District of New Jersey
Press releases recorded for this federal judicial district.
Investment Adviser Arrested for Stealing Millions from ClientsRead the Press Release
NEWARK, N.J. – A former broker and investment adviser was arrested today for allegedly stealing more than $2.1 million from two clients in order to pay for personal expenses, U.S. Attorney Craig Carpenito announced.
Gary Basralian, 70, of Springfield, New Jersey, is charged by complaint with two counts of wire fraud and one count of investment adviser fraud. Basralian was arrested earlier today at his home and is scheduled to appear this afternoon before U.S. Magistrate Judge U.S. Magistrate Judge Steven C. Mannion in Newark federal court.
According to the complaint:
From 1989 through December 2017, Basralian was registered with an investment adviser and broker dealer referred to in the complaint as “Securities Firm A.”
From August 2007 through November 2017, Basralian, while serving in his capacity as an investment adviser, misappropriated at least $738,000 from a client identified in the complaint as “Victim 1” and at least $1.4 million from a client identified in the complaint as “Victim 2.”
Basralian said he would invest these funds in brokerage accounts at Securities Firm A or in real estate and high-interest loans, and manage them on behalf of the victims. However, Basralian used the victims’ money to fund his own personal expenditures, including BMW payments and tens of thousands of dollars in credit card bills.
Victim 1 routinely provided funds to investment accounts managed by Basralian at Securities Firm A. At Basralian’s direction, Victim 1 eventually began addressing checks to “Masters Financial” based on Basralian‘s representations that the checks would ultimately be deposited into her investment accounts at Securities Firm A. Instead, the funds were deposited into an account controlled by Basralian, which he used for personal expenses.
In 2009, Basralian began wiring funds from Victim 2’s investment account at Securities Firm A into various accounts that he controlled and used the proceeds for his own benefit. When Victim 2 asked why her account at Securities Firm A had diminished in value, Basralian sent her a phony spreadsheet showing that her money was being invested as loans to various companies that would be paid back with interest.
Each of the wire fraud counts carries a maximum potential penalty of 20 years in prison and $250,000 fine, or twice the gross gain or loss from the offense. The investment adviser fraud count carries a maximum potential penalty of five years in prison and a $10,000 fine, or twice the gross gain or loss from the offense.
On May 22, 2018, the New Jersey Bureau of Securities, within the Office of the New Jersey Attorney General, issued a Summary Revocation Order against Basralian that revoked his agent and investment adviser representative registrations.
U.S. Attorney Carpenito credited postal inspectors of the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Ruth M. Mendonca, and Special Agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie, with the investigation leading to today’s charges. He also thanked the New Jersey Bureau of Securities, under the direction of Bureau Chief Christopher Gerold, for its assistance.
The government is represented by Assistant U.S. Attorney Courtney Howard of the U.S. Attorney’s Office Economic Crimes Unit.
The charges and allegations in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Former Chief Financial Officer of New Jersey Orthopedic Care Provider Sentenced to Two Years in Prison for Embezzling More Than $1 MillionRead the Press Release
NEWARK, N.J. – The former chief financial officer of a New Jersey orthopedic care provider was sentenced today to 24 months in prison for stealing more than $1 million from the company for his personal use, U.S. Attorney Craig Carpenito announced.
Harry Wolfmuller, 70, formerly of Belmar, New Jersey, previously pleaded guilty before U.S. District Judge Claire C. Cecchi to an information charging him with one count of wire fraud. Judge Cecchi imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
From 2007 through 2015, Wolfmuller was employed as the chief financial officer for “Company A,” an orthopedic care provider with offices in Ocean and Monmouth Counties. As such, Wolfmuller controlled Company A’s bank accounts and financial records.
Wolfmuller cashed checks from Company A’s business accounts to pay for unapproved personal expenses, including meals at restaurants, golf, gambling and lottery tickets. Wolfmuller then misrepresented the nature of these transactions in Company A’s accounting records to make them appear as legitimate business expenses. Altogether Company A lost approximately $1,175,720 as a result of Wolfmuller’s conduct.
In addition to the prison term, Judge Cecchi sentenced Wolfmuller to three years of supervised release and ordered him to pay restitution of $1,175,720.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, with the investigation leading to today’s sentencing.The government is represented by Assistant U.S. Attorneys Nicholas P. Grippo of the Economic Crimes Unit and Christopher Amore of the Asset Recovery and Money Laundering Unit in Newark.
Defense counsel: Salvatore T. Alfano Esq., Bloomfield, New Jersey, and Louis Esposito Esq., Cedar Grove, New Jersey
Five Defendants Charged with Defrauding Banks of over $2.5 Million with Credit Card ‘Bust Out’ SchemeRead the Press Release
NEWARK, N.J. – Five individuals were charged today with allegedly using stolen and altered identities to fraudulently obtain credit cards and make over $2.5 million in charges that were never repaid, U.S. Attorney Craig Carpenito announced.
Talat Ali Maan, 44, of Germantown, Maryland, Syed Rehman, 51, of Jersey City, New Jersey, Kashif Idrees, 36, of Germantown, Jaheed Wahed Ahmed, 54, of Jersey City, and Fatou Djambo, 37, of Philadelphia, are each charged by complaint with one count of conspiring to defraud financial institutions.
Rehman and Djambo were arrested this morning and are scheduled to appear this afternoon before U.S. Magistrate Judge Steven C. Mannion in Newark federal court. Maan was arrested in Maryland and will appear before a U.S. Magistrate Judge in the District of Maryland. Ahmed and Idrees remain at large.
According to the complaint:
The defendants engaged in a fraudulent scheme to use stolen and fraudulently altered identities to obtain credit cards from banks and then use those credit cards to make purchases that they had no intention to repay, leaving the banks to bear the losses of the scheme.
Specifically, the defendants stole the identities of actual people and then, in many cases, created “synthetic identities” by pairing the name and social security number for an actual person with a fictitious birth date. When creating the synthetic identities, the defendants often used the name and social security number of an actual minor and combined them with a fictitious birth date that made the identity appear to be that of an adult.
The defendants then used the stolen and synthetic identities to obtain lines of credit, primarily through opening credit card accounts at banks. These cards were maintained in good standing with the banks long enough to establish the creditworthiness of the stolen and synthetic identities. The defendants then “busted out” the cards by making large purchases and never repaying the debts associated with those purchases.
The defendants also incorporated and registered in various states numerous purported companies that did little or no legitimate business. The defendants obtained credit card processing equipment by opening merchant processing accounts in the names of these sham companies, and then used that equipment to make the charges on the fraudulent credit cards.
In addition, Rehman maintained a Jersey City convenience store located at the same address as a gas station. From time to time, the defendants used that business to make charges to the fraudulent cards. The defendants also used the fraudulent cards to purchase merchandise from a Secaucus, New Jersey, warehouse store that they then sold for a profit at the convenience store.
The defendants routinely used “drop addresses” in New Jersey, New York, Pennsylvania, and Maryland as the purported mailing addresses for the phony cards and the sham companies.
The charge of conspiring to defraud financial institutions carries a maximum penalty of 30 years in prison and a $1 million fine, or twice the gross gain or loss from the offense.
U.S. Attorney Carpenito credited special agents of the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Ruth Mendonca, with the investigation leading to today’s arrests.
The charge and allegations in the complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
The government is represented by First Assistant U.S. Attorney Rachael A. Honig.
Bergen County Man Sentenced to 65 Months in Prison for Robbery of New Jersey Bar, Carjacking, and Violent Kidnapping of Taxi DriverRead the Press Release
NEWARK, N.J. – A Bergen County, New Jersey, man was sentenced today to 65 months in prison for participating in the December 2015 robbery of a North Jersey bar and the violent carjacking and kidnapping that took place shortly afterwards, U.S. Attorney Craig Carpenito announced.
Wilbur Jonathon Barahona, 22, of Ridgewood, New Jersey, previously pleaded guilty before U.S. District Judge Jose L. Linares to a three-count information charging him with conspiracy to commit Hobbs Act Robbery, carjacking, and kidnapping. Judge Linares imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
Barahona admitted that on Dec. 25, 2015, he and others forcibly robbed a bar in Hawthorne, New Jersey, and subsequently fled with approximately $200 in cash.
In the early morning hours of Dec. 26, 2015, Barahona and others hailed a taxi in Paterson, New Jersey, and forcibly took the taxi from the driver. Barahona admitted that he and others forced the driver into the back of the vehicle and took over driving. Barahona also admitted that during the carjacking, other conspirators caused seriously bodily injury to the driver by hitting him in the head with a beer bottle and slicing his throat with a knife before eventually leaving him on the side of the road in New York. The taxicab driver survived.
In addition to the prison term, Judge Linares sentenced Barahona to five years of supervised release and fined $1,500.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, the Bergen County Prosecutor’s Office, under the direction of Acting Prosecutor Dennis Calo, and the Ridgewood and Hawthorne Police Departments, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorneys Elaine K. Lou and Karen D. Stringer of the U.S. Attorney’s Office’s Criminal Division in Newark.
Former Loan Officer Sentenced to 18 Months in Prison for Role in $6 Million Mortgage Fraud SchemeRead the Press Release
NEWARK, N.J. – A Jackson, New Jersey, man was sentenced today to 18 months in prison for his role in a large-scale mortgage fraud scheme that used phony documents and straw buyers to acquire more than $6 million in loans, U.S. Attorney Craig Carpenito announced.
Joseph DiValli previously pleaded guilty before U.S. District Judge Susan D. Wigenton to a superseding information charging him with one count of conspiracy to commit wire fraud, one count of wire fraud and one count of tax evasion. Judge Wigenton imposed the sentence today in Newark federal court.According to documents filed in this case and statements made in court:
From March 2011 through November 2012, DiValli and other conspirators agreed to fraudulently obtain mortgage loans for properties located in North Jersey. After recruiting “straw buyers” to purchase the properties, DiValli and others submitted false and fraudulent loan applications and supporting documents so the straw buyers could qualify for the loans. DiValli and others also used another conspirator, who worked at a bank, to create misleading certifications showing certain bank accounts held more money than they actually had. DiValli and other conspirators also submitted false appraisal reports, backdated deeds and used unlicensed title agents to close transactions and disburse the mortgage proceeds.
As a loan officer for a North Jersey mortgage lender, DiValli facilitated some of these fraudulent transactions, including a $244,855.26 mortgage on a property located on Smith Street in Elizabeth, New Jersey. Overall, the scheme induced lenders to issue more than $6 million in loans, resulting in several defaults and exposing lenders and the Federal Housing Administration (FHA) to more than $2 million in potential losses.
DiValli also admitted using a separate scheme to modify the mortgage on his personal residence. From March 2011 through June 2012, Divalli used false payroll ledgers and earnings statements to deceive a loan officer into believing that his net earnings were lower than his actual income level.
DiValli also admitted receiving income of more than $450,000 in 2012. In order to avoid taxes of $79,000, DiValli failed to file taxes for 2012 and cashed his paychecks at a check-cashing facility to conceal his income.
In addition to the prison term, Judge Wigenton sentenced DiValli to three years of supervised release and ordered to pay restitution of $2,322,045.
U .S. Attorney Carpenito credited law enforcement agents of the FBI Newark Mortgage Fraud Task Force, under the direction of Special Agent in Charge Gregory W. Ehrie; postal inspectors of the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Ruth M. Mendonca; special agents of the U.S. Department of Housing and Urban Development, Office of Inspector General, under the direction of Special Agent in Charge Christina Scaringi; special agents of the Federal Housing Finance Agency, Office of Inspector General, under the direction of Special Agent in Charge Steven Perez; special agents of the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), under the direction of Special Inspector General Christy Goldsmith Romero; special agents of IRS–Criminal Investigation, under the direction of Acting Special Agent in Charge Bryant Jackson; and the Hudson County Prosecutor’s Office, under the direction of Prosecutor Esther Suarez, for the investigation leading to today’s sentencing.The government is represented by Assistant U.S. Attorneys Lakshmi Srinivasan Herman of the National Security Unit, Andrew Kogan of the Cyber Unit, and Senior Litigation Counsel Barbara Ward of the Asset Recovery and Money Laundering Unit.
Defense counsel: Michael A. Koribanics Esq. Clifton, New Jersey
Middlesex County, New Jersey, Woman Admits Role in Credit Card Fraud and Aggravated Identity Theft ConspiracyRead the Press Release
TRENTON, N.J. – A Middlesex County, New Jersey, woman today admitted participating in a credit card fraud and aggravated identity theft conspiracy, U.S. Attorney Craig Carpenito announced.
Alexus Omowole, 22, of North Brunswick, New Jersey, pleaded guilty before U.S. District Judge Peter G. Sheridan in Trenton federal court to an information charging her with one count of conspiracy to commit bank fraud and one count of aggravated identity theft.
According to documents filed in this case and statements made in court:
From July 2017 to January 2018, Omowole and Henry Abdul, a conspirator who was charged by criminal complaint in January 2018 in connection with the scheme, participated in a conspiracy to obtain control of and use credit card accounts of others through a fraudulent scheme commonly referred to as a “credit card takeover” scheme. In a takeover scheme, a person who is not the account owner or authorized user of a credit card account contacts the financial institution and poses as the account owner in order to change the personal information associated with the account to information familiar to the unauthorized user. The information changed may include the residence, email address, or telephone number associated with the account. These changes to the account are designed to give the unauthorized user control of the account without the actual account owners’ knowledge or authorization, and may permit the unauthorized user to receive new credit cards associated with the compromised accounts. Once in control of the account, the unauthorized users make purchases, transfer funds to other accounts under the user’s control, or sell the account information to third parties.
Abdul’s residential address was used as part of the takeover conspiracy, and both Abdul and Omowole profited from the conspiracy by using several compromised credit cards at various retail locations in New Jersey and elsewhere. Omowole admitted that the scheme caused between $150,000 and $250,000 in losses, and involved more than 10 separate victims.
The bank fraud conspiracy charge carries a maximum potential penalty of up to 30 years in prison and a fine of up to $1 million. The aggravated identity theft charge carries a mandatory sentence of two years in prison, which must run consecutive to any other term of imprisonment imposed by the Court. Sentencing is scheduled for Sept. 10, 2018.
U.S. Attorney Carpenito credited special agents with the U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI), under the direction of Acting Special Agent in Charge Brian Michael in Newark, New Jersey; and the U.S. Postal Inspection Service under the direction of Acting Inspector in Charge Ruth M. Mendonca, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorneys Nicholas P. Grippo and David M. Eskew, Deputy Chief of the U.S. Attorney’s Office Criminal Division in Newark.
The charges and allegations against Abdul are merely accusations, and he is presumed innocent unless and until proven guilty
Defense counsel: Joseph Benedict Esq. New Brunswick, New Jersey
Monroe Township, New Jersey, Man Admits Possession of Child PornographyRead the Press Release
NEWARK, N.J. – A Middlesex County, New Jersey, man today admitted possessing images of child sexual abuse, U.S. Attorney Craig Carpenito announced.
Sam Cynamon, 67, of Monroe Township, New Jersey, and formerly of Springfield, New Jersey, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to an indictment charging him with one count of possession of child pornography.
According to documents filed in the case and statements made in court:
On July 10, 2017, law enforcement officers lawfully obtained multiple computers and electronic storage media belonging to Cynamon from his residence. The computers and electronic storage media contained multiple images and videos of child pornography, including images of prepubescent children being sexually abused.
In March 2005, Cynamon pleaded guilty in the District of New Jersey to possession of child pornography and was sentenced to 27 months in prison. Because of his prior conviction, the count of possession of child pornography to which Cynamon pleaded guilty today carries a mandatory minimum potential penalty of 10 years in prison, a maximum potential penalty of 20 years in prison, and a $250,000 fine. Sentencing is scheduled for Sept. 19. 2018.
U.S. Attorney Carpenito credited special agents with the Department of Homeland Security, Homeland Security Investigations, under the direction of Acting Special Agent in Charge Brian Michael in Newark, with the investigation leading to today’s guilty plea.
The government is represented by Danielle Alfonzo Walsman, Chief of the U.S. Attorney’s Office’s Public Protection Unit in Newark.
Defense counsel: Robert Degroot Esq., Newark
Five Former Salesmen for Morris County Clinical Lab Sentenced for Bribing Doctors in $100 Million Test Referral SchemeRead the Press Release
NEWARK, N.J. – Five individuals were sentenced today for bribing doctors in exchange for test referrals as part of a long-running and elaborate scheme operated by Biodiagnostic Laboratory Services LLC (BLS), of Parsippany, New Jersey, its president and numerous associates, U.S. Attorney Craig Carpenito announced.
Doug Hurley, 38, of Hillsborough, New Jersey, and Kevin Kerekes, 52, of Florham Park, New Jersey, were both sentenced to 24 months in prison. Luke Chicco, 45, of Garden City, New York, was sentenced to 21 months in prison. Kristina Hamdan, 40, of Paterson was sentenced to 41 months in prison. David McCann, 45, of Lyndhurst, New Jersey, was sentenced to three years of probation. U.S. District Judge Stanley R. Chesler imposed all five sentences today in Newark federal court.
Hurley, Kerekes, and Chicco previously pleaded guilty in June 2013 to separate informations charging them with one count of conspiracy to violate the Anti-Kickback Statute and the Federal Travel Act and one count of money laundering.
Hamdan pleaded guilty to Counts One and Thirteen of an indictment charging her with conspiracy to violate the Anti-Kickback Statute, the Federal Travel Act and the honest services wire fraud statute, and conspiracy to commit money laundering. McCann pleaded guilty to an information charging him with conspiring to violate the Anti-Kickback Statute and the Travel Act.
According to documents filed in this and related cases and statements made in court:Hurley, Kerekes, and Chicco each admitted that from the fall of 2010 through April 2013, they conspired with BLS president and part owner, David Nicoll and his brother, Scott Nicoll, to pay bribes to doctors in the forms of cash, checks and other means in order to induce them to refer patient blood specimens to BLS. Hurley, Kerekes, and Chicco also admitted that in some instances, they paid bribes to doctors through sham consulting companies, which they created and controlled, in order to hide the fact that BLS was the true source of the bribes.
Hamdan admitted that from November 2009 through April 2013, she paid doctors illegal bribes in exchange for blood specimen referrals to BLS. For example, Hamdan bribed Yousef Zibdie, an internal medicine doctor with a practice in Woodland Park, in exchange for generating more than $900,000 in lab business for BLS. The bribes were funded by BLS and, in an effort to obscure that BLS was the true source of the payments paid to the doctors by Hamdan, she made the payments through a sham consulting company that she created and controlled.
McCann paid thousands of dollars in cash on a monthly basis between December 2011 and April 2013 to numerous physicians on behalf of BLS in exchange for the doctors’ referral of blood specimens to BLS.
In addition to the prison term, Judge Chesler sentenced Hurley, Chicco, Kerekes, and Hamdan a year of supervised release. Hurley, Chicco, and Kerekes must also pay forfeiture of $800,000, $850,000, and $1.2 million, respectively. Hamdan must pay forfeiture of $1,209,890.36.
The investigation has thus far resulted in 53 convictions – 38 of them doctors – in connection with the bribery scheme, which its organizers have admitted involved millions of dollars in bribes and resulted in more than $100 million in payments to BLS from Medicare and various private insurance companies. It is believed to be the largest number of medical professionals ever prosecuted in a bribery case.
The investigation has to date recovered more than $13 million through forfeiture. On June 28, 2016, BLS, which is no longer operational, pleaded guilty and was required to forfeit all of its assets.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark; inspectors of the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Ruth M. Mendonca; IRS–Criminal Investigation, under the direction of Acting Special Agent in Charge Bryant Jackson in Newark; and the U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert, with the ongoing investigation.The government is represented by Senior Litigation Counsel Joseph N. Minish, Assistant U.S. Attorneys Danielle Alfonzo Walsman, Chief of the U.S. Attorney’s Office Public Protection Unit and Jacob T. Elberg, Chief of the Health Care and Government Fraud Unit, as well as Assistant U.S. Attorney Barbara Ward of the Asset Forfeiture and Money Laundering Unit.
Defense counsel:
Luke Chicco: Robert J. Anello Esq., New York
Doug Hurley: Michael Baldassare Esq., Newark
Kevin Kerekes: Nace Naumoski Esq., Roseland and Alan Bowman Esq., Newark
McCann: Benjamin Choi Esq. and Joseph Horn, Esq., Rutherford, New Jersey
Kristina Hamdan: Edward J. Bilinkas Esq., Randolph, New JerseyBergen County Man Charged with Illegally Obtaining NaturalizationRead the Press Release
NEWARK, N.J. – A River Edge, New Jersey, man was arrested today for allegedly concealing prior criminal activity involving sexual intercourse with a child on his naturalization application, U.S. Attorney Craig Carpenito announced.
Kyung Lim Park, a/k/a “Howard Kyung Lim Park,” 65, was arrested today and charged with knowingly procuring his own naturalization contrary to law by providing false information and concealing material facts. Park appeared this afternoon before U.S. Magistrate Judge Mark Falk and was released on $150,000 bond.
According to documents filed in this case and statements made in court:
On Oct. 13, 2011, Park, who lawfully entered the United States from South Korea in March 1998, completed a naturalization application to obtain U.S. Citizenship. Park was required to truthfully answer a question asking if he had ever committed a crime or offense for which he was not arrested. However, Park did not disclose that he had engaged in sexual intercourse with a child between December 2002 and April 2003.
After he received his citizenship, Park pleaded guilty in March 2016 in New Jersey Superior Court, Bergen County, to child endangerment and sexual conduct by a non-caretaker. During his plea hearing, Park admitted engaging in sexual intercourse with a child on at least three occasions between December 2002 and April 2003. He was later sentenced in October 2016 to five years’ probation, including community service for life and a requirement to register as a sex offender under Megan’s Law.
If convicted of the charge in today’s complaint, Park faces a maximum potential penalty of 10 years in prison, a $250,000 fine, and the possibility of losing his naturalization.
U.S. Attorney Carpenito credited special agents of Department of Homeland Security, Homeland Security Investigations, under the direction of Acting Special Agent in Charge Brian Michael, with the investigation.
The government is represented by Assistant U.S. Attorney Anthony Moscato, Chief of the U.S. Attorney’s Office National Security Unit in Newark.
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Defense counsel: K. Anthony Thomas Esq.
Former Owners of Paterson Restaurant Admit Tax EvasionRead the Press Release
NEWARK, N.J. – The former owners of a restaurant in Paterson, New Jersey, today admitted failing to pay over $240,000 in taxes by concealing income from their cash-only business, U.S. Attorney Craig Carpenito announced.
Elio Federico, 71, of Totowa, New Jersey, and his brother, Ralph Federico, 68, of Saddle Brook, New Jersey, each pleaded guilty before U.S. District Judge Susan D. Wigenton in Newark federal court to one count of tax evasion.
According to documents filed in this case and statements made in court:
Elio and Ralph Federico co-owned an Italian restaurant in Paterson that had been in business since 1967. The brothers operated the restaurant on a cash-only basis, paid a substantial portion of the employee payroll in cash, and paid virtually all of their suppliers in cash.
Elio and Ralph Federico admitted that they concealed a portion of their income from the IRS by among other things, taking a cash “skim” from the restaurant’s gross receipts, which they did not report as income; reprogramming the cash register so it would not maintain a gross receipt balance for more than a few days; and deliberately failing to provide the restaurant’s accountant with invoices that reflected the true cost of goods sold and the actual amount of gross income that the business generated.
Elio and Ralph Federico admitted that they failed to pay the necessary income and employment taxes that they owed from 2011 through 2014, resulting in a tax loss to the United States of $241,219.
The tax evasion charge to which they pleaded guilty carries a maximum potential penalty of five years in prison and a $250,000 fine. Sentencing is scheduled for Sept. 4, 2018.
U.S. Attorney Carpenito credited special agents of IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Bryant Jackson in Newark, with the investigation leading to today’s guilty pleas.
The government is represented by Assistant U.S. Attorney Bernard J. Cooney of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark.
Defense counsel:
Elio Federico: Frank Agostino Esq. and Jeffrey Dirmann Esq., Hackensack
Ralph Federico: Richard J. Sapinski Esq. and Joseph B. Shumofsky Esq. NewarkFormer CEO, CFO and Director of Health Care Services Company Charged in Elaborate $300 Million Investment Fraud SchemeRead the Press Release
The former CEO, CFO and an executive director of a publicly traded health care services company were charged today with allegedly orchestrating a widespread scheme to defraud investors and others out of hundreds of millions of dollars in connection with a merger transaction designed to convert the company into a private entity, Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division and U.S. Attorney Craig Carpenito announced today.
Parmjit “Paul” Parmar, 48, of Colts Neck, New Jersey; Sotirios “Sam” Zaharis, 51, of Weehawken, New Jersey; and Ravi Chivukula, 44, of Freehold, New Jersey, are charged by complaint with one count of conspiracy to commit securities fraud and one count of securities fraud. FBI special agents arrested Parmar earlier today near his home. He is scheduled to appear this afternoon before U.S. Magistrate Judge Leda Dunn Wettre in Newark, New Jersey federal court. Chivukula and Zaharis remain at large.
According to the complaint unsealed today, from May 2015 through September 2017, the defendants orchestrated an elaborate scheme to defraud a private investment firm and others out of hundreds of millions of dollars in connection with the funding of a transaction to take private a company (Company A) traded publicly on the London Stock Exchange’s Alternative Investment Market. To fund the transaction, the private investment firm put up approximately $82 million in equity, and a consortium of financial institutions provided another approximately $130 million in debt. The scheme allegedly utilized fraudulent methods to grossly inflate the value of Company A and trick others into believing that Company A was worth substantially more than its actual value.
The complaint alleges that to present a positive picture of the company’s financial wealth, the defendants allegedly sought to raise tens of millions of dollars in the public markets, purportedly to fund Company A’s acquisitions of various operating subsidiaries. In reality, a number of those entities either did not exist or had only a fraction of the operating income attributed to them. The conspirators allegedly funneled the proceeds of these secondary offerings through bank accounts they controlled and used the money for a variety of purposes that had nothing to do with acquiring the purported targets. The money was instead used to make it appear as if the operating subsidiary had substantial customer revenue when, in fact, the funds were simply transfers of the money that had been raised in the secondary offering. The defendants allegedly went to great lengths to make it appear that these funds were revenue, concocting phony customers and altering bank statements to make it appear as if the funds were coming from customers.
The conspirators allegedly:
- Created fictitious operating companies that Company A purportedly acquired in sham acquisitions;
- Falsified and fabricated bank records of subsidiary entities in order to generate a phony picture of Company A’s revenue streams;
- Generated fake income streams and phony customers of Company A and its subsidiaries; and
- Made material misrepresentations and omissions to the private investment firm and others.
The defendants’ alleged actions caused the private investment firm and others to value Company A at more than $300 million for purposes of financing the transaction to take the company private.
The alleged scheme was uncovered around September 2017, when the defendants resigned from their positions with Company A or were terminated. On March 16, 2018, Company A and numerous of its affiliated entities filed for bankruptcy, attributing the company’s financial demise, in large part, to the alleged fraud scheme.
Separately, the United States filed a separate civil complaint today seeking forfeiture of four properties that Parmar owns or controls, including a house on Colt’s Neck and three apartments in New York City. The U.S. Securities and Exchange Commission filed a civil complaint today against Parmar, Zaharis and Chivukula.
The investigation was conducted by the FBI Newark Field office with the assistance of the U.S. Securities and Exchange Commission’s New York Regional Office.
The government is represented by Trial Attorney Leslie Lehnert of the Criminal Division’s Money Laundering and Asset Recovery Section, Chief Paul A. Murphy of the U.S. Attorney’s Office’s Economic Crimes Unit, Assistant U.S. Attorney Nicholas P. Grippo of the Economic Crimes Unit, and Assistant U.S. Attorney Sarah Devlin of the U.S. Attorney’s Office for the District of New Jersey’s Asset Recovery Money Laundering Unit.
The charges and allegations contained in the complaint are merely accusations, and the defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Former CEO, CFO and Director of Healthcare Services Company Charged in Elaborate $300 Million Investment Fraud SchemeRead the Press Release
Defendants Allegedly Inflated Company’s Value and Revenue to Defraud Investors
NEWARK, N.J. – The former CEO, CFO and an executive director of a publicly traded health care services company were charged today with allegedly orchestrating a widespread scheme to defraud investors and others out of hundreds of millions of dollars in connection with a merger transaction designed to convert the company into a private entity, U.S. Attorney Craig Carpenito and Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division announced.
Parmjit “Paul” Parmar, 48, of Colts Neck, New Jersey; Sotirios “Sam” Zaharis, 51, of Weehawken, New Jersey; and Ravi Chivukula, 44, of Freehold, New Jersey, are charged by complaint with one count of conspiracy to commit securities fraud and one count of securities fraud. FBI agents arrested Parmar earlier today near his home. He is scheduled to appear this afternoon before U.S. Magistrate Judge Leda Dunn Wettre in Newark federal court. Chivukula and Zaharis remain at large.
According to the complaint unsealed today:
From May 2015 through September 2017, the defendants orchestrated an elaborate scheme to defraud a private investment firm and others out of hundreds of millions of dollars in connection with the funding of a transaction to take private a healthcare services company (Company A) traded publicly on the London Stock Exchange’s Alternative Investment Market. To fund the transaction, the private investment firm put up $82 million and a consortium of financial institutions put up another $130 million. The scheme utilized fraudulent methods to grossly inflate the value of Company A and trick others into believing that Company A was worth substantially more than its actual value.
The complaint alleges that to present a positive picture of the company’s financial wealth, the defendants allegedly sought to raise tens of millions of dollars in the public markets, purportedly to fund Company A’s acquisitions of various operating subsidiaries. In reality, a number of those entities either did not exist or had only a fraction of the operating income attributed to them. The conspirators allegedly funneled the proceeds of these secondary offerings through bank accounts they controlled and used the money for a variety of purposes that had nothing to do with acquiring the purported targets. The money from one of the offerings was instead used to make it appear as if the operating subsidiary had substantial customer revenue when, in fact, the funds were simply transfers of the money that had been raised in the secondary offering. The defendants went to great lengths to make it appear that these funds were revenue, concocting phony customers and altering bank statements to make it appear as if the funds were coming from customers.
The conspirators allegedly:
• Created fictitious operating companies that Company A purportedly acquired in sham acquisitions.
• Falsified and fabricated bank records of subsidiary entities in order to generate a phony picture of Company A’s revenue streams.
• Generated fake income streams and phony customers of Company A and its subsidiaries.
• Made material misrepresentations and omissions to the private investment firm and others.The defendants’ alleged actions caused the private investment firm and others to value Company A at more than $300 million for purposes of financing the transaction to take the company private.
The alleged scheme was uncovered around September 2017, when the defendants resigned from their positions with Company A or were terminated. On March 16, 2018, Company A and numerous of its affiliated entities filed for bankruptcy, attributing the company’s financial demise, in large part, to the fraud scheme.
The United States is expected to file a separate civil complaint today seeking forfeiture of four properties that Parmar owns or controls, including a house in Colt’s Neck and three apartments in New York City. Separately, the U.S. Securities and Exchange Commission also filed a civil complaint today against Parmar, Zaharis and Chivukula.
The conspiracy count with which the defendants are charged carries a maximum potential penalty of five years in prison and a $250,000 fine, or twice the gain or loss from the offense. The securities fraud count carries a maximum potential penalty of 20 years in prison and a $5 million fine.
U.S. Attorney Carpenito and Acting Assistant Attorney General Cronan credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie, with the investigation leading to today’s charges. They also thanked the U.S. Securities and Exchange Commission’s New York Regional Office, under the direction of Regional Director Marc P. Berger and Associate Regional Director Lara S. Mehraban, for its assistance.
The government is represented by Paul A. Murphy, Chief of the U.S. Attorney’s Office’s Economic Crimes Unit, Assistant U.S. Attorney Nicholas P. Grippo of the Economic Crimes Unit, Trial Attorney Leslie Lehnert of the Justice Department Criminal Division’s Money Laundering and Asset Recovery Section, and Assistant U.S. Attorney Sarah Devlin of the U.S. Attorney’s Office’s Asset Recovery Money Laundering Unit.
The charges and allegations contained in the complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Morris County Man Admits Distribution of Child PornographyRead the Press Release
NEWARK, N.J. – A Morris County, New Jersey man today admitted distributing images of child sexual abuse, U.S. Attorney Craig Carpenito announced.
Mark Derzko, 74, of Mine Hill, New Jersey, pleaded guilty before U.S. District Judge William H. Walls in Newark federal court to an information charging him with one count of distribution of child pornography. Derzko remains on bail pending sentencing.
According to documents filed in the case and statements in court:
Derzko used a peer-to-peer file-sharing program, which he installed on his computer several years ago, to download videos and images of child sexual abuse. In May, August and September of 2016, law enforcement downloaded more than two dozen videos of child sexual abuse from Derzko’s computer. After executing a search warrant at Derzko’s home in October 2016, agents located more than 2,000 videos and over 8,000 images of child sexual abuse on Derzko’s computers. Derzko admitted that he was making available for others to download videos he had previously saved on his computer.
The distribution of child pornography charge to which Derzko pleaded guilty carries a maximum potential penalty of 20 years in prison, a mandatory minimum sentence of five years in prison and a $250,000 fine. Derzko will be required to register as a sex offender. Sentencing is scheduled for Aug. 28, 2018.U.S. Attorney Carpenito credited special agents with the Department of Homeland Security, Homeland Security Investigations, under the direction of Newark Acting Special Agent in Charge Brian Michael, with the investigation leading to today’s guilty plea. He also thanked the Morris County Prosecutor’s Office and the Wharton, New Jersey, Police Department for their assistance with the case.
The government is represented by Senior Litigation Counsel Mark J. McCarren of the U.S. Attorney’s Special Prosecutions Division in Newark.
Defense counsel: Michael Koribanics Esq., Clifton, New Jersey
Former Middlesex Borough Fire Inspector Admits Conspiring to Commit Strongarm ExtortionRead the Press Release
NEWARK, N.J. – A former fire inspector for Middlesex Borough and other New Jersey municipalities today admitted conspiring with another person to commit a strongarm extortion, U.S. Attorney Craig Carpenito announced today.
Billy A. Donnerstag, 49, of Hackettstown, New Jersey, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to an indictment returned against him charging him with conspiring to commit extortion using threats of force, violence, and fear.
According to the documents filed in this case and statements made in court:
From December 2016 through June 2017, Donnerstag conspired with Joseph P. Martinelli of Kenvil, New Jersey, to extort the owner and operator of a real estate development and construction company – referred to in the indictment as “Individual 1” – using threats of physical harm if Individual 1 did not pay Donnerstag and Martinelli thousands of dollars. In a series of telephone and in-person conversations with Individual 1, Donnerstag and Martinelli told Individual 1 that, in addition to being a fire inspector for Middlesex Borough, Donnerstag also collected debts. Donnerstag and Martinelli wanted Individual 1 to pay Martinelli, stating that Individual 1 had not paid Martinelli enough money for the sale of a property a decade earlier. During the course of the conspiracy, both Donnerstag and Martinelli made a series of threatening statements to Individual 1 that the consequences of failing to pay Donnerstag and Martinelli would involve physical harm to Individual 1.
Donnerstag told Individual 1:
• “if you were in front of me right now, you’d be on the floor. Okay? Cause I don’t talk—I don’t get talked to like that. You don’t know who I am.”
• “You need to iron this out with Joe. Again, if, if I have to come meet you now—again, it, it, it, it’d become, it’s gonna be a problem.”
• “What I do, is I make sure that people don’t take advantage of other people. Do you understand that? Now I also do other things, but this is one of the things that I do. Now, again if you’re not figuring wh, what my business is by now, you’re either, and again I, I say this with as much respect as I can, either an idiot, or you’re just lying because you don’t want to, to, to understand that I come from somewhere that most people don’t wanna see.”Ultimately, over two separate meetings (both of which were lawfully recorded), Donnerstag and Martinelli obtained $15,000 in cash from Individual 1. The cash had been provided by the FBI.
The count of conspiracy to commit extortion carries a maximum potential penalty of up to 20 years in prison and a fine of up to $250,000 or twice the gross gain or loss. Martinelli previously pleaded guilty before Judge Arleo on March 2, 2018, to conspiring with Donnerstag to commit extortion. Sentencing for Donnerstag is scheduled for Sept. 25, 2018. Martinelli’s sentencing is scheduled for June 12, 2018.
U.S. Attorney Carpenito credited special agents with the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, New Jersey, with the investigation leading to the guilty pleas of Donnerstag and Martinelli.
The government is represented by Assistant U.S. Attorney Lee M. Cortes Jr., Deputy Chief of the U.S. Attorney’s Office Special Prosecutions Division in Newark.
Defense counsel: Zahid N. Quraishi Esq., Morristown, New Jersey
Former IRS Employee Pleads Guilty to Unauthorized Possession of Official Federal Agency Identification CardRead the Press Release
NEWARK, N.J. – A former IRS attorney today admitted possessing a federal agency identification card without authorization and using it during multiple traffic stops, U.S. Attorney Craig Carpenito announced.
Deon Owensby, 42, of Trenton, New Jersey, pleaded guilty before U.S. Magistrate Judge Leda Dunn Wettre in Newark federal court to an information charging him with knowingly possessing an official identification card of a federal agency without authorization.
According to documents filed in this case and statements made in court:
Owensby obtained an official IRS identification card known as an IRS Pocket Commission during his employment as an attorney with the IRS. The IRS Pocket Commission, which IRS employees use to identify themselves to the public when performing official duties, was to be returned to the IRS upon the end of his employment in April 2015.
However, from August 2015 to April 2017, Owensby continued to possess the IRS Pocket Commission and displayed it during multiple law enforcement stops of his vehicle in Essex and Middlesex Counties.
The count of possessing an official identification card of a federal agency without authorization is punishable by a maximum potential penalty of six months in prison and a $5,000 fine. Owensby’s sentencing is scheduled for Aug. 28, 2018.
U.S. Attorney Carpenito credited special agents of the U.S. Treasury Inspector General for Tax Administration, under the direction of Special Agent in Charge Rodney A. Davis, with the investigation. He also thanked the N.J. State Police, under the direction of Superintendent Col. Patrick J. Callahan, and the Millburn Police Department, under the direction of Chief Brian Gilfedder, for their assistance.The government is represented by Assistant U.S. Attorney Jihee G. Suh of the U.S. Attorney Office’s Special Prosecutions Division in Newark
Defense counsel: Patrick McMahon Esq., Assistant Federal Public Defender, Newark
Psychiatrist Admits Signing Phony Medical Records to Deceive State InspectorsRead the Press Release
CAMDEN, N.J. – The psychiatrist of a nonprofit mental health services provider for Camden’s poorest residents today admitted signing fraudulent treatment plans meant to mislead New Jersey Medicaid inspectors, U.S. Attorney Craig Carpenito announced.
Lyda Monte, 78, of Bellmawr, New Jersey, pleaded guilty before U.S. District Judge Noel L. Hillman in Camden federal court to an information charging her with making false statements to a health care benefit program.
According to documents filed in this case and statements made in court:
Monte was a psychiatrist at Nueva Vida Behavioral Health Center of New Jersey, a nonprofit provider of mental health services to the Camden Hispanic community. Most of Nueva Vida’s patients were Medicaid beneficiaries and the center was periodically inspected and audited by New Jersey Medicaid authorities.Between January 2010 and August 2016, Cesar Tavera, the Executive Director of Nueva Vida, directed Nueva Vida therapists to prepare false treatment plans, including plans reflecting treatment that was not actually performed on patients, in order to mislead New Jersey Medicaid inspectors. Tavera then directed Monte to sign these fabricated treatment plans. Monte admitted today that she signed the treatment plans knowing that they were fraudulent and that they were intended to mislead New Jersey Medicaid inspectors.
Monte faces a maximum penalty of five years in prison and a $250,000 fine, or twice the gain or loss caused by the offense. Sentencing is scheduled for Aug. 28, 2018.
Cesar Tavera previously pleaded guilty to defrauding New Jersey Medicaid out of $2.5 million and embezzling more than $1.5 million from Nueva Vida. He was sentenced to 70 months in prison. Maria Tavera, a Nueva Vida administrator, pleaded guilty to embezzling from Nueva Vida and was sentenced to six months of home detention and three years of probation. Andres Ayala, a Nueva Vida therapist, previously pleaded guilty to conspiracy to commit health care fraud and awaits sentencing.
U.S. Attorney Carpenito credited agents of the FBI’s South Jersey Resident Agency, under the direction of Special Agent in Charge Michael Harpster in Philadelphia, and special agents from the Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert, with the investigation. He also thanked the Medicaid Fraud Division of the New Jersey Office of the State Comptroller.The government is represented by Assistant U.S. Attorney R. David Walk Jr. of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Camden.
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Defense counsel: Rocco C. Cipparone Jr. Esq., Haddon Heights, New Jersey
Illegal Alien Admits Unlawfully Returning to the United States and Failing to Register as A Sex OffenderRead the Press Release
CAMDEN, N.J. – An El Salvadorian man previously convicted for sexually assaulting a child today admitted to failing to register as a sex offender after unlawfully returning to the United States and traveling to New Jersey, U.S. Attorney Craig Carpenito announced.
Samuel De Jesus Corvera-Mata, 42, pleaded guilty before Senior U.S. District Judge Jerome B. Simandle in Camden federal court to a two-count information charging him with illegal re-entry subsequent to conviction for an aggravated felony and failing to register as required by the Sex Offender Registration and Notification Act (SORNA).
SORNA requires all sex offenders to register and keep that registration current in each jurisdiction where the sex offender resides.According to documents filed in this case and statements made in court:
Corvera-Mata admitted that he illegally re-entered the United States after being deported to El Salvador following a 10-year prison sentence in California for committing multiple lewd and lascivious acts upon a seven-year-old child. As a result of his prior offenses, Corvera-Mata was required to register as a sex offender if he ever returned to the United States. Corvera-Mata later illegally re-entered the country and travelled to New Jersey, where he was located and arrested in October 2017.
Corvera-Mata faces a maximum potential penalty of 20 years in prison and a $250,000 fine for the illegal re-entry charge, and 10 years in prison and a $250,000 fine for the SORNA charge. Sentencing is scheduled for Sept. 7, 2018.
U.S. Attorney Carpenito credited officers of U.S. Immigration and Customs Enforcement’s (ICE) Enforcement and Removal Operations (ERO), under Newark Field Office Director John Tsoukaris, and the U.S. Marshals Service, under the direction of U.S. Marshal Juan Mattos in Newark, with the investigation.
The government is represented by Assistant U.S. Attorney Gabriel J. Vidoni of the U.S. Attorney’s Office’s Criminal Division in Camden.
Defense counsel: Maggie Moy Esq., Camden, New Jersey
One Tax Preparer Pleads Guilty, Three Others Arraigned in Conspiracy to File False Income Tax ReturnsRead the Press Release
TRENTON, N.J. – One employee of an Essex County, New Jersey, tax preparation business pleaded guilty and three others were arraigned in federal court for their roles in a false income tax return conspiracy that caused tax losses of over $900,000, U.S. Attorney Craig Carpenito announced today.
Rudolph Sanders, 41, of Newark, New Jersey, pleaded guilty today before U.S. District Judge Michael A. Shipp in Trenton federal court to an information charging him with one count of conspiracy to defraud the IRS from February 2011 through March 2013.
Joseph Kenny Batts, 49, of Elkridge, Maryland, Angelo K. Thompson, 38, of Reistertown, Maryland, and Tony V. Russell, 47, of Stone Mountain, Georgia, were arraigned before Judge Shipp on May 9, 2018. They are each charged by indictment with one count of conspiracy to defraud the IRS from February 2013 through February 2017. In addition, Batts is charged with five counts of aiding and assisting in the preparation of false federal income tax returns, Thompson is charged with two counts of aiding and assisting in the preparation of false federal income tax returns, and Russell is charged with one count of aiding and assisting in the preparation of false federal income tax returns.
In June 2017, Damien Askew, 39, of Union, New Jersey, pleaded guilty to his role in the scheme from 2011 to 2015 and awaits sentencing. All five defendants have been released on bail.
According to documents filed in this case and statements made in court:
From 2009 through April 2015, Batts and Askew co-owned Tax Pro’s, a tax return preparation and payroll business in Essex County where Sanders, Batts, Thompson, Russell, and Askew all prepared tax returns.
In order to boost their business, the defendants conspired to falsify their clients’ income tax returns for the purpose of generating refunds in amounts that their clients were not entitled to receive. For instance, Sanders, Batts, Thompson, Russell, and Askew fabricated or inflated their clients’ education credits, child care deductions, charitable contributions, unreimbursed employee expenses, and certain business losses.
Sanders and other members of the conspiracy also permitted Batts to use their identification numbers in order to conceal Batts’ identity as the actual tax return preparer, partly due to Batts’ prior tax fraud conviction.
After law enforcement executed a search warrant at Tax Pro’s in April 2015, Batts discontinued Tax Pro’s and opened Tax Solutions and Associates in Union, New Jersey, where Batts, Thompson, and Russell continued preparing false federal income tax returns.
By inflating the tax refunds through fraudulent means, Batts, Askew, Thompson, Russell, and Sanders caused a total tax loss to the United States of over $900,000.The conspiracy charge carries a maximum potential penalty of five years in prison. The aiding and assisting in the preparation of a false return charge carries a maximum potential penalty of three years in prison. Both charges carry a $250,000 fine, or twice the gross gain or loss from the offense.
Sanders’ sentencing is scheduled for Aug. 14, 2018. The charges and allegations against Batts, Thompson, and Russell are merely accusations, and they are presumed innocent unless and until proven guilty.
U.S. Attorney Carpenito credited special agents of IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Bryant Jackson in Newark, with the investigation.
The government is represented by Assistant U.S. Attorneys Jihee G. Suh and Cari Fais of the U.S. Attorney’s Office Special Prosecutions Division in Newark.
Defense counsel:
Sanders: Carol Gillen Esq.
Batts: Fred Klepp Esq.
Russell: Anthony Simonetti Esq.
Thompson: Scott A. Krasny Esq.
Askew: David Glassman Esq.Doctor Sentenced to Two Years in Prison for Taking Bribes in Test-Referral Scheme with New Jersey Clinical LabRead the Press Release
NEWARK, N.J. – A Monmouth County doctor with practices in Colts Neck, New Jersey, and Staten Island, New York, was sentenced today to 24 months in prison for accepting bribes in exchange for test referrals as part of a long-running and elaborate scheme operated by Biodiagnostic Laboratory Services LLC (BLS), of Parsippany, New Jersey, its president and numerous associates, U.S. Attorney Craig Carpenito announced.
Ralph Messo, 56, of Colts Neck, New Jersey, previously pleaded guilty before U.S. District Judge Stanley R. Chesler to an information charging him with one count of accepting bribes. Judge Chesler imposed the sentence today in Newark federal court.
According to documents filed in this and related cases and statements made in court:
Messo admitted he accepted bribes in return for referring patient blood specimens to BLS and was paid approximately $3,000 per month. Messo’s referrals generated at least $828,000 in lab business for BLS.
In addition to the prison term, Judge Chesler sentenced Messo to two years of supervised release and fined him $4,000.
The investigation has thus far resulted in 53 convictions – 38 of them doctors – in connection with the bribery scheme, which its organizers have admitted involved millions of dollars in bribes and resulted in more than $100 million in payments to BLS from Medicare and various private insurance companies. It is believed to be the largest number of medical professionals ever prosecuted in a bribery case.
The investigation has to date recovered more than $13 million through forfeiture. On June 28, 2016, BLS, which is no longer operational, pleaded guilty and was required to forfeit all of its assets.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark; inspectors of the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Ruth M. Mendonca; IRS–Criminal Investigation, under the direction of Acting Special Agent in Charge Bryant Jackson in Newark; and the U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert, with the ongoing investigation.
The government is represented by Senior Litigation Counsel Joseph N. Minish, Assistant U.S. Attorney Danielle Alfonzo Walsman and Jacob T. Elberg, Chief of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark, as well as Assistant U.S. Attorney Barbara Ward, of the office’s Asset Forfeiture and Money Laundering Unit.
Former Law Firm Clerk Resentenced to 37 Months in Prison for Role in $2 Million Insider Trading SchemeRead the Press Release
TRENTON, N.J. - The former managing clerk for an international law firm was resentenced today to 37 months in prison for stealing sensitive, confidential information from the law firm for use in a five-year insider trader scheme that yielded net profits of more than $2 million, U.S. Attorney Craig Carpenito announced.
Steven Metro, 44, formerly of Katonah, New York, was sentenced today to 37 months in prison. U.S. District Judge Michael A. Shipp imposed the sentence in Trenton federal court.
In November 2015, Metro pleaded guilty to the first two counts of an indictment charging him with securities fraud and conspiracy to commit securities and tender offer fraud, and was sentenced to 46 months in prison in September 2016. Metro appealed his sentence to the U.S. Court of Appeals for the Third Circuit, which vacated Metro’s sentence in February 2018 and remanded the case to the District Court for resentencing after further factual findings pertaining to the total loss amount attributable to Metro.
According to documents filed in this case and statements made in court:
From 2009 to 2013, Metro stole material nonpublic information from Simpson Thacher & Bartlett LLP related to corporate transactions, such as mergers and acquisitions or tender offers, in which the firm represented a party or financial advisor to the transaction. As the firm’s managing clerk, Metro did not personally work on most of these transactions. Instead, Metro stole the inside information by scouring the firm’s computer system for client names and the keywords “merger agreement,” “bid letter,” “engagement letter,” and “due diligence.”
After obtaining the inside information, Metro would meet his friend, Frank Tamayo, 44, of Brooklyn, New York, at a bar, coffee shop, or other location near their respective workplaces in midtown Manhattan. During these meetings, Metro provided Tamayo material information pertaining to, among other things, the names and/or ticker symbols of the companies whose securities should be purchased. Tamayo would write the security’s ticker symbol on a small piece of paper or napkin and commit the rest of the inside information to memory.
Afterwards, Tamayo would meet Vladimir Eydelman, 46, formerly of Colts Neck, New Jersey, usually at a location near Eydelman’s workplace, such as at the large clock in New York City’s Grand Central Terminal. Tamayo would show Eydelman the paper or napkin with the ticker symbol of the company whose securities should be purchased. After Eydelman memorized the ticker symbol, Tamayo would place the paper or napkin into his mouth and chew it until it was destroyed.
After receiving the inside information provided by Metro, whom Eydelman knew as Tamayo’s “source,” Eydelman then purchased securities for himself, family members, friends, and clients, including Tamayo. Eydelman quickly sold the shares and covered any positions once the relevant deal was publicly announced and the stock price rose.
Throughout the course of the approximately five-year scheme, Tamayo reinvested the approximately $7,000 in profits that Metro made on the first deal, and updated Metro on the running balance of his profits from the insider trading scheme. As of October 2013, by which time the conspirators had traded ahead of at least 13 planned corporate transactions, Metro’s share of the profits had reached approximately $168,000. Metro sought to “cash out” his share of the accrued profits from the insider trading scheme, pressing Tamayo to “liberate some cash” during a meeting in January 2014. Eydelman paid approximately $7,000 in cash to Tamayo in February 2014, with the expectation that Tamayo would use the cash to compensate his law firm source – i.e., Metro – for providing them the inside information.
By exploiting the information that Metro stole from the firm, Metro, Tamayo and Eydelman personally, or on behalf of close affiliates, such as family members, netted more than $2 million in illicit profits over five years.
In addition to the prison term, Judge Shipp sentenced Metro to three years of supervised release.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, with the investigation. He also thanked the U.S. Securities and Exchange Commission’s New York Regional Office, under the direction of Regional Director Marc P. Berger and Senior Associate Regional Director Sanjay Wadhwa, for its assistance
The government is represented by Assistant U.S. Attorney Shirley U. Emehelu, Chief of the Asset Recovery and Money Laundering Unit, Senior Litigation Counsel R. Joseph Gribko of the U.S. Attorney’s Office in Trenton, and Senior Litigation Counsel Barbara A. Ward of the Asset Recovery and Money Laundering Unit.
Defense counsel: Lawrence S. Lustberg Esq., and Anne M. Collar Esq., Newark
Federal Inmate at Fort Dix Admits Possessing Hundreds of Images and Videos of Child Sexual Abuse While in PrisonRead the Press Release
CAMDEN, N.J. – A Virginia Beach, Virginia, man today admitted possessing images and videos of child sexual abuse while imprisoned at Federal Correctional Institution Fort Dix for a previous offense involving the transportation of child pornography, U.S. Attorney Craig Carpenito announced.
Christopher D. Roffler, 30, pleaded guilty before Senior U.S. District Judge Joseph H. Rodriguez in Camden federal court to an information charging him with one count of possession of child pornography.
According to documents filed in this case and statements made in court:
Roffler admitted that he possessed a micro SD Card containing 305 videos and 16 images of child pornography, including depictions of sexual abuse of pre-pubescent children and sadistic and masochistic conduct. In connection with his plea, Roffler also admitted that he used a cellular telephone inside the prison to obtain and possess child pornography and that he transferred a micro SD card containing child pornography to another inmate.
Roffler and seven other inmates were arrested in April 2017 and February 2018 following an FBI investigation involving multiple covert recordings and several cooperating inmates. The investigation revealed that Roffler and other inmates utilized contraband cellphones, micro SD cards, and access to the internet to obtain, view, and distribute child pornography within the prison. A co-defendant organized and helped facilitate this criminal activity by maintaining cloud accounts that were used as repositories for child pornography.At sentencing, Roffler faces a mandatory minimum term of 10 years in prison and a lifetime of supervised release. Sentencing is scheduled for Sept. 12, 2018.
Four other inmates – Anthony C. Jeffries, 32, of Orange, Virginia, Jordan T. Allen, 31, of Plain City, Ohio, Brian J. McKay, 47, of Brookhaven, Pennsylvania, and Jacob S. Good, 26, of Fredericksburg, Virginia – have also pleaded guilty to possession of child pornography and await sentencing.
A fifth inmate, Erik M. Smith, 36, of Iron Mountain, Michigan pleaded guilty to the same charge and was sentenced on May 7, 2018 to an additional 151 months in prison.Charges remain pending against William H. Noble, 52, of Lowell, Massachusetts, and Charles Wesley Bush, 38, of Knoxville, Tennessee, both of whom were serving sentences for prior child pornography offenses while committing the alleged crimes in this case. The pending charges and allegations against them are merely accusations, and these defendants are presumed innocent unless and until proven guilty.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, with the investigation. He also thanked officials of the Bureau of Prisons at Federal Correctional Institution Fort Dix for their assistance.
The government is represented by Assistant U.S. Attorneys Gabriel J. Vidoni and Alyson M. Oswald of the U.S. Attorney’s Office’s Criminal Division in Camden.
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Defense counsel: Tamika McKoy Esq., Camden
Essex County, New Jersey, Man Admits $2 Million Fraudulent Check Scheme Targeting Home-Improvement StoresRead the Press Release
NEWARK, N.J. – An Irvington, New Jersey, man today admitted his role in a phony check scheme that stole over $2 million in merchandise from multiple home-improvement stores throughout the country, U.S. Attorney Craig Carpenito announced.
Koreen Higgs, 44, pleaded guilty before U.S. District Judge Katharine S. Hayden in Newark federal court to an information charging him with one count of conspiracy to commit wire fraud.According to documents filed in this case and statements made in court:
Starting in December 2013 and continuing through February 2017, several individuals, including Higgs, conspired to obtain merchandise or store credit from home-improvement stores in locations along the eastern United States, including New Jersey, by purchasing items with fraudulent checks.
Higgs and others entered home-improvement and other retail stores and gathered several high-value items like air conditioners or hardwood flooring. Higgs and others then typically “purchased” the items either by handing a cashier a fraudulent check with a phony name but authentic account and routing numbers, or by pretending to be an authorized signatory on a store credit account that Higgs and others had previously opened with a phony check.
During some of the transactions, Higgs and others displayed fake driver’s licenses that had been created by one of the other conspirators, which either duplicated the phony name imprinted on the fraudulent check they presented for payment or matched the name of an authorized signatory on a store credit account that they had previously opened.
In total, Higgs and others stole over $2 million in merchandise from various retailers in New Jersey, New York, Pennsylvania, Delaware, North Carolina, Georgia, Virginia, Connecticut, Massachusetts, and South Carolina.
Higgs faces 20 years in prison and a $250,000 fine for the wire fraud conspiracy charge. Sentencing is scheduled for Sept. 17, 2018.
U.S. Attorney Carpenito credited postal inspectors of the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Ruth M. Mendonca, and special agents of the U.S. Attorney’s Office, District of New Jersey, with the investigation. He also thanked the Union Township Police Department, the Holmdel Police Department, the Passaic County Prosecutor's Office, the Totowa Police Department, and the Monroe Township Police Department for their assistance.
The government is represented by Assistant U.S. Attorney Jason S. Gould of the U.S. Attorney’s Office Criminal Division in Newark.Defense counsel: Alexander Booth Esq., Jersey City, New Jersey
Connecticut Man Sentenced to Prison for Role in $5 Million Investment Fraud SchemeRead the Press Release
NEWARK, N.J. - A Fairfield, Connecticut, man was sentenced today to 19 months in prison for his role in a securities scheme that defrauded investors out of more than $5 million, U.S. Attorney Carpenito said.
James Trolice, 64, previously pleaded guilty before U.S. District Judge William J. Martini to a two-count information charging him with securities fraud and transacting in criminal proceeds. Judge Martini imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
Trolice was the president and owner of Trolice Consulting Services LLC and the president and chief marketing officer of eAgency, a California-based company that developed mobile security products. Trolice and Lee Vaccaro, 46, of Las Vegas, sold investors interests in Trolice Consulting Services and companies Vaccaro controlled and falsely represented to investors that those companies held warrants in eAgency. Warrants are derivative securities that give the holder the right to purchase common stock at a specific price within a certain time frame.
Trolice admitted that he made oral and written misrepresentations concerning the existence, number, validity, and term of eAgency warrants purportedly owned by the investment companies; the amount of money he had personally invested in and raised for eAgency; and his current position at eAgency.
Trolice also admitted that beginning in January 2011, the dollar amount of interests Trolice and Vaccaro sold in the investment companies began to surpass the dollar amount of valid warrants held by the investment companies. Neither Trolice nor Vaccaro disclosed to investors the risk that their investments would be diluted by the sale of additional interests in the companies. Altogether, Trolice and Vaccaro defrauded investors out of more than $5 million.
In addition to the prison term, Judge Martini sentenced Trolice to three years of supervised release and ordered him to pay $5,000,512.65 representing the proceeds of his offense.
Vaccaro previously pleaded guilty to his role in the scheme and was sentenced Feb. 17, 2017 to 78 months in prison.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, and special agents of IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Bryant Jackson in Newark, with the investigation. He also thanked the U.S. Securities and Exchange Commission’s New York Regional Office, under the direction of Regional Director Marc P. Berger and Senior Associate Regional Director Sanjay Wadhwa, for its assistance.
The government is represented by Senior Litigation Counsel Daniel Shapiro of the U.S. Attorney’s Office Economic Crimes Unit and Executive Assistant U.S. Attorney Zach Intrater.
Defense counsel: Michael Koribanics Esq., Clifton, New Jersey
Federal Inmate Sentenced to 151 Months in Prison for Possessing Images of Child Sexual Abuse While IncarceratedRead the Press Release
CAMDEN, N.J. – A federal inmate already serving a lengthy sentence for a child pornography conviction was sentenced today to 151 months in prison for possessing images of child pornography while incarcerated, U.S. Attorney Craig Carpenito announced.
Erik M. Smith, 36, of Iron Mountain, Michigan, previously pleaded guilty before U.S. District Judge Joseph H. Rodriguez to an information charging him with possession of child pornography through the use of a contraband micro SD card. Smith was already serving a 235-month sentence at Federal Correctional Institution Fort Dix (FCI Fort Dix) for his conviction in the Western District of Michigan for receipt of child pornography. Judge Rodriguez imposed today’s sentence in Camden federal court.
According to documents filed in this case and statements made in court:
Smith possessed a 16-gigabyte micro SD card containing 263 images of child pornography, including 213 sexually explicit images of prepubescent children. He told another inmate the SD card included “mostly boy stuff,” referring to images of boys. Smith admitted that he downloaded these and other images of child pornography from a cloud account on behalf of other inmates.Smith and seven other inmates were arrested in April 2017 and February 2018 following an FBI investigation involving multiple covert recordings and several cooperating inmates. The investigation revealed that Smith and other inmates utilized contraband cellphones, micro SD cards, and access to the internet to obtain, view, and distribute child pornography within the prison. A co-defendant organized and helped facilitate this criminal activity by maintaining cloud accounts that were used as repositories for child pornography.
In addition to the prison term, Judge Rodriguez sentenced Smith to five years of supervised release.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, with the investigation. He also thanked officials of the Bureau of Prisons at Federal Correctional Institution Fort Dix for their assistance.
The government is represented by Assistant U.S. Attorneys Gabriel Vidoni and Alyson M. Oswald of the U.S. Attorney’s Office’s Criminal Division in Camden.
Defense counsel: Mark W. Catanzaro Esq., Mount Holly, New Jersey
Connecticut Man Found Guilty on Wire Fraud Charges for Credit and Gift Card Fraud SchemeRead the Press Release
NEWARK N.J. – A Connecticut man who defrauded credit card companies of hundreds of thousands of dollars was found guilty on stolen goods charges today, U.S. Attorney Craig Carpenito announced.
Nikolay Krechet, 47, of West Hartford, Connecticut, was found guilty on all counts on which he was indicted – one count of conspiracy to sell, receive or possess stolen goods and two counts of sale, receipt or possession of stolen goods following a two-and-a-half week trial before U.S. District Judge William H. Walls in Newark federal court. The jury deliberated 25 minutes before returning the guilty verdicts.
According to documents filed in this case and the evidence at trial:
Krechet bought and used millions of dollars of gift cards purchased with stolen credit card information. The substantive counts corresponded to the purchase of tens of thousands of dollars of gift cards in cash and bartered electronics for gift cards at a considerable discount off their face value.
The conspiracy count carries a maximum penalty of five years in prison and the two substantive counts each carry a maximum penalty of 10 years in prison. Sentencing is scheduled for July 31, 2018.
U.S. Attorney Carpenito credited special agents of FBI, under the direction of Special Agent in Charge Gregory W. Ehrie; the U.S. Secret Service, under the direction of Special Agent in Charge Mark McKevitt; and the U.S. Postal Inspection Service, under the director of Acting Inspector in Charge Ruth M. Mendonca, with the investigation leading to today’s conviction.
The government is represented by Assistant U.S. Attorneys David Feder and Joshua Haber of the U.S. Attorney’s Office Criminal Division in Newark.
Defense counsel: Thomas Ambrosio Esq., Lyndhurst, New Jersey
Middlesex County, New Jersey, Tax Preparer Charged with Filing False Tax ReturnsRead the Press Release
NEWARK, N.J. – A Keasbey, New Jersey, tax preparer was indicted today for allegedly using false information to increase his clients’ tax refunds and secretly diverting a portion of those funds into accounts that he controlled, U.S. Attorney Craig Carpenito announced.
David Patterson, 37, is charged by indictment with 16 counts of aiding and abetting in the filing of false tax returns. Patterson will be arraigned at a later date.
According to the indictment:
Patterson owned D&D Tax Service LLC, a tax preparation business located in Keasbey. Patterson allegedly prepared multiple fraudulent tax returns on behalf of his clients by falsifying their income, charitable contributions, employee business expenses, and education costs, all so his clients would receive higher refunds than those to which they were actually entitled. Patterson then diverted a portion of the tax refunds to bank accounts he controlled without his clients’ knowledge or consent.
According to the indictment, Patterson allegedly prepared 53 phony tax returns on behalf of 19 clients for tax years 2010 through 2015, which resulted in a tax loss to the United States of $290,321.
The false filing charges each carry a maximum potential penalty of three years in prison and a $250,000 fine.
U.S. Attorney Carpenito credited special agents of IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Bryant Jackson in Newark, and special agents of the U.S. Attorney’s Office, District of New Jersey, with the investigation.
The government is represented by Assistant U.S. Attorney Deborah J. Gannett of the U.S. Attorney’s Office Asset Recovery and Money Laundering Unit.
The charges and allegations in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Defense counsel: Patrick Mullin Esq., Fort Lee, New Jersey
Passaic County Man Indicted for Trying to Bring Loaded Gun on Plane at Newark Liberty International AirportRead the Press Release
Laron L. James, a/k/a/ “Juelz Santana,” 36, of Totowa, New Jersey, is now charged by indictment with one count of possession of a firearm by a convicted felon and one count of carrying a weapon on an aircraft. The indictment was returned April 30, 2018. He was originally arrested and charged by complaint with the same counts, as described in the historic press release of March 12, 2018. His arraignment is scheduled for Thursday, May 10, 2018 at 10:30 a.m. EST before U.S. District Judge Stanley R. Chesler in Newark federal court. The indictment is attached.
New Egypt, New Jersey, Man Arrested on Charge of Production of Child Pornography AbroadRead the Press Release
TRENTON, N.J. – An Ocean County, New Jersey, cargo pilot who travels abroad frequently has been arrested for allegedly coercing a minor to participate in acts of child sexual abuse, which he recorded on camera and imported to the United States, U.S. Attorney Craig Carpenito announced.
Frank William Maile, 62, of New Egypt, New Jersey, was arrested May 1, 2018, by agents of the Department of Homeland Security, Homeland Security Investigations (HSI). Maile is retired from the U.S. Air Force and currently works as a cargo pilot. He is charged by complaint with one count of producing visual depictions of child sexual abuse outside the United States, with the intent that the depictions be imported into the United States. Maile made his initial appearance today before U.S. Magistrate Judge Douglas E. Arpert and was remanded without bail.
According to documents filed in this case and statements made in court:
On Dec. 2, 2015, and December 3, 2015, while in the Philippines, Maile created images and videos of two minor females engaging in multiple sex acts.
The charge of producing child pornography abroad carries a mandatory minimum sentence of 15 years in prison, a maximum potential penalty of 30 years in prison, and a $250,000 fine.
U.S. Attorney Carpenito credited special agents of the Department of Homeland Security (DHS), Homeland Security Investigations (HSI), Cherry Hill office, under the direction of Resident Agent in Charge Richard Reinhold, with the investigation leading to the charges. He also thanked the Ocean County Prosecutor’s Office, under the direction of Prosecutor Joseph D. Coronato, and the Plumsted Township Police Department, under the direction of Chief Earl Meroney, for their assistance with the investigation.
The government is represented by Assistant U.S. Attorney Elisa T. Wiygul of the U.S. Attorney’s Office’s Criminal Division in Trenton.
The charges and allegations in the complaint are merely accusations, and the defendant is considered innocent unless and until proven guilty.
Anyone with information regarding possible victims of this activity is urged to contact HSI’s tip line at 866-DHS-2-ICE.
Defense counsel: Hercules Pappas Esq., Haddonfield, New Jersey
Burlington County, New Jersey, Construction Firm to Pay $1.5 Million to Resolve Joint State and Federal False Claims ActionRead the Press Release
NEWARK, N.J. – A Southampton, New Jersey, construction company will pay $1.5 million to resolve allegations that it committed multiple False Claims Act violations by contracting for public construction jobs despite paying its workers a lower hourly wage than required under state and federal law, U.S. Attorney Craig Carpenito and New Jersey Attorney General Gurbir S. Grewal announced today.
The settlement resolves a joint state and federal investigation of Ranco Construction’s labor practices conducted by the U.S. Attorney’s Office and the New Jersey Attorney General. The investigation began after a former Ranco employee filed a federal qui tam, or “whistle-blower,” lawsuit against the company.
In that lawsuit, the relator claimed that Ranco routinely entered into construction contracts with various state and federal entities and certified to the government that its employees were paid hourly wage rates set under federal and New Jersey prevailing wage laws.
The relator alleged, however, that Ranco systematically underpaid several of its workers and then falsified company payroll records to disguise the conduct. The relator worked for Ranco for a total of nine years – first as a laborer and then as an electrician – and left the company in 2016. He alleged in his lawsuit that Ranco forced him out for objecting to the company’s allegedly unlawful practices.
“Companies that contract with the federal government undertake an obligation to pay their employees a fair wage,” said U.S. Attorney Carpenito. “When contractors pay substandard wages and then falsely certify their compliance to the government, they not only cheat their employees, they also gain an unfair advantage in the contract bidding process, all at taxpayer expense.”
“The rules are simple: if a construction company wants to do business with the State of New Jersey, it has to pay its workers a fair wage. Ranco took the State’s money but then failed to keep up its end of the bargain,” said Attorney General Grewal. “As part of today’s settlement, we are recovering nearly half-a-million dollars for New Jersey taxpayers. Just as importantly, we are sending an important message – vendors who do business with public entities in New Jersey must act with integrity and honesty, and will be held accountable if they don’t.”
"The integrity of the DoD procurement system is a priority for the Defense Criminal Investigative Service (DCIS)," stated Special Agent-in-Charge Leigh-Alistair Barzey, DCIS Northeast Field Office. "This settlement agreement is the direct result of a joint effort by DCIS, the U.S. Attorney's Office and the New Jersey Attorney General to ensure that contractors do not gain an unfair competitive advantage by failing to comply with required federal labor laws."
The relator in the underlying qui tam will receive more than $150,000 as his statutory share of the recovery and to resolve his employment based claims in accordance with the False Claims Act. The civil lawsuit was filed in the District of New Jersey and is captioned United States ex rel. Robert Kleinow and the State of New Jersey ex rel. Robert Kleinow and Robert Kleinow individually v. Ranco Construction, Civ. Action No. 15-7278.
The civil settlement is not an admission of liability or improper conduct by Ranco.
U.S. Attorney Carpenito thanked special agents of the U.S. Department of Defense, Defense Criminal Investigative Service, under the direction of Special Agent in Charge Leigh-Alistair Barzey, for their assistance in the investigation.
The government is represented by the Assistant U.S. Attorney David Dauenheimer, Deputy Chief of the U.S. Attorney’s Office Civil Division, and Assistant Attorney General and Section Chief Janine Matton, Deputy Attorney Generals Paul Juzdan, Carla Pereira and Nicholas Kant of the New Jersey Attorney General’s Government & Healthcare Fraud Section.
Counsel for relator: Jennifer M. Carlson Esq., Vineland, New Jersey
Counsel for defendant: Linda D. Hoffa Esq., PhiladelphiaTwo Men Charged with Armed Robbery Spree Spanning Multiple Counties in Northern and Central New JerseyRead the Press Release
NEWARK, N.J. – Two Essex County, New Jersey, men have been charged with robbing six convenience stores at gunpoint in November and December 2017, U.S. Attorney Craig Carpenito announced.
Tione Davis, 35, of East Orange, New Jersey, and Meshach Whagar, 29, of Newark, are charged by complaint with one count of conspiring to commit Hobbs Act robberies, six substantive counts of Hobbs Act robbery, and one count of using a firearm during a crime of violence. Whagar appeared this afternoon before U.S. Magistrate Judge Joseph A. Dickson in Newark federal court and was detained. Davis is expected to make his initial appearance tomorrow.
Both defendants were previously arrested in December 2017 and have been held in state custody on related charges since that time.
According to the documents filed in this case and statements made in court:
The FBI is investigating a string of approximately 20 armed robberies of convenience stores and gas stations that took place throughout New Jersey between November and December 2017. Davis and Whagar are charged with robbing six convenience stores during that time, including locations in Middlesex, Morris, Bergen, Union, Hudson, and Passaic Counties. During those robberies, Davis, while wearing dark clothing and hiding his face with masks or scarves, allegedly brandished a handgun and demanded money from store clerks. After stealing cash from the stores, Davis fled with Whagar, who acted as the getaway driver.
Before being apprehended, the defendants led law enforcement on a high-speed vehicle pursuit in Morris County. Among the items found in their vehicle were two handguns matching the description of those Davis used during the robberies.The Hobbs Act charges each carry a maximum potential penalty of 20 years in prison. The brandishing a firearm charge carries a maximum potential penalty of life in prison and a mandatory minimum sentence of seven years in prison, which must run consecutively to any other prison term. Each count also carries a potential $250,000 fine, or twice the gross gain or loss from the offense.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, with the investigation. He also thanked the Morris, Union, Middlesex, Hudson, Passaic, Bergen, and Essex County Prosecutor’s Offices, as well as the Morris Plains, Springfield, Middlesex, Lodi, Roselle Park, Rahway, Parsippany, Rockaway, Mahwah, Elmwood Park, Bayonne, West Orange, East Brunswick, South River, Edison, Hoboken, Union, Clark, Kearny, Clifton, and Maplewood police departments for their work on this case.
The government is represented by Assistant U.S. Attorneys Heather Suchorsky and Jamari Buxton of the U.S. Attorney’s Office Criminal Division in Newark.
The charges and allegations contained in the complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
Defense counsel:
Davis: Nabil Kassem Esq., Clifton, New Jersey
Whagar: Linda Foster Esq., Newark, New JerseyTwo Men Arrested for Possession of Fentanyl with Intent to DistributeRead the Press Release
TRENTON, N.J. – Two men who were arrested with approximately one kilogram of fentanyl made their initial appearances today in Trenton federal court, U.S. Attorney Craig Carpenito announced.
Arturo Galindo Gil, 36, and Gonzalo Ayona Avila, 41, are charged by complaint with one count of conspiracy to distribute and possess with intent to distribute 400 grams or more of fentanyl. Both men appeared before U.S. Magistrate Judge Tonianne J. Bongiovanni in Trenton federal court and were detained without bail.
According to documents filed in this case and statements made in court:
During a law enforcement investigation of a drug trafficking organization operating in and around Ocean County, New Jersey, law enforcement officers learned that an individual, later identified as defendant Gil, was known to distribute large quantities of controlled substances, including fentanyl. On April 30, 2018, law enforcement officers learned that Gil was allegedly scheduled to be in Ocean County that day and in possession of a large quantity of fentanyl for distribution. Law enforcement officers identified Gil and another individual, later identified as Avila, driving around Little Egg Harbor Township, New Jersey. Law enforcement initiated surveillance of the vehicle and officers with the Little Egg Harbor Township Police Department eventually initiated a traffic stop of the vehicle. They requested consent to search the vehicle and Gil provided signed consent. Law enforcement officers discovered approximately one kilogram of a tightly packaged substance believed to be fentanyl in the back seat of the vehicle. Law enforcement field-tested a sample of the substance and it tested positive for fentanyl.
The fentanyl distribution conspiracy charge carries a mandatory minimum penalty of 10 years in prison, a maximum of life imprisonment, and a $10 million fine.
U.S. Attorney Carpenito credited special agents of the Department of Homeland Security (DHS), Homeland Security Investigations (HSI), Cherry Hill office under the direction of Resident Agent in Charge Richard Reinhold, with the investigation leading to the arrests. He also thanked the Little Egg Harbor Township Police Department, under the direction of Chief Richard J. Buzby Jr.; and the Atlantic City Task Force (including the N.J. State Police, the Atlantic County Prosecutor’s Office, and the Atlantic City Police Department) for their assistance.
The government is represented by Assistant U.S. Attorney Fabiana Pierre-Louis, Attorney-in-Charge of the U.S. Attorney’s Office Trenton Branch.
The charges and allegations contained in the complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
New Jersey Man Sentenced to Eight Years in Prison for Conspiracy to Provide Material Support to ISISRead the Press Release
Samuel Rahamin Topaz, 24, of Fort Lee, New Jersey, was sentenced today to eight years in prison, to be followed by a lifetime of supervised release, for conspiring to provide material support to the Islamic State of Iraq and al-Sham (ISIS), a designated foreign terrorist organization.
The announcement was made by Assistant Attorney General for the National Security John C. Demers, U.S. Attorney Craig Carpenito for the District of New Jersey and Special Agent in Charge Gregory W. Ehrie of the FBI’s Newark, New Jersey Division. Saadeh previously pleaded guilty before U.S. District Judge Susan D. Wigenton to an information charging him with one count of conspiring with others to provide services and personnel to ISIS. Judge Wigenton imposed the sentence today in federal court.
According to documents filed in this and related cases, and statements made in court:
Topaz admitted that prior to his arrest by the FBI Joint Terrorism Task Force on June 17, 2015, he planned to travel overseas to join ISIS and saved money for that purpose. Topaz discussed plans to join ISIS with Nader Saadeh, Alaa Saadeh and Munther Omar Saleh, and he admitted that at various times each of them indicated they wanted to join ISIS. Topaz also admitted that he and the other defendants watched ISIS-related videos, some of which depicted the execution of non-Muslims and individuals regarded as apostates from Islam.
On May 5, 2015, Nader Saadeh departed the United States with plans to travel overseas for the purpose of joining ISIS as part of the conspiracy. Topaz admitted that he and others planned to travel overseas separately, meet up with Nader Saadeh, and then travel together to join ISIS. After Nader Saadeh left the United States, Topaz met with Munther Omar Saleh and contacted Alaa Saadeh to discuss those plans.
Topaz admitted knowing that ISIS was a designated foreign terrorist organization, which he knew to be taking over territory overseas, expelling non-Muslims from their homes, and executing individuals who did not obey ISIS’ commands.
Nader and Alaa Saadeh both pleaded guilty to conspiring to provide material support to ISIS. Alaa Saadeh was sentenced to 15 years in prison on May 10, 2016. Nader Saadeh was sentenced to 10 years in prison on April 30. Saleh and Mumuni both pleaded guilty to related charges brought by the U.S. Attorney’s Office for the Eastern District of New York. Saleh was sentenced to 18 years in prison on Feb. 6. Mumuni was sentenced to 17 years in prison on April 26.
Assistant Attorney General Demers and U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Ehrie in Newark, and the Newark Joint Terrorism Task Force with the investigation. The JTTF is comprised of agents and officers from the U.S. Department of Homeland Security’s Homeland Security Investigations, Bergen County Prosecutor’s Office, Passaic County Prosecutor’s Office, New Jersey State Police, Paterson Police Department, and NYPD, among other federal, state, and local law enforcement agencies.
This case is being prosecuted by Assistant U.S. Attorneys Dennis C. Carletta and Francisco J. Navarro of the District of New Jersey, with assistance from Trial Attorneys Justin Sher and Robert Sander of the National Security Division’s Counterterrorism Section.
Mercer County, New Jersey, Man Sentenced to 21 Months in Prison for Tax EvasionRead the Press Release
NEWARK, N.J. – A Princeton Junction, New Jersey, man was sentenced today to 21 months in prison for failing to report over $1.5 million in income he fraudulently diverted to overseas shell companies, U.S. Attorney Craig Carpenito announced.
Albert Chang, 71, previously pleaded guilty before U.S. District Court Judge William H. Walls to an information charging him with one count of conspiring to evade income taxes and one substantive count of tax evasion. Judge Walls imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
Chang and Michael Q. Fu, 54, of Cranbury Township, New Jersey, co-owned and operated United Products and Instruments Inc. (UNICO) located in Dayton, New Jersey. UNICO was established by Chang and Fu in 1991 and primarily engaged in the sale and export of microscopes and centrifuges for medical purposes.As part of the conspiracy, Chang and Fu created two shell companies headquartered in China – Action Towers and Bench Top Laboratories. Chang and Fu then diverted business income to themselves by funneling money to the shell companies’ bank accounts and deducting the diverted funds from UNICO’s corporate tax return as the cost of goods sold or commission.
In addition, Chang and Fu had Shanghai Electric, a Hong Kong-based utility company, overbill UNICO by approximately five percent on legitimate invoices. Once the invoices were paid by UNICO, they directed Shanghai Electric to wire transfer the overbilled amount to their accounts in China, which they used for their personal benefit. Chang and Fu failed to report any of that income on their federal income tax returns.
In total, Change failed to report $1,559,200, resulting in a tax loss of $237,064. Fu failed to report $1,570,000, resulting in a tax loss of $321,141.
In addition to the prison term, Judge Walls sentenced Chang to three years of supervised release. Restitution will be determined at a later date.
Fu previously pleaded guilty to his role in the conspiracy and was sentenced to 37 months in prison on Jan. 24, 2017.
U.S. Attorney Carpenito credited special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen; special agents of Department of Homeland Security, Homeland Security Investigations, under the direction of Acting Special Agent in Charge Brian Michael; and officers of the Springfield Police Department, under the direction of Chief John Cook, with the investigation.
The government is represented by Senior Litigation Counsel Margaret Ann Mahoney of U.S. Attorney’s Office Criminal Division in Newark.
Defense counsel: Robert Weir Esq., Red Bank, New Jersey
Camden Man in Drug Trafficking Ring Pleads Guilty to Crack Cocaine ChargeRead the Press Release
CAMDEN, N.J. - A Camden man today admitted possessing crack cocaine with the intent to distribute as part of a drug trafficking organization operating in the city of Camden, U.S. Attorney Craig Carpenito announced.
Rajai Gaines, a/k/a “Jigga,” 36, pleaded guilty before U.S. District Judge Renée Marie Bumb to a superseding information charging him with possessing with intent to distribute 28 grams or more of cocaine base.
According to documents filed in this case and statements made in court:
Gaines admitted that he met with two other men to prepare and package more than 300 grams of crack cocaine for distribution. While the meeting was underway, law enforcement officers executed a search warrant at the location, arrested Gaines and the two other men, and seized a large amount of crack, packaging materials, and drug paraphernalia.
The count to which Gaines pleaded guilty carries a mandatory minimum term of five years and a maximum of 40 years in prison. Sentencing is scheduled for Aug. 7, 2018.
Ten members of the drug ring – including Gaines – were initially arrested in June 2017 following a long-term investigation by the FBI, which utilized multiple telephone wiretaps, surveillance, confidential informants, cooperating witnesses, more than 20 controlled drug purchases, a GPS vehicle tracker and four court-authorized search warrants, among other investigative techniques, to uncover the operations of the drug trafficking organization. During the course of the conspiracy, members of the drug trafficking organization distributed crack cocaine, fentanyl, and heroin to users and resellers in and around Camden and to persons cooperating with the FBI. The investigation ultimately led to the seizure of more than 300 grams of crack cocaine, quantities of fentanyl and heroin, a firearm, drug paraphernalia, and recent charges against an eleventh member of the organization.
Charges remain pending against alleged leaders of the drug trafficking organization John Gunther a/k/a “Critty,” 34, and Taleaf Gunther a/k/a “Leafy” and “L,” 32, as well as alleged members William Roland a/k/a “Chill,” 36, Mark Campbell a/k/a “D” and Diz,” 38, Malcolm McCoy, 27, and Davon Leak, 19. The charges and allegations against these defendants are merely accusations, and they are presumed innocent unless and until proven guilty.
Four other defendants – Karim Johnson a/k/a “Chicky,” 38, Daron Suiter, 23, George Williams, 43, and Latoya Whealton a/k/a “Toya,” 33 – have also pleaded guilty and await sentencing.
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 Harpster; the Camden County Police Department, under the direction of Chief J. Scott Thomson; the Camden County Prosecutor’s Office, under the direction of Prosecutor Mary Eva Colalillo; and the N.J. State Police, under the direction of Col. Patrick J. Callahan, with the investigation. He also thanked the Camden County Sheriff’s Department, the Cherry Hill Police Department, and the U.S. Department of Homeland Security Investigations (HSI) for their assistance.
The government is represented by Assistant U.S. Attorney Gabriel J. Vidoni of the U.S. Attorney’s Office Criminal Division in Camden.
Defense counsel: Edward F. Borden Jr. Esq., Cherry Hill, New Jersey
Bergen County, New Jersey, Man Sentenced to Eight Years in Prison for Conspiracy to Provide Material Support to ISISRead the Press Release
NEWARK, N.J. – A Fort Lee, New Jersey, man was sentenced today to 96 months in prison for conspiring to provide material support to the Islamic State of Iraq and al-Sham (ISIS), a designated foreign terrorist organization, U.S. Attorney Craig Carpenito, Assistant Attorney General for National Security John C. Demers, and Special Agent in Charge Gregory W. Ehrie of the FBI’s Newark Division announced.
Samuel Rahamin Topaz, 24, previously pleaded guilty before U.S. District Judge Susan D. Wigenton to an information charging him with one count of conspiring with others to provide services and personnel to ISIS. Judge Wigenton imposed the sentence today in Newark federal court.
According to documents filed in this and related cases and statements made in court:
Topaz admitted that prior to his arrest by the FBI Joint Terrorism Task Force on June 17, 2015, he planned to travel overseas to join ISIS and saved money for that purpose. Topaz discussed plans to join ISIS with Nader Saadeh, Alaa Saadeh, and Munther Omar Saleh, and he admitted that at various times each of them indicated they wanted to join ISIS. Topaz also admitted that he and the other defendants watched ISIS-related videos, some of which depicted the execution of non-Muslims and individuals regarded as apostates from Islam.
On May 5, 2015, Nader Saadeh departed the United States with plans to travel overseas for the purpose of joining ISIS. Topaz admitted that he and others planned to travel overseas separately, meet up with Nader Saadeh, and then travel together to join ISIS. After Nader Saadeh left the United States, Topaz met with Saleh and contacted Alaa Saadeh to discuss those plans.
Topaz admitted knowing that ISIS was a designated foreign terrorist organization that was taking over territory overseas, expelling non-Muslims from their homes, and executing individuals who did not obey ISIS’ commands.
In addition to the prison term, Judge Wigenton sentenced Topaz to a lifetime of supervised release.Nader and Alaa Saadeh both pleaded guilty to conspiring to provide material support to ISIS. Alaa Saadeh was sentenced to 15 years in prison on May 10, 2016. Nader Saadeh was sentenced to 10 years in prison on April 30, 2018. Saleh pleaded guilty to related charges brought by the U.S. Attorney’s Office for the Eastern District of New York and was sentenced to 18 years in prison on Feb. 6, 2018.
U.S. Attorney Carpenito and Assistant Attorney General Demers credited special agents of the FBI, under the direction of Special Agent in Charge Ehrie in Newark, and the Newark Joint Terrorism Task Force with the investigation. The task force is comprised of agents and officers from the U.S. Department of Homeland Security’s Homeland Security Investigations, Bergen County Prosecutor’s Office, Passaic County Prosecutor’s Office, New Jersey State Police, Paterson Police Department, and New York City Police Department, among other federal, state, and local law enforcement agencies.
The government is represented by Assistant U.S. Attorneys Dennis C. Carletta and Francisco J. Navarro of the U.S. Attorney’s Office National Security Unit in Newark, with assistance from Trial Attorneys Justin Sher and Robert Sander of the National Security Division’s Counterterrorism Section.
Defense counsel: Ian J. Hirsch Esq., Hackensack, New Jersey
New Jersey Man Who Traveled Overseas to Join ISIS Sentenced to 10 Years in PrisonRead the Press Release
Nader Saadeh, 23, of Rutherford, New Jersey, was sentenced today to 10 years in prison, to be followed by a lifetime of supervised release, for conspiring to provide material support to the Islamic State of Iraq and al-Sham (ISIS), a designated foreign terrorist organization.
The announcement was made by Assistant Attorney General for the National Security John C. Demers, U.S. Attorney Craig Carpenito for the District of New Jersey and Special Agent in Charge Gregory W. Ehrie of the FBI’s Newark, New Jersey Division. Saadeh previously pleaded guilty before U.S. District Judge Susan D. Wigenton to an information charging him with one count of conspiring with others to provide material support to ISIS. Judge Wigenton imposed the sentence today in Newark federal court.
“ISIS is a threat to the people of the United States, both here and abroad, and the National Security Division will aggressively investigate and prosecute all who seek aid it,” said Assistant Attorney General Demers. “I applaud the dedication of the agents at the FBI and the Newark Joint Terrorism Task Force and the prosecutors here at the Department of Justice, who together thwarted the defendant’s attempt to fight for ISIS against the U.S. and its allies.”
“Saadeh traveled overseas for the sole purpose of joining and fighting for ISIS, an international terrorist organization that has repeatedly taken and threatened to take the lives of our citizens and allies all over the world,” said U.S. Attorney Carpenito. “Thanks to the intervention of the FBI-Newark Joint Terrorism Task Force and federal prosecutors on this case, Saadeh’s criminal aspirations were never realized. Instead of joining ISIS’ ranks, he will spend the next several years in prison.”
“I want to commend the work of the FBI's Joint Terrorism Task Force investigators and prosecutors in the U.S. Attorney's office who worked countless hours throughout this investigation to protect the community in their execution of the FBI's Counterterrorism strategy to detect, penetrate and disrupt potential acts of terrorism in the United States and abroad,” said Special Agent in Charge Ehrie.
According to documents filed in this and related cases and statements made in court:
Saadeh admitted that prior to his arrest on Aug. 10, 2015, by the FBI-Newark Joint Terrorism Task Force (JTTF), he planned to travel overseas to join ISIS along with others. Saadeh discussed his plans to join ISIS with his brother, Alaa Saadeh, Samuel Rahamin Topaz, Munther Omar Saleh and Fareed Mumuni, and admitted that at various times each of them indicated that they wanted to join ISIS. Saadeh also admitted that he and these other men watched ISIS-related videos, some of which depicted the execution of individuals – both Muslim and non-Muslim – regarded by ISIS as enemies.
On May 5, 2015, Saadeh departed the United States with plans to travel overseas to join ISIS in furtherance of the conspiracy, according to his statements in court. Saadeh admitted that once he reached ISIS-controlled territory he intended to fight on behalf of ISIS. Saadeh further admitted that Saleh assisted him by giving him a contact who would facilitate his travel from Turkey to ISIS in Syria.
Saadeh admitted that prior to his departure from the United States, Saleh showed him technical drawings for making homemade bombs. Saadeh admitted that Saleh and Mumuni discussed plans to carry out an attack in ISIS’ name using homemade bombs at locations in New York City, including Times Square, the World Trade Center, and Vaughn College of Aeronautics and Technology, in Queens, New York.
Saadeh admitted knowing that ISIS was a designated terrorist organization and was taking over territory overseas, expelling non-Muslims from their homes and executing individuals who did not obey ISIS’ commands.
Topaz and Alaa Saadeh have also pleaded guilty to conspiring to provide material support to ISIS. Alaa Saadeh was sentenced to 15 years in prison on May 10, 2016. Topaz is set to be sentenced on May 1. Saleh and Mumuni have both pleaded guilty to related charges brought by the U.S. Attorney’s Office for the Eastern District of New York. Saleh was sentenced to 18 years in prison on Feb. 6. Mumuni was sentenced to 17 years in prison on April 26.
Assistant Attorney General Demers and U.S. Attorney Carpenito credited the special agents of the FBI, under the direction of Special Agent in Charge Ehrie in Newark, and the Newark Joint Terrorism Task Force with the successful investigation. The JTTF is comprised of agents and officers from the U.S. Department of Homeland Security’s Homeland Security Investigations, Bergen County Prosecutor’s Office, Passaic County Prosecutor’s Office, New Jersey State Police, Paterson Police Department, and the NYPD, among other federal, state and local law enforcement agencies.
This case is being prosecuted by Assistant U.S. Attorneys Dennis C. Carletta and Francisco J. Navarro of the District of New Jersey, with assistance from Trial Attorneys Justin Sher and Robert Sander of the National Security Division’s Counterterrorism Section.
Fifth Federal Inmate at Fort Dix Admits Possessing Images and Videos of Child Sexual Abuse While in PrisonRead the Press Release
CAMDEN, N.J. – A Fredericksburg, Virginia, man today admitted possessing images of child sexual abuse while imprisoned at Federal Correctional Institution Fort Dix for a previous offense involving the distribution of child pornography, U.S. Attorney Craig Carpenito announced.
Jacob S. Good, 26, pleaded guilty before Senior U.S. District Judge Joseph H. Rodriguez in Camden federal court to an information charging him with one count of possession of child pornography.
According to documents filed in this case and statements made in court:
Good admitted that he possessed a micro SD Card which contained numerous images of child pornography, some of which depicted prepubescent children. In connection with his plea, Good also admitted that he used a smart phone and access to the dark web to view and possess child pornography.
Good and seven other inmates were arrested in April 2017 and February 2018 following an FBI investigation involving multiple covert recordings and several cooperating inmates. The investigation revealed that Good and other inmates utilized contraband cellphones, micro SD cards, and access to the internet to obtain, view, and distribute child pornography within the prison. A co-defendant organized and helped facilitate this criminal activity by maintaining cloud accounts that were used as repositories for child pornography.
At sentencing, Good faces a mandatory minimum term of 10 years in prison and a lifetime of supervised release. Sentencing is scheduled for Aug. 7, 2018.
Four other inmates – Erik M. Smith, 36, of Iron Mountain, Michigan, Anthony C. Jeffries, 32, of Orange, Virginia, Jordan T. Allen, 31, of Plain City, Ohio, and Brian J. McKay, 47, of Brookhaven, Pennsylvania – have also pleaded guilty to possession of child pornography and await sentencing.
Charges remain pending against Christopher D. Roffler, 30, of Virginia Beach, Virginia; William H. Noble, 52, of Lowell, Massachusetts; and Charles Wesley Bush, 38, of Knoxville, Tennessee, all of whom were serving sentences for prior child pornography offenses while committing the alleged crimes in this case. The pending charges and allegations are merely accusations, and these defendants are presumed innocent unless and until proven guilty.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, with the investigation. He also thanked officials of the Bureau of Prisons at Federal Correctional Institution Fort Dix for their assistance.
The government is represented by Assistant U.S. Attorneys Gabriel J. Vidoni and Alyson M. Oswald of the U.S. Attorney’s Office’s Criminal Division in Camden.
Defense counsel: David M. Simon, Esq., Camden
Bergen County, New Jersey, Man Who Travelled Overseas to Join ISIS Sentenced to 10 Years in PrisonRead the Press Release
NEWARK, N.J. – A Rutherford, New Jersey, man was sentenced today to 120 months in prison for conspiring to provide material support to the Islamic State of Iraq and al-Sham (ISIS), a designated foreign terrorist organization, U.S. Attorney Craig Carpenito, Assistant Attorney General for National Security John C. Demers, and Special Agent in Charge Gregory W. Ehrie of the FBI’s Newark Division announced.
Nader Saadeh, 23, previously pleaded guilty before U.S. District Judge Susan D. Wigenton to an information charging him with one count of conspiring with others to provide material support to ISIS. Judge Wigenton imposed the sentence today in Newark federal court.
“Saadeh traveled overseas for the sole purpose of joining and fighting for ISIS, an international terrorist organization that has repeatedly taken and threatened to take the lives of our citizens and allies all over the world,” U.S. Attorney Carpenito said. “Thanks to the intervention of the FBI-Newark Joint Terrorism Task Force and federal prosecutors on this case, Saadeh’s criminal aspirations were never realized. Instead of joining ISIS’ ranks, he will spend the next several years in prison.”
“ISIS is a threat to the people of the United States, both here and abroad, and the National Security Division will aggressively investigate and prosecute all who seek aid it,” said Assistant Attorney General Demers. “I applaud the dedication of the agents at the FBI and the Newark Joint Terrorism Task Force and the prosecutors here at the Department of Justice, who together thwarted the defendant’s attempt to fight for ISIS against the U.S. and its allies.”
"I want to commend the work of the FBI's Joint Terrorism Task Force investigators and prosecutors in the U.S. Attorney's office who worked countless hours throughout this investigation to protect the community in their execution of the FBI's Counterterrorism strategy to detect, penetrate, and disrupt potential acts of terrorism in the United States and abroad," stated Newark FBI Special Agent in Charge Gregory W. Ehrie.
According to documents filed in this and related cases and statements made in court:
Saadeh admitted that prior to his arrest on Aug. 10, 2015, by the FBI-Newark Joint Terrorism Task Force (JTTF), he planned to travel overseas to join ISIS along with others. Saadeh discussed his plans to join ISIS with his brother, Alaa Saadeh, Samuel Rahamin Topaz, Munther Omar Saleh, and Fareed Mumuni, and admitted that at various times each of them indicated that they wanted to join ISIS. Saadeh also admitted that he and these other men watched ISIS-related videos, some of which depicted the execution of individuals – both Muslim and non-Muslim – regarded by ISIS as enemies.
On May 5, 2015, Saadeh departed the United States with plans to travel overseas to join ISIS in furtherance of the conspiracy, according to his statements in court. Saadeh admitted that once he reached ISIS-controlled territory he intended to fight on behalf of ISIS. Saadeh further admitted that Saleh assisted him by giving him a contact who would facilitate his travel from Turkey to ISIS in Syria.
Saadeh admitted that prior to his departure from the United States Saleh showed him technical drawings for making homemade bombs. Saadeh admitted that Saleh and Mumuni discussed plans to carry out an attack in ISIS’ name using homemade bombs at locations in New York City, including Times Square, the World Trade Center, and Vaughn College of Aeronautics and Technology, in Queens, New York.
Saadeh admitted knowing that ISIS was a designated terrorist organization and was taking over territory overseas, expelling non-Muslims from their homes, and executing individuals who did not obey ISIS’ commands.
In addition to the prison term, Judge Wigenton sentenced Saadeh to a lifetime of supervised release.Topaz and Alaa Saadeh have also pleaded guilty to conspiring to provide material support to ISIS. Alaa Saadeh was sentenced to 15 years in prison on May 10, 2016. Topaz is set to be sentenced May 1, 2018. Saleh and Mumuni have both pleaded guilty to related charges brought by the U.S. Attorney’s Office for the Eastern District of New York. Saleh was sentenced to 18 years in prison on Feb. 6, 2018. Mumuni was sentenced to 17 years in prison on April 26, 2018.
U.S. Attorney Carpenito and Assistant Attorney General Demers credited special agents of the FBI, under the direction of Special Agent in Charge Ehrie in Newark, and the Newark Joint Terrorism Task Force with the investigation. The JTTF is comprised of agents and officers from the U.S. Department of Homeland Security’s Homeland Security Investigations, Bergen County Prosecutor’s Office, Passaic County Prosecutor’s Office, New Jersey State Police, Paterson Police Department, and New York City Police Department, among other federal, state, and local law enforcement agencies.
The government is represented by Assistant U.S. Attorneys Dennis C. Carletta and Francisco J. Navarro of the U.S. Attorney’s Office National Security Unit in Newark, with assistance from Trial Attorneys Justin Sher and Robert Sander of the National Security Division’s Counterterrorism Section.
Defense counsel: Frank P. Arleo Esq., West Orange, New Jersey
Asbury Park Doctor Admits Illegally Distributing Steroids, Possessing MarijuanaRead the Press Release
TRENTON, N.J. – A doctor with offices in Asbury Park and Brooklyn today admitted unlawfully distributing prescriptions for anabolic steroids and for possessing marijuana with intent to distribute, U.S. Attorney Craig Carpenito announced.
Kevin Custis, 53, of Belle Mead, New Jersey, pleaded guilty before Judge Peter G. Sheridan in Trenton federal court to an information charging him with one count of distributing anabolic steroids and one count of possessing marijuana with intent to distribute.
According to documents filed in this case and statements in court:
In 2016 and 2017 Custis wrote and delivered numerous prescriptions for various types of anabolic steroids to two patients. He admitted that he knew these prescriptions were not for the treatment of any actual medical condition, but were solely for muscle enhancement, beauty, and muscle building and fitness competitions.
When agents and investigators from the Drug Enforcement Agency searched his home on June 14, 2017, they found more than four kilograms of marijuana and more than 150 grams of tetrahydrocannobinal oil. Custis admitted that he intended to distribute these substances and that he had no authority under any federal or state law or regulation to do so. Custis also admitted that he prepared marijuana products for patients in his home kitchen.
The count of distributing anabolic steroids carries a maximum sentence of 10 years in prison and a $500,000 fine. The count of possessing marijuana carries a maximum sentence of five years in prison and a $250,000 fine. Sentencing is scheduled for Aug. 9, 2018.
U.S. Attorney Carpenito credited investigators for the DEA, under the direction of Special Agent in Charge Valerie A. Nickerson; officers of the Port Authority of New York and New Jersey-Office of the Inspector General, under the direction of Michael Nestor; and the N.J. Division of Consumer Affairs, under the direction of Acting Director Kevin Jespersen, with the investigation leading to today’s guilty plea.
The government is represented by Senior Litigation Counsel David E. Malagold of the U.S. Attorney’s Office Criminal Division.
Defense counsel: Rubin Sinins, Esq., Springfield, New Jersey
Statement of U.S. Attorney Craig Carpenito on Appointment by U.S. District CourtRead the Press Release
“Chief Judge Jose L. Linares notified me that the U.S. District Court has appointed me United States Attorney for the District of New Jersey. I would like to thank the Chief Judge and the Court for the tremendous honor they have bestowed on me with this appointment.
“It is a great privilege for me to return to my roots as a federal prosecutor in New Jersey. Working side by side with the men and women of this great office, we will continue the tradition of fairly and vigilantly pursuing justice in service of the people of New Jersey and the United States.”
Brother and Sister Convicted of Attempting to Steal $3.7 Million with Phony Invoice SchemeRead the Press Release
TRENTON, N.J. – A brother and sister from New Jersey were convicted at trial today of running a multi-million dollar fraudulent invoice scheme, U.S. Attorney Craig Carpenito announced.
Shevandra Verasawmi, 38, of Matawan, New Jersey, and Vishallie Verasawmi, 37, of Green Brook, New Jersey, were found guilty of all four counts of an indictment charging them with one count of conspiracy to commit mail fraud and three counts of mail fraud. The defendants were convicted following a one-week trial before U.S. District Judge Freda L. Wolfson in Trenton federal court. The jury deliberated for one hour before returning its verdict. Both defendants were originally arrested and charged by indictment in July 2017.
According to documents filed in this case and the evidence at trial:
From April 2016 through August 2016, Shevandra and Vishallie Verasawmi defrauded an entity identified in the indictment as “Victim Company 1” into paying shell companies that were incorporated by Shevandra Verasawmi. Despite the fact that the shell companies never had contracts for goods or services with Victim Company 1, Vishallie Verasawmi used her position as an employee of Victim Company 1 to cause the shell companies to be added to Victim Company 1’s accounts payable system.
Shevandra and Vishallie Verasawmi then submitted dozens of fraudulent invoices to Victim Company 1 and ultimately deposited the fraud proceeds into bank accounts they controlled. In total, Shevandra and Vishallie Verasawmi attempted to divert millions of dollars belonging to Victim Company 1 and spent the proceeds on personal expenses, including a luxury car and credit card payments.
The indictment seeks forfeiture of Shevandra and Vishallie Verasawmi’s proceeds from the scheme, including $1,066,830 and a 2016 BMW 750Li xDrive sedan.
The mail fraud conspiracy and mail fraud counts each carry a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Sentencing is scheduled for Aug. 7, 2018.
The investigation was led by special agents with the U.S. Attorney’s Office, District of New Jersey.
The government is represented by Senior Litigation Counsel Daniel V. Shapiro of the U.S. Attorney’s Office Economic Crimes Unit and Assistant U.S. Attorney Dara Aquila Govan of the U.S. Attorney’s Office Cybercrime Unit. Senior Litigation Counsel Barbara A. Ward and Special Assistant U.S. Attorney Kathleen Robeson of the U.S. Attorney’s Office Asset Recovery and Money Laundering Unit are handling the forfeiture aspects of the case.
Defense counsel:
Shevandra Verasawmi: Michael J. Pappa Esq., Hazlet, New Jersey
Vishallie Verasawmi: Lisa Van Hoeck Esq. and Giselle Pomerleau Esq., TrentonTwo New Jersey Men Arrested for Evading Taxes on $5.3 Million Taken from New York Religious OrganizationRead the Press Release
NEWARK, N.J. – Two high-ranking members of the Israelite Church of God in Jesus Christ (ICGJC) were arrested today for allegedly evading taxes on millions of dollars in ICGJC funds that they fraudulently diverted to their sham entertainment company and to one of the defendants for his personal use, U.S. Attorney Craig Carpenito announced.
Jermaine Grant, 43, of Burlington Township, New Jersey, and Lincoln Warrington, 48, of Teaneck, New Jersey, are both charged by indictment with one count of conspiring to defraud the United States. Grant is also charged with five counts of personal income tax evasion. They will appear later this afternoon before U.S. Magistrate Judge Mark Falk in Newark federal court.
According to the indictment:
From January 2007 through April 2016, Grant, the leader of ICGJC, and Warrington, a high-ranking treasurer, allegedly used their positions to divert millions of dollars for Grant’s personal use and benefit.
As part of the scheme, Grant and Warrington allegedly created Black Icon Entertainment (BIE) in order to portray Grant as an entertainment industry mogul whose wealth was derived from his professional success. In fact, BIE virtually conducts no legitimate business and is funded almost exclusively by money taken from the ICGJC. Grant and Warrington funneled approximately $2.4 million in ICGJC funds into BIE, which Grant and Warrington concealed on Grant and BIE’s federal income tax returns.
In addition, Grant allegedly siphoned over $2.9 million in income from the ICGJC through multiple personal expenditures, which Grant and Warrington failed to report as income on Grant’s federal individual tax returns. Grant used an ICGJC debit card to purchase home furnishings, luxury items, designer clothing, real estate, trips to Disneyland and other resorts for his family, multiple high-end vehicles, and private school for some of his children, who were chauffeured in a Mercedes Benz paid for with ICGJC funds.
Altogether, Grant and Warrington allegedly failed to report $5,342,920, in income derived from ICGJC from 2007 through 2015, resulting in a tax loss to the United States of $1,982,470.
Each count in the indictment carries a maximum potential penalty of five years in prison and a $250,000 fine. The charges and allegations in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, and IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen, with the investigation.
The government is represented by Assistant U.S. Attorney Margaret Ann Mahoney of the U.S. Attorney’s Criminal Division in Newark.
Defense counsel:
Grant: Gerald Lefcourt Esq., New York
Warrington: Richard Levitt Esq., New York
Six MS-13 Members with Ties to New Jersey Indicted on Gang-Related Charges, Including Racketeering Conspiracy, Murder, and Multiple Murder ConspiraciesRead the Press Release
NEWARK, N.J. – A grand jury returned a seven-count superseding indictment today charging six members of the violent street gang MS-13, including one who is incarcerated in El Salvador, with various gang-related offenses, including racketeering conspiracy, murder in aid of racketeering, and conspiracy to commit murder in aid of racketeering, Attorney General Jeff Sessions, U.S. Attorney Craig Carpenito, District of New Jersey, Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, Special Agent in Charge Gregory W. Ehrie of the FBI’s Newark Division, Field Office Director John Tsoukaris of the U.S. Immigration and Customs Enforcement’s (ICE) Enforcement and Removal Operations, and Acting Special Agent in Charge Brian Michael of ICE Homeland Security Investigations (HSI) Newark, announced.
Five of the defendants, all citizens of El Salvador, are members or associates of MS-13 sub-units, or “cliques,” operating in Hudson County, New Jersey: Juan Escalante-Melgar, aka “Humilde,” 28, the former leader of the Pinos Locos Salvatrucha clique (the “Pinos clique”); Elmer Cruz-Diaz, aka “Locote,” 29, the former leader of the Hudson Locotes Salvatrucha clique (the “Hudson Locotes clique”); Oscar Sanchez-Aguilar, aka “Snappy,” 22, a member of the Pinos clique; Jose Rivera-Robles, aka “Layo,” 33, a member of the Hudson Locotes clique; and Juan Garcia-Gomez, aka “Scooby,” 22, a Hudson County MS-13 recruit, all of Union City, New Jersey. The sixth defendant, Christian Linares-Rodriguez, aka “Donkey,” 38, is a high-ranking MS-13 member who is currently incarcerated in El Salvador, and who allegedly authorized and directed much of the illegal activity described in the superseding indictment.
“MS-13 is one of the most violent and vicious gangs in America today,” said Attorney General Sessions. “The gang has more than 10,000 members following its barbaric motto of ‘kill, rape, and control’ across 40 states, and that threatens law-abiding Americans. Today’s indictment makes clear that the Trump Administration and this Department will be relentless in taking the fight to MS-13 with every lawful tool at our disposal. I want to thank the FBI, ICE, and DOJ Trial Attorneys for their hard work on this case, part of our aggressive effort to dismantle MS-13 and get its members off our streets for good.”
“Our office has been pursuing and successfully prosecuting the members of the violent transnational gang MS-13 for the crimes they have committed in New Jersey and elsewhere,” U.S. Attorney Carpenito said. “The facts described in the indictment returned today make it clear why: This is a vicious organization with no regard for human life or for the laws of our country. We will continue to focus our resources to ensure that the people of New Jersey are made safe from this violence.”
According to court documents and statements made in court:
The defendants and other Hudson County MS-13 members and associates allegedly engaged in various forms of illegal racketeering activity on behalf of the gang between late 2014 and late 2015. This included: the execution of a suspected rival gang member in West New York, New Jersey, on July 1, 2015, which resulted in Garcia-Gomez, the shooter, becoming eligible to join MS-13; a failed May 2015 plot to kill a member of the rival 18th Street gang, who had been lured to New Jersey by a female MS-13 associate; a plot to kill a member of the Hudson Locotes clique, whom Salvadoran MS-13 leaders had “green-lighted” – or ordered to be killed – because the Hudson Locotes clique member was suspected of violating the gang’s core rule, which prohibits assisting the authorities; extorting the proprietor of a Hudson County restaurant by threatening harm if the proprietor did not pay money to the gang; and conspiring to sell cocaine on behalf of the gang.
The murder and murder conspiracies charged in the superseding indictment are described below:
The July 1, 2015 Murder
Shortly after midnight on July 1, 2015, Garcia-Gomez shot and killed a person identified in the superseding indictment as Victim-3 as the victim was entering an apartment building in West New York. Surveillance cameras mounted outside the apartment building captured the murder from multiple angles. Several angles show a male, later identified as Garcia-Gomez, approach Victim-3 from behind, level a revolver at Victim-3, and then fire a single shot into the back of Victim-3’s head. Additional angles show a male, later identified as Sanchez-Aguilar, watching the murder from across the street, and another male, later identified as Rivera-Robles, lingering close by and meeting with Garcia-Gomez moments after the execution.
Investigators also retrieved surveillance footage showing Garcia-Gomez boarding a bus after the murder, and later, entering a residence in Union City, New Jersey. Investigators visited the Union City residence and located Garcia-Gomez. Investigators also obtained a warrant to search Garcia-Gomez’s residence and recovered, among other things: a pair of distinctive jeans that Garcia-Gomez wore when he committed the murder; and a box of .44-caliber ammunition, which matches the caliber of the bullet recovered from Victim-3’s body.
Through additional investigation, including witness interviews and numerous lawfully recorded telephone conversations, some of which were obtained from the Salvadoran government, investigators discovered that Garcia-Gomez shot and killed Victim-3, a suspected rival gang member, so that he could become a full member of MS-13. The investigation further revealed that Escalante-Melgar – one of the highest-ranking Hudson County MS-13 members at the time – directed Garcia-Gomez to carry out the execution, with Linares-Rodriguez’ approval from El Salvador. Escalante-Melgar also ordered Sanchez-Aguilar and Rivera-Robles to accompany Garcia-Gomez and serve as lookouts. Prior to the murder, Sanchez-Aguilar had been surveilling the victim, while Rivera-Robles and others had test-fired the murder weapon, which belonged to Escalante-Melgar.
The May 2015 Murder Plot
Around May 2015, Hudson County MS-13 members and associates engaged in a plot to kill a member of the rival 18th Street gang from the Maryland/Virginia area, identified in the superseding indictment as Victim-2. The plot involved a female associate of MS-13, identified in the superseding indictment as Co-Conspirator-3, befriending Victim-2, and then luring Victim-2 to the New Jersey area so that MS-13 members could execute Victim-2.
Victim-2 arrived in Hudson County around May 25, 2015. Upon Victim-2’s arrival, Escalante-Melgar ordered three MS-13 members – identified in the superseding indictment as Co-Conspirator-1, Co-Conspirator-2, and Co-Conspirator-4 – to carry out the murder. When their initial attempts to make contact with Victim-2 did not go as planned, the MS-13 members decided to secure a room for Victim-2 at a local motel, and offered to transport Victim-2 back to the Maryland/Virginia area the following day. At Escalante-Melgar’s direction, the MS-13 members agreed to stab the victim to death at some point during the trip, and then dispose of the body.
The murder was foiled the following day when Victim-2 – sensing that the MS-13 members planned to harm Victim-2 – jumped from Co-Conspirator-1’s vehicle outside a tollbooth on the way to the Maryland/Virginia area. The MS-13 members later received beatings for failing to kill the rival 18th Street gang member.
The Suspected Informant Murder Plot
As alleged in the superseding indictment, Salvadoran MS-13 leaders, including Linares-Rodriguez, issued a green light to kill a member of the Hudson Locotes clique suspected of assisting the authorities, identified as Victim-1. Linares-Rodriguez allegedly issued one green light after Victim-1 refused to carry out instructions to kill a member of the rival 18th Street gang in September 2014, and then issued a second green light when Victim-1 was suspected of assisting law enforcement in early 2015. Escalante-Melgar, Cruz-Diaz, and others discussed the kill order on Victim-1, as well as plans to carry out the kill order, which included assigning MS-13 members and associates to surveil Victim-1 in preparation for the murder.
- Count One charges all six defendants with racketeering conspiracy.
- Count Two charges Escalante-Melgar and Linares-Rodriguez with conspiracy to commit murder in aid of racketeering based on the May 2015 Murder Plot.
- Count Three charges Escalante-Melgar, Cruz-Diaz, Sanchez-Aguilar, Rivera-Robles, and Garcia-Gomez with murder in aid of racketeering based on the July 1, 2015 murder.
- Count Four charges all six defendants with conspiracy to commit murder in aid of racketeering based on the July 1, 2015 murder.
- Count Five charges all six defendants with discharging a firearm during a crime of violence, and aiding and abetting that crime.
- Count Six charges Escalante-Melgar, Cruz-Diaz, Sanchez-Aguilar, Rivera-Robles, and Garcia-Gomez with causing death through the use of a firearm based on the July 1, 2015 murder.
- Count Seven charges Escalante-Melgar, Cruz-Diaz, and Linares-Rodriguez with conspiracy to commit murder in aid of racketeering based on the Suspected Informant Murder Plot.
Arraignment will be scheduled at a later date.
The investigation was conducted by special agents of the FBI, under the direction of Special Agent in Charge Ehrie in Newark; U.S. Immigration and Customs Enforcement’s (ICE) Enforcement and Removal Operations, under the direction of Field Office Director Tsoukaris; ICE’s Homeland Security Investigations, Newark, under the direction of Acting Special Agent in Charge Michael; FBI’s Transnational Anti-Gang Unit and the Hudson County Prosecutor’s Office, under the direction of Prosecutor Esther Suarez. The Justice Department’s Office of International Affairs, the Union City Police Department, the West New York Police Department, and North Bergen Police Department also assisted in this investigation.
The government is represented by Assistant U.S. Attorney Jamari Buxton of the U.S. Attorney’s Office for the District of New Jersey’s Criminal Division in Newark and Trial Attorney Matthew Hoff of the DOJ Criminal Division’s Organized Crime and Gang Section.
Six MS-13 Members with Ties to New Jersey Indicted on Gang-Related Charges Including Racketeering Conspiracy, Murder, and Multiple Murder ConspiraciesRead the Press Release
A grand jury in Newark, New Jersey returned a seven-count superseding indictment today charging six members of the violent street gang MS-13 with various gang-related offenses, including racketeering conspiracy, murder in aid of racketeering, and conspiracy to commit murder in aid of racketeering, announced Attorney General Jeff Sessions, Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, U.S. Attorney Craig Carpenito for the District of New Jersey, Special Agent in Charge Gregory W. Ehrie of the FBI’s Newark Division, Field Office Director John Tsoukaris of U.S. Immigration and Customs Enforcement’s (ICE) Enforcement and Removal Operations and Acting Special Agent in Charge Brian Michael of ICE Homeland Security Investigations (HSI) Newark.
Five of the defendants, all citizens of El Salvador, are alleged members and/or associates of MS-13 sub-units, or “cliques,” operating in Hudson County, New Jersey: Juan Escalante-Melgar, aka Humilde, 28, the former leader of the Pinos Locos Salvatrucha clique (the “Pinos clique”); Elmer Cruz-Diaz, aka Locote, 29, the former leader of the Hudson Locotes Salvatrucha clique (the “Hudson Locotes clique”); Oscar Sanchez-Aguilar, aka Snappy, 22, a member of the Pinos clique and Juan Garcia-Gomez, aka Scooby, 22, a Hudson County MS-13 recruit, and Jose Rivera-Robles, aka Layo, 33, a member of the Hudson Locotes clique. The sixth and final defendant, Christian Linares-Rodriguez, aka Burro or Donkey, 38, is a high-ranking MS-13 member who is currently incarcerated in El Salvador, and who allegedly authorized and directed much of the illegal activity described in the superseding indictment.
“MS-13 is one of the most violent and vicious gangs in America today,” said Attorney General Sessions. “The gang has more than 10,000 members following its barbaric motto of ‘kill, rape, and control’ across 40 states, and that threatens law-abiding Americans. Today’s indictment makes clear that the Trump Administration and this Department will be relentless in taking the fight to MS-13 with every lawful tool at our disposal. I want to thank the FBI, ICE, and DOJ Trial Attorneys for their hard work on this case, part of our aggressive effort to dismantle MS-13 and get its members off our streets for good.”
“Our office has been pursuing and successfully prosecuting the members of the violent transnational gang MS-13 for the crimes they have committed in New Jersey and elsewhere,” U.S. Attorney Carpenito said. “The facts described in the indictment returned today make it clear why: This is a vicious organization with no regard for human life or for the laws of our country. We will continue to focus our resources to ensure that the people of New Jersey are made safe from this violence.”
According to the superseding indictment, the defendants and other Hudson County MS-13 members and/or associates engaged in various forms of illegal racketeering activity on behalf of the gang between late-2014 and late-2015. The alleged illegal conduct included: a July 1, 2015 execution of a suspected rival gang member in West New York, New Jersey (the “July 1, 2015 Murder”); a May 2015 plot to stab to death a member of a rival 18th Street gang who was lured into a vehicle but managed to escape (the “May 2015 Murder Plot”); a plot “green lighted” by Salvadoran MS-13 leaders to kill a member of the Hudson Locotes clique who disobeyed an order to kill a rival gang member and was suspected of assisting the authorities (the “Suspected Informant Murder Plot”); an extortion scheme targeting the proprietor of a North Bergen, New Jersey restaurant entailing threats of violence if the proprietor did not pay money to the gang; and a conspiracy to sell cocaine on behalf of the gang.
The murder and murder conspiracies charged in the superseding indictment are described below:
The July 1, 2015 Murder
As alleged in the superseding indictment, on July 1, 2015, Garcia-Gomez shot and killed a suspected rival gang member identified as Victim-3 at Victim-3’s residence in West New York. Garcia-Gomez approached Victim-3 and fatally shot him with a revolver handgun, while Rivera-Robles and Sanchez-Aguilar watched nearby.
The indictment alleges that Garcia-Gomez shot and killed Victim-3 so that he could become a full-member of MS-13. The indictment further alleges that Escalante-Melgar – one of the highest-ranking Hudson County MS-13 members at the time – directed Garcia-Gomez to carry out the execution, with Linares-Rodriguez’s approval from El Salvador. Escalante-Melgar also ordered Sanchez-Aguilar and Rivera-Robles to accompany Garcia-Gomez and serve as lookouts. Prior to the murder, Sanchez-Aguilar had been surveilling the victim, while Rivera-Robles and others had test-fired the murder weapon, which belonged to Escalante-Melgar.
The May 2015 Murder Plot
According to the superseding indictment, around May 2015, Hudson County MS-13 members and/or associates engaged in a plot to kill a member of the rival 18th Street gang from the Maryland/Virginia area, identified as Victim-2. The plot involved a female associate of MS-13, identified in the superseding indictment as Co-Conspirator-3, befriending Victim-2, and then luring Victim-2 to the New Jersey area so that MS-13 members could execute Victim-2.
The indictment alleges that Victim-2 arrived in Hudson County around May 25, 2015 to visit Co-Conspirator-3. Upon Victim-2’s arrival, Escalante-Melgar ordered three MS-13 members to carry out the murder. The three MS-13 members allegedly offered to transport Victim-2 from a motel back to the Maryland/Virginia area and, at Escalante-Melgar’s direction, agreed to stab the victim to death at some point during the trip.
According to the indictment, the murder was foiled when Victim-2 – sensing that the MS-13 members intended harm – jumped from the backseat of the vehicle and escaped.
The Suspected Informant Murder Plot
As alleged in the superseding indictment, Salvadoran MS-13 leaders, including Linares-Rodriguez, issued a green light to kill a member of the Hudson Locotes clique suspected of assisting the authorities, identified as Victim-1. Linares-Rodriguez allegedly issued one green light after Victim-1 refused to carry out instructions to kill a member of the rival 18th Street gang in September 2014, and then issued a second green light when Victim-1 was suspected of assisting law enforcement in early 2015. Escalante-Melgar, Cruz-Diaz, and others discussed the kill order on Victim-1, as well as plans to carry out the kill order, which included assigning MS-13 members and/or associates to surveil Victim-1 in preparation for the murder.
Count one charges all six defendants with racketeering conspiracy. Count two charges Escalante-Melgar and Linares-Rodriguez with conspiracy to commit murder in aid of racketeering based on the May 2015 murder plot. Count three charges Escalante-Melgar, Cruz-Diaz, Sanchez-Aguilar, Rivera-Robles, and Garcia-Gomez with murder in aid of racketeering based on the July 1, 2015 murder. Count four charges all six defendants with conspiracy to commit murder in aid of racketeering based on the July 1, 2015 murder. Count five charges all six defendants with discharging a firearm during a crime of violence, and aiding and abetting that crime. Count six charges Escalante-Melgar, Cruz-Diaz, Sanchez-Aguilar, Rivera-Robles, and Garcia-Gomez with causing death through the use of a firearm based on the July 1, 2015 murder. Count seven charges Escalante-Melgar, Cruz-Diaz, and Linares-Rodriguez with conspiracy to commit murder in aid of racketeering based on the Suspected Informant Murder Plot. The arraignment has not been scheduled.
The investigation was conducted by the FBI, ICE Enforcement and Removal Operations, FBI-led Transnational Anti-Gang Unit, Hudson County Prosecutor’s Office and ICE’s Homeland Security Investigations. The Justice Department’s Office of International Affairs, the Justice Department’s Office of Prosecutorial Development Assistance and Training, the Union City Police Department, the West New York Police Department, and North Bergen Police Department also assisted in this investigation.
The case is being prosecuted by Trial Attorney Matthew Hoff of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorney Jamari Buxton of the U.S. Attorney’s Office for the District of New Jersey.
Philadelphia-Area Political Consultant Pleads Guilty to Tax EvasionRead the Press Release
PHILADELPHIA – A Philadelphia-area political consultant today admitted evading taxes on $393,359 in income from his consulting business, U.S. Attorney Craig Carpenito announced.
William R. Miller V, 44, of Glenside, Pennsylvania, pleaded guilty before U.S. District Judge Joel H. Slomsky to an information charging him with one count of federal tax evasion.
According to documents filed in this case and statements made in court:Miller sought to evade federal income taxes by failing to file tax returns as required under federal law, and by concealing income when he finally did file returns, for tax years 2010 through 2014. During that time, Miller cashed numerous checks issued to him for his Philadelphia-area political consulting work and deposited only a portion of the proceeds into bank accounts. After learning of the IRS investigation, Miller tried to conceal his income in March 2016 by filing federal tax returns for 2010 through 2014, which themselves were false. In all, Miller attempted to evade taxes on $393,359 in personal income, resulting in a $94,233 tax loss to the IRS for tax years 2010 through 2014.
The tax evasion charge is punishable by a maximum potential penalty of five years in prison and a potential fine of $250,000 or twice the gross gain or loss from the offense. Sentencing is scheduled for Aug. 13, 2018.
U.S. Attorney Carpenito credited special agents of IRS-Criminal Investigation, Philadelphia Field Office, under the direction of Acting Special Agent in Charge Guy Ficco; special agents of the FBI, Philadelphia Division, under the direction of Special Agent in Charge Michael Harpster; and special agents of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigation (HSI) Philadelphia, under the direction of Special Agent in Charge Marlon V. Miller, with the investigation leading to today’s guilty plea.
The U.S. Attorney in the Eastern District of Pennsylvania previously recused his office from an investigation involving former Philadelphia District Attorney Rufus Seth Williams, and supervision of that matter was assigned to the U.S. Attorney’s Office for the District of New Jersey. During that separate investigation, Miller’s tax evasion was discovered, and his prosecution is also being supervised by the District of New Jersey. Two prosecutors from the Eastern District of Pennsylvania are assigned to the case, subject to the supervision of the District of New Jersey.
The government is represented by Eric W. Moran, Chief of the Criminal Division-South of the U.S. Attorney’s Office for the District of New Jersey, and Chief of Appeals Robert A. Zauzmer and Assistant U.S. Attorney Vineet Gauri of the U.S. Attorney’s Office for the Eastern District of Pennsylvania.
Defense counsel: Angie Halim Esq., Philadelphia
Morris County, New Jersey, Woman Charged with Smuggling American Aircraft Components to Iranian Airline CompaniesRead the Press Release
NEWARK, N.J. - A Morristown, New Jersey, woman appeared in federal court today to face charges for her alleged role in an international procurement network that smuggled over $2 million worth of aircraft components from the United States to Iran in violation of export control laws, U.S. Attorney Craig Carpenito announced.
Joyce Eliabachus, a/k/a “Joyce Marie Gundran Manangan,” 55, a naturalized U.S. citizen born in the Philippines, was arrested at her home on April 24, 2018, following a joint investigation by the U.S. Department of Homeland Security, Homeland Security Investigations (HSI) and the U.S. Department of Commerce, Office of Export Enforcement.
Eliabachus is charged in a three-count criminal complaint with conspiracy to violate the Iranian Transactions and Sanctions Regulations (ITSR), conspiracy to commit money laundering, and conspiracy to smuggle goods from the United States. She made her initial appearance this afternoon before U.S. Magistrate Judge Mark Falk in Newark federal court and was released on $100,000 unsecured bond with home confinement.
According to the complaint:
Eliabachus – the principal officer and operator of Edsun Equipments LLC, a purported New Jersey-based aviation parts trading company run out of her Morristown residence – is allegedly part of a sophisticated procurement network that has secretly acquired large quantities of license-controlled aircraft components from U.S. manufacturers and vendors, and exported those parts to Iran through freight-forwarding companies located in the United Arab Emirates (UAE) and Turkey, in violation of U.S. export control laws.
From May 2015 through October 2017, Eliabachus and her conspirators facilitated at least 49 shipments containing a total of approximately 23,554 license-controlled aircraft parts from the U.S. to Iran, all of which were exported without the required licenses.
Eliabachus conspired with the owner of an Iranian-based procurement firm, identified in the complaint as “CC-1,” whose international network helped initiate the purchase of U.S.-origin aircraft components on behalf of CC-1’s clients in Iran. The network’s client list was comprised of Iranian airline companies, several of which have been officially designated by the U.S. government as posing a threat to the country’s national security, foreign policy, or economic interests, including Mahan Air Co., Caspian Airlines, and Kish Air, among others.
Using Edsun Equipment in New Jersey, Eliabachus finalized the purchase and acquisition of the requested components from the various U.S.-based distributors. She then re-packaged and shipped the components to shipping companies in the UAE and Turkey, including Parthia Cargo and Reibel Tasimacilik Ve Tic A.S., where her Iranian conspirators directed trans-shipment of the components to locations in Iran.
In order to obscure the extent of the network’s procurement activities, Eliabachus routinely falsified the true destination and end-user of the aircraft components she acquired. She also falsified the true value of the components being exported in order to evade the necessity of filing export control forms, which further obscured the network’s illegal activities from law enforcement.
The funds for the illicit transactions were obtained from the various Iranian purchasers, funneled through Turkish bank accounts held in the names of various shell companies controlled by the Iranian conspirators, and ultimately transferred into one of Edsun Equipments’ U.S.-based accounts. The network’s creation and use of multiple bank accounts and shell companies abroad was intended to conceal the true sources of funds in Iran, as well as the identities of the various Iranian entities who were receiving U.S. aircraft components.
“Eliabachus and others allegedly ran an international smuggling ring that shipped $2 million in aircraft parts to multiple Iranian airlines, including an airline that has provided financial, material, and technological support to the Islamic Revolutionary Guard Corps,” U.S. Attorney Carpenito said. “This arrest, which was made possible by a close collaboration between our office and its partners at Homeland Security Investigations and the Office of Export Enforcement, has snuffed out another source of funds and goods to overseas entities that may endanger our national and economic security.”
“Today’s action is the result of outstanding collaborative efforts by the Office of Export Enforcement, the Justice Department, and Homeland Security Investigations,” Special Agent in Charge Jonathan Carson of the Office of Export Enforcement said. “This arrest will cut-off a key supplier to a proliferation network which illegally sold U.S. origin items to Iran. Violations such as these jeopardize national security and undermine U.S. foreign policy. We will continue to vigorously pursue violators wherever they may be.”
“HSI is committed to leveraging its broad jurisdiction to prevent the illegal exportation of controlled items,” said Brian Michael, Acting Special Agent in Charge for HSI Newark. “This investigation is a culmination of an extensive joint law enforcement effort to dismantle a criminal enterprise. HSI will continue to pursue complex criminal investigations while using our unique statutory authorities to prevent smuggling operations like this that threaten national security.”
The charge of conspiracy to violate the ITSR carries a maximum penalty of 20 years in prison and a $1 million fine. The charge of conspiracy to commit money laundering carries a maximum penalty of 20 years in prison and a $500,000 fine. The charge of conspiracy to smuggle goods carries a maximum penalty of five years in prison and a $250,000 fine.
U.S. Attorney Carpenito credited special agents of Department of Homeland Security, Homeland Security Investigations, under the direction of Acting Special Agent in Charge Michael in Newark, and the U.S. Department of Commerce, Bureau of Industry and Security, Office of Export Enforcement, under the direction of Special Agent in Charge Carson in New York, with the investigation. He also thanked officers of the Morristown Police Department, under the direction of Chief Peter Demnitz, for their assistance.
The government is represented by Assistant U.S. Attorneys Dennis C. Carletta of the U.S. Attorney’s Office National Security Unit and Sarah Devlin of the office’s Asset Recovery and Money Laundering Unit, with assistance from the Department of Justice’s National Security Division, Counterterrorism Section.
Defense counsel: John Yauch Esq., Federal Public Defender, Newark
Illinois Man Sentenced to Seven Years in Prison for Role in Drug Trafficking ConspiracyRead the Press Release
TRENTON, N.J. – A DeKalb, Illinois, man was sentenced today to 84 months in prison for his role in an international drug trafficking organization, U.S. Attorney Craig Carpenito announced.
Henry Zamora, 38, previously pleaded guilty before U.S. District Judge Peter G. Sheridan to the first count of an indictment charging him with conspiracy to distribute heroin. Judge Sheridan imposed the sentence today in Trenton federal court.
According to documents filed in this case and statements made in court:
From June 2014 through December 2014, Zamora engaged in a conspiracy with members of a drug trafficking organization, with cells operating in New Jersey, to transport and distribute bulk quantities of heroin. On Nov. 21, 2014, Zamora was arrested while transporting four kilograms of heroin contained in a hidden compartment in his vehicle. Following the arrest, officers recovered an additional two kilograms of heroin from his home.
In December 2014, co-defendants Dany Francisco-Valerio, 44, and Vionel Rondon-Cortorreal, 29, both of Bronx, New York, conspired with members of the drug trafficking organization to transport and distribute kilogram quantities of heroin. On Dec. 24, 2014, Francisco-Valerio and Rondon-Cortorreal were arrested in Warren County, New Jersey, while transporting 15 kilograms contained in a hidden compartment in a vehicle they were operating. Francisco-Valerio and Rondon-Cortorreal both pleaded guilty before Judge Sheridan to informations charging them with conspiracy to distribute heroin. Francisco-Valerio has been sentenced to 51 months in prison by Judge Sheridan while Rondon-Cortorreal is awaiting sentencing.
Two other members of the conspiracy, Harry Madrid, 26, of Anaheim, California, and his brother, Wilson Madrid, 32, of Norcross, Georgia, previously entered guilty pleas for their roles in conspiring to launder drug proceeds on behalf of the organization. Harry Madrid has been sentenced to 46 months in prison and Wilson Madrid has been sentenced to seven years in prison by Judge Sheridan.
In addition to the prison term, Judge Sheridan sentenced Zamora to five years of supervised release.
U.S. Attorney Carpenito praised special agents of the DEA, Newark Division, under the direction of Special Agent in Charge Valerie A. Nickerson, officers from the N.J. State Police under the direction of Acting Superintendent Colonel Patrick J. Callahan, and officers from the DeKalb (Illinois) Police Department, under the direction of Chief Gene Lowrey, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney Thomas S. Kearney of the U.S. Attorney’s Office OC/Gangs Unit in Newark and Assistant U.S. Attorney Jamari Buxton of the U.S. Attorney’s Office Economic Crimes Unit in Newark.
Defense counsel: Andrea Bergman Esq., Trenton
Union County, New Jersey, Tax Preparer Admits Tax FraudRead the Press Release
NEWARK, N.J. – A Union, New Jersey, woman today admitted preparing fraudulent income tax returns on behalf of her clients, causing losses of over $320,000, U.S. Attorney Craig Carpenito announced.
Toni Ciullo, 43, pleaded guilty before U.S. District Judge Esther Salas in Newark federal court to an information charging her with one count of aiding and assisting others in the preparation of false and fraudulent tax returns.
According to documents filed in this case and statements made in court:
Ciullo was an owner and operator of Full Spectrum Consulting LLC in Union. For tax years 2010 through 2014, Ciullo used a number of fraudulent practices, including increasing claimed losses and credits for certain businesses, increasing her clients’ unreimbursed employee expenses and medical and dental costs, and creating fictitious businesses, all so her clients would receive higher refunds than those to which they were actually entitled. Ciullo admitted that the bogus returns resulted in a tax loss to the government of approximately $322,537.
The charge to which Ciullo pleaded guilty carries a maximum potential penalty of three years in prison and a $250,000 fine. Sentencing is scheduled for Aug. 7, 2018.
U.S. Attorney Carpenito credited special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen, and inspectors with the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Ruth M. Mendonca, with the investigation. He also thanked special agents with the U.S. Secret Service, under the direction of Special Agent in Charge Mark McKevitt in Newark, for their assistance.
The government is represented by Assistant U.S. Attorney Ari B. Fontecchio of the U.S. Attorney’s Office in Newark.
Defense counsel: David Holman Esq., Office of the Federal Public Defender, Newark
Fourth Federal Inmate at Fort Dix Admits Possessing Images and Videos of Child Sexual Abuse While in PrisonRead the Press Release
CAMDEN, N.J. – A Brookhaven, Pennsylvania, man today admitted possessing hundreds of images and videos of child sexual abuse while imprisoned at Federal Correctional Institution Fort Dix for previous offenses involving the distribution and possession of child pornography, U.S. Attorney Craig Carpenito announced.
Brian J. McKay, 47, pleaded guilty before Senior U.S. District Judge Joseph H. Rodriguez in Camden federal court to an information charging him with one count of possession of child pornography.
According to documents filed in this case and statements made in court:
McKay admitted that he possessed two micro SD Cards which together contained a total of approximately 593 images and 645 videos of child pornography, some of which depicted children being sexually abused and sadistic and masochistic sexual conduct involving infants and toddlers. In connection with his plea, McKay also admitted that he distributed child pornography to another inmate.
McKay and seven other inmates were arrested in April 2017 and February 2018 following an FBI investigation involving multiple covert recordings and several cooperating inmates. The investigation revealed that McKay and other inmates utilized contraband cellphones, micro SD cards, and access to the internet to obtain, view, and distribute child pornography within the prison. A co-defendant organized and helped facilitate this criminal activity by maintaining cloud accounts that were used as repositories for child pornography.
At sentencing, McKay faces a mandatory minimum term of 10 years in prison and a lifetime of supervised release. Sentencing is scheduled for Aug. 6, 2018.
Three other inmates – Erik M. Smith, 36, of Iron Mountain, Michigan, Anthony C. Jeffries, 32, of Orange, Virginia, and Jordan T. Allen, 31, of Plain City, Ohio – have also pleaded guilty to possession of child pornography and await sentencing.
Charges remain pending against Christopher D. Roffler, 30, of Virginia Beach, Virginia; Jacob S. Good, 26, of Fredericksburg, Virginia; William H. Noble, 52, of Lowell, Massachusetts; and Charles Wesley Bush, 38, of Knoxville, Tennessee, all of whom were serving sentences for prior child pornography offenses while committing the alleged crimes in this case. The pending charges and allegations are merely accusations, and these defendants are presumed innocent unless and until proven guilty.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, with the investigation. He also thanked officials of the Bureau of Prisons at Federal Correctional Institution Fort Dix for their assistance.
The government is represented by Assistant U.S. Attorneys Gabriel J. Vidoni and Alyson M. Oswald of the U.S. Attorney’s Office’s Criminal Division in Camden.
Defense counsel: John B. Brennan Esq., Camden
Paterson Police Officer Charged with Distributing NarcoticsRead the Press Release
NEWARK, N.J. – An officer with the Paterson Police Department was arrested today for allegedly dealing heroin, crack cocaine, powder cocaine, and marijuana on multiple occasions between October 2017 and April 2018, U.S. Attorney Craig Carpenito announced.
Ruben McAusland, 26, of Paterson, was arrested by federal agents this morning and charged by complaint with distributing and possessing with intent to distribute narcotics. He is scheduled to appear this afternoon before U.S. Magistrate Judge Steven C. Mannion in Newark federal court.
According to the complaint:
Between October 2017 and April 2018, McAusland allegedly sold various types and quantities of narcotics to an individual who was cooperating with law enforcement.
In October 2017, McAusland allegedly sold the individual approximately 35 grams of marijuana, 48 grams of heroin, 31 grams of cocaine, and 31 grams of crack cocaine for $50. In addition, he sold a pound of marijuana to the individual on two separate occasions between November 2017 and January 2018, charging $2,500 for the first sale and $2,400 for the second.
In February 2018, McAusland offered to sell the individual one kilogram of cocaine. Then, on multiple occasions between February 2018 and April 2018, McAusland allegedly sold the individual pills that were made to resemble Percocet doses but were actually made of heroin. McAusland sold the pills to the individual for approximately $7 per pill.
On Feb. 11, 2018, McAusland met the individual in his police vehicle at a supermarket parking lot near the Paterson Police Department headquarters. McAusland handed the individual approximately four sample heroin pills. Afterwards, on various dates in 2018, McAusland sold heroin pills to the individual, including a sale of 1,010 pills on April 1, 2018 for $7,000.
Narcotics distribution carries the following penalties: a mandatory minimum penalty of five years in prison, a maximum potential penalty of 40 years in prison, and a $5 million fine for possessing with intent to distribute 100 grams or more of heroin or 28 grams or more of crack cocaine; a maximum sentence of 20 years in prison and a $1 million fine for possessing with intent to distribute cocaine; and a maximum sentence of five years in prison and a $250,000 fine for possessing with intent to distribute marijuana.
The charge and allegations in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Acting Special Agent in Charge Bradley W. Cohen in Newark, with the investigation leading to today’s arrest. He also thanked the Passaic County Prosecutor’s Office, under the direction of Passaic County Prosecutor Camelia M. Valdes, the Paterson Police Department, under the direction of Paterson Police Director Jerry Speziale and Police Chief Troy Oswald, and the Paterson Police Department Office of Internal Affairs, for their assistance.
The government is represented by Assistant U.S. Attorney Rahul Agarwal, Deputy Chief of the U.S. Attorney’s Office Criminal Division.
Defense counsel: John C. Whipple Esq., Chatham, New Jersey