District Not Recorded

WASHINGTON – Robert Morris of Crystal Springs, Miss., was sentenced today to 35 years in prison for production, distribution, receipt and possession of child pornography, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division, U.S. Attorney for the Southern District of Mississippi Donald R. Burkhalter and Immigration and Customs Enforcement Agency (ICE) Special Agent in Charge Raymond R. Parmer Jr. Morris was also ordered to serve a lifetime of supervised release following his prison term and to pay a $1,500 fine.

Morris pleaded guilty on June 2, 2010, to four counts of producing child pornography, one count of distributing child pornography, one count of receiving child pornography and two counts of possession of child pornography before U.S. District Court Judge William H. Barbour Jr. According to court documents and proceedings, ICE special agents and local police officers executed a federal search warrant on Jan. 15, 2009, for child pornography at Morris’s residence. A forensic review of a computer owned by Morris revealed numerous images of child pornography. According to information presented in court, Morris admitted to ICE agents that he had child pornography on his computer, that he had chatted with others online about having sex with children, and that he had knowingly received and traded pornographic images of children. A subsequent forensic review of Morris’ computer revealed that Morris had molested and photographed young teenage girls at his home on numerous occasions.

"Robert Morris’s crimes ran the full gamut of child pornography offenses – from production and distribution to receipt and possession," said Assistant Attorney General Breuer. "We can never forget that real children are being abused, then victimized repeatedly, as images of their abuse are passed from person to person. We are committed to investigating and prosecuting anyone who perpetuates this chain of exploitation – from those who create these horrific images, to those who send and receive them."

"All children have an absolute right to grow up free from the fear of sexual exploitation," said Raymond R. Parmer Jr., Special Agent in Charge of ICE’s Office of Homeland Security Investigation’s in New Orleans. "ICE relentlessly pursues predators who sexually abuse children, whether that abuse is physical in nature or if it’s accomplished by exploiting their images. The sentencing of Morris sends a strong message that ICE will not tolerate such despicable crime. Our agents will continue to police cyber space and target those who travel abroad to exploit one of the most vulnerable segments of our society- our children."

This case was investigated by ICE and the Crystal Springs, Miss., Police Department. This case was prosecuted by Assistant U.S. Attorney Glenda R. Haynes of the U.S. Attorney’s Office for the Southern District of Mississippi and Trial Attorney Andrew McCormack of the Criminal Division’s Child Exploitation and Obscenity Section.

WASHINGTON – The United States has asked a federal court to permanently bar a California man from promoting alleged sham pension-plan and welfare-benefit-plan tax fraud schemes, the Justice Department announced today. The civil injunction suit against William Alexander, who is based in Pasadena, Calif., and his two companies – Retirement Plan Services Inc. and Lyons Pensions Inc. – was filed in U.S. District Court in Los Angeles.

According to the complaint, Alexander helps small business owners adopt sham pension plans. He allegedly falsely advises customers that they can claim significant deductions for purported contributions to these sham pension plans in order to reduce or eliminate their federal income taxes. The complaint also alleges that Alexander fraudulently re-characterizes his customers’ non-deductible personal expenses as purported deductible pension-plan contributions.

One example of misconduct cited in the complaint was a letter in which Alexander allegedly advised a married couple from Florida who are physicians "to look for old personal checks that you wrote from 1/1/02 through 9/15/03 that are personal checks that I could re-characterize as pension contributions." The complaint also quotes a letter that Alexander allegedly sent to a Los Angeles customer in which Alexander explains that between $50,000 and $60,000 that the customer had made as a down payment on her condominium had been re-characterized as a pension-plan contribution. The complaint further alleges that Alexander helped a California cardiologist, who made a purported $350,625 welfare-benefit plan contribution, to get the funds back by using a sham loan.

The complaint also alleges that Alexander advises his customers that they can re-characterize their salaries as pension plan contributions that he can refund to them through sham loans. For example, the complaint alleges that Alexander advised a Los Angeles customer that she could send Alexander a $200,000 check as a purported pension plan contribution, and that Alexander would then return that customer’s money to her.

According to the complaint, Alexander helps customers adopt pension plans that illegally exclude rank-and-file employees. The complaint cites a letter Alexander allegedly sent to one of his clients, a California physician, in which Alexander explains that the goal is to "exclude the employees from this rich pension plan that I use for the owner." The complaint further alleges that Alexander tries to conceal his pension-plan scheme by purposely not filing required documents with the Internal Revenue Service and Department of Labor.

Alexander’s promotion of the pension plan and welfare-benefit tax fraud schemes have allegedly cost the government at least $30 million.

In the past 10 years the Justice Department’s Tax Division has obtained hundreds of injunctions against tax scheme promoters and tax preparers. Information about these cases is available on the Justice Department website

WASHINGTON – The United States has sued two Cobb County, Ga., tax preparers, seeking to put them out of business, the Justice Department announced today. The civil injunction suit, filed in U.S. District Court for the Northern District of Georgia, seeks to permanently bar Christopher Musyoki and Samuel Nganga from preparing federal returns for others. The complaint also names Musyoki’s tax preparation business, Simba Consultants Inc.

According to the government complaint, Musyoki and Nganga have underreported their customers’ income, and have included numerous fabricated claims for earned income and child tax credits on tax returns they prepare. Musyoki has also allegedly made fraudulent claims for the fuel tax credit. The fuel tax credit is available only in limited circumstances for off-highway business use, and fraudulently claiming the credit is one of the Internal Revenue Service’s (IRS) "Dirty Dozens" tax scams for 2010.

The IRS has also listed tax return preparer fraud as one of its "Dirty Dozen" tax scams for 2010. The Department of Justice has obtained injunctions against hundreds of tax-return preparers and tax-fraud promoters in the past 10 years. Information about these cases is available on the Justice Department website.

WASHINGTON – Bridges McRae, a former officer with the Memphis Police Department (MPD), pleaded guilty today in federal court to a felony civil rights charge related to the use of excessive force, the Justice Department announced today.

During the plea hearing, McRae admitted that Duanna Johnson had been in his custody when he used an unreasonable amount of force against her when he struck her while booking her into the Shelby County Jail. McRae acknowledged that his conduct violated federal law and that he violated Johnson’s civil rights. He further admitted that his attack caused bodily injury to Johnson in the form of cuts, bruises and pain.

McRae faces a maximum of 10 years in prison for the civil rights offense. The parties agree that McRae will be incarcerated for 24 months per the plea agreement. McRae also agreed to plead guilty to one count of tax evasion, pending approval by the Department of Justice’s Tax Division.

"Law enforcement officers are entrusted with a great amount of power so that they can effectively carry out their duty to protect public safety. This officer abused that power when he violated the civil rights of an individual in his custody," said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. "Officers who violate the public trust in this way will be brought to justice."

"Ensuring that public officials do not victimize the public by abusing their power is a top priority of this office," said Edward L. Stanton III, U.S. Attorney for the Western District of Tennessee.

"No one is above the law, especially those who have sworn an oath to uphold the law," said Amy Hess, Special Agent in Charge of the FBI’s Memphis Field Office. "It is a sad day when our citizens are preyed upon by its protectors, however, the FBI is proud to have worked alongside our law enforcement partners to ensure justice was served."

"We will continue to hold all officers of the Memphis Police Department accountable for their actions," said Director Larry Godwin of the MPD. "The citizens of Memphis expect no less. We will continue to investigate all complaints of abuse."

The case was jointly investigated by the FBI and the MPD Security Squad. Assistant U.S. Attorney Steve Parker and Trial Attorney Jonathan Skrmetti from the Civil Rights Division of the Department of Justice are prosecuting the case.

WASHINGTON — A Brooklyn, N.Y., grand jury returned an indictment today against two former executives of Asiana Airlines, Inc. (Asiana) for participating in a conspiracy to fix economy class airfares paid by passengers for travel from the United States to the Republic of Korea, the Department of Justice announced today.

The one-count indictment returned today in U.S. District Court in Brooklyn, charges Joo Ahn Kang and Chung Sik Kwak, each a former vice president of the Americas of Asiana, with conspiring with others to suppress and eliminate competition by fixing passenger fares for passenger transportation services from certain airports in the United States to Korea from in or about and between January 2000 and February 2006. Kang served as President of Asiana from December 2005 to November 2008.

 

According to the indictment, Kang and Kwak, each a citizen and resident of Korea, along with co-conspirators carried out the conspiracy by communicating and agreeing on the price of one or more components of the fares charged to passengers who purchased economy class tickets for flights between the United States and Korea. As a part of the conspiracy, Kang, Kwak and co-conspirators monitored and enforced adherence to the agreed-upon, noncompetitive rates charged to passengers traveling between the United States and Korea.

 

Kang and Kwak are charged with violating the Sherman Act, a violation which carries a maximum penalty of 10 years in prison and a $1 million fine. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

 

A total of 16 airlines and four executives have pleaded guilty or have agreed to plead guilty in the Justice Department’s ongoing investigation into price fixing in the air transportation industry. To date, fines of more than $1.6 billion have been imposed in the investigation and all of the pleading executives have been sentenced to serve prison time.

 

The airlines that have pleaded guilty, or have agreed to plead guilty, as a result of the department’s ongoing investigation into the air transportation industry are: British Airways Plc, Korean Air Lines Co. Ltd., Qantas Airways Limited, Japan Airlines International Co. Ltd., Martinair Holland N.V., Cathay Pacific Airways Limited, SAS Cargo Group A/S, Société Air France, Koninklijke Luchtvaart Maatschappij N.V. (KLM Royal Dutch Airlines), EL AL Israel Airlines Ltd., LAN Cargo S.A., Aerolinhas Brasileiras S.A., Cargolux Airlines International S.A., Nippon Cargo Airlines Co. Ltd., Northwest Airlines LLC and Asiana Airlines Inc. Airline executives who have pleaded guilty as a result of the investigation are Bruce McCaffrey of Qantas, Keith Packer of British Airways, Franciscus Johannes de Jong of Martinair and Timothy Pfeil of SAS. On Aug. 12, 2009, Jan Lillieborg, a citizen and resident of Sweden and former vice president of global sales for SAS Cargo, was indicted for participating in a conspiracy to suppress and eliminate competition by allocating customers and coordinating surcharge increases for international air shipments to and from the United States.

 

This case is part of a joint investigation into the air transportation industry being conducted by the Antitrust Division’s National Criminal Enforcement Section, the FBI’s Washington Field Office, the Department of Transportation’s Office of Inspector General and the U.S. Postal Service’s Office of Inspector General. The U.S. Attorney’s Office for the Eastern District of New York assisted in this matter. Anyone with information concerning price fixing or other anticompetitive conduct in the air transportation industry is urged to call the Antitrust Division’s National Criminal Enforcement Section at 202-307-6694 or visit www.justice.gov/atr/contact/newcase.htm or call the FBI’s Washington Field Office at 202-278-2000.

WASHINGTONToday Attorney General Eric Holder and U. S. Department of Health and Human Services (HHS) Secretary Kathleen Sebelius kicked off the second in a series of daylong summits bringing together a wide array of federal, state and local partners, beneficiaries, providers and other interested parties to discuss innovative ways to eliminate fraud within the U.S. health care system. The summit in Los Angeles included educational panels featuring law enforcement officials, including Assistant Attorney General Lanny A. Breuer of the Criminal Division, consumer experts, providers and key government agencies.

 

“In communities across the region, our health care system is under siege – exploited by criminals intent on lining their own pockets at the expense of American taxpayers, patients and private insurers,” said Attorney General Eric Holder.  “But through the Health Care Fraud Prevention and Enforcement Action Team, we are fighting back in bold, innovative and coordinated ways. In addition, the Affordable Care Act provides new resources and includes tough penalties to help stop and prevent health care fraud. We will continue to work vigorously with our law enforcement and private sector partners to punish those who steal from taxpayers, patients, seniors and other vulnerable Americans.”

 

Announced during the summit was a final regulation issued by the Centers for Medicare & Medicaid Services (CMS) increasing protections for both Medicare and Medicare beneficiaries from potentially fraudulent suppliers of durable medical equipment, prosthetics, orthotics and supplies (DMEPOS). The new regulation enhances Medicare enrollment standards for DMEPOS suppliers by adding several new standards and strengthens existing standards that suppliers must meet before being able to furnish equipment and supplies to Medicare beneficiaries. 

 

“The steps we are taking today provide us with additional tools to support our continuing efforts to reduce Medicare fraud by helping ensure that only appropriately qualified suppliers are enrolled in the program. We know the majority of medical equipment suppliers and health care providers want to improve the health of Medicare beneficiaries, but we also know there are those who look for any opportunity to take advantage of beneficiaries and Medicare, including sham operations that are not legitimate businesses,” said Secretary Sebelius.

 

The summit also featured educational panels that discussed best practices for both providers and law enforcement in preventing health care fraud. The panels included law enforcement officials, consumer experts, providers and representatives of key government agencies.

 

The recently enacted Affordable Care Act provides additional tools and resources to fight fraud in the health care system by providing an additional $350 million over the next 10 years through the Health Care Fraud and Abuse Control Account.  In addition, the Affordable Care Act toughens sentencing for criminal activity, enhances screenings and enrollment requirements, encourages increased sharing of data across government, expands overpayment recovery efforts, and provides greater oversight of private insurance abuses.  For information on the 2009 Health Care Fraud and Abuse Control Program Report, please visit www.justice.gov/dag/pubdoc/hcfacreport2009.pdf .

 

Investments in anti-fraud detection and enforcement pay for themselves many times over, and the Administration’s tough stance against fraud is already yielding results. In FY 2009, anti-fraud efforts put $2.51 billion back in the Medicare Trust Fund, a $569 million, or 29 percent, increase over FY 2008, and over $441 million in federal Medicaid money was returned to the treasury, a 28 percent increase from FY 2008.

 

The Affordable Care Act builds on innovative strategies to fight fraud, such as the Health Care Fraud Prevention and Enforcement Action Team (HEAT), the joint operation between the Department of Justice (DOJ) in partnership with the 94 U.S. Attorneys’ Offices, CMS and the HHS Office of Inspector General that has expanded Medicare Fraud Strike Force teams from South Florida and Los Angeles to now operating in seven regions to target health care fraud hot spots including Houston; Detroit; Brooklyn, N.Y.; Baton Rouge, La.; and Tampa, Fla.

 

On June 8, 2010, President Obama announced this nationwide series of regional fraud prevention summits as part of a multi-faceted effort to crack down on health care fraud. The Los Angeles summit was the second in a series, with additional summits to follow in the coming months in Detroit, Boston, New York, Philadelphia and Las Vegas.

 

On July 16, 2010, the U.S. Health and Human Services Secretary Kathleen Sebelius and U.S. Attorney General Eric Holder kicked-off the first in a series of Regional Health Care Fraud Prevention Summits in Miami.

 

A copy of the final regulation issued today is posted on the Federal Register site: www.cms.gov/MedicareProviderSupEnroll/09_ProviderEnrollmentRegulation.asp#TopOfPage

WASHINGTON – Viorel Simon, Nodirbek Abdoollayev and Bakhrom Ikramov have all pleaded guilty to charges related to their roles in a criminal enterprise that engaged in numerous criminal activities including forced labor, fraud in foreign labor contracting, visa fraud, mail fraud, identity theft, tax evasion and money laundering, the Department of Justice announced.

"These defendants took part in a modern day slavery scheme that victimized vulnerable individuals for profit," said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. "Forced labor robs victims of their freedom and their dignity, and it will not be tolerated in the United States. We will continue the aggressive prosecution of cases like this."

According to court documents, Simon pleaded guilty to racketeering conspiracy and fraud in foreign labor contracting. Simon actively supervised foreign national workers knowing that many of these workers were recruited with false promises and were coerced to work by threats of deportation and other adverse immigration consequences. Abdoollayev, who pleaded guilty to racketeering, assisted in the recruitment of foreign national workers, solicited hotels for housekeeping positions in which the foreign national workers were placed by the criminal enterprise, and laundered proceeds of the criminal enterprise. Ikramov, who pleaded guilty to wire fraud, fraudulently misrepresented the criminal enterprise’s payroll in order to defraud companies of insurance premiums.

Multiple co-defendants have previously pleaded guilty in connection with the case. On Aug. 18, 2010, Andrew Cole pleaded guilty to racketeering conspiracy and fraud in foreign labor contracting. Ilkham Fazilov pleaded guilty on Aug 9. 2010, to racketeering conspiracy for his role in aiding and abetting others in the scheme. Jakhongir Kakhkharov pleaded guilty to racketeering conspiracy on March 17, 2010. Alexandru Frumusache pleaded guilty on Oct. 7, 2009, to forced labor trafficking. Abdukakhar Azizkhodjaev pleaded guilty on June 18, 2010, to misprision of a felony. Trial for the remaining defendants is set for Oct. 18, 2010.

The cases were investigated by the FBI, the Department of Labor, the Internal Revenue Service, the Kansas Department of Revenue and the Independence, Mo., Police Department. Assistant U.S. Attorney William Meiners and Civil Rights Division Human Trafficking Prosecution Unit Trial Attorney Jim Felte prosecuted this case for the government.

WASHINGTON – Roberto Settineri42, of Miami Beach, Fla., pleaded guilty today to a one count superseding information charging him with conspiracy to commit money laundering, announced Assistant Attorney General Lanny A. Breuer, U.S. Attorney Wifredo A. Ferrer for the Southern District of Florida and John V. Gilles, Special Agent in Charge of the FBI’s Miami Field Office.

According to the information and statements made during the plea hearing, Settineri admitted to conspiring with others to launder $10 million in funds and concealed assets represented to be the proceeds of a large scale fraudulent scheme. The initial investigation was part of a joint U.S. and Italian law enforcement action.

Sentencing is scheduled for Nov. 3, 2010, before U.S. District Court Judge James I. Cohn in Miami. Settineri faces a maximum sentence of five years in prison.

The case is being prosecuted by Assistant U.S. Attorney Cynthia Stone and Criminal Division Trial Attorney Margaret Honrath of the Organized Crime and Racketeering Section.

The case was investigated by the FBI; the Broward County, Fla., Sheriff’s Office; the Miami-Dade Police Department; the Italian Ministries of the Interior and Justice; and the Italian National Police. Assistance was also provided by U.S. Immigration and Customs Enforcement. The Criminal Division’s Office of International Affairs and the FBI Legal Attaché Office in Rome provided assistance in this case.

WASHINGTON – Dorothy St. Laurent, 71, of Johnston, R.I., and her son Anthony St. Laurent Jr., 44, of Cranston, R.I., pleaded guilty today in U.S. District Court in Providence, R.I., to interstate extortion in violation of the Hobbs Act.  The wife and son of Anthony St. Laurent Sr., a person identified by law enforcement as a member of organized crime, were charged in a federal complaint in February 2010 with extorting payments from bookmakers in the Taunton, Mass., area on behalf of Anthony St. Laurent Sr.

The guilty pleas were announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division, U.S. Attorney for the District of Rhode Island Peter F. Neronha and Richard DesLauriers, Special Agent in Charge of the FBI’s Boston Field Office.  The pleas were entered before U.S. District Court Judge William E. Smith.

According to information presented at the plea hearing, beginning at least as early as 1988 and continuing through early February 2009, Dorothy St. Laurent and Anthony St. Laurent Jr. conspired with each other and others to extort "protection" payments from a group of illegal bookmakers operating in and around Taunton.

The government’s evidence includes a number of conversations recorded by the FBI in late 2008 and early 2009 that capture Dorothy St. Laurent and Anthony St. Laurent Jr. in conversation with a cooperating witness as they discuss efforts to maintain the extortion scheme, which, at that time, was generating $4,100 in cash collected by Dorothy St. Laurent every two weeks.  The plea agreement stipulates that the defendants extorted in excess of $800,000 and less than $1.5 million.

Dorothy St. Laurent served as the primary collection agent of the cash payments provided by the bookmakers while Anthony St. Laurent Jr.’s role was to both threaten violence and on at least one occasion, to engage in actual violence to enforce continued payment.

Dorothy and Anthony St. Laurent Jr. are scheduled to be sentenced on Dec. 10, 2010.  Anthony St. Laurent Sr. is detained awaiting trial on a charge of solicitation to commit murder-for-hire and on this matter.

Trial Attorney Scott Lawson of the Criminal Division’s Organized Crime and Racketeering Section is prosecuting the case, with assistance from Assistant U.S. Attorney William J. Ferland.  The matter was investigated by the FBI, with the assistance of Rhode Island State Police and the Providence Police Department.

MIAMI – Victor Manuel Amaya pleaded guilty this morning to one count of willfully filing a false tax return before U.S. District Court Judge Cecilia M. Altonaga, the Justice Department and the Internal Revenue Service (IRS) announced today. The court set sentencing for Nov. 3, 2010.

According to court documents, from 2004 through 2007, Amaya, who owns Amaya Contracting and Stucco Inc. (ACS), filed fraudulent employment tax returns with the IRS and caused his company to underpay its federal employment taxes. To avoid having to report all of ACS’s employment tax obligations, Amaya regularly cashed checks made out to ACS at a local check cashing store instead of depositing them into the company’s account. Amaya then used the cash to pay his workers, which allowed him to report lower wages and lower employment taxes due on ACS’s employment tax returns. Amaya also used the cash for materials and personal expenses. Additionally, Amaya wrote ACS checks to fictitious companies and cashed them at local check cashing stores. Amaya also used this cash to pay his workers.

Amaya pleaded guilty to a one-count information charging him with willfully filing a false employment tax return with the IRS. All told, Amaya failed to report to the IRS approximately $2,130,568 in wages, which resulted a tax loss of approximately $319,585. Amaya faces a maximum of three years in prison and has agreed to pay restitution to the IRS of $319,585.

Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, and John A. DiCicco, Acting Assistant Attorney General for the Department of Justice, Tax Division, commended the IRS Special Agents who investigated this case and Tax Division Trial Attorney Matthew J. Mueller, who prosecuted the case.

GREENBELT, Md. - Francisco Ortiz, aka “Francis Gabriel Ortis,” “Pone” and “King Pone,” 26, of Rockville, Md., pleaded guilty today to conspiracy to participate in a racketeering enterprise, in connection with his gang activities as a member and leader of the Almighty Latin King and Queen Nation.

       

The guilty plea was announced by Assistant Attorney General Lanny A Breuer, of the Department of Justice Criminal Division; U.S. Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Theresa R. Stoop of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) - Baltimore Field Division; Chief J. Thomas Manger of the Montgomery County Police Department; Montgomery County State’s Attorney John McCarthy; Chief Roberto L. Hylton of the Prince George’s County Police Department; and Prince George’s County State’s Attorney Glenn Ivey.

              

“The people of Maryland know all too well the violence that Latin Kings members can bring to communities.  Attempted murder, witness tampering and armed robbery – Francisco Ortiz admitted to participating in all these activities as a Latin Kings member and leader. As this guilty plea shows, however, our gang unit prosecutors, Assistant U.S. Attorneys and law enforcement partners are taking these violent offenders off the streets of our communities,” said Assistant Attorney General Lanny A. Breuer of the Criminal Division.

 

“The defendant admitted that the Latin Kings is a violent organized gang with thousands of members who commit assaults, robberies and murders,” said U.S. Attorney Rod J. Rosenstein.  “The strategy of combining the resources and intelligence of local, state and federal law enforcement agencies to pursue federal racketeering charges is proving effective.”            

 

According to Ortiz’s plea agreement, the Latin Kings is a violent street gang with thousands of members across the country and overseas.  The Latin Kings have a detailed and uniform organizational structure, which is outlined – along with various “prayers,” codes of behavior and rituals – in a written “manifesto” widely distributed to members throughout the country.  Members of the Latin Kings are also traditionally given “King Names” or “Queen Names,” which are names other than their legal names, by which they are known to members of the gang and to others on the street.  At the local level, groups of Latin Kings are organized into “tribes,” including, the Royal Lion Tribe, MOG, Sun Tribe and UTL.

       

According to the plea agreement, in mid-2007, Ortiz became a member of the Royal Lion Tribe in Maryland and the tribe’s Third Crown/Enforcer.  Ortiz became the First Crown/Inca of the tribe in 2008, when members of the Royal Lion tribe formed the MOG tribe.  Ortiz led the MOG tribe until mid-2009, when he was removed from power, then formed and became the leader of the UTL tribe.  As a Latin King leader, Ortiz organized meetings where dues were collected from members and gang business was discussed.  As First Crown/Inca, Ortiz traveled to Pennsylvania, New York and Florida where he met with other Latin King leaders.

       

Ortiz admitted that as part of his gang activities, in late summer or fall of 2007, Ortiz and other Latin King members carried out the armed robbery of a drug dealer at condominiums in Langley Park, Md.  According to the plea agreement, one of the Latin Kings knocked on the drug dealer’s door and when the door opened, Ortiz and two other Latin King members and associates forced their way into the apartment, each carrying a gun.  Once inside, they put their guns to the heads of the dealer and his young daughter.  The Latin King members held the drug dealer and his daughter at gunpoint in the bedroom while they searched the residence, eventually stealing a few bags of powder cocaine.

       

According to the plea agreement, in December 2007, Ortiz and other Latin King members and associates participated in the attempted murder of a suspected rival gang member.  When several Latin King members began walking in the wooded area behind a condominium complex in Langley Park, one or more people - suspected to be MS-13 members - began shooting at them. After the Latin Kings began running to their cars, Ortiz made them stop, get out of their cars and retaliate against the suspected MS-13 members.  When the Latin Kings found an individual who they believed was a member of MS-13, they attacked and stabbed him.

       

Ortiz admitted that on Jan. 19, 2009, he and other Latin King members and associates threatened and attempted to physically assault a Latin Queen, who was the intended victim of an earlier firebombing.  Three days earlier, three members of the Latin Kings had been sentenced after pleading guilty in that case.  Ortiz and other Latin Kings attended the sentencing at U.S. District Court in Greenbelt.  Believing that if the Latin Queen was not a witness or changed her testimony the three Latin Kings would be able to successfully appeal their convictions for the firebombing, Ortiz and other Latin Kings put a plan in place to assault the Latin Queen in an attempt to influence, change or prevent her testimony.  ATF agents learned of the plan and were able to prevent the attack.

       

Finally, Ortiz admitted that on July 8, 2009, he and members of the UTL tribe attempted to murder a person in Germantown, Md.  The victim was walking on a residential street with two friends when a car approached them.  Several people got out of the car and began chasing the victim.  The victim was eventually caught and struck in the back of the head.  The victim fell to the ground where Ortiz and other Latin Kings beat the victim with a bat, kicked, punched and stabbed him multiple times.  Ortiz was arrested two days after the attack and at the time of his arrest had three machetes with him.

       

Ortiz faces a maximum sentence of life in prison.  U.S. District Judge Alexander Williams, Jr. has scheduled sentencing for Dec. 1, 2010 at 9:30 a.m.  Ortiz remains detained.

 

Co-defendants Miguel Cruz, aka “Skibee” and “King Skibee,” 45, of Bronx, N.Y., one of the founders of the Maryland tribe of the Latin Kings; Andres Echevarria, aka “B-Boy” and “King B-Boy,” 23, of Brooklyn, N.Y., who admitted that he held leadership positions in the Latin Kings; and Nelson Santos, aka “Nelly” and “King Nelly,” 27, of Silver Spring, Md., previously pleaded guilty to the racketeering conspiracy in connection with their gang activities and are scheduled to be sentenced on Sept. 16, 2010, Sept. 2, 2010, and Oct. 22, 2010, respectively, at 9:30 a.m.  All remain in federal custody.

 

The case was investigated by the Gaithersburg, Md.. Police Department, the Montgomery, Md., County Sheriff’s Office, the Maryland National Capital Park Police - Prince George’s County Division, the Maryland State Police, the New York City Police Department, the U.S. Secret Service, the Internal Revenue Service - Criminal Investigation and U.S. Immigration and Customs Enforcement.

       

Assistant U.S. Attorneys Emily Glatfelter and David Salem, and Lara M. Peirce, a Trial Attorney with the Criminal Division’s Gang Unit, prosecuted the case.

WASHINGTON – Hazim Gaber, 22, of Edmonton, Canada, was sentenced today in Phoenix by U.S. District Court Judge James A. Teilborg to 33 months in prison for selling counterfeit cancer drugs using the Internet, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division, U.S. Attorney Dennis Burke for the District of Arizona and FBI Special Agent in Charge of the Phoenix Field Office Nathan T. Gray. Judge Teilborg also ordered Gaber to pay a $75,000 fine, as well as $53,724 in restitution, and to serve three years of supervised release following his prison term.

Gaber was indicted by a federal grand jury in Phoenix on June 30, 2009, on five counts of wire fraud for selling counterfeit cancer drugs through the website DCAdvice.com. Gaber was arrested on July 25, 2009, in Frankfurt, Germany, and was extradited to the United States on Dec. 18, 2009. At his plea hearing in May 2010, Gaber admitted selling what he falsely claimed was the experimental cancer drug sodium dichloroacetate, also known as DCA, to at least 65 victims in the United States, Canada, the United Kingdom, Belgium and the Netherlands between October and November 2007. Gaber also admitted to selling more than 800 pirated copies of business software between February 2007 and December 2008. As part of the plea agreement, Gaber agreed to forfeit or cancel any website, domain name or Internet services account related to this fraud scheme.

"Hazim Gaber went from selling false hope to cancer patients to now spending 33 months in a U.S. prison," said Assistant Attorney General Lanny A. Breuer of the Criminal Division. "Criminals often seek to exploit the most vulnerable of victims - but offering fake, unapproved medication to cancer patients reaches a new low. Today’s sentence shows that cyber criminals who prey on the seriously ill cannot elude justice simply by committing crimes outside of our borders."

"Gaber used the Internet to victimize people already suffering from the effects of cancer," said Dennis K. Burke, U.S. Attorney for the District of Arizona.  "Now he will go to prison for this bogus business and heartless fraud."

"The FBI and the U.S. Attorney’s Office  are committed to pursuing individuals who prey on  those who are living with the affects of cancer," said Nathan Gray, Special Agent in Charge of the FBI Phoenix Division.  "Today’s sentencing illustrates international law enforcement partners working together to send  a message not  to use the Internet to perpetuate fraud, especially against those afflicted with a serious medical condition."

According to the plea agreement, Gaber charged $23.68 for 10 grams of the purported DCA, $45.52 for 20 grams or $110.27 for 100 grams, plus shipping. In actuality, Gaber admitted he sent victims a white powdery substance that was later determined through laboratory tests to contain starch, dextrin, dextrose or lactose, and contained no DCA. According to court documents, along with the counterfeit DCA, the packages also contained a fraudulent certificate of analysis from a fictitious laboratory and instructions on how to dilute and ingest the bogus DCA. DCA is an experimental cancer drug that has not yet been approved by the U.S. Food and Drug Administration for use in the United States. According to the plea agreement Gaber knew that the website DCAdvice.com contained false claims that it was the only legal supplier of DCA and falsely claimed it was associated with the University of Alberta.

According to information contained in the plea agreement, DCA is an odorless, colorless, inexpensive, relatively non-toxic experimental cancer drug that is highly sought by cancer patients. A doctor at the University of Alberta in Canada published a report in early 2007 summarizing the results of a study, which showed that DCA caused regression in several cancers, including lung cancer, breast cancer and cancerous brain tumors. According to information contained in the plea agreement, DCA cannot be prescribed by a medical doctor in the United States or Canada, since it is currently not approved for use in patients with cancer, nor is DCA available in pharmacies.

Today’s sentencing is part of a larger department-wide effort led by the Department of Justice Task Force on Intellectual Property (IP Task Force). Attorney General Eric Holder created the IP Task Force to combat the growing number of domestic and international intellectual property crimes, protect the health and safety of American consumers, and safeguard the nation’s economic security against those who seek to profit illegally from American creativity, innovation and hard work. The IP Task Force seeks to strengthen intellectual property rights protection through heightened criminal and civil enforcement, greater coordination among federal, state and local law enforcement partners, and increased focus on international enforcement efforts, including reinforcing relationships with key foreign partners and U.S. industry leaders. To learn more about the IP Task Force, go to www.justice.gov/dag/iptaskforce/

The case was prosecuted by Trial Attorney Thomas S. Dougherty of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Peter Sexton of the U.S. Attorney’s Office for the District of Arizona. Significant assistance has been provided by the Edmonton Police Service, the Alberta Justice Office of Special Prosecutions-Edmonton, the Competition Bureau of Canada, the U.S. Postal Inspection Service, the Federal Trade Commission and the Alberta Partnership Against Cross Border Fraud. The Criminal Division’s Office of International Affairs provided assistance in this case. The case was investigated by the Phoenix FBI Cyber Squad.

WASHINGTON A former U.S. Army staff sergeant was charged today with bribery, theft of government property and conspiracy in connection with a fuel theft scheme to solicit approximately $400,000 in bribes from a government contractor in Afghanistan, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division and U.S. Attorney Neil H. MacBride of the Eastern District of Virginia.

 

Stevan Nathan Ringo, 26, of Marrero, La., was charged today in a three-count indictment, returned by a federal grand jury in the Eastern District of Virginia, with one count of bribery as a public official, one count of theft of government property, and one count of conspiracy to commit bribery and theft of government property. Ringo was originally arrested on June 25, 2010, based on a criminal complaint charging him with one count of conspiracy to commit theft of government property.

 

According to the indictment, Ringo was stationed at Forward Operating Base (FOB) Shank, a U.S. Army installation in the Logar Province of Eastern Afghanistan. FOB Shank supports U.S. military operations in Afghanistan in various ways, including through fuel receipt and redistribution. More specifically, the Army stores large quantities of fuel at FOB Shank and redistributes that fuel to installations in the surrounding area through government contractors. Ringo’s responsibilities at FOB Shank included supervision of that fuel redistribution process.

 

The indictment alleges that, between December 2009 and February 2010, Ringo solicited and accepted approximately $400,000 in cash payments from a government contractor in exchange for his creation and submission of fraudulent paperwork permitting that contractor to steal fuel from FOB Shank. The indictment alleges that the total value of the fuel stolen during the course of the scheme was approximately $1.4 million.

 

The bribery count carries a maximum penalty of 15 years in prison and a fine of the greater of $250,000; three times the value of the payments made or solicited; or twice the value gained or lost from the scheme. The theft of government property count carries a maximum penalty of 10 years in prison and a fine of the greater of $250,000 or twice the value gained or lost, while the conspiracy count carries a maximum penalty of five years in prison and a fine of the greater of $250,000 or twice the value gained or lost.

 

The case is being prosecuted by Trial Attorney Ryan S. Faulconer of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Edmund P. Power for the Eastern District of Virginia. Substantial assistance was provided by Trial Attorney Dan E. Stigall of the Criminal Division’s Office of International Affairs. The case is being investigated by the FBI, the Defense Criminal Investigative Service, the U.S. Army Criminal Investigative Division, other military law enforcement at FOB Shank, and members of the National Procurement Fraud Task Force (NPFTF) and the International Contract Corruption Task Force (ICCTF).

 

The NPFTF, created in October 2006 by the Department of Justice, was designed to promote the early detection, identification, prevention and prosecution of procurement fraud associated with the increase in government contracting activity for national security and other government programs. The ICCTF is a joint law enforcement agency task force that seeks to detect, investigate, and dismantle corruption and contract fraud resulting from U.S. Overseas Contingency Operations worldwide, including in Kuwait, Afghanistan and Iraq.

 

The charges contained in the indictment are merely accusations and the defendant is presumed innocent.

 

WASHINGTON - A federal district judge in Atlanta has permanently barred Saloum A. Njie and his company, MIAAS Associates LLC, from preparing federal tax returns for others, the Justice Department announced today. The court also ordered the defendants to provide their customer lists to the government and to mail copies of the court order to their former clients.

 

The court found that in preparing federal tax returns to submit to the Internal Revenue Service (IRS), the defendants consistently understated their customers’ true tax liabilities based upon unreasonable positions that they knew or should have known were not supported by substantial authority. The defendants prepared customers' tax returns claiming either the earned income tax credit for customers who do not qualify for the credit, or overstating the credit amount to which customers are entitled. Additionally, defendants have continued this unlawful practice despite three separate investigations by the IRS, each of which found numerous violations of federal tax law and resulted in thousands of dollars in monetary penalties.

 

Altogether, defendants’ activities may have resulted in more than $1 million in understated federal income tax liabilities for their customers, for returns prepared between 2006 and 2009.

 

Over the past decade, the Justice Department’s Tax Division has obtained hundreds of injunctions to stop tax fraud promoters and dishonest tax return preparers. Information about these cases is available on the Justice Department website.

WASHINGTON – As the Deepwater Horizon oil spill clean-up efforts continue and the Gulf Coast Claims Facility (GCCF) opens its doors, the Department of Justice is reminding members of the public to be aware of and report any instances of suspected fraudulent activity related to relief operations and funding for victims.

Members of the public can report fraud, waste, abuse or allegations of mismanagement involving disaster relief operations through the National Center for Disaster Fraud (NCDF) Disaster Fraud Hotline at 877-NCDF-GCF (623-3423), the Disaster Fraud Fax at 225-334-4707 or the Disaster Fraud e-mail at [email protected].  Individuals can also report criminal activity to the FBI at 1-800-CALL-FBI.  As part of a public awareness campaign, NCDF contact information is being publicized throughout the Gulf Coast region on 150 electronic billboards and more than 500 posters.

"We will not tolerate fraud schemes that exploit this tragic oil spill to the detriment of residents and businesses along the Gulf Coast," said Assistant Attorney General Lanny A. Breuer of the Criminal Division.  "We know that following any disaster, criminals looking to make a quick buck often attempt to prey upon vulnerable disaster victims.  Our agents and prosecutors stand ready to take swift and aggressive action against any oil-spill related fraud.  We cannot and will not allow unscrupulous individuals to line their own pockets at the expense of men and women who have suffered real losses."

Assistant Attorney General Breuer reinforced that the Department of Justice and its law enforcement partners have placed a high priority on the prompt investigation and prosecution of fraud schemes related to the oil spill.

"The NCDF stands ready to take complaints about any and all forms of fraud stemming from the oil spill," said Jim Letten, U.S. Attorney for the Eastern District of Louisiana and Executive Director for the NCDF.  "We urge all members of the public who suspect or hear reports of fraud relating to the oil spill to immediately contact the NCDF.  All legitimate complaints that the NCDF receives will be immediately screened and referred to appropriate federal investigative agencies for possible criminal investigation and prosecution."

The Criminal Division’s Fraud Section, certain U.S. Attorneys’ Offices and law enforcement agencies are coordinating to ensure expeditious handling of oil spill-related fraud cases.  To enhance effective coordination among prosecutors, federal criminal investigative agencies and inspectors general, the department will host a one-day law enforcement training and coordination conference on oil spill fraud issues in September.

In response to a significant amount of fraud associated with federal disaster relief programs that went into effect following Hurricanes Katrina, Rita and Wilma, a Joint Command Center was established in Baton Rouge, La., in 2005.  The command center, now known as the National Center for Disaster Fraud, has received and screened more than 39,000 complaints of disaster fraud and referred more than 25,000 of those to law enforcement for investigation.  The NCDF – based on its extensive expertise and established infrastructure – has helped victims of fraud related to Hurricanes Katrina, Rita, Wilma, Ike and Gustav, as well as those affected by severe storms in more than 20 different states, earthquakes, tsunamis and wildfires.  

To date, the Department of Justice has charged more than 1,300 defendants in 47 judicial districts throughout the country for disaster fraud related to Hurricanes Katrina, Rita and Wilma. 

To learn more about the NCDF and its efforts to fight fraud related to the oil spill, go to www.justice.gov/criminal/oilspill/.

WASHINGTON – The Justice Department today announced that it will monitor the primary elections on Aug. 24, 2010, in Apache and Navajo Counties, Ariz., to ensure compliance with the minority language requirements of the Voting Rights Act of 1965 and other federal voting rights statutes.  The Voting Rights Act requires these covered jurisdictions to provide language assistance in certain Native American languages during the election process. 

Under the Voting Rights Act, the Justice Department is authorized to ask the U.S. Office of Personnel Management (OPM) to send federal observers to jurisdictions that are certified by the Attorney General or by a federal court order. Federal observers will be assigned to monitor polling place activities in these counties based on the attorney general’s certification. The observers will watch and record activities during voting hours at polling locations in these jurisdictions, and Civil Rights Division attorneys will coordinate the federal activities and maintain contact with local election officials.

 

 

 

Each year, the Justice Department deploys hundreds of federal observers from OPM, as well as departmental staff, to monitor elections across the country.  To file complaints about discriminatory voting practices, including acts of harassment or intimidation, voters may call the Voting Section of the Justice Department’s Civil Rights Division at 1-800-253-3931.  Visit www.justice.gov/crt/voting/index.php for more information about the Voting Rights Act and other federal voting laws.

 

 

WASHINGTON - Dwain D. Williams was convicted Thursday by a federal jury in Valdosta, Ga., on child sex abuse offenses, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division and Acting U.S. Attorney G. F. Peterman III of the Middle District of Georgia.

Williams was convicted of one count of traveling in foreign commerce and engaging in illicit sexual conduct, one count of aggravated sexual abuse and one count of abusive sexual contact of a child under 12 years of age. The aggravated sexual abuse and the abusive sexual contact charges were committed while Williams was accompanying a member of the Armed Forces outside of the United States in violation of the Military Extraterritorial Jurisdiction Act (MEJA). Williams faces a possible mandatory minimum sentence of 30 years in prison and a maximum sentence of life in prison for his conviction.

At trial, the female victim, currently 15 years old, testified that Williams had repeatedly raped her starting from when she was nine years old until she was 13, when she lived in Okinawa, Japan.

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

This case was prosecuted by Assistant U.S. Attorney Leah McEwen of the Middle District of Georgia and Trial Attorney Mi Yung C. Park of CEOS. The case was investigated by the FBI and the Office of Special Investigations for Moody Air Force.

WASHINGTON – David Grummer, 44, of San Diego, was sentenced late Friday to 295 months in prison following his conviction on 18 counts of receipt of child pornography and five counts of possession of child pornography, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division and U.S. Attorney Laura E. Duffy for the Southern District of California. 

 

Grummer was convicted by a federal jury in San Diego on June 24, 2010.  Grummer is also required to register as a sex offender and to serve 15 years of supervised release following his prison term. Grummer has been detained since his arrest on Dec. 5, 2008.

 

The case originated from a joint investigation by the Environmental Protection Agency (EPA), Office of Criminal Enforcement and the FBI into the illegal sale of chlordane and DDT on the Internet.  According to court documents and three days of trial testimony, Grummer, who was employed at a hazardous waste recycling facility, was selling banned chemicals on the Internet.  Following an EPA, Office of Criminal Enforcement and FBI search warrant of his residence in Oceanside, Calif., forensic examiners discovered child pornography on one of the computer hard drives seized.  According to evidence at trial and court documents, the FBI Cyber Squad then conducted an investigation that led to a second search warrant of the residence and the discovery of hundreds of images of child pornography on five separate hard drives.  Additional forensic analysis revealed Grummer utilized file share programs to search for and download images depicting the sexual exploitation of children. 

 

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice.  Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

 

The case was prosecuted by Assistant U.S. Attorneys Alessandra P. Serano and Matthew J. Gardner for the Southern District of California and Trial Attorney LisaMarie Freitas of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS).  The case was investigated by the EPA and the FBI, with the assistance from the Regional Computer Forensic Laboratory.  Additional computer forensic support was provided by CEOS’ High Technology Investigative Unit.                         

WASHINGTON – Rodolfo Rodriguez Cabrera, 43, a Cuban national, and Henry Mantilla, 35, of Cape Coral, Fla., were sentenced today by U.S. District Court Judge Philip M. Pro in Las Vegas to two years in prison each for conspiring to produce and sell counterfeit International Game Technology (IGT) video gaming machines, commonly known as slot machines, and counterfeit IGT computer programs, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division, U.S. Attorney for the District of Nevada Daniel G. Bogden and FBI Special Agent in Charge of the Las Vegas Field Office Kevin Favreau. 

Judge Pro also ordered Cabrera and Mantilla each to pay $151,800 in restitution and to serve three years of supervised release following their prison terms. The defendants also agreed to forfeit any and all counterfeit items in their possession and any illegal proceeds from their criminal activity. 

Cabrera and Mantilla pleaded guilty on May 6, 2010, for their roles in the conspiracy.  They were indicted originally by a federal grand jury in Las Vegas on April 22, 2009, with one count of conspiracy, two counts of trafficking in counterfeit goods, two counts of trafficking in counterfeit labels and two counts of criminal copyright infringement.  According to court documents, Cabrera and Mantilla conspired between August 2007 and April 15, 2009, to make and sell unauthorized copies of computer programs designed for IGT video slot machines and counterfeit IGT video slot machines bearing IGT’s registered trademarks, all without the permission of IGT. 

Cabrera was arrested June 8, 2009, in Riga, Latvia, and extradited from Latvia to the United States on Oct. 23, 2009.  Cabrera is the first individual to be extradited from Latvia to the United States under a new extradition treaty between the U.S. and Latvia, which entered into force on April 15, 2009.  Cabrera’s extradition and prosecution is the result of cooperation between U.S. and Latvian law enforcement and the Latvian government. 

Today’s sentencings are part of a larger department-wide effort led by the Department of Justice Task Force on Intellectual Property (IP Task Force).  Attorney General Eric Holder created the IP Task Force to combat the growing number of domestic and international intellectual property crimes, protect the health and safety of American consumers, and safeguard the nation’s economic security against those who seek to profit illegally from American creativity, innovation and hard work.  The IP Task Force seeks to strengthen intellectual property rights protection through heightened criminal and civil enforcement, greater coordination among federal, state and local law enforcement partners, and increased focus on international enforcement efforts, including reinforcing relationships with key foreign partners and U.S. industry leaders.  To learn more about the IP Task Force, go to http://www.justice.gov/dag/iptaskforce/

The case was prosecuted by Trial Attorney Thomas S. Dougherty of the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS) and Assistant U.S. Attorney Michael Chu of the U.S. Attorney’s Office for the District of Nevada.  Significant assistance has been provided by the Central Criminal Police Department of the Latvian Ministry of Interior; Latvia’s Office of the Prosecutor General, International Cooperation Division; and Senior Trial Attorney Deborah Gaynus of the Criminal Division’s Office of International Affairs.

WASHINGTON – A federal grand jury in the Western District of Tennessee indicted Terrence Arnett Yarbrough, aka “T-Rex,” on four counts of sex trafficking by force, fraud, and coercion against minor and adult female victims. Yarbrough, Michelle Johnson and Norma Yarbrough Webb were additionally charged in the indictment with conspiracy to fraudulently obtain food stamps.

The charges include allegations of sex trafficking of two minor and two adult female victims, during the time period between June 2006 and August 2009. Specifically, the indictment alleges that through the use of force, fraud and coercion, Yarbrough caused the women to commit commercial sex acts for his own financial benefit.

The conspiracy count alleges that on Sept. 26, 2009, and continuing until Feb. 28, 2010, Yarbrough, Johnson and Webb conspired to unlawfully acquire and possess food stamp coupons, authorization cards and access devices. According to the indictment, while Yarbrough was incarcerated in Lincoln City Mo. , he conspired with Webb to apply for food stamp benefits on his behalf. Webb then submitted an application to the Tennessee Department of Human Services that stated that Yarbrough resided at a particular address in Memphis Tenn The indictment also alleges that Johnson used the fraudulently-obtained benefits to purchase food at various stores in Missouri The food stamps, authorization cards and access devices were valued between $100 and $5,000, and were used to support the female victims.

If convicted of sex trafficking, Yarbrough could face a maximum sentence of life in prison. If convicted of conspiracy, Yarbrough could face a maximum sentence of five years in prison.

An indictment is merely an accusation and the defendants are presumed innocent unless proven guilty.

The case is being investigated by the FBI. It is being prosecuted by Assistant U.S. Attorney Steve Parker from the U.S. Attorney ’s Office for the Wester n District of Tennessee, and Jonathan Skrmetti, a Trial Attorney with the U.S. Department of Justice ’s Civil Rights Division.

"We are extremely pleased that the Appeals Court in Thailand has granted the extradition of Viktor Bout to the United States on charges of conspiring to sell weapons to a terrorist organization for use in killing Americans. We have always felt that the facts of the case, the relevant Thai law and the terms of our bilateral extradition treaty clearly supported the extradition of Mr. Bout on these charges. 

The prosecution of Viktor Bout is of utmost priority to the United States, but the criminal charges he faces are not solely an American concern. He has been sanctioned by the United Nations for alleged arms trafficking activity and support of armed conflicts in Africa."

WASHINGTON - Eric Jon Eisenhower, a resident of Fairfax Station, Va., pleaded guilty Thursday in federal court in Alexandria, Va., for failing to collect, account for and pay over to the Internal Revenue Service (IRS) more than $200,000 in withholdings from employees’ paychecks between 2004 and 2008, the Justice Department and IRS announced today.

According to court documents, Eisenhower was the president of CoManage Inc., a computer software development company. From December 2004 through June 2008, Eisenhower failed to pay over to the IRS CoManage’s employees’ withholdings for Social Security, Medicare and federal income taxes. U.S. District Court Judge T.S. Ellis set Eisenhower’s sentencing for Nov. 12, 2010.

This case was investigated by IRS Criminal Investigation. Assistant U.S. Attorney Mark Lytle and Tax Division Trial Attorney Caryn Mark are prosecuting the case on behalf of the United States.

WASHINGTON – A federal grand jury returned an indictment charging Natchez, Miss., Police Department Officers Elvis Prater, 35, and Dewayne Johnson, 32, with civil rights offenses and other offenses related to the beating of two men in custody, the theft of an arrestee’s credit and debit cards, and the officers’ false statements to federal investigators. Prater and Johnson were arrested Thursday morning.

Prater was charged with two counts of deprivation of rights under color of law and one count of false statements. If convicted, he faces a maximum punishment of 10 years in prison for the civil rights offenses and five years in prison for the false statements offense. Johnson was charged with two counts of deprivation of rights under color of law, one count of conspiracy to commit identity theft, credit card fraud, and bank fraud, and two counts of false statements. If convicted, he faces a maximum punishment of 10 years in prison for the civil rights offenses and five years in prison for the conspiracy and false statements offenses.

According to the indictment, on May 23, 2009, Prater assaulted two arrestees who were in custody of the Natchez Police Department, Johnson failed to protect an arrestee in his patrol car from Prater’s assault, and Johnson stole credit and debit cards from an arrestee in his custody. The indictment further charges that Johnson conspired with his cousin, Patricia Wilson, to fraudulently use the arrestee’s credit and debit cards at a gas station, restaurants, and retail stores in Natchez, Miss., and Vidalia, La. Finally, the indictment charges that Prater and Johnson lied to the FBI during the course of their investigation into these offenses.

Wilson, 34, of Woodville, Miss., previously pleaded guilty to conspiring with Johnson to commit identity theft, credit card fraud and bank fraud.

During her plea, Wilson acknowledged that on May 23, 2009, Johnson arranged a meeting and gave her a credit card, which she believed he had stolen. Johnson, who appeared to be holding a second credit card in his hand, asked Wilson to buy beer for an upcoming party he was throwing. Johnson also informed Wilson that the credit card had a $3,000 credit limit, and told Wilson she could also use the stolen credit card to buy something for herself. Wilson took the credit card to a retail store in Vidalia, La., where she attempted to make a purchase, but the credit card, which had been reported as stolen, was declined. The information to which Wilson pleaded guilty also charges that the police officer made or caused to be made several other charges with the stolen credit and debit cards at retail stores, restaurants and a gas station in Natchez and Vidalia, La.

Wilson faces a maximum penalty of up to five years in prison. Her sentencing date has not yet been scheduled.

The case is being investigated by the Jackson Field Office of the FBI and the Mississippi State Office of the Attorney General. The case is being prosecuted by Trial Attorney Erin Aslan of the Justice Department’s Civil Rights Division and Assistant U.S. Attorney Glenda Haynes of the U.S. Attorney’s Office for the Southern District of Mississippi.

The charges set forth in an indictment are merely accusations and the defendants are presumed innocent until proven guilty.

WASHINGTON – Dominion Oklahoma Texas Exploration & Production Inc. and Marathon Oil Company have agreed to pay the United States $2,219,974.98 and $4,697,476.57, respectively, to resolve claims that the two companies separately violated the False Claims Act by knowingly underpaying royalties owed on natural gas produced from federal and Indian leases, the Justice Department announced today. Marathon is among the world’s leading integrated energy companies with operations around the globe, and Dominion is one of the nation’s largest producers and transporters of energy.

The Bureau of Ocean Energy Management, Regulation and Enforcement (BOEM) (formerly known as the Minerals Management Service) of the U.S. Department of the Interior is responsible for collecting and disbursing royalties from energy production that occurs on federal and American Indian lands, both on shore and offshore. Each month, companies are required to report to BOEM the value of the natural gas produced from their federal and Indian leases and to pay a percentage of the reported value as royalties. These settlements resolve claims that Dominion and Marathon improperly deducted from royalty values the cost of boosting gas up to pipeline pressures, and that Dominion improperly reported processed gas as unprocessed gas to reduce royalty payments.

"Mineral royalties provide an important source of income for Native Americans, the United States and various states," said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice. "We are committed to protecting public and Indian lands and to ensuring that companies with leases to take natural gas from those lands pay their fair share of royalties."

"The Department of Justice must remain vigilant in protecting both American and tribal financial interests from unscrupulous business practices," said John Bales, U.S. Attorney for the Eastern District of Texas. "These latest two settlements underscore that commitment."

"We will aggressively pursue every dollar due to American citizens from energy production on federal and American Indian lands," said BOEM Director Michael R. Bromwich. "That means companies must accurately report and pay the proper royalties on a monthly basis, with no exceptions."

The settlements with Dominion and Marathon arise from a lawsuit filed by Harold Wright under the False Claims Act. Under the qui tam, or whistleblower, provisions of the act, private citizens may file actions on behalf of the United States and share in any recovery. Because Mr. Wright is deceased, his heirs will receive a $1.822 million share of the settlements. The Justice Department intervened against several defendants in the Wright lawsuit. Settlements in the case to date include agreements with Burlington Resources for $105.3 million, with Shell for $56 million, with Chevron, Texaco and Unocal for $45.5 million, and with Mobil for $32.2 million.

The investigation and settlement of these matters were jointly handled by the Justice Department’s Civil Division and the U.S. Attorney for the Eastern District of Texas, with assistance from the Department of the Interior’s Office of Inspector General, BOEM and Office of the Solicitor.

The case is U.S. ex rel. Wright v. Chevron USA, Inc. et al., 5:03-CV-264 (E.D. Tex.)

WASHINGTON — The Department of Justice and the U.S. Department of Agriculture (USDA) announced today the agenda and panelists for the Aug. 27, 2010, joint public workshop in Fort Collins, Colo., on competition in the livestock industry. This is the fourth in a series of five public workshops. This workshop is focused on the state of competition and regulation in the livestock sectors, in particular the cattle industry.

 

The workshop will be held in the main ballroom of the Lory Student Center, Colorado State University, 1101 Centre Avenue Mall, Fort Collins. Attendance is free and open to the public. The general public and media interested in attending the Colorado workshop should register at www.conferences.colostate.edu/LiveStockWorkshop.

 

The workshop will begin with opening remarks and a roundtable discussion including U.S. Attorney General Eric Holder, U.S. Agriculture Secretary Tom Vilsack and Assistant Attorney General for the Justice Department’s Antitrust Division Christine Varney. They will be joined by U.S. Rep. Betsy Markey, Colorado Governor Bill Ritter, Colorado Attorney General John Suthers, Colorado Commissioner of Agriculture John Stulp and Montana Attorney General Steve Bullock.

 

Following this introductory discussion, there will be three panels composed of ranchers, farmers, academics and other industry stakeholders. First, Secretary Vilsack and Assistant Attorney General Varney will moderate a conversation among producers and feeders. Second, a panel on trends will look at developments in the industry in recent decades and the trajectory moving forward. The final panel will then discuss in greater depth issues such as contracting, transparency and vertical integration.

 

Additionally, there will be three hours dedicated to public testimony. This will be split into two sessions, one at mid-day and the other after the final panel.

 

The schedule for the day is as follows:

8:30 a.m – 8:45 a.m. MDT Opening Remarks

 

Eric Holder, Attorney General, U.S. Department of Justice

Tom Vilsack, Secretary of Agriculture, U.S. Department of Agriculture

8:45 a.m. – 9:45 a.m. MDT Keynote Roundtable Discussion

 

Eric Holder, Attorney General, U.S. Department of Justice

Tom Vilsack, Secretary of Agriculture, U.S. Department of Agriculture

Christine Varney, Assistant Attorney General, Antitrust Division, U.S. Department of Justice

Betsy Markey, Congresswoman, U.S. House of Representatives

Bill Ritter Jr., Governor, state of Colorado

John Suthers, Attorney General, state of Colorado

Steve Bullock, Attorney General, state of Montana

John Stulp, Commissioner of Agriculture, state of Colorado

 

9:45 a.m. – 10:15 a.m. MDT              Coffee Break

10:15 a.m. – 11:45 a.m. MDT Producer/Feeder Presentation of Issues

 

This panel will be an opportunity to hear first-hand from producers or feeders as they share their experiences and perspectives on the industry.

 

Moderators: Tom Vilsack, Secretary of Agriculture, U.S. Department of Agriculture

                         Christine Varney, Assistant Attorney General, Antitrust Division, U.S. Department of Justice

 

Mike Harper, sheep producer, Eaton, Colo.

Dr. Taylor Haynes, rancher, Cheyenne, Wyo.

Robbie LeValley, rancher, Hotchkiss, Colo.

Harry Livermont, rancher, Interior, S.D.

Chris Petersen, hog farmer, Clear Lake, Iowa

Allen Sents, feedlot owner, Marquette, Kan.

Alden Zuhlke, rancher, Brunswick, Neb.

11:45 a.m. – 12:30 p.m. MDT Lunch

 

12:30 p.m. – 1:30 p.m. MDT              Public Testimony

 

1:30 p.m. – 2:45 p.m. MDT  Panel I – Trends in the Livestock Industry

 

This panel will discuss trends in the livestock industry, including issues associated with contracting, price transparency and the effects of concentration.

 

Moderator: Philip Weiser, Deputy Assistant Attorney General, Antitrust Division, U.S. Department of Justice

 

Jerry Bohn, general manager, Pratt Feeders, Pratt, Kan.

Libby Cook, co-founder, Wild Oats Markets and Sunflower Farmers Markets

Mark Greenwood, vice president, commercial lending, AgStar Financial Services

Bill Heffernan, professor emeritus of rural sociology, University of Missouri

Mark Lauritsen, international vice president, director food processing, packing and manufacturing division, United Food and Commercial Workers International Union

Gilles Stockton, rancher, Range, Mont.

Armando Valdez, rancher, La Jara, Colo.

Clem Ward, professor and extension economist, Oklahoma State University

2:45 p.m. – 4:00 p.m. MDT Panel II – Market Structure

 

This panel will include a variety of market participants who will discuss market structure issues in the livestock industry.

 

Moderator: James MacDonald, Chief, Agricultural Structure and Productivity Branch, Economic Research Service, U.S. Department of Agriculture

 

Bruce Cobb, general manager, Consolidated Beef Producers

David Domina, attorney, Domina Law Group

Mark Dopp, attorney, American Meat Institute

James Herring, president and chief executive officer, Friona Industries

Robert Mack, cattle producer/feeder, Watertown, S.D.

Bob Miller, rancher, Okmulgee, Okla.

William Rishel, Richel Angus, Platt, Neb.

Charlie Rogers, owner/general manager, Clovis Livestock Auction

 

4:00 p.m. – 4:15 p.m. MDT Break

 

4:15 p.m. – 6:30 p.m. MDT Public Testimony

 

6:30 p.m. MDT Concluding Remarks

Additional information, including submitted public comments and transcripts for past workshops can be found at the Antitrust Division’s agriculture workshop website at www.justice.gov/atr/public/workshops/ag2010/index.htm. While no streaming webcast will be available, transcripts and video will be available for this workshop at a later date on the Antitrust Division’s website. Individuals seeking more information on the workshops should contact [email protected].

 

Media who wish to attend the workshop may begin arriving at 7:00 a.m. MDT and cameras must be pre-set by 8:00 a.m. MDT. Press inquiries regarding logistics at the Lory Student Center at Colorado State University should be directed to Brad Bohlander at [email protected] or 970-491-1545.

 

LOS ANGELES – Charles Yi and John Bostick were arrested Wednesday for violations of the Clean Air Act’s asbestos work practice standards committed during the renovation of a 204-unit apartment building in Winnetka, Calif., in January through February of 2006, the Justice Department announced today.

The arrest follows a six-count indictment returned against Yi and Bostick by a federal grand jury in Los Angeles on July 22, 2010. The indictment also charged the defendants with conspiracy to violate the Clean Air Act.

The Clean Air Act requires those who remove asbestos from buildings to adhere to established work practice standards to ensure the safe removal, transportation, and disposal of the asbestos.

The defendants were high level officers of three companies that purchased the property and oversaw its renovation and conversion for sale as condominiums. The indictment alleges that, despite having knowledge of asbestos contained in the acoustical or "popcorn" ceilings of the apartment units, the defendants hired a company that was not licensed or trained in asbestos abatement to scrape the ceilings of the units without telling the company’s workers of the asbestos in the ceilings or providing them with adequate protective gear.

The indictment charges the defendants with violations of several asbestos worker protection standards, including failing to notify the government of the asbestos abatement project, failing to have a foremen on site trained in the asbestos regulations, failing to keep the asbestos waste material wet during the abatement, failing to contain the asbestos waste material in air tight containers and failing to dispose of the asbestos waste material at a hazardous waste disposal site.

If convicted, the defendants face up to five years in prison as well as a criminal fine of up to $250,000 for each count.

The allegations in the indictment are mere accusations and all persons are presumed innocent until and unless proven guilty beyond a reasonable doubt in a court of law.

The case was investigated by the Criminal Investigation Division of the U.S. Environmental Protection Agency and the California South Coast Air Quality Management District. The case is being prosecuted by the U.S. Attorney’s Office for the Central District of California and the Justice Department’s Environmental Crimes Section.

WASHINGTON A former U.S. Army Sergeant pleaded guilty today to bribery in connection with a fuel theft scheme to solicit more than $400,000 in bribes from a government contractor in Afghanistan, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division and U.S. Attorney Neil H. MacBride of the Eastern District of Virginia.

 

Michael Dugger, 27, of Jonesboro, Ga., pleaded guilty today before U.S. District Court Judge T. S. Ellis, III in the Eastern District of Virginia to a one-count criminal information charging him with bribery as a public official. Dugger was originally charged in a criminal complaint filed on June 24, 2010. The complaint charged him and Stevan Nathan Ringo, a former U.S. Army staff sergeant in Afghanistan, with one count of conspiracy to commit theft of government property. The charge against Ringo remains pending. The charge in the complaint is merely an allegation, and the defendant is presumed innocent unless and until proven guilty.

 

According to court documents, Ringo and Dugger were stationed at Forward Operating Base (FOB) Shank, a U.S. Army installation in the Logar Province of Eastern Afghanistan. FOB Shank supports U.S. military operations in Afghanistan in various ways, including through fuel receipt and redistribution. More specifically, the Army stores large quantities of fuel at FOB Shank and redistributes that fuel to installations in the surrounding area through government contractors. Dugger’s responsibilities included supervision of FOB Shank’s fuel redistribution process.

 

In his guilty plea, Dugger admitted that between January and February 2010 he aided and abetted a co-conspirator’s solicitation and acceptance of more than $400,000 in bribes from a government contractor, all in exchange for his co-conspirator’s creation and submission of fraudulent paperwork permitting that contractor to steal fuel from FOB Shank. Dugger also admitted that he helped his co-conspirator conceal the money in various locations in and around FOB Shank. The total value of the fuel stolen during the course of the scheme was at least $1.39 million.

 

At sentencing, Dugger faces a maximum penalty of 15 years in prison and a fine of $250,000; twice the gross gain or loss from the scheme; or three times the value of the payments solicited or received. Dugger’s sentencing is currently scheduled for Nov. 5, 2010, at 9:00 a.m.

 

The case is being prosecuted by Trial Attorney Ryan S. Faulconer of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Edmund P. Power for the Eastern District of Virginia. Substantial assistance was provided by Trial Attorney Dan E. Stigall of the Criminal Division’s Office of International Affairs. The case is being investigated by the FBI, the Defense Criminal Investigative Service, the U.S. Army Criminal Investigative Division, other military law enforcement at FOB Shank, and members of the National Procurement Fraud Task Force (NPFTF) and the International Contract Corruption Task Force (ICCTF).

 

The NPFTF, created in October 2006 by the Department of Justice, was designed to promote the early detection, identification, prevention and prosecution of procurement fraud associated with the increase in government contracting activity for national security and other government programs. The ICCTF is a joint law enforcement agency task force that seeks to detect, investigate, and dismantle corruption and contract fraud resulting from U.S. Overseas Contingency Operations worldwide, including in Kuwait, Afghanistan and Iraq.

WASHINGTON – The Department of Justice and the Federal Trade Commission (FTC) issued today revised Horizontal Merger Guidelines that outline how the federal antitrust agencies evaluate the likely competitive impact of mergers and whether those mergers comply with U.S. antitrust law. These changes mark the first major revision of the merger guidelines in 18 years, and will give businesses a better understanding of how the agencies evaluate proposed mergers.

A primary goal of the 2010 guidelines is to help the agencies identify and challenge competitively harmful mergers while avoiding unnecessary interference with mergers that either are competitively beneficial or likely will have no competitive impact on the marketplace. To accomplish this, the guidelines detail the techniques and main types of evidence the agencies typically use to predict whether horizontal mergers may substantially lessen competition.

The revised merger guidelines derive from the agencies’ collective experience in assessing thousands of transactions focusing on the types of evidence the department and the FTC use to decide whether a merger of competitors may harm competition. Many of the proposed refinements and changes reflect issues previously identified in the "Commentary on the Horizontal Merger Guidelines," which the agencies jointly issued in 2006. In crafting the revisions, the agencies considered a wide range of opinions gathered through a series of joint public workshops, as well as hundreds of public comments submitted by attorneys, academics, economists, consumer groups and businesses.

"The revised guidelines better reflect the agencies’ actual practices," said Christine Varney, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. "The guidelines provide more clarity and transparency, and will provide businesses with an even greater understanding of how we review transactions. This has been a successful process due to the commitment of the talented staff from both agencies and the excellent working relationship with the FTC led by Jon Leibowitz."

"Because of the hard work of all involved at both agencies, private parties and judges will be better equipped to understand how the agencies evaluate deals. That improvement in clarity and predictability will benefit everyone," said FTC Chairman Jon Leibowitz. "We thank Christine Varney and her team at DOJ for their terrific work on this initiative, demonstrating once again how effectively and collegially the two agencies work together."

The agencies jointly announced the project in September 2009, followed by a series of workshops over the course of the winter. The FTC issued proposed revisions for public comment on April 20, 2010. All of the written comments are posted on the FTC’s website at www.ftc.gov/os/comments/hmgrevisedguides/index.shtm.

The 2010 guidelines are different from the 1992 guidelines in several important ways. The guidelines:

• Clarify that merger analysis does not use a single methodology, but is a fact-specific process through which the agencies use a variety of tools to analyze the evidence to determine whether a merger may substantially lessen competition.
• Introduce a new section on "Evidence of Adverse Competitive Effects." This section discusses several categories and sources of evidence that the agencies, in their experience, have found informative in predicting the likely competitive effects of mergers.
• Explain that market definition is not an end itself or a necessary starting point of merger analysis, and market concentration is a tool that is useful to the extent it illuminates the merger’s likely competitive effects.
• Provide an updated explanation of the hypothetical monopolist test used to define relevant antitrust markets and how the agencies implement that test in practice.
• Update the concentration thresholds that determine whether a transaction warrants further scrutiny by the agencies.
• Provide an expanded discussion of how the agencies evaluate unilateral competitive effects, including effects on innovation.
• Provide an updated section on coordinated effects. The guidelines clarify that coordinated effects, like unilateral effects, include conduct not otherwise condemned by the antitrust laws.
• Provide a simplified discussion of how the agencies evaluate whether entry into the relevant market is so easy that a merger is not likely to enhance market power.
• Add new sections on powerful buyers, mergers between competing buyers, and partial acquisitions.

The 2010 guidelines are available on the Department of Justice’s website at www.justice.gov/atr/public/guidelines/hmg-2010.html.

The Horizontal Merger Guidelines, which were first adopted in 1968, and revised in 1992, serve as an outline of the main analytical techniques, practices and enforcement policies the Department of Justice and the FTC use to evaluate mergers and acquisitions involving actual or potential competitors under federal antitrust laws.

The guidelines issued today take into account the legal and economic developments since the 1992 guidelines were issued. They are not intended to represent a change in the direction of merger review policy, but to offer more clarity on the merger review process to better assist the business community and, in particular, parties to mergers and acquisitions.

The Bank Merger Competitive Review guidelines, which the federal banking agencies and the Department of Justice developed in 1995 to facilitate the competitive review of bank mergers, remain unchanged. The Bank Merger Competitive Review guidelines can be found at http://www.justice.gov/atr/merger-enforcement.

WASHINGTON – The Drug Enforcement Administration (DEA) and government, community, public health and law enforcement partners today announced a nationwide prescription drug "Take-Back" initiative that seeks to prevent increased pill abuse and theft. DEA will be collecting potentially dangerous expired, unused and unwanted prescription drugs for destruction at sites nationwide on Saturday, Sept. 25, 2010, from 10 A.M.-2 P.M. local time. The service is free and anonymous, no questions asked.

This initiative addresses a vital public safety and public health issue. Many Americans are not aware that medicines that languish in home cabinets are highly susceptible to diversion, misuse and abuse. Rates of prescription drug abuse in the United States are increasing at alarming rates, as are the number of accidental poisonings and overdoses due to these drugs. Studies show that a majority of abused prescription drugs are obtained from family and friends, including from the home medicine cabinet. In addition, many Americans do not know how to properly dispose of their unused medicine, often flushing them down the toilet or throwing them away – both potential safety and health hazards.

"With this National Prescription Drug Take-Back campaign, we are aggressively reaching out to individuals to encourage them to rid their households of unused prescription drugs that pose a safety hazard and can contribute to prescription drug abuse," said Acting Deputy Attorney General Gary G. Grindler. "The Department of Justice is committed to doing everything we can to make our communities safer, and this initiative represents a new front in our efforts."

"Today we are launching a first-ever National Prescription Drug Take-Back campaign that will provide a safe way for Americans to dispose of their unwanted prescription drugs," said Michele M. Leonhart, Acting Administrator of the Drug Enforcement Administration. "This effort symbolizes DEA’s commitment to halting the disturbing rise in addiction caused by their misuse and abuse. Working together with our state and local partners, the medical community, anti-drug coalitions, and a concerned public, we will eliminate a major source of abused prescription drugs, and reduce the hazard they pose to our families and communities in a safe, legal, and environmentally sound way."

"Prescription drug abuse is the Nation’s fastest-growing drug problem, and take-back events like this one are an indispensable tool for reducing the threat that the diversion and abuse of these drugs pose to public health," said Director of National Drug Control Policy Gil Kerlikowske. "The Federal/state/and local collaboration represented in this initiative is key in our national efforts to reduce pharmaceutical drug diversion and abuse."

Collection sites in every local community can be found by going to www.dea.gov. This site will be continuously updated with new take-back locations. Other participants in this initiative include the White House Office of National Drug Control Policy; the Partnership for a Drug-Free America; the International Association of Chiefs of Police; the National Association of Attorneys General; the National Association of Boards of Pharmacy; the Federation of State Medical Boards; and the National District Attorneys Association.

WASHINGTON – Two defendants were sentenced today to prison in connection with a series of superseding indictments charging 26 individuals for their participation in an online child pornography conspiracy, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division and U.S. Attorney Timothy M. Morrison of the Southern District of Indiana.

 

Roger Lee Loughry Sr., 57, of Baltimore, Md., was sentenced by U.S. District Court Judge William T. Lawrence in the Southern District of Indiana to 30 years in prison for his role as an administrator of an online bulletin board. On April 15, 2010, Loughry was convicted by a federal jury in the Southern District of Indiana following a four-day trial. Loughry was found guilty of one count of conspiracy to advertise child pornography, one count of conspiracy to distribute child pornography, 12 counts of advertising child pornography and two counts of distributing child pornography.

 

Evidence presented at trial revealed that Loughry had been an active member of the child pornography bulletin board since November 2005 and had participated in numerous administrative functions on the online board during his membership, including adding new members to the board. In addition, evidence introduced at trial established that Loughry’s home was searched in September 2008, at which time computers and computer media were seized. According to trial evidence, upon review of the seized materials, investigators discovered images and videos depicting the sexual abuse of minors, including videos in which adult males were engaged in sexual intercourse with prepubescent girls.

 

Charles Trull, 43, of Carterville, Ill., was sentenced today by Judge Lawrence to 19 years in prison for his role in the child pornography conspiracy. Trull pleaded guilty on April 7, 2010, to one count of conspiracy to advertise child pornography, one count of conspiracy to distribute child pornography, and two counts of advertising child pornography before Judge Lawrence in Indianapolis. During the sentencing hearing, the government presented testimony showing that Trull produced child pornography involving a minor girl over a three-year period while she was only 13 to 15 years of age.  Trull then sent multiple images of her to numerous members of several internet bulletin boards trafficking in child pornography.

 

Loughry and Trull also were sentenced to lifetime supervised release following their respective prison terms.

 

The charges against Loughry, Trull and 24 co-defendants are a result of “Operation Nest Egg,” an ongoing and joint investigation led by the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), the U.S. Attorney’s Office for the Southern District of Indiana, the U.S. Postal Inspection Service (USPIS) and U.S. Immigration and Customs Enforcement (ICE). Operation Nest Egg, launched in February 2008, targeted 26 defendants charged in the Southern District of Indiana, as well as approximately 500 additional individuals located throughout the world for their involvement in an online group dedicated to trading images of child pornography.

 

According to court documents filed in the Southern District of Indiana, the 26 co-conspirators participated in a sophisticated, password-protected Internet bulletin board group, which existed to allow members to meet like-minded individuals with a sexualized interest in children, to discuss that interest and to trade images of child pornography. The defendants are charged with conspiring to advertise and distribute child pornography, along with substantive counts of advertising and distributing child pornography. Twenty-two of the 26 defendants charged in the conspiracy have been arrested. Twenty of the 22 individuals arrested have been convicted or have pleaded guilty. Fifteen of the 20 individuals who have pleaded guilty for their role in the conspiracy have been sentenced to prison on previous dates.

 

Four of the 26 individuals charged in the conspiracy remain at large and are known only by their online identities. Efforts to identify and apprehend these four individuals continue.

 

To date, as a result of Operation Nest Egg, more than 80 searches have been conducted in the United States. In total, more than 50 individuals have been arrested and 40 individuals have been convicted. The investigation is ongoing. Numerous members of the Internet-based bulletin board were found to have been personally sexually abusing children. For example, lead administrator Delwyn Savigar of the United Kingdom was identified and arrested in partnership with the U.K.’s Child Exploitation and Online Protection Centre, for his involvement in the conspiracy. After his initial arrest, Savigar was identified through DNA testing as the perpetrator of a previously unsolved sexual assault against a minor female in Great Britain, to which he pleaded guilty. Following this discovery, Savigar was linked to additional incidents of sexual assaults. Ultimately, he pleaded guilty to either abusing or attempting to abuse three minors from 1999 to 2002. He was sentenced to 14 years in prison in the United Kingdom. To date, 16 child victims have been identified through Operation Nest Egg.

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

 

The case is being prosecuted by Assistant U.S. Attorney Steven D. DeBrota of the Southern District of Indiana, Assistant U.S. Attorney of the Eastern District of Virginia and former CEOS Trial Attorney Elizabeth M. Yusi and CEOS Trial Attorney Alecia Riewerts Wolak. The investigation was conducted jointly by CEOS’ High Technology Investigative Unit, USPIS and ICE, with assistance provided by the Indiana Internet Crimes Against Children (ICAC) Taskforce, Indiana State Police, and numerous local and international law enforcement agencies across the United States and Europe.

 

WASHINGTON – Andrew Cole pleaded guilty today to racketeering conspiracy and fraud in foreign labor contracting charges arising from his role in a criminal enterprise that engaged in numerous criminal activities, including forced labor, fraud in foreign labor contracting, visa fraud, mail fraud, identity theft, tax evasion and money laundering, the Justice Department announced today.

According to court documents, Cole recruited various foreign nationals from the Dominican Republic by falsely representing the terms, conditions and nature of their employment as hotel workers in the Kansas City area. At the time Cole recruited these foreign nationals, he knew that they would not be paid the wages promised, that many would be sent to work in factory positions in Alabama and that threats of deportation and other adverse immigration consequences would be made to the foreign nationals by members of the criminal enterprise in order to maintain the foreign nationals’ labor.

"The defendant took advantage of foreign workers’ hopes to live the American Dream. He recruited them with false promises and with the knowledge that these workers would be exploited and their labor coerced," said Assistant Attorney General for the Civil Rights Division Thomas E. Perez. "The Department of Justice will continue to vigorously prosecute these cases."

Multiple co-defendants have previously pleaded guilty in connection with the case. Ilkham Fazilov pleaded guilty on Aug 9, 2010, to racketeering conspiracy for his role in aiding and abetting others in the scheme. Jakhongir Kakhkharov also pleaded guilty to racketeering conspiracy on March 17, 2010. Alexandru Frumusache pleaded guilty on Oct. 7, 2009, to forced labor trafficking. Trial for the remaining defendants is set for Oct. 18, 2010.

The case was investigated by the Department of Homeland Security, the FBI, the Department of Labor, the Internal Revenue Service, the Kansas Department of Revenue and the Independence, Mo., Police Department. U.S. Attorney Criminal Chief Gene Porter, Assistant U.S. Attorney William Meiners and Civil Rights Division Human Trafficking Prosecution Unit Trial Attorney Jim Felte prosecuted this case for the government.

WASHINGTON – Farmington Hills, Mich., physician Jose Castro-Ramirez was sentenced today to 14 years in prison for his role in a wide-ranging conspiracy to defraud the Medicare program, the Departments of Justice and Health and Human Services announced. Castro-Ramirez was also ordered to pay $9.4 million in restitution and sentenced to a three-year term of supervised release following his prison term.

 

On March 11, 2010, after a three-week trial, a federal jury convicted Castro-Ramirez of one count of conspiracy to commit health care fraud, 11 counts of health care fraud and one count of conspiracy to launder the proceeds of the fraudulent scheme. Castro-Ramirez was sentenced today by U.S. District Judge Sean F. Cox in the Eastern District of Michigan.

 

Evidence at trial established that beginning in 2003, the defendant, a physician licensed in the state of Michigan, entered into an agreement with co-conspirator Suresh Chand to defraud the Medicare program. Chand, who was sentenced to 81 months in prison in April for his role in the scheme, owned and controlled several companies operating in Warren, Mich., including Continental Rehab Services Inc. (CRS), and Pacific Management Services Inc. (PM), that purported to provide physical and occupational therapy services to Medicare beneficiaries. In reality, Chand and his associates at CRS and PM created fictitious therapy files, appearing to document physical and occupational therapy services provided to Medicare beneficiaries, when in fact no such services had been provided. The fictitious services reflected in the files were billed to Medicare through sham Medicare providers controlled by Chand and his co-conspirators. The fictitious therapy files Chand and his co-conspirators created would appear to justify the billings to Medicare, when in fact no physical or occupational therapy services had been provided.

 

Evidence introduced at trial established that in order to create the fictitious therapy files, Chand and his co-conspirators paid cash kickbacks and other inducements to Medicare beneficiaries, in exchange for the beneficiaries’ Medicare numbers and signatures on documents falsely indicating that they had received therapy services. Chand also would pay licensed physical and occupational therapists to sign fictitious “progress notes” and other documents that appeared to reflect that physical and occupational therapy services had been provided to the beneficiaries, when in fact they had not. Castro-Ramirez, as the physician participant in the scheme, would sign therapy prescriptions and other documents in the fictitious therapy files falsely indicating that he had evaluated the Medicare beneficiaries and certified the need for physical and occupational therapy services. In fact, Castro-Ramirez did not oversee any treatment provided to the patients and was fully aware that his signatures were part of a fraudulent scheme.

 

One of the inducements that Chand and his co-conspirators used to recruit Medicare beneficiaries into the scheme was the provision of prescriptions for controlled substances and other drugs, including vicodin and xanax. Over the course of the scheme, Chand would provide Castro-Ramirez with lists of the controlled substances or drugs the beneficiaries preferred, and Castro-Ramirez would write prescriptions for the substances without ever seeing the patients. Between January 2003 and March 2007, Castro-Ramirez wrote thousands of prescriptions for a variety of drugs for patients that he had never seen. Castro-Ramirez was fully aware that the purpose of the prescriptions was to induce beneficiaries into the scheme, so that Chand and others could bill Medicare for physical and occupational therapy services purportedly provided to the patients, when in fact, such services had never been provided.

 

Evidence at trial demonstrated that Castro-Ramirez profited from his participation in the scheme in several ways. Castro-Ramirez’s largest source of fraudulent proceeds came from his own billings to Medicare for “home visits” that he purportedly made to Medicare beneficiaries Chand recruited into the scheme. In fact, Castro-Ramirez never conducted “home visits” with the vast majority of these patients, and never discussed or ordered therapy services for the few he did see. Chand and other co-conspirators also distributed proceeds of the fraud directly to Castro-Ramirez on occasion, and did so through transactions designed to disguise the nature, source, ownership, control and location of the tainted funds. Castro-Ramirez knew that the cash and checks he received from Chand were structured so as to conceal the fact that they were proceeds of Medicare fraud.

 

Between approximately January 2003 and approximately June 2007, Chand and his co-conspirators submitted claims to the Medicare program totaling approximately $18.3 million for physical and occupational therapy services that were supposedly ordered and supervised by Castro-Ramirez but were in fact never rendered. Medicare actually paid approximately $8.5 million on those claims. In addition, Castro-Ramirez submitted approximately $1.4 million in claims to the Medicare program for “home visits” purportedly provided to beneficiaries recruited into the scheme by Chand and his co-conspirators. Medicare actually paid approximately $929,000 on those claims.

 

Today’s sentencing was announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade; Special Agent in Charge Andrew G. Arena of the FBI’s Detroit Field Office; and Special Agent in Charge Lamont Pugh III of the HHS Office of Inspector General’s (HHS-OIG) Chicago Regional Office.

The case was prosecuted by Assistant Chief John K. Neal of the Criminal Division’s Fraud Section and Special Assistant United States Attorney Thomas W. Beimers of the U.S. Attorney’s Office for the Eastern District of Michigan. The FBI and the HHS Office of Inspector General (HHS-OIG) conducted the investigation.

 

Since their inception in March 2007, Medicare Fraud Strike Force operations in seven districts have obtained indictments of more than 810 individuals who collectively have falsely billed the Medicare program for more than $1.85 billion.  In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

 

To learn more about the HEAT team, go to: www.stopmedicarefraud.gov.

WASHINGTON – Cheese manufacturer Sorrento Lactalis Inc. will pay the United States a $315,000 penalty for excess discharges in violation of its wastewater permit levels, according to an agreement between the company, the Justice Department and the Environmental Protection Agency (EPA). The company discharged the excess pollutants into Mason Creek from its factory operations in Nampa, Idaho, in violation of the Clean Water Act.

Sorrento, which treats wastewater in a facility separate from its cheese-making plant, repeatedly violated its National Pollutant Discharge Elimination System (NPDES) permit over a period of three years from December 2005 to September 2008.

The violations include:

• Failure to collect and analyze samples;
• Exceeding its monthly and daily discharge limits for total suspended solids, E. coli, biological oxygen demand, phosphorus and pH; and
• Failure to notify EPA of its excess discharges in a timely manner

Mason Creek flows into the Boise River. Pollutants can degrade water quality, cause harm to fish and other wildlife, and diminish the recreational value of the waters.

Under its NPDES permit, Sorrento discharges approximately 650,000 gallons per day of process wastewater. Sorrento has brought its Nampa facility into compliance with its permit.

"The Justice Department will strenuously enforce compliance with regulations that protect our waterways," said Ignacia S. Moreno, Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. "We will continue to seek penalties when companies fail to comply with their permit obligations."

"Companies like Sorrento must manage their waste responsibly and pay close attention to the limits in their permits, said Jim Werntz, Director of the EPA Idaho Office. "We will fine facilities that violate their permit limits and degrade the water quality of Idaho’s rivers and streams."

The Boise River is a salmon habitat with strict water quality limits for nutrients, including phosphorus. Phosphorus can negatively affect salmon habitat by promoting algae growth, which depletes oxygen levels and impacts organisms such as fish.

The National Pollutant Discharge Elimination System permit program controls water pollution by regulating point sources that discharge pollutants to surface waters.

WASHINGTON – Barclays Bank PLC, a United Kingdom corporation headquartered in London, has agreed to forfeit $298 million to the United States and to the New York County District Attorney’s Office in connection with violations of the International Emergency Economic Powers Act (IEEPA) and the Trading with the Enemy Act (TWEA), announced Assistant Attorney General Lanny A. Breuer of the Criminal Division and District Attorney Cyrus R. Vance Jr., of the New York County District Attorney’s Office. The violations relate to transactions Barclays illegally conducted on behalf of customers from Cuba, Iran, Sudan and other countries sanctioned in programs administered by the Office of Foreign Assets Control (OFAC).

 A criminal information was filed Aug. 16, 2010, in the U.S. District Court for the District of Columbia charging Barclays with one count of violating the IEEPA and one count of violating the TWEA.  Barclays waived indictment, agreed to the filing of the information, and has accepted and acknowledged responsibility for its criminal conduct.  Barclays agreed to forfeit the funds as part of the deferred prosecution agreements reached with the Department of Justice and the New York County District Attorney’s Office. The deferred prosecution agreement was approved today by U.S. District Court Judge Emmet G. Sullivan.

"Banks like Barclays will not be permitted to disregard sanctions put in place by the U.S. government," said Assistant Attorney General Lanny A. Breuer of the Criminal Division.  "Not just once, but numerous times over more than a decade, Barclays stripped vital information out of payment messages that would have alerted U.S. financial institutions about the true origins of the funds.  This serious conduct has now resulted in a serious sanction – forfeiture of $298 million, a public admission of its illegal acts, and the implementation of stringent compliance measures.  As I’ve said repeatedly, when corporations self-disclose their criminal wrongdoing to us, as Barclays did, they will not get a pass, but we will take their disclosure, cooperation and remedial efforts into consideration."

"Criminal activity of the type we found at Barclays does more than deceive our financial institutions, it threatens the security of our country," said District Attorney Cyrus R. Vance Jr. "The Manhattan District Attorney’s Office has been a leader in these investigations, and I am committed to continuing our work with federal law enforcement agencies in this arena."

"Barclays implemented practices designed to evade U.S. sanctions for the benefit of sanctioned countries and persons," said OFAC Director Adam J. Szubin. "The substantial economic benefit to sanctioned parties and the systemic nature of the apparent violations could have resulted in a much more onerous OFAC fine had Barclays not voluntarily self-disclosed and had it not cooperated with OFAC throughout the investigation. This is the first settlement of this magnitude where OFAC determined that all of the apparent violations were voluntarily self-disclosed by the bank."

Under IEEPA and TWEA, it is a crime to willfully violate, or attempt to violate, any regulation issued under the act, including those related to Cuba, Iran, Libya, Sudan and Burma. The IEEPA and TWEA regulations are administered by OFAC.

According to court documents, from as early as the mid-1990s until September 2006, Barclays knowingly and willfully moved or permitted to be moved hundreds of millions of dollars through the U.S. financial system on behalf of banks from Cuba, Iran, Libya, Sudan and Burma, and persons listed as parties or jurisdictions sanctioned by OFAC in violation of U.S. economic sanctions.

According to court documents, Barclays followed instructions, principally from banks in Cuba, Iran, Libya, Sudan and Burma, not to mention their names in U.S. dollar payment messages sent to Barclays’ branch in New York and to other financial institutions located in the United States. Barclays routed U.S. dollar payments through an internal Barclays account to hide the payments’ connection to OFAC-sanctioned entities and amended and reformatted the U.S dollar payment messages to remove information identifying the sanctioned entities. Barclays also deliberately used a less transparent method of payment messages, known as cover payments, as another way of hiding the sanctioned entities identifying information.

"Barclays Bank has admitted a decade-long pattern of violating U.S. banking laws, and taking certain steps to conceal prohibited transactions," said FBI Assistant Director-in-Charge Janice K. Fedarcyk.  "Corporate responsibility entails more than just acting discreetly on behalf of one’s clients.  It means, first and foremost, acting lawfully."

"In the world’s increasingly complex financial markets, it’s critical that global institutions follow U.S. law, including sanctions against other countries," said Victor S. O. Song, Chief, Internal Revenue Service (IRS) Criminal Investigation.  "The IRS is proud to share its hallmark financial investigative expertise in this and other increasingly sophisticated financial investigations.  Creating new strategies of cooperation among governments on international financial compliance is a top priority for the IRS."

Barclay’s forfeiture of $149 million to the United States and $149 million to the New York County District Attorney’s Office will settle forfeiture claims by the Department of Justice and the state of New York.  In light of the bank’s remedial actions to date and its willingness to acknowledge responsibility for its actions, the department will recommend the dismissal of the information in two years, provided Barclays fully cooperates with, and abides by, the terms of the deferred prosecution agreement.

OFAC has also entered into a settlement agreement with Barclays for IEEPA violations that will require Barclays to pay $176 million, which is concurrent with the forfeiture paid as a result of the deferred prosecution agreements. The Federal Reserve Board and the New York State Banking Department announced today the issuance of a consent order to cease and desist against Barclays.  The order requires Barclays to improve its program for compliance with U.S. economic sanctions requirements on a global basis.

The case was prosecuted by Senior Trial Attorney Frederick Reynolds and Trial Attorney Kevin Gerrity of the Criminal Division’s Asset Forfeiture and Money Laundering Section (AFMLS).  The case was investigated by the FBI’s New York Field Office and the IRS-Criminal Investigation’s Washington Field Division and Jeremy Wade and Laurie Bender of AFMLS. The Department of Justice expresses gratitude to Executive Assistant District Attorney, Chief of Investigation Division Adam Kaufmann; Principal Deputy Bureau Chief Gary Fishman; Assistant District Attorneys Richard Preiss and Aaron Wolfson of the New York County District Attorney’s Office, Major Economic Crimes Bureau. The Department of Justice also expresses gratitude to the OFAC, the Federal Reserve Bank of New York, the Board of Governors of the Federal Reserve System and the New York State Banking Department for their significant and valuable assistance.

WASHINGTON – The Justice Department today issued a letter to chief justices and administrators of state courts clarifying the obligation of courts that receive federal financial assistance to provide oral interpretation, written translation and other language services to people who are limited English proficient (LEP).  This month marks the 10th anniversary of Executive Order 13166 which requires federal agencies to ensure that recipients of federal financial assistance comply with Title VI of the Civil Rights Act of 1964 by providing meaningful access to LEP persons.

 

Today’s letter provides state courts guidance regarding the requirement to provide meaningful access to their programs and services for LEP persons through the provision of language services, pursuant to the prohibition against national origin discrimination contained in Title VI of the Civil Rights Act of 1964, the Omnibus Crime Control and Safe Streets Act (Safe Streets Act), and their implementing regulations. The letter includes an overview of applicable civil rights laws, Supreme Court precedent, guidance and illustrative examples of situations that would warrant the provision of language services.

 

The letter explains that applicable civil rights laws require courts receiving federal financial assistance to provide meaningful access to all civil, criminal or administrative hearings, at no charge to LEP individuals.  It further explains that such access should be extended to LEP parties and other LEP individuals whose presence or participation is appropriate to the court proceedings; should be provided in court programs or activities outside of the courtroom; and should include language services for communication between LEP individuals and court appointed or court managed service providers. 

 

“Justice requires that all individuals have meaningful access to the critical services provided by the nation’s state court systems, regardless of the individual’s English language skills,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division.  “As we mark the 10th anniversary of the issuance of Executive Order 13166 this month, it is especially appropriate to remember our shared responsibility to reduce persistent language barriers in court proceedings and services that are of such importance to the daily lives of parties, victims, witnesses and the public.” 

 

For more information about Title VI and the Safe Streets Act, or to obtain copies of the letter, visit www.lep.gov. 

 

 

WASHINGTON – A New York corporation, whose principal place of business is Newnan, Ga., was sentenced to pay a $3.3 million criminal fine for conspiring to allocate customers in the food service equipment hardware market, including walk-in refrigeration equipment, the Department of Justice announced today.

 

Kason Industries Inc., a food service equipment manufacturer, pleaded guilty on May 19, 2010, in U.S. District Court in Atlanta. Kason Industries and its former president, Peter A. Katz, were charged on May 6, 2010, with one count of participating in a conspiracy from December 2004 until at least December 2008, to allocate customers for food service equipment hardware sold in the United States and elsewhere. The department said that the purpose of the conspiracy was to reduce and eliminate competition in the sale of the food service equipment hardware manufactured or sold by Kason Industries, Katz and their co-conspirators. Katz, who also pleaded guilty, is scheduled to be sentenced on Jan. 5, 2011.

 

Food service equipment hardware includes fabricated parts, such as cafeteria hardware, equipment legs and casters, and fabrication supplies, and walk-in refrigeration components, such as metal racks, door hinges, handles, latches, closers and panel fasteners.

 

According to court documents, Katz and co-conspirators agreed during meetings and telephone and e-mail discussions to allocate customers of food service equipment hardware; not to compete for one another’s protected customers or to submit intentionally high prices or bids to certain customers; to exchange prices to customers so as not to undercut one another’s prices; and to sell food service equipment hardware at collusive and noncompetitive prices.

 

Today’s sentencing is the result of an ongoing federal antitrust investigation of customer allocation in the food service equipment hardware industry. The investigation is being conducted by the Antitrust Division’s Atlanta Field Office and the FBI’s Atlanta Office.

 

Anyone with information concerning customer allocation or other anticompetitive conduct in the food service equipment hardware industry should contact the Antitrust Division’s Atlanta Field Office at 404-331-7100 or visit www.justice.gov/atr/contact/newcase.htm.

 

WASHINGTON – Ilkham Fazilov pleaded guilty today to racketeering conspiracy for his role in a criminal enterprise that engaged in numerous criminal activities including forced labor, fraud in foreign labor contracting, visa fraud, mail fraud, identity theft, tax evasion and money laundering, the Justice Department announced today.

According to court documents, Fazilov performed payroll functions and executed fraudulent petitions for foreign workers. Fazilov also opened bank accounts for the unlawful transfer of proceeds to facilitate criminal enterprise activities.

"The defendant was part of an organization that for pure greed exploited the hopes and dreams of numerous foreign workers to work legally in this country through foreign worker programs," said Assistant Attorney General for the Civil Rights Division Thomas E. Perez. "The Department of Justice will continue to vigorously prosecute these cases."

Multiple co-defendants have previously pleaded guilty in connection with the case. Co-defendant Alexandru Frumusache, 24, a citizen of the Republic of Moldova residing in Kansas City, Kan., pleaded guilty on Oct. 7, 2009, to forced labor trafficking, in connection with his role in aiding and abetting others in a scheme to hold foreign workers from the Phillipines, Dominican Republic and Jamaica, in overcrowded, substandard living conditions, and to compel the workers into continued service by causing the workers to believe that they would be deported, or that their work visas would be cancelled, or that they or their families would be penalized, if the workers failed or refused to work where and when they were ordered to work. Trial for the remaining defendants is set for Oct. 18, 2010.

The case was investigated by the Department of Homeland Security, the FBI, the Department of Labor, the Internal Revenue Service, the Kansas Department of Revenue and the Independence Police Department. U.S. Attorney Criminal Chief Gene Porter, Assistant U.S. Attorney William Meiners and Civil Rights Division Human Trafficking Prosecution Unit Trial Attorney Jim Felte prosecuted this case for the government.

WASHINGTON – Tracy Hope Davis has been appointed by Attorney General Eric Holder as U.S. Trustee for New York, Connecticut and Vermont (Region 2), effective today, the Executive Office for U.S. Trustees announced.

Ms. Davis has served as Acting U.S. Trustee in Region 2 since July 1, 2010. She joined the U.S. Trustee Program (USTP) in 1997 as a trial attorney and has served as the Assistant U.S. Trustee in New York City and the Acting Assistant U.S. Trustee in Brooklyn. Ms. Davis has significant experience in the oversight of complex corporate reorganizations, including the chapter 11 cases of Lehman Holdings Inc., Adelphia Communications et al., and Extended Stay et al. Before joining the USTP, she practiced law in New York City, specializing in bankruptcy. After law school, she served as law clerk to the Honorable Cornelius Blackshear, U.S. Bankruptcy Court, Southern District of New York (retired).

Ms. Davis received her law degree from Rutgers Law School in Newark, N.J., and her Bachelor of Arts degree from Wells College in Aurora, N.Y. She has served in various capacities as a Wells College alumna, including Vice President of the Wells College Board of Trustees and Advisor to the Wells College Alumnae Board Diversity Committee on Mentorship. Additionally, Ms. Davis is a frequent lecturer at training programs for USTP personnel and for entities such as St. John’s School of Law LLM Program, the American Bankruptcy Institute and the National Bar Association.

The USTP is the component of the Justice Department that protects the integrity of the bankruptcy system by overseeing case administration and litigating to enforce the bankruptcy laws. The USTP has 21 regions and 95 field offices. Region 2 is headquartered in New York City with additional offices in Albany, Brooklyn, Buffalo, Central Islip, Rochester and Utica, N.Y., and New Haven, Conn.

  Contact:

Jane Limprecht, Public Information Officer
Executive Office for U.S. Trustees
(202) 305-7411

WASHINGTON - The United States has sued a Chicago tax return preparer seeking to bar him and his company from preparing federal tax returns for others, the Justice Department announced today. The civil injunction suit alleges that Charlie Wilson and his Chicago business, CBD Tax Service, claim bogus deductions and credits on customers’ federal tax returns.

Wilson allegedly included fabricated claims for charitable deductions, employee business expenses and other deductions on tax returns that he and his business prepared since 2006. According to the government complaint, from 2006 to 2009, CBD Tax Service prepared approximately 6,527 federal income tax returns for customers with an unusually high refund rate of over 98 percent and, in 2009 alone, Wilson himself prepared at least 894 tax returns with a 98 percent refund rate.

In the past 10 years the Justice Department’s Tax Division has obtained injunctions against hundreds of tax-return preparers and tax-fraud promoters. Information about these cases is available on the Justice Department website.

WASHINGTON – Today’s passage by Congress of the Border Security Appropriations Bill provides $196 million for the Department of Justice to surge federal law enforcement efforts in high crime areas in the Southwest Border region, announced Acting Deputy Attorney General Gary G. Grindler.

 

“I commend Congress for passing the Border Security Appropriations Bill to add important resources to bolster security on our Southwest Border,” said Acting Deputy Attorney General Gary G. Grindler. “These assets are critical to bringing additional capabilities to crack down on transnational criminal organizations and reduce the illicit trafficking of people, drugs, currency and weapons.

 

“This bill will help strengthen the Department of Justice’s historic security efforts on the Southwest Border. Over the past 18 months, this Administration and this Department have dedicated unprecedented personnel, technology, and resources to the border, with unprecedented results, and we will continue to focus our efforts on disrupting criminal organizations and the networks they exploit,” said Acting Deputy Attorney General Grindler.

 

Acting Deputy Attorney General Grindler was joined in the announcement by Assistant Attorney General Lanny A. Breuer of the Criminal Division; Deputy Director Kenneth Melson of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF); U.S. Drug Enforcement Administration (DEA) Acting Administrator Michele M. Leonhart; Assistant Director Kevin Perkins of the FBI’s Criminal Investigative Division and U.S. Marshals Service Director John Clark.

 

Specifically, the funding will allow for more than 400 new positions and the temporary deployment of up to 220 personnel along the border as part of the Justice Department’s broader Southwest Border Strategy, including:

 

·         ATF Project Gunrunner Teams - Establishment of seven ATF Project Gunrunner teams comprised of special agents and industry operations investigators to target firearms trafficking along the Southwest Border;

·         Target Drug Enforcement Efforts at the Cartels - Enhancing and increasing intelligence operations against drug cartels as well as adding 50 new positions in Southwest Border offices;

 

·         FBI Hybrid Squads - Creation of five additional Hybrid Squads on the Southwest Border dedicated to combating the violent crime threat along the border and expanding intelligence collection efforts;

 

·         Organized Crime Drug Enforcement Task Force (OCDETF) - Increased funding for the Southwest Border region including its seven OCDETF Strike Forces in the area to support investigations and prosecutions of high level Mexican drug cartels;

 

·         U.S. Attorneys - Deployment of more than 30 prosecutors in targeted locations to provide additional prosecutorial resources dedicated to combating Southwest Border firearm and drug trafficking, and bulk cash smuggling;

 

·          Criminal Division - Creation of 26 positions to review wiretap requests, along with mutual legal assistance treaty (MLAT) and extradition requests as well as to provide additional support for the investigation and prosecution of transnational gangs, firearms and drug traffickers, and money launderers operating along the Southwest Border;  

 

·         USMS International Investigations - Deployment of more than 20 Deputy U.S. Marshals to support its international investigations, including establish offices in Mexico to address cross-border investigations and enhance USMS presence at El Paso Intelligence Center (EPIC) to facilitate more intelligence-driving investigations;

 

·         Immigration Litigation - Increased funding for Immigration Judge Teams to expedite the adjudication of removal proceedings involving criminal aliens;

 

·         Prisons and Detention Increased funding for contract beds and USMS personnel to accommodate prisoner levels; and

·         Training for Mexican law enforcement - Additional funding to support Mexican law enforcement operations with ballistic analysis, DNA analysis, information sharing, technical capabilities and assistance.

The Southwest Border Strategy, led by the Deputy Attorney General, uses federal prosecutor-led task forces that bring together all law enforcement components to identify, disrupt and dismantle the Mexican drug cartels through investigation, prosecution and extradition of their key leaders and facilitators, and seizure and forfeiture of their assets. The Department of Justice is increasing its focus on investigations and prosecutions of the southbound smuggling of guns and cash that fuel the violence and corruption and attacking the cartels in Mexico itself, in partnership with the Procuraduría General de la República (PGR) and the Secretariat of Public Security (SSP). 

 

The latest resources and funding announced by the United States build on the framework of expertise and experience that have been announced during the last year, as well as the successes these resources and funding have achieved, as part of the Obama administration’s support of the fight against the cartels.

 

As the largest law enforcement presence in Mexico with offices throughout, and a decades-long history of working with the Mexican government, the DEA has a strategic vantage point from which to assess the drug trafficking situation in Mexico, the related violence, its causes and its historical context. Currently, DEA has 29 percent of its domestic agent positions allocated to its Southwest border field divisions. Project Deliverance, announced in June 2010, led to the arrest of more than 2,200 individuals on narcotics-related charges in the United States and the seizure of more than 74.1 tons of illegal drugs as part of a 22-month multi-agency law enforcement investigation.

 

Through ATF’s Project Gunrunner, agents gather intelligence from federal firearms licensee records, ballistics and other laboratory analysis and trace data as well as use traditional methods of intelligence gathering to deny the “tools of the trade” to the firearms trafficking infrastructure of criminal organizations operating in Mexico and throughout the United States. As a result of Project Gunrunner, ATF seized 2,589 firearms and 265,500 rounds of ammunition destined for the Southwest Border in FY 2009.

 

ATF has significantly expanded its efforts by deploying GRIT teams to target areas along the border. As a result of the first GRIT team deployment to Houston, agents researched and completed more than 1,000 investigative leads resulting in the initiation of more than 275 firearms cases and seizure of more than 440 illegal firearms. GRIT teams also completed more than 1,100 federal firearms licensee (FFL) inspections.

Recovery Act funding provided Project Gunrunner with $10 million to hire special agents, industry operations investigators and others to staff new offices in McAllen, Texas; El Centro, Calif.; and Las Cruces, N.M. (including a satellite office in Roswell, N.M.,) to target the gun traffickers that enable weapons to make their way to violent criminals.

 

ATF has also expanded its successful eTrace initiative, which allows law enforcement agencies to identify firearms trafficking trends of drug trafficking organizations and other criminal organizations funneling guns into Mexico from the United States, as well as to develop investigative leads in order to stop firearms traffickers and straw purchasers (people who knowingly purchase guns for prohibited persons) before they cross the border.

 

In addition to the five new Hybrid Squads, the FBI is continuing to operate its National Border Corruption Task Force, with representatives from the FBI, Department of Homeland Security Office of Inspector General, U.S. Customs and Border Protection - Internal Affairs and TSA to guide and oversee border corruption programs across the country.

 

USMS has stepped-up its efforts along the Southwest border, deploying 94 additional Deputy U.S. Marshals and sending four additional deputies to Mexico City to assist the Marshals Service Mexico City Foreign Field Office in FY09. Twenty-five new Criminal Investigators-Asset Forfeiture Specialists have been placed in USMS asset forfeiture units in the field.  The new positions are unique in that they are solely dedicated to the USMS Asset Forfeiture Division and support U.S. Attorneys Offices and investigative agencies in investigations of cartels and other large-scale investigations.

 

Extraditions from Mexico reached an all-time high in 2009, with 107 individuals extradited from Mexico to the United States to stand trial for alleged crimes committed in the United States. The Criminal Division’s Office of International Affairs has already achieved the extradition of 54 fugitives from Mexico in 2010, 22 of whom have been for drug trafficking offenses. This included the extradition from Mexico of Mario Ernesto Villanueva Madrid, the former governor of the Mexican state of Quintana Roo.

In addition to increased resources and funding, the Department of Justice has continued to support Mexican law enforcement through training initiatives. The Criminal Division’s Office of Overseas Prosecutorial Development Assistance and Training (OPDAT) and others are providing real time hands-on training through seminars for investigators and prosecutors in Mexico on the investigation and prosecution of complex cases, as Mexico transitions to an adversarial system. The training of 5,462 Mexican prosecutors and investigators at the state and federal level and in the executive and judicial branches has already occurred, and the department is on target to reach 9,261 trained by the end of 2010.

 

In addition, the OCDETF program has increased its analyst personnel along the Southwest Border and the Office of Justice Programs invested $30 million in stimulus funding to assist with state and local law enforcement to combat narcotics activity coming through the southern border and in high intensity drug trafficking areas.

 

WASHINGTON– The Justice Department filed a consent decree today resolving claims of religious discrimination against the Lucky Joy restaurant, located in Flushing, N.Y. In the consent decree, the restaurant’s owner, Lucky Joy Restaurant Inc., and its president, Xiao Rong Wu, admit that the restaurant engaged in a pattern or practice of wrongfully ejecting Falun Gong practitioners from the premises.

 

The investigation, conducted jointly by the Housing and Civil Enforcement Section and the U.S. Attorney’s Office for the Eastern District of New York, revealed that Lucky Joy servers ejected ten patrons, including an eight-year-old girl, on three separate occasions during 2008 because members of their parties wore shirts displaying the tenets of the Falun Gong spiritual movement.

 

Under the consent decree, which must first be approved by the federal court, the defendants are enjoined from discriminating against any patron based on religion, religious expression, religious dress or association with Falun Gong. Additionally, the defendants have agreed that they and their staff will attend training regarding the non-discrimination requirements of Title II of the Civil Rights Act of 1964, will adopt non-discrimination policies and procedures which will be posted publicly (in English and Chinese), and will finance independent testing designed to ensure that Lucky Joy no longer discriminates.

 

“It’s disgraceful that a person would be refused service in a restaurant for doing nothing more than exercising their right to wear clothing with a religious message,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division.  “The Justice Department will continue to vigorously protect the rights of persons of all faiths to be free from discrimination in Flushing and across the country.”

 

Loretta E. Lynch, U.S. Attorney for the Eastern District of New York, stated that “People of all religious faiths have the right to be free from discrimination when they enter a restaurant to order a meal. This Office will work tirelessly to ensure that restaurant service is not denied to anyone in this district on the basis of their religion.”

 

The Justice Department’s investigation was conducted under Title II of the Civil Rights Act of 1964, which prohibits discrimination on the basis of race, color, national origin and religion in places of public accommodation, such as hotels, restaurants, and places of entertainment.

 

More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt/.  Persons who believe they have experienced or witnessed unlawful discrimination in public accommodations may contact the Housing and Civil Enforcement Section at (202) 514-4713 or, for cases arising in Brooklyn, Queens, Nassau, Suffolk and Staten Island in New York, the U.S. Attorney’s Office for the Eastern District of New York at 718-254-7000.

 

The former owner and chief executive officer of a financial products and services firm pleaded guilty today for his participation in fraud conspiracies related to contracts for the investment of municipal bond proceeds and other related municipal finance contracts, the Department of Justice announced.

According to the charges filed today in U.S. District Court in New York City, Martin Kanefsky, a resident of Great Neck, N.Y., pleaded guilty to participating in two separate fraud conspiracies with companies that provide a type of contract, known as an investment agreement, to public entities throughout the United States, such as state, county and local governments and agencies. These public entities were seeking to invest money from a variety of sources, primarily the proceeds of municipal bonds that they issued to raise money for, among other things, public projects. Kanefsky also pleaded guilty to one count of wire fraud. According to the plea agreement, Kanefsky has agreed to cooperate with the ongoing investigation.

The department said in court papers that Kanefsky’s former company, located in Great Neck, was hired by public entities that issue municipal bonds to act as their broker and conduct what was supposed to be a competitive bidding process for the award of investment agreements. Major financial institutions, including banks, investment banks, insurance companies and financial services companies, are among the providers of investment agreements and other related municipal finance contracts. Competitive bidding for these agreements is the subject of regulations issued by the U.S. Department of the Treasury and is related to the tax-exempt status of the bonds.

According to the court documents, Kanefsky engaged in one fraud conspiracy from as early as October 2001 until at least November 2006, and in a second fraud conspiracy from as early as August 1999 until at least November 2006. In each conspiracy, Kanefsky gave co-conspirator providers information about the prices, price levels or conditions in competitors’ bids, a practice known as a “last look,” which is explicitly prohibited by U.S. Treasury regulations. Kanefsky also solicited and received intentionally losing bids for certain investment agreements and other municipal finance contracts. As a result of the bid manipulation, the co-conspirator providers won contracts at artificially determined price levels, which deprived municipal issuers of money and property.

The court documents also charge that Kanefsky and co-conspirators misrepresented to municipal issuers or their bond counsel that the bidding process was in compliance with U.S. Treasury regulations. This caused the municipal issuers to award investment agreements and other municipal finance contracts to providers that otherwise would not have been awarded the contracts if the issuers had true and accurate information regarding the bidding process. Such conduct caused municipal issuers to file inaccurate reports with the Internal Revenue Service (IRS) and thus placed the tax-exempt status of the underlying bonds in jeopardy.

Each of the fraud conspiracies for which Kanefsky is charged carries a maximum penalty of five years in prison and a $250,000 fine. The wire fraud charge carries a maximum penalty of 20 years in prison and a $250,000 fine. The maximum fines for each of these offenses may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

This is the fifth guilty plea to arise from an ongoing investigation into the municipal bonds industry, which is being conducted by the Antitrust Division’s New York Field Office, the FBI and IRS Criminal Investigation. The department is coordinating its investigation with the Securities and Exchange Commission, the Office of the Comptroller of the Currency and the Federal Reserve Bank of New York.

Three former employees of Rubin/Chambers, Dunhill Insurance Services Inc., also known as CDR Financial Products (CDR), a Beverly Hills, Calif.-based financial products and services firm that acted as a broker of investment agreements and other municipal finance agreements, have pleaded guilty to bid-rigging and fraud conspiracies in relation to the ongoing investigation. A former employee of another financial services company also pleaded guilty to bid-rigging and fraud charges in relation to the ongoing investigation.

As a result of the ongoing investigation, three former financial services executives were indicted on July 27, 2010, for participating in fraud schemes and conspiracies related to the bidding for investment agreements. In addition, CDR, two of its employees and one former employee were charged in October 2009 for participating in bid-rigging and fraud conspiracies and related crimes. The CDR trial is scheduled to begin on Sept. 12, 2011.

Today’s guilty plea is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information on the task force, visit www.StopFraud.gov.

Anyone with information concerning bid rigging and related offenses in any financial markets should contact the Antitrust Division’s New York Field Office at 212-264-0390 or visit www.justice.gov/atr/contact/newcase.htm, or the FBI at 212-384-5000.

WASHINGTON – A federal grand jury in Phoenix, Ariz., returned a three-count indictment today charging former Navajo Police Officer Christine Thinn and former Navajo Police Sergeant Phillip Bedonie Jr. with federal crimes in connection with the beating of Newton Charlie in January 2009.

 

Today’s indictment was announced by Thomas E. Perez, Assistant Attorney General for the Civil Rights Division; Dennis K. Burke, U.S. Attorney for the District of Arizona; and Nathan Thomas Gray, Special Agent in Charge of the FBI Phoenix Field Office.

 

Thinn is charged with violating Charlie’s constitutional rights by beating him on Jan. 1, 2009. The indictment alleges that Thinn kicked, stomped, struck and deployed Oleoresin Capsicum spray, commonly known as pepper spray, into Charlie’s face, resulting in bodily injury. In addition, the indictment charges Thinn with assaulting Charlie with a dangerous weapon.

 

The indictment also charges former Bedonie with violating Charlie’s constitutional rights by willfully permitting and failing to prevent Thinn from striking, kicking, beating and otherwise unlawfully assaulting Charlie while he was in their custody. Thinn faces a possible maximum sentence of 20 years in prison. Bedonie faces a possible maximum sentence of 10 years in prison.

 

“Law enforcement officers who abuse their power and violate the public trust by denying individuals of their constitutional rights will be prosecuted to the fullest extent of the law,” Assistant Attorney General Perez said.

 

“Police officers have a sworn duty to uphold the Constitution when they wear the uniform.  They are held to a higher standard that includes respecting the rights of those in their custody and protecting them from harm,” said U.S. Attorney Burke.

 

“Whenever a law enforcement officer violates an individual’s civil rights it erodes the public’s trust in those who are sworn to uphold the laws of our country,” said Special Agent in Charge Gray.  “Today’s indictment illustrates the commitment by the FBI and the United States Attorney’s Office to hold accountable law enforcement officials who violate this trust.”

 

This case, which is ongoing, is being investigated by the FBI’s Phoenix Field Office and is being prosecuted by Trial Attorney D.W. Tunnage of the Justice Department’s Civil Rights Division, along with Assistant U.S. Attorney Alison S. Bachus for the District of Arizona.

An indictment is merely an accusation, and the defendants are presumed innocent unless proven guilty.

HONOLULU – A comprehensive settlement has been reached with the City and County of Honolulu that will address Clean Water Act compliance at Honolulu’s wastewater collection and treatment systems, the Justice Department, U.S. Environmental Protection Agency (EPA), Hawaii Attorney General’s Office, Hawaii Department of Health, and three environmental groups announced today.

The settlement which also resolves lawsuits brought by the Sierra Club, Hawaii’s Thousand Friends and Our Children’s Earth Foundation, includes a comprehensive compliance schedule for the city to upgrade its wastewater collection system by June 2020. Under the settlement, the Honouliuli wastewater treatment plant will need to be upgraded to secondary treatment by 2024. The Sand Island plant will need to be upgraded by 2035, but could be extended to 2038 based on a showing of economic hardship.

Work on the wastewater collection system will include rehabilitation and replacement of both gravity and force main sewer pipes, backup strategies to minimize the risks of force main spills, a cleaning and maintenance program, improvements to Honolulu’s program to control fats, oils and grease from entering into the wastewater system from food establishments, and repair to pump stations.

“Today’s settlement represents a significant commitment that will address the city and county of Honolulu’s aging wastewater collection and treatment systems,” said Ignacia S. Moreno, Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. “The end result will not just be an improvement to the system’s infrastructure. It will also significantly reduce both the public health risk caused by exposure to pathogens in raw sewage and the amount of harmful pollutants entering Honolulu’s vibrant marine environment.”

“This settlement will lead to significant improvements in water quality for the people of Oahu. It calls for aggressive actions in the near term to upgrade the city’s sewage collection system, and set outs a longer term schedule for construction of secondary treatment at the Sand Island and Honouliuli plants,” said Jared Blumenfeld, EPA’s Administrator for the Pacific Southwest region. “The work required by the settlement will be phased to allow the city to better manage the costs of this critical program.”

“This settlement has many positive features, and among the biggest are the collection system improvements to prevent future major raw sewage discharges, as happened at the Ala Wai Canal in 2006,” said Laurence Lau, the State Department of Health’s Deputy Director for Environmental Health.

In addition, the city will be paying a total fine of $1.6 million to be split between the federal government and the state of Hawaii to resolve violations of the federal Clean Water Act and the state of Hawaii’s water pollution law, such as the March 24, 2006 Beachwalk force main break that spilled approximately 50 million gallons of sewage into the Ala Wai Canal.

The settlement, lodged in U.S. District Court for the District of Hawaii, is subject to a 30-day public comment period and final court approval. A copy of the settlement document will be available on the Department of Justice website at: www.usdoj.gov/enrd/Consent_Decrees.html

WASHINGTON - A former contract employee of the U.S. Defense Department (DoD) pleaded guilty today to conspiracy to bribe U.S. Army contracting officials stationed at Camp Arifjan, an Army base in Kuwait, and to money laundering conspiracy, announced Assistant Attorney General Lanny A. Breuer for the Criminal Division.

According to the court documents filed today in U.S. District Court for the Southern District of Indiana, Wajdi Birjas, 39, of Evansville, Ind., was a contract employee in the Host Nation Affairs office at Camp Arifjan between approximately 2004 and August 2007. In this position, his responsibilities included identifying Kuwaiti companies able to provide certain goods and services to the U.S. military in Kuwait. Through his work, Birjas had frequent contact with Army contracting officials, including officials who were regularly receiving unlawful payments from individuals who had contracts with, or were seeking contracts from, DoD.

According to court documents, Birjas, acting at the direction of a contractor working in Kuwait, developed corrupt relationships with certain Army contracting officials, including Christopher Murray, James Momon and a sergeant first class deployed to Camp Arifjan as a senior procurement non-commissioned officer (NCO.) By bribing these Army contracting officials in 2005 and 2006, the contractor ultimately received a total of more than $1.7 million in connection with contracts to provide various goods and services to the U.S. military. In exchange for his assistance in the bribery scheme, Birjas received a share of the profits that the contracts generated and was allowed to live rent-free in a villa that contained a hidden safe.

Court documents indicate that Birjas paid Murray approximately $10,000; paid the senior procurement NCO approximately $14,000; and paid the airplane and hotel expenses of a co-conspirator and Momon to celebrate New Year’s eve in Dubai, United Arab Emirates. According to the court documents, Birjas also allowed Momon to hide hundreds of thousands of dollars worth of his bribe money in Birjas’s safe.

Birjas admitted that he agreed to arrange for $250,000 of Momon’s bribe money to be transferred from Kuwait to the United States, after Momon had returned to the United States at the end of his tour. Birjas admitted to working out this agreement with the third Army officer and one of his associates, a former master sergeant in the Army who operated a concession to sell clothing at U.S. military bases in Kuwait. According to court documents, Birjas delivered approximately $85,000 worth of Momon’s bribe money to the former master sergeant for ultimate delivery to Momon.

"It is reprehensible that while the men and women of our armed forces are putting their lives on the line, there are others who are attempting to defraud our government using contracts intended to help provide vital goods and services," said Assistant Attorney General Lanny A. Breuer.  "Those who defraud the government – whether they are corrupt officials who accept bribes or fraudsters attempting to game the system - will be prosecuted." 

"Cleaning up contract fraud in Southwest Asia, to include bribery and gratuities, is the highest priority for DCIS. While we applaud this result today, it also sets forth a good example of conduct that cannot - and will not - be tolerated," said James Burch, Deputy Inspector General for Investigations, Defense Criminal Investigative Service (DCIS).

"This case highlights the compelling need for comprehensive oversight of contractors and subcontractors working in war zones," said Stuart W. Bowen, Jr., the Special Inspector General for Iraq Reconstruction. "SIGIR remains committed to holding accountable those who chose to engage in criminal activity involving U.S. funds allocated for Iraq’s reconstruction."

The charge of bribery conspiracy carries a maximum prison sentence of five years and a $250,000 fine. The money laundering conspiracy charge carries a maximum prison sentence of 20 years and a $250,000 fine. Under the plea agreement, Birjas agreed to forfeit $675,000 to the government. Sentencing has been scheduled for Jan. 7, 2011.

The case against Birjas arose out of an investigation into corruption at the Kuwait contracting office at Camp Arifjan, which has led to charges against 14 individuals. Of those 14 defendants, 12 have pleaded guilty to their crimes, with some are already serving prison sentences. For example, on Dec. 2, 2009, former U.S. Army Major John Cockerham was sentenced to 210 months in prison and ordered to pay $9.6 million in restitution. On Dec. 17, 2009, Murray was sentenced to 57 months in prison and ordered to pay $245,000 in restitution. On Aug. 13, 2008, Momon pleaded guilty to receiving approximately $1.6 million in bribes and agreed to pay $5.7 million in restitution.  On Feb. 18, 2010, Army contractor Terry Hall pleaded guilty to bribery conspiracy and money laundering conspiracy and agreed to forfeit $15.7 million to the U.S. government in connection with his payment of more than $3 million in bribes to Cockerham, Momon, Murray and former Army Major Eddie Pressley. The case against Hall’s co-defendants, Eddie Pressley and Eurica Pressley, is scheduled for trial on Nov. 29, 2010, in Decatur, Ala.

The case is being prosecuted by Trial Attorneys Peter C. Sprung and Edward J. Loya Jr. of the Criminal Division's Public Integrity Section. The case is being investigated by special agents of the DCIS, the Army Criminal Investigation Command Division, the FBI and the Special Inspector General for Iraq Reconstruction.

Today’s plea represents the Department of Justice's commitment to protect U.S. taxpayers from procurement fraud through its creation of the National Procurement Fraud Task Force. The National Procurement Fraud Initiative announced in October 2006, is designed to promote early detection, identification, prevention and prosecution of procurement fraud associated with the increase in contracting activity for national security and other government programs. The investigation is continuing.

WASHINGTON – An operator of a Detroit-area medical clinic was sentenced Tuesday to 56 months in prison for his role in a conspiracy to defraud the Medicare program, the Departments of Justice and Health and Human Services announced today. Carlos Grana, a Miami resident, was also sentenced by U.S. District Judge Lawrence P. Zatkoff in the Eastern District of Michigan to three years of supervised release following his prison term and was ordered to pay $2 million in restitution.

Grana, 36, pleaded guilty in April 2010 to one count of conspiracy to commit health care fraud. According to the plea documents, Grana managed the day-to-day operations of Careplus LLC, a medical clinic in Livonia, Mich. Grana admitted that while he managed Careplus, he paid patient recruiters for Medicare beneficiary referrals. According to court documents, the recruiters were expected to find and transport Medicare beneficiaries to Careplus. Grana admitted he paid the recruiters between $100 and $150 per patient referral, and instructed the recruiters to pay the patients $50 from that amount. According to court documents, nearly all of the patients treated at Careplus were secured through the payment of kickbacks.

Grana further admitted that in exchange for the payments, he and his co-conspirators expected the Medicare beneficiaries who received kickbacks to subject themselves to medical examinations and to medically unnecessary diagnostic tests. Grana told the recruiters to instruct the patients to feign certain symptoms when they arrived at Careplus, which led to the patients’ medical records containing information about false symptoms. The falsified records then helped Careplus deceive Medicare about the legitimacy and medical necessity of the tests it performed. Between approximately February 2008 and October 2009, Grana and his co-conspirators at Careplus submitted approximately $2.2 million in claims to the Medicare program for unnecessary medical and testing services that were procured through the payment of kickbacks. Medicare paid approximately $2 million of those claims.

This sentence was announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade; Special Agent in Charge Andrew G. Arena of the FBI’s Detroit Field Office; and Special Agent in Charge Lamont Pugh III of the HHS Office of Inspector General’s (OIG) Chicago Regional Office.

This case was prosecuted by Assistant Chief John K. Neal, Trial Attorney Gejaa T. Gobena and Special Trial Attorney Stephanie M. Hays of the Criminal Division’s Fraud Section. The FBI and the HHS Office of Inspector General (HHS-OIG) conducted the investigation. The case was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan.

Since its inception in March 2007, Medicare Fraud Strike Force operations in seven districts have obtained indictments of more than 810 individuals and organizations that collectively have billed the Medicare program for more than $1.85 billion.  In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

To learn more about the HEAT team, go to: www.stopmedicarefraud.gov.

WASHINGTON – David Ralph Garcia Jr., 38, of Mesa, Ariz., was sentenced on Tuesday to 10 years in prison for possessing images of child pornography, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division and U.S. Attorney Dennis K. Burke for the District of Arizona. 

Garcia pleaded guilty on Aug. 22, 2008, to one count of possession of child pornography. Garcia initially came to the attention of law enforcement after agents discovered his Internet protocol address offered child pornography for online download. As part of his guilty plea, Garcia admitted that he possessed six images of child pornography on a compact disc. According to public proceedings and filings in Maricopa County Superior Court, after Garcia pleaded guilty to the federal child pornography offense, Garcia was convicted under Arizona law of five counts of sexual conduct with a minor and one count of molestation of a child.

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

The case was prosecuted by Trial Attorney James Silver of CEOS, with assistance from Assistant U.S. Attorneys Sharon Sexton and Vincent Kirby of the District of Arizona.  The Department of Homeland Security’s Immigration and Customs Enforcement (ICE) and the High Tech Investigative Unit of CEOS investigated the case.

WASHINGTON – An international credit card trafficker thought to be one of the most prolific sellers of stolen data was arrested in Nice, France, on Aug. 7, 2010, on charges in an indictment unsealed today in U.S. District Court in the District of Columbia, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division, U.S. Attorney Ronald C. Machen Jr. for the District of Columbia and U.S. Secret Service Assistant Director for Investigations Michael Merritt.

Vladislav Anatolievich Horohorin, 27, aka "BadB" of Moscow, Russia, was indicted by a federal grand jury in November 2009 on charges of access device fraud and aggravated identity theft. The indictment was unsealed today, following Horohorin’s arrest by French authorities during the weekend.

"In just the last week, we’ve seen an alleged hacker extradited to the United States to face charges, and now, a credit card data dealer arrested abroad on U.S. charges," said Assistant Attorney General Lanny A. Breuer of the Criminal Division.  "Cyber criminals who target U.S citizens should not fool themselves into believing they can elude justice simply because they commit crimes outside of our borders.  As this and so many other cases demonstrate, working hand in hand with our partners around the globe, we will do everything in our power to bring these criminals to the United States to answer for their alleged crimes."

"Computer hackers and identity thieves threaten the security of millions of innocent Americans with their crimes.  These criminals are mistaken to think that they can escape detection by committing their crimes behind a computer screen in a foreign country," said U.S. Attorney Machen. "The arrest and prosecution of Mr. Horohorin demonstrates that we will identify, apprehend, and bring to justice in the United States even the most sophisticated international computer hackers."

"The network created by the founders of CarderPlanet, including Vladislav Horohorin, remains one of the most sophisticated organizations of online financial criminals in the world," said U.S. Secret Service Assistant Director for Investigations Michael Merritt. "This network has been repeatedly linked to nearly every major intrusion of financial information reported to the international law enforcement community. This arrest is an illustration of the success that comes from international law enforcement and private sector partnerships and confirms the Secret Service commitment to traversing the globe in pursuit of online criminals."

According to the indictment, Horohorin was the subject of an undercover investigation by U.S. Secret Service agents. Horohorin, who is a citizen of Israel and the Ukraine, allegedly used online criminal forums such as "CarderPlanet" and "carder.su" to sell stolen credit card information, known as "dumps," to online purchasers around the world. According to the indictment, Horohorin, using the online name "BadB," advertised the availability of stolen credit card information through these web forums, and directed purchasers to create accounts at "dumps.name," a fully-automated dumps vending website operated by Horohorin and hosted outside the United States. The website was designed to assist in the exchange of funds for the stolen credit card information. Horohorin allegedly directed buyers to fund their "dumps.name" account using funds transferred by services including "Webmoney," an online currency service hosted in Russia. The purchaser would then access the "dumps.name" website and select the desired stolen credit card data. Using an online undercover identity, U.S. Secret Service agents negotiated the sale of numerous stolen credit card dumps.

French law enforcement authorities, working with the U.S. Secret Service, identified Horohorin in Nice, France, as he was attempting to board a flight to return to Moscow. Horohorin was arrested by French authorities on a provisional arrest warrant based upon the U.S. charges. He is currently being detained in France pending extradition to the United States.

Horohorin faces a maximum penalty of 10 years in prison and a $250,000 fine on the count of access device fraud. Horohorin is also charged with one count of aggravated identify theft, which carries a statutory consecutive penalty of two years in prison and a fine of up to $250,000.

The charges in an indictment are merely allegations and a defendant is presumed innocent until proven guilty.

The case is being prosecuted by Trial Attorney Joseph Springsteen of the Criminal Division’s Computer Crime and Intellectual Property Section. He also serves as a Special Assistant U.S. Attorney for the District of Columbia. Assistant U.S. Attorney Glenn Leon also provided assistance in this case. Department of Justice Attaché Monique Roth of the Criminal Division’s Office of International Affairs provided assistance in this matter.

This case is being investigated by the U.S. Secret Service. Key assistance was provided by the French Police Nationale Aux Frontiers and the Netherlands Police Agency National Crime Squad High Tech Crime Unit. The FBI’s Atlanta Field Office also provided information, which assisted in this investigation.

WASHINGTON—The Justice Department today filed a lawsuit against the owners, developers, architects and civil engineers of Park Place Apartments, a 276-unit complex in Louisville, Ky., for failing to provide accessible features required by the Fair Housing Act.

The lawsuit, filed in federal court in Louisville, alleges that Kevin D. Cogan, Edwynn Burckle, George E. Clark, Doris Cogan, Bayus-Evola Architects, James A. Hall, Hall Construction Company, Mindel Scott & Associates Inc. and Willett Engineering Company discriminated against persons with disabilities when they designed and constructed Park Place with, among other things, interior doors that are too narrow for persons who use wheelchairs; kitchens and bathrooms that limit or prevent individuals who use wheelchairs from maneuvering about them; thermostat controls that are mounted above the maximum reach height of persons who use wheelchairs; and routes from the public access parking areas to apartment units and to site amenities that are not accessible to persons who use wheelchairs.

"Since 1991, federal law has required that new multi-family housing complexes with four or more units be built with certain accessible features.  There is no excuse for developers and design professionals to fail to comply," said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division.  "Inaccessible multi-family housing developments deny persons with disabilities their legal right to equal housing opportunities."

This lawsuit arose from a complaint filed with the U.S. Department of Housing and Urban Development (HUD). HUD conducted an investigation and referred the matter to the Justice Department. The suit seeks a court order requiring the defendants to make appropriate accessibility retrofits at the complex, to pay monetary damages to individuals who have been harmed by their conduct and to refrain from future discrimination.

The federal Fair Housing Act prohibits discrimination in housing on the basis of race, color, religion, sex familial status, national origin and disability. More information about the Civil Rights Division and the laws it enforces is available at www.usdoj.gov/crt. Individuals who believe that they have been victims of housing discrimination at Park Place or have information related to this lawsuit can call the Housing Discrimination Tip Line at 1-800-896-7743, ext. 9996, or e-mail the Justice Department at [email protected].

WASHINGTON — Plains All American Pipeline L.P. and several of its operating subsidiaries will spend approximately $41 million over the next three years to prevent and remediate corrosion, improve leak detection practices and capabilities, and enhance pipeline oversight on 10,420 miles of crude oil pipeline operated in the United States, the Justice Department and Environmental Protection Agency (EPA) announced today. The settlement resolves Houston-based Plains’ Clean Water Act violations arising out of 10 crude oil spills in Texas, Louisiana, Oklahoma and Kansas and also requires the pipeline company to pay a $3.25 million civil penalty.

Between June 2004 and September 2007, approximately 6,510 barrels of crude oil were discharged from various pipelines and one tank owned and operated by Plains into navigable waters or adjoining shorelines. The 10 spills ranged in size from 2.5 barrels to 4,500 barrels and most were caused by pipeline corrosion. Oil spills are known to cause both immediate and long-term harm to human health and ecosystems, including the suffocation of wildlife and the contamination of nesting habitats.

The Clean Water Act makes it unlawful to discharge oil or hazardous substances into or upon waters of the United States or adjoining shorelines in quantities that may be harmful to the environment or public health. The penalty paid for this spill will be deposited in the federal Oil Spill Liability Trust Fund and will be used to pay for federal response activities and to compensate for damages when there is a discharge or substantial threat of discharge of oil or hazardous substances to waters of the United States or adjoining shorelines.

“The Justice Department is committed to strong enforcement of our nation's laws in order to protect human health and the environment,” said Ignacia S. Moreno, Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. “This settlement will result in the enhancement of safety measures that will significantly reduce the risk of future pipeline leaks and harm to the environment.”

"In the last year alone, transportation pipelines released more than two million gallons of oil into the environment, posing a serious threat to human health and natural habitats," said Cynthia Giles, assistant administrator for EPA’s Office of Enforcement and Compliance Assurance.

"These spills - and the recent pipeline spill in the Kalamazoo River - remind us that we must be diligent in our enforcement efforts and work to ensure that companies are meeting their environmental obligations."

As part of the agreement, Plains must take steps to enhance corrosion control, enhance pipeline leak detection and provide proper training for personnel. In addition, Plains must ensure that all breakout tanks used to replace or substitute existing tanks that relieve pipeline surges have adequate capacity to contain such surges and are properly located within secondary containment.

According to recent pipeline spill reports, in the last year, more than 50,000 barrels (2.1 million gallons) of oil spilled from transportation pipelines across the nation. EPA’s enforcement responses to spills that affect waters of the United States under the Clean Water Act are critical to ensure that responsible companies are penalized for these spills and required to take appropriate actions to reduce the potential for future spills.

The consent decree, filed in the U.S. District Court for the Southern District of Texas, is subject to a 30-day public comment period and approval by the federal court. A copy of the consent decree is available on the Justice Department website at: www.justice.gov/enrd/Consent_Decrees.html .