District of New Jersey

A New Jersey man pleaded guilty today in the U.S. District Court for the District of New Jersey in Newark, to one count of theft of public money, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division.

 

According to information and documents presented to the court, from approximately December 2010 through April 2014, Derrick M. Madison, 39, of Jersey City, New Jersey, used the Internal Revenue Service’s (IRS) telephone payment system hundreds of times in an effort to make fake payments to a taxpayer account he controlled from bank accounts that were closed, frozen or had minimal balances. The goal was to induce the IRS to fully credit these fake payments and then for the IRS to “refund” Madison for his overpayments. On one occasion, the IRS issued Madison a $170,681 refund check, which he deposited into his bank account.

 

Sentencing is scheduled for June 12. Madison faces a statutory maximum sentence of 10 years in prison, a period of supervised release, restitution and monetary penalties.

 

Acting Deputy Assistant Attorney General Goldberg thanked special agents of IRS-Criminal Investigation, who conducted the investigation, and Trial Attorneys Eric Powers and Jeffrey Bender of the Tax Division, who are prosecuting the case.

 

Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.

NEWARK, N.J. – A California man was sentenced today to 76 months in prison for his role in a conspiracy to traffic approximately 12 kilograms of cocaine from California to New Jersey, U.S. Attorney Paul J. Fishman announced.

Jesus Raul Iribe, 38, of Riverside, California, previously pleaded guilty before U.S. District Court Judge Kevin McNulty to an information charging him with one count of conspiring to distribute more than 500 grams of cocaine.

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

On Feb. 8, 2013, law enforcement officers recorded and observed meetings between Iribe and other conspirators in which they allegedly planned to use a tractor-trailer to transport cocaine from California to New Jersey and other destinations along the East Coast. Eventually, law enforcement followed the tractor trailer to Bronx, New York, where they recovered a produce box containing 12 kilograms of cocaine. Iribe admitted that he conspired with others to traffic the cocaine from California to New Jersey.

In addition to the prison term, Judge McNulty sentenced Iribe to five years of supervised release. Under terms of the plea agreement, he must also forfeit $446,310 in cash, three handguns, and an AR-1 assault rifle that were recovered when he was arrested in March 2015.

U.S. Attorney Fishman credited special agents and task force officers of the Drug Enforcement Administration’s New Jersey Division, under the direction of Special Agent in Charge Carl J. Kotowski in Newark, the DEA Los Angeles Field Office, and the Fontana, California Police Department.

The government is represented by Assistant U.S. Attorney Jonathan M. Peck of the U.S. Attorney’s Office General Crimes Unit.

 

NEWARK, N.J. – A doctor practicing in Passaic County, New Jersey, today admitted taking bribes in connection with a long-running and elaborate test referral scheme operated by Biodiagnostic Laboratory Services LLC (BLS), of Parsippany, New Jersey, its president and numerous associates, U.S. Attorney Paul J. Fishman announced today.

Salvatore Conte, 52, of Totowa, New Jersey, pleaded guilty to Count One, Count Two, Count Five, and Count Eight of an indictment charging him with conspiracy to violate the Anti-Kickback Statute and the Federal Travel Act by accepting bribes, one substantive violation of the Anti-Kickback Statute, one substantive violation of the Federal Travel Act, and one substantive violation of wire fraud. Conte pleaded guilty today before U.S. District Judge Stanley R. Chesler in Newark federal court.

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

Conte admitted accepting bribes from BLS employees and associates in the form of sham rental, service, and consulting agreements. From February 2009 through April 2013, Conte received bribes totaling approximately $130,000 from BLS employees and associates. Conte’s referrals generated approximately $525,000 in lab business for BLS.

Conte was the fifth physician indicted in connection with the BLS bribery scheme. Ahmed El Soury and Thomas Savino were indicted on Dec. 13, 2016 and Dec. 20, 2016, respectively. Brett Ostrager – who was indicted Aug. 11, 2015 and pleaded guilty on Dec. 22, 2015 – was sentenced on June 8, 2016 to 37 months in prison. Bernard Greenspan was indicted on March 14, 2016 and his trial is ongoing before U.S. District Judge William H. Walls.

The investigation has thus far resulted in 42 guilty pleas – 28 of them from doctors – in connection with the bribery scheme, which its organizers have admitted involved millions of dollars in bribes and resulted in more than $100 million in payments to BLS from Medicare and various private insurance companies. It is believed to be the largest number of medical professionals ever prosecuted in a bribery case.

The investigation has to date recovered more than $12 million through forfeiture. On June 28, 2016, BLS, which is no longer operational, pleaded guilty and was required to forfeit all of its assets.

The conspiracy, Anti-Kickback, and Federal Travel Act counts to which Conte pleaded guilty are each punishable by a maximum potential penalty of five years in prison. The wire fraud charge is punishable by a maximum potential penalty of 20 years in prison. Each count also carries a maximum $250,000 fine, or twice the gross gain or loss from the offense. Conte’s sentencing is scheduled for June 6, 2017.

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark; inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge James V. Buthorn; IRS–Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen; and the U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert with the ongoing investigation.

The government is represented by Assistant U.S. Attorneys Joseph N. Minish, Danielle Alfonzo Walsman, and Jacob T. Elberg, Chief of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark, as well as Assistant U.S. Attorney Barbara Ward, Acting Chief of the office’s Asset Forfeiture and Money Laundering Unit.

U.S. Attorney Fishman reorganized the health care fraud practice at the New Jersey U.S. Attorney’s Office shortly after taking office, including creating 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 $1.32 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: Howard Brownstein Esq., Jersey City, New Jersey

NEWARK, N.J. – A Milford, Ohio, man today admitted using an Essex County, New Jersey, medical company’s credit card without the company’s permission or consent to fraudulently obtain more than $950,000, U.S. Attorney Paul J Fishman announced.

John Tekulve, 44, pleaded guilty before U.S. District Judge Katharine S. Hayden in Newark federal court to an information charging him with wire fraud.

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

From January 2011 through October 2012, Tekulve owned a medical supply company that sold products to an Essex County medical company. He obtained the company’s credit card information, which he used to fraudulently bill the company nearly $1 million for products and services that neither Tekulve nor his medical supply company provided. Tekulve then used the proceeds of the scheme for his own purposes, including the purchase of high-end automobiles and jewelry.

The count of wire fraud is punishable by a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense.

U.S. Attorney Fishman credited special agents with the U.S. Secret Service, under the direction of Special Agent in Charge Mark McKevitt in Newark, with the investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorney Veronica Allende of the U.S. Attorney’s Office in Trenton.

Defense counsel: Peter Carter Esq., Newark

NEWARK, N.J. – A Middlesex County, New Jersey, man today admitted distributing and possessing images of child sexual abuse, U.S. Attorney Paul J. Fishman announced.

 

John Fricovsky, 57, of Edison, New Jersey, pleaded guilty before U.S. District Judge John Michael Vazquez in Newark federal court to an information charging him with one count of distribution of child pornography and one count of possession of child pornography.

 

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.

 

The possession of child pornography charge to which Fricovsky pleaded guilty carries a maximum potential penalty of 20 years in prison and a $250,000 fine. Fricovsky will be required to register as a sex offender. Sentencing is currently scheduled for June 7, 2017.

 

U.S. Attorney Fishman credited Special Agents with Homeland Security Investigations, under the direction of Special Agent in Charge Terence S. Opiola, with the investigation leading to today’s guilty plea.

 

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

NEWARK, N.J. – A former pharmaceutical company employee today admitted accepting thousands of dollars in exchange for filling medically unnecessary prescriptions for compounded medications for herself and her husband, causing losses of $956,885, U.S. Attorney Paul J. Fishman announced.

Julie Andresen, 39, of Haddonfield, New Jersey, pleaded guilty before U.S. District Judge John Michael Vazquez in Newark federal court to an information charging her with conspiracy to commit health care fraud.

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

Andresen, a former employee of a New Jersey pharmaceutical company, admitted that from September 2014 through September 2015, she received payments from a marketing business – identified in the information as “Company A” – for filling and obtaining medically unnecessary prescription compounded medications for herself and her husband through the pharmaceutical company’s prescription drug benefit plan.

As part of the scheme, Andresen approached a doctor – who was a close friend – at social gatherings that they attended. She would give the doctor pre-printed forms listing compounded medications and ask the doctor to authorize the medications. The doctor did so, as well as authorizing multiple refills. Andresen faxed prescriptions to compounding pharmacies located outside of New Jersey designated by Company A. The compounding pharmacies would fill and bill Andresen’s prescription drug benefit plan. The pharmaceutical company’s prescription drug benefit plan reimbursed the compounding pharmacies $13,572 to $43,689 for each compounded medication Andresen and her husband received.

The compounding pharmacies would pay Company A a percentage of the reimbursement amount, and Company A would pay Andresen a percentage of the amount Company A received from the compounding pharmacies. Andresen received a total of $161,378 from Company A for her role in the conspiracy. The pharmaceutical company lost $956,885 from this scheme.

The conspiracy to commit health care fraud count to which Andresen pleaded guilty carries a maximum penalty of 10 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Sentencing is scheduled for June 7, 2017.

On June 29, 2016, Stephanie Naar, 27, of St. Louis, Missouri, who had been an employee of the same pharmaceutical company as Andresen, pleaded guilty before Judge Vazquez and admitted accepting thousands of dollars in exchange for obtaining and filling her own medically unnecessary prescriptions for compounded medications.

On July 19, 2016, Peter Pappas, 44, of Drexel Hill, Pennsylvania, another former employee of the same New Jersey pharmaceutical company as Andresen, also pleaded guilty before Judge Vazquez and admitted to accepting thousands of dollars in exchange for obtaining and filling his own medically unnecessary prescriptions for compounded medications. Pappas also admitted to recruiting others into this scheme.

Naar and Pappas both await sentencing.

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark; and U.S. Department of Defense, Office of the Inspector General, Defense Criminal Investigative Service, under the direction of Special Agent in Charge Craig Rupert, with the ongoing investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorney Erica Liu of the United States Attorney’s Office, Health Care and Government Fraud Unit in Newark.

U.S. Attorney Paul J. Fishman reorganized the health care fraud practice at the New Jersey U.S. Attorney’s Office shortly after taking office, including creating 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 $1.32 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: Judson Aaron Esq., Philadelphia

NEWARK, N.J. – A Stamford, Connecticut, man today admitted paying bribes in order to secure a contract between his metallurgical technology company and a medical device company, U.S. Attorney Paul J. Fishman announced.

Eugene Ostrovsky, 56, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to an information charging him with violating the Federal Travel Act.

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

Ostrovsky was a principal at a metallurgic technology company in New York. Ostrovsky admitted that he and others sought a multimillion-dollar supply contract with a medical device company in New Jersey. From 2012 through 2013, Ostrovsky and others paid approximately $70,000 in illicit bribes to an employee of the medical device company – Daniel Lawrynowicz, 47, of Monroe, New York – in return for Lawrynowicz’s assistance in securing the contract.

The count of violating the Federal Travel Act carries a maximum potential penalty of five years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Ostrovsky must also forfeit $1.1 million as part of today’s guilty plea. Sentencing is scheduled for June 29, 2017.

On March 23, 2016, Lawrynowicz was charged by complaint with accepting the bribe payments. The charge and allegations against him are merely accusations, and he is presumed innocent unless and until proven guilty.

U.S. Attorney Fishman 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 Danielle M. Corcione of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark and Assistant U.S. Attorney Jafer Aftab of the Office’s Asset Forfeiture and Money Laundering Unit.

Defense counsel: Paula M. Junghans Esq.

CAMDEN, N.J. – A Deptford, New Jersey, man was sentenced today to 37 months in prison for robbing five New Jersey banks and one Pennsylvania bank between June 2015 and September 2015, U.S. Attorney Paul J. Fishman announced.

Michael A. Fanelli, a/k/a “Michael Carducci,” 37, previously pleaded guilty before U.S. District Judge Reneé Marie Bumb to an information charging him with six counts of bank robbery. Judge Bumb imposed the sentence today in Camden federal court.

According to documents filed in this case and statements made in court, Fanelli robbed the following banks on the dates set forth below:

Bank

Location

Date

Cornerstone Bank

West Deptford, New Jersey

June 2, 2015

Fulton Bank

Mullica Hill, New Jersey

June 5, 2015

Malvern Federal Savings Bank

Concordville, Pennsylvania

July 22, 2015

Susquehanna Bank

Mullica Hill, New Jersey

July 28, 2015

Susquehanna Bank

Mullica Hill, New Jersey

Aug. 21, 2015

National Penn Bank

Florence, New Jersey

Sept. 24, 2015

 

Fanelli typically robbed each bank by approaching a teller, displaying what appeared to be a firearm, and demanding money.

Fanelli robbed the same Susquehanna Bank on July 28, 2015 and August 21, 2015. Immediately following his robbery of National Penn Bank on Sept. 24, 2015, Fanelli was followed by law enforcement officers to his residence, where he was taken into custody.   

In addition to the prison term, Judge Bumb sentenced Fanelli to three years of supervised release.
 
U.S. Attorney Fishman credited special agents of the FBI’s South Jersey Resident Agency, under the direction of Special Agent in Charge Michael Harpster in Philadelphia, with the investigation. He also thanked the West Deptford, Harrison Township, and Florence Township police departments, as well as the Gloucester County Prosecutor’s Office and the Pennsylvania State Police for their assistance.

The government is represented by Assistant U.S. Attorney Justin C. Danilewitz of the U.S. Attorney’s Office Criminal Division in Camden.

Defense counsel: Lisa Lewis Esq., Assistant Federal Public Defender

TRENTON, N.J. – A Hudson County, New Jersey, man, who served as the senior accountant of the City of Bayonne Department of Community Development (CBDCD) was sentenced today to 21 months in prison for accepting $65,000 in bribe payments in exchange for his assistance in awarding projects funded by U.S. Department of Housing and Urban Development grants, U.S. Attorney Paul J. Fishman announced.

Anselmo Crisonino, 56, of Bayonne, previously pleaded guilty before U.S. District Judge Peter G. Sheridan in Trenton federal court to a four-count information charging him with one count of accepting bribe payments totaling approximately $65,000 from Joseph Arrigo, the owner of a contracting company in Bayonne. Crisonino also pleaded guilty to one count of theft and conversion of federal funds ($422,360), one count of conducting an illegal gambling business, and one count of submitting a false tax return for tax year 2011.

 

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

 

The CBDCD was an agency that received funds from the U.S. Department of Housing and Urban Development (HUD) under a federal program that provided grants up to $20,000 to low income families to rehabilitate their homes and to repair conditions affecting health and safety, accessibility, energy efficiency or code compliance. The CBDCD also provided these HUD funds under the same federal program to nonprofit organizations. Crisonino was responsible for reviewing applications and awarding such funds to qualified applicants.

 

In September 2010, Crisonino solicited cash bribe payments from Arrigo in exchange for Crisonino’s assistance in awarding HUD grant funds from the CBDCD to Arrigo as the owner of Shadow Contracting LLC. From September 2010 to February 2013, Crisonino received cash payments from Arrigo totaling approximately $65,000 in exchange for Crisonino’s assistance in awarding HUD grant funds from the CBDCD to Arrigo that totaled approximately $426,000.

 

Between September 2010 and February 2013, Crisonino awarded HUD grant funds to several contractors and plumbers in Bayonne through the CBDCD, despite the fact that Crisonino knew that the submitted bids for the projects were fraudulent and were the result of collusion by the contractors and plumbers. Crisonino also approved change orders on projects where little to no legitimate work had been done by the contractors and plumbers at the job sites. The approved change orders allowed the CBDCD to disperse additional HUD grant funds to the projects that had already reached the maximum $20,000 grant allotment.

 

Crisonino also pleaded guilty to conducting an illegal gambling business in northern New Jersey. The illegal gambling business was administered and managed through a website that Crisonino and others accessed through usernames and passwords.

 

He admitted making and subscribing a U.S. Individual Tax Return, Form 1040, for tax year 2011 filed with the IRS, which he did not believe to be true and correct as to every material matter, including approximately $65,000 in unreported income through the bribe payments.

 

In addition to the prison term, Judge Sheridan sentenced Crisonino to three years of supervised release and ordered him to pay restitution of $439,000.

 

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark: special agents of the U.S. Department of Housing and Urban Development, Office of the Inspector General, under the direction of Special Agent in Charge Christina Scaringi; and special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen in Newark, with the investigation leading to today’s sentencing plea.

 

The government is represented by Assistant U.S. Attorney Jacques S. Pierre of the Special Prosecutions Division.

 

Defense counsel: Daniel J. Welsh Esq., Jersey City, N.J.

CAMDEN, N.J.  – The owners of popular Ocean City, New Jersey, restaurant chain Manco & Manco Pizza were sentenced today for evading taxes, structuring cash payments to avoid reporting requirements and lying to IRS special agents, U.S. Attorney Paul J. Fishman announced.

Charles Bangle, 57, of Somers Point, New Jersey, was sentenced to 15 months in prison. He previously pleaded guilty before U.S. District Judge Robert B. Kugler in Camden federal court to Count 5 of an indictment charging him with evading taxes with respect to his 2010 personal tax returns and Count 30 charging him with structuring financial transactions in 2011 to avoid reporting requirements. His wife, Mary Bangle, 56, also of Somers Point, was sentenced to three years of probation and fined $3,000. She previously pleaded guilty to Count 7 of the same indictment, which charges her with knowingly making materially false statements to IRS special agents. Judge Kugler imposed the sentences today in Camden federal court.

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

Manco & Manco Pizza – formerly Mack & Manco – is an iconic restaurant located in the heart of Ocean City’s Boardwalk and maintains three stores on the Boardwalk and one store in Somers Point. Charles and Mary Bangle were employees of Mack & Manco Pizza until they purchased a controlling interest in 2011. Charles Bangle handled the day-to-day operations of the business and Mary Bangle was responsible for handling cash and payroll.

Charles Bangle admitted to substantially underreporting his income on his 2010 U.S. individual income tax return, specifically, failing to report additional taxable income that he deposited in cash into his bank account during that year. According to the indictment, by only reporting $127,955 in 2010 and omitting an additional $263,113 in taxable income, Charles Bangle avoided $91,577 in taxes. Charles Bangle also admitted to making cash deposits into his TD Bank account in February of 2011 in increments of less than $10,000 in order to prevent TD Bank from filing a Currency Transaction Report with the U.S. Department of Treasury.

Mary Bangle admitted that she was interviewed by IRS special agents on May 30, 2012, at which time she was asked questions about her personal bank account. Mary Bangle falsely stated that when cash receipts came into the business she only retained enough to pay that week’s payroll and some bills, when in fact she retained cash receipts for her personal use. Mary Bangle also lied to agents about the amount of cash deposited into her personal banking account, which was substantially more that the net pay listed on her W-2 forms issued by Manco and Manco Pizza.

In addition to the prison term, Judge Kugler sentenced Charles Bangle to three years of supervised release, ordered him to pay restitution of $248,560 and fined him $5,000. He allowed Bangle until Sept. 10, 2017, to report to the federal Bureau of Prisons to begin serving his sentence. 
 
U.S. Attorney Fishman credited special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen, with the investigation leading to today’s sentencings.

The government is represented by Assistant U.S. Attorney Jason M. Richardson of the U.S. Attorney's Office Criminal Division in Camden.

Defense counsel: Laurence S. Shtasel Esq., Philadelphia

TRENTON, N.J. – A Yardville, New Jersey, man today admitted using his e-mail account to distribute images of child sexual abuse, U.S. Attorney Paul J. Fishman announced.

Christopher Walsh, 31, pleaded guilty before U.S. District Judge Mary L. Cooper in Trenton federal court to an information charging him with one count of receiving and distributing child pornography.

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

From June 15, 2014 through Jan. 10, 2016, Walsh’s email account either sent or received a total of 1,590 files that contained content constituting child pornography. Walsh, who was a school bus driver, admitted today that on Aug. 2, 2015, he knowingly emailed a video depicting child sexual abuse to another individual.

Walsh faces a maximum potential penalty of 20 years in prison, a minimum penalty of five years in prison, a $250,000 fine, and up to a lifetime of supervised release.

U.S. Attorney Fishman credited special agents of the Department of Homeland Security, Homeland Security Investigations, under the direction of Special Agent in Charge Terence S. Opiola, with the investigation leading to today’s guilty plea.

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

Defense counsel:  Assistant Federal Public Defender Lisa Van Hoeck Esq., Trenton, New Jersey.

TRENTON, N.J. – An Ocean County, New Jersey, man today admitted owning and operating an unlicensed money transmitting business, U.S. Attorney Paul J. Fishman announced.

Yisroel Malamud, 53, of Lakewood, New Jersey, pleaded guilty before U.S. District Judge Anne E. Thompson in Trenton federal court to an information charging him with running an unlicensed money transmitting business.

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

Between January 2010 and May 2013, Malamud maintained a retail storefront in Lakewood under the name “Beepers Plus.” Malamud received money from members of the public, deposited the funds into bank accounts that he maintained in the name of different entities, and then transmitted the money from those bank accounts to third-parties within the United States in accordance with the customers’ instructions, charging the customers a fee for this service.

New Jersey law provides that the operation of an unlicensed money transmission business is punishable as a felony. Federal law requires anyone conducting such a business to register the business with the Secretary of the Treasury. Malamud did not possess and failed to obtain a money transmitting license, nor did he register with the Secretary of the Treasury.

The charge to which Malamud pleaded guilty carries a maximum potential penalty of five years in prison and a $250,000 fine. Sentencing is scheduled for June 1, 2017.

U.S. Attorney Fishman credited special agents of the FBI, Red Bank Resident Agency, under the direction of Special Agent in Charge Timothy Gallagher, with the investigation leading to today’s guilty plea.

The government is represented by Deputy Chief, Criminal Division Eric W. Moran of the U.S. Attorney’s Office in Newark.

Defense Counsel: Peter W. Till Esq., Springfield, New Jersey, and Stacy Ann Biancamano Esq., Chatham, New Jersey

NEWARK, N.J. – A native of Romania who was arrested in Spain and extradited to the United States was sentenced today to 57 months in prison for his role in a conspiracy to steal bank account information from thousands of customers by installing secret card-reading devices and pinhole cameras on ATMs throughout New Jersey, New York, Connecticut, Florida, and elsewhere, U.S. Attorney Paul J. Fishman announced. 

Alin Carabus, 43, previously pleaded guilty before U.S. District Judge William J. Martini to Count One of an indictment charging him with conspiracy to commit bank fraud. Judge Martini imposed the sentence today in Newark federal court.

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

Carabus admitted he was part of a vast “ATM skimming” scheme that stole bank account information by installing secret card-reading devices on ATMs throughout New Jersey, New York, Connecticut, Florida, and elsewhere. The scheme, which ultimately defrauded Citibank, TD Bank, Wells Fargo, and multiple other financial institutions out of at least $5 million and impacted thousands of customers, was organized by Marius Vintila, 34, also a native of Romania.

Vintila and Bogdan Radu, 34, designed and constructed sophisticated card-reader devices and pinhole camera panels capable of reading and storing customers’ bank account information and personal identification numbers. Carabus and others then secretly installed devices onto bank ATMs and removed them a few days later after they had recorded customer bank account information as customers performed routine bank transactions at ATMs.

The stolen data was used to create thousands of fraudulent ATM cards, which Carabus and others used to withdraw millions of dollars from customers’ bank accounts.   

In addition to the prison term, Judge Martini also sentenced Carabus to five years of supervised release and ordered to pay restitution and forfeiture of $5 million.

The ATM skimming operation in which Carabus participated is one of the largest ever uncovered by law enforcement. To date, 15 of the 16 individuals that have been charged in connection with this scheme, including Carabus, Vintila and Radu, have been convicted.

 U.S. Attorney Fishman credited special agents of the U.S. Secret Service, Newark Field Office, under the direction of Special Agent in Charge Mark McKevitt, and special agents of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), under the direction of Special Agent in Charge Terence S. Opiola in Newark, with the investigation leading to today’s sentencing.  

The government is represented by Assistant U.S. Attorneys Rahul Agarwal of the Special Prosecutions Division and David M. Eskew of the Criminal Division in Newark. 

Defense Counsel: Joseph M. Corazza Esq., Sparta, New Jersey

 

NEWARK, N.J. – Three people admitted today that they smuggled counterfeit electronics, including Apple iPhones, iPads and iPods, from China for sale in the United States, U.S. Attorney Paul Fishman of the District of New Jersey, Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Special Agent in Charge Terence Opiola of Homeland Security Investigations (HSI) in Newark, and Bergen County Prosecutor Gurbir Grewal announced.

Andreina Becerra, 31, a Venezuelan national, Roberto Volpe, 34, an Italian national, and Rosario La Marca, 54, an Italian national and resident of Naples, Italy, were originally charged in an eight-count indictment returned 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.   

The three defendants pleaded guilty before U.S. District Court Judge Kevin McNulty in Newark federal court to Count One of the indictment, charging conspiracy to traffic in counterfeit goods, to smuggle goods into the United States, and to structure financial transactions, and Count Two, charging trafficking in counterfeit goods.

As part of their plea agreements, Volpe and Becerra, who are husband and wife, agreed to forfeit their interest in 10 bank accounts, three Florida condominiums, and approximately $167,000 in cash. La Marca agreed to forfeit funds in a corporate bank account which represented proceeds of the charged offenses.    

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.   
 
    The conspiracy charge to which the defendants pleaded guilty in Count One carries a maximum potential penalty of five years in prison and a maximum fine of $250,000 or twice the gain or loss associated with the offense, whichever is greatest. The charge for trafficking in counterfeit goods to which the defendants pleaded guilty carries a maximum potential penalty of 10 years in prison and a maximum fine of $2 million. Sentencing for La Marca is scheduled for June 14, 2017. Sentencing for Volpe and Becerra is scheduled for Sept. 7, 2017.

Jianhua Li, a Chinese national currently residing in California, was charged in the original indictment, but 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 Senior Counsel Sarah Chang of the Criminal Division’s Computer Crime and Intellectual Property Section.

Three individuals pleaded guilty today for their roles in a scheme to smuggle into the United States counterfeit electronic devices, including those purporting to be genuine Apple iPhones, iPads and iPods, from China for sale in the United States.

Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, U.S. Attorney Paul Fishman of the District of New Jersey, Special Agent in Charge Terence Opiola of Homeland Security Investigations (HSI) in Newark and Bergen County Prosecutor Gurbir Grewal made the announcement. 

Andreina Becerra, 31, a U.S. citizen, Roberto Volpe, 34, an Italian national, and Rosario La Marca, 54, an Italian national and resident of Naples, Italy, each pleaded guilty before U.S. District Court Judge Kevin McNulty of the District of New Jersey to one count of conspiracy to traffic in counterfeit goods and labels, to smuggle goods into the United States, and to structure financial transactions, and one count of trafficking in counterfeit goods.  Becerra and Volpe will be sentenced on Sept. 7.  La Marca will be sentenced on June 14.

According to the documents filed in this case and statements made in court, from July 2009 through February 2014, the defendants conspired to smuggle and traffic into the United States from China more than 40,000 electronic devices and accessories, including digital cameras, iPads, iPhones, and iPods, along with labels and packaging bearing counterfeit Apple and Sony trademarks.  Defendants also wired or transferred more than 100 monetary instruments and funds totaling over $1.1 million in sales proceeds from U.S. accounts into accounts in China.  

Further, the documents filed in this case and statements made in court showed that defendants shipped devices separately from the labels bearing counterfeit trademarks for later assembly to avoid detection by U.S. Customs officials.  The devices were then shipped 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 and a portion of the proceeds was then transferred to conspirators in Italy, further disguising the source of the funds.  

Jianhua Li, also known as “Jeff Li,” a Chinese national currently residing in California, was charged as a co-defendant in an indictment filed on April 17, 2015, but 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 HSI Newark Seaport Investigations Group and the Bergen County Prosecutor’s Financial Crimes Unit investigated the case with significant assistance from Europol and Italy’s Guardia di Finanza.

Senior Counsel Sarah Chang of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorneys Leslie Schwartz and Sarah Devlin of the District of New Jersey are prosecuting the case.    

NEWARK, N.J. – A Newark man today admitted his involvement in an August 2015 home invasion that left one person dead, U.S. Attorney Paul J. Fishman announced.

Jahad Lemons, a/k/a “JBird,” 26, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to all four counts of 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.

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

On Aug. 18, 2015, Lemons, Aaron Terrell, a/k/a “Push,” 27, and Papayaw Mack, a/k/a “GY,” 25, as well as two other individuals – referred to in the indictment as “CC-1” and “CC-2” – 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.

At the residential building, 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 affects. During the course of the robbery, 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 and around Newark.

Under the terms of today’s plea agreement, Lemons will be sentenced to between 17 years and 22 years in prison and five years of supervised release. Sentencing is scheduled for June 12, 2017.

U.S. Attorney Fishman 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 Carolyn A. Murray, 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 against Terrell and Mack are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

Defense counsel: Kathleen M. Theurer Esq., Jersey City, New Jersey

CAMDEN, N.J. – A Deptford, New Jersey, man today admitted using a fake Facebook profile to entice children to produce sexually explicit images, U.S. Attorney Paul J. Fishman announced.

Michael J. Mostovlyan, 33, pleaded guilty before U.S. District Judge Renée Marie Bumb in Camden federal court to an information charging him with one count of online enticement of a minor to engage in criminal sexual conduct.

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

Mostovlyan admitted that, between Jan. 1, 2016 and June 2, 2016, he communicated with children online in order to obtain sexually explicit images of those children. Using a fake female persona on Facebook in the name of “Amber Zee,” which he created using actual images of a girl, Mostovlyan was able to persuade the victims to send him sexually explicit photographs or videos.

The count to which Mostovlyan pleaded guilty carries a mandatory minimum term of 10 years in prison, a potential maximum term of life imprisonment, and a $250,000 fine. Mostovlyan must also register as a sex offender. Sentencing is scheduled for June 1, 2017.

U.S. Attorney Fishman credited special agents of the FBI, under the direction Special Agent in Charge Michael Harpster in Philadelphia; the Monroe Township Police Department under the direction of Chief Michael E. Lloyd; the Gloucester County Prosecutor’s Office, under the direction of Prosecutor Sean F. Dalton; and the Deptford Township Police Department, under the direction of Chief William Hanstein, with the investigation leading to today’s plea.

The government is represented by Assistant U.S. Attorney Justin C. Danilewitz of the U.S. Attorney’s Office in Camden.

Defense counsel: Jonathan Kessous, Esq.

NEWARK, N.J. – A Pennsylvania man who operated a construction company that did work at construction projects at two military bases in New Jersey today admitted paying bribes and kickbacks to get the contracts, U.S. Attorney Paul J. Fishman announced.

George Grassie, 54, of Covington Township, Pennsylvania, pleaded guilty before U.S. District Judge Susan D. Wigenton in Newark federal court to an information charging him with one count of conspiracy to defraud the United States and commit bribery and one count of providing unlawful kickbacks.

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

Grassie owned a business that did construction, excavation and landscaping and did work as a subcontractor at Picattiny Arsenal (PICA) and Joint Base McGuire-Dix Lakehurst (Ft. Dix). He admitted that from December 2010 to December 2013, he paid bribes valued at $95,000 to $150,000 to an individual employed by the U.S. Army Contracting Command in New Jersey to obtain and retain subcontracts and other favorable assistance at PICA and Fort Dix. He also admitted that he paid kickbacks valued at $40,000 to $95,000 to Shawn Fuller and James Conway, who were then project managers for a prime contractor at PICA and Fort Dix.

Conway previously pleaded guilty to wire fraud and accepting unlawful kickbacks on August 2016. Fuller previously pleaded guilty to accepting unlawful kickbacks in November 2015.
 
The conspiracy charge to which Grassie pleaded guilty carries a maximum potential penalty of five years in prison. The charge for making unlawful kickbacks to which Grassie pleaded guilty carries a maximum potential penalty of 10 years in prison. Both charges carry a maximum fine of $250,000 or twice the gross gain or loss associated with the offense, whichever is greatest. Sentencing is scheduled for May 31, 2017.

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher; the U.S. Department of Defense, Defense Criminal Investigative Service, under the direction of Craig R.Rupert, Special Agent in Charge, DCIS Northeast Field Office; and the U.S. Army, Major Procurement Fraud Unit, Criminal Investigation Command, under the direction of Special Agent in Charge Larry Scott Moreland, with conducting the investigation leading to today’s guilty plea.  

The government is represented by Senior Litigation Counsel Leslie Faye Schwartz, of the United States Attorney’s Office’s Special Prosecutions Division and Assistant U.S. Attorney Barbara Llanes, Deputy Chief, General Crimes Unit, of the U.S. Attorney’s Office’s Criminal Division, in Newark.    

Defense counsel: Lawrence S. Lustberg Esq., Newark

CAMDEN, N.J. – A former New Jersey attorney and his father have been indicted for their respective roles in a $13 million Ponzi scheme, U.S. Attorney Paul J. Fishman announced today.

 

Michael W. Kwasnik, 47, of North Miami Beach, Florida, and William M. Kwasnik, 68, of Marlton, New Jersey, were indicted Feb. 16, 2017, by a federal grand jury on three counts of wire fraud, two counts of mail fraud, one count of conspiracy to commit money laundering, and seven counts of money laundering. Michael Kwasnik was also charged with eight additional counts of transacting in criminal proceeds. The defendants are both scheduled to appear Feb. 21, 2017, before U.S. Magistrate Judge Karen M. Williams in Camden federal court.

 

Michael Kwasnik previously owned and operated a law firm, Kwasnik, Rodio, Kanowitz and Buckley P.C. – and its successor firm, Kwasnik, Kanowitz and Associates P.C. – with offices in Cherry Hill, New Jersey, and Philadelphia, Pennsylvania. William Kwasnik owned and operated an insurance company, Abby Grant, in Lakewood and Cherry Hill, New Jersey.

 

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

 

From October 2008 to November 2011, Michael and William Kwasnik controlled a number of entities, including Liberty State Financial Holdings Corp. and its subsidiaries (Liberty State Benefits of Pennsylvania; Liberty State Benefits of Delaware; Liberty State Insurance Services; Liberty State Wealth Management; and Liberty State Credit) and Oxbridge Investors Fund; OPIS Management Fund; and Capital Management of Delaware.

 

The Kwasniks allegedly carried out a scheme to defraud clients of the Kwasnik law firm by diverting funds from their trust accounts to themselves and the entities they controlled. Michael Kwasnik and others induced clients to establish various types of trusts based on misrepresentations and false pretenses. Michael Kwasnik named himself as the clients’ trustee and directed clients to transfer their money, property and other assets into their trust accounts. Michael Kwasnik then transferred the money out of the clients’ trust accounts and into accounts which he and his father controlled. More than $13 million was collected from more than 40 clients over the three-year period. The Kwasniks laundered the funds through the entities they controlled and Abby Grant before ultimately using the stolen funds to pay for legal and operational expenses of the entities they controlled, the law firm, and personal expenses.

 

Each count of wire fraud, mail fraud and money laundering carries a maximum penalty of 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Each count of transacting in criminal proceeds carries a maximum penalty of 10 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense.

 

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Michael T. Harpster, Philadelphia Division, and special agents of IRS Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen, Newark Division, with the investigation leading to the indictment.

 

The government is represented by Assistant U.S. Attorney Sarah Wolfe of the U.S. Attorney’s Office in Trenton.

 

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

NEWARK, N.J. – The administrator of two criminal online hacking forums was sentenced today to 41 months in prison for stealing log-in and payment card data as part of an international hacking conspiracy, U.S. Attorney Paul J. Fishman announced.

Sergey Vovnenko, a/k/a “Sergey Vovnencko,” “Tomas Rimkis,” “Flycracker,” “Flyck,” “Fly,” “Centurion,” “MUXACC1,” “Stranier,” and “Darklife,” 31, most recently of Naples, Italy, previously pleaded guilty before the U.S. District Judge Esther Salas to Count One and Count Three of an indictment charging him with wire fraud conspiracy and aggravated identity theft. Judge Salas imposed the sentence today in Newark federal court.

Vovnenko was arrested on June 13, 2014, following an international investigation led by the U.S. Secret Service in coordination with Italian law enforcement. He had been detained by the Italian authorities pending the resolution of extradition proceedings, which he contested for more than 15 months.

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

From September 2010 through August 2012, Vovnenko and his conspirators operated an international criminal organization that hacked into the computers of individual users and companies located in the United States and elsewhere. They used that access to steal user names and passwords for bank accounts and other online services, as well as debit and credit card numbers and related personal identifying information.

Vovnenko admitted that, in order to steal this data, he operated a “botnet” – more than 13,000 computers infected with malicious computer software – programmed to gain unauthorized access to computers and to identify, store, and export information from hacked computers. A number of the infected computers were located in New Jersey. Vovnenko admitted using malware known as “Zeus” to steal banking information and record the keystrokes of the users of infected computers.

According to the indictment, Vovnenko was a high-level administrator of several online criminal forums and used his position to traffic in the data he stole as part of the conspiracy. These forums featured electronic bulletin boards, which members used to publicly communicate with all members and also send private messages directly to individual members.

The public and private discussions on these forums typically pertained to criminal activity, including the purchase, sale, and use of stolen log-in credentials and payment card data, as well as discussions related to cybercrime activity such as malicious computer hacking. For example, in August 2012, one of the forums offered various illicit products for sale, including access to compromised computer servers located in the United States. A price was listed for each product, and customers could click an “order” button and purchase the product using “credits” associated with their accounts.

In addition to the prison term, Judge Salas sentenced Vovnenko to three years of supervised release and ordered him to pay restitution of $83,368.

U.S. Attorney Fishman credited the special agents of the U.S. Secret Service, Criminal Investigations Division, under the direction of Director Joseph P. Clancy, and special agents from the Newark Field Office, under the direction of Special Agent in Charge Mark McKevitt, with the ongoing investigation leading to today’s sentencing.

He also thanked the Department of Justice’s Office of International Affairs in Washington and its attaché in Rome; The U.S. Embassy to Italy and the Republic of San Marino; and the Italian Ministry of Justice and Italian law enforcement officials for their extraordinary support.

The government is represented by Assistant U.S. Attorney Daniel Shapiro of the Computer Hacking and Intellectual Property Section of the U.S. Attorney’s Office Economic Crimes Unit.

Defense Counsel: Timothy Anderson Esq., Red Bank, New Jersey

NEWARK, N.J. – A Monmouth County doctor, his oncology practice, and his wife, who managed the practice, have agreed to pay the United States $1.7 million to resolve allegations that they illegally imported and used unapproved chemotherapy drugs from foreign distributors and illegally billed Medicare, U.S. Attorney Paul J. Fishman announced today.

 

“Illegally imported drugs avoid the FDA’s rigorous oversight and manufacturing standards,” U.S. Attorney Fishman said. “Health care providers who import those drugs are exposing their patients to serious risks of harm from contaminated or counterfeit products.”

 

“Patients receiving cancer treatment drugs should be assured that the medications meet FDA’s standards for safety and quality,” Jeffrey J. Ebersole, special agent in charge, FDA Office of Criminal Investigations’ New York Field Office, said. “OCI will continue its vigilance over the prescription drug supply chain to ensure that the drugs reaching patients comply with federal law, and that those who attempt to circumvent the agency’s oversight will be brought to justice.”

 

The settlement announced today resolves allegations that The Oncology Practice of Dr. Kenneth D. Nahum, Nahum himself, and his wife, Ann Walsh, of Colts Neck, New Jersey, ordered cancer drugs from a foreign distributor. From April 1, 2010, until January 31, 2011, Walsh allegedly ordered chemotherapy drugs from the foreign distributor for use at the practice, which was owned by Nahum and operated in Howell, New Jersey, and Wall, New Jersey. These drugs had not been approved by FDA for sale in the United States.

 

Doctors at the practice allegedly injected the drugs into their patients, and the practice then submitted claims to Medicare for reimbursement for the drugs and infusion services. Since Medicare will only reimburse for drugs that have been approved for use in the United States, the practice allegedly violated the federal False Claims Act.

 

U.S. Attorney Fishman credited special agents of the FDA’s Office of Criminal Investigation, under the direction of Special Agent in Charge Ebersole, and special agents of the U.S. Department of Health and Human Services – Office of the Inspector General, under the direction of Special Agent in Charge Scott J. Lampert, with the investigation leading to today’s settlement.

 

The government is represented by Assistant U.S. Attorneys Sarah Wolfe of the U.S. Attorney’s Office in Trenton, and Andrew A. Caffrey III and Charles Graybow of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark.

 

U.S. Attorney Paul J. Fishman reorganized the health care fraud practice shortly after taking office, including creating 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 $1.32 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.

 

The claims settled by this agreement are allegations only, and there has been no determination of liability.

 

Defense counsel:

The Oncology Practice and Nahum: Michael B. Himmel Esq. and Matthew M. Oliver Esq., Roseland, New Jersey

Walsh: Salvatore T. Alfano Esq., Bloomfield, New Jersey

NEWARK, N.J. – A plastic surgeon with a practice in Basking Ridge, New Jersey, was sentenced today to 36 months in prison for fraudulently diverting millions in corporate earnings for his personal use, costing the United States nearly $3 million in tax revenue between 2006 and 2010, U.S Attorney Paul Fishman announced.

David Evdokimow, 56, of Harding Township, New Jersey, was previously convicted of all eight counts of a superseding indictment charging him with one count of conspiring to defraud the United States, four counts of personal income tax evasion and three counts of corporate tax evasion. He was convicted following three-week trial before U.S. District Judge Noel L. Hillman, who imposed the sentence today in Camden federal court.

According to the superseding indictment and evidence at trial:

Evdokimow ran his medical practice through a corporation called De’Omilia Plastic Surgery P.C. (De’Omilia). He conspired with others to conceal millions of dollars of taxable income from the IRS by forming shell corporations and then having trusted associates open bank accounts for those corporations. Evdokimow then convinced these associates to give him their signatures or signature stamps so that he had full access to the shell company bank accounts while at the same time being able to conceal his connection to those accounts. He and the other conspirators then funneled millions of dollars in De’Omilia income into the bank accounts of the shell corporations and falsely claimed that these transfers were legitimate business expenses. Evdokimow also used bank accounts in the name of De’Omilia to pay his personal expenses, and falsely claimed those were business expenses too.

Evdokimow used the shell corporation and De’Omilia bank accounts to pay for more than $5.8 million in personal expenses, including designer apparel, jewelry, vacations, artwork, and multiple residences, all of which he falsely claimed as business expenses.

Evdokimow also opened accounts at several banks in order to cash checks received directly from patients for professional medical services. Between 2009 and 2011, Evdokimow cashed more than $360,000 in checks from patients, which he failed to report on his federal income tax returns.

Evdokimow was convicted of concealing more than $5.8 million in income from tax years 2006 to 2010. By concealing this income, Evdokimow evaded paying almost $3 million in taxes during that period.

In addition to the prison term, Judge Hillman sentenced Evdokimow to one year of supervised release and fined $96,000. He previously paid the taxes owed.

U.S. Attorney Fishman credited 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 Assistant U.S. Attorneys Paul Murphy and Justin Herring of the U.S. Attorney’s Office Criminal Division in Newark.

Defense counsel: James Kridel Esq., Clifton, New Jersey

NEWARK, N.J. - An airline passenger today admitted assaulting a female passenger who did not know him aboard a flight from Los Angeles International Airport to Newark Liberty International Airport on July 30, 2016, U.S. Attorney Paul J. Fishman announced.

 

Veerabhadrarao Kunam, 58, of Visakhapatnam, India, pleaded guilty before U.S. Magistrate Judge Joseph A. Dickson in Newark federal court to an information charging him with assault in the special aircraft jurisdiction of the United States.

 

According to documents filed in this case and statements made in court, Kunam was seated next to a woman who occupied a middle seat on a Virgin America redeye flight from Los Angeles to Newark on July 29 and 30, 2016. While the plane was in the air, the woman fell asleep. Kunam admitted that while the victim was asleep, he touched her vagina and buttocks without her consent.

 

Kunam was arrested on July 30, 2016 – the day his flight arrived in Newark – and was taken into federal custody by the FBI.

 

The federal government has exclusive jurisdiction over all sexual abuse cases that occur on aircraft in flight in the United States.

 

Under the terms of today’s plea agreement, Kunam will be sentenced to between 30 and 60 days in prison and up to 90 days in an inpatient alcohol treatment center. Sentencing is scheduled for March 22, 2017.

 

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher, and the Port Authority Police Department, under the direction of Superintendent Michael A. Fedorko, with the investigation.

 

The government is represented by Francisco J. Navarro of the U.S. Attorney’s Office Criminal Division in Newark.

 

Defense counsel: Alexander Spiro, New York, New York

A Florida man was sentenced for his role in a computer hacking and identity theft scheme that hijacked customer email accounts to send bulk unsolicited or “spam” emails and generated more than $1.3 million in illegal profits, announced Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division and U.S. Attorney Paul J. Fishman of the District of New Jersey.

Timothy Livingston, 31, of Boca Raton, Florida, was sentenced Tuesday to serve 48 months in prison before U.S. District Judge William J. Martini of the District of New Jersey.  Livingston previously pleaded guilty to one count each of conspiracy to commit fraud in connection with computers and access devices, conspiracy to commit fraud in connection with electronic mail and aggravated identity theft.  

According to admissions made in connection with his plea agreement, beginning as early as 2011, Livingston operated A Whole Lot of Nothing LLC – a business that specialized in sending spam emails on behalf of its clients.  Livingston’s clients included legitimate businesses, such as insurance companies that wished to send bulk emails to advertise their businesses, as well as illegal entities, such as online pharmacies that sold narcotics without prescriptions.

As part of his plea, Livingston admitted that beginning in January 2012, he solicited Tomasz Chmielarz to write computer programs that would send spam in a manner that concealed the true origin of the email and bypassed filters.  Livingston also used proxy servers and botnets to remain anonymous and evade spam blocking techniques.  Livingston further admitted that he hacked into individual email accounts and utilized corporate mail servers to further his spam campaigns, which enabled him to send out massive amounts of spam without identifying himself as the sender.

The FBI’s Cyber Division investigated the case.  Senior Trial Attorney William Hall Jr. of the Computer Crime and Intellectual Property Section, Assistant U.S. Attorney Daniel Shapiro of the District of New Jersey’s Computer Hacking and Intellectual Property Section of the Economic Crimes Unit, and Assistant U.S. Attorney Sarah Devlin of the Asset Forfeiture-Money Laundering Unit prosecuted the case.

NEWARK, N.J. – A Boca Raton, Florida man was sentenced to 48 months in prison for his role in a computer hacking and identity theft scheme that hijacked customer email accounts to send bulk unsolicited or “spam” emails and generated more than $1.3 million in illegal profits, New Jersey U.S. Attorney Paul J. Fishman and Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division announced today.

Timothy Livingston, 31, previously pleaded guilty before U.S. District Judge William J. Martini to one count each of conspiracy to commit fraud in connection with computers and access devices, conspiracy to commit fraud in connection with electronic mail, and aggravated identity theft. Judge Martini imposed the sentence Feb. 14, 2017 in Newark federal court.

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

Beginning as early as 2011, Livingston operated A Whole Lot of Nothing LLC – a business that specialized in sending spam emails on behalf of its clients. Livingston’s clients included legitimate businesses, such as insurance companies that wished to send bulk emails to advertise their businesses, as well as illegal entities, such as online pharmacies that sold narcotics without prescriptions.

Beginning in January 2012, Livingston solicited Tomasz Chmielarz, 34, of Rutherford, New Jersey, to write computer programs that would send spam in a manner that concealed the true origin of the email and bypassed filters. Livingston also used proxy servers and botnets to remain anonymous and evade spam blocking techniques.

Livingston hacked into individual email accounts and utilized corporate mail servers to further his spam campaigns. For instance, Livingston and Chmielarz created custom software designed to hack into the customer email accounts of a company identified in the indictment as “Corporate Victim 1” so that those accounts could then be used to send out spam. By using proxy servers and Corporate Victim 1’s customer accounts, Livingston was able to send out massive amounts of spam without identifying himself as the sender.

Livingston and Chmielarz also created custom software that appropriated a corporate website, identified in the indictment as “Corporate Victim 2,” which allowed Livingston to use Corporate Victim 2’s servers to send spam that appeared to be from Corporate Victim 2, but in reality was transmitted by Livingston.

In addition to the prison term, Judge Martini sentenced Livingston to three years of supervised release.

U.S. Attorney Fishman and Acting Assistant Attorney General Blanco credited special agents of the FBI’s Cyber Division, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation.

The government is represented by Assistant U.S. Attorney Daniel Shapiro of the Computer Hacking and Intellectual Property Section of the Economic Crimes Unit in Newark, Senior Trial Attorney William Hall of the Department of Justice’s Criminal Division Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Sarah Devlin of the Asset Forfeiture-Money Laundering Unit in Newark.

Defense counsel: Lorraine Gauli-Rufo Esq., Verona, New Jersey

NEWARK, N.J. – A former Amtrak supervisor today admitted fraudulently overbilling Amtrak overtime and regular hours that he claimed to be working when he was actually not present at Amtrak work sites, U.S. Attorney Paul J. Fishman announced.

Richard Vogel, 64, of Edison, New Jersey, pleaded guilty before U.S. Magistrate Judge Joseph A. Dickson in Newark federal court to an information charging him with converting to his own use federal government funds.

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

Vogel, who had been employed by Amtrak since January 1977 until he retired in July 2016, supervised approximately 35 employees in work gangs on the Construction Signals side of the Communications and Signals Department, New York Division. Between November 2015 and June 2016, Vogel fraudulently billed Amtrak for 41 regular hours and 685.75 overtime hours when he was not actually present at Amtrak work sites, resulting in a loss to Amtrak of more than $71,000.

The count to which Vogel pleaded guilty carries a maximum potential penalty of one year in prison and fines of up to $250,000, or twice the gain or loss resulting from the offense, whichever is greater. Sentencing is scheduled for May 22, 2017. The plea agreement requires Vogel to make full restitution for losses related to his conduct in the amount of $71,946.

U.S. Attorney Fishman credited Amtrak’s Office of Inspector General, Office of Investigations, Philadelphia office, with the investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorney Mala Ahuja Harker of the U.S. Attorney’s Office Special Prosecutions Division.

NEWARK, N.J. - A Nevada man was sentenced today to 78 months in prison for defrauding investors out of more than $5 million, U.S. Attorney Paul J. Fishman announced.

Lee Vaccaro, 45, of Las Vegas, Nevada, previously pleaded guilty before U.S. District Judge William J. Martini to an information charging him with one count of conspiracy to commit securities fraud and one substantive count of securities fraud. Judge Martini imposed the sentence today in Newark federal court.

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

Vaccaro was the chief marketing officer and vice president of investor relations for eAgency, a California-based company developing mobile security products. Vaccaro admitted that he and an individual identified as “Conspirator #1” sold investors interests in companies they controlled, and falsely represented to investors that the companies held warrants in eAgency. Warrants are derivative securities that give the holder the right to purchase common stock at a specific price within a certain time frame.

Vaccaro also admitted that he and Conspirator #1 made oral and written misrepresentations concerning the existence, number, validity, and term of eAgency warrants purportedly owned by the investment companies, as well as about the amount of money Conspirator #1 had personally invested in and raised for eAgency, and Conspirator #1’s current position at eAgency.

In addition, Vaccaro admitted that he and Conspirator #1 created and showed to investors numerous forged documents purporting to reflect the issuance of warrants to entities controlled by Vaccaro, and the transfer of those warrants to a company controlled by Conspirator #1. He admitted that most of the eAgency warrants purportedly transferred by Vaccaro to Conspirator #1’s company had, in fact, never been issued.

Beginning in January 2011, the dollar amount of interests Vaccaro and Conspirator #1 sold in the investment companies began to surpass the dollar amount of valid warrants held by the investment companies. Neither Vaccaro nor Conspirator #1 disclosed to investors the risk that their investments would be diluted by the sale of additional interests in the companies.

Vaccaro and Conspirator #1’s actions defrauded investors of more than $5 million.

In addition to the prison term, Judge Martini ordered Vaccaro to serve three years of supervised release.

U.S. Attorney Fishman 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. Securities and Exchange Commission’s New York Regional Office, under the direction of Sanjay Wadhwa and the New Jersey Bureau of Securities, under the direction of Acting Chief Amy G. Kopleton, for their assistance.

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

If you believe you are a victim of or otherwise have information concerning this alleged scheme, you are encouraged to contact the FBI at 973-792-3000.

Today’s sentencing is due to efforts by the Financial Fraud Enforcement Task Force, which 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.

Defense counsel: Robert C. Scrivo, Esq., Newark

NEWARK, N.J. – A Carteret, New Jersey, man was sentenced today to 96 months in prison for conspiring to traffic approximately four kilograms of ethylone from China to New Jersey, U.S. Attorney Paul J. Fishman announced.

Thomas Seymore, 38, previously pleaded guilty before U.S. District Court Judge Katharine S. Hayden to an indictment charging him with one count of conspiring to distribute ethylone, a Schedule I controlled substance. Judge Hayden imposed the sentence today in Newark federal court.

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

On June 10, 2014, Seymore conspired with Michael Correa, 33, of Rahway, New Jersey, to distribute approximately four kilograms of ethylone, which had been ordered from China and shipped to a location in Teaneck, New Jersey. Ethylone, sometimes referred to as “bath salts” and “molly,” is an illegal synthetic drug that stimulates the central nervous system and can cause hallucinogenic effects.

In addition to the prison term, Judge Hayden sentenced Seymore to three years of supervised release. Correa previously pleaded guilty to his role and was sentenced Dec. 20, 2016 to 57 months in prison.

U.S. Attorney Fishman credited special agents and task force officers of the Drug Enforcement Administration (DEA), under the direction of Special Agent in Charge Carl J. Kotowski; the U.S. Department of Homeland Security-Homeland Security Investigations under the direction of Special Agent in Charge Terence S. Opiola, and the U.S. Postal Inspection Service under the direction of Inspector in Charge James V. Buthorn.

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

Defense Counsel: Susan C. Cassell Esq., Ridgewood, New Jersey

NEWARK, N.J. – A human resources manager for two information technology companies today admitted that she obstructed a federal investigation as part of a scheme to fraudulently obtain foreign worker visas, U.S. Attorney Paul J. Fishman announced.     

Hiral Patel, 34, of Jersey City, New Jersey, pleaded guilty before U.S. District Judge Kevin McNulty in Newark federal court to an information charging her with conspiracy to obstruct justice.

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

SCM Data Inc. and MMC Systems Inc. offered consultants to clients in need of IT support. Both companies recruited foreign nationals, often student visa holders or recent college graduates, and sponsored them for H-1B visas. The H-1B program allows businesses in the United States to temporarily employ foreign workers with specialized or technical expertise in a particular field, such as accounting, engineering or computer science. 

Patel’s conspirators recruited foreign workers with purported IT expertise who sought work in the United States. The conspirators then sponsored the foreign workers’ H-1B visas with the stated purpose of working for SCM Data and MMC Systems’ clients throughout the United States. When submitting the visa paperwork to the U.S. Department of Homeland Security, U.S. Citizenship and Immigrations Services (USCIS), the conspirators represented that the foreign workers had full-time positions and were paid an annual salary, as required to secure the visas.

Contrary to these representations and in violation of the H-1B program, the conspirators paid the foreign workers only when they were placed at a third-party client who entered into a contract with SCM Data or MMC Systems. The conspirators told the foreign workers who were not currently working that if they wanted to maintain their H-1B visa status, they would need to come up with what their gross wages would be in cash and give it to SCM Data and MMC Systems so the companies could issue payroll checks to the foreign workers. 

The conspirators then encouraged the foreign workers to submit the bogus payroll checks to USCIS as proof that the workers were engaged in full-time work despite the fact that they were not working for the companies. Once the U.S. Department of Labor (USDOL) launched an audit of SCM Data and MMC Systems, the conspirators fabricated leave or vacation slips to USDOL for the time periods that the foreign workers were not working to conceal the fact that they were not paid during those time periods as required by federal law.

Patel – who was a human resources manager for SCM Data and MMC Systems – admitted that in February 2015 and March 2015, in response to a USDOL audit, she was involved in preparing false leave slips for the foreign workers on behalf of SCM Data and MMC Systems.

Patel faces a maximum potential penalty of five years in prison and a $250,000 fine.  Sentencing is scheduled for June 1, 2017.   

U.S. Attorney Fishman praised special agents of the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), under the direction of Special Agent in Charge Terence Opiola, and the U.S. Department of Labor, Office of Inspector General, under the direction of Special Agent in Charge Michael Mikulka, with the investigation.
    
The government is represented by Assistant U.S. Attorney Joyce M. Malliet of the U.S. Attorney’s Office’s National Security Unit in Newark.

Defense Counsel:  Michael V. Gilberti, Esq.

NEWARK, N.J. – A crack-cocaine wholesaler for the New Jersey set of the Grape Street Crips today admitted his involvement in racketeering and drug trafficking conspiracies operating in Newark, New Jersey, U.S. Attorney Paul J. Fishman announced.

James S. Gutierrez, a/k/a “Bad News,” 26, of Newark, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to Count 1 and Count 18 of a sixth superseding indictment charging him with racketeering conspiracy and conspiracy to distribute crack-cocaine.

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

The New Jersey Grape Street Crips controlled drug trafficking and other criminal activities in various areas of Newark. Gutierrez and other members of the gang accepted orders for, and distributed, thousands of clips of crack-cocaine to other distributors, including other gang members.

To protect their gang and drug territory, the New Jersey Grape Street Crips operating in the area of 6th Avenue and North 5th Street in Newark used “community guns” that were easily accessible to gang members. During the course of the investigation, law enforcement agents seized numerous firearms, including a .410 caliber assault rifle, a.45 caliber Thompson semi-automatic carbine, a 7.62 caliber assault rifle, and numerous semi-automatic handguns.

Under the terms of today’s plea agreement, Gutierrez will be sentenced to between 10 years and 14 years in prison and five years of supervised release. Sentencing is scheduled for May 22, 2017.

U.S. Attorney Fishman credited special agents of the DEA, under the direction of Special Agent in Charge Carl J. Kotowski in Newark, and special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation. He also thanked prosecutors and detectives of the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Carolyn A. Murray; 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 assistance in this case.

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.

Defense counsel: Edward J. Plaza Esq., Little Silver, New Jersey

TRENTON, N.J. – A former resident of Old Tappan, New Jersey, today admitted evading personal income taxes on more than $400,000 in income in 2013, U.S. Attorney Paul J. Fishman announced.

William Dominick, 68, of Collier County, Florida, pleaded guilty before U.S. District Judge Anne E. Thompson in Trenton federal court to an information charging him with one count of tax evasion and one count of identity theft.

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

Dominick owned and operated Westwood Rare Coin out of his home in Old Tappan. He was required to include income earned by Westwood Rare Coin on his individual IRS 1040 form. During calendar year 2013, Dominick failed to report $400,000 in income earned by Westwood Rare Coin. He did this by using other people’s identities to open credit cards to purchase bulk quantities coins from the U.S. Mint in order to corner the market. Dominick then sold those coins through his business, retained the proceeds for his personal use, and failed to include the proceeds on the tax return that he signed and filed with the IRS.

The count of identity theft to which Dominick pleaded guilty carries a maximum potential penalty of 15 years in prison; the count of tax evasion carries a maximum potential penalty of five years in prison; both counts also carry a fine of up to $250,000. Sentencing is scheduled for May 23, 2017.

Under terms of his plea agreement, Dominick will file amended returns and make full restitution for years 2010 through 2014.

U.S. Attorney Fishman credited special agents of the FBI, under the direction of special agent in charge Timothy Gallagher; special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen; and inspectors of the U.S. Postal Inspection Service, under the direction of Postal Inspector in Charge James V. Buthorn, with the investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorney Shana Chen of the Economic Crimes Unit in Newark.

Defense counsel: John Whipple Esq., Morristown, New Jersey

CAMDEN, N.J. – Two Camden-area men were charged by a federal grand jury today in connection with their roles in a drug distribution organization, U.S. Attorney Paul J. Fishman announced.

Preston J. Thomas, 30, a/k/a “Boo,” of Camden, was charged in a superseding indictment with one count of conspiracy to distribute and to possess with intent to distribute cocaine base and one count of possession of a firearm in furtherance of a drug trafficking crime. The superseding indictment also charged Jeffrey Whitaker, 33, a/k/a “Jay,” a/k/a “Jay Black,” and a/k/a “Black,” of Collingswood, with the same drug trafficking conspiracy offense.

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

Thomas, Whitaker 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.

Two conspirators identified in the indictment have already pleaded guilty to drug conspiracy and firearm offenses.

On Jan. 17, 2017, Jason Boyd, 36, a/k/a “Teddy,” a/k/a “Teddy Reek,” and a/k/a “Fatboy,” pleaded guilty before U.S. District Judge Jerome B. Simandle in Camden federal court to an information charging him with one count of conspiracy to distribute and to possess with intent to distribute cocaine base and one count of possession of a firearm in furtherance of a drug trafficking crime. Boyd’s sentencing is scheduled for April 28, 2017.

On Dec. 8, 2016, Derek Stallworth, 20, a/k/a “AK” and a/k/a “A,” of Camden, also pleaded guilty before Judge Simandle to the same charges. His sentencing is scheduled for March 24, 2017.

The drug distribution conspiracy charge carries a maximum potential penalty of 20 years in prison and a $1 million fine. The firearms charge carries a mandatory minimum sentence of five years in prison to be served consecutively to the sentence for the conspiracy charge.

U.S. Attorney Fishman 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 indictment.

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.

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

Defense counsel:

Thomas: Maggie Moy Esq., Assistant Federal Public Defender, Camden

Whitaker: Mark Catanzaro Esq., Mt. Holly, New Jersey

CAMDEN, N.J. – A Willingboro, New Jersey, man was sentenced today to 96 months in prison for his role in a conspiracy to rob a drug stash house of multiple kilograms of cocaine that he believed would be stored at the location, U.S. Attorney Paul J. Fishman announced.

Sean Forman, a/k/a “C-Life,” 43, previously pleaded guilty before U.S. District Judge Noel L. Hillman to a two-count superseding information charging him with conspiracy to commit robbery and conspiracy to distribute cocaine. Judge Hillman imposed the sentence today in Camden federal court.

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

In January 2014, Forman, Robert Smith, 43, of Trenton, Derrick Adams, 30, of Florence and Willingboro, New Jersey, and Daquon Basnight, 25, Jamiil McFarlane, 24, and Morris Muse, 36, all of Trenton, planned a gunpoint robbery of a drug stash house in order to steal kilograms of cocaine from dealers at the location. During an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Smith was recorded – in the presence of Forman – discussing his willingness, if necessary, to kill the occupants of the stash house. Smith and Adams, in text message conversations and recorded communications, discussed their plan to rob the stash house while posing as law enforcement.

ATF special agents arrested the conspirators when they arrived at a meeting location in Maple Shade, New Jersey, on Jan. 30, 2014. After searching the conspirators and their vehicles, the agents recovered five firearms – including a sawed-off shotgun and two stolen handguns – as well as numerous rounds of ammunition, a ballistics vest, masks, gloves, and zip ties.

In addition to the prison terms, Judge Hillman ordered Forman to serve five years of supervised release.

Basnight, McFarlane, Muse, and Adams all previously pleaded guilty to their roles and have been sentenced to prison. Smith was convicted at trial and sentenced to 360 months in prison in November 2016.

U.S. Attorney Fishman credited special agents with the ATF Camden Field Office, under the direction of Acting Special Agent in Charge Scott C. Curley in Newark, with the investigation leading to today’s sentence. He also thanked the Drug Enforcement Administration (DEA) Maple Shade Field Office, as well as the Burlington City and Burlington Township police departments, for their assistance in this case.

The government is represented by Assistant U.S. Attorneys Justin C. Danilewitz and Howard Wiener of the U.S. Attorney’s Office Criminal Division in Camden.

Defense counsel: Brian O’Malley Esq.

ALBUQUERQUE – During a hearing yesterday, a U.S. Magistrate Judge sitting in Albuquerque, N.M., found probable cause to support a criminal complaint charging Michael Gerard Smith, 55, of Albuquerque, with violating the federal narcotics and firearms laws. Today, the Magistrate Judge entered an order holding Smith in federal custody pending trial based on judicial findings that he poses a risk of flight and danger to the community. The federal charges against Smith were announced by U.S. Attorney Damon P. Martinez, Special Agent in Charge Will R. Glaspy of DEA’s El Paso Division, and Chief Gorden G. Eden, Jr., of the Albuquerque Police Department (APD).

 

Smith, whose criminal history includes 11 prior felony convictions for drug trafficking, robbery, false imprisonment and forgery offenses, is being prosecuted under the federal anti-violence initiative that targets “the worst of the worst” offenders for federal prosecution. Under this initiative, the U.S. Attorney’s Office and federal law enforcement agencies work with New Mexico’s District Attorneys and state, local and tribal law enforcement agencies to target violent or repeat offenders primarily based on their prior criminal convictions for federal prosecution with the goal of removing repeat offenders from communities in New Mexico for as long as possible. Because New Mexico’s violent crime rate, on a per capita basis, is one of the highest in the nation, New Mexico’s law enforcement community is collaborating to target repeat offenders from counties with the highest violent crime rates.

 

Smith was arrested on Feb. 3, 2017, and charged by criminal complaint with methamphetamine and heroin trafficking offenses, and being a felon in possession of a firearm. According to the criminal complaint, APD officers allegedly seized approximately 94.5 grams of methamphetamine, 34.9 grams of heroin, a handgun, and cash in denominations consistent with street level drug trafficking while executing a search warrant at Smith’s residence.

 

If convicted, Smith faces a statutory mandatory minimum penalty of ten years and a maximum of life in prison on the drug trafficking charges, and a maximum of ten years in in prison for being a felon in possession of a firearm. If deemed an armed career criminal, Smith faces an enhanced penalty of not less than 15 years in prison for unlawfully possessing a firearm, and the potential of a life sentence on the drug trafficking charges if the United States files a prior felony information.

 

Charges in criminal complaints are merely accusations and defendants are presumed innocent unless found guilty in a court of law.

 

The case against Smith was investigated by the Albuquerque office of the DEA and the APD, and is being prosecuted by Assistant U.S. Attorney Norman Cairns as part of the New Mexico Heroin and Opioid Prevention and Education (HOPE) Initiative. The HOPE Initiative was launched in January 2015 by the UNM Health Sciences Center and the U.S. Attorney’s Office in response to the national opioid epidemic, which has had a disproportionately devastating impact on New Mexico. Opioid addiction has taken a toll on public safety, public health and the economic viability of our communities. Working in partnership with the DEA, the Bernalillo County Opioid Accountability Initiative, Healing Addiction in our Community (HAC), the Albuquerque Public Schools and other community stakeholders, HOPE’s principal goals are to protect our communities from the dangers associated with heroin and opioid painkillers and reducing the number of opioid-related deaths in New Mexico.

 

The HOPE Initiative is comprised of five components: (1) prevention and education; (2) treatment; (3) law enforcement; (4) reentry; and (5) strategic planning. HOPE’s law enforcement component is led by the Organized Crime Section of the U.S. Attorney’s Office and the DEA in conjunction with their federal, state, local and tribal law enforcement partners. Targeting members of major heroin and opioid trafficking organizations for investigation and prosecution is a priority of the HOPE Initiative. Learn more about the New Mexico HOPE Initiative at http://www.HopeInitiativeNM.org.

TRENTON, N.J. – A Monmouth County, New Jersey, man today admitted downloading sexually explicit videos and images of children to his home computer, U.S. Attorney Paul J. Fishman announced.

James Paroline, 27, of Red Bank, New Jersey, pleaded guilty before U.S. District Judge Freda L. Wolfson in Trenton federal court to Count One of an indictment charging him with receiving child pornography.

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

Paroline was employed in Monmouth County as an assistant at a nursery school and as a summer camp counselor at a private school. Between Feb. 26, 2015, and March 2, 2015, Paroline accessed a website known as “PlayPen,” an underground online bulletin board and website dedicated to the advertisement and distribution of child pornography. During that period, Paroline logged into PlayPen under the username “jimbobtropolis,” which he had registered with PlayPen using his personal email address, and downloaded multiple videos and images depicting the sexual abuse of children from the website.

The count to which Paroline pleaded guilty carries a mandatory minimum term of five years in prison, a statutory maximum of 20 years in prison, and a $250,000 fine. Sentencing is scheduled for June 1, 2017.

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation leading to today’s guilty plea. He also thanked officers of the Red Bank Police Department, under the direction of Chief of Police Darren McConnell; officers of the Middletown Police Department, under the direction of Chief Craig Weber; and detectives of the Monmouth County Prosecutor’s Office, under the direction of Prosecutor Christopher J. Gramiccioni; for their assistance.

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

NEWARK – A Warren County, New Jersey, tax preparer was arrested this morning and charged with allegedly filing false returns on behalf of his clients and misappropriating clients’ funds, U.S. Attorney Paul J. Fishman announced.

Brian Allen Day, 54, of Port Murray, New Jersey, was indicted by a federal grand jury on four counts of aiding and assisting in the filing of false individual income tax returns for clients and four counts of defrauding banks by misappropriating clients’ funds based on misrepresentations about their purported tax payments owed to the IRS and by altering checks they paid to him for the purported tax liabilities and depositing the checks in his business bank accounts. He will appear this afternoon before U.S. Magistrate Judge Mark Falk in Newark federal court.

According to the indictment:

Day is self-employed as a tax preparer and has various tax preparation businesses in New Jersey, such as PTS, Tax Consultants, and Tax Consultants LLC. For the tax years 2013 to 2015, Day prepared false individual income tax returns for various clients by fabricating and inflating expenses and deductions on Schedule A or supplemental loss deductions on Schedule E of their Form 1040s in order to obtain refunds in amounts greater than those to which they were entitled. The total amount of false deductions and expenses charged in the indictment is $383,773.

Additionally, from December 2011 through April 2015, Day misappropriated some of his taxpayer clients’ monies by falsely advising them that they owed certain tax payments to the IRS; directing his clients to give him checks made payable to the IRS to resolve these purported liabilities with the IRS; altering the checks made payable to the IRS to make them appear to be payable to Day’s tax preparation businesses; and then depositing the checks into his business bank accounts without making any payment to the IRS on behalf of the clients. By doing so, Day defrauded the financial institutions from which these checks were drawn. Day presented his clients with fraudulent documents purportedly issued by the IRS falsely stating that it had received payments for the purported liabilities. Day misappropriated $61,000 from his clients.

Each count of aiding and assisting in the filing of false tax returns carries a maximum potential penalty of three years in prison and a fine of $250,000 or twice the gross pecuniary gain or loss from the fraud. The bank fraud charges each carry a maximum potential penalty of 30 years in prison and a fine of $1 million.

U.S. Attorney Fishman credited special agents of the IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen; and special agents of the U.S. Treasury Inspector General for Tax Administration (TIGTA) under the direction of Rodney A. Davis, with the investigation leading to the indictment.

The government is represented by Assistant U.S. Attorney Jihee G. Suh of the General Crimes Unit in Newark.

Anyone who believes they may have been a victim of this defendant can contact IRS-Criminal Investigation at (732) 761-6439.

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

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

NEWARK, N.J. – A Paramus, New Jersey, man was sentenced today to one year of probation for helping funnel $80,000 in campaign contributions from a foreign source to the joint fundraising committee of the President of the United States during the 2012 presidential election, U.S. Attorney Paul J. Fishman announced.

Bilal Shehu, 48, previously pleaded guilty before U.S. District Judge Madeline Cox Arleo to an information charging him with knowingly and willfully making foreign contributions and donations in connection with the 2012 presidential election and to a fundraising and political campaign committee of the president, aggregating $25,000 or more during a calendar year. Judge Arleo imposed the sentence today in Newark federal court.

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

In September 2012, Shehu, a U.S. citizen living in New Jersey, received approximately $80,000 from a foreign source and provided it to a joint fundraising committee – including the authorized campaign committee of the president – to disguise the true origin of the money and so that a foreign national could attend a campaign event on Oct. 8, 2012, in San Francisco.

Federal law prohibits foreign nationals from making contributions to federal candidates or fundraising committees and, in order to attend the event, a foreign national needed to be accompanied by a U.S. citizen.

Shehu admitted that he received the $80,000 wire transfer into his New Jersey-based bank account from a foreign bank account in late September 2012, knowing that he was to provide it to the joint fundraising committee. In early October 2012, Shehu flew to San Francisco and attempted to gain entry into the San Francisco fundraising event with the foreign national, who was denied entry but was allowed to be photographed with the President.

No one on the joint fundraising committee has been accused of any wrongdoing and the committee has fully cooperated in the investigation leading to today’s sentencing.

William Argeros, 58, of Tampa, Florida, was also charged in this scheme and pleaded guilty on July 25, 2016. His sentencing is scheduled for Feb. 14, 2017.

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

The government is represented by Assistant U.S. Attorney Mark J. McCarren of the District of New Jersey’s Special Prosecutions Division and Trial Attorneys Charles Walsh and Peter Halpern of the Criminal Division’s Public Integrity Section.

Defense counsel: Alan M. Abramson Esq., New York

CAMDEN, N.J. – An Atlantic County man who was previously sentenced in 2007 in connection with a scheme to defraud women over telephone dating services and in 2015 for violating the conditions of his federal supervised release admitted today to traveling in order to launder money in connection with a similar scheme, U.S. Attorney Paul J. Fishman announced.

Patrick Giblin, 52, formerly of Ventnor, New Jersey, pleaded guilty before U.S. District Judge Robert B. Kugler in Camden federal court to an information charging him with one count of interstate travel and use of a facility in interstate and foreign commerce with the intent to launder money.

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

From January 2013 to Dec. 16, 2014, Giblin allegedly posted advertisements and messages on telephone dating services throughout the United States. Giblin cultivated a telephone rapport with the women he spoke to on these services, falsely claimed that he would be relocating or travelling to the woman’s geographic area, and falsely represented that he wished to pursue a committed, romantic relationship with each woman. He then lied to the women about needing a loan, which he never intended to repay, for relocation or travel expenses. Giblin received money from the women he spoke to on the dating services via interstate wire services such as Western Union and MoneyGram. Giblin also directed women to transfer money through one of these services onto a payroll/debit card that he used. Giblin used some of his victims’ money in order to purchase airtime minutes for cellular telephones, which he in turn used to defraud additional women.

In October 2014, Giblin travelled from Atlantic County, New Jersey, to Albany County, New York. Giblin, who was on federal supervised release from a previous conviction, was not allowed to leave the state. While traveling in New York, Giblin continued to defraud women and used money he received from women to purchase additional airtime minutes and contact more women. Giblin’s victimized more than 10 women in various states, causing losses of $15,000 to $40,000.

Giblin was previously convicted of 10 counts of wire fraud in 2007 in connection with a similar scheme. In 2015, Giblin was imprisoned for violating the terms of his supervised release imposed in connection with the 2007 sentence. Giblin was also sentenced in 2013 in the Eastern District of Pennsylvania for escaping from a halfway house in Philadelphia, where he was living following the completion of the 2007 sentence. Giblin initiated the scheme in this current case at about the time that he escaped from the halfway house and resumed the scheme following the service of his sentence on the escape conviction.

The count to which Giblin pleaded guilty carries a maximum term of five years in prison and a fine of up to five years in prison and a fine of $250,000. He must also pay restitution to victims. As part of the plea agreement in this case, the U.S. Attorney’s Office will recommend that the Court sentence Giblin to the statutory maximum term of five years. Sentencing is scheduled for May 12, 2017.

U.S. Attorney Fishman 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. Fishman also thanked the U.S. Marshals Service, under the direction of U.S. Marshal Juan Mattos in Newark, for its assistance in this case.

The government is represented by Deputy Attorney-in-Charge Matthew J. Skahill and Assistant U.S. Attorney Gabriel J. Vidoni of the U.S. Attorney’s Office in Camden.

Defense counsel: Christopher O’Malley Esq., Assistant Federal Public Defender (Camden)

NEWARK, N.J. – Two crack-cocaine wholesalers for the New Jersey set of the Grape Street Crips gang today admitted their involvement in racketeering and drug trafficking conspiracies operating in Newark, New Jersey, U.S. Attorney Paul J. Fishman announced today.

Hakeem Vanderhall, a/k/a “Keem,” a/k/a “Sugar Bear,” 32, of East Orange, New Jersey, and Eric Concepcion, a/k/a “Eddie Arroyo,” a/k/a “E-Wax,” a/k/a “Wax,” 30, of Clifton, New Jersey, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to Count 1 and Count 18 of a sixth superseding indictment charging them with racketeering conspiracy and conspiracy to distribute crack-cocaine.

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

The New Jersey Grape Street Crips controlled drug trafficking and other criminal activities in various areas of Newark. Vanderhall, Concepcion and other members of the gang, including Jamar Hamilton, a/k/a “Gunner,” Tyquan Clark a/k/a “Tah,” and Rashan Washington, a/k/a “Shoota,” used and shared a dedicated cell phone to accept orders for, and distribute, thousands of clips of crack-cocaine to other distributors of crack-cocaine, including other gang members.

To protect their gang and drug territory, the New Jersey Grape Street Crips operating in the area of 6th Avenue and North 5th Street in Newark used “community guns” that were easily accessible to gang members. During the course of the investigation, law enforcement agents seized numerous firearms, including a .410 caliber assault rifle, a.45 caliber Thompson semi-automatic carbine, a 7.62 caliber assault rifle, and numerous semi-automatic handguns.

Under the terms of today’s plea agreements, both Vanderhall and Concepcion will be sentenced to 18 years in prison and five years of supervised release. Sentencing for both defendants is scheduled for May 16, 2017.

U.S. Attorney Fishman credited special agents of the DEA, under the direction of Special Agent in Charge Carl J. Kotowski in Newark, and special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, for 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 Carolyn A. Murray; 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 assistance in this case.

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.

Defense counsel:

Vanderhall: Joshua L. Markowitz Esq., Lawrenceville, New Jersey
Concepcion: Stephen Turano Esq., Newark

CAMDEN, N.J. - A Mantua, New Jersey, man today admitted overseeing a more than 15-month conspiracy to sell crack cocaine in Camden, New Jersey, U.S. Attorney Paul J. Fishman announced.

Harold Miller, 41, pleaded guilty before U.S. District Judge Joseph H. Rodriguez in Camden federal court to an information charging him with one count of conspiracy to distribute and to possess with intent to distribute cocaine base.

According to documents filed in this case and statements made in court, Miller admitted that from May 2014 through Sept. 1, 2015, he oversaw a conspiracy to distribute crack cocaine on Pfeiffer Street in Camden. Miller admitted that as part of his role, he managed the drug sales on Pfeiffer Street and coordinated the supply of crack cocaine to other dealers.

The conspiracy charge carries a maximum potential penalty of 20 years in prison. Miller’s sentencing is scheduled for May 8, 2017.

Miller was arrested on Sept. 2, 2015 following an investigation by the FBI’s South Jersey Violent Offender and Gang Task Force. Rasheed Wise, Rodney Wall, and David Wilkerson, all of Camden, previously pleaded guilty to their roles in the conspiracy and await sentencing.

U.S. Attorney Fishman 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.

The government is represented by Deputy Attorney-in-Charge Matthew J. Skahill of the U.S. Attorney’s Office in Camden.

Defense counsel: Christopher O’Malley Esq., Assistant Federal Public Defender, Camden

NEWARK, N.J. – Two men today admitted their roles in a conspiracy to illegally transport foreign nationals into the United States via commercial airline flights, U.S. Attorney Paul J. Fishman announced.

Nileshkumar Patel, 42, and Harsad Mehta, 68, both of India, pleaded guilty before U.S. District Judge William J. Martini in Newark federal court to separate superseding informations charging them each with one count of conspiracy to smuggle foreign nationals into the United States for commercial advantage and private financial gain.

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

Patel and Mehta admitted that from June 2013 through October 2015, they conspired to make money by recruiting Indian nationals to enter and reside in the United States illegally. Patel and Mehta admitted that on July 24, 2014, they brought two Indian nationals to Bangkok, Thailand, so that they could be transported into the United States. They also admitted paying an individual – who was actually an undercover officer – to transport the foreign nationals from Thailand into Newark.

The conspiracy count carries a maximum potential sentence of 10 years in prison. Sentencing is scheduled for May 16, 2017.

U.S. Attorney Fishman credited special agents of the U.S. Department of Homeland Security, Homeland Security Investigations, under the direction of Special Agent in Charge Terence S. Opiola in Newark, with the investigation.

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

Defense counsel:

Patel: Michael P. Koribanics Esq., Clifton, New Jersey

Mehta: Mark A. Berman Esq., River Edge, New Jersey

NEWARK, N.J. – A Clifton, New Jersey, man was sentenced today to 216 months in prison for health care fraud, obstructing a federal audit, and other charges associated with his illegal operation of an ambulance company despite having been banned from participating in federal health care programs, U.S. Attorney Paul J. Fishman announced.

 

Imadeldin Awad Khair, a/k/a “Nadr Awad,” 57, was previously convicted of all 17 counts of an indictment charging him with health care fraud, obstructing a federal audit, tax evasion, and money laundering. He was convicted following a nine-day bench trial before U.S. District Judge Susan D. Wigenton, who imposed the sentence today in Newark federal court.

 

According to documents filed in this case and the evidence presented at trial:

 

In 2004, as a result of his conviction on a New Jersey state health care fraud charge, Khair was excluded from participating in any capacity in Medicare, Medicaid, or other federal health care programs for a minimum of 11 years. After realizing that he would be excluded from federal health care programs, Khair began operating a business named K&S Invalid Coach in his brother’s name. Since the date of his exclusion, Medicare and Medicaid paid over $9 million in claims submitted by K&S, none of which would have been paid had Medicare and Medicaid known that Khair was operating the business.

Khair’s plan to defraud Medicare and Medicaid began almost immediately after he was excluded by authorities from participating in federal health care programs. In 2004 and 2005, Khair recruited a business associate to tell authorities that Khair was his full-time employee so that Khair could continue running K&S in violation of his exclusion. Khair also used fraudulent paystubs provided by his business associate to convince authorities that he was not violating the terms of his exclusion.

In 2014, when special agents with the FBI and the U.S. Department of Health and Human Services, Office of Inspector General, executed a search warrant at K&S’s offices, Khair’s top managers directed employees via group text message to tell the agents that Khair’s brother was really in charge at K&S. In addition, on the first day of trial, Khair tried to influence a government witness just outside of the courtroom by claiming that he had over two dozen employees who were going to testify that his brother had really been in charge at K&S.

Khair also paid numerous K&S employees, including nearly all of the employees’ overtime wages, “off the books” and without withholding the necessary payroll taxes. To carry out the tax evasion scheme, Khair paid the wages in cash or handwritten check and directed K&S employees to keep two separate sets of books. Khair then directed company employees to send only the fraudulent set of books to the company’s payroll accountant.

In response to a U.S. Department of Labor audit of K&S in 2014, Khair held an employee meeting in which he directed K&S employees to lie to the Department of Labor by stating that they never worked more than 80 hours in a biweekly pay period. Khair also directed K&S employees to alter and falsify K&S timekeeping records to match the false amounts previously reported to the company’s payroll accountant.

The money laundering counts arose from K&S checks that were written and endorsed by Khair and made payable to “cash” or Khair himself, which were used to pay the undisclosed wages and enrich Khair personally.

In addition to the prison term, Judge Wigenton ordered Khair to serve three years of supervised release and pay restitution of $8.8 million.

 

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark; special agents of the U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert; and special agents of 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 Assistant U.S. Attorneys Danielle M. Corcione and Osmar J. Benvenuto of the U.S. Attorney’s Office Criminal Division in Newark.

U.S. Attorney Fishman reorganized the health care fraud practice shortly after taking office, creating 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 $1.32 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: Harvey R. Poe Esq., Roseland, New Jersey

TRENTON, N.J. – A Bronx, New York, man was sentenced today to 48 months in prison for his role in a conspiracy to possess with intent to distribute 22 kilograms of heroin in New Jersey, U.S. Attorney Paul J. Fishman announced.

Edwin Alamo Jr., 22, previously pleaded guilty before U.S. District Judge Peter G. Sheridan to an information charging him with one count of conspiracy to possess with intent to distribute more than one kilogram of heroin. Judge Sheridan imposed the sentence today in Trenton federal court.

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

On Feb. 5, 2016, law enforcement observed a tractor-trailer, occupied by Sauro D. Estevez-Figueredo and Alberto Mora, parked at an intersection near a store in Clifton, New Jersey. That afternoon, Emmanuel Gonzalez and Alamo drove to the tractor-trailer and left with a suitcase given to them by Mora. Later, Porfirio Peralta-Nunez arrived at the tractor-trailer with two empty bags and left shortly afterwards with the bags filled.

Subsequent traffic stops allegedly revealed 22 kilograms of heroin in Gonzalez and Alamo’s possession. Additional quantities of narcotics were allegedly found in Peralta-Nunez’s possession. Law enforcement also found 10 kilograms of cocaine and 10 kilograms of fentanyl remaining at the tractor-trailer.

Alamo admitted that he went to Clifton to pick up narcotics from a tractor-trailer and that he obtained a suitcase containing approximately 22 kilograms of heroin.

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

Co-defendants Mora and Gonzalez have pleaded guilty; Gonzalez was sentenced to 120 months in prison and Mora is awaiting sentencing. Charges and allegations pending against Peralta-Nunez and Estevez-Figueredo are merely accusations, and they are considered innocent unless and until proven guilty.

U.S. Attorney Fishman credited special agents of the Drug Enforcement Administration (DEA), 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 Meredith Williams of the Narcotics/OCDETF unit of the U.S. Attorney’s Office in Newark.

Defense counsel: Chester Keller Esq., First Assistant Federal Public Defender

NEWARK, N.J. – Two Newark men who collectively carried out two armed carjackings and one attempted carjacking in September 2013 were each sentenced to prison today, U.S. Attorney Paul J. Fishman announced.

 

Dion Hines, 23, and Roosevelt Robinson, 25, were sentenced to 192 and 171 months in prison, respectively. Hines previously pleaded guilty before U.S. District Judge Katharine S. Hayden to an information charging him with one count of attempted carjacking, two counts of carjacking, and one count of using a firearm during a crime of violence. Robinson previously pleaded guilty to an information charging him with one count of attempted carjacking, one count of carjacking, and one count of using a firearm during a crime of violence. Judge Hayden imposed both sentences today in Newark federal court.

 

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

 

On Sept. 22, 2013, Hines, Robinson, and another male individual approached a Mercedes Benz sedan that was parked in a residential driveway in Newark. Hines brandished a handgun and ordered the driver to get out of the vehicle. The victim eventually got out of the car and Robinson sat in the driver’s seat. After Hines and the other male individual fled on foot, the victim fought Robinson, pulled him from the Mercedes Benz, and got back into the vehicle. Hines returned and fired two shots at the Mercedes Benz. Afterwards, Hines, Robinson, and the other male individual fled the scene.

 

On Sept. 26, 2013, Hines approached two individuals at a parking lot in Newark, threatened them with a handgun, and demanded the keys to their vehicles. After one of the victims gave Hines the keys to a 2009 Acura sedan, he got into the car and fled.

 

On the morning of Sept. 27, 2013, Hines was traveling in a dark-colored SUV driven by another individual. The SUV pulled in front of a Range Rover stopped at an intersection in Belleville, New Jersey, blocking the Range Rover’s path. Hines got out of the SUV and pointed a handgun at the driver of the Range Rover. Robinson, who followed the SUV in a separate vehicle, pulled over and stood watch. Hines pulled the driver out of the Range Rover, got into the vehicle and fled, followed by the SUV and Robinson’s vehicle.

 

In addition to the prison terms, Judge Hayden sentenced both Hines and Robinson to five years of supervised release.

 

U.S. Attorney Fishman credited special agents of the U.S. Department of Homeland Security, Homeland Security Investigations, under the direction of Special Agent in Charge Terence S. Opiola in Newark; the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Carolyn A. Murray; and the Newark, Elizabeth, and Belleville police departments with the investigation.

 

The government is represented by Assistant U.S. Attorney J. Jamari Buxton of the U.S. Attorney’s Office Organized Crime/Gangs in Newark.

 

Defense Counsel:

 

Hines: John Yauch Esq., Assistant Federal Public Defender, Newark

Robinson: Paul Condon Esq., Jersey City, New Jersey

TRENTON, N.J. – An Iselin, New Jersey, man was sentenced today to 46 months in prison for his role in one of the largest credit card fraud schemes ever charged by the U.S. Department of Justice, U.S. Attorney Paul J. Fishman announced.

 

Babar Qureshi, 63, previously pleaded guilty before U.S. District Judge Anne E. Thompson to Count One of an indictment charging him with conspiracy to commit bank fraud. Judge Thompson imposed the sentence today in Trenton federal court.

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

Qureshi was originally charged in February 2013 as part of a conspiracy to fabricate more than 7,000 false identities to obtain tens of thousands of credit cards. The scheme involved a three-step process in which the defendants would make up a false identity by creating fraudulent identification documents and a fraudulent credit profile with the major credit bureaus; pump up the credit of the false identity by providing false information about that identity’s creditworthiness to those credit bureaus; and finally, run up large loans.

The scope of the criminal fraud enterprise required Qureshi and other conspirators to construct an elaborate network of false identities. Across the country, the conspirators maintained more than 1,800 “drop addresses,” including houses, apartments and post office boxes, which they used as the mailing addresses of the false identities.

Qureshi’s role in the conspiracy was to take the phony cards and charge large amounts at complicit merchants, who would then pay him a portion of the charge. He used phony bank accounts to conceal his involvement and receive proceeds from the fraud, which he used for personal expenses, including his mortgage.

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

U.S. Attorney Fishman credited special agents of the FBI’s Cyber Division, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation leading to today’s sentencing. He also thanked postal inspectors under the direction of Inspector in Charge James V. Buthorn, the U.S. Secret Service, Newark Field Office, under the direction of Special Agent in Charge Mark McKevitt, and the U.S. Social Security Administration, Office of the Inspector General, for their roles in the investigation.

The government is represented by Assistant U.S. Attorney Daniel Shapiro and Deputy Chief Zach Intrater of the U.S. Attorney’s Office’s Economic Crimes Unit, and Sarah Devlin of the Assert Forfeiture and Money Laundering Unit.

Defense counsel: Alexander Spiro Esq., New York

NEWARK, N.J. – A Cranbury Township, New Jersey, man was sentenced today to 37 months in prison for failing to report over $1.5 million in income he fraudulently diverted to overseas shell companies, U.S. Attorney Paul J. Fishman announced.

Michael Q. Fu, 53, previously pleaded guilty before U.S. District Court Judge William H. Walls to an information charging him with one count of conspiring to evade income taxes and one substantive count of tax evasion. Judge Walls imposed the sentence today in Newark federal court.

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

Fu and Albert W. Chang, 69, of Princeton Junction, New Jersey, co-owned and operated United Products and Instruments Inc. (UNICO) located in Dayton, New Jersey. UNICO was established by Fu and Chang in 1991 and primarily engaged in the sale and export of microscopes and centrifuges for medical purposes.

As part of the conspiracy, Fu and Chang created two shell companies headquartered in China – Action Towers and Bench Top Laboratories. Fu and Chang then diverted business income to themselves by funneling money to the shell companies’ bank accounts and deducting the diverted funds from UNICO’s corporate tax return as the cost of goods sold or commission.

In addition, Fu and Chang had Shanghai Electric, a Hong Kong based utility company, overbill UNICO by approximately five percent on legitimate invoices. Once the invoices were paid by UNICO, they directed Shanghai Electric to wire transfer the overbilled amount to their accounts in China, which they used for their personal benefit. Fu and Chang failed to report any of that income on their federal income tax returns.

In addition to the prison term, Judge Walls sentenced Fu to three years of supervised release and ordered him to pay restitution of over $870,000.

Chang pleaded guilty to his role in the conspiracy in September 2016 and awaits sentencing.

U.S. Attorney Fishman credited special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen; special agents of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), under the direction of Special Agent in Charge Terence S. Opiola; and officers of the Springfield Police Department, under the direction of Chief John Cook, with the investigation.

The government is represented by Senior Litigation Counsel Margaret Ann Mahoney of U.S. Attorney’s Criminal Division in Newark.

Defense counsel: Steven Seltzer Esq., New York, New York

NEWARK, N.J. – A New York man was arrested for his role in one of the largest credit card fraud schemes ever charged by the Justice Department, U.S. Attorney Paul J. Fishman announced.

Habib Chaudhry, 49, of Valley Stream, New York, was initially charged by complaint in February 2013 and then by indictment in September 2013. Chaudhry has been a fugitive for nearly four years. He is expected to make his initial appearance later today before U.S. Magistrate Judge Leda Dunn Wettre in Newark federal court.

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

Chaudhry was indicted as part of a conspiracy – led by Tahir Lodhi, Babar Qureshi, Ijaz Butt, and others – to fabricate more than 7,000 false identities to obtain tens of thousands of credit cards. Since then, 19 people, have pleaded guilty in connection with the scheme.

The scheme involved a three-step process in which the defendants would make up a false identity by creating fraudulent identification documents and a phony credit profile with the major credit bureaus; pump up the credit of the false identity by providing bogus information about that identity’s creditworthiness; then borrow or spend as much as they could without repaying the debts. The scheme caused more than $200 million in confirmed losses to businesses and financial institutions.

The scope of the criminal fraud enterprise required the conspirators to construct an elaborate network of false identities. Across the country, the conspirators maintained more than 1,800 “drop addresses,” including houses, apartments and post office boxes, which they used as the mailing addresses for the false identities.

U.S. Attorney Fishman credited special agents of the FBI’s Cyber Division, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation leading the charges. He also thanked postal inspectors with the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge James V. Buthorn, Newark Division, special agents of the U.S. Secret Service, under the direction of Special Agent in Charge Mark McKevitt, and the U.S. Social Security Administration for their assistance.

The government is represented by Assistant U.S. Attorneys Zach Intrater and Daniel Shapiro of the U.S. Attorney’s Office Economic Crimes Unit, as well as Assistant U.S. Attorney Barbara Ward, Acting Chief of the Asset Forfeiture and Money Laundering Unit.
 

This case was brought in coordination with President Barack Obama’s 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. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.stopfraud.gov.

 

 

TRENTON, N.J. – An Irvington, New Jersey, man today admitted that he stole more than $840,000 from the U.S. Government through a scheme to exchange food stamps for cash, U.S. Attorney Paul J. Fishman announced.

Miguel Antonio Azcona, a/k/a “Miguel A. Azcona-Peralta,” 38, pleaded guilty before U.S. District Judge Mary L. Cooper in Trenton federal court to an information charging him with one count of theft of government funds.

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

Azcona was the owner of New Community Supermarket on Springfield Avenue in Newark, New Jersey. New Community Supermarket was a small grocery that was authorized to accept Supplemental Nutrition and Assistance Program (SNAP) benefits (formerly known as food stamps). Azcona controlled a business bank account for New Community Supermarket to receive the reimbursements for SNAP benefits.

Azcona knew that as a SNAP retailer, he was not allowed to exchange food stamps for cash. Yet from August 2014 through Aug. 11, 2016, Azcona and others, including employees under his supervision, unlawfully redeemed SNAP benefits in exchange for cash rather than food. In return for exchanging SNAP benefits for cash, New Community Supermarket retained a portion of the transaction’s value for Azcona’s benefit.

At his plea hearing, Azcona admitted that his conduct resulted in losses of approximately $840,583.54.

The count of theft of government funds carries a maximum penalty of 10 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Sentencing is set for May 3, 2017.

U.S. Attorney Fishman credited special agents of the U.S. Department of Agriculture, Office of Inspector General, under the direction of Special Agent in Charge Bethanne M. Dinkins in New York; and U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), under the direction of Special Agent in Charge Terence S. Opiola.

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

Defense counsel: David R. Oakley, Esq.

NEWARK, N.J. – A Bronx, New York, man today admitted his role in a scheme to obtain stolen identity information and use it to file phony tax returns with the IRS, U.S. Attorney Paul J. Fishman announced.

 

Yerfri Castillo, 26, pleaded guilty before U.S. District Judge John Michael Vazquez to an information charging him with one count of conspiracy to steal government funds, one count of theft of government funds, and one count of aggravated identity theft.

 

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

 

From January 2013 through May 2015, Castillo conspired with Jhan Luis Mejia Marcelino, 27, Odanys Orlando Rojas, a/k/a “El Fuerte,” 39, both of Bronx, and others to use stolen identities to commit tax refund fraud. Castillo admitted that he and others obtained stolen personal identifying information, including names and Social Security numbers, of victims located in New Jersey, Puerto Rico, and elsewhere. Afterwards, Castillo used the information to file fraudulent federal tax returns. Castillo also admitted that, once they received the refunds, he converted checks to cash or other proceeds for his own benefit.

 

Altogether, the conspiracy caused losses of over $2.89 million to the U.S. Treasury.

 

The conspiracy offense is punishable by a maximum potential penalty of five years in prison. The theft of government funds count is punishable by a maximum potential penalty of 10 years in prison. Both counts are punishable by a $250,000 fine, or twice the gain or loss resulting from the offense. The aggravated identity fraud charge is punishable by a mandatory two-year sentence to be served consecutively to any other term imposed. Sentencing is scheduled for May 2, 2017.

 

Both Mejia and Rojas pleaded guilty to their roles in September 2016 and await sentencing.

 

U.S. Attorney Fishman credited special agents of the 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. Postal Service Office of Inspector General, under the direction of Special Agent in Charge Monica Weyler; and special agents of the U.S. Secret Service, Newark Field Office, under the direction of Special Agent in Charge Mark McKevitt, with the investigation.

 

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

 

Defense counsel: Edgar L. Fankbonner Esq.

NEWARK, N.J. – A Bergen County, New Jersey, woman was sentenced today to 25 months in prison for her role in conspiring to deposit more than $1 million in fraudulent checks into different bank accounts, U.S. Attorney Paul J. Fishman announced.

 

Chunhua Jin, 46, of Ridgefield, New Jersey, previously pleaded guilty before U.S. District Judge Kevin McNulty to an information charging her with one count of bank fraud conspiracy. Judge McNulty imposed the sentence today in Newark federal court.

 

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

 

From July 2014 to April 2015, Jin and others opened accounts at banks, such as Bank of America, in the names of fake businesses. The conspirators then made small deposits and withdrawals over several weeks to make the accounts appear legitimate. Jin or a conspirator would eventually deposit a fake check for a large dollar amount into the account. The victim banks typically credited some or all of the deposit amount on the fake check for immediate withdrawal. The conspirators then withdrew as much money as possible from the account before the bank realized that the check was fraudulent and blocked further withdrawals. Jin and others made ATM cash withdrawals, submitted cash withdrawal slips and make debit card purchases on merchandise. Jin admitted that the scheme resulted in a loss to the banks of at least $1.7 million.

 

In addition to the prison term, Judge McNulty sentenced Jin to five years of supervised release and ordered restitution and forfeiture of $1.7 million.

 

U.S. Attorney Fishman credited postal inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge James V. Buthorn; investigators from the Middlesex County Prosecutor=s Office, under the direction of Prosecutor Andrew C. Carey; and investigators from the Morris County Prosecutor’s Office, under the direction of Prosecutor Fredric M. Knapp with the investigation leading to today’s sentencing.

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

 

Defense counsel: Peter Weiner Esq., Union City, New Jersey