Southern District of Florida
Press releases recorded for this federal judicial district.
Twenty Charged in Southern District of Florida as Part of Largest Elder Fraud Sweep in Department of Justice HistoryRead the Press Release
Attorney General Jeff Sessions and U.S. Attorney Benjamin G. Greenberg for the Southern District of Florida announced the largest ever coordinated sweep of elder fraud cases in the Department of Justice’s history involving more than 250 charged defendants around the globe who victimized more than a million Americans, most of whom were elderly. The cases include criminal, civil, and forfeiture actions across 50 federal districts. Of the defendants, 200 were charged criminally. In each case, offenders engaged in financial schemes that targeted or largely affected seniors. In total, the charged elder fraud schemes caused losses of more than half a billion dollars. In the Southern District of Florida a total of 20 defendants were charged with offenses relating to their participation in various fraud schemes involving over $103 million.
Antonio J. Gomez, Inspector in Charge, U.S. Postal Inspection Service (USPIS), Mark Selby, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), Brian Swain, Special Agent in Charge, U.S. Secret Service (USSS), and Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, join in the announcement.
The actions charged a variety of fraud schemes, ranging from mass mailing, telemarketing and investment frauds to individual incidences of identity theft and theft by guardians. A number of cases involved transnational criminal organizations that defrauded hundreds of thousands of elderly victims, while others involved a single relative or fiduciary who took advantage of an individual victim. The schemes charged in these cases caused losses to more than a million victims.
“The Justice Department and its partners are taking unprecedented, coordinated action to protect elderly Americans from financial threats, both foreign and domestic,” said Attorney General Sessions. “Today’s actions send a clear message: we will hold perpetrators of elder fraud schemes accountable wherever they are. When criminals steal the hard-earned life savings of older Americans, we will respond with all the tools at the Department’s disposal – criminal prosecutions to punish offenders, civil injunctions to shut the schemes down, and asset forfeiture to take back ill-gotten gains. Today is only the beginning. I have directed Department prosecutors to coordinate with both domestic law enforcement partners and foreign counterparts to stop these criminals from exploiting our seniors.”
“We cannot allow our elderly and vulnerable citizens to continue to be the target of fraud schemes. For that reason, the U.S Attorney’s Office and its law enforcement partners – criminal and civil – have joined forces to combat Florida-based fraud schemes victimizing the elderly in our community and throughout our nation,” stated U.S. Attorney Benjamin G. Greenberg. “We will bring to justice those who target the elderly and defraud them out of their life savings.”
“The U.S. Postal Inspection Service will continue to work tirelessly with our partners both in the U.S. and abroad, to ensure that the Postal Service is not used to perpetuate predatory schemes that target the elderly,” said Antonio J. Gomez, Inspector in Charge, U.S. Postal Inspection Service, Miami Division. “Today’s operation is a great example of how law enforcement from all over the world is working together to that end.”
“We will not allow criminals to target some of the most vulnerable members of our community and take away what they have worked a life time for,” said Mark Selby, Special Agent in Charge of HSI in Miami. “HSI is committed to working with local, state, federal and international law enforcement partners to bring these individuals to justice.”
“The U.S. Secret Service remains committed to investigating cyber based criminal schemes,” said Special Agent in Charge Brian Swain, U.S. Secret Service Miami Field Office.
“Unfortunately, elderly citizens are sometimes vulnerable to financial exploitation by unscrupulous fraudsters bent on making ill-gotten gains,” said Robert F. Lasky, Special Agent in Charge, FBI Miami. “In this case, the alleged swindlers used a variety of scams to collect and then launder over $94 million. The FBI and our partners are continuously adapting our investigative techniques to bring to justice offenders who take advantage of the elderly.”
The following cases from the Southern District of Florida were charged between February 2017 and February 22, 2018:
LOTTERY FRAUD
1. United States v. Claude Shaw, Case No 17-60056-CR-Dimitrouleas
On February 21, 2017, Claude Shaw, 50, of Miramar, was charged with two counts of mail fraud and 10 counts of wire fraud in connection with a fraudulent lottery scheme tied to Jamaica. Shaw pled guilty to one count of mail fraud and on June 2, 2017, was sentenced to 36 months imprisonment, to be followed by three years supervised release. Shaw was also ordered to pay $128,440 in restitution.
According to court documents, between September 2013 and August 2015, Shaw participated in a scheme where victims throughout the United States received telephone calls that falsely informed such victims they had won over $1 million in a lottery, which required such victims to pay money in advance in order to secure their prize. The victims were instructed on how, and to whom, to send their money, which included an instruction to send their money to Shaw. Victims sent over $100,000 to Shaw, who then forwarded a portion of the money to Jamaica. Victims never received any lottery winnings.
Mr. Greenberg commended the investigative efforts of the USPIS. The case was prosecuted by Trial Attorney Arturo DeCastro with the Consumer Protection Branch of the Department of Justice Civil Division.
2. United States v. Marvin Damian Coote, Case No. 17-14041-CR-Marra
On May 30, 2017, Marvin Damian Coote, 36, of Fort Pierce, was indicted on conspiracy to commit mail and wire fraud and wire fraud among other charges. Coote pled guilty and was sentenced on December 1, 2017, to 41 months imprisonment, to be followed by three years supervised release. Coote was ordered to pay $225,995.68 in restitution.
According to court documents, between March 2011 and May 1, 2017, Coote participated in a mail and wire fraud conspiracy in St. Lucie County in which, like the Shaw matter described above, co-conspirators telephoned victims to notify them that they had won a lottery that required such victims to send payment in advance in order to secure their prize. Victims paid fees of several hundred to several thousand dollars in order to collect their purported lottery winnings. The conspirators kept the victims’ money without paying any lottery and sweepstakes winnings. Victims targeted in this scheme were elderly individuals, typically over the age of 70. The financial transactions that were part of the scheme included the use of United States Postal Service, MoneyGram, Western Union and Green Dot cards.
Mr. Greenberg commended the investigative efforts of USPIS, ICE-HSI and the St. Lucie County Sheriff’s Office. This case was prosecuted by Assistant United States Attorneys Marton Gyires and Stephen Carlton.
3. United States v. Christian Villalobos Hernandez, Case No. 18-20052-CR-Martinez
Christian Eduardo Villalobos Hernandez, 35, of San Jose, Costa Rica, was indicted on January 25, 2018, for conspiracy to commit mail fraud, mail fraud, conspiracy to commit money laundering, international money laundering and money laundering. According to the Indictment, starting in or around February 2015 through in or around August 2017, several Costa Rican and Venezuelan citizens, including Hernandez, Andres Pacheco Fonseca (“Fonseca”) and other known co-conspirators, devised and implemented a scheme to unlawfully enrich themselves by contacting victims by telephone, letter or fax and falsely informing them that they had won millions of dollars in a lottery or sweepstake.
As alleged, the conspirators persuaded victims through false and fraudulent representations that in order to collect their winnings they had to send by mail and wire transfer large amounts of cash and money orders to addresses in Miami, Costa Rica, and elsewhere, and to have those same funds deposited in corporate and personal bank accounts the conspirators controlled here in the United States. Within days, the victims’ funds were sent by wire transfer from the corporate and personal accounts located in the United States to corporate and personal bank accounts in Costa Rica that were controlled by Hernandez, Fonseca, their co-conspirators, and their family and friends. In total, approximately $9 million was sent by wire transfer from their accounts in the United States to corporate and personal bank accounts they controlled in Costa Rica.
Mr. Greenberg commends the investigative efforts of USPIS. This case is being prosecuted by Assistant United States Attorney Maurice Johnson.
GRANDPARENT SCAM
4. United States v. Tiffany Strobl, Case No. 17-60128-CR-Dimitrouleas
Tiffany Strobl, 38, of Ohio, was charged for bank fraud, wire fraud, use of an unauthorized access device and identity theft in connection with a scheme to defraud an elderly victim. According to court documents, Strobl used a stolen identity to open a bank account at TD Bank and then deposited $5,000 into that account. Those funds came from an 81 year-old woman living in Iowa who Strobl contacted in February 2017. Strobl informed the victim that her grandson was in jail and requested the victim to wire $5,000 to a TD Bank account so that her grandson could post bond. The victim complied and later learned that her grandson had never been arrested and had not called her for money.
Strobl pled guilty in October 2017, and was sentenced to 24 months imprisonment, to be followed by one year supervised release and ordered to pay $9,548.25 in restitution.
Mr. Greenberg commended the investigative efforts of the USSS. This case was prosecuted by Assistant United States Attorney Anita White.
ADVERTISING SCAM
5. United States v. Tiffany Strobl, Case No. 17-60066-CR-Dimitrouleas
In March 2017, Tiffany Strobl, 38, of Ohio, was charged with possession of false identification documents and bank fraud. In mid-February 2017, a victim saw an advertisement for a mobile home on Craigslist that was purportedly being sold by an individual out of Salt Lake City, Utah. The victim communicated with the seller via email and text message and was to pay $6,800 for the mobile home through a website called Ebay Motors. The victim initiated a wire transfer for the purchase of the mobile home through a link on Ebay Motors that was linked to a BB&T Bank account number. Strobl had opened the BB&T account using false and fraudulent identification documents. Strobl attempted to withdraw the funds deposited into the account by the victim who, when contacted by the bank, instructed the bank to stop the transaction because he had subsequently seen on Craigslist the same mobile home for sale in Kansas. A search of Strobl’s book bag incident to arrest, revealed six driver licenses, each bearing the same photograph of Strobl, but with different names, dates of birth, and license numbers.
After a guilty plea, Strobl was sentenced in June 2017, to five months imprisonment, to be followed by three years supervised release.
Mr. Greenberg commended the investigative efforts of USSS. The case was prosecuted by Assistant United States Attorney Anita White.
MONEY LAUNDERING OF SCAM PROCEEDS
6. United States v. Roda Taher, et al, Case No. 17-60223-CR-Ungaro
United States v. Luis Pujols, Case No. 17-20702-CR-MartinezOne indictment charged Roda Taher, 38, of Beirut, Lebanon, Geanis Gonzalez, 31, of Peyton Colorado, Alfredo Tovar, 36, of Miami Gardens, Quiana Velasco, 35, of Miami, Jose Daniel Estrella, 38, of Hallandale, Pedro Reyes, 38, of Hialeah, Robinson Castillo, 32, of Pembroke Pines and Jamie Vices Castillo, 41, of Pembroke Pines, with conspiracy to commit money laundering, conspiracy to commit bank fraud, money laundering, and conducting transactions in criminally derived property. Hanan Jaafar, 26, of Beirut Lebanon, is also charged with conspiracy to commit money laundering and conspiracy to commit bank fraud.
According to the Indictment, from 2008 to the present, Taher managed and supervised a criminal organization engaged in money laundering and transactions in criminally derived property that received approximately $94 million in fraudulent proceeds. The organization utilized bank accounts opened in the names of shell corporations to receive the proceed of various fraudulent schemes, including romance frauds, email hacking schemes, inheritance and lottery scams that victimized individuals, including elderly individuals, as well as corporations. Taher would recruit individuals to act as “money mules,” establishing the shell corporations in the money mules’ names. The defendants would then have the money mules open bank accounts throughout South Florida in the names of their shell corporations, instructing the mules to falsely represent to the banks that the shell corporations were legitimate businesses engaged in the import, export, or sale of various goods. Once the bank accounts received money wired from a fraud victim, the defendant would instruct the money mules to wire money to other accounts overseas.
A second indictment charged Luis Angel de Jesus Alfonseca Pujols, 24, of Sunrise, Gary Alberto Camillo, 26, of Pembroke Pines, Jean-Phillipe Etienne, 25, of Pembroke Pines, Randy Eliessel Santos, 29, of Hollywood, and Cosme Daniel Enrique Vasquez, 36, of Miramar, with conspiracy to commit bank fraud and wire fraud, international money laundering, money laundering and bank fraud. Karina Marie Ocasio, 24, of Weston, is also charged with conspiracy to commit money laundering, conspiracy to commit bank fraud and wire fraud, money laundering, and bank fraud.
Alberto Camillo, Jean-Phillipe Etienne and Randy Eliessel Santos have pled guilty.
Mr. Greenberg commends the investigative efforts of the FBI, USSS and ICE-HSI. This case is being prosecuted by Assistant United States Attorneys Jared Strauss, Michael Walleisa and Dwayne Williams.
A criminal complaint, information or indictment is a charging instrument containing allegations. All defendants are presumed innocent, unless and until proven guilty in a court of law.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Port St. Lucie Dermatologist Sentence on Obstruction and Fraud ChargesRead the Press Release
Physician Gary L. Marder, D.O., 61, of Palm Beach County, and owner and operator of the Allergy, Dermatology & Skin Cancer Centers in Port St. Lucie and Okeechobee, was sentenced yesterday in relation to his guilty plea to the crimes of obstruction of a health care investigation and health care fraud.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, Shimon R. Richmond, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), Miami Region, John F. Khin, Special Agent in Charge, Defense Criminal Investigative Service (DCIS), Southeast Field Office, Martin J. Dickman, Inspector General, U.S. Railroad Retirement Board, Office of Inspector General (RRB-OIG), and Scott Rezendes, Special Agent in Charge, United States Office of Personnel Management, Office of Inspector General (OPM-OIG), made the announcement.
U.S. District Judge Robin L. Rosenberg sentenced Marder to 36 months imprisonment, to be followed by one year of supervised release. Judge Rosenberg also ordered Marder to pay $200,000 fine and a special assessment of $200, each to be paid immediately. Marder is required to surrender to the place designated for his incarceration on April 23, 2018, by noon. Marder was also required to permanently surrender his license to practice as an osteopathic physician, and is not allowed to own, operate, manage or consult in a medical practice in anyway during the term of his sentence.
Marder pled guilty and admitted to committing the crimes of obstructing the investigation of federal healthcare fraud by delivering falsified and altered patient files that had been subpoenaed by a federal grand jury and delivered to an FBI Special Agent, and to having submitted approximately $350,000 in false claims for the services of a medical physicist to healthcare benefits programs including Medicare, Tricare, Railroad Retirement Board, OPM health insurance programs and other insurers.
The investigation originally arose from a Qui Tam lawsuit filed by whistleblower Theodore A. Schiff, M.D. alleging that Marder knowingly submitted fraudulent claims to federal healthcare programs for payment to which Marder was not entitled. On February 7, 2017, the government and Marder entered into a settlement of the civil suit resulting in Marder agreeing to an $18 million judgment in favor of the United States that was subsequently satisfied by the payment of approximately $6 million to the United States by Marder. Marder paid $5.2 million and transferred a piece of real property to the United States to settle this civil suit. The United States agreed that this payment would also satisfy any restitution due and owing in the criminal case.
Mr. Greenberg commended the investigative efforts of the FBI, HHS-OIG, DCIS, RRB-OIG and OPM-OIG. This case was prosecuted by Assistant U.S. Attorney Ellen L. Cohen.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Former Opa Locka City Commissioner Sentenced for Role in Corruption SchemeRead the Press Release
Former City of Opa Locka Commissioner Luis Santiago was sentenced yesterday by United States District Judge Kathleen M. Williams, for his participation in a two-year long bribery and extortion under color of official right conspiracy, in violation of Title 18, United States Code, Sections 371, 666(a)(1)(B), and 1951(a).
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, and Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, made the announcement.
Santiago was sentenced to a term of 51 months in prison, to be followed by three years of supervised release. Santiago’s sentence also included restitution and an order of forfeiture, along with the imposition of a $100 special assessment. Santiago was the fourth person to date convicted and sentenced as part of the ongoing federal investigation into Opa Locka municipal corruption being led by the FBI’s Public Corruption Task Force and the United States Attorney’s Office, with assistance from the Internal Revenue Service – Criminal Investigation (IRS-CI).
Santiago previously pled guilty to an Information and admitted to conspiring with former Opa Locka City Manager David Chiverton, former Opa Locka Assistant Public Works Director Gregory Harris, and others to use their official positions and authority with the City of Opa Locka to solicit, demand, and obtain thousands of dollars in illegal cash payments from businesses and individuals in exchange for taking official actions to assist and benefit those businesses and individuals in their dealings with the City of Opa Locka.
In exchange for the illegal payments Santiago and an associate would obtain from these businesses and individuals, City of Opa Locka officials and employees, including Chiverton and Harris, would be directed and pressured to assist them by issuing occupational licenses; waiving, removing, and settling code enforcement matters and liens; initiating, restoring and continuing water service; and assisting with zoning issues. Santiago would sometimes pay Chiverton for this assistance, and on occasion would tell the businesses and individuals to pay Chiverton directly in exchange for these official actions.
Chiverton and Harris previously pled guilty to the same corruption conspiracy charge, as did Demetrius Corleon Taylor, a non-employee who also helped collect money from Opa Locka businesses in exchange for official actions by city employees.
Mr. Greenberg commended the investigative efforts of the FBI Miami Area Corruption Task Force and IRS-CI. This case is being prosecuted by Senior Litigation Counsel Edward Stamm and Assistant United States Attorney Maurice Johnson.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
South Florida Doctor Sentenced in Medicare Fraud SchemeRead the Press Release
Dr. Salomon Melgen was sentenced today to 17 years in prison, to be followed by three years of supervised release by the U.S. District Judge Kenneth A. Marra in West Palm Beach, Florida. This sentencing is the culmination of a multi-year investigation, which was followed by an eight week jury trial in April 2017 that resulted in Melgen’s conviction on 67 counts of health care fraud and related charges.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida; Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigations (FBI), Miami Field Office; Shimon R. Richmond, Special Agent in Charge, U.S. Department of Health and Human Services, Office of the Inspector General (HHS-OIG); Patrick Fletcher, Special Agent in Charge, U.S. Railroad Retirement Board, Office of Inspector General (RRB-OIG); and John F. Khin, Special Agent in Charge, Defense Criminal Investigative Service (DCIS), made the announcement.
Melgen, an ophthalmologist who specialized in the treatment of retinal disorders and who had practiced in Palm Beach and St. Lucie Counties for many years until his arrest in 2015, engaged in a scheme to defraud the Medicare program and other health care benefit programs, by, among other things, falsely diagnosing Medicare patients with macular degeneration and then performing and billing for excessive and medically unnecessary tests and procedures, which included injections of expensive drugs and laser treatments. These tests and procedures resulted in Melgen’s receiving tens of millions of dollars in reimbursement from the Medicare program alone during the six-year period of January 2008 through December 2013.
In sentencing Melgen, Judge Marra found that the intended fraud loss was over $70 million and the actual fraud loss to Medicare was $42 million. In addition to the term of incarceration, the defendant was ordered to make full restitution to Medicare. Losses to other insurance companies and to individual patients will be determined at a future hearing.
“In perpetrating his multi-million fraud scheme on health care benefit programs like Medicare, Dr. Melgen showed complete disregard for what was best for his patients and abused their trust for his own personal financial gain,” stated U.S. Attorney Benjamin G. Greenberg. “Dr. Melgen has been held responsible for his egregious fraud scheme. Today’s sentence should serve as a reminder that the U.S. Attorney’s Office and our law enforcement partners remain committed to bringing those who illegally divert the community’s tax dollars to justice, regardless of their professional position.”
“The reprehensible conduct of Salomon Melgen is a disgrace to the medical profession,” said Robert F. Lasky, Special Agent in Charge, FBI Miami. “Not satisfied with being a successful ophthalmologist committed to treating his patients’ legitimate medical conditions, Melgen devised a scheme to enrich himself by defrauding Medicare and other benefit programs to the tune of tens of millions of dollars. The FBI will not relent in its pursuit of Medicare fraudsters – including greedy doctors.”
“Salomon Melgen callously took advantage of patients who came to him fearing blindness,” said Shimon Richmond, Special Agent in Charge of the U.S. DHHS Office of Inspector General’s Miami Region. “Instead of treatment, they received medically unreasonable and unnecessary tests and procedures that victimized his patients and the American taxpayer. Today’s sentencing is a stark reminder that the OIG and our partners will not tolerate Medicare fraud and will not rest in our efforts to protect patients in their time of need.”
“The U.S. Railroad Retirement Board, Office of Inspector General is committed to fighting Medicare fraud, waste and abuse and is proud to be part of this collaborative effort with the FBI, HHS-OIG, DCIS-OIG and OPM-OIG,” said Inspector General Martin J. Dickman. “The sentencing of Dr. Melgen sends a loud and clear message that combating Medicare fraud is a top Federal law enforcement priority and unscrupulous Medicare providers will not be tolerated.”
“This sentencing demonstrates the effectiveness of our joint investigations to pursue corrupt health care providers who defraud Federal health care programs,” stated Defense Criminal Investigative Service (DCIS) Special Agent in Charge John F. Khin, Southeast Field Office. “DCIS is committed to preserving the integrity of DoD’s TRICARE program which serves America's Warfighters and their families.”
Mr. Greenberg commended the investigative efforts of the FBI, HHS-OIG, RRB-OIG and DCIS. This case was prosecuted by Assistant United States Attorneys Roger H. Stefin, Carolyn Bell and Alexandra Chase.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Miami-Area Man Sentenced to Five Years in Prison for Role in $63 Million Health Care Fraud SchemeRead the Press Release
A Miami-area man was sentenced to 60 months in prison today for his role in a $63 million health care fraud scheme involving a now-defunct community mental health center located in Miami that purported to provide partial hospitalization program (PHP) services to individuals suffering from mental illness.
Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, U.S. Attorney Benjamin G. Greenberg of the Southern District of Florida, Special Agent in Charge Robert Lasky of the FBI’s Miami Field Office and Special Agent in Charge Shimon R. Richmond of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office made the announcement.
Samuel Konell, 70, of Boca Raton, Florida, was sentenced by U.S. District Judge Jose E. Martinez of the Southern District of Florida. Judge Martinez also ordered Konell to pay $9,921,726 in restitution and to forfeit certain substitute assets, including several pieces of jewelry, in partial satisfaction of a personal money judgment entered against the defendant in the amount of $432,829. Konell pleaded guilty on Nov. 21, 2017, to one count of conspiracy to defraud the United States and receive health care kickbacks.
As part of his guilty plea, Konell admitted that from approximately January 2006 through June 2012, he received kickbacks and/or bribes in return for referring Medicare beneficiaries from the Miami-Dade state court system to Greater Miami Behavioral Healthcare Center Inc. (Greater Miami) to serve as patients. He admitted that he coordinated with criminal defendants in the state court system to obtain court orders for mental health treatment in lieu of incarceration so that he could refer those individuals to Greater Miami to serve as patients in return for kickbacks and/or bribes. Konell further admitted that he did so knowing that certain of those individuals were not mentally ill or otherwise did not meet the criteria for PHP treatment.
In addition, Konell admitted that he and his co-conspirators at Greater Miami took steps to disguise the true nature of the kickbacks and/or bribes that Greater Miami paid to Konell and other patient brokers. Specifically, Konell was placed on the Greater Miami payroll to make the kickbacks and/or bribes appear as though they were legitimate salary payments, he admitted. Konell further admitted that he was originally paid a flat monthly rate that was based on the number of patients he referred to Greater Miami from the state court system, and when Konell referred more patients to Greater Miami, his co-conspirators found ways to pay him over and above his regular kickback payments, including by providing him with holiday bonuses.
In furtherance of the kickback conspiracy, Konell made representations to judges and others in the Miami-Dade state court system that the individuals he referred to Greater Miami received medically necessary PHP services from Greater Miami when in reality such services were not always needed, he admitted.
According to plea documents, Konell’s co-conspirators caused the submission of over $63 million in false and fraudulent claims to Medicare. These claims were based on kickbacks and/or bribes paid to Konell and others and were for services that were medically unnecessary, were not eligible for Medicare reimbursement or were never provided by Greater Miami. Konell admitted that his participation in the Greater Miami scheme resulted in the submission of claims to Medicare totaling between at least approximately $9.5 and $25 million.
Eleven other individuals have pleaded guilty and have been sentenced for their roles in the scheme, including the owner of Greater Miami, three administrators and seven patient brokers.
This case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. Former Senior Trial Attorney Christopher J. Hunter and Trial Attorneys Elizabeth Young and Leslie Wright of the Fraud Section prosecuted the case. Assistant U.S. Attorney Adrienne Rosen of the Southern District of Florida is handling the forfeiture aspects of the case.
The Medicare Fraud Strike Force operations are part of a joint initiative between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations nationwide. Since its inception in March 2007, the Medicare Fraud Strike Force has charged over 3,500 defendants who collectively have falsely billed the Medicare program for over $12.5 billion.
Miami-Area Man Sentenced to Five Years in Prison for Role in $63 Million Health Care Fraud SchemeRead the Press Release
A Miami-area man was sentenced to 60 months in prison today for his role in a $63 million health care fraud scheme involving a now-defunct community mental health center located in Miami that purported to provide partial hospitalization program (PHP) services to individuals suffering from mental illness.
U.S. Attorney Benjamin G. Greenberg of the Southern District of Florida, Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, Special Agent in Charge Robert Lasky of the FBI’s Miami Field Office and Special Agent in Charge Shimon R. Richmond of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office made the announcement.
Samuel Konell, 70, of Boca Raton, Florida, was sentenced by U.S. District Judge Jose E. Martinez of the Southern District of Florida. Judge Martinez also ordered Konell to pay $9,921,726 in restitution and to forfeit certain substitute assets, including several pieces of jewelry, in partial satisfaction of a personal money judgment entered against the defendant in the amount of $432,829. Konell pleaded guilty on Nov. 21, 2017, to one count of conspiracy to defraud the United States and receive health care kickbacks.
As part of his guilty plea, Konell admitted that from approximately January 2006 through June 2012, he received kickbacks and/or bribes in return for referring Medicare beneficiaries from the Miami-Dade state court system to Greater Miami Behavioral Healthcare Center Inc. (Greater Miami) to serve as patients. He admitted that he coordinated with criminal defendants in the state court system to obtain court orders for mental health treatment in lieu of incarceration so that he could refer those individuals to Greater Miami to serve as patients in return for kickbacks and/or bribes. Konell further admitted that he did so knowing that certain of those individuals were not mentally ill or otherwise did not meet the criteria for PHP treatment.
In addition, Konell admitted that he and his co-conspirators at Greater Miami took steps to disguise the true nature of the kickbacks and/or bribes that Greater Miami paid to Konell and other patient brokers. Specifically, Konell was placed on the Greater Miami payroll to make the kickbacks and/or bribes appear as though they were legitimate salary payments, he admitted. Konell further admitted that he was originally paid a flat monthly rate that was based on the number of patients he referred to Greater Miami from the state court system, and when Konell referred more patients to Greater Miami, his co-conspirators found ways to pay him over and above his regular kickback payments, including by providing him with holiday bonuses.
In furtherance of the kickback conspiracy, Konell made representations to judges and others in the Miami-Dade state court system that the individuals he referred to Greater Miami received medically necessary PHP services from Greater Miami when in reality such services were not always needed, he admitted.
According to plea documents, Konell’s co-conspirators caused the submission of over $63 million in false and fraudulent claims to Medicare. These claims were based on kickbacks and/or bribes paid to Konell and others and were for services that were medically unnecessary, were not eligible for Medicare reimbursement or were never provided by Greater Miami. Konell admitted that his participation in the Greater Miami scheme resulted in the submission of claims to Medicare totaling between at least approximately $9.5 and $25 million.
Eleven other individuals have pleaded guilty and have been sentenced for their roles in the scheme, including the owner of Greater Miami, three administrators and seven patient brokers.
This case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. Former Senior Trial Attorney Christopher J. Hunter and Trial Attorneys Elizabeth Young and Leslie Wright of the Fraud Section prosecuted the case. Assistant U.S. Attorney Adrienne Rosen of the Southern District of Florida is handling the forfeiture aspects of the case.
The Medicare Fraud Strike Force operations are part of a joint initiative between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations nationwide. Since its inception in March 2007, the Medicare Fraud Strike Force has charged over 3,500 defendants who collectively have falsely billed the Medicare program for over $12.5 billion.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Former Research Oceanographer Sentenced for Accepting a Salary from the People’s Republic of ChinaRead the Press Release
A former research oceanographer in the Atlantic Oceanographic and Meteorological Laboratory (AOML) of the National Oceanic and Atmospheric Administration (NOAA), an agency of the U.S. Department of Commerce, has been sentenced for accepting a salary from the People’s Republic of China.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, George Lee, Special Agent in Charge, U.S. Department of Commerce (DOC), Investigations and Threat Management Division, Duane Townsend, Special Agent in Charge, U.S. Department of Commerce, Office of Inspector General (DOC-OIG), and Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, made the announcement.
According to court documents, Chunzai Wang, 56, of Miami, was one of the foremost experts on ocean-atmosphere interaction, climate change, and hurricanes in the world. NOAA is an agency of the United States Department of Commerce. While a NOAA/AOML employee, Wang knowingly and willfully received a salary for his services as an employee of NOAA/AOML, from the People’s Republic of China, Changjiang Scholars Program, in violation of Title 18, United States Code, Sections 209(a) and 216(a)(2).
Specifically, beginning in 2010, and while employed at NOAA, Wang entered into contractual agreements to work on China’s Changjiang Scholars Program, Thousand Talents Program, and was also involved in China’s 973 Program which mobilizes scientific talents to strengthen basic research in line with national strategic targets of the People’s Republic of China.
Wang was sentenced to a term of time served.
Mr. Greenberg commended the investigative efforts of the United States Department of Commerce and the FBI. The case was being prosecuted by Assistant United States Attorney Michael Walleisa.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Former Jewelry Store Manager Pleads Guilty to Bank FraudRead the Press Release
Frank Dunkow, 52, of Wellington, pled guilty before United States District Judge Robin L. Rosenberg, to bank fraud involving his repeated sales of jewelry to individuals using counterfeit credit cards in 2010-2011.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, Ric Bradshaw, Sheriff, Palm Beach County Sheriff’s Office (PBSO), Antonio J. Gomez, Inspector in Charge, U.S. Postal Inspection Service (USPIS), Miami Division, and Brian Swain, Special Agent in Charge, U.S. Secret Service (USSS), Miami Field Office, made the announcement.
Dunkow pled guilty to Count 5 of the Indictment, which charged him with bank fraud, in violation of Title 18, United States Code, Section 1344(2) (Case No. 17-CR-80192-CR-ROSENBERG). At sentencing, he faces a maximum of 30 years imprisonment and up to $1 million in fines.
According to the court record, Dunkow was the store manager at Littman Jewelers in the Wellington Mall and directed his employees to accept counterfeit credit cards used by individuals on numerous occasions to buy expensive pieces of jewelry. Often, the first credit card presented by the co-conspirators would be declined, leading the buyers to present a second, third, or more credit cards until the charge was processed.
Between June 2010 and March 2011, dozens of such sales were processed by Dunkow and his staff, leading to just under $400,000 in financial losses.
Mr. Greenberg commended the investigative efforts of PBSO, USPIS and USSS. This case is being prosecuted by Assistant United States Attorneys Lauren Jorgensen and Alexandra Chase.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Foreign National Arrested on Second-Degree Murder ChargeRead the Press Release
Lewis Bennett, 41, a dual citizen of Australia and the United Kingdom, was arrested by the FBI on a criminal complaint charging him with second-degree murder of his wife, Isabella Hellman, within the special maritime and territorial jurisdiction of the United States.
Benjamin G. Greenberg, United States Attorney of the Southern District of Florida, Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Thomas E. Robarge, Special Agent in Charge, United States Coast Guard Investigative Service (CGIS), Southeast Region, made the announcement.
The complaint charges Bennett with second-degree murder of Hellman, a naturalized U.S. citizen, in violation of Title 18, United States Code, Section 1111(a). Bennett was arrested in Miami on February 20, 2018.
According to the criminal complaint, in the early morning of May 15, 2017, the United States Coast Guard (USCG) received an emergency alert approximately 26 nautical miles from Cay Sal Bank, Bahamas, in international waters. Bennett also reported via phone that he was in distress in the same general location around the same time.
It is alleged that Bennett reported he was on board an approximately 40-foot catamaran with his wife, Hellman, sailing from Cuba to Florida. Bennett stated that he had retired below to sleep, leaving Hellman on watch, and was awoken by a crash. Bennett claimed that he moved topside, and Hellman was not there. Bennett indicated that he eventually realized the catamaran was taking on water, gathered his belongings, and abandoned ship to his life raft.
According to the complaint, an USCG helicopter ultimately rescued Bennett from a life raft in international waters, but Hellman was never located. During the search and rescue operation for Hellman, USCG took video and photographs of Bennett’s capsized catamaran. Video and photographs of the catamaran appear to show that damage to a small portion of each hull was in nearly the exact same location and came from the inside of the catamaran. These videos and photographs also showed that two escape hatches were open, which would cause water to enter the catamaran.
The complaint alleges that an associate professor of naval architecture, who analyzed evidence collected in the investigation, stated in a report detailing his findings that it did not appear the catamaran sinking was caused by accidental damage; rather, that the catamaran was scuttled. The complaint also alleges that Bennett did not activate his satellite phone and register his Personal Locator Beacon, until he was in Cuba in mid-May 2017, after he and Hellman had already traveled from St. Maarten to Puerto Rico, and from Puerto Rico to Cuba. It is alleged that the voyage from St. Maarten would have warranted having an activated satellite phone and registered Personal Locator Beacon as life-saving devices. However, Bennett allegedly waited to activate those devices until the final leg of his voyage to ensure his own rescue and survival after murdering his wife and intentionally scuttling his catamaran.
“The arrest of Mr. Bennett is the result of the vigorous investigation by prosecutors in this office and our federal law enforcement partners. Together, we were able to uncover the truth about what occurred aboard the catamaran, resulting in a tragic death,” stated U.S. Attorney Benjamin G. Greenberg.
“The FBI has the authority to investigate specific violent crimes committed against Americans and American interests overseas, including crimes on the high seas,” said Robert F. Lasky, Special Agent in Charge, FBI Miami. “We take this responsibility seriously. We commend the U.S. Coast Guard for their professionalism and close cooperation with this case.”
“The Coast Guard Investigative Service prides itself in being one of the premiere maritime law enforcement agencies, conducting professional and thorough maritime investigations,” said Thomas E. Robarge, Special Agent in Charge, CGIS Southeast Region. “We are honored to have worked jointly with the FBI and U.S. Attorney’s Office in reaching said objective.”
Bennett is scheduled to make his initial appearance before U.S. Magistrate Judge Edwin G. Torres, on February 21, 2018, at 2 p.m. If convicted, Bennet faces a potential maximum sentence of life imprisonment.
Mr. Greenberg commended the investigative efforts of the FBI and CGIS in this matter. This case is being prosecuted by Assistant U.S. Attorney Kurt K. Lunkenheimer and Special Assistant U.S. Attorney Emily A. Rose.
A criminal complaint is merely an allegation and every defendant is presumed innocent until proven guilty.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Woman Convicted for Involvement in Conspiracy to Commit Extortion and Violations of the Travel ActRead the Press Release
Brigith Dayana Gomez, 29, a resident of Los Angeles, California and Venezuela, was convicted for her involvement in a conspiracy to commit extortion and violations of the Travel Act.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, and Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, made the announcement.
The extortion plot sought approximately $100,000 from the victim, and the evidence presented at trial established that Gomez and her co-conspirator, Carolina Del Carmen Roldan, threatened to expose compromising photographs and videos of the victim to Telemundo (the media) unless he paid them.
After a two-week trial, a federal jury found Gomez guilty of all five counts charged in the indictment: one count of conspiracy to transmit extortionate communications in interstate commerce, three counts of transmission of extortionate threats in interstate commerce, and one count of interstate travel in aid of racketeering.
According to evidence presented at trial, Gomez, a purported model, and co-conspirator Carolina Roldan threatened their victim with exposure of compromising photographs and videos of him having affairs with multiple women, unless he paid $50-$100,000 in cash. Over the next fifteen days, the demands for money and threats continued. The FBI apprehended Gomez at Miami International Airport when she arrived to attempt to collect the money from the victim.
Sentencing is scheduled for April 25, 2018 at 3 p.m. before U.S. District Judge Joan A. Lenard. Gomez faces up to five years’ imprisonment for Counts 1 and 5 of the Indictment, and up to two years’ imprisonment for Counts 2 through 4 of the Indictment.
Mr. Greenberg commended the investigative efforts of the FBI. The case is being prosecuted by Assistant United States Attorneys Lisa H. Miller, Frederic Shadley, and Anne McNamara.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Cuban National Indicted on Federal Charges of Labor Trafficking, Alien Smuggling, Loan Sharking, and Identity TheftRead the Press Release
A Cuban national, living in Palm Beach County, was arrested in Las Vegas, Nevada, on February 12, after being charged with labor trafficking, alien smuggling, loan sharking and identity theft.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, Mark Selby, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, (ICE-HSI), and Ric Bradshaw, Sheriff, Palm Beach County Sheriff’s Office, (PBSO), made the announcement.
Ivan Madrigal Zamora, 56, of Cuba, who was living in Palm Beach County, was charged by indictment with one count of forced labor trafficking, in violation of Title 18, United States Code, Section 1589(a), one count of aggravated identity theft, in violation of Title 18, United States Code, Section 1028A(a)(1), one count of production of a false identification document, in violation of Title 18, United States Code, Section 1028(a)(1), one count of loan sharking, in violation of Title 18, United States Code, Section 894(a)(1), and one count of encouraging and inducing an alien to reside in the United States, in violation of Title 8, United States Code, Section 1324(a)(1)(A)(iv) & (B)(i). If convicted on all charges, Zamora faces a combined statutory maximum sentence of 62 years in prison. Zamora is currently being detained without bond pending further court proceedings in West Palm Beach.
According to court records, from in July 2017, Zamora obtained forced labor from the victim and used extortionate means to collect a debt from the victim. From December 2016 through July 2017, Zamora procured a fake Florida driver license and encouraged or induced an illegal alien come to, enter and reside in the United States.
Mr. Greenberg commended the investigation efforts of ICE-HSI and PBSO and the partnership of the Palm Beach County Human Trafficking Task Force. This case is being prosecuted by Assistant United States Attorney Gregory Schiller.
An indictment merely an accusation and a defendant is presumed innocent unless and until proven guilty.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Two Indian Citizens and India-based Corporation Sentenced for Conspiring to Smuggle Counterfeit CigarettesRead the Press Release
Abhishek Shukla and Harish Shabhai Panchal, both citizens of India, along with the India-based company, Jubilee Tobacco Industries Corp., were sentenced in federal District Court in Miami, for conspiring to smuggle counterfeit cigarettes into the United States.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, Peter H. Kuehl, Acting Special Agent in Charge, U.S. Food & Drug Administration, Office of Criminal Investigations (FDA-OCI), Miami Field Office, Mark Selby, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), Miami Field Office, and Scott Israel, Sheriff, Broward County Sheriff’s Office (BSO), made the announcement.
U.S. District Judge Kathleen M. Williams sentenced each of Shukla and Panchal to 23 months imprisonment, to be followed by supervised release for two years. Judge Williams sentenced Jubilee to corporate probation of two years and ordered Jubilee to forfeit $300,000 to the United States.
All three defendants previously pled guilty to conspiring with each other, with the intent to defraud and mislead, sell and cause the sale and dispensing of a counterfeit tobacco product (cigarettes), the containers and labeling of which bore the trade name and marks of the American brand of Newport cigarettes, a tobacco product listed with the FDA pursuant to Title 21, United States Code, Section 387(e)(i)(1), (approximately 68,600 cartons of cigarettes), while knowingly using a counterfeit mark on and in connection with such cigarettes, the use of which marks was likely to cause confusion, to cause mistake, and to deceive. The counterfeit marks were substantially indistinguishable from the marks of the United States domestic manufacturer of Newport brand cigarettes, which marks were then in use by and registered to that manufacturer on the principal register of the United States Patent and Trademark Office, all in violation of Title 18, United States Code, Section 371.
According to court records, including a Joint Factual Statement submitted by the parties, beginning in March 2015 and continuing through August 16, 2017, the defendants initiated contact with an individual cooperating with FDA-OCI, offering counterfeit cigarettes for sale. Through internet negotiations, an agreement was reached for a 20-foot container filled with counterfeit Newport brand cigarettes to be shipped from India to Miami. Payment for the shipment was made in installments through international wire transfers to bank accounts in India and in Dubai, United Arab Emirates. On November 1, 2016, the container arrived and was seized at the Port of Miami with the assistance of U.S. Customs and Border Protection Officers. If distributed in the State of Florida, the un-taxed importation would have an approximate value of $1.2 million. Analysis conducted by FDA’s Forensic Chemistry Center determined that the cartons, packs, and cigarettes were all counterfeit.
Within two weeks of the arrival, the coconspirators sought out FDA-OCI undercover agents offering another shipment, twice as large. By April 2017, deposits totaling $55,000 had been made for more counterfeit Newport cigarettes. On June 9, 2017, the container arrived at the Port of Miami and was again seized with the assistance of Customs and Border Protection Officers, and turned over to FDA-OCI Special Agents. If distributed in the State of Florida, the un-taxed importation would have an approximate value of $3.2 million.
According to acts described in the conspiracy charge, Shukla and Panchal traveled to Miami in August 2017 to meet with the undercover agents to promote further business dealings. During the recorded meeting, they advised the agents that they had been partners for twelve years and personally oversaw the production of all the products being offered. They also assured the agents that they could counterfeit any American-made menthol cigarette with no problem, as well as other trademarked brands, and that they could produce tobacco blends, which would closely match the legitimate product.
Mr. Greenberg commended the investigative efforts of FDA-OCI, ICE-HSI and BSO, for their assistance with this long-term investigation. Mr. Greenberg also thanked U.S. Customs and Border Protection for their support. This matter was prosecuted by Assistant U.S. Attorney Thomas Watts-FitzGerald.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Five Defendants Plead Guilty to Methamphetamine Trafficking ChargesRead the Press Release
Five defendants pled guilty in unrelated cases to methamphetamine trafficking charges in the Southern District of Florida.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, Adolphus P. Wright, Special Agent in Charge, U.S. Drug Enforcement Administration (DEA), Miami Field Division, and Mark Selby, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), Miami Field Office, made the announcement.
On January 18, 2018 and January 30, 2018, respectively, Saul Bustos Bustos, 38, and Irepan Juanchi Salgado, 24, each of Mexico, pled guilty to conspiring to possess with intent to distribute 500 grams or more of a mixture and substance containing a detectable amount of methamphetamine, in violation of 21 U.S.C. § 846. According to court records, the defendants met on November 28, 2017, with a DEA undercover officer in Miami to sell him five kilograms of crystal methamphetamine, at $14,500 per kilo. During the transaction, the defendants, who possessed a total of 3,717 grams of 98% pure crystal methamphetamine, worked together to transfer the drugs from their vehicle to the undercover officer. Bustos Bustos also pled guilty to illegal reentry after removal, after reentering the United States subsequent to removal on April 13, 2017, July 6, 2017, and July 19, 2017.
On January 31, 2018, Reitilly Fuentes Ramos, 32, of Miami-Dade County, pled guilty to possession with intent to distribute 50 grams or more of methamphetamine, in violation of 21 U.S.C. § 841(a)(1). According to court records, on October 25, Fuentes Ramos distributed 56.2 grams of 100% pure methamphetamine to a DEA confidential source. Following that transaction, the confidential source purchased an additional four ounces of crystal methamphetamine from Fuentes Ramos. During execution of a search warrant at the residence of Fuentes Ramos, agents seized four more ounces of crystal methamphetamine as well as distribution quantities of cocaine.
On January 30, 2018 and February 9, 2018, respectively, Jeremy Robert Macroy, 30, and Andrew Ronald Lord, 38, each of Broward County, pled guilty to conspiring to possess with intent to distribute 50 grams or more of a mixture and substance containing a detectable amount of methamphetamine, in violation of 21 U.S.C. § 846. According to court records, Macroy and Lord facilitated the mailing of a UPS parcel from California to Hollywood, Florida, containing crystal methamphetamine. On November 15, 2017, Lord picked up the package, a portion of which he intended to distribute to Macroy. A search of the parcel revealed that it contained 430.3 grams of 98% pure methamphetamine.
At sentencing, Bustos Bustos and Juanchi Salgado face potential prison sentences of up to life imprisonment, to be followed by supervised release terms of at least five years on their respective narcotics convictions. Bustos Bustos also faces a maximum term of three years imprisonment, to be followed by up to three years supervised release, for his immigration violation. Bustos Bustos is scheduled to be sentenced before United States District Judge K. Michael Moore on March 29, 2018, at 2:00 p.m. A sentencing date for Juanchi Salgado has not been scheduled.
Fuentes Ramos faces a potential prison sentence of up to life imprisonment, to be followed by supervised release of at least five years. Fuentes Ramos is scheduled to be sentenced before United States District Judge K. Michael Moore on April 11, 2018, at 2:00 p.m.
Macroy and Lord face potential prison sentences of up to 40 years, to be followed by supervised release terms of at least four years. Macroy and Lord are scheduled to be sentenced before United States District Judge Beth Bloom on April 30, 2018, at 10:30 a.m., and April 24, 2018, at 2:30 p.m., respectively.
Mr. Greenberg commends the investigative efforts of DEA and ICE-HSI. These cases are being prosecuted by Assistant U.S. Attorney Jonathan K. Osborne.
This investigation and prosecution was carried out by members of the South Florida High Intensity Drug Trafficking Area (HIDTA) Task Force. The South Florida HIDTA, established in 1990, is made up of federal, state and local law enforcement agencies that, cooperatively, target the region’s drug-trafficking and money laundering organizations. The South Florida HIDTA is funded by the Office of National Drug Control Policy which sponsors a variety of initiatives focused the nation’s illicit drug trafficking threats.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Hialeah Man Convicted of Conspiracy to Possess with Intent to Distribute Five Kilograms or More of CocaineRead the Press Release
A Miami jury convicted a Hialeah resident of conspiracy to possess with intent to distribute five kilograms or more of cocaine after a five-day trial.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Juan J. Perez, Director, Miami-Dade Police Department (MDPD), made the announcement.
Maikel Vigil Gallardo, 35, was convicted of one count of conspiracy to possess with intent to distribute 5 kilograms or more of cocaine, in violation of 21 U.S.C. § 846. He faces a statutory maximum of life imprisonment, and sentencing is scheduled before U.S. District Judge Marcia G. Cooke, on April 25, 2018, at 10:30 a.m.
The evidence presented at trial established that in April 2017, Gallardo met on multiple occasions with an FBI confidential human source (“CHS”) to develop a multi-kilogram cocaine pipeline from Miami to Chicago, Illinois. During the trial, the United States introduced recordings from these meetings, in which Gallardo talked about his experiences trafficking cocaine and marijuana around the United States, using trucking routes and paid off customs checkpoints to evade law enforcement. On April 26, Gallardo delivered a one-kilogram sample of cocaine to the CHS in the Orlando area, which triggered his arrest.
Mr. Greenberg commended the investigative efforts of the FBI and MDPD. This case is being prosecuted by Assistant U.S. Attorneys Jonathan K. Osborne and Breezye Telfair.
This investigation and prosecution was carried out by members of the South Florida High Intensity Drug Trafficking Area (HIDTA) Task Force. The South Florida HIDTA, established in 1990, is made up of federal, state and local law enforcement agencies who, cooperatively, target the region’s drug-trafficking and money laundering organizations. The South Florida HIDTA is funded by the Office of National Drug Control Policy which sponsors a variety of initiatives focused the nation’s illicit drug trafficking threats.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Broward Doctor and Staff Arrested for Running a Pill MillRead the Press Release
Dr. Andres Mencia, 64, of Ft. Lauderdale, Oscar Luis Ventura-Rodriguez, 41, of Ft. Lauderdale, Nadira Sampath-Grant, 51, of Margate, and John Mensah, 50, of Miami, were arrested for their involvement in a scheme where they billed Medicare and Medicaid for medical consultations during which in actuality, they issued prescriptions for opioids and other drugs in exchange for cash payments, in violation of 21 U.S.C. § 846 and 841(a)(1), 18 U.S.C. § 2, 18 U.S.C. § 1347 and 18 U.S.C. § 1349.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, Adolphus P. Wright, Special Agent in Charge, U.S. Drug Enforcement Administration (DEA), Miami Field Division, Shimon R. Richmond, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), and Mark Selby, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), Miami Field Office, made the announcement.
As alleged in the indictment, beginning in or around January 2015, Dr. Mencia, Venutra-Rodriguez, Sampath-Grant and Mensah conspired to perform sham consultations with Medicare and Medicaid beneficiaries and other patients, the true intent of which was to issue them prescriptions for opioids and other drugs in exchange for cash payments. In some instances, the defendants billed Medicare and Medicaid for these consultations and the prescriptions were filled at Medicare and Medicaid participating pharmacies.
Ventura-Rodriguez, Sampath-Grant and Mensah are charged with knowingly and intentionally dispensing a controlled substance, in violation of 21 U.S.C. § 846 and 841(a)(1) and 18 U.S.C. § 2.
Dr. Mencia is also charged with knowingly and intentionally dispensed a controlled substance, in violation of 21 U.S.C. § 846 and 841(a)(1) and 18 U.S.C. § 2. The indictment further alleges that Dr. Mencia purchased two residential properties with the illicit proceeds, in violation of 18 U.S.C. § 1957.
If convicted on all charges, each defendant faces a possible maximum sentence of up to 20 years imprisonment on each count.
Mr. Greenberg commended the investigative efforts of DEA, HHS-OIG and ICE-HSI. Mr. Greenberg also thanked the Aventura Police Department, City of Miami Police Department, Miami-Dade Police Department, and Miami Gardens Police Department. This case is being prosecuted by Assistant United States Attorney Michael Gilfarb.
An indictment is merely an allegation and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
West Palm Beach, Florida Man Pleads Guilty to Conspiring to Provide Material Support to ISISRead the Press Release
Gregory Hubbard, aka Jibreel, 54, of West Palm Beach, Florida, pleaded guilty on Feb. 8, to conspiring to provide material support to the Islamic State of Iraq and al-Sham (ISIS), a designated foreign terrorist organization.
U.S. Attorney Benjamin G. Greenberg for the Southern District of Florida, Acting Assistant Attorney General for National Security Edward O’Callaghan, Special Agent in Charge Robert F. Lasky of the FBI’s Miami Field Office, and members of the South Florida Joint Terrorism Task Force (JTTF), made the announcement. The plea was entered before U.S. District Judge Robin L. Rosenberg.
“Individuals seeking to travel to take up arms with ISIS pose a threat to the security of all nations,” said U.S. Attorney Greenberg. “The U.S. Attorney’s Office, the FBI, and the Joint Terrorism Task Force continue to work proactively in order to stifle and disrupt any potential danger posed by terrorist organizations and their supporters.”
“Gregory Hubbard and his cohorts conspired to provide material support to ISIS, a designated foreign terrorist organization,” said Robert F. Lasky, Special Agent in Charge, FBI Miami. “Stopping terrorists before they can act is serious business that requires dedicated law enforcement professionals and eternal vigilance. This vigilance includes anyone and everyone who sees or hears something that seems out of place. If you see something, say something.”
According to the factual basis, Hubbard was arrested on July 21, 2016, at Miami International Airport where he and an FBI confidential human source (CHS) had been driven by co-defendant Jackson for a scheduled flight to Berlin, Germany. From Berlin, Hubbard intended to travel to Syria to join ISIS.
At various times during the conspiracy, which ran from approximately July 2015 until Hubbard’s arrest, Hubbard, and his co-defendants, Dayne Antani Christian and Darren Arness Jackson, talked with the CHS about their support for ISIS and jihad, including acts of terrorism committed by and attributed to ISIS and its supporters. During the conspiracy, Hubbard and his co-defendants including the CHS and others, practiced shooting weapons multiple times in preparation for Hubbard and the CHS traveling to Syria to join ISIS.
Hubbard faces a statutory maximum sentence of 20 years in prison. A sentencing date of April 19, has been set. Christian pleaded guilty, on March 29, 2017 to conspiracy to provide material support to ISIS, and to one count of being a felon in possession of a firearm. Jackson pleaded guilty on April 4, 2017, to conspiracy to provide material support to ISIS. Christian and Jackson both face a statutory maximum sentence of 20 years in prison on the conspiracy plea. Christian faces an additional statutory maximum sentence of 10 years in prison for his plea to being a felon in possession of a firearm. Both co-defendants are scheduled to be sentenced following Hubbard’s sentencing in April.
The FBI and JTTF investigated the case with assistance from the Bureau of Alcohol, Tobacco, Firearms and Explosives; Transportation Security Administration; Miami International Airport Police Department; Boca Raton, Florida, Police Department; Palm Beach Sheriff’s Office; City of West Palm Beach Police Department; and Florida Fish and Wildlife Conservation Commission. This case is being prosecuted by Assistant U.S. Attorneys Karen E. Gilbert and Edward C. Nucci and Trial Attorneys Larry Schneider and Bridget Behling of the National Security Division’s Counterterrorism Section.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Tampa Resident Convicted for Involvement with Tricare Health Care Fraud SchemeRead the Press Release
Tampa resident convicted in federal court in the Southern District of Florida for his involvement in Tricare health care fraud scheme, kickbacks and money laundering.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, John F. Khin, Special Agent in Charge, Defense Criminal Investigative Services (DCIS), Southeast Field Office, Peter H. Kuehl, Acting Special Agent in Charge, U.S. Food and Drug Administration’s Office of Criminal Investigations (FDA-OCI), Miami Field Office, and Frank Robey, Director, U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit, made the announcement.
On February 5, 2018, a federal jury in Miami unanimously convicted Monty Ray Grow, 46, on 18 criminal counts including conspiracy to commit health care fraud, in violation of 18 U.S.C. § 1347; conspiracy to pay and receive health care kickbacks, in violation of 18 U.S.C. § 371; unlawful receipt of health care kickbacks, in violation of 42 U.S.C. § 1320a-7(b)(1)(A); and money laundering, in violation of 18 U.S.C. § 1957.
Evidence presented at trial established that during an 8-month span in 2014-15, Grow participated in a scheme to defraud the Tricare program out of tens of millions of dollars. Tricare is the health care program for the U.S. military that pays the health care costs of active and retired military personnel and their families. That insurance benefit includes paying for any medications that a Tricare beneficiary needs. Grow enticed Tricare beneficiaries to order very expensive drugs that they did not need. Tricare, not the patients, paid the bill for these expensive drugs and the pharmacy split 50% of the profits with Grow. Evidence at trial established that Grow targeted Tricare beneficiaries and induced them to order expensive drugs they did not need by paying them either directly for their own prescriptions or indirectly for those of their family and friends. As a result of that scheme, Grow received nearly $20 million in kickbacks from a Broward County pharmacy.
In furtherance of his fraud scheme, Grow fraudulently inflated the price the pharmacy would bill to Tricare by manipulating the formulations and selling ingredients to the pharmacy that were artificially engineered in order to maximize profits. Grow also paid telemedicine companies whose doctors ratified those prescriptions he pre-selected with the knowledge that no doctor ever examined a single patient. Finally, Grow laundered the criminal proceeds of his scheme through the purchase of luxury items.
To date, at least eight additional co-conspirators have pleaded guilty to federal criminal charges arising out of Grow’s fraud scheme, including Ginger Lay, 40, of Atlanta, Georgia; Paul Robinson, 40, of Ormond Beach, Florida; Deanna Dutting, 40, of Ormond Beach, Florida, Raymond Bear, 46, of Flemming Island, Florida; Robin Halliburton, 45 of Ponte Vedra, Florida; Michael Shane Matthews, 47, of Newberry, Florida, Michael Bowman, 43, of Jacksonville, Florida, and Sven Bjerke, 39, of Jacksonville, Florida. These individuals have collectively remitted property back to the United States valued in the approximate amount of $3.3 million. Grow is scheduled to be sentenced before U.S. District Judge Federico A. Moreno on April 16, 2018, at 9:30 a.m.
“Monty Grow has been held responsible for an egregious fraud scheme that unlawfully diverted approximately $20 million in federal health care monies that were set aside for the men and women in uniform who serve and protect our country and jeopardized the public’s health for personal gain,” stated United States Attorney Benjamin G. Greenberg. “The U.S. Attorney’s Office and our law enforcement partners will continue to work tirelessly to identify for prosecution individuals, including healthcare providers, who not only carry out fraudulent schemes against Tricare or other federal health care programs for their own personal financial benefit at a loss to the deserving beneficiaries, but also endanger our community.”
“The Defense Criminal Investigative Service is committed to protecting the integrity of the U.S. military health care program to provide top quality medical care to America’s Warfighters and their families, while ensuring that health care providers and facilities comply with Federal laws,” said John F. Khin, Special Agent in Charge, DCIS - Southeast Field Office. “Through joint investigations with our law enforcement partners, DCIS aggressively pursues criminal prosecutions and all available remedies to bring violators to justice. This guilty verdict demonstrate the effectiveness of our investigative efforts.”
“The FDA is committed to working with our law enforcement partners to bring to justice those who place their personal gain over the health of American consumers,” said Peter Kuehl, Acting Special Agent in Charge, U.S. Food and Drug Administration's Office of Criminal Investigations, Miami Field Office. “We commend the efforts of the Department of Justice for vigorously pursuing the prosecution of this matter.”
“We are extremely pleased with the jury’s verdict in this case,” said Frank Robey, Director of the U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit. “To in any way be culpable in swindling millions of dollars from a federal program that provides medical insurance for the U.S. military is completely unconscionable to me. Agents from our specialized fraud unit, along with investigators from other federal law enforcement agencies, are unwavering in our commitment to seek out and hold responsible all those who conduct criminal activity against the United States Army and the American taxpayer.”
Mr. Greenberg commended the investigative efforts of DCIS, FDA-OCI and U.S. Army CID. This case is being prosecuted by Assistant United States Attorneys Kevin J. Larsen and Jon Juenger.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Florida Man Pleads Guilty to Conspiring to Provide Material Support to ISISRead the Press Release
Gregory Hubbard, aka Jibreel, 54, of West Palm Beach, Florida, pleaded guilty on Feb. 8, to conspiring to provide material support to the Islamic State of Iraq and al-Sham (ISIS), a designated foreign terrorist organization.
Acting Assistant Attorney General for National Security Edward O’Callaghan, U.S. Attorney Benjamin G. Greenberg for the Southern District of Florida, Special Agent in Charge Robert F. Lasky of the FBI’s Miami Field Office, and members of the South Florida Joint Terrorism Task Force (JTTF), made the announcement. The plea was entered before U.S. District Judge Robin L. Rosenberg
According to the factual basis, Hubbard was arrested on July 21, 2016, at Miami International Airport where he and an FBI confidential human source (CHS) had been driven by co-defendant Darren Arness Jackson for a scheduled flight to Berlin, Germany. From Berlin, Hubbard intended to travel to Syria to join ISIS.
At various times during the conspiracy, which ran from approximately July 2015 until Hubbard’s arrest, Hubbard, and his co-defendants, Dayne Antani Christian and Jackson, talked with the CHS about their support for ISIS and jihad, including acts of terrorism committed by and attributed to ISIS and its supporters. During the conspiracy, Hubbard and his co-defendants including the CHS and others, practiced shooting weapons multiple times in preparation for Hubbard and the CHS traveling to Syria to join ISIS.
Hubbard, a U.S. citizen, will be sentenced on April 19, and faces a statutory maximum sentence of 20 years in prison. Christian pleaded guilty on March 29, 2017, to conspiracy to provide material support to ISIS, and to one count of being a felon in possession of a firearm. Jackson pleaded guilty on April 4, 2017, to conspiracy to provide material support to ISIS. Christian and Jackson both face a statutory maximum sentence of 20 years in prison on the conspiracy plea. Christian faces an additional statutory maximum sentence of 10 years in prison for his plea to being a felon in possession of a firearm. Both co-defendants are scheduled to be sentenced following Hubbard’s sentencing in April.
The FBI and JTTF investigated the case with assistance from the Bureau of Alcohol, Tobacco, Firearms and Explosives; Transportation Security Administration; Miami International Airport Police Department; Boca Raton, Florida, Police Department; Palm Beach Sheriff’s Office; City of West Palm Beach Police Department; and Florida Fish and Wildlife Conservation Commission. This case is being prosecuted by Assistant U.S. Attorneys Karen E. Gilbert and Edward C. Nucci and Trial Attorneys Larry Schneider and Bridget Behling of the National Security Division’s Counterterrorism Section.
Four Defendants Sentenced for Participating in Stolen Identity Refund Fraud SchemeRead the Press Release
Four defendants were sentenced for their participation in a stolen identity refund fraud scheme.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, and Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), made the announcement.
Masoniek Stinfort, 32, of Belle Glade, was sentenced to 144 months in prison, to be followed by three years of supervised release, and was ordered to pay restitution in the amount of $409,968. Eric L. Clemons, Jr., 25, formerly of Belle Glade, was sentenced to 48 months in prison, to be followed by three years of supervised release, and was ordered to pay restitution in the amount of $409,968. James Craig, 29, of Orlando, FL was sentenced to 34 months in prison, to be followed by two years of supervised release. Robert Nero, 30, Belle Glade, was sentenced to 27 months in prison, to be followed by 3 years of supervised release.
Stinfort, Clemons, and Clorinda Walker, of Belle Glade previously pled guilty to one count of conspiracy to commit wire fraud and theft of government funds, in violation of Title 18, United States Code, Section 371. Stinfort also pled guilty to five counts of wire fraud, in violation of Title 18, United States Code, Section 1343; and five counts of aggravated identity theft, in violation of Title 18, United States Code, Section 1028A. Clemons, Craig, Nero and Walker also pled guilty to one count of wire fraud and one count of aggravated identity theft.
According to court documents, the defendants participated in a scheme where fraudulent federal income tax returns were filed with the IRS using unauthorized personal identifying information (PII), consisting of names and social security numbers, of real persons. Stinfort recruited numerous individuals including, among others, Clemons, Walker, Nero, and Craig to open bank accounts to be used to receive the fraudulent tax refunds obtained by the submission of the false federal income tax returns. The defendants sought $1,118,000 in fraudulent refunds from the IRS, and the government sustained an actual loss of $409,968 attributable to the fraud.
Defendant Walker was employed by a medical center where she had access to the PII of individual patients. Specifically, Walker had access to the patients’ names, respective social security numbers and respective dates of birth. A number of PII stolen from the medical center were used in the stolen identity refund fraud conspiracy. Walker was the source of some, but not all, of the stolen PII used in the conspiracy to defraud the United States. Walker is scheduled to be sentenced before U.S. District Judge Robin L. Rosenberg on Friday, February 16, 2018, at 1:30 p.m.
Defendant Makia Henderson was found not guilty at trial.
“The U.S. Attorney’s Office in the Southern District of Florida is committed to combatting identity theft fraud schemes that compromise local and national taxpayer identities,” said U.S. Attorney Benjamin G. Greenberg. “Prosecuting the offenders who unlawfully steal and possess the personal identification information of others in an attempt to steal our tax dollars remains a top priority for the Office and our law enforcement partners.”
“Tax filing season has begun, and today’s announcement should serve as a stern warning to anyone thinking about using stolen identities to file false tax returns with the IRS. IRS Criminal Investigation takes these crimes very seriously, and we will continue to work with the U.S. Attorney’s office to identify, investigate and prosecute individuals who participate in stolen identity refund fraud schemes. As a reminder, taxpayers must stay vigilant in protecting their personal identification information (PII) to help avoid being a victim of these crimes,” stated Kelly R. Jackson, Special Agent in Charge, IRS Criminal Investigation (IRS-CI).
Mr. Greenberg commended the investigative efforts of IRS-CI. This case was prosecuted by Assistant United States Attorney Stephen Carlton.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Two Palm Beach County Residents Sentenced to Prison for Identity Theft SchemeRead the Press Release
Jean Germain, 24, of West Palm Beach, was sentenced to 134 months in prison, to be followed by three years of supervised release, and was ordered to pay restitution in the amount of $1,129,809. Richekad Jean, 26, of Belle Glade, was sentenced to 57 months in prison, to be followed by three years of supervised release, and was ordered to pay restitution in the amount of $250,234.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, and Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), made the announcement.
Defendants Germain and Jean previously pled guilty to one count of conspiracy to commit wire fraud, in violation of Title 18, United States Code, Section 1349; one count of wire fraud, in violation of Title 18, United States Code, Section 1343; one count of aggravated identity theft, in violation of Title 18, United States Code, Section 1028A(a)(1); and one count of theft of government funds, in violation of Title 18, United States Code, Section 641.
According to court documents, the defendants used personally identifiable information (PII) of real persons, including names, dates of birth, and Social Security numbers, to file false federal income tax returns with the IRS. The defendants opened personal bank accounts and purchased prepaid debit cards to receive the fraudulent federal income tax refunds. The defendants registered the pre-paid debit cards not in their own names, but in the names of the persons whose PII was obtained without authorization, to hide and conceal the conspirators' involvement. After the fraudulent IRS refunds were sent to the bank accounts or to the prepaid debit card accounts, the defendants withdrew the funds at automatic teller machines (ATMs) or used bank debit cards and pre-paid debit cards tied to the different accounts containing the stolen monies. Court documents showed the defendants tried to steal more than $2,000,000 from the United States.
Co-defendants Auberson Paul, 24, of West Palm Beach, and Nigel Simmonds, 25, of Port St. Lucie, were each sentenced to time served.
Mr. Greenberg commended the investigative efforts of IRS-CI. This case was prosecuted by Assistant United States Attorney Stephen Carlton.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Treatment Facility Worker Pleads Guilty to Obstruction of a Healthcare Fraud InvestigationRead the Press Release
An employee of a Coral Springs addiction treatment center pled guilty to his role in obstructing an ongoing healthcare fraud investigation in Federal Court today.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida; Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office; Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI); Jimmy Patronis, Florida Chief Financial Officer; Michael J. Waters, Special Agent in Charge, Amtrak Office of Inspector General (Amtrak-OIG); Isabel Colon, Regional Director, United States Department of Labor, Employee Benefits Security Administration (DOL-EBSA); and Dennis Russo, Director of Operations, National Insurance Crime Bureau (NICB), made the announcement.
Jeffrey Adedoyin Williams, 30, of North Lauderdale, pled guilty to one count of obstruction of a criminal health care investigation, in violation of Title 18, United States Code, Section 1518(a), in connection with his employment at Deerfield Medical Center (DMC). Williams is the fifth DMC employee to plead guilty.
According to court documents, Williams worked at DMC where he assisted with the collection of urine samples and provided administrative support at the facility. Although owned by a non-physician, DMC operated as a doctors’ group and provided medical services to various substance abuse treatment facilities located in Palm Beach and Broward Counties, including Reflections Treatment Center and New Life Treatment Center. At the direction of the center’s owner, Richard Botero, other employees would visit substance abuse treatment centers and prescribe controlled substances even though none of them were medically licensed to do so. Licensed and unlicensed medical staff also ordered unnecessary bodily fluid testing, conducted patient visits and conducted patient evaluations.
As part of its federal healthcare fraud investigation, on February 16, 2017, members of the FBI-led Greater Palm Beach Health Care Fraud Task Force, served a grand jury subpoena on DMC seeking DMC records, patient files, and other information. On February 22, 2017, Botero delivered documents and information to the FBI and was questioned, but did not provide complete information or all of the documents sought by the subpoena. The following morning, Williams drove Botero to the Miami International Airport where Botero purchased a plane ticket and fled to Colombia. Another DMC employee, Katherine Gonzalez, also fled from Miami to Colombia later that day.
While in Colombia, Botero and Gonzalez maintained contact with Williams, directing him to remove computers, documents, and other items from DMC’s offices to prevent and delay the FBI from obtaining the items. After learning that Botero and Gonzalez had fled, agents obtained a search warrant for DMC. Upon executing the warrant, agents found that the clinic had been cleared out. When questioned by the agents, Williams admitted that he had removed documents and equipment from DMC. Williams then took agents to the storage space where he had placed most of the items. During questioning, Williams neglected to inform the agents that he also had sold some of Gonzalez’s computer equipment that contained relevant information.
U.S. District Judge Robin L. Rosenberg accepted Williams’ guilty plea and set the matter for sentencing at 10:30 a.m. on April 17, 2018. Williams faces a maximum penalty of five years in prison, three years of supervised release, and a $250,000 fine.
Williams is the fifteenth defendant convicted in the federal investigation into fraud involving substance abuse treatment in the Southern District of Florida.
Mr. Greenberg commended the investigative efforts of the Task Force. Agencies of the task force include the FBI, IRS-CI, the Florida Division of Investigative and Forensic Services, Amtrak OIG, DOL-EBSA, and NICB. The cases are being prosecuted by Assistant United States Attorney A. Marie Villafaña.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
California and Ohio Residents Plead Guilty to Trafficking 15 Kilograms of MethamphetamineRead the Press Release
A California resident and an Ohio resident pled guilty last week to federal charges involving their participation in trafficking over fifteen kilograms of methamphetamine.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, Mark Selby, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), Miami Field Office, and Scott Israel, Sheriff, Broward Sheriff’s Office (BSO), made the announcement.
Defendants Ricardo Zavala, 24, of California, and Jeffery Clevenger, 65, of Ohio, pled guilty to one count of conspiracy to possess with intent to distribute methamphetamine, in violation to Title 21, United States Code, Sections 846 and 841(b)(1)(A). According to court documents, the defendants arranged to travel to the Southern District of Florida to sell more than fifteen kilograms of methamphetamine. On November 20, 2017, the defendants traveled to a hotel located in Broward County. The defendants subsequently transported the narcotics and were taken into custody.
At sentencing, each defendant faces a mandatory minimum sentence of ten years imprisonment and a maximum sentence of up to life imprisonment. The sentencing hearings are set for April 12, 2018, at 10:30 and 11:00 A.M. before Senior U.S. District Judge William Zloch in Fort Lauderdale.
Mr. Greenberg commended the investigative efforts of ICE-HSI and BSO. This case is prosecuted by Assistant U.S. Attorney Randy Katz.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Southern District of Florida U.S. Attorney’s Office Collects $81,953,065.05 in Civil and Criminal Actions for U.S. Taxpayers in Fiscal Year 2017Read the Press Release
U.S. Attorney Benjamin G. Greenberg announced today that the Southern District of Florida collected $81,953,065.05 in criminal and civil actions in Fiscal Year 2017. Of this amount, $57,410,683.40 was collected in criminal actions and $24,542,381.65 was collected in civil actions.
Additionally, the Southern District of Florida worked with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional $84,495,243.94 in cases pursued jointly with these offices. Of this amount, $23,280.87 was collected in criminal actions and $84,471,963.07 was collected in civil actions.
Overall, the Justice Department collected just over $15 billion in civil and criminal actions in the fiscal year ending Sept. 30, 2017.
U.S. Attorney Benjamin G. Greenberg stated, “Through great efforts and diligence our office was once again able to secure restitution for crime victims and recover monies for the U.S. taxpayers. We work hard not only to protect the people of our great nation, but to ensure that criminals do not profit from their crime. Today’s numbers reflect that the U.S. Attorney’s Office collects substantially more money than it spends, and provides the taxpayers with an excellent return on their investment.”
For example, the Southern District of Florida recovered $12,000,000 from a not-for-profit hospital to settle allegations that the hospital violated the False Claims Act by submitting false claims to federal healthcare programs for medically unnecessary cardiac procedures.
In United States v. Goodman, Case No. 07-20871-CR-Seitz, the government recovered $1,474,027.84 from the sale of the criminal defendant’s two luxury condominiums in Costa Rica. In his plea agreement, the defendant agreed to the sale of the Costa Rican properties. The court ordered that the two condominiums be sold and the proceeds applied to Goodman’s restitution judgment.
The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.
The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws. In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration and Department of Education.
Additionally, the U.S. Attorney’s office in the Southern District of Florida, working with partner agencies and divisions, collected $232,327,657.00 in asset forfeiture actions in FY 2017. Forfeited assets deposited into the Department of Justice Assets Forfeiture Fund are used to restore funds to crime victims and for a variety of law enforcement purposes.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Gustavo Falcon Pleads Guilty to Conspiracy to Possess with Intent to Distribute and to Distribute CocaineRead the Press Release
On February 1, 2018, Gustavo Falcon, of Miami, member of the Falcon-Magluta organization, pled guilty in federal court to conspiracy to possess with intent to distribute and to distribute cocaine, in violation of Title 21, United States Code, Section 846, an offense punishable by up to twenty years in prison. Prior to his arrest in April 2017, Falcon was a fugitive for 26 years.
Randy A. Hummel, Executive Assistant United States Attorney, U.S. Attorney’s Office for the Southern District of Florida, Adolphus P. Wright, Special Agent in Charge, Drug Enforcement Administration (DEA), Miami Field Division, and Amos Rojas, Jr., United States Marshal, United States Marshals Service (USMS), made the announcement.
Falcon’s conviction arises out of his participation in the cocaine trafficking organization headed by his older brother, Augusto Guillermo Falcon, a/k/a “Willie,” and Salvador Magluta. From the early 1980s through mid-October 1991, the Falcon-Magluta organization was an extraordinarily prolific cocaine trafficking organization based in the Southern District of Florida and elsewhere. As an illustration of the scope of the organization’s activities, cocaine ledgers seized from a residence controlled by Magluta that covered the period of January 1, 1990, through October 15, 1991, recorded the distribution of 8,921 kilograms of cocaine for a total price of $142,509,800.
In the mid-1980s, the Falcon-Magluta organization established a base in Southern California. From that base, the organization distributed cocaine in the Southern California area and moved large tractor-trailer loads of cocaine from California to various destinations in the United States, including the Southern District of Florida. On almost a daily basis, the organization’s local distribution operations in Southern California received between $50,000 and $200,000 in cash drug proceeds.
Falcon’s wife brother was a Falcon-Magluta organization cocaine trafficker. In 1986, the defendant’s brother-in-law told the defendant that he had a client in California that he needed to supply with cocaine. The defendant gave his brother-in-law the names of two organization members working in the Los Angeles area and told his brother-in-law that one of them would be able to supply any cocaine he needed.
After his arrest in Los Angeles in mid-December 1986, the defendant’s brother-in-law returned to South Florida. In late 1987, Falcon asked his brother-in-law to receive large shipments of cocaine transported from California and introduced him to the organization member responsible for delivering the cocaine to a farm in west Miami-Dade County. The tractor-trailers arrived every one to two months and generally contained 1,000 kilograms of cocaine per load. After the loads were delivered to the farm, the defendant’s brother-in-law then would transport the cocaine to stash houses in the South Florida area.
In late 1989, Falcon contacted a separate organization member and offered him $10,000 per month to stash large quantities of cocaine in his house. After this organization member accepted the defendant’s offer, he received and stored organization cocaine through 1991. A search of that organization member’s house in early January 1992 yielded 3.093 kilograms of cocaine from his attic.
On April 10, 1991, a federal grand jury returned a cocaine trafficking indictment in this case that charged ten Falcon-Magluta organization members. Those charged included Falcon, Willie Falcon, Salvador Magluta, and the defendant’s brother-in-law. After the indictment was unsealed on May 20, 1991, Falcon and others learned of the charges against them. In mid-September 1991, Falcon obtained a false Florida driver’s license in the name of “Luis Andre Reiss.”
In April 2017, the USMS located the defendant in the area of Kissimmee, Florida, where he had been living for a number of years under the “Luis Reiss” alias identity he had established in September 1991. Deputy Marshals captured the defendant on April 12, 2017.
Sentencing for Falcon is scheduled for April 11, 2018, at 10:00 A.M., before United States District Judge Federico A. Moreno.
Mr. Hummel commended the investigative efforts to the DEA and USMS. This case is being prosecuted by Assistant U.S. Attorney Christopher Clark.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Former Newspaper Publisher, Mortgage Broker, Mortgage Lender and Real Estate Agent Sentenced in $20 Million Mortgage Fraud SchemeRead the Press Release
A former Miami newspaper publisher, mortgage broker, mortgage lender and real estate agent was sentenced in federal court today to serve 180 months imprisonment for leading a $20 million mortgage fraud scheme.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, and Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, made the announcement.
Marco Laureti, 46, of Sunny Isles Beach, was sentenced to 180 months imprisonment, to be followed by five years of supervised release, and ordered to pay $8,316,135, in restitution. In November 2017, after a three-week trial, Laureti was convicted of one count of conspiracy to commit wire fraud, in violation of Title 18, United States Code, Section 1349 and seven counts of wire fraud affecting a financial institution, in violation of Title 18, United States Code, Section 1343 (Case No. 16-60340-CR-Bloom(s)(Cohn)).
“The sentence imposed is a success in our continuing efforts to fight mortgage fraud that jeopardizes our nation’s financial institutions,” said U.S. Attorney Benjamin G. Greenberg. “Laureti was a prominent businessman who used his reputation to perpetrate the $20,000,000 mortgage fraud scheme, which thanks to the efforts of law enforcement, was successfully unraveled. We will continue to investigate and prosecute individuals who engage in deceptive and fraudulent behavior that is fueled by greed.”
“Criminals are always looking for ways to exploit vulnerabilities and devise methods to defraud,” said Robert F. Lasky, Special Agent in Charge, FBI Miami. “Marco Laureti and his co-conspirators implemented a mortgage fraud scheme for their own personal enrichment, but instead got an investigation, a trial and a conviction. Would-be mortgage fraudsters beware: The FBI remains committed to rooting out this type of fraud.”
According to evidence presented at trial, Laureti and co-conspirators were involved in a $20 million mortgage fraud scheme. Laureti was a former newspaper publisher and owner of Laureti Publishing Company and multiple companies, including Northview Equities LLC, Northview Real Estate LLC, Northview Capital LLC, Laureti Holdings Company, Laureti Media Group, Inc., ReTrade, Inc., and M4 Management LLC, in addition to being a licensed Florida real estate agent and formerly licensed Florida mortgage broker.
At trial, the government presented evidence that the defendant and his co-conspirators engaged in a fraud scheme involving a condominium complex located at 45 Hendricks Isle in Fort Lauderdale. The defendant and other co-conspirators made false and fraudulent statements to a financial institution on mortgage loan applications, including grossly inflating income and bank account balances. These defendants also made fraudulent representations on the closing statements for these multi-million dollar condominiums. Once these loans were approved, a co-conspirator, at Laureti’s direction, diverted the loan proceeds to fund the cash the borrower was expected to bring to the property’s closing, as well as diverting additional monies from the loan proceeds to various companies owned by Laureti and another co-conspirator. The evidence showed Laureti paid a co-conspirator $10,000 for each fraudulent transaction. Furthermore, Laureti and a co-conspirator utilized the same scheme on the mortgage loan applications and closing statements to purchase their own multi-million dollar residential properties in Miami Beach, including Laureti’s $6.9 million home and a co-conspirator’s $6.5 million dollar condominium. The defendants’ scheme defrauded the financial institution of approximately $20 million in disbursed mortgage loans.
Mr. Greenberg commended the investigative efforts of the FBI. This case was prosecuted by Assistant U.S. Attorneys Randy Katz and Karen O. Stewart.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Two Riviera Beach Men Sentenced for Stealing Sea Turtle EggsRead the Press Release
Two Riviera Beach men were sentenced to prison for stealing sea turtle eggs from a St. Lucie County beach.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, Andrew Aloise, Resident Agent in Charge Florida, U.S. Fish and Wildlife Service (USFWS), and Major Olin Rondeau, Florida Fish and Wildlife Conservation Commission (FWC), Southern Region, made the announcement.
Carl Lawrence Cobb, 60, of Riviera Beach, was convicted of two counts of transporting sea turtle eggs for the purpose of sale, in violation of the Lacey Act, Title 16, United States Code, Sections 3372(a)(1) and 3373(d)(1)(B). U.S. District Judge Kenneth Marra sentenced Cobb to 7 months in prison, followed by 2 years of supervised release. He was also ordered to pay $227 in restitution to the State of Florida.
Raymond Saunders, 50, also of Riviera Beach, was convicted of one count of transporting sea turtle eggs for the purpose of sale, in violation of the Lacey Act, Title 16, United States Code, Sections 3372(a)(1) and 3373(d)(1)(B). Judge Marra sentenced him to 7 months in prison, followed by 2 years of supervised release, and ordered him to pay restitution in the amount of $227 to the State of Florida.
According to the court record, on May 5, 2017, a concerned citizen reported to the FWC that a man was disturbing sea turtle nests on North Hutchinson Island. A law enforcement investigation revealed that Cobb had removed over 200 eggs from two sea turtle nests. On May 24, 2017, law enforcement officials observed Cobb and Saunders remove approximately 469 sea turtle eggs from nests on North Hutchinson Island. Cobb and Saunders were arrested as they were transporting the eggs to Palm Beach County. The recovered eggs were relocated by marine biologists in the hope that some of them will yield hatchlings.
Mr. Greenberg commended the investigative efforts of USFWS and the FWC. This case was prosecuted by Special Assistant United States Attorney Ryan Butler.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Florida-Based School Chain to Pay United States Government $600,000 for Submitting False Claims for Federal Student Financial AidRead the Press Release
Florida Technical College, Inc. (“FTC”) will pay the United States $600,000 to resolve False Claims Act allegations that FTC’s Cutler Bay Campus (“FTC-Cutler Bay”) falsely certified compliance with federal student aid programs’ eligibility requirements and submitted claims for 27 ineligible students.
Benjamin G. Green, United States Attorney for the Southern District of Florida, made the announcement.
Title IV of the Higher Education Act of 1965 (“HEA”), as amended, 20 U.S.C. §§ 1070 et seq. (“Title IV, HEA Programs”), authorizes federal student aid programs. The Title IV, HEA Programs, administered by the United States Department of Education, provide students with financial aid in the form of, among other things, Federal Pell Grants and Federal Direct Loans.
“Federal financial aid is meant to help qualified students obtain a quality education from an eligible institution, and we are committed to ensure colleges comply with the rules to make certain that federal financial aid is provided to those individuals it is meant to assist,” said U.S. Attorney Benjamin G. Greenberg.
The United States alleged that certain FTC-Cutler Bay employees engaged in fraudulent practices to induce students to enroll in the school. As a result of those admissions personnel, FTC submitted to the U.S. Department of Education false information regarding the eligibility of 27 FTC-Cutler Bay students to receive Title IV, HEA Program funds. Specifically, FTC-Cutler Bay employees provided false documentation that the students had a high school diploma or its recognized equivalent from a qualified secondary school, when the those students did not have such credential.
In providing such false documentation, FTC-Cutler Bay’s enrollment numbers were falsely increased, and consequently, the amount of federal dollars the school received also increased at the expense of taxpayers and students, who incurred long-term debt. FTC cooperated in the investigation and FTC no longer employs the admissions personnel or their managers involved.
The lawsuit was filed on March 8, 2016, by Laurie Astacio, a former administrative assistant in the FTC-Cutler Bay admissions office. She filed the complaint under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government and receive a share of any recovery. The Act also authorizes the government to intervene in and assume primary responsibility for litigating the lawsuit.
“The Office of Inspector General has a unique and special law enforcement mission – to protect public education funds for eligible students. Today’s settlement is an example of our commitment to this mission,” said Neil Sanchez, Special Agent in Charge of the U.S. Department of Education Office of Inspector General’s Southern Regional Office. “The OIG will continue to pursue allegations of violations of the False Claims Act in carrying out our important public service.”
This matter was investigated and the settlement negotiated by Assistant U.S. Attorney James A. Weinkle. The case is captioned U.S. ex rel. Laurie Astacio v. Florida Technical College, Inc., Case No.: 16-20842-CIV-Seitz (S.D. Fla.). The claims settled by this agreement are allegations only, and there has been no determination of liability.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Man Sentenced After Intimidating Spirit Airlines Flight AttendantsRead the Press Release
Michael Anthony Minko, 36, of White Springs, Florida, was sentenced to two concurrent sentences of two months imprisonment, after pleading guilty to two counts of intimidating a flight attendant of an aircraft in flight in the United States.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, and Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, made the announcement.
On July 18, 2017, Minko intimidated two Spirit Airlines flight attendants on a flight from Newark, New Jersey to Fort Lauderdale, and interfered with the performance of their duties. Specifically, after the flight departed, the defendant drank an excessive amount of whiskey from a bottle in his possession and consumed prescription alprazolam (generic form of Xanax). During the course of the flight, Minko cursed, used abusive language, made verbal threats and exhibited threatening actions. As a result, a flight attendant and three passengers used plastic flex cuffs to secure Minko’s hands behind his back.
U.S. District Judge Beth Bloom ordered Minko to report on Friday, February 23, 2018, to commence his term of imprisonment at that time, thereby allowing the defendant to continue his treatment at an alcohol and drug treatment facility.
Mr. Greenberg commended the investigative efforts of the FBI in connection with this matter. This case was prosecuted by Assistant U.S. Attorney William T. Shockley.
Michael Anthony Minko, 36, of White Springs, Florida, was sentenced to two concurrent sentences of two months imprisonment, after pleading guilty to two counts of intimidating a flight attendant of an aircraft in flight in the United States.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, and Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, made the announcement.
On July 18, 2017, Minko intimidated two Spirit Airlines flight attendants on a flight from Newark, New Jersey to Fort Lauderdale, and interfered with the performance of their duties. Specifically, after the flight departed, the defendant drank an excessive amount of whiskey from a bottle in his possession and consumed prescription alprazolam (generic form of Xanax). During the course of the flight, Minko cursed, used abusive language, made verbal threats and exhibited threatening actions. As a result, a flight attendant and three passengers used plastic flex cuffs to secure Minko’s hands behind his back.
U.S. District Judge Beth Bloom ordered Minko to report on Friday, February 23, 2018, to commence his term of imprisonment at that time, thereby allowing the defendant to continue his treatment at an alcohol and drug treatment facility.
Mr. Greenberg commended the investigative efforts of the FBI in connection with this matter. This case was prosecuted by Assistant U.S. Attorney William T. Shockley.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
City of Miami Police Officer Charged in Ponzi SchemeRead the Press Release
City of Miami police officer Dermis Hernandez, 41, of Homestead, was arrested by the FBI for participation in a scheme where Hernandez falsely represented to victim investors that he was able to offer a low risk investment with guaranteed returns through high-interest loans his company made to Costa Rican property owners.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Jorge Colina, Chief, City of Miami Police Department (MPD), made the announcement.
On January 29, 2018, Hernandez was arrested at the Fort Lauderdale airport before boarding a flight to Costa Rica. Hernandez was charged by complaint with a conspiracy to commit wire fraud, in violation of Title 18, United States Code, Section 1349. It is alleged that, Hernandez told investors that their investment funds provided loans for the property owners in Costa Rica whose real property would be used as collateral for the loan and forfeited if the loan was not paid. In truth, Hernandez and his co-conspirators used the majority of investor funds for personal enrichment and to pay the returns of other investors.
Mr. Greenberg commended the investigative efforts of the FBI and the MPD. This case is being prosecuted by Assistant U.S. Attorney Matthew Langley.
A criminal complaint is merely an allegation and every defendant is presumed innocent until proven guilty.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Two Arrested in Major Antiquities TheftRead the Press Release
Richard Steven Johnson, 41, of Rio Linda, California, and Jarred Alexander Goldman, 32, of Palm Beach Gardens, were arrested today, after being charged with conspiring to steal and stealing a 17th century gold bar on or about August 18, 2010, from the Mel Fisher Maritime Heritage Museum in Key West.
Benjamin G. Greenberg, United States Attorney, Southern District of Florida, Robert F. Lasky, Federal Bureau of Investigation (FBI), Miami Field Office, and Donald J. Lee, Jr., Chief, Key West Police Department, made the announcement.
Johnson will make his initial appearance in Sacramento, California, later today. Goldman will make his initial appearance before U.S. Magistrate Judge Lurana S. Snow, in Key West, on January 30, 2018, at 9:30 a.m.
The defendants are accused of driving to Key West from West Palm Beach on or about August 18, 2010, and entering the Mel Fisher Maritime Heritage Museum. It is alleged that Goldman then stood guard as a lookout to enable Johnson to steal the gold bar. Johnson then allegedly removed the gold bar from its display case at the museum and both defendants then drove back to West Palm Beach. The gold bar has not been recovered.
Mr. Greenberg commended the investigative efforts of the FBI and the Key West Police Department. The case is being prosecuted by Assistant U.S. Attorney Daniel J. Marcet.
An indictment is only an accusation, and a defendant is presumed innocent unless and until proven guilty.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Three Defendants Convicted in Securities Fraud InvestigationRead the Press Release
A New York stock promoter, a Colorado registered stock transfer agent, and a California securities attorney were recently convicted of securities fraud offenses. These cases pertain to a conspiracy to sell shares of fraudulently registered companies that could then be used for pump and dump and other stock manipulation schemes. To date, ten defendants have been convicted in connection with the investigation.
Randy A. Hummel, Executive Assistant United States Attorney, U.S. Attorney’s Office for the Southern District of Florida, Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Andrew W. Vale, Assistant Director in Charge, FBI, Washington Field Office, made the announcement.
John Ahearn, 56, of Erie, Colorado and formerly of Miller Place, New York, and Andrew H. Wilson, 69, of Nevada City, California, plead guilty on January 25, 2018, of conspiracy to unlawfully sell unregistered securities, in violation of 18 U.S.C. § 371, in Case No. 17-CR-20883-KMW. Each defendant faces a maximum statutory sentence of five years in prison and a fine up to $250,000 or double the proceeds of the offense. Sentencing is scheduled for Ahearn and Wilson on June 8, 2018, before U.S. District Judge Kathleen M. Williams.
Yelena Furman, 36, of New York, New York, plead guilty on January 23, 2018, of conspiracy to commit securities fraud, in violation of 18 U.S.C. § 1349 in Case No. 17-CR-2-713-CMA. Furman faces a maximum statutory sentence of 25 years in prison and a fine of up to $250,000 or double to proceeds of the offense. Sentencing is scheduled for Furman on April 25, 2018, before U.S. District Judge Cecilia M. Altonaga.
Seven other defendants were previously convicted in connection with this investigation: David Lubin, Case No. 17-20508-CR-MGC; Sheldon Rose and Ian Kass, Case No. 16-20706-CR-JEM; Steven Sanders and Alvin Mirman, Case No. 16-20572-CR-CMA; and, Daniel McKelvey and Jeffrey Lamson, Case No. 16-20546-CR-RNS.
According to court documents, from early 2007 through at least 2014, Sanders, McKelvey, Lubin and other conspirators would fraudulently create public companies, known as issuers, by filing documents with the SEC that falsely described the companies and their share ownership. These documents would indicate that the companies were controlled by a nominee, or straw chief executive officer (CEO). The straw CEO would be listed as the owner of the control block, or restricted shares, but in reality the companies were controlled by the principals. The principals would also create documents with the names of various shareholders for each company, to make it appear that these shares were owned by persons unaffiliated with the company. These shares would later be classified as unrestricted or “free trading.” Thereafter, the principals would sell the companies to criminal actors who would secretly obtain the control shares and the purported “free trading” shares, without disclosure to the SEC or the investing public. This would allow the buyers to engage in stock manipulation schemes using the purported “free trading” shares. According to documents filed in court, Furman, Ahearn and Wilson engaged in acts that furthered the conspiracy so that they could personally profit.
According to court filings, Lubin created Entertainment Art, Inc., (“EERT”) using false and fraudulent documents, and then sold it in approximately 2009 to Myron Gushlak (who also is charged in Case No. 17-CR-2-713-CMA). Gushlak was convicted in a separate securities fraud case in the Eastern District of New York and was sentenced to prison in November 2010. Shortly before he went to prison, Gusklak asked Sanders and others to sell the company and to provide the proceeds to himself and his then girlfriend, Furman.
According to court filings, Sanders, Furman and Lubin and other conspirators acted together to cause securities filings in the name of EERT, that falsely described the management of the company and its share structure.
According to court filings, Ahearn was the owner of Manhattan Transfer Registrar Co. (“Manhattan Transfer”), a stock transfer agent with offices in New York and Colorado. Ahearn became aware that the EERT shares were listed in the names of straw shareholders but were in fact controlled by undisclosed principals. In approximately October 2012, Ahearn assisted with the unlawful transfer of EERT shares to certain shell buyers, who changed the name to Biozoom, Inc. (“BIZM”) and, in May 2013, used the BIZM shares for a pump and dump stock swindle.
Wilson, according to court filings, was an attorney licensed to practice law in California who authored false and fraudulent legal opinion letters for EERT. These letters falsely stated that shares of the companies were owned by persons who were not “affiliates,” and were used by persons who acquired the shares to deposit them with brokers and unlawfully them to the investing public. In reality, Wilson took his direction from Sanders and another conspirator, McKelvey, whom Wilson came to learn secretely controlled the companies.
Furman, according to court filings, participated in the filing of certain fraudulent documents with the SEC for companies controlled by Gushlak. Furman also assisted Gushlak with taking certain elaborate steps to conceal funds transfers to herself, including in relation to EERT. Documents filed in court allege that, because Gushlak’s assets were frozen by the New York federal court, and he had been ordered to pay a $25 million fine and restitution of approximately $17.4 million, Gushlak, Furman, Sanders and others engaged in elaborate steps to hide and conceal the proceeds of the EERT stock sales. This included wiring funds to an intermediary in Switzerland and to an account controlled by Furman in New York that was used to pay Gushlak’s bills while he was in prison.
Mr. Hummel commended the investigative efforts and coordination of the FBI’s Miami Field Office and Washington Field Office. Mr. Hummel also thanked the SEC’s Miami Regional Office and Washington Home Office for their assistance. The SEC previously filed parallel civil enforcement actions related to this matter. These cases are being prosecuted by Assistant U.S. Attorney Jerrob Duffy.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Coral Gables Resident Charged with Wire Fraud in Connection with Hurricane Relief Efforts for Puerto RicoRead the Press Release
Emilio I. Vazquez, of Coral Gables, was arrested on a criminal complaint charging him with wire fraud in connection with hurricane relief efforts to Puerto Rico.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, and Brian Swain, Special Agent in Charge, United States Secret Service (USSS), made the announcement.
According to the allegations contained in the criminal complaint, in or around September 2017, Vazquez contacted a group of volunteers working to provide hurricane relief aid to Puerto Rico. Vazquez claimed that he was part of the Serralles family, who are the owners of Destileria Serralles, which distills, manufactures, bottles and distributes Don Q rum in Puerto Rico. Vazquez claimed to have significant resources and the ability to rent warehouses, and charter planes and trucks to transport relief supplies.
According to the complaint, in or around September 2017, Vazquez, using the name Emilio Serralles, contacted Commercial Property Group in Doral, Florida, regarding the rental of warehouse space. The warehouse space was purportedly to be used to store relief supplies for Puerto Rico. On or about September 29, 2017, Vazquez provided Commercial Property Group with a counterfeit and fraudulent UBS bank cashier’s check in the amount of $122,050.50, to pay for the warehouse space. It is alleged that the next day, Vazquez signed a lease under the name Emilio Serralles, renting five warehouse spaces from Commercial Property Group.
According to the complaint, in or around October 2017, Vazquez contacted Miami Air International, a local charter airline. Vazquez again identified himself as Emilio Serralles and claimed to own a company called Puerto Rico Relief Committee. Subsequently, Vazquez chartered multiple flights from Miami to Puerto Rico to purportedly deliver relief supplies. As payment for these flights, Vazquez provided a counterfeit and fraudulent American Express Centurion Bank cashier’s check in the amount of $564,036.05 to Miami Air International, which was rejected as fraudulent by U.S. Trust, Bank of America Private wealth management.
On January 23, 2017, a New York City Police Department officer arrested Vazquez in Brooklyn, New York. He is scheduled to make his initial appearance on Thursday, January 25, 2018, at 2 p.m., before U.S. Magistrate Judge Viktor V. Pohorelsky, of the Eastern District of New York, in Brooklyn, New York.
Mr. Greenberg commended the investigative efforts of the USSS. This case is being prosecuted by Assistant United States Attorney Joshua S. Rothstein.
A criminal complaint is merely an allegation and the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida atwww.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Broward Resident Found Guilty of Stealing Deceased Grandparents’ Social Security FundsRead the Press Release
After a three-day trial, a federal jury today convicted a Broward County resident of stealing social security benefits years after her grandparents died.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, and Margaret Moore-Jackson, Special Agent in Charge, Social Security Administration, Office of Inspector General (SSA-OIG), made the announcement.
Myriam Etienne, 49, of Pompano Beach, was convicted of ninety counts of theft of government funds, in violation of Title 18, United States Code, Section 641. Senior U.S. District Judge James I. Cohn presided over the trial. The defendant’s sentencing hearing is scheduled for April 5, 2018 at 9:30 a.m. At sentencing, the defendant faces up to ten years imprisonment on each count, a $250,000 fine as to each count and restitution.
According to evidence presented at trial, Etienne received Social Security Supplemental Security Income (“SSI”) benefits for her grandparents since 2004. The Social Security Administration administers numerous programs to provide for the material needs of individuals and their families, including SSI. SSI is a federal program that provides assistance to lower income individuals to meet basic food, shelter, medical and clothing needs. Monthly SSI benefits are paid to eligible individuals.
The evidence presented at trial revealed that these benefits were paid to the defendant’s grandmother and grandfather and the defendant controlled their funds as a representative payee. The SSI funds were direct deposited into a joint bank account the defendant shared with her deceased grandparents. The trial evidence revealed that the defendant’s grandfather died in Haiti in 2006 and the defendant’s grandmother died in Haiti in 2009. The defendant, however, kept receiving their SSI benefits and did not report the deaths to the Social Security Administration.
The evidence showed that the defendant signed representative payee accounting records, years after their deaths, verifying that the SSI money was being utilized for her grandparents food, shelter, clothing and medical treatment. After her grandmother’s and grandfather’s deaths, the defendant received approximately over $130,000 in SSI payments. The evidence at trial further revealed that the defendant made several mortgage payments and additional payments on her BMW X6 vehicle utilizing the SSI funds direct deposited into the joint account.
Mr. Greenberg commended the investigative efforts of the SSA-OIG, the U.S. Department of State and the FBI’s Legal Attaché in Port-au-Prince, Haiti. This case is being prosecuted by Assistant U.S. Attorney Randy Katz.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Two Indian Citizens and India-based Corporation Plead Guilty to Conspiring to Smuggle Counterfeit CigarettesRead the Press Release
Abhishek Shukla and Harish Shabhai Panchal, both citizens of India, entered guilty pleas, along with the India-based company, Jubilee Tobacco Industries Corp., to conspiring to smuggle counterfeit cigarettes into the United States.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, Peter H. Kuehl, Acting Special Agent in Charge, U.S. Food & Drug Administration, Office of Criminal Investigations (FDA-OCI), Miami Field Office, Mark Selby, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), Miami Field Office, and Scott Israel, Sheriff, Broward County Sheriff’s Office (BSO), made the announcement.
All three defendants pled guilty to conspiring with each other, with the intent to defraud and mislead, sell and cause the sale and dispensing of a counterfeit tobacco product (cigarettes), the containers and labeling of which bore the trade name and marks of the American brand of Newport cigarettes, a tobacco product listed with the FDA pursuant to Title 21, United States Code, Section 387(e)(i)(1), (approximately 68,600 cartons of cigarettes), while knowingly using a counterfeit mark on and in connection with such cigarettes, the use of which marks was likely to cause confusion, to cause mistake, and to deceive. The counterfeit marks were substantially indistinguishable from the marks of the United States domestic manufacturer of Newport brand cigarettes, which marks were then in use by and registered to that manufacturer on the principal register of the United States Patent and Trademark Office, all in violation of Title 18, United States Code, Section 371.
According to court records, including a Joint Factual Statement submitted by the parties, beginning in March 2015 and continuing through August 16, 2017, the defendants initiated contact with an individual cooperating with FDA-OCI, offering counterfeit cigarettes for sale. Through internet negotiations, an agreement was reached for a 20-foot container filled with counterfeit Newport brand cigarettes to be shipped from India to Miami. Payment for the shipment was made in installments through international wire transfers to bank accounts in India and in Dubai, United Arab Emirates. On November 1, 2016, the container arrived and was seized at the Port of Miami with the assistance of U. S. Customs and Border Protection Officers. If distributed in the State of Florida, the un-taxed importation would have an approximate value of $1.2 million. Analysis conducted by FDA’s Forensic Chemistry Center determined that the cartons, packs, and cigarettes were all counterfeit.
Within two weeks of the arrival, the coconspirators sought out FDA-OCI undercover agents offering another shipment, twice as large. By April 2017, deposits totaling $55,000 had been made for more counterfeit Newport cigarettes. On June 9, 2017, the container arrived at the Port of Miami and was again seized with the assistance of Customs and Border Protection Officers, and turned over to FDA-OCI Special Agents. If distributed in the State of Florida, the un-taxed importation would have an approximate value of $3.2 million.
According to acts described in the conspiracy charge, Shukla and Panchal traveled to Miami in August 2017 to meet with the undercover agents to promote further business dealings. During the recorded meeting, they advised the agents that they had been partners for twelve years and personally oversaw the production of all the products being offered. They also assured the agents that they could counterfeit any American-made menthol cigarette with no problem, as well as other trademarked brands, and that they could produce tobacco blends, which would closely match the legitimate product.
Shukla and Panchal each face potential prison sentences of up to five years imprisonment. Additionally, they face possible fines of up to $250,000, followed by supervised release of up to five years. Jubilee faces a fine of up to $500,000. In its Plea Agreement, Jubilee agreed to forfeit $300,000, to the United States. Sentencing in this case is scheduled for February 12, 2018, at 2:00 p.m. before U.S. District Judge Kathleen M. Williams.
Mr. Greenberg commended the investigative efforts of FDA OCI, ICE-HSI and BSO, for their assistance with this long-term investigation. Mr. Greenberg also thanked U.S. Customs and Border Protection for their support. This matter is being prosecuted by Assistant U.S. Attorney Thomas Watts-FitzGerald.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Miami Resident Sentenced in Identity Theft SchemeRead the Press Release
Defendant had personal identification information of over 1,000 individuals, most of whom were Miami-Dade College students
A Miami resident was sentenced to 38 months in prison, to be followed by three years of supervised release, and was ordered to pay $42,338.49 in restitution for his participation in an identity theft scheme.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, Peter J. Forcelli, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Miami Field Division, Bryan Pegues, Chief, City of Aventura Police Department, and Rodolfo Llanes, Chief, City of Miami Police Department, made the announcement.
Thomas Jerry III, 32, of Miami, previously pled guilty to one count of possession of fifteen or more unauthorized access devices, in violation of Title 18, United States Code, Section 1029(a)(3), and one count of aggravated identity theft, in violation of Title 18, United States Code, Section 1028A(a)(1).
In May 2014, law enforcement conducted a traffic stop of a vehicle that was being driven by Jerry. During the vehicle search, law enforcement found two cellular telephones. The call log on one of Jerry’s telephones reflected that the telephone had been used to call the Capital One bank customer service line several times. The defendant’s other telephone contained images of the personal identification information (PII) of an identity theft victim and images of the victim’s credit report. A Capital One credit card in the name of the victim was also found. It was determined that the telephones were used to access and take over 79 Capital One accounts, and the caller had requested that the new cards be mailed to two addresses in Miami, Florida.
On July 24, 2014, a search warrant was executed at the Miami addresses. In the defendant’s bedroom, law enforcement found the PII (including names, dates of birth, and social security numbers) of over 1,000 individuals, most of whom were Miami-Dade College students; multiple H&R block debit cards, one of which had been funded by a fraudulent federal income tax return; an American Express card in the name of a student at Miami Dade College; Capital One credit cards in the names of identity theft and account take over victims; and a letter from Capital One containing the personal identification number (PlN) of an identity theft victim.
Mr. Greenberg commended the investigative efforts of IRS-CI, FBI, ATF, the City of Aventura Police Department, and the City of Miami Police Department. This case was prosecuted by Assistant U.S. Attorneys Daya Nathan and Gera Peoples.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
A South Florida Resident Sentenced to More Than 5 Years in Prison for Stolen Identity Fraud Schemes and Filing False Tax ReturnsRead the Press Release
A South Florida resident was sentenced to 70 months in prison, to be followed by three years of supervised release, and was ordered to pay restitution in the amount of $507,495.28 for his participation in stolen identity tax fraud, a social security fraud scheme, and filing false tax returns.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), and Margaret Moore-Jackson, Special Agent in Charge, Social Security Administration, Office of Inspector General (SSA-OIG), made the announcement.
Stanley Joseph Laratte previously pled guilty to one count of receiving stolen government funds, one count of aggravated identity theft, and one count of filing a false income tax return, in violation of Title 18, United States Code, Sections 641 and 1028A(a)(1) and Title 26, United States Code, Section 7206(1).
According to court documents, between June 2011 and August 2015, Laratte filed approximately 600 fraudulent income tax returns with the IRS claiming approximately $1.25 million in refunds that were to be deposited into various bank accounts owned and/or controlled by the defendant. Many of the returns were filed in the names of deceased individuals or in the names of individuals who had their identities otherwise compromised. Ultimately, the IRS denied most of the claimed refunds and only deposited approximately $200,000 into Laratte’s accounts.
Between September 2015 and July 2017, the defendant accessed various Social Security Administration (SSA) accounts for at least two dozen SSA beneficiaries by using their personal identifiers without their knowledge or authorization. Laratte diverted approximately $302,000 of the beneficiaries' monthly retirement benefits onto Green Dot debit cards possessed and used by the defendant.
In June 2015 and August 2016, Laratte created and filed fraudulent personal income tax returns in his own name for the tax years 2014 and 20l5. He created and submitted phony Form W -2s to the IRS in support of these returns. When offset by various credits and deductions, these fraudulent returns generated approximately $16,000 in refunds, which were deposited into the defendant's bank account.
Mr. Greenberg commended the investigative efforts of IRS-CI and SSA-OIG. This case was prosecuted by Assistant U.S. Attorney Jon Milton Juenger.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Miami-Dade County Resident Sentenced to 64 Months for Stolen Identity Refund FraudRead the Press Release
A Miami-Dade County resident was sentenced to 64 months in prison for his participation in a stolen identity tax refund scheme. Nick Rickey Choute’s sentence will be followed by three years of supervised release. Additionally, Choute was ordered to pay $191,280 in restitution, a $500 special assessment, and a forfeiture money judgment of $452,006.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, and Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), made the announcement.
Nick Rickey Choute, 24, of Miami, previously pled guilty to charges relating to his participation in a stolen identity tax refund scheme that resulted in the submission of more than $400,000, in fraudulent refund claims to the IRS for tax years 2014 and 2015. Specifically, Choute pled guilty, without a plea agreement, to all charges in the indictment: one count of fraudulent use of access devices, in violation of 18 U.S.C. § 1029(a)(2); one count of possession of fifteen or more unauthorized access devices, in violation of in violation of 18 U.S.C. § 1029(a)(3); and three counts of aggravated identity theft, in violation of 18 U.S.C. § 1028A(a)(1). Choute pled guilty after a jury was selected, but before jury addresses commenced.
According to documents filed with the court, from approximately January 2015 through March 2016, in Miami-Dade County, Choute used stolen identities, including the names, dates of birth, and social security numbers of hundreds of South Florida residents born in the 1990s, to file more than 150 tax returns with the IRS. These fraudulent returns sought more than $450,000, in refunds. Choute directed the refunds to be deposited into bank accounts and prepaid debit card accounts that he opened in the names of other identity theft victims. He then withdrew the fraudulently obtained funds. In addition, when the IRS conducted a search of Choute’s home in March 2016, more than 2,500 victims’ identities were found in notebooks recovered from Choute’s bedroom, and personal identifying information of additional victims was also discovered on Choute’s iPad.
Mr. Greenberg commended the investigative efforts of IRS-CI. This case was prosecuted by Assistant U.S. Attorneys Lisa H. Miller and Quinshawna Landon.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Florida Man Sentenced to Prison for Making Telephonic Threat to Shoot Congregants at the Islamic Center of Greater MiamiRead the Press Release
U.S. District Judge Marcia G. Cooke sentenced a Miami-area man to 12 months and one day in prison and three years’ supervised release for threatening to shoot members of a mosque in Miami Gardens, Florida, announced U.S. Attorney Benjamin G. Greenberg for the Southern District of Florida and Acting Assistant Attorney General John Gore of the Civil Rights Division.
Gerald Wallace, 35, pleaded guilty in October 2017 in the Southern District of Florida to one count of obstructing the free exercise of religious beliefs for making the threatening call. During the plea hearing, Wallace admitted that on the evening of Feb. 19, 2017, Wallace left a voicemail message for the Islamic Center of Greater Miami, located in Miami Gardens, Florida. The defendant admitted leaving a hate-filled and profanity-laden message against Islam, the prophet Mohammed, and the Koran, during which he threatened to go to the mosque, and stated, “I’m gonna shoot all ya’ll.” He further admitted that by leaving this threatening message, he obstructed congregants who worship at the Islamic Center from freely exercising their religious beliefs.
“Hate crimes violate our country’s most fundamental principles,” said U.S. Attorney Benjamin G. Greenberg. “Wallace was sentenced for depriving the Islamic Center’s congregants of the right to freely exercise their religion. This office will continue to aggressively prosecute hate crimes in order to protect those in our community who would otherwise fall victim to discriminatory violence.”
“Our Constitution and laws guarantee all people – regardless of where they worship – the right to live free from violence and discrimination,” said Acting Assistant Attorney General John Gore. “The Justice Department will continue to vigorously prosecute those who commit violent acts of hate by threat or action.”
This case was investigated by the FBI’s Miami Area Corruption Task Force and the Miami Gardens Police Department. The case was prosecuted by Assistant U.S. Attorney Harry C. Wallace, Jr. of the Southern District of Florida and Trial Attorney Samantha Trepel of the Civil Rights Division.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Michael “Mickey” Munday Convicted of Conspiracy to Commit Mail Fraud and Mail FraudRead the Press Release
A Miami jury convicted North Miami resident Michael “Mickey” Munday of conspiracy to commit mail fraud and mail fraud after a four-day trial.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, Brian Swain, Special Agent in Charge, United States Secret Service (USSS), and Rick Maglione, Chief, Fort Lauderdale Police Department, made the announcement.
Munday, 72, was convicted of one count of conspiracy to commit mail fraud, in violation of Title 18, United States Code, Section 1349, and five counts of mail fraud, in violation of Title 18, United States Code, Section 1341. He faces a statutory maximum sentence of 20 years imprisonment for each count. Sentencing is scheduled for March 29, 2018, at 8:30 a.m. before U.S. District Court Judge Robert N. Scola, Jr. Nine other co-defendants were indicted and pled guilty in connection with the same scheme.
The evidence presented at trial established that Munday obtained vehicles from throughout the country using various fraudulent methods. These methods included, among other things, convincing people who were behind on their car payments to turn over their vehicles to him in exchange for cash, illegally repossessing vehicles, and covertly transporting stolen cars from other states to Florida. In order to evade detection by law enforcement, Munday and his co-conspirators used several towing and repossession companies as fronts for their illegal activity.
After Munday and his co-conspirators obtained the vehicles, the automobiles were then hidden from owners, banks and lienholders at a number of locations, including at Munday’s North Miami residence. While the vehicles were hidden, another co-conspirator prepared and sent, via U.S. mail, false and fraudulent lien notices claiming thousands of dollars in nonexistent tow services to the vehicle owners and true lienholders. Sham auctions were then held at a strip mall, some of which were facilitated by Munday. Of the more than 150 cars involved in the scheme, only one car appeared at an “auction,” and there were never any customers. After the sham auction was held, the conspirators then cleaned the respective car titles by falsely and fraudulently removing the legitimate owners and lienholders from the title. The cars were then sold to a co-conspirator in the automotive wholesale business at prices below market value and resold for a profit to local dealerships. Overall, banks suffered more than $1.7 million in loss as a result of the scheme.
During the trial, videos and social media postings were introduced showing Munday bragging about his past experience as a drug smuggler, explaining the effectiveness of tow companies as fronts for smuggling, proclaiming himself the “UPS of the smuggling industry,” and advertising himself as a master of evading law enforcement.
Mr. Greenberg commended the investigative efforts of the USSS and the Fort Lauderdale Police Department. The case was prosecuted by Assistant United States Attorneys Joshua S. Rothstein and Anne P. McNamara.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Mexican National Sentenced to 20 Years in Prison for Drug Trafficking and Firearms ViolationsRead the Press Release
A Mexican national was sentenced today by United States District Judge Beth Bloom to 20 years in prison, to be followed by 10 years of supervised release for drug trafficking and firearms violations.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, Adolphus P. Wright, Special Agent in Charge, Drug Enforcement Administration (DEA), Miami Field Division, Michael W. Meade, Acting Field Officer Director, U.S. Immigration and Customs Enforcement, Enforcement and Removal Operations (ICE-ERO), Miami Field Office, Matthew A. Zetts, Chief Patrol Agent, United States Border Patrol, and Peter J. Forcelli, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), Miami Field Office, made the announcement.
Felipe Benitez Aguilar, 44, of West Palm Beach, previously pled guilty to possession with intent to distribute over 5 kilograms of cocaine, felon in possession of a firearm, and alien in possession of a firearm.
On September 19, 2017, a West Palm Beach Grand Jury returned a five-count indictment charging Aguilar with possession with intent to distribute over 5 kilograms of cocaine, felon in possession of a firearm, alien in possession of a firearm, possession of a firearm in furtherance of a drug trafficking crime, and illegal re-entry after deportation or removal. According to court documents, Aguilar was found in possession of over 30 kilogram-sized packages of cocaine, an UZI rifle, a revolver, and multiple rounds of ammunition. Aguilar had been previously removed from the United States in February 2004 and again in July 2012. Aguilar’s July 2012 removal followed his 37-month federal sentence for conspiracy to possess with intent to distribute over 500 grams of cocaine.
Judge Bloom sentenced Aguilar to the mandatory-minimum term of 20 years in prison for the drug count, and concurrent terms of 10 years in prison on each firearms count.
Mr. Greenberg commended the investigative efforts of the DEA, ICE-ERO, Border Patrol, and ATF. This case was prosecuted by Assistant United States Attorney Rinku Tribuiani.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov/ or on http://pacer.flsd.uscourts.gov/.
Treatment Center Owners Plead Guilty in Multi-Million Dollar Health Care Fraud and Money Laundering Scheme Involving Sober Homes and Alcohol and Drug Addiction Treatment CentersRead the Press Release
Two treatment center owners pled guilty for their participation in a multi-million dollar health care fraud and money laundering scheme that involved the filing of fraudulent insurance claim forms and defrauded health care benefit programs.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida; Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office; Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI); Jimmy Patronis, Florida Chief Financial Officer; Michael J. Waters, Special Agent in Charge, Amtrak Office of Inspector General (Amtrak-OIG); Isabel Colon, Regional Director, United States Department of Labor, Employee Benefits Security Administration (DOL-EBSA); and Dennis Russo, Director of Operations, National Insurance Crime Bureau (NICB), made the announcement.
Tovah Lynn Jasperson, a/k/a Tara, 48, of Wellington, pled guilty to one count of conspiracy to commit health care fraud, in violation of Title 18, United States Code, Section 1347; all in violation of Title 18, United States Code, Section 1349.
Alan Martin Bostom, 75, of Wellington, pled guilty to one count of making false statements related to a health care matter, in violation of Title 18, United States Code, Section 1035(a)(1).
According to court documents, Jasperson and Bostom were the owners of Angel’s Recovery, a business with multiple locations in Palm Beach County that purportedly operated as a licensed substance abuse service provider (or treatment center) offering clinical treatment services for persons suffering from alcohol and drug addiction. Angel’s Recovery also offered medication-based treatment for opioid addiction.
At different times, the defendants managed all aspects of Angel’s Recovery, including hiring and firing personnel, admitting and discharging patients, and making financial decisions. To secure a steady stream of patients, the defendants established illegal kickback/bribe relationships with owners of sober homes, in exchange for referring the sober homes’ insured residents to Angel’s Recovery for treatment. Sober homes were purportedly in the business of providing safe and drug-free residences for individuals suffering from drug and alcohol addiction. The defendants provided the money used to purchase or rent several properties used as “sober homes,” although the purchase agreements or leases would bear the names of third parties.
The defendants and co-conspirators provided kickbacks and bribes, in the form of free or reduced rent, insurance premium payments, and other benefits to individuals with insurance who agreed to reside at the sober homes and attend drug treatment, which included regular and random drug testing (typically three or more times per week), so that members of the conspiracy could bill the testing and treatment to the residents’ insurance plans. To disguise kickbacks and bribes to patients, the defendants used a separate entity to pay insurance premiums for patients of Angel’s Recovery so that Angel’s Recovery could continue to bill the patients’ insurance companies for treatment expenses.
Jasperson and Bostom hired a doctor to serve as the medical director of Angel’s Recovery who frequently pre-signed prescriptions that were used to dispense controlled substances to patients of Angel’s Recovery by other employees. After the doctor’s medical license was suspended, the defendants continued to employ him and failed to inform the Florida Department of Children and Families because it could not continue to operate as a licensed facility without a licensed medical director.
The defendants and co-conspirators caused the submission of insurance claims that: falsely stated the testing and treatment were medically necessary, failed to disclose that patients were referred to Angel’s Recovery in exchange for kickbacks and bribes, failed to disclose that patients were not asked to pay kickbacks and deductibles, failed to disclose that the defendants paid some patients’ insurance premiums, and failed to disclose that the prescribing physician’s license was suspended.
Jasperson faces a maximum of 10 years imprisonment. Bostom faces a maximum of five years imprisonment. Sentencing is scheduled for May 11, 2018 at 10 a.m.
Mr. Greenberg commended the investigative efforts of the Greater Palm Beach Health Care Fraud Task Force. Agencies of the task force include the FBI, IRS-CI, the Florida Division of Investigative and Forensic Services, Amtrak-OIG, DOL-EBSA, and NICB. The cases are being prosecuted by Assistant United States Attorney A. Marie Villafaña.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov/ or on http://pacer.flsd.uscourts.gov/
Former Missionary Sentenced for Sexually Exploiting Children in HaitiRead the Press Release
Daniel John Pye, 36, an Ashdown, Arkansas, resident was sentenced to 40 years of imprisonment, to be followed by 25 years of supervised release, for traveling in foreign commerce with the purpose of engaging in illicit sexual conduct with a minor, also known as child sex tourism.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, and Mark Selby, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), Miami Field Office, made the announcement.
Pye, originally of Bradenton, Florida, was convicted in November 2017, after a week-long trial before U.S. District Judge Ursula Ungaro, of three counts of traveling in foreign commerce with the purpose of engaging in illicit sexual conduct with a minor, in violation of Title 18, United States Code, Section 2423(b).
According to court records and the evidence presented at trial, Pye was a missionary who operated an orphanage in Jacmel, Haiti, from the years of 2006 through 2012. The orphanage provided shelter, clothing, food, and school tuition to children without families and to children whose families could not afford to feed or otherwise support their children. Pye obtained financial support for the orphanage through his connections with numerous religious organizations and other nonprofit groups in the United States. During his time operating the orphanage, Pye would regularly sexually abuse the female residents of his orphanage, including girls as young as six years old. As described by the Haitian victims during trial, Pye routinely sexually abuse his victims both at the orphanage and while at the beach.
Since leaving Haiti, Pye resided in the Liberty Hill, Texas, Texarkana, Texas, and Ashdown, Arkansas, areas. Prior to arriving in Haiti, Pye resided in the Bradenton and Fort Lauderdale areas of Florida.
Mr. Greenberg commended the investigative efforts of ICE-HSI. The case was prosecuted by Assistant U.S. Attorneys Ben Widlanski and Ilham Hosseini.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Broward County Pharmacy Agrees to Pay the United States $350,000 to Settle Allegations That it Submitted Fraudulent Claims to TRICARERead the Press Release
Healthy Meds Pharmacy Corp., a pharmacy located in Hallandale, Florida has paid the United States $350,000, to settle allegations under the False Claims Act for filling prescriptions in violation of TRICARE’s policy on telemedicine.
Benjamin Greenberg, United States Attorney for the Southern District of Florida, and John F. Khin, Special Agent in Charge, Defense Criminal Investigative Service (DCIS), made the announcement.
The settlement results from an investigation initiated by the DCIS into Healthy Meds’ alleged violations of TRICARE’s policy on telemedicine. The United States alleged that between February 2015 and May 2015, Healthy Meds engaged in unsolicited calls to TRICARE beneficiaries, provided medically unnecessary compound medications to beneficiaries, and knowingly filled prescriptions from doctors who did not meet or properly consult with TRICARE beneficiaries. TRICARE is the Department of Defense program that provides health care benefits to active duty service members, retired service members, and their dependents.
“This settlement shows our continued resolve to pursue providers who improperly provide prescription drugs resulting in significantly increased costs to taxpayers,” said Benjamin Greenberg, United States Attorney for the Southern District of Florida.
Special Agent in Charge John F. Khin, Southeast Field Office, Defense Criminal Investigative Service (DCIS), said, “The DoD TRICARE Program relies on health care professionals to provide the best care and services available to our military members and their families, while preserving precious taxpayer dollars. This settlement demonstrates the effectiveness of DCIS investigations to ensure that medical providers conduct business with integrity and in full compliance with Federal laws.”
The settlement was the result of a coordinated effort by the United States Attorney’s Office for the Southern District of Florida and DCIS. The case was investigated and the settlement negotiated by Assistant U.S. Attorney John C. Spaccarotella. The claims settled by the lawsuit are allegations only, and there has been no determination of liability.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Four Peruvian Members of Multi-Billion Dollar, International Gold Money Laundering Scheme IndictedRead the Press Release
Four Peruvian citizens were indicted for their alleged involvement in a multi-billion dollar, international gold money laundering scheme.
Randy A. Hummel, Executive Assistant United States Attorney, U.S. Attorney’s Office for the Southern District of Florida, Carlos L. Mitchem, Regional Director, Drug Enforcement Administration (DEA-Peru), Southern Cone Region, Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, Mark Selby, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), Miami Field Office, Adolphus P. Wright, Special Agent in Charge, Drug Enforcement Administration (DEA-Miami), Miami Field Office, and Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), Miami Field Office, made the announcement.
On November 16, 2017, Pedro David Perez Miranda, a/k/a “Peter Ferrari,” a/k/a “Peter,” 57, of Lima, Gian Piere Perez Gutierrez, a/k/a “GP,” 33, of Lima, Peter Davis Perez Gutierrez, a/k/a “Peter Jr.,” 33, of Lima, and Jose Estuardo Morales Diaz, a/k/a “Pepe Morales,” 50, of Lima, were charged in a single-count Indictment for their alleged participation in a gold money laundering scheme (U.S. v. Miranda, Case No. 17-cr-20814). Gian Piere Perez Gutierrez and Peter Davis Perez Gutierrez were arrested in connection with this scheme.
Also named in the Indictment are alleged co-conspirators Samer H. Barrage, Renato J. Rodriguez, and Juan P. Granda who previously pled guilty to conspiracy to commit money laundering in related case: U.S. v. Barrage, et al., Case No. 17-cr-20215.
According to Barrage and Granda’s factual proffer in Case No. 17-cr-20215, from January 2013 through March 2017, Barrage, Rodriguez, Granda, and others conspired to purchase billions of dollars of criminally derived gold from Latin America and the Caribbean, which they believed to be or which in fact were the proceeds of unlawful criminal activities (including illegal mining, foreign bribery, foreign smuggling, foreign narcotics trafficking, and the entry of goods into the United States by false means and statements), through Elemetal LLC, a dealer in precious metals operating in the Southern District of Florida and “financial institution,” as defined in Title 18, United States Code, Section 1956(c)(6)(A), in violation of Title 18, United States Code, Section Sections 1956(h) and 1957.
In addition, Barrage, Rodriguez, Granda, and others conspired to promote criminal activities (including illegal mining, foreign bribery, foreign smuggling, foreign narcotics trafficking, and the entry of goods into the United States by false means and statements) by transmitting billions of dollars of wire payments from the United States to Latin America and the Caribbean to promote the delivery of additional criminally derived gold, in violation of Title 18, United States Code, Section Sections 1956(h) and 1956(a)(2)(A).
These cases are the result of the ongoing efforts by the Organized Crime Drug Enforcement Task Force (OCDETF) “Operation Arch Stanton”, a partnership between federal, state and local law enforcement agencies. The OCDETF mission is to identify, investigate, and prosecute high level members of drug trafficking enterprises, bringing together the combined expertise and unique abilities of federal, state and local law enforcement.
Mr. Hummel commended the investigative efforts of the DEA-Peru, FBI, ICE-HSI, DEA-Miami, and IRS-CI. Mr. Hummel also thanked the Department of Justice’s Office of International Affairs, U.S. Customs and Border Protection, and the Peruvian Government for their assistance in this matter. This case is being prosecuted by Assistant U.S. Attorney Francisco R. Maderal.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Broward Resident Sentenced in Stolen Identity Tax Refund Fraud SchemeRead the Press Release
A Broward resident was sentenced to 24 months and one day in prison, to be followed by three years of supervised release, and was ordered to pay $87,562 in restitution.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida; Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI); and Brian Swain, Special Agent in Charge, U.S. Secret Service (USSS), Miami Field Office; made the announcement.
Woodley Louis-Jacques, 31, of Tamarac, pled guilty to one count of using unauthorized access devices and one count of aggravated identity theft, in violation of Title 18, United States Code, Sections 1029(a)(2) and 1028A.
According to court documents, in 2014 a bank noticed suspicious activity occurring at the drive through ATM at one of its branches. Excessive withdrawals were occurring with the same cards. An individual covered the camera with what appeared to be sticky notes, and then spent long periods of time inserting multiple cards into the machine to withdraw cash. The bank records showed approximately 204 transactions (on 45 different days) and approximately $66,880, in withdrawals from 41 different cards from February 2014 to September 2014.
ATM videos and photos show that Louis-Jacques was the person utilizing the ATM in approximately 24 of these instances, which accounted for over 100 different transactions using approximately 26 different cards. Louis-Jacques often withdrew funds from some of the same cards multiple times on each ATM visit. The cards were prepaid cards that allow low to moderate-income families the opportunity to load their tax refunds onto these prepaid cards.
Ninety-nine (99) tax returns were filed requesting refunds totaling $378,688, where the refund was directed onto the cards. The tax returns were filed using the same IRS Electronic Filing Identification Number (EFIN), and the EFIN was registered to Louis-Jacques. Law enforcement interviewed some of the victims whose identities were used for the filing of federal tax returns that directed associated tax refunds to the prepaid cards. None of these individuals knew Louis-Jacques or authorized this activity.
On August 1, 2014, Louis-Jacques was the passenger in a vehicle stopped by law enforcement in Georgia for travelling at a high rate of speed. During a vehicle search, law enforcement found multiple phones, a laptop, a black wallet with Louis-Jacques’s identification card and a prepaid card issued in another individual’s name. Behind the glove box was a folder containing numerous printed screenshots of personal identifying information (approximately 200 names and social security numbers) that appeared to be a customer list from tax software.
After the defendant was arrested on September 21, 2017, he admitted his participation in the scheme and that he was the only one who filed taxes from that EFIN.
Mr. Greenberg commended the investigative efforts of IRS-CI and the USSS. The case was prosecuted by Assistant United States Attorney Cynthia R. Wood.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Florida Resident Sentenced to Prison for Stolen Identity Refund FraudRead the Press Release
A Lauderhill, Florida, resident was sentenced to 48 months in prison for his role in a stolen identity refund fraud scheme, announced Principal Deputy Assistant Attorney General Richard Zuckerman of the Justice Department’s Tax Division and Acting United States Attorney Benjamin G. Greenberg of the Southern District of Florida.
According to documents and information provided to the court, from approximately 2008 through January 2015, in Broward and Miami-Dade Counties, Evens Julien, 53, and others, used stolen IDs, including the personal identifying information of prisoners and deceased individuals, to file over 2,000 tax returns with the Internal Revenue Service (IRS). These fraudulent returns sought more than $2 million in refunds. Julien and his co-conspirators recruited others to obtain Electronic Filing Identification Numbers from the IRS in their names and used the EFINs to file the fraudulent returns. They directed the refunds to debit cards and treasury checks and had them mailed to South Florida addresses. They then cashed the fraudulently obtained refund checks at check cashing stores and used Western Union and ATMs to withdraw the funds.
Julien pleaded guilty in October to conspiring to defraud the IRS, commit wire fraud, and commit aggravated identity theft and aggravated identity theft. In addition to the term of prison imposed, U.S. District Judge Federico A. Moreno ordered Julien to serve four years of supervised release and to pay $1,169,000 in restitution to the IRS.
Principal Deputy Assistant Attorney General Zuckerman and Acting U.S. Attorney Greenberg commended special agents of Internal Revenue Service Criminal Investigation, who conducted the investigation, and Assistant U.S. Attorney Neil Karadbil of the Southern District of Florida and Assistant Chief Greg Tortella of the Tax Division, who prosecuted the case.
Additional information about the Tax Division’s enforcement efforts can be found on the division’s website.
Florida Resident Sentenced to Prison for Stolen Identity Refund FraudRead the Press Release
A Lauderhill, Florida, resident was sentenced to 48 months in prison for his role in a stolen identity refund fraud scheme, announced Principal Deputy Assistant Attorney General Richard Zuckerman of the Justice Department’s Tax Division and Acting United States Attorney Benjamin G. Greenberg of the Southern District of Florida.
According to documents and information provided to the court, from approximately 2008 through January 2015, in Broward and Miami-Dade Counties, Evens Julien, 53, and others, used stolen IDs, including the personal identifying information of prisoners and deceased individuals, to file over 2,000 tax returns with the Internal Revenue Service (IRS). These fraudulent returns sought more than $2 million in refunds. Julien and his co-conspirators recruited others to obtain Electronic Filing Identification Numbers from the IRS in their names and used the EFINs to file the fraudulent returns. They directed the refunds to debit cards and treasury checks and had them mailed to South Florida addresses. They then cashed the fraudulently obtained refund checks at check cashing stores and used Western Union and ATMs to withdraw the funds.
Julien pleaded guilty in October to conspiring to defraud the IRS, commit wire fraud, and commit aggravated identity theft and aggravated identity theft. In addition to the term of prison imposed, U.S. District Judge Federico A. Moreno ordered Julien to serve four years of supervised release and to pay $1,169,000 in restitution to the IRS.
Principal Deputy Assistant Attorney General Zuckerman and Acting U.S. Attorney Greenberg commended special agents of Internal Revenue Service Criminal Investigation, who conducted the investigation, and Assistant U.S. Attorney Neil Karadbil of the Southern District of Florida and Assistant Chief Greg Tortella of the Tax Division, who prosecuted the case.
Additional information about the Tax Division’s enforcement efforts can be found on the division’s website.
Beach Aviation Owner Robert “Charles” Brady Arrested on 56-Count IndictmentRead the Press Release
Robert Charles Brady, 36, of Fort Lauderdale, was arrested after being charged for wire fraud, filing false records in federal investigation and operating an aircraft without an airman’s certificate. U.S. Magistrate Judge Dave Lee Brannon ordered that Brady be detained.
Benjamin G. Greenberg, Acting United States Attorney for the Southern District of Florida, and Marlies T. Gonzalez, Regional Special Agent in Charge, U.S. Department of Transportation, Office of the Inspector General (DOT-OIG), made the announcement.
As alleged in the Indictment, from 2012 to October 2017, Brady owned Beach Aviation, formerly located in Pompano and Boca Raton. It is alleged that Brady operated an illegal charter air carrier service and flight school in which Brady and his employees chartered flights to and from Bahamas and other destinations in the United States without authorization from the FAA. In addition, Brady falsified records seeking a second-in-command rating on a convair jet and claimed to be certified flight instructor on student logbooks, which were relied upon by students and FAA to verify flight hours for FAA pilot certifications and ratings.
The Indictment charges Brady with 56 separate counts. If convicted, Brady faces a maximum sentence of 20 years on each of the 12 counts of wire fraud, 20 years on each of the 17 counts of filing false records in a federal investigation, and three years on each of the 27 counts of operating an aircraft without an airman’s certificate.
Mr. Greenberg commended the investigative efforts of DOT-OIG and the Federal Aviation Administration. The case is being prosecuted by Assistant U.S. Attorney Scott Behnke.
An indictment is only an accusation, and a defendant is presumed innocent unless and until proven guilty.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Miami-Dade County Residents Sentenced for Conspiracy to Illegally Export Prohibited Articles to Syria in Violation of U.S. Export Control LawsRead the Press Release
Three Miami-Dade residents were sentenced today for their roles in a conspiracy to defraud the United States and to illegally export aviation parts and equipment to Syria, contrary to comprehensive U.S. economic sanctions against Syria, in violation of Title 18, United States Code, Section 371 and the International Emergency Economic Powers Act (IEEPA), Title 50, United States Code, Sections 1701-1706. The exports were sent to Syrian Arab Airlines, a/k/a “Syrian Air” (Syrian Air). Syrian Air had been designated as a Specially Designated National (SDN) by the U.S. Department of Treasury, Office of Foreign Assets Control (OFAC), meaning that U.S. persons and entities were prohibited from doing business with Syrian Air without a license.
Benjamin G. Greenberg, Acting United States Attorney for the Southern District of Florida, Dana J. Boente, Acting Assistant Attorney General for the Justice Department’s National Security Division, Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, Robert Luzzi, Special Agent in Charge, U.S. Department of Commerce’s Office of Export Enforcement (DOC), Miami Field Office, and the members of the South Florida Joint Terrorism Task Force, made the announcement.
Ali Caby, a/k/a “Alex Caby”, 40, was sentenced by U.S. District Court Judge Beth Bloom to 24 months in prison, followed by two years of supervised release. Co-defendant Arash Caby, a/k/a “Axel Caby”, 43, was sentenced to 24 months in prison, followed by two years of supervised release and a $10,000 fine. Co-defendant Marjan Caby, 34, was sentenced to 12 months and one day in prison, followed by two years of supervised release. The defendants had previously pled guilty to the charged conspiracy to violate IEEPA by exporting dual-use goods, that is, articles that have both civilian and military application, without a license to Syrian Air, the Syrian government’s airline, which is an entity designated and blocked by OFAC for transporting weapons and ammunition to Syria in conjunction with Hizballah, a terrorist organization, and the Iranian Revolutionary Guard Corps (IRGC).
Ali Caby ran the Bulgaria office of AW-Tronics, a Miami export company that was managed by Arash Caby, and which shipped and exported various aircraft parts and equipment to Syrian Arab Airlines. Ali Caby and Arash Caby closely supervised and encouraged subordinate employees of AW-Tronics in the willful exportation of the parts and equipment to SDN Syrian Air, whose activities have assisted the Syrian government’s violent crackdown on its people. Marjan Caby, as AW-Tronics’ export compliance officer and auditor, facilitated these exports by submitting false and misleading electronic export information to federal agencies.
Mr. Greenberg and Mr. Boente commended the investigative efforts of the FBI, DOC, Department of Homeland Security (HSI), Defense Criminal Investigative Service, U.S. Customs and Border Protection and the South Florida Joint Terrorism Task Force. The case is being prosecuted by Assistant U.S. Attorneys Ricardo Del Toro and Michael Thakur and Trial Attorney Matthew Walczewski of the Counterintelligence and Export Control Section of the Department of Justice’s National Security Division.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Former Chief Financial Officer at Publicly Traded Company Charged with Accounting and Securities Fraud SchemeRead the Press Release
A former chief financial officer for Bankrate Inc., a publicly traded financial services and marketing company headquartered in North Palm Beach, Florida, was charged in an indictment unsealed today for his alleged participation in a complex accounting and securities fraud scheme.
Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, Acting U.S. Attorney Benjamin Greenberg of the Southern District of Florida and Inspector in Charge Regina Faulkerson of the U.S. Postal Inspection Service’s Criminal Investigations Group made the announcement.
Edward J. DiMaria, 52, of Fairfield County, Connecticut, was charged in an indictment filed in the Southern District of Florida with one count of conspiracy to make false statements to a public company’s accountants and to falsify a public company’s books, records and accounts; six counts of false entries in a public company’s books, records and accounts; three counts of false statements to a public company’s accountants; one count of conspiracy to commit securities fraud and wire fraud; one count of wire fraud and one count of securities fraud. DiMaria, who previously worked at Bankrate’s offices in New York City, made his initial appearance earlier today before U.S. Magistrate Judge Edwin G. Torres of the Southern District of Florida and was released on bond.
“The deceptive accounting practices that Edward DiMaria allegedly engaged in can cause real financial harm to investors, along with broader reputational harm to U.S. markets and our country,” said Acting Assistant Attorney General Cronan. “Safeguarding the integrity of our markets – while holding responsible those executives who refuse to follow the rule of law – are important priorities for the Department of Justice and our law enforcement partners.”
“This type of sophisticated financial fraud scheme can have a negative impact on the financial markets in the United States and around the world,” said Inspector in Charge Faulkerson. “Anyone who engages in such conduct should know they will not go undetected and be held accountable. The U.S. Postal Inspection Service has an extensive history of investigating complex financial fraud schemes in order to protect investors as well as the integrity of the financial marketplace from fraudulent activities by trusted insiders who abuse their positions.”
The indictment alleges that between 2011 and 2014, DiMaria and his co-conspirators carried out a complex scheme to manipulate Bankrate’s financial statements and artificially inflate Bankrate’s earnings. According to the indictment, DiMaria and his co-conspirators allegedly engaged in so-called “cookie jar” or “cushion” accounting where over a million dollars in unsupported expense accruals were left on Bankrate’s books and then selectively reversed in later quarters to meet earnings goals. In addition, DiMaria and his co-conspirators allegedly misrepresented certain company expenses as “deal costs” in order to artificially inflate publicly reported adjusted earnings metrics, and made materially false statements to conceal the improper accounting entries from Bankrate’s auditors, shareholders and the investing public. The indictment further alleges that while Mr. DiMaria was misleading Bankrate’s auditors and the public about the company’s financial condition he realized millions of dollars from selling his own shares of Bankrate stock.
An indictment is merely an allegation and the defendant is presumed innocent unless proven guilty beyond a reasonable doubt in a court of law.
The U.S. Postal Inspection Service Washington, D.C. Division investigated the case. Assistant Chief Henry Van Dyck and Trial Attorneys Emily Scruggs and Jason Covert of the Criminal Division’s Fraud Section are prosecuting the case with assistance from the U.S Attorney’s Office for the Southern District of Florida. The Securities and Exchange Commission also provided assistance in this matter.