District of Kansas

WICHITA, KAN. - A Wichita man was sentenced Thursday to 46 months in federal prison for turning stolen mail into 14 false identities, U.S. Attorney Tom Beall said.

 

Jeremy Peterson, 43, Wichita, pleaded guilty to one count of conspiracy to produce false identification documents. In his plea, he admitted that other conspirators provided him with stolen mail he used to produce counterfeit documents including driver’s licenses and state identification cards. He produced documents for 14 stolen identities that conspirators used to buy cars. Local auto dealers suffered an actual loss of more than $218,000 as a result.

 

Peterson was one of 13 defendants charged last year in USA v Below, an indictment alleging they took part in a $3.5 million fraud scheme.

 

Beall commended the U.S. Postal Inspection Service, the Sedgwick County Sheriff’s Department, the Wichita Police Department, the Bureau of Alcohol, Tobacco, Firearms and Explosives and Assistant U.S. Attorney Alan Metzger for their work on the case.

WICHITA, KAN. - A Pratt company pleaded guilty Thursday in an oil and gas fraud scheme, U.S. Attorney Tom Beall said.

 

Sonstone Trading LLC pleaded guilty to one count of wire fraud. In the plea, the company admitted it agreed to sell 3,000 barrels per month of crude oil to Parnon Industries. In fact, what Sonstone provided to Parnon was not crude oil. It was raw gas oil (RGO), which is a by-product obtained from recycling used motor oil. At sentencing, the court will determine the amount of loss. The government maintains the loss is more than $994,000. Sentencing is set for Aug. 10.

 

Charges against Sonstone executive David Lawson were dismissed.

 

For more information on oil and gas fraud from the Financial Fraud Enforcement Task Force, see www.stopfraud.gov/oil-gas-fwg.html .

 

Beall commended the FBI and Assistant U.S. Attorney Alan Metzger for their work on the case.

WICHITA, KAN. - A Labette County woman was indicted Wednesday on a federal charge of embezzling more than $200,000 from the bank where she worked, U.S. Attorney Tom Beall said.

 

Debra J. Nading, 59, Oswego, Kan., was charged with one count of embezzlement by a bank employee. The indictment alleged Nading stole approximately $213,173 from Labette Bank while she worked as an assistant cashier.

 

If convicted, she faces up to 30 years in federal prison and a fine up to $1 million. The FBI investigated. Assistant U.S. Attorney Alan Metzger is prosecuting.

 

OTHER INDICTMENTS

 

 

Xavier Jauregui Larios, 33, of Durango, Mexico, is charged with one count of possession with intent to distribute 10.7 kilograms of cocaine. The crime is alleged to have occurred April 10, 2017, in Clark County, Kan.

 

If convicted, he faces a penalty of not less than 10 years in federal prison and a fine up to $10 million. The Drug Enforcement Administration investigated. Special Assistant U.S. Attorney Kimberly Rodebaugh is prosecuting.

 

Victor Irigoyen, 20, Garden City, Kan., is charged with one count of possession with intent to distribute methamphetamine. The crime is alleged to have occurred May 4, 2017, in Finney County, Kan.

 

If convicted, he faces a penalty of not less than five years and not more than 40 years in federal prison and a fine up to $5 million. The Drug Enforcement Administration investigated. Special Assistant U.S. Attorney Kimberly Rodebaugh is prosecuting.

 

Darren M. Williams, 35, Wichita, Kan., and Ebony D. James, 24, Wichita, Kan., are charged with two counts of unlawful possession of a firearm following a felony conviction and one count of unlawful possession of ammunition following a felony conviction. In addition, Williams is charged with one more count of unlawful possession of a firearm following a felony conviction. The crimes are alleged to have occurred in April 2017 in in Sedgwick County, Kan.

 

If convicted, they face up to 10 years in federal prison and a fine up to $250,000 on each count. The Bureau of Alcohol, Tobacco, Firearms and Explosives, the Wichita Police Department and the U.S. Marshals Service investigated. Assistant U.S. Attorney Lanny Welch is prosecuting.

 

Juan Carlos Reyes-Flores, 36, Los Angeles, Calif., is charged with one count of possession with intent to distribute methamphetamine. The crime is alleged to have occurred April 25, 2017, in Ellis County, Kan.

 

If convicted, he faces not less than 10 years in federal prison and a fine up to $10 million. The Drug Enforcement Administration investigated. Assistant U.S. Attorney David Lind is prosecuting.

 

Jorge Carrillo-Hernandez, 35, who has been living in Kansas City, Mo., is charged with unlawfully re-entering the United States after he was convicted of an aggravated felony and deported. He was found in Kansas May 1, 2017.

 

If convicted, he faces up to 20 years in federal prison and a fine up to $250,000. Immigration and Customs Enforcement investigated. Assistant U.S. Attorney Leon Patton is prosecuting.

 

Victoria M. Carlile, 30, Liberal, Kan., is charged with counterfeiting $50 and $100 bills. The crime is alleged to have occurred in January 2017 in Seward County, Kan.

 

If convicted, she faces up to 20 years in federal prison and a fine up to $250,000. The U.S. Secret Service investigated. Assistant U.S. Attorney Alan Metzger is prosecuting.

 

 

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

 

TOPEKA, KAN. - A former office manager for a Lawrence property management company was sentenced Tuesday to 24 months in federal prison for embezzlement, U.S. Attorney Tom Beall said. She was ordered to pay more than $485,000 in restitution.

 

Candy A. Gunderson, 45, Lawrence, pleaded guilty to one count of interstate transportation of stolen funds. In her plea, Gunderson admitted the crime took place from 2007 to 2015 while she was office manager for Garber Enterprises in Lawrence. She used various means to steal money from the company including:

• Depositing into her personal account checks made payable to Garber Enterprises.

• Issuing forged Garber Enterprises checks.

• Using company funds to pay bills for work performed on rental properties she owned.

• Using the company VISA card for personal expenses.

• Depositing cash belonging to the company into her personal accounts.

• Forging checks on Garber’s account to pay for personal phone bill.

 

Beall commended the Lawrence Police Department, the FBI and Assistant U.S. Attorney Rich Hathaway for their work on the case.

KANSAS CITY, KAN. - A truck driver was sentenced Monday to 46 months in federal prison for hauling more than 44 pounds of cocaine to Kansas, U.S. Attorney Tom Beall said.

 

Erick Omar Rios, 37, San Ysidro, Calif., pleaded guilty to one count of possession with intent to distribute cocaine. In his plea, he admitted he was operating a tractor pulling a refrigerated trailer when he was stopped by the Kansas Highway Patrol. Troopers found 10 vacuum wrapped packages containing 44 pounds of cocaine hidden in a cooling unit on the trailer. They learned Rios had picked up the load in Los Angeles to deliver to Plainfield, Ind. He was expecting to be paid $4,000 when he returned to Los Angeles.

 

Beall commended the Kansas Highway Patrol, the Drug Enforcement Administration and Special Assistant U.S. Attorney Skip Jacobs for their work on the case.

KANSAS CITY, KAN. - A Kansas City man was sentenced Monday to 52 months for a robbery at a Leawood bank, U.S. Attorney Tom Beall said.

 

Chad English, 43, Kansas City, Mo., pleaded guilty to one count of bank robbery. In his plea, he admitted he drove the getaway car during an Aug. 24, 2016, robbery at Central Bank of the Midwest at 4801 Town Center Drive in Leawood. Co-defendant Terry Lovelady, 58, Kansas City, Mo., went into the bank and gave the clerk a note saying, “Hurry up. Put the $$ in the bag. No funny bizz.” He left the bank with stolen money and a hidden tracking device.

 

Police followed the tracking device to locate the getaway car where it was stopped at a traffic light at 119th Street and Glenwood. The robbers led police on a chase, running red lights, cutting off other drivers and reaching a speed of 90 mph. The robbers crossed into Missouri before stopping the car and fleeing on foot. Officers tackled English. Lovelady was found hiding in a hospital parking garage.

 

Lovelady pleaded guilty and he is set for sentencing July 31.

 

Beall commended the FBI, the Leawood Police Department, the Kansas City, Mo., Police Department and Assistant U.S. Attorney Leon Patton for their work on the case.

KANSAS CITY, KAN. - A former executive of a Kansas City-area roofing company has been sentenced to prison in connection with the company’s employment of aliens not authorized to work in the United States, U.S. Attorney Tom Beall announced today.

 

The former executive, Tommy F. Keaton, 71, Shawnee, Kan., was sentenced Monday by Chief U.S. District Judge Julie Robinson to 12 months and 1 day in federal prison, to be followed by one year of supervised release. Keaton was indicted in June 2016 in connection with the use of undocumented workers by Century Roofing, whose corporate name is Canadian West, Inc., to install commercial and residential roofs in the Kansas City metropolitan area.

 

In addition, Judge Robinson ordered the forfeiture of $1.4 million seized from Keaton in the case. Keaton remains on bond but must report to federal prison when so ordered by the U.S. Marshals Service. He pleaded guilty Feb. 16 to harboring an alien unlawfully in the U.S., a felony, pursuant to a plea agreement in which he admitted his conduct involved harboring up to 24 undocumented aliens in the United States through roofing projects managed by Century.

 

Previously, two other defendants pleaded guilty and were sentenced in the case, Graziano Cornolo, 56, Lenexa, and Alberto Diaz-Hernandez, 34. Cornolo pleaded guilty to unlawful employment of aliens and was placed on probation. In addition, Cornolo forfeited more than $800,000 and his interest in $500,000 seized from Century. Diaz-Hernandez pleaded guilty to misprision of a felony in connection with Century’s unlawful employment practices and was placed on two years’ probation.

 

In all, more than $2 million is assets were forfeited in the case, in addition to the criminal convictions and sentences. Beall said the case involved multiple local, state and federal law enforcement agencies led by Homeland Security Investigations, and he thanked them for their outstanding work on the case. The case was prosecuted by Assistant U.S. Attorney Brent Anderson.

WICHITA, KAN. – A Wichita man was sentenced Thursday to 293 months in federal prison for human trafficking, U.S. Attorney Tom Beall said.

 

Daederick Lacy, 26, Wichita, Kan., was found guilty in a jury trial in February on one count of sex trafficking of a minor, one count of sex trafficking of an adult by force, fraud or coercion and one count of interstate transportation of a minor in furtherance of prostitution.

 

During trial prosecutors, presented evidence that three female victims – two minors and an adult – were trafficked for sex by Lacy. Lacy advertised victims on an adult Web site, rented rooms at motels for sex, transported victims to meetings with men who paid for sex, and drove a minor victim from Kansas to Texas to serve as a prostitute.

 

Beall commended the Wichita Police Department, the Mesquite (Texas) Police Department and Assistant U.S. Attorney Jason Hart for their work on the case.

KANSAS CITY, KAN. - A federal grand jury today indicted a Sedgwick County man on charges of sexually exploiting a child, U.S. Attorney Tom Beall said.

 

Ian Nathanial Smith, 20, Viola, Kan., is charged with one count of sexual exploitation of a child, one count of possessing child pornography and a new count of traveling across state lines to engage in sex acts with a child. Smith initially was charged in a criminal complaint filed May 4.

 

An investigator’s affidavit alleges Smith used social media to communicate over the internet with a 14-year-old girl in another state. He asked the girl to send him live streaming video of herself engaged in sexual activities. Investigators found child pornography on his phone, including 204 images and four videos.

 

If convicted, he faces not less than 15 years and not more than 30 years in federal prison on the charge of exploiting a minor, not less than 10 years and a fine up to $250,000 on the interstate travel charge and up to 10 years and a fine up to $250,000 on the possession charge. The FBI investigated. Assistant U.S. Attorney Jason Hart is prosecuting.

 

 

 

OTHER INDICTMENTS

 

Xzavier Christian Guliford, 24, Wichita, Kan., is charged with one count of unlawful possession of a firearm following a felony conviction. The crime is alleged to have occurred March 18, 2017, in Jackson County, Kan.

 

If convicted, he faces up to 10 years in federal prison and a fine up to $250,000. The Bureau of alcohol, Tobacco, Firearms and explosives investigated. Assistant U.S. Attorney Lanny Welch is prosecuting.

 

Juan Gabriel Barron-Hernandez, 33, who has been living in Wichita, Kan., is charged with one count of unlawful possession of a firearm by an unauthorized alien, one count of illegal possession of a sawed off shotgun and one count of unlawful possession of a firearm with the serial number removed. The crimes are alleged to have occurred March 16, 2017, in Sedgwick County, Kan.

 

If convicted he faces up to 10 years in federal prison and a fine up to $250,000 on each of the first two counts and up to five years and an fine up to $250,000 on third count. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated.

 

Ruth Noemy Galvan, 25 Long Beach, Calif., is charged with one count of possession with intent to distribute methamphetamine. The crime is alleged to have occurred March 24, 2017, in Clark County, Kan.

 

If convicted, she faces not less than 10 years in federal prison and a fine up to $10 million. The Drug Enforcement Administration investigated.

 

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

TOPEKA, KAN. B A Topeka man pleaded guilty Tuesday to lying to investigators in a 2016 interview during a search for fugitive Orlando J. Collins, U.S. Attorney Tom Beall said today.

 

Quentin Kirk Lawton, 37, pleaded guilty to one count of making a false statement. In his plea, he admitted that on April 23, 2016, he visited Collins in a room at the Country Club Motel at 3732 S.W. Topeka Boulevard. Lawton left the motel shortly before a standoff between Collins and federal agents. When the FBI questioned Lawton about Collins’ whereabouts, Lawton denied he had been to the motel and seen Collins. In fact, Lawton was captured on video surveillance entering and leaving Collins’ room shortly before members of a federal task force attempted to arrest Collins.

 

When members of a task force tried to take Collins into custody he shot two U.S. Marshals and an FBI agent. A fire ignited from inside Collins’ room during the gunfight and spread throughout the motel. After the fire, Collins’ body was found in the motel room.

 

Sentencing is set for Aug. 14. Both parties have agreed to recommend a sentence of 42 months in federal prison. Beall commended the U.S. Marshals Service investigated and Assistant U.S. Attorney Jared Maag for their work on the case.

WICHITA, KAN. - A Wichita man was sentenced Monday to five years in federal prison for carrying a firearm in furtherance of drug trafficking, U.S. Attorney Tom Beall said.

 

Daniel Christian Thomas, 32, Wichita, Kan., pleaded guilty to one count of unlawful possession of a firearm in furtherance of drug trafficking. In his plea, he admitted he was driving a PT Cruiser that had been reported stolen when the Sedgwick County Sheriff’s office stopped him. A search of the car turned up a .45 caliber Bond Arms Snake Slayer derringer and .410 shotgun shells as well three baggies containing methamphetamine, two digital scales and approximately $1,000 in cash.

 

Beall commended the Sedgwick County Sheriff’s Department and Assistant U.S. Attorney Alan Metzger for their work on the case.

TOPEKA, KAN. - A man and a woman from Manhattan were sentenced Monday to 28 years in federal prison for taking part in the kidnapping of a Junction City woman who was killed during the abduction, U.S. Attorney Tom Beall said.

 

Larry L. Anderson, 28, Manhattan, Kan. pleaded guilty to one count of kidnapping resulting in death. His girlfriend, Marryssa M. Middleton, 26, Fort Riley, Kan. pleaded guilty to one count of conspiracy to commit kidnapping resulting in death.

 

The body of Amanda Clemons, 24, of Junction City, was found in February 2014 in Geary County, Kan. In their pleas, Anderson and Middleton admitted that on Feb. 7, 2014, they and co-defendants met the victim, who was a prostitute, at a hotel in Junction City and kidnapped her. The defendants beat the victim in retribution for comments the victim had made on social media about having a sexual relationship with Anderson. During the beating, the defendants demanded the victim pay $300. They took the victim to another hotel room in an unsuccessful attempt to get the money, after which they transported the victim to a residence on Fort Riley.

 

While there, the defendants allowed the victim to call her mother. The victim’s mother realized the victim was in danger and called Junction City Police. When police called the victim’s number to check on her, and the defendants listened to the call on speaker phone. Fearing arrest, the defendants transported the victim to a bridge in a remote part of Geary County, where they resumed the beating and attacked her with a knife. The victim broke free and jumped off the bridge, falling 15 feet and breaking her ankle. Some of the defendants found the victim in the snow and resumed the assault during which they cut her throat and killed her.

 

Co-defendants include:

Drexel Woody, 26, who lived on Fort Riley at the time of the crime, is set for sentencing June 26.

Shantrell D. Woody, 27, Fort Riley, Kan., formerly an active duty service member, is set for sentencing May 30.

Christopher Pugh, 33, Junction City, Kan., is set for sentencing June 26.

 

Beall commended the Junction City Police Department, the Grandview Plaza Police Department, the Geary County Sheriff’s Office, the Riley County Police Department, the Fort Riley Criminal Investigation Division, the FBI, Assistant U.S. Attorney Tony Mattivi, Assistant U.S. Attorney Jared Maag and Geary County Attorney Steven Opat for their work on the case.

KANSAS CITY, KAN. - A Dodge City medical equipment supplier has agreed to pay $1 million to settle allegations it submitted false claims to the Medicare program, U.S. Attorney Tom Beall said today.

 

Pos-T-Vac, Inc., a medical equipment supplier located in Dodge City, has agreed to pay the U.S. government $1 million to settle claims that it violated the False Claims Act by improperly charging Medicare for durable medical supplies.

 

The United States alleged that from Jan. 1, 2009 through July 27, 2012, Pos-T-Vac submitted claims for male vacuum erection supplies that were not medically necessary, lacked documentation of medical necessity, and/or were not properly ordered by a physician.

 

Medicare no longer covers such supplies.

 

“We must prevent waste, fraud and abuse in the Medicare and Medicaid programs,” said United States Attorney Tom Beall. “Billions of taxpayer dollars are at stake.”

 

“Our office will continue to protect the Medicare program by pursuing those providers who bill for medically unnecessary services and supplies,” said Steve Hanson, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General, Office of Investigations, Kansas City, Mo.

 

During the investigation, Medicare suspended payments to Pos-T-Vac. Under the terms of the settlement, the government will retain those funds and Pos-T-Vac will make additional payments to the United States.

 

The U.S. Department of Health and Human Services – Office of the Inspector General (HHS-OIG) and the United States Attorney’s Office for the District of Kansas investigated. Assistant U.S. Attorney Jon Fleenor represented the government.

 

TOPEKA, KAN. - A former teller at a bank in Burlington was sentenced Friday to 51 months in federal prison for embezzling from the bank, U.S. Attorney Tom Beall said today. She was ordered to pay more than $850,000 in restitution.

 

Denise Christy, 48, Burlington, Kan., was convicted in a jury trial in January on one count of embezzlement, six counts of making false bank entries, six counts of filing false tax returns and six counts of money laundering.

 

During trial, the prosecutor presented evidence the crimes were committed while Christy worked as a retail financial services representative and backup vault teller for the Burlington branch of Central National Bank. One of Christy’s duties was to sell cash in the bank’s vault to the Federal Reserve Bank. In May 2014 auditors determined that more than $700,000 was missing from the vault. Christy falsely claimed the money was shipped to the Federal Reserve Bank via the Garda security company. An investigation showed Christy falsified bank records to cover up the embezzlement and failed to report the embezzled funds as part of her income. In addition, she unlawfully conducted financial transactions in order to spend more than $77,000 in embezzled funds to pay off loans that she and her husband maintained at Farmers State Bank in Aliceville, Kan.

 

Beall commended the Internal Revenue Service and Assistant U.S. Attorney Rich Hathaway for their work on the case.

WICHITA KAN. - A Crawford County man was sentenced Thursday to five years in federal prison for distributing child pornography, U.S. Attorney Tom Beall said.

 

Mark D. Busby, 48, Mulberry, Kan., pleaded guilty to one count of distributing child pornography. In his plea, he admitted he installed software from the Ares file-sharing network on his computer and used it download child pornography and share it with other users. An investigator with the Kansas Internet Crimes Against Children Task Force downloaded child pornography from Busby’s computer.

 

Beall commended the Kansas Internet Crimes Against Children Task Force, Homeland Security Investigations and Assistant U.S. attorney Jason Hart for their work on the case.

WICHITA, KAN. - A Kansas man was charged in U.S. District Court here Wednesday with producing child pornography, U.S. Attorney Tom Beall said.

 

Ian Nathanial Smith, 20, Viola, Kan., is charged with one count of sexual exploitation of a child and one count of possessing child pornography. An investigator’s affidavit alleges Smith used social media to communicate over the internet with a 14-year-old girl in another state. He asked the girl to send him live streaming video of herself engaged in sexual activities. Investigators found child pornography on his phone, including 204 images and four videos.

 

If convicted, he faces not less than 15 years and not more than 30 years in federal prison on the charge of exploiting a minor and up to 10 years and a fine up to $250,000 on the possession charge. The FBI investigated. Assistant U.S. Attorney Jason Hart is prosecuting.

 

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

WICHITA KAN. - A registered sex offender from Wichita was sentenced Thursday to 195 months in federal prison for distributing child pornography, U.S. Attorney Tom Beall said.

 

Jeremy Michael Schmidt, formerly known as Jeremy Michael Davis, 41, Wichita, Kan., pleaded guilty to one count of distributing child pornography. In 2013, Schmidt was convicted in Florida on a possession of child pornography charge and registered as a sex offender under the name Jeremy Michael Davis. He later changed his name to Jeremy Michael Schmidt.

 

Schmidt came to the attention of investigators in Wichita when they received four separate Cyber Tipline Reports from the National Center for Missing and Exploited Children. Investigators identified emails in which Schmidt provided links to child pornography.

 

Beall commended the Wichita Police Department, Homeland Security Investigations, the Internet Crimes Against Children Task Force and Assistant U.S. attorney Jason Hart for their work on the case.

TOPEKA, KAN. – A federal grand jury returned an indictment Wednesday charging a Topeka man in eight robberies committed over a period of five months, U.S. Attorney Tom Beall said.

 

Joshua Alexander Musgraves, 24, Topeka, is charged in a superseding indictment with 13 counts as follows:

 

Date: Jan. 6, 2017

Place: Plato’s Closet, 1580 SW Wanamaker, Topeka.

Charges: Robbery (count one); brandish a weapon (count two).

 

Date: Jan. 20, 2017

Place: Kentucky Fried Chicken, 1812 NW Topeka in Topeka.

Charges: Robbery (count three), brandish a firearm (count four).

 

Date: March 23, 2017

Place: Burger King, 2817 Southeast California, Topeka.

Charges: Robbery (count five), brandish a firearm (count six).

 

Date: March 30, 2017

Place: McDonalds, 1100 S. Kansas, Topeka.

Charges: Robbery (count seven).

 

 

Date: April 3, 2017

Place: Subway restaurant, 1601 W. 23rd, Lawrence.

Charges: Robbery (count eight), brandish a firearm (count nine).

 

Date: April 4, 2017

Place: Wing Stop, 2233 Louisiana, Lawrence, Kan.

Charges: Robbery (count 10), brandish a firearm (count 11).

 

Date: Dec. 10, 2016

Place: Denison State Bank, 3640 Southwest Fairlawn, Topeka.

Charges: Bank robbery (count 12).

 

Date: Dec. 10, 2016

Place: Topeka

Charges: Carjacking (count 13).

 

If convicted, he faces the following penalties:

 

Counts one, three, five, seven, eight and 10: Up to 20 years and a fine up to $250,000.

Counts two, four and 11: Not less than seven years and a fine up to $250,000.

Counts six and nine: Not less than 10 years and a fine up to $250,000.

Count 12: Up to 25 years and a fine up to $250,000.

Count 13: Up to 15 years and a fine up to $250,000.

 

The Topeka Police Department and the FBI investigated. Assistant U.S. Attorney Jared Maag is prosecuting.

 

OTHER INDICTMENTS

 

Arlie J. Barhum, 32, who is in custody in the Shawnee County Jail, is charged with is charged with one count of unlawful possession of a firearm following a felony conviction. The crime is alleged to have occurred March 21, 2017, in Topeka.

 

If convicted, he faces up to 10 years in federal prison and a fine up to $250,000. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Duston Slinkard is prosecuting.

 

Mark A. Richardson, 29, who is in custody in the Shawnee County Jail, is charged with is charged with one count of unlawful possession of a firearm following a felony conviction. The crime is alleged to have occurred April 7, 2017, in Topeka.

 

If convicted, he faces up to 10 years in federal prison and a fine up to $250,000. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Duston Slinkard is prosecuting.

 

Sandra Rodriguez-Ruiz, 36, Laveen, Ariz., is charged with one count of possession with intent to distribute heroin. The crime is alleged to have occurred March 25, 2017, in Ellsworth County, Kan.

 

If convicted, she faces a penalty of not less than 10 years and a fine up to $10 million. The Drug Enforcement Administration investigated. Assistant U.S. Attorney Greg Hough is prosecuting.

 

Jaiquan Jahai Wheeler, 20, who is in custody, is charged with one count of possession with intent to distribute marijuana, one count of unlawful possession of a firearm in furtherance of drug trafficking, and one count of unlawful possession of a firearm following a felony conviction. The crimes are alleged to have occurred March 14, 2017, in Shawnee County, Kan.

 

If convicted, he faces up to five years and a fine up to $250,000 on the marijuana charge, not less than five years and a fine up to $250,000 on the firearm in furtherance of drug trafficking charge, and up to 10 years and a fine up to $250,000 on the remaining count. The FBI investigated. Assistant U.S. Attorney Jared Maag is prosecuting.

 

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

TOPEKA, KAN. - A Texas man was sentenced Monday to time served (two years) for selling designer drugs manufactured in Kansas, U.S. Attorney Tom Beall said.

 

Michael Myers, 37, Montgomery, Texas, pleaded guilty to one count of conspiracy to possess with intent to distribute controlled substances and one count of conspiracy to commit mail fraud.

 

Myers was indicted in April 2014 along with co-defendants Tracy Picanso and Roy Ehrett, the owners of an Olathe-based business that produced and sold dangerous controlled substances and controlled substance analogs of THC (the active ingredient in marijuana) and methcathinones (stimulants). Picanso and Ehrett are awaiting sentencing.

 

Picanso and Ehrett sold products to distributors under names including Pump It, Head Trip, Black Arts, Grave Digger, Voodoo Doll and Lights Out. Some of the counterfeit drugs were manufactured in buckets with drill-powered immersion mixers and tried out on “testers” who helped tweak the recipes.

 

Myers and co-defendant Michelle Reulet lived together in Houston, Texas, and owned and operated Bully Wholesale, an independent wholesaler and distributor of products purchased from Picanso and Ehrett.

 

Ehrett routinely traveled from Kansas City to Houston to pick up cash from Reulet and Myers. On at least two occasions Myers met Ehrett in Oklahoma to transfer in excess of $100,000 cash to him. Investigators collected emails and text messages exchanged among the defendants. In an October 2011 email, for instance, Myers claimed the fake weed he was selling would not show up on a drug test. In a January 2012 email to Ehrett, Myers says he and Reulet were buying $600,000 to $900,000 worth of products each month from Ehrett and Picanso.

 

Beall commended the Drug Enforcement Administration, the Food and Drug Administration – Office of Criminal Investigations, the Department of Homeland Security, Homeland Security Investigations, Customs and Border Protection, the FBI, the Overland Park Police Department, the Johnson County Sheriff’s Office, the Olathe Police Department, the St. Joseph Police Department and the Buchanan County Drug Strike Force, Assistant U.S. Attorney Tanya Treadway, Michael Varrone, associate chief counsel at the Food and Drug Administration, and Assistant U.S. Attorney Tony Mattivi for their work on the case.

KANSAS CITY, KAN. – A Kansas City area chiropractor has agreed to pay more than $1 million to settle allegations his offices submitted false claims to Medicare for treating patients with peripheral neuropathy, U.S. Attorney Tom Beall said today.

 

Brian Schnitta and his clinic, Natural Way Chiropractic Center, P.A., have agreed to pay the U.S. government $1,038,903 to settle allegations that they violated the federal False Claims Act. Schnitta owns and operates chiropractic offices in Overland Park and Lenexa, Kan., and in Lee’s Summit, Mo.

 

The United States alleged that from July 1, 2011 through May 31, 2013, Schnitta and the clinic claimed they provided treatments for peripheral neuropathy and charged Medicare for several procedures that were not medically necessary or not otherwise covered by the program. The claimed procedures included nerve conduction tests, nerve block injections, and ultrasound needle guidance. Peripheral neuropathy affects nerves in the hands and feet and includes symptoms such loss of sensation and/or a burning sensation.

 

“Medicare is designed to ensure that this country’s elderly have access to vital health care services,” Beall said. “This office will continue efforts to protect the program and beneficiaries from providers that submit false claims for personal gain.”

 

“The investigation of Natural Way Chiropractic Center and its owner Brian Schnitta, D.C. reflects the seriousness with which our office views any allegations involving fraud, waste and abuse within our Federal health care programs,” said Special Agent in Charge Steven Hanson of the Kansas City Regional Office of Investigations for the Department of Health and Human Services.”

 

During the investigation, Medicare suspended payments to the clinic for the suspect services. Under the terms of the settlement, Schnitta and Natural agreed to forego those payments and to make additional payments to the government.

 

According to the agreement, Schnitta and Natural Way deny any wrongdoing.

 

The U.S. Department of Health and Human Services – Office of the Inspector General (HHS-OIG) and the United States Attorney’s Office for the District of Kansas investigated. Assistant United States Attorney Jon Fleenor represented the government.

WICHITA, KAN. - A Wichita woman who used stolen mail to create counterfeit checks and credit cards was sentenced Wednesday to 34 months in federal prison, U.S. Attorney Tom Beall said.

 

Lateasha Linthicum, 36, Wichita, Kan., pleaded guilty to one count of conspiracy to receive stolen mail and to commit theft. In her plea, she admitted she caused a loss of more than $300,000 to victims. When Wichita police served a search warrant at Linthicum’s room in the Inn at Tallgrass they found a large storage trunk containing documents credit cards, mail and checks in the names of other people.

 

Beall commended the Wichita Police Department and Assistant U.S. Attorney Debra Barnett for their work on the case.

WICHITA, KAN. - A Wichita man was sentenced Wednesday to seven years in federal prison for brandishing a firearm during a robbery at a convenience store, U.S. Attorney Tom Beall said.

 

Quincy D. Hadley, 36, Wichita, admitted that on Oct. 26, 2016, he pointed a .40-caliber pistol at a clerk during a robbery at the Presto gas station at 4414 W. Maple in Wichita. Hadley demanded and received cash and cigarettes before he fled the store.

 

He was arrested when an officer responding to a 911 call found him changing clothes in a parked car.

 

Beall commended the Wichita Police Department and Assistant U.S. Attorney Brent Anderson for their work on the case.

 

WICHITA, KAN. - A Derby man was sentenced Wednesday to 12 months and a day for stealing mail while he worked as a mail carrier, U.S. Attorney Tom Beall said.

 

Gary W. Yenzer, 34, Derby, Kan., pleaded guilty to one count of theft of U.S. mail. In his plea, he admitted that in August and September 2016 while working as a mail carrier in rural Sedgwick County he stole mail. Investigators learned Yenzer looked for birthday and anniversary cards so he could remove cash and gift cards. He kept the cash and sold some of the gift cards for cash, but he did not use the gift cards for fear of them bring traced to him.

 

Beall commended the U.S. Postal Service-Office of Inspector General and Assistant U.S. Attorney Brent Anderson for their work on the case.

 

WICHITA, KAN. B A Goddard man was sentenced Wednesday to 41 months in federal prison for two commercial robberies in Wichita, U.S. Attorney Tom Beall said.

 

Austan Kinnaird, 26, Goddard, Kan., pleaded guilty to two counts of robbery. In his plea he admitted that on Dec. 24, 2015, he robbed Golf Headquarters at 848 N. Webb Road in Wichita. He entered the store wearing a wig and a cap. He showed the clerk what looked like a firearm and demanded money before he fled the store with the stolen cash.

 

In his plea, he further admitted that on April 29, 2016, he robbed a branch of Intrust Bank in a Dillons grocery store at 9450 E. Harry in Wichita. He gave the teller a note demanding money and fled the bank with the cash. He was identified after surveillance photos were made public.

 

Beall commended the FBI, the Wichita Police Department and Assistant U.S. Attorney Jason Hart for their work on the case.

WASHINGTON — A federal court in Kansas City, Kansas has permanently barred Everett Bias and Integrity Solutions Tax Consultants Inc. (ISTC) from preparing federal tax returns for others, the Justice Department announced today.

 

In its complaint, the government alleged that Bias and ISTC prepared false returns for customers located in both Kansas City, Kansas and Kansas City, Missouri. In addition to barring the defendants from preparing tax returns, the court ordered the defendants to contact all customers for whom they prepared federal tax returns since 2014 to inform them of the permanent injunction and provide the United States with a list of all of these persons.

 

According to the government’s complaint, Bias and ISTC unlawfully prepared federal tax returns that lowered their customers’ federal tax liabilities by using S corporations. This type of corporation passes corporate income, losses, deductions, and credits to its shareholders for federal tax purposes. Shareholders report the flow-through of income and losses on their personal tax returns and are assessed tax at their individual income tax rates. According to the government’s complaint, Bias and ITSC:

 

• Failed to report S corporation pass-through income as taxable income on the customers’ personal income tax returns;
• Falsely lowered the income of customers’ S corporations and then reported that false lowered income amount on the customers’ personal income tax returns;
• Improperly double-deducted customers’ personal expenses, such as mortgage interest and real estate taxes, on customers’ corporate and personal returns; and
• Concocted S corporations in order to improperly deduct customers’ personal expenses as business expenses and lower pass through income or create a phony flow through loss.

 

The government similarly alleged that Bias and ISTC concocted businesses for customers claiming that they were sole proprietors -- which are required to report its profit or loss on a Schedule C (Form 1040, Schedule C, “Profit or Loss from Business”) to the income tax return -- then fabricated the income and expenses of the fictitious business to show a loss, which falsely lowered their customers’ taxable income. Finally, the government alleged that Bias and ISTC fabricated itemized deductions such as unreimbursed employee business expenses and medical/dental expenses on their customers’ personal tax returns.

 

Return preparer fraud was one of the IRS’s Dirty Dozen Tax Scams for 2017 and taxpayers seeking a return preparer should remain vigilant. The IRS has some tips on their website for choosing a tax preparer and has launched a free directory of federal tax preparers.

 

In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.

 

WICHITA, KAN. – A Wichita woman was indicted Tuesday on federal charges of providing a gun to a man who is charged with shooting and killing three people near Moundridge, Kan., U.S. Attorney Tom Beall said.

 

Myrta M. Rangel, 31, Wichita, is charged with:

 

• One count of aiding and abetting possession of a firearm in furtherance of drug trafficking (count one).

• One count of possessing a firearm in furtherance of drug trafficking (count two).

• One count of conspiracy to carry a firearm in furtherance of drug trafficking (count three).

• One count of transferring a firearm to be used in drug trafficking (count four).

• One count of unlawful possession of a firearm following a felony conviction (count five).

• One count of giving a firearm to a convicted felon (count six).

 

It is alleged that on Oct. 29, 2016, Rangel gave a .40 caliber handgun to Jereme Nelson. Nelson is charged in Harvey County District Court with killing three people: Travis Street, Angela May Graevs and Richard Prouty.

 

If convicted, she faces the following penalties:

• Count one: Not less than 10 years and a fine up to $250,000.

• Count two: Not less than five years and a fine up to $250,000.

• Count three: Up to 20 years and a fine up to $250,000.

• Counts four, five and six: Up to 10 years and a fine up to $250,000.

 

The Kansas Bureau of Investigation and the Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Matt Treaster is prosecuting.

 

 

OTHER INDICTMENTS

 

Jack E. Smith, 37, Scammon, Kan., is charged with unlawfully trying to dispose of dispose of hazardous waste by setting fire to it.

 

Smith is charged with one count of unlawfully transporting hazardous waste and one count of unlawfully disposing of hazardous waste in violation of the Resource Conservation Recovery Act.

 

The indictment alleges that Smith towed a panel truck containing polymers and paints used in the making of gymnasium floors to property owned by his uncle in Crawford County, Kan. Neither he nor his uncle had a permit to transport, store or dispose of hazardous waste. Smith is alleged to have attempted to dispose of the hazardous waste by setting fire to the truck.

 

If convicted, he faces up to five years in federal prison and a fine up to $250,000. The Environmental Protection Agency investigated. Assistant U.S. Attorney Alan Metzger is prosecuting.

 

Jeffrey Shock, 37, Wichita, Kan., is charged with escaping from federal custody at Mirror, Inc., 3820 Toben, Wichita. Kan. The crime occurred on April 2, 2017.

 

If convicted, he faces up to five years in federal prison and a fine up to $250,000. The U.S. Marshals Service investigated. Assistant U.S. Attorney Lanny Welch is prosecuting.

 

Verlarina Ruth Collins, 50, Winfield, Kan., is charged with one count of failing to report to serve a 45-month federal prison sentence. The crime occurred April 7, 2017.

 

If convicted, she faces a penalty of up to five years and a fine up to $250,000. The U.S. Marshals Service investigated. Assistant U.S. Attorney Brent Anderson is prosecuting.

 

Serafin Alegria-Zamora, 35, a citizen of Mexico, is charged with one count of unlawfully re-entering the United States after being deported, two counts of misusing a Social Security number and one count of aggravated identity theft. He was found April 11, 2017, in Sedgwick County, Kan.

 

If convicted, he faces up to two years and a fine up to $250,000 on the re-entry charge, up to five years and a fine up to $250,000 on each Social Security count and a mandatory two years (consecutive) on the identity theft count. Homeland Security Investigations investigated. Assistant U.S. Attorney Brent Anderson is prosecuting.

 

Sergio Roberto Garcia-Buezo, 31, a citizen of Honduras, is charged with unlawfully re-entering the United States after being deported. He was found Feb. 19, 2017, in Grant County, Kan.

 

If convicted, he faces up to two years in federal prison and a fine up to $250,000. Immigration and Customs Enforcement’s Enforcement Removal Operations investigated. Assistant U.S. Attorney Brent Anderson is prosecuting.

 

Juan Flores-Rivera, 34, a citizen of Mexico, is charged with unlawfully re-entering the United States after being deported. He was found April 17, 2017, in Butler County, Kan.

 

If convicted, he faces up to two years in federal prison and a fine up to $250,000. Immigration and Customs Enforcement’s Enforcement Removal Operations investigated. Assistant U.S. Attorney Brent Anderson is prosecuting

 

Darnell Wilks, 48, Garden City, Kan., is charged with one count of unlawful possession of a firearm following a felony conviction. The crime is alleged to have occurred March 18, 2017, in Finney County, Kan.

 

If convicted, he faces up to 10 years in federal prison and a fine up to $250,000. Assistant U.S. Attorney Matt Treaster is prosecuting.

 

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

WICHITA, KAN. - A Coffey County man pleaded guilty Friday to using a PlayStation video game console to obtain child pornography, U.S. Attorney Tom Beall said.

 

Michael L. Stratton, 30, Burlington, Kan., pleaded guilty to one count of receiving child pornography. In his plea, he admitted using a PlayStation 3 to chat about child pornography and trade child pornography.

 

According to court documents, Sony monitors user activities on the PlayStation Network. The network allows account holders to communicate in a way similar to text and emails. A user complained to Sony about Stratton, who was sending messages using the name Susan_14. Sony sent reports to the National Center for Missing and Exploited Children, which identified child pornography that Stratton had downloaded. Sony also determined that Stratton had sent messages to other users including: “u want to see naked kids tonight,” and “Friend Request. Do you have child porn?”

 

Sentencing is set for Aug. 7. The parties have agreed to recommend a sentence of five years in federal prison. Beall commended the FBI and Assistant U.S. Attorney Christine Kenney for their work on the case.

TOPEKA, KAN.  - A Topeka woman was sentenced Wednesday to 30 months in federal prison for billing Medicaid for services she did not provide to developmentally disabled adult patients, U.S. Attorney Tom Beall and Kansas Attorney General Derek Schmidt announced today. She was ordered to pay more than $480,000 in restitution.

 

Kristina Hansel, 45, Topeka, Kan., pleaded guilty in November 2016 in federal court in Topeka to one count of conspiracy to commit health care fraud. The crimes occurred while Hansel owned and operated Achieve Services, LLC, which was licensed to provide day and residential services to developmentally disabled adults.

 

In her plea, Hansel admitted the following:

 

• Billing Medicaid for services not provided.

• Providing false and fraudulent documentation, or no documentation at all.

• Making false and fraudulent statements to obtain and renew her license.

• Failing to hire a Registered Nurse or a License Practical Nurse to provide medical services, including medication administration.

 

Hansel also admitted that in one case she withheld medical treatment from a patient and directed others to help her cover up medication overdoses so licensing authorities would not learn of the problem.

 

The case was jointly investigated by federal and state authorities and prosecuted by the Kansas Attorney General’s Medicaid Fraud and Abuse Division.

WICHITA, KAN. - A Wichita man who held a jewelry store owner at gunpoint was sentenced Wednesday to 12 years in federal prison, U.S. Attorney Tom Beall said.

 

Terence L. Thomas, 25, Wichita, Kan., pleaded guilty to one count of brandishing a firearm during a jewelry store robbery and one count of bank robbery in a separate incident

 

In the jewelry store robbery, Thomas admitted he had a knife when he approached the owner of Kim Chee Jewelry at 2038 N. Broadway as the owner and his wife arrived for work. The owner drew a handgun in self-defense. The two men wrestled and shots were fired before Thomas got the gun. He forced the owner to open the door to the business. When Thomas tried to drag the owner’s wife into the business, she fell to the ground, feigning a heart attack. Thomas fled the scene after the owner locked him out of the business. A witness took photos of Thomas’ car as he fled, which helped police to identify Thomas and arrest him.

 

In a separate incident a month earlier, Thomas robbed the Fidelity Bank at 3525 E. Harry. He told the teller, “This is a robbery,” and counted down from twenty while the teller put cash in his bag. He fled the bank with the money.

 

Beall commended the Wichita Police Department, FBI and Assistant U.S. Attorney Jason Hart for their work on the case.

 

WICHITA, KAN. - Two Wichita men were sentenced Thursday to seven years in federal prison in connection with an armed robbery at a Wichita bank, U.S. Attorney Tom Beall said.

 

Raishat McGill, 35, Wichita, Kan., and Elijah Shelton, 26, Wichita, Kan., pleaded guilty to one count each of brandishing a firearm in a crime of violence. In their pleas, they admitted that on June 13, 2016, they robbed the Carson Bank at 4461 E. Douglas in Wichita. On that day, two individuals who were disguised entered the bank, one of them brandishing a firearm. The robbers demanded and received money before fleeing. The money they received contained a global positioning device that police used to track the defendants and arrest them.

 

Earlier this week, co-defendant Andre Bryant, 30, Wichita, Kan., was sentenced to seven years in the case.

 

Beall commended the Safe Streets Task Force, including the FBI, the Wichita Police Department and the Sedgwick County Sheriff’s Department, as well as Assistant U.S. Attorney Aaron Smith for their work on the case.

 

KANSAS CITY, KAN. - A federal grand jury here today returned additional charges against a Lindsborg man accused of traveling to a foreign country to have sex with minors, U.S. Attorney Tom Beall said.

 

Anthony Shultz, 54, Lindsborg, Kan., is accused of traveling to the Philippines, where he engaged in sex with minors, produced videos of sex acts with minors and distributed them on the internet. The case began in April 2016 when the FBI received a tip that a U.S. citizen was sexually abusing minors in the Philippines, producing live-streaming videos and distributing videos via the internet to users who paid to see them. Investigators followed an electronic trail to Shultz, who was a commercial pilot and owned a home in Lindsborg. He initially was charged in July 2016.

 

Schultz is charged with the following counts:

 

Count one: Engaging in illicit sexual conduct in a foreign place with a minor victim (victim 1).

Count two: Production of child pornography (victim 1).

Count three: Sex trafficking of children (new count, victim 1).Count four: Engaging in illicit sexual conduct in a foreign place with a minor victim (new count, victim 2).

Count five: Production of child pornography (new count, victim 2).

Count six: Sex trafficking of children (new count, victim 2).

Count seven: Production of child pornography (new count, victim 3).

Count eight: Selling or buying of children (new count, victim 3).

Count nine: Distribution of child pornography.

Count 10: Possession of child pornography (new count).

Count 11: Identity theft

 

Upon conviction, the crimes carry the following penalties:

Counts one and four: Not less than five years and not more than 30 years in federal prison and a fine up to $250,000.Counts two and five: Not less than 15 years and not more than 30 years and a fine up to $250,000.

Counts three and six: Not less than 15 years and a fine up to $250,000.Count seven: Not less than 15 and not more than 30 years and a fine up to $250,000.

Count eight: Not less than 30 years and a fine up to $250,000.Count nine: Not less than five years and not more than 20 years and a fine up to $250,000.

Count 10: Not more than 10 years and a fine up to $250,000.

Count 11: Up to five years and a fine up to $250,000.

 

The FBI and investigated. Assistant U.S. Attorney Jason Hart and Elly Pierson, a trial attorney with the Justice Department’s Child Exploitation and Obscenity Section, are prosecuting.

 

OTHER INDICTMENTS

 

 

Cesar Humberto Melandez-Morales, 28, a citizen of Mexico, is charged with unlawful possession of a firearm while in the United States. The crime is alleged to have occurred April 5, 2017, in Lincoln County, Kan.

 

If convicted, he faces up to 10 years in federal prison and a fine up to $250,000. The Kansas Highway Patrol and ICE Enforcement and Removal Operations investigated. Assistant U.S. Attorney Brent Anderson is prosecuting.

 

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

WICHITA, KAN. - A Wichita man was sentenced Monday to seven years in federal prison for his part in robbing a local bank, U.S. Attorney Tom Beall said.

 

Andre Bryant, 30, Wichita, Kan., pleaded guilty to one count of aiding and abetting or brandishing a firearm in a crime of violence. In his plea, he admitted that on June 13, 2016, he and co-defendants robbed the Carson Bank at 4461 E. Douglas in Wichita. Two individuals who were disguised entered the bank, one of them brandishing a firearm. They demanded and received money before fleeing. The money they received contained a global positioning device that police used to track Bryant and the co-defendants and arrest them.

 

Co-defendants Raishat Magill and Elijah Shelton are set for sentencing Thursday.

 

Beall commended the Wichita Police Department, the Sedgwick County Sheriff’s Department, the FBI and Assistant U.S. Attorney Aaron Smith for their work on the case.

 

WICHITA, KAN. - A Wichita man who used a stolen identity to take out a $43,000 car loan was sentenced Monday to 45 months in federal prison, U.S. Attorney Tom Beall said.

 

Jacob Michael Martin, 32, Wichita, pleaded guilty to one count of bank fraud and one count of aggravated identity theft. In his plea, Martin admitted he used another man’s identity when he went to CarMax and applied for a loan to buy a 2012 Jaguar. As a result, Wells Fargo Bank issued a loan of $43,599.47 in the victim’s name. Martin presented a counterfeit Kansas driver’s license with his own picture and the name of the victim. He also gave the lender the victim’s Social Security number.

 

Martin is one of 13 people charged in an indictment filed in May 2016 alleging the conspirators worked together to steal mail from mailboxes, forge identification documents, obtain fraudulent credit cards and shop with stolen identities.

 

Beall commended the U.S. Postal Inspection Service, the Sedgwick County Sheriff’s Department, the Wichita Police Department, the Bureau of Alcohol, Tobacco, Firearms and Explosives and Assistant U.S. Attorney Alan Metzger for their work on the case.

KANSAS CITY, KAN. - A former federal prison guard was sentenced Monday to three years in federal prison for taking bribes to smuggle tobacco to inmates, U.S. Attorney Tom Beall said.

 

Marc Buckner, 47, Kansas City, Kan., pleaded guilty to one count of a public official accepting bribes. In his plea, he admitted the crimes occurred while he worked as a guard at Leavenworth Penitentiary. Buckner said he was paid each time he smuggled tobacco into the prison. He hid tobacco and rolling papers in two handmade insoles in his shoes.

 

Inmates paid Buckner $750 for each can of Bugler brand tobacco and rolling papers he smuggled. He said he smuggled tobacco once or twice a month for years.

 

Beall commended the FBI and Assistant U.S. Attorney Jabari Wamble for their work on the case.

WICHITA, KAN. - Two Kansas men were charged Thursday with shooting and killing a golden eagle, U.S. Attorney Tom Beall said.

 

Michael Dusin, 22, Phillipsburg, Kan., and Elijah J. Kuhlman, 22, Sharon Springs, Kan., are charged with violating the federal Bald and Golden Eagle Protection Act. According to court documents, it is alleged the two defendants were driving around in Wallace County when they saw what they later described as a large, black bird. Dusin told Kuhlman to back up so he could take a shot at the bird. Dusin shot the bird and it fell to the ground.

 

On Dec. 12, 2016, a natural resource officer with the Kansas Department of Wildlife, Parks and Tourism investigating a report of a dead Eagle found the eagle’s remains in a field and two spent shotgun shells in the road. With the help of the Wallace County Sheriff, investigators identified a Ford F-150 pickup belonging to Kuhlman that had been seen in the area. An autopsy performed at the U.S. Fish and Wildlife Services’ Wildlife Forensics Laboratory in Ashland, Ore., confirmed the Eagle’s remains contained 41 metal pellets.

 

If convicted, the defendants face up to a year in federal prison and a fine up to $100,000. The Kansas Department of Wildlife, Parks and Tourism, the Wallace County Sheriff and U.S. Fish and Wildlife Service investigated. Assistant U.S. Attorney Matt Treaster is prosecuting.

 

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

KANSAS CITY, KAN. - A Topeka man has been arrested and charged in two robberies, U.S. Attorney Tom Beall said Friday.

 

The Topeka Police Department assisted the FBI in arresting Joshua Alexander Musgraves, 24, Topeka, Kan., who is charged with two counts of commercial robbery. An indictment filed in U.S. District court in Topeka alleges that on Jan. 6, 2017, Musgraves robbed Plato’s Closet, a clothing store at 1580 S.W. Wanamaker Road in Topeka. The indictment also alleges that on Jan. 20, 2017, Musgraves robbed Kentucky Fried Chicken at 1812 N.W. Topeka Boulevard in Topeka.

 

If convicted, he faces up to 20 years in federal prison and a fine up to $250,000 on each count. The Topeka Police Department and the FBI investigated. Assistant U.S. Attorney Jared Maag is prosecuting.

 

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

TOPEKA, KAN. – A grand jury Wednesday returned a new indictment against Topeka developer Kent Douglas Lindemuth charging him with lying under oath in an effort to hide assets in a bankruptcy, U.S. Attorney Tom Beall said.

 

Lindemuth, 65, Topeka, Kan., was charged with one count of perjury. Wednesday’s indictment brings the number of federal criminal charges against Lindemuth to 114 counts, including bankruptcy fraud, money laundering, and possession of firearms and ammunition while under indictment. Lindemuth initially was charged in June 2016 in an indictment accusing him of hiding assets after he filed for Chapter 11 bankruptcy protection in November 2012.

 

The new count alleges Lindemuth committed perjury on Jan. 7, 2013, when he testified under oath at a hearing held by a court-appointed bankruptcy trustee. After being placed under oath by an attorney for the U.S. Trustee Program, Lindemuth stated he had reported all his assets as the law required. He also stated that he would notify his attorney of any changes.

 

The indictment alleges that at the time he made the statements he was concealing assets, including: An Envista Credit Union account, a US Bank account, a revenue stream of more than $1 million, and firearms with a value of more than $1 million.

 

Upon conviction, the crimes carry the following penalties:

Perjury: A maximum penalty of five years in federal prison and a fine up to $250,000.

Bankruptcy fraud: A maximum penalty of five years in federal prison and a fine up to $250,000.

Money laundering: Up to 10 years and a fine up to $250,000.

Unlawful possession of firearms and ammunition: Up to 10 years and a fine up to $250,000.

 

The FBI investigated. Assistant U.S. Attorney Rich Hathaway is prosecuting is prosecuting.

 

WICHITA, KAN. - A Clearwater woman was sentenced Wednesday to four years in federal prison on a drug trafficking charge, U.S. Attorney Tom Beall said.

 

Kraysalias Lynn Bernhardt, 21, Clearwater Kan., pleaded guilty to one count of using a telephone in furtherance of drug trafficking. In her plea, she admitted that on Jan. 16, 2016, she talked by phone with co-defendant Samuel Below, who was being held in the Sedgwick County Jail. Below told her to sell methamphetamine that he was storing at her residence. Following his direction, she sold a pound of meth.

 

Below was sentenced in December to 10 years in federal prison.

 

Beall commended the U.S. Postal Inspection Service, the Sedgwick County Sheriff’s Department, the Wichita Police Department, the Bureau of Alcohol, Tobacco, Firearms and Explosives investigated and Assistant U.S. Attorney Alan Metzger for their work on the case.

KANSAS CITY, KAN. - An Olathe man pleaded guilty Tuesday to stealing more than $275,000 in merchandise while he was working for a store that catered to runners, U.S. Attorney Tom Beall said.

 

Craig W. Sullivan, 41, Olathe, Kan., pleaded guilty to one count of wire fraud. In his plea, he admitted the crime occurred while he worked for Garry Gribble’s Running Sports, which has five locations in the Kansas City area. Sullivan oversaw merchandise arriving at the main store in Overland Park. He was responsible for distributing merchandise to the other locations.

 

In his plea, Sullivan admitted he stole merchandise – primarily Garmin GPS devices – and sold them to a buyer in California via Craigslist. The buyer used PayPal to send Sullivan 51 payments totaling $275,780.

 

Sentencing is set for July 10. Sullivan faces up to 20 years in federal prison and a fine up to $250,000. Beall commended the U.S. Postal Service and Assistant U.S. Attorney Chris Oakley for their work on the case.

 

KANSAS CITY, KAN. -  A Mexican citizen unlawfully in the United States was sentenced Monday to 420 months for drug trafficking, U.S. Attorney Tom Beall said.

 

In July 2016, a federal court jury found Juan Antonio Herrera-Zamora, 33, guilty on one count of attempted possession with intent to sell methamphetamine, one count of possession with intent to sell methamphetamine and one count of unlawful possession of a firearm in furtherance of drug trafficking.

 

During trial, prosecutors presented evidence that Herrera-Zamora gave instructions via telephone to two men who drove 26 pounds of methamphetamine to Kansas from Oklahoma hidden in a spare tire of their car.

 

Herrera-Zamora met the men at a Super 8 in Lenexa. His girlfriend accompanied him and there was a baby in the backseat of his car. He hid a gun in the baby’s diaper bag. He took the keys to the car and drove it to a tire shop in Kansas City, Kan., where the tire was removed and cut open. He was arrested at that location.

 

Herrera-Zamora filed a sentencing memorandum seeking a lesser sentence and citing his upbringing in Guasave, Sinaloa, Mexico. “Mr. Herrera-Zamora comes from a low-income background and realized a great accomplishment by coming to this country when he was about thirteen years old,” the memo said.

 

Prosecutors cited Herrera-Zamora’s criminal record, starting with a conviction at 17 on two counts of theft and a later drug conviction, followed by twice being deported.

 

Beall commended the Drug Enforcement and Assistant U.S. Attorney David Zabel for their work on the case.

KANSAS CITY, KAN. - A Kansas City man was sentenced Monday to 63 months in federal prison for robbing a bank in Prairie Village, Kan., U.S. Attorney Tom Beall said.

 

Darrell Hunter, 51, Kansas City, Mo., pleaded guilty to one count of bank robbery. He admitted that on Dec. 26, 2014, he robbed United Missouri Bank at 6900 Mission Road in Prairie Village

 

In his plea, Hunter admitted he entered the bank and asked for a deposit slip. He wrote on the slip, “This is a robbery I got a gun put the money in the bag.” He put the money in a duffle bag and left the bank.

 

Beall commended the FBI, the Prairie Village Police Department and Assistant U.S. Attorney Tris Hunt for their work on the case.

WICHITA, KAN. – A Parsons woman was indicted Tuesday on federal charges of embezzling more than $5 million from a credit union that was declared insolvent and liquidated, U.S. Attorney Tom Beall said.

 

Nita Rae Nirschl, 64, Parsons, Kan., is charged in an 81-count indictment including 22 counts of embezzlement, 37 counts of money laundering, 18 counts of interstate transportation of stolen property and four counts of attempting to evade taxes. The indictment alleges the crimes took place while Nirschl worked for the Parsons Pittsburg Credit Union based in Parsons.

 

Following an audit that found the credit union was insolvent, the credit union was placed in conservatorship and ultimately liquidated in March 2014. The audit revealed that from 2010 to December 2014 Nirschl embezzled more than $5 million from the credit union. The indictment alleges she deposited money stolen from the credit union into her personal accounts. She withdrew the funds as cash from ATMs at Harrah’s North Kansas City casino, the Buffalo Run casino in Miami, Okla., the Stables casino in Miami, Okla., the Downstream casino in Quapaw, Okla., Harrah’s News Orleans casino and Harrah’s Lake Tahoe casino.

 

Upon conviction, the crimes carry the following penalties:

Embezzlement by a credit union employee: Up to 30 years in federal prison and a fine up to $1 million on each count.

Money laundering: Up to 10 years and a fine up to $250,000 on each count.

Interstate transportation of stolen property: Up to 10 years and a fine up to $250,000 on each count.

Attempt to evade taxes: Up to five years and a fine up to $100,000.

 

The FBI and the Internal Revenue Service investigated. Assistant U.S. Attorney Lanny Welch is prosecuting.

 

OTHER INDICTMENTS

 

Six men from Mexico were indicted Tuesday in a case of alleged alien smuggling.

 

Adrian Guzman-Rojas, 19, a citizen of Mexico, was charged with one count of knowingly transporting Mexican citizens who were not lawfully in the United States.

 

In court documents, investigators alleged that on March 10, 2017, Guzman-Rojas was driving a 2012 Buick Enclave when the Kansas Highway Patrol stopped him on Interstate 70 near Ellsworth, Kan. It is alleged that five men in the car with Guzman-Rojas were Mexican citizens who previously had been deported and who had returned to the United States unlawfully.

 

Charged with one count each of illegally re-entering the United States are the following:

 

Mario Esqivel-Garduno, 38, Ernesto Galeno-Castillo, 36, Juan Gonzalez-Vicente, 20, Manuel Luna-Macin, 31, and Alejandro Villa-Maldonado, 27, all citizens of Mexico.

 

Investigators allege Guzman-Rojas was being paid by smugglers in Phoenix.

 

Upon conviction, the crimes carry the following penalties:

Unlawful transportation of undocumented aliens: Up to five years in federal prison and a fine up to$250,000.

Un-lawful re-entry: Up to two years and a fine up to $250,000.

 

The case was investigated by the Kansas Highway Patrol, Homeland Security Investigations and Enforcement and Removal Operations, and is being prosecuted by Assistant U.S. Attorney Brent Anderson.

 

Shannon Marie Grub, 34, Wichita, Kan., is charged with one count of unlawful possession of a firearm in furtherance of drug trafficking, two counts of possession with intent to distribute methamphetamine, and one count of unlawful possession of a firearm by a user of controlled substances. The crimes are alleged to have occurred in May and September 2016 in Wichita.

 

Upon conviction, the crimes carry the following penalties:

Unlawful possession of a firearm in furtherance of drug trafficking: Not less than five years in federal prison and a fine up to $250,000.

Possession with intent to distribute: Not less than five years and not more than 40 years and a fine up to $2 million.

Unlawful possession of a firearm by a user of controlled substances: up to 10 years and a fine up to $250,000.

 

The Wichita Police Department investigated. Assistant U.S. Attorney Matt Treaster is prosecuting.

 

Marquez I. Garcia, 32, Wichita, Kan., is charged with one count of unlawful possession of ammunition following a felony conviction. The crimes are alleged to have occurred Dec. 21, 2016, in Sedgwick County, Kan.

 

If convicted, he faces up to 10 years in federal prison and a fine up to $250,000. The Wichita Police Department investigated. Assistant U.S. Attorney Lanny Welch is prosecuting.

 

Randy J. Johnson, 31, Wichita, Kan., is charged with one count of unlawful possession of a firearm following a felony conviction. The crime is alleged to have occurred Jan. 13, 2015, in Sedgwick County, Kan.

 

If convicted, he faces up to 10 years in federal prison and a fine up to $250,000, The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney David Lind is prosecuting.

 

 

Oscar Humberto Beltran-Ramirez, 37, Jorge Urquidez-Navarro, 42, and Hector Manuel Gomez-Panduro, 34, are charged with one count each of possession with intent to distribute methamphetamine. In addition, Urquidez-Navarro is charged with knowingly transporting an illegal alien. The crimes are alleged to have occurred March 22, 2017, in Sedgwick County, Kan.

 

Up conviction, the drug charge carries a penalty of not less than 10 years in federal prison and a fine up to $10 million. The transporting charge carries a penalty of up to five years and a fine up to $250,000. The Drug Enforcement Administration investigated. Special Assistant U.S. Attorney Brent Anderson is prosecuting.

 

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct

KANSAS CITY, KAN. – Jacob L. Smith, 19, Kansas City, Kan., was sentenced Monday to 300 months in federal prison for a bank robbery in which he shot at law enforcement officers during a high-speed chase, U.S. Attorney Tom Beall said. Co-defendant Danille Morris, 27, Kansas City, Kan., whose 19-month child was with her in the getaway car, was sentenced to 200 months.

 

Smith pleaded guilty to one count of bank robbery and one count of brandishing a firearm. Morris pleaded guilty to one count of bank robbery, one count of brandishing a firearm and one count of unlawfully possessing a firearm following a felony conviction.

 

In his plea, Smith admitted that on March 9, 2016, he and co-defendant Gary Jordan, 40, Kansas City, Kan., brandished handguns when they entered the First National Bank at 7460 W. 199th Street in Stilwell, Kan. They held tellers at gunpoint before fleeing with cash stuffed in a backpack. Jordan took the wheel of the getaway car.

 

During the next 25 minutes, the robbers were pursued by the Kansas Highway Patrol, the Leawood Police Department and other law enforcement agencies as they fled across the Kansas/Missouri state line. During the chase, Smith fired at officers six times from the car. After the car overturned on a sharp turn, the defendants were arrested. Throughout the chase, Morris and her 19-month-old child were in the car.

 

Beall commended all the agencies that assisted in the investigation including the FBI, the Johnson County Sheriff’s Office, the Kansas Highway Patrol, the Leawood Police Department, the Kansas City, Kan., Police Department and the Kansas City, Mo., Police Department, as well as the prosecutor, Assistant U.S. Attorney Chris Oakley.

WICHITA, KAN. – A woman from Peru who came to the United States in 2005 on a visitor’s visa and stayed has been charged in federal court here with identity theft and document fraud, U.S. Attorney Tom Beall said today.

 

The woman, Jennifer Leyva, 35, who has lived in Wichita since at least 2013, is alleged to have used at least three different identities to get jobs at several Wichita-area businesses. She was arrested Tuesday by agents of the Kansas Department of Labor and Homeland Security Investigations, who investigated the case, and she was scheduled to make an initial court appearance Wednesday before U.S. Magistrate Judge Gwynne E. Birzer.

 

A federal grand jury indicted Leyva March 16 on 10 counts, including two counts of aggravated identity theft, two counts of identity document fraud, two counts of lying of an I-9 Employment Eligibility Verification form, and four counts of misuse of a Social Security number. The charges relate to the defendant’s employment at health care-related businesses in Wichita.

 

If convicted, the defendant faces up to five years in prison and a $250,000 fine on each count. Assistant U.S. Attorney Brent Anderson is prosecuting. As in any criminal case, defendants are presumed innocent until and unless proven guilty.

KANSAS CITY, KAN. – An Overland Park man pleaded guilty Monday to distributing child pornography on the Internet while posing as a 46-year-old woman, U.S. Attorney Tom Beall said.

 

Frank Joseph Kurtz, 70, Overland Park, Kan., pleaded guilty to one count of distributing child pornography. In his plea, he admitted that an investigation by the Israeli National Police first identified emails in which Kurtz used the alias “Lisayearning46” to send child pornography to another person. The FBI in Kansas followed an electronic trail to Kurtz, who registered with Yahoo under the name “Lisa Lewis” and used photos he found on the Internet as his profile picture.

 

Kurtz is scheduled for sentencing July 10. Both parties have agreed to recommend a sentence of 97 months in federal prison. Beall commended the FBI, the Heart of America Regional Computer Forensics Laboratory and Assistant U.S. Attorney Kim Flannigan for their work on the case.

 

KANSAS CITY, KAN. – A Miami County man pleaded guilty Monday to robbing a bank in Overland Park, U.S. Attorney Tom Beall said.

 

Paul A Sundquist, 29, Louisburg, Kan., pleaded guilty to one count of bank robbery. In his plea, he admitted that on Sept. 19, 2016, he robbed the Stanley Bank, 7835 W.151st in Overland Park, Kan. Sundquist showed a clerk a note demanding money before receiving the cash and fleeing the bank. A bystander got a partial tag number on Sundquist’s pickup truck. Sundquist was monitoring police radio traffic on his cell phone. When he heard police had his tag number he called 911 and surrendered.

 

Sentencing will be set for a later date. He faces up to 20 years and a fine up to $250,000.

 

Beall commended the FBI, the Overland Park Police Department and Assistant U.S. Attorney Terra Morehead for their work on the case.

Defendants Allegedly Prepare Fraudulent Tax Returns in Order To Understate Customers’ Tax Or Overstate Their Refunds

 

A tax return preparer and his preparation business in the Kansas City, Kansas area prepare fraudulent tax returns for their customers, according to a new civil lawsuit filed by the Justice Department today. The suit, filed in federal court in Kansas City, Kansas, asks the court to permanently bar Everett Bias and the company he owns and operates called Integrity Solutions Tax Consultants Inc. (ISTC) from preparing federal tax returns for others. The government also asks the court to order Bias and ISTC to turn over the names of customers for whom they have prepared federal tax returns since 2012.

 

The complaint alleges that the defendants unlawfully understate their customers’ income tax liabilities and overstate these customers’ refunds. According to the complaint, Bias and ISTC unlawfully prepare federal tax returns that lower their customers’ federal tax liabilities by using S corporations. This type of corporation passes corporate income, losses, deductions, and credits to its shareholders for federal tax purposes. Shareholders report the flow-through of income and losses on their personal tax returns and are assessed tax at their individual income tax rates. According to the government’s complaint, Bias and ITSC misreport S Corporation items on their customers’ personal income tax returns by:

 

• Failing to report customers’ pass-through income as taxable income on the customers’ personal income tax returns;

• Falsely lowering the income of customers’ S corporations and then reporting that false lowered income amount on the customers’ personal income tax returns;

• Improperly double-deducting customers’ personal expenses, such as mortgage interest and real estate taxes, on customers’ corporate and personal returns; and

• Preparing and filing tax returns for fictitious S corporation businesses in order to improperly deduct customers’ personal expenses as business expenses.

 

According to the complaint, Bias and ISTC also allegedly fabricate itemized deductions on their customers’ personal tax returns, such as unreimbursed employee business expenses and medical/dental expenses, to fraudulently reduce their customers’ taxable income. Furthermore, the government alleges that Bias and ISTC similarly assert that some customers operate a business as a sole proprietorship, which is required to report its profit or loss on a Schedule C (Form 1040, Schedule C, “Profit or Loss from Business”) to the income tax return. According to the complaint, Bias and ISTC allegedly fabricate the income and expenses of the fictitious business to show a loss, which falsely lowers their customers’ taxable income.

 

According to the complaint, the Internal Revenue Service (IRS) has examined 200 tax returns prepared by Bias and ISTC and calculated a tax loss to the government of at least $828,506. The complaint alleged that out of these 200 tax returns, the IRS examined 130 personal tax returns. The IRS found that the defendants understated their customers’ liabilities or overstated their refund on 117 of the 130 personal tax returns (90 percent), according to the complaint.

 

Return preparer fraud is one of the IRS’s Dirty Dozen Tax Scams for 2017 and taxpayers seeking a return preparer should remain vigilant. The IRS has some tips on their website for choosing a return preparer and has launched a free directory of federal tax preparers.

 

In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.

WASHINGTON – Diego Martinez, 28, pleaded guilty yesterday to making false statements to the FBI during a federal hate crime investigation arising from a June 19, 2015, bias-motivated assault of three black Somali men in Dodge City, Kansas. Martinez pleaded guilty in the District of Kansas to one count of making materially false statements to the FBI during an October 2015 voluntary interview.

 

During the plea hearing, Martinez admitted that, during the interview, he had provided the FBI with a false alibi for the time of the assault—specifically, that although he had told the FBI that he had been with an unknown woman at the time that the Somali men were attacked, this alibi was false. He further admitted that he falsely told the FBI that his cell phone had stopped working shortly after the assault, when, in fact, Martinez had used his phone to contact, and to attempt to contact, one of the men who perpetrated the attack. Martinez admitted that he knew these statements were false at the time he made them to the FBI, and that they were material to the FBI’s investigation into the attack.

 

“Hate violence not only harms individuals but also threatens the diversity of our society and the well-being of our communities,” said Acting Assistant Attorney General Tom Wheeler for the Justice Department’s Civil Rights Division. “The Justice Department will continue to vigorously prosecute hate crimes, and to pursue defendants who, like Mr. Martinez, obstruct the investigations into those crimes.”

 

Martinez will be sentenced on June 1, 2017, and faces a maximum sentence of 5 years in prison.

 

This case was investigated by the FBI’s Garden City Resident Agency with assistance from the Dodge City Police and the Ford County, Kansas, Sheriff’s Departments. The case is being prosecuted by Trial Attorney Risa Berkower and Special Litigation Counsel Jared Fishman of the Civil Rights Division’s Criminal Section, with assistance from Assistant U.S. Attorney Mona Furst of the District of Kansas.

Diego Martinez, 28, pleaded guilty yesterday to making false statements to the FBI during a federal hate crime investigation arising from a June 19, 2015, bias-motivated assault of three black Somali men in Dodge City, Kansas. Martinez pleaded guilty in the District of Kansas to one count of making materially false statements to the FBI during an October 2015 voluntary interview.

 

During the plea hearing, Martinez admitted that, during the interview, he had provided the FBI with a false alibi for the time of the assault—specifically, that although he had told the FBI that he had been with an unknown woman at the time that the Somali men were attacked, this alibi was false. He further admitted that he falsely told the FBI that his cell phone had stopped working shortly after the assault, when, in fact, Martinez had used his phone to contact, and to attempt to contact, one of the men who perpetrated the attack. Martinez admitted that he knew these statements were false at the time he made them to the FBI, and that they were material to the FBI’s investigation into the attack.

 

“Hate violence not only harms individuals but also threatens the diversity of our society and the well-being of our communities,” said Acting Assistant Attorney General Tom Wheeler for the Justice Department’s Civil Rights Division. “The Justice Department will continue to vigorously prosecute hate crimes, and to pursue defendants who, like Mr. Martinez, obstruct the investigations into those crimes.”

 

Martinez will be sentenced on June 1, 2017, and faces a maximum sentence of 5 years in prison.

 

This case was investigated by the FBI’s Garden City Resident Agency with assistance from the Dodge City Police and the Ford County, Kansas, Sheriff’s Departments. The case is being prosecuted by Trial Attorney Risa Berkower and Special Litigation Counsel Jared Fishman of the Civil Rights Division’s Criminal Section, with assistance from Assistant U.S. Attorney Mona Furst of the District of Kansas.

Ahmed el-Sherif, the owner/operator and radiation safety officer for Beta Chem Laboratory in Lenexa, Kansas, was charged today with illegally storing hazardous waste and obstructing an agency proceeding, announced Acting Assistant Attorney General Jeff Wood for the Justice Department’s Environment and Natural Resources Division, U.S. Attorney Tom Beall for the District of Kansas, and Jessica Taylor, Director of the Criminal Investigation Division of the U.S. Environmental Protection Agency (EPA).

According to allegations contained in the two-count indictment:

El-Sherif, 61, a chemist, started Beta Chem in the mid-1990s, which he owned and operated. Beta Chem used radioactive Carbon-14 and solvents in the operation, under license by the Kansas Department of Health and Environment (KDHE). KDHE has assumed certain regulatory authority from the U.S. Nuclear Regulatory Commission under the Atomic Energy Act. In September 2005, KDHE performed an inspection of Beta Chem and discovered extensive radioactive contamination in the laboratory, and the next day issued an Emergency Order of Suspension of License. U.S. EPA conducted a hazardous waste inspection the same month, and subsequently notified el-Sherif of hazardous waste violations under the Resource Conservation and Recovery Act (RCRA). During the ensuing years, KDHE communicated with el-Sherif about the radioactive contamination at Beta Chem. On October 4, 2013, after issuing an Emergency Order to Seize and Secure Radioactive Materials, KDHE took control of Beta Chem and secured the facility.

The Criminal Investigation Division of EPA executed a search warrant at Beta Chem on January 22, 2014, where agents discovered numerous containers containing hazardous wastes and contaminated with radiation. EPA’s Superfund program subsequently engaged in a removal action and disposed of the hazardous waste at a cost of over $760,000. In the process of assessing el-Sherif’s ability to pay for cleanup costs, EPA requested financial information. El-Sherif submitted three Beta Chem tax returns to EPA that he falsely claimed had been filed and that contained fictitious and misleading information.

An indictment is an allegation based upon a grand jury finding of probable cause. A defendant is presumed innocent unless and until convicted. If convicted of both charges, el-Sherif faces up to ten years in prison, and also could be fined.

Acting Assistant Attorney General Wood and U.S. Attorney Beall thanked the U.S. EPA for its work in this investigation. This case is being prosecuted by the Environmental Crimes Section of the Department of Justice and the U.S. Attorney’s Office. Senior Counsel Krishna S. Dighe with the Department of Justice’s Environmental Crimes Section in Washington, D.C., and Assistant U.S. Attorney Anthony Mattivi are in charge of the prosecution.