Western District of North Carolina
Press releases recorded for this federal judicial district.
U.S. Attorney's Office Partners with Asheville City Schools to Launch Empowerment Initiative for Middle School StudentsRead the Press Release
ASHEVILLE, N.C. – The United States Attorney’s Office has partnered with Asheville City Schools to launch an empowerment initiative for middle school students, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. The one-day youth summit was co-sponsored by the University of North Carolina – Asheville, the Sparc Network and the Grove Park Inn.
Approximately 200 students selected from Asheville Middle School attended the summit, which was held on the campus of UNC-Asheville. The goal of the summit was to encourage middle school students to discuss the culture and climate within their schools, to share their experiences with classmates, and to develop solutions for creating a positive school environment for students.
“All students deserve the opportunity to reach their full potential and to thrive within their schools without fear of harassment, violence or bullying,” said U.S. Attorney Rose. “When students are engaged and learn how to become agents of change, they are empowered to proactively address conflict, solve problems and foster a more positive school experience for all students. The summit is an opportunity for character development and positive growth.”
During the one-day summit, student leaders from Asheville Middle School discussed their concerns about their school’s current environment and developed strategies to address social pressures, including bullying. Over the course of the summit, students participated in student-led discussions, brainstormed on ways to help support all students have a positive school experience and developed action plans to address the needs of their school.
“Our partnership with the U.S. Attorney’s Office and our collaboration with our community partners has been incredible,” said Superintendent Baldwin following today’s summit. “I want to thank everyone who is supporting our efforts in our students’ voice initiative and for supporting important changes for our city and our school district.”
In addition to the interactive workshops, students also heard from Professor Michelle Horton of Wake Forest University and Founder & CEO of YOUniversity; Mr. Reggie Bean, author of Unfinished: 40 Lessons on Purpose, Self, and Becoming a Man; Dr. Pamela White, Superintendent of Asheville City Schools; April Dockery Principal of Asheville Middle School; Chief Tammy Hooper of the Asheville Police Department; and Chancellor Mary Grant of UNC-Asheville.
In making today’s announcement U.S. Attorney Rose thanked UNC-Asheville for hosting the summit and giving the students an opportunity to gather, and the Grove Park Inn and the Sparc Network for their support of this very important initiative.
Fugitive Drug Trafficker Sentenced to More Than 12 YearsRead the Press Release
CHARLOTTE, N.C. – U.S. District Judge Max O. Cogburn, Jr. sentenced yesterday Reginald Glenn Patterson to 151 months in prison on drug conspiracy and money laundering charges, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Patterson, 45, of Los Angeles, California, was also ordered to serve 10 years under court supervision after he is released from prison.
U.S. Attorney Rose is joined in making today’s announcement by Nick Annan, Special Agent in Charge of ICE/Homeland Security Investigations (HSI) in Georgia and the Carolinas and Chief Kerr Putney of the Charlotte-Mecklenburg Police Department.
According to filed documents and statements made in court, Patterson was indicted in 2003 for his involvement in a drug conspiracy operating in the Charlotte area. He was arrested on federal charges in Los Angeles, California, in May 2003, and was subsequently released on a $50,000 bond. Court records show that in June 2005, Patterson failed to appear for his sentencing hearing in Charlotte and was declared a fugitive. According to court records, law enforcement obtained information on Patterson’s whereabouts over the course of an unrelated drug trafficking investigation and arrested Patterson in June 2015 in central California. Patterson previously admitted in court to trafficking over 3,000 kilograms of marijuana in and around Charlotte.
Patterson will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility. Federal sentences are served without the possibility of parole.
The investigation was led by HSI and CMPD. Assistant U.S. Attorney Sanjeev Bhasker, of the U.S. Attorney’s Office in Charlotte prosecuted the case.
Federal Indictment Charges Seth Pickering with First Degree MurderRead the Press Release
ASHEVILLE, N.C. – United States Attorney Jill Westmoreland Rose announced today that a federal grand jury sitting in Asheville has returned a criminal indictment against Seth Pickering, charging him with one count of first degree murder for allegedly killing his daughter, Lila Pickering. Seth Pickering, 36, of Leicester, N.C. was arrested on state charges on September 9, 2016 for Lila Pickering’s murder. On September 13, 2016, a criminal complaint was filed by the U.S. Attorney’s Office, bringing federal charges against Seth Pickering in connection with Lila Pickering’s death.
John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division; Neal D. Labrie, Chief Ranger of the Blue Ridge Parkway; and Sheriff Van Duncan of the Buncombe County Sheriff’s Office join U.S. Attorney Rose in making today’s announcement.
The criminal bill of indictment alleges that on September 9, 2016, Seth Pickering did unlawfully kill a human being within the boundaries of the Blue Ridge Parkway, that person being his daughter, Lila Pickering, who had not attained the age of 18 years and was under his care and control. The indictment further alleges that Seth Pickering killed Lila Pickering willfully, deliberately, maliciously and with premeditation, and in the perpetration of child abuse, that being knowingly and intentionally causing death and bodily injury to a child.
Seth Pickering is currently in federal custody. He is scheduled to appear in federal court today. The penalty for first-degree murder is life in prison or death. The indictment includes a Notice of Special Sentencing Factors which could permit the United States to seek the death penalty. The Department of Justice has not yet announced whether it will seek the death penalty.
An indictment is merely an allegation and the defendant is presumed innocent unless and until proven guilty beyond reasonable doubt in a court of law.
In making today’s announcement U.S. Attorney Rose thanked the FBI, the National Park Service and the Buncombe County Sheriff’s Office for their investigation of the case.
Assistant U.S. Attorneys Don Gast and David Thorneloe of the U.S. Attorney’s Office in Asheville are prosecuting the case.
U.S. Attorney Rose Announces More Than $2.8 Million in Federal Grants Awarded to Hire Community Policing OfficersRead the Press Release
CHARLOTTE, N.C. – U.S. Attorney Jill Westmoreland Rose announced today that over $2.8 million in grant funding has been awarded in the Western District through the Department of Justice, Office of Community Oriented Policing (COPS office) COPS Hiring Program (CHP), aimed at creating and/or rehiring 23 career law enforcement positions.
“The federal grants awarded build upon the Justice Department’s work to provide our local law enforcement partners with the resources they need to protect and serve their communities. The funds will be used to address specific law enforcement officers’ needs and to advance public safety through community policing and crime prevention efforts,” said U.S. Attorney Rose.
The three agencies awarded the grants in the Western District are the Charlotte Mecklenburg Police Department ($1,875,000), the Mooresville Police Department ($500,000) and the Monroe Department of Public Safety ($500,000).
CHP provides funding directly to state, local and tribal law enforcement agencies for the hiring and rehiring of entry-level career law enforcement officers in an effort to create and preserve jobs and increase community policing capacity and crime prevention efforts. The COPS Office is a federal agency responsible for advancing community policing nationwide. Since 1995, COPS has invested over $14 billion to advance community policing The complete list of award recipients can be found here: http://www.cops.usdoj.gov/default.asp?Item=2888.
National Community Policing Week
U.S. Attorney Rose also announced today that the Department of Justice has designated the week of October 3-7, 2016, as the inaugural National Community Policing Week. One of the key priorities of the Justice Department is to support and promote strong relationships between law enforcement and our communities. Community policing is a public safety philosophy based on partnership and cooperation between law enforcement and the individuals, families, and communities we serve and protect every day. At the center of community policing is the idea that all members of the community have a stake in the safety of our neighborhoods where we live and work and need to work together in solving the crime challenges our communities face.
“Community policing is about law enforcement partnering with communities to promote public safety and to proactively address the factors that give rise to crime and disorder. When the relationship between law enforcement and civilians is based on mutual trust and respect, our communities are safer, our neighborhoods are stronger and our citizens are more united. Trust, respect and mutual understanding is key to solving community problems. My Office is committed to promoting trust and building strong bonds between law enforcement and the communities we serve,” said U.S. Attorney Rose.
To promote Community Policing Week, the three U.S. Attorney’s Offices for the Western, Middle and Eastern Districts of North Carolina will hold a Community Policing Round Table for Sheriffs, Police Chiefs, and District Attorneys, on Friday, October 7, in Greensboro, N.C. U.S. Attorney Rose will participate on a panel to discuss best practices in community policing and to highlight collaborative programs and policing practices designed to advance public safety, strengthen police-community relations and foster mutual trust between local police officers and neighborhood residents.
For more information regarding National Community Policing Week please visit https://www.justice.gov/ag/community-policing-tour.
Duke Energy Carolinas, LLC Agrees to Pay $1.7 Million as Part of Settlement Reached by the Company with the United States and the Eastern Band of Cherokee IndiansRead the Press Release
ASHEVILLE, N.C. – A settlement has been reached by the United States and the Eastern Band of Cherokee Indians (EBCI) with Duke Energy Carolinas, LLC (Duke Energy) regarding a fire that burned over 2,300 acres of Tribal forest lands in the Big Cove area, announced the U.S. Attorney’s Office for the Western District of North Carolina and Principal Chief Patrick Lambert of the Eastern Band of Cherokee Indians.
The fire started on April 27, 2009 and burned for a week before being extinguished by fire fighters from the Bureau of Indian Affairs (BIA), the United States Forest Service (USFS), the National Parks Service (NPS), the U.S. Fish and Wildlife Service (USFWS), and the Cherokee Fire Department.
“Today’s settlement provides rightful compensation to EBCI for damage caused to Tribal forests. A portion of the monetary settlement will also compensate the agencies involved in the suppression of the fire and rehabilitation activities required as a result of the blaze. This settlement underscores the successful collaboration and continued cooperation between federal and Tribal partners over the course of this case,” said the U.S. Attorney’s Office in a statement today.
“When I took office last year, my priority was the protection and accountability of our Tribal resources. This includes our lands, our finances, and services to our members. We have relationships with many local, state and federal agencies that work together to ensure safety and prosperity for the constituents and customers we serve,” said Chief Lambert. “I thank Duke Energy for that gesture of respect. We are excited to bring our lands back under our ownership in Trust with the United states. It is good to know moving forward that we can work together to right any wrongs, and negotiate issues head-on for the public to have resolution,” Chief Lambert added.
As part of the settlement, Duke Energy has agreed to pay $1.7 million dollars, of which $1,210,128 will be paid to EBCI in compensation for damage to Tribal forests. The remaining $489,872 will be paid to federal agencies and the Cherokee Police Department for suppression, enforcement, and rehabilitation costs. The funds will be distributed among the federal agencies and Cherokee Fire Department based on costs incurred in responding to the fire.
In addition to the monetary settlement, Duke Energy has agreed to convey 35 acres of land located in close proximity to Kituwah, one of the seven Cherokee “Mothertowns” and known as the birthplace of the Cherokee people. In 1996, the EBCI purchased Kituwah, which according to Cherokee history is the place where the first Cherokee man and woman were born. Duke Energy’s transfer of the 35 acres of land recognizes the importance Kituwah plays in Cherokee culture, heritage, history and identity. EBCI will protect and preserve Kituwah for future generations.
In making today’s announcement, the U.S. Attorney’s Office commended the teamwork and dedication of the federal agencies and Tribal officials and praised their coordination and outstanding work leading to today’s settlement with Duke Energy.
The Department of Interior, BIA, USFS, NPS, USFWS, the EBCI Office of Attorney General and the Cherokee Fire Department led the investigation.
Assistant United States Attorneys Gill P. Beck and Brook Andrews with the Western District of North Carolina represented the United States and Hannah Smith, Senior Associate General, represented the Eastern Band of Cherokee Indians.
U.S. Attorney Rose Announces More Than $2.1 Million in Federal Grants Were Awarded in September 2016 to Local Law Enforcement and Community Organizations in the Western DistrictRead the Press Release
CHARLOTTE, N.C. – U.S. Attorney Jill Westmoreland Rose announced today that $2,116,025 in federal grants were awarded in September 2016 to local law enforcement agencies and community organizations in the Western District of North Carolina. The federal grants were awarded by the Office on Violence Against Women (OVW) and the Office of Justice Programs’ Bureau of Justice Assistance (BJA) and National Institute of Justice (NIJ).
A total of $1,081,143 was administered to two grantees by OVW, a component of the U.S. Department of Justice that focuses on reducing violence against women and administering justice for and services to victims of domestic violence, dating violence, sexual assault, and stalking. The two grants awarded by OVW in the Western District are:
Justice for Families Program: Under this program, a total of $600,000 has been awarded to the Mediation Center in Asheville, N.C., and its collaborative partners, Pisgah Legal Services, Safelight, and North Carolina’s Twenty Ninth Judicial District-29B, which includes Henderson, Polk and Transylvania Counties. The award will be used to open a supervised visitation and exchange center in Henderson County to serve at least 50 families, and to train 400 court and court-related personnel on domestic violence, dating violence and sexual assault.
Rural Domestic Violence, Dating Violence, Sexual Assault and Stalking Assistance Program (Rural Program): Under this program, a total of $481,143 was awarded to the Shelter Available for Family Emergency, Inc. of Transylvania County (SAFE). SAFE is a non-profit organization that has responded to domestic and sexual violence in Transylvania County. Through this program, SAFE will expand outreach and services to remote mountain communities, build new services for the growing Latino population and enhance the community’s response to sexual violence through the development of a Sexual Assault Response Team.
Another $728,780 was awarded via BJA’s Edward Byrne Memorial Justice Assistance Grant (JAG) Program to local police departments in six cities and sheriff’s offices in four counties throughout the Western District. The JAG Program, allows states and units of local government, including tribes, to support a broad range of activities to prevent and control crime based on their own local needs and conditions.
Under this program, the City of Charlotte ($493,021), Gaston County ($63,290), the City of Asheville ($55,150), the City of Hickory ($31,020), the City of Monroe ($18,651), the City of Statesville ($17,657), Iredell County ($15,029), the City of Shelby ($13,683), Wilkes County ($10,928), and Haywood County ($10,351) will use their share to address the needs of local police departments and sheriffs’ offices, through the funding of local initiatives, technical assistance, training personnel, equipment, supplies, and information systems as needed.
Also, $306,102 was awarded by the Office of Justice Programs’ National Institute of Justice (NIJ) to the City of Charlotte, under the DNA Capacity Enhancement and Backlog Reduction Program (CEBR). The Charlotte-Mecklenburg Police Department will use the funding awarded via this program to reduce the backlog of forensic biology/DNA cases, meet Quality Assurance Standards, and maintain current laboratory capabilities.
“Each year, federal grants deliver much-needed resources and financial assistance to local police departments, sheriff’s offices and community organizations throughout the Western District. The awards are used to address a broad range of needs, and to assist local efforts in reducing crime, improving public safety and increasing access to resources and services within communities,” said U.S. Attorney Rose.
The Office on Violence Against Women (OVW) currently administers 24 grant programs authorized by the Violence Against Women Act (VAWA) of 1994 and subsequent legislation. For a list of OVW grant programs and additional grant funding information please visit: http://www.justice.gov/ovw/grant-programs.
The Office of Justice Programs (OJP) provides innovative leadership to federal, state, local, and tribal justice systems, by disseminating state-of-the art knowledge and practices across America, and providing grants for the implementation of these crime fighting strategies. Current OJP funding opportunities can be found at: http://ojp.gov/funding/Explore/CurrentFundingOpportunities.htm.
The Bureau of Justice Assistance (BJA) provides leadership and assistance to local criminal justice programs that improve and reinforce the nation’s criminal justice system. BJA’s goals are to reduce and prevent crime, violence, and drug abuse and to improve the way in which the criminal justice system functions. In order to achieve such goals, BJA programs illustrate the coordination and cooperation of local, state, and federal governments. BJA works closely with programs that bolster law enforcement operations, expand drug courts, and provide benefits to safety officers. BJA Funding announcements are posted at: https://www.bja.gov/funding.aspx.
The National Institute of Justice (NIJ) is the research, development and evaluation agency of the U.S. Department of Justice and it is dedicated to improving knowledge and understanding of crime and justice issues through science. NIJ provides objective and independent knowledge and tools to reduce crime and promote justice, particularly at the state and local levels. For additional information and to locate a funding opportunity please visit: http://www.nij.gov/funding/Pages/welcome.aspx.
Two Charlotte Bloods Gang Members Plead Guilty for the the Double-Murder of Lake Wylie CoupleRead the Press Release
CHARLOTE, N.C. – U.S. Attorney Jill Westmoreland Rose announced today that Jamell Lamon Cureton, 24, and Malcolm Jarrel Hartley, 23, pleaded guilty to murder and related charges, for their respective roles in the 2014 double-murder of Douglas and Deborah London in Lake Wylie, S.C. Cureton also took responsibility for a previously unsolved murder, the death of Kwamne Donqurius Clyburn, in August 2013 in Charlotte. U.S. District Court Judge Max O. Cogburn, Jr. presided over today’s plea hearings.
John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division; Chief Kerr Putney of the Charlotte-Mecklenburg Police Department; and Sheriff Bruce Bryant of the York County Sheriff’s Office in South Carolina join U.S. Attorney Rose in making today’s announcement.
At today’s court appearance, Cureton pleaded guilty to a total of 10 counts: two counts of murder in aid of racketeering for the deaths of Douglas and Deborah London; two counts of use and carry of a firearm in relation to a crime of violence and possession of a firearm in furtherance of a crime of violence resulting in the deaths of Douglas and Deborah London; one count of racketeering conspiracy; one count of Hobbs Act robbery; one count of assault with a dangerous weapon in aid of racketeering activity; one count of use or carry of a firearm in relation to a crime of violence and possession of a firearm in furtherance of a crime of violence; one count of murder in aid of racketeering for the death of Kwamne Donqurius Clyburn; and one count of use and carry of a firearm in relation to a crime of violence and possession of a firearm in furtherance of a crime of violence resulting in the death of Kwamne Donqurius Clyburn.
Hartley pleaded guilty to a total of five counts: two counts of murder in aid of racketeering for the deaths of Douglas and Deborah London; two counts of use and carry of a firearm in relation to a crime of violence and possession of a firearm in furtherance of a crime of violence resulting in the deaths of Douglas and Deborah London; and one count racketeering conspiracy.
According to previous court filings, admissions contained in filed plea documents and today’s plea hearings:
Beginning at least in or about 2012, Cureton, Hartley and their co-defendants were members of the United Blood Nation gang (UBN or Bloods) in Charlotte. As UBN members, the defendants carried out violent acts for the purpose of protecting and furthering the gang’s power. Court documents show that the defendants operated according to a common set of Bloods’ rules and participated regularly in gang meetings to discuss, among other things, the commission of crimes, including robbery and murder.
Cureton, a.k.a. “Assassin” and “Murda Mel,” is a member of the Charlotte-area UBN and holds the rank of 5-Star General. As early as 2007, Cureton reported his affiliation with the UBN as a Valentine Blood. Law enforcement seized Cureton’s UBN “Book of Knowledge,” wherein he was identified as a 3-Star General and has since been promoted to a 5-Star General. As a 5-Star General, Cureton commanded the gang’s activities in the area. Hartley, a.k.a. “Silent” and “Bloody Silent,” is also a member of the Charlotte-area Valentine Blood set of the UBN. Hartley was “ranked up,” or “promoted,” to a 2-Star General, following the murders of Douglas and Deborah London.
On or about May 25, 2014, Cureton, Nana Yaw Adoma and David Lee Fudge robbed “The Mattress Warehouse” store, owned by the victims, Douglas and Deborah London, in Pineville, N.C. Federal charges were subsequently filed against Cureton, Adoma and Fudge in connection with the robbery. In the months that followed, Cureton communicated with Hartley and other UBN gang members and associates, including co-defendants Daquan Lamar Everrett, Randall Avery Hankins, II, Nehemijel Maurice Houston, Briana Shakeyah Johnson, Ibn Rashaan Kornegay, Centrilla Shardon Leach, and Rahkeem Lee McDonald to plan the murders of Douglas and Deborah London. In a letter Cureton sent from prison, Cureton explained that he ordered the murder of Douglas London because the victim was going to testify against him in court, and described Deborah London as “collateral damage.” The gang’s leadership authorized Hartley to proceed with the murder, and on or about October 23, 2014, Johnson drove Hartley to South Carolina, where Hartley shot and killed Douglas and Deborah London at their home.
Following the Londons’ murders, UBN leadership directed the gang members to “lay low” and to avoid contact with law enforcement. Cureton also told Hartley that from that point forward the topic of the victims’ murders was forbidden to be discussed and authorized action against any person who talked about it.
Today in court, Cureton also admitted that on August 22, 2013, Cureton, Adoma and Akheem McDonald murdered Kwamne Donqurius Clyburn, after luring him to Pressley Road Neighborhood Park, in Charlotte. Cureton admitted in court papers that the three gang members murdered Clyburn because they suspected that Clyburn was “false claiming” (falsely claiming to be a Bloods member), and because Clyburn failed a “DNA check,” meaning that they could not verify Clyburn’s claim to be a Blood.
“Cureton is responsible for the murders of three people, Kwamne Donqurius Clyburn, and Douglas and Deborah London. In 2013, Cureton participated in Clyburn’s murder to protect the gang’s reputation and to send a message to anyone who falsely claimed to be a Bloods member. A year later, Cureton ordered and orchestrated the murder of Douglas and Deborah London, and directed Hartley to take the lives of two innocent victims,” said U.S. Attorney Rose. “It is our hope that today’s guilty pleas will help bring closure to the families and friends of the three victims and allow the healing process to begin. We are thankful to the victims’ families for their continued support throughout this prosecution. I also commend the FBI for their outstanding investigative work and excellent cooperation and coordination with our local law enforcement partners in North and South Carolina,” Rose added.
“Jamell Cureton and Malcolm Hartley are violent and ruthless men who used their gang affiliations to commit heinous crimes against innocent victims. Due to the incredible cooperation and coordination between the FBI and our local law enforcement partners, they had no choice except to admit their crimes and accept their fate to spend the rest of their lives in federal prison. The FBI is pleased that the victims’ families will not have to relive the nightmare of what happened to their loved ones during a long trial,” said John Strong, the Special Agent in Charge of the Charlotte Division of the FBI.
At sentencing, Cureton and Hartley face a mandatory sentence of life in prison. In addition to Cureton and Hartley, co-defendants Fudge, Everett, Kornegay, Leach, Johnson, Houston and Rahkeem Lee McDonald previously pleaded guilty to federal charges, bringing to nine the total number of defendants who have entered guilty pleas in connection this prosecution. Sentencing dates for those defendants have not been set.
Three additional defendants, Adoma, Hankins and Ahkeem McDonald currently each face racketeering conspiracy charges. Ahkeem McDonald and Adoma are also charged with murder in aid of racketeering and use and carry of a firearm during and in relation to a crime of violence and possession of a firearm in furtherance of a crime of violence resulting in the death of Kwamne Donqurius Clyburn. Adoma is also charged with Hobbs Act Robbery, assault with a dangerous weapon in aid of racketeering activity and use or carry of a firearm in relation to a crime of violence and possession of a firearm in furtherance of a crime of violence for his role in the mattress store robbery. Randall Hankins is also charged with two counts of murder in aid of racketeering and two counts of use and carry of a firearm during and in relation to a crime of violence and possession of a firearm in furtherance of a crime of violence resulting in the deaths of Douglas and Deborah London.
The investigation was led by the FBI with the invaluable assistance of CMPD and the York County Sheriff’s Office. In making today’s announcement U.S. Attorney Rose also thanked York County Solicitor Kevin Brackett for his support and assistance throughout the investigation and prosecution of this case.
Assistant U.S. Attorneys Elizabeth Greene and Don Gast are prosecuting the case.
Huntersville, N.C. Man Sentenced to 30 Months for Securities Fraud SchemeRead the Press Release
CHARLOTTE, N.C. – Yesterday, Senior U.S. District Judge Graham Mullen sentenced a Huntersville man to 30 months in prison for his role in a securities fraud scheme involving fraudulent bonds, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Charles Edwin Abrams, a.k.a Charles Edwin Klutz and Charles Edwin Donovan, 53, was also ordered to serve two years under court supervision after he is released from prison, to pay $828,284 in restitution to victims, and to undergo mental health treatment.
John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division joins U.S. Attorney Rose in making today’s announcement.
According to information contained in filed documents and yesterday’s sentencing hearing, Abrams and his co-conspirator, Mark Burgin, engaged in a securities fraud scheme by promoting a fraudulent investment known as the Mexican “Pink Lady” Bonds (bonds). Court records indicate that Abrams induced his victims to invest in the fraudulent bond scheme by making numerous false and fraudulent claims about the value of the bonds and the anticipated return on the victims’ investment. For example, according to court records, Abrams told potential investors that the bonds were issued in 1899 by the “United States of Mexico,” that the bonds had a value of 5% interest compounded daily, and that victim investors would receive billions of dollars upon the sale of the bonds. Court records also show that, in furtherance of the conspiracy and to bolster the fraudulent scheme’s credibility, on at least two occasions Abrams introduced Burgin to potential victim investors as a former Special Agent with the FBI. Abrams also represented himself to be a former U.S. Navy SEAL, when in fact he never served in the military.
According to court records, Abrams induced a total of seven known investors to invest $828,284 in the fraudulent bond scheme. Instead of purchasing the bonds with the investors’ funds as promised, the co-conspirators used the money for their personal benefit, including the purchase of luxury vehicles, jewelry, and to pay off investors from previous fraudulent schemes.
During the sentencing hearing, one of Abrams’ victims addressed the Court and spoke of the devastating financial impact she has suffered as result of the scheme, including not being able to retire and that she “no longer trusts anyone.”
Abrams pleaded guilty in May 2016 to one count of wire fraud conspiracy and one count of securities fraud conspiracy. He will be ordered to report to the Federal Bureau of Prisons to begin serving his sentence upon designation of a federal facility. All federal sentences are served without the possibility of parole.
The investigation was led by the FBI. Assistant United States Attorney Kenneth M. Smith, of the U.S. Attorney’s Office in Charlotte prosecuted the case.
Prescription Opioid and Heroin Epidemic Awareness Week EventsRead the Press Release
CHARLOTTE/RALEIGH/GREENSBORO – The United States Attorney’s Offices for the Western, Middle, and Eastern Districts of North Carolina, in partnership with the Drug Enforcement Administration and the Federal Bureau of Investigation, announce the formation of the Federal Opioid Reduction Alliance for North Carolina, a coordinated state-wide effort to address the increasing dangers posed to the residents of North Carolina by heroin and opiate distribution, abuse, and overdose. The Alliance will work together with State and local partners to increase awareness, prevention efforts, and prosecutions related to heroin and other opioids in North Carolina. By implementing the attached Strategic Initiative, the United States Attorneys’ Offices hope to complement existing efforts across the state and enhance the ability of law enforcement to keep our communities safe.
In conjunction with the announcement of the Alliance, the United States Attorneys’ Offices will hold several events in observance of Prescription Opioid and Heroin Epidemic Awareness Week, September 18-24, 2016.
Within the Western District:
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September 19, 2016 – “We Are a Community United Against Heroin,” is a daylong heroin and opiate addiction awareness summit hosted by the U.S. Attorney’s Office in partnership with the DEA, the Eastern Band of Cherokee Indians and the Cherokee Indian Police Department, on the rising of prescription opiates and heroin abuse and the epidemic of heroin related overdose deaths on the reservation and surrounding areas in western North Carolina. This summit will educate community members, law enforcement and service providers about opiate and heroin distribution, the physiological effects of the drugs and introduce the community to interventions and best practices that are available within the boundaries of the EBCI and the western North Carolina region.
Within the Eastern District:
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September 20, 2016 - An Executive Session for Law Enforcement to discuss heroin & opioid abuse, distribution, and overdose issues. All Police Chiefs, Sheriffs, and Federal Law Enforcement Agency heads within the Eastern District of North Carolina are welcome to attend.
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September 22, 2016 - A Community Town Hall at the Pullen Park Community Center in Raleigh from 6:00 – 8:00 p.m. The opiate crisis we face is not just a crime problem, it is a community public health problem, and we hope you will join us for this important event.
Within the Middle District:
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September 20, 2016 - A Opiate Awareness Meeting at the Wesleyan Academy, Performing Arts Center, 1915 N. Centennial Ave., High Point, NC. The opiate crisis we face is not just a crime problem, it is a community public health problem, and we hope you will join us for this important event.
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September 22, 2016 - An Executive Session for Law Enforcement to discuss heroin & opioid abuse, distribution, and overdose issues. All Police Chiefs, Sheriffs, State and Federal Law Enforcement Agency heads within the Middle District of North Carolina are welcome to attend.
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"We Are A Community United Against Heroin"Read the Press Release
ASHEVILLE, N.C. – Today, the U.S. Attorney’s Office for the Western District of North Carolina in partnership with the U.S. Drug Enforcement Administration, the Eastern Band of Cherokee Indians (EBCI) and the Cherokee Indian Police Department hosted a day long community awareness summit on the epidemic of heroin and prescription opioid abuse and the related overdose deaths in Indian Country and surrounding areas in western North Carolina.
“Heroin addiction is not a public health concern. It is a public health crisis. The alarming rate of deaths attributed to heroin overdoses in the Western District of North Carolina and the increasing rate of addiction to opiates and prescription drugs demand our immediate attention,” said U.S. Attorney Jill Westmoreland Rose. “As law enforcement we cannot arrest our way out of this epidemic. The Justice Department’s three-pronged approach combines law enforcement action with prevention and treatment efforts. Stemming the flow of drugs, stopping more people from using opiates, and treating those who have become addicted requires coordination and collaboration with our state, local and tribal partners, community leaders, healthcare providers, service groups and community members. Working together we can succeed in implementing a comprehensive strategy that offers viable solutions, delivers sustainable results, and brings relief to afflicted communities,” U.S. Attorney Rose added.
Approximately 110 professionals from the fields of law enforcement, medicine, substance abuse and treatment, and interested community members attended the summit, held at the Chief Joyce Dugan Cultural Arts Center in Cherokee, N.C. Speakers from federal and local law enforcement agencies, medical experts and representatives of community organizations presented on a broad range of topics including: the alarming rise in heroin and opioid addiction; prevention efforts and available treatment options; heroin trafficking trends within the boundaries of the Eastern Band of Cherokee Indians and surrounding areas; and tribal, state, local and federal law enforcement efforts to stem the flow of opiates in the area.
U.S. Attorney Rose thanked the DEA, the Eastern Band of Cherokee Indians and the Cherokee Indian Police Department for co-sponsoring the event and emphasized the importance of the conference stating that, “Today’s summit is part of our ongoing effort to bring attention to heroin addiction and opioid drug abuse and to continue to build upon our collaborative efforts with law enforcement, the healthcare field and our community partners to confront this epidemic and address the problem in real and meaningful ways.”
“We Are A Community United Against Heroin": A Heroin and Opioid Community Awareness Summit, Cherokee, N.C.Read the Press Release
****** MEDIA ADVISORY *******
ASHEVILLE, N.C. – The U.S. Attorney’s Office for the Western District of North Carolina in partnership with the U.S. Drug Enforcement Administration, the Eastern Band of Cherokee Indians and the Cherokee Indian Police Department is hosting a community awareness summit on the rising of prescription opiates and heroin abuse and the epidemic of heroin related overdose deaths on the reservation and surrounding areas in western North Carolina. The summit will be held on MONDAY, SEPTEMBER 19, 2016 at 9:00 A.M. EDT.
U.S. Attorney Jill Westmoreland Rose and Principal Chief Patrick Lambert of the Eastern Band of Cherokee Indians will deliver the day’s opening remarks. Speakers and panel participants will discuss a variety of topics, including but not limited to, prescription drug and heroin abuse and addiction, overdose-related fatalities, law enforcement efforts to stem the flow of drugs, availability of community resources, outreach efforts and education to affected communities. This summit will educate community members, law enforcement and service providers about opiate and heroin distribution, the physiological effects of the drugs and introduce the community to interventions and best practices that are available within the boundaries of the EBCI and the western North Carolina region.
Help from the media in advancing news of this summit to encourage attendance by parents, teachers, faith-based organizations and other community leaders would be valuable in spreading the message. Attendance is free of charge but seating is limited.
Media is invited to cover the event from 9:00 to 10:00 a.m., beginning with welcome remarks of agency representatives who will also be available for on-camera interviews.
PRESENTERS: Jill Westmoreland Rose, United States Attorney, Western District of North Carolina
Principal Chief Patrick Lambert, Eastern Band of Cherokee Indians
Chris Fletcher, Special Agent, U.S. Drug Enforcement Administration
Richard Hutchinson, Special Agent, U.S. Drug Enforcement Administration Department
Dr. Steven Lloyd, Internal Medicine
Local Health Officials
Victims of Heroin and Opioids
WHAT: Heroin & Opioid Awareness Summit
WHEN: Monday, September 19, 2016, at 9:00 A.M. EDT
WHERE: Chief Joyce Dugan Cultural Arts Center
Cherokee Central Schools
260 Elk Crossing Lane
Cherokee, NC
(Enter through the Cherokee Middle School)
NOTE: Please arrive no later than 8:45 a.m. All media must present government-issued photo I.D. (such as a driver’s license) as well as valid media credentials. Press inquiries regarding logistics should be directed to Lia Bantavani at [email protected] or 704-338-3140.
NOT FOR RELEASE OR PUBLICATION, FOR PLANNING PURPOSES ONLY
Florida Man Convicted of Engaging in Child Exploitation EnterpriseRead the Press Release
A federal jury today convicted a Naples, Florida, man of engaging in a child exploitation enterprise and related charges for creating and running a website dedicated to the sexual abuse of children.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division; U.S. Attorney Jill Westmoreland Rose of the Western District of North Carolina; Special Agent in Charge John A. Strong of the FBI’s Charlotte, North Carolina, Division; Special Agent in Charge Harold H. Shaw of the FBI’s Boston Division; and Special Agent in Charge Paul Wysopal of the FBI’s Tampa, Florida, Division made the announcement.
Steven W. Chase, 57, was found guilty of one count of engaging in a child exploitation enterprise, one count of advertising child pornography, three counts of transportation of child pornography and one count of possession of child pornography. The jury also returned a special verdict determining that Chase should be ordered to forfeit all property derived from, involved in, or traceable to his criminal activities, to include his Naples residence.
Evidence at trial established that Chase created and served as the primary administrator of a highly-sophisticated global enterprise dedicated to the sexual abuse of children, via a website that operated on the Tor anonymity network, through which he and more than 150,000 other members authored and viewed tens of thousands of postings involving child pornography. Images and videos shared through the website were highly categorized towards victim age and gender, as well as the type of sexual activity, according to trial evidence. Testimony at trial also established that website members employed advanced technological means in order to undermine law enforcement’s attempts to identify them, including the use of a hidden service on the Tor network and elaborate file encryption.
Chase was arrested following a court-authorized search of his home on Feb. 19, 2015. Forensic examination of a computer and devices seized pursuant to the search revealed that he was in possession of thousands of images depicting the sexual abuse of children as young as toddlers.
Chase’s co-defendants Michael Fluckiger, 46, of Portland, Indiana, and David Lynn Browning, 47, of Wooton, Kentucky, the co-administrator and global moderator of the website, respectively, pleaded guilty in December 2015 to engaging in a child exploitation enterprise for their roles in helping Chase run the website.
The FBI’s Violent Crimes Against Children Section, Major Case Coordination Unit and Digital Analysis and Research Center led the investigation, with assistance from the FBI’s Charlotte, Tampa and Boston Field Offices. Trial Attorney Reginald E. Jones of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Cortney Randall of the Western District of North Carolina 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 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.justice.gov/psc.
ZeekRewards' Former Chief Operating Officer and Former Senior Technology Officer Sentenced in Federal CourtRead the Press Release
CHARLOTTE, N.C. – U.S. District Judge Max Cogburn, Jr., sentenced Dawn Wright Olivares, 48, and Daniel C. Olivares, 34, both of Clarksville, Ark., to 90 and 24 months in prison, respectively, for their involvement in an $850 million Internet Ponzi scheme that promised victims a bogus return on investments, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina.
The two Arkansas residents were associated with the Lexington, N.C. based Rex Venture Group, LLC (RVG), which owned and operated Zeekler and ZeekRewards. In addition to the prison term imposed, Judge Cogburn also ordered each defendant to serve three years under court supervision. The restitution amount will be set at a later date.
Michael Rolin, Special Agent in Charge of the United States Secret Service, Charlotte Field Division and Thomas J. Holloman III, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division (IRS-CI) join U.S. Attorney Rose in making today’s announcement.
According to filed court documents and today’s sentencing hearings, from January 2010 through August 2012, Dawn Wright Olivares, her step-son, Daniel Olivares, and Paul Burks, the owner of RVG, conspired with each other and engaged in Ponzi scheme that raised more than $850 million through a sham internet-based penny auction company named “Zeekler” and its purported advertising division “ZeekRewards” (collectively “Zeek”). According to court records, the conspirators induced more than 900,000 victims – including over 1,500 victims in the Charlotte area – to invest in their fraudulent scheme, by falsely representing that Zeekler was generating massive retail profits from its penny auctions, and that the public could share in such profits through investment in ZeekRewards. Court documents indicate that, at one point, the conspirators claimed that investors would be guaranteed a 125% return on their investment.
Court records show that the co-conspirators represented that victim-investors in ZeekRewards could participate in the Retail Profit Pool (RPP), which supposedly allowed victims collectively to share 50% of Zeek’s daily net profits. The co-conspirators did not keep books and records needed to calculate such daily figures. Instead, Burks simply made up the daily “profit” numbers. Contrary to the conspirators’ claims, the true revenue from the scheme did not come from the penny auction’s “massive profits.” Instead, approximately 98% of all incoming funds came from victim-investors, which were then used to make Ponzi-style payments to earlier victim investors.
In addition to promising massive returns on investments, the conspirators used a number of ways to promote Zeek to current and potential investors. For example, the conspirators hosted weekly conference calls and leadership calls, where participants could call in and listen to Burks, Dawn Wright Olivares and others make false representations intended to encourage victim-investors to continue to invest money and to recruit others to invest in Zeek. Burks and Dawn Wright Olivares also organized and attended “Red Carpet Events,” where victim investors came to hear details of the scheme in person. During these events, Burks and his conspirators made false representations about the massive retail profits generated by Zeek. They also used electronic and print media, including websites, emails and journals, to make false and misleading statements about the success of Zeekler to recruit victim investors.
As the Ponzi scheme grew in size and scope it became unsustainable and it eventually began to unravel as the outstanding liability resulting from the bogus 125% return on investment continued to rise beyond control. By August 2012, the conspirators fraudulently represented to the collective victims that their investments were worth nearly $3 billion, but had no accurate books and records to even determine how much cash on hand was available to pay such liability. Contrary to representations made to victim investors, at that time, the conspirators had only $340 million available to pay out investors.
According to court records, Dawn Wright Olivares was closely involved in the strategic operations and ultimately served as the Chief Operations Officer of Zeek. Dawn Wright Olivares also owned 95% of Wandering Phoenix, LLC, a company that she used, among other things, to receive payments from Zeek and RVG. During the course of the conspiracy, Dawn Wright Olivares and Wandering Phoenix received approximately $7.2 million in victim funds.
Daniel Olivares was RVG’s senior technology officer and was responsible for, among other things, database design, management and operations for Zeek. During the course of the conspiracy, Daniel Olivares personally enriched himself with victim funds totaling approximately $3.1 million. Other unnamed co-conspirators also personally enriched themselves with millions of dollars of victim funds.
Dawn Wright Olivares and Dan Olivares previously pleaded guilty to one count of investment fraud conspiracy. Dawn Wright Olivares also pleaded guilty to one count of tax fraud conspiracy.
In July 2016, a federal jury convicted Paul Burks of wire and mail fraud conspiracy, wire and mail fraud, and tax fraud conspiracy, following a three-week trial. Burks is currently awaiting sentencing.
In making today’s announcement, U.S. Attorney Rose thanked the U.S. Secret Service and IRS-CI for investigating the case, and the U.S. Securities & Exchange Commission, Division of Enforcement for its assistance with the investigation.
The prosecution is handled by Assistant United States Attorneys Jenny Grus Sugar and Corey Ellis of the U.S. Attorney’s Office in Charlotte.
Additional information and updated court filings about this and related cases filings can be accessed at the district’s website: http://www.justice.gov/usao/ncw/ncwvwa.html.
Methamphetamine Trafficker Sentenced to More than 21 YearsRead the Press Release
STATESVILLE, N.C. – U.S. District Judge Richard L. Voorhees sentenced yesterday Eduardo Trejo-Munoz, a/k/a “Lalo,” 24, of Hickory, N.C., to 262 months in prison and five years of supervised release for trafficking high purity crystal methamphetamine worth over $5 million, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. In November 2015, Trejo-Munoz was convicted of five charges following a two-day federal trial, including conspiracy to distribute and to possess with intent to distribute methamphetamine and possession of methamphetamine with intent to distribute.
U.S. Attorney Rose is joined in making today’s announcement by Daniel R. Salter, Special Agent in Charge of the Atlanta Field Division of the Drug Enforcement Administration (DEA), which oversees the Charlotte District Office; Nick Annan, Special Agent in Charge of ICE/Homeland Security Investigations (HSI) in Georgia and the Carolinas; Sheriff Coy Reid of the Catawba County Sheriff’s Office; Sheriff Alan C. Jones, of the Caldwell County Sheriff’s Office; and Chief Thurman Whisnant of the Hickory Police Department.
According to filed court documents, the sentencing hearing and evidence presented at trial, from in or about 2013 through September 2014 in Catawba and Mecklenburg counties and elsewhere, Trejo-Munoz trafficked more than 50 kilograms of near-pure crystal methamphetamine, which constitutes approximately 500,000 dosage units, with a street value of more than $5 million. Evidence presented at trial established that, over the course of the investigation, law enforcement purchased 133 grams of methamphetamine from Trejo-Munoz. According to court records, law enforcement also seized another 54 grams of methamphetamine from the defendant, as well as drug paraphernalia and a handgun with laser site from his residence.
This prosecution stems from investigation of the Organized Crime Drug Enforcement Task Force (OCDETF) that has resulted in the conviction of more than 55 defendants on methamphetamine trafficking and firearms charges. 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.
Trejo-Munoz has been in federal custody since September 2014 and will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility. All federal sentences are served without the possibility of parole.
The case was investigated by the DEA, HSI, the Catawba County Sheriff’s Office, the Caldwell County Sheriff’s Office and Hickory Police Department, the North Carolina State Bureau of Investigation, and the North Carolina State Highway Patrol.The prosecution was handled by Assistant U.S. Attorney Steven R. Kaufman.
Federal Complaint Charges Buncombe County Man with MurderRead the Press Release
ASHEVILLE, N.C. B A federal criminal complaint was filed today charging Seth Willis Pickering, 36, of Leicester, N.C. with murder for the death of his daughter, Lila Pickering, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina.
U.S. Attorney Rose is joined in making today’s announcement by John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division; Neal D. Labrie, Chief Ranger of the Blue Ridge Parkway; and Sheriff Van Duncan of the Buncombe County Sheriff’s Office.
The affidavit filed with the criminal complaint alleges that late afternoon on September 9, 2016, Seth Pickering took Lila Pickering from the residence of the custodian where the victim had been placed temporarily by the Buncombe County Department of Health and Human Services (DHHS). Seth Pickering was only authorized to have supervised visitation with his daughter. The complaint alleges that the Buncombe County Sheriff’s Office responded to a call by the victim’s custodian regarding a missing juvenile, and were in the process of gathering information to initiate a report and issue an alert to law enforcement agencies. Meanwhile, two U.S. Park Rangers on routine patrol on the Blue Ridge Parkway (the “Parkway”) observed Seth Pickering’s vehicle parked along the shoulder of the Parkway near mile marker 393. The Rangers also observed a male and a juvenile female (later determined to be Seth and Lila Pickering) walking down a steep embankment. Knowing that there were no trails, picnic areas, or camp sites in the area, the Rangers began to investigate. The complaint alleges that as one of the Rangers approached the area where Seth Pickering and his daughter were located, Seth Pickering stabbed Lila Pickering with a knife, killing her.
Seth Pickering is currently in state custody and is expected to appear in U.S. District Court on the federal charges upon his transfer to federal custody.
A complaint is merely an allegation and the defendant is presumed innocent unless and until proven guilty beyond reasonable doubt in a court of law.
In making today’s announcement U.S. Attorney Rose thanked the FBI, the National Park Service and the Buncombe County Sheriff’s Office for their investigation of the case.
The prosecution is being handled by Assistant U.S. Attorneys Don Gast and David Thorneloe of the U.S. Attorney’s Office in Asheville.
Two Sisters Sentenced to More Than Seven Years in Prison on Drug Trafficking ChargesRead the Press Release
ASHEVILLE, N.C. – On Tuesday, September 6, 2016, U.S. District Max O. Cogburn, Jr. sentenced two sisters to 87 months in prison and five years of supervised release on drug trafficking charges, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Melissa Sigmon, 29, and Shana Sigmon, 26, both of Sylva, N.C. each pleaded guilty to one count of distribution of methamphetamine.
According to filed court documents and yesterday’s sentencing hearings, from about September 2014 to about January 2015, Melissa and Shana Sigmon were members of a drug network responsible for trafficking large quantities of methamphetamine in Georgia and Western North Carolina. Shana Sigmon ’s fiancée was running the distribution ring from inside a Georgia prison, where he was serving time for a narcotics trafficking offense. According to court records, Shana and Melissa Sigmon accepted multi-pound shipments of methamphetamine and then re-distributed the drugs to wholesale customers throughout Georgia and Western North Carolina. According to court records, over the course of the investigation Shana Sigmon was responsible for trafficking more than 14.5 kilograms of methamphetamine and Melissa Sigmon trafficked more than 12.5 kilograms of methamphetamine.
The defendants are currently in federal custody and will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility. All federal sentences are served without the possibility of parole.
U.S. Attorney Rose thanked the DEA, the North Carolina State Bureau of Investigation, the Jackson County Sheriff’s Office, the Swain County Sheriff’s Office, and the Catawba County Sheriff’s Office for handling the investigation. Assistant U.S. Attorney Thomas Kent of the U.S. Attorney’s Office in Asheville prosecuted the case.
Monroe, N.C. Man Sentenced to 17 1/2 Years on Drug Trafficking ChargesRead the Press Release
CHARLOTTE, N.C. –U.S. District Judge Robert J. Conrad, Jr. sentenced today James Ronald Helms, Jr., 49, of Monroe, N.C., to 210 months in prison, followed by four years of supervised release on drug conspiracy charges, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Helms was also ordered to forfeit $47,813 in drug proceeds.
John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, Sheriff Eddie Cathey of the Union County Sheriff’s Office and Chief J. Bryan Gilliard of the Monroe Police Department join U.S. Attorney Rose in making today’s announcement.
According to filed court documents and today’s sentencing hearing, on or about April 2015, law enforcement became aware that Helms was selling methamphetamine and cocaine from his residence located in Monroe. In or about June 2015, law enforcement executed a search warrant, seizing from Helms’ residence more than two (2) kilograms of methamphetamine with over 95% purity, over half a kilogram of cocaine, $47,813 in cash and a vehicle which contained narcotics. Court records show that law enforcement also seized from Helms’ residence 13 firearms, including two SKS assault rifles and ammunition.
In March 2016, Helms pleaded guilty to two counts of conspiracy to distribute and to possess with intent to distribute methamphetamine and cocaine. 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. All federal sentences are served without the possibility of parole.
In announcing today’s sentence, Judge Conrad stated, “The time has come to protect the community. Defendant’s drug trafficking life has caught up with him. He has done too much evil.”
The FBI, the Union County Sheriff’s Office and the Monroe Police Department handled the investigation. Assistant U.S. Attorney Sanjeev Bhasker of the U.S. Attorney’s Office in Charlotte prosecuted the case.
U.S. Attorney's Office Partners with Hickory Police Department to Launch Youth-Oriented Outreach InitiativeRead the Press Release
CHARLOTTE, N.C. –United States Attorney Jill Westmoreland Rose announced today that the U.S. Attorney’s Office partnered with the Hickory Police Department to present the Law Enforcement Guiding Adolescent Lives (LEGAL) program in Hickory, N.C. LEGAL is a youth-oriented community outreach initiative designed to offer young people guidance on having positive interactions with members of the law enforcement community.
The one-day program was held earlier today in Hickory, at LP Frans Stadium. Hickory Police Chief Thurman Whisnant and his officers worked closely with the U.S. Attorney’s Office to implement the initiative and to develop a curriculum that was informative, meaningful and fun for its participants. Volunteer officers with the Hickory Police Department and 20 youths selected from the Young People of Integrity group and the Hickory Youth Council participated in the program.
This was the second event held as part of the LEGAL outreach initiative. Over the summer, the U.S. Attorney’s Office partnered with the Buncombe County Sheriff’s Office and the Asheville Police Department to launch the pilot program, with the goal of collaborating with local law enforcement in Western North Carolina to implement the initiative throughout the district.
“This program is extremely valuable both to the young people and the volunteer law enforcement officers who participated today. The goal of the initiative is to establish positive police/youth relationships through education and open dialogue, and to foster the principles of mutual respect by learning from each other,” said U.S. Attorney Rose. “In doing so, we seek to foster a life changing experience for the participants and to develop a scenario whereby law enforcement officers and young people have more effective and ultimately more safe interactions within their communities.”
The four-hour program began with youth participants receiving legal and practical skills orientation. During this session, participants received basic legal background information on searches related to traffic stops, public area encounters, and home encounters. Participants also received practical instruction on their rights and on interacting with law enforcement in a sae and respectful manner.
Following the legal orientation, youth participants had an opportunity to utilize their newly acquired skills by engaging with law enforcement officers in mock police interactions. After each mock interaction, participants and law enforcement officers engaged in role-reversals, designed to foster a better understanding of each group’s standpoint and an opportunity to share each other’s perspective. Following the mock encounters, participants engaged in free dialogue with officer volunteers during a roundtable luncheon.
“The young men and women who took part in today’s program will benefit greatly from their participation. My officers volunteered many hours and worked diligently to make sure this program was a success. Those who participated were given very good practical information and each group had an opportunity to learn from each other. I want to thank the U.S. Attorney’s Office for partnering with the Hickory Police Department to bring this important initiative to Hickory’s youth,” said Chief Whisnant.
U.S. Attorney Rose thanked Chief Whisnant for his support of the LEGAL initiative. U.S. Attorney Rose also thanked the law enforcement officers and youth for participating in the program, and emphasized the importance of continuing to develop and support initiatives that promote positive youth development and enhance interactions between police and youth.
Three Individuals Indicted for $2.5 Million High-Yield Investment FraudRead the Press Release
Three individuals were charged in an indictment unsealed yesterday for their roles in a $2.5 million high-yield investment fraud scheme, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Jill Westmoreland Rose of the Western District of North Carolina.
Robert Leslie Stencil, 59, of Charlotte, North Carolina; Daniel Thomas Broyles Sr., 59, of Beverly Hills, California; and Kristian Francis Sierp, 45, of Costa Rica, all U.S. citizens, were charged in an indictment returned on Aug. 18, 2016, in the Western District of North Carolina with one count of conspiracy to commit wire fraud and mail fraud, five counts of mail fraud and eight counts of wire fraud. In addition, Stencil and Broyles were charged with two counts of money laundering and Sierp was charged with four counts of international money laundering. Stencil surrendered to authorities this morning and will have his initial court appearance today. Sierp was previously arrested in Fort Lauderdale, Florida, on separate charges and has been detained pending trial. A trial date has not been set.
The indictment alleges that since January 2012, Stencil, Broyles and Sierp worked to sell stock in Niyato Industries Inc., a Nevada corporation that Stencil owned and operated from Charlotte. Through various publications and sales pitches, Stencil, Broyles and Sierp allegedly marketed Niyato as a manufacturer of compressed natural gas (CNG) automobiles and a distributor of CNG fuel that had patented technology, valuable contracts and high-profile executives. According to the indictment, Stencil, Broyles and Sierp also sold investors on a promise that Niyato was planning an imminent stock IPO that would reap pre-IPO investors a tenfold return on their investments.
Stencil, Broyles and Sierp are alleged to have known that, in reality, Niyato had no facilities, products, patents or plans for an imminent IPO, but rather was merely a vehicle for inducing investor funds. Broyles and Sierp allegedly directed investors to mail or wire funds to Stencil, who then paid half the funds to Broyles and Sierp and kept the remainder for personal expenses. In addition, Broyles and Sierp are alleged to have used high-pressure sales tactics to encourage investments from their victims, many of whom were elderly. According to the indictment, Sierp operated under a fake name from a telemarketing call center that he owned and operated in Costa Rica.
According to the indictment, Stencil, Broyles, Sierp and their co-conspirators were responsible for causing at least $2.5 million in losses to more than 140 U.S. citizens and businesses.
The charges and allegations contained in an indictment are merely accusations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The U.S. Postal Inspection Service and Internal Revenue Service-Criminal Investigation conducted the investigation, which was supervised by the Criminal Division’s Fraud Section. Fraud Section Trial Attorneys William Bowne and Gustav Eyler are prosecuting the case.
Financial Services Company Executive Sentenced to 15 Months for Obstruction of JusticeRead the Press Release
The CEO of Preferred Merchants LLC, a financial services company based in Napa, California, was sentenced today in the U.S. District Court for the Western District of North Carolina to 15 months in prison for engaging in an elaborate obstruction of justice scheme to conceal from the government millions of dollars, which were subject to a freeze order and seizure warrant.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division; U.S. Attorney Jill Westmoreland Rose of the Western District of North Carolina; Special Agent in Charge Michael Rolin of the U.S. Secret Service’s Charlotte, North Carolina, Field Division; and Special Agent in Charge Thomas J. Holloman III of the Internal Revenue Service-Criminal Investigation (IRS-CI) Charlotte Field Office made the announcement.
On March 23, Jaymes Meyer, aka James Meyer, 47, pleaded guilty to one count of obstruction of justice. In addition to imposing the prison term, U.S. District Judge Max O. Cogburn Jr. of the Western District of North Carolina entered a monetary judgment of $4.8 million against Meyer.
According to the plea agreement, in or about 2012, the U.S. Securities and Exchange Commission’s (SEC’s) Division of Enforcement commenced a securities fraud investigation concerning a Ponzi scheme centering on Rex Ventures Group LLC (RVG), a North Carolina-based company for which Preferred Merchants held millions in assets in treasury and trust accounts. As a result of its investigation, the SEC filed a civil enforcement action against RVG, resulting in an order freezing all of RVG’s assets and appointing a receiver to marshal, manage and distribute remaining RVG assets to impacted investors. The U.S. Secret Service also obtained a seizure warrant of RVG assets held by Meyer through Preferred Merchants. Meyer admitted that in August 2012, the SEC informed him of, among other things, the investigation and the freeze order and requested that Meyer freeze any RVG assets in his possession, custody or control.
According to the plea agreement, in response to this request, Meyer misled the SEC by falsely implying that Preferred Merchants did not exercise dominion or control over any RVG assets when, in fact, Meyer controlled approximately $17.4 million in RVG assets. Meyer further admitted that he wired approximately $4.8 million from an RVG trust account to a brokerage account under his control after learning about the SEC’s investigation and used that money to purchase homes in Napa and the Turks and Caicos, and took additional measures to conceal his RVG assets.
Meyer also admitted that throughout the pending civil litigation surrounding the RVG scheme, he made fraudulent and misleading statements to the U.S. District Court for the Western District of North Carolina, the SEC and the court-appointed receiver during depositions.
In connection with his plea agreement, Meyer consented to the $4.8 million money judgment entered against him and forfeited the homes that he purchased in the Turks and Caicos and Napa as proceeds of the obstruction of justice offense.
The U.S. Secret Service and IRS-CI investigated the case. Assistant U.S. Attorney Jennifer Grus Sugar of the Western District of North Carolina and Trial Attorneys Kevin Lowell and Brian D. Frey of the Criminal Division’s Asset Forfeiture and Money Laundering Section – Bank Integrity Unit prosecuted the case.
Army Deserter Charged for Receiving Veteran Benefits Based on Fraudulent Service-Connected DisabilitiesRead the Press Release
ASHEVILLE, N.C. – U.S. Attorney Jill Westmoreland Rose announced today that Roy Lee Ross, Jr., a.k.a. Daniel Alfred Sullivan, Jr, 64, of Morganton, N.C., is facing multiple federal charges for defrauding the U.S. Department of Veterans Affairs (the VA) by receiving veteran benefits based on fraudulent service-connected disabilities.
Kim Lampkins, Special Agent in Charge of the Mid-Atlantic Field Office, Washington, D.C., of the U.S. Department of Veterans Affairs, Office of Inspector General (VA-OIG), joins U.S. Attorney Rose in making today’s announcement.
According to allegations contained in the federal indictment, Ross enlisted in the United States Army (the Army) in September 1973 under his true name. While in the Army, the defendant was stationed in the United States and in West Germany, but never served in Vietnam or Korea, was not in the Special Forces, and never sustained any service-connected injuries. The indictment alleges that while stationed in Hawaii in 1978, the defendant was determined to be Absent Without Leave (AWOL), and a “Deserter Verification” was issued for him. Ross was later apprehended and eventually requested to be discharged rather than undergo a court-martial. Ross’s official Department of Defense form known as “DD Form 214” or “Report of Separation,” indicates that the defendant was discharged “Under Conditions Other Than Honorable.”
According to allegations contained in the indictment, at least by June 2007, Ross began to falsely represent himself to the Charles George VA Medical Center (the VAMC) in Asheville, as a U.S. Army veteran named “Daniel Alfred Sullivan, Jr.” The indictment alleges that the defendant claimed that he had served in the Special Forces, that he had been wounded in combat, and that he had been honorably discharged from the Army. The indictment further alleges that Ross claimed he was suffering from nightmares caused by his wartime service and his combat-related injuries. As a result of his misrepresentations, in 2007, Ross was diagnosed with suffering from service related Post Traumatic Stress Disorder (PTSD) and began receiving health benefits from the VA.
The indictment alleges that in 2012, based on the PTSD diagnosis and other multiple false statements regarding his military service, including his fictitious injuries, honors and medals received, Ross filed for, and was granted, disability-based compensation at a rate of 60%, he was given a retroactive lump sum of $18,349 and began receiving a monthly tax-free compensation of $1,026. Then, in 2014, the defendant filed a second claim for “increased evaluation” seeking additional disability-based compensation. The indictment alleges that Ross, still using the name Sullivan, claimed he had been shot in the neck during combat, and that he was suffering from physical pain due to his service-connected injury. As a result of Ross’s false statements and accounts, his disability rating was increased, reflecting an increase in his monthly tax-free compensation to $1,743.48. Then in 2015, still falsely claiming to be Daniel Sullivan, the defendant filed a third claim for “increased evaluation,” claiming that he was suffering from cervical (neck) impairment and pain, due to his injuries while on active duty. The defendant was eventually granted his claim, and Ross received a $3,490.95 back payment award and his monthly disability payment was increased to $2,906.83.
The indictment alleges that in addition to his disability benefits, the defendant received approximately $57,000 in health care benefits from the VA, to which he was not lawfully entitled. The defendant also defrauded the VA’s Beneficiary Travel Program, after filing claims for mileage reimbursement in connection with his medical appointments. Lastly, the indictment alleges that Ross defrauded the Veterans Retraining Assistance Program (VRAP), by receiving $10,218.14 in VRAP payments. The VRAP program offers up to 12 months of training assistance at a VA-approved educational program and it is available to unemployed veterans who meet certain criteria.
“The actions of the defendant are contrary to the code of military conduct,” said U.S. Attorney Rose. “As alleged in the indictment, Ross received thousands of dollars in VA benefits based on lies and a fabricated military career. Ross allegedly conjured up stories about fighting in multiple wars and receiving the Purple Heart, a distinguished medal presented to our country’s bravest wounded in combat. Now, the scheme has been exposed and Ross, a disgraced deserter, must answer for his actions in a federal court.”
The federal criminal indictment charges Ross with one count of executing a scheme to defraud a health benefit organization (the VA), which carries a maximum penalty of 10 years in prison and a $250,000 fine; and two counts of making false statements in connection with the delivery of health care benefits by the VA, which carries a maximum penalty of five years in prison and a $250,000 fine. He is also charged with two counts of stealing from the VA, a charge that levies a potential maximum prison term of five years and a $250,000 fine, and one count of a making false claim for travel benefits from the VA, which carries a potential maximum prison term of five years and a $250,000 fine.
The charges contained in the indictment are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
In making today’s announcement U.S. Attorney Rose thanked the VA-OIG for their investigation of the case. Assistant U.S. Attorney Richard Edwards of the U.S. Attorney’s Office in Asheville is in charge of the prosecution.
Cherokee Co. Man Sentenced to More Than Seven Years in Prison on Federal Assault ChargesRead the Press Release
ASHEVILLE, N.C. – U.S. District Judge Martin Reidinger sentenced late yesterday Lowney Yohnagalegi Crow, 33, of Cherokee, N.C. to 87 months in prison on charges of assault resulting in serious bodily injury, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Judge Martin Reidinger also ordered Crow, who is an enrolled member of the Eastern Band of Cherokee Indians, to serve three years under court supervision after he is released from prison.
U.S. Attorney Rose is joined in making today’s announcement by John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, and Chief James Dike Sneed of the Cherokee Indian Police Department (CIPD).
“Crow’s then-fiancé suffered unspeakable violence by the man who claimed to love her. Crow beat his victim as she begged him to stop, telling her his intent was to make sure she never walked again. Then afterwards, Crow left the victim to suffer in pain overnight, finally agreeing to call for medical help after he instructed her on what to say about the cause of her injuries,” said U.S. Attorney Rose. “What Crow did to his victim is what millions of others suffer each day: domestic violence and physical, emotional, and psychological abuse at the hands of a loved one. Domestic violence can happen to anyone regardless of race, age, sexual orientation, ethnicity, religion, or gender, and it affects people of all socioeconomic backgrounds and education. It can also happen to intimate partners who are married, living together, or dating. I urge victims of domestic violence to reach out to my office, to law enforcement, to a local organization, or a loved one to alert them to their situation and to report this heinous crime. Help is available to assist domestic violence victims and to get them on a path to safety,” Rose added.
According to information contained in filed court documents and yesterday’s sentencing hearing, on March 30, 2014, officers with CIPD arrived to Crow’s residence in response to a 911 call regarding an attempted rape and assault at that location. The female victim, who was Crow’s fiancé at the time, told law enforcement officers that another individual had come into Crow’s house and attempted to sexually assault her. The officers found the alleged perpetrator laying on the floor inside Crow’s residence unconscious and in need of medical attention.
The following day, on March 31, 2014, the victim called 911 again, this time requesting transportation to the hospital because she was hurt. According to court records, at first, the victim declined to speak in detail to law enforcement and the emergency medical personnel on the scene regarding her severe injuries on her knees and abdomen. Crow also denied knowing who injured the victim when he was questioned. Court records show that later the same day and after Crow had left the hospital, the victim told law enforcement that Crow was the person who had assaulted her, after he accused her of being unfaithful to him. The victim told law enforcement that Crow had used a wooden baseball bat to hit her the night before, that the beating had lasted approximately 45 minutes, and that Crow only stopped hitting her when the bat he was using broke.
According to court records, the morning after the incident, Crow had carried the victim to the bathroom because she was unable to walk and finally agreed to get her medical attention for her injuries. Crow also told the victim to tell the police that he was not responsible for her injuries. According to court records, the victim suffered multiple fractures in her legs, hands and other parts of her body. She also required several surgeries and physical therapy before she could walk again.
An arrest warrant against Crow was issued in January 2015, following the filing of a federal complaint against him. Crow was located in California where he was arrested in January 2016. He pleaded guilty in April 2016 to one count of intentional assault resulting in serious bodily injury. 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. All federal sentences are served without the possibility of parole.
The investigation was handled by the FBI and CIPD. Assistant U.S. Attorney John Pritchard of the U.S. Attorney’s Office in Asheville prosecuted the case.
If you or someone you know is the victim of domestic violence, please call the National Domestic Violence Hotline at 1-800-799-SAFE (7233), 1-800-787-3224 (TTY), or visit: http://www.thehotline.org
South Carolina Man Sentenced to More Than Six Years for Tax Fraud ConspiracyRead the Press Release
ASHEVILLE, N.C. – Today, U.S. District Judge Martin Reidinger sentenced a South Carolina man to 75 months in prison on false claims conspiracy and aggravated identity theft charges, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Carmichael Cornilus Hill, 34, of Greenville, S.C. was also ordered to serve three years under court supervision and to pay $219,118 as restitution to the Internal Revenue Service.
Thomas J. Holloman III, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division (IRS-CI); Thomas L. Noyes, Inspector in Charge of the Charlotte Division of the U.S. Postal Inspection Service; and Michael Rolin, Special Agent in Charge of the United States Secret Service, Charlotte Field Division, join U.S. Attorney Rose in making today’s announcements.
According to court records and today’s sentencing proceedings, Hill provided his two co-conspirators, Senita Birt Dill and Ronald Jeremy Knowles, with fraudulently-obtained personal identification information of individuals which Dill and Knowles used to file more than 1,000 false tax returns resulting in the collection of more than $3.5 million in fraudulent tax refunds. According to court records, Hill obtained the individuals’ personal information (including names, dates of birth and social security numbers) through a variety of ways, including from an unindicted co-conspirator with access to that information. Hill then provided that information to Dill and Knowles for use in the tax fraud scheme. Court records indicate that Hill provided approximately 26% of the stolen identifications used to file the fraudulent returns.
Court records indicate that Dill and Knowles shared with Hill and other co-conspirators the fraudulently-obtained refunds. Court records also show that, at times, Hill permitted Dill to directly deposit the fraudulent refunds into his bank account.
Hill pleaded guilty in April 2016 to one count of false claims conspiracy and one count of aggravated identity theft. He will be ordered to report the Federal Bureau of Prisons upon designation of a federal facility. All federal sentences are served without the possibility of parole.
Dill and Knowles, formerly of Mill Spring, N.C., were previously sentenced to 324 and 70 months in prison, respectively, for their involvement in the conspiracy. Two additional defendants, Yolanda Kitson and Cara Michelle Banks were sentenced to 72 and 70-month prison terms for their participation in the tax fraud scheme.
The investigation was handled by IRS-CI, USPIS, and the U.S. Secret Service.
Assistant U.S. Attorney Don Gast of U.S. Attorney’s Office in Asheville was in charge of the prosecution.
More Than 16-Year Sentence Handed Down to South Carolina Man for Committing Murder on Federal LandRead the Press Release
ASHEVILLE, N.C. – Forrest Dakota Hill, 23, of Easley, South Carolina, was sentenced to federal prison today for 200 months for the 2015 murder of a male victim on federal land, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. U.S. District Judge Martin Reidinger also ordered Hill to serve five years of supervised release upon completion of his prison term.
U.S. Attorney Rose is joined in making today’s announcement by John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, Steven Kloster, Chief Ranger of the Great Smoky Mountains National Park, and Chief James Dike Sneed of the Cherokee Indian Police Department (CIPD).
According to court filings, plea documents and today’s sentencing hearing, on March 29, 2015, CIPD received a 911 call alerting officers to a stabbing that had taken place inside Oconaluftee Baptist Church, commonly known as the Smokemont Baptist Church, located within the boundaries of the Great Smoky Mountains National Park. Court records indicate that paramedics responding to the scene determined that the male victim had been stabbed and was deceased. According to court records, Hill, the victim and another individual drove to the church together, and over the course of their visit, Hill stabbed the victim with a knife during an unprovoked attack, causing the victim’s death. Following the fatal stabbing, Hill and his companion left the church and returned to Harrah’s Cherokee Casino where they picked up a companion and then departed for another local hotel.
According to court records, the victim was stabbed at least 16 times in the chest, back, neck and elsewhere. Court records indicate that the victim’s cause of death was “internal hemorrhage due to multiple stab wounds.”
“It takes a depraved person to kill another human being, but an evil one to carry out the murder inside a religious institution founded upon the belief in the sanctity of human life,” said U.S. Attorney Rose. “While we can never replace their loved one, we hope that Hill’s lengthy prison term will bring closure to the victim’s family and friends.”
“Today’s sentence ensures that a killer has been taken off our streets. I want to thank NPS and CIPD for their invaluable assistance with this investigation. This case is an example of federal and tribal law enforcement working together to bring justice to the citizens of western North Carolina,” said FBI Special Agent in Charge Strong.
“The National Park Service appreciates the coordination and cooperation of all involved agencies to bring this case to a successful prosecution,” said Chief Ranger Kloster.
Hill pleaded guilty to a second degree murder charge in April 2016. 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. All federal sentences are served without the possibility of parole.
The investigation was handled by the FBI, NPS and CIPD. Assistant U.S. Attorney John Pritchard of the U.S. Attorney’s Office in Asheville prosecuted the case.
Felon in Possession of A Firearm Sentenced in Federal CourtRead the Press Release
ASHEVILLE, N.C. – U.S. District Judge Martin Reidinger sentenced today a Transylvania Co. man to 41 months in prison for a federal firearms violation, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Bobie James Gibbens, 27, of Penrose, N.C. was also ordered to serve three years under supervised release upon completion of his prison term.
U.S. Attorney Rose is joined in making today’s announcement by C.J. Hyman, Special Agent in Charge of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Charlotte Field Division, Sheriff David A. Mahoney of the Transylvania County Sheriff’s Office and Chief John Phillip Harris, Jr. of the Brevard Police Department.
“Gibbens is a convicted felon who illegally possessed a loaded sawed-off shotgun and ammunition in a house occupied by young children. Unlawful gun possession is a serious offense and my office is committed to working closely with our law enforcement partners to identify and prosecute those who violate federal firearms laws,” said U.S. Attorney Rose.
“This investigation is another example of ATF working with our law enforcement partners to enforce the federal firearms laws and to keep our communities safe,” said ATF Special Agent in Charge Hyman.
According to filed court documents and statements made in court, on January 14, 2016, officers from the Transylvania County Narcotics Task Force executed a state search warrant at Gibbens’ residence. Court records show that while executing the search warrant, law enforcement recovered from the residence a Harrington & Richardson Topper Junior model 88 .410 gauge shotgun which had a sawed-off barrel and various caliber ammunitions, as well as narcotics and other drug paraphernalia. Court records show that Gibbens has multiple prior state offenses, including felony possession of stolen goods, breaking and entering, and sale/delivery of a controlled substance, and he is prohibited from possessing a firearm. Gibbens pleaded guilty in May 2016 to one count of possession of a firearm by a convicted felon.
Gibbens is currently in federal custody and he will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility. All federal sentences are served without the possibility of parole.
The investigation was handled by ATF, the Transylvania County Sheriff’s Office and the Brevard Police Department. Assistant U.S. Attorney Don Gast of the U.S. Attorney’s Office in Asheville prosecuted the case.
Buncombe Co. Man Sentenced to More Than Six Years in Prison on Child Pornography ChargesRead the Press Release
ASHEVILLE, N.C. – Erik Corbin Peterson, 47, of Black Mountain, N.C. was sentenced today by U.S. District Judge Martin Reidinger to 75 months in prison on child pornography charges, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Peterson was ordered to serve a lifetime of supervised release and to register as a sex offender. Peterson was also ordered to pay $17,000 in restitution to known victims of child pornography.
Sheriff Van Duncan of the Buncombe County Sheriff’s Office joins U.S. Attorney Rose in making today’s announcement.
According to court documents and information introduced at the sentencing hearing, in December 2013, law enforcement received a tip that an online user was using his e-mail to send child pornography via the Internet. Law enforcement determined that the e-mail account belonged to Peterson, who used it frequently to send to and receive from other unknown e-mail users images depicting the sexual abuse of children. In May 2014, law enforcement executed a search warrant at Peterson’s residence seizing a laptop computer, a desktop computer and an external hard drive. Forensic analyses of those devices revealed that Peterson possessed more than 1,000 images of child pornography, some of which depicted prepubescent minors engaging in sadistic and masochistic conduct.
In making today’s announcement, U.S. Attorney Rose said, “Peterson traded online images depicting the horrendous sexual exploitation of children. Then, he had the audacity to describe his depraved conduct as ‘a kind of game that he and some of his friends started.’ The sexual exploitation of innocent and vulnerable victims is not a game. It is a crime. And it is the type of criminal activity that my office takes very seriously. We hope today’s sentence delivers a clear message that possessing, receiving and sharing child pornography will land you in jail for a long time.”
Peterson pleaded guilty in April 2016 to one count of 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. All federal sentences are served without the possibility of parole.
U.S. Attorney Rose thanked the Buncombe County Sheriff’s Office for their investigation of this case. 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
Fifteen Methamphetamine Traffickers Sentenced to PrisonRead the Press Release
STATESVILLE, N.C. – U.S. District Judge Richard L. Voorhees handed down prison terms ranging from as much 235 to 51 months to 15 methamphetamine traffickers, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina.
The 15 defendants sentenced today and yesterday in U.S. District Court in Statesville are:
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Gregory Ryan Ellis, 39, of Jefferson, N.C. was sentenced to 235 months, followed by 5 years of supervised release. (5:15-cr-68)
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Todd Phillip Radar, 39, of Tonawanda, New York, was sentenced to 235 months, followed by 5 years of supervised release. (5:15-cr-45)
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Teofilo Salinas Cervin, 44, of Mexico, was sentenced to 210 months, followed by 5 years of supervised release. (5:16-cr-20)
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William Mitchell Lee Pope, 36, of Connelly Springs, N.C., was sentenced to 146 months, followed by 5 years of supervised release. (5:15-cr-44)
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Donald Ray Newton, 34, of Byron, Georgia, was sentenced to 131 months, followed by 5 years of supervised release. (5:15-cr-57)
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Eric Germaine Summers, 29, of Statesville, was sentenced to 121 months, followed by 5 years of supervised release. (5:15-cr-73)
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Adam Houston Stokes, 29, of Sherman Oaks, California, was sentenced to 120 months, followed by 5 years of supervised release. (5:15-cr-78)
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Codey Wayne Michaels, 25, of Valdese, N.C., was sentenced to 120 months, followed by 5 years of supervised release. (5:15-cr-76)
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Anthony Gwyn Lackey, 39, of North Wilkesboro, N.C., was sentenced to 92 months, followed by 5 years of supervised release. (5:15-cr-68)
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Ryan Lewis Craig, 33, of Conover, N.C., was sentenced to 83 months, followed by 4 years of supervised release. (5:15-cr-46)
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Blake Adam Masters, 27, of Clarkesville, Georgia, was sentenced to 78 months, followed by 4 years of supervised release. (5:15-cr-50)
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Lindsey Jordan Price, 22, of Taylorsville, N.C., was sentenced to 63 months, followed by 3 years of supervised release. (5:15-cr-44)
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Jennifer Irene Brown, 35, of Mooresville, N.C., was sentenced to 63 months, followed by 3 years of supervised release. (5:15-cr-50)
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Xavier Watson, 25, of Virginia Beach, Virginia, was sentenced to 51 months, followed by 3 years of supervised release. (5:13-cr-25
These prosecutions stem from an ongoing Organized Crime Drug Enforcement Task Force (OCDETF) investigation led by ICE’s Homeland Security Investigations (HSI), and the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), with the assistance of the North Carolina State Bureau of Investigation, North Carolina State Highway Patrol, Alexander County Sheriff’s Office, Alleghany County Sheriff’s Office, Ashe County Sheriff’s Office, Boone Police Department, Caldwell County Sheriff’s Office, Catawba County Sheriff’s Office, Hickory Police Department, Iredell County Sheriff’s Office, Lenoir Police Department, Lincoln County Sheriff’s Office, Mooresville Police Department, Pineville Police Department, Statesville Police Department, Burke County Task Force, and a host of law enforcement agencies throughout North Carolina, Texas, Georgia, and Tennessee.
To date, more than 90 individuals have been convicted as a result of the long term investigation. Court records show that the drug trafficking organizations involved have trafficked methamphetamine worth millions of dollars. Over the course of the investigation, law enforcement seized multiple kilograms of crystal methamphetamine, $100,000 in U.S. currency, 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 Rose thanked all the law enforcement agencies involved for their investigative efforts. Assistant U.S. Attorney Steven R. Kaufman of the U.S. Attorney’s Office in Charlotte is in charge of the prosecution.
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Charlotte Man Pleads Guilty to Perjury Charge for Lying Under Oath During TrialRead the Press Release
CHARLOTTE, N.C. B Jucorey Deonte Pruitt, aka Corey Deonte Pruitt, 25, of Charlotte, appeared in court today and pleaded guilty to a perjury charge for lying under oath during a federal trial, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. U.S. Magistrate Judge David S. Cayer presided Pruitt’s plea hearing.
U.S. Attorney Rose is joined in making today’s announcement by Daniel R. Salter, Special Agent in Charge of the Atlanta Field Division of the Drug Enforcement Administration (DEA), which oversees the Charlotte District Office; Chief Kerr Putney of the Charlotte Mecklenburg Police Department; Chief J. Bryan Gilliard of the Monroe Police Department; and Sheriff Eddie Cathey of the Union County Sheriff’s Office.
According to filed documents and statements made in court, Pruitt committed perjury during his testimony at the criminal trial of DeMorius Lamar Anderson (3:11-cr-3). Anderson was on trial on multiple federal charges including drug conspiracy, Hobbs Act Robbery and firearm violations. According to court records, Pruitt was a witness for the government and had agreed to testify regarding his knowledge of Anderson’s involvement in the drug conspiracy and other material information against Anderson.
According to court records, on August 9, 2012, while under oath and in an effort to aid Anderson, Pruitt denied knowledge of Anderson’s participation in the drug conspiracy. Pruitt’s assertions under oath were contradictory to prior statements he had made to law enforcement. During his testimony, Pruitt stated that he had previously lied to law enforcement regarding Anderson’s criminal activity, including his role in the drug conspiracy. Court records indicate that later that same evening, on jail house recordings, Pruitt admitted he lied to federal agents at trial. Anderson was eventually convicted by a jury and was sentenced to more than 37 years in prison.
“Pruitt chose to lie on the witness stand to protect one of his criminal associates. Despite Pruitt’s false testimony, the defendant was convicted by a jury and is serving a lengthy prison term. Now it’s Pruitt’s turn to sit in the defendant’s chair for lying under oath,” said U.S. Attorney Rose. “Perjury tarnishes our justice system and jeopardizes the integrity of judicial proceedings. Liars do not belong in the courtroom,” Rose added.
Pruitt is currently in federal custody. The perjury charge carries a maximum prison term of five years and a $250,000 fine. A sentencing date has not been set yet.
The investigation was handled DEA, CMPD, Monroe PD and the Union County Sheriff’s Office. The prosecution is being handled by the Assistant U.S. Attorney Sanjeev Bhasker of the U.S. Attorney’s Office in Charlotte.
Alexander Co. Man Sentenced to More Than Seven Years in Prison on Child Pornography ChargesRead the Press Release
STATESVLLE, N.C. – Joshua Lynn Cook, 32, of Hiddenite, N.C. was sentenced yesterday by U.S. District Judge Richard L. Voorhees to 89 months in prison on child pornography charges, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Cook was also ordered to serve a lifetime of supervised release and to register as a sex offender.
John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division and Sheriff Chris Bowman of the Alexander County Sheriff’s Office join U.S. Attorney Rose in making today’s announcement.
According to court documents and information introduced at the sentencing hearing, on April 14, 2014, law enforcement became aware that Cook was downloading and sharing child pornography on the Internet. On the same date, Cook shared child pornography with an undercover agent at least three times using a peer-to-peer network. During subsequent searches, law enforcement seized Cook’s electronic devices, including a computer and a cellphone. Forensic analyses of those devices revealed that Cook possessed more than 6,000 images and 427 videos of child pornography, some of which depicted prepubescent minors engaging in sadistic and masochistic or other violent conduct. Some of the images and videos contained identified victims of 123 different series of child pornography produced in various places, such as Washington, Germany and France.
Cook pleaded guilty in January 2016 to one count of transportation, one count of receipt and one count of 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. All federal sentences are served without the possibility of parole.
U.S. Attorney Rose thanked the FBI and the Alexander County Sheriff’s Office for their investigation of this case. Assistant U.S. Attorney Cortney Randall of the U.S. Attorney’s Office in Charlotte was in charge of the prosecution.
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
U.S. Attorney Announces Filing of Motion for Consent Order and Settlement Agreement Involving the Sale of Former Red Roof Inn Property in CharlotteRead the Press Release
CHARLOTTE, N.C. – U.S. Attorney Jill Westmoreland Rose announced that a consent motion for entry of order and settlement agreement were filed in federal court today, involving the sale of a property located at 3300 Queen City Drive, Charlotte, N.C., formerly known as Red Roof Inn.
In September 2015, the United States filed a civil complaint against the former Red Roof Inn property under federal forfeiture laws, alleging that the property had been used over several years to commit or to facilitate the commission of federal violations of law, including sex trafficking of minors, the transportation of minors for criminal sexual activity and felony drug trafficking crimes.
Federal forfeiture laws allow the United States to seek the forfeiture of property used to commit or facilitate the commission of certain offenses, in instances where the property owners have failed to take reasonable steps to reduce such crime. The complaint in this case alleged that the property owners, or their managing agents, had been repeatedly advised by the Charlotte Mecklenburg Police Department of the ongoing criminal activity at the motel and advised of specific measures that should be put in place to reduce criminal activity. The complaint further alleged that despite such notice and advisements, criminal activity at the motel continued.
Today, U.S. Attorney Rose announced that Shreeji Hospitality Queen City, LLC, (Shreeji), the former owner of the Red Roof Inn, has reached an agreement with the United States whereby the former Red Roof Inn property has been sold to a third party not related to the previous owner. This third party has also signed the federal settlement agreement and agreed, among other things, to invest $300,000 in the property to make improvements; to seek affiliation with a national chain hotel; and to impose specific rules and procedures to reduce crime to include: 1) installing a 24-hour video surveillance security system; and 2) ensuring the property does not rent rooms by the hour. Also pursuant to that agreement, and without admitting liability or guilt, Shreeji has agreed that $175,000 of the proceeds from the sale of the property will be paid to the United States. Thereafter, the United States will dismiss the civil case.
In making today’s announcement, U.S. Attorney Rose said that the United States may seek, in civil actions, the forfeiture of motels and other commercial properties where high levels of criminal activity occur and where the owners of such properties fail to take reasonable steps to reduce crime at such locations.
U.S. Attorney Rose also commended the Federal Bureau of Investigation, the U.S. Marshals Service and the Charlotte Mecklenburg Police Department for collaborating to achieve today’s outcome.
Copies of the civil complaint, the settlement agreement and related filed documents may be found at U.S. v. Real Property Located at 3300 Queen City Drive, Charlotte, North Carolina, a/k/a Red Roof Inn, 3:15-CV-429.
Former Headmaster Is Charged with Wire Fraud for Stealing Nearly $9 Million from Huntersville Area School and Affiliated ChurchRead the Press Release
CHARLOTTE, N.C. – Wayne C. Parker, Jr., the former headmaster of a Huntersville area parochial school is facing federal charges for embezzling nearly $9 million from the school and its affiliated church, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. A criminal bill of information was filed (today) in federal court, charging Parker with one count of wire fraud.
U.S. Attorney Rose is joined in making today’s announcement by John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, and Chief Cleveland L. Spruill of the Huntersville Police Department.
“For more than a decade, church members, parents, teachers, students and generous donors put their trust in Parker t lead their school and fulfill its goals and mission. Instead, Parker misused his access to the school and church’s finances, treating their bank accounts as an endless cookie jar, dipping in repeatedly to fund his lavish lifestyle. Parker then went to great lengths to conceal his fraud and to prevent law enforcement and others from uncovering the truth,” said U.S. Attorney Rose. “If Parker’s moral compass was not enough to stop him from breaking the law and ripping off those who put their faith in him, a good dose of American justice will.”
“It takes an especially ruthless person to steal money intended to educate children and promote religion and use it to bankroll an extravagant lifestyle you’d otherwise never be able to afford. Wayne Parker forced pay cuts for teachers during the great recession to fund building a million dollar lake home, bought multiple properties, a boat, even gold, all using the funds that rightfully belonged to a school and its affiliated church. The FBI will work tirelessly to uncover and expose these types of crimes, no matter what lengths offenders take to try and hide their fraudulent schemes,” said FBI’s Special Agent in Charge Strong.
“I am pleased that we were able to work with the FBI to put an end to more than a decade of thievery by Parker and that this investigation has resulted in charges being brought against him,” said Huntersville Police Chief Spruill. “His selfish actions violated the faith and trust of the church, the parents, the students and the community that he was entrusted with serving.”
According to allegations contained in filed court documents, from about January 2000 to in or about August 2014, Parker executed a scheme to defraud his employer, a parochial school (School) and its affiliated church (Church), both located in Huntersville, of at least $9 million, by embezzling Church and School bank funds to pay for his personal expenses and the personal expenses of an unnamed co-conspirator.
Parker, 59, of Mooresville, N.C., joined the Church in 1991. Court documents allege that sometime after joining the Church, Parker became volunteer treasurer, giving him access to and control over the Church bank accounts. In 1996, Parker was hired as Headmaster of the School, which was founded in 1994 by members of the Church. As headmaster, Parker was responsible for the administration of the School and its finances and had control over its bank accounts.
As alleged in filed court documents, beginning in at least 2000, Parker began stealing money from the Church and School and used it to pay for personal expenses. For example, in 2000, when he needed extra money to build a house for his family in Mooresville, Parker stole approximately $100,000 from the School and Church to complete the project. Over the next 14 years, court documents allege that Parker used School and Church funds to pay for numerous expenses, including, among other things, the purchase of multiple plots of real estate; the building of two homes, one costing over a million dollars; vacations around the world; luxury vehicles; luxury dining; Carolina Panthers preferred seats licenses; credit card bills; a boat and jet skis; gold and silver coins; and gifts for family and friends.
According to court records, as part of the scheme to siphon School and Church funds, and to hide his theft, Parker opened approximately 29 checking accounts, obtained 26 credit cards, seven loans, and created nine limited liability companies.
As alleged in filed court documents, in addition to embezzling funds for his own use, Parker also embezzled School and Church funds at the direction of an unnamed co-conspirator. Court documents allege that beginning in 2000, Parker issued additional paychecks to the co-conspirator above and beyond what he was entitled to by the terms of the co-conspirator’s employment. As the scheme progressed overtime, in addition to extra salary checks, Parker used Church and School funds to pay for the co-conspirator’s personal expenses, including college tuition, medical bills, taxes, cars, and credit card bills.
As part of his scheme, and to hide his embezzlement activities from the School’s governing board, Parker created a false, fraudulent and fictitious document from an accounting firm purporting to be the results of an audit, court documents allege. The document falsely stated that the School had been through a full audit and received an unqualified opinion letter giving the School a clean financial bill of health.
According to allegations contained in court documents, in the summer of 2014, after the Church leadership became suspicious of Parker’s activities and called for an independent audit, Parker intentionally stole and destroyed school financial records in an attempt to prevent law enforcement and others from discovering the nature and extent of his embezzlement activities. Additionally, Parker sold one of the houses that he had constructed with embezzled funds to one of his children, for a significantly undervalued price, to hide his crimes and prevent law enforcement from seizing that property. In total Parker’s scheme resulted in a loss of at least $9 million dollars to the Church and School.
A plea agreement was also filed today, and Parker is expected to appear before a U.S. Magistrate Judge to formally enter his guilty plea when the court schedules the plea hearing. The wire fraud charge carries maximum prison term of 20 years and a $250,000 fine. As part of his plea agreement, Parker has agreed to pay restitution, the amount of which will be determined by the Court at sentencing.
The investigation was handled by the FBI and the Huntersville Police Department. The prosecution for the government is being handled by Assistant United States Attorney Kevin Zolot of the U.S. Attorney’s Office in Charlotte.
Former ZeekRewards CEO Is Convicted of Federal Charges for Operating $900 Million Internet Ponzi SchemeRead the Press Release
CHARLOTTE, N.C. – U.S. Attorney Jill Westmoreland Rose announced that a federal jury sitting in Charlotte retuned a guilty verdict today against the former CEO of ZeekRewards for operating a $900 million Internet Ponzi scheme. Following a three-week trial, the jury convicted Burks, 69, of Lexington, N.C., of wire and mail fraud conspiracy, wire and mail fraud, and tax fraud conspiracy.
Michael Rolin, Special Agent in Charge of the United States Secret Service, Charlotte Field Division and Thomas J. Holloman III, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division (IRS-CI) join U.S. Attorney Rose in making today’s announcement.
“For nearly two years, Burks used deceit and dishonesty to engineer an extensive Ponzi scheme that amassed millions of dollars from thousands of victims, many in the Western District of North Carolina. This massive scam is one of the largest in breadth and scope ever prosecuted by this office. I commend the United States Secret Service and the IRS agents who worked closely with our prosecutors to unravel Burk’s fraud and to obtain a conviction against the mastermind of a scheme that has left so many victims with substantial losses. I want to remind the public to steer clear of ‘get rich’ schemes and to follow the old adage that if it looks too good to be true, it likely is,” said U.S. Attorney Rose.
“Today’s verdict is the result of a joint investigative effort and it is representative of the commitment the U.S. Secret Service and our partners have towards ensuring those intent on defrauding the citizens of North Carolina and the United States are held accountable,” said Special Agent in Charge Rolin.
According to filed court documents, court proceedings, evidence introduced at trial and witness testimony:
From January 2010 through August 2012, Paul Burks was the owner of Rex Venture Group, LLC (RVG), through which he owned and operated Zeekler, a sham Internet-based penny auction company, and its purported advertising division, ZeekRewards (collectively “Zeek”). Burks and his conspirators induced more than 900,000 victims – including over 1,500 victims in the Charlotte area – to invest in their fraudulent scheme, by falsely representing that Zeekler was generating massive retail profits from its penny auctions, and that the public could share in such profits through investment in ZeekRewards. Burks and his conspirators, including Zeek’s former Chief Operating Officer Dawn Wright Olivares and her step-son and Zeek’s Senior Technology Officer Daniel C. Olivares, claimed at one point that investors would be guaranteed a 125% return on their investment.
Burks and his conspirators represented that victim-investors in ZeekRewards could participate in the Retail Profit Pool (RPP), which supposedly allowed victims collectively to share 50% of Zeek’s daily net profits. Burks and his conspirators did not keep books and records needed to calculate such daily figures. Instead, Burks simply made up the daily “profit” numbers. Contrary to the conspirators’ claims, the true revenue from the scheme did not come from the penny auction’s “massive profits.” Instead, approximately 98% of all incoming funds came from victim-investors, which were then used to make Ponzi-style payments to earlier victim investors.
In addition to promising massive returns on investments, Burks and his conspirators used a number of ways to promote Zeek to current and potential investors. For example, the conspirators hosted weekly conference calls and leadership calls, where participants could call in listen to Burks and others make false representations intended to encourage victim-investors to continue to invest money and to recruit others to invest in Zeek. Burks also organized and attended “Red Carpet Events,” where victim investors came to hear details of the scheme in person. During these events, Burks and his conspirators made false representations about the massive retail profits generated by Zeek. They also used electronic and print media, including websites, emails and journals, to make false and misleading statements about the success of Zeekler to recruit victim investors.
As the Ponzi scheme grew in size and scope it became unsustainable and it eventually began to unravel as the outstanding liability resulting from the bogus 125% return on investment continued to rise beyond control. By August 2012, Burks and his conspirators fraudulently represented to the collective victims that their investments were worth nearly $3 billion, but had no accurate books and records to even determine how much cash on hand was available to pay such liability. Contrary to representations made to victim investors, at that time, Burks and his conspirators had only $340 million available to pay out investors. Over the course of the scheme, Burks diverted approximately $10.1 million to himself.
Burks also failed to file corporate tax returns or to make corporate tax payments for his companies, among other things. In addition, for tax year 2011, Burks issued fraudulent IRS Forms 1099s, causing victim-investors to file inaccurate tax returns for phantom income they never actually received.
Burks will remain free on bond. A sentencing date for the defendant has not been set yet. The wire and mail fraud conspiracy charge, the mail fraud charge and wire fraud charge each carry a maximum prison term of 20 years and a $250,000 fine. The tax fraud conspiracy charge carries a maximum prison term of five years and a $250,000 fine.
Burks’ co-conspirators, Dawn Wright Olivares, Zeek’s Chief Operating Officer, and her step-son and Zeek’s Senior Technology Officer, Daniel C. Olivares, pleaded guilty in December 2013 to investment fraud conspiracy. Dawn Wright Olivares also pleaded guilty to tax fraud conspiracy. Both defendants currently await sentencing.
In making today’s announcement, U.S. Attorney Rose thanked the U.S. Secret Service and IRS-CI for investigating the case, and the U.S. Securities & Exchange Commission, Division of Enforcement for its assistance with the investigation.
The prosecution is handled by Assistant United States Attorneys Jenny Grus Sugar and Corey Ellis of the U.S. Attorney’s Office in Charlotte.
Additional information and updated court filings about this and related cases filings can be accessed at the district’s website: http://www.justice.gov/usao/ncw/ncwvwa.html.
South Carolina Man Sentenced to Prison for Federal Firearms ViolationRead the Press Release
CHARLOTTE, N.C. – Chief U.S. District Judge Frank D. Whitney sentenced yesterday a South Carolina to 53 months in prison on possession of a firearm by a felon charge, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Charles Traywick Randolph, 27, of Columbia, S.C, was also ordered to serve two years in supervised release after he is released from prison.
According to the filed court documents and statements made in court, on April 8, 2015, law enforcement responded to suspicious person call at the Baymont Inn, located in Charlotte. When law enforcement arrived, they made contact with Randolph, who was wearing a backpack on his back, and determined he had an outstanding arrest warrant. Law enforcement searched Randolph’s backpack and recovered a Zastava 7.62x39 caliber semiautomatic assault rifle and a high capacity magazine loaded with 30 rounds of hollow tip 7.62 ammunition. Randolph has a prior felony conviction and is prohibited from possessing a firearm.
The investigation was handled by the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and the Charlotte Mecklenburg Police Department. Assistant U.S. Attorney Robert Gleason prosecuted the case.
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In separate cases, three men were also sentenced yesterday on felon in possession of a firearm charges.
Roger Emanuel Reid, 39, of Charlotte, was sentenced to 51 months in prison and three years of supervised release. On January 14, 2015, law enforcement executed a search warrant at Reid’s residence. During the execution of the search warrant, Reid pointed a pistol at the first officer who entered the residence, but then immediately dropped the firearm and surrendered to law enforcement. Reid has a prior state drug conviction and is prohibited from possessing a firearm.
Thurman Armani Hill, 23, of Charlotte, was sentenced to 32 months in prison and two years of supervised release. On September 11, 2015, law enforcement conducted a traffic stop of the vehicle Hill was driving in connection with a drug trafficking investigation. During the traffic stop, law enforcement located a large bag of marijuana on the floorboard area of the front passenger seat of Hill’s vehicle. Law enforcement also seized from inside the vehicle a firearm, approximately 100 grams of marijuana, digital scales, 72 Xanax pills and $1,885 in cash. Hill’s prior conviction prohibits him from possessing a firearm.
Shamel Malik Dove, 22, of Charlotte, was sentenced to 23 months in prison and three of supervised release. According to court records, on August 12, 2015, law enforcement arrested Dove on outstanding warrants for a probation violation stemming from a robbery conviction. Over the course of the arrest, law enforcement seized a firearm, located between the driver’s seat and the center console of Dove’s vehicle. Dove’s prior conviction prohibits him from possessing a firearm.
In making today’s announcement, U.S. Attorney Rose thanked ATF and CMPD for handling the investigations. Assistant U.S. Attorney Taylor Phillips was in charge of Reid’s prosecution and Assistant U.S. Attorney Lambert Guinn prosecuted Hill and Dove’s cases.
Federal Grand Jury Indicts Cherokee Woman in International Parental Kidnapping CaseRead the Press Release
CHARLOTTE, N.C. – United States Attorney Jill Westmoreland Rose announced today that a federal grand jury sitting in Charlotte returned yesterday a criminal indictment against Shira Elizabeth Mattocks, aka Shira Elizabeth Raman, 27, of Cherokee, N.C., for kidnapping her three children and fleeing to Mexico. Mattocks was first charged by a criminal complaint filed in the Western District of North Carolina on June 20, 2016, and she was arrested the same month upon returning to the United States.
John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, and Chief James Dike Sneed of the Cherokee Indian Police Department join U.S. Attorney Rose in making today’s announcement.
According to allegations contained in the criminal complaint and the bill of indictment, Mattocks was involved in ongoing custody disputes with the fathers of her three young children, identified in court documents as E.A., J.O. and S.O.As alleged in court documents, sometime after November 14, 2014, Mattocks kidnapped E.A., J.O. and S.O., and fled the United States with the intent to obstruct the lawful exercise of the fathers’ parental rights.Law enforcement located Mattocks in Mexico and with the assistance and cooperation of the Mexican authorities Mattocks was deported back to the United States.On June 22, 2016, Mattocks was taken into custody upon her arrival at Hartfield-Jackson Atlanta International airport.
In making today’s announcement U.S. Attorney Rose said, “As alleged in the indictment, Mattocks abducted her three young children and fled to another country, where she hid for more than a year and a half.Rather than deal with pending custody issues, Mattocks chose to run, causing significant distress to the children’s fathers and potentially exposing the young victims to a great deal of psychological harm.Thanks to the diligent efforts of our law enforcement partners, the children have safely returned to the United States to resume a normal childhood and Mattocks will face the consequences of her actions.”
“The FBI is uniquely positioned to investigate cases involving charges related to international parental kidnapping. Through our Legal Attaché offices covering more than 200 countries, the FBI can work directly with other law enforcement agencies to bring justice to children whose parents try to take the law into their own hands,” said FBI’s Special Agent in Charge Strong.
Mattocks is currently in federal custody. Her arraignment has been scheduled for July 27, 2016, at 9:40 a.m. before U.S. Magistrate Judge Dennis Howell in Asheville. Mattocks is charged with three counts of international parental kidnapping. Each charge carries a maximum term of three years in prison.
The charges contained in the indictment are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
In making today’s announcement, U.S. Attorney Rose commended the FBI and the Cherokee Indian Police Department for their investigation of the case, and thanked LEGAT Mexico City, Guadalajara Sub-office, participating officers with the Instituto Nacional de Migración and La Policía Federal for their invaluable assistance.
Assistant U.S. Attorney John Pritchard of the U.S. Attorney’s Office in Asheville is prosecuting the case.
Charlotte Jury Delivers Guilty Verdicts Against Leader of Healthcare Fraud Scheme and Co-ConspiratorRead the Press Release
CHARLOTTE, N.C. – A federal jury in Charlotte has convicted the leader and co-conspirator of a health care fraud scheme that fraudulently billed Medicaid for more than $10 million in false claims, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Cynthia Teresa Harlan, 48, of Charlotte, and Claude Bernard McCrae, 38, of Hamlet, N.C., were convicted of one count of health care fraud conspiracy following a four-day trial. Co-defendant Tyree Craig Jones, 38, of Charlotte, pleaded guilty to one count of health care fraud conspiracy on the fourth day of trial. Harlan was also convicted of three counts of making false statements relating to heath care matters, three counts of aggravated identity theft, and one count of obstruction of a health care fraud investigation. Chief U.S. District Judge Frank D. Whitney presided over the trial.
John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division joins U.S. Attorney Rose in making today’s announcement.
According to evidence admitted at trial, witness testimony and other information contained in filed court documents:
Between October 2012 and August 2013, Harlan used a network of accomplices, including Jones and McCrae, to carry out an extensive health care fraud scheme involving the fraudulent submission of fake reimbursement claims to Medicaid for services that were never actually provided to beneficiaries. Harlan owned and operated Heartland Consulting and Marketing, Inc., a Charlotte-area company, purportedly specializing in the operation of mental health companies and Medicaid reimbursement. Harlan recruited a team of individuals that included mental health practitioners, note writers, patient recruiters, mental and behavioral health services providers and medical billers, and directed them to fabricate the necessary paperwork used to support the fraudulent claims billed to Medicaid. The fabricated paperwork included the names and beneficiary information of Medicaid recipients, fabricated intake packets, non-existent mental health diagnoses and made-up treatment plans and fake dates of service. It also included fake notes describing therapy services that never occurred. All of this information was organized in a manner to make it appear that the companies and clinicians involved in the scheme had provided legitimate therapy beneficiaries, contrary to the truth. The patient files were intended to deceive Medicaid auditors in case there was an inquiry about the accuracy of the fake claims.
Jones and McCrae were the co-owners of two outpatient mental and behavioral health services companies, Kings of Carolina Care 1, Inc. (Carolina Care 1), and Esteem Family Life Center, LLC (Esteem), both located in Rockingham, N.C. The two men partnered with Harlan and others to submit false reimbursement claims to Medicaid, claiming that the two entities provided mental and behavioral health services to the Medicaid recipients, when, in reality no services were provided at all. According to court records, Jones and McCrae, through Carolina Care 1, attempted to obtain from Medicaid over $5 million in fraudulent reimbursement claims and received over $1.3 million from Medicaid for the fraudulent claims.
Evidence at trial demonstrated that Harlan, Jones and McRae accomplished some of the fraud by misappropriating the Medicaid identification number of doctor. This doctor had never agreed to be part of Carolina Care 1, yet the group claimed that this doctor had provided over $2.3 million in therapy services to Medicaid recipients in just one year. Additionally, evidence presented at trial demonstrated that the false claims submitted by Carolina Care 1 indicated that Carolina Care 1 allegedly serviced over 500 clients in a single day.
Trial evidence also established that Harlan misused the names and Medicaid identification numbers of hundreds of Medicaid beneficiaries, including A.H., B.H. and M.H., in order to accomplish the scheme. According to the mothers of A.H. and M.H., who testified at trial, their children did not have mental health issues and never received any therapy services from any company. Harlan received over $400,000 for her role in the scheme. When Harlan became aware that she was being investigated for Medicaid fraud, Harlan directed some of her co-conspirators to destroy records as well as incriminating emails and text messages relevant to the scheme for the purpose of obstructing the investigation.
“Harlan and her extensive network of fraudsters and cheats repeatedly cheated North Carolina’s Medicaid program of money intended to pay for medical services of those in real need. The U.S. Attorney’s Office will continue to ferret out health care fraud and hold accountable those who cheat important government programs and steal taxpayers’ dollars,” said U.S. Attorney Rose.
“Medicaid fraud deprives much-needed services to poor and disabled North Carolinians and increases health care costs for everyone. The people trusted with the resources to care for others should not use that access to defraud the healthcare system. The FBI will work tirelessly to ensure federal funding is spent in an appropriate and legal manner,” said FBI’s Special Agent in Charge Strong.
To date, the following individuals have been prosecuted federally in connection with this health care fraud conspiracy:
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Aliya Boss was previously sentenced to 44 months in prison, three years supervised release and was ordered to pay $ 1,135,302.27 in restitution. Boss filed reimbursement claims to Medicaid fraudulently claiming that she had provided mental health and behavioral health services to beneficiaries.
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Alexander Bass and Torrey Darnell Moton were previously sentenced to 32 and 25 months in prison, respectively, three years of supervised release and were ordered to pay $370,372.37 as restitution.Bass and Moton owned United Rehabilitation Services (URS), in Erwin, N.C., and filed reimbursement claims to Medicaid fraudulently claiming that URS provided mental health and behavioral health services to beneficiaries.
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Sakeenah Davis and Kino Williams were previously sentenced to 42 and 35 months in prison, respectively, three years supervised release and were ordered to pay $ 506,124.00 in restition. Davis and Williams owned New Choices Youth and Family Services, in Charlotte, North Carolina, and filed reimbursement claims to Medicaid fraudulently claiming that URS provided mental health and behavioral health services to beneficiaries.
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Jacqueline Ford was previously sentenced to 21 months in prison and three years supervised release and was ordered to pay $442,679.92 restitution. Ford fabricated notes to support the false claims submitted by Carolina Care 1, URS and other companies.
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Zaria Humphries was previously sentenced to 24 months in prison and three years supervised release and was ordered to pay $222,037 in restitution. Humphries submitted false claims through her company Life Impact Solutions.
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Tanisha Melvin was sentenced to 33 months in prison, three years of supervised release and was ordered to pay $392,159.81 in restitution.Melvin was responsible for creating fake patient records for the conspiracy.
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LaChanda Clotiel Parks, also responsible for generating fake patient paperwork, was sentenced to 28 months in prison followed by three years of supervised release, and was ordered to pay $352,565.69 in restitution for her role in the conspiracy.
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Dr. Wanda Webb was sentenced two years probation and ordered to pay $79,338.74 in restitution. Webb also submitted fraudulent claims through her company, Cornerstone Counseling and Consulting.
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D’Marcus White, also responsible for generating fake patient paperwork, was previously sentenced to two years probation and ordered to pay $543,366.64 in restitution.
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Jason Adam Townsend is also facing health care fraud conspiracy and aggravated identity theft charges, for submitting fraudulent claims through his medical billing services company, Townhall Enterprises, LLC, located in Raeford, N.C.
McCrae is currently released on bond. Jones was remanded to federal custody on July 14, 2016, and Harlan remains in federal custody. A sentencing date for the defendants has not been set yet.
The health care fraud conspiracy charge carries a maximum prison term of 10 years. The maximum prison term for making false statements relating to health care matters is five years per count. The maximum penalty for obstruction of a health care fraud investigation offense carries a maximum prison term of five years and the aggravated identity theft charge carries a mandatory prison term of two years per count, consecutive to any other term of imprisonment.
The investigation was handled by the FBI with assistance from the North Carolina Medicaid Investigations Division. In making today’s announcement, U.S. Attorney Rose also thanked the Rockingham Police Department and the Richmond County Sheriff’s Office for their assistance at trial. The United States is being represented by Assistant U.S. Attorneys Kelli Ferry and Daniel Ryan, of the U.S. Attorney’s Office in Charlotte.
The investigation is the work of the Western District’s joint Health Care Fraud Task Force. The Task Force is multi-agency team of experienced federal and state investigators, working in conjunction with criminal and civil Assistant United States Attorneys, dedicated to identifying and prosecuting those who defraud the health care system, and reducing the potential for health care fraud in the future. The Task Force focuses on the coordination of cases, information sharing, identification of trends in health care fraud throughout the region, staffing of all whistle blower complaints, and the creation of investigative teams so that individual agencies may focus their unique areas of expertise on investigations. The Task Force builds upon existing partnerships between the agencies and its work reflects a heightened effort to reduce fraud and recover taxpayer dollars.
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]. To report Medicaid fraud in North Carolina, call the North Carolina Medicaid Investigations Division at 919-881-2320.
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Owner of Costa Rican Call Center and Two Others Plead Guilty to Defrauding Elderly through Offshore Sweepstakes SchemeRead the Press Release
Two U.S. citizens and a Canadian citizen have pleaded guilty for their roles in a $9 million “sweepstakes fraud” scheme to defraud hundreds of U.S. residents, many of them elderly, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Jill Westmoreland Rose of the Western District of North Carolina.
Jeffrey Robert Bonner, 37, of Sacramento, California; Cody Trevor Burgsteiner, 33, of Houston; and Darra Lee Shephard, 57, of Calgary, Alberta, pleaded guilty this week before U.S. Magistrate Judge David Keesler of the Western District of North Carolina to various counts of conspiracy to commit wire fraud and mail fraud, wire fraud, conspiracy to commit money laundering and international money laundering, all in connection with a Costa Rican telemarketing fraud scheme. Sentencing dates have not been set.
As part of their guilty pleas, Bonner, Burgsteiner and Shephard each admitted that from approximately 2007 through November 2012, they worked in a call center located in Costa Rica, which Bonner owned, where they placed telephone calls to U.S. residents, falsely informing them that they had won a substantial cash prize in a “sweepstakes.” The victims, many of whom were elderly, were told that in order to receive the prize, they had to pay for a purported “refundable insurance fee,” the defendants admitted. Bonner, Burgsteiner and Shephard admitted that once they received the money, they contacted the victims again to tell them that their prize amount had increased, due to either a clerical error or because other winners had been disqualified. The victims were then told to send additional money to pay for new purported fees, duties and insurance to receive the now larger sweepstakes prize, the defendants admitted. The defendants further admitted that they and their co-conspirators continued their attempts to collect additional money from the victims until an individual either ran out of money or discovered the fraudulent nature of the scheme. To mask that they were calling from Costa Rica, the conspirators utilized voice over internet protocol (VoIP) phones that displayed a 202 area code, giving the false impression that they were calling from Washington, D.C., they admitted. According to admissions made in connections with their pleas, the defendants and their co-conspirators often falsely claimed that they were calling on behalf of a U.S. federal agency to lure victims into a false sense of security.
Bonner, Burgsteiner, Shephard and their co-conspirators were responsible for causing approximately $9 million in losses to hundreds of U.S. citizens.
The U.S. Postal Inspection Service, FBI, Internal Revenue Service-Criminal Investigation, Federal Trade Commission and Department of Homeland Security investigated the case, and the Criminal Division’s Fraud Section supervised the investigation. Senior Litigation Counsel Patrick Donley and Trial Attorneys William Bowne and Gustav Eyler of the Fraud Section are prosecuting the case.
Charlotte Man Sentenced to More Than Eight Years in Prison on Possession of Child Pornography ChargesRead the Press Release
CHARLOTTE, N.C. B Brandon Daniel Enright, 29, of Charlotte, was sentenced today to 97 months in prison for possession of child pornography, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. U.S. District Judge Robert J. Conrad, Jr. presided over today’s hearing, and ordered Enright also to serve ten years of supervised release and to register as a sex offender.
John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division and Chief Kerr Putney of the Charlotte-Mecklenburg Police Department join U.S. Attorney Rose in making today’s announcement.
According to court documents and information introduced at the sentencing hearing, on or about October 20, 2013, Enright shared child pornography online with an undercover agent using a peer-2-peer network. During a subsequent search of Enright’s residence in Charlotte, law enforcement seized a computer and two external hard drives. Forensic analyses of those devices revealed that Enright possessed 251 videos of child pornography, depicting prepubescent minors engaging in sexual acts.
Enright pleaded guilty in September 2015 to one count of 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. All federal sentences are served without the possibility of parole.
U.S. Attorney Rose thanked the FBI and CMPD for their investigation of this case. Assistant U.S. Attorney Cortney Randall of the U.S. Attorney’s Office in Charlotte was in charge of the prosecution.
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
Armed Career Criminal Sentenced to 15 Years in Prison for Federal Firearms ViolationRead the Press Release
CHARLOTTE, N.C. – U.S. District Judge Robert J. Conrad, Jr. sentenced yesterday a Charlotte man to 15 years in prison for a federal firearms violation, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Jesmene Lockhart, 26, was also ordered to serve three years under supervised release after he is released from prison.
According to the filed court documents and statements made in court, on September 27, 2014, law enforcement officers responding to a 911 call approached Lockhart’s vehicle, which was parked near Marlow Avenue in Charlotte. The officers seized from the driver-side floorboard a pistol loaded with a 31 round magazine and one bullet in the chamber. Officers also recovered from the pocket of the driver’s side door a fully loaded 10 capacity magazine. Court records show that Lockhart has a prior offense and is prohibited from possessing a handgun. He pleaded guilty in July 2015 to one count of possession of a firearm by a convicted felon. Court records indicate that Lockhart was convicted in 2006 of conspiracy to commit armed robbery and robbery with a dangerous weapon and at sentencing he qualified as an armed career criminal.
The investigation was handled by the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and the Charlotte Mecklenburg Police Department. Assistant U.S. Attorney Jennifer Dillon prosecuted the case.
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In two separate cases, Judge Conrad also sentenced two Charlotte men on federal gun charges. Laquan Marcell Wilson, 37, and Michael Lamar Perry, 29, were sentenced to 84 months and 46 months in prison and three years of supervised release, respectively. They each pleaded guilty to one count of possession of a firearm by a convicted felon. Perry also pleaded guilty to one count of possession with intent to distribute marijuana.
According to court documents and court proceedings, on June 23, 2014, CMPD officers arrived at an apartment complex located at the intersection of Milton Road and Barrington Drive, in Charlotte. The officers approached Wilson, who was standing with a group of people in an area that is recognized by law enforcement as an open air drug market. According to court records, officers recovered from Wilson a handgun, which was tucked into his waistband, and illegal substances, including crack cocaine and marijuana cigarettes. Court records show that Wilson has a prior offense and is prohibited from possessing a handgun.
Court documents filed in Perry’s case show that on September 11, 2013, CMPD officers arrived at a residence located on Lexington Circle, in Charlotte, in response to complaint regarding drug activity. As the officers approached the residence, they observed Perry through the open front door, reaching into a kitchen cabinet that contained what appeared to be marijuana. Officers entered the residence and while executing a search warrant they seized drugs, over $10,000 in cash and a revolver and ammunition which belonged to Perry. Court records show that Perry has a prior felony conviction and is prohibited from possessing a firearm.
At sentencing, both Wilson and Perry received sentencing enhancements for possession of a firearm in connection with another felony offense.
ATF and CMPD handled Wilson’s investigation. The Drug Enforcement Administration (DEA) and CMPD investigated Perry’s case. Assistant U.S. Attorney William Miller prosecuted both cases.
North Dakota Man Sentenced to Three Years for Traveling with A Stolen Passport and Aggravated Identity Theft ChargesRead the Press Release
CHARLOTTE, N.C. –William Albert Ulmer, aka “Bill Ulmer,” 49, of West Dickinson, North Dakota, was sentenced today to three years in prison for traveling with a stolen passport and aggravated identity theft charges, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. U.S. District Judge Robert J. Conrad, Jr. also sentenced Ulmer to three years of supervised release after he is released from prison.
Thomas Haycraft, Acting Special Agent in Charge of the Washington Field Office, Diplomatic Security Service, U.S. Department of State, joins U.S. Attorney Rose in making todays’ announcement.
According to filed court documents and today’s sentencing hearing, from about March 2009 to about December 23, 2010, Ulmer stole and used his brother’s passport, Wayne Jacob Ulmer, Jr. to travel between the United States and Costa Rica. Court records show that Ulmer used his brother’s passport to fly from Norfolk, Virginia, to San Jose, Costa Rica on March 11, 2009, where he resided for approximately 21 months. According to court records, at the time Ulmer used his brother’s passport to fly to Costa Rica, he was facing state charges in North Carolina related to a worthless check scheme. Court records show that Ulmer flew out of the United States in March 2009, failing to appear to a court hearing related to the pending state charges, scheduled for April 15, 2009, in Dare County Criminal Superior Court.
Ulmer used his brother’s passport again for his return trip to the United States. According to court records, Ulmer left Costa Rica in December 2010, around the time Costa Rican authorities began to investigate the disappearance of Ms. Barbara Strunkova, Ulmer’s live-in girlfriend at the time. According to court records, Ulmer landed at Charlotte Douglas International Airport on December 23, 2010, and presented his brother’s stolen passport to U.S. Customs officials, entering the United States under his brother’s name. After clearing U.S. Customs, Ulmer then used the stolen passport again to continue his air travel to his final destination in Norfolk, Virginia.
Ulmer pleaded guilty in September 2015 to one count of possession of identification document with intent to defraud and one count of aggravated identity theft. Ulmer is currently in federal custody and will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility. All federal sentences are served without the possibility of parole.
In making today’s announcement U.S. Attorney Rose thanked the U.S. Department of State’s Diplomatic Security Service for handling the investigation and the Kill Devil Hills Police Department for their assistance with this case.
Assistant U.S. Attorney Thomas O’Malley, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.
Former Macon Co. Board of Elections Director Sentenced to Prison for Embezzling Public FundsRead the Press Release
ASHEVILLE, N.C. – Kimberly Michelle Bishop, the former director of Macon County’s Board of Elections was sentenced late yesterday to six months in prison for embezzling public funds, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Bishop, 44, of Franklin, N.C., was also ordered to serve three years of supervised release, the first six months of which to be served under home detention, and to pay $68,705.26 as restitution.
U.S. Attorney Rose is joined by John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, and Tom Ammons, Assistant Special Agent in Charge of the North Carolina State Bureau of Investigation (SBI) in making today’s announcement.
“Bishop abused the trust placed in her by the public. As a director on the Board of Elections, Bishop stole public money to enrich herself and her lifestyle. She is now a federally convicted felon, a title she earned through her greed and theft. Federal laws are very effective in addressing this type of corruption - let this be a message to other elected officials who may seek to violate the public’s trust through illegal activity,” said U.S. Attorney Rose.
“This was a complex investigation that took teamwork, from both the SBI and FBI, to accomplish a positive outcome. We have built a strong relationship with the FBI, and enjoy the partnership developed with investigating public corruption cases. Our goal for this investigation was to ensure that justice was served so the community knew this type of behavior by a leader within the county would not be tolerated,” said Assistant Special Agent in Charge Ammons.
According to information contained in filed plea documents and the sentencing hearing, from about 2002 to January 2014, Bishop served as director of the Board of Elections (BOE) for Macon County. In that capacity, Bishop had access to BOE’s expense budget and was authorized to initiate check requests to pay for BOE-related services. Beginning in about June 2013 and continuing through January 2014, court records show that Bishop submitted check request forms and caused checks to be issued to four individuals to supposedly pay for their work on behalf of BOE. BOE had not, in fact, approved these four individuals as BOE workers and they were not on the county’s payroll.
Bishop has admitted in court that in order to cash these checks, on some occasions she forged the endorsement signature of the payee and signed her own name on the back of the checks, then cashed them at local financial institutions. On other occasions, court records show that two of the named payees would sign their names as endorsers, cash the checks and split the money with the defendant. In total, Bishop’s embezzlement scheme caused Macon County to issue checks for over $68,000. Bishop pleaded guilty in February 2016 to one count of federal program fraud.
In making today’s announcement U.S. Attorney Rose thanked the FBI and the SBI for their investigation of this case which is ongoing. The prosecution was handled by Assistant United States Attorney Richard Edwards of the U.S. Attorney’s Office in Asheville.
Former Operator of Two Macon Co. Companies Sentenced to More Than 11 Years in Prison on Securities Fraud and Money Laundering ChargesRead the Press Release
ASHEVILLE, N.C. – U.S. District Judge Martin Reidinger sentenced today the former operator of two companies located in Franklin, N.C. to 135 months in prison on federal securities fraud and money laundering charges, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Barry Carlton Taylor, 64, of Franklin, was also ordered to serve three years of supervised release and to pay nearly $2.2 million as restitution to his victim investors.
U.S. Attorney Rose is joined by John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, in making today’s announcement.
“Taylor was a con artist who used lies and deception to convince his victims to hand over their hard-earned money. Contrary to his lofty promises of huge profits, Taylor’s investors – some of whom were elderly – sustained grave financial losses and may never be able to recover financially after falling prey to this scammer’s investment scheme,” said U.S. Attorney Rose.
According to filed court documents and today’s sentencing hearing, Taylor operated two limited liability companies in Franklin, N.C., “OTC Investments, LLC” (OTC) and “Forex Currency Trade Advisors, LLC” (FCTA). Beginning in August 2011, Taylor induced 18 victims to invest approximately $2.5 million by falsely telling them he was an expert in the foreign currency exchange market (FOREX) and that their investments would be pooled into trading accounts which he would manage and use to invest in FOREX. Court records show that Taylor also falsely told his victims that he had created a computer software system that could track the FOREX market, which enabled him to make investments that generated very high rates of return, as much as 2.5% per month.
According to court records, even though Taylor opened and maintained FOREX trading accounts in the names of his two companies neither company was registered as a commodity pool operator. Court records also show that Taylor deposited the funds he solicited from the individual victim investors into these trading accounts, but he then withdrew more than half of the victims’ money and lost the rest due to trading losses, fees and commissions. According to court records, by April 2015 there was very little or no investor funds remaining in the trading accounts controlled by Taylor.
Taylor concealed the losses by sending the victims false monthly statements, which represented that the investors’ principal was intact and that they were realizing profits as promised. Court records indicate that Taylor used money from other principal investors to make Ponzi-style payments to investors who had asked Taylor to withdraw their profits on their promised returns. Taylor also convinced some of the investors to reinvest their “commissions” rather than accepting payments, court documents show.
In furtherance of the fraudulent scheme, filed documents indicate that Taylor used a number of lies to further induce investors and to conceal the fraud. For example, in January 2015, Taylor sent his victims fraudulent emails claiming that he had halted FOREX trading due to events involving the Swiss National bank. In another example, court records show that Taylor created a fictitious entity and a fictitious person in order to send lulling emails to calm his investors, and later lied to victims telling them he was considering taking legal action against this fictitious individual who was supposedly responsible for their trading losses.
Contrary to promises made to his victim investors, Taylor diverted over half a million dollars of the victims’ investment funds and used the money to cover personal expenses, such as restaurants, entertainment and shopping, among others. Taylor pleaded guilty in January 2016 to fraud by commodities pool operator and concealment of money laundering charges.
In announcing today’s sentence, Judge Reidinger said that the losses to the individual victims were great, many of whom were deprived of the security of their retirements.
Taylor will be ordered to report to the Federal Bureau of Prisons to begin serving his sentence upon designation of a federal facility. All federal sentences are served without the possibility of parole.
The FBI investigated the case. In making this announcement, U.S. Attorney Rose also thanked the U.S. Commodities Futures Trading Commission for their invaluable assistance in this investigation. Assistant United States Attorney Don Gast of the U.S. Attorney’s Office in Asheville was in charge of the prosecution.
U.S. Attorney's Office Files Federal Charges Against 16 Individuals for Fraudulent Receipt of Travel Reimbursement Benefits from U.S. Department of Veterans AffairsRead the Press Release
ASHEVILLE, N.C. – U.S. Attorney Jill Westmoreland Rose announced today that in the month of June the U.S. Attorney’s Office in Asheville has filed federal charges against 16 individuals that defrauded the U.S. Department of Veterans Affairs (the VA) by submitting fraudulent travel vouchers for reimbursement.
Kim Lampkins, Special Agent in Charge of the Mid-Atlantic Field Office, Washington, D.C., of the U.S. Department of Veterans Affairs, Office of Inspector General (VA-OIG), joins U.S. Attorney Rose in making today’s announcement.
According to allegations contained in filed court documents, the Charles George Veterans Affairs Medical Center (VAMC), located in Asheville, is operated by the VA and provides services for veterans of the United States military. Under certain circumstances, veterans with service-connected disabilities are reimbursed for travel expenses on mileage they incur when traveling to and from their residence and the VAMC. In order to claim mileage reimbursement, eligible veterans must go to the Travel Benefits Office at the VAMC and provide information about the distance traveled. The veterans then obtain a voucher which they submit to the Agent Cashier to receive reimbursement for their travel.
The charging documents allege that the defendants submitted fraudulent travel vouchers that overstated the distance they traveled for medical appointments or to receive medical treatment. The VA reimbursed the defendants for their travel expenses based on mileage information on the fraudulent vouchers. A total of 16 individuals have been charged separately in connection with travel voucher fraud.
A federal grand jury returned federal indictments on June 7, 2016, against three individuals, charging each defendant separately with one count of making a false claim for travel benefits from the VA, for allegedly submitting multiple fraudulent travel vouchers over a period of months or years. The charge levies a maximum penalty of five years in prison and a $250,000 fine. The three indicted are:
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Arlan M. Land, 53, of Nolanville, TX, was indicted for allegedly obtaining from the VA approximately $18,839.10 in fraudulent claims.(Docket no. 1:16-cr-72)
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David B. Wright, 56, of Asheville, is facing federal charges for allegedly obtaining approximately $15,391.52 from the VA. (Docket no. 1:16-cr-73)
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Pamela L. Smith, 55, of Asheville, has been indicted for allegedly defrauding the VA of approximately $5,318.96. (Docket no. 1:16-cr-71)
Criminal bills of information have also been filed against 13 defendants. They are each charged with one count of stealing money from the VA, a charge that levies a potential maximum prison term of one year and a $100,000 fine. The loss amount associated with each case is less than $5,000. Those charged are:
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Harris Hamilton, 60, of Chesnee, S.C., is charged for allegedly obtaining from the VA approximately $2,662 in fraudulent claims. (Docket no. 1:16-mj-72)
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Marcus McEachin, 45, of Asheville, is charged for allegedly obtaining from the VA approximately $4,029 in fraudulent claims. (Docket no. 1:16-mj-73)
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Michael Tate, 55, of Asheville, is charged for allegedly obtaining from the VA approximately $2,919 in fraudulent claims. (Docket no. 1:16-mj-74)
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Christopher Miller, 52, of Spartanburg, S.C., is charged for allegedly obtaining from the VA approximately $3,411 in fraudulent claims. (Docket no. 1:16-mj-75)
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Tommie Borders, 62, of Asheville, is charged for allegedly obtaining from the VA approximately $1,426 in fraudulent claims. (Docket no. 1:16-mj-76)
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Ruben Dixon, 59, of Lenoir, N.C., is charged for allegedly obtaining from the VA approximately $1,234 in fraudulent claims. (Docket no. 1:16-mj-77)
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Jeffrey Franklin, 58, of Asheville, is charged for allegedly obtaining from the VA approximately $3,486 in fraudulent claims. (Docket no. 1:16-mj-78)
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Violet McKinney, 53, of Asheville, is charged for allegedly obtaining from the VA approximately $4,737 in fraudulent claims. (Docket no. 1:16-mj-79)
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Guy Stivender, 57, of Asheville, is charged for allegedly obtaining from the VA approximately $1,534 in fraudulent claims. (Docket no. 1:16-mj-80)
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TC Littlejohn, 56, of Asheville, is charged for allegedly obtaining from the VA approximately $1,514 in fraudulent claims. (Docket no. 1:16-mj-83)
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Kevin Simms of Asheville, is charged for allegedly obtaining from the VA approximately $ 4,348 in fraudulent claims. (Docket no. 1:16-mj-84)
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Marshall Dukes, 61, of Asheville, is charged for allegedly obtaining from the VA approximately $3,780 in fraudulent claims. (Docket no. 1:16-mj-85)
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Kenneth Pickens, 47, of Asheville, is charged for allegedly obtaining from the VA approximately $2,480 in fraudulent claims. (Docket no. 1:16-mj-86)
“The travel reimbursement program exists to ease the financial burden on military veterans seeking medical treatment and access to good medical care. The system relies upon veterans to submit honest and accurate forms, reflecting actual travel expenses. Unfortunately, these 16 individuals allegedly decided to lie and make some extra cash by padding their travel vouchers. We simply cannot allow this type of fraud, waste and abuse to go on and we will prosecute anyone who steals money from a program put in place to provide much-needed assistance to our country’s veterans,” said U.S. Attorney Rose.
The charges contained in the charging documents are allegations. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
In making today’s announcement U.S. Attorney Rose thanked the VA-OIG and the Veterans Affairs Police Department for their investigation of the cases. Assistant U.S. Attorney Richard Edwards of the U.S. Attorney’s Office in Asheville is in charge of the prosecution.
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Last Member of Mortgage Fraud Conspiracy Involving Luxury Condominiums Is Handed Down A 27 Month SentenceRead the Press Release
CHARLOTTE, N.C. – Late yesterday, Chief U.S. District Judge Frank D. Whitney sentenced the last member of a mortgage fraud conspiracy involving luxury condominiums in Oak Island, N.C., announced Jill Westmoreland Rose, 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 and Miriam Baer, Executive Director of the North Carolina Real Estate Commission join U.S. Attorney Rose in making today’s announcement.
According to filed court documents and today’s sentencing hearing, throughout 2007 and 2008, Antoine Johnson, 40, of Davidson, N.C., and seven other co-conspirators carried out a mortgage fraud scheme involving luxury condominiums in Oak Island. According to court records, Johnson, who operated as a promoter for the mortgage fraud conspiracy, controlled A&J Entertainment, Inc. (A&J Entertainment), a company used by the conspiracy to funnel kickbacks derived from the fraudulent scheme and to support false or inflated statements of employment and income in mortgage loan applications.
Court documents show that the co-conspirators perpetrated the scheme by recruiting individuals who agreed to buy condominiums in their name but had no intention of living in the properties or making payments to the corresponding mortgage loans (commonly referred to as “straw buyers”). The builder agreed to sell the units to the conspiracy’s straw buyers at an inflated price, causing the lenders to issue mortgage loans based on the inflated prices. Then at closing, the closing attorney prepared separate accounting statements instructing the builder to pay the difference between the true price and the inflated price of the condominiums to one or more of the conspirators.
According to court records, the conspirators induced mortgage lenders to issue mortgage loans, by submitting loan packages that contained forged documents and fraudulent information about the buyers’ income and employment. In some instances, the co-conspirators persuaded and bribed a bank employee to provide a bogus verification of deposit as support for the fraudulently obtained loan. Over the course of the fraudulent scheme, the conspirators caused a total of loss of approximately $4.5 million involving approximately 20 properties.
Court records indicate that Johnson operated as promoter in the scheme, helping to bring the transactions together, for which he received approximately $200,000 in kickbacks funneled through A&J Entertainment’s bank account.
The other seven defendants involved in this fraudulent scheme were previously sentenced as follows:
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Robert Davis, Jr., 41, of Charlotte, was sentenced to 46 months in prison and two years of supervised release.Davis operated as a real estate agent for the scheme.
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Robert Mahaney, Jr., 55, of Ridgeway, S.C., was sentenced to 30 months in prison and two years of supervised release.Mahaney was a mortgage broker for the conspiracy.
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Ahmed H. Green, 37, of Charlotte, was sentenced to 27 months in prison and three years of supervised release.Green acted as a promoter and sometimes as a straw buyer for the conspiracy.
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Carisa L. Majesky, 49, of Charlotte, was sentenced to 24 months in prison followed by two years of supervised release.Majesky operated as a real estate agent for the scheme.
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Somer Bey, 51, of Charlotte, was sentenced to 17 months in prison followed by one year of supervised release.Bey was a real estate agent for the scheme.
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Eric Marlon Davis, 43, of Charlotte, was sentenced to nine months in prison and one year of supervised release, nine months of which in home detention. Davis was a promoter in the scheme.
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Danielle Anderson, 41, of Charlotte, was sentenced to six months in prison and one year of supervised release six months of which in home confinement. Anderson was a bank employee who participated in the scheme.
Johnson will be ordered to report to the Federal Bureau of Prisons upon designation of a federal facility. All federal agencies are served without the possibility of parole.
In making today’s announcement, U.S. Attorney Rose thanked the FBI and the North Carolina Real Estate Commission for their investigation of this case. Assistant United States Attorney Maria Vento prosecuted the case.
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Medical Device Company Agrees to Pay $8 Million to Resolve Claims It Paid Illegal Kickbacks to PhysiciansRead the Press Release
CHARLOTTE, N.C. – Minneapolis-based Cardiovascular Systems, Inc. (CSI), has agreed to pay $8 million to resolve allegations that it paid illegal kickbacks to induce physicians to use the company’s medical devices, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina.
Derrick L. Jackson, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General for the region including North Carolina joins U.S. Attorney Rose in making today’s announcement.
According to allegations contained in filed court documents, CSI executed a kickback scheme to induce the use of its medical devices by doctors. The government alleges that CSI violated the False Claims Act by providing marketing and other practice development services to physicians utilizing CSI’s devices to perform atherectomies. Atherectomy is a procedure that clears blockages restricting blood circulation in arteries. The government alleges that CSI developed and distributed marketing materials to promote physicians utilizing CSI’s devices to referring physicians; coordinated meetings between utilizing physicians and referring physicians; and developed and implemented business expansion plans for utilizing physicians. The government alleges that CSI engaged in these activities to induce doctors to begin to use or continue to use CSI’s devices.
“Doctors are expected to provide medical advice and treatment options that benefit patients, not their own practice,” said U.S. Attorney Rose. “A Company cannot reward physicians for using its medical devices over those of competitors. The type of kickback scheme alleged in this case compromises good medical care and can lead to inefficient use of limited healthcare resources. My office is committed to preventing medical device manufacturers from improperly influencing physicians’ medical judgment. We will thoroughly investigate any such allegations,” Rose added.
Today’s settlement resolves a civil complaint filed in July 2013 by whistleblower Travis Thams, a former employee of CSI. Mr Thams filed the allegations against CSI under the qui tam provisions of the False Claims Act, which permit private parties to file suit on behalf of the government and obtain a portion of the government’s recovery.
In addition to its settlement with the Justice Department, CSI has also entered into a Corporate Integrity Agreement with the U.S. Department of Health and Human Services - Office of Inspector General, requiring the company to engage in significant compliance efforts over the next five years, including engaging an independent review organization.
“Medical device companies engaging in kickbacks to boost profits undermine physicians’ medical judgment and drive up health care costs for everyone,” said Special Agent in Charge Jackson. “Our agency will continue to work with our law enforcement partners to investigate and recover Medicare money that was improperly paid.”
This settlement was the result of a coordinated effort by the U.S. Attorney=s Office Western District of North Carolina and HHS-OIG.
The lawsuit is captioned United States, ex rel. Thams v. Cardiovascular Systems, Inc. Case No. 3:13-cv-404. The claims resolved by this settlement are allegations only, and there has been no determination of liability.
Leader of Charlotte-Area Heroin Distribution Cell Is Sentence to 36 Years in PrisonRead the Press Release
CHARLOTTE, N.C. – Chief U.S. District Judge Frank D. Whitney sentenced late yesterday the leader of a Charlotte area heroin distribution cell to 432 months in prison, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Jose Ivan Hernandez, 34, of Mexico, was also ordered to serve five years of supervised release after he is released from prison.
Daniel R. Salter, Special Agent in Charge of the Atlanta Field Division of the Drug Enforcement Administration (DEA), which oversees the Charlotte District Office, Chief Kerr Putney of the Charlotte Mecklenburg Police Department, and Chief Rob Merchant of the Pineville Police Department join U.S. Attorney Rose in making today’s announcement.
According to filed court documents, evidence presented at the defendant’s trial and yesterday’s sentencing hearing, in or about 2013, Hernandez was managing a heroin distribution cell in Charlotte for a drug trafficking organization that imported heroin from Mexico into the United States. Court records show that Hernandez received the drugs in packages shipped from California via U.S. Postal Service and that he was responsible for the trafficking of least 10 kilograms of heroin.
According to trial evidence, as the head of the cell, Hernandez oversaw all aspects of the local drug operation, including the packaging of the heroin into balloons and its distribution, depositing drug proceeds into multiple funnel accounts and wiring the money to various places. As leader of the cell, Hernandez was also responsible for “collecting” on drug debts. For example, when Hernandez did not receive payment for a drug shipment fast enough, he sent the recipient of the heroin multiple threatening texts, warning that, “They are going to mess you up. They have people on the way and they’re going to go for you,” and that “They’re going to your house soon.”
In handing down the lengthy prison term, Judge Whitney said that Hernandez was at a senior point in the drug business, and described his drug trafficking activity as “extensive” and “crossing borders.” Judge Whitney also noted the need to specifically deter Hernandez from future crimes, given his threatening text messages, and the need for general deterrence.
In February 2016, a federal jury found Hernandez guilty of one count of conspiracy to distribute and to possess with intent to distribute heroin and one count of money laundering conspiracy. 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. All federal sentences are served without the possibility of parole.
DEA, CMPD and Pineville PD handled the investigation. Assistant U.S. Attorneys Elizabeth Greene, Kimlani Ford and Taylor Phillips of the U.S. Attorney’s Office in Charlotte prosecuted the case.
Citizen of the Czech Republic Is Sentenced to More Than 12 Years in Prison for Transporting, Receiving and Possessing Child Pornography While Visiting the United StatesRead the Press Release
CHARLOTTE, N.C. B Ales Svak, 43, and a citizen of the Czech Republic, was sentenced today to 151 months in prison for transportation, receipt and possession of child pornography he accessed while visiting the United States, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Chief U.S. District Judge Frank D. Whitney presided over today’s hearing, and ordered Svak also to serve a lifetime of supervised release and to register as a sex offender. Svak will also be subject to deportation proceedings upon completion of his federal sentence.
John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division joins U.S. Attorney Rose in making today’s announcement.
According to court documents and to information introduced at the sentencing hearing, Svak arrived in the United States in August 2014 on a 90-day visa, and was scheduled to return to the Czech Republic in November 2014. Court documents indicate that while visiting in the United States, Svak accessed child pornography online, and shared child pornography with an undercover FBI agent at least four times using a peer-2-peer network. During a subsequent search of Svak’s residence in Charlotte, law enforcement seized multiple electronic devices, including a laptop computer and two external hard drives. Forensic analyses of those devices revealed that Svak possessed 1,014 videos and 1,102 images of child pornography, some of which depicted prepubescent minors engaging in sadistic and masochistic or other violent conduct. Svak also admitted to engaging in a sexual act with a 15-year-old female on two occasions during a prior visit to the United States in 2003.
Svak pleaded guilty in March 2016 to one count of transportation, one count of receipt and one count of 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. All federal sentences are served without the possibility of parole.
U.S. Attorney Rose thanked the FBI for their investigation of this case. Assistant U.S. Attorney Cortney Randall of the U.S. Attorney’s Office in Charlotte was in charge of the prosecution.
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
South Carolina Man Sentenced to More Than 11 Years on Drug ChargesRead the Press Release
ASHEVILLE, N.C. –U.S. District Judge Martin Reidinger sentenced Cody Wayne Thomas, 25, of Cowpens, S.C., to 135 months in prison on federal drug charges, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Thomas was also ordered to serve five years under court supervision following his prison term.
According to filed court documents and today’s sentencing hearing, on October 20, 2015, an officer with the Cleveland County Sheriff’s Office observed Thomas’s vehicle parked in the parking lot of a convenience store. Court records show that the officer approached the vehicle and awakened Thomas who was asleep in the driver’s seat. According to court records, the officer observed an assault-style riffle located on the back seat of Thomas’s car, a second firearm in a cubby hole near the vehicle’s dashboard, and small bags containing a crystal substance later determined to be approximately eight ounces of methamphetamine. According to court records, Thomas was previously convicted of first degree burglary in South Carolina and is prohibited from possessing firearms. Thomas pleaded guilty in March 2016 to one count of possession with intent to distribute methamphetamine.
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In a separate case, Judge Reidinger also sentenced today Dallas Travolta McBride, 37, of Asheville, to 40 months in prison and three years of supervised release. According to court records, from on or about January 2015 to May 2015, McBride engaged in multiple drug sales of crack cocaine in the Asheville area. According to court records, when law enforcement arrested McBride, they recovered marijuana, $2,090 in cash, and a handgun hidden under the driver’s seat of McBride’s vehicle. In a separate incident, McBride was later arrested after being found in possession of another handgun. According to court records, McBride was previously convicted in North Carolina of attempted robbery with a dangerous weapon, second degree burglary, and assault with a deadly weapon inflicting serious bodily injury and is prohibited from possessing firearms. McBride pleaded guilty in December 2015 to one count of possession of a firearm by convicted felon.
In making today’s announcement, U.S. Attorney Rose thanked the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the Drug Enforcement Administration (DEA), and the Cleveland County Sheriff’s Office for handling Thomas’s investigation. Rose also thanked the FBI and the Asheville Police Department for their investigation into McBride.
Assistant United States Attorney John Pritchard of the U.S. Attorney’s Office in Asheville prosecuted both cases.
Methamphetamine Trafficker Is Sentenced to 10 Years in PrisonRead the Press Release
CHARLOTTE, N.C. – Chief U.S. District Judge Frank D. Whitney sentenced late yesterday Alberto Diaz-Fernandez, 55, of Santa Ana, California, to 121 months in prison and four years of supervised release on drug conspiracy charges, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina.
Daniel R. Salter, Special Agent in Charge of the Atlanta Field Division of the Drug Enforcement Administration (DEA), which oversees the Charlotte District Office and Chief Kerr Putney of the Charlotte Mecklenburg Police Department join U.S. Attorney Rose in making today’s announcement.
According to filed court documents and today’s sentencing hearing, on or about February 3, 2016, DEA agents of the Charlotte District Office Enforcement Group received information that a shipping pallet which had originated in Santa Ana and was carrying a Nissan V-6 engine, also contained methamphetamine and was destined for delivery to an automotive shop in the Charlotte area. According to court records, law enforcement located the shipment and executed a search warrant, seizing approximately five kilograms of methamphetamine hidden within an aftermarket compartment in the shipping pallet. On February 4, 2016, the day the shipment was scheduled for delivery, law enforcement approached Diaz-Fernandez who was waiting in front of the automotive shop. Diaz-Fernandez told law enforcement that he was expecting an engine he had shipped from California to be delivered on that date. Diaz-Fernandez later admitted to shipping the hidden drugs “for dangerous people in Mexico.”
In March 2016, Diaz-Fernandez pleaded guilty to one count of conspiracy to distribute and to possess 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. All federal sentences are served without the possibility of parole. The defendant will also be subject to deportation proceedings upon the completion of his federal sentence.
DEA and CMPD handled the investigation. Assistant U.S. Attorney Sanjeev Bhasker of the U.S. Attorney’s Office in Charlotte prosecuted the case.
Woman Caught Smuggling Cocaine at Charlotte Airport Pleads Guilty to Drug ChargesRead the Press Release
CHARLOTTE, N.C. – Shavona Danisha Pyatt, 28, of Conway, N.C., appeared in federal court today and pleaded guilty to one count of conspiracy to possess with intent to distribute cocaine, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. U.S. Magistrate Judge David Keesler presided over today’s plea hearing.
Nick Annan, Special Agent in Charge of ICE/Homeland Security Investigations (HSI) in Georgia and the Carolinas and Patti Fitzpatrick, Port Director of the U.S. Customs and Border Protection (CBP) Area in Charlotte join U.S. Attorney Rose in making today’s announcement.
According to filed plea documents and today’s hearing, on November 13, 2015, Pyatt arrived at Charlotte Douglas International Airport (Charlotte Douglas Airport) on a direct flight from Montego Bay, Jamaica. Upon entering the United States, Pyatt presented herself to CBP agents at primary inspection at the airport. Pyatt acknowledged packing her own luggage. At secondary inspection, CBP agents discovered that Pyatt was attempting to smuggle cocaine pellets hidden both in her luggage and pants. Court records indicate that CBP agents recovered additional cocaine pellets hidden in Pyatt’s body cavities. A total of 61 pellets containing between 400 grams to 500 grams of cocaine were recovered from Pyatt. Pyatt was interviewed by HSI agents and stated that she intended to deliver the cocaine to Myrtle Beach, S.C. in exchange for $12,000.
Pyatt was detained following the plea hearing. The charge levied against her carries a maximum prison term of 20 years and a $1,000,000 fine. A sentencing date has not been scheduled yet.
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In a separate case, Winston Sherif Richards, 40, of Jamaica, was sentenced today by Chief U.S. District Judge Frank D. Whitney to 30 months in prison, and one year of supervised release on federal drug conspiracy charges. According to court records, in October 2015, Richards was arrested when he attempted to smuggle cocaine through customs security at Charlotte Douglas Airport. Court records show that law enforcement found two bags of cocaine weighing approximately 822 grams, hidden within the lining of Richard’s backpack. Richards told law enforcement that he was hired by a man to bring some “stuff” to the United States and to deliver it to an unknown man in New York. Richards later admitted in court that he actively participated in the drug conspiracy. Richards pleaded guilty in March 2016 to one count of conspiracy to possess with intent to distribute cocaine.
In handing down Richards’ sentence, Judge Whitney said that this prison sentence will help deter future drug trafficking at the Charlotte airport. In addition to the prison term imposed, the court ordered Richards be deported upon completion of his sentence.
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In a third prosecution involving drug smuggling at the airport, Tamara Williams-Kelly, 37, of Jamaica has also pleaded guilty to federal drug charges. According to court records, in February 2016, Williams-Kelly flew into Charlotte Douglas Airport from Jamaica. At the airport, CBP agents recovered a total of 1.57 kilograms of packaged powder cocaine hidden in the defendant’s carry-on luggage and on her person. Court records show that Williams-Kelly told law enforcement she was promised $7,000 as payments for delivering the drugs to Norfolk, Virginia. Williams-Kelly pleaded guilty on April 29, 2016, to one count of conspiracy to distribute and to possess with intent to distribute cocaine, one count of possession with intent to distribute cocaine, one count of unlawful importation of cocaine conspiracy and one count of unlawful importation of cocaine. She is currently in federal custody awaiting sentencing.
All three cases are the result of HSI’s Airport Drug Interdiction initiative that targets international drug smuggling and financial crimes, including money laundering, bulk cash smuggling, and unlicensed money transmitters/transporters that utilize air travel to further their criminal enterprise. Through this initiative, HSI incorporates the collaborative efforts of multiple law enforcement agencies, to include CBP, North Carolina Department of Public Safety’s Divisions of Alcohol Law Enforcement (ALE) and Department of Correction (DOC), Charlotte-Mecklenburg Police Department, Pineville Police Department and Cornelius Police Department. In making today’s announcement U.S. Attorney Rose thanked these agencies for their joint investigation of these cases.
The prosecution for the government is being handled by Assistant U.S. Attorney Sanjeev Bhasker of the U.S. Attorney’s Office in Charlotte.
Charlotte Man Sentenced to 11 Years on Child Pornography ChargesRead the Press Release
CHARLOTTE, N.C. - A Charlotte man was sentenced today to 11 years in prison for possession and transportation of child pornography, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. In addition to the prison term imposed, Chief U.S. District Judge Frank D. Whitney ordered David Lee Young, II, 24, to serve a lifetime of supervised release and to register as a sex offender upon release from prison. Young pleaded guilty in March 2016 to three counts of transportation and one count of possession of child pornography.
Nick Annan, Special Agent in Charge of ICE/Homeland Security Investigations (HSI) in Georgia and the Carolinas and Chief Kerr Putney of the Charlotte Mecklenburg Police Department join U.S. Attorney Rose in making today’s announcement.
According to admissions made in connection with his guilty plea and to information introduced at sentencing, in October 2014, Young shared child pornography at least three times with an undercover agent over the Internet via a peer-2-peer network. During a subsequent search of Young’s residence, agents seized a desktop computer and a laptop. Forensic analyses of those devices revealed that Young possessed 29 videos of child pornography, some of which depicted prepubescent minors engaging in sadistic and masochistic conduct. Court records show that the child pornography in Young’s possession included at least 13 different children already identified by law enforcement as victims of child pornography.
Young is currently in custody and will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility. All federal sentences are served without the possibility of parole.
U.S. Attorney Rose thanked HSI and CMPD for their investigation of this case. Assistant U.S. Attorney Cortney Randall of the U.S. Attorney’s Office in Charlotte was in charge of the prosecution.
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