District of Minnesota
Press releases recorded for this federal judicial district.
Former CEO of Community Action of Minneapolis William Davis Indicted for Conspiracy, Fraud and Theft of Public FundsRead the Press Release
United States Attorney Andrew M. Luger today announced the indictment of WILLIAM JAMES DAVIS, 64, and JORDAN JAMES DAVIS, 34, for conspiring to steal funds from Community Action of Minneapolis (CAM) for the use of WILLIAM and JORDAN DAVIS. At all times relevant, WILLIAM DAVIS was the CEO of CAM, a non-profit organization created to provide services to low-income residents of Minneapolis and focusing on the elimination of poverty. CAM provided services including weatherization of homes, energy assistance, nutrition assistance and services for children and families. JORDAN DAVIS is expected to make an initial appearance tomorrow in U.S. District Court in St. Paul, Minn.
“This indictment charges a former non-profit leader and a police officer with stealing funds intended to keep Minnesotans warm during the winter,” said U.S. Attorney Luger. “This office will prosecute aggressively those who abuse needed public resources for personal gain.”
“Allegations into the misuse of hard-earned taxpayer money for personal gain are taken very seriously by the FBI and our law enforcement partners,” said FBI Special Agent in Charge for the Minneapolis Division Richard T. Thornton. “We will continue to pursue and address these cases with the highest investigative priority.”
According to the indictment and documents filed in court, CAM’s primary funding sources consisted of federal grants administered by the Minnesota Department of Commerce and Minnesota Department of Human Services. CAM also received funding from CenterPoint Energy (CenterPoint) and Xcel Energy (Xcel) in exchange for providing certain conservation and weatherization services to qualifying homeowners.
According to the indictment and documents filed in court, WILLIAM DAVIS was issued a credit card as CEO of CAM, for which CAM paid the balance due each month. W. DAVIS was required to use his corporate card “for agency authorized activities only.” As part of his scheme to defraud CAM, W. DAVIS concealed his diversion of CAM funds to his personal use by charging the majority of his CAM-paid personal expenses to a slush fund on CAM’s books. The slush fund was created using excess funds provided by CenterPoint and Xcel in exchange for CAM’s agreement to provide certain conservation and weatherization services to qualifying homeowners. If CAM could provide the services for less than the amounts provided by CenterPoint and Xcel, CAM was allowed to keep the difference for other CAM-related activities. CAM carried these funds on its books in a slush fund not subject to the same oversight as CAM’s state and federal grant proceeds. W. DAVIS could therefore instruct CAM’s fiscal staff to charge personal expenses to this slush fund with less risk of detection.
According to the indictment and documents filed in court, W. DAVIS used intimidation and retaliation to prevent CAM staff from informing anyone, including CAM’s Board of Directors, that he was using his position as CAM’s CEO to divert CAM funds to his personal use and that of his family and friends. For example, W. DAVIS issued written reprimands to employees, prohibited employees from communicating with state agencies and CAM’s financial auditors, threatened employees with suspension and termination, and ordered one CAM employee to look up the definitions of the words “insubordination” and “loyalty” after the employee contradicted W. DAVIS in front of other employees.
According to the indictment and documents filed in court, between March 2007 and October 2014, at least $250,000 in CAM funds intended to be used to provide services to low-income residents of Minneapolis were instead diverted to W. DAVIS’ personal use and the use of his family and friends, including JORDAN DAVIS. As part of the scheme, W. DAVIS caused CAM funds to be used for personal expenses, including airline tickets, hotel stays, rental cars and a Caribbean cruise. In total, between January 2009 and October 2014, W. DAVIS caused $77,000 of CAM funds to be used for personal travel expenses for himself and his friends and family members.
According to the indictment and documents filed in court, W. DAVIS used CAM funds to pay for his personal vehicle, a 2011 Chrysler 300. In May 2011, W. DAVIS traded in a 2005 Chrysler 300 owned by CAM. He then used the $10,079.53 in proceeds from the trade-in of the CAM vehicle toward the purchase of the 2011 Chrysler 300 for himself. W. DAVIS used CAM funds to pay the remaining $36,430 balance of the purchase price of the 2011 Chrysler 300. Nearly four months later, W. DAVIS emailed three members of the CAM Board of Directors to authorize a personal loan from CAM for the purchase of the vehicle. He did not disclose that he had already purchased the vehicle using CAM funds, nor did he disclose that he had applied the trade-in value of the CAM-owned 2005 Chrysler 300 toward the purchase of the new vehicle.
According to the indictment and documents filed in court, W. DAVIS also used CAM funds to pay JORDAN DAVIS for a no-show job at a Ben & Jerry’s ice cream shop operated by CAM. CAM operated a Ben & Jerry’s PartnerShop near the University of Minnesota campus in Minneapolis. Ben & Jerry’s waived its standard franchise fees so that CAM could use the store to offer job and entrepreneurial training to underprivileged youth facing barriers to employment.
According to the indictment and documents filed in court, between 2002 and October 2006, WILLIAM DAVIS’s son JORDAN DAVIS, worked as the manager of the Ben & Jerry’s PartnerShop. In October 2006, J. DAVIS obtained employment with the Minneapolis Police Department, and thereafter stopped working at the Ben & Jerry’s. CAM hired a new manager for the store a few months later.
According to the indictment and documents filed in court, W. DAVIS instructed CAM’s fiscal staff to continue issuing J. DAVIS the full paycheck he had been receiving for managing the ice cream shop. W. DAVIS concealed this from CAM’s Board of Directors. From at least March 2007 until January 2011, J. DAVIS continued to receive his full paycheck, $1,320 biweekly, for his work at the Ben & Jerry’s, even though he was doing no work for the ice cream shop. J. DAVIS endorsed and deposited the paychecks every two weeks. In total, J. DAVIS endorsed and deposited at least 105 paychecks for his no-show job.
According to the indictment and documents filed in court, during the nearly four years that J. DAVIS was being paid for his no-show job, CAM’s fiscal staff repeatedly advised W. DAVIS to stop the payments, but W. DAVIS refused. On December 20, 2010, W. DAVIS sent an email to CAM’s CFO in which W. DAVIS agreed that J. DAVIS’s “last day on payroll for Ben & Jerry’s is Dec. 31st.” W. DAVIS instructed CAM’s CFO to issue J. DAVIS his ordinary payroll check on December 31st, along with a “bonus check for $6,000.” As a result of W. DAVIS and J. DAVIS’s fraud scheme, CAM paid J. DAVIS more than $140,000 for a job he did not perform. In April 2011, CAM closed the Ben & Jerry’s PartnerShop because CAM could no longer afford the rent for the store, and CAM terminated its youth job skills training program.
According to the indictment and documents filed in court, in October 2013, the Minnesota Department of Human Services (DHS) began an audit intended to determine whether CAM was using the federal and state grant funds that it received through DHS in accordance with the applicable contracts. DHS personnel sought documents and information about the purposes of various CAM expenditures. Throughout the first several months of 2014, W. DAVIS resisted DHS’s requests for information.
According to the indictment and documents filed in court, in May 2014, DHS provided a draft audit report to W. DAVIS, as well as to CAM’s CFO and the Chair of CAM’s Board of Directors. The draft audit indicated unallowable travel expenses for W. DAVIS had been charged to the grants. W. DAVIS subsequently sent correspondence containing false material representations about his personal travel. On June 3, 2014, W. DAVIS attended a meeting with DHS personnel to discuss the report’s findings. Two days later, W. DAVIS flew to Phoenix, Ariz., to visit his girlfriend using an airline ticket he caused to be purchased with CAM funds. On October 13, 2014, W. DAVIS was suspended from his position as CEO without pay.
This case is the result of an investigation conducted by the Federal Bureau of Investigation, Internal Revenue Service – Criminal Investigation, United States Department of Health and Human Services Office of the Inspector General and the United States Department of Energy Office of the Inspector General.
This case is being prosecuted by Assistant United States Attorney Kimberly A. Svendsen.
Defendant Information:
WILLIAM JAMES DAVIS, 64
Brooklyn Park, Minn.
Charges:
- Conspiracy to commit theft concerning programs receiving federal funds, 1 count
- Mail fraud, 10 counts
- Wire fraud, 1 count
- Theft concerning programs receiving federal funds, 4 counts
JORDAN JAMES DAVIS, 34
Otsego, Minn.
Charges:
- Conspiracy to commit theft concerning programs receiving federal funds, 1 count
- Mail fraud, 5 counts
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
The charges contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Twin Cities Somali Community Leaders, Government Officials and Private Partners Present Plan to Build Community ResilienceRead the Press Release
United States Attorney Andrew M. Luger today was joined by public and private partners in the Building Community Resilience pilot project to announce the project’s first-year accomplishments. Building Community Resilience was designed in close coordination with Minnesota’s Somali community, government stakeholders and private partners to address the root causes of radicalization.
Since Al Shabaab began recruiting Minnesota’s youth in 2006, the Twin Cities have been a focus of overseas terror recruiting by organizations like the Islamic State for Iraq and the Levant (ISIL). This cycle of terror recruiting has exclusively targeted Minnesota’s Somali community, which is why Building Community Resilience is delivering resources to the Somali community.
The highlights of the Building Community Resilience plan include: a mentorship program for Somali youth operated by Big Brothers Big Sisters of the Greater Twin Cities, with initial funding from the Carlson Family Foundation; the Opportunity Hub, which is a public, private and community partnership to provide a one-stop shop for education and workforce resources located in the cedar riverside neighborhood; nearly $500,000 of private and government grant funding to be administered by Youthprise.
Youthprise is a non-profit organization that strategically combines funding, capacity building, policy advocacy, research, and youth engagement under one roof. As an intermediary, Youthprise acts as an incubator, connector and relationship broker, forging connections between community-based organizations, schools, funders, public agencies, youth and adults. Youthprise convenes stakeholders; provides training, coaching and technical assistance; and links organizations doing similar work.
“Today, at the end of the first year of work, we are announcing some of the accomplishments of the Building Community Resilience pilot program,” said U.S. Attorney Luger. “We have developed strong friendships, working relationships and important partnerships to build this plan. This is just the beginning of what we hope to accomplish, and we’re very excited about where we are today.”
“Minneapolis’ Somali community is a tremendous asset to our city,” said Minneapolis Mayor Betsy Hodges. “We must all support this community and their ability to contribute to our prosperity, or we will not be the city we need to be. The extent to which some people in the community are turning to violence as a perceived solution to problems is the extent to which we must provide actual solutions to real problems that people are facing like poverty, unemployment, and homelessness. The steps we are taking today build on our work to strengthen the Somali community. These efforts are critical to ensuring that harming others is never a solution to any problem.”
“The recruitment of a single resident from our city is unacceptable,” said Minneapolis Council Member Abdi Warsame. “My office has been working with federal, state, county and city officials to connect existing opportunities to the East African community in order to tackle the underlining conditions that make our young people vulnerable.”
“This has been one of the greatest opportunities to voice community issues that have traditionally been ignored,” said Hodan Hassan, co-chair of the Somali American Task Force. “If we save even one young person through this collaboration between community, government, and private-sector partners, our mission is accomplished.”
“We are proud to support the ‘Building Community Resilience’ initiative,” said Rich Hoge, Executive Vice President, Mall of America. “Today is about opportunity, solutions and hope. It is a first step in working together to address the challenges we face collectively. We are honored to be a partner in this exciting new program.”
“We are thrilled to be a part of this groundbreaking public/private partnership,” said Wokie Weah, President of Youthprise. “Since our inception, Youthprise has been a huge supporter of Somali-led organizations serving youth and families. Our role in this partnership will build on this work by strengthening the capacity of Somali-led organizations and providing critical funding for youth empowerment. Youthprise will conduct an open competitive process in the distribution of grant funds to community based organizations.”
“We're pleased that Big Brothers Big Sisters of the Greater Twin Cities will be part of this important initiative,” said Gloria Lewis, CEO, Big Brothers Big Sisters of the Greater Twin Cities. “Mentoring helps to foster success in school, improve social and emotional learning, and raise educational expectations. We’re eager to work with the Somali-American community in the Twin Cities bring the positive effects of mentoring to youth who can benefit from the presence of an additional, caring adult, and to help nurture the next generation of our community's citizens and leaders.”
“That I (as a minority member) was able to get this into a major Appropriations bill late in the process indicates the legislatures understanding of the importance of this issue and the need for new approaches,” said State Representative Phyllis Kahn. “I am pleased to be here at this next step.”
Building Community Resilience partners include:
Big Brothers Big Sisters of the Greater Twin Cities
Carlson Family Foundation
City of Minneapolis
City of St. Paul
Hennepin County
Mall of America
Somali-American Task Force
State of Minnesota
Youthprise
United States Transportation Security Administration
United States Customs and Border Protection
United States Department of Justice
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Minneapolis Man Pleads Guilty to Conspiracy to Provide Material Support to ISILRead the Press Release
Defendant is the Second of Nine Co-Conspirators to Plead Guilty
Hanad Mustofe Musse, 19, of Minneapolis, pleaded guilty today to conspiring with at least eight other individuals to travel to Syria in an effort to provide material support to the Islamic State of Iraq and the Levant (ISIL), a designated foreign terrorist organization. Musse was initially charged by criminal complaint on April 20, 2015, and was subsequently indicted on May 19, 2015. Musse pleaded guilty today before Senior U.S. District Judge Michael J. Davis of the District of Minnesota.
Assistant Attorney General for National Security John P. Carlin and U.S. Attorney Andrew M. Luger of the District of Minnesota made the announcement.
“Hanad Mustofe Musse conspired to provide material support to ISIL and attempted to travel to Syria to join their ranks overseas,” said Assistant Attorney General Carlin. “The National Security Division’s highest priority is counterterrorism and we will continue to pursue justice against those who seek to provide material support to designated foreign terrorist organizations.”
“The facts set forth in Mr. Musse’s guilty plea underscore the length and breadth of this criminal conspiracy,” said U.S. Attorney Luger. “This defendant made multiple attempts to leave Minnesota to join ISIL – criminal prosecution was the best remaining option to stop him and potentially save his life. Twin Cities’ youth continue to be the targets of an intense recruiting campaign by ISIL. Fighting back is the shared responsibility of a wide cross-section of Minnesotans – parents, religious leaders, teachers, community leaders and law enforcement. We must continue to work together to end the cycle of recruiting.”
As the defendant admitted in his guilty plea, between March and June 2014, Musse became aware of individuals in the United States and abroad who had traveled or desired to travel overseas to join ISIL. Musse joined this group of aspiring travelers with the understanding that ISIL was a designated foreign terrorist organization that engaged in terrorism and terrorist activity. The defendant participated in several meetings throughout 2014 in which he and his co-conspirators discussed traveling to Syria to join ISIL, including how they would pay for such travel, what routes they could take from Minnesota to Syria to best elude law enforcement and the feasibility of using fraudulent travel documents to travel to Syria.
Musse also admitted in his plea that by June 2014, he knew that co-conspirator Abdi Nur had successfully traveled to Syria and that co-conspirator Abdullahi Yusuf had attempted to travel to Syria but had been stopped by law enforcement at the Minneapolis/St. Paul, Minnesota, International Airport. Nevertheless, Musse continued to make preparations to travel to Syria to join ISIL. Between Oct. 20, 2014, and Nov. 6, 2014, Musse made five cash withdrawals from his federal financial aid account totaling $2,400. He deposited those funds in a personal checking account that he opened on Nov. 3, 2014. Musse later used those funds to purchase a bus ticket from Minneapolis to New York City.
As admitted by the defendant in his guilty plea, on Nov. 6, 2014, Musse and co-conspirators Mohamed Farah, Hamza Ahmed and Zacharia Abdurahman purchased bus tickets from Minneapolis to New York City, where they met at John F. Kennedy International Airport (JFK). While at JFK, Musse purchased a round-trip ticket to Athens, Greece, which he planned to use as a transit point from which to travel to Syria. Musse knew that Abdurahman purchased a ticket on the same flight for the same purpose. After being prevented by federal agents from boarding his flight, Musse lied to the agents about the true nature of his travel.
The defendant admitted in his guilty plea that after their failed November 2014 attempt to fly overseas, Musse and co-conspirators Mohamed Farah, Abdurahman and Ahmed met to discuss and coordinate false responses to anticipated law enforcement questions in an effort to conceal their intention to travel to Syria to join ISIL.
Musse admitted in his guilty plea that he continued to meet with his co-conspirators throughout the winter and spring of 2015 to discuss and plan another attempt to travel to Syria to join ISIL. As a result of some of those meetings, Musse willingly agreed to participate in a scheme to obtain false passports, travel from Minnesota to Mexico and fly overseas to join ISIL using those false passports. On April 6, 2015, Musse provided a passport photo of himself to a co-conspirator for the purpose of creating a fake passport. Unbeknownst to the defendant, the individual was a cooperating human source (CHS). When Musse’s family learned of his plan to travel, Musse requested the return of the photograph from the CHS. However, Musse admits that he did not withdraw from the conspiracy to provide material support to ISIL when he sought return of the passport photo. Rather, Musse was attempting to preserve the viability of his and his co-conspirators’ future travel to Syria.
This case is being investigated by the FBI-led Joint Terrorism Task Force. This case is being prosecuted by Assistant U.S. Attorneys Andrew R. Winter and John F. Docherty of the District of Minnesota, with assistance provided by the National Security Division’s Counterterrorism Section.
Hanad Musse Pleads Guilty to Conspiracy to Provide Material Support to the Islamic State of Iraq and the LevantRead the Press Release
United States Attorney Andrew M. Luger and Assistant Attorney General John P. Carlin today announced the guilty plea of HANAD MUSTOFE MUSSE, 19, who conspired with at least eight other individuals to travel to Syria in an effort to provide material support to the Islamic State of Iraq and the Levant (ISIL), a designated foreign terrorist organization. MUSSE was initially charged by criminal complaint on April 20, 2015, and was subsequently indicted on May 19, 2015. MUSSE pleaded guilty today before Senior U.S. District Judge Michael Davis in United States District Court in Minneapolis, Minn.
“The facts set forth in Mr. Musse’s guilty plea underscore the length and breadth of this criminal conspiracy,” said U.S. Attorney Luger. “This defendant made multiple attempts to leave Minnesota to join ISIL – criminal prosecution was the best remaining option to stop him and potentially save his life. Twin Cities’ youth continue to be the targets of an intense recruiting campaign by ISIL. Fighting back is the shared responsibility of a wide cross-section of Minnesotans – parents, religious leaders, teachers, community leaders and law enforcement. We must continue to work together to end the cycle of recruiting.”
“Hanad Mustofe Musse conspired to provide material support to ISIL and attempted to travel to Syria to join their ranks overseas,” said Assistant Attorney General Carlin. “The National Security Division's highest priority is counterterrorism and we will continue to pursue justice against those who seek to provide material support to designated foreign terrorist organizations.”
As admitted by the defendant in his guilty plea, between March and June 2014, MUSSE became aware of individuals in the United States and abroad who had traveled or desired to travel overseas to join ISIL. MUSSE joined this group of aspiring travelers with the understanding that ISIL was a designated foreign terrorist organization that engaged in terrorism and terrorist activity. The defendant participated in several meetings throughout 2014 in which he and his co-conspirators discussed traveling to Syria to join ISIL, including how they would pay for such travel, what routes they could take from Minnesota to Syria to best elude law enforcement, and the feasibility of using fraudulent travel documents to travel to Syria.
As admitted by the defendant in his guilty plea, by June 2014, MUSSE knew that co-conspirator Abdi Nur had successfully traveled to Syria and that co-conspirator Abdullahi Yusuf had attempted to travel to Syria but had been stopped by law enforcement at the Minneapolis/St. Paul International Airport. Nevertheless, MUSSE continued to make preparations to travel to Syria to join ISIL. Between October 20, 2014, and November 6, 2014, MUSSE made five cash withdrawals from his federal financial aid account totaling $2,400. He deposited those funds in a personal checking account that he opened on November 3, 2014. He later used those funds to purchase a bus ticket from Minneapolis to New York City.
As admitted by the defendant in his guilty plea, on November 6, 2014, MUSSE and co-conspirators MOHAMED FARAH, HAMZA AHMED, and ZACHARIA ABDURAHMAN purchased bus tickets from Minneapolis to New York City, where they met at John F. Kennedy International Airport (JFK). While at JFK, MUSSE purchased a round-trip ticket to Athens, Greece, which he planned to use as a transit point from which to travel to Syria. MUSSE knew that ABDURAHMAN purchased a ticket on the same flight for the same purpose. After being prevented by federal agents from boarding his flight, MUSSE lied to the agents about the true nature of his travel.
As admitted by the defendant in his guilty plea, after their failed November 2014 attempt to fly overseas, MUSSE and co-conspirators MOHAMED FARAH, ABDURAHMAN, and AHMED met to discuss and coordinate false responses to anticipated law enforcement questions in an effort to conceal their intention to travel to Syria to join ISIL.
As admitted by the defendant in his guilty plea, he continued to meet with his co-conspirators throughout the winter and spring of 2015 to discuss and plan another attempt to travel to Syria to join ISIL. As a result of some of those meetings, MUSSE willingly agreed to participate in a scheme to obtain false passports, travel from Minnesota to Mexico, and fly overseas to join ISIL using those false passports. On April 6, 2015, MUSSE provided a passport photo of himself to a co-conspirator for the purpose of creating a fake passport. Unbeknownst to the defendant, the individual was a cooperating human source (CHS). When MUSSE’s family learned of his plan to travel, MUSSE requested the return of the photograph from the CHS. However, MUSSE admits that he did not withdraw from the conspiracy to provide material support to ISIL when he sought return of the passport photo. Rather, MUSSE was attempting to preserve the viability of his and his co-conspirators’ future travel to Syria.
This case is the result of an investigation conducted by the FBI-led Joint Terrorism Task Force.
This case is being prosecuted by Assistant United States Attorneys Andrew R. Winter and John Docherty with assistance provided by the National Security Division's Counterterrorism Section.
Defendant Information:
HANAD MUSTOFE MUSSE, 19
Minneapolis, Minn.
Convicted:
- Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Former Minnesota Real Estate Developer Sentenced to 78 Months in Prison and $1.5 Million Special Assessment for Tax Evasion, Mail and Wire FraudRead the Press Release
United States Attorney Andrew M. Luger today announced the sentencing of BARTOLOMEA JOSEPH MONTANARI, 57, formerly of Bayport, Minn., to 78 months of imprisonment for tax evasion and fraud.
On May 21, 2014, MONTANARI was indicted with one count of Evasion of Payment of Taxes, one count of Mail Fraud, and one count of Wire Fraud. On November 25, 2014, following a 6-day trial, a federal jury found MONTANARI guilty on all counts. On September 9, 2015, U.S. District Judge Ann D. Montgomery sentenced MONTANARI to 78 months, or 6 ½ years, of imprisonment. Judge Montgomery further ordered MONTANARI to pay mandatory restitution of $100,000 and, additionally, to pay more than $1.5 million as a special assessment for the taxes, interest, and penalties owed.
The evidence presented at trial proved that from 2009 until January 2012, MONTANARI willfully evaded the payment of employment and excise taxes owed by him and the three businesses he controlled: St. Croix Development, Emlyn Coal Processing, and Montie’s Resources. One of the ways MONTANARI avoided paying taxes was by transferring over $1.1 million into a bank account in the name of Bella Luca Properties LLC (“Bella Luca”), a shell company with no legitimate business purpose but used by MONTANARI to pay personal expenses. MONTANARI evaded payment of more than $700,000 in taxes and to the federal government.
In December 2009, when the IRS attempted to collect taxes and TFRPs, MONTANARI filed a fraudulent financial statement making numerous misrepresentations to the IRS to avoid paying the taxes he owed. For example, he failed to disclose multiple personal vehicles that he owned and he denied the existence of the Bella Luca bank account, which he was using to receive monthly compensation of $50,000 from two of his companies. MONTANARI also falsely claimed to be living in Bayport, Minnesota, when, in truth, he had already moved into a $1.4 million house he was purchasing in Knoxville, Tennessee.
In addition, as part of a fraud scheme, MONTANARI lied about the sale price of a Caterpillar bulldozer that he needed to purchase for one of his companies. MONTANARI submitted a falsified invoice to the dozer financing company, which issued a check for the dozer for $100,000 more than the true purchase price. MONTANARI kept the extra $100,000 and used it as a down payment for his house in Tennessee.
“Business owners have a responsibility to pay excise taxes, and turn over their employees’ employment taxes withheld from their paychecks, to the Internal Revenue Service,” said Special Agent in Charge Shea Jones of the IRS Criminal Investigation. “This sentence should send a clear message; schemes to evade the payment of taxes are a violation of the Federal Tax Laws and the consequences of such schemes can and will result in significant jail time.”
“Montanari not only evaded payment of taxes and defrauded his business partner, but he repeatedly lied to IRS investigators, pleading poor while living an extravagant lifestyle,” said Assistant United States Attorney Melinda A. Williams. “Today’s sentence sends a strong message to those who would try to cheat the government that this behavior will not be tolerated.”
In sentencing MONTANARI, Judge Montgomery noted that the defendant used the money he stole to finance an “incredibly flamboyant lifestyle,” that this was “not a single error of judgment,” and that MONTANARI had “many chances” to correct his behavior, but did not. Therefore, Judge Montgomery said she focused her sentence on “what will get the message across.”
This case is the result of an investigation by the Internal Revenue Service-Criminal Investigation Division, the U.S. Postal Inspection Service, and the Minnesota Financial Crimes Task Force.
Assistant U.S. Attorney Melinda A. Williams prosecuted this case.
Defendant Information:
BARTOLOMEA JOSEPH MONTANARI, 57
Knoxville, Tenn.
Convicted:
- Evasion of Payment of Taxes, 1 count
- Mail Fraud, 1 count
- Wire Fraud, 1 count
Sentenced:
- 78 months in federal prison
- $1.5 million special assessment
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Restaurant Owner Pleads Guilty to $400,000 Tax Fraud SchemeRead the Press Release
United States Attorney Andrew M. Luger today announced the guilty plea of DEXI ZHENG, 33, to filing a false federal income tax return. ZHENG was charged on July 6, 2015, by felony information, with one count of filing a false individual tax return. He pleaded guilty on August 21, 2015, before U.S. District Judge Ann D. Montgomery in U.S. District Court in Minneapolis, Minn. A sentencing date has not yet been determined.
“Individuals who corruptly violate the tax law to further their business interests and intentionally falsify their tax returns undermine public confidence in our tax system and unfairly disadvantage businesses that play by the rules,” stated Special Agent in Charge Shea Jones of the IRS Criminal Investigation Division. “The IRS Criminal Investigation Division, together with the U.S. Attorney’s Office, will investigate and prosecute those who violate our tax system.”
According to his guilty plea and documents filed in court, from at least 2009 to 2013, ZHENG was the owner of two restaurants located in St. Michael and Big Lake, Minn. As owner of the restaurants, the defendant was responsible for reporting the profit or loss from the two restaurants on his federal individual income tax returns.
According to his guilty plea and documents filed in court, from at least 2009 to 2013, ZHENG avoided paying taxes on the full amount of the restaurants’ revenue in at least two ways. First, ZHENG intentionally failed to deposit any of the cash receipts into the restaurants’ bank accounts and failed to report the restaurants’ cash receipts on his Schedule C. Second, ZHENG recruited his father, G.Z., to act as a nominee and include the profits from the St. Michael restaurant on G.Z.’s individual income tax returns even though he was not the actual owner of the restaurant. In doing so, ZHENG caused G.Z. to exclude the St. Michael restaurant’s cash receipts from G.Z’s Schedule C. The total loss caused by ZHENG is approximately $420,000.
ZHENG faces up to three years in prison.
This case is the result of an investigation conducted by the Internal Revenue Service – Criminal Investigation Division.
This case is being prosecuted by Assistant U.S. Attorney Kimberly A. Svendsen.
Defendant Information:
DEXI ZHENG, 33
St. Michael, Minn.
Convicted:
- Filing a False Individual Tax Return, 1 count
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
More Than 1,000 Stakeholders from Throughout Minnesota Convene to Define the Problem with Prescription Painkillers and Develop SolutionsRead the Press Release
Today in Minneapolis, more than 1,000 law enforcement, public health officials, health care professionals, attorneys, drug court representatives, medical students, state, tribal and local government staff, community leaders, recovering addicts and their families from across Minnesota are meeting to address the pain pill problem. The Pain.Pill.Problem. conference brings together experts from the medical, public health and law enforcement fields to look at all sides of opioid abuse and ultimately develop solutions to the problem.
The conference consists of six panels on the following topics:
- The Impact of Opioid Addiction
- Prescribing & Pain Culture
- Pharmacy & Distribution
- Law Enforcement
- Opioid Treatment
- Recovery, Prevention & the Role of Community
Conferees will also hear from speakers on these important issues, including Minnesota Governor Mark Dayton, United States Senator Amy Klobuchar, United States Congressman Tom Emmer, The Honorable Mary Bono, University of Minnesota President Eric Kaler, Dick Beardsley, and others.
“Each case of opioid diversion and addiction represents lives ruined, careers tossed aside and tragic collateral consequences,” said U.S. Attorney Andrew M. Luger. “Doctors, pharmacists, political leaders, legislators, regulators, and civic leaders must address this problem without finger pointing or blame. We need to work together to come up with solutions and that is what the Pain.Pill.Problem. conference is all about. We owe it to our kids, we owe it to our neighbors and we owe it to each other.”
“Narcotic painkillers are being over-prescribed in Minnesota, leading to addiction, abuse and serious consequences. In the last decade, overdose deaths have more than doubled. Painkillers now cause more deaths than heroin and cocaine combined. We need to have a conversation as a society about how we can treat pain in ways that restores function and this conference is a step in the right direction,” said Minnesota Department of Human Services Commissioner Lucinda Jesson.
“Prescription drug abuse has reached crisis levels, and we should leave no stone unturned in our efforts to reverse this deadly trend,” said United States Senator Amy Klobuchar. “I was proud to participate in today’s critical summit on developing new tools and sharing best practices to help fight this devastating epidemic. I will continue to work with all those who share my commitment to combatting prescription drug abuse on behalf of Minnesota families.”
“The sobering truth is more Minnesotan’s are dying from prescription drugs than virtually all other drugs combined,” said Drug Enforcement Administration Assistant Special Agent in Charge Dan Moren. “The source of these pills is not a foreign based drug cartel. The responsibility of reversing this deadly trend rests with our domestic law enforcement, medical/health care, pharmaceutical, and addiction treatment communities changing the way they do business – it starts by learning the facts at the Pain.Pill.Problem. Summit. The public is reminded to properly dispose of all unused and/or expired prescription drugs at the nearest collection site – this service is free and anonymous. For more information, visit www.DEA.gov.”
“Minnesota is facing the same crisis that the rest of the country is,” said the Honorable Mary Bono. “Opioid misuse, and now heroin use, have overtaken our communities like a plague. I applaud the organizers and supporters of the Pain.Pill.Problem. event and thank them for stepping up to address the crisis. Countless lives hang in the balance.”
“Too many people are dying every day across Minnesota from opioid overdose. Those deaths are preventable. I urge every family and community leader to learn what they can do to educate our youth and to take proactive steps to prevent addiction and overdose,” said Hennepin County Sheriff Rich Stanek. “As Sheriff of Hennepin County, I am proud of the partnerships among local, state, federal, and tribal law enforcement agencies to dismantle criminal drug operations and promote prevention.”
“For Minnesota to make progress on the issue of opioids it will require collaboration and engagement by all the stakeholders,” said Dr. W. Michael Hooten, a pain specialist and anesthesiologist at Mayo Clinic. “This conference offered a convening opportunity and I’m optimistic that we can take our learnings and move forward together.”
“This gathering today proves we’re all in this together,” said Nick Motu, Vice President of the Hazelden Betty Ford Institute for Recovery Advocacy. “We’ve made addressing the opioid crisis a bedrock of the advocacy efforts at our organization, and by coming together with others around solutions like we did today, we can make real progress against this epidemic.”
“There are no simple solutions for opiate addiction. To make a meaningful difference, we will need to engage a broad-based coalition,” said Brooks Jackson, MD, dean of the Medical School and vice president of Health Sciences at the University of Minnesota. “This conference is a great first step. We look forward to continuing this work going forward, addressing broader issues like health policy as well as day-to-day issues around care delivery and treatment of addiction.”
For more information, please visit: www.painpillproblem.com
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Investment Advisor Indicted for Defrauding Investors of More Than $1.2 MillionRead the Press Release
The United States Attorney’s Office for the District of Minnesota announced the indictment of DAVID BLAINE WELLIVER, 55, for defrauding investors in the Dblaine Fund, a mutual fund for which WELLIVER acted as investment adviser, of at least $1.2 million. The defendant is scheduled to make an initial appearance on September 3, 2015, in U.S. District Court in St. Paul, Minn.
According to the indictment, throughout most of 2010, the Dblaine Fund had only a small number of individual investors. In March 2010, in order to increase the Dblaine Fund’s net assets, WELLIVER entered into an agreement in which, in exchange for a payment of approximately $100,000 to another investment adviser, the Dblaine Fund would acquire the assets of two other mutual funds, the Bryce Capital Growth Fund and the Bryce Capital Value Fund (Bryce Funds).
According to the indictment, because WELLIVER’s investment advisory business had never generated substantial revenues, it lacked the capital to finance the merger between the Dblaine Fund and the Bryce Funds. As of June 30, 2010, WELLIVER’s investment advisory company, Dblaine Capital, had less than $200 in liquid assets. During the same time period, WELLIVER had less than $2,000 in his personal bank accounts, and WELLIVER personally owed millions of dollars in civil judgments, federal income taxes, and other debts. Through his company Dblaine Capital, WELLIVER borrowed money from Lazy Deuce Capital Company, LLC (Lazy Deuce), a limited liability company based in Burnsville, Minn., to finance the merger between the Dblaine Fund and the Bryce Funds. On or about December 8, 2010, WELLIVER used funds borrowed from Lazy Deuce to make a $95,000 payment to the Bryce Funds’ investment adviser, and thereafter the merger was completed. As a result of the merger, the Dblaine Fund’s assets under management increased from approximately $500,000 to over $9 million.
According to the indictment, as part of the scheme to defraud investors in the Dblaine Fund, WELLIVER, in 27 separate transactions between October 2010 and May 2011, borrowed a total of $4 million from Lazy Deuce. Aside from the $95,000 payment to acquire the assets of the Bryce Funds, WELLIVER did not use any of the other proceeds of the Lazy Deuce loans to acquire mutual funds as he had represented to Lazy Deuce. Instead, WELLIVER diverted over $500,000 in proceeds from the Lazy Deuce loans to his own personal use, including for landscaping and interior decorating at his personal residence, to purchase land adjacent to his personal residence, to buy a personal vehicle, and to pay for his son’s college tuition.
According to the indictment, in exchange for Lazy Deuce’s agreement to lend funds to Dblaine Capital, WELLIVER agreed to use his position as investment adviser to the Dblaine Fund to cause Dblaine Fund investors’ money to be invested back into Lazy Deuce. In exchange for Lazy Deuce’s agreement to lend funds to Dblaine Capital, WELLIVER agreed to invest money from the Dblaine Fund back in Lazy Deuce. However, in order to conceal the nature of this transaction from the Dblaine Fund’s investors, its Board of Trustees, and its other service providers, WELLIVER made these investments into a shell company formed by several Lazy Deuce principals, called Semita Partners LLC (Semita).
According to the indictment and documents filed in court, between December 16, 2010, and April 15, 2011, WELLIVER caused $1.725 million in Dblaine Fund investors’ money to be invested in Semita. At the time WELLIVER made the investments in Semita, he knew that Semita was a shell company formed by principals of Lazy Deuce – the same company from which Dblaine Capital had borrowed money – and that Semita had no operations. On December 31, 2010, in order to meet a series of redemptions in the Dblaine Fund, Welliver liquidated nearly all of the stocks held by the Dblaine Fund. Following this liquidation, the Dblaine Fund’s only holdings consisted of worthless Semita shares and cash held in a money market account.
This case is the result of an investigation conducted by the United States Postal Inspection Service, the Federal Bureau of Investigation, and the Internal Revenue Service – Criminal Investigation.
This case is being prosecuted by Assistant United States Attorneys Kimberly A. Svendsen and Benjamin F. Langner.
Defendant Information:
DAVID BLAINE WELLIVER, 55
Buffalo, Minn.
Charges:
- Wire fraud, 5 counts
- Mail fraud, 4 counts
- Money laundering, 5 counts
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
The charges are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Used Car Salesman Sentenced to 24 Months in Prison and Ordered to Pay $96,599.76 in RestitutionRead the Press Release
United States Attorney Andrew M. Luger today announced the sentencing of JAMES FRANCIS VOLIN, 65, of Inver Grove Heights, to 24 months in prison for hiding income from used car sales from the Internal Revenue Service for two years. VOLIN was indicted on May 21, 2014 and pleaded guilty to Income Tax Evasion on November 18, 2014. He was sentenced on August 13, 2015, before Senior Judge Michael J. Davis in U.S. District Court in Minneapolis, Minn.
“Taxpayers thinking about participating in fraudulent tax schemes, including failing to report all forms of income, should stop in their tracks and simply look at the consequences of taking the next step,” stated Special Agent in Charge Shea Jones of the IRS Criminal Investigation. “To build faith in our nation’s tax system, honest taxpayers need to be reassured that everyone is paying their fair share. Today’s sentencing of Mr. Volin shows how seriously the courts take federal tax crimes.”
According to his guilty plea and documents filed in court, in 2008 VOLIN agreed to pay nearly $100,000 in outstanding taxes to the IRS. VOLIN still owed the taxes in 2012 and 2013 when he was operating an unlicensed and illegal used car dealership which generated substantial income in cash. Instead of paying the back taxes as agreed, VOLIN hid the income. VOLIN admitted that he did not report the cash income or file tax returns and that he put money into cashier’s checks and used bank accounts opened under another’s name and social security number to avoid detection.
This case is the result of an investigation by the Internal Revenue Service – Criminal Investigations and the Minnesota State Patrol Vehicle Crimes Unit.
The case was prosecuted by Assistant United States Attorney Robert Lewis.
Defendant Information:
JAMES FRANCIS VOLIN, 65
Inver Grove Heights, MN
Convicted:
- Income Tax Evasion, 1 count
Sentenced:
- 24 months in prison
- $96,599.76 in restitution
###
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Member of 19-Block Dipset Gang Sentenced to 87 Months in Prison for Possession of A FirearmRead the Press Release
United States Attorney Andrew M. Luger today announced the sentencing of MARTEL JAVELL EINFELDT, a/k/a “Peanut,” 26, to 87 months in federal prison, the top of the federal guideline range, for illegally possessing a firearm after having been previously convicted of two felonies in Hennepin County. The defendant, who was indicted on September 16, 2014, entered a guilty plea on January 21, 2015. EINFELDT was sentenced on August 12, 2015, before Judge Susan R. Nelson in U.S. District Court in St. Paul, Minn.
According to the defendant’s guilty plea and documents filed in court, on June 25, 2014, EINFELDT was found in possession of a Smith and Wesson, semi-automatic pistol. EINFELDT is a confirmed member of the 19-Block Dipset gang, whose members individually and collectively have engaged in patterns of violent criminal activity from 2006 until the present. EINFELDT warned law enforcement that members of a rival gang, the Taliban/Y.N.T. gang, would “get theirs,” for killing Tyrone Washington in 2013, the leader of the 19-Block Dipset gang. EINFELDT was previously convicted in Hennepin County for aggravated robbery and simple robbery, both felonies.
Assistant U.S. Attorney David Steinkamp said: “The defendant has personally suffered for being a member of the 19-Block Dipset. He has been shot twice, in the chest and in the face, lost his half-sister to gang violence, and has predicted he will be dead in three years. Hopefully, this lengthy prison sentence will give the defendant the chance to change the course of his life and prevent his prediction from becoming a reality.”
This case is part of a continuing effort by state and federal law enforcement to focus prosecutive resources on violent gang members who terrorize neighborhoods filled with law abiding, hard working citizens. This case was investigated by the Brooklyn Park Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Assistant United States Attorney David Steinkamp prosecuted this case.
Defendant Information:
MARTEL JAVELL EINFELDT, 26
Brooklyn Park, Minn.
Convicted:
- Felon in Possession of a Firearm, 1 count
Sentenced:
- 87 months in federal prison
- Three years supervised release
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Houston, Texas-Area Teenager Pleads Guilty to “Swatting” and Making Bomb Threats to Minnesota High SchoolRead the Press Release
United States Attorney Andrew M. Luger today announced the guilty plea of ZACHARY LEE MORGENSTERN, 19, to calling in multiple false bomb threats, making harassing text messages, and making “swatting” phone calls, in which he falsely reported hostage situations. MORGENSTERN was arrested in Texas on May 14, 2015, and was transported to Minnesota. He pleaded guilty today before U.S. District Judge Joan N. Ericksen in U.S. District Court in Minneapolis, Minn.
“‘Swatting’ is dangerous to victims and a significant drain on scarce law enforcement resources,” said U.S. Attorney Andrew M. Luger. “This defendant made swatting attacks, bomb threats and threats to shoot students at schools in Minnesota, in an attempt to harass and intimidate. Schools in Marshall were disrupted by these threats and law enforcement was forced to deploy in order to address imagined hostage situations. The FBI and U.S. Attorney’s Office will not allow such threats to go unanswered.”
According to the defendant’s guilty plea and documents filed in court, between October 2014 and May 2015, MORGENSTERN, made a series of threatening communications against a number of different victims in the Marshall, Minnesota area. The defendant, cloaking himself in anonymized email addresses, Twitter handles, and Internet-based phone accounts, made threats to kill a police officer and her family; threats to use explosives to blow up a school; and threats to use guns to shoot up a school. MORGENSTERN also engaged in a series of “swatting” attacks, in which he made hoax phone calls to law enforcement making it appear that there was a violent crime in progress at a residence, when in fact no such crime was taking place. The defendant engaged in these “swatting” calls with the intent that they would result in an emergency police response to the residence, ideally involving a Special Weapons and Tactics (SWAT) team.
According to the defendant’s guilty plea and documents filed in court, one such attack came on October 7, 2014, when MORGENSTERN called the Marshall Police dispatch center and claimed to have taken two people hostage at a residence of H.M., a minor, in Marshall. MORGENSTERN further claimed that he had shot one of the hostages in the knee cap and that he was going to kill both hostages unless he received a duffel bag containing a half a million dollars. The Marshall Police Department determined that call was a hoax.
According to the defendant’s guilty plea and documents filed in court, beginning on January 6, 2015, MORGENSTERN, claiming to be D.R., a 17-year-old from Marshall, made at least three separate bomb threats to Marshall High School. Approximately four hours after the first threat was called in on January 6, MORGENSTERN used the twitter handle @RIURichHomie, to tweet to D.R., “OOPS. NICE BOMB THREAT. TEEHEEEEEEEE :).” MORGENSTERN later sent a tweet to both D.R. and his friend, S.V., in which he claimed responsibility for the bomb threat.
According to the defendant’s guilty plea and documents filed in court, on January 8, 2015, MORGENSTERN twice called the Marshall Police Department dispatcher. During those calls, MORGENSTERN claimed to have taken hostage a father and son in their home in Marshall. The address provided to police was the residence of D.R. Shortly after each call to Marshall Police, MORGENSTERN tweeted D.R. that he was in the process of “swatting” D.R.
According to the defendant’s guilty plea and documents filed in court, on January 9, 2015, MORGENSTERN called the Marshall Police dispatch and, claiming to be D.R., threatened to “shoot up” Marshall High School in 30 minutes and kill everybody. MORGENSTERN then tweeted from the account, @RIURichHomie that D.R. was going to shoot up a school in 10 minutes. On January 11, 2015, an email was sent to the Superintendent of the Marshall Public Schools, which had purportedly been sent by D.R. The sender claimed to be D.R. and that D.R. and had planted a bomb in at a Marshall, Minn., school that would detonate at 10:00 a.m. the following day. The sender also claimed that he/she would arrive at a different Marshall school at the same time and shoot students and faculty members.
According to the defendant’s guilty plea and documents filed in court, MORGENSTERN engaged in additional threats, harassment, and swatting attacks against individuals in other states. For example, on or about December 24, 2014, the defendant called the Amelia, Ohio Police dispatch center and claimed to be a boy hiding in the closet while a home invasion was in progress. He falsely stated that he was calling from a residence in Amelia, and that three men broke into his house and shot his mother. On or about February 10, 2015, the defendant contacted the Amesbury, Massachusetts Police dispatch center and claimed to be a boy hiding in his closet at an address that was the residence of G.Q, a minor. He falsely stated that four black men had broken into his residence and shot his mother. The call resulted in an armed police entry into the residence, after which police concluded the call was a hoax.
“The multiple calls to law enforcement and the Marshall High School spread fear and taxed the resources of the Police Department and the school,” said Marshall Police Chief Rob Yant. “Even after the first couple of threats, when it appeared that they were being done as a hoax, we had to take them seriously because what if we hadn’t and they turned out to be real? The Internet has made us vulnerable to these types of threats, even when the perpetrator turns out to be halfway across the country, and it has also made it easier for people making the threats to conceal their location and identity. Local police departments do not have the time or the expertise to investigate these cases. That is why we are so grateful for the assistance of the FBI and the US Attorney’s Office in locating and bringing the perpetrator to justice in this case.”
This case is the result of an investigation conducted by the Federal Bureau of Investigation and the Marshall Police Department.
This case is being prosecuted by the United States Attorney’s Office for the District of Minnesota.
Defendant Information:ZACHARY LEE MORGENSTERN, 19
Cypress, Tex.Convicted:
- Threats to kill, 1 count
Two Twin Cities' Restauranteurs Sentenced for Hiring Undocumented WorkersRead the Press Release
United States Attorney Andrew M. Luger today announced the sentencing of MING GUO, 46, owner of two Twin Cities restaurants, both named Hibachi Grill and Supreme Buffet, and BIJIAN WENG, a/k/a “Wilson,” 28, manager of the restaurants, to federal prison sentences for employing unlawful aliens. GUO and WENG were charged on January 26, 2015, with one count each of Knowingly Hiring Ten or More Unlawful Aliens. GUO and WENG pleaded guilty on March 20, 2015, and were sentenced yesterday by U.S. District Judge Donovan W. Frank in U.S. District Court in St. Paul, Minn.
“Hiring illegal aliens is not a victimless crime. It gives an unfair advantage to a business, forces competitors out of business, and results in lost tax revenue for the community,” said Acting Special Agent in Charge, William Lowder of HSI St. Paul. “Harboring illegal aliens is a very real crime with very real victims. HSI will remain vigilant in protecting American businesses and keeping the playing field level. ”
“These defendants created a successful restaurant business on the backs of undocumented workers,” said Assistant U.S. Attorney Julie E. Allyn. “They forced the victims to work 12-hour shifts, six days per week, by housing them and isolating them without the means and access to build a life. Guo and Weng did not simply hire illegal aliens – they took sustained steps to harbor and transport these workers in violation of U.S. law.”
According to the defendants’ guilty pleas and documents filed in court, from September 30, 2013 through September 30, 2014, GUO and WENG knowingly hired and employed at least 17 individuals who were not authorized to be employed or lawfully admitted for permanent residence in the United States. On September 30, 2014, HSI agents executed search warrants at the restaurants in Spring Lake Park and West St. Paul, Minnesota. They identified 17 undocumented workers working in the restaurants.
According to the defendants’ guilty pleas and documents filed in court, GUO and WENG were aware that the employees were not authorized to work in the United States. Moreover, the defendants did not ask the employees to fill out paperwork, including I-9 Employment Eligibility Verification forms. GUO and WENG also failed to report the unauthorized workers to the Minnesota Department of Economic Development. The employees were paid in cash “off the books.”
According to the defendants’ guilty pleas and documents filed in court, in addition to hiring illegal aliens, GUO and WENG took additional sustained steps to harbor and transport the victims. The defendants housed the victims and transported them to and from work each day. With no cars and limited family (if any) nearby, these employees were left with no choice but working at the restaurants. This allowed the defendants to profit by exploiting and using the employees to work endless hours six days each week.
This case is the result of an investigation conducted by Homeland Security Investigations.
Assistant U.S. Attorneys Julie E. Allyn and Laura M. Provinzino are prosecuting this case.
Defendant Information:
BIJIAN WENG, a/k/a “Wilson,” 28
Spring Lake Park, Minn.
Convicted:
- Knowingly Hiring Ten or More Unlawful Aliens, 1 count
Sentenced:
- Six months in prison
- Six months location monitoring
- Two years supervised release
- 100 hours of community service
- $304,827.75 money judgment and criminal fine
MING GUO, 46
North Miami Beach, Fla.
Convicted:
- Knowingly Hiring Ten or More Unlawful Aliens, 1 count
Sentenced:
- Five months in prison
- Seven months location monitoring
- Two years supervised release
- 50 hours of community service
- $304,827.75 money judgment and criminal fine
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Owner and Director of Eden Prairie Daycare Center Sentenced for Theft of Public MoneyRead the Press Release
United States Attorney Andrew M. Luger today announced the sentencing of KHADRA ABDISAFAD HIRSI, 47, to one year and one day in federal prison for stealing money in the form of child care subsidies from the U.S. Department of Health and Human Services and the State of Minnesota. HIRSI was charged on January 23, 2015, and pleaded guilty on February 4, 2015, to one count of theft of public money. The defendant was sentenced today before Judge Donovan W. Frank in U.S. District Court in St. Paul, Minn.
According to her guilty plea and documents filed in court, HIRSI was the director and co-owner of Ace DayCare Center, Inc. (Ace DayCare) in Eden Prairie, Minn. Many of the families for whom Ace DayCare provided childcare services participated in the Child Care Assistance Program, which provides low-income families with childcare assistance. HIRSI was responsible for submitting truthful and accurate billing forms for childcare services provided by Ace DayCare to families participating in the Child Care Assistance Program. Under the Child Care Assistance Program, child-daycare providers submit billing forms for reimbursement directly to the counties where qualifying families reside.
According to documents filed in court, from at least November 2011 through May 2013, HIRSI knowingly submitted Child Care Assistance Program billing forms that falsely inflated the number of children who received childcare services provided by Ace DayCare. As a result, HIRSI defrauded the U.S. Department of Health and Human Services and the State of Minnesota out of $300,000.
“When people steal from this program, children are deprived of quality child care and all Minnesotans suffer,” said Jerry Kerber, Minnesota Department of Human Services inspector general. “The sentence imposed today recognizes the seriousness of this crime and should deter others from committing fraud against this important public program. DHS is grateful for the cooperation and hard work of the many agencies in this case and we will continue to work together to aggressively target fraud in public programs.”
This case resulted from an investigation conducted by the Federal Bureau of Investigation and the U.S. Department of Health and Human Services – Office of Inspector General.
U.S. Attorney Luger thanked the Minnesota Department of Human Services for their assistance.
This case was prosecuted by Assistant U.S. Attorney John E. Kokkinen.
Defendant Information:
KHADRA ABDISAFAD HIRSI, 47
Eden Prairie, Minn.
Convicted:
- Theft of Public Money, 1 count
Sentenced:
- 1 year and 1 day in prison
- Two years supervised release
- $300,000 in restitution
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Tax Defier Sentenced to Two Years in Prison for Failing to Pay Federal Taxes for More Than Seven YearsRead the Press Release
United States Attorney Andrew M. Luger today announced the sentencing of TAMI MAE MAY, 56, to two years in federal prison for failing to pay federal taxes for more than seven years. MAY pleaded guilty on June 9, 2014, to one count of obstruction of due administration of Internal Revenue laws. MAY was sentenced on August 4, 2015, before Senior Judge David S. Doty in U.S. District Court in Minneapolis, Minn.
According to the defendant’s guilty plea and documents filed in court, from 1998 through 2004, MAY failed to file any income tax returns for the excavating business she ran with her husband, despite that fact that the business earned substantial income during that time. When notified by the IRS in April 2005 that the business owed tax debt, penalties and interest, MAY embarked on an eight-year campaign of frivolous filings, in an effort to obstruct the administration of Internal Revenue laws.
According to the defendant’s guilty plea and documents filed in court, MAY filed a host of fake documents with the IRS, including a “zero income” tax return, Forms 1099-OID falsely claiming that her husband had made payments to various IRS Revenue Officers, falsely claiming that the Mays or their business had received “original issue discounts” and had “federal tax withheld” by various banks and credit card companies, and forms claiming that the Mays were not United States Citizens, but instead were permanent residents of the “Kingdom of Heaven.”
According to the defendant’s guilty plea and documents filed in court, MAY also made nonsensical tax-defier-scheme-related statements to the IRS, including that her social security number was her “corporate fiction’s” social security number, that her family’s business was a foreign trust of which she was the trustee, and that there is no such thing as money.
This case is the result of an investigation conducted by the Internal Revenue Service-Criminal Investigations.
Assistant U.S. Attorney Kimberly A. Svendsen prosecuted the case.
Defendant Information:
TAMI MAE MAY, 56
Anoka, Minn.
Convicted:
- Obstruction of due administration of Internal Revenue laws, 1 count
Sentenced:
- 2 years in prison
- 1 year supervised release
- $192,495 in restitution
###
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Seven Members of South Minneapolis Gang Indicted for Violent Drug Trafficking ConspiracyRead the Press Release
United States Attorney Andrew M. Luger, ATF Special Agent in Charge for the St. Paul Field Division James C. Modzelewski, Minneapolis Police Chief Janeé Harteau and Hennepin County Attorney Michael O. Freeman today announced a federal indictment charging seven members of the 10z and 20z street gangs with crimes related to a multi-year gang war with their rivals, which included a shooting in August 2014 outside of the Hennepin County Medical Center. The defendants include both leaders and other members of the 10z and 20z. They are charged with conspiracy to possess firearms in the furtherance of a drug trafficking conspiracy, conspiracy to distribute controlled substances, possession with intent to distribute heroin and crack cocaine, and illegal possession of firearms and ammunition. The defendants are expected to make initial appearances today in U.S. District Court in St. Paul, Minn.
“Today’s indictment marks the sixth violent street gang that this office has indicted since 2014,” said U.S. Attorney Luger. “Street gangs trafficking heroin and other drugs in Minnesota are engaged in violence against one another and endangering the communities in which innocent civilians live and work. We are using every tool at our disposal to investigate and prosecute the members of these gangs who use firearms to protect their illegal drug trade and attempt to expand their areas of operations. Working with both federal and local law enforcement, my office remains focused on violent street gangs and the harm they cause to our communities. We will continue to go neighborhood to neighborhood to stop the gang wars that so often accompany drug trafficking.”
Minneapolis Police Chief Janeé Harteau said: “This indictment is a true testament to the partnerships and hard work of the MPD Weapons Unit, MPD’s Third Precinct Community Response Team, ATF and the Minnesota Department of Corrections. Our hope is this sends a strong message to those who participate in gang violence that they will be held accountable for putting innocent lives in danger. Over the course of the MPD investigation, more than two dozen guns have been linked to this gang, which has been responsible for 50 different shooting incidents in Minneapolis in the past year.”
Bureau of Alcohol, Tobacco, Firearms and Explosives, St. Paul Field Division Special Agent in Charge James Modzelewski said: “ATF’s core mission, enforcing laws that prohibit misuse of firearms, have placed ATF in the center of these violent gang investigations along with our local law enforcement partner, the Minneapolis Police Department. I am confident that this investigation will significantly impact the flow of illegal firearms and criminal use of those firearms on the streets.”
Hennepin County Attorney Mike Freeman said: “We are thankful the U. S. Attorney’s Office has indicted these extremely dangerous men. We have been prosecuting some of the same men, such as Percy Lacey who took part in a wild shootout by the Hennepin County Medical Center last summer. Bringing a coordinated state and federal prosecution to break up these gangs will be a big help in our mutual goal of reducing gun violence in Minneapolis.”
According to the indictment and documents filed in court, between at least January 2013 and July 2015, the defendants were active members of two closely associated street gangs known as the 10z and the 20z. The gangs operated in South Minneapolis, primarily between Franklin Avenue, and Lake Street, and I-35W and Minnehaha Avenue. Their primary purpose was to make money for the gang members through the sale of illegal drugs, including crack cocaine, heroin, and marijuana. As part of their drug trafficking operation, members of the gangs routinely engaged in gun violence with rival gangs. The purpose of this violence was to protect drug dealing territory controlled by the 10z and 20z, to protect individual drug distributors from rival gang violence, to attack and seize drug dealing territory controlled by rival gangs, and to attack and rob drug distributors associated with rival gangs.
According to the indictment and documents filed in court, the 10z and 20z were involved in a gang war with their primary rival gangs, the Bloods and the Bogus Boys. The gang war was very violent and resulted in shootings of gang members on both sides, some of which caused the death of gang members. Virtually all of these shootings were the product of disputes over territory, robberies of rival drug dealers, or retaliatory violence.
According to the indictment and documents filed in court, the defendants were involved in at least five shootings between August 19, 2014, and September 23, 2014. On August 19 2014, PERCY LACEY, JR., and other members of the 10z and 20z shot and wounded members of the Bloods near the corner of 37th Street East and Chicago Ave S. in the Powderhorn neighborhood of South Minneapolis. LACEY, JR., and his co-conspirators used a Masterpiece 9mm semi-automatic pistol to carry out the shooting. Two days later, CLARENCE DICKENS, JR., engaged in a drive-by shooting targeting a member of the Bloods outside of a McDonald’s at the corner of 2nd Avenue S and E. Lake Street.
According to the indictment and documents filed in court, on August 26, 2014, ANDREW PETERSON and LACEY JR., along with other members of the 10z and 20z, staged a coordinated attack on members of the Bloods. Members of the Bloods were at the Hennepin County Medical Center visiting an injured member of their gang who had been shot earlier that day by members of the 10z during a drive-by shooting. PETERSON stood outside the hospital and attempting to draw Bloods members outside. Once outside of the hospital, LACEY, JR., fired multiple gun shots at the Bloods from across the street.
According to the indictment and documents filed in court, on September 23, 2014, ANTHONY PIERRE DOSS was carrying the same Masterpiece 9mm used by LACEY, JR., during the August 19, 2014, shooting. While in possession of the Masterpiece, DOSS and other members of the 10z were shot at and wounded outside of a Moto Mart gas station at 3301 Hiawatha Avenue in South Minneapolis.
The indictment is the result of an investigation conducted by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Minneapolis Police Department.
This case is being prosecuted by Assistant U.S. Attorney Thomas Calhoun-Lopez.
Defendant Information:
DANIEL ALFRED ADAMS, a/k/a “Funk,” 29
Minneapolis, Minn.
Charges:
- Conspiracy to possess firearms in furtherance of a drug trafficking crime, 1 count
- Conspiracy to distribute controlled substances, 1 count
- Possession with intent to distribute heroin, 1 count
- Possession of a firearm in furtherance of a drug trafficking crime, 1 count
- Felon in possession of a firearm, 2 counts
ANDREW INDELICATO PETERSON, a/k/a “Boo Boo,” 25
St. Louis Park, Minn.
Charges:
- Conspiracy to possess firearms in furtherance of a drug trafficking crime, 1 count
- Conspiracy to distribute controlled substances, 1 count
- Felon in possession of ammunition, 1 count
PERCY MINIFER LACEY, JR., a/k/a “P3,” 22
Richfield, Minn.
Charges:
- Conspiracy to possess firearms in furtherance of a drug trafficking crime, 1 count
- Conspiracy to distribute controlled substances, 1 count
- Felon in possession of ammunition, 1 count
ANTHONY PIERRE DOSS, a/k/a “Two Tone,” a/k/a “Tony,” 24
Brooklyn Park, Minn.
Charges:
- Conspiracy to possess firearms in furtherance of a drug trafficking crime, 1 count
- Conspiracy to distribute controlled substances, 1 count
- Felon in possession of a firearm, 2 counts
THOMAS DUPREE BENNETT, a/k/a “Deandre Clay,” a/k/a “Trigga,” 27
Minneapolis, Minn.
Charges:
- Conspiracy to possess firearms in furtherance of a drug trafficking crime, 1 count
- Conspiracy to distribute controlled substances, 1 count
- Felon in possession of ammunition, 1 count
PAUL ANTONIO EARLY, a/k/a “Stamps,” a/k/a, “Man Man,” 23
Minneapolis, Minn.
Charges:
- Conspiracy to possess firearms in furtherance of a drug trafficking crime, 1 count
- Conspiracy to distribute controlled substances, 1 count
- Possession with intent to distribute cocaine base, 1 count
CLARENCE JAMES DICKENS, JR., a/k/a “Claro,” a/k/a, “Sneaky,” 24
Roseville, Minn.
Charges:
- Conspiracy to possess firearms in furtherance of a drug trafficking crime, 1 count
- Conspiracy to distribute controlled substances, 1 count
- Felon in possession of a firearm, 1 count
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
The charges contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Minnesota Man Sentenced to 60 Months for Sexual Assault on U.S. Air Force Base in Okinawa, JapanRead the Press Release
WASHINGTON – A Minnesota man who worked at Kadena Air Base in Okinawa, Japan, was sentenced today to 60 months for sexual assault. Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Andrew M. Luger of the District of Minnesota, Acting Executive Assistant Director Charles Warmuth of the Naval Criminal Investigative Service’s (NCIS) Pacific Operations and Special Agent in Charge Richard T. Thronton of the FBI’s Minneapolis Field Office made the announcement.
Ricky Isiah Sherwood, 19, pleaded guilty on Nov. 14, 2014, to sexual assault. U.S. District Judge Ann D. Montgomery imposed today’s sentence.
In connection with his guilty plea, Sherwood admitted to sexually assaulting a heavily intoxicated minor in a residence on base on Feb. 11, 2014, and to filming parts of the assault using his cellular phone. At the time of the assault, Sherwood was an employee of Kadena Air Base and a dependent of a member of the U.S. Military. The Military Extraterritorial Jurisdiction Act gives federal courts jurisdiction over felonies committed abroad by certain persons employed by or accompanying the U.S. Military.
This case was investigated by NCIS and FBI. This case is being prosecuted by Trial Attorney Ann Marie Ursini of the Criminal Division’s Human Rights and Special Prosecutions Section and Assistant U.S. Attorney Katharine Buzicky of the District of Minnesota.
# # #
Former Bank CEO Pleads Guilty to Obstructing an Examination by the Federal Reserve BoardRead the Press Release
United States Attorney Andrew M. Luger today announced the guilty plea of TIMOTHY PAUL OWENS, 55, for obstructing an examination by the Board of Governors of the Federal Reserve (Federal Reserve Board). In addition to its role in setting national monetary policy and in conjunction with the Federal Deposit Insurance Corporation (FDIC), the Federal Reserve Board is responsible for supervising and regulating banking institutions to ensure the safety and soundness of the nation’s financial system. OWENS pleaded guilty today to one count of obstruction of an examination of a financial institution. He entered the plea before Judge Ann Montgomery in U.S. District Court in Minneapolis, Minn.
“Financial and banking professionals have a responsibility to respond truthfully to regulatory inquiries,” said U.S. Attorney Luger. “This defendant violated his responsibility and broke the law. Federal regulators and prosecutors are working together closely to uncover and prosecute the kind of obstructive behavior exhibited by Mr. Owens.”
According to the defendant’s guilty plea and documents filed in court, OWENS served as CEO and Chairman of Voyager Bank (Voyager) and the President and CEO of the bank’s holding company, Voyager Financial Services Corporation (VFSC). In June 2009 the Federal Reserve Board conducted an examination of VFSC, focusing specifically on loans made to VFSC insiders, including OWENS. The Federal Reserve Board examiners sought to, among other things, determine the quality of VFSC’s internal controls relating to loans to insiders and the credit risk presented by the loans. According to the information known to the examiners at the time, VFSC had issued three loans to OWENS.
According to the defendant’s guilty plea and documents filed in court, after the examination the Federal Reserve Board on July 7, 2009 demanded in writing that VFSC review OWENS’ loans and submit documentation showing that the loans to OWENS had been reviewed by the VFSC board and were consistent with existing bank policies. The Federal Reserve specifically ordered that its letter be presented to the VFSC Board of Directors and discussed at its next meeting. OWENS received the letter personally, but did not disclose it to the VFSC board. Instead, OWENS alone prepared a response to the Federal Reserve Board.
At the time of the examination, OWENS had four loans with VFSC totaling more than $5 million. According to the defendant’s guilty plea and documents filed in court, however, OWENS’ response to the Federal Reserve was false and misleading, because he only identified the three loans that had been disclosed in the June examination, did not disclose a fourth $1,000,000 loan, and wrote the response as though it had been reviewed and approved by the VFSC Board of Directors and signed by its chairman, when in fact it had not. The purpose of the misrepresentations, according to OWENS’ guilty plea today, was to portray inaccurately his financial circumstances and ability to repay the loans by, among other things, exaggerating his wealth and concealing his liabilities and thereby cause the Federal Reserve Board to end its examination of VFSC and OWENS’ substantial indebtedness.
This case is the result of an investigation conducted by the Office of Inspector General for the Board of Governors of the Federal Reserve System and the Consumer Financial Protection Bureau; the Federal Deposit Insurance Corporation, Office of Inspector General; the Federal Housing Finance Agency, Office of Inspector General; and the Federal Bureau of Investigation.
This case is being prosecuted by Assistant U.S. Attorney Robert Lewis.
Defendant Information:
TIMOTHY PAUL OWENS, 55
Wayzata, MN
Convicted:
- Obstructing Examination of a Financial Institution, 1 count
###
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Suspended Pelican Rapids Doctor Pleads Guilty to Stealing Prescription DrugsRead the Press Release
United States Attorney Andrew M. Luger today announced the guilty plea of BLAIR A. NELSON, 43, who obtained Hydrocodone, Oxycodone, and other prescription drugs by writing and filling fraudulent prescriptions. NELSON pleaded guilty to obtaining a controlled substance by fraud today before Judge Susan R. Nelson in United States District Court in St. Paul, Minn.
“Prescription drug diversion is an ongoing threat to both public safety and public health,” said U.S. Attorney Luger. “Working closely with colleagues at the Drug Enforcement Administration and in local law enforcement, we are clamping down on prescription drug fraud and abuse.”
According to the defendant’s guilty plea and documents filed in court, beginning in May 2013, NELSON, who was a doctor practicing medicine in Pelican Rapids, Minn., and Fargo, N.D., began writing prescriptions to various pharmacies in Minnesota for opioids including oxycodone, hydrocodone, and amphetamines. NELSON wrote the prescriptions so that they could be filled in the names of members of his family and friends. However, after issuing the prescriptions, NELSON picked up the drugs for his own use.
According to his guilty plea and documents filed in court, between May 2013 and September 2014, NELSON attempted to obtain from Target, Walgreens, and Wal-Mart, at least 1,730 prescription pills for his own use by writing prescriptions in the names of his family members. He continued to write prescriptions even after the State of Minnesota suspended his medical license on October 8, 2013.
This case is the result of an investigation conducted by the Drug Enforcement Administration.
Assistant U.S. Attorney Thomas Calhoun-Lopez is prosecuting the case.
On Tuesday, August 25, 2015, a conference entitled, “Pain.Pill.Problem.” will be held at the University of Minnesota’s Twin Cities Campus, to bring together experts in the fields of public health and law enforcement to define the scope of the opioid abuse problem and develop solutions to move Minnesota forward together. The one-day conference is co-sponsored by the United States Attorney’s Office for the District of Minnesota, the Minnesota Department of Human Services, U.S. Drug Enforcement Administration, Hazelden Betty Ford Institute for Recovery Advocacy, Mayo Clinic, Hennepin County Sheriff’s Office, University of Minnesota, and others. Please visit www.PainPillProblem.com for more information about the event.
Defendant Information:
BLAIR A. NELSON, 43
Pelican Rapids, Minn.
Convicted:
- Obtaining a controlled substance by fraud, 1 count
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Matthew Peterson Sentenced After Pleading Guilty to Federal Charges for Stealing Prescription OpioidsRead the Press Release
United States Attorney Andrew M. Luger today announced the sentencing of MATTHEW RICHARD PETERSON, 39, who pleaded guilty to federal charges of fraudulently acquiring pain medication while he was employed as a paramedic. PETERSON was indicted on August 11, 2014, and pleaded guilty on November 7, 2014. He was sentenced today before Senior Judge David S. Doty in U.S. District Court in Minneapolis, Minn.
“This defendant stole opioids to feed his own addiction, leaving vulnerable patients without the medicine they needed,” said U.S. Attorney Luger. “The charges in this case reflect our growing concern about the theft and abuse of opioids. I encourage those with an addiction – particularly caregivers and medical professionals – to seek help so they do not end up facing the type of criminal charges faced by Mr. Peterson.”
“Minnesota paramedic Mathew Peterson abused his position of public trust by providing diluted pain medication to those facing critical health emergencies to fuel his own drug addiction,” said Drug Enforcement Administration (DEA) Assistant Special Agent in Charge Dan Moren. “Peterson’s reckless behavior not only denied patients relief from pain but also jeopardized their medical condition and potentially exposed them to contaminated medications. This joint investigation between DEA and the Federal Food and Drug Administration, with the assistance of the St. Paul Police Department, has eliminated this diversion of controlled substances and reduced the potential for further public harm.”
“The defendant in this case exhibited a complete disregard for the patients he victimized,” said Special Agent in Charge John J. Redmond of the Food and Drug Administration’s Office of Criminal Investigations, Chicago Field Office. “We will continue our work to ensure that those who tamper with patients’ pain medication for their own purposes are brought to justice. We commend our law enforcement partners for their efforts in this case as well as the U.S. Attorney’s Office for its prosecution of this matter.”
According to his guilty plea and documents filed in court, from August 2013 to November 5, 2013, PETERSON, who was then working as a paramedic for Allina Health, stole morphine and hydromorphone intended for ambulance patients. PETERSON extracted the drugs with a syringe and, in an effort to cover up his crime, replaced the liquid with a saline solution. PETERSON left more than 100 patients at greater risk of infection and pain as a result of his tampering, and only reported himself when co-workers discovered his malfeasance.
According to the defendant’s guilty plea and documents filed in court, on April 4, 2014, after his dismissal from both inpatient and outpatient addiction treatment, PETERSON was discovered hiding under a trailer in a Bloomington fire station where he was attempting to steal and use opioids. When questioned by law enforcement, PETERSON admitted that he accessed the fire station to steal drugs.
This case is the result of an investigation conducted by the U.S. Drug Enforcement Administration, U.S. Food and Drug Administration’s Office of Criminal Investigations, and the St. Paul Police Department.
This case was prosecuted by Assistant U.S. Attorney Richard A. Newberry.
On Tuesday, August 25, 2015, a conference entitled, “Pain.Pill.Problem.” will be held at the University of Minnesota’s Twin Cities Campus, to bring together experts in the fields of public health and law enforcement to define the scope of the opioid abuse problem and develop solutions to move Minnesota forward together. The one-day conference is co-sponsored by the United States Attorney’s Office for the District of Minnesota, the Minnesota Department of Human Services, U.S. Drug Enforcement Administration, Hazelden Betty Ford Institute for Recovery Advocacy, Mayo Clinic, Hennepin County Sheriff’s Office, University of Minnesota, and others. Please contact [email protected] for more information about the event.
Defendant Information:
MATTHEW RICHARD PETERSON, 39
Richfield, Minn.
Convicted:
- Obtaining a controlled substance by fraud, 1 count
Sentenced:
- 3 years of probation, including:
- Regular drug testing
- Prohibited from having a job with access to controlled substances
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Wisconsin Man Indicted for Illegally Possessing A FirearmRead the Press Release
United States Attorney for the District of Minnesota Andrew M. Luger today announced an indictment charging JAMES RYAN FREI, 34, with illegal possession of a firearm. FREI is expected to make an initial appearance on July 16, 2015, before Magistrate Judge Franklin L. Noel in U.S. District Court in Minneapolis, Minn.
According to the indictment and documents filed in both state and federal court, on June 21, 2015, FREI attempted to steal a wireless speaker from a St. Paul Wal-Mart. The defendant was momentarily stopped and questioned by St. Paul Police Officer Michael Tschida as the defendant tried to leave the Wal-Mart. However, FREI pointed a handgun at Officer Tschida’s head before running to a pickup truck outside and recklessly driving away. The defendant led police officers on a high-speed chase, during which he repeatedly pointed a gun at the pursuing squad cars, sped through red lights and drove against traffic on Snelling Avenue. The chase ended when FREI crashed into a parked car and attempted to flee on foot.
According to the indictment and documents filed in both state and federal court, FREI was ineligible to possess firearms in Minnesota because of felony convictions from Oklahoma for robbery with firearms and assault, battery with a dangerous weapon, and escape. FREI also has been convicted in Wisconsin for burglary and escape.
This case is the result of an investigation conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives.
This case is being prosecuted by Assistant United States Attorney Jeffrey S. Paulsen.
Defendant Information:
JAMES RYAN FREI, 34
Tomah, Wis.
Charges:
- Felon in possession of a firearm, 1 count
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
The charges contained in the indictment are merely allegations, and the defendant is presumed innocent unless and until proven guilty.
Former Member of Croatian Defense Council in Bosnia and Herzegovina (HVO) Pleads Guilty to Fraudulently Obtaining Green CardRead the Press Release
United States Attorney Andrew M. Luger and Acting Special Agent in Charge of Homeland Security Investigations St. Paul Division William Lowder today announced the conviction of ZDENKO JAKIŠA, 47, for obtaining a Permanent Resident Card (I-551), commonly referred to as a “Green Card,” by materially false claims and statements. JAKIŠA entered his plea today before Judge Susan Richard Nelson in United States District Court in St. Paul, Minn.
According to the defendant’s guilty plea and documents filed in court, JAKIŠA is a Bosnian citizen and lawful permanent resident of the United States living in Minnesota. On April 17, 2014, JAKIŠA possessed a green card that was unlawfully obtained. In response to questions on his legal permanent resident applications, JAKIŠA knowingly denied that he had been arrested, charged, or imprisoned for breaking the law in Bosnia and Herzegovina.
According to the defendant’s guilty plea and documents filed in court, between July 1990 and October 1997, JAKIŠA was charged with at least seven separate crimes in Bosnia and Herzegovina. On July 13, 1990, JAKIŠA was charged and convicted of Violent Behavior. He was charged with Grand Larceny on April 7, 1991, for allegedly stealing a cash register from a café. JAKIŠA was charged and convicted of Causing General Danger in September 1993 for shooting and killing his neighbor through her bedroom window.
According to JAKIŠA’s guilty plea and documents filed in court, he was arrested, charged and convicted of Theft for stealing commercial scales from an outdoor storage area on October 11, 1994. JAKIŠA was convicted of Infliction of Grievous Bodily Damage in February 1997 for seriously wounding another person who was later discovered bloodied in the street. JAKIŠA was convicted of Disturbing Peace & Public Order for attempting to persuade a woman to leave her home by threatening that he would get a firearm, throwing bricks at her home, and by attempting to break through the front door. Less than a week later, JAKIŠA was charged with fighting and stealing a gold necklace from the victim’s neck.
This case is the result of an investigation conducted by Homeland Security Investigations.
Assistant U.S. Attorney from the District of Minnesota Nathan P. Petterson and Trial Attorney Ann Marie Ursini of the Human Rights and Special Prosecutions Section of the Criminal Division, U.S. Department of Justice are prosecuting the case.
Defendant Information:
ZDENKO JAKIŠA, 47
Forest Lake, Minn.
Convicted:
- Possession of unlawfully obtained documents, 1 count
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Dennis Helmer Sentenced to More Than 12 Years in Prison for Orchestrating $1.3 Million Coin Fraud SchemeRead the Press Release
United States Attorney Andrew M. Luger today announced the sentence of DENNIS CHARLES HELMER, a/k/a “Jeff Jones,” a/k/a, “Mr. Diamond,” a/k/a, “Dennis Dimon,” 54, to 150 months in prison for devising an elaborate coin fraud scheme and defrauding dozens of elderly victims of more than $1.3 million. HELMER was indicted on August 5, 2014, and pleaded guilty on September 25, 2014. He was sentenced today before Senior Judge David S. Doty.
According to the defendant’s guilty plea and documents filed in court, HELMER operated Wholesale Assets Worldwide, LLC (WAW) and Best Price International, LLC (BPI), which engaged in appraising, buying, selling, and trading of coins and precious metals. From November 2009 through January 2014, through WAW and BPI, HELMER contacted dozens of victims, many of whom were in their 80s and 90s. He visited potential victims in their homes and persuaded them to entrust to him money, coins, and precious metals, based on false promises. HELMER falsely told victims that his businesses had more than 75 employees and $500 million in annual revenue, and also provided a falsely obtained “Dun & Bradstreet Credibility Review” of his business.
According to the defendant’s guilty plea and documents filed in court, WAW and BPI received over $1.3 million in coins, precious metals, and cash from victims. Instead of fulfilling their orders, HELMER sold many of the coins and used customers’ money and proceeds from those sales to fulfill other orders, make payments to other customers, pay his own personal expenses, and attempt to fund start-up costs for another purported company, Smoke Shack, LLC.
According to the defendant’s guilty plea and documents filed in court, HELMER targeted elderly victims because they were particularly vulnerable. HELMER took note of anything that would make it easier to steal from them. For example, HELMER targeted a 79-year-old stroke victim, an 86-year-old victim who fell asleep during an in-person meeting with HELMER, a 99-year-old victim suffering from dementia, a victim in hospice care, and a legally blind octogenarian.
According to the defendant’s guilty plea and documents filed in court, HELMER used various aliases, including “Jeff Jones,” in an attempt to hide his three prior criminal convictions for similar conduct in both Dakota and Hennepin Counties. In November 2013, when HELMER learned that WAW was under investigation, he moved his coin fraud operation to Florida where he continued to operate his scheme under the newly formed BPI under the aliases, “Mr. Diamond” and “Dennis Dimon.”
This case is the result of an investigation conducted by the United States Postal Inspection Service and the Minnesota Department of Commerce.
Assistant U.S. Attorney Kimberly A. Svendsen prosecuted this case.
Defendant Information:
DENNIS CHARLES HELMER, 54
Farmington, Minn.
Convicted:
- Mail Fraud, 1 count
Sentenced:
- 150 months in federal prison
- 3 years supervised release
- $1,329,873.25 restitution
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Tory Hughes Sentenced to 71 Months in Prison for Defrauding Elderly Victims in Coin Fraud SchemeRead the Press Release
United States Attorney Andrew M. Luger today announced the sentence of TORY EVAN HUGHES, 45, to 71 months in federal prison for stealing more than $700,000 through a gold and coin investment scheme. HUGHES was indicted on August 6, 2014, and pleaded guilty on October 8, 2014. He was sentenced today before United States District Court Judge Richard Kyle.
According to the defendant’s guilty plea and documents filed in court, from August 2009 through September 2010, the defendant owned and operated Reputable Rare Coins, LLC (“RRC”), located in Roseville, Minnesota. HUGHES claimed to buy, sell and trade gold, silver and other coins. To generate business, the defendant made unsolicited phone calls primarily to elderly individuals in an effort to encourage them to purchase or exchange coins at RRC.
According to the defendant’s guilty plea and documents filed in court, HUGHES received more than $600,000 in coins and cash from at least nine victims in Minnesota and elsewhere, including one victim who mailed $50,000 to RRC. However, instead of reimbursing the victims—some of whom had sent him their life’s savings—HUGHES told his customers that he was having ongoing issues with coin suppliers and instead used the victim’s money to fuel his gambling addiction and pay for personal expenses.
According to the defendant’s guilty plea and documents filed in court, in May 2013 HUGHES incorporated a new business, U.S. Collectables, in Gilbert, Arizona. Between May 2013 and May 2014, HUGHES used U.S. Collectables to defraud more than $100,000 from at least six victims who expected to receive money or coins from HUGHES.
“These victims have suffered immeasurably as a result of HUGHES’ callous behavior,” said Assistant U.S. Attorney Karen B. Schommer. “HUGHES lied to them, gave them false hope and gambled away their life’s savings. I hope that the victims find some measure of comfort in today’s sentence.”
This case is the result of an investigation conducted by the United States Postal Inspection Service and the Roseville Police Department.
This case was prosecuted by Assistant U.S. Attorney Karen B. Schommer.
Defendant Information:
TORY EVAN HUGHES, 45
Minneapolis, Minn.
Convicted:
- Mail fraud, 1 count
Sentenced
- 71 months in prison
- $753,203.83 in restitution
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Inver Grove Heights Man Sentenced to 37 Months in Prison for Conspiring to Traffic Counterfeit JerseysRead the Press Release
United States Attorney Andrew M. Luger today announced the sentence of BRIAN TODD GORE a/k/a “Sammy Walker,” 46, to 37 months in federal prison for conspiring to traffic counterfeit Major League Baseball, National Basketball Association, National Football League, National Hockey League and National Collegiate Athletic Association jerseys. GORE was indicted on July 9, 2014, and pleaded guilty on December 9, 2014. He was sentenced today before United States District Court Judge Patrick Schiltz.
According to the defendant’s guilty plea and documents filed in court, from November 2009 through September 2012, GORE ordered counterfeit jerseys from suppliers in China and sold them to various buyers in Minnesota and elsewhere. One such buyer was a co-conspirator, R.M., the owner of AME Sports in Roseville, Minnesota. According to R.M., Gore was R.M.’s primary supplier of counterfeit jerseys, which R.M. sold at his store.
According to the defendant’s guilty plea and documents filed in court, in February 2010, GORE and others from Minnesota traveled to Miami, Fla., to sell fake NFL jerseys at Super Bowl XLIV. They were encountered as part of a law enforcement operation in which GORE and his co-conspirators tried to sell the counterfeit apparel to undercover officers. At the time, officers seized 383 jerseys from GORE, as well as international shipping receipts showing packages sent from China.
GORE was caught again two years later in Minnesota while in possession of more than 2,000 counterfeit jerseys and hats, some of which retailed in authentic form for as much as $300 each. The total potential retail value of the goods GORE counterfeited was at least $320,000.
This case is the result of an investigation conducted by Homeland Security Investigations.
This case was prosecuted by Assistant U.S. Attorney Sarah E. Hudleston.
Defendant Information:
BRIAN TODD GORE, 46
Inver Grove Heights, Minn.
Convicted:
- Conspiracy to traffic in counterfeit goods, 1 count
Sentenced:
- 37 months in prison
- 3 years supervised release
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Sean Meadows Sentenced to 25 Years for Defrauding Investors of More Than $13 MillionRead the Press Release
United States Attorney Andrew M. Luger today announced the sentence of SEAN MEADOWS, 42, to 25 years in federal prison for using his financial planning and asset management firm, Meadows Financial Group (MFG), to operate a long-term Ponzi scheme in which he stole more than $13 million from at least 100 individual victims. MEADOWS was indicted on August 5, 2014, and pleaded guilty on December 11, 2014. He was sentenced today before United States District Court Judge Susan Richard Nelson.
“Sean Meadows systematically destroyed the financial security of more than one hundred working and middle class people, leaving them with no possibility of recovery,” said U.S. Attorney Luger. “Over the past year we have charged more than a dozen individuals for conducting investment fraud schemes that resulted in the loss of tens of millions of dollars from hundreds of victims. Like Meadows, many of these criminals preyed on the most vulnerable victims – working-class retirees seeking to make a little more out of their golden years. It is a priority of my office to put a stop to this kind of malicious financial exploitation. Working together with excellent investigators at the Minnesota Department of Commerce Fraud Bureau, IRS-CID, United States Postal Inspection Service, SEC and FBI, we are focused on catching these types of cases at the earliest stages to prevent the kind of financial catastrophe that Sean Meadows caused to the victims in this case.”
“Sean Meadows pretended to be a trusted investment adviser, but he abused that trust by lying to and stealing from his clients,” said Minnesota Commerce Commissioner Mike Rothman. “Instead of investing his clients’ hard-earned retirement savings, he used their money to bankroll his own extravagant lifestyle. Meadows not only robbed his victims of their lifetime savings. He also robbed them of their peace of mind and their dreams of a secure retirement. The Commerce Department Fraud Bureau put a stop to his crimes and worked closely with federal authorities to bring Meadows to justice.”
"Illegal activity involving the investment industry has brought financial ruin to many Americans” said Special Agent in Charge Shea Jones of the IRS Criminal Investigation St. Paul Field Office. “Today's sentencing of Mr. Meadows reinforces our commitment to identify and prosecute those who prey upon honest, hard-working taxpayers that have taken what has belonged to others for their own personal financial gain.”
According to the defendant’s guilty plea and documents filed in court, MEADOWS operated MFG, through which he sold insurance and investment products to clients in Minnesota, Indiana, Arizona, and elsewhere. From 2007 until April 2014, MEADOWS successfully solicited a total of at least $13 million from more than 100 clients for a purported investment managed by MFG. The defendant falsely told victims that he would use their funds to purchase bonds, real estate, or other legitimate third-party investments.
According to the defendant’s guilty plea and documents filed in court, MEADOWS lured victims into removing funds from their retirement and other savings accounts by promising high rates of returns – up to 10 percent annually – when, in fact, he did not invest their funds and did not have a legitimate means by which to make interest payments. Instead, MEADOWS used funds from new investors to make interest and/or principal repayments to existing investors. For example, as charged in the indictment, on September 26, 2013, MEADOWS made a payment of more than $500,000 to one victim, purportedly paying off a successful investment with MFG. In fact, the payment was actually comprised of newly invested funds from other victims.
According to the defendant’s guilty plea and documents filed in court, MEADOWS used the illicit proceeds of the Ponzi scheme to pay personal expenses, including: making “salary” payments to himself; making payments to his spouse; paying expenses on personal investment properties; paying personal credit card bills; purchasing a vehicle for himself; traveling to Las Vegas; gambling at various casinos and online; and spending more than $135,000 at adult entertainment establishments in Minnesota and Las Vegas.
Among the victims MEADOWS defrauded are senior citizens and the disabled, poor or terminally ill. Victims were left in financial ruin because they lost their financial security, retirement funds, their ability to support their families, and in some cases, their ability to pay for cancer treatments.
According to documents filed in court, as just one example, one 66-year-old victim identified in court papers as “Victim 1,” had approximately $200,000 saved in a MetLife annuity when she met the defendant. MEADOWS convinced her to entrust him with the annuity to invest. In November 2013, Victim 1 was diagnosed with lung cancer and was told she only had 18 months to live. When she asked the defendant to surrender her investment so she could travel, enjoy her remaining time and divide her money amongst her family, Meadows convinced her to instead move most of the money to a high interest bond that was “very liquid.” She wrote a check to MFG for $215,000. An Allianz internal investigator soon called her and asked if she was aware of the surrender penalties she would have to pay. The victim called MEADOWS, who told her to “relax” and avoided her questions by first saying he was recovering from knee surgery and later that he was on vacation in Arizona. Victim 1 asked the defendant for $20,000 to cover her credit card debt, which he claimed he would provide, but the money never arrived. MEADOWS left Victim 1 without the funds to travel, without the funds to seek advanced treatment for cancer and with no money to leave to her family.
This case is the result of an investigation conducted by the Minnesota Department of Commerce, Securities and Exchange Commission, the United States Postal Inspection Service, the Internal Revenue Service – Criminal Investigation, and the FBI.
This case was prosecuted by Assistant U.S. Attorneys Benjamin F. Langner and Melinda A. Williams.
Defendant Information:
SEAN MEADOWS, 42
Eden Prairie, Minn.
Convicted:
- Wire Fraud, 7 counts
- Mail Fraud, 3 counts
- Transaction Involving Fraud Proceeds, 1 count
Sentenced
- 25 years in prison
- 3 years supervised release
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Tennessee Man Charged with Driving to Minnesota to Have Sex with 13-Year-Old GirlRead the Press Release
United States Attorney Andrew M. Luger today announced a criminal complaint charging JEFFREY SCOTT EVANS, 51, with traveling from Tennessee to Bloomington, Minnesota, for the purpose of engaging in illicit sexual conduct with a 13-year-old female. EVANS made an initial appearance yesterday in U.S. District Court in St. Paul, Minn., before Magistrate Judge Jeffrey J. Keyes.
According to the criminal complaint and documents filed in court, on June 12, 2015, EVANS used the screen name “taboolooking” on a social media site called “chathour.com,” to initiate a conversation with another user who EVANS believed to be a 13-year-old female. EVANS indicated that he wanted to text and email with her, and if they liked each other he would travel from Tennessee to Minnesota to meet her.
According to the criminal complaint and documents filed in court, later on June 12, 2015, EVANS made a reservation at a hotel in Bloomington, Minn. On June 14, 2014, EVANS asked over text message “Do y really think y can stay with me 3 r 4 days and not get in trouble I hope u can.” The defendant sent photos of himself and described his car to the potential victim. EVANS also sent text messages depicting the sexual acts he wanted to engage in with the girl and photos of sex toys and clothes that he had bought as “gifts” for her.
According to the criminal complaint and documents filed in court, on June 22, 2015, EVANS was apprehended shortly after he arrived at the Bloomington hotel at which he had planned to engage in illicit sexual relations with the 13-year-old female.
This case is the result of an investigation conducted by Homeland Security Investigations with the assistance of the Bloomington Police Department.
This case is being prosecuted by Assistant United States Attorney Kevin S. Ueland.
Defendant Information:
JEFFREY SCOTT EVANS, 51
Blaine, Tenn.
Charges:
- Traveling with the intent to engage in illicit sexual conduct, 1 count
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
The charges contained in the criminal complaint are merely allegations, and the defendant is presumed innocent unless and until proven guilty.
Fargo Man Convicted by Jury of Armed Bank Robbery and CarjackingRead the Press Release
United States Attorney Andrew M. Luger today announced the conviction of MALCOLM ROY EVANS, 52, for armed bank robbery, carjacking, attempted carjacking, and forcing another to accompany while fleeing from the scene. On January 22, 2015, EVANS was indicted for these offenses and, following a four-day trial, a jury found EVANS guilty on June 18, 2015, of all counts of the indictment.
Assistant U.S. Attorney Thomas Hollenhorst said: “Through the hard work of law enforcement and the full cooperation of the victims of these crimes, a violent criminal was brought to justice. The streets of the Fargo-Moorhead area are much safer as a result.”
As proven at trial, on December 29, 2014, EVANS entered a Wells Fargo bank in Moorhead, Minn., and threatened to shoot the teller with a sawed-off shotgun if she didn’t give him money from the bank’s till. EVANS left the bank with approximately $10,100 and attempted to carjack at gunpoint a woman and her college-age daughter who were driving a Volkswagen minivan, but the two victims ran from the minivan and took the keys with them. The defendant fled on foot for approximately two blocks before he got into a Ford F-150 parked nearby, pointed the sawed-off shotgun at a third victim’s head, and ordered him to “drive to the interstate.” At EVANS’ direction, the victim got out of the truck at the West Acres Mall in Fargo, N.D. EVANS abandoned the truck in a parking lot several blocks away and took a bus from the West Acres Mall to a nearby motel.
As proven at trial, on December 30, 2014, law enforcement arrested EVANS at the motel where they found more than $2,500 in cash, a sawed-off shotgun, shotgun shells, and some of the clothing EVANS was seen wearing in the Wells Fargo bank surveillance video.
This case is the result of an investigation conducted by the Federal Bureau of Investigation, Moorhead Police Department, and the Fargo Police Department.
Assistant U.S. Attorneys Thomas M. Hollenhorst and Bradley M. Endicott are prosecuting the case.Defendant Information:
MALCOLM ROY EVANS, 52
Fargo, N.D.
Convicted:
- Armed Bank Robbery, one count
- Carjacking, one count
- Attempted Carjacking, one count
- Forcing a Person to Accompany the Defendant While Avoiding and Attempting to Avoid Apprehension, one count
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Hugo Company Pays $20,000 for Disturbing Vegetation in Minnesota Valley National Wildlife RefugeRead the Press Release
United States Attorney Andrew M. Luger today announced that LAMETTI & SONS, INC. agreed to pay a $10,000 fine and an additional $10,000 in restitution to the non-profit group Refuge Friends, Inc., to resolve allegations in a criminal petty offense citation charging it with one count of disturbing plants during the summer of 2014 in the Minnesota Valley National Wildlife Refuge in Bloomington, Minn.
According to the citation and documents filed in court, LAMETTI was awarded a contract by the Metropolitan Council Environmental Services Burnsville Interceptor Improvements Project for a multi-year construction project to reline sewer pipes on the Minnesota Valley National Wildlife Refuge in Bloomington. A Special Use Permit with specific limitations was incorporated into the construction plans to protect nearby areas of threatened and special-concern plants within the Refuge, which were delineated with signs that read, “Protected Native plants in this area do not enter or disturb.”
According to the violation notice and other court documents, on July 17, 2014, a concerned citizen reported to local wildlife agencies that a large amount of dead vegetation, which potentially included threatened prairie plants such as tobacco root and the small white lady’s-slipper, had been discovered within the Refuge.
On July 18, 2014, U.S. Fish and Wildlife Service (USFWS) agents and a Metropolitan Council representative investigated the area in which dead vegetation was reported. USFWS agents also noted an additional location of standing water containing dead wildlife directly adjacent to one of the construction sites, which emitted a strong chemical odor. About one week later, a USFWS agent observed that the standing water adjacent to the construction site had dissipated and left approximately 6,229 square feet of dead vegetation.
In a memo dated July 24, 2014, a LAMETTI project manager responded to the Metropolitan Council’s inquiries and stated that up to an estimated 24,000 gallons of heated cure water were released at two separate project construction sites within the Refuge due to a problem with the installation process of the liners on the sewer pipes on two separate dates. The heated cure water release was unauthorized and went unreported prior to the investigation. According to the Special Conditions of the Special Use Permit, the permit holder was required to report all damage to lands within 24 hours of the incident.
“A large portion of the Minnesota Valley National Wildlife Refuge is urban and provides valuable habitat for a wide range of plants and wildlife,” said U.S. Fish and Wildlife Service, Refuge Law Enforcement Officer Scott Pariseau. “Another benefit to our urban refuge is the unique opportunity we provide for the community to enjoy and appreciate wildlife-related recreation close to home. It’s unfortunate that despite all of the planning and permitting to mitigate resource damage from this project, damages to important habitat occurred. We are however pleased to see that the contractor was held responsible for the damage they caused to this public resource.”
The citation issued is the result of an investigation conducted by the U.S. Fish and Wildlife Service.
This case was prosecuted by Assistant U.S. Attorney Benjamin Bejar.
Defendant Information:
LAMETTI & SONS, INC.
Hugo, Minn.
Charges:
- Disturbing plants on National Wildlife Refuge, 1 count
Settlement:
- $10,000 fine
- $10,000 restitution
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Mound Man Pleads Guilty to Tax EvasionRead the Press Release
United States Attorney Andrew M. Luger today announced the guilty plea of JAMES SIGANOS, 50, to one count of tax evasion. SIGANOS was charged on May 26, 2015, by felony information, of evading corporate income taxes. He pleaded guilty yesterday before U.S. District Judge Ann D. Montgomery in U.S. District Court in Minneapolis, Minn. A sentencing date has not yet been determined.
According to his guilty plea and documents filed in court, SIGANOS was the owner of a carpet-cleaning business located in Mound, Minnesota. As owner of the company, the defendant was responsible for filing federal corporate tax returns on behalf of the company. SIGANOS filed a Form 1120S U.S. Income Tax Return for the calendar year 2009, in which he underreported his company’s gross receipts or sales as $246,166.
In 2009, SIGANOS’ company had approximately $591,013 in gross receipts or sales. To avoid paying taxes on the full amount of his company’s revenue, SIGANOS cashed more than 1,400 checks totaling approximately $410,905 at a check cashing facility in Minneapolis. The result was that the defendant underreported his 2009 income by approximately $344,858. SIGANOS filed no corporate income tax returns for the tax years 2010, 2011, and 2012, resulting in an underreporting of approximately $438,991. The total tax loss caused by SIGANOS is approximately $300,000.
“Tax evasion is not a victimless crime,” said Shea Jones, Special Agent in Charge of the St. Paul Field Office IRS Criminal Investigation. “IRS special agents work diligently to identify and bring to prosecution those who evade their taxes.”
SIGANOS faces up to three years in prison.
This case is the result of an investigation conducted by the Internal Revenue Service – Criminal Investigation Division.
This case is being prosecuted by Assistant U.S. Attorney Joseph H. Thompson.
Defendant Information:
JAMES SIGANOS, 50
Mound, Minn.
Convicted:
- Tax Evasion, 1 count
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Zimmerman Man Found Guilty After Trial of Distribution of Child PornographyRead the Press Release
United States Attorney Andrew M. Luger today announced the conviction after a jury trial of LEVI WAYNE BURNS, 40, for distribution of child pornography. BURNS pleaded on guilty on June 5, 2015, to possession of child pornography in the same case. The defendant was charged by indictment on November 20, 2014, with one count of possession and one count of distribution of child pornography. BURNS was convicted in 2005 in Sherburne County, Minn., for criminal sexual conduct in the third degree for engaging in sexual acts with a 15-year-old female child. A sentencing date on the federal conviction has not yet been determined.
According to the defendant’s guilty plea and as proven at trial, in January 2014, BURNS shared electronically several files containing images and videos of child pornography, including a video depicting two female children between the ages of 10 and 14 engaged in sexual acts. BURNS, who lived in the basement of his parents’ home in Sherburne County, operated a large number of computers and related equipment. In fact, BURNS was using so much computer power that he and his parents were using the heat generated by the defendant’s computers to heat their house that winter, which was one of the coldest in recent Minnesota history.
According to the defendant’s guilty plea and as proven at trial, BURNS was operating a specially built computer with several hard drives, at least one of which was dedicated to storing and sharing child pornography over the internet. The defendant also saved thousands of files of child pornography on a separate external hard drive.
This case is the result of an investigation conducted by the Federal Bureau of Investigation, Sherburne County Sheriff’s Office, and the Minneapolis Police Department.
Assistant U.S. Attorneys Katharine T. Buzicky and Sarah E. Hudleston are prosecuting the case.Defendant Information:
LEVI WAYNE BURNS, 40
Zimmerman, Minn.
Convicted:
- Distribution of child pornography, 1 count
- Possession of child pornography, 1 count
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Twin Cities Couple Indicted for Sex Trafficking of Four Teenage GirlsRead the Press Release
United States Attorney Andrew M. Luger today announced the indictment of PHILLIP DWAYNE LLOYD a/k/a “PC,” 43, and RAQUEL MONE BELCHER, 29, for trafficking three teenage girls for the purpose of commercial sex. LLOYD is also charged with producing child pornography of one of the trafficked victims. BELCHER is additionally charged with possession of child pornography. The defendants, who were indicted in May, were fugitives until yesterday when they were arrested by United States Marshals in the Chicago-area. The defendants made initial appearances yesterday in United States District Court in the Northern District of Illinois.
According to the indictment and documents filed in court, between January 14, 2015, and January 27, 2015, LLOYD, who is a registered sex offender, and BELCHER, trafficked three girls in and around the Twin Cities for the purpose of commercial sex. All three victims were under the age of eighteen. During this time, LLOYD also made pornographic videos of one of the minor victims engaging in sexually explicit conduct.
According to the indictment and documents filed in court, between August 2, 2010 and August 22, 2010, LLOYD trafficked a fourth juvenile victim for the purpose of commercial sex.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
If you know of any child who may have been a victim of exploitation, please call the National Center for Missing or Exploited Children (NCMEC) at 1-800-THE-LOST (1-800-843-5678) or visit NCMEC’s web site at www.missingkids.com.
This case is the result of an investigation conducted by Homeland Security Investigations, the Minneapolis Police Department, Anoka County Sheriff’s Office, the Federal Bureau of Investigation, and the United States Marshals.
This case is being prosecuted by Assistant U.S. Attorney Laura M. Provinzino.
Defendant Information:
PHILLIP DWAYNE LLOYD a/k/a “PC,” 43
Coon Rapids, Minn.
Charges:
- Sex trafficking of a minor or by force, fraud, or coercion, 4 counts
- Production of child pornography, 1 count
RAQUEL MONE BELCHER, 29
Minneapolis, Minn.
Charges:
- Sex trafficking of a minor or by force, fraud, or coercion, 3 counts
- Possession of child pornography, 1 count
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
The charges are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Career Criminal Sentenced to 262 Months for Drug Trafficking and Possession of A FirearmRead the Press Release
United States Attorney Andrew M. Luger announced on Wednesday the sentence of ALBERT TERRELL ELLIS, 38, a/k/a, “Alvin Ellis,” to 262 months in prison for possession of a firearm, possession with intent to distribute heroin and use of a firearm during and in relation to a drug trafficking crime. The Defendant was sentenced on June 4, 2015 before U.S. District Court Judge Ann Montgomery.
As proven at trial and according to documents filed in court, on October 10, 2012, ELLIS and his girlfriend, A.G., got into a fight with A.G.’s roommate, J.C. The Duluth Police Department responded to a 911 call from J.C.’s mother informing the police department that her daughter felt she was in danger. During a subsequent search of the apartment and ELLIS’s car, police dogs discovered heroin and crack. ELLIS had hidden the drugs, packaged for distribution, in the gas cap of his car. He also hid a loaded Smith and Wesson .45 Caliber pistol in the engine block of his vehicle. ELLIS was later arrested with more than $6,000 in illegal drug proceeds.
According to documents filed in court, ELLIS is a career criminal with a violent history. He was first convicted of battery when he was 14-years-old. His criminal history includes two convictions for drug trafficking, and convictions for attempted murder and attempted armed robbery, each of which is a felony. When ELLIS was let out of prison for attempted armed robbery in 2009, he was arrested four times between then and 2012. Three times for battery and once for theft.
“This defendant is an armed career criminal and a career offender with a violent criminal history,” said Assistant United States Attorney Tom Calhoun-Lopez. “This sentence will ensure that society is protected from his further crimes.”
This case was prosecuted by Assistant United States Attorney Tom Calhoun-Lopez.
Defendant information:
ALBERT TERRELL ELLIS, 38
Duluth, Minn.
Convicted:
- Possession of a firearm as an armed career criminal, 1 count
- Possession with intent to distribute heroin, 1 count
- Use of a firearm during and in relation to a drug trafficking crime, 1 count
Sentenced:
- 262 months in prison
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Waseca Accountant Sentenced to More Than Four Years in Prison and Ordered to Pay $1.6 Million to VictimsRead the Press Release
United States Attorney Andrew M. Luger today announced the sentencing of ROGER HERMAN GOETZ, JR., 59, to 54 months in federal prison for defrauding his clients of nearly $1.6 million. GOETZ, JR., who pleaded guilty on January 20, 2015, to two counts of wire fraud, was sentenced today in U.S. District Court in St. Paul, Minn., by U.S. District Judge Richard H. Kyle.
“This defendant used his position as a certified public accountant to exploit his most vulnerable clients,” said U.S. Attorney Luger. “Minnesotans trust financial professionals to protect us from unexpected loss. Roger Goetz, Jr., abused that trust for his own financial gain.”
According to his guilty plea and documents filed in court, GOETZ has been a certified public accountant since 1980. He was previously licensed in the State of Minnesota. From at least December 2009 until at least February 2013, the defendant repeatedly lied to his tax preparation clients to steal their money.
According to his guilty plea and documents filed in court, in 2009, GOETZ was hired to file estate taxes for R.W.’s deceased parents. R.W. wired $115,000 to the defendant to pay the estimated state tax. GOETZ instead stole the money, a fact that R.W. didn’t discover for two years. When confronted by R.W., GOETZ provided him with fraudulent documents in an attempt to cover up the fact that GOETZ failed to pay the taxes on behalf of R.W. The victim ultimately was forced to use his daughter’s college fund to pay the outstanding taxes and penalties.
According to his guilty plea and documents filed in court, in January 2012, about one month after R.W. confronted GOETZ about the unpaid taxes, GOETZ stole another $170,000 from a different tax preparation client. T.B. hired GOETZ to prepare estate tax returns for his deceased parents and GOETZ again stole the funds. When T.B. confronted GOETZ about one-year later, GOETZ gave T.B. a check to cover the penalties, but the check bounced.
According to his guilty plea and documents filed in court, GOETZ repeatedly used stolen money from his clients for his own business, Core Wafer Systems (CWS). In addition to the money from R.W. and T.B., Goetz lied to at least nine investors about purported investments in CWS and in an assisted living facility in New Ulm, Minn. Instead of using their purported investments for CWS or the assisted living facility, GOETZ transferred money to accounts not connected either purported investment and used it for unrelated purposes, such as paying overdue bills.
This case is the result of an investigation conducted by the Federal Bureau of Investigation and the Waseca Police Department.
Assistant U.S. Attorney Kimberly A. Svendsen prosecuted the case.
Defendant Information:
ROGER HERMAN GOETZ, JR., 59
Waseca, Minn.Convicted:
- Wire Fraud, 2 counts
Sentenced:
- 54 months in prison
- Three years supervised release
- $1,599,857.77 in restitution
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Forty-One Defendants Charged with Conspiracy to Traffic Heroin and Prescription Opioids to Upper Midwest Indian ReservationsRead the Press Release
United States Attorney Andrew M. Luger today announced the indictment of forty-one members of a multi-state heroin trafficking conspiracy. The 41 defendants named in the indictment were charged with Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone. Several defendants were charged with additional crimes related to the drug trafficking scheme, including firearms offenses. The defendants are making initial appearances this week before Magistrate Judge Tony Leung in U.S. District Court in St. Paul, Minn.
"The indictment of the Beasley drug trafficking organization is emblematic of our commitment to combatting heroin trafficking in Minnesota," said U.S. Attorney Andrew Luger. "These defendants, led by Omar Beasley, represented the most significant source of heroin in Indian Country. Through close collaboration with our federal, local, and Tribal law enforcement partners, we have shut down this major pipeline that was spreading heroin across the Red Lake and White Earth Indian Reservations and the surrounding communities."
"The Omar Beasley heroin and prescription drug trafficking organization cared nothing about the collateral damage it inflicted upon neighborhoods, families, and especially young children on tribal lands in Minnesota and elsewhere in the Midwest," stated DEA Minneapolis-St Paul Assistant Special Agent in Charge Dan Moren. "Beasley and the 40 other members of his organization believed that federal, state, local and tribal law enforcement agencies throughout the region were not speaking with one another and connecting the dots…they were wrong."
Red Lake Police Department’s Public Safety Director William Brunelle said: "We have sent a clear message to drug trafficking organizations that drug dealing will not be tolerated on or near Tribal reservations. I have a great appreciation and the utmost respect for all law enforcement agencies participating in this drug investigation. This is a perfect example of how multiple law enforcement agencies can successfully collaborate against one common enemy that is devastating both Indian and Non-Indian communities alike. Drug dealers have no borders to follow and law enforcement has proven that they will cross all borders to get the job done as well."
White Earth Police Department’s Public Safety Director Randy Goodwin said: "We are proud of the hard work and dedication that resulted in the arrests of a criminal organization that prospered from poisoning many people on the White Earth Nation. Many lives, families and communities have been damaged or destroyed from this poison. Now, the hard work of healing and wellness begins!"
"I am very proud of the fantastic job that ATF, DEA, BCA, the Paul Bunyan Task Force and other law enforcement agencies did working collaboratively with the common goal of dismantling the Beasley drug trafficking organization," stated ATF St. Paul Field Division Special Agent in Charge James C. Modzelewski. "I am confident that this investigation has significantly impacted the flow of illegal narcotics and violations of federal firearms laws in a multi-state area."
Special Agent in Charge of the Federal Bureau of Investigation Minneapolis Division Richard Thornton said: "The FBI is proud to stand shoulder to shoulder with its law enforcement partners when it comes to fighting the scourge of drugs and drug dealing on reservations. Those who would engage in drug dealing should note that law enforcement will always be seeking to uncover their activities."
Minnesota Bureau of Criminal Apprehension Superintendent Wade Setter said: "This case came together because of the criminal justice partnerships that are critical when investigating multi- jurisdictional crimes of this nature. This effort will continue as long as criminals endeavor to funnel this deadly drug to the people of our state."
According to the indictment and documents filed in court, from at least April 2014 until April 2015, OMAR SHARIF BEASLEY, 37, led a drug trafficking conspiracy in which he recruited drug sources, managers, distributors, facilitators, couriers and drivers to bring heroin and other drugs to the Red Lake and White Earth Indian Reservations in Minnesota and Native American communities in North Dakota.
According to the indictment and documents filed in court, WILLIAM DAVID ALONZO, 23, CALVIN BEASLEY, 58, WILLIE BELLAMY, JR., 67, ERNESTINE DUKES, 45, MICHAEL LENIOR DUKES, 47, BRENDA ANN FAGAN, 67, VELVET ILENE JOHNSON, 44, YVETTE KOUAYARA, 53, BURNEY ABDULAH PEOPLES, 27, DOERON EARL RAYFORD, 41, LAMARCUS ANTONIO BROCK, 37, STEPHEN MARTIN HOLLIS, 37, MICHAEL TRAVELL COLLINS, 38, YALONZO RAMON HULL, 50, STACEY RAE DUCHAINE, 24, SARAH ELIZABETH THOMPSON, 30, and JODI LYNN KJOLBERG, 44, served as the out-of-state branches of the drug trafficking organization. These defendants acted as facilitators, suppliers, transporters, or distributors from Detroit, Mich., Chicago, Ill., Minneapolis, Minn., Milwaukee, Wis., and North Dakota.
According to the indictment and documents filed in court, TRAVIS JAMES BAKER, 25, ROSE LYNN BARRETT, 27, SONNIE MARIE BARRETT, 26, TIMOTHY JOSEPH BEAULIEU, JR., 33, MICHAEL JOSEPH DOMINGUEZ, 29, APRIL MARIE GRAVES, 31, JARVIS ALLEN KING, 23, CHRISTOPHER ERVING PEOPLES, 33, RAVONNA RAYE PEOPLES, 44, SHERRLENE ROSE ROBERTS, 67, DALE ANDREW SIGANA, 32, and ROBYN JOANNE WIPF, 33, served as the Red Lake branch of the drug trafficking organization. These defendants distributed drugs on the Red Lake Indian Reservation on behalf of the conspiracy. They also maintained drug stash houses on the reservation and gave the proceeds of drug sales to co-conspirators.
Several co-conspirators, identified in the indictment as WILLIAM JAMES FASTHORSE, 25, DURIAL JOHN JACKSON, 29, JUSTIN LEE JOHNSON, 24, GENE MICHAEL KEEZER, 37, NAKOYA HARRIS KEEZER, 37, RODNEY LEE KEEZER, 36, JENNIFER LYNN OPPEGARD, 27, JESSICA RAE OPPEGARD, 36, LEE ALLEN OPPEGARD, 39, LUCAS JOHN PETERSON, 26, and MAISIE ANN SARGENT, 25, served as the White Earth branch of the drug trafficking organization. These defendants facilitated, managed, transported and distributed drugs on the White Earth Indian Reservation on behalf of the conspiracy. They also received and transferred funds, as well as maintained drug stash houses on the White Earth Indian Reservation.
According to the indictment and documents filed in court, between April 2014 and April 2015, the defendants conspired with each other to distribute multiple kilograms of heroin, as well as methamphetamine, oxycodone, hydromorphone, hydrocodone, and methadone to the communities in and surrounding the Red Lake and White Earth Indian Reservations. As part of the drug trafficking conspiracy, BEASLEY traveled from Minneapolis, Minn. to Red Lake, Minn., White Earth, Minn., and to North Dakota to provide drugs to co-conspirators for distribution on the Indian Reservations. BEASLEY would then return to major cities in Minnesota, Wisconsin, Illinois, and Michigan to replenish the supply of drugs to bring into Indian Country.
Count One of the indictment alleges multiple overt acts committed by 13 of the defendants in furtherance of the conspiracy. The acts include:
* On October 3, 2014, OMAR BEASLEY, SONNIE BARRETT, and MICHAEL DUKES possessed with intent to distribute approximately 1300 grams of heroin.
* On November 6, 2014, OMAR BEASLEY, CALVIN BEASLEY, BRENDA FAGAN, YALONZO HULL, and YVETTE KOUAYARA possessed with intent to distribute hydrocodone, hydromorphone, and oxycodone.
* On December 2, 2014, OMAR BEASLEY, JODI KJOLBERG, and ROBYN WIPF possessed with intent to distribute approximately 48 grams of heroin.
* On December 9 and 10, 2014, LEE OPPEGARD distributed approximately 7 grams of heroin.
* On December 14, 2014, OMAR BEASLEY distributed approximately 13 grams of heroin.
* On December 16, 2014, OMAR BEASLEY distributed approximately 15 grams of methamphetamine.
* On March 10, 2015, WILLIAM ALONZO and TIMOTHY BEAULIEU, JR., possessed with intent to distribute approximately 200 grams of heroin as well as hydrocodone, methadone, and oxycodone.
* On April 14, 2015, OMAR BEASLEY possessed with intent to distribute approximately 300 grams of heroin.
* On April 15, 2015, STEPHEN HOLLIS possessed with intent to distribute approximately 200 grams of heroin.
This case is the result of a cooperative investigation conducted by the Red Lake Police Department, the White Earth Police Department, the Paul Bunyan Drug Task Force, the FBI Safe Trails Task Force, the West Central Minnesota Drug and Violent Crimes Task Force, the Drug Enforcement Administration, Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Federal Bureau of Investigation, and the Minnesota Bureau of Criminal Apprehension, assisted by the following law enforcement agencies and task forces, Becker County Sheriff’s Office, Beltrami County Sheriff’s Office, Bemidji Police Department, Bloomington Police Department, Bureau of Indian Affairs, Clearwater County Sheriff’s Office, Customs and Border Protection, Detroit Lakes Police Department, Frazee Police Department, Hubbard County Sheriff’s Office, Mahnomen County Sheriff’s Office, Minnesota Department of Correction, Minnesota State Highway Patrol, Lakes to River Drug Task Force, North Dakota Bureau of Criminal Investigation, Pine to Prairie Drug Task Force, and Wisconsin Department of Criminal Investigation.
This case is being prosecuted by Assistant U.S. Attorneys Deidre Y. Aanstad and Melinda A. Williams.
Defendant Information:
OMAR SHARIF BEASLEY, 37
Anoka County Jail
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
• Possession with Intent to Distribute Heroin, 3 counts
• Distribution of Heroin, 1 count
• Distribution of Methamphetamine, 1 count
WILLIAM DAVID ALONZO, 23
Detroit, Mich.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
• Possession with Intent to Distribute Heroin, 1 count
• Possession with Intent to Distribute Hydrocodone, Methadone, and Oxycodone 1 count
• Possession of a Firearm During and in Relation to a Drug Trafficking Crime, 1 count
TRAVIS JAMES BAKER, 25
Bemidji, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
• False Statements During the Purchase of a Firearm, 1 count
ROSE LYNN BARRETT, 27
Red Lake, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
SONNIE MARIE BARRETT, 26
Red Lake, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
• Possession with Intent to Distribute Heroin, 1 count
CALVIN BEASLEY, 58
Detroit, Mich.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
TIMOTHY JOSEPH BEAULIEU, JR., 33
Red Lake, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
• Possession with Intent to Distribute Heroin, 1 count
• Possession with Intent to Distribute Hydrocodone, Methadone, and Oxycodone 1 count
• Possession of a Firearm During and in Relation to a Drug Trafficking Crime, 1 count
WILLIE BELLAMY, JR., 67
Detroit, Mich.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
LAMARCUS ANTONIO BROCK, 37
Chicago, Ill.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
MICHAEL TRAVELL COLLINS, 38
Unknown
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
MICHAEL JOSEPH DOMINGUEZ, 29
Red Lake, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
STACEY RAE DUCHAINE, 24
Unknown
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
ERNESTINE DUKES, 45
Detroit, Mich.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
MICHAEL LENIOR DUKES, 47
Detroit, Mich.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
• Possession with Intent to Distribute Heroin, 1 count
BRENDA ANN FAGAN, 67
Detroit, Mich.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
WILLIAM JAMES FASTHORSE, 25
White Earth, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
APRIL MARIE GRAVES, 31
Red Lake, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
STEPHEN MARTIN HOLLIS, 37
Brooklyn Park, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
• Possession with Intent to Distribute Heroin, 1 count
YALONZO RAMON HULL, 50
Milwaukee, Wis.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
DURIAL JOHN JACKSON, 29
Unknown
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
JUSTIN LEE JOHNSON, 24
Mahnomen, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
VELVET ILENE JOHNSON, 44
Farmington Hills, Mich.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
GENE MICHAEL KEEZER, 37
Waubun, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
NAKOYA HARRIS KEEZER, 37
Ogema, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
RODNEY LEE KEEZER, 36
Frazee, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
JARVIS ALLEN KING, 23
Red Lake, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
JODI LYNN KJOLBERG, 44
Duluth, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
• Possession with Intent to Distribute Heroin, 1 count
YVETTE KOUAYARA, 53
Detroit, Mich.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
JENNIFER LYNN OPPEGARD, 27
Naytahwaush, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
JESSICA RAE OPPEGARD, 36
Naytahwaush, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
LEE ALLEN OPPEGARD, 39
Mahnomen, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
• Distribution of Heroin, 1 count
BURNEY ABDULAH PEOPLES, 27
Clinton Township, Mich.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
CHRISTOPHER ERVING PEOPLES, 33
St. Paul, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
RAVONNA RAYE PEOPLES, 44
Minneapolis, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
LUCAS JOHN PETERSON, 26
White Earth, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
DOERON EARL RAYFORD, 41
Chicago, Ill.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
SHERRLENE ROSE ROBERTS, 67
Red Lake, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
MAISIE ANN SARGENT, 25
Mahnomen, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
DALE ANDREW SIGANA, 32
Red Lake, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
SARAH ELIZABETH THOMPSON, 30
Unknown
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
ROBYN JOANNE WIPF, 33
Red Lake, Minn.
Charges:
• Conspiracy to Distribute Heroin, Methamphetamine, Oxycodone, Hydromorphone, Hydrocodone, and Methadone, 1 count
• Possession with Intent to Distribute Heroin, 1 count
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
The charges contained in the indictment are merely allegations, and the defendants are presumed innocent unless and until proven guilty.
Stearns County Man Pleads Guilty to Sending Threatening CommunicationRead the Press Release
United States Attorney Andrew M. Luger today announced the guilty plea of ROBERT JAMES SCHUELLER, 29, who devised a plot to harm his former paramour’s fiancé. SCHUELLER was charged by Information on May 26, 2015, and pleaded guilty yesterday before U.S. District Judge Richard H. Kyle in United States District Court in St. Paul, Minn.
Assistant U.S. Attorney Julie Allyn said: "The defendant spent months trying to seriously harm an unsuspecting victim simply because that man was romantic competition in the defendant’s thwarted love affair. The Government is thankful that the defendant finally accepted responsibility for his bizarre scheme and pled guilty."
According to the defendant’s guilty plea and documents filed in court, SCHUELLER, then vice- president of Nomad Pipeline (Nomad) and married to then president M.S., had an extra-marital affair with an employee of Nomad’s sister company. Approximately three months after R.T. ended the relationship with SCHUELLER, SCHUELLER learned that R.T. was in a relationship with C.A. Therefore, SCHUELLER began attempting to win back R.T.’s affections. When the defendant was unable to win back R.T., he began pursuing various schemes to get C.A. out of the picture and away from R.T.
According to the defendant’s guilty plea and documents filed in court, on February 6, 2014, SCHUELLER called W.E., another Nomad employee, and asked if W.E. stayed in contact with any of his prison contacts because SCHUELLER had a guy that needed to "go away." Over the course of several months, SCHUELLER and W.E. communicated back and forth concerning the defendant’s desire to find someone willing to harm C.A. Once W.E. provided SCHUELLER a specific name as a possible person who could injure C.A., SCHUELLER sent W.E. a package containing $10,000 in cash and a business card, on which C.A.’s name was written. On May 2, 2014, W.E. informed SCHUELLER that he was unable to find someone to carry out the plot to injure C.A. and then returned the $10,000 to SCHUELLER. After this conversation, SCHUELLER texted W.E. and instructed him to burn the business card.
According to the defendant’s guilty plea and documents filed in court, SCHUELLER admitted to attempting to contact several other Nomad employees seeking their assistance in causing bodily injury to C.A. SCHUELLER further admitted to plotting various seduction schemes in an attempt to break-up C.A. and R.T. For example, in January 2014, SCHUELLER paid his sister- in-law $500 to seduce C.A.; and in May 2014, SCHUELLER posted a Craigslist ad titled "Girls– 1 time $5,000 cash offer" that sought a "pretty girl" to "break up a couple by any means necessary" and offered payment for such services.
This case is the result of an investigation conducted by the Federal Bureau of Investigation and the Stearns County Sheriff’s Office.
This case is being prosecuted by Assistant United States Attorneys Julie E. Allyn and Steven L. Schleicher in the U.S. Attorney’s Office newly formed Special Prosecutions Section.
Defendant Information:
ROBERT JAMES SCHUELLER, 29
Farming Township, Minn.
Convicted:
• Threats Transmitted by Interstate Communication, 1 count
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
St. Anthony Man Sentenced to 10 Years in Prison for Defrauding More Than $19 Million from InvestorsRead the Press Release
United States Attorney Andrew M. Luger announced the sentencing of TYRONE HERMAN, 56, to 10 years in federal prison for defrauding investors of more than $19 million. HERMAN, who pleaded guilty on October 20, 2014, to one count of wire fraud, was sentenced on May 26, 2015, by Judge Joan N. Ericksen in U.S. District Court in Minneapolis, Minn.
"Investment fraud wreaks havoc on real people whose lives and futures are devastated by unscrupulous criminals like Tyrone Herman," said U.S. Attorney Luger. "Working closely with our colleagues from the Minnesota Department of Commerce and the Federal Bureau of Investigation, we are protecting more people than ever before, making it clear to those who would engage in investment fraud that there are significant penalties for such crimes."
Minnesota Department of Commerce Commissioner Mike Rothman said: "We will continue to fight investment fraud and criminal Ponzi schemes. This case highlights the important role of the Commerce Fraud Bureau in protecting Minnesotans against financial crimes. After a concerned citizen gave a tip to our securities investigators, agents from our Fraud Bureau and the FBI collaborated to investigate and stop this fraud scheme that victimized dozens of individuals, many of them seniors."
According to his guilty plea and documents filed in court, HERMAN, from 1998 through December 2013, operated Executive Marketing Group (EMG) and Ty Herman & Associates, which he claimed had business relationships with manufacturers and wholesalers from whom he could purchase small appliances and other inventory at below-retail market rates. HERMAN told the victims that he could re-sell the inventory in which they invested for a profit of 35 percent, and that victims would receive their money back, with a 30 percent rate of return, within 90 days of the sale of inventory.
According to his guilty plea and documents filed in court, HERMAN created false invoices to demonstrate to victims that had sold the inventory. When they demanded return of their investments, HERMAN provided fake bank statements, purporting to show that, while he had the money in his bank account, the Internal Revenue Service had frozen the account so that he could not access the victims’ money. HERMAN repaid some investors with Ponzi-type payments, not from the sale of inventory.
According to HERMAN’S guilty plea and documents filed in court, he stole more than $19 million from 51 separate victims.
This case is the result of an investigation conducted by the Minnesota Department of Commerce Fraud Bureau and the Federal Bureau of Investigation.
Assistant U.S. Attorney Karen Schommer prosecuted the case.
Defendant Information:
TYRONE R. HERMAN, 56
St. Anthony, Minn.
Charges:
• Wire Fraud, 1 count
Sentenced:
• 120 months in prison
• Three years supervised release
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Minnesota Business Executive Sentenced to 5 Years in Prison on Charges of Conspiracy, Tax Evasion, and Failure to File Tax ReturnsRead the Press Release
United States Attorney Andrew M. Luger today announced the sentencing of MICHAEL ANDREW SCHLEGEL, 56, to 60 months in prison for conspiracy to defraud the United States, tax evasion, and failure to file tax returns. SCHLEGEL, who was convicted on March 13, 2014 following a seven-day trial, was sentenced on May 19, 2015 before Judge Patrick J. Schiltz in United States District Court in Minneapolis, Minn.
According to the evidence presented at trial and documents filed in court, from 2002 to 2009, SCHLEGEL controlled NatureRich, Inc., a multi-level marketing company that sold natural and health-related products. Like similar companies, NatureRich paid commissions to salespeople based on direct sales and on the sales of downstream salespeople. At various times between 2002 and 2009, SCHLEGEL and co-defendant Bradley Mark Collin received wages and commission payments from NatureRich that totaled more than $400,000. SCHLEGEL also caused NatureRich to pay his commissions to a nominee trust called the "Andrew James Living Trust," from which he then paid his family’s expenses. During that time, SCHLEGEL also operated a painting business, receiving more than $400,000 in income from painting contracts.
According to the evidence presented at trial and documents filed in court, in 2004, the defendants, through the use of nominee entities, began engaging the "warehouse" banking services of Olympic Business Systems and Century Business Concepts. Warehouse banking refers to the use of one or more bank accounts in which the funds of multiple clients are deposited and transacted, thereby concealing the true source of the funds and the individual truly responsible for the transactions.
According to the evidence presented at trial and documents filed in court, the defendants also filed misleading federal corporate tax returns in the name of NatureRich in an effort to conceal the true extent of their personal interest in and the income derived from NatureRich. In all, the defendants attempted to conceal at least $3 million in gross income from the IRS, thereby avoiding income taxes on that amount and also avoiding having those funds seized for payment of their previous tax debts.
According to the evidence presented at trial and documents filed in court, from 2002 through 2010, SCHLEGEL, and his co-defendant Bradley Mark Collin, conspired with each other and others to defraud the U.S. by obstructing the Internal Revenue Service ("IRS") in its lawful collection and assessment of individual income taxes. To that end, SCHLEGEL failed to make any payments toward the back taxes, interest and penalties levied against him in 2000, which totaled more than $600,000. SCHLEGEL failed to file federal individual tax returns for tax years 2002-2009, pursuing "tax protestor" ideologies.
On December 23, 2013, Bradley Mark Collin pleaded guilty to one count of conspiracy to defraud the United States. On November 4, 2014, Bradley Mark Collin was sentenced to federal prison for 24 months and 3 years supervised release by Federal District Court Judge Patrick J. Schiltz.
"These sentencings should send a clear message; schemes to evade the payment of taxes are a violation of the Federal Tax laws and the consequences of such schemes can and will result in significant jail time" stated IRS Criminal Investigation Special Agent in Charge Shea Jones of the St. Paul Field Office.
These cases are the result of an investigation by the IRS Criminal Investigation. They were prosecuted by Assistant U.S. Attorneys Tracy L. Perzel and John E. Kokkinen.
Defendant Information:
ANDREW SCHLEGEL, 56
Corcoran, Minn.
Convicted:
• Conspiracy to Defraud the United States, 1 count
• Attempt to Evade or Defeat Tax, 3 counts
• Willful Failure to File Tax Returns, 3 counts
Sentenced:
• 60 months in prison
• 3 years supervised release
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Minneapolis Police Officer Indicted for Criminal Civil Rights Violations for Off-Duty Use of Excessive ForceRead the Press Release
United States Attorney for the District of Minnesota Andrew M. Luger today announced an indictment charging MICHAEL LEWIS GRIFFIN, 40, a Minneapolis police officer, with assaulting at least four people while off-duty and after first identifying himself as a police officer, in violation of the Fourth Amendment to the United States Constitution which protects against the unreasonable use of physical force by law enforcement officers.
The defendant is also charged with lying on official police reports, in civil depositions and at trial. GRIFFIN is expected to appear on May 21, 2015, before Magistrate Judge Mayeron in U.S. District Court in Minneapolis, Minn.
"Police officers cannot use their shield as a weapon against innocent civilians," said U.S. Attorney Luger. "This defendant is charged with assaulting at least four people in his capacity as an off-duty officer, filing false paperwork and lying multiple times while under oath. Minneapolis is well served by the many hard-working and honest officers of the Minneapolis Police Department and I am proud of the close working relationship between the Department and my Office to address violent crime in the city. At the same time, we will not stand for those who abuse their badge and the public’s trust."
"The FBI will vigorously investigate allegations of corruption of public servants," said Special Agent in Charge of the FBI Minneapolis Division Richard T. Thornton. "No quarter will be given to those who would violate the public trust."
According to the indictment and documents filed in court, on May 29, 2010, GRIFFIN was with a friend outside of the Aqua Nightclub and Lounge (Aqua) on First Avenue in downtown Minneapolis. The defendant was off-duty and in plain clothes. GRIFFIN’s friend began arguing with a third person, I.R. The defendant displayed his badge and identified himself to I.R. as a police officer, at which point I.R. tried to walk to the Envy Nightclub about half a block away. GRIFFIN followed I.R. to the Envy Nightclub and punched him in the face until he was unconscious.
According to the indictment and documents filed in court, immediately after GRIFFIN knocked I.R. unconscious, GRIFFIN approached two on-duty Minneapolis police officers standing nearby, identified himself as a police officer, and directed them to arrest I.R. GRIFFIN later wrote a police report falsely indicating that I.R. tried to attack GRIFFIN and that GRIFFIN only punched I.R. after attempting to sweep his legs out from under him. I.R., who suffered lacerations to his lip and head, was charged subsequently with assaulting a police officer. The Minneapolis City Attorney’s Office later dismissed the charge against I.R.
According to the indictment and documents filed in court, in a separate incident on November 5, 2011, GRIFFIN verbally confronted four men at The Loop bar on Washington Avenue North in Minneapolis. GRIFFIN, who was off-duty at the time, threatened to have the men thrown out of the bar. The defendant approached the bouncer, identified himself as a police officer, displayed his badge, and directed the bouncer to throw the four men out of the bar. The bouncer complied with GRIFFIN’s command and told the men to leave.
According to the indictment and documents filed in court, GRIFFIN said he was going to call "his boys" and then followed the men out of the bar. GRIFFIN contacted his partner, Officer W.G., who was working nearby off-duty but in uniform. Officer W.G. arrived at the scene moments later in a squad car and took one of the men, M.M., into custody. As M.M. was being taken into custody, another victim, K.C., questioned where Officer W.G. was taking M.M. In response GRIFFIN grabbed K.C. from behind and threw him to the ground. After both K.C. and M.M. were in Officer W.G.’s squad car, the defendant stood outside the squad car yelling at both men.
According to the indictment and documents filed in court, GRIFFIN ordered M.M. to get out of the squad car and walk toward a loading dock area. There, GRIFFIN kicked M.M. in the chest and knocked him to the ground. Another of the men, J.A., observed the assault from a nearby taxi and approached M.M. GRIFFIN responded by punching J.A. in the head from behind, knocking him unconscious. GRIFFIN then kicked J.A. in the head. M.M. ran to seek help from Officer W.G. and also called 911 to request a "real" cop. Officer W.G. also summoned dispatch for an ambulance and a supervisor. J.A. was taken to the hospital and treated for multiple lacerations on his face and neck.
According to the indictment and documents filed in court, when additional Minneapolis police officers arrived at the scene, GRIFFIN made a false police report that resulted in M.M. being arrested for obstructing a police officer with force. The charges against M.M. were later dismissed by the Minneapolis City Attorney’s Office.
According to the indictment and documents filed in court, the defendant also indicated that J.A. instigated the original confrontation by violently pushing GRIFFIN from behind and that all four men surrounded GRIFFIN on the dance floor and threatened to "kick his ass." GRIFFIN also falsely reported that a bouncer warned him not to go outside of the bar because the men were waiting for him.
According to the indictment and documents filed in court, I.R. and the victims from the November 2011 incident filed civil law suits against GRIFFIN alleging excessive use of force. GRIFFIN lied in civil depositions taken in connection with both law suits. He testified at trial in the case related to the incident at The Loop bar and again lied under oath.
This case is the result of an investigation conducted by the Federal Bureau of Investigation.
This case is being prosecuted by Assistant United States Attorneys Steven L. Schleicher and Manda M. Sertich.
Defendant Information:
MICHAEL LEWIS GRIFFIN, 40
Plymouth, Minn.
Charges:
• Deprivation of rights under color of law, 4 counts
• Destruction, alteration, or falsification of records in Federal investigations, 2 counts
• Perjury at civil deposition, 2 counts
• Perjury at civil trial, 1 count
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
The charges contained in the indictment are merely allegations, and the defendant is presumed innocent unless and until proven guilty.
Seven Minnesota Men Indicted for ConspiracyTo Provide Material Support to the Islamic State of Iraq and the LevantRead the Press Release
United States Attorney for the District of Minnesota Andrew M. Luger and FBI Special Agent in Charge for the Minneapolis Division Richard T. Thornton today announced a superseding indictment charging seven Minnesota men with conspiracy to provide material support to a designated foreign terrorist organization, namely, the Islamic State of Iraq and the Levant (ISIL).1 An indictment filed on February 19, 2015, charging HAMZA NAJ AHMED, 21, has been superseded to add ZACHARIA YUSUF ABDURAHMAN, 19; ADNAN FARAH, 19; HANAD MUSTAFE MUSSE, 19; GULED ALI OMAR, 20; ABDIRAHMAN YASIN DAUD, 21; and MOHAMED ABDIHAMID FARAH, 21.
According to the indictment and documents filed in court, for at least the last ten months, the Minneapolis Division of the FBI has been conducting an investigation into a group of individuals who have tried to join – and in some cases succeeded in joining – overseas designated foreign terrorist organizations. At least nine Minnesotans have now been charged as part of this conspiracy to provide material support to ISIL. The men are all associates and friends of one another. Among the co-conspirators are ABDULLAHI YUSUF and ABDI NUR, both of whom were originally charged by criminal complaint in November 2014.
The superseding indictment adds ABDURAHMAN, MUSSE, OMAR, DAUD, A. FARAH, and M. FARAH to the February 19, 2015, indictment charging AHMED with conspiracy to provide material support to a designated foreign terrorist organization. The superseding indictment also adds charges of attempt to provide material support to a designated foreign terrorist organization against OMAR, M. FARAH, ABDURAHMAN, MUSSE and DAUD.
According to the indictment and documents filed in court, M. FARAH is further charged with making a false statement during a terrorism investigation, because he lied to FBI agents about the circumstances surrounding his November 2014 bus trip to JFK Airport and subsequent scheduled departure to Europe.
According to the indictment and documents filed in court, AHMED and MUSSE are also charged with financial aid fraud. On November 8, 2014, both AHMED and MUSSE withdrew more than $1,000 in federal financial aid funds to purchase international airplane tickets from New York’s JFK Airport to destinations in Europe.
This case is the result of an investigation conducted by the FBI-led Joint Terrorism Task Force.
Defendant Information:
HAMZA NAJ AHMED, 21
Savage, Minn.
Charges:
• Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
• Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 1 count
• False statement, 1 count
• Financial aid fraud, 1 count
MOHAMED ABDIHAMID FARAH, 21
Minneapolis, Minn.
Charges:
• Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
• Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 2 counts
• False statement, 1 count
HANAD MUSTAFE MUSSE, 19
Minneapolis, Minn.
Charges:
• Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
• Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 1 count
• Financial aid fraud, 1 count
GULED ALI OMAR, 20
Minneapolis, Minn.
Charges:
• Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
• Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 1 count
ZACHARIA YUSUF ABDURAHMAN, 19
Columbia Heights, Minn.
Charges:
• Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
• Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 1 count
ABDIRAHMAN YASIN DAUD, 21
Minneapolis, Minn.
Charges:
• Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
• Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 1 count
ADNAN FARAH, 19
Minneapolis, Minn.
Charges:
• Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
The charges contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Two Defendants Sentenced for Unrelated Violent Crimes Against Women on the Red Lake Indian ReservationRead the Press Release
United States Attorney Andrew M. Luger today announced the sentencing of CHRISTOPHER MICHAEL STRONG, SR., 34, to 360 months in federal prison for a violent sexual assault committed on the Red Lake Indian Reservation. On December 19, 2014, following a three-day trial, a federal jury found STRONG guilty of aggravated sexual abuse. The defendant was sentenced on May 7, 2015 before Senior Judge Richard H. Kyle, Sr. in U.S. District Court in Duluth, Minn.
As proven at trial, in June of 2014, STRONG kidnapped and physically and sexually assaulted a female victim. Over a period of three days, STRONG brutally and repeatedly abused the victim. During the trial, photographs were entered into evidence that showed in graphic detail the permanent and life-threatening injuries the victim suffered.
In a second, unrelated case, QUENTIN LEE STRONG, 29, was sentenced to 120 months in federal prison for a shooting committed on the Red Lake Indian Reservation. STRONG, who was indicted on September 24, 2014, pleaded guilty on January 26, 2015 to assault resulting in serious bodily injury. The defendant was sentenced on May 11, 2015 before Chief Judge Michael J. Davis in U.S. District Court in Duluth, Minn.
According to his guilty plea and documents filed in court, on the morning of August 19, 2014, STRONG was illegally in possession of a .22 caliber rifle, which he used outside of his house to fire multiple rounds in the direction of a female victim. One of the bullets hit the victim in her left knee.
“These are two examples of the extreme domestic violence that is present on the Red Lake Indian Reservation,” said Assistant U.S. Attorney Clifford B. Wardlaw. “These lengthy sentences send a clear message that violent acts such as these will not be tolerated.”
Because the Red Lake Indian Reservation is a federal-jurisdiction reservation, some of the crimes that occur there are investigated by the FBI in conjunction with the Red Lake Tribal Police Department. Those cases are prosecuted by the U.S. Attorney’s Office.
Violence against American Indian women occurs at epidemic rates. In 2005, Congress found that one in three American Indian women is raped during her lifetime, and American Indian women are nearly three times more likely to be battered during their lives than Caucasian women.
The U.S. Justice Department is taking steps to increase engagement, coordination, and action relative to public safety in tribal communities, including the creation of the Violence Against Women Federal and Tribal Prosecution Task Force. This task force will explore current issues raised by professionals in the field and recommend “best practices” in prosecution strategies involving domestic violence, sexual assault and stalking.
To learn more about the Justice Department’s Tribal Safety program, visit http://www.justice.gov/tribal/.
These cases resulted from an investigation conducted by the Federal Bureau of Investigation and the Red Lake Police Department.
These cases were prosecuted by Assistant U.S. Attorney Clifford B. Wardlaw.
Defendant Information:
CHRISTOPHER MICHAEL STRONG, SR., 34
Red Lake, Minn.
Convicted:
• Aggravated Sexual Abuse, 1 count
Sentenced:
• 360 months in prison
• Five years supervised release
QUENTIN LEE STRONG, 29
Redby, Minn.
Convicted:
• Assault Resulting in Serious Bodily Injury, 1 count
Sentenced:
• 120 months in prison
• Three years supervised release
###
Golden Valley Man Indicted for Leading Multi-Million Dollar Cell Phone Trafficking ConspiracyRead the Press Release
United States Attorney Andrew M. Luger and Special Agent in Charge of the United States Secret Service Minneapolis Division Louis Stephens today announced the indictment of ZIBO LI, 30, and eight co-conspirators for conspiring to traffic in stolen and fraudulently obtained cellular telephones and related charges. LI led the conspiracy, during which he trafficked at least $3.8 million in stolen cellular devices throughout the United States and between the United States and Hong Kong. LI made an initial appearance today before United States Magistrate Judge Mayeron in U.S. District Court in Minneapolis, Minn.
“According to this indictment, the criminal conspiracy dismantled today was adept at victimizing Minnesota businesses and citizens,” said Special Agent in Charge of the United States Secret Service Minneapolis Division Louis Stephens. “Today’s success is the result of close and collaborative working relationships between local, state and federal law enforcement agencies, as well as federal prosecutors and several organizations in the retail sector. The Minnesota Financial Crimes Task Force is a force multiplier that facilitates numerous law enforcement agencies in combining our resources, leveraging our various areas of expertise, and working as one. Working together, we are able to stop significant crime in its tracks.”
“As charged, these defendants stole the identifying information of nearly 60 known individuals and 20 known businesses,” said Assistant United States Attorney Manda M. Sertich. “They exploited vulnerable members of our society, including people residing in homeless shelters, to steal cell phones and turn a profit. I am proud to work with my law enforcement colleagues to put an end to this alleged conspiracy.”
According to the indictment and documents filed in court, between 2011 and 2014, ZIBO LI and eight co-defendants engaged in a conspiracy to fraudulently obtain mobile cellular devices for reduced rates by fraudulently entering into service contacts, often using identity theft. ZIBO LI ultimately sold the stolen merchandise to contacts in Hong Kong, where a new Apple iPhone could, at the time of the conspiracy, retail for as much as $2,000.
According to the indictment and documents filed in court, OMID NGANGE AKALE, DEREK KREZ MCCORMACK, and JOSEPH FRANCIS WERB, each served as middlemen in LI’s organization. They purchased stolen or fraudulently obtained phones from buyers, and subsequently sold them to ZIBO LI. LI paid the middlemen by depositing cash directly into their bank accounts.
According to the indictment and documents filed in court, buyers for the organization were responsible for obtaining low-cost phones from retailers. Among the methods employed to obtain phones was “credit muling,” a scheme through which buyers, or those acting at their direction, signed up for cellular telephone service contracts to obtain reduced cost phones in other people’s names, but never intended to or did honor those contracts. Some of the buyers also recruited people residing in homeless shelters to sign up for cell phone contracts and obtain reduced cost phones, for which those recruited received nominal payments or goods.
According to the indictment and documents filed in court, buyers often used stolen identities to enter into contracts to obtain low-cost phones. They obtained stolen identities of real victims from co-conspirators TEMETRIUS LATONYA NICKERSON and REGINALD DEMARIUS WASHINGTON. The buyers provided stolen identities to ELIJAH WAYNE JACKSON to use in the opening of cell phone service contracts from his employer, a major Twin Cities-area retailer. JACKSON ran credit checks on the stolen identities to confirm that the stolen identities could be used to enter into cell phone service contracts and obtain cellular devices using the names of the identity theft victims.
According to the indictment and documents filed in court, IFRAH ISAAK NOR and RANDOLPH KENDRICK WILLIAMS also used stolen information to fraudulently obtain cellular telephones. Rather than using stolen identity information of individuals, NOR and WILLIAMS stole the identifying information of a Twin Cities-area business, which they exploited to open business accounts with cellular telephone contract providers. Applying for business contracts allowed WILLIAMS and NOR to obtain far more low-cost phones than an individual account.
This case is the result of an investigation conducted by the United States Secret Service, Saint Paul Police Department, Minnesota Bureau of Criminal Apprehension, Minnesota Financial Crimes Task Force, University of Minnesota Police Department, and Plymouth Police Department.
This case is being prosecuted by Assistant United States Attorneys Manda M. Sertich, Steven L. Schleicher, and John R. Marti.
Defendant Information:
ZIBO LI, 30
Golden Valley, Minn.
Charges:
• Conspiracy to traffic unauthorized access devices, 1 count
• Fraud and related activity in connection with access devices, 1 count
DEREK KREZ MCCORMACK, 33
St. Louis Park, Minn.
Charges:
• Conspiracy to traffic unauthorized access devices, 1 count
• Fraud and related activity in connection with access devices, 1 count
ELIJAH WAYNE JACKSON, 21
St. Paul, Minn.
Charges:
• Conspiracy to traffic unauthorized access devices, 1 count
• Aggravated identity theft, 2 counts
TEMETRIUS LATONYA NICKERSON, 42
St. Paul, Minn.
Charges:
• Conspiracy to traffic unauthorized access devices, 1 count
• Aggravated identity theft, 1 count
REGINALD DEMARIUS WASHINGTON, 23
Brooklyn Park, Minn.
Charges:
• Conspiracy to traffic unauthorized access devices, 1 count
• Aggravated identity theft, 1 count
OMID NGANGE AKALE, 35
Minneapolis, Minn.
Charges:
• Conspiracy to traffic unauthorized access devices, 1 count
JOSEPH FRANCIS WERB, 37
Minneapolis, Minn.
Charges:
• Conspiracy to traffic unauthorized access devices, 1 count
RANDOLPH KENDRICK WILLIAMS, 27
Bloomington, MN
Charges:
• Conspiracy to traffic unauthorized access devices, 1 count
IFRAH ISAAK NOR, 23
St. Louis Park, Minn.
Charges:
• Conspiracy to traffic unauthorized access devices, 1 count
###
The charges are merely accusations, and the defendants are presumed innocent unless and until proven guilty.Seven Indicted for Trafficking Cocaine and Marijuana into Minnesota from California and Arizona via FedExRead the Press Release
United States Attorney Andrew M. Luger today announced an indictment charging ANTHONY CURTIS HARRIS, 33, and six others with conspiring to traffic cocaine and marijuana into Minnesota from California and Arizona via FedEx and the United States Postal Service.1 Additionally, some members of the conspiracy were also charged with possession with intent to distribute cocaine and others with conspiracy to commit money laundering. Six defendants have already made initial appearances in U.S. District Courts in San Diego, Calif., and in St. Paul, and Minneapolis, Minn.
“This case is an excellent example of the power of partnerships and exceptional police work,” said William Martinez, a Saint Paul Police Department assistant chief who oversees major crimes. “Any day we stop a major drug smuggling operation in its tracks is a good day. Thanks to the fine work of the Bureau of Alcohol, Tobacco, Firearms and Explosives and our officers, today is a good day for Saint Paul.”
Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Special Agent in Charge James C. Modzelewski said, “The great success of this investigation is a direct result of the strong partnership between ATF and the St. Paul Police Department. I commend the agents and officers involved in this case for their unwavering tenacity and determination in shutting down this organization that is responsible for some of the illegal drugs and firearms in the streets of St. Paul.”
According to the indictment and documents filed in court, between December 2012 and April 2, 2015, HARRIS made multiple trips from Minnesota to San Diego, California and Phoenix, Arizona to obtain drugs and arrange for their shipment to Minnesota. HARRIS and other members of the conspiracy distributed drugs and deposited the proceeds from drug sales into bank accounts and onto prepaid debit cards.
According to the indictment and documents filed in court, KEVIN BROWN, TOUSSAINT STARKS, LOPEZ WALTERS, SIMON MASON, DONALD WILLIAMS, and DARION ESTIS each participated in the drug trafficking scheme. The defendants sent, received, and distributed drugs, or laundered money on HARRIS’ behalf. On December 20, 2013, law enforcement intercepted a package containing 24.9 pounds of marijuana which was sent to the FedEx Office in Maplewood, Minn. from a FedEx account used by HARRIS. On June 20, 2014, a package containing approximately one kilogram of cocaine was shipped from a FedEx Office in San Diego, Calif. and was picked up the next day by STARKS at a FedEx Office in Eden Prairie, Minn. Between December 2012 and September 2014, hundreds of packages containing a total of more than 1,000 kilograms of marijuana were shipped through the U.S. Postal Service and multiple FedEx accounts linked to HARRIS.
According to the indictment and documents filed in court, during the indicted period, the defendants used multiple bank accounts to promote and conceal the drug trafficking conspiracy. As part of a money laundering scheme, more than $1.2 million dollars in cash was deposited in Minnesota, in bank accounts linked to HARRIS. The deposited funds, which ranged from approximately $2,000 to $9,000 per deposit, were almost immediately withdrawn from the accounts from locations in California.
The indictment is the result of an investigation conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the St. Paul Police Department, the United States Postal Service Inspections, and the Internal Revenue Service. This case is being prosecuted by Assistant U.S. Attorney Amber M. Brennan.
Defendant Information:
ANTHONY CURTIS HARRIS, 33
San Diego, Calif.
Charges:
• Conspiracy to Distribute Marijuana and Cocaine, 1 count
• Possession with Intent to Distribute Cocaine, 1 count
• Conspiracy to Commit Money Laundering, 1 count
KEVIN TERRELL BROWN, 38
Eagan, Minn.
Charges:
• Conspiracy to Distribute Marijuana and Cocaine, 1 count
• Conspiracy to Commit Money Laundering, 1 count
TOUSSAINT DAVID STARKS, 46
Bloomington, Minn.
Charges:
• Conspiracy to Distribute Marijuana and Cocaine, 1 count
• Possession with Intent to Distribute Cocaine, 1 count
LOPEZ MORRIS WALTERS, 33
New Brighton, Minn.
Charges:
• Conspiracy to Distribute Marijuana and Cocaine, 1 count
SIMON LEE MASON, 33
St. Paul, Minn.
Charges:
• Conspiracy to Distribute Marijuana and Cocaine, 1 count
• Conspiracy to Commit Money Laundering, 1 count
DONALD BERNARD WILLIAMS, JR., 26
Inver Grove Heights, Minn.
Charges:
• Conspiracy to Distribute Marijuana and Cocaine, 1 count
DARION SCOTT ESTIS, 33
Shoreview, Minn.
Charges:
• Conspiracy to Commit Money Laundering, 1 count
###
The charges contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Daniel Musa Sentenced to 51 Months in Prison for Using Withheld Employee Taxes for His Own BenefitRead the Press Release
United States Attorney Andrew M. Luger announced the sentence of DANIEL NOK MUSA, 56, to 51 months in prison for withholding taxes from his employees but failing to pay them to the Internal Revenue Service. The defendant was sentenced on April 22, 2015, before U.S. District Judge John R. Tunheim in Minneapolis, Minn.
According to his guilty plea and documents filed in court, between 2002 and October 31, 2009, MUSA owned and operated home health care businesses known generally as “Life Care.” His employees were personal care attendants. As the owner of this business, MUSA withheld income taxes and Social Security and Medicare taxes from his employees’ paychecks. However, beginning in 2002, MUSA did not pay the full amounts owed, and repeatedly paid little or nothing to the IRS. Beginning in March 2006 and for the 12 subsequent tax quarters, MUSA paid only a portion or none of the money withheld from his employees’ paychecks. During that period, MUSA deducted a total of $101,340 from his employees’ paychecks and kept $85,122 for his own personal use. In total, MUSA failed to pay $284,000 in employment taxes.
According to his guilty plea and documents filed in court, MUSA evaded paying taxes by, among other things, falsely telling revenue officers that he was shutting down his business, when in fact he only shifted his business into different shells. For example, in 2005, MUSA operated Life Care as a sole proprietorship called Life Care Home Health Care. When the IRS began trying to collect unpaid unemployment taxes, MUSA reconstituted Life Care as Life Care Home Health, LLC. In 2006, MUSA again changed the name of the entity to avoid taxes, this time calling it Life Care PCA, LLC. MUSA reconstituted the business between 2007 and 2013 under four additional names to avoid paying taxes.
According to his guilty plea and documents filed in court, MUSA spent the money he stole on an extravagant lifestyle. He bought multiple houses, luxury vehicles, and other extravagances. MUSA also spent a large amount of money at Mystic Lake Casino, losing between $1,000 and $2,000 per week. Between 2006 and 2011, MUSA was at Mystic Lake at least 462 times.
The investigation was conducted by the Internal Revenue Service-Criminal Investigations Division.
This case was prosecuted by Assistant United States Attorney Michael L. Cheever.
Defendant Information:
DANIEL NOK MUSA, 56
Shakopee, Minn.
Convicted:
• Failure to account for and pay over withheld taxes, 14 counts
Sentenced:
• 51 months in prison
• 3 years supervised release
• $284,000 restitutionSix-day Trial Results in Guilty Verdict of Blaine Man for Trafficking 18-year-old VictimRead the Press Release
United States Attorney Andrew M. Luger today announced the conviction after a jury trial of RAHMAD LASHAD GEDDES, a/k/a “Face,” a/k/a “Poo Poo,” 36, for trafficking an 18-year- old woman from Wisconsin to Duluth, Minn., for the purpose of commercial sex. On April 8, 2015, GEDDES was charged by indictment with one count of sex trafficking by force, fraud, or coercion, one count of transportation with intent to engage in prostitution, and one count of armed career criminal in possession of a firearm. Following a six-day trial, a jury found GEDDES guilty of all counts in the indictment.
As proven at trial, on January 6, 2014, GEDDES recruited the victim from her home in Eau Claire, Wis., for the purpose of trafficking her for commercial sex. The defendant and a friend took the victim to a motel in Duluth, Minn., where they took pictures of her to place an advertisement for commercial sex on backpage.com. GEDDES used an anonymous prepaid credit card to pay for the online advertisement. GEDDES and his friend used the victim’s cell phone to set up several “dates” between the victim and “johns.” On one occasion, after a meeting with a “john,” GEDDES accused the victim of hiding money. The defendant physically assaulted the victim and told her that he hit her because she did not do what she was told.
As proven at trial, on January 9, 2014, GEDDES traded drugs, which he referred to as “rocks,” for two semi-automatic handguns and ammunition. GEDDES has four previous felony convictions in Cook County, Ill., Hennepin County and Sherburne County, Minn., making him an armed career criminal under federal law.
As proven at trial, on January 14, 2014, GEDDES returned the victim to her home. She immediately reported to her pastor that she “had been used for prostitution.”
This case is the result of an investigation conducted by the Federal Bureau of Investigation, Homeland Security Investigations, Duluth Police Department and St. Louis County Sheriff’s Office.
Assistant U.S. Attorney Laura M. Provinzino and Special Assistant U.S. Attorney Jon Holets of the St. Louis County Attorney’s Office are prosecuting the case.
Defendant Information:
RAHMAD LASHAD GEDDES, a/k/a “Face,” a/k/a “Poo Poo,” 36
Blaine, Minn.
Convicted:
• Sex Trafficking by Force, Fraud, or Coercion, 1 count
• Transportation with Intent to Engage in Prostitution, 1 count
• Armed Career Criminal in Possession of a Firearm, 1 countMountain Lake Man Sentenced to 17 Years for Production of Child PornographyRead the Press Release
United States Attorney Andrew M. Luger today announced the sentencing of DAVID LARRY RASMUSSEN, 42, to 204 months in federal prison for production of child pornography. RASMUSSEN was indicted on May 21, 2013, and pleaded guilty on March 11, 2013, to three counts of Production of Child Pornography. The defendant was sentenced today before Judge David S. Doty in U.S. District Court in Minneapolis, Minn.
According to the defendant’s guilty plea and documents filed in court, RASMUSSEN produced and traded child pornography images and videos on-line. He took pictures of three children, ages 4, 3, and one and a half, in their homes and in his own home in Mountain Lake, Minn. On October 27, 2012, RASMUSSEN’S computers were seized by the Mountain Lake Police Department. Law enforcement conducted a search of the computers and found thousands of images and videos of prepubescent children subjected to sexual penetration, and included bondage and violent materials.
In a sentencing position filed with the court, the federal prosecutor argued for a significant sentence: He argued that RASMUSSEN “victimized the children of neighbors who trusted him in order to produce and distribute child pornography for the sexual gratification of himself and his friends” and that RASMUSSEN also “stored and distributed an astonishing amount of child pornography depicting the rape and torture of children.”
RASMUSSEN has been in custody since he was arrested on the federal charges on May 28, 2013. Prior to that, Rasmussen had been facing state charges.
This case resulted from an investigation conducted by the Mountain Lake Police Department and the Federal Bureau of Investigation.
The case was prosecuted by Assistant U.S. Attorney Thomas Calhoun-Lopez.
Production and distribution of child pornography is against the law. In addition to prosecuting these cases, the Justice Department is presently funding a study focused on the correlation between involvement in child pornography and hands-on sexual abuse of children. A 2008 study (The Butner Study) published in the Journal of Family Violence found that up to 80 percent of federal inmates incarcerated for possession, receipt, or distribution of child pornography also admitted to hands-on sexual abuse of children, ranging from touching to rape.
This case is part of Project Safe Childhood (PSC), a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, PSC marshals resources to locate, apprehend, and prosecute individuals who sexually exploit children while identifying and rescuing victims. For more information about PSC, please visit http://www.justice.gov/psc/ For more information about internet safety education, please visit http://www.justice.gov/psc/resources.html and click on the tab “resources.”
Defendant Information:
DAVID LARRY RASMUSSEN, 42
Mountain Lake, Minn.
Convicted:
• Production of Child Pornography, 3 counts
Sentenced:
• 204 months in prison
• 10 year term of supervised releaseEast Grand Forks Construction Company Pays $1.85 Million to Resolve False Claims AllegationsRead the Press Release
United States Attorney Andrew M. Luger today announced that R.J. Zavoral & Sons, Inc., John Zavoral, Peter Zavoral and Craig Pietruszewski have agreed to pay $1.85 million to resolve allegations that they violated the False Claims Act and the Financial Institutions Reform, Recovery, and Enforcement Act by making false statements to the Small Business Administration (SBA) and the U.S. Army Corps of Engineers. The allegations related to the Heartsville Coulee Diversion construction contract for flood control work in and around East Grand Forks, Minnesota, mainly performed between 2004 and 2008.
“Congress created the SBA’s 8(a) program to give meaningful opportunities to deserving disadvantaged small businesses across the country,” said Assistant U.S. Attorney David W. Fuller. “We will continue to work with our agency partners to identify and pursue instances where companies attempt to take advantage of the 8(a) program and others like it.”
According to the allegations, the U.S. Army Corps of Engineers had set aside the contract for the Heartsville construction project for a qualified Section 8(a) business concern under the SBA’s Section 8(a) Business Development Program. For the purpose of qualifying for the contract award, R.J. Zavoral & Sons entered into a joint venture with a qualified Section 8(a) business. The United States alleged that the Defendants made numerous false statements to both the SBA and the Corps of Engineers in order to be awarded the Heartsville Coulee Diversion Section 8(a) contract, to retain the contract, and to claim and receive payments of federal monies made under the contract. The actions of Defendants resulted in harm to the Section 8(a) business concern and caused the United States to pay significant amounts of money to the Joint Venture with little or no benefit to the Section 8(a) Business Development Program.
“The purpose of the 8(a) Program is to promote the business development of eligible small business concerns owned and controlled by socially and economically disadvantaged individuals so that such concerns can compete on an equal basis in the American economy,” said Melvin F. Williams Jr., SBA’s General Counsel. “This settlement sends a clear message that the United States Attorney’s Office will aggressively pursue allegations of fraud against the SBA Section 8(a) Program, which is so vitally important to the nation’s economy and to the many disadvantaged small businesses that participate in the program. This settlement protects the integrity of this critical program.”
This case is the result of a cooperative investigation conducted by the Small Business Administration, the Department of Defense Office of the Inspector General, and the Defense Contract Audit Agency.
The underlying case is United States v. R.J. Zavoral & Sons, Inc.; John T. Zavoral; Peter M. Zavoral; and Craig A Pietruszewski, Civil No. 12-cv-00668 (MJD/LIB).Six Minnesota Men Charged with Conspiracy to Provide Material Support to the Islamic State of Iraq and the LevantRead the Press Release
Four defendants arrested in Minneapolis; two arrested in San Diego
United States Attorney for the District of Minnesota Andrew M. Luger, FBI Special Agent in Charge for the Minneapolis Division Richard T. Thornton, and Assistant Attorney General for National Security John Carlin today announced a criminal complaint charging six Minnesota men with conspiracy and attempt to provide material support to a designated foreign terrorist organization, namely, the Islamic State of Iraq and the Levant (ISIL). ZACHARIA YUSUF ABDURAHMAN, 19; ADNAN FARAH, 19; HANAD MUSTAFE MUSSE, 19; and GULED ALI OMAR, 20, were arrested yesterday in Minneapolis. ABDIRAHMAN YASIN DAUD, 21, and MOHAMED ABDIHAMID FARAH, 21, were arrested yesterday in San Diego, California.“As described in the criminal complaint, these men worked over the course of the last 10 months to join ISIL,” said U.S. Attorney Luger. “Even when their co-conspirators were caught and charged, they continued to seek new and creative ways to leave Minnesota to fight for a terror group. I applaud the hard work and tireless efforts of the FBI Minneapolis Division and their colleagues around the country.”
“Preventing acts of terrorism is the FBI's highest priority,” said FBI Special Agent in Charge Thornton. “Disrupting individuals from traveling to join and fight for ISIL is an important part of our counter terrorism strategy. As a result of this investigation and arrests, these six Minnesota men who planned to travel and fight for ISIL will answer these charges in U.S. District Court instead of taking up arms in Syria. The FBI remains committed to ending both recruitment efforts and travel on the part of young people from Minnesota to fight overseas on behalf of terror groups. These arrests today signify this continued commitment.”The charges contained in the complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
“The six defendants charged in the complaint allegedly planned to travel to Syria as part of their conspiracy to provide material support to ISIL,” said Assistant Attorney General Carlin. “One of the National Security Division’s highest priorities is to identify, disrupt, and hold accountable those who provide or attempt to provide material support to designated foreign terrorist organizations. I would like to thank the many agents, analysts, and prosecutors who are responsible for this investigation and the charges in this case.”
“I want to commend the work of the FBI's Joint Terrorism Task Force who worked countless hours in support of our law enforcement partners in Minnesota,” said U.S. Attorney for the Southern District of California Laura E. Duffy. “We are satisfied that because of these arrests, we have furthered our mission to safeguard national security by preventing individuals from joining ISIL, a foreign terrorist organization that threatens to induce our youth into committing violence against foreigners and U.S. citizens alike.”
According to the criminal complaint and documents filed in court, for the last ten months, the Minneapolis Division of the FBI has been conducting an investigation into a group of individuals who have tried to join – and in some cases succeeded in joining – overseas designated foreign terrorist organizations. At least nine Minnesotans have now been charged as part of this conspiracy to provide material support to ISIL. The men are all associates and friends of one another. Among the co-conspirators are ABDULLAHI YUSUF and ABDI NUR, both of whom were originally charged by criminal complaint in November 2014, and HAMZA AHMED, who was indicted in February 2015.
ABDI NUR boarded a flight on May 29, 2014, bound for Turkey and has not returned to the United States. He called a relative on June 6, 2014, from a telephone number bearing the country code for Turkey, “90”. NUR told his relative that he had reached his destination and that he would not be calling again. This same telephone number was used three weeks later by another man who traveled from the Twin Cities to Syria to join ISIL.
According to the criminal complaint and documents filed in court, on June 3, 2014, a person identified in court documents as Y.J., purchased both a round-trip ticket from JFK International Airport to Istanbul, Turkey, and a bus ticket from Minneapolis to New York. He departed JFK on June 9, 2014, for Istanbul. He has not returned to the United States. On June 25, 2014, Y.J. called a family member, also using the same Turkish telephone number referenced previously.
According to the criminal complaint and documents filed in court, OMAR tried to travel on November 6, 2014, on a flight from Minneapolis/St. Paul International Airport to San Diego, California. Before he could board the flight, OMAR was stopped at the airport in Minnesota and not allowed to board. OMAR had planned previously to leave the United States in May 2014 to join ISIL, but later abandoned his immediate plans to travel after being confronted by his family.
According to the criminal complaint and documents filed in court, between November 6 and November 8, 2014, M. FARAH, MUSSE, ABDURAHMAN, and previously indicted co-conspirator HAMZA AHMED, traveled by bus to New York City. M. FARAH, MUSSE and ABDURAHMAN were stopped before boarding international flights from JFK to various destinations in Southeastern Europe in an attempt to travel to Syria to join ISIL.
According to the criminal complaint and documents filed in court, after the failed attempts to travel in November 2014, MUSSE, M. FARAH, ABDURAHMAN, and OMAR were joined in their discussions by DAUD, A. FARAH, and a seventh person, who was also a confidential human source (CHS). Members of this group discussed a plan to obtain false passports for another attempt to leave the United States for Syria. The CHS later informed OMAR that he had obtained a source for forged passports in San Diego, California.
According to the criminal complaint and documents filed in court, between March 30 and April 9, 2015, several of the defendants provided photographs and cash payments to the CHS for use in obtaining their fake passports.
According to the criminal complaint and documents filed in court, at approximately 8:15 p.m. on April 17, 2015, M. FARAH, DAUD and the CHS left Minneapolis in DAUD’s vehicle, bound for San Diego, California.
This case is the result of an investigation conducted by the FBI-led Joint Terrorism Task Force.
Defendant Information:
ZACHARIA YUSUF ABDURAHMAN, 19
Columbia Heights, Minn.
Charges:- Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
- Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 1 count
Minneapolis, Minn.Charges:
- Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
- Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 1 count
ADNAN FARAH, 19
Minneapolis, Minn.Charges:
- Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
- Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 1 count
MOHAMED ABDIHAMID FARAH, 21
Minneapolis, Minn.Charges:
- Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
- Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 1 count
HANAD MUSTAFE MUSSE, 19
Minneapolis, Minn.Charges:
- Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
- Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 1 count
GULED ALI OMAR, 20
Minneapolis, Minn.Charges:
- Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
- Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 1 count
The charges are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Investment Advisors Indicted for Operating Ponzi Scheme to Defraud Investors for Millions of DollarsRead the Press Release
Jeffrey Gardner and Stuart Voigt charged with using real estate scheme to steal millions
United States Attorney Andrew M. Luger today announced a superseding indictment charging JEFFERY ALLEN GARDNER, 61, and STUART ALAN VOIGT, 66, for conspiring to defraud individuals and financial institutions. In an indictment unsealed on July 24, 2014, GARDNER was charged with conspiracy to commit mail and wire fraud and other charges. In a superseding indictment filed today, VOIGT is also charged with conspiracy to commit mail fraud and other charges, and both defendants are additionally charged with bank fraud and making a false statement in a loan application.
“Those who hold positions of responsibility in the banking and investment industries are duty- bound to be honest and forthright with their clients,” said U.S. Attorney Luger. “We will continue to work with all of our federal and state partners to protect this important principle.”
According to the indictment and documents filed in court, between 2005 and 2007, GARDNER and VOIGT solicited and raised funds from private investors in connection with GARDNER’S business entity, Hennessey Financial, LLC (Hennessey). Investors were told that their investment would be used for commercial real estate financing and related projects, and were promised returns of between 10 and 20 percent annually. However, according to the superseding indictment, GARDNER, VOIGT, and others misrepresented the true financial circumstances of Hennessey to the victim investors.
According to the indictment and documents filed in court, GARNDER did not use Hennessey’s funds substantially as promised, instead diverting them to unapproved uses, including for repayments to prior investors and preexisting debts incurred by GARDNER and his companies. Moreover, even when GARDNER knew that Hennessey was failing as a business and unlikely to meet its obligations to repay investor funds, his company’s communications still represented to investors that their investments had positive value and were expected to continue to yield previously promised returns.
According to the indictment and documents filed in court, during the time period when Hennessey was failing, GARDNER and VOIGT created new companies, opened bank accounts in the names of new companies, transferred funds from Hennessey accounts, and took other steps to hide income and assets from investors, creditors, and the government.
According to the indictment and documents filed in court, VOIGT knowingly engaged in monetary transactions of criminally derived property, namely multiple payments exceeding $50,000 each drawn from a Hennessey Financial account and made payable to VOIGT. During this same time period, VOIGT was the chairman of the board of First Commercial Bank (FCB). According to the charges, in order to keep Hennessey afloat and provide funds to funnel back to VOIGT, GARDNER and VOIGT secured loans for GARDNER from FCB without truthfully disclosing GARDNER’S financial situation. The defendants filed security interests and took other steps to allow another company to obtain Hennessey assets that GARDNER had presented as security for the loans from FCB, thereby depriving FCB of collateral and reducing the likelihood that FCB would be made whole.
According to the indictment and documents filed in court, GARDNER also misrepresented the reason Hennessey’s CFO resigned in early 2008. He told FCB that the CFO had been dismissed because he was only working 20 hours per week and was having family issues, when in truth, the CFO resigned due to concerns he had about Hennessey’s financial condition and representations made to investors.
According to the indictment and documents filed in court, VOIGT also made false statements to Tradition Capital Bank (TCB) in connection with a personal loan. VOIGT is charged with misrepresenting the value of his assets in personal financial statements made to the bank.
This case is the result of an investigation conducted by the United States Postal Inspection Service, Federal Bureau of Investigation, the Federal Deposit Insurance Corporation Office of the Inspector General, and the Minnesota Department of Commerce – Fraud Bureau.
This case is being prosecuted by Assistant U.S. Attorney Robert M. Lewis.
Defendant Information:
JEFFERY ALLEN GARDNER, 61
Hopkins, Minn.
Charges:
• Conspiracy to commit mail fraud, 2 counts
• Mail fraud, 4 counts
• Bank fraud, 5 counts
• False statement on a loan application, 7 counts
• Monetary transactions in criminally-derived property, 1 count
STUART ALAN VOIGT, 66
Apple Valley, Minn.
Charges:
• Conspiracy to commit mail fraud, 2 counts
• Mail fraud, 4 counts
• Bank fraud, 5 counts
• False statement on a loan application, 7 counts
• Monetary transactions in criminally-derived property, 16 counts
• False statement to the FDIC, 2 countsThe charges are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Inmate at Stillwater Correctional Facility Indicted for Conspiring to Steal $180,000 from IrsRead the Press Release
United States Attorney Andrew M. Luger today announced the indictment of ELISEO ORTIZ, 49, STACEY JEAN BERGHAMMER, 33, and SHANNON LEE TROLLEN, 37, for conspiring to file false state and federal tax returns and claim tax refunds. The three defendants are charged with conspiracy to file false claims for income tax refunds. ORTIZ and BERGHAMMER are also charged with filing false claims for income tax refunds, and ORTIZ is additionally charged with procuring a false tax return.
“Eliseo Ortiz is charged with conspiring to file fraudulent tax returns from behind bars,” said U.S. Attorney Luger. “Conspiring with associates on the outside is a nefarious way to steal from the public. I am grateful to the investigators at IRS Criminal Investigation for pursuing cases like these on behalf of honest taxpayers.”
“The defendants who allegedly perpetrated this tax fraud scheme systematically defrauded the government and the taxpaying public,” said Special Agent in Charge Shea Jones, of the St. Paul Field Office IRS Criminal Investigation. “IRS Criminal Investigation will continue to vigorously pursue those who unjustly enrich themselves by preparing false tax returns in order to obtain refunds.”
According to the indictment and documents filed in court, between 2008 and at least April 28, 2010, ORTIZ was incarcerated at Stillwater Correctional Facility, where he recruited other inmates to provide names and social security numbers for the defendants to use in preparing and filing the false tax returns. These “recruits” were also asked to provide addresses for unincarcerated trusted associates who could transfer money from tax refunds to the defendants and other co-conspirators. ORTIZ provided the information he obtained from the recruits to BERGHAMMER or TROLLEN, who would then complete and file the false tax returns that fraudulently claimed refunds to which the recruits were not entitled.
According to the indictment and documents filed in court, the defendants and other co- conspirators filed tax returns claiming false wages, withholdings, and other information. Many of the fraudulent tax returns falsely claimed that the recruits were entitled to tax credits such as the earned income tax credit, the making work pay credit, and the additional child tax credit. In reality, the recruits had not earned the income that was reported, they had not had any income tax withholdings, they were not eligible for the tax credits listed, and they were not entitled to refunds claimed.
According to the indictment and documents filed in court, the defendants and other co- conspirators obtained payments for their roles in the scheme in various ways. If an income tax refund for a filing co-conspirator was issued by check, payments were sometimes obtained by having the check sent to the address of a trusted associate who was not in prison, cashing the check, and then splitting the money between the co-conspirator, the defendants, and others. If a refund was obtained through a direct deposit or into a debit card, payments to the co-conspirators and defendants were sometimes made by using money orders and wire transfers.
This case is the result of an investigation conducted by the Internal Revenue Service – Criminal Investigation Division.
This case is being prosecuted by Assistant U.S. Attorney Michael L. Cheever.
Defendant Information:
ELISEO ORTIZ, 49
Bartlett, Ill.
Charges:
• Conspiracy to file false claims, 1 count
• False Claims, 3 counts
• Procuring a False Tax Return, 1 count
STACEY JEAN BERGHAMMER, 33
Red Wing, Minn.
Charges:
• Conspiracy to file false claims, 1 count
• False Claims, 3 counts
SHANNON LEE TROLLEN, 37
Stockholm, Wisc.
Charges:
• Conspiracy to file false claims, 1 countThe charges are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Christopher Lindsey Sentenced to 15 Years in Prison for Orchestrating Elaborate Fraud and Identity Theft ConspiracyRead the Press Release
United States Attorney Andrew M. Luger today announced the sentence of CHRISTOPHER LINDSEY, 42, to 15 years in prison for orchestrating an identity theft, check, and tax fraud scheme that spanned more than 10 years. The defendant was sentenced on April 13, 2015, before Judge Donovan W. Frank.
“Christopher Lindsey is responsible for compromising the bank accounts of thousands of victims,” said Assistant U.S. Attorney Lola A. Velazquez-Aguilu. “He enlisted countless individuals into his schemes to steal hundreds of thousands of dollars from banks and from taxpayers. The money he stole may never be repaid, but the fifteen-year sentence brings some measure of justice to those people whose lives he impacted.”
According to his guilty plea and documents filed in court, between October 2002 and December 2013, LINDSEY coordinated an elaborate fraud and identity theft scheme. The defendant obtained legitimate bank account information, including names and addresses of businesses and individuals, bank routing and account numbers, check numbers, and signatures, from a variety of sources, including approximately 20,000 stolen checks. LINDSEY used that stolen information to make counterfeit checks, which were later cashed or deposited at various financial institutions and businesses throughout the Twin Cities. In total, LINDSEY and his co-conspirators attempted to steal more than $1 million.
According to his guilty plea and documents filed in court, LINDSEY simultaneously led a conspiracy to submit false tax returns to the IRS. The defendant and his co-conspirators recruited individuals to file fraudulent tax returns. LINDSEY created fraudulent W-2s for the recruits, on which he combined the correct information of his co-conspirators, including names, dates of birth, and social security numbers, along with false information regarding employment, earnings, and withholdings. LINDSEY directed the filing of at least 40 fraudulent claims resulting in losses of more than $270,000.
These fraudulent tax refunds were loaded onto debit cards issued to some of the defendant’s co- conspirators. They, in turn, provided the debit cards to LINDSEY, who used them at make cash withdrawals from ATMs.
The investigation was conducted by the Minnesota Financial Crimes Task Force, which is comprised of the U.S. Secret Service, the U.S. Postal Inspection Service, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, the Internal Revenue Service- Criminal Investigations Division, the Minneapolis Police Department, the St. Paul Police Department, the Edina Police Department, the Duluth Police Department, the Ramsey County Sheriff’s Office, the Mille Lacs County Sheriff’s Office, and the Minnesota Bureau of Criminal Apprehension.
This case was prosecuted by Assistant United States Attorney Lola A. Velazquez-Aguilu.
Defendant Information:
CHRISTOPHER LINDSEY, 42
Brooklyn Park, Minn.
Convicted:
• Conspiracy to commit bank and wire fraud, 1 count
• Conspiracy to defraud the United States, 1 count
• Aggravated identity theft, 1 count
Sentenced:
• 180 months in prison
• 5 years supervised release