Western District of Kentucky
Press releases recorded for this federal judicial district.
Former Owner of Mortgage Lending Company GuiltyRead the Press Release
Submitted fraudulent funding requests for nonexistent mortgage loans
LOUISVILLE, Ky. – The former owner of an Orange County, California mortgage lending company pleaded guilty to bank fraud today, in U.S. District Court, for devising a scheme to defraud National City Bank of $12,744,678 of money under its control, by submitting fraudulent funding requests for nonexistent mortgage loans announced United States Attorney John E. Kuhn, Jr.
In 2007 and 2008, Brady Bunte owned and operated Trust One Mortgage, a mortgage lender located in Orange County, California. Trust One Mortgage funded mortgages by maintaining a warehouse line of credit with various banks, including National City Bank. National City Bank was a federally insured financial institution. Its warehouse lending offices were located in Louisville, Kentucky. As a warehouse lender, National City Bank provided revolving, short-term loans, known as warehouse lines of credit, to mortgage lenders.
In 2007 and 2008, Trust One Mortgage maintained a revolving warehouse line of credit with National City Bank to fund mortgages. In order to obtain funding from National City Bank for a particular mortgage, Trust One Mortgage submitted a funding request to National City Bank’s warehouse lending offices in Louisville, Kentucky. Once National City Bank received the funding request via fax or electronic request, it transferred the funds to the account specified by Trust One Mortgage in the funding request. National City Bank required Trust One Mortgage to pay off each specific loan within a set number of days. As part of its business, Trust One Mortgage sold or attempted to sell the individual mortgages to third-party investors.
From March 2007 through November 2008, Bunte caused Trust One to submit fraudulent funding requests on its warehouse line of credit to National City Bank. The fraudulent funding request caused National City Bank to incur a loss of $12,744,678.16.
Bunte was charged in a sealed indictment on September 18, 2014 and arraigned on the charge on September 29, 2014, in U.S. District Court located in Santa Ana, California.
Bunte is scheduled for sentencing before Chief District Judge Joseph H. McKinley Jr. on November 2, 2015 at 11am in Louisville.
This case was prosecuted by Assistant United States Attorneys Bryan Calhoun and Amanda Gregory and was investigated by the Federal Bureau of Investigation (FBI).
FBI Louisville Seeks the Public’s Assistance in Identifying Public Corruption within the Commonwealth of KentuckyRead the Press Release
Special Agent in Charge Howard A. Marshall of the FBI’s Louisville Division joined by John E. Kuhn, Jr. United States Attorney for the Western District of Kentucky and Kerry B. Harvey, United States Attorney for the Eastern District of Kentucky announced today a new initiative designed to solicit the public’s help in identifying public corruption within our community. The initiative includes the launch of a new, toll-free tip line (844) KYNOPC1 (596-6721), a billboard campaign, and a dedicated email address [email protected].
Public corruption is the FBI’s top criminal priority because it undermines the public’s trust in our government. A 2014 study by Harvard University’s Center for Ethics identified Kentucky as one of the most corrupt states in the country. In fact, in Kentucky between 2003 – 2012, approximately 300 individuals were convicted of federal crimes related to public corruption. It is a violation of federal law for any federal, state, or local government official to receive anything of value in exchange for or because of an official act. While the vast majority of public officials in Kentucky are dedicated and honest, SAC Marshall stressed “there is simply no acceptable level of corruption.”
“Public Corruption victimizes everyone – taxpayers, voters, communities,” stated U.S. Attorney John Kuhn. “Public officials, whether elected or appointed, are more than mere employees. They are servants of the public interest, and we must insist on absolute honesty, integrity and trustworthiness from every one. The U.S. Attorney’s Office for the Western District of Kentucky will continue working with our law enforcement partners to ensure crimes involving public corruption are prosecuted to the fullest extent of the law.”
U.S. Attorney Kerry Harvey agreed stating, “Public corruption is a terribly destructive force throughout Kentucky and has been a particularly pernicious problem in certain areas of the Eastern District of Kentucky. While the overwhelming majority of public officials serve honorably, those who corrupt the operations of government rob their communities-their friends and neighbors-of the fundamental right to honest government. We are pleased to continue our longstanding partnership with the FBI as we work together to combat this statewide problem.”
In a few short months, Kentucky will go to the polls for significant state-wide elections with a national election looming in 2016. SAC Marshall noted, “There is simply no greater right than to elect our political leaders. Anyone attempting to corrupt this process will be investigated as a top priority for our office."
This year also presents a new opportunity for our state government to partner with the FBI to address a potential, long term problem. For the first time ever, audits for Special Purpose Government Entities will be due in September. The FBI will work with the Kentucky Auditor of Public Accounts to identify individuals who have violated the public’s trust and misused SPGE funds.
The FBI relies on our federal, state, and local partners to address corruption matters, but concerned citizens are our biggest asset when it comes to exposing officials who use their positions for personal gain. As a result, the Louisville Division has set up the following hotline and email address seeking the public’s assistance in combating public corruption:
Toll-free: (844) KYNOPC1 (596-6721) or email: [email protected]
You will see billboards state-wide bearing this number and email address. SAC Marshall noted, “The “End Corruption Now” campaign seeks to unite the Commonwealth in the fight against corruption at every level, from the proverbial dog catcher, to the police officer, to the highest state and federal officials in the Commonwealth.”
Internet Prescription Drug Company Guilty of Dispensing Medication Without PrescriptionsRead the Press Release
Agrees to forfeit $450,000 from illegal sale of prescription drugs
LOUISVILLE, Ky. – An internet prescription drug company has pleaded guilty in U.S. District Court this week to charges of dispensing prescription drugs without a valid prescription and has agreed to forfeit $450,000 from the illegal sale of the prescription drugs, announced United States Attorney John E. Kuhn, Jr.
According to the plea agreement, Aracoma Drug Company operated a traditional and internet pharmacy located in West Virginia, which provided customers in Kentucky and other states with prescription drugs.
During the period between June 2009, through April 2012, Aracoma electronically received invalid prescriptions from NationalRXRPartners for prescription drugs to be dispensed from prescriptions that were issued from questionnaires completed over the internet. These prescriptions were not issued following the examination of patients by a qualified medical provider, as defined in each respective state.
Aracoma accepted these invalid prescriptions, filled these prescriptions, and then dispensed and shipped these prescription drugs to customers in Kentucky and other states throughout the United States and received payment in return.
At the time, Aracoma was aware that a valid prescription was needed prior to dispensing “prescription only” drugs to customers in Kentucky, West Virginia, and other states.
According to the plea agreement, Aracoma has agreed to pay $100,000 on the date of sentencing, and thereafter, make five payments of $70,000, for the next five years.
This case is scheduled for sentencing before U.S. Magistrate Judge Dave Whalin on November 20, 2015, at 1:30pm in Louisville.
This case is being prosecuted by Assistant United States Attorney Lettricea Jefferson-Webb and is being investigated by the U.S. Food and Drug Administration, Office of Criminal Investigations; the Kentucky State Police; and the West Virginia State Police.
Louisville Man Sentenced to 24 Months in Prison for Defrauding Two Churches and Several BusinessesRead the Press Release
Ordered to pay $114,018 restitution to the victims
BOWLING GREEN, Ky. – A Louisville man who admitted to defrauding two churches and several businesses was sentenced Thursday, by U.S. District Judge Greg N. Stivers, to 24 months in prison and ordered to pay restitution to the victims in the amount of $114,018 announced United States Attorney John E. Kuhn, Jr.
Timothy Ray Hatler, 59, was charged in a federal indictment on April 16, 2014 with three counts of mail fraud and one count of wire fraud and pleaded guilty to the charges on November 14, 2014.
According to the plea agreement, between March 18, 2011 and September 17, 2013, Hatler falsely represented to the public, through websites and internet postings, that he manufactured and sold light-emitting diode (LED) signs.
Hatler designed a scheme by doing business under various names including SignTech Manufacturing, SkyTech Signs, and Digital View Marketing. Hatler would inform individuals interested in purchasing LED signs that if they provided him with payment by mail or wire, he would provide signs made to their specifications. Hatler opened two bank accounts for the scheme and used a mailbox drop service in Atlanta to forward mail to two Louisville addresses and an address in Scottsville, Kentucky.
On a few occasions, Hatler ordered LED signs from other companies such as Olive LED and Soulphase, shipped the products to his customers, then requested that those customers serve as references for potential future customers. Most customers did not receive the signs they ordered and Hatler admitted to using the money for his personal use and benefit.
This case was prosecuted by Assistant United States Attorney Amanda Gregory and was investigated by the U.S. Federal Bureau of Investigation (FBI).
Bowling Green, Armed Career Criminal Sentenced to 15 Years in Prison for Conspiracy to Possess and Distribute Marijuana and Cocaine and Possession of A Firearm by A Convicted FelonRead the Press Release
BOWLING GREEN, Ky. – A Bowling Green armed career criminal was sentenced to 15 years in prison followed by 5 years of Supervised Release by United States District Court Judge Greg N. Stivers, for conspiring to possess and distribute marijuana, cocaine and cocaine base, possession of a firearm by a convicted felon, distribution of cocaine base, and maintaining a residence for the purpose of distributing controlled substances, today announced United States Attorney John E. Kuhn, Jr.
Antwain Santez Sweatt, age 37, pled guilty to five charges in a Superseding Indictment on April 21, 2015. According to the Plea Agreement, between June and July 2014, in Warren County, Kentucky, Sweatt knowingly conspired with others to possess with intent to distribute and distribute marijuana, cocaine and cocaine base. He also admitted to distributing cocaine base, commonly referred to as “crack cocaine,” on July 3, 2014. Further, Sweatt admitted to renting a house located at 834 Victoria Street, in Bowling Green, for the purpose of distributing or using controlled substances. Finally, Sweatt admitted to knowingly possessing a Jiminez Arms, 9 millimeter pistol and ammunition, after having been convicted of a felony. In fact, Sweatt was a multi-convicted felon.
On March 10, 1997, Sweatt was sentenced to 7 years in prison for trafficking in a controlled substance and possession of a controlled substance. On February 3, 2003, Sweatt was sentenced to 10 years in prison for trafficking in a controlled substance and, in a separate case, 15 years in prison for disarming a police officer, second degree assault and resisting arrest.
Assistant United States Attorney Jo E. Lawless prosecuted the case. The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Bowling Green Police Department, and the Bowling Green/Warren County Drug Task Force conducted the investigation.
Two Louisville Felons Sentenced to Federal Prison for Their Roles in A String of Armed Robberies of Local BusinessesRead the Press Release
LOUISVILLE, Ky. – Two Louisville felons were sentenced today in U.S. District Court by Chief Judge Joseph H. McKinley, to serve prison terms for their roles in a string of armed robberies announced Acting United States Attorney John E. Kuhn, Jr. The federal charges stemmed from “Project Recoil,” the on-going partnership of multiple Jefferson County, Kentucky law enforcement agencies, developed by the U.S. Attorney’s Office for the Western District of Kentucky, to maximize penalties for the most violent offenders and to reduce violent crime in our community.
James Gore, Jr. was sentenced to serve 72 months in prison followed by a 3 year period of supervised release, and Tony Trumbo, Jr. was sentenced to 255 months in prison followed by a 3 year period of supervised release for their roles in the armed robberies of three businesses located in Jefferson County, Kentucky.
Gore was sentenced after pleading guilty to aiding and abetting the obstruction of interstate commerce through robbery of two businesses. Trumbo was sentenced after pleading guilty to aiding and abetting the obstruction of interstate commerce through robbery, attempted robbery of three businesses, and aiding and abetting the discharge of a firearm during a robbery.
According to the plea agreement, Gore admitted to aiding and abetting the robbery of a Thorntons located at 4516 Poplar Level Road, with several other people, on October 30, 2012, and to aiding and abetting the robbery of a Speedway, with several other individuals, located on 3030 Taylor Boulevard on October 31, 2012.
In a separate plea agreement, defendant Trumbo admitted to attempting to rob the Cricket Wireless store, located at 3125 W. Broadway, along with other individuals, on October 23, 2012. Surveillance video taken from the store shows Trumbo along with an accomplice who was brandishing a firearm, attempting to rob the store. Trumbo also admitted to being one of several people to rob the Thorntons located at 4516 Poplar Level Road, on October 30, 2012. Trumbo further admitted to being one of several people to rob the Speedway located at 3030 Taylor Boulevard on October 31, 2012. During the course of that robbery, one of Trumbo’s accomplices shot a Speedway customer in the back causing serious bodily injury.
Co-defendants Jescell Whittle and Dahntel Newsome face separate charges for their alleged roles in the armed robberies and attempted robbery of five Jefferson County businesses.
This case is being prosecuted by Assistant United States Attorney A. Spencer McKiness and is being investigated by the Louisville Metro Police Department.
Army Sergeant Pleads Guilty to Conspiracy in Afghanistan Bribery SchemeRead the Press Release
PADUCAH, KY – A Fort Campbell Army Sergeant pleaded guilty today to conspiracy to commit bribery in connection with contracting for supplies while serving in Afghanistan.
Acting U.S. Attorney John E. Kuhn Jr. of the Western District of Kentucky, Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Assistant Director in Charge Andrew G. McCabe of the FBI’s Washington Field Office, Special Inspector General for Afghanistan Reconstruction John F. Sopko, Director Frank Robey of the U.S. Army Criminal Investigation Command’s (CID) Major Procurement Fraud Unit, Acting Special Agent in Charge Paul Sternal of the Defense Criminal Investigative Service’s (DCIS) Mid-Atlantic Field Office and Brigadier General Keith M. Givens, Commander of the Air Force Office of Special Investigations (OSI) made the announcement.
Ramiro Pena Jr., 43, of Fort Campbell, Kentucky, pleaded guilty before U.S. District Judge Thomas B. Russell of the Western District of Kentucky to a one-count information charging him with conspiracy to commit bribery. Sentencing has been scheduled for October 15, 2015.
From January 2008 through September 2009, Pena worked as a U.S. Army Sergeant First Class at the Humanitarian Assistance (HA) Yard at Bagram Airfield in Afghanistan. Pena and his supervisor, Army Master Sergeant Jimmy W. Dennis, were responsible for contracting with local vendors to purchase supplies necessary to support humanitarian relief in Afghanistan. On behalf of the Army, between June 2008 and March 2009, Pena and Dennis entered into approximately 217 such contracts for approximately $30,760,255.
In connection with his guilty plea, Pena admitted that they received money and jewelry from the vendors in return for Pena and Dennis taking action favorable to the vendors in connection with the HA Yard contracts. Specifically, Pena admitted that he received from the vendors, through Dennis, a Rolex watch in addition to $100,000 in bribe payments.
Pena admitted that he sent some of the cash to his family in Kentucky, which he dispersed throughout numerous greeting cards to avoid drawing attention to the thickness of any particular envelope. Pena also used the bribe money to pay his family’s personal expenses both in Afghanistan and in the U.S., and to purchase a Harley Davidson motorcycle.
In May 2014, Dennis pleaded guilty in the Western District of Tennessee to conspiracy to launder bribe payments. In January 2015, Dennis was sentenced to serve 41 months in prison and was ordered to forfeit $115,000.
This case was investigated by the Special Inspector General for Afghanistan Reconstruction, the FBI, CID, DCIS and OSI. This case is being prosecuted by Assistant U.S. Attorney Nute A. Bonner of the Western District of Kentucky and Trial Attorney Daniel P. Butler of the Criminal Division’s Fraud Section.
Two Charged Plead Guilty to Bank RobberyRead the Press Release
LOUISVILLE, Ky. – Two defendants pleaded guilty on June 26, 2015, in U.S. District Court before Senior Judge Charles R. Simpson III, to a single charge of bank robbery by force or violence announced Acting United States Attorney John E. Kuhn, Jr.
Leonard Duane Sisk, age 54, of Cecilia, in Hardin County, Kentucky, and Justin Matthew Collinge, age 32, of Leitchfield, in Grayson County, Kentucky, pleaded guilty to the December 23, 2014 robbery of the Westport Bank in Glendale, Kentucky.
According to the plea agreements, on December 23, 2014, defendant Sisk, knowingly aided and abetted by defendant Collinge, who acted as the getaway driver, robbed the West Point Bank. Sisk admitted to wearing a disguise while inside the bank, to demanding money from the teller, and to pointing a toy pistol at the teller which was painted black. The teller handed Sisk $8,815.00. Collinge admitted to driving a vehicle provided by Sisk, to the bank and to waiting for the robbery to occur, before acting as the getaway driver subsequent to the robbery. Further, Sisk acknowledged his role in the robbery to detectives of the Kentucky State Police on January 5, 2015.
If convicted at trial, the defendants could have been sentenced to no more than 20 years in prison, followed by a three year period of supervised release and ordered to pay a $250,000 fine. Sentencing is scheduled before Senior Judge Simpson on September 11, 2015, in Louisville.
This case is being prosecuted by Assistant United States Attorney Randy Ream and is being investigated by the Federal Bureau of Investigation (FBI) with assistance from the Kentucky State Police.
Hopkins County Residents Arrested and Charged in A Conspiracy to Sell “Spice”Read the Press Release
BOWLING GREEN, Ky. – Acting United States Attorney John E. Kuhn, Jr. today announced the successful arrest of 13 Hopkins County, Kentucky residents charged with conspiring to distribute synthetic marijuana or “spice.”
Yesterday morning, agents with the Drug Enforcement Administration (DEA), Kentucky State Police (KSP) and Madisonville Police Department arrested the defendants who are all charged in a single count indictment that was unsealed in U.S. District Court in Bowling Green, Kentucky.
According to the indictment, between October 2013, and June 2015, defendants Christopher Ray Barnes, Jessica L. Barnes, Joshua Elias Betar, Jason Matthew Demoss, Kara Ann Green, Nicholas Andrew Hollenbach, Matthew Robert Nash, Jeremy Jay Oglesby, Paula D. Oglesby, Megan Marie Tyson, Uriah Simpson, Roger Dal Thomas, and Jackie Wayne Vincent, Jr., all from Madisonville and surrounding communities, conspired to knowingly and intentionally distribute 100 kilograms or more of synthetic marijuana or “spice,” intended for human consumption.
Further, during the manufacture of “spice,” plant material is sprayed with a chemical compound AB-PINACA, a controlled substance analogue of ADB-PINACA, a Schedule I controlled substance, not legally sold in the United States. The chemical compound is manufactured in China and sold through mail order.
The defendants made their initial appearance before Magistrate Judge H. Brent Brennenstuhl in Bowling Green, yesterday, and all but defendants Green, Tyson, Simpson and Jessica Barnes were ordered to remain in the custody of the U.S. Marshals service pending arraignments and detention hearings to held Monday, June 29, 2015 in Owensboro. Defendant Jason Demoss is in state custody.
If convicted at trial, the defendants could be sentenced to no less than 5 years and no more than 40 years in prison, fined $5,000,000 and serve a four year period of supervised release.
This case is being prosecuted by Assistant United States Attorney Larry Fentress and is being investigated by DEA, KSP and the Madisonville Police Department.
***
The indictment of a person by a Grand Jury is an accusation only and that person is presumed innocent until and unless proven guilty.
Twelve Charged in Western District of Kentucky as Part of Largest National Medicare Fraud Takedown in HistoryRead the Press Release
Six cases charged during three day sweep totaling approximately $7.8 million in false billings
LOUISVILLE, Ky. – Acting United States Attorney John E. Kuhn, Jr. today announced the results of a health care fraud sweep in the Western District of Kentucky as part of the largest national Medicare fraud takedown led by the Justice Department and Department of Health and Human Services (HHS) Medicare Fraud Strike Force. The three day sweep, in the Western District of Kentucky, resulted in charges against 12 individuals, including three medical physicians, for their alleged participation in health care fraud schemes, involving approximately $7.8 million in fraudulent billings.
“Losses caused by health care fraud are staggering, amounting to tens of billions of dollars every year,” said Acting U.S. Attorney John Kuhn. “Sadly, these fraud losses are passed along to the rest of us in the form of increased health care costs. For that reason, investigating and prosecuting health care fraud is one of the Department of Justice’s highest priorities. As these cases demonstrate, federal, state and local law enforcement agencies are working together to turn the tide by prosecuting more fraudsters and recovering more money. And our enforcement efforts make great financial sense, too: when we pursue fraud against federal health care programs, we know we recover almost eight dollars for every dollar we expend in investigative and prosecution costs.”
“The Healthcare industry is massive and as a result Health Care Fraud is big business for criminals,” stated FBI Special Agent in Charge Howard S. Marshall. “HCF is one of our top Complex Financial Crime priorities and we continue to dedicate significant investigative resources to address it. We work closely with our local, state and federal partners; I am proud of our investigators who work hard to hold these criminals accountable.”
“Kentucky is facing an epidemic of prescription drug abuse,” said Derrick L. Jackson, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General in Atlanta. “Physicians who overprescribe narcotics not only waste valuable taxpayer dollars and defraud Medicare and Medicaid, they also threaten the health and safety of their patients.”
In the Western District of Kentucky, three physicians were charged in separate cases. The charges included billing for services at a higher code than the service provided, prescribing pain medications that resulted in the deaths of patients, and billing for non FDA approved IUDs.
Further, in a separate scheme, five defendants were charged with operating chiropractic clinics that falsely billed health care benefit programs approximately $5 million for injections that patients never received. Another charged scheme involved the alleged staging of an auto accident for passenger participants to seek unnecessary pain management treatment. (Indictments and press releases are attached)
Nationally, the sweep resulted in charges against 243 individuals, including 46 doctors, nurses and other licensed medical professionals, for their alleged participation in Medicare fraud schemes involving approximately $712 million in false billings. In addition, the Centers for Medicare & Medicaid Services (CMS) also suspended a number of providers using its suspension authority as provided in the Affordable Care Act. The coordinated takedown is the largest in Strike Force history, both in terms of the number of defendants charged and loss amount.
U.S. Attorney Kuhn acknowledged and credited the law enforcement agencies investigating these cases: Federal Bureau of Investigation (FBI), the U.S. Department of Health and Human Services-Office of Inspector General (HHS-OIG), the U.S. Drug Enforcement Administration (DEA), the United States Postal Inspection Service, the Internal Revenue Service Criminal Investigation, the National Insurance Crime Bureau, FDA – Office of Criminal Investigations, Kentucky State Police (KSP), Indiana and Kentucky Medicaid Fraud Control Units, Warren County Drug Task Force and Louisville Metro Police Department.
Owners and Staff of Louisville Area Chiropractic Clinics Charged with Health Care Fraud and Identity TheftRead the Press Release
Fraudulently Billed Insurance Companies $5 million for Services Never Performed
LOUISVILLE, Ky. – Acting United States Attorney John E. Kuhn, Jr. today announced the indictment and arrests of owners and staff of Louisville area chiropractic clinics and a medical billing corporation on charges of health care fraud and identity theft. The scheme involved unsuspecting chiropractors, patients, insurance companies, and area employers – namely Jeffboat, LLC located in Jeffersonville, Indiana. Over an eight-month-long period, the defendants are accused of scheming to fraudulently bill insurance companies $5 million for services never performed that cost Jeffboat a loss of approximately $1.3 million.
According to the eight count indictment, beginning no later than November 25, 2013, and continuing through July 18, 2014, five named defendants recruited unsuspecting chiropractors to either open chiropractic clinics or to staff existing chiropractic clinics in the Louisville area. Their intent was to fraudulently bill insurance companies from the clinics.Each chiropractor provided his/her National Provider Identifier (NPI) number to defendants Claudia Lopez and Oskel Lezcano in order to credential the clinics with various insurance companies.Thereafter, the defendants recruited employees from Jeffboat and others to seek chiropractic services from the clinics.However, unbeknownst to the patients and the chiropractors, the clinics billed over $5,000,000 for methocarbamol injections (a muscle relaxant),using the patients’ names, dates of birth, insurance/policy numbers, addresses, and patient IDs/Social Security Numbers without the patients’ knowledge and for injections that were never provided.
The clinics used Lezcano’s billing companies, Gold Hands Medical Billing Corp and Gold Hands Medical Billing B, Inc., to process the fraudulent billings for payment through Jeffboat’s third-party administrator, United Health Care Services, Inc. In addition, multiple clinics billed for the fraudulent injections using the same patients’ names.
Claudia Lopez, Oskel Lezcano, Ariel Borrego-Hernandez, Sergio Betancourt, and Ledinson Chavez operated and controlled multiple chiropractic clinics in the Louisville area including: Xpress Diagnostics Center, Inc.; Prudential Chiropractic Medical Center, PLLC; Klondike Chiropractic Medical Center, LLC; Be Well Chiropractic Center, Corp.; Chiropractic and Medical Center, LLC, even though the clinics were placed in various chiropractors’ names.
All five defendants are charged with one count of health care fraud. Lopez and Lezcano are both charged with additional counts of aggravated identity theft. If convicted at trial, the defendants could be sentenced to no more than ten years in prison, a $250,000 fine and a three year period of supervised release. Defendant Lopez could be sentenced to an additional 4 years in prison and fined an additional $500,000 for a conviction on the identity theft charges.Defendant Lezcano could be sentenced to an additional 10 years in prison and fined an additional $500,000 for a conviction on the identity theft charges.
This case is being prosecuted by Assistant United States Attorneys Joseph Ansari and Lettricea Jefferson-Webb and is being investigated by the Federal Bureau of Investigation (FBI), the United States Postal Inspection Service, the Internal Revenue Service Criminal Investigation, the Louisville Metro Police Department and the National Insurance Crime Bureau.
***
The indictment of a person by a Grand Jury is an accusation only and that person is presumed innocent until and unless proven guilty.
Kentuckiana Physician Charged with Prescribing Pain Medications That Resulted in the Deaths of Five Patients Faces Additional Charges Including Conspiracy, Money Laundering and Health Care FraudRead the Press Release
LOUISVILLE, Ky. – A Kentuckiana physician charged with prescribing pain medications that resulted in the deaths of five patients, unlawful distribution or dispensing of controlled substances and health care fraud, has been charged with conspiracy, money laundering and an additional count of health care fraud announced Acting United States Attorney John E. Kuhn, Jr.
Jaime Guerrero, age 47, formerly a medical physician with offices in Louisville, Kentucky, and Jeffersonville, Indiana, was charged by superseding indictment on June 16, 2015.
According to the superseding indictment, beginning no later than November 1, 2009, and continuing through January 1, 2013, Guerrero conspired with others to knowingly and intentionally distribute and dispense, schedule II and III controlled substances to patients, without a legitimate medical purpose and beyond the bounds of professional medical practice.
Further, beginning in December, 2009, and continuing through May 2014, Guerrero allegedly unlawfully prescribed and dispensed schedule II and schedule III pain medications to 30 patients, without a legitimate medical purpose and beyond the bounds of professional medical practice.
Further, the superseding indictment charges Guerrero with dispensing Oxycodone, a schedule II controlled substance, to K.J., between June 6, 2011, through August 25, 2011, without a legitimate medical purpose and beyond the bounds of professional medical practice, which resulted in K.J.’s death on or about August 29, 2011. That Guerrero intentionally distributed and dispensed, Methadone, a schedule II controlled substance, to D.N., between December 15, 2009, through April 1, 2010, without a legitimate medical purpose and beyond the bounds of professional medical practice, which resulted in D.N.’s death on or about April 5, 2011. That Guerrero knowingly and intentionally distributed and dispensed, Oxycodone, to R.S., between December 10, 2009, through February 9, 2010, without a legitimate medical purpose and beyond the bounds of professional medical practice, which resulted in R.S.’s death on or about February 18, 2010. That Guerrero dispensed Oxycodone, to P.F. December 28, 2009, and continuing through February 20, 2012, without a legitimate medical purpose and beyond the bounds of professional medical practice, which resulted in P.F.’s death on or about March 3, 2012. That Guerrero knowingly and intentionally distributed and dispensed, Hydrocodone, a schedule III controlled substance, to S.O., between January 6, 2010, and continuing through September 16, 2011, without a legitimate medical purpose and beyond the bounds of professional medical practice, which resulted in S.O.’s death on or about September 24, 2011.
Guerrero is further charged with three counts of health care fraud for fraudulently billing various health care benefit programs and for submitting fraudulent claims for patient health care counseling. Specifically, on May 26, 2011, June 15, 2011, and June 22, 2011, Guerrero allegedly saw more than 100 patients on each of the dates, by himself, and spent approximately 3 minutes or less with each patient, and fraudulently billed various health care benefit programs, for office visits at a higher code than the service provided. And for directing a staff member, who was not a licensed counselor, to provide drug education classes to patients, and falsely and fraudulently, bill various health care benefit programs, by submitting claims for 15-30 minute counseling sessions while the defendant was out of the office. In addition, the superseding indictment charges Guerrero with falsely and fraudulently submitting over 100 claims to various health care benefit programs for office visits at a higher code than the service provided; for office visits that were not medically necessary or within the course of usual medical practice; submitting claims for services that were not sufficiently documented in the patient’s medical record; and making claims for office visits as though a physician saw the patient, when in fact, a nurse practitioner saw the patient.
The superseding indictment includes a money laundering charge. Guerrero is accused of redeeming (paying the taxes) a building located at 1201 West Wall Street in Jeffersonville, Indiana, with $89,556.25 in cash derived from unlawful activity - the unlawful dispensing and distribution of controlled substances and health care fraud.
If convicted at trial, Guerrero faces up to life in prison, a financial fine and a period of supervised release.
This case is being prosecuted by Assistant United States Attorneys Joseph Ansari and Lettricea Jefferson-Webb and is being investigated by the Federal Bureau of Investigation (FBI), the U.S. Department of Health and Human Services-Office of Inspector General (HHS-OIG), the U.S. Drug Enforcement Administration (DEA), Indiana and Kentucky Medicaid Fraud Control Units, and Louisville Metro Police Department (LMPD).
***
The indictment of a person by a Grand Jury is an accusation only and that person is presumed innocent until and unless proven guilty.
Former Manager of Louisville Medical Office Charged with Health Care Fraud and Identity TheftRead the Press Release
LOUISVILLE, Ky. – Acting U.S. Attorney John E. Kuhn, Jr. today announced the indictment of a former medical office manager on charges of health care fraud and aggravated identity theft.
Kelly Lenning, age 44, of Jefferson County, Kentucky, was charged on June 17, 2015, in a six count federal indictment with scheming to defraud a health care benefit program, in connection with the delivery of and payment for health care benefits, items, and services.
Specifically, while manager of Injury Rehab Specialists of Lou., PLLC a medical practice that treated motor-vehicle-accident patients, Lenning is accused of unlawfully using former employees’ (nurse practitioners) DEA numbers to order controlled substance prescriptions, namely Hydrocodone by directing two individuals to fill Hydrocodone prescriptions between May and August of 2013. The individuals allegedly provided the filled Hydrocodone prescriptions to Lenning, for her own personal use, while she knew the individuals used Humana insurance, to pay for the unlawful prescriptions.
Further, Lenning is charged with using the identification of another person without lawful authority. Lenning is charged with identity theft of two nurse practitioners in relation to the health care fraud.
If convicted at trial, Lenning could be sentenced to no more than 36 years in prison, fined $1.5 million and a serve a three year period of supervised release.
This case is being prosecuted by Assistant United States Attorneys Joseph Ansari and Lettricea Jefferson-Webb and is being investigated by the Federal Bureau of Investigation (FBI) and Louisville Metro Police Department.
***
The indictment of a person by a Grand Jury is an accusation only and that person is presumed innocent until and unless proven guilty.
Former Employee of Injury Rehab Specialist and Others Charged in A Conspiracy to Commit Health Care FraudRead the Press Release
Scheme included staging an accident to receive pain medications
LOUISVILLE, Ky. – Acting United States Attorney John E. Kuhn, Jr. today announced the indictment and arrest of three Louisville co-conspirators charged with a single count of health care fraud.
Cynthia Allen, age 27, Terry Cotton, age 36, and Terry Jenkins, age 36, are charged with conspiring with each other to recruit individuals to participate in a November 27, 2012, staged automobile accident, where one vehicle intentionally struck another vehicle. The object and purpose of the conspiracy was to obtain money and property under the custody and control of health care benefit programs, and to receive controlled substances.
In furtherance of the conspiracy, Allen directed staged, accident passenger participants to seek chiropractic treatment at the clinic at which she was employed. Allen and Cotton then directed passenger participants to seek pain management treatment, including receiving pain medication, at Injury Rehab Specialists of Lou., PLLC, where Allen subsequently became employed. As a result of these acts, among others, automobile insurance companies were billed for and paid for unnecessary treatment at the chiropractic clinic, Injury Rehab Specialists of Lou., PLLC, and other medical providers.
Further, Jenkins is charged with health care fraud for fraudulently submitting a settlement demand for $14,882.29 to Safe Auto Insurance Company for alleged injuries he sustained in a staged automobile accident, and receiving a settlement of $11,000.00.
Further, Terry Cotton is charged with unlawful distribution of a controlled substance. According to the indictment, between June 20, 2012, and continuing through January 17, 2014, Cotton and others, conspired with each other to knowingly and intentionally distribute and dispense, a mixture and substance containing a detectable amount of Hydrocodone, a schedule III controlled substance.
If convicted at trial, the defendants could be sentenced to no more than 20 years in prison, and 3 years of supervised release and fined $500,000.
This case is being prosecuted by Assistant United States Attorneys Joseph Ansari and Lettricea Jefferson-Webb and is being investigated by the Louisville Metro Police Department and the FBI.
***
The indictment of a person by a Grand Jury is an accusation only and that person is presumed innocent until and unless proven guilty.
Daviess County Medical Physician Charged with Importing and Billing Medicaid for Misbranded and Unapproved DrugsRead the Press Release
Allegedly Billed Medicaid $68,171.34 for IUD’s Not Approved For Use By The FDA
OWENSBORO, Ky. – Acting United States Attorney John E. Kuhn, Jr. today announced the single charge of misbranded and unapproved drugs, against a Daviess County, Kentucky medical physician.
Randall Edward King, MD, age 56, of Women’s Healthcare, located in Owensboro, Kentucky, was charged by an information in Owensboro, on June 17, 2015.
King is accused of importing intrauterine devices (IUDs) from the United Kingdom, which were designed for use in Turkey, and for billing Medicaid $68,171.34 for the IUDs which were not approved for use by the U.S. Food and Drug Administration (FDA). These IUDs are considered misbranded because their labeling was not in the English language, rendering those labels unlikely to be read and understood by the ordinary individual under customary conditions of purchase and use.
If convicted at trial, King could be sentenced to no more than one year in prison, ordered to pay a fine of $1,000 and to serve a one year period of supervised release.
This case is being prosecuted by Assistant United States Attorney David Weiser and is being investigate by the FDA – Office of Criminal Investigations.
***
The indictment of a person by a Grand Jury is an accusation only and that person is presumed innocent until and unless proven guilty.
Bullitt County, Kentucky, Man Pleads Guilty to Production of Child PornographyRead the Press Release
LOUISVILLE, Ky. – A Bullitt County, Kentucky, man pleaded guilty yesterday afternoon, before Senior United States District Judge Thomas B. Russell, to two charges of producing child pornography, announced Acting United States Attorney John E. Kuhn, Jr.
Michael Mudd, age 45, was arrested on August 25, 2014, on a criminal complaint. A federal grand jury indicted Mudd on September 18, 2014. Mudd pleaded guilty to two separate counts of producing child pornography. Additional charges for receiving child pornography remain pending.
According to the record of this case, and information disclosed during yesterday’s hearing, law enforcement officials executed a federal search warrant on Mudd’s residence on August 7, 2014. Mudd was at home during execution of the warrant. Law enforcement officials seized a number of items, including computers, cellular telephones and other digital devices. The items were submitted for forensic examination.
While law enforcement officials were on the scene of the search, neighbors approached and expressed concern about Mudd’s conduct with young boys in the neighborhood. Within 24 hours of executing the warrant, an adult female made contact with law enforcement. She reported that her 12-year-old son told her that Mudd had recorded her son engaged in sexually explicit conduct.
A staff member with Family and Children’s Place in Louisville, Kentucky, conducted a forensic interview with the boy. During the interview, the child described multiple occasions during which Mudd photographed and videoed the child engaging in sexually explicit conduct. According to the child, the recording/photographing took place on multiple occasions dating back to the fall of 2013 and continuing to May 2014. The computer forensic examination of the items seized from Mudd’s home revealed the existence of the videos / photographs described by the boy.
Mudd admitted, during the change of plea hearing, that he had photographed and videoed two different male children. He created the images inside his residence as well as outside at a small lake near the trailer park where he lived.
Mudd faces a statutorily mandated sentence of 15 years in prison and could be sentenced up to 60 years in prison. Further, Mudd faces at least 5 years and up to a life term of supervised release and a fine of $500,000.
Assistant United States Attorney Jo E. Lawless is prosecuting the case. The United States Postal Inspection Service, with assistance from the Bullitt County Sheriff’s Office, conducted the investigation.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Virginia Business Owner Charged with Wire Fraud for Stealing $809,205.43 from VictimsRead the Press Release
LOUISVILLE, Ky. – The owner of Patriot Computers, a Virginia corporation, was charged by grand jury indictment today with wire fraud for stealing $809,205.43 from multiple victims, announced Acting United States Attorney John E. Kuhn, Jr.
According to the four count indictment, from December 1, 2012, through April 14, 2014, Mark Allen Hartley, age 55, of Land O Lakes, Florida, devised a scheme to defraud First Citizens Bank of Hardin County, Kentucky, and its customers. At the time, Hartley operated a business called Spartan Group Inc., dba Patriot Computers. Patriot Computers sold computer equipment to its customers on installment sales contracts. Customers of Patriot Computers agreed to have specified amounts of money taken from their paychecks on a regular basis until their purchases were paid in full. These customers completed payment authorization forms for these payment arrangements, and then Patriot Computers submitted these forms to First Citizens Bank in Hardin County, Kentucky. First Citizens Bank, through its bill payment service, would then transfer the payments from each customer’s paycheck to Patriot Computers’ account at Wells Fargo Bank until the customer’s contract with Patriot Computers was paid in full.
As part of the scheme and artifice to defraud, Hartley created fraudulent payment authorization forms and transmitted those, by e-mail, to First Citizens Bank. This caused the bank to transfer unauthorized payments from victims’ paychecks to an account at Wells Fargo Bank, controlled by Hartley. These unauthorized payments totaled approximately $809,205.43.
If convicted at trial, Hartley could be sentenced to no more than 20 years in prison for each count, fined $250,000 for each count and sentenced to 3 years of supervised release.
This case is being prosecuted by Assistant United States Attorney Jason Snyder and is being investigated by the Federal Bureau of Investigation (FBI).
***
The indictment of a person by a Grand Jury is an accusation only and that person is presumed innocent until and unless proven guilty.
Jefferson County, Kentucky, Man Sentenced to 51 Months in Prison for Transporting Adult Females with the Intent That They Engage in ProstitutionRead the Press Release
Most were psychologically abused and physically assaulted
LOUISVILLE, Ky. - A Jefferson County, Kentucky, man was sentenced today in U.S. District Court by Senior Judge Thomas B. Russell to 51 months in prison for transporting adult females, with the intent that they engage in prostitution, announced Acting U.S. Attorney John E. Kuhn, Jr.
Dwayne Watkins, age 37, transported at least six females from Kentucky to other states to engage in prostitution between 2007 to August 2014. Five of the six females were often psychologically abused and physically assaulted as a means to coerce them. Watkins used various internet websites such Craigslist, Eros, and Backpage to advertise prostitutes working for his prostitution business and facilitate communication with potential clients.
Watkins transported the females, (at least one of the victims was homeless), from Kentucky to Indiana, North Carolina, Illinois, Georgia, Florida, Virginia and Ohio, to engage in prostitution.
Further, Watkins told one of the victims that he would be her modeling “Agent”. However, at the direction of Watkins, the female victim became a working prostitute and was forced to give Watkins every dollar made from prostitution.
This case was prosecuted by Assistant United States Attorney Joshua Judd and was investigated by the Federal Bureau of Investigation, Louisville Metro Police Department, and Jefferson County Sherriff’s Office.
Former Bowling Green Physician Charged with Conspiracy to Dispense Controlled Substances, Health Care Fraud and Money LaunderingRead the Press Release
BOWLING GREEN, Ky. – Acting U.S. Attorney John E. Kuhn, Jr. today announced the indictment of former Warren County, Kentucky, physician Charles Fred Gott on charges of conspiracy to distribute and dispense controlled substances during the course of his professional practice that were not for a legitimate medical purpose, health care fraud, and money laundering.
Gott, age 63, a formerly licensed physician in the Commonwealth of Kentucky, was indicted by grand jury in Bowling Green on June 10, 2015. The indictment was unsealed following his arrest this morning in Nashville, Tennessee, and initial appearance on the charges before Magistrate Judge H. Brent Brennenstuhl in Bowling Green.
According to the 14 count indictment, the alleged criminal activity occurred between 2006 and September 19, 2013, in Warren County, Kentucky.
Gott is charged with a single count of conspiring with others to knowingly and intentionally distribute and dispense, not for a legitimate medical purpose in the usual course of professional practice, Schedule II, Schedule III and Schedule IV controlled substances. Included are nine counts of unlawfully dispensing Methadone and Fentanyl – Schedule II controlled substances and one count of unlawfully dispensing Hydrocodone – a Schedule III controlled substance.
Further, during the same time period, Gott is charged with executing a scheme to falsely and fraudulently bill various health care benefit programs, including Medicare and Medicaid, by submitting claims for office visits at a higher code than the service actually provided to patients under his care. Also, Gott is charged with directing staff members to provide medically unnecessary spirometry tests to patients, and to falsely and fraudulently bill various health care benefit programs, including Medicare, Medicaid, and Anthem, among others, by submitting claims for medically unnecessary spirometry tests, for patients. A spirometry test assess lung function in the diagnosis of asthma, chronic obstructive pulmonary disease (COPD) and other conditions that affect breathing.
Gott also is charged with one count of money laundering for transferring $14,000 to a Merrill Lynch investment account, on March 22, 2012, which was allegedly derived from unlawful activity, that is the unlawful drug distribution and health care fraud alleged in Counts 1 and 13.
Gott is further subject to forfeiture to the United States government, any and all proceeds derived from unlawful activity as a result of the offenses alleged in the indictment and the forfeiture of Gott’s license to practice medicine.
If convicted at trial, Gott faces no more than 20 years in prison, per count, for counts 1-10, no more than 10 years in prison, per count, for counts 11-14, no less than 3 years of supervised release, and a $12,000,000 fine. Gott is scheduled for arraignment on June 24, 2015, at 10am in Bowling Green.
This case is being prosecuted by Assistant United States Attorneys Mac Shannon, Lettricea Jefferson-Webb and Joseph Ansari. This case is being investigated by the Drug Enforcement Administration (DEA) Drug Diversion Section, The U.S. Department of Health and Human Services-Office of Inspector General (HHS-OIG), Warren County Drug Task Force, Kentucky State Police, Office of the Attorney General, Medicaid Fraud and Abuse Division and Federal Bureau of Investigation (FBI).
Clinton County, Kentucky, Man Guilty of Filing False Tax ReturnsRead the Press Release
Failed to report earnings and pay income taxes on $386,183.67 during a six year period and overstated business expenses of $581,519.91
BOWLING GREEN, Ky. – A Clinton County, Kentucky, man pleaded guilty today in United States District Court to six counts of failing to report approximately $386,183.67 in income and royalty income during a six year period and for overstating business expenses of $581,519.91 announced Acting United States Attorney John E. Kuhn, Jr.
Steven L. Burchett, age 50, admitted in court, before U.S. District Judge Greg N. Stivers, to willfully making and subscribing U.S. Individual Tax Returns, for the calendar years 2006 through 2011,which were written under the penalty of perjury and filed with the Internal Revenue Service, (IRS) and included information he did not believe to be true and correct.
Specifically, on October 11, 2008, Burchett filed a U.S. Individual Tax Return for calendar year 2006, with the IRS, in which he failed to report approximately $224,735.76 of additional income on Form 1040 line 22.
On October 8, 2008, Burchett filed a U.S. Individual Tax Return, for the calendar year 2007, with the IRS, in which he failed to report approximately $27,003.91 of additional income on Form 1040, Line 22.
On October 15, 2009, defendant Burchett filed a U.S. Individual Tax Return, for the calendar year 2008, with the IRS, and included information he did not believe to be true and correct. Specifically, the return overstated approximately $41,394 in business expenses on Schedule C, Line 28, and failed to report royalty income of approximately $18,236 and understated approximately $56,895 in additional income on Form 1040, Line 22.
On April 15, 2010, defendant Burchett filed a joint U.S. Individual Tax Return, for the calendar year 2009, which was made under the penalty of perjury and was filed with the IRS, and included information he did not believe to be true and correct. Specifically, the return overstated approximately $90,650 in business expenses on Schedule C, Line 28, and failed to report approximately $38,323 in royalty income and understated approximately $123,225 in additional income on Form 1040, Line 22.
On April 15, 2011, defendant Burchett filed a joint U.S. Individual Tax Return, for the calendar year 2010, which was made under the penalty of perjury and was filed with the IRS, and included information he did not believe to be true and correct. Specifically, the return overstated approximately $305,564 in business expenses on Schedule C, Line 28, and failed to report approximately $64,490 in royalty income and understated approximately $360,380 in additional income on Form 1040, Line 22.
On April 15, 2012, defendant Burchett filed a joint U.S. Individual Tax Return, for the calendar year 2011, which was made under the penalty of perjury and was filed with the IRS, and included information he did not believe to be true and correct. Specifically, the return overstated approximately $72,050 in business expenses on Schedule C, Line 28, and failed to report approximately$74,778 in royalty income and understated approximately $135,611 in additional income on Form 1040, Line 22.
If convicted at trial, Burchett could have been sentenced to three years in prison on each of the six charges for a total of eighteen years, a total fine of $1,500,000., and a period of up to one year of supervised release. Sentencing is scheduled in Bowling Green on September 14, 2015 at 10 a.m.
This case is being prosecuted by Assistant United States Attorney Joshua Judd and is being investigated by the Criminal Investigation Division of the Internal Revenue Service.
Columbus Man Sentenced for Six Armed Robberies in Four StatesRead the Press Release
Southern District of Ohio press release:
COLUMBUS, Ohio – William J. McBride, Jr., 49, of Columbus, was sentenced in U.S. District Court to 216 months in prison for armed bank robberies in Ohio, West Virginia, Kentucky and Indiana.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Division, William J. Ihlenfeld, II, United States Attorney for the Northern District of West Virginia, John E. Kuhn, Jr., Acting United States Attorney for the Western District of Kentucky, Kerry B. Harvey, United States Attorney for the Eastern District of Kentucky, and Joshua Minkler, United States Attorney for the Southern District of Indiana, announced the sentence handed down today by Senior U.S. District Court Judge James L. Graham.
According to court documents, between June 21, 2014 and August 23, 2014, McBride robbed six different federally insured banks in five different federal jurisdictions while armed with a dangerous weapon.
McBride, at gunpoint, demanded and received more than $21,000 in cash total from the banks. The defendant did not wear any disguise during the robberies, and witnesses in each location described him similarly.
On August 23, 2014, a witness reported McBride’s license plate number upon seeing the defendant flee in his vehicle after robbing the Wesbanco Bank in St. Clairsville, Ohio. Law enforcement officials discovered the vehicle was registered to McBride and subsequently arrested him later the same day in a hotel in Columbus, Ohio.
McBride pleaded guilty to six counts of armed robbery on February 2, 2015. He was also sentenced to five years supervised release.
U.S. Attorney Stewart commended the cooperative investigation by the FBI and other law enforcement agencies in each jurisdiction, as well as Assistant United States Attorney Salvador A. Dominguez, who represented the United States in this case.
Former Officer of Nationwide Fence and Supply Co. Pays $358,707.06 to Settle Alleged False Claims Act Violations Involving Disadvantaged Business Enterprise Requirements in Federally Funded ProjectsRead the Press Release
Alleged Violations Involved Federally Funded Transportation Projects in Kentucky and Indiana
LOUISVILLE, Ky. – Micheal DeMil, a former officer of RMD Holdings, Ltd d/b/a Nationwide Fence and Supply Co. (Nationwide) today paid $358,707.06 to settle allegations that while a project manager, he violated the Disadvantaged Business Enterprise (DBE) requirements in certain federally funded construction projects, announced Acting U.S. Attorney John E. Kuhn, Jr. Today’s payment, in addition to a $1,750,000 payment by Nationwide in December of 2014, settles allegations that the company circumvented the DBE requirements in federally funded construction projects.
“The Disadvantaged Business Enterprise program was created to ensure a level playing field for small, minority-owned and women-owned companies in federally funded transportation projects,” stated Acting U.S. Attorney Kuhn. “By circumventing the law, Mr. DeMil undermined the goal of assisting disadvantaged companies in a market where the federal government invests many millions of dollars.”
The settlement agreement arises from Nationwide’s utilization of a DBE company as a pass through in order to meet the requirements specified in federally funded projects. In particular, the United States contends that during the period from January 6, 2008, through July 16, 2010, then officer and project manager Micheal Demil caused Nationwide to misrepresent how it utilized Sallie’s Wholesale Construction, Inc. This was in violation of federal regulations guiding participation of DBEs in federally funded Department of Transportation Financial Assistance Programs. The projects were in Indiana (where Nationwide installed security fencing at an airport) and in Kentucky (where Nationwide installed high tension cable barriers in Barren, Bullitt, Hart and Jefferson Counties in June of 2008). On both of these projects Michael DeMil acted as project manager.
An earlier settlement agreement with Nationwide covered conduct in 2008, when the Department of Transportation-Office of Inspector General began investigating Nationwide. The federally funded projects were performed between October 20, 2006, through July 16, 2010, in Kentucky, Indiana, Illinois, Georgia and New York and most involved the installation of guardrails, security fencing, and cable barriers along interstates.
At the time, Nationwide was co-owned by two brothers: Micheal DeMil and Robert DeMil. The company was a specialty construction group that conducted business in 33 states with its principal office located in Chesterfield Township, Michigan. Many of the transportation projects on which Nationwide worked were funded in whole or in part by the United States, and each project required a certain percentage of DBE participation. Nationwide was not a certified DBE.
The DBE program generally requires that recipients of federal highway funds establish a program to assist women owned or minority owned businesses to compete for work on federally funded construction projects. Recipients of these funds often accomplish this goal by requiring that each construction project include a certain percentage of participation by a DBE company. This percentage can be met by contractors utilizing DBE subcontractors to either perform work on the project or to supply materials.
Micheal DeMil and Fenton Construction and Excavating, Inc. (where Mr. DeMil is now the majority shareholder, co-director, and Vice President) also have agreed to enter into a three year administrative settlement and compliance agreement with the United States Department of Transportation, Federal Highway Administration (FHWA). This agreement requires DeMil and Fenton to adopt and implement an Ethics Code and Corporate Compliance Program; appoint a Corporate Compliance Officer; and retain an independent Monitor to evaluate the Company's performance of this Agreement and to submit periodic reports directly to the FHWA.
This settlement agreement is neither an admission of liability by Micheal DeMil , nor a concession by the United States that its claims are not well founded.
This case was investigated by the U.S. Attorney’s Offices for the Western District of Kentucky, Northern District of Georgia, Middle District of Georgia, Southern District of Georgia, Southern District of Indiana, and the Central District of Illinois. The matter was prosecuted by Assistant United States Attorney Benjamin S. Schecter in the Western District of Kentucky, Trial Attorney Kelley Hauser with the U.S. Department of Justice, Civil Division, Commercial Litigation Branch, Frauds Section, and was investigated by U.S. Department of Transportation Office of Inspector General (DOT-OIG) and the Federal Highway Administration’s Office of Civil Rights.
Louisville Man Charged with Enticement, Production and Possession of Child PornographyRead the Press Release
Thirteen-year-old alleged victim resided in Texas
Defendant is a Louisville high school teacher
LOUISVILLE, Ky. – A Louisville high school teacher and assistant coach with the school’s athletics department was arrested today and appeared before U.S. Magistrate Judge Dave Whalin, charged in a criminal complaint with violating child exploitation laws, announced Acting United States Attorney John E. Kuhn, Jr.
Patrick Newman, age 33, is charged with engaging in unlawful online communications with a 13-year-old male (“John Doe”). The two used social media applications VINE and KIK for their communications. Newman used a means or facility of interstate commerce to knowingly persuade, induce, entice or coerce John Doe to engage in sexual activity for which a person can be charged with a criminal offense. During the online communications, Newman used, persuaded, induced, enticed, or coerced a minor to engage in sexually explicit conduct for the purpose of producing any visual depiction of such conduct, knowing or having reason to know that such visual depiction would be transported or transmitted using any means or facility of interstate commerce. In addition, Newman is charged with possession of child pornography.
"At this point, the charges relate only to online activity," stated Acting U.S. Attorney John Kuhn. "Law enforcement has no information at present about criminal conduct other than online activity. These very disturbing allegations should underscore how important it is for parents to be aware of their children's internet activity. The Department of Justice is committed to our children’s safety and to prosecuting those who prey on the most vulnerable."
According to the Affidavit attached to the criminal complaint, on January 23, 2015, the National Center for Missing and Exploited Children received a CyberTip from Twitter, Inc. regarding the upload of 12 child pornography videos to VINE (a video sharing website owned by Twitter) and one image, uploaded from the same IP address in Texas, between 12-28-2014 and 12-30-2014.
Further, an investigation by a Texas Police Department revealed that a 13 year-old male had exchanged nude/sexually explicit photographs of himself with an adult male in March, 2015 using KIK messenger. John Doe further described several sexually explicit conversations with the adult male in which sexually explicit photographs and videos were traded between them. John Doe stated the adult male would instruct him to engage in various sexual acts and send videos/photos of the acts to him. John Doe stated that the individual sent him a facial picture and described the man as Caucasian, bald, with a dark beard. According to John Doe, the adult male told him he lived in Oklahoma. An investigation by Texas law enforcement revealed the IP address of the KIK account belonged to Louisville, Kentucky subscriber, defendant Patrick Newman.
A search warrant of Newman’s Louisville home was executed this morning by Homeland Security Investigations (HSI) within the Department of Homeland Security (DHS). Newman was arrested and is currently in the custody of the U.S. Marshals Service. A detention hearing is scheduled before Magistrate Judge Whalin Friday, June 5, 2015 at 1:30pm.
If convicted at trial, Newman faces a mandatory prison term of 15 years and up to and including a life sentence, and up to and including a life period of supervised release.
This case is being prosecuted by Assistant United States Attorney Jo E. Lawless and is being investigated by HSI Louisville Division of the Department of Homeland Security.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
***
The indictment of a person by a Grand Jury is an accusation
only and that person is presumed innocent until and unless proven guilty.
Fort Campbell Army Sergeant Charged with Taking Bribes While Serving in AfghanistanRead the Press Release
PADUCAH, Ky. – Acting United States Attorney John E. Kuhn, Jr. today announced charges against a Fort Campbell, Kentucky, Army Sergeant for his role as a public official, for conspiring with another to commit an offense against the United States, namely bribery.
According to the federal information, filed in U.S. District court today in Paducah, Kentucky, Ramiro Pena, Jr., age 43, received and accepted illegal bribes totaling $100,000 U.S. currency and a Rolex watch, in return for being influenced in the performance of an official act, that is, ensuring the successful approval and processing of contracts to restock supplies while serving at Humanitarian Air Yard (“HA Yard”) at Bagram Airfield (“Bagram”) in Afghanistan.
From January 1, 2008 through September 30, 2009, Pena worked as a U.S. Army Sergeant First Class at the HA Yard at Bagram as a Project Purchasing Officer (“PPO”) who maintained the supply orders and made sure the inventory levels were never low. Pena’s supervisor at the HA Yard was Army Master Sergeant Jimmy W. Dennis, who was charged and convicted in the Western District of Tennessee. Dennis was the Army Paying Agent at the HA yard and worked with Pena to procure supplies for the HA Yard by issuing contracts to local Afghan vendors for supplies.
Between June 5, 2008 and March 21, 2009, Dennis and Pena processed approximately 217 contracts worth approximately $30,760,255 for Afghan vendors to provide supplies to the HA Yard. According to the federal information, Pena and Dennis received money and jewelry from the vendors in return for their official acts on the HA Yard contracts.
Further, it is alleged that Pena received about $100,000 from Dennis in approximately six installments and a Rolex watch which was provided by a vendor seeking to obtain HA Yard contracts.
Pena allegedly sent approximately $22,000 of the bribe money home in greeting cards addressed to his wife who resided at Fort Campbell. He sent three to four bills totaling $300 to $400 in each card at a time so as to not bring attention to the envelope at the post office. It is further alleged that Pena used bribe money to purchase a Harley Davidson motorcycle and pay his and his family’s personal expenses in Afghanistan and in the United States.
If convicted at trial, Pena could receive the maximum punishment of five years in prison, a $250,000 fine, no more than three years of supervised release, and forfeiture to the United States of any property traceable to the conspiracy to commit bribery.
This case is being prosecuted by Trial Attorney Daniel P. Butler of the Department of Justice, Criminal Division, Fraud Section and by Assistant United States Attorney Nute A. Bonner. These matters were investigated by the Special Inspector General for Afghanistan Reconstruction, FBI, Army Criminal Investigative Division, Defense Criminal Investigative Service, and Air Force Office of Special Investigation.
***
The filing of a Criminal Information is an accusation only and that person is presumed innocent unless and until proven guilty.
New Albany, Indiana Man Charged with Interstate Transportation for ProstitutionRead the Press Release
LOUISVILLE, Ky. – Acting United States Attorney John E. Kuhn, Jr. today announced the indictment of a New Albany, Indiana, man on charges of interstate transportation for prostitution.
David McNeary, age 33, was charged by grand jury indictment on May 20, 2015. The indictment was unsealed yesterday during his initial appearance before Magistrate Judge Colin H. Lindsay. Today, during arraignment and detention hearing, Judge Lindsay placed McNeary on home detention with work release. McNeary was arrested Friday, May 22, 2015, in Jeffersonville, Indiana.
According to the indictment, between January 2014 and March 2014, McNeary, knowingly transported four different adult females during at least three different trips from Indiana to Kentucky, with the intent that they engage in prostitution.
If convicted at trial, McNeary could be sentenced to no more than ten years in prison for each count, no less than five years of supervised release and fined $250,000 for each count.
This case is being prosecuted by Assistant United States Attorney Amanda Gregory and is being investigated by the Federal Bureau of Investigation (FBI).
***
The indictment of a person by a Grand Jury is an accusation only and that person is presumed innocent until and unless proven guilty.
Justice Department Files Lawsuit to Permanently Bar Kentucky Man from Preparing Tax ReturnsRead the Press Release
WASHINGTON — The United States filed a complaint to permanently bar a Louisville, Kentucky, man and his business, NJ Mobile Tax Service, LLC, from preparing federal income tax returns for others, the Justice Department announced today.
According to the complaint, which was filed in the U.S. District Court of the Western District of Kentucky, Napoleon L. Jackson has prepared federal income tax returns that improperly understated his customers’ income tax liabilities. According to the suit, in a flyer for NJ Mobile, Jackson, offers to travel to his customers’ homes and prepare their tax returns. The flyer invites potential customers to “Let me do the numbers & I’ll even come to you,” and boasts that “[Jackson] can increase your chances for a higher return.”
The complaint alleges that Jackson understated his customers’ federal tax liabilities by, among other things:
- Falsely claiming deductions related to home ownership for taxpayers that did not own homes, including cases where Jackson prepared and filed returns from customers’ rental homes;
- Falsely claiming dependents, including listing Jackson’s relatives, as dependents on a customer’s tax return;
- Fabricating charitable contributions, and offering to falsify letters from a church that indicated the customers contributed $5,500 in cash to the church that the customers had not in fact donated; and
- Falsely claiming education credits for taxpayers who were not entitled to them.
The Internal Revenue Service (IRS) audited 31 tax returns that Jackson prepared on behalf of 20 customers for tax years 2010 and 2011. An examination of these 31 returns resulted in an increase in taxes owed for every return, according to the suit. The complaint further alleges that Jackson prepared at least 162 returns from 2010 to 2011, and continues to prepare returns today. Overall, the suit alleges that Jackson’s conduct may have cost the U.S. Treasury more than $800,000.
Return preparer fraud is one of the IRS’s Dirty Dozen Tax Scams for 2015. The IRS has some tips on its website for choosing a tax preparer, and has launched a free directory of federal tax preparers. In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers and tax scheme promoters. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on here. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Bowling Green, Kentucky, Convicted Felon Charged with Violating Federal Firearms LawsRead the Press Release
BOWLING GREEN, Ky. – Acting United States Attorney John E. Kuhn, Jr. today announced the arrest and initial appearance, in U.S. District Court, of convicted felon Jackie Lee Bowles, Jr., on charges of possession of a firearm and ammunition by a convicted felon.
Bowles, age 26, of Bowling Green, was arrested on federal charges following an alleged high-speed chase and armed standoff with law enforcement yesterday, in Bowling Green, Kentucky. Bowles was charged with the possession of a loaded, General Precision Corp., Model 20, .22 caliber revolver.
According to an affidavit filed with a federal criminal complaint, Bowles pointed a handgun at a self-identified police officer, threatened to shoot additional police officers in the head, and identified himself as a Captain with the Aryan Nation. Bowles is a convicted felon, having previously pled guilty in United States District Court to charges of possession and distribution of crack cocaine (case number 1:08cr40) on January 7, 2009. Bowles is currently on Supervised Release from that conviction.
Bowles was involved in a pursuit by police at a high rate of speed, after failing to stop his vehicle for an alleged traffic violation. He fled that vehicle on foot. Bowles was later approached by law enforcement when the officer recognized him as a passenger in a vehicle at a convenience store on Louisville Road in Bowling Green. A Warren County Sheriff’s Department Sergeant identified himself and at that time, Bowles allegedly raised a handgun and pointed it at the Sergeant. Other officers arrived and established a perimeter around Bowles’ vehicle and evacuated several surrounding businesses and locked down two area schools. During this time, Bowles made several phone calls. During one of the calls, he could be heard by law enforcement officials saying “I’ll have to shoot them in the head.” Bowles is alleged to have made the comment as officers arrived with visible body armor.
Bowles is in the custody of the U.S. Marshals Service.
This case is being prosecuted by Assistant United States Attorney Jo E. Lawless and is being investigated by ATF, in conjunction with the Warren County Sheriff’s Office and Kentucky State Police.
***
The indictment of a person by a Grand Jury is an accusation only and that person is presumed innocent until and unless proven guilty.
Evansville, Indiana Man Charged with Transportation of an Owensboro, Kentucky Minor to Engage in Criminal Sexual ActivityRead the Press Release
Bowling Green, Ky. – An Evansville, Indiana man was detained and remanded to the custody of the U.S. Marshals following a detention hearing yesterday, before Magistrate Judge H. Brent Brennenstuhl, on charges of the transportation of a minor to engage in criminal sexual activity, announced Acting United States Attorney John E. Kuhn, Jr.
Zachery Andrew Coleman, age 27, was arrested on May 5, 2015, on federal charges, following an investigation by members of the Daviess County, Kentucky Sheriff’s Office (DCSO), the Evansville, Indiana Police Department and the FBI. According to an Affidavit in support of the Criminal Complaint, on or about February 6, 2015, a minor female of twelve years of age, left her residence in Owensboro, Kentucky with Coleman, was taken to the defendant’s home in Evansville, Indiana, and was returned to the minor’s residence the next day. Coleman is alleged to have engaged in criminal sexual activity with the minor during that time. According to the Affidavit, Coleman communicated with the minor on a social networking site called Mylol and allegedly sent sexually explicit messages to the minor using the screen name Swisher812. Conversations obtained via a search of the minor’s computer show Coleman arranged to pick up the minor at the minor’s home for the purposes of transporting the minor to engage the child in illegal sexual activities.
If convicted at trial, Coleman faces a statutory mandatory minimum of 10 years and a maximum of life imprisonment, a fine of $250,000, and supervised release of not less than 5 years and not more than life.
This case is being prosecuted by Assistant United States Attorney A. Spencer McKiness, and is being investigated by the Federal Bureau of Investigation (FBI) with assistance from the Daviess County, Kentucky Sheriff’s Office, and the Evansville, Indiana Police Department.
***
The indictment of a person by a Grand Jury is an accusation only and that person is presumed innocent until and unless proven guilty.
Monroe County, Kentucky, Tobacco Farmer Guilty of Crop Insurance FraudRead the Press Release
Fraud totaled $711,958
BOWLING GREEN, Ky. - A Monroe County, Kentucky tobacco farmer pleaded guilty in U.S. District Court in Bowling Green yesterday, before District Judge Greg N. Stivers, to charges of crop insurance fraud totaling $711,958 announced Acting U.S. Attorney John E. Kuhn, Jr.
According to the plea agreement, Tracy E. Dillard, 45 of Fountain Run, Kentucky aided and abetted by others, admitted in court today of knowingly making false statements and reports on insurance claims submitted to Producers Agriculture Insurance Company, a company insured by the Federal Crop Insurance Corporation (FCIC).
“The federal crop insurance program ultimately exists to provide a safety net for our farming community,” stated Acting U.S. Attorney John Kuhn. “Fraud undermines the entire program. This U.S. Attorney’s Office is committed to working with our partner federal agencies to ensure that every penny of taxpayer money is fully restored.”
The violations occurred between 2009 and March 10, 2011, in the Western District of Kentucky, including Allen, Barren, Hart and Monroe Counties in Kentucky, and Macon County in Tennessee.
Specifically, in 2009 Dillard had four separate crop insurance policies on four different crops, two in Barren County, and two in Monroe County. Aided and abetted by others, Dillard intentionally overstated crop damage for each crop by forty percent (40%) on a crop insurance claim form, resulting in a loss of $125,339.20.
Additionally, in 2010 Dillard had twelve separate tobacco crop insurance policies on twelve different crops. Dillard, aided and abetted by others, intentionally overstated crop damage by forty percent (40%) for each crop on a crop insurance claim form, resulting in a loss of $504,454.80.
Finally, in 2011 Dillard had a crop insurance policy on a crop located in Allen County. Aided and abetted by others, Dillard intentionally falsified the crop plant date on a crop insurance claim form, resulting in a loss of $82,164.
The FCIC indemnifies insurance companies for crop insurance claims.
For the 2009, 2010, and 2011 policies listed above, Dillard caused fraudulent claims to be submitted to the United States government, through claims made to ProAg and paid by the FCIC, resulting in a $711,958 loss to the United States. Dillard agreed to pay full restitution under the terms of his plea agreement.
Dillard faces no more than 30 years in prison, a fine of $1,000,000 and a five year period of supervised release.
This case is being prosecuted by Assistant United States Attorney David Weiser and is being investigated by the United States Department of Agriculture (USDA) Office of Inspector General (OIG) and the Risk Management Agency, Special Investigation Branch.
Louisville Tax Preparer Sentenced for Filing False Federal Tax Returns and Diverting Client Funds Without Their KnowledgeRead the Press Release
LOUISVILLE, Ky. – Acting United States Attorney John E. Kuhn, Jr., and Christopher A. Henry, Special Agent in Charge, IRS-Criminal Investigation announced today that Elizabeth A. Lawless, 66, of Louisville, Kentucky, was sentenced this week by Senior District Judge Thomas B. Russell to 6 months in prison, followed by 3 years of supervised release, and ordered to pay restitution in the amount of $329,465 to the IRS.
On November 7, 2014, Lawless pleaded guilty to all counts of a 24-count indictment filed on October 1, 2013, charging her with wire fraud, and aiding and assisting in the preparation of false federal income tax returns.
Beginning in or around February 2010 and continuing through April 2012, Lawless prepared fraudulent tax returns for clients through her business, Lawless BK and Tax, by creating false education credits and fabricating itemized deductions for medical expenses, charitable contributions, and unreimbursed employee business expenses. Lawless did not notify her clients that she was falsifying deductions and credits and did not review her clients' tax returns with them, other than informing them of the amount they were to receive as a refund. As such, her clients were unaware that their returns were fraudulent. From February 2010 to April 2012, the fraudulent returns filed by Lawless, on behalf of her clients, resulted in tax loss of approximately $231,303.
Further, Lawless diverted substantial portions of her clients' fraudulent tax refunds to her own bank account. After the fraudulent tax returns were filed, Lawless provided copies of tax returns to her clients, advising them they were the returns that were filed with the Internal Revenue Service ("IRS"). In many cases, the returns Lawless provided to clients differed from the returns that were actually filed with the IRS, in that the filed returns contained additional fraudulent credits and deductions, resulting in larger refunds. Without her clients’ knowledge or consent, Lawless filed Forms 8888 along with the fraudulent returns so that a portion of the refunds would be deposited in her bank account, while deposits for the amounts indicated on the copies of the tax returns (Lawless provided to the clients) were deposited into the clients' accounts. From February 2010 to April 2012, Lawless diverted approximately $127,553 from her clients' fraudulent tax refunds to her own bank account.
This case was prosecuted by Assistant United States Attorney Amanda E. Gregory and was investigated by the Internal Revenue Service-Criminal Investigation.
Louisville Resident Sentenced to 48 Months in Prison for A Scheme to Obtain Fraudulent Federal Income Tax Refunds Using Stolen IdentitiesRead the Press Release
Ordered to pay $94,159 in restitution
LOUISVILLE, Ky. – Acting United States Attorney John E. Kuhn, Jr. and Christopher A. Henry, Special Agent in Charge, IRS-Criminal Investigation announced today that Erica Spencer, 37, of Louisville, Kentucky, was sentenced this week by Senior District Judge Thomas B. Russell to 48 months in prison, to be followed by 3 years of supervised release, and ordered to pay $94,159 in restitution.
On November 7, 2014, Spencer pled guilty to all counts of a 31-count second superseding indictment filed on October 22, 2014. She was charged with theft of public money, unauthorized use of access devices, wire fraud, and aggravated identity theft. The original indictment in this case was filed on December 18, 2013.
From June 2011 through June 2012, Spencer used the identities, including names, dates of birth, and social security numbers, of several individuals to file fraudulent federal income tax returns in their names and to receive fraudulent federal income tax refunds. Further, Spencer received the fraudulent federal tax refunds in bank accounts she controlled.
This case was prosecuted by Assistant United States Attorney Bryan R. Calhoun of the Western District of Kentucky and was investigated by the Internal Revenue Service-Criminal Investigation.
Former Chairman of Louisville Episcopal Church Education Foundation and His Spouse Sentenced to Prison for Embezzling More Than $1.1 Million from the CharityRead the Press Release
Foundation Chairman laundered money through his wife’s business
LOUISVILLE, Ky. – Charles Muir, the former chairman of the Woodcock Foundation, and his wife, Diana Muir, former owner of DBM-Dental Direct of Louisville, were sentenced today, by Senior Judge Thomas B. Russell, to serve prison terms for the interstate transportation of stolen property and money laundering totaling $1,141,030, from the Louisville Episcopal Church Education Foundation, announced Acting U.S. Attorney John E. Kuhn, Jr.
“This crime was an act of staggering selfishness,” stated Acting U.S. Attorney John Kuhn. “The Muirs stole money from a charity that gave college scholarships to economically disadvantaged students. In effect, they were stealing college money from needy and deserving young people. And to make matters worse, their actions undermined the trust and confidence of generous and good-hearted donors who wanted to make a difference through contributions to an educational charity.”
Charles Muir, age 62, was sentenced to 46 months in prison followed by one year of supervised release and Diana Muir, age 61, was sentenced to six months in prison followed by one year of supervised release. Both are from Louisville and previously admitted in court, that between April 2007 and June 2011, they unlawfully transferred or caused to be transferred in interstate commerce approximately $1,141,030 of funds that had been stolen or taken by fraud from the Woodcock Foundation. The funds were transferred from Your Community Bank in Louisville, Kentucky, to locations outside of Kentucky. The $1,141,030 was taken without authority from the Woodcock Foundation, a charitable trust providing college scholarships in the Louisville, Kentucky area. In addition the defendants conducted financial transactions involving the proceeds of the $1,141,030 by depositing checks from the Woodcock Foundation into the Your Community Bank account of DBM Dental to disguise the nature of the transactions.
According to court records, during the four year period of conduct, the couple withdrew approximately $262,000 by ATM at a casino in Indiana and in total withdrew more than $365,000 in cash.
From April 2007 through June 2011, Charles Muir was the chairman of the Woodcock Foundation, a charitable organization associated with the Episcopal Church of Louisville, Kentucky. During the same timeframe, Diana Muir owned and controlled DBM.
This case was prosecuted by Assistant United States Attorneys Bryan Calhoun and Jason Snyder, and was investigated by the United States Secret Service and the Criminal Investigation Division of the Internal Revenue Service.
Former Bookkeeper at Saint Gabriel the Archangel Church and School Sentenced to Six Months Home Detention for Embezzling FundsRead the Press Release
Agreed to restitution in the amount of $83,191 to the Louisville Parish
LOUISVILLE, Ky. – The former bookkeeper at Saint Gabriel the Archangel Church and School was sentenced in U.S. District Court today, by Senior District Judge Thomas B. Russell, to six months home detention as part of a three year term of probation and was ordered to pay restitution in the amount of $83,191 to the Louisville Parish announced Acting United States Attorney John E. Kuhn, Jr.
Tammy Goodlett, 49, of Louisville, admitted in court to devising a scheme to defraud Saint Gabriel. According to the single count indictment, Goodlett committed wire fraud when, as bookkeeper, she exceeded her authorized access by transferring funds from Saint Gabriel’s bank account to her own bank accounts, made unauthorized credit card expenditures, and manipulated financial records to make unpaid debts appear paid. The fraud to obtain funds and services to which she was not entitled began on or about August 13, 2010, and continued to on or about August 6, 2013. Specifically, Goodlett used Saint Gabriel’s credit card for personal expenses, such as concert tickets, without authorization. Also, Goodlett admitted to manipulating Saint Gabriel’s financial records to make it appear that she had paid her daughter’s school tuition at Saint Gabriel when she had not made the payments.
Goodlett has paid $11,757 toward the total restitution and currently owes $71,439.18 to the Louisville parish.
This case was prosecuted by Assistant United States Attorney Stephanie Zimdahl and was investigated by the United States Secret Service and the Louisville Metro Police Department.
Louisville Man Charged with Robbing Seven Pharmacies Located in Jefferson County, KentuckyRead the Press Release
LOUISVILLE, Ky. – A Louisville man was charged today, by a federal grand jury, with robbing seven pharmacies located in Jefferson County, Kentucky, including carrying a firearm during one of the robberies, announced Acting United States Attorney John E. Kuhn, Jr.
Matthew Williams was charged in an eight count indictment with robbing the pharmacies beginning on September 13, 2013 through January 2, 2014, when he was arrested by Metro Louisville Police.
According to the indictment, Williams allegedly robbed the following pharmacies: the CVS Pharmacy located at 3229 Poplar Level Road, Louisville, Kentucky, by means of actual and threatened force, violence, and fear of immediate injury to an employee, on September 13, 2013; the Walgreen’s Pharmacy located at 12101 Shelbyville Road in Middletown, by means of actual and threatened force, violence, and fear of immediate injury to an employee on September 28, 2013, October 26, 2013, December 20, 2013, and January 2, 2014. During the alleged robbery on January 2, 2014, Williams is further charged with carrying a firearm. Additional alleged robberies occurred at the CVS Pharmacy located at 13900 Shelbyville Road, in Louisville, on September 29, 2013, and the Walgreen’s Pharmacy located at 2368 Frankfort Avenue, in Louisville, on November 6, 2013.
If convicted at trial, Williams could be sentenced to no more than 20 years for counts 1-7, and no less than 5 years for count 8. Further, Williams could be required to pay a fine of $2,000,000 and serve a period of supervised release. Kentucky Circuit Court charges against Williams will be dismissed in lieu of the federal charges taken today.
This federal prosecution stems from “Project Recoil,” the ongoing partnership of multiple law enforcement agencies, developed by The U.S. Attorney’s Office for the Western District of Kentucky, to maximize penalties for the most violent repeat offenders, and to reduce violent crime in our community.
This case is being prosecuted by Assistant United States Attorney Thomas W. Dyke, and is being investigated by the Louisville Metro Police Department.
***
The indictment of a person by a Grand Jury is an accusation only and that person is presumed innocent until and unless proven guilty.
Bowling Green, Armed Career Criminal Pleads Guilty to Conspiracy to Possess and Distribute Marijuana and Cocaine, and Possession of A Firearm by A Convicted FelonRead the Press Release
BOWLING GREEN, Ky. – A Bowling Green armed career criminal pleaded guilty to several charges today in U.S. District Court, including conspiracy to possess and distribute marijuana, cocaine and cocaine base, possession of a firearm by a convicted felon, and maintaining a residence for the purpose of distributing controlled substances, announced Acting United States Attorney John E. Kuhn, Jr.
Antwain Santez Sweatt pleaded guilty before U.S. District Court Judge Greg N. Stivers this morning to five charges in a seven count superseding indictment from December 10, 2014. According to the plea agreement, between June and July 2014, in Warren County, Kentucky, Sweatt knowingly conspired with others to possess with intent to distribute and distribute marijuana, cocaine and cocaine base. Further, Sweatt admitted to renting 834 Victoria Street, in Bowling Green, for the purpose of distributing or using controlled substances. Finally, Sweatt admitted to knowingly possessing a Jiminez Arms, 9 millimeter pistol and ammunition, after having been convicted of a crime punishable by imprisonment for more than one year.
On March 10, 1997 Sweatt was sentenced to 7 years in prison for trafficking in a controlled substance and possession of a controlled substance. On February 3, 2003, Sweatt was sentenced to 10 years in prison for trafficking in a controlled substance and 15 years in prison for disarming a police officer and resisting arrest.
Sweatt faces a combined minimum term of 15 years in prison, a combined maximum term of life imprisonment, a combined maximum fine of $3,750,000, and supervised release of at least three years and up to any number of years, including life, which the Court may specify. Sweatt is scheduled for sentencing before Judge Stivers on July 14, 2105, in Bowling Green.
This case is being prosecuted by Assistant United States Attorney Jo E. Lawless and is being investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) the Bowling Green Police Department, and the Bowling Green/Warren County Drug Task Force.
Nolin Rural Electric Cooperative Corporation of Elizabethtown, Kentucky, Enters A Non-Prosecution Agreement and Civil Settlement with the United States Related to Fort Knox BillingsRead the Press Release
Nolin RECC agrees to pay $7,619,333
LOUISVILLE, Ky. - Acting United States Attorney John E. Kuhn, Jr. announced today that the United States has entered into a Non-Prosecution Agreement with Nolin Rural Electric Cooperative Corporation (Nolin RECC) of Elizabethtown, Kentucky, related to bills submitted to Fort Knox under an Army energy-saving program. Under the terms of the agreement, Nolin RECC will pay the United States $2,619,333 as part of a civil settlement, and will forfeit an additional $5 million to the United States Marshals Service, for a total settlement amount of $7,619.333. In addition, Nolin RECC has agreed to employ a corporate ethics monitor for two years to oversee its dealings with the federal government.
“The Agreements we announce today result from an extensive investigation of the Ft. Knox energy program,” stated Acting United States Attorney John Kuhn. “The investigation uncovered criminal acts and millions of dollars in questionable payments. We have vigorously pursued justice by prosecuting responsible parties and now, with these Agreements, recovering over $7.6 million in questionable payments. The settlement also brings about an important correction to ensure compliance with program requirements going forward.”
Brian J. Reihms, Defense Criminal Investigative Service (DCIS) Special Agent-in-Charge, stated, “DCIS is dedicated to working with our investigative partners to investigate the conduct of DoD officials and contractors and ensuring the integrity of the procurement system.”
As part of the civil Settlement Agreement and the Non-Prosecution Agreement, the United States and Nolin RECC agreed to the relevant facts in Appendix A to the Non-Prosecution Agreement, which describes the conduct in question. In exchange for the total civil settlement amount of $2,619,333, the United States has released civil claims under the False Claims Act, the Procurement Integrity Act, the Program Fraud Civil Remedies Act and common law causes of action.
In 1996, Nolin RECC and Fort Knox entered into a Utility Energy Service Contract (UESC), which authorized and enabled Fort Knox and Nolin RECC to undertake energy saving projects. Each project was called an Energy Conservation Opportunity (ECO). Since 1996, Fort Knox awarded 108 ECOs to Nolin RECC, which were intended to make Fort Knox more energy efficient and were cumulatively valued at approximately $270 million. By design, the projected savings associated with each ECO project were intended to offset the cost of each project.
In early 2010, Nolin RECC billed Fort Knox $199,020 for work performed and expenses incurred related to a proposed waste-to-energy project that was never approved for implementation. Because the proposed ECO was not approved, Nolin RECC submitted a bill for expenses under another unrelated ECO that had been approved. $398,040, representing double damages for these unauthorized expenses, has been recovered by the United States as part of the civil settlement.
Similarly, in 2010, Nolin RECC worked on a Sample Solar Panel Project at Fort Knox. Although this project was never authorized or approved by the Fort Knox Contracting Officer, Nolin RECC billed the Sample Solar Panel Project costs of $94,178 under three unrelated but previously authorized ECOs. $12,394, representing double damages on Nolin RECC’s profits, has been recovered by the United States as part of the civil settlement.
Pursuant to ECOs 70 and 102, Nolin RECC became involved in the extraction of natural gas from Fort Knox land. Pursuant to those ECOs, Nolin RECC was authorized to bill Fort Knox for the gas at a specified rate. Notwithstanding the ECO rate definition, Nolin RECC billed Fort Knox in excess of the rate allowed by the ECOs, adding an additional sum characterized as "Retained Savings." This additional billing amounted to $800,089 more than the amount authorized by the ECOs. As part of the civil settlement, Nolin has agreed that Fort Knox will receive credit for these payments.
Nolin RECC understood that the Army required that all ECOs pay for themselves within ten years. Between 2002 and May 2008, Nolin RECC presented pro formas to the Army for twenty proposed ECOs which gave the impression that these twenty ECOs paid for themselves within ten years and were projected to save over $7 million in ten years. In fact, these twenty ECOs were actually projected to lose over $15 million over ten years. None of these twenty ECOs paid for themselves within ten years, and therefore, they should not have been authorized by the Army. These twenty ECOs resulted in over $8,000,000.00 in payments to Nolin RECC. Nolin RECC is forfeiting $5,000,000 to the United States as a result of the improperly authorized ECOs.
Nolin RECC has also paid double damages to the United States in connection with hiring Gary T. Meredith as its Resource Energy Manager (REM). Before becoming Nolin RECC's REM in August 2007, Meredith was employed by Fort Knox as its Energy Program Manager, working closely with Nolin RECC in that capacity for more than a decade.
The ECO for the REM position required Nolin RECC to comply with the Joint Ethics Regulations (Regulations which incorporate ethics statutes Meredith is charged with violating). The United States will recover $1,408,810, double the amount Nolin RECC received to pay Meredith for the REM position. Meredith is currently charged in a 38-count federal superseding indictment with conflict of interest and wire fraud for actions he took as an Army employee and as the Nolin RECC REM. His case is set for trial on December 1, 2015. Meredith’s co-defendant, Matthew Bowman, a former Army attorney, pleaded guilty on October 1, 2014, to providing a false written statement to a DCIS Special Agent investigating Meredith.
On September 8, 2014, the Department of Defense, Office of Inspector General (DoD OIG) issued an audit report that documented the results of an independent audit conducted on Ft. Knox’s energy program. The audit concluded that “Fort Knox officials did not properly award and administer 108 task orders, valued at about $270 million, for energy-saving projects. In addition, Fort Knox officials could not support the claim that projects achieved the projected energy savings. The audit further found that “the lack of adequate internal controls increases the risk of fraud, waste, and abuse.” The full audit can be viewed here: http://www.dodig.mil/reports.html/Article/1119054/fort-knox-and-the-army-need-to-improve-internal-controls-for-utility-energy-ser/
This agreement is neither an admission of liability by Nolin RECC nor a concession by the United States that its claims regarding the covered conduct are not well-founded.
The legal work for the criminal investigation and matter was handled by Assistant United States Attorney David Weiser, the civil matter by Assistant United States Attorney William F. Campbell, and the forfeiture by Assistant United States Attorney Amy Sullivan. The investigation was conducted by the Defense Criminal Investigative Service, Dayton Resident Agency. The Defense Contract Audit Agency and Army Criminal Investigations Command also supported the investigation.
California Felon Convicted of Conspiracy and Distribution of Methamphetamine in Western KentuckyRead the Press Release
Nearly 4 pounds of pure meth found hidden inside SUV engine
Faces up to life in prison
PADUCAH, Ky. – A felon from the Los Angeles, California area was convicted by a federal jury in Paducah, Kentucky, recently of conspiracy to distribute and distribution of methamphetamine in McCracken County, announced Acting United States Attorney John E. Kuhn, Jr.
“Methamphetamine continues to destroy so many lives; it has become a toxic scourge within our communities,” stated U.S. Attorney John Kuhn. “This conviction helps by putting a drug dealer behind bars and removing pounds of this poison from our streets.”
Jose Manuel Jimenez, age 34, of Hemet, faces a mandatory minimum sentence of twenty years in prison and could be sentenced to life in prison for his role in attempting to distribute nearly four pounds of pure methamphetamine with a street value of $160,000. There is no parole in the federal system.
The trial lasted three days and jurors deliberated under one hour before returning a guilty verdict on April 8, 2015, on both counts of the October 14, 2014, superseding indictment. Jimenez is in the custody of the U.S. Marshals Service and will be sentenced before Senior Judge Thomas B. Russell.
Evidence presented at trial included photographs of the methamphetamine hidden inside the engine of a Dodge Durango SUV and cellular phone records. Testimony indicated that the meth had been shipped to Western Kentucky from Arkansas, but the shipment may have originated in Southern California.
Co-defendant Rodolfo Benitez pleaded guilty to possession with the intent to distribute meth, on July 22, 2014 and is scheduled for sentencing on April 14, 2015 at 12:30pm before Senior Judge Russell.
This case was prosecuted by Assistant United States Attorneys Larry E. Fentress and Nute A. Bonner and was investigated by the McCracken County Sheriff’s Department and the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF).
Monroe County, Kentucky, Farmer Charged with Crop Insurance FraudRead the Press Release
LOUISVILLE, Ky. - A Monroe County, Kentucky farmer was charged in a federal Information today, with crop insurance fraud announced Acting U.S. Attorney John E. Kuhn, Jr.
According to the Information, Tracy E. Dillard, 45 of Fountain Run, Kentucky aided and abetted by others, knowingly made false statements and reports on applications for insurance. Dillard allegedly made false statements for the purpose of influencing the actions (insurance payments) of the Federal Crop Insurance Corporation and Producers Agriculture Insurance Company, a company insured by the Federal Crop Insurance Corporation.
The alleged violations occurred between August 26, 2010,and March 10, 2011, in the Western District of Kentucky, Allen County, Kentucky, and elsewhere.
If convicted at trial, Dillard faces no more than 30 years in prison, a fine of $1,000,000 and a five year period of supervised release.
This case is being prosecuted by Assistant United States Attorney David Weiser and is being investigated by the United States Department of Agriculture (USDA) Office of Inspector General (OIG).
***
The indictment of a person by a Grand Jury is an accusation only and that person is presumed innocent until and unless proven guilty.
Cincinnati Man Sentenced for Operating Sex Trafficking Scheme in Ohio and KentuckyRead the Press Release
Defendant Used Violent Assaults and Physical Restraints to Compel Young Women to Engage in Prostitution for the Defendant’s Profit
WASHINGTON – Senior U.S. District Judge John G. Heyburn II of the Western District of Kentucky sentenced Cincinnati resident, Christopher Hisle, 45, to serve 180 months in prison and 10 years of supervised release, the Justice Department announced today. Restitution will be determined at a future date. Hisle pleaded guilty on Nov. 14, 2014, to sex trafficking by force, fraud and coercion, and to enticing individuals to travel in interstate commerce for prostitution and transporting individuals in interstate commerce for prostitution.
Police arrested Hisle on April 8, 2014, in Louisville, Kentucky, after he drove a young woman from Cincinnati to Louisville to engage in prostitution at a Louisville motel. Subsequent investigation linked Hisle to the prostitution of multiple additional women in Ohio, Kentucky and elsewhere.
According to the evidence presented in court proceedings and documents filed in the case, Hisle physically assaulted several of the young women he exploited for prostitution, including striking one of the victims in the face when she threatened to run away. In furtherance of his sex trafficking scheme, Hisle controlled the women he prostituted by various means, including boards and locks which restricted the women’s ability to exit the dwelling where Hisle housed them when he was not transporting them for prostitution.
“This defendant preyed on vulnerable young victims and cruelly exploited them for his profit,” said Acting Assistant Attorney General Vanita Gupta of the Justice Department’s Civil Rights Division. “This sentence sends a clear message that the United States will not tolerate modern-day slavery and will work tirelessly to restore the rights and dignity of the victims of this crime.”
“The horrors of human trafficking cause unimaginable pain, desperation and despair,” said Acting U.S. Attorney John E. Kuhn Jr. of the Western District of Kentucky. “And the fear of violence and other reprisals all too often keep victims from reporting this heinous crime. My office is working hard to train our law enforcement partners so that we can recognize this tragic situation and then bring justice with a solid sentence for the defendants and an order of restitution for victims.”
“Protecting the civil rights of every individual in our community is one the FBI’s top criminal priorities,” said Special Agent in Charge Howard S. Marshall of the FBI’s Louisville Office. “We work closely with community leaders and our law enforcement partners to proactively target predators involved in human trafficking. These women were exploited as a reusable commodity by men that forced them to participate in the sex trafficking industry. Our agents and task force officers work tirelessly to address every civil rights allegation we receive; I am proud of the hard work they do to protect and rescue the victims that are unable to defend themselves.”
This case was investigated by the FBI and was prosecuted by Assistant U.S. Attorney Amanda E. Gregory of the Western District of Kentucky and Trial Attorney William Nolan of the Civil Rights Division’s Human Trafficking Prosecution Unit.
Former University of Louisville Executive Sentenced to 63 Months in Prison for Tax Fraud and Embezzling Funds Tied to UofL Medical GroupsRead the Press Release
Diverted $2.8 million for his personal use
Failed to report $2,470,735 to Internal Revenue Service
Ordered to pay $2,810,201.53 in restitution
LOUISVILLE, Ky. – A former University of Louisville accountant, promoted to Executive Director of the Department of Family & Geriatric Medicine at the University of Louisville School of Medicine (DFGM) was sentenced today, in U.S. District Court, by Senior District Judge Charles R. Simpson III, to 63 months in prison and ordered to pay $2,810,201.53 in restitution for tax fraud and embezzling funds tied to University of Louisville medical groups, announced Acting U.S. Attorney John E. Kuhn, Jr.
As part of the nearly six year scheme, Perry Chadwick Vaughn, 37, of Sellersburg, Indiana, diverted contractual checks and patient payments to the University Family and Geriatric Medicine Associates account then withdrew $2,809,489 for his personal use and benefit.
“Mr. Vaughn took advantage of his position of trust to steal from one of our most valued public institutions, the University of Louisville, as well as University-affiliated physician practice groups that serve the community by providing geriatric and primary care health care services,” stated Acting U.S. Attorney John E. Kuhn, Jr. “The 2.8 million dollar loss in this case is another dramatic reminder of what can happen when raw, unmitigated greed and selfishness finds opportunity in an organization with inadequate fiscal oversight. We do hope that the University’s recent and ongoing efforts to improve its financial management will end the string of thefts and embezzlements it has suffered over recent years. I must also commend the University of Louisville Police Department for providing invaluable assistance to the federal law enforcement agencies during the investigation.”
“As we investigate these insider threat cases where trusted employees steal from their employers, we will continue to urge business owners to have independent third party reviews of their finances. The US Secret Service and its Kentucky Electronic Crimes Task Force partners will vigilantly investigate these criminals to be sure they are brought before the justice system, making every attempt to make victims whole and to ensure these crimes do not go unpunished,” stated Acting Special Agent in Charge Craig Hutzell, United States Secret Service, Louisville.
Vaughn previously pleaded guilty to a seven-count federal indictment which included charges of theft and bribery in programs that receive federal funds, money laundering, mail fraud, and filing false federal income tax returns.
Specifically, from January 2007 through August 2013 Vaughn defrauded the Department of Family and Geriatric Medicine at the University of Louisville School of Medicine (DFGM-UofL) and its affiliated private physician practice groups (collectively “DFGM-Practice Groups”). While working as the executive director for DFGM-UofL and the business manager form DFGM-Practice Groups Vaughn stole approximately $2,810,201.53 through the use of the United States mail. Vaughn fraudulently stole contractual checks issued to DFGM-UofL totaling $666,810.11. Vaughn also stole $604,025.57 in patients payments to DFGM-UofL. In addition Vaughn stole another $1,538,654.24 directly from DFGM-Practice Groups’ accounts. During the scheme Vaughn caused T.J. Samson Community Hospital to mail a check for $37,750 that he ultimately stole.
During the course of the scheme to defraud both DFGM-UofL and DFGM-Practice Groups Vaughn concealed his theft through a number of means including the following: he created false bank reconciliations to hide the issuance of checks to himself and he created false bank statements to hide the issuance of checks to himself. In all instances, the financial transactions were conducted with Republic Bank and Chase Bank, federally insured financial intuitions.
On February 19, 2009, Vaughn knowingly filed a false U.S. Individual Tax return for calendar year 2008 in that it failed to report $377,492 in total income. On January 31, 2010, Vaughn knowingly filed a false U.S. Individual Tax return for calendar year 2009 in that it failed to report $610,470 in total income. On February 22, 2011, Vaughn knowingly filed a false U.S. Individual Tax return for calendar year 2010 in that it failed to report $160,121 in total income. On January 23, 2012, Vaughn knowingly filed a false U.S. Individual Tax return for calendar year 2011 in that it failed to report $546,022 in total income. On March 21, 2013, Vaughn knowingly filed a false U.S. Individual Tax return for calendar year 2012 in that it failed to report $776,660 in total income. Each of the returns was verified by a written declaration that it was made under the penalty of perjury and Vaughn knew in each instance that he was omitting reportable taxable income.
This case was prosecuted by Assistant United States Attorney Bryan Calhoun and was investigated by the University of Louisville Police Department, the United States Secret Service, the Internal Revenue Service, Criminal Investigations, and the United States Postal Inspection Service.
Former Owner of Health PMO Serves Nearly Four Years in Prison for Illegal Distribution of Drugs and Money LaunderingRead the Press Release
-Websites were used to dispense pharmaceutical drugs without prescriptions
LOUISVILLE, Ky. – The former owner of Health PMO was sentenced to time served, of 45 months in prison, and ordered to pay $20,000 in restitution by Senior Judge Charles R. Simpson, III in U.S. Federal Court today, for conspiring to illegally distribute and dispense controlled substances, wire fraud, and conspiring to commit money laundering, announced Acting U.S. Attorney John E. Kuhn, Jr.
Stacy Allen Taylor, age 47, of Louisville, pleaded guilty to the charges on October 22, 2014, in U.S. District Court. Taylor admitted that between March of 2008 and March of 2009, he conspired and agreed with others to distribute and dispense prescription drugs, by setting up an internet pharmacy to dispense controlled substances to customers without valid prescriptions. Taylor used various web site addresses including www.RXvaluePharm.com to distribute and dispense hundreds of orders for prescription drugs, throughout the United States each day, generating sales of Schedule II, III, and IV controlled substances for a profit that totaled $790,753.51.
“Many of these drugs had a high potential for abuse and dependence,” stated Acting U.S. Attorney John Kuhn. “Without a license to prescribe or dispense prescription drugs, Taylor was no more than a drug dealer with a website. We hope and expect today’s sentence will be a deterrent to those who might consider trying to conduct illegal pharmaceutical sales using the internet.”
According to court documents, customers were not required to provide prescriptions from a practitioner, licensed by law, to administer such drugs before dispensing the controlled prescription drugs. Instead, Taylor permitted customers to fill out forms or provide information to telemarketing sales agents, allowing customers to choose the type and quantity of controlled substances and other prescriptions they wished to purchase. Over time, Taylor approved every order for which a valid credit card was provided and unlawfully distributed hundreds of prescriptions drugs on a daily basis. At no time was Taylor licensed to practice medicine or pharmacy by the Commonwealth of Kentucky.
As part of this scheme, Taylor admitted that beginning in March 2008, and continuing until at least March 2009, he committed wire fraud. Taylor conspired with others to conduct financial transactions affecting interstate and foreign commerce which involved the proceeds of unlawful activity, namely, the unlawful distribution and dispensing of, and conspiracy to distribute and dispense, controlled substances and other substances. To accomplish this, Taylor and his co-conspirators sent wire transfers from a Health PMO Class Act Federal Credit Union account to an account at the Federal Bank of the Middle East, Ltd., Nicosia, Cypress. These wire transfers were from the proceeds of selling and distributing controlled substances and other drugs to customers in the United States and other locations.
Further, Taylor admitted to knowingly engaging in a scheme to defraud investors of Health PMO beginning in June 2008. This scheme was used to obtain money and property by soliciting and receiving money from individuals by promising them stock in Health PMO. Taylor falsely represented and promised to provide investment interest (stock) in Health PMO. Instead, Taylor used the funds received for his personal benefit and gain.
The case was prosecuted by Assistant United States Attorney Lettricea Jefferson-Webb, and was investigated by the U.S. Food and Drug Administration Office of Criminal Investigations and the United State Postal Inspection Service.
Warren County, Kentucky, Woman Sentenced to 72 Months for Setting Fire to the Horse Cave, Kentucky, Dollar General StoreRead the Press Release
BOWLING GREEN, Ky. – A Warren County, Kentucky, woman was sentenced to 72 months in prison followed by 3 years of supervised release by Chief District Judge Joseph H. McKinley, Jr., for maliciously damaging and destroying and attempting to damage and destroy, by means of fire, the Dollar General Store, and the personal property, located in Hart County, Kentucky, announced Acting U.S. Attorney John E. Kuhn, Jr.
Debra Fowler Kessinger, age 58, of Smiths Grove, Kentucky, was convicted on November 21, 2014, of setting a fire on June 27, 2011, that destroyed the Dollar General Store located at 1015 East Main Street in Horse Cave, Kentucky. Following the week-long trial, the federal jury in Bowling Green, deliberated for a little over two hours before reaching its unanimous verdict.
“This defendant not only devised a scheme to defraud her employer, but then attempted to torch a commercial building in order to cover her tracks. The Jury’s conviction and today’s sentence is the result of outstanding collaborative work of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) and the Western Kentucky Arson Task Force,” stated Acting U.S. Attorney John E. Kuhn, Jr.
“Arson is a violent crime that causes millions of dollars in property damage and puts the safety of the general public and fire service personnel at great risk. Investigating Arson is a top priority of ATF. Today, a dangerous criminal was removed from this community and imprisoned for several years based on the heroic fire suppression efforts of the Bowling Green Fire Department and the investigative efforts of the Kentucky State Police, the Western Kentucky Arson Task Force and ATF,” said ATF Special Agent in Charge Stuart Lowrey.
This case was prosecuted by Assistant United States Attorneys Joshua Judd and Marisa Ford and was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) and the Western Kentucky Arson Task Force composed of members from the Bowling Green Fire Department and the Kentucky State Police.
Armed Career Criminal Sentenced to 30 Years in Prison for String of RobberiesRead the Press Release
Federal sentence results from “Project Recoil”
LOUISVILLE, Ky. – A career criminal from Georgia was sentenced today to 30 years in prison, followed by five years of supervised release, by Senior District Judge Thomas B. Russell, for multiple robberies, including brandishing a firearm announced Acting United States Attorney John E. Kuhn, Jr. There is no parole in the federal system.
The federal charges stemmed from “Project Recoil,” the on-going partnership of multiple Jefferson County, Kentucky law enforcement agencies, to maximize penalties for the most violent offenders and to reduce violent crime in our community.
Xavier Demetrius Porter, 40, pleaded guilty in U.S. District Court on December 5, 2014, to nine counts of obstructing interstate commerce through robbery, one count of brandishing a firearm during a robbery, and one count of being a felon in possession of a firearm. In 1996, Porter was convicted of three counts of armed robbery, in case number 96-R-398 in Dougherty County (Georgia) Superior Court. During those robberies, he used a sawed-off shotgun.
“Through the cooperation of federal, state and local law enforcement, a violent and dangerous repeat offender will spend the next 30 years behind bars. Project Recoil’s commitment to a team approach is our most effective weapon against crime. Together, we are getting results and making our community a safer place, “stated Acting U.S. Attorney John E. Kuhn, Jr.
“Today’s sentence sends a very strong message that federal, state and local law enforcement agencies are working together to make Louisville a safer community. Anyone contemplating a gun-related crime should realize the possible consequences,” stated Louisville Metro Police Chief Steve Conrad.
“Today, an armed and violent criminal was removed from the Louisville community for a long time. Strong partnerships among federal, state and local law enforcement and with the public we serve are making a positive difference. Gun violence will not be tolerated in Louisville,” said ATF Special Agent in Charge Stuart Lowrey.
Porter admitted to robbing Spinelli’s Pizza located at 2905 Goose Creek Road on March 5, 2013, the Subway located at 3503 South Hurstbourne Parkway on March 7, 2013, the Subway located at 8056 New LaGrange Road on March 17, 2013, Circle K located at 4600 Wattbourne Lane on April 15, 2013, the White Castle located at 3705 Bardstown Road on April 16, 2013, the Thornton’s located at 3909 Taylorsville Road on April 17, 2013, the Subway located on Bishop Lane on April 17, 2013, Cigarette Outlet located on Six Mile Lane on April 18, 2013, and the Adam and Eve store on South Hurstbourne Parkway on April 18, 2013. The federal robbery charges are brought pursuant to the Hobb’s Act, which criminalizes robberies that affect interstate commerce. During eight of the robberies, Porter brandished a firearm. During the first two robberies, he used a small black handgun. During the last five robberies, he used a pistol-grip 12 gauge shotgun. At the time of his arrest, Porter was clutching the money he stole from Adam & Eve in his hand.
Assistant United States Attorney Jo E. Lawless prosecuted the case. The Louisville Metro Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) conducted the investigation.
Hillview, Kentucky Police Chief Convicted of Making A False Statement to Federal AgentsRead the Press Release
LOUISVILLE, Ky. – Hillview, Kentucky Police Chief Glenn A. Caple was convicted today of making a false statement to federal agents when questioned about his knowledge and involvement in moving evidence found on an elected official’s property on January 4, 2012, announced Acting United States Attorney John E. Kuhn, Jr.
“We thank the jurors for their consideration of the evidence in reaching a unanimous guilty verdict,” stated Acting U.S. Attorney John Kuhn. “We must have faith and trust in our police that they will follow the letter of the law – and will be honest with other law enforcement agents investigating crimes. We cannot have our police knowingly and willfully lying to federal agents out of expedience or self-interest. Chief Caple knew better; he broke the law and an important public trust.”
During the four-day trial, the United States proved that Caple lied to federal agents on April 26, 2012, when he was questioned by the Federal Bureau of Investigation (FBI) about his involvement in directing subordinate Hillview Police officers to move evidence, a backpack characterized as a mobile meth lab, from its original location on the residence of the Hillview mayor and/or initially stating to federal agents that the suspected backpack was not found by Hillview police on the mayor’s property.
Hillview, Kentucky is a city of approximately 9,400 residents located in Bullitt County, Kentucky near Jefferson County. Hillview police officers testified under oath that a mobile meth lab in a black backpack was found in a tire next to a garage on the mayor’s property. They further testified that Chief Caple asked a Hillview police officer to move the backpack to a location believed to be off of the mayor’s property and failed to report the incident, in order to protect the mayor from bad publicity.
Jurors deliberated just over one hour before reaching a guilty verdict. Sentencing is scheduled before Senior District Judge Charles R. Simpson III on May 18, 2015, in Louisville. Caple faces no more than five years in prison, a fine of $250,000 and a three year period of supervised release.
This case is being prosecuted by Assistant United States Attorneys Thomas Dyke and Marisa Ford and was investigated by the Louisville field office of the FBI.
Todd County, Kentucky, Man Sentenced to 20 Years in Prison for Coercing Minors to Engage in Sexually Explicit Conduct and Receiving Child PornographyRead the Press Release
BOWLING GREEN, Ky. – A Todd County, Kentucky man was sentenced today in U.S. District Court by Judge Greg Stivers to 20 years in prison, to be followed by a 20-year term of supervised release, for persuading, inducing and coercing two minor females to engage in sexually explicit conduct and for receiving child pornography, announced Acting U.S. Attorney John E. Kuhn, Jr.
“The predatory conduct of Williams was despicable,” stated Acting U.S. Attorney John Kuhn. “The coercion of these girls for his own gratification was not a harmless, inconsequential act to these victims. That he put the child of one of his friends through this is almost unimaginable. This case is a sad but powerful reminder that every parent everywhere must be vigilant against sexual predation, especially in the virtual world. This lengthy sentence is well deserved.”
“This type of crime is especially egregious since he coerced several underage girls, by producing and trading sexually explicit images of them on the internet,” said Howard S. Marshall, Special Agent in Charge, FBI, Louisville Field Division. “These predators exploit the innocence of our children and this sentence should send a message that these acts will not be tolerated.”
Jesse Sanford Williams, age 34, pleaded guilty to all charges of the federal indictment on October 20, 2014. Williams was arrested on March 7, 2014, by federal agents in Kentucky, following an investigation that began in the state of Washington on March 28, 2013. In court, Williams admitted to blackmailing, by threat, at least two minor, teen girls, in order to receive sexually explicit images of them, by means of multiple Gmail and Yahoo internet accounts. Only two of the victims could be identified by authorities. After receiving initial images from the girls, Williams demanded additional sexually explicit images or videos and coerced the girls by threatening to post the initial images on the internet or send them to the girls’ parents. These activities took place between June 2011 and March 2013.
Victim-1 lived in Washington, and was 13 years of age at the onset of the Internet threats. Victim-1 appeared in court today and testified during sentencing. At one point during the time Williams coerced Victim-1, she attempted suicide.
Victim-2 lived in Todd County, and was approximately the same age as Victim-1. According to testimony offered in court today, Williams had very long and close personal relationships with the family of Victim-2, and was known by Victim-2 as “Uncle Jesse.” In his internet communications with both victims, Williams concealed his age and identity from the victims, pretending to be a much younger boy.
During the investigation, a subpoena of email accounts determined all email accounts shared the same Internet Protocol (IP) address from an account located at Logan Aluminum, a large manufacturing facility located near Russellville, Kentucky. The FBI was able to identify Williams from shift schedules, IP login times and other materials obtained in the investigation. Further, Williams admitted to knowingly receiving child pornography between June 2011 and March 2013.
This case is being prosecuted by Assistant United States Attorney Marisa Ford and is being investigated by the Federal Bureau of Investigation (FBI) Louisville and Seattle Divisions and police in Washington State.
Louisville Physician Pays $515,408.85 for Treating Patients with Misbranded Drugs and Fraudulently Charging MedicareRead the Press Release
LOUISVILLE, Ky. – A Louisville physician pleaded guilty this week in U.S. District Court to a criminal charge of treating patients with misbranded medications and was sentenced to a term of one year probation and ordered to pay restitution in the amount of $176,915.55 by U.S. Magistrate Judge Colin H. Lindsay, announced Acting United States Attorney John E. Kuhn, Jr.
Dr. Mark Heinicke pleaded guilty Tuesday, January 27, 2015, to a criminal information. Dr. Heinicke admitted to purchasing Rituxan, Actemra, Remicaid, Aclasta, Prolia, and Synvisc, among others, from foreign drug distributors based in the United Kingdom, from December 1, 2010, through April 19, 2012. The drugs originated outside the United States and were never approved by the U.S. Food and Drug Administration (FDA) for introduction into the United States. These are infusion and injectable medications used to treat cancer, rheumatoid arthritis, osteoarthritis and osteoporosis. The misbranded drugs were administered under Dr. Heinicke’s supervision.
This case is being prosecuted by Assistant United States Attorney Lettricea Jefferson-Webb and was investigated by the Office of Criminal Investigation for the U.S. FDA.
Further, in a separate civil agreement, Dr. Heinicke agreed to pay $338,493.30 in addition to the court ordered restitution to settle certain claims brought against him by the United States on behalf of the Office of Inspector General of the Department of Health and Human Services (OIG-HHS).
According to the civil settlement agreement, between December 1, 2010, and April 19, 2012, Dr. Heinicke purchased foreign, non-FDA approved products (Rituxan, Actemra, Remicaid, Aclasta, Prolia, and Synvisc) at a cost significantly less than FDA-approved versions. Dr. Heinicke used these foreign, non-FDA approved products on Medicare recipients and did not inform those recipients that they were receiving non-FDA approved products. Dr. Heinicke thereafter submitted or caused to be submitted false claims to Medicare, seeking payment for the products as if they were FDA-approved versions and seeking payment for the administration of these products, in violation of the False Claims Act. Medicare made payments to Dr. Heinicke based upon these claims.
The civil case was handled by Assistant United States Attorney Benjamin Schecter, with assistance from the Office of Criminal Investigations for the FDA.
The claims settled by this civil agreement are allegations only; there has been no determination of liability.
Kentuckiana Physician Charged with Prescribing Pain Medications That Resulted in the Deaths of Five PatientsRead the Press Release
Additional Charges Include Health Care Fraud and Unlawful Distribution or Dispensing of Controlled Substances
LOUISVILLE, Ky. – A Kentuckiana physician was charged today by a federal grand jury with prescribing pain medications that resulted in the deaths of five patients, health care fraud, and unlawful distribution or dispensing of controlled substances announce Acting United States Attorney John E. Kuhn, Jr.
Jaime Guerrero, age 47, a medical physician with offices in Louisville, Kentucky, and Jeffersonville, Indiana, was charged in a 32 count indictment today with unlawfully dispensing pain medications to 30 patients, without a legitimate medical purpose and beyond the bounds of professional medical practice. Beginning in December, 2009, and continuing through May 2014, Guerrero allegedly prescribed pain medications that resulted in the deaths of five patients.
The indictment charges Guerrero with dispensing Oxycodone, a schedule II controlled substance, to K.J., between June 6, 2011, through August 25, 2011, without a legitimate medical purpose and beyond the bounds of professional medical practice, which resulted in K.J.’s death on or about August 29, 2011. That Guerrero intentionally distributed and dispensed, Methadone, a schedule II controlled substance, to D.N., between December 15, 2009, through April 1, 2010, without a legitimate medical purpose and beyond the bounds of professional medical practice, which resulted in D.N.’s death on or about April 5, 2011. That Guerrero knowingly and intentionally distributed and dispensed, Oxycodone, to R.S., between December 10, 2009, through February 9, 2010, without a legitimate medical purpose and beyond the bounds of professional medical practice, which resulted in R.S.’s death on or about February 18, 2010. That Guerrero dispensed Oxycodone, to P.F. December 28, 2009, and continuing through February 20, 2012, without a legitimate medical purpose and beyond the bounds of professional medical practice, which resulted in P.F.’s death on or about March 3, 2012. That Guerrero knowingly and intentionally distributed and dispensed, Hydrocodone, a schedule III controlled substance, to S.O., between January 6, 2010, and continuing through September 16, 2011, without a legitimate medical purpose and beyond the bounds of professional medical practice, which resulted in S.O.’s death on or about September 24, 2011.
Guerrero is further charged with two counts of health care fraud for allegedly fraudulently billing various health care benefit programs and for submitting fraudulent claims for patient health care counseling. Specifically, on May 26, 2011, June 15, 2011, and June 22, 2011, Guerrero allegedly saw more than 100 patients on each of the dates, by himself, and spent approximately 3 minutes or less with each patient, and fraudulently billed various health care benefit programs, for office visits at a higher code than the service provided. And for directing a staff member, who was not a licensed counselor, to provide drug education classes to patients, and falsely and fraudulently, bill various health care benefit programs, by submitting claims for 15-30 minute counseling sessions while the defendant was out of the office.
If convicted at trial, Guerrero faces up to life in prison, a $2,750,000 fine and a three year period of supervised release.
This case is being prosecuted by Assistant United States Attorneys Joseph Ansari and Lettricea Jefferson-Webb and is being investigated by the Federal Bureau of Investigation (FBI), the U.S. Department of Health and Human Services-Office of Inspector General (HHS-OIG), the U.S. Drug Enforcement Administration (DEA), Indiana and Kentucky Medicaid Fraud Control Units, the Kentucky State Police (KSP) and Louisville Metro Police Department (LMPD).
***
The indictment of a person by a Grand Jury is an accusation only and that person is presumed innocent until and unless proven guilty.
Brandenburg, Kentucky, Man Charged with Threatening to Blow up A Church and Apartment ComplexRead the Press Release
OWENSBORO, Ky. - A Meade County, Kentucky man was charged in a two-count indictment with threatening, by way of a telephone, to damage and destroy with explosives, a church located in Brandenburg, Kentucky, and with threatening, by way of telephone, to damage and destroy with explosives, an apartment building located in Brandenburg, announced Acting United States Attorney John E. Kuhn, Jr.
Shelly L. Wright, age,45 was charged on January6, 2015, and the indictment was unsealed today following his arrest by Agents of the Federal Bureau of Investigation, Brandenburg Police Department and Kentucky State Police.
According to the indictment, on November 16, 2014, Wright, through the use of a telephone, willfully made a threat to unlawfully damage and destroy the Glad Tidings Church, located on Bypass Road in Brandenburg, by means of explosives. Further, it is alleged that on or November 26, 2014, Wright, through the use of a telephone, willfully made a threat to unlawfully damage and destroy the Riverview Apartments.
If convicted at trial, Wright would face no more than ten years in prison, a fine of $250,000 and a three year period of supervised release. Wright is scheduled to appear before Magistrate Judge Colin Lindsay, in Louisville, tomorrow morning at 10am, for arraignment and a detention hearing.
This case is being prosecuted by Assistant United States Attorney Randy Ream and is being investigated by the Federal Bureau of Investigation (FBI) and the Meade County Sheriff’s Department.
***
The indictment of a person by a Grand Jury is an accusation only and that person is presumed
innocent until and unless proven guilty.
Fort Campbell, Kentucky, Resident Charged with Felony Murder Resulting from Child AbuseRead the Press Release
PADUCAH, Ky. – A Fort Campbell, Kentucky, woman remains in federal custody today charged with felony murder related to the death of an infant, announced Acting U.S. Attorney John E. Kuhn, Jr.
Sheilla E. Linares, was indicted by a federal grand jury on December 18, 2014. Linares was specifically charged with unlawfully killing an infant, T.R.C., Jr., committed in the perpetration of child abuse.
The incident occurred December 3, 2013, in the Linares home on the Fort Campbell military base. Linares was providing child care for T.R.C., Jr., who died four days later on December 7, 2013.
The Federal Bureau of Investigation arrested Linares on Friday, December 19, 2014, and her arraignment was held the same day before United States Magistrate Judge Lanny King. A detention hearing was held today before Judge King and was continued without a decision on bond. Until further order of the court, Linares will remain in the custody of the United States Marshals Service.
If convicted at trial, Linares faces a sentence of life in prison and a $250,000 fine.
This case is being prosecuted by Assistant United States Attorney Jo E. Lawless and is being investigated by the Federal Bureau of Investigation with assistance from the United States Army Criminal Investigation Division, and the Clarksville Tennessee Police Department.
***
The indictment of a person by a Grand Jury is an accusation only and that person is presumed innocent until and unless proven guilty.
Jefferson County, Kentucky, Man Sentenced to 37 Years and 10 Months in Prison and Ordered to Pay Restitution for Multiple RobberiesRead the Press Release
LOUISVILLE, Ky. – A Louisville man was sentenced on December 16, 2014, by Senior U.S. District Judge John G, Heyburn II, to serve 37 years and 10 months in prison for the robbery of a bank and a neighborhood business located in Jefferson County, Kentucky, and ordered to pay restitution in the amount of $120, 714.62 announced John E. Kuhn, Jr., Acting United States Attorney for the Western District of Kentucky. There is no parole in the federal correctional system.
John R. Hatton, age 31, was found guilty by a federal jury in Louisville, on November 20, 2013, of robbing the East Pointe Branch of Your Community Bank on September 23, 2011, and of robbing the M & I Smoke Shop, located on Preston Highway, in Louisville, Kentucky on October 26, 2011. Evidence at trial established that Mr. Hatton and an accomplice, Jillian Wojciechowski, entered the Your Community Bank branch wearing masks and armed with pistols. Once inside, Mr. Hatton and Ms. Wojciechowski held the bank employees at gunpoint and took $120, 714.62 in cash from the bank. At the time of the robbery, the bank’s deposits were insured by the Federal Deposit Insurance Corporation (FDIC).
During the robbery of the M & I Smoke Shop, Mr. Hatton entered the business alone and demanded cash from the store owner at gunpoint. After Mr. Hatton had taken a small amount of cash, the store owner took Mr. Hatton’s pistol away from him and shot Mr. Hatton as Mr. Hatton was trying to escape from the store.
This case was prosecuted by Assistant United States Attorneys Thomas W. Dyke and Stephanie Zimdahl, and was investigated by Louisville Metro Police Department Robbery Unit.