District of New Jersey

NEWARK, N.J. – A Mexican national today admitted transporting approximately two kilograms of fentanyl into New Jersey for distribution, U.S. Attorney Craig Carpenito announced.

Adrian Vargas Arroyo, 31, pleaded guilty by videoconference before U.S. District Judge Brian R. Martinotti to an indictment charging him with one count of possession with intent to distribute over 400 grams of fentanyl.

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

In October 2019, Vargas Arroyo drove a tractor trailer into New Jersey with a bag containing four half-kilogram packages of fentanyl, weighing a total of approximately two kilograms. Vargas Arroyo arranged to distribute the narcotics at a location in Middlesex County, New Jersey, where he was arrested.

The distribution and possession with intent to distribute charge to which Vargas Arroyo pleaded guilty carries a mandatory minimum penalty of 10 years in prison, a maximum of life in prison, and a $10 million fine. Sentencing is scheduled for March 29, 2021.

U.S. Attorney Carpenito credited special agents with 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. Attorney Shawn Barnes of the U.S. Attorney’s Office Organized Crime Drug Enforcement Task Force/Narcotics Unit.

TRENTON, N.J. – An Atlantic County, New Jersey, man is scheduled to make his initial appearance today after being charged with possessing and distributing images of child sexual abuse, U.S. Attorney Craig Carpenito announced.

Stephen Tisch, 36, of Minotola, New Jersey, is charged by indictment with one count of distribution of child pornography and one count of possession of child pornography. He was arrested by FBI agents today and is expected to appear by videoconference today before U.S. Magistrate Judge Lois H. Goodman.

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

A law enforcement investigation revealed that Tisch, living in Ocean County at the time, and who previously had been convicted of child pornography offenses, had distributed images of child sexual abuse over an online social media chat forum. A search of Tisch’s residence found multiple images depicting the sexual exploitation of children on Tisch’s mobile phone.

Tisch was previously convicted of endangering the welfare of a child/possession of child pornography in Ocean County in 2014. The charge of possession of child pornography, for a repeat offender, carries a mandatory minimum of 10 years in prison, a maximum of 20 years in prison, and a $250,000 fine. The charge of distribution of child pornography, for a repeat offender, carries a mandatory minimum of 15 years in prison, a maximum of 40 years in prison, and a $250,000 fine.

U.S. Attorney Craig Carpenito credited special agents with FBI, under the direction of Special Agent in Charge George M. Crouch Jr., New Jersey Regional Forensics Computer Laboratory, under the direction of Supervisory Special Agent Steven J. Newman, and the Ocean County Prosecutor’s Office, under the direction of Prosecutor Bradley D. Billhimer, with the investigation leading to today’s charges.

The government is represented by Assistant U.S. Attorney Michelle S. Gasparian 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 against the defendant are merely accusations and he is presumed innocent unless and until proven guilty.

NEWARK, N.J. – An Essex County, New Jersey, man who is a previously convicted felon was sentenced today to 75 months in prison for possessing a firearm and ammunition in connection with an incident in which he shot another individual, U.S. Attorney Craig Carpenito announced.

Andre Shoulars, 28, of Newark, previously pleaded guilty before U.S. District Judge Esther Salas to an indictment charging him with one count of possession of a firearm and ammunition by a convicted felon. U.S. District Judge Brian R. Martinotti imposed the sentence by videoconference today.

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

On Nov. 4, 2018, at approximately 2:30 p.m., the victim was in the area of 340 Hawthorne Avenue in Newark, speaking with another individual. Shoulars approached the victim, pulled out a semiautomatic handgun, and began firing several shots at the victim. Although the victim was able to run away as Shoulars fired the handgun, the victim was hit in the foot with one .40 caliber bullet fired by Shoulars. The victim was treated at a hospital for the bullet wound. 

Newark police officers responded to the scene of the shooting and recovered five .40 caliber shell casings from the street. Officers also recovered videotapes from several surveillance cameras which were stationed in the area of the shooting. These videotapes showed Shoulars walking around in the area just before the shooting, and also showed Shoulars shooting at the victim and then running away.     

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

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 .

U.S. Attorney Carpenito credited the U.S. Marshals Service, under the direction of U.S. Marshal Juan Mattos Jr., and the Newark Police Department, under the direction of Public Safety Director Anthony F. Ambrose, with the investigation leading to today’s guilty plea.

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

NEWARK, N.J. – The owner of a group of related durable medical equipment (DME) companies today admitted his role in a conspiracy to pay kickbacks in exchange for durable medical equipment, Attorney for the United States Rachael A. Honig announced.

Albert Davydov, 28, of Rego Park, New York, pleaded guilty by videoconference before U.S. District Judge Kevin McNulty to an indictment charging him with conspiring to violate the Anti-Kickback statute.

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

Davydov, the owner of nine DME companies, participated in a scheme to pay kickbacks in exchange for doctors’ orders for medically unnecessary orthotic braces. Once Davydov and his conspirators received the completed doctor’s orders, they billed Medicare and other federal and private health care benefit programs for the braces. Davydov concealed his ownership of the DME companies by falsely reporting to Medicare that various straw owners owned the companies. 

As part of his plea agreement, Davydov agreed that the improper benefit conferred was over $16 million for the charged conspiracy to violate the federal Anti-Kickback statute. The conspiracy charge to which Davydov 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, whichever is greatest. Sentencing is scheduled for March 25, 2021.

Attorney for the United States Honig credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark; the Department of Health and Human Services-Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert; and the U.S. Department of Veterans Affairs Office of Inspector General, under the direction of Special Agent in Charge Christopher F. Algieri with the investigation leading to today’s plea.

The government is represented by Assistant U.S. Attorney J. Stephen Ferketic of the Opioid Abuse Prevention & Enforcement Unit.

NEWARK, N.J. – Attorney General William P. Barr has announced the recipients for the 68th Annual Attorney General’s Awards, recognizing Department of Justice employees and partners for extraordinary contributions to the enforcement of our nation’s laws.

Among the honorees this year is Assistant U.S. Attorney Mary E. Toscano, Deputy Chief of the Criminal Division for the U.S. Attorney’s Office-District of New Jersey (USAO-DNJ). AUSA Toscano is one of 240 DOJ employees who received awards, while 27 non-department individuals are also being honored for their work. This year, due to coronavirus restrictions, Attorney General Barr is honoring recipients virtually.

“I am honored to recognize the recipients of this year’s Attorney General’s Awards, whose tireless work and steadfast dedication have proven critical to enforcing the rule of law and protecting all Americans,” Attorney General Barr said. “Those honored today have demonstrated exceptional efforts and made tremendous personal sacrifices throughout their time working at the Department of Justice, and for that, I am truly thankful.”

AUSA Toscano was one of two winners of the Attorney General’s Award for Excellence in Management, which recognizes outstanding administrative or managerial achievements that have significantly improved operations, productivity, or reduced costs.

In August 2017, the USAO-DNJ initiated a Violent Crime Initiative for the City of Newark in light of a serious and still-developing violent crime problem. AUSA Toscano, then the Chief of the Organized Crime/Gangs Unit, was assigned to get the VCI off the ground and manage and supervise it. She rapidly put together a federal, state and local partnership led by herself; the Essex County Prosecutor’s Office; Newark’s Department of Public Safety; and the FBI, Bureau of Alcohol, Tobacco, Firearms and Explosives, and Drug Enforcement Administration, with the goal of combatting violent crime in and around Newark. As part of this partnership, federal, state, county, and city agencies collaborate, share intelligence, and pool resources to prosecute violent offenders who endanger the safety of the community. 

AUSA Toscano has led the Newark VCI for over three years, during which Newark has seen a sharp decrease in overall crime and violent crime. Between 2017 and 2018, Newark saw a 30 percent reduction in the number of shooting victim. In 2019, the number of shooting victims and shooting incidents declined another 39 percent compared to 2018. In that same year, the number of murders in Newark reached its lowest level in nearly six decades.

“These successes simply would not have been possible without Ms. Toscano’s close management and careful direction,” U.S. Attorney Craig Carpenito said. “The Newark VCI has not only improved community safety, but has strengthened the relationships among federal, state, county and city agencies. As a result of the trust developed among the participants, the Newark VCI has enjoyed not only success with respect to reducing violence, but also in improving relationships among the various stakeholders. Ms. Toscano’s management is key to this success as well.”

For her work on the Newark VCI, AUSA Toscano was honored in October 2019 with a Proclamation from the City of Newark, recognizing her considerable contributions to public safety in Newark. Mayor Ras Baraka’s proclamation stated that the VCI “has had a dramatic impact on crime in Newark,” and credited AUSA Toscano for her work “to make Newark a safer, more empowered, and more equitable City.”

In 2018, U.S. Attorney Carpenito asked Ms. Toscano to stand up a second VCI, this one focusing on Jersey City, New Jersey, which operates in much the same fashion. Ms. Toscano has managed and supervised both VCIs concurrently for over a year – in addition to her other duties as Deputy Chief of the Criminal Division. The results in Jersey City have been equally dramatic.  Violent crime was down 30 percent in Jersey City in 2019, compared to 2018. The goal of the Mayor of Jersey City entering 2019 had been to obtain a 10 percent reduction; the VCI helped far exceed this goal.

AUSA Toscano has been a key advisor in helping her colleagues to establish more recent VCIs in Trenton, Camden, and Paterson, New Jersey. She has trained local police departments in these cities on the operation of the VCI model and has been invaluable as a resource to the AUSAs who are getting these VCIs off the ground.  Her management has been critical to the USAO-DNJ’s efforts to combat violent crime across the entire State of New Jersey.

AUSA Toscano joined the DOJ in 2007 through the DOJ Honors Program, as a Trial Attorney in the Narcotics & Dangerous Drugs Section. She first joined the USAO-DNJ as a Special Assistant U.S. Attorney, before being hired as an AUSA in 2012. She was promoted to Deputy Chief of the General Crimes Unit in 2015; became the Chief of that Unit in 2016; and later became the Chief of the OC/Gangs Unit. She has served as Deputy Chief of the Criminal Division since March 2018. In that capacity, she supervises the OCDETF/Narcotics, OC/Gangs, and Violent Crimes Units, in addition to managing the VCIs in Newark and Jersey City.

The year 2020 marks the 150th anniversary of the Department of Justice.  Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.

NEWARK, N.J. – An Essex County, New Jersey, man today admitted robbing five banks between October 2018 and January 2019, U.S. Attorney Craig Carpenito announced.

Myron Anderson, 40, of Newark, pleaded guilty before U.S. District Judge Kevin McNulty in Newark federal court to a superseding information charging him with five counts of bank robbery and two counts of Hobbs Act robbery.

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

Anderson admitted robbing the following banks:

 

Bank

Location

Date

Bank of America

Florham Park, New Jersey

Oct. 1, 2018

TD Bank

Hackensack, New Jersey

Nov. 13, 2018

Provident Bank

Bridgewater, New Jersey

Nov. 14, 2018

Chase Bank

Nanuet, New York

Nov. 15, 2018

TD Bank

Franklin, New Jersey

Jan. 14, 2019

In each of the bank robberies, Anderson walked into the banks with a hat pulled down closely over his eyes to shield his face from view and presented the teller with a note demanding money be placed in an envelope. Anderson intimidated the tellers, who, fearing for their safety, complied and handed Anderson money. In each instance, Anderson took evasive actions in travelling to and from the banks so as not to get caught. 

Each count of bank robbery in which Anderson is charged carries a maximum punishment of 20 years in prison and a $250,000 fine. Sentencing is scheduled for March 25, 2021.

U.S. Attorney Carpenito 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. He also thanked the Florham Park, Hackensack, Bridgewater, and Franklin police departments in New Jersey and the Clarkstown, New York, police department. 

The government is represented by Assistant U.S. Attorney Robert Scrivo of the Criminal Division of the U.S. Attorney’s Office in Newark.

TRENTON, N.J. – A Michigan man today admitted his role in a large-scale conspiracy to commit bank fraud in several states, including New Jersey, New York, Pennsylvania, Maryland, Virginia, and Michigan, over the course of two years, U.S. Attorney Craig Carpenito announced today.

Rana Sharif, 36, of Dearborn Heights, Michigan, pleaded guilty by videoconference before Chief U.S. District Judge Freda L. Wolfson to an information charging him with one count of conspiracy to commit bank fraud.

On Nov. 10, 2020, co-defendant Ali Abbas, 38, of Middlesex County, New Jersey, pleaded guilty by videoconference before Judge Wolfson to a separate information that also charged him with conspiracy to commit bank fraud.

Sharif, Abbas and five co-defendants – Awaise Dar, Shamsher Farooq, Naveed Arif, Habib Majid and Erm Ayaz – were charged by complaint in July 2020 in connection with the scheme.

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

From 2018 through April 2020, Sharif, Abbas, and others conspired to defraud several major banks and electronic merchant processors. They established bank accounts associated with sham entities that had no legitimate purpose, and issued checks payable to other shell companies associated with the criminal organization, knowing that the payor accounts had insufficient funds. The conspirators would also conduct fraudulent credit card and debit card transactions between shell companies to credit payee accounts and overdraw payor accounts. The defendants also used these shell companies to execute temporary refund credits, commonly referred to as “charge-backs,” to checking accounts associated with the criminal organization, where no prior legitimate transaction had occurred. 

Members of the criminal organization withdrew the “existing” funds (through ATMs or bank tellers) that banks and merchant processors had credited to the payee bank accounts at the time of the fraudulent transaction. Because the conspirators withdrew the credited funds from the payee accounts before the banks could recognize the fraudulent transactions, the banks and merchant processors were left with substantial losses.

During its investigation, law enforcement identified approximately 200 bank accounts and 75 merchant credit card processing accounts used to facilitate the conspiracy’s fraudulent schemes. Sharif, Ali, and other conspirators’ unlawful activities attempted to cause a $10 million loss on financial institutions and did in fact caused a loss of approximately $3.5 million.

The conspiracy charges to which Sharif and Abbas pleaded guilty carry a maximum potential penalty of 30 years in prison, a fine of $1 million or twice the gross pecuniary gain to the defendants or twice the gross pecuniary loss to others, whichever is greater. Sharif’s sentencing is scheduled for March 15, 2021. Abbas’ sentencing is scheduled for March 18, 2021.

 U.S. Attorney Craig Carpenito credited special agents of the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Raimundo Marrero in Newark; the U.S. Department of Homeland Security, Homeland Security Investigations, under the direction of Special Agent in Charge Jason J. Molina in Newark: Social Security Administration, under the direction of John F. Grasso; and special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Michael Montanez, with the investigation leading to the guilty pleas.

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

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

CAMDEN, N.J. – A member of a Camden drug-trafficking organization today admitted conspiring to distribute heroin, U.S. Attorney Craig Carpenito announced.

Jose Agron, 26, of Camden, pleaded guilty by videoconference before U.S. District Judge Renée Marie Bumb to an information charging him with one count of conspiracy to distribute and possess with intent to distribute at least one kilogram of heroin.

Fourteen other members of the drug-trafficking conspiracy based in the 500 block of Pine Street in Camden – Ronnie Lopez, Nelson Salcedo, Carlos Perez, Paul Salcedo, Waldemar Garcia, William Carrillo, Elisa Rivera, Ramon Velez, David Velez, Naeem Sadler, Jasmin Velez, Jameel Byng, Kaliel Johnson, and Meylin Troncoso – previously have pleaded guilty in this case. The charges against three other defendants remain pending.

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

An investigation by led by the FBI used surveillance tactics, confidential informants, consensual recordings, over 40 controlled drug purchases, record checks, a GPS vehicle tracker, and several court-authorized wiretaps to uncover the operations of the Camden drug-trafficking organization. Members of the drug-trafficking organization sold heroin, crack cocaine, cocaine, and fentanyl in and around Camden.

The count to which Agron pleaded guilty carries a mandatory penalty of 10 years in prison, a maximum potential penalty of a lifetime in prison, and a $10 million fine. Sentencing is scheduled for March 15, 2021.

U.S. Attorney Carpenito credited special agents of the FBI’s South Jersey Violent Offender and Gang Task Force, South Jersey Resident Agency, under the direction of Special Agent in Charge Michael J. Driscoll in Philadelphia; the Camden County Police Department, under the direction of Chief Joseph Wysocki; the Camden County Prosecutor’s Office, under the direction of Acting Prosecutor Jill S. Mayer; the Camden County Sheriff’s Department, under the direction of Sheriff Gilbert L. Wilson; the Cherry Hill Police Department, under the direction of Chief William P. Monaghan; and the N.J. State Police, under the direction of Col. Patrick J. Callahan, with the investigation leading to today’s guilty plea. He also thanked the Drug Enforcement Administration, the U.S. Marshals Service, and the Department of Homeland Security for their assistance.

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.

The government is represented by Assistant U.S. Attorneys Sara A. Aliabadi and Patrick C. Askin of the U.S. Attorney’s Office Criminal Division in Camden.

For the defendants whose charges remain pending, the charges and allegations are merely accusations, and they are presumed innocent unless and until proven guilty.

NEWARK, N.J. – A New York man today admitted to knowingly distributing and selling to individuals throughout the United States an unregistered pesticide imported from Nigeria, U.S Attorney Craig Carpenito, announced.

Jude Chukwuebuka Amadike, 62, of Elmont, New York, pleaded guilty before U.S. Magistrate Judge Joseph A. Dickson in Newark federal court to an information charging him with one count of knowingly distributing or selling an unregistered pesticide in violation of the Federal Insecticide, Fungicide and Rodenticide Act (FIFRA).

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

FIFRA provides for federal regulation of pesticide distribution, sale, and use to ensure that pesticides sold in the United States are safe, effective, and bear labeling containing true and accurate information. The Environmental Protection Agency (EPA) has responsibility under FIFRA to regulate the manufacture, labeling, and distribution of all pesticides shipped or received in interstate commerce. All pesticides must be registered with the EPA before the pesticide can be sold or distributed, and no person may distribute or sell a pesticide that has not been registered with the EPA. 

From Sept. 15, 2016, through Nov. 14, 2018, Amadike sold an unregistered pesticide called Sniper DDVP on Amazon and eBay to customers in at least 22 states, including New Jersey. The investigation into these sales revealed that the defendant procured this pesticide by importing it from a Nigerian supplier. One such purchase in December 2017 revealed an import of approximately 798 pounds of Sniper DDVP. 

On Nov.14, 2018, law enforcement executed a search warrant at the Amadike’s home and recovered 1,728 bottles of the unregistered pesticide. Laboratory testing of samples taken from these bottles revealed each sampled bottle to contain the chemical dichlorvos, which has been classified by EPA as a probable human carcinogen.

The illegal sale of an unregistered pesticide carries a statutory maximum prison sentence of one year and a fine of up to $25,000. Sentencing is scheduled for March 16, 2021.  

U.S. Attorney Carpenito credited special agents of the U.S. Environmental Protection Agency, Criminal Investigation Division, under the direction of Special Agent in Charge Tyler C. Amon; special agents of the U.S. Department of Homeland Security, Homeland Security Investigations, New Jersey Division, under the direction of Special Agent in Charge Jason J. Molina; and officers of U.S. Customs and Border Protection, under the direction of Troy Miller, Director of Field Operations, New York Field Office, with the investigation leading to today’s guilty plea.

The government is represented by Special Assistant U.S. Attorney Jason P. Garelick of the U.S. Attorney's Government Fraud Unit in Newark.

NEWARK, N.J. – An Essex County, New Jersey man appeared before a federal judge today on charges that he produced and possessed images of child sexual abuse, U.S. Attorney Craig Carpenito announced.

Antonio Del Prado, 59, of Millburn, New Jersey, is charged by complaint with one count of production of child pornography and two counts of possession of child pornography. He appeared by videoconference before U.S. Magistrate Judge Edward S. Kiel and was detained without bail.

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

In October 2020, law enforcement learned that Del Prado had uploaded 56 images and 18 videos of suspected child sexual abuse to an internet-based cloud storage system. Del Prado had actively participated in the production of child sexual abuse by giving instructions to another individual who was live-streaming a video of themselves sexually assaulting a child. Law enforcement arrested Del Prado at his residence in Millburn this morning.

The charge of production of child pornography carries a mandatory minimum penalty of 15 years in prison, a maximum penalty of 30 years in prison, and fine of $250,000. The charge of possession of child pornography carries a maximum penalty of 10 years in prison, and fine of $250,000.

U.S. Attorney Carpenito credited special agents with 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 the charges.

The government is represented by Assistant U.S. Attorney Shawn Barnes of the U.S. Attorney’s Organized Crime/Drug Enforcement Task Force Unit in Newark.

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

TRENTON, N.J. – A Pennsylvania woman today admitted participating in a conspiracy to receive bribes and kickbacks in exchange for ordering genetic tests, U.S. Attorney Craig Carpenito announced.

Kimberly Schmidt, 46, of Moscow, Pennsylvania, pleaded guilty by videoconference before U.S. District Judge Anne E. Thompson to an information charging her with one count of conspiring to violate the anti-kickback statute.

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

Schmidt worked for Lee Besen, a primary care physician with a medical office in Peckville, Pennsylvania. From December 2018, Besen and Schmidt accepted monthly cash kickbacks and bribes in exchange for collecting DNA samples from Medicare patients and sending them for genetic tests to clinical laboratories in New Jersey and Pennsylvania. The cash kickbacks typically ranged from $500 to $1,500, and Besen typically accepted the cash inside his medical office.

When Besen did not receive his kickback and bribe payments, the volume of genetic tests he ordered dipped. But when those payments flowed to Besen, he increased that volume because, as Besen said in a recorded conversation, “Greenbacks speak.” Besen enlisted Schmidt to help him with the scheme by preparing paperwork for the genetic tests. In turn, Schmidt received kickbacks and bribes that were calculated based on the volume of genetic tests that Besen generated.

Even as the ongoing COVID-19 pandemic substantially reduced in-patient visits, Besen continued participating in the scheme because, as he was recorded saying, he wanted “greenbacks” to pay for his “pool house.”

As a result of the scheme, Medicare paid approximately $350,374 for genetic tests generated from Besen’s medical practice.

Conspiracy to violate the federal anti-kickback statute is punishable by a maximum of five years in prison and a fine of $250,000, or twice the gross gain or loss derived from the offense, whichever is greater. Sentencing is scheduled for March 16, 2021.

U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark; IRS-Criminal Investigation, under the direction of Special Agent in Charge Michael Montanez in Newark; and U.S. Department of Health and Human Services, Office of Inspector General, Philadelphia Regional Office, under the direction of Special Agent in Charge Maureen Dixon, with the investigation leading to the charges. He also thanked the FBI Scranton Field Office, FBI Philadelphia Division, and the Pennsylvania Attorney General’s Office for their assistance.

The government is represented by Assistant U.S. Attorney Joshua L. Haber of the Health Care Fraud Unit and Executive Assistant U.S. Attorney Rahul Agarwal.

The charges against and allegations in the information pertaining to Besen are merely accusations, and he is presumed innocent unless and until proven guilty.

NEWARK, N.J. – A Bergen County, New Jersey, man was sentenced today to 120 months in prison for conspiring to launder more than $850,000, which he believed was derived from the sale of narcotics, U.S. Attorney Craig Carpenito announced.

Bobbie L. Henderson III, 36, previously pleaded guilty before U.S. District Judge Stanley R. Chesler in Newark federal court to an information charging him with one count of conspiracy to launder monetary instruments. Judge Chesler imposed the sentence today by videoconference.

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

From 2017 through May 23, 2019, Henderson conspired with others to launder the proceeds of narcotics distribution, with the intent to promote the distribution of narcotics. Henderson further admitted to possessing more than $850,000 in furtherance of this conspiracy. These funds were seized by law enforcement during the course of the investigation.

In addition to the prison term, Judge Chesler sentenced Henderson to three years of supervised release, fined him $20,000 and ordered forfeiture of $853,120.

U.S. Attorney Carpenito credited special agents and task force officers with the Drug Enforcement Administration, under the direction of Special Agent in Charge Raymond Donovan in New York, with the investigation leading to today’s sentencing.

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

CAMDEN, N.J. – A South Jersey doctor was charged in connection with his role in a longstanding billing fraud scheme, U.S. Attorney Craig Carpenito announced today.

Morris Antebi, 68, of Long Branch, New Jersey, is charged by complaint with three counts of health care fraud, wire fraud, and mail fraud for his role in the scheme. Antebi is scheduled to appear today by videoconference before U.S. Magistrate Judge Joel Schneider.

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

Antebi, a physician specializing in pain management and anesthesia, owned and operated a pain management clinic chain with locations throughout South Jersey. Antebi was a participating provider in Medicare, Medicaid, and several private insurance plans. Between approximately 2014 through 2020, Antebi billed over $24.6 million for services he purportedly provided, including billing more than $15.3 million to Medicaid and more than $8 million to Medicare. 

The investigation showed that Antebi engaged in various forms of billing fraud. For example, Antebi frequently billed Medicare, Medicaid, and private insurance companies on dates when travel records show he was overseas, including on trips to China, Israel, Turkey, the Dominican Republic, and across Europe, or when he was otherwise outside the State of New Jersey. Antebi billed approximately $230,700 to Medicaid, Medicare, and private insurance plans between November 2015 and January 2020 for services he purportedly rendered while he was traveling and not in the office. 

The investigation also showed that Antebi billed for excessive billings for one-day periods of time. For example, Antebi billed insurance plans for more than 24 hours’ worth of services in a one-day period of time on more than 900 occasions between 2014 and 2020.  Antebi also billed insurance companies for between 12 and 23.99 hours of purported services in a one-day period of time on more than 300 occasions. On certain occasions, law enforcement surveilled Antebi on days when he left the clinics early, but nevertheless billed as though he saw many patients on those days.

Despite these high billings, individuals interviewed during the investigation stated that Antebi commonly saw them for only very brief periods of time, and he often did not perform any medical exams or evaluations during their visits. Individuals also indicated that that there sometimes was no medical equipment or examination tables in the rooms at the clinics in which patients met with providers, and that patients sometimes met with providers on folding chairs in the hallway of the clinics.

The health care fraud count carries a maximum penalty of 10 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense.  The wire fraud and mail fraud counts each carry a maximum penalty of 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. 

U.S. Attorney Carpenito credited agents of the FBI’s Atlantic City Resident Agency Health Care Fraud Task Force, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark; the U.S. Department of Health and Human Services – Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert, the U.S. Department of Labor – Office of Inspector General, New York Region, under the direction of Special Agent in Charge Michael C. Mikulka, the U.S. Drug Enforcement Administration, under the direction of Special Agent in Charge Susan A. Gibson in Newark, and IRS-Criminal Investigation, under the direction of Special Agent in Charge Michael Montanez in Newark with the investigation leading to the criminal complaint. U.S. Attorney Carpenito also thanked agents of FBI’s Headquarters Health Care Fraud Unit Data Analysis Response Team under the direction of Special Agent Greg Heeb in Washington, D.C. and officers of the Northfield Police Department for their assistance with the case.

The government is represented by Assistant U.S. Attorneys Christina O. Hud and Daniel A. Friedman of the U.S. Attorney’s Office in Camden.

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

Defense counsel: TBD

NEWARK, N.J. – An Essex County, New Jersey, man was sentenced today to 80 months in prison for three felony charges in connection with his possession of firearms and ammunition on three different days in April and May of 2019, U.S. Attorney Craig Carpenito announced.

Samaad Kelly, a/k/a “Spud,” 33, previously pleaded guilty before U.S. District Judge Esther Salas in Newark federal court to an information charging him with two counts of being a felon in possession of a firearm and one count of being a felon in possession of ammunition. U.S. District Judge Brian R. Martinotti imposed the sentence today by videoconference.

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

On April 24, 2019, officers from the Essex County Sheriff’s Office received information that Kelly was driving in Newark in a silver BMW with a temporary registration and was in possession of a firearm. The officers observed the BMW, which had a fictitious registration, and conducted a stop. Kelly, who was driving the BMW, could not provide the officers with any identification, registration, or proof of insurance. After conducting a search of the BMW, the officers located a Taurus semi-automatic 9 millimeter handgun in the glove box. The officers arrested Kelly, and Kelly remained in custody until May 2, 2019, when he was released on bail.

On May 7, 2019, officers from the Newark Police Department responded to a report of gun shots near Astor Street in Newark. Upon their arrival, they found one 9 millimeter discharged shell casing and one 9 millimeter round of live ammunition. The officers obtained video footage from surveillance cameras located nearby, which showed Kelly point and fire a black handgun in the direction of another individual.

On May 10, 2019, detectives from the Newark Police Department were patrolling a section of Newark in the vicinity of Astor and Brunswick streets. One of the detectives observed Kelly wearing a fanny pack that appeared to be heavily weighed down. When the detectives approached Kelly, he fled on foot. While running away from the detectives, Kelly unclipped the fanny pack and attempted to throw it over a fence. As he was throwing the fanny pack, he slipped and fell to the ground. The detectives apprehended Kelly, recovered the fanny pack, and found inside of it a Ruger 9 millimeter semi-automatic pistol, loaded with 10 rounds of ammunition. The detectives arrested Kelly.

In addition to the prison term, Judge Martinotti sentenced Kelly to 3 years of supervised release.

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 NCIS 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 .

U.S. Attorney Carpenito credited special agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Charlie J. Patterson, Newark Field Division, with the investigation leading to today’s sentencing. He also thanked the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Theodore N. Stephens II, police officers and detectives of the Newark Police Department, under the direction of Public Safety Director Anthony F. Ambrose, and the Essex County Sheriff’s Office, under the direction of Sheriff Armando B. Fontoura, for their work on the case.

The government is represented by Assistant U.S. Attorney Christopher D. Amore of the Government Fraud Unit in Newark.

Defense counsel: Lisa M. Mack Esq., Assistant Federal Public Defender, Newark

NEWARK, N.J. –A Bergen County, New Jersey, man was sentenced today to 84 months in prison for his role in a scheme to transport more than 20 kilograms of cocaine from California to New Jersey, U.S. Attorney Craig Carpenito announced.

Irving Olivero-Pena, 48, a/k/a “Fausto Molina,” of Edgewater, New Jersey, previously pleaded guilty before U.S. District Judge Kevin McNulty to Count One of an indictment charging him with conspiracy to possess with the intent to distribute five kilograms or more of cocaine. Judge McNulty imposed the sentence by videoconference today.

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

Olivero-Pena and co-defendants Melvin Feliz, 54, of Englewood Cliffs, New Jersey, and Robert Crawford, 45, of Long Island City, New York, each previously pleaded guilty to their roles in the scheme. They admitted that from January 2011 through March 2014, they conspired to purchase narcotics for distribution in New Jersey. On Oct. 22, 2012, they met a courier in Bergen County. They admitted that they gave the courier $549,950 in currency to transport to California via tractor trailer, where it would be used to purchase approximately 20 kilograms of cocaine. Afterwards, the courier would transport the cocaine to New Jersey for distribution. The currency was ultimately seized by law enforcement officers in California.

In addition to the prison term, Judge McNulty sentenced Olivero-Pena to 5 years of supervised release. Feliz was sentenced on Nov. 6, 2020, to 14 years in prison. Crawford was sentenced in July 2015 to 10 years in prison.

U.S. Attorney Carpenito credited special agents from the U.S. Drug Enforcement Administration (DEA), Newark Division, under direction of Special Agent in Charge Susan A. Gibson; and special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Michael Montanez in Newark, with the investigation leading to today’s sentencing.

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

Defense counsel: Olivero-Pena: David Touger Esq., New York
Feliz: Patrick Joyce Esq., New York
Crawford: Rubin Sinins Esq., Springfield, New Jersey

NEWARK, N.J. – A Bergen County, New Jersey, man was sentenced today to 168 months in prison for using bogus litigation support companies to obtain millions from two law firms where his wife was a partner and for his role in a scheme to transport more than 20 kilograms of cocaine from California to New Jersey, U.S. Attorney Craig Carpenito announced.

Melvin Feliz, 54, of Englewood Cliffs, New Jersey, previously pleaded guilty before U.S. District Judge Kevin McNulty to an information charging him with one count of conspiracy to commit wire fraud and one count of tax evasion. He also previously pleaded guilty to Count One of an indictment charging him and two co-defendants with conspiracy to possess with the intent to distribute five kilograms or more of cocaine. Judge McNulty imposed the sentence today in Newark federal court.

According to documents filed in these cases and statements made in court:

Feliz’s wife, Keila Ravelo, 55, also of Englewood Cliffs, worked as a partner at Law Firm 1 from July 1, 2005, through October 2010. She then joined Law Firm 2 as a partner and worked there from October 2010 through November 2014. Feliz admitted that during that time, Feliz and Ravelo formed two limited liability companies, Vendor 1 and Vendor 2, that purported to provide litigation support for both firms, but in fact provided no actual services.       

Feliz admitted that from 2008 through July 2014, he and Ravelo controlled the Vendor 1 and Vendor 2 bank accounts and submitted invoices to Law Firm 1, Law Firm 2 and a client of both firms for work that was never performed. Ravelo, in her capacity as a partner at the law firms, approved payments to Vendor 1 and Vendor 2 that Ravelo and Feliz later used for personal expenses.  

Over the course of the conspiracy, the law firms paid Vendor 1 and Vendor 2 approximately $7.8 million. Feliz admitted that he failed to report the income on his tax returns, including $2.36 million in illicit profits from 2012 alone.

Separately, Feliz and co-defendants Irving Olivero-Pena, 48, of Edgewater, New Jersey, and Robert Crawford, 45, of Long Island City, New York, each previously pleaded guilty to their roles in a cocaine distribution scheme. They admitted that from January 2011 through March 2014, they conspired to purchase narcotics for distribution in New Jersey. On Oct. 22, 2012, they met a courier in Bergen County. They admitted that they gave the courier $549,950 in currency to transport to California via tractor trailer, where it would be used to purchase approximately 20 kilograms of cocaine. Afterwards, the courier would transport the cocaine to New Jersey for distribution. The currency was ultimately seized by law enforcement officers in California.

In addition to the prison term, Judge McNulty sentenced Feliz to five years of supervised release and ordered forfeiture of $7.9 million. Restitution will be determined at a later date. Ravelo was sentenced in October 2018 to five years in prison. Crawford was sentenced in July 2015 to 10 years in prison. Olivero-Pena is scheduled to be sentenced Nov. 9, 2020.

U.S. Attorney Carpenito credited special agents from the U.S. Drug Enforcement Administration (DEA), Newark Division, under direction of Special Agent in Charge Susan A. Gibson; and special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Michael Montanez in Newark, with the investigation leading to today’s sentencing.

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 owner of a New Jersey-based scrap metal company has been arrested for allegedly orchestrating a scheme to defraud one of his customers, U.S. Attorney Craig Carpenito announced.

Creed White, a/k/a “Dan Stein,” 62, of Freeland, Maryland, is charged by complaint with four counts of wire fraud. White made his initial court appearance today by videoconference before U.S. Magistrate Judge Martin C. Carlson in Harrisburg, Pennsylvania, federal court.

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

In early 2017, White contacted the victim through an internet message board and offered to sell the victim aluminum scrap metal. White introduced himself as “Dan Stein.” White’s company, American Scrap LLC, sold the victim 25 containers of aluminum scrap metal in exchange for wire payments totaling approximately $629,973. The containers were shipped to Korea. When the first container arrived at its destination, the victim discovered that the container contained dirt and debris and no aluminum scrap metal. The victim reached out to White to complain and met him in person in Newark in March 2017. White, posing as “Dan Stein,” assured the victim that he would correct the mistake and reimburse the victim for the costs incurred in connection with the container that contained useless waste.

Prior to shipping the next container, White sent the victim photos of the contents of the container. The photos showed that the container was filled with aluminum scrap. There was a copy of the New York Post inside the container to document the date the photos were taken. However, each of the remaining containers arrived in Korea was filled with dirt, debris or plastic waste, and no aluminum. White promised to make the victim whole and sent wire transfers to the victim in the amount of $15,000, but then failed to make good on his promise, causing the victim losses in excess of $600,000. 

Each count of wire fraud carries a maximum potential penalty of 20 years in prison and a fine of $250,000 or twice the gross gain or loss derived from the offense, whichever is greater.

U.S. Attorney Carpenito 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 these charges.

The government is represented by Assistant U.S. Attorney Sammi Malek of the U.S. Attorney’s Office National Security Unit in Newark.

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

NEWARK, N.J. – A New York man today admitted he defrauded credit card companies of hundreds of thousands of dollars, U.S. Attorney Craig Carpenito announced.

James Olla, 28, of Brooklyn, New York, pleaded guilty by videoconference before U.S. District Judge John Michael Vazquez to one count of a superseding indictment charging him with conspiracy to sell, receive or possess stolen goods.

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 in Brooklyn and elsewhere, often for large sums of cash.

The count of conspiracy to sell, receive or possess stolen goods carries a maximum potential penalty of five years in prison. Sentencing is scheduled for March 18, 2021.

U.S. Attorney Carpenito 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 Raimundo Marrero; and the U.S. Secret Service, under the direction of Special Agent in Charge Mark McKevitt, with the investigation leading to today’s guilty plea.

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.

TRENTON, N.J. – A Hunterdon County, New Jersey, man was sentenced today to 120 months in prison for possession of cocaine with intent to distribute and conspiring to distribute five kilograms or more of cocaine, U.S. Attorney Craig Carpenito announced.

Javier Maldonado, 46, of Hampton, 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 conspiracy to distribute and possess with the intent to distribute five kilograms or more of cocaine and one count of possession with intent to distribute over 500 grams of cocaine. Judge Thompson imposed the sentence by videoconference today.

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

In June 2019, Maldonado agreed with one or more other individuals to purchase 10 kilograms of cocaine. Law enforcement arrested Maldonado after he provided $280,000 to an individual to purchase the narcotics, which he intended to redistribute. A search of Maldonado’s residence revealed a large quantity of bulk cocaine, cutting agents, processing equipment, and packaging materials.

In addition to the prison term, Judge Thompson sentenced Maldonado to five years of supervised release.  

U.S. Attorney Carpenito credited special agents with the U.S. Drug Enforcement Administration, under the direction of Special Agent in Charge Ray Donovan in New York, with the investigation leading to these charges.

The government is represented by Assistant United States Attorney Shawn Barnes of the U.S. Attorney’s Office Organized Crime Drug Enforcement Task Force/Narcotics Unit.

NEWARK, N.J. – A Colorado man today admitted his role in a conspiracy to offer and sell unregistered securities and tax evasion in connection with a $722 million cryptocurrency mining scheme, U.S. Attorney Craig Carpenito announced. 

Jobadiah Sinclair Weeks, 39, of Arvada, Colorado, pleaded guilty by videoconference before U.S. District Judge Claire C. Cecchi to Count Two of an indictment, charging him with conspiracy to offer and sell unregistered securities. Weeks also pleaded guilty to a separate information charging him with tax evasion for the tax years 2015 through 2018.

Weeks and four co-defendants – Matthew Brent Goettsche, Russ Albert Medlin, Catalin Balaci, and Joseph Frank Abel – were charged by indictment in December 2019 in connection with the scheme.

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

From April 2014 through December 2019, the BitClub Network was a fraudulent scheme that solicited money from investors in exchange for shares of purported cryptocurrency mining pools and rewarded investors for recruiting new investors into the scheme. Weeks operated as a large-scale promoter of the BitClub Network, and sold shares despite knowing that the BitClub Network and its operators did not file a registration statement with the U.S. Securities and Exchange Commission.

Weeks admitted taking money from investors in exchange for shares of the BitClub Network’s purported mining pools. He admitted that in order to promote shares, he created and posted videos to the internet and gave presentations and speeches about the BitClub Network throughout the United States and in numerous countries throughout the world. Weeks instructed investors in the United States to use a virtual private network, or “VPN,” to hide their U.S.-based IP addresses and evade detection and regulation by U.S. law enforcement.

Weeks also admitted not filing tax returns and failing to report at least $10 million in income, including cryptocurrency income earned from his association with the BitClub Network, for the tax years 2015 through 2018.

The conspiracy charge to which Weeks pleaded guilty carries a maximum penalty of five years in prison and a fine of $250,000, or twice the pecuniary gain to the defendant or loss to the victims. The tax charge to which Weeks pleaded guilty carries a maximum penalty of five years in prison and a fine of $100,000.  Sentencing is scheduled for March 17, 2021.

U.S. Attorney Carpenito credited special agents and task force officers of the FBI Los Angeles Division’s West Covina Resident Agency, under the direction of Assistant Director in Charge Kristi K. Johnson; special agents of IRS - Criminal Investigation, under the direction of Special Agent in Charge Michael Montanez in Newark and special agents of the IRS Los Angeles Field Office, under the direction of Special Agent in Charge Ryan L. Korner, who conducted this investigation under the initiative of the Joint Chiefs of Global Tax Enforcement; the FBI Criminal Investigative Division, under the supervision of Assistant Director Calvin A. Shivers, and the Financial Crimes Section, under the leadership of Section Chief Steven Merrill; and members of the Ventura Police Department with the investigation leading to today’s guilty plea.

Anyone who believes they may be a victim may visit www.justice.gov/usao-nj/bitclub or the Department of Justice’s large case website www.justice.gov/largecases. Victims can find more information about the case, including a questionnaire for victims to fill out and submit.

The government is represented by Unit Chief David W. Feder, Assistant U.S. Attorneys Jamie L. Hoxie and Anthony P. Torntore of the Cybercrime Unit, and Unit Chief Sarah Devlin and Assistant U.S. Attorney Joseph Minish of the Asset Recovery and Money Laundering Unit, of the U.S. Attorney’s Office in Newark.

NEWARK, N.J. –U.S. Attorney Craig Carpenito today announced more than $2.9 million in Department of Justice grants to fight and prevent violent crime in the District of New Jersey. The grants, awarded by the Department’s Office of Justice Programs, are part of more than $458 million in funding to support state, local and tribal law enforcement efforts to combat violent crime in jurisdictions across the United States.

“One of the fundamental missions of government is to protect its citizens and safeguard the rule of law,” said Attorney General William P. Barr. “The Department of Justice will continue to meet this critical responsibility by doing everything within its power to help our state, local and tribal law enforcement and criminal justice partners fight crime and deliver justice on behalf of all Americans.”

“Combatting violent crime has been a top priority of our office,” U.S. Attorney Carpenito said. “It’s a job that requires resources and cooperation among all levels of law enforcement. We have worked incredibly hard to develop strategies that allow us to combine the efforts of our local, state and federal partners to keep our citizens safe. The grants announced today will provide us with additional tools in that effort.”

The funding announced today continues the Justice Department’s commitment to reducing crime and improving public safety. Recent data from the FBI and the Bureau of Justice Statistics for 2019 show a drop in crime and serious victimization for the third year in a row. However, a number of cities are experiencing conspicuous countertrends. Today’s grants will bolster crime-fighting efforts in those communities and in jurisdictions throughout the United States.

“Violence has become a tragic reality in too many of America’s communities,” OJP Principal Deputy Assistant Attorney General Katharine T. Sullivan said. “Working with officials across the Trump Administration and with thousands of state, local and tribal crime-fighters across the country, the Department of Justice is leading the response to this urgent challenge. OJP is pleased to make these resources available to support innovative, tested and diverse solutions to violent crime.”

Of the more than $458 million awarded nationwide, OJP’s Bureau of Justice Assistance (BJA) made 1,094 grants totaling more than $369 million to support a broad range of initiatives, including efforts in enforcement, prosecution, adjudication, detention and rehabilitation.

OJP’s Office of Juvenile Justice and Delinquency Prevention awarded more than $10 million across 24 jurisdictions to intervene in and suppress youth gang activity as well as $1 million to the Institute for Intergovernmental Research to continue operating the National Gang Center. OJP’s National Institute of Justice awarded $7.8 million to fund research and evaluation on the prevention and reduction of violent crime. OJP’s Bureau of Justice Statistics provided more than $69 million to strengthen the quality and accessibility of records within the National Instant Criminal Background Check System.

The following organizations received funding:

BJA Community-Based Crime Reduction

CBCR leverages community knowledge and expertise to focus enforcement efforts on

crime “hot spots” ‒ neighborhoods where crime is concentrated. To generate long-term impacts, the program addresses a range of challenges.

• Newark Community Street Team, $915,000

 

BJA Strategies for Policing Innovation

Through SPI, BJA works with state and local law enforcement agencies and researchers to identify innovative and evidence-based strategies to tackle chronic crime in their jurisdictions.

• City of Atlantic City, $699,990

 

BJA Innovative Prosecution Solutions for Combatting Violent Crime

The program provides state, local and tribal prosecutors with resources, training and technical assistance to implement technology and develop strategies and programs to address and prosecute individuals who commit violent crime.

• Cumberland County, $135,000

 

OJJDP Gang Prevention, Intervention, and Suppression

More than $10 million was awarded to 24 jurisdictions under OJJDP’s Comprehensive Anti-Gang Programs for Youth. These programs provide funding for communities to develop youth gang intervention or suppression programs that aim to reduce violence.

Category I: Intervention

• Cumberland County, $499,791

 

National Criminal History Improvement Program

NCHIP enhances the quality, completeness, and accessibility of criminal history record information to state, territory and federal systems used by the NICS and ensures the nationwide implementation of criminal justice and noncriminal justice background check systems.

• N.J. Department of Law and Public Safety, $666,616

 

For a complete list of individual grant programs, award amounts, and jurisdictions that will receive funding, click here. More information about OJP and its components can be found at www.ojp.gov

CAMDEN, N.J. – The leader of an Atlantic City drug-trafficking organization was sentenced today to 135 months in prison for conspiring to distribute one kilogram or more of heroin, U.S. Attorney Craig Carpenito announced.

Khalif Toombs, 31, of Egg Harbor Township, New Jersey, previously pleaded guilty before U.S. District Judge Robert B. Kugler to an information charging him with one count of conspiracy to distribute and possess with intent to distribute more than one kilogram of heroin. Judge Kugler imposed the sentence today in Camden federal court.

Toombs guilty plea was charged as part of a federal drug investigation that culminated in the arrest of 22 individuals. Thirteen other members of the drug trafficking conspiracy – Wilbert Toombs, Quadir Stanley, Dean Johnson, Khalif Davis, Joseph Aversa, Thomas Randall, Mayda Hernandez, Sarah Taliaferro, James Blackwell, Philip Surace, Nasir Brown, Karon Carey, and David Ramirez – previously pleaded guilty to their respective roles in the conspiracy. Eight other defendants have been indicted for their roles in the conspiracy and their cases remain pending.  

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

Toombs and other members of the drug conspiracy trafficked heroin from Paterson, New Jersey, into Atlantic City, New Jersey. Toombs admitted in court to conspiring with others to traffic between three and 10 kilograms of heroin during the period of the investigation and to being a manager and supervisor of the drug trafficking conspiracy, which operated throughout Atlantic County. An investigation led by the FBI used physical and video surveillance, confidential informants, consensual recordings, and two court-authorized wiretaps to uncover the operation. The investigation tracked multiple stamps of heroin being distributed by Toombs and others, including, “AK-47,” “Apple,” “Fortnite,” “Rolex,” “Frank Lucas,” “Bentley,” “Pandora,” and “9 ½.” Between Jan. 1, 2017, and June 21, 2019, these stamps have accounted for 48 deaths and 84 non-fatal overdoses in New Jersey.

In addition to the prison term, Judge Kugler sentenced Toombs to five years of supervised release.

U.S. Attorney Carpenito credited special agents of the FBI’s Safe Streets South Jersey Violent Incident and Gang Task Force, Atlantic City Resident Agency, and FBI, Newark, under the direction of Special Agent in Charge George M. Crouch Jr.; officers of the Atlantic City Police Department, under the direction of Chief James Sarkos; the Atlantic County Prosecutor’s Office, under the direction of Prosecutor Damon Tyner; the Atlantic County Sheriff’s Department, under the direction of Sheriff Eric Scheffler; and the Pleasantville Police Department, under the direction of Chief Sean Riggin, with the investigation leading to today’s sentencing. He also thanked the U.S. Department of Homeland Security, Homeland Security Investigations; the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives; the Drug Enforcement Administration; and the N.J. State Police for their assistance.

This case is being conducted 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.

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

For the eight defendants whose charges remain pending, the charges and allegations are merely accusations, and they are presumed innocent unless and until proven guilty.

CAMDEN, N.J. – A Gloucester County, New Jersey, man pleaded guilty today to producing and distributing images of child sexual abuse, U.S. Attorney Craig Carpenito announced.

Andrew Nicholas, 24, of Williamstown, New Jersey, entered a guilty plea 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.

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 of child sexual abuse involving a prepubescent minor. Nicholas admitted to producing those images of child sexual abuse and sending them to the officer through Kik Messenger.

The count of sexually exploiting children carries a mandatory minimum penalty of 15 years in prison, a maximum potential penalty of 50 years in prison and a $250,000 fine. The distribution of child pornography count carries a mandatory minimum penalty of five years in prison, a maximum possible penalty of 40 years in prison and fine of $250,000 per count. Sentencing is scheduled for March 9, 2021.

U.S. Attorney Carpenito 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, with the investigation leading to today’s guilty plea. This case was initiated by the FBI, Washington Field Office’s Child Exploitation and Human Trafficking Task Force and worked in partnership with the FBI, Philadelphia Field Office, and local assisting agencies. 

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. – The former president of the Jersey City Board of Education (JCBOED) and former Acting Executive Director of the Jersey City Employment and Training Program (JCETP) and an Ocean County, New Jersey, attorney were indicted today for embezzlement, money laundering, and fraud in connection with multiple criminal schemes, U.S. Attorney Craig Carpenito announced.

The former president of the Jersey City Board of Education (JCBOED) and former Acting Executive Director of the Jersey City Employment and Training Program (JCETP) and an Ocean County, New Jersey, attorney were indicted today for embezzlement, money laundering, financial fraud in connection with multiple criminal schemes, U.S. Attorney Craig Carpenito announced.

Sudhan M. Thomas, 45, of Jersey City, New Jersey, was charged in a 26-count indictment with embezzling funds from JCETP, an organization receiving federal funds (Count 1), and wire fraud (Counts 2 to 6) and money laundering (Counts 7 to 9) in connection with the JCETP theft. In connection with other schemes, Thomas was charged with wire fraud for embezzling money from his 2016 JCBOED campaign (Count 10); wire fraud for embezzling money from his 2019 JCBOED campaign (Counts 11 and 12); bank fraud for stealing checks issued by and to another JCBOED candidate’s campaign in 2018 (Counts 13 and 14); and mail and wire fraud for schemes to defraud two separate Florida companies (Counts 15 to 26). Thomas was charged by criminal complaint in January 2020 with embezzling funds from JCETP and was released on a $75,000 unsecured bond.

Paul H. Appel, 78, of Point Pleasant, New Jersey, also is charged as Thomas’ accomplice in Counts 1, 7 to 10, and 15 to 26 of the indictment.

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

Thomas served as JCETP’s acting executive director from January 2019 until his resignation in July 2019. JCETP is a nonprofit organization that operates to assist Jersey City residents to prepare for and enter the workforce. JCETP received substantial amounts of funding from federal grants from the U.S. Department of Labor and the U.S. Department of Housing and Urban Development.

Using his access to JCETP funds and control of JCETP’s bank accounts, from March 2019 through July 2019, Thomas embezzled more than $45,000 from JCETP. Thomas caused checks to be drawn from JCETP accounts that were made payable to others, but ultimately received by Thomas or used to pay his debts and expenses. For example, Thomas caused certain checks to be issued to Appel, who is an attorney, and Appel then redirected the funds to Thomas, including by issuing checks made payable to Next Glocal, an entity for which Thomas was a director, which were then deposited into a bank account for Next Glocal that Thomas controlled. Thomas also embezzled JCETP funds by issuing JCETP checks made out to cash that Thomas either cashed himself or used to obtain bank checks that Thomas made payable to Next Glocal, which were deposited into a bank account for Thomas’ personal use.

Thomas ran for and was elected to a seat on the JCBOED in 2016, ultimately serving as vice president and then president of the JCBOED. Appel served as treasurer for Thomas’s 2016 campaign. From September 2016 to November 2016, Thomas and Appel collected campaign contributions and deposited them into a bank account opened for the 2016 campaign that they both controlled. Under the guise of collecting repayments for loans to the campaign or reimbursement for other purported campaign-related expenses, Thomas and Appel embezzled more than $8,000 from Thomas’s 2016 campaign for their own personal use.

Thomas ran for re-election to the JCBOED in 2019. From June 2018 to August 2019, Thomas collected campaign contributions and deposited them into two bank accounts opened for the 2019 campaign. Under the guise of collecting repayments for loans to the campaign, Thomas embezzled approximately $6,000 from the 2019 campaign by causing checks to be issued from the campaign bank accounts made payable to Thomas, and then cashed those checks or deposited them into a bank account for Thomas’s personal use. 

In November 2018, Thomas informally advised a candidate in the 2018 JCBOED election. He falsely represented to that candidate’s campaign that he required $100 checks to pay eight separate individuals who worked on the candidate’s campaign. When the campaign provided Thomas with the requested checks, Thomas fraudulently endorsed the checks and deposited them into a bank account for his personal use. In addition, Thomas obtained a $1,000 contribution check made payable to the candidate’s 2018 campaign committee; Thomas fraudulently endorsed that check and deposited it into a bank account for his personal use.

In 2016, Thomas and Appel entered into an agreement with a Florida-based technology company to purportedly expand the company’s business through a debit card program. Between May 2016 and October 2016, Thomas and Appel made false representations regarding work they were allegedly undertaking pursuant to the agreement and induced the technology company to wire them a total of $48,500. Thomas and Appel ultimately diverted the company’s funds to their own bank accounts and used them to pay personal expenses (including payments to Thomas’ landlord, tuition for Thomas’s relative, and payments for Appel’s credit and debit card expenses) without providing any meaningful services or generating any business as required under the agreement, or spending any substantial parts of the funds provided by the technology company towards fulfilment of the agreement. 

In 2016, Thomas and Appel entered into another agreement with a Florida-based housing company in connection with the purported sale of modular homes to veterans and the homeless.  Between October 2016 and April 2017, Thomas and Appel made false representations regarding work they would undertake pursuant to the agreement in order to collect monthly $2,000   payments from the housing company. The housing company made five $2,000 payments to Thomas and Appel between November 2016 and March 2017. Thomas and Appel misappropriated the funds without providing any meaningful services or generating any business as required under the agreement, or spending any substantial part of the funds towards fulfilment of the agreement.

The charges in the indictment carry the following maximum penalties:

Offenses Charged

Maximum Term of Imprisonment

Maximum Fine

Theft from a federally-funded organization

10 years

$250,000

Wire fraud

20 years

$250,000

Mail fraud

20 years

$250,000

Bank fraud

30 years

$1 million

Money laundering

20 years

$500,

U.S. Attorney Carpenito credited special agents with the FBI, under the direction of Special Agent in Charge George M. Crouch Jr., and special agents of the U.S. Department of Labor, Office of Inspector General, New York Region, under the direction of Special Agent in Charge Michael C. Mikulka with the investigation leading to the charges.

The government is represented by Assistant U.S. Attorney Tazneen Shahabuddin of the Special Prosecutions Division in Newark.

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

CAMDEN, N.J. – A Salem County, New Jersey, man made his initial appearance today after being charged with illegally possessing a handgun, U.S. Attorney Craig Carpenito announced.

Donyell M. Stewart, 48, of Salem, New Jersey, is charged by complaint with one count of possession of a firearm and ammunition by a convicted felon. He appeared by videoconference before U.S. Magistrate Judge Ann Marie Donio and was detained pending a bail hearing next week.

According to documents filed in this case:

On Aug. 31, 2020, an officer with the Salem County Sheriff’s Office attempted to conduct a stop of Stewart’s car after a 911 caller reported that Stewart’s car fled from a car accident. Stewart disregarded the officer’s signals to stop and proceeded to drive multiple blocks before pulling into the parking lot of a laundromat. Stewart exited his car with a brown handbag, from which officers later recovered a Springfield Armory XD .40 caliber pistol loaded with 10 rounds of ammunition, as well as 5.5 ounces of suspected cocaine and drug paraphernalia.  Stewart has at least five prior New Jersey felony convictions for controlled substance offenses, including a New Jersey conviction for being the leader of a narcotics trafficking network. 

The charge of possession of a weapon by a convicted felon is punishable by 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.

U.S. Attorney Carpenito credited special agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Charlie J. Patterson, Newark Field Division, Camden Field Office, with the investigation leading to today’s charge.  He also thanked the Salem City Police Department, under the direction of Chief John A. Pelura, III; the Salem County Sheriff’s Office, under the direction of Sheriff Charles M. Miller; and the Salem County Prosecutor’s Office, under the direction of Prosecutor John T. Lenahan, for their assistance. 

The government is represented by Assistant U.S. Attorney Jeffrey Bender of the U.S. Attorney’s Office 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 Philadelphia man today admitted his role in a fentanyl distribution conspiracy, U.S. Attorney Craig Carpenito announced. 

Jonathan Rivera Pagan, 37, pleaded guilty by videoconference before U.S. District Judge Noel L. Hillman to an information charging him with conspiring to distribute and possess with intent to distribute 400 grams or more of fentanyl. 

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

In early 2020, Rivera Pagan and his conspirator, Ronal Alberto Hernandez Pinales, met and communicated about fentanyl trafficking and firearms. On March 2, 2020, Rivera Pagan and Hernandez Pinales arranged to deliver fentanyl to another individual.

On March 2, 2020, Rivera Pagan and Hernandez Pinales drove separately to the parking lot of a building in Gloucester County to conduct the planned fentanyl transaction. Shortly thereafter, Rivera Pagan and Hernandez Pinales fled from the parking lot, after seeing what they believed to be law enforcement presence in the area. Rivera Pagan was later arrested in the parking lot of a nearby bar, and Hernandez Pinales was arrested near a highway. Law enforcement officers recovered approximate 900 grams of fentanyl from Hernandez Pinales’ car, as well as cellphones from Rivera Pagan and Hernandez Pinales that contained drug-related communications.

The charge to which Pagan pleaded guilty carries a mandatory minimum penalty of 10 years in prison, a maximum penalty of life in prison and a fine of up to $10 million. Sentencing is scheduled for March 5, 2021.

U.S. Attorney Carpenito credited special agents and task force officers with the Drug Enforcement Administration, under the direction of Special Agent in Charge Susan A. Gibson in Newark, with the investigation leading to today’s plea. He also thanked the Gloucester County Prosecutors Office, the East Greenwich Police Department, and the N.J. State Police Canine Tactical Applications Group for their assistance.

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

The count of conspiracy to distribute and possess with intent to distribute 400 grams or more of fentanyl against Hernandez Pinales remains pending, and he is presumed innocent unless proven guilty.

TRENTON, N.J. – A Passaic County, New Jersey, man today admitted to assaulting with a dangerous weapon two people who were swimming in the Delaware River, U.S. Attorney Craig Carpenito announced.

Jeffrey A. Mulcahy, 58, of Wayne pleaded guilty by videoconference before U.S. District Judge Michael A. Shipp to an information charging him with one count of assault with a dangerous weapon with intent to do bodily harm.

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

On Sept. 2, 2019, two individuals (Victim 1 and Victim 2) were swimming in the Delaware River in the Kittatinny Point area of the Delaware Water Gap in Warren County, New Jersey. Mulcahy approached them and began speaking to them about fishing. After a few minutes, Mulcahy departed the area, returning approximately 15 minutes later, holding a can of beer. He continued to talk to Victim 1 and Victim 2 about fishing, however, Mulcahy appeared agitated. Victim 1 and Victim 2 had gotten out of the river and were standing near the riverbed.    Mulcahy removed what appeared to be a handgun from his waistband and pointed it at Victim 2’s head. While pointing the gun at Victim 2, Mulcahy ordered Victims 1 and 2 to the ground.  Mulcahy then pointed the gun at Victim 1 and stated that he was going to kill Victim 1 if Victim 1 did not listen to him. Mulcahy struck Victim 1 in the head and neck area with the handgun.  Mulcahy then began pulling rope out of his pocket and attempted to get Victim 1’s hands behind Victim 1’s back. Victim 1 resisted and was able to take Mulcahy to the ground, where the two began a physical struggle. Mulcahy’s handgun fell to the ground and Victim 2 recovered it and left to contact law enforcement. After the brief physical altercation, Victim 1 ran off to a nearby picnic area to locate Victim 2. Mulcahy departed the area and was later apprehended by law enforcement officers in Hackettstown, New Jersey. Subsequent investigation of the handgun that Victim 2 recovered from Mulcahy revealed that it was a pellet gun. 

The charge of assault with a dangerous weapon with intent to do bodily harm carries a maximum punishment of 10 years in prison and a fine of up to $250,000. Sentencing is scheduled for March 4, 2021.

U.S. Attorney Carpenito credited park rangers of the U.S. National Park Service, under the direction of Chief Ranger Eric Lisnik, the Hackettstown Police Department, under the direction of Chief James A. Macaulay, and the N.J. State Police, under the direction of Col. Patrick J. Callahan, with the investigation leading to today’s guilty plea. 

The government is represented by Assistant U.S. Attorney Nicholas P. Grippo, Deputy Chief of the Criminal Division in Newark.

NEWARK, N.J. – A Bergen County, New Jersey, doctor today admitted participating in a conspiracy to violate the federal anti-kickback statute, U.S. Attorney Craig Carpenito announced.

Mark A. Filippone, 72, of Wallington, New Jersey, pleaded guilty today by videoconference before U.S. District Judge Susan D. Wigenton to an information charging him with conspiring to violate the anti-kickback statute with three individuals: Joseph Vangelas, a/k/a “Joseph Miller,” 34, of Fort Lee, New Jersey; Marlene Vangelas, 59, of River Vale, New Jersey; and Zachary Ohebshalom, 34, of Fort Lee, New Jersey. Criminal charges against Miller and Marlene Vangelas remain pending. Ohebshalom previously pleaded guilty for his role in the conspiracy, and Estela Blaustein, 55 of Mahwah, New Jersey, also previously pleaded guilty for her role in a related conspiracy to commit health care fraud. 

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

Beginning in May 2016, Filippone participated in a kickback conspiracy scheme to obtain millions of dollars in health benefits from the federal workers’ compensation program by prescribing and dispensing expensive, but medically unnecessary, pain creams. Filippone treated hundreds of now-former U.S. Postal Service employees for injuries they purportedly suffered on the job. He allegedly facilitated their disability claims by submitting forms and medical reports to the Department of Labor, Office of Workers’ Compensation Program, for patients who were not, in fact, disabled.

Filippone also prescribed expensive topical pain creams, which were not needed or wanted by many of his patients. Filippone steered these prescriptions to a pharmacy in Fair Lawn, New Jersey, which was owned and operated by Miller and Marlene Vangelas. Miller and Marlene Vangelas, along with Ohebshalom, directed pharmacy employees to mine reimbursement rates within the federal workers’ compensation program for the ingredients of the pain creams in order to determine the most lucrative formulations. Miller, Marlene Vangelas, and Ohebshalom also directed pharmacy employees to print prescription labels for Filippone to use with his patients. Filippone used the pre-printed labels and sent the prescriptions back to the Fair Lawn Pharmacy. In order to induce Filippone to prescribe the medically unnecessary pain creams in the exact formulations they wished to obtain, Miller and Marlene Vangelas orchestrated the purchase of Filippone’s medical office and then permitted Filippone to continue to use the premises, for which he routinely failed to pay rent. Miller, Marlene Vangelas, and Ohebshalom conspired to leverage the property to force Filippone to continue to send prescriptions to their pharmacy. Filippone continued to feed prescriptions to the pharmacy, so long as Miller and Vangelas permitted him to remain rent-free in the property.

The count of conspiracy to violate the federal anti-kickback statute is punishable by a maximum of five years in prison and a fine of $250,000, or twice the gross gain or loss derived from the offense, whichever is greater. Sentencing is scheduled for March 3, 2021.

U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark; the U.S. Postal Service, Office of Inspector General, under the direction of Special Agent in Charge of the Northeast Area Field Office Matthew M. Modafferi; the Department of Labor, Office of Inspector General, New York Region, under the direction of Special Agent in Charge Michael C. Mikulka; and special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Michael Montanez in Newark, with the investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorneys Joshua L. Haber and Nicole F. Mastropieri of the Health Care Fraud Unit in the Criminal Division, Newark.

The charges and allegations in the information pertaining to Miller and Marlene Vangelas are merely accusations, and they are presumed innocent unless and until proven guilty.

NEWARK, N.J. – A Morris County, New Jersey, man was arrested and three co-defendants pleaded guilty today in connection with a conspiracy to commit bank fraud and bank bribery, U.S. Attorney Craig Carpenito announced.

Kurt Phelps, 52, of Flanders, New Jersey, was charged by complaint with one count of conspiracy to commit bank fraud and one count of bank bribery. He made his initial appearance by videoconference today before U.S. Magistrate Judge Mark Falk and was released on $100,000 unsecured bond.

Three co-defendants pleaded guilty by videoconference before U.S. District Judge Kevin McNulty to their respective roles in the scheme: Douglas Arbolino, 59, of Central Valley, New York, and Gary Swenson, 59, of Hardyston, New Jersey, each pleaded guilty to informations charging them with one count of conspiracy to commit bank fraud and one count of bribery of a bank official; and John Scott Brink, 59, of Jackson, New Jersey, pleaded guilty to an information charging him with one count of conspiracy to commit bank fraud.

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

From 2013 through 2019, Phelps, Arbolino, Swenson, and Brink, conspired to defraud Victim Bank-1, Phelps’s employer. The defendants obtained millions of dollars of credit from Victim Bank-1 for Starnet Business Solutions Inc. (Starnet), a now-defunct New Jersey-based printing company where Arbolino, Swenson, and Brink worked. Arbolino, Swenson, and Brink paid Phelps large cash bribes in connection with the fraud scheme

In 2013, Starnet provided materially false financial information to Victim Bank-1 and received a line of credit. Brink sent Victim Bank-1 inflated accounts receivable information, and Arbolino and Swenson provided other materially false financial information, such as semi-annual financial reports. Victim Bank-1 not only allowed Starnet to maintain the line of credit, it increased the credit available at various times. By 2018, the line of credit available to Starnet was worth approximately $8 million, and Starnet has not repaid it.

Phelps was aware that financial information Starnet provided to Victim Bank-1 was materially false. Phelps coached Starnet on how to defraud Victim Bank-1. Phelps would review draft financial information for Starnet and provide feedback on how his conspirators should falsify the information before submitting it. Phelps also worked to ensure that Victim Bank-1 did not detect the fraud scheme by helping Starnet avoid audits and other quality control measures employed by Victim Bank-1. 

Phelps solicited large cash bribes – tens of thousands of dollars at a time – from Starnet in connection with the fraud scheme. Arbolino, Swenson, and Brink pooled cash to pay Phelps bribe payments, which were hand-delivered, and totaled hundreds of thousands of dollars. 

The conspiracy to commit bank fraud, bribery of a bank official, and bank bribery charges each carry a maximum potential penalty of 30 years in prison and a $1 million fine, or twice the gross gain or loss from the offense.

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

U.S. Attorney Carpenito 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 arrest and guilty pleas.

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

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

NEWARK, N.J. – A federal grand jury today indicted a Union County, New Jersey, man for allegedly persuading, inducing and enticing numerous female victims, usually commercial sex workers, to travel in interstate or foreign commerce to engage in prostitution and other sexual acts, often by use of force, violence and threats, U.S. Attorney Craig Carpenito announced.

Jose Torres, 43, of Elizabeth, New Jersey, was charged in a second superseding indictment with his fifth and sixth counts of coercing and enticing commercial sex workers, and will be arraigned on those counts on a date to be determined. Torres was originally charged by complaint in February 2020 with two counts of coercing and enticing commercial sex workers. On May 29, 2020, he was indicted on three counts, including a third count involving another victim. On July 31, 2020, he was indicted on a fourth count involving another victim.

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

From May 2015 to October 2019, Torres persuaded, induced and enticed female victims, often commercial sex workers, to travel from various out of state locations, including Canada, New York, and Pennsylvania, in order to engage in prostitution with him. In each instance, Torres lured a female victim to New Jersey with promises of large payments. In three of the previously charged instances, when the victim asked for payment, Torres became aggressive, often assaulting and raping victim. Torres never paid the women. The two recently charged counts involve allegations that in December and November of 2015, Torres lured Victim-5 and Victim-6, respectively, to travel from New York to New Jersey to engage in prostitution.

The coercion and enticement charge carries a maximum term of 20 years in prison and a fine of up to $250,000 fine for each count.

U.S. Attorney Carpenito 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 Department of Homeland Security, Homeland Security Investigations, under the direction of Special Agent in Charge Jason J. Molina, with the investigation leading to the charges.

The government is represented by Assistant U.S. Attorney Emma Spiro of the U.S. Attorney’s Office Violent Crimes Unit in Newark.

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

TRENTON, N.J. – A Texas man was sentenced today to 24 months in prison for conspiring to distribute heroin, fentanyl and methamphetamine, U.S. Attorney Craig Carpenito announced.

Juan Macias Prieto, 53, of El Paso, Texas, previously pleaded guilty before U.S. District Judge Anne E. Thompson in Trenton federal court to one count of conspiracy to distribute and possess with the intent to distribute one kilogram or more of heroin, 400 grams or more of fentanyl, and five grams or more of methamphetamine, and one count of possession with intent to distribute one kilogram or more of heroin, 400 grams or more of fentanyl, and five grams or more of methamphetamine. Judge Thompson imposed the sentence by videoconference today.

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

On Sept. 17, 2019, Macias Prieto conspired with others to distribute narcotics. Macias Prieto, a commercial truck driver, transported approximately 21 kilograms of narcotics into New Jersey with the intent to distribute the narcotics to conspirators. 

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

U.S. Attorney Craig Carpenito credited special agents of the Drug Enforcement Administration, under the direction of Special Agent in Charge Ray Donovan in New York, with the investigation leading to today’s sentencing. 

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

CAMDEN, N.J. – The owner of a Wildwood Crest, New Jersey, pizzeria was sentenced today to 15 months in prison for filing false income tax returns, U.S. Attorney Craig Carpenito announced.

Giuseppe D’Arancio, 61, of Cape May Court House, New Jersey, previously pleaded guilty before U.S. District Judge Joseph H. Rodriguez to an information charging him with five counts of filing a false income tax return for tax years 2012 through 2016. Judge Rodriguez imposed the sentence today in Camden federal court.

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

D’Arancio and another individual owned and operated a pizzeria and kept two sets of accounting books. For tax years 2012 through 2016, D’Arancio knowingly filed false tax returns which underreported the pizzeria’s taxable income by approximately $1.2 million. As a result, D’Arancio failed to pay more than $425,000 in income taxes.

In addition to the prison term, Judge Rodriguez sentenced D’Arancio to one year of supervised release and ordered him to pay $507,246 in restitution to the IRS.

U.S. Attorney Carpenito credited special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Michael Montanez, with the investigation leading to today’s sentencing.

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

NEWARK, N.J. – A Bergen County, New Jersey, man made his initial court appearance today on charges of conspiring to commit money laundering, U.S. Attorney Craig Carpenito announced.

Ramfis Minaya, 23, of Englewood, New Jersey, is charged by complaint with one count of conspiracy to commit money laundering. He appeared by videoconference today before U.S. Magistrate Judge Leda Dunn Wettre.

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

Since 2019, the U.S. Drug Enforcement Administration (DEA) has been investigating a drug trafficking and money laundering organization (“DTO/MLO”) operating in Mexico, New York, New Jersey, and elsewhere. During the course of this investigation, law enforcement learned that the organization conducts money laundering transactions through the use of couriers with the objective of repatriating narcotics proceeds to narcotics source countries.

In August 2020, law enforcement identified Minaya as a member of the organization, responsible for the transportation and delivery of significant quantities of narcotics proceeds. Since August 2020, law enforcement has seized more than $5 million from money laundering transactions and stashes of narcotics proceeds in which Minaya was directly involved.

For example, on Oct. 27, 2020, law enforcement officers observed Minaya exit his residence and provide another individual (Individual-2) a bag that was eventually determined to contain approximately $100,000 in narcotics proceeds. Officers later saw Minaya exit his home with a bag that was determined to contain another $100,000 in narcotics proceeds.

The charge of conspiracy to commit money laundering, carries a maximum penalty of 20 years in prison, and a $500,000 fine, or twice the amount of money involved in the offense, whichever is greater.

U.S. Attorney Carpenito credited special agents and Task Force Officers with the DEA, under the direction of Special Agent in Charge Susan A. Gibson, with the investigation leading to these charges.

The government is represented by Special Assistant U.S. Attorney Keith Travers of the U.S. Attorney’s Office Organized Crime and Drug Enforcement Task Force/Narcotics Unit in Newark.

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

NEWARK, N.J. – Three men have been charged with various sex offenses after attempting to have sexual contact with individuals they believed to be children they met online, U.S. Attorney Craig Carpenito announced today.

Quentin Anthony Blount, 28, of Easton, Pennsylvania, Jesus Modesto Sanchez, 29, of New York City, and Ryan Lee, 35, of Trenton, New Jersey, are charged in separate complaints: Blount is charged with interstate travel with the intent to engage in illicit sexual conduct and attempted sex trafficking of a minor; Modesto Sanchez is charged with interstate travel with the intent to engage in illicit sexual conduct and possession of child pornography; and Lee is charged with attempted online enticement and attempted transfer of obscene materials to minors. Blount and Lee made their initial appearances by videoconference before U.S. Magistrate Judge James B. Clark III on Oct. 23, 2020, and were detained. Modesto Sanchez is expected to make his initial appearance later this week.

“Sexual crimes against children are among the most difficult cases we handle,” U.S. Attorney Carpenito said. “I am proud my office is working hand in hand with our partners at the FBI and the Somerset County Prosecutor’s Office to make sure these predators are identified and prosecuted with all the tools at our disposal.”

“Our children and their online safety is the utmost concern to us at the Somerset County Prosecutor’s Office,” Somerset County Prosecutor Michael Robertson said. “Social media apps allow predators into our homes and as law enforcement, we must do what we can to make it a safer environment. We hope that this operation will continue to be eye-opening for parents. Although, 12 online child predators have been arrested, parents must learn the apps that their children are using and the inherent dangers within.”

“Children are our most vulnerable population, and crimes such as these are unthinkable,” Special Agent in Charge George M. Crouch Jr. of the FBI Newark Division said. The FBI and our law enforcement partners will stop at nothing to prevent these heinous crimes, safeguard our children, and bring justice to all.”

According to documents filed in these cases and statements made in court:

Special agents of the FBI and local law enforcement engaged in an operation targeting individuals who use the internet to exploit children. Blount, Modesto Sanchez and Lee were among several individuals identified and arrested.

On Oct. 15, 2020, Blount used an internet-based application to communicate with an individual who he believed was offering her 14-year-old daughter for sex in exchange for money. Unbeknownst to Blount, he was communicating with an undercover law enforcement officer. Blount travelled from Easton to a location in Somerset County, New Jersey, to meet with the mother and the minor. Upon his arrival, he provided a sum of cash to the undercover officer, who Blount believed was the child’s mother, and was arrested by law enforcement.

In mid-October 2020, Modesto Sanchez used an internet-based application to communicate with an undercover officer who Modesto Sanchez believed was a 13-year-old child. During the conversation, Modesto Sanchez offered to perform various sex acts. On Oct. 17, 2020, Modesto Sanchez travelled from New York to a location in Somerset County to meet with the child. Law enforcement identified Modesto Sanchez as he approached the location where he believed the minor to be, at which time he was arrested by law enforcement. A search of Modesto Sanchez’ cellular telephone revealed over 200 videos depicting the graphic sexual exploitation of children.

In mid-October 2020, Lee used an internet-based application to communicate with an undercover officer, who Lee believed was a 13-year-old child. During the conversations, which were sexual in nature, Lee repeatedly asked the individual who he believed was 13 to send him nude photographs, while also sending multiple photographs of his penis to the undercover officer. On Oct. 17, 2020, Lee travelled from Trenton to a location in Somerset County where he believed the minor was located. Law enforcement identified Lee as he approached the location and arrested him.

The charges of attempted sex trafficking of a minor and attempted online enticement each carry a mandatory minimum of 10 years in prison and a maximum penalty of life in prison. The charge of interstate travel with the intent to engage in illicit sexual conduct carries a maximum penalty of 30 years in prison. The charge of transferring obscene materials to a minor carries a maximum term of 10 years in prison. The charge of possession of child pornography carries a maximum penalty of 10 years in prison. Each count carries a fine of up to $250,000.

U.S. Attorney Carpenito credited special agents with the FBI, under the direction of Special Agent in Charge George M. Crouch Jr.; detectives with the Somerset County Prosecutor’s Office, under the direction of Prosecutor Michael H. Robertson and Chief John W. Fodor, and officers with the Somerville, Bound Brook, and Hillsborough Police Departments with the investigation leading to these charges.

The government is represented by Assistant U.S. Attorney Shawn Barnes of the U.S. Attorney’s Office Criminal Division in Newark.

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

Defense counsel: Blount and Lee: Rahul Sharma Esq., Assistant Federal Public Defender, Newark

NEWARK, N.J. – A Passaic County, New Jersey, woman today admitted participating in a scheme that involved the creation of false documentation to secure over $4 million in bank loans, U.S. Attorney Craig Carpenito announced.

Gladys Collins, 43, of Wayne, New Jersey, pleaded guilty by videoconference before U.S. District Judge Kevin McNulty to an information charging her with one count of conspiracy to commit bank fraud.

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

Between March 2016 and September 2019, Cash Flow Partners LLC, a business consulting firm with offices in New York and New Jersey, released internet advertisements and held seminars offering to assist customers in obtaining bank loans, including loans insured by the Federal Deposit Insurance Corporation (FDIC). When customers submitted documentation supporting their bank loan applications to Cash Flow Partners, Collins and others created false documentation to make customers’ loan applications appear more financially viable than they actually were. Victim banks sustained losses of over $4 million.

Three of Collins’ conspirators, Edward Espinal, Jennie Frias, and Raymundo Torres, have previously pleaded guilty to charges relating to their role in the Cash Flow bank fraud conspiracy and are awaiting sentencing.

The conspiracy to commit bank fraud charge carries a maximum potential penalty of 30 years in prison and a $1 million fine. Sentencing is scheduled for March 8, 2021.

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

U.S. Attorney Carpenito credited special agents of the FDIC-Office of the Inspector General (FDIC-OIG), under the direction of Special Agent in Charge Patricia Tarasca in New York, 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 today’s guilty plea.

The government is represented by Assistant U.S. Attorneys J. Stephen Ferketic of the Opioids Unit and Ari B. Fontecchio of the U.S. Attorney’s Office Economic Crimes Unit in Newark.

Defense counsel: Lawrence M. Fisher Esq., New York

NEWARK, N.J. – A Bergen County, New Jersey, man was charged with distributing images of child sexual abuse, U.S. Attorney Craig Carpenito announced today.

Joseph Ganaro, 42, Lodi, New Jersey, is charged by complaint with one count of distribution of child pornography. He appeared by videoconference today before U.S. District Judge Leda Dunn Wettre and was detained.

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

From Feb. 1, 2019 through Oct. 27, 2020, Ganaro received and distributed material containing images of child sexual abuse, via the BitTorrent Network, a publicly available online peer-to-peer (P2P) file-sharing network of linked computers. Users must download P2P software, which is widely available for free on the Internet. The software allows the user to place files into a designated “shared” folder on his or her hard drive, from which other BitTorrent users can then download those files directly to the “shared” folders of their own computers. Users can then browse, search, select, and directly download, those files. The software typically keeps a log of each download event.

Law enforcement used special software to access the BitTorrent Network and downloaded 10 video files containing child pornography from an IP address assigned to an internet service provider account associated with Ganaro’s residence. 

The count with which Ganaro is charged carries a mandatory minimum penalty of five years of in prison, a potential maximum penalty of 20 years in prison and a maximum fine of $250,000.

U.S. Attorney Carpenito credited special agents of the U.S. Department of Homeland Security, Homeland Security Investigations, New Jersey Division, under the direction of Special Agent in Charge Jason J. Molina, and inspectors with the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Raimundo Marrero, with the investigation leading to today’s charges. He also thanked the Lodi Police Department for its assistance with the investigation.

The government is represented by Assistant U.S. Attorney Katherine Calle of the Organized Crime and Drug Enforcement Task Force/Narcotics Unit in Newark.

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

NEWARK, N.J. – U.S. Attorney Craig Carpenito announced today that Assistant U.S. Attorneys Allan Urgent, Mark McCarren and Gabriel Vidoni will lead the efforts of his Office in connection with the Justice Department’s nationwide Election Day Program.

“The right to vote without interference or discrimination, and to have that vote counted, is a cornerstone of our democracy,” U.S. Attorney Carpenito said. “We will not tolerate voter intimidation, voter bribery, election fraud or theft of ballots. We take seriously our responsibility to maintain the integrity of the election process.”

In order to respond to complaints of election fraud or voting rights concerns, and to ensure that such complaints are directed to the appropriate authorities, the public can call the Election Day Hotline – 888-636-6596. This number will be active Oct. 30, 2020, through Nov. 6, 2020, and will be staffed live on Election Day, Nov. 3, 2020.

Federal law protects against such crimes as intimidating or bribing voters, buying and selling votes, impersonating voters, altering vote tallies, stuffing ballot boxes, and marking ballots for voters against their wishes or without their input. It also contains special protections for the rights of voters, and provides that they can vote free from acts that intimidate or harass them. For example, actions of persons designed to interrupt or intimidate voters at polling places by questioning or challenging them, or by photographing or videotaping them, under the pretext that these are actions to uncover illegal voting may violate federal voting rights law. Further, federal law protects the right of voters to mark their own ballot or to be assisted by a person of their choice (where voters need assistance because of disability or illiteracy).

AUSAs Urgent, McCarren and Vidoni serve as the District Election Officers (DEOs) for the District of New Jersey, and in that capacity are responsible for overseeing the District’s handling of complaints of election fraud and voting rights concerns in consultation with Justice Department Headquarters in Washington.

The Department of Justice has an important role in deterring election fraud and discrimination at the polls, and combating these violations whenever and wherever they occur.  The Department’s long-standing Election Day Program furthers these goals, and also seeks to ensure public confidence in the integrity of the election process by providing local points of contact within the Department for the public to report possible election fraud and voting rights violations while the polls are open through Election Day.

In addition to the U.S. Attorney’s Office’s Hotline, the FBI will have special agents available in each field office and resident agency throughout the country to receive allegations of election fraud and other election abuses on Election Day. The FBI Newark field office can be reached by the public at 973-792-3000. The public may also call the FBI’s national tip line – 1-800-CALL-FBI (1-800-225-5324), and calls will be routed as appropriate.  The public may also submit online tips or complaints to the FBI via https://www.fbi.gov/tips .

Complaints about possible violations of the federal voting rights laws can be made directly to the Civil Rights Division in Washington, DC by phone at 800-253-3931 or by complaint form at https://civilrights.justice.gov/ .

In the case of a crime of violence or intimidation, please call 911 immediately and before contacting federal authorities. State and local police have primary jurisdiction over polling places, and almost always have faster reaction capacity in an emergency.

U.S. Attorney Carpenito said, “Ensuring free and fair elections depends in large part on the cooperation of the American electorate. It is imperative that those who have specific information about discrimination or election fraud make that information available to my Office, the FBI, or the Civil Rights Division.”

The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.

NEWARK, N.J. – A Colorado man will make his initial appearance today on charges that he smuggled approximately two kilograms of cocaine into the United States, U.S. Attorney Craig Carpenito announced.

Leandre Kemont Jefferson, 23, of Denver, Colorado, was arrested on Oct. 23, 2020. He is charged by complaint with one count of importation of controlled substances and is scheduled to appear by videoconference today before U.S. Magistrate Judge Leda Dunn Wettre.

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

On Oct. 23, 2020, Jefferson arrived at Newark Liberty International Airport aboard a flight from Puerto Plata, Dominican Republic. During a screening, law enforcement officers discovered that Jefferson possessed approximately two kilograms of cocaine concealed inside of 12 vacuum packed bags, which were themselves wrapped in foil, and which was further concealed inside of clothing.

The count with which Jefferson is charged carries a mandatory minimum penalty of five years in prison, a potential maximum penalty of 40 years in prison, and a $5 million fine.

U.S. Attorney Carpenito credited special agents of the U.S. Department of Homeland Security, Homeland Security Investigations, New Jersey Division, under the direction of Special Agent in Charge Jason J. Molina; and officers of U.S. Customs and Border Protection, under the direction of Troy Miller, director of Field Operations, New York Field Office, with the investigation leading to the charges.

The government is represented by Assistant U.S. Attorney Sean M. Sherman of the Criminal Division in Newark.

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

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Defense counsel: Peter Carter Esq., Assistant Federal Public Defender, Newark

NEWARK, N.J. – Fourteen people have been charged with scheming to defraud banks and individuals with counterfeit economic stimulus checks purportedly issued by the Treasury Department pursuant to the Coronavirus Aid, Relief, and Economic Security (CARES) Act, U.S. Attorney Craig Carpenito announced today.

Charged by complaint with conspiracy to commit bank fraud are:

Defendant

Age

Residence

Justin Ezeiruaku

23

Berlin, New Jersey

Torri Pedro

24

Sicklerville, New Jersey

*Akume Ehoggi

25

Glassboro, New Jersey

Kassan Knight

23

Newark

Nakirah Matthews

21

Paulsboro, New Jersey

*Qwan Taylor

22

Pennsauken, New Jersey

*Kwaeson Watts

24

Lindenwold, New Jersey

*Nasir Johnson

23

Newark

*Daeson Monroe

25

Philadelphia

Daron Curry

24

Westville, New Jersey

Talib Crump

26

Philadelphia

*Noah Brent-Magri

21

Somerset, New Jersey

Isaiah White

23

Virginia Beach, Virginia

Ali Shoultz

23

Clementon, New Jersey

*denotes at-large

Knight, Pedro, Shoultz, Matthews and Curry made their initial appearances Oct. 22, 2020, by videoconference before U.S. Magistrate Judge Ann Marie Donio. Ezeiruako will make his appearance on Oct. 26, 2020. Crump is in custody in Philadelphia. White was arrested in Virginia and will have an initial appearance at a date to be determined.

According to documents filed in this case:

U.S. Postal Inspection Service (USPIS) postal inspectors and special agents with the U.S. Department of Homeland Security, Homeland Security Investigations (HSI), uncovered a nationwide scheme involving counterfeit economic stimulus checks deposited into bank accounts with the intent to defraud the banks. A network of individuals posted advertisements on Instagram and Snapchat offering people the ability to make “quick cash” if they banked at certain institutions. Some members of the conspiracy acquired individuals’ banking information using a ruse, while others printed the counterfeit stimulus checks that they deposited into the accounts. Members of the conspiracy used ATM machines, and peer-to-peer bank transfers, as well as debit cards, to make large purchases and large cash withdrawals. Individuals financed purchases of luxury cars and paid for their apartments with the stolen funds. In many cases, the individuals whose accounts were compromised suffered financial losses and credit problems, while others were complicit in the fraud.

The count of bank fraud conspiracy is punishable by a maximum sentence of 30 years in prison and a $1 million fine.

U.S. Attorney Carpenito credited inspectors with the USPIS Philadelphia Division, under the direction of Inspector in Charge Damon Wood, and Eastern Area, under the direction of Inspector in Charge Kenneth Cleevely; special agents of HSI, Cherry Hill, New Jersey, under the direction of Special Agent in Charge Jason J. Molina in Newark; special agents of HSI, Norfolk, Virginia, under the direction of Special Agent in Charge Raymond Villanueva, in Washington, D.C.; special agents of IRS - Criminal Investigations, under the direction of Special Agent in Charge Michael Montanez in Newark; the U.S. Marshals Service, District of New Jersey, under the direction of U.S. Marshal Juan Mattos; the office of the Treasury Inspector General for Tax Administration, under the direction of Special Agent in Charge Andrew McKay; the Pennsylvania Attorney General’s Office, under the direction of Attorney General Josh Shapiro; the Glassboro Police Department, under the direction of Chief John Polillo; the Winslow Township Police Department, under the direction of Chief George M. Smith; the Gloucester Township Police Department, Special Investigations Unit, under the direction of Chief David J. Harkins; the Pennsauken Police Department, under the direction of Chief Jon Nettleton; the Paulsboro Police Department, under the direction of Chief Gary Kille; the Lindenwold Police Department, under the direction of Chief Michael McCarthy; the West Whiteland Township Police Department, under the direction of Chief Lee Benson; the Pennsylvania State Police, under the direction of Capt. James Kemm; the Pennsylvania State Police Bureau of Gaming Enforcement, under the direction of Lt. Kevin Conrad; and the New Jersey State Police, under the direction of Col. Patrick J. Callahan, with the investigation leading to the charges.

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 defendants are presumed innocent unless and until proven guilty.

NEWARK, N.J. – Twelve people have been charged for their participation in a scheme to steal and alter checks from the mail and engage in bank fraud, U.S. Attorney Craig Carpenito announced today.

Aaron Llody Northern, a/k/a “Bossdon Butta,” 28, of Reisterstown, Maryland; Corey Bond, a/k/a “Teddy Brown,” 27, of New York, New York; Tyrell Baker, 23, of the Bronx, New York; Andre Tyrone Wallace, 31, of the Bronx, New York; Michellian Thompson, 34, of the Bronx, New York; Achiel Morgan, a/k/a “Ace Skrap,” 22, of the Bronx, New York; Quinton Sessions, a/k/a “Q Doggy Widda Hoddie,” 27, of the Bronx, New York; Brian Adjavon, a/k/a “CarlosSlimm,” a/k/a “sasuforever,” 30, of the Bronx, New York; Dashawn Danforth, a/k/a “Shawn Moneyy Marley,” 31, of Staten Island, New York; Simone Cordero, 29, of the Bronx, New York; Stephanie Lee Sanchez, 25, of New York, New York; and Hans Pierre, a/k/a “hustlehans,” 32, of Brooklyn, New York; were each charged with one count of bank fraud conspiracy (Count One), one count of conspiracy to receive and possess stolen mail (Count Two); and one count of conspiracy to possess and receive interstate altered securities (Count Three).

Northern, Sessions, Adjavon, Danforth, and Pierre were also charged with one count of money laundering conspiracy (Count Four), and Northern and Cordero were additionally charged with one count of aggravated identity theft (Count Five).

Baker, Thompson, Morgan, Adjavon, Danforth, Sanchez, Cordero, and Wallace were arrested today and are scheduled to appear by videoconference before the U.S. Magistrate Judge James B. Clark III this afternoon. Northern was arrested this morning in Maryland and is scheduled to appear in the District of Maryland on Oct. 23, 2020. Bond, Sessions, and Pierre have not yet been arrested.         

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

In 2018 and 2019, the defendants and others conspired to steal checks from the mail, alter the payee and/or amount written on the stolen checks, possess and transport the stolen and altered checks outside of, or into, New Jersey, through interstate commerce, and deposit the checks into bank accounts to take money that did not belong to them. Some of the defendants then laundered the stolen money by concealing it through different financial accounts. 

Surveillance footage shows certain defendants and others stealing mail from U.S. Postal Service collection boxes in Newark. After stealing checks from the mail, defendants and others, including Adjavon and Cordero, altered and deposited the checks into other people’s bank accounts. The stolen money was then transferred to another account or withdrawn as cash. The victims include the New Jersey branch of a non-profit network of public charter schools, which experienced fraudulent activity on its bank accounts after placing checks in the mail.            

Count One carries a maximum sentence of 30 years in prison and a fine of $1 million. Counts Two and Three each carry a maximum sentence of five years in prison and a fine of $250,000, or twice the pecuniary gain to the defendant or loss to the victim, whichever is greater.  Count Four carries a maximum sentence of 20 years in prison and a fine of $500,000, or twice the value of the property involved in the transaction, whichever is greater. Count Five carries a mandatory term of two years in prison, which must run consecutively to any other sentence imposed, along with a maximum fine of $250,000 or twice to pecuniary gain to the defendant or loss to the victim, whichever is greater.

U.S. Attorney Carpenito credited special agents of the U.S. Postal Inspection Service Newark Division, under the direction of Acting Inspector in Charge Raimundo Marrero; the U.S Postal Inspection Service New York Division, under the direction of Inspector in Charge Phil Bartlett; the U.S. Secret Service Long Island Resident Office, under the direction of Resident Agent in Charge Steven Choma; the U.S. Postal Inspection Service Washington Division, under the direction of Inspector in Charge Peter Rendina; the U.S. Department of Homeland Security, Homeland Security Investigations Newark Division, under the direction of Special Agent in Charge Jason J. Molina, the Co-Op City Department of Public Safety, under the direction of Chief Joseph R. Riley; and the New York City Police Department, under the direction of Commissioner Dermot Shea; with the investigation and arrests.      

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

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

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Defense counsel:

Tyrell Baker: Michael V. Calabro Esq., Newark 

Andre Tyrone Wallace: Geoffrey St. Andrew Stewart Esq., New York   

Michellian Thompson: James A. Plaisted Esq., Hackensack, New Jersey

Achiel Morgan:  Blair R. Zwillman Esq., Morristown, New Jersey

Brian Adjavon:   Gary Mizzone Esq., Little Falls, New Jersey

Dashawn Danforth:  Adalgiza A. Nunez Esq., Newark

Simone Cordero:  Jacqueline E. Cistaro Esq., Red Bank, New Jersey

Stephanie Lee Sanchez:  Joseph Rubino Esq., Union, New Jersey

CAMDEN, N.J. – A Cape May, New Jersey, man was sentenced today to 180 months in prison for distributing approximately 300 grams of crystal methamphetamine and thousands of pills containing heroin and/or fentanyl, U.S. Attorney Craig Carpenito announced.

Joseph Servidio, a/k/a “Joey Electric,” 60, of Marmora, New Jersey, previously pleaded guilty before U.S. District Judge Robert Kugler to an information charging him with one count of conspiracy to distribute controlled substances, including 50 grams or more of crystal methamphetamine. Judge Kugler imposed the sentence today in Camden federal court.

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

Law enforcement sources have identified Servidio as a member of La Cosa Nostra (LCN), the Mafia. Servidio distributed pills that contained heroin and/or fentanyl along with conspirator Carl Chianese. The pills they distributed were stamped with markings that made them look similar to prescription opioid pills (Oxycodone or Percocet). Servidio and Chianese were also involved in the distribution of multiple-ounce quantities of crystal methamphetamine. Servidio and Chianese sold the pills and crystal methamphetamine on multiple occasions to an FBI undercover agent in exchange for cash payments. In total, Servidio was responsible for the distribution of over 200 grams of fentanyl and heroin and approximately 300 grams of crystal methamphetamine.

Chianese, 80, was sentenced by Judge Kugler in March 2020 to 10 years in prison and ordered to forfeit the firearm and United States currency, as part of the sentence imposed. Salvatore Piccolo, 68, another member of the Philadelphia LCN who sold crystal methamphetamine to the FBI undercover agent, was sentenced by Judge Kugler in November 2019 to 150 months in prison. 

In addition to the prison term, Judge Kugler sentenced Servidio to five years of supervised release.

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

The government is represented by Assistant U.S. Attorney Patrick C. Askin of the U.S. Attorney’s Office’s Camden Office.

NEWARK, N.J. – A South Carolina man today admitted defrauding at least 20 individuals by soliciting investments in what he claimed were highly successful, algorithm-based trading pools in foreign currency derivatives (“forex”) and other financial instruments, and then using the bulk of the money for personal expenditures and to pay off other victims, Attorney for the United States Rachael Honig announced.

Thomas Lanzana, 51, of Pawleys Island, South Carolina, and formerly of New Jersey, pleaded guilty by videoconference before U.S. District Judge John Michael Vazquez Count 1 of the indictment returned against him in August 2019, charging him with wire fraud.

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

Lanzana fraudulently solicited approximately $900,000 from at least 20 customers to invest in forex pools beginning as early as 2013. Lanzana misrepresented to prospective customers that he was a successful forex trader when, in fact, he was not. To keep his customers’ trust, Lanzana, among other things, (1) sent false account statements to his customers, (2) posted false monthly account statements to his companies’ websites showing balances and trading activity for forex trading accounts that did not exist, and (3) generated and sent false tax documents to customers reporting earnings that did not exist. Lanzana misappropriated approximately $350,000 in customer funds, using some to repay earlier investors in the manner of a Ponzi scheme, and to pay for his personal expenses, including purchases on Amazon.com, payments to a luxury car dealer and a jewelry retailer, and golf expenses. 

The count of wire fraud to which Lanzana pleaded guilty carries a maximum potential penalty of 20 years in prison and a fine of $250,000, or twice the pecuniary gain to the defendant or loss to the victims. Sentencing is scheduled for Feb. 23, 2021.

Attorney for the United States Honig credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr., and special agents of IRS-Criminal Investigation, under the direction of Michael Montanez, with the investigation leading to today’s guilty plea. He also thanked the U.S. Commodity Futures Trading Commission’s Division of Enforcement for its role in the investigation.

The government is represented by Assistant U.S. Attorney Anthony P. Torntore, of the U.S. Attorney’s Office’s Cybercrime Unit.

TRENTON, N.J. – A Monmouth County, New Jersey, man today admitted to being a felon in possession of a firearm, U.S. Attorney Craig Carpenito announced.

Jakim Stradford, 27, of Neptune City, New Jersey, pleaded guilty by videoconference before Chief U.S. District Judge Freda L. Wolfson to an indictment charging him with one count of being a felon in possession of a firearm.

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

On Feb. 26, 2020, officers from the Neptune City Police Department responded to the home of a local resident who reported trespassers in her patio. Officers found Stradford – a convicted felon prohibited from possessing a firearm – and another man in the enclosed patio of an apartment. The officers ordered the men to stop, but Stradford attempted to run. Officers arrested and searched Stradford, finding marijuana, pills and a Hi-Point 9mm caliber pistol. Examination of the pistol revealed that the serial number had been obliterated.

The felon in possession of a firearm charge carries a maximum potential penalty of 10 years in prison and a $250,000 fine. Sentencing is scheduled for Feb. 25, 2021.

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.

U.S. Attorney Carpenito credited special agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Charlie J. Patterson, Newark Field Division, Trenton Field Office, with the investigation leading to today’s guilty plea. He also thanked the Monmouth County Prosecutor’s Office, under the direction of Prosecutor Christopher J. Gramiccioni, and the Neptune City Police Department, under the direction of Chief Matthew Quagliato for their assistance with the investigation.

The government is represented by Special Assistant U.S. Attorney Christopher Matthews of the Criminal Division in Trenton.

NEWARK, N.J. – A Union County, New Jersey, man has been charged with conspiring to use drones to smuggle contraband, including tobacco, cell phone chargers, and a cell phone, into the federal correctional facility at Fort Dix, U.S. Attorney Craig Carpenito announced today.

Johansel Moronta, 27, of Linden, New Jersey, an inmate at Fort Dix from April 2018 to March 2019, was charged by complaint, unsealed today, with one count of conspiring to smuggle contraband into the prison and to defraud the United States and one count of being a federal inmate possessing and obtaining, and attempting to possess and obtain, contraband. Moronta will be scheduled to appear on a date to be determined by the court.

Three other men, Adrian Goolcharran, a/k/a “Adrian Ahoda” and “Adrian Ajoda,” Nicolo Denichilo, and Jason Arteaga Loayza, a/k/a “Juice,” previously have been charged with participating in the scheme to use drones to smuggle contraband into Fort Dix.

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

The U.S. Department of Justice, Office of Inspector General (DOJ-OIG) obtained evidence that in October 2018, while incarcerated at the federal prison at Fort Dix, Moronta participated, along with Arteaga, a former Fort Dix inmate, Goolcharran, and others, in a scheme to use unmanned aircrafts, or drones, to deliver contraband to inmates. Moronta’s role in the scheme was to coordinate the drone drops with Goolcharran and Arteaga from within the prison, and then retrieve the contraband after the drone, piloted by Goolcharran, had dropped the contraband inside the facility.

On Oct. 30, 2018, at approximately 1:40 a.m., Fort Dix officers observed a drone with fishing line hovering above the rooftop of an inmate housing unit. Officers found Moronta leaving a bathroom in the area where the bag of contraband dropped from the drone had been found, along with bolts that secured an open rooftop hatch used to access the delivery. Officers also found a cell phone that Moronta used to coordinate drone drops with Arteaga and Goolcharran. The phone contained numerous text messages and phone calls exchanged between Moronta, Goolcharran and Arteaga in the days leading up to the drop. On Oct. 27, 2018, Moronta sent a text message to Goolcharran referring to himself as “Joe [expletive] in fort dix on the rooftop.” On Oct. 30, 2018, at 12:07 a.m., Moronta sent a text message to Goolcharran asking “U in the area,” and Goolcharran responded “Yea.,” likely meaning that Goolcharran was near Fort Dix and available to make the drone drop. At 12:36 a.m., Goolcharran messaged Moronta “How we lookin,” and Moronta responded a few minutes later with “It ok.” Moronta also sent messages to Arteaga at 12:57 a.m., stating “Two trip,” likely referring to the number of drone flights planned, and “Same cop from last week,” likely referring to the corrections officer on duty.

Moronta also coordinated other drone drops with Arteaga and Goolcharran. Location data from Goolcharran’s cell phone confirmed that Goolcharran’s cell phone was in the Fort Dix area during the early morning hours of October 24, 2018, and began to depart the area by about 1:54 a.m. that same morning. In addition, evidence obtained from Moronta’s cell phone revealed numerous communications between Moronta, Arteaga, and Goolcharran on Oct. 23 and Oct. 24, 2018, showing the three men coordinating multiple drone drops.

The offenses charged in the complaint carry a maximum penalty of five years in prison and maximum fine of $250,000 for the conspiracy count and one year in prison and $100,000 maximum fine for the possessing or obtaining contraband count. 

U.S. Attorney Carpenito credited agents of DOJ-OIG, New York Field Office, under the direction of Special Agent in Charge Guido Modano; DOJ-OIG’s Cyber Investigations Office, under the direction of Special Agent in Charge Keith Bonanno; the U.S. Air Force Office of Special Investigations, Detachment 307 under the direction of Superintendent Jonathan Jackson; and the U.S. Department of Transportation – Office of Inspector General, Northeast Region, under the direction of Special Agent in Charge Douglas Shoemaker, with the investigation leading to the charges.

He also thanked Federal Bureau of Prisons personnel at Fort Dix, under the direction of Warden David Ortiz; agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr.; investigating agents of the U.S. Attorney’s Office, under the direction of Supervisory Special Agent Thomas J. Mahoney; and officers with the Pemberton Borough Police Department, under the direction of Chief Edward Hunter; the Pemberton Township Police Department, under the direction of Chief David Jantas; and Chesterfield Township Police Department, under the direction of Chief Kyle Wilson, for their assistance.

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

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

TRENTON, N.J. – An alleged crime family associate today admitted possessing cocaine with the intent to distribute, U.S. Attorney Craig Carpenito announced.

Jason Vella, 39, of Toms River, New Jersey, 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. 

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

The charge of possession of cocaine with intent to distribute is punishable by a maximum of 20 years in prison and a $250,000 fine. Sentencing is scheduled for Feb. 26, 2021.

U.S. Attorney Carpenito 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 guilty plea.

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.

NEWARK, N.J. – A Bronx, New York, man was sentenced today to 60 months in prison for conspiring to distribute 500 grams or more of cocaine, U.S. Attorney Craig Carpenito announced.

Steven Justo, 33, previously pleaded guilty before U.S. District Judge Susan D. Wigenton in Newark federal court to an information charging him with one count of conspiracy to distribute and possess with the intent to distribute 500 grams or more of cocaine. Judge Wigenton imposed the sentence today in Newark federal court.

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

In August 2019, Justo conspired with others to distribute cocaine in New Jersey. Justo and a conspirator travelled from the Bronx into Bergen County, New Jersey, to deliver approximately two kilograms of cocaine before being identified and arrested by agents with the U.S. Drug Enforcement Administration.

In addition to the prison term, Judge Wigenton sentenced Justo to four years of supervised release.  

U.S. Attorney Carpenito credited special agents with the U.S. Drug Enforcement Administration, under the direction of Special Agent in Charge Susan A. Gibson in Newark, with the investigation leading to today’s sentencing.

The government is represented by Assistant U.S. Attorney Shawn Barnes of the U.S. Attorney’s Office Criminal Division in Newark.

NEWARK, N.J. – A Passaic County, New Jersey, man is scheduled to make his initial appearance today after being charged with possession of child pornography, U.S. Attorney Craig Carpenito announced.

Robert Klemt, 34, of Wayne, New Jersey, is charged by complaint with one count of possession of child pornography. He is scheduled to make his initial appearance this afternoon by videoconference before U.S. Magistrate Judge James B. Clark III.

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

In June 2020, agents with the U.S. Department of Homeland Security – Homeland Security Investigations, approached Klemt at his residence after receiving information suggesting that Klemt had accessed a website containing child pornography. Law enforcement subsequently discovered over 70 images and videos depicting the sexual exploitation of children on Klemt’s laptop computer.

Klemt was previously convicted of endangering the welfare of a child/distribution of child pornography in Essex County in 2014. The charge of possession of child pornography, for a repeat offender, carries a mandatory minimum of 10 years in prison, a maximum of 20 years in prison, and a $250,000 fine.

U.S. Attorney Carpenito credited special agents with HSI, under the direction of Special Agent in Charge Jason J. Molina, with the investigation leading to the charges.

The government is represented by Assistant U.S. Attorney Shawn Barnes of the U.S. Attorney’s Office Criminal Division in Newark.

NEWARK, N.J. – A Newark man made his initial appearance today on charges of engaging in fraud by illegally obtaining unemployment insurance benefits, U.S. Attorney Craig Carpenito announced today.

Jefferson Robert, 30, was arrested on Oct. 20, 2020, by inspectors of the U.S. Postal Inspection Service and special agents of the U.S. Department of Labor, Office of Inspector General, and the FBI. He is charged by complaint with one count of wire fraud and appeared by videoconference for his initial appearance today before U.S. Magistrate Judge James B. Clark III.

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

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was signed into law. The CARES Act created a new temporary federal unemployment insurance program called Pandemic Unemployment Assistance (PUA), which provided unemployment insurance benefits for individuals who were not eligible for other types of unemployment (e.g., self-employed, independent contractors, gig economy workers). The CARES Act also created a new temporary federal program called Federal Pandemic Unemployment Assistance (FPUC) that provided an additional $600 weekly benefit to those eligible for PUA and regular unemployment insurance benefits.  The Washington State Employment Security Department (ESD) administered and managed the regular unemployment and PUA programs in the State of Washington.

On Aug. 6, 2019, Robert opened a bank account at Bank 1 in the name of “Johny Eto” using a fake United Kingdom passport. On May 8, 2020, an application was made to ESD for unemployment benefits in the name of an individual (Victim 1) using Victim 1’s personal identification information. On May 12, 2020, pursuant to instructions by the individual purporting to be Victim 1, the State of Washington sent a wire transfer into a bank account in the amount of $7,930.

This bank account received additional funds from a Business Enterprise Compromise scheme as well as IRS payments resulting from fraudulent activity. Between March 11, 2020, and May 1, 2020, a debit card associated with the bank account was used to purchase approximately 57 U.S. Postal Service money orders totaling $52,000. The “from” information on most of the money orders listed the name “Jefferson Robert” and an address in Newark. Records from New Jersey Motor Vehicle Commission reflect that Robert provided that address when obtaining a driver’s license.

Robert also used the fraudulent UK passport to open bank accounts at three other banks. These accounts were all frozen or closed due to suspicious activity. For example, on Sept. 19, 2019, a check payable to “Johny Eto” in the amount of $27,400 was deposited into one of those bank accounts. The check was drawn on an account in the name of an individual, who stated that he  did not open the account and does not know either Johny Eto or Robert.

Robert and his conspirators caused losses of more than $500,000.

U.S. Attorney Carpenito credited inspectors of the United States Postal Inspection Service, under the direction of Acting Inspector in Charge Raimundo Marrero, in Newark; special agents of the U.S. Department of Labor, Office of Inspector General, under the direction of Special Agent in Charge Michael C. Mikulka, in New York, 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 today’s arrest.

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

Please report COVID-19 fraud, hoarding or price-gouging to the National Center for Disaster Fraud’s National Hotline at (866) 720-5721, or e-mail: [email protected].

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

Today, the Department of Justice announced a global resolution of its criminal and civil investigations into the opioid manufacturer Purdue Pharma LP (Purdue), and a civil resolution of its civil investigation into individual shareholders from the Sackler family.  The resolutions with Purdue are subject to the approval of the bankruptcy court. 

“The abuse and diversion of prescription opioids has contributed to a national tragedy of addiction and deaths, in addition to those caused by illicit street opioids,” said Deputy Attorney General Jeffrey A. Rosen.  “With criminal guilty pleas, a federal settlement of more than $8 billion, and the dissolution of a company and repurposing its assets entirely for the public’s benefit, the resolution in today’s announcement re-affirms that the Department of Justice will not relent in its multi-pronged efforts to combat the opioids crisis.”

“Today’s resolution is the result of years of hard work by the FBI and its partners to combat the opioid crisis in the U.S.,” said Steven M. D’Antuono, Assistant Director in Charge of the FBI Washington Field Office.  “Purdue, through greed and violation of the law, prioritized money over the health and well-being of patients.  The FBI remains committed to holding companies accountable for their illegal and inexcusable activity and to seeking justice, on behalf of the victims, for those who contributed to the opioid crisis.”

“The opioid epidemic remains a significant public health challenge that impacts the lives of men and women across the country,” said Gary L. Cantrell Deputy Inspector General for Investigations at the U.S. Department of Health and Human Services’ Office of Inspector General.  “Unfortunately, Purdue’s reckless actions and violation of the law senselessly risked patients’ health and well-being.  With our law enforcement partners, we will continue to combat the opioid crisis, including holding the pharmaceutical industry and its executives accountable.”

“This resolution closes a particularly sad chapter in the ongoing battle against opioid addiction,” said Drug Enforcement Administration (DEA) Assistant Administrator Tim McDermott.  “Purdue Pharma actively thwarted the United States’ efforts to ensure compliance and prevent diversion.  The devastating ripple effect of Purdue’s actions left lives lost and others addicted.  DEA will continue to work tirelessly with our partners and the pharmaceutical industry to address the damage that has been done, and bring an end to this epidemic that has gripped the nation for far too long.” 

Purdue Pharma has agreed to plead guilty in federal court in New Jersey to a three-count felony information charging it with one count of dual-object conspiracy to defraud the United States and to violate the Food, Drug, and Cosmetic Act, and two counts of conspiracy to violate the Federal Anti-Kickback Statute.  The criminal resolution includes the largest penalties ever levied against a pharmaceutical manufacturer, including a criminal fine of $3.544 billion and an additional $2 billion in criminal forfeiture.  For the $2 billion forfeiture, the company will pay $225 million on the effective date of the bankruptcy, and, as further explained below, the department is willing to credit the value conferred by the company to State and local governments under the department’s anti-piling on and coordination policy.  Purdue has also agreed to a civil settlement in the amount of $2.8 billion to resolve its civil liability under the False Claims Act.  Separately, the Sackler family has agreed to pay $225 million in damages to resolve its civil False Claims Act liability.

The resolutions do not include the criminal release of any individuals, including members of the Sackler family, nor are any of the company’s executives or employees receiving civil releases.

While the global resolution with the company is subject to approval by the bankruptcy court in the Southern District of New York, one important condition in the resolution is that the company would cease to operate in its current form and would instead emerge from bankruptcy as a public benefit company (PBC) owned by a trust or similar entity designed for the benefit of the American public, to function entirely in the public interest.  Indeed, not only will the PBC endeavor to deliver legitimate prescription drugs in a manner as safe as possible, but it will aim to donate, or provide steep discounts for, life-saving overdose rescue drugs and medically assisted treatment medications to communities, and the proceeds of the trust will be directed toward State and local opioid abatement programs.  Based on the value that would be conferred to State and local governments through the PBC, the department is willing to credit up to $1.775 billion against the agreed $2 billion forfeiture amount.  The department looks forward to working with the creditor groups in the bankruptcy in charting the path forward for this PBC so that its public health goals can be best accomplished.

The Criminal Pleas

As part of the plea, Purdue will admit that from May 2007 through at least March 2017, Purdue conspired to defraud the United States by impeding the lawful function of the DEA by representing to the DEA that Purdue maintained an effective anti-diversion program when, in fact, Purdue continued to market its opioid products to more than 100 health care providers whom the company had good reason to believe were diverting opioids and by reporting misleading information to the DEA to boost Purdue’s manufacturing quotas.  The misleading information comprised prescription data that included prescriptions written by doctors that Purdue had good reason to believe were engaged in diversion.  The conspiracy also involved aiding and abetting violations of the Food, Drug, and Cosmetic Act by facilitating the dispensing of its opioid products, including OxyContin, without a legitimate medical purpose, and thus without lawful prescriptions.

In addition, Purdue will admit to conspiring to violate the Federal Anti-Kickback Statute.  Between June 2009 and March 2017, Purdue made payments to two doctors through Purdue’s doctor speaker program to induce those doctors to write more prescriptions of Purdue’s opioid products.  Similarly, from approximately April 2016 through December 2016, Purdue made payments to Practice Fusion Inc., an electronic health records company, in exchange for referring, recommending, and arranging for the ordering of Purdue’s extended release opioid products – OxyContin, Butrans, and Hysingla.

The Civil Settlements

The department’s civil settlements resolve the United States’ claims as to both Purdue and its individual shareholders, members of the Sackler family.

The civil settlement with Purdue provides the United States with an allowed, unsubordinated, general unsecured bankruptcy claim for recovery of $2.8 billion.   This settlement resolves allegations that from 2010 to 2018, Purdue caused false claims to be submitted to federal health care programs, specifically Medicare, Medicaid, TRICARE, the Federal Employees Health Benefits Program, and the Indian Health Service.  The government alleged that Purdue promoted its opioid drugs to health care providers it knew were prescribing opioids for uses that were unsafe, ineffective, and medically unnecessary, and that often led to abuse and diversion.  For example, Purdue learned that one doctor was known by patients as “the Candyman” and was prescribing “crazy dosing of OxyContin,” yet Purdue had sales representatives meet with the doctor more than 300 times.  It also resolves the government’s allegations that Purdue engaged in three different kickback schemes to induce prescriptions of its opioids.  First, Purdue paid certain doctors ostensibly to provide educational talks to other health care professionals and serve as consultants, but in reality to induce them to prescribe more OxyContin.  Second, Purdue paid kickbacks to Practice Fusion, as described above.  Third, Purdue entered into contracts with certain specialty pharmacies to fill prescriptions for Purdue’s opioid drugs that other pharmacies had rejected as potentially lacking medical necessity.

Under a separate civil settlement, individual members of the Sackler family will pay the United States $225 million arising from the alleged conduct of Dr. Richard Sackler, David Sackler, Mortimer D.A. Sackler, Dr. Kathe Sackler, and Jonathan Sackler (the Named Sacklers).  This settlement resolves allegations that, in 2012, the Named Sacklers knew that the legitimate market for Purdue’s opioids had contracted.  Nevertheless, they requested that Purdue executives recapture lost sales and increase Purdue’s share of the opioid market.  The Named Sacklers then approved a new marketing program beginning in 2013 called “Evolve to Excellence,” through which Purdue sales representatives intensified their marketing of OxyContin to extreme, high-volume prescribers who were already writing “25 times as many OxyContin scripts” as their peers, causing health care providers to prescribe opioids for uses that were unsafe, ineffective, and medically unnecessary, and that often led to abuse and diversion.     

The civil settlement also resolves the government’s allegations that from approximately 2008 to 2018, at the Named Sacklers’ request, Purdue transferred assets into Sackler family holding companies and trusts that were made to hinder future creditors, and/or were otherwise voidable as fraudulent transfers.

Today’s resolution does not resolve claims that states may have against Purdue or members of the Sackler family, nor does it impede the debtors’ ability to recover any fraudulent transfers.

Today’s announcement was made by Deputy Attorney General Jeffrey A. Rosen; Acting Assistant Attorney General of the Civil Division Jeffrey Clark; U.S. Attorney for the District of Vermont Christina Nolan; and First Assistant U.S. Attorney for the District of New Jersey Rachael Honig.  The criminal investigation was conducted by the U.S. Attorney’s Offices for the Districts of New Jersey and Vermont, the Consumer Protection Branch of the Department of Justice’s Civil Division, and the FBI’s Washington, D.C. and Newark Field Offices, with assistance by the DEA and the U.S. Attorney’s Office for the Northern District of Ohio.  The civil settlements were handled by the Fraud Section of the Commercial Litigation Branch of the Department of Justice’s Civil Division, and the U.S. Attorney’s Offices for the Districts of New Jersey and Vermont, with assistance from the Department of Health and Human Services, Office of General Counsel and Office of Counsel to the Inspector General; the Defense Health Agency; and the Office of Personnel Management.  The Purdue bankruptcy matter is being handled by the U.S. Attorney’s Office for the Southern District of New York and the Civil Division’s Commercial Litigation Branch, Corporate/Finance Section.

Except to the extent of Purdue’s admissions as part of its criminal resolution, the claims resolved by the civil settlements are allegations only.  There has been no determination of liability in the civil matters.

NEWARK, N.J. – Today, the Department of Justice announced a global resolution of its criminal and civil investigations into the opioid manufacturer Purdue Pharma LP (Purdue) and a civil resolution of its civil investigation into individual shareholders from the Sackler family.  The resolutions with Purdue are subject to the approval of the bankruptcy court. 

“For years, Purdue placed profits over patient safety by marketing and selling its dangerous opioid products to healthcare providers that it had good reason to believe were diverting those opioids to abusers,” Attorney for the United States Rachael A. Honig, District of New Jersey, said. “Purdue deceived the DEA about its measures to prevent such diversion, and it used that deception to gain higher limits on the amount of its products it was legally permitted to sell. Purdue also paid kickbacks to providers to encourage them to prescribe even more of Purdue’s products. Purdue is in bankruptcy now, but it still must be held responsible for these actions. The resolution we announce today does just that.” 

“The abuse and diversion of prescription opioids has contributed to a national tragedy of addiction and deaths, in addition to those caused by illicit street opioids,” Deputy Attorney General Jeffrey A. Rosen said. “With criminal guilty pleas, a federal settlement of more than $8 billion, and the dissolution of a company and repurposing its assets entirely for the public’s benefit, the resolution in today’s announcement re-affirms that the Department of Justice will not relent in its multi-pronged efforts to combat the opioids crisis.”

“Purdue’s expansive criminal conduct included paying a kickback in exchange for designing medical software to influence unwitting physicians,” Christina E. Nolan, United States Attorney for the District of Vermont, said. “Purdue’s drug marketers paid to invade the sanctity of the physician-patient relationship so that it could influence medical decisions and increase prescriptions of its most potent opioids. As it is now prepared to plead guilty for a second time to conduct involving unlawful marketing of highly addictive opioid pills, this resolution will serve as a reminder that the company put profits before people during the height of the opioid crisis.”

Purdue Pharma has agreed to plead guilty in federal court in New Jersey to a three-count felony information charging it with one count of dual-object conspiracy to defraud the United States and to violate the Food, Drug, and Cosmetic Act, and two counts of conspiracy to violate the Federal Anti-Kickback Statute. The criminal resolution includes the largest penalties ever levied against a pharmaceutical manufacturer, including a criminal fine of $3.544 billion and an additional $2 billion in criminal forfeiture. For the $2 billion forfeiture, the company will pay $225 million on the effective date of the bankruptcy, and, as further explained below, the Department is willing to credit the value conferred by the company to State and local governments under the Department’s anti-piling on and coordination policy. Purdue has also agreed to a civil settlement in the amount of $2.8 billion to resolve its civil liability under the False Claims Act. Separately, the Sackler family has agreed to pay $225 million in damages to resolve its civil False Claims Act liability.

The resolutions do not include the criminal release of any individuals, including members of the Sackler family, nor are any of the company’s executives or employees receiving civil releases.

While the global resolution with the company is subject to approval by the bankruptcy court in the Southern District of New York, one important condition in the resolution is that the company would cease to operate in its current form and would instead emerge from bankruptcy as a public benefit company (PBC) owned by a trust or similar entity designed for the benefit of the American public, to function entirely in the public interest. Indeed, not only will the PBC endeavor to deliver legitimate prescription drugs in a manner as safe as possible, but it will aim to donate, or provide steep discounts for, life-saving overdose rescue drugs and medically assisted treatment medications to communities, and the proceeds of the trust will be directed toward State and local opioid abatement programs. Based on the value that would be conferred to State and local governments through the PBC, the Department is willing to credit up to $1.775 billion against the agreed $2 billion forfeiture amount. The Department looks forward to working with the creditor groups in the bankruptcy in charting the path forward for this PBC so that its public health goals can be best accomplished.

The Criminal Pleas

As part of the plea, Purdue will admit that from May 2007 through at least March 2017, Purdue conspired to defraud the United States by impeding the lawful function of the Drug Enforcement Administration (DEA) by representing to the DEA that Purdue maintained an effective anti-diversion program when, in fact, Purdue continued to market its opioid products to more than 100 health care providers whom the company had good reason to believe were diverting opioids and by reporting misleading information to the DEA to boost Purdue’s manufacturing quotas. The misleading information comprised prescription data that included prescriptions written by doctors that Purdue had good reason to believe were engaged in diversion. The conspiracy also involved aiding and abetting violations of the Food, Drug, and Cosmetic Act by facilitating the dispensing of its opioid products, including OxyContin, without a legitimate medical purpose, and thus without lawful prescriptions.

In addition, Purdue will admit to conspiring to violate the Federal Anti-Kickback Statute. Between June 2009 and March 2017, Purdue made payments to two doctors through Purdue’s doctor speaker program to induce those doctors to write more prescriptions of Purdue’s opioid products. Similarly, from approximately April 2016 through December 2016, Purdue made payments to Practice Fusion Inc., an electronic health records company, in exchange for referring, recommending, and arranging for the ordering of Purdue’s extended release opioid products – OxyContin, Butrans, and Hysingla.

The Civil Settlements

The Department’s civil settlements resolve the United States’ claims as to both Purdue and its individual shareholders, members of the Sackler family.

The civil settlement with Purdue provides the United States with an allowed, unsubordinated, general unsecured bankruptcy claim for recovery of $2.8 billion. This settlement resolves allegations that from 2010 to 2018, Purdue caused false claims to be submitted to federal health care programs, specifically Medicare, Medicaid, TRICARE, the Federal Employees Health Benefits Program, and the Indian Health Service. The government alleged that Purdue promoted its opioid drugs to health care providers it knew were prescribing opioids for uses that were unsafe, ineffective, and medically unnecessary, and that often led to abuse and diversion. For example, Purdue learned that one doctor was known by patients as “the Candyman” and was prescribing “crazy dosing of OxyContin,” yet Purdue had sales representatives meet with the doctor more than 300 times. It also resolves the government’s allegations that Purdue engaged in three different kickback schemes to induce prescriptions of its opioids. First, Purdue paid certain doctors ostensibly to provide educational talks to other health care professionals and serve as consultants, but in reality to induce them to prescribe more OxyContin. Second, Purdue paid kickbacks to Practice Fusion, as described above. Third, Purdue entered into contracts with certain specialty pharmacies to fill prescriptions for Purdue’s opioid drugs that other pharmacies had rejected as potentially lacking medical necessity.

Under a separate civil settlement, individual members of the Sackler family will pay the United States $225 million arising from the alleged conduct of Dr. Richard Sackler, David Sackler, Mortimer D.A. Sackler, Dr. Kathe Sackler, and Jonathan Sackler (the Named Sacklers).  This settlement resolves allegations that, in 2012, the Named Sacklers knew that the legitimate market for Purdue’s opioids had contracted. Nevertheless, they requested that Purdue executives recapture lost sales and increase Purdue’s share of the opioid market. The Named Sacklers then approved a new marketing program beginning in 2013 called “Evolve to Excellence,” through which Purdue sales representatives intensified their marketing of OxyContin to extreme, high-volume prescribers who were already writing “25 times as many OxyContin scripts” as their peers, causing health care providers to prescribe opioids for uses that were unsafe, ineffective, and medically unnecessary, and that often led to abuse and diversion.    

The civil settlement also resolves the government’s allegations that from approximately 2008 to 2018, at the Named Sacklers’ request, Purdue transferred assets into Sackler family holding companies and trusts that were made to hinder future creditors, and/or were otherwise voidable as fraudulent transfers.

Today’s resolution does not resolve claims that States may have against Purdue or members of the Sackler family, nor does it impede the Debtors’ ability to recover any fraudulent transfers.

Today’s announcement was made by Deputy Attorney General Rosen; Acting Assistant Attorney General of the Civil Division Clark; United States Attorney for the District of Vermont Nolan; and First Assistant U.S. Attorney for the District of New Jersey Honig. The criminal investigation was conducted by the United States Attorney’s Offices for the Districts of New Jersey and Vermont, the Consumer Protection Branch of the Department of Justice’s Civil Division, and the Federal Bureau of Investigation’s Washington, DC and Newark Field Offices, with assistance by DEA. The civil settlements were handled by the Fraud Section of the Commercial Litigation Branch of the Department of Justice’s Civil Division, and the United States Attorney’s Offices for the Districts of New Jersey and Vermont, with assistance from the Department of Health and Human Services, Office of General Counsel and Office of Counsel to the Inspector General; the Defense Health Agency; and the Office of Personnel Management.  The Purdue bankruptcy matter is being handled by the United States Attorney’s Office for the Southern District of New York and the Civil Division’s Commercial Litigation Branch, Corporate/Finance Section.

The government is represented in the District of New Jersey by Deputy Chief of the Criminal Division Nicholas Grippo, Chief of the Health Care Fraud Unit Lee M. Cortes Jr., Chief of the Opioids Unit Melissa Wangenheim, and assistant U.S. Attorneys Stephen Ferketic, Sean Sherman, Marihug P. Cedeño and Nicole Mastropieri.

Except to the extent of Purdue’s admissions as part of its criminal resolution, the claims resolved by the civil settlements are allegations only. There has been no determination of liability in the civil matters.