Northern District of Illinois

ROCKFORD — An Elgin resident pleaded guilty today before U.S. District Judge Frederick J. Kapala to federal fraud charges.

STEPHEN T. ANGERMAN, 48, pleaded guilty to bank fraud, money laundering, and testifying falsely in a bankruptcy case. 

According to the written plea agreement, from December 2009 through March 31, 2010, Angerman schemed to fraudulently obtain a $510,000 loan from Alliant Credit Union and a $64,590 loan from Prairie Community Bank in order to purchase a home on Wrenwood Circle in Elgin.  Angerman admitted to making false statements on his loan application to Alliant about his employment, assets, and liabilities.  Further, Angerman admitted to submitting fictitious bank account statements, pay stubs, and a W-2 earnings form, and a fraudulent Certificate of Gift form to the credit union in support of his application.  Alliant issued the loan based upon Angerman’s representations. 

Angerman admitted that in December 2009 and January 2010, he applied for and obtained a $64,590 loan from Prairie Community Bank by pledging a 2008 Chevrolet Corvette as collateral without disclosing that the Corvette was subject to a prior lien of approximately $40,000 held by another bank.   

With regard to the money laundering charge, Angerman admitted that on March 23, 2010, he transferred most of the proceeds, $64,500, from his checking account at Allied Credit Union to an account in the name of a relative at a different bank in an attempt to conceal his bank fraud against Prairie Community Bank.

On Jan. 3, 2011, Angerman filed for bankruptcy in Rockford.  Angerman admitted that on Feb. 7, 2011, he falsely testified under oath at a meeting of creditors by stating he did not own any real estate other than what he had listed in his bankruptcy schedules, and that he did not own a car, when in fact he owned the home on Wrenwood Circle in Elgin and the Corvette. 

Angerman faces up to 30 years’ imprisonment for bank fraud, a fine of up to $1,000,000, and a term of supervised release of up to 5 years.  For money laundering, Angerman faces a sentence of up to 20 years’ imprisonment, a fine of up to $500,000, and a term of supervised release of not more than 3 years.  Angerman also is subject to a civil penalty of twice the value of the property involved in the transaction.  For falsely testifying in his bankruptcy case, Angerman faces up to 5 years in prison, a $250,000 fine, and supervised release of up to 3 years.  The judge must also order Angerman to pay restitution.  Sentencing is set for Oct. 3, 2016, at 2:30 p.m.

The guilty plea was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of Federal Bureau of Investigation; and James D. Robnett, Special Agent-in-Charge of the Internal Revenue Service - Criminal Investigation Division in Chicago.

The government is represented by Assistant U.S. Attorney Joseph C. Pedersen.

Plea Agreement

CHICAGO — Two north suburban doctors have been charged as part of the largest national Medicare fraud takedown in history, federal authorities announced today.

Attorney General Loretta E. Lynch and Department of Health and Human Services Secretary Sylvia Mathews Burwell announced the unprecedented nationwide sweep that resulted in criminal and civil charges against 301 individuals, including 61 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $900 million in false billings.  Twenty-three state Medicaid Fraud Control Units participated in the takedown.  In addition, the HHS Centers for Medicare & Medicaid Services (CMS) is suspending payment to a number of providers using its suspension authority provided in the Affordable Care Act.  This coordinated takedown is the largest in history, both in terms of the number of defendants charged and the loss amount.    

“As this takedown should make clear, health care fraud is not an abstract violation or benign offense – it is a serious crime,” said Attorney General Lynch.  “The wrongdoers that we pursue in these operations seek to use public funds for private enrichment.  They target real people – many of them in need of significant medical care.  They promise effective cures and therapies, but they provide none.  Above all, they abuse basic bonds of trust – between doctor and patient; between pharmacist and doctor; between taxpayer and government – and pervert them to their own ends.  The Department of Justice is determined to continue working to ensure that the American people know that their health care system works for them – and them alone.”

Two registered Illinois physicians were charged as part of the investigations, announced Zachary T. Fardon, United States Attorney for the Northern District of Illinois. 

DR. YEVGENY ODESSKY, a physician with an office in Buffalo Grove, took cash kickbacks in exchange for referring patients to a home health care agency in the north suburbs, according to a criminal complaint filed last week in federal court in Chicago.  Unbeknownst to Dr. Odessky, the owner of the agency was cooperating with federal authorities and had agreed to secretly record meetings with Dr. Odessky, according to the complaint.  In one recorded meeting in Dr. Odessky’s clinic on April 26, 2014, Dr. Odessky agreed to accept $300 for each Medicare beneficiary he referred to the agency, according to the complaint.  Speaking in Russian, Dr. Odessky is heard on the recording laughing while telling the agency owner, “Public Aid will choke,” according to the complaint.

Dr. Odessky, 66, of Highland Park, is charged with one count of violating the federal Medicare and Medicaid Anti-Kickback Statute, which is punishable by up to five years in prison and a fine of up to $250,000.  A preliminary hearing in federal court in Chicago is scheduled for July 11, 2016, at 1:00 p.m.

DR. ZOYA KOSMAN, a physician with an office in Skokie, allegedly caused the submission of false medical evidence to help a claimant obtain federal disability benefits to which the claimant was not entitled.  Dr. Kosman knowingly lied about the claimant’s complaints, symptoms, and functional abilities in documentation submitted in support of the claimant’s application for benefits, according to an indictment returned yesterday in federal court in Chicago.

The indictment charges Dr. Kosman, 58, of Skokie, with one count of making false statements in an application for federal benefits.  The charge carries a maximum sentence of ten years in prison and a fine of up to $250,000.  An arraignment in federal court in Chicago has not yet been scheduled. 

The cases announced today were investigated by the national Medicare Fraud Strike Force, whose operations are part of the Health Care Fraud Prevention & Enforcement Action Team.  Since its inception in March 2007, the Strike Force has charged more than 2,900 defendants who collectively have falsely billed the Medicare program more than $8.9 billion.

The Illinois cases are being prosecuted by the U.S. Attorney’s Office for the Northern District of Illinois.  The government in Dr. Odessky’s case is represented by Assistant U.S. Attorney Nathalina A. Hudson, and in Dr. Kosman’s case by Special Assistant U.S. Attorney Jared C. Jodrey.

The national cases announced today are being prosecuted and investigated by U.S. Attorney’s Offices nationwide, along with agents from the Federal Bureau of Investigation, HHS-OIG, Drug Enforcement Administration, DCIS and state Medicaid Fraud Control Units.

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

CHICAGO — An Oak Brook couple who owned First Mutual Bancorp of Illinois and other financial entities intentionally hid cash and assets from creditors after defaulting on $40 million in personal and corporate loans, according to an indictment returned in federal court in Chicago.

PETHINAIDU VELUCHAMY and his wife, PARAMESWARI VELUCHAMY, were the principal shareholders of First Mutual Bancorp of Illinois Inc., a holding company for Mutual Bank.  In June 2009, according to the indictment, the couple defaulted on personal and corporate loans totaling $40 million.  The following month, Mutual Bank was shut down by federal regulators.  Prior to the shutdown and continuing until at least November 2015, the couple hid millions of dollars in assets by falsifying documents, moving money into domestic and foreign bank accounts, and directing employees to destroy financial records, the indictment states.  The couple also transferred cash to their two adult children, with nearly $8.5 million going to one and more than $10.1 million to the other, according to the indictment.

The 12-count indictment was returned yesterday in U.S. District Court in Chicago.  It charges Pethinaidu Veluchamy, 70, with four counts of bank fraud, two counts of destroying records to obstruct a bankruptcy proceeding, two counts of making a false statement under oath in a bankruptcy proceeding, and one count of making a false statement in an application for a U.S. passport.  Parameswari Veluchamy, 65, is charged with four counts of bank fraud, two counts of destroying records to obstruct a bankruptcy proceeding, one count of making a false statement under oath in a bankruptcy proceeding, and one count of making a false statement in an application for a U.S. passport.

Arraignments in federal court in Chicago have not yet been scheduled.

According to the charges, Pethinaidu Veluchamy caused his relatives to obtain legal judgments against him for loans for which he knew he was not personally liable, so that he could later assert those liens as superior to a bank creditor’s anticipated judgments.  In a 2011 deposition in a separate court case, Pethinaidu Veluchamy fraudulently claimed that certain funds transferred to his adult children represented indemnity obligations for their investments in First Mutual Bancorp, according to the indictment.   He produced a document to support this claim, but when questioned about the timing of the creation of the document, Pethinaidu Veluchamy claimed the computer he had used to create it crashed in a snowstorm, according to the indictment.

The indictment was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; and Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.

Each count of bank fraud is punishable by up to 30 years in prison and a $1 million fine.  Destroying records to obstruct a bankruptcy proceeding carries a maximum sentence of 20 years.  The maximum sentence for making a false statement under oath in a bankruptcy proceeding is five years, while making a false statement in an application for a U.S. passport is punishable by up to ten years.

The public is reminded that an indictment is not evidence of guilt.  The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.  If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.

The government is represented by Assistant U.S. Attorney Bethany Biesenthal and Special Assistant U.S. Attorney Jeffrey Snell.

Indictment

CHICAGO —  The Civil Rights Division of the United States Department of Justice, along with the United States Attorney’s Office for the Northern District of Illinois, are conducting a civil pattern or practice investigation into the Chicago Police Department.  As part of the investigation, officials will be hosting public forums to provide information about the investigative process, and to offer time for community members to share their experiences with policing in Chicago.

The dates and locations of the forums are as follows:

June 22, 6:30 p.m. to 8:30 p.m.

Kennedy King City College (U Building)

740 W. 63rd St., Chicago IL 60621

July 12, 6:30 p.m. to 8:30 p.m.

Truman City College

1145 W. Wilson Ave., Chicago IL 60640

July 14, 6:30 p.m. to 8:30 p.m.

KROC Center Chapel

1250 W. 119th St., Chicago IL 60643

The forums are free of charge and open to the public and the media.

The purpose of the pattern or practice investigation is to determine whether there are systemic violations of the Constitution or federal law by the Chicago Police Department.  The investigation is focused on use of force, including racial, ethnic and other disparities in its use of force, as well as police accountability systems, including how internal investigations are conducted, how the police department responds to citizen complaints, and how it handles officer discipline.

Community members who are unable to attend the forums but wish to share information relevant to the investigation are encouraged to contact the Department of Justice by phone: (844) 401-3735 or email: [email protected].

CHICAGO — A federal jury today convicted a Lockport subcontractor on fraud charges for scheming to help a general contractor falsely satisfy its female hiring requirement on city of Chicago construction projects.

As the owner of a certified Women’s Business Enterprise, ELIZABETH PERINO agreed to allow her company to be claimed as a subcontractor on city projects so that the general contractor could satisfy its requirement to assign a portion of the work to female-owned businesses.  Perino falsified paperwork to conceal the fact that her business, Perdel Contracting Co., would perform no actual work on the projects.  As a result of Perino’s fraud, Perdel expected to receive payment equivalent to a percentage of the work that Perdel fraudulently claimed to have performed.

Perino, 62, of Willowbrook, was convicted on three counts of wire fraud and one count of mail fraud.  The conviction is punishable by a maximum sentence of 80 years in prison.

U.S. District Judge Gary Feinerman will schedule a sentencing hearing at a later date.

A city of Chicago ordinance establishes an overall goal of awarding at least 5% of total annual funding of all city contracts to WBEs.  For contracts with values exceeding $10,000, each contractor has to commit a certain percentage of labor to WBEs, either as a joint venture or subcontractor, or by purchasing goods or services from a WBE.  In addition to being a WBE, Lockport-based Perdel, which specializes in concrete and carpentry work, also qualified to participate in city projects as a certified Disadvantaged Business Enterprise.

Evidence at the four-day trial revealed that Perino and a co-worker agreed to act as a “pass-through” WBE/DBE on two city projects, meaning that Perdel’s employees would perform no work and Perdel’s equipment would not be used.  For one of the projects – at O’Hare International Airport – Perino agreed to place the general contractor’s employees on Perdel’s payroll to perform the work that would be credited to Perdel.  Perino also entered into a sham contract to “purchase” street sweepers from the general contractor and title them in Perdel’s name while the general contractor’s workers performed the street sweeping as purported employees of Perdel.  Perino and the general contractor further agreed that, at the conclusion of the O’Hare project, the street sweepers would be returned to the general contractor for $1 per machine, and Perdel would receive 18% on top of the labor costs and $20 per hour for the street sweepers.

The conviction was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Michael J. Anderson, Special Agent in Charge of the Chicago Office of the Federal Bureau of Investigation; Thomas Ullom, Special Agent-in-Charge of the U.S. Department of Transportation Office of Inspector General in Chicago; James Vanderberg, Special Agent-in-Charge of the Chicago Region of the U.S. Department of Labor’s Office of Inspector General, Office of Labor Racketeering and Fraud Investigations; and Joseph M. Ferguson, Inspector General for the City of Chicago. 

The government is represented by Assistant U.S. Attorneys Megan Cunniff Church and Matthew Kutcher.

CHICAGO — A youth basketball coach from Chicago has been indicted on federal child pornography charges for allegedly paying minor boys to be photographed and video-recorded while engaged in sexually explicit conduct.

BRADLEY J. AMES, 35, and a co-conspirator paid approximately $100 to $650 to the minor boys in return for being photographed and video-recorded while engaged in various sexual acts, according to the indictment.  Ames and the co-conspirator then transmitted the photos and videos over the Internet, the indictment states. 

The pair met most of the minors online after the co-conspirator set up a Facebook profile for a fictitious female named “Hannah,” and used it to encourage young males to share photos and information about themselves, according to the indictment.  Ames then selected certain minors who had communicated with “Hannah” so that the co-conspirator could pursue sexually explicit photos and videos of them, the indictment states.

The six-count indictment was returned yesterday in federal court in Chicago.  It charges Ames with one count of conspiracy to produce child pornography, four counts of producing child pornography, and one count of knowingly receiving child pornography. 

Ames will be arraigned before U.S. Magistrate Judge Jeffrey T. Gilbert on June 15, 2016, at 1:45 p.m.

In addition to contacting children online, the indictment alleges that Ames identified at least one minor victim through a boy he met while coaching youth basketball.  Ames provided the minor’s Facebook page to the co-conspirator to facilitate contacting the child, the indictment states.  The indictment further alleges that Ames sometimes paid the co-conspirator to engage in sexually explicit conduct with the minors.

The indictment was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; and James M. Gibbons, Acting Special Agent-in-Charge of the Chicago Office of the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI).

The conspiracy and production counts are punishable by a minimum sentence of 15 years in prison and a maximum of 30 years, while knowingly receiving child pornography carries a minimum sentence of five years in prison and a maximum of 20 years.

The public is reminded that an indictment is not evidence of guilt.  The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.  If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines. 

The government is represented by Assistant U.S. Attorney Yusef Dale.

Indictment

CHICAGO — A man who allegedly manufactured explosive devices and kept them in the bedroom of his Lindenhurst home was ordered detained in federal custody today.

U.S. Magistrate Judge Sidney Schenkier ordered MICHAEL SUOPYS, 28, held without bond on a charge of knowingly possessing an unregistered destructive device.  A detention hearing is scheduled for June 15, 2016, at 10:30 a.m. 

A federal criminal complaint alleges that Suopys built two pipe bombs by filling a metal pipe with Nitrocellulose and adding a wick.  Suopys was also charged in Lake County Circuit Court with possessing bombs containing an explosive substance, which is a Class 3 felony.  The state charge was dismissed this morning.

“Thankfully, law enforcement at the federal, state and local level was able to identify and safely interrupt the threat described in the complaint,” said Zachary T. Fardon, United States Attorney for the Northern District of Illinois.  “The Federal Bureau of Investigation, Lake County State’s Attorney’s Office and Lindenhurst Police Department are to be commended for their diligence and collaboration in this investigation.”

The federal complaint was announced by Mr. Fardon, along with Michael J. Anderson, Special Agent in Charge of the Chicago office of the FBI; Michael G. Nerheim, Lake County State’s Attorney; and Tom Jones, Chief of the Lindenhurst Police Department.

The federal charge carries a maximum sentence of ten years in prison and a fine of up to $250,000.

The public is reminded that a complaint is not evidence of guilt.  The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.  If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines. 

The government is represented by Assistant U.S. Attorney Matthew Hiller.

CHICAGO — The owner of a Lombard weight-loss center and a Burr Ridge physician have been charged with conspiracy and other crimes related to dispensing appetite-suppressant drugs without a legitimate medical purpose.

According to a 17-count federal indictment, MICHAEL JENNINGS, the owner of Results Weight Loss Center, made cash payments to the doctor in exchange for using the physician’s federal registration number to order and dispense hundreds of thousands of dosages of Phendimetrazine and Phentermine.  The physician, WILLIAM MIKAITIS, was rarely present at the weight-loss center, according to the indictment.  Instead, Jennings, who is not a doctor and lacks medical training, identified himself to patients as “Dr. Mikaitis” and ordered the prescriptions without conducting meaningful examinations or tests, the indictment states.

The indictment alleges that between approximately February 2013 and January 2015, Jennings made cash deposits of approximately $75,000 into Mikaitis’ bank account.  The indictment seeks a total forfeiture from the defendants of approximately $790,000 in illegal proceeds from the scheme.

The indictment was returned yesterday in federal court in Chicago.  It charges Jennings, 48, of Naperville, and Mikaitis, 72, of Burr Ridge, with one count of conspiracy to distribute controlled substances outside the course of professional practice and without a legitimate medical purpose, seven counts of distributing controlled substances outside the course of professional practice and without a legitimate medical purpose, seven counts of dispensing prescription drugs without a valid prescription, and one count of conspiracy to conduct a financial transaction involving the proceeds of unlawful activity.  The counts are punishable by a maximum combined sentence of 95 years in prison.

Mikaitis, who maintains a medical practice in Lockport, is also charged individually with one count of engaging in a monetary transaction involving criminally derived property valued at more than $10,000.  This count carries a maximum sentence of ten years in prison.

Jennings and Mikaitis will be arraigned before U.S. District Judge Virginia M. Kendall on June 9, 2016, at 9:30 a.m.

The indictment was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Dennis A. Wichern, Special Agent-in-Charge of the Chicago Field Division of the U.S. Drug Enforcement Administration; and James D. Robnett, Special Agent-in-Charge of the Internal Revenue Service Criminal Investigation Division in Chicago.  The U.S. Food and Drug Administration’s Chicago Office and the Naperville Police Department assisted in the investigation, which was conducted under the umbrella of the Organized Crime Drug Enforcement Task Force (OCDETF).  

The public is reminded that an indictment is not evidence of guilt.  The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.  If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines. 

The government is represented by Assistant U.S. Attorney Matthew Schneider.

Indictment

CHICAGO — The leader of a Chicago drug trafficking organization pleaded guilty in federal court today to distributing more than 1,000 kilograms of marijuana and laundering the proceeds by purchasing luxury cars and leasing high-rent properties.

JONATHAN TANKSON admitted in a plea agreement that he coordinated bulk shipments of marijuana from large-scale growers in California.  Between December 2010 and December 2013, Tankson flew to California at least twice per month, typically bringing with him on the plane $400,000 to $500,000 in cash.  Tankson often purchased 100 to 200 pounds of marijuana at a time, with the drugs being shipped on vans and tractor trailers to stash houses in Chicago, according to the plea agreement.  One of the stash houses was located in the Lincoln Park neighborhood of Chicago, while another was set up in a penthouse apartment in the city’s River West neighborhood.

Tankson, 32, of Evanston, pleaded guilty to one count of conspiracy to possess a controlled substance with the intent to deliver, and one count of conspiracy to commit money laundering.  The conviction carries a maximum sentence of 40 years in prison and a maximum fine of $1.5 million.

U.S. District Judge Matthew F. Kennelly scheduled a sentencing hearing for August 25, 2016, at 1:30 p.m.

According to the plea agreement, Tankson used drug proceeds to purchase several luxury automobiles through straw purchasers.  Between June 2011 and December 2013, Tankson orchestrated the purchases of a Porsche Cayenne sport utility vehicle for $140,000, a Mercedes-Benz S63 sedan for $108,000, an Audi A8 sedan for $80,000, and several other expensive vehicles, according to the plea agreement.  Tankson acknowledged in the plea agreement that the auto transactions were intended to conceal the source of the drug proceeds.

Tankson was arrested in December 2013.  During a search of his Lincoln Park stash house, law enforcement discovered more than $1 million in cash, approximately 75 kilograms of cannabis stuffed into numerous plastic bags, five suitcases filled with cannabis, 20 rounds of 9mm ammunition and two 9mm pistol magazines, according to a federal criminal complaint filed against him in January 2014. 

Investigators thereafter began an extensive money laundering investigation that led to charges against two other defendants.  An alleged straw buyer of the vehicles, SONGHANE TRAORE, of Chicago, is charged with one count of conspiracy to possess a controlled substance with the intent to deliver, one count of conspiracy to commit money laundering, and one count of money laundering.  JEROME B. MARSHALL, of Chicago, is charged with one count of money laundering for allegedly helping Tankson to fraudulently lease the Lincoln Park apartment.

Traore and Marshall have pleaded not guilty to the charges.  Traore’s next court appearance before Judge Kennelly is scheduled for June 3, 2016, at 1:00 p.m., while Marshall will next appear before Judge Kennelly on June 13, 2016, at 10:00 a.m.

Tankson’s guilty plea was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Jeffery Magee, Special Agent in Charge of the Chicago Field Division of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives; James D. Robnett, Special Agent-in-Charge of the Chicago Office of the Internal Revenue Service Criminal Investigation Division; and Eddie T. Johnson, Chicago Police Superintendent.

The government is represented by Assistant U.S. Attorney Kartik K. Raman.

Plea Agreement

ROCKFORD — A Des Plaines man was sentenced today in federal court by U.S. District Judge Frederick J. Kapala for his role in a conspiracy to manufacture and distribute marijuana. 

JEREMIAH N. CLEMENT, 38, of Des Plaines, was sentenced to 10 years in federal prison, to be followed by 5 years of supervised release.  On Oct. 6, 2015, a federal grand jury in Rockford charged Clement and six other individuals, five men and a woman, with conspiring to manufacture, possess and distribute 1,000 or more marijuana plants.  The indictment alleges that between Jan. 2, 2013, and Jan. 6, 2015, the defendants conspired to illegally grow and store marijuana in a warehouse located at 1916 11th Street in Rockford.  The warehouse was destroyed by a fire on Jan. 6, 2015. 

Clement pleaded guilty to the charge on Dec. 18, 2015, admitting that he conspired to manufacture and distribute marijuana with co-defendants GEORGE H. BACUS, 52, of Niles, Ill.; YOUSIF Y. PIRA, 63, of Chicago, Ill.; JUSTIN T. PAGLUSCH, 34, of Ingleside, Ill.; SHLIMON SHIMON, 47, of Chicago, Ill.; CASEY WILLIAMS, 29, of Great Falls, Mont.; and DESTINY FREEMAN, 22, of Palmer, Alaska.  According to the written plea agreement, on Jan. 2, 2013, Bacus purchased the warehouse at 1916 11th Street in Rockford, Ill. on installment contract, using money provided by Shimon or an associate of Shimon.  Shimon, Bacus and Pira used the warehouse to illegally grow and harvest marijuana plants, then process the marijuana sale to others.  Between March and June of 2014, Shimon recruited Clement to join the conspiracy and participate in processing the initial crop.

Clement admitted in the plea agreement that in late July or early August of 2014, a new marijuana crop was planted.  On Sept. 12, 2014, at Shimon’s direction, Clement entered into a contract to purchase the warehouse, and the contract that Bacus had entered into was terminated.  Shimon provided the money to pay for the warehouse and the use of the warehouse was under Shimon’s control.  The plea agreement also states that Shimon retained Bacus to monitor Clement’s activities at the warehouse and report to Shimon.

In addition, the plea agreement states that in August of 2014, Clement recruited Williams to join the conspirators, who in turn recruited Freeman.  Clement paid for Williams and Freeman to travel from Montana to Rockford, using money provided by Shimon.  With Shimon's permission, Clement allowed Williams and Freeman to live in the warehouse while they assisted in the marijuana growing operation, using money from Shimon to pay for food while they lived in the warehouse.  In December of 2014, Clement recruited Paglusch to join the conspiracy.

As further stated in the plea agreement, Shimon provided the plants, equipment and nutrients for growing the new marijuana crop.  Williams and Freeman watered and cared for the marijuana crop as it was growing, and Clement supervised them.  Shimon came to the warehouse for a few hours a day when he was in the area.  Clement, Shimon, Bacus, Williams, Freeman and Paglusch all participated in the processing of the new marijuana crop, which was stored in a vault at the warehouse, with the combination to the lock known by Shimon, but not Clement.  The initial marijuana crop and the new marijuana crop totaled more than 1,000 marijuana plants.  In addition, as stated in the plea agreement, during the period of the conspiracy, Shimon kept a revolver at the warehouse for protection, which Clement possessed from time to time.  At sentencing, Judge Kapala found as an aggravating factor that Clement intentionally set the fire that destroyed the warehouse located at 1916 11th Street on Jan. 6, 2015.

Freeman pleaded guilty on June 1, 2016, and remains free on her own recognizance pending sentencing set for Sept. 15, 2016, at 2:30 p.m.  Freeman faces a maximum sentence of 5 years' imprisonment, a term of supervised release following imprisonment of at least 2 years, and a maximum fine of $250,000.

Bacus and Pira were arrested in April 2015 and released pending trial.  Williams was arrested in October 2015 and is in federal custody pending trial.  Paglusch was arrested this morning in Wichita Falls, Tex., and an initial appearance is pending.  An arrest warrant was issued for Shimon, who is still at large. 

If convicted, the court must impose a reasonable sentence under federal sentencing statutes and the advisory United States Sentencing Guidelines.  The public is reminded that an indictment is only a charge and is not evidence of guilt.  Each defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

The sentencing today was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Jeffery A. Magee, Special Agent-in-Charge of the Chicago Field Division of the Bureau of Alcohol, Tobacco, Firearms & Explosives; Derek Bergsten, Chief of the Rockford Fire Department; and Anthony Scarpelli, Chief of the Skokie, Ill. Police Department.  The Winnebago County Sheriff’s Department Narcotics Unit and Rockford Police Department Narcotics Unit assisted in the investigation. 

The government is represented by Assistant U.S. Attorney Joseph C. Pedersen.

ROCKFORD — The former Winnebago County Purchasing Director pleaded guilty today before U.S. District Judge Frederick J. Kapala to two counts of theft from a program receiving federal funds.  SALLY A. CLAASSEN, 57, of Roscoe, Ill., was an employee of Winnebago County from March 3, 1997, until she resigned on Sept. 11, 2015.  Claassen’s job title prior to her resignation was Purchasing Director.

According to the written plea agreement, as Purchasing Director for Winnebago County, Claassen was responsible for receiving and reviewing invoices submitted by vendors and submitting payment to vendors.  As stated in the plea agreement, from Feb. 25, 2014 through April 27, 2015, Claassen used her position as the approver for payments from Winnebago County to vendors to steal approximately $368,137 from the County.  Claassen admitted that she accomplished this theft by asking two Winnebago County vendors to submit false invoices to Winnebago County for work that was not performed, which Claassen then paid with County funds.  Claassen then directed the two vendors to provide her with checks made out to “Cash” or to “JP Morgan Chase” for the full amounts that the vendors were paid.  As Claassen further admitted, she told the two vendors that she needed them to submit the false invoices and then provide her with the checks for the full amount of the payments to help her allocate Winnebago County money to a project being funded by a charitable organization.  In reality, Claassen stole the money by depositing the checks into her personal bank accounts.  One of the vendors provided Claassen with 5 checks that totaled $45,000.  The other vendor provided Claassen with 7 checks that totaled $323,137.  No money given to Claassen by either vendor was ever used for the purpose for which she told the vendors that it was to be used. 

As further stated in the plea agreement, in her position as Purchasing Director, Claassen  held a Winnebago County-issued credit card that she was authorized to use to make purchases for official County business.  Claassen was required to submit invoices and supporting documentation to the County to demonstrate that items purchased were for County business.  Claassen also had the ability to purchase items for Winnebago County by requesting that Winnebago County issue a check to a particular vendor.  Claassen was required to submit invoices and supporting documentation to Winnebago County to demonstrate that the requested check was to be used to purchase items for Winnebago County business.  Claassen admitted in the plea agreement that from April 15, 2014 to July 1, 2015, she used her Winnebago County-issued credit card and checks from Winnebago County to purchase items for her personal use, including home remodeling items and personal vacations.  Claassen admitted she primarily accomplished this by either using her Winnebago County-issued credit card to make personal purchases and then submitting false or altered supporting documentation so the County would pay for the charges, or modifying or creating false invoices and submitting them to Winnebago County so the County would issue a check for the purchase. 

According to the plea agreement, as an example of using the Winnebago County-issued credit card to accomplish the theft, on Jan. 29, 2015, Claassen used the credit card at a local vendor to purchase granite countertops for her kitchen in the amount of $6,109.  While the sales order for this purchase listed the customer as Claassen at her home address, on Feb. 12, 2015, Claassen submitted an altered version of the sales order to the County listing Winnebago County as the customer with an altered description of the items purchased.

Another example in the plea agreement was that on May 20, 2014, Claassen ordered approximately $13,214 worth of furniture for her home and gift cards from a vendor.  The sales order provided to Claassen noted that the customer was Claassen at her home address and listed various items of furniture that had been ordered.  On the same date, Claassen caused an employee in her department to submit a request for Winnebago County to issue a payment by check to that vendor in the amount of $13,125.  In the plea agreement, Claassen admitted that with the request she submitted an altered sales order from that vendor that listed Winnebago County as the customer with an altered description of the items purchased. 

In total, using these methods, it is the government’s position in the plea agreement that Claassen stole approximately $451,353 from Winnebago County in 2014 and 2015.  In the plea agreement, Claassen reserved the right to dispute this amount.  Claassen also agreed in the plea agreement to the entry of a forfeiture judgment to the United States all right, title, and interest that she has in any property constituting or derived from proceeds obtained, directly or indirectly and further agreed not to contest forfeiture of approximately $292,525 already seized by the United States. 

On each count Claassen faces a maximum sentence of up to 10 years’ imprisonment, a fine of up to $250,000, or twice the gross gain or gross loss resulting from that offense, whichever is greater, and full restitution.  In addition, Claassen faces a term of supervised release of up to 5 years following imprisonment.  Claassen remains free on her own recognizance pending sentencing, which U.S. District Judge Frederick J. Kapala set for September 13, 2016, at 9:30 a.m.

The guilty plea was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois, and Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.

The government is represented by Assistant U.S. Attorney Margaret J. Schneider.

Plea Agreement

ROCKFORD — A California man pleaded guilty today before U.S. District Judge Philip G. Reinhard to wire fraud.  According to the written plea agreement, TRAVIS OLIVER, 39, admitted to defrauding investors by making false representations regarding their investments in Electus Asset Holdings.

In the plea agreement, Oliver admitted that he was the sole managing member of Electus Asset Holdings, and that both he and his co-defendant, TODD C. SMITH, 48, of Rockford, engaged in a scheme between July 15, 2009, and March 2012, to defraud investors.  Oliver admitted that he falsely represented to potential investors that their investments would be returned in one year, yielding a guaranteed rate of interest per month, and that the funds could be withdrawn at any time without penalty.  Oliver further admitted that he knew a majority of the investors’ funds was used to pay for his own personal expenses and other items, including sales commissions paid to Oliver and Smith.

Oliver further admitted that in order to conceal his scheme and prevent the investors from demanding the return of their investments, he used funds from new investors to pay interest and principal to prior investors in Electus Asset Holdings and in a previous investment Oliver had offered.  Oliver admitted that he had mailed monthly statements and IRS forms to investors that falsely stated the investors had earned interest on their investments.

According to the plea agreement, when investors requested the return of their interest and principal, Oliver made false statements and promises to conceal the fact the investors’ money had been spent or lost in high risk investments, including that investors’ checks were going to be issued shortly, that their checks were lost in the mail, and that investors’ funds had been invested in a company whose assets had been frozen by the Federal Trade Commission.

Wire fraud carries a maximum penalty of 20 years in prison, and a maximum fine of $250,000 or twice the loss or twice the gain derived from the offense, whichever is greater.  Sentencing is set for September 19, 2016, at 9:00 a.m. 

The guilty plea was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of Federal Bureau of Investigation; and Antonio Gómez, Inspector-in-Charge of the U.S. Postal Inspection Service in Chicago.  The Illinois Secretary of State's Securities Department assisted in the investigation.

As to co-defendant Todd C. Smith, the public is reminded that an indictment contains only charges and is not evidence of guilt.  Smith is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

The government is represented by Assistant U.S. Attorney Joseph C. Pedersen.

ROCKFORD — Two Rockford, Ill. brothers were sentenced before U.S. District Judge Frederick J. Kapala on drug charges.  Today, TIERRE A. BAZZELLE, 39, who pleaded guilty on Dec. 16, 2015, to conspiracy to distribute cocaine, was sentenced to 127 months in federal prison, to be followed by four years’ supervised release. 

According to the written plea agreement, between Feb. 1, 2014 and May 6, 2014, Bazzelle conspired with his brother, co-defendant TALIB O. BAZZELLE, to distribute 500 grams or more of cocaine and cocaine base, commonly referred to as “crack.”  Between March 14, 2014 and May 6, 2014, Tierre Bazzelle purchased approximately 1,456 grams of cocaine that he sold to his customers.  Tierre Bazzelle provided a portion of the 1,456 grams of cocaine to Talib Bazzelle, and directed him to distribute it to Tierre Bazzelle’s customers.  Tierre Bazzelle also directed his brother to collect money owed to Tierre Bazzelle for cocaine provided to customers on credit.  Tierre Bazzelle also admitted that he converted a portion of the cocaine to “crack,” and provided Talib Bazzelle with a total of at least 168 grams of crack cocaine between Feb. 1, 2014 and May 6, 2014.  As stated in the plea agreement, on May 6, 2014, the two brothers met with an individual in a grocery parking lot in Rockford, then drove a short distance into a neighborhood where Tierre Bazzelle purchased cocaine.  After driving a short distance away, Tierre Bazzelle’s vehicle was stopped by law enforcement agents.  When the defendant was searched, a bag containing the 7.5 ounces of cocaine was located in his pants.

As further stated in the plea agreement, the defendant possessed a .45 caliber handgun that was found between the cushions of a couch in the living room of his residence.  The gun was loaded with 12 rounds of ammunition in the magazine and one round in the chamber, and a box of ammunition was also found hidden under a cushion of a love seat in the living room.  Other drug paraphernalia used to convert powder cocaine to crack, and package powder and crack cocaine were located in the home.

Talib Bazzelle, 34, pleaded guilty on Dec. 4, 2015, to possessing cocaine with intent to distribute.  He was sentenced on March 17, 2016, to 162 months in federal prison, to be followed by a period of three years of supervised release. 

The sentencing of Tierre Bazzelle was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; and Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of Federal Bureau of Investigation.  The case was a result of a joint investigation by the Winnebago County Sheriff’s Office Narcotics Unit and the FBI.

The government was represented by Assistant U.S. Attorney Joseph C. Pedersen.

ROCKFORD — The former Winnebago County Purchasing Director was charged yesterday in federal court on two counts of theft from a program receiving federal funds.  SALLY A. CLAASSEN, 57, of Roscoe, Ill., was an employee of Winnebago County from March 3, 1997, until she resigned on Sept. 11, 2015.  Claassen’s job title prior to her resignation was Purchasing Director.  

According to the information filed, Claassen was an agent of Winnebago County, a local government that received federal funding.  As Purchasing Director, Claassen was responsible for receiving and reviewing invoices submitted by vendors to Winnebago County and submitting payments to vendors.  The information alleges that Claassen held a Winnebago County-issued credit card that she was authorized to use to make purchases for official Winnebago County business.  Claassen was required to submit invoices and supporting documentation to Winnebago County to demonstrate that items purchased were for Winnebago County business.  The information alleges that Claassen also had the ability to purchase items for Winnebago County by requesting that Winnebago County issue a check to a particular vendor.  Claassen was required to submit invoices and supporting documentation to Winnebago County to demonstrate that the requested check was to be used to purchase items for Winnebago County business. 

The information alleges that for each of the periods of Feb. 24, 2014 through December 31, 2014, and Jan. 1, 2015 through July 1, 2015, Claassen embezzled or stole at least $5,000  from Winnebago County.

The information also seeks forfeiture of all property constituting, and derived from, and traceable to, proceeds obtained, directly or indirectly, as a result of defendant’s alleged violations including approximately $451,353, which includes approximately $292,525 in funds already seized by the United States.

Each count of theft from a program receiving federal funds carries a maximum sentence of up to 10 years’ imprisonment, a fine of up to $250,000, or twice the gross gain or gross loss resulting from that offense, whichever is greater, and full restitution, as well as a period of supervised release following imprisonment of up to 5 years.  Claassen remains free on her own recognizance pending an initial appearance and entry of plea set before U.S. District Judge Frederick J. Kapala on June 1, 2016, at 10:30 a.m.

The charges were announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois, and Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of Federal Bureau of Investigation.

The government is represented by Assistant U.S. Attorney Margaret J. Schneider.

Information

CHICAGO — An Indiana man has been convicted of unlawfully dealing firearms after purchasing guns from licensed dealers in Indiana and selling them to gang members on the West Side of Chicago.

In the fall of 2013 WILLIE LEE BILES JR. made multiple trips on a Megabus to Chicago from his home in Indianapolis, each time bringing with him a gym bag full of handguns.  Biles had legally purchased more than 30 firearms from licensed dealers in Indiana.

Once in Chicago, Biles would sit on the porch of a residence on the city’s West Side and sell firearms to individuals for two to three times the price that Biles had paid for them.  Biles never asked any of his customers for identification, and he failed to verify whether they could legally possess firearms.  At least one of his customers was a convicted felon who could not legally possess a firearm.

Seven of the firearms Biles sold were later recovered by law enforcement in the Chicagoland area.

The jury yesterday convicted Biles, 44, of willfully dealing firearms without a license.  The charge carries a maximum sentence of five years in prison and a fine of up to $250,000.  U.S. District Judge Sara L. Ellis scheduled a sentencing hearing for Nov. 16, 2016, at 10:30 a.m.

The convicted felon to whom Biles sold four guns was previously imprisoned in the case.  OTTO LEWELLEN, of Bellwood, pleaded guilty last year to one count of being a felon in possession of a firearm.  Lewellen admitted in a plea agreement that he purchased four firearms from Biles.  Authorities recovered two revolvers, but Lewellen said he sold the two other guns to a man he knew only as “Red.”  Officials have not been able to locate Red or the two guns.  Judge Ellis last year sentenced Lewellen to 18 months in prison.

The verdict was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; and Jeffery Magee, Special Agent in Charge of the Chicago Field Division of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives.  The investigation was conducted with the Chicago High Intensity Drug Trafficking Task Force (HIDTA).  Substantial assistance was provided by the Illinois State Police, Chicago Police Department, Bellwood Police Department and ATF Indianapolis Field Division.

The government is represented by Assistant U.S. Attorneys Christopher V. Parente and Elizabeth R. Pozolo.

CHICAGO — Civic, religious and community leaders joined top law enforcement personnel today to continue an ongoing dialogue about building trust between law enforcement and the Chicagoland community.

The Community Roundtable was convened by Zachary T. Fardon, United States Attorney for the Northern District of Illinois.  It was held at Kennedy-King College in the Englewood neighborhood on Chicago’s South Side.  Today’s event was the fourth such discussion, following up on productive sessions in December 2014, March 2015 and November 2015.

“Today’s roundtable brought together fervent leaders from various experiences and backgrounds,” said Mr. Fardon.  “We all share the collective goal of cultivating community trust and making Chicago an even stronger and safer place.  We had a candid and inspiring conversation about how to maximize the resources of the many talented service providers our city has to offer, and how to better incorporate law enforcement into their efforts to serve our most at-risk communities.”

Among the more than 50 participants in today’s meeting were Chicago Police Superintendent Eddie T. Johnson and other top members of the Chicago Police Department, as well as representatives from the Cook County State’s Attorney’s Office, U.S. Drug Enforcement Administration, Federal Bureau of Investigation, U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives, the Cook County Sheriff’s Department, Chicago Independent Police Review Authority, U.S. Marshal’s Service, KLEO Community Family Life Center, Chicago Board of Rabbis, Bowen High School, A Better Chicago, Purpose Over Pain, Chicago Community Trust, University of Chicago Crime Lab, YMCA, Mikva Challenge, Chicago Violence Reduction Strategy, YWCA Metropolitan Chicago, Chicago Urban League, Back of the Yards Neighborhood Council, Better Boys Foundation, Council of Islamic Organizations of Greater Chicago, and Becoming A Man.

The U.S. Department of Justice has made the issue of community policing a top priority.  The Community Roundtables focus on developing tangible initiatives for improving the relationship between law enforcement and the community.

Kennedy-King College, one of seven City Colleges of Chicago, is named after slain civil rights leaders Robert F. Kennedy and Dr. Martin Luther King Jr.  It is located at 6301 S. Halsted St. in Chicago.

ROCKFORD — A Poplar Grove, Ill. resident was indicted yesterday in federal court in Rockford on a charge of distributing 448 grams of methamphetamine, announced U.S. Attorney Zachary T. Fardon, Boone County Sheriff David Ernest, and Belvidere Police Chief Jan Noble.

According to the indictment, ARMAN M. DINO, 45, distributed the methamphetamine on May 19, 2016, in Poplar Grove.  A criminal complaint filed on May 19, 2016, stated that Dino sold the drugs at his residence in Candlewick Lake to an individual who was cooperating with the government.  After that sale, law enforcement agents executed a search warrant on Dino’s residence.  According to the complaint, additional methamphetamine, the original $10,000 in “buy money,” and more currency were found inside the residence.  According to the complaint, Dino was arrested that same day.

Dino appeared before United States Magistrate Judge Iain D. Johnston on May 23, 2016, in Rockford, and was ordered detained pending trial.  His arraignment on the indictment is set for May 26, 2016, at 11:00 a.m. before Magistrate Judge Johnston.  The charge carries a mandatory minimum sentence of 5 years and a maximum sentence of 40 years in prison. 

The multi-jurisdictional investigation was conducted by the Belvidere/Boone County Metro Narcotics Unit, along with agents from the Federal Bureau of Investigation and Drug Enforcement Administration and Rockford Police Department Detectives.  Assistant U.S. Attorneys Joseph C. Pedersen and John G. McKenzie are prosecuting the case.

The public is reminded that an indictment contains only a charge and is not evidence of guilt.  The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

Indictment

CHICAGO — An Ohio man was sentenced today to 22 years in federal prison for his role in a sex trafficking ring involving minor girls who were brought to Chicago from Iowa to engage in prostitution.

WILLIE WOODS, 46, of Toledo, Ohio, helped transport the minor girls from Iowa City in 2012.  Once in Chicago, Woods and his co-conspirators forced the girls to engage in prostitution.  At the time, one victim was 14 years old, one victim was 16 years old, and one victim was 17 years old.

A jury last year convicted Woods on one count of sex trafficking conspiracy; three counts of sex trafficking of minors by force, fraud or coercion; one count of transporting minors to engage in prostitution; and one count of obstruction of justice.

U.S. District Judge Sharon Johnson Coleman imposed the 264-month sentence in federal court in Chicago.

Woods “humiliated these girls, robbed them of their childhood and their innocence, and set them off on a path of self-destructive behavior,” Assistant U.S. Attorney Bethany K. Biesenthal argued in the government’s sentencing memorandum.  “The girls will never be able to fully recover from the pain defendant inflicted.”

Woods is one of three defendants convicted in the case.  MALIK MCKEE and his sister, SHUNTINA MCKEE, both of Iowa City, previously pleaded guilty to one count of sex trafficking conspiracy.  Judge Coleman in 2014 sentenced Malik McKee to 102 months in prison, plus restitution of $6,000.  Shuntina McKee is scheduled to be sentenced by Judge Coleman on May 31, 2016, at 9:30 a.m.

Evidence at Woods’ seven-day trial revealed that the defendants forced the minor girls to engage in prostitution in Iowa and Chicago.  The defendants took photographs of the minors and used them in advertisements on websites, including Backpage.com.  When individuals responded to the advertisement, the defendants arranged the meeting and then pocketed the proceeds.

The three minor girls testified at trial about their ordeals.  The girls described the defendants’ violent and abusive acts, which included using power and coercion to force the girls to perform sex acts for money.  One of the girls testified that Woods starved her by withholding food until she submitted to his demands to engage in prostitution.

The conviction was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Michael J. Anderson, Special Agent in Charge of the Chicago Office of the Federal Bureau of Investigation; and Eddie T. Johnson, Superintendent of the Chicago Police Department.  The FBI and Chicago Police conducted the investigation in coordination with the Cook County Human Trafficking Task Force.  Federal law enforcement authorities in the Southern District of Iowa and the Northern District of Ohio, as well as the Iowa State Police, assisted in the case.

The government is represented by Ms. Biesenthal and Assistant U.S. Attorney Megan Cunniff Church.

CHICAGO — Several suspects, including high-ranking members of a Chicago street gang, are facing drug or gun charges for their alleged roles in dealing narcotics and firearms on the city’s South Side.

The investigation, dubbed “Operation Cornerstone,” spanned more than two years and included seizures of distribution quantities of cocaine and heroin, as well as confiscations of firearms and cash proceeds from drug sales.  Authorities uncovered the criminal activity through the use of wiretapped cellular phones, cooperating witnesses, controlled purchases of narcotics and guns, and extensive surveillance.

Several suspects were arrested today without incident.  While attempting to arrest a suspect at a residence in Park Forest, two agents of the Federal Bureau of Investigation were wounded.  The agents survived the shooting and their injuries are not believed to be life threatening.  The suspect, MELVIN TORAN, 50, of Park Forest, was later found dead inside the home.  Toran was a high-ranking member of the Black P-Stone Nation street gang.  He was set to be charged in federal court with distributing heroin.

Several defendants will be charged in criminal complaints to be filed in federal court in Chicago.  One defendant will be charged in a complaint filed in state court.

In addition to Toran, the investigation revealed that a number of the suspects are ranking members of the Black P-Stone Nation.  One of them arranged for the sale of 225 grams of heroin for $15,700 on Nov. 6, 2015.  Unbeknownst to him, the buyer was cooperating with law enforcement and had surreptitiously recorded both the negotiation – in a restaurant in the Back of the Yards neighborhood – and the transaction itself in a residence in Englewood.

The investigation also uncovered a heroin and cocaine operation being run out of a South Side clothing store.  A source cooperating with law enforcement informed authorities that when picking up narcotics from the store, the normal practice was to purchase an item of clothing as a pretext.  When paying for the clothing at the checkout counter, the owner of the store or one of the employees would bag the item of clothing and also pass over an additional bag containing the narcotics.  In the summer of 2015, a cooperating source – working at the direction of investigators – purchased more than 1,000 grams of heroin from the store owner for $72,720.

In addition to the drug offenses, the investigation also involved a probe into federal gun violations.  On Feb. 23, 2015, a .380-caliber firearm and chrome magazine was sold by a suspect for $500 to an individual who was cooperating with law enforcement.  In a related case indicted last month, JAMES JONES, 41, of Chicago, was charged with being a felon in possession of a firearm.  Chicago Police officers arrested Jones after a traffic stop on Dec. 7, 2015.  In the backseat of Jones’ vehicle were an infant child and two loaded semiautomatic pistols hidden in a baby bag, according a complaint filed in December in Jones’ case.  Jones has pleaded not guilty and is being held without bond while awaiting trial.

The investigation was conducted by a joint gang task force of the FBI and Chicago Police Department.

The arrests were announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the FBI; Anita Alvarez, Cook County State’s Attorney; and Eddie T. Johnson, Superintendent of the Chicago Police Department.  The Park Forest Police Department provided assistance.

Assistant United States Attorneys Shoba Pillay, Sean J.B. Franzblau and Christine M. O’Neill will represent the government in the federal cases.  The Cook County State’s Attorney’s Office will prosecute the state case.

ROCKFORD — A suspended physician pleaded guilty today in federal court to charges of health care fraud.  CHARLES S. DEHANN, 61, of Belvidere, Ill., pleaded guilty before Judge Frederick J. Kapala to two counts of health care fraud in a scheme to defraud Medicare that included overbilling and billing Medicare for treatment of patients that were already deceased.

According to the written plea agreement, DeHaan, during the course of the scheme, was a physician licensed in Illinois, who between January 2009 and January 24, 2014, primarily billed Medicare for in-home patient visits and certifications for patients he deemed homebound.  DeHaan admitted in the plea agreement that he knew Medicare authorized payment for home visits and physician services only if those services were actually provided and were medically necessary because of disease, infirmity, or impairment.  The plea agreement further states that DeHaan billed Medicare for medical services purportedly provided to patients when he knew he did not provide any reimbursable medical service.  This included DeHaan billing Medicare at the highest reimbursement levels for routine, non-complex visits with new and established patients even though DeHaan knew the visit did not qualify for the highest levels of reimbursement, and billing Medicare for patients DeHaan never actually treated.  According to the plea agreement, some of the patients DeHaan billed at the highest reimbursement levels but did not actually see were deceased on the date of the alleged visit.

On each count DeHaan faces a maximum potential penalty of up to 10 years in prison, a term of supervised release of up to 3 years following imprisonment, and a fine of up to $250,000, or twice the gross gain or gross loss resulting from that offense, whichever is greater, as well as full restitution.  Sentencing for DeHaan is scheduled for Sept. 21, 2016, at 9:30 a.m. 

The guilty plea was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Michael Anderson, Special Agent-in-Charge of the Chicago Office of Federal Bureau of Investigation; and Lamont Pugh, III, Special Agent-in-Charge of the Chicago Regional Office of the U.S. Department of Health and Human Services Office of Inspector General.  The Illinois Department of Financial and Professional Regulation assisted in the investigation.

The government is represented by Assistant U.S. Attorneys Scott R. Paccagnini and Talia Bucci.

Plea Agreement

CHICAGO — The owner of Chicago financial firms defrauded dozens of clients out of more than $1.5 million by pocketing most of their money instead of investing it, according to federal criminal charges filed today.

Between 2010 and 2013, CLAYTON ANDREW COHN controlled Chicago-based Marketaction Inc., Marketaction Advisors LLC, and the hedge fund Marketaction Capital Management LLC.  During this period, Cohn told potential investors that his firms were thriving from particular trading strategies, and that it had stakes in numerous private equity investments, when in reality there was very little investment activity, according to a criminal information filed in U.S. District Court in Chicago.  During this time, Cohn made only minimal investments and instead misappropriated a large amount of his clients’ funds for his own personal benefit, the information states.  Approximately 37 investors sustained losses of more than $1.5 million, according to the information.

The information charges Cohn, 29, of Chicago, with one count of wire fraud.  An arraignment is scheduled for May 26, 2016, at 10:00 a.m., in federal court in Chicago.

According to the information, Cohn falsely represented to investors and prospective clients that redemption of their investments would be “simple” and “easy,” and would be available on a monthly basis.  Cohn also deceived investors by distributing account statements that falsely stated the value of investor accounts, the information states.

Cohn falsely maintained that Marketaction retained a “fund accountant” to calculate the value of the fund, and an “auditor” to annually inspect it, according to the information.  Cohn prepared and filed with the U.S. Securities and Exchange Commission false and misleading reports about his hedge fund, including how it was subject to annual audits, according to the information.

The information was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; and Michael J. Anderson, Special Agent-in-Charge of the Chicago office of the Federal Bureau of Investigation.

In August 2013 the SEC, which provided helpful information to the criminal investigation, filed a civil lawsuit against Cohn and Marketaction Advisors LLC.

Wire fraud carries a maximum penalty of 20 years in prison, restitution to be determined by the Court, and a fine of up to $250,000 or twice the gross gain or gross loss resulting from the offense, whichever is greater.

The public is reminded that an information contains only charges and is not evidence of guilt.  The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.  If convicted, the Court must impose a reasonable sentence under federal sentencing statutes and the advisory U.S. Sentencing Guidelines.

The government is represented by Assistant United States Attorney Daniel Gillogly.

Information

CHICAGO — The owner of a Schaumburg construction company intentionally underpaid his union-affiliated employees by more than $1.5 million while underfunding their pension and welfare funds by another $1 million, according to federal criminal charges filed today.

JOSEPH LAMPIGNANO, the co-owner of A Lamp Concrete Contractors Inc., assigned laborers to work on government-funded road construction projects without paying the union-negotiated wage rate, according to a criminal information filed in U.S. District Court in Chicago.  From approximately 2008 to 2013, Lampignano violated collectively bargained agreements with the laborers’ union by failing to pay the union wage rate to certain laborers, underpaying them by a total of more than $1.5 million, according to the information.

Over the same time period, Lampignano also submitted false reports to the unions’ pension and welfare funds that underreported the number of hours worked by certain laborers, thereby lowering the amount of contributions that A Lamp was required to make to the funds on behalf of its employees, according to the information.  The shortfall to the funds totaled more than $1 million, the information states.

The information charges Lampignano, 43, of Itasca, with one count of mail fraud.  The charge carries a maximum penalty of 20 years in prison.

The information also describes a scheme in which Lampignano and his superintendent, GIOVANNI “JOHN” TRAVERSA, induced employees to re-pay a portion of settlement proceeds they received from the company in resolution of a civil lawsuit.  In 2013 A Lamp paid a total of $545,357 to 24 employees to satisfy unpaid wages and resolve the suit brought by the union.  Subsequent to paying the settlement funds, Lampignano, Traversa and others used their positions of authority to induce certain laborers to pay some of the money back to the company, according to the information.  Several employees eventually kicked back a total of at least $64,000, the information states.

Traversa, 46, of Bartlett, is charged with one count of making false statements to the Federal Bureau of Investigation and the U.S. Department of Labor Office of Inspector General regarding the settlement kickbacks.  The charge is punishable by up to five years in prison.

Arraignments for Lampignano and Traversa in U.S. District Court in Chicago have not yet been scheduled.

The information was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the FBI; James Vanderberg, Special Agent-in-Charge of the Chicago Region of the Department of Labor’s Office of Inspector General, Office of Labor Racketeering and Fraud Investigations; Jeffrey A. Monhart, Regional Director of the Chicago Regional Office of the Department of Labor - Employee Benefits Security Administration; and Cook County Sheriff Thomas J. Dart.

The public is reminded that an information contains only charges and is not evidence of guilt.  The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.  If convicted, the Court must impose a reasonable sentence under federal sentencing statutes and the advisory U.S. Sentencing Guidelines.

The government is represented by Assistant United States Attorney Brian Havey.

Information

CHICAGO — The leader of a group of armed drug dealers who sold crack cocaine and heroin on Chicago’s West Side and western suburbs was sentenced today to 40 years in prison for trying to murder a federal informant who was assisting law enforcement.

TOBY JONES and his associates tried to kill the informant on two occasions in the spring of 2014 in retaliation for the informant’s cooperation with the U.S. Bureau of Alcohol, Tobacco, Firearms & Explosives.  In the first attempt, Toby Jones fired several shots through the front door of an apartment in the informant’s building in Oak Park.  The informant was not injured, but an innocent victim was wounded.  The second attempt occurred a week later, when Toby Jones’ older brother, KELSEY JONES, approached the informant’s car outside of the same building and fired several shots, wounding the informant and another occupant.  Both victims survived, as did the victim of the first shooting.

Toby Jones, 38, and Kelsey Jones, 39, both of Chicago, were convicted earlier this year of conspiring with each other in the attempted murder of the informant.  Toby Jones was convicted after a bench trial before U.S. District Judge Amy J. St. Eve, who also found him guilty of distributing cocaine and illegally possessing a firearm.  Kelsey Jones was found guilty after a jury trial.  The jury also convicted him on gun and drug charges.

Judge St. Eve today imposed the sentence on Toby Jones.  A sentencing date for Kelsey Jones has not yet been scheduled. 

“The south and west sides of Chicago are racked with armed drug dealers who terrorize the community with the violence and social decay that inevitably accompanies their pernicious trade,” Assistant U.S. Attorney Sean J.B. Franzblau argued in the government’s sentencing memorandum.  Attempting to murder a federal witness is “an effort to weaken the institutions and processes that maintain social order.”

Testimony at the Jones’ trial revealed that Toby Jones led a group of armed cocaine and heroin dealers.  In December 2013, a confidential informant introduced an undercover ATF agent to Toby Jones, and for the next several months the agent and the informant purchased crack cocaine from him.  During these meetings, Toby Jones negotiated to purchase from the undercover agent a firearm with a high-capacity magazine in exchange for crack cocaine. 

On March 26, 2014, Toby Jones sent one of his drug dealers, WESLEY FIELDS, to meet with the undercover agent and purchase the gun.  Fields was arrested by federal authorities shortly after he arrived at the meeting.  Toby Jones thereafter began a week-long effort to track down and murder the confidential informant who set up the deal, culminating in the shootings in Oak Park.

Fields, of Chicago, pleaded guilty last year to participating in a drug conspiracy and possessing a firearm.  He was sentenced last week to nine years and nine months in prison.

Today’s sentencing of Toby Jones was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; and Jeffery Magee, Special Agent in Charge of the Chicago Field Division of ATF.  The Oak Park Police Department assisted in the investigation.

The government is represented by Mr. Franzblau and Assistant U.S. Attorney Brian Hayes.

CHICAGO — A Naperville man has been arrested for allegedly forcing women to engage in commercial sex acts and brutally abusing them if they wouldn’t comply with his orders.

BENJAMIN BIANCOFIORI used the promise of financial security to entice women into performing commercial sex acts on his behalf, according to a criminal complaint filed in U.S. District Court in Chicago.  Biancofiori ran his sex-trafficking operation primarily out of his townhouse in Naperville, the complaint states.  The complaint alleges that Biancofiori often beat and punched the women, and that he arranged for one of his victims to be returned to him at gunpoint after she tried to run away.  Biancofiori kept a vast majority of the proceeds earned by the women, the complaint states.

Biancofiori, 36, was arrested Wednesday in Colorado.  The complaint charges him with one count of sex trafficking by means of force, fraud and coercion.  An initial appearance in federal court in Chicago has not yet been scheduled.

The complaint states that once Biancofiori enticed the victims to work for him, he would post their information in commercial sex advertisements on Backpage.com.  He then arranged for the women to travel to meet clients at various locations in the Chicago area, the complaint states.  Biancofiori recruited one of his victims through an online messaging service on Facebook, according to the complaint.

For the past several weeks Biancofiori has been traveling in the western U.S., according to the complaint.  Biancofiori allegedly advertised one of his victims on Backpage.com while in Phoenix and Denver in March.

The complaint was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Michael J. Anderson, Special Agent in Charge of the Chicago office of the Federal Bureau of Investigation; and James D. Robnett, Special Agent-in-Charge of the Chicago Office of the Internal Revenue Service Criminal Investigation Division.  Substantial assistance was provided by the U.S. Attorney’s Office for the District of Colorado, the Denver office of the FBI, the Carol Stream Police Department and the Naperville Police Department.

The sex trafficking charge carries a minimum sentence of 15 years in prison and a maximum sentence of life in prison.

The public is reminded that a complaint is not evidence of guilt.  The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.  If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines. 

The government is represented by Assistant U.S. Attorneys Abigail Peluso and Erika Csicsila.

CHICAGO — The owner of several Chinese restaurants in the Chicago area intentionally withheld state taxes by underreporting the receipts paid in cash, according to federal criminal charges filed today.

HU XIAOJUN, also known as “Tony Hu,” 48, of Chicago, is charged in a criminal information with one count of wire fraud and one count of money laundering.  An arraignment in U.S. District Court in Chicago has not yet been scheduled.

Hu owns and operates several restaurants in Chicago and the suburbs, including the eateries Lao Sze Chuan and Lao You Ju.  The charges allege that from January 2010 to September 2014, Hu intentionally withheld sales taxes from the Illinois Department of Revenue for receipts that customers paid in cash.  Although Hu collected or caused to be collected all of the daily receipts, he and others discarded most of the bills from the cash sales, according to the information.

A new total without most of the cash purchases was then calculated, and Hu fraudulently reported it to the State, according to the information.  Hu deposited the unreported cash into his personal bank account – and caused others to do the same – and used the money to pay personal expenses, the information states.

The charges were announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation; and James D. Robnett, Special Agent-in-Charge of the Chicago Office of the Internal Revenue Service Criminal Investigation Division.

The two counts in the information are punishable by a combined maximum sentence of 30 years in prison and a fine of up to $500,000 or twice the gross gain or gross loss resulting from that offense, whichever is greater.

The public is reminded that an information is not evidence of guilt.  The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.  If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines. 

The government is represented by Assistant U.S. Attorneys William Ridgway and Joel Hammerman.

Information

CHICAGO — The head of a violent street gang that terrorized the West Side of Chicago through murder and drug trafficking was sentenced today to life in prison.

While leading the Imperial Insane Vice Lords, NATHANIEL HOSKINS ordered at least one murder and oversaw the operation of an open-air drug market near Humboldt Park in Chicago.  Hoskins assigned roles for each member of the gang to play in the drug market, and he personally handled the purchases of heroin and cocaine that fueled it. 

More than 30 individuals with alleged ties to the Imperial Insane Vice Lords have been arrested and charged as part of the investigation, and authorities shut down the open-air market.

Hoskins, 47, of Chicago, was convicted in a bench trial last year of participating in drug and murder conspiracies, and leading a racketeering enterprise.  U.S. District Judge Elaine E. Bucklo imposed the life sentence in federal court in Chicago.

“Gang-related violence is a tremendous problem in Chicago,” Assistant U.S. Attorney Rajnath P. Laud argued in the government’s sentencing memorandum.  “A sentence of life is the only sentence that reflects the seriousness of the offense, particularly given defendant’s leadership role and the other serious crimes he committed as leader of a violent street gang.”

Evidence at trial revealed that Hoskins made it clear to others that he was the king of the gang.  He ordered his subordinate gang members to commit violence to strengthen the group’s control over West Side neighborhoods.  One such order from Hoskins resulted in the killing of a man whom Hoskins believed was a rival gang member.

The sentencing was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Dennis A. Wichern, Special Agent-in-Charge of the Chicago Field Division of the Drug Enforcement Administration; Eddie Johnson, Chicago Police Superintendent; James D. Robnett, Special Agent-in-Charge of the Chicago Office of the Internal Revenue Service Criminal Investigation Division; and Cook County State’s Attorney Anita Alvarez.

The investigation was conducted through the U.S. Organized Crime Drug Enforcement Task Force (OCDETF) Chicago Strike Force, which ― in addition to the DEA, IRS-CID and CPD narcotics officers ― consists of U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI), the Federal Bureau of Investigation, the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives, the U.S. Marshals Service, and task force officers from various state and local law enforcement agencies, including the Cook County Sheriff’s Police and the Illinois State Police.

The government is represented by Mr. Laud and Assistant U.S. Attorneys Scott M. Edenfield and Sean Franzblau.

CHICAGO — A federal jury today convicted a north suburban attorney of submitting false information to immigration authorities to help his clients seek asylum in the United States.

ROBERT DEKELAITA accepted fees from foreign nationals in exchange for submitting the false documents to the U.S. Department of Homeland Security’s Citizenship and Immigration Services.  DeKelaita’s fraudulent statements often falsely portrayed his clients as victims of persecution by religious extremists in the Middle East.

DeKelaita, 53, of Glenview, was convicted on one count of conspiracy to commit asylum fraud, two counts of knowingly offering false statements in an asylum application, and one count of procuring perjury during asylum interviews.  The conviction is punishable by a maximum sentence of 35 years in prison.

U.S. District Judge Matthew F. Kennelly scheduled a sentencing hearing for Aug. 3, 2016, at 1:30 p.m.

Asylum is a benefit the U.S. government extends to immigrants who have suffered persecution in their native country or who fear future persecution on account of race, religion, nationality, membership in a particular social group, or political opinion.  To apply for asylum, the immigrant must submit an application detailing his or her personal history and provide a specific account of the alleged persecution. The application is signed by the immigrant, the immigrant’s attorney, and, if translation services were provided, the interpreter.  An interview is then held before immigration authorities, with all of the signors present.  A grant of asylum confers numerous benefits upon the immigrant, including eligibility to apply for permanent residency status.

DeKelaita is a licensed attorney whose Morton Grove firm, R.W. DeKelaita & Associates LLC, specializes in immigration law.  Evidence at trial revealed that from approximately 2000 to 2011, DeKelaita prepared and submitted asylum applications that contained material lies, including tales of rape, murder, torture, kidnappings, bombings and other forms of religious oppression in the Middle East.  As a result, several of DeKelaita’s clients were granted asylum and eventually permanent residency and citizenship status.

Two interpreters who provided Arabic and Assyrian translations for DeKelaita’s clients were also charged in the scheme.  ADAM BENJAMIN, of Skokie, pleaded guilty last year to one count of conspiracy to commit asylum fraud.  Benjamin admitted in a plea agreement that he instructed DeKelaita’s clients to present false stories of persecution in order to secure asylum.  Benjamin was sentenced in July 2015 to six months in prison.  YOUSIF YOUSIF, of Skokie, has pleaded not guilty to immigration fraud charges and is scheduled for trial on Aug. 29, 2016, before Judge Kennelly.

DeKelaita’s conviction was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Armando Lopez, Special Agent-in-Charge of the Homeland Security Office of Inspector General in Chicago; and Michael J. Anderson, Special Agent in Charge of the Chicago Office of the Federal Bureau of Investigation.  Assisting in the investigation were Homeland Security’s U.S. Citizenship and Immigration Services; Homeland Security’s U.S. Customs and Border Protection; U.S. Immigration and Customs Enforcement’s Homeland Security Investigations; and the Farmington Hills, Mich., Police Department.

The government is represented by Assistant U.S. Attorneys Lindsay Jenkins and Andrianna Kastanek.

CHICAGO — A Park Forest man has been convicted in federal court of leading a crew of armed robbers that targeted cellular telephone stores in the Chicago suburbs.

ERIC CURTIS recruited several individuals to join the crew and armed them with firearms to carry out the robberies.  The crew stole hundreds of cell phones while terrorizing store employees and customers at gunpoint.  After the robberies, Curtis helped sell the phones and divided the profits among the thieves.

The robberies occurred in 2013 in cell phone stores in the Chicago suburbs of Addison, Norridge, Deerfield and Woodridge.

After a nearly two-week trial in federal court in Chicago, the jury yesterday convicted Curtis, 31, on one count of conspiracy to commit robbery, three counts of robbery, one count of being a felon in possession of a firearm, and three counts of using a firearm in a crime of violence.  The conviction is punishable by a mandatory minimum sentence of 57 years in a prison, and a maximum sentence of life in prison.

U.S. District Judge Charles P. Kocoras scheduled a sentencing hearing for Aug. 4, 2016, at 9:45 a.m.

Evidence at trial revealed that Curtis’ crew conducted takeover-style robberies.  Crew members would enter a store, brandish firearms and order employees and customers to the back of the store.  The robbers would take as many cell phones as they could stuff into their duffel bags.

Seven other members of the crew previously pleaded guilty and are awaiting sentencing.  The prior convictions include another top leader, ERIC ROGERS of Hazel Crest.  Rogers admitted in a plea agreement that the crew also robbed cell phone stores in Joliet and downstate East Peoria, as well as a store in La Porte, Ind.

Curtis’ conviction was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; and Michael J. Anderson, Special Agent in Charge of the Chicago Office of the Federal Bureau of Investigation.  The police departments from Woodridge, Deerfield, Joliet, Norridge and East Peoria provided substantial assistance in the investigation.

The government is represented by Assistant United States Attorneys Christopher V. Parente and Allison A. Ray.

CHICAGO — A Chicago-based financial advisor pleaded guilty in federal court today to pocketing her clients’ money after counseling them to purchase phony securities.

DELORES J. MOSIER admitted in a plea agreement that she advised her clients to invest in bogus debt securities purportedly called “Chicago Anticipatory Notes.”  Mosier falsely represented that the notes were issued by the City of Chicago and would earn annual interest of 7% or higher, according to the plea agreement.  The securities did not exist, and Mosier pocketed the investment money, the plea agreement states.  The government contends that Mosier fraudulently obtained more than $4.2 million from approximately nine victims.

Mosier, 72, of La Porte, Ind., pleaded guilty to one count of mail fraud.  The conviction carries a maximum sentence of 20 years in prison and a maximum fine of $250,000 or twice the gross gain or gross loss resulting from the offense, whichever is greater.

U.S. District Judge Gary Feinerman scheduled a sentencing hearing for Aug. 12, 2016, at 9:30 a.m.      

Mosier is a licensed financial broker and investor who operated Chicago-based D.J. Mosier and Associates Inc.  According to the plea agreement, Mosier told her clients to make their investment checks payable to “Chicago Anticipatory Note,” knowing that she had opened a bank account in her name that was titled “CAN.”  Mosier deposited the clients’ checks into the account and used the money for her own benefit, including purchasing household expenses and making mortgage payments on a property in La Porte, Ind., according to the plea agreement.

Mosier concealed the scheme by using some of the money to make purported interest payments to other victims who had also purchased the fictitious notes.  She attempted to make the scam appear legitimate by providing the victims with fraudulent documents that she created, including fictitious disclosure statements, phony quarterly interest statements, and bogus balance statements that purported to reflect the clients’ growing investment proceeds.

The guilty plea was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; and Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.

The government is represented by Assistant U.S. Attorney Yusef Dale.

CHICAGO — A Joliet man was charged with arson today for allegedly causing a fire that destroyed his employer’s furniture distribution center in west suburban Woodridge.

RUBEN ANTONIO OCHOA CRUZ, a high lift operator in the warehouse, used a Bic lighter to spark the fire on April 21, 2016, according to a criminal complaint filed in U.S. District Court in Chicago.  He set the fire after meeting with his supervisors regarding an issue with his attendance at work, according to the complaint.  Approximately 65 employees were working at the warehouse at the time of the fire, and all of them escaped safely. 

The complaint charges Cruz, 20, with one count of arson.  He made an initial appearance today before U.S. Magistrate Judge Maria Valdez and was ordered held in federal custody.  A detention hearing was scheduled for May 4, 2016, at 11:00 a.m.

According to the complaint, firefighters from approximately 30 departments worked for seven hours to extinguish the blaze, which caused millions of dollars in damage.  The distribution center was burned to the ground, the complaint states.  No firefighters were injured.

The arson charge carries a minimum sentence of five years in prison and a maximum sentence of 20 years.

The complaint was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; and Jeffery Magee, Special Agent in Charge of the Chicago Field Division of ATF.  The officials praised the bravery of the firefighters who worked tirelessly to extinguish the blaze.

The Woodridge Police Department, Lemont Police Department and the Office of the Illinois State Fire Marshal provided substantial assistance in the investigation.

The public is reminded that a complaint is not evidence of guilt.  The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.  If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines. 

The government is represented by Assistant U.S. Attorney Misty Wright.

CHICAGO ― A disbarred Illinois lawyer has been sentenced to more than four years in federal prison for her role in a mortgage fraud scheme that bilked lenders and vulnerable homeowners out of more than $725,000.

AVALON BETTS-GASTON contrived fraudulent real estate transactions to defraud homeowners and financial institutions.  She and a co-defendant, Dimona Ross, arranged for the submission of materially false information on mortgage loan documents in four Cook County real estate transactions worth more than $725,000. 

A federal jury last year convicted Betts-Gaston, 47, of Naperville, on two counts of wire fraud.  In addition to the 57-month prison term, U.S. District Judge Charles R. Norgle yesterday ordered Betts-Gaston to pay restitution in the amount of $239,550.48.

“This case demonstrates a sophisticated scheme to take advantage of the trust that mortgage lenders placed in the loan applications they received, and the trust that the homeowners placed in her,” Assistant U.S. Attorney Stephen Chahn Lee argued in the government’s sentencing memorandum.  “The homeowners believed that she was there to help them, and instead she put their homes and equity at risk.”

Betts-Gaston graduated from law school and was admitted to the Illinois bar in 2000.  Ross was a licensed real estate loan officer.  Together they founded IJCN Investments, which was based in Chicago Ridge and purportedly helped distressed homeowners refinance their homes to avoid foreclosure.

IJCN was involved in various Cook County real estate transactions, with Betts-Gaston handling the legal aspects and Ross obtaining the mortgages.  Evidence at trial revealed that instead of refinancing the homes, the defendants arranged for the properties to be sold to a straw buyer.  In doing so, the pair submitted false applications for mortgage loans, eradicated the homeowners’ legal rights in their properties, and obtained all of the homeowners’ equity.  Betts-Gaston and Ross received fees for the deals, and the straw buyers were paid thousands of dollars.

IJCN was dissolved in 2008, and Betts-Gaston was disbarred in 2012. 

Ross pleaded guilty to one count of wire fraud.  She is scheduled to be sentenced by Judge Norgle on May 11, 2016, at 10:00 a.m.

The sentencing was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; and Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.

The government is represented by Mr. Lee and Assistant U.S. Attorney Timothy Storino.

U.S. District Judge Thomas M. Durkin for the Northern District of Illinois today sentenced John Dennis Hastert, 74, of Plano, Illinois, to 15 months in federal prison.  Hastert pleaded guilty last year to one count of illegally structuring cash withdrawals in order to evade financial reporting requirements.

After the sentencing hearing, the U.S. Attorney’s Office for the Northern District of Illinois issued the following statement:

“With this case, the Office sought to hold Mr. Hastert accountable for the crimes he committed that could still be prosecuted: illegally structuring cash withdrawals and lying to the government about his motive for engaging in that activity.  All of us have been inspired by the strength and bravery of the victims and witnesses who came forward in the most challenging of circumstances.  As in all cases, the Office is dedicated to doing everything we can to help victims and their families seek justice.  It is our hope that the sentence imposed today will promote respect for the law.”

The sentencing was announced by U.S. Attorney Zachary T. Fardon for the Northern District of Illinois; Special Agent in Charge Michael J. Anderson of the Chicago Office of the Federal Bureau of Investigation; and Special Agent in Charge James D. Robnett of the Chicago Office of the Internal Revenue Service-Criminal Investigation Division.

The government is represented by Assistant U.S. Attorneys Steven A. Block and Diane MacArthur.

CHICAGO — U.S. District Judge Thomas M. Durkin today sentenced JOHN DENNIS HASTERT, 74, of Plano, to 15 months in federal prison.  Hastert pleaded guilty last year to one count of illegally structuring cash withdrawals in order to evade financial reporting requirements.

After the sentencing hearing, the United States Attorney’s Office for the Northern District of Illinois issued the following statement:

“With this case, the Office sought to hold Mr. Hastert accountable for the crimes he committed that could still be prosecuted: illegally structuring cash withdrawals and lying to the government about his motive for engaging in that activity.  All of us have been inspired by the strength and bravery of the victims and witnesses who came forward in the most challenging of circumstances.  As in all cases, the Office is dedicated to doing everything we can to help victims and their families seek justice.  It is our hope that the sentence imposed today will promote respect for the law.”

The sentencing was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation; and James D. Robnett, Special Agent-in-Charge of the Chicago Office of the Internal Revenue Service Criminal Investigation Division.

The government is represented by Assistant U.S. Attorneys Steven A. Block and Diane MacArthur.

CHICAGO — The treasurer of south suburban Sauk Village was arrested today for allegedly looting the village’s Police Pension Fund out of more than $21,000.

JAMES GRIEGEL, 71, of Sauk Village, is charged with embezzlement in a criminal complaint filed in U.S. District Court in Chicago.  Federal authorities arrested Griegel this morning.  He made an initial appearance today before U.S. Magistrate Judge Maria Valdez and was ordered released on a personal recognizance bond.

The complaint alleges that Griegel fraudulently issued pension fund checks to himself and forged the names of Sauk Village officials as signatories.  Griegel listed the names of conferences and seminars on the memorandum lines of the checks to falsely make the payments appear to have been business related, according to the complaint.  Griegel then cashed the checks and used the money for his own benefit, including making purchases at gas stations, rental car locations, restaurants and storage facilities, the complaint states.

Griegel worked as the village’s treasurer from May 2013 until January 2016, when he was suspended from the post.  He issued the checks over a ten-month period from April 2015 to January 2016, according to the complaint.

The embezzlement charge carries a maximum sentence of ten years in prison and a $250,000 fine, and restitution is mandatory.

The arrest was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation; and John F. Oleskowicz, Special Agent-in-Charge of the U.S. Department of Justice’s Office of the Inspector General, Chicago Field Office.

The public is reminded that a complaint is not evidence of guilt.  The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.  If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines. 

The government is represented by Assistant U.S. Attorney Sunil Harjani.

CHICAGO — A convicted felon from southwest suburban Hickory Hills was sentenced today to more than six years in federal prison for illegally possessing several firearms with obliterated serial numbers.

STEVEN RILEY, 24, sold a 20-gauge shotgun, two rifles and 40 rounds of assorted ammunition to an individual for $2,500 in November 2014.  Unbeknownst to Riley, the buyer was a confidential informant who was working at the direction of agents from the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives.  Riley had previously been convicted of two felonies prior to the gun sale.

Riley pleaded guilty last year to one count of illegal possession of a firearm by a convicted felon.  U.S. District Judge Virginia M. Kendall imposed the 75-month sentence in federal court in Chicago.

“Firearms and firearm-related violence have plagued the City of Chicago for years, and continue to do so,” Assistant U.S. Attorney Jordan Palmore argued in the government’s sentencing memorandum.  “Conduct like that of the defendant in this case only contributes to this ongoing violence.”

In addition to the shotgun and rifles, Riley admitted in a plea agreement that he sold other firearms and assorted ammunition to the informant from October 2014 to February 2015.  These additional sales netted Riley $3,600.  In March 2015, agents executing a search warrant at Riley’s home in Hickory Hills discovered two loaded semi-automatic pistols and various ammunition, according to the plea agreement.

The guilty plea was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; and Jeffery Magee, Special Agent in Charge of the Chicago Field Division of the Bureau of Alcohol, Tobacco, Firearms and Explosives.  The Hickory Hills Police Department assisted in the investigation.

The government is represented by Ms. Palmore and Assistant U.S. Attorney Elizabeth Pozolo.

CHICAGO — A Glenview man who was hired by the Cook County Circuit Court Clerk’s Office after loaning $15,000 to a company controlled by the Clerk’s husband pleaded guilty to a perjury charge today for lying during testimony before a federal grand jury.

SIVASUBRAMANI RAJARAM admitted in a plea agreement that in August 2014 he loaned $15,000 to Goat Masters Corp., whose president was the husband of the Cook County Circuit Court Clerk.  The following month, Rajaram was hired by the Clerk’s Office as a level four Senior Clerk, according to the plea agreement.  Rajaram had previously worked in the Clerk’s Office but had been living in India for several years.

On or about Oct. 1, 2015, Rajaram testified before a federal grand jury that was investigating possible criminal violations in connection with the purchasing of jobs and promotions within the Clerk’s Office.  During his testimony, Rajaram said he had not spoken to the Circuit Court Clerk after his 2014 hiring.  He also testified that he had spoken to another high-ranking employee of the Clerk’s Office only “three or four times” since returning to Chicago from India.  Rajaram admitted in the plea agreement that both statements were false. 

Rajaram, 48, of Glenview, pleaded guilty to one count of making a false declaration before a grand jury.  The charge is punishable by up to five years in prison and a maximum fine of $250,000.  U.S. District Judge John W. Darrah scheduled a sentencing hearing for Sept. 14, 2016, at 1:30 p.m.

The guilty plea was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Anita Alvarez, Cook County State’s Attorney; Patrick M. Blanchard, Cook County Inspector General; and Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.

The government is represented by Assistant United States Attorneys Heather McShain and Ankur Srivastava.

Plea Agreement

ROCKFORD — A former Evanston, Ill. man was sentenced Tuesday in federal court on a federal bank robbery charge. 

The defendant, CONRAD J. GONZALEZ, 48, was sentenced by U.S. District Judge Frederick J. Kapala to 234 months in federal prison, and ordered to serve 3 years of supervised release following his term of imprisonment. 

On January 7, 2016, following a three-day trial before Judge Kapala, Gonzalez was found guilty by a federal jury of robbing the First Federal Savings Bank, located at 701 1st Ave., in Rock Falls, Ill. on Oct. 30, 2013.

According to the indictment and evidence at trial, at approximately 1:00 p.m. on Oct. 30, 2013, Gonzalez entered First Federal wearing a baseball cap and Chicago Bears sweatshirt.   Gonzalez approached a bank teller and handed her a note demanding money.  When the teller attempted to retrieve the note from the counter, Gonzalez said, “That was a stupid thing to do,” and took the note back.  The teller then handed $1,870 to Gonzalez, who then walked out of the bank on foot.

The sentencing was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois, and Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of Federal Bureau of Investigation.  The Rock Falls and Sterling Police Departments assisted in the investigation.

The government was represented by Assistant U.S. Attorneys Joseph C. Pedersen and Monica V. Mallory.

CHICAGO — A federal jury has convicted the head of a Schaumburg home health company on fraud charges for scheming to bill Medicare for millions of dollars in unnecessary services. 

As the manager of Suburban Home Physicians, which did business as Doctor at Home, DIANA JOCELYN GUMILA directed employees to perform in-home visits with patients who were physically capable of leaving their residences and not in need of the in-home treatment.  Gumila also inflated the costs incurred by Medicare by directing employees to bill the treatment at the most complicated levels, even though the visits were typically routine and did not qualify for the elevated billing. 

After a two-week trial in federal court in Chicago, the jury Friday night convicted Gumila, 46, of Streamwood, on 21 counts of health care fraud and three counts of making false statements in a health care matter.  Each count of health care fraud is punishable by up to ten years in prison, while each false-statement count is punishable by up to five years in prison. 

U.S. District Judge Charles P. Kocoras scheduled a sentencing hearing for July 26, 2016, at 9:45 a.m.

GUMILA became the latest defendant convicted in the federal investigation of Doctor at Home.  The prior convictions include ALAN NEWMAN, a physician from Chicago, and JAMES ADEMIJU, a nurse from Matteson who operated two nursing agencies.  In a plea agreement, Newman admitted falsely certifying patients for nursing services even when he knew that the patients did not need such care.  Newman admitted causing approximately $2.6 million in losses to Medicare, according to his plea agreement.  Ademiju pleaded guilty to making illegal payments for patient referrals, and he acknowledged billing for services that were improperly authorized by physicians from Doctor at Home.

Evidence presented at Gumila’s trial included a surreptitious audio recording in which Gumila can be heard telling a new doctor to “paint the picture” of patients so as to make them appear confined to their homes.  Emails from Gumila were also shown to the jury, including one in which she referred to a physician who did not read orders before signing them as “the type of doctor we need [b]ecause he will just do what we tell him to do.”

Gumila’s conviction was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Lamont Pugh III, Special Agent-in-Charge of the Chicago Region of the U.S. Department of Health and Human Services Office of Inspector General; Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation; and Joseph Del Favero, Deputy Assistant Inspector General for Investigations of the Railroad Retirement Board Office of the Inspector General.

The investigation was carried out by the Medicare Fraud Strike Force, which is part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative between the U.S. Justice Department and the U.S. Department of Health and Human Services to prevent fraud and to enforce anti-fraud laws around the country.  Dozens of defendants have been charged in numerous fraud cases since the strike force began operating in Chicago in 2011.

The government is represented by Assistant U.S. Attorneys Stephen Chahn Lee and Vikas Didwania.

CHICAGO — Federal authorities today announced criminal charges against four Chicago-area residents for a variety of alleged income tax frauds.  With tax season in full swing, the prosecutions serve as a warning to avoid dishonest tax-return preparers, and to remind taxpayers that each individual is responsible for the contents of his or her own return.

Two Chicago-area tax preparers were charged with assisting clients in obtaining hundreds of thousands of dollars in fraudulent refunds.   The preparers fraudulently reduced their clients’ tax liabilities by misrepresenting their eligibility to claim tax credits, such as dependent exemptions, education and child credits.

In addition, two individuals were indicted for filing hundreds of fraudulent income tax returns that claimed refunds totaling more than $2.1 million.  The fraudulent returns were filed electronically with the Internal Revenue Service.

“Tax preparers and individuals who willfully file false returns will be held accountable,” said Zachary T. Fardon, United States Attorney for the Northern District of Illinois.  “Although tax prosecutions occur throughout the year, it is especially important with Tax Day looming to remind the public of the importance of proper compliance with their tax obligations.” 

“IRS Criminal Investigation is committed to ensuring that honest taxpayers are not cheated and that all taxpayers pay their fair share,” said James D. Robnett, Special Agent-in-Charge of the IRS Criminal Investigation Division in Chicago.  “With the filing deadline approaching, individuals who might be thinking about cheating should think twice or they will risk the consequences.”

According to statistics available from the Treasury Inspector General for Tax Administration, U.S. taxpayers filed approximately 150 million returns in 2014.  The IRS found that more than 2.1 million of those returns claimed fraudulent refunds totaling more than $15.7 billion.

In addition to criminal penalties, including incarceration, fines and the costs of prosecution, convicted defendants remain responsible for all taxes and interest due, as well as civil penalties, U.S. Attorney Fardon noted.  Individuals making false claims against the government may be required to pay restitution and could be sued civilly for an amount greater than the fraudulent claims, he added.

In one of the prosecutions announced today, TAMITHA BROWN, 50, of Bolingbrook, was charged with preparing and filing false and fraudulent income tax returns.  Brown, a tax preparer who owned Bolingbrook-based E&T Tax Services Inc., filed the returns for the years 2008 through 2012, resulting in tax losses of approximately $189,856, according to the indictment.  The government in Brown’s case is represented by Assistant U.S. Attorneys Jeannice Appenteng and Cornelius Vandenberg.

Another tax preparer, BARBARA GARRETT, who co-owned Chicago-based Preferred Financial, was charged with filing seven individual income tax returns that she knew contained false and fraudulent information.  Garrett, 45, of Chicago, filed the returns on behalf of various taxpayers for the tax year 2009.  The false information included invalid business losses and education credits, according to the indictment.  The government in Garrett’s case is represented by Assistant U.S. Attorney Sean Driscoll.

Two individuals, TANYEA MACK and KATRINA WALLS, were charged with filing hundreds of fraudulent individual income tax returns.  Mack, 40, of Waukegan, filed approximately 232 false returns in the names of various individuals, claiming refunds totaling more than $1.15 million, according to the indictment.  Walls, 41, of Chicago, filed approximately 177 false returns in the names of various individuals, claiming refunds totaling $983,798, according to the indictment.  Assistant U.S. Attorney Derek Owens represents the government in the Mack and Walls cases.

The public is reminded that an indictment is not evidence of guilt.  The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.  If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.

For tips and guidelines to assist taxpayers in choosing a reputable tax professional and for preparing their own taxes, visit the official IRS website by logging on to: https://www.irs.gov/uac/Choose-Your-Tax-Preparer-Wisely.

CHICAGO — A former police officer in the Cook County Sheriff’s Department was sentenced today to 7 1/2 years in federal prison for robbing drug dealers of cocaine, marijuana and contraband cigarettes while on duty.

ROBERT VAUGHAN admitted in a plea agreement that he robbed eight drug dealers from 2011 to 2013, earning a total profit of $300,000.  Vaughan conducted the robberies with two other law enforcement officers, and the trio shared in the profits, according to the plea agreement.  The robberies were carried out in Chicago, Cicero, Plainfield, Lyons, Melrose Park and Forest Park.

Vaughan, 45, of Frankfort, pleaded guilty last year to one count of robbery.  U.S. District Judge Samuel Der-Yeghiayan imposed the 90-month sentence in federal court in Chicago.

“This is the type of crime one would expect to only see on a television show,” Assistant U.S. Attorney Sunil Harjani argued in the government’s sentencing memorandum.  “The crimes were brazen, arrogant and detrimental to the citizens of this district.  While the victims of the offense in this case garner no sympathy – they are drug dealers and contraband traffickers – it cannot excuse the outrageous conduct by Vaughan, who committed robberies using his badge and gun.”

According to the plea agreement, Vaughan was assigned to the High Intensity Drug Trafficking Area (HIDTA) team, a joint federal, state and local initiative to combat the trafficking of illegal narcotics.  Vaughan admitted using his position as a police officer to orchestrate deals with drug traffickers for marijuana, cocaine and contraband cigarettes.  Immediately after the transactions, Vaughan would arrest and handcuff the individuals – but then keep the narcotics for himself and release the dealers without charges.  Vaughan later sold the narcotics to other dealers in exchange for cash. 

Vaughan also robbed individuals and homes of marijuana based on information he had learned from confidential informants.  He was arrested on Nov. 3, 2014, after he and another law enforcement officer robbed 70 pounds of marijuana from an individual whom they believed was a drug courier.  Unbeknownst to the officers, the individual was an undercover federal agent, according to the plea agreement.

The sentencing was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; and Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.

The government is represented by Mr. Harjani.

A Chicago couple was charged in an indictment with a scheme to use their health care business to defraud Medicare out of millions of dollars, while also conspiring to employ a woman against her will.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Zachary T. Fardon of the Northern District of Illinois, Special Agent in Charge Michael J. Anderson of the FBI’s Chicago Division, Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Chicago Regional Office, Special Agent in Charge James D. Robnett of the Internal Revenue Service-Criminal Investigation (IRS-CI) Chicago Field Office, Acting Special Agent in Charge James M. Gibbons of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI) Chicago Field Office, Special Agent in Charge James Vanderberg of the U.S. Department of Labor’s Office of Inspector General-Office of Labor Racketeering and Fraud Investigations Chicago Region and Cook County State’s Attorney Anita Alvarez made the announcement.

Richard Tinimbang, 38, and his wife, Maribel Tinimbang, 40, both of Chicago, were charged with participating in a $45 million fraud scheme involving three Lincolnwood, Illinois, based home health care companies owned by Richard Tinimbang’s mother, Josephine Tinimbang.  The companies allegedly paid bribes and kickbacks to obtain Medicare beneficiaries, ignored doctors who refused to certify beneficiaries as being in need of home health care and falsified medical records to make patients appear sicker than they actually were. 

This indictment is part of a larger health care fraud investigation in which 13 others have been charged.  Three defendants have pleaded guilty and await sentencing; the 10 others, including Josephine Tinimbang, are awaiting trial.  Richard and Maribel Tinimbang’s business, Patients First Physical Therapy Inc., purportedly provided in-home therapy services to patients of three home health care companies – Donnarich Home Health Care Inc., Josdan Home Health Care Inc. and Pathways Home Health Services LLC.  According to the indictment, several individuals who worked at Donnarich, Josdan and Pathways conspired to commit health care fraud and laundered money to conceal the scheme.  From 2008 through 2014, the scheme resulted in $45 million in losses to Medicare, according to the indictment.   

Richard Tinimbang also allegedly submitted fraudulent forms to the U.S. Department of Homeland Security in order to allow a Filipino woman to legally work in the United States, stating that the woman would be hired as a business analyst at Josdan, thus qualifying her for an H-1B visa.  However, according to the indictment, when the woman arrived in the United States, Richard Tinimbang put her to work full time as a nanny and housekeeper for him, his wife and others.  The couple allegedly attempted to induce the woman to sign a servitude contract that provided for payment of $66 per day – regardless of the number of hours worked – for a term of seven years.  According to allegations in the indictment, the contract further provided that if the woman quit before the seventh year, she would be required to pay $25,000 in damages.  The couple allegedly threatened to send her back to the Philippines without being paid for the work she had already performed in order to force her to sign the contract and surrender her passport.

The couple and Josephine Tinimbang used proceeds from the fraud to make numerous personal purchases, including shares of stock, vehicles, real estate and jewelry, according to the indictment.  The indictment alleges that the couple concealed the money they had pocketed by falsely making it appear to be business expenses.

Richard Tinimbang is charged with one count of conspiracy to defraud Medicare, one count of conspiracy to pay or receive health care kickbacks, two counts of paying kickbacks to induce referrals of Medicare beneficiaries, one count of money laundering conspiracy, one count of conspiracy to obtain forced labor and one count of presenting false statements in an immigration document.  Maribel Tinimbang is charged with one count of conspiracy to defraud Medicare, one count of money laundering conspiracy and one count of conspiracy to obtain forced labor.

An indictment is merely a charge and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

The Medicare Fraud Strike Force and the Cook County Human Trafficking Task Force investigated the case.  Trial Attorney Brooke Harper of the Criminal Division’s Fraud Section is prosecuting the case. 

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged over 2,300 defendants who collectively have billed the Medicare program for over $7 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov.            

CHICAGO — A Chicago couple used their health care business to bilk Medicare out of millions of dollars while also conspiring to force a housekeeper to work against her will, according to an indictment returned in federal court in Chicago.

RICHARD TINIMBANG and his wife, MARIBEL TINIMBANG, participated in a $45 million fraud scheme involving three Lincolnwood-based home health care companies owned by Richard Tinimbang’s mother, according to the indictment.  The companies paid bribes and kickbacks to obtain Medicare beneficiaries, ignored doctors who refused to certify beneficiaries as being in need of home health care, and falsified medical records to make patients appear sicker than they actually were, the indictment states.  The couple and Richard Tinimbang’s mother, JOSEPHINE TINIMBANG, allegedly used proceeds from the fraud to make numerous personal purchases, including shares of stock, vehicles, real estate, and jewelry.

Richard Tinimbang, 38, of Chicago, is charged with one count of conspiracy to defraud Medicare, one count of conspiracy to pay or receive health care kickbacks, two counts of paying kickbacks to induce referrals of Medicare beneficiaries, one count of money laundering conspiracy, one count of conspiracy to obtain forced labor, and one count of presenting false statements in an immigration document. 

Maribel Tinimbang, 40, of Chicago, is charged with one count of conspiracy to defraud Medicare, one count of money laundering conspiracy, and one count of conspiracy to obtain forced labor.

An arraignment date has not yet been set.

The charges against Richard and Maribel Tinimbang are contained in a third superseding indictment returned last week in U.S. District Court in Chicago.  The case is part of a larger health care fraud investigation that previously resulted in charges against 13 others.  Three defendants have pleaded guilty and are awaiting sentencing, while the other ten, including Josephine Tinimbang, are awaiting trial.  The investigation found that several individuals who worked at three related home health care companies – Donnarich Home Health Care Inc., Josdan Home Health Care Inc., and Pathways Home Health Services LLC – conspired to commit health care fraud and laundered money to conceal the scheme.  The fraud started in 2008 and continued into 2014, resulting in a loss to Medicare of $45 million, according to the indictment.

Richard and Maribel Tinimbang’s business, Patients First Physical Therapy Inc., purported to provide in-home therapy services to patients of the three companies.  The indictment states the couple concealed the money they had pocketed by falsely making it appear to be business expenses, then used it to purchase personal items, including a 5,000-square-foot residence in Lincolnwood.

In addition to the health care fraud charges, Richard Tinimbang is accused of submitting fraudulent forms to the U.S. Department of Homeland Security to allow a Filipino woman to legally work in the United States.  Richard Tinimbang stated in the form that the woman would be hired as a business analyst at Josdan, thus qualifying her for an H-1B visa.  When the woman arrived in the United States, Richard Tinimbang put her to work full time as a nanny and housekeeper for him, his wife and others, the indictment states. 

The couple allegedly attempted to induce the woman to sign a servitude contract that provided for payment of $66 per day – regardless of the number of hours worked – for a term of seven years.  The contract further provided that if the woman quit before the seventh year, she would be required to pay $25,000 in damages, the indictment states.  To force the woman to surrender her passport and sign the contract, the couple threatened to send her back to the Philippines without being paid for the work she had already performed, according to the indictment.

The indictment was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division; Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation; Lamont Pugh III, Special Agent-in- Charge of the Chicago Regional Office of the U.S. Department of Health and Human Services Office of Inspector General; James D. Robnett, Special Agent-in-Charge of the IRS Criminal Investigation Division in Chicago; James M. Gibbons, Acting Special Agent-in-Charge of the Chicago Office of the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); James Vanderberg, Special Agent-in-Charge of the Chicago Region of the U.S. Department of Labor’s Office of Inspector General, Office of Labor Racketeering and Fraud Investigations; and Cook County State’s Attorney Anita Alvarez.

The investigation was carried out by the Medicare Fraud Strike Force, which consists of agents from the FBI and the U.S. Department of Health and Human Services, and prosecutors from the U.S. Attorney’s Office and the Justice Department’s Fraud Section.  The strike force is part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative between the Justice Department and HHS to prevent fraud and enforce anti-fraud laws around the country.

The case was also investigated by the Cook County Human Trafficking Task Force, a multi-disciplinary unit that brings law enforcement agencies together to work on human trafficking cases.

The public is reminded that an indictment is not evidence of guilt.  The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.  If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.

The government is represented by Trial Attorney Brooke Harper of the Justice Department’s Criminal Division Fraud Section. 

To report healthcare fraud or to learn more about it, logon to: StopMedicareFraud.gov.

Indictment

CHICAGO — A building inspector for the City of Chicago was arrested today for allegedly demanding a $300 bribe from a property owner in exchange for allowing renovation work without a permit.

ROBERTO URIBE, 55, of Chicago, is charged with attempted extortion for soliciting the bribe from an owner of a two-story building in Chicago, according to a criminal complaint and affidavit filed in U.S. District Court.  Unbeknownst to Uribe, the building owner was cooperating with federal authorities and had surreptitiously recorded the bribery demand. 

In a recorded conversation on Nov. 9, 2015, Uribe allegedly boasted of his ability to shut down the renovation work unless the owner paid him $300.  “What’s going to happen is, if we put a stop on it, it’s going to stop you for six months, seven months,” Uribe told the building owner, according to the complaint.  “So now, what’s happening now is you’re gonna give me some appreciation, and you’re gonna hurry up and get this done.  And that appreciation is gonna be $300.  Now how quickly can you get me my money to keep my mouth shut?”

Federal authorities arrested Uribe this morning.  He was released on a personal appearance bond after an initial hearing this afternoon before U.S. Magistrate Judge Sheila Finnegan in Chicago.  A status hearing is scheduled for April 26, 2016, at 1:15 p.m.

The attempted extortion charge is punishable by up to 20 years in prison and a $250,000 fine.

The arrest was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation; and Joseph M. Ferguson, Inspector General for the City of Chicago.

Uribe is employed as a Building/Construction Inspector for the City of Chicago Department of Buildings, which enforces the permitting and inspection requirements of the Chicago Building Code.  According to the complaint, Uribe initially approached workers performing renovations at the building and asked if they had a permit to work on the front window façade.  The workers put Uribe in touch with the building owner, who met with Uribe and learned of the bribery solicitation.

Uribe allegedly told the owner that paying a bribe to avoid a permit would save money and benefit both of them.  “This here will stop you for six months and it’ll cost you starting at $3,500 for an architect and plans,” Uribe told the owner in a recorded conversation, according to the complaint.  “I’m looking out for you, we’re looking out for each other.”

The public is reminded that a complaint is not evidence of guilt.  The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.  If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines. 

The government is represented by Assistant U.S. Attorney Sarah Streicker.

Complaint

CHICAGO — A Chicago physician and a member of her staff have been indicted for falsifying medical certifications to help applicants bypass tests for U.S. citizenship.

DR. JASMINKA KOSTIC and NIKKI POZDOL fraudulently diagnosed the applicants as physically or mentally impaired, which purportedly rendered them unable to demonstrate the required knowledge of U.S. history and the English language, according to an indictment returned yesterday in U.S. District Court in Chicago.  A medical certification of impairment allows individuals to seek a waiver from the civics and English-language tests required for naturalized U.S. citizenship.

Dr. Kostic, 59, of Chicago, and Pozdol, 47, of Chicago, are each charged with one count of knowingly making false statements in a document submitted to the U.S. Citizenship and Immigration Services.  Dr. Kostic is also charged with one count of attempted unlawful procurement of citizenship or naturalization.  Both charges are punishable by a maximum sentence of ten years in prison.

An arraignment date in federal court in Chicago has not yet been scheduled.

Dr. Kostic is a licensed physician who maintains a medical practice on the North Side of Chicago.  Pozdol worked in Dr. Kostic’s office.  According to the indictment, Dr. Kostic and Pozdol falsely certified that an applicant was unable to demonstrate the ability to read, write and speak English, and unable to answer questions regarding U.S. history and civics – even in a language understood by the applicant.  The certification also provided a false length of time in which a medical examination was allegedly rendered to the applicant, and a false description of the clinical methods used to diagnose the purported impairments, according to the indictment.

Dr. Kostic and Pozdol fraudulently certified the impairment results as true and correct in U.S. Citizenship and Immigration Services Form N-648, titled “Medical Certification for Disability Exceptions,” the indictment states.  The false N-648 would have allowed the individual to request a physical or mental impairment exception to the civics and English-language tests required for U.S. citizenship, according to the indictment.

The indictment was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; James M. Gibbons, Acting Special Agent-in-Charge of the Chicago Office of the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); and Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.

The public is reminded that an indictment contains only charges and is not evidence of guilt.  The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

The government is represented by Assistant United States Attorney Devlin Su.

Indictment

CHICAGO — Two men have been indicted in connection with the armed robberies of individuals at automated-teller machines in the west and northwest suburbs of Chicago, federal authorities announced today.

The indictment alleges that KENNETH HAYES and ANTONIO DUNNER forced victims to withdraw money from drive-thru ATMs.  Wearing disguises to cover their faces, the pair verbally threatened the individuals while Hayes brandished a firearm, the indictment states.  Hayes and Dunner divided the proceeds between themselves, according to the indictment.

The indictment was returned yesterday in U.S. District Court in Chicago.  It charges Hayes, 21, of Carpentersville, and Dunner, 22, of Elgin, with one count of conspiracy to interfere with commerce by threats or violence, five counts of interfering with commerce by threats or violence, and two counts of carrying, using or brandishing a firearm in connection with a crime of violence. 

An arraignment date in federal court has not yet been scheduled.

The indictment alleges that the pair robbed or attempted to rob individuals at drive-thru ATMs in Glen Ellyn on Sept. 16, 2015; Park Ridge on Sept. 23, 2015; Arlington Heights on Oct. 19, 2015; and Northbrook on Sept. 23, 2015, and Oct. 8, 2015. 

The pair is also accused in the indictment of robbing a gas station in Elmhurst on Nov. 1, 2015, with Hayes brandishing a firearm during the heist.

According to the indictment, Hayes and Dunner scouted drive-thru ATMs for potential robberies.  Once the pair settled on a location, they traveled to the site together in Hayes’ vehicle and concealed themselves while watching for individuals using the ATMs.  In addition to cash, Hayes and Dunner often stole the victims’ cellular telephones and disposed of them to prevent the victims from being able to quickly contact law enforcement, according to the indictment.

The indictment was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; and Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.  The Police Departments from Arlington Heights, Carpentersville, Elgin, Northbrook, Glen Ellyn, Park Ridge and Elmhurst provided substantial assistance in the investigation.

The conspiracy charge and each count of interfering with commerce by threats or violence carries a maximum sentence of 20 years.  Carrying, using or brandishing a firearm in connection with a crime of violence is punishable by a mandatory minimum sentence of seven years for the first count, and a mandatory minimum of 25 years for the second count.

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

The government is represented by Assistant U.S. Attorney Jordan Palmore.

Indictment

CHICAGO — More than 15 defendants, including three fathers and their sons, are facing federal or state drug charges for their alleged roles in dealing wholesale amounts of heroin and cocaine in Chicago and surrounding suburbs, authorities announced today.

During the course of the investigation, dubbed “Operation Chicago Storm,” law enforcement agents assigned to the Chicago Strike Force seized more than 100 kilograms of cocaine, nine kilograms of heroin, 14 firearms and $600,000 in narcotics proceeds.  Authorities uncovered the criminal activity through the use of wiretapped cellular phones, cooperating witnesses and extensive surveillance.

Fourteen federal defendants were arrested in the past week.  Two state defendants have been charged in separate complaints filed in state court.

According to federal criminal complaints and affidavits unsealed after the arrests, the investigation revealed that JULIO MARTINEZ SR. and his son, JULIO MARTINEZ JR., trafficked kilogram quantities of heroin and cocaine in the Chicago area, primarily on the Northwest Side of the city.  EDWIN DEL VALLE, also known as “Chino,” worked with the Martinezes to supply the narcotics to wholesale customers, the affidavits state.  Del Valle allegedly stashed the narcotics in a garage in the Portage Park neighborhood of Chicago.

Martinez Sr., 54, of Lawrenceville, Ga.; Martinez Jr., 32, of Chicago; and Del Valle, 38, of West Columbia, S.C., are each charged with one count of conspiracy to knowingly and intentionally possess with intent to distribute heroin, and one count of knowingly and intentionally possessing cocaine with the intent to distribute.

Two other sets of father and son were also charged as part of the investigation.  JUVENAL MARTINEZ, 66, and his stepson, ISRAEL MARTINEZ, also known as “Chino,” 32, both of Plainfield, were charged with participating in a conspiracy to distribute cocaine.  Also charged in a cocaine-dealing conspiracy were PHILLIP VEGA, also known as “Moose,” 42, of Berwyn, and his son, JACOB VEGA, 24, of Chicago.

Strike Force agents executing a search warrant as part of the investigation discovered a Glock 17 semiautomatic handgun in the home of Phillip Vega.  The search also uncovered 56 rounds of ammunition, 60 grams of cocaine, and a digital scale, according to the affidavits.

Throughout the course of the investigation, authorities surreptitiously recorded numerous drug transactions, including one near the Kennedy Expressway at Armitage Avenue in Chicago.  More than 140 grams of cocaine was allegedly sold in that deal by NICHOLAS PADIN, 28, of Chicago, who is charged with both the conspiracy and the possession with intent to distribute.

The charges were announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Dennis A. Wichern, Special Agent in Charge of the Chicago Field Division of the Drug Enforcement Administration; Eddie T. Johnson, Interim Superintendent of the Chicago Police Department; Anita Alvarez, Cook County State’s Attorney; and James D. Robnett, Special Agent-in-Charge of the Internal Revenue Service Criminal Investigation Division.

The investigation was conducted through the U.S. Organized Crime Drug Enforcement Task Force (OCDETF) Chicago Strike Force, which ― in addition to the DEA, IRS-CID and CPD narcotics officers ― consists of U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI), the FBI, the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives, the U.S. Marshals Service, and task force officers from various state and local law enforcement agencies, including the Cook County Sheriff’s Police and the Illinois State Police.

Also charged in the complaints with participating in a conspiracy to distribute heroin are JOSE RIVERA, 56, of Chicago; and MAURICE HART, also known as “Mo,” 46, of Chicago.

Charged with participating in a conspiracy to distribute cocaine are ADAM AGUIAR, 41, of Chicago; CHARLES MEDINA, 32, of Chicago; and LUIS MONTES, also known as “Nene,” 47, of Chicago.

The complaints charged LUIS NOCE, also known as “Guido,” 32, of Berwyn, with knowingly possessing cocaine with the intent to distribute.

The public is reminded that complaints contain only charges and are not evidence of guilt.  The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

Assistant United States Attorneys Christopher J. Stetler and Sean K. Driscoll are representing the government in the federal cases.  Assistant Cook County State’s Attorney Bronwyn Sears is prosecuting the state cases.

Montes and Padin Complaint and Affidavit

Martinez Israel/Juvenal Complaint

Vega Phillip/Jacob Complaint and Affidavit

Noce Complaint

Aguiar and Medina Complaint

CHICAGO — A New Lenox man who traded dozens of photos and videos of child pornography was sentenced today to more than ten years in federal prison.

Using the screen name trckgirl69, TERENCE MEAGHER traded the images and videos with others via a peer-to-peer file-sharing network on the Internet.  Many of the images depicted real prepubescent minors engaged in sexually explicit conduct, including portrayals of sadistic and masochistic activity.  Unbeknownst to Meagher, one of the users with whom he shared 88 pornographic images was an undercover law enforcement officer.

Meagher, 47, pleaded guilty last year to one count of transportation of child pornography.  U.S. District Judge Rebecca R. Pallmeyer imposed the 124-month sentence in federal court in Chicago.

“By distributing child pornography, through trades with others who sought child pornography, Defendant continued the victimization of children who have been filmed or photographed engaging in acts no child should be part of,” Assistant U.S. Attorney Scott Edenfield argued in the government’s sentencing memorandum.  “Defendant’s distribution of child pornography was frequent and extremely serious.”

In addition to sharing the pornographic images, Meagher admitted in a plea agreement that on Jan. 2, 2008, he surreptitiously photographed the private area of a minor child who was under the age of 12. 

The sentencing was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation; and Cook County Sheriff Thomas J. Dart.

The government is represented by Mr. Edenfield.

CHICAGO — A Los Angeles man was sentenced today to six months of home confinement for vandalizing a Grundy County fur farm and releasing more than 2,000 mink from their cages.

After releasing the mink, TYLER LANG and an accomplice spray painted the barn with the words, “Liberation is Love.”  The pair also poured an acidic substance over two trucks that were parked on the farm in Morris, Ill.

Lang, 27, pleaded guilty last year to one count of conspiring to travel in interstate commerce with the purpose of damaging an animal enterprise. 

U.S. District Judge Amy J. St. Eve sentenced Lang to three months’ time already served in prison, six months of community confinement and six months of home confinement, followed by one year of supervised release.

“Lang was not engaging in lawful activism or peaceful protest, but instead was committing a crime,” Assistant U.S. Attorney Bethany K. Biesenthal argued in the government’s sentencing memorandum.  “The use of illegal methods of activism – harassment, threats, vandalism – does nothing more than taint the image of law-abiding activists who are attempting to create change through legal protest and lawful demonstration.”

The accomplice, KEVIN JOHNSON, of Los Angeles, pleaded guilty last year to the same charge as Lang.  Judge St. Eve sentenced Johnson last month to three years in prison.

The vandalism and releasing of the mink occurred on Aug. 13, 2013.  The mink farmers, with assistance from law enforcement, were able to recover 1,600 of the animals.  The remaining mink died or were never found.  Lang and Johnson also destroyed cards from the cages that identified the breed of each animal, making it impossible to determine the breed of the recovered minks.

The sentencing of Johnson was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; and Michael J. Anderson, Special Agent-in-Charge of the Chicago office of the Federal Bureau of Investigation.  The government is represented by Ms. Biesenthal and Assistant U.S. Attorney William Ridgway.

ROCKFORD — A Polo, Ill. woman pleaded guilty today in federal court before U.S. District Judge Frederick J. Kapala to embezzling $59,560.88 from First State Bank Shannon-Polo. 

KAYLA C. BERGSTROM, 46, of Polo, was First Vice-President of First State Bank, with branches located in Polo and Shannon, Ill. 

According to the plea agreement, Bergstrom had the highest security level assigned in the bank’s software program, which controlled all customer bank accounts, the bank’s general ledger accounts, adding new accounts, and the maintenance of all bank accounts.  Bergstrom’s responsibilities included reconciling all of the bank’s correspondent accounts including the bank’s correspondent account with US Bank.  Bergstrom stated in the plea agreement that between Feb. 23, 2010 and Feb. 3, 2014, she embezzled a total of $59,560.88 from First State Bank by creating 34 separate cash advance tickets for the bank’s correspondent account at US Bank and crediting the amounts of cash advance tickets to her personal account and the business account for her husband’s automobile repair business.  Bergstrom admitted in her plea agreement that she concealed her embezzlement by changing the balances on the bank’s US Bank account statements by manually cutting and pasting false account balances on the statements.  The deposits of the bank were insured by the Federal Deposit Insurance Corporation.

Bergstrom faces a maximum sentence of 30 years’ imprisonment, a term of supervised release of up to five years following imprisonment, and a fine of up to $1 million.  Sentencing for Bergstrom is set for June 28, 2016, at 9:00 a.m. before U.S. District Judge Philip G. Reinhard. 

The guilty plea was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of Federal Bureau of Investigation; and Joseph Moriarty, Special Agent in Charge for the Chicago Regional Office, Federal Deposit Insurance Corporation - Office of Inspector General.

The government is represented by Assistant U.S. Attorney Joseph C. Pedersen.

Plea Agreement

CHICAGO — A federal judge today convicted a Chicago marketer of taking illegal payments in exchange for referring elderly patients to a Skokie-based home healthcare company.

JENETTE GEORGE was convicted on two counts of violating the federal Medicare and Medicaid Anti-Kickback Statute, and one count of conspiracy to violate the statute.  U.S. District Judge John W. Darrah issued the verdict in federal court in Chicago.

George, 62, of Chicago, faces up to 15 years in prison when she is sentenced by Judge Darrah on August 10, 2016, at 1:30 p.m.

George is the eleventh defendant to be convicted as part of the federal investigation into the bribes-for-referrals and fraud schemes at Rosner Home Healthcare Inc.  The prior convictions include three of the company’s owners, as well as two Illinois physicians.  Between January 2008 and July 2012, Rosner officials paid kickbacks and bribes to doctors, marketers, medical office employees and nurses to refer patients to Rosner.  The referrals enabled Rosner to bill Medicare for home healthcare treatment that it subsequently provided.

“Physicians did not refer patients to Rosner; Defendant did,” Judge Darrah wrote in an opinion supporting the George verdict.

Rosner, which was based in Skokie and later in Morton Grove, has since closed.

George operated Ttenej Senior Referral Agency, which provided senior citizens with referrals to home healthcare firms in the Chicago area.  Evidence at her three-day bench trial in October 2015 revealed that George received approximately $500 from Rosner for each patient she referred to the company.  In one undercover surveillance video presented at trial, George is seen counting out the cash that she received from EDGARDO HERNAL, a former Rosner employee who by then was cooperating with federal authorities.  Evidence at trial further showed that nurses at Rosner regularly put false information into patient charts to make Rosner’s services appear to be medically necessary, and to make patients appear to be sicker than they actually were.

Hernal pleaded guilty in 2013 to a conspiracy charge and is awaiting sentencing.  In addition to George and Hernal, the other defendants convicted in the investigation are:

ANA NERISSA TOLENTINO, of Morton Grove, a nurse and former part owner of Rosner.

ARMANDO TOLENTINO, of Morton Grove, a nurse and former part owner of Rosner.

FREDERICK MAGSINO, of Morton Grove, a former part owner of Rosner.

EMMANUEL NWAOKOCHA, of Skokie, an Illinois physician.

MASOOD SYED, of Mount Prospect, an Illinois physician.

JENNIFER HOLMAN, of Chicago, an office manager in a medical office.

TITIS JACKSON, also known as Titus Jackson, of Chicago, a marketer who referred Medicare patients to Rosner.

LIONEL PAUL GASSMANN, of Skokie, a Rosner nurse who treated patients in their homes.

GLORIA ZISMAN, of Des Plaines, a Rosner nurse who treated patients in their homes.

In addition, ARTHUR DAVIDA, a Bloomingdale physician who falsely certified many of Rosner’s patients for home-health services, including some referred by George, was convicted of health care fraud in a related case.  Davida was sentenced earlier this year to two years in prison.

The conviction of George was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Lamont Pugh III, Special Agent-in-Charge of the Chicago Region of the U.S. Department of Health and Human Services Office of Inspector General; and Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.

The investigation was carried out by the Medicare Fraud Strike Force, which is part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative between the U.S. Justice Department and the U.S. Department of Health and Human Services to prevent fraud and to enforce anti-fraud laws around the country.  Dozens of defendants have been charged in numerous fraud cases since the strike force began operating in Chicago in 2011.

The government is represented by Assistant U.S. Attorneys Stephen Chahn Lee and Elizabeth Pozolo.