Southern District of California
Press releases recorded for this federal judicial district.
Oceanside Drug Dealer Sentenced to 10 YearsRead the Press Release
NEWS RELEASE SUMMARY – June 17, 2024
SAN DIEGO – Sean Keenan O’Connor of Oceanside was sentenced in federal court to 10 years in prison for money laundering, and firearms and drug trafficking offenses, including distribution of fentanyl, cocaine, methamphetamine, marijuana and alprazolam.
According to O’Connor’s plea agreement, deputies with the San Diego Sherriff’s Department executed court-authorized search warrants on the defendant’s residence and car on February 28, 2023. Deputies seized a semi-automatic pistol; 2,617 fentanyl tablets; 209 methamphetamine tablets; 24.19 grams of cocaine; 4,384 alprazolam tablets; and 1,549 grams of marijuana. Deputies also seized about $150,000 in U.S. currency and 0.27 in Bitcoin – which he has admitted were proceeds from drug trafficking.
According to the United States’ sentencing memorandum, the defendant demonstrated callousness and extreme disregard for human life. In one text exchange, he called people who overdose on fentanyl “dummies” and bragged on social media about the product he was selling and the amount of money he was making through drug dealing. He also posted photographs of himself on Instagram with cash and drugs.
“This significant sentence of a prolific North County drug dealer is a meaningful victory for public safety,” said U.S. Attorney Tara McGrath. “By removing dangerous criminals, weapons, and drugs from our streets, we are ensuring a safer community for all.”
“This convicted criminal will spend a decade in prison allowing him the opportunity to think of his reckless actions uncovered by special agents with HSI and our partner agencies,” said Christopher Davis, acting special agent in charge for HSI San Diego. “HSI prioritizes protecting communities against illicit drugs and activity that cause irreparable damage to those involved. HSI is determined to apply all the tools in our investigative arsenal to counter the fight against drugs.”
This case was prosecuted by Assistant U.S. Attorney Sarah Akhtar.
This prosecution was a result of the efforts of the Fentanyl Abatement Suppression Team (FAST). Formed in September 2022, the group known as FAST is a multi-agency task force led by Homeland Security Investigations working in conjunction with state and local agencies to target significant fentanyl distributors in San Diego County. FAST is an initiative under the San Diego Imperial Valley HIDTA, whose mission is to identify and disrupt fentanyl smuggling and distribution networks in San Diego County.
DEFENDANT Case Number: 23-cr-1034-TWR
Sean Kennan O’Connor 22 Oceanside, CA
SUMMARY OF CHARGES
Possession of a Firearm in Furtherance of a Drug Trafficking Crime (18 U.S.C. § 924(c)(1)
Mandatory Minimum: Five years in prison and Maximum penalty: Life in prison
Possession with Intent to Distribute Fentanyl, Cocaine, Methamphetamine, Alprazolam, Marijuana (21 U.S.C. § 841(a)(1)); Maximum penalty: Twenty years in prison
Conspiracy to Launder Monetary Instruments (18 U.S.C. § 1956(h)); Maximum penalty: Twenty years in prison
AGENCIES
Homeland Security Investigations
U.S. Customs and Border Protection
San Diego Sherriff’s Department
San Diego District Attorney’s Office
Naval Captain Convicted by Federal Jury of Cyberstalking and Identity TheftRead the Press Release
NEWS RELEASE SUMMARY – June 14, 2024
SAN DIEGO – U.S. Navy Captain Theodore E. Essenfeld was convicted by a federal jury today of cyberstalking and stealing the identity of his former girlfriend.
During the four-day trial, the United States presented evidence that Essenfeld created imposter accounts with Facebook, LinkedIn, email, and cellular phone accounts using the woman’s name, biographical information, and photographs without her knowledge or consent. Posing as the victim, Essenfeld posted erotic and sexually explicit content to the Facebook account, as well as graphic media files or “memes.”
In addition to the materials posted on the imposter Facebook account, the United States presented evidence that Essenfeld joined Facebook dating groups using the imposter account and interacted with numerous other Facebook users while impersonating the victim, including “liking” other users’ posts, sending messages with kissy-face emojis, and sending group messages. Essenfeld linked the imposter Facebook and LinkedIn accounts to the victim’s prospective employer by following and engaging with the prospective employer’s social media accounts. He also linked the fake accounts to other aspects of the victim’s life by “liking” posts by her former co-workers, her university, the U.S. Navy, and fitness studios she previously attended.
Over 1,200 Facebook users ultimately became “friends” with the imposter account, including the victims’ former colleagues. The evidence showed that the victim reported the imposter account to Facebook over 400 times, but Facebook refused to take down the account because it appeared more authentic than the victim’s actual account due to the volume of images and level of Essenfeld’s engagement on the platform.
“The impact of cyberstalking can be as crushing as a physical blow,” said U.S. Attorney Tara McGrath. “Thanks to the persistent courage of this victim, the jury saw the damage Mr. Essenfeld inflicted in every aspect of her life – from her workplace to her gym – and today, they held him accountable for his acts of deceit and destruction.”
“Mr. Essenfeld deserves to be held to account for his cruel campaign to stalk, harass, and intimidate his victim,” said Special Agent in Charge Nicholas Carter of the NCIS Southwest Field Office. “NCIS and our law enforcement partners remain committed to protecting victims of cyberstalking and rooting out criminality that threatens Department of the Navy readiness.”
This case is being prosecuted by Assistant U.S. Attorneys Sabrina Feve and Michael A. Deshong.
Essenfeld’s sentencing is scheduled for September 6, 2024, at 9:00 a.m. before U.S. District Judge Robert S. Huie.
DEFENDANTS Case Number 23cr0177-RSH
Theodore E. Essenfeld Age: 52 Chula Vista, CA
SUMMARY OF CHARGES
Count 1: Cyberstalking – Title 18, U.S.C., Section 2261A(2)(B)
Maximum penalty: Five years in prison and $250,000 fine
Count 2: Identity Theft – Title 18, U.S.C., Section 1028(a)(7)
Maximum penalty: Fifteen years in prison and $250,000 fine
AGENCY
Naval Criminal Investigative Service (NCIS)
Former University City High School Teacher Pleads Guilty to Attempted Enticement of a MinorRead the Press Release
NEWS RELEASE SUMMARY – June 13, 2024
SAN DIEGO – Sean Stevenson, a former high school science teacher at University City High School, pleaded guilty in federal court today, admitting that when he was still a teacher, he sought commercial sex with a 16-year-old girl.
Stevenson was arrested in October 2023 when he arrived for what he thought would be a sexual rendezvous with the underage girl. At the time he was unaware that he was communicating online with an undercover agent.
Stevenson’s alleged illicit activity was discovered during another sex trafficking investigation. According to his plea agreement, Stevenson used a voice-over-internet protocol (VOIP) line to negotiate by text message for commercial sex with a woman who identified herself as “Kash.” Stevenson offered Kash a fee to find a female under the age of 18 for Stevenson. In pertinent part, Stevenson made these statements to Kash via text: “I don’t suppose you know in[sic] younger girls I could pay u a premium for?”; “I pay u a finders fee and I pay her”; “The younger the better”; and “Just keep it in mind if you come across any high school age girls.” When Kash suggested an 18-year-old girl, Stevenson replied: “Not young enough.”
When Kash was arrested as part of the sex trafficking investigation, an undercover officer continued the online conversation with Stevenson. Believing he was still speaking with Kash, when the undercover officer offered a 16-year-old cousin for commercial sex with Stevenson, he replied: “Oh ... yes!” Stevenson continued to exchange messages with the undercover officer, negotiating $150 for a “bbbj” (oral copulation without a condom); $100 for manual genital stimulation; a “car date” (a commercial sex encounter that occurs inside a vehicle). The exchange continued, with Stevenson stating, “Ok. Well I’m interested in her for sure!” He asked for a “sexy pic,” negotiated a $140 fee and arranged to meet up.
On October 24, 2023, at approximately 7 a.m., Stevenson arrived at the pre-arranged meet up location. He drove to a parking lot where he had a full unobstructed view of the meeting location. He then drove laps around a nearby apartment complex where he expected to meet the 16-year-old. Stevenson was stopped by law enforcement officials and placed under arrest. During the arrest, $140 was located in the driver’s side door storage area of Stevenson’s Mazda Miata.
“Instead of a protector, this teacher became a predator,” said U.S. Attorney Tara McGrath. “These despicable acts betray the trust of students, parents, and the entire community. Yet through swift justice in this case we have continued to protect children from being exploited, trafficked, and abused.”
“Mr. Stevenson was a trusted member of the community who preyed upon our most vulnerable youth,” said Christopher Davis, acting special agent in charge for HSI San Diego. “HSI is fully committed to working with our law enforcement partners to rescue victims and aggressively investigate allegations of human trafficking and sexual exploitation of children. We encourage anyone who has information related to human trafficking and sexual exploitation of children to report it to law enforcement immediately.”
Stevenson is scheduled to be sentenced on September 5, 2024, at 9 a.m. before U.S. District Judge Anthony J. Battaglia.
This case is being prosecuted by Assistant U.S. Attorneys Derek Ko and Andrew Sherwood.
Anyone with information about this case is urged to contact San Diego County Crime Stoppers (888-580-8477) and the National Human Trafficking Hotline (888-373-7888).
DEFENDANTS Case Number
Sean Stevenson Age: 58 San Diego, CA
SUMMARY OF CHARGES
Attempted Enticement of a Minor– Title 18, U.S.C., Section 2422(b)
Maximum penalty: Life in prison, 10-year mandatory minimum
INVESTIGATING AGENCIES
Homeland Security Investigations
San Diego Human Trafficking Task Force
Nonprofit Organizations Pay over $5.8 Million to Resolve Allegations of Fraudulently Obtaining Pandemic-Related LoansRead the Press Release
NEWS RELEASE SUMMARY – June 12, 2024
SAN DIEGO – Multiple nonprofit organizations—including two private country clubs and two homeowners associations—have paid $5,809,021.60 to settle allegations that they violated the False Claims Act by knowingly submitting false claims and obtaining Paycheck Protection Program loans for which they were not eligible.
Congress created the Paycheck Protection Program loans, known as PPP, in March 2020, as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, to provide emergency financial support to the millions of Americans suffering the economic effects caused by the COVID-19 pandemic. The CARES Act authorized billions of dollars in forgivable loans to small businesses struggling to pay employees and other permitted business expenses. Under the CARES Act, certain entities organized under section 501(c) of the Internal Revenue Code were not eligible for PPP loans.
Rancho Santa Fe Association is a homeowners association and 501(c)(4) nonprofit organization. Rancho Santa Fe Association serves members in the community of Rancho Santa Fe in San Diego County, which includes over 4,000 residents, the Rancho Santa Fe Golf Club, the Rancho Santa Fe Tennis Club, private sports fields, The Inn at Rancho Santa Fe, nearly 60 miles of private equestrian and pedestrian trails, shops, restaurants, and full-time security patrol. In April 2020, Rancho Santa Fe Association applied for a PPP loan and later received disbursement of a $1,542,100 loan. The United States contended that Rancho Santa Fe Association knew or should have known it was not eligible to receive its PPP loan as a 501(c)(4) nonprofit organization, and it caused the Small Business Administration (SBA) to forgive the loan and to pay lender fees and interest to the bank that processed the loan. Rancho Santa Fe Association paid $2,037,451.44 to settle allegations that it knowingly violated the False Claims Act.
Pine Mountain Lake Association, a homeowner’s association and 501(c)(4) nonprofit organization, is in Groveland, California near Yosemite National Park. Pine Mountain Lake Association is a gated community with amenities that include a private lake with six miles of shoreline, 18-hole championship golf course, swimming pool, tennis and pickleball courts, hiking trails, archery range, equestrian center, restaurant and lounge, and lake lodge. In April 2020, Pine Mountain Lake Association applied for a PPP loan and later received disbursement of a $687,500 loan. In January 2021, Pine Mountain Lake Association applied for a second PPP loan and later received disbursement of a $950,000 loan. The United States contended that Pine Mountain Lake Association knew or should have known it was not eligible to receive its PPP loans as a 501(c)(4) nonprofit organization, and it caused the SBA to forgive the loan and to pay lender fees and interest to the bank that processed the loans. Pine Mountain Lake Association paid $2,372,440.98 to settle allegations that it knowingly violated the False Claims Act
Glendora Country Club, a private country club and 501(c)(7) nonprofit organization, is in San Gabriel Valley and offers its members an 18-hole golf course, a 25-yard swimming pool, and dining and entertainment options. In April 2020, Glendora Country Club applied for a PPP loan and later received disbursement of a $471,685 loan. The United States contended that Glendora Country Club knew or should have known it was not eligible to receive its PPP loan as a 501(c)(7) nonprofit organization, and it caused the SBA to forgive the loan and to pay lender fees and interest to the bank that processed the loan. Glendora Country Club paid $708,843.42 to settle allegations that it knowingly violated the False Claims Act.
The Palms Golf Club, a private, single membership golf club and a 501(c)(7) nonprofit organization, is in La Quinta, California. The Palms Golf Club claims to offer a world-class golfing environment with a golf course designed by Fred Couples, state-of-the-art practice facility, locker rooms and fitness facilities, and multiple dining options. In May 2020, The Palms Golf Club applied for a PPP loan and later received disbursement of a $327,035 loan. The United States contended that The Palms Golf Club knew or should have known it was not eligible to receive its PPP loan as a 501(c)(7) nonprofit organization, and it caused the SBA to forgive the loan and to pay lender fees and interest to the bank that processed the loan. The Palms Golf Club paid $690,285.76 on an ability-to-pay basis to settle allegations that it knowingly violated the False Claims Act.
“The PPP program was born from the urgent need to support small businesses weathering the storm of a generational pandemic,” said U.S. Attorney Tara McGrath. “These agreements hold accountable those who deceitfully diverted public funds from the deserving hands of struggling small businesses trying to support their employees and serve their customers.”
“Providing false information to obtain PPP loans and forgiveness is wrong,” said SBA OIG’s Western Region Special Agent in Charge Weston King. “Today’s settlement sends a strong message that attempts to wrongfully obtain loan fund and forgiveness will not go unnoticed, and violators will be identified. I want to thank the Department of Justice and our law enforcement partners for their support and dedication to pursuing justice in this case.”
The settlements resolve claims brought by Wade Riner under the qui tam or whistleblower provisions of the False Claims Act. Under these provisions, a private party can file an action on behalf of the United States and receive a portion of the recovery. The case is captioned United States ex rel. Riner v. Rancho Santa Fe Ass’n, et al., 22-CV-1285-GPC-KSC. Mr. Riner will receive a total share of nearly $700,000.
The resolution obtained in this matter was the result of a coordinated effort between the U.S. Attorney’s Office for the Southern District of California and the SBA’s Office of General Counsel and Office of the Inspector General. In total, the United States recovered over $6.1 million against the named defendant in the qui tam action.
This matter was handled by Assistant U.S. Attorney Dylan M. Aste.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
Customs and Border Protection Officer Convicted by Federal Jury of Receiving Bribes, Allowing Drug-Laden Vehicles to Enter the U.S.Read the Press Release
NEWS RELEASE SUMMARY – June 12, 2024
SAN DIEGO – Former U.S. Customs and Border Protection Officer Leonard Darnell George was convicted by a federal jury late Monday, June 10, of accepting bribes to allow vehicles containing methamphetamine and other illicit drugs to pass through the border into the U.S.
George was also convicted of allowing vehicles with unauthorized individuals to pass through his lane and into the U.S. while working for two separate criminal organizations.
During the trial, several witnesses testified that George agreed to allow drug-laden vehicles enter the U.S. through his lane in late 2021. George would notify members of the drug trafficking organization when he was at work, what lane he was on, and that they had one hour to reach his lane. However, in February 2022 after an alert placed by law enforcement agents on a suspected drug smuggling vehicle was flagged entering George’s lane, George was forced to send the vehicle to secondary revealing approximately 222 pounds of methamphetamine. Undeterred, George allowed a second drug-laden vehicle affiliated with the drug trafficking organization and traveling directly behind the flagged vehicle enter the U.S. with over 200 pounds of drugs. Text messages sent by George the following day reveal he received approximately $13,000 for the vehicle he allowed to enter the U.S. On the same day he received his bribe payment, George purchased a 2020 Cadillac CT5 for an associate of the drug trafficking organization as a gift. George delivered the Cadillac CT5 to the associate in Ensenada on Valentine’s Day.
Over the course of six months, George continued to allow vehicles containing drugs and undocumented individuals to enter the U.S. through his lane.George repeatedly omitted passengers and the true names of drivers coming through his lane, instead entering the names of others to conceal his criminal activities. Law enforcement agents and prosecutors identified approximately 19 crossings associated with the criminal organizations during the six-month time period. Text messages confirmed George agreed to allow vehicles through his lane for $17,000 per vehicle, $34,000 for two vehicles, $51,000 for three vehicles, or $65,000 for four vehicles. One text message confirmed that George received $68,000 after he allowed four vehicles from one organization to enter his lane in June 2022.
Testimony from a witness confirmed that George purchased vehicles, motorcycles, and jewelry with the proceeds of his illicit activities. Additionally, on George’s days off, he travelled to Tijuana to visit Hong Kong Gentlemen’s Club where he spent approximately $5,000 per trip. He would stand on the second level of the club and throw cash over the balcony to the dancers below, “showering” them with money. He would buy bottles of alcohol, and occasionally gifts, for dancers.
The extent of George’s relationship with traffickers revealed itself when prosecutors admitted a photograph of one of George’s trafficking associates taking a selfie in George’s CBP uniform jacket.
“With this verdict, the jury sent a clear message to anyone considering trading in their badge for cash,” said U.S. Attorney Tara K. McGrath. “Abandoning the integrity of the uniform for the conspiracy of drug trafficking is a path to a criminal conviction.”
“As persons in positions of public trust, we are relied upon to serve and protect the American people,” said FBI San Diego Special Agent in Charge, Stacey Moy. “We also rely on each other to uphold that sacred oath. Should that oath be violated, the FBI and it's law enforcement partners remain steadfast in our pursuit of justice, even if it means holding ourselves accountable.”
“CBP does not tolerate misconduct within its ranks,” said Special Agent in Charge Elizabeth Cervantes of CBP’s Office of Professional Responsibility, San Diego Field Office. “The Office of Professional Responsibility’s efforts in this case and this latest court decision are a testament to CBP’s commitment to preserving the honor of its overwhelmingly professional workforce, and to its core values of vigilance, integrity, and service to country.”
“Today’s conviction shows HSI’s and our law enforcement partners dedication to dismantling criminal organizations and holding those criminals that enable their illicit activity accountable,” said Chris Davis, Special Agent in Charge for Homeland Security Investigations in San Diego. “There is no place in law enforcement for those who dishonor their badge and oath to protect our communities and our country.”
“The Department of Homeland Security Office of the Inspector General is grateful for the continued collaboration with our law enforcement partners as we fight corruption along our Southern Border,” said Inspector General Joseph V. Cuffari. “This guilty verdict sends a clear message that federal employees who violate the law will be held accountable for their actions.”
The case was tried and prosecuted by lead Assistant U.S. Attorney Bianca Calderon-Peñaloza and Assistant U.S. Attorney Brandon J. Kimura.
George’s sentencing is scheduled for September 13, 2024, at 9 a.m. before U.S. District Judge Todd W. Robinson.
SUMMARY OF CHARGES Case Number 23CR1291
Receiving Bribe by Public Official – Title 18, U.S.C., Section 201
Maximum penalty: Fifteen years in prison
Conspiracy to Import Controlled Substances – Title 21 U.S.C., Sections 952, 960, 963
Maximum penalty: Life in prison with a 10-year mandatory minimum
Bringing in Certain Aliens for Financial Gain – Title 18 U.S.C., Section 371, Title 8 U.S.C., Section 1324(a)(2)(B)(ii)
Maximum Penalty: Ten years in prison
Bringing in Certain Aliens for Financial Gain – Title 18 U.S.C., Section 371, Title 8 U.S.C., Section 1324(a)(2)(B)(ii)
Maximum Penalty: Ten years in prison
INVESTIGATING AGENCIES
Federal Bureau of Investigation (FBI)
Department of Homeland Security – Office of Inspector General (DHS OIG)
Homeland Security Investigations (HSI)
Customs and Border Protection – Office of Professional Responsibility (CBP OPR)
Oceanside Drug Dealer Sentenced to 78 Months in Fatal Fentanyl Overdose of U.S. MarineRead the Press Release
NEWS RELEASE SUMMARY – June 11, 2024
SAN DIEGO—Jesse Sanders of Oceanside was sentenced in federal court to 6.5 years in prison for selling the fentanyl powder that resulted in the fatal overdose of a 29-year-old active-duty U.S. Marine.
According to the plea agreement, Sanders admitted that she arranged a meeting with the Marine and delivered a small plastic bag of fentanyl to the victim on January 2, 2022. At approximately 3 p.m. that day, military police and emergency medical services responded to an emergency call after the victim’s wife found him unresponsive in his parked vehicle onboard Marine Corps Base Camp Pendleton. A small plastic bag with a white, powdery substance was discovered in the front console of the vehicle.
According to the government’s sentencing argument, Sanders was addicted to fentanyl, knew how deadly the drug was, and knew the dangers it posed to users; she sold the deadly fentanyl to the victim with a warning to have naloxone on hand – a medicine that can rapidly reverse an opioid overdose - because the powder she was selling was strong. Within hours, the victim was found unresponsive and died from fentanyl toxicity.
Sanders has a history of narcotics-related criminality resulting from her substance abuse and drug addiction, according to the government’s sentencing memorandum. At the time she sold the deadly fentanyl powder to the victim, she was on summary probation from a San Diego Superior Court conviction and still has an additional pending felony case for robbery.
The victim received an Afghanistan Campaign Medal, a NATO International Security Assistance Force Medal, a Global War on Terrorism Service Medal, and multiple Sea Service Deployment Ribbons, certificates of commendation, and letters of appreciation. He was a trained combat marksmanship coach and martial arts instructor.
He was described by family as “patient, caring, and hilarious” and “lit up any room he walked into.” Two weeks prior to his death, the victim and his wife celebrated their 10-year wedding anniversary.
“Fentanyl is so powerful, so toxic, so addictive, that it can snare even the toughest among us,” said U.S. Attorney Tara McGrath. “Today’s outcome cannot bring back this Marine, but it reflects the consequence for peddlers dealing this poison: prison.”
“The illicit distribution and use of fentanyl in the United States poses a critical threat to our local communities, our nation’s service members, and ultimately our national security,” said Special Agent in Charge Todd Battaglia of the NCIS Marine West Field Office. “The sentencing of Ms. Sanders for her role in the tragic death of a U.S. Marine should serve as a warning to criminals that NCIS and our partners will continue to work aggressively to bring to justice those who knowingly distribute lethal narcotics to service members.”
Special Agents with the U.S. Naval Criminal Investigative Service’s Major Case Response Team led the investigation as part of ongoing efforts by the U.S. Attorney’s Office to investigate and prosecute the distribution of illegal drugs—fentanyl in particular—that result in overdose deaths. The Naval Criminal Investigative Service and military commanders recognize the crucial role that drug use prevention plays in avoiding disastrous consequences for servicemembers and their families.
This case was prosecuted by Assistant U.S. Attorney Amy Wang and Special Asst. U.S. Attorney Arne Bussler.
DEFENDANT Case Number: 23-cr-00270-BAS
Jesse Sanders Age: 24 San Diego, CA
SUMMARY OF CHARGES
Distribution of Fentanyl – Title 18, United States Code, Section 841(a)(1)
Maximum penalty: Twenty years in prison
INVESTIGATING AGENCY
U.S. Naval Criminal Investigative Service
Former Navy Civilian Employee Pleads Guilty to Bribery Involving Government Contracts Worth Hundreds of MillionsRead the Press Release
NEWS RELEASE SUMMARY – June 11, 2024
SAN DIEGO – James Soriano of Las Vegas, Nevada, pleaded guilty in federal court yesterday to multiple bribery conspiracies, admitting that while he was a public official at Naval Information Warfare Center in San Diego, he accepted hundreds of thousands of dollars from defense contractors in the form of free meals, tickets to premier sporting events, jobs for family and friends, and other things, in exchange for helping those contractors win and maintain hundreds of millions of dollars in government contracts. Soriano also pleaded guilty to filing a false 2018 tax return in connection with the bribes he accepted.
According to Soriano’s plea agreement, the defense contractors – acting through their presidents, officers, and employees – gave various things of value to Soriano, including dinners at Ruth’s Chris, Island Prime, and Providence; tickets to the 2018 MLB All-Star Game, 2018 World Series, and 2019 Superbowl; and jobs for Soriano’s family and friends, including a member of Soriano’s family and Soriano’s family friend, Liberty Gutierrez, who was giving Soriano $2,000 a month from her salary at one of the companies working under a defense contract.
In return, Soriano took official action to aid his benefactors, such as allowing defense contractors to draft government documents in competitive and non-competitive procurements, submitting those documents as part of the procurement process, and advocating for their selection as defense contractors. Soriano also willfully failed to disclose the cash payments he received from Ms. Gutierrez on his federal tax returns.
According to Soriano’s plea agreement, from approximately March 2016 through at least October 2019, Soriano and a coworker, Dawnell Parker, received bribes from Philip Flores, the President and CEO of Intellipeak Solutions, Inc., a defense contractor headquartered in Fredericksburg, Virginia. Soriano also admitted that from approximately May 2015 through at least October 2019, he and Parker separately received bribes from another defense contractor, with offices in San Diego and Stafford, Virginia, who also gave him things of value, such as expensive meals, a job for his wife, and rounds of golf at private country clubs.
Further, according to Soriano’s plea agreement, from approximately June 2014 through at least October 2019, Soriano received bribes from Russell Thurston, the Vice President of Cambridge International Systems, Inc., a defense contractor headquartered in Arlington, Virginia. In return for these bribes, Soriano used various methods to steer contracts to these defense contractors and kept his contracting activities hidden from the Naval Information Warfare Center.
“The nation’s robust contracting apparatus relies on honesty and fairness,” said U.S. Attorney Tara McGrath. “This guilty plea demonstrates a commitment to the integrity of the system by holding accountable a defendant who lined his own pockets at the expense of taxpayers.”
“Mr. Soriano betrayed the trust the U.S. Navy placed in him by using his position to wrongfully enrich himself and others, ultimately at the expense of the Department of Defense and the American taxpayer,” said Bryan D. Denny, Special Agent in Charge for the Department of Defense Office of Inspector General, Defense Criminal Investigative Service, Western Field Office. “His guilty plea should act as a deterrent for others contemplating or attempting to misuse a position of public trust to subvert the integrity of the government’s acquisition process.”
“Mr. Soriano decided to put his own interests above U.S. Navy warfighters, trustworthy businesses, and our country’s taxpayers,” said Special Agent in Charge Greg Gross of the NCIS Economic Crimes Field Office. “Protecting the integrity of the Department of the Navy’s procurement process from individuals abusing their official position to unlawfully seek personal gain remains a core function for NCIS and our partners.”
“Exploiting a position of public trust to fraudulently access federal programs for personal gain is unacceptable,” said SBA OIG’s Western Region Special Agent in Charge Weston King. “This guilty plea underscores our relentless efforts to combat corruption, protect taxpayer dollars, and maintain the integrity of SBA programs. I would like to thank the U.S. Attorney’s Office and our law enforcement partners for their dedication to the pursuing justice in this case.”
“Mr. Soriano violated the trust placed in him to responsibly oversee a fair and competitive process in his role as a contracting officer,” said Special Agent in Charge Tyler Hatcher, IRS Criminal Investigation, Los Angeles Field Office. “Instead, Mr. Soriano selfishly exploited that trust for personal benefit, meanwhile undermining a contracting process that ensures warfighters are equipped to fight and win in a complex and ever-changing global security environment. CI is committed to working with our federal law enforcement partners to help protect our servicemembers from this sort of malign activity that diminishes national security.”
Soriano is next scheduled to appear before U.S. District Judge Todd W. Robinson for sentencing on September 6, 2024.
Intellipeak and Flores are charged with conspiracy to commit bribery and bribery in 23-cr-2282-TWR. Thurston is charged with conspiracy to commit bribery and bribery in 24-cr-341-TWR.
This case is being prosecuted by Assistant U.S. Attorneys Patrick C. Swan and Katherine E. A. McGrath (no relation to U.S. Attorney McGrath).
DEFENDANT Case Numbers 23-cr-2282-TWR-1 and 24-cr-341-TWR-1
James Soriano Age: 63 Las Vegas, NV
SUMMARY OF CHARGES
Conspiracy to Commit Bribery - Title 18, U.S.C., Section 371
Maximum penalties (per count): Five years in prison; $250,000 fine
False Statements in Tax Returns – Title 26, U.S.C., Section 7206(1)
Maximum penalties: Three years in prison; $100,000 fine
INVESTIGATING AGENCIES
Defense Criminal Investigative Service
Naval Criminal Investigative Service
Small Business Administration – Office of Inspector General
Internal Revenue Service Criminal Investigation
Department of Health and Human Services – Office of Inspector General
If you have information regarding fraud, waste, or abuse relating to Department of Defense personnel or operations, please contact the DoD Hotline at 800-424-9098.
Palomar Hospital Pays $250,000 for Diverting FentanylRead the Press Release
NEWS RELEASE SUMMARY – June 3, 2024
SAN DIEGO – Palomar Health, a California public health care district located in San Diego County, has paid $250,000 to resolve allegations of diversion of fentanyl from one of its facilities and failure to keep accurate records for fentanyl.
Palomar Health is California’s largest health care district, with campuses in Escondido and Poway. This settlement arises from a self-disclosure Palomar Health made to the U.S. Drug Enforcement Administration (DEA) that one of its employees may have diverted controlled substances.
The government investigated Palomar Health and concluded that vials of fentanyl were diverted from Pyxis machines—automated medication dispensing machines often used in hospital settings—located at Palomar Health’s Cardiac Catheterization Lab in Escondido. Specifically, the government concluded that over a five‑month period, numerous vials of fentanyl were diverted from the Pyxis machines and unused fentanyl was not properly disposed of.
In addition to paying $250,000 to resolve the government’s claims, Palomar Health entered into a Memorandum of Agreement with the DEA requiring Palomar Health to undertake additional measures to increase security, implement specialized training, and to handle controlled substances properly and safely.
“We commend self-reporting by those responsible for managing controlled substances and encourage others to notify law enforcement early to prevent needless harm,” said U.S. Attorney Tara McGrath.
“We value our relationships with our registrant population and encourage all of them to be diligent in preventing and catching diversion,” said Diversion Program Manager Rostant Farfan. “Keeping medications, like fentanyl, off of the street is the responsibility of all who work with controlled substances.”
This settlement was the result of a coordinated effort by the U.S. Attorney’s Office for the Southern District of California and the Drug Enforcement Administration.
To report a tip directly to a DEA representative regarding medical personnel writing suspicious opioid prescriptions and pharmacies dispensing large amounts of opioids, call (571) 324-6499 or visit the DEA’s website (https://www.deadiversion.usdoj.gov/tips-online.html) and click on “Rx Abuse Online Reporting.”
This case was prosecuted by Assistant U.S. Attorney Dylan M. Aste.
The claims resolved by the settlement are allegations only, and there has been no determination of liability.
Man Sentenced to 10 Years for Sex Trafficking a 16-Year-Old GirlRead the Press Release
NEWS RELEASE SUMMARY – June 6, 2024
SAN DIEGO – Deondre Demetris Porter of Victorville, California was sentenced in federal court to 10 years in prison for sex trafficking a 16-year-old girl who was physically assaulted and ejected from a moving car during an escape attempt.
Porter was indicted by a federal grand jury in May 2023 along with codefendant Aaliyah White. Porter pleaded guilty in February 2024 to one count of sex trafficking of a minor. The victim had been recruited by Porter just three days prior to the assault, which occurred on Easter Sunday in April 2023.
In that short time span, Porter trafficked the minor victim, transporting her from Victorville to San Bernardino and then to San Diego. In San Diego, Porter required the minor to engage in commercial sex in hotel rooms and also walk Roosevelt Avenue in National City to elicit commercial sex buyers. White assisted Porter in monitoring the minor victim’s commercial sex activity.
On April 9, 2023, the San Diego Police Department received a 911 call and reports from witnesses that a girl had been thrown from a vehicle, half-dressed, and beaten up. As a result of her injuries, the minor victim was immediately transported to a hospital where she was treated and interviewed by officers from the San Diego Human Trafficking Task Force. The victim immediately identified Porter and White as her attackers and sex-traffickers.
The investigation determined that the vehicle in which the victim was beaten, stripped of some of her clothing and ultimately, ejected from, belonged to Porter. Further investigation discovered commercial sex ads posted by Porter advertising the minor victim, as an adult, for commercial sex on the websites Private Delights and MegaPersonals. After communicating with commercial sex buyers responding to the advertisements regarding the minor victim, Porter directed the victim to have sex with the buyers in San Diego. Hotel surveillance video also confirmed Porter’s trafficking of the minor victim.
“This child was exploited, assaulted and ejected from a moving car, and yet she still found the courage to speak out against her assailants,” said U.S. Attorney Tara McGrath. “Her bravery, combined with the work of an exceptional team of agents and prosecutors, brought this defendant to justice.”
“This lengthy sentence is a testament of HSI’s commitment to identifying a callus predator and rescuing a child victim from continued abuse,” said Christopher Davis, acting special agent in charge. “Along with our partner agencies, HSI will continue to devote resources to combat human trafficking.”
“The law enforcement community in San Diego remains dedicated to the rescue of sex trafficking survivors, as well as the aggressive prosecution for those responsible for these crimes,” said San Diego Police Chief David Nisleit. “This case is the culmination of tireless work by the San Diego Human Trafficking Task Force and the United States Attorney’s Office. This survivor suffered life-long damages at the hands of the accused. We must never forget the impact upon the vulnerable in these kinds of cases. The San Diego Police Department will continue to dedicate the necessary resources in our pursuit of justice and public safety.”
Co-defendant Aaliyah White is scheduled to be sentenced on June 10, 2024.
If you are living or working under threat of violence or extortion, or you suspect someone else may be, call the National Human Trafficking Resource Center toll free, 24/7 Hotline: CALL: (888) 373-7888 or TEXT BeFree or 233733.
This case was prosecuted by Assistant U.S. Attorneys Derek Ko and Lyndzie M. Carter.
DEFENDANTS Case Number 23-cr-0955-AGS
Deondre Demetris Porter Age: 26 Victorville, CA
SUMMARY OF CHARGES
Sex Trafficking of a Minor – Title 18, U.S.C., Section 1591(a) and (b)(1)
Maximum penalty: Up to life in prison and $250,000 fine; Ten-year mandatory minimum sentence
AGENCY
San Diego Police Department
San Diego County Probation Department
Homeland Security Investigations
San Diego Human Trafficking Task Force
California Department of Justice
Forty-Seven Defendants Charged in Imperial Valley Takedown of Drug Trafficking Network Linked to Sinaloa CartelRead the Press Release
NEWS RELEASE SUMMARY – June 5, 2024
EL CENTRO – Fourteen indictments were unsealed in federal court today charging 47 alleged members of an Imperial Valley-based, Sinaloa Cartel-linked fentanyl-and-methamphetamine distribution network with drug trafficking, firearms and money laundering offenses.
In a coordinated takedown this morning, more than 400 federal, state, and local law enforcement officials arrested 36 defendants and executed 25 search warrants in Imperial County, San Diego, Fresno, Los Angeles, Phoenix and Salem, Oregon. As of this afternoon, the search continues for 11 fugitives.
Including seizures today and throughout the long-term investigation, authorities have confiscated more than four kilograms of fentanyl, which amounts to about two million potentially fatal doses; more than 324 kilograms (over 714 pounds) of methamphetamine; significant quantities of cocaine and heroin; and 52 firearms, including handguns and rifles.
The investigation also resulted in the arrest of Alexander Grindley for alleged methamphetamine trafficking while employed as a U.S. Border Patrol agent, and multiple spin-off investigations in this district and others.
Crimes charged in the indictments include drug trafficking, money laundering and gun-related offenses. Court documents indicated the defendants were operating throughout the Imperial Valley—in Brawley, El Centro, Westmoreland, Imperial, Calexico, Niland, Holtville, Calipatria—and in Mexicali, Mexico.
“With this takedown, the Justice Department has dealt yet another blow to the Sinaloa Cartel and its associates,” said Attorney General Merrick B. Garland. “I am grateful to the more than 400 law enforcement officers whose work in this operation resulted in dozens of arrests, charges against 47 defendants, and the seizure of firearms, meth, cocaine, heroin, and two million potentially lethal doses of fentanyl. We will continue to be relentless in our fight to protect American communities from the cartels.”
“This investigation tore apart a drug trafficking network responsible for supplying dealers in communities across the region,” said U.S. Attorney Tara McGrath. “But there is still much work to be done. If you’re a parent, and today’s price of fentanyl terrifies you, talk to your kids about the dangers of drug use. If you’re an addict, and your dealer was arrested today, seek treatment. And if you’re a dealer but your supplier was arrested today, look out – we are coming for you next.”
“The Department of Homeland Security and our federal, state and local partners are unrelenting in our work to keep deadly fentanyl off our streets and bring those who traffic in it to justice,” said Secretary of Homeland Security Alejandro N. Mayorkas. “The indictments unsealed today are the direct result of our multipronged and coordinated law enforcement approach – one that utilizes all of our government’s resources and capabilities. Together, we are preventing fentanyl and other deadly drugs from being produced, distributed, or consumed, and saving countless lives.”
“Today’s coordinated operation, involving, over 400 federal, state, and local law enforcement officials, marks a decisive blow against an Imperial Valley-based, Sinaloa Cartel-linked distribution network and significantly disrupts the flow of dangerous drugs into our communities,” said Katrina W. Berger, Executive Associate Director for Homeland Security Investigations. “This operation is a testament to the power of law enforcement collaboration and our unwavering commitment to bringing these criminals to justice.”
“Today, the El Centro Border Patrol Sector teamed with allied law enforcement agencies to support both Homeland Security Investigations and the United States Attorney’s Office of San Diego in this operation,” said El Centro Sector Chief Gregory Bovino. “Our successful collaboration should be a reminder to criminal organizations in the Imperial Valley and elsewhere that justice will be served.”
“This operation shows what can be accomplished when there is collaboration between federal and local law enforcement agencies,” said Imperial County District Attorney George Marquez. “The Imperial County District Attorney’s office will continue to work together with our partners to bring to justice those that harm or are a danger to our community.”
According to the indictments and search warrants, the defendants belonged to various trafficking organizations that were part of an extensive network supplying all of Imperial County and beyond with dangerous drugs.
According to court records, on June 30, 2021, agents seized two pounds of methamphetamine and a cache of ghost guns and ammunition, including: 15 lower receivers, three upper receivers, multiple barrels and stocks, 18 magazines, 40 Luger 9mm rounds and approximately 400 rounds of .223 Red Army ammunition, which are made in Russia. None of the firearms or firearm parts had any identifying serial numbers or markings. They were all ghost guns. Wiretap intercepts showed that defendant Cory Gershen supplied other members of the organization with ghost guns in exchange for methamphetamine. The investigation also revealed the assault rifles (depicted below) were destined for the organization’s source of supply in Mexico.
Multiple AR-style firearms, parts, pistols, magazines, unfinished firearm parts used to create ghost guns, and a cache of Russian made ammunition.
On June 30, 2021, agents seized additional ghost guns, ammunition and methamphetamine from another member of the same drug trafficking organization. Specifically, agents seized two AR-style ghost guns and a Colt .380 semiautomatic handgun and additional Russian rifle ammunition from defendant Guadalupe Molina-Flores, one of the alleged members of the trafficking organization. According to a search warrant, after seizing the firearms, agents searched Molina-Flores’ residence and found 309.4 grams (0.68 pounds) of methamphetamine.
Two more AR-style rifles, a pistol, magazines, and Russian made ammunition. Notably, these were exchanged for drugs.
Fentanyl continues to be a prolific killer. Imperial County experienced 24 opioid-related overdose deaths in 2022, the most recent full year of data available from the California Department of Public Health. The annual mortality rate for 2022 was 13.57 deaths per 100,000 residents—an increase of 41 percent over 2021.
The investigation revealed that the price per fentanyl pill has plummeted. For example, in June 2021, targets of the investigation were obtaining fentanyl pills in Imperial Valley at approximately $1.65 to $1.75 per pill. By December 2021, the prices being discussed had dropped to approximately $1.25 per pill. By May 2024, the same pills were being sold at only 45 cents per pill—less than one-third of the price three years earlier. The precipitous drop in price reflects the increased supply and availability of fentanyl being smuggled into the United States and the close ties between targets of this investigation and their Sinaloa Cartel supplier of fentanyl pills.
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.
*An indictment, complaint or information in a search warrant 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.
DEFENDANT Case Number 24cr0455-CAB
Maria Isabel Ferrat 34 Brawley, CA
SUMMARY OF CHARGES
Possession with Intent to Distribute Methamphetamine (21 U.S.C. § 841(a)(1))
Maximum Penalties: Twenty years in prison and a $1 million fine.
DEFENDANTS Case Number 24cr0456-CAB
*Guadalupe Molina-Flores, AKA “Lupe” 43 Westmoreland, CA
Stephanie Joann Hernandez, AKA “JoJo” 42 El Centro, CA
*Emmanuel Becerra, AKA “E-Man” 36 Westmorland, CA
Jeremy Clayton Harris, Sr. 44 El Centro, CA
Jack Daniel Myers 41 Westmorland, CA
Cory Gershen 36 Jacumba, CA
SUMMARY OF CHARGES
Conspiracy to Distribute Methamphetamine, Fentanyl and Heroin (21 U.S.C. §§ 841, 846)
Possession with Intent to Distribute Methamphetamine (21 U.S.C. § 841(a)(1))
Felon in Possession of Ammunition (18 U.S.C. § 922(g)(1))
Using, Carrying or Possession of Firearm in Commission of a Drug Trafficking Crime
(18 U.S.C. 924(c)(1)(A)(i))Maximum Penalties: For conspiracy charge and possession with intent to distribute methamphetamine charges: Life in prison with a mandatory minimum of 10 years and a $10 million fine. For felon in possession of ammunition charge: Ten years in prison and a $250,000 fine. For using, carrying or possession of firearm in commission of a drug trafficking crime: Five years in prison mandatory consecutive to the related drug trafficking offense and $250,000 fine.
DEFENDANTS Case Number 24cr0504-CAB
Eduardo Mendoza, AKA “Casper” 31 Niland, CA
Francisco Javier Mendoza, AKA “Pancho” 33 Niland, CA
Carlos Cezar Mendoza 36 Yuma, AZ
Christopher John Coffman 59 Brawley, CA
Daniel Estevan Mendoza 30 Brawley, CA
Tyran Malik Sullivan 40 Brawley, CA
Katelyn Singh 32 Holtville, CA
Cynthia Diaz 35 Imperial, CA
Robert Leroy Humble 49 Brawley, CA
Terry Kyle Christiansen 52 Imperial, CA
Melvin Betha 25 Niland, CA
*Dylan Gutierrez 24 Calexico, CA
SUMMARY OF CHARGES
Conspiracy to Distribute Methamphetamine and Fentanyl (21 U.S.C. §§ 841, 846)
Maximum Penalties: Life in prison with a mandatory minimum of 10 years and a $10 million fine.
DEFENDANT Case Number 24cr0849-CAB
*Maricela Selk 47 Brawley, CA
SUMMARY OF CHARGES
Conspiracy to Distribute Methamphetamine (21 U.S.C. §§ 841, 846)
Maximum Penalties: Life in prison with a mandatory minimum of 10 years and a $10 million fine.
DEFENDANT Case Number 24cr0854-CAB
Christopher Landon Bustin 40 Chula Vista, CA
SUMMARY OF CHARGES
Possession with Intent to Distribute Methamphetamine (21 U.S.C. §§ 841, 846)
Felon in Possession of Firearm and Ammunition (18 U.S.C. § 922(g)(1))
Maximum Penalties: For possession with intent to distribute methamphetamine charges: Life in prison with a mandatory minimum of 10 years and a $10 million fine. For felon in possession charge: Ten years in prison and a $250,000 fine
DEFENDANT Case Number 24cr0855-CAB
Ernie David Davila 43 Holtville, CA
SUMMARY OF CHARGES
Possession with Intent to Distribute Methamphetamine (21 U.S.C. § 841(a)(1))
Maximum Penalties: Life in prison with a mandatory minimum of 10 years and a $10 million fine.
DEFENDANT Case Number 24cr0856-CAB
*Karla Franco 42 Los Angeles, CA
Frederick Joseph McKenna, AKA “Downer” 32 Pico Rivera, CA
Gabino Mora 31 Pico Rivera, CA
SUMMARY OF CHARGES
Conspiracy to Distribute Methamphetamine (21 U.S.C. §§ 841, 846)
Possession with Intent to Distribute Methamphetamine (21 U.S.C. § 841(a)(1))
Maximum Penalties: Life in prison with a mandatory minimum of 10 years and a $10 million fine.
DEFENDANT Case Number 24cr0857-CAB
Alexander Bennet Grindley 53 Brawley, CA
SUMMARY OF CHARGES
Possession with Intent to Distribute Methamphetamine (21 U.S.C. § 841(a)(1))
Maximum Penalties: Twenty years in prison and a $1 million fine.
DEFENDANT Case Number 24cr0858-CAB
Robert Thomas Isaac, AKA “RT” 48 Brawley, CA
SUMMARY OF CHARGES
Conspiracy to Distribute Methamphetamine, Heroin and Fentanyl (21 U.S.C. §§ 841, 846)
Maximum Penalties: Life in prison with a mandatory minimum of 10 years and a $10 million fine.
DEFENDANT Case Number 24cr0909-TWR
*Bryan Ayala Alvarez, AKA “Pingo” 41 Brawley, CA
SUMMARY OF CHARGES
Conspiracy to Distribute Methamphetamine (21 U.S.C. §§ 841, 846)
Possession with Intent to Distribute Methamphetamine (21 U.S.C. § 841(a)(1))
Maximum Penalties: Life in prison with a mandatory minimum of 10 years and a $10 million fine.
DEFENDANT Case Number 24cr0910-CAB
*Alfred Aldapa Juarez, Jr. 32 Brawley, CA
SUMMARY OF CHARGES
Possession with Intent to Distribute Methamphetamine (21 U.S.C. § 841(a)(1))
Maximum Penalties: Life in prison with a mandatory minimum of 10 years and a $10 million fine.
DEFENDANT Case Number 24cr0911-CAB
*Pedro Alberto Rioseco, AKA “Pete” 42 Calexico, CA
Jesus Antonio Escoto-Troncozo, AKA “Chocho” 45 El Centro, CA
SUMMARY OF CHARGES
Conspiracy to Distribute Methamphetamine (21 U.S.C. §§ 841, 846)
Possession with Intent to Distribute Methamphetamine (21 U.S.C. § 841(a)(1))
Felon in Possession of Firearm and Ammunition (18 U.S.C. § 922(g)(1))
Using, Carrying or Possession of Firearm in Commission of a Drug Trafficking Crime
(18 U.S.C. 924(c)(1)(A)(i))Maximum Penalties: For conspiracy charge and possession with intent to distribute methamphetamine charges: Life in prison with a mandatory minimum of 10 years and a $10 million fine. For felon in possession of ammunition charge: Ten years in prison and a $250,000 fine. For using, carrying or possession of firearm in commission of a drug trafficking crime: Five years in prison mandatory consecutive to the related drug trafficking offense and $250,000 fine.
DEFENDANTS Case Number 24cr00093-RSH
Sergio Reyes-Green 32 Brawley, CA
James Wade Hanks 53 Brawley, CA
Jesus Fernardo Romero, AKA “Chuy” 28 (In Custody)
Yomayra Patricia Penuelas 37 El Cajon, CA
SUMMARY OF CHARGES
Conspiracy to Import Methamphetamine (21 U.S.C. §§ 952, 960, 963)
Importation of Methamphetamine (21 U.S.C. §§ 952, 960)
Aiding and Abetting (18 U.S.C. § 2)
Conspiracy to Launder Money (21 U.S.C. § 1956(h), 1956(a)(2)(A) and (a)(2)(B))
Maximum Penalties: For methamphetamine charges: Life in prison with a mandatory minimum of 10 years and a $10 million fine. For the money laundering charges: Twenty years in prison and a fine of $500,000 or twice the amount of criminal derived property, whichever is greater.
DEFENDANTS Case Number 24cr00094-RSH
Mario Alberto Urena, AKA “Vaca” 34 Brawley, CA
Pablo Enrique Trejo, AKA “Bolas” 45 Calexico, CA*Carlos Felipe Ruedas-Celaya 45 Calexico, CA
Estevan Ramirez Gonzalez 26 Phoenix, AZ
*Francisco Javier Ramirez-Garcia, AKA “Pitufo” 56 Calexico, CA
*Javier Jacquez 48 Calexico, CA
Araceli Rangel-Torres 28 Mexicali, Mexico
Miguel Angel Flores 31 Fresno, CA
Carlos Valencia Mendoza 29 Mexicali, MexicoSUMMARY OF CHARGES
Conspiracy to Distribute Fentanyl (21 U.S.C. §§ 841, 846)
Conspiracy to Distribute Methamphetamine (21 U.S.C. §§ 841, 846)
Conspiracy to Possess with Intent to Distribute Methamphetamine (21 U.S.C. §§ 841, 846)Possession with Intent to Distribute Controlled Substances (21 U.S.C. § 841(a)(1))
Aiding and Abetting (18 U.S.C. § 2)
Conspiracy to Launder Money (21 U.S.C. § 1956(h), 1956(a)(2)(A) and (a)(2)(B))
Maximum Penalties:
For conspiracy charges: Life in prison with a mandatory minimum of 10 years and a $10 million fine.
For the possession with intent to distribute methamphetamine charges (except Count 3): Life in prison with a mandatary minimum of 10 years and a $10 million fine.
For the possession with intent to distribute methamphetamine charge in Count 3: Forty years in prison with a mandatory minimum of five years and a $5 million fine.
For the money laundering charges: Twenty years in prison and a fine of $500,000 or twice the amount of criminal derived property, whichever is greater.
*Fugitives
AGENCIES
Homeland Security Investigations
Drug Enforcement Administration
Department of Justice, Organized Crime Drug Enforcement Task Forces
Department of Justice Office of Enforcement Operations
United States Border Patrol
U.S. Customs and Border Protection - Office of Field Operations
U.S. Customs and Border Protection - Air and Marine Operations
ICE Enforcement and Removal Operations
Bureau of Alcohol, Tobacco Firearms and Explosives
United States Postal Inspection Service
DHS Office of Inspector General
California Department of Corrections and Rehabilitation
California Highway Patrol
Brawley Police Department
El Centro Police Department
Calexico Police Department
Imperial County Sheriff’s Office
Imperial County District Attorney’s Office
Imperial County Probation Department
Imperial Police Department
Westmorland Police Department
Calipatria Police Department
Imperial Valley - Law Enforcement Coordination Center
Imperial County Child Protective Service
San Diego County Sheriff’s Office
United States Marshals Service
Forty-Seven Defendants Charged in Imperial Valley Takedown of Drug Trafficking Network Linked to Sinaloa CartelRead the Press Release
Fourteen indictments were unsealed today charging 47 alleged members of an Imperial Valley, California-based, Sinaloa Cartel-linked fentanyl-and-methamphetamine distribution network with drug trafficking, firearms, and money laundering offenses.
In a coordinated takedown this morning, more than 400 federal, state, and local law enforcement officials arrested 36 defendants and executed 25 search warrants in Imperial County; San Diego; Fresno, California; Los Angeles; Phoenix; and Salem, Oregon. As of this afternoon, the search continues for 11 fugitives.
Including seizures today and throughout the long-term investigation, authorities have confiscated more than four kilograms of fentanyl, which amounts to about two million potentially fatal doses; more than 324 kilograms (over 714 pounds) of methamphetamine; significant quantities of cocaine and heroin; and 52 firearms, including handguns and rifles.
The investigation also resulted in the arrest of Alexander Grindley for alleged methamphetamine trafficking while employed as a U.S. Border Patrol agent and multiple spin-off investigations in this district and others.
Crimes charged in the indictments include drug trafficking, money laundering, and gun-related offenses. Court documents indicated the defendants were operating throughout the Imperial Valley — in Brawley, El Centro, Westmoreland, Imperial, Calexico, Niland, Holtville, Calipatria — and in Mexicali, Mexico.
“With this takedown, the Justice Department has dealt yet another blow to the Sinaloa Cartel and its associates,” said Attorney General Merrick B. Garland. “I am grateful to the more than 400 law enforcement officers whose work in this operation resulted in dozens of arrests, charges against 47 defendants, and the seizure of firearms, meth, cocaine, heroin, and two million potentially lethal doses of fentanyl. We will continue to be relentless in our fight to protect American communities from the cartels.”
“The Department of Homeland Security and our federal, state, and local partners are unrelenting in our work to keep deadly fentanyl off our streets and bring those who traffic in it to justice,” said Secretary of Homeland Security Alejandro N. Mayorkas. “The indictments unsealed today are the direct result of our multipronged and coordinated law enforcement approach — one that utilizes all of our government’s resources and capabilities. Together, we are preventing fentanyl and other deadly drugs from being produced, distributed, or consumed, and saving countless lives.”
“This investigation tore apart a drug trafficking network responsible for supplying dealers in communities across the region,” said U.S. Attorney Tara McGrath for the Southern District of California. “But there is still much work to be done. If you’re a parent and today’s price of fentanyl terrifies you, talk to your kids about the dangers of drug use. If you’re an addict and your dealer was arrested today, seek treatment. And if you’re a dealer but your supplier was arrested today, look out – we are coming for you next.”
“Today’s coordinated operation, involving, over 400 federal, state, and local law enforcement officials, marks a decisive blow against an Imperial Valley-based, Sinaloa Cartel-linked distribution network and significantly disrupts the flow of dangerous drugs into our communities,” said Acting Special Agent in Charge Chris Davis of Homeland Security Investigations, San Diego. “This operation is a testament to the power of law enforcement collaboration and our unwavering commitment to bringing these criminals to justice.”
“Today, the El Centro Border Patrol Sector teamed with allied law enforcement agencies to support both Homeland Security Investigations and the U.S. Attorney’s Office for the Southern District of California in this operation,” said Chief Gregory Bovino of the U.S. Border Patrol’s El Centro Sector. “Our successful collaboration should be a reminder to criminal organizations in the Imperial Valley and elsewhere that justice will be served.”
“This operation shows what can be accomplished when there is collaboration between federal and local law enforcement agencies,” said Imperial County District Attorney George Marquez. “The Imperial County District Attorney’s office will continue to work together with our partners to bring to justice those that harm or are a danger to our community.”
According to the indictments and search warrants, the defendants belonged to various trafficking organizations that were part of an extensive network supplying all of Imperial County and beyond with dangerous drugs.
According to court records, on June 30, 2021, agents seized two pounds of methamphetamine and a cache of ghost guns and ammunition, including: 15 lower receivers, three upper receivers, multiple barrels and stocks, 18 magazines, 40 Luger 9mm rounds, and approximately 400 rounds of .223 Red Army ammunition, which are made in Russia. None of the firearms or firearm parts had any identifying serial numbers or markings. They were all ghost guns. Wiretap intercepts showed that defendant Cory Gershen supplied other members of the organization with ghost guns in exchange for methamphetamine. The investigation also revealed the assault rifles (depicted below) were destined for the organization’s source of supply in Mexico.
On June 30, 2021, agents seized additional ghost guns, ammunition, and methamphetamine from another member of the same drug trafficking organization. Specifically, agents seized two AR-style ghost guns and a Colt .380 semiautomatic handgun, and additional Russian rifle ammunition from defendant Guadalupe Molina-Flores, one of the alleged members of the trafficking organization. According to a search warrant, after seizing the firearms, agents searched Molina-Flores’ residence and found 309.4 grams (0.68 pounds) of methamphetamine.
Fentanyl continues to be a prolific killer. Imperial County experienced 24 opioid-related overdose deaths in 2022, the most recent full year of data available from the California Department of Public Health. The annual mortality rate for 2022 was 13.57 deaths per 100,000 residents — an increase of 41% over 2021.
The investigation revealed that the price per fentanyl pill has plummeted. For example, in June 2021, targets of the investigation were obtaining fentanyl pills in Imperial Valley at approximately $1.65 to $1.75 per pill. By December 2021, the prices being discussed had dropped to approximately $1.25 per pill. By May, the same pills were being sold at only 45 cents per pill — less than one-third of the price three years earlier. The precipitous drop in price reflects the increased supply and availability of fentanyl being smuggled into the United States and the close ties between targets of this investigation and their Sinaloa Cartel supplier of fentanyl pills.
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.
An indictment, complaint, or information is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Fourteen People Charged in International Drug Trafficking and Money Laundering SchemeRead the Press Release
NEWS RELEASE SUMMARY – May 30, 2024
SAN DIEGO – A federal grand jury has charged 14 people with participating in an international multi-million-dollar cocaine trafficking and money laundering scheme.
According to an indictment unsealed today, plus additional information in a related search warrant, the alleged leader of the trafficking organization, Jesus Ruiz-Sandoval, managed the smuggling and distribution of large quantities of cocaine from Tijuana into the United States, and the movement of cash proceeds back to Mexico. Ruiz is a United States citizen who fled the U.S. for Mexico several years ago, in violation of his terms of supervised release for a prior federal drug-trafficking crime (Case number 08-cr-00713-DSF in the Central District of California).
The search warrant said Ruiz worked closely with other co-conspirators, including John Joe Soto and Esteban Sinhue Mercado, who are also U.S. citizens currently residing in Mexico. The alleged conspiracy involved smuggling large multi-kilo quantities of cocaine from Tijuana through San Diego to Los Angeles. From there, commercial trucks transported the cocaine from Los Angeles to the Mid-Atlantic for distribution in the Eastern United States. Commercial trucks also transported cash proceeds from the cocaine sales back across the United States to Los Angeles, where it was packaged and loaded into cars that couriers drove through San Diego and into Tijuana, delivering the proceeds to Ruiz there. To date, investigators have seized more than $5 million in cash proceeds and more than 130 kilos of cocaine.
“This office targets sophisticated international trafficking cells by hitting them where it hurts — their wallets,” said U.S. Attorney Tara K. McGrath. “Following the money takes you to the heart of a trafficking organization and this prosecution aims to drive a stake through it.” U.S. Attorney McGrath expressed her gratitude to the Los Angeles Police Department and the Hawthorne Police Department, which provided invaluable partnership in this investigation.
“One of the pillars of Homeland Security Investigations (HSI) is to identify and dismantle international drug trafficking organizations who poison our communities,” said Christopher Davis, Acting Special Agent in Charge for HSI San Diego. “Throughout this investigation and with the unwavering support from our law enforcement partners, we further discovered their involvement in a money laundering scheme. This indictment serves as a warning to those believing they can remain undetected by HSI – our message is clear. You will be found and you will be brought to justice.”
“This indictment marks a significant milestone in our relentless pursuit of justice against transnational criminal organizations. By leveraging collaborative efforts, CBP alongside our partner agencies are able to target the root causes of crime and dismantle organized criminal enterprises,” said Sidney K. Aki, Director of Field Operations for San Diego Field Office. “Ultimately, this unified approach promotes public safety, reduces the flow of illegal drugs and laundered funds, and strengthens the resilience of communities against these threats.”
This investigation is one of two into Ruiz. Several months after a grand jury in San Diego first indicted Ruiz, a separate grand jury in the Central District of California indicted him and others for a separate, but similar, international trafficking scheme. See United States v. Sandoval et al., 24-CR-008 AB (C.D. Cal.). The prosecutions of Ruiz and others indicted in both cases will proceed in coordinated fashion.
Another defendant, Ricardo Miranda-Beltran (aka Ricardo Miranda-Benitez), appeared Tuesday for his initial appearance on the indictment. Miranda was arrested in the Eastern District of California and ordered detained, and then ordered to appear in San Diego on these charges.
DEFENDANTS Case Number 23cr1574 AJB
*Jose Ruiz-Sandoval Age: 45 Mexico
*John Joe Soto Age: 43 Mexico
*Esteban Sinhue Mercado Age: 24 Mexico
Brittany Mangrum Age: 36 Van Nuys, CA
Liliana Ruvalcaba-Gonzalez Age: 25 Anaheim, CA
Yessenia Lazo Age: 23 Los Angeles, CA
Ricardo Miranda-Beltran Age: 57 Bakersfield, CA
Edwin Rafael Hernandez Age: 32 Pasadena, CA
*Denotes fugitives who are not in custody
**Additional defendants’ names are redacted and not listed here
SUMMARY OF CHARGES
Conspiracy to Distribute Controlled Substances – Title 21, United States Code, Sections 841(a) & 846
Maximum Penalty: Life in custody, $10 million fine, and a life term of supervised release
Conspiracy to Import Controlled Substances – Title 21, United States Code, Sections 952, 960, and 963
Maximum Penalty: Life in custody, $10 million fine, and a life term of supervised release
Consp. to Launder Monetary Instruments – Title 18, United States Code, Sections 1956(a)(2)(B)(i) & (h)
Maximum Penalty:- Twenty years in custody, $500,000 fine or twice the laundered amount, and a 3-year term of supervised release
Bulk Cash Smuggling – Title 31, United States Code, Section 5332
Maximum Penalty: Five years in custody, $250,000 fine, and a 3-year term of supervised release
AGENCIES
Homeland Security Investigations
Customs and Border Protection
Los Angeles Police Department, Transnational Organized Crime Section
Hawthorne Police Department
*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
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.
Former U.S. Border Patrol Agent Sentenced to 87 Months in Prison for Attempting to Distribute Methamphetamine and Receiving BribesRead the Press Release
SAN DIEGO – Former U.S. Border Patrol Agent Hector Hernandez, who admitted that he took bribes to smuggle methamphetamine and people across the U.S.-Mexico border while on duty, was sentenced in federal court today to 87-months in prison.
Hernandez pleaded guilty in January, admitting that he agreed to use his official position to open border fences and allow unauthorized immigrants to enter the United States from Mexico. Hernandez also agreed to move methamphetamine and other controlled substances from the Southern District of California further north to other locations within the United States.
In his plea agreement, Hernandez acknowledged he took Mexico-based smugglers on a tour of the U.S.-Mexico border, showing them the best locations to sneak unauthorized immigrants into the U.S. He also provided information about the location of monitoring devices and cameras – information only known to him by virtue of his position as a Border Patrol agent. Hernandez admitted that he opened restricted border fences on several occasions to allow people to illegally enter the United States in exchange for cash payments of $5,000 per opening.
“In every instance, the U.S. Attorney’s Office stands ready to reinforce public trust in law enforcement,” said U.S. Attorney Tara McGrath. “When that trust is undermined by criminal acts concealed behind a badge, it threatens both public safety and the integrity of our judicial system. Hernandez put personal greed above the safety of others and this sentence reflects the magnitude of his actions.”
“Agent Hernandez disgraced his badge when he chose to smuggle both drugs and people across the border,” said DEA Acting Special Agent in Charge Anthony Chrysanthis. “His sentence reflects the harm he caused his coworkers and his country. As law enforcement we are held to a higher standard, and we must be held accountable for our actions.”
“Today’s sentencing sends a clear message that federal officials who betray the people they are sworn to protect will be held accountable for their actions,” said DHS Inspector General Joseph V. Cuffari.
According to court records, Hernandez admitted that on May 9, 2023, he met with someone who unbeknownst to him was, in fact, an undercover federal agent, and agreed to pick up a bag full of narcotics that would be hidden near the border fence. Hernandez agreed to pick up the bag while on duty and deliver it to the undercover agent in exchange for $20,000. Once the agreement was made, agents loaded the bag with 10 kilograms of fake methamphetamine, one pound of real methamphetamine, and a tracking device, before placing the bag in a storm drain near the border fence.
Later that evening, Hernandez drove his official vehicle to the storm drain while on duty and retrieved the bag. He drove the bag to his residence in Chula Vista and left the bag there for the remainder of his work shift. On May 10, 2023, after his shift was over, Hernandez returned home, retrieved the bag, and drove to meet with the undercover agent. Upon arrest, agents confirmed that that the bag still contained both the sham and real methamphetamine.
After Hernandez was arrested, agents searched his residence and found $131,717 in cash and 7.7 grams of cocaine. Hernandez admitted at least $110,000 of the cash represented proceeds he received in connection with his narcotics trafficking and bribery activities.
As part of his plea agreement, Hernandez forfeited his personal vehicle used to bring the drugs to the undercover agent; $110,000 of the seized cash; and his interest in his residence where the drugs were maintained.
In court today, U.S. District Judge Janis L. Sammartino said, “Border Patrol is an honorable and admirable agency of the Government sworn to protect and safeguard our borders… [Hernandez] chose to betray the agency, the nation and betray public trust.”
This case is being prosecuted by Assistant U.S. Attorneys Sean Van Demark and Lawrence A. Casper.DEFENDANT Case Number 23cr1114-JLS
Hector Hernandez Age: 55 Chula Vista, CASUMMARY OF CHARGES
Attempted Distribution of Methamphetamine – 21 U.S.C., Sections 841(a)(1) and 846
Maximum penalty: Life imprisonment in prison with a 10-year mandatory minimumReceiving Bribe by Public Official – 18 U.S.C., Section 201(b)(2)
Maximum penalty: Fifteen years in prisonINVESTIGATING AGENCIES
Department of Homeland Security, Office of Inspector General
Drug Enforcement Administration
Federal Bureau of InvestigationMan Charged in Scams Targeting SeniorsRead the Press Release
NEWS RELEASE SUMMARY – May 22, 2024
SAN DIEGO – Jiaci Liu appeared in federal court today following his arrest for engaging in a multinational fraud conspiracy targeting seniors, including a 63-year-old man from Poway.
According to a federal complaint, the San Diego Elder Justice Task Force (ETJF) learned of the fraud scheme after the victim reported to the San Diego Sheriff’s Department that he been duped as part of a layered tech support, bank impersonation and government impersonation scam.
Specifically, while on his personal computer, a pop-up window appeared indicating there was a possible virus on his computer and instructing him to contact a phone number. When he contacted the number, he was transferred through a series of co-conspirators pretending to work in tech support. The victim was informed that his computer had viruses. The victim was then transferred to another conspirator who claimed to be from the victim’s bank. During that interaction, the victim was told there were unauthorized transfers from his bank. The victim was instructed to go immediately to his bank and to withdraw all his money for safekeeping.
At the direction of the conspirators, the victim went to his bank and withdrew $28,000. The victim was then instructed by the conspirators that someone from the U.S. Marshals Service would come to his house to pick up the money. After the interaction, the victim became suspicious and contacted the San Diego Sheriff’s Department, which informed the victim to contact them if anyone showed up to pick up the money.
According to the complaint, on June 9, 2023, defendant Jiaci Liu arrived at the victim’s residence. The victim called the police, who arrived and found Liu outside the victim’s home. Liu’s cellphone was seized and later searched. Investigators located evidence indicating that in just one week in June 2023, Liu had picked up over $348,000 dollars from multiple victims located in Southern California and Phoenix, Arizona.
“Everyone with a computer is vulnerable to sophisticated scams like the one alleged in this case,” said U.S. Attorney Tara McGrath. “If you think you’ve been targeted, report it quickly. The faster the report comes in, the more likely we are to catch the scammers and recover any swindled money.”
“Individuals committing tech scams are getting more and more innovative with the methods they use to con innocent people,” said FBI San Diego Acting Special Agent in Charge Houtan Moshrefi. “The FBI and its law enforcement partners continually adapt our strategies so that we can stay ahead of those who scheme and collude to defraud the American public. We are committed to ensuring each of these individuals is brought to justice.”
A detention hearing is scheduled for May 24, 2024 at 9:30 a.m. before U.S. Magistrate Judge David D. Leshner.
This case was investigated by the San Diego Elder Justice Task Force and its member agencies, including the U.S. Attorney’s Office, Federal Bureau of Investigation, San Diego County District Attorney’s Office, Carlsbad Police Department, San Diego Police Department, and the California Highway Patrol.
If you or someone you know is age 60 or older and has been a victim of financial fraud, help is available through the National Elder Fraud Hotline: 1-833 FRAUD-11 (1-833-372-8311). You can also report fraud to any local law enforcement agency or on the FBI’s Internet Crime Complaint Center at www.ic3.gov.
This case is being prosecuted by Assistant U.S. Attorney Kevin Mokhtari.
DEFENDANT Case Number 24MJ1929-MSB
Jiaci Liu Age: 34 Monterey Park, California
SUMMARY OF CHARGES
Conspiracy to Commit Wire Fraud – Title 18, U.S.C., Section 1349
Criminal Forfeiture – Title 18, U.S.C., Sections 981(a)(1)(C), 982(a)(2)(A), and Title 28, U.S.C., Section 2461(c)
Maximum Penalties: Thirty years in prison; $1 million fine
INVESTIGATING AGENCIES
Federal Bureau of Investigation
San Diego County District Attorney’s Office
San Diego County Sheriff’s DepartmentSan Diego Police Department
San Diego Elder Justice Task Force
*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
Man Charged in Scams Targeting SeniorsRead the Press Release
NEWS RELEASE SUMMARY – May 22, 2024
SAN DIEGO – Jiaci Liu appeared in federal court today following his arrest for engaging in a multinational fraud conspiracy targeting seniors, including a 63-year-old man from Poway.
According to a federal complaint, the San Diego Elder Justice Task Force (ETJF) learned of the fraud scheme after the victim reported to the San Diego Sheriff’s Department that he been duped as part of a layered tech support, bank impersonation and government impersonation scam.
Specifically, while on his personal computer, a pop-up window appeared indicating there was a possible virus on his computer and instructing him to contact a phone number. When he contacted the number, he was transferred through a series of co-conspirators pretending to work in tech support. The victim was informed that his computer had viruses. The victim was then transferred to another conspirator who claimed to be from the victim’s bank. During that interaction, the victim was told there were unauthorized transfers from his bank. The victim was instructed to go immediately to his bank and to withdraw all his money for safekeeping.
At the direction of the conspirators, the victim went to his bank and withdrew $28,000. The victim was then instructed by the conspirators that someone from the U.S. Marshals Service would come to his house to pick up the money. After the interaction, the victim became suspicious and contacted the San Diego Sheriff’s Department, which informed the victim to contact them if anyone showed up to pick up the money.
According to the complaint, on June 9, 2023, defendant Jiaci Liu arrived at the victim’s residence. The victim called the police, who arrived and found Liu outside the victim’s home. Liu’s cellphone was seized and later searched. Investigators located evidence indicating that in just one week in June 2023, Liu had picked up over $348,000 dollars from multiple victims located in Southern California and Phoenix, Arizona.
“Everyone with a computer is vulnerable to sophisticated scams like the one alleged in this case,” said U.S. Attorney Tara McGrath. “If you think you’ve been targeted, report it quickly. The faster the report comes in, the more likely we are to catch the scammers and recover any swindled money.”
“Individuals committing tech scams are getting more and more innovative with the methods they use to con innocent people,” said FBI San Diego Acting Special Agent in Charge Houtan Moshrefi. “The FBI and its law enforcement partners continually adapt our strategies so that we can stay ahead of those who scheme and collude to defraud the American public. We are committed to ensuring each of these individuals is brought to justice.”
A detention hearing is scheduled for May 24, 2024 at 9:30 a.m. before U.S. Magistrate Judge David D. Leshner.
This case was investigated by the San Diego Elder Justice Task Force and its member agencies, including the U.S. Attorney’s Office, Federal Bureau of Investigation, San Diego County District Attorney’s Office, Carlsbad Police Department, San Diego Police Department, and the California Highway Patrol.
If you or someone you know is age 60 or older and has been a victim of financial fraud, help is available through the National Elder Fraud Hotline: 1-833 FRAUD-11 (1-833-372-8311). You can also report fraud to any local law enforcement agency or on the FBI’s Internet Crime Complaint Center at www.ic3.gov.
This case is being prosecuted by Assistant U.S. Attorney Kevin Mokhtari.
DEFENDANT Case Number 24MJ1929-MSB
Jiaci Liu Age: 34 Monterey Park, California
SUMMARY OF CHARGES
Conspiracy to Commit Wire Fraud – Title 18, U.S.C., Section 1349
Criminal Forfeiture – Title 18, U.S.C., Sections 981(a)(1)(C), 982(a)(2)(A), and Title 28, U.S.C., Section 2461(c)
Maximum Penalties: Thirty years in prison; $1 million fine
INVESTIGATING AGENCIES
Federal Bureau of Investigation
San Diego County District Attorney’s Office
San Diego County Sheriff’s DepartmentSan Diego Police Department
San Diego Elder Justice Task Force
*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
Defendants Charged with Distributing Fentanyl that Resulted in Overdose Death of Carlsbad WomanRead the Press Release
NEWS RELEASE SUMMARY – May 22, 2024
SAN DIEGO – A federal grand jury returned an indictment today charging Bryan Kim Bullard and Cameron William Fulston with distributing the fentanyl that resulted in the death of a 25-year-old Carlsbad woman.
According to court records, on September 10, 2023, at approximately 12:23 a.m., San Diego Police Department officers were dispatched for a suspected drug overdose to an apartment complex in Mission Valley. One minute prior, a 911 call had been placed from the victim’s phone, in which a male individual reported “overdose, overdose” before ending the call while the dispatcher was trying to explain life saving measures.
Upon arrival, officers located the victim, identified in court records as D.G., lying unconscious on the bathroom floor. A San Diego Police officer pulled D.G. from the bathroom, determined she was not breathing, and began CPR until medical personnel arrived. D.G. was transported to a local hospital where she died five days later, on September 15th.
Within the bathroom where the overdose took place, officers observed a piece of foil with a brown liquid and a chunk of a white substance. Officers also located blue pills on the kitchen counter with “M30” stamped on them. The foil and pills both tested positive for the presence of fentanyl. Federal agents followed the evidence related to the sale of the fatal dose of fentanyl to the defendants.
“Behind every fatal overdose is a dealer who put someone’s life at risk,” said U.S. Attorney Tara McGrath. “We are holding them accountable to stop the cycle of devastation they perpetuate.”
“DEA in San Diego has made investigating overdose deaths a priority,” said DEA Acting Special Agent in Charge Anthony Chrysanthis. “We are committed to bringing drug dealers who poison our communities to justice.”
This case is being prosecuted by Assistant U.S. Attorneys Jill S. Streja and Adam Gordon.
Special Agents and Task Force Officers with the Drug Enforcement Administration’s Overdose Response Team (formerly known as Team 10) led the investigation. This case is the result of ongoing efforts by the U.S. Attorney’s Office, the San Diego County District Attorney’s Office, the Drug Enforcement Administration, Homeland Security Investigations, the San Diego Police Department, the La Mesa Police Department, National Guard Counterdrug Task Force 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 the Overdose Response Team as a response to the increase in overdose deaths in San Diego County.
DEFENDANTS Case Number 24-cr-00201-BAS
Bryan Kim Bullard Age: 43 San Diego, CA
Cameron William Fulston Age: 29 Carlsbad, CA
SUMMARY OF CHARGES
Conspiracy to Distribute Fentanyl Resulting in Death
U.S.C. §§ 841(a)(1) and (b)(1)(C), 846
Maximum penalty: Life in prison
Mandatory minimum: Twenty years in prison
Distribution of Fentanyl Resulting in Death
21 U.S.C. §§ 841(a)(1) and (b)(1)(C)
Maximum penalty: Life in prison
Mandatory minimum: Twenty years in prison
Distribution of Fentanyl
21 U.S.C. § 841(a)(1)
Maximum penalty: Twenty years in prison
Possession With Intent to Distribute Fentanyl
21 U.S.C. § 841(a)(1)
Maximum penalty: Forty years in prison
Mandatory minimum: Five years in prison
Possession With Intent to Distribute Methamphetamine
21 U.S.C. § 841(a)(1)
Maximum penalty: Forty years in prison
Mandatory minimum: Five years in prison
INVESTIGATING AGENCIES
Drug Enforcement Administration
San Diego County District Attorney’s Office
Homeland Security Investigations
San Diego Police Department
La Mesa 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.
Arizona Man Sentenced for Role in Scheme to Steal Money from U.S. Bank AccountsRead the Press Release
An Arizona man was sentenced yesterday in federal court in San Diego to 51 months in prison for conspiracy to commit access device fraud.
According to court documents, Luis Ramirez, 43, of Mesa, Arizona, helped to obtain “leads” for fraudsters who sought to steal money from the bank accounts of unknowing U.S. victims. The “leads” consisted of financial information for the prospective victims that included bank account numbers. Ramirez and his coconspirators trafficked “leads” that originated from payday loan applications of consumers across the United States. Ramirez was also sentenced yesterday to 120 months in prison on a separate case brought by the U.S. Attorney’s Office for the Southern District of California. In sentencing Ramirez, Judge Cynthia Bashant of the U.S. District Court for the Southern District of California determined that 24 months of his sentence should run consecutively, so that Ramirez’s total sentence is 144 months in prison.
“Those who knowingly supply fraudsters with personal and financial information about potential victims cause enormous harm to the American public,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “We are committed to investigating and prosecuting individuals who sell such information for illicit purposes.”
“The Postal Inspection Service is dedicated to protecting American consumers,” said Inspector in Charge Eric Shen of the U.S. Postal Inspection Service’s (USPIS) Criminal Investigations Group. “In this case, small transactions were used to conceal the scheme, but that wasn’t enough to fool postal inspectors or keep us from adding it all together to put a halt to this fraud.”
Related cases against other scheme participants have previously been filed in Los Angeles and in Las Vegas. In May 2023, a grand jury in Los Angeles returned an indictment charging 14 defendants with RICO conspiracy and other charges in the U.S. District Court for the Central District of California. The indictment alleges that the defendants and associates debited consumers’ bank accounts without authorization and used shell entities and “micro debits” to conceal the activity from banks. “Micro debits” serve to conceal fraud by grouping unauthorized charges with a large number of low-value, straw transactions to lower the fraudster’s chargeback rate. Another scheme participant, Harold Sobel, pleaded guilty to bank fraud conspiracy in federal court in Las Vegas. In December 2022, Sobel was sentenced to 42 months in prison.
USPIS investigated the case.
Trial Attorneys Wei Xiang, Meredith Healy and Amy Kaplan of the Justice Department’s Consumer Protection Branch prosecuted the case, with assistance from the U.S. Attorneys’ Offices for the Central and Southern Districts of California.
For more information about the Consumer Protection Branch and its enforcement efforts, visit www.justice.gov/civil/consumer-protection-branch.
Leader of Sophisticated Sinaloa Cartel Money Laundering Organization Sentenced to 120 MonthsRead the Press Release
NEWS RELEASE SUMMARY – May 20, 2024
SAN DIEGO – Luis Reinaldo Ramirez of Mesa, Arizona, was sentenced in federal court today to 120 months in prison for his role as a leader in a transnational criminal organization that laundered $16.5 million dollars in narcotics proceeds for the Sinaloa Cartel. Ramirez was also sentenced for his role in an extortion plot.
Ramirez was one of 12 people indicted on charges ranging from money laundering, narcotics trafficking, and extortion as part of a two-year investigation by FBI and DEA. The investigation resulted in the takedown of the organization that laundered millions of dollars for the Sinaloa Cartel, and the rescue of two victims of an extortion plot in February of 2021. To date the investigation has resulted in the seizure of more than $1.3 million in illicit assets.
According to his plea agreement, Ramirez played a key role in the day-to-day operations of the organization. He created a network of incorporated shell companies in Wyoming that were used to launder illicit bulk cash. Ramirez directed and facilitated employees of the money laundering organization to travel to cities throughout the United States to pick up bulk cash belonging to narcotics traffickers. The employees picked up the bulk cash in Chicago, Omaha, Boston, New York City, Baltimore, Charlotte, and Philadelphia.
Narcotics traffickers delivered bulk cash in amounts of up to $200,000 to the employees in hotel rooms and parking lots. Following the delivery of the illegal monies, the criminal organization laundered the funds through the shell companies and transferred the monies to bank accounts in Mexico. To demonstrate the drug money connection, in November 2020 the FBI conducted surveillance on a bulk cash delivery from Idsel Valenzuela and Sugey Caro Salazar in Chicago. The operation led to a subsequent search of Caro and Valenzuela’s home and vehicle, which led to the discovery and seizure of 368 pounds of crystal methamphetamine, 10 kilograms of heroin, and $97,390 in bulk cash.
Earlier this year, several of Ramirez’s co-defendants were sentenced to prison, including Cristian Amaya Nava, 60 months; Christian Cruz Polanco, 30 months; Sugey Caro Salazar, 48 months; and Idsel Valenzuela, Cheliann Rivera Vazquez and Kimberly Reyes to probationary sentences. Additional co-defendants — Hector Vizcaino Moreno, Ricardo Torres, and Luis Armando Avila — are scheduled to be sentenced in the coming months. Three of Ramirez’s indicted co-defendants remain fugitives in Mexico, including the alleged former Mexico-based leader of the organization, Enrique Esparragoza Rosas of Culiacan, Sinaloa, Mexico.
The FBI’s investigation, in partnership with the United States Attorney’s Office, pursued an aggressive strategy of asset seizures in order to disrupt the money laundering organization’s activities. In total, dozens of bank accounts used by the organization were targeted, resulting in the seizure of more than $1 million from U.S.-based bank accounts. Agents also conducted operations that resulted in the seizure of $197,430 in bulk cash and a Volvo tractor-trailer that was purchased with drug money. Agents also seized illicit funds that were used to purchase aircraft and aircraft engines for export to Mexico in several instances.
The FBI’s efforts also resulted in a successful rescue of two victims who were being extorted by the money laundering organization in February 2021. Prior to the extortion, one of the victims, an employee of the money laundering organization, began stealing illicit funds from a bank account he controlled for the organization. In February 2021, when Esparragoza and Ramirez learned of the theft, they conspired to threaten and extort the pair to repay the funds. Esparragoza sent Cristian Amaya-Nava to threaten the men and their families. Amaya-Nava then drove the two men around Imperial and San Diego counties to collect money from accounts they controlled. Esparragoza also directly threatened the men and their families during several phone conversations that day, telling them that two truckloads of men from Tijuana would “take care of them” if they did anything stupid.
Once the FBI learned of the ongoing extortion, they began tracking the victim’s and Amaya Nava’s movements. FBI agents coordinated with the National City Police Department to conduct a traffic stop wherein Amaya Nava was arrested and the two victims were rescued.
“In cases like this we strike at the life blood of the drug trafficker,” said U.S. Attorney Tara McGrath. “Money launderers provide the means for cartels to produce and import their deadly poison into the United States.”
“The sentencing of Mr. Ramirez is a major step toward dismantling the Sinaloa Cartel,” said FBI San Diego Special Agent in Charge, Stacey Moy. “We remain committed to working collaboratively with our law enforcement partners to disrupt and dismantle organized crime activity not only in San Diego, but wherever our investigations may lead.”
“There is no place for drug trafficking in San Diego,” said DEA Acting Special Agent in Charge Anthony Chrysanthis. “Drug trafficking is a violent crime that harms our citizens and weakens our communities. The DEA and our partners will continue to be vigilant in dismantling these operations.”
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 is being prosecuted by Assistant U.S. Attorney Joshua Mellor.
DEFENDANTS Case Number 22cr2185-BAS
Luis Reinaldo Ramirez Age: 41 Mesa, Arizona
SUMMARY OF CHARGES
Money Laundering Conspiracy – Title 18, U.S.C., Section 1956(h)
Maximum penalty: Twenty years in prison and $500,000 fine
Hobbs Act Extortion - Title 18, U.S.C., Section 1951(a)
Maximum penalty: Twenty years in prison and $250,000 fine
INVESTIGATING AGENCIES
Federal Bureau of Investigation
Drug Enforcement Administration
Organized Crime Drug Enforcement Task Forces
*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
Former San Diego Sheriff’s Deputy Charged with Civil Rights Violation for Fatally Shooting Unarmed ManRead the Press Release
A federal grand jury in San Diego returned a two-count indictment charging former San Diego Sheriff’s Deputy Aaron Russell for fatally shooting Nicholas Bils on May 1, 2020. Russell is charged with depriving Bils of his right to be free from officers using excessive force and with discharging a firearm in relation to a crime of violence.
The indictment alleges that Russell, while acting as a San Diego Sheriff’s Deputy, shot Bils after Bils had escaped from a California Parks vehicle and was running away from law enforcement officers who were chasing him. Without warning Bils or his fellow officers, Russell fired five shots at Bils, who was unarmed, as he ran away. One or more of the shots hit Bils in the back and caused his death. None of the other officers on scene fired a shot or drew a weapon.
If convicted, Russell faces a maximum penalty of life in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division, U.S. Attorney Tara McGrath for the Southern District of California and Special Agent in Charge Stacey Moy of the FBI San Diego Field Office made the announcement.
Assistant U.S. Attorney C. Seth Askins for the Southern District of California, Special Litigation Counsel Michael J. Songer and Trial Attorney Lia Rettammel of the Civil Rights Division’s Criminal Section are prosecuting the case.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Drug Trafficker Who Used College-Age Drivers to Import Methamphetamine Sentenced to 12 YearsRead the Press Release
NEWS RELEASE SUMMARY – May 17, 2024
SAN DIEGO – Fernando Castro Bazan, a Los Angeles-based drug trafficker, was sentenced in federal court today to 12 years in prison for his leadership role in a drug trafficking organization that employed drivers as young as 18 years old to import large quantities of methamphetamine into the United States from Mexico in the gas tanks of rental cars.
Castro Bazan, also known as “Benji” or “Benji Banks,” started using drivers to transport drugs for a Tijuana-based drug trafficking organization in the spring of 2021. Using his status as a club promoter and amateur musician, Castro Bazan hired numerous college-aged drivers, luring them with the prospect of easy money and “all-expenses-paid trips to Mexico.”
A number of the young drivers Castro Bazan employed were arrested at the border and convicted of drug trafficking or related offenses. They now have federal felony convictions on their records.
At today’s hearing, U.S. District Judge Jinsook Ohta noted that Castro Bazan had a “catastrophic and terrible impact on the lives of young people—teenagers—who had the misfortune to come across his path.”
“Not only did this defendant import staggering amounts of a deadly drug into our community, he took advantage of vulnerable young people who failed to appreciate the tremendous risk involved,” said U.S. Attorney Tara McGrath. “He turned college-age kids into traffickers and will serve a significant sentence for it.”
Castro Bazan is also facing drug charges in the Eastern District of California for his role in a distribution conspiracy that used couriers to deliver narcotics direct to buyers in Northern California.
This case is being prosecuted by Assistant U.S. Attorneys Robert J. Miller and Shivanjali A. Sewak.
DEFENDANT Case Number 22cr971-001-JO
Fernando Castro Bazan Age: 32 Los Angeles, CA
SUMMARY OF CHARGES
Conspiracy to Import Methamphetamine – Title 21, U.S.C., Sections 952, 960 and 963
Maximum penalty: Life in prison and $10 million fine
Minimum penalty: Ten years in prison
Importation of Methamphetamine – Title 21, U.S.C., Sections 952 and 960
Maximum penalty: Life in prison and $10 million fine
Minimum penalty: Ten years in prison
INVESTIGATING AGENCY
Homeland Security Investigations
Defendant Charged with Distributing Fentanyl and Methamphetamine that Resulted in Overdose Death of San Diego ResidentRead the Press Release
NEWS RELEASE SUMMARY – May 17, 2024
SAN DIEGO – James Jason Hendershaw of San Diego was charged in an indictment unsealed this week with distributing the fentanyl and methamphetamine that resulted in the death of a 20-year-old San Diego resident.
The Oceanside Police Department and Oceanside Fire Department responded to a 911 call a few minutes after 6 a.m. on January 10, 2019. When they arrived, they found the victim, identified in court records as R.J., unresponsive and lying on a sidewalk at the corner of Farel Street and Via Sonora in Oceanside. He was pronounced dead a few hours later.
Hendershaw allegedly distributed the fatal mix of fentanyl and methamphetamine the night before.
“Prosecuting drug dealers who supply deadly fentanyl and methamphetamine is not just about accountability; it’s about preventing death by interrupting the supply chain,” said U.S. Attorney Tara McGrath. “By identifying and charging the distributors, we send a clear message to the dealers of these toxins: You will be held accountable for the lives your product destroys.”
This case is being prosecuted by Assistant U.S. Attorneys Ryan Sausedo and Adam Gordon.
DEFENDANT Case Number 23-CR-2645-RBM
James Jason Hendershaw Age: 36 Vista, CA
SUMMARY OF CHARGES
Distribution of Fentanyl and Methamphetamine Resulting in Death – Title 18, United States Code, Sections 841(a)(1), (b)(1)(C)
Maximum penalty: Life in prison
Mandatory minimum: Twenty years in prison
INVESTIGATING AGENCIES
Oceanside Police Department
State of 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.
San Diego Pharmacy Pays $350,000 for Mishandling Controlled SubstancesRead the Press Release
NEWS RELEASE SUMMARY – May 2, 2024
SAN DIEGO – Palm Care Pharmacy, a San Diego County pharmacy chain with a storefront in El Cajon, has paid $350,000 to resolve allegations that it diverted controlled substances, failed to keep necessary accounting records for controlled substances, and improperly sold pseudoephedrine chemical products.
The settlement arises from a U.S. Drug Enforcement Administration investigation into suspected illegal activity at Talimi International, Inc. d/b/a Palm Care Pharmacy. Based on an inventory audit conducted by the DEA and other investigative activities, the government concluded that Palm Care Pharmacy’s El Cajon location committed multiple violations of the Controlled Substances Act and the Combat Methamphetamine Epidemic Act from 2018 through 2022.
The government alleged that Palm Care Pharmacy failed to control its inventory of controlled substances, failed to maintain a complete record of controlled substances and the transactions, and sold listed chemical products (e.g., pseudoephedrine) without the necessary training and certification. Palm Care Pharmacy’s failure to control inventory resulted in unaccounted-for pills, including: opioids (oxycodone, hydrocodone, and tramadol), benzodiazepines (Xanax), and muscle relaxants (Soma). In addition to paying $350,000 to resolve the government’s claims, Palm Care Pharmacy entered into a Memorandum of Agreement with the DEA requiring Palm Care Pharmacy to undertake additional measures to handle controlled substances properly and safely.
“Failure to manage inventory of controlled substances is not just a compliance issue, it’s a public safety issue,” said U.S. Attorney Tara McGrath. “Every untracked pill is a problem waiting to happen.”
“Accurate record keeping prevents controlled substances from ending up in the wrong hands,” said DEA Diversion Program Manager Rostant Farfan. “DEA will continue to hold registrants accountable to ensure they are operating within the closed system of distribution.”
This settlement was the result of a coordinated effort by the U.S. Attorney’s Office for the Southern District of California and the Drug Enforcement Administration.
To report a tip directly to a DEA representative regarding medical personnel writing suspicious opioid prescriptions and pharmacies dispensing large amounts of opioids, call (571) 324-6499 or visit the DEA’s website (https://www.deadiversion.usdoj.gov/) and click on “Report Illicit Pharmaceutical Activities.”
This case was prosecuted by Assistant U.S. Attorney Dylan M. Aste.
The claims resolved by the settlement are allegations only, and there has been no determination of liability.
Former Executive Pleads Guilty to Stealing More Than $400,000 from San Diego Non-ProfitRead the Press Release
NEWS RELEASE SUMMARY – April 25, 2024
SAN DIEGO – Katherine Lu Acquista, former Director of Operations and Accounting for the San Diego Regional Economic Development Corporation, pleaded guilty in federal court today, admitting that she stole more than $400,000 from the non-profit for her personal benefit.
The Economic Development Corporation, known as EDC, works to maximize San Diego’s economic prosperity and global competitiveness. As Director of Operations and Accounting, Acquista had access to the EDC’s bank accounts, credit cards, checkbook and payroll system. According to her plea agreement, Acquista put personal expenditures on EDC’s credit card and directed the accounting department to issue checks from EDC to herself.
To conceal her scheme, Acquista caused false entries to be made in the non-profit’s accounting system to account for the missing funds. For example, Acquista put personal charges on the EDC credit card, and then caused the expenditures in the EDC’s accounting system to be entered as charges for maintenance and repairs or for office supplies. Similarly, Acquista directed that checks be written to herself from the EDC bank account but then caused the checks to be entered into EDC’s accounting system as charges for recurring IT expenses. Acquista admitted in her plea agreement that as a result of her scheme the EDC lost $433,275.89.
“This defendant took funds that were supposed to make San Diego a stronger business community and spent them on herself,” said U.S. Attorney Tara McGrath. “Our office takes embezzlement from local businesses very seriously and will continue to vigorously prosecute these cases.”
“Ms. Acquista worked for an organization whose goal is to help the San Diego community; however, she chose to abuse her position of trust within the organization,” said FBI San Diego Acting Special Agent in Charge John Kim. “The FBI remains committed to ensuring that individuals who deliberately compromise the integrity of their position and organization for personal gain will be brought to justice.”
Acquista is scheduled to appear before U.S. District Judge Battaglia for sentencing on July 15, 2024, at 9 a.m.
DEFENDANTS Case Number 24CR0765-AJB
Katherine Lu Acquista Age: 47 Escondido, CA
SUMMARY OF CHARGES
Wire Fraud - Title 18, U.S.C., Section 1343
Maximum penalty: Twenty years in prison; $250,000 fine or the gross gain or loss from the offense, whichever is greater
INVESTIGATING AGENCY
Federal Bureau of Investigation
Defendant Charged with Distributing Fentanyl that Resulted in Overdose Deaths of Two PeopleRead the Press Release
NEWS RELEASE SUMMARY – April 25, 2024
SAN DIEGO – Scott Anthony Sargent of San Diego appeared in federal court today to face charges that he distributed the fentanyl that resulted in the deaths of two victims in North Park in 2022. During the same incident, Sargent and another person also overdosed but survived.
Sargent is also charged with conspiracy to distribute fentanyl and methamphetamine. At today’s hearing, Sargent was detained without bond.
San Diego Police officers along with investigators from the Drug Enforcement Administration’s Overdose Response Team responded to a 911 call just before 6 a.m. on November 10, 2022. When they arrived, four individuals were found lying on the floor of a bedroom. Two of the individuals, identified in court records by the initials Z.W. and M.L., were pronounced dead at the scene, while Sargent and another individual were treated with Narcan and transported to nearby hospitals where they recovered.
Sargent allegedly brought and then distributed the fatal mix of fentanyl and para-fluorofentanyl (a common fentanyl analogue) to a residence in North Park. Investigators linked Sargent to the overdoses through the fentanyl/para-fluorofentanyl mixture found at the overdose location. The mixture was also found inside Sargent’s backpack and duffel bag recovered from the scene. A subsequent search by investigators of Sargent's storage unit also turned up additional baggies containing the same combination of fentanyl/para-fluorofentanyl.
“Fentanyl kills indiscriminately,” said U.S. Attorney Tara McGrath. “Yet as was accomplished in this case investigators will leave no stone unturned in the effort to identify and charge distributors of this poison.”
“Mr. Sargent’s alleged actions cost two people their lives,” said Acting Special Agent in Charge Anthony Chrysanthis. “The San Diego DEA and its partners are dedicated to bringing to justice those that sell, traffic, or provide fentanyl in our community.”
This case is being prosecuted by Assistant U.S. Attorneys Adam Gordon and Sarah Goldwasser.
Special Agents and Task Force Officers with the Drug Enforcement Administration’s Overdose Response Team (formerly known as Team 10) led the investigation. 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 the Overdose Response Team as a response to the increase in overdose deaths in San Diego County.
DEFENDANT Case Number 24-CR-807-RSH
Scott Anthony Sargent Age: 63 San Diego, CA
SUMMARY OF CHARGES
Distribution of Fentanyl Resulting in Death – Title 18, United States Code, Sections 841(a)(1), (b)(1)(C)
Maximum penalty: Life in prison
Mandatory minimum: Twenty years in prison
Conspiracy to Distribute Fentanyl and Methamphetamine - Title 18, United States Code, Section 841(a)(1), 841(b)(1), and 846
Maximum penalty: Life in prison
Mandatory Minimum: Ten years in prison
INVESTIGATING AGENCIES
Drug Enforcement Administration
Federal Bureau of Investigation
Homeland Security Investigations
San Diego County District Attorney’s Office
San Diego Police Department
State of 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.
Man Sentenced to Nine Years in Prison for Transporting Two Girls for ProstitutionRead the Press Release
NEWS RELEASE SUMMARY – April 24, 2024
SAN DIEGO – Deonathan Abdul Gaston of Long Beach, California, was sentenced in federal court Monday to nine years in prison for transporting two girls, ages 15 and 16, to San Diego in August 2023 to engage in prostitution.
One of the victims had been reported missing from Arizona prior to being transported by Gaston from Arizona to Los Angeles and then to San Diego to engage in prostitution. Gaston had known one of the victims since she was 14.
The victims were rescued by the National City Police Department on August 13, 2023, when officers conducted a traffic stop on the defendant in a high-crime area known for prostitution. He had no driver’s license on him and was not going to be allowed to drive the car. He called his “girlfriend” to come pick up the car from the traffic stop; the girl turned out to be the missing Arizona teen. Officers then responded to the hotel where the girl said they were staying and found the other victim. The case was turned over to the San Diego Human Trafficking Task Force.
“Selling children for sex is a reprehensible crime that impacts victims for a lifetime,” said U.S. Attorney Tara McGrath. “We can all play a part in protecting the vulnerable by paying close attention to warning signs and reporting concerns. Our children are not necessarily being grabbed from the street. They are being groomed and recruited online.” Please see https://humantraffickinghotline.org/en/human-trafficking/recognizing-signs
If you are living or working under threat of violence or extortion, or you suspect someone else may be, call the National Human Trafficking Resource Center toll free, 24/7 Hotline: CALL: (888) 373-7888 or TEXT BeFree or 233733.
This case was prosecuted by Assistant U.S. Attorneys Lyndzie M. Carter and Derek Ko.
DEFENDANTS Case Number 23-cr-1944-AGS
Deonathan Abdul Gaston Age: 26 Long Beach, CA
SUMMARY OF CHARGES
Transportation for Purpose of Prostitution – Title 18, U.S.C., Section 2421(a)
Maximum penalty: Ten years in prison and $250,000 fine
INVESTIGATING AGENCIES
National City Police Department
San Diego County District Attorney’s Office
Homeland Security Investigations
Federal Bureau of Investigation
San Diego Human Trafficking Task Force
Inmate and Corrections Officer Sentenced in Bribery Scheme; Same Inmate Sentenced in Related Covid-Fraud SchemeRead the Press Release
NEWS RELEASE SUMMARY – April 24, 2024
SAN DIEGO – Shawn Brown, an inmate at Richard J. Donovan Correctional Facility, was sentenced in federal court today to 30 months in prison for bribing a state corrections officer to smuggle contraband into prison, including dental molds and an expensive bejeweled “grill” for the inmate’s mouth.
A separate consecutive sentence of 48 months was also applied for Brown’s role in a scheme to file fraudulent claims with the California Employment Development Department, effectively stealing money that was intended give economic relief to people impacted by the pandemic. Brown was ordered to pay $550,000 in restitution to the State of California.
Benito Jamar Hugie, the corrections officer who helped Brown obtain the grill, was sentenced last month to 24 months in prison. Hugie, who is out on bond, was ordered to surrender by 12 p.m. on May 6, 2024.
Hugie pleaded guilty in November of 2023, admitting that he smuggled the gold-and-diamond grill into the facility in early October, 2020, and delivered it to Brown, who had custom ordered it from a jeweler in Houston, Texas, using a smuggled cell phone. A grill, also known as “fronts” or “golds,” is a type of dental jewelry worn over the teeth. Grills are generally made of metal and precious gems and are generally removable.
According to Brown’s plea agreement, the overall value of the scheme to acquire the custom grill, to bribe the corrections officer and to smuggle the contraband into the prison was more than $30,000.
At today’s hearing, U.S. District Judge Cathy Ann Bencivengo ordered Brown to turn over the grill to the government as part of his forfeiture agreement. Brown had opposed the request, arguing that he was unable to remove the grill because it was glued to his teeth. The government referred to a jail surveillance video that showed that the grill was, in fact, removeable. In this jail surveillance video, Brown was seen removing the grill from his mouth and putting it back in.
The COVID-related fraud scheme was discovered during the investigation of the bribery scheme. Agents learned that while in custody at the Richard J. Donovan Correctional Facility, Brown used his contraband cellular telephone to coordinate the theft of unemployment benefits intended for Californians who were unable to pay for food and housing as a result of the COVID-19 pandemic. Brown and co-conspirators caused an estimated $1.4 million in fraudulent claims to be filed with the state Employment Development Department, resulting in actual cash payouts of more than $695,000 to Brown and his co-conspirators.
Brown was originally serving time at the state prison for first degree murder in violation of California Penal Code Section 187(a). At today’s hearing Judge Bencivengo ordered that today’s two federal sentences be served consecutively to each other and to the original underlying state sentence.
“Diamonds are not always your friend,” said U.S. Attorney Tara McGrath. “These schemes have cost Brown years of his life and Hugie his career and good name. Maybe regular teeth would have been a better option.”
“The FBI and our law enforcement partners remain committed to ensuring the integrity of our criminal justice systems,” said FBI San Diego Acting Special Agent in Charge John Kim. “Those who abuse their positions of trust and those who corrupt the same will be held accountable as demonstrated in this investigation.”
This case was prosecuted by Assistant U.S. Attorney Orlando Gutierrez.
DEFENDANTS Case Number 22CR1238
Shawn Brown Age: 28 California Department of Corrections and Rehabilitation Inmate
Benito Jamar Hugie Age: 49 San Diego, CA
DEFENDANT Case Number 22CR1239
Shawn Brown Age: 28 California Department of Corrections and Rehabilitation Inmate
SUMMARY OF CHARGES
- Corruption Activities Stemming from the Grill
18 USC § 371 Conspiracy to Violate the Travel Act- Bribery (Count 1)
Defendants: Hugie, Brown
28 USC § 2461(c) Criminal Forfeiture
- Indictment 2: Fraud Activities Involving EDD
18 USC § 1349 Conspiracy; Mail Fraud
Defendants: Brown
28 USC § 2461(c) Criminal Forfeiture
INVESTIGATING AGENCIES
Federal Bureau of Investigation
California Department of Corrections and Rehabilitation
Brothers Plead Guilty to Hostage-Taking of Unauthorized ImmigrantsRead the Press Release
NEWS RELEASE SUMMARY – April 23, 2024
SAN DIEGO – Virves Pablo-Francisco, a citizen of Guatemala, pleaded guilty in federal court today, admitting that he and his younger brother, Nicolas Pablo-Francisco, kidnapped three unauthorized immigrants, including a boy from Afghanistan and a father and son from Ecuador, and held them for thousands of dollars in ransom in June 2023. Nicolas Pablo-Francisco pleaded guilty to similar charges in February.
In his plea agreement, Virves Pablo-Francisco admitted that on June 13, 2023, he, his brother and others abducted a 16-year-old boy from Afghanistan and held him hostage in a residence in Escondido along with two other foreign nationals—the father and son from Ecuador who were kidnapped the day before. The defendants demanded ransom payments ranging from $4,000 to $10,000 per person for their release.
Additionally, Virves Pablo-Francisco admitted that he provided the Ecuadorian father and son no food and told them they were required to pay extra if they wanted to eat.
Nicolas Pablo-Francisco, who pleaded guilty in February, admitted holding the boy hostage and demanding ransom from his family. He also admitted assisting his older brother Virves in the continued detention of the Ecuadorian father and son pending payment of a ransom by their family.
Federal authorities first learned of the abductions late in the day on June 13, 2023, when the Pablo-Francisco brothers contacted the 16-year-old’s family member in the United States, claiming to have the boy and demanding $4,000 for his release. The family member reported the contact to law enforcement, which led to an overnight, multi-agency effort to locate the boy and identify his kidnappers.
By morning, agents with the FBI’s Child Exploitation Task Force - with support from Immigration and Customs Enforcement, the San Diego Police Department and the San Diego County Sheriff’s Office - had identified a residence in Escondido where they suspected the boy was being held. With assistance from the U.S. Attorney’s Office, FBI agents obtained and executed a federal search warrant for the residence.
Upon entering the home, agents located Nicolas Pablo-Francisco and the boy, along with the Ecuadorians who agents learned were also being held for ransom. All three migrant hostages entered the United States illegally in the days leading up to their rescue. Virves Pablo-Francisco, who was not present at the Escondido house on the day of the raid, was arrested later pursuant to a warrant.
“These victims are safe because a family member was brave enough to seek help from law enforcement officials,” said U.S. Attorney Tara McGrath. “Always report crime. We are standing by to hold those accountable who commit crimes, and to support victims and their families. Also, I urge anyone who is considering a dangerous journey into the United States: Please don’t risk your life by trusting smugglers. It could be a very costly mistake.”
“These guilty pleas demonstrate the FBI’s commitment to bringing kidnapping victims home safely,” said FBI San Diego Acting Special Agent in Charge John Kim. “Criminals involved in alien smuggling may think they will get away with taking migrants hostage because of the unique vulnerability of their victims. They are wrong.”
Nicolas Pablo-Francisco is scheduled to be sentenced on May 6, 2024, before U.S. District Judge Cynthia A. Bashant. Virves Pablo-Francisco’s sentencing hearing is scheduled to take place on July 15, 2024.
This case is being prosecuted by Assistant U.S. Attorneys Robert J. Miller, Jordan Arakawa, and David Eugene Fawcett.
DEFENDANTS Case Number 23cr01355-BAS
Virves Pablo-Francisco Age: 22 Guatemala/Escondido, CA
Nicolas Pablo-Francisco Age: 20 Guatemala/Escondido, CA
SUMMARY OF CHARGES
Hostage Taking – Title 18, U.S.C., Section 1203(a)
Maximum penalty: Life in prison and $250,000 fine
Harboring Aliens – Title 8, U.S.C., Section 1324(a)(1)(A)(iii)
Maximum Penalty: Five years in prison and $250,000 fine
INVESTIGATING AGENCY
Federal Bureau of Investigation
Drug and Ghost Gun Trafficker Sentenced to 87 MonthsRead the Press Release
NEWS RELEASE SUMMARY – April 19, 2024
SAN DIEGO – Carlos Mendoza of San Diego was sentenced in federal court today to 87 months in prison following his admission that he trafficked in methamphetamine and ghost guns.
Mendoza pleaded guilty to selling methamphetamine to undercover federal agents in February of 2023. According to the plea agreement, Mendoza also admitted to illegally selling eight privately-made firearms, which are commonly referred to as “ghost guns.” Ghost guns are assembled from firearm parts and lack markings—or contain non-standard markings—which make them difficult to trace when recovered from a crime scene.
Mendoza’s arrest was part of the Privately Made Firearm Crime Reduction Project, which ran from February to May of 2023. The project was initiated to address gun violence and the proliferation of ghost guns in San Diego. The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and the San Diego Police Department (SDPD) used data analytics to determine areas where there was an increase in gun violence and where crime guns were being recovered. ATF and SDPD employed an intelligence-led policing effort throughout the 90-day initiative to determine where to place resources to have the greatest impact. The project resulted in the seizure of 165 ghost guns and the prosecution of 33 people, including Mendoza.
“Removing dangerous drugs and illegal guns from the street makes all of us safer,” said U.S. Attorney Tara McGrath. “Now we’ve removed a dealer from the equation, too.”
“Individuals who are engaged in the business of making firearms for livelihood or profit as opposed to personal use, must obtain a federal firearms license, and must comply with federal laws that require firearms to be serialized,” said ATF Los Angeles Field Division Special Agent in Charge Christopher Bombardiere. “ATF will continue to investigate criminal possession of ghost guns and those who traffick them with its local partners to make our communities safer.”
This case was prosecuted by Assistant U.S. Attorney Shital H. Thakkar.
DEFENDANT Case Number 23-cr-01436-RBM
Carlos Mendoza Age: 31 San Diego, CA
SUMMARY OF CHARGES
Distributing Methamphetamine – Title 21, U.S.C., Section 841(a)(1)
Maximum penalty: Life in prison and $10 million fine
AGENCY
Bureau of Alcohol, Tobacco, Firearms and Explosives
*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
Man Charged in $1.49 Million Scam Involving Bitcoin ATM Deposits and Bulk Gold Purchases; Victim is Retiree who Lost Life SavingsRead the Press Release
NEWS RELEASE SUMMARY – April 18, 2024
SAN DIEGO – Xilin Sun made his first appearance in federal court today to face charges that he participated in a multinational fraud conspiracy that targeted a 70-year-old retiree from Carlsbad who was tricked into handing over $1.335 million.
According to the complaint, the San Diego Elder Justice Task Force learned of the fraud scheme after the victim reported to Carlsbad police that she was duped over a period of months by fraudsters posing as government, bank and tech-support employees. Specifically, she said she was using her computer when a pop-up window appeared, advising her to call for help because her computer had been hacked.
When she made the call, she was transferred through a series of co-conspirators pretending to work in tech support who told her to download software on her computer. She was also told her personal identifying and bank account information were compromised and was subsequently referred to co-conspirators posing as employees from her financial institutions. The victim was then told she needed to “secure” her assets. At the direction of someone posing as a bank employee, she deposited approximately $55,700 into Bitcoin ATMs located in North County San Diego.
The complaint further describes how once the scammers discovered the victim had substantial savings, they convinced her she could safeguard her funds by obtaining gold bars and sending them to the U.S. treasury, which would create a locker under her name. Over the course of two months, the victim sent approximately $1,335,000 via three separate wire transfers to a precious metal business located in San Marcos, California. Once each of the wire transfers were completed, the victim was instructed to pick up the purchased precious metals—consisting of mostly gold—and to package them. The victim was then directed to hand the package over to an individual under the false pretense that it was being “secured” for safekeeping. In reality, the victim was scammed out of her life savings.
According to the complaint, in February 2024, the scammers reached out to the victim yet again and instructed her to purchase $100,000 worth of additional gold. This time, however, the victim contacted the FBI, which set up a controlled delivery of a package made to look like it contained $100,000 in gold.
The complaint described how the victim met with one of the conspirators outside a bank in Carlsbad. After handing the package to the conspirator, task force agents followed the first conspirator, who traveled approximately two miles before handing the package to a second conspirator, later identified as defendant Xilin Sun.
Sun was stopped by the California Highway Patrol, the complaint said. In Sun’s vehicle, investigators located the fake gold package and the victim’s receipt. Agents also located additional evidence linking Sun to the victim, including photos of the fake gold the victim had sent to the conspirators over the phone, a copy of an invoice, and the receipt for the gold.
“If you think you may have been scammed, report it immediately,” said U.S. Attorney Tara McGrath. “These schemes are organized by sophisticated global networks with the ability to fool even the most savvy computer users. But if victims report quickly, we have a better chance of catching the scammers and retrieving stolen money.”
“Thousands of people fall victim to elder fraud every year. Many do not report the fraud because they are embarrassed or afraid; however, the best course of action is to report scams as early as possible,” said Acting Special Agent in Charge John Kim. “The San Diego Elder Justice Task Force is dedicated to relentlessly pursuing criminals who prey on innocent individuals for personal gain.”
This case was investigated by the San Diego Elder Justice Task Force and its member agencies, including the U.S. Attorney’s Office, Federal Bureau of Investigation, San Diego County District Attorney’s Office, Carlsbad Police Department, San Diego Police Department, and the California Highway Patrol.
If you or someone you know is age 60 or older and has been a victim of financial fraud, help is available through the National Elder Fraud Hotline: 1-833 FRAUD-11 (1-833-372-8311). You can also report fraud to any local law enforcement agency or on the FBI’s Internet Crime Complaint Center at www.ic3.gov.
The FBI requests victims report:
- The name of the person or company that contacted you.
- Methods of communication used, including websites, emails, and telephone numbers.
- Any bank account number(s) to which you wired funds and the recipient name(s).
- The name and location of the metal dealer company and the account to which you wired funds, if you were instructed to buy precious metals.
This case is being prosecuted by Assistant U.S. Attorney Kevin Mokhtari.
DEFENDANT Case Number 24MJ1502-BLM
Xilin Sun Age: 35 Ontario, California
SUMMARY OF CHARGES
Conspiracy to Commit Wire Fraud – Title 18, U.S.C., Section 1349
Criminal Forfeiture – Title 18, U.S.C., Sections 981(a)(1)(C), 982(a)(2)(A), and Title 28, U.S.C., Section 2461(c)
Maximum Penalties: Thirty years in prison; $1 million fine
AGENCIES
Federal Bureau of Investigation
San Diego Elder Justice Task Force
Carlsbad Police Department
California Highway Patrol
San Diego County District Attorney’s Office
San Diego Police Department*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
Virginia-Based Defense Contractor Pleads Guilty to Bribery Conspiracy Involving Government Contracts Worth More Than $100 MillionRead the Press Release
NEWS RELEASE SUMMARY – April 16, 2024
SAN DIEGO – Cambridge International Systems, Inc., a defense contractor headquartered in Arlington, Virginia, pleaded guilty in federal court today, admitting that it participated in a bribery scheme with the company’s former Executive Vice President Russell Thurston, and former Naval Information Warfare Center employee James Soriano, among others.
According to Cambridge’s plea agreement, the company — acting through Thurston and an unnamed employee — gave various things of value to Soriano, including jobs for Soriano’s family and friends, meals, and a ticket to the 2018 MLB All Star Game held at Nationals Park in Washington D.C. One of the friends hired by Cambridge, Liberty Gutierrez, was giving Soriano $2,000 a month from her Cambridge salary, according to Gutierrez’s plea agreement.
In return, Soriano, acting in his position as a contracting officer’s representative at Naval Information Warfare Center ensured that Cambridge was awarded two large task orders. Soriano further ensured Cambridge was able to capture a steady stream of government funds by approving various projects on the task orders after they were awarded the contract, including more than 70 projects on one of the task orders. As a result of the conspiracy, the government obligated more than $32 million on one of the task orders and over $100 million on the other.
Soriano also allowed Cambridge employees to draft various procurement documents for him, even where the company was competing for the contract against other bidders. Thurston and Soriano worked together to remove document properties so other government employees would not know of Cambridge’s involvement in drafting the documents.
Cambridge admitted that the company made a total profit of $7,429,995.23 as a result of the conspiracy. Cambridge is next scheduled to appear before U.S. District Judge Todd W. Robinson for sentencing on July 3, 2024.
“Service members depend on the honesty and integrity of our nation’s defense contractors to be able to do their jobs,” said U.S. Attorney Tara McGrath. “A business model based on fraud is both illegal and undermines the fairness of the system.”
“The guilty plea of Cambridge International Systems, Inc. is a constructive step towards holding the company accountable for its active participation in an illegal scheme that corrupted the government’s acquisition processes,” said Bryan D. Denny, Special Agent in Charge of the Department of Defense Office of Inspector General, Defense Criminal Investigative Service, Western Field Office. “Such illicit actions ultimately waste invaluable U.S. taxpayer money and degrade American warfighter readiness.”
“Cambridge International Systems, Inc. demonstrated a culture of complicity in undermining the defense contracting process,” said Special Agent in Charge Tyler Hatcher, IRS Criminal Investigation, Los Angeles Field Office. “IRS:CI is committed to supporting investigations into activities that can harm national security, whether directly or indirectly, and to working with our law enforcement partners to ensure our warfighters are protected from this sort of corruption.”
“Bribery and procurement fraud within the Department of the Navy threatens warfighter safety and perpetuates unfair contracting practices that negatively affect honest businesses,” said Special Agent in Charge Greg Gross of the NCIS Economic Crimes Field Office. “NCIS and our partners remain committed to exposing those who abuse the procurement process for personal gain.”
Thurston and Soriano are separately charged with conspiracy to commit bribery and bribery in case number 24CR341-TWR.
DEFENDANTS Case Number 24-cr-759-TWR
Cambridge International Systems, Inc. Arlington, VA
SUMMARY OF CHARGES
Conspiracy to Commit Bribery - Title 18, U.S.C., Section 371
Maximum penalty: Five years corporate probation; a maximum $500,000 fine or twice the gross gain or loss resulting from the offense, whichever is greatest.
INVESTIGATING AGENCIES
Defense Criminal Investigative Service
Naval Criminal Investigative Service
Small Business Administration – Office of Inspector General
Internal Revenue Service Criminal Investigation
Department of Health and Human Services – Office of Inspector General
If you have information regarding fraud, waste, or abuse relating to Department of Defense personnel or operations, please contact the DoD Hotline at 800-424-9098.
United States Recovers More Than $2 Million in Aircraft Collision CaseRead the Press Release
NEWS RELEASE SUMMARY – April 16, 2024
SAN DIEGO – The United States has recovered $2,020,000 in a lawsuit it brought on behalf of the Department of the Navy for damages incurred as a result of a May 30, 2020, aircraft collision at Brown Field Municipal Airport in San Diego.
In 2023, the United States brought a lawsuit against defendants Christopher Sanders, Tac Air Ops, LLC, Tac Air California, Inc., Kapowsin Air Sports, Ltd., the City of San Diego, Brown Field Municipal Airport, Brown Field Aviation Ventures, Inc., and Lancair Corporation seeking damages as a result of the defendants’ negligent acts and/or omissions arising from the aircraft collision. The collision involved a parked United States Marine Corps MV-22 “Osprey” aircraft and a taxiing De Havilland DHC-6-100 “Twin Otter” aircraft, owned by Kapowsin, and leased and operated by the Tac Air defendants.
On April 15, 2024, the United States and defendants stipulated to dismiss the case with prejudice, after entering a global settlement agreement in which the United States recovered $2,020,000.
“This unfortunate incident caused an MV-22 to be stricken from service, which resulted in a significant loss to the United States and the Department of the Navy,” said U.S. Attorney Tara McGrath. “Securing an early resolution in this case achieved the right result,” said McGrath.
This case was handled by Assistant U.S. Attorney Mary Cile Glover-Rogers.
Case Number
United States of America v. Christopher Sanders et al., 23-cv-1000-W-DDL
SUMMARY OF CLAIMS
1. Negligence
2. Breach of Restrictive Covenants
AGENCY
The United States brought this lawsuit on behalf of the Department of the Navy
Final Defendants Sentenced in $65 Million TRICARE FraudRead the Press Release
NEWS RELEASE SUMMARY – April 12, 2024
SAN DIEGO – The final two members of a massive conspiracy to bilk TRICARE, the military’s healthcare program, out of more than $65 million have been sentenced in federal court.
Former U.S. Marine Joshua Morgan and former U.S. Navy Sailor Kyle Adams were sentenced to 21 months and 15 months, respectively, and ordered to pay millions in restitution and forfeit the fruits of their criminal activity.
Morgan and Adams have admitted that they recruited fellow servicemembers and their dependents to receive expensive prescription compounded drugs, while others in the conspiracy wrote bogus prescriptions and filled out duplicitous paperwork to process fraudulent insurance reimbursements, resulting in at least $65 million in losses to TRICARE.
Both the defendants were working for Jimmy and Ashley Collins, a married couple living in Birchwood, Tennessee, who quarterbacked the scheme. Jimmy Collins received a 10-year prison sentence; Ashley Collins was sentenced to 18 months in home confinement. To account for all the fraud, the couple was ordered to pay $65,679,512.71 in restitution to Defense Health Agency and TRICARE. Other patient recruiters, including Daniel Castro, Jeremy Syto and Bradley White were previously sentenced to custody.
According to plea agreements, the servicemembers that Morgan and Adams recruited agreed to receive the pricey compounded medications in return for a monthly kickback of approximately $300. For young Sailors and Marines-turned-straw-beneficiaries, this money was equivalent to a significant portion of their monthly paycheck. Morgan noted that “it took very little work to sign people up to receive free money.”
For recruiting bogus patients, defendants Morgan and Adams were paid an illegal kickback of between 3 and 7 percent of the total TRICARE reimbursement paid to the pharmacy for the drugs sent to their recruits. By the time this fraud scheme was in full swing, the average cost for these compounded drugs was over $13,000 for a 30-day supply, peaking at around $25,000 for individual drugs.
Over the course of the conspiracy, those illegal kickbacks amounted to at least $2,633,942.69 for Morgan, which, in recognition of his role as the top-level recruiter in this multi-level marketing scheme, was more than twice as much as the next nearest patient recruiter. Meanwhile, Adams earned more than $1 million for his efforts.
To fund these kickbacks, based on false pretenses and representations, TRICARE paid at least $11,490,654.00 in insurance reimbursements for compounded medications prescribed to straw beneficiaries directly recruited by defendant Adams. During the same period, TRICARE paid at least $4,418,709 for compounded medications prescribed to straw beneficiaries directly recruited by defendant Morgan, although that amount underrepresents the severity of his criminal conduct due to his role as a top-level recruiter responsible in part for the losses to TRICARE caused by various sub-recruiters.
The doctors, Carl Lindblad and Susan Vergot, and a nurse practitioner, Candace Craven, who wrote the fraudulent prescriptions and filled out other duplicitous paperwork, were previously sentenced. The pharmacy that filled the fraudulent prescriptions, CFK, Inc., also previously pleaded guilty.
According to the pleadings, the sharp increase in the number of bogus prescriptions for compounded drugs was the result of multiple fraud schemes, including this one, that popped up around the country. As a result, the TRICARE program faced a $2 billion explosion in liability for compounded prescription drugs.
“Today’s sentencing closes the last chapter on this outrageous fraud scheme that almost put TRICARE into bankruptcy,” said U.S. Attorney Tara McGrath. “Our military members and taxpayers deserve so much better. The magnitude and significance of this case reflects our continued dedication to the well-being of the armed forces and their families, as well as our steadfast protection of the U.S. taxpayer.”
“NCIS will not stand by as individuals shamelessly attempt to disrupt the lives of those who have and continue to serve our country, and steal from what they rightfully earned,” said Director Omar Lopez, Naval Criminal Investigative Service. “This case highlights NCIS’ investigative capabilities and our commitment to collaborate with our law enforcement partners in detecting and dismantling these criminal acts of fraud.”
“Today’s sentencing demonstrates the Defense Criminal Investigative Service’s (DCIS) unwavering commitment to hold accountable those individuals who commit TRICARE fraud and imperil our military healthcare system,” said Kelly Mayo, Director DCIS. “The outstanding work of the investigative team ensured the perpetrators were held criminally accountable. I want to thank the U.S. Attorney’s Office and the Naval Criminal Investigative Service for their continuing dedication to the pursuit of justice.”
During the course of the investigation, authorities seized numerous items and properties purchased by the Collinses and others with the proceeds of the fraud, including an 82-foot yacht; multiple luxury vehicles, including two Aston Martins; a multimillion-dollar investment annuity; gold and silver bars; cashier’s checks; dozens of pieces of farm equipment and tractor-trailers; and three pieces of Tennessee real estate.
This case was prosecuted by Assistant U.S. Attorney Mark W. Pletcher.
DEFENDANTS Case Number: 18-CR-1027-JLS
Joshua Morgan Age: 31 San Diego, CA
DEFENDANTS Case Number: 18-CR-0432-JLS
Kyle Adams Age: 36 Victoria, Texas
SUMMARY OF CHARGES
Joshua Morgan:
Conspiracy, in violation of 18 U.S.C. § 1349, 1347
Maximum penalty: Ten years in prison and $250,000 fine or double loss amount, whichever is greater
An order of restitution requiring defendant to repay at least $4,418,709 to DHA/TRICARE
Kyle Adams:
Conspiracy, in violation of 18 U.S.C. § 1349, 1347
Maximum penalty: Ten years in prison and $250,000 fine or double loss amount, whichever is greater
An order of restitution requiring defendant to repay at least $11,490,654 to DHA/TRICARE
INVESTIGATING AGENCIES
Defense Criminal Investigative Service
Naval Criminal Investigative Service
IRS Criminal Investigation Division, Gulfport, MS
Federal Bureau of Investigation - Jackson, MS Field Office
Woman Convicted by Federal Jury of Burning Down Local San Diego BusinessRead the Press Release
NEWS RELEASE SUMMARY – April 8, 2024
SAN DIEGO – A federal jury has convicted Carey Alice Hernandez, bookkeeper for Off Road Warehouse headquartered in Kearny Mesa, of intentionally setting fire to the business to cover up the disappearance of more than $700,000 while she was in charge of company finances.
After a four-day trial, jurors found Hernandez guilty of malicious destruction of a building by means of fire, witness tampering and making false statements.
In late 2018, the owner of Off Road Warehouse, also known as ORW, which sold and installed automotive parts and gear for off-roading, decided to sell the business located at 7915 Balboa Avenue. The purchaser began an audit of ORW. The audit revealed that during Hernandez’s tenure as bookkeeper and controller in charge of the company books and records, $744,621 went missing between January 2015 and March 2019.
The jury found that in the early morning hours of March 28, 2019, Hernandez started the fire at Off Road Warehouse, causing the building to burn to the ground.
According to evidence presented at trial, shortly before the fire, local surveillance video showed an SUV with dark wheel rims driving near the defendant’s house in Point Loma. Further video surveillance showed the defendant driving the same vehicle to the scene of the arson before she started the inferno. Surveillance also showed her driving back home after the fire, in the same dark-rimmed SUV.
The day after the fire, Hernandez sent misleading texts to ORW employees in an attempt to convince them her wheel rims were light, not dark. Specifically, after learning that law enforcement was searching for a dark- rimmed SUV, she tried to convince employees who had changed her vehicle’s distinctive rims before the fire that her vehicle had light rims during the time of the fire and thus, the SUV spotted on surveillance cameras could not be hers.
During a subsequent interview with special agents from the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), Hernandez lied about the distinctive rims on her vehicle. However, the lies to law enforcement and attempts to tamper with witnesses were contradicted by the video surveillance from the day after the fire, showing the defendant driving around San Diego in her dark-rimmed, not light-rimmed, SUV. These acts resulted in her convictions for witness tampering and false statements.
ATF’s National Response Team (NRT) investigated this case in conjunction with San Diego’s Metro Arson Strike Team (MAST). The NRT is ATF’s mobile, rapid response team which investigates the cause and origin of large fires, explosions and bombings at the request of local public safety agencies.
“While it is extremely fortunate that no one was physically hurt in this blaze, it was a devastating loss for the company,” said U.S. Attorney Tara McGrath. “This defendant used arson, tampering with witnesses, and deceit to put the community in danger, but the jury held her accountable.”
“ATF’s National Response Team responded to this multimillion-dollar loss within 24 hours determining the fire was deliberately set,” said ATF Los Angeles Field Division Special Agent in Charge Chris Bombardiere. “Arson crimes are not victimless fires. This criminal act devastated a business and the livelihood of several individuals and families. ATF stands willing and ready to partner with federal, state, and local public safety officials to keep our communities free from dangerous arsonists.”
Hernandez is scheduled to be sentenced July 12, 2024, at 9:30 a.m. before U.S. District Judge Jinsook Ohta.
This case is being prosecuted by Assistant U.S. Attorneys Matthew Brehm and Carl Brooker.
DEFENDANT Case Number 22cr145-JO
Carey Alice Hernandez Age: 46 Rathdrum, Idaho
SUMMARY OF CHARGES
Malicious Destruction of Building by Means of Fire – Title 18, U.S.C., Section 844(i)
Maximum penalty: No less than five years in prison and no more than 20 years and $250,000 fine
Witness Tampering – Title 18, U.S.C., Section 1512(b)(3)
Maximum penalty: Twenty years in prison and $250,000 fine
False Statements – Title 18, U.S.C., Section 1001(a)(2)
Maximum penalty: Five years in prison and $250,000 fine
INVESTIGATING AGENCY
Bureau of Alcohol, Tobacco, Firearms, and Explosives
Man Who Distributed Fentanyl that Resulted in Teenager’s Death Sentenced to More than 12 Years in PrisonRead the Press Release
NEWS RELEASE SUMMARY – April 5, 2024
SAN DIEGO – Jose Daniel Ramirez of San Diego was sentenced in federal court today to 151 months in prison for selling the fentanyl pills that resulted in the fatal overdose of 18-year-old Poway resident Kole William Pearson on January 3, 2023.
According to court documents, Ramirez sold “2 blues,” which were fentanyl pills disguised as oxycodone, to Pearson, who died of a fentanyl overdose after taking them. Ramirez learned of Pearson’s death and quickly changed his phone number, informed clients of his new number, and continued to sell fentanyl.
About a month later, law enforcement officers arrested Ramirez, secured a warrant and searched his residence, where they found approximately 2,600 blue pills containing fentanyl, other drugs including cocaine, plus two Glock handguns and over 250 rounds of various ammunition. One of the handguns was fully loaded with a round of ammunition in the chamber.
“The defendant knew his product had already taken one life, yet he continued to sell fentanyl pills from the same deadly batch,” said U.S. Attorney Tara McGrath. “There is nothing we can do to bring Kole Pearson back, but we join his family and friends in lifting up his memory and pledge to continue our relentless pursuit of those who value profit more than human lives.”
“HSI continues to work with our state, local and federal partners to identify, disrupt, and dismantle fentanyl trafficking networks through the HSI-led FAST task force,” said Christoper Davis, acting special agent in charge for HSI San Diego. “Members of FAST are fully committed to aggressively pursuing justice against the organizations and individuals who are responsible for dealing this deadly drug in San Diego and further into the United States.”
HSI San Diego FAST is a multiagency task force comprising state, local, and federal partners and was first established in August 2022 focusing on the disruption and dismantlement of criminal organizations that smuggle and distribute fentanyl within San Diego County. HSI’s FAST targets fentanyl smuggling and distribution networks to counter the rising overdose rate and decrease the availability and accessibility of fentanyl.
According to the government’s sentencing memo, which quoted victim impact statements, Pearson’s family described him as “a big guy with a huge personality and the biggest silly smile you’ve ever seen,” and a “very bright, thoughtful, and intelligent” guy who everyone liked. His sisters said they lost their “charming, funny, and goofy little brother.” His friends recognized his “kindness, funny antics, and genuine friendship.” Pearson worked at a Jersey Mike’s sandwich shop and planned to use his experience to attend culinary school or possibly a vocational program.
The sentencing memo noted that Pearson’s death has touched everyone in his life deeply and will be felt for a lifetime. Even Pearson’s high school teacher memorializes him by keeping an empty seat in the class.
This case is being prosecuted by Assistant U.S. Attorneys Sean Van Demark and Dylan M. Aste.
DEFENDANT Case Number 23cr00274-RBM
Jose Daniel Ramirez Age: 21 San Diego, CA
SUMMARY OF CHARGES
Distribution of Fentanyl – Title 18, United States Code, Section 841(a)(1)
Maximum penalty: Twenty years in prison
INVESTIGATING AGENCIES
Homeland Security Investigations
San Diego County Sheriff’s Department
U.S. Drug Enforcement Administration
Seven Charged in Theft of California Benefits for Low-Income FamiliesRead the Press Release
NEWS RELEASE SUMMARY – March 4, 2024
SAN DIEGO – Seven people were arrested and charged this week in connection with the theft of hundreds of thousands of dollars in public-assistance benefits from low-income families that need the funds to pay for food, housing and other necessities.
The defendants were taken into custody by a U.S. Secret Service-led task force as part of a three-day effort to crack down on this devastating and growing fraud in which California benefits are drained from recipients’ accounts almost immediately after the funds are dispersed by the state, typically early in the month. A simultaneous operation netted three arrests in the Northern District of California.
Marian Dogaru, Catalan Craciun, Vasile Ionita, Andrei Cristian Geangasau, Domitru Ducila Unguru, Roberto Calin and Razvan Iulian Gaspar are charged with stealing Electronic Benefit Transfer (EBT) account information and making fraudulent cash withdrawals at ATMs using that stolen EBT information.
According to the complaints, between June 2022 and February 2024, over $181 million has been stolen from EBT beneficiaries in California. Most of these stolen funds have come from unauthorized ATM withdrawals. The complaints also allege that victims of the scheme are largely low-income families who depend on EBT benefits to buy food and other household necessities.
“EBT fraud literally takes food out of the mouths of children,” said U.S. Attorney Tara McGrath. “Parents who don’t know they’ve been targeted get to the grocery checkout and discover their EBT cards have been wiped clean. We are taking proactive steps to prevent this appalling crime and punish those who take advantage of vulnerable people.”
“EBT fraud continues to be an issue in California and throughout the nation,” said Assistant Special Agent in Charge Michael Peck, U.S. Secret Service Office of Investigations. “The U.S. Secret Service will continue to investigate and arrest those responsible for EBT fraud as we seek to disrupt their networks and protect our most vulnerable communities.”
According to charging documents, here’s how the fraud works:
The Department of Agriculture’s Supplemental Nutrition Assistance Program (SNAP) is a federally funded assistance program designed to help low-income individuals and families purchase food. In California, SNAP public assistance benefits are distributed through CalFresh and loaded to an account that a qualified recipient can access by means of an access card, similar to a debit or credit card, called the California Advantage Electronic Benefit Transfer (EBT) Card.
The Department of Health and Human Services administers the Temporary Assistance to Needy Families (TANF) program, which provides states with money to support low-income families with children. In California, TANF grant funds are used to operate CalWORKS. Families that apply and qualify for ongoing CalWORKS assistance receive money each month to help pay for housing, food, and other necessary expenses. Like CalFresh, CalWORKS benefits are distributed through the California Advantage EBT card.
To access these benefits, recipient swipe their card through a point-of-sale terminal, or insert it into an ATM, and provide their Personal Identification Number (PIN).
According to the complaints, the U.S. Secret Service has gathered evidence indicating members of what appear to be one or more criminal enterprises are stealing California EBT account information by installing skimmers on point-of-sale terminals and inside ATMs, often in communities with higher concentrations of public benefit recipients. The skimmed data is then often re-encoded onto the magnetic strips of cards that members of the conspiracy use to make unauthorized withdrawals and purchases.
These re-encoded cards are sometimes referred to as “cloned” cards. Cloned cards can be a blank white plastic card, or another debit, credit, or gift card. Cloned cards may have names or numbers embossed on the physical face of the card. A common feature of cloned cards is that the account number encoded on the card’s magnetic strip will not match the number embossed on the card’s face. To facilitate the use of the stolen EBT benefits, members of the scheme will commonly put stickers bearing the account’s PIN on the physical cards, or access devices, that are swiped at a point-of-sale terminal, along with the account balance.
U.S. Attorney McGrath thanked the many law enforcement partners whose work and dedication made this operation a success: The U.S. Secret Service, California Highway Patrol, U.S. Department of Health and Human Services Office of Inspector General, Oceanside Police Department, California Department of Social Services, Homeland Security Investigations, San Diego District Attorney’s Office, San Diego Police Department, San Diego Sheriff’s Department, U.S. Department of Agriculture’s Office of Inspector General, Los Angeles District Attorney’s Office, and the United States Attorney’s Office for the Central District of California.
If you or someone you know has had your EBT benefits stolen, San Diego County’s Department of Health & Human Services Agency requires that the theft be reported within 10 days. More information for San Diego County victims is available at:
https://www.sandiegocounty.gov/content/sdc/hhsa/programs/ssp/ebt_fraud.html.
DEFENDANT Case Number Age Hometown
Marian Dogaru 24MJ1315 38 Barlad City, Romania
Catalan Craciun 24MJ1234 36 Barlad, Romania
Vasile Ionita 24 MJ1289 22 Bucharest, Romania
Andrei Cristian Geangasau 24 MJ1289 23 Bucharest, Romania
Domitru Ducila Unguru 24MJ1298 20 Craiova, Romania
Roberto Calin 24MJ1298 19 Rome, Italy
Razvan Iulian Gaspar 24MJ1345 33 Targu Mures City, Romania
SUMMARY OF CHARGES
Use of Unauthorized Access Devices – Title 18, U.S.C., Section 1029(a)(2) (All Defendants)
Maximum penalty: Ten years in prison and $250,000 fine
Possession of Access Device-Making Equipment – Title 18, U.S.C., Section 1029(a)(4) (Dogaru, Ionita, Geangasu, Unguru, Calin, Gaspar)
Maximum penalty: Fifteen years in prison and $250,000 fine
INVESTIGATING AGENCIES
U.S. Secret Service’s Southern California Cyber Fraud Task Force
San Diego District Attorney’s Office
California Highway Patrol
U.S. Department of Health and Human Services’ Office of Inspector General
California Department of Social Services
San Diego Police Department
San Diego Sheriff’s Department
U.S. Department of Agriculture’s Office of Inspector General
Homeland Security Investigations
Los Angeles District Attorney’s Office
United States Attorney’s Office for the Central District of California
United States Attorney’s Office for the Northern District of California
*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
Current and Former Minor League Baseball Players Indicted for Insider Trading in Del Taco StocksRead the Press Release
NEWS RELEASE SUMMARY – March 26, 2024
SAN DIEGO – An indictment was unsealed today charging current and former minor league baseball players Jordan Qsar, Grant Witherspoon and Austin Bernard with insider trading in Del Taco, Inc. stocks after they received advanced notice of the acquisition of Del Taco by Jack in the Box, Inc. on December 6, 2021.
According to the indictment, Qsar learned from a close friend who worked at Jack in the Box that the company was acquiring Del Taco. The friend was a senior associate in Jack in the Box’s strategic finance department who personally worked on the acquisition project. The disclosure was a violation of duties to Jack in the Box and its shareholders.
The indictment states that Qsar fraudulently shared the inside information with Witherspoon and Bernard, who were connected to Qsar through collegiate and minor league baseball teams at Pepperdine University and the Tampa Bay Rays.
In the following months, after learning the inside information, Qsar, Witherspoon, and Bernard purchased Del Taco stocks, discussed when and how many shares they were purchasing, and tipped others with the inside information.
According to the indictment, after Jack in the Box and Del Taco went public with the acquisition on December 6, 2021, Del Taco stocks jumped in price from $7.53 to $12.51 per share—representing a 66 percent increase from the prior trading day’s closing price. In the days following, Qsar, Witherspoon, and Bernard sold all their Del Taco stocks, earning them illegal profits of approximately $56,000, $41,800, and $64,600, respectively.
“The system has to be fair for everyone, or the market fails,” said U.S. Attorney Tara McGrath. “Those who seek to undermine this system for personal gain will face consequences.”
“Insider trading directly affects the integrity of our economy,” said FBI San Diego Special Agent in Charge Stacey Moy. “We will continue to work with our federal, state, and local law enforcement partners to ensure people who intentionally undermine and threaten our economy will be brought to justice.”
This case is being prosecuted by Assistant U.S. Attorney Ronald Sou.
DEFENDANTS Case Number: 24-CR-0385-DMS
Jordan Joseph Qsar Age: 28
Grant Lee Witherspoon Age: 27
Austin Lane Bernard Age: 28
SUMMARY OF CHARGES
Title 18 U.S.C. 371 – Conspiracy
Maximum Penalty: Five years in prison; $250,000 fine
Title 15 U.S.C. 78j(b), 78ff & Title 17 C.F.R. 240.10b-5 and 240.10b5-1 – Securities Fraud
Maximum Penalty: Twenty years in prison; $5 million fine
Title 18 USC 1343 – Wire Fraud & Title 18 USC 2 – Aiding and Abetting
Maximum Penalty: Twenty years in prison; $250,000 fine
Title 18 USC 981(a)(1)(C) and Title 28 USC 2461(c) – Criminal Forfeiture
INVESTIGATING AGENCY
Federal Bureau Investigation
*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
International Trafficker of Counterfeit Apple Products Sentenced to PrisonRead the Press Release
NEWS RELEASE SUMMARY – March 25, 2024
SAN DIEGO – Zhiwei “Allen” Liao was sentenced in federal court today to 51 months in prison for his role as an organizer and leader of an international conspiracy to traffic in counterfeit Apple products. The defendant was also ordered to forfeit two residences along with $120,370 in U.S. currency and more than 200 Apple devices seized during the investigation.
According to court documents, Zhiwei Liao and his brothers, Zhimin Liao and Zhiting Liao, led an international exchange fraud scheme involving more than 10,000 counterfeit iPhones and iPads. The Liaos imported counterfeit iPhones and iPads from China that looked genuine and included identification numbers (IMEI and serial numbers) matching identification numbers on real iPhones and iPads that were under warranty and had been previously sold to customers in the United States and Canada. At the direction of the Liao brothers, co-conspirators traveled to hundreds of Apple Stores across the United States and Canada, and attempted to exchange counterfeit iPhones and iPads for genuine iPhones and iPads resulting in a loss of $6.1 million to Apple, Inc. Zhiwei Liao then sent the fraudulently obtained, but genuine Apple products primarily to China where they were sold at a premium.
In court today, U.S. District Judge Cynthia Ann Bashant said that a significant prison sentence was appropriate because Zhiwei Liao was the organizer and leader of an extensive international criminal organization that trafficked in counterfeit goods throughout North America for several years.
The scheme was sophisticated and dynamic, involving counterfeit devices imported from China that looked like genuine devices under warranty. Zhiwei Liao micromanaged the operations and created a moving target for law enforcement by directing counterfeit Apple products and criminal proceeds to be sent to different co-conspirators, companies, and family members throughout the scheme. Co-conspirators supported these efforts to avoid law enforcement by exchanging the counterfeit products using a variety of false names and email accounts.
The defendant’s brothers, Zhimin Liao and Zhiting Liao, who were also leaders of the conspiracy, were previously sentenced to 41 months in custody in October 2023.
This case is part of a multi-year investigation led primarily by the Federal Bureau of Investigation and the San Diego Police Department that resulted in 12 felony convictions, the forfeiture of five residences in San Diego with an estimated value of more than $4.1 million, over $250,000 in cash, and more than 200 Apple products that were either counterfeit, fraudulently obtained, or used during the criminal operations.
“This was a massive, sophisticated fraud that victimized not only Apple, Inc., but thousands of Apple product owners across North America,” said U.S. Attorney Tara McGrath. “Theft of intellectual property and the sale of counterfeit goods are growing global problems with serious economic implications.”
“Mr. Liao’s sentencing closes a major chapter in a multi-year investigation that exposed an international, elaborate scheme to sell counterfeit goods worldwide,” said FBI San Diego Special Agent in Charge Stacey Moy. “This investigation would not have been successful without the unwavering dedication and persistence of our law enforcement partners. We remain diligent in the pursuit of justice to help maintain the integrity of our economy.”
This case is being prosecuted by Assistant U.S. Attorney Timothy F. Salel.
DEFENDANTS Case Number 19cr4407-BAS
Zhiwei Liao, aka “Allen” San Diego, CA Age: 34
Zhimin Liao, aka “Jimmy” San Diego, CA Age: 36
Zhiting Liao, aka “Tim” San Diego, CA Age: 33
Dao Trieu La, aka “Selena” San Diego, CA Age: 32
Mengmeng Zhang, aka “Aria” San Diego, CA Age: 31
Tam Nguyen, aka “Kelly,” San Diego, CA Age: 39
Charley Hsu San Diego, CA Age: 41
Danny Tran Chan San Diego, CA Age: 32
Phillip Pak, aka “Teddy” San Diego, CA Age: 33
Deedee Zhu, aka “David,” San Diego, CA Age: 35
Jiaye Jiang, aka “joejoekong” San Diego, CA Age: 34
Hyo Yang, aka “Will” San Diego, CA Age: 33
SUMMARY OF CHARGES
Conspiracy to Traffic in Counterfeit Goods – Title 18, U.S.C., Section 2320
Maximum penalty: Ten years in prison, $2 million fine, mandatory restitution, and forfeiture.
INVESTIGATING AGENCIES
Federal Bureau of Investigation
San Diego Police Department
San Diego County Sheriff’s Department
U.S. Customs and Border Protection
Homeland Security Investigations
U.S. Marshals
Man Admits Smuggling Seven Unauthorized Immigrants Through Sewer Pipes between Mexico and the U.S.Read the Press Release
NEWS RELEASE SUMMARY – March 21, 2024
SAN DIEGO –Kevin Noe Campos Villa of Tijuana pleaded guilty in federal court today to human smuggling charges, admitting he guided seven unauthorized immigrants through sewer pipes during heavy rains. Several had to be rescued from the Tijuana River by San Diego lifeguards.
Campos is scheduled to be sentenced on June 17, 2024, at 10:00 a.m. before U.S. District Judge Linda Lopez.
Campos was arrested on January 22, 2024, after U.S. Border Patrol agents observed Campos directing the individuals from Mexico into the United States through the pipes about two miles west of the San Ysidro Port of Entry during heavy rains.
When confronted by Border Patrol agents, Campos and three of the immigrants he was guiding ran to avoid apprehension. While attempting to escape, they fell into the Tijuana River and had to be rescued by San Diego lifeguards.
According to court records, two of the unauthorized immigrants who were rescued stated that they feared for their lives when crossing the river because they did not know how to swim. One stated that he was swept away by the river’s current and was able to grab and hold onto a tree branch until his rescue.
Sewer tubes between the United States and Mexico have grates to prevent individuals from illegally entering the United States. During heavy rain, the grates are opened to let water flow through the sewer tubes without damaging the grates. Due to heavy rain that was occurring in the area at the time, the grates were open and Campos used the opportunity to smuggle the unauthorized immigrants into the United States.
Court documents established Campos agreed to guide the group in the January event, and in exchange he would have his own smuggling fee reduced to $6,000. Campos also admitted that he has been working for smugglers by building ladders to smuggle people across the U.S.-Mexico border fence.
“This case is yet another example of transnational smuggling organizations placing profits over safety,” said U.S. Attorney Tara McGrath. “Thankfully, due to law enforcement intervention and the assistance of local lifeguards, all lives were spared.”
“This is an important reminder that safety is of little concern to transnational criminal organizations,” said Chief Patrol Agent Patricia McGurk-Daniel. “U.S. Border Patrol agents will continue to target human smugglers and deliver consequences to those who violate the laws of our nation.”
This case is being prosecuted by Assistant U.S. Attorney Jessica Adeline Schulberg.
DEFENDANT Case Number 24CR0290-LL
Kevin Noe Campos Villa Age: 20 Tijuana, Mexico
SUMMARY OF CHARGES
Title 8, United States Code, §1324(a)(1)(A)(i) – Bringing in Illegal Aliens at a Place other than a Designated Port of Entry
Maximum penalty: Ten years in prison; $250,000 fine
AGENCY
United States Border Patrol
San Diego Lifeguards
Shipyard Contractor Pleads Guilty to Stealing Nearly $600,000 Worth of Computer Equipment from the U.S. NavyRead the Press Release
NEWS RELEASE SUMMARY – March 19, 2024
SAN DIEGO – Ernesto Saldivar, a civilian contractor at General Dynamics NASSCO who was part of the shipyards’ modernization efforts, pleaded guilty today to stealing nearly $600,000 worth of computer equipment from three U.S. Navy ships.
According to Saldivar’s plea agreement, from November 2022 to August 2023, he stole hundreds of items, such as hard drives and laptops, from declassified areas on ships undergoing maintenance. Saldivar was selling the stolen items, including two hard drives containing military communications, on eBay. The affected ships included the USS Pinckney, USS Curtis Wilbur and USS Spruance.
Saldivar admitted in his plea agreement that the total aggregate value of the stolen items was $596,997.53, almost all of which he will owe the United States government in restitution. The defendant also admitted to receiving $2,584.98 in payments from eBay sales of the stolen items.
“Stealing from our military doesn’t just hurt the taxpayer, it puts our national security and service members at risk,” said U.S. Attorney Tara McGrath. “The military relies heavily on civilian support, and we will do our part to ensure our service members can trust the civilians standing by their side.”
This case is being prosecuted by Assistant U.S. Attorneys Sarah Goldwasser and Michelle Wasserman.
DEFENDANT Case Number 24CR532-JAH
Ernesto Saldivar Age: 30 San Diego, CA
SUMMARY OF CHARGES
Theft of Government Property – Title 18, U.S.C., Section 641
Maximum penalty: Ten years in prison and $250,000 fine
INVESTIGATING AGENCY
Naval Criminal Investigative Service
If you have information regarding fraud, waste, or abuse relating to Department of Defense personnel or operations, please contact the DoD Hotline at 800-424-9098.
GirlsDoPorn Owner Michael Pratt Extradited to Face Sex Trafficking ChargesRead the Press Release
SAN DIEGO – Michael Pratt, the alleged mastermind behind the GirlsDoPorn commercial sex trafficking ring, made his first appearance in federal court today following his extradition from Spain Monday night.
Pratt, who was the owner of the website GirlsDoPorn, was charged in October 2019 in the Southern District of California with sex trafficking crimes in connection with a scheme to deceive and coerce young women to appear in pornographic videos. Pratt was an international fugitive for more than three years before he was arrested in Spain in December 2022. Earlier in 2022, he was named to the FBI’s Top Ten Most Wanted list.
At today’s hearing, Pratt was arraigned and entered a not-guilty plea before U.S. Magistrate Judge Daniel E. Butcher. A detention hearing is scheduled for March 21 at 3 p.m. before Judge Butcher, followed by a motion hearing/trial setting on April 19 at 1:30 p.m. before U.S. District Judge Janis L. Sammartino.
“We cast a wide net in search of Mr. Pratt and now that he is in San Diego, we are prepared to bring him to justice,” said U.S. Attorney Tara K. McGrath. “We extend our deep appreciation to the government of Spain for its assistance in securing his arrest and extradition.”
“Michael Pratt’s initial appearance in San Diego is tangible proof that the pursuit of justice never stops, regardless of length of time or location,” said FBI San Diego Special Agent in Charge, Stacey Moy. “Pratt’s arrest and extradition back to the United States reflects a great collaboration among multiple agencies, both in the United States and Spain who were dedicated to seeking justice for the young women he allegedly victimized. This large, internationally coordinated effort could not have been successful without support from our law enforcement partners in Spain, the U.S. Marshals Service, U.S. Department of Justice, and Immigration and Customs Enforcement.”
According to public court filings, Pratt and his co-defendants used force, fraud, and coercion to recruit hundreds of young adult women – most in their late teens – and at least one minor victim, to appear in GirlsDoPorn videos.
Pratt is accused of recruiting the victims from throughout the United States and Canada using internet advertisements for clothed modeling jobs. Even after the victims were told the gig involved an adult video-shoot, Pratt and his co-defendants convinced the women that their videos would be provided solely to private collectors on DVD in foreign countries, that they would remain anonymous, and that the videos would not be posted on the internet – assurances that Pratt and his co-defendants knew to be false.
Most of the video shoots took place in San Diego – at local hotels and short-term rental units. Although the women were promised that the video shoots would be brief, they often took hours. Once the video productions began, some women were not permitted to leave the shooting locations until the videos were completed; some were threatened with lawsuits or cancelled flights home if they did not complete the videos; and others were allegedly forced to perform certain sex acts, which they had earlier declined to do.
After the victims returned home, still believing that they would remain anonymous, Pratt and his co-defendants posted clips of the videos on heavily trafficked adult film sites, like Pornhub, to funnel traffic to the full-length versions of the videos on his website, GirlsDoPorn. Pratt charged visitors to GirlsDoPorn a subscription fee. The site generated more than $17 million in revenue for Pratt.
Pratt faces 19 felony counts stemming from the operation of GirlsDoPorn. The charges include:
• Fifteen counts of sex trafficking by force, fraud, and coercion;
• Conspiracy to commit sex trafficking by force, fraud, and coercion;
• Production of child pornography;
• Sex trafficking of a minor by force, fraud, and coercion; and
• Conspiracy to commit money laundering.
The U.S. Attorney’s Office in the Southern District of California recognizes the outstanding efforts of the FBI in San Diego; the FBI Legal Attaché in Spain; the U.S. Marshals Service; Spain’s Ministry of Justice; and law enforcement officials in Spain and Portugal; as well as the Justice Department’s Office of International Affairs, for their substantial assistance in securing the arrest and extradition of Pratt.
DEFENDANTS Case Number 19cr4488
Michael James Pratt Age: 36 Unknown
Matthew Isaac Wolfe Age 37 San Diego, CA
Ruben Andre Garcia Age: 31 San Diego, CA
Theodore Gyi Age, 46 Solana Beach, CA
Valorie Moser Age: 37 San Diego, CA
SUMMARY OF CHARGES IN SUPERSEDING INDICTMENT
Count 1
Conspiracy to Commit Sex Trafficking by Force, Fraud and Coercion, 18 U.S.C. § 1594
Maximum Penalty: Life in prison, $250,000 fine.
Counts 2-16
Sex Trafficking by Force, Fraud and Coercion 18 U.S.C. §1591(a) and (b)(1)
Minimum penalty: Fifteen years in prison; Maximum penalty: life in custody, $250,000 fine.
Count 17
Production of Child Pornography, 18 U.S.C. § 2251(a) and (e)
Minimum penalty: Fifteen years in prison; Maximum penalty: thirty years in prison, $250,000 fine.
Count 18
Sex Trafficking of a Minor and By Force, Fraud and Coercion, 18 U.S.C. § 1591(a)(1), (a)(2), and (c)
Minimum penalty: Fifteen years in prison; Maximum penalty: life in custody, $250,000 fine.
Count 19
Conspiracy to Launder Monetary Instruments, 18 U.S.C. § 1956(a)(1)(A)(i) and 1956(h).
Civil penalty of the greater of (A) the value of the property, fund or monetary instruments involved in the transaction or (B) $10,000
INVESTIGATING AGENCIES
FBI – Southern District of California and Legal Attaché in Spain
U.S. Marshals Service
U.S. Department of Justice, Office of International Affairs
Spanish National Police
Spain’s Ministry of Justice
Spain’s Ministry of Interior
*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
Friend and Business Partner of GirlsDoPorn Owner Michael Pratt Sentenced to 14 Years in PrisonRead the Press Release
NEWS RELEASE SUMMARY – March 19, 2024
SAN DIEGO – Matthew Isaac Wolfe was sentenced in federal court today to 14 years in prison for his role in a conspiracy with Michael Pratt, owner of the website GirlsDoPorn, and others, to deceive and coerce young women into appearing in pornographic videos. A restitution hearing is scheduled for May 7, 2024 at 10 a.m.
The conspiracy included recruiting the victims from throughout the United States and Canada using internet advertisements for clothed modeling jobs. Even after the victims learned the gig involved an adult video-shoot, Wolfe admitted to persuading women to appear in the videos by telling them that the videos would never be posted online, 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 he knew to be false. In truth, the videos were exclusively marketed and distributed on the internet. Not only did Wolfe lie to the women, he also instructed others to do so. Wolfe told co-defendant Theodore Gyi, the cameraman on hundreds of GirlsDoPorn video shoots, that if asked, he should lie to the women and tell them the videos would not be posted on the internet.
Most of the video shoots took place in San Diego – at local hotels and short-term rental units. Although the women were promised that the video shoots would be brief, they often took hours. Once the video productions began, some women were not permitted to leave the shooting locations until the videos were completed; some were threatened with lawsuits or cancelled flights home if they did not complete the videos; and others were allegedly forced to perform certain sex acts, which they had earlier declined to do.
After the victims returned home, still believing that they would remain anonymous, clips of the videos were posted on heavily trafficked adult film sites, like Pornhub, meant to funnel viewers to the full-length versions of the videos on Pratt’s website, GirlsDoPorn. Pratt charged visitors to GirlsDoPorn a subscription fee and generated more than $17 million in revenue.
Wolfe pleaded guilty to the conspiracy on July 26, 2022, admitting he moved to the United States from New Zealand in 2011 to work for Pratt and had a wide range of responsibilities. He filmed approximately 100 videos; uploaded finished videos onto the internet; oversaw the company’s financial books; and operated various business entities that were used to promote the business. Wolfe worked at GirlsDoPorn from 2011 until his arrest in October 2019.
During hearings today and on January 22, 2024, approximately 30 survivors asked a federal judge to impose a significant sentence, describing how the actions of Wolfe and his co-defendants destroyed their lives. Survivors, many of them college students at the time, described answering what they thought were legitimate modeling ads and flying to San Diego for paid modeling gigs, only to be forced to perform sexual acts on camera.
The women spoke of struggling with substance and alcohol abuse, anxiety and depression, suicidal thoughts and attempts, and post-traumatic stress syndrome in the aftermath of their videos going viral. Some spoke of lost relationships with friends and family; others dropped out of school; and others went into hiding.
One of the women said: “I was robbed of my privacy, my dignity, and my peace of mind… But worst of all, I was robbed of my identity. I was once viewed as a beautiful, fun-loving and strong woman who was known for her athleticism and ability to make just about anyone laugh. I was a caring friend and a daughter my parents were proud of. Mr. Wolfe shattered who I was…Today I'm taking my identity back. I am not a victim. I'm a survivor.”
One woman recalled the day she learned that her pornographic video received more than 300 million views on Pornhub, one of the most-visited websites in the world.
“That ad seemed harmless, but it wrecked my entire life. In an instant, the life I had was gone: My hopes gone, my relationships gone, everything was gone…The fall-out from the videos spread to every part of my life like cancer, and that cancer remains to this day, making it virtually impossible for me to start a new life. I lost my modeling career, my college years, my whole twenties, my name, my career path, my friends, and my family. Everything I had built was gone, and so too was my future. Doors that were once opened were slammed in my face…Matthew Wolfe stole my life, and it wasn't just my life. He stole hundreds of lives. What kind of price do you put on a life? Mr. Wolfe deserves a jail sentence that accounts for each and every life he has stolen.”
Another woman told the court: “It's been nearly 3,650 days of living in a tortuous purgatory, but today marks a major milestone in my recovery. Today there's a shift in the winds. Today is the day all the survivors get their voices back. Today is the day we get to be heard.”
Wolfe also admitted he was aware that personal identifying information and social media accounts for some women were being posted on pornwikileaks.com, a site controlled by Pratt and dedicated to “exposing” the true identities of individuals appearing in pornographic videos, causing the victims to be subjected to severe harassment. Even after Wolfe became aware of this, he and others continued to assure prospective models that no one would ever find out about their video shoot or learn their identity.
“We applaud all survivors who courageously speak out in pursuit of justice,” said U.S. Attorney Tara McGrath. “Their voices rang out in the courtroom today, and we stand beside them in holding Mr. Wolfe accountable for the incredible pain and suffering he caused.”
“Matthew Wolfe’s willingness to use deception, coercion and intimidation to exploit young women paints a sordid picture of the lengths some people will go just to make money,” said FBI San Diego Special Agent in Charge Stacey Moy. “Wolfe’s sentencing today, and any past or future sentencings related to this case, are small slivers of justice for the victims, but ultimately don’t fully heal the deep pain spawned by Mr. Wolfe and the other defendants.”
Co-defendant Michael Pratt made his first appearance today after being extradited from Spain following more than three years as an international fugitive. In 2022, Pratt was named to the FBI’s Top Ten Most Wanted list.
Ruben Andre Garcia, the recruiter and male model, was sentenced to 20 years in prison on June 14, 2021. Theodore Gyi was sentenced to four years in prison on November 9, 2022. Valorie Moser, the office manager, is set for sentencing on August 9, 2024.
DEFENDANTS Case Number 19cr4488
Michael James Pratt Age: 36 Unknown
Matthew Isaac Wolfe Age 37 San Diego, CA
Ruben Andre Garcia Age: 31 San Diego, CA
Theodore Gyi Age, 46 Solana Beach, CA
Valorie Moser Age: 37 San Diego, CA
CHARGES
Count 1
Conspiracy to Commit Sex Trafficking by Force, Fraud and Coercion, 18 U.S.C. § 1594
Maximum Penalty: Life in prison, $250,000 fine.
INVESTIGATING AGENCIES
FBI – Southern District of California
U.S. Marshals 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.
Man Sentenced to 40 months in prison for Stealing Chief Federal Judge’s Identity and Forging Court DocumentsRead the Press Release
Honolulu, Hawaii – Edmond Abordo of Honolulu was sentenced in federal court today to 40 months for forging the signature of a federal judge in order to trick an elderly woman into paying him thousands of dollars for bogus legal services.
The United States Attorney’s Office for the Southern District of California handled this case after the United States Attorney’s Office for the District of Hawaii was recused.
In November of 2023, Abordo was in the second day of his federal jury trial when he decided to plead guilty to forging the signature of the Chief Judge and using the seal of the United States District Court for the District of Hawaii to create a phony court order. Abordo then used the forged court order to convince the victim that he had used his legal expertise to prevent the foreclosure of her Ewa Beach, Hawaii home.
When Abordo first met the victim, he described himself to her as a “non-licensed attorney” who could help save her home. Abordo—who is not a lawyer and has no legal training—claimed he had expertise on several legal subjects, including mortgages and adverse possession. He convinced the victim to file a federal lawsuit challenging foreclosure of her home. Nearly each time Abordo met with the victim, he demanded a cash payment of $1,000 to $3,000 dollars.
According to the indictment, Abordo ultimately convinced the victim that the federal judge assigned to the lawsuit had awarded her possession of the home, but refused to hand over the court order unless she paid him additional money. In reality, the victim’s home had been lost to foreclosure and the federal lawsuit had been dismissed months earlier. The victim, believing Abordo had a real court order, paid him thousands of dollars in exchange for the forged court order.
Abordo assured the victim that the forged court order was a genuine court document, that the federal judge’s signature on the forged order was genuine, and that the forged court order gave legal possession of the Ewa Beach property to the elderly victim. However, as Abordo then well knew, the forged court order was not genuine, was never issued or signed by the judge, and did not confer any property rights to the victim.
During the hearing, Chief District Court Judge Derrick Watson told the sentencing judge that “nothing is as important to our society as the rule of law. Mr. Abordo’s crimes caused great damage to the integrity of the courts.”
“This defendant had the audacity to not just swindle an elderly victim in the midst of foreclosure, but to forge the signature of a federal judge,” said U.S. Attorney Tara McGrath of the Southern District of California, whose office is handling the recusal case. “The Department of Justice is committed to protecting the integrity of our judicial system.”
“The FBI finds it extremely disconcerting that the defendant preyed on an especially vulnerable kupuna going through personal financial distress involving the loss of their home,” said FBI Special Agent in Charge Steven Merrill. “This sentence shows that we will vigorously and thoroughly investigate cases that target our elderly community. We encourage the public to bring these to our attention by reporting it to ic3.gov.”
DEFENDANT Case Number 22cr00101-BLW-KJN
Edmund Abordo 68 Honolulu, HI
SUMMARY OF CHARGES
Wire Fraud – Title 18 U.S.C., Section 1343
Maximum Penalty: Twenty years in prison, $250,000 fine, forfeiture and restitution
Aggravated Identity Theft – Title 18 U.S.C., Section 1028A(a)(1)
Maximum Penalty: A mandatory minimum of two years in prison, consecutive to underlying count
AGENCIES
Federal Bureau of Investigation
Father and Son Duo Sentenced to Prison in $21 Million Dollar Medicare SchemeRead the Press Release
NEWS RELEASE SUMMARY – March 11, 2024
SAN DIEGO – Anthony Duane Bell Sr. and his son, Anthony Duane Bell Jr., were sentenced in federal court today to 65 months and 12 months and one day, respectively, for their roles in fraudulently receiving more than $21 million in Medicare payments and lying to cover it up.
The pair, along with others, conspired to commit Medicare fraud by billing for medically-unnecessary durable medical equipment such as knee, ankle, shoulder, wrist and back braces. Bell Sr. pleaded guilty to Medicare fraud while Bell Jr. pleaded guilty to making false statements to a federal officer.
U.S. District Court Judge William Q. Hayes also ordered Bell Sr. to pay $21,725,604.56 in restitution to Medicare and forfeit $806,375.12 and a luxury house in El Cajon. The forfeited property was purchased using money obtained from the fraud. In arriving at the sentence, Judge Hayes found that Bell Sr. intended to defraud Medicare of over $46 million dollars and received over $21 million dollars.
“This brazen scheme exploited elderly and disabled Medicare beneficiaries so these defendants could line their own pockets,” said U.S. Attorney Tara K. McGrath. “Together with our law enforcement partners, this office will continue to vigorously investigate and prosecute fraud that diverts Medicare funds from some of our nation’s most vulnerable citizens.”
“Those who game the system to take advantage of federal health care programs for personal financial gain do so at the expense of those who rely on these programs and American taxpayers,” said Special Agent in Charge Timothy B. DeFrancesca of the Department of Health and Human Services Office of the Inspector General (HHS-OIG). “Together with our law enforcement partners, HHS-OIG will continue working diligently to hold these individuals accountable.”
“The Bells using their business as a front to defraud the U.S. government and Medicare program is unacceptable,” said FBI San Diego Acting Special Agent in Charge Tom Ryan. “The FBI and its law enforcement partners will continue to dedicate their resources to make sure individuals who try to illegally profit from the U.S. government will be prosecuted.”
According to court records, the Bells created companies known as Universal Medical Solutions 1 and Universal Medical Solutions 2, which supplied durable medical equipment. In order to find customers for their businesses, the Bells entered into sham agreements with “marketing” companies that, instead of marketing, provided packets of information about Medicare beneficiaries for $125 to $350 each. These packets of information included a Medicare beneficiary’s personal information, medical history, Medicare number, and an audio recording between a call center and the patient, in which the patient supposedly agreed to accept a brace. The packet also included a signed prescription from a doctor, obtained via telemedicine, claiming that the brace was medically necessary for the patient – although in almost all cases the prescription was signed by a physician who had no previous doctor-patient relationship with the patient, was often in another state, and at most had conducted an audio call with the patient. In all cases the doctor had not conducted any kind of physical examination of the patient.
The Bells bought thousands of these patient packets, each time indirectly paying the telemedicine doctors through the “marketing” companies. The packets were referred to in the industry as “Doctor’s Orders” or “D.O.s.” The Bells purchased the “D.O.s” for a variety of braces, paying the most (up to $350) for a back brace prescription, the type of medical equipment for which Medicare offered the highest reimbursement. The Bells could then, after shipping the brace to the patient, bill Medicare around $1,359.89 for each back brace, through their companies. The Bells also bought other braces, including wrist, knee, and shoulder braces, and billed Medicare at much higher prices than they paid for them.
When Bell Jr. was interviewed by the FBI, he lied about his knowledge of the scheme.
The case is being prosecuted by Assistant U.S. Attorneys Valerie H. Chu and Christopher M. Alexander of the Southern District of California.
DEFENDANTS Criminal Case No. 20CR2887-WQ
Anthony Duane Bell Sr. Age: 55 El Cajon, California
Anthony Duane Bell Jr. Age: 33 El Cajon, California
SUMMARY OF CHARGE
Health Care Fraud, a felony, in violation of Title 18, United States Code, Section 1347.
Maximum Penalty: Ten years in custody; a fine of $250,000; a mandatory special assessment of $100; an order of restitution; and a three-year term of supervised release.
False Statement, a felony, in violation of Title 18, United States Code, Section 1001.
Maximum Penalty: Five years in custody; a fine of $250,000; a mandatory special assessment of $100; an order of restitution; and a three-year term of supervised release.
INVESTIGATING AGENCIES
Federal Bureau of Investigation
Department of Health and Human Services, Office of Inspector General
United States Marshal’s Service
Former Navy Civilian Employee and Former Executive Indicted in Bribery Scheme Involving over $100 Million in Government ContractsRead the Press Release
NEWS RELEASE SUMMARY – March 7, 2024
SAN DIEGO – A former civilian employee of San Diego-based Naval Information Warfare Center and a former executive with a South Carolina defense contractor were charged in an indictment unsealed today with participating in a bribery scheme to trade expensive meals, jobs and a ticket to a premiere sporting event for help obtaining more than $100 million in government contracts.
According to the indictment, James Soriano, of Las Vegas, Nevada, worked for the Naval Information Warfare Center, which provided contract administration services for the Navy. From 2006 to 2019, Soriano was an engineer, project leader and certified “Contracting Officer Representative” with technological expertise to help manage Department of Defense contracts. Soriano was supposed to act as liaison between the government and the contractor, including keeping contractor bid, proposal and selection information confidential, and protecting the integrity of the acquisition process by maintaining fairness in the government’s treatment of all bidders.
According to the indictment, Soriano instead used his considerable influence to steer lucrative contracts to Russell Thurston of Mt. Pleasant, South Carolina, who was an executive vice president of a company vying for defense contracts with locations in Arlington, Virginia, and Charleston, South Carolina. The company provided technical and consulting services in the information technology field.
The indictment said Thurston, and others working under him, gave Soriano various things of value including jobs for a family member and friends, free meals at various restaurants, as well as a ticket to the 2018 MLB All Star Game held at Nationals Park in Washington, D.C. One of the friends who was given a job at Soriano’s request gave Soriano half her salary every month—approximately $2,000 per month—in cash. The indictment indicates the friend was not actually performing the duties for which she was being paid.
In return, Soriano took official action to benefit the company, including allowing Thurston and other employees to draft procurement documents for various contracting efforts, even where the company was competing for the contract against other bidders. As a result of Soriano’s efforts, the company won a task order with a more than $300 million ceiling. Soriano then approved numerous projects on this task order, ultimately causing the government to obligate more than $100 million to the company.
To conceal their activities, Thurston, Soriano, and other employees at the company would intentionally delete document properties on procurement documents drafted by employees. Soriano also failed to disclose the gifts on his yearly required OGE Form 450.
“This indictment reveals callous greed at the cost of taxpayer dollars,” said U.S. Attorney Tara McGrath. “This office will vigorously investigate and prosecute fraud that threatens public trust in our institutions.”
“The indictment of James Soriano and Russell Thurston should be a deterrent for individuals and companies contemplating or attempting to misuse positions of public trust in order to enrich themselves financially or ensure future lucrative contracts,” said Bryan D. Denny, Special Agent-in-Charge for the Department of Defense Office of Inspector General, Defense Criminal Investigative Service, Western Field Office. “The alleged actions subvert the integrity of the government’s acquisition process, waste taxpayers’ money, and ultimately degrade the readiness of America’s warfighters.”
“The DoD contracting process ensures our taxpayer dollars are spent appropriately to equip our warfighters with the tools necessary to fight and win in an ever-increasingly complex environment. Attempts to undermine that process ultimately put our warfighters at risk,” said Special Agent in Charge Tyler Hatcher, IRS Criminal Investigation. “This most recent indictment against Mr. Soriano and Mr. Thurston is demonstrative of IRS Criminal Investigation’s relentless commitment to supporting national security through partnering on corruption investigations while continuing to pursue those who intentionally evade paying their fair share in taxes, whether their income is legally or illegally obtained.”
“Using a position of public trust as a means to fraudulently grant access to federal programs for personal gain will not be tolerated,” said SBA OIG’s Western Region Special Agent in Charge Weston King. “Our Office will remain relentless in the pursuit of fraudsters who seek to exploit SBA’s vital economic programs. I want to thank the U.S. Attorney’s Office and our law enforcement partners for their dedication and commitment to seeing justice served.”
Soriano is also charged with three counts of filing false tax returns as result of failing to declare the cash that he was receiving from his friend as income.
DEFENDANTS Case Number 24cr0341-TWR
James Soriano Age: 63 Las Vegas, NV
Russell Thurston Age: 51 Mt. Pleasant, SC
SUMMARY OF CHARGES
Conspiracy to Commit Bribery - Title 18, U.S.C., Section 371
Maximum penalty: Five years in prison; $250,000 fine
Bribery – Title 18, U.S.C., Section 201
Maximum penalty: Fifteen years in prison; $250,000 fine for an individual or $500,000 for an organization, or three times the monetary equivalent of the thing of value, whichever is greater.
Fraud and False Statement in Tax Return – Title 26, U.S.C., Section 7206(1)
Maximum penalty: Three years in prison; $100,000 fine
INVESTIGATING AGENCIES
Defense Criminal Investigative Service
Naval Criminal Investigative Service
Small Business Administration – Office of Inspector General
IRS Criminal Investigation
Department of Health and Human Services – Office of Inspector General
*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
If you have information regarding fraud, waste, or abuse relating to Department of Defense personnel or operations, please contact the DoD Hotline at 800-424-9098.
Two Men Charged with Murdering Witnesses and Burying Their Remains to Thwart Investigation of Drug Trafficking OrganizationRead the Press Release
NEWS RELEASE SUMMARY – March 5, 2024
SAN DIEGO – A superseding indictment was partially unsealed in the Southern District of California today charging Benjamin Madrigal-Birrueta, an alleged drug trafficker, with murdering two people to prevent them from testifying in drug trafficking prosecutions that were pending in federal court in San Diego.
The victims were identified as Cesar Armando Murillo, 44, and Maira Sofia Hernandez, 33, residents of Yakima, Washington. Court filings indicate Hernandez was six-months pregnant when she was killed, and the superseding indictment includes a separate count charging Madrigal-Birrueta with the death of her in utero child.
“These executions were an assault on our justice system, designed to silence witnesses and instill fear,” said U.S. Attorney Tara McGrath. “The obligation to protect witnesses is paramount and the United States will fully prosecute intimidation and violence designed to interfere with the justice system.”
“The cartels and drug trafficking organizations have reached beyond our borders, bringing their criminality to every city and small town in our interior,” said Special Agent in Charge Robert Hammer, who oversees HSI operations in the Pacific Northwest. “The murder of witnesses is an afront to our rule of law but HSI, along with our law enforcement partners, have the resources to uncover these horrible crimes and the dedication to dismantle the organizations harming our population, wherever they may be located.”
“HSI continues to tirelessly investigate criminal organizations who traffic dangerous drugs across our border and into the interior of the United States. In this pursuit we will ensure that anyone who is responsible for causing harm to a witness in one of our investigations is held accountable for these actions,” said HSI San Diego SAC Chad Plantz. “Fear or harm caused to those who report a crime or testify diminishes the public’s trust in the criminal justice system and erodes the foundation of the rule of law. HSI and its partners are committed to ensuring that anyone who tampers with witnesses or breaks the laws in place to protect them are brought to justice.”
The superseding indictment also charges Ricardo Orizaba with being an accessory after the fact to murder. Court filings indicate both victims were buried in a remote high-desert location near Yakima and that these charges follow a year-long search culminating in the discovery of their remains in September 2023. Hernandez is survived by her three minor children and Murillo is survived by two minor children.
The superseding indictment alleges Defendant Madrigal-Birrueta was a leader in a criminal enterprise that committed a series of felony violations of federal drug laws. According to court filings, the investigation originated with the seizure of drugs from vehicles using San Diego area ports of entry between August and October of 2021. The organization used late model stolen vehicles to smuggle drugs. The superseding indictment alleges that Madrigal-Birrueta is responsible for the importation of those drugs.
According to court filings, by August of 2022, the investigation led agents to a group of individuals operating out of Yakima. Special Agents with Homeland Security Investigations interviewed Murillo and Hernandez, and within days of those interviews, Murillo and Hernandez were murdered and their bodies were buried in the high desert. Court filings describe how these charges follow an exhaustive, year-long investigation that employed geophysicists, ground penetrating radar, aircraft, laser imaging, chemical testing of the soil, numerous cadaver dogs, and other law enforcement techniques to search for the victims’ remains. HSI Special Agents successfully recovered the remains on September 13, 2023, aided by a Washington State Police Crime Scene Investigations team.
Special Agents with Homeland Security Investigations working with Washington State Police to exhume remains on September 13, 2023.
Court filings further indicate that, based on autopsy reports, both victims died of multiple gunshot wounds to the head.
During the investigation agents seized methamphetamine, cocaine, fentanyl, multiple firearms — including a machine gun — and body armor from Madrigal-Birrueta’s drug trafficking organization. In addition to the homicides, the superseding indictment charges Madrigal-Birrueta with possessing a machine gun in furtherance of a drug trafficking crime.
Federal courts in California and Washington state have ordered that Madrigal-Birrueta and Orizaba be detained pending trial, and both are in custody.
Weapons seized during the investigation on September 8, 2022.
This case is being prosecuted by Assistant U.S. Attorneys Stephen H. Wong and Alicia P. Williams.
DEFENDANTS Case Number 23cr1684-RBM
Benjamin Madrigal-Birrueta Age: 22 Yakima, WA
Ricardo Orizaba Age: 21 Yakima, WA
SUMMARY OF CHARGES
Count 1:
Continuing Criminal Enterprise – Title 21, United States Code, Sections 848(a) and (b)(2)
Maximum penalty: Mandatory minimum twenty years and up to life in prison, $2 million fine
Count 2:
Conspiracy to Distribute Controlled Substances – Title 21, United States Code, Sections 841 and 846
Maximum penalty: Mandatory minimum ten years and up to life in prison, $2 million fine
Count 3:
Conspiracy to Import Controlled Substances – Title 21, United States Code, Sections 952, 960 and 963
Maximum penalty: Mandatory minimum ten years and up to life in prison, $2 million fine
Count 4:
Murder of Cesar Armando Murillo in Furtherance of a Drug Trafficking Conspiracy – Title 21, United States Code, Section 848(e)
Maximum penalty: Mandatory minimum sentence of twenty years and up to life, or death
Count 5:
Murder of Maira Sophia Hernandez in Furtherance of a Drug Trafficking Conspiracy – Title 21, United States Code, Section 848(e)
Maximum penalty: Mandatory minimum twenty years and up to life, or death
Count 6:
Conspiracy to Commit Witness Tampering: First Degree Murder – Title 18, United States Code, Sections 1512(a)(1)(A), (c), (2)(A), (3)(A), (c), (k), and 1111
Maximum penalty: Mandatory minimum term of life in prison or death, $250,000 fine
Count 7:
Witness Tampering: First Degree Murder of Cesar Armando Murillo – Title 18, United States Code, Sections 1512(a)(1)(A), (c), (3)(A), (c), (3)(A), and 1111
Maximum penalty: Mandatory minimum term of life in prison or death, $250,000 fine
Count 8:
Witness Tampering: First Degree Murder of Maira Sophia Hernandez – Title 18, United States Code, Sections 1512(a)(1)(A), (c), (3)(A), (c), (3)(A), and 1111
Maximum penalty: Mandatory minimum life in prison or death, $250,000 fine
Count 9:
Causing the Death of a Child in Utero – Title 18, United States Code, Sections 1841 and 1111.
Maximum penalty: Mandatory minimum life in prison or death, $250,000 fine
Count 10:
Witness Tampering: Threat of Force – Title 18, United States Code, Sections 1512(a)(2)(A), (C), (3)(A), and 1111
Maximum penalty: Up to twenty years in prison, $250,000 fine
Count 11:
Accessory After the Fact to Murder – Title 18 United States Code, Sections 3 and 1512(a)(1)(A) and Title 21, United States Code, Section 848(e), $250,000 fine
Count 12:
Possession, Brandishing, and Discharge of a Firearm in Furtherance of a Drug Trafficking Crime and a Crime of Violence – Title 18, United States Code, Sections 924(c)(1)(A)(iii) and 2, $250,000 fine
Count 13:
Possession and Brandishing of a Firearm in Furtherance of a Drug Trafficking Crime and a Crime of Violence – Title 18, United States Code, Sections 924(c)(1)(A)(iii) and 2, $250,000 fine
Count 14:
Possession, Brandishing, and Discharge of a Firearm in Furtherance of a Drug Trafficking Crime and a Crime of Violence – Title 18, United States Code, Sections 924(c)(1)(A)(iii) and 2, $250,000 fine
Count 15:
Possession of a Firearm in Furtherance of a Drug Trafficking Crime – Title 18, United States Code, Sections 924(c)(1)(A)(iii) and 2, $250,000 fine
Count 16:
Possession of a Machine Gun in Furtherance of a Drug Trafficking Crime – Title 18, United States Code, Sections 924(c)(1)(A)(i), (B)(ii), and 2 and Title 26, United States Code, Section 5845(b), $250,000 fine
Count 17:
Conspiracy to Commit Money Laundering – Title 18, United States Code, Section 1956(a)(1)(A)(i) and (h), $250,000 fine
AGENCIES
Homeland Security Investigations
Drug Enforcement Administration
Federal Bureau of Investigation
Bureau of Alcohol, Tobacco, Firearms and Explosives
Washington State Police
California Highway Patrol
Yakima Police Department
Tulare County Sheriff’s Office
Visalia Police Department
Fresno Sheriff’s Office
Fresno Police Department
*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
San Diego Man is First in Nation to be Charged with Smuggling Potent Greenhouse Gases into the United StatesRead the Press Release
NEWS RELEASE SUMMARY – March 4, 2024
SAN DIEGO – Michael Hart of San Diego was arrested early today and charged with smuggling potent greenhouse gases into the United States from Mexico and then selling them for profit, in violation of regulations intended to curb the use of greenhouse gases and slow climate change. (Video short)
This is the first prosecution in the United States to include charges related to the American Innovation and Manufacturing Act of 2020 (AIM Act). The AIM Act prohibits the importation of hydrofluorocarbons (HFCs), commonly used as refrigerants, without allowances issued by the Environmental Protection Agency (EPA).
“This office is at the forefront of environmental prosecutions, and today is a significant milestone for our country,” said U.S. Attorney Tara McGrath. “This is the first time the Department of Justice is prosecuting someone for illegally importing greenhouse gases, and it will not be the last. We are using every means possible to protect our planet from the harm caused by toxic pollutants, including bringing criminal charges.”
“It is illegal to import certain refrigerants into the United States because of their documented and significantly greater contribution to climate change,” said Assistant Attorney General Todd Kim of the Justice Department’s Environment and Natural Resources Division. “We are committed to enforcing the AIM Act and other laws that seek to prevent environmental harm.”
“The illegal smuggling of hydrofluorocarbons, a highly potent greenhouse gas, undermines international efforts to combat climate change under the Kigali Amendment to the Montreal Protocol,” said David M. Uhlmann, EPA Assistant Administrator for the Office of Enforcement and Compliance Assurance. “Anyone who seeks to profit from illegal actions that worsen climate change must be held accountable. This arrest highlights the significance of EPA’s climate enforcement initiative and our efforts to prevent refrigerants that are climate super pollutants from illegally entering the United States.”
“This case and subsequent arrest is a great example of multiple agencies collaborating to arrest an individual who allegedly smuggled illegal goods into the U.S. that harm our environment,” said Chad Plantz, special agent in charge for HSI San Diego. “We remain committed to keep these dangerous toxins from depleting our ozone.”
Hart made his first appearance in federal court this afternoon. The defendant was arraigned and entered a not-guilty plea. His next hearing is before U.S. District Judge Jeffrey T. Miller for motion hearing/trial setting on March 25, 2024, at 11 a.m.
According to the EPA, HFCs are potent greenhouse gases that cause climate change and are used in applications such as refrigeration, air-conditioning, building insulation, fire extinguishing systems, and aerosols. The global warming potential (GWP) of an HFC can be hundreds to thousands of times more potent than carbon dioxide. The use of HFCs has been rapidly increasing worldwide due to the global phaseout of ozone-depleting substances (ODS) and increased demand for refrigeration and air conditioning.
The indictment alleges that Hart purchased refrigerants in Mexico and smuggled them into the United States in his vehicle, concealed under a tarp and tools. According to the indictment, Hart posted the refrigerants for sale on OfferUp, Facebook Marketplace and other sites, and sold them for a profit. In addition to greenhouse gases, the indictment alleges Hart imported HCFC 22, an ozone-depleting substance regulated under the Clean Air Act.
The Montreal Protocol on Substances that Deplete the Ozone Layer (“Montreal Protocol”) is a treaty adopted in 1987 and ratified by virtually every country. The Montreal Protocol required the gradual phase out of ozone depleting substances, with different timetables for developed countries like the United States, and developing countries like Mexico. In the United States, the Montreal Protocol was implemented in 1990 by an addition to the Clean Air Act, which covers Stratospheric Ozone Protection. That addition identified HCFC 22 as a regulated ozone depleting substance. Before 2020, EPA regulations that governed ozone-depleting substances made it illegal for anyone to import a regulated ozone-depleting substance in an amount exceeding that individual’s consumption allowance, subject to certain exceptions. On January 1, 2020, consumption allowances for HCFC 22 were eliminated and it became illegal to import HCFC 22 for any purpose other than for use in a process resulting in their transformation or their destruction.
The Kigali Amendment to the Montreal Protocol is another international agreement designed to phase down the production and consumption of greenhouse gases such as HFCs, which are commonly used alternatives to ozone-depleting substances and are already controlled under the Montreal Protocol. The Kigali Amendment seeks to phase down the production and consumption of HFCs by 80 to 85 percent by 2047. The AIM Act authorized the EPA to phase down the production and consumption of HFCs in a stepwise manner. As part of the AIM Act, Congress added an additional list of regulated substances, which include HFC 32, HFC-125, HFC-134, HFC-134a, HFC 143 and HFC 143a. Refrigerants marketed as HFC 404a, 407a, 407c and 410a contain these regulated substances. The listed HFCs are some of the most commonly used HFCs and all are saturated, meaning they have only a single bond between their atoms and therefore have longer atmospheric lifetimes. Beginning on January 1, 2022, EPA regulations prohibit any person from importing bulk regulated HFCs, except by expending, at the time of import, a consumption or application-specific allowance issued by the EPA. No person may sell or distribute, or offer for sale or distribution, any regulated HFC that was imported illegally.
This case is being prosecuted by Assistant U.S. Attorney Melanie K. Pierson and Department of Justice Environmental Crimes Section Senior Trial Attorney Stephen DaPonte.
DEFENDANT Case Number 24cr0383
Michael Hart Age: 58 San Diego, CA
SUMMARY OF CHARGES
Count 1
Conspiracy – Title 18, U.S.C., Section 371
Maximum penalty: Five years in prison and $250,000 fine
Counts 2-6
Importation Contrary to Law – Title 18, U.S.C., Section 545
Maximum penalty: Twenty years in prison and $250,000 fine
Counts 7-13
Sale of Merchandise Imported Contrary to Law – Title 18, U.S.C., Section 545
Maximum penalty: Twenty years in prison and $250,000 fine
Criminal Forfeiture – Title 18, U.S.C., Sections 545 and 982
INVESTIGATING AGENCIES
U.S. Environmental Protection Agency, Criminal Investigation Division;
Homeland Security Investigations
*The charges and allegations contained in an indictment are merely accusations, and the defendants are considered innocent unless and until proven guilty
San Diego Man Sentenced to 41 months for Bank, Tax Fraud SchemesRead the Press Release
NEWS RELEASE SUMMARY – March 1, 2024
SAN DIEGO – Alvin Pates of San Diego was sentenced in federal court today to 41 months in prison for participating in a scheme to deceive banks by using straw borrowers and bogus financial information to obtain loans.
According to his plea agreement, beginning as early as July 2014 and continuing through at least April 2020, Pates admitted that he used the names, social security numbers, and credit of the straw borrowers to obtain loans and lines of credit that primarily benefited Pates.
At Pates’ behest, straw borrowers submitted false documentation provided by Pates showing they earned six-figure annual incomes from shell companies operated by Pates. Pates provided the straw borrowers with addresses and phone numbers for the shell companies, where Pates or others acting at his direction confirmed the false employment and income information when contacted by the financial institutions. Pates himself sometimes contacted the banks, pretending to be the straw borrowers, in order to ensure the straw borrowers could pass the security questions asked by the lenders.
Pates acknowledged in his plea agreement that he funneled the majority of the loan proceeds through the bank accounts of one of his shell companies to use for his personal benefit. For example, Pates admitted to using the funds for numerous personal transactions, cash withdrawals, personal living expenses for himself and his family, and to make payments to other credit unions. According to sentencing documents, during six years of the scheme, Pates supported his lifestyle, which included a penthouse apartment, a Corvette, a Mercedes, and a BMW, solely with the proceeds of his fraudulent schemes. In the midst of the scheme, Pates sent a message to one of his assistants, stating that “money is raining.”
According to sentencing documents, Pates recruited many of the straw borrowers from his church. The church members trusted Pates because he possessed an outward façade of morality and wealth. The straw borrowers believed they were starting a business with Pates, and willingly gave Pates 90 percent of the fraudulent loan proceeds as what they thought was their capital contribution. Pates promised the borrowers that he and his company would make all the loan payments. Pates did make the initial loan payments, using funds obtained from other fraudulent loans, only to default on the loans a few months later, ruining the credit and finances of the straw borrowers. Most of the borrowers were unable to pay off the loans; some filed for bankruptcy as a result.
After a number of church members had been financially damaged, Pates began attending another church, continuing the scheme using the name “Al Noble.” At today’s hearing, Pates was ordered to pay restitution of $45,500 to one individual who repaid the fraudulent loans.
In addition to the bank fraud, Pates also admitted to assisting in the preparation of false tax returns for two taxpayers for the calendar year 2015. The tax return for one of the taxpayers falsely stated that the individual received “Other Income” in the amount of $538,462 and paid federal income taxes of $543,643, thus entitling him to a refund of $376,260. Pates supplied false Forms 1099 to the taxpayer to support the return and accompanied the taxpayer to the IRS to submit the false return. The Internal Revenue Service issued a refund check to the taxpayer for $376,260, which was ultimately returned to the IRS.
“This case is especially egregious because Mr. Pates didn’t just rely on the faith of his fellow churchgoers, he preyed on it,” said U.S. Attorney Tara McGrath. “But the direct victims are not the only ones who were hurt; we all pay a price for bank and tax fraud when those costs are passed on.”
“Mr. Pates defrauded not only multiple financial institutions, but also his fellow Americans through these criminal schemes, for which he will now be held accountable,” said Special Agent in Charge Tyler Hatcher, IRS Criminal Investigation, Los Angeles Field Office. “Following the money is our specialty and, especially when we combine our expertise with our federal partners, our investigations lead to convictions.”
“This arrest and sentencing are the culmination of hard work by numerous local, state, and federal law enforcement agencies over the course of several years. The Secret Service will continue to investigate and pursue justice against those criminal networks who target the citizens of Southern California,” said Jason Reynolds, Special Agent in Charge with the San Diego Field Office of the United States Secret Service.
This case was prosecuted by Assistant U.S. Attorneys Melanie K. Pierson and Loren G. Rene.
DEFENDANT Case Number 20CR2204-CAB
Alvin Pates Age: 54 San Diego, CA
a.k.a. Al Noble
SUMMARY OF CHARGES
Bank Fraud – Title 18, U.S.C., Sections 1344(1) and 2
Maximum penalty: Thirty years in prison, $1 million fine, forfeiture and restitution
Aiding and Advising Preparation of a False Tax Return—Title 26, U.S.C., Section 7206(2)
Maximum penalty: Three years in prison, $250,000 fine, forfeiture and restitution
AGENCIES
U.S. Secret Service
IRS Criminal Investigation
Husband and Wife Sentenced for Defrauding TRICARE and Medicare out of $75 MillionRead the Press Release
NEWS RELEASE SUMMARY – March 1, 2024
SAN DIEGO – Charles Ronald Green Jr. and his wife, Melinda Elizabeth Green, were sentenced in federal court today to 27 months each for fraudulently billing government healthcare programs more than $125 million for medically unnecessary treatments.
According to court filings, the Greens engaged in a scheme to defraud two major federal health care programs: TRICARE, the medical benefits program for military servicemembers and their families, and Medicare, the program that provides benefits to elderly or disabled Americans.
Chief U.S. District Judge Dana M. Sabraw also ordered $4.5 million in restitution to TRICARE and $69,915,909.69 to Medicare.
Between May 12, 2014, and June 29, 2015, the Greens conspired to submit false and fraudulent claims to TRICARE for expensive and medically unnecessary pain creams, scar creams and multi-vitamins (collectively, “compounded medications”), which were billed through various pharmacies. During this period, the Greens owned or were officers of several companies they used in furtherance of their scheme. The pharmacies paid these companies millions of dollars in illegal kickbacks and other remuneration in exchange for the referral of the false and fraudulent prescriptions for compounded medications to TRICARE beneficiaries.
In turn, the Greens and others paid a portion of their profits as kickbacks to so-called “marketing” organizations in exchange for more prescriptions for compounded medications. TRICARE and other payers often reimbursed compounding pharmacies thousands of dollars for a 30-day supply of a compounded pain or scar cream for one beneficiary. In just one example, on May 8, 2015, a false and fraudulent claim was submitted to TRICARE in the amount of $14,178 for Baclofen Powder.
In furtherance of the compounding fraud scheme, the Greens and others developed compounded medication formulations for the primary purpose of inflating the amount of money TRICARE would reimburse, and to correspondingly increase the amount of kickbacks and remuneration that affiliated marketers would receive.
The Greens’ knowing participation in the compounding fraud scheme resulted in the submission of false and fraudulent claims by one pharmacy in the approximate amount of $8,107,816, of which TRICARE paid at least $6,776,222.
Between June 1, 2018, and April 2019, the Greens also conspired to defraud Medicare by submitting false and fraudulent claims for expensive durable medical equipment, or “DME,” similarly induced through a system of illegal kickbacks. The Greens and others executed the DME fraud scheme by purchasing “completed doctors’ orders” from various “marketers” for Medicare beneficiaries, which included a prescription signed by a doctor certifying the beneficiary received an exam that met Medicare’s requirements and that the DME was medically necessary.
In an attempt to disguise the DME fraud scheme from detection, the Greens and their co-conspirators entered into sham “marketing” and other contracts that concealed the pay-per-order arrangement. For example, on March 14, 2019, Charles Ronald Green prepared and submitted an invoice from the Greens’ company, NHS Pharma, concealing that NHS Pharma was being paid a per-brace kickback for selling completed doctors’ orders, but claimed instead to be charging for a $35,000 “TV Campaign,” a quantity of 716 website “Landing Pages,” and $6,928.71 for processing hours.
In addition to purchasing doctors’ orders in furtherance of making false and fraudulent claims on behalf of DME companies they owned or controlled, in some instances the Greens brokered the doctors’ orders by re-selling them at a markup to other DME companies.
“Fraud schemes like this one drive up health care costs for everyone,” said U.S. Attorney Tara McGrath. “We will continue to investigate and bring to justice those who scam taxpayers and place their own financial interests ahead of patient care. Diverting resources from service members and the elderly is especially heinous.”
“The Greens’ greed cost American taxpayers tens of millions of dollars by defrauding federal healthcare programs, including the Department of Defense’s TRICARE program,” said Bryan D. Denny, Special Agent in Charge of the Department of Defense Office of Inspector General, Defense Criminal Investigative Service (DCIS), Western Field Office. “DCIS and its partners will always aggressively investigate those who conspire to defraud TRICARE, because those deceptive actions ultimately harm those defending our country and their families.”
“It is disheartening when people like the Greens go to great lengths to plan elaborate schemes that ultimately have negative effects on innocent citizens,” said FBI San Diego Special Agent in Charge Stacey Moy. “The FBI and its law enforcement partners will ensure that those who defraud the United States Government will be thoroughly investigated and prosecuted for their actions.”
The Court set a hearing for May 24, 2024, to resolve additional claims for restitution.
This case is being prosecuted by Assistant U.S. Attorney Valerie H. Chu.
DEFENDANTS Case Number 20cr1566-DMS
Melinda Elizabeth Green Age: 63 Windermere, FL
Charles Ronald Green, Jr. Age: 67 Windermere, FL
SUMMARY OF CHARGES
Conspiracy – Title 18, U.S.C., Section 371
Maximum penalty: Five years in prison and $250,000 fine
Health Care Fraud – Title 18, U.S.C., Section 1347
Maximum penalty: Ten years in prison and $250,000 fine
INVESTIGATING AGENCIES
Federal Bureau of Investigation
Health and Human Services Office of the Inspector General
Department of Defense Office of the Inspector General
Alleged Mastermind of $5 Million Unemployment Fraud Scheme Extradited from RomaniaRead the Press Release
NEWS RELEASE SUMMARY – February 23, 2024
SAN DIEGO – David Constantin, alleged mastermind of a scheme to steal more than $5 million in California unemployment benefits intended to help workers affected by the pandemic, appeared in federal court today following his extradition Monday to the United States from Romania.
At today’s hearing, U.S. Magistrate Judge Michael S. Berg ordered Constantin detained pending trial. The next hearing is scheduled for April 1, 2024, at 1:30 p.m. before U.S. District Judge Larry A. Burns.
Constantin was indicted by a federal grand jury in October 2023 along with 13 others. In addition to the four counts of wire fraud conspiracy and wire fraud charges, the indictment also alleges that Constantin transmitted more than $128,000 in fraud proceeds to associates in Romania.
Constantin was apprehended by Romanian authorities at the request of the United States on November 14, 2023. The United States also seized valuable assets connected to Constantin, and co-Defendants in this case, Eduard Buse (D6), and Florentina Sima (D7).
The following agencies provided critical assistance in securing Constantin’s arrest and extradition: Directorate for Combating Organized Crime (DCCO) - Service for Countering of Organized Criminal Groups; Pitești Brigade for Combating Organized Crime (BCCO Pitesti); Teleorman County Service for Countering Organized Crime; Romanian Gendarmerie Battalion; Romanian Ministry of Justice; and Romanian Criminal Investigative Directorate - Fugitive Unit.
“We thank Romanian authorities for their assistance in securing Mr. Constantin’s arrest and for their continued efforts in support of this case.”, said U.S. Attorney Tara McGrath.
This case is being prosecuted by Assistant U.S. Attorneys Jessica Adeline Schulberg and Valerie Chu. The Justice Department’s Office of International Affairs provided substantial assistance to secure the arrest and extradition from Romania of Constantin.
DEFENDANT Case Number 23CR2090-LAB
David Constantin Age: 28 Arges County, Romania
aka Vlad Alexandru
SUMMARY OF CHARGES
Title 18, U.S.C. § 1349 — Conspiracy to Commit Wire Fraud
Title 18, U.S.C. § 1343 — Wire Fraud
Maximum penalty: Thirty years in prison, $1 million fine
Title 18 U.S.C. § 1956(a)(2)(A) — Laundering of Monetary Instruments
Maximum penalty: Twenty years in prison and $500,000 fine or twice the value of the monetary instrument or funds involved in the transportation, transmission, or transfer, whichever is greater
INVESTIGATING AGENCIES
Federal Bureau of Investigation
San Diego Police Department Economic Crimes Unit
IRS Criminal Investigation
California Employment Development Department Investigative Division
U.S. Department of Labor Office of Inspector General
U.S. Department of Homeland Security
*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
Santa Barbara Man Charged with Coordinating Maritime Smuggling Attempt Resulting in Three Drowning DeathsRead the Press Release
NEWS RELEASE SUMMARY – February 22, 2024
SAN DIEGO – Charges unsealed today against Faustino Romero De La Cruz allege that he organized the attempted smuggling of multiple unauthorized immigrants by boat on April 10, 2022, which resulted in the tragic drowning deaths of three passengers.
Romero was arrested on February 21, 2024, in Santa Barbara. He made his first appearance in federal court in San Diego this afternoon.
According to court records, on April 10, 2022, human smugglers attempted to transport more than 10 unauthorized immigrants from Mexico into the United States aboard a cuddy-style boat. As the vessel approached the shore near the Ocean Beach Pier, it capsized with all passengers aboard. Despite the best efforts of law enforcement and other emergency response personnel, three victims drowned.
According to court records, Homeland Security agents identified Romero as a U.S.-based coordinator who, working with others, arranged for unauthorized immigrants to be smuggled into the United States by land and sea, and then collected thousands of dollars in smuggling fees before transporting them on to Northern California and elsewhere.
“Too many precious lives are needlessly lost in catastrophic incidents like this one,” said U.S. Attorney Tara McGrath. “Case after case demonstrates that smugglers are more interested in maximizing profits than safety, which all too often leads to tragic results. Never trust your life to a smuggler.”
“Maritime human smuggling has proven time and time again to be incredibly dangerous and often results in senseless claimed lives,” said Chad Plantz, special agent in charge for HSI San Diego. “While transnational criminal organizations seek to enrich themselves using the tactic, HSI is committed to using all means at our disposal to investigate and hold accountable those placing human beings at substantial risk of injury and death.”
This case is being prosecuted by Assistant U.S. Attorney James Miao and Special Assistant U.S. Attorney Joel Doolin.
DEFENDANTS Case Number 23cr2458-JES
Faustino Romero De La Cruz Age: 40 Santa Barbara, CA
SUMMARY OF CHARGES
Count 1: Conspiracy to Bring in Certain Aliens Other Than at Designated Port of Entry Resulting in Death – Title 8, U.S.C., Sec. 1324(a)(1)(A)(i), (v)(I), (a)(1)(B)(iv)
Maximum penalty: Life in prison, and $250,000 fine
Counts 2-4, 6: Attempted Bringing in Aliens for Financial Gain – Title 8, U.S.C., Sec. 1324(a)(2)(B)(ii)
Maximum penalty: Ten years in prison, a $250,000 fine
Count 5: Conspiracy to Bring in Certain Aliens Other Than at
Designated Port of Entry – Title 8, U.S.C., Sec. 1324(a)(1)(A)(i), (v)(I), (a)(1)(B)(i)
Maximum penalty: Ten years in prison, a $250,000 fine
Count 7: Transportation of Certain Aliens – Title 8, U.S.C., Sec. 1324(a)(1)(A)(ii)
Maximum penalty: Five years in prison, a $250,000 fine
INVESTIGATING AGENCIES
Homeland Security Investigations – San Diego Marine Task Force
United States Border Patrol
United States Customs and Border Protection
United States Coast Guard
San Diego County Sheriff’s Department
San Diego Harbor Police Department
San Diego County Medical Examiner’s Office
Homeland Security Investigations
Santa Barbara County Sheriff’s Office
*The charges and allegations contained in an indictment are merely accusations, and the defendant is considered innocent unless and until proven guilty.