Western District of North Carolina
Press releases recorded for this federal judicial district.
U.S. Attorney Issues Scam Alert: Beware of Imposters Claiming to Be with the Justice Department, Preying on the ElderlyRead the Press Release
CHARLOTTE, N.C. – U.S. Attorney Andrew Murray issued an alert today, warning the public of potential scammers seeking to obtain personal information by claiming to be with the Justice Department.
In making today’s announcement, U.S. Attorney Murray warned, “Watch out for imposters claiming to be Justice Department representatives, attempting to obtain personal information that can be used to perpetrate fraud. It is particularly disturbing that scammers appear to be targeting older adults, though everyone can be potentially victimized. I caution the public to remain extra vigilant against these imposter schemes. If you are contacted, do not disclose any personal information and report the scam by calling the Department of Justice’s Elder Fraud Hotline at 1-833-Fraud-11, or 1-833-372-8311.”
Reports to the National Elder Fraud Hotline indicate these scammers falsely represent themselves as Department of Justice investigators or employees, and attempt to obtain personal information from the call recipient, or they leave a voicemail with a return phone number. The return phone number directs callers to a recorded menu that matches the recorded menu for the Justice Department’s main phone number. Eventually, the caller reaches an “operator” who steers the caller to someone claiming to be an investigator. That “investigator” then attempts to gain the caller’s personal information.
Those who receive imposter calls are cautioned against providing any personal information. If contacted, please file a report with:
- The Justice Department’s Elder Fraud Hotline at 1-833-Fraud-11 (1-833-372-8311).
- The Federal Trade Commission (FTC) via their website or by calling 877–FTC–HELP (877-382-4357).
- The FBI, for law enforcement action at https://www.justice.gov/criminal-fraud/report-fraud.
The National Elder Fraud hotline was created for the public to report fraud against individuals who are age 60 or older. The hotline is open seven days a week. For more information about the hotline, please visit https://stopelderfraud.ovc.ojp.gov/.
Owner and Two Managers of Health Care Practice Agree to Pay $900,000 to Resolve Allegations of Medically Unnecessary TestingRead the Press Release
CHARLOTTE, N.C. - U.S. Attorney Andrew Murray announced today that two former managers and the owner of the now defunct North-Carolina based Carolina Comprehensive Health Network, PA (CCHN) have agreed to resolve allegations that they violated the False Claims Act by causing CCHN to bill claims for medically unnecessary diagnostic tests and procedures to the Medicare and Medicaid programs.
Michael Smith, Codey Brown, and CCHN’s former owner, Dr. Harrison Frank, have collectively agreed to pay $900,000.00 to resolve the allegations.
“When health care professionals engage in deceptive schemes for the sake of their bottom line, their patients’ health is no longer their first priority,” said U.S. Attorney Murray. “Billing Medicare and Medicaid for unnecessary testing wastes taxpayer dollars and diverts funds intended for needed medical care. Working with our state partners, we will use all resources and tools at our disposal to pursue and hold accountable individuals who perpetrate fraud on federal health care programs.”
“When health care programs and providers cheat the Medicaid program, they’re cheating taxpayers,” said Attorney General Josh Stein. “My office will hold accountable any business and individual that commits fraud and wastes health care resources.”
Before it ceased operations, CCHN consisted of a group of healthcare practices, including multiple locations in the Western District of North Carolina, that provided family medicine, immediate care, and pain management services. The settlement resolves allegations that from May 1, 2015 through November 30, 2015, CCHN billed the Medicare and Medicaid programs for unnecessary diagnostic procedures including positional nystagmus testing, rotational axis testing, nerve conduction testing, and autonomous nervous system testing.
The allegations arose from a lawsuit filed by a whistleblower under the qui tam provisions of the federal False Claims Act, and the North Carolina False Claims Act. Under the False Claims Acts, private citizens can bring suit on behalf of the government for false claims and share in any recovery. The act also allows the government to intervene and take over the action. The government conducted the investigation and intervened in this action to effectuate the settlement.
The settlement is a result of the coordinated effort between the Department of Health and Human Services Office of the Inspector General, the North Carolina Attorney General’s Medicaid Investigations Division, and the United States Attorney’s Office for the Western District of North Carolina.
The lawsuit resolved by this settlement is United States and the State of North Carolina ex rel. David A. Majure, M.D., Carla C. Majure v. Carolina Comprehensive Health Network, PA, et al. (5:15-CV-134). The claims resolved in this settlement are allegations only and there has been no determination of liability.
Leader and Members of Methamphetamine Trafficking Ring Are Sentenced to PrisonRead the Press Release
CHARLOTTE, N.C. – Senior U.S. District Judge Graham C. Mullen sentenced to prison the leader and members of a methamphetamine trafficking ring on drug conspiracy charges, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.
Judge Mullen sentenced the defendants as follows:
- The leader, Cheng “Cam” Yang, 34, of Claremont, N.C., was sentenced to 15 years in prison and five years of supervised release.
- Cheng “Cam” Young’s brother, Peng Yang, 35, of Claremont, N.C, was sentenced to 156 months in prison and five years of supervised release.
- Cheng “Cam” Yang’s younger brother, Nicholas Yang, 21, of Claremont, N.C., was sentenced to three years in prison followed by five years of supervised release.
- Cheng “Cam” Yang’s aunt, Susan Yang, 37, of Claremont, N.C., was ordered to serve 42 months in prison and five years of supervised release.
- Cheng “Dawb” Yang, 38, of Morganton, N.C., who bears no familial relationship to Cheng “Cam” Yang, was sentenced to 60 months in prison and five years of supervised release.
- Austin Litchfield, 31, of Los Angeles, was ordered to serve 12 years in prison and five years of supervised release.
- Randy Martinez, 27, also of Los Angeles, was sentenced to 48 months in prison and three years of supervised release.
In related cases, Cheng “Cam” Yang’s distributors were sentenced as follows:
- Belden Watson, 59, of Rutherford College, N.C., was sentenced to 97 months in prison and five years of supervised release.
- Rex Eversole, 30, of Morganton, was sentenced to 110 months in prison and five years of supervised release; and
- Ashley Vaught, 30, of Lenoir, N.C., was sentenced to 30 months in prison and two years of supervised release.
According to filed court documents and statements made in court, from March 2019 to September 2019, Cheng “Cam” Yang led a methamphetamine trafficking conspiracy operating in Caldwell County and elsewhere. Litchfield, assisted by Martinez, was Cheng “Cam” Yang’s California-based source of supply of methamphetamine. Yang distributed the methamphetamine in Caldwell County assisted by his local drug network of distributors. According to court records, over the course of the conspiracy, Cheng “Cam” Yang and his co-defendants distributed more than 45 kilograms of high-purity methamphetamine, with a street value of over $4 million.
During the arrests of the defendants on September 10, 2019, law enforcement seized three and a half kilograms of crystal methamphetamine and seven firearms from the defendants’ homes.
The defendants were prosecuted as part of an ongoing Organized Crime Drug Enforcement Task Force (OCDETF) investigation dubbed “Dixie Crystal.” Since 2015, the investigation has led to the prosecution of more than 200 individuals, and the seizure of more than 100 kilograms of crystal methamphetamine, $1,000,000 in U.S. currency and other assets, and dozens of firearms.
OCDETF is a joint federal, state and local cooperative approach to combat drug trafficking and is the nation’s primary tool for disrupting and dismantling major drug trafficking organizations, targeting national and regional drug trafficking organizations, and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets.
In making today’s announcement U.S. Attorney Murray thanked the following agencies for their investigative efforts which led to the prosecution of this case: ICE’s Homeland Security Investigations (HSI) in Charlotte; the Drug Enforcement Administration’s Charlotte Field Office; the U.S. Postal Inspection Service in Charlotte; the Bureau of Alcohol, Tobacco, Firearms & Explosives in Charlotte; the North Carolina State Bureau of Investigation; the Alexander County Sheriff’s Office; the Burke County Sheriff’s Office; the Caldwell County Sheriff’s Office; the Catawba County Sheriff’s Office; the Lincoln County Sheriff’s Office; the Hickory Police Department; the Mooresville Police Department; the Newton Police Department; the Longview Police Department; the Huntersville Police Department; the Charlotte Mecklenburg Police Department; and the Morganton Department of Public Safety.
Assistant U.S. Attorney Steven R. Kaufman, of the U.S. Attorney’s Office in Charlotte, is prosecuting the case.
Illegal Alien Caught Trafficking Eight Kilograms of Mexican Heroin Is Sentenced to 10 Years in PrisonRead the Press Release
CHARLOTTE, N.C. – Today, U.S. District Judge Max O. Cogburn Jr. ordered Ramiro Garcia-Valdivia, 33, of Mexico, to serve 10 years in prison and five years of supervised release for drug trafficking and immigration violations, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.
According to court documents and court proceedings, in 2019, Garcia-Valdivia was working for the CJNG Mexican Cartel, and was responsible for trafficking multiple kilograms of heroin into Western North Carolina. On October 1, 2019, law enforcement arrested Garcia-Valdivia in Gastonia, North Carolina. Over the course of the arrest, law enforcement recovered more than eight kilograms of heroin wrapped in bundles, hidden in Garcia-Valdivia’s Ford Explorer vehicle. Court records show that Garcia-Valdivia intended to deliver these narcotics to other co-conspirators. According to court records, Garcia-Valdivia, who was in the country illegally after being previously deported, engaged in drug trafficking activities while there was an outstanding immigration order for his deportation from the United States.
“Garcia-Valdivia violated our nation’s drug and immigration laws, and trafficked large quantities of heroin, a poisonous substance that shatters our communities and causes thousands of overdose deaths in our country. The lengthy sentence imposed by the Court is appropriate for Garcia-Valdivia’s harmful criminal conduct,” said U.S. Attorney Murray.
On March 10, 2020, Garcia-Valdivia pleaded guilty to drug trafficking conspiracy, possession with intent to distribute heroin, and illegal reentry by an aggravated felon. Garcia-Valdivia is in federal custody, and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.
The investigation was led by ICE’s Homeland Security Investigations, the North Carolina Highway Patrol, and the Gaston County Police Department.
Assistant U.S. Attorneys Sanjeev Bhasker and Kenneth Smith, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.
Ghanaian National Is Sentenced to Prison for His Role in Financial Scams Targeting Older VictimsRead the Press Release
CHARLOTTE, N.C. – Suleman Alhassan, 38, a Ghanaian national residing in Charlotte, was sentenced today by U.S. District Judge Max O. Cogburn Jr. to 51 months in prison and one year of supervised release for his involvement in financial scams targeting older adults, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. In addition to the prison term imposed, Judge Cogburn ordered Alhassan to pay $1,127,989 as restitution, and to be deported upon completion of his prison term.
Tommy D. Coke, Inspector in Charge of the Atlanta Division of the U.S. Postal Inspection Service (USPIS), which oversees Charlotte, and Ronnie Martinez, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) in Charlotte, join U.S. Attorney Murray in making today’s announcement.
“Alhassan preyed upon older victims by exploiting their vulnerabilities, including their human need for a personal connection and a loving relationship. Some of the victims were exploited repeatedly, until their well ran dry and they had no more money to give,” said U.S. Attorney Murray. “Investigating and prosecuting the full range of criminal activities that exploit America’s seniors is a priority for my office. It’s equally important that all of us look out for our elderly family and friends who may be targeted by scammers, as a watchful eye can make all the difference in keeping our loved ones safe, and preventing their financial and emotional devastation.”
“The U.S. Postal Inspection Service takes great pride in protecting the American public, especially our vulnerable older Americans. Those seeking to defraud and take advantage of our postal customers should know they will not go undetected and will be held accountable,” said Inspector-in-Charge Coke.
“This case makes clear that transnational scammers who believe they can avoid accountability for their crimes are mistaken,” said Special Agent in Charge Martinez. “HSI is committed to using its unique, cross-border investigative authorities to hold persons accountable who defraud senior citizens and other vulnerable persons. We’re appreciative of our partnership with the U.S. Attorney’s Office to successfully prosecute this case, and will continue to work with our federal, state and local partners to identify and stop financial crimes targeting vulnerable populations.”
According to filed documents and today’s sentencing hearing, beginning in or about March 2016, Alhassan conspired with other individuals in the United States and in Ghana to execute romance and precious metals scams that defrauded more than 20 older victims of over $1 million. According to court records, Alhassan and his co-conspirators operated the romance scheme by creating fake profiles and using fake identities on internet dating websites and other methods to target potential fraud victims, who were frequently elderly, with false promises of a romantic relationship.
According to court records, as part of the scheme, and in addition to developing fake romantic relationships with the victims, Alhassan and others falsely claimed to own large quantities of gold located in Ghana. The victims were induced to send money to Alhassan and others, purportedly to pay for expenses to ship the gold from Ghana to the United States and other countries, where it could be sold. As Alhassan previously admitted in court documents, he and his co-conspirators falsely told the victims that they would receive a share of the profits when the gold was brought and sold in the United States.
According to court records, Alhassan and his co-conspirators further induced victims to send funds under the guise of securing travel documents for the person with whom the victims believed to be in a romantic relationship. To convince victims to continue to send money, Alhassan and his co-conspirators invented fictitious obstacles, including problems with travel visas and customs related issues. The co-conspirators continued to call, text, and e-mail the victims and insist that more money was needed. Alhassan and his co-conspirators employed these tactics until the victims either ran out of money or discovered the fraudulent nature of the scheme.
Court records show that, in August 2017, Alhassan was stopped at the Charlotte airport with more than $130,000 in proceeds derived from the fraud. Alhassan continued to be involved in the scams even after law enforcement seized the funds, until he was arrested and charged federally for his role in the fraudulent scheme.
Alhassan is currently detained and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.
In making today’s announcement, U.S. Attorney Murray commended the USPIS and HSI for their investigation of this case.
Assistant United States Attorney Jenny G. Sugar, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.
In March 2019, Andrew Murray, U.S. Attorney for the Western District of North Carolina, announced the Office’s Elder Justice Initiative, which aims to combat elder financial exploitation by expanding efforts to investigate and prosecute financial scams that target seniors; educate older adults on how to identify scams and avoid becoming victims of financial fraud; and promote greater coordination with law enforcement partners. For more information please visit: /usao-wdnc/elder-justice-initiative
Convicted Felon Is Sentenced to Seven Years for Illegally Possessing A FirearmRead the Press Release
CHARLOTTE, N.C. – U.S. Attorney Andrew Murray announced that Jamien Markee Marshall, 31, of Charlotte, was ordered to serve seven years in prison and three years of supervised release for illegally possessing a firearm. U.S. District Judge Max O. Cogburn Jr. handed down the sentence today, which included sentencing guideline enhancements for Marshall’s two prior armed robbery convictions and the obliterated serial number on the firearm.
According to filed court documents and the sentencing hearing, on March 26, 2019, Charlotte-Mecklenburg Police Department (CMPD) officers patrolling L.C. Coleman Park in Charlotte observed Marshall’s parked vehicle. When officers approached Marshall, who was sitting in the driver’s seat, Marshall informed the officers that there was a firearm in the vehicle. The officers observed the firearm in between the driver’s seat and the center console. Over the course of the investigation, officers determined that the firearm was loaded and the serial number had been rubbed off the gun. On March 2, 2020, Marshall pleaded guilty to possession of a firearm by a felon. Marshall has two prior Robbery with a Dangerous Weapon convictions in Mecklenburg County, and he is prohibited from possessing a firearm or ammunition.
Marshall is in federal custody. He will be transferred to the custody of the Federal Bureau of Prisons upon the designation of a federal facility.
The investigation was handled by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and CMPD. Assistant United States Attorney William Bozin, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.
Pineville Man Is Sentenced to Prison for Credit Card FraudRead the Press Release
CHARLOTTE, N.C. – U.S. District Judge Max O. Cogburn Jr. sentenced Charles Vincent Brown, 36, of Pineville, N.C., today to 51 months in prison for credit card fraud, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. Judge Cogburn also ordered Brown to serve two years under court supervision, and to pay $237,141.41 as restitution.
Reginald A. DeMatteis, Special Agent in Charge of the United States Secret Service, Charlotte Field Office, joins U.S. Attorney Murray in making today’s announcement.
On November 4, 2019, Brown pleaded guilty to conspiracy to commit access device fraud. A federal jury convicted Brown’s co-defendant, Robert Nathaniel Johnson III, on July 28, 2020, of conspiracy to commit access device fraud and access device fraud for his role in the fraudulent scheme.
According to filed court documents and today’s sentencing hearing, from September 29, 2018, to October 20, 2018, Brown, Johnson and others used a stolen credit card number to create counterfeit credit cards, which they then used to purchase more than $250,000 of merchandise. According to court records, Brown and Johnson stole the credit card number of an individual identified as Victim #1, whose credit card had a credit limit of $300,000. The co-conspirators created counterfeit credit cards bearing the defendants’ names and the names of other co-conspirators, and used them at multiple retail stores, including at Best Buy, Foot Action, Foot Locker, and Neiman Marcus.
According to court records, Secret Service agents executed a search warrant at Brown’s apartment, and seized more than 560 pairs of high-end sneakers and other footwear, electronics, clothing, gaming equipment, and other items Brown had purchased using the counterfeit credit cards. Agents also seized computers, an embosser, a laminator, and other items used to manufacture counterfeit credit cards and fake identity documents. Court records show that a forensic examination of Brown’s seized cell phones revealed text messages from Brown advising other individuals on how to purchase stolen credit card information, screenshots of dark web searches for stolen credit card information, and receipts for the purchase of dozens of stolen credit card numbers.
Brown is currently in federal custody. A sentencing date for Johnson has not been set.
In making today’s announcement, U.S. Attorney Murray thanked the U.S. Secret Service for their investigation of this case.
Assistant U.S. Attorney Caryn Finley, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.
North Carolina State Legislator Pleads Guilty to Making a False Statement to a BankRead the Press Release
A member of the North Carolina House of Representatives pleaded guilty today to making a false statement to a bank and failing to file an income tax return.
David R. Lewis, 49, of Dunn, North Carolina, pleaded guilty to one count of making a false statement to a bank and one count of failing to file a tax return before U.S. Magistrate Judge David S. Cayer of the Western District of North Carolina. A sentencing hearing will be set at a later date.
According to documents filed with the court, Lewis has served as a Representative in the North Carolina House of Representatives since 2002, representing District 53. Lewis also owned and operated Lewis Farms, a farming corporation in North Carolina.
On or about Aug. 1, 2018, Lewis opened a bank account in the name of “NC GOP, Inc.” In completing the application to open the account, Lewis falsely certified to the bank that NC GOP Inc. was a corporation formed in North Carolina, of which Lewis was president. In fact, NC GOP Inc. was not a legal entity registered in North Carolina or in any other state. Lewis then used the NC GOP Inc. bank account to misappropriate campaign funds by disguising transfers from his campaign account to the NC GOP Inc. account as lawful contributions to the North Carolina Republican Party (commonly called the NCGOP). NC GOP Inc. had no actual association to the North Carolina Republican Party.
To that end, on or about July 31, 2018, Lewis caused a check to be written in the amount of $50,000 from his campaign account, made payable to NCGOP. Lewis caused this $50,000 expenditure to be reported to the North Carolina Board of Elections as a lawful contribution to the North Carolina Republican Party. Rather than sending the check to the North Carolina Republican Party, however, Lewis deposited the check into the NC GOP Inc. bank account immediately after opening the account on Aug. 1, 2018. The same day, Lewis transferred the majority of the funds in the NC GOP, Inc. account to his bank account for Lewis Farms, and used the remainder to pay rent on his residence.
Additionally, on or about Aug. 15, 2018, Lewis purchased a cashier’s check in the amount of $15,000 from his campaign account, made payable to NC GOP Inc. Lewis caused this $15,000 expenditure to be reported as a lawful contribution to the North Carolina Republican Party. That same day, however, rather than sending the check to the North Carolina Republican Party, Lewis deposited the check into the NC GOP Inc. account and subsequently transferred the funds to his bank account for Lewis Farms.
At a later date, Lewis made two contributions in the amount of $50,000 and $15,000 to the North Carolina Republican Party from one of his personal bank accounts. After using the NC GOP Inc. account to conduct the transactions described above, Lewis closed the account.
Lewis also admitted to willfully failing to file a tax return for calendar year 2018.
This case was investigated by the FBI and IRS-Criminal Investigation. Trial Attorneys Erica O’Brien Waymack and James C. Mann of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorneys William T. Stetzer and Dana O. Washington of the U.S. Attorney’s Office for the Western District of North Carolina are prosecuting the case.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
North Carolina State Legislator Pleads Guilty to Making A False Statement to A BankRead the Press Release
CHARLOTTE, N.C. – A member of the North Carolina House of Representatives pleaded guilty today to making a false statement to a bank and failing to file an income tax return, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.
David R. Lewis, 49, of Dunn, North Carolina, pleaded guilty to one count of making a false statement to a bank and one count of failing to file a tax return before U.S. Magistrate Judge David S. Cayer of the Western District of North Carolina. A sentencing hearing will be set at a later date.
According to documents filed with the court, Lewis has served as a Representative in the North Carolina House of Representatives since 2002, representing District 53. Lewis also owned and operated Lewis Farms, a farming corporation in North Carolina.
On or about Aug. 1, 2018, Lewis opened a bank account in the name of “NC GOP, Inc.” In completing the application to open the account, Lewis falsely certified to the bank that NC GOP Inc. was a corporation formed in North Carolina, of which Lewis was president. In fact, NC GOP Inc. was not a legal entity registered in North Carolina or in any other state. Lewis then used the NC GOP Inc. bank account to misappropriate campaign funds by disguising transfers from his campaign account to the NC GOP Inc. account as lawful contributions to the North Carolina Republican Party (commonly called the NCGOP). NC GOP Inc. had no actual association to the North Carolina Republican Party.
To that end, on or about July 31, 2018, Lewis caused a check to be written in the amount of $50,000 from his campaign account, made payable to NCGOP. Lewis caused this $50,000 expenditure to be reported to the North Carolina Board of Elections as a lawful contribution to the North Carolina Republican Party. Rather than sending the check to the North Carolina Republican Party, however, Lewis deposited the check into the NC GOP Inc. bank account immediately after opening the account on Aug. 1, 2018. The same day, Lewis transferred the majority of the funds in the NC GOP, Inc. account to his bank account for Lewis Farms, and used the remainder to pay rent on his residence.
Additionally, on or about Aug. 15, 2018, Lewis purchased a cashier’s check in the amount of $15,000 from his campaign account, made payable to NC GOP Inc. Lewis caused this $15,000 expenditure to be reported as a lawful contribution to the North Carolina Republican Party. That same day, however, rather than sending the check to the North Carolina Republican Party, Lewis deposited the check into the NC GOP Inc. account and subsequently transferred the funds to his bank account for Lewis Farms.
At a later date, Lewis made two contributions in the amount of $50,000 and $15,000 to the North Carolina Republican Party from one of his personal bank accounts. After using the NC GOP Inc. account to conduct the transactions described above, Lewis closed the account.
Lewis also admitted to willfully failing to file a tax return for calendar year 2018.
This case was investigated by the FBI in Charlotte and IRS-Criminal Investigation. Trial Attorneys Erica O’Brien Waymack and James C. Mann of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorneys William T. Stetzer and Dana O. Washington of the U.S. Attorney’s Office for the Western District of North Carolina are prosecuting the case.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Georgia Man Pleads Guilty to Conspiracy Charges for Defrauding the North and South Carolina Medicaid ProgramsRead the Press Release
CHARLOTTE, N.C. – Markuetric Stringfellow, 37, of Powder Springs, Georgia, appeared in court today and pleaded guilty to federal conspiracy charges filed in the U.S. District Courts in North and South Carolina, for defrauding the states’ Medicaid programs, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina, and U.S. Attorney Peter M. McCoy, of the U.S. Attorney’s Office for the District of South Carolina. U.S. Magistrate Judge David S. Cayer presided over today’s plea hearing.
The North Carolina Scheme
According to filed plea documents and today’s plea hearing, Stringfellow was a resident of Charlotte and Greensboro, North Carolina, and a partner in Everlasting Vitality, LLC (EV) and Do-It-4-The Hood Corporation (D4H). D4H operated after-school programs in Charlotte, Greensboro, Winston-Salem, and Rocky-Mount, North Carolina, among others. Beginning in or about January 7, 2016, and continuing through November 12, 2018, Stringfellow and his co-conspirators executed a conspiracy to defraud the North Carolina Medicaid program by soliciting illegal kickbacks from various drug testing laboratories, in exchange for referrals of North Carolina Medicaid beneficiaries obtained through the after-school programs operated by EV and D4H.
According to court documents, Stringfellow and his co-conspirators paid individuals to recruit at-risk youths, in particular children who were Medicaid eligible, for EV’s or D4H’s after-school and youth mentoring programs. Once enrolled, children were required to submit urine specimens for drug testing. Stringfellow and his co-conspirators conspired with certain laboratories to perform the drug testing of the urine specimens submitted in the names of children enrolled at EV and D4H, and received kickbacks after the laboratories were reimbursed by the North Carolina Medicaid.
In addition to the kickback scheme, Stringfellow and his conspirators devised a scheme to defraud North Carolina Medicaid by referring clients to laboratories which they knew would file fraudulent claims and receive reimbursement based on drug testing services that did not meet the drug testing policy requirements. For example, on some occasions, Stringfellow and his co-conspirators obtained personal identifying information (PII) of D4H clients, such as names, addresses, dates of birth, and Medicaid beneficiary numbers, which they provided to drug testing laboratories. In turn, the laboratories used D4H clients’ PII to submit drug testing claims to the North Carolina Medicaid that were fraudulent because, among other reasons, the drug tests were not medically necessary, or the urine specimens were not of the Medicaid beneficiaries under whose names they were submitted. Once North Carolina Medicaid paid the fraudulent claims submitted by the testing laboratories for these unauthorized and medically unnecessary drug tests, the labs then paid companies under the control of Stringfellow and others, at an agreed percentage of their Medicaid reimbursement.
The South Carolina Scheme
In addition to executing a fraudulent scheme in North Carolina, Stringfellow has admitted to defrauding the South Carolina Medicaid program. According to the bill of information and documents filed with the U.S. District Court in South Carolina, Stringfellow was a franchise owner of Wrights Care Services LLC (Wrights Care), a qualified provider of Medicaid rehabilitative behavioral health services in South Carolina. Wrights Care was located at 1320 Main Street, in Columbia, South Carolina, and maintained separate franchise locations throughout South Carolina, including in Spartanburg, Pickens, Cheraw, Society Hill, Bennettsville, Hartsville, and Conway. In April 2014, Wrights Care became a participating provider in the South Carolina Medicaid program, which allowed Wrights Care to submit claims for behavioral mentoring services reimbursable under Medicaid.
Starting in or around 2014, Stringfellow and his co-conspirators defrauded the South Carolina Medicaid program by filing fraudulent claims for services that were either not provided, partially provided, or did not qualify for reimbursement. According to court records, to support the fraudulent reimbursement claims filed with the South Carolina Medicaid, Stringfellow and his co-conspirators submitted falsified patient billing records and fake medical notes. Furthermore, court records show that after learning there was a Medicaid audit for Wrights Care, Stringfellow and his co-conspirators attempted to deceive South Carolina Medicaid auditors. In or about March 2015, Stringfellow met other associates of Wrights Care in Columbia for a “note party,” during which the co-conspirators created false and fraudulent billing records to substantiate previously-submitted fraudulent Medicaid claims, forged signatures, and falsified records subject to the audit, which they then submitted to South Carolina Medicaid auditors in response to the audit.
Stringfellow pleaded guilty today to two counts of conspiracy to commit Medicaid fraud. The South Carolina case will be transferred to the U.S. District Court for the Western District of North Carolina. Each conspiracy charge carries a maximum sentence of five years in prison and a $250,000 fine. A sentencing date for Stringfellow has not been set.
In making today’s announcement U.S. Attorney Murray and U.S. Attorney McCoy commended the investigative work of the FBI field offices in Charlotte, Columbia and Atlanta, and the Medicaid Investigation Divisions in Raleigh, Columbia and Atlanta, and thanked the U.S. Attorney’s Office for the Northern District of Georgia for their assistance and coordination.
Assistant U.S. Attorneys Michael Savage in Charlotte and Brook Andrews in Columbia are prosecuting the case.
Charlotte Man Appears in Federal Court for Orchestrating Multiple Fraud SchemesRead the Press Release
CHARLOTTE, N.C. – Dino Crnalic, 33, of Charlotte, appeared in federal court today following his arrest on Friday, August 21, 2020, for various fraud schemes that defrauded the U.S. Small Business Administration (SBA) and others of more than $800,000, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. U.S. Magistrate Judge David S. Cayer presided over the hearing. The alleged fraud schemes involved Crnalic’s efforts to open a sushi restaurant and fitness center near Uptown Charlotte.
According to allegations contained in the indictment, from July 2017 through at least November 2019, Crnalic executed multiple fraudulent schemes and obtained more than $800,000 in SBA-backed loans from various federally insured financial institutions and from other entities. As alleged in the indictment, Crnalic secured the SBA-backed loans by submitting fraudulent documents, including fraudulent applications and fake supporting documentation, and by making various false statements. As part of his fraudulent schemes, the indictment alleges that Crnalic also stole the identity of at least one individual identified in court documents as C.P., and used various falsified documents in C.P.’s name, including a falsified United States Passport. According to the indictment, Crnalic fraudulently obtained more than $800,000 through his schemes, which he used for, among other things, personal expenses, including trips to various casinos, and attempted to obtain hundreds of thousands of dollars.
The indictment alleges that, during the relevant time period, Crnalic formed various business entities doing business in the Charlotte area that he controlled, including Suki Sushi LLC (Suki), Suki Akor LLC (Akor) and Surge Fitness Centers, LLC (Surge). As alleged in the indictment, by no later than the summer of 2016, Crnalic began the process of opening a new sushi restaurant in uptown Charlotte named Suki Akor. As part of that process, Crnalic applied for a loan with a financial institution in the name of Suki, through the SBA 7(a) Loan Guaranty Program. Under this program, the SBA does not loan money directly to small businesses, but provides guaranty to the lending financial institutions that the SBA will repay a percentage of a qualified loan in the event that a borrower defaults.
In applying for the loan with the financial institution for an SBA-backed loan, and obtaining the loan disbursements, the indictment alleges that Crnalic submitted numerous fraudulent documents and made various false statements, including that C.P. was a partner in Suki, when in fact C.P. had nothing to do with Suki or the Suki Akor restaurant. Crnalic also submitted fake invoices for construction costs at the restaurant, fraudulent operating agreements bearing C.P.’s forged signature, falsified bank statements, and fraudulent loan applications. Furthermore, as alleged in the indictment, Crnalic sent and received emails using an email address purportedly belonging to C.P., when in fact Crnalic controlled the email address.
The indictment alleges that, contrary to promises Crnalic made to the financial institution that provided the loan, Crnalic spent a portion of the loan proceeds to cover personal expenses, including to gamble, pay rent on an apartment in Uptown Charlotte, make a car payment on a luxury vehicle, and make purchases at restaurants and bars throughout North Carolina, Florida and in Las Vegas.
According to allegations in the indictment, on or around January 2018, Crnalic applied for an SBA line of credit in the name of Suki through the same financial institution. As with a previous loan application, Crnalic submitted fraudulent loan documents that contained, among other things, forged signatures for C.P., some of which had been notarized through the use of a falsified United States Passport in C.P’s name. Based on the fraudulent documentation, Crnalic was able to obtain an SBA-guaranteed line of credit loan through the financial institution. Contrary to his representations about how the proceeds would be used, Crnalic used a portion of the proceeds for personal use, including to fund a trip to Harrah’s casino in New Orleans.
As alleged in the indictment, in or around March 2018, Crnalic opened up a restaurant in uptown Charlotte named Suki Akor. By no later than May 2018, the restaurant closed, and it ceased operations permanently. At the time of its closing, the indictment alleges that Suki and Akor had hundreds of thousands of dollars in unpaid obligations in addition to the SBA-backed loans from the financial institution, most of which were never paid.
According to allegations in the indictment, by no later than the fall of 2018, Crnalic began the process of opening Surge, a new fitness center located near Uptown Charlotte, and applied for a $250,000 business loan with another financial institution. As with the previous restaurant scheme, Crnalic submitted numerous fraudulent documents and made various false statements while attempting to obtain the loan, including making false statements about the business and C.P.’s involvement. When the financial institution requested to meet with Crnalic and C.P. to discuss the loan further, the indictment alleges that Crnalic stopped pursuing the loan. Also in connection with his efforts to open Surge, Crnalic used C.P.’s identity and other falsified documents to finance $47,473 in fitness equipment through an equipment financing company headquartered in Alexandria, Minnesota. As alleged in the indictment, Surge ultimately defaulted on the lease agreement with the company.
Crnalic is charged with two counts of financial institution fraud, which carry a maximum sentence of 30 years in prison and a $1,000,000 fine per count; three counts of aggravated identity theft, which carry a mandatory sentence of two years in prison per count, consecutive to any other sentence imposed; concealment money laundering, which carries a maximum prison term of 20 years and a $500,000 fine; making a false statements to a bank in connection with a loan, which carries a maximum prison sentence of 30 years and a $1,000,000 fine; and wire fraud, which carries a maximum prison term of 20 years and a $250,000 fine. The indictment also contains a forfeiture money judgment in the amount of at least $845,000, such amount constituting the fraudulent proceeds of the loan scheme.
The charges contained in the indictment are allegations. The defendant is innocent until proven guilty beyond reasonable doubt in a court of law.
In making today’s announcement, U.S. Attorney Murray credited the Charlotte Division of the FBI the SBA’s Office of the Inspector General for the investigation of this case.
Assistant U.S. Attorney Daniel Ryan, of the U.S. Attorney’s Office in Charlotte, is prosecuting the case.
If you believe you are a victim or have information related to this case, please contact the FBI at 704-672-6100, and select option 2 when prompted.
Founder and Chairman of a Multinational Investment Company and a Company Consultant Convicted of Bribery and Public Corruption are Sentenced to PrisonRead the Press Release
The founder and chairman of a multinational investment company and a company consultant were sentenced to prison today for orchestrating a bribery scheme involving independent expenditure accounts and improper campaign contributions.
Greg E. Lindberg, 50, of Durham, North Carolina, the founder and chairman of Eli Global LLC (Eli Global) and the owner of Global Bankers Insurance Group (GBIG), was sentenced to 87 months in prison and three years of supervised release. Lindberg’s consultant, John D. Gray, 70, of Chapel Hill, North Carolina, was ordered to serve 30 months in prison, followed by two years of supervised release. Lindberg and Gray were also ordered to pay forfeiture in the amount approximately $1.45 million held in accounts established by the defendants for the purpose of funneling the bribe payments.
On March 5, 2020, a federal jury convicted Lindberg and Gray of conspiracy to commit honest services wire fraud and bribery concerning programs receiving federal funds following an approximately three-week trial. U.S. District Judge Max O. Cogburn Jr. presided over the trial and today’s sentencing hearings.
Co-defendant, Robert Cannon Hayes, 74, of Concord, North Carolina, was also sentenced today to a one-year probationary term. Hayes previously pleaded guilty to making false statements to the FBI and agreed to cooperate with the government’s investigation.
“When Greg Lindberg and John Gray offered millions of dollars in bribes to the North Carolina Insurance Commissioner, they referred to their elaborately corrupt scheme as a ‘win-win’ – unaware that the FBI was watching and listening,” said Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division. “Today, both men have been held accountable for their crimes, and their sentences underscore the Department of Justice's unyielding commitment to rooting out corruption wherever we find it.”
“Lindberg and his accomplices, driven by greed, devised an extensive political bribery scheme to illegally funnel millions of dollars to an elected official for the benefit of Lindberg’s business interests. To this day, Lindberg and Gray remain unremorseful and refuse to accept responsibility for their criminal actions. The severity of their brazen conduct is reflected in the Court’s sentence,” said U.S. Attorney Andrew Murray for the Western District of North Carolina. “Bribery of a public official is far from a victimless crime. It is our duty to the American people to stop bad actors with deep pockets and unscrupulous intentions from wrecking the foundation on which this country proudly stands. To those that greedily seek to line their own pockets through deceit and fraud, I offer the following advice: Keep a travel toothbrush handy.”
“When the prison bars close behind Mr. Lindberg and Mr. Gray, they will hear the sound of justice, loud and clear,” said Special Agent in Charge John Strong of the FBI’s Charlotte Field Office. “The FBI will root out any and all forms of public corruption. We remain committed to ensuring those who attempt to interfere with the integrity of our democratic process pay the price.”
According to filed court documents, evidence presented at trial, and today’s sentencing hearings, in January 2018, the elected Commissioner (Commissioner) of the North Carolina Department of Insurance (NCDOI) reported concerns to the FBI about political contributions and other requests made by Lindberg and Gray, and agreed to cooperate with the federal investigation that was initiated.
According to evidence presented at trial, from April 2017 to August 2018, Lindberg and Gray engaged in a bribery scheme involving independent expenditure accounts and improper campaign contributions for the purpose of causing the Commissioner to take official action favorable to Lindberg’s company, GBIG. Trial evidence established that Lindberg and Gray gave, offered, and promised the Commissioner millions of dollars in campaign contributions and other things of value, in exchange for the removal of NCDOI’s Senior Deputy Commissioner, who was responsible for overseeing regulation and the periodic examination of GBIG.
According to trial evidence, Lindberg, Gray and the Commissioner held numerous in-person meetings at different locations, including in Statesville, North Carolina, and had telephonic and other communications with each other, and others, to discuss Lindberg’s request for the personnel change in exchange for millions of dollars, and to devise a plan on how to funnel campaign contributions to the Commissioner anonymously. In order to conceal the bribery scheme, at the direction of Lindberg, two corporate entities were set-up to form an independent expenditure committee with the purpose of supporting the Commissioner’s re-election campaign, and Lindberg funded the entities with $1.5 million as promised to the Commissioner. In addition, at Lindberg and Gray’s direction, Hayes caused the transfer of $250,000 from monies Lindberg had previously contributed to a North Carolina state party of which Hayes was chairman, to the Commissioner’s re-election campaign.
According to admissions Hayes made in connection with his guilty plea, on or about Aug. 28, 2018, Hayes falsely stated to FBI agents that he had never spoken with the NCDOI Commissioner about personnel or personnel problems at NCDOI, or about Lindberg or Gray. Hayes further admitted that, at the time he made the materially false statements, Hayes knew that it was unlawful to lie to the FBI, and knew that his statements were false because Hayes had in fact spoken with the NCDOI Commissioner about Lindberg and Gray, and about Lindberg’s request that the Commissioner move certain personnel within NCDOI.
The FBI’s Charlotte field office investigated the case.
Trial Attorney James C. Mann of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorneys William T. Stetzer and Dana O. Washington of the U.S. Attorney’s Office for the Western District of North Carolina prosecuted the case.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Founder and Chairman of A Multinational Investment Company and A Company Consultant Convicted of Bribery and Public Corruption Are Sentenced to PrisonRead the Press Release
CHARLOTTE, N.C. – The founder and chairman of a multinational investment company and a company consultant were sentenced to prison today for orchestrating a bribery scheme involving independent expenditure accounts and improper campaign contributions.
Greg E. Lindberg, 50, of Durham, North Carolina, the founder and chairman of Eli Global LLC (Eli Global) and the owner of Global Bankers Insurance Group (GBIG), was sentenced to 87 months in prison and three years of supervised release. Lindberg’s consultant, John D. Gray, 70, of Chapel Hill, North Carolina, was ordered to serve 30 months in prison, followed by two years of supervised release. Lindberg and Gray were also ordered to pay forfeiture in the amount approximately $1.45 million held in accounts established by the defendants for the purpose of funneling the bribe payments.
On March 5, 2020, a federal jury convicted Lindberg and Gray of conspiracy to commit honest services wire fraud and bribery concerning programs receiving federal funds following an approximately three-week trial. U.S. District Judge Max O. Cogburn Jr. presided over the trial and today’s sentencing hearings.
Co-defendant, Robert Cannon Hayes, 74, of Concord, North Carolina, was also sentenced today to a one-year probationary term. Hayes previously pleaded guilty to making false statements to the FBI and agreed to cooperate with the government’s investigation.
“When Greg Lindberg and John Gray offered millions of dollars in bribes to the North Carolina Insurance Commissioner, they referred to their elaborately corrupt scheme as a ‘win-win’ – unaware that the FBI was watching and listening,” said Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division. “Today, both men have been held accountable for their crimes, and their sentences underscore the Department of Justice's unyielding commitment to rooting out corruption wherever we find it.”
“Lindberg and his accomplices, driven by greed, devised an extensive political bribery scheme to illegally funnel millions of dollars to an elected official for the benefit of Lindberg’s business interests. To this day, Lindberg and Gray remain unremorseful and refuse to accept responsibility for their criminal actions. The severity of their brazen conduct is reflected in the Court’s sentence,” said U.S. Attorney Andrew Murray for the Western District of North Carolina. “Bribery of a public official is far from a victimless crime. It is our duty to the American people to stop bad actors with deep pockets and unscrupulous intentions from wrecking the foundation on which this Country proudly stands. To those that greedily seek to line their own pockets through deceit and fraud, I offer the following advice: Keep a travel toothbrush handy.”
“When the prison bars close behind Mr. Lindberg and Mr. Gray, they will hear the sound of justice, loud and clear,” said Special Agent in Charge John Strong of the FBI’s Charlotte Field Office. “The FBI will root out any and all forms of public corruption. We remain committed to ensuring those who attempt to interfere with the integrity of our democratic process pay the price.”
According to filed court documents, evidence presented at trial, and today’s sentencing hearings, in January 2018, the elected Commissioner (Commissioner) of the North Carolina Department of Insurance (NCDOI) reported concerns to the FBI about political contributions and other requests made by Lindberg and Gray, and agreed to cooperate with the federal investigation that was initiated.
According to evidence presented at trial, from April 2017 to August 2018, Lindberg and Gray engaged in a bribery scheme involving independent expenditure accounts and improper campaign contributions for the purpose of causing the Commissioner to take official action favorable to Lindberg’s company, GBIG. Trial evidence established that Lindberg and Gray gave, offered, and promised the Commissioner millions of dollars in campaign contributions and other things of value, in exchange for the removal of NCDOI’s Senior Deputy Commissioner, who was responsible for overseeing regulation and the periodic examination of GBIG.
According to trial evidence, Lindberg, Gray and the Commissioner held numerous in-person meetings at different locations, including in Statesville, North Carolina, and had telephonic and other communications with each other, and others, to discuss Lindberg’s request for the personnel change in exchange for millions of dollars, and to devise a plan on how to funnel campaign contributions to the Commissioner anonymously. In order to conceal the bribery scheme, at the direction of Lindberg, two corporate entities were set-up to form an independent expenditure committee with the purpose of supporting the Commissioner’s re-election campaign, and Lindberg funded the entities with $1.5 million as promised to the Commissioner. In addition, at Lindberg and Gray’s direction, Hayes caused the transfer of $250,000 from monies Lindberg had previously contributed to a North Carolina state party of which Hayes was chairman, to the Commissioner’s re-election campaign.
According to admissions Hayes made in connection with his guilty plea, on or about Aug. 28, 2018, Hayes falsely stated to FBI agents that he had never spoken with the NCDOI Commissioner about personnel or personnel problems at NCDOI, or about Lindberg or Gray. Hayes further admitted that, at the time he made the materially false statements, Hayes knew that it was unlawful to lie to the FBI, and knew that his statements were false because Hayes had in fact spoken with the NCDOI Commissioner about Lindberg and Gray, and about Lindberg’s request that the Commissioner move certain personnel within NCDOI.
The FBI’s Charlotte field office investigated the case.
Trial Attorney James C. Mann of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorneys William T. Stetzer and Dana O. Washington of the U.S. Attorney’s Office for the Western District of North Carolina prosecuted the case.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Convicted Felon Is Sentenced to More Than Six Years for Illegal Possession of A FirearmRead the Press Release
CHARLOTTE, N.C. – U.S. Attorney Andrew Murray announced that Takobie Anderson, 20, of Charlotte, was sentenced in federal court late yesterday for illegally possessing a firearm. U.S. District Judge Frank D. Whitney ordered Anderson to serve 82 months in prison, followed by two years of supervised release.
U.S. Attorney Murray is joined in making today’s announcement by Vincent C. Pallozzi, Special Agent in Charge of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Charlotte Field Division, and Chief Johnny Jennings of the Charlotte Mecklenburg Police Department (CMPD).
According to filed court documents and yesterday’s sentencing hearing, on April 21, 2019, CMPD officers were dispatched to an apartment complex in Charlotte, in response to a report of a shooting. When the officers arrived at the scene they determined that two individuals, a male and a female, had been shot and had sustained injuries. Over the course of the investigation, law enforcement determined that Anderson had shot the two victims following a verbal altercation between the victims and a relative of Anderson. Court records show that, at the time of the shooting, Anderson was on probation for a state conviction and was wearing an ankle monitor. Law enforcement arrested Anderson on August 23, 2019, at a residence in Charlotte. At the time of Anderson’s arrest, law enforcement located inside the residence a loaded firearm, which they later determined had been stolen and was the firearm Anderson had used to shoot the victims. According to court records, Anderson has a previous felony conviction and he is prohibited from possessing a firearm and/or ammunition.
Anderson is in federal custody. He will be transferred to the custody of the Federal Bureau of Prisons upon the designation of a federal facility.
The investigation was handled by the ATF and CMPD. The case was prosecuted by Assistant United States Attorney Caryn Finley of the U.S. Attorney’s Office in Charlotte.
Leader and Two Co-Conspirators of Methamphetamine Trafficking Ring Are Sentenced to PrisonRead the Press Release
CHARLOTTE, N.C. – U.S. District Judge Frank D. Whitney sentenced to prison the leader of a methamphetamine trafficking ring and his two co-conspirators today, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.
William Andrew Reel, II, 40, of Bessemer City, N.C., was ordered to serve 30 years in prison and five years of supervised release. Reel pleaded guilty to drug conspiracy and possession with intent to distribute methamphetamine.
Kateland Dawn Myers, 25, of Bessemer City, N.C., was sentenced to 151 months in prison, followed by five years of supervised release. Myers pleaded guilty to drug conspiracy and distribution and possession with intent to distribute methamphetamine.
Matthew Lloyd Thomas, 32, of Dallas, N.C. was ordered to serve 151 months in prison, and five years of supervised release. Thomas previously pleaded guilty to drug conspiracy, distribution and possession with intent to distribute methamphetamine, and possession of a firearm by a felon.
According to filed court documents and today’s sentencing hearings, from at least September 2018 to March 2019, Reel conspired with others to traffic large quantities of methamphetamine from Georgia into North Carolina, which Reel, Myers, and Thomas then distributed locally in Gaston County and elsewhere. Court records show that Reel, assisted by Myers and Thomas, was responsible for trafficking at least 30 kilograms of methamphetamine. Over the course of the investigation law enforcement seized methamphetamine, three firearms, and more than $ 64,171 in drug proceeds.
In making the announcement, U.S. Attorney Murray thanked the DEA and the Gaston County Police Department for handling the investigation.
Assistant U.S. Attorney Christopher Hess, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.
Graham, N.C. Man Is Sentenced to More Than Five Years for $1.1 Million Investment SchemeRead the Press Release
ASHEVILLE, N.C. – U.S. Attorney Andrew Murray announced that on Thursday, August 13, 2020, Mark Colin Ramsey, 50, of Graham, N.C., was sentenced to 65 months in prison for operating a $1.1 million investment scheme. U.S. District Judge Martin Reidinger also ordered Ramsey to serve three years of supervised release and to pay restitution in the amount of $1,098,333.92.
North Carolina Secretary of State Elaine F. Marshall joins U.S. Attorney Murray in making today’s announcement.
According to filed court documents and statements made in court, from April 2008 to September 2013, Ramsey defrauded more than 20 victims out of nearly $1.1 million through a fraudulent investment scheme. Court records show that Ramsey operated various purported investment companies, including Hypertrend, Cascade Investments, GH Gardner, Layton-McCall, Pandrox, and Good Living. Ramsey induced victim-investors by falsely representing that their money would be used to make legitimate investments. He also promised his victims that they would receive a guaranteed return on their investments, and that their principal investments would not be at risk. During the relevant time period, Ramsey used multiple purported investment corporations, as well as numerous fraudulent documents, including false Form-1099s, fake investment agreements, and fabricated stock certificates, to convince potential victims his investments were legitimate and profitable. To further induce victims, court records reflect that Ramsey showed potential investors documents purportedly backing up his claim that he had made one million dollars from a ten thousand dollar investment.
According to court records, Ramsey failed to disclose to his victims, some of whom were at or near retirement age, that he was not registered to sell securities in the State of North Carolina, or that the investment opportunities he presented were not registered as required by statute. Rather than invest the victims’ money as promised, Ramsey spent the investors’ money on Ponzi-style payments to other investors and to fund his personal lifestyle.
On August 26, 2019, Ramsey pleaded guilty to securities fraud. In making today’s announcement, U.S Attorney Murray thanked the Securities Division of the North Carolina Department of the Secretary of State for their investigation of this case.
Assistant U.S. Attorney Daniel Bradley, of the U.S. Attorney’s Office in Asheville, prosecuted the case.
In March 2019, Andrew Murray, U.S. Attorney for the Western District of North Carolina, announced the Office’s Elder Justice Initiative, which aims to combat elder financial exploitation by expanding efforts to investigate and prosecute financial scams that target seniors; educate older adults on how to identify scams and avoid becoming victims of financial fraud; and promote greater coordination with law enforcement partners. For more information please visit: /usao-wdnc/elder-justice-initiative
Georgia Man Is Sentenced to More Than 19 Years for Trafficking MethamphetamineRead the Press Release
CHARLOTTE, N.C. – Braudio Mendoza, 33 of Atlanta, Georgia, was sentenced to 235 months in prison and five years of supervised release late yesterday for trafficking methamphetamine, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.
According to court records, from at least as early as 2018 to March 2019, Mendoza was involved in a drug conspiracy that trafficked large quantities of methamphetamine from Georgia into Western North Carolina. Court records show that law enforcement identified Mendoza as a source of supply of the methamphetamine, and he coordinated drug deliveries into North Carolina. Over the course of the investigation, law enforcement determined that Mendoza was responsible for trafficking more than 4.5 kilograms of high-purity methamphetamine, also known as “ice”.
On February 22, 2019, Mendoza pleaded guilty to two counts of possession with intent to distribute methamphetamine. He is currently in federal custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.
\Mendoza was charged as part of an ongoing Organized Crime Drug Enforcement Task Force (OCDETF) investigation codenamed “Dixie Crystal.” Since 2015, more than 200 individuals have been prosecuted as a result of the Dixie Crystal investigation, and the drug trafficking organizations involved have trafficked methamphetamine worth millions of dollars. Over the course of the investigation, law enforcement have seized far in excess of 20 kilograms of crystal methamphetamine, $500,000 in U.S. currency and other assets, and dozens of firearms.
\OCDETF is a joint federal, state and local cooperative approach to combat drug trafficking and is the nation’s primary tool for disrupting and dismantling major drug trafficking organizations, targeting national and regional drug trafficking organizations and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets.
Mendoza’s case was investigated by the ICE-Homeland Security Investigations, with assistance from the North Carolina State Bureau of Investigation, Gastonia Police Department, Gaston County Police Department, Huntersville Police Department, Mooresville Police Department, Cleveland County Sheriff’s Office, Alexander County Sheriff’s Office, Davie County Sheriff’s Office, Mocksville Police Department, and the Charlotte-Mecklenburg Police Department. Assistant U.S. Attorney Steven Kaufman prosecuted the case.
Anson County Man Is Sentenced to More Than 13 Years for Child PornographyRead the Press Release
CHARLOTTE, N.C. – On Monday, August 10, 2020, U.S. District Judge Frank D. Whitney sentenced Jeremy McQuage, 41, of Morven, N.C. to 160 months in prison on child pornography charges, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. Morven was also ordered to serve a lifetime of supervised release, and to register as a sex offender after he completes his prison term.
Joining U.S. Attorney Murray in making today’s announcement is John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division.
On December 18, 2019, McQuage pleaded guilty to distribution, receipt and possession of child pornography. According to court documents and today’s sentencing hearing, in February 2019, over the course of an investigation into BitTorrent peer-to-peer file sharing network, the FBI discovered that an individual, later identified as McQuage, was downloading child pornography, including videos and images of infants being sexually abused. On March 14, 2019, the FBI executed a search warrant at the residence where the internet had been used to access and download the child pornography. While there, FBI agents learned that McQuage did not reside there but would often park in the driveway of the residence and use the wifi to connect to the internet. FBI agents located McQuage and seized his cellular phone. A forensic analysis of the device revealed that McQuage possessed hundreds of images and videos of children, including infants and toddlers, being sexually abused. According to court records, in addition to downloading child pornography, McQuage also used BitTorrent to distribute and share the child pornography with others.
In announcing today’s sentence, Judge Whitney said that the court was troubled by the quantity and the gravity of the images and videos, and that McQuage’s conduct helped feed and facilitate a global market of abuse. Judge Whitney noted that the victimization of the minors in the videos and images was extraordinary and that the lengthy sentence was needed to deter others from committing similar crimes.
McQuage is in federal custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.
The case was investigated by the FBI. Assistant U.S. Attorney Emily Wasserman and Special Assistant U.S. Attorney Stephanie Spaugh prosecuted the case.
The case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ offices and the Criminal Division’s Child Exploitation and Obscenity Section (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.
Former Buncombe County Commissioner Pleads Guilty to Federal Conspiracy ChargeRead the Press Release
ASHEVILLE, N.C. – Former Buncombe County Commissioner Ellen Madans Frost, 65, of Black Mountain, N.C., appeared in federal court today and pleaded guilty to conspiracy to commit federal program fraud, for her involvement in a scheme to use Buncombe County funds to sponsor equestrian activities in North Carolina and Florida, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.
John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division; Director Robert Schurmeier of the North Carolina State Bureau of Investigation (SBI); and Matthew D. Line, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division, Charlotte Field Office (IRS-CI), join U.S. Attorney Murray in making today’s announcement.
According to filed court documents and today’s plea hearing, Frost was elected as Commissioner for Buncombe County (the County) in November 2012, and continued to serve until December 2018. Beginning in early 2014 through November 2017, Frost conspired with former County Manager, Wanda Skillington Greene, to execute a scheme to defraud the County by misapplying funds allocated to the County’s Economic Development Program to support various equestrian enterprises in North Carolina and Florida, specifically, the Tryon International Equestrian Center (the Tryon Center) located in Polk County, and its affiliate, the Palm Beach International Equestrian Center located in Wellington, Florida.
According to court documents, in or about 2014, Frost began to speak with Greene about Frost’s desire to support the Tryon Center and related equestrian activities on behalf of the County. As a result, Frost and Greene developed a scheme to enter into sponsorship and advertising contracts with the Tryon Center, the Palm Beach International Equestrian Center, and affiliated equestrian enterprises. To pay for the associated expenses, Wanda Greene proposed using monies from the County’s Economic Development Incentive Fund. The equestrian enterprises were unaware of the criminal nature of the scheme, including the lack of authorization for Frost and Greene to enter into these negotiations and agreements without the knowledge and approval of the Board of Commissioners, as required by State law.
Greene and Frost took steps to cover the fraudulent scheme and to hide the County’s involvement in these unauthorized sponsorship and advertising contracts, by using the funds to promote the Asheville Regional Airport (the Airport), even though the Airport is an independent entity not governed or funded by the County. In an effort to conceal the fact that the County was the funding source, Greene and Frost ensured that the contracting parties understood that all sponsored events, signage, and advertisements would bear the name and logo of the Asheville Regional Airport, and that no signage or advertisements would be in the name of Buncombe County, even though the County was the paying sponsor.
According to court documents the County’s sponsorship contracts guaranteed access to amenities at the two equestrian venues exclusive to high-level sponsors. Specifically, the Tryon Center contract included access to a “Members Only” VIP table in an area known as the Legends Club. Entrance to the Legends Club and use of the VIP table was limited to persons whose names were on the admission list. Court records show that Frost ordinarily served as the contact person and approved the use of the County-funded table at the Legends Club. Furthermore, during the 2015 and 2016 seasons at the Tryon Center, Frost repeatedly used the VIP table, and invited her friends and other guests to attend the events.
Following Greene’s retirement in June 2017, County employees discovered the County’s payments to the equestrian enterprises. In August 2017, the Board of Commissioners learned of the number and amounts of these payments, when the new County Manager informed the Board of the payments county employees had discovered.
Following her plea hearing, Frost was released on bond. The federal program fraud conspiracy charge carries a maximum penalty of five years in prison. A sentencing date for Frost has not been set.
In making today’s announcement U.S. Attorney Murray commended the FBI, IRS-CI and the SBI for their investigation of this case.
Assistant United States Attorneys Richard Edwards and Don Gast of the U.S. Attorney’s Office in Asheville are prosecuting the case.
Hickory Man Is Sentenced to Nine Years for Trafficking Narcotics on the Dark WebRead the Press Release
CHARLOTTE, N.C. – U.S. Attorney Andrew Murray announced today that Travis Justin Stout, 36, of Hickory, N.C., was sentenced to 108 months in prison and three years of supervised release for drug trafficking conspiracy and possession with intent to distribute narcotics on the Dark Web. The sentencing was held on Thursday, August 6, 2020.
Ronnie Martinez, Special Agent in Charge of ICE/Homeland Security Investigations (HSI) in Georgia and the Carolinas, Tommy D. Coke, Inspector in Charge of the Atlanta Division of the U.S. Postal Inspection Service, which oversees Charlotte, and Chief Thurman Whisnant of the Hickory Police Department join U.S. Attorney Murray in making today’s announcement.
According to information contained in filed court documents and the sentencing hearing, in 2016, law enforcement began investigating Stout for trafficking narcotics in the greater Hickory area. Over the course of the investigation, law enforcement determined that Stout was purchasing narcotics, including MDMA (Ecstasy), methamphetamine, amphetamine, and marijuana, on the Dark Web, using various forms of cryptocurrency. Court records show that Stout also used the Dark Web to traffic narcotics throughout the United States and internationally, including on the AlphaBay Market, and stored the drug proceeds in multiple virtual currency wallets. Stout trafficked narcotics from the Netherlands and Belgium, among other locations, in this conspiracy.
In handing down Stout’s sentence, Judge Bell stated this was an extremely sophisticated international drug trafficking case, involving the Dark Web, and noted this sentence will deter others from completing similar sophisticated Dark Web crimes.
Stout is currently in custody and will be transferred to the custody of the federal Bureau of Prisons.
In making today’s announcement U.S. Attorney Murray thanked HSI in Charlotte, USPIS, and the Hickory Police Department for their investigation on this case.
Assistant U.S. Attorneys Sanjeev Bhasker and Seth Johnson of the U.S. Attorney’s Office in Charlotte prosecuted the case.
Former School Teacher Is Sentenced to Six Years for Receiving Child PornographyRead the Press Release
CHARLOTTE, N.C. – On Thursday, August 6, 2020, U.S. District Judge Kenneth D. Bell sentenced a former teacher for receiving child pornography, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. Christopher David Muggler, 27, of Indian Trail, N.C. was sentenced to six years in prison and 10 years of supervised release. He was also ordered to register as a sex offender after he completes his prison term.
Joining U.S. Attorney Murray in making today’s announcement is John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division.
On February 28, 2020, Muggler, a former teacher at Covenant Day School in Matthews, N.C., pleaded guilty to receiving child pornography. According to filed court documents and yesterday’s sentencing hearing, FBI agents conducting an investigation into child exploitation became aware that an individual with the username “Muggadelphia12” was receiving child pornography via Dropbox links, specifically videos that depicted young male victims being sexually abused. Law enforcement linked the username “Muggadelphia12” to Muggler. On March 26, 2019, FBI agents executed a warrant at Muggler’s residence and seized Muggler’s two cell phones. At sentencing, Muggler was found to possess 110 images and 34 videos of child pornography.
Mugger is in federal custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.
The case was investigated by the FBI. Assistant U.S. Attorney Alfredo De La Rosa, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.
The case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ offices and the Criminal Division’s Child Exploitation and Obscenity Section (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.
Federal Judge Sentences Cherokee Man for Stabbing Victim with a KnifeRead the Press Release
ASHEVILLE, N.C. – George Allan Lambert, 48, of Cherokee, N.C., and an Enrolled Member of the Eastern Band of Cherokee Indians, was sentenced to today to 45 months in prison and three years of supervised release for stabbing a victim with a knife, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. On November 5, 2019, a jury convicted Lambert of assault resulting in serious bodily injury, and assault with a dangerous weapon with intent to do bodily harm.
Chief Doug Pheasant of the Cherokee Indian Police Department (CIPD) joins U.S. Attorney Murray in making today’s announcement.
According to filed documents, evidence presented at trial and witness testimony, on May 2, 2019, Lambert and the victim were visiting a residence in Swain County, within Indian Country. Over the course of the evening, Lambert quarreled with the victim, after Lambert accused the victim of stealing his money. During the argument, Lambert took out a knife and stabbed and sliced the victim multiple times in his shoulder and torso area. According to court records, the victim sustained heavy blood loss and required emergency surgery and more than 30 stitches as a result of the wounds inflicted by Lambert. Following the stabbing incident, Lambert fled the scene. CIPD arrested Lambert shortly thereafter.
Lambert is currently in federal custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.
In making today’s announcement, U.S. Attorney Murray thanked CIPD for their investigation of this case.
Assistant United States Attorney John Pritchard, of the U.S. Attorney’s Office in Asheville, prosecuted the case.
Asheville Resident Is Sentenced to 14 Years for Transporting Child PornographyRead the Press Release
ASHEVILLE, N.C. – Today, Chief U.S. District Judge Martin Reidinger sentenced Mance Lee Ruvolo, 41, of Asheville, to 168 months in prison on transportation of child pornography charges, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. Ruvolo was also ordered to serve a lifetime of supervised release and to register as a sex offender after he is released from prison.
Ronnie Martinez, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) in North Carolina, and Robert Schurmeier, Director of the North Carolina State Bureau of Investigation (SBI), join U.S. Attorney Murray in making today’s announcement.
According to filed documents and statements made in court, on July 13, 2018, law enforcement became aware that an individual was using an e-mail address to upload images containing child pornography. Law enforcement identified the email account user as Ruvolo, and positively linked to Ruvolo the cell phone used to upload the child pornography. Court documents also show that a review of Ruvolo’s email account revealed additional images and videos of child exploitation, including videos and images of prepubescent children being sexually abused. Ruvolo pleaded guilty to transportation of child pornography on January 3, 2020.
Ruvolo is currently in custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.
U.S. Attorney Murray thanked HSI and SBI for handling the investigation.
Special Assistant U.S. Attorney (SAUSA) Alexis Solheim, with the U.S. Attorney’s Office in Asheville, prosecuted the case. Ms. Solheim is a state prosecutor with the office of the 43rd Prosecutorial District, and was assigned by District Attorney Ashley Welch to serve as a SAUSA with the U.S. Attorney’s Office in Asheville. Ms. Solheim is duly sworn in both state and federal courts. The SAUSA position is a reflection of the partnership between the office of the 43rd Prosecutorial District and the United States Attorney’s Office.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in 2006 by the Department of Justice, aimed at combating the growing online sexual exploitation of children. By combining resources, federal, state and local agencies are better able to locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue those victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Union County Man Is Sentenced to Five Years in Prison for Making A False Statement to the FBIRead the Press Release
CHARLOTTE, N.C. – Alexander Samuel Smith, 32, of Waxhaw, N.C., was sentenced to 60 months in prison late yesterday, for making a false statement to the FBI, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. Chief U.S. District Judge Max O. Cogburn Jr. also ordered Smith to serve three years under court supervision upon completion of his prison term. As a special condition of Smith’s supervised release, the Court ordered the defendant to have no contact with any organization or person on the State Department’s designated terrorist list.
John A. Strong, Special Agent in Charge of the FBI in North Carolina joins U.S. Attorney Murray in making today’s announcement.
According to filed court documents, evidence presented at trial and yesterday’s sentencing hearing, in February 2016, Smith lied during an interview with the FBI about his plans to travel to Syria to join the Islamic State of Iraq and al-Sham (ISIS), and about providing assistance to other individuals to do the same. Specifically, as trial evidence established, Smith denied purchasing a “buddy pass,” which is a discounted airfare offered to airline employees, for an individual he believed wanted to exit the United States and ultimately join ISIS in Syria.
In announcing the sentence, Judge Cogburn said that Smith was “ready, willing and able to help a terrorist organization,” and that the sentence was designed in part to deter people from lying to protect terrorists.
On March 21, 2019, a federal jury convicted Smith of two counts of making a false statement to the FBI. Smith is currently in federal custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.
The case was investigated by the FBI. Assistant U.S. Attorney Michael Savage of the U.S. Attorney’s Office in Charlotte prosecuted the case.
Jury Convicts South Carolina Man for Credit Card FraudRead the Press Release
CHARLOTTE, N.C. – A federal jury in Charlotte convicted Robert Nathaniel Johnson, III, 35, of Lancaster, South Carolina today for credit card fraud, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. U.S. District Judge Max O. Cogburn Jr. presided over the trial.
Reginald A. DeMatteis, Special Agent in Charge of the United States Secret Service, Charlotte Field Office, joins U.S. Attorney Murray in making today’s announcement.
According to filed court documents and evidence presented at trial, from September 29 to October 20, 2018, Johnson and his co-defendant, Charles Vincent Brown, used a stolen credit card number to create counterfeit credit cards, which they then used to purchase more than $250,000 of merchandise, including electronics, sneakers, clothing and gaming equipment. Trial evidence established that the defendants obtained the credit card of an individual identified as Victim #1, and re-encoded the stolen credit card number onto counterfeit credit cards bearing the defendants’ names and the names of other co-conspirators. According to evidence presented at trial, Johnson and others used the counterfeit credit cards at multiple retail stores, including at Best Buy, Foot Action, Foot Locker, and Neiman Marcus. Johnson specifically used the counterfeit credit cards to buy more than $10,000 in sneakers and apparel.
The jury convicted Johnson of conspiracy to commit access device fraud, which carries a maximum prison sentence of five years, and access device fraud, which carries a maximum sentence of 10 years in prison. A sentencing date for Johnson has not been set. On November 4, 2019, Brown pleaded guilty to conspiracy to commit access device fraud and is currently awaiting sentencing.
In making today’s announcement, U.S. Attorney Murray thanked the U.S. Secret Service for their investigation of this case.
Assistant U.S. Attorneys Caryn Finley and Stephanie Spaugh, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.
Seven North Carolina Tax Preparers Charged with FraudRead the Press Release
WASHINGTON – A federal grand jury in Charlotte, North Carolina returned an indictment yesterday, charging three Charlotte tax preparers with conspiring to defraud the United States, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and First Assistant U.S. Attorney William Stetzer for the Western District of North Carolina.
Four additional Charlotte tax preparers also named in yesterday’s indictment previously were charged with conspiring to defraud the United States in separate charging documents filed earlier this week.
According to the indictment, Joseph Octave owned and operated Kapital Financial Services, a tax return preparation business with two offices located in Charlotte, North Carolina. From 2014 through at least 2019, Octave and his employees, including Vonyeda Carson, Wendia Courtois, Whitney Vargas-Medrano, Melissa Greene, Natisha Holloman, and Kimberly Joline allegedly conspired to falsify clients’ tax returns by claiming deductions, business losses, American Opportunity credits, education credits, and earned income tax credits that the clients did not incur, in order to fraudulently increase refunds to be paid by the IRS. The indictment further charges that during some of these years, Carson and Courtois filed false tax returns in their own names.
Octave, Carson, and Courtois were charged in yesterday’s indictment. Joline, Holloman, Greene, and Vargas-Medrano were named in yesterday’s indictment but were separately charged by criminal informations filed on July 20, 2020.
If convicted, each defendant faces a maximum sentence of five years in prison on the conspiracy charge. Octave, Carson, and Courtois additionally face a maximum sentence of three years in prison on each count of aiding and assisting in the preparation of a false tax return. Carson and Courtois also face a maximum sentence of three years in prison for filing their own false tax returns. The defendants also face a period of supervised release, restitution, and monetary penalties.
An indictment or information merely alleges that crimes have been committed. The defendants are presumed innocent until proven guilty beyond a reasonable doubt.
Principal Deputy Assistant Attorney General Zuckerman and First Assistant U.S. Attorney Stetzer commended special agents of IRS-Criminal Investigation, who conducted the investigation, and Trial Attorney Brian Flanagan of the Tax Division and Assistant U.S. Attorney Caryn Finley, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Seven Charlotte Tax Return Preparers Are Charged for Conspiring to Defraud the IRSRead the Press Release
CHARLOTTE, N.C. – This week, the U.S. Attorney’s Office has charged seven Charlotte tax return preparers for conspiring to defraud the IRS.
Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and Matthew D. Line, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division, Charlotte Field Office (IRS-CI), join the U.S. Attorney’s Office in making today’s announcement.
A federal grand jury sitting in Charlotte returned a 20-count indictment yesterday, charging Joseph Octave, 47, Vonyeda Carson, 36, and Wendia Courtois, 44, all of Charlotte, with conspiring to defraud the United States, aiding and assisting in the preparation of false tax returns for their clients, and in some cases filing false personal tax returns. The indictment also identifies four other tax preparers who were charged earlier this week by criminal informations with conspiracy to defraud the United States. They are, Melissa Greene, 39, Natisha Holloman, 41, Kimberly Joline 30, and Whitney Vargas-Medrano, 31, also from Charlotte.
According to the filed charging documents, Joseph Octave owned and operated Kapital Financial Services, a tax return preparation business with two offices located in Charlotte. Since 2014, Octave and his employees, including Carson, Courtois, Vargas-Medrano, Greene, Holloman, and Joline conspired to defraud the United States by preparing and filing tax returns on behalf of clients that claimed fabricated and fraudulent items, including Schedule A deductions, Schedule C business income and losses, American Opportunity credits, education credits, and earned income tax credits. Octave, Greene, Joline, and Vargas-Medrano trained Kapital Financial Services employees to falsify federal income tax returns. The training material provided to employees included scripts and cheat sheets. The indictment further alleges that Carson and Courtois filed false personal tax returns.
If convicted, the defendants face a maximum sentence of five years in prison on the conspiracy charge. Octave, Carson, and Courtois face a maximum of three years in prison on each of the counts alleging they aided and assisted in the preparation of false income tax returns. Carson and Courtois face a maximum sentence of three years on each of the counts alleging they signed and filed their own false tax returns.
The indictments and informations merely allege that crimes have been committed. The defendants are presumed innocent until proven guilty beyond a reasonable doubt.
In making today’s announcement the U.S. Attorney’s Office and Principal Deputy Assistant General Zuckerman commended special agents of IRS-Criminal Investigation, who conducted the investigation,
Assistant U.S. Attorney Caryn Finley and Trial Attorney Brian Flanagan of the Tax Division are prosecuting the case.
North Carolina Native Is Sentenced to Eight Years for Stealing Millions from MedicaidRead the Press Release
CHARLOTTE, N.C. – Today, U.S. District Judge Robert J. Conrad Jr. sentenced Tony Garrett Taylor, 40, a native and former resident of Harrisburg, North Carolina, currently residing in Brooklyn, N.Y., to 96 months in prison followed by two years of supervised release, for stealing more than $6.1 million from Medicaid and committing tax evasion, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. Tony Taylor was also ordered to pay $6,121,655 to North Carolina Medicaid and $1,124,603 to the U.S. Internal Revenue Service as restitution.
John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, Matthew D. Line, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division, Charlotte Field Office (IRS-CI), Tommy D. Coke, Inspector in Charge of the Atlanta Division of the U.S. Postal Inspection Service, which oversees Charlotte, and Attorney General Josh Stein, who oversees the North Carolina Medicaid Investigations Division (MID), join U.S. Attorney Murray in making today’s announcement.
According to filed court documents and today’s sentencing hearing, from June 2015 to December 2017, Tony Taylor and his brother, Jerry Lewis Taylor, operated a scheme to defraud Medicaid of more $9.4 million by submitting false and fraudulent reimbursement claims for patient services that were either non-existent or mischaracterized to Medicaid. The brothers submitted the fraudulent claims through several companies they owned and/or operated, including Taylor Behavioral Health Center, LLC and Options Driven LLC, both located in Monroe, N.C.; Design for Change LLC located in Raleigh and elsewhere; and SHG Consultants, located in Gastonia, N.C. and elsewhere (collectively, the “Taylor businesses”). These entities specialized in providing outpatient behavioral health services to at-risk youth throughout North Carolina.
Court records show that, during the relevant time period, Tony Taylor recruited other co-conspirators to the scheme, including Ameera Ali, who provided billing services for the conspiracy and furnished Tony Taylor with prospective patient lists containing identifying information for eligible Medicaid beneficiaries. The beneficiary information obtained from Ali and others were used, in turn, to file fraudulent reimbursement claims for services that were never provided. To the extent that services were actually provided, the conspirators submitted to Medicaid fraudulent reimbursement claims that misrepresented the services rendered so as to obtain a higher reimbursement rate, a practice known as “upcoding.”
According to court documents, Tony Taylor also recruited Devon Rambert-Hairston, a licensed nurse practitioner and the director of one of the entities operated by the brothers, to review and sign-off on fictitious patient progress notes. Court records show that Rambert-Hairston never provided any behavioral health or medical services to the Medicaid beneficiaries or rarely interacted with them at all. To the extent that the beneficiaries received any treatment, those services were provided by an individual identified in court documents as J.B., who was not credentialed to provide those types of services.
Tony and Jerry Taylor also conspired with Christine Yvette Knight, who operated Connect and Move Staffing LLC in Florida. Knight’s role in the conspiracy was to create fraudulent treatment notes for the beneficiaries, and to prepare fake billing spreadsheets which were used by the brothers to further perpetuate the fraud.
During the course of the fraudulent scheme, Tony and Jerry Taylor caused hundreds of false and fraudulent claims to be submitted to Medicaid for false and fraudulent services. As a result, more than $9.4 million in fraudulent claims were submitted to Medicaid, resulting in approximately $6.1 million in fraudulent payments from Medicaid.
In addition to health care fraud, Tony Taylor also committed tax evasion, by failing to file timely and/or accurate U.S. Individual Income Tax Returns for tax years 2015, 2016, and 2017, and diverting fraudulent receipts from Medicaid to nominee entities and individuals. Tony Taylor also made personal expenditures using business accounts and Medicaid fraud proceeds, including spending more than $2.9 million for his “opulent lifestyle,” air fare, hotels, nightclubs, and shopping.
Tony Taylor pleaded guilty to health care fraud conspiracy and tax evasion. He is currently released on bond and upon designation of a federal facility he will report to the federal Bureau of Prisons to begin serving his sentence.
In announcing Tony Taylor’s sentence, Judge Conrad noted that Tony Taylor stole from programs designed to help disadvantaged children for personal gain and an opulent lifestyle.
Jerry Taylor is currently awaiting sentencing after pleading guilty to health care fraud conspiracy. Ameera Ali also pleaded guilty to health care fraud conspiracy and is currently awaiting sentencing. Devon Rambert-Hairston pleaded guilty to money laundering conspiracy and was sentenced to a year and a day in prison and a year of supervised release, and was ordered to pay $813,726 in restitution. Christine Yvette Knight pleaded guilty to making a false statement relating to health care matters. A sentencing date for Knight has not been set.
In making today’s announcement U.S. Attorney Murray thanked the FBI, the IRS, USPIS, and MID for their investigation of this case.
Assistant U.S. Attorneys Michael Savage and William Bozin of the U.S. Attorney’s Charlotte Office are prosecuting the case.
If you suspect Medicare or Medicaid fraud please report it by phone at 1-800-447-8477 (1-800-HHS-TIPS), or E-Mail at [email protected].
Convicted Felon Is Sentenced to More Than Five Years in Prison for Firearms OffenseRead the Press Release
CHARLOTTE, N.C. – U.S. District Judge Frank D. Whitney handed down a 68-month sentence Monday afternoon to Delmond Dmonta Cunningham for a firearms offense, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. In addition to the prison term imposed, Cunningham, 26, of Charlotte, was also ordered to serve three years under court supervision.
U.S. Attorney Murray is joined in making today’s announcement by Vincent C. Pallozzi, Special Agent in Charge of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Charlotte Field Division, and Chief Johnny Jennings of the Charlotte Mecklenburg Police Department (CMPD).
According to court documents and yesterday’s sentencing hearing, on August 30, 2018, at about 7:30 a.m., CMPD offices responded to a call regarding shots being fired near Villa Heights Elementary School in Charlotte. Court records show that a male, later identified as Cunningham, fired two shots at his ex-girlfriend and a relative, while they were in their vehicle dropping off the victim’s daughter at school. According to court documents, Cunningham followed the victim throughout the school parking lot, and once the victim left the parking lot Cunningham pointed a firearm out of his car window and fired two shots at the victim’s car. After the shots were fired, Cunningham fled the scene. Court records show that Cunningham has a history of domestic violence, and that, at the time of the incident, the victim had obtained a restraining order against him.
Over the course of the investigation, law enforcement determined that two .45 caliber shell casings were found in the school parking lot, which were later matched up with a stolen .45 caliber pistol found in Cunningham’s possession at the time of his arrest. One of the rounds fired penetrated a bedroom of a nearby house. Cunningham has a prior felony conviction and is prohibited from possessing a firearm or ammunition. On April 23, 2019, Cunningham pleaded guilty to possession of ammunition by a convicted felon. At yesterday’s sentencing hearing, Judge Whitney varied upward and imposed on Cunningham a sentence above the statutory guidelines.
At the sentencing hearing, in discussing the nature and circumstances of the offense, Judge Whitney described the defendant’s actions as “extraordinarily reckless” and noted that, luckily, “the round that went into another house did not hurt anyone.” Cunningham is currently in custody and will be transferred to the custody of the Federal Bureau of Prisons upon the designation of a federal facility.
The investigation was handled by the ATF and CMPD. The case was prosecuted by Assistant United States Attorney Robert Gleason of the U.S. Attorney’s Office in Charlotte.
U.S. Attorney's Office Partners with the FBI and AARP in North Carolina to Host Facebook Live Seminar About Online Romance Scams Targeting Older AdultsRead the Press Release
CHARLOTTE, N.C. – The U.S. Attorney’s Office for the Western District of North Carolina, in partnership with the FBI and the AARP in North Carolina, hosted a virtual informational seminar via Facebook Live today, to discuss the rise of online romance
scams targeting older adults and to offer tips on how to avoid becoming a victim of fraud, announced U.S. Attorney Andrew Murray.
Due to the COVID-19 pandemic, older adults are increasingly turning to the internet to obtain information, stay in touch with loved ones, connect with friends on social media, and form new romantic relationships. Scammers are taking advantage of older Americans’ increased online presence to perpetuate romance scams and steal elder victims’ money and identities, and, even worse, turn older adults into unwitting “money mules.” A money mule is a person that uses an existing or new bank account to conduct wire transfers or other types of financial transactions at the request of a scammer. Typically, the funds the money mules receive and engage in transactions with are proceeds of fraudulent schemes and, in many instances, the account holders are not aware they are being exploited as money mules to carry out financial fraud.
During today’s livestream presentation, Assistant U.S. Attorney and Elder Fraud Coordinator for the Western District Maria Vento, and Supervisory Special Agent for the FBI Brian Cyprian provided an overview of romance scams, money mule schemes and identity theft, and shared useful tips on how to spot those types of scams and how to avoid becoming a victim of fraud. Here are some of the tips shared with the audience:
- Be mindful of what information you post and make public online, as scammers can use details shared on social media and dating sites to better understand and target you.
- If someone contacts you and wants to start a romantic relationship with you, research the person’s photo and profile using online searches to see if the image, name, or details have been used elsewhere.
- Go slowly and ask lots of questions.
- Beware if the individual seems too perfect or quickly asks you to leave a dating service or social media site to communicate directly on your own phone or through a third party app.
- Beware if the individual attempts to isolate you from friends and family or requests inappropriate photos or financial information that could later be used to extort you.
- Beware if the individual promises to meet in person, but always comes up with excuses as to why he or she can’t.
- Never send money to anyone you have only communicated with online or by phone.
- If an online prospect claims to be a United States citizen living or working in another country and asks you for help or money, refer him or her to the local U.S. Embassy or Consulate. If you want to send money, consider using a U.S. Department of State Office of Overseas Citizens Services (OCS) Trust.
- Do not use your personal bank account to transfer money or conduct financial transactions at the direction of someone you met online.
- Do not give out personal information via the phone, mail, or internet/email unless you initiated the contact and are certain you are dealing with a trusted organization or individual.
- Verify requests for personal information from any business or financial institution by contacting them using the main contact information on their official website.
- Do not open, respond to, or click on links contained within unsolicited emails.
- Use strong and different passwords to secure banking accounts, credit accounts, etc., and change passwords and check accounts routinely.
- Limit personal information shared publicly on social networking sites. Never post your full name, Social Security number, address, phone number, or account numbers in publicly accessible sites.
- Regularly obtain and check your credit reports from the three credit bureaus to ensure you recognize all accounts.
- Tell someone you trust if you have become a victim.
- If you suspect fraud or have fallen victim to an online scam report the fraud to the authorities and the dating website.
- Keep in mind that if you send money once, you’ll be a target for life.
- Remember, it’s not rude to say, “NO,” if someone approaches you online.
- A good rule of thumb is, if it’s too good to be true, it’s likely a scam.
To report suspicious activity or if you’ve fallen victim to a scam, please call the Department of Justice’s National Elder Fraud Hotline at 1-833-FRAUD-11 (1-833-372-8311), or online at www.IC3.gov.
For more information about the U.S. Attorney’s Office Elder Justice Initiative, please visit: https://www.justice.gov/usao-wdnc/elder-justice-initiative.
A recording of the seminar can be viewed at https://www.facebook.com/AARPNC/videos/vb.86880509778/291438361931498/?type=2&theater.
Federal Jury Convicts Boone, N.C. Man of Child PornographyRead the Press Release
CHARLOTTE, N.C. – A federal jury in Charlotte has convicted William Jon Patric Ebert, 60, of Boone, N.C. of child pornography charges, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. U.S. District Judge Frank D. Whitney presided over the trial. The jury returned the guilty verdict on Friday, July 17, 2020, following a two-day trial.
According to filed court documents and evidence presented at trial, Ebert sexually abused a minor for more than six years. The sexual abuse took place in Ohio and in North Carolina. Evidence presented at trial established that Ebert also used the minor to produce child pornography photographs of the minor, and that he stored those photographs on his computer and other devices he owned. On September 22, 2016, law enforcement officials executed a search warrant at Ebert’s residence in Boone and seized several devices and computers. A forensic analysis of Ebert’s hard drive revealed that it contained sexually explicit images of the minor victim.
The jury convicted Ebert of using a minor to produce child pornography photographs of the minor. The jury also convicted Ebert of possessing those photographs. He was found not guilty of transporting a minor with intent to engage in sexual criminal activity. Ebert is currently in federal custody. A sentencing date has not been set.
The production of child pornography charge carries a mandatory minimum sentence of 15 years and a maximum sentence of 30 years in prison. The possession of child pornography charge carries a maximum sentence of 10 years in prison. Both charges carry a maximum fine of $250,000.
In making today’s announcement U.S. Attorney Murray thanked the North Carolina State Bureau of Investigation and the Avon Police Department in Ohio for their investigation of this case.
Assistant United States Attorneys Kimlani Ford and Eric Lindahl are prosecuting the case for the United States.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (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.
Franklin, N.C. Man Is Sentenced to More Than 12 Years for Armed Bank Robbery in AshevilleRead the Press Release
ASHEVILLE, N.C. – Chief U.S. District Judge Martin Reidinger sentenced William Keith Leonhart, 41, of Franklin, N.C., to 154 months in prison followed by five years of supervised release for robbing at gunpoint an Asheville bank, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.
According to filed court documents and yesterday’s sentencing hearing, on August 5, 2019, the Asheville Police Department received a call regarding an armed robbery of the First Citizens Bank located at 1201 Tunnel Road in Asheville. Court records show that Leonhart had entered the bank, approached a teller and brandished a firearm. While pointing his firearm at the teller, Leonhart gave the teller a threatening demand note. The teller handed Leonhart approximately $500 out of her cash drawer and Leonhart fled the scene in a stolen vehicle. The next day, law enforcement identified Leonhart driving a second stolen vehicle in Black Mountain, N.C. Following a vehicle chase, Leonhart was arrested, and law enforcement recovered from inside the vehicle the firearm Leonhart had used during the robbery. According to court records, Leonhart had previously robbed the same bank in 2013, and had received a sentence of 66-89 months in prison.
In October 2019, Leonhart pleaded guilty to one count of bank robbery and one count of possession of a firearm in furtherance of a crime of violence. He is currently in federal custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.
In making today’s announcement U.S. Attorney Murray thanked the Asheville Police Department, the Black Mountain Police Department, and the Federal Bureau of Investigation for their investigation of this case. He also thanked District Attorney Todd Williams for his office’s coordination over the course of the prosecution of this case.
Special Assistant United States Attorney (SAUSA) Alexis Solheim prosecuted the case. Ms. Solheim is a state prosecutor with the office of the 30th Prosecutorial District, and was assigned by District Attorney Ashley Welch to serve as SAUSA with the U.S. Attorney’s Office in Asheville. Ms. Solheim is duly sworn in both state and federal courts. The SAUSA position is a reflection of the partnership between the office of the 30th Prosecutorial District and the United States Attorney’s Office. The SAUSA position helps ensure the effective and vigorous prosecution of federal court cases that impact the counties within the 30th Prosecutorial District.
Brevard, N.C. Woman Is Sentenced to Prison for Selling Fake Title Insurance PoliciesRead the Press Release
ASHEVILLE, N.C. – U. S. District Judge Martin Reidinger sentenced Ginger Lynn Cunningham, 39, formerly of Hendersonville and currently residing in Brevard, to 14 months in prison yesterday, for selling fake title insurance policies, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. In addition to the prison term imposed, Cunningham was ordered to serve three years under court supervision and to pay $412,344 as restitution.
According to information contained in filed court documents and presented in court during Cunningham’s sentencing hearing, Cunningham owned and operated Blue Ridge Title Company, an independent title insurance agency located in Buncombe County. Beginning in February 2015, Cunningham became an authorized independent agent for Commonwealth Land Title Insurance Company (Commonwealth). As an authorized agent, Cunningham’s title agency sold title insurance policies underwritten by Commonwealth and collected premium payments during real estate closings. Under the agreement with Commonwealth, Cunningham’s Blue Ridge Title Company would keep 80% of the premium payments, and the remaining 20% would be sent to Commonwealth. On or about March 21, 2016, Commonwealth terminated their agreement with Blue Ridge Title Company, because Cunningham failed to submit premium payments as required to Commonwealth. At the time of termination, Blue Ridge Title Company owed Commonwealth in excess of $25,000 in premium payments.
According to court documents, from March 2016 until October 2017, Cunningham continued to represent herself and Blue Ridge Title Company to be an independent agent of Commonwealth, despite knowing that she no longer had any relationship with Commonwealth, and continued to sell fictitious title insurance policies and collect premium payments. The buyers of these bogus title insurance policies did not know that they were not underwritten by any insurance provider, and thus had no value. Court records show that Cunningham further deceived her customers by drafting official looking, but fictitious, policy documents that bore the name of Commonwealth Land Title Insurance Company and fabricated policy numbers. Cunningham kept 100% of the premium payments associated with these worthless policy sales. As court records show, during the relevant time period, Cunningham sold at least 973 counterfeit title insurance policies and received at least $412,344 in premiums for the bogus policies. On October 28, 2019, Cunningham pleaded guilty wire fraud.
In making today’s announcement U.S. Attorney Murray commended the U.S. Department of Housing and Urban Development, Office of Inspector General, the Federal Housing Finance Agency, Office of Inspector General, and the North Carolina Department of Insurance for their investigation of this case.
Assistant United States Attorney Don Gast, of the U.S. Attorney’s Office in Asheville, prosecuted the case for the United States.
Federal Judge Sentences Boone, N.C. Man to 20 Years for Transporting and Possessing Child PornographyRead the Press Release
CHARLOTTE, N.C. – Today, U. S. District Judge Kenneth D. Bell sentenced Thomas Arthur Rittenhouse, 76, of Boone, N.C. to 20 years in prison on child pornography charges, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. In addition to the prison term imposed, Rittenhouse was ordered to a lifetime of supervised release and to register as a sex offender.
According to filed court documents, evidence presented at Rittenhouse’s trial, and today’s sentencing hearing, between 2014 and 2017, Rittenhouse used peer-to-peer computer networks to obtain dozens of videos depicting children being sexually abused. Rittenhouse also made the child abuse videos available for download by other users of the peer-to-peer network. Evidence presented at trial established that Rittenhouse specifically used search terms associated with child abuse material to seek out such videos and images, and then shared those images with others. A forensic analysis of the devices that belonged to Rittenhouse revealed that he possessed more than 60 videos and 74 images depicting the sexual abuse of children, including adult men sexually abusing prepubescent children. According to court records, the defendant also told law enforcement that he had downloaded and deleted more than 1,000 child pornography files in the previous fifteen years.
In December 2019, a federal jury convicted Rittenhouse of two counts of transportation of child pornography, and one count of possession of child pornography. He is currently in federal custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.
In making today’s announcement U.S. Attorney Murray commended the Boone Police Department and the North Carolina State Bureau of Investigation for their investigation of this case, and thanked Homeland Security Investigations and the Federal Bureau of Investigation for their assistance.
Assistant United States Attorney Alfredo DeLaRosa prosecuted the case for the United States.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (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.
Federal Judge Sentences Serial Bank Robber to over 10 YearsRead the Press Release
ASHEVILLE, N.C. – U.S. District Judge Max O. Cogburn, Jr. sentenced John Howard Johnson, 65, to 130 months in prison followed by three years of supervised release, in connection with a series of armed bank robberies he committed in 2019, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. In addition to the prison term, Judge Cogburn also ordered Johnson to pay $8,569 as restitution.
According to filed court documents and today’s sentencing hearing, between July 3, 2019, and August 23, 2019, Johnson robbed four banks in North and South Carolina. Court records show that on July 3, 2019, Johnson entered a BB&T bank located at 174 Meeting Street, in Charleston, S.C., and passed a demand note written on an envelope to a teller that read, “I have a gun. Give me $100s and $50s.” According to court records, Johnson lifted his shirt and exposed what appeared to be a firearm and threatened to shoot the teller. The teller placed $1,800 into an envelope and gave it to Johnson, who then fled the scene in a vehicle.
According to court records, the second bank robbery occurred on July 23, 2019. On that date, Johnson entered the First Bank located at 201 Market Street, in Wilmington, N.C., and, similar to the first robbery, Johnson passed a demand note to the teller, threatening to kill the teller and asking for cash. After the teller handed Johnson the money, Johnson again fled in his vehicle. The next bank robbery occurred on July 31, 2019, at the BB&T bank located at 150 S. Main Street, in Mount Holly, N.C. As with the prior robberies, Johnson entered the bank, passed a demand note written on an envelope to a teller that read, “I have a gun in my shorts. Give me all of your 50s and 100s. Don’t make me kill you. Don’t make me shoot you.” After the teller put the cash into an envelope and gave it to Johnson, the defendant fled in the same vehicle.
According to court records, on August 23, 2019, Johnson entered the TD Bank located at 535 Greenville Highway, in Hendersonville, N.C., and again passed a demand note to the teller that read, “This is not a joke, I have a gun, I will kill you.” Johnson took the money the teller handed him and left the bank in his vehicle.
Law enforcement arrested Johnson in Charleston in September 2019. On February 3, 2020, he pleaded guilty to bank robbery charges. Johnson is in federal custody and will be transferred into custody of the Federal Bureau of Prisons upon designation of a federal facility.
In making today’s announcement, U.S. Attorney thanked the FBI, the Mt. Holly Police Department, the Hendersonville Police Department, the Wilmington Police Department, the Charleston Police Department and the Sever County Police Department for investigation of this case.
Assistant U.S. Attorney Don Gast, of the U.S. Attorney’s Office in Asheville, prosecuted the case.
IRS Criminal Investigation and United States Attorney's Office Remind Taxpayers of Upcoming Tax Filing Deadline and Urge Taxpayers to Remain Vigilant of ScamsRead the Press Release
The Internal Revenue Service Criminal Investigation division and the U.S. Attorney’s Office for the Western District of North Carolina reminded taxpayers of the July 15 filing and payment deadline and warned against an increase in tax and COVID-19 scams.
Due to COVID-19, the original filing deadline and tax payment due date for 2019 was postponed from April 15 to July 15. Taxpayers filing Form 1040 series returns must file Form 4868 by July 15 to obtain the automatic extension to Oct. 15.
"Although the extension provides additional time to file the tax return – it is not an extension to pay any taxes due", said Matthew D. Line, Special Agent in Charge of the IRS Criminal Investigation division in North Carolina, South Carolina and Tennessee. "For people facing hardships who cannot pay in full, including those affected by COVID-19, the IRS has several options available to help. The IRS encourages taxpayers to visit IRS.gov as soon as possible to explore these options and avoid accruing interest and penalties after the July 15 deadline."
As the filing deadline approaches, taxpayers should beware of tax and COVID-19 related scams. "Criminals use the tax filing deadline as an opportunity to steal personal and financial information", said R. Andrew Murray, U.S. Attorney for the Western District of North Carolina. "Taxpayers should remain vigilant and know that the IRS will not initiate contact with them via phone, email or social media to request personal or financial information."
In the last few months, the IRS Criminal Investigation division (CI) has continued to see a tremendous increase in a variety of Economic Impact Payment scams and other financial schemes. CI continues to work with its law enforcement partners to put a stop to these schemes and bring criminals to justice.
Taxpayers can report COVID-19 scams to the National Center for Disaster Fraud. Taxpayers can also report fraud or theft of their Economic Impact Payments to the
Treasury Inspector General for Tax Administration (TIGTA). Unsolicited (phishing) e-mails that appear to be from the IRS should be forwarded to [email protected].
For the most up-to-date information about the tax filing deadline and IRS impersonation scams, taxpayers can visit IRS.gov.
Asheville Man Is Sentenced to 17.5 Years for Orchestrating $22 Million Ponzi SchemeRead the Press Release
CHARLOTTE, N.C. – Hal H. Brown Jr., 70, of Asheville, N.C., was sentenced to 210 months in prison and three years of supervised release for orchestrating a $22 million Ponzi scheme, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. U.S. District Judge Kenneth D. Bell also ordered Brown to pay more than $17 million as restitution.
John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, joins U.S. Attorney Murray in making today’s announcement.
According to filed court documents and yesterday’s sentencing hearing, from at least 2007 through September 2019, Brown fraudulently obtained more than $22.5 million from at least 60 victims, some of whom were at, or near, retirement age, by engaging in a sophisticated Ponzi scheme through his company Oodles Inc. and its various affiliates (collectively “OODLES”). Court records show that Brown was the architect and primary, if not sole, operator of the fraud, and he used his religious reputation and his respected status in the local community to con his investor-victims into trusting him with their money.
According to court documents, Brown defrauded family, friends, neighbors, and fellow church members, who invested anywhere from a few thousand to a few million dollars in OODLES. To induce victims to invest their money, Brown falsely represented that OODLES owned hundreds of millions of dollars in intellectual property, namely family entertainment shows and movies with a religious theme. As part of the scheme, Brown repeatedly lied to victims about the imminent sale of those intellectual properties to various well-known media companies. To perpetuate the fraud, Brown developed marketing material seeking investments or loans for OODLES that claimed large returns on funds invested or lent to the company.
As Brown previously admitted in court, to convince victims the scheme was legitimate and to appease investors who sought an explanation about delays in payouts, Brown provided victims with a number of fraudulent and misleading statements and fictitious information, including fake bank statements and falsified company agreements, among others. He also impersonated employees of well-known media companies and at least one law-firm to add the appearance of legitimacy to his scheme.
According to court documents and today’s sentencing hearing, Brown led an affluent lifestyle, and used a substantial part of victim money on personal expenses unrelated to purported OODLES transactions. He also used funds contributed by new investors to make payments to existing investors, commonly referred to as “Ponzi” payments.
At the sentencing hearing, the Court heard evidence, including statements from some of Brown’s victims, about the tremendous damage wrought by Brown’s fraudulent scheme. This included causing some of his victims serious substantial economic and psychological damage, robbing some of his victims’ nest eggs set aside for education and retirement, and forcing some of his victims out of retirement and back into the workforce.
On January 21, 2020, Brown pleaded guilty to securities fraud and transactional money laundering. In handing down Brown’s enhanced sentence today, the Court considered Brown’s lack of remorse and accountability and the need to protect the public from further crimes by Brown, after evidence presented at the sentencing hearing revealed that, up until very recently, Brown continued to proclaim his innocence in a video he had sent to numerous individuals with whom he had worked decades ago in a volunteer organization to solicit letters of support for his good character. Based on the false information Brown presented in his video, some of the email recipients did write letters of support for Brown, which were filed with the Court. The Court also received evidence of a recent email sent on Brown’s behalf repeating Brown’s lies about his innocence and soliciting loans to help Brown pay expenses, which Brown would purportedly repay with interest in the near future.
In imposing the lengthy sentence, Judge Bell noted that while most Ponzi schemes are horrendous, Brown’s conduct represented some of the worst fraud committed in the worst way and harming some of the most vulnerable victims. Brown was remanded into custody at the conclusion of the sentencing hearing to begin serving his sentence immediately.
In making today’s announcement U.S. Attorney Murray thanked the FBI’s Hickory Residence Agency office, which handled the investigation.
Assistant U.S. Attorneys Daniel Ryan and Mark Odulio of the U.S. Attorney’s Office in Charlotte are prosecuting the case.
In March 2019, Andrew Murray, U.S. Attorney for the Western District of North Carolina, announced the Office’s Elder Justice Initiative, which aims to combat elder financial exploitation by expanding efforts to investigate and prosecute financial scams that target seniors; educate older adults on how to identify scams and avoid becoming victims of financial fraud; and promote greater coordination with law enforcement partners. For more information please visit: /usao-wdnc/elder-justice-initiative.
Federal Authorities Seize over $80,000 in Funds Tied to COVID-19 Unemployment Fraud SchemeRead the Press Release
CHARLOTTE, N.C. – Federal authorities have seized $80,661.05 in funds held at bank accounts allegedly used to perpetuate COVID-19 unemployment fraud, announced U.S. Attorney Andrew Murray. The federal seizure warrant was executed by U.S.
Picture of COVID-19 Fraud Hotline 866-720-5721 or justice.gov/DisasterComplaintFormSecret Service agents and was unsealed in federal court today. Earlier this week, the U.S. Attorney’s Office announced the seizure of $48,742.50, also allegedly tied to a COVID-19 unemployment fraud scheme.
Reginald A. DeMatteis, Special Agent in Charge of the United States Secret Service, Charlotte Field Office, joins U.S. Attorney Murray in making today’s announcement.
The affidavit filed in support of the federal warrant alleges that the funds were seized as part of an ongoing investigation of a COVID-19 unemployment fraud scheme that implicates bank accounts purportedly opened by individuals in the Western District of North Carolina. As alleged in court documents, the bank accounts identified in the seizure warrant were allegedly used to transfer to scammers funds fraudulently obtained from federal and state unemployment benefit programs put in place to provide financial assistance to qualifying individuals impacted by the coronavirus outbreak. The warrant alleges that scammers have targeted these programs and have exploited them for their benefit.
Court documents allege that the scammers carried out the fraud by using identity theft victims’ Personally Identifiable Information (PII) to apply for unemployment benefits online. Then, at the direction of the fraudsters, bank account holders were directed to receive the fraud proceeds and to conduct financial transactions with those proceeds, or to transfer the money to other bank accounts, often located overseas. In many instances, the bank account holders that received or made transactions with the stolen funds were not aware they were being exploited to carry out financial fraud. Rather, as the filed affidavit alleges, in many instances, the individuals who opened the bank accounts used to perpetuate the fraud were led to believe they were involved in online romantic relationships with the fraudsters.
In making today’s announcement, U.S. Attorney Murray commended the U.S. Secret Service for their investigative work in this case and for their ongoing efforts to combat fraud related to COVID-19. He also thanked financial institutions in Western North Carolina for their cooperation and their efforts to detect and report COVID-19 financial fraud.
Assistant U.S. Attorney Benjamin Bain-Creed, of the U.S. Attorney’s Office in Charlotte, is handling the federal warrants.
U.S. Attorney Murray also urged the public to remain alert in detecting COVID-19 fraud and to report suspicious activity to the local authorities, or by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form. Members of the public in the Western District of North Carolina are also encouraged to call 704-344-6222 to reach their local Coronavirus Fraud Coordinator at the U.S. Attorney’s Office.
Fourteen Members of Methamphetamine Trafficking Ring Are Charged with Drug Conspiracy and Related ChargesRead the Press Release
CHARLOTTE, N.C. – Fourteen members of a methamphetamine trafficking ring have been charged with federal drug conspiracy and related drug and firearms offenses, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. The federal indictment was unsealed in court today.
Seven of those charged have been arrested by federal, state and local law enforcement, and the remaining seven defendants are currently incarcerated on unrelated charges. The arrests are the result of a multi-agency investigation targeting the trafficking of methamphetamine from Georgia into Western North Carolina.
“With methamphetamine trafficking on the rise, it is crucial that we continue to team up with our law enforcement counterparts to stem the flow of this dangerous drug, disrupt drug pipelines, and prosecute traffickers who plague our neighborhoods and imperil our communities,” said U.S. Attorney Murray.
“Methamphetamine poses a clear and present danger to the health and safety of communities,” said Robert J. Murphy, the Special Agent in Charge of the DEA Atlanta Field Division. “Because of the unified effort of all law enforcement agencies involved and the subsequent prosecution by the U.S. Attorney’s Office, we have dismantled this alleged drug conspiracy, and these defendants will no longer be able to distribute this toxic drug that destroys lives and communities.”
“The trafficking of methamphetamine into our country and its spread through our communities is a national crisis. Together, through our partnerships with the DEA and the United States Attorney’s Office, we are fighting this battle as a united front,” said Sheriff Donald G. Brown II, of the Catawba County Sheriff’s Office.
According to allegations contained in the criminal indictment unsealed today in federal court, from 2018 through April 2019, the 14 defendants were involved in a drug conspiracy that trafficked and distributed methamphetamine in Catawba, Lincoln, Caldwell, and Alexander Counties and elsewhere in Western North Carolina. Over the course of the investigation, law enforcement seized at least 23 firearms, and more than $250,000 in drug proceeds. The 14 defendants charged are:
- Thomas Dewayne Simmons, Jr., 34, of Snellville, Georgia.
- Ruth Marie Duggar, 36, of Claremont, N.C.
- Kimberly Deann Bumgarner, 55, of Claremont, N.C.
- Cynthia Roxanne Shook, 34, of Catawba, N.C.
- Lowell Thomas Messer, 32, of Sherrills Ford, N.C.
- Samantha Jean Taylor, 26, of Newton, N.C.
- Jason Keith Reichard, 38, of Newton, N.C.
- Aaron Douglas Goodson, 29, of Maiden, N.C. (in custody on state charges)
- Priscilla Chapman Lambert, 33, of Hickory, N.C. (in custody on state charges)
- Jonathan Corey Daniel, 31, currently incarcerated in the Georgia Department of Corrections.
- Tiffany Christmas Hirani, 33, currently incarcerated at the Clayton County Sheriff’s Office Detention Center in Jonesboro, Georgia.
- James Kristoffer Cantley, 38, currently incarcerated at the Robert A. Detention Center in Lovejoy, Georgia.
- Brian Duane Martz, 40, currently incarcerated in the Georgia Department of Corrections.
- Michael James Notheisen, 34, currently incarcerated in the North Carolina Department of Corrections.
All 14 defendants are charged with conspiracy to traffic methamphetamine, which carries a statutory minimum prison term of ten years and a maximum term of life in prison, and a $10 million fine. Some defendants face additional drug possession and distribution charges and/or related firearms offenses. (See chart below for a breakdown of federal charges and maximum penalties for each defendant).
The charges contained in the indictment are allegations. The defendants are presumed innocent unless and until proven guilty beyond reasonable doubt in a court of law.
In making today’s announcement U.S. Attorney Murray thanked the following agencies for their investigative efforts which led to federal charges: the DEA in Charlotte, Asheville, and Atlanta; the North Carolina State Bureau of Investigation; the North Carolina State Highway Patrol; the Catawba County Sheriff’s Office; the Newton Police Department; the Conover Police Department; the Maiden Police Department; the Hickory Police Department; the Longview Police Department; the Caldwell County Sheriff’s Office; the Granite Falls Police Department; the Lincoln County Sheriff’s Office; the Cleveland County Sheriff’s Office; the Huntersville Police Department; the Cornelius Police Department; the Mint Hill Police Department; the Pineville Police Department; the Charlotte Mecklenburg Police Department; the Monroe Police Department; the Taylorsville Police Department; the Gaston County Police Department; the Georgia Highway Patrol; the Franklin County Sheriff’s Office in Georgia; the Georgia Bureau of Investigation; the Georgia Department of Corrections; the Clayton County Sheriff’s Office in Georgia; and the Commerce Police Department in Georgia.
Assistant U.S. Attorney Christopher Hess, of the U.S. Attorney’s Office in Charlotte, is prosecuting the case.
DEFENDANT
COUNTS
CHARGE
STATUTORY PENALTIES
Jonathan Corey Daniel
a/k/a “Ambush”
a/k/a “Ambush Newage”
a/k/a “Orion Bls Newage”
1
Methamphetamine Conspiracy
10 years to life in prison, maximum fine of $10,000,000
23, 25
Distribution and Possess with Intent to Distribute Methamphetamine
10 years to life in prison, maximum fine of $10,000,000
Tiffany Christmas Hirani
a/k/a “Tiffany Christmas”
1
Methamphetamine Conspiracy
10 years to life in prison, maximum fine of $10,000,000
11
Distribution and Possess with Intent to Distribute Methamphetamine
10 years to life in prison, maximum fine of $10,000,000
James Kristoffer Cantley
1
Methamphetamine Conspiracy
10 years to life in prison, maximum fine of $10,000,000
2, 8, 14
Possess a Firearm in Furtherance of a Drug Trafficking Crime
5 years to life in prison, consecutive to a sentence imposed on a drug count, maximum fine of $250,000
3, 9, 15
Possess Firearms by Felon
0 to 10 years in prison, maximum fine of $250,000
6, 10
Possess with Intent to Distribute Methamphetamine
10 years to life in prison, maximum fine of $10,000,000
7
Possess with Intent to Distribute Heroin
0 to 20 years in prison, maximum fine of $1,000,000
13
Possess with Intent to Distribute Methamphetamine
5 to 40 years in prison, maximum fine of $5,000,000
Aaron Douglas Goodson
1
Methamphetamine Conspiracy
10 years to life in prison, maximum fine of $10,000,000
10, 11, 18
Possess with Intent to Distribute Methamphetamine
10 years to life in prison, maximum fine of $10,000,000
12, 19
Possess Firearms in Furtherance of a Drug Trafficking Crime
5 years to life in prison, consecutive to a sentence imposed on a drug count, maximum fine of $250,000
Cynthia Roxanne Shook
a/k/a “Roxi Johnson”
a/k/a “Roxi Shook
1
Methamphetamine Conspiracy
10 years to life in prison, maximum fine of $10,000,000
4
Distribution and Possess with Intent to Distribute Methamphetamine
0 to 20 years in prison, maximum fine of $1,000,000
5
Possession with Intent to Distribute Methamphetamine
10 years to life in prison, maximum fine of $10,000,000
Brian Duane Martz
a/k/a “B”
1
Methamphetamine Conspiracy
10 years to life in prison, maximum fine of $10,000,000
Priscilla Chapman Lambert
a/k/a “Priscilla Sweetp Chapman”
a/k/a “Sweet Pea”
a/k/a “Sweet P”
1
Methamphetamine Conspiracy
10 years to life in prison, maximum fine of $10,000,000
Thomas Dewayne Simmons, Jr
a/k/a “Tommy”
a/k/a “Tommy Simons”
1
Methamphetamine Conspiracy
10 years to life in prison, maximum fine of $10,000,000
23, 25
Distribution and Possess with Intent to Distribute Methamphetamine
10 years to life in prison, maximum fine of $10,000,000
Ruth Marie Duggar
a/k/a “White Girl”
1
Methamphetamine Conspiracy
10 years to life in prison, maximum fine of $10,000,000
24, 26
Possess with Intent to Distribute Methamphetamine
10 years to life in prison, maximum fine of $10,000,000
Kimberly Deann Bumgarner
a/k/a “Momma”
a/k/a “Momma Kim”
1
Methamphetamine Conspiracy
10 years to life in prison, maximum fine of $10,000,000
24, 26
Possess with Intent to Distribute Methamphetamine
10 years to life in prison, maximum fine of $10,000,000
Michael James Notheisen
a/k/a “Mike Bebollin”
a/k/a “BE BAllin”
a/k/a “B Ballin”
1
Methamphetamine Conspiracy
10 years to life in prison, maximum fine of $10,000,000
20, 28
Possess with Intent to Distribute Controlled Substances
5 to 40 years in prison, maximum fine of $5,000,000
21, 31
Possess with Intent to Distribute Heroin
0 to 20 years in prison, maximum fine of $1,000,000
22, 29, 32
Possess Firearms in Furtherance of a Drug Trafficking Crime
5 years to life in prison, consecutive to a sentence imposed on a drug count, maximum fine of $250,000
27
Possess with Intent to Distribute Methamphetamine
10 years to life in prison, maximum fine of $10,000,000
33
Possess Firearms by Felon
0 to 10 years in prison, maximum fine of $250,000
Lowell Thomas Messer, Jr.
1
Methamphetamine Conspiracy
10 years to life in prison, maximum fine of $10,000,000
16
Possess with Intent to Distribute Methamphetamine
5 to 40 years in prison, maximum fine of $5,000,000
17, 34
Possess with Intent to Distribute Methamphetamine
10 years to life in prison, maximum fine of $10,000,000
Samantha Jean Taylor
1
Methamphetamine Conspiracy
10 years to life in prison, maximum fine of $10,000,000
Jason Keith Reichard
1
Methamphetamine Conspiracy
10 years to life in prison, maximum fine of $10,000,000
30
Possess with Intent to Distribute Methamphetamine
5 to 40 years in prison, maximum fine of $5,000,000
Federal Seizure Warrants Freeze Funds Tied to COVID-19 Unemployment Fraud SchemeRead the Press Release
CHARLOTTE, N.C. – The U.S. Attorney’s Office has taken swift action to seize $48,742.50 in funds held at bank accounts allegedly used to perpetuate COVID-19 unemployment fraud, announced U.S. Attorney Andrew Murray. The federal asset forfeiture seizure warrants executed by the United States Secret Service were unsealed by the Court today.
Reginald A. DeMatteis, Special Agent in Charge of the United States Secret Service, Charlotte Field Office, joins U.S. Attorney Murray in making today’s announcement.
In a memorandum issued on March 16, 2020, Attorney General William P. Bar directed U.S. Attorney’s Offices across the country to remain vigilant in detecting, investigating, and prosecuting wrongdoing related to COVID-19, and to prioritize the investigation and prosecution of criminal conduct exploiting the coronavirus epidemic.
In making today’s announcement, U.S. Attorney Murray said, “We will not allow scammers to profit from the COVID-19 crisis. Federal prosecutors in this Office have been working closely with federal, state and local authorities to ensure that we swiftly investigate possible misconduct related to the coronavirus, and use all enforcement tools available to end the fraud and punish the perpetrators.”
“Today’s announcement illustrates the Secret Service’s commitment to combating COVID-19 unemployment fraud,” said Special Agent in Charge DeMatteis. “The actions taken by the Secret Service and the U.S. Attorney’s Office prevented legitimate unemployment funds from getting into the wrong hands. The Secret Service will continue to work closely with the U.S. Attorney’s Office to investigate and prosecute criminals who attempt to defraud the critical COVID-19 relief programs and the American taxpayer.”
As alleged in the affidavit filed in support of the federal warrants, the seizures stem from an ongoing investigation of a COVID-19 unemployment fraud scheme that implicates bank accounts in the Western District of North Carolina. These bank accounts were allegedly used to transfer money from unemployment benefit programs to fraudsters. Both the federal government and state governments have recently implemented unemployment benefit programs to disburse money to certain qualifying individuals who have become unemployed as a result of the recent coronavirus outbreak. These programs provide means for impacted individuals to apply online for unemployment benefits and to receive much-needed funds. In some instances, fraudsters have targeted these benefit programs and have exploited them for their benefit.
According to allegations in the affidavit, to carry out the scheme, the fraudsters used victims’ stolen identities to apply for unemployment benefits online. The scammers then used the bank accounts of yet another set of unsuspecting individuals as “money mule” accounts, to receive and transfer the stolen benefits. “Money mule accounts” are bank accounts used by fraudsters as a pass through means of moving fraudulently-obtained funds. Oftentimes, the unwitting money mule victims, typically acting at the direction of the fraudsters, receive fraud proceeds and conduct financial transactions with those proceeds, or transfer the money from the money mule account to other bank accounts, often located overseas. In many instances, the account holders are not aware they are being exploited to carry out financial fraud.
As alleged in the federal affidavit, in some instances in this case, the individuals who opened the money mule accounts believed themselves to be engaged in online romantic relationships with the fraudsters. The funds identified for seizure in this case were deposited as a result of fraud on coronavirus-related unemployment benefit programs, into many such money mule accounts, including accounts purportedly opened by individuals in the Western District of North Carolina.
Commending the investigative work of the United States Secret Service, U.S. Attorney Murray said, “I thank the U.S. Secret Service for acting quickly to stop this fraud. My office will continue to with work federal, state, and local law enforcement and stakeholder banks, to make sure domestic or foreign criminals do not profit from pillaging important COVID-19 relief programs.”
U.S. Attorney Murray also noted that the public plays an important role in stopping COVID-19 fraud and urged everyone to remain alert about possible coronavirus scams. “If you are engaged in an online-only relationship and your paramour asks you to open a new bank account, or use your existing account to transfer funds, think twice. A fraudster posing as a romantic online partner could be using you and your accounts as a repository to launder stolen money. Don’t let a scammer turn you into a money mule. Be extra vigilant about online scams, and if the circumstances are suspicious get in touch with law enforcement right away.”
The U.S. Secret Service is in charge of the investigation, which is ongoing. Assistant U.S. Attorney Benjamin Bain-Creed, of the U.S. Attorney’s Office in Charlotte, is handling the federal civil court proceedings.
The Department of Justice remains vigilant in detecting, investigating, and prosecuting wrongdoing related to the COVID-19 pandemic. Under the leadership of Attorney General Barr, U.S. Attorneys appointed Coronavirus Fraud Coordinators to work with federal, state, local and tribal law enforcement partners to protect the public from scammers who are attempting to prey upon fears. If you think you are a victim of a scam or attempted fraud involving COVID-19, you can report the fraud by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form. Members of the public in the Western District of North Carolina are also encouraged to call 704-344-6222 to reach their local Coronavirus Fraud Coordinator.
Yacht Owner Is Sentenced to 35 Years for Secretly Recording Nude Videos of MinorsRead the Press Release
ASHEVILLE, N.C. – U.S. Attorney Andrew Murray announced today that William Richard Hilliard, Jr., 51, a former resident of Cleveland County and Cherryville, N.C., currently residing in Gastonia, was sentenced to 35 years in prison for secretly recording nude videos of underage females aboard his yacht. In addition to the prison term imposed, Chief U.S. District Judge Martin Reidinger also ordered Hilliard to serve a lifetime of supervised release and to register as a sex offender upon his release from prison. Hilliard was also ordered to pay $88,476 as restitution to five victims and a $5,000 special assessment fee.
According to information contained in filed court documents and statements made in court, Hilliard was arrested on June 11, 2018, by Myrtle Beach, South Carolina law enforcement officers on charges of video voyeurism. Hilliard was the owner of a yacht called “Yachts O’ Trouble,” and he had been discovered secretly recording nude videos of unsuspecting females aboard his yacht, including minor and adult guests. Court records show that as a result of the events surrounding his arrest, the FBI coordinated an extensive multi-state and multi-agency investigation.
As Hilliard admitted in court documents, law enforcement discovered that, over the course of eight to ten years, Hilliard had secretly produced multiple secret recordings of at least 16 child victims at various locations in North Carolina, South Carolina, and Alabama, including aboard his yacht, in his homes, in various hotel rooms, and elsewhere. Court records also show that, at times, Hilliard produced secret recordings of victims he had hired as babysitters for his young children, and used multiple hidden devices to record his victims from different angles while they were using the shower and changing clothes. Some of the victims were as young as five years old. According to court records, also Hilliard engaged in sexual acts with one of the minor victims, which he secretly recorded.
On April 22, 2019, Hilliard pleaded guilty to sexual exploitation of a minor and possession of child pornography. He is currently in custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.
In making today’s announcement, U.S. Attorney Murray thanked the FBI’s Charlotte Division, the Myrtle Beach Police Department, the Horry County Police Department, and the Cleveland County Sheriff’s Office for their investigation of this case with assistance from FBI Knoxville, FBI Birmingham, Homeland Security Investigations, the Cherryville Police Department and the Gastonia Police Department. The U.S. Attorney’s Office in Asheville prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in 2006 by the Department of Justice, aimed at combating the growing online sexual exploitation of children. By combining resources, federal, state and local agencies are better able to locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue those victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Cherokee, N.C. Man Is Sentenced to More Than Seven Years for Possession of A Firearm While on Federal ProbationRead the Press Release
ASHEVILLE, N.C. – Chief U.S. District Judge Martin Reidinger today sentenced Tanner Moren Eagle Larch, 30, of Cherokee, N.C., to 92 months in prison and three years of supervised release for a firearms offense, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.
Vincent C. Pallozzi, Special Agent in Charge of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) in North Carolina, and Sheriff Chip Hall of the Jackson County Sheriff’s Office join U.S. Attorney Murray in making today’s announcement.
On April 4, 2013, Larch was sentenced to six and a half years in prison and three years of supervised release for a federal robbery conviction. According to filed court documents and today’s sentencing hearing, on September 14, 2018, while Larch was still on federal probation, the Jackson County Sheriff’s Office was informed that an arrest warrant for Larch had been issued for a violation of the terms of his supervised release. Court records show that Larch had been seen on the campus of Smoky Mountain High School leaving the football stadium on the same day. Law enforcement located and attempted to arrest Larch, who dropped a firearm he possessed and fled on foot. After he fled the scene, Larch, holding a second firearm behind his back, approached five young males standing outside of a car in the parking lot behind the high school’s gymnasium. Following a brief tussle, one of the young men wrestled the firearm out of Larch’s hands, and Larch fled the scene again. Shortly thereafter, Larch was apprehended by law enforcement.
On January 7, 2020, a federal jury convicted Larch of two counts of possession of a firearm by a felon. Larch is currently in federal custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.
In making today’s announcement, U.S. Attorney Murray commended the ATF and the Jackson County Sheriff’s Office for their investigation of this case. He also thanked District Attorney Ashley Welch for her office’s coordination over the course of the prosecution of this case.
Special Assistant United States Attorney (SAUSA) Alexis Solheim prosecuted the case. Ms. Solheim is a state prosecutor with the office of the 30th Prosecutorial District, and was assigned by District Attorney Ashley Welch to serve as SAUSA with the U.S. Attorney’s Office in Asheville. Ms. Solheim is duly sworn in both state and federal courts. The SAUSA position is a reflection of the partnership between the office of the 30th Prosecutorial District and the United States Attorney’s Office. The SAUSA position helps ensure the effective and vigorous prosecution of federal court cases that impact the counties within the 30th Prosecutorial District.
Federal Jury Convicts Honduran National of KidnappingRead the Press Release
CHARLOTTE, N.C. – U.S. Attorney Andrew Murray announced today that a federal jury sitting in Charlotte has convicted Luis Analberto Pineda-Anchecta, 38, a Honduran national, of kidnapping following a two-day trial. U.S. District Judge Robert J. Conrad Jr. presided over the trial.
Ronnie Martinez, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) in Charlotte, and Chief Kerr Putney of the Charlotte Mecklenburg Police Department (CMPD), join U.S. Attorney Murray in making today’s announcement.
According to filed court documents, evidence presented at trial and witness testimony, on or about May 15, 2019, CMPD officers arrested Pineda-Anchecta on several state charges, including Assault on a Female and Communicating Threats against his ex-girlfriend, identified in court documents as F.M. Two days following his arrest, Pineda-Anchecta was released from state custody on bond. As trial evidence established, in the evening of May 21, 2019, F.M. was approached by two masked men as she was walking to her vehicle parked at her apartment complex in Charlotte. The victim recognized one of the masked men as Pineda-Anchecta, who proceeded to grab the victim by the arm, stuff a cloth in her mouth, and then wrap a cord or rope around her head so the cloth would stay in place. Pineda-Anchecta and the other masked man forced F.M. against her will into the passenger seat of a vehicle, and Pineda-Anchecta told F.M. “I love you and I’m going to kill you.” According to trial evidence, the other masked individual did not accompany Pineda-Anchecta and F.M. in the vehicle.
Pineda-Anchecta then drove his vehicle on Lancaster Highway. Trial evidence established that while Pineda-Anchecta was driving, he maintained a tight grip on the plastic rope tied around the victim’s face. After traveling a short while on Lancaster Highway, Pineda-Anchecta parked his vehicle on the side of the road near a wooden area and turned off the vehicle’s engine. Pineda-Anchecta maintained his grip on the plastic rope around F.M.’s face, and pulled the victim out of the car. Witness testimony revealed that Pineda-Anchecta dragged the victim to wooded area off of Lancaster Highway with which he was familiar, as the defendant had gone fishing there on previous occasions.
Following a struggle between Pineda-Anchecta and F.M., the victim was able to escape and run into the middle of the highway, and was assisted by motorists who stopped to offer help. According to trial evidence, the victim identified Pineda-Anchecta as the person who had assaulted her. Pineda-Anchecta left the scene on foot. After obtaining a search warrant, CMPD officers searched Pineda-Anchecta’s vehicle, from which they recovered a spool of plastic rope similar to the rope wrapped around the victim’s face during the course of the kidnapping. Law enforcement also located the victim’s phone in Pineda-Anchecta’s vehicle.
Pineda-Anchecta is currently in federal custody. He was previously convicted of illegal reentry by a deported alien, and, on January 7, 2020, he was sentenced to seven months in prison. The kidnapping charge carries a maximum term of life in prison. A sentencing date has not been set.
In making today’s announcement U.S. Attorney Murray commended ICE’s Homeland Security Investigations and CMPD for their investigation of this case. He also thanked ICE’s Enforcement and Removal Operations for their assistance.
Assistant U.S. Attorneys Kenneth Smith and Regina Pack, of the U.S. Attorney’s Office in Charlotte, are prosecuting the case.
Department of Justice Announces $42 Million to Combat Illegal Manufacture and Distribution of Methamphetamine and OpioidsRead the Press Release
CHARLOTTE, N.C. - The Department of Justice’s Office of Community Oriented Policing Services (COPS Office) today announced nearly $42 million in funding to support state-level law enforcement agencies in combating the illegal manufacturing and distribution of methamphetamine, heroin, fentanyl, carfentanil, and prescription opioids, of which $2,062,770 has been awarded to the North Carolina Department of Public Safety.
“The scourge of opioid and methamphetamine use continues to take a devastating toll on our nation’s communities,” said COPS Office Director Phil Keith. “By providing these resources to law enforcement to help combat the further spread, the COPS Office is demonstrating our commitment to this Administration’s priority of reducing drug use and protecting our citizens from this public health and safety crisis.”
“I am pleased that the COPS office has awarded more than $2 million to the North Carolina Department of Public Safety,” said U.S. Attorney Murray. “The funding announced today will bolster our continued efforts with our state law enforcement counterparts to investigate and disrupt drug trafficking rings that spread deadly substances like methamphetamine and heroin to communities across our state.”
“We are extremely grateful for this important funding which will enable us to enhance our law enforcement efforts at combating illegal drug trafficking and stemming the tide of dangerous drugs in our communities. These grant funds will further enable the State Bureau of Investigation to fulfill their public safety mission by leveraging important partnerships and maintaining their investigative expertise,” said Public Safety Secretary Erik A. Hooks.
Drug overdose deaths and opioid-involved deaths continue to increase in the United States. Deaths from drug overdose are up among both men and women, all races, and adults of nearly all ages, with more than three out of five drug overdose deaths involving opioids. More than 130 people die every day in the United States after overdosing on opioids, while methamphetamine continues to be one of the most commonly misused stimulant drugs in the world and is the drug that most contributes to violent crime.
The COPS Office is awarding more than $29.7 million in grant funding to 14 state law enforcement agency task forces through the Anti-Heroin Task Force Program (AHTF). AHTF provides three years of funding directly to state-level law enforcement agencies with multijurisdictional reach and interdisciplinary team (e.g., task force) structures, in states with high per capita rates of primary treatment admissions for heroin, fentanyl, carfentanil, and other opioids. This funding will support the location or investigation of illicit activities through statewide collaboration related to the distribution of heroin, fentanyl, or carfentanil or the unlawful distribution of prescription opioids.
Through the COPS Anti-Methamphetamine Program (CAMP), the COPS Office is also awarding $12 million to 12 state law enforcement agencies. These state agencies have demonstrated numerous seizures of precursor chemicals, finished methamphetamine, laboratories, and laboratory dump seizures. State agencies are being awarded three years of funding through CAMP to support the location or investigation of illicit activities related to the manufacture and distribution of methamphetamine, including precursor diversion, laboratories, or methamphetamine trafficking.
The AHTF and CAMP funding has a tremendous impact on state investigative and seizure work. During the five month period between October 2019 and February 2020, current AHTF grantees reported the seizure of over $4 million in cash and 1,213 firearms. Similarly, for CAMP, grantees reported seizures of more than $7 million in cash and 1,577 firearms.
The complete list of Anti-Heroin Task Force Program award recipients, including funding amounts, can be found here: https://cops.usdoj.gov/ahtf-award
The complete list of COPS Anti-Methamphetamine Program award recipients, including funding amounts, can be found here: https://cops.usdoj.gov/camp-award
The COPS Office is a federal agency responsible for advancing community policing nationwide. Since 1994, the COPS Office has invested more than $14 billion to advance community policing, including grants awarded to more than 13,000 state, local and tribal law enforcement agencies to fund the hiring and redeployment of approximately 135,000 officers and provide a variety of knowledge resource products including publications, training and technical assistance. For additional information about the COPS Office, please visit www.cops.usdoj.gov.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years
Convicted Sex Offender Is Sentenced to 12 Years for Possessing Child PornographyRead the Press Release
ASHEVILLE, N.C. – Today, U.S. District Judge Max O. Cogburn Jr. sentenced Jordan Cole Laws, 21, of Burnsville, N.C., to 12 years in prison on child pornography charges, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. Laws was also ordered to pay a $5,000 special assessment, to serve a lifetime of supervised release, and to register as a sex offender after he is released from prison.
Ronnie Martinez, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) in Charlotte, and Sheriff Gary Banks of the Yancey County Sheriff’s Office join U.S. Attorney Murray in making today’s announcement.
According to information contained in filed documents and statements made in court, in April 2019, law enforcement conducted an operation that included warrantless searches of convicted sex offenders in Yancey County, North Carolina. At the time, Laws was under supervision by North Carolina state probation for a 2018 conviction in Texas for Indecency with a Child. Court records show that during a search of Laws’ residence, law enforcement discovered on the defendant’s cell phone several videos and still images depicting child pornography, which led to the seizure of three cell phones that belonged to Laws. A forensic analysis of the seized devices revealed that Laws possessed several images depicting children engaging in sexually explicit conduct. On December 2, 2019, Laws pleaded guilty to possession of child pornography.
In making today’s announcement, U.S. Attorney Murray thanked HSI and the Yancey County Sheriff’s Office for conducting the investigation. The U.S. Attorney’s Office in Asheville prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (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.
Two Sentenced for Robbing Two Cell Phone Stores at GunpointRead the Press Release
CHARLOTTE, N.C. – Chief U.S. District Judge Martin Reidinger sentenced to prison two men responsible for the armed robberies of two cell phone stores located in Buncombe and Henderson Counties, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.
Joining U.S. Attorney Murray in making today’s announcement is John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, Sheriff Quentin Miller of the Buncombe County Sheriff’s Office, Sheriff Lowell S. Griffin of the Henderson County Sheriff’s Office, and Chief David Zack of the Asheville Police Department.
Shyleek Vyshonne Davidson, 21, of Hendersonville, N.C. was sentenced to 120 months in prison and five years of supervised release, and Okoye Unique Porter, 26, of Hendersonville, was sentenced to 151 months in prison and three years of supervised release. The third co-defendant, Kristoff Michael Hunter, 25, of Asheville, will be sentenced at a later date.
According to filed documents and statements made in court, the men robbed at gunpoint two cell phone stores located in Asheville and in neighboring Hendersonville. On May 19, 2019, Hunter and Davidson robbed the AT&T wireless store located at 335 Airport Road in Asheville. Court records show that Hunter and Davidson entered the store with their faces covered, pointed a firearm at an employee and ordered him to lie down while they proceeded to steal approximately $200 in cash from the register and at least 26 Samsung and LG phones from the store cabinets.
The next day, on May 20, 2019, at about 9:30 a.m., law enforcement responded to a robbery call made from the Verizon Wireless store located at 1602 Four Seasons Blvd in Hendersonville. Court records show that all three defendants entered the store, brandished firearms at the store employees, and fled with approximately 157 stolen iPhones valued at $147,986, and $311 in cash. Law enforcement arrested the three men the same day, after locating them through a tracking device one of the store employees had slipped in the robbers’ bag.
Porter, Davidson and Hunter pleaded guilty to robbery of businesses affecting interstate commerce, also known as “Hobbs Act” robbery. Davidson and Hunter also pleaded guilty to carrying and brandishing a firearm during a crime of violence and aiding and abetting.
In making today’s announcement, U.S. Attorney Murray thanked the FBI, the Buncombe County Sheriff’s Office, the Henderson County Sheriff’s Office, and the Asheville Police Department for their investigation of this case.
Assistant U.S. Attorney John Pritchard, of the U.S. Attorney’s Office in Asheville, prosecuted the case.
Robbinsville Man Is Sentenced to 12 Years for Sexually Abusing A Minor on Indian ReservationRead the Press Release
ASHEVILLE, N.C. – Joseph Dwayne Jumper, 39, of Robbinsville, N.C., was sentenced today to 144 months in prison for the sexual abuse of a minor in Indian Country, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. In addition to the prison term imposed, U.S. District Judge Martin Reidinger also ordered Jumper to serve a lifetime of supervised release, and to register as a sex offender after he is released from prison.
Chief Doug Pheasant, of the Cherokee Indian Police Department, joins U.S. Attorney Murray in making today’s announcement.
According to court documents and today’s sentencing hearing, between July and August 2018, Jumper, who is an enrolled member of the Eastern Band of Cherokee Indians, sexually abused a minor female entrusted in his care. As Jumper previously admitted in court, the defendant sexually abused the victim on multiple occasions. The sexual abuse took place in Graham County, within the boundaries of the Indian reservation.
On January 3, 2020, Jumper pleaded guilty to two counts of abusive sexual contact of a child under 12.
In making today’s announcement, U.S. Attorney Murray thanked the Cherokee Indian Police Department for their investigation of this case.
Assistant U.S. Attorney John Pritchard, of the U.S. Attorney’s Office in Asheville, prosecuted the case.
Career Offender Is Sentenced to 13 Years in Prison on Drug ChargesRead the Press Release
ASHEVILLE, N.C. – U.S. Attorney Andrew Murray announced today that Tristan August Fleming, 32, of Hendersonville, N.C., was sentenced to 13 years in prison on drug charges. In addition to the prison term imposed, Fleming was ordered to serve five years under court supervision upon completion of his prison term.
Ronnie Martinez, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) in Charlotte, and Tommy D. Coke, Inspector in Charge of the Atlanta Division of the U.S. Postal Inspection Service, which oversees Charlotte, join U.S. U.S. Attorney Murray in making today’s announcement.
Court records show that, in May 2018, Belgian Customs Officers intercepted a package addressed to “Taylor McKnight” that contained suspected narcotics, including MDMA, cocaine, ketamine, and LSD. Law enforcement determined that the address on the package was that of a packing and shipping business located in Asheville. After retrieving the illegal substances, law enforcement in the United States arranged a controlled delivery of the package. On June 11, 2018, Fleming entered the shipping business in Asheville and claimed the package. Law enforcement arrested Fleming shortly thereafter. Following a search of his vehicle, law enforcement located drugs in a hidden compartment in Fleming’s vehicle, a wallet containing multiple fraudulent driver’s licenses, and other drug paraphernalia. Elsewhere in the vehicle, law enforcement recovered thousands of dosages of LSD, and $1,020 in drug proceeds.
On October 22, 2019, Fleming pleaded guilty to possession with intent to distribute narcotics. Based on multiple prior drug trafficking convictions, Fleming was sentenced as a career offender.
In making today’s announcement, U.S. Attorney Murray thanked HSI and USPIS for leading the investigation, and commended the North Carolina Highway Patrol for their assistance with this investigation.
Assistant U.S. Attorney John Pritchard, of the U.S. Attorney’s Office in Asheville, prosecuted the case.
California Man Is Sentenced to More Than Six Years in Prison for Bank Fraud and Aggravated Identity TheftRead the Press Release
CHARLOTTE, N.C. – U.S. Attorney Andrew Murray announced that Jihoon Sun, 48, of California, was sentenced to 75 months in prison and three years of supervised release for bank fraud and aggravated identity theft. U.S. District Judge Max O. Cogburn Jr. presided over yesterday’s sentencing hearing and also ordered Sun to pay $235,438 as restitution.
Tommy D. Coke, Inspector in Charge of the Atlanta Division of the U.S. Postal Inspection Service, which oversees Charlotte, joins U.S. U.S. Attorney Murray in making today’s announcement.
According to information contained in court documents and court proceedings, from November 2016 to May 2017, Sun and his co-conspirators used multiple victims’ stolen identities to execute a bank fraud scheme and to defraud several financial institutions. Court records show that Sun and his co-conspirators stole the identities of legitimate bank account holders, including holders of home equity lines of credit (HELOCs), and used the stolen account holders’ identities to fraudulently obtain funds from the financial institutions through cash advances and cashiers’ checks. To perpetuate the fraud, Sun and others obtained fraudulent forms of identification in the identity victims’ names, including fake drivers’ licenses, fake paystubs, and fake proofs of insurance. Sun and his co-conspirators then deposited the stolen funds into other bank accounts, established using the stolen identities of another set of identity theft victims. These “straw accounts” were controlled by the conspirators, and were used to convert the funds to cash at bank branches located in Mecklenburg County. In this manner, the co-conspirators stole or attempted to steal more than $290,000 in cash and cashiers’ checks.
On July 2, 2019, Sun pleaded guilty to bank fraud conspiracy and aggravated identity theft. In making today’s announcement, U.S. Attorney Murray thanked USPIS for their investigation of this case and the Charlotte-Mecklenburg Police Department for their assistance.
Assistant U.S. Attorney William Bozin, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.
U.S. Attorney's Office Joins the Justice Department to Observe the 15th Annual World Elder Abuse Awareness DayRead the Press Release
CHARLOTTE, N.C. – Today, U.S. Attorney Andrew Murray joined Attorney General William P. Barr and the entire Department of Justice in observing the 15th Annual World Elder Abuse Awareness Day, and to echo voices around the world
condemning elder abuse, neglect and financial exploitation.
“On this day, we shed a light on crimes perpetuated against older Americans and vow to continue to pursue relentlessly bad actors who exploit one of our nation’s most vulnerable populations. As U.S. Attorney, my mission is to prevent elder fraud through education and awareness, and bring to justice vile criminals who target seniors and inflict physical or financial harm upon the elderly,” said U.S. Attorney Murray.
In March 2019, U.S. Attorney Murray announced the Western District’s Elder Justice Initiative, which aims to combat elder financial exploitation by expanding efforts to investigate and prosecute financial scams that target seniors; educate older adults on how to identify scams and avoid becoming victims of financial fraud; and promote greater coordination with law enforcement partners. Since then, the office has prosecuted cases that run the gamut of scams targeting older Americans, including international telemarketing scams, tech support scams, romance scams, investment schemes, and financial fraud exploiting infirm elderly victims.
U.S. Attorney Murray noted, “Every day, elderly Americans are bombarded with fraudulent robocalls, spam emails and texts messages from scammers seeking to exploit them and steal their hard-earned savings. As technology increases, so does our responsibility to protect less tech savvy older adults from con artists. We must all do our part to ensure that seniors are aware of all forms of fraud, and they are properly educated on how to protect themselves from clever scammers with cunning tactics.”
U.S. Attorney Murray further noted that the COVID-19 pandemic has created unprecedented challenges for our country and the world, but among those most severely affected by the threat of the novel virus are our senior citizens. As the world takes this day to remember the elderly during these uncertain times, U.S. Attorney Murray underscored the importance of staying vigilant in protecting seniors who are vulnerable and isolated from their families and loved ones by social distancing and quarantine restrictions, and remind the public that bad actors have immediately exploited this international tragedy to prey on the elderly through a whole host of scams and fraudulent schemes.
On this day dedicated to recognizing our seniors, the U.S. Attorney’s Office sends a strong message that we continue the fight to keep seniors safe, and we will aggressively prosecute fraudsters exploiting the Covid-19 pandemic and targeting seniors.
“Through the department-wide Elder Justice Initiative and our local efforts, we remain relentlessly committed to preventing and prosecuting fraud on America’s seniors,” said U.S. Attorney Murray.
More information about the U.S. Attorney’s Office Elder Justice Initiative can be located here. For more information on department-wide enforcement actions, training and resources, research, and victim services, please visit www.justice.gov/elderjustice.