Eastern District of Missouri
Press releases recorded for this federal judicial district.
Warren County Man Sentenced for Transporting a Minor Across State LinesRead the Press Release
St. Louis, MO – Christopher Schroeder was sentenced to 15 years in prison on charges of transporting a minor across state lines to engage in criminal sexual activity.
According to court documents, in late October 2015 or early November 2015, Schroeder met a 15-year-old female through KIK, an internet chat forum, who was living in Brooklyn, Ohio. Schroeder drove to Brooklyn and picked her up at an agreed upon location, and drove them to his residence in Marthasville, MO. Sometime after arriving at his home, he engaged in sexual intercourse with her, and he recorded two of the sex acts without her knowledge.
Schroeder, Marthasville, MO, pled guilty in July to one felony count of transportation of a minor with intent to engage in criminal sexual activity. He appeared today for sentencing before United States District Judge Henry Autrey.
This case was investigated by the Federal Bureau of Investigation, the Brooklyn Police Department, St. Charles County Internet Crimes Against Children Task Force and the Warren County Sheriff’s Department. Assistant United States Attorney Colleen Lang handled the case for the U.S. Attorney’s Office.
Dent County Woman Sentenced on Federal Fraud ChargesRead the Press Release
St. Louis, MO – Demea Loyd, Salem, MO, was sentenced to three months in prison, plus six months of home confinement, on wire fraud charges involving her embezzlement from Sears. Additionally, she was ordered to pay restitution of $358,805.
According to court documents, Loyd owned two stores in Washington and Rolla, Missouri. She entered into a contract with Sears Authorized Hometown Stores, LLC to exclusively distribute Sears merchandise from these two stores. The contract called for Loyd to distribute Sears merchandise on a consignment basis. In exchange, Loyd was paid a commission based on the amount of sales. Loyd was to deposit all proceeds from the sale of the merchandise at each store into a “holding” account until they could be transferred to Sears. From April 2013 to December 2014, Loyd embezzled $358,805 from Sears, by making unauthorized withdrawals from the holding account and falsifying the monthly statements to hide the missing funds.
Loyd pled guilty in May to one count of wire fraud and appeared today for sentencing before United States District Judge John Ross.
This case was investigated by the Federal Bureau of Investigation and the Rolla and Washington, Missouri, Police Departments. Assistant United States Attorney John Ware handled the case for the U.S. Attorney’s Office.
Local Woman Indicted on Federal Fraud ChargesRead the Press Release
St. Louis, MO – Deborah Pierce, St. Louis, Missouri, was indicted today for embezzling more than $380,000 from a joint educational venture between her employer, Webster University, and a Chinese government cultural agency.
According to the indictment, Pierce was appointed the director of the Confucius Institute at Webster University and was entrusted with the oversight of the Institute’s funding, which came mainly from Webster University and the People’s Republic of China. According to the indictment, in September 2013, Pierce established a separate, unauthorized bank account over which she had sole control and directed the funds of the Confucius Institute through it.
Between September 2013 and June 2016, it is alleged that Pierce diverted more than $380,000 to herself from the Institute’s funds by writing checks to cash, checks to herself and paying various personal bills and accounts and those of her family members.
If convicted of mail fraud, Pierce faces a term of imprisonment of up to 20 years, a fine of up to $250,000 or both. Restitution to the victims is mandatory, and the government is seeking to forfeit a money judgment for all of the embezzled funds.
The case was investigated by the FBI and the U.S. Postal Inspection Service with assistance from Webster University. Assistant United States Attorney Tom Albus is handling the case for the U.S. Attorney’s Office.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
Statement from U.S. Attorney Regarding Fox School DistrictRead the Press Release
The United States Attorney’s Office has closed its investigation into certain spending issues regarding the Fox School District and former Fox Superintendent Dianne Critchlow. The investigation was triggered by a report issued by the Missouri State Auditor in May of this year. The investigation has concluded with the finding that there is no basis for criminal charges. The School District has been notified.
Local Man Sentenced to 35 Years on Charges Involving an Armed Assault on Arch PropertyRead the Press Release
St. Louis, MO – Kilwa Jones, St. Louis, MO, was sentenced to 35 years in prison on multiple charges involving the September 25, 2015, shooting of Christopher Sanna, as well as the robberies of both Sanna and his companion, Lisa Simpson. The robberies and the assault occurred near the Old Cathedral in the northbound lanes of Memorial Drive, which is part of the Jefferson National Expansion Memorial.
According to court documents, on September 25, 2015, victims Christopher Sanna and Lisa Simpson were walking back to their car, which was parked on the Old Cathedral parking lot, after attending a St. Louis Cardinals baseball game. Kilwa Jones confronted them with a semi-automatic pistol and demanded their property. As the victims attempted to ignore Jones and walk toward their vehicle, Jones shot Sanna in the back, rifled his pants pockets as he lay paralyzed on the ground and forcibly grabbed Simpson’s purse. Jones then jumped into a car and drove away.
Jones pled guilty in July to assault with a dangerous weapon while on federal property, possession of a firearm in furtherance of a crime of violence, two counts of robbery while on federal property and the charge of being a felon in possession of a firearm. He appeared today for sentencing before United States District Judge Catherine D. Perry.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the St. Louis Metropolitan Police Department. Assistant United States Attorney John Bird handled the case for the U.S. Attorney’s Office.
United States Attorney's Office for the Eastern District of Missouri has Established a Hotline for Handling Election Fraud and Voting Rights CallsRead the Press Release
St. Louis, MO - United States Attorney Richard Callahan today announced that on Election Day, the United States Attorney’s Office will have a hotline for citizens to call on election day regarding complaints of possible election fraud, voter intimidation and any other forms of election abuses. Hotline calls will be answered by Assistant United States Attorneys from the time the polls open at 6 a.m. until the polls close at 7 p.m. The hotline number is 314-539-7733.
Federal law protects against such crimes as intimidating or bribing voters, buying and selling votes, impersonating voters, altering vote tallies, stuffing ballot boxes and marking ballots for voters against their wishes or without their input. Federal law also protects voters from acts of intimidation and harassment.
In addition to the United States Attorney’s Office, the St. Louis FBI will also have special agents available to receive allegations of election fraud and other election abuses on election day. The St. Louis FBI field office can be reached by the public at 314-589-2500.
Complaints about possible violations of the federal voting rights laws can also be made directly to the Civil Rights Division’s Voting Section in Washington, DC by phone at 1-800-253-3931 or (202) 307-2767, by fax at (202) 307-3961, by email to [email protected] or by complaint form at http://www.justice.gov/crt/complaint/votintake/index.php.
United States Attorney Callahan said, "Ensuring free and fair elections depends in large part on the cooperation and vigilance of the American people. It is imperative that those who have specific information about discrimination or election fraud report that information to the local election authority, my office, the FBI or the Civil Rights Division."
East St. Louis Man Pleads Guilty to Kidnapping ChargesRead the Press Release
St. Louis, MO – Damarcus Boyd, aka Mez, pled guilty to charges involving a September 2015 kidnapping.
According to court documents, in September 2015, co-defendant Ortega Mitchell, aka Munk Milano, and the victim agreed that the victim would travel to St. Louis from San Diego, California, in connection with a marijuana transaction. Unknown to the victim, Mitchell, Boyd and co-defendant Darius Rose planned to kidnap the victim and hold him for ransom.
On September 25, the victim flew from San Diego, California, to St. Louis where he was picked up by Boyd and Mitchell and taken to a house in Illinois. When they entered the house, the victim was confronted by Rose with an assault rifle. Rose threatened to blow the victim’s brains out and ordered him onto the floor. The kidnappers rifled through the victim’s pockets and took his cell phone and wallet. Boyd bound the victim’s hands and feet with duct tape, and the kidnappers kept him captive in a bedroom of the house.
On September 26, Rose made various ransom calls to the victim’s father demanding $100,000 and marijuana. Rose, sometimes accompanied by Boyd, left the house in Illinois and traveled to the Glenfield Apartments in Overland, Missouri, to make the ransom calls. The victim’s family contacted law enforcement, and the Federal Bureau of Investigation (FBI) became involved.
Finally, on September 30, Rose, Mitchell and Boyd drove the victim from Illinois to the area of Columbia and Hampton in the City of St. Louis. The kidnappers told the victim to get out of the vehicle and drove away, leaving the victim in the street. The victim walked to a nearby gas station and called his father to inform him he had been freed.
Boyd, East St. Louis, Illinois, pled guilty to one count of conspiracy to kidnap before United States District Ronnie L. White. Sentencing has been set for February 8, 2017.
Co-defendant Ortega Mitchell pled guilty to the same charge in October and awaits sentencing. Co-defendant Darius Rose is awaiting trial.
The conspiracy charge carries a maximum penalty of life in prison. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the Federal Bureau of Investigation. Assistant United States Attorney Cristian M. Stevens is handling the case for the U.S. Attorney’s Office.
The charges set forth in an indictment are merely accusations, and defendant Rose is presumed innocent until and unless proven guilty.
Nine People Indicted on Fraud Charges Related to Telemarketing EnterpriseRead the Press Release
St. Louis, MO – Nine people living in the Phoenix, Arizona, area have been charged in federal court in a multi-count indictment arising from their participation in a fraudulent telemarketing enterprise. The enterprise generated in excess of $10,000,000 in sales from individuals across the United States and Canada and specifically targeted persons over the age of 55.
According to the indictment, which was unsealed earlier this week, beginning sometime prior to 2013 and continuing until July 2015, the defendants operated a telemarketing enterprise selling false and fictitious “business opportunities.” The Phoenix, Arizona, based telemarketing enterprise operated under multiple business names and utilized multiple business entities over the course of the scheme, including Smart Business Pros, LLC of Warson Woods, Missouri.
The charges include conspiracy to commit mail, wire and bank fraud; wire fraud; mail fraud and money laundering.
If convicted of wire fraud or mail fraud in connection with telemarketing, the defendants face up to 30 years in prison, a fine of $250,000 or both. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case is being investigated by the Office of the Arizona Attorney General, United States Postal Inspection Service, IRS Criminal Investigation and the Federal Bureau of Investigation. Assistant United States Attorney Charles Birmingham is handling the case for the U.S. Attorney's Office.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
St. Louis Area Woman Indicted on Charges of Theft by a Veteran's Affairs FiduciaryRead the Press Release
St. Louis, MO – Tamara Jones, St. Louis, Missouri, was charged with theft of government funds and misappropriation in connection with her service as a fiduciary representative of an area disabled veteran.
According to the indictment, Jones was enrolled as a financial fiduciary through the United States Department of Veterans Affairs. As such, she was eligible to handle the financial affairs of disabled veterans pursuant to an agreement with the VA. In September 2014, having been appointed fiduciary for a disabled veteran living in St. Louis County area, whose initials are A.W., Jones drained most of a $38,000 back pay award she found in his financial account.
Jones is also accused of failing to maintain records and file required reports and accountings of A.W.’s affairs. When confronted by VA auditors and investigators, Jones could not explain the situation and repeatedly failed to provide records, reports or A.W.’s funds despite repeated promises to do so.
The indictment was returned Wednesday, October 26. Jones is expected to appear in federal court later this week.
If convicted of theft of government funds, Jones faces up to 10 years in prison. If convicted of misappropriation by a fiduciary, she faces up to 5 years in prison. Both counts also carry the possibility of a fine of up to $250,000. Restitution to the victim is also mandatory. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
The case was investigated by the U.S. Department of Veterans Affairs-Office of the Inspector General. Assistant United States Attorney Tom Albus is handling the case for the U.S. Attorney’s Office.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
Mining Company Owners Sentenced on Fraud ChargesRead the Press Release
St. Louis, MO – Cristopher Cristea and David Corey Tolle were sentenced to 46 months in prison and ordered to pay restitution of $1,724,158; and three years probation and restitution of $526,750, respectively, on charges involving the solicitation of investors with promises of large returns from mining activities. Instead, the money was used to pay personal expenses and repay earlier investors. Tolle was sentenced today. Cristea was sentenced last week.
According to court documents, Cristea and Tolle formed Cristol Enterprises, LLC and Charis Minerals, Inc. They solicited investors for Cristol Enterprises, LLC and Charis Minerals, Inc., which purported to be in the business of exploring for and extracting valuable minerals, such as gold, silver, copper, lead and zinc, through mining operations in the western United States, including Arizona and Oregon, and in Western Africa. The investors were told that the money would be used to purchase property and equipment and pay for administration and other expenses involved in the exploration. They were promised large returns on their investments, often over a short period of time. Instead, a substantial majority of the money was used for personal expenditures and unrelated business expenses. In one instance, Cristea used funds to provide student loans to beauty academy students, and in another instance, funds were used to repay an earlier investor.
In December 2014, after previously having been arrested on this indictment, Cristopher Cristea applied for a $1 million line of credit at a bank. In the application, he falsely stated that he was not a defendant in any suit or legal action. Additionally, he falsely stated that he had $295,000 cash in checking accounts and had securities – stocks/bonds/mutual funds – in the amount of $13,000,000.
David Corey Tolle, O’Fallon, MO, pled guilty earlier this year to one felony count of wire fraud. Cristopher Cristea, St. Charles, MO, pled guilty earlier this year to one felony count of conspiracy, four felony counts of wire fraud, one felony count of money laundering and one felony count of making a false statement to a financial institution. Both defendants appeared before United States District Judge Carol E. Jackson.
This case was investigated by the Federal Bureau of Investigation. Assistant United States Attorney Steven Muchnick is handling the case for the U.S. Attorney’s Office.
Illinois Man Sentenced on Fraud and Money Laundering ChargesRead the Press Release
St. Louis, MO – Adam Bernaix, Edwardsville, Illinois, was sentenced to 37 months imprisonment on a fraud and money laundering scheme involving false invoices submitted to his employer on behalf of a shell company he created.
According to his plea agreement, Bernaix earned approximately $350,000 through Trident Management Solutions, a company he created solely to bill companies doing business with his employer. Bernaix submitted invoices for "services rendered" to companies doing business with his employer, Albert Arno, an HVAC contractor in the City of St. Louis. Bernaix, as a project manager for Albert Arno, was able to mark up the invoices of Trident’s clients to Albert Arno so that his employer provided the extra money needed for Trident’s clients to pay their Trident bills.
Bernaix employed his father-in-law at one point to perform occasional jobs, but even after Trident’s sole employee left the company and Trident did absolutely nothing for its clients, Bernaix still sent Trident clients bills and marked up the client’s Albert Arno bills sufficiently to keep the money flowing to Trident.
Bernaix pled guilty in July to two felony counts of mail fraud and two felony counts of money laundering. He appeared today for sentencing before United States District Judge Henry Autrey. In addition to his term of imprisonment, Bernaix was ordered to pay $427,713 in restitution to the victim of his crime.
The case was investigated by the Federal Bureau of Investigation, U.S. Postal Inspection Service and IRS Criminal Investigation. Assistant United States Attorney Tom Albus handled the case for the U.S. Attorney’s Office.
California Man Sentenced on Federal Conspiracy Charges for Distributing Drugs via a Commercial Air CarrierRead the Press Release
St. Louis, MO – Francis Frost, Sante Fe Springs, CA, was sentenced to 10 years in prison on charges of conspiring to import and distribute methamphetamine and cocaine into the St. Louis area via the commercial airlines, and for conspiring to violate airport security requirements.
Two co-defendants, Poe Purcell and Chalamar Schultz Tuipelehake, have pled guilty to related charges and await sentencing later this year.
According to court documents, Purcell began working as an American Airlines Cargo Fleet Service Clerk at Los Angeles International Airport in 2001. During the course of the conspiracy, including the time period between February and May 2015, Tuipelehake arranged for California drug traffickers to transport illegal controlled substances from Los Angeles, California, on commercial airliners using Purcell’s position with the airlines to avoid detection and facilitate the transport. Frost’s role involved retrieving the suitcases containing the drugs and distributing the drugs.
This case was investigated by the Drug Enforcement Administration in St. Louis and Orange County, California, and the Federal Bureau of Investigation in St. Louis, Los Angeles and LAX Airport.
Three Franklin County Residents Plead Guilty to Identify Theft ChargesRead the Press Release
St. Louis, MO – Three Franklin County, Missouri, residents have entered guilty pleas before United States District Judge John A. Ross involving their participation in a conspiracy to commit identity theft and access device fraud in the Eastern District of Missouri.
John Dean Townsend, Pacific, MO, pled guilty today to one felony count of conspiracy to commit identity theft and access device fraud. Sentencing has been set for February 1, 2017.
Jessica L. Franklin, Beaufort, MO, pled guilty October 3 to one felony count of conspiracy to commit identity theft and access device fraud and one felony count of aggravated identity theft. Franklin is scheduled for sentencing on January 10, 2017.
Jesse Ray Chitwood, St. Clair, MO, pled guilty September 28 to one felony count of conspiracy to commit identity theft and access device fraud. Chitwood is scheduled for sentencing on January 4, 2017.
According to court documents, Townsend stole the personal identification information of his customers while he was employed at an automotive dealership located in St. Louis County. He sold the information to Franklin. Franklin used the stolen identification information to manufacture fraudulent Missouri Department of Revenue temporary driver’s licenses, which Franklin and Chitwood used to open lines of credit and purchase merchandise at various retailers throughout the Eastern District of Missouri.
Conspiracy to commit identity theft and access device fraud carries a maximum penalty of five years in prison and/or fines up to $250,000. Aggravated identity theft carries a mandatory two-year term of imprisonment that must run consecutive to any other term of imprisonment. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the Franklin County Sheriff’s Office; the Washington, Missouri Police Department; the Ballwin Police Department and the Kirkwood Police Department. Assistant United States Attorney Jennifer Roy is handling the case for the U.S. Attorney’s Office.
St. Louis Man Indicted on Fraud ChargesRead the Press Release
St. Louis, MO – Syed Tariq Ali, St. Louis, Missouri, was arrested this morning on a two-count indictment alleging false statements with respect to federal housing program and bank fraud.
According to the indictment, Ali accepted illegal payments outside of a HUD lease during 2013 and 2014 and granted his tenant an interest in the rental property, contrary to his landlord certifications. Ali is also accused of falsifying endorsements on checks intended for needy members of his mosque between 2008 and 2010.
If convicted, Ali faces up to five years in prison on the HUD false statement charge, a fine of $250,000 or both. Ali also faces up to 30 years in prison on the bank fraud charge, a fine of up to $1,000,000 or both. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges. The government will also seek restitution to all victims.
The case was investigated by the U.S. Department of HUD-Office of the Inspector General and the Federal Bureau of Investigation. Assistant United States Attorney Tom Albus is handling the case for the U.S. Attorney’s Office.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.Washington State Man Sentenced on Fraud ChargesRead the Press Release
St. Louis, MO – Haben Sebhatu, Seattle, Washington, was sentenced to 63 months in federal prison for participating in two stolen identity credit card fraud rings that were disrupted in St. Louis.
Sebhatu’s conduct included credit card fraud activities in Missouri, Washington, Indiana and Arkansas. Sebhatu was arrested by the Ladue Police Department after a traffic stop on March 25, 2016, which revealed numerous counterfeit credit cards and a card encoding machine in his vehicle.
Sebhatu pled guilty in July to one felony count of credit card fraud, one count of possessing device making equipment and nine counts of aggravated identity theft. He appeared today for sentencing before Judge Audrey G. Fleissig.
The case was investigated by the Ladue (Missouri) Police Department, the U.S. Secret Service and the Pierce County (Washington) Prosecuting Attorney’s Office. Assistant United States Attorney Tom Albus handled the case for the U.S. Attorney’s Office.
Union, Missouri, Man Charged with Impersonating a Federal AgentRead the Press Release
St. Louis, MO – Timothy Rosselli, aka Timothy Rossell, aka Austyn Gardner, aka Austyn Labella, Union, Missouri, was arrested today on a federal arrest warrant charging him with impersonating a federal agent.
According to the criminal complaint filed in United States District Court yesterday, Rosselli had been living with a girlfriend in the Union, Missouri, area and holding himself out as a Deputy United States Marshal named Austyn Gardner. When Rosselli left his Union residence suddenly on October 9, his girlfriend called the local police who, with the help of the U.S. Marshals Service, quickly determined Rosselli’s identification and other USMS paraphernalia where counterfeit and fraudulent.
The investigation soon identified a second girlfriend in Ft. Myers, Florida. This second girlfriend knew Rosselli as "Austyn Labella," a deputy United States Marshal for whom she had purchased two sports cars, including a white Lamborghini. This second girlfriend directed investigators to Effingham, Illinois, where Effingham police located him attempting to purchase a bus ticket. Rosselli had explained to the second girlfriend that the Lamborghini had blown a tire and he needed alternate transportation.
Rosselli appeared in court this morning in St. Louis. The government has sought Rosselli’s detention pending trial. Rosselli has numerous prior convictions for fraud and deceit and is wanted on parole violations in Missouri courts and in his native state of Pennsylvania. If convicted of impersonation of a federal officer, Rosselli faces up to three years imprisonment, a fine of up to $250,000 or both. Restitution to any victims of his deception will also be sought.
Rosselli is suspected of deceiving others into believing he was a federal officer. Anyone with information on Rosselli or any of his aliases is requested to contact the U.S. Marshals Service – Investigations Bureau at 314-539-2040.
This case was investigated by the United States Marshals Service with assistance from the Union (Missouri) Police Department and the Effingham (Illinois) Police Department. Assistant United States Attorney Tom Albus is handling the case for the U.S. Attorney’s Office.
As is always the case, charges set forth in a criminal complaint are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
Former Pine Lawn Lieutenant Sentenced on Federal ChargesRead the Press Release
St. Louis, MO –Former Pine Lawn Lieutenant Steven Blakeney was sentenced to 51 months in prison on criminal civil rights charges arising from his arrest in 2013 of a candidate for the office of Mayor of the City of Pine Lawn.
According to testimony presented at trial, on March 31, 2013, Blakeney, while a police officer with the City of Pine Lawn Police Department, conspired with others to cause the arrest of a mayoral candidate based on false allegations and without probable cause. Blakeney ordered another person to falsely report that the mayoral candidate had stolen a campaign poster from a local business and then arranged for the candidate to be arrested.
Blakeney was convicted in January of one felony count of conspiracy against rights; one count of deprivation of rights under color of law and one count of falsification of records. He appeared today for sentencing before United States District Judge Stephen N. Limbaugh, Jr., who had the defendant remanded into the custody of United States Marshals.
The case was investigated by the Federal Bureau of Investigation. Assistant United States Attorney Reginald Harris handled the case for the U.S. Attorney’s Office.
St. Louis County Man Pleads Guilty to Fraud ChargesRead the Press Release
St. Louis, MO – Charles Hicks, Fenton, Missouri, pled guilty to a one-count mail fraud indictment this afternoon.
According to his plea agreement, Hicks devised a false invoice scheme to defraud two successive employers, RockTenn Company and MarChem Company, over the course of two and a half years. Hicks had authority to identify vendors and authorize purchases and used dummy companies to submit and receive payments for false invoices. In all, Hicks admitted to defrauding the two companies of $370,000.
Hicks appeared before U.S. District Judge Stephen N. Limbaugh, Jr. Sentencing has been set for January 4, 2017.
Hicks faces a maximum penalty of 20 years in prison and/or a fine of $250,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges. Restitution to the victims is also mandatory.
This case was investigated by the FBI and the U.S. Postal Inspection Service. Assistant United States Attorney Tom Albus is handling the case for the U.S. Attorney’s Office.
Owner of Tax Preparation Franchises in Illinois, Kansas and Missouri Convicted of Tax EvasionRead the Press Release
WASHINGTON – A federal jury sitting in St. Louis, Missouri, found the local owner of tax return preparation businesses guilty of two counts of tax evasion, announced Principal Deputy Assistant Attorney General Caroline D. Ciraolo, head of the Justice Department’s Tax Division.
"While Semere Tsehaye was operating tax return preparation franchises in three states, he was generating false financial summaries and filing fraudulent returns to evade paying his own taxes," said Principal Deputy Assistant Attorney General Ciraolo. "No one is above the law, and the department will continue to prosecute those who seek to violate our nation’s tax laws."
According to the evidence at trial, Semere Tsehaye, was the owner and operator of at least 20 Instant Tax Service (ITS) franchise locations operating in and around East Saint Louis, Illinois; Kansas City, Kansas; and Kansas City and St. Louis, Missouri, from 2005 to 2011. ITS was a brand name of ITS Financial LLC, a nationwide tax preparation business headquartered in Dayton, Ohio. Tsehaye owned and operated his ITS franchise locations using two entities named A&S Tax Service LLC (A&S) and ERI Enterprises LLC (ERI).
The evidence at trial showed that during the years 2010 and 2011, Tsehaye generated fraudulent financial summaries that understated the gross receipts generated by A&S and ERI and provided them to his tax return preparer. The evidence also showed Tsehaye’s tax return preparer used these financial summaries to prepare Tsehaye’s individual income tax returns, which Tsehaye then filed with the Internal Revenue Service (IRS). These tax returns were false in that they underreported A&S and ERI’s gross receipts by a total of approximately $547,000 in 2010 and $1.03 million in 2011, causing a tax loss of more than $580,000.
"Mr. Tsehaye’s attempt to evade his taxes by creating false financial summaries to conceal over $1.5 million of income and by filing false tax returns is a theft from the American public," said Special Agent in Charge Karl Stiften of IRS-Criminal Investigation. "We all pay when others swindle the government."
In 2013, a Kansas City, Kansas, federal court permanently enjoined Tsehaye and A&S from further operating a tax preparation business or preparing federal tax returns.
Sentencing is scheduled for January 4, 2017. Tsehaye faces a statutory maximum sentence of five years in prison for each count of tax evasion, as well as a period of supervised release and monetary penalties.
Principal Deputy Assistant Attorney General Ciraolo commended special agents of IRS-Criminal Investigation, who conducted the investigation, and Senior Litigation Counsel Corey Smith and Trial Attorney Mark McDonald of the Tax Division, who are prosecuting the case. Principal Deputy Assistant Attorney General Ciraolo also thanked the U.S. Attorney’s Office for the Eastern District of Missouri for their assistance.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
St. Louis County Man Sentenced to 14 Years on Child Enticement ChargesRead the Press Release
St. Louis, MO – Ian Mackie was sentenced to 14 years in prison on multiple child enticement charges.
According to court documents filed at the time of the plea, Mackie used several social media sites, email and text messages to communicate and entice two males, 13 and 15 years old, respectively, to engage in sex acts with him.
Mackie, Ballwin, MO, pled guilty in June to one felony count each of attempted receipt of child pornography; online enticement of a minor; receipt of child pornography and attempted online enticement of a minor. He appeared today for sentencing before United States District Judge Rodney W. Sippel.
This case was investigated by the St. Louis County Police Department, the Missouri Internet Crimes Against Children Task Force and the Federal Bureau of Investigation. Assistant United States Attorney Colleen Lang handled the case for the U.S. Attorney's Office.
California Woman Sentenced on Fraud ChargesRead the Press Release
St. Louis, MO – Latricia Newell was sentenced to 48 months in prison involving her use of counterfeit credit cards to purchase gift cards in the St. Louis area.
According to court documents, on January 31, 2016, a Chesterfield, Missouri, police officer received a call that Latricia Newell had used a credit card embossed in her name to purchase gift cards. However, when the receipt was printed, it revealed that the account number used to make the purchase had been issued to an individual other than Newell. When the officer approached her vehicle, he noticed 20 cards had fallen out of her purse. By searching her car, the officer found 51 gift cards that had been fraudulently purchased, and 64 credit/debit cards embossed in Newell’s name. The 64 credit/debit cards were similar to the card which triggered the investigation in that the magnetic strips on the back of the cards were encoded with the account numbers of others. Newell advised the arresting officers that she had traveled to the St. Louis metropolitan area from California with the cards in her possession.
After her arrest, law enforcement officers discovered her use of re-encoded credit cards to purchase gift cards and other merchandise in the Missouri cities of St. John, Brentwood, Clayton, and Hazelwood. When the magnetic strips found on the back of the cards in defendant’s possession were scanned by law enforcement officers, the officers discovered that the account numbers had been issued by financial institutions to more than 60 individuals. Further investigation by the United States Secret Service revealed that on February 21, 2014, airport authorities in Austin, Texas, discovered more than 323 gift cards and 39 re-encoded cards during a routine screening of baggage that was to be flown from Austin, Texas, to Los Angeles, California. Of the 39 counterfeit cards discovered, 38 were embossed in Newell’s name. Newell was on the manifest for the flight.
Newell, Harbor City, CA, pled guilty in June to one felony count of possession of 15 or more counterfeit credit cards, two felony counts of aggravated identity theft and one count of use of unauthorized access devices. She appeared today for sentencing before United States District Judge Catherine D. Perry.
The case was investigated by the Missouri police departments of Chesterfield, St. John, Brentwood, Clayton and Hazelwood and the United States Secret Service. Assistant United States Attorney Tracy Berry handled the case for the U.S. Attorney’s Office.
Ballwin Area Man Pleads Guilty to Fraud ChargesRead the Press Release
St. Louis, MO – Darrin Landes pled guilty to wire fraud charges involving his scheme to sell sporting event tickets, but not delivering them to the purchasers after they sent payment to him.
According to court documents, from September 2015 to July 2016, Landes offered to sell tickets to sporting and entertainment events including the 2016 Kentucky Derby, the 2016 Masters golf tournament in Augusta, Georgia, and St. Louis Cardinals games. On some occasions, he offered to sell accommodations at hotels, resorts and/or homes. He frequently did not have tickets to sell to these prospective purchasers, and when he did have one ticket to an event, he attempted to sell the same ticket to someone else.
Landes and the prospective purchasers discussed the price for these tickets through face-to-face conversations, emails, texts and/or telephone conversations. The purchasers agreed to pay Landes and upon receipt of payment would send them the purchased items. Landes instructed the purchasers to send payment to him by wire transaction to either his PayPal account, one of his alleged business acquaintance’s PayPal accounts or, on some occasions, he met with the purchaser and obtained the money for the items he was selling. After the purchasers sent money to Landes and they did not receive the items that they paid for, and they attempted to contact Landes, he offered some excuse for the delay in sending the purchased item.
Landes , Ballwin, MO, pled guilty to one felony count of wire fraud before United States District Judge Rodney Sippel. Sentencing has been set for December 16, 2016.
Wire fraud carries a maximum penalty of 20 years in prison and or fines up to $250,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the Federal Bureau of Investigation and the Kirkwood Police Department. Assistant United States Attorney Anthony Franks is handling the case for the U.S. Attorney's Office.
Former President of St. Louis Law Enforcement Officer Association Pleads Guilty to Fraud ChargesRead the Press Release
St. Louis, MO – Darren Randal Wilson pled guilty to nine counts of wire fraud involving his misappropriation of over $80,000 from the Ethical Society of Police, an association of black St. Louis police officers.
According to court documents, Wilson was president of the Ethical Society of Police (ESOP) in 2013 and 2014. As president of ESOP, Wilson had access to funds in the ESOP bank account, which consisted primarily of the monthly dues contributed by the police officer members of ESOP.
Between July 2013 and December 2014, Wilson engaged in a fraud scheme to misappropriate money from the ESOP bank account and to use the money for his own purposes, including funding his business promoting comedy shows featuring nationally known comedians at local night clubs. To further the fraud scheme, Wilson transmitted some of the misappropriated money by Fed Wire, PayPal and Western Union wire transfers. To conceal his fraudulent activity, Wilson presented false information to ESOP officers and members. In April 2014, Wilson was indicted on nine felony counts of wire fraud associated with the fraud scheme.
Wilson, St. Louis, Missouri, appeared before United States District Judge Henry Edward Autrey and pled guilty to all nine counts of wire fraud. As part of the guilty plea, Wilson acknowledged that he abused his position of public and private trust. He agreed to a money judgment against him of $80,934, to account for the losses to ESOP associated with the fraud scheme. He also agreed to surrender his law enforcement certification and to no longer work or seek employment as a law enforcement officer. Sentencing has been set for December 12, 2016.
Each count carries a maximum penalty of 20 years in prison and/or a fine up to $250,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges substantially lower than the statutory maximum.
This case was investigated by the Federal Bureau of Investigation and the St. Louis Metropolitan Police Department. Assistant United States Attorney Cristian M. Stevens is handling the case for the U.S. Attorney’s Office.
Kirkwood Area Financial Advisor Convicted of Fraud ChargesRead the Press Release
St. Louis, MO – Robert S. Beyer, II, was convicted of wire fraud and money laundering charges involving a scheme to lure investors into investing money with Heroic Life Assurance Company, LLC, a fraudulent enterprise that Beyer created in order to steal money from his clients.
According to testimony presented at trial, starting in 2011, Beyer, who had previously sold life insurance annuities and other investment products to the victims, solicited his clients to place their money with Heroic Life Assurance Company, which Beyer assured them was a safe investment. Some victims were promised returns between 8 and 18 percent per year, and others were told that they would be able to withdraw their money from the investment at any time. What Beyer did not tell his victims was that he had no intention of keeping their money safe, but instead intended to spend it to support his own lifestyle. Evidence at trial established that Beyer spent his clients’ money on personal bills such as car repairs, child support and dating services. Beyer also used money from his victims to pay the expenses of Heroic Life Assurance Foundation, a non-profit entity that Beyer planned to use to recruit new victims by offering businesspeople free entrepreneurship classes. To conceal the true source of the Foundation’s funding, Beyer created a fictional persona named Jesus Cristobal, a wealthy South American financier who was supposedly bankrolling the Foundation’s operations. In total, Beyer’s victims lost nearly $300,000.
Beyer, Kirkwood, MO, was convicted of one felony count of wire fraud and one felony count of money laundering. The three-day trial was held before United States District Judge Ronnie L. White. Sentencing has been set for December 7, 2016.
Wire fraud carries a maximum penalty of 20 years in prison and/or fines up to $250,000. Each of the money laundering charges carry a maximum penalty of 10 years and/or $250,000. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the Kirksville Office of the Federal Bureau of Investigation. Assistant United States Attorneys Richard Finneran and Amanda Wick are handling the case for the U.S. Attorney’s Office.
Area Man Indicted on Federal Fraud ChargesRead the Press Release
St. Louis, MO – Kenneth Edwards, St. Louis City, was indicted on wire fraud and identity theft charges involving a scheme to use counterfeit checks to make purchases at local Walmart and Sam’s stores.
According to the indictment, from August to December 2015, Edwards used a stolen account number and routing number to purchase valuable goods from retail stores using forged or counterfeit checks. Edwards allegedly obtained a checkbook, identification and other information after it was stolen from a victim on August 2015.
Edwards was indicted by a federal grand jury August 17th on three felony counts of wire fraud and one felony count of aggravated identity theft. He appeared in federal court Thursday afternoon, September 8th.
If convicted, wire fraud carries a maximum penalty of 20 years in prison and/or fines up to $250,000. Aggravated identity theft carries two years in prison and/or fines up to $250,000. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the Maplewood Police Department. Assistant United States Attorney Tom Albus is handling the case for the U.S. Attorney’s Office.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
St. Louis County Man Pleads Guilty to Fraud ChargesRead the Press Release
St. Louis, MO – Raja Chellappa, of St. Louis County, pled guilty to two counts of wire fraud in connection with his solicitation and acceptance of a fictitious “buyer’s premium” as part of a 2015 commercial real estate transaction.
According to his plea agreement, Chellappa falsely told a buyer of a St. Charles County motel property that the seller had demanded a $50,000 “buyer’s premium” when no such demand had been made. The buyer agreed to pay the extra $50,000, which Chellappa directed the buyer to wire into his personal bank account. The $50,000 was not disclosed to the seller or to Chellappa’s real estate company during the escrow and closing process.
Chellappa pled guilty before Judge Catherine D. Perry, who set sentencing for December 14, 2016.
Each count of wire fraud carries a maximum penalty of 20 years imprisonment and/or a fine of $250,000. Restitution is also mandatory. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
The case was investigated by the St. Louis Division of the FBI and the United States Postal Inspection Service. Assistant United States Attorney Tom Albus is handling the case for the U.S. Attorney’s Office.
Lewis County Man Sentenced on Federal Child Pornography ChargesRead the Press Release
St. Louis, MO - Michael Prisner, Ewing, Missouri, was sentenced to 42 months in prison on charges involving his possession of child pornography between April and June 2015.
Prisner pled guilty in June to two felony counts of possession of child pornography. He appeared today in St. Louis for sentencing before United States District Judge Catherine D. Perry.
This case was investigated by the Kirksville Office of the Federal Bureau of Investigation, the Kirksville ICAC (Internet Crimes Against Children), Kirksville Police Department and the Lewis County Sheriff's Office. Assistant United States Attorney Coleen Lang handled the case for the U.S. Attorney's Office.
Lewis County Couple Plead Guilty to Social Security Fraud ChargesRead the Press Release
St. Louis, MO – Michael Allen Clow, Maywood, MO, pled guilty to multiple charges involving his concealment of his employment while collecting disability payments. From 2001 through 2012, Clow received approximately $273,634 in Social Security Administration (SSA) disability insurance benefits as a result of this illegal scheme.
According to court documents, in 1999, Michael Allen Clow submitted an application for disability insurance benefits with the Social Security Administration (SSA) stating that he was unable to work due to chronic low back pain. In his application he agreed to notify the SSA if his medical condition improved so that he could work or if he went to work as an employee or a self-employed person. He began receiving benefits that year. During 2001 Clow began working with his father building homes. In 2002, he and his wife, Laura Clow, went into business together and started a construction business called C & M Construction. From 2002 to 2012 Clow worked for C & M Construction providing manual labor. During this time he filed reports to SSA claiming he was still unable to work.
While Michael Clow received payments from SSA, his wife, Laura Clow, assisted in the fraud by placing the business in her name, and falsely claimed that he was disabled and unable to bend over, do house and yard work and general daily activities.
Michael Clow pled guilty to one count of conspiracy to commit theft of government property, one count of concealment and two counts of making false statements to the Social Security Administration. He appeared before United States District Judge Catherine D. Perry. Sentencing has been set for December 9, 2016.
Laura Clow pled guilty to one count of conspiracy to commit theft of government property before United States Magistrate Judge John Bodenhausen. Her sentencing has also been set for December 9th.
The conspiracy charge carries a maximum penalty of one year in prison and/or fines up to $100,000. Each of the other charges carries a maximum of five years in prison and/or fines up to $250,000. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the Social Security Administration-Office of Inspector General. Assistant United States Attorney Anthony Franks is handling the case for the U.S. Attorney’s Office.
Area Tax Preparer Sentenced on Tax ChargesRead the Press Release
St. Louis, MO – Ricker Brooks was sentenced to 18 months in prison and ordered to pay restitution of $99,273 on charges involving his preparation of false tax returns. Brooks overstated business expenses of a client for the tax years 2009 and 2010. Brooks owns Brooks Accounting Service, providing accounting and tax preparation services. Zondra Jones owns Alliance In-Home Care Services, which provides home health care services to individuals.
According to court documents, after Jones reviewed the tax returns that Brooks prepared for her, she thought that the contract labor expense for her business was overstated. Although there was discussion between the two of them regarding the overstatement, Jones and Brooks agreed to file the tax returns with the overstatement. After the IRS began to investigate the returns, Brooks prepared false 1099 forms and check schedules which falsely represented payments made by Alliance In-Home Care Services to contract employees. Jones provided these false documents to the IRS.
"Knowingly falsifying documents filed with the IRS is a crime,” said Karl Stiften, Special Agent in Charge of IRS Criminal Investigation. “We hope today's sentence sends the strong message that tampering with the integrity of our nation's tax system will result in jail time."
Brooks, St. Louis County, pled guilty in May to one felony count of conspiracy to defraud the U.S. and two felony counts of aiding and assisting in the preparation of a false income tax return. He appeared today for sentencing before United States District Judge Ronnie L. White. Brooks was taken into custody immediately following his sentencing.
Zondra Jones, Florissant, pled guilty last November to related charges. She was sentenced in May to probation for a term of three years and restitution of $99,273.
This case was investigated by IRS Criminal Investigation. Assistant United States Attorney Steven Muchnick handled the case for the U.S. Attorney's Office.
Ellisville, Missouri Woman Indicted on Bankruptcy Fraud ChargesRead the Press Release
St. Louis, MO – Julie A. Fish was indicted on charges involving a bankruptcy scheme and concealing assets.
According to the indictment, Fish filed for bankruptcy in February 2014. The indictment states that she understated the value of her home in Ellisville by listing the value as $145,000. The property sold for $289,900. Additionally, in her Schedule B, Personal Property declaration she understated or failed to list the value of clothing, furs and jewelry by several thousand dollars. Also, as part of her preparation for the bankruptcy filing, Fish delivered several items of valuable jewelry to a local jewelry store to be sold on consignment, which she failed to list on the Schedule B document.
Fish, Ellisville, MO, was indicted by a federal grand jury on July 27, on one felony count each of bankruptcy fraud, making false statements in bankruptcy and concealment of bankruptcy assets. She was arraigned in federal court this morning.
If convicted, each count of the indictment carries a maximum penalty of five years in prison and/or fines up to $250,000. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
New Madrid County Man Sentenced on Federal Charges Involving Farm Subsidy and Crop Insurance FraudRead the Press Release
Cape Girardeau, MO – Bobby David Lowrey was sentenced to 24 months in prison on multiple charges involving federal crop insurance fraud, theft of government property and wire fraud.
According to court documents, Bobby David Lowrey owned and operated farms and related businesses in Parma, New Madrid County, Missouri, including Bobby David Lowrey Farms, Lowrey and Lowrey, Inc. of Parma, Missouri, John Radin Farms and Kathy Ellsworth Farms.
Bobby David Lowrey placed farms in other people’s names in order to obtain federal farm subsidy payments that he was not entitled to receive under the Direct and Counter-Cyclical Payment Program. The investigation disclosed that John Radin, the alleged operator of Radin Farms, was employed by Bobby David Lowrey and not actively engaged in farming and did not have any financial interest in the farming operations. Lowery made false statements to the United States Department of Agriculture pertaining to the Federal Crop Insurance Corporation and Direct and Counter-Cyclical Payment Program.
From 2007 to 2012, Bobby David Lowrey obtained $240,367 in direct and counter-cyclical payments in the name of John Radin Farms. Additionally, $207,729 worth of Multiple Peril Crop Insurance Indemnities, premium subsidies and administrative subsidies were paid on behalf of John Radin Farms between 2008 and 2012.
The investigation also disclosed that between 2006 and 2011, Bobby David Lowrey transmitted by wire “Extended Work Search Waivers” to the Missouri Division of Employment Security, and reported that his employees were on a temporary layoff, when in reality they were still working and being paid. The transmissions made to the Missouri Division of Employment Security resulted in more than $60,000 worth of Unemployment Insurance benefits being paid to employees that they were not eligible to receive.
Bobby David Lowrey, Parma, MO, pled guilty in May to two felony counts of making false statements regarding crop insurance benefits, one felony count of theft of government property and one felony count of wire fraud. He appeared today in Cape Girardeau for sentencing before United States District Judge Stephen N. Limbaugh, Jr.
This case was investigated by the United States Department of Agriculture-Office of Inspector General-Investigations, Missouri State Highway Patrol-Rural Crimes Investigative Unit and United States Department of Labor-Office of Inspector General-Investigations. Assistant United States Attorney Anthony L. Franks handled the case for the U.S. Attorney’s Office.
Cape Girardeau County Man Sentenced on Federal Charges Involving Food Stamp FraudRead the Press Release
Cape Girardeau, MO – The co-owner of B & H Convenience was sentenced to twenty-one months imprisonment on charges of misusing the Supplemental Nutrition Assistance Program (SNAP), formerly known as the food stamp program. Patrick Buck admitted with his plea last May that he illegally redeemed up to $550,000 in SNAP benefits between January 2010 and March 2014. Buck was ordered to pay $550,000 in restitution to the United States Department of Agriculture (USDA), which administers this program nationwide.
According to court documents, the Missouri Department of Social Services, Family Support Division (FSD) issues Electronic Benefits Transfer Cards (EBT), for the SNAP. Authorized grocery retailers can only accept and redeem SNAP benefits for the sale of eligible food items. They are not permitted to exchange or redeem SNAP benefits for cash or other ineligible items such as household goods, alcoholic beverages, tobacco products, cellular telephones or other non-food items, or on credit.
Patrick Buck, Cape Girardeau, MO, pled guilty in May to four felony counts of unauthorized use of SNAP benefits. He appeared today in Cape Girardeau for sentencing before United States District Judge Ronnie L. White.
This case was investigated by the United States Department of Agriculture, Office of Inspector General-Investigations, Sikeston Department of Public Safety. Assistant United States Attorney Anthony L. Franks handled the case for the U.S. Attorney’s Office.
Lincoln County Man Sentenced for Trafficking Synthetic DrugsRead the Press Release
St. Louis, MO – Richard Gross, Winfield, MO, was sentenced today to 150 months in prison on multiple counts involving the trafficking of synthetic drugs. Additionally, as part of these convictions, the defendants have agreed to the forfeiture of assets and property totaling in excess of $6.5 million.
According to court documents, Richard Gross and co-defendant Paul Berra manufactured synthetic cannabinoids known on the street as “K 2” and “Incense” and synthetic cathinones known on the street as “Bath Salts.” These products were sold to stores in a number of states. However, their largest customer was Gross’ mother, co-defendant Pam Tabatt, who was the largest retailer of synthetic drugs in the Eastern District of Missouri. She sold the synthetic drugs through South 94 Bait and Tackle in St. Charles County and Smoke Sensations, Nights of Rave in St. Louis County.
Gross, Winfield, MO, pled guilty in April to one felony count each of conspiracy to distribute and possess with the intent to distribute controlled substance analogues intended for human consumption, conspiracy to fraudulently receive and distribute misbranded products in interstate commerce, conspiracy to import controlled substance analogues into the United States and conspiracy to receive, sell and facilitate transportation of smuggled goods. He appeared today for sentencing before United States District Judge John A. Ross.
Pamela Tabatt, St. Peters, MO, pled guilty to related charges in March. She was sentenced July 20 to 150 months in prison and ordered to pay a $25,000 fine. Paul Berra, Jr., Warrenton, MO, entered his plea in January and was sentenced in May to 34 months in prison.
This case was investigated by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), Internal Revenue Service Criminal Investigation, Drug Enforcement Administration, the Postal Inspection Service and the Federal Bureau of Investigation. Additional assistance was received from the St. Louis County Police Department, St. Charles County Sheriff’s Department, MO Lake Area Narcotics Enforcement Group, Metropolitan Enforcement Group for Southern IL, Southern Illinois Drug Task Force, the Illinois Attorney General’s Office, as well as the prosecuting attorney's offices in St. Louis County, MO; St. Charles County, MO; Madison County, IL and St. Clair County, IL. Assistant United States Attorneys James Delworth and Erin Granger handled the case for the U.S. Attorney's Office.
O'Fallon, Missouri Couple Indicted on Bankruptcy Fraud ChargesRead the Press Release
St. Louis, MO – David and Mung Nguyen were indicted on charges involving a bankruptcy scheme and concealing assets.
According to the indictment, David and Mung Nguyen filed for bankruptcy in March 2015. In preparation for the bankruptcy filing, they purchased valuable household goods and furnishings, apparel, handbags and jewelry, and made over $25,000 in credit card cash withdrawals. The indictment states that they failed to list at least $100,000 of these items as assets on the bankruptcy petition. Additionally, after filing the petition for bankruptcy, David Nguyen filed a claim with AAA auto insurance company for damage caused to his 2011 Mercedes, and received payment for the damage. He failed to notify the trustee that he received the payment, and he did not use the money to have the car repaired.
David Nguyen and Mung Nguyen, both of O’Fallon, MO, were indicted by a federal grand jury on July 27 on one felony count each of bankruptcy fraud, making false statements in bankruptcy and concealment of bankruptcy assets. They are expected to appear in federal court this afternoon.
If convicted, each count of the indictment carries a maximum penalty of five years in prison and/or fines up to $250,000. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
Three Area People Indicted on Federal Fraud Charges Involving Check-Kiting SchemeRead the Press Release
St. Louis, MO – Three area people, including an inmate at the Jennings Correctional Facility, were indicted on multiple fraud counts involving a conspiracy to commit various fraudulent schemes, including check-kiting, which they term as “piggybacking.” Check-kiting occurs when an individual takes advantage of the small window of time between when checks are deposited into an account and the financial institution upon which the checks are drawn provides notice to the depositing institution that the check will not be honored.
According to the indictment, the purpose of the conspiracy was to open bank accounts at Bank of America and U.S. Bank and use an existing account at Regions Bank to deposit worthless checks. They disbursed from the artificially inflated accounts through cash and ATM withdrawals, writing checks and making debit card purchases before the worthless checks were determined to be invalid by Bank of America, U.S. Bank and Regions Bank. Taion Brown and Pierre Watson recruited Justice Carter and other individuals to open bank accounts and provide checks from existing accounts in exchange for payment for their participation in the scheme to defraud Bank of America, U.S. Bank and Regions Bank.
Taion Brown, St. Louis, MO, and Pierre Watson, St. Louis, MO, were indicted by a federal grand jury on August 3 on one felony count each of conspiracy to commit bank and wire fraud, three felony counts of bank fraud and one felony count of aggravated identity theft. Justice Carter, St. Louis, MO, was indicted on one felony count of conspiracy to commit bank and wire fraud and one felony count of bank fraud.
If convicted, each count of conspiracy to commit bank and wire fraud and bank fraud carries a maximum penalty of 30 years in prison and/or fines up to $1 million. Aggravated identity theft is a mandatory two years in prison, consecutive to any other term of imprisonment. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the United States Secret Service, the Federal Bureau of Investigation and St. Louis County Police Department. Assistant United States Attorney Tracy Berry is handling the case for the U.S. Attorney’s Office.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
Local Man Indicted on Federal Fraud ChargesRead the Press Release
St. Louis, MO – Eddie Lee Regans was indicted on multiple fraud charges after using clients' personal information to obtain credit to be used for his personal use, racking up charges of approximately $89,000.
On January 22, 2010, Eddie Lee Regans pled guilty to the felony offenses of aggravated identity theft and bank fraud stemming from his use of the names of others in order to open business accounts at various financial institutions throughout the St. Louis metropolitan area. Upon being released from an 84-month term of incarceration, Regans was ordered to submit to the supervision of the United States Probation Office for an additional five years. One of the terms of supervision prevented Regans from creating, managing or operating any business entity without the written approval of the probation office.
The indictment alleges that between August 2015 and July 2016, using the name Eddie Lee, Regans advertised himself as a contractor by distributing flyers to customers at various home improvement stores and other retail establishments in the St. Louis metropolitan area. Regans also established an internet website and Yellow Pages entry in which he claimed to provide home repair and general contractor services through a company called All Rehab & Repair. He also falsely claimed to have been accredited by the Better Business Bureau. In response to complaints by consumers and its own investigation, the Better Business Bureau issued an alert warning consumers from doing business with Regans and his companies. In addition to All Rehab & Repair, Regans used the following names when advertising his business: Reasonable Quality Work; Repair and Rehab; All Rehab Repairs and Affordable Quality Works. Regans obtained prospective customers’ identifying information by promising that his company would finance their home repairs, and believing his representations, several customers provided their names, dates of birth, social security numbers and addresses. As Regans did not operate any company through which he could provide financing, he used the identifying information to open, and attempt to open, credit accounts at the home improvement stores Menards and Lowes. Rather than use the credit accounts for the benefits of the homeowners, Regans utilized the accounts to purchase items for his benefit.
Eddie Regans, St. Louis, MO, was indicted by a federal grand jury on Wednesday, August 3, on two felony counts of fraudulent use of access devices, one felony count of mail fraud and six felony counts of aggravated identity theft.
If convicted, fraudulent use of access devices carries a maximum penalty of 10 years in prison and/or fines up to $250,000; mail fraud carries a maximum penalty of 20 years in prison and/or fines up to $250,000 and aggravated identity theft is a mandatory two years in prison consecutive to any other term of imprisonment. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the United States Postal Inspection Service. Assistant United States Attorney Tracy Berry is handling the case for the U.S. Attorney’s Office.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
Jefferson County Man Pleads Guilty to Child Pornography ChargesRead the Press Release
St. Louis, MO – James Bowen, Pevely, MO, pled guilty to charges involving his production, receipt and possession of child pornography between January 1, 2014, and February 29, 2016.
According to court documents, Bowen had illegal sexual contact with a minor under the age of twelve in 2014, and took approximately 30 to 40 photographs of her in various stages of undress. During the investigation of Bowen’s computers, law enforcement found over 5,288 images of child pornography and 810 videos of child pornography. Many of these images and videos of child pornography were of minor children under the age of twelve.
Bowen pled guilty to one felony count each of production, receipt and possession of child pornography before United States District Judge Ronnie L. White, in St. Louis. Sentencing has been set for October 26, 2016.
Production of child pornography carries a penalty range of 15-30 years in prison, receipt of child pornography carries a range of 5-20 years in prison and possession carries a maximum penalty of 20 years in prison. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated the Federal Bureau of Investigation, the St. Louis County Police Internet Crimes Against Children Task Force and the Pevely Police Department. Assistant United States Attorney Colleen Lang is handling the case for the U.S. Attorney's Office.
St. Louis Man Pleads Guilty to Stealing from Norfolk Southern Railway TrainsRead the Press Release
St. Louis, MO – Ronald Bonner, St. Louis, MO, pled guilty to stealing goods from Norfolk Southern Railway trains as they passed through the railroad’s St. Louis terminal. Bonner admitted to two counts of theft from an interstate shipment involving two separate incidents occurring on October 14, 2015, and February 5, 2016, during which Bonner boarded trains, broke into containers and stole valuable merchandise to be resold. He entered his plea before United States District Judge John A. Ross.
Bonner now faces up to three years imprisonment and a fine of up to $250,000 per count. Restitution to the victim is also mandatory.
The case was investigated by the Norfolk Southern Railroad Police. Assistant United States Attorney Tom Albus is handling the case for the U.S. Attorney’s Office.
Illinois Man Pleads Guilty to Fraud and Money Laundering ChargesRead the Press Release
St. Louis, MO – Adam Bernaix, Edwardsville, Illinois, admitted to a fraud and money laundering scheme involving false invoices submitted to his employer on behalf of a shell company he created.
According to his plea agreement, Bernaix earned approximately $350,000 through Trident Management Solutions, a company he created solely to bill companies doing business with his employer. Bernaix submitted invoices for "services rendered" to companies doing business with his employer, Albert Arno, an HVAC contractor in the City of St. Louis. Bernaix, as a project manager for Albert Arno, was able to mark up the invoices of Trident’s clients to Albert Arno so that his employer provided the extra money needed for Trident’s clients to pay their Trident bills.
Bernaix employed his father-in-law at one point to perform occasional jobs, but even after Trident’s sole employee left the company, and Trident did absolutely nothing for its clients, Bernaix still sent Trident clients bills and marked up the clients' Albert Arno bills sufficiently to keep the money flowing to Trident.
Bernaix pled guilty to felony counts of mail fraud and two felony counts of money laundering before United States District Judge Henry Autrey. Sentencing has been set for October 25, 2016.
Bernaix faces up to 20 years imprisonment on each of two mail fraud counts, up to 10 years imprisonment on each of two money laundering counts and/or fines up to $250,000. Restitution for the victims will be sought pursuant to the Mandatory Victims Restitution Act.
The case was investigated by the Federal Bureau of Investigation, U.S. Postal Inspection Service and IRS Criminal Investigation. Assistant United States Attorney Tom Albus is handling the case for the U.S. Attorney’s Office.
Warren County Man Pleads Guilty to Transporting a Minor Across State LinesRead the Press Release
St. Louis, MO – Christopher Schroeder pled guilty to transporting a minor across state lines to engage in criminal sexual activity.
According to court documents, in late October 2015 or early November 2015, Schroeder met fifteen-year-old female A.B. through KIK, an internet chat forum. A.B. was living in Brooklyn, Ohio, at the time.
On or about November 8, 2015, Schroeder drove to Brooklyn, Ohio, and picked up fifteen-year-old A.B. at an agreed upon location.
Schroeder drove them to his residence in Marthasville. Sometime after arriving at his home, he engaged in sexual intercourse with A.B. Two of these sex acts were recorded by Schroeder without the victim’s knowledge.
Schroeder, Marthasville, MO, pled guilty to one felony count of transportation of a minor with intent to engage in criminal sexual activity before United States District Judge Henry Autrey. Sentencing has been set for October 19, 2016.
This charge carries a penalty range of ten years to life in prison and/or fines up to $250,000, followed by supervised release for life. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the Federal Bureau of Investigation, the Brooklyn Police Department, St. Charles County Internet Crimes Against Children Task Force and the Warren County Sheriff’s Department. Assistant United States Attorney Colleen Lang is handling the case for the U.S. Attorney’s Office.
Local Man Pleads Guilty to Charges Involving an Armed Assault on Arch PropertyRead the Press Release
St. Louis, MO – Kilwa Jones, St. Louis, MO, pleaded guilty on multiple charges involving the September 25, 2015, shooting of Christopher Sanna, as well as the robberies of both Sanna and his companion, Lisa Simpson. The robberies and the assault occurred near the Old Cathedral in the northbound lanes of Memorial Drive, which is part of the Jefferson National Expansion Memorial.
According to court documents, on September 25, 2015, at approximately 10:30 p.m., victims Christopher Sanna and Lisa Simpson were walking back to their car, which was parked on the Old Cathedral parking lot, after attending a St. Louis Cardinals baseball game. Kilwa Jones confronted them with a High Point make, C9 model, 9mm semi-automatic pistol and demanded their property. As the victims attempted to ignore Jones and walk toward their vehicle, Jones shot Sanna in the back, forcibly grabbed Simpson’s purse and rifled the pants pockets of Sanna as he lay paralyzed on the ground. Jones then jumped into a car and drove away.
Jones pleaded guilty to assault with a dangerous weapon while on federal property, possession of a firearm in furtherance of a crime of violence, two counts of robbery while on federal property and the charge of being a felon in possession of a firearm. Under the plea agreement, Jones faces a penalty of up to 35 years in prison and/or fines of up to $250,000 on each count. Sentencing has been set for October 6, 2016.
This case was investigated by the detective bureau of the St. Louis Metropolitan Police Department. Assistant United States Attorney John Bird is handling the case for the U.S. Attorney’s Office.
St. Louis Area Man Sentenced on Fraud ChargesRead the Press Release
St. Louis, MO – Stacey Wilson was sentenced to 81 months in prison on charges involving wire and bank fraud.
According to court documents, on or about November 1, 2013, and continuing to on or about December 1, 2015, Stacey Wilson and his accomplice recruited approximately 53 individuals to open checking accounts at U.S. Bank with nominal amounts of money, or provide access to their existing checking accounts. The recruited individuals provided their debit cards and checks issued on the accounts. In addition to checks and debit cards received from the recruited individuals, they obtained checks and debit cards from the victims of motor vehicle break-ins. Wilson and his accomplice drafted the checks in amounts ranging from $195.00 to $2,300.00 before depositing them into different fraudulently issued accounts through electronic wire transmissions of the checks’ images or through direct deposits. As soon as the funds were deposited, Wilson and others obtained funds from the financial institutions through automated teller machine transactions, counter withdrawals or debit card purchases. Unbeknownst to the financial institutions which accepted the fraudulently obtained checks for deposit, the accounts upon which the checks had been drawn were artificially inflated or had been closed as being fraudulent. As a result of the scheme, Wilson and others obtained, and attempted to obtain, more than $79,000.00 through more than 270 fraudulent transactions.
Wilson, of St. Louis City, pled guilty March 16, 2016, to felony counts of aggravated identity theft, wire fraud and access device fraud. He appeared today for sentencing before United States District Judge Ronnie L. White. In addition to the sentence of 81 months imprisonment, Wilson was ordered to pay restitution in the amount of $44,325.66.
The case was investigated by the United States Postal Inspection Service. Assistant United States Attorney Tracy Berry handled the case for the U.S. Attorney’s Office.
Former Insurance Agent/Broker Senenced on Wire Fraud ChargeRead the Press Release
St. Louis, MO – Donald Novak, former licensed insurance agent and broker for various insurance companies, was sentenced to 29 months in prison on charges involving wire fraud. The sentence also included orders of restitution and criminal forfeiture.
According to court documents, between July 28, 2011 and July 30, 2015, Novak devised a scheme to defraud a distant relative, who suffered from certain mental limitations, of inherited assets. The fraud involved the investment, by Novak, of the victim’s funds in annuities which Novak, in turn, surrendered, misappropriated and converted for his own personal use.
"Donald Novak liquidated his client’s retirement assets only to benefit himself and not his client," said Special Agent in Charge William Woods of the FBI St. Louis Division. "This type of fiduciary abuse is on the FBI’s radar, especially going forward with new federal regulations that require financial advisors and brokers to act in the best interest of their clients."
Novak, Ellisville, Missouri, pled guilty in March 2016 to one felony count of wire fraud. He appeared today for sentencing before United States District Judge Ronnie L. White.
The case was investigated by the Postal Inspection Service and Federal Bureau of Investigation. Assistant United States Attorney Charles Birmingham handled the case for the U.S. Attorney’s Office.
Washington State Man Pleads Guilty to Fraud ChargesRead the Press Release
St. Louis, MO – Haben Sebhatu, Bellevue, Washington, pled guilty to possessing more than 100 counterfeit credit cards and credit card making equipment during a multi-state trip during which he conducted numerous fraudulent transactions.
Sebhatu was arrested by the Ladue Police Department on March 25, 2016, and a search of his vehicle revealed the fraudulent credit cards and a card encoder used to place stolen card numbers and other information on a card’s magnetic strip. Sebhatu admitted to organizing the trip.
Sebhatu appeared before Judge Audrey G. Fleissig, who accepted his guilty plea this morning in U.S. District Court in St. Louis. Sentencing has been set for September 20, 2016.
Sebhatu faces up to fifteen years in prison, per count, for possession of more than fifteen counterfeit cards and possession of device making equipment. In addition to a term of imprisonment, Sebhatu faces up to a $250,000 fine per count and mandatory restitution to the victims. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
In addition to his federal case in St. Louis, Sebhatu faces criminal charges in his home state of Washington for identity theft and forgery.
The case was investigated by the Ladue (Missouri) Police Department, the U.S. Secret Service and the Pierce County (Washington) Prosecuting Attorney’s Office. Restitution to the victims is also mandatory.
Assistant United States Attorney Tom Albus is handling the case for the U.S. Attorney’s Office.
St. Louis County Man Indicted on Fraud ChargesRead the Press Release
St. Louis, MO – Charles Hicks, Fenton, Missouri, was indicted Wednesday afternoon on mail fraud charges in connection with a fraud and embezzlement scheme that spanned three years and involved two employers.
According to the indictment, Hicks submitted false invoices to his ex-employers, RockTenn and MarChem, both with offices in St. Louis County, for equipment not delivered and services not rendered. The invoices were payable to two shell companies created and controlled by Hicks.
If convicted, Hicks faces up to 20 years imprisonment and/or a fine of $250,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges. Restitution to the victims is also mandatory.
This case was investigated by the FBI and the U.S. Postal Inspection Service. Assistant United States Attorney Tom Albus is handling the case for the U.S. Attorney’s Office.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
Cape Girardeau Man Charged with Interstate Domestic Violence for 2011 Murder of his WifeRead the Press Release
Cape Girardeau, MO - The United States Attorney's Office announced today the unsealing of an indictment charging James Clay Waller II with Interstate Domestic Violence in violation of Title 18, United States Code, Section 2261(a)(1). The offense of Interstate Domestic Violence was enacted by Congress in 1994 as part of the Violence Against Women Act. A violation of the Act includes a possible prison sentence up to life imprisonment.
The indictment alleges that in June of 2011, Waller traveled back and forth between Illinois and Missouri with the intent to kill his wife, Jacque Sue Waller, and did in fact murder her. The indictment also seeks forfeiture of any proceeds that might be derived from a manuscript intended to be published as a book that details the facts of the murder.
In 2012 Waller was charged under state law with the murder of his wife, despite the fact that her body had never been recovered. That prosecution was resolved with Waller pleading guilty in exchange for a twenty-year sentence and leading authorities to the unmarked grave in Illinois where he had hidden and buried his wife’s body. During the guilty plea, Waller was specifically advised by the Court that any resolution of the state charges was not necessarily binding on federal authorities.
United States Attorney Richard Callahan commended the Cape Girardeau County Prosecuting Attorney’s Office for its handling of the state prosecution. He noted that although it is highly unusual for his office to follow a state prosecution with a federal prosecution of basically the same criminal conduct, "the facts and circumstances of this case begged for such a prosecution."
This murder has been investigated by a host of law enforcement agencies, including the Federal Bureau of Investigation, the Cape Girardeau County Major Case Squad, the Jackson City Police Department, the Cape Girardeau City Police Department, the Missouri State Highway Patrol and the Cape Girardeau County Sheriff’s Department.
The federal prosecution of the case will be handled by Assistant United States Attorney Larry H. Ferrell.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
Area Tax Preparer Pleads Guilty to Tax ChargesRead the Press Release
St. Louis, MO – Ricker Brooks pled guilty to charges involving his preparation of false tax returns by overstating business expenses of a client for the tax years 2009 and 2010. Brooks owns Brooks Accounting Service, providing accounting and tax preparation services. Zondra Jones owns Alliance In-Home Care Services, which provides home health care services to individuals.
According to court documents, after Jones reviewed the tax returns that Brooks prepared for her, she thought that the contract labor expense for her business was overstated. Although there was discussion between the two of them regarding the overstatement, Jones and Brooks agreed to file the tax returns with the overstatement. After the IRS began to investigate the returns, Brooks prepared false 1099 forms and check schedules which falsely represented payments made by Alliance In-Home Care Services to contract employees. Jones provided these false documents to the IRS.
"Today, Mr. Brooks admitted that he blatantly ignored the tax laws by preparing false tax returns," said Karl Stiften, Special Agent in Charge of IRS Criminal Investigation. "Dishonest return preparers use a variety of methods to cheat the government, including falsifying information on the tax returns to generate larger refunds for their clients."
Brooks, St. Louis County, Missouri, pled guilty to one felony count of conspiracy to defraud the United States and two felony counts of aiding and assisting in the preparation of a false income tax return. He appeared today before United States District Judge Ronnie L. White. Sentencing has been set for August 23, 2016.
Zondra Jones, Florissant, Missouri, pled guilty last November to related charges and is awaiting sentencing on May 26, 2016.
Conspiracy carries a maximum penalty of five years in prison and or fines up to $250,000; aiding in the preparation of a false income tax return carries a maximum penalty of three years prison and/or fines up to $250,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by IRS Criminal Investigation. Assistant United States Attorney Steven Muchnick is handling the case for the U.S. Attorney's Office.
St. Louis Area Woman Sentenced on Charges Involving a Credit Card Fraud SchemeRead the Press Release
St. Louis, MO – Cherri Barton was sentenced to 57 months in prison on charges involving a scheme to defraud several elderly victims and credit card issuers of more than $112,588 between August 2012 and May 2015. Barton called elderly individuals and told them their accounts were past due in order to obtain their identifying information and bank account information. She then used the information to purchase items, including gift cards.
According to court documents, in August 2012, Barton began telephoning elderly people with a ruse that their utilities were in danger of being disconnected due to lack of payment. In order to continue service, they were required to provide a credit card number. In further discussions, Barton also obtained identifying information, such as social security numbers and dates of birth. Using this information, Barton contacted the victims’ creditors and added herself as an authorized user to the credit accounts. In order to perpetrate the scheme, Barton also transferred the telephone services of some of the victims to her cell phone so when creditors attempted to contact the legitimate account holders, they reached the defendant.
Barton, St. Louis County, pled guilty in January to one felony count of aggravated identity theft and three felony counts of access device fraud. She appeared today for sentencing before United States District Judge Carol E. Jackson.
The case was investigated by the Postal Inspection Service, St. Louis County Police Department and the cities of Maryland Heights, Florissant, Overland, St. Louis, Clayton, Webster Groves and University City. Assistant United States Attorney Tracy Berry handled the case for the U.S. Attorney’s Office.
Cape Girardeau County Man Pleads Guilty to Federal Charges Involving Food Stamp FraudRead the Press Release
Cape Girardeau, MO – The co-owner of B & H Convenience store pled guilty Monday to charges of misusing the Supplemental Nutrition Assistance Program (SNAP), formerly known as the food stamp program. Patrick Buck admitted with his plea that he illegally redeemed up to $550,000 in SNAP benefits between January 2010 and March 2014.
According to court documents, the Missouri Department of Social Services, Family Support Division (FSD) issues Electronic Benefits Transfer Cards (EBT) for the Supplemental Nutrition Assistance Program (SNAP), more commonly known as food stamps. Authorized grocery retailers can only accept and redeem SNAP benefits for the sale of eligible food items. They are not permitted to exchange or redeem SNAP benefits for cash or other ineligible items such as household goods, alcoholic beverages, tobacco products, cellular telephones or other non-food items.
Patrick Buck, Cape Girardeau, MO, pled guilty to four felony counts of unauthorized use of SNAP benefits. He appeared Monday in Cape Girardeau before United States District Judge Ronnie L. White. Sentencing has been set for August 15, 2016.
Each count carries a maximum penalty of five years in prison and/or fines up to $250,000. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the United States Department of Agriculture, Office of Inspector General-Investigations and Sikeston Department of Public Safety. Assistant United States Attorney Anthony L. Franks is handling the case for the U.S. Attorney’s Office.
Cape Girardeau County Man Pleads Guilty to Federal Charges Involving Crop Insurance FraudRead the Press Release
Cape Girardeau, MO – Bobby David Lowrey pled guilty to multiple charges involving federal crop insurance fraud, theft of government property and wire fraud.
According to court documents, Bobby David Lowrey owned and operated farms and related businesses in Parma, New Madrid County, Missouri, including Bobby David Lowrey Farms, Lowrey and Lowrey, Inc. of Parma, Missouri, John Radin Farms and Kathy Ellsworth Farms.
Bobby David Lowrey placed farms in other people’s names in order to obtain Direct and Counter-cyclical Payment Program proceeds that he was not eligible to receive under the federal government’s crop insurance program. The investigation disclosed that John Radin, the alleged operator of Radin Farms, was employed by Bobby David Lowrey and not actively engaged in farming and did not have any financial interest in the farming operations. Lowery made false statements to the United States Department of Agriculture pertaining to the Federal Crop Insurance Corporation and Direct and Counter-cyclical Payment Program.
From 2007 to 2012, Bobby David Lowrey obtained $240,367 in Direct and Counter-cyclical Payments in the name of John Radin Farms. Additionally, $207,729 worth of Multiple Peril Crop Insurance Indemnities, premium subsidies and administrative subsidies were paid on behalf of John Radin Farms between 2008 and 2012.
The investigation also disclosed that between 2006 and 2011, Bobby David Lowrey transmitted by wire “Extended Work Search Waivers” to the Missouri Division of Employment Security and reported that his employees were on a temporary layoff when in reality they were still working and being paid. The transmissions made to the Missouri Division of Employment Security resulted in more than $60,000 worth of unemployment Insurance benefits being paid to employees that they were not eligible to receive.
Bobby David Lowrey, Parma, MO, pled guilty to two felony counts of making false statements regarding crop insurance benefits, one felony count of theft of government property and one felony count of wire fraud before United States District Judge Stephen N. Limbaugh, Jr., in Cape Girardeau. Sentencing has been set for August 16, 2016.
These charges carry penalties ranging from 5 to 30 years in prison and or fines up to $1 million. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the United States Department of Agriculture-Office of Inspector General-Investigations, Missouri State Highway Patrol-Rural Crimes Investigative Unit and United States Department of Labor-Office of Inspector General-Investigations. Assistant United States Attorney Anthony L. Franks is handling the case for the U.S. Attorney’s Office.