District of Connecticut
Press releases recorded for this federal judicial district.
Venezuelan Man Who Made Threatening Calls to Newtown Residents Is SentencedRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, and Patricia M. Ferrick, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation, announced that WILFRIDO A. CARDENAS HOFFMANN, 31, of El Hatillo, Venezuela, was sentenced today by U.S. District Judge Michael P. Shea in Hartford to 12 months and one day of imprisonment, followed by three years of supervised release, for making threatening phone calls to residents of Newtown, Connecticut, shortly after the Sandy Hook Elementary School shooting tragedy in December 2012.
According to court documents and statements made in court, on December 16, 2012, two days after the shooting that claimed 26 lives at Sandy Hook Elementary School in Newtown, CARDENAS HOFFMANN used a voice over IP application on an iPod to make numerous phone calls from his home in Venezuela to Newtown residences. In one of the telephone calls, CARDENAS HOFFMANN stated: “This is Adam Lanza. I’m gonna [expletive] kill you. You’re dead. You’re dead. You hear me? You’re dead.” In another phone call, CARDENAS HOFFMANN stated: “This is Adam Lanza. I’m gonna kill you. You’re dead. With my machine gun. You’re dead [expletive].”
The investigation revealed that CARDENAS HOFFMANN made more than 90 calls to approximately 47 telephone numbers of Newtown residences. Not all of the calls were successfully placed and answered.
CARDENAS HOFFMANN was charged by criminal complaint on May 20, 2013. The complaint remained sealed until CARDENAS HOFFMANN was arrested on June 21, 2014, in Miami as he transitioned through Miami International Airport en route to Mexico from Venezuela. He has been detained since his arrest and pleaded guilty to the offense on December 11, 2014.“Threatening Newtown residents just two days after their tragedy was inexplicably cruel,” stated U.S. Attorney Daly. “This defendant’s senseless crimes re-victimized a brave yet fragile community that was already suffering a profound loss. Together with the FBI, our office is committed to tracking down individuals who commit such hoax crimes wherever they are, and bringing them to justice.”
“With today’s sentence, Mr. Hoffmann has been held accountable for his despicable actions that only served to perpetuate the pain and suffering the families living in Newtown have endured,” stated Special Agent in Charge Patricia M. Ferrick. “I would like to thank the investigators and prosecutors for their commitment to bring Mr. Hoffmann to justice.”
This matter has been investigated by the Federal Bureau of Investigation, with the assistance of the Newtown Police Department. The case was prosecuted by Assistant U.S. Attorneys Krishna Patel and Edward Chang.
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[email protected]Florida Man Sentenced to Prison for Role in Multimillion Dollar Drug TheftRead the Press Release
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The United States Attorney for the District of Connecticut announced that ALEXANDER MARQUEZ, 41, of Hialeah, Fla., was sentenced today by U.S. District Judge Janet Bond Arterton in New Haven to 12 months of imprisonment, followed by three years of supervised release, for his role in the theft of pharmaceuticals from an Eli Lilly Company warehouse and storage facility in Enfield, Conn.
According to court documents and statements made in court, in early 2010, Amaury Villa, Amed Villa, Yosmany Nunez and MARQUEZ planned to steal pharmaceuticals from the Eli Lilly Company warehouse and storage facility in Enfield. The investigation revealed that, prior to the theft, Amaury Villa and Nunez traveled from the Miami area to Connecticut to gather information about the warehouse facility and the surrounding area. Shortly before the theft, Amed Villa and Rafael Lopez traveled to Flushing, N.Y., where they purchased tools needed to break into the warehouse facility, and then traveled to Connecticut.
In the evening of March 13, 2010, individuals involved in the theft dropped off a ladder in the rear parking lot of the warehouse facility and left. That same night, MARQUEZ drove a tractor trailer to the facility. Thereafter, Amed Villa and Amaury Villa carried the ladder to the building, checked for security in the front area, climbed onto the roof, used the tools Amed Villa and Lopez had purchased to cut a hole in the facility roof, dropped down into the facility and disabled the alarm system. Amaury Villa, Amed Villa and Nunez then loaded more than 40 pallets of pharmaceuticals into the tractor trailer, which had been backed up to the loading dock of the warehouse.
The pallets of pharmaceuticals included thousands of boxes Zyprexa, Cymbalta, Prozac, Gemzar and other medicines, valued between $50 and $100 million.
The individuals who participated in the theft split up in Connecticut. MARQUEZ then drove the tractor trailer to Florida, where he subsequently reunited with Amaury Villa, Amed Villa and Nunez so the pharmaceuticals could be transferred from the tractor trailer into self-storage units in the Miami area.
On October 14, 2011, law enforcement authorities searched a storage facility in Florida and recovered pharmaceuticals that had been stolen from the Enfield warehouse.
Judge Arterton ordered MARQUEZ to pay restitution in the approximate amount of $60 million. The exact amount of restitution to be ordered will be determined after further submissions by the parties.
MARQUEZ, a citizen of Cuba, was arrested on April 17, 2014. On November 5, 2014, he pleaded guilty to one count of transportation of stolen property.
Amaury Villa, Amed Villa, Nunez and Lopez also have pleaded guilty. On February 4, 2015, Nunez was sentenced to 75 months of imprisonment. Amaury Villa, Amed Villa and Lopez await sentencing.
This matter is being investigated by the Federal Bureau of Investigation and the Enfield Police Department, with the assistance of several other U.S. Attorney’s Offices and federal, state and local law enforcement agencies that have been investigating large-scale thefts of pharmaceuticals and other products.
The case is being prosecuted by Assistant U.S. Attorneys Anastasia E. King and Douglas P. Morabito.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Attorney Sentenced to 30 Months in Prison for Laundering Drug MoneyRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that RALPH CROZIER, 63, was sentenced today by Chief U.S. District Judge Janet C. Hall in New Haven to 30 months of imprisonment, followed by three years of supervised release, for laundering drug money. He also was ordered to pay a $25,000 fine.
On September 25, 2014, a jury found CROZIER guilty of one count of conspiracy to launder monetary instruments and one count of attempt to launder monetary instruments. According to the evidence at trial, law enforcement began investigating CROZIER, an attorney based in Seymour, after receiving information from a convicted narcotics trafficker who was in federal custody. The narcotics trafficker stated that he was a former client of CROZIER and that CROZIER had convinced him to invest $30,000 in cash into CROZIER’s law partner’s solar energy company. CROZIER knew that the cash was derived from his client’s narcotics trafficking activities.
In 2013, the narcotics trafficker’s mother agreed to wear a recording device while meeting with CROZIER to discuss her son’s prior investment. On April 11, 2013, the woman brought $11,000 in DEA funds to a meeting with CROZIER, representing that her son had hidden the cash and wanted her to bring it to CROZIER. The conversation during the meeting made it clear that the money had been illegally derived from drug dealing. CROZIER accepted the cash and told the woman that he was going to make out the receipt in her son’s name, stating “I don’t want to put your name on anything because I don’t want you involved with hiding things from the Feds.” CROZIER was arrested shortly after the woman left his office.
“Attorney Crozier readily agreed to launder drug money for a narcotics dealer,” stated U.S. Attorney. “Money laundering is always a serious offense, but it is all the more serious when committed by an officer of the court. As attorneys are appropriately held to a higher standard, Crozier’s crimes are particularly troubling. This sentence reflects the seriousness of his offense and proper punishment for a lawyer who used his law license for criminal purposes.”
CROZIER, who is released on a $200,000 bond, was ordered to report to prison on April 17, 2015.
This matter was investigated by the Drug Enforcement Administration’s Bridgeport High Intensity Drug Trafficking Area Task Force and the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorneys Rahul Kale and Robert Spector, and Assistant U.S. Attorney Charles Rombeau of the District of New Hampshire.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Branford Woman Who Failed to Pay Taxes on Gifting Tables Pyramid Scheme Profits Is SentencedRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that NANCY DILLON, 70, of Branford, was sentenced today by U.S. District Judge Alvin W. Thompson in Hartford to one year of probation, the first six months of which DILLON must serve in home confinement, for failing to pay taxes on income she received while participating in an illegal pyramid scheme known as “Gifting Tables.” Judge Thompson also ordered DILLON to perform 100 hours of community service, pay a $2,000 fine and back taxes, penalties and interest.
According to court documents and statements made in court, a Gifting Table is configured as a four-level pyramid, with eight participants assigned to the bottom row, four participants assigned to the third row, two participants assigned to the second row, and one participant assigned to the top row. The top row participant is referred to as the “Dessert,” the two participants on the second row as “Entrees,” the four participants on the third row as “Soup and Salads,” and the eight participants on the bottom row as “Appetizers.” To join a Gifting Table, new participants were required to pay $5,000, typically cash, to the Dessert, that is, the participant occupying the top position on the pyramid. The $5,000 payment, which was fraudulently characterized as a gift, secured the new participant a position as an Appetizer on the bottom row. Participants progressed from the bottom row of the pyramid by recruiting additional people to join the Gifting Table. When eight new participants joined a Gifting Table, each having made a $5,000 “gift” to the person occupying the Dessert position at the top of the pyramid, the Dessert left the Gifting Table and kept the $40,000 paid by the eight new participants. That particular Gifting Table was then split, with the two participants occupying the Entree position on the second row moving to the top position (Dessert) of two new pyramids. The other incumbent members of the Gifting Table moved up a row on one of the two newly-formed pyramids, and the search for 16 new participants began. The success of the Gifting Tables depended on new participants joining and making the $5,000 “gift.”
In 2009, DILLON received $40,000 while participating in the Gifting Tables scheme. Even though she had been advised by an attorney that the money was taxable income and not a gift, she failed to pay federal income taxes on the money she received.
On June 30, 2014, DILLON pleaded guilty to one count of willful failure to file a return, supply information or pay tax.
This matter is being investigated by the Internal Revenue Service – Criminal Investigation Division and prosecuted by Assistant U.S. Attorneys Douglas P. Morabito and Peter S. Jongbloed.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Waterbury Man Admits Role in Massive Stolen Identity Tax Refund SchemeRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that JULIO LARA TRINIDAD, 28, of Waterbury, pleaded guilty today in New Haven federal court to federal offenses stemming from a stolen identity tax refund fraud scheme that the government believes resulted in a loss of more than $7.5 million from the U.S. Treasury.
According to court documents and statements made in court, this matter stems from an investigation into individuals who, through various means, obtained fraudulent U.S. Treasury tax refund checks using stolen identities. After obtaining the checks, individuals sold them for less than face value of the checks, or deposited them into bank accounts that had been opened using fraudulent identifying documents. The funds were then quickly withdrawn from the bank accounts.
In 2011, TRINIDAD was arrested in New Jersey for stealing U.S. Treasury tax refund checks from mailboxes. He pleaded guilty to a related charge in the District of New Jersey in January 2012. An arrest warrant was issued for TRINIDAD after he failed to appear for his sentencing in May 2012. TRINIDAD was arrested on November 23, 2013, and subsequently was charged by indictment in the District of Connecticut.
The government alleges that in June 2012, while he was a fugitive from justice, TRINIDAD opened a checking account in the name of an identity theft victim. Between December 2012 and February 2013, the checking account was used to purchase six licenses for a brand of tax preparation software. According to the government, these licenses were used to file more than 60,000 federal income tax returns, seeking more than $234 million in federal tax refunds intended to be issued to TRINIDAD and his co-conspirators. Nearly $6.8 million in fraudulent refunds were issued before the scheme was identified.
The government further alleges that TRINIDAD and individuals he recruited used additional stolen identities to open other bank accounts into which hundreds of thousands of dollars in fraudulently-obtained tax refunds were deposited. TRINIDAD’s co-defendant, Jerry De Los Santos Rodriguez, has admitted that he and TRINIDAD opened bank accounts using fraudulent identities. In addition, between July and October 2013, TRINIDAD and Ramon Mena sold more than $60,000 in fraudulently-obtained U.S. Treasury checks to an individual working with law enforcement. TRINIDAD and Mena received some of these checks from Pricilla Brito and Yowandy DeLeon.
TRINIDAD pleaded guilty to one count of theft of public money, which carries a maximum term of imprisonment of 10 years, and one count of aggravated identity theft, which carries a mandatory consecutive sentence of two years of imprisonment. He is scheduled to be sentenced by Senior U.S. District Judge Ellen Bree Burns on May 5, 2015.
TRINIDAD has been detained since his arrest.
De Los Santos Rodriguez, Mena, Brito and DeLeon previously pleaded guilty.
This matter is being investigated by the United States Postal Inspection Service, the Internal Revenue Service – Criminal Investigation Division, the United States Secret Service and Homeland Security Investigations, with the assistance of the Danbury and Darien Police Departments. The case is being prosecuted by Assistant U.S. Attorney Sarala V. Nagala.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Hartford Man Admits Manufacturing and Distributing PcpRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that a KEVIN BETTS, also known as “KK,” 28, of Hartford, pleaded guilty today in Hartford federal court to a federal charge stemming from his manufacture and distribution of PCP.
According to court documents and statements made in court, BETTS manufactured Phencyclidine (“PCP”) in his apartment at 57 Sumner Street in Hartford and, on five occasions in July and August 2014, sold the drug out of his apartment to an individual working with law enforcement.
On August 1, 2014, investigators searched the apartment and recovered more than 60 grams of PCP, scales, packaging material, six firearms, approximately 215 rounds of ammunition and a bullet proof vest.
BETTS pleaded guilty to one count of maintaining a drug-involved premises, which carries a maximum term of imprisonment of 20 years. He is scheduled to be sentenced by U.S. District Judge Michael P. Shea on May 5, 2015. As part of the resolution of this case, BETTS agreed to the forfeiture of the firearms, ammunition and bullet proof vest.
This prosecution stems from Project Longevity, a comprehensive initiative to reduce gun violence in Connecticut’s major cities. Through Project Longevity, community members and law enforcement directly engage with members of groups that are prone to commit violence. A critical component of the Project Longevity strategy is the “call-in,” a face-to-face meeting where Project Longevity partners engage group members and deliver a community message against violence, a law enforcement message about the consequences of further violence and an offer of help for those who want it. Close associates of BETTS attended a call-in on April 1, 2014, in Hartford, but members of their group are suspected of being involved in several shooting incidents since then.
This ongoing investigation is being conducted by the Hartford Police Department and the FBI’s Northern Connecticut Violent Crimes Task Force. The FBI task force includes members of the Hartford Police Department, East Hartford Police Department, Connecticut State Police and Connecticut Department of Correction. The case is being prosecuted by Assistant U.S. Attorney Michael J. Gustafson.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Hartford Heroin Trafficker Sentenced to 46 Months in Federal PrisonRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that CHRISTOPHER CARDONA, also known as “Tito,” 30, of Hartford, was sentenced today by U.S. District Judge Vanessa L. Bryant in Hartford to 46 months of imprisonment, followed by three years of supervised release, for trafficking heroin.
According to court documents and statements made in court, a joint investigation into heroin trafficking in the Hartford area identified CARDONA as a distributor of the drug. On two occasions in March 2014, an individual working with law enforcement purchased approximately nine grams of heroin from Antonio Baez of Hartford. The investigation revealed that CARDONA and another individual supplied the heroin to Baez, and had been supplying Baez with heroin for approximately two years.
CARDONA has been detained since his arrest on March 12, 2014. On November 19, 2014, he pleaded guilty to one count of conspiracy to possess with intent to distribute heroin, and to distribute, heroin.
Baez has pleaded guilty and awaits sentencing.
This matter is being investigated by the Drug Enforcement Administration, Federal Bureau of Investigation and Hartford Police Department. The case is being prosecuted by Assistant U.S. Attorneys Patrick Caruso and Brian Leaming.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Two Former Danbury Residents Involved in U.S. Postal Money Order Fraud Scheme Are SentencedRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that two former residents of Danbury were sentenced yesterday in Hartford federal court for participating in a conspiracy involving the theft of monies from the U.S. Postal Service. U.S. District Judge Michael P. Shea sentenced TONY STERLIN CANTAVE, 34, to 13 months of imprisonment, followed by two years of supervised release, and VENUS VERGES, 34, to three years of probation, during which she must perform 100 hours of community service.
According to court documents and statements made in court, between August and October 2013, CANTAVE and VERGES purchased U.S. Postal Service money orders in amounts ranging from $400 to $1000 at post offices in Stamford, Bridgeport, Greenwich, and lower Westchester County, N.Y. After the money orders were purchased, the defendants used a mobile banking application to deposit the funds into bank accounts they controlled. Shortly after depositing the funds, the defendants returned to the post offices from which the respective money orders had been purchased, failed to disclose that they had deposited the funds, returned the money orders and were refunded their money.
CANTAVE and VERGES stole approximately $12,300 from the U.S. Postal Service during the course of this scheme.
CANTAVE and VERGES were arrested on June 20, 2014. On August 20, 2014, CANTAVE pleaded guilty to one count of conspiracy to convert public money and two counts of conversion of public money, and VERGES pleaded guilty to one count of conspiracy to convert public money and one count of conversion of public money.
Judge Shea ordered both defendants to pay full restitution.
This matter was by the U.S. Postal Inspection Service and was prosecuted by Assistant U.S. Attorney John H. Durham.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
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[email protected]Two Former Bridgeport Police Officers Sentenced to Prison for Using Unreasonable Force During ArrestRead the Press Release
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Deirdre M, Daly, United States Attorney for the District of Connecticut, announced that two former Bridgeport Police officers were sentenced today in Bridgeport federal court for violating an individual’s civil rights by using unreasonable force during the course of an arrest. U.S. District Judge Jeffery Alker Meyer sentenced both ELSON MORALES, 43, and JOSEPH LAWLOR, 41, to three months of imprisonment and six months of supervised release.
According to court documents and statements made in court, on May 20, 2011, officers MORALES and LAWLOR engaged in a high speed chase of a van driven by an individual who was suspected of having a firearm and had failed to stop at traffic stop. After a further foot pursuit in Beardsley Park in Bridgeport, the individual was apprehended by MORALES who used his department-issued Taser to incapacitate the individual. Despite the fact the individual was on the ground and effectively incapacitated by the initial use of the Taser, MORALES deployed the Taser a second time and LAWLOR kicked the individual several times.
“The use of unreasonable force is illegal,” stated U.S. Attorney Daly. “When a police officer uses unreasonable force, he both violates the victim’s civil rights and undermines the community’s trust in law enforcement. The vast majority of Bridgeport Police Department members, and all law enforcement officers, are public servants who dedicate their lives to protecting the public. However, any police officer who crosses the line during an arrest risks federal prosecution and, as this case demonstrates, incarceration.”
On June 10, 2014, MORALES and LAWLOR each pleaded guilty to one count of deprivation of rights under color of law.
MORALES and LAWLOR have resigned from the Bridgeport Police Department.
This matter was investigated by the Federal Bureau of Investigation and was prosecuted by Assistant U.S. Attorneys Anastasia E. King and David E. Novick.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]New Haven Man Pleads Guilty to Possessing Stolen FirearmRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that PAUL BURRUS, 44, of New Haven, waived his right to indictment and pleaded guilty yesterday in New Haven federal court to one count of possession of a stolen firearm.
According to court documents and statements made in court, on September 5, 2014, a New Haven Police officer stopped a car in which BURRUS was a passenger in the area of West Ivy Street. As the officer approached the car, he observed BURRUS appear to be hiding or moving something under the front passenger seat. After the officer ordered BURRUS out of the car, he found a loaded Smith and Wesson M & P .45 caliber semi-automatic pistol under the passenger seat.
The firearm had been reported stolen in East Haven in August 2011. BURRUS has admitted that that he purchased the firearm and ammunition for $500, and that he had reason to believe that the firearm had been stolen.
BURRUS is scheduled to be sentenced by Chief U.S. District Judge Janet C. Hall on May 12, 2015, at which time he faces a maximum term of imprisonment of 10 years.
The matter is being investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the New Haven Police Department and is being prosecuted by Assistant U.S. Attorneys Anthony Kaplan and Jennifer Laraia.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Hartford Man Sentenced to More Than 7 Years in Prison for Drug Distribution, Illegal Gun PossessionRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that VINCENT NELSON, also known as “June,” 29, of Hartford, was sentenced yesterday by U.S. District Judge Robert N. Chatigny in Hartford to 90 months of imprisonment, followed by four years of supervised release, for distributing narcotics and illegally possessing firearms.
According to court documents and statements made in court, this matter stems from an FBI Northern Connecticut Violent Crime and Gang Task Force investigation targeting gang and drug related activity in Hartford’s South End. Beginning in November 2012, investigators made controlled purchases of crack cocaine from NELSON and his associate, Steven Granger, in the South End. NELSON and Granger were identified by investigators as members of Money Green/Bedroc, a gang that at a time controlled the Bedford and Green Street neighborhoods off Albany Avenue in Hartford’s North End. Money Green/Bedroc’s principal rival, the AVE, controlled the narcotics activity in adjacent neighborhoods, and the long standing dispute between the two gangs caused violent activity, including shootings and murders, in the area from 2008 until 2012.
NELSON’s criminal history includes multiple felony convictions, including a conviction for first degree assault for which he was sentenced to five years of imprisonment in 2009.
NELSON, Granger and another associate, Hector Alfonso of East Hartford, were arrested on January 23, 2013. On that date, court-authorized searches of NELSON’s residence at 2 Warner Street Extension and Granger’s residence at 52 Elliott Street resulted in the seizure of three handguns, assorted ammunition, body armor, approximately 300 grams of crack cocaine, approximately 300 grams of cocaine, a small quantity of heroin, narcotics packaging material and $45,736 in cash. Investigators also seized two vehicles.
NELSON has been detained since his arrest. On July 9, 2014, he pleaded guilty to one count of conspiracy to possess with intent to distribute, and distribution of, 28 grams or more of cocaine base (“crack”), and one count of possession of a firearm and ammunition by a convicted felon.
Granger and Alfonso also pleaded guilty and previously were sentenced to prison terms of 60 months and 18 months, respectively.
The matter was investigated by the FBI’s Northern Connecticut Violent Crimes Gang Task Force, which includes representatives of the FBI, Connecticut State Police, the Hartford Police Department and the Connecticut Department of Correction, with the assistance of the Bureau of Alcohol, Tobacco, Firearms and Explosives. The case was prosecuted by Assistant United States Attorney Brian P. Leaming.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Treasurer of Connecticut Canine Search and Rescue Organization Admits Embezzling $150,000Read the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that THOMAS RECCK, 50, of New Britain, waived his right to indictment and pleaded guilty today before U.S. District Judge Jeffrey Alker Meyer in Bridgeport to fraud and tax charges stemming from an embezzlement scheme.
According to court documents and statements made in court, RECCK was the Treasurer for Connecticut Canine Search and Rescue, Inc. (“CCSAR”) in Kensington, a volunteer-based nonprofit organization dedicated to the search and rescue of missing and lost persons in the United States by using trained search and rescue dogs. In his capacity as the treasurer, RECCK had access to the bank accounts of CCSAR. From approximately January 2008 to August 2012, RECCK transferred $150,329.57 from CCCSR accounts into a separate account that he controlled and used the funds to gamble and for other personal expenses.
RECCK also failed to report the stolen funds on his federal tax returns.
RECCK pleaded guilty to one count of wire fraud, which carries a maximum term of imprisonment of 20 years, and one count of filing a false tax return, which carries a maximum term of imprisonment of three years. Judge Meyer scheduled sentencing for April 29, 2015.
RECCK also has agreed to full restitution, as well as back taxes, penalties and interest for the 2008 through 2012 tax years.
Following his guilty plea, RECCK was released on bond.
This investigation is being conducted by the Connecticut Financial Crimes Task Force, the Internal Revenue Service – Criminal Investigation Division and the Greenwich Police Department. The case is being prosecuted by Assistant U.S. Attorney Douglas P. Morabito.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Florida Man Sentenced to More Than 6 Years in Prison for Role in Multimillion Dollar Drug TheftRead the Press Release
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The United States Attorney for the District of Connecticut announced that YOSMANY NUNEZ, also known as “El Gato,” 42, of Southwest Ranches, Fla., was sentenced today by U.S. District Judge Janet Bond Arterton in New Haven to 75 months of imprisonment, followed by three years of supervised release, for his role in the theft of pharmaceuticals from an Eli Lilly Company warehouse and storage facility in Enfield, Conn.
According to court documents and statements made in court, in early 2010, NUNEZ, Amaury Villa, Amed Villa and Alexander Marquez planned to steal pharmaceuticals from the Eli Lilly Company warehouse and storage facility in Enfield. The investigation revealed that, prior to the theft, NUNEZ and Amaury Villa traveled from the Miami area to Connecticut to gather information about the warehouse facility and the surrounding area. Shortly before the theft, Amed Villa and Rafael Lopez traveled to Flushing, N.Y., where they purchased tools needed to break into the warehouse facility, and then traveled to Connecticut.
In the evening of March 13, 2010, individuals involved in the theft dropped off a ladder in the rear parking lot of the warehouse facility and left. That same night, Marquez drove a tractor trailer to the facility. Thereafter, Amed Villa and Amaury Villa carried the ladder to the building, checked for security in the front area, climbed onto the roof, used the tools Amed Villa and Lopez had purchased to cut a hole in the facility roof, dropped down into the facility and disabled the alarm system. Amaury Villa, Amed Villa and NUNEZ then loaded more than 40 pallets of pharmaceuticals into the tractor trailer, which had been backed up to the loading dock of the warehouse.
The pallets of pharmaceuticals included thousands of boxes Zyprexa, Cymbalta, Prozac, Gemzar and other medicines, valued between $50 and $100 million.
The individuals who participated in the theft split up in Connecticut. Marquez then drove the tractor trailer to Florida, where he subsequently reunited with Amaury Villa, Amed Villa and NUNEZ so the pharmaceuticals could be transferred from the tractor trailer into self-storage units in the Miami area.
On October 14, 2011, law enforcement authorities searched a storage facility in Florida and recovered pharmaceuticals that had been stolen from the Enfield warehouse.Judge Arterton ordered NUNEZ to pay restitution in the approximate amount of $60 million, but the exact amount of restitution to be ordered will be determined after further submissions by the parties.
NUNEZ, a citizen of Cuba, has been detained since his arrest on April 17, 2014. On November 5, 2014, he pleaded guilty to one count of transportation of stolen property.
Amaury Villa, Amed Villa, Marquez and Lopez have pleaded guilty and await sentencing.
This matter is being investigated by the Federal Bureau of Investigation and the Enfield Police Department, with the assistance of several other U.S. Attorney’s Offices and federal, state and local law enforcement agencies that have been investigating large-scale thefts of pharmaceuticals and other products.
The case is being prosecuted by Assistant U.S. Attorneys Anastasia E. King and Douglas P. Morabito.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Federal Law Enforcement Authorities Announce Formation of Task Force to Fight Public CorruptionRead the Press Release
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United States Attorney Deirdre M. Daly and representatives from five federal law enforcement agencies today announced the formation of the Connecticut Public Corruption Task Force to investigate corrupt public officials, the misuse of public funds and related criminal activity.
The Connecticut Public Corruption Task Force includes representatives from the Federal Bureau of Investigation, United States Postal Inspection Service, Internal Revenue Service – Criminal Investigation Division, and the Inspector General’s Offices of the United States Department of Health and Human Services and the United States Department of Housing and Urban Development.
“For the first time in Connecticut, we have brought together in a single investigative unit, agents and inspectors from the federal agencies that have primary responsibility for investigating public corruption,” said U.S. Attorney Daly. “Although each of these agencies has a history of working together, bringing some of the best agents in the state into one unit with a singular purpose of investigating all manner of corruption is an optimal way to address the complex and varied threats posed by corrupt activity.”
U.S. Attorney Daly explained that the Task Force is focused on rooting out not only corrupt elected officials, but also federal, state and municipal employees who use their position for personal gain at the expense of the public good. The Task Force also will investigate corruption that threatens public resources, the electoral process, and fair economic opportunities for citizens and businesses. In addition, the Task Force is charged with uncovering corruption within both public and private institutions that receive and misuse taxpayer dollars.
Assistant U.S. Attorney Christopher M. Mattei, who is Chief of the U.S. Attorney’s Office’s Financial Fraud and Public Corruption Unit, is coordinating the Task Force. The FBI has committed resources to support all Task Force investigations and serves as the lead investigative agency.
“The New Haven Division of the FBI is joining forces with our federal agency partners to combat public corruption throughout the State of Connecticut,” said FBI Special Agent in Charge Patricia M. Ferrick. “With the assistance and cooperation of these partners, the Connecticut Public Corruption Task force is well positioned to successfully root out and put an end to public corruption within our area. Public servants are entrusted by all of us to act in the best interests of the public they serve. It is important for the United States to bring to justice those who betray that trust. Public corruption at all levels of local, state, and federal government must not be tolerated, and this task force will leverage the best assets of the task force partner agencies to address the threat posed by corrupt public officials.”
The Task Force has been at work for several months and has already made significant gains in several investigations, including the recent arrest of the former Finance Director of Plymouth who is alleged to have embezzled more than $800,000 from the town.
“The Postal Inspection Service has enjoyed a close relationship with the Connecticut U.S. Attorney’s Office through the years working intricate and complex fraud cases that involve the illicit use of the U.S Mails,” said Inspector in Charge Shelly A. Binkowski of the U.S. Postal Inspection Service. “The U.S. Postal Inspection Service welcomes the formation of the Connecticut Public Corruption Task Force, a partnership that presents a tremendous opportunity for various agencies to pool resources and expertise to ensure public officials are held accountable.”
“Investigating public corruption remains one of IRS Criminal Investigation’s highest priorities,” said William Offord, Special Agent in Charge, Internal Revenue Service. “Public trust is broken when elected or appointed officials commit crimes – most often triggered by greed and resulting in unlawful personal financial gain. IRS agents contribute their financial investigative expertise to this formidable investigative team.”
“As part of the Public Corruption Task Force, HHS OIG will ensure that the department’s dollars are not misused though public corruption and are instead used for their intended purpose of ensuring that the most vulnerable members of our society – including the elderly, poor and children – receive services funded at least in part by taxpayers,” said Phillip Coyne, Special Agent in Charge of the Boston Regional Office of the Health and Human Services Office of the Inspector General. “Working with our federal, state and local law enforcement partners, we will continue to vigorously bring those who steal from these programs to justice.”
“The core mission of the U.S. Department of Housing and Urban Development (HUD) includes creating strong, sustainable communities and quality affordable homes for all,” said Christina Scaringi, Special Agent in Charge of the Northeast Region of HUD’s Office of Inspector General. “To carry out its mission, HUD depends on the services of housing authority staff; owners and management agents of HUD-assisted multifamily developments; state, local, and municipal governments that receive HUD funding in the form of community development grants; and nonprofit organizations that administer a variety of programs including housing the homeless. HUD also oversees the administration of over $150 million awarded to the State of Connecticut for Hurricane Irene and Sandy disaster relief purposes. HUD OIG is dedicated to aggressively pursuing those who choose to engage in corrupt behavior, and we are proud to be a part of this all-important task force.”
U.S. Attorney Daly encouraged citizens to report corrupt activity by calling 1-800-CALL-FBI (1-800-225-5324).
“Connecticut’s unfortunate recent history with corruption is well known, but so is this Office’s history of combating corrupt activity,” said U.S. Attorney Daly. “Our efforts have been aided by a dogged media and courageous, conscientious citizens, business owners and public officials who have provided information about corrupt activity in their midst. We call on public servants, the vast majority of whom are honest brokers, to not look the other way when they see indications of corruption. We cannot overstate the importance of citizen participation in our fight against corruption, and we urge all citizens to assist us in this effort.”
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[email protected]Newington Man Sentenced to 6 Years in Prison for Role in Coast-to-coast Cocaine Trafficking RingRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that JERMAINE JENKINS, 34, formerly of Newington, was sentenced today by U.S. District Judge Michael P. Shea in Hartford to 72 months of imprisonment, followed by four years of supervised release, for his role in a cocaine trafficking ring.
This matter stems from a joint law enforcement investigation headed by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and Drug Enforcement Administration into a drug trafficking organization that involved individuals in California using the U.S. Mail and commercial carriers to send large quantities of cocaine to co-conspirators in the Hartford area who sold the narcotics for profit.
According to court documents and statements made in court, Joseph Miller of Los Angeles, formerly of East Hartford, sent kilogram parcels of cocaine from California to JENKINS, Luther Nance and their associates in Connecticut. JENKINS, Nance and others then distributed the cocaine, or converted the cocaine into crack for street sale.
The investigation revealed that certain co-conspirators traveled to California with a large amount of cash to finance the purchase of cocaine. Co-conspirators also made numerous cash deposits into local bank accounts, as well as wire transfers. The cash deposits were made at several branches of the same bank in the Hartford area in amounts of less than $10,000 in order to evade the bank’s currency transaction reporting requirements.
On November 14, 2013, a federal grand jury returned two-count indictment charging JENKINS, Miller and six other defendants.
On June 27, 2013, a federal grand jury returned a 51-count superseding indictment charging Nance and 14 other individuals with narcotics conspiracy and related offenses stemming from the sale of crack cocaine and heroin in several communities throughout Connecticut.
JENKINS’ criminal history includes a federal conviction in 2006 for distributing crack cocaine, and he was on federal supervised release at the time of this most recent offense. On July 21, 2013, U.S. District Judge Vanessa L. Bryant revoked JENKINS’ bond and sentenced him to an additional 18 months of imprisonment. He has been detained since October 23, 2013.
On October 14, 2014, he pleaded guilty to one count of conspiracy to distribute and to possess with intent to distribute 500 grams or more of cocaine, and one count of conspiracy to commit money laundering.
Miller and Nance have pleaded guilty and await sentencing.This matter is being investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Drug Enforcement Administration, the Internal Revenue Service – Criminal Investigation Division, the U.S. Marshals Service, the Office of the Chief State’s Attorney, the State’s Attorney for the Judicial District of Hartford, and the Hartford, Willimantic, East Hartford, Enfield and Middletown Police Departments.
The case is being prosecuted by Assistant U.S. Attorney Geoffrey M. Stone.
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[email protected]Norwalk Business Owner Sentenced to Prison for Tax EvasionRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that on Friday, January 30, ALAN R. PAGANO, 64, of Darien, was sentenced by U.S. District Judge Alvin W. Thompson in Hartford to 12 months and one day of imprisonment, followed by three years of supervised release, for tax evasion. He also was ordered to pay a $10,000 fine.
According to court documents and statements made in court, PAGANO is the president and majority owner of Pagano’s Retail, Inc., a wholesale seafood distribution business based in Norwalk. From 2006 to 2010, PAGANO diverted a total of $780,608 in cash that the business received, deposited the money into his personal bank account, and failed to pay $238,739 in federal taxes on the income.
Over the five year period, PAGANO structured cash deposits in amounts of less than $10,001 in order to evade his bank’s currency transaction reporting requirements. For example, in 2007, PAGANO made 16 currency deposits in amounts ranging from $9,000 to $9,900.
On October 29, 2013, PAGANO pleaded guilty to one count of tax evasion.
PAGANO has paid restitution of $238,739 to the Department of Treasury, but still owes substantial penalties and interest. As part of his sentence, Judge Underhill ordered PAGANO to cooperate with the Internal Revenue Service concerning his taxes, stay current with filing his tax returns, and pay the penalties and interest the IRS assesses for tax years 2006 to 2010.
PAGANO also forfeited an additional $90,000 in relation to the structuring of cash deposits.
This matter was investigated by the Internal Revenue Service – Criminal Investigation Division, and was prosecuted by Assistant U.S. Attorney Peter S. Jongbloed.
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[email protected]New London Man Sentenced to More Than 7 Years in Federal Prison for Illegal Gun PossessionRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that on Friday, January 30, MAURICE L. MILLIGAN, 36, of New London, was sentenced by U.S. District Judge Vanessa L. Bryant in Hartford to 90 months of imprisonment, followed by three years of supervised release, for illegally possessing a firearm.
According to court documents and statements made in court, at approximately 11:30 p.m. on April 22, 2013, New London Police received reports of shots fired in the vicinity of a convenience store located on Ocean Avenue near the intersection of Evergreen and Sherman Streets. Responding officers did not find any victim of the shooting, but did locate and seize four spent 9mm Winchester shell casings in the immediate area. The investigation determined that two males had had a verbal altercation inside the convenience store and, shortly thereafter, a number of shots had been fired outside the business. Review of video from inside and outside the store led to the identification of MILLIGAN as the probable shooter.
On April 25, 2013, New London Police observed MILLIGAN sitting in the driver’s seat of a parked vehicle. Officers ordered MILLIGAN to exit the car and saw that he was wearing a bullet-proof vest. Officers then searched the vehicle and recovered from under the driver’s seat a Glock, Model 17, 9mm semi-automatic pistol with an obliterated serial number. The handgun was loaded with 19 rounds of Winchester 9mm ammunition. Further examination of the gun revealed that the serial number on the frame of the weapon had been removed.
A ballistics comparison made of the shell casings recovered on the night of April 22 with the Glock seized from under the driver’s seat of the car MILLIGAN was driving on April 25 established that the Glock was the weapon that fired the shots.
Prior to April 2013, MILLIGAN had been convicted in the Queens County (N.Y.) Supreme Court of third degree criminal possession of a loaded firearm and second degree robbery.
It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce. It is also a violation of federal law for a convicted felon to wear protective body armor, and for an individual who has been convicted of a violent felony offense to possess body armor.
MILLIGAN has been detained since his arrest on April 25, 2013. On June 23, 2014, he pleaded guilty to one count of possession of a firearm by a previously convicted felon.
This matter was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the New London Police Department and the Office of the State’s Attorney for the Judicial District of New London. The case was prosecuted by Assistant U.S. Attorney John H. Durham.
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[email protected]Bridgeport Man Sentenced to 62 Months in Prison for Possessing Stolen Gun, Violating Supervised ReleaseRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that on Friday, January 30, RAHSHIM CARTER, also known as “Jinks” and “Mace,” 26, of Bridgeport, was sentenced by U.S. District Judge Michael P. Shea in Hartford to 62 months of imprisonment for being a felon in possession of a firearm, and for violating his supervised release from a previous federal conviction.
According to court documents and statements made in court, on January 9, 2013, CARTER was sentenced in Hartford federal court to 18 months of imprisonment and three years of supervised release for distributing heroin in and around the Trumbull Gardens housing complex in Bridgeport. He was released from prison on September 11, 2013, and began serving his term of supervised release.
On February 14, 2014, Bridgeport Police received a report that a man driving a black Dodge Durango was selling narcotics in the area of Trumbull Avenue and Reservoir Avenue. Police caught up to the Durango on Reservoir Avenue, pulled it over and learned that a license plate on the Durango belonged to another vehicle. CARTER was in the driver’s seat of the Durango and a woman was in the passenger seat. A search of CARTER’s female passenger revealed a loaded Smith & Wesson Bodyguard .380 firearm. A search of the vehicle also revealed approximately 250 glassine envelopes, commonly used to package heroin for street sale, and a stamp kit.
The investigation revealed that CARTER possessed the firearm and that he attempted to conceal it in the woman’s pants as he was about to be stopped by police. The investigation further revealed that the firearm was one of 111 firearms stolen from Smith & Wesson’s distribution plant in Springfield, Massachusetts, in November 2012.
CARTER has been detained since his federal arrest on April 9, 2014. On November 3, 2014, he pleaded guilty to one count of possession of a firearm by a previously convicted felon.
Judge Shea sentenced CARTER to 50 months of imprisonment for illegally possessing a firearm, and a consecutive 12-month prison term for violating the terms and conditions of his supervised release.
This matter was investigated by the FBI’s Bridgeport Safe Streets Task Force and the Bridgeport Police Department. The case was prosecuted by Assistant U.S. Attorney Rahul Kale.
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[email protected]Bridgeport Man Sentenced to 3 Years in Prison for Illegally Possessing Loaded Handgun in NorwalkRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that on Friday, January 30, DAHONTA HILLIARD, 24, of Bridgeport, was sentenced by U.S. District Judge Vanessa L. Bryant in Hartford to 36 months of imprisonment, followed by three years of supervised release, for being a previously convicted felon in possession of a firearm.
According to court documents and statements made in court, on August 25, 2013, Norwalk police officers were called to disband a fight between 15 to 20 people in the King Kennedy housing complex. As officers approached the housing complex, individuals, including HILLIARD, began to scatter. From his previous encounters with Norwalk Police, HILLIARD was known as a Crips gang associate who was not a resident of the housing complex. Officers approached HILLIARD and asked him if he had any weapons. After HILLIARD responded that he had a knife, officers searched him and found a loaded Bersa .380 semi-automatic handgun.
Prior to August 2013, HILLIARD was convicted of a felony offense. It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.
HILLIARD has been detained since his federal arrest on March 3, 2014. On August 14, 2014, he pleaded guilty to one count of possession of a firearm by a previously convicted felon.
This matter was investigated by the Norwalk Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. The case was prosecuted by Assistant U.S. Attorney Vanessa Richards.
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[email protected]Insert Title HereRead the Press Release
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[email protected]Attorney Sentenced to Prison for Filing False Tax ReturnsRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that TIMOTHY G. GRIFFIN, 55, of Ridgefield, was sentenced today by U.S. District Judge Stefan R. Underhill in Bridgeport to six months of imprisonment, followed by one year of supervised release, for filing false tax returns. He also was ordered to pay a $1,000 fine and restitution to the U.S Treasury.
According to court documents and statements made in court, GRIFFIN practiced law in Bronxville, New York, and his clients paid him for his legal services. In 2006, the Internal Revenue Service sent letters to GRIFFIN about his having not filed income tax returns for 2002, 2003, and 2004 tax years. In response to the IRS inquiry, GRIFFIN prepared and submitted fraudulent individual income tax returns for the 2003 and 2004 tax years. The 2003 return reported income of $77,713, gross receipts from the law practice of $225,825, a net profit of $32,200, and a total tax of $10,981. The 2004 return reported income of $67,983, gross receipts from the law practice of $234,894, a net profit of $39,767, and a total tax of $9,606. A subsequent criminal investigation determined that GRIFFIN did not report on these two tax returns approximately $498,934 in additional gross receipts from his law practice, resulting in additional tax due of $136,844.
On September 30, 2014, GRIFFIN waived his right to indictment and pleaded guilty to one count of filing a false tax return.
Judge Underhill ordered GRIFFIN to make restitution to the U.S. Department of Treasury in the total amount of $153,807 – which includes $136,844 for the 2003 and 2004 tax years and $16,963 for the 2005 and 2006 tax years – plus applicable penalties and interest.
GRIFFIN also has two pending criminal cases in the State of New York, one involving his alleged embezzlement of $1,955,000 from the United Hebrew Cemetery on Staten Island, and one involving his alleged embezzlement of approximately $750,000 from seven clients.
This matter was investigated by the Internal Revenue Service – Criminal Investigation Division, and was prosecuted by Assistant U.S. Attorney Peter S. Jongbloed.
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[email protected]Former Controller of Greenwich Hedge Fund Admits Embezzling More Than $9 MillionRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, and Patricia M. Ferrick, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation, announced that LAWRENCE J. HERZING, 45, of Greenwich, pleaded guilty today before U.S. District Judge Jeffrey Alker Meyer in Bridgeport to one count of wire fraud stemming from his theft of more than $9 million from the hedge fund where he was employed.
According to court documents and statements made in court, HERZING was recently employed as the controller of Greenwich-based Contrarian Capital Management, L.L.C. On 32 occasions between 2004 and 2013, HERZING used his position to wire $9,202,417.54 from his employer to accounts that he controlled.
HERZING was arrested on October 29, 2014, and currently is released on a $5.6 million bond.
Judge Meyer scheduled sentencing for April 24, 2015, at which time HERZING faces a maximum term of imprisonment of 20 years, a fine and an order of restitution. HERZING also has agreed to forfeit his residence and approximately $1.8 million.
This matter is being investigated by the Federal Bureau of Investigation, with the assistance of the Greenwich Police Department. The case is being prosecuted by Assistant U.S. Attorneys Jonathan Francis and Heather Cherry.
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[email protected]Fairfield Man Who Possessed Assault Weapon on Unh Campus Is SentencedRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that WILLIAM DONG, 23, of Fairfield, was sentenced today by U.S. District Judge Robert N. Chatigny in Hartford to five years of probation for transporting an assault weapon into Connecticut in violation of federal law.
According to court documents and statements made in court, in September 2013, DONG traveled to Pennsylvania, purchased a Bushmaster model XM-15-E2S, .223 caliber semi-automatic rifle and transported the rifle back to Connecticut. This firearm is considered a prohibited assault weapon under Connecticut state law.On December 3, 2013, West Haven Police arrested DONG in the vicinity of the University of New Haven (UNH) after he was found in possession of two handguns on his person, and the Bushmaster rifle, which was seized from his nearby car. DONG, a UNH student, told police that he had purchased the rifle from a seller in Pennsylvania in September 2013 through an advertisement placed on www.armslist.com.
Although it is not unlawful under federal law for an individual, who is not a prohibited person, to possess this Bushmaster firearm, it is a federal violation for an individual to purchase this firearm outside of Connecticut and travel into the state with it, since it is a prohibited firearm under Connecticut state law.
DONG has been detained since his arrest. He has stated that he possessed the firearms out of concern for his safety and the safety of his fellow UNH students.
DONG pleaded guilty to the federal charge on November 6, 2014. He also previously pleaded guilty in Milford Superior Court to state firearms offenses related to the December 2013 incident in West Haven, and has been sentenced to eight years of incarceration, execution suspended after two years, and five years of probation.
In the federal case, DONG faced a sentencing guideline range of six to 12 months of imprisonment. Instead of imposing a sentence of incarceration, and which would be followed by a term of supervised of up to three years, Judge Chatigny imposed a five-year term of probation, the maximum allowed under the law. Judge Chatigny agreed with the government’s position that DONG’s state term of incarceration is sufficient, but that a longer period of federal supervision is necessary to insure the safety of the community.
As special conditions of probation, Judge Chatigny ordered that DONG cannot possess any firearms or ammunition, associate with individuals in possession of firearms or go to any shooting ranges. He also must submit to mental health counseling.
“A sentence of five years of probation with mental health counseling is an appropriate resolution to this case, as it will provide Mr. Dong with needed federal supervision,” stated U.S. Attorney Daly. “We want to thank the conscientious citizen who first alerted law enforcement that an individual was in possession of a powerful and potentially dangerous firearm. We also want to acknowledge the rapid response of the West Haven Police and University of New Haven Police, which quickly resolved this unsettling situation.”
This matter was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, West Haven Police Department, University of New Haven Police Department and Connecticut State Police. The case was prosecuted by Assistant U.S. Attorney Robert M. Spector.
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[email protected]Connecticut Hedge Fund Adviser Sentenced to 13 Years in Federal Prison for Running Massive Ponzi SchemeRead the Press Release
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FRANCISCO ILLARRAMENDI, 45, formerly of New Canaan, was sentenced today by U.S. District Judge Stefan R. Underhill in Bridgeport to 156 months of imprisonment, followed by three years of supervised release, for orchestrating a Ponzi scheme that defrauded investors and creditors of hedge funds he managed out of hundreds of millions of dollars, and for obstructing the ensuing investigation of his conduct.
“For more than five years, Francisco Illarramendi’s severely misguided attempt to conceal an initial loss of $5 million ballooned into an elaborate fraud scheme that caused investors and creditors to lose hundreds of millions of dollars,” stated First Assistant U.S. Attorney Michael J. Gustafson. “Through it all, he still managed to live well, receiving more than $20 million in personal benefits. I want to thank our partners at the FBI and SEC for unravelling this complex scheme, and acknowledge the efforts of the court-appointed receiver who has recovered more than $300 million that will be distributed to the victims.”
“Mr. Illarramendi violated his fiduciary duties by swindling millions from investors,” stated Patricia M. Ferrick, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation. “This case sends a clear message that no one is above the law, least of all those in the securities industry.”
On March 7, 2011, ILLARRAMENDI pleaded guilty to two counts of wire fraud, one count of securities fraud, one count of investment advisor fraud, and one count of conspiracy to obstruct justice, to obstruct an official proceeding and to defraud the U.S. Securities and Exchange Commission (SEC).
According to court documents and statements made in court, in 2005, ILLARRAMENDI founded and became a partner in Highview Point Partners (“HVP”) and began acting as an investment adviser to certain hedge funds. HVP was registered with the SEC as an investment advisor and eventually relocated from New York City to Stamford. In 2006, ILLARRAMENDI founded, and became a partner in, Michael Kenwood (“MK”), which was also located in Stamford, but was not registered with the SEC. In late 2005, one hedge fund he advised lost approximately $5 million of the money he was charged with investing. Rather than disclose to his investors the truth about the losses incurred, ILLARRAMENDI concealed this information by engaging in a scheme to defraud and mislead his investors and creditors. As a result of the scheme, the hedge funds and related entities managed and advised by ILLARRAMENDI had outstanding liabilities that greatly exceed the true value of their assets, causing the funds’ investors, creditors and service providers to lose more than $700 million.
As part of the scheme to defraud investors, creditors and, ultimately, the SEC, ILLARRAMENDI created fraudulent documents, including a bogus debt instrument and a phony letter purporting to have been issued by an investment bank, as well as a fictitious asset verification letter falsely representing that one of the hedge funds, the Short Term Liquidity Fund (“STLF”), had at least $275 million in credits as a result of outstanding loans, when ILLARRAMENDI and others knew it did not have any such credits. In addition, ILLARRAMENDI misled investors, creditors and the SEC about the true performance of the funds, the assets under management by the funds and the transactions being conducted by the funds and related entities. At times, ILLARRAMENDI used money provided by new investors to the funds to pay out the returns he promised to earlier investors, made false representations to his investors and creditors in an effort to obtain new investments from them and to prevent them from seeking to liquidate their investments, improperly commingled the investments in each individual hedge fund with investments in the other hedge funds, and engaged in transactions that were not in the best interests of the funds.
In order to keep his fraud hidden, and to secure an investment of approximately $100 million, ILLARRAMENDI paid $3.4 million in bribes to two officials of the Venezuelan state-owned oil company, Petroleos de Venezuela, S.A. (“PDVSA”). ILLARRAMENDI also paid a Venezuelan accountant, Juan Carlos Guillen Zerpa, and a purported Florida businessman, Juan Carlos Horna Napolitano, $1.25 million to assist him in the creation of the fictitious asset verification letter that falsely represented that STLF had at least $275 million in credits as a result of outstanding loans. ILLARRAMENDI used the letter in an attempt to mislead and deceive the SEC regarding whether there was sufficient capital and credit to protect the investors of STLF.
ILLARRMENDI personally obtained more than $20 million during the course of the scheme, and used approximately $5 million of the funds to construct a home in New Canaan.
On January 14, 2011, the SEC filed a civil action seeking, among other things, to enjoin ILLARRAMENDI and MK-related entities from violating the federal securities laws and to submit an accounting of investor funds. Subsequent to the filing of the SEC civil action, U.S. District Judge Janet Bond Arterton appointed, and sought input from, business advisers and a court-appointed receiver to ascertain the assets and liabilities of the hedge funds affiliated with MK, among other tasks.
To date, the court-appointed receiver has recovered more than $300 million of the funds that were lost, including the vast majority of the bribe payments. The receiver also has sold ILLARRAMENDI’s New Canaan residence for approximately $3 million.
Judge Underhill will issue a restitution order after further court proceedings.
ILLARRAMENDI has been detained since January 25, 2013, after his bond was revoked, in part because he had failed to disclose to the Court that he had received and spent a Connecticut state tax refund of more than $630,000 while he was awaiting sentencing.
Guillen and Horna both pleaded guilty to conspiring to obstruct an SEC proceeding, received prison terms of 14 months and forfeited the $1.25 million they received from ILLARRAMENDI.
This matter was investigated by the Federal Bureau of Investigation with the assistance of the U.S. Securities and Exchange Commission, Boston Regional Office, and Internal Revenue Service – Criminal Investigation Division.
The case was prosecuted by Senior Litigation Counsel Richard J. Schechter and Assistant U.S. Attorney Paul A. Murphy, with the assistance of the U.S. Attorney’s Office for the District of Massachusetts.
Citizens are encouraged to report any financial fraud schemes by calling, toll free, 855-236-9740, or by sending an email to [email protected].
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[email protected]New York Man Involved in Danbury Home Invasion Drug Robberies Sentenced to 7 Years in PrisonRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that on Friday, January 23, SCOTT MYRIE, also known as “Venom,” 27, of Bedford Hills, N.Y., was sentenced by U.S. District Judge Stefan R. Underhill in Bridgeport to 84 months of imprisonment, followed by three years of supervised release, for his participation in two Danbury-area violent home invasion robberies of illegal drugs and drug trafficking proceeds.
According to court documents and statements made in court, in January 2013 the Danbury Police Department began investigating a narcotics trafficking network that maintained a series of drug distribution locations, known as trap houses, in Danbury, out of which members of the organization sold crack and heroin. The organization also rented hotel rooms where they packaged and distributed narcotics. During the investigation, law enforcement learned that the individuals who headed the drug trafficking ring had organized and committed armed home invasion robberies of marijuana dealers.
MYRIE participated in home invasion robberies on January 30 and February 18, 2013. During both of these robberies, and a third robbery in which MYRIE did not participate, several men wearing masks and armed with firearms forced entry into the residence of a known marijuana dealer. Once inside, the perpetrators attempted to or did steal marijuana and cash. In each instance, the perpetrators pistol whipped a victim and threatened to kill others within the home.
MYRIE was armed with a .32 caliber handgun during both of the robberies in which he participated, and children were present in both homes. During the robbery on February 18, MYRIE struck a male victim in the head with the handgun repeatedly before dropping the gun during a struggle. Investigators subsequently recovered the gun and found that it was fully loaded.
MYRIE has been detained since his arrest on October 16, 2013. On August 22, 2014, he pleaded guilty to one count of interference with commerce by robbery and one count of attempted interference with commerce by robbery.
This matter has been investigated by the Drug Enforcement Administration’s New Haven Task Force and the Danbury Police Department. The DEA Task Force includes personnel from the New Haven, Hamden, West Haven, North Haven, Branford, Ansonia and Meriden Police Departments. The case is being prosecuted by Assistant U.S. Attorneys Tracy Dayton and Vanessa Richards.
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[email protected]New York Man Convicted of Sex Trafficking of MinorsRead the Press Release
Follow @USAO_CTDeirdre M. Daly, United States Attorney for the District of Connecticut, and Patricia M. Ferrick, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation, announced that a jury in Hartford has found EDWARD THOMAS, also known as “Fire,” 40, of New York, guilty of the sex trafficking of minors. The trial before U.S. District Judge Robert N. Chatigny began on January 15.
According to the evidence at trial, in September 2012, THOMAS, a New York-based pimp, answered an Internet prostitution advertisement for a 17-year-old girl (“MV1”) in Oregon. Over the next month, THOMAS recruited and enticed MV1 to travel to New York to work for him. MV1 eventually agreed and traveled to New York with a second girl (“MV2”), who was 16 at the time, using bus tickets purchased by THOMAS. THOMAS discussed with both MV1 and MV2 that they would be prostituting for him in New York and Connecticut.
After MV1 and MV2 arrived in New York, THOMAS and the two minor girls went immediately to a hotel in Milford, Connecticut, where they met Kayla Walters, THOMAS’ co-defendant, and posted prostitution advertisements. THOMAS knew that MV1 and MV2 were under the age of 18. In Milford, MV1 and MV2 saw customers for commercial sex acts at the direction of THOMAS. While MV2 escaped from a hotel room window after several hours, MV1 continued to work for THOMAS for about a month, turning over all of the money she earned in prostitution to THOMAS. When MV1 attempted to leave, THOMAS forcibly restrained her. Ultimately, MV1 was recovered for the first time by the FBI and local police in Milford on November 8, 2012. Law enforcement seized nearly $4,000 in cash from THOMAS during the first recovery, along with several computers and cellular phones.
THOMAS recruited MV1 a second time in July 2013 and again paid for her travel from Oregon to the East Coast. After THOMAS sent Walters and MV1 to Connecticut to make money for him, the FBI and local police again recovered MV1 from a hotel in Milford.
“This defendant preyed on the vulnerabilities of two girls whom he lured 3000 miles away from their homes,” stated U.S. Attorney Daly. “The U.S. Attorney Office is committed to prosecuting individuals who manipulate minors into committing sexual acts – often under the threat of violence – and profit handsomely from this illegal and reprehensible conduct. I thank the FBI for their vigilance in investigating these crimes, which have resulted not only in criminal convictions, but in the rescue of numerous girls and young women from terrible environments.”
“Human trafficking, especially for the purpose of underage prostitution, is a heinous crime,” stated FBI Special Agent in Charge Ferrick. “The FBI will continue to work with our law enforcement partners to aggressively pursue these criminals and hold them accountable.”
THOMAS was convicted of one count of conspiracy to commit sex trafficking of a minor and two counts of sex trafficking of a minor. Judge Chatigny scheduled sentenced for April 17, 2015, at which time THOMAS faces a mandatory minimum term of imprisonment of 10 years and a maximum term of imprisonment of life.
On November 10, 2014, Walters pleaded guilty to one count of conspiracy to commit sex trafficking of a minor. She awaits sentencing.
THOMAS and Walters have been detained since their arrests on February 28, 2014.
THOMAS’ criminal history includes a 2007 conviction in New Jersey for promoting prostitution with a child under the age of 18.
This matter is being investigated by the Federal Bureau of Investigation and the Connecticut Child Exploitation Task Force, which includes federal, state and local law enforcement agencies. The Stratford and Milford Police Departments have assisted the investigation.
The Connecticut Child Exploitation Task Force, which is housed at the main FBI office in New Haven, investigates crimes against children occurring over the Internet, and provides computer forensic review services for participating agencies. For more information about the Task Force, or to report child exploitation crimes, please contact the FBI at 203-777-6311.
The case is being prosecuted by Assistant U.S. Attorneys David E. Novick and Sarala V. Nagala.
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[email protected]Woodbridge Attorney Sentenced to Prison for Failing to Pay Nearly $400k in Federal Income TaxesRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that JERRY GRUENBAUM, 59, of Woodbridge, was sentenced today by U.S. District Judge Vanessa L. Bryant in Hartford to six months of imprisonment, followed by one year of supervised release, for failing to pay taxes on more than $1.3 million in income over a six-year period.
According to court documents and statements made in court, from 2005 to 2010, GRUENBAUM, an attorney, failed to report approximately $1,310,100 in taxable income on his federal tax returns. For the 2005, 2006 and 2007 tax years, GRUENBAUM filed tax returns that he knew significantly understated his actual taxable income, and for the 2008, 2009 and 2010 tax years, he failed to file any tax returns. Through this scheme, GRUENBAUM failed to pay $394,226 in additional tax due.
GRUENBAUM also took steps to make it difficult for the IRS to determine his true income, including calculating the gross receipt figures for one of his businesses by reviewing just one of a number of the business’s bank accounts that he knew had reportable income. He also utilized corporate bank accounts to pay his personal expenses, and received compensation for services rendered from at least three different corporations in the form of stock shares and salaries, and failed to report this income on his tax returns.
GRUENBAUM is required to pay approximately $877,646 in back taxes, penalties and interest.On July 15, 2014, GRUENBAUM pleaded guilty to two counts of filing a false federal tax return.
This matter was investigated by the Internal Revenue Service – Criminal Investigation Division. The case was prosecuted by Assistant U.S. Attorney Christopher W. Schmeisser.
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[email protected]Waterbury Man Pleads Guilty to Federal Firearm and Narcotics OffensesRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that BRANDON SAPP, 28, of Waterbury, pleaded guilty today before U.S. District Judge Janet Bond Arterton in New Haven to one count of possession of narcotics with the intent to distribute, and one count of possession of a firearm in furtherance of a drug trafficking crime.
According to court documents and statements made in court, Watertown Police observed SAPP drive up to a residence on Franklin Avenue and conduct what appeared to be a narcotics transaction with another individual standing outside of the home. When officers attempted to stop his car, SAPP pulled away at a high rate of speed. In the ensuing pursuit, SAPP struck a police vehicle, exited his car and fled on foot. He was apprehended a short time later.
A search of the route through which SAPP had fled revealed a 9mm semi-automatic pistol, and a search of his car revealed three 9mm firearm magazines, 15 rounds of 9mm ammunition and 375 baggies heroin marked “Obsession.” SAPP also possessed approximately $990 in cash.
Judge Arterton scheduled sentencing for April 15, 2015, at which time SAPP faces a maximum term of imprisonment of 20 years for the narcotics offense, and a consecutive term of imprisonment of at least five years for the firearm offense.
This matter has been investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Watertown Police Department. The case is being prosecuted by Assistant U.S. Attorney Gabriel J. Vidoni.
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[email protected]New London Man Pleads Guilty to Federal Charge Related to 2012 HomicideRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that ANDREW AVILES, 27, of New London, pleaded guilty today before U.S. District Judge Vanessa L. Bryant in Hartford to a federal assault offense stemming from the September 2012 homicide of Javier Reyes, 36, of New London.
According to court documents and statements made in court, AVILES was an associate of a criminal organization that distributed marijuana, cocaine and other narcotics from the “Green Garages,” a series of garage bays located as 12/14 Walker Street in New London. In the summer of 2011, the leader of the Green Garages organization was the intended victim of a murder-for-hire plot orchestrated by former members of his enterprise in an attempt to take over narcotics distribution at the Green Garages. It is alleged that the leader of the organization orchestrated the assault of Javier Reyes to maintain his leadership position. AVILES and Jose Rosado, Jr. were hired to carry out the assault of Reyes in exchange for cash.
On the evening of September 12, 2012, Reyes was stabbed multiple times outside of his apartment at 187 Huntington Street in New London and died a short time later. He also had blunt force trauma to the back of his head.
Video surveillance at the time of the attack shows AVILES and Rosado, carrying a bat, creeping toward Reyes and then running away from him about 15 seconds later.
AVILES today admitted that he stabbed Reyes during the assault.
AVILES pleaded guilty to violating the Travel Act by using a facility in interstate commerce, namely a cellular telephone, with the intent to commit a crime of violence in furtherance of an unlawful activity, and thereafter committed the crime of violence.
At sentencing, AVILES faces a maximum term of imprisonment of life. A sentencing date has not been set.
On July 22, 2014, Rosado, 20, of New London, pleaded guilty to a related charge and also awaits sentencing.
AVILES and Rosado are currently detained.
The alleged leader of the Green Garages organization and the individual who allegedly recruited AVILES and Rosado have been indicted as a result of this investigation. U.S. Attorney Daly stressed that an indictment is not evidence of guilt. Charges are only allegations, and each defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This matter is being investigated by the New London Police Department and the Federal Bureau of Investigation, with the assistance of the Connecticut State Police’s Eastern District Major Crime Squad, the Connecticut Department of Correction, Homeland Security Investigations, the U.S. Secret Service and the New London State’s Attorney’s Office. The case is being prosecuted by Assistant U.S. Attorneys Anthony Kaplan and Sarah Karwan, and Senior Assistant State’s Attorney Paul Narducci.
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[email protected]Employee of Deep River Gun Manufacturer Pleads Guilty to Federal Firearms ViolationsRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that RICHARD CUMMINGS, 43, of East Haddam, pleaded guilty yesterday in Bridgeport federal court to violating federal firearms laws. CUMMINGS worked as a manager at Tri-Town Plastics (“Tri-Town”), a former federally-licensed firearms manufacturer located in Deep River.
According to court documents and statements made in court, in 2011 and 2012, Tri-Town had a contract with Smith and Wesson to manufacturer firearm frames at its Deep River facility. In February 2012, after the Plainfield Police Department seized a Smith and Wesson 9 millimeter handgun from a residence, the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) learned that Smith and Wesson had no record of the handgun ever having been manufactured. According to Tri-Town’s records, the handgun had been scrapped in March 2011. At that time, ATF was preparing to conduct a routine inspection of Tri-Town to determine whether to renew their federal license to manufacture firearms. Tri-Town had also been inspected in 2009 and been directed by ATF to address some record-keeping issues discovered during that inspection. When CUMMINGS and a Tri-Town employee who was his subordinate discovered that there were approximately 23 firearms missing from their inventory, rather than report them as missing, CUMMINGS directed the employee to falsely list them as “scrapped” in Tri-Town’s acquisition and disposition records so that ATF would not learn that they were missing and would renew Tri-Town’s license.
In pleading guilty, CUMMINGS admitted that it was his decision to list the firearms as scrapped, at no point prior to the February 2012 Plainfield seizure did he report these firearms as missing or lost and, in February 2012, he failed to correct Tri-Town’s acquisition and disposition records to show the missing firearms.
Later, it was learned that five of the 23 firearms were not, in fact, missing, so that the total number of unaccounted firearms remains 17 (not including the one seized in Plainfield).
CUMMINGS pleaded guilty before U.S. District Judge Stefan R. Underhill to one count of making a false entry in a firearms manufacturer’s acquisition and disposition records in March 2011, one count of failing to file a theft/loss report between March 2011 and February 2012, and one count of failing to maintain a firearms manufacturer’s acquisition and disposition records in February 2012. The maximum penalty on each of these misdemeanor charges is one year of imprisonment, five years of probation and a $100,000 fine.
Sentencing is scheduled for April 15, 2015.
Smith and Wesson purchased Tri-Town in May 2014 and now owns the facility.
This matter was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, with the assistance of the Plainfield Police Department. The case is being prosecuted by Assistant U.S. Attorneys Robert M. Spector and Vanessa Richards.
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[email protected]U.S. Attorney Names New Civil Division AppointmentsRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced two new appointments within the Office’s Civil Division.
Assistant U.S. Attorney Richard M. Molot has been named Chief of the Civil Division’s Affirmative Enforcement Unit, which pursues claims on behalf of the United States in cases involving health care fraud, defense contractor fraud, drug diversion and forfeitures, as well as civil rights and environmental violations.
Mr. Molot joined the U.S. Attorney’s Office in Connecticut in 2000 after serving as an AUSA in the Eastern District of New York for six years. In Connecticut, Mr. Molot has served as the Civil Health Care Fraud Coordinator, investigating and prosecuting False Claims Act cases involving Medicare and Medicaid fraud, and coordinating investigations with various federal and state agencies responsible for protecting federal health care programs. Prior to joining the Justice Department, Mr. Molot was in private practice for four years, and served as a law clerk to U.S. District Judge John M. Cannella in the Southern District of New York. He is a 1985 graduate of Union College and a 1988 graduate of Fordham University School of Law.
Assistant U.S. Attorney Michelle McConaghy has been named Chief of the Civil Division’s Defensive Unit, which defends claims filed against the United States, including tort, medical malpractice, employment discrimination, immigration and foreclosures. The Defensive Unit also defends claims brought against individual federal employees (“Bivens” claims).
Since joining the U.S. Attorney’s Office in 2007, Ms. McConaghy has primarily handled matters involving immigration law as well as defensive civil rights and tort litigation. Prior to her time in the Office, Ms. McConaghy served as a law clerk to U.S. Magistrate Judge Holly B. Fitzsimmons in Bridgeport, and was a paralegal in the U.S. Attorney’s Office for the District of Rhode Island for 10 years. She is a 1999 graduate of Roger Williams University and a 2005 graduate of Roger Williams University School of Law.
Assistant U.S. Attorney John B. Hughes remains the longstanding Chief of the Civil Division.
“Michelle McConaghy and Rick Molot are experienced and highly-effective civil litigators well-respected inside our Office and within the broader legal community,” stated U.S. Attorney Daly. “Enthusiastic and dedicated public servants, they also possess excellent judgment. We thank them for stepping up to take on these leadership responsibilities. Together with John Hughes, our revered Civil Chief, they will be a top notch team.”
The Civil Division also has a Financial Litigation Unit, headed by Assistant U.S. Attorney Christine Sciarrino, which is responsible for collecting debts owed to the United States.
Over the last few years, the Civil Division has prioritized its Civil Rights enforcement program which brings civil rights actions to enforce federal statutes prohibiting discrimination on the basis of race, color, sex, disability, religion, familial status and national origin and to recover damages for victims of civil rights violations. The majority of the civil rights cases are brought to enforce the Americans with Disabilities Act (ADA), the Fair Housing Act (FHA), the Religious Land Use and Institutionalized Persons Act (RLUIPA) and the Civil Rights of Institutionalized Persons Act (CRIPA).
The U.S. Attorney’s Office, which also enforces federal criminal laws in Connecticut, is composed of approximately 64 Assistant U.S. Attorneys and approximately 60 staff members at offices in New Haven, Hartford and Bridgeport.
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[email protected]Two Men Charged with Armed Robbery of Windsor BankRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, and Patricia M. Ferrick, Special Agent in Charge of the Federal Bureau of Investigation, today announced that DAVID JOHNSON, 27, of Enfield, and ODAIN JOHNSON, 21, of Hartford, have been charged by federal criminal complaint with the armed robbery of the First Niagara Bank in Windsor on January 10, 2015.
According to the criminal complaint, which was unsealed today, on January 10, 2015, at approximately 9:15 a.m., two masked men, at least one of whom brandished a firearm, entered the First Niagara Bank at 2133 Poquonock Avenue in Windsor. The two men vaulted the teller counter, directed two bank employees to the bank vault and ordered one of the employees to open the vault. Once inside the vault, the men ordered the bank employees to the ground and took $81,530 from the vault. The men also ordered bank employees to open teller drawers and proceeded to take an additional amount of money from the drawers.
The complaint also alleges that a customer walked into the bank during the robbery. One of the masked men pointed a gun at the customer, ordered him to the ground and told him not to look up. After exiting the bank, the men confronted a second customer who was about to enter the bank. One of the men pointed a gun at the customer and stated “If you say anything, we’ll shoot you….”
The complaint further alleges that, while investigating the robbery, Windsor Police were contacted by East Windsor Police who were investigating similar bank and credit union robberies in East Windsor and Glastonbury. East Windsor Police had recently obtained an arrest warrant for DAVID JOHNSON with respect to the robbery of the Nutmeg State Federal Credit Union in East Windsor on July 21, 2014.
After further investigation, on January 10 at approximately 9:45 p.m., law enforcement executed a search warrant at DAVID JOHNSON’s Enfield residence and found a total of $81,946 in cash, most of which was bound by First Niagara Bank strapping that was initialed by one of victim bank employees. Investigators also found and seized other items allegedly used during the robbery earlier that day, as well as a .380 caliber semi-automatic handgun with a fully-loaded magazine.
DAVID JOHNSON was arrested at that time on the East Windsor warrant. He currently is detained in state custody.
On January 17, ODAIN JOHNSON was arrested in Lewiston, Maine, on the federal criminal complaint. He also is detained.
The charge of armed bank robbery carries a maximum term of imprisonment of 20 years.
The investigation is ongoing.
U.S. Attorney Daly stressed that a complaint is only a charge and is not evidence of guilt. Charges are only allegations, and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt.
This matter is being investigated by the FBI and the Windsor, East Windsor and Glastonbury Police Departments, with the assistance of the Enfield Police Department, the Capital Region Emergency Services Team (CREST) and the Maine State Police. The case is being prosecuted by Assistant U.S. Attorneys Deborah R. Slater and Douglas P. Morabito.
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[email protected]New York Man Sentenced to More Than 8 Years in Prison for Supplying New Haven Drug DealerRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that JOHNNY DE LOS SANTOS, also known as “Na-Na,” 30, of the Bronx, N.Y., was sentenced today by Senior U.S. District Judge Ellen Bree Burns in New Haven to 97 months of imprisonment, followed by five years of supervised release, for trafficking cocaine and heroin into Connecticut.
According to court documents and statements made in court, this matter stems from “Operation Bloodline,” a joint law enforcement investigation targeting narcotics trafficking and gang violence in the Dwight-Kensington and Fair Haven sections of New Haven. Led by the DEA New Haven Task Force and the New Haven and Hamden Police Departments, the year-long investigation included the use of court-authorized wiretaps on numerous telephones, extensive physical surveillance, controlled purchases of narcotics, execution of search warrants, and seizures of narcotics and firearms. Approximately 100 individuals were convicted of federal charges as a result of the investigation.
The investigation revealed that Kevin Wilson, also known as “Nature,” operated a large-scale narcotics trafficking operation in greater New Haven. DE LOS SANTOS was Wilson’s primary source for narcotics. Between June 2011 and January 2012, DE LOS SANTOS supplied Wilson with more than one kilogram of heroin and more than one kilogram of cocaine. DE LOS SANTOS also supplied Wilson’s associates with narcotics.
DE LOS SANTOS was arrested on July 12, 2012. On December 5, 2012, he pleaded guilty to one count of conspiracy to possess with intent to distribute, and to distribute, one kilogram or more of heroin and five kilograms or more of cocaine.
DE LOS SANTOS has been detained since March 11, 2014, when his bond was revoked after an investigation revealed that he had distributed an additional 2.5 kilograms of heroin while awaiting sentencing.
Wilson has pleaded guilty and awaits sentencing.
This matter was investigated by the Drug Enforcement Administration’s New Haven Task Force, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the New Haven, Hamden, West Haven, North Haven, Branford, Ansonia and Meriden Police Departments. The United States Marshals Service, the Connecticut State Police, the Connecticut Department of Correction, Parole and Community Services and the Milford, Hartford, New Britain, North Branford and Stratford Police Departments provided valuable assistance to the investigation.
This case is being prosecuted by Assistant U.S. Attorneys S. Dave Vatti and Marc Silverman.
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[email protected]West Haven Couple Charged with Distributing HeroinRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that ALYSSA JELLIFFE, 21, and CHRISTOPHER FOGLER, 29, both of West Haven, have been charged by criminal complaint with conspiring to distribute heroin.
JELLIFFE and FOGLER were arrested on Friday, January 16, and are currently detained. Detention hearings are scheduled for January 23 in Bridgeport federal court.
According to the criminal complaint, on January 12, 2015, a 39-year-old male died from an apparent heroin overdose at a residence in Milford. The investigation, which included analysis of text messages captured from the decedent’s cellular telephone, revealed that JELLIFFE and FOLGLER sold the decedent $170 worth of heroin on the evening of January 11, 2015.
On January 16, 2015, a court-authorized search of JELLIFFE and FOGLER’s residence revealed approximately 10 bags of heroin and assorted drug paraphernalia, including a digital scale, razor blades and cut straws.
JELLIFFE and FOGLER are each charged with conspiracy to possess with intent to distribute, and to distribute, heroin. The charge carries a maximum term of imprisonment of 20 years.
U.S. Attorney Daly stressed that a complaint is only a charge and is not evidence of guilt. Charges are only allegations, and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt.
This ongoing investigating is being conducted by the Drug Enforcement Administration’s Bridgeport High Intensity Drug Trafficking Area (HIDTA) Task Force and the Milford Police Department. The case is being prosecuted by Assistant U.S. Attorney Alina P. Reynolds.
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[email protected]New Haven Man Involved in Marriage Fraud Scheme Is SentencedRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that SYED NAQSHBAND, 33, of New Haven, was sentenced today by U.S. District Judge Vanessa L. Bryant in Hartford to three months of home confinement and three years of probation for his role in a marriage fraud scheme.
According to court documents and statements made in court, between July and August 2013, NAQSHBAND persuaded a female friend, who is a U.S. citizen, to travel with him to Pakistan and marry his nephew so that the nephew, a citizen of Pakistan, could enter the U.S. NAQSHBAND offered to help pay the woman’s travel expenses and assured her she would not have to live with his nephew once they returned to the U.S.
The scheme was disrupted just before the planned travel when the woman, accompanied by NAQSHBAND, applied for a U.S. Passport and the U.S. Passport Office alerted the FBI of certain suspicious observations.
On October 31, 2014, NAQSHBAND pleaded guilty to one count of conspiracy to commit marriage fraud.
This matter was investigated by the Federal Bureau of Investigation Joint Terrorism Task Force, the Bureau of Diplomatic Security, the U.S. Passport Office, Homeland Security Investigations and the U.S. Citizenship and Immigration Service’s Office of Fraud Detection and National Security. The case was prosecuted by Assistant U.S. Attorney Henry K. Kopel.
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[email protected]Former Plymouth Finance Director Arrested; Charged with Embezzling More Than $800kRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that DAVID J. BERTNAGEL, 41, of Thomaston, was arrested today on a federal criminal complaint charging him with embezzling more than $800,000 from the Town of Plymouth.
BERTNAGEL was arrested this morning at his residence. He appeared before U.S. Magistrate Judge Donna F. Martinez in Hartford and was released on a $250,000 bond.
According to the criminal complaint, from July 2014 to October 2014, BERTNAGEL was employed as the Finance Director for the Town of Plymouth. For approximately six years prior to that time he was a part-time employee in the Town’s Finance Department. From approximately October 2011 through October 2014, it is alleged that BERTNAGEL issued 207 checks totaling approximately $808,030 from the Town’s payroll account to himself. BERTNAGEL used the embezzled funds to make mortgage payments, pay credit card bills, fund home improvement projects and purchase more than $100,000 in coins, stamps and other collectibles. He also converted more than $182,000 of the stolen funds by way of cashed checks, ATM withdrawals and money orders.
The complaint also alleges that BERTNAGEL did not file a tax return with the Internal Revenue Service for the 2011 tax year and, although he did file tax returns for the 2012 and 2013 tax years, he failed to report any of his embezzled income.
Since 2011, Plymouth has received approximately $450,000 in grant awards from the U.S. Department of Health and Human Services.
The criminal complaint charges BERTNAGEL with theft from a local government receiving federal funds, which carries a maximum term of imprisonment of 10 years.
U.S. Attorney Daly stressed that a complaint is only a charge and is not evidence of guilt. Charges are only allegations, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This matter is being investigated by the Federal Bureau of Investigation, Internal Revenue Service – Criminal Investigation Division, U.S. Postal Inspection Service, U.S. Department of Housing and Urban Development – Office of Inspector General and U.S. Department of Health and Human Services – Office of Inspector General. The case is being prosecuted by Assistant U.S. Attorney Christopher M. Mattei.
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[email protected]Ridgefield Physician Pleads Guilty to Health Care FraudRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that DAVID LESTER JOHNSTON, 46, of Ridgefield, pleaded guilty today in Hartford federal court to committing health care fraud.
According to court documents and statements made in court, JOHNSTON is an osteopathic physician who operates Osteopathic Wellness Center, LLC, in Ridgefield. In pleading guilty, JOHNSTON admitted that he engaged in a scheme to defraud Medicare and several private health insurance companies by submitting claims for osteopathic and physical therapy services that he did not perform, and by misrepresenting the nature of the services that were performed.
JOHNSTON specifically admitted that he submitted claims in connection with services rendered by a massage therapist, but falsely described the services rendered and falsely stated that he himself had rendered the services.
JOHNSTON is scheduled to be sentenced by U.S. District Judge Robert N. Chatigny on April 10, 2015, at which time he faces a maximum term of imprisonment of 10 years. As part of the resolution of this case, JOHNSTON has agreed to enter into a civil settlement with the government and will pay $270,528 to settle federal civil claims arising from his conduct.
This matter has been investigated by the Office of the Inspector General of the U.S. Department of Health and Human Services and the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorneys Christopher Mattei, Heather Cherry and Richard Molot.
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[email protected]Madison Gallery Owner Sentenced to 57 Months in Prison for Selling Fraudulent ArtworkRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that DAVID J. CRESPO, 60, of Guilford, was sentenced today by Senior U.S. District Judge Ellen Bree Burns in New Haven to 57 months of imprisonment, followed by three years of supervised release, for selling fraudulent artwork.
According to court documents and statements made in court, CRESPO was an art dealer who operated the Brandon Gallery in Madison. Over the course of several years, CRESPO defrauded customers by falsely representing that artwork he sold were original pieces by Pablo Picasso and original signed lithographs by Marc Chagall. As part of the scheme, CRESPO forged numerous documents in order to provide “authentication” or provenances of the fakes to his victims.
On September 3, 2013, CRESPO pleaded guilty to one count of mail fraud stemming from the sale of an imitation Marc Chagall lithograph.
The investigation revealed that CRESPO obtained reproductions of original Chagall lithographs, but represented to potential customers that they were, in fact, original lithographs that had been produced through an artistic lithographic method, and under the direction and authority of Marc Chagall.
In January 2010, CRESPO met with an undercover FBI agent at Brandon Gallery. During the course of the conversation, which was recorded, CRESPO and the agent discussed a lithograph known as “The Presentation of Chloe,” which CRESPO represented, among other things, was an “original lithograph” that was part of a limited edition collection made from “stone plates” from which multiple impressions were made from “the same plate.” The agent agreed to purchase the purported lithograph for $2,000.
In May 2010, CRESPO shipped the purported lithograph along with a “Certificate of Authenticity,” which valued the piece at $12,750 “for insurance purposes,” stated that piece was “hand signed by Chagall in crayon after the artist personally examined this particular example,” and represented that “[t]his work came from the collection of Richard Riskin, a longtime friend of the artist.”
In fact, CRESPO had not obtained the purported Chagall lithograph from the estate of Richard Riskin, as no such person existed, and CRESPO knew that the piece was not a limited edition original lithograph manufactured under the artist’s direction using stone plates, but was a photo-mechanical production that was removed from a common edition book.
In November 2010, the FBI conducted a search of the Brandon Gallery and found packages of Chagall prints and practiced Chagall signatures.
The investigation revealed that CRESPO defrauded at least 10 victims out of a total of at least $400,000. Judge Burns will issue a restitution order with 90 days.
On April 3, 2012, CRESPO was arrested on a criminal complaint. He has been detained since December 31, 2014, when he was found to have violated the conditions of his release and his bond was revoked.
This matter was investigated by the Federal Bureau of Investigation and the Madison Police Department. The case was prosecuted by Assistant U.S. Attorneys Anthony E. Kaplan and Liam Brennan.
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[email protected]State Employee Pleads Guilty to Tax EvasionRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that MICHAEL CARTER, 51, of New Haven, pleaded guilty today before U.S. District Judge Alvin W. Thompson in Hartford to one count of tax evasion.
This matter stems from an Internal Revenue Service investigation into high income State of Connecticut employees who had little or no federal withholding taken out of their paychecks and who failed to file income tax returns. The investigation revealed that certain state employees submitted fraudulent W-4 forms claiming numerous exemptions and had no money withheld from their wages.
According to court documents and statements made in court, CARTER has been employed by the Connecticut Department of Mental Health and Addiction Services, working as a nurse at the Connecticut Valley Hospital in Middletown since 2005. CARTER submitted a false Form W-4 to the state indicating that he had 99 exemptions and was exempt from tax withholding. As a result, no money was withheld from his wages. During the 2010 through 2012 tax years, CARTER paid no federal income taxes on more than $282,000 in income he received, resulting in a federal tax loss of $53,344.
Judge Thompson scheduled sentencing for April 14, 2015, at which time CARTER faces a maximum term of imprisonment of five years and a fine of up to $250,000. He also is required to pay back taxes, plus interest and penalties.
CARTER was charged by indictment on April 9, 2014, and is currently released on bond.
This ongoing investigating is being conducted by the Internal Revenue Service – Criminal Investigation Division. The case is being prosecuted by Assistant U.S. Attorney Susan Wines.
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[email protected]New Haven Narcotics Dealer Sentenced to 8 Years in Federal PrisonRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that RICHARD ANDERSON, also known as “Mayut” and “Porter,” 28, of New Haven, was sentenced today by Senior U.S. District Judge Ellen Bree Burns in New Haven to 96 months of imprisonment, followed by five years of supervised release, for distributing narcotics.
According to court documents and statements made in court, this matter stems from “Operation Bloodline,” a joint law enforcement investigation targeting narcotics trafficking and gang violence in the Dwight-Kensington and Fair Haven sections of New Haven. Led by the DEA New Haven Task Force and the New Haven and Hamden Police Departments, the year-long investigation included the use of court-authorized wiretaps on numerous telephones, extensive physical surveillance, controlled purchases of narcotics, execution of search warrants, and seizures of narcotics and firearms. Approximately 100 individuals were convicted of federal charges as a result of the investigation.
On February 6, 2014, a jury found ANDERSON guilty of one count of conspiracy to possess with intent to distribute, and to distribute, 28 grams or more of cocaine base (“crack”).
According to the evidence at trial, ANDERSON conspired with Kevin Wilson, also known as “Nature,” to distribute crack cocaine and heroin, primarily in the Dwight/Chapel area of New Haven. The trial evidence also revealed that ANDERSON supplied crack cocaine on multiple occasions to co-defendant Jesus Morales, also known as “Cano,” in deals that were brokered by Wilson. On several occasions, Anderson was intercepted on a wiretap threatening violence against Morales in an effort to collect a drug debt. At times, ANDERSON also obtained quantities of heroin from Wilson.
ANDERSON’s criminal history includes convictions for robbery and narcotics offenses.
ANDERSON has been detained since his arrest on May 17, 2012.
Wilson and Morales pleaded guilty. On September 26, 2013, Morales was sentenced to 63 months of imprisonment. Wilson awaits sentencing.
This matter was investigated by the Drug Enforcement Administration’s New Haven Task Force, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the New Haven, Hamden, West Haven, North Haven, Branford, Ansonia and Meriden Police Departments. The United States Marshals Service, the Connecticut State Police, the Connecticut Department of Correction, Parole and Community Services and the Milford, Hartford, New Britain, North Branford and Stratford Police Departments provided valuable assistance to the investigation.
This case is being prosecuted by Assistant U.S. Attorneys S. Dave Vatti and Marc Silverman.
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[email protected]New Haven Man Sentenced to 8 Years in Federal Prison for Illegal Gun PossessionRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that JAROD BROWN, 44, of New Haven, was sentenced today by Senior U.S. District Judge Warren W. Eginton in Bridgeport to 96 months of imprisonment, followed by three years of supervised release, for possession of a firearm by a previously convicted felon. On November 14, 2013, a jury found BROWN guilty of the offense.
According to evidence introduced at trial, on April 5, 2011, BROWN fled from New Haven Police after a routine traffic stop. BROWN initially rammed a police car and engaged police in a car chase. He then exited the car and engaged police in a foot chase during which he discarded a loaded 9mm pistol in the yard of a residence on Elm Street. BROWN was apprehended and the firearm was recovered.
BROWN’s criminal history includes convictions for larceny, narcotics and firearms offenses. In 1993, BROWN was sentenced in New Haven federal court to 92 months of imprisonment for possession of a firearm by a previously convicted felon.
It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.
BROWN has been detained since his arrest.
This matter was investigated by the New Haven Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. The case was prosecuted by Assistant U.S. Attorneys Jonathan Francis and Rahul Kale.
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[email protected]Ellington Man Admits Stealing Firearm, Selling It to Heroin DealerRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that JUSTIN ASHLINE, 24, of Ellington, waived his right to be indicted and pleaded guilty yesterday before U.S. District Judge Stefan R. Underhill in Bridgeport to one count of possession of a firearm by a previously convicted felon.
According to court documents and statements made in court, in late April or early May 2014, ASHLINE stole a Ruger .357 caliber handgun from his employer’s truck, traveled to Hartford and sold the gun to his heroin dealer in exchange for approximately 20 baggies of heroin and between $70 and $100 in cash. On May 23, 2014, law enforcement officers located and seized the handgun when they executed a search warrant at the Hartford residence of the heroin dealer.
ASHLINE has been detained in federal custody since his arrest on June 20, 2014.
ASHLINE has four prior felony convictions, including one for sale of narcotics and one for first degree larceny. It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.
Judge Underhill scheduled sentencing for April 7, 2015, at which time ASHLINE faces a maximum term of imprisonment of 10 years and a fine of up to $250,000.
This matter was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Drug Enforcement Administration, the Connecticut State Police and the Hartford Police Department. The case is being prosecuted by Assistant U.S. Attorney Robert M. Spector.
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[email protected]Hartford Heroin Dealer Sentenced to 5 Years in Federal PrisonRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that ERIC COLON, 29, of Hartford, was sentenced yesterday by U.S. District Judge Stefan R. Underhill in Bridgeport to 60 months of imprisonment, followed by four years of supervised release, for conspiring to possess and distribute heroin, some of which he stole from his drug supplier.
According to court documents and statements made in court, in January 2013, the DEA’s Hartford Task Force began an investigation into the narcotics distribution activities of Luis Fernandez of East Hartford. The investigation, which included the use of court-authorized wiretaps and controlled purchases of narcotics, revealed that Fernandez’s family members and associates in southern California shipped heroin, cocaine and marijuana to Fernandez at various addresses in the Hartford area. Fernandez, who also was supplied with narcotics from individuals in New York, sold the drugs locally to other dealers and customers.
The investigation revealed that COLON acquired distribution quantities of heroin from co-defendant Jose Rivera-Baron on several occasions. During the course of the investigation, COLON, on behalf of co-defendant Joshua Saez, made arrangements to obtain approximately 140 grams of heroin from Rivera-Baron. On August 16, 2013, while under law enforcement surveillance, Rivera-Baron met with COLON and Saez in the parking lot of a restaurant on Franklin Avenue in Hartford. Following the meeting, COLON drove away at high rate of speed. Investigators believed that Rivera-Baron had been robbed and pursued COLON’s car. Saez exited the car and was taken into custody, but the chase of COLON was terminated for public safety reasons.
A search of Saez’s person revealed two handguns, as well as 138.1 grams of heroin that SAEZ and Colon had stolen from Rivera-Baron.
The quantity of heroin that Saez possessed would have produced nearly 7000 individual dosage bags and had a street value of approximately $35,000.
COLON was arrested on October 9, 2013. On October 20, 2014, he pleaded guilty to one count of conspiracy to possess with intent to distribute 100 grams or more of heroin.
More than 20 individuals have been charged with narcotics distribution and related offenses as a result of this investigation. Fernandez, Saez and Rivera-Baron have pleaded guilty and, on December 2, 2014, Saez was sentenced to 71 months of imprisonment. Fernandez and Rivera-Baron await sentencing.
This investigation has been led by the Drug Enforcement Administration’s Hartford Task Force, including personnel from the DEA Hartford Resident Office and the Bristol, Hartford, Manchester, New Britain, Newington, and Wethersfield Police Departments. Agencies assisting the investigation include the DEA in New Haven, Bridgeport, Los Angeles and Panama, Federal Bureau of Investigation, U.S. Marshals Service, U.S. Department of Homeland Security, U.S. Postal Inspection Service, Connecticut State Police, State of Connecticut Office of Adult Probation, and the Hartford, East Hartford and New Britain Police Departments.
The case is being prosecuted by Assistant U.S. Attorneys S. Dave Vatti and Assistant U.S. Attorney Gabriel J. Vidoni.
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[email protected]Connecticut Construction Company Admits Underfunding Retirement Plan, Filing False Tax ReturnRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that CHERRY HILL CONSTRUCTION, INC., a company based in North Branford, waived its right to indictment and pleaded guilty today in New Haven federal court to one count of filing a false tax return, and one count of making a false statement in relation to documents required by the Employee Retirement Income Security Act of 1974 (“ERISA”). ERISA is a federal law that sets minimum standards for retirement plans in private industry, including a requirement that plan sponsors provide adequate funding for a plan.
According to court documents and statements made in court, CHERRY HILL CONSTRUCTION, INC., (“CHERRY HILL”) provides statewide service in site development, on-site crushing, trucking, demolition, as well as roll-off dumpsters, top soil, aggregates and landscaping. CHERRY HILL was awarded and completed prevailing wage construction projects requiring payment of the prevailing wage rate plus the fringe rate. The fringe rate is the cost of benefits to the employee.
When a company is awarded a prevailing wage project, the company must submit certified payrolls that list the hours, prevailing wage rate and fringe they are paying each employee. The company can either pay the employee the fringe directly or open a benefit plan with the fringe payment being deposited into an account for the benefit of that employee. The company is then paid by the federal, state or municipal governments the amount of payroll, including the fringe, after receiving the certified payrolls. The government entity for which the project is being worked pays these funds only because the employer certifies that the prevailing wage and fringe is being paid to an employee directly or being deposited into a benefit plan.
CHERRY HILL opened a profit sharing/401(k) plan that was covered under ERISA. In pleading guilty, CHERRY HILL admitted that, in 2010 and 2011, it underfunded its retirement plan by approximately $950,000. CHERRY HILL further admitted that it filed a corporate tax return for the 2010 tax year that inflated its actual contribution to the plan, which resulted in an increased employee benefit deduction.
CHERRY HILL is scheduled to be sentenced by U.S. District Judge Janet Bond Arterton on April 7, 2015, at which time it faces a maximum penalty of 10 years of probation and a $750,000 fine.
CHERRY HILL has fully funded its retirement plan and paid $193,000 in back taxes, interest and penalties.
This matter is being investigated by the Internal Revenue Service – Criminal Investigation Division; U.S. Department of Labor – Office of Inspector General, Office of Labor Racketeering and Fraud Investigations; U.S. Department of Labor – Employee Benefits Security Administration, and U.S. Department of Transportation – Office of Inspector General. The case is being prosecuted by Assistant U.S. Attorney Douglas P. Morabito.
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Tom Carson
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[email protected]U.S. Attorney Announces Formation of Educational Opportunities Civil Rights Working GroupRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced the formation of the Educational Opportunities Civil Rights Working Group to address civil rights violations by public and private educational institutions, afterschool programs, summer camps and day care centers.
U.S. Attorney Daly stated that the U.S. Attorney’s Office in Connecticut regularly receives complaints from concerned parents and caregivers alleging that their children were discriminated against by schools, afterschool programs and summer camps because of the child’s disability, gender, gender identity, or limited ability to speak English. In addition, the Office has received an increasing number of complaints about bullying, sexual harassment and school segregation in public and private schools. Over the last several months, the Office has settled cases against schools, afterschool programs and day care centers for violations of the Americans with Disabilities Act and the Equal Educational Opportunities Act of 1974. These settlements have resulted in monetary settlements to parents, comprehensive training for providers, and sweeping policy changes to entire educational programs and systems.
Most recently, the U.S. Attorney’s Office has reached a settlement with Quinnipiac University to resolve allegations that the university violated the Americans with Disabilities Act by placing a student who had been diagnosed with depression on a mandatory medical leave of absence without first considering options for the student’s continued enrollment.
Recognizing a greater need to address and help prevent civil rights violations in educational and camp settings, the U.S. Attorney’s Office has partnered with federal and state agencies and advocacy groups to form the Educational Opportunities Civil Rights Working Group.
Participating in the Working Group are representatives from the U.S. Department of Health and Human Services, U.S. Department of Education, Connecticut Department of Education, Commission on Human Rights and Opportunities, Connecticut Office of Protection and Advocacy for Persons with Disabilities, African American Affairs Commission, Latino and Puerto Rican Affairs Commission, Asian Pacific American Affairs Commission, National Association for the Advancement of Colored People, Connecticut Children’s Medical Center, Connecticut Center for Children’s Advocacy, Connecticut Afterschool Network, Connecticut Recreation and Parks Association and the Connecticut Summer Camp Network.
The Working Group is developing and implementing a strategic action plan to address civil rights violations through educational outreach programs as well as law enforcement actions.
“Civil rights violations in educational and camp settings undermine the well-being of our most vulnerable citizens – our children,” stated U.S. Attorney Daly. “Through aggressive outreach and enforcement initiatives, the U.S. Attorney’s Office and our working group partners strive to eliminate these violations to improve the health and welfare of all children and young adults.”
To contact the Educational Opportunities Civil Rights Working Group, please call 203-821-3836.
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Tom Carson
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[email protected]Justice Department Settles Americans with Disabilties Act Case with Quinnipiac UniversityRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, and Acting Assistant Attorney General Vanita Gupta of the Justice Department’s Civil Rights Division, today announced that the government has reached a settlement with Quinnipiac University to resolve allegations that the university violated the Americans with Disabilities Act (ADA) by placing a student who had been diagnosed with depression on a mandatory medical leave of absence without first considering options for the student’s continued enrollment. Quinnipiac University is a private, coeducational university located in Hamden, Connecticut.
This matter stems from a complaint from a Quinnipiac University (“Quinnipiac”) student who had been removed from the university after she sought mental health counseling at the university. The complainant also alleged that, after she had been removed, Quinnipiac denied her request to refund her tuition.
Title III of the ADA prohibits discrimination on the basis of disability, including depression, by places of public accommodation.
The investigation determined that Quinnipiac discriminated against the complainant by placing her on mandatory medical leave because of her depression, and failed to consider modifying its mandatory medical leave policy to permit the complainant to complete her course work while living off campus by attending classes either online or in person.
Under the settlement agreement, Quinnipiac has agreed to pay to the complainant $17,000 to compensate her for emotional distress, pain and suffering, and $15,126.42 to pay off the loan she obtained to pay tuition to Quinnipiac. Quinnipiac also has agreed to implement a policy stating that it will not discriminate against applicants or students on the basis of disability, including persons with mental health disabilities, and to examine what modifications it can make to allow students with mental health disabilities to continue to participate in educational programs and attend their classes while seeking treatment for mental health conditions. The university also will provide training on Title III of the ADA, with a focus on mental health-related disability discrimination, to all staff.
“Quinnipiac removed this student from the university at a very vulnerable time in her life, and saddled her with a large student loan payment,” said U.S. Attorney Daly. “Instead of removing students from school, educational institutions must be equipped to manage and educate students who recognize, disclose and are treating their mental health disabilities. We’re pleased that Quinnipiac has settled this matter, compensated the complainant and will implement a non-discrimination policy to help prevent this ADA violation from occurring in the future.”
“This settlement agreement reflects the critical role that educational institutions play in ensuring that students with mental health disabilities are afforded an equal opportunity to fully participate in all that colleges and universities have to offer,” said Acting Assistant Attorney General Gupta. “Under the ADA, universities like Quinnipiac cannot apply blanket policies that result in unnecessary exclusion of students with disabilities if reasonable modifications would permit continued participation; in many cases, such modifications can be as simple as allowing a student to complete coursework on a modified schedule.”
This matter was handled by Assistant U.S. Attorney Lisa Perkins of the District of Connecticut and Trial Attorney Nabina Sinha of the Disability Rights Section of the Justice Department’s Civil Rights Division.
The U.S. Attorney’s Office for the District of Connecticut has partnered with federal and state agencies and advocacy groups to form the Educational Opportunities Civil Rights Working Group to address civil rights violations by public and private educational institutions, afterschool programs, summer camps and day care centers. To contact the Working Group, please call 203-821-3836.
Additional information about the ADA can be found at www.ada.gov or by calling the Department’s toll-free information line at 800-514-0301 or 800-514-0383 (TTY).
More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt.
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Tom Carson
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[email protected]Connecticut Investment Advisor Sentenced to 40 Months in Federal Prison for Cherry-picking SchemeRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that NOAH L. MYERS, 43, of Lyme, was sentenced today by U.S. District Judge Stefan R. Underhill in Bridgeport to 40 months of imprisonment, followed by three years of supervised release, for defrauding investment clients in a “cherry-picking” securities scheme. MYERS also was ordered to perform 150 hours of community service.
“Investors have a right to the fair and ethical management of their savings,” stated U.S. Attorney Daly. “The sentence imposed today serves as ample warning that money managers who breach their clients trust in violation of federal securities laws will be prosecuted and risk losing their freedom and ill-gotten gains. We thank the FBI and the SEC for their efforts in uncovering this cherry-picking scheme.”
“Cherry-picking” is a fraudulent securities trading practice in which the responsible individual executes trades without assigning those trades to a particular trading account until the individual determines whether or not the trade has become profitable or suffered losses. The responsible individual then allocates the profitable trades to favored accounts – often the individual’s own account – and assigns unprofitable trades to disfavored client accounts.
According to court documents and statements made in court, MYERS was the sole owner of MiddleCove Capital, LLC (“MiddleCove”), a Connecticut limited liability company with its principal place of business in the Centerbrook section of Essex. MiddleCove had been registered with the U.S. Securities and Exchange Commission (“SEC”) as an investment adviser since 2008, and MYERS was the portfolio manager and managed a number of client accounts with assets of approximately $129 million. MiddleCove used Charles Schwab & Co., Inc. (“Schwab”) to trade securities and as the custodian of the investments held in client accounts. As part of the trading arrangement with Schwab, MYERS was permitted to place block purchases and sales of securities through a master account with Schwab and then, later in the day, allocate the purchases and sales to various accounts, including his personal accounts and various client accounts, all held by Schwab.
Between April 2009 and November 2010, MYERS engaged in “cherry-picking” at MiddleCove by purchasing the leveraged exchange traded fund (ETF) ProShares UltraShort Financials, otherwise known by its ticker symbol “SKF,” as well as other securities. MYERS then disproportionately allocated trades that had appreciated in value during the course of the day to his personal and business accounts and allocated trades that had depreciated in value during the day to the accounts of his advisory clients. As a result, MYERS gained as his clients suffered commensurate trading losses.
For example, in August 2009, on the nine days when MYERS purchased SKF in block trades in the master account and the security was sold as a day trade, MYERS allocated between 9 percent and 32 percent of the profitable block trades to his personal accounts. On three of those days he allocated between 27 percent and 31 percent of the profitable day trades to his personal accounts.
In addition, on September 2, 2009, MYERS purchased SKF in a block trade in the master account and, after the investment increased in value, sold the shares in a day trade and allocated more than 31 percent of the investment to his personal accounts. In sharp contrast, MYERS undertook four additional block purchases in the master account of SKF on September 3, 4, 16 and 28, 2009. On each of these days, when the SKF investment declined in value by the close of trading, MYERS allocated no more than 5 percent of the block trade to his personal accounts and instead allocated the remaining 95 percent of the shares to his clients’ accounts.
In filings with the SEC in April 2009 and March 2010, MYERS and MiddleCove represented that batched trades would be allocated fairly and not unduly favor MYERS or MiddleCove.
On January 16, 2013, the SEC issued an order revoking the registration of MiddleCove as an investment adviser and barred MYERS from the securities industry. MYERS also was ordered to pay $462,022 disgorgement, $26,096 in prejudgment interest, and a civil penalty of $300,000.
On October 20, 2014, MYERS waived his right to indictment and pleaded guilty to one count of security fraud.
This matter was investigated by the Federal Bureau of Investigation with the substantial assistance of the U.S. Securities and Exchange Commission. The case was prosecuted by Assistant U.S. Attorney Christopher W. Schmeisser.Citizens are encouraged to report any financial fraud schemes by calling, toll free, 855-236-9740, or by sending an email to [email protected].
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[email protected]Bank Employee Sentenced to Federal Prison for Embezzling More Than $450,000Read the Press Release
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Deirdre M, Daly, United States Attorney for the District of Connecticut, announced that MARIA ROSA ESTEVES, 41, of Bridgeport, was sentenced today by U.S. District Judge Robert N. Chatigny in Hartford to 12 months and one day of imprisonment, followed by six months of home confinement and three years of supervised release, for embezzling more than $450,000 from the bank where she was employed. ESTEVES also was ordered to pay full restitution, and to perform 60 hours of community service during her term of supervised release.
According to court documents and statements made in court, ESTEVES was employed by People’s United Bank from 1993 to 2014. Beginning in 2006, ESTEVES worked primarily in the bank’s Adjustments Department, ultimately holding the title of Lead Adjuster with responsibilities that included arranging for bank cashiers’ checks to be issued to customers when a customer’s account needed to be adjusted. ESTEVES used her position in the Adjustments Department to embezzle $452.122.08 from the bank by causing the bank to issue cashiers’ checks that ESTEVES would then use to pay persons or entities that she owed money to, including her utility company, homeowner’s insurance company and mortgage providers. ESTEVES also embezzled money by depositing cashiers’ checks into bank accounts she controlled and from which she, or others associated with her, were able to access the funds. In total, ESTEVES misappropriated more than 300 cashiers’ checks.
ESTEVES was ordered to report to prison on March 2, 2015.
On August 14, 2014, ESTEVES pleaded guilty to one count of embezzlement from a federally insured bank.
This case was investigated by the Federal Bureau of Investigation and was prosecuted by Senior Litigation Counsel Richard J. Schechter.
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[email protected]Seymour Man Who Filed False Tax Return, Structured Funds, Is SentencedRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that MICHAEL S. VASATURO, 57, of Seymour, was sentenced today by U.S. District Judge Alvin W. Thompson in Hartford to two years of probation for filing a false tax return. He was also ordered to pay a $16,000 fine and perform 100 hours of community service.
According to court documents and statements made in court, VASATURO, a business executive, earned supplemental income of approximately $132,500 in 2007 based on a private sale of copper to a scrap metal dealer, but failed to report any of the copper sale income on his 2007 federal income tax return.
VASATURO has previously paid the Internal Revenue Service $80,964.81 for the taxes plus interest and penalties due and owing on his unreported income. He also agreed to forfeit an additional $144,888 in cash that he admits to having “structured” into his bank account to avoid federal cash transaction reporting requirements.
On August 22, 2014, VASATURO pleaded guilty to one count of filing a false tax return.
This matter was investigated by the Internal Revenue Service – Criminal Investigation Division and was prosecuted by Assistant U.S. Attorney Henry K. Kopel.
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[email protected]Man Who Dealt Heroin Out of Hartford Grocery Store, Illegally Possessed Gun, Sentenced to Federal PrisonRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that JESUS AGOSTO, also known as “Gordo,” 24, of Hartford, was sentenced yesterday by U.S. District Judge Stefan R. Underhill in Bridgeport to 41 months of imprisonment, followed by three years of supervised release, for distributing heroin and illegally possessing a firearm.
According to court documents and statements made in court, in 2013, law enforcement received information that AGOSTO was selling significant quantities of heroin out of the Family Beltre Grocery store located on Broad Street in Hartford, and that AGOSTO was allegedly involved in illegal firearm trafficking. In July and August 2013, investigators made multiple controlled purchases of heroin from AGOSTO at the grocery store.
AGOSTO has been detained since his arrest on September 11, 2013. On that date, investigators executed search warrants at the grocery store and AGOSTO’s nearby apartment. The search of the apartment revealed a .9mm semi-automatic handgun, a magazine loaded with seven rounds of .9mm ammunition, a shoe-box with narcotics-related materials and approximately $25,000 in cash.
AGOSTO was previously convicted of robbery in the first degree after he and an associate robbed a woman at gun point.
It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.
On July 1, 2014, AGOSTO pleaded guilty to one count of possession with intent to distribute and distribution of heroin, and one count of possession of a firearm by a previously convicted felon.
This matter was investigated by the Drug Enforcement Administration Hartford Task Force, including the Hartford, New Britain, Bristol, Wethersfield, Newington and Manchester Police Departments. The case was prosecuted by Assistant U.S. Attorney Geoffrey M. Stone.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
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[email protected]