District of New Jersey
Press releases recorded for this federal judicial district.
Brooklyn Business Owner Admits Tax EvasionRead the Press Release
NEWARK, N.J. – A Brooklyn, New York, man admitted underreporting the proceeds of his buyout agreement on his income tax return, U.S. Attorney Philip R. Sellinger for the District of New Jersey and Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division announced today.
David Seruya pleaded guilty on July 28, 2022, before U.S. District Judge Julien X. Neals in Newark federal court charging him with three counts of tax evasion.
According to court documents filed in this case and statements made in court:
From 2009 to 2014, Seruya was an original owner and shareholder of a New Jersey-based home warranty business. In 2014, Seruya entered into a buyout agreement whereby he agreed to sell his shares of stock back to the business and exit the company. In exchange for his stock shares, the home warranty company agreed to pay Seruya $4.1 million, which included a lump sum payment and installment payments spread out over 24 months. Seruya underreported to his return preparer the actual amount of income he received from the sale of his stock. In addition, Seruya did not inform his return preparer about income received from canceled mortgage debt. As a result, Seruya caused his return preparer to prepare and file false income tax returns for the tax years 2014 through 2016. Seruya admitted to evading taxes for calendar years 2010-2013. In total, Seruya’s tax evasion caused a loss to the IRS of more than $1.1 million.
The counts to which Seruya pleaded guilty are each punishable by a maximum of five years in prison and a fine of $100,000, or twice the gross pecuniary gain or loss, whichever is greatest. Sentencing is scheduled for Dec. 14, 2022.
U.S. Attorney Sellinger and Acting Deputy Assistant Attorney General Goldberg credited special agents of IRS - Criminal Investigation, under the direction of Special Agent in Charge Tammy Tomlins in Newark, with the investigation leading to the guilty plea.
The government is represented by Assistant U.S. Attorney Carolyn Silane for the District of New Jersey and Trial Attorney Shawn Noud of the Tax Division.
Cardiologist Sentenced to 30 Months in Prison for Unlawfully Distributing Thousands of Oxycodone PillsRead the Press Release
TRENTON, N.J. – A New Jersey cardiologist was sentenced today to 30 months in prison for unlawfully prescribing thousands of Oxycodone pills, U.S. Attorney Philip R. Sellinger announced.
Raymond Catania, 60, of Warren, New Jersey, previously pleaded guilty by videoconference before U.S. District Judge Michael A. Shipp to an information charging him with dispensing Oxycodone outside of the usual course of professional practice and not for a legitimate medical purpose. Judge Shipp imposed the sentence today in Trenton federal court.
According to documents filed in this case and statements made in court:
Catania was a New Jersey physician specializing in cardiology and practicing in Watchung, New Jersey. From January 2016 through March 2017, Catania issued prescriptions for thousands of Oxycodone pills to one of his patients, and Catania did so without a legitimate medical purpose and outside of the usual course of professional practice. Catania also issued prescriptions for thousands of Oxycodone pills to that patient’s wife even though the wife was not Catania’s patient. Oxycodone – a Schedule II controlled substance – has a high potential for abuse that can lead to severe psychological and physical dependence and can result in fatal overdoses. Catania prescribed more than 8,600 Oxycodone 30 mg pills.
In addition to the prison term, Judge Shipp fined Catania $25,000 and sentenced him to three years of supervised release.
U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney Leslie F. Schwartz, Senior Litigation Counsel, of the Special Prosecutions Division, in Newark.
MS-13 Member Sentenced to 35 Years in Prison for Racketeering Conspiracy Involving MurderRead the Press Release
NEWARK, N.J. – An MS-13 gang member was sentenced today to 420 months in prison for his execution-style killing of a man in 2015, U.S. Attorney Philip R. Sellinger and Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division announced.
Juan Garcia-Gomez, aka “Scooby,” 26, of El Salvador, previously pleaded guilty before U.S. District Judge Claire C. Cecchi to one count of an indictment charging him with racketeering conspiracy. Judge Cecchi imposed the sentence today in Newark federal court.
“Garcia-Gomez committed a brutal and violent crime to gain membership in a criminal organization known for its brutality and violence,” U.S. Attorney Sellinger said. “He wasn’t even out of his teens when he complied with MS-13’s orders and snuffed out another young man’s life, ruining the lives of his victim’s family and friends and ending any chance at a decent life for himself. This sentence will keep this violent criminal off of our streets.”
“Due to the dedicated efforts of the Department of Justice and our law enforcement partners, Garcia-Gomez and his fellow gang members will no longer be able to victimize this community,” Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division said. “The Criminal Division and our law enforcement partners will continue to pursue MS-13 gang members who take the lives of others and prey on the communities through violence and intimidation and will not stop in our pursuit of justice for the victims of this violent gang.”
“Cases like this are a reminder of the deadly brutality involved with drug activity,”Acting Special Agent in Charge Terence Reilly said. "We aggressively pursue MS-13 activity because of the high threat they pose to the citizens of our area. Long prison terms are the one sure method for getting these dangerous criminals off our streets."
According to court documents in this and other cases, and the evidence at the trial of Garcia-Gomez’s co-defendants:
Garcia-Gomez conspired to participate in the illegal activities of Mara Salvatrucha, a violent criminal gang also known as MS-13, founded in Los Angeles and active in numerous states, including New Jersey, as well as in El Salvador, Central America, and Mexico. MS-13 is governed by a core set of rules, including a standing order to kill rival gang members and a strict rule against cooperating with law enforcement. MS-13 is organized into a series of sub-units, or “cliques,” that operate in specific geographic locations, and each clique is typically controlled by a single leader, sometimes known as the “First Word.” Two cliques active in and around Hudson County, New Jersey, were the Pinos Locos Salvatrucha clique, of which Garcia-Gomez was a member/associate, and the Hudson Locos Salvatrucha clique.
In July 2015, Jose Urias-Hernandez, then 19, was shot and killed execution-style by Garcia-Gomez with a single shot to the back of his head as he entered his apartment building. Garcia-Gomez participated in the murder because he was ordered by MS-13 leadership to commit the murder to achieve membership in the gang. The victim was not a rival gang member.
In addition to murder, MS-13 members, including Garcia-Gomez, trafficked drugs and threatened witnesses to prevent cooperation with law enforcement, and others extorted a restaurant operating in the gang’s turf.
In addition to Garcia-Gomez, nine defendants were charged in New Jersey. Christian Linares-Rodriguez, aka “Donkey,” 42, is a high-ranking MS-13 member who is currently incarcerated in El Salvador and is awaiting extradition to the United States; the allegations against him are merely accusations, and he is presumed innocent unless and until proven guilty. All other defendants have been convicted, including Juan Pablo Escalante-Melgar, aka “Humilde,” Elmer Cruz-Diaz, aka “Locote,” and Oscar Sanchez-Aguilar, aka “Snappy,” who were convicted at trial in November 2021 and are awaiting sentencing. At sentencing, Esclante-Melgar, Cruz-Diaz, and Sanchez-Aguilar each face a mandatory minimum sentence of life in prison.
“Garcia-Gomez chose to take a young, innocent life to gain entrance to MS-13, a gang notorious for its senseless violence,” Special Agent in Charge Jason J. Molina for Homeland Security Investigations in Newark said. “With his callous action, he ended a life full of potential. With today’s sentence, he has discovered the consequences of his actions.”
“This senseless murder that took the life of a young man with no ties to gang life is typical of the brutality that we have come to expect from MS-13,” ICE-ERO Newark Field Office Director John Tsoukaris said. “Thanks to the collaborative efforts of local, state and federal law enforcement, justice has been served here as well as the interests of community safety.”
“Mr. Garcia-Gomez deliberately executed a young man with the purpose of terrorizing the North Hudson community, hoping to earn the respect of some of the most dangerous criminals,” Hudson County Prosecutor Esther Suarez said. “Our office appreciates the commitment shared between local, state, and federal law enforcement partners to see that those responsible for violent attacks, such as this, are held accountable to the fullest extent of the law.”
In addition to the prison term, Judge Cecchi sentenced Garcia-Gomez to five years of supervised release.
U.S. Attorney Sellinger and Assistant Attorney General Polite credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark; officers of the Immigration and Customs Enforcement - Enforcement and Removal Operations Newark Field Office, under the direction of Field Office Director John Tsoukaris; special agents of the Department of Homeland Security, Homeland Security Investigations, under the direction of Special Agent in Charge Jason J. Molina in Newark; investigators of the Hudson County Prosecutor’s Office, under the direction of Prosecutor Esther Suarez:, and investigators of the West New York Police Department under the direction of Deputy Chiefs Santiago Cabrera and Alejandro De Rojas, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney Desiree Grace of the District of New Jersey and Trial Attorney Matthew J. Hoff of the Criminal Division’s Organized Crime and Gang Section.
Defense counsel: Anthony Iacullo Esq., Nutley, New Jersey
Naturalized U.S. Citizen Guilty of International Parental KidnappingRead the Press Release
CAMDEN, N.J. – A naturalized U.S. citizen who had been living in India was convicted of obstructing the parental rights of his child’s mother by kidnapping the child and failing to return the child to the United States when ordered to do so, U.S. Attorney Philip R. Sellinger announced today.
Amitkumar Kanubhai Patel, 38, of Vadodara, India, formerly of Edison, New Jersey, was convicted on July 22, 2022, of one count of international parental kidnapping following a five-day trial before U.S. District Judge Renée Marie Bumb in Camden federal court.
According to documents filed in this case and the evidence at trial:
The child’s mother and Patel were in a relationship and resided together in New Jersey from August 2015 through July 2017. The two never married. In November 2016, Patel and the child’s mother had a child, who was born in Edison Township.
According to the child’s mother, Patel wanted to take the child to India to introduce him to Patel’s parents and obtain DNA testing, which Patel claimed was necessary for the child to claim property that Patel’s family owned in India. Patel also told the child’s mother that in order to obtain an Indian visa for the child, he would need to secure sole custody, which required them to go to court. Patel instructed the mother to tell the court that they had a mutual understanding regarding the custody of their child. Patel instructed the mother to state that she did not have a work permit, and since she was unemployed, she could not care for her child.
On May 1, 2017, Patel took the child’s mother to New Jersey Superior Court, Chancery Division Family Court, in order to obtain sole custody of the child. According to the mother, the majority of the hearing was conducted in English with no translator. At the time of the hearing, the mother spoke limited English. The mother answered the court’s questions as she had been instructed by Patel. The mother was not represented by an attorney during the hearing.
On May 2, 2017, the New Jersey Superior Court granted Patel sole legal custody of the child premised on the consent of the child’s mother to the arrangement, but specifically reserved for the mother the ability to file for joint legal custody if she so chose in future. Upon receiving the court order, Patel obtained visas to India for himself and the child, and booked air travel, telling the child’s mother that they would only be gone for two weeks to a month. Patel then took the child to India and after several days in India, called the mother and said that he was never bringing the child back to the United States. The child’s mother obtained legal counsel and returned to the New Jersey Superior Court. On Oct. 16, 2018, the New Jersey Superior Court entered an order directing Patel to return the child to the United States immediately.
On Oct. 19, 2018, the mother’s counsel emailed the October 16, 2018, family court order to Patel, who did not return the child to the United States. On Oct. 2, 2020, Patel and the child flew from India to the United Kingdom. Upon arrival, Patel was arrested based on a provisional arrest request submitted by the United States. After a custody hearing in London pursuant to the Hague Convention, the London Court ordered it was in the best interest of the child that the child be returned to his paternal grandparents in India. Patel was subsequently extradited to the United States to stand trial.
The international parental kidnapping offense of which Patel stands convicted carries a maximum penalty of three years in prison and a maximum fine of $250,000. Sentencing is scheduled for Nov. 22, 2022.
U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge Jacqueline McGuire in Philadelphia, with the investigation leading to the guilty verdict. U.S. Attorney Sellinger also thanked members of the Department’s Office of International Affairs, the U.K. Crown Prosecution Service and the Metropolitan Police for their assistance in the extradition.
The government is represented by Deputy U.S. Attorney Andrew Carey and Assistant U.S. Attorney Jason M. Richardson of the U.S. Attorney=s Office Criminal Division in Camden.
Two Clinical Labs and Their Owners Agree to Pay $5.7 Million to Resolve False Claims and Kickback AllegationsRead the Press Release
NEWARK, N.J. – Two clinical laboratories and their owners have agreed to pay $5.7 million to resolve allegations that they caused the submission of false claims to Medicare by paying kickbacks in return for genetic testing samples, the Department of Justice announced today.
Metric Lab Services LLC and Metric Management Services LLC (Metric) and Spectrum Diagnostic Labs LLC (Spectrum) and two of their owners and operators, Sherman Kennerson and Jeffrey Madison, have agreed to the settlement.
“Rather than compete fairly for business, these labs engaged in a brazen kickback scheme to rake in millions of dollars of Medicare money,” Philip R. Sellinger, U.S. Attorney for the District of New Jersey, said. “A patient’s needs must guide medical decisions, not who is paying the biggest kickback. Today’s settlement recoups millions of dollars for the Medicare program, and demonstrates this Office’s continuing resolve to protect the integrity of federal healthcare programs.”
“Laboratories that attempt to profit from unlawful kickbacks will be held accountable,” Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division, said. “The department will continue to pursue those who undermine the integrity of federal health care programs and waste taxpayer dollars.”
“When health care providers engage in kickback schemes – particularly ones that deceive Medicare patients about the medical necessity of services – the trust of both patients and taxpayers are at risk,” Special Agent in Charge Scott J. Lampert of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) said. “This case shows our commitment to investigating such allegations in order to protect the Medicare program’s ability to subsist and serve its mission.”
Metric and Spectrum were clinical laboratories in Mississippi and Texas, which Kennerson and Madison co-owned and operated along with other individuals. The United States alleged that Metric, Spectrum, Kennerson and Madison participated in a genetic testing fraud scheme with various marketers. These marketers solicited genetic testing samples from Medicare beneficiaries. The marketers arranged to have a physician fraudulently attest that the genetic testing was medically necessary, and Metric and Spectrum would process the tests, receive reimbursement from Medicare and pay a portion of that reimbursement to the marketers.
In an attempt to conceal the nature of the kickback arrangement, Metric and Spectrum entered into sham agreements with marketers to provide various consulting, marketing and other services at an hourly rate. In reality, however, Metric and Spectrum paid the marketers a percentage of revenue, including Medicare reimbursement, in return for the samples. The marketers then generated sham invoices for hourly services that matched the agreed-upon kickback amount.
Kennerson and Madison each previously pleaded guilty to one count of conspiracy to defraud the United States in connection with this scheme and are awaiting sentencing.
The resolution obtained in this matter was the result of a coordinated effort between the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office for the District of New Jersey, with assistance from HHS-OIG.
The government is represented by Assistant U.S. Attorney Andrew A. Caffrey III of the District of New Jersey and DOJ Trial Attorney J. Jennifer Koh.
The investigation and resolution of this matter illustrates the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse and mismanagement can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).
The claims resolved by the settlement are allegations only and there has been no determination of liability except to the extent admitted by Kennerson and Madison in their criminal pleas.
Metric Lab Services, Metric Management Services LLC, Spectrum Diagnostic Labs LLC, and Owners Agree to Pay $5.7 Million to Settle Allegations of False Claims for Unnecessary Genetic TestingRead the Press Release
Metric Lab Services LLC and Metric Management Services LLC (collectively, Metric) and Spectrum Diagnostic Labs LLC (Spectrum) and two of their owners and operators, Sherman Kennerson and Jeffrey Madison, have agreed to pay $5.7 million to resolve allegations that they caused the submission of false claims to Medicare by paying kickbacks in return for genetic testing samples, the Department of Justice announced today.
Metric and Spectrum were clinical laboratories in Mississippi and Texas, which Kennerson and Madison co-owned and operated along with other individuals. The United States alleged that Metric, Spectrum, Kennerson and Madison participated in a genetic testing fraud scheme with various marketers. These marketers solicited genetic testing samples from Medicare beneficiaries. The marketers arranged to have a physician fraudulently attest that the genetic testing was medically necessary, and Metric and Spectrum would process the tests, receive reimbursement from Medicare and pay a portion of that reimbursement to the marketers.
In an attempt to conceal the nature of the kickback arrangement, Metric and Spectrum entered into sham agreements with marketers to provide various consulting, marketing and other services at an hourly rate. In reality, however, Metric and Spectrum paid the marketers a percentage of revenue, including Medicare reimbursement, in return for the samples. The marketers then generated sham invoices for hourly services that matched the agreed-upon kickback amount.
“Laboratories that attempt to profit from unlawful kickbacks will be held accountable,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The department will continue to pursue those who undermine the integrity of federal health care programs and waste taxpayer dollars.”
“Rather than compete fairly for business, these labs engaged in a brazen kickback scheme to rake in millions of dollars of Medicare money,” said U.S. Attorney Philip R. Sellinger for the District of New Jersey. “A patient’s needs must guide medical decisions, not who is paying the biggest kickback. Today’s settlement recoups millions of dollars for the Medicare program, and demonstrates this Office’s continuing resolve to protect the integrity of federal healthcare programs.”
“When health care providers engage in kickback schemes, the trust of both patients and taxpayers are at risk,” said Special Agent in Charge Scott J. Lampert of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG). “This case shows our commitment to investigating such allegations in order to protect the Medicare program’s ability to subsist and serve its mission.”
Kennerson and Madison have previously each pled guilty to one count of conspiracy to defraud the United States in connection with this scheme and are awaiting sentencing. United States v. Kennerson, No. 20-cr-00448 (BRM) and United States v. Madison, No. 20-cr-00449 (BRM) (D.N.J.).
The resolution obtained in this matter was the result of a coordinated effort between the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office for the District of New Jersey, with assistance from HHS-OIG.
The matter was handled by Trial Attorney J. Jennifer Koh and Assistant U.S. Attorney Andrew A. Caffrey III for the District of New Jersey.
The investigation and resolution of this matter illustrates the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse and mismanagement can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).
The claims resolved by the settlement are allegations only and there has been no determination of liability except to the extent admitted by Kennerson and Madison in their criminal pleas.
Florida Man Charged with $1.6 Million Cares Act Loan Fraud SchemeRead the Press Release
NEWARK, N.J. – A Florida man will make his initial court appearance today on charges related to his role in a scheme to fraudulently obtain over $1.6 million in federal Paycheck Protection Program (PPP) loans and Economic Injury Disaster Loan (EIDL) payments, U.S. Attorney Philip R. Sellinger announced.
Mohamed A. Awad, 60, of Ocala, Florida, is charged by complaint with two counts of wire fraud. He was arrested July 21, 2022, in Virginia and made his initial appearance this afternoon before U.S. Magistrate Judge William E. Fitzpatrick in the Eastern District of Virginia. He was detained pending transfer to the District of New Jersey.
According to documents filed in this case and statements made in court:
The Coronavirus Aid, Relief, and Economic Security (CARES) Act is a federal law enacted on March 29, 2020, designed to provide emergency financial assistance to millions of Americans suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses, through the PPP. The PPP allowed qualifying small businesses and other organizations to receive loans with a maturity of two years and an interest rate of 1 percent. PPP loan proceeds must be used by businesses on payroll costs, interest on mortgages, rent, and utilities.
The CARES Act also authorized the U.S. Small Business Association to provide EIDLs of up to $2 million, through the Economic Injury Disaster Loan Program, to eligible small businesses experiencing substantial financial disruption due to the COVID-19 pandemic.
Awad engaged in a scheme to illegally obtain over $1.6 million in PPP and EIDL loans through numerous misrepresentations to lenders. He submitted fraudulent loan applications that fabricated numbers of employees and misrepresented company information, to induce PPP and EIDL lenders to approve the loan applications that they otherwise would not have approved. Awad submitted falsified tax documents in support of PPP applications. According to IRS records, none of the purported tax documents that Awad submitted were ever in fact filed with the IRS. Awad transferred the loan proceeds among various bank accounts he controlled, withdrawing significant amounts in cash and transferring at least approximately $760,000 out of the country via wire transfers to banks based in Egypt.
The charges each carry a maximum penalty of 20 years in prison and a maximum fine of $250,000 or twice the gross gain to the defendant or gross loss to the victim, whichever is greatest.
U.S. Attorney Sellinger credited special agents of the IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Tammy Tomlins; postal inspectors of the U.S. Postal Inspection Service in Newark, under the direction of Inspector in Charge Damon Wood, Philadelphia Division; special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark; special agents of the Social Security Administration, Office of the Inspector General, under the direction of Special Agent in Charge Sharon MacDermott; special agents of the Office of Inspector General for the Board of Governors of the Federal Reserve System and the Bureau of Consumer Financial Protection, under the direction of Stephen Donnelly, Eastern Region; special agents of the Federal Deposit Insurance Corporation – Office of Inspector General, under the direction of Special Agent in Charge Patricia Tarasca in New York; and special agents of the U.S. Attorney’s Office for the District of New Jersey, under the direction of Special Agent in Charge Thomas Mahoney, with the investigation leading to the charges.
The government is represented by Assistant U.S. Attorney Katherine M. Romano of the U.S. Attorney’s Office’s Health Care Fraud Unit in Newark.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
The charges and allegations contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Hudson County Man Admits Drug Conspiracy and Possession with Intent to Distribute CocaineRead the Press Release
NEWARK, N.J. – A Hudson County, New Jersey man today admitted conspiring to distribute and possessing with intent to distribute cocaine, U.S. Attorney Philip R. Sellinger announced today.
Jerome Powell, 43, of Jersey City, New Jersey, pleaded guilty by videoconference before U.S. District Court Judge Susan D. Wigenton to a superseding information charging him with one count of conspiracy to distribute cocaine and one count of possession with intent to distribute cocaine.
According to the documents filed in this case and statements made in court:
From August 2019 through Feb. 2, 2020, Powell and others agreed to possess and distribute narcotics in Jersey City. Upon his arrest, Powell had 400 vials of cocaine in his pocket.
The charges of conspiracy to distribute cocaine and possession with intent to distribute cocaine each carry a maximum penalty of 20 years in prison and a maximum fine of $1 million. Sentencing is scheduled for Dec. 8, 2022.
U.S. Attorney Sellinger credited special agents and task force officers of the Drug Enforcement Administration, under the direction of Special Agent in Charge Susan A. Gibson, New Jersey Division; and members of the Jersey City Police Department, under the direction of Public Safety Director James Shea, with the investigation leading to the charges.
This investigation was conducted as part of the Jersey City Violent Crime Initiative (VCI). The VCI was formed in 2018 by the U.S. Attorney’s Office for the District of New Jersey, the Hudson County Prosecutor’s Office, and the Jersey City Police Department, for the sole purpose of combatting violent crime in and around Jersey City. As part of this partnership, federal, state, county, and city agencies collaborate to strategize and prioritize the prosecution of violent offenders who endanger the safety of the community. The VCI is composed of the U.S. Attorney’s Office, the FBI, the ATF, the Drug Enforcement Administration’s (DEA) New Jersey Division, the U.S. Marshals, the Jersey City Police Department, the Hudson County Prosecutor’s Office, the Hudson County Sheriff’s Office, New Jersey State Parole, the Hudson County Jail, and the New Jersey State Police Regional Operations and Intelligence Center/Real Time Crime Center.
The government is represented by Assistant U.S. Attorney Tracey Agnew of the U.S. Attorney’s Office in Trenton.
Burlington County Woman Sentenced One Year and One Day in Prison for Role in Scheme to Launder Money, Defraud Internet DonorsRead the Press Release
CAMDEN, N.J. – A Burlington County, New Jersey, woman was sentenced today to one year and one day in prison for her role in a GoFundMe scam that gained nationwide attention, U.S. Attorney Philip R. Sellinger announced.
Katelyn McClure, 32, of Bordentown, New Jersey, previously pleaded guilty before U.S. District Judge Jerome B. Simandle to an information charging her with one count of conspiracy to commit wire fraud. U.S. District Judge Noel L. Hillman imposed the sentence today in Camden federal court.
According to documents filed in this case and statements made in court:
In November 2017, McClure and Mark D’Amico, 43, allegedly created a crowd-source funding page on GoFundMe’s website titled “Paying It Forward.” The campaign solicited donations from the public purportedly for the benefit of a homeless veteran, Johnny Bobbitt, 39, of Philadelphia. McClure and D’Amico posted a story that McClure was driving home from Philadelphia on Interstate 95 and ran out of gas. Bobbitt acted as a “good Samaritan” and rescued McClure by using his last $20 to buy gasoline for her. The website stated that funds were being solicited to get Bobbitt off the streets and provide him with living expenses, setting a goal of $10,000.
In reality, McClure never ran out of gas and Bobbitt never spent his last $20 for her. D’Amico and McClure allegedly conspired to create the false story to obtain money from donors. The story was quickly picked up by local and national media outlets and went viral and raised approximately $400,000 from more than 14,000 donors in less than three weeks.
The donated funds were transferred by D’Amico and McClure from GoFundMe into accounts that they controlled. The majority of the money allegedly was quickly spent by D’Amico and McClure on personal expenses over the next three months.
In mid-November of 2017, when the donations had reached approximately $1,500, D’Amico and McClure told Bobbitt about the campaign and the false gas story. In December of 2017, after setting up a bank account for Bobbitt, D’Amico and McClure deposited $25,000 of proceeds of the scheme into Bobbitt’s account.
In addition to the prison term, Judge Hillman sentenced McClure to three years of supervised release and ordered her to pay $400,000 in restitution. D’Amico previously pleaded guilty and was sentenced in April 2022 to 27 months in prison; Bobbitt pleaded guilty and is awaiting sentencing.
U.S. Attorney Sellinger credited assistant prosecutors and detectives of the Burlington County Prosecutor’s Office, under the direction of Prosecutor Lachia L. Bradshaw; officers of the Florence Township Police Department; special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Tammy Tomlins; and special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney Jeffrey Bender of the Criminal Division in Camden.
Burlington County Man Sentenced to 10 Years in Prison for Role in Drug Trafficking OrganizationRead the Press Release
TRENTON, N.J. – A Burlington County, New Jersey, man was sentenced to 120 months in prison for conspiring to distribute large amounts of cocaine and crack cocaine throughout Burlington County, U.S. Attorney Philip R. Sellinger announced today.
Herbert Mays, 65, of Willingboro, New Jersey, previously pleaded guilty before U.S. District Judge Zahid N. Quraishi to a superseding indictment charging him with conspiracy to distribute and possess with intent to distribute more than five kilograms of cocaine and conspiracy to distribute and possess with intent to distribute more than 280 grams of crack cocaine. Judge Quraishi imposed the sentence on July 20, 2022, in Trenton federal court.
Eighteen other members of the drug trafficking conspiracy have pleaded guilty. The charges against two other defendants remain pending; the charges against them are merely accusations, and they are presumed innocent unless and until proven guilty.
According to the documents filed in this case and statements made in court:
Between July 2019 and September 2019, Mays, his codefendants and others engaged in a narcotics conspiracy that operated primarily in municipalities throughout Burlington County – including Willingboro, Burlington City, Burlington Township, Bordentown Township, and Edgewater Park – and which sought to profit from the distribution of cocaine and crack cocaine. Law enforcement officials learned that defendants obtained regular supplies of cocaine from co-conspirators in the Philadelphia area and elsewhere and then redistributed that cocaine, portions of which defendants converted into crack cocaine, for profit, to other conspirators, distributors, sub-dealers, and end users throughout Burlington County and elsewhere. Law enforcement officials intercepted numerous communications by and between the conspirators regarding such issues as cocaine and crack cocaine quality and availability, pricing, packaging, quantity, and customer satisfaction.
In addition to the prison term, Judge Quraishi sentenced Mays to five years of supervised release.
U.S. Attorney Sellinger credited special agents of the FBI, Trenton Resident Agency, under the direction of Special Agent in Charge James E. Dennehy in Newark; special agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives, Newark Field Division, under the direction of Special Agent in Charge Jeffrey L. Matthews; detectives of the Burlington County Prosecutor’s Office, under the direction of Burlington County Prosecutor Lachia L. Bradshaw; officers of the Burlington Township Police Department, under the direction of Director of Public Safety Bruce Painter; officers of the Willingboro Police Department, under the direction of Acting Director of Public Safety Ian Bucs; officers of the Burlington City Police Department, under the direction of Chief of Police John Fine; officers of the Florence Police Department, under the direction of Chief of Police Brian Boldizar; officers of the Bordentown Township Police Department, under the direction of Chief of Police Brian Pesce; officers of the Edgewater Park Police Department, under the direction of Chief of Police Brett V. Evans; officers of the Ewing Police Department, under the direction of Chief of Police Albert Rhodes; officers of the Westampton Police Department, under the direction of Chief of Police Stephen Ent; officers of the Trenton Police Department, under the direction of Director Steve Wilson with the investigation leading to the sentencing.
The government is represented by Assistant U.S. Attorneys Martha K. Nye of the U.S. Attorney’s Office’s Criminal Division in Trenton and Andrew B. Johns of the Criminal Division in Camden.
U.S. Attorney and New Jersey Acting Attorney General Join Forces in Support of Continued Access to Reproductive Health CareRead the Press Release
NEWARK, N.J. – U.S. Attorney Philip R. Sellinger joined New Jersey Acting Attorney General Matthew J. Platkin today to announce their continued commitment to ensure that women in New Jersey have access to reproductive health care services in the wake of the U.S. Supreme Court’s Dobbs decision overturning Roe v. Wade.
“The U.S. Attorney’s Office for the District of New Jersey – and the entire Justice Department – will do everything within our power to protect reproductive freedom,” U.S. Attorney Sellinger said. “Despite the Court’s decision, abortion remains legal in New Jersey. We will work tirelessly to ensure women’s unobstructed access to reproductive health services throughout New Jersey, including access to abortion services, so that women may consult with their medical providers to make important and personal decisions about their bodies and their lives.”
“As other states impose draconian penalties on patients and health care professionals who seek or provide abortion care, New Jersey has chosen a very different path. We are using every available tool at our disposal to keep abortion patients and their providers safe,” Acting Attorney General Platkin said. “We’re proud to work side-by-side with Governor Murphy, the U.S. Attorney’s Office, and the federal government to protect access to reproductive health care.”
U.S. Sellinger and Acting Attorney General Platkin made the joint announcement today at a press conference in Newark.
U.S. Attorney Sellinger and Acting Attorney General Platkin emphasized their commitment to have open lines of communications and, when appropriate, to share intelligence and information in order to facilitate efficient decision-making in protecting reproductive rights. They also announced plans for their offices to work together to conduct a series of outreach sessions with stakeholders, such as reproductive service providers and advocates, to send a clear message that law enforcement at all levels will protect reproductive rights.
U.S. Attorney Sellinger reiterated U.S. Attorney General Merrick B. Garland’s strong disagreement with the Dobbs ruling and its far-reaching impact on people, particularly people of color and limited financial resources.
“While the right to control one’s own body is central to individual freedom, the Court’s decision denies millions of women that right by preventing them from being able to make critical and highly personal decisions about their bodies, their health, and their futures,” U.S. Attorney Sellinger said.U.S. Attorney Sellinger promised continued enforcement of the Freedom of Access to Clinic Entrances (FACE) Act, which prohibits obstructing access to reproductive health services through violence, threats of violence, or property damage. He said women who live in New Jersey – or who travel to New Jersey – will continue to have unobstructed access to reproductive health services, including abortion services.
The Office’s newly created Civil Rights Division will lead the Office’s enforcement and outreach efforts. The Division brings together civil and criminal prosecutors into one division focused on protecting vitally important civil rights, including the right to access reproductive health care.
Anyone with knowledge of FACE Act violations can contact the office through the civil rights hotline at 855-281-3339 or through the complaint portal on the U.S. Attorney’s Office, District of New Jersey, website: District of New Jersey.
Somerset County Man Sentenced to 46 Months in Prison for Orchestrating COVID-19 FraudRead the Press Release
TRENTON, N.J. – A Somerset County, New Jersey, man was sentenced to 46 months in prison for orchestrating a $2 million COVID-19 fraud scheme, U.S. Attorney Philip R. Sellinger announced today.
Guaravjit “Raj” Singh, 27, of Montgomery, New Jersey, previously pleaded guilty before U.S. District Court Judge Peter G. Sheridan to an information charging him with one count of wire fraud. Judge Sheridan imposed the sentence on July 20, 2021, in Trenton federal court.
According to documents filed in this case and statements made in court:
From May 2020, in the midst of the COVID-19 pandemic, Singh engaged in a scheme to defraud and to enrich himself by fraudulently inducing 10 victims to send him over $2 million to obtain personal protective equipment (PPE) and then stealing the money and not providing the PPE to the victims as promised.
Singh induced victims to enter into an agreement pursuant to which Singh would be paid approximately $7.1 million for approximately 1.5 million medical gowns, which ultimately were to be sourced to the city of New York amid the COVID-19 pandemic. The victims wired Singh, though his company GJS Solutions LLC, $712,500, representing a 10 percent initial deposit for the medical gowns. After receiving these funds from the victims, Singh made additional misrepresentations and excuses to the victims, ensuring them that they would receive the medical gowns. Instead of purchasing and delivering medical gowns, Singh used the funds for personal expenses.
In addition to the prison term, Judge Sheridan sentenced Singh to three years of supervised release.
U.S. Attorney Sellinger credited special agents and intelligence analysts of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark, with the investigation leading to the sentencing.
The government is represented by Assistant U.S. Attorney Lauren E. Repole, Chief of the General Crimes Unit in Newark.
Media AdvisoryRead the Press Release
United States Attorney Philip R. Sellinger and New Jersey Acting Attorney General Matthew J. Platkin to Announce State-Federal Collaboration to Ensure Protection of Individuals Seeking Abortion and Security of Abortion Providers
****** MEDIA ADVISORY — PLANNING PURPOSES ONLY ******NEWARK, N.J. – U.S. Attorney Philip R. Sellinger, District of New Jersey, and New Jersey Acting Attorney General Matthew J. Platkin to announce partnership that will protect in- and out-of-state patients, health care workers and reproductive health services providers while coordinating intelligence-sharing across local, state and federal law enforcement agencies.
WHEN: Wednesday, July 20, 2022, 2:00 p.m. EDT
WHO: U.S. Attorney Philip R. Sellinger, District of New Jersey
New Jersey Acting Attorney General Matthew J. PlatkinLaurie Doran, Director, New Jersey Office of Homeland Security and Preparedness
Pearl Minato, Director, Division of Criminal Justice
Cari Fais, Director, Division of Consumer AffairsWHERE: Office of the Attorney General, 124 Halsey St, 7th Floor, Newark, NJ.
Livestream available at: https://youtu.be/0BGCJ_Sx7w0
Former Sales Representative Convicted in Compound Prescription Drug SchemeRead the Press Release
NEWARK, N.J. – A former sales representative was convicted by a federal jury for his role in a scheme to defraud public health benefits programs by billing for medically unnecessary compound prescriptions, U.S. Attorney Philip R. Sellinger announced today.
Matthew Puccio, 40, of Randolph, New Jersey, was convicted on July 19, 2022, of conspiracy to commit health care fraud following a seven-day jury trial before U.S. District Judge John Michael Vazquez.
According to documents in this case and the evidence at trial:
Compound medications are specialty medications mixed by a pharmacist to meet the specific medical needs of an individual patient. Although compound drugs are not approved by the Food and Drug Administration (FDA), they are properly prescribed when a physician determines that an FDA-approved medication does not meet the health needs of a particular patient, such as if a patient is allergic to a dye or other ingredients in the prescription.
From November 2014 to March 2016, Puccio participated in a conspiracy that involved submitting fraudulent prescriptions for compound medications to public health benefits programs. Marketing companies recruited and paid sales representatives, such as Puccio, to obtain compound medications for themselves and others regardless of medical necessity, targeting health plans that reimbursed for compound medications at high rates.
Puccio exploited this opportunity through working as a sales representative for several compounding pharmacies. He targeted individuals who had health plans that covered compound medications and then convinced those individuals to obtain prescriptions for compound medications, regardless of medical necessity. Puccio and others induced two New Jersey-based physicians to sign medically unnecessary prescriptions for beneficiaries that Puccio and others had recruited.
Once the prescriptions were written, they were filled by the compounding pharmacies with which Puccio worked. The compounding pharmacies would then receive reimbursement from the health plans and would pay Puccio a percentage of the reimbursement amount. Puccio and his conspirators caused a significant loss to public health benefits programs.
For the charge of conspiracy to commit health care fraud, Puccio faces a statutory maximum of 10 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Sentencing is scheduled for Nov. 29, 2022.
U.S. Attorney Sellinger credited special agents of the FBI, Newark Division, under the direction of Special Agent in Charge James E. Dennehy in Newark, with the investigation leading to today’s conviction.
The government is represented by Assistant U.S. Attorneys Emma Spiro and Shawn Barnes of the Criminal Division in Newark.
Camden County Man Admits Defrauding COVID-19 Relief Programs and Illegally Possessing FirearmRead the Press Release
CAMDEN, N.J. – A Camden County, New Jersey, man today admitted conspiring to fraudulently obtain COVID-19 relief funds, fraudulently obtaining unemployment benefits, and illegally possessing a firearm, U.S. Attorney Philip R. Sellinger announced.
Stephen Bennett, 46, of Berlin, New Jersey, pleaded guilty before U.S. District Judge Karen M. Williams in Camden federal court to an information charging him with one count of bank fraud conspiracy, one count of wire fraud, and one count of being a felon in possession of a firearm.
According to documents filed in this case and statements made in court:
The Coronavirus Aid, Relief, and Economic Security (CARES) Act is a federal law enacted in March 2020 and was designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of hundreds of billions of dollars in forgivable loans to small businesses for job retention and certain other expenses, through a program referred to as the Paycheck Protection Program (PPP). The CARES Act also authorized the Small Business Administration to provide Economic Injury Disaster Loans (EIDLs) of up to $2 million to eligible small businesses that were experiencing substantial financial disruption due to the COVID-19 pandemic.
To obtain a PPP or EIDL loan, a qualifying small business was required to apply and provide information on its operations, including the number of employees and expenses. In addition, businesses generally had to provide supporting documentation.
The CARES Act also created a new temporary federal unemployment insurance program called Pandemic Unemployment Assistance (PUA), which provided unemployment insurance benefits for individuals who were not eligible for other types of unemployment (the self-employed, independent contractors, gig economy workers). The CARES Act also created a new temporary federal program called Federal Pandemic Unemployment Assistance (FPUC) that provided an additional $600 weekly benefit to those eligible for PUA and regular unemployment insurance benefits.
In 2020, Bennett conspired with Rhonda Thomas to submit one PPP application and one EIDL application for a company controlled by Bennett. The applications stated that the company had 16 employees, gross revenues of $1.73 million, and an average monthly payroll of $144,000, when in fact the company had no employees, revenue, or payroll. Bennett and Thomas also submitted forged tax forms and altered bank statements as part of the PPP loan application. Based on the misrepresentations, the loans were approved in the amount of $510,000. Bennett paid kickbacks of over $150,000 to Thomas and used the rest of the fraudulently obtained PPP and EIDL loan proceeds to pay for personal expenses, including jewelry and vehicles.
Also in 2020, Bennett defrauded the Pennsylvania Department of Labor by submitting 74 unemployment insurance claims in the names of other individuals. Bennett falsely stated on that the applicants were self-employed and unemployed because of COVID-19. Benefits of $425,339 were paid to Bennett as a result of the fraudulent claims he submitted.
In May 2021, law enforcement officials executing a search warrant at Bennett’s home found a .9 millimeter semiautomatic pistol with no serial number (commonly referred to as a “ghost gun”) and a magazine loaded with 16 rounds of ammunition.
The charge of bank fraud conspiracy carries a maximum penalty of 30 years in prison and a fine of $1 million. The count of wire fraud is punishable by a maximum of 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. The count of being a felon in possession of a firearm carries a maximum of 10 years in prison and a $250,000 fine. Sentencing is scheduled for Nov. 21, 2022.
Thomas previously pleaded guilty to bank fraud conspiracy and money laundering and is awaiting sentencing.
U.S. Attorney Sellinger credited special agents of the Federal Deposit Insurance Corporation – Office of the Inspector General, under the direction of Patricia Tarasca, Special Agent-in-Charge, New York Regional Office; special agents of the Social Security Administration, Office of Inspector General, New York Field Division, under the direction of Special Agent in Charge Sharon MacDermott; special agents of the FBI’s South Jersey Resident Agency, under the direction of Special Agent in Charge Jacqueline Maguire in Philadelphia, special agents of the U.S. Department of Labor, Office of the Inspector General, New York Region, under the direction of Special Agent in Charge Jonathan Mellone, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Daniel A. Friedman of the U.S. Attorney’s Office’s Criminal Division in Camden and Senior Litigation Counsel Jason M. Richardson of the U.S. Attorney’s Office Civil Rights Division in Camden.
Ocean County Man Admits Receiving Child Pornography and Online Enticement of MinorRead the Press Release
TRENTON, N.J. – An Ocean County, New Jersey, man today admitted receiving images of child sexual abuse and inducing a minor to send him sexually explicit images and engage in sexually explicit conduct over an online messaging service, U.S. Attorney Philip Sellinger announced.
David M. Frew, 41, of Little Egg Harbor, New Jersey, pleaded guilty by videoconference before U.S. District Judge Michael A. Shipp to an information charging him with one count of receipt of child pornography and one count of online enticement of a minor to engage in criminal sexual conduct.
According to documents filed in this case and statements made in court:
In June 2017, Frew used an online messaging service to communicate with a minor victim. At Frew’s request, the victim sent Frew sexually explicit images.
In 2008, Frew was convicted of three counts of unlawful contact with a minor and one count of criminal use of a computer in Pennsylvania after sending sexually explicit photos or videos to investigators in the Pennsylvania Attorney General’s Child Predator Unit, who were posing as minors online. Also in 2008, Frew was convicted in New Jersey of endangering the welfare of children due to his possession of child pornography. As a result of his prior convictions in Pennsylvania and New Jersey, Frew was a registered sex offender at the time of his conduct charged in the information.
Because Frew is a previously convicted sex offender, the charge of receipt of child pornography carries a mandatory minimum sentence of 15 years in prison, a statutory maximum potential penalty of 40 years in prison, and a $250,000 fine. The charge of online enticement carries a mandatory minimum sentence of 10 years in prison and a statutory maximum potential penalty of life in prison, and a $250,000 fine. Sentencing is scheduled for Nov. 23, 2022.
U.S. Attorney Sellinger credited special agents of the Department of Homeland Security, Homeland Security Investigations (HSI), in Atlantic City, under the direction of Special Agent in Charge Jason J. Molina in Newark; the Royal Canadian Mounted Police (RCMP) Technical Crime Unit; the RCMP National Child Exploitation Coordination Centre; the Ocean County Prosecutors Office, under the direction of Prosecutor Bradley D. Billhimer; and the Little Egg Harbor Police Department, under the direction of Chief James Hawkins, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Alexander E. Ramey of the U.S. Attorney’s Office Criminal Division in Trenton.
Monmouth County Man Admits Online Sexual Enticement of MinorRead the Press Release
NEWARK, N.J. – A Manalapan, New Jersey, man today admitted using online chat applications to entice an adolescent to engage in prohibited sexual activity, U.S. Attorney Philip R. Sellinger announced.
Angelo N. Curato, 30, pleaded guilty by videoconference before U.S. District Judge Brian Martinotti to a superseding information charging him with one count of online enticement of a minor.
According to documents filed in the case and statements made in court:
From February 2017 through June 2017, Curato used online chat applications to misrepresent his identity and entice or coerce an adolescent to engage in prohibited sexual activity, knowing that the victim was under the age of 18.
The online enticement charge carries a maximum penalty of life in prison, a mandatory minimum prison term of 10 years, and a $250,000 fine. Sentencing is scheduled for Nov. 29, 2022.
U.S. Attorney Sellinger credited special agents of Department of Homeland Security, Homeland Security Investigations, under the direction of Special Agent in Charge Jason J. Molina in Newark; and the Monmouth County Prosecutor’s Office, under the direction of Acting Prosecutor Lori Linskey, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Barry O’Connell of the U.S. Attorney’s Office General Crimes Unit.
Appeals Court Affirms Convictions and Sentences in Organized Crime CaseRead the Press Release
NEWARK, N.J. – A federal appeals court has upheld the convictions and sentences of a member and an associate of the Lucchese organized crime family and two Texas brothers on racketeering conspiracy and related offenses, U.S. Attorney Philip R. Sellinger announced today.
Nicodemo S. Scarfo, 57, of Galloway, New Jersey, a member of the Lucchese organized crime family of La Cosa Nostra (LCN), and Salvatore Pelullo, 55, of Philadelphia, an associate of the Lucchese and Philadelphia LCN families, were convicted on July 13, 2014, of all the counts against them. Two other defendants, William Maxwell, 63, of Houston, Texas, and his brother, John Maxwell, 70, of Irving, Texas, were also convicted.
In a consolidated appeal, the defendants challenged almost every aspect of their prosecutions, including the investigation, the charges and evidence against them, the pretrial process, the government’s compliance with its disclosure obligations, the trial, the forfeiture proceedings, and their sentences.
In a precedential, 169-page opinion issued July 15, 2022, a three-judge panel of the U.S. Court of Appeals for the Third Circuit affirmed all the convictions and sentences, except for the forfeiture portion of John Maxwell’s sentence, for which it remanded the matter to the District Court to determine what share of the forfeiture he should pay.
The four defendants were convicted for their respective roles in the takeover and subsequent looting of FirstPlus Financial Group, a publicly held mortgage company based in Dallas, Texas. The defendants used extortionate threats to take control of the company, causing a loss of more than $14 million and leaving more than 1,000 shareholders with investments that had been rendered worthless. Scarfo and Pelullo were each sentenced to 30 years in prison; William Maxwell was sentenced to 20 years in prison; and John Maxwell was sentenced to 10 years in prison.
The appellate court decision, written by Circuit Judge Kent A. Jordan and joined by Circuit Judges Thomas L. Ambro and Stephanos Bibas, affirmed the jury’s guilty verdicts on all of the underlying crimes, including participating in a Racketeering Influenced Corrupt Organization conspiracy, conspiracy to commit securities fraud, conspiracy to commit wire fraud, conspiracy to commit money laundering, and firearms offenses. It also affirmed the prison sentences.
The government was represented on appeal by Assistant U.S. Attorneys Norman Gross and Sabrina Comizzoli of the Appeals Division and Bruce P. Keller, Special Counsel to the U.S. Attorney.
Monmouth County Man Convicted of Drug Trafficking and Firearms OffensesRead the Press Release
TRENTON, N.J. – A Monmouth County, New Jersey, man was convicted of narcotics and firearms offenses, U.S. Attorney Philip R. Sellinger announced today.
Marnell Johnson, 46, of Long Branch, New Jersey, was convicted on July 14, 2022, following a three-day trial before U.S. District Judge Michael A. Shipp in Trenton federal court. Johnson was convicted of possession with intent to distribute heroin; possession of a firearm in furtherance of a drug trafficking crime; and being a felon in possession of a firearm.
According to documents filed in this case and the evidence at trial:
On four occasions in early 2020, Johnson, a previously convicted felon, sold heroin to a confidential source. On April 8, 2020, the special agents of the Drug Enforcement Administration executed a federal search warrant of Johnson’s apartment and recovered heroin and packaging paraphernalia. The DEA also recovered a loaded .380 caliber semi-automatic firearm from the drawer of the same table on which Johnson’s heroin and packaging material were found.
Johnson faces a potential maximum sentence of 20 years in prison on the count of possession with intent to distribute; 10 years in prison on the felon in possession count; and a statutory mandatory minimum sentence of five years in prison and a maximum of life on the count charging possession of a firearm in furtherance of a drug trafficking crime, which must run consecutive to the sentences imposed on the other counts. Johnson also faces a potential maximum fine of $1.5 million.
U.S. Attorney Sellinger credited special agents of the DEA, under the direction of Special Agent in Charge Susan A. Gibson in Newark; the Monmouth County Prosecutor’s Office, under the direction of Acting Prosecutor Lori Linskey; the Ocean County Prosecutor’s Office, under the direction of Prosecutor Bradley D. Billhimer; the Long Branch Police Department, under the direction of Public Safety Director Domingos A. Saldida; the Lakewood Police Department, under the direction of Chief of Police Gregory Howard Meyer; the Neptune Township Police Department, under the direction of Chief of Police Larry B. Fisher; and the Monmouth County Sheriff’s Office, under the direction of Sheriff Shaun Golden, with the investigation leading to the guilty verdict.
The government is represented by Special Assistant U.S. Attorney Christopher Matthews of the Criminal Division and J. Brendan Day, Attorney-in-Charge of the U.S. Attorney’s Office’s Trenton office.
Two New Jersey Men Admit Health Care Fraud Conspiracy Targeting State Health Benefits ProgramsRead the Press Release
CAMDEN, N.J. – Two New Jersey men today admitted defrauding New Jersey state and local health benefits programs and other insurers by submitting fraudulent claims for medically unnecessary prescriptions, Attorney for the United States Vikas Khanna announced.
Brian Pugh, 45, of Absecon, New Jersey, and Thomas Schallus, 45, of Northfield, New Jersey, pleaded guilty before U.S. District Judge Robert B. Kugler to one count each of conspiracy to commit health care fraud.
According to documents filed in this case and statements made in court:
Pugh and Schallus were part of a criminal conspiracy in which state and local government employees were recruited and compensated to receive medically unnecessary compound prescription medications. Pugh and Schallus caused the pharmacy benefits administrator to pay approximately $1.47 million and $477,958.00, respectively, for medically unnecessary compounded prescription medications for individuals they recruited into the scheme.
Pugh and Schallus were previously charged alongside others in an indictment with conspiracy to commit health care fraud and wire fraud and other offenses. Conspiracy leader William Hickman pleaded guilty in June of 2020 to defrauding New Jersey health benefits programs and other insurers out of more than $50 million and is awaiting sentencing. Charges remain pending against co-defendants John Sher, Thomas Sher, and Christopher Broccoli, who are set to proceed to trial before Judge Kugler in Camden federal court on Aug. 15, 2022. The charges against those three defendants are merely accusations, and they remain innocent unless and until proven guilty.
Pugh and Schallus each face a maximum penalty of 10 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Sentencing for Pugh is scheduled for Nov. 17, 2022, and for Schallus, Nov. 14, 2022.
Attorney for the United States Khanna credited agents of the FBI’s Atlantic City Resident Agency, under the direction of Special Agent in Charge Jesse Levine in Newark; special agents of IRS Office of Criminal Investigation, under the direction of Acting Special Agent in Charge Tammy Tomlins in Newark; and special agents of the U.S. Department of Labor Office of Inspector General, New York Region, under the direction of Special Agent in Charge Jonathan Mellone, with the investigation leading to today’s guilty pleas.
The government is represented by Assistant U.S. Attorney Christina O. Hud of the Criminal Division, Deputy Chief of the Criminal Division Desiree Grace, and R. David Walk Jr., Chief of the Opioid Abuse Prevention & Enforcement Unit.
Defense counsel:
Pugh: Michael A. Baldassare Esq. and Jennifer Mara Esq., Newark
Schallus: John C. Whipple Esq., Moorestown, New JerseyNew York Man Sentenced to 22 Months in Prison for Defrauding Customers of New Jersey Moving CompanyRead the Press Release
NEWARK, N.J. – A Hewlett, New York man was sentenced today to 22 months in prison for his role in a scheme through which he defrauded over 260 customers of his moving company causing losses in excess of $540,000, U.S. Attorney Philip R. Sellinger announced.
Lior Atiyas (a/k/a “David Cohen”), 44, previously pleaded guilty to an information charging him with one count of conspiracy to commit wire fraud and one count of conspiracy to commit health care fraud. U.S. District Judge Claire C. Cecchi imposed the sentence today in Newark federal court. His co-conspirator, Lola Larios, is scheduled for sentencing on August 9, 2022, before Judge Cecchi.
According to documents filed in this case and statements made in court:
From as early as January 2016 through January 2019, Atiyas devised a scheme to enrich himself and his moving company, which used several names to conceal its true identity, including Premier Relocations LLC, Metro Van Lines Inc., Astoria Motor Van Company, Lyon Moving, and Empire Move. Atiyas, along with Larios, regularly extorted customers by quoting them “low-ball” price estimates for moving household goods. Once the customers’ goods were loaded onto the moving trucks, Premier’s employees, at the direction of Atiyas or Larios, or Atiyas himself, would drastically raise the price of the move (often two or three times that of the quoted estimate), and then refuse to deliver the goods until the customers paid the increased price. The aggregate difference between the initial low-ball estimates and the revised inflated amounts charged to victims was approximately $547,525.
Atiyas was also convicted of one count of conspiracy to commit health care fraud, for his participation in a scheme whereby he generated fake paystubs and a fake employment confirmation letter in order for an uncharged co-conspirator to obtain Medicaid benefits. As a result of his role in the health care fraud conspiracy, Atiyas caused the submission of over $40,000 in fraudulent medical claims.
In addition to the prison term, Judge Cecchi sentenced Atiyas to three years of supervised release.
If you believe you are a victim of this crime, please contact the U.S. Attorney’s Office Victim-Witness Office at [email protected].
U.S. Attorney Sellinger credited Special Agents with the Department of Transportation, Office of the Inspector General, under the direction of Special Agent in Charge Christopher Scharf, Northeast Region, and the U.S. Department of Health and Human Services, Office of the Inspector General, under the direction of Special Agent in Charge Scott J. Lampert, with the investigation leading to these charges.
The government is represented by Assistant U.S. Attorney Christopher Amore of the U.S. Attorney’s Office National Security Unit in Newark.
Defense counsel for Lior Atiyas: Saul Bienenfeld, Esq.
Middlesex County Man Admits Embezzling $2.37 Million from His Employer While the Controller of CompanyRead the Press Release
TRENTON, N.J.– A Middlesex County, New Jersey, man today admitted his role in a scheme to embezzle $2.37 million from his employer while his was the company’s controller, U.S. Attorney Philip R. Sellinger announced.
Gerard Beauzile, 60, South Plainfield, New Jersey, pleaded guilty before Chief U.S. District Judge Freda L. Wolfson in Trenton federal court, an indictment charging him with one count of wire fraud.
According to documents filed in the case and statements made in court:
From 2014 through December 2020, Beauzile abused his position as controller of a New York-based company to embezzle funds by issuing fraudulent company checks to himself and then depositing those checks into his bank account for his own personal benefit. Beauzile issued approximately 140 company checks to himself with a total value of $2.37 million. Beauzile concealed the theft from the company by falsely entering the fraudulent checks into the company’s accounting system under various company vendor names as the payees, causing the accounting system to falsely reflect that the checks were made payable to company vendors instead of to Beauzile. He also falsified vendor invoices to correspond to the entries made in the accounting system, and company bank statements by removing and altering opening, running, and closing balances, check payment entries, summary check listings, and inter-account transfers.
The mail fraud charge carries a maximum penalty of 20 years in prison and a $250,000 fine. Sentencing is scheduled for Nov.15, 2022.
U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge Jesse Levine in Newark, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Blake Coppotelli of the U.S. Attorney’s Office Economic Crimes Unit.
Defense counsel: Laura Sayler Esq., Assistant Federal Public Defender
Former Benefit Plan Administrator Admits Tax Evasion and Kickback SchemeRead the Press Release
NEWARK, N.J. – A former benefit plan administrator today admitted engaging in multiple years of tax evasion and a kickback scheme related to his role as administrator of two union related employee benefit plans, U.S. Attorney Philip R. Sellinger announced.
Jose Santa Maria, aka “Joe”, 64, North Haledon, New Jersey, pleaded guilty by videoconference before U.S. District Judge Claire C. Cecchi to a six-count information charging him with five counts of tax evasion and one count of paying kickbacks related to an employee benefit plan.
According to documents filed in this case and statements made in court:
Santa Maria was the plan administrator for a health fund and a training fund, both related to a labor union. At the same time, he was also employed by an attorney, who was serving as counsel for the two union funds. From at least 2013 through 2019, Santa Maria misappropriated in excess of $750,000 in benefit plan funds and then failed to report any of it to the IRS or pay the associated income taxes. Santa Maria also paid at least $50,000 to the attorney to influence that attorney’s actions with the executive board for the benefit plans.
The five counts of tax evasion each carry a maximum penalty of five years in prison and a $100,000 fine. The count of paying kickbacks related to an employee benefit plan, carries a maximum penalty of three years in prison and a $250,000 fine. Sentencing is scheduled for Dec. 15, 2022.
U.S. Attorney Sellinger credited investigators of the Department of Labor, Employee Benefits Security Administration (EBSA), under the direction of Regional Director of the New York Regional Office Thomas Licetti; special agents of IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Tammy Tomlins; and special agents of the Port Authority of New York and New Jersey, under the direction of John Gay, with the investigation leading to today’s guilty plea.
The government is represented by Senior Litigation Counsel V. Grady O’Malley and Assistant U.S. Attorney Kendall Randolph of the U.S. Attorney’s Office’s Organized Crime and Gangs Unit in Newark.
Defense counsel Steven D. Altman Esq., New Brunswick, New Jersey
Passaic County Man Admits Role in Illegal Money Transmitting SchemeRead the Press Release
NEWARK, N.J. – A Passaic County, New Jersey, man today admitted his role in an illegal money transmitting business, U.S. Attorney Philip R. Sellinger announced.
Enmanuel Nunez-Reyes, 29, pleaded guilty by videoconference before U.S. District Judge Brian Martinotti to an information charging him with aiding and abetting an illegal money transmitting business.
According to documents filed in this case and statements made in court:
From December 2016 through September 2017, Nunez-Reyes accepted over $2.8 million in cash and purchased over 100 cashier’s checks at local bank branches in New Jersey and elsewhere, the proceeds of illegal drug distribution. The check purchases were part of an illegal money transmitting and money laundering scheme designed to hide the illegal source of the cash and transfer it from New Jersey to the Dominican Republic and Colombia, all while attempting to avoid scrutiny by law enforcement and U.S. banks.
The charge of aiding and abetting an illegal money transmitting business carries a maximum penalty of five years in prison and a fine of $250,000 or twice the amount involved in the offense, whichever is greater. Sentencing is scheduled for Oct. 18, 2022.
U.S. Attorney Sellinger credited special agents and task force officers of the U.S. Drug Enforcement Administration, New Jersey Division, under the direction of Special Agent in Charge Susan A. Gibson; the DEA Special Operations Division, and the Santo Domingo Country Office, under the supervision of Special Agent in Charge Renita D. Foster; special agents and task force officers of IRS - Criminal Investigation, under the direction of Acting Special Agent in Charge Tammy Tomlins; the Morristown, New Jersey, Police Department, under the direction of Acting Police Chief Darnell Richardson; and the Passaic, NJ Police Department under the direction of Chief Luis A. Guzman. U.S. Attorney Sellinger thanked officials in the Dominican Republic for their assistance in the investigation.
The government is represented by Assistant U.S. Attorney Jonathan M. Peck of the Criminal Division in Newark.
This case is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
Defense counsel: Wanda M. Akin Esq., Newark
Two Men Charged with Shooting Taxi Driver During RobberyRead the Press Release
NEWARK, N.J. – Two men have made their initial appearances on charges of shooting a taxi driver during a late-night robbery, U.S. Attorney Philip R. Sellinger announced today.
Naeem Jackson, 22, of East Orange, New Jersey, and Walter Williams-Lang, 20, of Elizabeth, New Jersey, are each charged in a four-count complaint with Hobbs Act violence in furtherance of a planned robbery; discharging a firearm during a crime of violence; conspiracy to use a firearm during a crime of violence; and possessing a firearm as convicted felons. Jackson had his initial appearance by videoconference today before U.S. Magistrate Judge José R. Almonte; Williams-Lang appeared on June 30, 2022, before U.S. Magistrate Judge Cathy L. Waldor. Both were detained without bail.
According to documents filed in this case and statements made in court:
On May 14, 2022, at 4:37 a.m., Jackson and Williams-Lang, wearing dark clothing and masks over their faces, entered a taxi. Williams-Lang pointed a firearm at the taxi driver while demanding his money. Jackson then took the firearm from Williams-Lang and pistol-whipped the taxi driver’s head several times before shooting him in the arm. After leaving the driver in critical condition from a gunshot wound, Jackson and Williams-Lang fled the scene and were arrested.
The counts of Hobbs Act violence and conspiracy to use a firearm during a crime of violence are punishable by 20 years in prison; the count of being convicted felons in possession of a firearm is punishable by 10 years in prison; and the count for discharging a firearm during a crime of violence is punishable by a consecutive sentence of 10 years to life in prison.
U.S. Attorney Sellinger credited the members of the Elizabeth Police Department, under the direction of Director Earl J. Graves and Police Chief Giacommo Sacca; and special agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Jeffrey L. Matthews, Newark Field Division, with the investigation leading to the charges.
The government is represented by Assistant U.S. Attorney Barry O’Connell of the General Crimes Unit in Newark.
The charges and allegations contained in the complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Gas Station Manager Admits to Billing Fraudulent Fuel Charges on Amtrak VehiclesRead the Press Release
NEWARK, N.J. – A Middlesex County, New Jersey, gas station manager today admitted making approximately $78,000 in fraudulent fuel charges using account information belonging to more than 17 gas station customers, including Amtrak, U.S. Attorney Philip R. Sellinger announced.
Umer Hassan Mir, 40, of South Amboy, New Jersey, pleaded guilty by videoconference before U.S. District Judge Claire C. Cecchi to an information charging him with knowingly and with intent to defraud effecting transactions with one or more access devices issued to other persons having a value over $1,000, over a one-year period of time.
According to documents filed in this case and statements made in court:
From February 2018 through August 2021, while working at a Delta gas station in Metuchen, New Jersey, Mir caused numerous fraudulent fuel charges to be entered on fuel credit cards leased by the General Services Administration (GSA) and assigned to Amtrak vehicles. Mir would manually enter account information regarding fuel credit cards that he personally collected and saved during legitimate fuel transactions electronically into the point-of-sale terminal at the Delta gas station. Following false fuel transactions, Mir withdrew cash in the amount of the fraudulent transaction from the gas station’s cash register. According to statements in court, Mir used this cash for personal expenses and to pay another gas station employee for working extra hours on Mir’s behalf.
The access fraud charge carries a maximum potential penalty of 15 years in prison and a $250,000 fine. Sentencing is scheduled for Dec. 13, 2022.
U.S. Attorney Sellinger credited special agents of the Amtrak, Office of Inspector General, Eastern Region, under the direction of Special Agent in Charge Michael J. Waters; the GSA Office of Inspector General, Northeast Field Investigations Division, under the direction of Special Agent in Charge Joseph Dattoria; and postal inspectors with the U.S. Postal Inspection Service, Philadelphia Division, under the direction of Postal Inspector in Charge Damon Wood, with the investigation leading to today’s guilty plea. He also thanked the Metuchen Police Department, acting under the direction of Chief of Police Arthur Flaherty for its assistance.
The government is represented by Senior Trial Counsel Leslie Faye Schwartz of the U.S. Attorney’s Office’s Special Prosecutions Division.
Hunterdon County Man Sentenced to 33 Months in Prison for Producing Phony Massage Therapy Training Certificates for Prostitution BusinessesRead the Press Release
TRENTON, N.J. – A Hunterdon County, New Jersey, man was sentenced today to 33 months in prison for producing and selling fraudulent massage therapy training certificates for use in various New Jersey massage parlors that engaged in prostitution, U.S. Attorney Philip R. Sellinger announced.
Naresh Rane, 68, of Tewksbury, New Jersey, previously pleaded guilty before U.S. District Judge Anne E. Thompson to Count 1 of an indictment charging him with knowingly and intentionally using and causing the use of facilities in interstate commerce to promote, manage, establish, carry on, and facilitate the business of prostitution in violation of New Jersey law. U.S. District Judge Zahid N. Quraishi imposed the sentence today in Trenton federal court.
According to documents filed in this case and statements made in court:
Rane owned and operated Axiom Healthcare Academy, which purported to provide classes in massage therapy training. Rane held himself out as a businessman who, for a fee that ranged from $1,000 to $2,600, could provide massage therapy training certificates to anyone who wished to obtain a massage license without the required training. Rane was also willing to provide phony transcripts listing classes and grades.
Between November 2013 and March 2014, Rane provided 10 fraudulent massage therapy training certificates and transcripts to a former Westwood, New Jersey, councilman who then gave them to prostitutes working in different massage parlors located in Union, Passaic, Hudson and Middlesex counties. Rane admitted today that he knew the documents he was producing and selling were used to disguise prostitution activities as legitimate massage services.
In addition to the prison term, Judge Quraishi sentenced Rane to three years of supervised release.
U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge Jesse Levine in Newark, with the investigation leading to today’s sentencing.
The government is represented by Senior Litigation Counsel Mark J. McCarren of the U.S. Attorney’s Office Special Prosecutions Division in Newark.
Cumberland County Man Sentenced to 151 Months in Prison for Drug ConspiracyRead the Press Release
CAMDEN, N.J. – A Cumberland County, New Jersey, man was sentenced today to 151 months for conspiracy to distribute methamphetamine, U.S. Attorney Philip R. Sellinger announced.
Joan Benitez, 41, of Millville, previously pleaded guilty before U.S. District Judge Robert B. Kugler to an information charging him with one count of conspiracy to distribute and possess with intent to distribute over 50 grams of methamphetamine. Judge Kugler imposed the sentence today in Camden federal court.
According to documents filed in this case and statements made in court:
From Jan. 22, 2020, to Sept. 9, 2020, Benitez sold crystalized methamphetamine, also called “ice,” on behalf of a conspiracy to distribute those drugs. Benitez distributed 1.57 kilograms of methamphetamine.
In addition to the prison term, Judge Kugler sentenced Benitez to five years of supervised release.
U.S. Attorney Sellinger credited special agents of the FBI, Atlantic City Resident Agency, under the direction of Special Agent in Charge Jesse Levine in Newark, with the investigation leading to today’s sentencing. He also thanked the New Jersey State Police, the Drug Enforcement Administration, Homeland Security Investigations, the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Atlantic County Prosecutor’s Office, the Atlantic County Sheriff’s Office, the Pleasantville Police Department, and the Atlantic City Police Department, for their assistance.
The government is represented by Assistant U.S. Attorney Andrew Johns of the Criminal Division in Camden.
Atlantic City Man Admits Escape and Wire FraudRead the Press Release
CAMDEN, N.J. – An Atlantic City, New Jersey, man today admitted escaping from federal custody and engaging in a scheme to defraud women over telephone dating services, U.S. Attorney Philip R. Sellinger announced.
Patrick Giblin, 57, pleaded guilty before U.S. District Judge Robert B. Kugler in Camden federal court to an information charging him with one count of escape from the custody of the Attorney General and one count of wire fraud.
According to documents filed in this case and statements made in court:
On July 23, 2020, Giblin escaped from the custody of the Attorney General while traveling from a federal prison in Lewisburg, Pennsylvania, to a residential living facility in Newark, where he had been directed to serve the remainder of a federal prison sentence. At the time, Giblin was serving a sentence imposed in 2017 for traveling interstate and using an interstate facility to promote unlawful activity in connection with a scheme to defraud multiple women. Giblin’s 2017 sentence followed an earlier sentence of 115 months in prison for a 2007 wire fraud conviction for a similar fraud scheme. Members of the U.S. Marshals Service located and arrested Giblin in Atlantic City on March 10, 2021.
From April 2019 through March 2021 – including during the time period when he was a fugitive – Giblin posted advertisements and messages on telephone dating services. Giblin cultivated a rapport with the women he spoke to on these services, falsely claimed that he would be relocating to the woman’s geographic area, and falsely represented that he wished to pursue a committed, romantic relationship with each woman. Giblin received money from the women he spoke to on the dating services via interstate wire services such as Western Union and MoneyGram.
The charge of escape carries a maximum penalty of five years in prison and a maximum fine of $250,000, or twice the gross gain or loss from the offense, whichever is greatest. The charge of wire fraud carries a maximum penalty of 20 years in prison and a maximum fine of $250,000, or twice the gross gain or loss from the offense, whichever is greatest. Sentencing is scheduled for Nov. 16, 2022.
U.S. Attorney Sellinger credited members of the U.S. Marshals Service, District of New Jersey, under the direction of U.S. Marshal Juan Matos Jr., and special agents of the FBI, Atlantic City Resident Agency, under the direction of Special Agent in Charge Jesse Levine in Newark, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Daniel A. Friedman of the U.S. Attorney’s Office’s Criminal Division in Camden.
CEO of Dozens of Companies and Entities Charged in Scheme to Traffic an Estimated $1 Billion in Fraudulent and Counterfeit Cisco Networking EquipmentRead the Press Release
NEWARK, N.J. – A federal grand jury has indicted a Florida man for allegedly orchestrating a scheme over many years to traffic in counterfeit Cisco networking equipment with an estimated retail value of over $1 billion, Attorney for the United States Vikas Khanna, District of New Jersey, and Assistant Attorney General Kenneth A. Polite announced today.
Onur Aksoy, aka “Ron Aksoy” and “Dave Durden,” 38, of Miami, Florida, is charged by indictment, returned July 7, 2022, with one count of conspiracy to traffic in counterfeit goods and to commit mail and wire fraud; three counts of mail fraud; four counts of wire fraud; and three counts of trafficking in counterfeit goods. Aksoy was originally charged by complaint on June 29, 2022, and was arrested in Miami that day.
According to documents filed in this case and statements made in court:
Aksoy allegedly ran at least 19 companies formed in New Jersey and Florida as well as at least 15 Amazon storefronts, at least 10 eBay storefronts, and multiple other entities (collectively, the “Pro Network Entities”) that imported tens of thousands of fraudulent and counterfeit Cisco networking devices from China and Hong Kong and resold them to customers in the United States and overseas, falsely representing the products as new and genuine. The operation allegedly generated over $100 million in revenue, and Aksoy received millions of dollars for his personal gain.
The devices the Pro Network Entities imported from China and Hong Kong were typically older, lower-model products, some of which had been sold or discarded, which Chinese counterfeiters then modified to appear to be genuine versions of new, enhanced, and more expensive Cisco devices. The Chinese counterfeiters often added pirated Cisco software and unauthorized, low-quality, or unreliable components – including components to circumvent technological measures added by Cisco to the software to check for software license compliance and to authenticate the hardware. To make the devices appear new, genuine, high-quality, and factory-sealed by Cisco, the Chinese counterfeiters allegedly added counterfeited Cisco labels, stickers, boxes, documentation, packaging, and other materials.
The fraudulent and counterfeit products sold by the Pro Network Entities suffered from numerous performance, functionality, and safety problems. Often, they would simply fail or otherwise malfunction, causing significant damage to their users’ networks and operations – in some cases, costing users tens of thousands of dollars. Customers of Aksoy’s fraudulent and counterfeit devices included hospitals, schools, government agencies, and the military.
As set forth in the indictment, between 2014 and 2022, Customs and Border Protection (CBP) seized approximately 180 shipments of counterfeit Cisco devices being shipped to the Pro Network Entities from China and Hong Kong. In response to some of these seizures, Aksoy allegedly falsely submitted official paperwork to CBP under the alias “Dave Durden,” an identity that he used to communicate with Chinese conspirators. To try to avoid CBP scrutiny, Chinese conspirators allegedly broke the shipments up into smaller parcels and shipped them on different days, and Aksoy used at least two fake delivery addresses in Ohio. After CBP seized a shipment of counterfeit Cisco products to Aksoy and the Pro Network Entities and sent a seizure notice, Aksoy allegedly often continued to order counterfeit Cisco products from the same supplier.
From 2014 to 2019, Cisco sent seven letters to Aksoy asking him to cease and desist his trafficking of counterfeit goods. Aksoy allegedly responded to at least two of these letters by causing his attorney to provide Cisco with forged documents. In July 2021, agents executed a search warrant at Aksoy’s warehouse and seized 1,156 counterfeit Cisco devices with a retail value of over $7 million.
The charge of conspiracy to traffic in counterfeit goods and to commit mail and wire fraud carries a maximum potential penalty of five years in prison. The charges of mail and wire fraud each carry a maximum potential penalty of 20 years in prison. The charges of trafficking in counterfeit goods each carry a maximum potential penalty of 10 years in prison. Each charge also carries a maximum potential fine of $250,000 or twice the gross gain or loss from the offense, whichever is greatest.
Attorney for the United States Khanna and Assistant Attorney General Polite credited special agents and members of the U.S. Department of Homeland Security, Homeland Security Investigations (HSI) Los Angeles, under the direction of Acting Special Agent in Charge Eddy Wang; the U.S. Department of Defense, Defense Criminal Investigative Service, Western Field Office, under the direction of Special Agent in Charge Bryan Denny; the General Services Administration, Office of Inspector General, Southeast and Caribbean Division, under the direction of Special Agent in Charge Floyd Martinez; the U.S. Navy, Naval Criminal Investigative Service, Economic Crimes Field Office, under the direction of Special Agent in Charge Peter Tolentino; HSI Miami, under the direction of Special Agent in Charge Anthony Salisbury; HSI Newark, under the direction of Special Agent in Charge Jason J. Molina, with the investigation leading to the indictment.
The CBP Electronics Center of Excellence; the CBP Los Angeles National Targeting and Analysis Center; and the CBP Office of Trade, Regulatory Audit and Agency Advisory Services, Miami Field Office, provided valuable assistance.
Anyone who believes they may be a victim of Aksoy or the Pro Network Entities, please visit www.justice.gov/largecases or /usao-nj/united-states-v-onur-aksoy-pro-network for more information.
The government is represented by Assistant U.S. Attorney Andrew M. Trombly of the Cybercrime Unit in Newark, Senior Counsel Matthew A. Lamberti of the Department of Justice Computer Crime and Intellectual Property Section in Washington, D.C., and Senior Trial Counsel Barbara Ward of the Asset Recovery and Money Laundering Unit in Newark.
The Pro Network Entities include at least the following:
Business Entities
Pro Network Companies
Approximate Month and Year of Formation
State of Formation
Pro Network LLC
August 2013
New Jersey
Netech Solutions LLC
November 2016
Florida
Target Network Solutions LLC
January 2017
Florida
Easy Network LLC
April 2017
New Jersey
ACE NETUS LLC (a/k/a Ace Network)
April 2017
New Jersey
My Network Dealer LLC
April 2017
New Jersey
1701 Doral LLC
May 2017
New Jersey
Maytech Trading LLC
August 2017
Florida
NFD Trading LLC
September 2017
Florida
Kenet Solutions LLC
September 2017
Florida
Team Tech Global LLC
January 2018
New Jersey
Tenek Trading LLC
January 2018
Florida
The Network Gears LLC
February 2018
Florida
All Networking Solutions LLC (a/k/a All Network)
April 2018
Florida
San Network LLC
October 2018
Florida
Pro Network US Inc.
January 2019
Florida
Jms Tek LLC
August 2019
Florida
Renewed Equipment LLC
August 2021
Florida
Pro Ship US LLC
August 2021
Florida
Pro Network Amazon Storefronts
Pro Network Amazon Storefront
Approximate Date of Earliest
Known Activity
Albus Trade Hub
January 2014
EasyNetworkUS
March 2014
Get Better Trade
July 2015
Mercadeal
February 2017
Netech Solutions
February 2018
Netkco LLC
September 2014
NFD Trading LLC
January 2018
Palm Network Solutions
June 2017
Renewed Equip
August 2017
Servtaur
August 2019
Smart Network
July 2017
SOS Tech Trade
August 2017
Target-Solutions
September 2020
TeamTech Global
March 2016
TradeOrigin US
August 2015
Pro Network eBay Storefronts
Pro Network eBay Storefront
Approximate Date of Earliest
Known Activity
connectwus
March 2014
futuretechneeds
July 2017
getbettertrade
July 2017
getontrade
April 2016
maytechtradingllc
October 2017
netechsolutions
April 2017
netkco
September 2014
nfdtrading
February 2018
smartnetworkusa
January 2014
tenektradingllc
May 2018
The charges and allegations contained in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Woman Accused of Murder in Texas Charged with Misuse of Passport while Leaving the United StatesRead the Press Release
NEWARK, N.J. – An Austin, Texas, woman was charged today for using a passport belonging to another individual when she flew out of Newark Liberty International Airport, U.S. Attorney Philip R. Sellinger announced.
Kaitlin Armstrong, 34, is charged by complaint with one count of misuse of a passport. Armstrong will make her initial appearance at a date to be determined.
According to the complaint:
The city of Austin, Texas, obtained an arrest warrant for Armstrong on May 17, 2022, for a murder that allegedly occurred on May 11, 2022, in Austin. The victim died after suffering multiple gunshot wounds. On May 12, 2022, Austin Police Department officers interviewed Armstrong about the death. Armstrong flew from Texas to New York La Guardia Airport in Queens, New York, two days later.
On May 18, 2022, Armstrong boarded a flight from Newark Liberty International Airport to Juan Santamaría Airport in Costa Rica after presenting a ticket and United States passport in the name of another individual known to Armstrong, and whom Armstrong represented as herself. On June 29, 2022, law enforcement officers apprehended Armstrong in Costa Rica, where she was in possession of both her own passport and the passport that she presented to officials when she flew from Newark Liberty International Airport.
Misuse of a passport carries a maximum potential penalty of 10 years in prison and a maximum fine of $250,000.
U.S. Attorney Sellinger credited the U.S. Marshals Service, under the direction of U.S. Marshal for the Western District of Texas Susan Pamerleau; and special agents of the U.S. Department of State, Diplomatic Security Service, New York Field Office, under the direction of Special Agent in Charge Keith Byrne. He also thanked the U.S. Attorney’s Office for the Western District of Texas, Homeland Security Investigations, the Austin Police Department, and U.S. Customs and Border Protection, for their assistance with the investigation.
The government is represented by Assistant U.S. Attorney Garrett Schuman of the General Crimes Unit in Newark.
The charge and allegations contained in the complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Six People Charged with Fraudulently Obtaining Loans Meant to Help Small Businesses During COVID-19 PandemicRead the Press Release
NEWARK, N.J. – Six Essex County, New Jersey, residents were arrested today for scheming to fraudulently obtain Paycheck Protection Program (PPP) loans, U.S. Attorney Philip R. Sellinger announced.
Nyan Terry, aka “Racks,” 23, of Irvington; Samir Jefferson, aka “Tank Jeffe,” 23, of Newark; and Nasir Williams, aka “Harlem Pete,” 29, Hymeen Reynolds, aka “Meen,” 21, Brian Brown, aka “Bizz,” 40, and Cadece Lapread, 35, all of East Orange, are each charged by complaint with one count of bank fraud. Terry, Reynolds, Brown, Lapread, and Jefferson are also charged with one count each of bank fraud conspiracy. The defendants made their initial appearances today before U.S. Magistrate Judge Jessica S. Allen.
According to documents filed in this case and statements made in court:
The Coronavirus Aid, Relief, and Economic Security (CARES) Act is a federal law enacted in March 2020 and was designed to provide emergency financial assistance to the millions of Americans suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of hundreds of billions of dollars in forgivable loans to small businesses for job retention and certain other expenses, through the PPP.
To obtain a PPP loan, a qualifying small business was required to apply and provide information on its operations, including the number of employees and expenses. In addition, businesses generally had to provide supporting documentation.
In April and May 2021, Terry, Jefferson, Williams, Reynolds, Brown, and Lapread schemed to defraud PPP lenders by submitting fraudulent PPP loan applications in the names of nonexistent small businesses, along with forged tax forms. Based on the defendants’ misrepresentations, lenders approved at least three fraudulent PPP loans and disbursed more than $62,000 in federal COVID-19 emergency relief funds.
The counts of bank fraud and bank fraud conspiracy each carry a maximum penalty of 30 years in prison and a maximum fine of $1 million.
U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge Jesse Levine in Newark; special agents of the Department of Homeland Security, Homeland Security Investigations, under the direction of Special Agent in Charge Jason J. Molina in Newark; and special agents of IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Tammy Tomlins, with the investigation leading to the charges. He also thanked the Bloomfield Police Department, the Essex County Sheriff’s Office, the Essex County Prosecutor’s Office, and the Newark Department of Public Safety for their assistance in the investigation.
The government is represented by Special Assistant U.S. Attorney Timothy Shaughnessy and Assistant U.S. Attorney Sarah A. Sulkowski of the U.S. Attorney’s Organized Crime/Gangs Unit in Newark.
The charges and allegations contained in the complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
U.S. Attorney Philip R. Sellinger Recognizes Newark Public Safety Director Brian O’Hara’s Significant Contributions to Cooperative Law EnforcementRead the Press Release
NEWARK, N.J. – City of Newark Deputy Mayor and former Public Safety Director Brian O’Hara was recognized today by the U.S. Attorney’s Office for the District of New Jersey for his unwavering commitment to cooperative law enforcement in the state of New Jersey, U.S. Attorney Philip R. Sellinger announced.
On June 30, 2022, Newark Mayor Ras Baraka elevated O’Hara to deputy mayor of Newark. In February 2021, Baraka appointed O’Hara to be public safety director and he began his service in that role in March 2021, overseeing more than 1,960 employees, comprising 996 sworn police officers, 611 firefighters, and 346 civilian employees, and a budget that exceeded $200 million.
“Director O’Hara's service has been defined by his commitment to reforming policing and his fidelity to partnering with other law enforcement agencies to protect the people of Newark,” U.S. Attorney Sellinger said. “Through his leadership, we have maintained our indispensable cooperation and proactive participation in our efforts to confront and suppress violent crime in the great city of Newark. During his career, he brought reform and transparency to police practices by leading the Newark Police Department’s implementation of the Department of Justice’s Consent Decree. Under Director O’Hara ‘s leadership, the Police Department’s crime suppression efforts improved upon the record levels of violent crime reduction that were met in 2020.”
As the leader of the city of Newark’s Department of Public Safety, Director O’Hara has enhanced the collaborative working relationships among federal, state, and local partners, including the U.S. Attorney’s Office, the Newark Police Department, the Essex County Prosecutor’s Office, the FBI, the Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the New Jersey State Police, the New Jersey Attorney General’s Office, the New Jersey Office of Homeland Security & Preparedness, and numerous other state and local agencies and police departments. Director O’Hara’s commitment to the Newark Violent Crime Initiative (VCI), the U.S. Attorney’s Office’s multi-agency cooperative effort aimed at combatting violent crime in and around vulnerable communities, has saved lives and lessened the scourge of gun violence. As other communities experience significant increases in gun violence, Director O’Hara to date this year has led the Newark Police Department to a 29 percent decrease in total shooting incidents, and a 26 percent decrease in shooting murder victims. Under Director O’Hara’s stewardship, the Newark Police Department has less total shooting incidents and shooting murder victims than it did at this point in 2018, 2019, 2020, and 2021.
“The city of Newark was well served by Director O’Hara’s relentless efforts to prioritize the safety of the people in this wonderful community,” U.S. Attorney Sellinger said.
Director O’Hara received both his Bachelor of Science and Master of Arts in criminal justice from Rutgers University. In 2001, Director O’Hara joined the Newark Police Department as a police officer, rising through the ranks to become a captain in 2016.
Atlantic City Man Sentenced to 125 Months in Prison for Conspiring to Distribute Kilogram Quantities of HeroinRead the Press Release
CAMDEN, N.J. – A member of an Atlantic City, New Jersey, drug-trafficking organization was sentenced today to 125 months in prison for conspiring to distribute one kilogram or more of heroin, U.S. Attorney Philip R. Sellinger announced.
Terryn Kelsey, 32, of Atlantic City, previously pleaded guilty before U.S. District Judge Robert B. Kugler to an indictment charging him with one count of conspiracy to distribute and possess with intent to distribute more than one kilogram of heroin. Judge Kugler imposed the sentence today in Camden federal court.
Seventeen other members of the drug trafficking conspiracy – Khalif Toombs, Tyjuan Demarest, Nasir Brown, Karon Carey, James Blackwell, Philip Surace, David Ramirez, Wilbert Toombs, Quadir Stanley, Dean Johnson, Khalif Davis, Joseph Aversa, Thomas Randall, Mayda Hernandez, Sarah Taliaferro, Wayne Burnside, and Blaine Dorsey – previously have pleaded guilty. Of those 17 defendants, 15 have been sentenced to prison terms ranging from eight to 135 months. The charges against four other defendants, Jeremy Carll, Valarie Lamar, Tieyesha Tucker, and Jamal Marshall, remain pending.
According to documents filed in the case and statements made in court:
Kelsey, along with leader Khalif Toombs and other members of the drug conspiracy, trafficked heroin from Patterson, New Jersey and into Atlantic City throughout the course of the investigation. Kelsey admitted in court to conspiring with others to traffic between one and three kilograms of heroin during this time and to operating Toombs’ cellular phone to further the conspiracy. The investigation tracked multiple stamps of heroin being distributed by Toombs and others, including, “AK-47,” “Apple,” “Fortnite,” “Rolex,” “Frank Lucas,” “Bentley,” “Pandora,” and “9 ½.” Between Jan. 1, 2017, and June 21, 2019, those stamps accounted for 48 deaths and 84 non-fatal overdoses in New Jersey.
In addition to the prison term, Judge Kugler sentenced Kelsey to five years of supervised release.
U.S. Attorney Sellinger credited special agents of the FBI’s Safe Streets South Jersey Violent Incident and Gang Task Force, Atlantic City Resident Agency, and FBI, Newark, under the direction of Special Agent in Charge Jesse Levine; officers of the Atlantic City Police Department, under the direction of Deputy Chief James A. Sarkos, the Interim Officer in Charge; the Atlantic County Prosecutor’s Office, under the direction of Acting Prosecutor William E. Reynolds; the Atlantic County Sheriff’s Department, under the direction of Sheriff Eric Scheffler; and the Pleasantville Police Department, under the direction of Chief Sean Riggin, with the investigation leading to today’s pleas. He also thanked the U.S. Department of Homeland Security, Homeland Security Investigations; the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives; the Drug Enforcement Administration; and the N.J. State Police for their assistance.
This case is being conducted as part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
The government is represented by Assistant U.S. Attorneys Martha K. Nye of the U.S. Attorney’s Office Criminal Division in Trenton and Elisa T. Wiygul of the U.S. Attorney’s Office Criminal Division in Camden.
For the four defendants whose charges remain pending, the charges and allegations are merely accusations, and they are presumed innocent unless and until proven guilty.
Passaic County Accountant Admits Subscribing to False Returns and Conspiring to Defraud United StatesRead the Press Release
NEWARK, N.J. – A Passaic County, New Jersey, man who was employed as a certified public accountant in northern New Jersey today admitted failing to disclose income on his tax returns, U.S. Attorney Philip R. Sellinger announced.
William Kawam, 57, of Hewitt, New Jersey, pleaded guilty by videoconference before U.S. District Judge Madeline Cox Arleo to an information charging him with subscribing to false tax returns and conspiracy to defraud the United States.
According to documents filed in this case and statements made in court:
In 2015, Kawam and a conspirator undertook a scheme to conceal certain money from the IRS. The conspirator compensated Kawam for a portion of his accounting services by providing him with a credit card belonging to one of the conspirator’s businesses that Kawam could use for personal expenses. Kawam failed to report the charges as income, and the conspirator failed to report the charges as business expenses. Kawam failed to report $146,605 for tax years 2015, 2016, and 2017, resulting in a tax loss of approximately $54,400.
The count of subscribing to false tax returns to which Kawam pleaded guilty carries a maximum penalty of three years in prison and a $100,000 fine; the conspiracy to defraud the United States count carries a maximum penalty of five years in prison and a $250,000 fine. Sentencing is scheduled for Nov. 21, 2022.
U.S. Attorney Sellinger credited special agents of IRS - Criminal Investigation, under the direction of Acting Special Agent in Charge Tammy Tomlins, and special agents of the FBI, under the direction of Acting Special Agent in Charge Terence Reilly in Newark, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Shawn Barnes of the U.S. Attorney’s Office’s Economic Crimes Unit in Newark.
Morris County Man Charged with Distribution and Possession of Child PornographyRead the Press Release
NEWARK, N.J. – A Morris County, New Jersey, man was arrested for distributing and possessing videos of child sexual abuse, U.S. Attorney Philip R. Sellinger announced today.
Bryan Wesselius, 45, of Whippany, New Jersey, is charged by complaint with one count of distribution of child pornography and one count of possession of child pornography. He appeared by videoconference today before U.S. Magistrate Judge Cathy L. Waldor and was released on $100,000 unsecured bond, with home detention and electronic monitoring.
According to documents filed in this case and statements made in court:
From September 2021 through May 2022, Wesselius distributed material containing video files of child sexual abuse via a publicly available online peer-to-peer (P2P) file-sharing program, which allows internet users to trade digital files. An undercover law enforcement officer conducted online sessions using the (P2P) program. During multiple sessions, a user shared multiple files featuring videos of child sexual abuse from an IP address traced to Wesselius’ address. Law enforcement officials later recovered one file previously shared during one of those sessions from one of Wesselius’ electronic devices.
The count of distribution of child pornography carries a mandatory minimum penalty of five years in prison, a maximum penalty of 20 years in prison, and a fine of $250,000. The count of possession of child pornography carries a maximum penalty of 10 years in prison, and a fine of $250,000.
U.S. Attorney Sellinger credited special agents of the U.S. Department of Homeland Security, Homeland Security Investigations, New Jersey Division, under the direction of Special Agent in Charge Jason J. Molina, with the investigation leading to the charges. He also thanked the Boonton Township Police Department under the direction of Chief Michael Danyo, the Morris County Prosecutor’s Office under the direction of Prosecutor Robert J. Carroll, the Hanover Township Police Department under the direction of Chief Michael Loock and the U.S. Postal Inspection Service in Newark, under the direction of Inspector in Charge Damon Wood, Philadelphia Division, for their assistance with the investigation.
The government is represented by Assistant U.S. Attorney Clara Kim of the 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.
Essex County Man Sentenced to Five Years in Prison for Drug DistributionRead the Press Release
NEWARK, N.J. – An Essex County, New Jersey, man was sentenced today to 60 months in prison for conspiring to distribute cocaine base and distributing fentanyl and cocaine base, U.S. Attorney Philip R. Sellinger announced.
Marvin Lagrier, aka “Black Jesus,” 40, of Newark, previously pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to a superseding information charging him with one count of possession with intent to distribute 40 grams or more of fentanyl. Lagrier was a Newark Housing Authority employee at the time of his arrest. Judge Arleo imposed the sentence today by videoconference.
A codefendant, Tyrell Wilson, aka “Hell Rell,” 37, of Rahway, New Jersey, previously pleaded guilty to an information charging him with one count of conspiracy to distribute 280 grams or more of cocaine base and one count of possession with intent to distribute 280 grams or more of cocaine base. Judge Arleo sentenced Wilson on Feb. 14, 2022, to 10 years in prison.
According to documents filed in this case and statements made in court:
On Sept. 19, 2019, law enforcement officers approached an apartment in Essex County, New Jersey, to execute a court-authorized search warrant. Wilson and Lagrier exited the apartment and attempted to flee the area but were apprehended and placed under arrest. Upon searching the apartment, as well as Wilson’s vehicle and a backpack that Wilson discarded while fleeing, law enforcement officers recovered a large amount of cocaine base, heroin, and fentanyl as well as many items of drug paraphernalia for packaging narcotics. Law enforcement officers also recovered a firearm and several rounds of ammunition as well as several cellular phones. They also recovered several brown Newark Housing Authority uniforms bearing the name tag, “Marvin,” which matched the uniform that Lagrier wore at the time of his arrest.
In addition to the prison term, Judge Arleo sentenced Lagrier to four years of supervised release.
U.S. Attorney Sellinger credited special agents of the DEA, under the direction of Special Agent in Charge Susan A. Gibson in Newark, and members of the Newark Police Department, under the direction of Public Safety Director Brian O’Hara, with the investigation leading to today’s sentencing.
This case is part of the Violent Crime Initiative (VCI), which was formed in August 2017 by the U.S. Attorney’s Office for the District of New Jersey, the Essex County Prosecutor’s Office, and the City of Newark’s Department of Public Safety for the purpose of combatting violent crime in and around Newark. As part of this partnership, federal, state, county, and city agencies collaborate and pool resources to prosecute violent offenders who endanger the safety of the community. The VCI is composed of the U.S. Attorney’s Office, the FBI, the ATF, the DEA, the U.S. Marshals, the Newark Department of Public Safety, the Essex County Prosecutor’s Office, the Essex County Sheriff’s Office, N.J. State Parole, Union County Jail, N.J. State Police Regional Operations and Intelligence Center/Real Time Crime Center, N.J. Department of Corrections, the East Orange Police Department, the Orange Police Department and the Irvington Police Department.
The government is represented by Assistant U.S. Attorney Tracey Agnew and Special Assistant U.S. Attorney Kendall Randolph of the U.S. Attorney’s Office Organized Crime/Gang Unit in Newark.
Apple’s Former Director of Corporate Law Admits Insider TradingRead the Press Release
NEWARK, N.J. – The former corporate secretary and director of corporate law at Apple today admitted engaging in an insider trading scheme that spanned five years, Attorney for the United States Vikas Khanna announced.
Gene Levoff, 48, of San Carlos, California, pleaded guilty by videoconference before U.S. District Judge William J. Martini to six counts of an indictment charging him with securities fraud. Levoff was initially charged by complaint in February 2019.
“Gene Levoff betrayed the trust of one of the world’s largest tech companies for his own financial gain,” Attorney for the United States Khanna said. “Despite being responsible for enforcing Apple’s own ban on insider trading, Levoff used his position of trust to commit insider trading in order to line his own pockets. This Office will continue to prioritize securities fraud prosecutions.”
“This defendant exploited his position within a company strictly for financial gain that he would not have otherwise realized,” Terence Reilly, FBI Acting Special Agent in Charge in Newark, said. “That’s called ‘gaming the system.’ Insider trading is not just illegal, it is a threat to the viability of our markets. The average American, whose retirement savings is invested in these companies, has every right to expect that rules are being followed, the game is being played fairly, and their nest egg is safe from profiteers who willingly sidestep the rules to improve their own financial future at the expense of others. The FBI is here to make sure the playing field is level.”
According to documents filed in this case and statements made in court:
From February 2011 to April 2016, Levoff – the top corporate attorney at Apple who also served as the company’s assistant secretary and corporate secretary – misappropriated material, nonpublic information about Apple’s financial results and then executed trades involving the company’s stock. This scheme to defraud Apple and its shareholders allowed Levoff to realize profits of approximately $227,000 on certain trades and to avoid losses of approximately $377,000 on others.
Specifically, Levoff was co-chairman of Apple’s Disclosure Committee, which reviewed and discussed the company’s draft quarterly and yearly earnings materials and periodic U.S. Securities and Exchange Commission (SEC) filings before they were publicly disclosed. Levoff mined these materials for inside information about Apple to guide his decisions to buy and sell Apple stock ahead of its earnings announcements. When Apple posted strong revenue and net profit for a given financial quarter, he purchased large quantities of stock, which he later sold for a profit once the market reacted to the news. When there were lower-than-anticipated revenue and net profit, Levoff sold large quantities of Apple stock, avoiding significant losses.
Levoff was subject to Apple’s regular quarterly “blackout periods,” which prohibited individuals who had access to material nonpublic information from engaging in trades until a certain period after the company disclosed its financial results to the public. Levoff ignored this restriction, as well as the company’s broader Insider Trading Policy – which he was responsible for enforcing – and instead repeatedly executed trades based on material, nonpublic information without Apple’s knowledge or authorization. On several occasions, Levoff executed trades within a blackout period after notifying other individuals subject to the restriction that they were prohibited from buying or selling Apple stock until the blackout period terminated.
The securities fraud counts each carry a maximum penalty of 20 years in prison and a $5 million fine. Sentencing is scheduled for Nov. 10, 2022.
The SEC previously filed a civil complaint against Levoff based on the same conduct.
Attorney for the United States Khanna credited special agents of the FBI, under the direction of Acting Special Agent in Charge Reilly, with the investigation leading to today’s guilty plea. He also thanked the SEC, for the assistance provided by its Enforcement Division, and Apple, which cooperated with law enforcement over the course of the investigation.
The government is represented by Daniel V. Shapiro, Deputy Chief of the Criminal Division.
New York Man Admits Scheme to Deposit over $550,000 in Altered Checks Stolen from MailRead the Press Release
NEWARK, N.J.– A New York man today admitted his role in a scheme to alter and deposit hundreds of checks stolen from mailboxes across New Jersey, U.S. Attorney Philip R. Sellinger announced.
Nigel Lynch, 21, of Yonkers, New York, pleaded guilty by videoconference before U.S. District Judge Katharine S. Hayden to an information charging him with one count of bank fraud conspiracy and one count of conspiracy to receive and possess stolen mail.
According to documents filed in the case and statements made in court:
From February to November 2020, Lynch and two conspirators stole over 290 checks from New Jersey mailboxes in Morris, Essex, Somerset, and Passaic counties. They then altered the stolen checks and deposited them into bank accounts controlled by Lynch and his conspirators. After the stolen checks were deposited, Lynch and his conspirators withdrew cash from the accounts totaling over $550,000.
The bank fraud charge conspiracy charge carries a maximum penalty of 30 years in prison and a $1 million fine; and the conspiracy to receive and possess stole mail carries a maximum sentence of five years in prison and a $250,000 fine. Sentencing is scheduled for Nov. 8, 2022.
U.S. Attorney Sellinger credited postal inspectors of the U.S. Postal Inspection Service in Newark, under the direction of Inspector in Charge Damon Wood, Philadelphia Division, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Blake Coppotelli of the U.S. Attorney’s Office Economic Crimes Unit.
New York Doctor Admits Health Care Fraud Targeting Amtrak, Drug Distribution, and Unlawful Possession of FirearmRead the Press Release
NEWARK, N.J. – A New York doctor today admitted participating in a health care fraud scheme to defraud Amtrak, distribution of a controlled substance in furtherance of that scheme, and the unlawful possession of a firearm, U.S. Attorney Philip R. Sellinger announced.
Michael DeNicola, 59, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to an information charging him with conspiracy to commit health care fraud, distribution of a controlled substance, and unlawful possession of a firearm.
According to documents filed in this case and statements made in court:
From 2019 to August 2021, DeNicola and his conspirators agreed to engage in a scheme to bill the Amtrak health care plan for fraudulent claims for services that either were never provided or were medically unnecessary. They would recruit Amtrak employees to participate in the scheme by paying them to allow the conspirators to use their patient and insurance information to submit false and fraudulent claims. DeNicola and his conspirators submitted false and fraudulent claims that caused Amtrak losses of more than $1.6 million.
DeNicola also provided oxycodone prescriptions to an individual in return for the individual’s agreement to allow his patient and insurance information to be used for the submission of fraudulent insurance claims. DeNicola provided oxycodone prescription to others at the direction of this individual and did so outside of the usual course of professional treatment and without legitimate medical purpose. From April 2017 through February 2018, DeNicola issued 64 oxycodone prescriptions in this manner.
DeNicola also unlawfully possessed a firearm on Sept. 1, 2019, after previously having been convicted in a court of a crime punishable by a term of imprisonment exceeding one year.
The conspiracy to commit health care fraud and unlawful possession of a firearm charges each carry a maximum potential penalty of 10 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense, whichever is greatest. The distribution of a controlled substance charge carries a maximum potential penalty of 20 years in prison and a $1million fine, or twice the gross gain or loss from the offense, whichever is greatest. Sentencing is scheduled for Nov. 22, 2022.
U.S. Attorney Sellinger credited special agents of the Amtrak Office of Inspector General, under the direction of Special Agent in Charge Michael J. Waters; special agents of the Drug Enforcement Administration, under the direction of Special Agent in Charge Frank A. Tarentino III in New York; special agents of the FBI, under the direction of Assistant Director in Charge Michael J. Driscoll in New York; the U.S. Food and Drug Administration Office of Criminal Investigations, under the direction of Acting Special Agent in Charge Bradley Greenberg; postal inspectors of the U.S. Postal Inspection Service in Newark, under the direction of Postal Inspector in Charge Damon Wood, Philadelphia Division; and the Amtrak Police Department, under the direction of Chief of Police Samuel Dotson, with the investigation, leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Katherine Romano of the Health Care Fraud Unit in Newark and Daniel V. Shapiro, Deputy Chief of the Criminal Division.
Essex County Man Admits Conspiracy to Commit RacketeeringRead the Press Release
NEWARK, N.J. – An Essex County, New Jersey, man today admitted conspiring to murder a federal witness to protect a drug trafficking enterprise of which he was a member, U.S. Attorney Philip R. Sellinger announced.
Ali Hill, 29, of East Orange, New Jersey, pleaded guilty before U.S. District Judge John Michael Vazquez to one count of a superseding indictment charging him with racketeering conspiracy.
According to documents filed in this case and statements made in court:
From 2013 to March 12, 2018, Hill was a member of a drug trafficking enterprise responsible for distributing cocaine, heroin, marijuana and fentanyl in and around Newark. Hill became aware that another member of the enterprise was cooperating with federal law enforcement authorities in an investigation into illegal activity. Hill aided other members of the the enterprise in planning the murder of the victim, who was shot to death on March 12, 2018, as the victim walked his dog near a park in Bloomfield, New Jersey.
The count of racketeering conspiracy carries a maximum sentence of life in prison and a $250,000 fine. Sentencing is scheduled for Nov. 3, 2022.
U.S. Attorney Sellinger credited members of the East Orange Police Department, under the direction of Chief William C. Robinson, and special agents of the FBI, under the direction of Special Agent in Charge Jesse Levine in Newark, with the investigation leading to today’s guilty plea. He also thanked the Essex County Prosecutor’s Office, under the direction of Prosecutor Theodore N. Stephen II, for its assistance.
The government is represented by Assistant U.S. Attorneys Robert Frazer and Naazneen Khan of the Organized Crime and Gangs Unit in Newark.
Two Indian Nationals Admit Receiving over $1.2 Million in Global Robocall Scam That Defrauded Elderly VictimsRead the Press Release
NEWARK, N.J. – Two Indian nationals admitted to conspiracy to commit wire fraud by accepting illegally obtained $1.2 million in wire transfers from victims across the country, U.S. Attorney Philip R. Sellinger announced.
Arushobike Mitra, 27, and Garbita Mitra, 24, pleaded guilty before U.S. District Judge Esther Salas in Newark federal court to an information charging them each with one count of conspiracy to commit wire fraud.
According to documents filed in this case and statements made in court:
As part of an international fraud scheme, criminal India-based call centers utilized automated robocalls to victims across the country with the intent of defrauding U.S. residents, particularly the elderly. After establishing contact with victims through these automated calls, other members of the conspiracy would coerce or trick the victims into sending large sums of cash through physical shipments or wire transfers to other members of the conspiracy, including the Mitras. These conspirators used a variety of schemes to convince victims to send money, including impersonating government officials from agencies such as the Social Security Administration, or impersonating law enforcement officers from the FBI or DEA, and threatened victims with severe legal or financial consequences if they did not comply. Another method utilized by the callers involved convincing the victim they were speaking with someone from a tech support company and coercing the victim into granting the caller remote access to their personal computers. The caller would then access the victim’s bank accounts and make it appear to the victim that the caller had inadvertently added money to the victim’s bank account, when in fact the caller had simply transferred money from another one of the victim’s own accounts. The caller would then instruct the victim to “return” the money by way of mail or wire transfer to other members of the conspiracy, including the Mitras. Arushobike Mitra and Garbita Mitra are charged with receiving fraudulent transfers of cash from 48 victims across the country totaling more than $1.2 million.
The conspiracy to commit wire fraud charge carries a maximum penalty of 20 years in prison and a $250,000 fine of twice the amount of the loss, whichever is greater. Sentencing for both defendants is scheduled for Dec. 13, 2022.
U.S. Attorney Sellinger credited special agents of the Social Security Administration, Office of the Inspector General, Office of Investigations, New York Field Division, under the direction of Special Agent in Charge Sharon MacDermott; special agents of the Department of Homeland Security, Homeland Security Investigations, Cyber Intrusion Group, and El Dorado Task Force Asset Identification & Removal Group, under the direction of Special Agent in Charge, Peter C. Fitzhugh in New York; postal inspectors of the U.S. Postal Inspection Service in Newark Division, under the direction of Inspector in Charge Damon Wood, Philadelphia Division, with the investigation leading to today’s guilty pleas. He also thanked the Hoboken Police Department, the Hudson County Prosecutor’s Office, the New York City Police Department, and the Brunswick County, North Carolina, Sheriff’s Office for their assistance.
The government is represented by Special Assistant U.S. Attorney Meriah Russell of the U.S. Attorney's Office Criminal Division in Camden.
Sussex County Woman Admits Concealing Terrorist Financing to Syrian Foreign Terrorist OrganizationsRead the Press Release
NEWARK, N.J. – A Sussex County, New Jersey, woman today admitted that she concealed her attempts to provide material support to Syrian foreign terrorist organizations, U.S. Attorney Philip R. Sellinger, Assistant Attorney General Matthew G. Olsen of the U.S. Department of Justice’s National Security Division, FBI-Newark Special Agent in Charge Jesse Levine, and FBI Assistant Director for Counterterrorism Timothy Langan announced.
Maria Bell, aka “Maria Sue Bell,” 54, of Hopatcong, New Jersey, pleaded guilty before U.S. District Judge John Michael Vazquez to an information charging her with one count of concealing attempts to provide material support to designated foreign terrorist organizations.
According to documents previously filed in this case:
Bell admitted that from February 2018 to November 2018 she knowingly concealed and disguised the nature, location, source, ownership and control of the attempted provision of material support and resources to fighters based in Syria who were members Jabhat Fath al-sham, also known as Jabhat Fateh al-Sham (JFS) and Hay’at Tahrir al-Sham (HTS). Bell admitted that she knew JFS and HTS were designated foreign terrorist organizations, that JFS and HTS has engaged or engages in terrorist activities. She admitted the offense to which she pleaded guilty involved the concealment of the attempted provision of funds or other material support or resources with the intent, knowledge, or reason to believe they were to be used to commit or assist in the commission of a violent act.
The charge of concealment of terrorist financing to a designated foreign terrorist organization carries a maximum penalty of 10 years in prison and a fine of $250,000, or twice the gross gain or loss from the offense. Sentencing is scheduled for Nov. 21, 2022.
U.S. Attorney Sellinger credited special agents of the FBI and task force officers of the Joint Terrorism Task Force, under the direction of Special Agent in Charge Jesse Levine, and special agents of the U.S. Department of Homeland Security, Homeland Security Investigations, under the direction of Special Agent in Charge Jason J. Molina in Newark, with the investigation leading to the charges.
The government is represented by Joyce M. Malliet, Chief of the U.S. Attorney’s Office’s National Security Unit and Trial Attorneys Brenda Sue Thornton and Kathleen Campbell of the U.S. Department of Justice’s Counterterrorism Section of the National Security Division.
Pharmacist Admits Filling Counterfeit Prescriptions Selling Oxycodone and Codeine in Exchange for CashRead the Press Release
NEWARK, N.J. – A pharmacist and pharmacy owner pleaded guilty today to violating the Controlled Substances Act by filling fraudulent and counterfeit prescriptions in exchange for cash, U.S. Attorney Philip R. Sellinger announced.
Anthony Duncan, 61, of Hillside, New Jersey, pleaded guilty before U.S. District Judge William J. Martini in Newark federal court to an information charging him with one count of conspiracy to distribute and possess with intent to distribute oxycodone and codeine.
According to documents filed in this case and statements made in court:
Duncan was a licensed pharmacist who owned and operated Parkway Central Pharmacy in East Orange, New Jersey. Duncan’s conspirators obtained bogus prescriptions for controlled substances, including oxycodone and codeine. They brought those bogus prescriptions to Duncan at Parkway Central, who filled the prescriptions knowing that they were false or counterfeit and that he was prohibited from dispensing controlled substances without a valid prescription.
Duncan accepted cash payments from his conspirators in exchange for filling the fraudulent and counterfeit prescriptions and dispensing controlled substances. He was generally paid $4 for every oxycodone 30mg pill; $2 for every oxycodone and acetaminophen combination product; and $10 for every eight ounces of cough syrup containing codeine. From November 2014 through November 2018, Duncan filled more than 1,100 false or counterfeit prescriptions for controlled substances. He illegally sold to one conspirator at least 47,000 tablets of Oxycodone 30 mg; 46,000 tablets of oxycodone and acetaminophen combination product; and 56,000 milliliters of cough syrup containing codeine.
The count of conspiracy to distribute and possess with intent to distribute oxycodone and codeine is punishable by a maximum penalty of 20 years in prison and a fine of up to $1 million, or twice the gross profit to the defendant, whichever is greater. Sentencing is scheduled for Nov. 8, 2022.
U.S. Attorney Sellinger credited special agents of the Drug Enforcement Administration, under the direction of Special Agent in Charge Susan A. Gibson, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Hayden M. Brockett of the Health Care Fraud Unit in Newark.
New Jersey Man Convicted of Several Child Pornography Charges after Throwing Electronic Devices into BayRead the Press Release
TRENTON, N.J. – A Middlesex County, New Jersey, man was convicted of several counts involving images of child sexual abuse, U.S. Attorney Philip R. Sellinger announced today.
Charles F. Browne, 52, of South River, New Jersey, was found guilty on June 27, 2022, following a six-day trial before U.S. District Judge Michael A. Shipp in Trenton federal court of receiving child pornography, soliciting child pornography, possessing prepubescent child pornography, and concealing objects to impede the FBI’s investigation.
According to documents filed in this case and the evidence at trial:
In September 2017, a cloud-based file service noticed that apparent child sex abuse material had been uploaded to, and maintained in, an account with the screen name “Charles Browne” and an email address containing the term “cbrowne.” The FBI obtained the files that were uploaded to the online account, which included prepubescent child pornography and two copies of Browne’s resume.
On April 8, 2019, law enforcement officers stopped Browne’s vehicle as he left his residence. Brown was given a Miranda warning and interviewed by law enforcement officers about the FBI’s ongoing child exploitation investigation. Browne initially denied having an iPad and then, in response to the agent’s question at the conclusion of the interview asking where his iPad was, responded that it was at home, which was approximately one mile away. Law enforcement officers told Browne that an online file account contained two images of prepubescent child sexual abuse created by an Apple iPhone Model 5C camera. Browne denied knowledge of the child pornography. At the conclusion of the interview, Browne was dropped off at his vehicle, which was locked.
At trial, Browne confessed that he broke into his vehicle after the FBI interview, removed an iPad and his iPhone, and then walked to a local private beach club. Browne was observed by a neighbor as he walked to the end of the dock and threw his iPad and iPhone into the bay.
After Browne returned to his residence without his electronic devices, the FBI conducted a canvass of the area and located the neighbor who had observed Browne throwing his iPad into the bay. The FBI sent in a dive team, which recovered Browne’s iPad and iPhone – an Apple Model 5C – from the bay.
The devices were repaired; review of the data recovered from the devices revealed videos and images of child sexual abuse. Web history from the iPad reflected that Browne had sought out images of child sexual abuse on the iPad the day before law enforcement officers interviewed Browne. Evidence from Browne’s iPad and iPhone reflected that Browne sent emails to others seeking child pornography “vids.”
The counts of receipt of child pornography and solicitation of child pornography each carries a mandatory minimum penalty of five years in prison, a maximum penalty of 20 years in prison, and fine of $250,000. The count of possession of prepubescent child pornography carries a maximum penalty of 20 years in prison and a fine of $250,000. The count of concealing objects to impede a federal investigation count carries a maximum penalty of 20 years in prison and a fine of $250,000. Sentencing is scheduled for Nov. 9, 2022.
U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge Jesse Levine of the Newark Division, Assistant Director Michael Driscoll of the New York Division, and Special Agent in Charge Johnnie Sharp Jr., of the Birmingham Division; the Monmouth County Prosecutor’s Office, under the direction of Acting Prosecutor Lori Linskey; the Monmouth County Sherriff’s Office, under the direction of Sheriff Shaun Golden; the Ocean County Sherriff’s Office, under the direction of Sheriff Michael G. Mastronardy; the Tom’s River Police Department, under the direction of Police Chief Mitchell A. Little; the South River Police Department, under the direction of Police Chief Mark Tinitigan; and the Manalapan Township Police Department, under the direction of Police Chief Edward Niesz, with the investigation leading to today’s guilty verdict.
The government is represented by Assistant U.S. Attorneys Jamie L. Hoxie and Jonathan Fayer of the U.S. Attorney’s Office’s Criminal Division in Newark.
Michigan Man Sentenced to Four Years in Prison for Defrauding Business Opportunity Buyers of More Than $5 MillionRead the Press Release
CAMDEN, N.J. – A Michigan man was sentenced today to 48 months in prison for defrauding victims of more than $5 million in connection with the sale of medical-related business opportunities, U.S. Attorney Philip R. Sellinger announced.
Vijay Reddy, 46, of Milan, Michigan, previously pleaded guilty before U.S. District Judge Robert B. Kugler to an information charging him with one count of conspiracy to commit wire fraud and one count of wire fraud.
According to documents filed in this case and statements made in court:
From December 2015 through November 2020, Reddy and his conspirators, David Weinstein and Kevin Brown, advertised business opportunities for sale on various websites. They purported to sell “blocks” of contracts with medical providers who allegedly wanted to outsource their medical billing, collections, appeals, answering, credentialing, or transcription functions. The buyers would then provide the contracted services to the medical providers and earn a profit. The conspirators promised to deliver a specified number of providers and pledged that their proprietary marketing efforts would provide a guaranteed client base to the buyers.
To induce buyers to purchase the business opportunities, the conspirators created fake references purporting to be buyers who vouched for their prior business purchases from the conspirators. In fact, the references were Reddy, Weinstein, and their friends and family members, and they used aliases and disguised phone numbers to speak with potential buyers.
After agreeing to purchase the blocks of medical providers, victims entered contracts with companies represented by Weinstein or Reddy and wired down payments ranging from $15,000 to $240,000 to accounts controlled by Weinstein or Brown. The remainder of each purchase price was payable when the conspirators fulfilled the contract by delivering the agreed-upon number of providers.
After receiving the down payments, Weinstein and Reddy typically delivered to each victim only a small number of medical providers. Despite not fulfilling the contracts of any of the buyers identified by law enforcement, the conspirators continued to sell blocks of medical providers to new buyers and refused to provide refunds for their failures to satisfy the terms of the contracts. The conspirators also periodically sold batches of previously signed contracts and disclaimed further responsibility for those contracts to insulate themselves from complaints or legal action from disgruntled buyers.
Brown acted as the business broker for most of the transactions and received a commission for the sales he brokered. Reddy or Weinstein acted as the seller and signed the contracts with the victims. At least 77 victims sent more than $5 million to accounts controlled by the conspirators. The conspirators spent the victims’ money on personal expenses and business investments.
Weinstein was sentenced in December 2021 to 12 years in prison; Brown pleaded guilty in February 2022 and is scheduled to be sentenced on Sept. 8, 2022.
In addition to the prison term, Judge Kugler sentenced Reddy to three years of supervised release and ordered him to pay restitution of $5.93 million.
U.S. Attorney Sellinger credited special agents of the FBI’s South Jersey Resident Agency, under the direction of Special Agent in Charge Jacqueline Maguire in Philadelphia; special agents of IRS - Criminal Investigation, under the direction of Acting Special Agent in Charge Tammy Tomlins in Newark; and postal inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge Damon Wood in Philadelphia, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorneys Daniel A. Friedman and Diana V. Carrig of the U.S. Attorney’s Office in Camden.
Former Warren County Businessman Admits Fraudulently Obtaining $1.8 Million in COVID-19 Loans Meant for Small BusinessesRead the Press Release
NEWARK, N.J. – A Warren County, New Jersey, businessman today admitted fraudulently obtaining nearly $1.8 million in federal Paycheck Protection Program (PPP) loans, U.S. Attorney Philip R. Sellinger and Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division announced.
Rocco A. Malanga, 50, formerly of Hackettstown, New Jersey, pleaded guilty by videoconference before U.S. District Judge Julien X. Neals to an information charging him with one count of bank fraud and one count of money laundering.
According to documents filed in the case and statements made in court:
From April 2020 through August 2020, Malanga submitted false documentation to three lenders to fraudulently obtain approximately $1.8 million in federal COVID-19 emergency relief funds meant for distressed small businesses. He submitted at least three PPP loan applications on behalf of three different business entities in which he fabricated the number of employees employed by each business entity, as well as their average monthly payroll. Malanga then diverted some of the proceeds from the loans to fund a business that did not receive PPP loan funds.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act is a federal law designed to provide emergency financial assistance to millions of Americans who are suffering the economic effects resulting from the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses through the PPP. In April 2020, Congress authorized over $300 billion in additional PPP funding.
The PPP allowed qualifying small businesses and other organizations to receive loans with a maturity of two years and an interest rate of 1 percent. Businesses must have used PPP loan proceeds for payroll costs, interest on mortgages, rent and utilities. The PPP allowed the interest and principal to be forgiven if businesses spent the proceeds on these expenses within a set time period and used at least a certain percentage of the loan towards payroll expenses.
The bank fraud charge carries a maximum penalty of 30 years in prison and a $1 million fine; the money laundering charge carries a maximum sentence of 10 years and a $250,000 fine. Sentencing is scheduled for Nov. 2, 2022.
U.S. Attorney Sellinger and Assistant Attorney General Polite credited special agents of IRS – Criminal Investigation, under the direction of Acting Special Agent in Charge Tammy L. Tomlins; postal inspectors of the U.S. Postal Inspection Service in Newark, under the direction of Inspector in Charge Damon Wood; special agents of the Office of Inspector General for the Board of Governors of the Federal Reserve System and the Bureau of Consumer Financial Protection, under the Direction of Acting Special Agent in Charge Stephen Donnelly; special agents of the Federal Deposit Insurance Corporation, Office of Inspector General, under the direction of Special Agent in Charge Patricia Tarasca, New York Region; and special agents of the Social Security Administration, Office of the Inspector General, under the direction of Special Agent in Charge Sharon MacDermott, with the investigation leading to the today’s guilty plea.
The government is represented by Assistant U.S. Attorney Blake Coppotelli of the District of New Jersey and Trial Attorney Della Sentilles of the Fraud Section of the Department of Justice.
Camden County Woman Sentenced to Year and a Day in Prison for Witness TamperingRead the Press Release
CAMDEN, N.J. – A Camden County, New Jersey, woman was sentenced today to 12 months and one day in prison for attempting to bribe a witness to steal a gun from a car that was in the custody of the Camden County Police Department, pending the execution of a search warrant, U.S. Attorney Philip R. Sellinger announced.
Saidah A. Davis, aka “Sacha,” 42, of Woodlynne, New Jersey, previously pleaded guilty before U.S. District Judge Noel L. Hillman in Camden federal court to an indictment charging her with witness tampering.
According to documents filed in this case and statements made in court:
Davis admitted that on April 16, 2021, she and codefendant Anthony D. Parker, aka “Papa Smurf,” 38, of Camden, went to the home of an individual who she knew worked at a Camden tow lot that impounded vehicles that were seized by the Camden County Police Department for criminal investigations. Davis, an acquaintance of a relative of the tow lot employee, explained that Parker had a problem, and she asked the employee if he could help Parker. Parker said that his vehicle had been seized by the police pending a search warrant application, and that there was a gun and cash inside the vehicle. Parker offered the tow lot employee $2,000 to break into the vehicle and remove the gun and cash. The tow lot employee refused the bribe, and Davis took the employee’s phone number and said, “we’ll be in touch.”
Parker was convicted of possession of a firearm by a previously convicted felon and is scheduled to be sentenced July 12, 2022.
In addition to the prison term, Judge Kugler sentenced Davis to three years of supervised release.
U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge Jacqueline Maguire in Philadelphia; the Camden County Prosecutor’s Office, under the direction of Acting Prosecutor Grace C. MacAulay; and officers of the Camden County Police Department, under the direction of Chief Gabriel Rodriguez; with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney Kristen M. Harberg of the Criminal Division in Camden.
Camden County Woman Admits Fraudulently Obtaining 30 Loans Meant to Help Small Businesses During COVID-19 PandemicRead the Press Release
CAMDEN, N.J. – A Camden County, New Jersey, resident today admitted conspiring to fraudulently obtain 30 Paycheck Protection Program (PPP) loans and Economic Injury Disaster Loans (EIDL) totaling more than $3 million, and to laundering the proceeds, U.S. Attorney Philip R. Sellinger announced.
Rhonda Thomas, 38, of Sicklerville, New Jersey, pleaded guilty by videoconference before U.S. District Judge Karen M. Williams to an information charging her with one count of bank fraud conspiracy and one count of money laundering.
According to documents filed in this case and statements made in court:
The Coronavirus Aid, Relief, and Economic Security (CARES) Act is a federal law enacted in March 2020 and was designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of hundreds of billions of dollars in forgivable loans to small businesses for job retention and certain other expenses, through the PPP. The CARES Act also authorized the Small Business Administration to provide EIDL of up to $2 million to eligible small businesses that were experiencing substantial financial disruption due to the COVID-19 pandemic.
To obtain a PPP or EIDL loan, a qualifying small business was required to apply and provide information on its operations, including the number of employees and expenses. In addition, businesses generally had to provide supporting documentation.
In 2020 and 2021, Thomas submitted at least 10 PPP application and three EIDL applications for companies she controlled. She represented to the lenders that her companies had employees and payroll expenses that they did not have. In fact, many of her companies were nominal businesses with no employees or payroll expenses.
Thomas also conspired with other purported business owners to submit at least 20 fraudulent PPP and EIDL loan applications. She prepared and submitted these loan applications, which falsely stated the number of employees, payroll, and expenses of the businesses.
Thomas forged tax forms and altered bank statements that she submitted to the lenders as part of the loan applications.
Based on Thomas’s misrepresentations, lenders approved approximately 30 PPP and EIDL loans and disbursed more than $3.1 million in federal COVID-19 emergency relief funds meant for distressed small businesses to Thomas and her conspirators. Thomas personally received more than $330,000 from lenders based on the fraudulent loan applications for her companies and received kickbacks of more than $700,000 from other business owners for her role in preparing and submitting fraudulent loan applications.
Thomas used the fraudulently obtained PPP and EIDL loan proceeds to pay for personal expenses. In March 2022, Thomas withdrew approximately $60,000 of the loan proceeds in cash at a credit union in Camden County.
The charge of bank fraud conspiracy carries a maximum penalty of 30 years in prison and a fine of $1 million. The count of money laundering is punishable by a maximum of 10 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense, whichever is greatest. As part of her guilty plea, Thomas agreed to make restitution in the full amounts of the PPP and EIDL loans. Sentencing is scheduled for Nov. 1, 2022.
U.S. Attorney Sellinger credited special agents of the Federal Deposit Insurance Corporation – Office of the Inspector General, under the direction of Patricia Tarasca, Special Agent-in-Charge, New York Regional Office; special agents of the Social Security Administration, Office of the Inspector General, New York Field Division, under the direction of Special Agent in Charge Sharon MacDermott; special agents of the FBI’s South Jersey Resident Agency, under the direction of Special Agent in Charge Jacqueline Maguire in Philadelphia; special agents of the U.S. Department of Labor, Office of the Inspector General, New York Region, under the direction of Special Agent in Charge Jonathan Mellone, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Daniel A. Friedman of the U.S. Attorney’s Office’s Criminal Division in Camden and Senior Litigation Counsel Jason M. Richardson of the U.S. Attorney’s Office Civil Rights Division in Camden.
Two New York Men Charged for Conspiracy to Distribute 110 Kilograms of CocaineRead the Press Release
NEWARK, N.J. – Two New York men were charged today with conspiring to distribute approximately 110 kilograms of cocaine as part of an international drug trafficking organization, U.S. Attorney Philip R. Sellinger announced.
Eddie Velez-Pena, 33, of Yonkers, New York, and Robin Medina-Fabian, 38, of the Bronx, New York, are charged by complaint with conspiring to distribute and possessing with intent to distribute over five kilograms of cocaine. The defendants are scheduled to appear by videoconference today before U.S. Magistrate Judge Cathy L. Waldor.
According to documents filed in this case and statements made in court:
On or June 25, 2022, law enforcement officers conducted surveillance of a tractor-trailer driven by Velez-Pena and believed to contain narcotics for distribution. They observed the tractor-trailer drive through New Jersey and stop for a period of time in Hampton, New Jersey. Velez-Pena drove through New Jersey to the border of Yonkers and the Bronx, New York, where he met with Medina-Fabian. Velez-Pena transferred multiple duffle bags from his tractor-trailer to Medina-Fabian, who then placed them in the SUV.
Law enforcement officers then conducted a stop of Medina-Fabian’s SUV and observed in plain view several duffel bags matching those provided by Velez-Pena. Subsequent to receiving consent to search the SUV from Medina-Fabian, law enforcement recovered several duffle bags containing approximately 110 kilograms of cocaine and drug ledger sheets.
The count of conspiracy to distribute and possess with intent to distribute over five kilograms of cocaine carries a maximum penalty of life imprisonment, a mandatory minimum term of 10 years in prison and a $10 million fine.
U.S. Attorney Sellinger credited special agents of the Drug Enforcement Administration’s New York Division, under the direction of Special Agent in Charge Frank A. Tarentino III, with the investigation leading to the charges.
This effort is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
The New York OCDETF Strike Force is housed at the DEA’s New York Division and includes agents and officers of the DEA; the New York City Police Department; the New York State Police; Immigration and Customs Enforcement – Homeland Security Investigations; the U. S. Internal Revenue Service Criminal Investigation Division; U.S. Customs and Border Protection; the U.S. Marshals Service; New York National Guard; U.S. Coast Guard; Port Washington Police Department; and New York State Department of Corrections and Community Supervision.
The government is represented by Assistant U.S. Attorney Jenny Chung of the General Crimes Unit in Newark.
The charge and allegations contained in the complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.