District Not Recorded
The source did not name an office we could identify. These records remain unassigned rather than guessed.
U.S. Sues First Choice Armor & Equipment for Providing<br /> Defective Bullet-Proof Vests to Law Enforcement AgenciesRead the Press Release
The United States has filed a False Claims Act lawsuit against First Choice Armor & Equipment Inc. and its founder, Edward Dovner, for submitting false claims for bullet-proof vests purchased by the United States for federal, state, local and tribal law enforcement agencies, the Justice Department announced today.
First Choice, which manufactured and sold bullet-proof vests containing Zylon fiber from 2000- 2005, marketed its vests to law enforcement agencies as a thinner and more lightweight alternative to other bullet-proof vests. The United States alleges that at the same time First Choice was selling its Zylon bullet-proof vests, the company and its founder knew of significant manufacturing and degradation problems in the Zylon fiber that rendered the material unsafe for ballistic use. In fact, when the Justice Department’s National Institute of Justice tested eight of First Choice’s bullet-proof vests in 2005, all failed.
The United States has also sued Mr. Dovner and Karen Herman, Mr. Dovner’s wife and First Choice’s president, for a fraudulent conveyance – a transfer of property that is made to swindle, hinder or delay a creditor, or to put such property beyond his or her reach – in violation of the Federal Debt Collection Procedures Act. The government alleges that after learning of the investigation into Zylon bullet-proof vests, Mr. Dovner and Ms. Herman removed more than $5 million from First Choice. Mr. Dovner then purchased a Ferrari, a Maserati and a private jet through various shell companies.
"By providing defective bullet-proof vests to the nation’s law enforcement officers, First Choice put the lives of those officers at risk," stated Tony West, Assistant Attorney General for the Civil Division of the Department of Justice. "The government’s investigation has determined that bullet-proof vest manufacturers, such as First Choice, wasted taxpayer dollars by failing to address these problems even after they were warned about them."
The United States is already pursuing lawsuits against Toyobo Co., the manufacturer of the Zylon fiber used in the First Choice bullet-proof vests, as well as Second Chance Body Armor and Honeywell International Inc., two other companies that manufactured Zylon vests or components for those vests. The government has previously settled for more than $47 million with five other entities that allegedly were involved in the manufacture or sale of defective Zylon vests.
Assistant Attorney General West acknowledged the cooperation between the many government agencies participating in this ongoing investigation, including the Justice Department’s Civil Division, the U.S. Attorney’s Office for the District of Columbia, the General Services Administration Office of the Inspector General, the Department of Homeland Security Office of Inspector General, the Treasury Inspector General for Tax Administration, the Defense Criminal Investigative Service, the U.S. Army Criminal Investigative Division, the Air Force Office of Special Investigations, the Department of Energy Office of the Inspector General, the U.S. Agency for International Development Office of the Inspector General, the Federal Bureau of Investigation and the Defense Contracting Audit Agency.
Justice Department Signs Agreement with Wendell, Idaho, <br /> to Ensure Civic Access for People with DisabilitiesRead the Press Release
WASHINGTON – The Justice Department today announced an agreement with the city of Wendell, Idaho, to improve access to all aspects of civic life for persons with disabilities. The agreement was reached under the Department’s Project Civic Access initiative, which aims to bring state and local governments into compliance with the Americans with Disabilities Act (ADA). This agreement is the 165th under Project Civic Access.
As part of Project Civil Access, Justice Department investigators, attorneys and architects conduct on-site surveys of state and local government programs and facilities across the country for the purpose of identifying modifications needed for compliance with ADA requirements. The agreements contain a plan setting out the specific steps a community will take to improve access for persons with disabilities.
"Although Wendell is one of our nation’s smaller cities, more than 20 percent of Wendell residents have some type of disability. We are pleased that officials in the city of Wendell recognize the importance of civic access for those individuals," said Acting Assistant Attorney General Loretta King of the Civil Rights Division. "As a result of the city’s efforts, all of its residents will have equal access to city programs and services."
Wendell is a town of just over 2,300 residents located about 100 miles southeast of Boise, Idaho, and one out of every five residents has a disability. The Department’s agreement with the city specifies that Wendell will:
- Make physical modifications to its facilities so that parking, routes into the buildings, entrances, public telephones, restrooms, service counters and drinking fountains are accessible to people with disabilities;
- Post, publish and distribute a notice to inform the public of the provisions of Title II of the ADA and their applicability to the City’s programs, services and activities;
- Ensure that all appropriate employees are trained and practiced in using the Idaho Relay Service to make and receive calls;
- Develop a method for providing information for interested persons with disabilities concerning the existence and location of the city’s accessible services, activities and programs; and
- Install signs at any inaccessible entrance to a facility directing users to an accessible entrance or to information about other accessible facilities.
The ADA requires state and local government programs, activities, and services to be accessible to persons with disabilities. It applies to all communities throughout the United States, from the largest cities and counties to the smallest towns and villages.
People interested in finding out more about the ADA, today’s agreement with the city of Wendell or the Department’s Project Civic Access initiative can obtain information on the ADA Web site at http://www.ada.gov or may call the toll-free ADA Information Line at (800) 514-0301 or (800) 514-0383 (TTY).
Five Companies Agree to $21 Million Settlement for Environmental Damages in PennsylvaniaRead the Press Release
WASHINGTON—Five companies have agreed to compensate the United States and the Commonwealth of Pennsylvania nearly $21.4 million in cash and valuable property to address natural resource damages resulting from decades of zinc smelting operations at the Palmerton Zinc Pile Superfund site in northeast Pennsylvania, the Justice Department and the Commonwealth of Pennsylvania announced today. The settlement is the largest natural resource damage settlement to date in Pennsylvania.
CBS Operations Inc., TCI Pacific Communications Inc., CBS/Westinghouse of Pa. Inc., HH Liquidating Corp. and HRD Liquidating Corp., agreed to make a cash payment of $9.875 million and to transfer 1200 acres of valuable property, known as the Kings Manor property and valued at approximately $8.72 million, to the Pennsylvania Game Commission. The companies’ cash payment will be deposited into the U.S. Department of the Interior’s Natural Resource Damage Assessment and Restoration Trust Fund to be used to restore, replace, or acquire the equivalent of natural resources injured as a result of releases of hazardous substances at the Palmerton Zinc site.
In addition, the companies agreed to pay $2.5 million for damage assessment costs and to discharge a mortgage worth $300,000 on the Wildlife Information Center (Lehigh Gap Nature Center), a non-profit conservation and environmental education organization, located at the Lehigh Gap.
"The funds and property recovered from this settlement will result in a cleaner, restored environment to counteract the damages that were incurred as a result of the years of harmful emissions from smelter operations," said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. "This settlement is a result of a cooperative effort by federal and state trustees."
The settlement will resolve claims under the Comprehensive Environmental Response and Compensation Act, also known as the Superfund law, the Clean Water Act and the Pennsylvania Hazardous Sites Cleanup Act, under which federal and state trustees of natural resources are authorized to seek compensation for damages to resources that are injured by releases of hazardous substances.
The Palmerton Zinc Pile Superfund Site consists of a broad area impacted by emissions of contaminants from historic zinc smelting operations and more recent zinc-recovery operations at a plant site located twenty-five miles north of Allentown, Pa., in Palmerton, Pa. Over ninety years of smelting operations by the former New Jersey Zinc Co., emitted hazardous materials including arsenic, cadmium, chromium, copper, lead, manganese and zinc into the surrounding environment through air emissions and the release of solid wastes.
Large quantities of the hazardous materials were carried by wind and deposited over surrounding areas resulting in defoliation and contamination of thousands of acres throughout the ridge and valley area of eastern Pennsylvania. The National Park Service owns and maintains approximately 800 acres of land that has been acquired to protect the Appalachian National Scenic Trail in this area, which winds along the Blue Mountain ridge and through the associated gaps. The Pennsylvania Game Commission also owns several thousand acres of State Game Lands on Blue Mountain. Hazardous materials subsequently contaminated several miles of Aquashicola Creek and the Lehigh River as a result of erosion, surface runoff, and shallow ground water contamination.
CBS/Westinghouse of Pa. Inc., is a current owner of a portion of the Site. CBS Operations Inc., TCI Pacific Communications Inc., HH Liquidating Corp. and HRD Liquidating Corp., are successors of the zinc smelting and zinc recovery operators.
The trustees in this case include: the U.S. Department of the Interior, Fish and Wildlife Service and National Park Service, the U.S. Department of Commerce, National Oceanic and Atmospheric Administration, the Pennsylvania Department of Environmental Protection, the Pennsylvania Game Commission, the Pennsylvania Fish and Boat Commission and the Pennsylvania Department of Conservation and Natural Resources.
The consent decree, lodged in the U.S. District Court for the Middle District of Pennsylvania, is subject to a 60-day comment period and final court approval. The consent decree is available on the Justice Department Web site at www.usdoj.gov/enrd/Consent_Decrees.html.
Attorney General Holder Appoints New Member<br /> to the Board of Immigration AppealsRead the Press Release
WASHINGTON – Attorney General Eric H. Holder, Jr., announced today the appointment John H. Guendelsberger as a new member of the Board of Immigration Appeals (BIA). The BIA is part of the Justice Department’s Executive Office for Immigration Review located in Falls Church, Va., and is responsible for hearing appeals of decisions rendered by immigration judges or certain Department of Homeland Security officers. It is the highest administrative body for interpreting and applying Federal immigration laws.
Mr. Guendelsberger has served as senior counsel to BIA’s board chairman since October 2003. During this time, from May 2007 to July 2009, he has served as a temporary board member. He previously served as a board member from September 1995 to October 2003.
Mr. Guendelsberger worked for three years as a staff attorney with Ohio Legal Rights Service, a state agency advocating the rights of persons with mental or developmental disabilities. From 1980 to 1995, he was a professor of law at Ohio Northern University College of Law where he specialized in immigration law, comparative law and international law. Mr. Guendelsberger has written numerous articles in the area of immigration law and has represented aliens on a pro bono basis before Immigration Judges and the Board.
He received his juris doctorate from Ohio State University College of Law in 1977. Mr. Guendelsberger also earned a number of advanced degrees in law including a master of laws degree and a doctor of science of law degree from Columbia University School of Law and a diploma of advanced studies from the University of Paris (Pantheon-Sorbonne). He is a member of the Ohio Bar.
Two Chemical Companies Agree to Resolve Environmental Violations in OhioRead the Press Release
WASHINGTON—The former and current owners and operators of a chemical facility in Addyston, Ohio, LANXESS Corp. and INEOS ABS USA Corp., have agreed to pay a $3.1 million civil penalty and INEOS will spend up to $2 million to install environmental controls and modify operating procedures to resolve violations of multiple environmental laws, the Justice Department and U.S. Environmental Protection Agency (EPA) announced today.
The settlement resolves a complaint filed by the United States and the state of Ohio alleging violations of the Clean Air Act, the Comprehensive Environmental Response, Compensation and Liability Act and the Emergency Planning and Community Right-to-Know Act.
"We are pleased that this settlement requires INEOS to go beyond compliance and take immediate steps to reduce emissions of hazardous air pollutants. The reductions will produce real health benefits for the people of Ohio," said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division.
"This settlement is an excellent example of state, local and federal agencies working together to improve the environment in the Addyston, Ohio area," said Bharat Mathur, the EPA Region 5 Acting Regional Administrator.
Under the agreement filed in U.S. District Court in the Southern District of Ohio, INEOS, the current owner and operator of the Addyston Facility, has agreed to upgrade environmental controls and make multiple modifications of its operating procedures including:
- Operating its flare in accordance with specific new parameters to ensure control of volatile organic compounds (VOCs), which include hazardous air pollutants, in accordance with its flare control efficiency permit requirements;
- Installing a new biofilter system in the wastewater treatment system to reduce acrylonitrile emissions, a hazardous air pollutant;
- Conducting a comprehensive review of compliance with emergency release reporting regulations;
- Implementing a comprehensive set of leak detection and repair (LDAR) practices that go beyond regulatory requirements.
The LDAR practices agreed to in the settlement include an innovative program to replace valves with new "low leak" valve technology and to monitor and repair equipment that is leaking at a lower rate than required by regulations, thereby reducing fugitive emissions from leaks.
EPA estimates that the settlement will reduce multiple harmful emissions from the facility’s historical operations including 360 tons of butadiene emissions per year from the flare controls, one ton of acrylonitrile emissions per year from the biofilter project and 60 tons per year in hazardous air pollutants from the enhanced LDAR program. Since the company was notified of its violations, they have implemented a series of emissions reduction projects to reduce these emissions.
EPA classifies acrylonitrile as a probable human carcinogen and butadiene as a known human carcinogen by inhalation. Some of the effects associated with short-term inhalation exposure to acrylonitrile and butadiene are similar and include irritation of the eyes, skin and respiratory tract and central nervous system effects such as drowsiness, dizziness, headaches and nausea. In addition, VOCs contribute to the formation of ozone. Ozone has been shown to be responsible for the reduction of lung function, respiratory symptoms, and increased lung inflammation. Ozone also causes damage to forests and crops, fabric, and exterior coatings such as oil and acrylic latex, oil coatings and automotive finishes.
According to the complaint filed simultaneously with the consent decree, the Addyston Facility allegedly violated the Clean Air Act’s requirements for monitoring and repairing leaks of hazardous air pollutants, and emitted hazardous air pollutants on more than 30 occasions in excess of the legal limits. The facility also failed to comply with requirements relating to the flare, which controls emissions of butadiene, a hazardous air pollutant, by repeatedly failing to meet a 99 percent control efficiency and minimum heat content requirement required by its permits. LANXESS also failed to immediately report releases of hazardous substances to proper federal, state and local emergency response authorities.
The consent decree, lodged today in the U.S. District Court for the Southern District of Ohio, 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 Department of Justice Web site at http://www.usdoj.gov/enrd/Consent_Decrees.html.
Justice Department Announces Disabled Access Settlement with Developers of Woodbridge, Virginia, Apartment ComplexRead the Press Release
WASHINGTON – The Justice Department today announced a settlement that, pending court approval, will resolve allegations that those involved in the design and construction of the Summerland Heights Apartments, a 318-unit apartment complex in Woodbridge, Va., discriminated on the basis of disability in the design and construction of the project.
The complaint, filed today in the U.S. District Court for the Eastern District of Virginia in conjunction with a consent decree, alleges that the defendants violated the federal Fair Housing Act. It cites a failure to design and construct the Summerland Heights Apartments so that ground floor units contain features of accessible design and the public use and common use areas are readily accessible to and usable by individuals with disabilities.
"Accessible housing is not only a civil right for individuals with disabilities, it is a basic necessity. Accessibility must be considered in the design and construction of new buildings, and the Justice Department is committed to enforcing the nation’s fair housing laws to protect the rights of all citizens, including those with disabilities," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division.
Under the settlement, the defendants will pay all costs related to retrofitting the apartment complex to make it accessible to persons with disabilities. The defendants must also establish a $40,000 fund which will be used to compensate individuals harmed by the inaccessible housing. The settlement also requires the defendants to undergo training on the requirements of the Fair Housing Act.
The required retrofitting includes modifying walkways to eliminate excess slopes and level changes, providing accessible curb ramps, and providing accessible parking and routes to site amenities, such as clubhouses, pools, mailboxes and trash facilities. The settlement also provides for the replacement of inaccessible knob door hardware with levers, and the widening of inaccessible doorways.
The defendants are: Summerland Heights GP LLC, Summerland Heights II GP LLC, Summerland Heights L.P., Summerland Heights II L.P., Charles P. Johnson & Associates Inc. and the Marlyn Development Corp.
The federal Fair Housing Act prohibits discrimination in housing based on race, color, religion, national origin, sex, disability or familial status. More information about the Civil Rights Division and the laws it enforces is available at http://www.usdoj.gov/crt. Individuals who believe that they may have been victims of housing discrimination can call the Housing Discrimination Tip Line (1-800-896-7743), e-mail the Justice Department at [email protected] or contact the U.S. Department of Housing and Urban Development at 1-800-669-9777.
Control Components Inc. Pleads Guilty to Foreign Bribery Charges and Agrees to Pay $18.2 Million Criminal FineRead the Press Release
Control Components Inc. (CCI), a Rancho Santa Margarita, Calif.-based company, pleaded guilty today to violations of the Foreign Corrupt Practices Act (FCPA) and the Travel Act in a decade-long scheme to secure contracts in approximately 36 countries by paying bribes to officials and employees of various foreign state-owned companies as well as foreign and domestic private companies.
Today, CCI entered guilty pleas to a three-count criminal information before U.S. District Judge James V. Selna in the Central District of California, Santa Ana Division. CCI designs and manufactures service control valves for use in the nuclear, oil and gas, and power generation industries. As part of the plea agreement, CCI agreed to pay a criminal fine of $18.2 million; create, implement and maintain a comprehensive anti-bribery compliance program; retain an independent compliance monitor for a three-year period to review the design and implementation of CCI’s anti-bribery compliance program and to make periodic reports to CCI and the Department of Justice; serve a three-year term of organizational probation; and continue to cooperate with the Department of Justice in its ongoing investigation.
Immediately following CCI’s guilty plea, Judge Selna imposed a sentence in accordance with the plea agreement. CCI was ordered to pay an $18.2 million criminal fine, placed on organizational probation for three years, and ordered to create and implement a compliance program and retain an independent compliance monitor for three years.
According to the information and plea agreement, from 1998 through 2007, CCI violated the FCPA and the Travel Act by making corrupt payments to numerous officers and employees of state-owned and privately-owned customers around the world, including in China, Korea, Malaysia and the United Arab Emirates,for the purpose of obtaining or retaining business for CCI. Specifically, from 2003 through 2007, CCI paid approximately $4.9 million in bribes, in violation of the FCPA, to officials of various foreign state-owned companies and approximately $1.95 million in bribes, in violation of the Travel Act, to officers and employees of foreign and domestic privately-owned companies. The alleged corrupt payments were made to foreign officials at state-owned entities including Jiangsu Nuclear Power Corp. (China), Guohua Electric Power (China), China Petroleum Materials and Equipment Corp., PetroChina, Dongfang Electric Corporation (China), China National Offshore Oil Corporation, Korea Hydro and Nuclear Power, Petronas (Malaysia) and National Petroleum Construction Company (United Arab Emirates).
In related cases, two former executives of CCI previously pleaded guilty to conspiring to bribe officers and employees of foreign state-owned companies on behalf of the valve company. Mario Covino, CCI’s former director of worldwide factory sales, pleaded guilty on Jan. 8, 2009, to one count of conspiracy to violate the FCPA and admitted to causing the payment of approximately $1 million in bribes to officers and employees of several foreign state-owned companies. Richard Morlok, CCI’s former finance director, pleaded guilty on Feb. 3, 2009, to one count of conspiracy to violate the FCPA and admitted to causing the payment of approximately $628,000 in bribes to officers and employees of several foreign state-owned companies. Covino and Morlok are scheduled to be sentenced on Jan. 25, 2010.
On April 8, 2009, six former CCI executives were charged in a 16-count indictment with violations of the FCPA, the Travel Act and other statutes. The six former CCI executives are Stuart Carson, CCI’s former chief executive officer; Hong (Rose) Carson, CCI’s former director of sales for China and Taiwan; Paul Cosgrove, CCI’s former director of worldwide sales; David Edmonds, CCI’s former vice president of worldwide customer service; Flavio Ricotti, CCI’s former vice-president and head of sales for Europe, Africa and the Middle East; and Han Yong Kim, the former president of CCI’s Korean office. Trial is currently scheduled for Dec. 8, 2009.
An indictment is merely an accusation and the defendant is presumed innocent until and unless proven guilty at trial beyond a reasonable doubt.
In total, CCI admitted that from 2003 through 2007, it made approximately 236 corrupt payments in more than 30 countries, which resulted in net profits to the company of approximately $46.5 million from sales related to those corrupt payments.
The case is being prosecuted by Assistant Chief Hank Bond Walther and Trial Attorney Andrew Gentin of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Douglas McCormick of the U.S. Attorney’s Office for the Central District of California. The case was investigated by the FBI’s Washington Field Office, and its team of special agents dedicated to the investigation of foreign bribery cases.
Information
Canadian National Charged with Foreign Bribery and <br /> Paying Kickbacks Under the Oil for Food ProgramRead the Press Release
A Canadian citizen has been charged in an indictment unsealed yesterday for his alleged participation in an eight-year conspiracy to defraud the United Nations Oil for Food Program (OFFP) and to bribe Iraqi government officials in connection with the sale of a chemical additive used in the refining of leaded fuel.
Ousama Naaman, 60, of Abu Dhabi, United Arab Emirates, was indicted on Aug. 7, 2008, in U.S. District Court for the District of Columbia. Naaman is charged with one count of conspiracy to commit wire fraud and to violate the Foreign Corrupt Practices Act (FCPA) and two counts of violating the FCPA. Naaman was arrested on July 30, 2009, in Frankfurt, Germany. The Department of Justice is seeking his extradition from Germany to the United States.
According to the indictment, from 2001 to 2003, acting on behalf of a publicly traded U.S. chemical company and its subsidiary, Naaman allegedly offered and paid 10 percent kickbacks to the then Iraqi government in exchange for five contracts under the OFFP. Naaman allegedly negotiated the contracts, including a 10 percent increase in the price to cover the kickback. In exchange for handling the kickbacks, Naaman allegedly received two percent of the contract value, in addition to the two percent commission he was paid for securing the contracts. The U.S. company allegedly inflated its prices in contracts approved by the OFFP to cover the cost of the kickbacks.
In addition, according to the indictment, in 2006 Naaman allegedly paid $150,000 in bribes on behalf of the U.S. company to Iraqi Ministry of Oil officials to ensure that a competing product manufactured by a different company failed a field test, keeping the competing product out of the Iraqi market. Naaman is alleged then to have provided the U.S. company with false invoices, on the basis of which the U.S. company reimbursed him for the bribes to the Iraqi officials.
If convicted on all charges, Naaman faces a maximum prison sentence of 15 years.
The case is being prosecuted by Trial Attorney Kathleen M Hamann of the Criminal Division’s Fraud Section. The case is being investigated by the Washington Field Office of the FBI. Significant assistance was provided by the Criminal Division’s Office of International Affairs, the U.S. Securities and Exchange Commission’s Division of Enforcement and the United Kingdom Serious Fraud Office’s United Nations Oil for Food Investigations Unit.
An indictment is merely an accusation and the defendant is presumed innocent until and unless proven guilty at trial beyond a reasonable doubt.
British Citizen Arrested in Connection with Costa Rica-based<br /> Business Opportunity Fraud VenturesRead the Press Release
WASHINGTON – A British citizen charged in connection with the operation of a series of fraudulent business opportunities was arrested Thursday evening in Miami following his indictment by a Miami federal grand jury on June 9, 2009, the Justice Department and the U.S. Postal Inspection Service announced today.
Dilraj Mathauda was arrested based on charges that he and his co-conspirators purported to sell beverage and greeting card business opportunities, including assistance in establishing, maintaining and operating such businesses. The charges form part of the government’s continued nationwide crackdown on business opportunity fraud.
According to the indictment, beginning in May 2005, Mathauda fraudulently induced victims to buy business opportunities in USA Beverages Inc. and Omega Business Systems Inc. for, in many cases, at least $10,000 each. Mathauda, using an alias, and his co-conspirators employed Voice Over Internet Protocol (VoIP) phone service and virtual offices in the U.S. to make it appear to potential purchasers that the companies’ operations were fully within the United States. Mathauda is alleged to have operated out of Costa Rica as he was fraudulently inducing potential purchasers to buy the purported business opportunities.
Mathauda and his co-conspirators allegedly made numerous false statements to potential purchasers of the business opportunities. According to the indictment, they falsely told their victims that the companies were established years earlier, had a significant number of distributors across the country, and had a track record of success. Potential purchasers were referred to references who, according to the indictment, told false tales of their success as business opportunity owners. Through these and other misrepresentations, purchasers of the business opportunities were led to believe that they would earn substantial profits.
"The federal government is committed to uncovering and vigorously prosecuting business opportunity fraud," said Tony West, Assistant Attorney General for the Department of Justice’s Civil Division. "In fact, we have charged over 100 individuals with business opportunity-related felonies in the past five years."
Mathauda is charged with conspiracy and with committing his offense via telemarketing. He is also charged with ten counts of mail fraud and two counts of wire fraud. If convicted on the conspiracy count, Mathauda faces a maximum sentence of 25 years imprisonment, a possible fine, and mandatory restitution. He also faces a maximum statutory term of 25 years imprisonment on each of the mail and wire fraud counts, a possible fine, and mandatory restitution.
"We will not allow individuals living in other countries to use modern communication techniques to commit fraud on the American public. This international and domestic investigation illustrates our resolve to protect the American people from business scams, wherever they occur," said U.S. Postal Inspector in Charge, Henry Gutierrez, based in Miami.
"The Postal Inspection Service remains vigilant in investigating and rooting out fraudulent schemes. Consumers must be aware that false references and empty promises of assistance locating display racks and merchandise are extremely common in this type of scam," said U.S. Postal Inspector in Charge Pete Zegarac, based in Phoenix. "These companies took over the corporate identities of businesses established long ago – so even claims of being in business for many years must be viewed with caution."
Assistant Attorney General West commended the investigative efforts of the Postal Inspection Service, as well as the Federal Trade Commission, which previously brought a related civil suit and made a criminal referral. This matter is being prosecuted by trial attorneys in the Justice Department’s Office of Consumer Litigation.
An indictment is merely an allegation, and every defendant is presumed innocent until proven guilty beyond a reasonable doubt.
Two Individuals Charged with Attempting to Bribe U.S. Army Contracting OfficialRead the Press Release
Two dual Afghan/U.S. citizens were charged today with conspiracy and bribery in connection with a scheme to offer $1 million in bribes to a U.S. Army contracting official in order to influence the award of a road construction contract in Afghanistan.
Rohullah Farooqi Lodin, 48, from Irvine, Calif., and Hashmatullah Farooqi, 38, from New York City, were charged today in a two-count indictment, returned by a federal grand jury in the Eastern District of Virginia. The indictment charges each defendant with one count of conspiracy to defraud and commit an offense against the United States and one count of attempting to bribe a public official.
The U.S. Army in Afghanistan is responsible for the Commander’s Emergency Response Program (CERP), which enables U.S. Army commanders in Afghanistan to use U.S. monies to fund humanitarian relief and reconstruction projects, including road construction, in that country. According to the indictment, in 2009, the U.S. Army solicited bids from contractors to design and build a road in Logar Province, Afghanistan (the Logar Road Contract). The U.S. Army received numerous bids on the Logar Road Contract, including $18 million bids each from National General Construction Company (NGCC) and Hamed Lais Group (Hamed Lais), both general contracting firms in Afghanistan that Lodin and Farooqi claimed to represent.
According to the indictment, on at least four occasions in May 2009, Lodin and Farooqi met with an Army captain who was the public official responsible for managing the CERP in Logar Province. Lodin and Farooqi told the Army captain that they represented NGCC and Hamed Lais, and were interested in securing the Logar Road Contract. According to the indictment, Lodin and Farooqi offered the Army captain $1 million in bribes if he agreed to assist in disqualifying lower bidders on the Logar Road Contract and influence the award of the contract to NGCC and Hamed Lais.
According to the indictment, Lodin and Farooqi stated they had political connections, and that to facilitate the award of the Logar Road Contract to Hamed Lais and NGCC, they could arrange for the blacklisting of lower priced bidders currently ranked ahead of their bid. The indictment also alleges that Lodin and Farooqi had numerous conversations with the Army captain and discussed the following options for paying him to influence the award of the Logar Road Contract: they stated they could wire the Army captain $1 million through Dubai or Bangkok a bank account; they offered to pay the Army captain $500,000 out of first payment under the contract and $500,000 at the conclusion of the contract; and, they offered to pay the Army captain $200,000 of the $1 million in cash before the award of the contract.
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 bribery count carries a maximum penalty of 15 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 Special Assistant U.S. Attorney Steve A. Linick, Deputy Chief of the Criminal Division’s Fraud Section, and Fraud Section Trial Attorney James J. Graham. The investigation is being conducted by the FBI; the U.S. Army Criminal Investigative Division; the Special Inspector General for Afghanistan Reconstruction; the Defense Criminal Investigative Service; and members of the National Procurement Fraud Task Force and the International Contract Corruption Task Force (ICCTF).
The National Procurement Fraud Task Force, 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, including in Afghanistan, Iraq and Kuwait.
An indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless and until convicted through due process of law.
Indictment
Third Crewmember Pleads Guilty to Charges Related to Pollution from Cargo ShipRead the Press Release
WASHINGTON—A Greek citizen who oversaw the engineering department on board a Dominica-flagged bulk cargo ship pleaded guilty today in U.S. District Court in New Orleans for violating environmental laws designed to prevent pollution from ships and making false statements to the U.S. Coast Guard, the Justice Department announced.
Georgios Stamou, the chief engineer of the M/V Theotokos, pleaded guilty to one felony violation of the Act to Prevent Pollution from Ships and one felony violation for making a false statement. Stamou is the third crewmember to plead guilty to crimes related to pollution from Theotokos while on the high seas. The captain of the ship, Panagiotis Lekkas, and the second ranking officer, Charles P. Posas, both pleaded guilty to multiple felony counts on July 15, 2009.
"Illegal pollution from ships continues to be a problem. Failing to properly dispose of bilge waste and lying to Coast Guard inspectors is unacceptable and those who choose to ignore the law face prosecution," said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division.
"This case clearly demonstrates the Coast Guard's commitment to work with our interagency partners to aggressively enforce all maritime anti-pollution and safety of life at sea laws. The breadth and magnitude of the investigation that underpinned the charges brought forth is a testament to the dedication of all persons who were involved in resolving this matter including the Coast Guard Investigative Service, the U.S. Department of Justice, and the U.S. Attorney for the Eastern District of Louisiana," said Rear Admiral Mary Landry, Eighth District Coast Guard commander.
According to court documents, Stamou was in charge of the engineering department and oversaw the ship’s machinery spaces, engines, propulsion system, and pollution prevention equipment including the oily water separator. At some point during Stamou’s employment on board the vessel, the oil water separator ceased functioning. During a voyage from Korea to Panama, Stamou spoke with a company representative and notified him that there was a problem with the oily water separator. Stamou did not utilize the oil water separator and directed crewmembers to discharge bilge waste that had accumulated during regular operation of the ship.
Engine room operations on board large oceangoing vessels such as the M/V Theotokos generate oil-contaminated bilge waste. International and U.S. law prohibit the discharge of bilge waste containing more than 15 parts per million of oil without treatment by an oily water separator - a required pollution prevention device. The International Convention for the Prevention of Pollution from Ships and federal law also require all overboard discharges be recorded in an oil record book, a standardized log which is regularly inspected by the Coast Guard.
Stamou at the time of his discharge directive was aware that bilge waste can only be legally disposed of at a shore side facility while at port or after being filtered through an oily water separator so that it contains less than 15 parts per million of petroleum. In court papers, Stamou admitted that he knew that to carry out his directive, the crew would discharge the waste directly overboard by routing the waste through the bilge line or sewage discharge valve, and not through the oil water separator. Additionally, none of the discharges were recorded, as required, in the vessel’s oil record book.
On Oct. 1, 2008, the Coast Guard boarded the Theotokos at Kenner Bend Achorage in Louisiana for a port state control inspection to ascertain its compliance with health, safety, and anti-pollution protocols. At that time, Stamou presented the false oil record book to Coast Guard inspectors.
A sentencing hearing has been scheduled for Stamou for Nov 5, 2009. Sentencing for both Lekkas and Posas is set for Oct. 14, 2009.
The case was investigated by the U.S. Coast Guard Investigative Service with assistance from inspectors from Sector New Orleans as well as legal from U.S. Coast Guard in New Orleans and at Headquarters in Washington, D.C. The case is being prosecuted by Christopher L. Hale of the Justice Department’s Environmental Crimes Section along with Dorothy Taylor of the U.S. Attorney’s Office in New Orleans.
Texas Gang Member Pleads GuiltyRead the Press Release
Almighty Latin King and Queen Nation (ALKQN) member David Hellums, aka "CutThroat," pleaded guilty today to a superseding indictment charging him and 16 co-defendants with various offenses related to alleged narcotics and weapons trafficking, as well as violent activities throughout Texas.
Specifically, Hellums, 35, of Big Spring, Texas, pleaded guilty to one count of conspiracy to distribute and possess with intent to distribute five kilograms or more of cocaine and 100 kilograms or more of marijuana. He faces a maximum statutory sentence of not less than 10 years and up to life in prison. U.S. District Judge Sam R. Cummings ordered a pre-sentence investigation with a sentencing date to be scheduled after that investigation is completed.
According to documents filed in court, Hellums admitted that he was a member of a conspiracy that included Jose Robledo Nava, aka "Chino;" Luis Nava, aka "Flaco;" Reynaldo Nava, aka "Rat;" Robert Allen Ramirez, aka "Nesyo;" Marie Chavez, aka "Shorty;" Carol Ann Rivas Nava; Cecily Dominique Juarez; Jesus Martinez, aka "Solid;" James Johnathan Cole, aka "Blitz;" Eduardo Daniel Mares, aka "Pitt;" Gabriel Lee Gonzales; Michael Conde, aka "Psycho;" Guerrero Olivas, aka "Screech;" John Guzman; Hiluterio Chavez, aka "Zeus;" and Eliseo Perez, aka "Wicked" and others, and that from 2001 until December of 2008, directly or indirectly agreed to distribute, and possess with intent to distribute, cocaine and marijuana.
Hellums admitted that the overall scope of the conspiracy involved at least five kilograms of cocaine and 100 kilograms of marijuana. Hellums further admitted that he and his co-defendants intentionally and knowingly possessed with the intent to distribute cocaine and marijuana and distributed cocaine and marijuana to others. According to the indictment, they acquired the cocaine and marijuana from Mexico and brought it to the South Texas region, where it was packaged, stored, and transported to Big Spring, Lubbock and Midland, Texas, for further distribution.
Hellums is the 12th defendant in the case to plead guilty. Others who have pleaded guilty include:
- Jesus Martinez, aka "Solid," 28, of Midland
- John Guzman, 30, of Big Spring
- Hiluterio Chavez, aka "Zeus," 33, of Chicago
- Eliseo Perez, aka "Wicked," 28, of Mission, Texas
- Luis Nava, aka "Flaco," 25, of Midland
- Reynaldo Nava, aka "Rat," 27, of Big Spring
- Marie Chavez, aka "Shorty," 28, of Lubbock
- Carol Ann Rivas Nava, 20, of Big Spring
- Cecily Dominique Juarez, 20, of Midland
- Guerro Olivas, aka "Screech," 26, of Big Spring
- Michael Conde aka "Psycho," 24, of Lamessa, Texas
The indictment also alleged that from 2004 through mid July 2005, defendants Jose Robledo Nava, Jesus Martinez, and Hiluterio Chavez conspired to deal in firearms. Last month, Jesus Martinez and Hiluterio Chavez pleaded guilty to conspiring to engage in the business of dealing firearms.
Jose Robledo Nava is allegedly the ALKQN leader in Texas. He, along with James Johnathan Cole, Robert Allen Ramirez, Gabriel Lee Gonzales and Eduardo Daniel Mares are charged in the indictment with the May 4, 2008, murders of Valerie Garcia and Michael Cardona, in Big Spring.
The case is being investigated by the National Gang Targeting, Enforcement, and Coordinating Center (Gang TECC); the Organized Crime Drug Enforcement Task Force (OCDETF); the Midland and El Paso U.S. Attorneys’ Offices; the U.S. Drug Enforcement Administration; the FBI; U.S. Immigration and Customs Enforcement; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the El Paso Intelligence Center; U.S. Customs and Border Protection; the U.S. Marshals Service; the Texas Department of Public Safety; the police departments of Lubbock, Midland, Houston, San Antonio and Big Spring, Texas; the Lubbock County Sheriff’s Office; and the Howard County District Attorney’s Office.
Assistant U.S. Attorney Cody L. Skipper of the Lubbock, Texas, U.S. Attorney’s Office and Trial Attorney Joseph A. Cooley of the Department of Justice’s Criminal Division’s Gang Unit are prosecuting the case.
Factual Resume
Plea Agreement
South Florida Stock Trader Sentenced to 30 Months<br /> in Prison for Role in Securities Fraud SchemeRead the Press Release
WASHINGTON – A stock trader from Jupiter, Fla., was sentenced today to 30 months in prison for engaging in securities fraud involving several publicly traded companies, Assistant Attorney General Lanny A. Breuer of the Criminal Division announced.
Paul M. Gozzo, 33, was sentenced today by U.S. District Judge Donald L. Graham in the Southern District of Florida. In addition to the prison sentence, Judge Graham ordered Gozzo to serve two years of supervised release following his release from prison and to forfeit more than $437,000 in net profits from his criminal conduct.
Gozzo pleaded guilty on March 17, 2009, to one count of conspiracy to commit securities fraud and one count of securities fraud. In his plea, Gozzo admitted to engaging in a market manipulation scheme with two co-conspirators for the purpose of artificially inflating the prices of several publicly traded stocks. Gozzo also admitted that he and his co-conspirators manipulated the stock price of several stocks by, among other things, creating the false appearance that there was greater investor interest and liquidity in the stocks than actually existed. In return for his assistance in manipulating the stock prices of these companies, Gozzo admitted that he received approximately $540,000, which resulted in a profit to Gozzo of more than $437,000.
According to information contained in plea documents, Gozzo admitted that he conspired with a purported investment banker, who owned large amounts of stock in several public companies, and the investment banker’s son to artificially increase the stock price of those companies. They did so, according to court documents, by providing support bids for shares of those companies and by engaging in coordinated trades with each other and others for the purpose of keeping the stock price artificially inflated and further inflating the stock price. This created the impression that there was a greater investor interest in the stock than truly existed, which allowed Gozzo and his co-conspirators to sell that stock at an artificially high price. Gozzo admitted that he and his co-conspirators also bought and sold stock through numerous broker-dealers to make it appear that there were several investors trading in the stocks they were manipulating, when in fact there were not additional investors. In return for Gozzo’s assistance in manipulating the stock prices of these companies, the investment banker compensated Gozzo in the form of cash retainer payments and both free-trading and restricted stock.
This case was prosecuted by Assistant Chief Hand Bond Walther and Trial Attorney Nicole H. Sprinzen of the Criminal Division’s Fraud Section and is being investigated by the FBI’s Washington Field Office. Significant assistance was provided by the U.S. Securities and Exchange Commission.
New Mexico-based Computer Assets Inc. Agrees to Settle <br /> False Claims Allegations Involving the E-Rate ProgramRead the Press Release
WASHINGTON – Computer Assets Inc. and its principals, Abraham Salazar and Damon Salazar, have agreed to pay $350,000 over three years and surrender up to $35 million in pending E-Rate applications to settle allegations that the company violated the False Claims Act in connection with the Federal Communications Commission’s E-Rate program, the Justice Department and the U.S. Attorney’s Office for the District of New Mexico announced today.
The E-Rate program, which Congress created in the Telecommunications Act of 1996, provides funding for needy schools and libraries to connect to and utilize the Internet. Under the program, which is supported by fees collected from telephone users, schools apply for funds to pay for hardware and monthly connectivity service fees.
The United States contended that the Española, N.M.-based company violated the E-Rate program’s requirements by engaging in non-competitive bidding practices for E-Rate contracts with the Kayenta Unified School District in Kayenta, Ariz. Additionally, the United States alleged that Computer Assets billed for installing excess and unnecessary networking cable, and in some instances billed twice for the same work.
These allegations arose from a False Claims Act lawsuit filed in New Mexico federal court by John Lyons, a former Computer Assets employee. The False Claims Act allows private individuals to bring civil actions for fraud on behalf of the United States and to share in the proceeds of any recovery. Mr. Lyons’ share in the settlement will amount to $77,000.
"The E-Rate program provides critical support for Internet access to the most under-served schools in the nation," said Tony West, Assistant Attorney General for the Department of Justice’s Civil Division. "Working with our partners at the FCC’s Office of the Inspector General, the Department of Justice is committed to ensuring that this important program, which benefits our neediest children, not be misused by those seeking to defraud the public."
The Justice Department’s Civil Division, with assistance from the FCC’s Office of the Inspector General, handled the investigation and settlement of this matter. The case is entitled United States ex rel. John Lyons v. Computer Assets, Inc. et al., Case No.: 05-540 RB/WPL.
Massachusetts Man Convicted on Child Pornography ChargesRead the Press Release
Johnny Pires, 24, of Middleboro, Mass., was convicted today by a federal jury in Boston of attempting to receive child pornography and possessing child pornography.
Pires was indicted on two counts of attempting to receive child pornography and one count of possessing child pornography. Following a four-day trial before U.S. District Judge Rya W. Zobel, a jury today convicted Pires of the second count of attempting to receive child pornography, and of possessing child pornography.
According to evidence presented during the trial, the case arose from an FBI undercover operation that targeted individuals using file sharing programs to trade child pornography. Testimony from an undercover agent established that Pires was using Limewire, a file share program that allows users to exchange image and video files for free, to share images of child pornography. The agent testified that during his investigation, he downloaded images depicting children engaged in sexually explicit conduct from Pires and was able to access Pires’ shared folder. During the review of Pires’ shared folder, the agent discovered numerous images of child pornography depicting pre-pubescent children engaged in various sexual acts. Based on this information, a search warrant was executed at Pires’ residence, and Pires admitted to accessing child pornography through file share programs and downloading images of the sexual abuse of children. A forensic examiner testified that a hard drive seized from Pires’ residence revealed numerous images of child pornography, including those downloaded from Limewire.
At sentencing, Pires faces a minimum of five years in prison and up to 20 years. He will also face a lifetime term of supervised release following his prison sentence. Sentencing is scheduled for October 22, 2009.
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 jointly by Assistant U.S. Attorney Thomas Kanwit for the District of Massachusetts and Trial Attorney LisaMarie Freitas of the Criminal Division’s Child Exploitation and Obscenity Section. The case was investigated by the FBI.
Manhattan Return Preparer Pleads Guilty to Filing False Tax ReturnsRead the Press Release
WASHINGTON – Stavros Lubinof, owner of Apollo Tax Services in mid-town Manhattan, N.Y., pleaded guilty today to tax charges, the Justice Department and Internal Revenue Service (IRS) announced. Lubinof waived indictment and pleaded guilty to a two count criminal information charging him with conspiracy to defraud the IRS and with aiding and assisting in the preparation and filing of false and fraudulent income tax returns.
According to the criminal information and statements made during the plea hearing, from 2000 through spring 2005, Lubinof owned and operated Apollo Tax Services. While preparing income tax returns for clients at Apollo, Lubinof fabricated or inflated Schedule A deductions, such as exaggerated or fictitious unreimbursed employee expenses and gifts to charity. This thereby lowered the amount of tax due and owed by Apollos clients that was reported on their individual income tax returns. The total tax loss attributable to the conspiracy is $102,859.
U.S. District Court Judge P. Kevin Castel scheduled sentencing of Lubinof for Nov. 20, 2009 at 11 a.m. Lubinof faces a maximum sentence of eight years in prison and a maximum fine of $500,000 or twice the amount of financial gain to the defendant or loss to the IRS.
In October 2008, an employee of Lubinof at Apollo, Christos Antonakas, pleaded guilty to a two count information charging him for his role in a criminal conspiracy to defraud the IRS and for aiding and assisting in the preparation and filing of materially false income tax returns. During the plea hearing, Antonakas admitted that from 2000 through spring 2005, he worked as a tax return preparer for Apollo where he was instructed by Lubinof to fabricate or inflate Schedule A deductions for Apollo's clients, thereby lowering the amount of tax due and owing reported on their individual income tax returns.
Antonakas is scheduled to be sentenced by U.S. District Court Judge Barbara S. Jones on Aug. 21, 2009. Antonakas faces a maximum sentence of eight years in prison and a maximum fine of $500,000 or twice the amount of monetary gain to the defendant or loss to the IRS.
Acting Assistant Attorney General John A. DiCicco of the Justice Departments Tax Division commended the IRS-Criminal Investigation special agents who investigated the case, as well as Tax Division trial attorney Michael P. BenAry, who prosecuted the case and the U.S. Attorneys Office for the Southern District of New York for their assistance in the case.
Key Member of Atlanta Human Trafficking Ring Pleads Guilty <br /> to Sex Trafficking ChargesRead the Press Release
WASHINGTON – The Justice Department today announced that Juan Cortes-Meza, a Mexican National, pleaded guilty in federal district court in Atlanta to sex trafficking offenses involving young Mexican women and girls. Otto Jaime Larios Perez, a Guatemalan National, also pleaded guilty today to making a false statement to law enforcement and, thereby, obstructing a human trafficking investigation. Earlier this year, two other defendants charged in the same indictment, Francisco Cortes-Meza and Raul Cortes-Meza, pleaded guilty to sex trafficking offenses.
From Spring 2006 through June 2008, Juan Cortes-Meza, 31, and others charged in the conspiracy recruited and enticed approximately 10 victims to come to the Atlanta area from Mexico to engage in prostitution for the financial benefit of the members of the alleged conspiracy, according to information presented in court. With false promises of better lives, legitimate employment or marriage, Juan Cortes-Meza lured young, impoverished, rural Mexican women and girls with limited education, knowing the victims would actually be compelled into prostitution through a scheme of strict controls and physical violence.
The defendants who brought the victims into the United States used drivers, including defendant Larios Perez, 25, to transport the victims to the locations where they were forced to engage in acts of prostitution. Larios Perez was prosecuted for false statements he made when law enforcement officers stopped him with a victim in his car.
"Human trafficking and forced prostitution deny the victims not only their freedom, but also their dignity, and this sort of abhorrent illegal conduct will not be tolerated. We are committed to combating human trafficking and prosecuting those who exploit vulnerable women and girls for financial benefit," said Acting Assistant Attorney General Loretta King of the Civil Rights Division. "I applaud the many hardworking investigators and attorneys who have toppled this ring and brought its members to justice."
"Human trafficking is modern day slavery that robs individuals of their freedom and can have lasting psychological harm. Compelling women or girls by force, fraud or coercion to engage in commercial sex acts is a serious violation of federal law. This insidious abuse preys upon those who may be vulnerable due to their immigration status, unfamiliarity with this country’s legal system or fear law enforcement," said U.S. Attorney David E. Nahmias for the Northern District of Georgia. "Federal laws protect all victims of such heinous crimes whether or not they are citizens. No victim should fear coming forward to report illegal activity and criminal abuse."
Sentencing hearings for defendants Juan Cortes-Meza and Otto Jaime Larios Perez related to the pleas entered today have not yet been set. The sex trafficking offense carries a mandatory minimum sentence of 10 years in federal prison. In determining the actual sentence for both defendants, the Court will consider the U.S. Sentencing Guidelines, which are not binding but provide advisory sentencing ranges.
This case is being investigated by Special Agents of U.S. Immigration and Customs Enforcement (ICE). Assistant U.S. Attorneys Corey Steinberg and Susan Coppedge and Trial Attorney Karima Maloney of the Civil Rights Division’s Human Trafficking Prosecution Unit are prosecuting the case.
Justice Department Signs Agreement with Niagara Falls<br /> to Ensure Civic Access for People with DisabilitiesRead the Press Release
WASHINGTON – The Justice Department today announced an agreement with the city of Niagara Falls, N.Y., to improve access to all aspects of civic life for persons with disabilities. The agreement was reached under the Department’s Project Civic Access initiative to bring state and local governments into compliance with the Americans with Disabilities Act (ADA). This agreement is the 164th under Project Civic Access.
"Officials in Niagara Falls recognize that civic access is a civil right, and I applaud them for working to ensure that all citizens, including individuals with disabilities, can enjoy one of America’s most treasured and visited landmarks," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "This agreement helps mark the 19th anniversary of the Americans with Disabilities Act, and we are pleased to take this major step forward in our mission to improve accessibility nationwide."
Under the agreement announced today, the city of Niagara Falls will take several steps to improve access for persons with disabilities, including:
- Making physical modifications to facilities so that parking, routes into the buildings, entrances, public telephones, restrooms, service counters and drinking fountains are accessible to individuals with disabilities;
- Officially recognizing New York state’s telephone relay service, and training staff in using the city TTY relay service;
- Continuing to ensure that the 9-1-1 emergency service TTY calls are answered as quickly as other calls received, that such calls are monitored for timing and accuracy if other calls are monitored, and that employees are trained and practiced in using a TTY to make and receive calls;
- Ensuring that the city’s official Web site is accessible to persons with disabilities;
- Develop a method for ensuring that voters with disabilities have an equal opportunity to vote by providing accessible voter registration locations and polling places, and by training poll workers on the rights of persons with disabilities and the practical aspects of assuring those rights;
- Ensuring equal access to Niagara County’s emergency management programs and services for persons with disabilities, including preparation, notification, response and clean up; and
- Implementing a plan on accessibility of sidewalks and curb cuts throughout the city.
Project Civic Access was initiated to ensure that persons with disabilities have an equal opportunity to participate in civic life. As part of the project, Justice Department investigators, attorneys and architects conduct on-site surveys of state and local government programs and facilities for the purpose of identifying modifications needed for compliance with ADA requirements. The agreements contain a plan setting out the specific steps a community will take to improve access for persons with disabilities.
People interested in finding out more about the ADA, today’s agreement with the city of Niagara Falls or the Department’s Project Civic Access initiative may find this information on the ADA Web site at http://www.ada.gov or may call the toll-free ADA Information Line at (800) 514-0301 or (800) 514-0383 (TTY).
Justice Department Requires Divestiture in Sapa’s Acquisition of IndalexRead the Press Release
WASHINGTON — The Department of Justice announced today that it has reached a settlement that will require Sapa Holding AB and Indalex Holdings Finance Inc. to divest a North Carolina aluminum sheathing facility in order to proceed with Sapa’s proposed $150 million acquisition of Indalex. The Department said that the transaction, as originally proposed, would substantially lessen competition for the manufacture and sale of aluminum sheathing (coiled extruded aluminum tubing) used in the manufacture of high frequency coaxial cable in the United States, resulting in increased prices and reduced quality, service and innovation.
The Department said that the companies must divest either Sapa’s Catawba, N.C. aluminum sheathing manufacturing plant or Indalex’s aluminum sheathing facility at its Burlington, N.C., plant in order to proceed with the deal.
The Department’s Antitrust Division filed a civil antitrust lawsuit today in U.S. District Court in Washington, D.C., to block the proposed transaction. At the same time, the Department filed a proposed settlement that, if approved by the court, would resolve the lawsuit and the Department’s competitive concerns.
"The original proposed transaction threatened to deprive consumers of the benefits of competition," said Christine A. Varney, Assistant Attorney General in charge of the Department’s Antitrust Division. "Without the divestiture required by the Department, purchasers of aluminum sheathing in the United States likely would have faced higher prices and reduced quality and innovation."
According to the complaint, Sapa and Indalex are the only two manufacturers of aluminum sheathing in the United States. Indalex is currently involved in bankruptcy proceedings. Aluminum sheathing is used to make coaxial cables that are purchased by cable television companies in the United States and abroad for use in transmitting high frequency broadband signals to their subscribers. Aluminum sheathing is made to exacting specifications to provide protection for the components of the cables to prevent the loss of the transmission signal to subscribers.
Under the proposed settlement, in the event the companies are unable to sell either the Catawba, N.C. or Burlington, N.C. facility promptly to a viable purchaser acceptable to the Department, they must sell Indalex’s entire Burlington, N.C. extruded aluminum plant, which produces fabricated aluminum products, such as conduit and aluminum shapes, in addition to aluminum sheathing.
Sapa is a Swedish corporation with its principal place of business in Stockholm, Sweden. Sapa sells fabricated aluminum products throughout the world, including in the United States, where it is the largest aluminum extrusion fabricator. In 2008, its sales of the product were about $30.7 million. Sapa is owned by Orkla ASA, a Norwegian public limited company whose offices are located in Skøyen, Oslo in Norway. Orkla is a large, diversified international company with operations throughout the world.
Indalex is a Delaware corporation with its principal place of business in Lincolnshire, Ill. Indalex sells fabricated aluminum products in Canada and the United States. Indalex is the second largest aluminum extrusion fabricator in the United States. In 2008, its sales of the product were about $12 million.
As required by the Tunney Act, the proposed settlement, along with a competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed settlement during a 60-day comment period to Maribeth Petrizzi, 450 Fifth Street N.W., Suite 8700, Washington, D.C. 20530. At the conclusion of the 60-day comment period, the court may enter the final judgment upon a finding that it serves the public interest.
Justice Department Requires Divestiture in Sapa’s Acquisition of IndalexRead the Press Release
WASHINGTON — The Department of Justice announced today that it has reached a settlement that will require Sapa Holding AB and Indalex Holdings Finance Inc. to divest a North Carolina aluminum sheathing facility in order to proceed with Sapa’s proposed $150 million acquisition of Indalex. The Department said that the transaction, as originally proposed, would substantially lessen competition for the manufacture and sale of aluminum sheathing (coiled extruded aluminum tubing) used in the manufacture of high frequency coaxial cable in the United States, resulting in increased prices and reduced quality, service and innovation.
The Department said that the companies must divest either Sapa’s Catawba, N.C. aluminum sheathing manufacturing plant or Indalex’s aluminum sheathing facility at its Burlington, N.C., plant in order to proceed with the deal.
The Department’s Antitrust Division filed a civil antitrust lawsuit today in U.S. District Court in Washington, D.C., to block the proposed transaction. At the same time, the Department filed a proposed settlement that, if approved by the court, would resolve the lawsuit and the Department’s competitive concerns.
"The original proposed transaction threatened to deprive consumers of the benefits of competition," said Christine A. Varney, Assistant Attorney General in charge of the Department’s Antitrust Division. "Without the divestiture required by the Department, purchasers of aluminum sheathing in the United States likely would have faced higher prices and reduced quality and innovation."
According to the complaint, Sapa and Indalex are the only two manufacturers of aluminum sheathing in the United States. Indalex is currently involved in bankruptcy proceedings. Aluminum sheathing is used to make coaxial cables that are purchased by cable television companies in the United States and abroad for use in transmitting high frequency broadband signals to their subscribers. Aluminum sheathing is made to exacting specifications to provide protection for the components of the cables to prevent the loss of the transmission signal to subscribers.
Under the proposed settlement, in the event the companies are unable to sell either the Catawba, N.C. or Burlington, N.C. facility promptly to a viable purchaser acceptable to the Department, they must sell Indalex’s entire Burlington, N.C. extruded aluminum plant, which produces fabricated aluminum products, such as conduit and aluminum shapes, in addition to aluminum sheathing.
Sapa is a Swedish corporation with its principal place of business in Stockholm, Sweden. Sapa sells fabricated aluminum products throughout the world, including in the United States, where it is the largest aluminum extrusion fabricator. In 2008, its sales of the product were about $30.7 million. Sapa is owned by Orkla ASA, a Norwegian public limited company whose offices are located in Skøyen, Oslo in Norway. Orkla is a large, diversified international company with operations throughout the world.
Indalex is a Delaware corporation with its principal place of business in Lincolnshire, Ill. Indalex sells fabricated aluminum products in Canada and the United States. Indalex is the second largest aluminum extrusion fabricator in the United States. In 2008, its sales of the product were about $12 million.
As required by the Tunney Act, the proposed settlement, along with a competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed settlement during a 60-day comment period to Maribeth Petrizzi, 450 Fifth Street N.W., Suite 8700, Washington, D.C. 20530. At the conclusion of the 60-day comment period, the court may enter the final judgment upon a finding that it serves the public interest.
Helmerich & Payne Agrees to Pay $1 Million Penalty to Resolve Allegations <br /> of Foreign Bribery in South AmericaRead the Press Release
Helmerich & Payne Inc. (H&P) has entered into an agreement with the Department of Justice to resolve improper payments by H&P to government officials in Argentina and Venezuela in violation of the Foreign Corrupt Practices Act (FCPA).
H&P, a Delaware corporation, is headquartered in Tulsa, Okla., and is listed on the New York Stock Exchange. The company provides oil drilling rigs, equipment and personnel on a contract basis, primarily in the United States and South America, with subsidiaries in both Argentina and Venezuela.
As described in the agreement, H&P has acknowledged responsibility for the actions of its subsidiaries, employees and agents who made various improper payments to officials of the Argentine and Venezuelan customs services, both government agencies. These payments were made in order to import and export goods that were not within regulations, to import goods that could not lawfully be imported, and to evade higher duties and taxes on the goods.
The agreement requires that H&P pay a $1 million penalty, implement rigorous internal controls and cooperate fully with the Department. The agreement recognizes H&P’s voluntary disclosure and thorough self-investigation of the underlying conduct, the cooperation provided by the company to the Department, and the extensive remedial efforts undertaken by the company.
As a result of these mitigating factors, the Department has agreed not to prosecute H&P or its subsidiaries for the making of improper payments, provided that H&P satisfies its obligations under the agreement for a period of two years. Those obligations include ongoing cooperation, payment of the $1 million penalty and further remedial steps.
In a related matter, H&P reached a settlement today with the U.S. Securities and Exchange Commission under which it agreed to pay more than $375,000 in disgorgement of profits, including pre-judgment interest.
This case is being prosecuted by Trial Attorney Kathleen M. Hamann of the Criminal Division’s Fraud Section.
Fourteen Motorcycle Gang Leaders and Members Plead Guilty <br /> in Detroit to Violent Crime, Drug and Firearms ChargesRead the Press Release
Fourteen members of the Outlaws Motorcycle Club have pleaded guilty in Detroit to charges including violent crimes in aid of racketeering, illegal drug distribution and firearms violations.
The guilty pleas included leaders, members and gang associates of Outlaws’ chapters in Fort Wayne, Ind., Indianapolis, and areas of Detroit including Eastside, Detroit Westside, Downriver and Bay City. The defendants were charged with various crimes including violent crimes in aid of racketeering; conspiracy to commit violent crimes in aid of racketeering; distribution and possession with intent to distribute cocaine, methamphetamine, marijuana and hashish; possessing a firearm after conviction for a felony; and sale of a firearm to a known felon.
"Unfortunately, far too many Americans live in fear of gang-related violence," said Assistant Attorney General Lanny A. Breuer. "By working with our federal, state and local partners to target these gangs, we take violent individuals off the street and weaken the chokehold that gangs like the Outlaws have on our communities."
"The guilty pleas by a large number of leaders and members of this illegal motorcycle gang are a good example of the success that comes from effective federal, state and local law enforcement cooperation," said U.S. Attorney Terrence Berg. "This case has managed to put a damper on the heightened dangers of violence and other criminal acts posed by organized gangs such as the Outlaws. The ATF, FBI and their state and local law enforcement partners did an excellent job in bringing the down the illegal activities of the Outlaws in the Eastern District of Michigan."
"One of ATF’s primary missions is to make our communities safer from the criminal activity of violent gangs, such as the Outlaws. The magnitude of the pain, suffering and fear that violent gangs bring to our communities is immeasurable," said Thomas Brandon, Special Agent-in-Charge of the ATF Detroit Field Division. "ATF, along with our local, state and federal partners, remains committed to stemming the hold that violent gangs like the outlaws have on our neighborhoods."
The guilty pleas were the result of "Operation Broken Spoke," "Operation Detroit Mugger," and "Operation End Game," a five-year investigation by the ATF; the FBI; the National Drug Intelligence Center; Michigan State Police; the Detroit Police Department; the South Bend, Ind., Police Department; and the Fort Wayne Police Department.
The following Michigan and Indiana Outlaws members and associates pleaded guilty:
NAME
DATE OF PLEA
CHARGE
Leroy Frasier, aka "Leroy"
July 30, 2009
Conspiracy to commit assault with a dangerous weapon
David Dorris, aka "Hoggs"
July 27, 2009
Conspiracy to commit assault with a dangerous weapon
Ramon Rios, aka "Ramon"
July 23, 2009
Conspiracy to commit assault with a dangerous weapon
Norman Box Jr., aka "Stormin Norman"
June 23, 2009
Assault with a dangerous weapon
Michael Radke, aka "Mike"
June 23, 2009
Distribution of cocaine
Edward Gallagher, aka "Eddie"
June 23, 2009
Distribution of methamphetamine
Danny Neace, aka "Milky"
June 12, 2009
Assault with a dangerous weapon
Bruce Wendel, aka "Big Bruce"
June 12, 2009
Assault with a dangerous weapon
Kim Galaviz, aka "Moe"
June 12, 2009
Distribution of cocaine
William Thomas McCowan, aka "Tom the Bomb"
June 10, 2009
Possession of hashish
William Merfert, aka "Billy"
June 10, 2009
Felon in possession of firearms
William Elston, aka "Jason"
June 9, 2009
Assault with a deadly weapon resulting in serious bodily injury
Mark Guerra, aka "Skid Mark"
April 1, 2009
Distribution of marijuana
William Guinn, aka "Slick"
Aug. 25, 2008
Distribution of marijuana
Robert Castillo, aka "Big Rob" and "Mexican Rob," is currently awaiting trial on charges of distributing cocaine. Kenneth Creslaw, aka "KC," is charged with distributing marijuana and remains a fugitive.
The original 18-count indictment alleged that the Outlaws Motorcycle Club is an enterprise whose members allegedly committed, attempted to, and threatened to commit acts of violence to protect and expand the gang’s criminal operations. Several of the defendants were charged with allegedly assaulting various members of the rival Hells Angels Motorcycle Club, in some cases with dangerous weapons including a hammer, motorcycle parts and a cane. Several defendants allegedly trafficked in the sale of narcotics, including methamphetamine, marijuana, hashish and cocaine, while others were charged with various firearms offenses.
The Outlaws Motorcycle Club has been identified as an international criminal organization whose members and associates engage in acts of violence including murder, attempted murder, assault, robbery, kidnapping, narcotics sales and distribution, illegal firearms trafficking and gambling offenses. The Outlaws are a structured and hierarchical gang, divided into multiple regions in the United States. The Outlaws also have members worldwide, including Europe, Asia and Canada. The Outlaws have a long-standing violent history with the Hells Angels Motorcycle Club, including assaults/batteries, shootings and fatalities.
The Detroit Outlaws case was prosecuted by Assistant U.S. Attorneys Diane L. Marion and Julie Beck of the Eastern District of Michigan, as well as Trial Attorney Sam Nazzaro of the Criminal Division’s Gang Unit.
The law enforcement actions in Detroit are the result of the Justice Department’s ongoing anti-gang initiative and the joint strategic and priority targeting of violent street gangs by the ATF, FBI, the National Gang Targeting, Enforcement and Coordination Center (GangTECC), the National Gang Intelligence Center and state and local law enforcement. The Criminal Division’s Gang Unit, a specialized group of federal prosecutors charged with attacking the most significant regional, national and international gangs in the United States, works with fellow prosecutors around the country to disrupt and dismantle gang activity in communities. In addition, the Gang Unit works with domestic and foreign law enforcement agencies to construct effective and coordinated prevention and enforcement strategies.
Former Congressional Chief of Staff Sentenced <br /> for Honest Services Fraud ConspiracyRead the Press Release
A former chief of staff to a member of the U.S. House of Representatives was sentenced today by U.S. District Judge Henry H. Kennedy Jr. to three years of probation, including 170 days of home detention, and ordered to perform 100 hours of community service.
On Dec. 7, 2007, Russell James Caso Jr., 36, of Canton, Ga., pleaded guilty before Judge Kennedy in U.S. District Court for the District of Columbia to a one-count criminal information charging him with conspiracy to commit honest services wire fraud. According to court documents, Caso served as a chief of staff to the Representative from 2005 until 2007. Caso’s guilty plea stems from his relationship with a firm that, according to court documents, had a stated mission of helping American businesses operate in Russia and facilitating the flow of trade between the United States and Russia.
According to court documents, the firm sought to submit its proposals seeking federal funding for these efforts to various executive branch agencies. The firm’s general secretary met frequently with and sought official action from Caso, the Representative for whom he worked and the Representative’s staff, including their assistance in obtaining funding for the proposals.
Caso admitted that the firm’s general secretary paid his wife a total of $19,000. According to court documents, Caso’s wife received $1,500 to edit written drafts of the firm’s proposals. After being paid for editing the proposals, Caso’s wife received and deposited three more checks totaling $17,500 from the firm between May and August 2005. Caso admitted that he knew his wife did very little additional work beyond editing the proposals in return for this money.
According to court documents, Caso organized meetings in mid-2005 where he and others made presentations and argued to various executive branch agencies, including the Departments of State and Energy and the National Security Council, that the firm’s proposals should be federally funded.
As chief of staff, Caso was required to submit annual financial disclosure statements, listing the source of any income earned by his wife, among other things. On the disclosure statement for 2005, Caso admitted he intentionally failed to disclose that his wife received any payments from the firm even though he knew that he was required to do so. In pleading guilty, Caso admitted that one reason for this non-disclosure was that he knew that his wife’s financial relationship with the firm created a personal conflict of interest because the firm was seeking his help to obtain federal funding.
During the sentencing hearing, the Department of Justice asked the court to reduce Caso’s sentence based on his substantial cooperation in the government’s continuing investigation.
The case was prosecuted by Assistant U.S. Attorney Howard Sklamberg from the U.S. Attorney’s Office for the District of Columbia as well as Trial Attorneys Armando O. Bonilla of the Criminal Division’s Public Integrity Section and Gregory C.J. Lisa of the Criminal Division’s Organized Crime & Racketeering Section. The case was investigated by the FBI and the Internal Revenue Service.
Medicare Fraud Strike Force Operations Lead to Charges Against 32 Doctors and Health Care Executives for More Than $16 Million in Alleged False Billing in HoustonRead the Press Release
WASHINGTON – Thirty-two people have been indicted for schemes to submit more than $16 million in false Medicare claims in the continuing operation of the Medicare Fraud Strike Force in Houston, Deputy Attorney General David W. Ogden and Deputy Secretary Bill Corr of the Department of Health and Human Services (HHS) announced today. The Strike Force in Houston is the fourth phase of a targeted criminal, civil and administrative effort against individuals and health care companies that fraudulently bill the Medicare program.
While the indictments were returned by a grand jury in Houston, individuals were arrested today in Houston, New York, Boston and Louisiana. In addition, Strike Force agents executed 12 search warrants at health care businesses and homes across the Houston area.
The joint DOJ-HHS Medicare Fraud Strike Force is a multi-agency team of federal, state and local investigators designed to combat Medicare fraud through the use of Medicare data analysis techniques and an increased focus on community policing. The fourth phase was announced in May 2009, with agents from FBI, HHS Office of the Inspector General (HHS-OIG), the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU), the Drug Enforcement Administration (DEA), Office of Personnel Management, Office of the Inspector General (OPM-OIG) and the Office of the Inspector General at the Railroad Retirement Board (RRB-OIG).
"Our Medicare Strike Force is striking back against health care fraud in all its forms and wherever it occurs. We will stop fraud as its happening, using real-time data analysis of Medicare billing records," said Deputy Attorney General David W. Ogden. "Those who commit health care fraud will not be allowed to steal money from American taxpayers. Anyone operating or considering operating a health care fraud scheme around the country should take notice that they will be held accountable."
"When criminals rip off Medicare beneficiaries, we all pay the price. These false Medicare schemes and scams are costing the taxpayers millions of dollars, harming Medicare beneficiaries and driving up the cost of health care, but thanks to this new innovative partnership and the hard work of our staff on the ground, we are starting to fight back against fraud in a big way. The Administration’s HEAT initiative and our Strike Forces are making a big difference in a very short amount of time, returning millions back to the Medicare Trust in just a few months," said Bill Corr, Deputy Secretary of Health and Human Services and the top HHS official on the HEAT Team. "We are also working together across the federal government on important new innovations in the way we do business on the front end, to try and prevent crime like this from happening in the first place."
The Strike Force operations in Houston are another important step of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their joint efforts to reduce and prevent Medicare and Medicaid fraud through enhanced cooperation. The HEAT taskforce, co-chaired by Deputy Attorney Ogden and Deputy Secretary Corr, is made up of top-level law enforcement agents, prosecutors and staff from both Departments and their operating divisions. In the May 2009 announcement, Attorney General Eric Holder and Secretary Kathleen Sebelius announced the expansion of the Strike Force into Detroit and Houston to build upon existing partnerships between the agencies in a heightened effort to reduce fraud and recover taxpayer dollars.
Charges were unsealed today against 32 individuals who are accused of various Medicare fraud offenses, including conspiracy to defraud the Medicare program, and criminal false claims. The Strike Force operations in Houston have identified the primary fraud schemes as those related to false billing for "arthritis kits," power wheelchairs and enteral feeding supplies.
According to the indictments, the defendants charged today participated in schemes to submit claims to Medicare for products that were in fact medically unnecessary and oftentimes, never provided. In some cases, indictments allege that beneficiaries were deceased at the time they allegedly received the items. Collectively, the physicians, company owners and executives charged in the indictments are accused of conspiring to submit more than $16 million in false claims to the Medicare program.
"Americans deserve quality healthcare and have the right to expect that money expended on Medicare is not wasted," said U.S. Attorney Tim Johnson. "We will prosecute anyone who fraudulently obtains Medicare benefits at the expense of the truly needy."
"We will protect the Medicare program and its beneficiaries by stopping those who falsely bill for power wheelchairs, orthotic devices and other supplies that are not needed," said Daniel R. Levinson, Inspector General of the Department of Health & Human Services. "Today’s arrests demonstrate the significant impact of the new HEAT strike force on combating fraud and abuse in the Houston area."
"We will continue to work together to combat those who corrupt the system and wish to line their pockets with taxpayer dollars," said Special Agent in Charge Richard C. Powers, FBI Houston Field Office. "Healthcare fraud strikes at the heart of our health care system and our economy."
Texas Attorney General Greg Abbott added: "Today’s arrests reflect a concerted effort to crack down on those who defraud Texas taxpayers. We will continue working with our federal partners to uncover waste, fraud, and abuse in the Medicare and Medicaid systems."
Since the inception of Strike Force operations in March 2007 with phase one in South Florida, phase two in Los Angeles in May 2008, and phase three in Detroit in March 2009, the Strike Force has obtained indictments of more than 293 individuals and organizations that collectively have billed the Medicare program for more than $674 million. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
Each of the three Houston Strike Force teams is led by a federal prosecutor from the U.S. Attorney’s Office in Houston or the Criminal Division’s Fraud Section. Each team has an agent from the FBI, HHS-OIG and the Texas Attorney General’s MFCU. DEA, OPM-OIG and RRB-OIG also have agents on the teams.
The cases are being prosecuted by attorneys from the U.S. Attorney’s Office, including Assistant U.S. Attorney Jennifer Lowery and Special Assistant U.S. Attorney Justin Blan, on detail from HHS-OIG, as well as from the Criminal Division’s Fraud Section, including Assistant Chief John S. (Jay) Darden and Trial Attorneys Charles Reed, Katherine Houston, Anthony Burba and John Cunningham.
An indictment is merely an allegation, and defendants are presumed innocent until and unless proven guilty.
To learn more about the HEAT team, go to: www.hhs.gov/stopmedicarefraud
Federal Corrections Officer Convicted of Civil Rights Charges <br /> Related to Fatal AssaultRead the Press Release
A federal jury in Orlando, Fla, found Erin Sharma, a Bureau of Prisons corrections officer, guilty today on felony federal civil rights charges related to a fatal assault on an inmate in March 2005. Sharma was convicted on two charges, one count of conspiring to violate the federal civil rights of inmate Richard Delano, and a second count of violating Delano’s civil rights by arranging for another inmate to assault Delano. Each count carries a sentence of up to life imprisonment and a $250,000 fine. A sentencing hearing has been set for Oct. 26, 2009.
The evidence at trial showed that on Feb. 28, 2005, Sharma and a co-conspirator agreed to move Delano into the cell of another inmate at the Coleman Federal Correctional Complex in Coleman, Fla. The evidence also showed that Sharma and the co-conspirator knew that the inmate was likely to assault Delano, and that this move was in retaliation for a prior altercation between Delano and Sharma. Sharma also encouraged the inmate to assault Delano. The co-conspirator moved Delano into the inmate’s cell on March 1, 2005. On March 4, 2005, the inmate assaulted Delano. Delano later died from the injuries he suffered during that assault.
"This prosecution and the jury’s verdict makes clear that no one is above the law and the Department of Justice is committed to vigorously enforcing the criminal civil rights laws that the vast majority of law enforcement officers work tirelessly to uphold and enforce," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "Indeed, it is appalling that a federal corrections officer would engage in a scheme that resulted in the fatal beating of an inmate that she was sworn to protect."
The case was prosecuted by Assistant U.S. Attorneys Bruce Ambrose and Carolyn Adams from the U.S. Attorney’s Office, and Senior Litigation Counsel Gerard Hogan and Trial Attorney Douglas Kern from the Civil Rights Division of the U.S. Department of Justice. Federal Bureau of Investigation Special Agent Jim Raby was the lead investigator on the case.
Arizona Man Pleads Guilty to Mailing Child PornographyRead the Press Release
WASHINGTON – Robert Restuch, 69, of Bullhead City, Ariz., pleaded guilty yesterday to one count of mailing child pornography, Assistant Attorney General Lanny A. Breuer of the Criminal Division and U.S. Attorney for the District of Arizona Diane J. Humetewa announced.
As part of his plea agreement, Restuch admitted that he entered a U.S. Post Office in Bullhead City and mailed a package that contained more than 600 images of child pornography, including images depicting children less than 12 years old.
Sentencing has been set for Oct. 19, 2009. At sentencing, Restuch will face a mandatory minimum sentence of five years in prison and up to 20 years in prison, as well as the possibility of lifetime supervised release. He will also face a fine of up to $250,000.
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 Vincent Q. Kirby, Sharon K. Sexton and Heather Nelson of the District of Arizona. The U.S. Postal Inspection Service conducted the investigation.
Vice President Biden, Attorney General Holder Announce Recovery Act Funding <br /> to Support Law EnforcementRead the Press Release
Vice President Joe Biden and Attorney General Eric Holder today announced $1 billion in grants to fund the hiring and rehiring of law enforcement officers all across the country under the American Recovery and Reinvestment Act of 2009. The grants will be awarded to 1,046 law enforcement agencies from all 50 states and will provide 100 percent of the approved salary and benefits for 4,699 officers for three years. Police departments receiving the grants will then be required to retain the grant-funded positions for a fourth year. Associate Attorney General Tom Perrelli, Pennsylvania Governor Ed Rendell, New Jersey Governor Jon Corzine, Delaware Governor Jack Markell, Maryland Governor Martin O’Malley, Philadelphia Mayor Michael Nutter, Philadelphia Police Commissioner Charles Ramsey and law enforcement officers from mid-Atlantic states joined the Vice President and Attorney General at the event.
"A big part of the Recovery Act is about building communities – making them as strong as they can be, allowing every American family to live a better life than the one they are leading now," said Vice President Joe Biden. "And we can’t achieve the goal of stronger communities without supporting those who keep our streets safe."
The Recovery Act grants, which will be administered by the U.S. Department of Justice Office of Community Oriented Policing Services (COPS) through the federal agency’s COPS Hiring Recovery Program, provide much needed financial support to state, local and tribal governments, and will help the nation’s law enforcement agencies add and retain the manpower needed to fight crime more effectively through community policing. The Department of Justice received over 7,200 applications for more than 39,000 officer positions, representing a total of $8.3 billion in requested funding.
"These Recovery Act funds will pump much needed resources into communities through a program with a proven track record," said Attorney General Holder. "The tremendous demand for these grants is indicative of both the tough times our states, cities and tribes are facing, and the unyielding commitment by law enforcement to making our communities safer."
"Our sworn officers are the front line of defense against crime and disorder in our nation’s communities," said Philadelphia Police Commissioner Charles H. Ramsey. "These Recovery funds are essential in helping local law enforcement agencies fulfill their mission of making the places in which we all live and work as safe as possible."
The Recovery Act includes $4 billion in Department of Justice grant funding to enhance state, local, and tribal law enforcement efforts, including the hiring of new police officers, to combat violence against women, and to fight internet crimes against children. In addition to today’s COPS awards, to date the Department of Justice has awarded $1.7 billion through formula state and local Edward Byrne Memorial Justice Assistance Grants, $95 million through the Victims of Crime Act Formula Grant Program, $41.5 million for Internet Crimes Against Children initiatives, $127 million in Office on Violence Against Women Recovery Act funds and $8.6 million for assistance for law enforcement along the Southern Border and in high intensity drug trafficking areas.
For more information about the COPS grants, or to learn which law enforcement agencies received funding, please visit www.cops.usdoj.gov.
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Attorney General's Remarks
UBS Client Pleads Guilty to Filing False Tax Return, Hid $8 Million in Secret Swiss Bank AccountsRead the Press Release
WASHINGTON - Jeffrey P. Chernick, of Stanfordville, N.Y., pleaded guilty today to charges of filing a false tax return, the Justice Department and Internal Revenue Service (IRS) announced. Chernick, who owns a corporation which represents toy manufacturers in China and Hong Kong, appeared today before Judge James I. Cohn in Ft. Lauderdale, Fla., and accepted responsibility for concealing more than $8 million in Swiss bank accounts.
According to court documents and statements made in court, on or about Oct. 14, 2008, Chernick electronically filed a U.S. Individual Income Tax Return Form 1040 for tax year 2007, which failed to report that he had an interest in or a signature authority over a financial account at UBS AG, one of Switzerland’s largest bank. He also failed to report income earned on the UBS account. The UBS account was opened in the name of Simba International Ltd., a nominee Hong Kong corporation.
According to court documents, beginning in the mid-1970’s, the defendant set up a Hong Kong corporation and opened offshore bank accounts in order to conceal from the IRS commissions paid to the defendant for toy sales. In total, Chernick was the beneficial owner of approximately $8 million in offshore assets which were maintained in accounts in the name of nominee entities, including Simba, at UBS and other Swiss banks.
According to court documents, in 2000, UBS entered into an agreement to begin providing the IRS with certain information relating to accounts in which the beneficial owner was a U.S. citizen. Around the same time, one of Chernick’s Swiss bankers left UBS for a smaller, less known Swiss bank. This banker told Chernick he had left UBS, in part, because the smaller bank would not be subject to Washington’s scrutiny and could not be pressured by the U.S. government to disclose certain information to American authorities. Following this banker’s advice, Chernick agreed to invest some of his assets with the smaller Swiss bank.
According to court documents, from 2002 through 2008, Chernick discussed his offshore accounts with this former UBS banker and other Swiss financial service providers. These meetings took place in the United States at various locations, including hotels in New York City. During these meetings, Chernick, the Swiss bankers and Swiss financial service providers would discuss Chernick’s investments held in his offshore accounts, as well as the payment of fees for banking services rendered by Hong Kong and Swiss financial service providers. In July 2008, despite Chernick’s concerns about the ongoing investigation into the activities of UBS, a Swiss financial service provider convinced Chernick not to disclose his offshore accounts, not to file amended returns, and not to pay to the IRS any additional taxes that were due and owing.
According to court documents, in order to have access to the millions of dollars Chernick concealed offshore, he utilized credit cards linked to his offshore Swiss bank accounts which he used to make large purchases while traveling abroad. Additionally, with the assistance of Swiss bankers and other financial service providers, Chernick set up a sham $700,000 loan between Simba and a second Hong Kong entity in order to repatriate funds into the United States to purchase property adjacent to his home in New York.
"Americans who have concealed assets offshore have until September 23 to voluntarily come clean with the IRS and take advantage of the reduced penalties connected with the current offshore initiative," said John DiCicco, Acting Assistant Attorney General for the Tax Division. "Failure to come forward and to disclose offshore assets exposes these Americans to increased penalties and possible criminal prosecution."
Judge Cohn scheduled sentencing for Oct. 30, 2009. Chernick faces a maximum sentence of three years in prison.
"As the investigation into offshore tax evasion continues, the United States will continue to vigorously pursue new leads and evidence as they are uncovered," said Jeffrey H. Sloman, Acting U.S. Attorney for the Southern District of Florida. "Those who enable and commit tax evasion risk substantial monetary penalties and incarceration."
In February 2009, UBS entered into a deferred prosecution agreement in which the bank admitted helping U.S. taxpayers hide accounts from the IRS. As part of the agreement, UBS provided the U.S. government with the identities of, and account information for, certain U.S. customers of UBS’s cross-border business.
"This is an important victory for America’s taxpayers who play by the rules and have no tolerance for those who shirk their tax responsibilities. Today’s action is also part of a much larger and coordinated effort by the Administration to aggressively find and crack down on tax evaders hiding their wealth overseas. For those still hiding in this shadowy world, it is time to come in and get right with your government or face stiff criminal and financial penalties," said IRS Commissioner Doug Shulman.
In June 2009, UBS client Steven Michael Rubinstein, a Boca Raton accountant, pleaded guilty to filing a false tax return. In April 2009, another UBS client, Robert Moran, a Ft. Lauderdale yacht broker, pleaded guilty to filing a false tax return.
Acting Assistant Attorney General DiCicco and Acting U.S. Attorney Sloman commended the investigative efforts of the IRS agents involved in this case. The prosecution is being handled by Senior Litigation Counsel Kevin M. Downing and Trial Attorney Michael P. Ben’Ary of the Tax Division, and Assistant U.S. Attorney Jeffrey A. Neiman.
U.S. citizens who have an interest in, or signature or other authority over, a financial account in a foreign country with assets in excess of $10,000 are required to disclose the existence of such account on Schedule B, Part III of their individual income tax return. Additionally, United States citizens much file a Report of Foreign Bank and Financial Accounts, or F-Bar, with the United States Treasury, disclosing any financial account in a foreign country with assets in excess of $10,000 for which they have a financial interest in or signature authority, or other authority over.
More information about the Justice Department’s Tax Division and its enforcement efforts is available at http://www.usdoj.gov/tax/.
Texas Man Arrested and Charged in Child Pornography CaseRead the Press Release
WASHINGTON – Mark Edwin Cairnes, 51, of Jonestown, Texas, has been charged with advertising, receiving and possessing child pornography, Assistant Attorney General Lanny A. Breuer of the Criminal Division and Acting U.S. Attorney John E. Murphy for the Western District of Texas announced today.
A grand jury in the Western District of Texas returned the indictment against Cairnes on July 21, 2009, which was unsealed today after his arrest yesterday in Jonestown. Cairnes is charged with five counts of advertising child pornography, two counts of receiving child pornography and one count of possessing child pornography. If convicted, Cairnes faces a mandatory minimum of 15 years in prison and a maximum of 30 years in prison for each count of advertising child pornography; a mandatory minimum of five years in prison and a maximum of 20 years in prison for each count of receiving child pornography; and a maximum of 10 years in prison for possessing child pornography. He also faces the possibility of a lifetime term of supervised release, as well as a fine of up to $250,000. An indictment is merely a charge and defendants are presumed innocent until proven guilty.
Cairnes was identified through "Operation Joint Hammer" – the U.S. component of an ongoing global enforcement operation targeting transnational rings of child pornographers. The operation already has led to the arrest of more than 60 people in the United States involved in the trade of child pornography. Operation Joint Hammer was initiated through evidence developed by European law enforcement and shared with U.S. counterparts by Europol and Interpol. The European portion of this global enforcement effort, "Operation Koala," was launched after the discovery of a handful of people in Europe who were molesting children and producing photographs of that abuse for commercial gain. Further investigation unveiled a number of online child pornography rings. Law enforcement has determined that the customers of the Web site were located in nearly 30 countries around the world, including the United States.
The case is being prosecuted by Assistant U.S. Attorney Matthew B. Devlin of the Western District of Texas and Trial Attorney Alecia Riewerts Wolak of the Criminal Division’s Child Exploitation and Obscenity Section. The investigation is being handled by ICE.
Indictment
Justice Department Signs Agreement with the Village of Midlothian, Illinois, to Improve Civic Access for People with DisabilitiesRead the Press Release
WASHINGTON – The Justice Department today announced an agreement with the village of Midlothian, Ill., to improve access to civic life for persons with disabilities. The agreement was reached under the Department’s Project Civic Access initiative, which aims to bring state and local governments into full compliance with the Americans with Disabilities Act (ADA). This agreement is the 162nd under Project Civic Access.
"Access to public programs and services is a basic civil right, and I commend the village of Midlothian for committing to improving access to its programs and facilities for all of its citizens," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "As a result of today’s agreement, individuals with disabilities will be able to participate more fully in the civic life of Midlothian and to enjoy the access to services that so many of us take for granted."
More than 16 percent of the people living in the village of Midlothian have disabilities and will benefit from the agreement, which outlines several key steps the village of Midlothian will take to improve access for persons with disabilities, including:
- Making physical modifications to its facilities so that parking, routes into the buildings, entrances, public telephones, restrooms, service counters and drinking fountains are accessible to persons with disabilities;
- Ensuring that the village’s official Web site is accessible to persons with disabilities;
- Ensuring that all appropriate village employees are trained and practiced in using the Illinois Relay Service to make and receive calls;
- Maintaining the village’s database that tracks and aids the village in prioritizing repairs needed to eliminate sidewalk barriers to accessibility; and
- Ensuring equal access to its emergency management program and services for persons with disabilities.
Project Civic Access was initiated to ensure that persons with disabilities have an equal opportunity to participate in civic life. As part of the project, Department investigators, attorneys and architects conduct on-site surveys of state and local government facilities and programs across the country, and work to identify ways to improve a community’s compliance with ADA requirements. Each Project Civic Access agreement outlines a plan with specific steps that a local government will take to improve access for individuals with disabilities, while also acknowledging the steps already taken.
People interested in finding out more about the ADA, today’s agreement with the village of Midlothian or the Department’s Project Civic Access initiative may access the ADA Web site at http://www.ada.gov or call the toll-free ADA Information Line at (800) 514-0301 or (800) 514-0383 (TTY).
Justice Department Signs Agreement with Gregg County, Texas, to Improve Civic Access for People with DisabilitiesRead the Press Release
WASHINGTON – The Justice Department today announced an agreement with Gregg County, Texas, to improve access for persons with disabilities to its programs, services, activities and facilities. The agreement was reached under the Department’s Project Civic Access initiative, which helps bring localities into full compliance with the Americans with Disabilities Act (ADA). This agreement is the 163rd entered into under Project Civic Access.
"Because of Gregg County’s willingness to work cooperatively toward this agreement, individuals with disabilities will now have greater access to those programs, services and facilities that so many of us take for granted," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "Civic access is a civil right, and I applaud county officials for their commitment to improving access."
The Department’s Agreement with Gregg County provides that the county will:
- Make physical modifications to specified facilities so that parking, routes into the buildings, entrances, public telephones, restrooms, service counters and drinking fountains are accessible to persons with disabilities;
- Post, publish and distribute a notice to inform members of the public of the provisions of title II of the ADA and their applicability to the county’s programs, services and activities;
- Ensure that the county’s official Web site is accessible to persons with disabilities;
- Take steps to ensure that all appropriate employees are trained and practiced in using the Texas Relay Service to make and receive calls;
- Maintain the database that tracks and assists the county in prioritizing repairs necessary to eliminate barriers to accessibility in the county’s sidewalks;
- Develop a method for providing emergency management policies and procedures for persons with disabilities, including preparation, notification, response and clean up;
- Develop a method for providing information for interested persons with disabilities concerning the existence and location of the county’s accessible services, activities and programs;
- Install signs at any inaccessible entrance to a facility directing users to an accessible entrance or to information about other accessible facilities.
Project Civic Access was initiated to ensure that individuals with disabilities have an equal opportunity to participate in civic life in their communities. As part of the project, Department investigators, attorneys and architects conduct on-site surveys of state and local government facilities and programs to identify modifications needed for compliance with ADA requirements. The agreements are tailored for each community to address specific areas where access to a government’s programs or facilities can be improved.
People interested in finding out more about the ADA, today’s agreement with Gregg County or the Department’s Project Civic Access initiative may obtain this information on the ADA Web site at http://www.ada.gov or by calling the toll-free ADA Information Line at (800) 514-0301 or (800) 514-0383 (TDD).
Contracting Officer’s Niece Pleads Guilty to Obstructing Money Laundering Investigation Related to Bribe PaymentsRead the Press Release
WASHINGTON - The niece of a U.S. Army major pleaded guilty today for her role in a conspiracy to cover up her uncle’s role in accepting more than $9 million in bribes as a contracting officer in Kuwait, Assistant Attorney General Lanny A. Breuer of the Criminal Division and Assistant Attorney General Christine A. Varney of the Antitrust Division announced.
Nyree Pettaway, 37, of Houston, pleaded guilty in U.S. District Court for the Western District of Texas to one count of conspiring with her uncle, John C. Cockerham, Carolyn Blake (her aunt and Cockerham’s sister) and others, to obstruct the investigation of money laundering related to Cockerham’s receipt of bribes. Pettaway admitted that, as Cockerham learned that he was under investigation in late 2006, he solicited her assistance to create cover stories for the millions of dollars he had received and to return $3 million in cash to co-conspirators for safekeeping. Pettaway admitted she traveled to Kuwait, received the cash from Blake, and gave it to others to hold for Cockerham. Pettaway also admitted that she delivered fraudulent documents to contractors in Kuwait, attempting to make the bribe payments look to investigators like legitimate loans.
Pettaway faces up to five years in prison and a fine of $250,000. In addition, she agreed to pay $5 million in restitution to the United States.
Cockerham pleaded guilty in January 2008 to participating in the complex bribery and money-laundering scheme. According to court documents, he was responsible for awarding contracts for services to be delivered to troops in Iraq, including bottled water. In return for awarding illegal contracts, Cockerham admitted to receiving more than $9 million in bribe proceeds. Once Cockerham agreed to take money in exchange for awarding contracts, he admitted he directed the contractors to pay Blake, his wife Melissa Cockerham, and others in order to conceal the receipt of bribe payments.
Melissa Cockerham pleaded guilty in January 2008 to accepting more than $1 million on John Cockerham’s behalf, and admitted that she had stored the cash in safe deposit boxes at banks in Kuwait and Dubai.
Blake pleaded guilty in March 2009 to one count of money laundering conspiracy after accepting more than $3 million in bribe proceeds on behalf of John Cockerham. Blake admitted she had expected to keep 10 percent of the money she collected.
This case is being prosecuted by Trial Attorney Richard B. Evans of the Criminal Division’s Public Integrity Section, which is headed by Chief William M. Welch, II and Trial Attorneys Mark W. Pletcher and Emily W. Allen of the Antitrust Division’s National Criminal Enforcement Section, which is headed by Chief Lisa Phelan. The case is being investigated by the Army Criminal Investigations Division, the Defense Criminal Investigative Service, the FBI, the Internal Revenue Service, the Special Inspector General for Iraq Reconstruction, and the U.S. Immigration and Customs Enforcement at the Department of Homeland Security.
The National Procurement Fraud Task Force, 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.
Information
Virginia Resident Pleads Guilty to Participating in Scheme <br /> to Steal Fuel from U.S. Army in IraqRead the Press Release
A Virginia man pleaded guilty today to participating in a scheme to steal fuel worth approximately $39.6 million from the U.S. Army in Iraq.
Michel Jamil, 59, of Annandale, Va., pleaded guilty today in U.S. District Court in Alexandria, Va., before Judge Claude Hilton. Jamil pleaded guilty to a one-count information charging him with conspiracy to steal government property.
In his guilty plea, Jamil admitted that in March 2007, he and two of his co-conspirators arranged for the creation of a false Memorandum for Record (MFR) authorizing individuals to draw fuel from the Victory Bulk Fuel Point (VBFP), Camp Liberty, Iraq, purportedly on behalf of a company serving as a contractor to the U.S. government. The VBFP, owned and operated by the United States, supplies aviation and diesel fuel to military units and U.S. government contractors operating in and around the Victory Base Complex. Jamil admitted that he and his co-conspirators used this false MFR and others to steal large quantities of fuel from the U.S. Army for subsequent sale on the Iraqi black market. Jamil admitted that he escorted the trucks to retrieve fuel from the VBFP using a false MFR on approximately 10 to 15 occasions. During Jamil’s participation in the scheme, he and his co-conspirators stole from the U.S. Army fuel worth approximately $39.6 million. As a result of the scheme, Jamil admitted he received between $75,000 and $87,500 in profits.
At sentencing, Jamil faces a maximum sentence of five years in prison and a fine of the greater of $250,000 or twice the value gained or lost. Sentencing is scheduled for Nov. 13, 2009.
In related cases, Lee William Dubois and Robert Young pleaded guilty to participating in the same scheme. In his guilty plea on Oct. 7, 2008, Dubois admitted that he obtained government-issued common access cards for the drivers and escorts of the trucks and also presented false documents to the VBFP authorizing his co-conspirators to draw fuel. Dubois admitted that he and his co-conspirators stole approximately 10 million gallons of fuel, and that he received at least $450,000 in personal profits from the subsequent sale of the fuel on the black market. Sentencing for Dubois is scheduled for Sept. 4, 2009.
Young, 56, a former captain in the U.S. Army, pleaded guilty on July 24, 2009. In his guilty plea, Young admitted that between October 2007 and May 2008, he and his co-conspirators used fraudulently-obtained documents to enter the VBFP and presented false fuel authorization forms to steal aviation and diesel fuel from the VBFP for subsequent sale on the black market. As a result of the scheme, Young received approximately $1 million in personal profits. Sentencing for Young is scheduled for Oct. 30, 2009.
In another related case, a federal grand jury returned a superseding indictment on May 21, 2009, charging Robert Jeffery, 55, with conspiracy and theft of government property in connection with the same fuel theft scheme. The indictment alleges that Jeffery served as the lead escort for the fuel trucks for several months and illegally retrieved thousands of gallons of fuel from the VBFP. Young and Jeffery are both U.S. citizens who, until their arrests in connection with this case, resided in the Philippines. Jeffery’s trial is scheduled to begin on Aug. 10, 2009.
The case is being prosecuted by Special Assistant U.S. Attorney Steve Linick, Deputy Chief of the Criminal Division’s Fraud Section, and Fraud Section Trial Attorneys Andrew Gentin and Brigham Cannon. The investigation of this case was conducted by the U.S. Army Criminal Investigation Command, the Defense Criminal Investigative Service, the FBI and members of the National Procurement Fraud Task Force and the International Contract Corruption Task Force (ICCTF).
The National Procurement Fraud Task Force, 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, including in Afghanistan, Iraq and Kuwait.
Ship Operator Sentenced to Pay More Than $2 Million Fine for Concealing Pollution on the High SeasRead the Press Release
WASHINGTON—The operator of an ocean-going chemical tanker ship was sentenced today in federal court to pay a fine of more than $2 million for polluting the high seas, the Justice Department announced.
Consultores de Navegacion, a Spanish company that operates the M/T Nautilus, an ocean-going chemical tanker ship, was sentenced today by U.S. District Judge Douglas P. Woodlock to pay a fine of more than $2 million and serve three years of probation for criminal violations related to the overboard discharge of oil-contaminated bilge waste on the high seas.
The company pleaded guilty on April 6, 2009, to conspiracy, falsification of records, obstruction, and two violations of the Act to Prevent Pollution from Ships for failing to maintain an accurate oil record book. The practice of improperly handling and disposing of oil-contaminated waste from the tanker took place from at least June 2007 until March 2008. Along with the $2.08 million fine, the court ordered the company to implement comprehensive environmental compliance plan to prevent future violations.
Engine room operations on board large oceangoing vessels such as the M/T Nautilus generate large amounts of waste oil and oil-contaminated bilge waste. International and U.S. law prohibit the discharge of waste containing more than 15 parts per million of oil and without treatment by an oily water separator—a required pollution prevention device. Federal law also requires ships to accurately record each disposal of oil-contaminated bilge water in an oil record book and to have the oil record book available for inspection by the U.S. Coast Guard within the internal waters of the United States.
According to the government, between June 2007 and March 2008, senior engineers on the M/T Nautilus directed subordinate engine room crew members to use a metal pipe to bypass the ship’s oil water separator and instead to discharge oil-contaminated waste directly overboard. On two occasions in August 2007, Vadym Tumakov, a Ukranian who at that time served as chief engineer of the M/T Nautilus, directed the discharge of pollution overboard. In addition, in February 2008, Carmelo Oria, a Spanish citizen who served as chief engineer at that time, directed a discharge directly overboard from the ship’s bilge wells.
Oria, who was the chief engineer on the M/T Nautilus between January and March 2008 pleaded guilty to maintaining an oil record book that concealed the improper discharge of untreated waste directly from the ship’s bilges and was sentenced on May 6, 2009 to serve one month in prison. Vadym Tumakov, who was the chief engineer on the M/T Nautilus in August 2007 pleaded guilty to using falsified records that concealed improper discharges of oil-contaminated bilge waste from the ship and was sentenced on April 13, 2009 to serve one week in prison and a fine of $2,000.
The government’s investigation began in March 2008, when inspectors from the U.S. Coast Guard conducted an examination of the M/T Nautilus, following the ship’s arrival in St. Croix, U.S. Virgin Islands, and subsequently in the Port of Boston. The inspections uncovered evidence that crewmembers aboard the ship had improperly handled and disposed of the ship’s oil-contaminated bilge water and falsified entries in the ship’s official oil record book to conceal these activities.
"Today’s criminal fine is another warning to corporate entities and crewmembers that deliberately bypassing required environmental controls and pumping untreated bilge water directly into the ocean is illegal and violators will be punished," said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. "As long as individuals and maritime companies ignore this nation’s environmental laws, the Justice Department will continue to bring cases and seek justice for those involved."
"Today’s sentence should send a strong message to anyone in the maritime community who might consider circumventing our nation’s anti-pollution laws. Violating our nation’s environmental laws can actually cost more than legally disposing of the waste," said Acting U.S. Attorney Michael K. Loucks, for the District of Massachusetts.
"The Coast Guard remains committed to working with the maritime industry and federal, state and local law enforcement partners to protect the environmental resources of our nation," said Rear Admiral Joseph Nimmich, Commander of the First Coast Guard District in Boston. "Holding violators of the law responsible is critical to our enforcement effort. This case is a victory for the country and the environment."
The case was investigated by the U.S. Coast Guard, Coast Guard Investigative Service. It was prosecuted by Assistant U.S. Attorney Linda M. Ricci of the U.S. Attorney’s Economic Crimes Unit, Trial Attorney Todd Mikolop of the Justice Department’s Environmental Crimes Section, and Special Assistant U.S. Attorney Christopher Jones of the U.S. Coast Guard First District Legal Office.
Seven Charged with Terrorism Violations in North CarolinaRead the Press Release
Seven individuals have been charged with conspiring to provide material support to terrorists and conspiring to murder, kidnap, maim and injure persons abroad.
On Wednesday, July 22, 2009, a federal grand jury in the Eastern District of North Carolina returned a sealed seven-count indictment against the following defendants:
- Daniel Patrick Boyd, 39, a U.S. citizen and resident of North Carolina
- Hysen Sherifi, 24, a native of Kosovo and a U.S. legal permanent resident located in North Carolina
- Anes Subasic, 33, a naturalized U.S. citizen and resident of North Carolina
- Zakariya Boyd, 20, a U.S. citizen and resident of North Carolina
- Dylan Boyd, 22, a U.S. citizen and resident of North Carolina
- Mohammad Omar Aly Hassan, 22, a U.S. citizen and resident of North Carolina
- Ziyad Yaghi, 21, a U.S. citizen and resident of North Carolina
All the defendants are charged with conspiracy to provide material support to terrorists, as well as conspiracy to murder, kidnap, maim and injure persons abroad. In addition, Daniel Boyd, Hysen Sherifi and Zakariya Boyd are each charged with possession of a firearm in furtherance of a crime of violence. Daniel Boyd and Dylan Boyd are also each charged with selling a firearm to a convicted felon. Finally, Daniel Boyd is also charged with receiving a firearm through interstate commerce and two counts of making false statements in a terrorism investigation.
The defendants were arrested at various locations this morning by the FBI and other law enforcement agencies. They made their initial appearances today in federal court in Raleigh, N.C. At that time, the indictment was unsealed.
"The indictment alleges that Daniel Boyd is a veteran of terrorist training camps in Pakistan and Afghanistan who, over the past three years, has conspired with others in this country to recruit and help young men travel overseas in order to kill. Given the weapons allegedly involved in this conspiracy and the seriousness of the charges, the many agents, analysts and prosecutors who were able to bring about this case and safely remove these defendants from our streets deserve special thanks," said David Kris, Assistant Attorney General for the National Security Division.
"These charges hammer home the point that terrorists and their supporters are not confined to the remote regions of some far away land but can grow and fester right here at home. Terrorists and their supporters are relentless and constant in their efforts to hurt and kill innocent people across the globe. We must be equally relentless and constant in our efforts to stop them," said U.S. Attorney George E.B. Holding.
"The threat that extremists and radicals pose to America and our allies has not dulled or gone away. These arrests today show there are people living among us, in our communities in North Carolina and around the US, that are honing their skills to carry out acts of murder and mayhem. Their ultimate goal is to wage war on freedom and democracy. The FBI and our law enforcement partners are doing all we can to stop them from thriving and successfully attacking again," said Owen D. Harris, Special Agent in Charge of the Charlotte Division of the FBI. "We will remain vigilant, so must the public. If you see or hear something - act - call your local police department or the FBI. September 11th is not a vague memory for us, nor should it be for anyone."
"The cooperation between federal, state and local authorities throughout this investigation has been outstanding. It is only with our ongoing law enforcement partnership through the Joint Terrorism Task Force in conjunction with North Carolina’s fusion center, ISAAC, that we are able to ensure public safety from these terrorist threats," said North Carolina State Bureau of Investigation Director Robin P. Pendergraft.
The Conspiracy
According to the indictment, during the period from 1989 through 1992, Daniel Boyd traveled to Pakistan and Afghanistan where he received military-style training in terrorist training camps for the purpose of engaging in violent jihad. Following this training, he allegedly fought in Afghanistan.
From roughly November 2006 through at least July 2009, the indictment alleges that Daniel Boyd and the other defendants conspired to provide material support and resources to terrorists, including currency, training, transportation and personnel. The defendants also conspired to murder, kidnap, maim and injure persons abroad during this period. The object of the conspiracy, according to the indictment, was to advance violent jihad, including supporting and participating in terrorist activities abroad and committing acts of murder, kidnapping or maiming persons abroad.
The indictment alleges that, as part of the conspiracy, the defendants prepared themselves to engage in violent jihad and were willing to die as martyrs. They also allegedly offered training in weapons and financing, and helped arrange overseas travel and contacts so others could wage violent jihad overseas.
As part of the conspiracy, the indictment further alleges that the defendants raised money to support training efforts, disguised the destination of such monies from the donors, and obtained assault weapons to develop skills with the weapons. Some defendants also allegedly radicalized others to believe that violent jihad was a personal religious obligation.
Recruitment and Travels
Among other acts, the indictment alleges that Daniel Boyd traveled to Gaza in March 2006 and attempted to enter Palestine in order to introduce his son to individuals who also believed that violent jihad was a personal religious obligation. Later, in October 2006, defendant Ziyad Yaghi allegedly departed the United States for Jordan to engage in violent jihad.
In June 2007, Daniel Boyd and several other defendants departed the United States for Israel in an effort to engage in violent jihad, but ultimately returned to the United States after failing in their efforts. According to the indictment, after his return to the United States, Daniel Boyd made false statements twice to federal officials about who he had planned to meet on his trip to Israel.
In February 2008, Daniel Boyd allegedly solicited money to fund the travel of additional individuals overseas to engage in violent jihad and in March 2008, discussed with Anes Subasic preparations to send two individuals abroad for this purpose. He allegedly accepted $500 in cash from defendant Hysen Sherifi to be used to help fund jihad overseas and later showed Sherifi how to operate an AK-47 assault weapon.
In July 2008, Sharifi allegedly departed the United States for Kosovo to engage in violent jihad. According to the indictment, Sharifi later returned to North Carolina in April 2009, for the purpose of soliciting funds and personnel to support the mujihadeen.
Weapons and Training
The indictment also alleges that Daniel Boyd obtained a variety of weapons in furtherance of the conspiracy to murder persons overseas and provide material support to terrorists. These included a Bushmaster M4A3 rifle that Boyd allegedly received illegally via interstate commerce in 2006, as well as an ETA M16 V System C-MAG that he purchased in 2006. In 2007, he allegedly purchased a Ruger mini 14 long gun.
During 2008, the indictment alleges that Boyd purchased a Mossburg 100 ATR .270 rifle, a Llama Camanche III .357 revolver, a Century Arms AK Sporter 7.62 X 39 rifle and a Ruger mini 30 7.62 X 39 rifle. During 2009, Boyd allegedly purchased a Ishmash SAGA .308 rifle, a Century Arms Polish Tantal 5.45 X 39 rifle, a Century Arms C91 rifle .308, a Century Arms M70B1 7.62 X 34 rifle, a Ruger mini 14 5.56 rifle, and a Smith & Wesson MP15 .223 rifle.
The indictment further alleges that in February 2009, Daniel Boyd and his son, Dylan Boyd, knowingly sold a Beretta 9 mm handgun and ammunition to a convicted felon. In addition, the indictment alleges that in June 2009, Daniel Boyd and his son, Zakariya Boyd, used firearms in furtherance of a crime of violence, specifically conspiracy to murder.
Finally, the indictment alleges that Daniel Boyd and several of the defendants practiced military tactics and the use of weapons on private property in Caswell County, N.C., in June and July 2009.
Each of the defendants faces potential life imprisonment if convicted of conspiracy to murder, kidnap, maim and injure persons abroad. In addition, conspiracy to provide material support to terrorists carries a maximum 15 year sentence. The charges of receiving a firearm through interstate commerce and selling a firearm to a convicted felon each carry a maximum 10 year sentence. Making false statements in a terrorism investigation carries a maximum 8 year sentence, while possession of a firearm in furtherance of a crime of violence carries a consecutive 5 year sentence.
This investigation is being conducted by the Raleigh Joint Terrorism Task Force of the Charlotte Division of the FBI and NCISAAC, the North Carolina Information Sharing and Analysis Center.
The prosecution is being handled by Assistant U.S. Attorneys Barbara D. Kocher and Jason Cowley of the U.S. Attorney’s Office for the Eastern District of North Carolina, and Trial Attorney Jason Kellhofer, of the Counterterrorism Section in the Justice Department’s National Security Division.
The public is reminded that an indictment contains mere allegations. Defendants are presumed innocent unless and until proven guilty in a court of law.
Father and Son Commercial Fishermen Plead Guilty to Illegal Harvesting of RockfishRead the Press Release
WASHINGTON—A father and son pleaded guilty today in U.S. District Court in Greenbelt, Md., to illegally over fishing striped bass, also known as rockfish, from 2003 through 2006, the Justice Department announced.
Joseph Peter Nelson Jr., a commercial fisherman licensed in Maryland, pleaded guilty to four felony violations of the Lacey Act for participating in a scheme to illegally over harvest and under report the amount of rockfish he took from the Potomac River. His father, Joseph Peter Nelson Sr., also pleaded guilty to one felony violation of the Lacey Act for assisting in transporting the illegally taken rockfish in interstate commerce.
"This concerted law enforcement initiative has revealed extensive illegal activity related to harvesting and reporting of rockfish," said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. "The Justice Department is working with federal, state and local law enforcement agencies to investigate and prosecute these crimes to ensure a healthy, sustainable population of striped bass, up and down the eastern seaboard."
"The defendants knowingly violated the law and took steps to conceal their crimes," said Rod J. Rosenstein, U. S. Attorney for the District of Maryland.
According to the statement of facts filed with the court, from 2003 to 2006, Nelson Jr., with the assistance of his father, and a Maryland designated check-in station named Golden Eye Seafood, operated by Robert Lumpkins, inflated the number of fish recorded and under reported the weight. By inflating the number of fish caught and under reporting the weight, the records made it appear that Nelson Jr., had not reached the poundage quota for the year. He then requested more tags from the state of Maryland in order to catch more fish above his quota which were never reported by Golden Eye Seafood and were transported to other states for sale.
In addition, Nelson Jr. admitted to catching rockfish that were below the legal size limit in Maryland, and using tags that falsely indicated the method of catch. The tags indicated that he had caught the fish using hook and line when in fact they were caught using a net. Nelson admitted that he used a knife to simulate hook marks on the fish in order to avoid detection. On eight different occasions Nelson Jr. with the assistance of his father sold a total of over 2500 pounds of illegally harvested and tagged fish to an undercover agent posing as an out of state fish buyer. Nelson Jr. also admitted that he falsely and selectively tagged the rockfish in order to conceal where the fish had been caught in order to illegally maximize his catch.
According to the statement of facts, the total amount of rockfish over harvested by Nelson was approximately 14,500 pounds, in addition to the rockfish that was falsely tagged. The total market value of the Nelson’s over-harvest of rockfish was in excess of $72,000.
On June 11, 2009, Golden Eye Seafood and its owner, Robert Lumpkins of St. Mary’s County, Md., pleaded guilty to violating and conspiracy to violate the Lacey Act, by falsely recording the amount and weight of rockfish that were harvested by local fisherman and checked-in through Golden Eye from 2003 to 2007. Lumpkins and Golden Eye are set to be sentenced on Sept. 22 and 23, 2009.
A total of 14 individuals and two corporations have been convicted of illegally harvesting, purchasing and selling rockfish in Maryland, Virginia and Washington, D.C., as a result of this investigation. Eight individuals and one corporation have been sentenced, and 6 individuals and one corporation are awaiting sentencing.
Sentencing has been set for both Nelsons for Oct. 22, 2009 at 9:30 A.M in U.S. District Court in Greenbelt, Md.
The case is being prosecuted by Assistant U.S. Attorneys Stacy Dawson Belf and Christen Sproule for the District of Maryland and Senior Trial Attorney Wayne Hettenbach of the Justice Department’s Environmental Crimes Section.
Used Motor Vehicle Dealers Indicted by Federal Grand Jury<br /> in Casper, Wyoming for Odometer TamperingRead the Press Release
WASHINGTON – A federal grand jury in Casper, Wyo., Thursday returned an indictment charging Randy Lee (a/k/a Jimmy Lee) and Jay Lee (a/k/a John Marks, a/k/a Anthony Romero) of Cheyenne, Wyo., with odometer tampering, title fraud, securities fraud, mail fraud and conspiracy to commit these offenses. The indictment alleges that the defendants worked as used car dealers at Lee’s RV’s, Inc., a dealership in Cheyenne. According to the indictment, as early as 2002, and through at least 2006, the defendants devised a scheme to defraud buyers of used motor vehicles by misrepresenting the mileage of vehicles they sold.
As part of the scheme, the indictment charges that the Lees purchased high-mileage, used motor vehicles from various businesses in New Mexico and Wyoming, as well as from a wholesale motor vehicle auction in Loveland, Colo. The defendants are charged with altering the odometers in these vehicles to reflect false, lower mileage. The Lees then fraudulently altered the motor vehicle titles and sales documentation associated with the these vehicles to reflect the false, lower mileage. As a result, the state of Wyoming issued motor vehicle titles reflecting this false, lower mileage, which the Lees knew to be untrue.
The defendants subsequently sold the motor vehicles to local consumers, other used motor vehicle dealers and at wholesale auto auctions, sometimes without stating that the false, lower mileages were inaccurate. As a result, the Lees received higher sales prices for the vehicles they sold, the indictment alleges.
"It is a crime for individuals who buy and sell used vehicles to change the odometers on the cars to increase their value," said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice. "People who buy used vehicles need accurate mileage information to assess the value and safety of the vehicle. We take seriously our obligation to prosecute those who violate these statutes."
According to the indictment, some of the vehicles were sold with false, low mileage written on the title, but with a notice that the odometer reading was not accurate. The indictment adds that the defendants did not reveal the true mileage of the vehicle, which could be more than 100,000 miles more than what the title indicated.
"Car dealers who take miles off of vehicles cannot escape prosecution by checking a box on the back of the title," said Kelly H. Rankin, U.S. Attorney for the District of Wyoming. "That sort of practice leaves consumers in the dark about the real mileage of the vehicle. The purpose of the law is to provide accurate information, and the exception in the statute for vehicles with unknown mileage does not create a loophole for unscrupulous dealers who roll back odometers and conceal the true mileage."
The charges in the indictment are only allegations, and the defendants are presumed innocent unless and until proven guilty. If convicted, each defendant faces up to 20 years in prison on the most serious of the charges.
Assistant Attorney General West thanked the Wyoming Department of Transportation, the U.S. Department of Transportation, National Highway Traffic Safety Administration and the U.S. Attorney’s Office in Wyoming for their assistance in investigating and prosecuting this case.
Statement by Attorney General Eric Holder on the 19th Anniversary of the Americans with Disabilities ActRead the Press Release
“ The signing of the Americans with Disabilities Act (ADA) 19 years ago was a watershed moment for persons with disabilities and for all Americans concerned with the cause of equal justice. In the nearly two decades that have followed, the ADA has empowered Americans with disabilities to fully pursue the civic and economic opportunities to which they are entitled.
As steward of the ADA, the Department of Justice is committed to actively enforcing this critical civil rights law and will use all tools to seek compliance – including litigation if necessary – so that its promise of full equality for Americans with disabilities can finally be realized. We are full partners in President Obama’s designated “Year of Community Living” and will vigorously enforce the Supreme Court’s Olmstead decision to end unnecessary institutionalization.
It is fitting that the President will mark this anniversary by signing the Convention on the Rights of Persons with Disabilities, a treaty inspired by the ADA that will incorporate principles of empowerment and integration into international law. Just as America’s leadership 19 years ago inspired the world to join the cause, our renewed commitment to promoting and enforcing our laws today will continue to bring us closer to the goal of true equality for all.”
New Jersey Man Charged with Obscenity ViolationsRead the Press Release
A Jersey City, N.J., producer has been charged by a federal grand jury in Newark, N.J. with distributing obscene DVDs through the mails.
Barry Goldman, 58, was charged with eight counts of using the mails to deliver DVDs containing allegedly obscene films from Jersey City to addresses in Montana and Virginia. The indictment seeks forfeiture of the proceeds from the sale of the DVDs, along with property used in producing the DVDs, all web sites operated by Goldman and other property.
If convicted, Goldman faces a maximum penalty of five years in prison and a fine of $250,000 on each of the eight counts charged in the indictment.
An indictment is merely an accusation. All defendants are presumed innocent of the charges and it is the government’s burden to prove a defendant’s guilt beyond a reasonable doubt at trial.
The case is being prosecuted by Trial Attorney Bonnie Hannan of the Criminal Division’s Obscenity Prosecution Task Force.
Investigation of the case was conducted by the FBI’s Adult Obscenity Squad based in the Washington, D.C. Field Office.
Former Military Officer Pleads Guilty to Participating in Scheme to Steal Fuel Worth $39.6 Million from U.S. Army in IraqRead the Press Release
Robert Young, 56, a former captain in the U.S. Army, pleaded guilty today to participating in a scheme to steal fuel worth approximately $39.6 million from the U.S. Army in Iraq.
Young, a U.S. citizen who resided in the Philippines until his arrest in connection with this case, entered his guilty plea today in U.S. District Court in Alexandria, Va., before Judge Claude Hilton. Young pleaded guilty to both counts of a two-count superseding indictment filed on May 21, 2009, charging him and Robert Jeffery with conspiracy and theft of government property. Young’s sentencing is scheduled for Oct. 30, 2009.
In his plea, Young admitted that in October 2007, he and other co-conspirators agreed to participate in a scheme to steal fuel from the U.S. Army. Young also admitted that between October 2007 and May 2008, he and his co-conspirators, purportedly representing Department of Defense contractors in Iraq, used fraudulently-obtained documents to enter the Victory Bulk Fuel Point (VBFP) in Camp Liberty, Iraq, and presented false fuel authorization forms to steal aviation and diesel fuel from the VBFP for subsequent sale on the black market. The United States owns and operates the VBFP in support of Operation Iraqi Freedom. The VBFP supplies fuel to both military units and U.S. government contractors operating in and around the Victory Base Complex. To retrieve and transport the stolen fuel from the VBFP, Young admitted that he and his co-conspirators employed several individuals to serve as drivers and escorts of the trucks containing the stolen fuel.
During Young’s participation in the scheme, he and his co-conspirators stole from the U.S. Army fuel worth approximately $39.6 million. As a result of the scheme, Young received approximately $1 million in personal profits.
At sentencing, Young faces a maximum sentence of 15 years in prison and a fine of the greater of $250,000 or twice the value gained or lost.
In a related case, Lee William Dubois pleaded guilty on Oct. 7, 2008, to participating in the same scheme. In his plea, Dubois admitted that he obtained government-issued common access cards for the drivers and escorts of the trucks and also presented false documents to the VBFP authorizing his co-conspirators to draw fuel. Dubois admitted that he and his co-conspirators stole approximately 10 million gallons of fuel, and that Dubois received at least $450,000 in personal profits from the subsequent sale of the fuel on the black market. Sentencing for Dubois is scheduled for Sept. 4, 2009.
The superseding indictment filed on May 21, 2009, charges Robert Jeffery, 55, a former master chief petty officer in the U.S. Navy, with conspiracy and theft of government property in connection with the same fuel theft scheme. The indictment alleges that Jeffery served as the lead escort for the fuel trucks for several months and illegally retrieved thousands of gallons of fuel from the VBFP. Jeffery is a U.S. citizen who, until his arrest in connection with this case, resided in the Philippines. Jeffery’s trial is scheduled to begin Aug. 10, 2009.
The case is being prosecuted by Special Assistant U.S. Attorney Steve Linick, Deputy Chief of the Criminal Division’s Fraud Section, and Fraud Section Trial Attorneys Andrew Gentin and Brigham Cannon. The investigation of this case was conducted by the U.S. Army Criminal Investigation Command, the Defense Criminal Investigative Service, the FBI and members of the National Procurement Fraud Task Force and the International Contract Corruption Task Force (ICCTF).
The National Procurement Fraud Task Force, 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, including in Afghanistan, Iraq and Kuwait.
Statement of Facts
Two Idaho Men Convicted for Federal Hate Crime AssaultRead the Press Release
WASHINGTON – Michael Bullard and Richard Armstrong were convicted yesterday by a jury in Boise, Idaho, on federal hate crime and conspiracy charges in connection with the racially-motivated assault of an African American man outside of a Wal-Mart store in July 2008, announced Loretta King, Acting Assistant Attorney General of the Civil Rights Division; Thomas E. Moss, U.S. Attorney for the District of Idaho; Timothy Fuhrman, Special Agent in Charge of the FBI’s Salt Lake City Field Office; and Bill Augsburger, Chief of the Nampa Police Department.
Bullard and Armstrong each face a maximum sentence of 20 years in prison. Sentencing is scheduled for Oct.19, 2009. A third defendant, James Whitewater, pleaded guilty before trial and testified against the other two defendants.
Evidence revealed that on July 4, 2008, three men using racial slurs ambushed, chased and beat a 24-year-old African American man as he walked out of a Wal-Mart store in Nampa, Idaho. Witnesses testified that Bullard, Armstrong and Whitewater all participated in the assault, while a fourth person, a girlfriend of one of the defendants, held their belongings and cheered them on. The girlfriend, Jennifer Hartpence, was initially charged as a co-defendant, but her case was dismissed before it reached the jury.
After four hours of deliberation, the jury convicted the two remaining defendants of conspiring to violate the federally-protected rights of the victim and of actually violating the victim’s protected rights by engaging in the racially-motivated assault.
"Driven by bigotry and prejudice, the defendants brutally assaulted a young man for no other reason than the color of his skin. Hate crimes have no place in America, and we are pleased that a jury of their peers has brought the defendants to justice," said Assistant Attorney General King. "The Civil Rights Division will continue to vigorously prosecute those who commit these heinous crimes to the full extent the law allows."
"These convictions mean that racial crimes will not be tolerated, not in this country, not on any day. Idaho, like most other parts of this nation, has had inglorious moments in its past when people endured oppression and criminal acts merely because of their skin color, race, national origin, gender or religion. We are long past that time," said U.S. Attorney Moss. "We thank the FBI and the Nampa Police Department for their outstanding work in bringing this case forward."
"One cannot help but note the irony of how these terrible acts occurred on the 4th of July," said Special Agent in Charge Fuhrman. "In this day and age, law enforcement will not tolerate hate crimes. The FBI is committed to investigating these incidents aggressively and without hesitation."
"The victim of these crimes was minding his own business, shopping in a store in our city open to the public – as all of us do, and have a right to do, every day. This man paid a high price, an example to all that we must protect our rights with courage and be vigilant in defending the rights of our fellow citizens," said Chief Augsburger.
This case was investigated by FBI Special Agent Dominic Venturi and Nampa Police Department Detective Jason Kimball. It was prosecuted by Assistant U.S. Attorney Wendy Olson and Civil Rights Division Trial Attorney Erin Aslan.
Two Cincinnati Dentists Charged with Conspiracy, Tax CrimesRead the Press Release
WASHINGTON - Bradley C. Brennecke, a resident of Pleasant Plain, Ohio, and Bruce A. Mrusek, a resident of Maineville, Ohio, appeared in federal court today before U.S. Magistrate Judge Timothy S. Hogan in Cincinnati on conspiracy and various tax charges, the Justice Department and Internal Revenue Service (IRS) announced. Mrusek and Brennecke, who are both dentists, were indicted yesterday by a federal grand jury and charged with tax evasion, conspiracy to defraud the IRS and passing fictitious instruments. Mrusek was also charged with filing false business tax returns.
According to the indictment, Brennecke, who operated Eastgate Dental Care Inc. in Cincinnati and Goshen Family Dentistry Ltd. in Goshen, Ohio, failed to pay taxes for 1998, 2002, 2003 and 2004. Additionally, the indictment alleges that Brennecke transferred title of his house to his wife to conceal it from the IRS, sent the government bogus documents that purported to pay his tax liabilities and filed false tax returns.
According to the indictment, Mrusek, who owned and operated Wilmington Dental Management Services in Wilmington, Ohio, evaded his 2002, 2003 and 2004 taxes by transferring his assets to his wife’s name, sending bogus documents to the IRS that purported to pay his tax liabilities, using a trust to pay personal expenses and filing false personal tax returns. Additionally, the indictment alleges that Mrusek filed false tax returns for Wilmington Dental Management Services by reporting deductions that the business did not incur.
According to the indictment, Brennecke and Mrusek conspired to defraud the IRS beginning around the time that the IRS began civil audits of each of them. Brennecke and Mrusek assisted each other in the mailing of various fraudulent documents to the IRS and U.S. Treasury Department. Brennecke assisted Mrusek in the transfer of assets out of Mrusek’s name. Additionally, Brennecke and Mrusek are charged with submitting fictitious obligations labeled "Secured Promissory Notes" to the U.S. Department of the Treasury as purported payment of their tax debts. Each of these documents purported to be in the amount of $4.8 billion.
An arraignment date has not yet been set. If convicted on all counts, Brennecke faces a maximum term of 75 years in prison and a maximum fine of $1.75 million. Mrusek, if convicted on all counts, faces a maximum term of 79 years in prison and a maximum fine of $2.25 million.
The case is being prosecuted by Tax Division trial attorneys Shawn T. Noud and Daren H. Firestone. The case was investigated by the IRS Criminal Investigation Division.
Additional information about the Justice Department’s Tax Division and its enforcement efforts may be found at http://www.usdoj.gov/tax.
Indiana Man Convicted of Transporting and Possessing Child PornographyRead the Press Release
WASHINGTON – William Travis Brown, 39, of Sellersburg, Ind., was convicted today by a federal jury in Indianapolis of transporting and possessing child pornography, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division, U.S. Attorney for the Southern District of Indiana Timothy M. Morrison, and Indianapolis Immigration and Customs Enforcement (ICE) Resident Agent in Charge Daniel T. Dill.
Brown was charged on July 8, 2009, in an amended indictment with one count of transportation and one count of possession of child pornography. According to evidence presented during the four-day trial, investigators discovered more than one thousand images and videos depicting the sexual abuse of minors. The images and videos were obtained through searches on March 20, 2007, of Brown’s rented house in Georgetown, Ind., and the seizure of a computer and CDs. In addition, evidence introduced at trial revealed that Brown used different Internet technologies to chat and trade the images with others online. Brown was tried before U.S. District Court Chief Judge David F. Hamilton.
At sentencing, Brown faces a mandatory minimum sentence of five years in prison, a maximum lifetime term of supervised release and a fine up to $250,000. A sentencing date has not yet been scheduled.
The case against Brown is being prosecuted by Assistant U.S. Attorney Steven D. DeBrota of the Southern District of Indiana and Trial Attorney Bonnie L. Kane of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS). The case was investigated by ICE, Indiana State Police, CEOS’s High Tech Investigative Unit and the FBI.
Colorado Interstate Gas Agrees to Resolve Clean Air Act Violations in UtahRead the Press Release
WASHINGTON— Colorado Interstate Gas Company (CIG), the operator of the Natural Buttes Compressor Station located on the Uintah and Ouray Indian Reservation near Vernal, Utah, has agreed to pay more than $1 million and install environmental controls at its facility as part of a consent decree that resolves violations of the Clean Air Act, the Justice Department and U.S. Environmental Protection Agency (EPA) announced today.
Under the terms of the decree, CIG will pay a civil penalty and back fees totaling $1,020,000 and will fund for one year the operation of two ambient air monitoring stations on the Uintah and Ouray Reservations
According to a complaint filed along with the consent decree, CIG installed engines at its Natural Buttes Compressor Station but failed to obtain a permit and control and test emissions sources at its facility on the reservation. The violations of the Clean Air Act were discovered through EPA inspections and EPA-required emission testing at the facility.
"Protecting the environment on Indian lands is an important priority for the Justice Department," said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. "This is the fourth Clean Air Act case this year alone, brought by the Department against companies operating natural gas production facilities on the Uintah and Ouray Indian Reservation."
"This settlement will formalize Colorado Interstate Gas Company’s commitment to reduce emissions and support air monitoring on the Uintah and Ouray Indian Reservation." said Eddie A. Sierra, Acting Assistant Regional Administrator for EPA Region 8.
The settlement will result in operational improvements that are expected to reduce emissions of hazardous air pollutants by more than 48,000 pounds per year and nitrogen oxides by 313,000 pounds per year. In addition, the settlement will help ensure that the Tribal air shed, a part of the atmosphere that behaves in a coherent way with respect to the dispersion of emissions, is being properly protected.
The consent decree, lodged today in the U.S. District Court for the District of Utah, 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 Department of Justice Web site at http://www.usdoj.gov/enrd/Consent_Decrees.html.
St. Louis Woman Sentenced to 20 Years in Prison on Federal Sex Trafficking ChargeRead the Press Release
WASHINGTON – A federal judge today sentenced Waquita Wallace to 20 years in prison and five years of supervised release for a federal civil rights charge of sex trafficking by force, fraud or coercion for compelling a young St. Louis woman to commit acts of prostitution, announced Acting Assistant Attorney General Loretta King for the Civil Rights Division and Acting U.S. Attorney Michael W. Reap for the Eastern District of Missouri.
U.S. District Court Judge Carol E. Jackson sentenced Wallace, who had previously pleaded guilty and is the last of three defendants in this case to be sentenced on sex trafficking related charges. April Chaney and Richard Harper were previously sentenced to 60 months and 27 months in prison respectively for their roles in this crime.
"Sex trafficking violates individuals’ basic human rights, stripping them of their dignity and freedom," Acting Assistant Attorney General King said. "The damage done to the victim in this case cannot be reversed, but I applaud the investigators and attorneys who brought these defendants to justice and it should send a message that we will continue to vigorously enforce our nation’s civil rights laws."
In announcing the plea, Acting Assistant Attorney General King, and Acting U.S. Attorney Reap commended the FBI and the St. Louis Metro Police Department for their work in this cooperative investigation and prosecution. Assistant U.S. Attorney Howard Marcus and Trial Attorney Jim Felte of the Civil Rights Division’s Human Trafficking Prosecution Unit prosecuted this case for the government.
East St. Louis Police Department Officer Indicted on Civil Rights and False Statement ChargesRead the Press Release
WASHINGTON – Antonio McWherter, a police officer in the East St. Louis, Ill., Police Department, was charged today in a two-count federal indictment stemming from a January 2006 incident in which the officer allegedly punched a handcuffed arrestee in the mouth, announced Loretta King, Acting Assistant Attorney General for the Civil Rights Division, and A. Courtney Cox, U.S. Attorney for the Southern District of Illinois. The indictment charges McWherter with a felony civil rights violation and with making false statements to the FBI.
The indictment alleges that on Jan. 30, 2006, officer McWerter assaulted an arrestee, identified in the indictment by the initials "D.C." by punching him in the mouth while he was handcuffed at the East St. Louis Police Department station. The indictment also alleges that the punch resulted in bodily injury to D.C. and that the officer lied to the FBI.
An indictment is a formal accusation of criminal conduct, not evidence of guilt, and the defendant is presumed innocent unless and until proven guilty.
If convicted, the defendant faces a maximum penalty of ten years in prison on the civil rights charge and five years on the false statement charge.
This case was investigated by the FBI and is being prosecuted by Civil Rights Division Trial Attorney Patricia Sumner, Special Litigation Counsel Jeffrey Blumberg and Assistant U.S. Attorney Angi Scott of the U.S. Attorney’s Office for the Southern District of Illinois.
Western Energy Company Will Pay $12.2 Million to U.S. & Montana to Settle Coal Royalties DisputeRead the Press Release
WASHINGTON—Western Energy Company, the operator of the Rosebud Mine on federal coal leases outside of Billings, Mont., has paid the United States more than $12 million in mineral royalties and accrued interest as the result of a settlement agreement announced today by the Justice Department and Department of the Interior.
Under the agreement that was filed in U.S. District Court for the District of Columbia, Western Energy has agreed to pay $12,239,538 in additional royalties and interest, 49 percent of which will be shared with the state of Montana because the production occurred on federal lands in that state. As part of the settlement, Western Energy also agrees to report and pay future royalties in accordance with Interior Department requirements.
"We are very pleased that this issue has been resolved," Secretary of the Interior Ken Salazar said. "I appreciate the work of our Minerals Management Service and especially the Department of Justice to ensure the American public is receiving a fair return on the mineral resources developed on Federal lands."
"This agreement is an excellent result that recovers mineral royalties on behalf of the Mineral Management Service and avoids further expensive and complicated litigation," said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division.
The additional royalties collected are the result of improper transportation allowances originally claimed by the coal producer. An added benefit of the settlement is that a portion of the additional royalties includes amounts that Interior did not seek because of a policy not to order additional royalties on production occurring more than seven years earlier. That policy was rescinded in 2007 and inclusion of this portion of the additional royalties in the settlement spares further enforcement action to collect them.
The agreement is the result of litigation brought by Western Energy against the Interior Department disputing the amount of additional royalties due on coal produced from the Rosebud Mine in southern Montana.
New York State and New York City to Pay Record $540 Million to Settle Allegations of False Claims for Medicaid FundsRead the Press Release
WASHINGTON – The state of New York and New York City have agreed to pay $540 million to settle allegations that they knowingly submitted, or caused to be submitted, false claims for reimbursement for school-based health care services, primarily speech therapy and transportation, provided to Medicaid eligible children from 1990 to 2001, the Justice Department announced today. The settlement is a record federal recovery by the Justice Department for the Medicaid Program.
Medicaid, which is administered by the Centers for Medicare & Medicaid Services (CMS) inside the Department of Health and Human Services, is a matching program in which the United States shares the cost of medical services for the poor and disabled with the states. Since the early 1990's, the United States has paid New York State billions of dollars as the federal government’s share of health care costs for services provided to Medicaid-eligible school children under New York’s School Supportive Health Services Program and Preschool Supportive Health Services Program. These programs were developed jointly by New York’s education and health departments to assist local school districts, counties, and other schools in obtaining Medicaid reimbursement for covered diagnostic and health support services provided to students with disabilities.
The settlement resolves allegations that for the period 1990 to 2001, the state of New York knowingly failed to provide proper guidance to the districts and counties outlining the requirements for a service to be covered by the Medicaid program, failed to monitor the districts and counties for compliance as required by the program and passed on claims to the federal government for services it knew were not covered or properly documented, all to make the United States pay a larger share of New York’s Medicaid costs.
In addition, the settlement resolves allegations that New York City submitted claims to the state for false speech services. The state then passed these claims on to the federal government for Medicaid reimbursement.
The state of New York will pay $440 million over time, partly in cash and partly by releasing its claim to payments withheld. New York City’s share of the settlement, $100 million, will also be paid over time. The state of New York also entered into a three-year Program Compliance Agreement with CMS to ensure that services are properly delivered and billed in the future.
The government’s allegations arose from two lawsuits filed under the qui tam or whistleblower provisions of the False Claims Act, which allow private persons, known as "relators," to file actions on behalf of the United States and share in any recovery. The relator in these cases, a speech therapist who provided services to preschool children in upstate New York, alleged that New York State and its school districts submitted false claims for speech services that did not qualify for Medicaid reimbursement. The relator will receive $10 million from the settlement.
The lawsuits triggered a series of statewide audits by the Health and Human Services Office of the Inspector General (HHS OIG) and CMS. The Department of Justice’s Civil Division, in conjunction with the HHS OIG and CMS, handled the case.
Justice Department Files Lawsuit Alleging Racial Discrimination at Apartment Complex in Clanton, AlabamaRead the Press Release
WASHINGTON – The Justice Department today filed a lawsuit against the owner and employees of Rolling Oaks Apartments, a 72-unit complex in Clanton, Ala., for violating the Fair Housing Act by discriminating on the basis of race or color in the rental of apartments.
The lawsuit, filed in the U.S. District Court for the Middle District of Alabama, alleges that the employees, Kenneth R. Scott and Frankie L. Roberson, told white testers that a selling point of Rolling Oaks Apartments was the lack of African American tenants and that they had adopted rental policies intended to discourage African American rental applicants. The allegations are based on evidence generated by the Department’s Fair Housing Testing Program, in which individuals pose as renters to gather information about possible discriminatory practices. The complaint also names Chandi Biswas, the owner of the complex.
"When housing providers tell renters that they have a preference for a particular race or color, they are blatantly practicing housing discrimination and creating an intolerable condition for all," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "The Department will continue its vigorous enforcement of all the fair housing laws."
The suit seeks monetary damages for those harmed by the defendants’ actions, civil penalties and a court order barring future discrimination.
Individuals who may have information related to this lawsuit should contact the Justice Department toll-free at 1-800-896-7743, mail box number 6. Fighting illegal housing discrimination is a top priority of the Justice Department. 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 http://www.usdoj.gov/crt.
The complaint is an allegation of unlawful conduct. The allegations must still be proven in federal court.
Former Wyoming Highway Patrol Trooper Pleads Guilty to Depriving Motorist of Civil Rights by KidnappingRead the Press Release
WASHINGTON – Franklin Joseph Ryle Jr., a former Wyoming Highway Patrol trooper, pleaded guilty on July 20, 2009, in federal court in Wyoming to depriving a man of his constitutional right to be free from unreasonable seizures by kidnapping him. Ryle also pleaded guilty to one count of using his firearm in relation to the crime.
While working on duty as a Wyoming Highway Patrol trooper on the night of Jan. 8, 2009, Ryle stopped a Wal-Mart truck with the intent to murder its driver and stage an accident with the truck that would either injure Ryle or kill his wife, allowing him to seek a monetary settlement from Wal-Mart.
Ryle stopped the driver on an isolated stretch of Interstate 25, a few miles southeast of Douglas, Wyo., and falsely told the driver that there was a warrant for his arrest, handcuffed him and placed him in the patrol car. Ryle drove away from the scene with the victim and unsuccessfully sought help from others for his scheme.
A sentencing hearing has not yet been scheduled.
The investigation was conducted by Wyoming Division of Criminal Investigation agents Mike Carlson and Darrin Cregger and FBI Special Agent Richard Fanelli. Civil Rights Division Trial Attorneys Edward Caspar and Christopher Lomax are prosecuting this case for the United States.