District of New Jersey
Press releases recorded for this federal judicial district.
Multimillion-Dollar Real Estate Ponzi Schemer Sentenced to Nine Years in Prison for Securities Fraud and Money LaunderingRead the Press Release
Perpetrator of Investment Scheme Also Ordered to Pay More Than $28.6 Million
NEWARK, N.J. – A Somerset County, N.J., man was sentenced today to 108 months in prison for his role in defrauding victims of an investment scheme by misusing their capital contributions and misrepresenting the performance of their investments, U.S. Attorney Paul J. Fishman announced.
David Connolly, 51, of Watchung, N.J., previously pleaded guilty before U.S. District Judge William J. Martini to two counts of a superseding indictment charging him with securities fraud and money laundering. In addition to the prison term, Judge Martini, who imposed the sentence today in Newark federal court, ordered Connolly to pay $18,732,775 in restitution and forfeit $9,920,000.
According to documents filed in this case and statements made in court:
From at least 2006 through October 2009, Connolly orchestrated a real estate investment fraud scheme in which he took in more than $50 million from more than 200 victims, causing losses of at least $18 million.
To induce victims to invest, Connolly made numerous materially false and misleading statements and omissions. He told victims their money would be used to purchase a specific property, and the property would generate rental income that would be used to pay investors monthly distributions. Connolly also told victims their money would be held in escrow until the closing of a purported real estate transaction and each property would be financially independent from all the others. Connolly misrepresented the amount of equity victims had in the properties, the condition of the properties, and the financial performance of the properties. Although the investment properties experienced significant negative cash flow, Connolly told investors they were performing well.
Connolly took significant portions of his victims’ money, which had been provided for specific real estate transactions, and used it for other purposes without victims’ knowledge. He funded unrelated real estate transactions in which he was engaged; paid prior victims; and paid himself. The scheme collapsed in the summer of 2009, after Connolly began defaulting on the mortgage payments for the investment properties.
In addition to the prison term, restitution and forfeiture, Judge Martini sentenced Connolly to serve three years of supervised release.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark, for the investigation. He also thanked special agents of IRS – Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen, for their important contributions to the investigation.
The government is represented by Assistant U.S. Attorney Charlton A. Rugg and Senior Litigation Counsel Leslie F. Schwartz of the U.S. Attorney’s Office Criminal Division in Newark.
If you believe you are a victim of or otherwise have information concerning this alleged scheme, you are encouraged to contact the FBI at 973-792-3000.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.stopfraud.gov.
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Defense counsel: Gerald M. Saluti Esq., Newark
Statement of New Jersey U.S. Attorney Paul J. Fishman on the Passing of Senator Frank LautenbergRead the Press Release
“Senator Lautenberg’s passion for public service and his commitment to making life better for everyone have inspired so many of us. From his service in WWII to his extraordinary tenure as our U.S. Senator, he exemplified everything that is great about this country. He was my friend, and I will miss him.”
New Jersey Collector, Distributor of Child Sex Abuse Images Sentenced to More Than 24 Years in Federal PrisonRead the Press Release
NEWARK, N.J. – A Lodi, N.J., man was sentenced today in Newark federal court to 292 months in prison for amassing and sharing an extensive photo and video collection of children being sexually abused, U.S. Attorney Paul J. Fishman announced.
Martin Villalobos, 41, of Lodi, N.J., previously was convicted by a federal jury on all counts of the superseding indictment on which he was tried: two counts of distribution of child pornography, two counts of receipt of child pornography and one count of possession of child pornography. The sentence was imposed by U.S. District Judge Stanley R. Chesler, who also presided over the trial. Villalobos has been in federal custody since his arrest.
According to documents filed in the case, evidence presented and statements made in court:
As part of an undercover investigation, special agents of the U.S. Department of Homeland Security’s Immigration and Customs Enforcement, Homeland Security Investigations (ICE HSI), discovered an individual who was sharing images of child sexual abuse over the Internet. Agents used the IP address of Villalobos’ computer to identify him.
After obtaining a court-ordered search warrant, agents found Villalobos in a locked bedroom with eight computer hard drives, more than 100 DVDs and other electronic media. A forensic analysis of the materials found revealed that he was in possession of 5,442 photographs and 164 videos of children, including prepubescent minors, nude and engaged in sexual acts with one another and with adults. The evidence at trial also proved that Villalobos routinely used the Internet to solicit, receive and distribute such images.
In sentencing Villalobos, Judge Chesler took into account his previous abuse of an unconscious woman with mental disabilities. During sentencing arguments, the government noted that footage of that abuse, which Villalobos recorded, was found in his home, along with writings describing the stalking and abduction of women to subject them to sexual torture; “crush videos,” depicting the killing of animals, such as rabbits and chicks; and multiple videos of bestiality.In addition to the prison term, Judge Chesler sentenced Villalobos to serve five years of supervised release and ordered him to pay $16,000 in restitution to victims who submitted claims. Villalobos will be required to register as a sex offender.
U.S. Attorney Fishman praised special agents of ICE HSI, under the direction of Special Agent in Charge Andrew M. McLees in Newark, for the investigation.
The government is represented by Assistant U.S. Attorneys Joseph B. Shumofsky and Nicholas P. Grippo of the U.S. Attorney’s Office Criminal Division in Newark.
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Defense counsel: pro se
Middlesex County, N.J., Lawyer Admits Scheme to Extort and Defraud Police Officers, Others Through Fake IRS InvestigationRead the Press Release
TRENTON, N.J. – A Middlesex County, N.J., lawyer and certified public accountant today admitted that he conspired with a New Jersey mortgage broker to extort and defraud victims by falsely representing to them that they were the subjects of criminal investigations, U.S. Attorney Paul J. Fishman announced.
Thomas G. Frey, 53, of Edison, N.J., pleaded guilty before U.S. District Judge Joel A. Pisano in Trenton federal court to two counts of an indictment charging him with conspiracy to commit extortion under fear of economic harm and to commit wire fraud.
According to documents filed in this case and statements made in court:
Frey, Robert G. Cusic Jr., a Millstone, N.J. mortgage broker, and another conspirator (named “CC-1” in the Indictment) schemed to defraud four victims, including two police officers, by falsely representing to them that they were the subjects of criminal investigations, principally by the IRS, in connection with investment properties that some of them owned. Frey and Cusic falsely represented that while Cusic was at a property formerly owned by one of the victims, Cusic encountered two IRS special agents (SA-1 and SA-2) who questioned him extensively about some of the victims.
Frey falsely told the victims he had ongoing communications with SA-1 about the purported investigation and had a special relationship with SA-1. Frey told the victims if they paid up to $20,000 each, he would call SA-1 and have the investigation converted from a criminal tax investigation to an IRS “desk audit,” a civil matter. Frey and CC-1 falsely stated that if the victims did not retain his services and pay the fee, the investigation would likely result in the arrest of certain of the victims.
The extortion and wire fraud conspiracy charges to which Frey pleaded guilty are each punishable by a maximum potential penalty of 20 years in prison and a fine of up to $250,000. Frey’s sentencing before Judge Pisano is scheduled for Sept. 5, 2013.
Frey was previously charged by Complaint on April 8, 2011, along with Cusic, with one count of conspiracy to commit extortion and one count of wire fraud. Cusic pleaded guilty Nov. 28, 2011, to conspiring with Frey to extort the victims. He is awaiting sentencing.
U.S. Attorney Fishman credited special agents of the Treasury Inspector General for Tax Administration, under the direction of Special Agent in Charge Robert Geary, Washington Field Division, for the investigation leading to the guilty plea.
The government is represented by Assistant U.S. Attorney Eric W. Moran of the U.S. Attorney’s Office Special Prosecutions Division in Trenton.13-224
Defense counsel: Charles E. Waldron Esq., Lawrenceville, N.J.
Frey, Thomas Indictment
Former Employee of Atlantic County, N.J., Timeshare Consulting Firm Admits Conspiring to Defraud Timeshare OwnersRead the Press Release
CAMDEN, N.J. – A former employee of The Vacation Ownership Group LLC of Pleasantville, N.J., admitted to conspiring to defraud owners of timeshare properties by offering phony consulting services, U.S. Attorney Paul J. Fishman announced.
Joseph Saxon, 39, of Brigantine, N.J., pleaded guilty today before U.S. District Court Judge Noel L. Hillman in Camden federal court to a superseding information charging him with one count of conspiracy to commit mail and wire fraud. Saxon was previously indicted on this charge.According to documents filed in this case and statements made in court:
The Vacation Ownership Group, a/k/a VO Group LLC, had offices in Mays Landing, N.J., and Egg Harbor Township, N.J., and claimed to offer to owners of timeshares consulting services that included cancelling, purchasing and upgrading the timeshares.
In 2010, Saxon started working at the VO Group and was trained by VO Group co-owner Adam Lacerda to call customers using prepared scripts. The defendant called customers and gave them the false impression that he was working for a bank or lending institution. After hearing Saxon’s false representations, some customers sent checks to the VO Group. For example, Saxon falsely told one victim that Saxon was working with the bank that held the victim’s timeshare mortgage and that the bank wanted to settle the loan for a fraction of the price. The victim then mailed a check for $5,925 to the VO Group. Saxon admitted causing more than $120,000 in losses.
On Jan. 23, 2013, co-owners Adam Lacerda, Ashley Lacerda and other members of the VO Group were charged in a superseding indictment with conspiracy to commit mail and wire fraud and other charges. Additional members of the VO Group were also charged by criminal complaint in April 2012. To date, 12 members of the VO Group have pleaded guilty to conspiring to commit mail fraud and wire fraud. As for the Lacerdas and other defendants who have not been convicted in this case, the charges and allegations against them are merely accusations and they are considered innocent unless and until proven guilty.
The mail and wire fraud conspiracy charge to which Saxon pleaded guilty is punishable by a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gain or loss caused by the offense. Sentencing is scheduled for Sept. 20, 2013.
U.S. Attorney Fishman credited special agents from the FBI’s Atlantic City Resident Agency, under the direction of Special Agent in Charge Aaron T. Ford in Newark; and special agents from the Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, under the direction of Special Agent in Charge Robert Panella, New York Region, for their roles in the investigation leading to the guilty pleas. He also thanked the N.J. Department of Labor, Benefit Payment Control Unit, for its assistance.
The government is represented by Assistant U.S. Attorneys Alyson M. Oswald and R. David Walk, Jr. of the U.S. Attorney’s Office Criminal Division in Camden.
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Defense counsel: David S. Rudenstein Esq., Philadelphia
Saxon, Joseph Superseding Information
Former Bank Officer Admits Accepting Bribes in Connection with Financial TransactionsRead the Press Release
CAMDEN, N.J. – A former bank officer today admitted his role in soliciting and accepting bribes in connection with financial transactions, U.S. Attorney Paul J. Fishman announced.
Jose Dominguez, 46, of Newark, N.J., pleaded guilty to an Information charging him with soliciting and accepting bribes as a bank officer in excess of $1,000. Dominguez solicited and accepted corrupt payments of $55,529, intending to be influenced and rewarded in connection with a bank transaction. He entered his guilty plea before U.S. District Judge Noel L. Hillman in Camden federal court.According to documents filed in this case and statements made in court:
From January 1988 to February 2007, Dominguez was employed as a loan officer at Spencer Savings Bank in Elmwood Park, New Jersey. In 2003, Dominguez was contacted by a bank customer because the customer wanted to refinance some loans with Spencer Savings Bank and wanted to do so without paying significant prepayment penalty fees. Dominguez advised the customer that if the customer made corrupt payments to Dominguez, as the loan officer, the customer could obtain a lower interest rate without paying a prepayment penalty to Spencer Savings Bank.
Between August 2003 and December 2003, Dominguez accepted $55,529.57 in corrupt payments from the customer to influence the requested loan modification. Dominguez also admitted to accepting additional bribes from other bank customers in the amounts of $4,500 and $5,000, respectively.
The bank bribery charge to which Dominguez pleaded guilty carries a maximum potential penalty of 30 years in prison and a $1 million fine. Dominguez also previously pleaded guilty on May 23, 2012, to conspiracy to commit bank fraud, bank fraud, and bank bribery as a Spencer Savings loan officer in connection with a separate case. Sentencing related to the charges from both cases is currently scheduled for Sept. 19, 2013.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark, with the investigation leading to the guilty pleas.
The government is represented by Assistant U.S. Attorneys Zahid N. Quraishi and Vikas Khanna of the U.S. Attorney’s Office Special Prosecutions Division in Newark.
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Defense counsel: Thomas Young Esq. Assistant Federal Public Defender, CamdenDominguez, Jose Information
Union County, N.J., Woman Who Drove Getaway Car During Bank Robbery Sentenced to 54 Months in PrisonRead the Press Release
NEWARK, N.J. – A Union County, N.J., woman who admitted serving as the getaway driver during the July 12, 2012, bank robbery of Unity Bank located at 1230 Bound Brook Road (Route 28) in Middlesex, N.J., was sentenced today to 54 months in prison, U.S. Attorney Paul J. Fishman announced.
Teresa Webb, 42, of Plainfield, N.J., previously pleaded guilty before U.S. District Court Kevin McNulty to an Information charging her with one count of bank robbery. Judge McNulty imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
On July 31, 2012, Claude Williams, 61, of Elizabeth, N.J., was charged by Complaint with six counts of bank robbery and two counts of using a firearm in furtherance of a crime of violence. In the course of those robberies, Williams would generally send an accomplice into the bank to case it shortly before he entered to commit the robbery.
Before the July 12, 2012, robbery, Webb entered the Unity Bank twice without doing any banking. A short while later, an unarmed, off-duty police officer allegedly observed Williams leave the bank, get into the rear of the getaway car, and crouch down. After noting the license plate number, the officer followed the car. Webb, who was driving the getaway car, attempted to elude the officer.
After Webb’s unsuccessful attempt to elude the officer, Williams got out of the car and pointed his gun at the officer, forcing her to leave the scene without apprehending Williams and Webb.
In addition to the prison term, Judge McNulty sentenced Webb to five years of supervised release. The charges against Williams are pending.U.S. Attorney Fishman credited special agents with the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark with the investigation leading to the arrest. He also thanked the Somerset County Prosecutors Office and the Middlesex Borough, Piscataway, Clifton, Metuchen, North Plainfield, and Plainfield police departments for their work in this case.
The government is represented by Assistant U.S. Attorney Osmar J. Benvenuto of the U.S. Attorney’s Office General Crimes Unit in Newark.
Defense counsel: Bruce S. Rosen Esq., Toms River, N.J.
13-221New City, N.Y., Man Sentenced to 37 Months in Prison for Possessing Images of Child Sexual AbuseRead the Press Release
NEWARK, N.J. -- A New City, N.Y., man and former employee of a New Jersey country club was sentenced today to 37 months in prison for possessing images on his computer of children being sexually abused, U.S. Attorney Paul J. Fishman announced.
John C. Zerega, 55, previously pleaded guilty before U.S. District Judge Kevin McNulty to a one-count Information charging him with possession of child pornography. Judge McNulty imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:As early as Oct. 19, 2011, Zerega downloaded videos and images of child pornography on the Internet via peer-to-peer file sharing software. On Dec. 20, 2011, law enforcement officials executed a search warrant at Zerega’s residence and seized his laptop computer, which contained numerous pictures and videos depicting child pornography, including pictures of prepubescent children engaging in sexual activity and being sexually abused.
In addition to the prison term, Judge McNulty sentenced Zerega to 10 years of supervised release and required him to get mental health testing and treatment. Zerega also must register as a sex offender.
U.S. Attorney Fishman credited special agents of the FBI Newark Division’s Cyber Task Force, under the direction of Special Agent in Charge Aaron T. Ford in Newark, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney Vikas Khanna of the U.S. Attorney=s Office Special Prosecutions Division.
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Defense counsel: Deborah Loewenberg Esq., New City, N.Y., and Paul Brickfield Esq., River Edge, N.J.
Essex County, N.J., Man Charged in Armed Robbery of StoreRead the Press Release
NEWARK, N.J. – Special agents of the FBI arrested an Essex County, N.J., man this morning in connection with the armed robbery of Belleville News and Food, U.S. Attorney Paul J. Fishman announced.
Bobby Dawson, 43, of East Orange, N.J., is charged by Complaint with one count of committing a Hobbs Act robbery and one count of brandishing a firearm during a crime of violence. He is scheduled to appear this afternoon before U.S. Magistrate Judge Madeline Cox Arleo in Newark.
According to the criminal Complaint unsealed today:
On April 17, 2013, Dawson, wearing a mask and brandishing a firearm, allegedly entered the Belleville News and Food store. He told the store clerk not to move or he would shoot. Dawson pointed his firearm at the store clerk’s head and demanded money from the cash registers. The store clerk complied and gave Dawson the money.
The Hobbs Act robbery charge is punishable by a maximum potential penalty of 20 years in prison. The weapons charge is punishable by a maximum potential penalty of life in prison and a mandatory minimum sentence of seven years in prison, which must run consecutively to any other prison term. Each count also carries a maximum fine of $250,000 or twice the gross gain or loss.U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark, with the investigation leading to today’s arrest. He also thanked the Belleville, Bloomfield, Kearny, Maplewood, Newark, Paramus, and Verona police departments, along with the N.J. State Police and the Essex County Prosecutor’s Office for their assistance.
The government is represented by Assistant U.S. Attorneys Jamari Buxton and Rahul Agarwal of the U.S. Attorney’s Office General Crimes Unit in Newark.
The charge and allegations contained in the Complaint are merely accusations, and the defendant is considered innocent unless and until proven guilty.
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Defense Counsel: Candace Hom Esq., Assistant Federal Public Defender, Newark
Dawson, Bobby Complaint
Seven People Charged in $2 Million Tax Refund Check ScamRead the Press Release
NEWARK, N.J. – Seven people allegedly involved in an extensive scheme to obtain millions of dollars through fraudulently obtained refund checks issued by the U.S. Treasury were charged today with conspiring to steal government funds, U.S. Attorney Paul J. Fishman announced.
Fausto Bernard, 48, of Newark, N.J., was arrested this morning by special agents of IRS-Criminal Investigation, postal inspectors from the U.S. Postal Inspection Service, and special agents of the U.S. Secret Service. Gloria Rivera, 39, of Bronx, N.Y.; and Lourdes Ortiz, 40, of Ridgewood, N.Y. surrendered to special agents of the USPS-OIG. Luis Pena, 43, of Yonkers, N.Y., was arrested Tuesday night by special agents of the U.S. Postal Service, Office of the Inspector General. They will make their initial appearances before U.S. Magistrate Judge Madeline Cox Arleo this afternoon.
Defendant Raymundo Hernandez, 34, of Bronx, N.Y., is incarcerated in the Southern District of New York on other charges and is scheduled to make his initial court appearance on Friday.
Defendants Wellington Feliz, 30, of Bronx, N.Y., and Isaias Hernandez, 38, of Bronx, N.Y., remain at large. All seven defendants are charged by criminal Complaint with one count of conspiring to steal U.S. Treasury checks.
According to the criminal Complaint unsealed today:
Background on Stolen Identity Refund Fraud
Stolen Identity Refund Fraud (SIRF) is a common type of fraud committed against the United States government that results in more than $2 billion a year in losses to the treasury. SIRF schemes generally share a number of hallmarks:
- SIRF perpetrators obtain personal identifying information, including Social Security numbers and dates of birth, from unwitting individuals, who often reside in the Commonwealth of Puerto Rico.
- SIRF participants complete 1040 tax return forms using the fraudulently-obtained information and falsifying wages earned, taxes withheld and other data, always ensuring that fraudulent tax return generates a refund.
- They direct the U.S. Treasury Department to mail the refund checks to locations that the perpetrators control or can access. In some cases, SIRF perpetrators bribe mail carriers to remove the refund checks from their mail routes.
- With the fraudulently obtained refund checks in hand, SIRF perpetrators generate cash proceeds by depositing the checks into bank accounts that they control.
The Investigation
From December 2011 through April 2013, the defendants allegedly engaged in a SIRF scheme that resulted in more than $2 million in losses to the U.S. Treasury. The conspirators directed fraudulent treasury checks to addresses along a mail route they controlled. Once the checks had been intercepted, they were passed along to others and deposited into bank accounts controlled by the conspirators. The resulting proceeds were quickly withdrawn from the bank accounts and used for various personal expenses, including gambling in Atlantic City casinos and purchasing cars.
Rivera and Ortiz were U.S. Postal Service mail carriers who were allegedly bribed to divert checks from their mail route in Queens. After intercepting the checks, Rivera delivered them to Pena for approximately $400 per check. The fraudulently obtained checks ultimately were deposited into straw bank accounts controlled by Feliz, Isaias Hernandez, Raymundo Hernandez, and Bernard.Feliz, Isaias Hernandez, Raymundo Hernandez, and Bernard incorporated businesses in New York or New Jersey. Within a few days of incorporating each business, they opened up a straw bank account at a Sovereign Bank branch in the business’ name. For the next few months, they deposited hundreds of thousands of dollars in fraudulently obtained checks into the straw bank accounts and quickly withdrew significant sums of cash.
Isaias Hernandez, Feliz, and Raymundo Hernandez used the proceeds of the scheme to purchase vehicles at auction. Raymundo Hernandez spent thousands of dollars at Atlantic City casinos.
The conspiracy charge is punishable by a maximum potential penalty of 10 years in prison and a fine of up to $250,000, or twice the gain or loss caused by the offense.
U.S. Attorney Fishman credited special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen; postal inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge Maria L. Kelokates; special agents of the U.S. Secret Service, under the direction of Special Agent in Charge James Mottola; and special agents of the U.S. Postal Service-Office of the Inspector General, under the direction of Special Agent in Charge Rafael A. Medina, with the investigation leading to today’s charges.The government is represented by Assistant U.S. Attorney Rahul Agarwal of the U.S. Attorney’s Office General Crimes Unit in Newark.
The charge and allegations contained in the Complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
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Pena, Luis et al. Complaint
Newark Man Sentenced to 46 Months in Prison in Scheme to Steal Checks from U.S. MailRead the Press Release
NEWARK, N.J. – A Newark man was sentenced to 46 months in prison for his role in a scheme to steal personal checks from the U.S. mail, fraudulently endorsed them and deposit them into personal checking accounts, U.S. Attorney Paul J. Fishman announced.
Kurtis Steele, 27, pleaded guilty Feb. 21, 2013 before U.S. District Judge Kevin McNulty to an Information charging him with one count of conspiracy to commit bank fraud. Judge McNulty imposed the sentence today in Newark federal court.
According to the documents filed in this case and statements made in court:
Steele and his conspirators gained access to and stole blank checks that were mailed to unsuspecting victims. Steele and his conspirators then fraudulently endorsed the blank checks for a certain sum and deposited those checks into legitimate bank accounts that they and unnamed conspirators opened at a number of banks, including TD Bank, Bank of America, Capital One Bank, Garden State Community Bank, Hudson City Savings Bank, PNC Bank and Valley National Bank.
Before the victims or banks discovered the checks were fraudulent, Steele and his conspirators had withdrawn the funds, either via Automated Teller Machine (ATM) or by entering the victim bank and filling out a withdrawal slip. U.S. Postal Inspection Service and FBI agents were able to obtain bank video surveillance which captured Steele making fraudulent deposits of the stolen checks and withdrawals of the proceeds of those checks.
Steele and his conspirators deposited $1,478,695 in fraudulent checks stolen from 122 victims. The checks were deposited into 258 different bank accounts opened by the defendants and/or unnamed conspirators. Steele and conspirators’ scheme resulted in $648,194 in losses.
In addition to a prison term, Judge McNulty sentenced Steele to three years of supervised release. Restitution will be determined at a later date.
Several of Steele’s conspirators were previously sentenced for their role in the fraudulent scheme: Constance Bowles, 23, of Newark, was sentenced to six months in prison and six months in a halfway house; Garnet Hinton, 24, of Union, N.J., was sentenced to 23 months in prison; Keonnah McLean, 24, of Newark, was sentenced to 23 months in prison; and Martell Arline, 22, if Newark, was sentenced to 36 months in prison. In addition to the prison terms, each of them was sentenced to three years of supervised release.
U.S. Attorney Fishman credited postal inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge Maria L. Kelokates; and special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford, with the investigation leading to the sentences.
The government is represented by Assistant U.S. Attorneys Dara Aquila Govan of the Organized Crime/Gangs Unit in Newark.13-218
Defense Counsel: Stephen A. Turano Esq., Newark
New York Attorney Arrested for Charging Hundreds of Thousands of Dollars for Advertisements Never PlacedRead the Press Release
Attorney Charged in New Jersey Allegedly Steered Payments to Company He Owned
NEWARK, N.J. – Federal agents arrested a New York attorney this morning to face a criminal complaint charging him with defrauding two international companies out of hundreds of thousands of dollars by fraudulently billing them for advertising services that were never provided, U.S. Attorney Paul J. Fishman announced.
Marijan Cvjeticanin, 49, of St. James, N.Y., is charged with one count of mail fraud. He was arrested at his home by special agents with U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and U.S. Department of State Diplomatic Security Service (DSS), and is scheduled to appear this afternoon before U.S. Magistrate Judge Madeline Cox Arleo in Newark federal court.
According to the complaint unsealed today:
From approximately September 1996 to September 2012, Cvjeticanin was employed by a New York law firm specializing in immigration law, first as a paralegal and then as an attorney. Among other clients, the firm represented two international companies – with offices in New Jersey – in connection with various immigration law matters. Cvjeticanin was the case manager handling day-to-day tasks such as filing applications for permanent residency for certain foreign workers of those companies employed in the United States on a temporary basis.
The application process required the companies to place job ads, in the geographic location where a relevant position was located, to demonstrate there were no minimally qualified U.S. citizens available to fill that position. To do that, Cvjeticanin caused his firm to retain a supposed advertising agency, Flowerson Holdings, Inc., a/k/a Flowerson Advertising, which allegedly handled all of the advertisement obligations of the companies in connection with permanent residency applications. Neither the firm nor the companies knew Cvjeticanin owned and controlled Flowerson.
From 2010 through September 2012, the companies paid Flowerson approximately $579,000 for advertisements, but Flowerson did not place the majority of those ads. Instead, Cvjeticanin stole the money and used it for his personal benefit.
If convicted, Cvjeticanin faces a maximum potential penalty of 20 years in prison and a $250,000 fine.U.S. Attorney Fishman praised special agents of ICE HSI, under the direction of Special Agent in Charge Andrew M. McLees in Newark, and DSS, under the direction of Special Agent in Charge Robert Goodrich, with the investigation.
The government is represented by Assistant U.S. Attorney Nicholas P. Grippo of the U.S. Attorney’s Office General Crimes Unit in Newark.The charge and allegations contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
13-215Defense counsel: TBD
Cvjeticanin, Marijan Complaint
Morris County, N.J., Man Sentenced to 140 Months in Prison for Distributing Images of Child Sexual Abuse over InternetRead the Press Release
NEWARK, N.J. – A Morris County, N.J., man was sentenced today to 140 months in prison today for possessing and distributing over the Internet images of child sexual abuse, U.S. Attorney Paul J. Fishman announced.
Khalil Survey, 39, of Lake Hiawatha, N.J., was previously arrested on a Complaint and later pleaded guilty before U.S. District Judge William H. Walls to an Indictment charging him with one count of possession of child pornography and one count of distributing child pornography.According to documents filed in this case and statements made in court:
Special agents of the Department of Homeland Security and other law enforcement executed a search warrant at Survey’s home on Aug. 4, 2011, and seized a computer, an iPhone, and several electronic storage devices that contained images and videos child pornography. The devices included 46,353 images of child sexual abuse, including 983 images involving infants or toddlers, and 783 images involving sadomasochistic abuse. On the defendant’s iPhone, law enforcement found photographs the defendant had taken of himself downloading child pornography onto his home computer.
In addition to the prison term, Judge Walls sentenced Survey to lifetime supervised release and ordered him to pay $300,000 in restitution to the victims.
U.S. Attorney Fishman credited special agents of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, under the direction of Special Agent in Charge Andrew M. McLees in Newark, with the investigation leading to today’s sentencing. He also thanked the Morris County Prosecutor’s Office for its role in the investigation.
The government is represented by Assistant U.S. Attorney Andrew J. Bruck of the U.S. Attorney’s Office General Crimes Unit in Newark.13-217
Defense counsel: Joseph Rotella Esq., Newark
Two Convicted by New Jersey Federal Jury for Scheme to Rob Drug Dealers and Sell Their CocaineRead the Press Release
CAMDEN, N.J. – Two men who plotted to rob a drug stash house in order to sell the stolen cocaine were convicted today by a federal jury in New Jersey of crimes related to the scheme, U.S. Attorney Paul J. Fishman announced.
Ralph Dennis, 35, and Terrance Hardee, a/k/a “Fat Cat,” 36, both of Philadelphia, were each convicted of one count of conspiracy to commit robbery and one count of conspiracy to possess more than 5 kilograms of cocaine with intent to distribute. Dennis was also found guilty of using and carrying a firearm during a crime of violence. The jury returned the verdict on the second day of deliberations following an approximately three-week trial before U.S. District Judge Joseph E. Irenas in Camden federal court.
According to the evidence at trial:
In June and July of 2012, Dennis and Hardee engaged in the planning of a gunpoint drug stash house robbery. They prepared to steal multiple kilograms of cocaine from the drug dealers at the location, then sell it themselves to make a profit.
During the investigation, Dennis was recorded discussing his willingness to kill anyone they found inside the house as they were robbing it. Hardee was recorded talking about his role – tying the house’s occupants up with zip ties.
Special agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) arrested the pair when they showed up in Maple Shade, N.J., on July 16, 2012, to head to the robbery location, Dennis carrying a gun. Dennis and Hardee also brought gloves, and zip ties were found in the car they drove to Maple Shade.
At sentencing, the defendants face a maximum potential penalty of 20 years in prison on the robbery conspiracy charge and a mandatory minimum penalty of 10 years and a maximum of life in prison on the cocaine distribution charge. Additionally, Dennis faces a mandatory minimum of five years in prison – consecutive to the sentence imposed for the robbery conspiracy – and a maximum of life in prison for the gun offense. Each count also carries a maximum $250,000 fine. A sentencing date has not yet been set.
U.S. Attorney Fishman credited ATF special agents in Cherry Hill, N.J., under the direction of Special Agent in Charge Thomas J. Cannon, with the investigation leading to today’s convictions.
The government is represented by Assistant U.S. Attorneys Jacqueline M. Carle and Matthew T. Smith of the U.S. Attorney’s Office Criminal Division in Camden.
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Defense counsel:Ralph Dennis: Assistant Federal Public Defenders Thomas Young & Christopher O’Malley Esqs., Camden
Terrance Hardee: David Rudenstein, Esq., PhiladelphiaMorris County, N.J., Man Sentenced to Lengthy Prison Term for Distributing Videos of Child Sexual Abuse over the InternetRead the Press Release
CAMDEN, N.J. – A Morris County, N.J., man was sentenced today in Camden federal court to 210 months in prison for distributing images and videos of child sexual abuse over the Internet, U.S. Attorney Paul J. Fishman announced.
William Rensing, 46, of Lincoln Park, N.J., previously pleaded guilty to one count of an indictment charging him with distribution of child pornography. Rensing entered his guilty plea before U.S. District Judge Jerome B. Simandle, who also imposed the sentence today. Rensing has been in federal custody since his arrest.
According to documents filed in the case and statements made in court:
Law enforcement executed a search warrant at Rensing’s home on July 27, 2011, and seized a notebook computer that contained images and videos of child sexual abuse, including depictions of children as young as 6 years old. Rensing was arrested the same day. He later admitted in court that on March 25, 2011, he used peer-to-peer file-sharing software to share images and videos of child sexual abuse through the Internet.
The length of Rensing’s sentence is due in part to his prior conviction for sexual assault of a minor. In addition to the prison term, Judge Simandle sentenced Rensing to serve 10 years of supervised release.U.S. Attorney Fishman praised special agents of Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent in Charge Andrew M. McLees in Newark, for the investigation, as well as detectives of the Morris County Prosecutor’s Office.
The government is represented by Assistant U.S. Attorney Daniel V. Shapiro of the U.S. Attorney’s Office General Crimes Unit in Newark.
13-212Defense counsel: Sean McGovern Esq., Newark
Camden Man Sentenced to Seven Years in Prison for Unlawful Possession of A Stolen Semiautomatic HandgunRead the Press Release
CAMDEN, N.J. – A Camden man with prior felony convictions was sentenced today to 84 months in prison for unlawfully possessing a semiautomatic handgun, U.S. Attorney Paul J. Fishman announced.
Bryon Goodman, 28, previously pleaded guilty before U.S. District Judge Robert B. Kugler to an Indictment charging him with being a felon in possession of a firearm. Judge Kugler imposed the sentence today in Camden federal court.
According to documents filed in the case and statements made in court:
On Feb. 7, 2012, Goodman knowingly possessed a loaded Ruger P89 9mm semiautomatic handgun at a Crown Fried Chicken restaurant in Camden. Camden police observed Goodman rolling a marijuana cigarette. Goodman was searched and found with the handgun, as well as various illegal drugs, including crack, heroin, and marijuana.
In addition to the prison term, Judge Kugler sentenced Goodman to three years of supervised release.
U.S. Attorney Fishman credited special agents of the Bureau of Alcohol, Tobacco, Firearms, and Explosives, under the direction of Special Agent in Charge Thomas J. Cannon in Newark, with the investigation leading to today’s sentencing. He also thanked the N.J. State Police, the Camden County Prosecutor’s Office, and the Camden Police Department for their roles in the investigation.
The government is represented by Assistant U.S. Attorney Alyson M. Oswald of the U.S. Attorney’s Office Criminal Division in Camden.
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Defense counsel: Christopher H. O’Malley Esq., Assistant Federal Public Defender, CamdenCamden Man Admits Conspiracy to Steal Checks from MailRead the Press Release
CAMDEN, N.J. – A Camden man today admitted his role in a scheme in which he and others stole business checks from the U.S. Mail in New Jersey and Connecticut, altered them, and cashed them using a series of conspirators, U.S. Attorney Paul J. Fishman announced.
Michael A. Ingalls, Jr., 35, pleaded guilty before Chief U.S. District Judge Jerome B. Simandle in Camden federal court to an Information charging him with one count of conspiracy to commit bank fraud and one count of possession of stolen mail.
According to documents filed in this case and statements made in court:
Ingalls and others stole checks from curbside U.S. mailboxes in business industrial parks in Burlington, Camden, and Gloucester counties in New Jersey. Ingalls and his co-conspirators (including Ibn Muhammad, 35, of Camden) would then recruit a conspirator to cash the stolen checks. Once they identified a person to cash the check, Ingalls and Muhammad would then alter the stolen checks so that the name of the “payee” of the check would match the name of the recruited check casher. Ingalls, Muhammad and the check casher would then travel to a bank where the check casher would cash the check.
Ingalls, Muhammad and their conspirators cashed or attempted to cash more than 100 stolen and altered business checks worth more than $600,000. The scheme resulted in a total loss of more than $300,000 to the victim banks.
Ingalls is also charged with possession of mail stolen from business industrial parks in Brookfield, Conn. The stolen mail was found after Ingalls was stopped for speeding by the N.J. State Police in Middlesex County while headed southbound on the N.J. Turnpike in the early morning hours of Feb. 27, 2011.
On the count of conspiracy to commit bank fraud, Ingalls faces a maximum potential penalty of 30 years in prison and a fine of $1 million, or twice the gross gain or loss resulting from the offense. On the count of possession of stolen mail, Ingalls faces a maximum potential penalty of five years in prison and a fine of $250,000. Sentencing is scheduled for Sept. 5, 2013.
Muhammad pleaded guilty Dec. 3, 2012, before Judge Simandle to bank fraud and theft of mail. He is currently in custody and is scheduled to be sentenced on June 17, 2013. One of Ingalls’ and Muhammad’s conspirators, Andrew Fortune, 62, of Camden, was arrested March 11, 2013, on a criminal complaint and charged with conspiracy to commit bank fraud for his role in the fraudulent scheme. His case is pending.
U.S. Attorney Fishman credited special agents from the U.S. Postal Inspection Service, under the direction of Karen V. Higgins, and troopers from the N.J., State Police, under the direction of Col. Rick Fuentes, for the investigation leading to today's guilty plea.
The Government is represented by Assistant U.S. Attorneys Matthew T. Smith and Jason M. Richardson of the U.S. Attorney’s Office Criminal Division in Camden.
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Defense counsel: Richard Sparaco Esq., Cherry Hill, N.J.
Ingalls, Michael Information
Somerset County, N.J., Man Charged with Possession of Child PornographyRead the Press Release
TRENTON, N.J. – A Somerset County, N.J., man made his initial court appearance today after being arrested for allegedly possessing multiple, sexually suggestive images of children, U.S. Attorney Paul J. Fishman announced.
Patrick T. Deck, 53, of Watchung, N.J., is charged by Complaint with one count of possessing child pornography. He made his initial court appearance this morning before U.S. Magistrate Judge Tonianne J. Bongiovanni in Trenton federal court and was detained without bail.
According to documents filed in this case and statements made in court:In August 2012, law enforcement agents executed a search warrant at Deck’s residence. They determined that Deck’s laptop computer contained multiple images of child pornography, which appeared to have been downloaded from the Internet.
The possession of child pornography count with which Deck is charged is punishable by a maximum potential penalty of 10 years in prison and a fine of $250,000.
U.S. Attorney Fishman credited special agents of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, under the direction of Special Agent in Charge Andrew M. McLees in Newark, for the investigation leading to the arrest. Fishman also thanked the N.J. State Police and the Warren County Prosecutor’s Office for their assistance with the investigation.
The government is represented by Assistant U.S. Attorney Fabiana Pierre-Louis of the U.S. Attorney’s Office Criminal Division in Trenton.
The charges and allegations contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
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Deck, Patrick Complaint
Personal Trainer Arrested for Conspiracy to Distribute SteroidsRead the Press Release
NEWARK, N.J. – A Middlesex County, N.J., man who works as a personal trainer was arrested this morning for conspiring to distribute more than 89,000 units of anabolic steroids in both pill and liquid form, U.S. Attorney Paul Fishman announced.
Richard Gray, 60, of Port Reading, N.J., was arrested this morning by special agents of the Department of Homeland Security, Homeland Security Investigations. He is charged by Complaint with conspiracy to distribute anabolic steroids. He is scheduled to make his initial appearance later today before U.S. Magistrate Judge Mark Falk.
According to the Complaint:
On April 23, 2013, agents of Customs and Border Protection (CBP) conducted a routine border inspection of a package that was shipped from China to a package consignment store in Edison, N.J. The package’s mail declaration stated that it contained hardware products and was addressed to a business, Custom Parts, in care of the consignment store. When CBP inspected the package, agents found approximately 110 ampules that were individually labeled as different types of anabolic steroids, including “Mastabol, Dromastanolone Enanthate,” “Testosterone,” “Boldenone Undecylenate,” “Nandrolone Decanoate,” and “Testosterone Enanthate.”Store employees identified Gray as the person who was supposed to pick up the package and told investigators the store was holding another package for Gray, which was nearly identical to the first package and had been sent by the same shipper. Gray was arrested when he arrived at the store to pick up the second package.
Gray then consented to have his home searched. Investigators found in the storage room in Gray’s basement a substantial amount of anabolic steroids, which were in both liquid and pill form. Some of the steroids were meticulously labeled and organized in boxes and individual trays, which were then placed on metal shelves. Others were stored in large, gallon-sized plastic bags.
U.S. Attorney Fishman credited special agents of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, under the direction of Special Agent in Charge Andrew M. McLees in Newark; special agents of U.S. Customs and Border Protection, under the direction of Robert E. Perez, director of New York Field Operations; and the Middlesex County Prosecutor’s Office, under the direction of Acting Prosecutor Andrew Carey, with the investigation leading to today’s arrest.
The government is represented by Assistant U.S. Attorney Courtney M. Oliva of the U.S. Attorney’s Office General Crimes Unit in Newark.
The charge and allegations contained in the Complaint are merely accusations, and the defendant is considered innocent unless and until proven guilty.
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Defense counsel: Carol Gillen Esq., Assistant Federal Public Defender, Newark
Gray, Richard Complaint
Attachment A
Attachment B
Attachment CNew Jersey Doctor Convicted by Federal Jury for Writing Illegal Oxycodone Presctiptions in Drug Distribution ConspiracyRead the Press Release
TNEWARK, N.J. – An internal medicine specialist who wrote illegal prescriptions for oxycodone was convicted today by a federal jury in New Jersey for his role in a conspiracy that put tens of thousands of prescription pills on the streets for resale, U.S. Attorney Paul J. Fishman announced.
Michael Durante, 59, of Montclair, N.J., was convicted of 16 of the 17 counts in the superseding indictment against him: one count of conspiracy to distribute oxycodone and 15 counts of unlawful distribution of the drug. The jury returned the verdict on the second day of deliberations following a nearly three-month trial before U.S. District Judge Stanley R. Chesler in Newark federal court.
According to the evidence at trial:
Between 2009 and March 2011, Durante regularly sold prescriptions of oxycodone to several people knowing the drugs would be resold on the street for profit. Two individuals in particular – Andre Domando, 48, of Belleville, N.J., and Dennis Abato, 61, of Lakewood, N.J. – each had a stable of patients they brought to Durante’s medical practice in Nutley, N.J., so he could give them prescriptions for large quantities of oxycodone that would ultimately be sold through the redistribution network. Domando and Abato have each pleaded guilty in connection with the scheme.
In February of 2011, several undercover recordings were produced that showed Durante’s understanding of the illegal distribution he facilitated. At one point, Durante said he knew Domando was reselling the prescriptions for a large profit, stating, “I just know because my friend does the same thing you do. He sells these for a thousand to twelve hundred dollars a bottle.” Durante, referring to prescriptions he provided to Domando over the previous week, then stated “[s]o two last week, four this week – you should have six thousand dollars in your pocket,” adding, “I know what people do with these things. You gotta have at least twelve, fifteen thousand dollars a month of income here.”
Durante was also captured on tape accepting $300 from Domando in exchange for prescriptions, as well as $100 for an extra prescription he sold to an undercover agent. At trial, a witness testified that he delivered envelopes of cash to Durante in exchange for extra prescriptions.
Additionally, Durante falsified medical records in the files of the patients who received the oxycodone prescriptions he sold to Domando, Abato and others. Typically, Durante would omit from the progress notes for those patients many of the additional prescriptions he had sold. On other occasions, he falsely wrote that prescriptions had been provided to replace lost prescriptions – including noting on one occasion that a dog may have eaten one of the prescriptions he provided to Domando.
In total, Durante provided prescriptions for more than 70,000 oxycodone pills to be illegally resold by his coconspirators.
At sentencing, Durante faces a maximum potential penalty of 20 years in prison and a $250,000 fine on each of the 16 counts of which he was convicted. A sentencing date has not yet been set. A hearing has been scheduled for tomorrow, May 23, 2013, to discuss the forfeiture of nearly $300,000 in cash found in Durante’s home.
U.S. Attorney Fishman credited the New Jersey DEA Tactical Diversion Squad, made up of DEA special agents, diversion investigators and intelligence analysts; FBI and IRS special agents; and law enforcement officers from the Essex County Sheriff’s Department and the Elizabeth, Clinton Township (Hunterdon County), Toms River and Newark Police Departments with the investigation leading to today’s conviction.
The government is represented by Assistant U.S. Attorneys Anthony Mahajan and Osmar J. Benvenuto of the U.S. Attorney’s Office Criminal Division in Newark.
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Defense counsel: Cathy Fleming and Harold Ruvoldt Esqs., New YorkNew Jersey Doctor Convicted by Federal Jury for Writing Illegal Oxycodone Presctiptions in Drug Distribution ConspiracyRead the Press Release
TNEWARK, N.J. – An internal medicine specialist who wrote illegal prescriptions for oxycodone was convicted today by a federal jury in New Jersey for his role in a conspiracy that put tens of thousands of prescription pills on the streets for resale, U.S. Attorney Paul J. Fishman announced.
Michael Durante, 59, of Montclair, N.J., was convicted of 16 of the 17 counts in the superseding indictment against him: one count of conspiracy to distribute oxycodone and 15 counts of unlawful distribution of the drug. The jury returned the verdict on the second day of deliberations following a nearly three-month trial before U.S. District Judge Stanley R. Chesler in Newark federal court.
According to the evidence at trial:
Between 2009 and March 2011, Durante regularly sold prescriptions of oxycodone to several people knowing the drugs would be resold on the street for profit. Two individuals in particular – Andre Domando, 48, of Belleville, N.J., and Dennis Abato, 61, of Lakewood, N.J. – each had a stable of patients they brought to Durante’s medical practice in Nutley, N.J., so he could give them prescriptions for large quantities of oxycodone that would ultimately be sold through the redistribution network. Domando and Abato have each pleaded guilty in connection with the scheme.
In February of 2011, several undercover recordings were produced that showed Durante’s understanding of the illegal distribution he facilitated. At one point, Durante said he knew Domando was reselling the prescriptions for a large profit, stating, “I just know because my friend does the same thing you do. He sells these for a thousand to twelve hundred dollars a bottle.” Durante, referring to prescriptions he provided to Domando over the previous week, then stated “[s]o two last week, four this week – you should have six thousand dollars in your pocket,” adding, “I know what people do with these things. You gotta have at least twelve, fifteen thousand dollars a month of income here.”
Durante was also captured on tape accepting $300 from Domando in exchange for prescriptions, as well as $100 for an extra prescription he sold to an undercover agent. At trial, a witness testified that he delivered envelopes of cash to Durante in exchange for extra prescriptions.
Additionally, Durante falsified medical records in the files of the patients who received the oxycodone prescriptions he sold to Domando, Abato and others. Typically, Durante would omit from the progress notes for those patients many of the additional prescriptions he had sold. On other occasions, he falsely wrote that prescriptions had been provided to replace lost prescriptions – including noting on one occasion that a dog may have eaten one of the prescriptions he provided to Domando.
In total, Durante provided prescriptions for more than 70,000 oxycodone pills to be illegally resold by his coconspirators.
At sentencing, Durante faces a maximum potential penalty of 20 years in prison and a $250,000 fine on each of the 16 counts of which he was convicted. A sentencing date has not yet been set. A hearing has been scheduled for tomorrow, May 23, 2013, to discuss the forfeiture of nearly $300,000 in cash found in Durante’s home.
U.S. Attorney Fishman credited the New Jersey DEA Tactical Diversion Squad, made up of DEA special agents, diversion investigators and intelligence analysts; FBI and IRS special agents; and law enforcement officers from the Essex County Sheriff’s Department and the Elizabeth, Clinton Township (Hunterdon County), Toms River and Newark Police Departments with the investigation leading to today’s conviction.
The government is represented by Assistant U.S. Attorneys Anthony Mahajan and Osmar J. Benvenuto of the U.S. Attorney’s Office Criminal Division in Newark.
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Defense counsel: Cathy Fleming and Harold Ruvoldt Esqs., New YorkManager of International Alien Smuggling Ring Sentenced in New Jersey to 51 Months in PrisonRead the Press Release
Some Customers of Illegal Ring Worked off Debts in Newark Strip Clubs
CAMDEN, N.J. – A manager and supervisor of an international scheme responsible for smuggling into the United States hundreds of illegal aliens from Brazil, India and elsewhere was sentenced today to 51 months in prison, U.S. Attorney Paul J. Fishman announced.
Sanderlei Alves DaCruz, a/k/a “Kauan,” a/k/a “Kauan Santana,” a/k/a “Sidney Gomes Figueredo,” 33, of Houston, previously pleaded guilty before U.S. District Judge Joseph H. Rodriguez to an indictment charging him with one count of participating in a conspiracy to bring aliens into the United States illegally. Judge Rodriguez imposed the sentence today in Camden federal court.According to documents filed in this case and statements made in court:
From January 2008 through June 2011, DaCruz conspired with others in New Jersey, Massachusetts, Texas and elsewhere to bring aliens into the United States illegally from a number of other countries as part of an elaborate for-profit alien smuggling scheme. The conspirators arranged, facilitated and monitored the travel of customers along two primary smuggling routes – the first of which included travel through Central America and across the international border between Mexico and the United States. The second route included travel through St. Maarten and the Bahamas, followed by a series of boat trips to either Puerto Rico or the Florida coast.
Through the interception of the conspirators’ cell phone calls, the use of confidential sources of information and other means, law enforcement agents learned that the defendants charged customers of the alien smuggling scheme from $13,000 to more than $25,000 – depending on the route used and whether the customer paid in advance or in installments after arriving in the United States.
Many of the customers of the scheme were young women from Brazil, most of whom agreed to repay part of their smuggling debt after arriving in the United States by working as dancers in strip clubs in Newark and elsewhere.
In addition to the prison term, Judge Rodriguez sentenced DaCruz to serve three years of supervised release.
On Dec. 21, 2011, other members of the conspiracy including Nacip Teotonio Pires, a/k/a “Ze Maria,” a/k/a “Baraso,” 49, of Newark; Rubens DaSilva, a/k/a “Diogo Oliveira,” 41, of Haverhill, Mass.; and Claudinei Pereira Mota, 35, of Newark, each pleaded guilty before Judge Rodriguez to an information charging them with conspiring to bring aliens into the country illegally. A fifth member of the smuggling ring, Francismar Da Conceicao, a/k/a “Alex,” 38, of Hillside, N.J., pleaded guilty to a similar charge a few days earlier. Priscilla (last name unknown), a/k/a “Clema Aparacida Lopes,” of Long Branch, N.J., remains at large.
U.S. Attorney Fishman credited special agents of Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent in Charge Andrew M. McLees, with the investigation.
The government is represented by Assistant U.S. Attorney Leslie Faye Schwartz of the U.S. Attorney’s Office Economic Crimes Unit in Newark.
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Defense counsel: Paulette Pitt Esq., Woodbridge, N.J.Former Employee of Timeshare Consulting Firm Admits Conspiring to Defraud Timeshare OwnersRead the Press Release
CAMDEN, N.J. – A former employee of The Vacation Ownership Group LLC admitted to conspiring to defraud owners of timeshare properties by offering phony consulting services, U.S. Attorney Paul J. Fishman announced. She also admitted to illegally collecting unemployment benefits.
Catherine Bannigan, 58, of Ventnor, N.J., pleaded guilty today before U.S. District Court Judge Noel L. Hillman in Camden federal court to an Information charging her with one count of conspiracy to commit mail and wire fraud and one count of wire fraud.
According to documents filed in this case and statements made in court:
The Vacation Ownership Group, a/k/a VO Group LLC, had offices in Mays Landing, N.J., and Egg Harbor Township, N.J., and claimed to offer consulting services to owners of timeshares, including cancelling, purchasing and upgrading the timeshares.
In 2010, Bannigan started working at the VO Group and was trained by VO Group co-owner Adam Lacerda to call customers using prepared scripts. The defendant called customers and gave them the false impression that they were working for a bank or lending institution. After hearing the Bannigan’s false representations, some customers sent checks to the VO Group. For example, Bannigan falsely told victim “JL” that a committee at the VO Group was meeting, that Bannigan had scheduled JL’s case to be heard by the committee, and that she needed to mark her complaint resolved or unresolved, to induce JL to send the VO Group money. Bannigan admitted causing more than $70,000 in losses.
Bannigan also admitted to devising a separate scheme to defraud the N.J. Department of Labor by collecting unemployment compensation benefits while working at the VO Group. Bannigan admitted to applying for and being awarded $4,914 in unemployment compensation benefits to which she was not entitled.
On Jan. 23, 2013, co-owners Adam Lacerda and Ashley Lacerda and other members of the VO Group were charged in a Superseding Indictment with conspiracy to commit mail and wire fraud and other charges. Additional members of the VO Group were also charged by Criminal Complaint in April 2012. To date, 11 members of the VO Group have pleaded guilty to conspiring to commit mail fraud and wire fraud. As for the Lacerdas and other defendants who have not been convicted in this case, the charges and allegations against them are merely accusations and they are considered innocent unless and until proven guilty.
The mail and wire fraud conspiracy charge to which Bannigan pleaded guilty is punishable by a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gain or loss caused by the offense. The wire fraud charge is also punishable by a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gain or loss caused by the offense. Sentencing is scheduled for Oct. 4, 2013.
U.S. Attorney Fishman credited special agents from the FBI’s Atlantic City Resident Agency, under the direction of Special Agent in Charge Aaron T. Ford in Newark; and special agents from the Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, under the direction of Special Agent in Charge Robert Panella, New York Region, for their roles in the investigation leading to the guilty pleas. He also thanked the N.J. Department of Labor, Benefit Payment Control Unit, for its assistance.
The government is represented by Assistant U.S. Attorneys Alyson M. Oswald and R. David Walk, Jr. of the U.S. Attorney’s Office Criminal Division in Camden.
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Defense counsel: Rocco C. Cipparone Jr., Esq., Haddon Heights, NJ
Bannigan, Catherine Information
Alleged Conspirator Arrested, Four Indicted for Armed Robberies of New Jersey T-Mobile StoresRead the Press Release
NEWARK, N.J. – FBI special agents arrested a Roslyn Heights, N.Y., man near his home this morning to face an indictment charging him and three other men with various offenses in connection with two armed robberies of T-Mobile stores in Linden and Woodbridge, N.J., U.S. Attorney Paul J. Fishman announced.
Leonard Arrington, 27, is charged in the indictment – along with Carl Williams, 29, and Eric Williams, 32, of Brooklyn, N.Y. – with one count of conspiracy to commit Hobbs Act robberies, one count of committing a Hobbs Act robbery and one count of using a firearm during a crime of violence. Terrell McQueen, 29, of Elizabeth, N.J., is charged in the indictment with the same offenses, as well as an additional count each of Hobbs Act robbery and using a firearm during a crime of violence.
McQueen, Carl Williams and Eric Williams (no relation) were initially arrested and charged by criminal complaint with the conspiracy and firearms counts on Feb. 14, 2013. They appeared that day before U.S. Magistrate Judge Mark Falk, who remanded them to federal custody pending trial.
Arrington is expected to appear today before Judge Falk in Newark federal court.
According to the indictment unsealed today and other documents filed in this case:
On Sept. 20, 2012, Carl Williams and another man, brandishing a firearm, walked into a T-Mobile store in Linden. They then tied up the employees in the back of the store, stole approximately 50 to 60 cell phones, and fled in a Land Rover.
McQueen, Eric Williams and other conspirators then delivered the stolen phones to a cell phone store in Brooklyn.
On Oct. 2, 2012, Arrington entered a T-Mobile store in Woodbridge, carrying a gun, along with another man. After locking the front door, the men took the employees to the back of the store and tied them up, then stole approximately 40 cell phones. One of the robbers then called the getaway driver, who drove them away in a Land Rover. McQueen, Eric Williams, and others delivered the stolen phones to the same Brooklyn store.
The charges of Hobbs Act conspiracy and robbery (Counts One, Two and Four) carry a maximum potential penalty of 20 years in prison. The charge of brandishing a firearm during a crime of violence (Counts Three and Five) carries a maximum potential penalty of life in prison and a mandatory minimum sentence of seven years for the first count of conviction, and 25 years for the second count of conviction, each of which must run consecutively to one another and to any other prison term. Each of the five counts also carries a maximum fine of $250,000.
U.S. Attorney Fishman praised special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford, with the investigation leading to the arrest and charges. He also thanked the Linden and Woodbridge Police Departments in New Jersey, as well as the New York City and Nassau County Police Departments and the Kings County District Attorney’s Office in New York for their excellent work in this case.
The government is represented by Assistant U.S. Attorneys Osmar J. Benvenuto and Nicholas P. Grippo of the U.S. Attorney’s Office General Crimes Unit in Newark.The charges and allegations contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
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Defense counsel:Terrell McQueen: Anthony J. Pope Esq., Newark
Carl Williams: Mark A. Berman Esq., River Edge, N.J.
Eric Williams: Aaron M. Goldsmith Esq., New York
Leonard Arrington: TBDMcQueen, Terrell et al. Indictment
Alleged Fugitive Sought for Three Years Arrested in Atlantic CityRead the Press Release
CAMDEN, N.J. – A former Atlantic County man who has allegedly been a fugitive since being charged in 2010 with multiple crimes in connection with a large-scale heroin distribution conspiracy was arrested last night in Atlantic City, U.S. Attorney Paul J. Fishman announced.
Edward Brown Jr., a/k/a “Edward Brown,” a/k/a “Eddie Brown,” a/k/a “Eddie Cane,” a/k/a “Cane,” 24, was arrested without incident at 9:30 p.m. last night by Task Force Officers of the FBI, along with members of the Atlantic City Police Department. He will be arraigned before U.S. Magistrate Judge Joel Schneider in Camden federal court later today. Brown was charged by local law enforcement in 2010 in connection with the drug trafficking organization. He was indicted by a federal grand jury in July 2012 and charged with conspiracy to distribute heroin.
According to documents filed in this case and statements made in court:
Beginning in March 2010, FBI special agents and members of the Atlantic County Prosecutor’s Office used wiretaps to intercept telephone conversations among Brown; Jamal Reid, 28, of Mays Landing, N.J., the alleged leader of the organization; and others. The monitored calls and other information revealed that Reid, Brown, and others were distributing large amounts of heroin. During the calls, agents overheard Reid arranging for the delivery of heroin from northern New Jersey to Sicklerville, where it would be accepted by Brown and other conspirators. Agents overheard Reid arrange the collection of money from other members of his organization to pay for the heroin, and they overheard Reid direct the sale and distribution of heroin to others. Agents observed Brown meeting with Reid and his conspirators on numerous occasions.
Reid pleaded guilty May 13, 2013, to a Superseding Indictment charging him with knowingly and intentionally conspiring to distribute one kilogram or more of heroin, and possession of a firearm by a previously convicted felon. He is scheduled to be sentenced Aug. 14, 2013.
Brown was charged by criminal complaint in January 2012. On July 10, 2012, a federal grand jury returned a Superseding Indictment charging Brown with conspiracy to distribute one kilogram or more of heroin. The charge is punishable by a minimum of 10 years in prison and a maximum of life in prison and a $10 million fine.
Ten people were charged for their roles in this heroin distribution conspiracy. To date, six individuals have pleaded guilty to conspiracy to distribute heroin, two remain incarcerated pending trial, and one individual – Matthew Palmer, a/k/a “Matt,” a/k/a “White Boy Matt,” a/k/a “White Boy – remains a fugitive.
U.S. Attorney Fishman credited FBI’s Atlantic City Resident Agency Safe Streets Task Force, which during the Reid investigation consisted of task force officers from the Atlantic County Prosecutor’s Office, the Atlantic City Police Department, the Northfield Police Department, and the Pleasantville Police Department, and special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark; and special agents from the Bureau of Alcohol, Tobacco, Firearms & Explosives, under the direction of Special Agent in Charge Thomas J. Cannon in Newark.
The government is represented by Assistant U.S. Attorneys Alyson M. Oswald and Jason M. Richardson of the U.S. Attorney’s Office Criminal Division in Camden.
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Brown, Eddie Superseding Indictment
New Jersey Law Office Employee Indicted for Possessing, Distributing Images of Child Sexual Abuse from Work ComputerRead the Press Release
NEWARK, N.J. – A registered sex offender employed at a law office in Paterson, N.J., was indicted today by a federal grand jury in Newark for allegedly possessing and distributing images of child sex abuse over the Internet, U.S. Attorney Paul J. Fishman announced.
Kevin Rease, 33, of Hackettstown, N.J., was charged by complaint in April 2013 with one count of distributing images of child sex abuse over the Internet and has been held in federal custody since that time. Today’s indictment charges two counts of distribution and one count of possession of the images. Rease will be arraigned on the indictment on a date to be determined.
According to the indictment returned today and other documents filed in this case:
On March 12, 2013, an undercover FBI agent downloaded images depicting child sexual abuse from an individual using an assumed name on a public Internet-based peer-to-peer file sharing network. The investigation revealed that the individual was logged on to the network using an Internet Protocol, or “IP,” address belonging to the law office where he worked.
The FBI executed a search warrant in April 2013 at the Paterson law office, seizing digital images depicting child sexual abuse, including material involving prepubescent minors. Rease’s work computer was logged onto the peer-to-peer network at the time, under the same assumed name which had offered illegal images for download on March 12.
As a previously convicted sex offender, Rease faces a mandatory minimum penalty of 15 years in prison, a maximum potential penalty of 40 years in prison, and a $250,000 fine per count if convicted of the distribution offenses. He also faces a mandatory minimum penalty of 10 years in prison, a maximum penalty of 20 years in prison, and a $250,000 fine if convicted of the possession count.U.S. Attorney Fishman credited special agents of the FBI, Newark Division’s Child Exploitation Task Force, under the direction of Special Agent in Charge Aaron T. Ford in Newark, with the investigation.
The government is represented by Assistant U.S. Attorney Danielle Alfonzo Walsman of the U.S. Attorney’s Office General Crimes Unit in Newark.
The charge and allegations contained in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
13-203Defense counsel: William Ware Esq., Chester, N.J.
Rease Indictment
Princeton, N.J., Youth Soccer Coach Arrested, Charged with Possessing Images of Sexually Exploited ChildrenRead the Press Release
TRENTON, N.J. – A Princeton, N.J., youth soccer coach was arrested today after law enforcement officers searching his home allegedly discovered compromising, sexual movies of minor boys, U.S. Attorney Paul J. Fishman announced.
Jorge A. Roman, 48, is charged by criminal complaint with one count of possessing images of child pornography. Roman appeared this afternoon before U.S. Magistrate Judge Douglas E. Arpert in Trenton federal court and was detained pending satisfaction of his bail conditions.
According to the criminal complaint filed today:
During a period lasting approximately five years, Roman ordered – on more than 40 occasions – films exploiting nude, minor boys that were marketed as “naturist films from around the world.” The orders included DVDs, photo CDs and downloadable links.
The count with which Roman is charged carries a maximum potential penalty of 10 years in prison and a $250,000 fine.U.S. Attorney Fishman credited postal inspectors, under the direction of Postal Inspector in Charge Maria L. Kelokates, with the investigation leading to today’s arrest.
The government is represented by Special Assistant U.S. Attorney Joseph Muoio of the U.S. Attorney’s Office in Trenton.
The charge and allegations contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
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Defense counsel: Assistant Federal Public Defender Lisa Van Hoeck
Roman Complaint
Camden, N.J., Man Allegedly Exchanged More Than $1 Million in Snap/Food Stamp Benefits for CashRead the Press Release
CAMDEN, N.J. – A Camden man who allegedly stole more than $1 million dollars from the U.S. Government through a food stamps scheme was arrested by federal agents this morning, U.S. Attorney Paul J. Fishman announced.
Alexander D. Vargas, 34, was charged in connection with a scheme in which he allegedly purchased Supplemental Nutrition and Assistance Program (SNAP) benefits (formerly known as food stamps) for 50 cents on the dollar at the local grocery store he was managing in Camden. He is charged by Complaint with one count of stealing monies from the United States. Vargas was arrested by agents of the Department of Agriculture, Office of Inspector General, Homeland Security Investigations and the IRS. He is scheduled to appear this afternoon before U.S. Magistrate Judge Joel Schneider in Camden federal court.
According to documents filed in this case:
From February 2012 through December 2012 Vargas managed Eddies Grocery, a small grocery store in Camden that was authorized to accept SNAP benefits. The program is administered by the U.S. Department of Agriculture. Retail food stores that have been approved for participation in SNAP may sell food in exchange for food stamp benefits. They may not, however, exchange food stamp benefits for cash.
Every food stamp recipient receives an Electronic Benefits Transfer (EBT) card, similar to a debit card, with which to make purchases. Every retailer authorized to accept food stamp benefits has an EBT terminal. Food purchases are made by swiping the card at the terminal. After the customer enters a secret Personal Identification Number (PIN), the EBT terminal verifies the PIN, determines whether the customer’s account balance is sufficient to cover the proposed transaction and informs the retailer whether the transaction should be authorized or denied. If the transaction is authorized, the amount of the purchase is then deducted electronically from the food stamp benefits reserved for the customer, and the amount is credited to the retailer’s designated bank account.
Eddies Grocery designated a bank account at Sovereign Bank to receive the reimbursements for SNAP benefits. Bank records listed Vargas as the manager of Eddies Grocery, and another individual as the owner of the store.Eddies Grocery was first approved to participate in the SNAP program in 2007. In his application to participate in SNAP, the owner estimated that Eddies Grocery would generate receipts of approximately $280,000 annually, or an average of approximately $23,333 per month. The volume of SNAP benefits reimbursement received at Eddies Grocery substantially exceeded those estimates, indicating large scale food stamp fraud. From February 2012 through November 2012 the SNAP redemptions were more than $2.8 million greater than the estimates:
Month / Year
SNAP Redemptions
Reported expected monthly redemptions
Difference
$330,525.81
$23,333.00
$307,192.81
10/2012
$344,134.75
$23,333.00
$320,801.75
09/2012
$338,930.30
$23,333.00
$315,597.30
08/2012
$320,269.62
$23,333.00
$296,936.62
07/2012
$331,932.59
$23,333.00
$308,599.59
06/2012
$315,867.62
$23,333.00
$292,534.62
05/2012
$289,723.15
$23,333.00
$266,390.15
04/2012
$292,545.28
$23,333.00
$269,212.28
03/2012
$293,100.57
$23,333.00
$269,767.57
02/2012
$245,968.65
$23,333.00
$222,635.65
Total:
$3,102,998.34
$233,330.00
$2,869,668.34
In addition to the high volume of SNAP benefits redemptions, law enforcement agents verified the fraudulent exchange of SNAP benefits for cash through the use of a cooperating witness and an undercover law enforcement officer. During a series of five transactions from June 7, 2012, through Oct. 4, 2012, law enforcement agents directed a cooperating witness and an undercover law enforcement officer to go into Eddies Grocery and exchange $1,359.75 in SNAP benefits for $650 cash.
A review of the bank records for the Eddies Grocery account showed total cash withdrawals from the account for the calendar year of 2012 of $3,109,776. In addition, records from February 15, 2012, (when defendant Alexander Vargas was added as an authorized cosigner on the account) through December 2012, showed $2,548,510 in cash withdrawals – of which Vargas’ name was on 40 withdrawals totaling $1,869,266.The charge of theft of United States funds is punishable by a maximum potential penalty of 10 years in prison and a fine of $250,000.
U.S. Attorney Fishman credited special agents of the U.S. Department of Agriculture, Office of Inspector General, under the direction of Special Agent in Charge William G. Squires Jr. in New York; the Department of Homeland Security, Homeland Security Investigations, under the direction of Special Agent in Charge Andrew McLees; and IRS – Criminal Investigations, under the direction of Special Agent in Charge Shantelle P. Kitchen, with the investigation leading to today’s arrest.
The government is represented by Assistant U.S. Attorney Diana Carrig of the U.S. Attorney’s Office in Camden.
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Vargas, Alexander Complaint
Brooklyn, N.Y., Man Charged with Bank RobberyRead the Press Release
NEWARK, N.J. – A Brooklyn, N.Y., man who was arrested in April in connection with a Bergen County bank robbery will make his initial court appearance today, U.S. Attorney Paul J. Fishman announced.
John Edward Stevens, 59, is charged by Complaint with one count of bank robbery and is scheduled to make his initial appearance before U.S. Magistrate Judge Madeline Cox Arleo in Newark federal court today. Stevens was on the FBI’s 10 Most Wanted Fugitives List in 1988 in connection with unrelated robberies.According to documents filed in this case and statements made in court:
On April 15, 2013, Stevens allegedly robbed the TD Bank, located in Oakland, N.J. According to bank employees and video surveillance, a male wearing a blue jacket and a baseball hat entered the bank and approached one of the bank tellers. The robber was carrying a zipper pouch, which he opened and showed the teller. Inside was what appeared to be a black handgun. The robber fled after the teller gave him money.
Approximately 20 minutes after the robbery, law enforcement stopped a vehicle that was reported stolen. The driver of the stolen vehicle was identified as Stevens. Law enforcement arrested Stevens and located a TD Bank bag filled with money in the vehicle.
If convicted of the bank robbery charge, Stevens faces 20 years imprisonment and a $250,000 fine.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford, with the investigation. He also thanked the Waldwick Police Department and the Oakland Police Department for their contribution to the case.The government is represented by Assistant U.S. Attorney Danielle M. Corcione of the U.S. Attorney’s Office General Crimes Unit in Newark.
The charges and allegations contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
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Stevens Complaint
Brooklyn, N.Y., Man Charged with Bank RobberyRead the Press Release
NEWARK, N.J. – A Brooklyn, N.Y., man who was arrested in April in connection with a Bergen County bank robbery will make his initial court appearance today, U.S. Attorney Paul J. Fishman announced.
John Edward Stevens, 59, is charged by Complaint with one count of bank robbery and is scheduled to make his initial appearance before U.S. Magistrate Judge Madeline Cox Arleo in Newark federal court today. Stevens was on the FBI’s 10 Most Wanted Fugitives List in 1988 in connection with unrelated robberies.According to documents filed in this case and statements made in court:
On April 15, 2013, Stevens allegedly robbed the TD Bank, located in Oakland, N.J. According to bank employees and video surveillance, a male wearing a blue jacket and a baseball hat entered the bank and approached one of the bank tellers. The robber was carrying a zipper pouch, which he opened and showed the teller. Inside was what appeared to be a black handgun. The robber fled after the teller gave him money.
Approximately 20 minutes after the robbery, law enforcement stopped a vehicle that was reported stolen. The driver of the stolen vehicle was identified as Stevens. Law enforcement arrested Stevens and located a TD Bank bag filled with money in the vehicle.
If convicted of the bank robbery charge, Stevens faces 20 years imprisonment and a $250,000 fine.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford, with the investigation. He also thanked the Waldwick Police Department and the Oakland Police Department for their contribution to the case.The government is represented by Assistant U.S. Attorney Danielle M. Corcione of the U.S. Attorney’s Office General Crimes Unit in Newark.
The charges and allegations contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
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Stevens Complaint
Bergen County, N.J., Woman Indicted in $2 Million Mortgage Fraud SchemeRead the Press Release
NEWARK, N.J. – A Bergen County, N.J., woman was indicted today for her role in a long-running, large-scale mortgage fraud scheme that caused millions of dollars in losses, U.S. Attorney Paul J. Fishman announced.
Klary Arcentales, 44, of Lyndhurst, N.J., was charged in a five-count Indictment with one count of conspiracy to commit bank fraud and four counts of bank fraud, all of which caused losses of at least $2 million.
According to the Indictment and other documents filed in this case:
As early as 2006, Arcentales engaged in a mortgage fraud conspiracy through a company called Premier Mortgage Services (PMS). Arcentales, a loan officer at PMS, provided fraudulent documents to financial institutions in connection with mortgage loan applications on behalf of “straw buyers” to induce those financial institutions to fund mortgage loans. Relying upon those false documents, financial institutions funded mortgage loans. Arcentales then profited illegally by receiving a commission from PMS for each mortgage loan that she closed and also profited illegally by diverting portions of the fraudulently-obtained mortgage proceeds for herself.
Conspirator Lester Soto, 56, previously charged by Complaint, was a part-owner of PMS. He also acted as a loan officer on certain PMS mortgage loan applications. Soto took a percentage of PMS’s profits. Soto employed document makers to create fraudulent documents in furtherance of the scheme and put loan officers at PMS, including Arcentales, in contact with these document makers to create other false and fraudulent documents.Conspirator Linda Cohen, 55, previously charged by Complaint, was a paralegal who closed transactions on behalf of a licensed New Jersey attorney. Cohen served as the settlement agent on mortgage loans brokered by Arcentales for various properties. Cohen convened closings, received funds from lenders, and prepared HUD-1 forms – which itemize services and fees charged to borrowers for mortgage loans – that purported to reflect the sources and destinations of funds for mortgages on subject properties. In fact, the HUD-1s were neither true nor accurate. At or following the closings, Cohen disbursed mortgage loan proceeds directly to PMS, herself, and others, including in amounts not reflected on the HUD-1s. Cohen received a fee for each fraudulent loan in which she participated.
Conspirator Antonio Pimenta, 45, previously charged by Complaint, owned and managed Kelmar Construction Co., which built properties that were then sold to straw buyers utilizing fraudulent mortgage loans brokered by Arcentales.
The Indictment charges Arcentales with one count of bank fraud conspiracy and four counts of bank fraud, each punishable by a maximum potential penalty of 30 years in prison and a fine of $1,000,000.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford; special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen, for the investigation leading to today’s charges. Fishman also thanked the Social Security Administration-Office of Inspector General, under the direction of Special Agent in Charge Edward Ryan, for its participation in the investigation.The government is represented by Assistant U.S. Attorneys Rahul Agarwal of the U.S. Attorney’s Office General Crimes Unit and Zach Intrater of the Economic Crimes Unit in Newark.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.stopfraud.gov.
The charges and allegations contained in the Indictment and Complaints are merely accusations, and the defendants are presumed innocent unless and until proven guilty.13-200
Defense counsel:
Arcentales: Ronald Ricci Esq., Woodland Park, N.J.
Soto: Jeff Smith Esq., of Teaneck, N.J.
Cohen: Brian Daly Esq., of Middletown, N.J.
Pimenta: Linda Foster Esq., Assistant Federal Public Defender, NewarkArcentales Indictment
Three Arrested, Charged in New Jersey for Multimillion-Dollar Fraud Offering Phony “pre-ipo” Facebook SharesRead the Press Release
One Conspirator Allegedly Committed Crimes While Federally Indicted in Unrelated Scam
NEWARK, N.J. – Federal law enforcement officers with the FBI and IRS-Criminal Investigationarrested three menat their homesthis morning on charges they stole approximately $6.7 million from an investor, in part by claiming special access to shares in the social media company Facebook Inc., prior to the company’s initial public offering, New Jersey U.S. Attorney Paul J. Fishman announced.
One of the men, Eliyahu Weinstein, 37, of Lakewood, N.J., faces additional charges for allegedly committing the fraud while under federal indictment in New Jersey for a separate real estate investment scheme.
Weinstein, Alex Schleider, 47, of Lakewood, and Aaron Muschel, 63, of Brooklyn, N.Y., are expected to appear on the charges this afternoon before U.S. Magistrate Judge Madeline Cox Arleo in Newark federal court.
“According to the charges, the defendants took advantage of the buzz around the Facebook IPO to fleece unsuspecting investors,” said U.S. Attorney Fishman. “Shamelessly, Eliyahu Weinstein allegedly committed these crimes while under federal indictment for another investment scheme, even using stolen money to pay his legal fees. Today’s arrest should put an end to his brazen conduct.”
“Today’s charged conduct is another example of the cautionary tale that if an opportunity seems to be too good to be true, it probably isn’t,” said FBI Special Agent in Charge Aaron T. Ford. “More than ever, the investing public must exercise the appropriate amount of due diligence before investing with new or unknown entities. This is highlighted by the fact that one of today’s charged individuals is currently awaiting sentencing on a previous fraud conviction.”
According to the complaint in this case and other documents filed in court:
In February of 2012, Weinstein and his fellow conspirators offered investors the opportunity to purchase large blocks of Facebook shares prior to the company’s IPO in May 2012. The offer was particularly attractive because large blocks of the shares were extremely difficult to get, and they were expected to increase in value at the time of the IPO. Weinstein, Schleider and Muschel did not actually have access to the shares.
Based on misrepresentations by Weinstein, Schleider, Muschel and another conspirator, an investor victim – described in the complaint as “G.C.” – wired millions of dollars between February and March of 2012 to an account Weinstein and a conspirator controlled. Weinstein and Schleider convinced G.C. to send the money by, among other things, providing the victim with false documents showing companies owned by various conspirators held assets which would secure G.C.’s investment.
The conspirators did not use any of G.C.’s money to purchase Facebook shares, instead misappropriating it for their own use and benefit by moving it through various accounts. Weinstein used some of the money to pay lawyers and experts representing him in his pending criminal case and in pending civil matters. Weinstein, Schleider and Muschel also used G.C.’s money to make investments in a number of different businesses unrelated to Facebook, and to make loans for their own benefit.
Throughout the scheme, Weinstein was under indictment and on pretrial release, and was prohibited from engaging in any monetary transaction for more than $1,000 without the approval of court-appointed special counsel. Weinstein pleaded guilty in January 2013, before U.S. District Judge Joel A. Pisano in Trenton, N.J., to two counts of that indictment, admitting he ran a real estate investment fraud scheme that caused $200 million in losses and then laundered the proceeds of the scheme.Weinstein, Schleider and Muschel are variously charged in the 13-count complaint unsealed today. The charges against each and the maximum potential penalty per count are as follows:
Count(s)
Charge
Charged Defendants
Maximum Potential Penalty/Count
wire fraud conspiracy
Weinstein, Schleider, Muschel
20 years in prison; $250,000 fine, or twice the gain or loss from the offense
2 – 6
wire fraud while on pretrial release
Weinstein
30 years in prison (10 years consecutive to 20 years for wire fraud);
$250,000 fine, or twice the gain or loss from the offense7 – 13
transacting in criminal proceeds
Weinstein, Muschel
10 years in prison; $250,000 fine, or twice the gain or loss from the offense
Additionally, the government is seeking the seizure and forfeiture of all funds fraudulently obtained by the defendants, including three pieces of real property allegedly maintained with the proceeds of the scheme.
U.S. Attorney Fishman praised special agents of the FBI, under the direction of Special Agent in Charge Ford in Newark, for their work leading the investigation of this case. He also credited special agents of IRS–Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen, for their important contributions.
The government is represented by Counsel to the U.S. Attorney Rachael A. Honig; Assistant U.S. Attorneys Gurbir S. Grewal and Zach Intrater of the U.S. Attorney’s Office Economic Crimes Unit; and Evan S. Weitz of the Office’s Asset Forfeiture and Money Laundering Unit.
The charges and allegations against the defendants are merely accusations, and they are considered innocent unless and until proven guilty.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.stopfraud.gov.
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Defense counsel:
Eliyahu Weinstein: Henry E. Klingeman Esq., Newark; Mark D. Harris Esq., New York
Alex Schleider: Andrew Citron Esq., Forest Hills, N.Y.
Aaron Muschel: James T. Moriarty Esq., New York
Weinstein, Eliyahu et al. Complaint
South Carolina Man Sentenced to 10 Years in Prison for Transporting Stolen Weapons into New JerseyRead the Press Release
Cache Included Military-Style Assault Rifles, Handguns and Shotgun
NEWARK, N.J. – A South Carolina man was sentenced today to 120 months in prison for his role in transporting into New Jersey 22 firearms that were stolen from gun shops in Tennessee and North Carolina, U.S. Attorney Paul J. Fishman announced.
Bevan Holston, 41, of Columbia, S.C., previously pleaded guilty before U.S. District Judge Susan D. Wigenton to an Information charging him with one count of transporting stolen firearms in interstate commerce. Judge Wigenton imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
On March 7, 2012, Bassir Baxter, 40, of Columbia, S.C., Cedric Reddick, 20, and, his father, Holston allegedly drove from South Carolina to the apartment of Terrell James, 23, of Newark, to illegally sell the firearms. All four were charged by Complaint with transporting stolen firearms in interstate commerce.
The four men allegedly entered the apartment, where there were approximately 10 other individuals, and displayed firearms on the floor for the potential buyers. In total, 22 guns were recovered, including semi-automatic handguns and military-style assault rifles. Twenty had been stolen March 1, 2012, from a gun shop in Bristol, Tenn. Two of the guns had been stolen Feb.16, 2012, from a gun shop in Boone, N.C. Police arrested James and Baxter inside the apartment. Reddick and Holston were arrested after jumping to a rooftop from the kitchen window.
In addition to the prison term, Judge Wigenton sentenced Holston to three years of supervised release. The other three defendants are awaiting sentencing.
U.S. Attorney Fishman credited special agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Thomas J. Cannon; special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark; the Essex County Prosecutor's Office, under the direction of Acting Prosecutor Carolyn A. Murray; and the Newark Police Department, under the direction of Director Samuel DeMaio and Police Chief Sheilah Coley, with the investigation leading to today’s sentence.The government is represented by Assistant U.S. Attorney José R. Almonte of the U.S. Attorney's Office Narcotics/OCDETF Unit.
Defense counsel: Stephen Dratch Esq., Livingston
13-198Passaic County Man Admits Role in Long-Running, International Counterfeit Goods Trafficking SchemeRead the Press Release
Forfeits $200,000 in Ill-Gotten Gains to the United States
NEWARK, NJ – A Passaic County, N.J., man today admitted participating in a multi-year, international conspiracy to traffic in counterfeit goods, U.S. Attorney Paul J. Fishman announced.
Aref Abuhadba, 49, of Totowa, N.J., pleaded guilty before U.S. District Judge Dennis M. Cavanaugh to an Information charging him with one count of conspiring to traffic in counterfeit goods. As part of his guilty plea, Abuhadba presented the government with a check for $200,000 today, representing his ill-gotten gains from his involvement in the conspiracy.
According to documents filed in this case and statements made in court:From 2003 through 2010, Abuhadba and others conspired to import counterfeit Nike sneakers and counterfeit Walt Disney-brand comforters and blankets from the People’s Republic of China (PRC) for resale in the United States. Abuhadba worked in concert with a conspirator in the PRC, who acted as a middleman between the manufacturers of counterfeit goods in the PRC and Abuhadba in the United States. The conspirator purchased counterfeit goods from manufacturers in the PRC and arranged for them to be shipped various ports of entry within the United States. Once the containers arrived, other conspirators arranged for them to be delivered to warehouses and other locations throughout the United States controlled by Abuhadba, who would then distribute the counterfeit goods to customers throughout the United States.
Abuhadba was also responsible for collecting money from customers and wiring the proceeds of the scheme to the conspirators. For his participation, Abuhadba received a fee of up to $42,000 for each container that was successfully imported into the United States. If a container was seized by law enforcement, however, Abuhadba was sometimes responsible for a portion of the costs of the goods in the seized container.
According to e-mails reviewed by law enforcement during the investigation, in late 2008, a number of containers with contents valued in the millions of dollars were seized by U.S. Customs and Border Protection (CBP). On Sept. 17, 2008, CBP agents inspected a container at Los Angeles/Long Beach Seaport in Long Beach, Calif., destined for Abuhadba in New Jersey. There were more than 10,000 pairs of counterfeit Nike Air Force One sneakers, bearing various Nike trademarks in the container. The approximate cost of the goods seized was approximately $200,000, and their approximate retail value was $1.5 million. Following the 2008 seizures, Abuhadba exchanged numerous e-mails with the PRC conspirator discussing the seizures and encouraged the PRC conspirator to send false letters to the CBP concerning the seizures, stating that the seized containers were delivered by mistake and were not intended for Abuhadba.
The count to which the defendant pleaded guilty is punishable by a maximum penalty of five years in prison and a fine of up to $250,000, or twice the gross amount of any pecuniary gain derived from the offense, or pecuniary loss sustained by any victims of the offense. Sentencing is scheduled for Sept. 9, 2013.
U.S. Attorney Fishman praised special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark, for the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Gurbir S. Grewal of the U.S. Attorney’s Office Economic Crimes Unit in Newark.
13-193Defense counsel: Edward Bilinkas and Sara Sencer McCardle Esqs., Randolph, N.J.
Abuhadba, Aref Information
Owner of New Jersey Aircraft Parts Brokerage Company Arrested, Charged with Laundering Scrapped Jet Engine PartsRead the Press Release
NEWARK, N.J. – The owner of an aircraft parts broker in Ridgefield, N.J., will appear in Newark federal court today following his arrest last night for an alleged conspiracy to launder scrapped jet engine parts, U.S. Attorney Paul J. Fishman announced.
Gideon Vaisman, 73, of Edgewater, N.J., the sole owner of Tara Technology Corp. in Ridgefield, is charged in a criminal complaint with one count of conspiracy to commit wire fraud. He will appear on the charges this afternoon before U.S. Magistrate Judge Madeline Cox Arleo.
According to the complaint unsealed upon Vaisman’s arrest:
Vaisman orchestrated a scheme, from April 2005 to May 2013, to defraud Federal Aviation Administration (FAA) repair stations, aircraft parts brokers, aircraft parts end-users and others by using phony documents to resell jet engine parts obtained from scrap metal dealers.
Among other things, Vaisman instructed Tara Technology’s general manager, Carmine Coviello, 61, to use his Suffern, N.Y.-based aircraft parts broker and seller company, Shelby Enterprises, to purchase vital jet engine parts called “blades” and “vanes” from scrap metal dealers. Once Coviello purchased the blades and vanes, he had them cleaned, sanded and inspected at a metal shop to conceal that they had been scrapped and on occasion rejected for repair by an FAA repair station. He did this at Vaisman’s direction and in violation of FAA regulations, which mandate that only FAA-certified repair stations or certified airframe and power plant mechanics may perform such work on aircraft parts.
Also at Vaisman’s direction, Coviello conducted sham sales of the illegally altered blades and vanes to Tara Aviation, Ltd., an aircraft parts broker and seller – incorporated in Tortola, British Virgin Islands, and located in Guernsey, United Kingdom – which was controlled and financed by Vaisman. The sole purpose of these sales, which occurred only on paper, was to generate fraudulent trace paperwork for the parts. The parts never left New Jersey. Trace paperwork documents the history of an aircraft part and includes information such as the part’s manufacturer, the aircraft on which the part was used and how it was used. The paperwork is also employed in determining whether an aircraft or aircraft part has been subject to severe stress or heat as would occur during a major engine failure, accident or fire.
Vaisman, Coviello and a sales representative stored the blades and vanes in Tara Technology’s warehouse inventory, ultimately selling them to aircraft brokers, airlines and others on behalf of Tara Aviation using the fraudulent trace paperwork.
The count with which Vaisman is charged carries a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense.
Coviello previously pleaded guilty, before U.S. District Judge Mary L. Cooper, to an information charging him with conspiracy to commit wire fraud in relation to the scheme. His sentencing is scheduled for Sept.12, 2013.
U.S. Attorney Fishman credited special agents of the U.S. Department of Transportation, Office of the Inspector General, under the direction of Special Agent in Charge Douglas Shoemaker; IRS-Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen; and criminal investigators with the U.S. Attorney’s Office with the ongoing investigation.
The government is represented by Assistant U.S. Attorney Scott B. McBride of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark.The charge and allegations against Gideon are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
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Defense counsel: Edward J. Dauber Esq., NewarkVaisman, Gideon Complaint
Camden County, N.J., Man Sentenced to 10 Years in Prison for Conspiring to Distribute 13 Kilograms of CocaineRead the Press Release
CAMDEN, N.J. – A Camden County, N.J., man was sentenced today to 120 months in prison for attempting to purchase 13 kilograms of cocaine for distribution in and through New Jersey, U.S. Attorney Paul J. Fishman announced.
Jamal Herrin, 40, previously pleaded guilty before U.S. District Judge Joseph H. Rodriguez to an Information charging him with one count of knowingly and intentionally conspiring to distribute and possess with intent to distribute more than five kilograms of cocaine. Judge Rodriguez imposed the sentence today in Camden federal court.
According to documents filed in this case and statements made in court:
The investigation into Herrin began in April 2012, when the U.S. Drug Enforcement Administration learned that Herrin – who was on bail pending state murder charges – was interested in purchasing large quantities of cocaine. Herrin admitted that he negotiated the purchase of 13 kilograms of cocaine and amassed more than $325,000 to purchase the cocaine.
In addition to the prison term, Judge Rodriguez sentenced Herrin to five years of supervised release.
U.S. Attorney Fishman credited special agents of the Drug Enforcement Administration’s Camden Resident Office, under the direction of Acting Special Agent in Charge Robert G. Koval in Newark; the Camden County Prosecutor’s Office; the Rowan University Police Department; the Winslow Township Police Department; the Gloucester County Prosecutor’s Office; and local law enforcement agencies in support of the Camden division of the Philadelphia-Camden High Intensity Drug Trafficking Areas task force.The government is represented by Assistant U.S. Attorney Alyson M. Oswald of the U.S. Attorney’s Office Criminal Division in Camden.
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Defense counsel: Brian J. McMonagle Esq., PhiladelphiaCalifornia Man Sentenced to Prison, Ordered to Pay $1.5 Million for Scheme That Swindled New Jersey InvestorsRead the Press Release
TRENTON, N.J. – A man who perpetrated a million-dollar investment fraud from California that defrauded New Jersey victims was sentenced today to 46 months in prison for crimes related to the scheme, U.S. Attorney Paul J. Fishman announced.
Robert Schroy, 68, of Placentia, Calif., previously pleaded guilty to a criminal information charging him with one count each of wire fraud and tax evasion. U.S. District Judge Joel A. Pisano, who accepted the plea, also imposed the sentence today in Trenton federal court.
According to documents filed in the case and statements made in court:
From 2004 through 2009, Schroy solicited people to invest in an alleged “international bank trade.” He admitted that he and fellow conspirators falsely promised prospective investors extraordinary gains – ranging between 10 and 100 percent per week for a minimum period of 25 weeks – plus the return of their principal investment. Based on Schroy’s misrepresentations, numerous investors, including investors in New Jersey, wired investment monies to accounts controlled by Schroy and others. Although the money was wired to the designated accounts, Schroy admitted it was not invested in any bank trade. Instead, he and other conspirators used it for personal expenditures, including automobiles, vacations and meals at restaurants. In total, Schroy admitted they misappropriated at least $1 million in investor money.
In pleading guilty to the tax evasion count, Schroy specifically admitted he failed to file a 2007 U.S. Individual Income Tax Return and failed to report $479,566 of taxable income, upon which an additional tax of $151,781 was owed to the IRS.
In addition to the prison term, Judge Pisano sentenced Schroy to serve three years of supervised release and ordered him to pay $1,540,044 in restitution.
U.S. Attorney Fishman praised special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford, IRS-Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen, and the N.J. Bureau of Securities, under the direction of Bureau Chief Abbe R. Tiger, for their work in the investigation.
The government is represented by Deputy Chief Christopher J. Kelly of the U.S. Attorney’s Office Economic Crimes Unit in Newark.This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.stopfraud.gov.
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Defense counsel: Joshua Markowitz Esq., Lawrenceville, N.JUnion Official from Jersey City Local Sentenced to Six Months in Prison for Embezzling MoneyRead the Press Release
NEWARK, N.J. – The president of Local 148 of the Production Workers Union was sentenced today to six months in prison for conspiring with the secretary-treasurer/recording secretary to steal money from the union by taking unauthorized salary increases and bonuses, U.S. Attorney Paul J. Fishman announced.
Stephen P. Arena, 58, of Nesconset, N.Y., previously pleaded guilty before U.S. District Judge Stanley R. Chesler to Count One of a 24-count Indictment, which charged Arena with conspiracy to embezzle money and funds from Local 148. Judge Chesler imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
Local 148 of the Production Workers Union of the Allied, Novelty, and Production Workers of America, located in Jersey City, N.J., represents workers from various trades, including bus drivers, hotel workers, and factory workers.
Arena, the union’s president, and David J. Caivano, its secretary-treasurer/recording secretary, conspired to embezzle money belonging to Local 148 by giving themselves unauthorized salary increases and bonuses with no legitimate union purpose and which had not been authorized by the union or its members. Arena admitted he conspired with Caivano to embezzle money from the union.
Caivano pleaded guilty before Judge Chesler to unlawfully engaging in a financial transaction with a labor union and was sentenced to three years of probation.In addition to the prison term, Judge Chesler sentenced Arena to two years of supervised release and fined him $5,000. Arena’s plea agreement also requires him to repay the union approximately $110,000 in restitution.
U.S. Attorney Fishman credited special agents of the U.S. Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, under the direction of Special Agent in Charge Robert L. Panella; investigators from the U.S. Department of Labor, Office of Labor Management Standards, New York District Office, under the direction of District Director Andriana Vamvakas, with the investigation leading to today’s sentence.
The government is represented by Assistant U.S. Attorney Anthony Moscato of the U.S. Attorney Office’s Organized Crime/Gangs unit, in Newark.
13-192Defense counsel: Nicholas G. Kaizer Esq., New York
Organizer of International Securities Fraud Ring Sentenced to Prison for Using Hackers to Falsely Inflate Stock PricesRead the Press Release
TRENTON, N.J. – The central organizer of a worldwide conspiracy to manipulate stock prices through a “botnet” network of virus-controlled computers was sentenced today in Trenton federal court to 71 months in prison, New Jersey U.S. Attorney Paul J. Fishman announced.
Christopher Rad, 44, of Cedar Park, Texas, was previously convicted, following a 9-day jury trial, of six counts arising from the fraud scheme: conspiring to further securities fraud using spam; conspiring to transmit spam through unauthorized access to computers; and four counts of transmission of spam by unauthorized computers.
The sentence was imposed by U.S. District Judge Joel A. Pisano, who also presided over the trial.
“Christopher Rad’s use of hackers to drive his pump-and-dump scheme illustrates a trend toward the modern mechanization of old-school scams,” said U.S. Attorney Fishman. “Law enforcement is constantly anticipating and adapting as criminals operate in a more virtual – and more global – world. As a result, Rad will spend years in prison for manipulating our markets to steal his millions.”
According to documents filed in this case and statements made in court:
Rad conspired with stock promoters in a scheme to manipulate the price and volume of dozens of particular stocks, including stocks with ticker symbols RSUV, QRVS, VSHE, SVXA and ASIC, in order to later sell them at an artificially inflated price – a practice known as a “pump and dump” scheme. The scheme began as early as November 2007 and continued through February 2009.
As part of the scheme, Rad organized others to manipulate the stock prices. He sought out and engaged spammers, then sent them precise language to include in their spam campaigns.
The spammers included two individuals who distributed spam through botnets. To create a botnet, viruses were sent out to infect computers around the world, creating a virtual army of hijacked computers. The spammers then caused the botnets to distribute spam to promote the stocks Rad wanted to manipulate. Infected computers were found in New Jersey, Europe, Russia and elsewhere. The botnet was controlled from command and control servers located overseas, including in Russia and China.
Rad, who went by the alias “billy_sack,” communicated with the spammers by Skype, in most instances knowing them only by their aliases. During the 22-month conspiracy, Rad paid the spammers more than $1.4 million, making payments through e-Gold and money wires. Payments intended for a botnet operator in Russia were made through at least eight different countries. The wire instruction notations included false information such as payments for “Dell Monitors,” “touch panels” and “transportation services.”
Rad also agreed with others to engage in bad-faith purchases of RSUV to create the impression among spam recipients that there was active trading in the stock.
At the same time, hackers hacked into the brokerage accounts of third parties, liquidated the stocks in those accounts, then used the accounts to purchase shares of some of the stocks the scheme sought to manipulate. This increased the volume of shares being traded and created an impression that the stocks were worth purchasing.In all, Rad made approximately $2.8 million from his schemes.
In addition to the prison term, Judge Pisano sentenced Rad to serve five years of supervised release and ordered him to pay a $30,000 fine. Restitution will be determined at a later date.
Rad’s coconspirators, Doyle Scott Elliott and James Bragg, previously pleaded guilty to securities fraud and transmission of spam through falsely registered e-mail addresses. They await sentencing.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark, with the investigation. He also thanked the U.S. Securities and Exchange Commission’s Division of Enforcement, led by Acting Director George Canellos.
The government is represented by Assistant U.S. Attorney Andrew S. Pak, of the Computer Hacking and Intellectual Property Section of the U.S. Attorney’s Office Economic Crimes Unit (ECU); Christopher J. Kelly, Deputy Chief of the ECU; and Erez Liebermann, Deputy Chief of the Office’s Criminal Division in Newark.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF), which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
13-191Defense counsel: Francis Montenegro Esq., Austin, Texas
Man Who Recorded Girls with Hidden Camera Sentenced to 15 Years in Prison for Production of Child PornographyRead the Press Release
CAMDEN, N.J. – A Morris County, N.J., man was sentenced today to 180 months in prison for using hidden cameras to record young girls in his home, U.S. Attorney Paul J. Fishman announced.
Ronald Oshrin, 50, of Budd Lake, N.J., previously pleaded guilty before U.S. District Judge Joseph H. Rodriguez, to an Information charging him with one count of production of child pornography. Judge Rodriguez imposed the sentence today in Camden federal court.
According to documents filed in this case and statements made in court:
Oshrin admitted that between 2007 and April 2012, he installed hidden cameras in a bedroom and a bathroom of his home in order to record nine young girls in various states of undress. Oshrin edited the videos to produce still photographs and, during that time period, distributed the videos and the still photographs over the Internet. He also admitted to sexual contact with certain minors.
U.S. Attorney Fishman credited special agents of the FBI Newark Division’s Cyber Crime Task Force, under the direction of Special Agent in Charge Aaron T. Ford, and the Mount Olive Police Department, under the direction of Chief Mark Spitzer, for the investigation leading to the charge. He also thanked the Morris County Prosecutor’s Office for their role in the investigation.
In addition to the prison term, Judge Rodriguez sentenced Oshrin to 10 years of supervised release.The government is represented by Assistant U.S. Attorney Robert Frazer, Chief of the General Crimes Unit, and Assistant U.S. Attorney Elizabeth M. Harris of the U.S. Attorney’s Office General Crimes Unit in Newark.
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Defense counsel: James Patton Esq., Livingston, N.J.Hudson County, N.J., Man Admits Paying Bribes for $3.5 Million Line of CreditRead the Press Release
TRENTON, N.J. – A Hudson County, N.J., man today admitted his role in paying bribes valued at $49,000 to a bank officer at Mariner’s Bank in Edgewater, N.J., to renew a $3.5 million line of credit, U.S. Attorney Paul J. Fishman announced.
Rolando Cribeiro, 49, of North Bergen, N.J., pleaded guilty before U.S. District Judge Peter G. Sheridan in Trenton federal court to an Information charging him with one count of bank bribery.
According to documents filed in this case and statements made in court:
Cribeiro was the owner of CP Building Corp., a/k/a C&P Floor Covering Inc., a/k/a C&P Building Enterprises, a/k/a Roly’s Carpet, a general contracting company located in West New York, N.J.
In 2008, Cribeiro was financially unqualified to renew a previously approved $3.5 million line of credit with Mariner’s Bank. Cribeiro made multiple payments to a bank officer who was assigned responsibility for Cribeiro’s line of credit. The corrupt payments were made in exchange for the bank officer renewing and continuing the line of credit. Cribeiro gave the bank officer a check for $6,500 and cash payments of approximately $5,000 and $3,500. Cribeiro also provided the bank officer with a rent-free apartment in Cribeiro’s apartment building in Newark, relieving the bank officer of approximately $35,000 in rent payments.
The bank bribery charge carries a maximum potential penalty of 30 years in prison and a maximum fine of $1 million. Sentencing is currently scheduled for Sept. 5, 2013.U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark, and criminal investigators from the U.S. Attorney’s Office in Newark, with the continuing investigation leading to the guilty plea.
The government is represented by Assistant U.S. Attorney Zahid N. Quraishi of the U.S. Attorney’s Office Special Prosecutions Division in Newark.
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Defense counsel: Arthur P. Zucker Esq., Hackensack, N.J.Cribeiro Information
Monmouth County, N.J., Man Admits Distributing Images of Child Sexual AbuseRead the Press Release
TRENTON, N.J. - A Monmouth County, N.J., man today admitted using a computer in his home to distribute images of child sexual abuse, U.S. Attorney Paul J. Fishman announced.
Nathan Brochstein, 40, of Wayside, N.J., pleaded guilty today before U.S. District Judge Mary L. Cooper in Trenton federal court to an information charging him with one count of distribution of child pornography.
According to documents filed in this case and statements made in court:
Brochstein admitted making images and videos depicting child sexual abuse available to others on the Internet via peer-to-peer file sharing software. He also admitted possessing more than 600 images of child sexual abuse on his computer and external hard drive, which were seized from his residence in November 2012. Brochstein acknowledged that among the images and videos of child pornography he possessed and distributed were images and videos that portrayed sadistic or masochistic conduct or other depictions of violence and included images of a prepubescent minor.
The count to which Brochstein pleaded guilty carries a mandatory minimum penalty of five years in prison and a maximum potential penalty of 20 years in prison, followed by a mandatory minimum of five years of supervised release and a $250,000 fine. Sentencing is scheduled for Sept. 9, 2014.
U.S. Attorney Fishman credited special agents of Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), Newark Division, under the direction of Special Agent in Charge Andrew M. McLees, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Cari Fais of the U.S. Attorney’s Office General Crimes Unit in Newark.
14-161Defense counsel: Robert Weir Esq., Red Bank, N.J.
Brochstein, Nathan Information
Three Former Employees of Timeshare Consulting Firm Admit Conspiring to Defraud Timeshare OwnersRead the Press Release
CAMDEN, N.J. – Three former employees of The Vacation Ownership Group LLC admitted to conspiring to defraud owners of timeshare properties by offering phony consulting services, U.S. Attorney Paul J. Fishman announced. One of the defendants also admitted to illegally collecting unemployment benefits.
Jeffrey Sawyer, 50, of Mullica Hill, N.J., pleaded guilty today before U.S. District Court Judge Noel L. Hillman in Camden federal court to an Information charging him with one count of conspiracy to commit mail and wire fraud.
Steven Cox, a/k/a “Steve Coluzzi,” 49, of Ventnor, N.J., pleaded guilty on May 7, 2013 before Judge Hillman to a Superseding Information charging him with one count of conspiracy to commit mail and wire fraud.
Eric K. Reiff, a/k/a “Skip,” a/k/a “Skip Ray,” 41, of Ocean City, N.J., pleaded guilty on May 1, 2013, before Judge Hillman to an Information charging him with one count of conspiracy to commit mail and wire fraud and one count of wire fraud.
According to documents filed in these cases and statements made in court:
The Vacation Ownership Group, a/k/a VO Group LLC, had offices in Mays Landing and Egg Harbor Township, N.J., and claimed to offer consulting services to owners of timeshares, including cancelling, purchasing and upgrading the timeshares.
In 2010, the four defendants started working at the VO Group and were trained by VO Group managers to call customers using prepared scripts. The defendants each called customers and gave the customers the false impression that they were working for a bank or lending institution. After hearing defendants’ false representations, some customers sent checks to the VO Group. Reiff falsely told an individual with the initials “SK” that SK could settle all of SK’s timeshare debt for a “one time” price and induced SK to send a check for $21,328.28 to the VO Group. Cox told “NP” that NP could settle his timeshare debt for a large discount by mailing a $26,585 check to the VO Group. Sawyer pretended to be a satisfied VO Group customer to persuade others to send money to the VO Group. Each defendant admitted causing substantial losses: Sawyer admitted causing more than $70,000 in losses; Reiff admitted causing more than $120,000 in losses; and Cox admitted causing more than $200,000 in losses.
Reiff also admitted to devising a separate scheme to defraud the N.J. Department of Labor by collecting unemployment compensation benefits while working at the VO Group. Reiff admitted to applying for and being awarded $12,600 in unemployment compensation benefits to which he was not entitled.
On Jan. 23, 2013, co-owners Adam Lacerda and Ashley Lacerda and other members of the VO Group were charged in a Superseding Indictment with conspiracy to commit mail and wire fraud and other charges. Additional members of the VO Group were also charged by Criminal Complaint in April 2012. As for the Lacerdas and other defendants who have not been
convicted in this case, the charges and allegations against them are merely accusations and they are considered innocent unless and until proven guilty.The mail and wire fraud conspiracy charge to which the three defendants pleaded guilty is punishable by a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gain or loss caused by the offense. The wire fraud charge to which Reiff pleaded guilty is also punishable by a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gain or loss caused by the offense.
Sentencings are scheduled as follows: Sawyer and Cox, Sept. 27, 2013; Reiff, Sept. 20, 2013.
U.S. Attorney Fishman credited special agents from the FBI’s Atlantic City Resident
Agency, under the direction of Special Agent in Charge Aaron T. Ford in Newark; and special
agents from the Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, under the direction of Special Agent in Charge Robert Panella, New York Region, for their roles in the investigation leading to the guilty pleas. He also thanked the N.J. Department of Labor, Benefit Payment Control Unit, for its assistance.The government is represented by Assistant U.S. Attorneys Alyson M. Oswald and R. David Walk, Jr. of the U.S. Attorney’s Office Criminal Division in Camden.
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Defense counsel:
Reiff: Troy Archie Esq., Cinnaminson, N.J.
Sawyer: Mark E. Roddy Esq., Pleasantville, N.J.
Cox: Jeffrey M. Miller Esq., PhiladelphiaReiff Information
Sawyer Information
Cox Superseding InformationPassaic County, N.J., Man Charged with Possession of Child PornographyRead the Press Release
NEWARK, N.J. – A Passaic County, N.J., man was arrested today after law enforcement officers discovered alleged child pornography at his residence, U.S. Attorney Paul J. Fishman announced.
Anthony Chiampi, 48, of Totowa, N.J., is charged by criminal Complaint with one count of possessing images of child sex abuse. Chiampi is scheduled to appear today before U.S. Magistrate Judge Steven C. Mannion in Newark federal court.
According to the criminal Complaint;
Chiampi is a Megan’s Law registrant, having been previously convicted in New Jersey Superior Court, Passaic County, for endangering the welfare of a child. He is subject to community supervision for life. On March 14, 2013, as part of that supervision, N.J. Division of Parole (“N.J. Parole”) officers conducted a home visit and discovered 63 disks that contained alleged images and videos depicting child sexual abuse, including material that involved prepubescent minors.
Because of his prior conviction, Chiampi faces a mandatory minimum penalty of 10 years in prison, a maximum potential penalty of 20 years, and a $250,000 fine.U.S. Attorney Fishman credited the N.J. State Parole Board and special agents of the FBI Newark Division’s Child Exploitation Task Force, under the direction of Special Agent in Charge Aaron T. Ford in Newark, and with the investigation leading to today’s arrest.
The government is represented by Assistant U.S. Attorney Danielle M. Corcione of the U.S. Attorney’s Office General Crimes Unit in Newark.
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Defense counsel:Chiampi, Anthony Complaint
Mercer County, N.J., Man Charged with Possession of Child PornographyRead the Press Release
TRENTON, N.J. – A Mercer County, N.J., man will have his initial court appearance on child pornography charges in New Jersey after having been arrested by local authorities in Panama and returned to the United States in early April, where he was arrested by special agents from the Department of Homeland Security, U.S. Attorney Paul J. Fishman announced.
Fredy Arbito, 31, of Hightstown, N.J., is charged by Complaint with one count of possession of child pornography. He is scheduled to make his initial appearance this afternoon before U.S. Magistrate Judge Tonianne J. Bongiovanni in Trenton federal court.
According to documents filed in this case and statements made in court:
As early as Jan. 28, 2013, Arbito knowingly and willfully possessed at least three images of child pornography, which were produced and transported by computer. Emails of a sexual nature allegedly sent by Arbito to a 14-year-old girl in Ecuador were traced back to an account at Arbito’s address in Hightstown.
The charge of possessing child pornography carries a maximum potential penalty of 10 years in prison and a $250,000 fine. U.S. Attorney Fishman praised special agents of the Department of Homeland Security’s Immigration and Customs Enforcement, Homeland Security Investigations, in New Jersey under the direction of Special Agent in Charge Andrew M. McLees, with the investigation leading to the charges.
The government is represented by Assistant U.S. Attorney R. Joseph Gribko of the U.S. Attorney’s Office Criminal Division in Trenton.
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Defense counsel: David Oakley Esq., Princeton, N.J.Arbito Complaint
Former Newark Police Officer Pleads Guilty to Conspiracy to Commit Section 8 FraudRead the Press Release
NEWARK, N.J. – A former Newark police officer admitted today that he conspired with another individual to fraudulently obtain payments under the federal public housing assistance program known as “Section 8,” U.S. Attorney Paul J. Fishman announced.
Suliaman Kamara, 31, of Newark, pleaded guilty before U.S. District Judge Susan D. Wigenton in Newark federal court to an Information charging him with one count of agreeing with another individual to obtain Section 8 public housing benefits to which they were not entitled.
According to documents filed in this case and statements made in court:
The Section 8 Program is a federal public housing assistance program administered by the U.S. Department of Housing and Urban Development (HUD) to provide rent subsidies to qualified low-income individuals. HUD provided federal grant money to the Newark Housing Authority (NHA) for the Section 8 Program. Under the NHA’s Section 8 Program, a tenant’s rental assistance was based upon the tenant’s anticipated family gross income. Tenants receiving Section 8 assistance from the NHA had to inform the Newark Housing Authority of all the members of the household and the annual household income.
From September 2006 to December 2011, Suliaman Kamara, then a Newark police officer, lived in Newark with another individual (S.L.) who was receiving Section 8 benefits. For most of that time they lived in a property owned by Kamara. They agreed they would not disclose to the NHA that they were living together so that Kamara’s income would not be taken into account in determining whether S.L. qualified for Section 8 benefits. Kamara and S.L. submitted fraudulent information and documents to the NHA where they failed to disclose that Kamara lived with S.L and was earning household income. Kamara and S.L. obtained more than $60,000 in Section 8 benefits to which they were not entitled.
The Information to which Kamara pleaded guilty carries a maximum potential penalty of five years in prison and a $250,000 fine. Sentencing is scheduled for Aug. 12, 2013.
U.S. Attorney Fishman credited special agents of the U.S. Department of Housing and Urban Development, under the direction of Special Agent in Charge Cary Rubenstein, for the investigation of this case.The government is represented by Assistant U.S. Attorney Barbara R. Llanes of the U.S. Attorney’s Office Special Prosecutions Division in Newark.
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Defense counsel: Anthony Iacullo Esq., Nutley, N.J.
Kamara Information
Former Carteret High School Vice Principal Pleads Guilty to Possession of Child PornographyRead the Press Release
TRENTON, N.J. - A Rahway, N.J., man who was the vice principal at Carteret High School admitted today that he possessed child pornography, U.S. Attorney Paul J. Fishman announced.
Nicholas Sysock, 53, pleaded guilty before U.S. District Judge Mary L. Cooper in Trenton federal court to an Information charging him with one count of possession of child pornography.
According to documents filed in this case and statements made in court:Between May 2008 and March 2011, Sysock purchased numerous DVDs that contained video recordings of child pornography from a company in Canada. During a search of Sysock’s residence in October 2012, federal investigators found these DVDs and also found printed images featuring naked children. Sysock was arrested the same day. At the time of his arrest, Sysock was the vice principal of Carteret High School.
The charge to which Sysock pleaded guilty is punishable by a maximum potential penalty of 10 years in prison and a fine of $250,000. Sentencing is scheduled for Aug. 15, 2013.
U.S. Attorney Fishman praised inspectors with the U.S. Postal Inspection Service, under the direction of Inspector Maria L. Kelokates, for the investigation leading to today’s guilty plea.
The Government is represented by Assistant U.S. Attorney David M. Eskew of the U.S. Attorney’s Office General Crimes Unit in Newark.
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Defense counsel: Carol Gillen Esq., Assistant Federal Public Defender, Newark
Sysock Information
Englishtown, N.J., Pharmacy Burgular Admits Conspiracy to Sell Stolen OxycodoneRead the Press Release
TRENTON, N.J. – A Brooklyn, N.Y., man admitted today to his involvement in a plot to burglarize a pharmacy in Englishtown, N.J., and sell stolen narcotics for cash, U.S. Attorney Paul J. Fishman announced.
James Zarbailov, 22, pleaded guilty before U.S. District Judge Freda L. Wolfson in Trenton federal court to an information charging him with one count of conspiracy to distribute and possess with intent to distribute oxycodone.
According to documents filed in this case and statements made in court:
The Union Hill-Supremo Pharmacy in Englishtown was burglarized shortly after 4:00 a.m. on June 17, 2012. Zarbailov and his fellow conspirators filled 17 garbage bags and two cardboard boxes with merchandise from the pharmacy, including approximately 1,988 dosage units of methylphenidate, 500 dosage units of hydromorphone, 300 dosage units of Opana (a trade name for oxymorphone) and 3,800 dosage units of oxycodone – all Schedule II controlled substances.
The stock lost by the pharmacy was valued at approximately $350,000.
During today’s proceeding, Zarbailov admitted that he stole the drugs, and that he did so knowing they would be sold for profit.
The conspiracy to distribute oxycodone charge to which Zarbailov pleaded guilty carries a maximum potential penalty of 20 years in prison and a $1 million fine. Sentencing is scheduled for Aug. 22, 2013.
U.S. Attorney Fishman credited special agents of the FBI’s Red Bank Resident Agency, under the direction of Special Agent in Charge Aaron T. Ford in Newark, and law enforcement officers from the Marlboro Township Police Department, under the direction of Police Chief Bruce E. Hall, for the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Jennifer Davenport of the U.S. Attorney’s Office Criminal Division in Trenton.13-184
Defense counsel: Sanford Talkin Esq., New York
Zarbailov Information
Englishtown, N.J., Pharmacy Burgular Admits Conspiracy to Sell Stolen OxycodoneRead the Press Release
TRENTON, N.J. – A Brooklyn, N.Y., man admitted today to his involvement in a plot to burglarize a pharmacy in Englishtown, N.J., and sell stolen narcotics for cash, U.S. Attorney Paul J. Fishman announced.
James Zarbailov, 22, pleaded guilty before U.S. District Judge Freda L. Wolfson in Trenton federal court to an information charging him with one count of conspiracy to distribute and possess with intent to distribute oxycodone.
According to documents filed in this case and statements made in court:
The Union Hill-Supremo Pharmacy in Englishtown was burglarized shortly after 4:00 a.m. on June 17, 2012. Zarbailov and his fellow conspirators filled 17 garbage bags and two cardboard boxes with merchandise from the pharmacy, including approximately 1,988 dosage units of methylphenidate, 500 dosage units of hydromorphone, 300 dosage units of Opana (a trade name for oxymorphone) and 3,800 dosage units of oxycodone – all Schedule II controlled substances.
The stock lost by the pharmacy was valued at approximately $350,000.
During today’s proceeding, Zarbailov admitted that he stole the drugs, and that he did so knowing they would be sold for profit.
The conspiracy to distribute oxycodone charge to which Zarbailov pleaded guilty carries a maximum potential penalty of 20 years in prison and a $1 million fine. Sentencing is scheduled for Aug. 22, 2013.
U.S. Attorney Fishman credited special agents of the FBI’s Red Bank Resident Agency, under the direction of Special Agent in Charge Aaron T. Ford in Newark, and law enforcement officers from the Marlboro Township Police Department, under the direction of Police Chief Bruce E. Hall, for the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Jennifer Davenport of the U.S. Attorney’s Office Criminal Division in Trenton.13-184
Defense counsel: Sanford Talkin Esq., New York
Zarbailov Information
Union County, N.J., Man Arrested, Charged with Distributing Images of Chilld Sexual AbuseRead the Press Release
NEWARK, N.J. – Law enforcement officers arrested a Union County, N.J., man today after discovering alleged child pornography on his home computer during a search following an undercover investigation, U.S. Attorney Paul J. Fishman announced.
Andrew Johnson, 29, of Cranford, N.J., is charged by complaint with one count of distributing images of child sexual abuse over the Internet. Johnson appeared on the complaint this afternoon before U.S. Magistrate Judge Steven C. Mannion in Newark federal court and was released on a $100,000 bond.
According to the criminal complaint filed today:
On July 3, 2012, Dec. 7, 2012 and April 4, 2013, Johnson distributed videos and images depicting child sexual abuse, on the Internet via peer-to-peer file sharing software, which allowed others access to the material in shared directories. An undercover agent discovered and downloaded the images and videos, and the username and IP address of the sharer was traced back to Johnson’s residence.
Johnson was arrested after FBI special agents executed a search warrant today at his Cranford home.
The possession count carries a minimum penalty of five years in prison, and a maximum potential penalty of 20 years in prison and a $250,000 fine.U.S. Attorney Fishman credited special agents of the FBI, Newark Division’s Child Exploitation Task Force, under the direction of Special Agent in Charge Aaron T. Ford, and the Cranford Police Department with the investigation leading to today’s arrest.
The government is represented by Assistant U.S. Attorney Danielle Alfonzo Walsman of the U.S. Attorney’s Office General Crimes Unit in Newark.
The charge and allegations contained in the complaint are merely accusations, and the defendant is considered innocent unless and until proven guilty.
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Defense counsel: Assistant Federal Public Defender Lorraine Gauli-Rufo Esq., NewarkJohnson, Andrew Complaint