Middle District of North Carolina
Press releases recorded for this federal judicial district.
Middle District of North Carolina U.S. Attorney’s Office Collects More Than $2.2 Million in Civil and Criminal Actions for U.S. Taxpayers in Fiscal Year 2018Read the Press Release
Greensboro, NC - U.S. Attorney Matthew G.T. Martin announced today that the Middle District of North Carolina collected $2,235,279.81 in criminal and civil actions in Fiscal Year 2018. Of this amount, $1,719,336.45 was collected in criminal actions and $515,943.36 was collected in civil actions.
Additionally, the Middle District of North Carolina worked with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional $48,379.33 in cases pursued jointly by these offices. Of this amount, $1,250.21 was collected in criminal actions and $47,129.12 was collected in civil actions.
As a whole, the Justice Department collected nearly $15 billion in civil and criminal actions in the fiscal year ending Sept. 30, 2018. The $14,839,821,650 in collections in FY 2018 represents nearly seven times the appropriated $2.13 billion ($2,136,750,000) budget for the 94 U.S. Attorneys’ offices.
“The men and women of the U.S. Attorneys’ offices across the country work diligently, day in and day out, to see that the citizens of our nation receive justice. The money that we are able to recover for victims and this country as a whole is a direct result of their hard work,” Director James A. Crowell, IV, Executive Office for U.S. Attorneys.
“Our office is dedicated to protecting our citizens, safeguarding taxpayer resources, and recovering ill-gotten gains from fraud, drug offenses, and other crimes and returning those funds to victims and to the treasury,” said United States Attorney Martin. “In FY2018, our office honored its ongoing commitment to seek justice for victims of crime and hold to account those who seek profit from illegal activities.”
The U.S. Attorney’s Office in the Middle District of North Carolina, working with partner agencies and divisions, also collected $2,860,479.00 in asset forfeiture actions during FY 2018. Forfeited assets deposited into the Department of Justice Asset Forfeiture Fund are used to restore funds to crime victims and for a variety of law enforcement purposes.
In May, the Middle District of North Carolina collected $55,267.16 from an account in the name of Kimberly Russell Hobson. Hobson, a former accounting and finance employee at High Point Regional Hospital, diverted almost $4 million of hospital funds to her own benefit over a period of approximately ten years. Hobson was sentenced to 102 months in prison and ordered to pay restitution in the full amount of the loss. In addition to the post-judgment collection from Hobson, investigators seized and forfeited cash, numerous vehicles, and other assets she purchased with proceeds of her schemes. All collections and monies recovered through forfeiture will be applied towards restitution in the case.
The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims Fund, which distributes the funds collected to federal and state victim compensation and victim assistance programs.
The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws. In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, the Department of Health and Human Services, the Internal Revenue Service, the Small Business Administration and the Department of Education.
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Known Gang Associate Sentenced to over 15 Years in Federal PrisonRead the Press Release
GREENSBORO, N.C. B A Greensboro resident and known gang associate was sentenced on March 11, 2019, in federal court in Greensboro, announced United States Attorney Matthew G.T. Martin of the Middle District of North Carolina.
The Honorable William L. Osteen, II, sentenced Derrick Jerell STREETER, 23, of Greensboro, North Carolina, to a 186 month term of imprisonment on charges of felon in possession of a firearm. In addition to 186 months imprisonment, STREETER was ordered to serve five years of supervised release after completing his sentence. STREETER pleaded guilty in December 2018.
On June 12, 2018, members of the Greensboro Police Department Violent Criminal Apprehension Team and North Carolina State Bureau of Investigation were conducting surveillance at the Super 8 Motel, located at 2108 W. Meadowview Road in Greensboro, North Carolina, in an attempt to locate a wanted subject. The wanted subject, STREETER, had several outstanding warrants for a burglary where several firearms were stolen.
During surveillance STREETER and another person exited the front door of the motel and entered a 2013 Hyundai Elantra. The car exited the motel parking lot with STREETER in the front passenger seat. GPD VCAT stopped the car at the intersection of Rehobeth Church Road and Vandalia Road in Greensboro.
GPD VCAT detectives approached the vehicle and ordered STREETER to exit from the passenger door. STREETER complied with the commands and was taken into custody. While being taken into custody STREETER acknowledged that he had a gun in his back pocket. GPD VCAT detectives located and removed a .380 caliber Ruger handgun that was loaded with three rounds in the magazine and one round in the chamber. The firearm located on STREETER was verified as being stolen from the burglary that STREETER was wanted for.
Prior to this arrest, STREETER had been convicted of Common Law Robbery with an offense date of September 9, 2013, two Breaking and Entering convictions, the first with an offense date of February 20, 2013 and the second with an offense date of April 13, 2013,and Second Degree Burglary with an offense date of May 12, 2014.
“Reducing violent crime is a top priority. We will continue to partner with Greensboro PD, the SBI, and the ATF to prosecute violent offenders and dismantle violent groups,” said U.S. Attorney Martin. The case was investigated by the Greensboro Police Department, the North Carolina State Bureau of Investigation, and the Bureau of Alcohol, Tobacco, Firearms, and Explosives. The case was prosecuted by Assistant United States Attorney Nicole R. DuPré.
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Randolph County Resident Pleads Guilty to Federal Credit Card Fraud ChargesRead the Press Release
GREENSBORO, N.C. - Matthew G.T. Martin, United States Attorney for the Middle District of North Carolina, announced today that ANTHONY THOMAS HARRELSON, 39, of Sophia, North Carolina, pleaded guilty in federal court in Greensboro before the Honorable N. Carlton Tilly, to seven felony charges of use of an unauthorized access device (i.e., a credit card).
HARRELSON pleaded guilty to using credit cards fraudulently obtained from J.P. Morgan Chase Bank and American Express. The indictment alleges that HARRELSON purchased merchandise, jewelry, gold coins, meals at restaurants, vehicles, and firearm parts in excess of $350,161.47 with the fraudulent credit cards. The exact amount of the loss will be determined by the Court at sentencing.
The defendant faces a maximum potential penalty of seventy years imprisonment. The plea agreement requires HARRELSON to make restitution and to forfeit money and goods acquired from use of the fraudulent credit cards. Sentencing is scheduled for federal court in Greensboro on June 27, 2019, at 2 p.m.
The case was investigated by the United States Postal Inspection Service, the Bureau of Alcohol, Tobacco, Firearms, and Explosives, and the Randolph County Sheriff's Department. The case was prosecuted by Assistant United States Attorneys Frank J. Chut, Jr. and Steven N. Baker.
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North Carolina Mental Health Company Owner Sentenced to 60 Months in Prison on Health Care Fraud and Tax Evasion ChargesRead the Press Release
The owner of a North Carolina mental health company was sentenced to prison today for the submission of false claims to Medicaid and tax evasion, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina.
Catinia Denise Farrington, a resident of Cypress, Texas, was sentenced to 60 months in prison on each count to run concurrently by U.S. District Court Judge N. Carlton Tilley Jr. of the Middle District of North Carolina. On Sept. 4, 2018, Farrington pleaded guilty to one count of health care fraud conspiracy and one count of tax evasion for the tax year 2014.
According to the documents filed with the court, Farrington owned Durham County Mental Health and Behavioral Health Services LLC (DCMBHS) in Durham, North Carolina. From 2011 through 2015, Farrington submitted thousands of false claims to Medicaid for services that were not performed, resulting in approximately $4 million in wrongful payments to DCMBHS. During the relevant period, Haydn Thomas worked as an office manager for an oral surgeon and provided Farrington with the names and Medicaid identification numbers of dental patients. The patient information was used to submit the false claims to Medicaid.
In addition, Farrington earned more than $1.1 million from DCMBHS and evaded income taxes on this money by transferring funds to various business bank accounts and paying personal expenses from the business bank accounts while failing to file tax returns. The resulting tax loss is approximately $391,747.
In addition to the term of imprisonment imposed, Farrington was ordered to serve three years of supervised release and to pay restitution in the amount of $3,950,656 to NC Fund for Medical Assistance and $391,747 to the Internal Revenue Service.
Co-defendant Thomas previously pleaded guilty to making a false statement related to a health care matter and tax evasion. His sentencing hearing is set for March 27, 2019.
Principal Deputy Assistant Attorney General Zuckerman and United States Attorney Martin commended special agents of the Internal Revenue Service and the U.S. Department of Health and Human Service, Office of Inspector General, who conducted the investigation, and Assistant United States Attorney Robert Hamilton, Trial Attorney Mara Strier of the Tax Division and Special Assistant U.S. Attorney Michael Heavner of the Medicaid Investigations Division of the North Carolina Attorney General’s Office, who prosecuted the case.
North Carolina Mental Health Company Owner Sentenced to 60 Months in Prison on Health Care Fraud and Tax Evasion ChargesRead the Press Release
WASHINGTON - The owner of a North Carolina mental health company was sentenced to prison today for the submission of false claims to Medicaid and tax evasion, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina.
Catinia Denise Farrington, a resident of Cypress, Texas, was sentenced to 60 months in prison on each count to run concurrently by U.S. District Court Judge N. Carlton Tilley, Jr. of the Middle District of North Carolina. On September 4, 2018, Farrington pleaded guilty to one count of health care fraud conspiracy and one count of tax evasion for the tax year 2014.
According to the documents filed with the court, Farrington owned Durham County Mental Health and Behavioral Health Services, LLC (“DCMBHS”) in Durham, North Carolina. From 2011 through 2015, Farrington submitted thousands of false claims to Medicaid for services that were not performed, resulting in approximately $4 million in wrongful payments to DCMBHS. During the relevant period, Haydn Thomas worked as an office manager for an oral surgeon and provided Farrington with the names and Medicaid identification numbers of dental patients. The patient information was used to submit the false claims to Medicaid.
In addition, Farrington earned more than $1.1 million from DCMBHS and evaded income taxes on this money by transferring funds to various business bank accounts and paying personal expenses from the business bank accounts while failing to file tax returns. The resulting tax loss is approximately $391,747.
In addition to the term of imprisonment imposed, Farrington was ordered to serve three years of supervised release and to pay restitution in the amount of $3,950,656 to NC Fund for Medical Assistance and $391,747 to the Internal Revenue Service.
Co-defendant Thomas previously pleaded guilty to making a false statement related to a health care matter and tax evasion. His sentencing hearing is set for March 27, 2019.
Principal Deputy Assistant Attorney General Zuckerman and United States Attorney Martin commended special agents of the Internal Revenue Service and the U.S. Department of Health and Human Service, Office of Inspector General, who conducted the investigation, and Assistant United States Attorney Robert Hamilton, Trial Attorney Mara Strier of the Tax Division and Special Assistant U.S. Attorney Michael Heavner of the Medicaid Investigations Division of the North Carolina Attorney General’s Office, who prosecuted the case.
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Kannapolis Man Sentenced in Production of Child Pornography CaseRead the Press Release
GREENSBORO, N.C. – A man who pleaded guilty to production of child pornography was sentenced today, announced Matthew G.T. Martin, United States Attorney for the Middle District of North Carolina.
ANTHONY JAMES BARRY, 19, of Kannapolis, North Carolina, pleaded guilty on November 7, 2018, to one count of production of child pornography. He was sentenced by United States Chief District Judge Thomas D. Schroeder to 204 months of imprisonment followed by 10 years of supervised release.
In April 2018, an adult woman made a report to the Boone Police Department (BPD) that an individual, purporting to be a modeling agent, was attempting to extort her via Snapchat; a mobile messaging application. BPD Detective Jason Reid’s subsequent investigation revealed that the IP addresses used by the suspect resolved to BARRY’s residence in Rowan County. Detective Reid also discovered that BARRY had used Snapchat to attempt to extort sexual images from numerous minors and to trade child pornography. During a May 2018 incident, BARRY, purporting to be a government agency, coerced an 11 year old girl to produce a child pornography image of her sleeping 10 year old sister.
On July 27, 2018, law enforcement agents arrested BARRY and searched his home. BARRY admitted that he found his victims by perusing LiveMe; a social media application that enables users to broadcast themselves and is popular with young people. He also admitted to trading child pornography and recalled extorting the 11 year old girl.
This case was investigated by the Boone Police Department, a member of the Internet Crimes Against Children (ICAC) Task Force, in conjunction with the North Carolina State Bureau of Investigation and Homeland Security Investigations. The case was prosecuted by Assistant United States Attorney Eric L. Iverson.
It was brought as part of Project Safe Childhood, a nationwide initiative by the Department of Justice to combat online child sexual exploitation and abuse. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
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Virginia Man Charged with Use of Firearms and Stolen Car in Relation to Attempted Crime of Interstate Domestic ViolenceRead the Press Release
U.S. Attorney Matt Martin announcing charges against Steve Brantley Spence with Greensboro Police Chief Wayne Scott and Dr. Tony Watlington of Guilford County SchoolsGREENSBORO, N.C. – A federal grand jury in Greensboro, North Carolina, returned a three count indictment charging Steve Brantley Spence of Norfolk, Virginia, with interstate transportation of a stolen motor vehicle, traveling with the intent to kill, injure, harass, and intimidate in an attempt to commit a crime of domestic violence, and using and carrying firearms in relation to a crime of violence, announced Matt Martin, United States Attorney for the Middle District of North Carolina.
The indictment alleges that on December 3, 2018, Steve Brantley Spence, age 29, transported a stolen 2015 Mercedes Benz ML350 from Virginia to North Carolina, in violation of 18 U.S.C. § 2312. The indictment further alleges that on December 3, 2018, Spence traveled from Virginia to Greensboro, N.C., with the intent to kill, injure, harass, and intimidate two persons, each of whom then was a spouse, intimate partner, or dating partner of Spence, and in the attempt to commit a crime of violence, Spence possessed two handguns, in violation of 18 U.S.C. § 2261(a)(1). The indictment further alleges that on December 3, 2018, Spence did carry and use, by brandishing, two handguns, during and in relation to a crime of interstate domestic violence, in violation of 18 U.S.C. § 924(c).
An indictment is merely an allegation, and the defendant is presumed innocent unless and until proven guilty. If convicted, Spence faces a maximum sentence of life in prison and a $250,000 fine.
“Let there be no doubt, we will not tolerate people crossing state lines to hunt down former intimate partners, and we will prosecute such crimes to the fullest extent of the law,” said U.S. Attorney Martin. “This case reflects the strength of our federal-local partnerships, and the Greensboro Police Department did excellent work to apprehend Mr. Spence without harm to students or school faculty. GPD performed a thorough investigation in conjunction with our office to allow these charges to be brought.”
The case is being investigated by the Federal Bureau of Investigation and the Greensboro Police Department. The case is being prosecuted by Special Assistant U.S. Attorney Veronica L. Edmisten, and by Assistant U.S. Attorney Clifton T. Barrett, Criminal Chief of the United States Attorney’s Office.
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Man Sentenced After Being Caught with Child Pornography in Moore CountyRead the Press Release
GREENSBORO, N.C. – A man who pleaded guilty to receipt of child pornography was sentenced today, announced Matthew G.T. Martin, United States Attorney for the Middle District of North Carolina.
KEVIN SCOTT SMITH, 40, of Lumberton, North Carolina, pleaded guilty on August 10, 2018, to one count of receipt of child pornography. He was sentenced by United States District Judge William L. Osteen, Jr. to 72 months of imprisonment followed by 10 years of supervised release.
SMITH first came to the attention of investigators with Moore County Sheriff’s Office as the result of a National Center for Missing and Exploited Children (NCMEC) CyberTipline report made by a cloud storage service provider. NCMEC’s CyberTipline is the nation’s centralized reporting system for online sexual exploitation of children. As a member of the North Carolina Internet Crimes Against Children (ICAC) Task Force, the Moore County Sheriff’s Office receives and investigates CyberTipline reports. In March 2018, detectives with the Moore County Sheriff’s Office executed a search warrant on a residence in Pinebluff, North Carolina where SMITH had been living and placed him under arrest.
“This case exemplifies how excellent federal, state, and local law enforcement coordination can protect our children from exploitation. Thank you to the Moore County Sheriff’s Office for participating in the Internet Crimes Against Children Task Force,” said U.S. Attorney Martin.
This case was prosecuted by Assistant United States Attorney Eric L. Iverson. It was brought as part of Project Safe Childhood, a nationwide initiative by the Department of Justice to combat online child sexual exploitation and abuse. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
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Laurinburg Man Sentenced to 180 Months in Prison for Firearms and Drug ChargesRead the Press Release
GREENSBORO, N.C. – A Laurinburg man who sold firearms and cocaine was sentenced to federal prison today, announced Matthew G.T. Martin, United States Attorney for the Middle District of North Carolina.
VONERIC LAQUANE PRIMUS pleaded guilty on September 5, 2018, to six counts of possession of a firearm by a previously convicted felon, four counts of distribution of cocaine base (“crack”), and one count of possessing a firearm during and in relation to a drug trafficking crime. PRIMUS was sentenced by United States District Judge N. Carlton Tilley Jr. to 180 months of imprisonment, followed by 5 years of supervised release.
On six occasions beginning on May 2, 2018, and ending on June 6, 2018, PRIMUS sold firearms and crack cocaine to a confidential informant working with the Bureau of Alcohol, Tobacco, Firearms and Explosives. PRIMUS sold a total of seven handguns and approximately 252 grams of crack cocaine during that period, with all of those sales occurring in Scotland County, North Carolina. PRIMUS had previously been convicted of state felonies for discharging a weapon into occupied property, possession of a firearm by a felon, and possession of a Schedule II controlled substance.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Laurinburg Police Department, and prosecuted by Assistant United States Attorney Anand P. Ramaswamy for the Middle District of North Carolina.
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Financial Advisor Sentenced to 28 Months in Prison for Misappropriating Funds from NFL PlayersRead the Press Release
GREENSBORO, N.C. - A Florida financial advisor who provided financial services to professional athletes was sentenced to prison today for conspiring to commit wire fraud and money laundering, announced Matthew G.T. Martin, U.S. Attorney for the Middle District of North Carolina.
Jason Christopher JERNIGAN, age 44, a resident of Miramar, Florida, was sentenced to 28 months in prison by U.S. District Court Judge N. Carlton Tilley, Jr. of the Middle District of North Carolina.
According to court documents, JERNIGAN, along with his business partner Michael Rowan, operated Capital Management Wealth Advisors, Inc. (“CMG”) and APS Management, LLC (“APS”) in High Point, North Carolina. Through CMG and APS, JERNIGAN and Rowan provided financial and investment services to professional athletes, including players in the National Football League. From 2008 through 2014, JERNIGAN used his access to his clients’ bank accounts to convert and misappropriate approximately $1.48 million.
On March 7, 2018, JERNIGAN pleaded guilty to one count of conspiracy to commit wire fraud and money laundering. JERNIGAN’s business partner, Michael Rowan, was sentenced in April 2017 to 65 months in prison for wire fraud and filing a false 2011 tax return.
In addition to the term of imprisonment imposed, JERNIGAN was order to serve three years of supervised release and to pay restitution in the amount of $1,290,980 to the victims/clients.
U.S. Attorney Martin stated, “Fighting fraud is a priority of our office. I commend the excellent work of the special agents of IRS-Criminal Investigation and US Postal Inspection Service who investigated the case, and Assistant United States Attorney Frank Chut and Trial Attorney Mara Strier of the Tax Division, who prosecuted this case.”
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Durham Woman Who Defrauded Elderly Victim Pleads GuiltyRead the Press Release
Winston-Salem, N.C. – A woman who embezzled from an older person for whom she was a caretaker pleaded guilty to federal charges on Friday, February 8, announced United States Attorney Matthew G.T. Martin for the Middle District of North Carolina.
Teresa Denise Schneider, 52, of Durham, North Carolina, pleaded guilty to one count of bank fraud and one count of wire fraud, in front of the Honorable Loretta C. Biggs, United States District Judge for the Middle District of North Carolina.
“We should honor our elders, not steal from them. Ms. Schneider abused her position of trust as caretaker. We will aggressively pursue those who commit such acts,” said U.S. Attorney Martin, adding, “I commend the Department of Treasury Task Force, NC SBI, and AUSA Chut who worked diligently to make sure this defendant is held accountable for exploiting a vulnerable victim and abusing the trust of the victim’s family.”
According to court documents, Schneider began caring for the victim in 2010 and continued to do so until the victim’s death of natural causes at the age of ninety in 2013. During this time, family members of the victim, who visited almost daily, became concerned about Schneider’s involvement in the victim’s finances. In September 2011, a family member instructed Schneider to provide monthly copies of all bank and credit card statements. Schneider complied, but after the victim’s death, the family discovered that the account statements Schneider provided had been altered to remove or conceal transfers of funds to Schneider. In total, Schneider embezzled approximately $370,000 from the victim.
Schneider’s main source for converting the victim’s funds to her own use involved the victim’s credit card. Schneider transferred funds from the victim’s deposit and investment accounts to overpay wildly the credit card by tens of thousands of dollars. Schneider then converted this money in two ways. First, she made numerous unauthorized purchases on the card, including paying for spa treatments, travel, college tuition, dining, and expensive shopping sprees at department stores. Second, Schneider used a direct transfer feature of the credit card to transfer over $100,000 to her personal bank account.
Schneider knew that she was not entitled to these funds and not authorized to make these transfers.
The sentencing is set for July 18, 2019, at 9:30 a.m. in Winston-Salem. Schneider faces up to thirty years in prison, a fine of up to $1,000,000, and supervised release of not more than five years following release from prison. At sentencing Schneider will also be ordered to pay restitution.
This case was investigated by the United States Department of Treasury Office of Inspector General Task Force and the North Carolina State Bureau of Investigation. Assistant United States Attorney Frank J. Chut, Jr. prosecuted the case.
Elder abuse includes physical abuse, caregiver neglect, financial exploitation, psychological abuse, sexual abuse, and abandonment. Since President Trump signed the bipartisan Elder Abuse Prevention and Prosecution Act into law, the Department of Justice has participated in hundreds of enforcement actions in criminal and civil cases that targeted or disproportionately affected seniors. Elder fraud complaints may be filed with the FTC at www.ftccomplaintassistant.gov or at 877-FTC-HELP.
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Middle District of North Carolina Recognizes Outstanding Law Enforcement Officers, AgencyRead the Press Release
GREENSBORO, N.C. – Matthew G.T. Martin, United States Attorney for the Middle District of North Carolina, presented awards to representatives from three local law enforcement agencies for their outstanding accomplishments during the year. Individual awards were presented to Detective Chrystal Overcash of the Guilford County Sheriff’s Office and Detective David Walker of the Orange County Sheriff’s Office. An award for outstanding law enforcement agency was presented to the Burlington Police Department Gang and Violent Crimes Unit.
Award recipient: Detective Chrystal Overcash, Guilford County Sheriff’s Office
While assigned as a Task Force Officer to the Treasury Office of Inspector General, Detective Chrystal Overcash was instrumental in the prosecution of Kimberly Hobson. Hobson defrauded High Point Regional Hospital, using her position in the hospital’s financial department, embezzling almost 4 million dollars from the hospital, to the detriment of the hospital and the community it serves.
Thanks in large part to Detective Overcash’s efforts, the federal prosecution of Hobson was successful. Hobson pleaded guilty and was sentenced to 102 months imprisonment and ordered to pay $3.8M in restitution. In addition, we were able to seize and forfeit the cash in Hobson’s bank accounts, 12 vehicles (including 2 in Romania), numerous items of personal property, and Hobson’s residence.
Award recipient: Detective David Walker, Orange County Sheriff’s Office
During 2018, while assigned as a Task Force Officer to the Drug Enforcement Administration/Raleigh Office, Detective Walker served as the primary agent on the Roderick Lamar Sanford investigation. Sanford and four coconspirators were engaged in the distribution of heroin (often, laced with Fentanyl) in and around Durham, NC from 2014 until their arrests last year.
The investigation was complicated by the fact that the main cooperating witness (CW) in the case was a recovering heroin addict who experienced relapses in sobriety on at least two occasions during the investigation (and was arrested at least once by Alamance Co. LEOs). The CW’s continued drug use and arrest impacted the CW’s credibility as a witness. Det. Walker expended dozens of hours gathering evidence which corroborated information provided by the CW (as well as other cooperating codefendants), as well as evidence of Sanford’s attempts to intimidate the CW into recanting statements against him.
For purposes of sentencing in his case, Sanford is being held accountable for conspiring to distribute over 20 kilograms of heroin between 2014 and 2018.
Award recipient: City of Burlington Police Department Gang and Violent Crimes Unit
This award recognizes a law enforcement agency for outstanding unit accomplishments during the award period. The criteria included:
• Evidence of the unit’s ability to successfully combat gang activity
• The creation or development of innovative gang enforcement strategies
• Mission accomplishments and successes at the unit level resulting in a decrease in gang activity
The Burlington Police Department Gang & Violent Crimes Unit (GVCU) was formed during the summer of 2016 in response to multiple gang-related violent crimes that created an unprecedented wave of violence within the Burlington jurisdiction. GVCU has been extremely successful in addressing and minimizing gang activity in Burlington by solving cases of gang violence, witness intimidation, and organized crime related to gang activity.
Officers involved in the GVCU activities and investigations detailed below include Adam Snow, JT Theriault, Al Smith, Sergeant J. Light, Lt. Alan Balog, and Capt. Bret Currie.
During the month of October 2017, GVCU investigators solved a series of four Blood gang-related shootings into occupied dwellings where two gang members were shot during separate shootings in Burlington. These crimes led to the seizure of four firearms and multiple rounds of ammunition from a convicted felon.
During the month of November 2017, GVCU investigators solved a gang/drug-related homicide that occurred in Burlington, which occurred due to a Blood gang member owing a drug debt to a Folk Nation gang member.
During the month of December 2017, GVCU investigators solved a gang/drug-related home invasion from Burlington that resulted in the seizure of a bulletproof vest, 700+ rounds of ammunition, and 4 firearms from Blood gang members, who are also convicted felons. GVCU investigators solved a gang/drug-related murder from Burlington, which occurred during a drug deal between Crip gang members and Blood gang members. Ultimately, three convicted felons were arrested and charged with murder, including the shooter.
During the month of April 2018, GVCU investigators solved a gang-related shooting in the parking lot of a sweepstakes business in Burlington. GVCU investigators also solved a Blood gang-related murder and robbery at a sweepstakes business where the security guard was shot to death inside the business during the robbery. Additionally, all persons inside the business besides a female employee were viciously and ruthlessly beat with a firearm during the robbery by the shooter. Intelligence learned during this investigation showed that this crime was for the benefit of the Blood gang, and for newly drafted gang members to earn rank in the Blood gang.
Between October 2017 and April 2018, the City of Burlington experienced an approximate 80% reduction in reports of firearms being discharged in the city, an approximate 80% reduction in reports of firearms being discharged into occupied dwellings, and a total reduction of gun-related crime by approximately 83% in the City of Burlington. These crimes are all common indicators of underlying gang problems, which often physically appear as gun- related crimes. Additionally, the City of Burlington experienced approximately three months in early 2018 without a single homicide occurring, which has not happened in Burlington for at least the last decade.
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Justice Department Settles Immigration-Related Discrimination Claim Against Honda Aircraft Company LLCRead the Press Release
WASHINGTON – The Justice Department today reached a settlement agreement with Honda Aircraft Company LLC (Honda Aircraft), a wholly owned subsidiary of American Honda Motor Co. Inc., and subsidiary of Honda Motor Co. Ltd., that manufactures and sells business jet aircrafts. The settlement resolves a claim that Honda Aircraft, headquartered in Greensboro, North Carolina, refused to consider or hire certain work-authorized non-U.S. citizens because of their citizenship status, in violation of the Immigration and Nationality Act’s (INA) anti-discrimination provision.
The Department’s independent investigation determined that between August 2015 and December 2016, Honda Aircraft published at least 25 job postings that unlawfully required applicants to have a specific citizenship status to be considered for the vacancies. The Department concluded that the company’s unlawful practice of restricting job vacancies to U.S. citizens and in some cases, to U.S. citizens and lawful permanent residents (LPR), was based on a misunderstanding of the requirements under the International Traffic in Arms Regulations (ITAR) and the Export Administration Regulations (EAR). The discriminatory job postings were published on Honda Aircraft’s website and several third-party websites.
“The Department of Justice is committed to ensuring that employers do not unlawfully exclude non-U.S. citizens because of their citizenship status,” said Assistant Attorney General Eric Dreiband of the Civil Rights Division. “Employers who are subject to the ITAR or the EAR should carefully review their responsibilities under anti-discrimination statutes.”
The ITAR regulates specific exports of defense articles and services, and – absent State Department authorization – limits access to certain sensitive information to “U.S. persons,” which are defined as U.S. citizens, U.S. nationals, lawful permanent residents, asylees, and refugees. The EAR similarly regulates commercial goods and technology that could have military applications. The EAR limits access to export-controlled technology and information to “U.S. persons” absent authorization from the Department of Commerce. Neither the ITAR nor the EAR requires or authorizes employers to hire only U.S. citizens and LPRs. Employers that limit their hiring to U.S. citizens and/or LPRs without legal justification may violate the INA’s anti-discrimination provision.
Under the settlement agreement, Honda Aircraft will pay a civil penalty of $44,626, and remove all specific citizenship requirements from current and future job postings unless they are authorized by law. The agreement also requires certain employees to attend training on the INA’s anti-discrimination provision and ensure that trained personnel review future job advertisements.
The INA’s anti-discrimination provision prohibits employers from discriminating in hiring or recruiting or referring for a fee based on a person’s citizenship, immigration status, or national origin. In the absence of a legal basis (such as a law, regulation, or government contract that requires U.S. citizenship restrictions), employers, recruiters and referrers for a fee may not limit job opportunities or otherwise impose barriers to employment based on an individual’s citizenship or immigration status. By requiring a specific citizenship status as a condition of employment, Honda Aircraft’s job postings created discriminatory barriers for work-authorized individuals and unlawfully excluded U.S. nationals, asylees, refugees, and, in some cases, LPRs.
The Division’s Immigrant and Employee Rights Section (IER) is responsible for enforcing the anti-discrimination provision of the INA. Among other things, the statute prohibits citizenship status and national origin discrimination in hiring, firing, or recruitment or referral for a fee; unfair documentary practices; and retaliation and intimidation.
More information on how employers can avoid unlawful citizenship status discrimination is available here. For more information about protections against employment discrimination under immigration laws, call IER’s worker hotline at 1-800-255-7688 (1-800-237-2515, TTY for hearing impaired); call IER’s employer hotline at 1-800-255-8155 (1-800-237-2515, TTY for hearing impaired); sign up for a free webinar; email [email protected]; or visit IER’s English and Spanish websites. Subscribe to GovDelivery to receive updates from IER.
Applicants or employees who believe they were subjected to discrimination based on their citizenship, immigration status, or national origin in hiring, firing, or recruitment or referral for a fee; or discrimination in the employment eligibility verification process (Form I-9 and E-Verify) based on their citizenship, immigration status or national origin; or retaliation can file a charge or contact IER’s worker hotline for assistance.
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Doctor Pleads Guilty to Obstructing the IRSRead the Press Release
WASHINGTON - A medical doctor pleaded guilty to corruptly obstructing the due administration of the internal revenue laws yesterday, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and United States Attorney for the Middle District of North Carolina Matthew G.T. Martin.
According to court documents, Dr. Joseph Jacob Hummel purchased the home of an acquaintance, only to be repaid for the purchase a short time later. When Special Agents with Internal Revenue Service-Criminal Investigation (IRS) interviewed Dr. Hummel about this real estate transaction, he falsely stated that he rented the property to the original owner and then sent the agents a sham lease, supporting this statement.
Hummel faces a maximum sentence of three years in prison. He also faces a period of supervised release and monetary penalties. Sentencing is scheduled for March 26, 2019.
Principal Deputy Assistant Attorney General Zuckerman and United States Attorney Martin thanked special agents of IRS-Criminal Investigation, who conducted the investigation, and Trial Attorney Kevin Schneider of the Tax Division and Assistant United States Attorney Frank Chut, who are prosecuting the case.
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Doctor Pleads Guilty to Obstructing the IRSRead the Press Release
A medical doctor pleaded guilty to corruptly obstructing the due administration of the internal revenue laws yesterday, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and United States Attorney for the Middle District of North Carolina Matthew G.T. Martin.
According to court documents, Dr. Joseph Jacob Hummel purchased the home of an acquaintance, only to be repaid for the purchase a short time later. When Special Agents with Internal Revenue Service-Criminal Investigation (IRS) interviewed Dr. Hummel about this real estate transaction, he falsely stated that he rented the property to the original owner and then sent the agents a sham lease, supporting this statement.
Hummel faces a maximum sentence of three years in prison. He also faces a period of supervised release and monetary penalties. Sentencing is scheduled for March 26, 2019.
Principal Deputy Assistant Attorney General Zuckerman and United States Attorney Martin thanked special agents of IRS-Criminal Investigation, who conducted the investigation, and Trial Attorney Kevin Schneider of the Tax Division and Assistant United States Attorney Frank Chut, who are prosecuting the case.
Former Federal Contractors Plead Guilty to Federal Contract Fraud ConspiracyRead the Press Release
George Patton and Henry Patton both pleaded guilty yesterday to conspiring to defraud the United States, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina. George Patton also pleaded guilty to evading payment of his individual income taxes.
According to documents filed with the court, George Patton owned businesses that were registered to do business with the federal government, but he was eventually debarred from conducting such business. During this time, George Patton, his wife, Lindsey Patton, and his brother, Henry Patton then conspired to form new contracting businesses for which Lindsey Patton and Henry Patton acted as nominee owners, but which George Patton controlled. Under this arrangement, the conspirators obtained federal contracts totaling over $10 million. In order to conceal the income that he earned from the businesses, George Patton instructed his co-conspirators first to deposit funds from the businesses into bank accounts in their names and then transfer the funds to him. George Patton further concealed his income by directing his co-conspirators to deposit the funds in amounts less than $10,000 to evade currency-reporting requirements.
George Patton and Lindsey Patton filed income tax returns for the 2006 through 2008 and 2013 tax years, which reported approximately $61,000 in taxes, which they have evaded paying. The total tax loss associated with their conduct, including penalties and interest, is over $107,000.
Lindsey Patton pleaded guilty on November 9, 2018 to conspiring to defraud the United States and to evading payment of her individual income taxes.
Sentencing for George Patton and Henry Patton is scheduled for March 18, 2019. Sentencing for Lindsey Patton is scheduled for February 27, 2019. George Patton and Lindsey Patton each face a maximum sentence of eight years in prison, as well as a period of supervised release, restitution, and monetary penalties. Henry Patton faces a maximum of five years in prison, a period of supervised release, restitution, and monetary penalties.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Martin commended special agents of IRS-Criminal Investigation, the Department of the Interior, and the Department of Defense Office of Inspector General, who investigated the case, and United States Assistant Attorney Anand Ramaswamy and Trial Attorney Alexander Effendi of the Tax Division, who are prosecuting this case.
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Former Federal Contractors Plead Guilty to Federal Contract Fraud ConspiracyRead the Press Release
George Patton and Henry Patton both pleaded guilty yesterday to conspiring to defraud the United States, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina. George Patton also pleaded guilty to evading payment of his individual income taxes.
According to documents filed with the court, George Patton owned businesses that were registered to do business with the federal government, but he was eventually debarred from conducting such business. During this time, George Patton, his wife, Lindsey Patton, and his brother, Henry Patton then conspired to form new contracting businesses for which Lindsey Patton and Henry Patton acted as nominee owners, but which George Patton controlled. Under this arrangement, the conspirators obtained federal contracts totaling over $10 million. In order to conceal the income that he earned from the businesses, George Patton instructed his co-conspirators first to deposit funds from the businesses into bank accounts in their names and then transfer the funds to him. George Patton further concealed his income by directing his co-conspirators to deposit the funds in amounts less than $10,000 to evade currency-reporting requirements.
George Patton and Lindsey Patton filed income tax returns for the 2006 through 2008 and 2013 tax years, which reported approximately $61,000 in taxes, which they have evaded paying. The total tax loss associated with their conduct, including penalties and interest, is over $107,000.
Lindsey Patton pleaded guilty on November 9, 2018 to conspiring to defraud the United States and to evading payment of her individual income taxes.
Sentencing for George Patton and Henry Patton is scheduled for March 18, 2019. Sentencing for Lindsey Patton is scheduled for February 27, 2019. George Patton and Lindsey Patton each face a maximum sentence of eight years in prison, as well as a period of supervised release, restitution, and monetary penalties. Henry Patton faces a maximum of five years in prison, a period of supervised release, restitution, and monetary penalties.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Martin commended special agents of IRS-Criminal Investigation, the Department of the Interior, and the Department of Defense Office of Inspector General, who investigated the case, and United States Assistant Attorney Anand Ramaswamy and Trial Attorney Alexander Effendi of the Tax Division, who are prosecuting this case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Laurinburg Man Sentenced to 50 Months in Prison for Possession of A Firearm by A Convicted FelonRead the Press Release
GREENSBORO, N.C. – A Laurinburg man who fled from police into an occupied home was sentenced to federal prison today, announced Matthew G.T. Martin, United States Attorney for the Middle District of North Carolina.
JERRY LEE ELLERBE JR. pleaded guilty on August 8, 2018, to possession of a firearm by a previously convicted felon. ELLERBE was sentenced byUnited States District JudgeWilliam L. Osteen Jr. to 50 months of imprisonment, followed by 3 years of supervised release.
On April 16, 2018, Laurinburg Police Sergeant Zachary Van Horn attempted to stop the car ELLERBE was driving, after seeing ELLERBE fail to observe a stop sign. ELLERBE did not stop when Sgt. Van Horn used his police blue lights and siren, and instead, took off at a high rate of speed, running through other stops signs and coming to a stop on a dead-end road. ELLERBE fled on foot into a wooded area near a residential neighborhood.
Sgt. Van Horn saw a woman outside a residence who told him that someone just ran inside her house. ELLERBE then came out of that house and was detained by police. Officers returned to the car from which ELLERBE fled and found a Glock .357 pistol on the driver’s seat, loaded with 15 rounds in the magazine and one round in the chamber. They also found marijuana, a digital scale, and pills.
ELLERBE had been convicted in Scotland County of felony possession with intent to sell and deliver marijuana, and was on supervised probation at the time he was encountered by Sgt. Van Horn.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Laurinburg Police Department, and prosecuted by Assistant United States Anand P. Ramaswamy for the Middle District of North Carolina.
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U.S. Attorney Matthew Martin Announces Progress in Making our Communities Safer through Project Safe Neighborhoods and PSN Grant FundingRead the Press Release
GREENSBORO, N.C. -- One year ago today, the Department of Justice announced the revitalization and enhancement of Project Safe Neighborhoods (PSN), which Attorney General Sessions has made the centerpiece of the Department’s violent crime reduction strategy. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
Throughout the past year, we have partnered with all levels of law enforcement, local organizations, and members of the community to reduce violent crime and make our neighborhoods safer for everyone.
The Department of Justice has also announced that the Middle District of North Carolina will receive $298,143 in PSN grant funding to strengthen PSN programs in this district.
“Project Safe Neighborhoods is a proven program with demonstrated results,” Attorney General Jeff Sessions said. “We know that the most effective strategy to reduce violent crime is based on sound policing policies that have proven effective over many years, which includes being targeted and responsive to community needs. I have empowered our United States Attorneys to focus enforcement efforts against the most violent criminals in their districts, and directed that they work together with federal, state, local, and tribal law enforcement and community partners to develop tailored solutions to the unique violent crime problems they face. Each United States Attorney has prioritized the PSN program, and I am confident that it will continue to reduce crime, save lives, and restore safety to our communities.”
“Over the past year, the data shows that PSN has contributed to a decrease in violent crime. Our local partners in each PSN site deserve tremendous credit. Where PSN is implemented properly, it has benefitted entire communities by identifying and punishing the most violent offenders and reducing the number of re-offenders by assisting persons released from prison to become productive members of society. The $300,000 grant will really help strengthen and expand our PSN programs,” U.S. Attorney Matthew G.T. Martin said.
Improvements to Community Safety
• The FBI’s official crime data for 2017 reflects that, after two consecutive, historic increases in violent crime, in the first year of the Trump Administration the nationwide violent crime rate began to decline. The nationwide violent crime rate decreased by approximately one percent in 2017, while the nationwide homicide rate decreased by nearly one and a half percent.
• The preliminary information DOJ has for 2018 gives reason for optimism that our efforts are continuing to pay off. Public data from 60 major cities show that violent crime was down by nearly five percent in those cities in the first six months of 2018 compared to the same period a year ago.
As of October 1, 2018, the Middle District of North Carolina has PSN programs in the following locations:
• Cabarrus County
• Davidson County
• Lee County
• Greensboro
• High Point
• Rockingham County
• Rowan County
• Winston-Salem
Several additional PSN sites are being developed in the Middle District of North Carolina.
History of The Middle District of North Carolina’s Pioneering Efforts in PSN
Some of the seeds of what became Project Safe Neighborhoods were first planted and took root here in the Middle District of North Carolina. In the late 1990’s, the Piedmont Triad was the site of a pioneering project in data-driven violence reductions efforts, starting in High Point, and then spreading to Winston-Salem and Greensboro by 2000. Principles of that initiative were incorporated into the U.S. Department of Justice’s National Project SAFE Neighborhoods gun and gang violence reduction strategy in 2001. Part of the strategy is the use of notification meetings, where repeat offenders on state supervision are called in and hear a two-part message: (1) stop the victimization and violence or you will be the focus of special attention for prosecution, and (2) partners in the community can offer assistance and services to those choosing to live within the law. Over 5,600 persons have been called in and heard that message in over 350 notification meetings in the Middle District of North Carolina since this program’s inception. There has been 20%-60% reduction in re-offending rates by those who go through notification, according to long-time research PSN partner, the University of North Carolina at Greensboro. Since 2001, across the Middle District, more than 50 law enforcement agencies have worked with nearly 200 community resource agencies using PSN strategies to reduce violent gun and gang crime.
These enforcement actions and partnerships are part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally based strategies to reduce violent crime.
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North Carolina Tax Return Preparer Sentenced to Prison for Preparing Fraudulent Tax ReturnsRead the Press Release
A Winston-Salem, North Carolina resident, who is also licensed as an attorney in Georgia, was sentenced today to 13 months in prison for aiding and assisting in the preparation of fraudulent tax return, announced Principal Deputy Assistant Attorney Richard Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina.
According to documents and information provided to the court, between January and May 2015, Shannon DeWayne Patterson co-owned and operated tax preparation businesses named “Fast Tax” in the cities of Winston-Salem, Salisbury and Kannapolis, North Carolina. Patterson instructed his employees to fabricate information on the tax returns they prepared, in an effort to increase the refunds paid to their clients. Because of his actions, more than $60,000 in fraudulent tax refunds were sought from the Internal Revenue Service (IRS). Patterson also filed false personal tax returns for 2014 and 2015, on which he underreported his income.
In addition to the term of imprisonment, Patterson was sentenced to one year of supervised release, and was also ordered to pay restitution in the amount of $60,800 to the IRS.
Two of Patterson’s Winston-Salem employees, Kristyn Dion Daney and Rakeem Scales, pleaded guilty in April to preparing a false tax return for an IRS undercover agent and are awaiting sentencing. Patterson’s co-owner in Fast Tax, Claudia Shivers, has also pleaded guilty to conspiring with Patterson and is awaiting sentencing.
Principal Deputy Assistant Attorney Zuckerman and U.S. Attorney Martin thanked special agents of IRS Criminal Investigation, who conducted the investigation, and former Tax Division Trial Attorney Robert J. Boudreau and Criminal Division Chief Clifton T. Barrett of the Middle District of North Carolina, who prosecuted the case.
Additional information about the Tax Division’s enforcement efforts can be found on the division’s website.
North Carolina Tax Return Preparer Sentenced to Prison for Preparing Fraudulent Tax ReturnsRead the Press Release
WASHINGTON - A Winston-Salem, North Carolina resident, who is also licensed as an attorney in Georgia, was sentenced today to 13 months in prison for aiding and assisting in the preparation of fraudulent tax return, announced Principal Deputy Assistant Attorney Richard Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina.
According to documents and information provided to the court, between January and May 2015, Shannon DeWayne Patterson co-owned and operated tax preparation businesses named “Fast Tax” in the cities of Winston-Salem, Salisbury and Kannapolis, North Carolina. Patterson instructed his employees to fabricate information on the tax returns they prepared, in an effort to increase the refunds paid to their clients. Because of his actions, more than $60,000 in fraudulent tax refunds were sought from the Internal Revenue Service (IRS). Patterson also filed false personal tax returns for 2014 and 2015, on which he underreported his income.
In addition to the term of imprisonment, Patterson was sentenced to one year of supervised release, and was also ordered to pay restitution in the amount of $60,800 to the IRS.
Two of Patterson’s Winston-Salem employees, Kristyn Dion Daney and Rakeem Scales, pleaded guilty in April to preparing a false tax return for an IRS undercover agent and are awaiting sentencing. Patterson’s co-owner in Fast Tax, Claudia Shivers, has also pleaded guilty to conspiring with Patterson and is awaiting sentencing.
Principal Deputy Assistant Attorney Zuckerman and U.S. Attorney Martin thanked special agents of IRS Criminal Investigation, who conducted the investigation, and former Tax Division Trial Attorney Robert J. Boudreau and Criminal Division Chief Clifton T. Barrett of the Middle District of North Carolina, who prosecuted the case.
Additional information about the Tax Division’s enforcement efforts can be found on the division’s website.
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Two Individuals Associated with a Mental Health Company Plead Guilty to Health Care Fraud and Tax EvasionRead the Press Release
Two individuals associated with a mental health company pleaded guilty to health care fraud related to the submission of false claims to Medicaid and tax evasion, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman and U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina.
Haydn Thomas, 44, formerly of Durham, North Carolina, pleaded guilty today to one count of making a false statement relating to health care matters and one count of tax evasion. Catinia Farrington, 44, also formerly of Durham, pleaded guilty yesterday to one count of health care fraud conspiracy and one count of tax evasion.
According to documents and information provided to the court, Farrington owned Durham County Mental Health and Behavioral Health Services, LLC (“DCMBHS”) in Durham. Farrington submitted false claims to Medicaid for mental health services that were not performed. From 2011 through 2015, Farrington submitted thousands of false claims to Medicaid that resulted in Medicaid paying approximately $4 million to DCMBHS. Also during the relevant period, Thomas worked as the practice manager for an oral surgeon and provided Farrington with name and Medicaid number of a dental patient, causing the filing of a false medical claim.
Farrington and Thomas diverted millions of dollars from DCMBHS for their own personal use and evaded income taxes by, among other things, transferring money to various business bank accounts and paying personal expenses from the business bank accounts.
The sentencing hearing for Farrington has been set for February 15, 2019. The sentencing hearing for Thomas has been set for February 21, 2019. Farrington faces a statutory maximum sentence of 10 years in prison for conspiracy to commit health care fraud and five years in prison for tax evasion. Thomas faces five years in prison for making a false statement relating to health care matters and five years in prison for tax evasion. Farrington and Thomas also face a period of supervised release, restitution, and monetary penalties.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Martin commended special agents of the Internal Revenue Service, the U.S. Department of Health and Human Service, Office of Inspector General, and the Medicaid Investigations Division of the North Carolina Attorney General’s Office (MID), who conducted the investigation, and Assistant U.S. Attorney Robert Hamilton, Trial Attorney Mara Strier of the Tax Division, and Special Assistant U.S. Attorney Michael Heavner of MID, who are prosecuting the case.
Two Individuals Associated with A Mental Health Company Plead Guilty to Health Care Fraud and Tax EvasionRead the Press Release
WASHINGTON - Two individuals associated with a mental health company pleaded guilty to health care fraud related to the submission of false claims to Medicaid and tax evasion, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman and U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina.
Haydn Thomas, 44, formerly of Durham, North Carolina, pleaded guilty today to one count of making a false statement relating to health care matters and one count of tax evasion. Catinia Farrington, 44, also formerly of Durham, pleaded guilty yesterday to one count of health care fraud conspiracy and one count of tax evasion.
According to documents and information provided to the court, Farrington owned Durham County Mental Health and Behavioral Health Services, LLC (“DCMBHS”) in Durham. Farrington submitted false claims to Medicaid for mental health services that were not performed. From 2011 through 2015, Farrington submitted thousands of false claims to Medicaid that resulted in Medicaid paying approximately $4 million to DCMBHS. Also during the relevant period, Thomas worked as the practice manager for an oral surgeon and provided Farrington with name and Medicaid number of a dental patient, causing the filing of a false medical claim.
Farrington and Thomas diverted millions of dollars from DCMBHS for their own personal use and evaded income taxes by, among other things, transferring money to various business bank accounts and paying personal expenses from the business bank accounts.
The sentencing hearing for Farrington has been set for February 15, 2019. The sentencing hearing for Thomas has been set for February 21, 2019. Farrington faces a statutory maximum sentence of 10 years in prison for conspiracy to commit health care fraud and five years in prison for tax evasion. Thomas faces five years in prison for making a false statement relating to health care matters and five years in prison for tax evasion. Farrington and Thomas also face a period of supervised release, restitution, and monetary penalties.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Martin commended special agents of the Internal Revenue Service, the U.S. Department of Health and Human Service, Office of Inspector General, and the Medicaid Investigations Division of the North Carolina Attorney General’s Office (MID), who conducted the investigation, and Assistant U.S. Attorney Robert Hamilton, Trial Attorney Mara Strier of the Tax Division, and Special Assistant U.S. Attorney Michael Heavner of MID, who are prosecuting the case.
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Kernersville Man Sentenced in Child Pornography CaseRead the Press Release
GREENSBORO, N.C. – A Kernersville man who pleaded guilty to receipt of child pornography was sentenced today, announced Matthew G.T. Martin, United States Attorney for the Middle District of North Carolina.
WILLIAM MICHAEL FOURES, 45, of Kernersville, North Carolina, pleaded guilty on March 8, 2018, to one count of receipt of child pornography. He was sentenced by United States District Judge N. Carlton Tilley, Jr. to 78 months of imprisonment followed by 25 years of supervised release.
In May 2017, Kernersville Police Department received a tip that FOURES possessed child pornography on his laptop computer. Police questioned FOURES and, with his permission, reviewed his web browser history. They then obtained a search warrant for his residence. The subsequent search revealed that FOURES possessed well over 1,000 image and numerous video files depicting child pornography. The files were stored on two laptops and 70 CDs. In addition, FOURES had used his printer to print over 100 of the child pornography images. When questioned, FOURES admitted to possessing the contraband for his sexual gratification.
This case was investigated by the Kernersville Police Department, a member of the North Carolina Internet Crimes Against Children (ICAC) Task Force. The North Carolina State Bureau of Investigation conducted computer forensic analysis on the electronics seized and Homeland Security Investigations adopted the case for federal prosecution. The case was prosecuted by Assistant United States Attorney Eric L. Iverson.
The case was brought as part of Project Safe Childhood, a nationwide initiative by the Department of Justice to combat online child sexual exploitation and abuse. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
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Two Men Sentenced for Gas Pump Card Skimming Bank Fraud Scheme Following Their Arrest in Salisbury, NCRead the Press Release
GREENSBORO, N.C. – Two men who were arrested last September in Salisbury, North Carolina, in a gas pump credit and debit card-skimming investigation were sentenced to federal prison today, announced Matthew G.T. Martin, United States Attorney for the Middle District of North Carolina.
ELIO ARTURO RODRIGUEZ-MENDEZ of Miami, Florida, and JEAN JESUS RODRIGUEZ-SILVA of Louisville, Kentucky, both pleaded guilty on May 10, 2018, to one count of conspiracy to commit bank fraud. Each was sentenced by United States District Judge William L. Osteen, Jr., to 33 months of imprisonment, followed by 3 years of supervised release. They were also ordered to pay $21,931.09 in restitution.
Authorities began investigating the fraud following a fraud victim’s complaint. By tracing the use of the stolen card information, the Rowan County Sheriff’s Office identified two men on store security footage at various Walmart stores associated with purchases using that victim’s card and other cards. That surveillance also showed the two men consistently arrived and left the stores in a silver pick-up truck with Florida license plates. On September 7, 2017, an officer saw a pick-up truck matching that description and followed it to a hotel in Salisbury. The officer recognized one of the persons in the vehicle as a person seen on surveillance video associated with the credit/debit card fraud. Officers stopped the pick-up truck after it left the hotel. The driver was RODRIGUEZ-MENDEZ, 47, with passenger RODRIGUEZ-SILVA, 33. The pair was found to possess devices commonly found in card-skimming activity conducted at gas pumps. Most of the victims had patronized stations in Rockwell and Salisbury. A GPS unit in RODRIGUEZ-MENDEZ’S truck showed it had once stopped at the station in Rockwell while the station was closed, and an audio-recording recovered from the GPS unit captured persons apparently discussing, in Spanish, the proper way to install a gas pump card-skimming device.
This case was investigated by the United States Secret Service and the Rowan County Sheriff’s Office, and prosecuted by Assistant United States Anand P. Ramaswamy, Cybercrime Prosecutor for the Middle District of North Carolina.
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Two Men Sentenced for Separate Incidents of Attempting to Sexually Exploit Minors OnlineRead the Press Release
GREENSBORO, N.C. – Two men who, in separate incidents, attempted to entice minors to engage in sexual activity were sentenced today, announced Matthew G.T. Martin, United States Attorney for the Middle District of North Carolina.
CHRISTOPHER JAMES WILSON, 36, of Cana, Virginia, pleaded guilty on April 9 2018, to one count of enticement of a minor and one count of attempted enticement of a minor. He was sentenced by United States District Judge Loretta Copeland Biggs to 250 months of imprisonment, followed by 20 years of supervised release.
When WILSON committed the federal offense last year, he had twice been convicted of state sex offenses against minors, in 2003 and 2006, and was already a registered sex offender. In June 2017, a Stokes County mother reported that WILSON used Facebook to send her 12-year-old daughter a picture of WILSON’S genitalia, and a request that the girl send WILSON nude images of herself. Stokes County Deputy Sheriff Christopher Lawson received permission to take over the minor’s account in an undercover capacity, and Investigator Lawson then communicated with WILSON from June 15, 2017 to August 4, 2017. The messages WILSON sent to what he believed to be the 12-year-old girl contained sexually explicit content and direction to engage in sexual activity.
This case was investigated by the Stokes County Sheriff’s Office, a member of the North Carolina Internet Crimes Against Children (ICAC) Task Force.
ADRIAN RODRIGUEZ, 33, of Jamestown, North Carolina, pleaded guilty on April 9 2018, to one count of attempted enticement of a minor. He was sentenced by United States District Judge Loretta Copeland Biggs to 151 months of imprisonment, followed by 10 years of supervised release.
RODRIGUEZ was identified by the Alamance County Sheriff’s Office during an undercover operation on a social media messaging application popular with minors. In March 2017, Deputy Sheriff Zachary Neefe created an undercover persona of a 13-year-old girl from Alamance County and joined a teen chat group. RODRIGUEZ later sent direct-messages to this 13-year-old girl persona and, over the course of several days, RODRIGUEZ repeatedly expressed his desire to perform sexual acts with what he believed to be the 13-year-old. RODRIGUEZ planned to meet the minor on March 21, 2017, for the purpose of engaging in sex acts. When RODRIGUEZ arrived in Alamance County, he was arrested by investigators. A subsequent examination of RODRIGUEZ’S phone revealed that he possessed approximately 40 videos containing child pornography, and had recently engaged in numerous sexual chats with individuals who purported to be minors.
This case was investigated by the Alamance County Sheriff’s Office, a member of the North Carolina Internet Crimes Against Children (ICAC) Task Force. Homeland Security Investigations assisted with the identification of victims.
These cases were prosecuted by Assistant United States Attorney Eric L. Iverson and were brought as part of Project Safe Childhood, a nationwide initiative by the Department of Justice to combat online child sexual exploitation and abuse. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
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North Carolina Tax Return Preparer Pleads Guilty to Conspiring to File False Tax ReturnsRead the Press Release
A Winston-Salem, North Carolina resident pleaded guilty today to conspiring to defraud the United States by filing false tax returns, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Matthew G. T. Martin of the Middle District of North Carolina.
According to court documents, Claudia Lynette Shivers conspired with others to defraud the Internal Revenue Service (IRS) by preparing false tax returns. Shivers co-owned and operated two tax return preparation businesses: Fast Tax of Winston-Salem, Inc. in Winston-Salem and Quick Taxes LLC in Greensboro. Shivers and her co-conspirators falsified items on clients’ tax returns, such as dependents and Schedule A deductions, in order to fraudulently maximize their refunds. Shivers also directed clients to hand-write false information on tax forms and other documents used in the preparation of their returns. Shivers further admitted that she held training sessions for her employees, during which she would instruct them on how to manipulate the information on tax returns in order to obtain refunds to which the clients were not entitled. Between January 2014 and April 2017, Shivers and her co-conspirators prepared approximately 519 false tax returns, which claimed approximately $1.3 million in bogus refunds.
Shivers’ sentencing is scheduled for December 20, 2018. Shivers faces a statutory maximum sentence of five years in prison, as well as a period of supervised release, restitution and monetary penalties.
Shiver’s co-conspirators, Shannon DeWayne Patterson, Kristyn Dion Daney, and Rakeem Lenell Scales, have all pleaded guilty to charges of aiding and assisting in the preparation of false tax returns and are awaiting sentencing.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Martin commended special agents of IRS Criminal Investigation, who conducted the investigation, and Trial Attorneys Robert J. Boudreau and Lauren Castaldi of the Tax Division and Criminal Division Chief Clifton T. Barrett of the Middle District of North Carolina, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
North Carolina Tax Return Preparer Pleads Guilty to Conspiring to File False Tax ReturnsRead the Press Release
WASHINGTON – A Winston-Salem, North Carolina resident pleaded guilty today to conspiring to defraud the United States by filing false tax returns, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Matthew G. T. Martin of the Middle District of North Carolina.
According to court documents, Claudia Lynette Shivers conspired with others to defraud the Internal Revenue Service (IRS) by preparing false tax returns. Shivers co-owned and operated two tax return preparation businesses: Fast Tax of Winston-Salem, Inc. in Winston-Salem and Quick Taxes LLC in Greensboro. Shivers and her co-conspirators falsified items on clients’ tax returns, such as dependents and Schedule A deductions, in order to fraudulently maximize their refunds. Shivers also directed clients to hand-write false information on tax forms and other documents used in the preparation of their returns. Shivers further admitted that she held training sessions for her employees, during which she would instruct them on how to manipulate the information on tax returns in order to obtain refunds to which the clients were not entitled. Between January 2014 and April 2017, Shivers and her co-conspirators prepared approximately 519 false tax returns, which claimed approximately $1.3 million in bogus refunds.
Shivers’ sentencing is scheduled for December 20, 2018. Shivers faces a statutory maximum sentence of five years in prison, as well as a period of supervised release, restitution and monetary penalties.
Shiver’s co-conspirators, Shannon DeWayne Patterson, Kristyn Dion Daney, and Rakeem Lenell Scales, have all pleaded guilty to charges of aiding and assisting in the preparation of false tax returns and are awaiting sentencing.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Martin commended special agents of IRS Criminal Investigation, who conducted the investigation, and Trial Attorneys Robert J. Boudreau and Lauren Castaldi of the Tax Division and Criminal Division Chief Clifton T. Barrett of the Middle District of North Carolina, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
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North Carolina Man Sentenced to Prison for Role in Multi-State Dog Fighting ProsecutionRead the Press Release
WASHINGTON - A North Carolina man was sentenced yesterday to one year and one day in prison to be followed by three years of supervised release for his role in dog fighting activities, announced Acting Assistant Attorney General Jeffrey H. Wood of the Justice Department’s Environment and Natural Resources Division, U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina and Special Agent in Charge Bethanne M. Dinkins for the U.S. Department of Agriculture’s Office of Inspector General.
On Jan. 12, Brexton Redell Lloyd, 54, of Eagle Springs, North Carolina, pleaded guilty to one felony count of conspiracy and two felony counts of possession and training a dog intended for use in an animal fighting venture, contrary to the animal fighting provisions of the federal Animal Welfare Act.
According to documents filed with the court, Lloyd participated with Justin “Jay” Love and others in a multi-state dog fighting conspiracy. These documents describe Lloyd and Love’s attempt to set up a dog fight between Lloyd and an unknown opponent in October 2015 and Lloyd’s breeding and training activities. Court documents further note that last year, federal agents seized 13 pitbull-type dogs from Lloyd’s residence. Ten of the dogs were secured outdoors by excessive chains, wearing thick collars, and positioned so that each dog was out of reach of any other dog. The other dogs were housed individually in pens. The water in the dogs’ bowls was frozen. Two of the four adult dogs seized exhibited scars consistent with dog fighting, and a third adult dog had four fractured teeth. In addition to the dogs, agents seized items related to training dogs for dog fighting purposes, including: a spring pole, a dog harness, and a hanging scale. Agents also seized veterinary supplies, including intravenous fluids, intravenous administration sets stated for “Veterinary Use Only,” injectable and other antibiotics, a 100-count package of syringes, blood-clotting medications such as Blood Stop Powder, and a skin stapler.
“Animal cruelty like the conduct in this case has no place in a civilized society,” said Acting Assistant Attorney General Wood. “Yesterday’s sentencing sends a strong message that we are bringing to justice those who engage in illegal dog fighting and that anyone who engages in this conduct does so at the risk of significant jail time.”
“Dog fighting isn’t entertainment, it’s organized crime, and it has no place in our society,” said United States Attorney Matthew G.T. Martin for the Middle District of North Carolina. Martin added, “I thank our law enforcement partners at the Department of Agriculture, the Federal Bureau of Investigation, the Moore County Sheriff’s Office, and the N.C. State Highway Patrol for their exceptional coordination in bringing this defendant to justice.”
“The provisions of the Animal Welfare Act were designed to protect animals from being used in illegal fighting ventures, which often entail other forms of criminal activity involving drugs, firearms and gambling,” said Special Agent in Charge Dinkins for USDA OIG. “Together with the Department of Justice, animal fighting is an investigative priority for USDA OIG, and we will work with our law enforcement partners to investigate and assist in the criminal prosecution of those who participate in animal fighting ventures.”
This case is part of Operation Grand Champion, a coordinated effort across numerous federal judicial districts to combat organized dog fighting. The phrase “Grand Champion” is used by dog fighters to refer to a dog with more than five dog fighting “victories.” To date, over one hundred dogs have been rescued as part of Operation Grand Champion, and either surrendered or forfeited to the government. The Humane Society of the United States assisted with the care of the dogs seized by federal law enforcement.
This case was investigated by USDA OIG and FBI, with assistance from the Moore County Sheriff’s Office and the North Carolina Highway Patrol, and was prosecuted by Trial Attorney Erica H. Pencak of the Justice Department’s Environmental Crimes Section and Assistant U.S. Attorney JoAnna G. McFadden of the Middle District of North Carolina.
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Lee County Man Receives Ten Year Sentence in Child Pornography CaseRead the Press Release
GREENSBORO, N.C. – A Sanford man who pleaded guilty to possession of child pornography was sentenced to ten years’ imprisonment today, announced Matthew G.T. Martin, United States Attorney for the Middle District of North Carolina.
SCOTT SAMUEL YOUNG, 28, of Sanford, North Carolina, pleaded guilty on March 8, 2018, to one count of possession of child pornography. He was sentenced to 120 months of imprisonment followed by 20 years of supervised release by United States District Judge N. Carlton Tilley, Jr.
YOUNG had previously been convicted of a state child pornography offense in Lee County Superior Court on January 20, 2016, under the alias Justin Presendorf. In August 2016, the N.C. State Bureau of Investigation (SBI) received a report from the National Center for Missing and Exploited Children that a certain Dropbox cloud storage account was being used to store and access child pornography. The SBI identified YOUNG as the user of that Dropbox account, based on the IP addresses and email address used, and the fact that no one had logged into the Dropbox account during the time YOUNG had been incarcerated for his state conviction. That cloud storage account contained 2,020 images and 135 videos of child pornography.
On September 9, 2016, investigators seized a phone found in YOUNG’S possession and arrested him after determining that the phone contained child pornography. Investigators found 369 images and 174 videos of child pornography on the phone.
This case was investigated by the Lee County Sheriff’s Office and North Carolina State Bureau of Investigation. Both agencies are members of the North Carolina Internet Crimes Against Children (ICAC) Task Force. The case was prosecuted by Assistant United States Attorney Eric L. Iverson.
It was brought as part of Project Safe Childhood, a nationwide initiative by the Department of Justice to combat online child sexual exploitation and abuse. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
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Six Richmond County, North Carolina Residents Indicted for Firearm, Drug, and Robbery OffensesRead the Press Release
GREENSBORO, N.C. – A grand jury sitting in Greensboro, North Carolina last week returned five indictments charging six Richmond County, North Carolina men on charges including possession of a firearm by a convicted felon, drug distribution, and Hobbs Act robbery. All six were arrested and had initial court appearances on July 2.
These cases are the most recent resulting from a coordinated effort among federal, state, and local law enforcement intended to reduce violent and gun-related crime in the Richmond County area, announced U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina.
In 2017, security concerns prompted the City of Hamlet, North Carolina, to abruptly cancel its July 4th festivities. News of the 2017 Hamlet July 4th cancellation garnered public attention, and Attorney General Sessions, speaking at a gang conference in Winston-Salem on Aug. 17, 2017, remarked, “I heard recently about Hamlet, North Carolina, where this year’s annual Independence Day celebration was canceled suddenly because of threats of gang violence. This is in a town of about 7,000 people. I certainly respect the decision of the city leaders, but it is infuriating and wrong to me that they had to make it. This is America. We will not be held hostage in our homes by gangsters.”
Since then, a total of 25 defendants from Richmond County, including the six arrested today, have been charged in U.S. District Court for the Middle District of North Carolina, and the federal and local law enforcement coordination continues.
“Federal prosecutors and agents have worked diligently with our law enforcement partners in Richmond County to ensure that fear of criminal activity does not control citizens’ enjoyment of their fundamental freedoms on Independence Day or any other day,” said U.S. Attorney Martin, “and we plan to maintain our focus on Richmond County long after the fireworks end. Thank you to Sheriff Clemmons, Chief Waters, Chief Kelly, and the other state and federal agents for their coordination and continuing hard work.”
On June 25, the grand jury returned indictments against six individuals including:
• Quandon Ha’son Wilson, 26, and Devion Marquis Ward, 22, both of Rockingham, North Carolina, were charged with one count of obstructing, delaying, and affecting commerce and the movement of any article and commodity in commerce, by robbery or extortion in connection with the robbery of Duncan’s Food Store in Rockingham on Jan. 8. Wilson and Ward are also charged with one count of using, carrying, or possessing a firearm during and in relation to a crime of violence;
• Quiteraus Dequan Gardner, 22, of Hamlet, North Carolina, was charged with one count of felon in possession of a firearm;
• Sajuan Deangelo Leslie, 29, of Rockingham, was charged with one count of felon in possession of a firearm;
• Trevon Ibe-Deonte Leslie, 23, of Rockingham, was charged with one count of felon in possession of a firearm, one count of possession with intent to distribute marijuana, and one count of using, carrying, or possessing a firearm during and in relation to a drug trafficking crime; and
• Hikeem Idrise-Lamar Byrd, 24, of Rockingham, was charged in a four-count indictment with one count of conspiracy to distribute and possess with intent to distribute 28 grams of more of cocaine base; two counts of possession with intent to distribute cocaine base, and one count of felon in possession of a firearm.
An indictment is merely an allegation, and a defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
In addition to the six individuals indicted this month, 19 others from Richmond County, have been charged with drug and firearm offenses in U.S. District Court for the Middle District of North Carolina since July 2017. Five defendants charged in a methamphetamine conspiracy in July 2017 (Landon Hair, Charles Goodwin, Mark Rosberg, Windell Strickland, and Bryan Smith) were convicted and sentenced to terms of imprisonment ranging from 60 to 82 months. Kevin Mack was convicted in a separate methamphetamine case and sentenced to 60 months in prison. Walter Little and Everette Smith were both sentenced after being convicted of felon in possession of a firearm. Little was sentenced to 120 months in prison, and Smith was sentenced to 69 months in prison. Three defendants - Justin Beck, Rondell McNair, and Devon Stanback – are fugitives. The remaining defendants are pending trial or sentencing.
The cases indicted this month were investigated by the Hamlet Police Department, Rockingham Police Department, Richmond County Sheriff’s Office, North Carolina Department of Public Safety, FBI, and Bureau of Alcohol, Tobacco, Firearms and Explosives. Federal law enforcement officials are also grateful to Assistant District Attorneys from the Richmond County District Attorney’s Office for their assistance. The June indictments are being prosecuted by Trial Attorneys of the Criminal Division of the U.S. Department of Justice and the U.S. Attorney’s Office for the Middle District of North Carolina.
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Alamance County Man Sentenced on Child Pornography ChargeRead the Press Release
GREENSBORO, N.C. – A Snow Camp man who pleaded guilty to receipt of child pornography was sentenced today, announced Matthew G.T. Martin, United States Attorney for the Middle District of North Carolina.
SAMUEL DEXTER RAY, 60, of Snow Camp, North Carolina, pleaded guilty on February 27, 2018, to one count of receipt of child pornography. He was sentenced by Chief United States District Judge Thomas D. Schroeder to 78 months of imprisonment followed by 8 years of supervised release. RAY was also ordered to pay $10,000 in restitution.
Investigators searched RAY’S home on September 15, 2017 and seized several of his electronic devices. They ultimately found thousands of child pornography files on RAY’s laptop and storage devices. RAY downloaded the child pornography from the “dark web” and peer-to-peer file-sharing networks.
This case was investigated by the Alamance County Sheriff’s Office, a member of the North Carolina Internet Crimes Against Children (ICAC) Task Force and the Federal Bureau of Investigation. The case was prosecuted by Assistant United States Attorney Eric L. Iverson.
It was brought as part of Project Safe Childhood, a nationwide initiative by the Department of Justice to combat online child sexual exploitation and abuse. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
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Lee County Project Safe Neighborhood Program Yields Guilty Plea, Sentencing, of Repeat Offenders for Federal Firearms ViolationsRead the Press Release
Greensboro, N.C. – One Lee County man pleaded guilty to possession of a firearm by a convicted felon and possession of a firearm with an altered or obliterated serial number, and another Lee County man was sentenced for possession of ammunition by a convicted felon, announced United States Attorney Matthew G.T. Martin. These cases resulted from close federal and local coordination through the Lee County Project Safe Neighborhoods (“PSN”) program, which is intended to reduce violent and gun-related crime.
On June 11, 2018, Teon Shamal La’Shane Douglas, age 22, of Sanford, N.C., pleaded guilty before the Honorable Thomas D. Schroeder, Chief United States District Judge, to a violation of 18 U.S.C. § 922(g)(1), which makes it a federal crime for a previously convicted felon to possess a firearm or ammunition, and to a violation of 18 U.S.C. § 922(k), which makes it a federal crime to possess a firearm with a removed, altered, and/or obliterated manufacturer’s serial number.
As set forth in the factual basis filed in support of Douglas’s plea of guilty, on June 11, 2017, officers with the Sanford Police Department were on routine patrol when they pulled Douglas over for speeding. After smelling the odor of marihuana in the car, officers searched it and discovered a Walther handgun and a Sig Sauer handgun. Douglas had multiple previous convictions, including a 2016 conviction for Felony Possession with Intent to Manufacture/Sell/Deliver a Scheduled II Controlled Substance. On November 28, 2017, officers with the Lee County Sheriff’s Office pulled a car over with no registration plates. Douglas was a passenger in the car. After smelling the odor of marihuana in the car, officers searched the car and its occupants. They found a Ravens Arms pistol in the car and a second Ravens Arm pistol with an altered serial number in Douglas’s pants.
Douglas faces a maximum term of imprisonment of ten years for the first violation and a maximum term of imprisonment of five years for the second violation. The Court may also impose a term of supervised release of up to three years, a maximum fine of $250,000, and a special assessment fee of $100.00, for each violation. Douglas will be sentenced on September 18, 2018 at 2 p.m. in Winston-Salem Courtroom Two.
On June 15, 2018, Diante Tyrell Roberson, age 20, of Sanford, N.C., was sentenced by the Honorable N. Carlton Tilley, Jr., Senior United States District Judge, to imprisonment for thirty months, followed by three years supervised release and a $100.00 special assessment fee. On March 8, 2016, Roberson pleaded guilty to a violation of 18 U.S.C. § 922(g)(1), which makes it a federal crime for a previously convicted felon to possess a firearm or ammunition.
On July 6, 2017, officers with the Lee County Sheriff’s Office responded to a 911 call from a home in Sanford, N.C., reporting the shooting of a dog. Through the investigation, officers determined that Roberson had come to the home after midnight that evening and sent text messages to one of its occupants that threatened violence if she did not let him into the home. When the occupant would not come to the door, Roberson shot and killed a pet dog in the yard in retaliation. A 9mm shell casing was located near the corpse of the dog. Roberson had a 2017 conviction for Felony Accessory After the Fact related to a robbery.
These two matters are the result of close cooperation among members of the Lee County PSN coalition. PSN is a data-driven, nationwide Department of Justice coordinated gun and violent crime strategy designed to protect communities. The Lee County PSN coalition is comprised of the Sanford Police Department, the Lee County Sheriff’s Office, the Broadway Police Department, the Department of Public Safety Division of Adult Correction and Juvenile Justice (probation), the State Bureau of Investigation, the District Attorney’s Office for the 11A Prosecutorial District, the Federal Bureau of Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the United States Attorney’s Office, and many other community members and agencies.
These cases were investigated by the Sanford Police Department, the Lee County Sheriff’s Office, and the Bureau of Alcohol, Tobacco, Firearms and Explosives. The cases were prosecuted by Assistant United States Attorney JoAnna G. McFadden.
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Operators of A Mental Health Provider Indicted on Health Care Fraud and Tax Evasion ChargesRead the Press Release
GREENSBORO, N.C. – A federal grand jury sitting in Greensboro, North Carolina returned an indictment, which was unsealed today, charging the operators of a mental health provider with multiple crimes related to the submission of false claims to Medicaid and tax evasion, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman and U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina.
Catinia Denise Farrington, age 44, and Haydn Patrick Thomas, age 44, both formerly of Durham, North Carolina, are charged with conspiracy to commit health care fraud, health care fraud, aggravated identity theft, and tax evasion. Thomas is also charged with one count of money laundering.
According to the indictment, Farrington owned Durham County Mental Health and Behavioral Health Services, LLC (“DCMBHS”) in Durham, North Carolina. From 2011 through 2015, Farrington, along with Thomas, allegedly submitted thousands of false claims to Medicaid that resulted in Medicaid paying over $4 million to DCMBHS. During the relevant period, Thomas worked as an office manager for an oral surgeon. Thomas and Farrington allegedly obtained the Medicaid numbers of dental patients and then submitted false claims to Medicaid for mental health services that were not performed without the permission of the patients.
The indictment further alleges that Farrington and Thomas diverted millions of dollars from DCMBHS for their own personal use and evaded income taxes by, among other things, transferring money to various business bank accounts and paying personal expenses from the business bank accounts.
If convicted, Farrington and Thomas face a statutory maximum of 10 years in prison for each count of health care fraud, 10 years in prison for conspiracy to commit health care fraud, two years in prison for each count of aggravated identity theft, and five years in prison for each count of tax evasion. Farrington and Thomas also face a period of supervised release, restitution, and monetary penalties.
An indictment is merely an allegation, and a defendant is presumed innocent unless and until proven guilty.
Principal Deputy Assistant Attorney General Zuckerman and United States Attorney Martin commended special agents of the Internal Revenue Service Criminal Investigation Division, the U.S. Department of Health and Human Service, Office of Inspector General, and the Medicaid Investigations Division of the North Carolina Attorney General’s Office (MID), who conducted the investigation, and Assistant United States Attorney Robert Hamilton, Trial Attorney Mara Strier of the Tax Division, and Special United States Attorney Michael Heavner with MID, who are prosecuting the case.
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Tax Return Preparer Arrested for Conspiring to Defraud the United States by Filing False Tax ReturnsRead the Press Release
GREENSBORO, N.C. – A Winston-Salem resident was arrested today on charges of tax fraud, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Matthew G.T. Martin of the Middle District of North Carolina.
According to the indictment, which was unsealed today, Claudia Lynette Shivers (“Shivers”) conspired with Shannon DeWayne Patterson (“Patterson”), Kristyn Dion Daney (“Daney”), Rakeem Lenell Scales (“Scales”) and others to defraud the government by preparing false tax returns. Shivers co-owned and operated tax return preparation businesses named Fast Tax of Winston-Salem, Inc. (“Fast Tax”) in Winston-Salem and Quick Taxes LLC (“Quick Taxes”) in Greensboro. Shivers and her co-conspirators agreed to falsify items on clients’ tax returns in order to maximize their refunds. As part of their scheme, Shivers and her co-conspirators would direct clients to hand-write false information on tax forms and other documents to create a false record of information provided to Fast Tax and Quick Taxes for the preparation of the clients’ tax returns. Shivers is also charged with aiding and assisting in the preparation of false tax returns for several clients, as well as filing a false 2014 tax return for herself on which she failed to report all of her income.
An indictment merely alleges that crimes have been committed and the defendant is presumed innocent until proved guilty beyond a reasonable doubt.
If convicted, Shivers faces a statutory maximum sentence of five years in prison for the conspiracy count, three years in prison for each count of preparing false tax returns for clients, and three years in prison for the count of filing her own false tax return. She also faces a period of supervised release, restitution and monetary penalties. Patterson, Daney and Scales have all pled guilty to charges of aiding and assisting in the preparation of false tax returns, and are awaiting sentencing. Each faces a statutory maximum sentence of three years in prison, a period of supervised release, restitution and monetary penalties.
“We will prosecute those who cheat on their taxes and those who coach others to cheat on their taxes. It harms all tax-payers and threatens the integrity of our system,” stated U.S. Attorney Martin.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Martin commended special agents of IRS Criminal Investigation, who conducted the investigation, and Trial Attorney Robert J. Boudreau of the Tax Division and Criminal Division Chief Clifton T. Barrett of the Middle District of North Carolina, who are prosecuting the case. Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
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Defendant Sentenced for Firearm Possession in Road Rage IncidentRead the Press Release
Greensboro, N.C. – United States Attorney Matthew G.T. Martin of the Middle District of North Carolina announced that Billy Ray Dickerson, Jr. was sentenced to 92 months confinement on May 15, 2018, by the Honorable Judge Thomas D. Schroeder for felon in possession of a firearm.
According to court documents, Dickerson, age 46, of Butner, North Carolina, was driving a plumbing van in Durham on April 4, 2017, when he aggressively tailgated another vehicle. The other driver pulled over to let Dickerson pass. Instead, Dickerson pulled beside the man, threatened to “send him to his maker,” and called him a racial slur several times before pulling out a handgun and firing it as the other driver sped off.
Dickerson then wrecked into another vehicle and was seen throwing items in the back of the van. A Davis Industries .380 caliber pistol, model P-380 was located in the back of the van. Dickerson was arrested that day on several related state charges. Before a search warrant could be executed to retrieve evidence of gunshot residue from his hands, Dickerson urinated on the floor and rubbed his hands in the urine, in an unsuccessful attempt to thwart the test for gunshot residue.
Dickerson has prior federal convictions for drug and counterfeiting offenses. In 1997, the defendant was convicted of Felony Conspiracy to Possess with Intent to Distribute Cocaine and Marijuana and Felony Structuring Transactions in the Eastern District of North Carolina and sentenced to 10 years imprisonment. In 2012, Dickerson pled guilty to Felony Passing, Uttering, and Publishing Counterfeit Obligations and was sentenced to 10 months imprisonment.
At sentencing, the Court heard evidence of two other uncharged incidents in December of 2016 and February of 2017 involving Dickerson. In both incidents, Dickerson brandished a handgun, made threats, and discharged a handgun. In addition to the 92 months imprisonment, Dickerson was ordered to serve three years of supervised release at the conclusion of his prison sentence.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, and the Durham County Sheriff’s Office. Special Assistant United States Attorney Kennedy Gates prosecuted the case.
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Former High Point Regional Hospital Accountant SentencedRead the Press Release
GREENSBORO, N.C. B A former High Point Regional Hospital employee who stole close to $4 million from the hospital was sentenced yesterday in federal court in Winston-Salem, announced United States Attorney Matthew G.T. Martin of the Middle District of North Carolina.
The Honorable Thomas D. Schroeder sentenced KIMBERLY RUSSELL HOBSON, 46, of Kernersville, North Carolina, to a 102 month term of imprisonment on charges of wire fraud, bank fraud, and aggravated identity theft. HOBSON pleaded guilty in February.
“Today’s stiff sentence serves notice that white collar criminals will be brought to justice. No one is above the law in the Middle District of North Carolina,” said U.S. Attorney Martin. “Thank you to the law enforcement officers with the Department of Treasury, U.S. Secret Service, Guilford County Sheriff’s Department, and High Point Police Department who have worked diligently to uncover Ms. Hobson’s fraud and seek restitution for the hospital.”
HOBSON was employed in accounting and finance at High Point Regional Hospital for more than 20 years, ending in August 2017. Over a period of approximately ten years, HOBSON wrote checks to cash, to herself, and to other family members, which were then deposited in HOBSON’s personal bank account. She also directed payments from hospital accounts to her personal loans and credit cards, and used a hospital-issued credit card for personal expenses. HOBSON also diverted direct deposits of payroll from nine other employees by intermittently substituting her bank account for the direct deposit account of the other employees.
In total, HOBSON’s schemes to steal hospital funds for her own benefit caused a total loss to the hospital of $3,880,075.53. HOBSON was ordered to pay restitution in the full amount of the loss to the hospital and to an insurance company which covered a portion of the loss.
HOBSON is also subject to a forfeiture judgment in the amount of $2,675,000, and numerous vehicles and other assets purchased by HOBSON with stolen money have been seized and forfeited. All monies recovered through forfeiture will be applied to pay restitution until the restitution is paid in full.
The case was investigated by the Department of Treasury - Office of Inspector General, United States Secret Service, Guilford County Sheriff's Department, and High Point Police Department. The case was prosecuted by Assistant United States Attorneys Robert M. Hamilton, Lynne P. Klauer, and Anand P. Ramaswamy.
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Romanian ATM Skimmer Arrested in Troy, NC, Sentenced to Four Years in PrisonRead the Press Release
GREENSBORO – A Romanian man arrested in July 2017 after using counterfeit bank cards to withdraw cash at an ATM in Troy, N.C., was sentenced to 48 months in prison for aggravated identity theft, announced U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina.
According to documents filed with the court, North Carolina State Employees Credit Union security personnel notified the U.S. Secret Service of possible ATM skimming fraud in progress on July 18, 2017, and the Troy Police Department arrested Valeri GORNET in a vehicle near the ATM. NCSECU security personnel had seen GORNET on ATM surveillance cameras engaged in similar activity thirty minutes earlier in Mount Gilead, N.C. GORNET presented police with an identification card in the name of Geani Vales of Lithuania, but fingerprint identification later showed his true identity to be Valeri GORNET, age 28, a Romanian national admitted to the U.S. on July 23, 2016, on an H1B non-immigrant visa not to exceed a stay beyond October 10, 2016. Further investigation showed that GORNET had also used cards re-encoded with the bank account information of other people to withdraw cash from ATM’s in Jamestown and Sanford, North Carolina.
United States District Judge William L. Osteen, Jr., sentenced GORNET yesterday, April 12, 2018, to two consecutive 24-month terms of imprisonment two violations of aggravated identity theft, 18 U.S.C. § 1028A. In addition to the prison term imposed, GORNET was ordered to serve one year of supervised release and to pay $5,000 in restitution to NCSECU.
This case was investigated by the United States Secret Service with assistance from the Troy Police Department, and prosecuted by Assistant U.S. Attorney Anand Ramaswamy, Cybercrime Prosecutor for the Middle District of North Carolina.
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Employees of a North Carolina Tax Return Preparation Business Plead Guilty to Preparing Fraudulent Tax ReturnRead the Press Release
WASHINGTON - Two Winston-Salem, North Carolina, tax return preparers pleaded guilty today to aiding in the preparation of a false tax return for an Internal Revenue Service (IRS) undercover agent, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Matthew G. T. Martin of the Middle District of North Carolina.
According to documents and information provided to the court, Kristyn Dion Daney and Rakeem Lenell Scales worked at a tax return preparation businesses named Fast Tax of Winston-Salem Inc. in Winston-Salem. Fast Tax was owned by Shannon DeWayne Patterson, who pleaded guilty to aiding in the preparation of a false tax return last November, and two other individuals.
As part of their pleas, Scales and Daney admitted that in March 2015 they assisted in preparing a false tax return for an IRS undercover agent. They further admitted that at the beginning of the 2014 tax filing season, they were instructed at training sessions held by one of the Fast Tax co-owners to manipulate the information on clients’ returns to maximize tax refunds.
In total, Daney admitted to aiding in the preparation of approximately 193 false tax returns, which claimed approximately $495,984.04 in fraudulent tax refunds. Scales admitted to aiding in the preparation of approximately 29 false tax returns, which claimed approximately $74,535.20 in fraudulent tax refunds.
U.S. District Judge Loretta C. Biggs scheduled sentencing for Sept. 11. Each defendant faces a statutory maximum sentence of three years in prison, as well as a period of supervised release, restitution and monetary penalties.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Martin commended special agents of IRS Criminal Investigation, who conducted the investigation, and Tax Division Trial Attorney Robert J. Boudreau and Criminal Division Chief Clifton T. Barrett of the Middle District of North Carolina, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Employees of A North Carolina Tax Return Preparation Business Plead Guilty to Preparing Fraudulent Tax ReturnRead the Press Release
WASHINGTON - Two Winston-Salem, North Carolina, tax return preparers pleaded guilty today to aiding in the preparation of a false tax return for an Internal Revenue Service (IRS) undercover agent, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Matthew G. T. Martin of the Middle District of North Carolina.
According to documents and information provided to the court, Kristyn Dion Daney and Rakeem Lenell Scales worked at a tax return preparation businesses named Fast Tax of Winston-Salem Inc. in Winston-Salem. Fast Tax was owned by Shannon DeWayne Patterson, who pleaded guilty to aiding in the preparation of a false tax return last November, and two other individuals.
As part of their pleas, Scales and Daney admitted that in March 2015 they assisted in preparing a false tax return for an IRS undercover agent. They further admitted that at the beginning of the 2014 tax filing season, they were instructed at training sessions held by one of the Fast Tax co-owners to manipulate the information on clients’ returns to maximize tax refunds.
In total, Daney admitted to aiding in the preparation of approximately 193 false tax returns, which claimed approximately $495,984.04 in fraudulent tax refunds. Scales admitted to aiding in the preparation of approximately 29 false tax returns, which claimed approximately $74,535.20 in fraudulent tax refunds.
U.S. District Judge Loretta C. Biggs scheduled sentencing for Sept. 11. Each defendant faces a statutory maximum sentence of three years in prison, as well as a period of supervised release, restitution and monetary penalties.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Martin commended special agents of IRS Criminal Investigation, who conducted the investigation, and Tax Division Trial Attorney Robert J. Boudreau and Criminal Division Chief Clifton T. Barrett of the Middle District of North Carolina, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
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North Carolina Return Preparer Sentenced to over 10 Years in Jail for Filing Fraudulent ReturnsRead the Press Release
A Durham, North Carolina, tax return preparer was sentenced today to 121 months in prison for conspiring to defraud the United States and preparing fraudulent tax returns for herself and her clients, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina.
According to documents and information presented to the court, Keesha Frye, owned and operated KEF Professional Tax Services, a Durham tax preparation business. From 2012 through 2014, Frye and other KEF employees falsified their clients’ tax returns by including fake and inflated sources of income to qualify for and maximize the earned income tax credit and increase the refunds claimed on the returns. Frye also filed false personal income tax returns that claimed bogus childcare expenses and business losses. In total, Frye’s scheme caused a tax loss of more than $1.7 million.
In addition to the prison term imposed, Frye was ordered to serve three years of supervised release and to pay $1,742,823 in restitution to the IRS.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Martin commended special agents of IRS Criminal Investigation, who investigated the case, and Tax Division Trial Attorney Nathan Brooks and Assistant U.S. Attorney Anand Ramaswamy, who prosecuted the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
North Carolina Return Preparer Sentenced to over 10 Years in Jail for Filing Fraudulent ReturnsRead the Press Release
WASHINGTON – A Durham, North Carolina, tax return preparer was sentenced today to 121 months in prison for conspiring to defraud the United States and preparing fraudulent tax returns for herself and her clients, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina.
According to documents and information presented to the court, Keesha Frye, owned and operated KEF Professional Tax Services, a Durham tax preparation business. From 2012 through 2014, Frye and other KEF employees falsified their clients’ tax returns by including fake and inflated sources of income to qualify for and maximize the earned income tax credit and increase the refunds claimed on the returns. Frye also filed false personal income tax returns that claimed bogus childcare expenses and business losses. In total, Frye’s scheme caused a tax loss of more than $1.7 million.
In addition to the prison term imposed, Frye was ordered to serve three years of supervised release and to pay $1,742,823 in restitution to the IRS.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Martin commended special agents of IRS Criminal Investigation, who investigated the case, and Tax Division Trial Attorney Nathan Brooks and Assistant U.S. Attorney Anand Ramaswamy, who prosecuted the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
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Defendant Sentenced in Card Cracking SchemeRead the Press Release
GREENSBORO, N.C. - United States Attorney Matthew G.T. Martin of the Middle District of North Carolina announced that Craig McINNIS, II, was sentenced March 13, 2018, by the Honorable Judge Thomas D. Schroeder in Federal Court in Winston-Salem, North Carolina, to 45 months confinement.
McINNIS, 28, of Durham, North Carolina, pleaded guilty on December 7, 2017, to false statements to a bank and aggravated identity theft. McINNIS was involved in a "card cracking scheme" in which he identified victims through social media sites, including dating websites such as "Plenty O' Fish" and "Tinder." He falsely represented to the women he met online that he could help them make easy money through an investment, convincing them to provide their debit cards, PINs, and other account information. McINNIS used the bank and debit card information obtained from victims to order checks from the victims' banks, which he then altered and counterfeited by replacing the victim’s name with the name of a corporation. He would then make the counterfeit checks payable to another of the victims whose information he had also obtained by false pretenses. After depositing the counterfeit checks, McINNIS would immediately withdraw the fraudulently deposited funds, often using the fraudulently obtained debit card of one of his victims.
In addition to 45 months imprisonment, McINNIS was ordered to serve five years of supervised release after completing his sentence and to pay restitution to State Employees' Credit Union and the victims of the offenses.
The United States Treasury Office of Inspector General Task Force and the City of Durham Police Department investigated this case. The case was prosecuted by Special Assistant United States Attorney Kennedy Gates and Assistant United States Attorney Frank J. Chut, Jr.
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North Carolina Tax Return Preparer Sentenced to PrisonRead the Press Release
A Durham, North Carolina, tax return preparer was sentenced to 20 months in prison today for aiding and assisting in the preparation of false tax returns, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina.
According to court documents, from 2012 through 2014, Laurean S. Robinson, 31, worked as the office manager and a return preparer at Tax Breaks, a tax preparation business in Durham. Robinson admitted that she prepared false returns for her clients that fraudulently claimed the earned income tax credit and sought inflated refunds. To qualify her clients for the earned income tax credit, Robinson falsely reported that they earned income providing household services, such as babysitting and caretaking. Robinson trained other Tax Breaks employees to prepare false returns in a similar fashion. In addition to fees charged by Tax Breaks, Robinson also often required her clients to pay her an additional fee in cash. Robinson’s conduct caused a tax loss of approximately $600,737.
In addition to the term of prison imposed, U.S. District Court Judge Thomas D. Schroeder ordered Robinson to serve one year of supervised release and pay a total of $ 120,980 in restitution to the IRS.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Martin commended special agents of IRS-Criminal Investigation, who conducted the investigation, and Tax Division Trial Attorney Daniel McGraw and Assistant U.S. Attorney JoAnna McFadden, who prosecuted the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
North Carolina Tax Return Preparer Sentenced to PrisonRead the Press Release
WASHINGTON – A Durham, North Carolina, tax return preparer was sentenced to 20 months in prison today for aiding and assisting in the preparation of false tax returns, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina.
According to court documents, from 2012 through 2014, Laurean S. Robinson, 31, worked as the office manager and a return preparer at Tax Breaks, a tax preparation business in Durham. Robinson admitted that she prepared false returns for her clients that fraudulently claimed the earned income tax credit and sought inflated refunds. To qualify her clients for the earned income tax credit, Robinson falsely reported that they earned income providing household services, such as babysitting and caretaking. Robinson trained other Tax Breaks employees to prepare false returns in a similar fashion. In addition to fees charged by Tax Breaks, Robinson also often required her clients to pay her an additional fee in cash. Robinson’s conduct caused a tax loss of approximately $600,737.
In addition to the term of prison imposed, U.S. District Court Judge Thomas D. Schroeder ordered Robinson to serve one year of supervised release and pay a total of $ 120,980 in restitution to the IRS.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Martin commended special agents of IRS-Criminal Investigation, who conducted the investigation, and Tax Division Trial Attorney Daniel McGraw and Assistant U.S. Attorney JoAnna McFadden, who prosecuted the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
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Durham Man Who Kidnapped, Robbed Families Pleads GuiltyRead the Press Release
Greensboro, N.C. – A man who kidnapped multiple people over a four-day period and forced them to withdraw money from ATMs and buy items for him pleaded guilty to federal kidnapping charges today, announced United States Attorney Matthew G.T. Martin for the Middle District of North Carolina.
Rollin Anthony Owens, Jr., 30, of Durham, North Carolina, pleaded guilty to two counts of kidnapping of a minor and one count of kidnapping, in front of the Honorable N. Carlton Tilley, Jr., United States District Judge for the Middle District of North Carolina.
According to court documents, on June 17, 2017, Owens kidnapped a father and his two small children, ages 4 and 18 months, as they were leaving Burch Avenue Park in Durham. Owens pulled out a gun and forced the father to drive to an ATM to withdraw money and to a convenience store to make purchases.
Court documents also indicate that Owens kidnapped two brothers from the parking lot of a residence in Durham on June 18, 2017. When one brother resisted, Owens pistol whipped him with a large gun and threw him in the trunk of one of the brother’s car. Owens then forced the other brother to drive the car to an ATM and withdraw money from both brothers’ accounts and to make a purchase at a convenience store.
Finally, on June 20, 2017, Owens kidnapped a man and woman and their two small children from their home in Durham. Owens knocked on the family’s door asking for money. After the father gave him money, Owens pulled out a gun, and forced the father, his wife, and two children, ages 4 and 2, into the family car. He then directed the father at gunpoint to drive to an ATM to withdraw money and to a Food Lion and convenience store to make purchases and attempt to get cash back. Owens’ crime spree finally ended when he forced the family to go to Target, where the father, while in the store purchasing items for Owens, was able to alert an employee to call the police. Durham Police Department officers apprehended Owens as he was leaving the store with more than $1,000 worth of merchandise.
The sentencing is set for June 15, 2018, at 2 p.m. in Greensboro. Each of the two counts of kidnapping of a minor carries a mandatory minimum sentence of 25 years and a maximum of life in prison. The last count of kidnapping carries a maximum sentence of life.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the United States Department of Treasury Office of Inspector General Task Force, and the Durham Police Department. Special Assistant United States Attorney Kennedy Gates and Assistant United States Attorney Frank J. Chut, Jr. prosecuted the case.
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Businessman Pleads Guilty to Misappropriating Funds from Professional AthletesRead the Press Release
GREENSBORO, N.C. B A Florida businessman who provided financial services to professional athletes pleaded guilty today to conspiracy to commit wire fraud and money laundering, announced United States Attorney Matthew G.T. Martin of the Middle District of North Carolina.
Jason Christopher JERNIGAN, age 43, a resident of Miramar, Florida, pleaded guilty to one count of conspiracy to commit wire fraud and money laundering.
According to court documents, JERNIGAN, along with his business partner Michael Rowan, operated Capital Management Wealth Advisors, Inc. (“CMG”) and APS Management, LLC (“APS”) in High Point, North Carolina. Through CMG and APS, JERNIGAN and Rowan provided financial and investment services to professional athletes, including players in the National Football League. From 2008 through 2014, JERNIGAN used his access to his clients’ bank accounts to convert and misappropriate approximately $1.48 million.
JERNIGAN’s business partner, Michael Rowan, was sentenced in April 2017 to 65 months in prison for wire fraud and filing a false 2011 tax return.
Sentencing is scheduled for June 1, 2018, at 2 p.m. in Greensboro. JERNIGAN faces a statutory maximum sentence of 5 years in prison. He also faces monetary penalties, supervised release, and restitution.
U.S. Attorney Martin commended special agents of IRS-Criminal Investigation and US Postal Inspection Service, who investigated the case, and Assistant United States Attorney Frank Chut and Trial Attorney Mara Strier of the Tax Division, who prosecuted this case.
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Denaturalization Sought Against Five Child Sexual Abusers in California, Maryland, North Carolina, and TexasRead the Press Release
WASHINGTON – The Department of Justice today filed denaturalization lawsuits against five individuals who, according to the Department’s complaints, unlawfully procured their United States citizenship by concealing their sexual abuse of minor victims during the naturalization process.
The civil complaints were filed in federal court in the Eastern District of California, the District of Maryland, the Middle District of North Carolina, and the Southern District of Texas (two cases).
“Those who wish to become American citizens ought to respect our laws and seek citizenship lawfully and honestly,” said Attorney General Jeff Sessions. “Anyone who lies, misleads, or omits critical information in an attempt to evade the requirements for naturalization undermines the credibility of our nation’s generous lawful immigration system. This Justice Department will continue to seek out fraudsters and bring them to justice by obtaining orders revoking their naturalized citizenship.”
The cases were referred to the Department of Justice by the Department of Homeland Security’s U.S. Immigration and Customs Enforcement (ICE) and U.S. Customs and Border Protection (CBP) with investigative support from U.S. Citizenship and Immigration Services.
“ICE is committed to collaborating with our sister agencies within DHS to target individuals who conceal illicit activities in order to obtain U.S. citizenship,” said ICE Deputy Director Thomas D. Homan. “When special agents identify a child predator, exploiting the most innocent among us, and other criminals who have defrauded the U.S. immigration system for naturalization benefits, then ICE will move to have their citizenship revoked.”
Under the Immigration and Nationality Act, the citizenship of a naturalized U.S. citizen may be revoked, and his or her certificate of naturalization canceled, if such naturalization was illegally procured or procured by concealment of a material fact or by willful misrepresentation.
The five defendants committed crimes of sexual abuse of minor victims prior to naturalizing. As the civil complaints allege, such crimes rendered the defendants ineligible for citizenship at the time they naturalized. By willfully concealing child sexual abuse crimes, the defendants also independently rendered themselves subject to denaturalization.
A description of each of the five cases and the allegations of the United States follows:
Ricardo De Leon
Ricardo De Leon, 32, a native of Mexico, naturalized on July 23, 2010. Before De Leon naturalized as a U.S. citizen, he sexually assaulted a child under the age of 12. In July 2015, after he had naturalized, De Leon was indicted, and in March 2017 he pleaded guilty in Texas state court to committing aggravated sexual assault of a child in 2009. He was ordered to ten years of community supervision and required to register as a sex offender. He has been residing in Edinburg, Texas. United States of America v. Ricardo De Leon (S.D. Tex.).
Christian Oribello Eguilos
Christian Oribello Eguilos, 40, a native of the Philippines, naturalized on Nov. 6, 2013. For several years before filing his naturalization application and throughout the naturalization process, Eguilos repeatedly committed forcible lewd acts upon a child under the age of 14. In September 2015, he pleaded nolo contendere in California state court to four counts of Forcible Lewd Act Upon a Child. Eguilos was sentenced to 40 years in prison and ordered to register as a sex offender. He is incarcerated in Ione, California. United States of America v. Christian Oribello Eguilos (E.D. Cal.).
Carlos Noe Gallegos
Carlos Noe Gallegos, 41, a native of Mexico, naturalized on March 10, 2010. Before Gallegos naturalized as a U.S. citizen, he sexually assaulted a seven-year-old child. In November 2016, after he had naturalized, Gallegos was indicted, and in April 2017 he pleaded guilty in Texas state court to committing aggravated sexual assault of a child in 2007. He was ordered to six years of community supervision and required to register as a sex offender. He has been residing in Alamo, Texas. United States of America v. Carlos Noe Gallegos (S.D. Tex.).
Alwin Farouk Gariba
Alwin Farouk Gariba, 51, a native of Guyana, naturalized on Feb. 29, 2000. After he applied to naturalize but while he was in the naturalization process, Gariba repeatedly sexually abused a ten-year-old child. In July 2000, only months after he had naturalized, Gariba pleaded guilty in North Carolina state court to three counts of Taking Indecent Liberties with Children. He was placed on 60 months’ probation and ordered to register as a sex offender. He has been residing in Greensboro, North Carolina. United States of America v. Alwin Farouk Gariba (M.D.N.C.).
Moises Javier Lopez
Moises Javier Lopez, 42, a native of the Republic of Colombia, naturalized on March 22, 2013. Before filing his naturalization application and throughout the naturalization process, Lopez sexually abused a minor child. In August 2013, he pleaded guilty in Maryland state court to Sexual Abuse of a Minor. He was sentenced to 25 years’ confinement, all but four suspended. He has been residing in Gaithersburg, Maryland. United States of America v. Moises Javier Lopez (D. Md.).
These cases were investigated by ICE, CBP, and the Civil Division’s Office of Immigration Litigation, District Court Section (OIL-DCS). These cases are being prosecuted by OIL-DCS and its National Security and Affirmative Litigation Unit (NS/A Unit) with support from the U.S. Attorney’s Offices for the Eastern District of California, the District of Maryland, the Middle District of North Carolina, and the Southern District of Texas.
The claims made in the complaints are allegations only, and there have been no determinations of liability.
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Former High Point Regional Hospital Employee Pleads Guilty to Stealing over $3 MillionRead the Press Release
GREENSBORO, N.C. - United States Attorney Matthew G.T. Martin of the Middle District of North Carolina announced that KIMBERLY RUSSELL HOBSON, 46, of Kernersville, North Carolina, pleaded guilty today in federal court in Winston-Salem before the Honorable Thomas D. Schroeder to felony charges of wire fraud, bank fraud, and aggravated identity theft.
HOBSON was employed in accounting and finance at High Point Regional Hospital for more than 20 years, ending in August 2017. HOBSON pleaded guilty to the above charges in connection with embezzling funds from the hospital. The indictment alleges that HOBSON stole in excess of $3,000,000.00 from the hospital. The exact amount of the loss will be determined by the Court at sentencing.
HOBSON faces a maximum penalty of thirty-two years confinement. The plea agreement requires HOBSON to make restitution to the hospital. Sentencing will occur in Winston-Salem on May 2, 2018.
The case was investigated by the Department of Treasury - Office of Inspector General, United States Secret Service, Guilford County Sheriff's Department, and High Point Police Department. The case was prosecuted by Assistant United States Attorneys Robert M. Hamilton, Lynne P. Klauer, and Anand P. Ramaswamy.
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Former Paralegal Sentenced to Federal Prison for Embezzlement from Two Law FirmsRead the Press Release
Greensboro, N.C. – A North Carolina resident was sentenced Friday to 65 months in federal prison on charges of wire fraud and aggravated identity theft, announced United States Attorney Matthew G.T. Martin for the Middle District of North Carolina.
Penny S. DAVIS, 57, of Cary, North Carolina, was sentenced on January 12, 2018, by the Honorable Catherine C. Eagles, United States District Judge for the Middle District of North Carolina. DAVIS pled guilty to one count of mail fraud and one count of aggravated identity theft on May 17, 2017.
Court documents and the testimony of witnesses at the sentencing hearing reveal that DAVIS worked as a paralegal with an expertise in estate work. In this capacity, she worked at a Chapel Hill law firm on estate and guardianship cases. After resigning her position, a Durham law firm hired her to do similar work. DAVIS used her position at both firms to embezzle money from estates in probate in which the firms represented the executor of the estate. The court determined that DAVIS stole over $250,000 from multiple estates. This money was used by DAVIS in part to pay off bills she ran-up using credit cards belonging to the deceased whose estates were in probate or to disabled persons in guardianship. DAVIS used the funds to pay for trips to see Broadway shows and to keep horses among other things. In so doing, DAVIS illegally used the identifying information of the executor of one of the estates to carry out her scheme.
At the sentencing hearing, the District Court found that DAVIS targeted certain estates as being particularly vulnerable due to the absence of family members to oversee local probate proceedings. DAVIS also specifically targeted a retired North Carolina judge who had been rendered incompetent by dementia and age. DAVIS exploited the fact that her firm served as legal guardian for the retired judge to use a credit card in the judge’s name for her own benefit.
DAVIS also used sophisticated means to carry out and conceal her theft. Evidence at the sentencing hearing established that DAVIS used her extensive knowledge of the North Carolina probate system to falsify court documents to conceal her theft. DAVIS transferred money from estate to estate to cover her misappropriation of estate funds.
DAVIS successfully concealed her theft from both law firms despite the fact she worked for experienced trust and estate lawyers. In fact, the law firms did not discover her actions until after she had left the employ of the Durham law firm.
In addition to a 65-month term of imprisonment, Judge Eagles sentenced DAVIS to three years of supervised release and ordered her to pay $180,827.55 in restitution.
This case was investigated by the United States Department of Treasury Office of Inspector General Task Force and the Durham Police Department. Special Assistant United States Attorney Kennedy Gates and Assistant United States Attorney Frank Joseph Chut, Jr. prosecuted the case.
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