District of Maryland
Press releases recorded for this federal judicial district.
Upper Marlboro, Maryland Couple Sentenced to Prison for Harboring A Filipino Woman in Their Home for More Than 10 YearsRead the Press Release
Ordered to Pay the Victim Restitution of $369,580.80
Greenbelt, Maryland - Chief U.S. District Judge Deborah K. Chasanow sentenced Gloria Edwards, age 61, to a year and a day in prison, followed by three years of supervised release, and sentenced her husband, Alfred, age 74, to three months in prison, followed by seven months of home detention as part of two years of supervised release, for harboring a Filipino national whom they brought to the United States under false pretenses. As a condition of their supervised release, the defendants are prohibited from contacting or harassing the victim in any way. Chief Judge Chasanow also ordered the Edwards’, both of Upper Marlboro, Md, to pay restitution of $369,580.80 to the victim. The sentence was imposed late on May 7, 2013, and the amount of restitution was announced today.
The sentences were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Deputy Assistant Attorney General for the Department of Justice Civil Rights Division Roy L. Austin, Jr.; and Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation.
“Alfred and Gloria Edwards compelled the victim to work for them for a decade for little or no salary,” said U.S. Attorney Rod J. Rosenstein. “They were able to maintain control over the victim by bringing her into the United States under false pretenses, holding her passport and arranging for a sham marriage.”
According to their plea agreements and testimony presented at their sentencing, in October 1998, the couple arranged for the victim to enter the United States from the Philippines under false pretenses. Gloria Edwards paid $5,000 to cover the costs of the woman’s entry into the United States, including payment to another individual to secure the woman’s visa under false pretenses. The Edwards’ knew that the woman entered the United States without disclosing the true purpose of her visit, or that she would be residing at the Edwards’ residence. The woman arrived in the U.S. in May 1999. Gloria Edwards drove the woman to the Edwards’ home in Upper Marlboro, where the woman primarily resided until she left the residence in August 2009.
The woman provided low cost labor to the Edwards as a domestic servant and provided care for Gloria Edwards’ mother. According to testimony at the sentencing hearing, the Edwards’ took the woman’s passport and made the woman sign a contract stating that she would have to pay the Edwards’ $20,000 if she were to leave their service, so that they could replace her.
The Edwards’ admitted that during the more than 10 years that the woman was in the United States, they took steps to fraudulently obtain permanent resident status for the woman, including arranging a sham marriage.
Prior to sentencing the Edwards’ paid $6,716.20 to satisfy the disputed amount relating to allegations that they misappropriated funds.
United States Attorney Rod J. Rosenstein praised the Baltimore Division of the FBI for its work in the investigation. Mr. Rosenstein and Mr. Austin thanked Assistant U.S. Attorney Kristi N. O’Malley and Trial Attorney Cindy Chung of the Civil Rights Division’s Human Trafficking Prosecution Unit, who prosecuted the case.
New York Pimp Convicted in Maryland for Sex Trafficking and Gun CrimesRead the Press Release
Victims Were Sexually and Physically Assaulted, and Forced to Work as Prostitutes,
in Maryland, New York and ElsewhereBaltimore, Maryland - A federal jury today convicted Jeremy Naughton, a/k/a “Jerms Black,” age 32, of Brooklyn, New York, on charges related to sex trafficking, including transporting individuals to engage in prostitution, and using a gun during the conspiracy to commit sex trafficking.
The jury verdict was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; and Chief J. Thomas Manger of the Montgomery County Police Department.
“Jeremy Naughton held young women against their will, and used violence, sexual abuse and threats to compel them to work for him as prostitutes,” said U.S. Attorney Rod J. Rosenstein.
According to evidence presented at the 14-day trial, from January 2009 to the fall of 2010, Naughton and his long-time friend, Charles Anderson, targeted female prostitutes between the ages of 19 and 28 who were working without a pimp, to force and coerce the women to work for them. They contacted women who posted ads on websites for prostitution services and arranged to meet them in hotel rooms, masquerading as a prospective client. Naughton and Anderson then assaulted and threatened the victims with a handgun and/or physical violence to force them to work for them. They stole the women’s cell phones, identification, room keys and personal computers to prevent them from communicating with others, and controlled the victims through physical assault, humiliation, confinement and threats. Naughton transported the women between Maryland, New York and other states to engage in prostitution.
For example, in the summer of 2009, Naughton enticed a woman to come to an apartment in Brooklyn, where he imprisoned her and invited others to sexually abuse her. In September of 2009, Naughton forced open the door of a woman’s hotel room, stole her cell phone and identification, and detained her while demanding that she work for him as a prostitute. In October 2009 in his apartment, Naughton displayed a handgun, struck a woman, choked her and forced her to perform sex. Between October 25 and November 11, 2009, Naughton drove two women from his apartment to Oxon Hill where he demanded that they rent hotel rooms for commercial sex. In December of 2009, Naughton violently assaulted a woman in a hotel in Montgomery County, Maryland. On February 8, 2010, Naughton forced a woman from her hotel room in Silver Spring, Maryland, forced her to stay with him at the Brooklyn apartment and sexually abused her before attempting to prostitute her from a hotel in Long Island, New York. In June 2010, Naughton intimidated another woman by snapping the neck of her dog with his hands. In September of 2010, Naughton entered another victim’s hotel room, demanded that she work for him, stole her cell phone and money, and transported her to his apartment, where he forced her to perform oral sex.
Naughton shared his apartment in Brooklyn with Anderson. According to Anderson’s plea agreement, the victims stayed in the Naughton’s room, where Anderson sometimes overheard Naughton physically assaulting them and forcing them to perform sex acts. In the spring of 2010, Anderson agreed to monitor the victims while Naughton traveled for approximately six hours in search of an additional prostitute in Maryland. Anderson helped Naughton locate victims who had escaped. He also knew that Naughton had a .9mm pistol and a larger sub-machine gun in the apartment, along with corresponding ammunition.
Naughton faces a maximum sentence of life in prison for conspiring to commit sex trafficking; a minimum of 15 years and a maximum of life in prison for each of four counts of sex trafficking; a maximum of 10 years in prison on each of six counts of transporting an individual to engage in prostitution; seven years in prison, consecutive to any other sentence, for possession of a firearm in furtherance of a crime of violence. U.S. District Judge J. Frederick Motz has scheduled sentencing for August 15, 2013 at 9:30 a.m.
Charles Anderson, a/k/a “Chuck Corners,” a/k/a “Yowzer,” age 26, of Brooklyn, New York, previously pleaded guilty to conspiracy to commit sex trafficking and is scheduled to be sentenced on June 14, 2013 at 2:15 p.m.
The case was investigated by the Maryland Child Exploitation Task Force, with assistance from the Maryland Human Trafficking Task Force, which was formed in 2007 to discover and rescue victims of human trafficking while identifying and prosecuting offenders. Members of both task forces include federal, state and local law enforcement. The Maryland Human Trafficking Task Force also includes victim service providers and local community members. For more information about the Maryland Human Trafficking Task Force, please visit www.justice.gov/usao/md/Human-Trafficking/index.html.
United States Attorney Rod J. Rosenstein commended the FBI’s Baltimore, New York, and Las Vegas, Nevada offices and the Montgomery County Police Department for their work in the investigation and thanked the Montgomery County State’s Attorney’s Office, the Kings County (Brooklyn, NY) District Attorney’s Office, the Department of Homeland Security and the New York City Police Department for their assistance. Mr. Rosenstein thanked Assistant U.S. Attorneys Mark W. Crooks and Paul E. Budlow, who are prosecuting the case.
Former Firefighter Pleads Guilty to Production and Possession of Child PornographyRead the Press Release
Baltimore, Maryland - Anthony Maurice Cottle, age 23, of Owings Mills, Maryland, pleaded guilty today to sexual exploitation of a minor to produced child pornography and to possession of child pornography.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge William Winter of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Commissioner Anthony W. Batts of the Baltimore Police Department; Chief James W. Johnson of the Baltimore County Police Department; and Baltimore County State’s Attorney Scott Shellenberger.
According to his plea agreement, in June and July 2012, Cottle, a former firefighter with the Baltimore County Fire Department, engaged in sexually explicit conduct with two minor males in order to produce visual depictions of the abuse, including two videos. Cottle produced one video that depicts the genitalia of a minor male and Cottle performing sex acts on the boy. Cottle produced a second video depicting the genitalia of another minor male. More than 600 images of child pornography were recovered from Cottle’s computer and cell phone.
In addition to the videos produced by Cottle, images of several other child victims, whom Cottle solicited to send him photos of their genitals, were found. Cottle admitted that on some occasions he used video chat to capture the image live, and on other occasions the minor would send a photograph via cellular phone.
As part of his plea agreement, Cottle must register as a sex offender in the place where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA).
Cottle faces a minimum mandatory sentence of 15 years in prison and a maximum of 30 years in prison followed by up to lifetime of supervised release for production of child pornography; and a maximum of 10 years in prison for possession of child pornography. U.S. District Judge Ellen L. Hollander has scheduled sentencing for July 18, 2013, at 2:00 p.m.
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 "resources" tab on the left of the page.
This investigation was part of Operation Predator, a nationwide HSI initiative to protect children from sexual predators, including those who travel overseas for sex with minors, Internet child pornographers, criminal alien sex offenders and child sex traffickers. HSI encourages the public to report suspected child predators and any suspicious activity through its toll-free hotline at 1-866-DHS-2ICE or by completing its online tip form. Both are staffed around the clock by investigators.
United States Attorney Rod J. Rosenstein commended HSI Baltimore, the FBI, Baltimore County Police Department, Baltimore Police Department and Baltimore County State’s Attorney’s Office for their work in the investigation and prosecution. U.S. Attorney Rosenstein also recognized the Baltimore County Fire Department for its assistance in this case. Mr. Rosenstein thanked Assistant U.S. Attorney Ayn B. Ducao, who is prosecuting the case.
21 Alleged Bloods Gang Members and Associates Indicted for Federal Criminal Conspiracies Based in Howard CountyRead the Press Release
Baltimore, Maryland – A federal grand jury has indicted 18 alleged members of the Howard County Bloods gang on federal racketeering charges and charged three other defendants and two of the alleged Bloods gang members, with conspiracy to distribute drugs.
The indictment and a search warrant affidavit were unsealed today upon the arrests of 15 defendants and the execution of 25 search warrants. Five defendants were already in custody. Approximately 200 agents and officers assisted in today’s arrests and search warrants. The indictment was returned on May 7, 2013.
The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Steven L. Gerido of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; Howard County Police Chief William McMahon; Baltimore Police Commissioner Anthony W. Batts; and Howard County State’s Attorney Dario Broccolino.
“I am confident that ATF’s successful execution of more than 40 federal arrest and search warrants made a significant impact on violent crime in our Maryland communities,” said Special Agent in Charge Steven L. Gerido of the ATF - Baltimore Field Division. “ATF continues to work with its federal, state, and local law enforcement partners in order to bring violent criminals to justice.”
Howard County State’s Attorney Dario Broccolino stated, “Today’s indictments show this office, along with the Howard County Police Department, will use every tool at our disposal to continue to make Howard County safe. We are appreciative of the cooperation and leadership of our federal partners in this effort.”
“The indictment unsealed today shows that no community is immune to gang and drug activity, but it also demonstrates our commitment to ridding our neighborhoods of this criminal element,” said Howard County Police Chief William J. McMahon. “That’s why I have made our participation in this task force a priority and I am grateful to all our partners. Gang members who commit crimes should know that they will not be tolerated in Howard County or throughout Maryland.”
The indictment alleges that 18 of the defendants were members or associates of the Bloods, a national criminal street gang with members operating in and around Howard County, Maryland. The Bloods are divided into “sets,” each identified or affiliated with a certain street, neighborhood or area. Court documents allege that the defendants include members of more than one Blood “set.” Bloods are identified by: the color red, worn by Bloods members; a rivalry with the Crips gang; and particular gang symbols, including distinctive tattoos, such as a dog paw or five-pointed star and hand signs.
The indictment charges that from 2010 to the present, the Howard County Bloods gang members conspired to engage in criminal activity. The Bloods committed acts of violence both within the gang, to maintain discipline, and against rival gangs. Participation in criminal activity by a member, particularly violent acts directed at rival gangs or as directed by the gang leadership, increased the respect accorded to that member, resulted in that member maintaining or increasing his position in the gang, and could result in a promotion to a leadership position.
The indictment alleges that the defendants and other members and associates of the Bloods maintained and shared firearms for use in criminal activity by fellow gang members. The defendants and other Bloods members and associates allegedly distributed drugs, including marijuana and oxycodone (Percocet), codeine, and MDMA (Ecstasy), and used the proceeds of those drug transactions to help finance the gang’s illegal activities. The affidavit filed in support of search warrants executed today reveals telephone calls intercepted during the investigation in which the defendants discuss assaults, robberies, burglaries, home invasions, and drug trafficking that the defendants and other members allegedly committed in order to generate proceeds, and to obtain drugs to support the gang. Finally, the indictment alleges, and intercepted telephone calls indicate, that the Bloods provided financial support, such as reloadable debit cards, to incarcerated gang members.
The following defendants are charged in the racketeering conspiracy:
- Ryan Gladden, a/k/a "Fats," age 25, of Baltimore;
- Anthony Preston, a/k/a "40," and "Tone," age 26, of Randallstown, Maryland;
- Giovanni Wright, a/k/a "G," age 20, of Elkridge, Maryland;
- Heather Carter, a/k/a "hunnilynn," age 29, of Columbia, Maryland
- Kyle Austin, a/k/a "Fowdy," age 21, of Baltimore;
- James Bieryla, a/k/a "Brea," and "Braze," age 21, of Ellicott City, Maryland;
- Russell Canty, a/k/a "Rek," age 20, of Baltimore;
- Van Albert Carroll, Jr., a/k/a "Kool-Aid," age 19, of Ellicott City;
- Russell Chesson, a/k/a "Black," age 30, of Washington, D.C.;
- Corey Conaway, a/k/a "KC," age 30, of Columbia;
- Adrian Freeman, a/k/a "Sleep," age 23, of Laurel, Maryland;
- Kevin Jarrell, a/k/a "K-Dog," 24, of College Park, Maryland;
- Michael Dominique Johnson, a/k/a "Ace", age 19, of Columbia;
- Faisal Lelo Mapangala, a/k/a "Pistol," age 21, of Jessup, Maryland;
- Christopher Lloyd McGann, age 21, of Columbia;
- Kenneth Ragan-Armstrong, a/k/a "Keezy," age 22, of Savage, Maryland;
- David Jerome Robertson; age 22, of Columbia; and
- Bamba Omar Saine, age 22, of Columbia.
Three other defendants are charged in narcotics conspiracies:
- Wendy Farhat, age 38, of Gaithersburg, Maryland;
- Anthony Louis Jones, age 26, of Columbia; and
- Troy Fowler, age 23, of Laurel.
The indictment alleges that beginning in January 2013, Farhat, alleged Bloods member Anthony Preston, and Jones conspired to distribute marijuana, oxycodone, and Ecstasy. Jones is still being sought.
In a separate conspiracy, the indictment alleges that beginning in 2013, alleged Bloods member Giovanni Wright conspired with Troy Fowler to distribute marijuana, codeine and Ecstasy.
Each of the 18 defendants charged in the racketeering conspiracy faces a maximum sentence of 20 years in prison; and each of the five defendants charged in narcotics conspiracies faces a maximum sentence of 20 years in prison.
Initial appearances for many of the defendants are taking place today in federal court in Baltimore.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
United States Attorney Rosenstein commended the 200 federal, state and local law enforcement officers led by the ATF, who worked together to execute the search and arrest warrants today.
Mr. Rosenstein commended the ATF, Howard County Police Department, Baltimore Police Department and Howard County State’s Attorney’s Office for their work in this investigation and prosecution. Mr. Rosenstein thanked Assistant U.S. Attorneys Rachel M. Yasser and Sandra Wilkinson, who are prosecuting the case.
Two Members of A Pickpocket Crew Plead Guilty ToRead the Press Release
Baltimore, Maryland – Crystal Barner, age 28, and Maureen Brown Little, age 39, both of Baltimore, pleaded guilty today to a scheme in which the conspirators stole wallets from women’s purses, removed the cash, credit cards and driver’s licenses and used the credit cards to make purchases at nearby stores.
The guilty pleas were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Acting Special Agent in Charge Lisa Quinn of the United States Secret Service – Baltimore Field Office; Colonel Michael Kundrat, Chief of the Maryland Transportation Authority Police; Chief James W. Johnson of the Baltimore County Police Department; and Commissioner Anthony W. Batts of the Baltimore Police Department.
According to their plea agreements, beginning in May 2007, the women were part of a scheme to defraud financial institutions by stealing credit cards from the wallets and purses of unsuspecting individuals, then using the stolen credit cards to make purchases. Specifically, the leader of the group, who was experienced at pickpocketing wallets, would wait in women’s restrooms and steal the wallets of women who hung their purses on the hooks in the stalls. Often, one of the other co-conspirators would create a distraction in an adjacent stall, such as asking for toilet paper, so that the victim would be looking away from her purse. Barner sometimes served as a “lookout” for the leader. Often the leader was able to remove cash and credit cards and return the wallet to the victim’s purse without the victim seeing or suspecting the theft.
Barner and Little, who each participated in the scheme until her arrest in 2012, received stolen credit cards from the leader. The conspirators took the cards to nearby retail stores and used each card until it began to be declined. The conspirators purchased items for their personal use, as well as gift cards or high end merchandise that the leader of the scheme would direct them to buy and would then resell. Barner and Little engaged in the scheme on a regular basis, knew that the credit cards were stolen and knew that other members of the conspiracy were conducting fraudulent transactions as well.
During the course of the conspiracy, Barner and Little obtained goods, services and extensions of credit of between $30,000 and $70,000, and caused losses to or used the identities of between 10 and 50 financial institutions, businesses and individuals.
The defendants each face a maximum sentence of 30 years in prison for bank fraud conspiracy and a mandatory sentence of two years in prison, consecutive to any other sentence imposed, for aggravated identity theft. U.S. District Judge Marvin J. Garbis has scheduled sentencing for Barner on August 2, 2013 and for Little on July 26, 2013.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
United States Attorney Rod J. Rosenstein thanked the U.S. Secret Service, Maryland Transportation Authority Police, Baltimore County Police Department and Baltimore City Police Department for their work in the investigation. Mr. Rosenstein praised Assistant U.S. Attorney Tamera L. Fine, who is prosecuting the case.
Former Maryland National Guard Employee at Aberdeen Proving Ground Sentenced to Prison for Fraud Scheme with Losses of over $107,000Read the Press Release
Baltimore, Maryland - U.S. District Judge Richard D. Bennett sentenced Lynn Carol Williams, age 56, of Middle River, Maryland today to six months in prison, followed by six months of home detention with electronic monitoring as part of three years of supervised release, for wire fraud in connection with a scheme to misuse the Freestate Challenge Academy corporate purchasing card, causing losses of more than $107,000. Freestate Challenge Academy is a Maryland National Guard program located at Aberdeen Proving Ground. Judge Bennett also ordered Williams to pay restitution of $107,493.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Special Agent in Charge Robert Craig of the Defense Criminal Investigative Service - Mid-Atlantic Field Office and Chief Chip Honan of the Aberdeen Proving Ground Police Department.
According to her plea agreement, from October 2007, through February 2011, Williams worked as an administrative aide at Freestate Challenge Academy, located at Aberdeen Proving Ground. Williams was authorized to use the Academy’s corporate credit card to make purchases for the Academy, and was required to prepare a monthly expense report, which included the purchasing card billing statement, original receipts, copies of the approved requisition forms, and a log of activity on the purchasing card. Once her supervisor approved the expense report, it was forwarded to the State of Maryland Military Department, which paid the account balance on the corporate purchasing card.Williams admitted that from February 2008, through October 2010, she used the corporate credit card to buy gift cards and to purchase items over the internet for her personal use. For example, on May 18, 2010, Williams used the corporate credit card to purchase six gift cards, which she then used to pay for two airline tickets for her and a friend to travel to Los Angeles, California. To conceal her fraud, Williams prepared false logs of the card activity and used her work computer to prepare fictitious receipts, to give the impression she was using the card to make legitimate purchases on behalf of the program, such as for office supplies, snacks for program participants and other legitimate items.
United States Attorney Rod J. Rosenstein praised the FBI, Defense Criminal Investigative Service and Aberdeen Proving Ground Police for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Joyce K. McDonald, who prosecuted the case.Armed Career Criminal Exiled to 15 Years in PrisonRead the Press Release
Baltimore, Maryland - U.S. District Judge Ellen L. Hollander sentenced Samuel Sterling, age 35, of Baltimore, Maryland, today to 15 years in prison followed by three years of supervised release for being a felon in possession of a gun. Judge Hollander enhanced Sterling’s sentence upon finding that he is an armed career criminal based on three previous convictions for a drug offense and violent crime.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Steven L. Gerido of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; Baltimore City State’s Attorney Gregg L. Bernstein; and Baltimore Police Commissioner Anthony W. Batts.
According to his plea agreement, on April 9, 2012 Baltimore police detectives saw Sterling and an individual standing on a corner near the intersection of LaFayette and Port Streets in Baltimore, conducting what appeared to be a hand-to-hand drug transaction. When the detectives approached, Sterling ran away, throwing a gun to the ground. A short time later Sterling was taken into custody. A .32 caliber semi-automatic pistol and orange topped vials containing cocaine were subsequently seized. Sterling had previously been convicted of a felony and was prohibited from possessing a gun.
United States Attorney Rod J. Rosenstein commended the ATF, Baltimore Police Department and Baltimore City State’s Attorney's Office for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorney Clinton J. Fuchs, who prosecuted the case.
Six Veterans Plead Guilty to Fraudulently Obtaining over $500,000 in Veterans BenefitsRead the Press Release
Baltimore, Maryland - Kenneth Williams, age 64, of Baltimore, and Raymond Sadler, age 61, of Middle River, Maryland, both U.S. Marine Corps veterans, pleaded guilty today to fraudulently obtaining veterans benefits. Veterans Sandra Tyree, age 64, of Rosedale, Maryland; Kenneth Webster, age 67, of Pasadena, Maryland; Paul Heard, age 64, of Baltimore; and John Bratcher, age 54, of Conowingo, Maryland pleaded guilty on Monday, April 29, 2013, to the same charge.
The guilty pleas were announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Kim R. Lampkins of the Department of Veterans Affairs Office of Inspector General.
“Like all government agencies that award benefits based upon a sworn certification that the claimant deserves them, the Veterans Administration is vulnerable to abuse by dishonest people,”said U.S. Attorney Rod J. Rosenstein. “The defendants cheated the government of hundreds of thousands of dollars by falsely representing that they were suffering from medical disabilities as a result of their military service.”
U.S. Army veteran David Clark, age 68, of Hydes, Maryland, the former Deputy Chief of Veterans Claims in the Maryland Department of Veterans Affairs, has been indicted in connection with the scheme to fraudulently obtain over $1.4 million in veterans benefits. As the Deputy Chief for Veterans Claims, Clark’s duties included submitting claims and documentation on behalf of veterans in Maryland who appointed the MDVA to represent them in obtaining federal benefits from the Department of Veterans Affairs (VA). The indictment alleges that Clark fraudulently obtained VA compensation for himself, and others, in exchange for cash. According to the indictment, Clark claimed that he, co-defendants, and others, had been exposed to Agent Orange during the Vietnam War and had subsequently developed diabetes. In support of these claims, the indictment alleges that Clark submitted fraudulent documentation, including fake letters from physicians purportedly treating the veterans, which made statements that entitled each claimant to a retroactive lump-sum payment and increased the amount of compensation the VA paid the claimant. The indictment alleges that Clark created counterfeit versions of Defense Department Form 215 (DD215) for himself, several co-defendants and others, which falsely stated that they had served in combat in Vietnam. These documents were submitted to the VA to provide false evidence that they qualified for compensation benefits for diabetes.
Clark is also charged with submitting certifications to the Maryland State Department of Assessments and Taxation stating that some of his veteran co-schemers were entitled to a property tax waiver from the State of Maryland due to a100 percent service-connected disability.
Williams admitted that in 2006, he agreed to pay Clark to submit a false claim to the VA on Williams’ behalf for diabetes purportedly arising from military service during the Vietnam War. Williams received a one-time lump disability payment from the VA in 2006 of $6,000, from which he paid Clark $3,000. Thereafter, Williams received monthly payments from the VA until October 2012, for a total of $42,567 in benefits that he was not entitled to receive.
According to their guilty pleas: from 2003 to October 2012, Tyree, a U.S. Air Force veteran and a former employee of the U.S. Department of Veterans Affairs, received a total of $56,304 in benefits, and Webster, a U.S. Marine Corps veteran and former AMTRAK police officer, fraudulently received a total of $181,476 in benefits; from 2004 to October 2012, Sadler fraudulently received a total of $82,201 in benefits; and from 2006 to 2012, Heard, a U.S. Navy veteran, received a total of $58,060 in benefits to which he was not entitled. Neither Tyree nor Webster ever served in Vietnam, but they admitted that Clark submitted false service records to make it appear as if they had. Additionally, Heard admitted that he obtained a property tax waiver by having Clark submit false certification related to Heard’s purported disability. Heard fraudulently received tax waivers totaling $15,677 between 2006 and 2012.
Finally, according to his plea agreement, Bratcher, served in the U.S. Air Force from 1975 to 1980, stationed in Germany and the United States. Bratcher admitted that Clark submitted documents to the VA on Bratcher’s behalf falsely claiming compensation for diabetes, including a letter purported to be from his doctor. Bratcher had never seen this doctor and never served in Vietnam. Bratcher paid Clark between $3,000 to $5,000 to fraudulently obtain a total of $70,912 in VA benefits from 2003 to October 2012.
The total loss involving these six defendants, including the loss from the property tax evasion, is $507,197. The defendants will be required to forfeit all of these proceeds of the scheme.
The defendants each face a maximum sentence of 20 years in prison for wire fraud and a $250,000 fine. U.S. District Judge Catherine C. Blake scheduled sentencing for Williams and Sadler on August 2, 2013. Judge Blake set the sentencing for Bratcher, Heard and Tyree on July 12, 2013, and for Webster on August 26, 2013.
The indictment alleges that the VA benefit fraud loss as a result of the scheme is $1,151,219 and the loss from the property tax evasion is $255,555, for a total loss of $1,407,134.
An indictment is not a finding of guilt. David Clark is presumed innocent unless and until proven guilty at some later criminal proceedings.
Today's announcement is part of efforts underway by President Obama=s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorney’s offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
United States Attorney Rod J. Rosenstein praised the VA Office of Inspector General for its work in the investigation and thanked Assistant U.S. Attorney Leo J. Wise, who is prosecuting the case.
Two Former Special Agents with Department of Commerce Office of Inspector General Plead Guilty to Submitting False Claims for Relocation Expenses and Time and Attendance FraudRead the Press Release
Greenbelt, Maryland - Two former Special Agents with the U.S. Department of Commerce, Office of Inspector General, Rachel Ondrik, age 35, of Frederick, Maryland, and Kirk Yamatani, age 38, of Ashburn, Virginia, pleaded guilty today to submitting false claims for relocation expenses. Ondrik and Yamatani resigned their positions with the Department of Commerce on March 29, 2013, as required by their plea agreements.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; and Todd Zinser, Inspector General for the U.S. Department of Commerce (DOC).
“Today’s announcement is the result of significant efforts by the U.S. Attorney’s Office, the FBI and my office to hold law enforcement agents accountable for years of criminal misconduct,” said Inspector General Todd Zinser of the U.S. Department of Commerce. “In addition to the fraud perpetrated on the U.S. taxpayers, these now former employees also retaliated by carrying out a destructive campaign of disparagement and false allegations against the Office of Inspector General (OIG).” Mr. Zinser added, “I commend the U.S. Attorney’s Office and the FBI for their diligent efforts and perseverance in conducting this investigation.”
According to their plea agreements, in 2009, Ondrik and Yamatani, transferred from the DOC OIG’s Atlanta, Georgia office to Washington, D.C. Ondrik and Yamatani were authorized relocation benefits, including a househunting trip, en route travel, and temporary quarters living expenses. Emails between Ondrik and Yamatani show that both agents were aware of the rules governing their relocations and reimbursements for related expenses, yet both attempted to secure payment from the DOC in amounts significantly exceeding what was authorized and submitted claims for relocation related trips they did not take.
For example, Ondrik and Yamatani claimed $4,058.75 and $3,589, respectively for househunting trips, when in fact, they did not make a househunting trip during the time claimed. Ondrik and Yamatini each also falsely claimed more than $1,500 for travel to their new duty station and falsely claimed reimbursement for temporary quarters living expenses in an amount that was approximately three times what they were authorized. In all, Ondrik and Yamatani each submitted at least three false vouchers seeking reimbursement for $39,563.25 and $36,305.57, respectively. When Ondrik and Yamatani’s claims for reimbursement were denied as being over what the travel regulations allowed, Ondrik and Yamatani persisted in their claims. On several occasions between 2009 and 2011, Ondrik and Yamatani reaffirmed the earlier false statements in their vouchers and made false statements regarding the circumstances of their claims for reimbursement.
Between June 2009 and February 2011, Ondrik and Yamatani also committed time and attendance fraud against DOC OIG, claiming to have worked hours that they did not actually work. The loss to the government attributable to each defendant’s conduct was approximately $14,000.
The defendants and the government have agreed that if the Court accepts the plea agreement Ondrik and Yamatani will each be sentenced to a term of probation and ordered to pay a fine of $28,000. In addition, each defendant will be required to pay $14,000 in restitution to the government. U.S. Magistrate Judge Charles B. Day has scheduled sentencing for June 19, 2013 at 2:30 p.m.
United States Attorney Rod J. Rosenstein praised the FBI and DOC OIG for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Adam K. Ake and Robert K. Hur, who are prosecuting the case.
Landover Woman Indicted for Allegedly Embezzling over $453,000 from Her EmployerRead the Press Release
Greenbelt, Maryland - A federal grand jury today indicted Mercy Coffie-Joseph, a/k/a Mercy A. Coffie, age 40, of Landover, Maryland, on charges of wire fraud and money laundering in connection with a scheme to embezzle over $453,000 from her employer. She was also charged with making a false statement in a passport application, using a passport obtained through a false statement and aggravated identity theft.
The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; and Special Agent in Charge Niall Meehan of the Washington Field Office of the U.S. Department of State’s Diplomatic Security Service.
According to the 10 count indictment, from May 2010 through February 15, 2013, Joseph was employed by Systems Assessment & Research, Inc. (SAR), where she had the authority to make electronic payments to contractors on SAR’s behalf. The indictment alleges that during the time of her employment, Joseph allegedly stole $453,125.52 from her employer by initiating funds transfers from SAR bank accounts to bank accounts she owned and/or controlled. The indictment alleges that Joseph laundered the money, using the stolen funds to draw two cashier’s checks for $40,000 and $50,000, respectively, to purchase a house in Ghana.
The indictment also alleges that Joseph used the name and date of birth of another individual, without the person’s knowledge or permission, to apply for and receive a United States passport, which Joseph then used to travel to Ghana.
The indictment seeks forfeiture of the proceeds of the wire fraud, including $453,125.52 in cash, as well as property discovered at Joseph’s home during the execution of a search warrant on April 15, 2013, including a video camera worth approximately $10,000, a Gucci handbag purchased for approximately $885, diamond earrings and necklace, a Movado watch, and computers.
Joseph faces a maximum sentence of 20 years in prison for each count of wire fraud and money laundering; a maximum of 10 years in prison for making a false statement on a passport application; and a mandatory two years in prison, consecutive to any other sentence imposed, for aggravated identity theft.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
United States Attorney Rod J. Rosenstein thanked the FBI and U.S. Department of State’s Diplomatic Security Service for their work in the investigation. Mr. Rosenstein praised Assistant U.S. Attorneys Thomas P. Windom and Robert K. Hur, who are prosecuting the case.
In Recognition of the 13th Annual World Intellectual Property Day Maryland U.S. Attorney’s Office Highlights Recent CasesRead the Press Release
Baltimore, Maryland - The growing role of the internet has dramatically enhanced the opportunities for criminals around the world to sell products that do not belong to them, depriving the legitimate owners of any profit. April 26th is the 13th Annual World Intellectual Property Day, designated to increase public awareness about the role of intellectual property rights in promoting innovation and creativity. Intellectual property theft – whether involving counterfeit medicines, network hardware, pirated content or trade secrets – threatens our nation’s economy, can endanger public health and safety, and can even undermine our national security.
The Maryland U.S. Attorney’s Office works with U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and other federal, state and local partners to enforce intellectual property rights. Some of the highlights from the past year involving Maryland cases are:
Trafficking in Counterfeit Goods
In January 2013, Liang Lin, pleaded guilty to trafficking in counterfeit goods. Lin owned and operated two shops on the boardwalk in Ocean City, Maryland, where he sold counterfeit merchandise, including purses, handbags, shirts, jewelry perfume, hats, and shoes that bore trademarks such as Michael Kors, Nike, Monster, Coach, Gucci, Versace, Vera Wang, Louis Vuitton and Channel. Law enforcement made several seizures of counterfeit trademarked merchandise from Lin and his stores. The retail value of the counterfeit trademarked merchandise seized from and sold by Lin is between $200,000 and $400,000. The estimated retail value of the counterfeit merchandise, based on what Lin was selling the infringing counterfeit items for, is $153,585. Lin is scheduled for sentencing on July 10, 2013 at 9:30 a.m.
Jerold Lee Sharoff has been indicted for conspiring to, and trafficking in counterfeit goods, and counterfeit labels. Sharoff operated Beachwear Outlet and Surf Beachwear, both on Atlantic Avenue in Ocean City, where the indictment alleges that he sold counterfeit trademarked merchandise. Sharoff also allegedly stored counterfeit goods at a warehouse located in Ocean City. Further, the indictment alleges that Sharoff and his co-conspirators manufactured counterfeit t-shirts by applying heat transfers bearing counterfeit trademarks to t-shirts using heat presses. Sharoff is scheduled to go to trial on October 21, 2013.
Several other defendants have pleaded guilty to trafficking in trademarked counterfeit goods, such as Nike, Coach, Gucci, Versace, Louis Vuitton, Chanel, Michael Kors, Jimmy Choo, Tory Burch, Juicy, Prada, Christian Dior, Ed Hardy, Burberry, and Dolce & Gabbana, with losses estimated at between $10,000 and $30,000. Keith Jackson pleaded guilty to selling counterfeit purses, handbags and watches. He was arrested three times for selling counterfeit goods before being charged federally. He is scheduled to be sentenced on June 12, 2013 at 1:00 p.m. Co-defendants Philip Swaby and Yoncra Robinson pleaded guilty to operating a store in Baltimore called Fashion Trendz, where they sold counterfeit purses, watches, jewelry, glasses, wallets and scarves. They are scheduled to be sentenced on June 5, 2013 at 3:00 p.m. Tidiane Ba was sentenced to eight months in prison and ordered to pay $1,000 in restitution, and Baba Toure was sentenced to one year probation, after they pleaded guilty to selling counterfeit purses, handbags, shoes, watches, hats and other items by luxury manufacturers at locations around Baltimore, including at the Patapsco Flea Market. They rented storage units to store counterfeit trademarked merchandise received from suppliers in New York. HSI agents seized counterfeit goods from the defendants on several occasions during the course of the investigation. Charges against three co-defendants are pending.
Copyright Infringement
Naveed Sheikh, age 32, of Baltimore, pleaded guilty to conspiring to and infringing copyrights by illegally reproducing and distributing over 1000 copyrighted commercial software programs, with a value of over $4 million. Sheikh created multiple websites through which the infringing software was sold. Sheikh did not report the income from the copyright infringement scheme on his tax returns. As part of his plea agreement, Sheikh will be required to forfeit $4 million. Sentencing is scheduled for May 15, 2013 at 3:00 p.m.
Website Seizures
In 2012, the U.S. Attorney’s Office, working with HSI-led National Intellectual Property Rights Coordination Center (IPR Center) and HSI Baltimore special agents, seized and shut down websites selling counterfeit items.
For example, in October 2012, nearly 700 U.S. based websites selling trademarked counterfeit pharmaceutical drugs were seized and shut down. The drugs being offered for sale on the websites included anti-cancer medications, drugs to treat depression and dementia, drugs to reduce the risk of heart attack and stroke, weight loss and food supplements, and erectile dysfunction pills. Analyses of trademarked counterfeit pharmaceutical drugs purchased from the websites revealed that the drugs were generally shipped from outside the U.S, and were not authentic, nor approved by the Food and Drug Administration for sale in the U.S. The operation, known as Bitter Pill, was part of an international initiative that spanned 100 countries and confiscated over 3 million doses of counterfeit medications worth approximately $10.5 million.
In June 2012, two domain names and three PayPal accounts were seized in connection with a scheme to sell fraudulent store and rewards coupons. The Sderclub.com and its related domain name, ccccpn.com, offered online sales of store and rewards coupons, also known as “rewards checks” from Staples, Inc. Website operators created compromised and fraudulent coupons using coupon codes legitimately issued by Staples for use by Staples Rewards customers. The fraudulent coupons purchased from sderclub.com or ccccpn.com expired within a couple of days in order to be used by the purchaser before the legitimate Staples customer, to whom the coupon was issued, redeemed it. From January 13, 2009 through May 15, 2012, over 102,553 transactions pertaining to the sale of fraudulent store and/or rewards coupons occurred on the three seized PayPal accounts, each of which was created by an individual residing in China.
These cases are part of the efforts being undertaken by the Department of Justice Task Force on Intellectual Property (IP Task Force). Attorney General Eric Holder created the IP Task Force to combat the growing number of domestic and international intellectual property crimes, protect the health and safety of American consumers, and safeguard the nation’s economic security against those who seek to profit illegally from American creativity, innovation and hard work. The IP Task Force seeks to strengthen intellectual property rights protection through heightened criminal and civil enforcement, greater coordination among federal, state and local law enforcement partners, and increased focus on international enforcement efforts, including reinforcing relationships with key foreign partners and U.S. industry leaders. To learn more about the IP Task Force, go to http://www.justice.gov/dag/iptaskforce/.
HSI manages the IPR Center in Washington, one of the U.S. government's key weapons in the fight against criminal counterfeiting and piracy. As a task force, the IPR Center uses the expertise of its 20 member agencies to share information, develop initiatives, coordinate enforcement actions and conduct investigations related to IP theft. Through this strategic interagency partnership, the IPR Center protects the public's health and safety, the U.S. economy and the war fighters. To report IP theft or to learn more about the HSI-led IPR Center, visit www.IPRCenter.gov.
Baltimore Man Exiled to over 12 Years for Armed RobberiesRead the Press Release
Baltimore, Maryland - U.S. District Judge Catherine C. Blake sentenced Branch Sparrow, age 31, of Baltimore, Maryland, today to 150 months in prison followed by five years of supervised release for armed robbery.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Steven L. Gerido of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; Baltimore City State’s Attorney Gregg L. Bernstein; and Baltimore Police Commissioner Anthony W. Batts.
According to Sparrow's plea agreement, on August 26, 2011, Sparrow and co-defendant Allen Benny robbed a bar in the 3600 block of Fleet Street in Baltimore. Sparrow was armed with a 7.62 caliber pistol. Upon entering the bar, Sparrow brandished the gun at employees and customers of the bar, threatening them with violence, while Benny stole approximately $800 from the cash register. The two fled the bar, but were seen a short while later by police officers responding to the robbery. As the officers approached, they saw Sparrow discard a gun in a nearby trash can. Officers recovered the gun and arrested Sparrow and Benny. The officers recovered $800 from Benny’s pants pocket.
Sparrow admitted that on August 25th, he also committed an armed robbery of a convenience store in the 4800 block of O’Donnell Street in Baltimore, brandishing a gun at the store employee and stealing an unknown amount of cash from the store’s cash register. Sparrow also attempted to rob a store in the 5800 block of Pulaski Highway on August 13th, again brandishing a gun at a store employee and demanding money from the cash register. Rather than open the register, the store employee fled and Sparrow left the store.
Benny, age 47, also of Baltimore, previously pleaded guilty and was sentenced to four years in prison.
United States Attorney Rod J. Rosenstein commended the ATF, Baltimore Police Department and Baltimore City State’s Attorney's Office for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys Clinton J. Fuchs and Kenneth S. Clark, who prosecuted the case.
Bureau of Prisons Employee Admits Receiving Unlawful GratuitiesRead the Press Release
Baltimore, Maryland - A day after her trial began in federal court, Susan A. Pratt, age 47, of Crofton, Maryland, pleaded guilty on April 23, 2013 to receipt of unauthorized payments as a government employee.
The plea agreement was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge M. Elise Chawaga, Fraud Detection Office, U.S. Department of Justice Office of the Inspector General.
Pratt was a supervisory traffic management specialist in the Bureau of Prisons (BOP) Relocation Services section, located in Annapolis Junction, Maryland. Relocation Services is responsible for paying the relocation expenses of BOP employees when they are reassigned to another duty station. Pratt was responsible for providing relocating BOP employees with a list of approved movers. After the employee selected the carrier, Pratt referred the move to agents of the carrier. Pratt later signed the government bills of lading, which became the agreement between BOP and the carrier/agent for the move.
According to her plea agreement, from 2007 to 2008, Pratt caused moves for employees who chose Mayflower as their carrier to be sent to a Mayflower agent – Klavuhn Moving & Storage. In January 2006 and December 2007, the sales representative for Klavuhn Moving & Storage provided two gift cards to Pratt for a salon and spa, in the amounts of $1,007 and $790, and Pratt accepted and used the gift cards, which were significantly more than the $50 in gifts that government employees are allowed to receive annually from individuals with whom they do business. Her receiving the gift cards also served to supplement her government salary and inappropriately compensated her for her work as an employee of the BOP.
Pratt also received free moving services from two moving companies in December 2007 and May 2010.
Pratt faces a maximum sentence of one year in prison and a $100,000 fine. U.S. District Judge Ellen L. Hollander scheduled sentencing for June 25, 2013 at 3:00 p.m.
United States Attorney Rod J. Rosenstein praised the U.S. Department of Justice Office of Inspector General for its work in the investigation and thanked Assistant United States Attorneys Joyce K. McDonald and Special Assistant U.S. Attorneys Sean Marlaire and Matthew W. Lunder, assigned from the Antitrust Division of the U.S. Department of Justice, who are prosecuting the case.
Leaders in Broadway Document Mill Sentenced to PrisonRead the Press Release
Nine Defendants Operated a Document Mill in the 200 Block of South Broadway in Baltimore and Sold Thousands of Fraudulent Government Identification DocumentsBaltimore, Maryland - U.S. District Judge William D. Quarles, Jr. sentenced Roberto Morales-Perez, a/k/a “Piza,” age 27, of Baltimore to 6 years in prison, followed by three years of supervised release for conspiring to a operate a document mill in the 200 block of South Broadway in Baltimore (the “Broadway Territory”), and selling fraudulent government identification documents manufactured as part of the conspiracy.
On April 23, 2013, Judge Quarles sentenced the brother of Morales-Perez, Ivan Altamirano-Perez, a/k/a “Elmer,” age 33, also of Baltimore, to 97 months in prison, followed by three years of supervised for conspiracy to commit fraud, fraud and misuse of immigration documents, social security fraud, and identification document fraud, in the same scheme.
Moralez-Perez and Altamirano-Perez are Mexican nationals in the country illegally and face deportation upon the completion of their sentences.
The sentences were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge William Winter of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); and Special Agent in Charge Michael McGill of the Social Security Administration - Office of Inspector General, Philadelphia Field Division.
“Document fraud poses a severe threat to national security and puts the security of our communities at risk because it creates a vulnerability that may enable terrorists, criminals and illegal aliens to gain entry to and remain in the United States,” said HSI Baltimore Special Agent in Charge William Winter. “This investigation resulted in the dismantlement of a document fraud criminal organization based out of Maryland and the arrest of its leaders. Homeland Security Investigations will move aggressively to investigate and bring to justice those who potentially compromise the integrity of America's legal immigration system.”
According to their plea agreements and other court documents, responsibility for manufacturing identity documents – including permanent resident cards and social security cards - rotated among various individuals. From June 2008 through May 2010, Morales-Perez and Altamirano-Perez received the income from manufacturing the identity documents. Beginning in May 2010 and continuing until their arrests, the Perez brothers shared the territory and income with Miguel Reyes-Ontiveros (collectively, the Operators). The location of the manufacturing operation changed frequently to avoid detection.
In addition to manufacturing the documents, the Operators sold the documents themselves or through salesmen. The defendants used a group of at least 10 individuals to sell and distribute the fake identity documents. The documents were offered for sale and distributed in and around the 200 block of South Broadway in Baltimore.
According to their plea agreements, the salesmen solicited individuals in the Broadway territory to purchase the fake identification documents, either in person or by distributing business cards. The salesman would negotiate a price with the buyer, usually between $130 and $160, and obtain a picture and the information which the buyer wanted on the identification card. The salesman would then call in the order to the Operator who was working that week. The completed identity document would subsequently be provided to the salesman to be sold to the buyer.The defendants manufactured and sold 9,990 fraudulent identification documents for which they received approximately $1.68 million.
All nine defendants have pleaded guilty in this case. Miguel Reyes-Ontiveros, age 42, of Baltimore, one of the document mill operators, was previously sentenced to 57 months in prison. All of the defendants are in the U.S. illegally and face deportation upon the completion of their sentences.
A defendant in a related case, Victor Lopez Escamilla, was convicted by a jury of manufacturing and trafficking in counterfeit identity document, social security number cards, and immigration identity documents and was sentenced to 97 months in prison.
Anyone who has information on this type of fraud may contact ICE via its toll-free hotline at 1-866-DHS-2ICE (1-866-347-2423) or by visiting www.ice.gov/tips.
United States Attorney Rod J. Rosenstein praised HSI Baltimore and the Social Security Administration - Office of Inspector General for their work in the investigation, and thanked the U.S. State Department Diplomatic Security Service - Washington Field Office; the Maryland Motor Vehicle Administration - Investigation and Security Services Division; and the Baltimore County Police Department for their assistance. Mr. Rosenstein thanked Assistant United States Attorneys Tamera L. Fine and Judson T. Mihok, who prosecuted the case.
Frederick Sex Offender Sentenced to 10 Years in Prison for Possessing Child PornographyRead the Press Release
Baltimore, Maryland –U.S. District Judge William D. Quarles Jr. sentenced Emil Moldovan, age 40, of Frederick, Maryland, today to 10 years in prison followed by lifetime supervised release for possessing child pornography. Judge Quarles also ordered that upon his release from prison, Moldovan must register as a sex offender in the place where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA).
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge William Winter of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); and Colonel Marcus L. Brown, Superintendent of the Maryland State Police.
According to his plea agreement, on June 28, 2011 an undercover internet investigation identified an image of child pornography being downloaded from a computer at Moldovan’s address. A search warrant was executed at Moldovan’s residence and law enforcement seized computers and storage media containing over 600 videos and images of child pornography. The depictions included images of children under 12 engaged in sexual conduct, including sadistic conduct and other depictions of violence.
Moldovan stated that he had been downloading child pornography and since his internet service was too expensive, he had cancelled it and was connecting to the internet via an open wireless connection he located in his neighborhood.
Moldovan had previously been convicted in January 2007 in Frederick County Circuit Court of distributing and promoting child pornography.
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 "resources" tab on the left of the page.
This investigation was part of Operation Predator, a nationwide HSI initiative to protect children from sexual predators, including those who travel overseas for sex with minors, Internet child pornographers, criminal alien sex offenders and child sex traffickers. HSI encourages the public to report suspected child predators and any suspicious activity through its toll-free hotline at 1-866-DHS-2ICE or by completing its online tip form. Both are staffed around the clock by investigators.
United States Attorney Rod J. Rosenstein commended HSI Baltimore and the Maryland State Police for their work in the investigation. Mr. Rosenstein thanked Special Assistant U.S. Attorney Judson T. Mihok, who prosecuted the case.
Baltimore Man Exiled to over 11 Years in Prison on Drug ChargesRead the Press Release
Baltimore, Maryland - U.S. District Judge James K. Bredar sentenced Tracey Betters, age 21, of Baltimore, Maryland, today to 135 months in prison followed by five years of supervised release for conspiracy to possess with the intent to distribute five kilograms or more of cocaine.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Steven L. Gerido of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; Baltimore City State’s Attorney Gregg L. Bernstein; Commissioner Anthony W. Batts of the Baltimore Police Department; and Maryland Attorney General Douglas F. Gansler.
According to their plea agreements, in May 2012, Tracey Betters, his brother Blake Betters, and Brandon Harris, were introduced to an undercover Bureau of Alcohol, Tobacco and Firearms (ATF) agent who proposed robbing a large scale drug trafficker of multiple kilograms of narcotics. The Betters brothers and Harris agreed to commit the robbery and to resell the stolen narcotics to customers in the Baltimore area.
On June 14, 2012, Tracey and Blake Betters, Harris and three co-conspirators met with the undercover agent to make their final preparations to commit the robbery. Tracey and Blake Betters, Harris and their co-conspirators were armed, and they all expected the weapons to be used to commit the robbery. After confirming that they were ready to rob the stash house, the Betters’, Harris and their co-conspirators followed the agent to a location in Baltimore where they believed they would be given the location of the robbery. En route to the final meeting location, Tracey Betters and his co-conspirators discussed their willingness to kill the stash house guards as well as the undercover agent, who they planned to rob of his share of the stolen cocaine. As the arrest team approached, the Betters and Harris fled, but were quickly apprehended and arrested.
Co-defendants Blake Betters, age 23, and Brandon Harris, age 22, both of Baltimore were each previously sentenced to 10 years in prison for their roles in the conspiracy.
United States Attorney Rod J. Rosenstein commended the ATF, Baltimore Police Department and Baltimore City State’s Attorney’s Office for their work in this investigation. Mr. Rosenstein thanked Assistant United States Attorneys Clinton J. Fuchs and Special Assistant United States Attorney Gerald A. A. Collins, a cross designated Maryland Assistant Attorney General assigned to Exile cases, who prosecuted the case.
13 Correctional Officers among 25 Alleged BGF Gang Members and Associates Indicted on Federal Racketeering ChargesRead the Press Release
Baltimore, Maryland - A federal grand jury returned a racketeering indictment charging 25 individuals, including 13 correctional officers with the Maryland Department of Public Safety and Correctional Services, for conspiring to run operations of the Black Guerilla Family (BGF) gang inside correctional facilities. All 25 defendants also are charged with conspiracy to distribute and possession with intent to distribute drugs; and 20 of the defendants are charged with money laundering conspiracy.
The indictment and a detailed affidavit were unsealed today upon the arrests of the defendants and the execution of 15 search warrants. Approximately 170 agents and officers assisted in today's arrests and search warrants. The indictment was returned on April 2, 2013. One defendant was killed in a robbery several hours before the indictment was filed. The defendants are identified in Attachment A.
The indictment arose from the efforts of the Maryland Prison Task Force, a group of local, state and federal stakeholders that met regularly for more than two years and generated recommendations to reform prison procedures.
The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Baltimore Police Commissioner Anthony W. Batts; Secretary Gary D. Maynard of the Maryland Department of Public Safety and Correctional Services; and Chief Mark A. Magaw of the Prince George's County Police Department.
U.S. Attorney Rosenstein also recognized the efforts of the other members of the Maryland Prison Task Force in this investigation and prosecution, including: Baltimore City State's Attorney Gregg L. Bernstein; Colonel Marcus L. Brown, Superintendent of the Maryland State Police; United States Marshal Johnny Hughes; Special Agent in Charge Karl C. Colder of the Drug Enforcement Administration - Washington Field Division; Tom Carr, Director of the Washington-Baltimore High Intensity Drug Trafficking Area; and Dave Engel, Executive Director of the Maryland Coordination and Analysis Center.
"Correctional officers were in bed with BGF inmates, in violation of the first principle of prison management," said U.S. Attorney Rod J. Rosenstein. "Preventing prison corruption requires intensive screening at prison entrances and punishment for employees who consort with inmates or bring cell phones and drugs into correctional facilities."
"This investigation revealed the pervasive nature of prison corruption in Baltimore City's Detention Centers," said FBI Special Agent in Charge Stephen E. Vogt. "Such corruption causes the FBI to divert crucial investigative resources away from addressing violence on the streets of Baltimore. In this case, the inmates literally took over "the asylum," and the detention centers became safe havens for the BGF. Such a situation cannot be tolerated. Law enforcement should not have to concern itself with criminal subjects who have already been arrested and relegated to detention centers."
"Ninety-nine percent of our Correctional Officers do their jobs with integrity, honesty and respect," said Secretary Gary Maynard of the Maryland Department of Public Safety and Correctional Services. "Today's indictment, along with those in the past, show that our Department will not stand idly by and let a few bad actors affect the security of our institutions. Nor will we allow them to impugn the reputation of the men and women who come to work every day and go about their jobs honorably. Those who would break the law should know we will always work tirelessly with our federal, state and local partners to root out corruption."
"Today's multi-jurisdictional takedown of suspected BGF gang members and orchestrators who infiltrated the criminal justice system is another example of the Baltimore Police Department's relentless focus on targeting the malignant gang organizations that plague our communities," said Police Commissioner Anthony Batts. "Thanks to the hard working detectives, federal agents and prosecutors who worked behind the scenes to build these cases. Our continued pledge to the people of Baltimore is that we will leverage the full capacity of our state and federal partnerships to identify those responsible for violence and bring them to justice."
The 10 men and 15 women charged in the indictment are alleged to be members or associates of the BGF, a gang active in prisons throughout the United States. According to the indictment, BGF has been the dominant gang at the Baltimore City Detention Center (BCDC), and in several connected facilities, especially the Baltimore Central Booking Intake Center, the Women's Detention Center, which houses many men, and in the Jail Industries Building. The indictment alleges that since at least 2009, BGF members and associates in BCDC and related prison facilities engaged in criminal activities, including drug trafficking; robbery; assault; extortion; bribery; witness retaliation; money laundering; and obstruction of justice.
BGF members and associates allegedly bribed correctional officers at BCDC and related prison facilities to smuggle drugs, cell phones and other contraband. Correctional officers arranged favored treatment and privileges for imprisoned BGF gang members, and officers thwarted interdiction and law enforcement efforts against BGF inmates. BGF members and associates allegedly had long-term sexual relationships with several correctional officers and impregnated them.
BGF leaders allegedly used contraband cell phones to order contraband. Co-conspirators delivered contraband to corrupt correctional officers who smuggled the items into the prisons. Correctional officers often arranged payment for the contraband. Some gang dues and drug profits were used to support activities of BGF street organizations outside the prisons.
The charging documents allege that correctional officers were able to bring contraband directly into the prisons through the main entrances. Inside the prisons, BGF was able to control contraband smuggling because BGF gang members were designated as "working men." Working men are inmates who are paid to assist management and are free to move about the facility.
Green Dot cash debit cards were allegedly used by inmates to pay BGF for smuggled contraband and used by BGF to transfer criminal proceeds. Luxury automobiles were among the purchases made by BGF with Green Dot cards.
According to the indictment, members and associates followed directions from the ranking BGF members in BCDC, especially inmate Tavon White. On January, 5, 2013, White explained in a phone call:
"This is my jail. You understand that? I'm dead serious.... I make every final call in this jail, ... and nothing go past me, everything come to me.... Any of my brothers that deal with anybody, it's gonna come to me. You see what I am saying? Everything come to me. Everything. Before a mother-f----- hit a n----- in the mouth, guess what they do, they gotta run it through me. I tell them whether it's a go ahead, and they can do it or whether they hold back. Before a mother-f----- stab somebody, they gotta run it through me.... Anything that get done must go through me."
Tavon White summarized his position in a conversation with correctional officer Adrena Rice on February 11, 2013:
"I told them worker men that they had to step down off the worker men spots or they was getting hit.... I hold the highest seat you can get... My word is law..., so if I told any mother-f------ body they had to do this, hit a police, do this, kill a mother-f-----, do anything, it got to get done. Period."
White allegedly used contraband cell phones to discuss BGF activities inside BCDC, such as the collection of fees and taxes, to request information about inmates, to hear grievances from other BGF inmates, and to coordinate his contraband smuggling operation. White and other gang members developed sexual relationships with officers in order to gain influence over them.
White allegedly had long-term sexual relationships inside BCDC with four correctional officers, Jennifer Owens, Katera Stevenson, Chania Brooks and Tiffany Linder, impregnating each of the four officers at least once. Owens had "Tavon" tattooed on her neck and Stevenson had "Tavon" tattooed on her wrist. All four officers allegedly help smuggle contraband into BCDC and related facilities. White allegedly gave Owens a diamond ring and provided luxury automobiles to Owens, Stevenson and Brooks. The indictment includes many overt acts in furtherance of the racketeering enterprise. For example, in November 2012, correctional officer Jasmin Jones allegedly stood guard outside a closet in BCDC so that correctional officer Kimberly Dennis and inmate Derius Duncan could have sex. Corrupt officers also warned BGF inmates about law enforcement operations. For example, Brooks and Linder allegedly notified White when they learned about upcoming canine scans and jail cell searches. The affidavit specifies two occasions in which warning calls to White were intercepted: December 21, 2012 (from Brooks), and January 6, 2013 (from Linder). White then used his cell phone to spread the word to other inmates.
On January 6, 2013, White allegedly said:
"I just got a message (from Officer Tiffany Linder) saying that they was going to pull a shake down (prison search) tonight. Let me call all these dudes in my phone and let them know."
The U.S. Attorney expressed appreciation to Secretary Maynard and select members of his senior staff who confidentially arranged for 30 trusted correctional officers from outside Baltimore to join with federal agents and conduct surprise searches of BGF members and their jail cells on February 14, 2013, resulting in the discovery of important evidence.
The indictment seeks the forfeiture of $500,000 and other proceeds of the enterprise, including luxury automobiles.
The defendants face a maximum sentence of 20 years in prison on the racketeering and drug conspiracies, as well as for conspiracy to commit money laundering. Stevenson, Yarborough and Pinder each also face five years in prison for possession with intent to distribute marijuana.
The defendants are expected to have initial appearances in U.S. District Court in Baltimore this afternoon.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
United States Attorney Rod J. Rosenstein praised the FBI, Maryland Department of Public Safety and Correctional Services, Baltimore Police Department, the Prince George's County Police Department and Maryland Prison Task Force, Baltimore City Assistant State's Attorneys Kevin Wilson and Katie O'Hara for their work in the investigation. Mr Rosenstein thanked Assistant United States Attorneys Robert R. Harding and Ayn B. Ducao, who are prosecuting this Organized Crime Drug Enforcement Task Force case.
ATTACHMENT A
The following defendants are charged in the indictment unsealed today.
Inmates:
Tavon White, a/k/a Bulldog and Tay, age 36, of Baltimore;
Jamar Anderson, a/k/a Hammer and Hamma Head, age 26, of Baltimore;
Derius Duncan, age 26, of Baltimore;
Steven Loney, a/k/a Stevie, age 24, of Baltimore;
Jermaine McFadden, a/k/a Maine, age 24, of Baltimore;
Kenneth Parham, age 23, of Baltimore; and
Joseph Young, a/k/a Monster, age 30, of Baltimore.Correctional officers:
Antonia Allison, age 27, of Baltimore;
Ebonee Braswell, age 26, of Baltimore;
Chania Brooks, age 27, of Baltimore;
Kimberly Dennis, age 26, of Baltimore;
Jasmin Jones, a/k/a J.J., age 24, of Baltimore;
Taryn Kirkland, age 23, of Baltimore;
Katrina LaPrade, a/k/a Katrina Lyons, age 31, of Baltimore;
Tiffany Linder, age 27, of Baltimore;
Vivian Matthews, age 25, of Essex, Maryland;
Jennifer Owens, a/k/a O and J.O., age 31, of Randallstown;
Adrena Rice, age 25, of Baltimore;
Katera Stevenson, a/k/a KK, age 24, of Baltimore; and
Jasmine Thornton, a/k/a J.T., age 26, of Glen Burnie.Outside suppliers:
Tyesha Mayo, age 29, of Baltimore;
Teshawn Pinder, age 24, of Baltimore;
Tyrone Thompson, a/k/a Henry, age 36, of Baltimore;
Ralph Timmons, Jr., a/k/a Boosa, age 34, of Baltimore (deceased); and
James Yarborough, a/k/a J.Y., age 26, of BaltimoreTwice Convicted Sex Offender Pleads Guilty to Receiving Child Pornography While on Federal Probation for Prior Sex OffenseRead the Press Release
Greenbelt, Maryland – Larry Poole, age 50, of Laurel, Maryland pleaded guilty to receipt of child pornography.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Chief Richard McLaughlin of the Laurel Police Department; and Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation.
According to his plea agreement, on June 11, 2012 the Child Protective Services (CPS) received a report that Poole was sending text messages claiming to be molesting an unidentified nine year old girl. CPS referred the matter to the Laurel Police Department, who were not able to locate any child in Poole’s neighborhood matching the description used by Poole in his texts.
The Laurel police subsequently learned that Poole was on federal probation, and was registered as a sex offender based on two prior convictions: in 2003, of child abuse, in Baltimore County Circuit Court; and in 2006, of attempting to entice a minor to engage in sex, and possession of child pornography, in federal court for the District of Columbia.
Laurel police alerted Poole’s federal probation officer who conducted a surprise visit to Poole’s residence on June 25, 2012. Poole consented to a preview of his cell phone, and the probation officer discovered videos and images of child pornography. Poole admitted that an individual brought child pornography to Poole’s home the previous day on a thumb drive or SD card and helped Poole load pornographic images of girls under 14 years old onto Poole’s computer and cell phone.
Laurel police and the FBI executed a search warrant, seized Poole’s cell phone and computer, and discovered approximately six videos and 120 images of child pornography.
As part of his plea agreement, Poole must register as a sex offender in the place where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA).
Poole and the government have agreed that if the Court accepts the plea agreement Poole will be sentenced to 15 years in prison. Chief U.S. District Judge Deborah K. Chasanow scheduled sentencing for June 24, 2013, at 10:00 a.m.
MCETF partners with the Maryland Human Trafficking Task Force, formed in 2007 to discover and rescue victims of human trafficking while identifying and prosecuting offenders. Members include federal, state and local law enforcement, as well as victim service providers and local community members. For more information about the Maryland Human Trafficking Task Force, please visit www.justice.gov/usao/md/Human-Trafficking/index.html.
United States Attorney Rod J. Rosenstein commended the Laurel Police Department and FBI for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Kristi N. O’Malley, who prosecuted the case.
Ringleader and Brothel Operator Convicted of Sex Trafficking ChargesRead the Press Release
Threatened to Assault Prostitutes and Competitor Pimps, and Made Death Threats to Protect and Maintain Prostitution Businesses in Annapolis and EastonBaltimore, Maryland – A federal jury convicted German de Jesus Ventura, age 35, a citizen of El Salvador and an illegal alien residing in Capitol Heights, Maryland of conspiring to transport and entice females to travel interstate for prostitution; transporting females for prostitution; enticing females to travel interstate for prostitution; sex trafficking by force, fraud and coercion; and possessing a gun in furtherance of sex trafficking. The jury also convicted co-defendant Kevin Garcia Fuertes, a/k/a Kerlin Esquivel-Feuntes, age 25, a citizen of Honduras and an illegal alien residing in Annapolis, Maryland, and Richmond, Virginia, of the conspiracy and sex trafficking charges.
The conviction was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Chief Michael Pristoop of the Annapolis Police Department; Easton Police Department Chief David A. Spencer; and Special Agent in Charge William Winter of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI).
According to evidence presented during the two week trial, since at least March 2008 through November 2010, Ventura and Fuertes ran brothels in Annapolis and Easton, Maryland. Ventura, the ringleader, employed Fuertes to advertise and manage the brothels, and the two men shared the cash proceeds of the prostitution business. The defendants recruited and employed prostitutes, many of whom were aliens present in the U.S. unlawfully. Ventura arranged for vans and other vehicles to transport females within Maryland and across state lines to engage in prostitution. Ventura assaulted and threatened to use violence against one prostitute to coerce her continued participation in prostitution, from which Fuertes financially benefitted.
Ventura and Fuertes also threatened to use violence against competitor pimps. On August 3, 2010, Ventura used a cell phone to send three threatening multi-media messages depicting a semi-automatic pistol, the pistol’s magazine and an angel of death statue to a competitor pimp. On November 3, 2010, Ventura arranged for the assault of a competitor pimp with a pistol grip shotgun. In addition to these threats, Ventura reported criminal activity of the pimps in order to divert the attention of law enforcement and facilitate his own prostitution activities. On March 13, 2010, Ventura falsely reported a kidnaping and rape to the police in order to falsely implicate another pimp with the crimes. Ventura also claimed responsibility for the murder of competitor pimp Ricardo Ramirez Riva on September 13, 2008, in order to intimidate the competition, as well as his own employees and prostitutes.
Ventura also sought to intimidate members of the community who assisted his prostitutes. On September 1, 2009 Ventura called and threatened to kill a family who provided temporary housing to one of his prostitutes after she was arrested. He also poured gasoline on their apartment door and smashed windows from their vehicle.
On July 7, 2010, law enforcement executed a search warrant at the brothel located at 318 E. Dover Street in Easton and arrested Isidro Jimenez-Sanchez and Wibert Herrera-Aranda who were working at the brothel.
Ventura and Fuentes face a maximum sentence of five years in prison for the conspiracy count and a mandatory minimum of 15 years in prison to a maximum of life in prison for the sex trafficking count. In addition, Ventura faces a maximum of life in prison for possessing a gun in furtherance of sex trafficking and 10 years in prison for the transporting individuals to engage in prostitution and enticement counts. U.S. District Judge William D. Quarles, Jr. scheduled sentencing for July 24, 2013 at 1:00 p.m.
Jose Antonio Reyes-Maradiaga, age 30; Isidro Jiminez-Sanchez and Wibert Alejandro Herrera-Aranda, both age 34, of Easton, Maryland, previously pleaded guilty to their participation in the scheme. These defendants advertised Ventura’s brothels, made appointments for the prostitutes and collected money. Reyes also helped to transport the women to the brothel locations, and purchased supplies. Jiminez-Sanchez, a Mexican citizen who entered the United States illegally, was sentenced to a year and day for transporting prostitutes, and upon completion of his sentence, was deported from the U.S. to Mexico. Herrera-Aranda was sentenced to 18 months in prison and Reyes was sentenced to time served. Both were also deported.
This case originated with the Annapolis Police Department and was subsequently investigated by members of the Maryland Human Trafficking Task Force formed in 2007 to discover and rescue victims of human trafficking while identifying and prosecuting offenders. Members include federal, state and local law enforcement, as well as victim service providers and local community members. For more information about the Maryland Human Trafficking Task Force, please visit Human-Trafficking
United States Attorney Rod J. Rosenstein praised the Annapolis and Easton Police Departments and HSI Baltimore for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys P. Michael Cunningham and Rachel M. Yasser, who are prosecuting the case.
Mortgage Broker Pleads Guilty in Two Separate Fraud Schemes Resulting in Losses of over $2 MillionRead the Press Release
Falsified Home Buyers’ Information to Generate Fraudulent Loan Applications
in Order to Collect Commissions, Origination and Broker’s FeesGreenbelt, Maryland - Emeka Udeze, age 38, of Bowie, Maryland, pleaded guilty today to conspiring to commit wire fraud in connection with two separate mortgage fraud schemes which resulted in over $2,013,478 of actual losses to mortgage lenders.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge David Beach of the United States Secret Service – Washington Field Office; Inspector General Jon T. Rymer of the Federal Deposit Insurance Corporation; Special Agent in Charge Joe Clarke of the Housing and Urban Development Office of Inspector General - Office of Investigations; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Special Agent in Charge Gene E. Morrison, Washington Field Office, U.S. Department of Justice Office of the Inspector General; Howard County Police Chief William McMahon; Acting Special Agent in Charge Lisa Quinn of the United States Secret Service – Baltimore Field Office; and Howard County State’s Attorney Dario Broccolino.
According to his plea, Udeze was a licensed mortgage broker who worked at various companies, including Newgate Mortgage, owned by co-defendant Shola Risikat Balogun, and EWA Mortgage. Udeze also registered a Maryland company called E&T Consulting, Inc., which he claimed was established to provide general services, among other things.Udeze admitted that in both schemes, he submitted fraudulent mortgage loan applications for buyers, inflating the buyer’s income and creating bogus employment information in an effort to qualify these individuals for loans that they otherwise were unqualified to secure. In some cases, no mortgage payments were made and the property went swiftly into default. In other cases, the borrowers attempted to make mortgage payments for a period of time until they could no longer make payments.
In the first scheme, from at least 2006 through at least December 2008, Udeze, Balogun and others contacted individuals who wished to purchase homes. The buyers, who typically had moderate to low incomes, provided the conspirators with accurate income and employment information. Udeze and others then submitted fraudulent loan applications on behalf of the buyers, inflated the buyer’s income and created bogus employment information in an effort to secure the loan. Udeze, Balogun, and others profited from these fraudulent transactions by collecting origination fees, commissions, yield spread premiums and broker’s fees from each loan that closed.
In a separate scheme, from May 2009 to January 2010, Udeze, co-defendant Niesha Williams, and others, arranged for individuals to buy and sell real estate so they could improperly obtain money from the transactions. Udeze, Williams and others submitted fraudulent loan applications, created multiple versions of settlement statements to deceive lenders, lien holders, buyers and sellers; and arranged for proceeds from mortgage transactions to be disbursed to shell companies created by Udeze and others in order to disguise that the money was really for their benefit. Co-conspirators also failed to make required disbursements of settlement funds to pre-existing lien holders, funneling the money instead to themselves.
For example, Udeze made arrangements for an individual, C.H., to purchase 4853 Brookstone Terrace, Unit 29, Bowie, Maryland 20720 from an individual with the initials D.H. Udeze also had a personal relationship with C.H., who trusted him. Udeze admitted that he prepared and sent a fraudulent loan application to the lender, which included false statements about C.H.’s employment, income, her bank accounts, and the bank account balances, so that C.H. could obtain a loan of approximately $250,000 and purchase the property for $255,000. Udeze and Williams prepared a false HUD-1 Settlement Statement for C.H. and the lender, which falsely represented that the purchase price of the property was $255,000. Udeze knew that Williams had prepared a second HUD-1 Settlement Statement for D.H., which listed a sales price of $200,000. The difference between the loan amount and the true sales price was $50,000 in extra cash at settlement. A total of $31,000 was sent from the title company’s escrow account to E&T Consulting, Inc., for Udeze’s benefit and Williams received $10,000 from the sale. These payments were not listed on the HUD-1 Settlement Statement.
As part of his plea agreement, Udeze will be required to pay restitution and forfeit $2,013,478, the amount of actual losses suffered by the mortgage lenders as the result of the at least 20 transactions Udeke brokered in furtherance of the fraud schemes.
Udeze faces a maximum penalty of 30 years in prison and a $1 million fine on each of the two counts of conspiracy to commit wire fraud. U.S. District Judge Peter J. Messitte did not set a date for sentencing.
Shola Risikat Balogun, age 46, of Upper Marlboro and Niesha Williams, age 33, of Fort Washington, Maryland, each previously pleaded guilty to their role in the fraud schemes. No sentencing date has been scheduled for them at this time.
The Maryland Mortgage Fraud Task Force was established to unify the agencies that regulate and investigate mortgage fraud and promote the early detection, identification, prevention and prosecution of mortgage fraud schemes. This case, as well as other cases brought by members of the Task Force, demonstrates the commitment of law enforcement agencies to protect consumers from fraud and promote the integrity of the credit markets. Information about mortgage fraud prosecutions is available www.justice.gov/usao/md/Mortgage-Fraud/index.html.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.Frederick Man Exiled to 6 Years in Prison for Carrying A Gun During A Drug Trafficking CrimeRead the Press Release
Baltimore, Maryland - U.S. District Judge Catherine C. Blake sentenced Tavares Bowie, age 35, of Frederick, Maryland, today to six years in prison followed by five years of supervised release for carrying a firearm during a drug trafficking crime. Bowie also pleaded guilty today.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Steven L. Gerido of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; Frederick County State’s Attorney J. Charles Smith; and Frederick Police Chief Thomas J. Ledwell.
According to Bowie's plea agreement, on September 3, 2012, Frederick Police officers received a report of a man with a gun at a bar in the area of 325 Market Street. Officers saw Bowie, who matched the description of the person described in the 911 call, walking on Market Street, carrying a small handgun in his left hand. Officers recovered the gun, a .380 caliber handgun, and during a subsequent search of Bowie recovered a baggie containing 22 individually wrapped pieces of crack cocaine for street distribution from his pants pocket.
United States Attorney Rod J. Rosenstein commended the ATF, Frederick Police Department and Frederick County State’s Attorney=s Office for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorney John F. Purcell, who prosecuted the case.
Catonsville Real Estate Appraiser Sentenced to Prison in Scheme to Obtain over $4 Million in Fraudulent Mortgage LoansRead the Press Release
Conspired to Obtain 16 Fraudulent Loans Resulting in Losses of More Than $2.4 MillionBaltimore, Maryland - U.S. District Judge James K. Bredar sentenced real estate appraiser David C. Christian, age 63, of Catonsville, Maryland today to 15 months in prison, followed by three years of supervised release, for conspiracy to commit wire fraud. Judge Bredar also ordered Christian to pay restitution of $2,440,804.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Inspector General Steve A. Linick of the Federal Housing Finance Agency; and Postal Inspector in Charge Gary R. Barksdale of the U.S. Postal Inspection Service - Washington Division.
According to his guilty plea, Christian appraised a number of properties on behalf of purchasers who were seeking financing through Worthington Mortgage Group, LLC, a mortgage brokerage company controlled by Joshua Goldberg, operating out of an office on Gough Street in Baltimore. Christian admitted that from April 2004 to April 2008, at Goldberg’s request, he prepared at least 16 fraudulent appraisals for $4,001,950 in loans originated at the mortgage company. Christian falsified the appraisals by using fake photos and descriptions of the properties, misrepresenting the condition of the properties, and used inappropriate comparable properties. The total loss for the 16 loans amounted to $2,440,804, including $814,730, to the Federal Home Loan Mortgage Corporation (Freddie Mac), and $757,293 to the Federal National Mortgage Association (Fannie Mae). Fannie Mae and Freddie Mac are government sponsored federally chartered corporations that either buy mortgages on the secondary market for their own accounts or arrange to pool the mortgages and sell them as mortgage backed securities to investors on the open market.In March and June 2007, Christian used Goldberg as the mortgage broker to refinance property that he and his wife owned in Catonsville. Christian submitted false appraisals that inflated the property value and caused another appraiser to sign the documents to avoid the obvious conflict of performing an appraisal on his own property. With Christian’s knowledge, Goldberg processed the loan in Christian’s wife’s name, falsifying her income and employment, as well as the balance in the couple’s bank account and misrepresented other information. The loans were funded by another mortgage company, and Christian and his wife eventually defaulted on the loan, resulting in a loss of nearly $140,000.
Joshua S. Goldberg was indicted on related charges earlier this year. He is believed to be a fugitive.
The Maryland Mortgage Fraud Task Force was established to unify the agencies that regulate and investigate mortgage fraud and promote the early detection, identification, prevention and prosecution of mortgage fraud schemes. This case, as well as other cases brought by members of the Task Force, demonstrates the commitment of law enforcement agencies to protect consumers from fraud and promote the integrity of the credit markets. Information about mortgage fraud prosecutions is available www.justice.gov/usao/md/Mortgage-Fraud/index.html.
This law enforcement action is part of President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.United States Attorney Rod J. Rosenstein commended the FBI, Federal Housing Finance Agency - Office of Inspector General, and U.S. Postal Inspection Service. Mr. Rosenstein thanked Assistant U.S. Attorney Gregory R. Bockin, who prosecuted the case.
President of Frederick Mail Preparation Service Pleads Guilty to Fraud Resulting in Losses of over $628,500Read the Press Release
Majority of Victims Were Non-Profit Clients Who Relied on the Mailings to Raise Funds
Baltimore, Maryland – Chester William Bigelow, age 58, of Woodbine, Maryland, pleaded guilty today to conspiracy to commit mail and wire fraud relating to the failure to provide contracted-for services to clients of Bigelow’s company, RMS Direct, Inc., resulting in losses of over $628,500.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Postal Inspector in Charge Gary R. Barksdale of the U.S. Postal Inspection Service - Washington Division.
According to his plea agreement, Bigelow was the president and owned 65% of the shares of RMS Direct, Inc., a mail preparation service located in Frederick, Maryland, with over 200 clients and revenues of over $5 million per year. Under the supervision of Bigelow and RMS vice president Stephen Reid, RMS entered into contracts to prepare and submit to the U.S. Postal Service (USPS), large-volume mailings, typically made up of pamphlets, brochures, books, and other printed materials.
RMS clients were primarily non-profit corporations that relied upon the mailings sent through RMS to raise funds, and the timing of the mailings was essential to their fundraising efforts. RMS assembled the mailings, applied the postage and addresses, and organized the pieces of mail for submission to the USPS. RMS submitted the mailings to a full-time USPS Acceptance Clerk that was assigned to its office. As proof that the mailings went out, RMS then emailed its clients either of two USPS documents – a postage statement signed and certified by the USPS Acceptance Clerk or a Mailing Transaction Receipt printed from an online USPS database. Both documents included information as to the dates, times, number of pieces of mail and postage paid. Once the RMS client received a statement, it would remit payment to RMS.
Bigelow admitted that the conspiracy began in 2005, when he and Reid, who owned 35% of the shares of RMS, falsified postage statements to misrepresent to RMS clients that mailings were being sent out in a timely fashion when, in fact, the mailings were late. Beginning in 2009, Bigelow and Reid selected certain mailings or portions of mailings that would not be submitted at all to USPS for delivery. Bigelow and Reid made sure that the documentation sent to the RMS client was falsified to indicate that the full mailing had been submitted, thereby causing the client to overpay RMS for postage and services.
To accomplish the fraud, Bigelow, Reid, and RMS employees operating at their direction, generated false postage statements, forged the signature of the USPS Acceptance Clerk and created a false impression of the special USPS date stamp used on the postage statement. Bigelow attempted to recreate the special USPS date stamp by hand, but was unsuccessful. Then, in 2006, RMS employees gained unauthorized access to the USPS Acceptance Clerk’s key to the filing cabinet where the date stamp was stored. Bigelow instructed an RMS employee to make a copy of the key, which Bigelow kept in his desk drawer. From that time until 2010, Bigelow, Reid, and RMS employees operating at their direction used Bigelow’s copy of the key to gain access to the date stamp when the USPS Acceptance Clerk was not present in order to falsify postage statements. Beginning in 2010, when the computer-generated Mailing Transaction Receipt was adopted by the USPS to certify mailings, Bigelow and Reid falsified those as well, using a document that had been created, which, when printed, looked identical to the USPS Mailing Transaction Receipt. Bigelow and Reid directed RMS employees to use this document to create false Mailing Transaction Receipts, which were sent to RMS clients as proof of the timely and complete submission of their mailings.
Bigelow and Reid took other measures to conceal the fraud and prolong the victimization of RMS clients. For example, RMS clients often included pieces of mail known as “seeds,” in the mailings they provided to RMS. These “seeds” were sent to particular individuals or addresses so that the client could track the timing and appearance of the mailing. Bigelow directed RMS employees to make sure to deliver the “seeds” from the mailings that were going out late or were not otherwise submitted to the USPS, in order to conceal the fraud.
Bigelow also requested refunds for mailings or portions of mailings that RMS failed to submit to USPS for delivery. If postage was paid for a mailing, but the mailing was not submitted for delivery, RMS, as a third-party mailer, could request a refund of 90% of the postage value. Bigelow requested these refunds for unsent pieces of mail and retained the funds as RMS revenue. The refunds requested were generally in amounts less than the $500 threshold that would have triggered additional scrutiny by USPS officials.
As a result of the scheme, at least 19 victims lost a total of $628,581.48.
As part of his plea agreement, Bigelow will be required to forfeit $628,581.48, representing postage payments made to RMS by its clients, but never paid to the USPS. In addition, Bigelow will be required to forfeit $13,500, which he withdrew from the RMS bank account and was used by his family members to purchase a car for their personal use.
Bigelow faces a maximum sentence of 20 years in prison and a fine of $250,000. U.S. District Judge Catherine C. Blake scheduled sentencing for July 30, 2013 at 9:00 a.m.
Stephen Reid, age 50, of Frederick, Maryland, previously pleaded guilty to the same charge and is scheduled to be sentenced on July 12, 2013 at 9:00 a.m.
United States Attorney Rod J. Rosenstein praised the U.S. Postal Inspection Service for its work in the investigation. Mr. Rosenstein thanked Special Assistant U.S. Attorney Sean C. Marlaire, who is prosecuting the case.
Former IRS Employee Sentenced to Prison for Falsely Certifying the Number of Hours He WorkedRead the Press Release
Baltimore, Maryland - U.S. District Judge George L. Russell III sentenced former IRS employee Antonio Keith Willabus, age 47, of Laurel, Maryland today to four months in prison, followed by three years of supervised release, for falsely certifying on his time and attendance records that he worked 353.1 hours in 2012 when in fact he had not. Judge Russell also ordered Willabus to serve 400 hours of community service and to pay restitution of $24,427.45.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Robert Geary of the Treasury Inspector General for Tax Administration.
According to his plea agreement, Willabus was a full time management and program analyst with the information technology service of the IRS. His office was located in New Carrollton, Maryland. During part of 2012, Willabus was permitted to work from home on Mondays and Tuesdays.In January 2012, the Treasury Inspector General for Tax Administration(TIGTA) began investigating Willabus’ time and attendance. The personal recording card Willabus was required to use to record his entry and exit at his office showed that Willabus rarely spent more than a few hours in the office on the days he was supposed to be there. Surveillance video of the building lobby showed that Willabus’ entries and exits were infrequent. People in adjacent offices rarely ever saw Willabus. His supervisors and coworkers frequently could not find Willabus, and were frustrated and perplexed when he did not respond to their emails during working hours.
On Monday and Tuesday of May 7 and 8, 2012, when Willabus was supposed to be working from home, TIGTA agents observed Willabus leave his house at 8:15 a.m. and then spend the day driving to locations in Baltimore. Agents believed Willabus was preparing to set up a bar business in Baltimore. He was seen moving a freezer from his truck into a bar building. Willabus did not return home or go into his office during his regular working hours on either day. On May 11, 2012, he entered data into his office time and attendance system claiming that he worked full days on May 7 and 8.
Cell site records from January through May 8, 2012 showed that Willabus frequently made calls on his cell phone from locations other than his home or office during the hours that he was supposed to be working. For work days between January 13 and June 8, 2012, Willabus falsely claimed to be working 353.1 hours that he did not actually work, for which he received a salary of $24,427.45.
United States Attorney Rod J. Rosenstein praised the Treasury Inspector General for Tax Administration for its work in the investigation and thanked Assistant U.S. Attorney Hollis Raphael Weisman, who is prosecuting the case.Former Baltimore Police Officer Pleads Guilty to Improperly Accessing A Protected ComputerRead the Press Release
Baltimore, Maryland – Former Baltimore Police officer Keith Nowlin, age 39, of Laurel, Maryland pleaded guilty today to accessing a protected computer without authorization, related to his obtaining motor vehicle information for a drug dealer.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Karl C. Colder of the Drug Enforcement Administration - Washington Field Division; and Commissioner Anthony W. Batts of the Baltimore Police Department.
According to his plea agreement, on June 18, 2010, Nowlin exchanged text messages with Marvin Mobley in which Mobley requested information on a specific motor vehicle. At the time, Nowlin was a Baltimore Police officer assigned to the Northeast District and Mobley, whose phone was part of a court-ordered wiretap, was under investigation for drug trafficking. In response to Mobley’s request, Nowlin responded “No problem anything for u.” Nowlin, who was not on duty at the time, requested the information through a Baltimore Police sergeant, who regularly makes such inquiries on behalf of officers for law enforcement purposes. The sergeant believed that Nowlin’s request was in furtherance of his police duties. Later that day, Nowlin and Mobley exchanged text messages and Nowlin provided Mobley with the identity of the vehicle’s owner. Nowlin improperly obtained the information using a protected computer network, which law enforcement agents are authorized to access for legitimate law enforcement purposes.
Nowlin faces a maximum sentence of one year in prison and a fine of $100,000. U.S. District Judge James K. Bredar scheduled sentencing for August 1, 2013 at 2:00 p.m.
Marvin Mobley previously pleaded guilty to possession with intent to distribute cocaine and crack cocaine and was sentenced to 10 years in prison.
United States Attorney Rod J. Rosenstein praised the DEA and Baltimore Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Peter J. Martinez, who is prosecuting the case.
Baltimore Tax Preparer Sentenced to 3 Years in Prison in Tax and Identity Theft SchemeRead the Press Release
Baltimore, Maryland - U.S. District Judge Catherine C. Blake sentenced Alexis Brett Travers, age 38, of Baltimore, Maryland, today to three years in prison followed by three years of supervised release for two counts of aiding in the preparation of false tax returns and aggravated identity theft. Judge Blake also entered an order that Travers pay $98,189 in restitution to the IRS for three years of personal taxes that she failed to pay, plus interest.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Thomas J. Kelly of the Internal Revenue Service - Criminal Investigation, Washington, D.C. Field Office.
“Return preparer fraud and identity theft are devastating for the victims, threaten the veracity of our tax system and cause tremendous financial hardship,” said Thomas J. Kelly, Special Agent in Charge, IRS Criminal Investigation, Washington DC Field Office. “Investigating refund fraud and identity theft is a top priority for IRS Criminal Investigation and we, along with our partners at the Department of Justice, will continue to pursue the criminals who commit these crimes and steal from innocent taxpayers and the U.S. Treasury."
According to her guilty plea, Travers owned ATB Tax Prep and Consulting Service which she operated out of her homes in Gwynn Oak, Maryland, and most recently, Baltimore. From 2006 to 2009, Travers concealed her identity as the paid tax preparer by not listing her or her company’s name on the federal income tax forms she filed, and by filing the forms electronically without obtaining a provider’s electronic filing identification number.
Travers filed at least 26 tax returns containing false business losses for taxpayers who did not operate a business, resulting in a tax loss of $137,406. Travers obtained a fee for her services from the deposit by the IRS of the tax refund into a bank account she controlled. Her fee was sometimes as high as $1,000 per taxpayer.
Travers failed to report the fees on her 2006, 2007 and 2008 tax returns, resulting in an additional tax loss of at least $87,000 for those three years.
Additionally, the tax return filed by Travers for a client, G.A., for tax year 2008 contained a false claim for the earned income credit. Travers stole personal identifying information, including year of birth and social security number, from another client to use in G.A.’s tax return in order to obtain a greater tax refund for G.A. The tax refund was then deposited into Travers’ bank account.
The total tax loss in this case is $224,000.
United States Attorney Rod J. Rosenstein commended the IRS Criminal Investigation for its work in the investigation and thanked Assistant United States Attorney David I. Sharfstein, who prosecuted the case.
Baltimore Armed Career Criminal Exiled to over 23 Years for Illegally Possessing A Gun Used in A MurderRead the Press Release
Defendant Convicted of the Murder in State CourtBaltimore, Maryland - U.S. District Judge J. Frederick Motz sentenced Antonio Edwards, age 29, of Baltimore, Maryland, today to 278 months in prison followed by five years of supervised release for being a felon in possession of a firearm. Judge Motz found that Edwards was an armed career criminal based on five previous convictions for possession with intent to distribute narcotics.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Steven L. Gerido of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; Baltimore City State’s Attorney Gregg L. Bernstein; and Baltimore Police Commissioner Anthony W. Batts.
According to Edwards' plea agreement, Edwards was identified by eyewitnesses as the person who murdered Kinlaw Jones on December 26, 2009, in the 1800 block of East Pratt Street, shooting him multiple times. Police recovered eight .45 caliber shell casings from the scene, two fired bullets from the victim’s clothing and four additional. .45 caliber fired bullets were recovered during the autopsy. On January 2, 2010, police received an anonymous tip that Edwards, who had been arrested, may have had a weapon at 3039 Kenyon Avenue in Baltimore. Police learned that Edwards had rented a bedroom from the owner of 3039 Kenyon Avenue, who told police that Edwards had paid rent of $150 for the month of December and that he had stayed there as recently as the week of December 25, 2009.
A search warrant was executed for Edwards’ bedroom in the Kenyon Avenue home on January 7, 2010, and police recovered paperwork in Edwards’ name, a baseball hat, a black beanie and photos of Edwards. From the ceiling, police recovered a .45 caliber semi-automatic pistol, a holster, a box of .45 caliber ammunition, and a clear bag with rubber gloves inside. Ballistics analysis confirmed that the shell casings recovered from the scene of the murder and from the victim were fired by the .45 caliber semi-automatic pistol recovered from the room Edwards was renting. Forensic analysis also confirmed that Edwards’ DNA was present on the grip of the gun, the holster, rubber gloves, baseball hat and black beanie.
As part of his federal plea agreement, Edwards pleaded guilty to first degree murder and use of a handgun in the commission of a crime of violence in Baltimore City Circuit Court, and is set to be sentenced in that case. Judge Motz ordered that Edwards’ federal sentence will be served concurrent to this state sentence.
United States Attorney Rod J. Rosenstein commended the ATF, Baltimore Police Department and Baltimore City State’s Attorney's Office, and especially Assistant State’s Attorney Christopher Mason, for their work in the investigation and prosecution. Mr. Rosenstein thanked Assistant United States Attorney Michael C. Hanlon, who prosecuted the case.
St. Mary’s County Man Sentenced to 25 Years for Sexually Exploiting Two Minor Girls to Produce Child PornographyRead the Press Release
Baltimore, Maryland - U.S. District Judge J. Frederick Motz sentenced Cary Anderson, age 33, of Dameron, Maryland, today to 25 years in prison, followed by lifetime supervised release, for sexually exploiting minors to produce child pornography. Judge Motz also ordered, that upon his release from prison, Anderson must register as a sex offender in the place where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA).
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; St. Mary’s County Sheriff Tim Cameron; and St. Mary’s County State’s Attorney Richard Fritz.
According to that statement of facts that was part of his guilty plea, Anderson began sexually molesting a young girl when she was 11 years old. From February 17 to February 24, 2012, Anderson sexually exploited the girl, who was then 13 years old, and produced images documenting the abuse. Further, on February 24, 2012, Anderson also sexually exploited a 15 year old girl he met on the internet and brought to his home, and produced visual depictions documenting the abuse.
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 "resources" tab on the left of the page.
United States Attorney Rod J. Rosenstein commended the FBI, St. Mary’s County Bureau of Criminal Investigations and the St. Mary’s County State’s Attorney’s Office for their work in the investigation and prosecution. Mr. Rosenstein thanked Special Assistant U.S. Attorney LisaMarie Freitas, assigned from the U.S. Department of Justice, Child Exploitation and Obscenity Section, who prosecuted the case.
Five Indicted in Armed Robbery Conspiracy in Which Two Victims Were ShotRead the Press Release
Charges the Result of Investigation by the FBI’s Cross Border Task ForceGreenbelt, Maryland - A federal grand jury has returned a superseding indictment today charging five men in connection with a series of armed robberies, including an armored car robbery and a carjacking in which a victim was shot.
The following defendants are charged in the indictment:
Tonnie Floyd, age 21.;
Marcellus Ramone Freeman, a/k/a Derrick Relando Pitts, age 22;
Anthony Terrell Cannon, age 23.;
Keith Willie Reed, age 23; and
Tobias Richard Dyer, age 21.
Floyd, Freeman, Cannon and Reed are all from Washington, D.C. Dyer is from Upper Marlboro, Maryland.
The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; the members of the FBI Cross Border Task Force - Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Assistant Director in Charge Valerie Parlave of the Federal Bureau of Investigation - Washington Field Office; Chief Mark A. Magaw of the Prince George’s County Police Department; Chief J. Thomas Manger of the Montgomery County Police Department; Chief Cathy L. Lanier of the Metropolitan Police Department; and by Chief Alan Goldberg of the Takoma Park Police Department.
The 10-count indictment alleges that between October 26 and December 11, 2012, the defendants planned and organized armed robberies and other crimes of violence, used stolen vehicles in the commission of the crimes and attempted to conceal their identities.
Specifically, the indictment alleges that on October 26, 2012, after obtaining a stolen vehicle and arming themselves, Floyd, Freeman and Cannon robbed a Garda employee at gunpoint outside a store in the 1300 block of University Boulevard in Takoma Park. During the robbery, the defendants stole approximately $3,911 and fired a gun. They attempted to escape in the stolen vehicle, but were unable to do so when the car was disabled. The defendants then allegedly carjacked another vehicle, shooting the driver. According to the indictment, Floyd, Freeman and Cannon fled into Washington, D.C., where they set the vehicle on fire and continued their escape.
On December 11, 2012, Reed, Dyer and Cannon allegedly obtained stolen vehicles and armed themselves, then attempted to rob the BB&T Bank on S. Glebe Road in Arlington, Virginia. The indictment alleges that Reed, Dyer and Cannon then robbed a Loomis employee at gunpoint outside a store in the 6300 block of Linvingston Road in Oxon Hill, Maryland. After shooting the employee, the defendants allegedly stole $2,350 and the .40 caliber semi-automatic handgun belonging to the Loomis employee, then took the stolen vehicles into Washington, D.C., where they were abandoned.
The defendants face a maximum sentence of 20 years in prison for the conspiracy and for each count of armed robbery; a maximum of life in prison for using, carrying and discharging a weapon during a crime of violence; and a maximum of 10 years in prison for interstate transportation of a stolen vehicle. Floyd, Freeman and Cannon also face a maximum of 25 years in prison for carjacking. An initial appearance has been scheduled for Freeman on April 16, 2013, in U.S. District Court in Greenbelt. Initial appearances for the remaining defendants have not yet been scheduled. The defendants are detained pending trial.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later crimina proceedings.
United States Attorney Rod J. Rosenstein praised the FBI Baltimore and Washington Field Offices, the Prince George’s County and Montgomery County Police Departments, the Metropolitan Police Department and the Takoma Park Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys William D. Moomau and Steven E. Swaney, who are prosecuting the case.
Company Owner Pleads Guilty to Failing to Pay TaxesRead the Press Release
Baltimore, Maryland – Jonas Purisch, age 39, of Perry Hall, Maryland pleaded guilty today to subscribing to a false tax return and failing to file a tax return.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Thomas J. Kelly of the Internal Revenue Service - Criminal Investigation, Washington, D.C. Field Office.
According to his plea agreement, Purisch owned and operated JP Staffing, Inc., a company based in Baltimore which provided temporary factory workers. JP Staffing paid its employees in cash. Purisch earned significant amounts of revenue from his operation of the business. In order to avoid paying income taxes, Purisch deposited his income from the business into one of his two personal bank accounts.
In the years 2006 and 2007, Purisch filed individual federal income tax returns which understated his income. Purisch falsely stated in his 2006 tax return that his income was $52,870, when in fact he deposited $276,572 of income into his personal bank accounts. Purisch’s unpaid personal income tax for 2006 was $17,851. Purisch falsely stated on his 2007 tax return that his income was $4,000, when in fact he earned $375,158, resulting in personal income tax liability of $48,410 for 2007.
Purisch deposited $457,499 of income into his personal bank accounts in 2008, and deposited $280,426 in 2009, but never filed a 2008 or 2009 tax return. Purisch’s unpaid personal income tax was $73,836 in 2008, and $41,100 in 2009.
The total tax loss in this case including interest on unpaid taxes is $210,019.04.
Purisch faces a maximum sentence of three years in prison and a fine of $250,000 for subscribing to a false tax return, and one year in prison and $100,000 fine for failing to file a tax return. Purisch will be required to pay restitution of $210,019.04 to the IRS, including interest. U.S. District Judge James K. Bredar scheduled sentencing for June 24, 2013, at 10:00 a.m.
United States Attorney Rod J. Rosenstein praised the IRS Criminal Investigation for its work in the investigation and thanked Assistant U.S. Attorney Peter M. Nothstein, who is prosecuting the case.
Virginia Settlement Attorney Pleads Guilty in Conspiracy to Fraudulently Obtain over $100 Million in SBA-backed LoansRead the Press Release
Attorney Used Her Law Firm and Settlement Company to Facilitate Fraudulent Loan ClosingsBaltimore, Maryland - Seung E. Oh, a/k/a Sandy Oh, age 44, of Great Falls, Virginia, pleaded guilty today to conspiracy to commit bank fraud and money laundering, in connection with a scheme to fraudulently obtain business loans guaranteed by the Small Business Administration, with resulting losses of over $100 million.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Small Business Administration Inspector General Peggy E. Gustafson; Postal Inspector in Charge Gary R. Barksdale of the U.S. Postal Inspection Service - Washington Division; and Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation.
According to her plea agreement, Oh is an attorney with offices in Annandale, Virginia and the owner operator of Washington Settlement Group (WSG), a title company located in Annandale. In about 1998, Oh met Joon Park and his brother, Loren Park, who owned and operated Jade Capital, a loan brokerage company. Oh knew that Jade Capital specialized in securing loans for individuals interested in purchasing and refinancing small businesses in the Mid-Atlantic area, some of which were settled through Oh’s law firm and WSG. Oh knew that the Parks encouraged prospective borrowers using the services of Jade Capital to apply for business loans through the SBA’s Section 7(a) program, which guaranteed 75% - 90% of qualified loans made by banks and other commercial lending institutions. Under this program, the principals of the small business seeking the loan were required to invest a certain amount of their own money, called an equity injection, before they qualified for a loan. The banks and other lending institutions making the loan bore the risk of payment default only up to the percentage of the loan not guaranteed by the SBA.
Over the course of Oh’s relationship with Joon and Loren Park, and to foster more business with their company, Oh agreed to use her settlement company and law firm to facilitate loan closings for deals that would otherwise fail to meet the lending parameters of the banks making the loans, including banks authorized to lend under SBA’s Section 7(a) program. Oh helped the Parks misrepresent to the banks and to the SBA the true amount of money involved in the transactions and/or the true names of the parties taking part in the transactions.
To accomplish this, Oh sometimes agreed to “netting” a transaction, whereby the Parks would negotiate a sale price with the seller that was less than the price listed on the sales contract submitted to the bank, and/or they would increase the loan by the amount needed for the down payment. In so doing, they reduced the amount of money that the buyer actually had to inject into the deal and concealed that the buyer did not have sufficient equity to qualify for the loan. To conceal these arrangements, Oh completed the settlement sheets as if the buyer had made the required cash injection and the seller had received the full contract price.
Another way that Oh helped to facilitate the loan closing for Jade Capital was when she “fronted” the buyer’s cash injection. Oh temporarily loaned part of the buyer’s up-front payment by taking other people’s money out of the escrow accounts of either her law firm or her title company. Joon and Loren Park then paid back the fronted money after the settlement, usually from their share of the proceeds from that deal or a later one. As with the “netting” scheme, the settlement sheets and all other related documents for the “fronted” deal would falsely reflect that the buyer injected his own money into the transaction in accordance with the agreed upon financing terms established by the lending institution.
Oh faces a maximum penalty of 30 years in prison for the bank fraud conspiracy; and a maximum of 20 years in prison for money laundering. As part of her plea agreement, Oh will be required to pay a money judgment of $11,832,000 and forfeit all the property involved in the offense. U.S. District Judge William D. Quarles, Jr. has scheduled sentencing for July 9, 2013 at 1:00 p.m.
Joon Park, a/k/a “Joon Pak,” and “Joon Paik,” age 43, of Falls Church, Virginia, pleaded guilty and is scheduled to be sentenced on May 28, 2013 at 1:00 p.m. Nick Park, a/k/a Nochol Park, age 46, of McLean, Virginia, was sentenced to 33 months in prison; and Joo Hyuk “John” Lee, age 39, of Richmond, Virginia, and Sang Hyun Kim, age 35, of Fairfax, Virginia, were each sentenced to three years in prison, for conspiracy to commit bank fraud. Kim’s wife, In Jung Ham, age 30, also of Fairfax, was sentenced to a year and a day in prison, for her role in the scheme. Judge Quarles ordered Lee to pay restitution of $1,900,325 and ordered Ham to pay restitution of $216,472.92. Lee, Kim and Ham were also ordered to forfeit the proceeds of the scheme and pay money judgments of $18,764,900, $13,432,000 and $15,725,000, respectively.
This law enforcement action is part of President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.
United States Attorney Rod J. Rosenstein thanked the SBA Office of Inspector General, U.S. Postal Inspection Service and FBI for their work in the investigation. Mr. Rosenstein praised Assistant U.S. Attorneys Leo J. Wise and Martin J. Clarke, who are prosecuting the case.
Landover Felon Exiled to 10 Years in Prison for Illegal Possession of A GunRead the Press Release
Greenbelt, Maryland - U.S. District Judge Roger W. Titus sentenced Derek Lamarr Gaines, age 25, of Landover, Maryland, today to 10 years in prison followed by three years of supervised release for being a felon in possession of a firearm.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Steven L. Gerido of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; Chief Buddy Robshaw of the Cheverly Police Department; and Colonel Marcus L. Brown, Superintendent of the Maryland State Police.
According to Gaines’ plea agreement, on August 12, 2011, Gaines was seated in the back seat passenger side of a vehicle being driven by Jonathan Jerome Winston, with a third person in the front passenger seat. A law enforcement officer pulled the vehicle over for a traffic stop and detected the odor of phencyclidine (PCP) coming from the rear passenger compartment. The officer ordered Gaines out of the vehicle. As Gaines stepped out of the car he ran away, throwing a handgun that was in his waistband. Officers arrested Gaines and recovered a 9mm semi-automatic handgun with one bullet in the chamber and an extended magazine containing 29 rounds of ammunition; a vial of PCP; and a black ski mask.
When Gaines ran away, the front seat passenger also tried to flee and Winston attempted to drive away. Both were caught by police and placed under arrest. A black ski mask was recovered from Winston’s pocket. A search of the vehicle recovered two additional guns - a 9mm semi-automatic handgun and a .45 caliber machine gun with a 12.5 inch magazine loaded with 38 rounds of .45 caliber ammunition; and a third black ski mask.
Additional investigation revealed that the two 9mm firearms were previously reported stolen.
Jonathan Jerome Winston, age 23, of Washington, D.C., pleaded guilty and was sentenced to 71 months in prison.
United States Attorney Rod J. Rosenstein commended the ATF, Cheverly Police Department, and the Maryland State Police for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorney William D. Moomau, who prosecuted the case.
Former Employee Pleads Guilty to Embezzling Funds from Labor UnionRead the Press Release
Baltimore, Maryland – Cora Carper, age 32, of Churchton, Maryland, pleaded guilty today to embezzlement from a labor union, in connection with a scheme to steal at least $200,000 from the union’s political action committee.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and District Director Mark Wheeler of the U.S. Department of Labor, Office of Labor – Management Standards.
According to her plea, Carper was a secretary with the International Association of Heat and Frost Insulators and Allied Workers, assigned to perform clerical tasks associated with the operation of the Insulators Political Action Committee (PAC) fund. Carper’s duties included processing disbursement requests. Disbursement requests had to be made in writing and only the Insulators General President, General Secretary-Treasurer, Political Director and officers of the Insulators local unions had authority to request disbursements from the PAC fund. Once Carper received a written request for disbursement from an appropriate official, she was supposed to print a check from the PAC fund account that contained the electronic signatures of the Insulators General President and General Secretary-Treasurer and forward that check to the recipient. Carper also entered PAC fund receipts and deposits into a computerized ledger, made deposits in the PAC fund, and received and reconciled monthly PAC fund bank statements against the electronic ledger.
Carper admits that between June 2009 and February 2011, she printed more than 300 checks totaling approximately $502,586, from the PAC fund account made payable to “cash,” “cash reimbursement,” or “petty cash.” Union officials stated that Carper printed and cashed the checks, without authorization, often cashing multiple PAC fund checks the same day. Carper endorsed the back of all but 13 of the more than 300 checks she cashed. During the time of the embezzlement Carper deposited at least $180,000 into her personal bank accounts. To cover up her embezzlement, Carper made false entries in the computerized ledger indicating that the checks were written for donations to political candidates, expense reimbursements or expenses for conferences. In fact, the checks were made payable to cash, cashed by Carper and then used for her personal benefit.
In early 2011 Carper was confronted about her embezzlement by the Insulators General President. Carper admitted that she had taken $7,300, but denied further embezzlement. Her family paid the Insulators $7,300. A subsequent internal investigation by the Insulators and by the Department of Labor, Office of Labor - Management Standards revealed that Carper’s embezzlement far exceeded her limited admission, with $502,586 in checks attributed to Carper’s embezzlement.
Carper faces a maximum sentence of five years in prison and a fine of $250,000. As part of her plea agreement, Carper will be required to pay restitution in the full amount of the victim’s losses, which will be determined at sentencing. U.S. District Judge George L. Russell III has scheduled Carper’s sentencing for June 4, 2013, at 9:30 a.m.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
United States Attorney Rod J. Rosenstein thanked U.S. Department of Labor, Office of Labor - Management Standards for its work in the investigation. Mr. Rosenstein praised Assistant U.S. Attorney Kristi N. O’Malley, who is prosecuting the case.
Capitol Heights Felon Exiled to over 10 Years in Prison for Illegal Possession of FirearmsRead the Press Release
Greenbelt, Maryland - U.S. District Judge Roger W. Titus sentenced Jamal Antwon Holder, age 23, of Capitol Heights, Maryland, today to 125 months in prison, followed by three years of supervised release, on three counts of being a felon in possession of a gun.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Steven L. Gerido of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; and Chief Mark A. Magaw of the Prince George’s County Police Department.
According to Holder's plea agreement, on November 15, 2011, Holder sold a 12 gauge sawed-off shotgun to a law enforcement source. On November 16, 2011, Holder sold a bolt action rifle and a 30/30 lever action rifle to the law enforcement source. Finally, on November 17, 2011, Holder sold a .38 caliber revolver to the law enforcement source. All of these transactions took place at an apartment complex in Capitol Heights. Each sale was observed by law enforcement officers and was video and/or audio recorded. After the completion of each transaction, the source met with law enforcement officers and turned over the firearms purchased from Holder.
Holder’s previous felony assault convictions prohibited him from possessing firearms.
United States Attorney Rod J. Rosenstein commended the ATF and Prince George’s County Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys William D. Moomau and Steven E. Swaney, who prosecuted the case.
Baltimore Drug Dealer and 9 Time Convicted Felon Exiled to 15 Years in Prison for Illegal Possession of Guns and AmmunitionRead the Press Release
Baltimore, Maryland - U.S. District Judge Ellen L. Hollander sentenced Derrick Woodlon, age 34, of Baltimore, today to 15 years in prison, followed by three years of supervised release, for being a felon in possession of a firearm and ammunition. Judge Hollander found that Woodlon was an armed career criminal based on nine previous drug convictions.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Steven L. Gerido of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; Baltimore City State’s Attorney Gregg L. Bernstein; and Baltimore Police Commissioner Anthony W. Batts.
According to Woodlon’s plea agreement, Baltimore Police officers observed Woodlon operating a drug shop in the 1000 block of Boyd Street in Baltimore. On August 18, 2011, an undercover Baltimore Police officer purchased two gel caps of heroin using a pre-marked $20 bill. Officers subsequently arrested Woodlon and recovered the marked bill. On November 18, 2011, Baltimore Police officers observed Woodlon supplying the Boyd Street drug shop from a location on North Woodington Avenue, in Baltimore. Officers executed a search warrant at the North Woodington home later that day and recovered three loaded .357 caliber handguns, one of which had been reported stolen a year earlier. Officers also recovered 26 grams of crack cocaine, 44 grams of heroin, drug paraphernalia and approximately $26,000 in cash.
As a result of Woodlon’s previous convictions he was prohibited from possessing a gun or ammunition.
United States Attorney Rod J. Rosenstein commended the ATF, Baltimore Police Department and Baltimore City State’s Attorney's Office for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys Kenneth S. Clark and James T. Wallner, who prosecuted the case.
Former SSA Executive Sentenced to 15 Months in Prison for Embezzling over $400,000 and Tax EvasionRead the Press Release
Baltimore, Maryland - U.S. District Judge J. Frederick Motz sentenced Salvatore Petti, age 76, of Ellicott City, Maryland today to 15 months in prison followed by three years of supervised release for evading payment of taxes on income earned from a Social Security Administration (SSA) employee association and embezzling funds from the association. Judge Motz also entered an order that Petti: forfeit approximately $83,000 in proceeds held in bank accounts, and from the sale of a personal seat license for the Baltimore Ravens and three Marriott timeshares; and pay restitution totaling $570,493 - $299,724 to the employee association for the funds he embezzled; and $270,769 to the IRS for unpaid taxes from 1998 through 2009.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Thomas J. Kelly of the Internal Revenue Service - Criminal Investigation, Washington, D.C. Field Office.
“There are serious consequences for this type of criminal conduct,” said Thomas J. Kelly, Special Agent in Charge, IRS Criminal Investigation, Washington, D.C. Field Office. “Mr. Petti’s act of intentionally under-reporting income on his federal tax returns is unlawful. Today’s sentence demonstrates the collaborative effort between IRS Criminal Investigation and its federal law enforcement partners in bringing individuals to justice who choose to engage in any financial scheme to defraud the American public.” Petti worked for the SSA for more than 40 years, retiring in 1995 as a District Director. He also served as the treasurer for the Employees Activities Association (EAA) of the SSA, located in Woodlawn, Maryland. The EAA provided social, recreational, welfare, health and athletic activities for its members, the employees of the SSA. EAA was comprised of multiple entities, including two for-profit and three non-profit entities. Between 2005 and 2008, Petti earned an annual salary from the EAA of approximately $60,000.
According to his plea, in 2009, the SSA Office of Inspector General audited the EAA and discovered that Petti had not reported any EAA income to the IRS between 2006 and 2008. Indeed, by February 2009, Petti had not reported to the IRS any EAA income from at least 1998 through 2009. Petti was also able to evade paying taxes on his salary from EAA by classifying himself as an independent contractor, when he in fact knew that he should have been classified as an employee. Unlike other employees of EAA who had income, Social Security, and Medicare taxes withheld from their paychecks, Petti did not. Even though he classified himself as an independent contractor, Petti did not issue himself a Form 1099, he did not send the IRS a Form 1099 showing the income he received, and he did not report his EAA income to the IRS when he filed his false tax returns.
The auditors told Petti in February 2010 that Petti’s EAA income would be reported to the IRS. The next month, Petti filed amended tax returns for the years 2006 through 2009, reporting his EAA salary. Petti, however, included false expenses for purported “office expenses,” “supplies,” “travel” and “utilities.”
Further investigation revealed that Petti was embezzling substantial funds from the EAA. Between 2005 and 2009, in addition to the $60,000 salary he was entitled to receive, Petti issued unauthorized checks to himself, which he falsely classified as “administrative expenses” and “general expenses,” in order to conceal his theft from EAA. Additionally, because Petti knew that the outside accounting firm audited the non-profit entities but not the for-profit entities, Petti issued the checks to himself from the for-profit entities’ bank accounts in order to hide the unauthorized income from the accounting firm. By doing so, Petti was able to hide approximately $416,000 of unauthorized payments to himself between 2005 and 2009. Petti did not report the $416,134 of additional, unauthorized income on either his original tax returns for years 2005 through 2009, nor on his amended tax returns in 2006 through 2009.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
United States Attorney Rod J. Rosenstein thanked the SSA - OIG for its assistance in the case. Mr. Rosenstein commended the IRS Criminal Investigation for its work in the investigation and praised Assistant U.S. Attorney David I. Sharfstein, who prosecuted the case.
Baltimore Man Sentenced in Mortgage Fraud SchemeRead the Press Release
Lenders, Including Fannie Mae and Freddie Mac, Lost Over $1 Million from Fraudulently Obtained LoansBaltimore, Maryland - U.S. District Judge James K. Bredar sentenced Kenneth Koehler, age 43, of Baltimore, today to 18 months in prison followed by two years of supervised release for conspiracy to commit wire fraud in connection with a mortgage fraud scheme in which fraudulent loans were obtained on six properties, all of which subsequently went into foreclosure. Five of those properties, accounting for over $790,000 in losses, were on the same street - four of them in the same block. Judge Bredar ordered Koehler to pay restitution of $1,007,812.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Inspector General Steve A. Linick of the Federal Housing Finance Agency; and Postal Inspector in Charge Gary R. Barksdale of the U.S. Postal Inspection Service - Washington Division.
From 2004 through 2008, Koehler invested in Baltimore residential real estate. Koehler obtained financing for the purchase and sale of his properties from Worthington Mortgage Group, LLC, a mortgage brokerage company controlled by a former business partner.
According to his guilty plea, beginning in 2006 Koehler conspired with his former business partner to obtain loans for Worthington Mortgage clients under false pretenses. They used Voicebank, a technology employee leasing company that they had previously owned, as a fictitious employer for Worthington borrowers who needed fraudulent verifications of their employment. Voicebank had ceased doing business in 2001. The Voicebank phone number activated a voice mail message accessible to both Koeher and his partner. If called upon by the lender, either Koehler or his partner would verify the employment or income information supplied on the loan application.
Koehler obtained two loans by fraudulently inflating his own monthly income. In 2006, Koehler signed a loan application prepared by his co-conspirator to refinance a loan on property at 229 S. Chapel Street in Baltimore, which falsely stated that Koehler earned $20,000 per month with Voicebank. Both Koehler and the co-conspirator knew that he was self-employed. In 2007 the same false information was submitted on a loan application to purchase property at 2217 Gough Street in Baltimore. Both properties went into foreclosure, resulting in losses of more than $221,000 to lenders, including the Federal National Mortgage Association (Fannie Mae).
In 2007 and 2008, Koehler and his co-conspirator also arranged for another individual to purchase three properties, and for that individual’s brother to purchase a fourth property, all located on S. Chapel Street and all owned by Koehler. In all four cases, Koehler concealed the true purchase price of the properties from the lenders by signing the settlement sheet stating that he had received a substantial down payment from the buyers, when in fact no such payments had occurred. Koehler also kicked back part of the sales proceeds from each loan to the buyers, further reducing the sales price of the property. By concealing the true sales price for the properties, the conspirators manipulated the lenders into funding more than 100% of the purchase price. All four properties went into foreclosure, resulting in losses of more than $686,000 to Fannie Mae and Federal Home Loan Mortgage Association (Freddie Mac).
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
United States Attorney Rod J. Rosenstein commended the FBI, Federal Housing Finance Agency - Office of Inspector General and U.S. Postal Inspection Service for their investigative work. Mr. Rosenstein thanked Assistant U.S. Attorney Gregory R. Bockin, who prosecuted the case.
Vice President of Frederick Mail Preparation Service Pleads Guilty to Fraud Resulting in Losses of over $628,500Read the Press Release
Majority of Victims Were Non-Profit Clients Who Relied on the Mailings to Raise FundsBaltimore, Maryland – Stephen Reid, age 50, of Frederick, Maryland, pleaded guilty today to conspiracy to commit mail and wire fraud relating to the failure to provide contracted-for services to clients of Reid’s company, RMS Direct, Inc., resulting in losses of over $628,500.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Postal Inspector in Charge Gary R. Barksdale of the U.S. Postal Inspection Service - Washington Division.
“In addition to defrauding postal customers, this scheme jeopardized the reputation of the U.S. Postal Service with its customers,” said Gary Barksdale, Inspector in Charge, Washington Division, U.S. Postal Inspection Service. Mr. Barksdale continued, “Through investigations such as this, postal inspectors will continue to protect postal customers and ensure thePostalService retains its reputation as the most trusted government agency.”
According to his plea agreement, Reid was the vice president and part-owner of RMS Direct, Inc., a mail preparation service located in Frederick, Maryland, with over 200 clients and revenues of over $5 million per year. Under the supervision of Reid and his co-conspirator, RMS entered into contracts to prepare and submit to the U.S. Postal Service (USPS), large-volume mailings, typically made up of pamphlets, brochures, books, and other printed materials.
RMS clients were primarily non-profit corporations that relied upon the mailings sent through RMS to raise funds, and the timing of the mailings was essential to their fundraising efforts. RMS assembled the mailings, applied the postage and addresses, and organized the pieces of mail for submission to the USPS. RMS submitted the mailings to a full-time USPS Acceptance Clerk that was assigned to its office. As proof that the mailings went out, RMS then emailed its clients either of two USPS documents – a postage statement signed and certified by the USPS Acceptance Clerk or a Mailing Transaction Receipt printed from an online USPS database. Both documents included information as to the dates, times, number of pieces of mail and postage paid. Once the RMS client received a statement, it would remit payment to RMS.
Reid admitted that the conspiracy began in 2005, when he and his co-conspirator falsified postage statements to misrepresent to RMS clients that mailings were being sent out in a timely fashion when, in fact, the mailings were late. Beginning in 2009, Reid and his co-conspirator selected certain mailings or portions of mailings that would not be submitted at all to USPS for delivery. Reid and his co-conspirator made sure that the documentation sent to the RMS client was falsified to indicate that the full mailing had been submitted, thereby causing the client to overpay RMS for postage and services.
To accomplish the fraud, Reid, his co-conspirator, and RMS employees operating at their direction, generated false postage statements, forged the signature of the USPS Acceptance Clerk and created a false impression of the special USPS date stamp used on the postage statement. In 2006, RMS employees made an unauthorized copy of the USPS Acceptance Clerk’s key to the filing cabinet where the official date stamp was kept. From that time until 2010, Reid, his co-conspirator, and RMS employees operating at their direction used the copied key to gain access to the date stamp when the USPS Acceptance Clerk was not present in order to falsify postage statements. Beginning in 2010, when the computer-generated Mailing Transaction Receipt was adopted by the USPS to certify mailings, Reid and his co-conspirator falsified those as well, using a document that had been created, which, when printed, looked identical to the USPS Mailing Transaction Receipt. Reid and his co-conspirator directed RMS employees to use this document to create false Mailing Transaction Receipts, which were then sent to RMS clients as proof of the timely and complete submission of their mailings.
Reid and his co-conspirator took other measures to conceal the fraud and prolong the victimization of RMS clients. For example, RMS clients often included pieces of mail known as “seeds,” in the mailings they provided to RMS. These “seeds” were sent to particular individuals or addresses so that the client could track the timing and appearance of the mailing. Reid’s co-conspirator directed RMS employees to make sure to deliver the “seeds” from the mailings that were going out late or were not otherwise submitted to the USPS, in order to conceal the fraud.
As a result of the scheme, at least 19 victims lost a total of $628,581.48.
Reid faces a maximum sentence of 20 years in prison and a fine of $250,000. As part of his plea agreement, Reid will be required to forfeit $628,581.48. U.S. District Judge Catherine C. Blake scheduled sentencing for July 12, 2013 at 9:00 a.m.
United States Attorney Rod J. Rosenstein praised the U.S. Postal Inspection Service for its work in the investigation. Mr. Rosenstein thanked Special Assistant U.S. Attorney Sean C. Marlaire, who is prosecuting the case.
Potomac Man Sentenced for Obstructing Investigations to Obtain/maintain a Government Security ClearanceRead the Press Release
Baltimore, Maryland - U.S. District Judge Ellen L. Hollander sentenced Gurpreet Singh Kohli, age 58, of Potomac, Maryland, late on March 29, 2013, to six months of home detention with electronic monitoring, as part of three years’ probation, for obstruction of agency proceedings, in connection with false statements he made to investigators during his background investigation for a high level government security clearance. Judge Hollander also ordered Kohli to pay a fine of $30,000.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Special Agent in Charge William Winter of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); and Special Agent in Charge Robert Craig of the Defense Criminal Investigative
Service - Mid-Atlantic Field Office (DCIS).
“The Defense Criminal Investigative Service is committed to supporting America’s warfighter and protecting the interest of the American taxpayers” said Robert Craig, Special Agent in Charge for the DCIS Mid-Atlantic Field Office. “The technology developed to support our warfighters is key to their safety and safety of all Americans. DCIS is committed to pursuing anyone who purposefully endangers our warfighters and our national security for personal gain”.
According to his plea agreement, from November 2002 through March 2011, Kohli operated NAVTEC, LLC from his residence and locations in India. NAVTEC was registered with the U.S. Department of State to act as a broker in the sale and transfer of U.S. manufactured defense electronics and related components. NAVTEC represented U.S. based manufacturers and suppliers of sophisticated defense electronics. The majority of NAVTECs customers were Indian government and military and defense-related agencies. Kohli was responsible for the day to day decision making and operations of NAVTEC.
From September 2003 through April 4, 2011, Kohli also held a full-time position with a defense electronics and weapons manufacturer based in Maryland, for which he was required to obtain and maintain a U.S. government security clearance. As part of his job, Kohli was involved in developing business opportunities with Indian military and defense-related government entities. Kohli did not reveal to his employer the full scope of his activities with NAVTEC, nor did he reveal his employment with the Maryland company to all of NAVTEC’s U.S. based clients.
Kohli admitted that during two separate background investigations by the Office of Personnel Management relative to his security clearance, required to maintain his employment with the Maryland defense contractor, he made a number of false statements and representations regarding his activities for NAVTEC and his contacts with foreign nationals. Specifically, Kohli minimized the nature and scope of his activities with NAVTEC and under oath denied that he had any established foreign business contacts or associations with Indian government organizations. Other false statements included that his contact with foreign nationals was limited to relatives in India; that his foreign business travel was limited to attending trade and air shows on behalf of the Maryland defense contractor; and that his contact with a foreign government or its representatives was limited to business meetings in the U.S. on behalf of the Maryland defense contractor. During a follow-up interview with an OPM investigator on March 9, 2011, Kohli falsely denied having any other employment or business ventures outside of his employment with the Maryland defense contractor.
In fact, Kohli admits that he traveled to India periodically to meet with NAVTEC’s Indian government clients and conduct NAVTEC business. Occasionally, Kohli was accompanied by representatives of the defense electronics manufacturers/suppliers that NAVTEC represented, as well as his son, who assisted with NAVTEC business.
On September 7, 2010, Kohli was interviewed by agents from the FBI and ICE Homeland Security Investigations in relation to his son’s pending application for employment with the FBI. Kohli minimized his son’s role with NAVTEC, his contact with NAVTEC’s U.S. clients and Indian customers, and falsely stated that his wife ran NAVTEC. Kohli also lied about the purpose of his Indian travel, stating that his foreign travel was limited to matters involving his employment with the Maryland defense contractor and that he did not meet with Indian government officials.
United States Attorney Rod J. Rosenstein praised the FBI, HSI Baltimore and DCIS for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Christine Manuelian, who prosecuted the case.
New York Pimp Pleads Guilty to Sex TraffickingRead the Press Release
Baltimore, Maryland - Charles Anderson, a/k/a “Chuck Corners,” a/k/a “Yowzer,” age 25, of Brooklyn, New York, pleaded guilty today to conspiracy to commit sex trafficking.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; and Chief J. Thomas Manger of the Montgomery County Police Department.
According Anderson’s plea agreement, he assisted his co-conspirator, a long-time friend of Anderson’s, who targeted female prostitutes between the ages of 19 and 28, to force them to work for him by engaging in commercial sex acts in order to make money. Anderson helped his co-conspirator locate female prostitutes that were working alone (i.e., without the oversight of a pimp) by searching websites that hosted advertisements for commercial sex services, then called or text messaged the telephone numbers listed in the advertisements, masquerading as a prospective client, helping his co-conspirator to schedule a hotel “date” with prostitutes. On other occasions, Anderson agreed to loan his cellular phone to his co-conspirator so he could call the prostitutes directly from an unrecognized telephone number. Anderson knew that his co-conspirator intended forcibly to coerce the girls to work as his prostitutes.
Anderson and the co-conspirator shared an apartment in Brooklyn, where Anderson saw the co-conspirator bring female prostitutes against their will. The prostitutes stayed in the co-conspirator’s room, where Anderson sometimes overheard his co-conspirator physically assaulting the females and forcing them to perform sex acts. On one occasion in the Spring of 2010, his co-conspirator returned to the apartment with a prostitute who had been brought there against her will, while at least two additional females were already detained against their will within the co-conspirator’s bedroom. Anderson had agreed to monitor the involuntary detainees while his co-conspirator traveled for approximately six hours in search of an additional female prostitute in Maryland. Anderson also helped his co-conspirator locate female victims who had escaped. He was also aware that his co-conspirator had two firearms in the apartment, a .9mm pistol and a larger sub-machine gun, along with corresponding ammunition.
While his co-conspirator was incarcerated in the Spring of 2010, Anderson agreed to hold the prostitutes’ earnings, which he later provided to his co-conspirator. These prostitutes both received clients inside the apartment and attended “outcall dates,” meeting clients at locations outside of the apartment.
Anderson faces a maximum of life in prison for sex trafficking. U.S. District Judge J. Frederick Motz has scheduled sentencing for June 14, 2013 at 2:15 p.m.
The case was investigated by the Maryland Child Exploitation Task Force, with assistance from the Maryland Human Trafficking Task Force, which was formed in 2007 to discover and rescue victims of human trafficking while identifying and prosecuting offenders. Members of both task forces include federal, state and local law enforcement. The Maryland Human Trafficking Task Force also includes victim service providers and local community members. For more information about the Maryland Human Trafficking Task Force, please visit www.justice.gov/usao/md/Human-Trafficking/index.html.
United States Attorney Rod J. Rosenstein commended the FBI’s Baltimore and New York offices and the Montgomery County Police Department for their work in the investigation and thanked the Montgomery County State’s Attorney’s Office, the Department of Homeland Security and the New York Police Department for their assistance. Mr. Rosenstein thanked Assistant U.S. Attorneys Mark W. Crooks and Paul E. Budlow, who are prosecuting the case.
Former Social Worker Pleads Guilty to Health Care FraudRead the Press Release
Continued to Practice After Her License Was Suspended in 2005Greenbelt, Maryland – Rosemary McDowall, age 59, of Silver Spring, Maryland pleaded guilty today to health care fraud.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation.
According to her plea agreement, in 1996, McDowall, a licensed social worker, signed a contract to become a participating provider with Blue Cross Blues Shield of Maryland (BCBS). As a participating provider, McDowall was obligated to accept payment for services rendered directly from BCBS. Under the terms of her contract, McDowall was obligated to notify BCBS if she lost her license to practice as a social worker.
In 2005, McDowall’s license to practice as a social worker was suspended by the Maryland State Board of Social Work Examiners, for numerous violations. McDowall failed to report to BCBS that her license to practice was suspended, as was required under her contract, and she continued to see patients and caused claims to be submitted to BCBS. In 2008, BCBS terminated McDowall as a participating provider, but McDowall continued to be a non-participating provider with BCBS and was permitted to collect her allowed fees from the patient and then BCBS would reimburse the patient the allowed amount. Despite the fact that her license to practice social work had been suspended, McDowall continued to see patients and submitted claim forms to BCBS.
In 2010, BCBS learned that McDowall had not been licensed to practice social work since 2005 and stopped paying all claims submitted by McDowall or BCBS members who had seen McDowall for treatment. McDowall admitted that fraudulent claims submitted during the scheme total between $120,000 and $200,000.
McDowall faces a maximum sentence of 10 years in prison and a fine of $250,000 for health care fraud. As part of her plea agreement, McDowall will be required to pay restitution in the full amount of the loss. U.S. District Judge Roger W. Titus scheduled sentencing for July 8, 2013 at 3:00 p.m.
United States Attorney Rod J. Rosenstein praised the FBI for its work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Mara Zusman Greenberg and Kristi N. O’Malley, who are prosecuting the case.
Upper Marlboro Man Sentenced to 10 Years in Prison for Distribution of Crack CocaineRead the Press Release
Greenbelt, Maryland - U.S. District Judge Peter J. Messitte sentenced Weldon Emanuwell Gordon, age 35, of Upper Marlboro, Maryland, today to 10 years in prison followed by five years of supervised release for possession with intent to distribute crack cocaine.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Karl C. Colder of the Drug Enforcement Administration - Washington Field Division; and Chief Mark A. Magaw of the Prince George’s County Police Department.
According to Gordon's plea agreement, in January 2009, law enforcement executed a search warrant at his apartment in Upper Marlboro and seized 379.2 grams of crack cocaine, an electronic scale with cocaine residue, and $18,729 in cash.
Gordon is currently serving a life sentence for his conviction in the District of Columbia for conspiring to murder a witness in a separate case.
United States Attorney Rod J. Rosenstein commended the DEA and the Prince George’s County Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorney William D. Moomau, who prosecuted the case.
Randallstown Man Sentenced to Prison for Assaulting a Federal Officer on the Baltimore-Washington ParkwayRead the Press Release
Greenbelt, Maryland - U.S. District Judge Peter J. Messitte sentenced Jesse Lee Bell, age 39, of Randallstown, Maryland, today to one year in prison, followed by six months of community confinement, and three years of supervised release, for assaulting a federal officer.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Chief Teresa Chambers of the U.S. Park Police.
According to his plea agreement, on August 27, 2011, at 3:13 a.m. Bell was pulled over by a U.S. Park Police officer on the Baltimore Washington Parkway, after the officer saw Bell’s pick-up truck drift out of its lane, straddle the lane marking, and then jerk back into its lane. The officer smelled the odor of an alcoholic beverage coming from the car as he stood next to the driver’s window. In response to the officer’s questions, Bell stated that he had a beer hours earlier, but said there was no alcohol or drugs in the truck. The officer ordered Bell to get out of his truck to perform field sobriety tests. Bell became nervous, did not get out of the truck, and ignored the officer’s repeated commands to unlock the door. As the officer was reaching in through the open window to unlock the door, Bell drove onto the highway, with the officer’s arm still inside the truck. The truck struck the officer, who spun around and fell to the ground in the right lane of the highway. The officer saw cars coming toward him at highway speeds, but the drivers were able to swerve into the left lane to avoid striking the officer. The officer turned around and saw Bell driving northbound on the highway with his headlights turned off. The officer and a backup followed Bell, who eventually pulled onto the shoulder of the road again. The officers got the defendant out of the truck and arrested him.
United States Attorney Rod J. Rosenstein commended the U.S. Park Police for its work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Hollis R. Weisman, who is prosecuting the case.
Montgomery County Man Sentenced to Prison in Mortgage Fraud ConspiracyRead the Press Release
Submitted Fraudulent Applications to Obtain Loans Totaling Over $2.2 MillionGreenbelt, Maryland - U.S. District Judge Peter J. Messitte sentenced Dennis O. Edwards, age 49, of Silver Spring, Maryland, today to 21 months in prison, followed by three years of supervised release, for conspiracy to commit bank fraud in connection with a scheme in which he submitted fraudulent loan applications to obtain over $2.241 million to purchase or refinance homes. Judge Messitte also ordered Edwards to pay restitution of $625,000.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Inspector General Steve A. Linick of the Federal Housing Finance Agency; and Howard County Police Chief William McMahon. According to Edwards’ guilty plea, in early January 2006, Edwards fraudulently obtained mortgage loans totaling $342,000, to purchase a home in Silver Spring, Maryland, by falsely claiming on the loan applications that he worked as a nurse and as a mover, earning a combined $6,000 a month from both employers. In fact, Edwards was unemployed at the time and received social security disability payments of approximately $1,000 a month.
A co-conspirator whom Edwards met while he was purchasing the Silver Spring property worked as a loan officer at a bank. The co-conspirator arranged for Edwards to purchase a property in Hyattsville, Maryland, obtaining a loan for $384,750, and subsequently refinancing that loan, based upon fraudulent loan applications that falsely inflated Edwards’ income. In January 2006, the co-conspirator purchased a residence in Columbia, Maryland, by obtaining loans totaling $1.595 million in Edwards’ name. Edwards knew that the loan applications falsely inflated his income and assets, and that by signing the settlement documents he was facilitating a fraud.
Eventually the loans on the Columbia property went into default. To forestall foreclosure, the co-conspirator sent a $12,082.90 cashiers’ check to the mortgage company in June 2008. In June 2010, to encourage the bank to accept a “short sale” that would have caused an immediate loss to the bank of $625,000, Edwards signed a letter, drafted by another co-conspirator, which falsely represented that Edwards had fallen behind on the mortgage payments due to a medical disability that had occurred after he obtained the loans. In fact, Edwards was unemployed and receiving disability payments when he obtained the loans.
The Maryland Mortgage Fraud Task Force was established to unify the agencies that regulate and investigate mortgage fraud and promote the early detection, identification, prevention and prosecution of mortgage fraud schemes. This case, as well as other cases brought by members of the Task Force, demonstrates the commitment of law enforcement agencies to protect consumers from fraud and promote the integrity of the credit markets. Information about mortgage fraud prosecutions is available www.justice.gov/usao/md/Mortgage-Fraud/index.html.
This law enforcement action is part of President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.
United States Attorney Rod J. Rosenstein praised the special agents of the FBI, the Federal Housing Finance Agency Office of Inspector General and the Howard County Police Department, for their work in this investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Gregory R. Bockin and Sujit Raman, who are prosecuting the case.
Fort Washington Business Owner Sentenced for Falling to Pay TaxesRead the Press Release
Ordered to Pay Restitution of $143,815 to the IRSBaltimore, Maryland - U.S. District Judge George L. Russell III sentenced Kevinton Reynolds, age 47, of Fort Washington, Maryland, today to six months of home detention as part of 18 months’ probation for failing to file tax returns. Judge Russell ordered Reynolds to pay restitution of $143,815 to the IRS and to perform 1,000 hours of community service.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Thomas J. Kelly of the Internal Revenue Service - Criminal Investigation, Washington, D.C. Field Office.
“Failure to comply with your tax obligations violates U.S. tax law,” said Thomas J. Kelly, Special Agent in Charge IRS Criminal Investigation, Washington DC Field Office. “The law is crystal clear: people must file and pay their taxes. Today's sentence brought an abrupt end to Mr. Reynolds’ criminal behavior and is a reminder that IRS Criminal Investigation is committed to maintaining the integrity of our tax system.”
According to his guilty plea, Reynolds owned and operated K&R Construction, LLC. Prior to 2007, Reynolds reported income earned by K&R Construction, and its predecessor business, on his personal tax returns. In 2007, Reynolds earned $247,045 in income based on K&R Construction’s gross receipts of approximately $1,110,683. In 2008, Reynolds earned $163,084 in income based on K&R Construction’s gross receipts of approximately $384,227.
Reynolds willfully failed to file any income tax returns for tax years 2007 and 2008; and failed to pay $86,617 in tax due for 2007, and $57,198 in tax due for 2008.
The total tax loss to the government for 2007 and 2008 is at least $143,815.
United States Attorney Rod J. Rosenstein commended the IRS – Criminal Investigation for its work in the investigation and thanked Assistant United States Attorney Sujit Raman and Special Assistant United States Attorney Gregory P. Bailey, who prosecuted the case.
Former Postal Service Employee Sentenced to Prison for Making False Statements to Obtain Federal Disability BenefitsRead the Press Release
Operated A Salon and Fitness Center While Claiming to Be DisabledGreenbelt, Maryland - Chief U.S. District Judge Deborah K. Chasanow sentenced Darlene M. Altvater, age 48, of Mechanicsville, Maryland, late yesterday to five months in prison, followed by five months home detention and three years of supervised release, for two counts of making false statements to obtain federal disability benefits. Chief Judge Chasanow also ordered Altvater to pay restitution, with the exact amount still to be determined.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Paul Bowman of the U.S. Postal Service, Office of Inspector General; and Special Agent in Charge Michael S. Barcus, U.S. Department of Labor – Office of Inspector General, Office of Labor Racketeering and Fraud Investigations
According to the evidence presented at her five day trial, Darlene Altvater was employed by the U.S. Postal Service as a rural carrier at the Mechanicsville Post Office in St. Mary’s County, Maryland. After an on-the-job injury to her head and neck, Altvater began receiving federal workers’ compensation benefits in 2001. The evidence showed that from January 2005 through December 2011, while she continued to receive worker’s compensation benefits based on her disability, Altvater operated a salon, day spa and fitness center, first in Leonardown, Maryland and later in California, Maryland, under the names LadySlender LLC, Creative Touch Salon and Spa, and California Fitness LLC.
Although Altvater filed forms with the USPS and the U.S. Department of Labor, Office of Workers’ Compensation Programs claiming that she was unable to work due to her disability, witnesses testified that Altvater reported to the salon on a regular basis, performing physical acts, including demonstrating the use of the fitness equipment, performing pedicures and giving massages.
United States Attorney Rod J. Rosenstein praised the U.S. Postal Service, Office of Inspector General and U.S. Department of Labor – Office of Inspector General, Office of Labor Racketeering and Fraud Investigations for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Hollis R. Weisman and Special Assistant U.S. Attorney Ann O’Brien, assigned from the Department of Justice’s Antitrust Division, who prosecuted the case.
Bank Vice President Sentenced to 18 Months in Prison for Embezzling over $600,000Read the Press Release
Obtained 20 Fraudulent Loans by Forging Signatures of Bank Officials and Concealed the Loans by Manipulating Bank RecordsBaltimore, Maryland - U.S. District Judge Ellen L. Hollander sentenced Wanda Henderson, age 56, of Westover, Maryland, today to 18 months in prison, followed by five years of supervised release, for embezzlement by a bank employee. Judge Hollander also ordered Henderson to pay restitution of $456,665.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation.
According to Henderson’s plea agreement, she was the Vice-President and Executive Assistant to the President of Hebron Savings Bank and had access to the Bank’s vault, the computer system and the Bank’s loan files.
Beginning in approximately 2005, and continuing until April, 2011, Henderson embezzled money from the bank by creating fraudulent loan applications and fraudulent loan and line of credit accounts at the bank in her name and in the names of family members. Henderson forged the signatures of various bank officials, including the President, as the approving loan officer on the applications. Henderson also forged the initials of other bank employees on paperwork that authorized the transfer of the loan proceeds into Henderson’s personal checking account or the checking account of a family member.
Henderson concealed the fraudulent loans from bank officials by manipulating and changing data in the bank records. In particular, Henderson altered the origination dates for the fraudulent loans so that they did not appear on the monthly New Loan Reports and removed the fraudulent loans from the bank’s quarterly Large Borrowers’ Reports.
As the loans became due, Henderson obtained new fraudulent loans by again creating accounts in the bank computer system and forging approval signatures of other bank officials. By using the proceeds from the new loans to pay off the previous loans, Henderson was able to continue the scheme until April 2011.
Henderson obtained 20 fraudulent loans for herself or for members of her family by forging signatures and manipulating bank records. The total unpaid principal balance on the fraudulent loans is $682,236.77 and of that amount, over $456,000 has gone into default.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
United States Attorney Rod J. Rosenstein thanked the FBI for its work in the investigation. Mr. Rosenstein praised Assistant U.S. Attorney Kathleen O. Gavin, who prosecuted the case.
Two Indicted on Charges Related to the Manufacture and Transfer of Fraudulent Identification DocumentsRead the Press Release
Baltimore, Maryland - A federal grand jury has indicted Antonio Abraham Cruz-Cruz, age 26, a Mexican citizen residing in Adelphi, Maryland; and Henry Ramos Agustin, age 37, a Guatemalan citizen residing in Cambridge, Maryland, on charges relating to the sale and transfer of fraudulent identification documents. The superseding indictment was returned on March 20, 2013, and unsealed today upon the arrest of the defendants. In addition to making the arrests, Special Agents of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations executed six search warrants were today at locations connected to the defendants.
The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge William Winter of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI).
“Document fraud poses a threat to national security and puts the security of our communities at risk because it creates a vulnerability that may enable terrorists, criminals and illegal aliens to gain entry to and remain in the United States,” said HSI Baltimore Special Agent in Charge William Winter. “This investigation resulted in the arrest and indictment of an alleged document mill leader and co-conspirator operating out of Maryland. Homeland Security Investigations will move aggressively to investigate and bring to justice those who potentially compromise the integrity of America's legal immigration system.”
The 13-count indictment alleges that from October 17, 2012 through February 19, 2013, Cruz-Cruz and Agustin conspired to manufacture and transfer fraudulent identification documents. According to the indictment, Cruz-Cruz manufactured documents, including permanent resident cards and social security cards, which he sold to customers, and which he provided to Agustin for sale to customers. The indictment alleges that the defendants solicited and took orders for false identification documents from customers who provided the defendants with photographs and personal information. Agustin allegedly provided the photographs and personal information to Cruz-Cruz, who manufactured the requested fake documents, which he then delivered to Agustin in exchange for a portion of the sales price. The indictment alleges that Cruz-Cruz sold such manufactured fake documents to his own customers as well.
The defendants face a maximum sentence of 15 years in prison for the conspiracy and for each count of transfer of false identification documents; 10 years in prison for each count of fraud and misuse of immigration documents; five years in prison for each count of social security number fraud; and a mandatory two years in prison, consecutive to any other sentence, for aggravated identity theft. An initial appearance and arraignment was held today in U.S. District Court in Baltimore. Cruz-Cruz and Agustin are detained pending trial.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
United States Attorney Rod J. Rosenstein praised HSI Baltimore and HSI Resident Agent in Charge Ocean City for their work in the investigation and thanked the Anne Arundel County Police Department and Baltimore County Police Department for their assistance in executing today’s search warrants. Mr. Rosenstein thanked Assistant United States Attorney Tamera L. Fine, who is prosecuting the case.
Previously Convicted Sex Offender Sentenced to over 12 Years in Prison for Interstate Travel to Engage in Sex with A MinorRead the Press Release
Baltimore, Maryland – U.S. District Judge Catherine C. Blake sentenced Scott Odham, age 49, of Laurel, Delaware, today to 150 months in prison, followed by lifetime supervised release, for traveling across state lines to engage in sex with a minor. Odham is a previously convicted sex offender, including a 2001 conviction in Carroll County for child abuse and indecent exposure. Judge Blake ordered that upon his release from prison, Odham must register as a sex offender in the place where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA).
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge William Winter of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Colonel Marcus L. Brown, Superintendent of the Maryland State Police; Colonel Nathaniel McQueen, Jr. of the Delaware State Police; and Somerset County State’s Attorney Dan Powell.
According to Odham’s plea agreement, from 2010 through April 2011, Odham sent repeated and frequent Facebook and MySpace messages, some of which were sexually explicit, to over 50 high school and middle school females that lived in the Western Maryland area. On April 16, 2011, Odham became Facebook “friends” with AS, a 19 year old female from Princess Anne, Maryland. The two decided to meet and began a sexual relationship. On April 22, 2011, a 14 year old middle school girl went to visit AS during her spring break and stayed at AS’s home. That night, AS and the minor female drank alcohol together and sent pictures of themselves in bathing suits by telephone to Odham. The next day, AS left the 14 year old female alone while she attended a family event in Delaware. Odham knew that the girl was in the home alone and he traveled from his home in Delaware, to the Princess Anne home where he engaged in sexually explicit conduct with the 14 year old.
On June 1, 2011, Odham sent an inappropriate text message to the 14 year old, who was in school at the time. The message was seen by her science teacher and subsequently by her principal, who reported the contact to police. The 14 year old was interviewed by authorities and described Odham’s visit to the Princess Anne home. The victim stated that Odham offered to pay her to take off her clothes and asked her to watch porn with him. When the victim declined his advances, Odham grabbed her by the hair and demanded oral sex. A state search warrant for Odham’s home and an arrest warrant for Odham were subsequently obtained and executed. Numerous pornographic pictures were found on Odham’s phone, including photos of Odham’s penis and sexually explicit photographs of AS and the 14 year old victim.
Odham previously pleaded guilty to state charges of escape and to perverted practices stemming from a video he made, and entered an Alford plea to third degree sex abuse. He was sentenced to 20 years in prison, with 10 years suspended. Following his conviction, Odham was sent to the Western Correctional Institution in Hagerstown, Maryland. From jail, Odham sent threatening letters to the Maryland State Trooper who investigated his case and to the minor female.
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 "resources" tab on the left of the page.
United States Attorney Rod J. Rosenstein commended the HSI Baltimore, the Maryland State Police, Delaware State Police and Somerset County State’s Attorney‘s Office for their work in the investigation and prosecution. Mr. Rosenstein thanked Assistant U.S. Attorney Sandra Wilkinson, who prosecuted the case.
Caroline County Man Pleads Guilty to Stealing Property from the Goddard Space Flight CenterRead the Press Release
Stole Tools and Scaffolding Which He Sold at Pawn Shops in Baltimore, Anne Arundel and Queen Anne’s CountiesGreenbelt, Maryland – Brandon Scott Gauss, age 28, of Preston, Maryland pleaded guilty late yesterday to theft of government property from the Goddard Space Flight Center, part of the National Aeronautics and Space Administration (NASA).
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Inspector General Paul K. Martin, NASA Office of Inspector General.
According to his plea agreement, Gauss was a contract employee at NASA. As an engineering technician at the Goddard Space Flight Center, he had access to tools and other property NASA owned. From October 2011 through November 2012, Gauss stole tools and aluminum scaffolding belonging to the government, which he sold to pawn shops for cash. Gauss made over 60 visits to pawn shops throughout Maryland, including Baltimore, Anne Arundel and Queen Anne Counties, and received at least $16,974. The government has recovered some of the items, worth at least $29,736. Gauss admits that he owes the government at least $11,574.35, the money he received from selling the stolen materials the government has been unable to recover.
As part of his plea agreement, Gauss will be required to pay restitution of $11,574.35 to the U.S. government; $4,461 to Fast Cash Pawn Shop in Annapolis, Maryland; and to forfeit at least $29,412.89.
Gauss faces a maximum sentence of 10 years in prison. U.S. District Judge Paul W. Grimm has scheduled sentencing for July 2, 2013 at 9:30 a.m.
United States Attorney Rod J. Rosenstein praised the NASA OIG, Office of Investigations for its work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Leah J. Bressack and Sujit Raman, who are prosecuting the case.