District of New Jersey

TRENTON, N.J. – A former salesman at Bayway Lumber, a Linden, New Jersey, company that sold commercial and industrial products to numerous public and private entities, today admitted his role in a scheme to defraud customers and lying to a federal grand jury, Acting U.S. Attorney William E. Fitzpatrick announced.

Adam Martignetti, 43, of South River, New Jersey, pleaded guilty before U.S. District Judge Peter G. Sheridan in Trenton federal court to Counts 1 and 6 of an indictment charging him with conspiracy to commit wire fraud and making false declarations before a grand jury.  

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

Martignetti admitted that from 2011 through 2013 he conspired with others to defraud certain Bayway Lumber customers by providing free items to customers’ employees and then recouping the cost of the items (plus additional revenue for Bayway Lumber) by overbilling and fraudulently billing the customers. Martignetti also admitted to supplying lower-quality, less expensive plywood to a customer, but charging for the more expensive, higher-quality plywood the customer had ordered.   
 
Martignetti gave a variety of personal items to employees of some of Bayway Lumber’s customers, including Amtrak, the City of Elizabeth, and the Plainfield Board of Education.  These items included a laptop, several iPads, a camera and sound system, patio furniture, and other merchandise. Under the supervision of Robert Dattilo, president and partial owner of Bayway Lumber, Martignetti then overbilled and fraudulently billed those customers. Dattilo kept a running tally of how much Martignetti and others overbilled and fraudulently billed customers, which many at Bayway Lumber referred to as the “Bank,” to ensure that Bayway Lumber recovered the full cost of the free items. Dattilo previously pleaded guilty to conspiracy to commit mail and wire fraud and was sentenced in July 2016 to 48 months in prison and ordered to pay $708,386 in restitution.

Martignetti also conspired to provide one Bayway Lumber customer, Consolidated Edison Co. of New York Inc. (Con Edison), with lower-quality wood than it ordered and paid for. When Con Edison ordered graded plywood, a type of plywood graded by mills that had met a certain set of specifications, Martignetti, at Dattilo’s instruction, routinely sent plywood that was of a lower grade or not graded at all, including “reject” plywood, but charged Con Edison for the higher-quality plywood that it ordered. 

Martignetti also pleaded guilty to falsely testifying before a federal grand jury while appearing as a witness under oath in March 2013 that he had never given Bayway Lumber items to City of Elizabeth employees for free, and that Elizabeth was never charged for items that were for Elizabeth employees’ personal use.   

The conspiracy to commit wire fraud charge to which Martignetti pleaded guilty carries a maximum penalty of 20 years in prison. The charge of knowingly making false statements before a grand jury guilty carries a maximum penalty of five years in prison. Each count also carries a maximum fine of $250,000 or twice the gross gain or loss associated with the offense, whichever is greatest. Sentencing is scheduled for Sept. 28, 2017.

Acting U.S. Attorney Fitzpatrick credited special agents with the Office of Inspector General, U.S. Department of Housing and Urban Development, under the direction of Special Agent in Charge Christina Scaringi; the Office of Inspector General, Amtrak, under the direction of Special Agent in Charge Michael Waters; and the FBI, under the direction of Special Agent in Charge Timothy Gallagher, with the investigation leading to today’s guilty plea.  

The government is represented by Assistant U.S. Attorney Cari Fais of the U.S. Attorney’s Office Special Prosecutions Division, and Assistant U.S. Attorney Barbara R. Llanes, Chief, General Crimes Unit, of the U.S. Attorney’s Criminal Division, in Newark. 

Defense Counsel: Michael Armstrong Esq., Willingboro, New Jersey

NEWARK, N.J. – A Belleville, New Jersey, man was sentenced today to 41 months in prison for his role in a conspiracy to illegally obtain and distribute oxycodone in New Jersey, Acting U.S. Attorney William E. Fitzpatrick announced.

Rickie Horvath, 56, previously pleaded guilty before U.S. District Judge Esther Salas to an indictment charging him with one count of conspiracy to distribute oxycodone. Judge Salas imposed the sentence today in Newark federal court.

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

Using confidential sources, physical surveillance, and recorded text messages and telephone calls, investigators with the Drug Enforcement Administration (DEA) discovered that members and suppliers of a drug-trafficking organization secured prescriptions for oxycodone and other controlled substances from various doctors in New Jersey, filled them at pharmacies in Belleville and elsewhere, and sold the drugs for a profit. The investigation identified Horvath as a member of the drug trafficking organization.

Horvath admitted that from Feb. 5, 2014 to Aug. 13, 2014, he personally went to various doctors’ offices and obtained prescriptions for pills containing oxycodone, had the prescriptions filled, and sold the pills to members of the conspiracy and others. He said that on a single day in June 2014, he traveled to a doctor’s office in Livingston, New Jersey, where he and two conspirators each obtained a prescription for 60 Endocet pills. Horvath and his conspirators dropped off the three prescriptions to be filled by a pharmacy in East Orange, New Jersey. Horvath admitted that he and his two conspirators then found a fourth conspirator to buy the 180 Endocet pills. Horvath and his conspirators traveled to the East Orange pharmacy with the third conspirator buyer, where Horvath used the fourth conspirator’s money to purchase the filled prescriptions. Horvath and his conspirators then sold the 180 Endocet pills to the fourth conspirator.  
 
Oxycodone is a Schedule II controlled substance – meaning that it has a high potential for abuse, a currently accepted medical use with severe restrictions, and abuse of the drug may lead to severe psychological or physical dependence. The Endocet pills obtained and sold by Horvath each contained 10 milligrams of oxycodone.

In addition to the prison term, Judge Salas sentenced Horvath to three years of supervised release.

Of the 16 people that have been charged in this conspiracy, 13 have been convicted, including the leader, Victoria Horvath, who was sentenced Oct. 20, 2016 to 92 months in prison. Charges against a defendant who died in April 2014 have been dismissed.

Acting U.S. Attorney Fitzpatrick credited the DEA’s New Jersey Division, under the direction of Special Agent in Charge Carl J. Kotowski, with the investigation.

The government is represented by Assistant U.S. Attorney Sara F. Merin of the OCDETF/Narcotics Unit of the U.S. Attorney’s Office in Newark. The principal mission of the OCDETF program, under which this investigation was conducted, is to identify, disrupt and dismantle the most serious drug-trafficking, weapons-trafficking and money-laundering organizations, and those primarily responsible for the nation’s illegal drug supply.

Defense counsel: Damian Conforti Esq., Newark

TRENTON, N.J. – A former employee of a New Jersey based-trucking company was sentenced today to 33 months in prison for stealing more than $3 million by issuing company checks for her own benefit, Acting U.S. Attorney William E. Fitzpatrick announced.
 
Tracey Perrigan, 55, of Sparta, Tennessee, previously pleaded guilty before U.S. District Judge Peter G. Sheridan to Count One of an indictment charging her with wire fraud. Judge Sheridan imposed the sentence today in Trenton federal court.

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

Perrigan was an employee of a company identified in the indictment as “Company A,” the corporate parent of several subsidiary trucking, rigging, and transportation companies. Company A was headquartered in Oceanside, New York, and had a Branchburg, New Jersey, facility where Perrigan worked.

Company A used the “Comchek” system, which enables clients to authorize and monitor fuel and repair expenditures by drivers in remote locations. As part of her duties, Perrigan was responsible for authorizing Comcheks drawn on Company A’s bank account. From March 2007 through August 2015, Perrigan diverted $3.25 million from her employer to an entity identified as “Company B,” a trucking and towing company based in Tennessee that she owned with another person. Company B never conducted any business with Company A.

In addition to the prison term, Judge Sheridan sentenced Perrigan to three years of supervised release. Perrigan must also pay restitution of $3,251,419.65.   

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation.

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: Carol Gillen Esq., Assistant Federal Public Defender, Newark

An Italian national who smuggled counterfeit electronics, including Apple iPhones, iPads and iPods, from China for sale in the U.S. was sentenced today to 37 months in prison.

Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division; Acting U.S. Attorney William E. Fitzpatrick of the District of New Jersey; Acting Special Agent in Charge Debra Parker of Homeland Security Investigations (HSI) in Newark; and Bergen County Prosecutor Gurbir Grewal made the announcement.

Rosario La Marca, 54, a resident of Naples, Italy, pleaded guilty on February 22, before U.S. District Judge Kevin McNulty to Count One of an indictment charging him with conspiracy to traffic in counterfeit goods, to smuggle goods into the U.S., and to structure financial transactions, and Count Two, charging him with trafficking in counterfeit goods. Judge McNulty imposed the sentence today in Newark federal court.

According to facts admitted during the plea, from July 2009 through February 2014,  La Marca, Andreina Becerra, 32, a Venezuelan national, Roberto Volpe, 35, an Italian national, and Jianhua Li, 42, conspired to smuggle into the U.S. from China more than 40,000 electronic devices and accessories bearing counterfeit Apple and Sony trademarks. The estimated manufacturer’s suggested retail prices for an equivalent number of genuine items would have exceeded $15 million. The devices were shipped separately from the labels bearing counterfeit trademarks in order to avoid detection by U.S. Customs and Border Protection. The devices were then labeled and packaged after they passed through customs.

The defendants then re-shipped the devices to conspirators all over the U.S. Proceeds from the sales of the devices were funneled back to the defendants’ accounts in Florida and New Jersey via structured cash deposits – broken into multiple deposits of less than $10,000 each to avoid bank reporting requirements – and a portion of the proceeds was then transferred to conspirators in Italy, further disguising the source of the funds.

The defendants made more than 100 illegal wire transfers totaling more than $1.1 million to Hong Kong to facilitate their criminal activity.  

In addition to the prison term, Judge McNulty sentenced La Marca to one year of supervised release.

Volpe and Becerra have both pleaded guilty to their roles in the scheme and await sentencing. Li has pleaded not guilty. The charges contained in the indictment against him are merely accusations, and he is presumed innocent unless and until proven guilty.

The case was jointly investigated by the HSI Newark Seaport Investigations Group and the Bergen County Prosecutor’s Office Financial Crimes Unit, with significant assistance from Europol and Italy’s Guardia di Finanza.

The government is represented by Senior Litigation Counsel Leslie Schwartz and Assistant U.S. Attorney Sarah Devlin of the District of New Jersey and Trial Attorney Kebharu Smith of the Criminal Division’s Computer Crime and Intellectual Property Section.

NEWARK, N.J. – An Italian national who smuggled counterfeit electronics, including Apple iPhones, iPads and iPods, from China for sale in the United States was sentenced today to 37 months in prison.

Acting U.S. Attorney William E. Fitzpatrick of the District of New Jersey; Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division; Acting Special Agent in Charge Debra Parker of Homeland Security Investigations (HSI) in Newark; and Bergen County Prosecutor Gurbir Grewal made the announcement.

Rosario La Marca, 54, a resident of Naples, Italy, previously pleaded guilty before U.S. District Judge Kevin McNulty to Count One of an indictment charging him with conspiracy to traffic in counterfeit goods, to smuggle goods into the United States, and to structure financial transactions, and Count Two, charging him with trafficking in counterfeit goods. Judge McNulty imposed the sentence today in Newark federal court.

La Marca, Andreina Becerra, 32, a Venezuelan national, Roberto Volpe, 35, an Italian national, and Jianhua Li, 42, a Chinese national currently residing in California, were originally charged in an eight-count indictment in April 2015 with importing and trafficking fake iPhones, iPads and iPods bearing counterfeit Apple trademarks, and fake camcorders bearing counterfeit Sony trademarks, as well as smuggling, structuring and international money laundering.

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

From July 2009 through February 2014, the defendants conspired to smuggle into the United States from China more than 40,000 electronic devices and accessories. The estimated manufacturer’s suggested retail prices for an equivalent number of genuine items would have exceeded $15 million. The devices were shipped separately from the labels bearing counterfeit trademarks in order to avoid detection by U.S. Customs and Border Protection. The devices were then labeled and packaged after they passed through customs.

The defendants then re-shipped the devices to conspirators all over the United States. Proceeds from the sales of the devices were funneled back to the defendants’ accounts in Florida and New Jersey via structured cash deposits – broken into multiple deposits of less than $10,000 each to avoid bank reporting requirements – and a portion of the proceeds was then transferred to conspirators in Italy, further disguising the source of the funds.

The defendants made more than 100 illegal wire transfers totaling more than $1.1 million to Hong Kong to facilitate their criminal activity.  
 
In addition to the prison term, Judge McNulty sentenced La Marca to one year of supervised release.

Volpe and Becerra have both pleaded guilty to their roles in the scheme and await sentencing. Li has pleaded not guilty. The charges contained in the indictment against him are merely accusations, and he is presumed innocent unless and until proven guilty.

The case was jointly investigated by the HSI Newark Seaport Investigations Group and the Bergen County Prosecutor’s Office Financial Crimes Unit, with significant assistance from Europol and Italy’s Guardia di Finanza.

The government is represented by Senior Litigation Counsel Leslie Schwartz and Assistant U.S. Attorney Sarah Devlin of the District of New Jersey and Trial Attorney Kebharu Smith of the Criminal Division’s Computer Crime and Intellectual Property Section.   

Defense Counsel: Scott D. Finckenauer Esq., Fairview, New Jersey

NEWARK, N.J. – A former contractor of the Newark Watershed Conservation and Development Corporation (NWCDC) was sentenced today to 24 months in prison for his role in a bribery and kickback scheme involving an employee and consultant of the NWCDC, Acting U.S. Attorney William E. Fitzpatrick announced.

James Porter, 80, of East Orange, New Jersey, previously pleaded guilty before U.S. District Judge Jose L. Linares to an information charging him with one count of conspiring with Donald Bernard Sr., a former employee and consultant of the NWCDC, and others, to defraud the NWCDC and one count of tax evasion. Judge Linares imposed the sentence today in Newark federal court.

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

Between October 2008 and April 2013, Porter conspired with Bernard to provide Bernard and others with a stream of concealed, undisclosed kickbacks in exchange for Bernard’s assistance in securing business opportunities and payments to two companies operated by Porter: Jim P. Enterprises LLC (JPE) and New Beginnings Environmental Services (NBES), a company in which Bernard was also a partner.

Both JPE and NBES purported to perform landscaping, snow removal, clean-up and sign posting services to the NWCDC from 2008 through 2013. JPE received payments from the NWCDC totaling more than $500,000 and NBES received approximately $290,000 from the NWCDC. Both companies submitted invoices to the NWCDC that were fraudulently inflated to cover kickback payments to Bernard and billed for some services, such as landscaping and snow removal, which were never performed.

Porter passed a stream of kickback payments to Bernard totaling more than $500,000, which was funded by the proceeds JPE and NBES obtained from the NWCDC, including cash withdrawn from the bank accounts of JPE and NBES totaling $378,867; Bernard’s use of an ATM card issued in his name to withdraw at least $74,681 directly from the NBES bank account; Bernard’s use of the NBES ATM card issued in Bernard’s name to pay personal expenses of nearly $5,000; and checks written from the accounts of JPE and NBES totaling $41,650, which were made payable to Bernard, or to companies he controlled, including a consulting company, Bernard & Associates, and the African American Heritage Parade Committee (AAHPC).

In August 2012, Porter also accepted a $5,000 check payable to JPE from Essex Home Improvements, another contractor of the NWCDC for work that was never performed, and delivered the proceeds to Bernard. The payment from Essex Home Improvements was provided to JPE, rather than to Bernard directly, as a means of concealing a kickback from Essex Home Improvements to Bernard.

From 2009 to 2012, Porter failed to report income of $767,750 from the proceeds that JPE and NBES received from the NWCDC. Porter also pleaded guilty to intentionally underreporting income for the 2012 tax year on his personal tax return by $151,603, resulting in tax due and owing of $48,971.

In addition to the prison term, Judge Linares sentenced Porter to two years of supervised release. Porter must also pay restitution of $711,083, which includes $539,583 towards the NWCDC and $171,500 to the IRS.

Bernard was sentenced by Judge Linares on July 13, 2017 to eight years in prison.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI’s Newark Field Office, under the direction of Special Agent in Charge Timothy Gallagher; the Social Security Administration, Office of the Inspector General, Office of Investigations, New York Field Division, under the direction of Special Agent in Charge John Grasso; U.S. Department of Housing and Urban Development Office of Inspector General, Newark office, under the direction of Special Agent in Charge Christina Scaringi; IRS–Criminal Investigation, Newark Field Office, under the direction of Special Agent in Charge Jonathan D. Larsen; and criminal investigators of the U.S. Attorney’s Office, with the investigation. Acting U.S. Attorney Fitzpatrick also thanked the N.J. Office of the State Comptroller, under the direction of State Comptroller Philip James Degnan, for its assistance.

The government is represented by Assistant U.S. Attorneys Jacques S. Pierre and Jihee G. Suh of the U.S. Attorney’s Office Special Prosecutions Division in Newark.

Defense counsel: Anthony Mack Esq., Newark

NEWARK, N.J. – A Monsey, New York, man was sentenced today to 13 months in prison for assaulting a woman on a flight from Israel to Newark Liberty International Airport, Acting U.S. Attorney William E. Fitzpatrick announced.

 

Yoel Oberlander, 36, previously pleaded guilty before U.S. District Judge Esther Salas to a superseding information charging him with assault with intent to commit stalking. Judge Salas imposed the sentence today in Newark federal court.

 

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

 

Oberlander admitted that while on an El Al flight from Tel Aviv to Newark on May 29, 2016, he knowingly and intentionally assaulted a woman seated next to him on the plane. He admitted that he touched her in the area of her chest, upper thigh, and hand without her consent, and that he did so with the intent to harass and intimidate her.

 

In addition to the prison term, Judge Salas sentenced Oberlander to three years of supervised release.

 

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, and the Port Authority of New York-New Jersey, with the investigation.

The government is represented by Assistant U.S. Attorneys Melissa M. Wangenheim and Joyce M. Malliet of the U.S. Attorney’s Criminal Division in Newark.

Defense counsel: Eric Kanefsky Esq., Newark

TRENTON, N.J. – A Trenton man was sentenced today to 60 months in prison for his role in a conspiracy to sell more than 1.5 kilograms of cocaine and more than 87 grams of crack-cocaine in the Trenton area, Acting U.S. William E. Fitzpatrick announced.

William Enmond, 53, previously pleaded guilty before U.S. District Judge Michael A. Shipp to an information charging him with one count of conspiracy to distribute and possess with intent to distribute 500 grams or more of cocaine, and to manufacture, distribute, and possess with intent to distribute 28 grams or more of cocaine base. Judge Shipp imposed the sentence today in Trenton federal court.

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

From September 2013 through his arrest on Jan. 13, 2016, Enmond conspired with co-defendants Bobby Williams, Khalfini Richardson and Capitol T. Wellons to distribute cocaine and crack-cocaine, primarily from two adjacent residences in Trenton. On Sept. 6, 2013, Enmond sold 446.5 grams of cocaine to a confidential informant in exchange for $17,320.

During his plea hearing, Enmond admitted conspiring to distribute and possess with intent to distribute 1.72 kilograms of cocaine and 87.9 grams of crack-cocaine.

Judge Shipp also sentenced Enmond to five years of supervised release.

Acting U.S. Attorney Fitzpatrick credited special agents of the Drug Enforcement Administration (DEA), under the direction of Special Agent in Charge Carl J. Kotowski in Newark, and detectives of the Mercer County Prosecutor’s Office, under the direction of Prosecutor Angelo J. Onofri, with the investigation.

The government is represented by Assistant U.S. Attorneys Molly Lorber and Joseph Gribko of the U.S. Attorney’s Office Criminal Division in Trenton.

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

Defense counsel: Mark G. Davis Esq., Hamilton, New Jersey

NEWARK, N.J. – A member of the International Longshoremen’s Association (ILA) and general foreman for a Port Elizabeth terminal operator was arrested this morning for fraudulently collecting a nearly $500,000 annual salary, much of which was for work he never performed, Acting U.S. Attorney William E. Fitzpatrick announced.

Paul Moe Sr., 66, of Atlantic Highlands, New Jersey, is charged in an indictment with one count of wire fraud conspiracy and 13 substantive counts of wire fraud. He appeared this afternoon before U.S. Magistrate Judge Leda Dunn Wettre in Newark federal court and was released on $250,000 unsecured bond. He will be arraigned at a later date.

According to the indictment:

From September 2015 through March 2017, Moe fraudulently collected a compensation package that paid him almost $500,000 annually while showing up at his job site for as little as eight hours per week. In order for Moe to collect his $9,300 weekly paycheck, other conspirators submitted false timesheets each day on his behalf and even credited him for up to 16 hours of overtime a day. The 13 substantive wire fraud counts consist of one-week increments in which Moe – having either failed to appear at the job site or while being out of state or out of the country – was paid as if he had been on the job for a minimum of 40 hours a week.

Each count is punishable by up to five years in prison and a $250,000 fine. The charges and allegations in the indictment are merely accusations, and Moe is presumed innocent unless and until proven guilty.

Acting U.S. Attorney Fitzpatrick credited special agents and investigators with the U.S. Department of Labor Office of Inspector General, Office of Investigations-Labor Racketeering and Fraud, New York Region, under the direction of Special Agent in Charge Michael C. Mikulka; the Office of Employee Benefit Security Act (EBSA), under the direction of Regional Director Jonathan Kay, the Waterfront Commission of New York Harbor, under the direction of Executive Director Walter M. Arsenault, and the Office of Labor Management Standards, under the supervision of District Director Andriana Vamvakas, with the investigation.

The government is represented by Senior Litigation Counsel V. Grady O’Malley and Special Assistant U.S. Attorney Tracey Agnew.

Defense counsel: Gerald McMahon Esq., New York

TRENTON, N.J. –The owner of a New Jersey trucking company today admitted committing tax evasion and bankruptcy fraud while operating his wine delivery business, Acting U.S. Attorney William E. Fitzpatrick announced.

Giacomo Giorlando, 54, of Morganville, New Jersey, pleaded guilty before U.S. District Judge Peter G. Sheridan in Trenton federal court to an information charging him with three counts of tax evasion and one count of bankruptcy fraud.

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

As an owner of 4 G’s Trucking, Giorlando comingled business revenue with his personal funds, utilized a check casher to cash business checks, deposited the proceeds of his business into various bank accounts, and then significantly inflated expenses to reduce his taxable income for the years 2011, 2012 and 2014. He admitted he was responsible for a $460,012 tax loss from those three years.

In addition, when Giorlando filed for bankruptcy in May 2014, he failed to accurately report his assets from at least 10 accounts at TD Bank and one account at Provident Bank that he maintained during the time frame covered by the bankruptcy. The bankruptcy was approved based upon this false and incomplete information. He was discharged on March 13, 2015.

The tax evasion and bankruptcy charges each carry a maximum potential penalty of five years in prison and a $250,000 fine. Sentencing is set for Nov. 17, 2017.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher, and IRS–Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen, with the investigation.

The government is represented by Senior Litigation Counsel V. Grady O’Malley of the U.S. Attorney’s Office’s Criminal Division in Newark.

Defense counsel: Rocco C. Cipparone Jr. Esq., Haddon Heights, New Jersey

NEWARK, N.J. – A New Brunswick, New Jersey, man today admitted defrauding a bank by fraudulently using a federally-backed $2 million small business loan on personal expenses, Acting U.S. Attorney William E. Fitzpatrick announced.

John Cheng, 58, of New Brunswick, New Jersey, pleaded guilty before U.S. District Judge Claire C. Cecchi in Newark federal court to an information charging him with loan application fraud.

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

On Dec. 7, 2007, Cheng submitted a Small Business Administration (SBA) loan application for $1.75 million and a commercial loan application for $2 million, purportedly for financing relating to a restaurant in Skillman, New Jersey.

The loan applications were submitted to an independent lender through the SBA Loan Guaranty Program, which authorizes the SBA to provide financial assistance to eligible small businesses through loan guarantees to participating lenders. Rather than loan money directly to small businesses, the SBA provided a guaranty to the independent lender that the SBA would repay a percentage of a loan in the event that a borrower defaulted.

Cheng’s SBA loan application falsely stated that the loan would be used for construction, acquisition of machinery and equipment, and working capital. After receiving $2,082,229 from the victim bank in March 21, 2008, Cheng used the funds for his own benefit, including paying off gambling debts, sending money to family members, and paying a federal tax bill.

The charge to which Cheng pleaded guilty is punishable by a maximum potential penalty of 30 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Under his plea agreement, Cheng must pay restitution of $2,657,687.15 to the bank he defrauded and forfeit $1,696,506. Sentencing is scheduled for Oct. 25, 2017.

 

Acting U.S. Attorney William E. Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation. He also thanked the U.S. Small Business Administration’s Office of Inspector General, Eastern Region, under the direction of Special Agent in Charge Kevin Kupperbusch, and the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), under the direction of Special Inspector General Christy Romero, for their assistance.

The government is represented by Assistant U.S. Attorney Jacob T. Elberg, Chief of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark.

Defense counsel: Steven D. Altman Esq., New Brunswick, New Jersey

CAMDEN, N.J. – The former general counsel of VO Financial Corp. was sentenced today to 12 months in prison for conspiring to obstruct justice in a federal criminal case tried in 2013, Acting U.S. Attorney William E. Fitzpatrick announced.

Joshua L. Gayl, 37, of Lafayette Hill, Pennsylvania, previously pleaded guilty before U.S. District Judge Noel L. Hillman to an information charging him with one count of conspiracy to obstruct justice. Judge Hillman imposed the sentence today in Camden federal court.

According to documents filed in this and other cases and statements made in court:

Adam and Ashley Lacerda, Ian Resnick, and several others were charged in April 2012 with conspiracy to commit mail and wire fraud based on their actions at the Vacation Ownership Group, which offered phony consulting services to owners of timeshares. After they were charged, the VO Group became VO Financial, and Gayl was hired as general counsel. The Lacerdas continued to run VO Financial through their July 2013 criminal trial.

Gayl admitted misleading a witness, identified as “Victim 1,” after he learned that Victim 1 had told the FBI about being defrauded by the VO Group.

Gayl contacted Victim 1 intending to obtain statements favoring the defense in the criminal case, but he concealed his true intentions from Victim 1. Instead, he wrote Victim 1 offering assistance if Victim 1 would tell him what Victim 1 told the FBI. Gayl and an accomplice then called Victim 1 and misleadingly said that they were recording the call for quality assurance and training purposes, when in fact they were trying to get Victim 1 on tape making statements favorable to the defense. Victim 1 told Gayl that the VO Group had promised to sell Victim 1’s timeshare, a VO Group misrepresentation alleged in the indictment. Gayl omitted this allegation when he told Victim 1 what was alleged in the criminal case. Although he did not know what the VO Group representative actually told Victim 1, Gayl told Victim 1 that “we do not sell timeshares” and that Victim 1 had some “confusion” in recalling a promise to sell Victim 1’s timeshare.

Gayl ended the call and consulted with Adam Lacerda. Gayl then called Victim 1 back at Lacerda’s request to persuade Victim 1 that Victim 1’s recollection was mistaken – but Gayl did not tell Victim 1 that his purpose was to get recorded statements to help the criminal defense. Gayl told Victim 1 in the second call that it was “likely” and “logical” that Victim 1 had misunderstood that the VO Group sold timeshares.

Gayl also helped the defendants send potential trial witnesses payments intended to influence their testimony. Adam and Ashley Lacerda wanted these refunds paid to help the defense case at trial and make the recipients testify more favorably to the defense, but Gayl did not tell the potential witnesses that these were the purposes of the payments. Gayl wrote a letter urging “Victim 2” to take a refund, knowing that Resnick wanted Victim 2 to take the refund because Victim 2 was a potential trial witness against Resnick. A month before trial, Gayl wrote letters offering refunds to “Victim 3” and “Victim 4,” but failed to tell them that they were being offered refunds because they were potential trial witnesses.

Gayl also lied in responding to a trial subpoena asking VO Financial to produce records. After Adam Lacerda’s criminal lawyer told the U.S. Attorney’s Office and Gayl that he had advised Lacerda not to be involved in the subpoena response, Gayl told Adam Lacerda about one subpoenaed recording harmful to the defense and saw Lacerda access the recording. Lacerda deleted the damaging portion of the recording. When Gayl gave the U.S. Attorney VO Financial’s response to the subpoena, he included the altered recording and a false certification that he did not consult with Lacerda about the subpoena response. Gayl subsequently listened to the recording and realized that Lacerda had altered it.

In addition to the prison sentence, Judge Hillman sentenced Gayl to three years of supervised release and ordered him to pay a $5,000 fine.

Adam Lacerda, Ashley Lacerda, and Ian Resnick were convicted of conspiracy to commit mail and wire fraud and other offenses. Adam Lacerda was sentenced in June 2015 to 27 years in prison. Ian Resnick was sentenced to 18 years in prison in April 2016. Ashley Lacerda was sentenced to six years in prison in June 2016.

Acting U.S. Attorney Fitzpatrick credited agents of the FBI’s Atlantic City Resident Agency, under the direction of Special Agent in Charge Timothy Gallagher in Newark; and special agents from the Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigation, New York Region, under the direction of Special Agent in Charge Michael C. Mikulka, with the investigation.

The government is represented by Assistant U.S. Attorney R. David Walk Jr. of the U.S. Attorney’s Office in Camden.

Defense counsel: Ellen C. Brotman, Esq., Philadelphia

CAMDEN, N.J. – The owner of KLA International Inc., Quad Trade Services Inc., and TCI Technologies Inc., was sentenced today to 60 months in prison for his role in a conspiracy to defraud approximately 40 businesses out of more than $1 million, Acting U.S. Attorney William E. Fitzpatrick announced.

Keith B. Fisher Sr., 59, of Philadelphia, previously pleaded guilty before U.S. District Judge Renée Marie Bumb to a superseding information charging him with one count of conspiracy to commit mail fraud. Judge Bumb imposed the sentence today in Camden federal court.

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

From February 2010 through August 2015, Fisher and his conspirators, through the use of three purported commercial supply companies, bid on federal contracts through FedBid.com, an online marketplace that provided reverse auction services and enabled government agencies to post requirements for goods or services with the intention of attracting quotes and offers from vendors. Upon submitting a winning bid, Fisher’s companies were awarded contracts to provide goods to the respective government agency.

Fisher and his conspirators orchestrated the fraud by subcontracting with third-party vendors throughout the United States to provide these goods to the respective government agencies. Fisher and his conspirators induced the third-party vendors to ship the goods to the government agencies on credit by falsely promising to pay the vendors for the goods and making false and fraudulent representations to the vendors about the credit-worthiness, business history, and financial status of Fisher’s companies. Fisher and his conspirators provided the vendors with fraudulent credit applications, false trade references, and fraudulent information about the financial status of his companies. Upon receipt of the goods and materials supplied by the third-party vendors, the government agencies paid Fisher and his conspirators. Fisher, in turn, failed to pay or only made nominal payments to the 40 victim vendors, who were owed more than $1 million for the goods and materials supplied to the government.

In addition to the prison term, Judge Bumb sentenced Fisher to three years of supervised release and ordered him to pay restitution of $1,176,168.89.

Acting U.S. Attorney Fitzpatrick credited special agents with the U.S. Department of the Interior, Office of Inspector General, under the direction of Special Agent in Charge Michael V. Graziano, special agents with the U.S. Naval Criminal Investigative Service - Northeast Field Office, under the direction of Special Agent in Charge Leo S. Lamont, special agents with the U.S. Army Criminal Investigation Command - Mid-Atlantic Fraud Field Office, under the direction of Special Agent in Charge L. Scott Moreland, special agents with the Department of Veterans Affairs, Office of Inspector General - Northeast Field Office, under the direction of Special Agent in Charge Donna L. Neves, special agents from the U.S. Department of Justice, Office of Inspector General - Fraud Detection Office, under the direction of Special Agent in Charge Lewe Sessions, and Postal Inspectors with the United States Postal Inspection Service, under the direction of Inspector in Charge Daniel B. Brubaker in Philadelphia, for conducting the investigation leading to today’s sentencing.

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

Defense counsel: Keith B. Fisher Sr., Pro Se

TRENTON, N.J. – A Trenton man was sentenced today to 74 months in prison for his role in a drug trafficking organization that allegedly distributed hundreds of grams of heroin in Trenton and the surrounding area, Acting U.S. Attorney William E. Fitzpatrick announced today.

Elijah Abdullah, a/k/a “Uncle E,” a/k/a “E,” 21, previously pleaded guilty before U.S. District Judge Freda L. Wolfson to an information charging him with conspiracy to distribute and possess with intent to distribute 100 grams or more of heroin. As part his guilty plea, Abdullah admitted to possessing one or more firearms during the conspiracy. Judge Wolfson imposed the sentence today in Trenton federal court.

In December 2016, Abdullah and nine other members of a drug trafficking organization operating in Trenton were charged by criminal complaint with conspiracy to distribute heroin. The complaint referred to the drug trafficking organization as the “Abdullah DTO,” after its leader and Elijah Abdullah’s brother, Ishmael Abdullah.

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

From June 2015 through December 2016, Elijah Abdullah and others engaged in a drug trafficking organization that operated in the area of Spring and Passaic Streets in Trenton.

Through the authorized interception of telephone calls and text messages, controlled purchases of heroin, the use of confidential sources of information, and other investigative means, law enforcement learned that Ishmael Abdullah was a leader of the Abdullah DTO, and was responsible for obtaining significant quantities of heroin from multiple suppliers, including Jose Joaquin Torres-Mezquita and Ileana Sanchez. Ishmael Abdullah and Keith Hunter coordinated the organization’s distribution of heroin through themselves and other conspirators, including Elijah Abdullah.

Members of the Abdullah DTO used temporary prepaid phones, stash houses and cars, and spoke in code to avoid detection by law enforcement. In connection with the narcotics conspiracy, Elijah Abdullah and other members of the Abdullah DTO maintained joint access to multiple firearms.

In addition to the prison term, Judge Wolfson sentenced Abdullah to five years of supervised release.

Acting U.S. Attorney Fitzpatrick credited agents and officers with the Greater Trenton Safe Streets Task Force, including special agents of the FBI, Newark Division, Trenton Resident Agency, under the direction of Special Agent in Charge Timothy Gallagher; special agents of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), Newark Division, Trenton Field Office, under the direction of Acting Special Agent in Charge Lawrence J. Panetta; officers of the Trenton Police Department, under the direction of Director Ernest Parrey Jr.; officers of the Princeton Police Department, under the direction of Chief of Police Nicholas Sutter; officers of the Ewing Police Department, under the direction of Chief of Police John P. Stemler III; and detectives of the Mercer County Prosecutor’s Office, under the direction of Mercer County Prosecutor Angelo J. Onofri, with the investigation.

He also thanked special agents of the FBI’s Philadelphia Field Office, under the direction of Special Agent in Charge Michael Harpster; special agents of Homeland Security Investigations, under the direction of Acting Special Agent in Charge Brian A. Michael; officers of the N.J. State Police, under the direction of Superintendent Col. Joseph R. Fuentes; and officers of the Mercer County Sheriff’s Office, under the direction of Sheriff John A. Kemler, for their assistance in the case.

The government is represented by Assistant U.S. Attorney J. Brendan Day of the U.S. Attorney’s Office’s Criminal Division in Trenton.

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

Defense counsel: Michael A. Armstrong, Willingboro, New Jersey

NEWARK, N.J. - Three Georgia men and a New Jersey woman were charged today with conspiring to illegally sell numerous firearms bound for New Jersey, including an assault rifle with a 75-round magazine and multiple handguns with extended magazines, Acting U.S. Attorney William E. Fitzpatrick announced.

 

Tyheed Jefferson, 33, a/k/a “Solo,” of Albany, Georgia, Mathias Connor, 41, of Atlanta, Georgia, and Nakiya Glenn, 28, of Irvington, New Jersey, are charged by criminal complaint with one count of unlawfully selling firearms to an individual that they knew did not reside in their state of residence, namely Georgia. Tyheed Jefferson was also charged with three counts of possession of a firearm by a convicted felon and one count of methamphetamine distribution.

Carnell Jefferson, 25, of Albany, is charged in a separate complaint with conspiracy to engage in the business of unlicensed firearms dealing.

Tyheed Jefferson and Carnell Jefferson were arrested this morning and will appear this afternoon before U.S. Magistrate Judge Thomas Q. Langstaff in Albany federal court. Glenn will appear this afternoon before U.S. Magistrate Judge Leda Dunn Wettre in Newark federal court. Connor is still at large.

According to the complaints:

 

From January 2017 through July 2017, Tyheed Jefferson, Connor, and Glenn were part of a gun tracking ring that used “straw purchasers” to buy and transport firearms in Georgia. Connor allegedly assisted Tyheed Jefferson – the alleged leader of the ring – with the acquisition, transport and storage of the firearms in Georgia. On at least two occasions, the firearms were sold in Georgia, knowing that they were being transported to New Jersey. On at least five other occasions, the firearms were purchased in Georgia and then sold in New Jersey. Glenn stored some of those firearms at her residence in Irvington.

 

In addition, Tyheed Jefferson is charged with distributing methamphetamine, which he sold during a sale of five firearms on May 24, 2017.

 

From October 2014 through July 2016, Carnell Jefferson allegedly purchased numerous firearms at federally licensed firearms dealers in Albany and Leesburg, Georgia, on behalf of another conspirator, knowing that the firearms would be transported to New Jersey. Jefferson was paid $50 per firearm. Firearms purchased by Carnell Jefferson were later recovered in New Jersey in relation to criminal activity between December 2014 and January 2017.

In total, the investigation recovered 47 illegal firearms, including assault rifles, revolvers, semi-automatic handguns, a shotgun, and numerous rounds of ammunition.

 

The counts of conspiracy to deal in firearms without a license and conspiracy to engage in the business of unlicensed firearms dealing each carry a maximum potential penalty of five years in prison and a $250,000 fine. The count of possession of firearms by a convicted felon carries a maximum penalty of 10 years in prison and a $250,000 fine. The count of distribution of methamphetamine carries a maximum potential penalty of 20 years in prison.

 

Acting U.S. Attorney Fitzpatrick credited special agents of the ATF, under the direction of Acting Special Agent in Charge Lawrence J. Panetta, Newark Field Division, and Special Agent in Charge Wayne L. Dixie, Atlanta Field Division, as well as the N.J. Department of Corrections, under the direction of Commissioner Gary M. Lanigan and the N.J. State Parole Board, under the direction of Chairman James Plousis, with the investigation leading to today’s charges.

 

The government is represented by Senior Litigation Counsel Robert Frazer of the U.S. Attorney's Organized Crime/Gang Unit in Newark.

 

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

 

NEWARK, N.J. – A Miami man was sentenced today to 17 months in prison for depositing over $4.7 million in fraudulently obtained tax refund checks as part of a massive stolen identity income tax scheme, Acting U.S. Attorney William E. Fitzpatrick announced.

 

Roberto Diaz, 48, formerly of Demarest, New Jersey, previously pleaded guilty before U.S. District Judge Claire C. Cecchi to an information charging him with one count of conspiracy to commit theft of government funds, one count of theft of government funds, and one count of aggravated identity theft. Judge Cecchi imposed the sentence today in Newark federal court.

 

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

 

Members of the conspiracy obtained personal identifiers, such as dates of birth and Social Security numbers, belonging to Puerto Rican citizens. Afterwards, they completed Individual Income Tax Return 1040 Forms using the fraudulently obtained information and made it appear that the “taxpayers” listed on the fraudulent returns were entitled to refunds. They also directed the U.S. Treasury Department to issue refunds to locations they could control or access in various ways.

 

At his plea hearing, Diaz admitted that he received fraudulently obtained refund checks and deposited them into banks accounts he controlled or were in the names of his associates or their companies. Diaz also admitted that he and others conspired to bribe a mail carrier to intercept refund checks before they were delivered to the people who had their identity stolen as part of the scheme.

 

Diaz admitted that during the course of the conspiracy, he was responsible for depositing or causing the deposit of over $4.7 million in fraudulently obtained tax refund checks.

 

In addition to the prison term, Judge Cecchi sentenced Diaz to three years of supervised release and ordered him to pay restitution of $4,773,043.43.

Diaz was previously charged in September 2012 along with 13 other defendants in multiple, separate criminal complaints. The $65 million scheme involved more than 8,000 fraudulent income tax returns and losses to the United States of over $12 million.

 

By tracing the specific IP addresses from which the returns were submitted, law enforcement officers identified that only a handful of IP addresses were responsible for filing the fraudulent returns. During the course of the investigation, law enforcement identified certain “hot spots” of activity and intercepted more than $22 million in fraudulently claimed refunds before they were delivered to members of the conspiracy.

 

Acting U.S. Attorney Fitzpatrick credited special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen; postal inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge James V. Buthorn; special agents of the U.S. Secret Service, under the direction of Special Agent in Charge Mark Mckevitt; special agents of the the Drug Enforcement Administration, under the direction of Special Agent in Charge Carl J. Kotowski, and special agents of U.S. Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Acting Special Agent in Charge Brian A. Michael, with the investigation.

 

The government is represented by Assistant U.S. Attorney Zach Intrater of the U.S. Attorney’s Office Economic Crimes Unit in Newark.

 

Defense counsel: Paul Brickfield Esq., River Edge, New Jersey

TRENTON, N.J. - A physician who ran a medical office in Parlin, New Jersey, was sentenced today to 37 months in prison for structuring over $1.4 million in order to avoid reporting requirements, Acting U.S. Attorney William E. Fitzpatrick announced.

 

Joseph A. Spinapolice, 73, of Palm Coast, Florida, previously pleaded guilty before U.S. District Judge Freda L. Wolfson to an information charging him with structuring financial transactions. Judge Wolfson imposed the sentence today in Trenton federal court.

 

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

 

Spinapolice was a physician who operated Middlesex Healthcare Associates LLC, a medical office in Parlin. Spinapolice’s practice did not accept insurance and received payment primarily in cash. Spinapolice admitted that from January 2013 through July 2015, he deposited a total of $1,463,974 in cash proceeds via more than 198 separate transactions, all done in an amount of less than $10,000 in order to avoid currency reporting requirements.

 

In addition to the prison sentence, Judge Wolfson sentenced Spinapolice to a year of supervised release. Spinapolice also consented to the entry of a forfeiture money judgment in the amount of $1,463,974.

 

Acting U.S. Attorney Fitzpatrick credited special agents of IRS–Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen, and special agents with the FBI, under the direction of Special Agent in Charge Timothy Gallagher, with the investigation. He also thanked the Drug Enforcement Administration, the Monmouth County Prosecutor’s Office, the Middlesex County Prosecutor’s Office and the Borough of Sayreville Police Department for their assistance.

 

The government is represented by Senior Litigation Counsel R. Joseph Gribko of the U.S. Attorney’s Office Criminal Division in Trenton.

 

Defense counsel: Matthew S. Adams Esq., Roseland, New Jersey

NEWARK, N.J. – A Jersey City, New Jersey, man today admitted distributing heroin in Hoboken, New Jersey, on multiple occasions, Acting U.S. Attorney William E. Fitzpatrick announced.

Travis Thomas, a/k/a “Mush,” 27, pleaded guilty before U.S. District Judge Susan D. Wigenton in Newark federal court to an indictment charging him with one count of conspiracy to distribute heroin and seven substantive counts of heroin distribution.

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

Between July 2015 and December 2015, Thomas conspired with others to distribute heroin in Hudson County, including Hoboken. Thomas admitted that he distributed over 100 grams of heroin and worked with others, including Sterling McCoy, a/k/a “Boogs,” 33, of Pleasantville, New Jersey, and Jason Henderson Wheeler, a/k/a “J,” 28, of Hoboken, in furtherance of the conspiracy.

Thomas faces a sentence of between 10 years and life in prison. Sentencing is scheduled for Oct. 11, 2017. McCoy and Wheeler have already been convicted and sentenced for their roles in the conspiracy.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation.

The government is represented by Assistant U.S. Attorneys Brian Urbano and Erica Liu of the U.S. Attorney’s Office Criminal Division in Newark.

Defense Counsel: Jason N. Orlando Esq., Jersey City, New Jersey

CAMDEN, N.J. – Two Atlantic County, New Jersey, men were each given multi-year prison sentences for their participation in a nearly three-year conspiracy to distribute cocaine and crack cocaine in the Atlantic City, New Jersey area, Acting U.S. Attorney William E. Fitzpatrick announced today.

John Wellman, 41, of Atlantic City, New Jersey, was sentenced today to 130 months in prison. Ronald Douglas Byrd, 51, of Pleasantville, New Jersey, was sentenced July 11, 2017 to 96 months in prison. Both defendants previously pleaded guilty to Count One of an indictment charging them with conspiracy to distribute crack cocaine. U.S. District Judge Jerome B. Simandle imposed both sentences in Camden federal court.

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

From February 2012 through Dec. 10, 2014, Byrd, Wellman and others engaged in a drug trafficking conspiracy through which Byrd distributed more than one kilogram of crack cocaine and Wellman distributed more than 280 grams of crack cocaine. Members of the conspiracy used Byrd’s Pleasantville residence and at least two other residences in Pleasantville and Absecon, New Jersey – including one that was rented by Wellman – to store and package cocaine and crack cocaine.

In addition to the prison terms, Judge Simandle sentenced both defendants to five years of supervised release.

The U.S Attorney’s Office charged a total of 12 individuals for their participation in this drug trafficking conspiracy. All of those charged, with the exception of one defendant who remains a fugitive, have been convicted of their roles in the drug trafficking conspiracy or related charges.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI’s Newark Division, Atlantic City Resident Agency, under the direction of Special Agent in Charge Timothy Gallagher in Newark; the Drug Enforcement Administration’s Newark Division, under the direction of Special Agent in Charge Carl J. Kotowski; the Atlantic County Prosecutor’s Office, under the direction of Acting Prosecutor Diane M. Ruberton; and the Atlantic City Police Department, under the direction of Police Chief Henry White, with the investigation leading to these convictions.

He also thanked the N.J. State Police; the Bureau of Alcohol, Tobacco and Firearms; U.S. Immigration and Customs Enforcement (ICE)-Homeland Security Investigation (HSI); U.S. Postal Inspection Service; Cumberland County Sheriff’s Office and the Ventnor, Northfield and Millville police departments for their assistance.

The government is represented by Assistant U.S. Attorneys Diana Vondra Carrig and Howard Wiener of the U.S. Attorney’s Office Criminal Division in Camden.

Defense counsel:

Byrd: Michael Huff Esq., Philadelphia

Wellman: John F. Renner Esq., Marlton, New Jersey

NEWARK, N.J. – A former high-ranking employee of the Newark Watershed Conservation and Development Corp. (NWCDC) was sentenced today to 96 months in prison for accepting $956,948 in kickback payments for his and the former executive director’s assistance in awarding work to contractors, Acting U.S. Attorney William E. Fitzpatrick announced.

 

Donald Bernard Sr., 69, of West Orange, New Jersey, previously pleaded guilty before U.S. District Judge Jose Linares to Counts 9 and 10 of a 20-count indictment returned in December 2014, charging him with the use of interstate facilities to promote and facilitate bribery in violation of the Travel Act, and Count 1 of an information that charges him with making and subscribing a false personal tax return for the 2009 tax year. Judge Linares imposed the sentence today in Newark federal court.

 

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

 

Bernard served as a consultant to the NWCDC (from 2008 to January 2010) and then as a salaried employee (from January 2010 to March 2013). From 2008 to March 2013, Bernard was part of a corrupt arrangement with former NWCDC Executive Director Linda Watkins Brashear to solicit $956,948 in cash kickbacks from certain NWCDC contractors in exchange for providing them work and other assistance. Bernard and Brashear facilitated NWCDC payments to contractors to fund cash kickbacks to themselves, knowing payments were inflated above the amount of any work performed. They knew that in numerous instances no work at all had been performed. Bernard and Brashear used their email accounts to facilitate this scheme.

 

Two contractors from whom Bernard and Brashear obtained substantial cash kickbacks were Jim P. Enterprises and New Beginnings Environmental Services, both companies hired to perform landscaping, snow removal, clean-up and sign-posting services, which were affiliated with Bernard but purportedly operated by James Porter. Bernard admitted receiving $409,823 in bribes and kickbacks from Porter’s companies, funded by inflated and fraudulently obtained payments from the NWCDC, during the period January 2008 to December 2012. Bernard also admitted receiving approximately $85,000 from Essex Home Improvements, a contracting company operated by DeRosa, during the period January 2008 to March 2013, which he received either directly or indirectly through companies Bernard controlled.

 

Bernard also admitted filing a U.S. Individual Income Tax Return, Form 1040, for tax year 2009, which did not include approximately $314,000 in unreported income he received in kickbacks.

A co-defendant, Giacomo “Jack” DeRosa, 60, of Clinton Township, New Jersey, previously pleaded guilty to laundering a portion of $85,000 he provided to Bernard from January 2008 to August 2012 in connection with roofing work that Bernard facilitated for DeRosa with the NWCDC. DeRosa was sentenced on Oct. 25, 2016, to six months in prison.

Brashear pleaded guilty on Dec. 21, 2015, to devising a scheme to defraud the NWCDC as well as filing a false tax return by failing to report substantial income she received in connection with the kickback scheme. She is scheduled to be sentenced Sept. 11, 2017. Among the approximately $1 million in kickbacks that Brashear admitted receiving were approximately $260,000 from Porter and $27,000 from DeRosa. Porter pleaded guilty in January 2015 to conspiracy to defraud the NWCDC of honest services, money and property through the use of interstate wire transmissions, as well as tax evasion for his role in the kickback scheme. He is scheduled to be sentenced July 20, 2017.

 

DeRosa admitted that from January 2008 to August 2012 he provided Bernard with a stream of payments totaling approximately $85,000 for Bernard’s action and assistance in procuring NWCDC roofing work for DeRosa’s company. DeRosa provided these payments to Bernard either directly, or to Bernard’s consulting firm, or to a Newark-based civic organization run by Bernard, the African American Heritage Parade Committee. DeRosa also admitted to laundering $20,000 of the money by having it paid to Bernard indirectly through intermediaries in order to disguise DeRosa or Essex Home Improvements as the source of the funds. Two intermediaries DeRosa admitted to using to launder funds provided to Bernard included a subcontractor doing work for DeRosa’s company and Porter.

 

In addition to the prison term, Judge Linares sentenced Bernard to three years of supervised release.

 

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI’s Newark Field Office, under the direction of Special Agent in Charge Timothy Gallagher; IRS – Criminal Investigation, Newark Field Office, under the direction of Special Agent in Charge Jonathan D. Larsen; and the U.S. Department of Housing and Urban Development, Office of Inspector General, Newark office, under the direction of Special Agent in Charge Christina Scaringi, as well as criminal investigators of the U.S. Attorney’s Office, for the investigation leading to today’s guilty pleas. Acting U.S. Attorney Fitzpatrick also thanked the N.J. Office of the State Comptroller, under the direction of State Comptroller Philip James Degnan, for its assistance in the investigation.

 

The government is represented by Assistant U.S. Attorneys Jacques Pierre and Senior Litigation Counsel Leslie Schwartz of the U.S. Attorney’s Office Special Prosecutions Division.

 

NEWARK, N.J. – A former official of the Port Authority of New York and New Jersey was sentenced today to three years’ probation for using the authority’s resources to facilitate and conceal the cause of traffic problems in Fort Lee, New Jersey, to punish that borough’s mayor for not endorsing Gov. Chris Christie’s re-election.

 

David Wildstein, 55, the former director of Interstate Capital Projects at the Port Authority, pleaded guilty on May 1, 2015, before U.S. District Judge Susan D. Wigenton to an information charging him with two counts of conspiracy for his role in the scheme. Judge Wigenton imposed the sentence today in Newark federal court.

 

Wildstein, William E. Baroni Jr., 45, former deputy executive director of the Port Authority, and Bridget Anne Kelly, 44, former deputy chief of staff to Gov. Christie, engaged in a scheme to manufacture traffic problems in Fort Lee by reducing from three to one the number of local access lanes to the upper level of the George Washington Bridge. Baroni and Kelly were both convicted at trial for their respective roles in the scheme. On March 29, 2017, Judge Wigenton sentenced Baroni to 24 months in prison and Kelly to 19 months in prison.

 

“As we said in our motion to the Court, although David Wildstein was the architect of this criminal scheme and a force behind its cover-up, he accepted responsibility for his actions and admitted his guilt,” Acting U.S. Attorney William E. Fitzpatrick said. “His timely, complete and truthful cooperation was extraordinary and essential to the successful prosecution of Mr. Baroni and Ms. Kelly. The law requires the government and the court to take the nature and extent of Mr. Wildstein’s cooperation into account in fashioning an appropriate sentence.”

 

“This investigation has conclusively established that the conspirators, William Baroni, Bridget Anne Kelly, and David Wildstein misused their government positions to harm the very members of the public they were hired to serve,” Inspector General Michael Nestor of the Port Authority, Office of Inspector General, said. “By doing so, they put the interests of a few before the greater good of the public. They engaged in a cover-up of their scheme, and caused false information to be distributed to Port Authority employees, other government officials, and the public. The Port Authority Office of Inspector General and its professional staff continue to fulfill its mission of rooting out corruption, at no matter what level it may exist within the Port Authority. We commend and thank our law enforcement partners for their cooperative effort and tireless work.”

 

“Combating public corruption is one of the FBI’s top criminal investigative priorities. It strikes not only at the heart of good government, but it also jeopardizes the security of our communities and our nation,” FBI Special Agent in Charge Timothy Gallagher, Newark Division, said. “Public corruption erodes public confidence and diminishes the strength of our democracy. Today’s sentencing highlights our commitment to aggressively pursue those who engage in unethical and corrupt practices.”

 

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

 

In August 2013, after Kelly confirmed that Fort Lee Mayor Mark Sokolich would not be endorsing Gov. Christie for re-election in November 2013, Baroni, Kelly, and Wildstein decided to punish the mayor by deliberately causing significant traffic problems in Fort Lee under the false pretense of a traffic study.

 

From the morning of Sept. 9, 2013, to Sept. 13, 2013, the conspirators caused the local access lanes to be reduced so that only one toll booth, instead of the usual three, was accessible to the approach to the bridge for local traffic traveling through Fort Lee. To maximize the congestion and the punitive impact on Mayor Sokolich, the conspirators caused these lane and toll booth reductions to start on the first day of the school year without any advance notice to Mayor Sokolich, the Fort Lee chief of police or borough residents. The lane and toll booth reductions resulted in significant traffic in Fort Lee, for motorists intending to access the George Washington Bridge from local lanes, and for residents, whose streets were choked with traffic.

 

The conspirators agreed to disregard any inquiries from Mayor Sokolich and other Fort Lee officials about the lane and toll booth reductions. They purposely ignored communications from Mayor Sokolich, including his pleas for help, requests for information, and repeated warnings about the increased risks to public safety.

 

The conspirators concocted and promoted a sham story that the lane reductions were for a traffic study. They created and advanced this cover story so they could use Port Authority property, including the time and services of unwitting Port Authority personnel and other resources, to implement the lane and toll booth reductions and conceal their true punitive purpose.

 

In addition to probation, Judge Wigenton sentenced Wildstein to 500 hours of community service, ordered restitution of $14,314 and fined him $10,000.

 

U.S. Attorney Fitzpatrick credited criminal investigators of the Port Authority, Office of Inspector General, under the direction of Inspector General Nestor; special agents of the FBI, under the direction of Special Agent in Charge Gallagher; and criminal investigators of the U.S. Attorney’s Office, for the investigation leading to today’s sentencing.

 

The government is represented by Assistant U.S. Attorneys Lee M. Cortes Jr., Vikas Khanna, David W. Feder and Senior Litigation Counsel J Fortier Imbert of the U.S. Attorney’s Office Special Prosecutions Division.

NEWARK, N.J. – A brother and sister from New Jersey have been charged with running a multi-million-dollar fraudulent invoice scheme, Acting U.S. Attorney William E. Fitzpatrick announced today.

Shevandra Verasawmi, 37, of Matawan, New Jersey, and Vishallie Verasawmi, 36, of Green Brook, New Jersey, are charged by indictment with one count of conspiracy to commit mail fraud and three counts of mail fraud.

Shevandra Verasawmi was arrested July 11, 2017, and appeared that afternoon before U.S. Magistrate Judge David Cayer in Charlotte, North Carolina, federal court. Vishallie Verasawmi was arrested this morning and appeared this afternoon before U.S. Magistrate Judge Joseph A. Dickson in Newark federal court. Both defendants, who are out on bail, will be arraigned before U.S. District Judge Freda L. Wolfson in Trenton federal court on July 19, 2017.

According to the indictment:

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 add the shell companies 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 luxury cars and credit card payments.

The indictment seeks forfeiture of Shevandra and Vishallie Verasawmi’ s alleged proceeds from the scheme, including $1,066,829.57 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.

The investigation was led by criminal investigators with the U.S. Attorney’s Office in Newark. The government is represented by Assistant U.S. Attorneys Daniel Shapiro of the U.S. Attorney’s Office Economic Crimes Unit and Alex Weinberg of the office’s Asset Forfeiture and Money Laundering Unit.

Acting U.S. Attorney Fitzpatrick thanked postal inspectors from the U.S. Postal Inspection Service, under the direction of Inspector in Charge James V. Buthorn, and the U.S. Marshals for their assistance.

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

This case is part of efforts underway by the Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov

NEWARK, N.J. – A member of the New Jersey set of the Grape Street Crips today admitted his role in a racketeering conspiracy that involved using other gang members to intimidate a witness during a state criminal trial, as well as conspiracies to distribute heroin and crack-cocaine, Acting U.S. Attorney William E. Fitzpatrick announced.

Ahmed Singleton, a/k/a “Gangsta-Moo,” a/k/a “Gangsta,” a/k/a “Mooshie,” 28, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to three counts in the sixth superseding indictment charging him with RICO conspiracy and separate conspiracies to distribute one kilogram of heroin and 280 grams or more of crack-cocaine.

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

As part of the racketeering conspiracy, Singleton admitted that he used fellow members of the N.J. Grape Street Crips to intimidate a witness against him by having those gang members sitting in the gallery of the courtroom as the witness took the stand. Singleton was facing criminal charges brought by the Essex County Prosecutor’s Office for aggravated assault, possession of a weapon for an unlawful purpose, and unlawful possession of a firearm for a shooting that occurred in April 2013. As a result of Singleton’s effort, the witness refused to testify against him and the charges were dismissed.

Afterwards, Singleton was intercepted over a wiretap bragging to a fellow gang-member: “Who you know cause a ruckus on these motherfuckin streets, come home, do whatever the fuck they want, and still be out here son?”

Singleton also admitted to participating in conspiracies to distribute one kilogram or more of heroin and 280 grams or more of crack-cocaine.

The N.J. Grape Street Crips controlled drug trafficking and other criminal activities in various areas of Newark, including the area of 6th Avenue and North 5th Street and public-housing complexes at Pennington Court, Oscar Miles, the Millard Terrell Homes, the John W. Hyatt homes and the former James Baxter Terrace complex.

Under the terms of the plea agreement, Singleton will receive a sentence of 19 years in prison and five years of supervised release. Sentencing is scheduled for Oct. 12, 2017.

Acting U.S. Attorney Fitzpatrick credited special agents of the Drug Enforcement Administration (DEA), under the direction of Special Agent in Charge Carl J. Kotowski, and special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher, with the investigation. Acting U.S. Attorney Fitzpatrick also thanked prosecutors and detectives of the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Robert D. Laurino, police officers and detectives of the Newark Department of Public Safety, under the direction of Director Anthony F. Ambrose, and the Essex County Sheriff’s Office, under the direction of Armando B. Fontoura, for their work on the investigation.

The government is represented by Assistant U.S. Attorneys Osmar J. Benvenuto and Barry Kamar of the Office’s Criminal Division in Newark.

This case was conducted under the auspices of the Organized Crime Drug Enforcement Task Force (OCDETF) and the FBI’s Safe Streets Task Force, a partnership between federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations and those primarily responsible for the nation’s illegal drug supply.

Defense Counsel: Alyssa Cimino Esq., Fairfield, New Jersey

 

NEWARK, N.J. – A Newark man was sentenced today to 240 months in prison for his involvement in an August 2015 home invasion that left one person dead, Acting U.S. Attorney William E. Fitzpatrick announced.

Jahad Lemons, a/k/a “JBird,” 26, previously pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to an indictment charging him with one count of murder during a crime of violence, one count of Hobbs Act robbery conspiracy, one count of Hobbs Act robbery, and one count of using a firearm during a crime of violence. Judge Arleo imposed the sentence today in Newark federal court.

According to the indictment:

On Aug. 18, 2015, Lemons, his co-defendants, Aaron Terrell, a/k/a “Push,” 26, and Papayaw Mack, a/k/a “GY,” 26, and two other individuals – referred to in the indictment as “CC-1” and “CC-2” – allegedly used firearms to rob the apartment of an individual referred to in the indictment as “Victim-1” at a residential building in Newark. They targeted Victim-1 because they believed Victim-1was a heroin trafficker whose residence contained narcotics and related proceeds.

Lemons, Terrell, Mack, CC-1, and CC-2 allegedly surrounded Victim-1, forced him into his apartment, and then proceeded to rob at gunpoint Victim-1 – as well as Victim-2 and Victim-3, who were already inside the apartment – of cash and personal effects. Terrell and CC-2 allegedly discharged their firearms, which killed Victim-1 and seriously wounded Victim-2.

All three men were originally charged by the Essex County Prosecutor’s Office with murder and robbery. On Aug. 26, 2015, Terrell was arrested by the Newark Police Department, while Lemons was arrested in Georgia on Oct. 26, 2015. Mack remains at large. Terrell is also facing separate federal charges in a sixth superseding indictment for his participation in a racketeering conspiracy related to the New Jersey set of the Grape Street Crips, a violent street gang operating in Newark.

In addition to the prison term, Judge Arleo sentenced Lemons to five years of supervised release.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation leading to the charges. He also thanked prosecutors and detectives of the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Robert D. Laurino, and police officers and detectives of the Newark Department of Public Safety, under the direction of Director Anthony F. Ambrose, for their assistance.

The government is represented by Assistant U.S. Attorneys Osmar J. Benvenuto and Barry A. Kamar of the Criminal Division in Newark.

This case was conducted under the auspices of the Organized Crime Drug Enforcement Task Force (OCDETF) and the FBI’s Safe Streets Task Force, a partnership between federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.

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

NEWARK, N.J. – Four members of a scheme that used secret card-reading devices and pinhole cameras on PNC and Bank of America ATMs to steal at least $428,581 pleaded guilty today in Newark federal court.

Acting U.S. Attorney William E. Fitzpatrick of the District of New Jersey; Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division; and Acting Special Agent in Charge Brian A. Michael of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations Newark Division made the announcement.

Marcel Peckham, 43, of Little Neck, New York; Catalin Mihai Dragomir, 33, of Glendale, New York; Eduard Vasilica Ticu, 32, of Glendale; and Silvester Florentin Papp, 25, of Ridgewood, New York, pleaded guilty before U.S. District Judge Esther Salas to separate informations charging them each with one count of conspiracy to commit bank fraud.

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

Peckham, Dragomir, Ticu, Papp, and others sought to defraud financial institutions and their customers by illegally obtaining customer account information, including account numbers and personal identification numbers. Peckham admitted providing counterfeit ATM cards to other conspirators, knowing that they were going to use them to withdraw cash from compromised bank accounts at ATMs in New Jersey. Dragomir, Ticu, and Papp each admitted that between March 2015 and July 2016, they made unauthorized cash withdrawals using the counterfeit ATM cards.

The conspiracy to commit bank fraud charge carries a maximum potential penalty of 30 years in prison and a $1 million fine. Sentencing for all four defendents is set for Oct. 23, 2017.

Joel Abel Garcia, Victor A. Hanganu, and Radu Bogdan Marin also pleaded guilty to their roles in the scheme and await sentencing. To date, seven of the 13 defendants charged in this matter have been convicted.

The U.S. Immigration and Customs Enforcement’s Homeland Security Investigation’s Newark, New Jersey, Division; U.S. Secret Service’s Boston Field Office; Longmeadow, Massachusetts, Police Department; Cambridge, Massachusetts, Police Department; and Medford, Massachusetts, Police Department investigated the case with assistance from Bank of America Security and Fraud Section and PNC Bank Security Division. The Middlesex County, Massachusetts, District Attorney’s Office; U.S. Attorney’s Office of the Eastern District of New York and U.S. Attorney’s Office of the District of Massachusetts Springfield Division assisted in the investigation and prosecution.

The government is represented by Assistant U.S. Attorney Kelly Graves of the U.S. Attorney’s Office Criminal Division in Newark and Trial Attorney Marianne Shelvey of the Justice Department’s Criminal Division Organized Crime and Gang Section.

Defense counsel:

Peckham: Howard B. Brownstein Esq., Union City, New Jersey

Dragomir: Timothy Michael Donohue Esq., West Orange, New Jersey

Ticu: Tejinder Bains Esq., Forest Hills, New York

Papp: Stacy A. Biancamano Esq., Cranford, New Jersey

NEWARK, N.J. – A Bergen County, New Jersey, man was sentenced today to 162 months in prison for purchasing more than three kilograms of heroin from a source in Bronx, New York, and re-selling it to drug dealers in Paterson, New Jersey, Acting U.S. Attorney William E. Fitzpatrick announced.

Edwin Lopez, a/k/a “E,” a/k/a “Pan,” 31, of Elmwood Park, New Jersey, pleaded guilty before U.S. District Judge Susan D. Wigenton in Newark federal court to information charging him with one count of conspiracy to possess with intent to distribute more than one kilogram of heroin.

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

From June 2015 to May 2016, Lopez and others allegedly participated in a drug trafficking organization that amassed wholesale quantities of heroin at multiple locations around Bronx and used couriers to deliver large quantities of heroin to mid-level drug dealers in Paterson. The heroin was either sold in the Paterson area or redistributed to street-level drug dealers in suburban areas, including Morris County, New Jersey, and Rockland County, New York.

Lopez admitted he participated in this conspiracy from June 2015 until his arrest on April 19, 2016. He admitted that at the time of his arrest, he was giving a $13,500 payment to one of Goris-Castellano’s couriers in exchange for the 150 bricks of heroin.

In addition to the prison term, Judge Wigenton sentenced Lopez to five years of supervised release.

Acting U.S. Attorney Fitzpatrick credited special agents of the Drug Enforcement Administration’s New Jersey Division, under the direction of Special Agent in Charge Carl J. Kotowski in Newark, with the investigation leading to today’s sentencing.

The government is represented by Assistant U.S. Attorney Sara F. Merin of the OCDETF/Narcotics Unit of the U.S. Attorney’s Office in Newark.

This case was brought under the auspices of the Organized Crime Drug Enforcement Task Force (OCDETF), a partnership between federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.

NEWARK, N.J. – A Springfield, New Jersey, man who was previously convicted of possessing child pornography was arrested this morning on the same charge, Acting U.S. Attorney William E. Fitzpatrick announced.

Sam Cynamon, 66, is charged by criminal complaint with one count of possession of child pornography. He appeared this afternoon before U.S. Magistrate Judge Leda Dunn Wettre in Newark federal court was released on $100,000 unsecured bond.

According to the complaint:

On Jan. 10, 2017, Cynamon used an Internet based peer-to-peer network to request a webcam video file of a prepubescent girl engaging in sexually explicit conduct. On July 10, 2017, law enforcement obtained multiple computers and electronic storage media belonging to Cynamon from his residence. The computers and electronic storage media contained the peer-to-peer network software and multiple images and videos of child pornography, including images of child sexual abuse.

Cynamon previously pleaded guilty in New Jersey federal court to possession of child pornography in March 2005 and was sentenced to 27 months in prison.

As a result of Cynamon’s prior conviction, the charge of possession of child pornography 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.

Acting U.S. Attorney Fitzpatrick credited special agents with the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), under the direction of Acting Special Agent in Charge Brian A. Michael, with the investigation.

The government is represented by Assistant U.S. Attorney Danielle Alfonzo Walsman of the U.S. Attorney’s Office Criminal Division in Newark.

Defense counsel: Alan Zegas Esq., Chatham, New Jersey

TRENTON, N.J. – A senior member of a large-scale drug trafficking organization today admitted distributing heroin in Ocean and Monmouth Counties and elsewhere in New Jersey, Acting U.S. Attorney William E. Fitzpatrick announced.

Robert Britt, a/k/a “True,” 45, of Asbury Park, New Jersey, pleaded guilty before U.S. District Judge Peter G. Sheridan in Trenton federal court to an indictment charging him with conspiracy to distribute heroin.

Between March and May 2014, 21 other individuals, including numerous members of the drug trafficking organization, were charged in two separate criminal complaints with conspiring to distribute heroin and other related offenses. The complaint referred to the drug trafficking organization as the “Britt-Young DTO,” after two of its leading members, Britt and Rufus Young, a/k/a “Equan,” a/k/a “E-Money,” a/k/a “Kintock.” As of today’s plea, all 22 defendants have been convicted.

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

Between July 2010 and March 2014, Britt conspired with others to distribute heroin in Ocean and Monmouth counties as part of the Britt-Young DTO. During his plea hearing, Britt admitted that he distributed between one and three kilograms of heroin in furtherance of the conspiracy and that he served as a manager or supervisor of the conspiracy.

Under the terms of the plea agreement, if accepted by the court, Britt will receive a sentence of 12 years in prison. Sentencing is scheduled for Nov. 2, 2017.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI Red Bank Resident Office, under the direction of Special Agent in Charge Timothy Gallagher, with the investigation.

The government is represented by Assistant U.S. Attorneys Nicholas Grippo and Brendan Day of the U.S. Attorney’s Office Criminal Division in Trenton.

NEWARK, N.J. – A New York man today admitted robbing a bank in Fort Lee, New Jersey, in January 2017, Acting U.S. Attorney William E. Fitzpatrick announced.

Issac Nesbit, 30, pleaded guilty before U.S. District Judge Esther Salas in Newark federal court to an information charging him with one count of bank robbery.

According to the documents filed in this case and statements made in court, Nesbit admitted that Jan. 20, 2017, he robbed a Bank of New Jersey in Fort Lee. Nesbit admitted that he handed a teller a hand-written note demanding cash and threatening to shoot everyone in the bank if the teller did not comply. 

The bank robbery charge carries a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Sentencing is scheduled for Oct. 17, 2017.

Acting U.S. Attorney Fitzpatrick credited special agents with the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark; the Bergen County Prosecutor’s Office, under the direction of Prosecutor Gurbir S. Grewal; and the Fort Lee Police Department, under the direction of Chief Keith M. Bendul, with the investigation leading to the conviction.

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

Defense counsel: Patrick McMahon Esq., Assistant Federal Public Defender, Newark

CAMDEN, N.J. – A Burlington County, New Jersey, man has been sentenced to 54 months in prison for his role in a mortgage fraud scheme that caused $2.7 million in losses, Acting U.S. Attorney William E. Fitzpatrick announced today.

Pierre Chainey, 42, of Tabernacle, New Jersey, previously pleaded guilty before U.S. District Judge Noel L. Hillman to one count of conspiracy to commit wire fraud and one count of money laundering. Judge Hillman imposed the sentence on July 7, 2017, in Camden federal court.

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

In November 2005, Chainey established Universal Lending Solutions LLC, a mortgage brokerage company in Northfield, New Jersey, and served as chief executive office of the company until 2008. He was also a loan officer for the company.

From November 2005 through at least January 2008, he conspired with others to profit from the sale and purchase of properties in New Jersey by obtaining mortgage loans for unqualified borrowers using fraudulent loan applications, HUD-1 Settlement Statements and other documents.

In addition to the prison term, Judge Hillman sentenced Chainey to three years of supervised release; restitution will be determined at a later date.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher, and special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen with the investigation leading to today’s sentencing.

The government is represented by Senior Litigation Counsel Jason M. Richardson of the U.S. Attorney’s Office Criminal Division in Newark.

NEWARK, N.J. – The U.S. Court of Appeals for the Third Circuit today affirmed the convictions of three Orthodox rabbis who were convicted at trial of conspiring to kidnap Orthodox Jewish husbands who refused to grant their wives permission to divorce, Acting U.S. Attorney William E. Fitzpatrick announced.

In a precedential opinion in the consolidated appeals of Orthodox rabbis Binyamin Stimler, Jay Goldstein, and Mendel Epstein, the appeals court affirmed the convictions in all respects.

The goal of the conspiracy was to coerce the recalcitrant husbands to grant a “get” – permission to obtain a religious divorce – to their wives. On appeal, the defendants raised numerous claims, including a constitutional challenge to a federal statute and a claim that the prosecution violated the Religious Freedom Restoration Act.

The government was represented by Assistant U.S. Attorneys Norman Gross and Glenn J. Moramarco of the U.S. Attorney’s Office Appeals Division in Camden.

Stimler, Goldstein & Epstein Verdict Release

Stimler & Epstein Sentencing Release

Goldstein Sentencing Release

 

NEWARK, N.J. – A Paterson, New Jersey, man appeared in federal court today to face charges that he recently robbed a TD Bank in Paterson, New Jersey, and an Investors Bank in Clifton, New Jersey, Acting U.S. Attorney William E. Fitzpatrick announced.

James M. Chestnut, 62, was arrested yesterday and charged by complaint with two counts of bank robbery. He appeared this afternoon before U.S. Magistrate Judge Mark Falk in Newark federal court and was detained.

According to the complaint:

On June 30, 2017, Chestnut allegedly entered a TD Bank in Paterson and handed a teller a note stating “Put 100s and 50s in the envelope. No dye pack.”

On July 5, 2017, Chestnut allegedly entered an Investors Bank in Clifton and approached a teller, this time while brandishing a firearm. He told the teller to “Open your drawer. Give me your money. All the 100s. Don’t call the cops or I’ll shoot you.”

Chestnut has two prior federal bank robbery convictions from 1996 and 2004.

The armed bank robbery count carries a maximum potential penalty of 25 years in prison. The unarmed bank robbery count carries a maximum potential penalty of 20 years in prison. Both counts carry a $250,000 fine, or twice the gross gain or loss from the offense.

Acting U.S. Attorney Fitzpatrick credited special agents with the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, New Jersey, with the investigation. He also thanked the Paterson Police Department, under the direction of Director Jerry Speziale; the Saddle Brook Police Department, under the direction of Chief Robert Kugler; the Clifton Police Department, under the direction of Chief Mark Centurione; and the Passaic Police Department, under the direction of Chief Luis A. Guzman, for their assistance.

In addition, the investigation was aided by the FBI Violent Crime Task Force, which is comprised of law enforcement personnel from the Bergen County Prosecutor’s Office, the Passaic County Prosecutor’s Office, the Roxbury Police Department, the Paterson Police Department, and the N.J. State Police.

The government is represented by Assistant U.S. Attorney Elaine K. Lou of the U.S. Attorney’s Office Criminal Division in Newark.

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

Defense counsel: Patrick McMahon Esq., Assistant Federal Public Defender, Newark

TRENTON, N.J. – A Trenton man was sentenced today to 72 months in prison for his role in a drug trafficking organization that allegedly distributed hundreds of grams of heroin in Trenton and the surrounding areas, Acting U.S. Attorney William E. Fitzpatrick announced today.

 

Keith Hunter, a/k/a “Meech,” 24, previously pleaded guilty before U.S. District Judge Freda L. Wolfson in Trenton federal court to an information charging him with conspiracy to distribute and possess with intent to distribute 100 grams or more of heroin. As part of his guilty plea, Hunter also admitted possessing at least one firearm during the conspiracy.

 

In December 2016, Hunter and nine other members of a drug trafficking organization operating in Trenton were charged by criminal complaint with conspiracy to distribute heroin. The complaint referred to the drug trafficking organization as the “Abdullah DTO,” after its alleged leader, Ishmael Abdullah.

 

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

 

From June 2015 through December 2016, Hunter and others engaged in a drug trafficking organization that operated in the area of Spring and Passaic streets in Trenton. Through the authorized interception of telephone calls and text messages, controlled purchases of heroin, the use of confidential sources of information, and other investigative means, law enforcement learned that defendant Ishmael Abdullah was a leader of the Abdullah DTO and was responsible for obtaining significant quantities of heroin from multiple suppliers, including from defendants Jose Joaquin Torres-Mezquita and Ileana Sanchez. Abdullah and Hunter coordinated the organization’s distribution of heroin through themselves and other conspirators. Members of the Abdullah DTO used temporary prepaid phones, stash houses and cars, and spoke in code to avoid detection by law enforcement. In connection with their narcotics conspiracy, Hunter and other members of the Abdullah DTO maintained joint access to multiple firearms.

 

In addition to the prison term, Judge Wolfson sentenced Hunter to four years of supervised release.

 

Acting U.S. Attorney Fitzpatrick credited agents and officers with the Greater Trenton Safe Streets Task Force, including special agents of the FBI, Newark Division, Trenton Resident Agency, under the direction of Special Agent in Charge Timothy Gallagher; special agents of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), Newark Division, Trenton Satellite Office, under the direction of Acting Special Agent in Charge Lawrence J. Panetta; officers of the Trenton Police Department, under the direction of Director Ernest Parrey Jr.; officers of the Princeton Police Department, under the direction of Chief of Police Nicholas Sutter; officers of the Ewing Police Department, under the direction of Chief of Police John P. Stemler III; and detectives of the Mercer County Prosecutor’s Office, under the direction of Mercer County Prosecutor Angelo J. Onofri, with the investigation.

 

He also thanked special agents of the FBI’s Philadelphia Field Office, under the direction of Special Agent in Charge Michael Harpster; special agents of Homeland Security Investigations, under the direction of Special Agent in Charge Terence S. Opiola; officers of the New Jersey State Police, under the direction of Superintendent Col. Joseph R. Fuentes; and officers of the Mercer County Sheriff’s Office, under the direction of Sheriff John A. Kemler, for their assistance in the case.

 

The government is represented by Assistant U.S. Attorney J. Brendan Day of the U.S. Attorney’s Office’s Criminal Division in Trenton.

 

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

 

Defense counsel: Robert J. Haney Esq., Princeton, New Jersey

NEWARK, N.J. – Two Rockland County, New York, men were sentenced to prison today for their roles in the December 2015 robbery of a North Jersey bar and the violent carjacking and kidnapping that took place shortly afterwards, Acting U.S. Attorney William E. Fitzpatrick announced.

Guillermo Carrillo-Iraheta, 20, and Juan Chiliseo-Vega, 20, both of Suffern, New York, were sentenced to 150 and 168 months in prison, respectively. Both defendants previously pleaded guilty to separate informations charging them with conspiracy to commit Hobbs Act Robbery, carjacking, and kidnapping. U.S. District Judge Jose L. Linares imposed the sentences today in Newark federal court.

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

On Dec. 25, 2015, Guillermo Carrillo-Iraheta, Chiliseo-Vega and others robbed a bar in Hawthorne, New Jersey, and subsequently fled with approximately $200 in cash.

Afterwards, in the early morning hours of Dec. 26, 2015, Guillermo Carrillo-Iraheta, Chiliseo-Vega, and others hailed a taxi in Paterson, New Jersey, and forcibly took the taxi from the driver. Guillermo Carrillo-Iraheta, Chiliseo-Vega and others forced the driver into the back of the vehicle and took over driving. They also 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 terms, Judge Linares sentenced both defendants to five years of supervised release.

Wilbur Jonathan Barahona, 21, of Ridgewood, New Jersey, and Jostin Reyes, 21, of Waldwick, New Jersey, have also pleaded guilty to their roles in the bar robbery, carjacking and kidnapping. Balmore Carrillo-Iraheta, 20, of Suffern, and Oscar Avalos-Cortez, 23, of New City, New York, pleaded guilty to their roles in the bar robbery. All four defendants await sentencing.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, investigators from the Bergen County Prosecutor’s Office, under the direction of Prosecutor Gurbir S. Grewal, and the Ridgewood and Hawthorne Police Departments with the investigation.

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.

Defense counsel:

Guillermo Carrillo-Iraheta: Michele Ann Adubato Esq., Bayonne, New Jersey.

Chiliseo-Vega: Frank Arleo Esq., West Orange, New Jersey

Defendants Will Be Resentenced at a Later Date

 

NEWARK, N.J. – The U.S. Court of Appeals for the Third Circuit today ruled that a former U.S. Army major and his wife, convicted for having endangered the welfare of their adopted children through a series of physically abusive acts, must be resentenced, Acting U.S. Attorney William E. Fitzpatrick announced.

 

Convicted by a jury in July 2015 on multiple counts of child endangerment, Carolyn Jackson, 39, had received only 24 months in prison while her husband, John E. Jackson, 42, formerly a major in the Army at the Picatinny Arsenal Installation in Morris County, New Jersey, had received only probation and 400 hours of community service. The government had appealed their sentences to the U.S. Court of Appeals for the Third Circuit.

 

Today, the Court of Appeals ruled that the District Court had committed several errors in the process of imposing those sentences. As a result, the Jacksons will be resentenced at a later date, which has yet to be decided.

 

The government was represented by Assistant U.S. Attorney John Romano of the U.S. Attorney’s Office Appeals Division in Newark.

 

Jackson Verdict Release

 

Jackson Sentencing Release

 

NEWARK, N.J. – A hospice company in Bensalem, Pennsylvania, has agreed to pay to the United States $2 million to resolve allegations that it provided unnecessary hospice services, Acting U.S. Attorney William E. Fitzpatrick announced today.

 

Compassionate Care of Gwynedd Inc. is a hospice provider based in Bensalem and a subsidiary of Compassionate Care Hospice Group Inc., a Florida corporation with its principal place of business in Parsippany, New Jersey. The settlement announced today follows an investigation by the U.S. Attorney’s Office for the District of New Jersey and the Commercial Litigation Branch of the Justice Department’s Civil Division. The allegations arose from a whistle-blower suit filed under the False Claims Act.

 

The United States alleges that from Jan. 1, 2005, through Nov. 15, 2011, Compassionate Care of Gwynedd admitted patients who did not need hospice care and billed Medicare for these medically unnecessary services. The government alleges that the company admitted these patients by using a diagnosis of “debility” that was not medically justified.

 

The relators, or whistler-blowers, in the underlying qui tam will receive more than $350,000 as their statutory share of the recovery under the False Claims Act. The civil lawsuit was filed in the District of New Jersey and is captioned United States, et al., ex rel. Jane Doe and Mary Roe v. Compassionate Care Hospice, et al.

 

Acting U.S. Attorney Fitzpatrick credited 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 leading to the settlement.

 

The government is represented by Assistant U.S. Attorney Charles Graybow of the Health Care and Government Fraud Unit of the U.S. Attorney’s Office for the District of New Jersey and Trial Attorney Justin Draycott of the Department of Justice’s Civil Division. The Office of Inspector General and the Office of the General Counsel for the Centers for Medicare and Medicaid Services of the Department of Health and Human Services also participated in the investigation and settlement.

 

The U.S. Attorney’s Office for the District of New Jersey reorganized its health care practice in 2010 and created a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since that time, the office has recovered more than $1.36 billion in health care and government fraud settlements, judgments, fines, restitution and forfeiture under the False Claims Act, the Food, Drug and Cosmetic Act, and other statutes.

 

The claims settled by this agreement are allegations only; there have been no admissions of liability.

 

Counsel for relators: Britton D. Monts Esq., Austin, Texas; Timothy J. McInnis Esq., New York

Counsel for defendant: Sean C. Cenawood Esq., New York

CAMDEN, N.J. – An Atlantic City, New Jersey, man appeared in federal court today to face charges that he received images of child sexual abuse, Acting U.S. Attorney William E. Fitzpatrick announced.

Keith M. Clack, 41, is charged by complaint with knowingly receiving images of child pornography. Clack appeared this morning before U.S. Magistrate Judge Karen M. Williams in Camden federal court and was detained.

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

In May 2017, law enforcement officers conducted an undercover operation in which electronic devices later identified as belonging to Clack were detected accessing and downloading more than 3,500 images of child pornography, including images of infants and toddlers being sexually abused, and child erotica.  

Because Clack has a prior conviction for sexual assault on a minor and endangering the welfare of a minor, if convicted of the charge in the complaint, he faces a 15-year mandatory minimum term of imprisonment and a maximum potential sentence of 40 years in prison (increased from the ordinary five-year mandatory minimum and 20-year maximum terms).  Clack also faces additional penalties upon conviction, including the greater of a $250,000 fine, or twice the gross gain or loss from the offense, and a term of supervised release of at least five years and up to life.

Acting U.S. Attorney Fitzpatrick credited special agents with the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark; the Atlantic City Police Department, under the direction of Chief Henry White; the Atlantic City Sheriff’s Department, under the direction of Frank Balles; the New Jersey Human Services Police, under the direction of Director Timothy Gallagher; and the Atlantic County Prosecutor’s Office, under the direction of Prosecutor Damon Tyner, with the investigation.

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

Defense Counsel: Thomas Young Esq., Assistant Federal Public Defender, Camden

PHILADELPHIA – Philadelphia District Attorney Rufus Seth Williams today admitted that he accepted tens of thousands of dollars’ worth of concealed bribes in exchange for his agreement to perform official acts, defrauded a nursing home and family friends of money earmarked for a family member’s care, and used political action committee funds and official government vehicles for his personal benefit, Acting New Jersey U.S. Attorney William E. Fitzpatrick announced.

Williams, 50, of Philadelphia, pleaded guilty before U.S. District Judge Paul S. Diamond to Count One of a superseding indictment charging him with travel and use of interstate facilities to promote and facilitate bribery contrary to Pennsylvania law. Williams was ordered detained until his sentencing, which is set for Oct. 24, 2017.

“The indictment alleged that, as District Attorney, Mr. Williams compromised himself and his elected office by using his office to help those willing to secretly pay him with valuable items like money, trips, and cars, as well as defrauding his political action committee and others,” Acting U.S. Attorney Fitzpatrick said. “Today, Mr. Williams admitted all of that conduct. He admitted that he misused the resources of the Philadelphia DA’s Office and his influence as an elected official for personal gain. He admitted defrauding his political action committee. He admitted defrauding his mother’s nursing home and her friends. Williams owed the public a duty to act according to the highest legal and ethical standards. Seth Williams breached that trust; he abused his power; and he will now be held accountable for his actions.”

“From his first day in office, Seth Williams sought to portray himself as a man of the people – a principled public servant and reformer, devoted to the cause of justice,” said Michael Harpster, Special Agent in Charge of the FBI’s Philadelphia Division. “Mr. Williams talked a good game. Unfortunately, ‘talk’ is all it was. In reality, he gamed the system. Feeling entitled to a certain lifestyle, he traded on his title of District Attorney in exchange for financial favors large and small. We’re gratified that Mr. Williams elected to change his plea, and admit to such brazen misconduct.”

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

From July 2010 through May 2015, Williams had an arrangement with Mohammad N. Ali (identified in the indictment as “Business Owner #1) in which Williams, while serving as the Philadelphia District Attorney, accepted trips, money, and other things of value in exchange for performing and agreeing to perform official acts on behalf of Ali, including contacting a Philadelphia police official in order to pressure and advise the official to assist Ali with security screenings at the airport. Williams also agreed to assist with criminal charges brought by the Philadelphia District Attorney’s Office against Ali’s associate.

From March 2012 through July 2015, Williams had an arrangement with Michael Weiss (identified in the superseding indictment as “Business Owner #2”) in which Williams accepted airline tickets, money, an automobile, and other things of value in exchange for performing and agreeing to perform official acts on behalf of Weiss, including appointing him as Special Advisor to the Philadelphia District Attorney’s office in November 2012 and providing an official letter to the California Department of Alcoholic Beverage Control in order to influence a then-pending hearing to revoke or suspend Weiss’ California liquor license. In July 2015, Williams also obtained a police accident report at Weiss’ request.

In addition, from February 2012 through November 2013, Williams diverted his mother’s pension and Social Security payments to pay for his own personal expenses instead of applying them to his mother’s nursing home costs, as was his obligation under agreements with the nursing home. After accepting $10,000 from his mother’s friends intended to cover expenses for her nursing home care, Williams spent that money on his personal expenses as well.

From August 2010 through August 2016, Williams also defrauded the “The Committee to Elect Seth Williams” by using its funds for personal expenditures, including parties, birthday dinners, massages, and fitness classes. He concealed this fraud by providing false or incomplete reports to the Commonwealth of Pennsylvania and to the City of Philadelphia.

Lastly, Williams engaged in a scheme to use official vehicles – which were provided by the City of Philadelphia and a federal narcotics law enforcement program – for his personal benefit. Williams used the vehicles to transport himself, family members, friends and other non-employees on non-district attorney business, including personal trips outside of Philadelphia.

“The gifts Williams received represents the degree to which he was cheating the public," said IRS-CI Acting Special Agent in Charge Gregory Floyd. “No public official gets a free pass to ignore our laws. IRS CI will continue to ensure that our elected officials abide by their oath to faithfully discharge the duties of their office. It is unacceptable to accept benefits in exchange for performing official acts, but if you do IRS-Criminal Investigation will be there to seek justice on behalf of the citizens of Philadelphia."

“Homeland Security Investigations is pleased to have contributed to this investigation to hold accountable a public official who betrayed the trust of his community by engaging in such unscrupulous behavior,” Marlon V. Miller, special agent in charge of HSI Philadelphia, said. “The public places an enormous amount of trust in elected officers and they should be held accountable to a higher standard of conduct. HSI will continue to work jointly with our law enforcement partners to investigate those who exploit their official public positions for their personal benefit.”

The bribery charge to which Williams pleaded guilty is punishable by a maximum potential penalty of five years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. As part of the plea agreement, Williams must forfeit $64,878.22, representing the sum of $33,765.52 worth of bribe proceeds and $31,112.70 worth of fraud proceeds.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Michael Harpster in Philadelphia; special agents of IRS-Criminal Investigation, Philadelphia Office, under the direction of Acting Special Agent in Charge Gregory Floyd, 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. He also thanked the U.S. Department of Health and Human Services-Office of Inspector General, under the direction of Special Agent in Charge Nick DiGiulio, for its participation in the investigation.

The U.S. Attorney in the Eastern District of Pennsylvania recused his office from the investigation involving the Philadelphia District Attorney’s Office, and the matter was assigned to the U.S. Attorney’s Office for the District of New Jersey. Two prosecutors from the Eastern District of Pennsylvania office were assigned to the case, subject to the supervision of prosecutors in the New Jersey office.

The government is represented by Deputy Chief Eric W. Moran of the U.S. Attorney’s Office Criminal Division in Newark and Chief of Appeals Robert A. Zauzmer and Assistant U.S. Attorney Vineet Gauri of the U.S. Attorney’s Office in Philadelphia.

Defense counsel: Thomas F. Burke Esq., Philadelphia.

NEWARK, N.J. – An Iselin, New Jersey, man who worked as an emergency medical technician and volunteer firefighter was charged today with soliciting a child to take nude pictures of himself and send them online, Acting U.S. Attorney William E. Fitzpatrick announced.

Zachary Motta, 22, is charged by complaint with one count of sexual exploitation of children. He appeared in Newark federal court today before U.S. Magistrate Judge Steven C. Mannion and was detained.

According to the complaint:

Beginning in October 2016, Motta engaged in sexually explicit communications with a boy who told Motta that he was 12-years old. Over the course of their correspondence, Motta sent the minor victim images of himself in his EMT and firefighter uniforms and asked the boy to send him nude pictures. Motta warned the boy, “Just don’t get caught.” In response to Motta’s requests, the boy sent Motta nude images of his genitals on two occasions.

The charge of sexual exploitation of a child carries a mandatory minimum penalty of 15 years in prison, a maximum potential penalty of 30 years in prison and a $250,000 fine.

Acting U.S. Attorney Fitzpatrick credited special agents with the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, and the Middlesex County Prosecutor’s Office, under the direction of Andrew C. Carey, with the investigation.

The government is represented by Assistant U.S. Attorney Danielle Alfonzo Walsman of the U.S. Attorney’s Office Criminal Division in Newark.

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

Defense counsel: Assistant Federal Public Defender Carol Gillen

CAMDEN, N.J. – A Virginia man admitted today that he robbed four banks – two in New Jersey and two in Baltimore, Maryland – during a spree in December 2016, Acting U.S. Attorney William E. Fitzpatrick announced.

Bruce Wayne Higgins, 43, of Herndon, Virginia, pleaded guilty before U.S. District Court Judge Renée Marie Bumb in Camden federal court to a four-count information charging him with robbing: (1) Dec. 10, 2016 – Howard Bank in Baltimore; (2) Dec. 13, 2016 -- Northwest Bank in Baltimore; (3) Dec.15, 2016 – TD Bank N.A. in Ocean City, New Jersey; and (4) Dec. 16, 2016 – Wells Fargo Bank in Atlantic City, New Jersey.

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

On Dec. 15, 2016, a man entered a TD Bank in Ocean City and presented a teller with a note that read: “GUN IN Pocket, MONEY NOW or –BANG-.” He then took cash from the teller and fled on foot. Law enforcement officers issued a bulletin with a bank surveillance photograph. The robber was later identified as Higgins.

Through coordination with the FBI in Baltimore, Maryland, New Jersey agents learned that a robber with a similar physical description had robbed two banks and a business earlier that week in Baltimore.

On Dec. 16, 2017, a man fitting Higgins’s description walked into a TD Bank in Atlantic City. After recognizing Higgins from the police bulletin, a bank employee triggered the bank’s “hold-up” alarm, and Higgins left the bank and got into a taxicab. Officers from the Atlantic City Police Department (ACPD) arrived at the TD Bank and, following up on information provided by witnesses, issued a bulletin describing the taxicab’s number and direction of travel.

Having received the bulletin describing the taxicab, another ACPD officer located the taxicab near a Wells Fargo Bank in Atlantic City while Higgins was allegedly in the process of robbing that bank. Higgins entered the Wells Fargo Bank and presented a teller with a note that read, “Gun in Pocket, Money Now or Bang now.” After Higgins took the money and fled the bank, ACPD officers arrested him.

Higgins admitted to robbing two banks and a business in Baltimore, Maryland, as well as the two New Jersey banks. During each of the bank robberies, Higgins threatened the bank’s employees and fled.

Higgins faces a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense on each bank robbery. Under the terms of the plea agreement, Higgins has agreed to make full restitution to the banks – as well as to the victim of another robbery in Baltimore – for all of the losses resulting from his robbery spree. Sentencing is scheduled for Oct. 6, 2017.

Acting U.S. Attorney Fitzpatrick credited special agents with the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark and Special Agent in Charge Gordon Johnson in Baltimore; the Ocean City Police Department, under the direction of Chief Chad Callahan; the Atlantic City Police Department, under the direction of Chief Henry White; the Cape May County Prosecutor’s Office, under the direction of Prosecutor Robert L. Taylor; the Atlantic County Prosecutor’s Office, under the direction of Prosecutor Damon Tyner; the Baltimore County Police, under the direction of Chief Terrance Gordon; and the Fairfax County Police, under the direction of Chief of Police Col., Edwin C. Roessler Jr., with the investigation leading to today’s guilty plea.

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

CAMDEN, N.J. – A sports medicine doctor with a practice in Toms River, New Jersey, was sentenced today to one year and one day in prison for accepting more than $60,000 in cash bribes in return for referring pain cream prescriptions and falsifying health records on behalf of Prescriptions R Us (PRU), a compound pharmacy in Lakewood, New Jersey, Acting U.S. Attorney William E. Fitzpatrick announced.

James Morales, 47, of Toms River, previously pleaded guilty before U.S. District Judge Joseph H. Rodriguez to an information charging him with conspiracy to accept kickbacks and commit health care fraud. Judge Rodriguez imposed the sentence today in Camden federal court.

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

PRU was owned and operated by Vladimir Kleyman, 46, of Lakewood, New Jersey. As a compounding pharmacy, PRU prepared medication using different types and dosages of drugs in order to provide more personalized medications for patients. PRU supplied a topical cream for pain treatment that was made from ketamine (a Schedule III non-narcotic), lidocaine, diclofenac and other ingredients.

Morales operated Shore Sports Medicine, a medical practice in Toms River. Morales admitted that from February 2013 through December 2013, he accepted at least $60,000 in cash bribes from PRU in exchange for referring pain cream prescriptions.

Morales also admitted that on Dec. 19, 2013, Kleyman told Morales that the quantity of pain cream that Morales had prescribed was too high to get reimbursed by Horizon, a private health insurance plan. Kleyman asked Morales to start omitting quantity information on his prescriptions for the compounded pain cream. Morales admitted that he agreed to omit quantity information on prescriptions for patients enrolled in Horizon in order to help PRU obtain reimbursements.

In addition to the prison term, Judge Rodriguez sentenced Morales to two years of supervised release and pay $78,018 in restitution. The judge also entered a forfeiture order of $90,000 and fined Morales $5,000.

Kleyman previously pleaded guilty to conspiring to pay kickbacks in exchange for prescription referrals and committing health care fraud. He was sentenced on Nov. 4, 2015, to 20 months in prison, three years of supervised release and ordered to pay restitution of $477,000.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher; and 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 leading to today’s sentencing.

The government is represented by Assistant U.S. Attorney Jacob T. Elberg, Chief of the Health Care & Government Fraud Unit in Newark.

The health care fraud practice at the New Jersey U.S. Attorney’s Office was reorganized to create a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since 2010, the office has recovered more than $1.36 billion in health care fraud and government fraud settlements, judgments, fines, restitution and forfeiture under the False Claims Act, the Food, Drug and Cosmetic Act and other statutes.

Defense counsel: A. Ross Pearlson Esq., Matthew E. Beck Esq., William Finizio Esq., West Orange, New Jersey

NEWARK, N.J. – Three individuals appeared in federal court today to face allegations that they conspired to distribute multi-kilogram quantities of cocaine in the New Brunswick, New Jersey area, Acting U.S. Attorney William E. Fitzpatrick announced.

 

Palemon Silvestre Sierra, 41, Indhira de los Santos Padilla, 33, both of New Brunswick, and Yunior Martinez-Jimenez, 30, of Somerset, New Jersey, are charged by complaint with one count of conspiracy to distribute five kilograms or more of cocaine. They were arrested June 27, 2017 and appeared today before U.S. Magistrate Judge Steven C. Mannion in Newark federal court.

 

According to the complaint:

 

On June 27, 2017, Martinez-Jimenez met two individuals at a location on Remsen Avenue in New Brunswick to allegedly sell two kilograms of cocaine. Padilla was in a car driven by Martinez-Jimenez.

 

After one of the individuals refused to follow Martinez-Jimenez to a second location to pick up the drugs, Martinez-Jimenez and Padilla traveled to a residence on Redmond Street in New Brunswick. Law enforcement observed Sierra exit the residence, retrieve an empty bag from Martinez- Jimenez’s vehicle, return to the residence and emerge minutes later with the bag, which he gave back to Martinez-Jimenez and Padilla.

 

Martinez-Jimenez and Padilla went back to meet the two individuals at the Remsen Avenue location. After Padilla handed the bag through the passenger side window of the individuals’ vehicle, law enforcement converged on the scene and arrested Martinez-Jimenez and Padilla. They also found two kilograms of cocaine in the bag.

 

At the direction of law enforcement, Martinez-Jimenez delivered the narcotics proceeds to Sierra at the Redmond Street residence. Sierra was then arrested. Afterwards, law enforcement searched the residence and seized approximately six more kilograms of cocaine from Sierra’s bedroom.

The possession with intent to distribute charge carries a minimum penalty of 10 years in prison, a maximum potential penalty of life in prison and a $10 million fine.

 

Acting U.S. Attorney William E. Fitzpatrick credited special agents of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), under the direction of Acting Special Agent in Charge Brian A. Michael, with the investigation.

 

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

 

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

 

NEWARK, N.J. – A Middlesex County, New Jersey, man charged with stealing his late great aunt’s Social Security benefits for 18 years made his initial court appearance today, Acting U.S. Attorney William E. Fitzpatrick announced.

Lance Nelson, 56, of Perth Amboy, New Jersey, is charged by complaint with stealing $184,936 in benefits from the Social Security Administration between 1998 and 2016. Nelson appeared before U.S. Magistrate Judge Steven C. Mannion in Newark federal court.

According to the complaint:

Nelson’s great aunt received Social Security benefits, which were sent to a joint bank account that she shared with Nelson at Bank of America. In February 1998, Nelson’s great aunt died, and the Social Security Administration, unaware of her death, continued to issue her monthly retirement benefits. From March 1998 until February 2016, the Social Security Administration sent $184,936 to the joint account.  Nelson, who was not entitled to receive his great aunt’s retirement benefits, used the money for his own benefit. Between August 2009 and March 2016, Nelson caused $52,367 to be transferred from the joint account into Nelson’s individual savings and checking accounts. He also used ATMs to withdraw approximately $30,000 from the joint account between April 2011 and October 2015. Since at least 1998, Nelson earned $36,868 to $64,272 per year as an assistant zoning officer for the City of Perth Amboy.

The theft of federal funds charge carries a maximum potential penalty of up to 10 years in prison and a fine of up to $250,000, or twice the gross pecuniary gain or loss associated with the offense.

Acting U.S. Attorney Fitzpatrick credited special agents with the Social Security Administration - Office of the Inspector General, under the direction of Special Agent-in-Charge John F. Grasso of the New York Field Division, with the investigation leading to the charge.  

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

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

 

CAMDEN, N.J. – A Camden man today admitted selling crack cocaine, Acting U.S. Attorney William E. Fitzpatrick announced.

Nafeez Griffin, a/k/a “Feez,” 31, pleaded guilty before U.S. District Judge Jerome B. Simandle in Camden federal court to an information charging him with one count of distribution and possession with intent to distribute cocaine base.

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

Griffin admitted that on Nov. 30, 2015, he sold crack cocaine to an undercover officer on the 1100 block of Lansdowne Avenue, which was then under the control of a drug distribution organization of which he was a member. Griffin also admitted that other members of the organization supplied drugs to him, and that he made sales of crack cocaine on other occasions. Griffin and others were originally charged by complaint on Sept. 9, 2016, following a long-term investigation by the FBI’s South Jersey Violent Offender and Gang Task Force. Law enforcement officers seized drugs and recovered two handguns that were kept by members of the conspiracy in connection with the organization’s drug trafficking activities. Investigators also intercepted communications pursuant to court-authorized wiretaps on cellular telephones used by several members of the conspiracy.

The count to which Griffin pleaded guilty carries a maximum potential penalty of 20 years in prison and a $1 million fine. Sentencing is scheduled for Oct. 6, 2017.

Acting U.S. Attorney Fitzpatrick 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. Rick Fuentes, with the investigation leading to today’s guilty plea.

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: Justin T. Loughry Esq., Camden

NEWARK, N.J. – A Pakistani citizen was sentenced today to 48 months in prison for laundering more than $19.6 million on behalf of the perpetrators of a massive international computer hacking and telecommunications fraud scheme, Acting U.S. Attorney William E. Fitzpatrick announced.

Muhammad Sohail Qasmani, 49, formerly of Bangkok, Thailand, previously pleaded guilty before U.S. District Judge Katharine S. Hayden to an information charging him with one count of conspiracy to commit wire fraud. Judge Hayden imposed the sentence today in Newark federal court.

According to documents filed in this and related cases and statements made in court:

This massive international telecommunications fraud scheme, allegedly led by Noor Aziz, 55, of Karachi, Pakistan, and responsible for total losses exceeding $70 million, involved unauthorized access to the computer systems – commonly known as PBX systems – that ran the internal telephone networks of numerous businesses and organizations in the United States. Foreign-based hackers targeted the telephone systems of the victim corporations and placed calls to those systems in an attempt to identify unused telephone extensions. Once the hackers identified unused extensions, they illegally reprogrammed the telephone systems so that they could be used to make unlimited long distance calls, all of which were ultimately charged back to the victim corporations.

The hacked telephone systems were then used to make calls to premium telephone numbers – such as purported chat lines, adult entertainment, and psychic hotlines – that generated revenue based on the calls’ duration and were set up and controlled by Aziz. In actuality, the numbers provided no actual services. Telephone company representatives who suspected fraudulent activity and called the numbers heard recordings of fake rings, fake password prompts, fake voicemail messages, music, or dead air on continuous loops.

In 2008, Qasmani, who operated a money laundering and smuggling business in Thailand, agreed to launder proceeds of the scheme for Aziz. In furtherance of the conspiracy, Qasmani established multiple bank accounts to receive the money generated by the illicit telephone traffic. Qasmani also paid the hackers and dialers who worked for Aziz to keep the scheme going. 

Specifically, over nearly four years, Qasmani initiated money transfers to approximately 650 unique transferees, located in at least 10 countries, including the Philippines, India, Pakistan, Malaysia, China, the United Arab Emirates, Saudi Arabia, Indonesia, Thailand, and Italy.  Qasmani moved a total of approximately $19.6 million in fraud proceeds from November 2008 through Dec. 31, 2012. Qasmani kept laundering the money even after Aziz was arrested in connection with this scheme and later released by foreign authorities.

On Dec. 22, 2014, Special Agents of the FBI arrested Qasmani at Los Angeles International Airport after he arrived on a flight from Bangkok.  

In addition to the prison term, Judge Hayden sentenced Qasmani to two years of supervised release. Qasmani must also forfeit $25,000 and pay restitution of $71,761,956.34.

Aziz was charged by indictment on June 20, 2012 and remains a fugitive. For more information, visit the FBI Cyber's Most Wanted list.  The charges and allegations against him are merely accusations, and he is considered innocent unless and until proven guilty.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher, with the investigation leading to today’s guilty plea.  He also thanked officers with U.S. Immigration and Customs Enforcement's (ICE) Enforcement and Removal Operations (ERO) and U.S. Customs and Border Protection for their assistance in this case.

The government is represented by Assistant U.S. Attorney L. Judson Welle, coordinator of the Computer Hacking and Intellectual Property Section of the Economic Crimes Unit.

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

NEWARK, N.J. – A former Jersey City police officer today admitted accepting approximately $55,000 in corrupt payments in exchange for helping employers operate at worksites without the required presence of an off-duty police officer and for helping a police officer obtain compensation for off-duty work he did not perform, Acting U.S. Attorney William E. Fitzpatrick announced. 

Anthony Iannicco, 48, of Jersey City, pleaded guilty before U.S. District Judge John Michael Vazquez in Newark federal court to an information charging him with one count of conspiracy to commit fraud and accept corrupt payments.

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

Iannicco was a police officer with the Jersey City Police Department (JCPD) from 1995 to 2016. From 2008 through 2016, his duties included serving as the “assistant pick coordinator” for Jersey City’s West District. As the assistant pick coordinator, Iannicco assigned police officers to off-duty details. 

Under Jersey City’s municipal code, off-duty police officers were not permitted to receive cash payments directly from off-duty employers. Rather, the employers were supposed to pay Jersey City, which would then pay the off-duty police officers, minus certain fees, taxes and deductions, including an administrative fee payable to Jersey City per hour that the off-duty police officers worked. 

Iannicco conspired with numerous employers to cut Jersey City out of the process of hiring and compensating off-duty police officers. Generally, Iannicco permitted these employers to operate at worksites without the presence of a police officer when such a presence was required. In exchange, Iannicco accepted cash payments directly from these employers in violation of Jersey City rules and regulations.

In addition, Iannicco provided fraudulent off-duty employment vouchers to another police officer, identified in the information as “Co-Conspirator 1,” falsely representing that Co-Conspirator 1 completed off-duty assignments that Co-Conspirator 1 never worked. Jersey City subsequently paid Co-Conspirator 1 based on these fraudulent vouchers. In exchange for providing these fraudulent vouchers, Iannicco accepted cash payments from Co-Conspirator 1.
 
Altogether, from 2011 to 2016, Iannicco collected payments of approximately $55,000 directly from off-duty employers and from Co-Conspirator 1.

Iannicco faces a maximum potential penalty of five years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Pursuant to the plea agreement, Iannicco is required to forfeit the $55,000 that he received. Sentencing is set for Oct. 3, 2017.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy A. Gallagher in Newark, with the investigation.  

JCPD is cooperating with the investigation.   

The government is represented by Assistant U.S. Attorney Vikas Khanna of the U.S. Attorney’s Office Special Prosecutions Division in Newark.

Defense counsel: John A. Azzarello Esq., Morristown, New Jersey

NEWARK, N.J. - A New York man was sentenced today to 41 months in prison for a two-year scheme in which he defrauded multiple victims who believed they were investing in businesses that offered a popular fitness training program, Acting U.S. Attorney William E. Fitzpatrick announced.

 

Joshua Bryce Newman, 37, previously pleaded guilty before U.S. District Judge William H. Walls to an information charging him with one count of wire fraud. Judge Walls imposed the sentence today in Newark federal court.

 

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

 

Newman was a self-styled entrepreneur who engaged in a variety of business ventures, including venture capital work, a film production company, and, more recently, in businesses offering a popular fitness training program. By 2011 and 2012, Newman found himself with mounting legal and financial troubles largely as a result of judgments and liens filed against him and his film production company, Cyan Pictures, relating to their failed film project that was meant to produce and distribute a film about the New York Yankees entitled “Keeper of the Pinstripes.”

 

From 2012, Newman made material misrepresentations to solicit investments and loans purportedly for various fitness business ventures he was working on, when his true intent was to use the money for his own purposes, including repaying others who had invested in one of his prior projects.

 

Newman often supplied his victims with doctored or bogus documentation in order to obtain the investment capital and loans. He then lulled his victims into believing that their investment money was safe or that he was in a position to repay their loans by making further misrepresentations and supplying them with additional phony documents. The false documents he used included doctored operating agreements, false statements of ownership percentages held by various individuals, and bogus documents purporting to show the amount of annual partnership gains or losses reported to the IRS.

 

Newman also misrepresented to his potential partners, purported investors, and lenders in one of his business ventures that he had raised millions of dollars in funding for the project, when he knew that no such funds had been raised.

 

When investors raised concerns about their investments, Newman typically gave them false assurances and agreed to return the funds. In reality, he often had no funds to return, and so he would make various excuses, including that he had sent wires that had been delayed in the banking system when no such wire had been sent. He often stalled for time by giving his victims checks drawn on accounts with insufficient funds to cover the amount of the checks.

 

On at least one occasion, Newman sent a picture of the purported wire transfer order for $165,000 to an investor who had threatened legal action and told the investor that the funds were on the way, even though Newman knew that no such funds had been or would be furnished to the investor. Newman defrauded approximately 30 victims of approximately $3 million.

 

In addition to the prison term, Judge Walls sentenced Newman to three years of supervised release and ordered him to pay restitution of $3,118,165.82.

 

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, for the investigation leading to today’s sentencing.

 

The government is represented by Assistant U.S. Attorney Paul A. Murphy, Chief of the U.S. Attorney’s Office’s Economic Crimes Unit.

 

Defense counsel: Priya Chaudhry Esq., New York; Eric Kanefsky Esq., Newark

NEWARK, N.J. – A Middlesex County, New Jersey, man was sentenced today to 94 months prison for distributing and possessing images of child sexual abuse, Acting U.S. Attorney William E. Fitzpatrick announced.

 

John Fricovsky, 58, of Edison, New Jersey, previously pleaded guilty before U.S. District Judge John Michael Vazquez to an information charging him with one count of distribution of child pornography and one count of possession of child pornography. Judge Vazquez imposed the sentence today in Newark federal court.

 

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

 

Fricovsky admitted that in February 2015 he sent an email attaching an image of child sexual abuse involving a child under the age of 12. He also admitted to, in December 2015, possessing computer devices containing at least 10, but fewer than 150, images of child sexual abuse.

 

In addition to the prison term, Judge Vazquez sentenced Fricovsky to 10 years of supervised release.

 

Acting U.S. Attorney Fitzpatrick credited special agents with Homeland Security Investigations, under the direction of Acting Special Agent in Charge Brian Michael, with the investigation leading to today’s sentencing.

 

The government is represented by Assistant U.S. Attorney Danielle Alfonzo Walsman of the U.S. Attorney’s Office Criminal Division in Newark.

 

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

NEWARK, N.J. – A Perth Amboy, New Jersey, man today admitted his role in a conspiracy to distribute approximately 1.5 kilograms of ethylone, a Schedule I controlled substance, Acting U.S. Attorney William E. Fitzpatrick announced.

Paul Hutchison, 35, pleaded guilty before U.S. District Judge Kevin McNulty in Newark federal court to an information charging him with one count of conspiring to distribute ethylone.

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

On Oct. 16, 2015, a lawful search of Hutchison’s residence in Perth Amboy revealed that he possessed approximately 1.5 kilograms of ethlyone, which he conspired with others to distribute in and around Middlesex County. Ethylone, sometimes referred to as “bath salts” or “molly,” is an illegal synthetic drug that stimulates the central nervous system and can cause hallucinogenic effects.

The conspiracy charge to which Hutchison pleaded guilty carries a maximum potential penalty of 20 years in prison and a $1 million fine. Sentencing is scheduled for Oct. 16, 2017.

Acting U.S. Attorney Fitzpatrick credited special agents of the Drug Enforcement Administration (DEA), under the direction of Charge Carl J. Kotowski in Newark, with the investigation.

The government is represented by Assistant U.S. Attorney Jonathan M. Peck of the U.S. Attorney’s Office Organized Crime/Drug Enforcement Task Force Unit.

Defense Counsel: Bruce Regenstreich Esq., New York

Plea Agreement Calls for 25-Year Prison Sentence

NEWARK, N.J. – A member of the New Jersey set of the Grape Street Crips today admitted his role in a racketeering conspiracy that involved shooting rival gang members and conspiracies to distribute heroin and crack-cocaine, Acting U.S. Attorney William E. Fitzpatrick announced.

Justin Carnegie, a/k/a “Dew Hi,” a/k/a “Dew,” a/k/a “D,” 30, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to five counts in a sixth superseding indictment charging him with RICO conspiracy, conspiracy to commit aggravated assault with a dangerous weapon, conspiracy to possess a firearm, and separate conspiracies to distribute one kilogram of heroin and 280 grams or more of crack-cocaine.

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

The N.J. Grape Street Crips controlled drug trafficking and other criminal activities in various areas of Newark, including the area of 6th Avenue and North 5th Street and public-housing complexes at Pennington Court, Oscar Miles, the Millard Terrell Homes, the John W. Hyatt homes and the former James Baxter Terrace complex.

Carnegie admitted that on Oct. 7, 2013, he and other gang members sought to avenge the murder of a fellow gang member who had recently been killed by rival gang members. Carnegie and his fellow gang members travelled to the area of Avon Avenue in Newark where one of Carnegie’s fellow gang members discharged approximately 14 rounds in an attempt to shoot members of the rival gang. After returning to their staging area after the shooting, Carnegie fled law enforcement who attempted to arrest him and his fellow gang members.

Carnegie and other gang members frequently used social media to promote the gang’s reputation for violence and drug-trafficking. For example, Carnegie has previously stated “we be straight rat killing,” referring to the gang’s practice of intimidating or killing cooperating witnesses.

Carnegie and fellow gang members frequently carried and stock-piled firearms in furtherance of the gang’s activities. In May 2010, Carnegie stored a loaded Romarm SA Cugir 7.62x39 assault rifle and an American Industries Calico M100 .22LR carbine, along with ammunition for both weapons, in Orange, New Jersey.

Finally, Carnegie admitted to participating in conspiracies to distribute one kilogram or more of heroin and 180 grams or more of crack-cocaine.

Under the terms of the plea agreement, if accepted by the court, Carnegie will be sentenced to 25 years in prison and 10 years of supervised release. Sentencing is scheduled for Oct. 10, 2017.

Acting U.S. Attorney Fitzpatrick credited special agents of the Drug Enforcement Administration (DEA), under the direction of Special Agent in Charge Carl J. Kotowski, and special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher, with the investigation. Acting U.S. Attorney Fitzpatrick also thanked prosecutors and detectives of the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Robert D. Laurino, police officers and detectives of the Newark Department of Public Safety, under the direction of Director Anthony F. Ambrose, and the Essex County Sheriff’s Office, under the direction of Armando B. Fontoura, for their work on the investigation.

The government is represented by Assistant U.S. Attorneys Osmar J. Benvenuto and Barry Kamar of the District of New Jersey’s Criminal Division in Newark.

This case was conducted under the auspices of the Organized Crime Drug Enforcement Task Force (OCDETF) and the FBI’s Safe Streets Task Force, a partnership between federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations and those primarily responsible for the nation’s illegal drug supply.

Defense counsel: John J. Roberts Esq., Chatham, New Jersey.