Eastern District of Michigan
Press releases recorded for this federal judicial district.
Husband and Wife Plead Guilty to False Statement to an Agency of the United States, Tax Evasion, and Bankruptcy FraudRead the Press Release
DETROIT - A Dearborn, Michigan husband and wife were arraigned yesterday on charges of false statement to an agency of the United States, tax evasion, and bankruptcy fraud, U.S. Attorney Dawn N. Ison announced today. On the same day, both individuals pleaded guilty before Judge Laurie J. Michelson.
Ison was joined in the announcement by Sarah Kull, Special Agent in Charge of the Internal Revenue Service Criminal Investigation Division, Joshua Hauxhurst, Acting Special Agent in Charge of the Federal Bureau of Investigation, and U.S. Department of Agriculture, Office of Inspector General, Acting Special Agent-in-Charge Salvador Gonzalez.
Abraham Elsaghir, 52, pleaded guilty to one count of false statement to an agency of the United States, one count of federal income tax evasion, and one count of bankruptcy fraud. Samar Elsaghir, 51, pleaded guilty to one count of false statement to an agency of the United States and one count of federal income tax evasion.
According to the information and the plea agreements, in May 2017, Abraham and Samar Elsaghir filed a voluntary Chapter 7 petition in bankruptcy, and they received a discharge of their debts in August 2017. As the plea agreement acknowledges, however, the Elsaghirs made false declarations in their bankruptcy petition, by both failing to report and underreporting their income. During the same time period, the Elsaghirs made similar false statements to both the I.R.S. on their 2016 tax return and to the U.S. Department of Agriculture in order to receive Supplemental Nutritional Assistance Program (SNAP) benefits, commonly known as food stamps. In the plea agreements, the Elsaghirs agreed that, from 2014-2020, they had received nearly $60,000 in SNAP benefits they were not entitled to receive, and that they, in fact, owed the I.R.S. an additional $70,000 for tax calendar years 2014-2018. Abraham Elsaghir also agreed he owed and to pay over $166,000 to unsecured creditors in the bankruptcy case.
“We have seen an unprecedented number of people commit fraud on government programs. This case involved multiples layers of deception – lying to the bankruptcy court, the I.R.S., and the U.S.D.A. This conduct will not be tolerated, and individuals who make false statements to exploit resources intended for those most in need will be vigorously investigated and prosecuted.”
“Working with our law enforcement counterparts and the U.S. Attorney’s Office to pursue and prosecute individuals who repeatedly make false statements to government agencies helps ensure the integrity of government processes,” said Josh Hauxhurst, Acting Special Agent in Charge of the FBI’s Detroit Division. “This investigation sends the message that those who lie to federal investigators and commit fraud in the process will be held accountable.”
“The Elsaghir’s plea serves as an important reminder that Federal income tax compliance should be equally shared among all Americans,” said Special Agent in Charge Sarah Kull, IRS Criminal Investigation, Detroit Field Office. Conspiring to defraud the government with a scheme to underreport taxable income and to steal money meant for low income families is unlawful and shameful.”
U.S. Department of Agriculture, Office of Inspector General, Acting Special Agent-in-Charge Salvador Gonzalez said, “The Supplemental Nutrition Assistance Program (SNAP) was created to provide food and nutrition to those who truly need this assistance. Those who are involved in fraud and abuse of SNAP and other USDA programs will be aggressively pursued by our office. Our joint investigation in this investigation helps brings to justice individuals who sought to profit from the SNAP program through illegal schemes. The USDA Office of Inspector General will continue to dedicate resources and work with our local law enforcement partners in order to protect the integrity of this and other USDA programs and to pursue prosecution of those who commit fraud.”
Sentencing of both Abraham Elsaghir and Samar Elsaghir has been set for June 23, 2022, before Judge Laurie J. Michelson in the Eastern District of Michigan. Each defendant faces a maximum penalty of 5 years in prison. Judge Michelson will determine each sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The investigation of this case was jointly conducted by Special Agents of the Federal Bureau of Investigation, the Internal Revenue Service Criminal Investigation, and the United States Department of Agriculture Office of Inspector General – Investigations, and prosecuted by Assistant U.S. Attorney Patrick E. Corbett and Special Assistant U.S. Attorney Richard A. Roble.
Detroit Man Sentenced on Charges of Carjacking and Firearms OffensesRead the Press Release
DETROIT - A Detroit man was sentenced today to 145 months in federal prison after having pleaded guilty to charges of carjacking and brandishing a firearm during and in relation to a crime of violence, announced United States Attorney Dawn Ison.
Ison was joined in the announcement by Acting Special Agent in Charge Josh Hauxhurst, Federal Bureau of Investigation, Detroit Division.
Ivan Xavier Armstrong, 38, was sentenced before US District Judge Stephen J. Murphy in Detroit.
“Violent offenders like Mr. Armstrong are our focus,” stated US Attorney Ison. “We are committed to bringing the full weight of the justice system to bear on individuals who are making our neighborhoods unsafe and who prey upon our citizens.”
"Mr. Armstrong's case is the latest in a series of joint investigations that have seen defendants sentenced to significant federal prison sentences," said Acting Special in Charge Josh Hauxhurst of the FBI's Detroit Division. "We are committed to working alongside the Detroit Police Department to curb these violent offenses and to bring a sense of safety to our communities."
According to court records, during the early morning hours of April 3, 2020, Armstrong went on a two-hour violent crime spree that included kicking in the front door of his mother’s house located on the eastside of Detroit, preventing her from leaving the home, damaging her phone and firing shots at her house. Armstrong then left the area on foot and approached a man sitting in his car. Armstrong tapped the window with his gun and ordered the victim to get out the car. Armstrong then racked the gun at which time the victim exited his vehicle. The victim was then robbed of his wallet which contained his retired police officer credentials.
Additional facts presented to the court established that at approximately 5:04 am, Detroit Police responded to a call for shots fired at a gas station, located at 14820 East Jefferson Avenue in the city of Detroit. The shooter was gone at the time of their arrival, however a review of high-definition video taken by numerous cameras installed at the gas station revealed that Armstrong arrived at the gas station in the Hyundai Sonata he had carjacked from the retired police officer. The video from the gas station shows a physical fight ensued and that Armstrong fired a handgun at people inside the store. No one was injured. Later that morning, Armstrong was arrested after having broken into a residence on Alter Rd, in Detroit.
This case was investigated by agents of the FBI and was prosecuted by Assistant United States Attorneys Jeanine Brunson and Caitlin Casey.
Grosse Pointe Park Man Sentenced for Scheme to Defraud and Steal Funds from Religious CharityRead the Press Release
DETROIT - A Grosse Pointe Park resident was sentenced today to one year in prison and six months at a halfway house on wire fraud charges in connection with obtaining by fraud, embezzling, and stealing the funds of the Holy Cross organization, a large charitable organization based in Clinton, Michigan, that receives federal funds, announced United States Attorney Dawn N. Ison.
Joining in the announcement was Acting Special Agent in Charge Joshua Hauxhurst, Federal Bureau of Investigation, Detroit Division.
Sentenced was John R. Lynch, 57. In sentencing Lynch, United States District Judge Bernard A. Friedman also ordered Lynch to serve three years of supervised release and pay restitution in the amount of $247,867.75.
According to court records, in March 2012 Lynch became the CFO of the Holy Cross organization, and in January 2015 he became its CEO. Holy Cross was established in 1948 when Boysville of Michigan was incorporated under the auspices of the Roman Catholic Archdiocese of Detroit. Boysville of Michigan later became Holy Cross Children’s Services, which is now known as Holy Cross Services. The Holy Cross organization provides welfare services to disadvantaged children and adolescents, behavioral health services to adolescents and adults, and a number of support services to the homeless. Holy Cross services are provided mostly to individuals in Southeast and Mid-Michigan. The Holy Cross organization also includes the Samaritan Center, a large community resource center that provides healthcare, employment services, and other forms of support to residents of Detroit’s east side.
At the time of his plea, Lynch admitted that when he was Holy Cross’s CEO, he used Holy Cross funds to pay for repairs to his own cars, install a new roof on his house, pay down his personal mortgage balance, and make payments on a personal American Express account. Lynch also used Holy Cross funds to pay his own consulting company, JKL Consulting, and to pay another company hired to provide security services at the Samaritan Center, First Nation Security, a company ostensibly controlled by a relative but actually controlled by him. Lynch attempted to justify some of these payments with bogus invoices. In addition, Lynch used his corporate Holy Cross American Express card to pay for goods and services of a personal nature, such as lodging at resorts, dining at restaurants, travel, and purchases at apparel and department stores.
Altogether, Lynch embezzled approximately $248,000 of Holy Cross’s funds. Moreover, apart from that, he violated Holy Cross’s conflict-of-interest policy by steering Holy Cross business to companies that he and/or close relatives controlled.
Holy Cross received federal funds under the National School Lunch Program and the School Breakfast Program. It also received federal funds under Title IV-E of the Social Security Act, which pays for foster care and provides adoption assistance and guardianship assistance.
The case was prosecuted by Assistant United States Attorney Stephen Hiyama. The investigation was conducted by the Federal Bureau of Investigation.
Former Macomb County Prosecutor Eric Smith Sentenced to Prison for Obstruction of JusticeRead the Press Release
DETROIT - Former Macomb County Prosecutor Eric Smith, 53, of Macomb Township, was sentenced today to 21 months in federal prison after having pleaded guilty to obstruction of justice, announced United States Attorney Dawn Ison.
Ison was joined in the announcement by Acting Special Agent in Charge Joshua Hauxhurst, Federal Bureau of Investigation, Detroit Division.
Smith pleaded guilty on January 27, 2021, before United States District Judge Linda V. Parker, to obstructing justice by attempting to get a friend and two of his assistant county prosecutors to make false statements to federal law enforcement officers and a federal grand jury in a federal criminal investigation of Smith’s own criminal conduct.
Smith’s obstruction of justice related to an investigation by the Federal Bureau of Investigation that revealed that between 2012 and 2020, Smith conducted two fraud schemes to steal approximately $75,000 in cash from his political campaign fund to use for personal expenses. When he became aware of a federal grand jury investigation in 2019, Smith pressured three witnesses to lie and commit perjury on his behalf to federal authorities and a federal grand jury.
Smith admitted that he had stolen over $74,000 from his campaign fund through two different fraud schemes. In one scheme, Smith falsely claimed that he was using campaign funds to pay rent on office space for his re-election efforts. In truth, however, Smith never used the office space, but instead wrote dozens of fraudulent checks to a friend worth over $50,000. The friend then kicked back cash from all of the cashed checks to Smith to use for his personal expenses. In a second fraud scheme, Smith wrote a check for $20,000 from the campaign fund to an assistant Macomb County prosecutor, ostensibly for “consulting” work on the campaign. However, the assistant prosecutor then cashed the check and surreptitiously provided $15,000 in cash to Smith for Smith’s personal expenses.
Smith has agreed to forfeit the $69,950 in fraud proceeds that he personally received from his scheme to steal from his campaign account.
US Attorney Ison stated, “Today, Former Macomb County Prosecutor Eric Smith was sentenced to prison for violating his oath of office and betraying the trust that the Macomb County voters placed in him. Smith used his position to steal money, and then used his authority to ask witnesses to lie to federal investigators and to a federal grand jury. As an elected prosecutor, his conduct strikes at the very core of our justice system. Today’s sentence proves that our justice system works and that no one, not even a county’s chief law enforcement officer is above the law.”
“Eric Smith began his career by taking an oath to uphold the law. Sadly, Smith ended that career by encouraging others to break the law,” said Josh Hauxhurst, Acting Special in Charge of the FBI’s Detroit Field Office. “Today’s sentence is proof that his attempt to shield himself from the consequences of his criminal activities failed because of the determination of FBI and the US Attorney’s Office to hold accountable public officials who engage in criminal and corrupt behavior.”
The investigation of this case was conducted by the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorney Robert Moran.
A Southfield Woman Has Been Charged with Unemployment Insurance Benefit Fraud Related to the COVID-19 PandemicRead the Press Release
DETROIT – A Southfield, Michigan woman was charged in a criminal complaint for allegedly making false and fraudulent unemployment insurance (UI) claims filed in relation to the COVID-19 pandemic, announced United States Attorney Dawn N. Ison.
Joining in this announcement were Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General, Special Agent in Charge John Marengo, United States Secret Service’s Detroit Field Office and Julia Dale, Director, Michigan Unemployment Insurance Agency.
Katrina Patreese Maddox, 46, is charged with mail fraud, wire fraud and aggravated identity theft. Maddox was arrested today and will be appearing in federal court in Detroit this afternoon.
The complaint alleges that from May 2020 through December 2021, Maddox used the identities of other people to file over 35 fraudulent unemployment insurance claims and that illegally obtained benefits cards were used, among other things, to make court payments and DoorDash deliveries for Maddox as well as cash withdrawals. Approximately $311,440 in benefits was paid out as a result of the scheme, and the potential loss to the government was over $1.2 million.
A complaint is only a charge and is not evidence of guilt. Trial cannot be held on felony charges in a complaint. When the investigations are completed, determinations will be made whether to seek felony indictments.
This case is being investigated by agents of the Department of Labor, Office of Inspector General with the assistance of the Michigan Unemployment Insurance Agency. The case is being prosecuted by Assistant United States Attorneys Mark Chasteen and Sarah Youngblood.
Federal Inmate Pleads Guilty to Murder of Fellow InmateRead the Press Release
DETROIT - A federal inmate at Milan Correctional Institution in Milan, Michigan, has pleaded guilty to Second Degree Murder in the death of a fellow inmate, announced United States Attorney Dawn N. Ison.
Ison was joined in the announcement by Josh Hauxhurst, Acting Special Agent in Charge of the Detroit Field Office of the Federal Bureau of Investigation, and Jonathan Hemingway, Warden, Milan Correction Facility.
Adam Taylor Wright, 41, a former resident of Springfield, Illinois, pleaded guilty today before United States District Court Judge Paul D. Borman.
According to court records, on January 2, 2019, Wright, along with co-defendants Alex Albert Castro, 41, and Jason Dale Kechego, 40, unlawfully killed fellow inmate Christian Maire. Specifically, Wright and Kechego repeatedly kicked and stomped Maire in the head, and Wright prevented Maire from fleeing while Castro repeatedly stabbed Maire. Wright, along with his two co-defendants, then worked together to throw Maire’s body down a flight of metal stairs.
The plea agreement calls for a sentence over 27 years that can be imposed concurrently, partially concurrently, or consecutively to the sentences of imprisonment (totaling 199 months) he is already serving on three other cases.
Charges are still pending against Castro and Kechego. They are presumed innocent until and unless proven guilty beyond a reasonable doubt.
“When a murder happens within a prison, it undermines the safety and security of our penal institutions as well as the inmates and Bureau of Prisons employees who work there,” said U.S. Attorney Ison. “Our office will bring to justice those who engage in such senseless and brutal acts of violence.”
This case was investigated by special agents of the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Frances Lee Carlson and Andrew R. Picek.
Thirteen Individuals Charged in Drug and Money Laundering ConspiraciesRead the Press Release
Thirteen Individuals Charged In Drug and Money Laundering Conspiracies
DETROIT - United States Attorney Dawn N. Ison announced that an indictment was unsealed today charging 13 individuals with drug and money laundering crimes. The drug crime is for conspiracy to possess with intent to distribute controlled substances, namely Fentanyl including counterfeit Fentanyl pills, cocaine and cocaine base, methamphetamine and marijuana. The money laundering crime is for money laundering conspiracy, namely engaging in monetary transactions to launder drug proceeds.
Ison was joined in the announcement by Special Agent in Charge Kent Kleinschmidt, Drug Enforcement Administration, Detroit Division.
Named in the federal indictment were:
- CESAR MATIA GARCIA, a.k.a. “Cee,” - 27 of Phoenix, Arizona; Indicted for both drug and money laundering conspiracies,
- KYLE ALLAN KENNARD, a.k.a. “Whopp Dogg,” a.k.a. “Dogg,” a.k.a., “Whopp,” – 36 of Detroit, Michigan; Indicted for both drug and money laundering conspiracies,
- LEO BRADLEY TODD, a.k.a. “LWay,” a.k.a. “Sway,” – 32 of Detroit, Michigan; Indicted for both drug and money laundering conspiracies,
- CORDERALLA PIERA CAMPBELL, a.k.a. “Chi,” a.k.a. “Teezy,” – 33 of Detroit, Michigan; Indicted for both drug and money laundering conspiracies,
- PERISE JAAMAR SMITH, a.k.a. “P,” - 32 of Detroit, Michigan; Indicted for drug conspiracy,
- JALIN DEANDRE GARDNER, a.k.a. “Styles,” a.k.a. “Stizie,” 28 of Detroit, Michigan; Indicted for drug conspiracy,
- MARCOS ANTONIO MONARREZ, - 22 of Phoenix, Arizona; Indicted for drug conspiracy,
- ISMAEL RODRIGUEZ, - 19 of Phoenix, Arizona; Indicted for drug conspiracy,
- KAPRI FATIMA OLDHAM, - 24 of Detroit, Michigan; Indicted for both drug and money laundering conspiracies,
- RAMIKA SHANEE BOAZE, - 29 of Phoenix, Arizona; Indicted for drug conspiracy
- BRIANNA TESHARRI BLAKE, - 24 of Detroit, Michigan; Indicted for money laundering conspiracy,
- DARRION LANAE WASHINGTON, a.k.a. “Hannah,” - 27 of Detroit, Michigan; Indicted for money laundering conspiracy,
- CATEASHA LATREASE WELLS-IVY, of Detroit, Michigan – 35 of Detroit, Michigan; Indicted for money laundering conspiracy.
Of the thirteen defendants, 9 have been arrested in Detroit and will be appearing in federal court this afternoon for their arraignment. Two defendants have been arrested in Arizona and will be appearing in federal court for their removal proceedings this afternoon.
"With these arrests, a major fentanyl distribution organization has been dismantled,” stated US Attorney Ison. “I’d like to thank the entire law enforcement team that worked so hard on this case. This case demonstrates cooperation and teamwork at its best.”
“Today’s arrests are the result of an aggressive strategy to target those who allegedly profit off the distribution of counterfeit pills laced with deadly amounts of fentanyl. DEA will continue to investigate those responsible for distributing illegal drugs throughout our communities in an effort to save lives,” said Acting Special Agent in Charge Kent Kleinschmidt
The indictment alleges that since at least February of 2019, the majority of defendants conspired to possess with the intent to distribute cocaine and cocaine base, Fentanyl, methamphetamine and marijuana. The indictment alleges that over 500 grams of cocaine, Fentanyl and methamphetamine were involved in the conspiracy. In addition, several defendants have been charged with money laundering, which in this case is engaging in monetary transactions to launder drug proceeds.
In conjunction with the unsealing of the indictment, DEA special agents, along with agents and officers from other federal, state, and local law enforcement agencies, executed numerous search warrants at various locations throughout Michigan and Phoenix, Arizona.
The charges in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
This investigation was conducted by special agents of the DEA, Detroit Division, Phoenix Division, Louisville Division (Lexington Office), and law enforcement officials from Michigan State Police, Kentucky State Police, Wayne County Airport Police Department, US Marshals Service, US Border Patrol, White Lake Police Department.
The case is being prosecuted by Assistant U.S. Attorneys David Portelli and Alyse Wu.
U.S. Attorney’s Office Resolves ADA Investigation of Ascension Providence Hospital and Related Medical FacilityRead the Press Release
DETROIT, MI.— The U.S. Attorney’s Office for the Eastern District of Michigan has resolved its investigation into allegations that Ascension Providence Hospital and an Ascension-affiliated medical facility, Washington Primary Care, violated the Americans with Disabilities Act (ADA) by denying patients with disabilities from bringing their service animals into their facilities, U.S. Attorney Dawn N. Ison announced today.
The agreement resolves two complaints received by the U.S. Attorney’s Office. The first alleged that Ascension Providence Hospital refused to allow a service dog to accompany a patient with a disability into the pre- and post-operative areas of the hospital. The second alleged that a doctor at Washington Primary Care refused to allow a patient to bring her service dog into an examination room, demanded to see “paperwork” for the animals, and told the patient that she would not continue treatment if she insisted on bringing her service animal. At all times, both Ascension entities cooperated with the investigation, which was conducted by the U.S. Attorney’s Office’s Civil Rights Unit.
Under the resolution, Ascension agreed to revise its service animal policy and its non-discrimination policy applicable to all Ascension Michigan entities, and train its relevant staff on the new policies, including the need to conduct an individualized assessment before any service animal is excluded or prohibited from any area of an Ascension Providence Hospital or Washington Primary Care facility.
“The ADA protects the right of individuals who use a service animal for their disability to have their animal with them in virtually all areas, even in hospitals and medical offices. There is no requirement that they provide any documentation for entry and a person should never be denied health services simply because they use a service animal,” said Dawn N. Ison, United States Attorney for the Eastern District of Michigan. “We are pleased that Ascension shares the United States’ commitment to ensuring the people with disabilities are able to fully access all needed medical care.”
The ADA prohibits discrimination against individuals with disabilities by hospitals and other health care providers. Among other things, the ADA requires doctors, hospitals, and other health care providers to make reasonable modifications in their policies, practices, or procedures when necessary to accommodate people with disabilities, including allowing service animals into their facilities. Enforcing the ADA is a top priority of the Civil Rights Unit of the U.S. Attorney’s Office for the Eastern District of Michigan. Those interested in finding out more about the obligations of hospitals and other health providers under the ADA may call the Department of Justice’s toll-free ADA information line at 800-514-0301 or 800-514-0383(TDD), or access the ADA website at www.ada.gov. ADA complaints within the Eastern District of Michigan can be made to the U.S. Attorney’s Office Civil Rights Hotline at (313) 226- 9151 or [email protected].
Bay City Vascular Surgeon Pleads Guilty in Connection with Defrauding Medicare, Medicaid, and Blue Cross Blue Shield of $19.5 MillionRead the Press Release
BAY CITY - A vascular surgeon from Bay City, Michigan pleaded guilty today to participating in a scheme to defraud Medicare, Medicaid, and Blue Cross/Blue Shield out of approximately $19.5 million, announced United States Attorney Dawn N. Ison.
Ison was joined in the announcement by Acting Special Agent in Charge Joshua Hauxhurst of the FBI’s Detroit Division and Special Agent in Charge Mario Pinto of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Chicago Regional Office.
Pleading guilty was Dr. Vasso Godiali, 59.
According to the plea agreement, Godiali began knowingly defrauding the three medical insurers in approximately 2009 and did so by causing the submission of false billing to all three insurers. As evidenced in the plea agreement, Godiali’s false and fraudulent billing includes admissions related to claims for the placement of stents in dialysis patients and for the treatment of arterial blood clots. Godiali admitted that he billed for the placement of multiple stents in the same vessel, and prepared medical records purporting to document the medical necessity justifying that billing. In fact, Godiali did not place those stents, and he admitted to billing the insurers for services never rendered while preparing materially inaccurate medical records to justify the fraudulent billing. With respect to arterial blood clots, the plea agreement documents a similar pattern of misconduct. Godiali acknowledged that his medical records would describe encountering occluded arteries that would appear to justify the performance of arterial thrombectomies. In fact, as Godiali admitted that he often encountered no such occlusions, performed no such thrombectomies, and thus billed insurers for services never rendered while preparing false medical records to justify the fraudulent claims.
“The scale of Dr. Godiali’s fraud is stunning and his willingness to illegally enrich himself at the expense of our district’s taxpayers and policyholders is egregious.” said U.S. Attorney Ison. “Brazen schemes like this have no place in our district, and today’s guilty plea reflects my office’s commitment to holding medical providers accountable when they abuse society’s trust by engaging in such misconduct.”
“When Dr. Godiali submitted claims for medical services that were never provided, he violated the trust of his patients and defrauded taxpayer-funded health care programs,” said Special Agent in Charge Mario M. Pinto. "HHS-OIG agents will continue to work with our law enforcement partners to identify and investigate medical providers who prey on beneficiaries and steal from federal health care programs."
“Today’s guilty plea should send a clear message to all health care providers that health care fraud is a federal crime that carries serious consequences and will not be tolerated,” said Josh P. Hauxhurst, Acting Special Agent in Charge of the FBI in Michigan. “In partnership with federal, state, and private sector partners, the FBI will work diligently to identify these fraud schemes and hold parties who execute them accountable.”
Sentencing is set for September 15, 2022. Godiali faces up to ten years’ imprisonment and the forfeiture of $19.5 million. Under the terms of the plea agreement, Godiali will be required to pay $19.5 in restitution to Medicare, Medicaid, and Blue Cross Blue Shield of Michigan. A civil forfeiture case against approximately $39.9 million seized from accounts controlled by Godiali remains pending.
The case was investigated by Special Agents of the HHS and FBI, with cooperation and assistance from the Michigan Attorney General’s Office, Michigan Department of Health and Human Services - Office of Inspector General.
The case is being prosecuted by Assistant U.S. Attorneys John K. Neal, Philip A. Ross, and Craig F. Wininger with assistance from the Michigan Attorney General’s Health Care Fraud Division.
Former Store Owner Sentenced to 42 Months in Federal PrisonRead the Press Release
FLINT - Sohyl Halloun, former owner of Shorthorn Meats in Flint, Michigan, was sentenced today to 42 months in federal prison and ordered to pay more than $4,400,000 in restitution for conspiring to commit wire fraud, U.S. Attorney Dawn N. Ison announced today.
Ison was joined in the announcement by Salvador Gonzalez, Acting Special Agent in Charge of USDA-Office of Inspector General and Special Agent in Charge Sara Kull, Internal Revenue Service, Criminal Investigation.
U.S. District Judge Linda V. Parker sentenced Halloun to 42 months in federal prison. Halloun was also ordered to pay $4,424,692 in restitution to the USDA-Food and Nutrition Service.
According to court records, Halloun and other co-conspirators agreed to and provided Supplemental Nutritional Assistance Program (SNAP) users approximately 50 cents on the dollar in exchange for their food stamp benefits. Halloun or his employees either directly provided money to food stamp recipients in exchange for their benefits, or engaged in another scheme that involved other co-conspirators and a local car wash. The total loss resulting from the conspiracy was $4,424,692. The investigation also revealed other troubling aspects of the business. Agents discovered large amounts of expired food at the business when executing a search warrant at Shorthorn Meats. One of Halloun’s co-defendants admitted in a court filing that Halloun directed him to pour bleach water on a rotting chicken so that it could be sold. Halloun fled to Israel during the investigation and required extradition to force his return.
“SNAP uses federal tax dollars to help low-income individuals put food on their tables,” said US Attorney Ison. “This defendant’s actions not only stole from taxpayers but also diverted necessary assistance from those who truly need and benefit from this food assistance program. We hope this sentence will deter other store owners from engaging in this illegal conduct.”
“This investigation and prosecution should send a strong zero-tolerance message to those individuals engaged in the practice of defrauding taxpayer funded WIC and SNAP programs,” said Salvador Gonzalez, Acting Special Agent-in-Charge, USDA-Office of Inspector General. “It should also serve as a warning to all stores, that participate in the WIC and SNAP programs as vendors, that fraud and trafficking (purchasing those benefits for cash) will be vigorously investigated and prosecuted by the USDA-OIG, the U.S. Attorney's Office, and all its federal, state, and local partners that have a stake in ensuring that fraud is eliminated from taxpayer funded programs.”
The case was investigated by special agents from the United States Department of Agriculture-Office of Inspector General and the Internal Revenue Service, Criminal Investigation Division, with the assistance of the Genesee County Sheriff’s Department and the Michigan Department of Human Services. The case was prosecuted by Assistant United States Attorney Christopher Rawsthorne.
District Judge Enters Order Approving Historic Change to the Uaw Constitution and System of Electing OfficersRead the Press Release
DETROIT – United States District Judge David M. Lawson approved the results of the referendum of the membership of the International United Auto Workers union and ordered the union to make a historic change to its constitution to provide for the direct election of the UAW’s officers, sometimes referred to as “one member, one vote,” pursuant to the process required under the Consent Decree between the United States and the UAW, United States Attorney Dawn N. Ison announced today.
Joining in the announcement were Irene Lindow, Special Agent in Charge of the U.S. Department of Labor – Office of Inspector General, Josh P. Hauxhurst, Acting Special Agent in Charge of the Detroit, Michigan office of the Federal Bureau of Investigation, and Sarah Kull, Special Agent in Charge of the Detroit, Michigan office of the Internal Revenue Service – Criminal Investigations, and Thomas Murray, District Director, U.S. Department of Labor – Office of Labor-Management Standards (“OLMS”).
Judge Lawson ordered the UAW to implement the change to its constitution and election system by June 30, 2022, which will be in time for the next election cycle for the UAW’s President and other members of the UAW’s International Executive Board. The UAW’s independent and Court-Appointed Monitor, Neil Barofsky, will design the new election system after consulting with the UAW.
The Consent Decree between the UAW and the United States had required that the union conduct the referendum, under the oversight of the independent Monitor and OLMS. Through the referendum, the UAW’s active and retired members were able to vote whether the union would adopt a direct election system for choosing International officers and Executive Board members. The Consent Decree required that the referendum take place by November 29, 2021. Once voting was closed, the vendor selected by the UAW Monitor began tabulating the votes. On December 2, 2021, the Monitor announced the final vote count: 89,615 members (or 63.7% of voters) in favor of the direct election system and 50,971 members (or 36.3% of voters) in favor of the current delegate system. With the Court’s order, the direct election system will now replace the UAW’s prior delegate-based system, which had been in place for decades. There was a total of 140,586 votes. The vote was conducted by secret, mail-in ballots. On January 19, 2022, OLMS endorsed the vote by the UAW membership finding that the referendum had complied with the Consent Decree and with federal labor law governing the conduct of union elections.
As outlined in the Consent Decree, the UAW must now amend its constitution to require the direct election system. At the same time, the UAW Monitor, in consultation with the UAW, will design the new election rules and procedures for the UAW under the direct election system. The new election system will be in place for the UAW’s next election cycle which will take place in 2022, starting at the UAW’s convention in July 2022.
The Consent Decree came about after the United States filed a civil lawsuit in December 2020 against the International UAW under the Anti-Fraud Injunction Act based on the criminal investigation of the UAW, FCA US LLC, and FCA’s executives. Subsequently, the United States and the International UAW entered into a Consent Decree to settle the lawsuit that was approved by the U.S. District Court. The Court appointed attorney Neil Barofsky to serve as the Independent Monitor of the UAW for the next six years. The Monitor is tasked with providing federal oversight of the UAW concerning fraud, corruption, and misconduct within the UAW.
U.S. Attorney Ison commended the hard work on the referendum of Monitor Barofsky, his staff, and the Office of Labor-Management Standards.
“We designed the Consent Decree so that the members of the UAW would be able to decide for themselves how they would choose their leaders going forward, rather than having the government impose one system or another,” said United States Attorney Dawn Ison. “Now that the members have spoken and chosen a system of direct elections, we will continue to work with the Monitor to ensure that the UAW is fully reformed, free of corruption and fraud, and that the union’s elections will be fair and in compliance with the will of the membership.”
“Today’s decision is an affirmation of our efforts with our law enforcement partners and the U.S. Department of Labor’s Office of Labor-Management Standards to pursue union-affiliated corruption investigations,” said Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General.
"The UAW membership has voted for a significant change in how its leadership is selected, consisting of a system of direct elections. The FBI will continue to work alongside our law enforcement partners, the Monitor, and the UAW to ensure future elections, and the UAW as a whole, remain free from corrupt influence,” stated Acting Special Agent in Charge Hauxhurst.
“This Consent Decree gives power to the hard-working UAW members and is a step towards building trust in future UWA leadership, said Special Agent in Charge Sarah Kull, IRS-Criminal Investigation, Detroit Field Office.”
“With the completion of the UAW Referendum Election, the membership has overwhelmingly spoken, saying that they want a direct voice in deciding who will be the officers of the UAW International Union going forward,” stated Thomas Murray, District Director, U.S. Department of Labor, Office of Labor-Management Standards. “I commend the Monitor and his staff for working closely with OLMS to efficiently conduct the Referendum Election in accordance with the law. We will continue to work with the U.S. Attorney’s Office, our fellow law enforcement partners, and the Monitor to ensure that the UAW continues to represent its members in accordance with the law.”
The case is being prosecuted by Assistant U.S. Attorneys David A. Gardey and Steven Cares.
Area Doctor, Patient Recruiter Charged in a $17 Million Illegal Opioid Distribution ConspiracyRead the Press Release
DETROIT - An indictment was unsealed today charging a physician and a patient recruiter with conspiracy to illegally distribute prescription drugs, and other opioid-related charges, U.S. Attorney Dawn Ison announced today.
Ison was joined in the announcement by Special Agent in Charge Keith Martin, Drug Enforcement Administration, Detroit Field Division.
Charged in the indictment are John Kirkpatrick, 83 of Birmingham, MI and Roland Williams (age) of Detroit, MI.
The Indictment alleges from May 2018 through March 2021, Dr. John Kirkpatrick conspired with Roland Williams and others to issue a significant number of prescription opioids outside the scope of medical practice to recruited “patients” who did not have a legitimate medical need for the drugs. Dr. Kirkpatrick operated Southfield Medical Services in Southfield, MI. Dr. Kirkpatrick only accepted cash at his clinic, and utilized the clinic to prescribe oxycodone and oxymorphone, two of the most addictive and diverted opioids that have a significant street value.
As alleged in the indictment, Dr. Kirkpatrick required each “patient” to have certain records in a patient file before he would write a controlled substance prescription. Roland Williams and others created fraudulent medical records, including MRI reports and Michigan Automated Prescription System (MAPS) reports, to give the appearance of legitimacy.
As further alleged in the indictment, Dr. Kirkpatrick authorized electronic prescriptions for Schedule II controlled substances, which were issued under Dr. Kirkpatrick’s DEA license and without a medical evaluation by him. During the conspiracy, Dr. Kirkpatrick prescribed more than 574,604 dosage units of Schedule II controlled substances, with a conservative street value of more than 17 million dollars.
The case was investigated by the Drug Enforcement Administration. It is being prosecuted by Assistant United States Attorneys Alison A. Furtaw and Brandy R. McMillion. The Eastern District of Michigan is one of the twelve districts included in the Opioid Fraud Abuse and Detection Unit, a Department of Justice initiative created by Attorney General Sessions, that uses data to target and prosecute individuals that are contributing to the nation’s opioid crisis.
An indictment is only a charge and is not evidence of guilt. Each defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Highland Park Police Detective Pleads Guilty to Conspiring to Distribute Fentanyl-laced HeroinRead the Press Release
DETROIT - A Detective with the Highland Park Police Department and her co-conspirator pleaded guilty to conspiring to distribute fentanyl-laced heroin, United States Attorney Dawn N. Ison announced today.
Ison was joined in the announcement by Acting Special Agent in Charge Josh P. Hauxhurst, Federal Bureau of Investigation, Detroit Division.
Tiffany Lipkovitch, 46, of Detroit, and Amber Bellamy, 38, of Detroit, pleaded guilty to conspiring to distribute controlled substances. Lipkovich is a detective with the Highland Park Police Department, where she has been a police officer since 2011. According to the complaint, federal agents recorded numerous calls and meetings between Lipkovitch and a confidential source about a drug transaction. Lipkovich gave the source “samples” or “pictures” of the drugs that were available from her associate, Bellamy, explaining that one was “$80 a gram” and the others were $100 per gram. When Lipkovitch asked what they were diluting or “cuttin” the drugs with, the confidential source responded that people used “fentanyl.” This did not surprise Lipkovitch, who explained that Bellamy was getting “a package of fentanyl . . . from overseas.” Lipkovitch eventually introduced the confidential source to Bellamy, who sold the source 45 grams of a fentanyl / heroin mixture. The confidential source later met with Lipkovitch, who was on duty and in her police uniform, about the transaction, and gave her $300 for facilitating the drug deal.
“Drug trafficking and drug addiction have created a crisis in our communities, something our law enforcement partners know all too well,” said U.S. Attorney Ison. “It is an affront to the good men and women in law enforcement and to the communities that they serve for a sworn law enforcement officer to betray her oath in this manner. “
"Instead of upholding her oath to protect and serve, this police officer endangered the community by conspiring to distribute a dangerous and deadly drug," said Josh P. Hauxhurst, Acting Special Agent in Charge of the FBI's Detroit Division. "The FBI will work with the local and federal partners to protect the community from those who seek to harm it. The FBI appreciates the Highland Park Police Department for their cooperation in this investigation."
Lipkovitch and Bellamy both face a maximum of forty years in prison for the charge to which they pled guilty.
The case was investigated by the FBI Detroit Area Public Corruption Task Force, in collaboration with the Drug Enforcement Administration. The case is being prosecuted by Assistant U.S. Attorney Steven Cares.
Podiatrist Pleas Guilty in Sex for Drugs Diversion SchemeRead the Press Release
DETROIT - A local podiatrist entered a guilty plea today to a two count Information charging unlawfully distribution of controlled substances for his involvement in a sex-for-drugs diversion scheme, announced United States Attorney Dawn N. Ison.
Ison was joined in the announcement by Acting Special Agent in Charge Kent Kleinschmidt , U.S. Drug Enforcement Administration, Detroit Field Division, Acting Special Agent in Charge James C. Harris, Homeland Security Investigations, Detroit Division, and Mario M. Pinto, Special Agent in Charge of the Chicago Region of the U.S. Department of Health and Human Services Office of Inspector General.
Dr. Maninder Deswal, 44, of Lansing, was charged with unlawfully prescribing Oxycodone-Acetaminophen (Percocet) and Hydrocodone-Acetaminophen (Norco), highly addictive opioids, to various women outside the course of professional medical practice. From December 2018 to September 2020, Dr. Deswal would issue controlled substance prescriptions to women in exchange for cash payments, sexual favors, and/or other illicit drugs. These women were not patients and issuing them prescriptions was not for legitimate medical purposes, but rather personal consumption and further drug diversion.
A sentencing date has been set for May 24, 2022 at 3:30 pm before United States District Judge Judith Levy.
This case is being prosecuted by Assistant United States Attorney Brandy R. McMillion. McMillion serves as the District’s Opioid Fraud Abuse and Detection Prosecutor as well as the Deputy-Chief of the Health Care Fraud Unit. The Opioid Fraud Abuse and Detection Unit is a Department of Justice initiative designating twelve special prosecutors across the country to focus on prosecuting medical professionals that are contributing to the nation’s opioid crisis.
The case was investigated by special agents and diversion investigators with the Homeland Security Investigations, the Drug Enforcement Administration and Health and Human Services Office of Inspector General along with assistance from the Ypsilanti Police Department and Washtenaw County Sheriff’s Office.
Father and Son Sentenced on Sex Trafficking ChargesRead the Press Release
DETROIT – Two Detroit men have been sentenced after having pleaded guilty to charges of conspiracy to engage in sex trafficking using force and coercion, as well as firearm and controlled substance offenses, announced United States Attorney Dawn N. Ison.
Ison was joined in the announcement by Acting Special Agent in Charge Josh P. Hauxhurst, Federal Bureau of Investigation, Detroit Division.
Eligah Goodmon, 68, was sentenced today by United States District Judge Laurie Michelson to 111 months in federal prison. Erskin Bernard Perryman, 49, was sentenced in March 2021 to 180 months in federal prison. The sentencings were delayed due to the COVID-19 pandemic. Both Goodmon and Perryman have been in custody since their arrest in February 2020.
According to court records, Eligah Goodmon and his son, Erskin Perryman, ran a drug and prostitution house on Hazelwood in Detroit, Michigan. Goodmon lived in the house on Hazelwood, while Perryman came to the house every day to provide crack cocaine and heroin to the drug-addicted women who lived there. The women in the home purchased drugs from Perryman by performing commercial sex dates. If the women in the home did not comply with Perryman’s demands, he was violent with them. Goodmon collected money from commercial sex dates, provided the women with drugs, and monitored their drug usage.
“These defendants treated their victims like a commodity,” stated U.S. Attorney Ison. “They targeted vulnerable women and exploited them for their own profit and fueled their drug addictions by providing them with drugs. We hope that today’s sentence offers these victims a sense of justice and closure and sends the message that we will not tolerate sex trafficking in our communities. “
“These defendants exploited their victims in the worst way. By plying their victims with drugs, forcing them to engage in commercial sex, and subjecting them to violence if they refused, the defendants took away the freedom and dignity to which these women are entitled,” said Josh P. Hauxhurst, Acting Special Agent in Charge of the FBI’s Detroit Field Office. “The FBI remains committed to working on behalf of victims across the state to hold traffickers responsible for their crimes."
The case was investigated by special agents of the FBI and was prosecuted by Assistant United States Attorneys Sara D. Woodward and Lisandra Fernandez-Silber.
Pharmacy Owner Sentenced for Role in $9 Million Scheme to Bill Insurance for Medications Not DispensedRead the Press Release
DETROIT - A licensed pharmacist from Dearborn Heights was sentenced to 77 months for his role in a scheme to defraud health care insurers by submitting claims for pharmaceuticals that were not actually purchased, announced United States Attorney Dawn N. Ison.
Ison was joined in the announcement by Acting Special Agent in Charge Josh Hauxhurst of the FBI’s Detroit Division and Mario M. Pinto, Special Agent in Charge of the Chicago Region of the U.S. Department of Health and Human Services Office of Inspector General.
Sentenced was Mohamad Ali Makki, 46. In sentencing Makki, United States District Judge Linda V. Parker ordered Makki to pay $9.8 million in restitution. Further, the court ordered the forfeiture of approximately $1.1 in funds seized from bank accounts controlled by Makki.
According to court records, from 2013 through 2019, Makki was a licensed pharmacist at Life Care Pharmacy in Farmington Hills. Makki, along with his co-conspirators Wansa Makki and Hossam Tanana, participated in a scheme to defraud Medicare, Medicaid and Blue Cross Blue Shield of Michigan by submitting claims for pharmaceuticals which Life Care Pharmacy did not actually purchase. Makki and his co-conspirators submitted claims for expensive pharmaceuticals such as Abilify, Seroquel, and Epipen 2-pak Injections. As part of the scheme and, in an effort to conceal the fraud from auditors, Makki created false invoices so that he could falsely claim to the auditors that LifeCare had, in fact, purchased the pharmaceuticals. In doing so, Makki and his co-conspirators caused more than $9.8 million in loss by obtaining reimbursements for the pharmaceuticals they never actually purchased.
“Fraud by health care professionals will be aggressively pursued by our office,” said US Attorney Ison. “We hope that prosecutions like this one will deter health care professionals from stealing money from those who genuinely need it to order to line their own pockets.”
“Healthcare fraud impacts the cost and availability of healthcare resources for every American,” said Acting Special Agent in Charge Josh P. Hauxhurst of the FBI’s Detroit Field Office. “We encourage the public to help us identify, investigate, and prosecute this crime. If you suspect healthcare fraud, report it to the FBI at [email protected], 1-800-CALL-FBI, or contact your health insurance provider.”
“When pharmacists and other medical professionals enrich themselves by submitting fraudulent claims to Federal health care programs, they undermine the trust and confidence that beneficiaries and patients place in their hands,” said Special Agent in Charge Mario M. Pinto. “Our agency will continue to hold medical professionals accountable, while protecting the programs intended for those that depend on them for life saving medication and critical services.”
Co-defendant Hossam Tanana, 57, pleading guilty to money laundering proceeds obtained from the scheme in November 2021. He is awaiting sentencing. The remaining co-defendants, Wansa Makki, and Mahmoud Makki, are awaiting trial.
The case was investigated by Special Agents of the HHS and FBI, with cooperation and assistance from the Michigan Department of Health and Human Services - Office of Inspector General. The case is being prosecuted by Assistant U.S. Attorney Philip A. Ross.
Harrison Man Sentenced to 40 Years in Prison for Sexual Offenses Against MinorsRead the Press Release
BAY CITY – A Harrison man was sentenced to 480 months (40 years) in federal prison after having pleaded guilty to charges of sexual exploitation of children and for engaging in the sexual exploitation of children while required to register as a sex offender, announced United States Attorney Dawn Ison.
Ison was joined in the announcement by Josh P. Hauxhurst, Acting Special Agent in Charge, Federal Bureau of Investigation, Detroit Division.
Sentenced before United States District Court Judge Thomas L. Ludington was Nathanial Alexander Tessner, 29.
According to court records, Tessner met the 14-year-old victim online and caused her to create sexually explicit images as well as meeting her in person and having sexual contact with her. Tessner also caused the victim to create sexually explicit images of herself with a dog and coerced her to create sexually explicit images of a 3-year-old child. Tessner committed those offenses while he was required to register as a sex offender under federal or other law.
“The actions of this defendant are truly reprehensible,” said US Attorney Ison. “Today’s sentence sends a clear message that we will prosecute individuals who prey on our most vulnerable – our children- to the maximum extent allowed by law. “
“This case demonstrates the commitment of the FBI and our law enforcement partners to protect the children in our communities from recidivist sex offenders like Mr. Tessner,” said Acting Special Agent in Charge Josh P. Hauxhurst of the FBI’s Detroit Field Office. “These are serious crimes that inflict great harm on some of the most vulnerable members of our society and the serious consequences imposed on this defendant are an important signal to would-be offenders that they will be found and brought to justice.”
The case was investigated by the Southeast Michigan Trafficking and Exploitation Crimes Task Force (“SEMTEC”) of the Federal Bureau of Investigation. The case was prosecuted by Assistant United States Attorney Christopher Rawsthorne.
Canton Man Sentenced to 228 Months for Sexual Exploitation of ChildrenRead the Press Release
DETROIT – A Canton man was sentenced to 228 months in prison on charges of sexual exploitation of a minor, announced United States Attorney Dawn Ison.
Ison was joined in the announcement by Josh P. Hauxhurst, Acting Special Agent in Charge, Federal Bureau of Investigation, Detroit Division.
Sentenced was Shailesh Patel, 54. In sentencing Patel, United States District Court Judge George Steeh also ordered Patel to pay a $50,000 fine.
According to court records, Patel admitted that in approximately 2010, on at least one occasion, he gave a 10-year-old female his cellular phone and told her to make a video that produced a visual depiction constituting child pornography. The victim estimated that this occurred on approximately 30 occasions. Patel abused this victim, and others, for years, beginning when she was as young as five and continuing until she was 12. The victim stated that the abuse is a “burden that I will carry for the rest of my life, and so will those people in my life who love me the most, my family and friends.”
US Attorney Dawn N. Ison stated, “The victim in this case demonstrated great courage coming forward with her story, stopping Patel’s abuse and likely preventing future victims. The United States Attorney’s Office remains dedicated to the safety of children and holding abusers like Patel responsible for their actions.”
"Creating child sexual abuse material is a serious offense that causes incalculable damage to young victims,” said Josh P. Hauxhurst, Acting Special Agent in Charge of the FBI’s Detroit Division. “Today’s sentence in combination with the sentences he is facing in state court holds Mr. Patel accountable for his conduct and ensures he cannot harm any more children, but it will never make up for the lifetime of painful memories he inflicted on his victims and their families. Cases like this one illustrate the FBI’s commitment to identify, investigate, and hold predators like him accountable.”
Patel has also pleaded guilty in the Third Judicial Circuit Court to 15 to 35 years in prison for a first-degree criminal sexual conduct charge, 9 to 15 years for two second-degree criminal sexual conduct charges, and probation for a fourth-degree criminal sexual conduct charge. The conduct giving rise to these charges involves two minor female victims, one of which is the same victim as the federal case. He is awaiting sentencing on these charges.
The case was the result of a joint investigation by the Canton Police Department and the Southeast Michigan Trafficking and Exploitation Crimes Task Force (“SEMTEC”) of the Federal Bureau of Investigation, as well as a cooperative effort between the Wayne County Prosecutor’s Office and the United States Attorney’s Office.
Detroit City Councilman Andre Spivey Sentenced to Prison for Bribery ConspiracyRead the Press Release
DETROIT - Detroit City Councilman Andre Spivey, 48, of Detroit, was sentenced to 24 months in prison today for conspiring with a member of his staff to commit bribery by accepting over $35,000 in bribe payments in connection with the City Council’s oversight of towing in Detroit, United States Attorney Dawn N. Ison announced today.
According to court records, while serving as an elected member of the Detroit City Council, Andre Spivey accepted $35,900 from an undercover federal law enforcement officer and a confidential source of information for the FBI. On eight separate occasions between February 2018 and February 2020, Spivey, or a member of his staff identified as “Public Official A,” accepted bribe payments amounting to thousands of dollars from the undercover agent or the confidential source, all in connection with towing issues pending before the City Council. For example, on October 26, 2018, Spivey met with the undercover agent and the confidential source at the Side Street Diner in the City of Grosse Pointe, Michigan. During that meeting, Spivey accepted $1,000 in cash from the undercover agent and another $1,000 in cash from the confidential source. The payments were made to Spivey seeking Spivey’s assistance with a proposed towing ordinance pending before the City Council. As another example of the corrupt payments, on February 21, 2020, the confidential source gave $8,000 in cash to Public Official A, and the undercover agent gave Public Official A $4,000 in cash. Public Official A took the money knowing that it was given for the benefit of Spivey and in exchange for Spivey’s assistance with towing issues pending before the City Council.
Spivey served on the Detroit City Council from 2009 until September 2021, when he resigned from office immediately after pleading guilty in this case.
Spivey was the first case charged and first conviction of the government’s investigation of corruption within the government and the Police Department of the City of Detroit relating to the towing industry and other matters. So far, five men have been charged in the investigation, and two have pleaded guilty.
Ison was joined in the announcement by Josh Hauxhurst, Acting Special Agent in Charge of the Michigan Field Office of the Federal Bureau of Investigation.
United States Attorney Ison said, “Public corruption undermines the faith of the people in their leaders. Public officials who take bribes will be punished, and I am determined to take every action to root out corruption within the City of Detroit or anywhere else in this district where we find it.”
It is the mission of the FBI's Public Corruption Task Force to thoroughly investigate the conduct of elected officials who - like Mr. Spivey - abuse their positions of power and the public's trust for their own personal gain," said Josh P. Hauxhurst, Acting Special Agent in Charge of the FBI's Detroit Field Office. "Today's sentencing serves as a warning to all public officials who allow greed to triumph over duty, that federal agents will never cease in their relentless pursuit for justice."
The investigation of this case was conducted by the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorneys David A. Gardey and Frances Carlson.
Southfield Resident Pleads Guilty in COVID-19 Fraud SchemeRead the Press Release
DETROIT - Southfield resident Mykia King pleaded guilty today to wire fraud and aggravated identity theft arising out of a pandemic-related unemployment insurance fraud scheme, announced United States Attorney Dawn N. Ison.
Joining in the announcement were Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General and Special Agent in Charge John Marengo, United States Secret Service’s Detroit Field Office.
Mykia King, 29, pleaded guilty to one count of wire fraud arising out of her submission of 34 fraudulent claims for pandemic unemployment assistance. She also pleaded guilty to one count of aggravated identity theft, which reflected the fact that she used stolen personal identifying information to further her unemployment assistance fraud scheme.
According to the plea agreement, King filed approximately 34 fraudulent UI claims seeking pandemic unemployment assistance (PUA) benefits to which she was not entitled. These fraudulent claims were submitted in the names of multiple individuals without those individuals’ authorization or consent. King submitted adulterated identification documents as proof of identification for her fraudulent PUA claims. Indeed, King submitted identical driver’s license photos and social security cards as proof of identification for multiple claims, although she used different names and addresses for the claims. The funds associated with King’s fraudulent claims were typically loaded onto Bank of America debit cards and mailed to addresses King controlled. King would then withdraw the funds on these cards, usually at ATMs located in the Eastern District of Michigan.
According to the plea documents, one such fraudulent claim was submitted in the name of a victim whose initials were T.R. King filed a fraudulent PUA claim using T.R.’s name and social security number on June 5, 2020. King was not lawfully in possession of T.R.’s social security number, and was not authorized to file a PUA claim on T.R.’s behalf. The claim used King’s street address (with a different apartment number). The system requested an Identity Verification (IDV), and King uploaded an adulterated Michigan driver’s license bearing T.R.’s name as proof of identification. Benefits were paid on King’s fraudulent T.R. claim on approximately June 23 and 24, 2020. King accessed the fraudulently obtained benefits by using a Bank of America debit card issued for the T.R. claim at ATMs in the Detroit Metro area on approximately June 25–30, July 1–2, July 6, and July 10–11, 2020, obtaining approximately $11,880. This fraudulent use of T.R.’s identifying information in furtherance of her fraud scheme gave rise to the aggravated identity theft charge to which King pleaded guilty.
United States Attorney Ison stated “Enhanced benefits for unemployed workers were a key lifeline for many of our district’s citizens during the pandemic. Unfortunately, those enhanced benefits attracted criminals seeking to exploit the system and enrich themselves at the public’s expense. My office has no tolerance for this abuse of a public program, and today’s plea is a reflection of my office’s commitment to vigorous prosecution of these cases.”
“Mykia King submitted numerous fraudulent claims for pandemic unemployment assistance, obtaining more than $366,000 in funds intended for individuals who lost their jobs during the COVID-19 pandemic. We will continue to work with our law enforcement partners to safeguard the UI system from those who exploit these benefit programs,” said Irene Lindow, Special Agent in Charge, Chicago Region, U.S. Department of Labor Office of Inspector General.
Special Agent in Charge Marengo said, “The U.S. Secret Service is dedicated to working with our federal, state and local law enforcement partners in UIA fraud cases. The U.S. Secret Service continues to focus on criminals exploiting the American people.”
Sentencing is set for April 19, 2022 at 11 am. before United States District Judge Linda V. Parker.
The case is being prosecuted by Assistant United States Attorneys John K. Neal and Alyse Wu. The investigation is being conducted jointly by the Department of Labor-Office of Inspector General and the Secret Service. The Michigan Unemployment Insurance Agency provided valuable assistance in this investigation.
Downriver Man Arraigned on Delivery of Methamphetamine Causing DeathRead the Press Release
DETROIT - A 52 year-old Downriver man was arraigned today on charges relating to the overdose death of a 28 year-old woman, announced United States Attorney Dawn N. Ison.
Ison was joined in the announcement by Acting Special Agent Josh Hauxhurst , Federal Bureau of Investigation, Detroit Division.
Scott Christopher Sams was charged by indictment with conspiracy, possession with intent to distribute methamphetamine, and delivery of methamphetamine causing death.
According to filings in the case, Sams has been selling methamphetamine in the Downriver area for at least two years. In May 2021, it is alleged that Sams met the victim at a hotel room in Allen Park, where he gave her a fatal amount of methamphetamine. He is facing up to life in prison.
Law enforcement is currently investigating additional overdose fatalities. Anyone with information regarding Sams is urged to contact FBI at (313)965-2323.
This investigation is being conducted by the FBI as part of the Southeast Michigan Region Organized Crime Drug Enforcement Task Forces (OCDETF) Strike Force and is being prosecuted by Assistant United States Attorney Maggie Smith.
Columbus, Ohio Man Sentenced to 63 Months for Defrauding Employer of over $4 MillionRead the Press Release
David Hudson, 56, of Columbus, Ohio, was sentenced yesterday by Judge Arthur J. Tarnow to sixty-three months in prison for defrauding his employer of over $4 Million, announced United States Attorney Dawn N. Ison.
Hudson was an employee of Cummins Bridgeway, LLC (“CBL”) and Cummins Inc. (“Cummins”), two companies operating in New Hudson, Michigan. Hudson worked for CBL from approximately 2003 through 2014, until it was acquired by Cummins. Post-acquisition, Hudson was employed by Cummins.
The owners of CBL established two entities to which CBL profits were paid for the purpose of sharing profits with CBL management and employees. While working at CBL, Hudson’s job involved transferring funds to these profit-sharing entities in the normal course of business. As part of his job, Hudson had authority to write checks from the profit-sharing entities. As part of the scheme to defraud, Hudson would, under false pretenses, direct an employee under his supervision to transfer CBL funds—and later Cummins funds—into one or more of the profit-sharing entities. Hudson would then, without authorization, write checks from the profit-sharing entities to himself. It was the goal of this scheme that Hudson would take advantage of his authority and position to enrich himself at the expense of his employers.
Between approximately 2008 and 2017, Hudson’s scheme resulted in the fraudulent transfer of over $4.5 million dollars. This money was spent by Hudson to support a lavish lifestyle. For example, Hudson used stolen funds to purchase a Cadillac, designer clothing, luxury watches, cigars, and rare wines.
Ison was joined in the announcement by Josh Hauxhurst, Acting Special Agent in Charge of the Detroit Field Office of the Federal Bureau of Investigation.
This case was investigated by special agents of the Federal Bureau of Investigation and prosecuted by Assistant United States Attorney Timothy Wyse.
Attempted Robbery of over 100 Kilos of MarijuanaRead the Press Release
FLINT - Justin D. Cooper, 30 of Flint was sentenced today to 17 years in federal prison for his participation in the deadly attempted robbery of over 100 kilograms of marijuana from a residence in Sanilac County, announced United States Attorney Dawn N. Ison. Cooper was sentenced by United States District Judge Stephanie Dawkins Davis following his guilty plea in August of 2021.
Ison was joined in the announcement by Acting Special Agent in Charge Josh Hauxhurst of the Federal Bureau of Investigation-Detroit Division (FBI), Paul Rich, Sanilac County Sheriff, Keith LaMont, Michigan State Police, and Brenda Sanford, Sanilac County Prosecuting Attorney.
According to court documents, at various times prior to November 19, 2017, Cooper and his co-conspirators drove to a residence in Sanilac County where they attempted to break into a building on the property in order to steal over 100 kilograms of marijuana, which they later intended to distribute. When those attempts at stealing the marijuana failed, Cooper and his co-conspirators planned to take the marijuana by force by way of an armed robbery.
On or about November 18, 2017, and continuing until November 19, 2017, Cooper and his co-conspirators gathered at a residence in Flint to prepare for the robbery. Some members of the conspiracy armed themselves with firearms to use during the robbery. Cooper and other members of the conspiracy then traveled to a Marathon Gas Station on S. Dort Highway in Flint to obtain gasoline to facilitate their travel to Sanilac County and to purchase items to be used in the robbery. While at the Marathon Gas Station, Cooper purchased two boxes of lawn and leaf bags to be used by members of the conspiracy to carry away the 100 plus kilograms of marijuana they intended to rob. After they left the Marathon Gas Station, Cooper and other members of the conspiracy drove to the residence in Sanilac County. Cooper and his co-conspirators covered their faces and put on gloves while some of the co-conspirators brandished firearms as they approached the front door of the residence. As the group reached the front door, they kicked it in, forcibly entering the residence. Some members of the conspiracy discharged their firearms, exchanging gunfire with one of the residents. One resident was shot in the leg by the intruders. One of the residents shot two of the intruders, killing them both. Cooper and his co-conspirators retreated, fled the scene, and drove off in their vehicles.
“Combatting violent crime is a top priority for the Department of Justice and for our office. This deadly attempted robbery left one resident injured and two of the intruders dead, and our office is pleased that this sentence reflects our commitment to combat violent crime. I commend the efforts of our local and federal law enforcement partners in bringing those involved to justice. The U.S. Attorney’s office will work aggressively to protect the citizens of Sanilac County and across the Eastern District of Michigan”, said U.S. Attorney Ison.
Judge Davis sentenced Cooper to 84 months for conspiracy to possess with intent to distribute 100 kilograms or more of marijuana, followed by a consecutive sentence of 10 years for aiding and abetting the discharge of a firearm during the incident. This resulted in total sentence of 204 months. Davis also sentenced Cooper to a 4-year term of supervised release following his term of incarceration.
Two of Cooper’s co-conspirators, Paul M. Drinkwine and John C. Williams, have also pleaded guilty and are scheduled to be sentenced by Davis in February.
The case was investigated by the Sanilac County Sheriff’s Department, the Michigan State Police, and special agents of the FBI, with assistance from the Sanilac County Prosecutor’s Office. The case was prosecuted by Assistant United States Attorneys Jules DePorre, Ann Nee, and Anthony Vance.
Dawn N. Ison Sworn in as United States AttorneyRead the Press Release
DETROIT - Dawn N. Ison was sworn in as the United States Attorney for the Eastern District of Michigan by Chief United States District Judge Denise Page Hood.
Ison, who most recently served in the U.S. Attorney’s Office’s Public Corruption Unit, will lead one of the largest U.S. Attorney’s Offices in the country. The office currently employs approximately 221 personnel in three locations (Detroit, Flint and Bay City) and serves more than 6.5 million residents.
“It has been a privilege to serve as an Assistant United States Attorney for over 19 years. I could not be more honored to extend my service to my hometown in this significant way as the United States Attorney, which serves as the pinnacle of my career. We will continue to work hard to ensure the protection and safety of every citizen in this district and make sure the people of this richly diverse community feel valued.”
President Joseph Biden nominated Ison on November 12, 2021, and she was confirmed by the Senate on December 14, 2021. Ison succeeds Saima S. Mohsin who was appointed as the Acting U.S. Attorney in January.
Since 2002, Ison has served as an Assistant United States Attorney for the Eastern District of Michigan, where she has prosecuted drug trafficking offenses at the highest level in the Office’s Drug Task Force Unit. She also served as Chief of that unit, which is the largest unit in the U.S. Attorney’s Office. Since 2014, Ison has served as the Office’s District Election Officer, and also represented the Office in the federal court’s alternative to prison program. Early in her career, Ison spent twelve years as a criminal defense attorney.
Over the course of her career, Ison has successfully handled large-scale, complex, multi-defendant prosecutions. Ison’s work has been nationally recognized on several occasions by the Department of Justice and more recently by the U.S. Department of Homeland Security. She has also received U.S. Attorney’s Awards for Outstanding Service and for Superior Performance by a Litigation Team. During her career, Ison has taken more than 50 cases to trial both as a prosecutor and a defense attorney.
After law school, Ison served as a Prehearing Attorney for the Michigan Court of Appeals. She graduated from Spelman College in 1986 and received her law degree from Wayne State University Law School in 1989.
Former Detroit Police Detective Charged with BriberyRead the Press Release
DETROIT - A federal criminal complaint was unsealed today charging a former Detroit Police Department detective with bribery Acting United States Attorney Saima S. Mohsin announced. The charges were brought against Michael Pacteles, 44, of Southgate, who resigned from the Detroit Police Department (DPD) in 2020 and who is currently an officer with the Hamtramck Police Department.
Mohsin was joined in the announcement by Timothy Waters, Special Agent in Charge of the Detroit Field Office of the Federal Bureau of Investigation and Detroit Police Chief James E. White.
According to the criminal complaint, while working as a detective with DPD, Pacteles accepted bribes, including a vehicle and $3,200 in cash, from a towing company operator. In return, Pacteles agreed to provide “favors” for the towing company operator. For instance, instead of properly recovering stolen vehicles from the towing company operator’s possession, Pacteles removed them from the DPD database that showed they were stolen. Pacteles also agreed to provide the towing company operator with information about vehicles from the Michigan Law Enforcement Information Network (or LEIN), a restricted law enforcement database.
The bribery charge carries a maximum sentence of 10 years’ imprisonment and a fine of $250,000.
This is the fifth defendant charged as part of the government’s investigation known as “Operation Northern Hook.” Northern Hook is an investigation of corruption within the government and the Police Department of the City of Detroit relating to the towing industry and other matters.
Acting United States Attorney Mohsin said, “The vast majority of police officers are hardworking dedicated public servants. Our office is committed to prosecuting those officers who cast a stain on these officers and who betray the public trust by accepting bribes. Today’s criminal complaint shows our office’s commitment to that goal.”
“The citizens of Detroit deserve a city government that is free of bribes and corruption. These individuals erode the public’s trust in government and in the men and women who serve the city with integrity,” said Timothy Waters, Special Agent in Charge of the FBI in Michigan. “The FBI will continue to prioritize the investigation of government employees who break the law. We encourage the public to report instances of public corruption to the FBI at [email protected].”
Chief White said, “I am disappointed with these allegations but fully supportive of this investigation. I would like to emphasize, that the alleged actions of one former officer does not represent the vast majority of the exceptional men and women of the Detroit Police Department who go above and beyond the call of duty for our community each and every day. We will continue to fully cooperate with our federal partners to ensure that Detroit Police Department employees involved with alleged corruption and misconduct are held accountable for their actions. The Detroit Police Department takes pride in our transparency and aspire to achieve high standards of service and accountability and recognize that these alleged actions fall far short of those goals."
The investigation of this case was conducted by the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorney Steven P. Cares.
A criminal complaint is only a charging document and is not evidence of guilt.
Two Men Sentenced for Their Role in the Attempted Murder of Federal AgentsRead the Press Release
DETROIT - Two men have been sentenced for their role in the Attempted Murder of Federal Agents, announced Acting United States Attorney Saima Mohsin.
Mohsin was joined in the announcement by Keith Krolczyk, Acting Special Agent in Charge of the Detroit Field Office of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF).
Kevin Keshawn Young, a/k/a “Gucci,” 24, of Detroit, was sentenced to 180 months in federal prison and Aaron Marquis Shooks, a/k/a “Boogey,” 23, of Detroit, was sentenced to 151 months in federal prison. Both pleaded guilty to Attempted Murder of Federal Agents before United States District Court Judge Sean F. Cox on August 4, 2021, for their roles in shooting at two ATF agents on April 15, 2019, on Detroit’s east side.
According to court records, Defendant Aaron Shooks and other members/associates of a gang known as the OES 187 Head Hunters (“OES”) were involved in two shootings. The first was a shootout in front of St. John’s Hospital, which was part of an ongoing, violent feud between OES and a gang known as Block Squad. Shortly after, Shooks, who was driving, went to pick up more people. After getting back on the road, one of the passengers—Defendant Kevin Young—got out of the car and fired eleven shots at ATF agents in an unmarked vehicle who were investigating other gang activity. Young claimed he thought he was shooting at rival gang members rather than law enforcement.
“Every day our law enforcement officers put their lives on the line and risk personal injury to protect our citizens from senseless violence,” said Acting United States Attorney Saima Mohsin. “When officers or agents are assaulted while performing those duties, the perpetrators can expect that every resource of this office will be used to prosecute them to the fullest extent of the law, and to seek justice.”
“Our special agents and other law enforcement officers risk their personal safety everyday doing their job, protecting the public and enforcing the law, to make our community safe. We are proud of them and their unrelenting professionalism.” commented ATF Acting Special Agent in Charge Keith Krolczyk Detroit Field Division. “We continue to be thankful to United States Attorney’s office for their partnership in the fight against violent offenders.”
The case was investigated by agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). Assistant United States Attorneys Alyse Wu, Eric Straus and Robert Moran prosecuted the case.
Former Bank Manager Pleads Guilty to Theft of Government Funds and Aggravated Identity TheftRead the Press Release
BAY CITY - A former branch manager of JPMorgan Chase Bank pleaded guilty today to theft of government funds and aggravated identity theft, Acting U.S. Attorney Saima S. Mohsin announced.
Mohsin was joined in the announcement by Acting Resident Agent in Charge Katy Krieg of the Social Security Administration Office of the Inspector General, Office of Investigations, Chicago Field Division, Detroit Sub-Office.
Jeffrey Piecka, 46, of Midland pleaded guilty before U.S. Magistrate Judge Patricia T. Morris.
Piecka pleaded guilty to devising and executing a scheme to steal $169,967.63 in government benefits from the bank account of a deceased individual. In the course of his employment with Chase, Piecka conducted a search of open accounts with little account activity. He found an account that was not being used and suspected that the account owner was deceased. Piecka then made changes to the bank account to create online account access for himself, and he proceeded to withdraw significant sums of money from the account by various means, including by initiating an electronic transfer to himself, negotiating online bill payment checks made payable to himself, and making online payments to credit card companies, a utility company, his apartment complex, and his car lender.
Piecka entered into a plea agreement, under which he agreed to pay full restitution to the Social Security Administration in the amount of $169,967.63. A sentencing date will be set by the court.
This case was investigated by special agents of the Social Security Administration Office of the Inspector General and is being prosecuted by Special Assistant U.S. Attorney Corinne M. Lambert.
Justice Department Awards More Than $17.5 Million to Support Project Safe NeighborhoodsRead the Press Release
WASHINGTON – The Department of Justice announced today that it has awarded more than $17.5 million in grants to support the Project Safe Neighborhoods (PSN) Program. Funding will support efforts across the country to address violent crime, including the gun violence that is often at its core. The Black Family Development, Inc. was awarded $349,184 to administer PSN grant funds in the Eastern District of Michigan.
The Bureau of Justice Assistance (BJA), part of the department’s Office of Justice Programs (OJP), will administer the 88 grant awards, which are being made to designated fiscal agents to support local PSN projects that work in partnership with U.S. Attorneys’ Offices.
“This latest Project Safe Neighborhoods grant is critical to addressing the violent crime threatening cities and towns all across our country,” said Deputy Attorney General Lisa O. Monaco. “Ensuring the safety of all Americans is the highest priority for the Department of Justice, but when it comes to violent crime, there is not a one-size-fits-all solution. We have to work closely with local public safety agencies as well as community organizations to craft individual strategies unique to each community’s needs. Programs like Project Safe Neighborhoods and the funding it provides allow us to do just that.”
“By focusing on Detroit's most prominent hotspots for gun violence, Detroit has the opportunity to greatly improve the quality of life for the residents of Detroit who are most acutely affected by gun violence,” said Acting US Attorney Saima Mohsin. “I’m happy to be able to announce this award as it will provide the funding needed to help reach our goal of reducing gun violence.”
Grant funds support Detroit’s ongoing and proactive efforts to reduce violent crime through highly focused enforcement and prevention strategies. The project leverages the collaborative efforts of strong law enforcement partnerships involving the Detroit Police Department, the Wayne County Prosecutor's Office, the Michigan Department of Corrections, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the U.S. Attorney's Office-Eastern District of Michigan and Research Partner Michigan State University to address the persistently increasing gun violence in targeted areas with the overall goal of reversing this trend. Focused law enforcement initiatives are combined with the Ceasefire Detroit Outreach team and its community partners who conduct targeted outreach in Detroit neighborhoods. These concerted efforts are designed to help end the cycle of violence in the Detroit. With approval from BJA, the Fiscal Agent will begin the process of making subawards for PSN grant projects.
“Investing in our communities, supporting victims and building a justice system that both keeps people safe and earns their trust – these are mutually reinforcing goals that stand at the heart of Project Safe Neighborhoods,” said Principal Deputy Assistant Attorney General Amy L. Solomon for OJP. “The Office of Justice Programs is pleased to join with our U.S. Attorneys’ Offices, and with jurisdictions across the country, as we work together to meet the challenges of crime and violence and achieve our shared aspirations of public safety and community trust.”
In May 2021, Attorney General Merrick B. Garland announced a new effort to reduce violent crime, including the gun violence that is often at its core. Integral to that effort was the reinvigoration of PSN, a two-decade old evidence-based and community-oriented program focused on reducing violent crime. The updated PSN approach, outlined in the department’s Comprehensive Strategy for Reducing Violent Crime issued by Deputy Attorney General Monaco, is guided by four key principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence, setting focused and strategic enforcement priorities and measuring the results of our efforts. The fundamental goal is to reduce violent crime, not simply to increase the number of arrests or prosecutions.
This fall, U.S. Attorney’s Offices across the country have enhanced their violent crime reduction efforts to ensure alignment with the department’s comprehensive violent crime reduction strategy. U.S. Attorneys’ Offices have engaged in outreach to law enforcement and other agencies and organizations serving communities to identify the most significant drivers of violence in their districts. Working together with a broad coalition of stakeholders, the U.S. Attorneys’ Offices are addressing the most pressing violent crime issues in their district to make our neighborhoods safer for all.
PSN programs are led by U.S. Attorneys’ Offices in collaboration with local public safety agencies, community stakeholders and other agencies and organizations that work to reduce violent crime.
For a list of all grantees, please visit: LINK HERE.
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The Office of Justice Programs provides federal leadership, grants, training, technical assistance and other resources to improve the nation’s capacity to prevent and reduce crime, advance racial equity in the administration of justice, assist victims and enhance the rule of law. More information about OJP and its components can be found at www.ojp.gov.
Two Defendants Plead Guilty to Unemployment Fraud SchemeRead the Press Release
DETROIT - Two defendants pleaded guilty today to charges related to unemployment insurance benefit fraud schemes, announced Acting United States Attorney Saima Mohsin.
Joining in the announcement were Special Agent-in-Charge Timothy Waters, Federal Bureau of Investigation; Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General and Julia Dale, Director of the Michigan Unemployment Insurance Agency.
Pleading guilty were Mitchacole Johnson, 45, of Shelby Township, and Larry Witherspoon, 46, of Harper Woods. Both pleaded guilty to charges of wire fraud and will be sentenced before United States District Judge Gershwin Drain on March 22, 2022.
According to court records, Johnson and Witherspoon are responsible for filing at least 66 claims for fraudulent unemployment insurance benefits in at least 4 states, including Michigan. Their illegal activity caused actual losses of over $1.3 million and attempted losses of nearly $3.5 million. Johnson filed a number of claims in her own name, while Witherspoon filed multiple claims in the names of people who had names similar to his own, such as “Lawrence Witherspoon”. Both Johnson and Witherspoon filed their claims using other people’s Social Security Numbers and had the benefits deposited into a variety of bank accounts, some connected to pre-paid debit cards.
These cases are both being prosecuted by Assistant United States Attorney Ryan A. Particka. The investigations are being conducted jointly by agents from the Department of Labor Office of the Inspector General, the Federal Bureau of Investigation and the Michigan Unemployment Insurance Agency.Two Defendants Charged with Unemployment Insurance Benefit Fraud Combined Actual Losses in Excess of $3.2 MillionRead the Press Release
DETROIT - Two defendants have been charged in criminal complaints for their roles in unemployment insurance benefit fraud schemes, announced Acting United States Attorney Saima Mohsin.
Joining in this announcement are Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General, Sarah Kull, Special Agent-in-Charge Internal Revenue Service Detroit and Julia Dale, Director, Michigan Unemployment Insurance Agency.
Tauheed Salik Wilder, 39, of Detroit, MI, and Shuqueni Renee Franklin, 30, of Shelby Township, MI are charged in separate complaints with mail fraud, wire fraud, aggravated identity theft, and money laundering. Wilder and Franklin were arrested today.
Between them, according to the complaints, Wilder and Franklin are responsible for filing at least 470 claims for fraudulent unemployment insurance benefits in at least 5 States, including Michigan. Their illegal activity caused actual losses of over $4 million and attempted losses of over $13 million. It is alleged that both Wilder and Franklin filed numerous false claims using their own names and false social security numbers. Wilder and Franklin also used the stolen identity of other individuals to file false claims for unemployment insurance benefits. Both Wilder and Franklin were caught on bank surveillance cameras using ATM cards in names of individuals whose identity they had stolen to withdraw the illegally obtained unemployment benefits.
“The funds stolen by these defendants were intended to be used to ease the burden of unemployment suffered by residents of Michigan and other States. Those who steal unemployment benefits steal from all taxpayers and jeopardize the safety net Congress enacted to protect employees who lost jobs during the pandemic. These arrests reflect our ongoing commitment to investigating these schemes and bringing the people who commit these crimes to justice,” stated Acting US Attorney Saima M. Mohsin.
"An important part of the mission of the Office of Inspector General is to investigate allegations involving unemployment insurance fraud. We will continue to work with our law enforcement partners to investigate these types of allegations,” stated Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General.
“When someone loses their job, they trust that help will be there to get them through rough times. Thieves jeopardize that trust and threaten the safety net for those truly in need. We won’t let that happen,” said Juila Dale, Director of the Michigan Unemployment Insurance Agency. “Through the tireless work of the Michigan Unemployment Insurance Fraud Task Force, we are bringing these criminals to justice and the Task Force partners should be commended for their efforts. I would also urge anyone who knows of any UI fraud scheme to go to Michigan.gov/UIA and click on the Report Fraud link.”
"Unemployment insurance was designed to provide much needed financial assistance to those in need during a global pandemic. IRS-CI and our law enforcement partners are committed to investigating those who steal government assistance for their personal benefit,” stated Special Agent in Charge Sarah Kull, IRS-CI Detroit Field Office.
A complaint is only a charge and is not evidence of guilt. Trial cannot be held on felony charges in a complaint. When the investigations are completed, determinations will be made whether to seek felony indictments.
Former Treasurer of the Detroit Fire Department Union Pleads Guilty to Stealing over $200,000 in Union FundsRead the Press Release
DETROIT - The former Treasurer of the Detroit Fire Department Union (DFFA) has pleaded guilty to embezzling over $200,000 in union funds, announced Acting United States Attorney SaimaMohsin.
Joining Mohsin in the announcement were Timothy Waters, Special Agent in Charge of the Detroit Field Office of the Federal Bureau of Investigation and Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General.
Verdine Day, age 62, pleaded guilty to bank fraud as charged in an information filed by the U.S. Attorney’s Office. United States District Judge George Caram Steeh accepted her guilty plea and set the matter for sentencing on March 24, 2022 at 2pm..
According to the facts alleged in the information and further developed at the plea hearing, Day was hired by the Detroit Fire Department in 1986. She worked as a firefighter, engineer, and held other positions in the union before she was elected by her peers to Treasurer of the DFFA in November 2015. She was Treasurer from December 2015 until her retirement from the DFFA and the City of Detroit in September 2019.
During the four years Day was Treasurer of the DFFA, she fraudulently obtained approximately $167,900.00 of union funds by (1) issuing checks in her name and then changing the name of the payee in the Union’s Quickbooks software; (2) cashing checks which were voided by her in Quickbooks; (3) writing checks made payable to cash; and (4) withdrawing cash from DFFA bank accounts. Day also fraudulently obtained money by diverting funds intended by the DFFA to be a donation to charity.
Day also used DFFA credit cards as her own personal credit cards while she was Treasurer and after she retired. In total, she charged approximately $49,116.17 in personal expenses using DFFA credit cards. Her purchases on DFFA credit cards included flights, hotel rooms, cruises, car insurance premiums, satellite and cable TV service, national and state parks fees, and furniture. For example, Day used a DFFA union credit card to charge $9,553 for a cruise with Royal Caribbean cruise lines in 2017. Day also used a union credit card to pay for another Royal Caribbean cruise costing $8,975 on the Liberty of the Seas in 2019. She used the union’s credit card to pay her bar bill at a casino in Ohio in May 2019 and for a meal at a Bubba Gump Shrimp Co. restaurant in Cozumel, Mexico in 2019.
Acting U.S. Attorney Saima Mohsin commended the work of the FBI and the Department of Labor in conducting this criminal investigation of a corrupt union officer and said, “This prosecution demonstrates that we will not tolerate union officers who abuse their authority and line their own pockets at the expense of the union’s membership. We will continue to work with our law enforcement partners to root out corruption and fraud involving unions.”
"As treasurer of the Detroit Fire Department Union, Verdine Day had a duty to safeguard the dues paid by men and women who put their lives on the line each day to protect the citizens of Detroit,” said Timothy Waters, Special Agent in Charge of the FBI’s Detroit Field Office. “Today’s guilty plea is an admission she violated her duty and the trust of these brave men and women. The FBI will continue to work with our law enforcement partners to thoroughly investigate anyone who misuses their government position for their own personal benefit.”
“Verdine Day embezzled over $200,000 in union funds in order to personally enrich herself at the expense of dues-paying Detroit Fire Department Union members. We will continue to work with our law enforcement partners to protect the financial integrity of labor organizations,” said Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General.
The case is being prosecuted by Assistant U.S. Attorney Sarah Resnick Cohen. The investigation of this case was conducted by the Federal Bureau of Investigation and the Department of Labor.
Day is facing a maximum of 30 years in prison on the bank fraud charge.
Russian Man Sentenced for Providing ‘Bulletproof Hosting’ for CybercriminalsRead the Press Release
A Russian man was sentenced today for providing “bulletproof hosting” services, which were used by cybercriminals between 2009 to 2015 to distribute malware and attack financial institutions and victims throughout the United States.
On Dec. 1, Chief Judge Denise Page Hood of the U.S. District Court for the Eastern District of Michigan sentenced Aleksandr Grichishkin, 34, of Russia, to 60 months in prison for the scheme.
According to court documents, Grichishkin was a founder and leader of a bulletproof hosting organization that rented internet protocol (IP) addresses, servers, and domains to cybercriminal clients who employed this technical infrastructure to disseminate malware that allowed them to gain access to victims’ computers, form botnets, and steal banking credentials for use in frauds. Malware hosted by the organization included Zeus, SpyEye, Citadel, and the Blackhole Exploit Kit, which attacked U.S. companies and financial institutions between 2009 and 2015 and caused or attempted to cause millions of dollars in losses to U.S. victims.
Grichishkin also helped clients evade detection by law enforcement and continue their crimes uninterrupted by monitoring sites used to blocklist technical infrastructure used for crime, moving “flagged” content to new infrastructure, and registering all such infrastructure under false or stolen identities. On June 28 and Oct. 20, respectively, Chief Judge Hood sentenced two of Grichishkin’s co-conspirators, Pavel Stassi, 30, of Estonia, to 24 months in prison and Aleksandr Skorodumov, 33, of Lithuania, to 48 months in prison for their roles in the scheme.
According to court filings and statements made in connection with the defendants’ guilty pleas, Grichishkin was one of the organization’s founders and proprietors, and its day-to-day leader. In this role, he oversaw efforts to advertise the organization’s bulletproof hosting services in online cybercrime forums, set pricing for these services, negotiated and interfaced with clients seeking internet infrastructure to be used in spamming and malware operations, managed employee hiring and compensation, and supervised the systems administrators’ and other employees’ work. He also regularly instructed other members of the organization on how to “resolve” abuse notices by, among other methods, moving the affected clients’ data to new, “clean” domains and IP addresses.
Stassi, Skorodumov, Grichishkin, and a fourth defendant, Andrei Skvortsov, 34, of Russia, each pleaded guilty to conspiracy to engage in a racketeer influenced corrupt organization. Skvortsov is pending sentencing and faces a maximum penalty of 20 years in prison. A federal district court judge will determine his sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The FBI investigated the case with critical assistance from law enforcement partners in Germany, Estonia, and the United Kingdom.
Senior Counsel Louisa K. Marion of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Patrick E. Corbett of the Eastern District of Michigan prosecuted the case. The Justice Department’s Office of International Affairs provided substantial assistance.
International Hacking Group Members Sentenced for SIM Hijacking Conspiracy That Resulted in the Theft of Millions in CryptocurrencyRead the Press Release
DETROIT - A sixth member of an international hacking group known to its members as “The Community” was sentenced yesterday in connection with a multi-million-dollar Sim Hijacking conspiracy, announced Acting U.S. Attorney Saima Mohsin for the Eastern District of Michigan. This was the final defendant to be sentenced in the case, which was indicted in 2019.
U.S. Attorney Mohsin was joined in the announcement by Acting Special Agent in Charge James C. Harris of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) Detroit who oversees field offices in Michigan and Ohio.
Sentenced before United States District Judge Denise Page Hood was Garrett Endicott, 22, of Warrensburg Missouri. Endicott, who pleaded guilty, was sentenced to 10 months in prison and ordered to pay restitution in the amount of $121,549.37.
“SIM Hijacking” or “SIM Swapping” is an identity theft technique that exploits a common cyber-security weakness—mobile phone numbers. This tactic enabled The Community to gain control of victims’ mobile phone number, resulting in the victims’ phone calls and short message service (SMS) messages being routed to devices controlled by The Community. SIM Hijacking was often facilitated by bribing an employee of a mobile phone provider. Other times, SIM Hijacking was accomplished by a member of The Community contacting a mobile phone provider’s customer service—posing as the victim—and requesting that the victim’s phone number be swapped to a SIM card (and thus a mobile device) controlled by The Community.
Members of The Community engaged in Sim Hijacking to steal cryptocurrency from victims across the country, including California, Missouri, Michigan, Utah, Texas, New York and Illinois. Cryptocurrencies, also known as virtual currencies or digital currencies, are online media of exchange. The most famous of these is Bitcoin. Like traditional currency, they act as a store of value and can be exchanged for goods and services. They can also be exchanged for dollars.
Once “The Community” had control of a victim’s phone number, the phone number was leveraged as a gateway to gain control of online accounts such as a victim’s email, cloud storage, and—ultimately—cryptocurrency exchange accounts. The Community would use their control of victims’ phone numbers to reset passwords on online accounts and/or request two-factor authentication (2FA) codes that allowed them to bypass security measures.
In total, The Community’s scheme resulted the theft of tens of millions of dollars’ worth of cryptocurrency. Individual victims lost cryptocurrency valued, at the time of theft, ranging from under $2,000 to over $5 million. The sentenced defendants were involved in total thefts ranging from approximately $50,000 to over $9 million.
The following defendants have been previously sentenced in the Eastern District of Michigan, all after pleading guilty:
Ricky Handschumacher, 28, of Pasco Country, Florida, was sentenced to 48 months in prison and ordered to pay restitution in the amount of $7,681,570.03.
Colton Jurisic, 22, of Dubuque, Iowa was sentenced to 42 months in prison and ordered to pay restitution in the amount of $9,517,129.29.
Reyad Gafar Abbas, 22, of Charleston, South Carolina, was sentenced to 24 months in prison and ordered to pay restitution in the amount of $310,791.90
Two defendants charged in the indictment were previously sentenced in other courts. Conor Freeman, 22, of Dublin, Ireland, pleaded guilty to parallel charges in Ireland and was sentenced to three years in prison by an Irish court. Ryan Stevenson, 29, of West Haven, Connecticut, pleaded guilty and was sentenced to probation in the District of Connecticut. Both of these defendants were also ordered to pay restitution.
“The actions of these defendants resulted in the loss of millions of dollars to the victims, some of whom lost their entire retirement savings,” said Acting US Attorney Mohsin. “This case should serve as a reminder to all of us to protect our personal and financial information from those who seek to steal it.”
“The illegal activities of The Community were thwarted as the result of a complex international cryptocurrency and identity theft investigation,” said HSI Detroit Acting Special Agent in Charge James C. Harris. “As criminal organizations commonly use web-based schemes to further their illicit activities, this demonstrates how vulnerable our personal information can be, and the damage that can ensue when our information falls into the wrong hands.”
This case was investigated by HSI special agents with the assistance of Irish law enforcement authorities. The case was prosecuted by Assistant U.S. Attorney Timothy Wyse, assisted by Assistant U.S. Attorneys Shankar Ramamurthy and Michael El-Zein as well as attorneys from the Justice Department’s Office of International Affairs and Irish law enforcement officials. Special thanks are due to Assistant U.S. Attorneys and federal agents across the country that provided assistance with arrests and searches conducted on May 9, 2019.
City of Taylor Official Pleads Guilty to Accepting Bribes While Taylor’s Manager of Community Development and Treasurer of Mayor Sollars’ Campaign FundRead the Press Release
DETROIT – The former manager of the City of Taylor’s Community Development and former Treasurer of Mayor Richard Sollars’ campaign fund, pleaded guilty today to conspiring to commit bribery with Richard Sollars, Shady Awad, real estate developer, and Hadir Altoon, real estate developer and owner of Dominick’s Market, Acting United States Attorney Saima S. Mohsin announced today.
Mohsin was joined in the announcement by Timothy Waters, Special Agent in Charge of the Michigan Field Office of the Federal Bureau of Investigation.
Pleading guilty was Jeffrey Baum, 46, of Allen Park.
During his guilty plea hearing, Baum admitted accepting thousands of dollars in cash bribe payments for himself and over $40,000 in cash payments to Sollars in connection with the City of Taylor’s Right of First Refusal (“ROFR”) Program. The ROFR Program is designed to allow Taylor to acquire tax-foreclosed properties from Wayne County for redevelopment. According to court records, between 2017 and 2019, Baum helped Sollars steal money from Sollars’ campaign by giving Sollars blank campaign checks, bearing his signature as the treasurer of the campaign fund, so that Altoon, with Baum’s assistance on occasions, could prepare false and inflated invoices for catering services that were never rendered, were prepared in amounts higher than the actual amount for the catering services provided, and/or were for catering services for which Altoon had already been paid by the City of Taylor.
In furtherance of the fraudulent scheme, Altoon issued the false invoices to Sollars’ campaign fund and completed blank campaign fund checks, provided to Sollars by Baum, in the amounts of the false invoices. Altoon cashed the campaign checks based on the false invoices at his store, Dominick’s Market, and gave Sollars cash and/or scratch-off lottery tickets in same amounts of the checks, totaling over $35,000. It was also part of the conspiracy and in exchange for kickbacks to Baum and Sollars, Baum, without the knowledge of Taylor City Council, but with the knowledge and approval of Sollars, fraudulently facilitated the transfers of tax-foreclosed properties that Taylor had awarded to other developers. Baum transferred to Altoon two of Taylor’s tax-foreclosed properties that that Taylor had originally awarded to another developer and also helped prepare an agreement to transfer nine properties that Taylor had previously awarded to Awad, to Altoon. After Baum provided Altoon a list of nine properties that were eventually transferred and/or intended to be transferred to Altoon by Awad under this agreement, Baum accepted thousands of dollars in cash from Altoon. Over the course of the conspiracy, Baum also accepted hundreds of dollars in cash and gift cards from Altoon. In addition, Baum accepted $5,000 in cash from Altoon for one of Sollars’ campaign fundraising events. Baum also admitted that he accepted $5,000 in cash for a Sollars’ campaign event from another individual interested in doing business with the City. Both times, Baum gave the cash to Sollars and did not include receipt of the funds in Sollars’ campaign finance reports, as required.
In furtherance of the conspiracy, Baum also caused Taylor to dismiss approximately 21 tickets charging civil infractions, ranging between $150 and $200 each, that had been issued by Taylor against Realty Transition and Awad.
The bribery conspiracy count to which Baum pleaded guilty carries a maximum sentence of 5 years of imprisonment. Under the United States Sentencing Guidelines, it is likely that Baum will face a guideline sentencing range of between 46 and 57 months of imprisonment, and a maximum fine of up to $250,000.
Acting United States Attorney Mohsin said, “Citizens in this district deserve public officials who conduct the public’s business with integrity and without improper influence. We will root out and continue to hold accountable those public officials who betray the public’s trust for their own personal benefit or for the benefit of another.”
"The citizens of Taylor deserve a government free of corruption," said Timothy Waters, Special Agent in Charge of the FBI's Detroit Division. "Today's conviction should stand as a warning to any public official that the FBI will aggressively investigate anyone who uses their official position for personal gain."
The investigation of this case was conducted by the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorneys Dawn N. Ison and Frances Carlson.
New Jersey Resident Pleaded Guilty to Interstate Travel with Intent to Engage in a Sexual Act with A Minor ChargesRead the Press Release
BAY CITY – A Manalapan, New Jersey resident pleaded guilty yesterday to interstate travel with intent to engage in a sexual act with a minor, announced Acting United States Attorney Saima Mohsin.
Mohsin was joined in the announcement by James C. Harris, Acting Special Agent in Charge of Homeland Security Investigations field offices in Michigan and Ohio.
Jose Ricardo Gomez, 39, of New Jersey, pleaded guilty on November 17, 2021, to one count of interstate travel with intent to engage in a sexual act with a minor before United States Magistrate Judge Patricia Morris. Gomez will be sentenced in February 2022.
According to court documents, in or about July and August, 2020, Gomez used his phone and the internet to knowingly persuade, induce, entice and coerce a 13-year-old minor and a 14-year-old minor to engage in sexual activity for which he could be charged with criminal sexual conduct in the third degree under Michigan state law. Gomez communicated with the minors via Snapchat and traveled to Michigan from New Jersey. He met them at a hotel in Houghton Lake, Michigan, where he sexually abused the two minors on several occasions during that time. He provided alcohol to the victims before the abuse. Gomez also recorded numerous videos with his iPhone of the 13-year-old minor in various states of undress engaging in sexual acts. For the purpose of persuading the victim to engage in the sexual acts and for the purpose of producing the sexually explicit material, Gomez misrepresented his name, age, and residence. Gomez saved these visual depictions to his Snapchat account’s memories folder. Moreover, between May and August, 2020, Gomez, using Snapchat, distributed multiple videos and photographs depicting minor girls lasciviously exposing their genitalia to other Snapchat users. Gomez also solicited and received from minor girls sexually explicit images of themselves or images lasciviously depicting their genitalia, and distributed some of these images back to the minor girls depicted in those images for the purpose of coercing them to continue to produce and send such images of themselves to Gomez. Gomez threatened to post those images in public forums and to expose them to friends, relatives or classmates of the victims. The day after his arrest, Gomez, using the jail telephone system, directed another unknown individual to destroy and conceal evidence material to this investigation stored in Gomez’s online accounts. Soon thereafter, an unknown individual deleted the images stored in Gomez’s iCloud account.
This case was investigated by agents of the Homeland Security Investigations and Roscommon County Sheriff’s Department and is prosecuted by Assistant United States Attorney Anca Pop.
Justice Department Announces $139 Million for Law Enforcement Hiring to Advance Community PolicingRead the Press Release
The Department of Justice today announced more than $139 million in grant funding through the department’s Office of Community Oriented Policing Services (COPS Office) COPS Hiring Program (CHP). The awards provide direct funding to 183 law enforcement agencies across the nation, allowing those agencies to hire 1,066 additional full-time law enforcement professionals. In the Eastern District of Michigan 2 cities were awarded funding totaling $559,030.
“We are committed to providing police departments with the resources needed to help ensure community safety and build community trust,” said Attorney General Merrick B. Garland. “The grants we are announcing today will enable law enforcement agencies across the country to hire more than 1,000 additional officers to support vitally important community oriented policing programs.”
“I am excited to announce these awards which will provide much needed funding to hire additional police officers in these communities,” said Acting United States Attorney Saima Mohsin. “Protecting the public is our top priority and with crime rates soaring across the nation we are supporting our communities by increasing the capacity of law enforcement agencies to implement community policing strategies that strengthen partnerships for safer communities and enhance law enforcement’s capacity to prevent, solve, and control crime through funding for additional officers.”
The following city/town in the Eastern District of Michigan received awards:
- City of Hamtramck – $434,030
- West Branch - $125,000
CHP is a competitive award program intended to reduce crime and advance public safety through community policing. CHP provides funds directly to law enforcement agencies to hire new or rehire additional career law enforcement officers, thereby increasing their community policing capacity and crime prevention efforts. Of the 183 agencies awarded grants today, approximately half will use the funding to focus on building legitimacy and trust between law enforcement and communities; 41 agencies will seek to address high rates of gun violence; 21 will focus on other areas of violence; and 19 will focus CHP resources on combating hate and domestic extremism or supporting police-based responses to persons in crisis. The complete list of awards can be found here.
Since its creation in 1994, COPS has invested more than $14 billion to advance community policing, including grants awarded to more than 13,000 state, local and Tribal law enforcement agencies to fund the hiring and redeployment of more than 135,000 officers. CHP, COPS’ flagship program, continues to be in demand today: In FY21, COPS received 590 applications requesting nearly 3,000 law enforcement positions. For FY22, President Biden has requested $537 million for CHP, an increase of $300 million.
To learn more about CHP, please visit https://cops.usdoj.gov/chp-award. For additional information about the COPS Office, please visit https://cops.usdoj.gov/.
The COPS Office is the federal component of the Department of Justice responsible for advancing community policing nationwide. The only Department of Justice agency with policing in its name, the COPS Office was established in 1994 and has been the cornerstone of the nation’s crime fighting strategy with grants, a variety of knowledge resource products, and training and technical assistance. Through the years, the COPS Office has become the go-to organization for law enforcement agencies across the country and continues to listen to the field and provide the resources that are needed to reduce crime and build trust between law enforcement and the communities served.
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Au Gres Resident Sentenced to 28 Years in Federal Prison on Production of Child Pornography ChargesRead the Press Release
BAY CITY – An Au Gres resident was sentenced yesterday to 28 years in federal prison on charges of using a minor to produce visual depictions of sexually explicit conduct and ordered to pay $54,500 in restitution to the victims and $5,100 in special assessment, announced Acting United States Attorney Saima Mohsin.
Mohsin was joined in the announcement by Special Agent in Charge Timothy Waters, Federal Bureau of Investigation, Detroit Division.
Sentenced was Christopher Paul Botimer, 59.
Botimer pleaded guilty in December 2020 to one count of using a minor to produce visual depictions of sexually explicit conduct before United States District Judge Thomas Ludington.
On or about October 6, 2017, while in Arenac County, Michigan, Botimer, a computer network engineer, took sexually explicit photographs of a 2-year-old child in his care. In making some of those photographs, Botimer engaged in sexual contact with the victim. He saved the resulting sexually explicit images on several electronic devices. For several years, well before he began to take sexually explicitly photographs of the victim, Botimer searched for child pornography over the Internet. He repeatedly downloaded sexually explicit images of minor children for his sexual gratification. He then either saved or deleted the child pornography from one of the many digital devices available to him at his home. He also made available some of the images to others through a peer-to-peer network.
“Botimer is a child predator and his conduct was reprehensible. Today’s lengthy sentence ensures Botimer will no longer be a threat to young children,” said Acting US Attorney Mohsin. “I commend the agents and prosecutors who worked on this case and hope that this 28-year sentence helps bring some closure to the victim and victim’s family.”
This case was investigated by agents of the Federal Bureau of Investigations Task Force and was prosecuted by Assistant United States Attorneys Anca Pop and Jaqueline Hotz.
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Woman Pleads Guilty to Second Degree Murder on Indian ReservationRead the Press Release
BAY CITY - A 21-year-old resident of Blanchard, Michigan, Kaden Elizabeth Gilbert, pled guilty to murder in the second degree announced Acting U.S. Attorney Saima Mohsin.
The evidence established that in November of 2020, Gilbert went to the victim’s residence and intentionally stabbed her with a knife severing her femoral artery. The victim lost a significant amount of blood and died due to the stabbing. The crime occurred on the Isabella Reservation in Mt. Pleasant, Michigan. Gilbert is a non-Indian. The victim was Indian.
Sentencing is set for March 3, 2022 at 2 p.m. Gilbert faces up to life in prison.
The case was investigated by the Mount Pleasant Police Department and the Federal Bureau of Investigation. The case was prosecuted by Assistant United States Attorney Roy Kranz and Assistant United States Attorney J. Michael Buckley.
Hamtramck Man Sentenced to 12 years’ Imprisonment on Methamphetamine Distribution ChargesRead the Press Release
DETROIT – Don Valentino Zdybel, 61, formerly of Hamtramck, Michigan was sentenced yesterday to 12 years’ imprisonment on charges of possession methamphetamine with the intent to distribute it in the Detroit area, announced Acting United States Attorney Saima Mohsin.
Moshin was joined in the announcement by Special Agent in Charge Keith Martin, Drug Enforcement Administration, Detroit Division, Special Agent in Charge Rodney Hopkins, United States Postal Inspection Service and Peter Lucido, the Macomb County Prosecuting Attorney.
According to court records, from April of 2019 until May 27, 2020, when he was arrested, Zdybel was receiving methamphetamine sent from California to the Detroit area via the United States Mail and also personally transporting the drugs from California to Michigan himself. Arrested in Macomb County in February 2020 on methamphetamine and heroin possession charges, Zdybel was held without bond. He later convinced a Macomb County Circuit Judge in May of 2020 to release him on bond due to his fear of catching Covid-19. Zdybel then travelled from Michigan to California to pick up another load of methamphetamine. The Macomb County prosecution was later merged with the federal charges and Zdybel was prosecuted for the full extent of his criminal conduct in United States District Court.
“Zdybel is a man who was content to sell poison, in the form of methamphetamine, to generate an income for himself,” said Acting US Attorney Mohsin. “Zdybel has an extensive prior criminal record but his prior convictions and jail sentences have failed to deter him from committing crimes. He was given a chance to live a law abiding life when a judge released him from jail where he was being held without bond on a pending drug trafficking charge because Zdybel expressed fear of contracting COVID-19 in jail. He was released and Zdybel didn’t miss a beat. He went right back to drug trafficking while on bond. Those who cannot be deterred from committing crimes belong in prison. Zdybel’s sentence of 12 years will protect the public from this recidivist criminal.”
Lucido praised the work of the Warren and Sterling Heights Police Departments whose early efforts in the case served to build substantial and important evidence of the breadth of Zdybel’s conduct. “The excellent work of these officers and the ability to partner with DEA and the United States Attorney’s Office resulted in removing a dangerous drug dealer who was effectively destroying lives in Macomb County” said Lucido.
This case was investigated by special agents with the DEA, Officers from the Warren and Sterling Heights Police Departments and was prosecuted by Assistant United States Attorney John O’Brien.
Former University of Michigan Professor Pleads Guilty to Charges of Child Exploitation of a MinorRead the Press Release
DETROIT – Former University of Michigan professor pleaded guilty one count of transporting a minor girl across state lines with the intent to engage in sexual conduct, announced Acting United States Attorney Saima Mohsin.
Mohsin was joined in the announcement by Acting Special Agent in Charge James C. Harris, Homeland Security Investigations (HSI).
Pleading guilty was Stephen Shipps, 68, of Ann Arbor, Michigan.
From 1989 to 2019, Shipps was employed by the University of Michigan School of Music, Theatre, and Dance as a violin professor. Shipps was also the director of the Strings Preparatory Program, which offered instruction to young musicians ranging from elementary school through high school-age. Shipps retired from the University of Michigan in February 2019. In addition, Shipps served on the faculties of Indiana University, the North Carolina School of the Arts, the University of Nebraska – Omaha, and the Banff Centre in Canada. He also taught students at summer music programs in the Czech Republic, Germany, and the United Kingdom.
According to court records, from February and March of 2002, as well as in June and July of 2002, Shipps knowingly transported a minor girl, who was under 18 years old, across state lines, and Shipps intended to engage in sexual activity with her.
“Shipps used his position of trust to sexually exploit a child. Well regarded music professors at prestigious universities with competitive music programs like the University of Michigan enjoy tremendous influence within the music community. These professors often have the ability to make or break careers. Stephen Shipps was an influential and highly sought after violin professor who had successfully launched many careers. I commend the brave young woman who stepped forward and exposed Shipps’s abuse,” said Acting U.S. Attorney Mohsin. “This case proves that the passage of time, no matter how long, will not deter us from bringing to justice those who prey on our most vulnerable.”
“Thanks to the remarkable bravery of Shipps’ victims and painstaking investigative work by HSI, this disgraced professor is being held accountable for coercing vulnerable young women into sex acts,” said James C. Harris, acting Special Agent in Charge of Homeland Security Investigations field offices in Michigan and Ohio. “This case underscores HSI’s commitment to give due credibility to all allegations of sexual exploitation of minors and to bring some measure of justice to the victims.”
Shipps faces a statutory maximum penalty of 15 years in federal prison when he is scheduled to be sentenced on February 17, 2021 at 11 am.
This case was investigated by agents of HSI with the assistance of the University of Michigan Police Department. Assistant U.S. Attorney Sara Woodward is prosecuting this case.
Former Detroit Police Department Officer Pleads Guilty to Taking BribesRead the Press Release
DETROIT - A former Detroit Police Department officer pleaded guilty today in federal court in Detroit to accepting bribes, Acting United States Attorney Saima S. Mohsin announced.
Mohsin was joined in the announcement by Timothy Waters, Special Agent in Charge of the Detroit Field Office of the Federal Bureau of Investigation.
Pleading guilty before U.S. District Court Judge George Caram Steeh was Alonzo Jones, 55, of Detroit, Michigan.
According to the court documents, from in or about July 2019, and continuing through in or about May 2021, Alonzo Jones corruptly accepted approximately $3,200 in bribes with the intent to be influenced and rewarded in connection with his duties overseeing and running the Detroit Police Vehicle Auction.
Jones faces up to 10 years imprisonment and a fine of $250,000. Sentencing has been set for March 15, 2022.
“Investigating and prosecuting bad cops is a top priority for our office because bad cops erode the public’s trust in law enforcement,” said Acting US Attorney Mohsin. “The vast majority of police officers are honest, dedicated, and hard-working individuals. But police officers who line their pockets with bribes, no matter how big or small will be held accountable for their actions. Today’s plea highlights our office’s commitment to prosecuting those small minority of bad cops who put their own greed before their duties as police officers.”
“A law enforcement officer accepting bribes undermines the rule of law and will always be vigorously investigated. Today, Mr. Jones pled guilty to conduct that is not representative of the men and women of the Detroit Police Department who serve with honor day in and day out,” said Special Agent in Charge Timothy Waters of the FBI’s Detroit Field Office. “Thank you to Chief James White whose cooperation during this investigation made it possible to hold Jones accountable for his actions.”
This is the fourth individual charged as part of the government’s investigation known as “Operation Northern Hook.” Northern Hook is an investigation of corruption within the government and the Police Department of the City of Detroit relating to the towing industry and other matters.
The investigation of this case was conducted by the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorney Frances Lee Carlson.
Financial Secretary-Treasurer of UAW Local 412 Charged with Embezzling over $2 Million in Union FundsRead the Press Release
DETROIT - Timothy Edmunds, the Financial Secretary-Treasurer of Local 412 of the United Auto Workers union, has been charged in a Criminal Complaint with embezzling over $2 million in union funds announced Acting U.S. Attorney Saima S. Mohsin.
Joining in the announcement were Irene Lindow, Special Agent in Charge of the U.S. Department of Labor – Office of Inspector General, Timothy Waters, Special Agent in Charge of the Detroit, Michigan office of the Federal Bureau of Investigation, and Sarah Kull, Special Agent in Charge of the Detroit, Michigan office of the Internal Revenue Service – Criminal Investigations, and Thomas Murray, District Director, U.S. Department of Labor – Office of Labor-Management Standards.
Timothy Edmunds, 53, of South Lyon, Michigan, is charged in the Criminal Complaint, that was unsealed today, with embezzling union funds, money laundering, failing to maintain union records, and filing false reports with the Department of Labor between 2015 and 2021.
According to court records, between 2011 and 2021, Edmunds has served as the Financial Secretary-Treasurer of union Local 412 of the International Union, United Automobile, Aerospace, and Agricultural Workers of America (“UAW”). UAW Local 412 is headquartered in Warren, Michigan, and it represents approximately 2,600 members employed by the automaker FCA US LLC, which is owned by Stellantis N.V. The local union’s members include many of those employed at the following Stellantis facilities located within in the Detroit area: Sterling Stamping Plant, Mack Engine Plant, Warren Truck Assembly Plant, Warren Stamping Plant, and Jefferson Assembly Plant.
As an elected officer of UAW Local 412, Edmunds was responsible to hold its money and property solely for the benefit of the organization and its members and to manage, invest, and expend the funds in accordance with the UAW constitution and Local 412 bylaws. Instead, Edmunds systematically drained the Local 412 accounts of about $2 million by (1) using Local 412 debit cards for over $142,000 in personal purchases, (2) cashing Local 412 checks worth $170,000 into accounts he personally controlled, and (3) transferring $1.5 million from bone fide Local 412 accounts into accounts that he personally controlled. Once Edmunds converted the funds to his own personal use, he used the money to gamble, purchase luxury clothing, high-end automobiles, and firearms. To conceal his theft from other UAW officers and the Local 412 members, Edmunds created false bank statements and caused false LM reports to be filed with the U.S. DOL. Edmunds supplied the fake bank statements to international UAW auditors in an effort to conceal his embezzlement. Auditors from the UAW international union, who recently conducted an audit of Local 412, provided federal agents with information detailing the diversion of approximately $2 million in Local 412 funds by Edmunds.
Evidence indicates that Edmunds has used portions of the proceeds of his embezzlement to gamble extensively, to purchase firearms, and to purchase various high-end vehicles. For example, between 2018 and 2020, Edmunds used the UAW Local 412 debit card to make over $30,000 in unauthorized withdrawals at the Greektown Casino. While gambling at the Greektown Casino, records indicate that Edmunds had cash buy-ins of over $1 million, and he put over $16 million in play while betting while being rated at the casino. Between 2020 and the present, Edmunds registered at least 10 firearms, which ranged in price between $500 and $2,000 per firearm. In February 2016, Edmunds purchased a 2016 Jeep Grand Cherokee SRT for $74,365. In July 2020, Edmunds purchased a 2020 Jeep Grand Cherokee Trackhawk, for $96,419. Subsequently, in July 2021, Edmunds purchased a 2021 Dodge Durango for $76,491. Edmunds also leased two 2021 Jeep Grand Cherokee Limited in December 2020.
Based on the charge of embezzling union funds, Edmunds faces a maximum of five years in prison and a fine of up to $10,000. Based on the charge of money laundering, Edmunds faces a maximum of twenty years in prison and a fine of up to $500,000. On the charges of filing false reports with the Department of Labor, failing to maintain union records, and making false entries in union records, Edmunds faces a maximum of one year in prison and fine of $10,000.
A Criminal Complaint is only a charge and is not evidence of guilt.
Edmunds is the seventeenth defendant charged in connection with the ongoing criminal investigation into corruption within the UAW or relating to illegal payoffs to UAW officials by FCA executives. The following other individuals have already pleaded guilty to their participation in the scheme and have been sentenced: former UAW President Gary Jones (28 months in prison); former FCA Vice President for Employee Relations Alphons Iacobelli (66 months in prison), former FCA Financial Analyst Jerome Durden (15 months in prison), former Director of FCA’s Employee Relations Department Michael Brown (12 months in prison), former senior UAW officials Virdell King (60 days in prison), Keith Mickens (12 months in prison), Nancy A. Johnson (12 months in prison), Monica Morgan, the widow of UAW Vice President General Holiefield (18 months in prison), former UAW Vice President Norwood Jewell (15 months in prison), former senior UAW official Michael Grimes (28 moths), former UAW Midwest CAP President Edward “Nick” Robinson (12 months in prison), former UAW Vice President Joseph Ashton (30 months), former UAW President Dennis Williams (21 months) and former UAW Region 5 Director UAW Board member Vance Pearson (12 months in prison). The company, FCA US LLC, now known as Stellantis, pleaded guilty in January 2021 to conspiring to violate the Taft-Hartley Act, and was ordered to pay a fine of $30 million and be subject to an outside Monitor for three years. Former senior UAW official Jeffrey “Paycheck” Pietrzyk passed away before being sentenced.
In December 2020, the United States filed a civil lawsuit against the International UAW under the Anti-Fraud Injunction Act based on the criminal investigation of the UAW, FCA US LLC, and FCA’s executives. Subsequently, the United States and the International UAW entered into a Consent Decree to settle the lawsuit that was approved by the U.S. District Court. The Court has appointed attorney Neil Barofsky to serve as the Independent Monitor of the UAW for the next six years. The Monitor is tasked with providing federal oversight of the UAW concerning fraud, corruption, and misconduct within the UAW. In addition, the Monitor is conducting a referendum of all UAW members to determine if the membership wants to adopt a direct election, also known as “one member, one vote,” method of electing the members of the UAW’s International Executive Board.
Acting U.S. Attorney Mohsin commended the outstanding work of the Internal Revenue Service – Criminal Investigations, the U.S. Department of Labor – Office of Labor-Management Standards and Office of Inspector General, and the Federal Bureau of Investigation in conducting a comprehensive criminal investigation into labor corruption activities involving a vital sector of the local and national economy.
“The members of the UAW deserve a union free of corrupt and crooked leadership,” said Acting United States Attorney Saima Mohsin. “We will continue to root out and prosecute those corrupt leaders who seek to use UAW funds as their own personal piggybank.”
"An important mission of the Office of Inspector General is to investigate allegations of fraud involving labor unions. We will continue to work with our law enforcement partners to investigate these types of allegations,” stated Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General.
“Mr. Edmunds held a position of trust within the UAW and his alleged theft of nearly $2 million from UAW accounts is a betrayal to every UAW worker,” said Timothy Waters, Special Agent in Charge of the FBI’s Detroit Division. “The FBI and its law enforcement partners will use all available resources to hold criminals accountable and seek justice for those victimized.”
“This complaint leaves no question as to the Department of Labor’s commitment to seek justice for unions and their members when union officers or employees put their personal financial gain ahead of the best interests of the union and the members they represent,” said Thomas Murray, District Director, U.S. Department of Labor, Office of Labor-Management Standards. “Today’s complaint alleges an outrageous abuse of power and misuse of Mr. Edmunds’s position of trust. Mr. Edmunds allegedly embezzled over $2 million from the members of UAW Local 412, took extreme measures to conceal his actions from the union, and used embezzled funds to live a lavish lifestyle. While almost all union officials and employees pursue the best interests of the union and the members they represent, a very small amount do not. When a union official or employee endangers the financial integrity of their union, OLMS will seek justice for the union and its members.”
“Today’s allegation is yet another example of corrupt leadership and abuse of fiduciary duties of a trusted UAW official,” said Special Agent in Charge Sarah Kull, Internal Revenue Service – Criminal Investigation, Detroit Field Office. “IRS – Criminal Investigation is committed to investigating corrupt union officials who steal from their membership to enrich themselves.”
The case is being prosecuted by Assistant U.S. Attorneys David A. Gardey and Steven Cares.
Detroit Man Pleads Guilty to Stealing a Total of $1.6M in Unemployment Insurance Benefits from Nine StatesRead the Press Release
A Detroit man pleaded guilty today to wire fraud and identity theft in a scheme to defraud nine states out of more than $1.6 million in unemployment insurance benefits, announced Acting United States Attorney Saima Mohsin.
Joining in the announcement was Special Agent in Charge Timothy Waters, Federal Bureau of Investigation and Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor, Office of Inspector General
Jordan Armstrong, 29, of Detroit, entered his guilty pleas this morning, via Zoom, before United States District Judge Victoria A. Roberts.
According to court records, beginning on or about May 4, 2020 and continuing through at least October 21, 2020, Armstrong, with the intent to defraud, successfully submitted applications for unemployment insurance benefits on behalf of individuals in Michigan, California, Texas, Arizona, Pennsylvania, Tennessee, Massachusetts, New York, and Louisiana. Armstrong also unsuccessfully submitted claims in eight other states—in total filing more than 300 claims across 17 states and territories. Armstrong submitted these claims using these individuals’ Social Security Numbers and did so without their permission. Armstrong directed the benefits to be paid out via debit cards and then used these cards to repeatedly withdrawal the funds via ATMs throughout Metro Detroit.
As part of his guilty plea, Armstrong will be required to pay restitution to the victim-states in the total amount of $1,611,202.
Armstrong faces a statutory maximum penalty of 20 years imprisonment on the charge of wire fraud and a mandatory minimum sentence of 2 years imprisonment on the charge of identity theft.
Armstrong will be sentenced on March 22, 2022.
The investigation of this case was conducted by the Federal Bureau of Investigation, U.S. Department of Labor, Office of Inspector General with the assistance of the Birmingham Police Department. The case is being prosecuted by Assistant United States Attorney Ryan A. Particka.
Defendants Charged in $4M Unemployment Fraud CaseRead the Press Release
DETROIT – Two Michigan men have been charged via criminal complaint for their roles in a large-scale, multi-state Unemployment Insurance benefit fraud scheme, announced Acting United States Attorney Saima S. Mohsin.
Joining in the announcement were Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor, Office of Inspector General, Special Agent in Charge John R. Marengo, US Secret Service, Rodney Hopkins, Postal Inspector in Charge of the Detroit Division, Special Agent in Charge Sarah Kull, Internal Revenue Service-Criminal Investigation and Julia Dale, Director of the Unemployment Insurance Agency.
The complaint charges Jermaine Arnett, 34, of Pontiac, Michigan, and Terrance Calhoun, Jr., 32, also of Pontiac, Michigan, with aggravated identity theft, mail fraud, fraud using a false name and address, wire fraud, bank fraud, money laundering, and conspiracy to commit each of those acts, as well as firearm crimes.
According to the complaint, Arnett, Calhoun Jr., and one or more other individuals are responsible for filing over 500 claims for fraudulent unemployment insurance benefits across the United States, including Michigan, using just a handful of Internet Protocol addresses and mailing addresses. As described by the complaint, those false claims resulted in numerous debit cards loaded with unemployment insurance funds being mailed to addresses that Arnett, Calhoun Jr., and others controlled. The complaint alleges that Arnett, Calhoun Jr., and other individuals then systematically unloaded the funds from the cards by making large cash withdrawals at ATMs.
According to the complaint, between April and July 2020 those false claims resulted in multiple states collectively issuing more than $4 million in unemployment insurance benefits. The complaint alleges that, although a portion of the funds were electronically reclaimed before being unloaded, more than $1.7 million dollars in purchases and cash withdrawals were successfully made from the cards over a 2½ month period, and the majority of those cash withdrawals took place at ATMs located in Troy, Bloomfield Hills, and Rochester Hills, Michigan. As further described within the complaint, agents utilized ATM surveillance photos to identify Arnett and Calhoun Jr. as two of the individuals who made large cash withdrawals from ATMs using debit cards loaded with unemployment benefits issued in the names of other individuals. As also described within the complaint, when agents executed search warrants at three principal mailing addresses used for the fraudulent unemployment insurance benefit claims, including the residences of Arnett and Calhoun Jr., agents found and seized multiple debit cards in the names of numerous other individuals, distinctive clothing worn in ATM surveillance photos, firearms, and numerous documents containing the personal identification information of other individuals.
A complaint is only a charge and is not evidence of guilt. Trial cannot be held on felony charges in a complaint. When the investigation is completed, a determination will be made whether to seek a felony indictment.
This investigation is being conducted jointly by agents from the Department of Labor Office of the Inspector General, the United States Secret Service, the Internal Revenue Service – Criminal Investigations Division, the United States Postal Service Office of the Inspector General, and the State of Michigan -Unemployment Insurance Agency. The case is being prosecuted by Assistant United States Attorney Carl D. Gilmer-Hill.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
Former Certified Registered Nurse Anesthetist at Ann Arbor VA Hospital Sentenced to 3-Years’ Probation on Drug ChargesRead the Press Release
DETROIT - Former Certified Registered Nurse Anesthetist, Elizabeth Prophitt, age 39, of Saline, was sentenced today to 3-years’ probation for stealing controlled substances, including several opioids, from hospital dispensing machines, announced Acting United States Attorney Saima S. Mohsin.
Joining Mohsin in the announcement were Gavin McClaren, Acting Special Agent in Charge, Veteran’s Affairs, Office of Inspector General, Central Field Office and Special Agent in Charge Keith Martin, DEA, Detroit Division.
Prophitt, was sentenced by U.S District Court Judge Robert H. Cleland after pleading guilty to five counts of obtaining controlled substances by fraud, misrepresentation or deceit. She used her position as a surgical nurse to steal more than 2,000 vials of Schedule II and Schedule IV controlled substances, which included fentanyl, hydromorphone, morphine and midazolam. Prophitt would use protected patient information and falsify medical documents to obtain the controlled substances. Instead of using the medication on the purported patients, she diverted the drugs for her own personal use. At times, on days when she was unscheduled to work or after normal working hours, she would access the hospital and steal the vials directly from the hospital dispensing systems.
Acting United States Attorney Mohsin stated, “In order to protect the health and safety of our citizens, we take crimes like this seriously and will not hesitate to prosecute health care workers whose theft of drugs put patients in harm’s way.”
“We will not tolerate medical professionals stealing controlled substances intended for the care of our nation’s veterans,” said Acting Special Agent in Charge Gavin McClaren of the Department of Veterans Affairs Office of Inspector General’s Central Field Office.
This case was prosecuted by Assistant United States Attorney Brandy R. McMillion. McMillion serves as the District’s Opioid Fraud Abuse and Detection Prosecutor as well as the Deputy-Chief of the Health Care Fraud Unit. The Opioid Fraud Abuse and Detection Unit is a Department of Justice initiative designating twelve special prosecutors across the country to focus on prosecuting medical professionals that are contributing to the nation’s opioid crisis. The case was investigated by special agents of the Department of Veteran Affairs – Office of Inspector General and the Drug Enforcement Administration.
Lansing Man Convicted on 5 Counts Relating to the Production and Receipt of Child PornographyRead the Press Release
DETROIT – A federal jury today convicted a Lansing, Michigan man on multiple charges relating to the production and receipt of child pornography, announced Acting United States Attorney Saima Mohsin.
Mohsin was joined in the announcement by Special Agent in Charge Vance Callendar, Homeland Security Investigations.
Convicted was Michael McShan, 28. The 5-day trial, which began on Thursday, October 28, was conducted before United States District Judge David M. Lawson in Detroit. The jury deliberated approximately an hour before returning the guilty verdicts.
According to evidence presented during the trial, in December 2018, McShan met a minor female (MV-1) on a social media site called “MeetMe,” and then began communicating with MV-1 via Snapchat, cellphone calls and text messages. McShan quickly began an abusive and sexual relationship with MV-1. McShan enticed and persuaded MV-1 to produce images and videos of herself and another minor female victim (MV-2) engaging in sexually explicit conduct. Over the course of a few months, McShan, became increasingly controlling over MV-1. McShan coerced and enticed MV-1 through flattery, threats, and guilt to manipulate MV-1 into continuing to send him sexually explicit photos and videos as well as money.
Evidence further showed that in an attempt to get released on bond pending his trial, McShan directed his then-girlfriend, Madison, (AV-1) to write a false confession to the child exploitation crimes.
McShan was convicted of production of child pornography; attempted production of child pornography; receipt of child pornography; coercion and enticement of a minor, and obstruction of justice. McShan faces a maximum sentence of life in federal prison. A sentencing date has been set for March 1, 2022.
“Protecting children from dangerous child predators is a top priority for our office,” said Acting United States Attorney Mohsin. “I commend our law enforcement partners for their hard work and dedication to investigating and prosecuting crimes against children.”
“Even though schools do a great job educating our children about online safety, this case serves as an example of how manipulative child predators can be; please mind your child’s online activities,” said HSI Detroit Special Agent in Charge Vance Callender. “My special agents did an outstanding job investigating and preparing for trial on this case. I commend their efforts for the sake of the victims here.”
The case was investigated by special agents of Homeland Security Investigations. The case is being prosecuted by Assistant United States Attorneys Maggie Smith and Sara Woodward.
Redford Man Was Sentenced to 156 months’ imprisonment on Child Pornography ChargesRead the Press Release
DETROIT - A Redford man was sentenced today to 156 months’ imprisonment on charges of receiving child pornography, announced Acting United States Attorney Saima Mohsin.
Moshin was joined in the announcement by Special Agent in Charge Timothy Waters, Federal Bureau of Investigation, Detroit Division.
Sentenced was Devin Walker, Age 24.
According to court records, beginning in 2015 and continuing up until his arrest in November 2018, Walker enticed and persuaded minor females to produce images of themselves engaging in sexually explicit conduct. He threatened his victims with violence and exposure of their images if they did not continue to send sexually explicit photos and videos. Walker communicated with his victims on the Internet using his real name as well as an alias. A search of Walker’s devices revealed 31 videos and 105 images of child pornography. Walker’s victims ranged in age from 13-years old to 17-years old.
“Walker is a sexual predator who coerced and exploited children for his own sexual gratification. The images he obtained from girls as young as 13 are not merely pictures but are a permanent record of the sexual abuse and exploitation he visited upon these children,” stated Acting United States Attorney Mohsin. “I commend the work of the FBI and the prosecutors for their dedication to investigating and prosecuting Walker for these horrible crimes.”
"Walker's conduct is an all-too-familiar example of sextortion. Sextortion begins when a predator, through threat or manipulation, coerces a minor into producing a sexually explicit image and sending it over the Internet. He then uses the threat of sharing or publishing those images to get the victim to produce more," said Special Agent in Charge Timothy Waters of the FBI's Detroit Field Office. "Make no mistake, Walker is a predator. I thank the brave young victim who took the first step towards holding Walker accountable for his crimes by reporting him to law enforcement."
This case was investigated by special agents with the FBI and was prosecuted by Assistant United States Attorney Alyse Wu.
The FBI continues to see cases that involve adults coercing minors into producing sexual images and videos online. Take a moment to learn how sextortion works and how to talk to young people about it. Information, resources, and conversation guides are available at www.fbi.gov/StopSextortion.
Grand Blanc Man Sentenced to 48 Months in Prison After Pleading Guilty to Fraud, Kickback Violations Involving UAW Health Care FundRead the Press Release
A Grand Blanc, Michigan man was sentenced to 48 months in prison after having pleaded guilty to supervising a complex fraud and kickback scheme involving UAW members and medically unnecessary compounded pain creams, scar creams, pain patches and/or vitamins, announced Acting United States Attorney Saima Mohsin.
Mohsin was joined in the announcement by Special Agent in Charge Lynda M. Burdelik, FDA Office of Criminal Investigations Chicago Field Office and Mario M. Pinto, Special Agent in Charge of the Chicago Region of the U.S. Department of Health and Human Services Office of Inspector General
Sentenced was Patrick Wittbrodt, 46. In addition to the custodial sentence, United States District Judge Laurie J. Michelson also ordered that Wittbrodt be placed on a two-year term of supervised release. In addition, Wittbrodt was ordered to pay $7,317,173.51 in restitution to Blue Cross Blue Shield of Michigan and $902,387.93 in restitution to Medicare. As part of his plea agreement, Wittbrodt also agreed to forfeit approximately $72,000 seized by federal agents.
According to court documents, Wittbrodt and his co-defendants caused an approximate $8,000,000 loss to Medicare and Blue Cross Blue Shield of Michigan (“BCBS”). Some of this money was stolen from UAW members’ prescription insurance accounts.
Court documents outlined the scheme:
Due to the high reimbursement rate paid by Medicare and BCBS for prescription pain cream, scar cream, pain patches and/or vitamins, defendants targeted these insurance plans. Wittbrodt and others would then schedule time at various UAW meetings where defendants would tout pain cream, scar cream, pain patches and vitamins to the UAW members. An aspect of the presentation was that the UAW members could receive their prescriptions free -- without paying a prescription drug copay at the pharmacy. UAW members did not realize that acceptance of the “free” medications would cost their health care fund millions of dollars.
Defendants would then collect the UAW members’ insurance information along with their family members’ insurance information. According to court documents, Dr. April Tyler, who also pleaded guilty in the case, would then authorize the pain cream, scar cream, pain patch and/or vitamin prescriptions for the UAW members and/or their family members. Defendant Dr. Tyler did not establish a valid doctor-patient relationship with any of the UAW members, did not perform a physical exam and did not determine medical necessity for the prescriptions she wrote for the UAW members. The prescriptions were not, therefore, legally eligible for reimbursement from the various insurance companies. Defendant Dr. Tyler also pre-signed prescription forms and allowed defendants to choose which compounded creams, patches and vitamins to write on the prescriptions.
Wittbrodt directed the prescriptions to various pharmacies. The pharmacies would fill the prescriptions, bill the UAW members’ insurance and pay a monetary kickback to Wittbrodt. Wittbrodt would then provide remuneration to co-conspirators from the kickbacks he received. The prescriptions were periodically re-filled and/or re-billed, regardless of whether the UAW member requested a refill or not. The prescription co-pay was waived at the pharmacy for the UAW members. Another defendant, Jeffrey Fillmore, is scheduled for sentencing on November 23, 2021.
“The unlawful actions of these defendants diverted taxpayer dollars and medications from patients who actually needed them in order to line their own pockets,” said Acting United States Attorney Saima Mohsin. “We will continue to aggressively prosecute health care fraud and hold those who commit it accountable.”
“Medical professionals who try to enrich themselves by billing federal health care programs for medically unnecessary prescription medications threaten the integrity of these programs and waste valuable taxpayer dollars that are otherwise utilized to provide medications that patients genuinely need,” said Mario M. Pinto, Special Agent in Charge of the Chicago Region of the U.S. Department of Health and Human Services Office of Inspector General. “Our agency, working together with our law enforcement partners, will continue to pursue criminals who threaten these vital health care programs.”
“Schemes that solicit and provide unneeded prescription drugs to patients erodes the confidence that U.S. consumers have in their health care professionals and others in positions of trust,” said Special Agent in Charge Lynda M. Burdelik, FDA Office of Criminal Investigations Chicago Field Office. “Medical professionals and others should know that the FDA will investigate and bring to justice those involved in the illegal distribution of prescription drugs.”
“This case demonstrates that collaboration between law enforcement and private insurance investigators is essential in prosecuting those responsible for federal healthcare fraud and kickback violations,” said by Dan Crowell, Blue Cross Blue Shield of Michigan, Director of Corporate and Financial Investigations.
This case was investigated by the United States Department of Health and Human Services – Office of Inspector General, the United States Food and Drug Administration and Blue Cross Blue Shield of Michigan, under the supervision of the U.S. Attorney’s Office for the Eastern District of Michigan. Assistant U.S. Attorney Philip A. Ross and Wayne Pratt are prosecuting the case.
Roscommon Man Convicted on 5 Counts of Possessing, Receivng and Transporting Child PornographyRead the Press Release
BAY CITY – A federal jury convicted a Roscommon County man on charges of possessing, receiving, and transporting child pornography, announced Acting United States Attorney Saima Mohsin.
Mohsin was joined in the announcement by Special Agent in Charge Vance Callendar, Homeland Security Investigations and Sheriff Ed Stern, Roscommon County Sheriff’s Department.
Convicted was Scott Lantzy, 49. The 4 day trial which began on Thursday, October 21st and ended on Tuesday October 26th, was conducted before United States District Judge Thomas Ludington in Bay City. The jury deliberated approximately 45 minutes before returning the guilty verdicts.
According to evidence presented during the trial, Lantzy, is a serial sex offender with four prior CSC convictions, one conviction for accosting a minor, and two SORNA-related convictions spanning from 1998 until present. Lantzy came to the attention of law enforcement when he impersonated an EMT at a high school football game. During the game, Lantzy came onto the field to aid an injured player. He accompanied the teen to the hospital, where he made his way into the emergency room. He continued to attempt contact with the injured player the following day. A few months before the football game, Lantzy befriended another high school student who testified at the trial. This student testified that while housesitting for Lantzy, Lantzy called him and told him that he had left him a camera and condoms and that the student should send Lantzy pictures of what he and his friend were doing while house sitting. When Lantzy arrived home, the student testified that he saw pictures of child pornography on Lantzy’s personal cell phone. This led detectives from the Roscommon County Sheriff’s Department to execute a search warrant on Lantzy’s home.
Lantzy was convicted of two counts of possession/access with intent to view child pornography; one count of possession of child pornography; one count of transportation of child pornography; and one count of receipt of child pornography. Lantzy faces a maximum sentence of 40 years in federal prison. A sentencing date has been February 3, 2022 in Bay City.
“Protecting children from dangerous and cunning serial child predators is a top priority for our office,” said Acting United States Attorney Mohsin. “The possession, transportation and receipt of child pornography will not be tolerated by this office. I commend our law enforcement partners for their hard work and dedication to investigating and prosecuting crimes against children.”
The case was investigated by the Roscommon County Sheriff’s Department and special agents of Homeland Security Investigations in Sault Ste. Marie and Detroit, with assistance from the Michigan State Police. The case is being prosecuted by Assistant United States Attorneys Tim Turkelson and Alison Furtaw.
State Contractor Sentenced in $3 million Unemployment Fraud SchemeRead the Press Release
A Detroit woman was sentenced today to 58 months in federal prison after having pleaded guilty for her role in a multi-million dollar unemployment insurance fraud scheme aimed at defrauding the State of Michigan and the U.S. Government of funds earmarked for unemployment assistance during the COVID19 pandemic, announced Acting United States Attorney Saima Mohsin.
Joining in the announcement were Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General, Special Agent in Charge John R. Marengo, US Secret Service, Rodney Hopkins, Postal Inspector in Charge of the Detroit Division, Special Agent in Charge Timothy Waters, Federal Bureau of Investigation, Acting Special Agent in Charge Brian Thomas, Internal Revenue Service-Criminal Investigation and Liza Estlund Olson, former acting director of the Unemployment Insurance Agency.Brandi Hawkins, 40, was sentenced before United States District Judge Paul D. Borman. As part of her sentence, Judge Borman ordered Hawkins to pay restitution to the State of Michigan in the amount of $3,793,186.
According to court records, Brandi Hawkins was a contract employee for the State of Michigan Unemployment Insurance Agency. Her duties included reviewing, processing and verifying the legitimacy of unemployment insurance claims. Between April and June of 2020, HAWKINS worked with outside actors, known and unknown to law enforcement. Daily, those actors entered numerous false claims into the State of Michigan’s Unemployment Insurance Agency system, many of which were filed using stolen identities. These actors communicated with HAWKINS by cellular telephone calls and texts. HAWKINS accepted bribes in return for releasing many of these claims. HAWKINS used her insider access to fraudulently release payment on over seven-hundred claims, more than ten of which involved claims filed using stolen identities. HAWKINS’s actions resulted in the fraudulent disbursement of approximately $3.8 million of federal and state funds intended for unemployment assistance during the pandemic. Had every fraudulent claim released by HAWKINS been disbursed in full, the resulting loss of federal and state funds would have been over $12 million.
During the execution of a search warrant at Hawkins’ residence, over $200,000 in cash was seized. Hawkins used proceeds from her crimes to purchase high-end handbags and other luxury goods.
“Hawkins exploited the pandemic to defraud the State of Michigan and United States for her own personal gain,” said Acting US Attorney Mohsin. “This sentence should send a message to those who seek to divert funds intended for those in need during what has been a very difficult period of unemployment – you will be prosecuted”
“Hawkins used her position with the state of Michigan to steal millions from Michigan taxpayers and today’s sentencing should serve as a warning to anyone thinking of committing a similar crime.” stated Acting Special Agent in Charge Brian Thomas, IRS-Criminal Investigation, Detroit Field Office. “IRS-Criminal Investigation is steadfast in protecting Covid-19 Pandemic related programs geared toward assisting people and businesses in need.”
“Brandi Hawkins while employed as a contractor used her position to take advantage of the public and defraud the State of Michigan. She was able to manipulated the Michigan Unemployment Insurance Agency system for her and others’ personal gain. We will continue to work with our law enforcement partners throughout Michigan to bring criminals like Hawkins to justice,” said John R. Marengo, Special Agent in Charge, U.S. Secret Service, Detroit Field Office.
"Brandi Hawkins used her insider access as a State of Michigan contract employee to fraudulently disburse millions of dollars in Pandemic Unemployment Assistance benefits. Today's sentencing affirms the U.S. Department of Labor Office of Inspector General’s commitment to vigorously pursue those who steal funds intended for individuals who lost their jobs during the COVID-19 pandemic. We will continue to work with our federal and state partners to protect the integrity of unemployment insurance benefit programs," stated Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General.
"Brandi Hawkins used her position as a contractor with the state of Michigan to manipulate the unemployment insurance system to benefit herself and her co-conspirators," said Timothy Waters, Special Agent in Charge of the FBI's Detroit Division. "The FBI is proud to work with our law enforcement partners to hold wrongdoers accountable and to protect the integrity of vital federal assistance programs."
“Ms. Hawkins betrayed the trust given to her by her employer when she used her access to privileged information in a scheme to steal from the government and the people of Michigan. Today’s sentencing represents the commitment of law enforcement to bring those to justice who disrespect the rule of law, hurting the American public,” said Inspector in Charge Rodney M. Hopkins.
“People who willfully commit unemployment insurance fraud should know that the State of Michigan and the Unemployment Insurance Agency are serious about identifying and holding them accountable for their actions,” said Liza Estlund Olson, former acting director of the Unemployment Insurance Agency. “Through the great work of our federal and state partners along with UIA investigators, we’re are working to root out fraudulent schemes like this one and protect unemployment benefits for those who are legitimately entitled to them.”
The case was prosecuted by Assistant United States Attorney Timothy Wyse. The investigation was conducted jointly by the Department of Labor, Office of Inspector General, United States Secret Service, Internal Revenue Service - Criminal Investigation, Federal Bureau of Investigation, the U.S. Postal Inspection Service and the Unemployment Insurance Agency, Michigan Department of Labor and Economic Opportunity