District of New Jersey
Press releases recorded for this federal judicial district.
New York Man Admits Distribution Conspiracy Involving More Than 10 Kilograms of Synthetic Designer DrugsRead the Press Release
NEWARK, N.J. – A Queens, New York, man today admitted his role in a scheme to distribute controlled substance analogues, which are designer drugs that have chemical structures and hallucinogenic effects similar to Schedule I controlled substances, U.S. Attorney Paul J. Fishman announced.
Elmostafa Charif, 37, pleaded guilty before U.S. District Judge Kevin McNulty to a two-count indictment charging him with conspiracy to distribute, and possessing with intent to distribute, the controlled substance analogues NM2201 and 5F-AMB. NM2201 and 5F-AMB are most closely related to synthetic Tetrahydrocannabinol, or THC.
According to documents filed in this case and statements made in court:
Since February 2011, the Drug Enforcement Administration (DEA) has been investigating the importation, distribution, and use of designer drugs popularly known as synthetic cannabinoids. “K2” and “Spice” are common examples of synthetic cannabinoids.
Synthetic cannaboids are created when damiana leaves – an inert, plant-like substance – are sprayed with controlled substance analogues and treated with synthetic flavoring. The flavored and treated damiana leaves are then smoked by users.
Charif admitted that, on April 13, 2015, he conspired with others to purchase and distribute approximately 10 kilograms of synthetic cannabinoids, including approximately five kilograms of NM2201 and approximately five kilograms of 5F-AMB. Charif also admitted that he purchased liquid flavoring and damiana leaves with the controlled substance analogues, knowing that they would be used to create a product that was smoked or otherwise consumed by users.
NM2201 and 5F-AMB are each controlled substance analogues as defined under the Analogue Act due to the fact that both NM2201 and 5F-AMB have chemical structures and hallucinogenic properties similar to the Schedule I controlled substances 5F-PB-22 and ADB-PINACA, respectively.
Both counts of the indictment to which Charif pleaded guilty carry a maximum potential penalty of 20 years in prison and a $1 million fine, or twice the gross gain or loss from the offense. Sentencing is scheduled for Feb. 22, 2017.
U.S. Attorney Fishman credited special agents of the DEA, under the direction of Special Agent in Charge Carl J. Kotowski, with the investigation leading to today’s plea.
The government is represented by Assistant U.S. Attorney Melissa Wangenheim of the Organized Crime Drug Enforcement Task Force Unit in Newark.
Defense counsel: Aaron Wallenstein, Esq.
Somerset County, New Jersey, Man Admits Role in Five Bank Robberies, One Attempted Bank RobberyRead the Press Release
NEWARK, N.J. – A Bound Brook, New Jersey, man today admitted robbing five banks and attempting to rob another between June 2014 and June 2015, U.S. Attorney Paul J. Fishman announced.
Luis Castaneda, 40, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to an information charging him with six counts of bank robbery and one count of brandishing a firearm in furtherance of one of the robberies.
According to documents filed in this case and statements made in court:
Castaneda admitted that between June 6, 2014 and June 12, 2015, he robbed or attempted to rob six banks, all in New Jersey:
Date
Financial Institution
Location
June 6, 2014
County Educators Federal Credit Union
Somerville
Dec. 3, 2014
Manville Area Federal Credit Union
Manville
March 19, 2015
Public Service Credit Union
Middlesex
May 9, 2015
Peapack-Gladstone Bank (Attempt)
Piscataway
May 9, 2015
Unity Bank
Whitehouse Station
June 12, 2015
Somerset Savings Bank
Somerset
Castaneda admitted that during each of the above robberies, he and others threatened to use force while demanding money from the bank employees. He also admitted that during the Somerset Savings Bank robbery on June 12, 2015, he brandished a firearm in order to intimidate one or more of the bank employees.
The bank robbery charges to which Castaneda pleaded guilty each carry a maximum penalty of 20 years in prison and a $250,000 fine. The charge of brandishing a firearm carries a mandatory minimum sentence of seven years to be served consecutively to any other sentence imposed. Sentencing is scheduled for Feb. 15, 2016.
U.S. Attorney Fishman credited special agents of the FBI Franklin Township Resident Agency, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation leading to today’s guilty plea. He also thanked the Somerset County Prosecutor’s Office, the Middlesex County Prosecutor’s Office, and the Hunterdon County Prosecutor’s Office, as well as the Somerville, Manville, Piscataway, Readington Township, Middlesex Borough, and Bound Brook police departments for their contributions to the case.
The government is represented by Assistant U.S. Attorney Meredith Williams of the U.S. Attorney’s Office Criminal Division in Newark.
Defense counsel: John Azzarello Esq.
Former Deputy Executive Director of Port Authority and Former Deputy Chief of Staff in N.J. Governor’s Office Guilty on All CountsRead the Press Release
Misused Government Property to Punish Fort Lee Mayor for Not Endorsing Gov. Christie’s Re-election
NEWARK, N.J. – A former top official of the Port Authority of New York and New Jersey and a former member of Gov. Christopher J. Christie’s senior staff were convicted today for their roles in a scheme to punish the mayor of Fort Lee, New Jersey, by misusing Port Authority resources to cause traffic problems in the borough.
William E. Baroni Jr., 44, former deputy executive director of the Port Authority, and Bridget Anne Kelly, 44, former deputy chief of staff to Gov. Christie, were each convicted on all seven counts with which they had been charged in an indictment returned May 1, 2015, by a federal grand jury. The jury deliberated less than four days following a six-week trial before U.S. District Judge Susan D. Wigenton in Newark federal court.
“We are gratified that the members of the jury saw the evidence the way we saw it and reached their verdict of guilty today,” U.S. Attorney Paul J. Fishman said. “This was a long and difficult investigation, and I am so proud of the way the members of my office, the FBI and the Port Authority Inspector General conducted themselves in the course of this case.”
“The citizens of the state of New Jersey have a right to expect and deserve honest services from their government, and the FBI and our law enforcement partners remain dedicated to ensuring they receive it,” FBI Special Agent in Charge Timothy Gallagher of the Newark office said.
“We are extremely pleased with the jury’s verdict in this matter,” Michael Nestor, Inspector General of the Port Authority of New York and New Jersey, said. “I want to express my gratitude to the U.S. Attorney’s Office, FBI and Office of Inspector General staff on the tremendous effort they all made resulting in the verdict.”
Baroni and Kelly were each convicted of conspiring to misuse, and actually misusing, property of an organization receiving federal benefits; conspiring to commit, and actually committing, wire fraud; conspiring to injure and oppress certain individuals’ civil rights, and acting under color of law to deprive certain individuals of their civil rights. All of the charges relate to the defendants’ scheme to manufacture traffic problems in Fort Lee by, without public warning, reducing from three to one the number of local access lanes, located in Fort Lee, to the upper level of the George Washington Bridge, and the toll booths servicing those lanes. This was done to punish Mayor Mark Sokolich for not endorsing Gov. Christie’s re-election bid.
A third conspirator, David Wildstein, the former director of Interstate Capital Projects at the Port Authority, pleaded guilty May 1, 2015, to a separate information charging him with two counts of conspiracy for his role in the scheme. Wildstein pleaded guilty to conspiring to misuse the property of an organization receiving federal benefits and conspiring to injure and oppress certain individuals’ civil rights in connection with his role in causing traffic problems to punish Mayor Sokolich.
According to documents filed in this case, statements made in court and the evidence at trial:
In August 2013, after Kelly confirmed that Mayor Sokolich would not be endorsing Gov. Christie for re-election in November 2013, Baroni, Kelly, and Wildstein decided to punish the mayor by deliberately causing significant traffic problems in Fort Lee under the false pretense of a traffic study.
From the morning of Sept. 9, 2013, to Sept. 13, 2013, they caused the local access lanes to be reduced so that only one toll booth, instead of the usual three, was accessible to the approach to the bridge for local traffic traveling through Fort Lee. To maximize the congestion and the punitive impact on Mayor Sokolich, Baroni, Kelly and Wildstein caused these lane and toll booth reductions to start on the first day of the school year without any advance notice to Mayor Sokolich, the Fort Lee chief of police or borough residents. The lane and toll booth reductions resulted in significant traffic in Fort Lee, for motorists intending to access the George Washington Bridge from local lanes and for residents, whose streets were choked with traffic.
The conspirators agreed to disregard any inquiries from Mayor Sokolich and other Fort Lee officials about the lane and toll booth reductions. They purposely ignored communications from Mayor Sokolich, including his pleas for help, requests for information, and repeated warnings about the increased risks to public safety. On Sept. 9, 2013, after Baroni received an email that Mayor Sokolich had called about an urgent matter of public safety, Wildstein sent an email to Baroni reiterating that Baroni should maintain “radio silence” toward the mayor. On Sept. 10, 2013, Kelly sent Wildstein a text message stating: “I feel badly about the kids … I guess,” to which Wildstein replied, “They are the children of Buono voters …” a reference to Christie’s opponent in the gubernatorial election, state Sen. Barbara Buono (D-Middlesex).
When Kelly was made aware of Mayor Sokolich’s communication regarding an urgent matter of public safety, she thanked Wildstein for confirming that Baroni had maintained “[r]adio silence” toward Mayor Sokolich. On Sept. 12, 2013, Baroni instructed a Port Authority employee through coded language that the employee should not contact Mayor Sokolich.
The three conspirators concocted and promoted a sham story that the lane reductions were for a traffic study. They created and advanced this cover story so they could use Port Authority property, including the time and services of unwitting Port Authority personnel and other resources, to implement the lane and toll booth reductions and conceal their true punitive purpose.
On Nov. 25, 2013, with Kelly’s and Wildstein’s knowledge, Baroni provided false and misleading testimony about the lane and toll booth reductions to the N.J. Assembly Transportation, Public Works, and Independent Authorities Committee. Baroni knowingly and intentionally made misleading statements and false representations, including: (1) communications between members of the Port Authority Police Department and Wildstein triggered the lane and toll booth reductions; (2) the lane and toll booth reductions were part of a one-week traffic study; and (3) the failure to communicate with Fort Lee and the executive director of the Port Authority was simply the result of communication breakdowns at the Port Authority.
On the count of conspiracy to misuse property of an organization receiving federal benefits, the three defendants each face a maximum potential penalty of five years in prison and a fine of $250,000. On the count of misusing property of an organization receiving federal benefits, the defendants each face a maximum potential penalty of 10 years in prison and a fine of $250,000. On each of the wire fraud conspiracy and wire fraud counts, the defendants face a maximum potential penalty of 20 years in prison and a fine of $250,000 per count. On the count of conspiring to injure and oppress certain individuals’ civil rights, the defendants and Wildstein each face a maximum potential penalty of 10 years in prison and a fine of $250,000. On the count of acting under color of law to deprive certain individuals of their civil rights, the defendants face a maximum potential penalty of one year in prison and a fine of $250,000.
Sentencing is scheduled for Feb. 21, 2017.
U.S. Attorney Fishman credited criminal investigators of the Port Authority, Office of Inspector General, under the direction of Inspector General Nestor; special agents of the FBI, under the direction of Special Agent in Charge Gallagher; and criminal investigators of the U.S. Attorney’s Office, for the investigation leading to today’s guilty verdicts.
The government is represented by Assistant U.S. Attorneys Lee M. Cortes Jr., Vikas Khanna, David W. Feder and Senior Litigation Counsel J Fortier Imbert of the U.S. Attorney’s Office Special Prosecutions Division.
Defense counsel:
William E. Baroni: Michael Baldassare Esq., Newark
Bridget Anne Kelly: Michael Critchley Sr. Esq., Roseland, New Jersey
Hudson County Contractor Gets over A Year in Prison for Paying Bribes to Bayonne Official for Government-Funded ProjectsRead the Press Release
TRENTON, N.J. – A Bayonne, New Jersey, man was sentenced today to 15 months in prison for paying $65,000 in bribes to a Bayonne public official in return for the public official’s assistance in securing projects funded by the U.S. Department of Housing and Urban Development, U.S. Attorney Paul J. Fishman announced.
Joseph Arrigo, 47, previously pleaded guilty before U.S. District Judge Peter G. Sheridan to an information charging him with one count of paying bribes totaling approximately $65,000 to Anselmo Crisonino, 56, also of Bayonne, who served as the senior accountant of the City of Bayonne Department of Community Development (CBDCD). Arrigo had also pleaded guilty to one count of theft and conversion of government funds in the amount of $40,000, and one count of submitting a false tax return for tax year 2011. Judge Sheridan imposed the sentence today in Trenton federal court.
According to documents filed in this case and statements made in court:
Arrigo was the owner of Shadow Contracting LLC, a general contracting company in Bayonne. The CBDCD was a government agency that received funds from the U.S. Department of Housing and Urban Development (HUD) under a federal program that provided grants of 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 payments from Arrigo in exchange for Crisonino’s help in attaining HUD grant funds. From September 2010 to February 2013, Arrigo made approximately $65,000 in cash payments to Crisonino in exchange for Crisonino’s assistance in awarding approximately $426,000 in HUD grant funds to Arrigo from the CBDCD.
In September 2011, Arrigo assisted another contractor by supplying a bid on behalf of Shadow Contracting that was higher than the contractor’s bid to enable the other contractor to obtain HUD grant funds from Bayonne. The contractor then submitted the two bids to the CBDCD and, as a result of his collusion with Arrigo, the contractor fraudulently obtained $20,000 in HUD grant funds from the CBDCD. In December 2011, Arrigo caused the same contractor to provide Arrigo with a bid that was higher than Arrigo’s bid for the purpose of obtaining HUD grant funds. Arrigo submitted the contractor’s bid along with his own to the CBDCD and, as a result, fraudulently obtained another $20,000 in HUD grant funds from the CBDCD.
Arrigo also admitted that he failed to report $151,993 in income on his U.S. Individual Tax Return, Form 1040, for tax year 2011.
In addition to the prison term, Judge Sheridan sentenced Arrigo to three years of supervised release.
Crisonino previously pleaded guilty to his role in the bribery scheme and other charges in February 2014 and awaits sentencing.
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.
The government is represented by Assistant U.S. Attorney Jacques S. Pierre of the U.S. Attorney's Special Prosecutions Division in Newark.
Defense counsel: Charles J. Uliano Esq., West Long Branch, New Jersey
Bergen County, New Jersey, Man Gets Three Years in Prison for Embezzling Millions of Dollars from North Jersey BusinessRead the Press Release
TRENTON, N.J. – The former chief financial officer of a Bergen County business was sentenced today to 36 months in prison for embezzling millions of dollars and evading taxes, U.S. Attorney Paul J. Fishman announced.
Gomidas Garabed Hartounian, 52, of Franklin Lakes, New Jersey, previously pleaded guilty before U.S. District Judge Peter G. Sheridan to a superseding information charging him with one count of wire fraud and one count of tax evasion. Judge Sheridan imposed the sentence today in Trenton federal court.
According to documents filed in this case and statements made in court:
From April 2007 through April 2014, Hartounian was the CFO for “Company A,” a for-profit company with its principal place of business in Englewood, New Jersey. Hartounian is also the sole owner of MGB LLC, a company registered to his residence. Hartounian fraudulently designated MGB as a vendor in Company A’s accounting system without disclosing that he controlled MGB. He directed Company A employees to issue checks to MGB for freight services that MGB supposedly provided Company A. When asked for the MGB invoices, he claimed that he was maintaining them in his office.
Because Hartounian didn’t have sole signatory power, he forged the signatures of the chief executive officer or the chief operating officer before depositing the checks into bank accounts that he controlled. Hartounian also had checks issued directly from Company A bank accounts to pay for his personal expenses, including real estate taxes to the Borough of Franklin Lakes for $6,562 in August 2011.
Hartounian also admitted that he filed a false federal tax return, Form 1040, for the calendar year 2012 in which he knowingly did not report $1.29 million in income that he received as the sole owner of MGB. Instead, Hartounian falsely understated his income for 2012 as $133,290.
In addition to the prison term, Judge Sheridan sentenced Hartounian to three years of supervised release. Hartounian must also pay restitution of $4,117,463, which includes $3.5 million to the victim company and $617,463 to the IRS.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, and IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen, with the investigation.
The government is represented by Assistant U.S. Attorney Shana W. Chen of the U.S. Attorney’s Office Economic Crimes Unit in Newark.
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.
Defense counsel: Alan Silber Esq., Roseland, New Jersey
Long Island Man Gets More Than Five Years in Prison for Role in International $200 Million Credit Card Fraud ConspiracyRead the Press Release
TRENTON, N.J. – A Hicksville, New York, man was sentenced today to 63 months in prison 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.
Ijaz Butt, 57, 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:
Butt 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. Since then, 19 people, including Butt, 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 borrowed or spent as much as they could without repaying the debts – causing more than $200 million in confirmed losses to businesses and financial institutions.
The scope of the criminal fraud enterprise required Butt 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.
Butt admitted that he helped obtain credit cards in the name of third parties – many of which were fictional – then directed the credit cards to be mailed to addresses controlled by members of the conspiracy. He also admitted they knew the cards would be used fraudulently at businesses.
In addition to the prison term, Judge Thompson sentenced Butt to three years of supervised release and fined him $3,000.
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; postal inspectors with the U.S. Postal Inspection Service, under the direction of Inspector in Charge Maria L. Kelokates, Newark Division; and special agents of the U.S. Secret Service, under the direction of Special Agent in Charge Mark McKevitt, with the investigation leading to today’s sentencing. He also thanked the U.S. Social Security Administration for its assistance.
The government is represented by Assistant U.S. Attorneys Daniel V. Shapiro and Zach Intrater of the U.S. Attorney’s Office Economic Crimes Unit and Barbara Ward, Acting Chief of the office’s Asset Forfeiture and Money Laundering Unit in Newark.
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.
Defense counsel: Kenneth W. Kayser Esq., East Hanover, New Jersey
Atlantic City Couple Admit Drug Trafficking and Money LaunderingRead the Press Release
CAMDEN, N.J. – An Atlantic City couple yesterday admitted their respective roles in drug trafficking and money laundering in the Atlantic County area, U.S. Attorney Paul J. Fishman announced.
Toye Tutis, 44, pleaded guilty before U.S. District Judge Jerome B. Simandle in Camden federal court to Count One of a second superseding indictment, charging him with conspiracy to distribute and possess with intent to distribute cocaine, crack cocaine and heroin, and Count 13 charging him with conspiring with his long-time paramour, Jazmin Vega, 42, to launder his drug trafficking proceeds. Vega also pleaded guilty to the Count 13 conspiracy to launder Tutis’s drug proceeds.
According to documents filed in this case and statements made in court:
From 2010 through December 2014, Tutis operated a large-scale drug trafficking ring out of the Ta’Ja Laundromat in Atlantic City, purchasing and distributing between 150 to 450 kilograms of cocaine and approximately 26 kilograms of heroin, and laundering between $1.5 and $3 million in drug proceeds. Tutis was aided by Vega, who admitted to laundering his drug trafficking proceeds in several ways, including through the couple’s various businesses – Ta’Ja Construction I LLC; Ta’Ja Real Estate Investors LLC; and Integrity Heating and Cooling LLC; and by purchasing more than 30 properties with tainted funds. As part of their plea agreements, Vega and Tutis have to forfeit 20 properties, cash and other assets.
The drug trafficking conspiracy count to which Tutis pleaded guilty carries a maximum potential penalty of life in prison and a fine of $10 million. The money laundering count to which Tutis and Vega both pleaded guilty carries a maximum potential penalty of 20 years in prison and a $500,000. Sentencing is scheduled for Feb. 17, 2017.
Nine other people have pleaded guilty to participating in the drug trafficking conspiracy or other related drug trafficking in the Atlantic County area, including:
- Kabaka Atiba, 46, of Atlantic City, sentencing scheduled for Jan. 20, 2017;
- Tozine Tiller, 42, of Absecon, sentencing scheduled for Jan. 20, 2017;
- TeJohn Cooper, 43, of Galloway Township, sentencing scheduled for Dec. 16, 2016;
- Ronald Douglas Byrd, 51, of Pleasantville, sentencing scheduled for Dec. 2, 2016;
- Kareem Taylor, 41, of Atlantic City; sentencing scheduled for Dec. 2, 2016;
- Talib Tiller, 43, of Mays Landing, sentencing scheduled for Dec. 1, 2016;
- John Wellman, 41, of Somers Point, sentencing scheduled for Dec. 1, 2016;
- Phillip Horton, 50, of Los Angeles, California, sentencing scheduled for Dec. 1, 2016; and
- Francisco Alberto Rascon-Muracami, 22, of Obregon, Mexico, sentenced on Oct. 30, 2015, to 70 months’ imprisonment and five years of supervised release.
U.S. Attorney Fishman credited special agents of the FBI’s Newark Division, Atlantic City Resident Agency, under the direction of Special Agent in Charge Timothy Gallagher; the DEA’s New Jersey Division, under the direction of Special Agent in Charge Carl J. Kotowski; the Atlantic County Prosecutor’s Office, under the direction of Acting Prosecutor Diane Ruberton; and the Atlantic City Police Department, under the direction of Police Chief Henry White, with the investigation leading to today’s guilty pleas.
He also thanked the N.J. State Police; the Pennsylvania State Police, the Atlantic County Sheriff’s Office; the Bureau of Alcohol, Tobacco and Firearms; U.S. Immigration and Customs Enforcement (ICE)-Homeland Security Investigation (HSI); U.S. Postal Inspection Service; Cumberland County Sheriff’s Office and the Ventnor, Northfield and Millville police departments for their assistance.
The government is represented by Assistant U.S. Attorneys Diana Carrig and Howard Wiener of the Camden Division and Jonathan M. Peck of the Newark Division.
Defense counsel:
Tutis: J. Michael Farrell Esq., Philadelphia
Vega: Troy A. Archie Esq., Cinnaminson, New Jersey
Leaders of Violent Bloods Street Gang Admit Racketeering ConspiracyRead the Press Release
NEWARK, N.J. – Two leaders of the Sex Money Murder set of the Bloods street gang today admitted their respective roles in a racketeering conspiracy that involved murder, attempted murder, conspiracy to commit murder, and conspiracy to distribute heroin, U.S. Attorney Paul J. Fishman announced.
Narik Wilson, a/k/a “Spaz,” 32, and Emil Rutledge, a/k/a “Diddy,” 27, both of Newark, New Jersey, pleaded guilty before U.S. District Judge Susan D. Wigenton in Newark federal court to Count Two of a 14-count superseding indictment charging them with racketeering conspiracy.
According to documents filed in this case and statements made in court:
The Bloods street gang is organized into subgroups that operate in specific geographic locations. Sex Money Murder is the subgroup that operates primarily in Essex County, New Jersey.
Wilson and Rutledge, high-ranking members in Sex Money Murder, admitted that from 2007 to 2011 they committed a series of violent crimes to advance the gang’s objectives. Wilson, the leader, or “O.G.,” of Sex Money Murder, admitted that he directed the murder and attempted murder of eight rival gang members in and around Newark. Rutledge, a “captain,” or “shot-caller,” of Sex Money Murder, admitted that he and others carried out a number of the shootings ordered by Wilson, causing series injuries to others and the death of a victim.
Wilson admitted that he conspired with and directed other members of Sex Money Murder to murder the following individuals described in the indictment:
- Feb. 4, 2007, attempted murder of a rival gang member, (Victim 1);
- Feb. 16, 2007, attempted murder of a rival gang member (Victim 2);
- Oct. 29, 2010, attempted murder of a rival gang member (Victim 3);
- June 16, 2011, attempted murder of rival gang members (Victims 4-7);
- July 14, 2011, murder of a rival gang member (Victim 8);
- Aug. 3, 2011, attempted murder of a rival gang member (Victim 6).
Rutledge admitted that, acting at Wilson’s direction, he and others carried out drive-by shootings of Victims 3 through 7 on the above-described dates. Rutledge also admitted that he and others killed Victim 8 in a drive-by shooting. Wilson and Rutledge admitted conspiring to distribute more than one kilogram of heroin in and around Newark.
The plea agreements require both Wilson and Rutledge to be sentenced to 30 years in prison, minus time served in jail on related cases, and five years of supervised release. Sentencing is scheduled for Feb. 15, 2017.
U.S. Attorney Fishman credited special agents of the FBI and the FBI’s Safe Streets Task Force, under the direction of Special Agent in Charge Timothy Gallagher in Newark; the Essex County Prosecutor’s Office, under the direction of Acting Essex County Prosecutor Carolyn A. Murray; the Essex County Sheriff’s Office, under the direction of Sheriff Armando V. Fontoura; and the Newark Department of Public Safety, under the direction of Anthony F. Ambrose, with the investigation leading to today’s guilty pleas. He also thanked special agents of the Drug Enforcement Administration (DEA), under the direction of Special Agent in Charge Carl J. Kotowski; and special agents of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), under the direction of Special Agent in Charge George P. Belsky, for their roles in the investigation.
The government is represented by Assistant U.S. Attorney Anthony Mahajan of the U.S. Attorney’s Office Criminal Division in Newark.
Defense counsel:
Wilson: Michael N. Pedicini Esq., Chatham, New Jersey
Rutledge: Timothy R. Anderson Esq., Red Bank, New Jersey
Essex County, New Jersey, Man Charged with Defrauding Victim Invester Out of Hundreds of Thousands of DollarsRead the Press Release
NEWARK, N.J. – A North Caldwell, New Jersey, man was arrested this morning by FBI agents for fraudulently using funds that he solicited for bulk medical supply and consumer goods transactions, U.S. Attorney Paul Fishman announced.
Michael Esposito, 45, is charged by complaint with one count of wire fraud. He appeared this afternoon before U.S. Magistrate Judge Mark Falk in Newark federal court and was released on bail.
According to the complaint:
Esposito was the president of three companies that purported to be in the business of purchasing consumer products in bulk from manufacturers for resale to wholesalers and retailers.
In August 2013 Esposito told an individual referred to in the complaint as “Victim 1,” that Esposito had a customer that backed out of the purchase of medical supplies. Victim 1 was able to locate a buyer to whom Victim 1 could sell the goods for profit. However, after Victim 1 wired Esposito funds for the medical supplies, Esposito allegedly used the funds for unrelated expenses, including payments to apparent victim investors from prior transactions, restaurant bills, and salary for himself and others. Esposito also sent Victim 1 numerous fraudulent communications that the delivery of the medical supplies was imminent. Esposito never delivered the medical supplies to Victim 1.
During that time, Esposito also sent Victim 1 numerous emails detailing a series of investment opportunities in which Esposito would purchase consumer goods in bulk at substantial discounts. Esposito offered to give Victim 1 a significant profit from these deals in return for Victim 1’s investment. Again, Esposito used the funds for his own benefit instead of making the purported investments. He also sent Victim 1 emails and text messages falsely stating that certain deals were in progress or that problems with Esposito’s bank were preventing him from wiring funds to Victim 1.
Altogether, Victim 1 had more than $1 million wired to Esposito for the medical supplies and consumer goods transactions. During this time, Esposito caused approximately $517,000 to be sent by wire transfer to Victim 1, falsely representing that these funds were the return of principal and profits from successful deals. He converted the rest of the funds for his own use. Since January 2014, Esposito has ceased communicating with Victim 1.
The charge 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.
The charge and allegations contained in the complaint are merely accusations, and the defendant is considered innocent unless and until proven guilty.
U.S. Attorney Fishman credited special agents with the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation leading to the charges.
The government is represented by Assistant U.S. Attorney Andrew Kogan of the U.S. Attorney’s Office Economic Crimes Unit in Newark.
Defense counsel: Brooke M. Barnett Esq., Newark
U.S. Attorney's Office Reminds New Jersey Voters About Election Day Hotline for Complaints of Voting Irregularities or AbusesRead the Press Release
NEWARK, N.J. – U.S. Attorney Paul J. Fishman is reminding voters that the U.S. Attorney’s Office will receive and respond to reports of election irregularities, voter intimidation or any other activities that would interfere with a citizen’s right to vote on Nov. 8, 2016. The Election Day Hotline – (888) 636-6596 – will be active Nov. 7, 2016 through Nov. 9, 2016, and will be staffed live on Election day in English and in Spanish.
Each year the U.S. Attorney’s Office and its federal law enforcement partners, led by the FBI, work cooperatively with the New Jersey Attorney General’s Office and county boards of elections to respond to voter complaints and direct them to the appropriate authority.
The Justice Department seeks to ensure that all qualified voters have the opportunity to cast their ballots and have their votes counted, without discrimination, intimidation or fraud. Established in 2010, this yearly initiative is intended to foster public confidence in the integrity of the election process by providing local points of contact within the Justice Department for the public to report possible fraud and voting rights violations while polls are open on Election Day.
Federal law protects against such crimes as intimidating or bribing voters, buying and selling votes, impersonating voters, altering vote tallies, stuffing ballot boxes, and marking ballots for voters against their wishes or without their input.
It also contains special protections for voters so they can vote free from intimidation or harassment. For example, actions designed to interrupt or intimidate voters at polling places by questioning, challenging, photographing or videotaping them, under the pretext that these are actions to uncover illegal voting, may violate federal voting rights law. Further, federal law protects the right of voters to mark their own ballot or be assisted by a person of their choice.
The Department of Justice Civil Rights Division staff in Washington also will be available by phone to receive complaints related to voting rights (1-800-253-3931 toll free or 202-307-2767) or by TTY (202-514-0716). In addition, individuals may also report complaints, problems, or concerns related to voting by fax to 202-307-3961, by email to [email protected], and via complaint forms that may be submitted through a link on the Justice Department’s website, at http://www.justice.gov/crt/complaint/votintake/index.php.
La Oficina De La Fiscalía Federal Le Recuerda A Los Votantes De Nueva Jersey Que Pueden Usar La Línea Telefónica De Ayuda Electoral El Día De Las Elecciones Para Reportar Irregularidades O Abusos ElectoralesRead the Press Release
NEWARK, N.J. – El Fiscal Federal para el distrito de Nueva Jersey, Paul J. Fishman, le está recordando a los votantes de Nueva Jersey que la Oficina de la Fiscalía Federal para el distrito de Nueva Jersey estará dispuesta a recibir y a responder a reportes de irregularidades electorales, intimidación a los votantes y cualquieras otras actividades que puedan interferir con los derechos electorales de los ciudadanos el 8 de noviembre del 2016. La línea telefónica de ayuda electoral – (888) 636-6596 – estará activa desde el 7 de noviembre del 2016 hasta el 9 de noviembre del 2016 y será atendida en vivo el día de las elecciones en inglés y en español.
Cada año, la Oficina de la Fiscalía Federal para el distrito de Nueva Jersey, y otras agencias federales del orden público, encabezadas por el FBI, trabajan conjuntamente con la Oficina del Fiscal General de Nueva Jersey y las juntas electorales de los condados para responder a quejas electorales y dirigir las quejas a las autoridades apropriadas.
El Departamento de Justicia tiene por objeto garantizar que todos los votantes calificados tengan la oportunidad de emitir su voto y que sus votos cuenten, sin discriminación, intimidación o fraude. Fundada en el año 2010, esta iniciativa anual tiene como meta fomentar la confianza pública en la integridad del proceso electoral al proporcionar puntos de contacto locales dentro del Departamento de Justicia para que el público pueda reportar posibles violaciones de los derechos electorales y fraude electoral, mientras que las urnas estén abiertas el día de las elecciones.
La ley federal proteje a los cuidadanos contra crímenes electorales tales como la intimidación y el soborno de los votantes, la suplantación de votantes, la alteración de los lotes de votos, el relleno de las urnas electorales, y el marcar a las boletas para los votantes en contra de los deseos de los votantes y sin la participación de estos.
La ley también contiene protecciones especiales para los votantes para asegurar que estos puedan votar libre de intimidación o acoso. Por ejemplo, las acciones destinadas a interrumpir o intimidar a los votantes en los centros electorales, tal como cuestionando, desafiando, fotografiando o grabando los votantes, usando como pretexto que tales acciones son para descubrir actividades ilegales electorales, pueden en sí violar las leyes federales que protegen los derechos electorales. Además, la ley federal protégé el derecho de los votantes a marcar sus propias boletas o a ser asistidos para marcar sus boletas por una persona elegida por el votante.
El personal de la División de Derechos Civiles del Departamento de Justicia en Washington también estará disponible por teléfono para recibir denuncias relacionadas a los derechos electorales (1-800-253-3931 peaje gratis o 202-307-2767) o por TTY (202-514-0716). Además, las personas también pueden reportar quejas, problemas o inquietudes relacionadas con la votación por fax al 202-307-3961 , por correo electrónico a [email protected], y usando formularios de reclamaciones que puedan presentarse a través de un enlace en la página web del Departamento http://www.justice.gov/crt/complaint/votintake/index.php.
California Man Charged with Possessing with Intent to Distribute 27 Kilograms of MethamphetamineRead the Press Release
NEWARK, N.J. – A South Gate, California, man appeared in federal court today to face a drug distribution charge after he was arrested and found with 27 kilograms of methamphetamine hidden in a tractor trailer he was driving, U.S. Attorney Paul J. Fishman announced.
Tomas Lopez Beltran, 45, is charged by complaint with one count of possession with intent to distribute 500 grams or more of methamphetamine. He appeared before U.S. Magistrate Judge Joseph A. Dickson in Newark federal court and was detained. He was arrested Oct. 28, 2016 by agents of the Drug Enforcement Administration (DEA).
According to the complaint:
On Oct. 28, 2016, law enforcement performed a traffic stop of a tractor trailer in Woodbridge, New Jersey. The tractor trailer was driven by Beltran. During a lawful search, law enforcement recovered approximately 27 kilograms of methamphetamine from a concealed compartment inside the cab of the trailer.
The possession with intent to distribute charge carries a minimum penalty of 10 years in prison, a maximum potential penalty of life in prison and a $10 million fine.
U.S. Attorney Fishman credited special agents of the DEA, under the direction of Special Agent in Charge Carl J. Kotowski in Newark, with the investigation leading to the charges.
The government is represented by Assistant U.S. Attorney Karen D. Stringer and Mary Toscano, Chief of the General Crimes Unit of the U.S. Attorney’s Office in Newark.
Defense counsel: David Holman Esq., Assistant Federal Public Defender, Newar
Newark Man Charged with Possession of 25 Kilograms of Heroin and Eight Kilograms of Cocaine with Intent to DistributeRead the Press Release
NEWARK, N.J. – A Newark man was charged today with possession with intent to distribute illegal narcotics, U.S. Attorney Paul J. Fishman announced.
Wilfredo Rodriguez Escobar, 52, is charged by complaint with one count of possession with intent to distribute approximately 25 kilograms of heroin and approximately eight kilograms of cocaine, and one count of being a felon in possession of a firearm. He appeared today before U.S. Magistrate Judge Steven C. Mannion in Newark federal court and was detained without bail.
According to the complaint:
On Oct. 26, 2016, law enforcement arrested Rodriguez Escobar at his apartment after finding, pursuant to a search, a hidden compartment that contained heroin, cocaine, more than $300,000 in cash and a firearm.
The drug charge carries a mandatory minimum penalty of 10 years in prison, a maximum potential penalty of life, and a $10 million fine.
U.S. Attorney Fishman credited the Drug Enforcement Administration’s, New Jersey Division, under the direction of Special Agent in Charge Carl J. Kotowski, with the investigation leading to today’s charges.
The government is represented by Assistant U.S. Attorney Meredith Williams of the U.S. Attorney’s Office Narcotics/OCDETF Unit in Newark.
Defense counsel: Kevin Carlucci Esq., Assistant Federal Public Defender
Florida Man Pleads Guilty in Hacking, Spamming Scheme That Used Stolen Email AccountsRead the Press Release
NEWARK, N.J. – A Boca Raton, Florida, man today admitted his role in a computer hacking and identity theft scheme that generated $1.3 million in illegal profits by hijacking customer email accounts to send unsolicited “spam” emails, U.S. Attorney Paul J. Fishman and Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division announced.
Timothy Livingston, 31, pleaded guilty to Count One, Count Two, and Count Six of a superseding indictment charging him with conspiracy to commit fraud and related activity in connection with computers and access devices, conspiracy to commit fraud and related activity in connection with electronic mail, and aggravated identity theft. Livingston pleaded guilty today before U.S. District Judge William J. Martini 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.
Livingston admitted that beginning in January 2012, he solicited Tomasz Chmielarz, 33, 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 spam filters.
Livingston admitted that he then used these programs to transmit spam. In addition, Livingston used proxy servers and botnets to remain anonymous, hide the true origin of the spam, and evade anti-spam filters and other spam blocking techniques.
Livingston admitted that he 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 also admitted that he and Chmielarz 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.
Livingston also admitted that he used, without lawful authority, the username and password for an email account belonging to an actual customer of Corporate Victim 1 during the above-mentioned felony violations.
The charge of conspiracy to commit fraud and related activity in connection with computers and access devices carries a maximum potential penalty of five years in prison. The charge of conspiracy to commit fraud and related activity in connection with electronic mail carries a maximum potential penalty of three years in prison. The charge of aggravated identity theft carries a mandatory consecutive term of two years in prison. All three charges are punishable by a fine of $250,000, or twice the gross gain or loss from the offense.
Livingston also consented to the entry of a forfeiture money judgment in the amount of $1,346,442, as well as the forfeiture of property obtained using illegal proceeds from the scheme, including a 2009 Cadillac Escalade and a 2006 Ferrari F430 Spider.
Sentencing for Livingston is scheduled for Jan. 27, 2017. Chmielarz pleaded guilty for his role in the conspiracy on June 2, 2016 and awaits sentencing.
U.S. Attorney Fishman and Assistant Attorney General Caldwell 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 A. Hall, Jr., of the Criminal Division’s Computer Crime
Defense counsel: Lorraine Gauli-Rufo Esq., Verona, New Jersey
Union City, New Jersey, Inspector Sentenced to 20 Months in Prison for Conspiring to Rig Contractor Selection Process for Community Development ProjectsRead the Press Release
NEWARK, N.J. – An inspector at the Union City Community Development Agency (UCCDA) was sentenced today to 20 months in prison for conspiring with contractors to rig the selection process for home improvement, sidewalk replacement and other projects, causing losses of at least $307,000, U.S. Attorney Paul J. Fishman announced.
Johnny Garces, 53, of Union City, New Jersey, previously pleaded guilty before U.S. District Judge William H. Walls to an information charging him with one count of conspiring with others to obtain by fraud funds provided by Union City. Judge Walls imposed the sentence today in Newark federal court.
According to documents in this case and statements made in court:
Between April 2007 and July 2011, Garces was an inspector at the UCCDA, a government agency that receives funding from the U.S. Department of Housing and Urban Development (HUD) under a federal block grant that provides money for home improvement projects, sidewalk replacement and other projects.
From 2007 through 2011, Garces conspired with contractors Joseph Lado, 68, of Fort Lee, New Jersey, Leovaldo Fundora, 55, of Guttenberg, New Jersey, and others to rig the selection process for HUD-funded projects through false and misleading bids. In addition to instructing Lado and Fundora to submit phony, higher bids from competitors, Garces also fabricated higher bids from numerous fictitious companies so that Lado, Fundora and others would secure the projects.
In addition to the prison term, Judge Walls sentenced Garces to three years of supervised release and ordered him to pay restitution of $307,497.
Lado was sentenced Aug. 10, 2016, to three years of probation and ordered to pay $82,886 in restitution. Fundora was sentenced Aug. 17, 2016, to three years of probation and ordered to pay $73,754 in restitution.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher; and special agents of the U.S. Department of Housing and Urban Development, Office of Inspector General, under the direction of Special Agent in Charge Christina Scaringi, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney Barbara Llanes of the U.S. Attorney’s Office Special Prosecutions Division in Newark.
Maryland Man Admits Stealing Works of Art and Selling Them in Southern New JerseyRead the Press Release
CAMDEN, N.J. - A Rock Hall, Maryland, man today admitted stealing at least 40 pieces of art and bringing them to New Jersey to sell them, U.S. Attorney Paul J. Fishman announced.
William C. Reed III, 42, pleaded guilty before U.S. District Judge Robert B. Kugler in Camden federal court to an information charging him with one count of interstate transportation of stolen property.
According to documents filed in this case and statements made in court:
Starting in June 2013, Reed was employed as a caretaker for an individual in Rock Hall. Reed’s client was an art collector and dealer, who collected and maintained an eclectic collection of fine art by American and European artists. The collection included paintings, sculptures and etchings.
Between June 2014 and November 2014, Reed took various works of art from his client’s Rock Hall property without his permission and sold the art at various locations, including a pawn shop in Salem, New Jersey, and to an individual in Chestertown, Maryland.
The interstate transportation of stolen property charge to which Reed pleaded guilty carries a maximum potential penalty of 10 years in prison and $250,000 fine. Reed's sentencing is scheduled for Feb. 3, 2017.
U.S. Attorney Fishman credited special agents of the FBI’s Art Crime Team, under the direction of Special Agent in Charge Michael Harpster in Philadelphia, with the investigation leading to today’s plea. Fishman also thanked the Rock Hall Police Department, under the direction of Chief Steven W. Moore, for its assistance in this case.
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: Lisa Lewis Esq., Camden
Middlesex County, New Jersey, Man Admits Role InRead the Press Release
NEWARK, N.J. – A Middlesex County, New Jersey, man today admitted his role in a conspiracy to traffic approximately four kilograms of ethylone from China to New Jersey, U.S. Attorney Paul J. Fishman announced.
Thomas Seymore, 38, of Carteret, New Jersey, pleaded guilty before U.S. District Court Judge Katharine S. Hayden in Newark federal court to an indictment charging him with one count of conspiring to distribute ethylone, a Schedule I controlled substance.
According to documents filed in this case and statements made in court:
On June 10, 2014, Seymore conspired with others to possess with the intent to distribute approximately four kilograms of ethylone, which had been ordered from China and shipped to a location in Teaneck, New Jersey. Ethylone is an illegal synthetic drug that stimulates the nervous system and can cause hallucinogenic effects. Seymore was indicted by a federal grand jury on April 18, 2016, for his role in the drug trafficking conspiracy.
The conspiracy charge to which Seymore pleaded guilty carries a maximum potential penalty of 20 years in prison and a fine of up to $1 million. Sentencing is scheduled for Feb. 1, 2017.
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 Maria L. Kelokates.
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.
Former Assistant Vice President of Bank Sentenced to over Six Years in Prison for Embezzling More Than $1 MillionRead the Press Release
NEWARK, N.J. - A Bergen County, New Jersey, woman was sentenced today to 81 months in prison for embezzling more than $1 million while she worked at a bank in Fort Lee, New Jersey, U.S. Attorney Paul J. Fishman announced.
Miye Chon, a/k/a/ “Karen Chon,” 36, of Englewood Cliffs, New Jersey, previously pleaded guilty before U.S. District Judge William H. Walls to Counts One, Two, and 29 of a superseding indictment charging her with bank fraud, embezzlement or misapplication of funds by a bank officer or employee, and aggravated identity theft. Judge Walls imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
Chon was employed by BankAsiana, a federally insured financial institution, as an operations officer and later as an assistant vice president and operations officer at the Fort Lee branch until the bank was acquired by Wilshire Bank in October 2013. Chon had access to customer accounts and the bank’s internal account records, computer system and vault. Over several years, Chon stole more than $1 million from BankAsiana’s customer accounts by regularly making unauthorized transfers from customer certificate of deposit (CD) accounts into BankAsiana’s vault cash account and then physically removing cash from the bank’s vault.
Chon accomplished this scheme on dozens of occasions, typically taking tens of thousands of dollars at a time. One time, she converted $100,000 from a customer’s CD account. As part of the scheme, Chon also opened up a bank account in an individual’s name and forged checks using that individual’s name without permission.
In addition to the prison term, Judge Walls sentenced Chon to two years of supervised release and ordered her to pay restitution of $1,350,081.
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. Attorneys Daniel Shapiro and Lakshmi Srinivasan Herman of the U.S. Attorney’s Office’s Economic Crimes Unit.
Today’s sentencing is part of efforts underway by President 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. 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: Matthew Jeon Esq., Fort Lee, New Jersey
Firearms Dealer Gets over Five Years in Prison for Selling More Than 200 Guns to Drug Dealer, Other Criminals in South JerseyRead the Press Release
CAMDEN, N.J. – A Burlington County, New Jersey, man was sentenced today to 70 months in prison for selling to a Camden drug dealer and other criminals in the Camden area at least 200 firearms that he purchased with cash from other illicit firearms dealers, U.S. Attorney Paul J. Fishman announced.
Joshua Jackson, 36, a/k/a “Trent,” of Willingboro, New Jersey, previously pleaded guilty before U.S. District Judge Robert B. Kugler to an information charging him with one count each of dealing firearms without a license, conspiracy to deal in firearms without a federal firearms license, and possession of firearms by a convicted felon. Judge Kugler imposed the sentence today in Camden federal court.
According to documents filed in this and related cases and statements made in court:
Jackson admitted that between December 2009 and September 2010, he sold or brokered the sale of at least 200 handguns that he purchased with cash from illegal gun distributors in Ohio and from straw purchases made by his associates from gun stores in Columbus, Ohio.
Jackson sold many of the weapons to Terrance Laboo, 43, of Oaklyn, New Jersey. Laboo, who previously pleaded guilty in this matter, admitted that at the time he purchased these firearms, he was distributing PCP and cocaine from the corner of 4th and Chestnut Streets in Camden. Laboo also admitted that he sold, directed or brokered the sale of many of the firearms he purchased to other drug dealers in southern New Jersey.
Jackson obtained most of the firearms through purchases at gun shows from unlicensed gun sellers who were not subject to background checks. Some of the firearms also were purchased at Ohio gun stores by straw purchasers working for Jackson, who then transported the handguns to New Jersey from Ohio and resold them to Laboo and others in the Camden area.
Jackson transported the illegal firearms into the Camden area using a rental car or by having an associate transport them in duffel bags on Greyhound buses running between Columbus and bus terminals in Philadelphia and Mount Laurel, New Jersey.
In addition to the prison term, Judge Kugler sentenced Jackson to three years of supervised release.
U.S. Attorney Fishman credited special agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), under the direction of Special Agent in Charge George P. Belsky, with the investigation leading to today’s sentence. He also thanked the U.S. Attorney’s Office in the Southern District of Ohio, directed by U.S. Attorney Benjamin C. Glassman, and agents of the ATF Field Division in Columbus, under the direction of Acting Special Agent in Charge Bradley Earman for their assistance.
The government is represented by Assistant U.S. Attorney Patrick C. Askin of the U.S. Attorney’s Office Criminal Division in Camden.
Defense counsel: Justin Loughry Esq., Philadelphia
South Jersey Couple Sentenced for Conspiring to Set Fire to Historic DinerRead the Press Release
CAMDEN, N.J. – Two individuals from Cumberland County, New Jersey, were each sentenced today for planning to destroy a historic diner that they owned in Bridgeton, New Jersey, U.S. Attorney Paul J. Fishman announced.
Andrew Webster, 50, of Cedarville, New Jersey, was sentenced to 20 months in prison. His wife, Brenda Webster, 46, also of Cedarville, was sentenced to three years of probation, including six months of home confinement with electronic monitoring. Both defendants previously pleaded guilty before U.S. District Judge Robert B. Kugler to separate informations charging them each with one count of conspiracy to commit arson. Judge Kugler imposed both sentences today in Camden federal court.
According to documents filed in this case and statements made in court:
In March 2012, Andrew and Brenda Webster purchased and operated Angie’s Bridgeton Grill, a nearly 75-year old diner that was listed on the New Jersey and National Register of Historic Places in 2012.
Soon after they began to operate the diner, the Websters experienced several months of poor financial performance. During their plea hearings, Andrew and Brenda Webster admitted that they agreed to destroy the diner by fire. They also admitted that on Oct. 23, 2012, they traveled to the diner in Andrew’s truck.
According to the charges, in the early morning hours of Oct. 24, 2012, the Websters entered the diner, collected combustible materials (including newspapers, paper menus, and other light-weight combustible materials), doused them with gasoline, and ignited them with an open flame. Brenda Webster suffered burns to her body when gasoline vapors inside the diner ignited. The two quickly exited and within a short period of time, the fire destroyed the diner.
In addition to the prison term, Judge Kugler sentenced Andrew Webster to serve three years of supervised release. Both defendants are also responsible for restitution of $36,704.49.
U.S. Attorney Fishman credited the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), under the direction of Special Agent in Charge George P. Belsky; the Cumberland County Prosecutors Office, under the direction of Prosecutor Jennifer Webb-McRae; and the Bridgeton Police Department, under the direction of Chief Michael Gaimari, with the investigation.
The government is represented by Assistant U.S. Attorney Matthew T. Smith of the U.S. Attorney’s Office Criminal Division in Camden.
Defense counsel:
Andrew Webster: Richard Coughlin Esq., Assistant Federal Public Defender, Camden
Brenda Webster: Joseph Hoffman III Esq., Turnersville, New Jersey.
Former Watch Manufacturer Employee Gets A Year in Prison for Using False Invoicing Scheme to Steal Company MerchandiseRead the Press Release
TRENTON, N.J. –A former employee of a Bergen County, New Jersey, watch manufacturer was sentenced today to 12 months in prison for using phony documents and corporate records to defraud her employer out of hundreds of thousands of dollars of watches and watch parts, U.S. Attorney Paul J. Fishman announced.
Lissette Delarosa, 37, of Woodland Park, New Jersey, previously pleaded guilty before U.S. District Judge Michael A. Shipp to an information charging her with one count of mail fraud conspiracy. Judge Shipp imposed the sentence today in Trenton federal court.
According to documents filed in this case and statements made in court:
Delarosa admitted that from May 2003 through July 2010, she and Cynthia Alvarez, a/k/a “Cynthia Espejo,” 51, of Kissimmee, Florida, abused their positions in the watch manufacturer’s Bergen County customer service department to fraudulently obtain merchandise. Alvarez and Delarosa created hundreds of fictitious invoices, records, and customer complaints for watches and watch parts in their employer’s invoicing system and directed the merchandise to be sent to addresses they controlled. The watch manufacturer received no payment related to these invoices and no legitimate basis existed for providing the parts free of charge.
In addition to the prison term, Judge Shipp sentenced Delarosa to three years of supervised release and ordered her to forfeit $126,460.81.
Alvarez pleaded guilty to the same offense and was sentenced on July 8, 2016 to two years of probation.
U.S. Attorney Fishman credited postal inspectors with the U.S. Postal Inspection Service, under the direction of Inspector in Charge Maria L. Kelokates, Newark Division, with the investigation.
The government is represented by Assistant U.S. Attorney Svetlana M. Eisenberg of the U.S. Attorney’s Office Criminal Division in Newark.
Defense counsel: Alan D. Bowman, Esq., Newark, New Jersey
Essex County, New Jersey, Woman Sentenced to 92 Months in Prison for Leadership Role in Oxycodone Distribution RingRead the Press Release
NEWARK, N.J. – A Belleville, New Jersey, woman was sentenced today to 92 months in prison for her role in leading a conspiracy to illegally obtain and distribute oxycodone in New Jersey, U.S. Attorney Paul J. Fishman announced.
Victoria Horvath, 44, previously pleaded guilty before U.S. District Judge Esther Salas to an indictment charging her with conspiracy to distribute oxycodone. Judge Salas imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
Using confidential sources, physical surveillance, and recorded text messages and telephone calls, investigators with the Drug Enforcement Administration (DEA) discovered that members and suppliers of a drug trafficking organization secured prescriptions for oxycodone and other controlled substances from various doctors in New Jersey, filled them at pharmacies in Belleville and elsewhere, and sold the drugs for a profit. The investigation identified Victoria Horvath as a senior member of the drug trafficking organization.
Horvath admitted that, between Feb. 5, 2014 and Aug. 13, 2014, she personally went to various doctors’ offices and obtained prescriptions for pills containing oxycodone, had the prescriptions filled by various pharmacies, and sold the pills to members of the conspiracy and others. Horvath also drove other conspirators to specific doctors to obtain oxycodone prescriptions, assisted them in getting the prescriptions filled, and helped them sell the pills.
For example, Horvath admitted that she, while working with multiple conspirators, sold 119 oxycodone pills to an undercover law enforcement officer in February 2014 in exchange for $2,020. Horvath also admitted to being an organizer and manager of the conspiracy.
Oxycodone is a Schedule II controlled substance – meaning that it has a high potential for abuse, a currently accepted medical use with severe restrictions, and abuse of the drug may lead to severe psychological or physical dependence.
In addition to the prison term, Judge Salas sentenced Horvath to three years of supervised release.
Of the individuals originally charged with Horvath, Alexis Horvath, 27, of Belleville, New Jersey, Rickie Horvath, 54, Tony Marco, 47, and Steven Horvath, 45, all of Rutherford, New Jersey, and Justin Farraj, 24, and Matthew Policarpio, 28, of Newark, and Sabrina Vajda, 32, of Brooklyn, New York, have pleaded guilty and await sentencing. Brian Perez, 23, was sentenced to a term of 40 months in prison in September 2014. Luis Rivera, 25, was sentenced to 54 months in prison in August 2015. Daniel Horvath, 27, was sentenced to 27 months in prison in and Johnny Horvath, 46, was sentenced to 30 months in prison in April 2016. Monica Horvath, 22, was sentenced to 24 months in prison in August 2016. Charges were dismissed against Belleville pharmacist Vincent Cozzarelli after his death in April 2014. The indictment remains pending against two other conspirators.
U.S. Attorney Fishman credited the DEA’s New Jersey Division, under the direction of Special Agent in Charge Carl J. Kotowski, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney Sara F. Merin of the U.S. Attorney’s Office in Newark.
Defense counsel: Frank P. Arleo Esq., West Orange, New Jersey
Bronx, New York, Man Admits Role in Conspiracy to Possess with Intent to Distribute 22 Kilograms of Heroin in New JerseyRead the Press Release
TRENTON, N.J. – A Bronx, New York, man today admitted to 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., 21, pleaded guilty before U.S. District Judge Peter G. Sheridan in Trenton federal court to information charging him with one count of conspiracy to possess with intent to distribute more than one kilogram of heroin.
According to the documents filed in this case and statements made in court:
On Feb. 5, 2016, law enforcement observed a tractor-trailer, driven 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.
The count of conspiracy to possess with intent to distribute more than one kilogram of heroin carries a maximum potential penalty of 20 years in prison. Sentencing is scheduled for Jan. 30, 2017.
Co-defendants Mora and Gonzalez have pleaded guilty. Charges and allegations pending against the remaining defendants 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 guilty plea.
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
Six MS-13 Members Sentenced to over Five Years in PrisonRead the Press Release
NEWARK, N.J. – Six members of the international street gang “Mara Salvatrucha” (also known as MS-13) were each sentenced to over five years in prison for various racketeering crimes including extortion, drug distribution, and conspiracy to commit murder, U.S. Attorney Paul J. Fishman announced today.
Amilcar Romero, a/k/a “Chichi,” 47, of Los Angeles, and German Lisandro Benites-Moreno, “Raro,” 23, of Houston, were each sentenced today by U.S. District Court Judge Stanley R. Chesler to 60 months in prison. Marvin Garcia-Cruz, a/k/a “Buffalo,” 33, of West New York, New Jersey, was sentenced today by Judge Chesler to 108 months in prison. Romero previously pleaded guilty to one count of racketeering conspiracy. Benites-Moreno previously pleaded guilty to one count of racketeering conspiracy and one count of conspiracy to ship firearms while being an illegal alien. Garcia-Cruz previously pleaded guilty to one count of conspiracy to commit murder in aid of racketeering and one count of conspiring to possess firearms in furtherance of a crime of violence.
On Oct. 17, 2016, Hector Carranza-Solis, a/k/a “Blackie,” 32, of West New York, Luis Lopez-Guzman, a/k/a “Nino,” 26, of Union City, New Jersey, and Rudy Gutierrez, a/k/a “Chiqui,” 24, of Union City, were each sentenced by Judge Chesler to 60 months in prison. Carranza-Solis and Lopez-Guzman each pleaded guilty to one count of conspiracy to commit murder in aid of racketeering. Gutierrez pleaded guilty to one count of racketeering conspiracy.
According to documents filed in this case and statements made in court:
Romero and Joel Antonio Cortez, 42, a/k/a “Pee Wee,” of Los Angeles, served as the top deputies to Jose Juan Rodriguez-Juarez, 34, the alleged leader of MS-13’s “national program” which was an effort to bring all of local sets operating in the United States under a single, cohesive leadership structure.
By autumn 2013, Rodriguez-Juarez had assigned Romero to serve as the primary point-of-contact between the leadership of Mara Salvatrucha in the United States and El Salvador, while Cortez assumed responsibility for recruiting Mara Salvatrucha cliques on the east coast of the United States to join the national program. Both are also alleged to have ordered acts of violence, including Cortez’s authorization of the November 2013 murder plot in Hudson County and Romero’s order to east coast-based gang members to collect money on behalf of the gang by force and violence.
Romero and Cortez also collaborated with MS-13 gang leaders in New Jersey, Virginia, Maryland, and elsewhere to establish a distribution chain for cheap Mexican cartel drugs, including heroin and crystal methamphetamine. Part of the profit from that drug distribution chain would then be funneled back to the gang’s leadership in California to further promote the gang’s criminal activity.
Benites-Moreno, a Texas-based enforcer, admitted discussing the use of extortion and threats of violence to collect “rent” from other gang members. He also admitted that from Jan. 5, 2014 through July 18, 2014, he conspired with others to ship firearms from Texas to the east coast of the United States, including New Jersey.
Lopez-Guzman, Carranza-Solis, and Rudy Gutierrez were three members of the “Hudson Locotes Salvatruchas” MS-13 clique based in Hudson County. Garcia-Cruz was the leader of “Pinos Locos Salvatrucha,” another MS-13 clique based in Hudson County. All four admitted to their roles in a conspiracy to murder an MS-13 member who had violated the gang’s rules and the member’s brother, who was alleged to belong to a rival gang. They admitted that they participated in telephone calls and other discussions with the leadership of the gang in the United States and El Salvador – including Cortes – to seek permission to kill the rival gang members. Law enforcement learned of the murder plot during the course of the investigation and arrested the defendants before it could be completed.
Romero’s sentence will be served consecutively to a 44-year prison sentence imposed by California state court in 1997 for attempted murder.
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 investigation also involved substantial assistance from multiple FBI field offices, including the Los Angeles, California, office. U.S. Attorney Fishman also thanked the Hudson County Prosecutor’s Office, under the direction of Prosecutor Esther Suarez, and the Union County Prosecutor’s Office, under the direction of Acting Prosecutor Grace H. Park, for their work on this case. He also acknowledged the U.S. Attorney’s Office for the Central District of California for its assistance.
The government is represented by Assistant U.S. Attorneys James M. Donnelly and J. Jamari Buxton of the U.S Attorney’s Office Organized Crime/Gangs Unit in Newark.
Virginia Immigration Attorney Admits Visa Fraud, Obstruction of JusticeRead the Press Release
NEWARK, N.J. – An immigration attorney for two information technology companies today admitted that she submitted phony documents and obstructed a federal investigation as part of a scheme that fraudulently obtained foreign worker visas, U.S. Attorney Paul J. Fishman announced.
Sunila Dutt, 39, of Ashburn, Virginia, pleaded guilty before U.S. District Judge Kevin McNulty in Newark federal court to an information charging her with conspiracy to commit visa fraud and obstruct justice.
According to the information:
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. The U.S. Department of Homeland Security, U.S. Citizenship and Immigration Services (USCIS), approves and processes applications for residency within the United States, and the U.S. Department of Labor (USDOL) is responsible for the enforcement of labor regulations, including immigration-related employment standards and worker protections.
Dutt and other 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 USCIS, the conspirators falsely represented that the foreign workers had full-time positions and were paid an annual salary, as required to secure the H-1B 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.
In some instances, false payroll records were generated to create the appearance that the foreign workers were paid full-time wages. The conspirators required workers to pay SCM Data and MMC Systems their gross wages in cash. In exchange, the companies would issue payroll checks to the foreign workers in a smaller amount. 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 USDOL launched an audit of SCM Data and MMC Systems, the conspirators provided fabricated leave or vacation slips to USDOL for the time periods that the foreign workers were not working in order to conceal the fact that they were not paid during those time periods as required by federal law.
Dutt admitted that she submitted, or caused to be submitted, one or more filings to USCIS falsely representing the companies would employ foreign workers for in-house positions when no such positions existed. Dutt also admitted that on Oct. 16, 2014, MMC Systems, through her, and at the overall direction of the owner of both companies, submitted an I-129 Petition to USCIS to extend the H-1B visa status of a person referred to in the information as “Individual 1.”
In January 2015, MMC Systems stopped paying Individual 1 on a third-party contract. Dutt admitted that on Jan. 30, 2015, she told Individual 1 to falsely tell a person, whom she believed to be a USCIS employee, that Individual 1 had been living with a friend in Virginia or at a MMC Systems guesthouse. Dutt further admitted that on Feb. 2, 2015, she sent an e-mail to Individual 1 containing false information to be given to the USCIS employee as fictitious proof that Individual 1 resided at a MMC Systems guesthouse in January 2015.
Dutt faces a maximum potential penalty of five years in prison and a $250,000 fine. Sentencing is scheduled for Feb. 6, 2017.
U.S. Attorney Fishman credited special agents of U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI), under the direction of Special Agent in Charge Terence S. Opiola, and the U.S. Department of Labor, Office of Inspector General, under the direction of Special Agent in Charge Michael C. Mikulka, with the investigation leading to today’s plea.
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: Mitchell Epner, Esq.
Atlantic County, New Jersey, Man Sentenced to 33 Months in Prison for Possessing Child Pornography, Sending Lewd Image to A MinorRead the Press Release
CAMDEN, N.J. - An Egg Harbor Township, New Jersey, man was sentenced today to 33 months in prison for using online messaging applications to solicit nude photos from minors and transmit a lewd photo to a girl, U.S. Attorney Paul J. Fishman announced.
Zackary McFerren, 24, previously pleaded guilty before U.S. District Judge Jerome B. Simandle to an information charging him with one count of possession of child pornography and one count of transferring obscene matter to a minor. Judge Simandle imposed the sentence today in Camden federal court.
According to documents filed in this case and statements made in court:
McFerren admitted that between March 2015 and May 2015, he possessed multiple images of child pornography on his home computer. He also admitted that in April 2015, he used the “Kik” messaging application under the screen name “Emily” to communicate with a minor girl in the Philadelphia area. McFerren admitted that during the conversations, he asked the minor girl and her friend to take nude photographs of themselves and their genitalia. The girl then sent McFerren at least 14 such photographs.
In addition, McFerren admitted that in September 2015, he used Snapchat to send a picture of his penis to a Florida girl who was under the age of 16.
In addition to the prison term, Judge Simandle sentenced McFerren to five years of supervised release and fined him $2,000.
U.S. Attorney Fishman credited the FBI’s Child Exploitation Task Force, including special agents of the FBI’s Atlantic City Resident Agency, under the direction of Special Agent in Charge Timothy Gallagher in Newark, and detectives of the Atlantic County Prosecutor’s Office, under the direction of Prosecutor James P. McClain, with the investigation leading to today’s sentencing. He also thanked the FBI’s Philadelphia Division, the Egg Harbor Township Police Department and the Bay County, Florida, Sheriff’s Office for their assistance.
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: Edward Crisonino, Esq., Collingswood, New Jersey
Guilty Verdict Against Essex County, New Jersey, Man for Possessing Firearm as A Previously Convicted FelonRead the Press Release
NEWARK, N.J. – A Newark, New Jersey, man was convicted today by a federal jury of possessing a firearm as a previously convicted felon, U.S. Attorney Paul J. Fishman announced.
Lucas Sumler, 42, was convicted of possessing a firearm despite his previous conviction in U.S. District Court in New Jersey. Sumler was convicted today following a two-day trial before U.S. District Judge Esther Salas in Newark federal court.
According to documents filed in this case and the evidence at trial, on March 25, 2016, Sumler, was found in possession of a .357 magnum revolver along with six rounds of ammunition.
The charge of which Sumler was convicted carries a maximum potential penalty of 10 years in prison and a $250,000 fine. Sentencing is scheduled for Feb. 1, 2017.
U.S. Attorney Fishman credited special agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), under the direction of Special Agent in Charge George P. Belsky, along with the Newark Police Division, the Essex County Prosecutor’s Office and the Essex County Sheriff's Office, with the investigation leading to today’s guilty verdict.
The government is represented by Assistant U.S. Jonathan W. Romankow and Special Assistant U.S. Attorney Stephanie Raney of the U.S. Attorney’s Office Criminal Division in Newark.
Defense counsel: Michael N. Pedicini Esq., Chatham, New Jersey
Two Hudson County, New Jersey, Ms-13 Gang Members Charged with Conspiring to Kill Suspected InformantRead the Press Release
NEWARK, N.J. – Two Hudson County, New Jersey, men appeared in federal court today to face charges that they conspired to kill a gang member who was suspected of cooperating with law enforcement, U.S. Attorney Paul J. Fishman announced.
Juan Pablo Escalante-Melgar, a/k/a “Humilde,” 27, and Elmer Cruz-Diaz, a/k/a “Locote,” 28, both of Union City, New Jersey, were previously indicted on one count of conspiring to kill an individual to prevent them from communicating with a law enforcement officer. Escalante-Melgar and Cruz-Diaz were arraigned this afternoon before U.S. District Judge Claire C. Cecchi and were detained without bail. They were originally taken into custody on Sept. 3, 2015, on immigration charges.
According to documents filed in this case and statements made in court:
Escalante-Melgar and Cruz-Diaz are members of the international street gang Mara Salvatrucha, commonly known as “MS-13.” Multiple sub-sets, or “cliques,” of MS-13 operate in Hudson County, including Pinos Locos Salvatrucha (Pinos clique) and Hudson Locotes Salvatrucha (Hudson Locotes clique). Escalante-Melgar was the “First Word,” or leader, of the Pinos clique; Cruz-Diaz was the First Word of the Hudson Locotes clique.
MS-13’s rules strictly prohibit cooperating with law enforcement, and it is well understood within the gang that police informants will be punished by death. The process of obtaining authorization to kill a disobedient gang member is known as “green-lighting.” Obtaining a “green-light” typically requires the authorization of a clique leader and, in some cases, approval from gang leaders in California or El Salvador. When preparing to kill disloyal or disobedient gang members, MS-13 often assigns gang members to follow the targeted individuals to learn their patterns and movements, enabling the gang to carry out the murders at opportune times without alerting law enforcement.
On Aug. 11, 2015, law enforcement intercepted a telephone call between a high-ranking MS-13 member in El Salvador (Gang Leader 1), Escalante-Melgar, and another MS-13 member. Gang Leader-1 told Escalante-Melgar and the other MS-13 member that they needed to kill three individuals, including Victim 1, a member of the Hudson Locotes clique who was suspected of cooperating with law enforcement.
Four days later, law enforcement intercepted a telephone call between Cruz-Diaz and another MS-13 member in which Cruz-Diaz confirmed that senior MS-13 members in El Salvador had authorized a green-light on Victim 1, and went on to state that the gang would assign members of another MS-13 clique to “watch” Victim 1 in preparation for the killing. Cruz-Diaz told the other gang member, “the only thing left to do is to just do it.”
On Aug. 16, 2015, Escalante-Melgar spoke by telephone with another MS-13 member and confirmed that four individuals, including Victim 1, had been green-lighted. Escalante-Melgar explained to the other MS-13 member that the gang would take its time carrying out the murders in order to prevent gang members from being arrested.
On Aug. 31, 2015, Cruz-Diaz and Escalante-Melgar had separate telephone conversations with another member of MS-13, during which the MS-13 member informed Cruz-Diaz and Escalante-Melgar that he had seen Victim 1 on the street in Union City. Cruz-Diaz ordered the MS-13 member to follow Victim 1 to see what time Victim 1 left and returned home. Cruz-Diaz also informed the caller that another MS-13 member had been assigned to follow Victim 1. Escalante-Melgar acknowledged the information and instructed the caller to contact Escalante-Melgar with developments.
The conspiracy charge carries a maximum potential penalty of life in prison and a $250,000 fine.
The charge and allegations made in court documents are merely accusations, and the defendants are considered 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, Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), Newark Division, under the direction of Special Agent in Charge Terence S. Opiola, and ICE’s Enforcement and Removal Operations (ERO), under Newark Field Office Director John Tsoukaris, for the investigation leading to the charges. He also thanked the Hudson County Prosecutor’s Office, under the direction of Prosecutor Esther Suarez, the Union City Police Department, and the West New York Police Department for their work on the case.
The government is represented by Assistant U.S. Attorneys James Donnelly and Jamari Buxton of the U.S. Attorney’s Office Criminal Division in Newark as well as Trial Attorney Matthew Hoff with the Justice Department Criminal Division’s Organized Crime and Gang Section.
Defense counsel:
Escalante-Melgar: Frederick R. Dunne III Esq., Kearny, New Jersey
Cruz-Diaz: Perry Primavera Esq., Hackensack, New Jersey
New Jersey Man Charged with Stealing Employer’s ‘As Seen on TV’ Trade Secrets and Attempting to Sell Them to CompetitionRead the Press Release
NEWARK, N.J. – An employee of a privately-held corporation that distributes “As Seen On TV” products was arrested today and charged with theft of trade secrets and wire fraud, U.S. Attorney Paul J. Fishman announced.
Ralph Mandil, 37, of West Long Branch, New Jersey, was arrested by special agents of the FBI following a two-month sting operation in which he offered to sell to undercover agents inside information about his employer’s business. He is charged by complaint with one count of theft of trade secrets and one count of wire fraud. He will appear today before U.S. Magistrate Judge Michael A. Hammer in Newark federal court.
According to documents filed in this case and statements made in court:
The products sold by Mandil’s employer (Victim 1) include electrical and non-electrical appliances, beauty and personal care, pet care, fitness, auto and outdoor products, which are frequently marketed via television ads and are commonly sold at large retailers such as Walmart, generating substantial annual revenues.
Between Aug. 1, 2016, and Oct. 12, 2016, Mandil allegedly exchanged emails, phone calls and held meetings with people he believed were representatives of a New Jersey-based competitor of Victim 1. The individuals he was communicating with were, in fact, government agents outfitted with audio/video recording devices.
Throughout those communications, Mandil allegedly offered to provide the agents with proprietary trade secrets belonging to Victim 1, including unreleased product names, specifications, artwork, advertising, market data, manufacturing and other information, in addition to providing them with access to Victim 1’s “drop box,” or cloud storage account, in exchange for $197,500.
Mandil also allegedly provided the government agents with samples of the merchandise and trade secrets he could steal from Victim 1. During those exchanges Mandil confirmed that the proprietary information he was selling was worth “millions.” In exchange for these samples, Mandil was paid $10,000.
Law enforcement confirmed that if a competitor was able to preview this information before Victim 1 could release a product to the public, the competitor could use the market data and other proprietary information to obtain a tactical advantage over Victim 1 in the marketplace. A competitor could steal Victim 1’s product designs, undercut its prices and push competing products to retailers before Victim 1. Victim 1’s representatives estimated that the proprietary information Mandil was offering to sell was worth tens of millions of dollars in revenue to Victim 1 and its competitors.
The theft of trade secrets count with which Mandil is charged carries a maximum potential penalty of 10 years in prison. The wire fraud count with which Mandil is charged carries a maximum potential penalty of 20 years in prison.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher, with the investigation leading to the charges.
The government is represented by Assistant U.S. Attorney Adam N. Subervi of the U.S. Attorney’s Office Economic Crimes Unit in Newark.
The charges and allegations contained in the complaint are merely accusations and the defendants are presumed innocent unless and until proven guilty.
Former Monmouth County, New Jersey, Resident, Admits Collecting Dead Wife’s Monthly Benefit Checks for over Four YearsRead the Press Release
TRENTON, N.J. – A former Monmouth County, New Jersey, resident today admitted collecting Social Security disability checks paid to his wife for more than four years after she died, U.S. Attorney Paul J. Fishman announced.
Brian Unger, 64, formerly of Long Branch, New Jersey, and now a resident of Rincon, Puerto Rico, pleaded guilty before U.S. District Judge Freda L. Wolfson in Trenton federal court, to an information charging him with one count of theft of government money.
According to documents filed in this case and statements made in court:
In 2008, Unger’s wife applied to the Social Security Administration (SSA) for Disability Insurance Benefits due to illness which prevented her from working. The SSA maintains the program so eligible individuals who have serious physical or mental impairments are able to replace part of their lost earnings. In March 2008, the SSA determined that Unger’s wife was eligible for the program and began to electronically deposit money her bank account. She died in June 2009, but Unger failed to notify the SSA.
The SSA continued to issue direct deposits of benefit payments into Unger’s wife’s bank account through September 2013. Between June 2009 and October 2013, Unger accessed his deceased wife’s bank account on multiple occasions and used the funds deposited by the SSA on her behalf for his own personal expenses. He admitted that he took $82,854 in SSA benefits that had been improperly distributed to his deceased wife. He also admitted that he did not inform the SSA of his wife’s death because he wanted to continue to collect her disability benefits, which had been converted to Retirement Insurance Benefits in approximately May of 2013, when she would have turned 65, because he knew that informing the SSA of her death would have stopped the flow of those benefits.
The charge to which Unger pleaded guilty carries a maximum potential penalty of 10 years in prison and a fine of $250,000. Sentencing is scheduled for Jan. 18, 2017.
U.S. Attorney Fishman credited special agents of the Social Security Administration, Office of Inspector General, under the direction of Special Agent in Charge John F. Grasso, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Mark J. McCarren of the U.S. Attorney’s Office Special Prosecutions Division in Newark.
Defense counsel: Charles J. Uliano Esq., West Long Branch, New JerseyBergen County, New Jersey, Man Indicted on New Tax ChargesRead the Press Release
NEWARK, N.J. – A Bergen County, New Jersey, man who was charged in a scheme to defraud two international companies out of $3 million by fraudulently billing them for services that were never completed was indicted today on additional tax charges, U.S. Attorney Paul J. Fishman announced.
Philip Charles de Gruchy, 63, and Barbara Brown, 66, both of Park Ridge, New Jersey, were originally charged in February 2016 in a nine-count indictment with one count of conspiracy to commit mail fraud and eight counts of substantive mail fraud. The indictment handed up today adds six counts against de Gruchy, charging him with subscribing to false individual and corporate tax returns in 2009 and 2010, resulting in more than $800,000 taxes owed to the United States.
According to documents filed in this case and statements made in court:
From August 2007 through April 2, 2010, Brown was employed by “Company A,” a toy and juvenile products retailer headquartered in Wayne, New Jersey, first as director of customer relationship management and then as director of global customer relations management. She had authority to hire and pay contractors. Brown caused Company A to enter into a business relationship with CEM Inc., a company that Brown and de Gruchy secretly controlled. From Nov. 5, 2007, through March 4, 2010, CEM submitted approximately 170 invoices to Company A totalling more than $3 million for alleged marketing consulting work. The purported work was unnecessary, worthless, or never completed. Brown failed to disclose that she and De Gruchy had a financial interest in those invoice payments.
Although the checks that Company A issued to CEM were mailed to various Canadian addresses, the checks were ultimately deposited at bank branches located in Park Ridge, New Jersey. Checks were written out of the CEM account payable directly to either de Gruchy, Brown or two companies affiliated with de Gruchy: Silk Farm Inc. and Ontario LLC. Money obtained from the scheme was used for personal purposes, including home renovations, mortgage payments on the Park Ridge residence that Brown and de Gruchy shared, and credit card expenses.
From July 2010 through Nov. 11, 2011, de Gruchy was employed as the director of global relations management by “Company B,” an international manufacturer and retailer of luxury suitcases and accessories, headquartered in South Plainfield, New Jersey. He was responsible for a data migration project designed to assist Company B with identifying customer purchasing patterns. De Gruchy obtained verbal approval from Company B to hire Brown to assist him on the migration project. At no time did de Gruchy reveal his personal and financial relationship with Brown.
From November 2010 until November 2011, Brown submitted invoices in her own name or the name of her company, BI Insights, totaling more than $300,000 for purported work related to the data migration project. De Gruchy approved all of the invoices submitted by Brown and BI Insights. The work was alleged to be unnecessary, worthless, or never completed. Checks from Company B totaling $216,825 were sent to one of the Canadian addresses used to receive checks from Company A and were then deposited into a National Bank of Canada account held by Brown and De Gruchy.
Counts 10 and 11 of the superseding indictment charge de Gruchy with subscribing to false individual joint income tax returns for tax years 2009 and 2010. He allegedly intentionally overstated expenses and understated gross receipts, including receipts from the fraudulent conduct charged regarding Company A and Company B for those tax years, causing those returns to understate his total income for those years by $1.6 million.
De Gruchy is charged in Counts 12 and 13 of the superseding indictment with subscribing to false corporation tax returns for CEM for tax years 2009 and 2010. He allegedly falsely claimed certain business expenses payments, including payments made to “Individual 1,” which were then kicked back to de Gruchy, causing those business returns to understate CEM’s taxable income by $649,465 for those tax years.
De Gruchy is charged in Counts 14 and 15 of the superseding indictment with subscribing to false corporation tax returns for Silk Farm for tax years 2009 and 2010. He allegedly falsely claimed certain business expense payments, including payments made to Individual 1, which were then kicked back to de Gruchy, causing those business returns to understate Silk Farm’s taxable income by $377,578 for those tax years.
The counts of conspiracy to commit mail fraud and substantive mail fraud each carry a maximum potential penalty of 20 years in prison. The charges of subscribing to a false tax return each carry a maximum potential penalty of three years in prison. Each count of the indictment is punishable by a fine of $250,000 or twice the amount of the pecuniary gain or loss from the offense.
U.S. Attorney Fishman credited special agents of the FBI’s Newark Field Office, under the direction of Special Agent in Charge Timothy Gallagher and IRS-Criminal Investigations, Newark Field Office, under the direction of Special Agent Jonathan D. Larsen, with the investigation leading to the charges.
The government is represented by Senior Litigation Counsel Leslie F. Schwartz of the U.S. Attorney’s Office in Newark.
The charges and allegations contained in the indictment are merely accusations and the defendants are considered innocent unless and until proven guilty.
Defense counsel:
De Gruchy: Wanda Akin Esq., Newark
Brown: David B. Glazer Esq., Livingston, New Jersey
Downtown Newark Heroin and Oxycodone Dealer Gets 65 Months in Prison for Drug Distribution Conspiracy, Firearms OffensesRead the Press Release
NEWARK, N.J. – A Newark man was sentenced today to 65 months in prison for distributing large quantities of heroin and oxycodone in and around downtown Newark, U.S. Attorney Paul J. Fishman announced today.
Lamont Vaughn a/k/a “Mont,” a/k/a “True V,” 33, previously pleaded guilty before U.S. District Judge Jose L. Linares to Count One and Count Fourteen of an indictment charging him with conspiracy to distribute 100 grams or more of heroin and oxycodone and being a felon in possession of a firearm. Judge Linares imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
Between August 2012 and August 7, 2013, Vaughn conspired with others to distribute large quantities of heroin and oxycodone out of a downtown Newark clothing store called Ballas Boutique. Over the course of the conspiracy, Vaughn and others sold drugs out of Ballas Boutique to a confidential source more than 35 times. The majority of the sales were audio and video recorded.
Additionally, law enforcement intercepted conversations of Vaughn and his conspirators pursuant to court orders. The intercepted conversations revealed that Vaughn had multiple employees who sold drugs for him at Ballas Boutique. The intercepted conversations further revealed that Vaughn had multiple, established sources of supply for heroin and oxycodone.
On August 7, 2013, law enforcement officers executed arrest and search warrants at Ballas Boutique and at Vaughn’s home in Newark. When law enforcement officers announced their presence and entered Vaughn’s home, they found Vaughn attempting to flush drugs down the toilet. Among the items recovered from Vaughn’s bedroom were dozens of oxycodone pills, two firearms, and a large amount of cash.
In addition to the prison term, Judge Linares sentenced Vaughn to five 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, as well as the N.J. State Police Street Gangs North Unit with the investigation leading to the charges.
The government is represented by Assistant U.S. Attorneys Margaret Ann Mahoney and Francisco J. Navarro of the U.S. Attorney’s Office Criminal Division in Newark.
Defense counsel: Lamont Vaughn, Pro Se
Utah-Based Lender Agrees to Pay $4.25 Million to Resolve Alleged False Claims Act Liability Arising from FHA-Insured Mortgage LendingRead the Press Release
NEWARK, N.J. – A lender headquartered in Salt Lake City, Utah, has agreed to pay $4.25 million to resolve allegations that it violated the False Claims Act by originating and underwriting mortgage loans insured by the U.S. Department of Housing and Urban Development’s (HUD) Federal Housing Administration (FHA) that did not meet applicable requirements, U.S. Attorney Paul J. Fishman and the U.S. Department of Justice announced today.
As part of the settlement agreement, SecurityNational Mortgage Co. (SecurityNational) admitted it certified loans for FHA mortgage insurance that did not meet HUD underwriting requirements regarding borrower creditworthiness and eligibility.
Since at least January 2006, SecurityNational has participated as a Direct Endorsement Lender (DEL) in the FHA insurance program. A DEL has the authority to originate, underwrite, and endorse mortgages for FHA insurance. If a DEL approves a mortgage loan for FHA insurance and the loan later defaults, the holder of the loan may submit an insurance claim to HUD, FHA’s parent agency, for the losses resulting from the defaulted loan. Under the DEL program, the FHA does not review a loan before it is endorsed for FHA insurance for compliance with FHA’s credit and eligibility standards, but instead relies on the efforts of the DEL to verify compliance. DELs are therefore required to follow program rules designed to ensure that they are properly underwriting and certifying mortgages for FHA insurance.
“HUD relies on the Direct Endorsement Lenders like SecurityNational to make sure their loans are made only after a rigorous and thorough review,” U.S. Attorney Fishman said. “In this case, SecurityNational has admitted it approved loans that it had no business endorsing, potentially damaging a vital FHA program and other potential borrowers.”
“The FHA program provides important economic support for homeownership and community development,” Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division, said. “The Department has and will continue to ensure that program participants adhere to applicable requirements, and will pursue those that knowingly misuse the program for their own gain and to the detriment of homeowners and the public.”
SecurityNational admitted it endorsed loans that were not eligible for FHA mortgage insurance, including loans where:
- the borrower was delinquent on federal debt and had an unpaid court-ordered judgment;
- the borrower was four months delinquent on the underlying mortgage SecurityNational refinanced into an FHA loan;
- the mortgage loan amount exceeded HUD’s loan to value requirements;
- SecurityNational failed to document income used to qualify the borrower for FHA mortgage insurance; and
- SecurityNational failed to analyze the borrower’s delinquent credit history.
As a result of SecurityNational’s conduct and omissions, HUD insured loans endorsed by each lender that were not eligible for FHA mortgage insurance under the DEL program, and that HUD would not otherwise have insured. HUD subsequently incurred substantial losses when it paid insurance claims on those loans.
“Today’s settlements resolve allegations that these lenders, entrusted by American taxpayers to abide by FHA rules, failed to comply with certain FHA origination, underwriting and quality control requirements,” Inspector General David A. Montoya for HUD said. “The settlements demonstrate a continued commitment to address the failures and halt the business practices that potentially harm the FHA program and its participants.”
The settlement with SecurityNational is the result of a joint investigation conducted by HUD, the HUD Office of Inspector General, the Civil Division, and the U.S. Attorney’s Office for the District of New Jersey. The government is represented by Senior Litigation Counsel Anthony J. LaBruna and Assistant U.S. Attorney Mark Orlowski of the Civil Division of the U.S. Attorney’s Office for the District of New Jersey. A similar settlement in a case investigated by HUD, the HUD Office of Inspector General, the Civil Division, and the U.S. Attorney’s Office for the District of Colorado, was also announced today.
The claims asserted against SecurityNational are allegations only, and there has been no determination of liability.
U.S. Department of Justice Awards $13.7 Million to Hire Community Policing Officers in New JerseyRead the Press Release
NEWARK, N.J. – The U.S. Department of Justice, through its Office of Community Oriented Policing Services (COPS Office) COPS Hiring Program (CHP), awarded a total of $13,702,158 to New Jersey police departments for the purposes of creating, or in some cases protecting, 95 law enforcement positions dedicated to improving community policing efforts in the state, U.S. Attorney Paul J. Fishman announced.
The awards were part of $119 million in grants funds announced today by the U.S. Justice Department that were given to 184 law enforcement agencies across the nation. The New Jersey recipients include:
Agency Name
Award Amount
Officers Awarded
Asbury Park Police Department
$474,055
2
Camden County Police Department
$1,875,000
15
East Orange
$1,375,000
11
Essex County Sheriff's Office
$1,875,000
15
Borough of Fort Lee
$125,000
1
Township of Hamilton
$375,000
3
Hudson County Sheriff's Office
$1,500,000
12
Jersey City
$1,875,000
15
City of Orange Township
$1,408,050
6
City of Paterson
$2,820,053
15
CHP provides funding directly to state, local and tribal law enforcement agencies for the hiring and rehiring of entry-level career law enforcement officers in an effort to create and preserve jobs and increase community policing capacity and crime prevention efforts. All CHP applicants were asked to identify a specific crime and disorder problem area and how funding would be used to initiate or enhance their capacity to implement community policing approaches to that problem area.
In 2016, the COPS Office gave additional consideration to applicant agencies selecting the category of “Building Trust,” based on the final report of the President’s Task Force on 21st Century Policing. Additional consideration was also given to agencies that selected the areas of school-based policing, homicide or violent crime, and homeland security. Applicants who committed to hiring or rehiring at least one military veteran under CHP also received additional consideration for funding. The full list of recipients can be found here: http://www.cops.usdoj.gov/default.asp?Item=2888.
The COPS Office is a federal agency responsible for advancing community policing nationwide. Since 1995, COPS has invested over $14 billion to advance community policing, including grants awarded to more than 13,000 state, local, and tribal law enforcement agencies to fund the hiring and redeployment of approximately 129,000 officers and provide a variety of knowledge resource products including publications, training, and technical assistance.
Philadelphia Man Gets Two Years in Prison for Fradulently Exchanging over $1.2 Million in Food Stamp Benefits for CashRead the Press Release
CAMDEN, N.J. – A grocery store owner from Philadelphia was sentenced today to 24 months in prison for stealing more than $1.2 million through a food stamp scheme, U.S. Attorney Paul J. Fishman announced.
Kaher Abdullah, 58, previously pleaded guilty before U.S. District Judge Joseph H. Rodriguez to an information charging him with one count of theft of government funds. Judge Rodriguez imposed the sentence today in Camden federal court.
According to documents filed in this case and statements made in court:
In June 2011, Abdullah opened Express Food Mart on South Broadway in Camden. Express Food Mart was a small grocery store that was authorized to accept Supplemental Nutrition and Assistance Program (SNAP) benefits (formerly known as food stamps). The program is administered by the U.S. Department of Agriculture.
Abdullah admitted he controlled a business bank account at CitiBank to receive the reimbursements for SNAP benefits. He knew that as a SNAP retailer, he was not allowed to exchange food stamps for cash.
From Nov. 1, 2011 through October 2014, he and others under his supervision illegally permitted recipients of SNAP benefits to redeem those benefits at Express Food Mart for cash rather than food. Abdullah admitted that, in general, he and other employees redeemed SNAP benefits for approximately 50 cents on the dollar. He also admitted that from November 2011 through October 2014, Express Food Mart received through its Citibank business account approximately $1,264,006.47 for illegally redeemed SNAP benefits.
Abdullah admitted that shortly after receiving the money in the Express Food Mart account, he transferred the money to another account which he used to pay personal expenses.
In addition to the prison term, Judge Rodriguez ordered Abdullah to serve three years of supervised released and pay restitution of $1,264,006.
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 William G. Squires 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 Opiola.
The government is represented by Senior Litigation Counsel Jason M. Richardson of the U.S. Attorney’s Office Criminal Division in Camden.
Defense counsel: Justin Loughry Esq., Camden
Broker-Dealer Gets Three Years in Prison for Trading on Inside Information Stolen from Prominent Law FirmRead the Press Release
TRENTON, N.J. – A broker-dealer was sentenced today to 36 months in prison for participating in a five-year insider trading scheme that relied on information stolen from an international law firm and yielded net profits of more than $5.6 million, U.S. Attorney Paul J. Fishman announced.
Vladimir Eydelman, 44, formerly of Colts Neck, New Jersey, previously pleaded guilty before U.S. District Judge Michael A. Shipp to an information charging him with one count of conspiracy to commit securities and tender offer fraud, one count of securities fraud, and one count of tender offer fraud. Judge Shipp imposed the sentence today in Trenton federal court.
According to documents filed in this case and statements made in court:
From 2009 to 2013, Eydelman, a broker-dealer employed first by Oppenheimer & Co. and most recently by Morgan Stanley, repeatedly traded on material nonpublic information provided to him by his brokerage client, Frank Tamayo, 43, of Brooklyn, New York, who, in turn, had obtained the inside information from his friend and former law school classmate, Steven Metro, 42, of Katonah, New York. Metro was the managing clerk of the New York office of Simpson Thacher & Bartlett LLP, one of the nation’s premier mergers and acquisitions firms.
The inside information divulged by Metro to Tamayo and, in turn, by Tamayo to Eydelman, related to corporate transactions, such as mergers and acquisitions or tender offers, in which the law firm represented a party or financial advisor to the transaction. As the law firm’s managing clerk, a litigation-related function, Metro did not personally work on most of the corporate transactions at issue. In most instances, Metro stole the inside information from the firm by scouring its computer system using search terms such as “merger agreement,” “bid letter,” “engagement letter,” “due diligence,” as well as client names and client-matter numbers.
After obtaining the information, Metro divulged it to Tamayo in person, usually meeting at a bar, coffee shop, or other location near their respective workplaces in midtown Manhattan. During such meetings, Metro provided Tamayo inside information pertaining to, among other things, the names and/or ticker symbols of the companies whose securities should be purchased, the general timing of the planned deals, and information related to how the deals would affect the issuers’ stock price once announced. Tamayo generally would write the security’s ticker symbol on a small piece of paper or napkin and commit to memory any pricing or timing information provided by Metro.
After Tamayo received the inside information from Metro, Tamayo would meet with Eydelman, usually at a location near Eydelman’s workplace, such as under the large clock in New York City’s Grand Central Terminal, where Tamayo would pass it on to Eydelman. Tamayo would show Eydelman the paper or napkin on which Tamayo had written the ticker symbol of the company whose securities should be purchased. After Eydelman memorized the ticker symbol, Tamayo then would place the paper or napkin into his mouth and chew it until it was destroyed.
After receiving the inside information provided by Metro, whom Eydelman knew as Tamayo’s source at a law firm, Eydelman purchased securities for himself, family members, friends, and clients, including Tamayo. Eydelman quickly sold the shares and covered any positions once the relevant deal was publicly announced and the stock price rose.
Throughout the course of the five-year scheme, Tamayo reinvested the approximately $7,000 in profits that Metro made on the first deal and updated Metro on the running balance of his profits from the insider trading scheme. As of October 2013, by which time the conspirators had traded ahead of at least 13 planned corporate transactions, Metro’s share of the profits had reached approximately $168,000. Metro sought to cash out his share of the accrued profits from the insider trading scheme, pressing Tamayo to “liberate some cash” during a meeting in January 2014. Eydelman paid approximately $7,000 in cash to Tamayo in February 2014, with the expectation that Tamayo would use the cash to compensate Metro for providing them inside information.
By exploiting the information that Metro had stolen from the law firm, Eydelman and conspirators Metro and Tamayo netted more than $5.6 million in illicit profits.
In addition to the prison term, Judge Shipp sentenced Eydelman to three years of supervised release, fined him $15,000, and ordered him to forfeit $1,236,657.13.
Metro and Tamayo have both pleaded guilty to their roles in the scheme. On Sept. 14, 2016 Metro was sentenced to 46 months in prison. On Sept. 21, 2016, Tamayo was sentenced to 12 months in prison.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, for the investigation leading to today’s sentencing. He also thanked the U.S. Securities and Exchange Commission’s Market Abuse Unit, under the direction of Robert Cohen and Joseph Sansone.
The government is represented by Assistant U.S. Attorney Shirley U. Emehelu of the Special Prosecutions Division of the U.S. Attorney’s Office in Newark, and R. Joseph Gribko of the U.S. Attorney’s Office in Trenton, as well as Unit Acting Chief Barbara Ward and Assistant U.S. Attorney Jafer Aftab of the Office’s Asset Forfeiture and Money Laundering Unit.
These charges are part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorney’s 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 more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.Defense counsel: Walter F. Timpone Esq. and John P. Leonard Esq., Morristown, New Jersey
Two Newark Men Plead Guilty to Two Armed Carjackings and One Attempted Armed CarjackingRead the Press Release
NEWARK, N.J. – Two Newark men admitted today that they carried out two armed carjackings and one attempted carjacking during a five-day span in September 2013, U.S. Attorney Paul J. Fishman announced.
Dion Hines, 23, pleaded guilty before U.S. District Judge Katharine S. Hayden in Newark federal court to a four-count information charging him with attempted carjacking, carjacking (two counts), and using a firearm during a crime of violence. Roosevelt Robinson, 25, pleaded guilty to a three-count information charging him with attempted carjacking, carjacking, and using a firearm during a crime of violence.
According to documents filed in this case and statements made in court:
At 10:30 p.m. on Sept. 22, 2013, Hines, Robinson, and another male conspirator approached a Mercedes Benz sedan that was parked in a residential driveway in Newark. Hines brandished a silver revolver and ordered the driver to get out of the vehicle. Hines, Robinson, and the other conspirator pulled on the driver’s side door, but the victim resisted. Robinson said: “Shoot that [expletive].” The victim eventually got out of the Mercedes Benz and Robinson sat in the driver’s seat.
After Hines and the other conspirator fled on foot, the victim pulled Robinson from the Mercedes Benz, got back into the vehicle and reversed the car. Hines returned and fired two shots at the Mercedes Benz, striking the rear driver side door. Hines, Robinson, and the other conspirator then ran down the block and jumped into a car waiting nearby. The victim pursued them in the Mercedes Benz, striking both the getaway car and Robinson before Robinson entered the vehicle. A car chase ensued, during which Hines fired two additional shots at the Mercedes Benz.
At 9:25 p.m. on Sept. 26, 2013, Hines approached a vehicle parked in a lot near a Newark residence. After the driver exited the vehicle, Hines pointed a black revolver and stated: “Give me your car keys or I’ll shoot.” Around this time, another victim, who had just parked a late-model Acura sedan in the parking lot, walked over to where Hines and the other victim were standing. Hines then pointed the revolver at owner of the Acura and demanded the car keys. The owner of the Acura complied and Hines got into the car and fled.
At 4:45 a.m. on Sept. 27, 2013, a dark-colored SUV driven by an unknown person pulled in front of a Range Rover stopped at an intersection in Belleville, New Jersey, blocking the Range Rover’s path. Hines jumped out of the passenger side of the dark-colored SUV and pointed a black handgun at the victim. Robinson, who followed the dark-colored SUV in a separate vehicle, pulled over and stood watch. Hines approached the driver’s door, pulled the victim out of the vehicle, and demanded the car keys. The victim complied, and Hines then got into the Range Rover and fled, followed by the dark-colored SUV and Robinson’s vehicle.At 2:20 p.m. that day, law enforcement located the Range Rover in Newark. A brief car chase ensued, during which the Range Rover rammed multiple police vehicles before getting trapped and stopping. Law enforcement officers surrounded the Range Rover with their guns drawn. Hines and Robinson both exited the Range Rover and ran. Law enforcement officers arrested them shortly thereafter. The third occupant was taken into custody immediately. After arresting the three men, law enforcement officers searched the Range Rover and discovered a loaded black revolver in the vehicle.
The carjacking and attempted carjacking counts to which Hines and Robinson pleaded guilty each carry a maximum penalty of 15 years’ imprisonment and a fine of $250,000. The count of using a firearm during a crime of violence to which they pleaded guilty carries a mandatory minimum sentence of seven years in prison, a maximum sentence of life imprisonment, and a fine of $250,000. Sentencing for Hines is scheduled for Jan. 11, 2017, and for Robinson, Jan. 12, 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; and the Newark, Elizabeth, and Belleville police departments with the investigation leading to today’s guilty pleas.
The government is represented by Assistant U.S. Attorney J. Jamari Buxton of the U.S. Attorney’s Office Organized Crime/Gangs in Newark.
Grammy Award-Winning Songwriter and Producer Admits Failing to File Tax Returns on over $2.8 Million in IncomeRead the Press Release
NEWARK, N.J. – A singer, songwriter, and music producer from Fort Lee, New Jersey, today admitted that from 2008 through 2012, he knowingly failed to file tax returns on over $2.8 million in income, U.S. Attorney Paul J. Fishman announced.
Mario Winans, 42, pleaded guilty before U.S. District Judge Esther Salas in Newark federal court to Count One and Count Three of an information charging him with failing to file a tax return for tax years 2008 and 2010. Winans also admitted that he failed to file tax returns for 2009, 2011, and 2012, and this conduct will be taken into account at sentencing.
According to the documents filed in this case and statements made in court:
Winans produced songs and albums for various rhythm and blues, hip-hop, and dance music artists, including several artists on the “Bad Boy” record label. Winans acknowledged that he received royalty payments from checks payable to two companies that he controlled, Yellow City LLC and RioWorld LLC. Winans admitted that despite earning more than $2.8 million from 2008 through 2012, he willfully failed to file tax returns for each of those years, resulting in a tax loss of $434,968.
Winans faces a maximum sentence of two years in prison and a $200,000 fine, or twice the gross gain or loss from the offense. Pursuant to the terms of the plea agreement, Winans must also pay restitution of $434,968 to the IRS. Sentencing is scheduled for Jan. 24, 2017.
Judge Salas set bail at $250,000 and permitted Winans’s release pending sentencing.
U.S. Attorney Fishman credited special agents with IRS-Criminal Investigation, Newark Field Office, under the direction of Special Agent in Charge Jonathan D. Larsen, with the investigation leading to today’s plea.
The case is being prosecuted by Assistant U.S. Attorney Joseph Mack, Deputy Chief of the U.S. Attorney’s Healthcare and Government Fraud Unit.
Defense counsel: Aidan P. O’Connor, Hackensack, New Jersey
Doctor Sentenced to One Year in Prison for Accepting Thousands of Dollars in Cash Bribes for ReferralsRead the Press Release
CAMDEN, N.J. – A doctor with offices in Toms River, New Jersey, was sentenced today to 12 months and one day in prison for accepting thousands of dollars in exchange for patient referrals to two lab companies that performed blood and DNA testing, U.S. Attorney Paul J. Fishman announced.
Vincent Destasio, 55, of Toms River, previously pleaded guilty before U.S. District Judge Joseph H. Rodriguez to an indictment charging him with one count of conspiracy to accept cash bribes. Judge Rodriguez imposed the sentence today in Camden federal court.
According to documents filed in this case and statements made in court:
Destasio, a doctor of osteopathic medicine, was paid cash kickbacks by two sales representatives – Daniel Gilman, 63, of Ocean Grove, New Jersey, and Kenneth Robberson, 47, of Wall, New Jersey – who were partners operating PROMED, a marketing and sales company specializing in blood testing laboratories and DNA laboratory testing companies.
From March 2014 through May 2015, Gilman and Robberson solicited Destasio by paying him cash bribes for referring patient lab work to two separate laboratories for which Gilman and Robberson provided marketing and sales. One company (Company 1) was a blood testing laboratory company and the other was a DNA laboratory testing company (Company 2). Neither Company 1 nor Company 2 had any knowledge of or involvement in the kickback scheme.
Gilman and Robberson received monthly commission checks from the two companies for referrals. After receiving the commission checks from the two companies, Gilman and Robberson would identify the number of patients Destasio had referred and pay him a cash kickback based on those patients. Destasio was paid thousands of dollars in cash bribes for his referrals.
In addition to the prison term, Judge Rodriguez sentenced Destasio to two years of supervised release, fined him $1,000 and entered a forfeiture judgment of $25,000.
Gilman and Robberson have both pleaded guilty to an information charging them with conspiracy to bribe a physician. Gilman was sentenced Sept. 28, 2016, to 12 months and one day in prison. Robberson is scheduled to be sentenced Oct. 5, 2016.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, and 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, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney R. David Walk Jr. of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Camden.
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 $1.29 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: John J. Bruno Jr. Esq., Rutherford, New Jersey
Philadelphia Man Sentenced to Eight Years in Prison for Sex Trafficking 15-Year-Old GirlRead the Press Release
TRENTON, N.J. – A Philadelphia man was sentenced today to 96 months in prison for sex trafficking a 15-year-old girl, U.S. Attorney Paul J. Fishman announced.
Samuel Verrier, 38, aka “Dre,” previously pleaded guilty before U.S. District Judge Michael A. Shipp to an information charging him with one count of procuring the interstate travel of a person to engage in illicit sexual conduct for the purpose of financial gain. Judge Shipp imposed the sentence in Trenton federal court.
According to the documents filed in this case and statements made in Court:
For approximately two weeks in August 2011, Verrier engaged a 15-year-old girl in prostitution, acting as her pimp. He brought her to various bars and strip clubs, supplied her with drugs and alcohol, and instructed her to have sex with club patrons in exchange for money. On Sept. 1, 2011, Verrier and his co-defendant, Karl Venord, drove the girl from Philadelphia to Bordentown, New Jersey, so that they could use her in an extortion scheme. They directed her to approach a man in a parking lot, seduce him, take pictures of the sexual encounter, and provide those pictures to Verrier and Venord, who would use the pictures to blackmail the man. The scheme went awry when the man declined the girl’s advances and a witness called the police.
In addition to the prison sentence, Judge Shipp sentenced Verrier to a lifetime term of supervised release, the provisions of which restrict his contact with minors, and ordered him to pay $60,000 in restitution to the victim, as well as a $5,000 fine.
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 N.J. Division of Criminal Justice also provided assistance.
The government is represented by Assistant U.S. Attorneys Sarah M. Wolfe, Molly S. Lorber, and R. Joseph Gribko of the U.S. Attorney’s Office Criminal Division in Trenton.
Defense counsel: Paul Casteleiro Esq., West Trenton, New Jersey
Monmouth County, New Jersey, Sales Representative Sentenced to One Year in Prison for Paying $25,000 in Cash Bribes for Patient ReferralsRead the Press Release
CAMDEN, N.J. – The owner of a marketing and sales company who admitted paying thousands of dollars in cash bribes to a New Jersey physician in return for patient referrals to his clients was sentenced today to 12 months and one day in prison, U.S. Attorney Paul J. Fishman announced.
Daniel Gilman, 63, of Ocean Grove, New Jersey, previously pleaded guilty before U.S. District Judge Joseph H. Rodriguez to an information charging him with one count of conspiracy to pay kickbacks. Judge Rodriguez imposed the sentence today in Camden federal court.
According to documents filed in this case and statements made in court:
Gilman was a principle of Promed Practice Consultants LLC (Promed), a company specializing in marketing and sales services for testing laboratories. As identified in the information, “Company 1,” a blood testing laboratory, and “Company 2,” a DNA testing laboratory, were two of Promed’s clients. Gilman received monthly commission checks from Company 1 and Company 2 for referrals, which were equal to 10 percent of the reimbursements paid to the companies by various payers, including Medicare.
From March 2014 through May 2015, Gilman paid a physician, Vincent Destasio, 54, of Toms River, New Jersey, thousands of dollars in return for patient lab referrals to Company 1 and Company 2. After receiving the commission checks from Company 1 and Company 2, Gilman would identify Destasio’s patient referrals to those companies and pay him corresponding kickbacks in cash.
Neither Company 1 nor Company 2 had any knowledge of or involvement in the kickback scheme.
In addition to the prison term, Judge Rodriguez sentenced Gilman to two years of supervised release, fined him $1,000, and entered a forfeiture judgment of $25,000. Destasio pleaded guilty on June 23, 2016, to an indictment charging him with one count of conspiracy to accept cash bribes and is scheduled to be sentenced Sept. 29, 2016.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher, 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 investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney R. David Walk Jr. of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Camden.
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 $1.3 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: Vincent C. Scoca Esq., Bloomfield, New Jersey
Two Recruiters Admit Scheme to Fraudulently Maintain Immigration Status, Obtain Work Authorizations for Foreign Clients Through “Pay to Stay” New Jersey CollegeRead the Press Release
NEWARK, N.J. – Two employees from a Somerset County, New Jersey, company today admitted recruiting foreign nationals to enroll at a “pay to stay” New Jersey college where they could fraudulently maintain their clients’ student visa status and get them full-time work authorizations without the clients having to attend classes, U.S. Attorney Paul J. Fishman announced.
Harpreet Sachdeva, 26, of Somerset, New Jersey, and Sanjeev Sukhija, 35, of North Brunswick, New Jersey, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to separate informations charging them each with one count of conspiracy to commit visa fraud.
On April 5, 2016, 22 brokers, recruiters, and employers, including Sachdeva and Sukhija, were charged with enrolling foreign nationals in the University of Northern New Jersey, a purported for-profit college located in Cranford, New Jersey (UNNJ). UNNJ was created in September 2013 by Homeland Security Investigations (HSI). It was not staffed with instructors or educators, had no curriculum, and conducted no actual classes or education activities. It operated solely as a storefront location staffed by federal agents posing as school administrators.
According to the documents filed in this case and statements made in court:
Sachdeva and Sukhij – Indian citizens who are present in the United States on foreign worker visas – were each employed at Right OPT, a purported international student recruiting and consulting company located in Somerset, New Jersey. Sachdeva was Right OPT’s business development, marketing, and operations manager. Sukhija was the company’s business development manager.
UNNJ represented itself as a school that, among other things, was authorized to issue a document known as a “Certificate of Eligibility for Nonimmigrant (F-1) Student Status - for Academic and Language Students,” commonly referred to as a Form I-20. This document, which certifies that a foreign national has been accepted to a school and would be a full-time student, typically enables legitimate foreign students to obtain an F-1 student visa. With the visa, they can enter or remain in the United States while they make normal progress toward the completion of a full course of study at a Student and Exchange Visitor Program (SEVP) accredited institution.
Sachdeva and Sukhija told Right OPT’s foreign recruits that for a fee, they could enroll at UNNJ without having to attend any classes and that their enrollment would enable them to fraudulently maintain their nonimmigrant status. With full knowledge that the recruits were not bona fide students and would not attend any courses, earn credits, or make academic progress toward any legitimate degree at UNNJ, Sachdeva and Sukhija caused Forms I-20 to be issued to the foreign nationals.
Sachdeva and Sukhija also caused the foreign nationals to be reported in government databases as legitimate foreign students. In order to deceive immigration officials, Sachdeva, Right OPT’s foreign clients, and others obtained and created fraudulent student documents, including attendance records and transcripts.
After enabling them to maintain their student visa status, Sachdeva and Sukhija also conspired to secure fraudulent work authorizations for some of their foreign clients. Both defendants admitted that their intention was to profit from the scheme by outsourcing these foreign individuals through Right OPT as information technology consultants with various businesses in the United States for commissions. In total, Sachdeva, Sukhija and others fraudulently maintained and attempted to obtain approximately 45 student visas and/or work authorizations.
The conspiracy to commit visa fraud charge carries a maximum penalty of five years in prison and a $250,000 fine. Sentencing for Sachdeva and Sukhija is scheduled for Jan. 12, 2017 and Jan. 10, 2017, respectively.
U.S. Attorney Fishman credited special agents of U.S. Immigration and Customs Enforcement, under the leadership of Director Sarah R. Saldaña; HSI Newark, under the leadership of Special Agent in Charge Terence S. Opiola; U.S. Immigration and Customs Enforcement, Counterterrorism and Criminal Exploitation Unit, under the leadership of Unit Chief Robert Soria; U.S. Citizenship and Immigration Services, Fraud Detection and National Security Section, under the leadership of Associate Director Matthew Emrich; the Student and Exchange Visitor Program, under the leadership of Deputy Assistant Director Louis M. Farrell; U.S. Citizenship and Immigration Services, Vermont Service Center, Security Fraud Division, under the leadership of Associate Center Director Bradley J. Brouillette; U.S. Department of State, Bureau of Consular Affairs, Office of Fraud Prevention Programs, under the leadership of Director Josh Glazeroff; and the FBI, Joint Terrorism Task Force, under the leadership of Timothy Gallagher in Newark, for their contributions to the investigation.
He also thanked the Accrediting Commission of Career Schools and Colleges (ACCSC), under the leadership of Executive Director Michale S. McComis, and the N.J. Office of Higher Education, under the leadership of Secretary of Higher Education Rochelle R. Hendricks, for their assistance. In addition, U.S. Attorney Fishman thanked the N.J. Motor Vehicle Commission and the New York State Department of Motor Vehicles, as well as the U.S. Attorney’s Offices for the Central District of California, Eastern District of New York, Eastern District of Virginia, Southern District of New York, Central District of Illinois, Peoria Division, and the Northern District of Georgia for their help.
The government is represented by Assistant U.S. Attorney Dennis C. Carletta of the U.S. Attorney’s Office National Security Unit, and Sarah Devlin of the Office’s Asset Forfeiture and Money Laundering Unit.
Defense Counsel (Sachdeva): Anthony Gualano, Esq., McAfee, New Jersey
Defense Counsel (Sukhija): David Oakley, Esq., Princeton, New Jersey
Associate of Decavalcante Crime Family Sentenced to More Than Two Years in Prison for Distributing CocaineRead the Press Release
NEWARK, N.J. – An associate of the DeCavalcante organized crime family of La Cosa Nostra was sentenced today to 30 months in prison for his role in distributing more than 500 grams of cocaine, U.S. Attorney Paul J. Fishman announced.
John Capozzi, 36, of Union, New Jersey, previously pleaded guilty before U.S. District Judge William H. Walls to an information charging him with one count of distribution of more than 500 grams of cocaine. Judge Walls imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
Capozzi was arrested and charged by complaint in March 2015, along with nine members of the DeCavalcante crime family. He admitted that between Dec. 12, 2014 and March 2015, in conjunction with other family associates, he sold more than one-half a kilo of cocaine to an undercover FBI agent for at least $78,000.
In addition to the prison term, Judge Walls sentenced Capozzi to two 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; the N.J. State Commission of Investigation, under the direction of Acting Executive Director Lee C. Seglem; the Waterfront Commission of New York Harbor, under the direction of Executive Director Walter M. Arsenault; and the Union County Prosecutor’s Office, under the direction of Acting Union County Prosecutor Grace H. Park, with the investigation leading to today’s sentencing.
The government is represented by Senior Litigation Counsel V. Grady O’Malley of the U.S. Attorney’s Office’s Organized Crime/Gangs Unit.
Defense counsel: Neil G. Duffy III Esq., Union, New Jersey
Owner of Information Technology Companies Arrested for Visa Fraud, Obstruction of Justice, and Harboring Foreign WorkersRead the Press Release
Two Companies and an Employee Also Charged in Indictment
NEWARK, N.J. – A New York man was arrested this morning pursuant to an indictment charging him, two information technology companies that he partly owns, and an employee with fraudulently using the H-1B visa program to reduce skilled labor costs, U.S. Attorney Paul J. Fishman announced today.
Sowrabh Sharma, 31, of New York, is charged – along with SCM Data Inc., a New Jersey corporation, MMC Systems Inc., a Virginia corporation, and Shikha Mohta, 33, of Jersey City, New Jersey, the head of finance for the companies – with one count of conspiracy to commit visa fraud and to obstruct justice and one count of conspiracy to harbor aliens.
Sharma is scheduled to make his initial appearance this afternoon before U.S. Magistrate Judge Cathy L. Waldor in Newark federal court. Mohta was previously arrested in May 2015 on a criminal complaint and was released on a $100,000 bond.
According to the indictment unsealed today:
SCM Data and MMC Systems 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. The U.S. Department of Homeland Security, U.S. Citizenship and Immigrations Services (USCIS) was empowered to approve and process applications for residency within the United States, and the U.S. Department of Labor (USDOL) was charged with the enforcement of the requirements of labor regulations, including immigration-related employment standards and worker protections.
SCM Data, MMC Systems, Sharma, Mohta and other 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 USCIS, the conspirators falsely represented that the foreign workers had full-time positions and were paid an annual salary, as required to secure the H-1B visas. Contrary to these representations and in violation of the H-1B program, SCM Data, MMC Systems, Sharma, Mohta, and others 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.
In some instances, SCM Data, MMC Systems, Sharma, Mohta, and others generated false payroll records to create the appearance that the foreign workers were paid full-time wages. The conspirators required workers to pay SCM Data or MMC Systems their gross wages in cash. In exchange, SCM Data or MMC Systems would issue payroll checks to the foreign workers in a smaller amount. 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 SCM Data and MMC Systems.
Once USDOL launched an audit of SCM Data and MMC Systems, the conspirators provided fabricated leave or vacation slips to USDOL for the time periods that the foreign workers were not working in order to conceal the fact that they were not paid during those time periods as required by federal law.
The visa fraud and obstruction of justice conspiracy charge carries a maximum potential penalty of five years in prison and a $250,000 fine. The alien harboring conspiracy charge carries a maximum penalty of 10 years in prison and a $250,000 fine.
U.S. Attorney Fishman credited 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 S. 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 leading to the charges.
The government is represented by Assistant U.S. Attorneys Anthony Moscato and Joyce M. Malliet of the U.S. Attorney’s Office’s National Security Unit in Newark.
The charges and allegations contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Defense Counsel (Sharma): John P. Lacey Esq.
Defense Counsel (Mohta): Daniel Bibb Esq.
Four Chinese Nationals and China-Based Company Charged with Using Front Companies to Evade U.S. Sanctions Targeting North Korea’s Nuclear Weapons and Ballistic Missile ProgramsRead the Press Release
Four Chinese nationals and a trading company based in Dandong, China, were charged by criminal complaint unsealed today with conspiring to evade U.S. economic sanctions and violating the Weapons of Mass Destruction Proliferators Sanctions Regulations (WMDPSR) through front companies by facilitating prohibited U.S. dollar transactions through the United States on behalf of a sanctioned entity in the Democratic People’s Republic of Korea (North Korea) and to launder the proceeds of that criminal conduct through U.S. financial institutions.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Assistant Attorney General for National Security John P. Carlin, U.S. Attorney Paul J. Fishman of the District of New Jersey and Assistant Director E.W. Priestap of the FBI’s Counterintelligence Division made the announcement.
On Aug. 3, 2016, a U.S. Magistrate Judge Joseph A. Dickson of the District of New Jersey signed a criminal complaint charging Ma Xiaohong (Ma) and her company, Dandong Hongxiang Industrial Development Co. Ltd. (DHID), and three of DHID’s top executives, general manager Zhou Jianshu (Zhou), deputy general manager Hong Jinhua (Hong) and financial manager Luo Chuanxu (Luo), with conspiracy to violate the International Emergency Economic Powers Act (IEEPA) and to defraud the United States; violating IEEPA; and conspiracy to launder monetary instruments.
Today, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) also imposed sanctions on DHID, Ma, Zhou, Hong and Luo for their ties to the government of North Korea’s weapons of mass destruction proliferation efforts.
In addition, the department filed a civil forfeiture action for all funds contained in 25 Chinese bank accounts that allegedly belong to DHID and its front companies. The department has also requested tha the federal court in the District of New Jersey issue a restraining order for all of the funds named in the civil forfeiture action, based upon the allegation that the funds represent property involved in money laundering, which makes them forfeitable to the United States. There are no allegations of wrongdoing by the U.S. correspondent banks or foreign banks that maintain these accounts.
“The charges and forfeiture action announced today allege that defendants in China established and used shell companies around the world, surreptitiously moved money through the United States and violated the sanctions imposed on North Korea in response to, among other things, its nuclear weapons program,” said Assistant Attorney General Caldwell. “The actions reflect our efforts to protect the integrity of the U.S. banking system and hold accountable those who seek to evade U.S. sanctions laws.”
“The charges unsealed today reflect our nation’s commitment to using all tools to deter and disrupt weapons of mass destruction proliferators,” said Assistant Attorney General Carlin. “One of the strengths of our sanctions programs is that they prevent sanctioned wrongdoers from engaging in U.S. dollar transactions. Denying the use of the U.S. financial system can greatly curtail illegal activities and disrupt efforts to provide weapons of mass destruction to terrorists and rogue nations. Those who seek to evade our financial sanctions will be fully prosecuted, and we will be unflagging in our efforts to bring them to justice.”
“The FBI takes violations of these laws extremely seriously and will not hesitate to use our full investigative resources to stop this type of illegal activity,” said Assistant Director Priestap. “In this case agents, analysts and forensic accountants from field offices in Phoenix and Newark, as well as FBI Headquarters, all contributed to a successful investigation.”
According to criminal and civil complaints, DHID is primarily owned by Ma and is located near the North Korean border. DHID allegedly openly worked with North Korea-based Korea Kwangson Banking Corporation (KKBC) prior to Aug. 11, 2009, when the OFAC designated KKBC as a Specially Designated National (SDN) for providing U.S. dollar financial services for two other North Korean entities, Tanchon Commercial Bank (Tanchon) and Korea Hyoksin Trading Corporation (Hyoksin). President Bush identified Tanchon as a weapons of mass destruction proliferator in June 2005, and OFAC designated Hyoksin as an SDN under the WMDPSR in July 2009. Tanchon and Hyoksin were so identified and designated because of their ties to Korea Mining Development Trading Company (KOMID), which OFAC has described as North Korea’s premier arms dealer and main exporter of goods and equipment related to ballistic missiles and conventional weapons. The United Nations (UN) placed KOMID, Tanchon and Hyoksin on the UN Sanctions List in 2006. In March 2016, KKBC was added to the UN Sanctions List.
In August 2009, Ma allegedly conspired with Zhou, Hong and Luo to create or acquire numerous front companies to conduct U.S. dollar transactions designed to evade U.S. sanctions. The complaints allege that from August 2009 to September 2015, DHID used these front companies, established in offshore jurisdictions such as the British Virgin Islands, the Seychelles and Hong Kong, and opened Chinese bank accounts to conduct U.S. dollar financial transactions through the U.S. banking system when completing sales to North Korea. These sales transactions were allegedly financed or guaranteed by KKBC. These front companies facilitated the financial transactions to hide KKBC’s presence from correspondent banks in the United States, according to the allegations in the complaints.
As a result of the defendants’ alleged scheme, KKBC was able to cause financial transactions in U.S. dollars to transit through the U.S. correspondent banks without being detected by the banks and, thus, were not blocked under the WMDPSR program.
A complaint is merely an allegation and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The FBI is investigating the case. Trial Attorneys Jennifer Wallis and Michael Parker of the Criminal Division’s Asset Forfeiture and Money Laundering Section, Trial Attorney Christian Ford of the National Security Division’s Counterintelligence and Export Control Section and Chief Barbara Ward and Assistant U.S. Attorneys Joyce Malliet and Sarah Devlin of the District of New Jersey are prosecuting the case. The Criminal Division’s Office of International Affairs provided valuable assistance in this matter.
Department of Justice Awards over $20 Million to Law Enforcement Body-Worn Camera ProgramsRead the Press Release
NEWARK, N.J. – New Jersey U.S. Attorney Paul J. Fishman and Attorney General Loretta E. Lynch today announced awards totaling over $20 million to 106 state, city, tribal and municipal law enforcement agencies to establish and enhance law enforcement body-worn camera programs across the United States. Four New Jersey municipalities – Newark, Camden, Haledon and Evesham – and the N.J. State Police are among the recipients.
The awards, funded under the Office of Justice Programs’ Bureau of Justice Assistance’s (BJA) Fiscal Year 2016 Body-Worn Camera Policy and Implementation Program, will help law enforcement organizations implement body-worn camera policies, practices and evaluation methods to make a positive impact on the quality of policing in individual communities. Under this grant announcement, BJA awarded more than $16 million to state, local, and tribal law enforcement agencies, as well as a $3 million supplemental award to continue support for body-worn camera training and technical assistance. An additional $474,000 was awarded earlier this year under the 2016 Small Agency Body-Worn Camera Policy and Implementation Program.
“These federal grants will enable Newark, Camden, Haledon, Evesham and the New Jersey State Police to provide body-worn cameras for their officers and develop comprehensive policies for their use,” U.S Attorney Fishman said. “The information these cameras capture will be a valuable new resource for more effective policing that also respects the rights of citizens.”
“As we strive to support local leaders and law enforcement officials in their work to protect their communities, we are mindful that effective public safety requires more than arrests and prosecutions,” Attorney General Lynch said. “It also requires winning – and keeping – the trust and confidence of the citizens we serve. These grants will help more than 100 law enforcement agencies promote transparency and ensure accountability, clearing the way for the closer cooperation between residents and officers that is so vital to public safety.”
BJA expects award recipients to create programs that will be integrated as part of individual jurisdictions’ holistic problem-solving and community-engagement strategies.
The Body Worn Camera program was launched last year in response to a recommendation by the President’s Task Force on 21st Century Policing that law enforcement agencies use technology to strengthen relations with communities. BJA convened a Body-Worn Camera Expert Panel that identified issues and considerations confronting communities considering adoption of body camera technology. Initial research has shown that law enforcement use of body-worn camera programs improve law enforcement’s interaction with the public.
The New Jersey awards are as follows:
- N.J. State Police – $575,361
- Newark Police Department – $372,500
- Camden County Police Department– $118,500
- Evesham Township Police Department – $144,000
- Borough of Haledon Police Department – $17,920
In addition to the New Jersey recipients, today’s awardees include law enforcement agencies located in the following 31 states and Puerto Rico: Alabama, Arkansas, Arizona, Florida, California, Colorado, Delaware, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Maryland, Michigan, Minnesota, Montana, New York, Nevada, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Virginia, Wisconsin, and Wyoming. Tribal awardees include: Pokagon Band of Potawatomi Indians, the Little Traverse Bay Bands of Odawa Indians and the Nottawaseppi Huron Band of the Potawatomi.
For additional information about this grant program, visit: http://go.usa.gov/xKpJH
Camden County, New Jersey, Man Sentenced to More Than Five Years in Prison for Illegal Sale of 16 GunsRead the Press Release
CAMDEN, N.J. – A Pennsauken, New Jersey, man was sentenced today to 71 months in prison for illegally selling 16 guns, including firearms with high-capacity magazines and obliterated serial numbers, U.S. Attorney Paul J. Fishman announced.
Ammie Steward, a/k/a “Beav,” a/k/a “B,” 41, previously pleaded guilty before U.S. District Judge Renée Marie Bumb to an information charging him with one count of dealing firearms without a license and one count of possession of a firearm by a previously convicted felon. Judge Bumb imposed the sentence today in Camden federal court.
According to documents filed in this case and statements made in court:
Between May 2012 and Aug. 15, 2012, Steward sold 16 firearms on nine separate occasions for profit and without a license. The 16 firearms included 12 pistols and two rifles. Steward also admitted to using a power tool to obliterate the serial numbers on 14 of the 16 guns.
Steward sold them near Canal’s Liquors at 5360 Route 38 in Pennsauken to a witness who was cooperating with the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). Seven of the guns were sold along with high-capacity magazines. On at least one occasion, Steward sold a Kel Tec PLR-16 .223 caliber pistol along with a 30-round magazine and a box of ammunition. Steward also sold a Romarm/Cugir, WASR 10/63 .762 caliber rifle with two high-capacity magazines and a bayonet. All 16 weapons are now in the custody of law enforcement.
In addition to the prison term, Judge Bumb sentenced Steward to serve three years of supervised release.
U.S. Attorney Fishman credited special agents of the ATF, under the direction of Special Agent in Charge George P. Belsky, with the investigation leading to today’s sentencing. He also thanked the Pennsauken Police Department for their important role.
The government is represented by Assistant U.S. Attorney Matthew T. Smith of the U.S. Attorney’s Office Criminal Division in Camden.
Defense counsel: Maggie Moy Esq., Assistant Federal Public Defender, Camden
Romanian National Sentenced to Three Years in Prison for Role in Computer Hacking SchemeRead the Press Release
NEWARK, N.J. – A Romanian citizen was sentenced today to 36 months in prison for orchestrating an international hacking scheme targeting retailers, security companies, medical offices and individuals in the United States, U.S. Attorney Paul J. Fishman announced.
Mircea-Ilie Ispasoiu, 31, of Drobeta-Turnu Severin, Romania, previously pleaded guilty before U.S. District Judge Kevin McNulty to Count One and Count Seven of an indictment charging him with wire fraud and aggravated identity theft. Judge McNulty imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
From August 2011 through February 2014, Ispasoiu was employed as computer systems administrator at a large financial institution in Romania. Ispasoiu’s scheme involved hacking networks belonging to retailers, security companies, medical offices and individuals in order to steal user names and passwords, personal identifiers and credit and debit card data. Ispasoiu also gained access to a computer at a large security company that ran background checks on job applicants. Ispasoiu stole the applicants’ personal identifying information, including their fingerprints.
In addition to the prison term, Judge McNulty sentenced Ispasoiu to three years of supervised release and ordered him to pay restitution of $907,204.88.
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, with the investigation leading to today’s sentence. U.S. Attorney Fishman also thanked the Justice Department’s Office of International Affairs in Washington, as well as the Prosecutor’s Office attached to the High Court of Cassation and Justice in Romania and its law enforcement partners, for their support.
The government is represented by Assistant U.S. Attorney Daniel Shapiro of the Computer Hacking and Intellectual Property Section of the Office’s Economic Crimes Unit.
Defense counsel: Kevin Carlucci Esq., Assistant Federal Public Defender, Newark
Camden Man Pleads Guilty to Sex Trafficking of Minor After Posting Online AdvertisementRead the Press Release
TRENTON, N.J. – A Camden man pleaded guilty today to sex trafficking of a minor, U.S. Attorney Paul J. Fishman announced.
Aaron J. Gray, 29, of Camden, pleaded guilty before U.S. District Judge Peter G. Sheridan to an information charging him with one count of sex trafficking of a minor. Gray previously was charged in a criminal complaint with co-defendants Aja M. Easley, 22, of Camden, and Kenneth A. Mertz, 35, of Collingswood, with sex trafficking of a minor and conspiracy to engage in sex trafficking of a minor. Gray also was charged in the complaint with being a felon in possession of a firearm.
According to the documents filed in this case and statements made in court:
On March 2, 2015, Aja Easley communicated with the victim, a minor, using a popular social media website. Easley told the victim she was “worried about” the victim because of a previous assault by the victim’s ex-boyfriend. She offered the victim money, food, clothing, and shelter, and met the victim at the Camden Transportation Center. There, Easley told the victim about a “dating website,” and said that the victim could make money through the website by going on “dates.” Easley and the victim later met Gray and Mertz at a residence in Camden. Easley, Mertz, and Gray agreed to advertise the minor online for commercial sex acts for the purpose of earning money. To do so, Gray, Mertz, and Easley drove the minor to a motel in Cherry Hill.
At the motel, Gray and Easley convinced the victim to engage in commercial sex acts. Using her cellular telephone, Easley took provocative photos of the victim, and uploaded them to an online advertisement that she had created advertising the victim for commercial sex acts. After the advertisement was online, Easley used her cellular telephone to communicate with multiple individuals who responded to the advertisement seeking to engage in commercial sex acts with the minor. Gray gave the victim instructions on what to do when the respondents arrived. Easley instructed the victim to tell the individuals that, regardless of her real age, that she was 21 years old. Easley also instructed the victim how much time each individual could spend with the victim at the motel and how much each individual owed the victim. Easley and Gray also told the victim that if any trouble arose, Gray would be outside the motel with a firearm. While at the motel in Cherry Hill, the victim engaged in sex acts in exchange for money with multiple individuals, which the defendants split between themselves and the victim.
The next day, at a motel in Mount Laurel, New Jersey, at the defendants’ direction, the victim again engaged in sex acts in exchange for money with multiple individuals who responded to the advertisement. Later that evening, the defendants told the victim that they were taking the victim to Atlantic City, New Jersey, to meet another person who had responded to the advertisement and was willing to pay $1,200 for an entire evening with the victim. During the events on March 3, 2015, Gray was in possession of a semi-automatic firearm.
On the way to Atlantic City, the defendants agreed to let the victim stop at a residence in Gloucester City, New Jersey. The victim went inside and contacted the police, leading to the defendants’ arrest.
The count to which Gray pleaded guilty carries a statutory mandatory minimum of 10 years in prison, a statutory maximum of life in prison, and a maximum fine of $250,000. Sentencing is scheduled for Jan. 3, 2017.
On Aug. 17, 2016, Easley, pleaded guilty before Judge Sheridan to an information charging her with one count of sex trafficking of a minor and is scheduled to be sentenced Nov. 22, 2016.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher, and members of the Mount Laurel Police Department, under the direction of Police Chief Dennis Cribben, and the Gloucester City Police Department, under the direction of Acting Police Chief Brian Morell, with the investigation leading to todays’ guilty plea.
The government is represented by Assistant U.S. Attorney J. Brendan Day of the Office’s Criminal Division in Trenton.
The charges and allegations against Mertz remains merely an accusation, and he is considered innocent unless and until proven guilty.
Defense Counsel: Andrea D. Bergman Esq., Federal Public Defender’s Office, Trenton
Atlantic City, New Jersey, Man Admits Conspiring to Defraud IRS of Nearly $120,000 in TaxesRead the Press Release
CAMDEN, N.J. – An Atlantic City, New Jersey, man today admitted his role in a conspiracy to defraud the IRS of $119,880 in income taxes over three years, U.S. Attorney Paul J. Fishman announced today.
John Schultz, 74, pleaded guilty today before U.S. District Judge Joseph H. Rodriguez in Camden federal court to an information charging him with one count of conspiracy to defraud the United States.
According to documents filed in the case and statements made in court:
Schultz, William Boland, and another conspirator were partners in Royal Rolling Chairs Inc., a business based in Atlantic City that provided rolling chair transportation services to patrons on the boardwalk. As owners, they were responsible for accurately reporting income received by the business to the IRS.
Schultz admitted that he and his two partners hid gross cash receipts from the operation of the business and did not report this revenue to the IRS. He admitted that the business maintained a second set of books, which tracked the unreported cash revenue taken out of the business. The total tax loss from the conspiracy was $119,800.
The charge of conspiracy to defraud the United States carries a maximum potential penalty of five years in prison and a $250,000 fine, or twice the gain or loss from the offense. Sentencing is scheduled for Jan. 9, 2017.
Boland previously pleaded guilty to the same conspiracy charge and is scheduled to be sentenced by Judge Rodriguez on Oct. 25, 2016. Abdus Mian, the bookkeeper for Royal Rolling Chairs, pleaded guilty to making false statements to federal investigators and was sentenced on April 4, 2016 to one year of probation.
U.S. Attorney Fishman credited special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen and special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher, Newark Field Office, with the investigation leading to today’s guilty plea.
The government is represented by Deputy Attorney in Charge Matthew J. Skahill of the U.S. Attorney=s Office in Camden.
Defense counsel: Edwin J. Jacobs Jr. Esq., Atlantic City