District of New Jersey

CAMDEN, N.J. – A Camden man was sentenced today to 141 months in prison for robbing a Camden barbershop at gunpoint, Acting U.S. Attorney Rachael A. Honig announced.

Benjamin Daye, 34, previously pleaded guilty before U.S. District Judge Robert B. Kugler to an information charging him with one count of Hobbs Act robbery and one count of brandishing a firearm during a crime of violence. Judge Kugler imposed the sentence today in Camden federal court.

According to documents filed in this case and statements made in court:

On Nov. 23, 2019, Daye entered a barbershop in Camden armed with a loaded handgun. He grabbed a juvenile customer, pointed the gun at the customer’s head, and demanded cash and belongings from employees and customers. Daye fled and was apprehended shortly thereafter next to a bag containing the handgun and the stolen items.

In addition to the prison term, Judge Kugler sentenced Daye to three years of supervised release and ordered Daye to pay restitution in the amount of $1,672 to the victims of his offenses.

This case is part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local and tribal authorities in investigating and prosecuting gun crimes; improves information sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensured that federal resources are directed at the criminals posing the greatest threat to our communities. For more information about Project Guardian, please see https://www.justice.gov/projectguardian

Acting U.S. Attorney Honig credited special agents of the ATF, under the direction of Acting Special Agent in Charge Craig B. Kailimai; the Camden County Police Department, under the direction of Chief Gabriel Rodriguez; and the Camden County Prosecutor’s Office, under the direction of Acting Prosecutor Jill S. Mayer, with the investigation leading to today’s sentencing. This investigation was a joint efforts of the ATF Camden Field Office and the Camden County Police Department (CCPD) Shooting Response Team (SRT). ATF and CCPD have formulated a partnership composed of special agents, detectives, and intelligence analysts that investigate shooting incidents in real time.

The government is represented by Assistant U.S. Attorney Daniel A. Friedman of the U.S. Attorney’s Office’s Criminal Division in Camden.

CAMDEN, N.J. – A Gloucester County, New Jersey, man was sentenced today to 300 months in prison for producing and distributing images of child sexual abuse, Acting U.S. Attorney Rachael A. Honig announced.

Andrew Nicholas, 24, of Williamstown, New Jersey, previously pleaded guilty before U.S. District Judge Robert B. Kugler to an information charging him with one count of sexually exploiting children and one count of distributing child pornography. Judge Kugler imposed the sentence today in Camden federal court.  

According to documents filed in this case and statements made in court:

On Feb. 26, 2019, an undercover officer entered a public Kik Messenger group and began communicating with Nicholas, who sent the officer images and videos of child sexual abuse involving a prepubescent minor. Nicholas admitted to producing those images and videos of child sexual abuse and sending them to the officer.

In addition to the prison term, Judge Kugler sentenced Nicholas to a lifetime term of supervised release, ordered him to pay restitution of $45,000 to the victims, and ordered him to register as a sex offender.

Acting U.S. Attorney Honig credited special agents of the FBI, Philadelphia Division, under the direction of Special Agent in Charge Michael J. Driscoll, and the Washington, D.C., FBI Field Office, under the direction of Assistant Director in Charge Steven D’Antuono; special agents of the U.S. Department of Homeland Security, Homeland Security Investigations – Cherry Hill, under the direction of Special Agent in Charge Jason J. Molina in Newark, and detectives with the Gloucester County Prosecutor’s Office, under the direction of Acting County Prosecutor Christine Hoffman, with the investigation leading to today’s sentencing.

The government is represented by Assistant U.S. Attorney Martha Nye of the U.S. Attorney’s Office Criminal Division in Trenton.

NEWARK, N.J. – Two Essex County men were arrested today for their roles in a fraudulent debit card scheme, Acting U.S. Attorney Rachael A. Honig announced.

Alateef Perry, 43, of Newark, and Rajohn Dawkins, 25, of Irvington, New Jersey, are charged by complaint with conspiracy to commit access device fraud. Both defendants are scheduled to make initial appearances this afternoon by videoconference before U.S. Magistrate Judge Michael A. Hammer.

According to documents filed in this case and statements made in court:

From July 2019 through March 2020, Perry and Dawkins fraudulently used debit cards in the names of other individuals, without the cardholders’ consent or knowledge, to purchase diesel fuel for commercial truck drivers in exchange for cash. Perry and Dawkins met commercial truck drivers at multiple gas stations in New Jersey, including gas stations located in Hanover and Middlesex. Perry and Dawkins used the unauthorized debit cards to fill the drivers’ commercial trucks with diesel fuel. The truck drivers then typically paid Perry and Dawkins a fraction of the fuel’s purchase price in cash, which Perry and Dawkins pocketed. Perry and Dawkins used over 500 unauthorized debit cards and ultimately stole over $220,000.

The charge of conspiracy to commit access device fraud carries a maximum potential sentence of five years in prison and a maximum potential fine of $250,000, or twice the gross pecuniary gain or loss from the offense, whichever is greater.   

Acting U.S. Attorney Honig credited special agents of the U.S. Secret Service, under the direction of Special Agent in Charge Mark McKevitt, with the investigation leading to today’s arrests. She also thanked inspectors of the U.S. Postal Inspection Service – Newark Division, under the direction of Acting Inspector in Charge Rodney M. Hopkins; the Township of Hanover Police Department, under the direction of Chief Mark D. Roddy, and the Essex County Sheriff’s Office, under the direction of Sheriff Armando B. Fontoura, for their assistance with this investigation. 

The government is represented by Assistant U.S. Attorney Samantha C. Fasanello of the Criminal Division in Newark.

The charges and allegations contained in the complaint are merely accusations and the defendants are presumed innocent unless and until proven guilty.

TRENTON, N.J. – An Ocean County, New Jersey, man was sentenced today to 15 months in prison for possessing cocaine with the intent to distribute, Acting U.S. Attorney Rachael A. Honig announced.

Jason Vella, 39, of Toms River, New Jersey, previously pleaded guilty before U.S. District Judge Anne E. Thompson in Trenton federal court to an information charging him with one count of possession of cocaine with intent to distribute. Judge Thompson imposed the sentence by videoconference today.

On Sept. 19, 2019, investigators from the Ocean County Prosecutors Office executed a search warrant on Vella’s residence and recovered 150 grams of cocaine, drug paraphernalia, $2,295 in cash and pieces of jewelry. 

In addition to the prison term, Judge Thompson sentenced Vella to three years of supervised release.

Acting U.S. Attorney Honig credited the members of the FBI’s Organized Crime Task Force under the direction of Special Agent in Charge George M. Crouch Jr. in Newark; and investigators from the Ocean County Prosecutor’s Office, under the direction of Prosecutor Bradley Billhimer, with the investigation leading to today’s sentencing.

The government is represented by Senior Litigation Counsel V. Grady O=Malley of the U.S. Attorney=s Office’s Organized Crime/Gangs Unit in Newark.

TRENTON, N.J. – A Camden County, New Jersey, woman today admitted receiving hundreds of thousands of dollars of consumer electronics before reselling the stolen goods in connection with a delivery fraud scheme, Acting U.S. Attorney Rachael A. Honig announced.

Yanira Medina-Roman, 36, of West Berlin, New Jersey, pleaded guilty by videoconference before U.S. Senior District Judge Anne E. Thompson to an information charging her with one count of conspiracy to commit wire fraud.

According to documents filed in this case and statements made in court:

From July 2018 through October 2018, Medina-Roman and others carried out a delivery fraud scheme targeting a corporate victim and government agency that resulted in the theft of more than $250,000 of consumer electronics. Medina-Roman and her conspirators used Medina-Roman’s residence – then in Highlands, New Jersey – as the delivery address for the stolen goods. Medina-Roman, under the direction of her conspirators, sold the goods for profit either to a fence of stolen goods, or to third parties through a national classified advertisement website, while retaining for herself a portion of the sale proceeds.

A related cyberattack involved the appropriation without authorization of the identity of an employee of a government agency, which Medina-Roman’s conspirators used by manipulating the employee’s government email address to place orders for consumer electronics and gift cards with a corporate victim located in Maryland. The Maryland corporate victim, believing the emails were authentic and sent by the government employee, with whom the corporate victim had a prior business relationship, was deceived into delivering the consumer electronics to Medina-Roman’s residential address. 

The conspiracy charge to which Medina-Roman pleaded guilty carries a maximum penalty of 20 years in prison and a fine of $250,000, or twice the gross pecuniary gain/loss.  Sentencing is scheduled for Aug. 10, 2021. 

Acting U.S. Attorney Honig credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr.; special agents of the U.S. Secret Service, under the direction of Special Agent In Charge Mark McKevitt; special agents of the Defense Criminal Investigative Service – Cyber Field Office, under the direction of  Special Agent in Charge Kenneth A. DeChellis; inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge Damon Wood in Philadelphia; and officers of the Highlands, New Jersey, Police Department, under the direction of Chief Robert Burton, with the investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorney Eric A. Boden of the U.S. Attorney’s Office’s Criminal Division in Trenton.

CAMDEN, N.J. – An Atlantic County, New Jersey, man was sentenced today to 210 months in prison for his role in distributing images of child sexual abuse, Acting U.S. Attorney Rachael A. Honig announced.

Carlos Santiago-Gomez, 31, of Absecon, New Jersey, previously pleaded guilty before U.S. District Judge Jerome B. Simandle in Camden federal court to one count of distributing images of child pornography. U.S. District Judge Robert B. Kugler imposed the sentence today in Camden federal court.

According to documents filed in this case and statements made in court:

On March 27, 2018, law enforcement officers from the FBI’s Atlantic City Child Exploitation Task Force executed a search warrant at Santiago-Gomez’s residence in Absecon, New Jersey, and seized multiple items of digital evidence, including cell phones, CDs, thumb drives, hard drives and computers, which contained thousands of images of child sexual abuse. Agents also located evidence showing that in July and August 2017, Santiago-Gomez posted videos of child sexual abuse on at least two KIK instant message groups, while also acting as the administrator of one of those groups.

In addition to the prison term, Judge Kugler sentenced Santiago-Gomez to 10 years of supervised release. 

Acting U.S. Attorney Honig credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark; the N.J. State Police, under the direction of Col. Patrick J. Callahan; the Atlantic County Prosecutor’s Office, under the direction of Prosecutor Damon G. Tyner; the Atlantic County Sheriff’s Office, under the direction of Sheriff Eric Scheffler; and N.J. Human Services Police, under the direction of Director Timothy J. Gallagher, with the investigation leading to today’s sentencing.

The government is represented by Assistant U.S. Attorney Diana Carrig of the U.S. Attorney’s Office in Camden.

CAMDEN, N.J. – A California man today admitted his role in a large-scale conspiracy to steal 94,000 credit and debit cards from customers at approximately 80 Michaels’ Stores in 19 states and to then use that information to make fraudulent withdrawals from the bank accounts of those customers, Acting U.S. Attorney Rachael A. Honig announced.

Jose Salazar, aka “Tito,” 44, of Riverside, California, was indicted in 2015 and has been a fugitive. He was apprehended in Mexico City in September 2020 and returned in January 2021 via Philadelphia International Airport, where he was arrested. Salazar pleaded guilty today by videoconference before U.S. District Judge Joseph H. Rodriguez to Count 1 of an indictment charging him with conspiracy to commit bank fraud.

According to documents filed in this case and statements made in court:

The conspirators installed devices that acquired customers’ bank account and personal identification number (PIN) information on point of sale (POS) terminals at stores operated by Michaels. The stolen account information was used to produce counterfeit bank cards, which were used with the stolen PINs to withdraw funds from the compromised bank accounts.

The conspirators allegedly replaced POS terminals in 80 different stores operated by Michaels across 19 states, including New Jersey, with counterfeit POS devices. Each counterfeit device was equipped with wireless technology, which the conspirators used to retrieve the stolen information. From February 2011 to April 2011, conspirators stole approximately 94,000 debit and credit card account numbers.

In 2011, Salazar recruited individuals to participate in the conspiracy. From April 2011 to May 2011, Salazar, Angel Angulo and others obtained counterfeit cards with the corresponding PIN numbers written on them from other conspirators. They used the cards and PIN numbers to withdraw money using automated teller machines (ATMs) from hundreds of bank accounts. Angulo pleaded guilty on June 20, 2017, and was sentenced on March 15, 2018, to three years in prison. 

The charge of conspiracy to commit bank fraud carries a maximum potential penalty of 30 years in prison and a $1 million fine. Sentencing is scheduled for Aug. 10, 2021.

Acting U.S. Attorney Rachael A. Honig credited special agents of the U.S. Secret Service, under the direction of Special Agent in Charge James Henry in Philadelphia, for the investigation leading to today’s guilty plea. She also thanked special agents with the U.S. Marshal Service, under the direction of Juan Mattos, and the International Criminal Police Organization for their assistance.

The government is represented by Assistant U.S. Attorney Jonathan Fayer of the U.S. Attorney’s Office Economic Crimes Unit.

CAMDEN, N.J. – A California man was sentenced today to 48 months in prison for his role in a bank fraud scheme resulting in approximately $1.3 million in losses, Acting U.S.Attorney Rachael Honig announced.

Adam D. Arena, 44, previously pleaded guilty before U.S. District Judge Noel L. Hillman in Camden federal court to an indictment charging him with bank fraud and conspiracy to commit bank fraud. Judge Hillman imposed the sentence by videoconference today.

According to documents filed in this case and statements made in court:

Between 2016 and 2018, Arena conspired with Larry McGee and Dwayne Modeliste to execute a scheme to defraud Synchrony Bank. Arena obtained the personally identifiable information of others, most of whom were incarcerated individuals. Arena and his conspirators then used those individuals’ personal information to obtain credit cards from Synchrony Bank. Arena and his conspirators submitted to Synchrony Bank merchant applications so those enrolled merchants could accept Synchrony credit cards as a form of payment. After Arena and his conspirators enrolled the merchants with Synchrony Bank, they used the fraudulently obtained credit cards to conduct fraudulent transactions at the merchants. The fraudulent proceeds of those transactions were deposited into bank accounts controlled by Arena and his conspirators. 

In addition to the prison term, Judge Hillman sentenced Arena to three years of supervised release. He also ordered Arena to make restitution to Synchrony Bank in the amount of $1.3 million and ordered forfeiture in the amount of $608,282. 

Acting U.S. Attorney Honig credited special agents of FBI, under the direction of Special Agent in Charge George M. Crouch Jr., with the investigation leading to today’s sentencing.

The government is represented by Assistant U.S. Attorney Catherine R. Murphy of the

U.S. Attorney’s Office’s National Security Unit in Newark.

NEWARK, N.J. – A Union County, New Jersey, man pleaded guilty today to possessing images of child sexual abuse, Acting U.S. Attorney Rachael A. Honig announced.

Andrew Chu, 30, of Garwood, New Jersey, pleaded guilty by videoconference before U.S. District Judge William J. Martini to an information charging him with one count of possession of child pornography.

According to documents filed in this case and statements made in court:

In February 2018, Chu downloaded approximately 90 videos depicting the sexual abuse of children from a website on the darknet.

The charge of possession of child pornography carries a maximum potential penalty of 20 years in prison and a $250,000 fine. Sentencing is scheduled for Aug. 26, 2021.

Acting U.S. Attorney Honig credited special agents of the U.S. Department of Homeland Security, Homeland Security Investigations, Newark Field Office, under the direction of Special Agent in Charge Jason J. Molina, with the investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorney Sarah A. Sulkowski of the U.S. Attorney’s Office Cybercrime Unit in Newark.

NEWARK, N.J. – A Monmouth County, New Jersey, man today admitted operating an illegal bitcoin exchange, Acting U.S. Attorney Rachael A. Honig announced.

William Green, 53, of Wall, New Jersey, pleaded guilty by videoconference before U.S. District Judge Kevin McNulty to Count 1 of an indictment charging him with operating an unlicensed money transmitting business.

According to documents filed in this case and statements made in court:

From August 2017 through February 2019, Green operated a website called “Destination Bitcoin.”  Through the website and various referrals, Green received money from members of the public through cash, wire transfers into bank accounts controlled by Green, and online payment processors.  Green then converted the funds to bitcoin and transferred the bitcoin to bitcoin wallet addresses provided by the customers. Green charged the customers a fee for this service.

Federal law provides that any person who owns or controls a money transmitting business shall register the business (whether the business is licensed as a money transmitting business in any state) with the Secretary of the Treasury. Green admitted today that he knew he was required to register his business with the Secretary of the Treasury and that he failed to do so.

The unlicensed money transmitting charge to which Green pleaded guilty carries a maximum potential penalty of five years in prison and a $250,000 fine. Sentencing is scheduled for Aug. 10, 2021.

Acting U.S. Attorney Honig credited special agents of IRS – Criminal Investigation, under the direction of Special Agent in Charge Michael Montanez, 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, with the investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorneys Anthony P. Torntore and Matthew Feldman Nikic of the U.S. Attorney’s Cybercrime Unit in Newark.

NEWARK, N.J. – Acting U.S. Attorney Rachael A. Honig today announced an update on the Office’s enforcement efforts to combat COVID-19 related fraud, including schemes targeting the Paycheck Protection Program (PPP), Economic Injury Disaster Loan (EIDL) program, and Unemployment Insurance (UI) programs, and schemes involving the price-gouging and hoarding of critical personal protective equipment

In the past year, the U.S. Attorney’s Office for the District of New Jersey has charged 18 defendants, including individuals and companies, with offenses based on fraud schemes, price-gouging, hoarding, and other crimes connected to the COVID-19 pandemic.

“Exploitation of the global pandemic for illicit financial gain victimizes consumers, taxpayers, and federal programs alike,” Acting U.S. Attorney Honig said. “We are working with our law enforcement partners to investigate these schemes and bring to justice all those who would try to take advantage of the programs established by Congress to help America through the pandemic. We will vigorously pursue anyone trying to steal from those programs, engage in the hoarding or price-gouging of necessary personal protective equipment, or otherwise defraud the public.”

Most recently, three defendants were charged last month in connection with an EIDL scheme: George Leguen, 46, of Paramus, New Jersey, and Shyteek Stevenson, 30, of Harrisburg, Pennsylvania, were charged in separate complaints with one count each of wire fraud and money laundering. Marc Orival, 37, of College Park, Georgia, is charged in a third complaint with two counts each of wire fraud and money laundering.

Congress passed a $2.2 trillion economic relief bill known as the Coronavirus Aid, Relief, and Economic Security (CARES) Act in March 2020. The Act is designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. Anticipating the need to protect the integrity of these taxpayer funds and to otherwise protect Americans from fraud related to the COVID-19 pandemic, the Department of Justice immediately stood up multiple efforts dedicated to identifying, investigating, and prosecuting such fraud. The U.S. Attorney’s Office for the District of New Jersey continues to lead the Department of Justice’s Hoarding and Price-Gouging Task Force.

 Other cases charged in New Jersey include:

 

Date of Charge

Lead Defendant

3/30/2020

Baruch Feldheim

3/30/2020

Erik Santos

6/5/2020

King Year Packaging and Printing

6/17/2020

Crawford Technology Group

8/14/2020

CSG Imports LLC and KG Imports LLC

9/3/2020

Jae Choi

9/17/2020

Jeffrey Bennett

9/29/2020

Dang Chanchai

10/21/2020

Jefferson Robert

10/23/2020

Justin Ezeiruaku

11/19/2020

Rocco Malanga

12/14/2020

Azhar Rana

12/16/2020

Maurice Mills

1/20/2021

Gauravjit Singh

3/18/2021

John Jhong

 

To learn more about the department’s COVID response, visit: https://www.justice.gov/coronavirus. For further information on the Criminal Division’s enforcement efforts on PPP fraud, including court documents from significant cases, visit the following website: https://www.justice.gov/criminal-fraud/ppp-fraud. For further information on the Civil Division’s enforcement efforts, visit the following website: https://www.justice.gov/civil.

To report a COVID-19-related fraud scheme or suspicious activity, contact the National Center for Disaster Fraud (NCDF) by calling the NCDF Hotline at 1-866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

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TRENTON, N.J. –A Trenton man was charged today with assaulting a federal agent with a deadly weapon, armed robbery, and discharging a firearm during and in relation to a crime of violence, Acting U.S. Attorney Rachael A. Honig announced.

Jabree Johnson, 28, of Trenton, is charged by complaint with one count of assault on a federal officer with a deadly weapon, one count of robbery with a dangerous weapon of an individual with custody of federal property, and one count of using and carrying a firearm during and in relation to a crime of violence, in which the firearm was discharged. Johnson is currently in custody on related charges filed by the Mercer County Prosecutor’s Office in connection with the assault. He will make his initial appearance by videoconference before U.S. Magistrate Judge Zahid N. Quraishi on a date to be determined.

According to documents filed in this case and statements made in court:

On March 22, 2021, federal law enforcement officers were investigating firearms trafficking and other illegal activities in Trenton and Hamilton, New Jersey. An undercover federal law enforcement agent arranged to purchase multiple firearms from an individual later identified as Johnson. 

After arriving at an agreed-upon location for the firearms transaction, Johnson entered the undercover federal agent’s vehicle and handed the agent a black, semi-automatic firearm. The undercover federal agent inspected the firearm and then returned it to Johnson, and requested to see the other firearms that Johnson had agreed to sell. Instead, Johnson pointed the loaded firearm directly at the undercover federal agent and demanded money from the agent. In response, the undercover federal agent provided Johnson with an amount of U.S. currency. Johnson then ordered the undercover federal agent out of the vehicle at gunpoint. The agent exited the vehicle as ordered, drew a service-issued firearm, and fired at Johnson, striking Johnson in the shoulder. Johnson fired his handgun multiple times at the undercover federal agent before fleeing the area. Johnson was later identified at a local hospital as the individual who had assaulted and robbed the undercover federal agent at gunpoint.    

The charge of assault on a federal officer with a deadly weapon carries a maximum potential penalty of 20 years in prison and a $250,000 fine. The charge of robbery of federal property with a dangerous weapon carries a maximum potential penalty of 25 years in prison and a $250,000 fine. The charge of using and carrying a firearm during and in relation to a crime of violence carries a statutory mandatory minimum sentence of 10 years in prison, which must run consecutive to any other sentence imposed, and a maximum of life in prison.

Acting U.S. Attorney Honig credited special agents of the FBI, Newark Field Office, under the direction of Special Agent in Charge­­­­ George M. Crouch Jr.; special agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives, Newark Field Division, Trenton Field Office, under the direction of Special Agent in Charge Charlie J. Patterson; officers of the Trenton Police Department, under the direction of Police Director Sheilah Coley; officers of the Hamilton Township Police Department, under the direction of Police Chief James Stevens; troopers of the New Jersey State Police, under the direction of Col. Patrick J. Callahan, and detectives and prosecutors of the Mercer County Prosecutor’s Office, under the direction of Prosecutor Angelo Onofri, with the investigation leading to today’s charges.

The government is represented by Assistant U.S. Attorney Eric A. Boden and Special Assistant U.S. Attorney Katie Magee Lee of the U.S. Attorney’s Office’s Criminal Division in Trenton.

The charges and allegations in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty. 

NEWARK, N.J. – A New York man is scheduled to make his initial appearance today on charges that he attempted to engage in sex trafficking of two minors and transported the minors to engage in unlawful sexual activity, Acting U.S. Attorney Rachael A. Honig announced.

Berry Norman, 32, is charged in a three-count complaint with attempted sex trafficking of two minors and transporting the minors to engage in unlawful sexual activity. He is scheduled to appear by videoconference before U.S. Magistrate Judge Cathy L. Waldor this afternoon.

According to documents filed in this case and statements made in court:

On Feb. 24, 2021, Norman enticed the victims, both minors, to travel with him from Ohio to New Jersey. On Feb. 25, 2021, Norman housed the victims in a hotel in Hudson County, New Jersey. Norman allegedly attempted to convince the victims to engage in commercial sex acts.  Norman told the victims that they could “get paid” for having sex with men and for performing sexually explicit “shows” on the computer. The victims declined. On Feb. 27, 2021, Norman engaged in sex acts with one victim. 

On Feb. 28, 2021, Norman transported the victims to another hotel in New York. Norman purchased lingerie for the victims. When they returned to the hotel room, Norman allegedly encouraged the victims to put on the lingerie and perform sexual acts while a computer live-streamed the victims over the Internet. The victims declined again. Later that evening, one victim observed a laptop that was on and streaming a video of the victims in the hotel room. The victim contacted a relative for help. In turn, the victim’s relative contacted law enforcement, leading to Norman’s arrest.

Each count of attempting to engage in sex trafficking with a minor and transportation of a minor to engage in unlawful sexual activity carries a statutory mandatory minimum penalty of 10 years in prison and a maximum of life in prison.

Acting U.S. Attorney Honig credited special agents of the U.S. Department of Homeland Security, Homeland Security Investigations, under the direction of Special Agent in Charge Jason J. Molina; members of the New York City Police Department, under the direction of Chief Terence A. Monahan; and members of the Hudson County Prosecutor’s Office, under the direction of Prosecutor Esther Suarez, with the investigation leading to the charges.

The government is represented by Assistant U.S. Attorney Kimberly Mitchell of the OCDETF/Narcotics Unit in Newark.

NEWARK, N.J. – Acting U.S. Attorney Rachael A. Honig and FBI Newark Field Division Special Agent in Charge George M. Crouch Jr., today reiterated federal law enforcement’s commitment to investigating and prosecuting all acts of bias-motivated violence and other deprivations of individuals’ civil rights, including crimes committed on the basis of race, ethnicity, religion, sex, national origin, disability, sexual orientation, or gender identity. 

“Some of the darkest hours that we have lived through recently as New Jersey residents have involved the horror of violence based on hate,” Acting U.S. Attorney Honig said. “We have seen anti-Semitic violence in Jersey City and a gender- and race-based attack at the home of a federal judge. Now, we face a rising tide of hatred directed at Asian-Americans.  New Jersey is one of the most diverse states in the country, and this kind of hate should find no home here. We urge the community to report hate-based crimes to the FBI and to contact our office’s civil rights hotline with information about discrimination in housing, employment, education, or public accommodations.”

“Hate crimes are not only an attack on an individual, but an entire community,” FBI Special Agent in Charge Crouch said. “Investigating these crimes is one of the FBI’s highest priorities. We will work diligently with our law enforcement partners to protect the rights of all Americans.”

The U.S. Attorney’s Office for the District of New Jersey employs four Assistant U.S. Attorneys dedicated full-time to federal civil rights enforcement: three in the Civil Rights Unit of the Civil Division, and one Senior Civil Rights Counsel in the Criminal Division. The Office works closely in these matters with the Civil Rights Division of the Department of Justice. In the past several years, the Office has brought multiple civil and criminal cases based on federal civil rights laws and has been recognized by the Executive Office of U.S. Attorneys with two Director’s Awards for its work in this area. These Assistant U.S. Attorneys also conduct frequent community outreach, including outreach focused on organizations serving women, people of color, religious groups, and the LBGTQ+ community. 

Acting U.S. Attorney Honig and Special Agent in Charge Crouch urged all New Jersey residents to report hate-based crimes to law enforcement. Members of the public who have a civil rights concern or complaint should contact the U.S. Attorney’s Office through its civil rights hotline, which can be reached at 855-281-3339, or by filling out the following form on the Office’s website:  /media/1184596/dl?inline. The FBI’s Newark Field office can be reached at (973) 792-3000.

The most recent statistics maintained by the FBI on hate crimes are available here:  https://ucr.fbi.gov/hate-crime/2019/hate-crime. Additional resources regarding hate crimes and bias incidents can be found by visiting these links: https://civilrights.justice.gov/#your-rights and https://fbi.gov/investigate/civil-rights/hate-crimes#FBI-Resources.

For additional information about the U.S. Attorney’s Office in the District of New Jersey visit: www.justice.gov/usao-nj/.

TRENTON, N.J. – A Middlesex County, New Jersey, man today admitted attempting to interfere with law enforcement officers during a civil disorder when he attempted to set fire to a police vehicle during a riot in Trenton, Acting U.S. Attorney Rachael A. Honig announced.

Justin D. Spry, 22, of South Plainfield, New Jersey, pleaded guilty by videoconference before U.S. District Judge Brian R. Martinotti to an information charging him with one count of attempting to obstruct, impede, or interfere with law enforcement officers during a civil disorder affecting commerce.

According to documents filed in this case and statements made in court:

On May 31, 2020, large-scale protests were held throughout the United States, including in Trenton, in response to the death of George Floyd. Although the May 31st protest in Trenton was peaceful earlier in the day, violence erupted later. A group of individuals proceeded down East State Street in downtown Trenton and began to riot, smashing store fronts, looting stores, and attacking multiple marked Trenton Police Department vehicles parked on the 100 Block of East State Street.

A City of Trenton street camera and other video footage taken by an individual present on the street captured Kadeem Dockery light an explosive device and throw it through the open front driver’s side window of a Trenton Police Department vehicle. Dockery then removed his shirt and handed it to Killian Melecio, who then attempted to stuff the shirt in the gas tank of the police vehicle and ignite it. Melecio was then assisted by Spry in attempting to set fire to the police vehicle. Law enforcement officers on scene arrested Spry, but Melecio and Dockery fled. Law enforcement later identified Melecio and Dockery through analysis of street camera and other video footage. They were arrested on Aug. 5, 2020.

Melecio pleaded guilty on Jan. 26, 2021, to one count of attempting to obstruct, impede, or interfere with law enforcement officers during a civil disorder affecting commerce.

The charge of attempting to interfere with law enforcement officers during a civil disorder to which Spry and Melecio have pleaded guilty carries a maximum penalty of five years in prison and a maximum fine of $250,000. Sentencing for Spry is scheduled for Aug. 3, 2021.

Acting U.S. Attorney Honig credited special agents of the FBI and task force officers of the Joint Terrorism Task Force in Newark, under the direction of Special Agent in Charge George M. Crouch Jr., with the investigation leading to today’s guilty plea. She also thanked officers of the Trenton Police Department, under the direction of Police Director Sheilah Coley; troopers of the New Jersey State Police, under the direction of Col. Patrick J. Callahan; and officers of the New Jersey Department of Corrections, under the direction of Commissioner Marcus O. Hicks, for their assistance.

The government is represented by Assistant U.S. Attorneys Alexander E. Ramey and Michelle S. Gasparian of the U.S. Attorney’s Office’s Criminal Division in Trenton.

The charges and allegations remaining against Kadeem Dockery are merely accusations, and he is presumed innocent unless and until proven guilty.

TRENTON, N.J. – A former Princeton resident was arrested today and charged with engaging in multiple fraudulent schemes intended to steal millions of dollars from individual and institutional victims, Acting U.S. Attorney Rachael A. Honig announced.

Ford Graham, 57, formerly of Princeton, New Jersey, was arrested today in Nellysford, Virginia, and charged by criminal complaint with two counts of wire fraud, one count of conspiracy to commit wire fraud, one count of securities fraud, three counts of aggravated identity theft, and one count of engaging in unlawful money transactions. Graham made his initial appearance before U.S. Magistrate Judge Joel Hoppe in Harrisonburg, Virginia, federal court. Graham will make his initial appearance in U.S. District Court for the District of New Jersey on a date to be determined.

According to documents filed in this case and statements made in court:

From December 2012 to September 2013, Graham represented himself as the owner, chief executive, chairman, manager, and principal member of dozens of corporate entities purporting to do business under an umbrella organization, Vulcan Capital Corp. (Vulcan). Graham held himself out as a highly successful financier who had vast experience sponsoring complex energy and natural resource projects and other investment deals. In connection with one such investment that Graham and a Vulcan entity sponsored, one victim (Victim-1) invested more than $2 million with Graham, relying on Graham’s misrepresentations and omissions regarding the investment. The investigation revealed that Graham misappropriated substantial amounts of Victim-1’s investment money and used it for his own personal benefit and enrichment – including international vacations, private school tuition for his children, and other personal amenities – instead of the investment purpose that Graham had marketed. Graham caused multiple victims to lose more than $2.6 million.

Graham also participated in a scheme to defraud merchant processing institutions through fraudulent credit card transactions. From December 2017 to February 2018, Graham used at least one payment processing platform to process fraudulent charges on stolen credit card numbers that he obtained. After the payment processing platform credited Graham’s account with the payments requested, Graham quickly transferred or caused to be transferred the fraudulently obtained money to other accounts before the victim institutions could act. When requested by the victim payment processing company to provide supporting documentation, Graham submitted false documentation, including fabricated invoices and credit card authorization forms, fabricated e-mails, forged signatures, altered bank statements, and other false and fraudulent information. This scheme resulted in tens of thousands of dollars of losses and the misappropriation of multiple victims’ personal identification information.

From February 2017 to June 2018, Graham conspired with others to defraud victim institutions and individuals of millions of dollars through a business email compromise scheme. Members of the conspiracy sent fraudulent e-mail communications to victims who were scheduled to make substantial outgoing wire transfers to third parties. These fraudulent e-mails created the appearance that they had been sent by the intended third-party recipients of the scheduled payments when, in fact, they were sent by members of the conspiracy. The fraudulent emails requested the victims to reroute the scheduled payments to different bank accounts, which Graham and his conspirators controlled. In one instance, a fraudulent email successfully induced one victim unknowingly to reroute a payment of more than $650,000 to a bank account that Graham controlled. Upon receiving the funds, Graham transferred or caused to be transferred substantial portions of those funds to other accounts that he controlled, and which he used and intended to use for his own personal benefit. Graham and his conspirators attempted to defraud multiple victims of at least $6 million.

The wire fraud and wire fraud conspiracy counts each carry a maximum potential penalty of 20 years in prison and a fine of $250,000, or twice the gross amount of gain or loss from the offense, whichever is greater. The securities fraud count is punishable by a maximum potential penalty of 20 years in prison and a $5 million fine. Each count of aggravated identity theft is punishable by a statutory mandatory consecutive sentence of two years, which must run consecutive to any other sentence. The charge of engaging in unlawful monetary transactions carries a maximum potential penalty of 10 years in prison and a fine of $250,000 or twice the gross gain or loss from the offense or not more than twice the amount of the criminally derived property involved in the transactions.

Acting U.S. Attorney Honig credited special agents of the FBI, Newark Division, Red Bank Resident Agency, under the direction of Special Agent in Charge George M. Crouch Jr.; special agents of IRS - Criminal Investigation, under the direction of Special Agent in Charge Michael Montanez; and inspectors of the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Rodney M. Hopkins, with the investigation leading to today’s charges. Acting U.S. Attorney Honig also thanked investigators with the New Jersey Bureau of Securities, under the direction of Chief Christopher W. Gerold, for their assistance in connection with the investigation.

The government is represented by Assistant U.S. Attorneys J. Brendan Day, Attorney-in-Charge of the Trenton Branch Office, and Martha K. Nye, of the Criminal Division in Trenton.

NEWARK, N.J. – A Pennsylvania man today admitted his role in a conspiracy to receive kickbacks and bribes from laboratories in exchange for referrals of patient DNA samples and genetic tests, Acting U.S. Attorney Rachael A. Honig announced.

Jeremy Richey, 40, of Mars, Pennsylvania, pleaded guilty by videoconference before U.S. District Judge Brian R. Martinotti to a superseding information charging him with conspiracy to commit an offense against the United States in connection with a scheme to violate the Anti-Kickback Statute. Richey and five co-defendants were previously charged by indictment in September 2019 in connection with the conspiracy and a related health care fraud scheme.

According to documents filed in this case and statements made in court:

Richey and certain conspirators operated Ark Laboratory Network LLC (Ark), a company that purported to operate a network of laboratories that facilitated genetic testing. Through Ark, Richey and others submitted or caused to be submitted referrals for genetic tests and patients’ DNA samples to various clinical laboratories across the country. Richey and certain conspirators entered into kickback agreements with certain clinical laboratories under which the laboratories paid Ark bribes in exchange for delivering DNA samples and orders for genetic tests. Ark concealed these kickback arrangements through issuing sham invoices to laboratories that purportedly reflected services provided at an hourly rate even though the parties had already agreed upon the bribe amount, which was based on the revenue the laboratories received from Medicare or an amount paid for each DNA sample. From January 2018 through January 2019, Medicare paid these laboratories at least approximately $4.6 million for genetic tests that resulted from the referrals and DNA samples that Ark delivered to the laboratories in exchange for bribes. In turn, the laboratories paid Ark at least $1.8 million in bribes.

The charge to which Richey pleaded guilty carries a maximum penalty of five years in prison and a fine of $250,000, or twice the gross grain or loss from the offense. Richey’s sentencing is scheduled for Aug. 9, 2021.

Co-defendants Kacey C. Plaisance, of Altamonte Springs, Florida; Kyle D. McLean, of Arlington Heights, Illinois; and Edward B. Kostishion, of Lakeland, Florida, previously pleaded guilty. Plaisance is scheduled to be sentenced on June 21, 2021. McLean is scheduled to be sentenced on July 26, 2021. Kostishion is scheduled to be sentenced on July 26, 2021.

Acting U.S. Attorney Honig credited special agents of the U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert; and special agents of the U.S. Attorney’s Office for the District of New Jersey, under the direction of Supervisory Special Agent Thomas J. Mahoney, with the investigation leading to today’s guilty plea.

The government is represented by Bernard J. Cooney, Chief of the Government Fraud Unit, and Assistant U.S. Attorney José R. Almonte of the Health Care Fraud Unit in Newark.

The charge and allegations against the remaining defendants are merely accusations, and they are presumed innocent unless and until proven guilty.

NEWARK, N.J. – A New York man was sentenced today to 33 months in prison for participating in a scheme to buy and sell over $2 million in stolen property, Acting U.S. Attorney Rachael A. Honig announced.

James Olla, 29, of Brooklyn, New York, previously pleaded guilty by videoconference before U.S. District Judge John Michael Vazquez to a superseding indictment charging him with conspiracy to sell, receive or possess stolen goods. Judge Vazquez sentenced Olla today by videoconference.

According to documents filed in this case and statements made in court:

From January 2014 through June 2015, Olla and others procured stolen information related to credit cards belonging to various individuals, including victims living in New Jersey. Using this stolen information, Olla and his conspirators obtained gift cards from various retailers and then sold the cards on the streets of Brooklyn and elsewhere, often for large sums of cash. In total, Olla’s scheme resulted in losses to financial institutions of $2,041,977.

In addition to the prison term, Judge Vazquez sentenced Olla to three years of supervised release, ordered him to forfeit certain property, and pay restitution of $689,124.

Acting U.S. Attorney Honig credited special agents of FBI, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark; the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Rodney M. Hopkins in Newark; and the U.S. Secret Service, under the direction of  Special Agent in Charge Mark McKevitt, with the investigation leading to today’s sentencing.

The government is represented by Cybercrime Unit Chief David W. Feder and Assistant U.S. Attorney Joshua L. Haber of the U.S. Attorney’s Office Criminal Division in Newark.

NEWARK, N.J. – A second man from California has been charged with conspiring to launder money that originated from fraudulently obtained loans from the U.S. Small Business Association and from a business email compromise scheme that targeted a law firm based in New Jersey, Acting U.S. Attorney Rachael A. Honig announced.

Anthony Debose Hannah, 57, of Moreno Valley, California, is charged by complaint with one count of money laundering conspiracy. Hannah was taken into custody this morning in California and is scheduled to appear by videoconference today before U.S. Magistrate Judge Shashi H. Kewalramani in Riverside, California, federal court.

According to documents filed in this case and statements made in court:

In June 2020, Victim 1 communicated via email with a law firm in New Jersey that was helping Victim 1, a resident of Bergen County, New Jersey, with a real estate transaction. One of the law firm’s email accounts was compromised and someone purporting to be emailing on behalf of the law firm sent instructions to Victim 1 to wire approximately $560,000 into an escrow account under the name “Eric’s Commercial LLC.” Victim 1 wired approximately $560,000 into a business bank account controlled by Eric Bullard, Hannah’s conspirator. Victim 1 did not intend for the money to be transferred to Bullard and sent the wire transfer to Bullard’s account under the belief that the wire instructions had come from the New Jersey law firm.

Shortly after the $560,000 was transferred into the Eric’s Commercial LLC bank account, approximately 10 cash withdrawals were made from the account totaling $96,275. On June 14, 2020, three large wire transfers totaling approximately $460,000 were made from the Eric's Commercial Bank Account to other bank accounts. One of those transfers was a wire transfer of approximately $230,000 to an account in the name of “Anthony Property Management & Development,” an account controlled by Hannah.  Hannah opened the Anthony Property Management account on May 18, 2020, and was the sole signatory on the account.

On June 15, 2020, approximately $230,000 was transferred from the Anthony Property Management account to another business account that does not appear to be controlled by Hannah or Bullard.

In addition to laundering of the proceeds from the business email compromise, Bullard and Hannah also obtained and laundered funds from the U.S. Small Business Administration’s (SBA) Economic Injury Disaster Loan (EIDL) program. In July 2020, Hannah received into a business bank account that he controlled $145,400 from an SBA EIDL loan intended for a pharmacy company with a listed location in Idaho, some of which he shared with Bullard.  Bullard also received a $143,100 SBA EIDL loan intended for a pharmacy company with a listed location in Colorado. A few days later, Bullard wrote a check to Hannah for $51,000. In addition to the SBA loan money, Hannah also received payments from the Illinois Department of Employment Security. 

Bullard was arrested on similar charges last week in California and was ordered detained; he is pending transfer to the District of New Jersey.

The count of money laundering conspiracy carries a maximum penalty of 20 years in prison and a fine of up to $500,000 or twice the value of the monetary instrument or funds involved in the transfer, whichever is greater.

Acting U.S. Attorney Honig credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark, with the investigation leading to the charges.

The government is represented by Assistant U.S. Attorney Jamie L. Hoxie of the Cybercrime Unit in Newark.

The charges and allegations in the complaints are merely accusations, and the defendants are presumed innocent unless and until proven guilty.   

NEWARK, N.J. – An Essex County, New Jersey, man previously convicted of multiple felonies was sentenced today to 36 months in prison for possessing a firearm and ammunition, Acting U.S. Attorney Rachael A. Honig announced.

Sharif Clarke, 39, of Irvington, New Jersey, previously pleaded guilty before U.S. District Judge Brian R. Martinotti to count one of an indictment charging him with being a felon in possession of a weapon. Judge Martinotti imposed the sentence today by videoconference.

According to documents filed in this case and statements made in court:

On Dec. 3, 2018, Clarke possessed a Glock .40-caliber handgun loaded with nine rounds of Remington ammunition. At that time, Clarke had previously been convicted in Essex County Superior Court of resisting and eluding arrest and of possession of a controlled substance on school property, both of which are felonies.

This case is part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local and tribal authorities in investigating and prosecuting gun crimes; improves information sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities. For more information about Project Guardian, please see https://www.justice.gov/projectguardian.

In addition to the prison term, Judge Martinotti also sentenced Clarke to three years of supervised release.

Acting U.S. Attorney Honig credited special agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives, Newark Field Division, under the leadership of Special Agent in Charge Charlie J. Patterson, and the Newark Department of Public Safety, under the leadership of Public Safety Director Anthony F. Ambrose, with the investigation leading to today’s sentencing.

The government is represented by Assistant U.S. Attorney Sarah A. Sulkowski of the U.S. Attorney’s Cybercrime Division in Newark.

CAMDEN, N.J. – A Virginia man was arrested and charged with gun trafficking and possession of firearms by a felon, Acting U.S. Attorney Rachael A. Honig announced today.

Markell Pooler, 26, of Norfolk, Virginia, is charged by complaint with one count of dealing in firearms and two counts of possession of firearms by a convicted felon. He appeared by videoconference this afternoon before U.S. Magistrate Judge Ann Marie Donio and was detained without bail.

According to documents filed in this case and statements made in court:

Pooler was identified as a firearms trafficker who offered to bring guns from pawn shops in Virginia to the Camden area. Between December 2020 and his arrest, Pooler, a convicted felon, obtained handguns in Virginia and sold them in South Jersey. Pooler had in his possession five handguns when he was arrested.

The count of engaging in the business of unlicensed firearms dealing and travelling across state lines to do so carries a maximum potential penalty of 15 years in prison and a $250,000 fine. The counts of possession of a firearm by a felon each carry a maximum potential penalty of 10 years in prison and a $250,000.

Acting U.S. Attorney Honig credited special agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives, Camden Field Office, under the direction of Special Agent in Charge of Charlie J. Patterson in Newark; the New Jersey State Police, under the direction of Col. Patrick J. Callahan; the Gloucester County Prosecutor’s Office, under the direction of Acting County Prosecutor Christine Hoffman; and the Woodbury Police Department, under the direction of Chief Thomas R. Ryan, with the investigation leading to the charges.

This case is part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local and tribal authorities in investigating and prosecuting gun crimes; improves information sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensured that federal resources are directed at the criminals posing the greatest threat to our communities. For more information about Project Guardian, please see: https://www.justice.gov/projectguardian

The government is represented by Assistant U.S. Attorney Alisa Shver of the U.S. Attorney’s Office Criminal Division in Camden.

The charges and allegations contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

NEWARK, N.J. – Nine Newark residents were charged for their roles in conspiracies to distribute and possess with intent to distribute narcotics, Acting U.S. Attorney Rachael A. Honig announced today.

Robert Covington, aka “Nachie,” 55; Korey Smith, aka “Murda,” 36: Jeffrey Workman, aka “Rah,” 53; Yvonne Jackson, 49; Carlos Stokes, aka “Ab,” 54; Karen Gamble, 50; and Alaa Covington, 21, are charged by criminal complaint with conspiracy to distribute and possess with intent to distribute at least 40 grams of fentanyl. Robert Covington, Workman, Williamson, Stokes, and Gamble are also charged with conspiracy to distribute and possess with intent to distribute cocaine. Smith is additionally charged, along with Leroy Baxter III, 55, and William Lane, 57, with conspiracy to distribute and possess with intent to distribute heroin. Eight of the defendants are expected to appear this afternoon by videoconference before U.S. Magistrate Judge Cathy L. Waldor. Stokes remains at large.

According to the documents filed in this case and statements made in court:

From August 2020 through March 2021, multiple individuals were involved in selling fentanyl and cocaine in an open-air narcotics market in Bradley Court Housing Complex in Newark. These individuals comprise at least two separate drug-trafficking organizations (DTOs), which have overlapping membership.

DTO-1 involved individuals engaged in the distribution of fentanyl and included Robert Covington, Smith, Williamson, Gamble, Workman, Stokes, and Alla Covington. DTO-2 involved individuals engaged in the distribution of cocaine and included Robert Covington, Williamson, Gamble, Workman, and Stokes.  

The investigation revealed that Robert Covington was one of the leaders and organizers of DTO-1’s and DTO-2’s distribution of fentanyl and cocaine in or around Bradley Court.  Covington purchased powder cocaine and fentanyl from various sources, including Smith; “cooked” powder cocaine into crack cocaine or directed others to do so; used various “stash houses” to store and distribute fentanyl and cocaine and to store narcotics proceeds; and employed multiple drug dealers, including Workman, Williamson, Stokes, and Alaa Covington, among others, to distribute fentanyl and cocaine to the area surrounding Bradley Court. 

Smith – the fentanyl supplier for DTO-1 – was also engaged in distributing heroin in and around his residence on Fairmount Avenue in Newark from at least January 2021 to the present, along with Baxter, Lane, and others. 

The conspiracy to distribute and possess with intent to distribute fentanyl charge carries a mandatory minimum sentence of five years in prison, a maximum sentence of 40 years in prison, and a $5 million fine. The heroin and cocaine conspiracy charges each have a maximum sentence of 20 years in prison and a $1 million fine.

Acting U.S. Attorney Honig credited special agents of the FBI, under the direction of Acting Special Agent in Charge George M. Crouch Jr. in Newark, with the investigation leading to the charges. She also thanked the Newark Police Department, the Essex County Sheriff's Office and the Bloomfield Police Department for their assistance in the investigation.

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, and the Irvington Police Department.

The government is represented by Assistant U.S. Attorney Emma Spiro of the United States Attorney’s Office, Opioid Abuse Prevention and Enforcement Unit in Newark.

The charges and allegations in the complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

TRENTON, N.J. – A Monmouth County, New Jersey, woman today admitted that she underreported income on her personal tax return, Acting U.S. Attorney Rachael A. Honig announced.

Kathy Manna, 58, of Atlantic Highlands, New Jersey, and formerly of Lavallette, New Jersey, pleaded guilty by videoconference before U.S. District Judge Michael A. Shipp to an information charging her with one count of making and subscribing a false tax return.

According to documents filed in the case and statements made in court:

Manna operated Manna Construction Group, a business headquartered in Lavallette, that provided landscaping and construction services in New Jersey and elsewhere. She admitted that for tax years 2010, 2011, 2012, and 2013, she underreported the gross receipts or sales of Manna Construction Group on Schedule C of her personal tax return. Under the terms of her plea agreement, the government alleges that the total tax loss was $124,480.

The count of making and subscribing a false tax return carries a maximum potential penalty of three years in prison and $250,000 fine, or twice the gross gain or loss from the offense. Sentencing is scheduled for July 28, 2021.

Acting U.S. Attorney Honig credited special agents of the IRS, under the direction of Special Agent in Charge Michael Montanez, with the investigation leading to today’s guilty plea.   She also thanked the Ocean County Prosecutor’s Office, under the direction of Prosecutor Bradley D. Billhimer, and the Lavallette Police Department, under the direction of Chief Colin M. Grant.

The government is represented by Assistant U.S. Attorney Jennifer Kozar of the U.S. Attorney’s Office Economic Crimes Unit.

NEWARK, N.J. –  Two members of the Newark street gang known as the “Famous Boyz” were sentenced to prison for conspiring to distribute crack cocaine and heroin, Acting U.S. Attorney Rachael A. Honig announced today.  

Malik Minor, aka “YK,” 23, of Newark, was sentenced today to 63 months in prison and five years of supervised release; Javon Holmes, aka “J-Dot,” 21, of Newark, was sentenced March 22, 2021, to 108 months in prison and four years of supervised release. Minor previously pleaded guilty before U.S. District Judge Madeline Cox Arleo to an information charging him with one count of conspiring to distribute 28 grams or more of crack cocaine, and 100 grams or more of heroin. Holmes previously pleaded guilty to a superseding information charging him with one count of conspiring to distribute 28 grams or more of crack cocaine, and 100 grams or more of heroin, and possessing with the intent to distribute 28 grams or more of crack cocaine. Judge Arleo imposed both sentences by videoconference.       

According to the documents filed in this case and statements made in court:

The Famous Boyz are a subset of the Brick City Brim set of the Bloods street gang, which dealt significant quantities of heroin and crack cocaine, primarily in and around the area of South 18th Street and 15th Avenue, in Newark. The gang often referred to this area as the “8 Block,” “18th,” or simply by reference to the number “8.”

In October 2018, Minor, Holmes, and 15 other members of a violent drug trafficking conspiracy operating in Newark were charged by complaint with conspiracy to distribute crack cocaine and/or heroin following a lengthy wiretap investigation. Shaka McKinney and Jahid Vauters, aka “K,” aka “KO,” also were charged with firearms possession offenses. To date, 15 of the defendants have pleaded guilty to drug and firearm charges and three await sentencing. 

On Feb. 25, 2019, a grand jury returned an indictment charging three of the defendants, Patricio Hernandez, Jonathan Hernandez, and Jonathan Garcia, aka “Bebo” with one count each of conspiracy to distribute and to possess with intent to distribute 280 grams or more of crack cocaine for their alleged participation in supplying the “Famous Boyz” with cocaine. On Sept. 30, 2019, a grand jury returned a 21-count superseding indictment against Patricio Hernandez, Jonathan Hernandez, Garcia, Holmes, and John Mosley, aka “Breezy,” aka “Brazy.” The charges in the superseding indictment remain pending against Patricio Hernandez and Mosley. 

Acting U.S. Attorney Honig credited special agents of ATF, under the direction of Special Agent in Charge Charlie J. Patterson in Newark, and members of the Newark Department of Public Safety, under the direction of Public Safety Director Anthony F. Ambrose, with the investigation leading to the guilty pleas.

She also thanked the DEA, under the direction of Special Agent in Charge Susan A. Gibson; the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Theodore N. Stephens II; the Essex County Sheriff’s Office, under the direction of Sheriff Armando B. Fontoura; the N.J. State Police, under the direction of Col. Patrick J. Callahan; the Belleville Police Department, under the direction of Chief Mark Minichini; and the Livingston Police Department, under the direction of Chief Gary Marshuetz.

This case is being conducted under the auspices of the Organized Crime Drug Enforcement Task Force (OCDETF) and is part of the Violent Crime Initiative (VCI) in Newark. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply. The VCI 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 to combat 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 New Jersey Division, 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 Board of 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, and the Irvington Police Department. 

The government is represented by Assistant U.S. Attorney Angelica M. Sinopole of the U.S. Attorney’s Office’s Organized Crime and Gangs Unit in Newark.

The charges and allegations against the remaining defendants are merely accusations, and the defendants are considered innocent unless and until proven guilty.

NEWARK, N.J. – Two men today admitted their roles in a Newark carjacking in which a firearm was brandished, Acting U.S. Attorney Rachael Honig announced today.

Rakeem McNair, 21, of Roselle, New Jersey, pleaded guilty today to an information charging him with one count each of carjacking and brandishing a firearm in furtherance of the carjacking. Raquin Tanner, 25, of Newark, pleaded guilty on March 10, 2021, to one count of aiding and abetting the carjacking. Both defendants entered their guilty pleas by videoconference before U.S. District Judge Madeline Cox Arleo and remained detained.

According to documents filed in this case and statements made in court:

On Aug. 13, 2019, the victim parked her car, which she used for her work as an Uber driver, on Summer Avenue in Newark. At approximately 11:00 p.m., the victim was sitting in the driver’s seat when three males approached her car. 

Video surveillance from the scene showed that Tanner walked with the other two males around the corner. As they neared the victim’s car, Tanner spoke to the other two, then went ahead of them, looked into the passenger seat of the car, an upon seeing the lone female driver, signaled the other two males to begin the carjacking.

One of the other males pointed a firearm through the driver’s side window, opened the door and attempted to physically remove the victim from the car. A struggle ensued, and McNair went around the car to aid his conspirator in dragging the victim from the car. McNair and the unidentified male threw the victim violently to the ground and drove away with the vehicle.

The carjacking count carries a maximum potential penalty of 15 years in prison. The brandishing of a firearm during a crime of violence count is punishable by a mandatory minimum of seven years in prison and a maximum sentence of life in prison, which must run consecutively to any term of imprisonment imposed on any other charges. Sentencing is scheduled for July 27, 2021, for McNair and July 12, 2021, for Tanner.

Acting U.S. Attorney Honig credited the Newark Police Department, under the direction of Public Safety Director Anthony Ambrose; the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Theodore N. Stephens II; and special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark, with the investigation leading to the guilty pleas.

The government is represented by Senior Trial Counsel Robert Frazer of the Organized Crime/Gang Unit in Newark.

NEWARK, N.J. – A husband and wife were arrested on weapons charges after a standoff at a Hudson County hotel, Acting U.S. Attorney Rachael A. Honig announced.

Rahim Harris, 42, of Maplewood, New Jersey, is charged by complaint with one count of possession of firearms and ammunition by a convicted felon. His wife, Haneefha White, 39, of Pottsville, Pennsylvania, is charged by complaint with aiding and abetting the possession of firearms and ammunition by a convicted felon. They will have their initial appearances by videoconference at a date to be determined.

According to documents filed in this case and statements made in court:

On Dec. 21, 2019, Harris was charged by complaint with weapons and aggravated assault offenses allegedly committed on that date. On March 14, 2021, law enforcement received information indicating that Harris was in a specific room at a hotel in Secaucus, New Jersey. Law enforcement officers responded to the hotel a few hours later to attempt to locate and arrest Harris, who was identified from a photograph as the person staying in the specific hotel room.

Officers observed Harris’ wife entering the room. They attempted to summon White while she was in the hallway, but she entered the room and closed the door. White then called the front desk and asked why police were in the hallway. Law enforcement officers spoke with White on the telephone to persuade her to come out. She indicated there were other individuals in the room and that they were “on edge” and had firearms and hand grenades.

After several hours of unsuccessful negotiations with White, law enforcement called the room and Harris picked up the phone. Harris stated that he did not want to come out because of the arrest warrant and that he was “prepared for war” and “ready to die.”

In the early hours of March 15, 2021, Harris and White (who were the only occupants of the room) surrendered. A lawful search of the room yielded numerous weapons, fraudulent identification papers, bank cards, $36,910 in cash and a vehicle registration.

Each of the charges carries a maximum penalty of 10 years in prison and a fine of up to $250,000.

This case is part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local and tribal authorities in investigating and prosecuting gun crimes; improves information sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensured that federal resources are directed at the criminals posing the greatest threat to our communities. For more information about Project Guardian, please see https://www.justice.gov/projectguardian

Acting U.S. Attorney Honig credited special agents of the Bureau of Alcohol, Tobacco, Firearms, and Explosives, Newark Division, under the direction of Special Agent in Charge Charlie J. Patterson, with the investigation leading to the charges. She also thanked the Hudson County Prosecutor’s Office; the Secaucus Police Department; the Hudson County Regional SWAT Team; the Hudson County Sheriff’s Office; the Jersey City Police Department Bomb Squad; and the New Jersey Transit Police Department for their roles in the investigation.

The government is represented by Assistant U.S. Attorney Jonathan W. Romankow of the U.S. Attorney’s Office Violent 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.

NEWARK, N.J. – A Sussex County, New Jersey, man was charged for his role in fraudulently obtaining federal Paycheck Protection Program (PPP) loans totaling $1.9 million, Acting U.S. Attorney Rachael A. Honig announced.

John Jhong, 51, of Sparta, New Jersey, is charged by complaint with one count of bank fraud, one count of false representation of a Social Security number and one count of money laundering. Jhong is scheduled to make his initial appearance by videoconference this afternoon before U.S. Magistrate District Judge Leda Dunn Wettre.

According to documents filed in this case and statements made in court:

Jhong submitted 10 fraudulent PPP loan applications to several lenders on behalf of 10 purported businesses. The PPP is overseen by the Small Business Administration designed to provide forgivable loans to small businesses affected by the coronavirus pandemic. Applicants for PPP loans apply directly to banks or financial institutions participating in the program; in those applications, applicants make affirmative certifications about their average monthly payroll expenses and number of employees. Applicants also certify their intent to spend PPP proceeds on permissible business expenses, such as payroll costs, rent, utilities, and interest on mortgages. PPP loans may be entirely forgiven if the recipient spends the loan proceeds on these permissible expenses within a designated period after receiving the proceeds.  

Jhong’s PPP applications allegedly contained false and fraudulent representations to the participating lenders, including documentation purporting to be from the IRS. In fact, according to IRS records, none of the tax documents Jhong submitted with the PPP loan applications were ever filed with the IRS. Jhong also fabricated the existence of numerous business partners. In some instances, the personal identifying information for Jhong’s purported business partners belonged to individuals who had been deceased for over a decade.

Based on Jhong’s alleged misrepresentations, the lenders approved Jhong’s PPP loan applications and provided Jhong’s purported business with $1.9 million in federal COVID-19 emergency relief funds meant for distressed small businesses. Jhong then converted a portion of the proceeds into a cashier’s check that was used to fund a business account.

The count of bank fraud carries a maximum penalty of 30 years in prison and a $1 million fine, or twice the gross gain to the defendant or gross loss to the victim, whichever is greater. The count of false representation of Social Security number carries a maximum penalty of five years in prison and a $250,000 fine, or twice the gross gain to the defendant or gross loss to the victim, whichever is greater. The count of money laundering carries a maximum potential penalty of 20 years in prison and a $500,000 fine, or twice the gross gain to the defendant or gross loss to the victim, whichever is greater.

Acting U.S. Attorney Rachael Honig credited special agents of IRS – Criminal Investigation, under the direction of Special Agent in Charge Michael Montanez; special agents of U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Rodney M. Hopkins; special agents of the Social Security Administration, Office of the Inspector General, under the direction of Special Agent in Charge John F. Grasso; special agents of the Federal Deposit Insurance Corporation – Office of the Inspector General, under the direction of Special Agent in Charge Patricia Tarasca in New York; and special agents of the U.S. Secret Service, under the direction of Special Agent in Charge Mark McKevitt. She also thanked the Sparta Township Police for their assistance.

The government is represented by Assistant U.S. Attorney Olajide A. Araromi of the U.S. Attorney’s Office, Government Fraud Unit, in Newark, and Trial Attorney Chad M. Davis of the  Department of Justice, Criminal Division, Money Laundering and Asset Recovery Section.

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.

NEWARK, N.J. – A California man has been charged with laundering money that originated from fraudulently obtained loans from the U.S. Small Business Association and from a business email compromise scheme that targeted a law firm based in New Jersey, Acting U.S. Attorney Rachael A. Honig announced.

Eric Bullard, 59, of Los Angeles, California, is charged by complaint with one count of money laundering conspiracy. Bullard was taken into custody yesterday in California on an unrelated warrant for a violation of federal supervised release. Bullard is scheduled to appear by videoconference before U.S. Magistrate Judge Alexander MacKinnon at 1:00 p.m. PDT.  

According to documents filed in this case and statements made in court:

In June 2020, Victim 1 communicated via email with a law firm in New Jersey that was helping Victim 1, a resident of Bergen County, New Jersey, with a real estate transaction.  One of the law firm’s email accounts was compromised and someone purporting to be emailing on behalf of the law firm sent instructions to Victim 1 to wire approximately $560,000 into an escrow account under the name “Eric’s Commercial LLC.”  Victim 1 wired approximately $560,000 into a business bank account controlled by Bullard. Victim 1 did not intend for the money to be transferred to Bullard and sent the wire transfer to Bullard’s account under the belief that the wire instructions had come from the New Jersey law firm.            

Prior to receiving the $560,000 wire transfer, the Eric’s Commercial LLC bank account had a beginning statement period balance of approximately $40. Shortly after the $560,000 was transferred into the Eric’s Commercial LLC bank account, on the same day the wire transfer posted to his account, approximately 10 cash withdrawals were made from the account totaling $96,275. Surveillance footage obtained from the bank shows Bullard entering the bank to make withdrawals from the account. The same day, three large wire transfers sourced from the transfer from Victim 1 were executed from the Eric’s Commercial LLC bank account to other bank accounts, including an account controlled by a conspirator.     

In addition to laundering of the proceeds from the business email compromise, Bullard also obtained and laundered funds from the U.S. Small Business Administration’s (SBA) Economic Injury Disaster Loan (EDIL) program.  In July 2020, Bullard received into a business bank account that he controlled $51,395 from an SBA EDIL loan intended for a pharmacy company with a listed location in Idaho and $143,100 from an SBA EDIL loan intended for a pharmacy company with a listed location in Colorado.    

Money laundering conspiracy carries a maximum penalty of 20 years in prison and a fine of up to $500,000 or twice the value of the monetary instrument or funds involved in the transfer, whichever is greater.   

Acting U.S. Attorney Honig credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark, with the investigation leading to the charges.

The government is represented by Assistant U.S. Attorney Jamie L. Hoxie of the Cybercrime Unit in Newark.

The charges and allegations in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.   

NEWARK, N.J. – A Bergen County, New Jersey, man today admitted orchestrating a long-running bank and securities fraud scheme, which led to large-scale losses for financial institutions and investors, Acting U.S. Attorney Rachael A. Honig announced.

Seth Levine, 52, of Teaneck, New Jersey, pleaded guilty by videoconference before U.S. District Judge Madeline Cox Arleo to an information charging him with one count of conspiracy to commit bank fraud and one count of securities fraud.   

According to documents filed in this case and statements made in court:

Levine was the founding partner, owner, and managing member of Norse Holdings, which was the parent company to more than 70 subsidiary companies. Each of the subsidiary companies owned one or more multifamily buildings, located primarily in New Jersey. From 2009 through August 2019, Levine directed a scheme to fraudulently refinance the multifamily properties by providing materially false information to financial institutions about the rents collected, the number of apartments leased, the expenses, and the true owners of the properties.  Levine and others provided lenders fake documents, including falsified leases that created the appearance that vacant spaces were occupied and that overstated the rent paid by tenants; fake personal financial statements; fake expense documents; and fake operating agreements that misrepresented ownership interests in the multifamily properties. Levine also forged signatures on some of the fraudulent documents submitted to lenders. As a result of the fraudulent refinances, Levine received cash payouts from the lenders, which Levine and others used for their own enrichment and to continue the fraud scheme. 

Many of the lenders who approved mortgages based on the false statements of Levine and others in turn sold those mortgages to the Federal Home Loan Mortgage Corporation (Freddie Mac) and the Federal National Mortgage Association (Fannie Mae). Because the refinances were obtained with fraudulent data regarding the properties’ income and expenses, the multifamily properties were overvalued and rents and other income from the properties did not cover the mortgage payments and other expenses associated with the properties. To cover the shortfalls, Levine obtained additional cash-out refinances, thereby increasing his total debt incurred. In total, Levine controlled at least 70 multifamily properties, comprising approximately 2,500 apartments. The outstanding balance of the fraudulently obtained mortgages on the multifamily properties was more than $150 million, including 40 mortgages held by Freddie Mac with an outstanding loan balance of approximately $103 million. The bank fraud conspiracy resulted in losses to victim lenders of at least $65 million.   

While defrauding the lending financial institutions, Levine also carried out a securities fraud scheme to defraud investors in the multifamily properties. He solicited investors to invest in the multifamily properties based on materially false statements and promises about the condition of the properties and the use of investor funds. Levine represented to investors that his conduct would be limited by an operating agreement. However, after Levine acquired the multifamily properties, he violated representations made to the investors, including by selling off portions of Levine’s ownership interest in the properties without investor consent, bringing on additional investors without consent, and refinancing the multifamily properties without investor consent. Levine provided fraudulent documents to investors, such as operating agreements that overstated Levine’s personal investment in the multifamily properties and documents bearing signatures forged by Levine. He also co-mingled investor funds and used the funds in violation of representations to investors, by using investor money to support other multifamily properties, make payments to other investors, and further the fraud. The securities fraud victims lost more than $15 million.       

The conspiracy to commit bank fraud carries a maximum potential penalty of 30 years in prison and a $1 million fine. The securities fraud count is punishable by a maximum of 20 years in prison and a $5 million fine. Sentencing is scheduled for July 26, 2021.

Individuals who believe they may have information about this case may contact the FBI at 1-800-CALL-FBI (225-5324).

Acting U.S. Attorney Honig credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark, and special agents of the Federal Housing Finance Agency, Office of Inspector General, under the direction of Special Agent in Charge, Robert Manchak, with the investigation leading to today’s guilty plea. The U.S. Securities and Exchange Commission has filed a civil complaint against Levine today based on allegations underlying the securities fraud charge. 

The government is represented by Assistant U.S. Attorney Heather Suchorsky of the

Economic Crimes Unit and Special Assistant U.S. Attorney Charlie L. Divine of the Federal Housing Finance Agency, Office of Inspector General.

NEWARK, N.J. – A Middlesex County, New Jersey, man was charged today with tax evasion and filing false tax returns, Acting U.S. Attorney Rachael A. Honig and Acting Deputy Assistant Attorney General Stuart M. Goldberg announced.

Gabriel M. Ferrari of Edison, New Jersey, was indicted by a federal grand jury today on three counts of tax evasion and seven counts of filing false personal and corporate tax returns.  He will have his arraignment and initial appearance at a later date.

According to the indictment:

From 2011 through 2014, Ferrari, owner of Buses and Trucks Inc. (B&T) in Linden, New Jersey, used gross receipts of B&T to pay personal expenses, including gambling on horse races, and then did not disclose the diverted receipts to his return preparer or the IRS. To hide his income, Ferrari filed false business and personal tax returns with the IRS.

Each count of tax evasion carries a maximum potential penalty of five years in prison and a maximum fine of $250,000. Each count of filing a false tax return carries a maximum potential penalty of three years in prison and a maximum fine of $250,000.

Acting U.S. Attorney Honig and Acting Deputy Assistant Attorney General Goldberg credited special agents of IRS-Criminal Investigation Division, under the direction of Special Agent in Charge Michael Montanez in Newark, with the investigation leading to today’s indictment.

The government is represented by Assistant U.S. Attorney Andrew M. Trombly of the Cybercrime Unit in Newark and by Trial Attorney Ann M. Cherry of the Tax Division in Washington, D.C.

The charges and allegations contained in the indictment are merely accusations, and the defendant is considered innocent unless and until proven guilty.

CAMDEN, N.J. – A New York man was charged with traveling to Atlantic County, New Jersey, to have sex with a minor, Acting U.S. Attorney Rachael A. Honig announced today.

Zachary Williams 33, of New York, is charged by complaint with one count of interstate travel to engage in illicit sexual conduct. Williams was arrested on March 13, 2021, after traveling a second time from New York to New Jersey to meet a minor. He is scheduled to appear today by videoconference before U.S. Magistrate Judge Ann Marie Donio.                                                                                                                                 

According documents filed in this case and statements made in court:

In September 2020, Williams met the minor victim via SnapChat. He lied about his age, telling the victim that he was 17-years old. Williams asked the minor for nude photographs of the victim and, after receiving them, began to “sextort” the minor by threatening to send photographs to the victim’s friends and family. He ultimately convinced the victim to meet him at a hotel in Atlantic County and agreed to allow the victim to delete the photographs from Williams’ phone. On Oct. 2, 2020, Williams traveled to a hotel in Atlantic County and, two days later, engaged in sexual intercourse with the victim in his hotel room.

Williams continued to send messages threatening to expose the victim’s photographs, and when the victim would block him, he opened new social media accounts to continue to harass the victim., including “IWILLHURTYOU Iwilll_h2021,” “IWILLGETTHESWITCHBACK,” and “Makeadealormomfindsout.”

In March 2021, law enforcement officers took over the victim’s social media accounts and began communicating with Williams while posing as the victim. During those communications, Williams arranged to travel on March 13, 2021 to the same Atlantic County hotel to again have sex with the victim. Law enforcement arrested Williams as he arrived at the hotel.

Williams is charged with interstate travel to engage in illicit sexual conduct with a minor. If convicted of this offense, Williams faces a maximum of 30 years in prison, a $250,000 fine, or twice the gross gain or loss from the offense, and lifetime supervise release.

Acting U.S. Attorney Honig credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr., in Newark, and officers of the Galloway Township Police Department, under the direction of Chief Donna A. Higbee. She also thanked the Atlantic County Prosecutor’s Office for its assistance.

The government is represented by Assistant U.S. Attorney Diana Vondra Carrig of the U.S. Attorney’s Office in Camden.

The charges and allegations contained in complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

NEWARK, N.J. – A former chief investment officer of a medical property management company pled guilty today to a bank fraud conspiracy involving a $91.5 million commercial mortgage loan, Acting U.S. Attorney Rachael A. Honig announced.

Barton Schack, 65, of Ringwood, New Jersey, was charged by information with one count of conspiracy to commit bank fraud.  United States District Court Judge Madeline Cox Arleo accepted the guilty plea.      

According to documents filed in this case and statements made in court:

Schack was the chief investment officer of Regent Medical Properties (“Regent”), a property management company located in Glen Rock, New Jersey.  Sovereign Medical Services, and affiliates (“Sovereign”), was a network of multi-specialty, out-patient medical practices headquartered in Glen Rock, New Jersey, with various practice locations.  Co-conspirator 1 was the founder and chief executive officer of both Regent and Sovereign.

In April 2016, Schack and Co-conspirator 1 used fraudulent representations to obtain a $91.5 million loan (the “Mortgage Loan”) from Lender 1 and others secured by thirteen medical office buildings in New Jersey, New York, and Florida (the “Medical Properties”).  The borrowers in the Mortgage Loan were thirteen separate special purpose entities—majority-owned by Co-conspirator 1—one for each collateral property (collectively, the “Borrowers”). 

Schack and Co-conspirator 1 exploited the fact that, through Sovereign, Co-conspirator 1 controlled approximately half of the tenants in the Medical Properties.  Schack and Co-conspirator 1 misrepresented to Lender 1 the physical occupancy status of certain affiliated tenants and the Medical Properties’ true rental income.

After the Mortgage Loan closed, Schack and Co-conspirator 1 continued their scheme to conceal the actual financial status of the Medical Properties by submitting fraudulent financial statements to the loan servicer on a monthly basis.  Those misrepresentations allowed Schack and Co-conspirator 1 to avoid accelerated payment on the Mortgage Loan.

Finally, after the Mortgage Loan closing, Schack and Co-conspirator 1 diverted rent payments owed through the “lockbox” account procedure specified in the Mortgage Loan agreement.  Instead, Schack and Co-conspirator 1 used the funds for both Regent’s operating expenses and Co-conspirator 1’s personal expenses, including credit card bills of up to approximately $80,000 per month and private jet payments.  Through such means, Co-conspirator 1 diverted millions of dollars in rental payments from the “lockbox” account over the course of the Mortgage Loan for his own personal use.

Shortly after the closing of the Mortgage Loan in April 2016, Lender 1 sold its interest into two commercial mortgage-backed security loans.  By 2019, approximately three years after the closing of the Mortgage Loan, the Borrowers were sixty days behind on loan payments, and administration of the loan was referred to a special servicer.  In February 2020, the Borrowers declared bankruptcy.   

The conspiracy to commit bank fraud count carries a maximum penalty of 30 years in prison and a $1 million fine. Sentencing is scheduled for June 22, 2021.  

Acting U.S. Attorney Honig credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch, Jr., and IRS-Criminal Investigation, under the direction of Special Agent in Charge Michael Montanez, with the investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorneys Andrew Macurdy and Shawn Barnes of the U.S. Attorney’s Office Criminal Division.                                    

Defense counsel:  Brent Culpepper, Esq.

CAMDEN, N.J. – An Atlantic City, New Jersey, man appeared today following his arrest on charges of escaping from federal custody, Acting U.S. Attorney Rachael A. Honig announced.

Patrick Giblin, 56, of Atlantic City, New Jersey, is charged by complaint with escape from the custody of the Attorney General. Giblin made his initial appearance by videoconference today before U.S. Magistrate Judge Ann Marie Donio.   

According to the complaint and court documents:

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 2017 sentence 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’ imprisonment 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.

Giblin faces up to five years in prison if convicted of the escape charge. 

Acting U.S. Attorney Honig credited members of the U.S. Marshals Service, District of New Jersey, under the direction of U.S. Marshal Juan Mattos Jr., with the investigation leading to the arrest and charges. 

The government is represented by Assistant U.S. Attorney Gabriel J. Vidoni of the U.S. Attorney’s Office’s Criminal Division in Camden.

The charge and allegations contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty. 

CAMDEN, N.J. – A Camden County man and a Bronx, New York, man were charged for their participation in a scheme to steal bank customer identities and then use that information to steal more than $600,000, Acting U.S. Attorney Rachael A. Honig announced today.

Jamere Hill-Birdsong, 32, of Gloucester City, New Jersey, and Lamar Melhado, 31, of the Bronx, New York, are each charged in a 10-count indictment with one count of conspiracy to commit bank fraud, multiple counts of bank fraud and aggravated identity theft. Both Hill-Birdsong and Melhado were arrested and will appear before U.S. Magistrate Judge Ann Marie Donio in Camden federal court via videoconference this afternoon.

According to the indictment:

From August 2016 through August 2017, Hill-Birdsong and Melhado conspired with each other and others to defraud a Mount Laurel, New Jersey, bank. Hill-Birdsong worked inside the call center and recruited other call center employees to participate in the scheme by stealing the identities and account information of customers who called into the bank’s call center. The conspirator bank employees would then take photographs or screenshots of the bank customer’s account information and signatures and would send that information to Hill-Birdsong and Melhado. The conspirators then had phony identification documents made in the names of the bank customers, and used various runners to go into bank branches and make unauthorized cash withdrawals. The conspirators also used the stolen identity information to conduct unauthorized online transfers of moneys from the customer’s accounts.

Hill-Birdsong is charged with bank fraud conspiracy, five counts of bank fraud and one count of aggravated identity theft. Melhado is charged with bank fraud conspiracy, six counts of bank fraud and two counts of aggravated identity theft. Each count of conspiracy to commit bank fraud and bank fraud are punishable by a maximum of 30 years in prison and a $1 million fine, or twice the gross gain or loss from the offense. Each count of aggravated identity theft is punishable by an additional consecutive term of imprisonment of up to two years.

Acting U.S. Attorney Honig credited agents of the FBI’s South Jersey Resident Agency, under the direction of Special Agent in Charge Michael J. Driscoll in Philadelphia, with the investigation leading to the indictment.

The government is represented by Assistant U.S. Attorney Diana Vondra Carrig of the U.S. Attorney’s Office in Camden.

The charges and allegations contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

TRENTON, N.J. – A Trenton man admitted conspiring with others to distribute fentanyl that caused the death of a Monmouth county woman, Acting U.S. Attorney Rachael A. Honig announced today.

Quasaan Bethea, 33, pleaded guilty by videoconference before Chief U.S. District Judge Freda L. Wolfson on March 10, 2021, to Count Two of an indictment charging possession with intent to distribute fentanyl.

According to the documents filed in this case and statements made in court:

On May 15, 2018, Bethea conspired with others to distribute fentanyl to a 39-year-old Monmouth County woman, referred to in the indictment as Victim-1. Victim-1 had sought out Bethea and others to purchase heroin, not fentanyl, a significantly more potent narcotic than heroin. Bethea admitted that the fentanyl he sold to Victim-1 was stamped “CAMEL” and packaged to look like heroin. Shortly after Victim-1’s second purchase of fentanyl from Bethea and others, Englishtown police responded to a report of an overdose death. Upon their arrival, they discovered Victim-1, and in Victim-1’s possession were several wax folds of suspected heroin stamped “CAMEL” and empty wax folds stamped “CAMEL” as well. Laboratory analysis of these wax folds bearing the “CAMEL” stamp determined the substance to be fentanyl. An autopsy of Victim-1 found her cause of death to be acute fentanyl toxicity.

The count of conspiracy to distribute and possess with intent to distribute fentanyl carries a maximum penalty of 20 years in prison and a $1 million fine. Sentencing is scheduled for July 26, 2021.

Acting U.S. Attorney Honig credited special agents of the Drug Enforcement Administration, under the direction of Special Agent in Charge Susan A. Gibson; detectives from the Monmouth County Prosecutor’s Office, under the direction of Prosecutor Christopher J. Gramiccioni; the Englishtown Police Department, under the direction of Peter S. Cooke, Jr., and the Trenton Police Department’s Narcotics Task Force, under the direction of Police Director Sheilah Coley, with the investigation leading to the guilty plea.

The government is represented by Assistant U.S. Attorney Ryan L. O’Neill, of the Office’s Opioids Abuse & Prevention Task Force.

NEWARK, N.J. – A Nebraska man was sentenced today to 21 months in prison for engaging in fraudulent activity that exposed his employer’s confidential information, Acting U.S. Attorney Rachael A. Honig announced. 

Timothy Young, 50, of Moorefield, Nebraska, previously pleaded guilty by videoconference before U.S. District Judge Katharine S. Hayden in Newark federal court to an information charging him with wire fraud. Judge Hayden imposed the sentence by videoconference today.

According to documents filed in the case and statements made in court:

Young was employed at a data analytics and risk assessment firm based in New Jersey. The company serves customers worldwide, including entities providing insurance and financial services as well as government entities. The company maintains a network that houses, among other things, significant amounts of personally identifiable information.

Without the firm’s approval, Young obtained confidential, non-public information that belonged to the firm. The information included names, logon names, passwords, email addresses, and telephone numbers for some of the company’s clients. Young then attempted to sell the information.

In addition to the prison term, Judge Hayden sentenced Young to three years of supervised release and ordered him to pay restitution of $296,370.

Acting U.S. Attorney Honig credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark, and task force officers from the N.J. State Police, Jersey City Police Department, Ocean City Police Department, and Federal Protective Service, with the investigation leading to today’s sentencing. She also thanked the FBI’s Omaha Division, under the direction of Special Agent in Charge Kristi Koons Johnson, for its role in the investigation.

The government is represented by Assistant U.S. Attorney Andrew Kogan of the U.S. Attorney’s Office Cybercrime Unit in Newark. 

NEWARK, N.J. – The Justice Department today announced an agreement with the Township of Toms River, New Jersey, to resolve allegations that the township violated the Religious Land Use and Institutionalized Persons Act (RLUIPA), by severely restricting where houses of worship can locate within its jurisdiction.   

The proposed consent decree, which was filed today in the U.S. District Court of the District of New Jersey and must still be approved by the court, would resolve a lawsuit the United States also filed today alleging that the township’s zoning code places unreasonable limits on where religious assemblies and institutions may locate, substantially burdens religious exercise, and treats religious assemblies and institutions on less than equal terms with nonreligious assemblies and institution. 

“Federal law protects religious communities against unequal treatment and unwarranted burdens,” Rachael A. Honig, Acting U.S. Attorney for District of New Jersey, said. “Zoning regulations that impose unreasonable restrictions or prevent religious faiths from having a place to worship violate RLUIPA. Through the resolution entered today, this office takes another step to put an end to unlawful zoning practices and vindicate the civil rights of minority religious communities in the District of New Jersey.” 

“RLUIPA protects people of all faiths in their right to exercise their religion,” said Principal Deputy Assistant Attorney General Pamela S. Karlan of the Civil Rights Division.  “The Department of Justice has long enforced RLUIPA against zoning regulations that unreasonably burden religious exercise by imposing unwarranted restrictions and conditions on the location of houses of worship.”

The complaint alleges that since 2009, Toms River has enacted a series of revisions to its zoning code – including a 10-acre parcel minimum requirement – which greatly reduced both the number of zoning districts in which houses of worship can locate and the number of sites available for houses of worship. These restrictions have had a particular impact on the township’s Orthodox Jewish population, who, because of their faith and religious traditions, tend to worship at small houses of worship, which they walk to and from on the Sabbath and Holidays. The complaint also alleged that the township’s zoning ordinance treats houses of worship and other religious assemblies and institutions on less favorable terms than nonreligious assemblies and institutions.

As part of the consent decree, the township will revise its zoning code to: reduce the minimum acreage required for a house of worship in many zoning districts from 10 acres to two acres; allow houses of worship as-of-right in certain zoning districts; allow smaller houses of worship to be located on minor collector roads; and treat houses of worship on comparable terms to nonreligious places of assembly. The consent decree also requires the township to train its officials and employees on RLUIPA’s requirements, establish a procedure for receiving and resolving RLUIPA complaints, and other injunctive relief. 

RLUIPA is a federal law that protects religious institutions from unduly burdensome or discriminatory land use regulations. In June 2018, the Justice Department announced its Place to Worship Initiative, which focuses on RLUIPA’s provisions that protect the rights of houses of worship and other religious institutions to worship on their land. More information is available at www.justice.gov/crt/placetoworship.

In July 2018, the Department of Justice announced the formation of the Religious Liberty Task Force. The Task Force brings together department components to coordinate their work on religious liberty litigation and policy, and to implement the Attorney General’s 2017 Religious Liberty Guidance.

Individuals who believe they have been subjected to discrimination in land use or zoning decisions may contact the Civil Rights Division Housing and Civil Enforcement Section at (800) 896-7743, or the U.S. Attorney’s Office Civil Rights Hotline at (855) 281-3339, or may submit a complaint through the complaint portal on the Place to Worship Initiative website. More information about RLUIPA, including questions and answers about the law and other documents, may be found at http://www.justice.gov/crt/about/hce/rluipaexplain.php.

The United States is represented by Assistant U.S. Attorney Michael E. Campion, Chief of the U.S. Attorney’s Office’s Civil Rights Unit, Civil Division, Assistant U.S. Attorney Susan Millenky, of the Civil Rights Unit, Civil Division, and Trial Attorneys Ryan G. Lee and Noah D. Sacks, U.S. Department of Justice, Civil Rights Division, Housing and Civil Enforcement Section.

NEWARK, N.J. – A former pharmacy technician was arrested today for stealing prescription HIV medications from the pharmacy of the Veterans Affairs Medical Center (VAMC) in East Orange, New Jersey, Acting U.S. Attorney Rachael A. Honig announced.

Lisa M. Hoffman, 48, of Orange, New Jersey, is charged by complaint with theft of medical products, specifically HIV medication. Hoffman is scheduled to make her initial appearance by videoconference before U.S. Magistrate Judge Mark Falk this afternoon.

According to documents filed in this case and statements made in court:

Hoffman’s responsibilities at the VAMC included ordering the necessary drugs and supplies for the outpatient pharmacy, including determining when to place orders and for what products, as well as regularly maintaining inventory levels of needed drugs and supplies. From at least August 2017 through November 2019, Hoffman used her position to steal prescription HIV medication from the VAMC. She placed large orders for HIV medication, purportedly on behalf of VAMC, and then stole the medication after it was delivered. VAMC surveillance footage captured Hoffman regularly taking dozens of bottles of HIV medications from the shelves of the outpatient pharmacy, placing them in a white mail bin, and then transferring the medications from the mail bin to her bag and exiting with the stolen medication. Hoffman stole approximately $8.2 million worth of the VAMC’s HIV medication.

Once Hoffman had the medication, Hoffman met her associate, Wagner Checonolasco, aka “Wanny,” 33, of Lyndhurst, New Jersey, often at her residence, so that she could sell the stolen HIV medication to Checonolasco for cash. After obtaining the stolen HIV medication, Checonolasco resold it to others.       

Checonolasco was previously charged with conspiracy to steal government property.  Those charges remain pending.

The charge of theft of medical products is punishable by a potential penalty of 20 years in prison, and a fine of $1 million, or three times the economic loss attributable to the offense.

Acting U.S. Attorney Honig credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark, and the U.S. Department of Veterans Affairs, Office of Inspector General, Northeast Field Office, under the direction of Special Agent in Charge Christopher F. Algieri, with the investigation leading to the charges.

The government is represented by Assistant U.S. Attorney Nicole F. Mastropieri of the Health Care Fraud Unit.

The charges and allegations contained in the complaints are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

TRENTON, N.J. – A Trenton man was sentenced today to 48 months in prison for unlawfully possessing a semi-automatic rifle while attempting to sell it to another individual, Acting U.S. Attorney Rachael A. Honig announced.

Edwin Gaines, 59, previously pleaded guilty by videoconference before U.S. District Judge Peter G. Sheridan to an information charging him with one count of possession of a firearm by a convicted felon. Judge Sheridan imposed the sentence by videoconference today.

According to documents filed in this case and statements made in court:

On Feb. 15, 2019, Gaines, who previously had been convicted of murder in New Jersey Superior Court and who has other felony convictions, arranged to sell to another individual a Ruger .22 semi-automatic rifle as well as an extended magazine. The purchaser, however, was acting at the direction and supervision of law enforcement. In a video- and audio-recorded transaction in the basement of a Trenton residence, the individual purchased the rifle and magazine from Gaines using money that law enforcement had provided.

In addition to the prison term, Judge Sheridan sentenced Gaines to three years of supervised release.

Acting U.S. Attorney Honig credited special agents of the Bureau of Alcohol, Tobacco, Firearms, and Explosives, Newark Division, Trenton Field Office, under the direction of Special Agent in Charge Charlie J. Patterson; detectives from the New Jersey State Police, under the direction of Superintendent Col. Patrick J. Callahan; and officers of the Trenton Police Department, under the direction of Police Director Sheilah Coley, with the investigation leading to today’s sentencing.

The government is represented by Special Assistant U.S. Attorney Katie Lee of the U.S. Attorney’s Office’s Criminal Division in Trenton.

NEWARK, N.J. – Two Newark men made their initial appearances today on charges stemming from a Feb. 22, 2021, attempted carjacking in Newark during which a firearm was discharged, Acting U.S. Attorney Rachael A. Honig announced.

Antwan Malone, 34, and Dawan Walker, 24, both of Newark, are charged by complaint with one count of attempted carjacking and one count of discharging of a firearm during a crime of violence. They appeared by videoconference today before U.S. Magistrate Judge Mark Falk and were detained.

According to documents filed in this case and statements made in court:

On Feb. 22, 2021, law enforcement officers responded to the area of the I-78 West entrance ramp and Irvine Turner Boulevard in Newark on a report of an attempted carjacking with a weapon. They learned that Malone and Walker had pulled up beside a blue BMW M5 SUV that was stopped at a stop light and blocked the BMW’s ability to enter I-78. Malone approached the vehicle brandishing a handgun, and then pointed the gun at the driver’s face while repeatedly telling the driver to either exit the vehicle or Malone would shoot them. At that point, the driver was able to escape by ramming the BMW into Malone and Walker’s vehicle and entering the I-78 entrance ramp. Malone fired two shots at the BMW. 

The count of attempted carjacking carries a maximum potential sentence of 15 years in prison. The count of discharging of a firearm during a crime of violence is punishable by a mandatory minimum of 10 years in prison and a maximum sentence of life in prison, which must run consecutively to any term of imprisonment imposed on any other charges.

Acting U.S. Attorney Honig credited the New Jersey State Police, under the direction of Col. Patrick J. Callahan; the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Theodore N. Stephens II; special agents of the DEA, under the direction of Special Agent in Charge Susan A. Gibson in Newark; and special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark, with the investigation leading to the charges and arrests.

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, and the Irvington Police Department.

The government is represented by Assistant U.S. Attorney George L. Brandley of the OCEDTF 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.

NEWARK, N.J. – A South Carolina investment fund manager today admitted his role in a scheme to fraudulently obtain over $20 million from investors through misrepresentations about trading strategy and fund performance, Acting U.S. Attorney Rachael A. Honig announced.

George Heckler, 64, of Charleston, South Carolina, pleaded guilty by videoconference before U.S. District Judge Madeline Cox Arleo to an information charging him with one count of securities fraud.      

According to documents filed in this case and statements made in court:

Heckler managed, controlled or was involved with multiple investment funds, including Conestoga Partner Holdings (Conestoga), Cassatt Short Term Trading Fund LP (Cassatt), CV Special Opportunity Fund LP (CVSO), and TA1 LLC (TA1). 

From 2014 to 2018, Heckler misrepresented to investors that he would invest their funds in particular trading strategies. Instead, he diverted their funds out of Cassatt and TA1 for purposes inconsistent with the trading strategies, including to pay out millions of dollars to other investors. Heckler also used investors’ funds to cover investment losses suffered by other funds under his management and/or control.

Heckler solicited investments from Victim-1, claiming the investments would be invested in Cassatt, which employed a “first loss” trading strategy intended to protect investors from losses. However, as of December 2013, Cassatt no longer had a brokerage account that was necessary to employ the represented trading strategy. Despite Cassatt no longer having a brokerage account, in 2014, Heckler represented to Victim-1 that Cassatt was still engaged in a first loss trading strategy and solicited Victim-1’s investment in Cassatt. In September 2014, Victim-1 invested approximately $9.1 million in Cassatt, relying on Heckler’s representation that Victim-1’s money would be invested consistent with Cassatt’s first loss trading strategy.  Heckler used $4.6 million of Victim-1’s investment to repay existing investors and the remainder to satisfy other obligations Heckler owed that were unrelated to Cassatt.

Heckler also approached Victim-2 about the possibility of creating a hedge fund that would deploy capital to first-loss traders, who would serve as the “first loss” protection for investors’ capital. In late 2015, Victim-2 formed a hedge fund, utilizing the concept proposed by Heckler (Entity-1). In 2015 and 2016, Entity-1 invested $10.1 million in TA1 via a participation agreement that provided that Entity-1’s investment would be used for an “options arbitrage dividend recapture trade,” otherwise known as the “skate trade.” In fact, none of Entity-1’s investment was used for the “skate trade.”  Entity-1’s investment was used for other purposes, including repaying others who had previously invested with Heckler.

Over the course of the scheme, Heckler sent out statements to investors that misled them into believing the value of their investments was increasing, when, in fact, the value was declining. Heckler took approximately $1 million in fees and distributions from the fraudulently obtained investments for his personal use. 

The securities fraud count carries a maximum penalty of 20 years in prison and a $5 million fine. Sentencing is scheduled for July 15, 2021.

The U.S. Securities and Exchange Commission has filed a civil complaint against Heckler based on the allegations underlying the securities fraud charge.

Acting U.S. Attorney Honig credited special agents of the FBI, under the direction of Special Agent in Charge Michael J. Driscoll, Philadelphia Field Office, with the investigation leading to the charge. 

The government is represented by Assistant U.S. Attorneys Catherine R. Murphy and Andrew Macurdy of the U.S. Attorney’s Office Criminal Division.

NEWARK, N.J. – A Passaic County man today admitted to coercion and enticement of a minor and to illegally reentering the United States, Acting U.S. Attorney Rachael A. Honig announced.

Juan Carlos Morales-Pedraza, 34, of Paterson, New Jersey, pleaded guilty by videoconference before U.S. District Judge Stanley R. Chesler to a superseding information charging him with coercion and enticement of a minor and of illegally re-entering the United States after having previously been deported.

According to documents filed in this case and statements made in court:

On April 13, 2019, Morales-Pedraza approached a 15-year-old victim in Passaic County.  Two days later, after engaging in sexual intercourse with the victim, Morales-Pedraza and the victim left the New Jersey, with plans to travel to Illinois. Morales-Pedraza admitted that he planned to engage in sexual conduct with the victim in Illinois. Law enforcement arrested Morales-Pedraza in Ohio. 

Morales-Pedraza admitted that he is a citizen of Mexico and that he illegally entered the United States after having previously been deported.

The count of coercion and enticement carries a maximum penalty of 20 years in prison, a $250,000 fine, and mandatory restitution. The count of illegal re-entry carries a maximum prison sentence of two years and a $250,000 fine. Sentencing is scheduled for July 14, 2021.

Acting U.S. Attorney Honig credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark; the Passaic County Prosecutor’s Office’s Sexual Investigations Unit, under the direction of Prosecutor Camelia M. Valdes, and investigators with the Ohio State Highway Patrol and the Lake Township Police Department in Lake Township, Ohio, with the investigation leading to the charges.

The government is represented by Assistant U.S. Attorney Francesca Liquori of the Organized Crime and Gangs Unit.

NEWARK, N.J. – A Passaic County, New Jersey, man today admitted distributing fentanyl, Acting U.S. Attorney Rachael A. Honig announced.

Tawan Grier, a/k/a “TJ,” 22, of Paterson, New Jersey, pleaded guilty by videoconference before U.S. District Judge Brian R. Martinotti to an information charging him with knowingly and intentionally distributing fentanyl.

According to documents filed in this case and statements made in court:

Grier is an associate of the 230 Boys street gang, which operates primarily around Rosa Parks Boulevard and Godwin Avenue in Paterson. Through numerous controlled purchases of narcotics, consensually recorded telephone calls and text messages, physical surveillance, and the analysis of telephone call detail records, law enforcement officers determined that from September 2018 through Oct. 1, 2019, Grier and other members and associates of the 230 Boys distributed narcotics, including heroin, fentanyl, and cocaine base.

The count of distributing fentanyl carries a maximum penalty of 20 years in prison and a fine of at least $1 million. Sentencing is scheduled for July 14.

This case is being conducted under the auspices of the Organized Crime Drug Enforcement Task Force (OCDETF). The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.

Acting U.S. Attorney Honig credited special agents and task force officers with the Bureau of Alcohol, Tobacco, Firearms and Explosives, Newark Division, under the direction of Special Agent in Charge Charlie J. Patterson; special agents of the Drug Enforcement Administration, under the direction of Special Agent in Charge Susan A. Gibson in Newark; officers of the N.J. State Police, under the direction of Col. Patrick J. Callahan; officers of the Paterson Police Department, under the direction of Director Jerry Speziale and Police Chief Ibrahim Baycora; detectives of the Passaic County Prosecutor’s Office, under the direction of Prosecutor Camelia Valdes; and the Passaic County Sheriff's Office, under the direction of Sheriff Richard H. Berdnik, with the investigation leading to the charges. She also thanked the U.S. Marshals Service, the Bergen County Sheriff's Office and the Belleville and Livingston police departments for their assistance with the case.

The government is represented by Assistant U.S. Attorney Francesca Liquori, of the Organized Crime and Gangs Unit.

NEWARK, N.J. –  An Amtrak employee was arrested last night for stealing chainsaws and chainsaw parts valued at over $50,000 from Amtrak and reselling them, primarily through an online auction service, Acting U.S. Attorney Rachael A. Honig announced today.

Jose Rodriguez, 48, of Brick, New Jersey, is charged by complaint with one count of theft from an agency receiving federal funds and one count of theft of government property. Rodriguez is scheduled to appear via videoconference this afternoon before U.S. Magistrate Judge Mark Falk in Newark federal court.

According to the documents filed in this case and statements made in court:

Rodriguez has been an Amtrak employee since October 2007, most recently as a senior engineer and repairman, based out of an Amtrak facility in North Brunswick, New Jersey.  Between August 2016 and July 2020, Rodriguez obtained 77 chainsaws, 103 bars, and 163 chains from Amtrak, the total value of which was over $50,000. Rodriguez used an online auction service to sell most of the Amtrak chainsaws and parts to purchasers throughout the United States. Rodriguez also directly contacted one purchaser on multiple occasions offering to sell chainsaws and parts the day before or the same day that Rodriguez picked up chainsaws and parts from Amtrak. Agents recovered several chainsaws that Rodriguez sold, which had serial numbers matching Amtrak’s chainsaws. One of those chainsaws had previously been reported stolen by Amtrak. 

The offenses charged in the complaint each carry a maximum penalty of 10 years in prison and maximum fine of $250,000. 

Acting U.S. Attorney Honig credited detectives from Amtrak Police New York Division and Mid-Atlantic Division, under the direction of Chief Sam Dotson, and special agents from Amtrak Office of Inspector General, under the direction of Special Agent in Charge Michael J. Waters, Eastern Field Office, with the investigation leading to the charges.

The government is represented by Assistant U.S. Attorneys Cari Fais and Jeffrey Manis of the Office’s Special Prosecutions Division in Newark.

The charges and allegations contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

NEWARK, N.J. – A New Jersey physician and his medical practice will pay $106,255 to resolve allegations that they violated the False Claims Act by making false representations in connection with submissions to the Centers for Medicare & Medicaid Services, Acting U.S. Attorney Rachael A. Honig announced today. 

According to the contentions of the United States contained in the settlement agreement:

From Jan. 1, 2016, through March 31, 2020, Vedat Obuz and his medical practice, Lotus Clinics P.C./Lotus Family Medicine, falsely billed certain medical procedures to Medicaid and Medicare by representing that the procedures had been performed by Obuz when, in fact, those procedures were performed by nurse practitioners.

The allegations were originally made in a lawsuit filed under the whistleblower provisions of the False Claims Act by Kathleen Menold. The Act permits private parties to sue for false claims on behalf of the United States and to share in any recovery. Ms. Menold will receive 20 percent from the federal share of the settlement.

The government’s pursuit of this lawsuit illustrates its efforts to combat 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).  

Acting U.S. Attorney Honig credited special agents of 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; and special agents of the U.S. Attorney’s Office for the District of New Jersey, under the direction of Supervisory Special Agent Thomas Mahoney, with the investigation leading to the settlement.

The government is represented by Assistant U.S. Attorney Daniel Meyler of the Health Care Fraud Unit in Newark. 

The lawsuit is captioned United States ex rel. Menold v. Lotus Family Medicine, Vedat Obuz, and Ozlem Obuz, 17-cv-1728 (D.N.J.). The claims settled by this agreement are allegations only, and there has been no determination of liability.

NEWARK, N.J. – A former police officer with the North Brunswick police department today admitted his role in a multimillion-dollar scheme that defrauded state health benefits programs through the submission of medically unnecessary prescriptions for compounded medications, Acting U.S. Attorney Rachael A. Honig announced.

Daniel Passafiume, 45, of Monroe, New Jersey, pleaded guilty by videoconference before U.S. District Judge Michael A. Shipp to an information charging him with conspiring to commit health care fraud.

According to documents filed in this case and statements made in court:

Between January 2014 and November 2016, Passafiume and a conspirator, identified as CC-1 in the information, marketed certain prescription “compounded medications,” including vitamins and pain creams, to beneficiaries of New Jersey state insurance plans, including the State Health Benefits Program (SHBP). These insurance plans paid thousands of dollars for compounded medications, which are specialty medications mixed by a pharmacist to meet the specific medical needs of an individual patient. Although compounded 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 because, for example, the patient is allergic to a dye or other ingredient or requires the medication in a different form.

Passafiume and his conspirator had agreements with pharmacies to collect large commission payments for each prescription they obtained for the pharmacy. Passafiume and CC-1 found individuals with these insurance plans and connected them with doctors who were willing to sign prescriptions without an examination or a determination that the individuals needed the compounded medications. Those recruited to obtain prescriptions included employees of a New Jersey police department, family members of these employees, and Passafiume’s own family members. At times, Passafiume provided beneficiaries with cash, checks, and gift cards for agreeing to obtain these prescriptions.

The conspiracy charge carries a maximum potential penalty of 10 years in prison and a fine of $250,000 fine, or twice the gain or loss from the offense, whichever is greater. As part of his plea agreement, Passafiume must forfeit $284,659 in criminal proceeds and pay restitution of $3.27 million. Sentencing is scheduled for July 12, 2021.  

Acting U.S. Attorney Honig credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark, with the investigation leading to today’s guilty plea.

The government is represented by Senior Trial Counsel Leslie Faye Schwartz of the Special Prosecutions Division and Assistant U.S. Attorney Osmar J. Benvenuto of the Health Care Fraud Unit in Newark.

NEWARK, N.J. – A New Jersey cardiologist today admitted unlawfully prescribing thousands of Oxycodone pills, Acting U.S. Attorney Rachael A. Honig announced.

Raymond Catania, 59, of Warren, New Jersey, 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.

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.

Catania faces a maximum penalty of 20 years in prison and a $1 million fine. Sentencing is scheduled for July 14, 2021. 

Acting U.S. Attorney Honig credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark, with the investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorney Osmar J. Benvenuto of the Health Care Fraud Unit, and Leslie F. Schwartz, Senior Litigation Counsel, of the Special Prosecutions Division, in Newark.

NEWARK, N.J. – Three Essex County correctional officers and one sergeant have been charged with conspiring to violate a pretrial detainee’s civil rights, Acting U.S. Attorney Rachael A. Honig announced today.

Officers Angel Chaparro, 38, Damion James, 40, and Luis Ortiz, 29, and Sgt. Herman Pride, 51, are each charged by complaint with one count of conspiracy to violate civil rights.  Pride and Ortiz were arrested on March 4, 2021, and had their initial appearances before U.S. Magistrate Judge James B. Clark III. Both were released on bail. Chaparro and James were arrested this morning and will have their initial appearances by videoconference Judge Clark this afternoon. 

According to the criminal complaint:

On the evening of Aug. 17, 2020, a federal pretrial detainee at Essex County Correctional Facility (ECCF) squirted a mixture of urine, yogurt, and milk onto a correctional officer. The detainee subsequently was transported to a disciplinary cell, where Chaparro, James, and Ortiz assaulted the detainee, striking him multiple times. Pride did not intervene to stop the assault. At the end of the assault, Pride said, “okay, that’s enough.” During the assault, James’ watch fell off. He and other officers returned to the detainee’s cell to retrieve his watch.

The detainee asked for, and was initially denied, medical assistance. The victim later told Pride that if Pride would provide the victim with medical attention, the victim would lie and say that he had fallen off his bed. Pride refused to provide any medical attention. Two days later, the detainee was finally taken to the emergency room at University Hospital in Newark. He was diagnosed with large swelling and tenderness in the right side of his face and discoloration and bruising around his right eye.

The defendants all were required to submit documentation regarding their use of force.  None of them submitted any such reports. Instead, Chaparro signed a false report indicating that no force had been used. 

Acting U.S. Attorney Honig credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark; and the Essex County Correctional Facility Internal Affairs Bureau, under the direction of Director Alfaro Ortiz and the Office of the Warden, with the investigation leading to the charges.

The government is represented by Acting Principal Assistant U.S. Attorney Rahul Agarwal.

The charges and allegations in the criminal complaint are merely accusations, and the defendants are all presumed innocent unless and until proven guilty.

NEWARK, N.J. – A portfolio manager and senior independent executive advisor at a Secaucus-based real estate fund was charged with using a sham loan document to defraud an investor of hundreds of thousands of dollars, Acting U.S. Attorney Rachael A. Honig announced today.

Thomas Nicholas Salzano, aka “Nick Salzano,” of Secaucus, New Jersey, was charged by complaint with one count of wire fraud and one count of aggravated identity theft. Salzano appeared by videoconference on March 4, 2021, before U.S. Magistrate Judge Leda Dunn Wettre and was released on a $100,000 unsecured bond.

According to documents filed in this case and statements made in court:

Salzano was employed at National Realty Investment Advisors (NRIA), a private real estate management fund with a purported $1.25 billion in assets under management as of 2021. In May 2018, Victim 1 purchased three purported units in NRIA’s real estate investment fund for $150,000, after hearing an advertisement for the fund on the radio. Individual 1, a vice president and senior independent project manager at NRIA, offered Victim 1 a guaranteed 6 percent return for each unit purchased, paid monthly, for the first two to two-and-a-half years of the five-year term, and the potential of greater guaranteed returns after the initial period. 

Near the end of 2018, Individual 1 approached Victim 1 about a supposed new opportunity to become a joint venture partner with NRIA in a property in North Bergen, New Jersey, allegedly owned by NRIA. According to Individual 1, the minimum investment was $300,000, and Victim 1 could use her original $150,000 investment in the NRIA fund toward the required $300,000 investment in the North Bergen property.  

Victim 1 asked Individual 1 for more information on the North Bergen property. Individual 1 sent Victim 1 materials purporting to show that NRIA intended to obtain a $25 million bank loan on the property. Victim 1 asked for information on the loan. Individual 1 then referred Victim 1 to Salzano.

On Jan. 17, 2019, Salzano emailed Victim 1 a purported letter of intent (LOI) from Lender 1, a loan provider for estate investors and developers, purportedly signed by Victim 2, the chief executive officer of Lender 1. The LOI sent by Salzano was fraudulent. A representative later confirmed that the letter was fraudulent and Victim 2’s signature was forged.   

The wire fraud charge carries a maximum potential penalty of 20 years in prison and a fine of $250,000. The aggravated identity theft charge is punishable by a mandatory sentence of two years in prison to be served consecutively to any other term of imprisonment imposed.

Acting U.S. Attorney Honig credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark, with the investigation leading to the charges.

The government is represented by Assistant U.S. Attorneys Andrew Macurdy and Jonathan Fayer of the of the U.S. Attorney’s Office Economic Crimes Unit.

The charges and allegations in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

NEWARK, N.J. – Four individuals admitted to their roles in conspiring to transport stolen property derived from home burglaries across state lines and related crimes, Acting U.S. Attorney Rachael A. Honig announced today.

Julian Zorilla, 53, Erica Rincon, 39, Jhonatan Lozada Serna, 32, all Colombian nationals, and Pablo Neira, 26, of New York, pleaded guilty by videoconference this week before U.S. District Judge Stanley R. Chesler to informations charging each of them with one count of conspiracy to transport stolen property across state lines. In addition, Zorilla, Rincon, and Neira also pleaded guilty to conspiracy to commit bank fraud, and Lozada Serna pleaded guilty to illegally re-entering the United States of America after being previously deported for an aggravated felony.

According to documents filed in this case and statements made in court:

From Dec. 14, 2019, through Jan. 14, 2020, Zorilla, Rincon, Neira, and Lozada Serna conspired with each other to burglarize homes in New Jersey, Pennsylvania, and Delaware. The defendants stole money, jewelry, and designer clothing. They were arrested while breaking into a home in Wilmington, Delaware.

Zorilla, Rincon, and Neira obtained fraudulent foreign travel documents under fictitious names to gain access to United States banks. They used fraudulently obtained financial devices to rent vehicles and hotel rooms used in furtherance of the commission of these home burglaries.  Lozada Serna illegally re-entered the United States after his removal in 2019 after he was previously convicted of an aggravated felony in Texas.

The charge of conspiracy to transport stolen property carries a maximum penalty of five years in prison, and a maximum fine of $250,000. The charge of conspiracy to commit bank fraud carries a maximum penalty of 30 years in prison and a maximum fine of $1 million. The charge for illegally re-entering the United States carries a maximum penalty of 20 years in prison and a maximum fine of $250,000. Sentencing for all four defendants is scheduled for July 13, 2021.

Acting U.S. Attorney Honig credited the FBI, under the direction of George M. Crouch Jr. in Newark, with the investigation leading to the guilty pleas. She also thanked special agents of the FBI Baltimore Division, Wilmington Resident Agency and Delaware Violent Crimes Task Force; the FBI New York Office, Joint Terrorism Task Force, John F. Kennedy Airport Resident Agency; Immigration and Customs Enforcement – Enforcement and Removal Operations, Newark; the New Castle County Delaware Police Department, and the Beachwood New Jersey Police Department, for their work on the case.

The government is represented by Special Assistant U.S. Attorney Keith Travers of the U.S. Attorney’s Office OCDETF/Narcotics Unit in Newark.