable and defrauded our vital public health programs to line their pockets,” said Acting U.S. Attorney Grossman. “Our office is committed to protecting the American taxpayer and ensuring the integrity of safety net programs by prosecuting those who exploit them.” Grossman commended the exemplary work of prosecutors Lisa Sanniti and Jeffrey Hill and the federal and state agents who diligently pursued this case.

“Today’s sentencing of the defendants is evidence of the teamwork with our federal partners in stopping criminals defrauding California’s Medi-Cal program and, in turn, the residents of our state.  I commend the personnel of the DHCS Investigations Branch, the FBI, and the US Attorney’s Office for their commitment and dedication in protecting the integrity of Medi-Cal,” said DHCS Director Michelle Baass.

“The defendants were driven by greed and devised an elaborate scheme to defraud the state and make a quick buck,” said FBI Special Agent in Charge Suzanne Turner. “Today, they found out the cost of their scheme. This case should serve as a warning – the FBI will continue to work with our state partners at the California Department of Health Care Services to detect and disrupt those who abuse government funded health care programs which ultimately puts the viability of those programs at risk.”

DEFENDANTS                                            Case No. 20-CR-3335-GPC

MELISSA ALVAREZ TORRES                   Age 33            Chula Vista, CA

     aka “Melissa Torres”

     aka “Melissa A. Torres”

JOSE LUIS OLMOS HERNANDEZ             Age 36            Chula Vista, CA

     aka “Jose Luis Hernandez”

     aka “Jose L. Hernandez”

     aka “Jose Carlos”

     aka “Carlos Garcia”

SUMMARY OF CHARGES

Conspiracy to Commit Health Care Fraud and Wire Fraud – Title 18, U.S.C., Section 1349

AGENCIES

State of California’s Department of Health Care Services – Investigations Branch

Federal Bureau of Investigation

Assistant U. S. Attorney Andrew J. Galvin (619) 546-9721

NEWS RELEASE SUMMARY – October 25, 2021

SAN DIEGO – Anthony Reyes Vazquez pleaded guilty in federal court today, admitting that he stole more than $300,000 from the Manzanita Band of the Kumeyaay Nation while serving as chief of the Manzanita Tribal Police Department.

According to his plea agreement, Vazquez admitted that he sold fake badges to buyers who made substantial payments to become members of the Manzanita Tribal Police Department and have privileges available to law enforcement officers, such as carrying concealed weapons.

From 2012 to 2018, Vazquez served as the Chief of Police for the Manzanita Tribal Police Department.  The Manzanita Tribal Police Department, however, was not recognized by the Bureau of Indian Affairs or the State of California as a police department, and it did not have the authority to enforce federal or state laws, on or off the reservation.

In his plea agreement, Vazquez admitted that he and other tribal police officers recruited wealthy individuals in the Los Angeles area to become members of the Manzanita Tribal Police Department. These wealthy individuals often had little to no law enforcement experience before joining the police department.  Vazquez and his recruiters asked these wealthy individuals – known as the “VIP Group” – to make large payments, ranging from $5,000 to $100,000, in exchange for membership in the Manzanita Tribal Police Department, which included a badge purporting to allow the holder to carry a concealed weapon.  Members of the VIP Group were not expected to perform any law enforcement services for the police department and many never visited the Manzanita Band reservation.

As a result of this recruiting effort, dozens of individuals paid the recruiters and, in return, these individuals were made members of the Manzanita Tribal Police Department. Vazquez paid cash kickbacks or commissions to the recruiters and paid himself approximately $2,000 per month as purported reimbursement for travel expenses from his home to the reservation. In addition, Vazquez kept approximately $300,000 worth of donations from the VIP Group, which Vazquez admitted should have instead been given to the Manzanita Band.  Vazquez did not disclose to the Manzanita Band that he was selling membership to the Manzanita Tribal Police Department to unqualified members in exchange for large sums of money or that he was paying himself out of money collected by recruiters.

As part of his plea, Vazquez also admitted that he suffered a felony drug conviction in 1992 and illegally possessed approximately twenty-four firearms while serving as Chief of Police of the Manzanita Tribal Police Department.

"This defendant sold law enforcement badges and jeopardized public safety,” said Acting U.S. Attorney Randy Grossman. “His manipulative and self-serving ploy also significantly undermined state laws governing the issuance of credentials to carry concealed weapons.” Grossman thanked prosecutors Andrew Galvin and Frances Lewis, as well as FBI agents, for their excellent work on this case.

“Anthony Vazquez, a convicted felon, collected hundreds of thousands of dollars in ‘donations’ from dozens of people - to line his own pockets - in exchange for giving them police credentials,” said FBI Special Agent in Charge Suzanne Turner. “This brazen scheme not only deprived the Manzanita Band of funding, but also caused numerous untrained ‘officers’ to believe they were authorized to carry concealed weapons on and off the reservation and enforce laws with little to no training.”

Vazquez is scheduled to be sentenced on January 24, 2022 at 8:30 a.m. before U.S. District Judge Gonzalo P. Curiel.

This case is being prosecuted by Assistant U.S. Attorneys Andrew Galvin of the Southern District of California and Frances Lewis of the Central District of California.

DEFENDANT                                               Case Number 21-CR-3020-GPC                                         

Anthony Reyes Vazquez                                Age: 49                                   Camarillo, CA

SUMMARY OF CHARGES

Theft Concerning Programs Receiving Federal Funds – Title 18, U.S.C., Section 666(a)(1)

Maximum penalty: Ten years’ imprisonment and $250,000 fine

AGENCY

Federal Bureau of Investigation

Assistant U.S. Attorney Andrew Sherwood (619) 546-9690 or Assistant U.S. Attorney Mandy Griffith (619) 546-8970

NEWS RELEASE SUMMARY – October 20, 2021

SAN DIEGO – Kevin Brito of Imperial Beach was sentenced in federal court today to 15 years in prison for deceiving girls as young as 10 into making and sending him sexually explicit photos and videos of themselves.

Brito pleaded guilty on April 19, 2021 to two counts of Enticement of a Minor, admitting that he systematically targeted young girls on social media by reaching out to them and pretending to be a 12- to 14-year-old boy or girl. This included messaging with over 200 minor females online.

Brito tricked many of the young girls into thinking he was their boyfriend and then coerced them into sending him sexually graphic photos and videos. Brito told his victims to make and send more sexually explicit material and directed exactly what he wanted them to do in the material. When his victims tried to refuse, he told them that if they didn’t do what he said, he would send all the explicit material to their friends and families. At times, he followed through on those threats. He told his victims that each was his “sex slave.”

When interviewed by FBI agents, Brito admitted to communicating with one of the minor victims, receiving nude images of her, and threatening her so he could get more images. He also admitted that he knew she was 10 years old and engaged in similar sexually explicit chats with other young girls. Further, Brito said that he saved some of the files he received from the girls and sent them out to other random people.

“These young girls have been traumatized by the despicable actions of this predator,” said Acting U.S. Attorney Randy Grossman. “We will do everything legally possible to achieve justice for children who are sexually exploited.” Grossman thanked prosecutors Andrew Sherwood and Mandy Griffith and the FBI agents for their excellent work on this case.

“Unfortunately, cases such as this involving an adult coercing young girls to create and send sexually explicit images are on the rise. The defendant victimized hundreds of minors from behind his computer screen believing he was invisible to law enforcement,” said FBI Special Agent in Charge Suzanne Turner. “The FBI will continue its exhaustive work of rooting out those who prey on the most vulnerable of victims online. This case is another example of the great collaborative work among law enforcement agencies to hold criminals accountable. I would like to specifically thank local law enforcement for identifying the subject and referring him to the FBI to enable us to put an end to the criminal conduct of this serial child predator.” 

Project Safe Childhood (PSC) is a nationwide federal initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by the U.S. Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. In the Southern District of California, the PSC Coordinator is assigned to the Violent Crimes & Human Trafficking Section.        

DEFENDANT                                               Criminal Case No. 21-CR-01479-DMS

Kevin Brito                                                     Age: 22, Imperial Beach, CA

SUMMARY OF CHARGE

Enticement of a Minor – Title 18, U.S.C., Section 2422(b)

Maximum penalty: Life in Prison; $250,000 fine

INVESTIGATING AGENCY

Federal Bureau of Investigation

Assistant U. S. Attorneys Connie Wu (619) 546-8592 and Cindy Cipriani (619) 546-9608

NEWS RELEASE SUMMARY – October 19, 2021

SAN DIEGO – To address an increase in violent crime, the U.S. Attorney’s Office and its law enforcement partners in the Southern District of California have launched an effort to strategically prosecute the region’s most violent and prolific offenders who are believed to be most responsible for the spike, including those with criminal history and criminal gang affiliation who commit gun crimes.

According to data released in July by the San Diego Police Department (SDPD), gang-related shootings increased 129 percent in the first half of 2021, compared to 2020, and more than 1,000 guns were recovered pursuant to criminal investigations. Responding to this spike, federal gun-related prosecutions in the Southern District of California increased in FY 2021 by almost 50 percent – to the highest levels seen in this office. Most of the defendants were charged with Dealing in Firearms without a license; Possession of Firearms by Prohibited Persons; or Possession of a Firearm in Furtherance of a Drug Trafficking Crime or Crime of Violence.

“Our overriding goal is to reduce violent crime strategically, rather than merely increasing the number of arrests and prosecutions,” said Acting U.S. Attorney Randy Grossman. “Together with our federal, state and local law enforcement partners, we continually direct our focus to the most dangerous people, those responsible for endangering neighborhoods and driving up the violent crime rate.”

“The Bureau of Alcohol, Tobacco, Firearms and Explosives is the lead federal law enforcement agency involved in investigations of firearm trafficking,” said ATF Los Angeles Field Division Special Agent in Charge Monique Villegas. “ATF’s highest priority is reducing gun-related violence. When firearms make their way into the criminal element, violence occurs. ATF’s goal is to reduce violent crime by restricting the flow of firearms to prohibited persons, violent criminals and across the border to Mexico. By focusing on firearms trafficking through intelligence-driven investigations, ATF aims to keeps guns out of the hands of those criminals pulling the trigger.”

“The FBI is committed to working with our law enforcement partners to root out violent, criminal groups who terrorize our communities,” said FBI Special Agent in Charge Suzanne Turner. “The FBI's multiple interagency task forces have proven to be well-versed in identifying, investigating, and mitigating those violent threats and taking guns off the streets to make our communities safer.”

“I’m proud to partner with the U.S. Attorney’s Office and our law enforcement partners to strategically address the spike in gang violence in San Diego,” said San Diego County District Attorney Summer Stephan. “The DA’s Office has seen gang homicide cases nearly triple in the last year. We want to be part of the solution by working with law enforcement partners to curb violent gang crimes, while also investing in prevention efforts with our community members to redirect our youth into positive and healthy lifestyles.”

“Now more than ever, it is essential that we work together to prevent and respond to violent crime. This partnership sends a message to would-be criminals that keeping San Diego safe is a priority,” said Chief David Nisleit. “I'd like to thank our longstanding community and law enforcement partners for joining us in this effort to fight violent crime.”

Consistent with the comprehensive strategy announced by the Attorney General and Deputy Attorney General in May 2021, the Southern District of California has taken several steps to get guns out of the hands of the most violent offenders and prevent violence in our communities.  These efforts include firearm prosecutions initiated against dangerous felons known to be members of gangs. These gun prosecutions involve various types of firearms, and many of the defendants committed the firearm offenses while on probation or parole for prior crimes, including drug trafficking, carjacking, robbery, burglary, false imprisonment, and domestic violence. Two cases recently resulted in lengthy sentences:

• In August 2021, Jason John Clipper, aka “Smokey,” a member of the East Side San Diego criminal street gang with ties to the Mexican Mafia prison gang, was sentenced in federal court to 15 years in prison for unlawfully possessing a firearm, possessing methamphetamine and heroin with the intent to distribute, and possessing a firearm in furtherance of a drug trafficking offense. At the time of his arrest, San Diego County Probation officers found Clipper in possession of approximately 20 grams of methamphetamine, 8 grams of heroin, and a loaded firearm. Clipper was on Post Release Community Supervision for a previous narcotics and firearm conviction in the California Superior Court. (https://www.justice.gov/usao-sdca/pr/san-diego-gang-member-sentenced-15-years-prison-dealing-methamphetamine-and-heroin).
   
• In September 2021, Joseph Anthony Martino, a convicted felon with a long criminal history that prevents him from legally owning guns, was sentenced in federal court to 10 years in prison for kidnapping and possessing firearms. Martino admitted that on April 1, 2019, he held three people hostage at his Lakeside home, pointing loaded guns – including a fully automatic assault rifle - at their heads and threatening them (https://www.justice.gov/usao-sdca/pr/convicted-felon-sentenced-10-years-prison-kidnapping-and-possessing-firearms). 

These cases are part of the DOJ’s initiative to reduce gun violence known as Project Safe Neighborhoods. PSN is an evidence-based program proven to be effective at reducing violent crime.  Through PSN, a broad spectrum of stakeholders works together to identify the most pressing violent crime problems in the community and develops comprehensive prosecution and community outreach solutions to address them.

To ensure our firearm prosecutions maintained strategic focus on the most significant threats to public safety, Acting U.S. Attorney Grossman and the district’s PSN Coordinator, Assistant U.S. Attorney  Connie Wu, joined forces with the District Attorney’s Office Gangs Division leadership to convene state, local, and federal law enforcement agencies for the Combatting Gang Violence to Restore Public Safety Summit this past summer. This summit, which will now occur quarterly, is a collaborative effort to identify and address the most significant drivers of violent crime in our district. 

In addition to individual firearm prosecutions, the U.S. Attorney’s Office has conducted a number of large-scale takedowns with federal and local law enforcement partners that have made a direct impact on public safety in San Diego.

• In April 2021, a federal grand jury indicted 47 people allegedly associated with illegal gambling establishments that were closely tied to gangs, drugs and violence and had become magnets for a wide variety of criminal activity.  Many were charged with Felon in Possession of a Firearm and felon in possession of ammunition. In all, 35 people were arrested, and 44 firearms, more than 12 pounds of methamphetamine, $263,000 in cash, and 640 gambling machines were seized during the two-year investigation. Please see https://www.justice.gov/usao-sdca/pr/forty-seven-defendants-charged-illegal-gambling-and-drug-indictments.
   
• In May 2021, 23 documented gang members and associates were charged with heroin, methamphetamine and firearms trafficking. This yearlong investigation involved federal wiretaps, dozens of undercover drug and gun buys and extensive surveillance. Many of the defendants are documented members or associates of violent South Bay street gangs operating out of National City, San Ysidro, and elsewhere. Many of these gang have long-standing ties to the Mexican Mafia. In total, authorities seized 2.1 kilograms of methamphetamine, 160 grams of heroin, and nine firearms tied to these defendants during the investigation. Please see https://www.justice.gov/usao-sdca/pr/twenty-three-gang-members-charged-crackdown-south-bay-heroin-methamphetamine-and.
   
• In June 2021, 60 alleged members of a San Diego-based international methamphetamine distribution network tied to the Sinaloa Cartel were charged with drug trafficking, money laundering and firearms offenses. In addition to these arrests, law enforcement has seized more than 220 pounds of methamphetamine and other illegal drugs; 90 firearms; and more than $250,000 in cash. Please see https://www.justice.gov/usao-sdca/pr/sixty-defendants-charged-nationwide-takedown-sinaloa-cartel-methamphetamine-network.

The federal effort to fight violent crime is not limited to prosecutions.  “We are using every tool – not just enforcement, but also prevention and intervention – to make our community safer,” Grossman said. “One of our greatest weapons in combatting violent crime is to combine proven law enforcement methods and expertise with the resources of credible “lived experience” messengers and trusted community organizations.”

To that end, the district’s Project Safe Neighborhoods Task Force has made an unprecedented investment in public safety by awarding more than $1 million in federal over the last two years for distribution to local law enforcement and community organizations to prevent gun violence, facilitate reentry, reduce gang membership, foster safer neighborhoods and research/measure program effectiveness.  The most recent grants, approved by DOJ’s Bureau of Justice Assistance last week, include:

• The San Diego City Attorney’s Office received money to help fund its Gun Recovery Impact Program, known as GRIP, which proactively seeks Gun Violence Restraining Orders, a life-saving tool created by California’s “red flag” law to prevent predictable acts of gun violence by removing firearms from individuals who pose a threat to themselves or others. Following a hearing in open court, a judge can prohibit the individual from possessing or purchasing firearms or ammunition for at least one year.
   
• Rise Up Industries’ (RUI) Reentry Program opened in Santee in March 2016. It helps previously incarcerated, formerly gang-involved individuals to successfully reenter society; thereby reducing the gang population and the recidivism rate. RUI’s Reentry Program provides comprehensive services including employment, job-training, case management, tattoo removal, counseling, mentoring, education assistance, financial literacy, life skills training, and work ethic development. RUI pays full-time wages to Reentry Program members as they work their way through the program. 
   
• San Diego Association of Governments, the regional clearinghouse for crime data, received a grant to enhance its tracking of crimes that involve firearms around the region. This would include the use of a firearm in violent crime and providing information regarding where these crimes are occurring, tracking calls for service related to the use of firearms, and interviewing arrestees regarding their use of firearms and ghost guns.
   
• Vista Community Clinic received a grant to support its “Resilience” program, which helps justice system-involved youth chart a more positive life course. The program serves teens in the City of Oceanside which faces challenges created by multiple gangs with hundreds of members, many of them minors.

The PSN Task Force awarded additional grants in prior months to several mentoring and/or reentry organizations, including Boys & Girls Club of Oceanside; Education COMPACT; El Centro Police Athletic League; the Imperial County Gang Intelligence Coalition; Inner City Athletics; Reality Changers; Star Pal; UPAC; Vista Community Clinic and Youth Empowerment. Moreover, the Kroc Institute for Peace and Justice received a research grant to recommend data collection protocols, measure program effectiveness, and research best practices for “lived experience” mentoring programs.

In addition to PSN grants, the Southern District of California runs two prevention programs that focus on character building and mentoring.  Project LEAD – San Diego, an adaptation of the program started in Los Angeles, is an 8-week program designed to help fifth-grade students understand that the choices they make today can affect their lives forever. Since 2016, the U. S. Attorney’s office has recruited 286 volunteer teachers who have reached 2,816 students.  Several local and federal agencies were involved in this effort in addition to the U.S. Attorney’s Office, including: the U.S. Coast Guard, DEA, the San Diego City Attorney’s Office, the U.S. Marshals Service, Customs and Border Protection, U.S. Secret Service, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Food and Drug Administration, San Diego Police Department, U.S. Probation, Pretrial Services, the State Department, Department of Corrections, Homeland Security Investigations, and the Internal Revenue Service.

While currently on hold due to the pandemic, for more than five years the office also ran the Success Agents mentoring program at Porter Elementary. At the Success Agents weekly workshop, law enforcement mentors worked in a fun and interactive way to help 4th and 5th grade students improve life skills, build confidence and promote a positive relationship with law enforcement. The program also supports families through resource referrals, parent meetings and holiday dinners offered by program partners.

The U.S. Attorney’s office is also a longstanding member of the Community Assistance Support Team (CAST), an organization that works to prevent gang-related gun violence and support victims. By building relationships and communicating directly with gang members, residents and law enforcement, CAST volunteers identify the sources of gun violence in specific neighborhoods and connect individuals with the help they may need, such as gang exit resources, mental health services or alternative methods to resolving conflicts. During the recent violent crime spike, the office supported and participated in CAST Season of Peace events calling for an end to gun violence.

Assistant U. S. Attorneys Mario Peia and Alexandra F. Foster (619) 546-9706/6735

NEWS RELEASE SUMMARY – October 15, 2021

SAN DIEGO – A federal magistrate judge denied bond today for one of two Mexican nationals indicted by a federal grand jury in connection with the kidnapping and death of a 19-year-old San Diego man in May of 2020.

The defendant, Wyatt Valencia-Pacheco of Tijuana, is charged along with fugitive Jonathan Emmanuel Montellano-Mora, also from Tijuana. They were indicted on June 3, 2021, for Hostage Taking Resulting in Death, Conspiracy to Take Hostages Resulting in Death, and Intentional Killing While Engaged in Drug Trafficking. The indictment was unsealed last week.

According to the indictment, Valencia and Montellano worked with others to arrange the killing of the victim, M.A.R., as part of their methamphetamine importation and trafficking activities.

The indictment further alleges that Valencia and Montellano worked with others to kidnap, detain and threaten the victim at a location outside the United States, in order to compel the victim’s family to pay with money or methamphetamine to gain his release. The victim was ultimately killed.

At Valencia’s detention hearing today before U.S. Magistrate Judge Allison H. Goddard, the government provided greater detail as to Valencia’s alleged involvement. The government identified the victim as a 19-year-old U.S. citizen who had been arrested twice before for strapping drugs onto his body and attempting to cross into the United States through a port of entry. The victim was tortured and killed over the theft of three pounds of methamphetamine, the government told the court.  

At the hearing, the government provided the following chronology of the alleged crimes:

On May 28, 2020, the victim stole three pounds of methamphetamine from a drug trafficker connected to the defendants in Tijuana. Almost immediately after the theft, Valencia started sending the victim threats over Facebook Messenger, ordering the victim to return the drugs immediately or pay them $2,000. In Spanish, Valencia told the victim that he “fucked up” and now had to take responsibility, because “they only gave us two hours to pay for that shit.”

The victim asked for more time or a smaller payment, to which Valencia responded: “I don’t know how you’re going to do it, but I want it today.” The victim asked for Valencia to trust him and promised to pay later. Valencia replied, “I don’t give a fuck. You’ll see how I make you pay today.” Valencia even told others that he planned to kidnap the victim.

On May 29, 2020, approximately four hours after the victim was supposed to have crossed the drugs, Valencia was in conversation with a co-conspirator on Facebook Messenger, assuring the co-conspirator that he (Valencia) was in touch with the victim, and they would find him. Valencia assured his co-conspirator that the victim was scared.

About eleven hours later, at a little after 11 a.m. that same day, Valencia told a girlfriend that he was angry, because a guy stole “work” from him, and Valencia was looking for the guy. When asked why he was looking for the guy, Valencia answered, “because I’m going to kill him.” Valencia said he gave the guy until 5 p.m. to return and pay for the “work,” or else Valencia was “going to send people to his house … here and there … here I’m going to shoot it up.”

About an hour later, Valencia communicated with a co-conspirator to plan how best to kidnap the victim.

At 11:57 p.m. on May 29, 2020, three males forcibly took the victim from a hotel in Tijuana at gunpoint. The event was captured by hotel surveillance cameras. One of the kidnappers was wielding a gun, which he used to beat the victim.

In the early morning hours of May 30, 2020, the kidnappers began contacting the victim’s mother and stepfather to demand money (sometimes $2,000, other times $3,000) or methamphetamine. The hostage takers permitted the victim’s family to see him through FaceTime, as proof of life. The victim appeared bloodied and beaten.

During this same time, a co-conspirator asked Valencia, “Hey, dude, give us ideas where we can get him signed,” that is, where to kill the victim.  

After a few minutes, and after insisting that he did not want to get further involved, Valencia answered the previous question about “where can we get him signed.” Valencia offered, “Smoke the guy by the dam, dude. Or by Cerro Colorado. … Or in the canal. It’s around the corner.” The co-conspirator asked, “Which canal?” To which Valencia responded, “The one by La Rapida (laughs)”

The family’s last contact with the victim occurred on May 30, 2020, at 12:30 p.m. No one has heard from or seen the victim since that time.

At the close of the hearing, U.S. Magistrate Judge Goddard detained Valencia, finding that there were no conditions of release which would guarantee his return to court. She detained the defendant based on the nature and circumstances of the criminal activity, the lengthy period of incarceration which the defendant faced, the defendant’s use of weapons, the fact that he would be subject to immigration removal to Mexico if he were released from custody, his significant ties outside the United States, and the weight of the evidence against him.

“The narcotic netherworld is full of extreme danger and tragedy, and this case is no exception,” said Acting U.S. Attorney Randy Grossman. “A misguided young man tangled with the wrong people and paid a terrible price, and now his family lives with the unspeakable horror of their loss. We will always seek justice for victims of drug-related violence that destroys families, communities and futures.” Grossman thanked prosecutors Mario Peia and Alexandra Foster, as well as the investigating FBI agents, for their excellent work on this case.

“The FBI will vigorously pursue justice for U.S. citizens who fall victim to violence regardless of where the crime occurs,” said FBI Special Agent in Charge Suzanne Turner. “The victim was killed over a $2,000 drug debt. May these charges serve as a warning to those who think violence against U.S. citizens committed outside of the United States exempts them from prosecution here; It does not.”

Valencia is next in court on December 16, 2021, at 9 a.m. before U.S. District Court Judge William Q. Hayes. Montellano has not yet been apprehended.

DEFENDANTS                                            Case Number 21CR1683-WQH

Wyatt Valencia-Pacheco,

aka “JC HF,” aka “Jacob,” aka “Jacob Herrera”        Age: 21            Tijuana           

Jonathan Emmanuel Montellano-Mora,

aka “Che Cho” aka “Chori,”                                      Age: 22            Tijuana

SUMMARY OF CHARGE

21 USC Sec. 848(e) (1) (A) - Intentional Killing While Engaged in Drug Trafficking

Maximum Penalty: Life or Death Penalty; Mandatory Minimum: Twenty years in prison

18 USC Sec. 1203 - Hostage Taking Resulting in Death

Maximum Penalty: Life or Death Penalty; Mandatory Minimum: Life in prison

18 USC Sec. 1203 - Conspiracy to Take Hostages Resulting in Death

Maximum Penalty: Life or Death Penalty; Mandatory Minimum: Life in prison

INVESTIGATING AGENCY

Federal Bureau of Investigation

Special Assistant U.S. Attorney Nicole Bredariol (619) 546-8419  and Assistant U.S. Attorney Joshua Mellor (619) 546-9733

NEWS RELEASE SUMMARY – October 15, 2021

SAN DIEGO – Jose Rosario Segura Balentierra, a Colombian national interdicted by the United States Coast Guard on a semi-submersible vessel containing approximately 2,000 kilograms (4,4000 pounds) of cocaine, was sentenced on Tuesday in federal court to 200 months in prison for operating a semi-submersible vessel on the high seas twice in less than five years.

Balentierra was interdicted by United States Coast Guard Cutter BERTHOLF on a semi-submersible vessel with his three co-defendants on August 14, 2020, over 500 nautical miles from Central America.

The Defendants on the semi-submersible vessel failed to stop when ordered by the Coast Guard. The Coast Guard first tried warning shots, and then used disabling fire, shooting at the engines of the vessel to try to get the defendants to stop. When even this failed, one of the Coast Guard boarding officers jumped onto the moving vessel, took control of the engines, and removed the fuel lines to finally stop the vessel.

The Coast Guard observed two to three feet of water in the bottom of the semi-submersible vessel, indicating the defendants attempted to scuttle or sink the vessel to evade capture and seizure of its cargo. The semi-submersible vessel itself was stuffed with packages of cocaine, totaling over 2,000 kilograms (4,400 pounds) and worth over $35 million.

Balentierra was previously convicted in 2016 in the Southern District of Florida for Conspiracy to Operate and Embark on a Semi-Submersible Vessel Without Nationality with Intent to Evade Detection, and Operating and Embarking on a Semi-Submersible Vessel Without Nationality with Intent to Evade Detection. Similarly, in that case he was interdicted by the U.S. Coast Guard on a semi-submersible vessel approximately 300 nautical miles from Mexico. That semi-submersible vessel rapidly sunk to the bottom of the ocean floor and no drugs were recovered. He was sentenced to 41 months in custody and three years of supervised release. After serving his sentence he was deported to his home country of Colombia. In 2020, just over eighteen months after returning to Colombia, he engaged in this almost identical offense.

On July 14, 2021, Balentierra pleaded guilty to Possession of Cocaine with Intent to Distribute on Board a Vessel in violation of 46 U.S.C. § 70503 and Operation of a Semi-Submersible Vessel without Nationality in violation of 18 U.S.C. § 2285. On Tuesday he was sentenced to 182 months in custody and five years of supervised release on each of the charges, to run concurrently. He was also sentenced to 18 months in custody, to run consecutively, for violating the terms of his 2016 supervised release by engaging in trafficking cocaine. He was sentenced to a total custodial term of 200 months.

“The Pacific Ocean is not a freeway for drug traffickers,” said Acting U.S. Attorney Randy Grossman. “The sentence issued in this case sends a clear message that repeated maritime drug smuggling will not be tolerated in the Southern District of California.” Grossman thanked prosecutors Nicole Bredariol and Josh Mellor and the U.S. Coast Guard and San Diego Strike Force for their excellent work on this case.

“Due to the dedicated actions of the Coast Guard Cutter Bertholf’s commanding officer and crew, these smugglers have been brought to justice,” said Rear Adm. Brian Penoyer, the Eleventh Coast Guard District commander. “The Coast Guard kept $35 million worth of drugs off our streets, and we will continue to patrol the maritime domain to fight against the trafficking of narcotics.”

This case is the result of the ongoing efforts by the Organized Crime Drug Enforcement Task Force (OCDETF), a partnership that brings together the combined expertise and unique abilities of federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt, dismantle and prosecute high-level members of drug trafficking, weapons trafficking and money laundering organizations and enterprises.

DEFENDANT                                                           Case Number 20cr2671-LAB                                  

Jose Rosario Segura Balentierra                                 Age: 35                                               Colombia                                                           

SUMMARY OF CHARGES

Possession with Intent to Distribute Cocaine Onboard a Vessel Subject to the Jurisdiction of the United States – Title 46, U.S.C., Section 70503

Maximum Penalty: Life in prison and $10 million fine

Operation of a Semi-Submersible Vessel without Nationality, with Intent to Evade Detection –

Title 18, U.S.C., Section 2285

Maximum Penalty: Fifteen years in prison and $250,000 fine

AGENCY

United States Coast Guard

San Diego Strike Force
Organized Crime and Drug Enforcement Taskforce (OCDETF)

Assistant U. S. Attorney Larry Casper (619) 546-6734

NEWS RELEASE SUMMARY – October 14, 2021

SAN DIEGO – A money launderer for the Sinaloa Cartel was sentenced in federal court yesterday to 120 months in prison and a $50,000 fine for laundering approximately $15 million from the sale of methamphetamine, cocaine, and heroin that were smuggled into the United States by the Sinaloa Cartel.

Bianca Acedo-Ojeda, 34, of Sinaloa, Mexico, was extradited from Mexico to San Diego in November 2019, and on March 10, 2021, she pleaded guilty to conspiracy to commit money laundering. According to court documents, Acedo-Ojeda agreed with others to and did arrange for the drug proceeds in the form of U.S. bulk currency to be smuggled into Mexico through ports of entry in Southern California in vehicles with hidden compartments. She also agreed with others to and did arrange for much of the U.S. bulk currency to be converted into Mexican pesos and transferred to drug traffickers.

“Those who launder funds in support of the Sinaloa Cartel’s efforts to flood our borders with deadly drugs will face justice in this district,” said Acting U.S. Attorney Randy Grossman for the Southern District of California. “Stopping the flow of funds to one of the most violent criminal organizations in the world is essential to disrupting their narcotics trafficking and other criminal efforts.”

“Money launderers are the lifeblood of criminal organizations,” said Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division. “We will continue to vigorously prosecute money launderers associated with violent transnational drug trafficking organizations such as the Sinaloa Cartel. I want to thank the Government of Mexico for extraditing Acedo-Ojeda to the United States to face criminal charges. Through such partnerships, we will attack and work to dismantle dangerous drug cartels and their money laundering facilitators.”

“This investigation and prosecution serve as a prime example of how Homeland Security Investigations (HSI) and federal prosecutors work together to bring down those involved in large scale money laundering in support of international drug trafficking organizations,” said Special Agent in Charge Chad Plantz for HSI San Diego. “HSI will continue to identify and investigate criminal organizations who seek to exploit our borders in furtherance of their illicit activity – if you engage in illegal finance activity to aid drug cartels, you will be caught and prosecuted.”

Six other defendants, including Acedo-Ojeda’s brother, have previously pleaded guilty in this case and been sentenced (Omar Ayon-Diaz; Osvaldo Contreras-Arriaga; Joel Acedo-Ojeda; Cesar Hernandez-Martinez, Gibran Rodriguez-Mejia, and Oscar Rodriguez-Guevara). Another defendant, Robert Gallegos-Lechuga, pleaded guilty to conspiracy to commit money laundering and is pending sentencing. In addition, approximately 20 other individuals linked to the conspiracy who served as drug and money couriers and drug stash house operators have entered guilty pleas and been sentenced in related cases. 

The investigation was conducted by Homeland Security Investigations. The Justice Department's Office of International Affairs worked with law enforcement partners in Mexico to secure the arrest and extraditio of Acedo-Ojeda in Mexico.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

The case is being prosecuted by Assistant U.S. Attorney Larry Casper of the U.S. Attorney’s Office for the Southern District of California and Senior Trial Counsel Mark Irish of the Criminal Division’s Money Laundering and Asset Recovery Section.

DEFENDANTS                                             Case Number 15cr950-BEN                           

Bianca Acedo-Ojeda                                      Age: 34                       Sinaloa, Mexico

SUMMARY OF CHARGES

Money Laundering Conspiracy – Title 18, U.S.C., Section 1956(h)

Maximum penalty: Twenty years in prison and $500,000 fine

AGENCY

Homeland Security Investigations

NEWS RELEASE SUMMARY – October 8, 2021

            SAN DIEGO – Perry Edward Davis, aged 45, of San Diego, California was convicted by a federal jury yesterday of distributing the fetanyl that resulted in the death of Joshua Chambers, who was 25 years old when he overdosed. The verdict, delivered after less than two hours of jury deliberations, followed a trial before U.S. District Judge Larry A. Burns. 

            Chambers was one of three individuals who collapsed on December 21, 2019, at approximately 2:30 a.m., outside the QuarterDeck Cocktail Bar in El Cajon, with surveillance footage capturing the entire scenario. Paramedics and first responders quickly identified the mass-collapse as an opioid overdose and administered Narcan – a medication designed to reverse the effects of an opioid overdose – to all three subjects. Two of the individuals were revived and recovered, but Chambers never regained consciousness. He was declared deceased at approximately 3:39 a.m.

            The investigation revealed that the three individuals had ingested what they believed was cocaine by snorting a “line” in Chambers’ vehicle shortly before each collapsed. Laboratory testing of a baggie found in the vehicle showed that the baggie contained cocaine mixed with fentanyl.            

             Through text messages, cell-site location data, witness interviews and other evidence, investigators determined that, shortly before the three collapsed, at approximately 1:45 a.m., Chambers and one of the individuals who later collapsed travelled to a location near Perry Davis’ residence in the Clairemont area, at which point Davis supplied Chambers with the baggie containing the deadly fentanyl mixture. Chambers and the other individual then returned to the parking lot of the QuarterDeck where they, along with a third person, used the substance. Investigators also learned that Davis was Chambers’ regular cocaine dealer and had sold cocaine to Chambers in the same location on other occasions. At trial, the defense contended that the evidence was insufficient to demonstrate that Davis had supplied Chambers with the baggie containing the deadly fentanyl mixture and that Chambers’ death may have resulted from a potentially deadly cocaine/alcohol mixture and not from the fentanyl. 

            A Board Certified Medical Toxicologist/Emergency Medine doctor called by the Government testified that the actual cause of Chambers’ death was the fentanyl and that, but for his use of the fentanyl, Chambers would not have died. Explaining his conclusion, the expert relied – in part – on the surveillance footage of the collapses, which he testified reflected classic symptoms of an opioid overdose. As to the source of the fentanyl mixture, the texts and phone calls between Chambers and Davis reflected that they met less than an hour before the collapses and witness testimony established that it was during that meeting that Chambers bought the baggie that he believed contained only cocaine. 

            “Davis endangered three young adults and caused a mass overdose when he sold Joshua Chamber cocaine laced with deadly fentanyl,” said Acting U.S. Attorney Randy Grossman.  “While our dedicated first responders were able to save two lives, Davis must be held to account for the death of Joshua, whose family and friends will bear the devastating weight of his loss for the rest of the lives.”  Acting U.S. Attorney Randy Grossman praised prosecutors Larry Casper and Shauna Prewitt as well as the El Cajon Police Department, the Drug Enforcement Administration and agents from Narcotics Task Force Team 10, a multi-agency team that was created in July 2018 to address drug overdose deaths in San Diego, for their efforts on this case. 

            Davis is set to be sentenced on January 10, 2022, by Judge Burns. This case was handled in court by Assistant United States Attorneys Larry Casper and Shauna Prewitt.

DEFENDANT                                   Case Number 20-CR-2500-LAB                                                    

Perry Edward Davis               Age: 45                       San Diego, California

SUMMARY OF CHARGE TO WHICH GUILTY PLEA ENTERED

Distribution of Fentanyl Resulting in Death – Title 21 U.S.C. Section 841(a)(2) and (b)(1)(C)

Maximum Penalty – Mandatory Minimum of 20 years and a maximum of life

INVESTIGATING AGENCIES

El Cajon Police Department

Narcotics Task Force Team 10

 

SAN DIEGO – A former U.S. Army helicopter pilot-turned-civilian-contractor appeared in federal court in San Diego yesterday to face charges that when he was required to make disclosures during national security background checks, he failed to disclose that he repeatedly met with - and received cash payments from - a Chinese national linked to intelligence services.

Shapour Moinian, 66 years of age from Mira Mesa, worked for many years for various defense contractors and also as a civilian contractor for the U.S. Navy and was subjected to multiple national security background checks. According to a complaint and disclosures made at his initial appearance and bond hearing, Moinian made false statements on these questionnaires, asserting repeatedly that he did not have any contact with foreign nationals.

In 2017, Moinian was communicating with a Chinese National, who posed as a recruiter on a job-services platform in a manner that both Germany and France have publicly identified as a technique used by Chinese intelligence services. Thereafter, Moinian traveled to China where in March 2017, while working at a cleared defense contractor on various projects, including a high-altitude, unmanned surveillance aircraft used by the U.S. Military and various allies. Upon returning, Moinian continued to communicate with his Chinese contact and update her on the progress of his work for her. In September 2017, Moinian again traveled overseas and met with his Chinese contact. Following this meeting, Moinian used a relative’s South Korean bank account to receive payment from his Chinese contact, which he then had wired to him in the United States.

In 2017, in the midst of his communications, visits, and working for his Chinese contact, Moinian completed a Questionnaire for National Security Background Investigations, where it is alleged he made knowingly and willfully materially false, fraudulent, and fictitious statements and representations, when he stated that he had not had close or continuing contact with a foreign national and had not been asked to work as a consultant, or consider employment by a foreign national, within the past seven years.

In 2018 after returning from another overseas meeting with his Chinese contact and her associates, where he received a cash payment, Moinian conducted searches using an internet search engine for sabotage, espionage, spying, and selling military information to a foreign country. In June 2019, Moinian requested a $20,000 payment from his Chinese contact, telling her that it was for a friend. In August of that year, Moinian traveled overseas to meet with his Chinese contact and others, where he received a large cash payment.

In 2020, when completing another Questionnaire for National Security Background Investigations, it is alleged Moinian made knowingly and willfully materially false, fraudulent, and fictitious statements and representations, when he reaffirmed that he had not had close or continuing contact with a foreign national and had not been asked to work as a consultant, or consider employment by a foreign national, within the past seven years.

Moinian, a former helicopter pilot for the U.S. Army, continued his work for various defense contractors while communicating and meeting with his Chinese contact and her associates, who provided him with cash payments that he smuggled back into the United States. These meetings, and payments, occurred in multiple overseas locations, including Hong Kong, Macau, Bali, and Taiwan. In addition to cash payments at these meetings, Moinian also received at least one other payment from his Chinese contact that he funneled through his relative’s South Korean bank account.

At the time of his arrest on October 1, 2021, Moinian was working for another cleared defense contractor and was slated to relocate to South Korea to work on a military aircraft being produced for that country. When he was arrested, Moinian had already provided many of his belongings to a company to transport to South Korea, and given notice that he was vacating his apartment the following week. Although these charges have been filed, the investigation is continuing by both the FBI and NCIS.

“The complaint alleges a disturbing failure to reveal information highly relevant to the background clearance process,” stated Acting United States Randy Grossman.  “This office is committed to ensuring that individuals in sensitive national security positions are worthy of the trust placed in them.”  Grossman commended the work of AUSA Fred Sheppard, DOJ’s National Security Division and the FBI and NCIS agents who diligently pursued this matter.

“This case serves as a stark reminder of the social media exploitation strategies Chinese intelligence agencies will utilize to target, recruit, and maintain contact with valuable foreign assets,” said FBI Special Agent in Charge Suzanne Turner. “Let this arrest serve as a deterrent to those who may consider hiding their foreign contacts in the hopes they can live a double-life and not get caught.”

“Mr. Moinian’s alleged false statements on security background forms about his contact with foreign nationals posed a significant threat to our national security,” said Special Agent in Charge Michelle Kramer of the NCIS Office of Special Projects. “This arrest should serve as a warning that NCIS and our law enforcement partners remain committed to rooting out any and all criminal attempts to compromise our nation’s national security interests. We sincerely thank our partners for their substantial efforts during this investigation to preserve U.S. warfighter superiority.”

This case was investigated by the Federal Bureau of Investigation and the Naval Criminal Investigative Service, and is being prosecuted by the U.S. Attorney’s Office for the Southern District of California and the Department of Justice’s National Security Division.

DEFENDANTS                                         Case Number             21MJ3884

Shapour Moinian                                       Age: 66                      San Diego

SUMMARY OF CHARGES

Title 18, United States Code, Section 1001 (Materially false, fictitious, or fraudulent statement or representation)

Maximum penalty: Fine and prison term of up to five years.

INVESTIGATING AGENCIES

Federal Bureau of Investigation

Naval Criminal Investigative Service

*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.