Eastern District of Kentucky
Press releases recorded for this federal judicial district.
Michigan and Ohio Residents Sentenced for Conspiracy to Distribute FentanylRead the Press Release
The prosecution involved more than 200 grams of the powerful and dangerous opioid
ASHLAND, Ky. – Demetre Brown-Lovelace, 27, of Belleville, Mich., and Noelle Tufts, 24, of Ironton, Ohio, were sentenced to federal prison today, by United States District Judge David L. Bunning, for a conspiracy to distribute fentanyl. Brown-Lovelace was sentenced to ten years and Tufts was sentenced to five years.
Brown-Lovelace and Tufts previously admitted that in April 2017, they conspired together and with others to distribute 209 grams of fentanyl. Brown-Lovelace had a prior conviction for trafficking in a controlled substance, heroin, from the Boyd Circuit Court, in April 2016. Brown-Lovelace and Tufts entered a plea to the conspiracy charge in May 2018.
Under federal law, Brown-Lovelace and Tufts must serve 85 percent of their prison sentence; and, upon their release, they will be under the supervision of the United States Probation Office for eight years and four years, respectively.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Robert Allan Jones, Special Agent in Charge, FBI, Pittsburgh Field Office; and Richard Sanders, Commissioner of the Kentucky State Police; jointly made the announcement.
The investigation was conducted by the FBI, Huntington, WV Resident Agency and the Kentucky State Police. The United States was represented by Assistant United States Attorney Cynthia T. Rieker.
Two Garrard County Men Indicted for $14.6 Million Tax Fraud SchemeRead the Press Release
LEXINGTON, Ky. – According to court records unsealed yesterday, two Garrard County, Ky. men have been charged with engaging in a massive tax fraud scheme, involving more than $14 million.
As alleged in the indictment, 47-year-old Clarence Michel Jr. and 49-year-old Warren Griffin II failed to pay $14,671,184 in payroll taxes, owed by various staffing companies that they operated between 2012 and 2016. Specifically, the indictment alleges Michel and Griffin withheld payroll taxes from their employees’ paychecks; but instead of paying that money over to the Internal Revenue Service, they instructed an employee to write checks to them. The indictment further alleges that, to hide this scheme, Michel and Griffin changed the names of their companies and started new companies under the names of various nominee owners. Similarly, the indictment charges Michel and Griffin with aiding and assisting in the preparation of false personal tax returns, for tax years 2012 through 2015.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky, and Christopher Altemus, Special Agent in Charge, Internal Revenue Service-Criminal Investigation, jointly announced the indictment.
The investigation preceding the indictment was conducted by the Internal Revenue Service-Criminal Investigation. The indictment was presented to the grand jury by Assistant U.S. Attorney Dmitriy Slavin.
Michel is scheduled to appear in court at 1:30PM, today. Griffin previously appeared in the Southern District of Illinois, where he was arrested. His appearance in Kentucky has not yet been set. For the conspiracy charge and the charges of failing to pay over payroll taxes, each defendant faces up to 5 years in prison and a fine of $250,000. For the false statements on their personal taxes, each faces 3 years in prison and a $250,000 fine. However, any sentence following a conviction would be imposed by the Court, after its consideration of the U.S. Sentencing Guidelines and the federal statutes.
Any indictment is an accusation only. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
Covington Man Sentenced to 360 Months for Production of Child PornographyRead the Press Release
COVINGTON, Ky., — Ryan J. Brock, 34, of Covington, was sentenced yesterday to 360 months in federal prison, by United States District Judge David L. Bunning, for production of child pornography. The sentence imposed was the maximum allowed by the statute.
Brock previously admitted to sexually abusing a minor relative and producing photographs and videos of the abuse using a tablet device. When a search warrant was executed at Brock’s residence in Covington, his device was not located, but an empty box for the device was found inside his vehicle. Agents also located a laptop that was forensically examined and found to contain images and videos depicting the sexual abuse perpetrated by Brock, as well as other child pornography. He pleaded guilty to the charge in December 2017.
Under federal law, Brock must serve 85 percent of his prison sentence, and, upon release, will be under the supervision of the United States Probation Office for 25 years.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; James M. Gibbons, Special Agent in Charge of Homeland Security Investigations (HSI) Chicago Field Office; and Chief Robert Nader, Covington Police Department, jointly announced the sentence.
The investigation was conducted by HSI and the Covington Police Department. The United States was represented by Assistant United States Attorney Elaine K. Leonhard.
Columbia Man Convicted of Conspiracy to Commit Mail FraudRead the Press Release
FRANKFORT, Ky. – A Federal jury sitting in Frankfort has convicted Ronnie C. Rodgers, 62, of Columbia, Ky., of conspiracy to commit mail fraud, wire fraud and securities fraud, arising from the sale of interests in oil and gas exploration ventures in South Central Kentucky, between 2007 and 2017. Rodgers, along with his brother, Ricky Rodgers, sold interests in oil and gas programs, in Adair, Clinton, Pulaski, and Warren Counties, and various sites in Tennessee, utilizing false and misleading representations about the chances of hitting productive oil wells, the length of time the wells would produce, and the amount of profit the investors could expect. The investments, totaling around $10 million, were sold under the names Rick-Rod Oil, Big South Resources, R&R Plus, and Hydro & Green Global Energy.
United States District Judge Gregory F. Van Tatenhove scheduled sentencing for December 5, 2018, in Frankfort. Rodgers faces a maximum sentence of five years in prison, on the single count of conspiracy.
The case was investigated by the United States Postal Inspection Service and the Kentucky Department of Financial Institutions, Division of Securities. The United States was represented by Assistant U.S. Attorneys Ken Taylor and Neeraj Gupta.
Lexington Man Pleads Guilty to Conspiracy to Distribute FentanylRead the Press Release
LEXINGTON, Ky. — Byron Lee White, 36, of Lexington, has pleaded guilty, to conspiracy to distribute 40 grams or more of fentanyl and heroin.
During his guilty plea, on August 2, 2018, White admitted that he conspired with others to distribute heroin and fentanyl. White admitted that he and others sold heroin, on November 16, 2017, and fentanyl and heroin on both December 5, 2017 and 22, 2017. White also admitted that he and others sold 55 grams of Fentanyl on January 17, 2018. White acknowledged that he had previously been convicted of the felony drug offense of Trafficking in Cocaine in Fayette Circuit Court in 2005. White was indicted by a grand jury in June of 2018.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Amy Hess, Special Agent in Charge, Federal Bureau of Investigation; and Richard Sanders, Commissioner, Kentucky State Police, jointly made the announcement.
Byron Lee White is currently scheduled to appear for sentencing before Chief United States District Judge Karen K. Caldwell, in Lexington, on November 8, 2018, at 4:00 p.m. He faces prison sentence of 10 years to Life imprisonment. However, any sentence following conviction will be imposed by the Court after consideration of the United States Sentencing Guidelines and the federal statute governing the imposition of sentences.
The investigation was conducted by F.B.I. and Kentucky State Police. The United States was represented in the case by Assistant United States Attorney Roger W. West.
Kenton County Man Sentenced to 52 Months for Illegally Possessing FirearmsRead the Press Release
COVINGTON, Ky. – Kevin Sellers, 26, of Covington, was sentenced today to 52 months in federal prison, by United States District Judge David L. Bunning, for unlawful possession of firearms.
Sellers previously pleaded guilty to possessing three firearms after having been convicted of a misdemeanor crime of domestic violence. According to the guilty plea agreement, the Covington Police Department stopped the vehicle Sellers was driving, on June 20, 2017, after receiving a complaint that he had threatened an individual with a gun. When officers stopped the vehicle, Sellers and three other individuals were present. In the car, officers discovered three semi-automatic pistols, including one that was capable of accepting a large capacity magazine and another that was later determined to have been stolen from a local police department.
Another Defendant, Jack Deakins, who was in the vehicle at the time, was convicted of the same offense and sentenced to 30 months in prison, on June 28, 2018.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Amy Hess, Special Agent in Charge, Federal Bureau of Investigations; and Robert Nader, Chief of the Covington Police Department, jointly made the announcement. The investigation was conducted by the FBI and the Covington Police Department. The United States was represented by Assistant United States Attorney Laura Voorhees.
Winchester man Sentenced to 110 Months for Possession of Stolen FirearmsRead the Press Release
LEXINGTON, Ky. — Brandon D. Martin, 29, of Winchester, has been sentenced to 110 months in federal prison, by Senior United States District Joseph M. Hood, for possessing stolen firearms.
Martin previously admitted that in June 2017, he had possessed five stolen firearms. Martin admitted that he knew the firearms had been stolen when he pawned them at several pawn shops in the Winchester area. Law enforcement agents in Clark and Woodford counties confirmed that these firearms had been stolen from burglaries of residences in Clark and Woodford Counties. Martin faces state charges in some of these counties for the burglaries. Martin has previously been convicted of three prior felony offenses.
Martin pleaded guilty to the federal charge in March 2018.
Under federal law, Martin must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for three years.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky;; Stuart Lowery, Special Agent in Charge, ATF; Burl Perdue, Jr., Clark County Sheriff, and James Fugate, Chief of the Versailles Police Department, jointly made the announcement.
The investigation was conducted by the ATF, Clark County Sheriff’s Office, and the Versailles Police Department. The United States was represented by Assistant United States Attorney Roger W. West.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
Breathitt County Ambulance Company, Its Owner and Managers Plead Guilty to Health Care FraudRead the Press Release
LEXINGTON, Ky. – Hershel Jay (“Jay”) Arrowood, Lesa Arrowood, Terry Herald, and Arrow-Med Ambulance, Inc. (“Arrow-Med”) have each pled guilty to health care fraud, in connection with fraudulent claims to Medicare and Medicaid for medically unnecessary ambulance transports.
Jay Arrowood has owned and operated Arrow-Med in Breathitt County, Ky. since September 2012. Arrow-Med provided certain patients with non-emergency ambulance transports, particularly to and from a dialysis clinic in Jackson, Ky. Jay Arrowood, Lesa Arrowood, Terry Herald, and Arrow-Med all admitted that they knew that Medicare would only pay for these non-emergency transports if other forms of transportation would endanger the patient’s health. Similarly, the defendants knew that Medicaid would only pay for non-emergency transports if the patient’s condition required a transport by stretcher.
Jay Arrowood, Terry Herald, and Arrow-Med all admitted that between September 2012 and August 2015, they worked together to submit false claims to Medicare and Medicaid seeking payment for non-emergency ambulance transports provided to certain patients. Lesa Arrowood, Jay Arrowood’s wife, admitted that she knowingly joined this scheme in December 2013. The defendants further admitted that they knew these patients did not qualify for Medicare or Medicaid coverage for the ambulance services, and Arrow-Med’s run sheets – medical records that documented the transports – were falsified to misrepresent the patients’ true medical condition. As a result of the defendants’ conduct, Medicare and Medicaid were defrauded of $249,539.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Derrick Jackson, Special Agent in Charge of the Atlanta Regional Office of the Department of Health and Human Services, Office of Inspector General (HHS-OIG) and the Kentucky Office of the Attorney General-Office of Medicaid Fraud and Abuse jointly announced the guilty pleas.
The investigation was conducted by HHS-OIG; the Kentucky Office of the Attorney General-Office of Medicaid Fraud and Abuse and the United States Attorney’s Office. The United States was represented by Assistant United States Attorneys Kate K. Smith and Paul C. McCaffrey.
The defendants are currently scheduled to appear for sentencing before Judge Joseph M. Hood on October 29, 2018. Their sentences will be imposed by the Court, after consideration of the United States Sentencing Guidelines and the federal statutes governing the imposition of sentences.
Three Men Sentenced for Trafficking Kilogram Quantities of FentanylRead the Press Release
LEXINGTON, Ky. – Three men have been sentenced, in the United States District Court in Lexington, for their roles in a conspiracy to distribute fentanyl, an extremely powerful, Schedule II controlled substance. The total amount of fentanyl seized during the investigation was in excess of three kilograms. On Friday, United States District Judge Danny C. Reeves sentenced Miguel Esparza, 30, of Lexington, to 157 months in prison. Judge Reeves previously sentenced co-Defendant Gadiel Ortiz-Flores, 39, of Lawrenceburg, to 136 months in prison and co-Defendant Brian Walker Hensley, 38, also of Lawrenceburg, was previously sentenced to 78 months in prison.
The joint investigation, by federal and state law enforcement, into the drug trafficking activities of the defendants culminated with the execution of search warrants on their residences and their arrests, on December 5, 2017. During the early stages of the investigation, agents purchased more than 300 grams of fentanyl from the defendants. During their arrests, Ortiz-Flores and Hensley were found in possession of one kilogram of fentanyl that was intended for distribution. At Esparza’s residence, in Fayette County, law enforcement officers seized nearly two kilograms of fentanyl that was intended for distribution. Fentanyl is extremely potent and can be lethal in the two-milligram range. Additional evidence found at the Esparza residence indicated that Esparza processed the drug in his residence, including dozens of latex gloves, masks, an air filtration system, and nearly one kilogram of non-controlled substances used to dilute the potent fentanyl.
“The defendants in this case were dealing in massive quantities of dangerous drugs,” said Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky. “The number of overdose deaths in our community continues to rise, and the quantities of illegal drugs involved in this criminal conspiracy were placing many lives in danger. Without the outstanding work of our law enforcements partners, this prosecution would not have been possible. Their efforts removed these drugs from our streets, made our community safer, and saved lives. Prosecuting those who deal in this scourge to our community will continue to be a core priority of our Office.”
United States Attorney Duncan; Darrell Christopher Evans, Special Agent in Charge, DEA Louisville; Stuart Lowrey, Special Agent in Charge ATF Louisville; Richard Sanders, Commissioner of the Kentucky State Police; Lawrence Weathers, Chief of Police, Lexington-Fayette County Division of Police; and Joe Milam, Sheriff, Anderson County Sheriff’s Office, jointly made the announcement.
The investigation was a cooperative effort led by investigators with the Drug Enforcement Administration; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Kentucky State Police; the Lexington Police Department and the Anderson County Sheriff’s Office.
Detroit Man Sentenced to 87 Months for Trafficking in Fentanyl, Heroin, and OxycodoneRead the Press Release
LEXINGTON, Ky. — Vincent S. Edge, 37, of Detroit, was sentenced to 87 months in federal prison, by United States District Judge Danny C. Reeves, for conspiring to distribute fentanyl, heroin, and oxycodone. Edge was also ordered to pay a $2,000 fine.
Edge previously admitted that, in early 2016, he came to the Richmond and Morehead, Kentucky areas to sell fentanyl, heroin, and oxycodone. Edge admitted that he supplied oxycodone to drug dealers in Morehead. Edge also leased an apartment in Richmond and sold fentanyl, heroin, and oxycodone from that location. Law enforcement agents purchased fentanyl, heroin, and oxycodone from Edge, in September of 2016. Edge also recruited other drug dealers from Detroit to live at his Richmond apartment and sell fentanyl, heroin, and oxycodone drugs in the areas. Edge supplied the drugs to local sellers and took the profits back to Detroit. On December 8, 2016, state and federal law enforcement agencies executed a search warrant at the apartment and recovered, drug proceeds, fentanyl, heroin, and oxycodone. Edge was ultimately arrested in Northern Ohio.
Edge pleaded guilty to the federal charge in April 2018.
“This is another example of drug traffickers from larger cities coming to Central Kentucky to profit from selling the illegal drugs that are devastating our community,” said Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky. “This prosecution should serve as warning to those who look to engage in similar conduct: if you are selling these dangerous drugs and profiting from the suffering and death they cause, no matter where you are from, we will look to prosecute you and place your freedom in jeopardy. We are committed to using all the tools we have to combat this continuing epidemic.”
“I want to commend the work of the DEA and our local law enforcement partners in this case,” said U.S. Attorney Duncan. “The partnerships between federal, state, and local law enforcement are critically important to reducing the presence of these drugs and the overdoses that are engulfing our community.”
Under federal law, Edge must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for three years.
United States Attorney Duncan; Darrell Christopher Evans, Special Agent in Charge, DEA; Richard Sanders, Commissioner of the Kentucky State Police; Matt Sparks, Rowan County Sheriff, and Mike Coyle, Madison County Sheriff, jointly made the announcement.
The investigation was conducted by the DEA, KSP, Rowan County Sheriff’s Office, and Madison County Sheriff’s Office, with the assistance of the Appalachian HIDTA. The United States was represented by Assistant United States Attorney Roger W. West.
Lexington Couple Sentenced for Drug Trafficking, Firearm OffensesRead the Press Release
LEXINGTON, Ky. — Brandi Stamper, 30, of Lexington, was sentenced yesterday to 15 years in federal prison, by Chief United States District Judge Karen K. Caldwell, for conspiring to distribute more than 40 grams of fentanyl, more than an ounce of crack cocaine, and more than half a kilo of cocaine. Stamper was also sentenced for being a felon in possession of firearms and for possessing a firearm in furtherance of her drug trafficking crime.
On Monday, Stamper’s co-defendant, Michael D. Jackson, 37, was sentenced to 25 years in federal prison after he pleaded guilty to the charges. Jackson’s convictions, combined with his criminal record, qualified him as both an Armed Career Criminal and Career Offender.
Jackson and Stamper previously admitted that, in early 2017, members of the Lexington Police Department (LPD), Narcotics Unit began an investigation into the residence they shared. The residence was located on Norway Street, near Lafayette High School. During the investigation, LPD stopped and searched Jackson’s vehicle, discovering a 9 mm firearm and large quantities of drugs. LPD detectives also executed a search on their residence where Stamper was located. LPD located quantities of a fentanyl mixture and cocaine, more than $80,000 in cash, a loaded Taurus handgun, a loaded Glock semi-automatic pistol, a loaded Cobra semi-automatic pistol, which was determined to have been stolen, and a vehicle that had been purchased with proceeds from Jackson and Stamper ’s drug trafficking.
Jackson admitted that he had prior drug trafficking convictions in Fayette Circuit Court. Stamper also admitted that she had prior felony convictions for Trafficking in Cocaine and Possession of Cocaine in Fayette Circuit Court. Jackson and Stamper pleaded guilty to these federal charges in April 2018.
“The Defendants’ drug trafficking activities, possession of firearms, and past criminal histories have led to this result,” stated Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky. “The sentences imposed should serve as warning to those who engage in similar criminal activities. If you illegally possess firearms, particularly if you are engaged in drug trafficking, you are putting yourself at risk for a substantial stay in federal prison.”
“I want to commend the work of the ATF and the Lexington Police Department on this investigation and prosecution,” said U.S. Attorney Duncan. “The partnership between federal, state, and local law enforcement is vitally important in preventing violent crime and reducing the danger caused by drug trafficking activities.”
Under federal law, Jackson and Stamper must serve 85 percent of their respective prison sentences. Upon release, Jackson and Stamper will both be under the supervision of the United States Probation Office for eight years.
United States Attorney Duncan; Stuart Lowery, Special Agent in Charge, ATF; and Chief Lawrence Weathers of the Lexington Police Department, jointly made the announcement.
The investigation was conducted by the ATF and the Lexington Police Department. The United States was represented by Assistant United States Attorney Roger W. West.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
Junction City Man Sentenced to 292 Months for Receiving Child PornographyRead the Press Release
LEXINGTON, Ky. – A Junction City man, Gene Paul Pendygraft, 46, has been sentenced to 292 months in federal prison, to be followed by a life term of supervised release, for knowingly receiving child pornography.
On Friday, United States District Judge Danny C. Reeves formally sentenced Pendygraft, who must serve 85 percent of his federal prison sentence.
Pendygraft previously admitted that, in November of 2016, he knowingly received images of child pornography on his laptop computer. A forensic examination of Pendygraft’s device revealed seven videos of child pornography, including some that depicted children under the age of 12 and some that depicted sadistic or masochistic conduct.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Steve Igyarto, Special Agent in Charge, Department of Homeland Security- Homeland Security Investigations (DHS-HSI), and Rick Sanders, Commissioner, Kentucky State Police (KSP), jointly announced the sentence.
The investigation was conducted by HSI and the KSP. The United States was represented by Assistant United States Attorney David Marye.
Five Flordia Residents Sentenced for Committing Credit Card Fraud in Northern KentuckyRead the Press Release
Three men and two women pleaded guilty to Conspiracy to Possess Counterfeit and Unauthorized Access Devices in March 2018
COVINGTON, Ky. – Jose Valdes, Jairo Castro, Yanetsi Sanchez, Arnado Salazar and Dianey Quintero, all residents of Tampa, Fla., were sentenced yesterday, to a range of 37 months to 46 months in federal prison, by United States District Judge David L. Bunning, for committing credit card fraud.
According to their guilty pleas, the Defendants were responsible for mailing a package containing 227 blank credit cards from Tampa, to a Florence, Ky. motel, using a local shipping company. Due to suspicious markings on the package, law enforcement began an investigation that ultimately led to a search of the package. Law enforcement tracked the package to the motel, and found the Defendants waiting, in three vehicles located nearby. A search of those vehicles resulted in the discovery of laptops and a thumb drive containing approximately 2,000 stolen account numbers. Also located were skimmer devices (used at gas stations to record account numbers from unsuspecting customers using the pumps), equipment designed to download the stolen account numbers onto blank cards, and seven money orders that had been purchased with stolen account numbers. The Defendants were arrested before they could unlawfully use the credit cards in the package.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky, and Yvonne Dicristoforo, Special Agent in Charge, United States Secret Service, jointly made the announcement. The investigation was conducted by the Cincinnati/Northern Kentucky International Airport Police and the United States Secret Service. The United States was represented by Assistant United States Attorney Laura Voorhees.
Grant County Doctor Sentenced to 151 Months for Drug TraffickingRead the Press Release
Federal jury found physician guilty of 173 drug trafficking offenses
COVINGTON, Ky. – Dr. Sundiata El-Amin, 69, of Ft. Wayne, Indiana, was sentenced today to 151 months in federal prison, by United States District Judge David L. Bunning, for 173 drug trafficking offenses. Dr. El-Amin was also ordered to pay a special assessment of $17,300.
Dr. El-Amin was previously convicted by a federal jury of conspiracy to distribute controlled substances, maintaining a premises for the distribution of controlled substances, and 171 individual counts of distributing controlled substances, in March 2018. According to the evidence presented, Dr. El-Amin conspired with his office manager to unlawfully dispense more than 300,000 oxycodone tablets, outside the scope of professional practice and without a legitimate medical purpose, over a period of approximately one year. The evidence further established that he repeatedly issued improper prescriptions for high doses of oxycodone and regularly issued the prescriptions without examining patients.
Dr. El-Amin was indicted in December of 2015. His office manager, Wendy Price, entered a guilty plea in February 2018 to charges of conspiring with Dr. El-Amin to commit the offenses. Under federal law, Dr. El-Amin must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for 3 years.
“The sentence imposed reflects the seriousness of the offense,” stated Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky. “The Defendant’s unnecessary prescribing of oxycodone damaged our communities and helped fuel the opioid epidemic. Our Office will continue to prioritize prosecuting these important cases.”
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky, and Timothy J. Plancon, Special Agent in Charge, Drug Enforcement Administration, jointly made the announcement. The investigation was conducted by the Drug Enforcement Administration. The United States was represented by Assistant United States Attorneys Tony Bracke and Laura Voorhees.
Lexington Man Sentenced to 25 Years for Drug Trafficking, Firearm Offenses and Being an Armed Career Criminal and Career OffenderRead the Press Release
LEXINGTON, Ky. — Michael D. Jackson, 37, of Lexington, was sentenced yesterday to 25 years in federal prison, by Chief United States District Judge Karen K. Caldwell, for conspiring to distribute more than 40 grams of fentanyl, more than an ounce of crack cocaine, and more than half a kilo of cocaine. Jackson was also sentenced for being a felon in possession of firearms and for possessing a firearm in furtherance of his drug trafficking crime. Jackson’s convictions, combined with his prior criminal record, qualified Jackson as both an Armed Career Criminal and Career Offender.
Jackson previously admitted that, in early 2017, members of the Lexington Police Department (LPD), Narcotics Unit began an investigation into his residence, which was located on Norway Street, near Lafayette High School. During the investigation, LPD stopped and searched Jackson’s vehicle, discovering a 9 mm firearm and large quantities of drugs. LPD detectives also executed a search on his residence, where they located quantities of a fentanyl mixture and cocaine, more than $80,000 in cash, a loaded Taurus handgun, a loaded Glock semi-automatic pistol, a loaded Cobra semi-automatic pistol, which was determined to have been stolen, and a vehicle that had been purchased with proceeds from Jackson’s drug trafficking.
Jackson also admitted that he had prior drug trafficking convictions in Fayette Circuit Court. Jackson pleaded guilty to the charges in April 2018.
“The Defendant’s drug trafficking activities, possession of firearms, and past criminal history have led to this result,” stated Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky. “The sentence imposed should serve as warning to those who engage in similar criminal activities. If you illegally possess firearms, particularly if you are engaged in drug trafficking, you are putting yourself at risk for a substantial stay in federal prison.”
“I want to commend the work of the ATF and the Lexington Police Department on this investigation and prosecution,” said U.S. Attorney Duncan. “The partnership between federal, state, and local law enforcement is vitally important in preventing violent crime and reducing the danger caused by drug trafficking activities.”
Under federal law, Jackson must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for eight years.
United States Attorney Duncan; Stuart Lowery, Special Agent in Charge, ATF; and Chief Lawrence Weathers of the Lexington Police Department, jointly made the announcement.
The investigation was conducted by the ATF and the Lexington Police Department. The United States was represented by Assistant United States Attorney Roger W. West.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
Nicholasville Man Sentenced to 30 Years for Inducing Minors to Produce Child PornographyRead the Press Release
LEXINGTON, Ky. – A Nicholasville man, Jordan Combs, 29, has been sentenced to 30 years in federal prison, to be followed by a life term of supervised release, for inducing minors to produce sexually explicit images.
On Monday, Chief United States District Judge Karen K. Caldwell formally sentenced Combs, who was convicted by a jury, on March 8, 2018, of 10 counts of receipt of sexually explicit images in interstate commerce, four counts of producing such images, five counts of distributing such images, and one count of possession of such images. Combs must serve 85 percent of his prison sentence.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Steven Igyarto, Special Agent in Charge, Department of Homeland Security – Homeland Security Investigations (DHS-HSI); and Richard Sanders, Commissioner of the Kentucky State Police; jointly announced the sentence.
The investigation was conducted by the Electronic Crimes Branch of the Kentucky State Police and DHS-HSI. The United States was represented by Assistant United States Attorney David Marye.
Lexington Man Sentenced to 50 Years for Using Two Minors to Produce Child PornographyRead the Press Release
LEXINGTON, Ky. – A Lexington man, Saul Aguilar -Andres, 20, has been sentenced to 50 years in federal prison, to be followed by a life term of supervised release, for using two minors to produce sexually explicit images and transporting those images, by posting them on Drop Box.
On Monday, Senior United States District Judge Joseph M. Hood formally sentenced Aguilar-Andres. Aguilar-Andres must serve 85 percent of his federal prison sentence.
Aguilar-Andres previously admitted that, in September and October of 2016, he used two minor victims to produce the sexually explicit images, and that in January of 2017, he transported those sexually explicit images by posting them to his Drop Box account.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Amy Hess, Special Agent in Charge, Louisville FBI; and Chief Lawrence Weathers, of the Lexington Police Department, jointly announced the sentence.
The investigation was conducted by the FBI, in Lexington and Chicago, and the Lexington Police Department. The United States was represented by Assistant United States Attorney David Marye.
Federal Medical Center Inmate Sentenced to 115 Months for AssaultRead the Press Release
LEXINGTON, Ky. – On Friday, Kevin Labracio Frazier was sentenced to 115 months in federal prison, by United States District Judge Danny C. Reeves, for an assault resulting in serious bodily injury.
According to testimony at trial, Frazier, an inmate at the Federal Medical Center in Lexington, assaulted another inmate that resulted in the victim suffering facial fractures and a deep laceration under his eye. Evidence further revealed that Frazier repeatedly punched the victim in the head and face outside of the housing unit, that the victim briefly lost consciousness, and the victim was transported to the University of Kentucky for medical treatment. Frazier was convicted at trial, in April of 2018.
Under federal law, Frazier must serve 85 percent of his prison sentence and will be under the supervision of the U.S. Probation Office for 3 years.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky, and Amy Hess, Special Agent in Charge of the Federal Bureau of Investigation’s Louisville Field Office, jointly made the announcement.
The investigation was conducted by Federal Bureau of Investigation and the Bureau of Prisons. The United States was represented by Assistant United States Attorney Ron L. Walker, Jr.
Dayton Ohio Man Sentenced to 4 Months for Making False Bomb ThreatRead the Press Release
FT. MITCHELL, Ky. – Dana Carter, 40, of Dayton, Ohio was sentenced today to 4 months in prison by United States District Judge David L. Bunning for making a false bomb threat.
Carter previously admitted that, on October 22, 2016, he made a series of phone calls to the Greater Cincinnati/Northern Kentucky International Airport to falsely report that there was a bomb on an outbound United Airlines flight to Dallas, Texas. The flight was cancelled and passengers were rebooked on other flights; no bomb was located. According to the Defendant, he was running late for the flight (on which he was a passenger) and made the false statements in attempt to delay it.
Under federal law, Carter must serve 85 percent of his prison sentence, and, upon release, will be under the supervision of the United States Probation Office for 3 years.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky, and Amy Hess, Special Agent in Charge of the Federal Bureau of Investigation’s Louisville Field Office, jointly made the announcement today after the sentencing.
The investigation was conducted by the FBI’s Northern Kentucky Joint Terrorism Task Force and the Cincinnati/Northern Kentucky International Airport Police Department. The United States was represented by Assistant United States Attorney Elaine K. Leonhard
Lexington Man Sentenced to 18 Months for Embezzlement from His EmployerRead the Press Release
LEXINGTON, Ky. – Thomas Scott Taylor, 38, of Lexington, Kentucky, was sentenced today to 18 months in prison by United States Senior District Court Judge Joseph M. Hood for exceeding authorized access of a protected computer, a felony under federal criminal statutes. Judge Hood also ordered Taylor to pay restitution in the amount of $492,689.59.
Taylor previously admitted to unlawfully abusing his authority to access certain protected databases of his employer, IntelliSurvey Inc., for personal gain. He further admitted that he knew that IntelliSurvey purchased and maintained a set of Amazon.com gift cards for use in rewarding IntelliSurvey’s survey participants and that some survey participants failed to redeem their Amazon.com gift cards. Taylor identified those unredeemed gift cards and used them to credit his personal Amazon account. In total, from December 16, 2011 until August 8, 2017, Taylor admitted he unlawfully stole $492,689.59 in Amazon.com gift cards from IntelliSurvey and used them to make 3,300 purchases at Amazon.com, ordering items that are easily resalable or for personal use.
Under federal law, Taylor must serve 85 percent of his prison sentence, and, upon release, will be under the supervision of the United States Probation Office for 3 years.
Robert M. Duncan, United States Attorney for the Eastern District of Kentucky, Jon Oldham, Resident Agent in Charge of the United States Secret Service, and Lawrence Weathers, Chief of Police for the Lexington Police Department, jointly made the announcement today after the sentencing.
The investigation was conducted by the United States Secret Service and the Lexington Police Department. The United States was represented by Assistant United States Attorney Kathryn Anderson.
Georgetown Man Sentenced to 190 Months for Receiving Child PornographyRead the Press Release
LEXINGTON, Ky. – A Georgetown man, Nicholas Aaron Willinger, 34, has been sentenced to 190 months in federal prison, to be followed by a life term of supervised release, for knowingly receiving child pornography.
On Monday, Senior United States District Judge Joseph M. Hood formally sentenced Willinger, who must serve 85 percent of his federal prison sentence.
Willinger previously admitted that, in November of 2013, he knowingly received images of child pornography on his laptop computer. A forensic examination of Willinger’s device revealed 56 videos of child pornography, including eleven videos depicting children under the age of six and four videos that depicted sadistic or masochistic conduct.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Amy S. Hess, Special Agent in Charge, Federal Bureau of Investigation, and Kentucky State Police Commissioner Rick Sanders jointly announced the sentence.
The investigation was conducted by the FBI and the KSP. The United States was represented by Assistant United States Attorney David Marye.
Mexican National Pleads Guilty to Distribution of Methamphetamine and an Immigration OffenseRead the Press Release
LEXINGTON, Ky. — Jose Jesus Navarro-Rios, a.k.a. “La Daga,” a Mexican National illegally residing in Lancaster, Ky., has pled guilty to three counts of distributing more than 500 grams of Methamphetamine and to unlawfully reentering the United States after previously being deported.
In his guilty plea, Navarro-Rios admitted that, on three occasions in the Spring of 2018, he sold methamphetamine in excess of 500 grams, to a cooperating witness for law enforcement. During the course of the joint federal and state investigation, law enforcement agents seized more than 12 pounds of methamphetamine, worth more than $125,000. Navarro-Rios admitted that he was unlawfully present in the United States, after being deported for a prior federal conviction for unlawfully reentering the United States, in 2013.
Robert M. Duncan Jr., United States Attorney for the Eastern District of Kentucky; Angela L. Byers, FBI Cincinnati; Amy Hess, FBI Louisville; Kristoffer Cortex, Acting Assistant Field Office Director, ICE; and Richard Sanders, Commissioner of the Kentucky State Police, jointly announced the guilty plea.
The investigation was conducted by FBI, KSP and ICE. The United States was represented in the case by Assistant United States Attorney Roger W. West.
Navarro-Rios is currently scheduled to appear for sentencing, in Lexington, on November 2, 2018, at 1:00 p.m. Navarro-Rios faces a prison sentence of not less than ten years nor more than Life imprisonment. However, any sentence will be imposed by the Court, after its consideration of the United States Sentencing Guidelines and the federal statute governing the imposition of sentences.
Former Powell County Detention Center Deputy Indicted for Conspiring with Inmates to Assault Victim and Lying to Federal InvestigatorsRead the Press Release
WASHINGTON – A federal grand jury in Lexington, Kentucky, today returned a four-count indictment charging Jamie Derickson, a former deputy of the Powell County Detention Center, with violating the civil rights of an arrestee by conspiring with inmates at the detention center to assault the arrestee in a jail cell. Derickson is also charged with lying to the FBI about the assault.
The indictment alleges that on Aug. 17, 2016, Derickson conspired with several inmates in the jail, agreeing that the inmates would assault the arrestee after Derickson placed him in the cell. When the arrestee entered the cell, the inmates assaulted the arrestee, causing bodily injury. The indictment also alleges that Derickson violated the arrestee’s constitutional rights by aiding and abetting the inmates’ assault of the arrestee, and by being deliberately indifferent to the known serious risk that the victim would be assaulted. Finally, the indictment alleges that Derickson later lied to special agents of the FBI when he claimed to them that, at the time he placed the arrestee in the cell, he did not know that the inmates were going to assault him.
If convicted, Derickson faces a maximum term of imprisonment of 10 years for each civil rights offense and five years for lying to investigators.
An indictment is merely an accusation, and the defendant is presumed innocent unless proven guilty.
The FBI conducted the investigation. Assistant United States Attorney Hydee Hawkins of the Eastern District of Kentucky and Trial Attorney Zachary Dembo of the Civil Rights Division are prosecuting the case.
Three Previously Deported Aliens Plead Guilty to Federal CrimesRead the Press Release
LEXINGTON, Ky. — Jose Alejandro Diaz -Tinoco, 35, Luis Eduardo Salto-Garcia 31, and Reynaldo Aviles- Hernandez 44, all Mexican Nationals, have each pled guilty to several federal crimes, including illegal re-entry to the United States after a previous deportation.
In the course of Diaz Tinoco’s his guilty plea, he admitted that he had previously been deported from the United States after being convicted of a felony drug trafficking offense in California. Tinoco admitted he unlawfully re-entered the United States prior to being arrested by the Kentucky State Police, on April 4, 2018, when he was in possession of $13,360 in cash. Immigration records show that Diaz-Tinoco has been deported from the United States on at least two prior occasions.
In the course of Luis Eduardo Salto-Garcia’s guilty plea, he admitted that he had previously been deported from the United States, and that he had unlawfully re-entered the United States prior to being arrested on March 1, 2018, by the Lexington Police, for unlawfully possessing a stolen firearm and a domestic violence offense. Immigration records show that Salto-Garcia has been deported from the United States on at least one prior occasion.
In the course of Reynaldo Aviles-Hernandez’s guilty plea, he admitted that he had previously been deported from the United States and had unlawfully re-entered the United States. He further admitted to using a fake United States social security card and other documents to obtain employment in Fayette County. Immigration records show that Aviles-Hernandez has been deported from the United States on at least three prior occasions.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Kristoffer Cortex, Acting Assistant Field Office Director, ICE; Chief Lawrence Weathers, Lexington Police Department; and Richard Sanders, Commissioner of the Kentucky State Police, jointly made the announced the guilty pleas.
The investigations were conducted by ICE, KSP, and the Lexington Police. The United States was represented in the cases by Assistant United States Attorney Roger W. West.
Diaz-Tinoco, Salto-Garcia, Aviles-Hernandez are currently scheduled to appear for sentencing, before Chief United States District Judge Karen K. Caldwell, on DATE. Their sentences will be imposed by the Court, after consideration of the United States Sentencing Guidelines and the federal statute governing the imposition of sentences.
Skilled Nursing Facility, Management Company, and Owner Agree to Pay $540,000 to Resolve Allegations of Providing Worthless Services and UpcodingRead the Press Release
LEXINGTON, Ky. – Preferred Care Inc. (Preferred Care); its Stanton, Kentucky skilled nursing facility, Stanton Nursing and Rehabilitation Center (Stanton Nursing); owner, Thomas D. Scott; Preferred Care Partners Management Group (PCPMG); and certain other affiliated entities have agreed to pay $540,000 to the United States and the Commonwealth of Kentucky, to resolve allegations that Stanton Nursing billed Medicare and the Kentucky Medicaid program for fraudulently inflated skilled nursing services and providing materially substandard care, in violation of the False Claims Act.
Preferred Care and its related entities own or operate approximately one-hundred skilled nursing facilities throughout the United States, including Stanton Nursing and twenty other facilities in Kentucky. Preferred Care’s facilities, including Stanton Nursing, are managed by PCPMG and related entities. Preferred Care, Stanton Nursing, and PCPMG, along with related entities in Kentucky and New Mexico, declared Chapter 11 bankruptcy, in November 2017, in the Bankruptcy Court for the Northern District of Texas. The respective bankruptcy courts approved the settlement on June 26, 2018.
The United States alleged that Preferred Care, PCPMG, Stanton Nursing, and certain related entities violated the False Claims Act by submitting, or causing the submission of, false claims to Medicare and Medicaid. Medicare reimburses skilled nursing facilities based on a patient’s resource utilization group, or RUG level, which is determined based on the anticipated amount of skilled therapy and skilled nursing services required by the patient. The United States alleged that, from July 1, 2012 through October 31, 2017, Preferred Care, PCPMG, and Stanton Nursing improperly coded patients for higher amounts of skilled nursing services than they needed or received, resulting in higher payments from Medicare.
The Settlement also resolves the government’s allegations that, from July 1, 2012 through April 30, 2015, certain patients at Stanton Nursing received materially substandard or worthless services.
“The United States is committed to protecting our senior community by ensuring that taxpayer dollars are not misspent and nursing facility residents are receiving appropriate, high quality care,” said Robert M. Duncan, Jr., U.S. Attorney for the Eastern District of Kentucky. “This settlement, reached in cooperation with our partners at the Kentucky Attorney General’s Office of Medicaid Fraud and Abuse, highlights our efforts to combat healthcare fraud, waste, and abuse, and hold accountable those who fraudulently deprive government health care programs of vital resources.”
“Protecting the health and safety of Medicare and Medicaid patients is our top priority,” said Derrick L. Jackson, the Special Agent in Charge at the U.S. Department of Health and Human Services, Office of Inspector General in Atlanta. “Settlements like this one hold skilled nursing facilities responsible for providing the best possible care to our beneficiaries.”
“My office works every day to protect Kentucky’s most vulnerable citizens and to seek justice for our seniors who have been physically abused,” Kentucky Attorney General Andy Beshear said. “Our work on this case is an example of our ongoing commitment and the commitment of our federal partners to stop those who harm our seniors by not giving them the very best care and service.”
The allegations were originally brought in lawsuits filed by defendants’ former employees Susan Helton and Joseph Donchatz, under the qui tam provisions of the False Claims Act. Under the Act, private parties may bring suit on behalf of the government and may receive a portion of any federal recovery.
The claims resolved by the settlement are allegations only and there has been no determination of liability.
This matter was handled as part of the Elder Justice Initiative of the Department of Justice (https://www.justice.gov/elderjustice/). In June 2016, the United States Attorney’s Offices for the Eastern District and Western District of Kentucky formed an Elder Justice Task Force (https://www.justice.gov/usao-edky/elder-justice-task-force). The Task Force was assembled to foster a collaborative working relationship among federal, state, and local agencies charged with protecting the elderly. The goals include ensuring the integrity of all government expenditures by eliminating fraud, waste, and abuse in health programs, and protecting some of the state’s most vulnerable citizens from harm, whether it occurs in nursing homes or other institutions, or involves financial fraud schemes. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services at 900-HHS-TIPS (800-447-8477).
This settlement is the result of an investigation by the U.S. Attorney’s Office for the Eastern District of Kentucky, U.S. Department of Justice Civil Division’s Commercial Litigation Branch, Office of Inspector General of the U.S. Department of Health and Human Services, and Kentucky Attorney General’s Office of Medicaid Fraud and Abuse. The cases are captioned U.S. ex rel. Doe v. Preferred Care Inc., et al. (E.D. Ky.) and U.S. ex rel. Donchatz v. Stanton Health Facilities, L.P., et al. (E.D. Ky.).
National Healthcare Fraud Takedown Results in Charges Against 601 Individuals Responsible for More Than $2 Billion in Fraud LossesRead the Press Release
Largest Health Care Fraud Enforcement Action in Department of Justice History Resulted in 76 Doctors Charged and 84 Opioid Cases Involving More Than 13 Million Illegal Dosages of Opioids
WASHINGTON - Attorney General Jeff Sessions and Department of Health and Human Services (HHS) Secretary Alex M. Azar III, announced yesterday the largest ever health care fraud enforcement action involving 601 charged defendants across 58 federal districts, including 165 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving more than $2 billion in false billings. Of those charged, 162 defendants, including 76 doctors, were charged for their roles in prescribing and distributing opioids and other dangerous narcotics. Thirty state Medicaid Fraud Control Units also participated in today’s arrests. In addition, HHS announced today that from July 2017 to the present, it has excluded 2,700 individuals from participation in Medicare, Medicaid, and all other Federal health care programs, which includes 587 providers excluded for conduct related to opioid diversion and abuse.
Attorney General Sessions and Secretary Azar were joined in the announcement by Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, Deputy Director David L. Bowdich of the FBI, Assistant Administrator John Martin of the Drug Enforcement Administration (DEA), Inspector General Daniel R. Levinson of the HHS Office of Inspector General (OIG), Deputy Chief Eric Hylton of IRS Criminal Investigation (CI), Director Alec Alexander of the Centers for Medicare and Medicaid Services (CMS) Center for Program Integrity and Director Dermot F. O’Reilly of the Defense Criminal Investigative Service (DCIS).
Yesterday’s enforcement actions were led and coordinated by the Criminal Division, Fraud Section’s Health Care Fraud Unit in conjunction with its Medicare Fraud Strike Force (MFSF) partners, a partnership between the Criminal Division, U.S. Attorney’s Offices, the FBI and HHS-OIG. In addition, the operation includes the participation of the DEA, DCIS, IRS-CI, Department of Labor, other various federal law enforcement agencies, and State Medicaid Fraud Control Units.
The charges announced yesterday aggressively target schemes billing Medicare, Medicaid, TRICARE (a health insurance program for members and veterans of the armed forces and their families), and private insurance companies for medically unnecessary prescription drugs and compounded medications that often were never even purchased and/or distributed to beneficiaries. The charges also involve individuals contributing to the opioid epidemic, with a particular focus on medical professionals involved in the unlawful distribution of opioids and other prescription narcotics, a particular focus for the Department. According to the CDC, approximately 115 Americans die every day of an opioid-related overdose.
“Health care fraud is a betrayal of vulnerable patients, and often it is theft from the taxpayer,” said Attorney General Sessions. “In many cases, doctors, nurses, and pharmacists take advantage of people suffering from drug addiction in order to line their pockets. These are despicable crimes. That’s why this Department of Justice has taken historic new steps to go after fraudsters, including hiring more prosecutors and leveraging the power of data analytics. Today the Department of Justice is announcing the largest health care fraud enforcement action in American history. This is the most fraud, the most defendants, and the most doctors ever charged in a single operation—and we have evidence that our ongoing work has stopped or prevented billions of dollars’ worth of fraud. I want to thank our fabulous partners with the FBI, DEA, our Health Care Fraud task forces, HHS, the Defense Criminal Investigative Service, IRS Criminal Investigation, Medicare, and especially the more than 1,000 federal, state, local, and tribal law enforcement officers from across America who made this possible. By every measure we are more effective at finding and prosecuting medical fraud than ever.”
“Every dollar recovered in this year’s operation represents not just a taxpayer’s hard-earned money—it’s a dollar that can go toward providing healthcare for Americans in need,” said HHS Secretary Azar. “This year’s Takedown Day is a significant accomplishment for the American people, and every public servant involved should be proud of their work.”
According to court documents, the defendants allegedly participated in schemes to submit claims to Medicare, Medicaid, TRICARE, and private insurance companies for treatments that were medically unnecessary and often never provided. In many cases, patient recruiters, beneficiaries and other co-conspirators were allegedly paid cash kickbacks in return for supplying beneficiary information to providers, so that the providers could then submit fraudulent bills to Medicare for services that were medically unnecessary or never performed. Collectively, the doctors, nurses, licensed medical professionals, health care company owners and others charged are accused of submitting a total of over $2 billion in fraudulent billings. The number of medical professionals charged is particularly significant, because virtually every health care fraud scheme requires a corrupt medical professional to be involved in order for Medicare or Medicaid to pay the fraudulent claims. Aggressively pursuing corrupt medical professionals not only has a deterrent effect on other medical professionals, but also ensures that their licenses can no longer be used to bilk the system.
Cases that have been indicted in the Eastern District of Kentucky are:
- United States v. Kimberly Jones (6:18-cr-00030 E.D. Ky.): Kimberly Jones, a licensed pharmacist in Williamsburg, Kentucky, is charged with 26 counts of distributing oxycodone or oxymorphone, one count of maintaining a drug involved premises, and one count of health care fraud. The Indictment alleges that Jones, the owner of Kim’s Hometown Pharmacy in Williamsburg, repeatedly filled prescriptions for oxycodone and oxymorphone outside the scope of professional practice, while also billing insurers for prescription drugs that were never dispensed to patients. The Indictment was unsealed following Jones’s arrest on June 26, 2018. The case is assigned to United States District Judge Gregory F. Van Tatenhove and is set for trial on August 21, 2018. Jones faces a maximum sentence of 20 years imprisonment if convicted on the controlled substance offenses and 10 years if convicted of health care fraud.
- United States v. Gary McPherson (6:18-cr-00031 E.D. Ky.): Gary McPherson, a licensed pharmacist, is charged with theft of pre-retail medical products in violation of 18 U.S.C. § 670. The charge stems from McPherson’s theft of pharmaceutical drugs from Kim’s Hometown Pharmacy in Williamsburg, Kentucky, in May 2018. The Indictment was unsealed on June 26, 2018, and McPherson will appear in court on July 11, 2018, for arraignment. The case is assigned to United States District Judge Gregory F. Van Tatenhove. McPherson faces a maximum sentence of five years imprisonment if convicted.
The Medicare Fraud Strike Force operations are part of a joint initiative between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations nationwide. Since its inception in March 2007, the Medicare Fraud Strike Force has charged over 3,700 defendants who collectively have falsely billed the Medicare program for over $14 billion.
A complaint, information, or indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
- United States v. Kimberly Jones (6:18-cr-00030 E.D. Ky.): Kimberly Jones, a licensed pharmacist in Williamsburg, Kentucky, is charged with 26 counts of distributing oxycodone or oxymorphone, one count of maintaining a drug involved premises, and one count of health care fraud. The Indictment alleges that Jones, the owner of Kim’s Hometown Pharmacy in Williamsburg, repeatedly filled prescriptions for oxycodone and oxymorphone outside the scope of professional practice, while also billing insurers for prescription drugs that were never dispensed to patients. The Indictment was unsealed following Jones’s arrest on June 26, 2018. The case is assigned to United States District Judge Gregory F. Van Tatenhove and is set for trial on August 21, 2018. Jones faces a maximum sentence of 20 years imprisonment if convicted on the controlled substance offenses and 10 years if convicted of health care fraud.
Man Illegally Residing in Lexington Sentenced to Nearly 30 Years for Drug Trafficking, Firearms, and Immigration OffensesRead the Press Release
LEXINGTON, Ky. – Fernando Rafael Lara Salas, age 40, who had previously used the aliases of Jesus Ruiz Vega, Francisco Garcia and Cristobal Palacios Garcia, was sentenced today, to 353 months in prison, by U.S. District Judge Danny C. Reeves. In January, Lara Salas was tried and convicted of multiple offenses, including drug trafficking, firearms and immigration offenses. His drug trafficking convictions included conspiracy to distribute more than five kilograms of cocaine, possession with intent to distribute more than five kilograms of cocaine, and possession with intent to distribute fentanyl, methamphetamine, and tramadol. Lara Salas’ firearms convictions included possession of a firearm in furtherance of a drug-trafficking crime, possession of a firearm as a convicted felon, and possession of a firearm by an alien. Lara Salas was also convicted of unlawfully re-entering the United States after previously being deported for a felony drug offense.
Two co-defendants in the case, Jorge De Jesus Macias Pedroza and Nestor Barron, were also convicted and previously sentenced by Judge Reeves, to terms respective terms of imprisonment of 188 and 120 months. All three men will be required to serve 85% of their sentences.
The joint investigation by federal and state law enforcement into the drug trafficking activities of Lara Salas began in August 2016 and culminated with the execution of search warrants at Lara Salas’ residence in Lexington and a cargo trailer located in a remote location in Franklin County. The search of Lara Salas’ home resulted in the seizure of 6 kilograms of cocaine, more than 50 grams of methamphetamine, a 9 mm firearm and $110,000 in U.S. currency. Evidence found in the cargo trailer revealed that Lara Salas and others utilized the trailer for the preparation of fentanyl for distribution. Agents located packaging material consistent with a kilogram quantity of a controlled substance. The packaging contained a residual amount of fentanyl, an extremely potent opioid. Also located in the trailer were five kilograms of tramadol, a Schedule IV controlled substance that is commonly used by drug traffickers as a cutting agent for fentanyl and heroin, and boxes of latex gloves. The investigation was a cooperative effort led by investigators with the Drug Enforcement Administration (DEA); the Department of Homeland Security, Immigration and Customs Enforcement (ICE); and the Lexington Police Department.
“Without the outstanding work of our law enforcements partners, this prosecution would not have been possible. Their efforts removed dangerous drugs from our streets, made our community safer, and saved lives. Prosecuting those who sell drugs in our community will continue to be a core priority of our Office,” said Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky.
United States Attorney Duncan; Darrell Christopher Evans, Special Agent in Charge, DEA Louisville; Kristoffer Cortex, Acting Assistant Field Office Director, ICE; and Lawrence Weathers, Chief of Police, Lexington-Fayette County Division of Police, jointly announced the sentence.
Lexington Man Sentenced to 15 Years for Trafficking in Fentanyl and Possession of a Firearm in Furtherance of Drug TraffickingRead the Press Release
LEXINGTON, Ky.— Melvin Tremayne Mahone, 31, of Lexington, was sentenced to 15 years in federal prison by Chief United States District Judge Karen Caldwell for Trafficking in more than 40 grams of Fentanyl and Possession of Firearms in Furtherance of Drug Trafficking.
On October 20, 2016, a search warrant was executed at Mahone’s residence, on American Avenue in Lexington. During the arrest and search of Mahone, officers located approximately 60 grams of fentanyl concealed in his underwear. Fentanyl can be lethal in the 2 milligram range. In close proximity to Mahone were two loaded firearms. Mahone has a prior federal felony conviction for drug trafficking. Mahone pleaded guilty to the charges in March.
Under federal law, Mahone must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for 8 years.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Stuart Lowery, Special Agent in Charge, ATF; and Lawrence Weathers, Chief of the Lexington Police Department, jointly announced the sentence.
The investigation was conducted by the Lexington Police Department and the ATF. The United States was represented by Assistant United States Attorney Roger W. West.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Sessions reinvigorated PSN in 2017, as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, local strategies to reduce violent crime.
Bell County Man Indicted for Child PornographyRead the Press Release
LONDON, Ky. – A Middlesboro, Ky. resident was indicted yesterday on federal charges of attempted production of child pornography and receiving, distributing, and possessing child pornography.
A federal grand jury in London returned the four-count indictment against 30-year-old Jordan Ryan Turner, a teacher and assistant basketball coach at Bell County High School. Turner was originally arrested on a state charge of using electronic means to induce a minor to engage in sexual activities. A federal criminal complaint was filed against Turner and those charges were presented to the grand jury, which returned the indictment.
Robert M. Duncan, Jr., U.S. Attorney for the Eastern District of Kentucky; Amy Hess, Special Agent in Charge, Federal Bureau of Investigation; and Richard Sanders, Commissioner of Kentucky State Police, jointly announced the charges.
The KSP and FBI have jointly conducted the investigation. Assistant U.S. Attorney Greg Rosenberg represents the United States in the case.
Trial is currently scheduled for September 4, 2018. If convicted on all counts, Turner faces a mandatory minimum of 15 years and maximum of 90 years in prison. However, any sentence following a conviction would come after the Court considers the U.S. Sentencing Guidelines and relevant federal statutes.
Any indictment is an accusation only. A defendant is presumed innocent and is entitled to a fair trial at which government must prove guilt beyond a reasonable doubt.
Ashland Physician and her Substance Abuse Treatment Center Sued for Healthcare Fraud and Controlled Substances Act ViolationsRead the Press Release
ASHLAND, Ky. – The U.S. Attorney’s Office has filed a civil lawsuit against an Ashland addiction treatment specialist, Dr. Rose O. Uradu, and her substance abuse treatment center, Ultimate Care Medical Services, LLC d/b/a Ultimate Treatment Center, alleging that they defrauded the both Medicare and Medicaid programs, and that they violated the Controlled Substances Act.
The lawsuit alleges that the defendants sought and received payments from Medicare and Medicaid for services that were not actually provided to patients. According to the complaint, between January 2013 and September 2014, defendants billed these government programs for “evaluation and management” services purportedly provided to patients who visited the clinic to receive daily methadone doses for their substance abuse treatment. Evaluation and management services typically include performance of an examination of the patient, a patient history, and medical decision-making. The complaint alleges that Ultimate Treatment Center did not perform these services when patients received their methadone doses, but billed Medicare and Medicaid for the services anyway. According to the complaint, defendants falsely documented the performance of evaluation and management services in the patients’ medical records, including by electronically copying notes from one visit to the next – for days, weeks, and even months.
The complaint further alleges that during the period July 2013 to December 2014, defendants billed Medicare and Medicaid for complex urine drug testing that was not actually performed.
The lawsuit contends that billing for services not provided violates the False Claims Act. If found liable, the defendants will have to repay Medicare and Medicaid three times the amount of the Government’s loss for the fraud, in addition to financial penalties of $5,500 to $11,000 per false claim. According to the complaint, the Government’s loss exceeds $1 million.
The lawsuit also alleges that, for a three-month period in 2014, Dr. Uradu issued buprenorphine prescriptions to twice as many patients as is permitted by law. Buprenorphine is marketed under the brand names Suboxone and Subutex, and is used medically in the treatment of opioid addiction. Because buprenorphine has the potential for diversion and abuse by recreational users, it is a controlled substance regulated by law. According to the complaint, Dr. Uradu was only permitted to treat 100 patients with buprenorphine drug products, but repeatedly exceeded her patient limit. Specifically, the complaint alleges that three months in a row, she wrote prescriptions for buprenorphine for more than 200 unique patients – twice her limit. The complaint contends that Dr. Uradu violated the Controlled Substances Act each time she wrote a prescription over her limit. Under that law, if found liable, Dr. Uradu is subject to a financial penalty of up to $25,000 for each violation.
Finally, the complaint further alleges that during the period January 1, 2017 to April 28, 2017, Ultimate Treatment Center failed to maintain complete and accurate records of the clinic’s methadone and buprenorphine inventories, as is required by law. According to the complaint, Ultimate Treatment Center’s records did not account for the equivalent of 45 bottles of methadone oral solution, and 22 bottles of buprenorphine tablets. The complaint contends that Ultimate Treatment Center’s failure to keep accurate records violates the Controlled Substances Act. Under that law, Ultimate Treatment Center is subject to a financial penalty of up to $10,000 for each recordkeeping violation.
The lawsuit is captioned United States v. Rose O. Uradu, M.D., et al., Civ. No. 18-66. The investigation preceding the complaint was conducted by agents with the U.S. Drug Enforcement Administration, Federal Bureau of Investigation, and the Kentucky Attorney General’s Medicaid Fraud and Abuse Control Unit. Assistant U.S. Attorney Christine Corndorf will represent the United States in this case.
Maysville Man Sentenced to 360 Months for Conspiracy to Distribute Heroin and Fentanyl Causing DeathRead the Press Release
COVINGTON, Ky. – Joshua D. Jett, 34, formerly of Maysville, Kentucky, was sentenced today to 360 months in federal prison, by United States District Judge David L. Bunning, for conspiracy to distribute heroin and fentanyl causing death.
Jett pled guilty, in June 2017, and admitted that he conspired with Kristian Bellamy and others to distribute heroin and fentanyl during the summer of 2016, and that drugs they distributed through that conspiracy caused a death on August 1, 2016. Jett and Bellamy regularly purchased what they believed to be heroin from Cincinnati and transported it back to Maysville, for use and distribution. They sold the drugs to several users on August 1, 2016; one of them, Amanda Hill-Borgmann, overdosed – on what was determined to be heroin and fentanyl – and died.
Under federal law, Jett must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for 5 years.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky, and Timothy J. Plancon, Special Agent in Charge, Drug Enforcement Administration (DEA), jointly announced the sentence. The investigation was conducted by the DEA. The United States was represented by Assistant United States Attorney Tony Bracke.
Former Rockcastle County Deputy Sheriff Indicted for Using Excessive Force Against Arrestee and for Obstructing JusticeRead the Press Release
LONDON, Ky. – A federal grand jury in London, Kentucky, today returned a two-count indictment charging Brandon McIntosh, a former deputy of the Rockcastle County Sheriff’s Office, with violating the civil rights of an arrestee by using excessive force against him and then filing a false report to obstruct the investigation of that assault.
The indictment alleges that on Nov. 6, 2016, McIntosh assaulted P.D., an arrestee, using a dangerous weapon and resulting in bodily injury to P.D. The indictment further alleges that McIntosh filed a report falsely stating that, as McIntosh approached P.D., P.D. became very combative and that McIntosh used the least amount of force to get P.D. under control.
If convicted, McIntosh faces a maximum term of imprisonment of 10 years on the civil rights charge and twenty years on the obstruction charge.
An indictment is merely an accusation, and the defendant is presumed innocent unless proven guilty.
The Federal Bureau of Investigation conducted the investigation. Assistant United States Attorney Hydee Hawkins of the Eastern District of Kentucky and Trial Attorney Mary J. Hahn of the Civil Rights Division are prosecuting the case.
Lexington Man Sentenced to 120 Months for Illegal Possession of a FirearmRead the Press Release
LEXINGTON, Ky. – A Lexington man, who previously admitted to being a felon in possession of a firearm, was sentenced today to 120 months in prison. This term has also been ordered to run consecutively to pending state court sentences.
Chief U.S. District Judge Karen K. Caldwell sentenced Antoine Lamar Burns, 36 years old, for unlawful possession of a firearm by a person convicted of a felony.
Burns previously admitted that, beginning in June 2015 and continuing through October 2015, he possessed a Bersa .380 semiautomatic pistol, after having been convicted of a felony offense. According to the plea agreement, Burns fired several shots at someone he suspected was cooperating with law enforcement, threatened and pointed the firearm at a former girlfriend, attempted to have his girlfriend make a false statement about ownership of the firearm, and attempted to hide the firearm in his girlfriend’s vehicle. Burns pleaded guilty in February.
Under federal law, Burns must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the U.S. Probation Office for three years.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Stuart Lowrey, Special Agent in Charge, ATF; and Lawrence Weathers, Chief of the Lexington Division of Police, jointly announced the sentence.
The investigation was conducted by ATF and Lexington Police. The U.S. Attorney’s Office was represented by Assistant U.S. Attorney Ron L. Walker, Jr.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
Cincinnati Man Convicted of Conspiracy to Distribute Controlled Substances Resulting in DeathRead the Press Release
COVINGTON, Ky. – A Cincinnati man was convicted today by a federal jury in Covington for conspiring to distribute carfentanil in the Boone County Jail Work Camp resulting in death.
After slightly under three hours of deliberations following a five day trial, the jury convicted 41 year old Johnny L. Shelton of conspiracy to distribute carfentanil resulting in death.
According to testimony at trial, Shelton led a conspiracy to smuggle carfentanil, an extremely powerful opioid, into the Boone County Jail Work Camp on or about October 15, 2016. Evidence revealed that Timothy Marcum, a fellow inmate, consumed some of the carfentanil and died. Jailers found Marcum’s deceased body in the work camp during the early morning hours of October 16, 2016.
Shelton and others were indicted in March of 2017. Two other members of the conspiracy, Chad Prodoehl and Gordon Wanser have been convicted in connection with this conspiracy. Prodoehl was sentenced to 25 years in prison on May 29, 2018. Wanser is still awaiting sentencing.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky, and Timothy J. Plancon, Special Agent in Charge, Drug Enforcement Administration (DEA), jointly announced the conviction.
The investigation was conducted by the DEA and the Boone County Sheriff’s Department. The United States was represented by Assistant United States Attorneys Anthony Bracke and Wade Napier.
Shelton will appear for sentencing on October 18, 2018. He faces a term of life imprisonment due to prior felony drug trafficking convictions. However, the Court must consider the U.S. Sentencing Guidelines and the applicable federal statutes before imposing a sentence.
Area Law Enforcement Meeting Held in SomersetRead the Press Release
SOMERSET, KY. – Federal, state and local law enforcement officials met yesterday in Somerset, to discuss initiatives of the U.S. Attorney’s Office and the Department of Justice that are designed to combat drug trafficking and violent crime.
Approximately 40 officials, including local prosecutors, police chiefs and sheriffs, met at the Center for Rural Development, to discuss current trends in drug trafficking and violent crime affecting the south central region of Kentucky. Representatives from Appalachia High Intensity Drug Trafficking Area (AHIDTA) gave an intelligence briefing on the current trends.
U.S. Attorney Robert M. Duncan, Jr., his executive staff, and members of federal law enforcement agencies, have been traveling across the Eastern District of Kentucky and meeting with local law enforcement to provide information on two major initiatives: the Department’s Project Safe Neighborhoods Enforcement Initiative and the U.S. Attorney’s Opiate/Opioid Prosecution Initiative. Attendees were given an overview of each initiative and provided tools, both to help them combat these problems on a local level and to develop appropriate cases for the prosecution of individuals under federal law.
“Our goal is to establish and maintain partnerships with local and state law enforcement, in a joint effort to remove violent offenders from our communities,” said U.S. Attorney Robert M. Duncan, Jr. “We also want to do our part in fighting the opioid epidemic, by providing tools to our local partners to assist in fighting the drug scourge impacting our communities.”
This is the third such meeting conducted by U.S. Attorney Duncan and was hosted and organized by Chief William Hunt of the Somerset Police Department. U.S. Attorney Duncan previously met with law enforcement partners in Ashland and Pikeville.
Manchester Man Sentenced to 32 Years in Connection with Violent Carjacking SpreeRead the Press Release
LONDON, Ky., — Timothy Lawson, 31, of Manchester, Ky., was sentenced today, to 32 years in federal prison, by United States District Judge Claria Horn Boom, on counts of brandishing and discharging a firearm during a carjacking.
Lawson entered a guilty plea to the charges in November of last year. According to the plea agreement, on July 21, 2016, Lawson unlawfully entered the residence and waited on the homeowner to return. When the homeowner arrived, Lawson met her, brandished a stolen shotgun, and threatened to kill her if she did not give him the keys to her vehicle. The homeowner complied and Lawson drove off in her vehicle. A short time later, Lawson wrecked the stolen vehicle and a family who saw the wreck and stopped to render assistance. Lawson then approached their vehicle, and again brandished the shotgun. Lawson also discharged the shotgun, firing a shot over the top of the family’s vehicle. Lawson ordered the family out of the vehicle, which he then stole. Lawson subsequently fled from the police and was arrested several days later.
Under federal law, Lawson must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for three years.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Stuart Lowrey, Special Agent In-Charge of the ATF; Richard Sanders, Commissioner of the Kentucky States Police; Chris Fultz, Chief of the Manchester Police Department; Kelly Shouse, Owsley County Sheriff; and Kevin Johnson, Clay County Sheriff, jointly announced the sentence.
The investigation was conducted by the ATF, the Kentucky State Police, the Manchester Police Department, the Owsley County Sheriff’s Office, and the Clay County Sheriff’s Office. The government was represented by Assistant United States Attorney W. Samuel Dotson.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
Knox County Man Sentenced to 30 Years for Distribution of Methamphetamine and Firearm OffensesRead the Press Release
LONDON, Ky. — Donnie Garland, 52, of Corbin, Ky., was sentenced Tuesday to 30 years in federal prison, by United States District Court Judge Gregory F. Van Tatenhove, for distributing methamphetamine, possessing with intent to distribute 50 grams or more of a methamphetamine mixture, possessing a firearm in furtherance of his drug trafficking crimes, and possessing a firearm following a felony criminal conviction.
A federal jury convicted Garland of these charges, following a two-day trial, in August of 2017. During the trial, video evidence revealed that Garland sold methamphetamine, on five different occasions, and that he possessed firearms or had armed guards stationed outside of his location, during some of these sales. Evidence in the case also included a search of Garland’s residence, which uncovered more than 150 grams of methamphetamine, more than120 grams of marijuana, nearly 700 pills, and 11 firearms. This conviction represents the sixth time Garland has been convicted of a drug trafficking offense, which qualified him as an Armed Career Criminal under Federal law.
Garland must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for 8 years.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Amy Hess, Special Agent in Charge of the FBI Louisville Field Division; Richard Sanders, Kentucky State Police Commissioner; and Mike Smith, Knox County Sheriff, jointly made the announcement. The United States was represented by Assistant United States Attorney Andrew H. Trimble.
Clay County Man Found with More than 5 Pounds of Methamphetamine Sentenced to 16 YearsRead the Press Release
LONDON, Ky.— Richard Walker, 33, of Manchester, Ky., was sentenced Tuesday to 16 years in federal prison, by United States District Court Judge Gregory F. Van Tatenhove, for conspiracy to distribute 500 grams or more of a methamphetamine mixture.
Walker pleaded guilty to the charges in February of 2017. During his guilty plea, Walker admitted that he had regularly obtained kilogram quantities of methamphetamine and sold it in Laurel County and Clay County, Kentucky. These charges were related to the seizure of more than five pounds of methamphetamine from Walker, in May of 2016.
Under federal law, Walker must serve 85 percent of his prison sentence, and, upon release, will be under the supervision of the United States Probation Office for 10 years.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Stuart Lowrey, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms, and Explosives; and Chris Fultz, Manchester Police Chief, jointly made the announcement. The United States Marshals Service and the Kentucky State Police also assisted in the investigation. The United States was represented by Assistant United States Attorney Andrew H. Trimble.
Four Central Kentucky Men Indicted for Crop Insurance Fraud and Money LaunderingRead the Press Release
LEXINGTON, Ky. – According to court records unsealed today, four men from Carlisle, Kentucky were indicted on June 6, 2018, for engaging in crop insurance fraud and money laundering-related offenses.
A federal grand jury in Lexington returned a twenty-count indictment charging 34-year-old Bradley Price, 27-year-old Brandon Price, 57-year-old Jimmy Price, and 58-year-old Lonnie Brierly with multiple counts of making false statements to influence the Federal Crop Insurance Corporation (“FCIC”) and companies the FCIC reinsures; one count each of committing a conspiracy to commit an offense against the United States; and one count of conspiracy to commit money laundering.
The indictment alleges that as early as 2009, the Prices and Brierly, all agricultural producers in Bourbon and Nicholas Counties, falsely understated their tobacco production to insurance companies, in order to claim damage to their crop and receive insurance indemnity payments to which they were not entitled. These indemnity payments are funded by the federal government, through the FCIC. For this conduct each defendant is charged with multiple counts of making false statements to influence the FCIC. The indictment also charges each defendant with conspiracy to commit crop insurance fraud. According to the indictment, the Prices and Brierly sold the tobacco they falsely claimed not to have produced, and, working with others, “hid” this production by making it appear as if the tobacco they sold had been purchased from Clay’s Tobacco Warehouse instead of produced on their respective farms.
Finally, according to the Indictment, the Prices and Brierly conspired with each other and others to launder the proceeds of the sales of their hidden tobacco by funneling money through Farm Credit Mid-America, an agricultural lending cooperative, in violation of federal money laundering statutes.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Karen Citizen-Wilcox, Special Agent in Charge, United States Department of Agriculture Office of Inspector General; Amy Hess, Special Agent in Charge, Federal Bureau of Investigation; Christopher Altemus, Special Agent in Charge, Internal Revenue Service-Criminal Investigation; and Dwayne Depp, Director, Kentucky Department of Insurance Fraud Investigation Division, jointly announced the Indictment.
The investigation preceding the indictment was conducted by the United States Department of Agriculture Office of Inspector General, United States Department of Agriculture Risk Management Agency, Federal Bureau of Investigation, Internal Revenue Service-Criminal Investigation, and Kentucky Department of Insurance. The indictment was presented to the grand jury by Assistant U.S. Attorneys Kathryn M. Anderson and Erin M. Roth.
A date for the Prices and Brierly to appear in court has not yet been scheduled. For each charge of making false statements to the FCIC, the Prices and Brierly face up to 30 years in prison and a fine of $1,000,000. For the conspiracy to violate federal law charge, each faces up to 5 years in prison and a fine of $250,000. For the remaining money laundering charge, each faces 20 years’ imprisonment and a $1,000,000 fine. However, any sentence following a conviction would be imposed by the Court, after its consideration of the U.S. Sentencing Guidelines and the federal statutes.
Any indictment is an accusation only. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
Kenton County Man Sentenced to 30 Months in Prison for Embezzling Wife’s Employee Benefit PlanRead the Press Release
Covington, Ky. — Ronald Barnett Hill, 49, of Ft. Mitchell, Kentucky, was sentenced today to 30 months in federal prison by United States District Judge David Bunning for embezzling $248,000 from his wife’s employee benefit plan.
Hill previously admitted that, in January, July and November 2013 he withdrew a total of $248,000 from a 401(k) account belonging to his wife. The 401(k) account was part of a defined contribution pension plan subject to Title I of the Employee Retirement Income Security Act of 1974. Hill owned and operated TPS Solutions, a corporation located in Kenton County, and as such was a fiduciary of the 401(k) funds held in accounts of its employees, including his wife. Hill stole nearly all of the money in his wife’s account by fraudulently completing a hardship withdrawal form, forging his wife’s signature, and signing the form as the Trustee authorized to complete the withdrawal. Hill pleaded guilty to the charges in March 2018.
Under federal law, Hill must serve 85 percent of his prison sentence, and, upon release, will be under the supervision of the United States Probation Office.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky, made the announcement today after the sentencing.
The investigation was conducted by the Federal Bureau of Investigation and the United States Department of Labor, Employee Benefits Security Administration. The United States was represented by former Assistant United States Attorney Robert K. McBride and Assistant United States Attorney Wade T. Napier.
On 500th Day of Trump Administration, Attorney General Sessions Announces 311 New Assistant United States Attorney PositionsRead the Press Release
Largest Increase in AUSAs in Decades Allocates Two Prosecutors to the Eastern District of Kentucky to Focus on Violent Crime and Civil Enforcement
LEXINGTON, Ky. – On the 500th day of the Trump Administration, Attorney General Jeff Sessions and Robert M. Duncan, Jr., U.S. Attorney for the Eastern District of Kentucky, announced that the Department of Justice is taking a dramatic step to increase resources to combat violent crime, increase civil enforcement efforts, and help roll back the devastating opioid crisis.
In the largest increase in decades, the Department of Justice is allocating 311 new Assistant United States Attorneys to assist in priority areas. Those allocations are as follows: 190 violent crime prosecutors, 86 civil enforcement prosecutors, and 35 additional immigration prosecutors. Many of the civil enforcement AUSA’s will support the newly created Prescription Interdiction & Litigation Task Force which targets the opioid crisis at every level of the distribution system. The Eastern District of Kentucky will receive two of the positions.
“Under President Trump's strong leadership, the Department of Justice is going on offense against violent crime, illegal immigration, and the opioid crisis—and today we are sending in reinforcements,” said Attorney General Jeff Sessions. "We have a saying in my office that a new federal prosecutor is ‘the coin of the realm.’ When we can eliminate wasteful spending, one of my first questions to my staff is if we can deploy more prosecutors to where they are needed. I have personally worked to re-purpose existing funds to support this critical mission, and as a former federal prosecutor myself, my expectations could not be higher. These exceptional and talented prosecutors are key leaders in our crime fighting partnership. This addition of new Assistant U.S. Attorney positions represents the largest increase in decades."
In the Eastern District of Kentucky, one of these AUSAs will focus on prosecuting violent crime cases. “President Trump and Attorney General Sessions have prioritized reducing violent crime, through investigation and prosecution of the ‘worst of the worst’ offenders. With this new position, we intend to do just that,” stated U.S. Attorney Duncan. “The new violent crime AUSA will work with our federal, state, and local partners to help protect the public and keep our communities safe and will prosecute cases arising from the Project Safe Neighborhoods initiative, a multi-agency partnership aimed at reducing violent crime and gun violence.”
The other AUSA position will focus on conducting affirmative civil enforcement actions, including bringing actions against medical professionals for over prescribing opioids and submitting fraudulent claims for reimbursement to the federal government. “As directed by Attorney General Sessions, we will use every available tool, including through the use of civil enforcement measures, to stop the spread of the opioid epidemic,” stated U.S. Attorney Duncan. “This new civil enforcement AUSA position will add to an already productive affirmative civil enforcement practice.”
To see more information on the locations of the 311 Assistant United States Attorney positions click here.
Corbin Man Sentenced to 360 Months for Devising Murder-for-Hire SchemeRead the Press Release
LONDON, Ky. — William Timothy Sutton, 55, of Corbin, Ky., was sentenced today to 360 months in federal prison, by United States District Court Judge Gregory VanTatenhove, on four counts of interstate murder-for-hire and one count of possession of firearms by a convicted felon.
Sutton was found guilty by a federal jury in January of this year. The evidence at trial established that, in March of 2017, while incarcerated in the Whitley County Detention Center, Sutton offered to pay a fellow inmate to murder the Whitley County Attorney, the Whitley/McCreary County Commonwealth’s Attorney, and two ex-girlfriends. The evidence further established that Sutton mailed a letter to a relative from jail, asking the relative to provide the would-be hitman with one of Sutton’s own firearms to further the scheme. Law enforcement became aware of the plan, interceded, and ultimately arrested Sutton.
“The sentence imposed illustrates the seriousness of the offense,” said Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky. “Through his abhorrent actions, the defendant victimized four people and attempted to undermine the sanctity of the judicial process and the rule of law.” “Protecting the public from violence and ensuring the integrity of our system of justice are core principles of the Department of Justice and central priorities of our Office. In our efforts to make our community safer, we will continue to confront and prosecute criminal conduct that undermines these principles.”
“I want to commend the work of our valued law enforcement partners, whose efforts made this prosecution possible. Their work on this investigation thwarted a significant threat to the victims’ safety and to the integrity of our judicial system.”
“ATF is committed to working with our law enforcement partners to protect citizens from those who threaten public safety through violent criminal behavior,” stated Stuart L. Lowrey, Special Agent In-charge, ATF Louisville Division. Defendant Sutton is a convicted felon who illegally possessed a firearm and threatened the lives of public servants committed to keeping our communities safe. We support today’s lengthy sentence as a deterrent to this criminal behavior.”
Under federal law, Sutton must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for three years.
United States Attorney Duncan; Stuart L. Lowrey, Special Agent In-Charge, ATF; and Commissioner Rick Sanders of the Kentucky State Police, jointly announced the sentence.
The ATF, the Kentucky State Police, and the Whitley County Detention Center conducted the investigation. Assistant United States Attorney W. Samuel Dotson represented the United States.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Sessions reinvigorated PSN in 2017, as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, local strategies to reduce violent crime.
Offenders Sentenced for Drug Trafficking and Firearms Offenses in PikevilleRead the Press Release
PIKEVILLE, Ky. – Yesterday, in proceedings at the U.S. District Court in Pikeville, Chief Judge Karen K. Caldwell sentenced the following defendants for drug trafficking and firearms convictions, in three separate cases.
Jeffrey Isaac, 61, of Melvin, Ky., was sentenced to 12 years’ imprisonment, and 3 years of supervised release, after he was convicted by a jury of conspiring to distribute oxycodone pills and possessing a firearm in furtherance of a drug trafficking crime. The proof at trial established that Isaac was a leader of the drug trafficking conspiracy.
Leroy Little, 67, of Pike County, Ky., was sentenced to 10 years’ imprisonment, and 3 years of supervised release, after pleading guilty to conspiring to distribute 5 kilograms or more of cocaine.
Brandy Watts, 35, of Fisty, Ky., was sentenced to just over 3 years’ imprisonment, and 3 years of supervised release, after she pleaded guilty to being a felon in possession of a firearm. Watts and her boyfriend, Justin Slone, were found in possession of several schedule II controlled substances and multiple firearms. Slone was previously convicted and sentenced.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Darrell Christopher Evans, Special Agent in Charge, DEA Louisville; and Lawrence Weathers, Chief of Police, Lexington-Fayette County Division of Police, jointly announced the sentences.
The cases are part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, local strategies to reduce violent crime.
Inmate in Boone County Sentenced to 300 Months for Drug Trafficking that Resulted in Overdose DeathRead the Press Release
COVINGTON, Ky., — Chad H. Prodoehl, 35, of Independence, Ky., was sentenced today, to 300 months in federal prison, by United States District Judge David L. Bunning, for conspiracy to distribute carfentanil resulting in death.
Prodoehl was convicted in December 2017, following a three-day trial. The evidence at trial established that, while he was an inmate at the Boone County Jail work camp, in Burlington, Ky., Prodoehl conspired with others to smuggle drugs into the work camp. Prodoehl was permitted to leave the camp on work release; and on October 15, 2016, he brought drugs, including carfentanil, back to the camp and distributed them. Several inmates used the drugs and one inmate, Timothy Marcum, overdosed and died as a result.
Under federal law, Prodoehl must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for five years.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky, and Timothy J. Plancon, Special Agent in Charge, Drug Enforcement Administration (DEA), jointly made the announcement.
The investigation was conducted jointly by the DEA and Boone County Sheriff’s Department. The United States was represented by Assistant United States Attorneys Elaine K. Leonhard and Anthony J. Bracke.
Arkansas Man Sentenced to 27 Months for FraudRead the Press Release
LEXINGTON, Ky. – A Cabot, Arkansas man, who previously admitted paying hundreds of thousands of dollars in bribes to receive millions of dollars of construction work, was sentenced today to 27 months in prison.
U.S. District Court Judge Danny C. Reeves sentenced 50-year-old Rocky Williams for the crime of conspiracy to commit honest services fraud.
Williams previously admitted that he conspired with James Newton, an employee at Saint Joseph Hospital in Lexington, Kentucky, between 2009 and 2012. Williams admitted that he paid over $500,000 in bribes to Newton, concealing them as payments of credit card and fuel bills, vehicle and rent payments, and gifts such as a motorcycle, an all-terrain vehicle, vacations, golf club memberships, a pool table, furniture, and home furnishings. In exchange, Newton, the Executive Director of Facilities responsible for assigning Saint Joseph Hospital’s general contracting work, steered over $8,000,000 of construction jobs to Williams’s company, ZaneRock Construction.
Williams pleaded guilty to conspiracy to defraud Saint Joseph Hospital, on December 17, 2017. Newton, 52-years-old and most recently living in Pace, Florida, had previously pleaded guilty to the same charge, on September 15, 2017. Williams and Newton were both given sentences of 27 months in federal prison, and both will share responsibility for repaying $532,660 in restitution to Saint Joseph Hospital. Williams will report to prison on August 27, 2018. Newton began his prison sentence on March 12, 2018.
Under federal law, Williams and Newton must serve 85 percent of their prison sentences; and upon their release, they will both be under the supervision of the U.S. Probation Office for three additional years.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky, and Amy Hess, Special Agent in Charge, Federal Bureau Investigation, jointly announced the sentence. The investigation was conducted by the FBI. The U.S. Attorney’s Office was represented by Assistant U.S. Attorney Neeraj Gupta.
Walton Man Sentenced to 264 Months for Conspiracy to Distribute MethamphetamineRead the Press Release
COVINGTON, Ky. – Garret Gadd, 45, of Walton, Kentucky, was sentenced today to 264 months in federal prison, by United States District Judge David L. Bunning, for conspiracy to distribute methamphetamine.
Gadd pled guilty, in February 2018, and admitted that he conspired with others to distribute more than 150 grams of crystal methamphetamine. Gadd had multiple prior felony convictions relating to methamphetamine distribution. A codefendant, Regina Gripshover, was sentenced to 46 months, in March.
Under federal law, Gadd must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for ten years.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky, and Timothy J. Plancon, Special Agent in Charge, Drug Enforcement Administration, jointly made the announcement. The investigation was conducted by the Northern Kentucky Drug Strike Force and the Drug Enforcement Administration. The United States was represented by Assistant United States Attorney Tony Bracke.
Newport Man Sentenced to 150 Months for Conspiracy to Distribute Heroin and FentanylRead the Press Release
COVINGTON, Ky. – Frederick D. Lewis, 38, of Newport, Kentucky, was sentenced today to 150 months in federal prison, by United States District Judge David L. Bunning, for conspiracy to distribute heroin and fentanyl.
Lewis pled guilty, in February 2018, and admitted that he led a conspiracy of five or more people responsible for distributing more than 100 grams of heroin and more than 160 grams of fentanyl. Lewis was on federal supervised release, for a 2011 conviction for conspiracy to distribute crack cocaine, when he committed his new offense. The 150-month prison term includes a sentence of 30 months for violation of the terms of his supervised release.
Under federal law, Lewis must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for ten years.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Amy Hess, Special Agent in Charge, Federal Bureau of Investigation; and Robert Nader, Chief of the Covington Police Department, jointly made the announcement.
The investigation was conducted by the Covington Police Department and the Federal Bureau of Investigation’s Safe Streets Task Force. The United States was represented by Assistant United States Attorney Tony Bracke.
Former Kentucky State Representative Sentenced to 2 Years for Aggravated Identity Theft for Aggravated Identity TheftRead the Press Release
PIKEVILLE, Ky. – Former Kentucky State Representative Wendell Keith Hall, 58, of Pikeville, was sentenced today to two years in prison, by Chief United States District Judge Karen K. Caldwell, for Aggravated Identity Theft. Judge Caldwell ordered that the sentence run consecutively, as required by law, to the 84-month prison sentence Hall is already serving for his 2015 conviction on bribery-related charges. In the bribery case, Hall, who owned coal mines and various coal industry-related businesses, was convicted by a Federal jury of paying a state mine reclamation inspector for favorable inspections and other favors related to the inspector’s job.
In February of this year, pursuant to a plea agreement, Hall pleaded guilty to one count of another, six-count indictment. The Aggravated Identity Theft offense was committed while Hall was pending trial and sentencing in the earlier case. The charge arose from Hall’s submission of fake documents to certify to another company, with which he had business contracts, that he had the required worker’s compensation and liability insurance coverage. Hall admitted that he caused the fake documents to be created and that they bore the forged name of an insurance executive, which was the basis of the identity theft charge.
Under federal law, Hall must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for three years to run concurrently with his other supervised release.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky, and Amy Hess, Special Agent in Charge, Federal Bureau Investigation, jointly made the announcement.
The investigation was conducted by the FBI. The United States was represented by Assistant United States Attorneys Ken Taylor and Erin Roth.
Former Kentucky County Treasurer Indicted for Fraud and Identity TheftRead the Press Release
WASHINGTON – The former Treasurer of Jackson County, Kentucky was indicted today for stealing over $160,000 from the Jackson County government and misusing the identities of two other Jackson County employees to facilitate her thefts. Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, U.S. Attorney Robert M. Duncan Jr. for the Eastern District of Kentucky, Special Agent in Charge Amy Hess of the FBI’s Louisville, Kentucky Field Division and Richard Sanders, Commissioner of the Kentucky State Police, made the announcement.
Beth N. Sallee, 37, of McKee, Kentucky, was charged in a 10-count indictment with four counts of wire fraud, four counts of theft from a program receiving federal funds, and two counts of aggravated identity theft. A date for Sallee to appear in court has not yet been scheduled.
The indictment alleges that Sallee misused her position to write a number of checks payable to herself without the approval of the Jackson County Fiscal Court. Sallee allegedly deposited these checks into her own personal checking account or for cash. Over time, those unauthorized checks totaled approximately $161,808.23. To enable her scheme, Sallee allegedly forged the signatures of at least two other Jackson County employees on the checks, and later attempted to conceal her scheme by removing pages of Jackson County financial documents, obscuring page numbers with whiteout, and requesting the removal of check images from bank statements that were to be given to an auditor.
The investigation was conducted by the FBI and the Kentucky State Police. The case is being prosecuted by Trial Attorney Jessica C. Harvey of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Andrew T. Boone of the Eastern District of Kentucky.
Any indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Former Kentucky County Treasurer Indicted for Fraud and Identity TheftRead the Press Release
The former Treasurer of Jackson County, Kentucky was indicted today for stealing over $160,000 from the Jackson County government and misusing the identities of two other Jackson County employees to facilitate her thefts. Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, U.S. Attorney Robert M. Duncan Jr. for the Eastern District of Kentucky, Special Agent in Charge Amy Hess of the FBI’s Louisville, Kentucky Field Division and Richard Sanders, Commissioner of the Kentucky State Police, made the announcement.
Beth N. Sallee, 37, of McKee, Kentucky, was charged in a 10-count indictment with four counts of wire fraud, four counts of theft from a program receiving federal funds, and two counts of aggravated identity theft. A date for Sallee to appear in court has not yet been scheduled.
The indictment alleges that Sallee misused her position to write a number of checks payable to herself without the approval of the Jackson County Fiscal Court. Sallee allegedly deposited these checks into her own personal checking account or for cash. Over time, those unauthorized checks totaled approximately $161,808.23. To enable her scheme, Sallee allegedly forged the signatures of at least two other Jackson County employees on the checks, and later attempted to conceal her scheme by removing pages of Jackson County financial documents, obscuring page numbers with whiteout, and requesting the removal of check images from bank statements that were to be given to an auditor.
The investigation was conducted by the FBI and the Kentucky State Police. The case is being prosecuted by Trial Attorney Jessica C. Harvey of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Andrew T. Boone of the Eastern District of Kentucky.
Any indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.