Western District of Michigan
Press releases recorded for this federal judicial district.
Lawrence Nassar Sentenced to 60 Years in Federal PrisonRead the Press Release
GRAND RAPIDS, MICHIGAN – Lawrence Gerard Nassar, 54, of Holt, Michigan, was sentenced to 60 years in federal prison for child-pornography and obstruction-of-justice offenses, U.S. Attorney Andrew Birge announced today. U.S. District Judge Janet T. Neff ordered the federal sentence to be served consecutive to the sentences he receives in state court. In addition to the prison term, Nassar must also register as a sex offender, and, if released from prison, he will be subject to a lifetime term of supervised release.
In July of this year, Nassar pleaded guilty in federal court to receiving child pornography in 2004, possessing child pornography from 2003 to 2016, and destroying and concealing evidence in 2016 when he believed, correctly, that ongoing investigation by law enforcement would reveal his child-pornography activities. As part of a plea agreement, Nassar agreed not to oppose a sentencing enhancement for engaging in a pattern of activity involving the sexual abuse or exploitation of minors. That enhancement, based on his extensive history of personally sexually molesting minors, increased his advisory U.S. Sentencing Guideline range by over 70%. This is the same enhancement that would have applied had he been convicted of additional federal charges related to his hands-on misconduct, such as for traveling interstate with intent to engage in illicit sexual conduct. By the time of his sentencing, Nassar faced an advisory guideline range of 30 years to life in prison, capped by the combined statutory maximum for the three counts of 60 years.
Dozens of victims participated in the federal sentencing proceeding by submitting written victim-impact statements to the Court. The victims wrote about the pain and trauma Nassar caused them, their shattered trust and innocence, the enduring impact this conduct has had on their lives, and their desire to see justice. The victims called on the Court to severely punish Nassar and protect others from further acts of sexual predation.
In announcing the sentence, Judge Neff left no doubt that “maximum potential penalties are in order here.” She found the case “unique.” The images Nassar collected were numerous and “like none other that I’ve seen.” She expressed dismay that Nassar was a doctor and was troubled by the thought that he might have “felt omnipotent” for getting away with sexually assaulting his victims when their mother was in the room. “I am a mom. I cannot imagine [the anguish those mothers must feel].” She chastised Nassar for violating the most basic tenant of medicine – “Do no harm.” Finally, the Judge expressed deep concern for the victims’ sense of self-worth that was destroyed. She concluded that Nassar “is, was, and will be a danger to children.” “It is through consecutive sentencing that I can protect young children.”
Following the sentencing, U.S. Attorney Birge said: “Today was a day of reckoning for Larry Nassar. He more than deserves this punishment for what he did. He consumed child pornography on a massive scale. We found 37,000 images of child pornography on his computers. Insatiable hunger of that nature simply encourages those who produce such images to continue to sexually exploit children. Compounding his danger to the public, Nassar was an insidious hands-on child predator in his own right. He took advantage of family friendships. And he treated his license to practice medicine as a license to sexually molest children. Thanks to the brave victims who came forward, we learned the full scope of his depravity. The breadth and dark depth of his heinous acts are extraordinary.”
U.S. Attorney Birge added: “My heart goes out to the victims-- those in the images and those he personally sexually molested. With today’s sentencing, I hope his victims find a sense of renewed self-worth in knowing their role in this outcome. And I hope they and the public find some measure of solace and reassurance in knowing that Nassar has been held accountable for his actions. Anyone who exploits children will be found out and held accountable regardless of their position or station in life.” U.S. Attorney Birge then expressed his thanks to the victims for making the outcome possible in this case and he thanked the FBI and Michigan State University Police for their efforts in support of the charges.
“Today’s sentencing represents an important achievement as we take another step in this long process of holding Nassar accountable for his shocking predatory acts of child sexual abuse and exploitation,” said David P. Gelios, Special Agent in Charge, Detroit Division of the FBI. “I want to thank those involved at the FBI in Detroit and Los Angeles, Michigan State University Police Department, and the U.S. Attorney’s Office for their tireless work to bring Nassar to justice. This punishment of a man who once held a position of trust and enjoyed the trust and respect of many should serve as a warning to those who prey upon and sexually exploit children that there will be severe consequences for crimes of this nature. My thoughts are with all the victims whose lives have been forever impacted.”
Michigan State University Police Chief Jim Dunlap commented that: “The Michigan State University Police Department appreciates the effective collaboration with the FBI and the U.S. Attorney’s Office to achieve a measure of justice for the survivors.”
This case is part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. The U.S. Attorney's Office, county prosecutor's offices, the Internet Crimes Against Children task force (ICAC), federal, state, tribal, and local law enforcement are working closely together to locate, apprehend, and prosecute individuals who exploit children. The partners in Project Safe Childhood work to educate local communities about the dangers of online child exploitation, and to teach children how to protect themselves. For more information about Project Safe Childhood, please visit the following web site: www.projectsafechildhood.gov. Individuals with information or concerns about possible child exploitation should contact local law enforcement officials.
The Detroit and Los Angeles Divisions of the Federal Bureau of Investigation (FBI) and the Michigan State University Police Department (MSUPD) investigated the case. Assistant U.S. Attorney Sean M. Lewis prosecuted the case.
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Marijuana Grower / Distributor Sentenced to over 12 Years in Federal PrisonRead the Press Release
MARQUETTE, MICHIGAN —Spencer Troy Ward, age 56, formerly of Bruce Crossing, Michigan, was sentenced to 151 months (12 years, 7 months) in prison for his involvement in a marijuana production and distribution conspiracy that Ward led in Ontonagon, Iron and Marquette Counties in the Upper Peninsula of Michigan, announced U.S. Attorney Andrew Birge.
U.S. District Judge Paul Maloney also ordered Ward to pay the government $475,254.30, which constituted the gross proceeds of his illegal sales of marijuana. In addition, the Judge ordered the forfeiture of Ward’s 80-acre farm, which Ward used to manufacture marijuana.
Ward came to the attention of a Special Agent from the Bureau of Indian Affairs (BIA) and detectives from the Upper Peninsula Substance Enforcement Team (UPSET) in 2014, after law enforcement officers from the Lac Vieux Desert (LVD) reservation near Watersmeet, MI reported that marijuana produced and sold by Ward was making its way onto the LVD reservation.
Investigators from BIA and UPSET discovered that Ward and his associates were growing marijuana at Ward’s farm and operating marijuana stores in Watersmeet, Iron River and Marquette. Ward also had plans to open another marijuana store in Houghton. BIA and UPSET executed search warrants at Ward’s farm and the stores in February 2016, and found a large-scale, sophisticated grow operation that contained 186 marijuana plants in various stages of growth, and more than 100 pounds of processed marijuana.
Grand Rapids Man Pleads Guilty to Student Loan and Tax FraudRead the Press Release
GRAND RAPIDS, MICHIGAN — U.S. Attorney Andrew Birge announced today that Brandon Kenon Rogers, 31, of Grand Rapids, pled guilty to student loan and tax fraud. Rogers’s wire fraud scheme involved aggravated identity theft and ultimately defrauded the U.S. Department of Education of approximately $150,000. His filing of false tax returns using other people’s information led to the tax fraud conviction.
During his plea hearing before Magistrate Judge Phillip J. Green, Rogers admitted to defrauding the U.S. Department of Education by obtaining the identity information of others and posing as those individuals while applying online for Student Loans and Pell Grants in their names. He also enrolled online in local community colleges, including Grand Rapids Community College and Kalamazoo Valley Community College, using those same identities. Rogers’s aid applications were approved, and as a result, he received loans and grants and used them for his own purposes without actually attending the classes as required. Rogers further admitted he also used the personal identity information he obtained to file bogus tax returns seeking refunds in the name of others. He told the court that he would assist the government to locate and prosecute others engaged in the same activity.
Wire fraud carries a maximum possible penalty of 20 years in prison plus other penalties. Aggravated Identity Theft carries a mandatory two-year prison term, which must be served after the completion of any other sentence. Income tax fraud carries a maximum possible sentence of five years in prison plus other penalties. Sentencing on the matter will be held before U.S. District Judge Paul Maloney at a date and time to be determined.
U.S. Attorney Birge advised that: "These loan and grant programs are for students who want to better themselves with an education and obviously not for those who would take advantage to simply line their pockets. Rogers didn’t actually attend his classes, but he is learning a lesson in criminal justice that should serve as a warning to others."
The Grand Rapids Community College Department of Public Safety, the U.S. Department of Education, Office of Inspector General, the Federal Bureau of Investigation and the Internal Revenue Service investigated this case. Assistant U.S. Attorney Timothy VerHey is handling the prosecution.
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Psychologist George E. Compton Jr. of Sturgis Sentenced for Health Care FraudRead the Press Release
Compton Billed Insurers for Numerous Counseling Sessions that he did not Provide
GRAND RAPIDS, MICHIGAN —George E. Compton, Jr., 63, of Sturgis, Michigan, was sentenced to 28 months in prison, U.S. Attorney Andrew Birge announced today. Compton previously pled guilty to executing a health care fraud scheme from January 1, 2013, until June 30, 2016, when he repeatedly billed numerous health care insurance companies for psychological counseling sessions that he never provided. When imposing the sentence, U.S. District Court Judge Gordon Quist commented that Compton had "ample opportunity to come clean" and that his conduct "contributed to a loss of confidence in the health care industry as a whole because of what occurred right here in our own neighborhood." The court also ordered Compton to pay restitution to the health care insurance companies that he defrauded.
"Unfortunately, this case represents yet another example of how some health care professionals allow their own greed to lead them down the path of defrauding health care benefit programs and ultimately harming consumers," said U.S. Attorney Birge. "My office will continue to vigorously prosecute those who commit health care fraud against private or public health insurance plans."
Compton, who operated a psychology practice in Coldwater, Michigan, established legitimate relationships with numerous patients to provide periodic counseling sessions. However, after establishing these relationships, Compton regularly billed his patients’ health care benefit programs for counseling sessions that grossly exceeded the number of actual counseling sessions that he provided, including billing one patient’s insurance 100 times when her children only actually received eight counseling sessions. When his patients or the health care benefit programs occasionally detected his excess billings, Compton claimed that the billings were the result of an honest mistake or the automated billing functions of his billing software and he reimbursed the health care benefit program for the over-payment. Additionally, when audited by one of the health care benefit programs, Compton created fake patient counseling notes in an attempt to make it appear as if he actually provided counseling sessions on dates that he knew he had previously submitted false billings. During the 41 months that the fraud occurred, Compton received over $800,000.00 in fraudulent insurance payments and spent over $410,000.00 on various credit cards for items including sound equipment for his business ACE Mobile Recording, vacations, concert tickets, and other personal items.
"The march before the federal bench of health care providers to answer for fraudulent billing practices continues with the sentencing of George Compton today," said David P. Gelios, Special Agent in Charge, Detroit Division of the FBI. "So long as there are those like Mr. Compton who place greed over their oath, and siphon away critical resources from our health care system contributing to the rising cost of health care for all Americans, the FBI and our partners will continue our work to identify offenders and bring them to justice."
The case was investigated by the Kalamazoo office of the FBI and prosecuted by Assistant U.S. Attorney Ronald M. Stella.
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Traverse City Physician Sentenced to Incarceration for Fraudulent PrescriptionsRead the Press Release
GRAND RAPIDS, MICHIGAN — Acting U.S. Attorney Andrew Birge announced that on Monday, November 6, 2017, Mark Edward Brewster, M.D., of Traverse City, Michigan, was sentenced to 10 months’ incarceration following his guilty plea to writing fraudulent prescriptions to obtain controlled substances. Brewster will also pay restitution to Blue Cross Blue Shield of Michigan, which paid for a number of Brewster’s fraudulent prescriptions. Brewster further surrendered his DEA registration to federal authorities as part of this investigation.
A federal investigation revealed that between 2006 and 2015, Brewster wrote over 150 fraudulent prescriptions in the names of seven different people in order to obtain quantities of Ritalin, a Schedule II controlled substance, that ultimately exceeded five times the maximumFDA-approved adult dosage. Brewster started issuing fraudulent prescriptions before he graduated from medical school, wrote fraudulent prescriptions while he was on state court probation for a domestic violence conviction, and continued writing fraudulent prescriptions after being fired by a northern Michigan hospital for his prescribing practices. When Brewster’s prescriptions to his girlfriend became the subject of a state licensing investigation in 2015, he assured state investigators that, going forward, there was "zero chance" he would write prescriptions for anyone other than his patients. Brewster continued writing fraudulent prescriptions the very next day and concealed those prescriptions by writing them in the names of his girlfriend’s minor children and others who were unknown to licensing investigators.
During his nearly decade-long prescription fraud, Brewster boasted, in text messages, that he was "[s]ticking it to the man" by having some of his fraudulent prescriptions paid for by other people’s private insurance. Brewster also falsified progress notes in a patient’s medical record to cover other fraudulent prescriptions.When he became aware of the federal investigation, Brewster instructed people not tell the DEA anything about his fraudulent prescriptions.
At sentencing, Judge Maloney described Brewster’s crime as "a product of the doctor’s arrogance" and noted that Brewster caused a number of otherwise law-abiding people to become involved in felonious conduct. The sentence, Judge Maloney said, should deter other health care professionals who might consider illegally abusing their prescribing authorities to obtain drugs for themselves or others.
In connection with this investigation, Brewster’s girlfriend, Nicole Aiello, R.N., also pled guilty to aiding and abetting Brewster in illegally obtaining controlled substances. Aiello will be sentenced on January 5, 2018. To date, the U.S. Attorney’s Office has further recovered $46,200.00 in civil penalties from other individuals who filled fraudulent prescriptions and returned controlled substances to Brewster.
"The U.S. Attorney’s Office will aggressively use all available criminal, civil, and administrative remedies when health care professionals abuse their licenses to illegally prescribe controlled substances for themselves or others," Acting U.S. Attorney Birge said. "The national epidemic of prescription drug abuse warrants the serious attention that we give this conduct."
This case was investigated by the U.S. Drug Enforcement Administration, Blue Cross Blue Shield of Michigan, and the U.S. Attorney’s Office. The case was prosecuted by Assistant U.S. Attorneys Adam B. Townshend and Raymond E. Beckering III.
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Wilson Man Convicted in Federal Court of Abusive Sexual Contact with A Child Under 12 YearsRead the Press Release
MARQUETTE, MICHIGAN —Patrick Roy Wandahsega, 40, of Wilson, Michigan, was found guilty of abusive sexual contact with a child under 12 years, Acting U.S. Attorney Andrew Byerly Birge, announced today. The trial, which lasted four days, was held before U.S. District Judge Paul L. Maloney.
The charge arose from an incident in December 2015, in which Wandahsega sexually abused a six-year-old child at his home on the Hannahville reservation. Hannahville law enforcement became aware of the incident when the victim reported the abuse to relatives and later a physician. After an extensive investigation, a federal grand jury indicted Wandahsega on two counts – the first charging Aggravated Sexual Abuse of a Child and the second charging, Abusive Sexual Contact Involving Young Children. The jury found Wandahsega guilty of the second charge. At sentencing, which has yet to be scheduled, Wandahsega will be facing a maximum of life imprisonment.
This case is part of Project Safe Childhood, a nationwide initiative designed to protect children from sexual exploitation and abuse. The U.S. Attorney's Office, county and tribal prosecutor's offices, the Internet Crimes Against Children task force (ICAC), federal, state, tribal, and local law enforcement are working closely together to locate, apprehend, and prosecute individuals who exploit children. The partners in Project Safe Childhood work to educate local communities about the dangers of child exploitation, and to teach children how to protect themselves. For more information about Project Safe Childhood, please visit the following web site: www.projectsafechildhood.gov. Individuals with information or concerns about possible child exploitation should contact local law enforcement officials.
The Hannahville Tribal Police and the Federal Bureau of Investigation investigated the case. Assistant U.S. Attorneys Hannah N. Bobee and Paul D. Lochner prosecuted the case.
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Bessemer, Michigan Crystal Meth Dealer Sentenced to over 17 Years in Federal PrisonRead the Press Release
MARQUETTE, MICHIGAN —Jeremy James Whitebird, age 34 and formerly a resident of Bessemer, MI, was sentenced to 212 months (17 years, 8 months) in federal prison as a result of Whitebird’s involvement in methamphetamine trafficking and unlawful gun possession in Gogebic County, Acting U.S. Attorney Andrew Birge announced today.
In January 2017, officers assigned to the Gogebic Iron-Area Narcotics Team (GIANT) learned that Whitebird was selling significant amounts of crystal methamphetamine (meth) and other drugs in the Bessemer and Ironwood area. Acting on this information, undercover GIANT officers purchased ounces of crystal meth from Whitebird on three separate occasions and followed that with a search warrant at his residence. During the search, police found 424 grams (about 15 ounces) of crystal meth, 194 grams of cocaine, 27 grams of heroin and 3.5 pounds of marijuana. Whitebird, who has multiple prior felony convictions, was also in possession of several firearms. In addition, Whitebird, who is the father of six children and currently owes more than $25,000 in child support, had about $15,000 in cash in his possession.
Following these discoveries, Sergeant Matthew J. Sterbenz, the head of GIANT, contacted the U.S. Drug Enforcement Administration (DEA) and the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) so that Whitebird would be prosecuted in federal court. After Whitebird’s sentencing, Sgt. Sterbenz thanked the officers of GIANT and the Gogebic Iron-Area SWAT Team, the Special Agents of the DEA and ATF, the U.S. Attorney’s Office and Beacon Ambulance Service (which provided standby emergency medical response during the execution of the search warrant) for their work on the investigation.
On June 26, 2017, Whitebird pleaded guilty to one count of possession with intent to distribute methamphetamine and a count related to being a felon in possession of a firearm. U.S. District Judge Paul L. Maloney sentenced Whitebird to 212 months for the meth offense and ordered the 120-month sentence for the firearm offense to run concurrently. Whitebird will also serve 5 years on supervised release after he is released from prison.
Acting U.S. Attorney Andrew Birge observed that the western part of the Upper Peninsula of Michigan is being hit particularly hard by a caustic mix of crystal methamphetamine, opioid addiction, and opioid-related overdoses. Birge vowed that the U.S. Attorney’s Office and its partners at DEA, ATF, and local narcotics teams will continue to aggressively investigate and prosecute armed drug traffickers like Whitebird.
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Four Defendants Sentenced to A Total of 64 Years' Imprisonment for Sex Trafficking Two 14-Year-Old Girls in Battle CreekRead the Press Release
GRAND RAPIDS, MICHIGAN — James Smith, 28, of Battle Creek, Michigan, received a 20 year sentence in federal prison for sex trafficking a minor, Acting U.S. Attorney Andrew Birge announced today. Smith is the fourth defendant sentenced in this case, which arose out of the sex trafficking of two local 14-year-old girls in Battle Creek in June of 2016. The four defendants received a total sentence of 64 years’ imprisonment, which, in addition to Smith’s sentence, breaks down as follows:
- 20 Years – William Edwards, 24, recruited both 14-year old victims into sex trafficking;
- 20 Years – Dakota Walters, 25, coached and helped Edwards with sex trafficking the minors;
- 4 Years – Michael Noble, 22, knowingly drove one of the victims to several places for commercial sex.
In June of 2016, Edwards recruited the first 14-year-old victim by preying on her after she ran away from home and needed money. Edwards told her he knew how to help her make money and took her to Walters’ house, where the two men created an online advertisement for sex with the minor. They told her to act 18, despite knowing she was only 14. They also gave her cocaine, telling her it would help her stay up longer to make more money. He took half of all the money she made. When one client did not pay the minor, Edwards grabbed her neck and threw her against a wall. That girl eventually fled from Edwards.
After the first minor left, Edwards turned to another 14-year-old runaway, whom he eventually handed off to Smith. Smith forced the girl to engage in commercial sex for about a week. Like Edwards, Smith provided the girl with cocaine and recruited Noble, who provided Smith and the minor with cocaine in exchange for driving her to meet johns. Smith carried a gun, forced the girl to have sex with him, and took away her phone so she could not contact her family for approximately one week while trapped in a Battle Creek motel with Smith, Noble, and an 18-year-old female. The minor finally escaped when she located her phone while the others slept, texted her aunt, and ran.
"The Western District of Michigan has seen this pattern again and again, where grown men—and sometimes women—use drugs, money, and various promises to lure vulnerable teens into commercial sex for the adults’ own financial gain," said Andrew Birge, Acting U.S. Attorney. "The manipulation and exploitation trap the victims, who are often in desperate need of adult attention, financial security, and basic necessities."
"Today’s sentencing effectively ends a heinous sex trafficking scheme that exploited two underage girls," said Steve Francis, HSI Detroit special agent in charge. "Using our victim-centered approach, HSI can now focus on ensuring the survivors of these depraved acts continue to get the help they need to rebuild their lives."
This case was the result of a collaborative investigative effort between Homeland Security Investigations and the Battle Creek Police Department. Assistant U.S. Attorneys Tessa K. Hessmiller and Davin Reust prosecuted the cases. For more information about Project Safe Childhood and the investigation and prosecution of sex trafficking in the Western District of Michigan, visit https://www.justice.gov/usao-wdmi/project-safe-childhood.
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DEA in Michigan along with local law enforcement partners hold Prescription Drug Take Back Day this SaturdayRead the Press Release
196 prescription take back locations across Michigan
Detroit – This Saturday, October 28, from 10 a.m. to 2 p.m. local time the federal Drug Enforcement Administration (DEA) and its local law enforcement, community and tribal partners will give the public its 14th opportunity in seven years to prevent pill abuse and theft by ridding their homes of potentially dangerous expired, unused, and unwanted prescription drugs.
Individuals can take pills and other solid forms of medication to one of almost 5,000 collection sites nationwide, and 196 sites in Michigan, manned by more than 4,000 partners nationwide. (DEA cannot accept liquids, needles or sharps.) They can find nearby collection sites at www.DEATakeBack.com or by calling 800-882-9539. The service is free and anonymous, no questions asked.
“Disposing of leftover painkillers or other addictive medicines in the house is one of the best ways to prevent a member of your family from becoming a victim of the opioid epidemic,” said DEA Acting Administrator Robert W. Patterson. “More people start down the path of addiction through the misuse of opioid prescription drugs than any other substance. The abuse of these prescription drugs has fueled the nation’s opioid epidemic, which has led to the largest rate of overdose deaths this country has ever seen.”
This initiative addresses a vital public safety and public health issue. Medicines that languish in home cabinets are highly susceptible to diversion, misuse, and abuse. Rates of prescription drug abuse in the U.S. are alarmingly high, as are the number of accidental poisonings and overdoses due to these drugs. Studies show that a majority of abused prescription drugs are obtained from family and friends, including from the home medicine cabinet. DEA launched its prescription drug take back program when both the Environmental Protection Agency and the Food and Drug Administration advised the public that their usual methods for disposing of unused medicines—flushing them down the toilet or throwing them in the trash—posed potential safety and health hazards.
Last April the public turned in 450 tons (900,000 pounds) of prescription drugs at almost 5,500 sites operated by the DEA and more than 4,200 of its state and local law enforcement partners. Overall, in its 13 previous Take Back events, DEA and its partners have taken in over 8.1 million pounds—more than 4,050 tons—of pills.
Pilot Sentenced for Operating Aircraft While Under the Influence of Alcohol at Cherry Capital AirportRead the Press Release
GRAND RAPIDS, MICHIGAN — Acting U.S. Attorney Andrew Birge announced today that Sean Michael Fitzgerald, 36, of Boca Raton, Florida, was sentenced by Chief U.S. District Judge Robert J. Jonker for operating a common carrier under the influence of alcohol. Fitzgerald will serve 12 months and 1 day confinement, 3 years of supervised release, and pay a $5,500 fine. Chief Judge Jonker commented that public deterrence is needed to remind the public and the flying community that this behavior is intolerable.
The evidence at trial established that on August 25, 2016, Fitzgerald arrived at the Cherry Capital Airport in Traverse City, Michigan, to co-pilot a private charter to Bedford, Massachusetts. On the way to the airport and once there, witnesses observed obvious signs of intoxication, including slurred speech, the smell of alcohol on his breath, and bloodshot eyes. Fitzgerald proceeded to the plane and began the pre-flight preparation process before he was arrested. Among other tasks, he inspected the plane, completed systems checks, turned on the auxiliary power unit, and received clearance for the flight’s route from air traffic control. After the arrest, his blood alcohol content was measured at 0.343%.
"Without prompt action by the pilot and airport personnel, this incident could have developed into a tragedy on the ground or in the air," Birge said. "I hope this sentence serves to deter pilots from showing up for work intoxicated and endangering all those who work at airports or fly for work or pleasure."
"The safety of commercial aviation is of utmost importance to the FBI and cannot be compromised. Today’s sentencing is a reminder that operating an aircraft while intoxicated endangers the public and can cause real life consequences," said David P. Gelios, Special Agent in Charge, Detroit Division of the FBI. "While troubling, this case does not reflect on the vast majority of flight crew professionals who conduct themselves in the best interest of public safety. It does reinforce the importance of how the public's vigilance can result in the protection of other people’s lives."
The FBI and the Traverse City Police Department investigated the case. Assistant U.S. Attorneys Clay M. West and Justin M. Presant prosecuted it.
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Feds Charge Grand Rapids Man with Student Loan and Grant FraudRead the Press Release
Grand Jury Says Brandon Kenon Rogers Defrauded Treasury of Nearly $150,000
GRAND RAPIDS, MICHIGAN — Acting U.S. Attorney Andrew Birge announced today that a federal grand jury has returned an indictment charging Brandon Kenon Rogers, 31, of Grand Rapids, with student loan and grant fraud. The grand jury charged Rogers with defrauding the U.S. Department of Education of approximately $150,000 in a wire fraud scheme and with committing aggravated identity theft as part of the scheme. Rogers surrendered himself to U.S. Marshals today and was released on bond after appearing before U.S. Magistrate Judge Ray Kent. U.S. District Judge Paul Maloney will handle further proceedings in the case.
The indictment alleges that Rogers defrauded the U.S. Department of Education by obtaining the identity information of others and posing as those individuals while applying online for Student Loans and Pell Grants in their names. He also enrolled online in local community colleges, including Grand Rapids Community College and Kalamazoo Valley Community College, using those same identities. Rogers was awarded loans and grants and allegedly used them for his own purposes without actually attending the classes as required.
Wire fraud carries a maximum possible penalty of 20 years in prison plus other penalties. Aggravated Identity Theft carries a mandatory two-year prison term, which must be served after the completion of any other sentence.
Acting U.S. Attorney Birge advised that: "These loan and grant programs are for students who want to better themselves with an education and obviously not for those who would take advantage to simply line their pockets. My office will not tolerate schemes like what we have alleged here."
The Grand Rapids Community College Department of Public Safety, the U.S. Department of Education, Office of Inspector General, the Federal Bureau of Investigation and the Internal Revenue Service investigated this case. Prosecution of the Rogers will be handled by Timothy VerHey, Assistant United States Attorney.
The charges in an indictment are merely accusations, and a defendant is presumed innocent until and unless proven guilty in a court of law.
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Kalamazoo Man Sentenced for Felon Firearm PossessionRead the Press Release
GRAND RAPIDS, MICHIGAN —Mosa Jamal Almahdi, 26, most recently of Kalamazoo, Michigan, was sentenced to 57 months’ of federal imprisonment by Chief U.S. District Judge Robert J. Jonker, after his guilty plea to being a convicted felon in possession of firearms, Acting U.S. Attorney Andrew Birge announced today. His sentence is to run consecutively to his current State of Michigan sentence for carrying a concealed weapon and assault with a dangerous weapon in an earlier incident. He will be under the supervision of the federal court for three years after he is released. He was also ordered to pay a fine of $15,000.
On June 25, 2015, hours after meeting with his State of Michigan probation officer following sentencing for his felony convictions in 9th Circuit Court, Kalamazoo, Michigan, Almahdi left his residence in Kalamazoo with two firearms, a Beretta 9mm semiautomatic pistol and a Remington .45 caliber semiautomatic pistol, intending to trade them for an AK-47 assault rifle. Almahdi was arrested en route to the prearranged location for the firearms exchange. At the sentencing hearing, Chief Judge Jonker described Almahdi’s actions as "brazen" and "egregious" in attempting to trade firearms to acquire an AK-47 so soon after sentencing on his state felony offenses and just four hours after his Michigan probation officer warned Almahdi that he was prohibited from owning or possessing firearms.
"Mosa Almahdi’s actions in possessing firearms and attempting to obtain another firearm shortly after his sentencing for a felony offense flouted both the law and his Michigan probation officer’s admonition," Acting U.S. Attorney Andrew Byerly Birge said. "The Court’s sentence is a message that the consequences are severe for convicted felons who violate federal firearms laws."
"The collaborative efforts of the FBI’s Kalamazoo Resident Agency and Kalamazoo Department of Public Safety in responding quickly to prevent Mr. Almahdi from obtaining an assault rifle is testament to the priority we place on keeping our communities safe. The public should know we will continue efforts to prevent gun offenses in the Western District of Michigan," said David P. Gelios, Special Agent in Charge, FBI Detroit.
The FBI and Kalamazoo Department of Public Safety investigated this offense. Assistant U.S. Attorney Clay M. West prosecuted the case.
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Battle Creek Man Sentenced to 30 Years in Federal Prison for Producing Child PornographyRead the Press Release
GRAND RAPIDS, MICHIGAN – Matthew John Andaluz, 44, of Battle Creek, Michigan was sentenced to 30 years in federal prison for producing child pornography, Acting U.S. Attorney Andrew Birge announced today. In addition to the prison term, Chief U.S. District Judge Robert J. Jonker imposed a 10-year term of supervised release that will commence once Andaluz is released from imprisonment. Andaluz will also be required to register as a sexual offender.
Andaluz pled guilty on June 7, 2017, and admitted that he had taken pornographic photographs of a ten-year-old child at his home in Calhoun County. He then circulated the images to others on the Internet. Copies of these images have been found in numerous other state and federal investigations throughout the United States. Federal agents traced these images back to Andaluz’s home late last year. Andaluz sexually abused the child repeatedly over a three-year period, created pictures of the abuse, and then distributed the pictures to others. The victim spoke at sentencing. She described the utter devastation that Andaluz caused to her life. She felt that she lost everything: her childhood, loved ones, and her home. She expressed her extraordinary pain, uncertainty, and anguish. The victim feared that she might never graduate from high school or ever be happy.
In its sentencing memorandum, the U.S. Attorney’s Office argued in favor of the thirty-year sentence. "Children are amongst the most vulnerable of victims, and [the victim in this case] was particularly vulnerable to the defendant . . . . The child will bear the emotional and psychological scars from the defendant’s abuse and exploitation her entire life. A 30-year sentence is needed to reflect the gravity and seriousness of the defendant’s crimes, to promote respect for the law, and to justly punish the defendant."
This case is part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. The U.S. Attorney's Office, county prosecutor's offices, the Internet Crimes Against Children task force (ICAC), federal, state, and local law enforcement are working closely together to locate, apprehend, and prosecute individuals who exploit children. The partners in Project Safe Childhood work to educate local communities about the dangers of online child exploitation, and to teach children how to protect themselves. For more information about Project Safe Childhood, please visit the following web site: www.projectsafechildhood.gov. Individuals with information or concerns about possible child exploitation should contact local law enforcement officials.
The Department of Homeland Security, Homeland Security Investigations (HSI) investigated the case. Assistant U.S. Attorney Sean M. Lewis prosecuted the case.
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Muskegon Man Sentenced to Five-And-A-Half Years in Federal Prison for Firearms OffenseRead the Press Release
GRAND RAPIDS, MICHIGAN – Gerald Fitzpatrick Odneal II, also known as "PJ," of Muskegon, Michigan was sentenced to 66 months (five-and-a-half years) in federal prison for possessing firearms as a convicted felon, Acting U.S. Attorney Andrew Byerly Birge announced today. In addition to the prison term, U.S. District Judge Janet T. Neff imposed a 3-year term of supervised release that will commence once Odneal is released from imprisonment.
In February of 2017, police were looking for Odneal in connection with an unrelated case. They located him near his home in Muskegon, but he fled from police, throwing a loaded .38 caliber Smith and Wesson revolver while in flight. Police recovered the weapon, but Odneal escaped. Police again located Odneal in April of 2017 and arrested him. Police recovered three additional firearms at the time of Odneal’s arrest, an SKS rifle, a stolen .40 caliber semiautomatic handgun, and a shortened (sawed-off) .22 caliber rifle. Odneal had taken a photo of himself brandishing one of the weapons, his fingerprint was on another, and he admitted to moving the third. Odneal had previously been convicted of being a Felon in Possession of a Firearm.
In its sentencing memorandum, the U.S. Attorney’s Office argued in favor of a significant custodial sentence, noting that Odneal "has a long history replete with violence and weapons offenses." In fact, "his most recent state-court conviction involving a running gun battle" in Muskegon. In light of his history, the U.S. Attorney’s Office argued that Odneal posed an immense risk to the community. "The Muskegon community suffers from gun violence, and there is a great need to deter such conduct by others. A significant sentence will tend to deter such conduct."
"While gun violence continues to be a problem that affects the safety and security of our neighborhoods, this sentence reflects the continuing impact that the Muskegon Violent Crime Task Force is having on the ability of those individuals who seek to threaten our communities", said Jeffrey R. Downey, Assistant Special Agent in Charge, Detroit Division of the FBI.
The charges in this case are the result of an investigation by the Muskegon Violent Crime Task Force, which includes the Federal Bureau of Investigation (FBI), the Michigan State Police (MSP), and the Muskegon City Police Department. The U.S. Attorney's Office, the Muskegon County Prosecutor's Office, and federal, state, and local law enforcement are working closely together to combat violent crime and drug trafficking in the Muskegon area. Assistant U.S. Attorney Sean M. Lewis prosecuted the case.
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Registered Sex Offender Sentenced to 60 Years in Prison for Enticement and Sexual Exploitation of A MinorRead the Press Release
GRAND RAPIDS, MICHIGAN –Justin Michael Walling, 28, of Lowell, Michigan was ordered to spend 60 years in federal prison for sexual offenses against a minor, Acting U.S. Attorney Andrew Birge announced today. In addition to the prison term, U.S. District Judge Paul Maloney ordered lifetime supervision for Walling after his release.
Walling has a long history of criminal sexual misconduct. In 2004, he had a juvenile adjudication for first-degree criminal sexual misconduct. In 2007, he pleaded guilty to two counts of attempted third-degree criminal sexual conduct with two victims who were 13 years old. In 2008, he violated probation when he was found associating with a 15 year-old girl. When arrested for the probation violation, police discovered that Walling possessed pornographic images of a 16 year-old girl that he met online. That conduct resulted in a conviction for possession of child pornography. He was sentenced to prison and released in August 2014. As a result of these convictions, Walling was required to register as a sex offender.
In July 2015, using a pseudonym of "Justin Blade,"Walling befriended a thirteen-year-old girl on Facebook. She told him she was underaged. He sent her nude photographs of himself and asked her for sexually explicit photographs. At trial, the child explained that she was lonely and wanted a friend; she thought doing these things would make Walling her friend. As requested, she sent him pornographic images of herself. Twice he drove to her town to pick her up and take her back to his residence in Lowell, where they had sex.
Walling was charged with two counts of enticement of a minor, one count of sexual exploitation of a minor, one count of receipt of child pornography, and one count imposing additional penalties for committing the crimes while registered as a sex offender. He went to trial and was convicted of all counts on April 24, 2017.
Judge Maloney stated that the sentence imposed was necessary to protect the public because Walling is a predator who exploited a very vulnerable victim, who was under the age of consent. The Court emphasized that though it might be hard for the victim to put this behind her, "her voice has been heard."
"Today’s sentence effectively ends Justin Walling’s ability to sexually exploit children and underscores the commitment of the FBI, the West Michigan Based Child Exploitation Task Force (WEBCHEX) and the Ionia County Sheriff’s Office to protecting our vulnerable youth against sexual predators," said David P. Gelios, Special Agent in Charge, Detroit Division of the FBI.
The FBI’s West Michigan Based Child Exploitation Task Force and the Ionia County Sheriff’s Office investigated the case. Assistant U.S. Attorney Alexis M. Sanford prosecuted and tried the case.
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Okemos Woman Guilty of Defrauding the U.S. Treasury of over $3.6 Million Sentenced to 10 Years in PrisonRead the Press Release
Investigators Recover Over $1.5 Million in Fraud Proceeds
GRAND RAPIDS, MICHIGAN — Callista Suzena Chiwocha, of Okemos, Michigan was sentenced in U.S. District Court to ten years in prison for conspiring to defraud the government by filing false tax returns, announced Acting U.S. Attorney Andrew Birge. The ten-year prison sentence imposed by Chief U.S. District Judge Robert J. Jonker was the maximum penalty available. Callista Chiwocha was also ordered to pay full restitution in the amount of $3,627,401.16 to the Internal Revenue Service. Callista Chiwocha, her husband, Tapera Albert Chiwocha, Sr., and their company, Human Services Associates, LLC pled guilty in March 2017. Tapera Albert Chiwocha, Sr. passed away in July 2017 pending sentencing. The Court also ordered Human Services Associates, LLC, which Callista Chiwocha attempted to dissolve while the federal investigation was pending, to pay full restitution.
Over approximately ten months during 2011, Callista Chiwocha, age 64, and her husband, Tapera Albert Chiwocha, Sr., age 75, requested over $4.5 million in federal tax refunds from the United States Treasury by causing 3,228 false tax returns to be filed on behalf of others with the Internal Revenue Service. The Chiwochas and those who worked for them at Human Services Associates, LLC tricked individuals into providing their personal identification information after being promised "free stimulus money." The tax returns typically contained false reporting of undocumented income and abusive use of the earned income credit. The Chiwochas’ scam preyed on the poorest and most vulnerable citizens of the district. The Chiwochas created Human Services Associates, LLC to facilitate and conceal their criminal activities. Before perpetrating the fraud, Callista Chiwocha had prior work experience in the banking industry and the tax return preparation industry.
Acting U.S. Attorney Birge commented: "When you steal from the U.S. Treasury, you steal from your neighbor. The Chiwochas and Human Services Associates, LLC pillaged the U.S. Treasury for a period of ten months in 2011 and reaped an enormous amount of illegitimate refund money – over $3.6 million – in the process. Their crime was brazen and outrageous and is the very type of crime that breeds cynicism about our tax system, which relies upon honest and voluntary compliance. The statutory maximum sentence the U.S. District Court imposed on Ms. Chiwocha should send a stern message to the public that tax refund fraud will not be tolerated in this District."
When issuing the sentence, Chief U.S. District Judge Jonker stated: "This may have been Ms. Chiwocha’s first experience breaking the law, but she did it in a big way." Jonker also acknowledged Callista Chiwocha’s prior work experience in the banking and tax return preparation industries and noted that the knowledge she gained from this work experience undoubtedly helped her facilitate the scheme. Callista Chiwocha obtained an undergraduate business degree in accounting from the University of Michigan in 1978. Investigative records show that shortly before starting the tax fraud scheme, the Chiwochas were delinquent on their home mortgage payments and had been frequenting casinos.
Complaints by local citizens prompted the Federal Bureau of Investigation and the Internal Revenue Service Criminal Investigation to open an investigation in 2011, which began with the execution of search warrants at the Chiwochas’ home and places of business. In 2011, investigators also seized the contents of over twenty bank accounts traced to the scheme, additional cash, and four vehicles that the Chiwochas and their associates had purchased with illegitimate tax refund money. The seizures in 2011 led to the recovery of over $1.5 million in fraud proceeds through civil forfeiture proceedings. In the near future, the U.S. Attorney’s Office will be processing paperwork to restore the recovered fraud proceeds to the U.S. Treasury.
Callista Chiwocha’s and Human Services Associates, LLC’s sentencings were the culmination of six years’ worth of work by investigators and prosecutors. In earlier prosecutions, other Chiwocha-related family members pled guilty to similar tax offenses: daughter Takabvako Chiwocha-Crowell pled guilty to filing false tax returns and was sentenced to 42 months’ incarceration; daughter Tsiidzoyedu Callista Chiwocha pled guilty to filing false tax returns and was sentenced to one year and one day of incarceration; grandson Qasim Ibn-Ishaq Verser pled guilty to filing false tax returns and was sentenced to 36 months’ incarceration; grandson Imran Dawood Ibn-Abdurrahim pled guilty to filing false tax returns and was sentenced to 54 months’ incarceration; and, granddaughter Ruqayya Aida Abdul-Hakim pled guilty to filing false tax returns and was sentenced to 72 months’ incarceration. The Chiwochas’ tax refund fraud scheme was an extended family enterprise.
IRS Criminal Investigation Special Agent in Charge Many Muriel stated: "This case demonstrates IRS-CI’s ability to find individuals who cheat the Internal Revenue Service. In this particularly disturbing case, the defendant preyed on the most vulnerable citizens and filed false tax returns using their information. Because of her greed, Calista Suzena Chiwocha scammed the public and the IRS, all in efforts to enrich herself. This sentencing demonstrates the IRS’s and the U.S. Government’s commitment to bring to justice those who commit these and other egregious crimes."
David P. Gelios, Special Agent in Charge of the FBI said, "During the majority of 2011, Human Services Associates, LLC and the Chiwochas stole tax refund money from the U.S. Treasury, eroding trust in the tax system. Today’s maximum sentence sends a clear message to the public that federal law enforcement at all levels will continue to work to hold those defrauding the U.S. government accountable for their criminal acts."
This case was prosecuted by Assistant U.S. Attorneys Joel S. Fauson and Michael A. MacDonald.
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Chief Executive Sent to Prison and Ordered to Pay Back Nearly Two Million Dollars to the IRS for Tax OffenseRead the Press Release
Defendant was formerly CEO of Michigan BioDiesel
GRAND RAPIDS, MICHIGAN — Defendant John Gerald Oakley, age 66, was sentenced to a year and a day in prison based on his guilty plea to two counts of federal tax evasion, Acting U.S. Attorney Andrew Birge announced today. Oakley, a resident of Dimondale, Michigan, was formerly the Chief Executive Officer of Michigan BioDiesel, a company based in Bangor, Michigan. Michigan Biodiesel claimed it was producing “an alternative fuel mixture,” which allegedly qualified as an excise tax-exempt fuel. Oakley was also ordered to pay back $1,923,443.50 to the Internal Revenue Service. The restitution money includes $1,867,122.50 of tax refunds improperly sent to Michigan BioDiesel and approximately $56,000 in personal federal taxes owed by Oakley.
Acting U.S. Attorney Birge emphasized that his office will zealously prosecute crimes against the United States Treasury. “Cheating on your taxes is stealing from your neighbors.”
A co-defendant, Tracy Darin Daniels, a 50-year-old resident of Mississippi, was sentenced to two years of probation based on his plea of guilty to misprision of a bankruptcy fraud. Daniels provided false documents to co-defendant Oakley, who then submitted them in a United States Bankruptcy Court case in the Western District of Michigan.
This matter was handled by Assistant U.S. Attorneys Michael A. MacDonald, Sally J. Berens, and Hagen W. Frank.
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18 Defendants Facing Federal Charges for Drug TraffickingRead the Press Release
AGENTS SEIZE OVER 30 KILOGRAMS OF DRUGS AND APPROXIMATELY A MILLION DOLLARS ONE DEFENDANT SHOT DURING TAKE DOWN
GRAND RAPIDS, MICHIGAN – Acting U.S. Attorney Andrew Birge announced that his office sought, and U.S. Magistrate Judge Phillip J. Green issued last Friday and earlier today, arrest warrants for eighteen separate defendants charged by criminal complaint with conspiring to distribute heroin and cocaine in the areas of Grand Rapids and Benton Harbor, Michigan. The affidavit filed in support of the complaint alleges that the drugs were trafficked into West Michigan by semi-tractor trailer from California.
During the arrests of the defendants and execution of associated searches, federal, state and local investigators seized over 30 kilograms of heroin and cocaine, multiple pounds of marijuana, two kilogram presses, approximately $1,000,000, a bullet-proof vest, three handguns and an assault rifle with an extended magazine. One defendant suffered a gunshot wound in the course of the execution of the arrests and searches. He will appear for proceedings as his condition allows.
Further details of the allegations may be found in the attached complaint and 185-page supporting affidavit, which were unsealed at the initial appearance of eleven of the defendants today. A twelfth defendant, Phillip Nelson, made his initial appearance in Chicago, in the Northern District of Illinois.
The charges are the result of a multi-agency Federal, State and local law enforcement investigation into the conspiracy. The Drug Enforcement Administration (DEA), Internal Revenue Service (IRS), Federal Bureau of Investigation (FBI), Vice Unit of the Grand Rapids Police Department (GRPD), Kent County Sheriff’s Department (KCSD), Wyoming Police Department, Michigan State Police (MSP), Kent Area Narcotics Enforcement Team (KANET), Metropolitan Enforcement Team (MET), U.S. Secret Service (USSS), Bureau of Alcohol Tobacco and Firearms (ATF), Kalamazoo Valley Enforcement Team (KVET), Albion P.D., Calhoun County Sheriff Department, and South West Enforcement Team (SWET) have all supported the investigation.
The charges in the complaint, which carry varying maximum penalties of up to 20 years or life in prison, depending on the allegations against the individual defendant, are merely accusations and are not evidence of guilt. The defendants are presumed innocent unless and until proven guilty in a court of law. The government has the burden of proving guilt beyond a reasonable doubt.
The image below shows items recovered through the law enforcement operation.
The complaint charges the following individuals: Name
Age
Residence
YUSEF LATEEF PHILLIPS, aka "Sef"
40
Grand Rapids, MI
RAY ANTHONY LEE, aka "Rudy Ray"
46
Grand Rapids, MI
DEMETRIUS DEWAYNE GAINES
41
Wyoming, MI
CAZEMBIE SOKONI BASKIN, aka "Doe-Boy"
44
Grand Rapids, MI
JESSE MARTELL PHILLIPS
34
Previously in custody
RETISHA MAE PEGRAM, aka "Blackie"
36
Grand Rapids, MI
PHILLIP NELSON
39
Chicago, IL
BRANDON KENYEN PARKS
27
Grand Rapids, MI
MICHAEL YADELL NELSON
37
Grand Rapids, MI
MICHAEL GOULD
36
Grandville, MI
KAYODE MOYO-JOMOKE MARSHALL
42
Grand Rapids, MI
SOLON TATUM
40
Grand Rapids, MI
TONY KIRKLAND
55
Kentwood, MI
The DEA requests the public’s assistance in locating the following defendants charged with conspiracy to distribute controlled substances:
Pictures of fugitives Demetrius Gaines, Retisha Pegram, Brandon Parks, and Etrevion MurphyTexas Man Receives 87 Months' Imprisonment for Trafficking Cocaine in Muskegon and Oceana CountiesRead the Press Release
Other two coconspirators also receive lengthy prison sentences
GRAND RAPIDS, MICHIGAN —Acting U.S. Attorney Andrew Birge announced today that U.S. District Judge Janet T. Neff sentenced Jaime Valente Pina, Jr. of Alamo, Texas to 87 months’ in prison for participating in a cocaine distribution conspiracy that operated in and around Muskegon and Oceana counties from the summer of 2015 until August 2016. In addition to his prison term, the Court sentenced him to three years of supervised release. Pina was convicted on May 10, 2017 after a three day jury trial.
The conspiracy began in the summer of 2015 when Magdaleno Rodriguez, a cocaine dealer operating in and around Oceana County, was introduced to Jaime Valente Pina, Jr. as a new source of supply for cocaine. Thereafter, Jaime Pina and his brother, Angel Pina, supplied cocaine to Rodriguez on a monthly basis for further redistribution throughout West Michigan. The Pina brothers are from the Rio Grande Valley – the southernmost tip of Texas – which shares an extensive stretch of border with Mexico. Throughout the conspiracy, they brought cocaine to Rodriguez from their Texas-based source of supply. The conspiracy ended in approximately August 2016 after officers of the State, Sheriffs, Chiefs, Enforcement Narcotics Team (SSCENT) concluded undercover buys from Rodriguez and executed a search warrant at his home. Officers of the West Michigan Enforcement Team (WEMET) apprehended the Pina brothers while executing a warrant at a drug house in Ravenna, Michigan in November 2016.
Magdaleno Rodriguez and Angel Pina pled guilty prior to trial. Rodriguez and Angel Pina were sentenced in U.S. District Court on July 11, 2017. The Court sentenced Rodriguez to 98 months’ incarceration and four years of supervised release. Angel Pina received 109 months’ incarceration and three years of supervised release.
Acting U.S. Attorney Birge stated: "The interstate trafficking of controlled substances into the Western District of Michigan remains a key prosecution priority for my office. Controlled substances poison our communities and they impair and often destroy the potential of those who use them. Individuals involved with importing these toxic substances into the Western District of Michigan will be brought to justice."
"The sentencing of this final defendant brings full resolution to this investigation and chokes off a drug tracking organization responsible for distributing cocaine in our communities," said Steve Francis, HSI Detroit special agent in charge. "HSI will continue to use its vast resources to combat the spread of illegal drugs."
"This is yet another great example of the cooperative law enforcement efforts that occur daily in west Michigan. The agencies involved in this case worked diligently to ensure justice was served," stated Detective/First Lieutenant Andy Fias, the Section Commander of WEMET and SSCENT.
Homeland Security Investigations, an investigative arm of the Department of Homeland Security, led the investigation with the assistance of SSCENT and WEMET. SSCENT and WEMET are two state-managed multijurisdictional drug task forces. Assistant U.S. Attorneys Joel S. Fauson and Timothy P. VerHey prosecuted this case.
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19 Defendants Facing Federal Criminal Charges for Alledgedly Defrauding Bank of America in Bank Card SchemeRead the Press Release
GRAND RAPIDS, MICHIGAN—Nineteen defendants residing in Michigan, Illinois, and Georgia have been charged by a federal Grand Jury with conspiracy to commit bank fraud and executing a scheme to defraud Bank of America, Acting U.S. Attorney Andrew Birge announced today. Special Agents of the Federal Bureau of Investigation (FBI), assisted by the U.S. Postal Inspection Service in Chicago, the Kalamazoo Department of Public Safety, and several state law enforcement officers assigned to the FBI’s Grand Rapids Violent Crime and Fugitive Task Force, Muskegon Safe Streets Task Force, and St. Joseph Violent Crime Task Force, began arresting the defendants yesterday.
The 28-count indictment alleges that, since at least November 2015 to December 2015, the defendants conspired with each other to open bank accounts at Bank of America to facilitate the deposit of fraudulent checks. Once a fraudulent check was deposited into an account and the bank temporarily credited the account with funds, the accountholder and others allegedly used a debit card associated with the account to obtain, and attempt to obtain, money and funds belonging to Bank of America. The charges allege that the defendants conducted numerous cash withdrawals at ATM machines and bank branches, and conducted cash advance transactions at FireKeepers Casino near Battle Creek, Michigan, to unlawfully obtain money belonging to the bank. As a result, the defendants allegedly caused a loss of more than $200,000 to Bank of America. Law enforcement refers to this type of bank fraud scheme as "Cracking Cards."
The charges in an indictment, which carry a maximum penalty of 30 years in prison, are merely accusations and are not evidence of guilt. The defendants are presumed innocent unless and until proven guilty in a court of law. The government has the burden of proving guilt beyond a reasonable doubt.
This matter is being investigated by the FBI and the U.S. Postal Inspection Service with assistance from the Nottawaseppi Huron Band of Potawatomi Tribal Police Department. The criminal case is being prosecuted by Assistant U.S. Attorneys Kate Zell and Christopher O’Connor.
The FBI requests the public’s assistance in locating the following defendants charged with conspiracy to commit bank fraud and executing a scheme to defraud a federally-insured financial institution:
Tirell Perry Thomas Jerome Datra Perry Dwayne Edward PerryAnyone with information related to the whereabouts of any of those individuals is encouraged to call the FBI Detroit Office at 313-965-2323.
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Armed Bank Robber from Grand Rapids Sentenced to 14 Years in PrisonRead the Press Release
GRAND RAPIDS, MICHIGAN - Joseph Allen Ellsworth, 32, of Grand Rapids, Michigan, was ordered to serve 14 years in federal prison for bank robbery, Acting U.S. Attorney Andrew Birge announced today. In addition to the prison term, U.S. District Judge Paul Maloney ordered Ellsworth to serve four years of supervised release following his release from prison, and pay restitution of $7,318.
On July 20, 2016, at about 2:00 pm, Ellsworth wore an orange ski mask, entered the Fifth Third Bank on 54th street in Wyoming, Michigan, racked what appeared to be a semi-automatic pistol, pointed it at a teller, and demanded money.
Ellsworth made off with $7,318. Hidden in the cash was a dye pack. Ellsworth left by foot and ran west to the Inter-Urban Trail, where he recovered a bike and rode south. During their search, police eventually saw Ellsworth, causing him to drop the bike to the ground and flee into nearby woods. Police recovered the bike, which was stained from the dye pack and had Ellsworth’s DNA on its handlebars. A subsequent search of Ellsworth’s phone revealed pictures of dye-stained money.
The U.S. Attorney’s office pursued charges against Ellsworth with the July 20th robbery as well as a robbery committed in an identical fashion at the same bank nine days earlier. On April 6, 2017, a jury convicted Ellsworth of the July 20th robbery but acquitted on the earlier offense.
One of the three victimized tellers spoke at Ellsworth’s sentencing saying, "I know I will forever struggle with the emotional and mental effects of these crimes. I am not sure I will ever fully recover." The victim teller went on to detail that she initially moved away from the Grand Rapids area due to the fear the robbery instilled in her. However, she also hoped to turn that fear around and use it to help other bank robbery victims: "I do hope that one day I can use my traumatic experiences to help others who were unwillingly put in a situation like I was."
Judge Maloney stated that the 14-year sentence was necessary to reflect the impact Ellsworth’s actions had on the victim tellers, and to deter Ellsworth and others from committing similar crimes. Judge Maloney also noted that Ellsworth repeatedly took advantage of others to get what he wanted, and that Ellsworth committed three home invasions in the period leading up to the bank robbery.
The Wyoming Police Department investigated the case with assistance from the Federal Bureau of Investigation. Assistant U.S. Attorneys Davin M. Reust and Timothy P. VerHey prosecuted and tried the case.
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Naturalized U.S. Citizen from Bosnia Guilty of Fraudulently Obtaining CitizenshipRead the Press Release
Charged with having obtained citizenship by telling a series of lies in naturalization process, Defendant admits that he intentionally failed to disclose murder charges during 1990’s Bosnian Conflict
GRAND RAPIDS, MICHIGAN — Alexander KNEGINICH, 57, of Crown Point, Indiana, was convicted on August 18, 2017, of having fraudulently obtained his U.S. citizenship by falsely denying, during the immigration and naturalization process, that he had ever been charged with or jailed for a crime. During a guilty-plea hearing conducted earlier in August, KNEGINICH admitted under oath that he had repeatedly claimed never to have been charged with a crime or held in custody, when in fact he had been charged with the 1994 murders of two Muslim civilians – a husband and wife – while serving in a Serbian militia unit during the 1990’s Bosnian conflict. Those charges remain pending in Bosnia-Herzegovina, which is actively seeking KNEGINICH’s extradition for trial. KNEGINICH told these lies to U.S. immigration authorities in the course of obtaining authority to enter the United States as a refugee, subsequently obtaining permanentresident status, and ultimately obtaining U.S. citizenship in January 2007 in Grand Rapids, Michigan.
“Mr. Kneginich never rightly secured the blessings and freedom of citizenship and lawful status in this great country of ours,” said Acting U.S. Attorney Andrew B. Birge. “He snuck into this country by fleeing charges that he is a murderer. For his deceit, he faces the irony of up to ten years behind locked, iron doors before the process for sending him back even begins.”
“The United States will never be a safe haven for those seeking to distance themselves from their past,” said Special-Agent-in-Charge Steve Francis, Homeland Security Investigations, Detroit Field Office (HSI). “This conviction now paves the way for Mr. Kneginich's ultimate removal from the United States.”
KNEGINICH’s sentencing is scheduled for November 14, 2017, in front of U.S. District Judge Janet T. Neff. KNEGINICH faces up to ten years in federal prison; in addition, revocation of his U.S. citizenship is mandated by Federal law based on the conviction. KNEGINICH also faces eventual deportation and/or extradition back to Bosnia and Herzegovina, where murder charges remain pending. KNEGINICH remains in the custody of the U.S. Marshal’s Service pending his sentencing.
The case is being jointly prosecuted by Trial Attorney Jamie Perry, of the Justice Department’s Human Rights and Special Prosecutions Section (HRSP), and Assistant U.S. Attorney Hagen W. Frank of the U.S. Attorney’s Office, Western District of Michigan. The case was investigated by HSI’s Grand Rapids Office, assisted by the Justice Department’s Office of International Affairs and the Government of Bosnia and Herzegovina.
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Battle Creek Hotel Owner Ordered to Pay Restitution of $150,500 to EmployeesRead the Press Release
GRAND RAPIDS, MICHIGAN — Acting U.S. Attorney Andrew Birge announced today that Mehul Chandubhai Patel, a/k/a "Mike Patel," 31, of Battle Creek, Michigan, was ordered to pay restitution of $150,500 to his former employees. The restitution order is the last stage of Patel’s sentence for lying to Labor Department investigators during their probe into his violation of minimum wage laws while operating two hotels operated by him, in Battle Creek and Coldwater, Michigan. Patel is currently serving a 60-day sentence imposed in U.S. District Court on May 24, 2017 for the offense.
On February 2, 2017, Patel appeared in federal court and pled guilty to violating 18 U.S.C. 1001(a)(1), a federal statute that prohibits anyone from concealing a material fact from the federal government when obligated to disclose it. He admitted that during 2005, the Department of Labor ("DOL") had found him to be in violation of minimum wage laws by underpaying his hotel employees. He thereafter signed an agreement promising to repay his employees. When requested to provide proof that he had done so, Patel sent DOL checks indicating that back wages had been repaid. However, he concealed the fact that he required his employees to return the money to him immediately after cashing them.
U.S. District Judge Paul Maloney delayed imposing restitution at the sentencing hearing, advising the parties that he would decide the matter in August if they could not reach an agreement on the amount of restitution. On August 18, 2017, the U.S. Attorney’s Office reached an agreement with Patel that he would immediately pay $150,500 to the Department of Labor, for disbursement to his former employees. This will result in no further action against him for back wages, either in criminal or civil court.
Acting U.S. Attorney Birge commented that "Putting Patel in jail for cheating his financially distressed employees was important, but so is making sure they are paid what they are owed. This settlement allows them to be repaid right away, rather than waiting months or years." Birge praised the help provided by the Chicago Office of the Department of Labor for its help in reaching a settlement that satisfied both criminal restitution and civil damages issues.
Prosecution of the matter was assigned to Timothy VerHey, Assistant U.S. Attorney. The matter was investigated by the US Department of Labor, Office of Inspector General, Homeland Security Investigations, and the Battle Creek Police Department.
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Leaders of Staged Automobile Accident Fraud Conspiracy SentencedRead the Press Release
Florida Residents were Convicted by a Federal Jury in March of this Year
GRAND RAPIDS, MICHIGAN —Belkis Soca-Fernandez, 47, and David Sosa-Baladron, 42, of Tampa, Florida, were sentenced to prison in federal court yesterday. A federal jury convicted Soca-Fernandez and Sosa-Baladron in March of this year of health care fraud and conspiracy to commit mail fraud related to a staged automobile accident ring that operated in West Michigan from 2012 to 2015. United States District Judge Paul L. Maloney sentenced Soca-Fernandez to 135 months in prison and Sosa-Baladron to 120 months in prison. When imposing the sentence, Judge Maloney commented that the conduct of the defendants was "an attack on the no-fault automobile insurance system in the state of Michigan that is reliant upon the truth of the claims made." He further commented that the defendants’ scheme was a "brazen scheme of the first order." The court also ordered the defendants to pay restitution of $675,066.96 to the automobile insurance companies that were defrauded.
"This staged automobile accident ring operated a sophisticated fraud over several years in our community," stated Acting U.S. Attorney Andrew Byerly Birge. "The very significant sentences imposed by the court reflect the leadership roles played by Soca-Fernandez and Sosa-Baladron and the fact that they greatly profited from this fraud scheme at the expense of Michigan’s automobile insurance system. My office will continue to vigorously prosecute those who cheat our financial and insurance programs."
The staged automobile accident ring operated three therapy clinics, Revive Therapy Center and HH Rehab Center, in Wyoming, Michigan, and Renue Therapy Center in Lansing, Michigan, from April 2012 to May 2015. The ring recruited and paid cash to individuals to stage automobile accidents and obtain police reports so that insurance claims could be made with their automobile insurance companies. The managers of the clinics and others working with them then told the accident participants what symptoms to present to a physician affiliated with the ring so that she would sign a prescription for physical therapy. The accident participants would then seek unnecessary therapy treatment at the clinics. Typically, after a few therapy sessions, the accident participants would sign blank therapy treatment forms that would be signed by massage therapists to make it appear as if the accident participants were obtaining treatment when they truly were not. The therapy clinics then used the treatment forms to send false insurance claims through the United States mail to automobile insurance companies for therapy treatment that was either not necessary or not actually provided.
"Elaborate insurance fraud schemes like the one perpetrated in this case disrupt the economy and cause law-abiding citizens to pay more for their coverage," said HSI Special Agent in Charge Steve Francis. "HSI is committed to working with our law enforcement partners to bring down organized criminals that have no concern for the law or their affected victims."
"To those that conspire to defraud insurance companies in Michigan, the sentencing of these defendants in this complex staged auto accident scheme should clearly demonstrate that the FBI routinely tracks, identifies, and brings to justice criminals who engage in fraudulent conduct which drives up insurance rates and health care costs for everyone", said David P. Gelios, Special Agent in Charge, Detroit Division of the FBI. "Similarly, the successful collaboration among Homeland Security Investigations, the FBI and the U.S. Attorney's Office is the norm today as law enforcement at every level is more determined than ever to hold unethical individuals accountable for their illegal conduct."
Soca-Fernandez and Sosa-Baladron are the latest of eight individuals sentenced for their role in the staged automobile accident fraud conspiracy. Previously sentenced were:
• Antonio Ramon Martinez-Lopez, 35, Tampa, Florida, manager of Revive Therapy (87 months’ imprisonment)
• Gustavo Acuna-Rosa, 30, Versailles, Kentucky, manager of Renue Therapy (32 months’ imprisonment)
• Yoisler Herrera-Enriquez, 31, Wyoming, Michigan, manager and massage therapist, H&H Rehab (57 months’ imprisonment)
• Eduardo Pardo-Oiz, 35, Nashville, Tennessee, recruiter and accident participant (2 months’ imprisonment)
• Dolis Rojas-Lopez, 31, Wyoming, Michigan, recruiter and accident participant (3 years’ probation)
• Yosvany Gonzalez-Duran, 42, Lansing, Michigan, recruiter and accident participant (1 year probation)
The Department of Homeland Security, Homeland Security Investigations, and the Federal Bureau of Investigation, in Grand Rapids, Michigan, conducted the investigation of the case. Assistant United States Attorneys Ronald M. Stella and Timothy VerHey handled the prosecution and trial.
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Career Bank Robber Sentenced to 151 Months in Federal PrisonRead the Press Release
KALAMAZOO, MICHIGAN — U.S. District Judge Paul L. Maloney sentenced Edward Lucas, 37, of South Haven, Michigan, to 151 months in federal prison, Acting U.S. Attorney Andrew Birge announced today. Judge Maloney also ordered Lucas to serve three years of supervised release following his release from prison and pay a special assessment of $100.
On August 18, 2016, Edward Lucas robbed the Independent Bank of Sand Lake, Michigan. Lucas handed a manila envelope to a teller with these words on it: "This is a Robbery. 100s, 50s, 20s. No die packs." The teller gave Lucas $5,550, and he fled in a silver Chevy Impala. Twenty minutes later, a Kent County Sheriff’s Officer observed Lucas in a vehicle matching the description from the robbery. The officer attempted to stop the Impala, but Lucas led the officer on a high-speed chase, with speeds exceeding 90 mph. During the chase, Lucas ran head-on into an oncoming vehicle, which caused his vehicle to flip and roll several times. Responding officers pulled Lucas from the burning vehicle. Officers extinguished the fire and in the vehicle found the demand note and $5,550 in cash. Lucas previously was convicted of committing two bank robberies in 1999.
Judge Maloney noted that Lucas seriously risked the lives of others in fleeing from the robbery. Judge Maloney also noted Lucas had a high risk of returning to bank robbery someday, given that he had two prior bank robbery convictions in Michigan state courts.
The Kent County Sheriff’s Office, Michigan State Police, and Federal Bureau of Investigation jointly investigated Lucas’s case. Assistant U.S. Attorney Davin M. Reust prosecuted it.
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Man Who Started Shootout Leading to Friend's Death Sentenced to 100 Months' ImprisonmentRead the Press Release
GRAND RAPIDS, MICHIGAN —Chief U.S. District Judge Robert J. Jonker sentenced 24-year-old Demetrius Viney, Jr. of Holland, Michigan to 100 months’ imprisonment for being a felon in possession of a firearm, Acting U.S. Attorney Andrew Byerly Birge announced today. Judge Jonker also ordered Viney to serve three years of supervised release, forfeit the firearm, and pay a $1,200 fine.
Viney’s possession of the firearm resulted in a fatal shooting in the early morning hours of September 11, 2016 when he used it to shoot at a rival in the parking lot of the Hookah Lounge in Holland. The resulting shootout resulted in the death of Viney’s friend, Anthony Lamb.
The Court held that Viney’s actions in initiating the gunfire constituted attempted second-degree murder and were deserving of an enhanced sentence. The Government sought the attempted second-degree murder finding in its sentencing memorandum by pointing out that Viney "repeatedly threatened [his rival], pulled a firearm on him, pointed it at him, and shot."
"Instead of becoming a law-abiding citizen, Demetrius Viney, Jr. chose to continue a life of crime and it led to the death of his friend," said Thomas Chittum, Acting Special Agent in Charge of the Bureau of Alcohol, Tobacco, and Firearms. "His lengthy prison sentence should serve as a warning to others who might consider making similar poor choices."
The Ottawa County Sheriff’s Office and ATF jointly investigated this case. Assistant U.S. Attorney Davin Reust prosecuted Viney’s federal case. The Ottawa County Prosecutor brought charges against others involved in the fatal shooting, some of which are still pending final resolution.
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Kalamazoo Man Sentenced to 8 Years for Stolen FirearmsRead the Press Release
Keondre McNeely is the sixth defendant sentenced in connection with firearms stolen from Outpost Guns
GRAND RAPIDS, MICHIGAN — Twenty-seven-year-old Keondre McNeely, of Kalamazoo, Michigan, was sentenced to 96 months in prison for possessing a stolen firearm, Acting U.S. Attorney Andrew Birge announced today. Along with codefendants Jorel Gefferard and Roscoe Manns, Keondre McNeely played a central role in transporting and trafficking 21 firearms that were stolen in November 2015 from Outpost Guns, a federally licensed firearms dealer (FFL) in Sturgis, Michigan. Of those 21 firearms, thirteen were assault rifles with large-capacity magazines.
In announcing the sentence, the Honorable Robert J. Jonker, Chief Judge of the U.S. District Court for the Western District of Michigan, noted that the defendant was a "key conduit" for putting the stolen firearms into circulation. Although the defendant had a limited criminal history, with no prior felony convictions, the Court emphasized the seriousness of the defendant’s conduct; by his involvement in moving and trafficking the stolen firearms, the defendant put a lot of people "in harm’s way."
In total, six people have been sentenced for their role in the theft, trafficking, or possession of firearms stolen from Outpost Guns:
Kenneth Williams, of Kalamazoo, was sentenced to 96 months in prison, following his conviction for possessing one of the Outpost Guns firearms as a previously convicted felon;
Jorel Gefferard, of Sturgis, was sentenced to 84 months in prison, following his conviction for stealing the firearms from Outpost Guns;
Ronald Dafney, of Kalamazoo, was sentenced to 72 months in prison, following his conviction for possessing one of the Outpost Guns firearms as a previously convicted felon;
Kevonte McNeely, of Kalamazoo, was sentenced to 60 months in prison, following his conviction for possessing one of the Outpost Guns firearms as a previously convicted felon;
Roscoe Manns, of Sturgis, was sentenced to 54 months in prison, following his conviction for his possession of firearms stolen from Outpost Guns.
Acting U.S. Attorney Birge commented that: "The U.S. Attorney’s Office is committed to investigating and prosecuting every link in the chain that leads to stolen guns on our streets—from those who steal from gun stores in the first place, to those who help conceal and move stolen firearms, to the sellers of stolen guns, and to the buyers." Stolen firearms are, by nature, crime guns, and they typically end up in the hands of people with criminal records, who are themselves prohibited from buying guns. "Keondre McNeely and his codefendants put 21 stolen guns on the street and there is no telling when one or more of those firearms might be used in a violent way. If you steal guns from an FFL, if you sell stolen guns, or if you buy or possess a stolen gun, this Office is going to do what it can to ensure a lengthy prison term that reflects the seriousness and dangerousness of these crimes."
"Stolen guns are being used in violent crimes that destroy not only families, but the fabric of our communities," said interim Special Agent in Charge Thomas Chittum. "ATF will use the full scope of our resources to find those responsible for the theft and trafficking of illegal firearms so they can be prosecuted to the fullest extent of the law."
The Sturgis Police Department, the Kalamazoo Department of Public Safety, and the ATF investigated the case. Assistant U.S. Attorney Kate Zell prosecuted the case.
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Grand Rapids Bar Owner Sentenced to 18 Months for Obstructing an Internal Revenue Service AuditRead the Press Release
GRAND RAPIDS, MICHIGAN. – Michael Farah, 70, of Grand Rapids, Michigan, was sentenced to 18 months in federal prison, Acting U.S. Attorney Andrew Byerly Birge announced today. U.S.District Judge Paul A. Maloney imposed the sentence. In addition to the prison term, Farah was also ordered to serve a year of supervised release, pay a fine of $5,000, and pay restitution of $221,730.25.
Michael Farah and his son Brian skimmed cash from their Grand Rapids-area bars in 2013 and 2014, which they did not report on their business or individual tax returns. When they received notice of an Internal Revenue Service audit in August 2015, they tried to conceal their tax fraud by destroying all of their computerized point of sale records. They were caught when the company that maintained their business’s computerized sales records provided the Internal Revenue Service with recordings of the Farahs’ phone calls seeking assistance with the deletion of those records.
Judge Maloney said that Michael Farah “brazenly lied and destroyed records in an attempt to cover up his tax fraud.” The restitution amount, which Michael Farah has already paid, included $126,703.00 in federal taxes that he owed for the cash he skimmed from the bars in 2013 and 2014, plus $95,027.25 in penalties and interest. Michael Farah’s son Brian Farah was previously sentenced to 13 months in federal prison for his role in the crime.
“Michael Farah intentionally destroyed his records to avoid an IRS audit,” said IRS Criminal Investigation Special Agent in Charge Manny Muriel. “This sentence should serve as a deterrent to those who might contemplate similar fraudulent actions.”
This case was investigated by the Internal Revenue Service. It was prosecuted by Assistant U.S. Attorney Clay Stiffler.
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Coopersville Man Sentenced to Prison in Scheme to Defraud Herman Miller Inc. of $1.77 MillionRead the Press Release
GRAND RAPIDS, MICHIGAN — Acting U.S. Attorney Andrew Birge announced today that Kevin John Grimm, 61, was sentenced to serve 27 months in federal prison for his role in defrauding furniture manufacturer Herman Miller Inc. in a vendor invoicing scheme. The Honorable Paul L. Maloney, U.S. District Judge, imposed the sentence. In addition to the prison term, Grimm was ordered to serve two years of supervised release, pay $458,947.14 in restitution, and forfeit an additional $458,947.14 to the government.
Grimm pled guilty on March 21, 2017, to conspiracy to commit mail fraud and wire fraud. He admitted conspiring with Spring Lake resident Jerry Akers to devise and execute a scheme to defraud Herman Miller between June 2010 and July 2015 using Grimm’s company, KJ Gas Transportation, LLC. With Akers’s assistance as an employee at the company, Grimm submitted false and fraudulent invoices for payment for natural gas services he never provided. The fraud scheme generated $1,772,726 in payments to his company. Prior to Grimm’s sentencing, Akers and Grimm collectively returned $1,313,779 of the illegal proceeds they obtained during the fraud, with Grimm paying $1,223,779 of that amount.
This matter was investigated by the Grand Rapids office of the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorney Christopher O’Connor.
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Dr. Lawrence Nassar Pleads Guilty to Child Pornography and Obstructing Justice ChargesRead the Press Release
GRAND RAPIDS, MICHIGAN – Dr. Lawrence Gerard Nassar, 53, of Holt, Michigan pleaded guilty pursuant to a plea agreement to the three federal criminal charges pending against him, Acting U.S. Attorney Andrew Birge announced today. Nassar pleaded guilty to receiving child pornography in 2004, possessing child pornography from 2003 to 2016, and destroying and concealing evidence in 2016 when he believed correctly that ongoing investigation by law enforcement would reveal his child-pornography activities. Nassar faces a minimum of five years and a combined maximum of 60 years in prison. Nassar agreed not to oppose a number of sentencing-guideline factors that result in an advisory sentencing range of at least 262 to 327 months (approximately 22-27 years) in prison. Under federal law, the advisory range is the starting point for the court’s determination of an appropriate sentence. While Nassar may pursue a below-guideline sentence, the government remains free to pursue a sentence of up to 60 years.
As part of the plea agreement, Nassar agreed not to oppose a sentencing enhancement for engaging in a pattern of activity involving child sexual abuse or exploitation. He also agreed to make full restitution to all of the victims of his sexual exploitation, as determined by the Court at sentencing. The plea agreement provides that the government will forgo charges with respect to four (4) specific individuals, related to the production or attempted production of child pornography and interstate or foreign travel with intent to engage in illicit sexual activity. Nevertheless, the agreement provides that the Court may consider this conduct in determining Nassar’s sentence. In addition, the government noted at the change-of-plea hearing that it had consulted with each of the four (4) individuals specified in the plea agreement and each supported the plea agreement and resolution. The plea agreement does not preclude the government from pursuing additional charges against Nassar related to his conduct with other individuals, if appropriate.
U.S. District Judge Janet Neff will sentence Nassar on a date to be scheduled by the Court. Under federal sentencing law, the Judge may consider the full scope of Nassar’s misconduct when determining the appropriate sentence, including uncharged misconduct. Specifically, federal law provides that "[n]o limitation shall be placed on the information concerning the background, character, and conduct of a person convicted of an offense which a court of the United States may receive and consider for the purpose of imposing an appropriate sentence." In addition, the federal sentencing guidelines provide for a substantially increased sentence when a defendant has engaged in a pattern of activity involving the sexual abuse or exploitation of minors. Judge Neff will also have the authority to order that Nassar serve the rest of his life on court supervision after he completes his prison term. The law requires Nassar to register as a sexual offender.
Acting U.S. Attorney Birge said: "With Dr. Nassar’s admissions of guilt on federal charges today, victims and the public can be assured that a day of reckoning is indeed in Dr. Nassar’s future. No one, no matter his station in life, is above the law. Those who exploit children will be found out and they will be held accountable. Today’s guilty plea resolves the currently pending charges and it resolves specific charges with respect to the four individuals referenced in the plea agreement in accordance with their wishes as expressed directly to us. In addition, it ensures that all of Dr. Nassar’s victims, including those who are not victims of the current charges or referenced in the plea agreement, will have an opportunity for vindication through the broad federal sentencing process. My office will be aggressively pursuing a sentence that accounts for all of Dr. Nassar’s conduct."
"The sexual exploitation of minors is a reoccurring menace in this country and has lasting damaging impacts on its victims," said David P. Gelios, Special Agent in Charge, Detroit Division of the FBI. "The investigation that resulted in today’s guilty plea by Dr. Nassar demonstrates the FBI's commitment to protect our youth from anyone who sexually exploits kids. The safety and security of our children will always be of paramount importance to the FBI and our law enforcement partners."
"The Michigan State University Police Department is grateful for all of the efforts put forth in these cases by the United States Attorney’s Office for the Western District of Michigan," said James Dunlap, Police Chief and Director of the Michigan State University Police Department. "Additionally, we continue to appreciate our long standing partnership with the FBI and all of the work that is taking place in this joint investigation involving the federal matters in the Larry Nassar cases. Today’s plea does not impact the pending criminal sexual conduct cases in Michigan, which are currently being prosecuted by the Michigan Attorney General."
Persons with information relevant to Nassar’s conduct or sentencing may contact the Federal Bureau of Investigation at 1-800-225-5324 or [email protected].
This case is part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. The U.S. Attorney's Office, county prosecutor's offices, the Internet Crimes Against Children task force (ICAC), federal, state, and local law enforcement are working closely together to locate, apprehend, and prosecute individuals who exploit children. The partners in Project Safe Childhood work to educate local communities about the dangers of online child exploitation, and to teach children how to protect themselves. For more information about Project Safe Childhood, please visit the following web site: www.projectsafechildhood.gov. Individuals with information or concerns about possible child exploitation should contact local law enforcement officials.
The Detroit and Los Angeles Divisions of the Federal Bureau of Investigation (FBI) and the Michigan State University Police Department (MSUPD) investigated the case. Assistant U.S. Attorney Sean M. Lewis prosecuted the case.
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Kalamazoo Man Sentenced to 15 Years in Prison for Possessing A Firearm as A FelonRead the Press Release
GRAND RAPIDS, MICHIGAN — Forty-one-year-old Lamont Duane Dixon, of Kalamazoo, Michigan, was sentenced to 180 months in prison, following his conviction for unlawful possession of a firearm as a felon. Under the federal Armed Career Criminal Act, Dixon was subject to a 15-year mandatory minimum sentence due to three prior felony convictions under Michigan law for manufacture/delivery of less than 50 grams of a narcotic drug.
In announcing the sentence, the Honorable Janet T. Neff, United States District Judge for the Western District of Michigan, stated that "all gun offenses are serious, to one extent or another." The Court continued that the defendant’s personal history of addiction, drug dealing, and violent behavior compounded the seriousness of his offense. The Court underscored the need for the sentence to adequately punish the defendant and to promote respect for the law.
Acting U.S. Attorney Andrew Birge commented that "Federal law provides a 15-year mandatory-minimum sentence for felons in possession of firearms specifically for defendants like Mr. Dixon—chronic, ‘career’ criminals who continue, time and again, to commit serious drug offenses or violent felonies and then pick up a firearm. The many sentences such defendants have received in the past for their multiple felony convictions simply have not done enough to deter them from committing more crimes and picking up firearms. These types of prosecutions are integral to our Office’s mission to pursue justice and ensure public safety."
The U.S. Attorney’s Office and the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) work closely with the Kalamazoo Department of Public Safety to identify priority offenders, like Dixon, whose prior convictions, history of violence, or involvement in group violence, warrant federal prosecution. "Instead of becoming a productive member of society, Mr. Dixon continued to put innocent lives in danger by engaging in illegal activity," said ATF Special Agent in Charge Robin Shoemaker. "ATF will continue to work closely with our law enforcement partners to get violent criminals off the streets and behind bars."
The Kalamazoo Department of Public Safety and ATF investigated the case. Assistant U.S. Attorney Kate Zell prosecuted the case.
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Psychologist George E. Compton Jr. of Sturgis Pleads Guilty to Health Care FraudRead the Press Release
Compton Billed Insurers for Numerous Counseling Sessions that he did not Provide
GRAND RAPIDS, MICHIGAN —Acting U.S. Attorney Andrew Byerly Birge announced that George E. Compton, Jr., 63, of Sturgis, Michigan, pled guilty today in federal court to a felony information charging him with executing a health care fraud scheme from at least January 1, 2013, until June 30, 2016. Compton will be sentenced at a date to be determined by the court, at which time he will face a maximum prison term of 10 years, a fine of up to twice the amount of the gross gain from his fraud, and he will be ordered to make restitution to his victims.
According to court records, Compton defrauded health care benefit programs of at least $250,000.00. As part of the scheme to defraud, Compton established legitimate relationships with numerous patients, provided periodic counseling sessions to his patients, and billed their health care benefit programs. However, after establishing these relationships, Compton regularly billed his patients’ health care benefit programs for counseling sessions that grossly exceeded the number of actual counseling sessions that he provided. When his patients or the health care benefit programs occasionally detected his excess billings, Compton furthered his scheme to defraud by falsely claiming that the billings were the result of an honest mistake or the automated billing functions of his billing software and he reimbursed the health care benefit program for the over-payment. Additionally, when audited by one of the health care benefit programs, Compton further carried out the scheme to defraud by providing the health care benefit program with fake patient counseling notes in an attempt to make it appear as if he actually provided counseling sessions on dates that he knew he had previously submitted false billing. On at least one occasion, he billed for counseling sessions that he claimed occurred at his Coldwater office despite the fact that he was actually in Pittsburgh, Pennsylvania. On another occasion, he billed for counseling sessions for a patient that was actually hospitalized in an induced coma and later homebound.
"Unfortunately, this case represents yet another example of how some health care professionals allow their own greed to lead them down the path of defrauding health care benefit programs and ultimately harming consumers of health insurance," said Birge. "My office will continue to vigorously prosecute those who commit health care fraud against private or public health insurance plans."
"Today’s guilty plea should serve as a warning that those who place their own greed for profits above honest billing practices will be identified and prosecuted," said David P. Gelios Special Agent in Charge, Detroit Division of the FBI.
The case was investigated by the Kalamazoo office of the FBI and is being prosecuted by Assistant U.S. Attorney Ronald M. Stella.
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Grand Traverse Band Member Sentenced to 30 Years for Sexually Abusing A Five-Year-Old ChildRead the Press Release
GRAND RAPIDS, MICHIGAN — Jon Nathaniel-Nunghons Brenner, age 34, formerly from Hopkins and Grand Rapids, was sentenced to 30 years in federal prison for aggravated sexual abuse. The sexual assault occurred on lands held in trust for the Grand Traverse Band of Ottawa and Chippewa Indians in Leelanau County. The child victim and Brenner are both enrolled members of the tribe. Acting U.S. Attorney Andrew Birge stated, "It is crucial that we protect society’s most vulnerable members from sexual exploitation and ensure significant and certain punishment for those predators who would exploit children, especially in our tribal communities where sadly we see too many Native women and children subjected to such violence."
In announcing the sentence, U.S. District Judge Janet T. Neff remarked on the terrible nature of the sexual assault on a very young and vulnerable girl, and the likely lifelong consequences this would have on the victim’s life. Judge Neff further commented on the extreme longterm risk that Brenner posed and that he may forever be a danger to the community. Following his term of incarceration, Brenner will spend the rest of his life on supervised release. He will also be required to register as a sexual offender.
In October 2015, the 5-year-old victim reported to her mother that Brenner had sexually assaulted her. The resulting investigation disclosed that Brenner sexually assaulted the girl he was babysitting over a period of seven months. Federal charges were filed in May 2016 alleging six counts of aggravated sexual abuse of a minor. Brenner was arrested on June 7, 2016, and he has been held in custody since his arrest. He pleaded guilty to aggravated sexual assault in November of 2016.
"The sexual exploitation of children is sadly often perpetrated by adults who parents know and mistakenly trust," said David P. Gelios, Special Agent in Charge, Detroit Division of the FBI.
"As evidenced by the 30 year sentence in this case, sexual predators need to understand the FBI, our law enforcement partners, and our court system will utilize every tool in our toolbox to protect children from the Jon Brenners of the world and all those like him."
The U.S. Attorney’s Office works closely with the 11 Tribes in the District to ensure that crimes committed in their communities are addressed in a timely and appropriate manner. Cases such as these are a shared responsibility with the FBI, tribal law enforcement, and the U.S. Attorney’s Office. This case is a result of a collaborative investigation by the FBI and the Police Department of the Grand Traverse Band of Ottawa and Chippewa Indians. Assistant U.S. Attorneys Alexis M. Sanford and Jeff J. Davis prosecuted the case.
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Battle Creek Man Pleads Guilty to Producing Child PornographyRead the Press Release
GRAND RAPIDS, MICHIGAN – Matthew John Andaluz, 44, of Battle Creek, Michigan pleaded guilty before the Hon. Robert J. Jonker, Chief U.S. District Judge, to producing child pornography, Acting U.S. Attorney Andrew Birge announced today. Andaluz faces a minimum of 15 years and a maximum of 30 years of imprisonment, and he will be required to serve a term of supervised release after his prison term has been completed. Andaluz will also be required to register as a sexual offender.
Andaluz admitted at the plea hearing that he had taken pornographic photographs of a ten-year-old child at his home in Calhoun County. The conduct occurred in late 2010 and early 2011. Andaluz came to the attention of law enforcement in November 2016, when agents and investigators traced images Andaluz had distributed over the Internet back to his home in Calhoun County. Agents executed a search warrant at Andaluz’s home on December 16, 2016, and arrested him. Andaluz remains in custody pending sentencing, which is scheduled for September 25, 2017.
This case is part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. The U.S. Attorney's Office, county prosecutor's offices, the Internet Crimes Against Children task force (ICAC), federal, state, and local law enforcement are working closely together to locate, apprehend, and prosecute individuals who exploit children. The partners in Project Safe Childhood work to educate local communities about the dangers of online child exploitation, and to teach children how to protect themselves. For more information about Project Safe Childhood, please visit the following web site: http://www.projectsafechildhood.gov/. Individuals with information or concerns about possible child exploitation should contact local law enforcement officials.
The Department of Homeland Security, Homeland Security Investigations (HSI) investigated the case. Assistant U.S. Attorney Sean M. Lewis prosecuted the case.
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Muskegon Heights Man Sentenced to 10 Years in Federal Prison for Firearms OffenseRead the Press Release
GRAND RAPIDS, MICHIGAN – Stephen Adonis Conley, age 30, also known as "Steph," of Muskegon Heights, Michigan was sentenced to the maximum possible sentence of 10 years in federal prison for possessing firearms and ammunition as a convicted felon, Acting U.S. Attorney Andrew Birge announced today. In addition to the prison term, U.S. District Judge Paul L. Maloney imposed a three-year term of supervised release that will commence once Conley is released from imprisonment.
Conley came to the attention of law enforcement after he sold heroin to a police informant on September 8, 2016. Police executed a search warrant at the home in which Conley was staying the following day, where they found Conley in possession of a loaded .40 caliber semiautomatic pistol, a loaded .357 revolver, a large quantity of cash, drug paraphernalia, and some heroin. Conley was arrested on scene, and he pled guilty on January 26, 2017, to one count of being a felon in possession of a firearm and ammunition.
In its sentencing memorandum, the U.S. Attorney’s Office argued in favor of the 10-year sentence, noting that "[t]rafficking in illegal drugs while having ready access to loaded handguns poses a significant risk to the community." The danger in Conley’s case was highlighted by his significant criminal history, which included convictions for aggravated assault, domestic violence, felon in possession of a firearm, and drug trafficking. The U.S. Attorney’s Office also noted that the Muskegon-area community was suffering from violence and drug trafficking, and there was a great need to deter such conduct.
"While gang violence and drug trafficking continues to plague the safety and security of our neighborhoods, this sentencing underscores the continuing impact that the West Michigan Enforcement Team (WEMET) and Muskegon Violent Crimes Task Force is having on the ability of gang members to threaten our communities," said David P. Gelios, Special Agent in Charge, Detroit Division of the FBI.
This case was prosecuted by Assistant U.S. Attorney Sean Lewis. The charges in this case are the result of a joint investigation by the West Michigan Enforcement Team (WEMET) and the Muskegon Violent Crimes Task Force, which includes the Federal Bureau of Investigation (FBI), the Michigan State Police (MSP), and the Muskegon City Police
Department. The U.S. Attorney's Office, the Muskegon County Prosecutor's Office, and federal, state, and local law enforcement are working closely together to combat violent crime and drug trafficking in the Muskegon area.
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Last Defendants Sentenced in Massive Conspiracy to Commit Tax Fraud in Battle CreekRead the Press Release
GRAND RAPIDS, MICHIGAN — Acting U.S. Attorney Andrew Birge announced that Diallo Dotson, Charleeta Cork and Simone Watkins were sentenced in federal district court this week for conspiring to defraud the United States through the filing of false income tax returns to receive fraudulent federal income tax refunds. These sentencings mark the conclusion of the prosecution of 33 individuals engaged in a conspiracy with Derrick J. Gibson, of Battle Creek, Michigan, to file false federal income tax returns. The conspiracy operated from 2008 to 2016 and resulted in more than $22 million dollars of loss to the Internal Revenue Service.
The ring-leader, Derrick J. Gibson, was sentenced on January 6, 2017, to the statutory maximum sentence of 10 years in prison and restitution of $16 million. This week, Diallo Dotson was sentenced to serve two years of probation including six weekends in jail and restitution of $76,476. Charleeta Cork was sentenced to a day in prison (time served), two years of supervised release including four weekends in jail and restitution of $41,075. Simone Watkins was sentenced to a day in prison (time served), two years of supervised release and restitution of $84,934.
A multi-year joint investigation led by the Internal Revenue Service Criminal Investigation, Veterans Affairs – Office of the Inspector General, United States Postal Inspection Service, the Bureau of Alcohol Tobacco and Firearms, Department of Homeland Security, Battle Creek Police Department, Albion Police Department, Calhoun County Sheriff’s Department, and Michigan State Police resulted in the federal charges.
"The sentencings in this case and the fact the perpetrators will have to pay back what they took illegally, shows that the government is serious when it comes to prosecuting those that want to use the tax system as their own personal bank account," said Special Agent in Charge Manny Muriel of IRS-Criminal Investigations. "This conspiracy involved 33 people, including three federal employees who stole from the American taxpayer through the filing of false tax returns in innocent people’s names. IRS Criminal Investigations and its law enforcement partners are dedicated to ferreting out these perpetrators and protecting the American public."
This case was prosecuted by Assistant U.S. Attorney B. Rene Shekmer.
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Federal Jury Convicts Intoxicated PilotRead the Press Release
GRAND RAPIDS, MICHIGAN — Acting U.S. Attorney Andrew Birge announced that Sean Michael Fitzgerald, 35, of Boca Raton, Florida, was convicted today by a federal jury of operating a common carrier under the influence of alcohol. Chief United States District Judge Robert J. Jonker presided over the four-day trial. Fitzgerald faces a statutory maximum term of imprisonment of fifteen years at the time of sentencing.
The proofs at trial established that on August 25, 2016, Fitzgerald arrived at the Cherry Capital Airport in Traverse City, Michigan, to co-pilot a private charter to Bedford, Massachusetts. On the way to the airport and once there, witnesses observed obvious signs of intoxication, including slurred speech, the smell of alcohol on his breath, and bloodshot eyes. Fitzgerald proceeded to the plane and began the pre-flight preparation process before he was arrested. Among other tasks, he inspected the plane, completed systems checks, turned on the auxiliary power unit, and received clearance for the flight’s route from air traffic control. After the arrest, his blood alcohol content was measured at 0.343%.
“Aircraft are complex machines and intoxicated operation poses a danger to passengers, the ground crew at the airport, and the public even before they begin to taxi,” Acting U.S. Attorney Birge said. “I commend airport personnel and law enforcement for their swift action to prevent this defendant from flying the plane, but that does not lessen the gravity of his crime.”
Federal Bureau of Investigation (FBI) Special Agent in Charge David P. Gelios commented that: “Today's verdict demonstrates how alert members of our community, coupled with strong and dedicated law enforcement action, continues to keep people safe. This diligence prevented what could have been a tragic example of the dangers of alcohol use and operating any kind of vehicle or aircraft.”
The FBI and the Traverse City Police Department investigated the case. Assistant U.S. Attorneys Clay M. West and Justin M. Presant prosecuted it.
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Battle Creek Hotel Owner Sentenced to Prison for Lying About Minimum Wage PaymentsRead the Press Release
GRAND RAPIDS, MICHIGAN — Acting U.S. Attorney Andrew Birge announced today that Mehul Chandubhai Patel, a/k/a "Mike Patel," 31, of Battle Creek, Michigan, was sentenced yesterday for lying to Labor Department investigators about the wages paid to his staff. The charges stem from Patel’s violation of minimum wage rules in connection with two hotels he operated in Battle Creek and Coldwater, Michigan.
On February 2, 2017, Patel appeared in federal court and pled guilty to violating a federal statute that prohibits anyone from concealing a material fact from the federal government when obligated to disclose it. He admitted that during 2005, the Department of Labor ("DOL") found that he had violated minimum wage laws by underpaying his hotel employees. He thereafter signed an agreement promising to repay his employees. When the DOL asked him to provide proof that he had done so, Patel sent them copies of checks indicating that he had paid the back wages. However, he concealed the fact that he required his employees to return the money to him immediately after cashing the checks.
Patel appeared yesterday for sentencing before U.S. District Judge Paul Maloney. After hearing arguments from the defense that Patel deserved no jail time, Patel received a sentence of 2 months incarceration. Judge Maloney also ordered Patel to pay a $10,000 fine immediately and promised a ruling on the $250,000 restitution issue within a month.
Acting U.S. Attorney Andrew Birge stated: "Cheating employees out of their wages is unacceptable, especially when we are talking about the bare minimum wage the law allows. Any employer who does that and then lies to the government about it should expect federal agents with an arrest warrant will come knocking at the door."
"Mehul Patel exploited vulnerable workers by compelling them to kickback a portion of their wages and then he submitted false documents to the Department of Labor’s (DOL) Wage and Hour Division to cover up the scheme. We are committed to working with our DOL partner agencies to preserve the integrity of all DOL enforcement programs," stated James Vanderberg, Special Agent in Charge, Chicago Region, U.S. Department of Labor, Office of Inspector General.
Prosecution of the matter has been assigned to Timothy VerHey, Assistant U.S. Attorney. The matter was investigated by the US Department of Labor, Office of Inspector General, Homeland Security Investigations, and the Battle Creek Police Department.
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Former Rockford Coach Sentenced to 22 Years for Producing Child PornographyRead the Press Release
GRAND RAPIDS, MICHIGAN – Timothy Vallier, 31, of Ada, Michigan, was sentenced in federal court for attempted sexual exploitation of children and possession of child pornography, Acting U.S. Attorney Andrew Byerly Birge announced today. U.S. District Judge Gordon J. Quist imposed a sentence of 22 years. In addition to the prison term, Vallier was ordered to serve 5 years of supervised release, to pay restitution, and to register as a sex offender for the rest of his life.
On September 28, 2016, Vallier pled guilty to producing approximately 86 hidden camera videos of girls changing clothes at two high school facilities: the Rockford rowing team’s boathouse and the Rockford Freshman Center. He made these videos between January 2012 and April 2016 while he was the rowing coach at Rockford High School. The charges followed an investigation by the Kent County Sheriff’s Department, the Michigan State Police Internet Crimes Against Children Task Force, and Homeland Security Investigations.
"While no amount of prison time can adequately punish a child predator, this sentencing will hopefully begin the healing process for those impacted by Mr. Vallier's depraved acts," said HSI Acting Special Agent in Charge Steve Francis. "This was an excellent collaboration between HSI and its partners at the Kent County Sheriff’s Office and Michigan State Police to bring this predator to justice."
HSI encourages the public to report suspected child predators and any suspicious activity through its toll-free Tip Line at 1-866-DHS-2-ICE or by completing its online tip form. Both are staffed around the clock by investigators. From outside the U.S. and Canada, callers should dial 802-872-6199. Hearing impaired users can call TTY 802-872-6196. Information concerning suspected child sexual exploitation or missing children may be reported to the National Center for Missing & Exploited Children, an Operation Predator partner, via its toll-free 24-hour hotline, 1- 800-THE-LOST. For additional information about wanted suspected child predators, download HSI’s Operation Predator smartphone app or visit the suspect alerts page.
This case was prosecuted by Assistant U.S. Attorneys Tessa K. Hessmiller and Daniel Y. Mekaru as part of the Department of Justice’s Project Safe Childhood, a nationwide initiative designed to protect children from exploitation and abuse. The U.S. Attorney’s Office, county prosecutor’s offices, and federal, state, and local law enforcement are working closely together to locate, apprehend, and prosecute individuals who exploit children. Individuals with information or concerns about possible child exploitation should contact local law enforcement. For more information about Project Safe Childhood in West Michigan, including resources for children and parents, visit: http://www.justice.gov/usao/miw/programs/psc.html.
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Ring Leader of Gas-Pump Skimming and Identity-Theft Scheme Sentenced to 12 Years in Federal PrisonRead the Press Release
Scheme Stretched from Texas into Colorado, Indiana, Wisconsin, Ohio and Michigan
GRAND RAPIDS, MICHIGAN — Antonio DeJesus Perez-Martinez, 44, formerly of Austin, Texas, was sentenced today to serve 144 months, or exactly 12 years, in the Federal Bureau of Prisons for his leadership of a scheme that involved the installation of hidden data-skimming devices inside gas pumps, encoding credit-account data that was harvested by those devices onto "cloned" credit cards, and use of the cards to bulk-buy gift cards and prepaid debit cards at self-checkout lanes of major retailers. Perez-Martinez was convicted of conspiracy to commit wire-fraud, credit-account fraud, and aggravated identity-theft after a trial in U.S. District Court during January 2017, and he is the last of eight defendants charged in a long-running investigation that was conducted by the Lansing office of the FBI, with assistance from the U.S. Postal Inspection Service, the Grand Rapids Metro Fraud and Identity-Theft Team, and the Grand Ledge Police Department.
The evidence at trial established that Perez-Martinez, a Cuban citizen and lawful permanent resident of the United States ("green-card" holder), recruited numerous recently-arrived Cuban citizens – all of whom had entered the United States in 2014 under a special "parole" program that admitted Cuban citizens who presented themselves to immigration authorities at the border – into a fraud scheme that initially involved obtaining compromised credit-account data from illicit websites. During the Summer of 2015, Perez-Martinez switched from acquiring account data online to using "skimming" devices that his accomplices secretly installed inside gas-pumps, and also extended his group’s operation into West Michigan. Skimming devices capture the account data of any card used to purchase gas without interfering with the purchase, leaving the account holder unaware that the data has been compromised until it has been re-encoded onto cloned cards and used to make unauthorized purchases.
Perez-Martinez’ sentence is the seventh prison term imposed in the case: Raul Gonzalez Falcon (29), Yunier Carballo-Pupo (34), Manuel Perez-Cabrera (38), and Michel Velazquez-Gregori (30), none of whom had prior criminal records and all of whom agreed to plead guilty and to cooperate with the investigation, all received sentences of 21 months in prison. Pedro Sanchez-Pupo (32) received a sentence of 37 months. A seventh defendant, Juan Estrada-Galvez, was allowed to plead guilty to a state misdemeanor in Kent County when the investigation determined that his involvement in the scheme had been minimal.
"Perez-Martinez has learned the hard way that West Michigan is the wrong place to visit if you’re engaged in a gas-pump skimming scheme," stated Acting U.S. Attorney Andrew Birge. "The odds of getting caught here are good, and if you are caught, then your case will be prosecuted in Federal court and the investigative resources of the FBI will be brought to bear against you. That applies both to those who are caught in the act and to people like Perez- Martinez who might never set foot in West Michigan, but who send their subordinates here. The long arms of federal law caught Perez-Martinez. And those arms aren’t letting go until he serves his time."
"The guilty verdict and subsequent lengthy sentence in this case demonstrate that criminals who engage in identity theft will be held accountable for their crimes. The FBI, along with our local, state and federal law enforcement partners, is committed to safeguarding the public against such crimes and working to ensure the American public is secure in its financial transactions," said David P. Gelios, Special Agent in Charge of the Detroit Division of the FBI.
The case was prosecuted by Assistant U.S. Attorney Hagen W. Frank.
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Albion Doctor Sentenced to 15 Months in PrisonRead the Press Release
Dr. Horace Junior Davis Illegally Prescribed Opioid Painkillers and Billed Insurance Companies for Services he Never Rendered
GRAND RAPIDS, MICHIGAN — Acting U.S. Attorney Andrew Birge announced today that Doctor Horace Junior Davis, age 66, of Albion, Michigan, was sentenced to 15 months in federal prison for illegally prescribing opioid painkillers and committing healthcare fraud. U.S. District Judge Paul L. Maloney also ordered that Dr. Davis pay restitution and serve two years on supervised release after his prison sentence.
Dr. Davis, who was the owner of the Albion Center for Family Medicine, illegally prescribed the powerful opioid painkiller methadone to several patients in 2011 – 2013. He sought to make money from the illegal prescriptions by fraudulently billing healthcare benefit programs for the patients who had insurance coverage, or by collecting cash from the patients who didn’t have insurance coverage.
Judge Maloney noted that illegal prescriptions such as the ones Dr. Davis wrote are part of a larger opioid epidemic currently affecting the United States. According to the most recent data from the Centers for Disease Control, deaths from prescription opioids – drugs like oxycodone, hydrocodone, and methadone – have more than quadrupled since 1999. The CDC says that opioids were involved in 33,000 deaths in 2015 alone, and 91 people die every day from an opioid overdose.
Acting U.S. Attorney Andrew Birge said, "Whether it’s a supplier of heroin to street-corner dealers or a physician illegally writing prescriptions, my office will continue to hold accountable those who would profit from spreading the tragic curse of opioid addiction. Unfortunately, we will not end the epidemic through prosecution alone. My office has been and will continue to meet with education and health care professionals and those who may be able to make a difference to raise awareness of the danger of opioids and to discuss what they can do to save others from the awful consequences of spiraling addiction. Please contact us if you are interested in learning more."
This case was investigated by the Drug Enforcement Administration, the Albion Police Department, the Calhoun County Sheriff’s Department, and IRS Criminal Investigations. It was prosecuted by Assistant U.S. Attorney Clay Stiffler.
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Jury Finds Texas Man Guilty in Cocaine Trafficking ConspiracyRead the Press Release
Two coconspirators pled guilty before trial.
GRAND RAPIDS, MICHIGAN - Acting U.S. Attorney Andrew Birge announced today that a jury convicted Jaime Valente Pina, Jr., age 24, of Alamo, Texas, of conspiring to distribute cocaine. Jaime Valente Pina, Jr., Angel Pina, and Magdaleno Rodriguez were charged in February 2017 with conspiracy to distribute and to possess with intent to distribute cocaine and other cocaine trafficking charges.
The conspiracy began in the summer of 2015 when Magdaleno Rodriguez, a cocaine dealer operating in and around Oceana County, was introduced to Jaime Valente Pina, Jr. as a new source of supply for cocaine. Thereafter, Jaime Pina and his brother, Angel Pina, supplied cocaine to Rodriguez on a monthly basis for further redistribution throughout West Michigan. The Pina brothers are from the Rio Grande Valley – the southernmost tip of Texas - which shares an extensive stretch of border with Mexico. Throughout the conspiracy, they brought cocaine to Rodriguez from their Texas-based source of supply. The conspiracy ended in approximately August 2016 after officers of the State, Sheriffs, Chiefs, Enforcement Narcotics Team concluded undercover buys from Rodriguez and executed a search warrant on his home. The Pina brothers were arrested on November 9, 2016 after officers of the West Michigan Enforcement Team executed a search warrant on a home they were at in Ravenna, Michigan. .
Magdaleno Rodriguez and Angel Pina pled guilty prior to trial and are currently scheduled to be sentenced by U.S. District Judge Janet T. Neff on June 8, 2017. Jaime Valente Pina, Jr. was convicted after a three-day jury trial. The jury rejected his claim at trial through counsel that he was merely an innocent migrant worker. He is scheduled to be sentenced on August 30, 2017. The Pinas each face a statutory maximum term of imprisonment of 20 years. Magdaleno Rodriguez, who already had two prior felony drug convictions, faces a mandatory minimum term of imprisonment of 5 years up to a statutory maximum term of imprisonment of 40 years.
The investigation was led by Homeland Security Investigations, an investigative arm of the Department of Homeland Security with assistance from two state managed multijurisdictional narcotics task forces: the State, Sheriffs, Chiefs Enforcement Narcotics Team and the West Michigan Enforcement Team. Assistant United States Attorneys Joel S. Fauson and Timothy P. VerHey are handling the prosecution.
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West Michigan Man Sentenced to Prison in Scheme to Defraud Herman Miller Inc. of $1.77 MillionRead the Press Release
GRAND RAPIDS, MICHIGAN — Acting U.S. Attorney Andrew Birge announced today that Spring Lake resident Jerry Lee Akers, 54, was sentenced to serve 41 months in prison for his role in defrauding furniture manufacturer Herman Miller Inc. in a vendor invoicing scheme. The Honorable Paul L. Maloney, U.S. District Judge, imposed the sentence. In addition to the prison term, Akers was ordered to serve two years of supervised release; to pay $507,309.14 in restitution, and forfeited an additional $507,309.14 to the government.
Akers pled guilty to conspiracy to commit mail fraud and wire fraud. He admitted conspiring with Coopersville resident Kevin Grimm to devise and execute a scheme to defraud Herman Miller between June 2010 and July 2015 using Grimm’s company, KJ Gas Transportation, LLC. With Akers’s assistance on the inside of the company, Grimm submitted false and fraudulent invoices for payment for natural gas services he never provided. The fraud scheme generated $1,772,726 in payments to Grimm’s company.
Co-conspirator Kevin Grimm was indicted by a grand jury in February 2017 for his role in the offense. On March 21, 2017, Grimm pled guilty to conspiring with Akers to defraud Herman Miller Inc. in the scheme. Grimm will be sentenced by Judge Maloney on July 10, 2017.
Prior to Akers’s sentencing, Akers and Grimm collectively returned $1,265,417 of the illegal proceeds they obtained during the fraud. Akers’s sentence reflects, in part, the government’s recommendation that he receive a reduced sentence for his substantial assistance to law enforcement in the investigation and prosecution of Grimm.
"The FBI is committed to rooting out all fraud that endangers local businesses which make up the backbone of our American economy. We will continue to work with our partners at the U.S. Attorney’s Office to investigate fraudulent schemes and stop those who line their own pockets at the expense of others,” said David P. Gelios, Special Agent in Charge, Detroit Division of the FBI.
This matter was investigated by the Grand Rapids office of the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorney Christopher O’Connor.
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Kincheloe Man Sentenced for Second Habitual Domestic Violence OffenseRead the Press Release
MARQUETTE, MICHIGAN — Nicholas James Sayles, 34, of Kincheloe, Michigan was sentenced to 30 months in federal prison for domestic violence by an habitual offender, Acting U.S. Attorney Andrew Birge announced today. In addition to the prison term, U.S. District Judge Paul L. Maloney ordered Sayles to serve two years of supervised release following his prison term, and to pay a $100 special assessment.
On November 30, 2016, Sayles pleaded guilty to a federal indictment charging him with domestic violence by an habitual offender. Sayles lived with the victim at a residence located on Sault Ste. Marie Tribal land. On March 7, 2016, Sayles assaulted the victim, striking her face with his head, breaking one of her teeth. Sayles was previously convicted of domestic violence by an habitual offender in federal court in 2011, and has two prior state convictions for domestic violence offenses.
The Sault Ste. Marie Tribal Police, Kinross Police, and the Federal Bureau of Investigation investigated the case. Assistant U.S. Attorney Paul D. Lochner prosecuted the case.
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Gila River Tribal Member Sentenced for Near-Fatal Assault of A WomanRead the Press Release
MARQUETTE, MICHIGAN — David Kel Baldwin, Jr., 45, of Watersmeet, Michigan was sentenced to 41 months in federal prison for assault resulting in serious bodily injury, Acting U.S. Attorney Andrew Birge announced today. In addition to the prison term, U.S. District Judge Paul L. Maloney ordered Baldwin to serve three years of supervised release following his prison term, to pay a $2,000 fine, and to pay a $100 special assessment. Baldwin pleaded guilty to the charge on February 2, 2017.
On August 12, 2016, Baldwin, an enrolled member of the Gila River Indian Community, assaulted an enrolled member of the Lac Vieux Desert Tribe at a residence located on Lac Vieux Desert reservation lands, beating the female victim with his hands. The victim suffered serious bodily injury as a result, and, if not treated promptly by medical personnel, would likely have died as a result of her injuries.
The Lac Vieux Desert Tribal Police and the Federal Bureau of Investigation investigated the case. Assistant U.S. Attorney Paul D. Lochner prosecuted the case.
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Tax Cheat Sentenced to Prison for 15 MonthsRead the Press Release
MDOC Inmate Timothy Lofton, Jr., executed a tax fraud scheme while incarcerated.
GRAND RAPIDS, MICHIGAN — Acting U.S. Attorney Andrew Birge announced today that Timothy Lofton, Jr., age 34, received a sentence of 15 months in prison for his role in a tax fraud scheme that Lofton led while in jail. The Hon. Robert Jonker also ordered restitution in the amount of $2,319.
In 2011, Lofton was a prisoner in the Michigan Department of Corrections (MDOC). While there, he obtained some of his fellow inmates’ personal identification information, such as name, social security number and date of birth. Lofton shared the identification information with associates in the Benton Harbor, Michigan area. The associates then caused false federal tax returns to be filed based on the inmate identification information, without the inmates’ knowledge or permission. The federal tax returns requested tax refunds for each inmate, despite the fact that the listed income amounts were false and the inmates would never get the refunds. Although the scheme was pervasive and the IRS had initially paid out hundreds of thousands of dollars, the IRS was able to uncover the scheme in time and recover all but about $3,000.
Acting U.S. Attorney Birge pledged his office’s resources to prosecuting tax offenses. “Tax cheats steal from our federal budget and increase the burden on the honest and responsible citizens. Tax cheats will be held accountable and we will do everything we can to get every cent back-- including asking courts to order offenders to repay what we haven’t yet recovered.”
“The IRS aggressively pursues those who hijack others’ identities in order to file false returns”, said IRS-Criminal Investigation Special Agent in Charge Manny Muriel. “As demonstrated in this case, during this tax season, the IRS collaborated with our partners to further prevent, detect and resolve identity theft cases.”
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DEA and Partners Across Michigan Continue Drug Abuse Prevention Efforts wtih Prescription Drug Take Back Day on SaturdayRead the Press Release
Over 200 Take Back locations across Michigan
Disposing of unused medications prevents drug thefts, abuse, and overdoses
Detroit, MI - Addictive prescription drugs that are thrown away or left untended on shelves and in drawers at home are often stolen and either abused or sold by family members and visitors. That’s why the DEA and thousands of its state, local, and tribal law enforcement and community partners are holding another Prescription Drug Take Back Day this Saturday, April 29, from 10 A.M. to 2 P.M. local time, at over 5,000 sites around the country. The service is free of charge, no questions asked.
America is experiencing an epidemic of addiction, overdose, and death due to abuse of prescription drugs, particularly opioid painkillers. 6.4 million Americans age 12 and over—2.4 percent of the population—abuse prescription drugs, according to the 2015 National Survey on Drug Use and Health released last fall, more than abuse cocaine, heroin, hallucinogens, and methamphetamine combined. Drug overdoses are now the leading cause of injury-related death in the United States, eclipsing deaths from motor vehicle crashes or firearms. The majority of prescription drug abusers report that they obtain their drugs from friends and family, including from the home medicine cabinet.
Last October, Americans turned in 366 tons (over 730,000 pounds) of prescription drugs at almost 5,200 sites operated by the DEA and more than 4,000 of its state and local law enforcement partners. Overall, in its 12 previous Take Back events, DEA and its partners have taken in over 7.1 million pounds—more than 3,500 tons—of pills.
The public can find a nearby collection site at DEA.GOV and click on the “Take Back Day” box on the home page. You can also fine nearby collections sites by calling 800-882-9529. Only pills and other solids, like patches, can be brought to the collection sites—liquids, needles, or other sharps will not be accepted. This event will go on even if the Federal Government shuts down this weekend.
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Court Sentences Final of Nine-Defendant Kalamazoo Heroin Investigation to 15 Years' ImprisonmentRead the Press Release
GRAND RAPIDS, MICHIGAN — Today, U.S. District Court Judge Gordon J. Quist sentenced defendant Quintin Howell, of Kalamazoo, Michigan, to 15 years’ imprisonment, concluding a multi-defendant joint investigation conducted by the Drug Enforcement Administration (DEA), Kalamazoo Valley Enforcement Team (KVET), Michigan State Police’s Southwestern Enforcement Team (SWET), Federal Bureau of Investigation (FBI), and Berrien County Sheriff’s Department. Howell conceded that his conduct involved over 100 grams of heroin and the use of a Hi-Point, ACP Model 4595 assault rifle, with an obliterated serial number, in furtherance of his drug trafficking efforts. Additionally, the Court found that Howell was a manager in the heroin trafficking conspiracy, recruiting and directing others to further the distribution of the drug. The conspiracy Howell pleaded guilty to joining took place from 2013 through August of 2015.
Heroin distribution has been a scourge in our country and in Michigan. The Center for Disease Control reports that there were 47,055 drug overdose deaths in the United States in 2014, and that 61% involved the use of opioids, which includes heroin and the prescription narcotics that have caused an explosion of heroin use in recent years. Specifically, in Michigan, the CDC reports that 1,762 people died of drug overdoses in 2014, which is 18 people for every 100,000 of our population, a 13.2% increase over the previous year. In 2015, it rose again to 1,980 drug overdose deaths—one of the highest drug overdose death rates in the nation – 20.4 per 100,000 people See, http://www.cdc.gov/mmwr/preview/mmwrhtml/mm6450a3.htm#tab. In 2014, the Michigan Department of Community Health reported that drug overdose deaths have tripled in Michigan between 1999 and 2012. In 2015, over 33,000 Americans died of opioid overdoses.
Howell’s sentence was the final term handed down by the Court for nine total defendants charged as a result of the Kalamazoo based investigation. The investigation involved two courtordered wiretaps and 11 months of investigation by the law enforcement agencies involved.
In addition to Howell, the federal court sentenced the following individuals to the following terms of imprisonment in three related cases:
Case no. 15-cr-118
Timothy Bloodworth, 151 monthsCase no. 15-cr-119
Dion Branch, 96 months
Tyshaun Robinson, 60 months
Charles Campbell, 46 monthsCase no. 15-cr-120
Quintin Howell, 180 months
Kyle Lewis, 36 months
Maurice Streeter, 24 months
Justin Jenkins, 180 months
Henry Hall, 42 months“The successful outcome to this investigation should be credited to an extraordinary coordinated law enforcement effort to use as many investigative tools at our disposal as possible to dismantle organized drug trafficking in West Michigan,” said Acting U.S. Attorney Andrew Birge. “Heroin remains a plague upon our society. My office will continue to direct investigations that root out and hold accountable those who would profit from spreading this poison in our communities. However, we will not end this epidemic through prosecution alone. My office has been and will continue to meet with education and health care professionals and those who may be able to make a difference to raise awareness of the danger of opioids and to discuss what they can do to save others from the awful consequences of spiraling addiction.
Please contact us if you are interested in learning more.”
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Pictured in the attached photographs are four loaded firearms, and more than 100 grams of heroin seized by law enforcement in the course of the investigation.
Convicted Sex Offender Sent back to Prison After Possessing Child PornographyRead the Press Release
GRAND RAPIDS, MICHIGAN — Acting U.S. Attorney Andrew Byerly Birge announced today that Benjamin Franklin Miklusicak, 41, of Dorr, Michigan, was sentenced by U.S. District Judge Janet T. Neff to 124 months in prison for possessing child pornography. Miklusicak pled guilty to the charge in December. Because of a 2004 conviction for criminal sexual conduct, second degree (person under thirteen), he faced a ten-year mandatory minimum term of imprisonment.
During the investigation, Miklusicak admitted to a sexual interest in girls who are nine to thirteen years old and to viewing child pornography on a weekly basis. The images found on his laptop included some depicting prepubescent children engaging in sexual acts.
“There is perhaps no better indicator of the impending danger posed by a known pedophile than his decision to seek out images of children being abused,” Acting U.S. Attorney Birge said. “Incapacitation of recidivist sex offenders is critical to the protection of the kids in our community.”
“Miklusicak’s repeat sexual offenses make him an extreme danger to our youth. This sentencing will ensure that he no longer has access to children in any way,” said Steve Francis, Acting Special Agent in Charge of Homeland Security Investigations (“HSI”) Detroit. “The combined efforts of HSI and our partners continue to form a formidable barrier between predators and our children.”
This case is part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. The U.S. Attorney’s Office, county prosecutors’ offices, the Internet Crimes Against Children task force, and federal, state, and local law enforcement are working closely together to locate, apprehend, and prosecute individuals who exploit children. The partners in Project Safe Childhood work to educate local communities about the dangers of online child exploitation, and to teach children how to protect themselves. For more information about Project Safe Childhood, please visit the following web site: www.projectsafechildhood.gov. Individuals with information or concerns about possible child exploitation should contact local law enforcement officials.
HSI developed the investigation, and Assistant U.S. Attorney Justin M. Presant prosecuted the matter.
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Grand Rapids Bar Owner Sentenced to 13 Months in PrisonRead the Press Release
Brian Farah and His Father Skimmed $400,000 from their Bars and Destroyed Sales Records to Hide the Crime from the IRS
GRAND RAPIDS, MICHIGAN — Acting U.S. Attorney Andrew Birge announced today that Brian Farah, age 42, of Grand Rapids, Michigan, was sentenced to thirteen months in federal prison for obstructing an IRS audit. U.S. District Judge Paul L. Maloney also ordered that Farah pay restitution, a $5,000 fine, and serve one year on supervised release after his prison sentence. Farah and his father, Michael, previously pled guilty to the charge, admitting that they deleted business records after receiving notice of an Internal Revenue Service audit. Michael Farah will be sentenced in July.
Brian Farah and his father own three Grand Rapids area bars: Farah’s, Kuzzin’s, and Drake’s. In 2013, they skimmed $232,000 in cash from the bars, which they did not report on their business tax returns or individual tax returns. In 2014, they skimmed $176,000 in cash from the bars, which they again did not report on their tax returns. After receiving notice of an audit, they tried to hide their crime by deleting all of the bars’ sales records. They were caught when their sales software provider informed the IRS of the deletion.
Judge Maloney said Brian Farah’s conduct, which included "systematic and deliberate" destruction of business records and "lying directly to the face of an IRS agent," was a "blatant" violation of the tax laws.
"Schemes to conceal and insulate wealth in order to evade income tax, such as Brian Farah’s scheme, are unfair to every taxpayer who obeys the law and pays their fair share," said IRS-Criminal Investigation Special Agent in Charge Manny Muriel of the Detroit Field Office. "The public should know that IRS Criminal Investigations will do everything we can to hold individuals accountable to the same tax laws that they are subject to, ensuring that our tax system is fair to everyone."
This case was investigated by IRS Criminal Investigations. It was prosecuted by Assistant U.S. Attorney Clay Stiffler.
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