District Not Recorded
The source did not name an office we could identify. These records remain unassigned rather than guessed.
Computer Administrator Pleads Guilty to Hacking <br /> Former Employers Computer SystemRead the Press Release
The former director of information technology for a non-profit organ and tissue donation center has entered a guilty plea to intruding into her former employer’s computer network.
At a hearing before U.S. District Judge David Hittner, Danielle Duann, 51, admitted to illegally accessing the computer network of LifeGift Organ Donation Center and then intentionally deleting organ donation database records, accounting invoice files, database and accounting software applications and various backup files without authorization.
LifeGift is the sole provider of organ procurement services for more than 200 hospitals throughout 109 counties in North, Southeast and West Texas. Duann was previously indicted on this charge by a federal grand jury on June 24, 2008.
According to the statement of facts in the case, LifeGift terminated Duann from her position as their director of information technology on Nov. 5, 2005, and the organization revoked all of Duann’s previous administrative rights and access to the LifeGift computer network. Beginning in the evening of Nov. 7, 2005, and continuing into Nov. 8, 2005, Duann repeatedly gained unauthorized access to the LifeGift computer network via a remote connection from her home and intentionally caused damage by deleting numerous database files and software applications, as well as their backups, relating to LifeGift’s organ and tissue recovery operations.
Further, according to the statement of facts, in an attempt to conceal her activities, Duann disabled the computer logging functions on several LifeGift computer servers and erased the computer logs that recorded her remote access to the LifeGift computer network. LifeGift suffered damage and losses in excess of $94,200 as a result of Duann’s computer intrusion and intentional, unauthorized deletion of programs and files.
Duann is scheduled to be sentenced by Judge Hittner on July 28, 2009. She faces a maximum punishment of 10 years in prison and/or a fine of up to $250,000.
This case was investigated by the FBI and is being jointly prosecuted by Trial Attorney Thomas Dukes of the Criminal Division's Computer Crime and Intellectual Property Section and by Special Assistant U.S. Attorney Bret W. Davis of the Southern District of Texas.
Ali Al-Marri Pleads Guilty to Conspiracy <br /> to Provide Material Support to Al-QaedaRead the Press Release
Ali Saleh Kahlah al-Marri, 43, a dual national of Saudi Arabia and Qatar, has pleaded guilty to one count of conspiracy to provide material support to al-Qaeda.
Al-Marri entered his guilty plea at a hearing this afternoon before Judge Michael M. Mihm in U.S. District Court for the Central District of Illinois. In so doing, al-Marri admitted that he agreed with others to provide material support or resources to al-Qaeda in the form of personnel, including himself, to work under al-Qaeda’s direction and control with the intent to further the terrorist activity or terrorism objectives of al-Qaeda.
Judge Mihm scheduled sentencing for July 30, 2009. At sentencing, al-Marri faces up to 15 years imprisonment, a $250,000 fine, a life term of supervised release, and a $100 mandatory special assessment.
"Without a doubt, this case is a grim reminder of the seriousness of the threat we as a nation still face," said Attorney General Holder. "But it also reflects what we can achieve when we have faith in our criminal justice system and are unwavering in our commitment to the values upon which the nation was founded and the rule of law."
"The facts admitted by al-Marri today demonstrate that he attended terrorist training camps, learned al-Qaeda tradecraft and was dispatched by the highest levels of al-Qaeda to carry out its terrorist objectives in America," said David Kris, Assistant Attorney General for the National Security Division. "The many agents, analysts and prosecutors who worked tirelessly on this investigation and prosecution deserve special thanks for their efforts."
"Ali al-Marri was an al-Qaeda ‘sleeper’ operative working on U.S. soil and directed by the chief planner of the 9-11 attacks. Al-Marri researched the use of chemical weapons, potential targets and maximum casualties," said Arthur M. Cummings, II, Executive Assistant Director of the FBI’s National Security Branch. "The investigation that disrupted his plot began with tips from local police partners. The investigation that followed took the FBI agents and task force officers around the globe to develop the intelligence to prevent any potential attack and the evidence to bring al-Marri to justice."
"Ali al-Marri today admitted that he traveled to central Illinois as an al-Qaeda operative the day before the Sept.11, 2001, attacks to plan and prepare for future acts of terrorism within the United States," said Jeffrey B. Lang, Acting U.S. Attorney for the Central District of Illinois. "Al-Marri’s admissions, in open court and after again being advised of his right to a jury trial, confirm the many details of the government’s findings as a result of the exemplary investigative efforts by the FBI and other agencies."
On Jan. 22, 2009, the President directed the Attorney General to lead an interagency review of the case involving al-Marri, who had been detained as an enemy combatant by the Defense Department since June 2003. As a result of that review and an examination of the evidence gathered during the long-term investigation of al-Marri, the Justice Department decided to charge al-Marri in federal court. On Feb. 26, 2009, a federal grand jury in the Central District of Illinois returned a two-count indictment charging al-Marri with conspiring with others to provide material support to al-Qaeda and providing material support to al-Qaeda.
Al-Marri was later transferred from the custody of the Defense Department to the custody of the Justice Department and brought to the Central District of Illinois for trial on the two-count indictment. As part of the plea agreement announced today, the Justice Department has agreed to dismiss the second count of the indictment. In pleading guilty, al-Marri has admitted the following facts, as spelled out in the plea agreement.
Statement of Facts
Between 1998 to 2001, al-Marri attended various terrorist training camps where he learned the use of weapons and operational security tradecraft that al-Qaeda employed to avoid detection, conceal their communications and protect their operations. These methods included prearranged codes and other techniques to protect communications, counter-surveillance techniques and the protection of information on computers.
During these trips, al-Marri stayed in safe houses in Pakistan, which he agrees the government would prove were run by al-Qaeda. While in the terrorist training camps and safe houses, he used the nickname "Abdul-Rahman al-Qatari," and provided al-Qaeda operatives with his family contact information so they could inform his family should he be killed or "martyred" during an al-Qaeda mission.
In 2001, al-Marri was approached by Khalid Sheikh Mohammed, who was then the external operations chief for al-Qaeda, about assisting al-Qaeda operations in the United States. Al-Marri agreed to do so and knew at the time that he entered into the agreement with Khalid Sheikh Mohammed that he was providing himself to al-Qaeda to further their terrorist objectives. Al-Marri was also aware that al-Qaeda was responsible for attacks against the United States, including the 1998 bombings of two U.S. Embassies in East Africa, and the 2000 attack on the USS Cole. In addition, he was aware of the 1996 and 1998 "fatwas" issued by Usama bin Laden against the United States.
Al-Marri was instructed by Khalid Sheikh Mohammed to enter the United States no later than Sept. 10, 2001, with an understanding that he was to remain in the United States for an undetermined length of time. Khalid Sheikh Mohammed also directed al-Marri to meet with Mustafa al-Hawsawi (hereinafter al-Hawsawi) in Dubai, United Arab Emirates, where al-Hawsawi provided him with $10,000. Al-Marri knew that al-Hawsawi was associated with al-Qaeda and agrees that the government would prove at trial that al-Hawsawi was a primary financier of the September 11th attacks.
Communications in Code
Khalid Sheikh Mohammed and al-Marri also set up a code through which they communicated. Al-Marri was instructed to conceal telephone numbers and other numbers to be used in e-mail addresses by using a numeric code (hereinafter, "10-code"). This code was used by al-Qaeda members, including al-Hawsawi and some of the Sept. 11th hijackers to conceal telephone numbers so as to avoid detection. Al-Marri was also provided contact information for several al-Qaeda associates which he stored in his personal PDA (Personal Digital Assistant) using the 10-code.
Khalid Sheikh Mohammed and al-Mari also used a pre-arranged code to disguise their email communications. The pre-arranged communication method referred to Khalid Sheikh Mohammed as "Muk." Al-Marri was to refer to himself as "Abdo" in these communications and to send emails to [email protected], an email account used by Khalid Sheikh Mohammed. Through these emails, al-Marri was to keep Khalid Sheikh Mohammed apprised of his efforts to enter the United States, his contact information and his efforts to advance al Qaeda’s mission in the United States. Khalid Sheikh Mohammed was to use these emails to pass on instructions to al-Marri.
Details of the prearranged code were stored in an address book that was found in an al-Qaeda safe house in Pakistan. The book contained the email address to be used by al-Marri, which was listed as [email protected] , along with the identification number for al-Marri of "038." From this coded information, al-Marri used the email address of [email protected]. The address book also listed Khalid Sheikh Mohammed’s email address as HOR70@hot[mail.com].
From approximately June 2001 through August 2001, al-Marri communicated via email with Khalid Sheikh Mohammed, as directed and agreed upon, about his attempts to gain entry into the United States via a student visa from Bradley University in Peoria, Ill.. He applied online to Bradley University using the same email address he used to communicate with Khalid Sheikh Mohammed. To expedite his admission, he applied for a second bachelor’s degree instead of a master’s degree.
Once al-Marri learned he had been re-enrolled in Bradley University, he traveled to Dubai and met with al-Hawsawi, who provided him $10,000. Al-Marri then traveled to Pakistan to meet Khalid Sheikh Mohammed. Upon his return to Qatar, al-Marri applied for a new Qatari passport. He also obtained his student visa, but did not admit on his visa application that he had taken a trip to the United States in 2000, where he had established a fictitious business using a false name and stolen Social Security number, fraudulently obtaining a number of credit cards and opening several business accounts.
Arrival in the United States
Al-Marri and his family arrived in the United States on Sept. 10, 2001. On Sept. 21, 2001, he traveled to another university in Illinois and created five new email accounts under different aliases. By this time, he knew al-Qaeda was responsible for the Sept. 11, 2001 attacks and understood why Khalid Sheikh Mohammed had directed him to be in the United States before that date. Al-Marri used these new e-mail accounts to inform Khalid Sheikh Mohammed that he had arrived safely in the United States. He also provided Khalid Sheikh Mohammed with his Peoria cellular telephone number.
From Sept. 23, 2001 through Nov. 4, 2001, al-Marri made several unsuccessful attempts to call al-Hawsawi and others he knew were al-Qaeda operatives. To conceal his communications efforts, he used prepaid calling cards at public pay phones in and around central and northern Illinois. Although the initial calls were made from payphones in the Peoria area, after al-Marri was interviewed by the FBI on Oct. 2, 2001, he expanded the calling area, sometimes traveling more 160 miles away to place calls.
Al-Marri also conducted online research of various cyanide compounds, including hydrogen cyanide, potassium cyanide, and sodium cyanide. He reviewed toxicity levels, locations where these items could be purchased, and specific pricing of the compounds. He also explored obtaining sulfuric acid, a well-known binary agent used in a hydrogen cyanide binary device to create cyanide gas. Al-Marri agrees that the government would prove at trial this is the method taught by al Qaeda for manufacturing cyanide gas.
Al-Marri agrees that the government would prove at trial that his research into cyanide compounds is consistent with research conducted by persons trained in camps teaching advanced poisons courses to terrorist organizations, including al Qaeda. He also agrees that the government would prove at trial that an almanac recovered in his residence was bookmarked at pages showing dams, waterways and tunnels in the United States, consistent with al Qaeda attack planning regarding the use of cyanide gases.
Finally, al-Marri used an "anonymizer" program on his laptop when surfing the internet. He agrees that the government would prove at trial that these types of programs are designed to allow individuals to anonymously search internet websites and programs, and that the program on his computer also erased all historical internet searches on a regular basis.
In December 2001, al-Marri was arrested on a material witness warrant issued in connection with the investigation of the Sept. 11, 2001 attacks. He was later indicted on credit card fraud, false statements and identity fraud charges. These charges were dismissed on June 23, 2003, when al-Marri was designated by President Bush as an enemy combatant and transported to the Naval Consolidated Brig in South Carolina. Al-Marri remained detained by the Defense Department until his transfer to Justice Department custody this year in connection with this case.
The al-Marri investigation was conducted by the FBI Joint Terrorism Task Force in Springfield, Illinois, with assistance from numerous other federal, state, and local agencies.
The case is being prosecuted by Trial Attorneys Joanna Baltes and Sharon Lever of the Counterterrorism Section of the Justice Department’s National Security Division, and Assistant U.S. Attorney David E. Risley of the U.S. Attorney’s Office for the Central District of Illinois. Assistant U.S. Attorney Kevin F. McDonald of the U.S. Attorney’s Office for the District of South Carolina also provided critical assistance.
Two Additional Defendants Sentenced for Conspiring to Kill U.S. SoldiersRead the Press Release
WASHINGTON – The remaining two men convicted of plotting to kill members of the U.S. military during an armed attack on a military base were sentenced today to federal prison terms of life for one defendant and 33 years for the other for conspiring to kill members of the U.S. military, Ralph J. Marra Jr., Acting U.S. Attorney for the District of New Jersey; David Kris, Assistant Attorney General for National Security; and Janice K. Fedarcyk, Special Agent in Charge of the Philadelphia Division of the FBI, announced.
U.S. District Judge Robert B. Kugler sentenced Mohamad Ibrahim Shnewer to a term of life in prison plus an additional, consecutive 30 years. Judge Kugler sentenced Serdar Tatar to 33 years in prison. There is no parole in the federal system.
Judge Kugler, who presided over a 12-week trial for the five defendants, also ordered Shnewer and Tatar to pay $125,000 in restitution to the Department of the Army for the costs of added security measures undertaken in response to the plot.
Yesterday, Judge Kugler sentenced Dritan Duka and Shain Duka to prison terms of life plus 30 years. The third brother, Eljvir Duka, received a life prison term. The same $125,000 restitution order was imposed for them as well.
The case was tried by Deputy Assistant U.S. Attorney William E. Fitzpatrick and Assistant U.S. Attorney Michael A. Hammer, Jr., Chief of the U.S. Attorney’s Office Counter-Terrorism Unit.
"The sentences are appropriate in each instance and we are pleased and gratified by the results," said Marra. "Over the last few years, this investigation and prosecution was of the highest priority for us and our law enforcement partners. Now that the case is behind us, I want to commend the trial attorneys, agents, investigators and all others who worked tirelessly to keep our soldiers, civilian employees and military bases safe."
"The sentences handed down today, along with the sentences in this case yesterday, reaffirm for all of us the value of the commitment we have made to live free from the tyranny of fear," said Special Agent in Charge Janice K. Fedarcyk, of the Philadelphia Division of the FBI. "The FBI’s top priority is to protect this nation from terrorism, and addressing threats of terrorist acts quickly and aggressively is the only way to succeed in this important mission."
"These sentences are the culmination of an extensive federal, state and local law enforcement operation," said David Kris, Assistant Attorney General for National Security. "While these defendants were not members of an international terrorist organization, their homegrown plot to murder U.S. military personnel at Fort Dix was no less serious or potentially deadly."
The defendants’ arrests occurred on May 7, 2007, in Cherry Hill as Dritan and Shain Duka were meeting a confidential government witness to purchase four automatic M-16 rifles and three semi-automatic AK-47 rifles to be used in a future attack on military personnel. The other defendants were arrested at various locations at about the same time.
On Dec. 22, 2008, after 5½ days of deliberations, a jury convicted the three Duka brothers, Shnewer and Tatar on Count One of the seven-count Superseding Indictment that charged them with conspiracy to murder members of the U.S. military. The jury also convicted the Dukas and Shnewer of firearm offenses, including possession of machine guns.
The evidence proved that one member of the group conducted surveillance at Fort Dix and Fort Monmouth in New Jersey, Dover Air Force Base in Delaware and the U.S. Coast Guard in Philadelphia. The co-conspirators obtained a detailed map of Fort Dix, where they hoped to use assault rifles to kill as many soldiers as possible, according to trial testimony and evidence.
During the trial, the jury viewed secretly recorded videotapes of the defendants performing small-arms training at a shooting range in the Pocono Mountains in Pennsylvania and watching training videos amongst themselves that included depictions of American soldiers being killed and of known foreign Islamic radicals urging jihad against the United States.
The defendants and the charges on which each was convicted are as follows:
- Mohamad Ibrahim Shnewer, 24, of Cherry Hill: conspiracy to murder members of the U.S. military, and the attempted possession of AK-47 semi-automatic assault weapons to be used in the attack.
- Dritan Duka, 30 of Cherry Hill: conspiracy to murder members of the U.S. military; possession of machine guns; possession and attempted possession of machine guns in furtherance of a crime of violence; and two counts of possession of firearms by an illegal alien.
- Shain Duka, 28, of Cherry Hill: conspiracy to murder members of the U.S. military; possession of machine guns; possession and attempted possession of machine guns in furtherance of a crime of violence; and two counts of possession of firearms by an illegal alien.
- Eljvir Duka, 25, of Cherry Hill: conspiracy to murder members of the U.S. military, and possession of firearms by illegal aliens. The jury acquitted on one count of possession and attempted possession of machine guns in furtherance of a crime of violence.
- Serdar Tatar, 25, of Philadelphia: conspiracy to murder members of the U.S. military.
A sixth co-defendant, Agron Abdullahu, 26, of Buena Vista Township, Atlantic County, pleaded guilty before Judge Kugler on Oct. 31, 2007, to aiding and abetting the Duka brothers’ illegal possession of weapons. Abdullahu was arrested on May 7, 2007, along with the defendants convicted today. On March 31, 2008, Judge Kugler sentenced Abdullahu to 20 months in federal prison.
Marra and Kris credited the Special Agents of the FBI’s Philadelphia Division and the FBI South Jersey Joint Terrorism Task Force, under the direction of Special Agent in Charge Fedarcyk, in Philadelphia, for investigation of the case.
Marra, Kris and Fedarcyk also thanked investigators with member agencies of the FBI South Jersey Joint Terrorism Task Force, which comprises ICE’s Philadelphia Division, under the direction of Special Agent in Charge John P. Kelleghan, the Camden County Prosecutor’s Office, under the direction of the Prosecutor Warren W. Faulk, N.J. State Police, under the direction of Col. Joseph "Rick" Fuentes, Superintendent, and the Delaware River Port Authority Police, under the direction of Chief Dave McClintock, for their tireless efforts on the investigation, and trial attorney John Van Lunkhuysen of the Counterterrorism Section of the Justice Department’s National Security Division, for his trial preparation assistance.
Additionally, Marra, Kris and Fedarcyk would like to thank the following agencies for their assistance and support: the U.S. military services at Fort Dix, Fort Monmouth, Dover Air Force Base, the U.S. Coast Guard in Philadelphia and the Naval Criminal Investigative Service, along with the Cherry Hill Police Department, Mt. Laurel Police Department, Cherry Hill Fire Department, Camden County Sheriff's Department, Philadelphia Police Department, Pennsylvania State Police, the Burlington County Prosecutor’s Office, and N.J. Homeland Security.
Justice Department Sues Nobel Learning Communities Inc. for Discrimination Against Children with DisabilitiesRead the Press Release
WASHINGTON – The Justice Department announced today it has filed a lawsuit in U.S. District Court in Philadelphia against Nobel Learning Communities Inc. (Nobel) alleging the company violated Title III of the Americans with Disabilities Act by excluding children with autism spectrum disorders and other disabilities from its schools and programs.
The complaint identifies children with disabilities denied admission to or removed from Nobel schools in several states. Nobel is a network of more than 180 private preschools, elementary schools and secondary schools in fifteen states, operating under various names including Chesterbrook Academies, Evergreen Academies, Bethesda Country Day School and Merryhill Schools. Nobel also provides child care services and summer programs.
"All parents want their child to have the opportunity to reach his or her full potential," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "The Justice Department will vigorously enforce Title III of the ADA to ensure that children with disabilities have a full and equal opportunity to participate in academic and non-academic activities."
Title III of the ADA prohibits public accommodations, including private schools such as Nobel, from excluding individuals with disabilities from programs or services offered by the public accommodation. Covered entities must also make reasonable modifications if such modifications would permit the individual with a disability a full and equal opportunity to participate in or benefit from the programs and services offered. Parents or guardians who believe their child may have been discriminated against on the basis of disability can contact the Justice Department’s Civil Rights Division.
Those interested in finding out more about federal disability rights statutes can call the Justice Department’s toll-free ADA Information Line at (800) 514-0301 or (800) 514-0383 (TTY), or access the ADA Web site at www.ada.gov.
Former Head Securities Trader for Lancer Group Hedge Funds Pleads Guilty to Conspiracy to Commit Mail, Wire and Securities FraudRead the Press Release
WASHINGTON - The former head securities trader for Lancer Group hedge funds pleaded guilty on April 28, 2009, to one count of conspiracy to commit mail, wire and securities fraud, Assistant Attorney General Lanny A. Breuer of the Criminal Division and U.S. Attorney R. Alexander Acosta for the Southern District of Florida announced today.
Eric Hauser, 65, pleaded guilty before U.S. District Court Judge Adalberto Jordan in Miami. Hauser admitted to participating in a scheme to manipulate trading of stocks owned by the Lancer Group hedge funds. Sentencing for Hauser is scheduled for July 10, 2009.
Hauser was one of five defendants charged in an indictment unsealed in February 2008 in Miami. Also charged in the indictment are Michael Lauer and Martin Garvey who, along with Hauser, were co-owners of management companies that directed Lancer Group hedge funds’ activities, and Laurence Isaacson and Milton Barbarosh, who the indictment alleges had financial interests in Boca Raton, Fla.-based "shell" companies in which the hedge funds invested. All of the defendants were charged with one count of conspiracy to commit mail, wire and securities fraud, and six counts of wire fraud. A trial date has not yet been set for Lauer, Garvey, Isaacson or Barbarosh.
According to the indictment, Lauer, as founder and primary manager, formed and directed several hedge funds, collectively known as the Lancer Group hedge funds. From October 1999 to July 2003, Lauer and others allegedly manipulated the closing market price of thinly-traded shell company securities to falsely inflate the value of the Lancer Group hedge funds. Lauer, Isaacson and Barbarosh allegedly identified "shell" companies, including ones owned by Barbarosh, in which the Lancer Group would buy large quantities of "restricted" stock at pennies per share in private transactions. According to the indictment, Lauer, Garvey and Hauser next allegedly directed brokers to buy a small amount of the same securities for the Lancer Group at a much higher open market price and to make additional small purchases to drive up the price to a closing "target price." Lauer then allegedly falsely valued all of the securities held by the Lancer Group, including those restricted shares obtained for pennies per share, at the much higher closing price, which falsely boosted the 20 percent performance fees paid to the management companies; induced new investors to buy into the funds; and kept existing investors in the funds.
To cover up and perpetuate the scheme, the indictment alleges, Lauer also created fake portfolios of the securities supposedly held by the Lancer Group and allegedly obtained falsely inflated appraisals of the shell companies through Isaacson and Barbarosh.
An indictment is merely a charge. All defendants are presumed innocent until proven guilty.
The case was investigated by the FBI and is being prosecuted by Senior Litigation Counsel Jack Patrick of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Harold Schimkat of the U.S. Attorney’s Office for the Southern District of Florida.
Dutch Airline Executive Agrees to Plead Guilty for Fixing Prices on Air Cargo ShipmentsRead the Press Release
WASHINGTON — A Dutch citizen and executive of Martinair Holland N.V. (Martinair) has agreed to plead guilty, serve time in jail and pay a criminal fine for participating in a conspiracy to fix cargo rates for international air shipments, the Department of Justice announced today.
Including today’s charge, a total of 15 airlines and four executives have pleaded guilty or agreed to plead guilty in the Justice Department’s ongoing investigation into price fixing in the air transportation industry. Collectively, the companies have paid or agreed to pay criminal fines totaling more that $1.6 billion and three executives have already been sentenced to jail time.
According to the charge filed in U.S. District Court in the District of Columbia, Franciscus Johannes de Jong, aka Frank de Jong, the former vice president of cargo sales in Europe for Martinair, and his co-conspirators engaged in a conspiracy to fix the cargo rates charged to customers for international air shipments, including to and from the United States. Under the plea agreement, which is subject to court approval, de Jong has agreed to serve eight months in jail, pay a $20,000 criminal fine and cooperate with the Department’s ongoing investigation.
"By fixing prices for the shipment of products to and from the United States, this cartel targeted a critical piece of our country’s economy," said Scott D. Hammond, Deputy Assistant Attorney General in charge of the Antitrust Division’s Criminal Enforcement Program. "The Department remains dedicated to aggressively pursuing those who conspire to cheat American businesses and consumers with price-fixing schemes."
According to the charge, from at least as early as April 2002 and continuing until at least Feb. 14, 2006, de Jong and his co-conspirators carried out the price-fixing conspiracy by:
- Participating in meetings, conversations and communications to discuss the cargo rates to be charged on certain routes to and from the United States;
- Agreeing, during those meetings, conversations and communications, on certain components of the cargo rates to charge on shipments on certain routes to and from the United States;
- Levying cargo rates in the United States and elsewhere in accordance with the agreements reached; and
- Engaging in meetings, conversations and communications in the United States and elsewhere for the purpose of monitoring and enforcing adherence to the agreed-upon cargo rates.
The 15 airlines that have pleaded guilty or agreed to plead guilty to date as a result of the Department’s ongoing investigation into the air transportation industry are: British Airways Plc, Korean Air Lines Co. Ltd., Qantas Airways Limited, Japan Airlines International Co. Ltd., Martinair, Cathay Pacific Airways Limited, SAS Cargo Group A/S, Société Air France, Koninklijke Luchtvaart Maatschappij N.V. (KLM Royal Dutch Airlines), EL AL Israel Airlines Ltd., LAN Cargo S.A., Aerolinhas Brasileiras S.A., Cargolux Airlines International S.A., Nippon Cargo Airlines Co. Ltd., and Asiana Airlines Inc. Airline executives who have already pleaded guilty for their involvement in the illegal activity are Bruce McCaffrey of Qantas, Timothy Pfeil of SAS and Keith Packer of British Airways.
De Jong is charged with price fixing in violation of the Sherman Act, which carries a maximum fine of $1 million and up to 10 years in prison for an individual. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.
The ongoing investigation is being conducted by the Antitrust Division’s National Criminal Enforcement Section, the Federal Bureau of Investigation (FBI), the Department of Transportation Office of Inspector General and the United States Postal Service Office of the Inspector General. Anyone with information concerning price fixing or other anticompetitive conduct in the air transportation industry is urged to call the National Criminal Enforcement Section of the Antitrust Division at 202-307-6694 or the FBI Washington Field Office, Northern Virginia Resident Agency at 703-686-6000.
Attorney General Holder Announces Recovery Act Grants to Save or Create Justice Related JobsRead the Press Release
U.S. Attorney General Eric Holder today announced that more than $424 million in Recovery Act funds will go to 20 states, territories and the District of Columbia to maintain or increase public safety, while creating or retaining jobs within the law enforcement community. These Edward Byrne Memorial Justice Assistance Grant (JAG) Program funds are part of more than $4 billion in Justice Department Recovery Act funds available to assist state, local and tribal law enforcement and for other criminal justice activities that help to prevent crime and improve the criminal justice system in the United States while supporting the creation of jobs and much needed resources for states and local communities.
All applicants named job creation and retention as their top priority, and states plans include funding for a variety of justice related projects such as support for drug and gang task force activities, expansion of domestic violence shelter staffs, funding for community crime prevention and treatment programs, purchase of updated equipment, and retention and creation of criminal justice-related jobs in areas such as drug courts, correctional facilities, community crime prevention, and crime victim and witness programs.
"By addressing states’ economic challenges while simultaneously meeting the their public safety priorities, these funds represent the best of what the Recovery Act can do for our communities," Attorney General Eric Holder said. "This vital funding will help fight crime and build safer communities, and we look forward to continued work with state and local governments to address these criminal justice goals."
The procedure for allocating JAG grants is based on a formula of population and violent crime statistics, in combination with a minimum allocation to ensure that each state and territory receives an appropriate share of funding. Sixty percent of the allocation is awarded directly to a state and 40 percent is set aside for units of local government. States are required to sub-grant a portion of the funds to local units of government, such as a city, county, township or town. Faith-based and other community organizations are also eligible to receive pass-through funding from the state, as are Tribal governments.
Local Recovery Act JAG awards will be announced at a later date. The deadline for local units of government to submit their Recovery Act applications to the Department of Justice is May 18, 2009.
The JAG Program is the primary provider of federal criminal justice funding to state and local jurisdictions and is managed by the Department’s Office of Justice Programs’ Bureau of Justice Assistance. JAG funds support all components of the criminal justice system, from multi-jurisdictional drug and gang task forces to crime prevention and domestic violence programs, courts, corrections, treatment, and justice information sharing initiatives. Projects may address crime through the provision of services directly to individuals and/or communities and by improving the effectiveness and efficiency of criminal justice systems, processes, and procedures. For more details on the JAG Program or to track the use of Recovery Act funds, visit www.ojp.gov/recovery. For more details on how to apply for the state managed,
pass-through funding, visit http://www.ojp.usdoj.gov/saa/index.htm.
The Office of Justice Programs, headed by Acting Assistant Attorney General Laurie O. Robinson, provides federal leadership in developing the nation's capacity to prevent and control crime, administer justice, and assist victims. OJP has five component bureaus: the Bureau of Justice Assistance; the Bureau of Justice Statistics; the National Institute of Justice; the Office of Juvenile Justice and Delinquency Prevention; and the Office for Victims of Crime. Additionally, OJP has two program offices: the Community Capacity Development Office, which incorporates the Weed and Seed strategy, and the Office of Sex Offender Sentencing, Monitoring, Apprehending, Registering, and Tracking (SMART). More information can be found at www.ojp.gov.
State plan summaries are as follows:
Alabama, $18.7 million:
The Alabama Department of Economic and Community Affairs (ADECA), Law Enforcement and Traffic Safety Division (LETS) plans to support testing capabilities to detect use of illegal drugs, identify drug abusers, and provide a treatment system; provide systems for intelligence-gathering, data collection and analysis to assist in coordinating enforcement efforts; and support state projects to stabilize the government budgets to minimize and avoid reductions in essential services and counter-productive state and local tax increases.
Arizona, $25 million:
The Arizona Criminal Justice Commission (ACJC) plans to support the statewide effort to fight drug trafficking and violent crime. Priority will be given to job creation and retention, particularly jobs key to multi-agency, multi-jurisdictional drug, gang, and violent crime task forces; the associated prosecution projects and statewide civil forfeiture efforts; criminal justice information sharing projects; adjudication, forensic analysis, detention, and criminal justice system support services; and proven substance abuse prevention and education programs.
Connecticut, $12 million:
The Connecticut Office of Policy and Management (OPM) plans to expand the Department of Corrections case management system; upgrade automated fingerprinting systems; support drug task force activities; increase the number of DNA samples obtained from inmates and expedite sample processing; increase the visibility of state police vehicles to reduce collisions; expand domestic violence shelter staffs; establish a sexual assault forensic examiner program; provide more effective facility and community based corrections programs; and translate community outreach, education and media materials.
Colorado, $18 million:
The Colorado Division of Criminal Justice Services plans to support efforts to prevent and control crime; improve the criminal and juvenile justice systems; improve law enforcement’s operational effectiveness; improve the corrections system, including treatment in prisons and jails; improve the operational effectiveness of the court process; address the treatment needs of adult and juvenile substance abuse and mentally ill offenders; and respond to the needs of crime victims.
Delaware, $6 million:
The Delaware Criminal Justice Council plans to support efforts to prevent and control crime by enhancing gang and gun trafficking initiatives; police/parole and probation partnerships; witness protection and multi-agency initiatives to incarcerate fugitives; sex offender monitoring; drug/mental health courts; targeting violent adult and juvenile offenders; upgrading officer safety equipment; retaining correctional officers; and expanding the successful Operation Safe Streets initiative.
District of Columbia, $11.7 million:
The District Of Columbia Justice Grants Administration plans to support efforts to prevent and control crime; improve technology for core operations; law enforcement initiatives; prevention and education efforts; technology and research; and corrections and community corrections with special emphasis on at-risk youth/status offender diversion initiatives and prisoner re-entry.
Florida, $81 million:
The Florida Department of Law Enforcement plans to support law enforcement efforts such as eradicating marijuana, dismantling clandestine laboratories; disrupting illicit commerce; targeting white collar, computer, and organized crimes; along with prevention initiatives such as anti drug and gang education programs; school resource officers; community crime prevention, policing, and corrections programs.
Kansas, $12 million:
The Kansas Criminal Justice Coordinating Council (KCJCC) plans to preserve or create criminal justice-related jobs for parole officers, community corrections officers, juvenile correctional officers, special criminal investigations agents, criminal prosecutor, and technical specialists; while also supporting initiatives in community corrections, juvenile supervision and case management; internet safety; criminal investigations and prosecutions; forensic evidence analysis; training and prevention efforts; and equipment upgrades.
Louisiana, $21 million:
The Louisiana Commission on Law Enforcement and Administration of Criminal Justice (LCLE) plans to establish or continue programs to impact drug and violent crime problems across the state; address recidivism by strengthening prevention of crime and drug abuse intervention, treatment, and rehabilitation; provide specialized law enforcement training; and enhance forensics laboratories.
Maryland, $26.5 million:
The Maryland Governor’s Office of Crime Control and Prevention (GOCCP) plans to support the creation and retention of public safety-related jobs while also removing warranted fugitives from the streets; upgrading communications and forensic equipment; purchasing computer and software technology; improving prison and jail security; investing in data-driven policing strategies to include intelligence-based parole and probation supervision and partnerships, cross-border collaborations with neighboring States, and gang enforcement and gun trafficking initiatives.
Massachusetts, $25 million:
The Massachusetts Executive Office of Public Safety and Security (EOPS) will use the funding to maintain or increase public safety in the Commonwealth, while creating or retaining jobs. EOPS plans to support summer youth employment programming, community-based prevention programs, district attorneys’ prosecution, victim witness advocacy, community programs, sheriffs’ department re-entry programs, local law enforcement policing and programs, and state public safety agencies’ core services.
Michigan, $41 million:
The Michigan Office of Drug Control Policy will use the funding to maintain or increase public safety in the state, while creating or retaining jobs within the law enforcement community. The Office of Drug Control Policy estimates that the jobs created or saved will be for case managers, court liaisons, and peer support advocates in mental health courts as well as continued employment of State Appellate Defender Office staff who provide state-funded appellate services for felony convictions for indigent clients. The state also plans to support strategies for multi-jurisdictional task forces, prescription and over-the-counter drug abuse community awareness programs; community policing and community prosecution strategies; technology enhancement projects; local correctional resources and problem solving courts including drug treatment, domestic violence, family dependency, and mental health.
Mississippi, $11 million:
The Mississippi Division of Public Safety Planning will use the funding to maintain or increase public safety in the state, while creating or retaining jobs within the law enforcement community. The state also plans to use the funds to support multi-jurisdictional drug task force programs and initiatives, community crime prevention and treatment programs; drug court operations; juvenile justice programs; cold case initiatives; law enforcement training programs; crime labs; and victims of domestic violence, sexual assault and child abuse.
Nevada, $13.8 million:
The Nevada Department of Public Safety (NDPS) anticipates the retention and hiring of gang and task force personnel; and plans to support anti drug and violent crime initiatives to include anti drug and gang prevention, education, and treatment programs; information sharing and coordination; alternative sentencing programs; multifaceted community response programs; rural K-9 program; law enforcement training; and a statewide records management system.
New Hampshire, $6 million:
The New Hampshire Department of Justice plans to support cold case and narcotics investigative resources; enhancements of prosecution resources for consumer protection, county and local district court; victim witness advocates and child advocacy centers; recidivism reduction and specialty court programs; and initiatives to increase the efficiency, and reduction of crime and victimization.
New Jersey, $29.7 million:
The New Jersey Department of Law and Public Safety plans to support the state's Safe Streets and Neighborhoods Program focusing on law enforcement, prevention, and reentry; including multilevel task forces targeting violent gangs, guns, and narcotics; workforce readiness skills programs; job placement; education and youth development; expanding intervention and prevention programs; reducing recidivism; enhancing discharge planning for juvenile and offenders with mental health needs; and establishing a pilot program for intervention counselors to address technical parole violators.
New Mexico, $11 million:
The New Mexico Department of Public Safety plans to focus on preserving and creating jobs and promoting economic recovery while supporting improvements to the state's criminal justice system to reduce violent crime and the sale of illicit drugs; identifying and reporting drug and gang trends; updating the state's Drug and Gang Policy; and promoting strategies to identify, prevent, and respond to terrorism networks.
Northern Mariana Islands, $1.6 million:
The Northern Mariana Islands’ Criminal Justice Planning Agency (CJPA) plans to create new full-time positions that will support or directly impact efforts to stabilize local budgets to avoid a decline in essential services or an increase in local taxes; multi-jurisdictional drug and gang task forces; crime prevention programs; law enforcement programs; domestic violence programs; courts; corrections; treatment; and justice information sharing initiatives.
South Carolina, $23 million:
The South Carolina Department of Public Safety plans to support efforts to hire personnel; purchase equipment; conduct training and technical assistance; projects to control crime and drugs; and enhancements to the criminal justice information systems to increase the apprehension, prosecution, adjudication, detention, and rehabilitation of persons who violate laws.
Tennessee, $30.8 million:
The Tennessee Department of Finance and Administration, Office of Criminal Justice Program (OCJP) plans to require grant recipient agencies to use the Recovery Act JAG funds for the retention and creation of jobs supporting the criminal justice system in areas such as drug courts; correctional programming; crime victim and witness programs; multi-jurisdictional drug and violent crime task forces; criminal justice professional enhancement training; pretrial service delivery; technology improvement; and community crime prevention.
Three Brothers Sentenced to Life Prison Terms for Conspiring to Kill U.S. SoldiersRead the Press Release
WASHINGTON -- Three brothers who were convicted of plotting to kill members of the U.S. military during an armed attack on a military base were sentenced today to life prison terms, Ralph J. Marra Jr., Acting U.S. Attorney for the District of New Jersey; David Kris, Assistant Attorney General for National Security; and Janice K. Fedarcyk, Special Agent in Charge of the Philadelphia Division of the FBI, announced.
U.S. District Judge Robert B. Kugler sentenced Dritan Duka and Shain Duka to prison terms of life plus an additional, consecutive 30 years. The third brother, Eljvir Duka, received a life prison term. There is no parole in the federal system.
Judge Kugler, who presided over a 12-week trial of the Dukas and two other co-defendants, also ordered the Dukas to pay $125,000 in restitution to the Department of the Army for the costs of added security measures undertaken in response to the plot..
The final two defendants, Mohamad Ibrahim Shnewer and Serdar Tatar, are scheduled to be sentenced tomorrow by Judge Kugler.
"The hatred and contempt these young men hold for America and the rule of law was made abundantly clear during the investigation, at trial and even today as they spoke at their sentencings," said Acting U.S. Attorney Marra. "Not one word of contrition was heard from any of them, only more hatred and contempt. For their actions and their words, the sentences are appropriate to both protect the public from them and their deeply held, radical beliefs and to deter others who would act similarly."
"The sentences handed down today against these defendants underscore the importance of vigilance," said Special Agent in Charge Janice K. Fedarcyk, of the Philadelphia Division of the FBI. "We in law enforcement, at every level, must work together with the public to remain alert to, and responsive to, every threat to insure that terrorism threats do not become terrorist acts. Defeating terrorism remains the FBI’s top priority."
"These sentences are the culmination of an extensive federal, state and local law enforcement operation," said David Kris, Assistant Attorney General for National Security. "While these defendants were not members of an international terrorist organization, their homegrown plot to murder U.S. military personnel was no less serious or potentially deadly."
The case was tried by Deputy Assistant U.S. Attorney William E. Fitzpatrick and Assistant U.S. Attorney Michael A. Hammer, Jr., Chief of the U.S. Attorney’s Office Counter-Terrorism Unit.
The defendants’ arrests occurred on May 7, 2007, in Cherry Hill as Dritan and Shain Duka were meeting a confidential government witness to purchase four automatic M-16 rifles and three semi-automatic AK-47 rifles to be used in a future attack on military personnel. The other defendants were arrested at various locations at about the same time.
On Dec. 22, 2008, after 5½ days of deliberations, a jury convicted the three Duka brothers, Shnewer and Tatar on Count One of the seven-count Superseding Indictment that charged them with conspiracy to murder members of the U.S. military. The jury also convicted the Dukas and Shnewer of firearm offenses; including possession of machine guns. See below for conviction details on each of the defendants.
The evidence proved that one member of the group conducted surveillance at Fort Dix and Fort Monmouth in New Jersey, Dover Air Force Base in Delaware and the U.S. Coast Guard in Philadelphia. The co-conspirators obtained a detailed map of Fort Dix, where they hoped to use assault rifles to kill as many soldiers as possible, according to trial testimony and evidence.
During the trial, the jury viewed secretly recorded videotapes of the defendants performing small-arms training at a shooting range in the Pocono Mountains in Pennsylvania and watching training videos amongst themselves that included depictions of American soldiers being killed and of known foreign Islamic radicals urging jihad against the United States.
The defendants and the charges on which each was convicted are as follows:
- Mohamad Ibrahim Shnewer, 24, of Cherry Hill: conspiracy to murder members of the members of the U.S. military, and the attempted possession of AK-47 semi-automatic assault weapons to be used in the attack.
- Dritan Duka, 30 of Cherry Hill: conspiracy to murder members of the U.S. military; possession of machine guns; possession and attempted possession of machine guns in furtherance of a crime of violence; and two counts of possession of firearms by an illegal alien.
- Shain Duka, 28, of Cherry Hill: conspiracy to murder members of the U.S. military; possession of machine guns; possession and attempted possession of machine guns in furtherance of a crime of violence; and two counts of possession of firearms by an illegal alien.
- Eljvir Duka, 25, of Cherry Hill: conspiracy to murder members of the U.S. military, and possession of firearms by illegal aliens. The jury acquitted on one count of possession and attempted possession of machine guns in furtherance of a crime of violence.
- Serdar Tatar, 25, of Philadelphia: conspiracy to murder members of the U.S. military.
A sixth co-defendant, Agron Abdullahu, 26, of Buena Vista Township, Atlantic County, pleaded guilty before Judge Kugler on Oct. 31, 2007, to aiding and abetting the Duka brothers’ illegal possession of weapons. Abdullahu was arrested on May 7, 2007, along with the defendants convicted today. On March 31, 2008, Judge Kugler sentenced Abdullahu to 20 months in federal prison.
In determining the sentences, Judge Kugler consulted the advisory U.S. Sentencing Guidelines, which provide appropriate sentencing ranges that take into account the severity and characteristics of the offense, the defendant's criminal history, if any, and other factors. The judge, however, was not bound by those guidelines in determining a sentence.
Parole has been abolished in the federal system. Defendants who are given custodial terms must serve nearly all that time.
Marra and Kris credited the Special Agents of the FBI’s Philadelphia Division and the FBI South Jersey Joint Terrorism Task Force, under the direction of Special Agent in Charge Fedarcyk, in Philadelphia, for investigation of the case.
Marra, Kris, and Fedarcyk also thanked investigators with member agencies of the FBI South Jersey Joint Terrorism Task Force, which comprises ICE’s Philadelphia Division, under the direction of Special Agent in Charge John P. Kelleghan, the Camden County Prosecutor’s Office, under the direction of the Prosecutor Warren W. Faulk, NJ State Police, under the direction of Col. Joseph "Rick" Fuentes, Superintendent, and the Delaware River Port Authority Police, under the direction of Chief Dave McClintock, for their tireless efforts on the investigation.
Additionally, Marra, Kris, and Fedarcyk would like to thank the following agencies for their assistance and support: the U.S. military services at Fort Dix, Fort Monmouth, Dover Air Force Base, the U.S. Coast Guard in Philadelphia and the Naval Criminal Investigative Service, along with the Cherry Hill Police Department, Mt. Laurel Police Department, Cherry Hill Fire Department, Camden County Sheriff’s Department, Philadelphia Police Department, Pennsylvania State Police, the Burlington County Prosecutor’s Office, and N.J. Homeland Security.
Justice Department Settles Lawsuit to Enforce N.Y. Army Servicemembers Employment RightsRead the Press Release
The Department today has reached a settlement that, if approved by the U.S. District Court in Philadelphia, will resolve its lawsuit filed on behalf of Frantz Julien against Symphony Diagnostic Services Inc., doing business as MobilexUSA (Mobilex).
The complaint was filed in March 2009 and alleged that Mobilex violated the Uniformed Services Employment and Reemployment Rights Act (USERRA) by failing to reemploy Frantz Julien in either his mobile radiologic technician position or in a like position upon his honorable discharge from active duty in the U.S. Army. Under the terms of the settlement, which is embodied in a consent decree that has been submitted to the court, Mobilex is required to pay Julien a back pay award of $24,000 to compensate him for his lost earnings as a result of Mobilex’s actions.
"Employers must not evade their responsibilities to employees who return from honorable duty in the uniformed services," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "The Civil Rights Division works to vigorously uphold the rights of those who serve in the military to be free from violations of USERRA."
The Department’s lawsuit was filed after the Labor Department’s Veterans’ Employment and Training Service completed an investigation of Julien’s complaint.
The Civil Rights Division has given a high priority to the enforcement of service members’ rights under USERRA. Additional information can be found on the Web sites at www.servicemembers.gov and www.usdoj.gov/crt/emp.
Indiana Man Sentenced on Child Pornography ChargeRead the Press Release
James W. Dotts Jr., 33, of Georgetown, Ind., pleaded guilty today in New Albany, Ind., to one count of possession of child pornography and was sentenced to 37 months in prison and lifetimesupervised release following completion of his prison term.
During today’s plea and sentencing hearing before U.S. District Court Judge Richard L. Young, Dotts admitted to subscribing to a commercial child pornography Web site, and possessing visual depictions of prepubescent minors engaging in sexually explicit conduct.
This case was brought as part of an U.S. Department of Homeland Security Immigration and Customs Enforcement (ICE) nationwide investigation called "Operation Emissary," which targeted a Web site that offered images and movies of hardcore child pornography. The Web site alerted would-be customers that subscribing to the site was illegal and warned them to be discreet about their purchases.
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 against Dotts was prosecuted by Assistant U.S. Attorney Steven D. DeBrota of the Southern District of Indiana and CEOS Trial Attorney Bonnie L. Kane. The investigation was handled by ICE and CEOS’ High Technology Investigative Unit.
Defendant Sentenced to Life for Participation<br /> in International Child Exploitation EnterpriseRead the Press Release
James Freeman of Santa Rosa Beach, Fla., was sentenced to life in prison today for his activity in a global child pornography trafficking enterprise, Assistant Attorney General of the Criminal Division Lanny A. Breuer, U.S. Attorney for the Northern District of Florida Thomas F. Kirwin and FBI Executive Assistant Director Thomas J. Harrington announced.
Freeman, a registered sex offender, was found guilty following a six-day trial in January 2009 of six counts relating to his criminal activities as a member of the child exploitation enterprise. The charges alleged in these counts included engaging in a child exploitation enterprise; conspiracy to advertise, transport, ship, receive and possess child pornography; advertising, transporting and receiving child pornography and obstruction of justice.
Five of the defendants previously sentenced by Senior U.S. District Judge Lacey A. Collier: Daniel Castleman of Lubbock, Texas; Gary Lakey of Anderson, Ind.; Marvin Lambert of Indianapolis; Neville McGarity of Medina, Texas; and Ronald White of Burlington, N.C., also received life sentences. Five additional U.S. defendants also indicted in the case were sentenced on March 10, 2009.
According to evidence introduced at trial, the defendants were members of a highly sophisticated international network. The group was a well-organized criminal enterprise whose purpose was to proliferate child sex abuse images to its membership during a two-year period.
The defendants were found guilty of participating in an illegal organization that used Internet newsgroups - large file-sharing networks where text, software, pictures and videos can be traded and shared - to traffic in illegal images and videos depicting prepubescent children, including toddlers, engaged in various sexual and sadistic acts. Specifically, an Australian constable who infiltrated the group in August 2006 testified at trial about how group members employed a complex system of pseudonyms, screening tests for new members and sophisticated encryption methods to avoid detection. He also testified that the group traded more than 400,000 images and 1,000 videos of child sexual abuse before it was dismantled by law enforcement.
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 http://www.projectsafechildhood.gov./
The case is being prosecuted by Assistant U.S. Attorney David Goldberg of the Northern District of Florida and Trial Attorney LisaMarie Freitas of CEOS. The case is being investigated by the Innocent Images Unit of the FBI and the Queensland, Australia, Police Service, with the assistance of the Bundeskriminalamt (BKA) Child Pornography Unit in Germany and the Child Exploitation and Online Protection Centre in the United Kingdom.
Korean Executive Agrees to Plead Guilty and Serve One Year in Prison for Participation in LCD Price-Fixing ConspiracyRead the Press Release
WASHINGTON – A high-level Korean executive from LG Display Co. Ltd. (LG) has agreed to plead guilty and serve a year in jail in the United States for participating in a global conspiracy to fix prices in the sale of Thin Film Transistor-Liquid Crystal Display (TFT-LCD) panels, the U.S. Department of Justice announced today.
According to a one-count felony charge filed today in U.S. District Court in San Francisco, Bock Kwon, an executive of LG, conspired with employees from other TFT-LCD panel makers to suppress and eliminate competition by fixing the prices of TFT-LCD panels from on or about Sept. 21, 2001, to on or about June 1, 2006. During the charged conspiracy, Kwon, a citizen of the Republic of Korea, held several high-level positions at LG, including president of LG’s Taiwan subsidiary, vice president of notebook sales, vice president of sales planning, and executive vice president of sales and marketing. Under the plea agreement, which must be approved by the court, Kwon has agreed to serve a 12-month prison sentence in the United States and to pay a $30,000 criminal fine.
"The participants in the LCD conspiracy committed a serious fraud upon American consumers by fixing the prices of a product that is in almost every American home," said Christine A. Varney, Assistant Attorney General in charge of the Department’s Antitrust Division. "The charges against top-level executives who participated in the LCD conspiracy show the commitment of the Department of Justice to finding and prosecuting those at the highest levels, no matter where they live or where these crimes against American consumers were committed."
Including today’s charges, four companies and nine individuals have been charged in the Department’s ongoing antitrust investigation into the TFT-LCD industry. To date, more than $616 million in criminal fines have been imposed, or agreed to, as a result of this investigation, and four individuals have pleaded guilty and have been sentenced to serve jail time.
TFT-LCD panels are used in computer monitors and notebooks, televisions, mobile phones and other electronic devices. In 2006, the worldwide market for TFT-LCD panels was approximately $70 billion.
Kwon was charged with participating in a conspiracy that was accomplished by:
- Participating in meetings, conversations and communications in Taiwan, Korea and the United States to discuss the prices of TFT-LCD panels;
- Agreeing during these meetings, conversations and communications to charge prices of TFT-LCD panels at certain predetermined levels;
- Issuing price quotations in accordance with the agreements reached;
- Exchanging information on sales of TFT-LCD panels for the purpose of monitoring and enforcing adherence to the agreed-upon prices; and
- Authorizing, ordering and consenting to the participation of subordinate employees in the conspiracy.
On Dec. 15, 2008, LG pleaded guilty to participating in a worldwide conspiracy to fix the price of TFT-LCD panels and was sentenced to pay a $400 million criminal fine – the second-largest fine in Antitrust Division history. On Dec. 16, 2008, Sharp Corp. pleaded guilty to participating in three separate conspiracies to fix the prices of TFT-LCD panels sold to Dell, Apple Computer Inc. and Motorola Inc. and was sentenced to pay a $120 million criminal fine. On Jan. 14, 2009, Chunghwa Picture Tubes Ltd. (Chunghwa) pleaded guilty to participating in the same worldwide conspiracy as LG, and was sentenced to pay a $65 million criminal fine. On March 10, 2009, Hitachi Displays Ltd. was charged with participating in a conspiracy to fix the prices of TFT-LCD panels sold to Dell Inc. for use in desktop monitors and notebook computers from April 1, 2001, to March 31, 2004. Hitachi Displays Ltd. has agreed to plead guilty and pay a $31 million fine.
In February 2009, former Chunghwa CEO Chieng-Hon "Frank" Lin and two Chunghwa executives, Chih-Chun "C.C." Liu and Hsueh-Lung "Brian" Lee, pleaded guilty to and were sentenced for participating in the same conspiracy as LG and Chunghwa. Lin was sentenced to serve nine months in prison and pay a $50,000 criminal fine. Liu was sentenced to serve seven months in prison and pay a $30,000 criminal fine. Lee was sentenced to serve six months in prison and pay a $20,000 criminal fine. Also in February 2009, LG executive Chang Suk "C.S." Chung pleaded guilty for his role in the same conspiracy as LG and Chunghwa. Chung was sentenced to serve seven months in prison and pay a $25,000 criminal fine.
On Feb. 3, 2009, a federal grand jury in San Francisco returned an indictment against a former LG executive, Duk Mo Koo, and two former Chunghwa executives, Cheng Yuan Lin, aka C.Y. Lin and Wen Jun Cheng, aka Tony Cheng, for their participation in the same conspiracy as LG and Chunghwa. On March 31, 2009, a federal grand jury in San Francisco returned an indictment against Sakae Someya, an executive at Hitachi, for his participation in the same conspiracy as Hitachi.
Today’s charge is the result of a joint investigation by the Antitrust Division’s San Francisco Field Office and the FBI in San Francisco.
Anyone with information concerning illegal conduct in the TFT-LCD industry is urged to call the Antitrust Division’s San Francisco Field Office at 415-436-6660.
Iowa Man Convicted of Interfering withHousing Rights of African-American FamilyRead the Press Release
Justin Hanson, 21, of Mason City, Iowa, pleaded guilty today in federal court in Cedar Rapids to violating the civil rights of an African-American family.
In a plea agreement, Hanson admitted that on May 9, 2008, he placed a racially offensive sign in the yard of a neighboring African-American family and the next day he fired a B.B. gun into the victims’ home, breaking a bedroom window. By placing the sign and firing upon his victims, Hanson was attempting to injure, intimidate or interfere with the family’s enjoyment of their home. Hanson admitted he placed the sign in the yard and fired upon the house because of his neighbors’ race and because they were living in his "white" neighborhood, town and country.
Sentencing before U.S. District Court Chief Judge Linda R. Reade has been set for July 16, 2009. Hanson was convicted of one count of interfering with housing rights and faces a possible maximum sentence of 10 years’ imprisonment, a $250,000 fine, a $100 special assessment and three years of supervised release following any imprisonment.
The case was investigated by the FBI and the Mason City Police Department. The case is being prosecuted by the Justice Department Civil Rights Trial Attorney Kevonne Small and Assistant U.S. Attorney Forde Fairchild.
Houston Man Sentenced for Human Trafficking and Alien<br /> Smuggling ChargesRead the Press Release
Maximino Mondragon, 57, was sentenced today for his role in a scheme to smuggle Central American women and girls into the United States and to hold them in a condition of forced labor in the Houston area. U.S. District Judge Vanessa D. Gilmore sentenced Mondragon to 156 months incarceration, three years post release supervision, $200 special assessment and further ordered that he, jointly with his co-defendants, pay $ $1,715,588.05 in restitution to the victims.
Maximino Mondragon is the last of eight defendants to be convicted and sentenced in connection with this scheme to compel the victims into service in restaurants, bars and cantinas, using threats to harm the victims and their families if they attempted to leave before paying off their smuggling debts.
Mondragon previously pleaded guilty to violations of conspiracy to hold persons in a condition of indentured servitude and to illegally and knowingly recruiting, harboring, transporting persons for labor and services, and conspiracy to bring, harbor, and transport known illegal aliens for purposes of commercial advantage and private financial gain.
The defendants lured Central American women to the United States with promises of good jobs. However, once the young women arrived, they were forced to work in the defendants’ bars and cantinas selling high-priced drinks to male customers. The women were subjected to threats of harm to them and their families in order to compel their servitude.
"The defendant ruthlessly exploited these women’s hopes for a better life through coercion, false promises and threats of harm. The victims were forced into modern day slavery," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "The Justice Department will devote its efforts to prosecuting those who commit such abhorrent and exploitative crimes."
"The victims in this case were subjected to horrible treatment at the hands of these defendants," said Tim Johnson, Acting U.S. Attorney for the Southern District of Texas. "We will use every resource available to make certain that violations of this sort result in the maximum prison term available."
Co-defendants Oscar Mondragon and Walter Corea were also convicted of both conspiracy counts and each sentenced to prison terms of 180 months. Co-defendant Victor Omar Lopez was sentenced to 109 months in prison on both conspiracy counts. Co-defendant Olga Mondragon, who was convicted of multiple charges stemming from her involvement in these schemes to hold young Central American victims in a condition of forced labor and to smuggle the young women to the United States for financial gain, was sentenced to a prison term of 84 months. Co-defendant Maria Fuentes was convicted of harboring the young women for financial gain and sentenced to 30 months in prison. Co-defendant Lorenza Reyes-Nunez was convicted of obstruction of justice and has been sentenced to 19 months in prison. Co-defendant Kerin Silva was convicted of conspiracy to smuggle aliens and sentenced to 12 months’ home detention followed by three years of probation.
In announcing the sentencing, Acting Assistant Attorney General King and Acting U.S. Attorney Johnson commended the FBI, the Department of Homeland Security Security Bureau of Immigration and Customs Enforcement, the Texas Alcohol and Beverage Commission, the Harris County Constable Precinct Five Office, and the Human Trafficking Rescue Alliance, a federally funded multi-agency human trafficking task force, for their work on this cooperative investigation and prosecution.
Assistant U.S. Attorneys Ruben Perez and Joseph Magliolo and Civil Rights Division attorneys Jim Felte and Hilary Axam prosecuted this case for the government.
Five Charged in $70 Million Dream Home Mortgage Fraud SchemeRead the Press Release
WASHINGTON - A federal grand jury has indicted four defendants, and an information has been filed against a fifth defendant, for their participation in a massive mortgage fraud scheme that allegedly promised to pay off homeowners’ mortgages on their "Dream Homes," but left them to fend for themselves, Assistant Attorney General of the Criminal Division Lanny A. Breuer and U.S. Attorney for the District of Maryland Rod J. Rosenstein announced today.
The indictment was returned on April 22, 2009, and unsealed today.
"The Criminal Division and the U.S. Attorneys’ Offices are jointly committed to redoubling our efforts to uncover and prosecute fraud and abuse in all facets of the housing market – a market upon which so many American families have pinned their hopes and their futures for so many years," said Assistant Attorney General of the Criminal Division Lanny A. Breuer. "I want to assure the American public that we will not rest until the tide of this criminal activity is turned."
"The indictment alleges that the defendants used slick marketing to conceal empty promises," said U.S. Attorney Rod J. Rosenstein. "They convinced many victims to invest at least $50,000 by refinancing their existing homes or buying new homes at inflated prices, while claiming that Metro Dream Homes would repay the mortgages with revenue from profitable businesses. The indictment alleges that there was no revenue to pay the mortgage payments. Instead, the conspirators used some of the investors' money to repay earlier investors in the Ponzi scheme and spent the remainder on themselves."
"The effects of this wide-ranging mortgage fraud scheme are particularly disturbing within the backdrop of today’s economic environment. With our federal, state and local partners working on 18 mortgage fraud task forces and 47 mortgage fraud working groups across the country, the FBI is committed to combating mortgage fraud and other financial crimes nationwide to protect the American homeowner and the national economy," said Executive Assistant Director Thomas J. Harrington, FBI Criminal, Cyber, Response, and Services Branch.
"IRS Criminal Investigation takes allegations of mortgage fraud seriously," said "Eileen Mayer, Chief, IRS Criminal Investigation. "These types of crimes drive home owners into foreclosure, erode the integrity of our tax system and threaten the financial health of our communities."
According to the indictment, from 2005 to 2007 the defendants allegedly used corporate names such as "Metropolitan Grapevine LLC," "Metro Dream Homes," "POS Dream Homes," and "POS DH LLC" (collectively, MDH) to target homeowners and home purchasers to participate in a purported mortgage payment program called the "Dream Homes Program." To participate, an investor had to provide a minimum of $50,000 for each home enrolled in the program, in addition to an "administrative fee" of up to $5,000. In exchange, the program promised to make the homeowner’s future monthly mortgage payments, and pay off the homeowner’s mortgage within five to seven years. Thereafter, the homeowner and MDH would own an equal interest in the home.
The indictment alleges that Andrew Hamilton Williams, Jr., 58, of Hollywood, Fla., was the founder and owner of MDH; Michael Anthony Hickson, 46, of Commack, N.Y., was the chief financial officer; Isaac Jerome Smith, 46, of Spotsylvania, Va., was the president; and Alvita Karen Gunn, 31, of Hanover, Md., was the vice president of operations. The information alleges that Carole Nelson, age 50, of Washington, D.C., was the chief financial officer of POS Dream Homes.
The indictment further alleges that Dream Homes Program representatives explained to investors that the homeowners’ initial payments would be used to fund investments in automated teller machines (ATMs), flat-screen televisions that would show paid business advertisements, and "Touch-N-Buy" electronic kiosks that sold telephone calling cards and other items. To give the Dream Homes Program a veneer of legitimacy and financial success, the defendants marketed the program through live presentations at luxury hotels in Maryland, Washington, D.C., and Beverly Hills, Calif., among other locations. The defendants allegedly told some of the investors that they should not worry about the price of the homes or monthly mortgage payments because MDH would make mortgage payments on their behalf.
The indictment alleges that the defendants failed to advise investors that: the ATMs, flat-screen televisions and kiosks never generated any meaningful revenue; the defendants used the funds from later investors to pay the mortgages of earlier investors; and MDH had not filed any federal income tax returns throughout its existence. The defendants also allegedly failed to advise investors that their investments were being used for the personal enrichment of select MDH employees, including the defendants, to: pay salaries of up to $200,000 a year as well as their mortgages; employ a staff of 10 chauffeurs and maintain a fleet of luxury cars; and travel to and attend the 2007 National Basketball Association All-Star game and the 2007 National Football League Super Bowl, staying in luxury accommodations in both instances. Nor were investors told that investor funds were allegedly used to: pay off investors in a prior failed ATM investment venture that Williams had founded called Bankcard Group; make multiple donations of up to $50,000 each to charitable organizations to allegedly give MDH the appearance of being financially successful; and fund investments in third-party businesses that had not been disclosed to investors.
On Aug. 15, 2007, the Maryland Securities Commissioner issued a cease-and-desist order to Williams, MDH and other related companies directing them to immediately cease the offering and sale of unregistered securities in connection with their promotion of the Dream Homes Program. However, the defendants thereafter allegedly called additional meetings in which they made additional misrepresentations about the financial success of MDH’s operations. On Sept. 4, 2007, the defendants filed a legal challenge in federal court in Maryland to the cease-and-desist order. The indictment alleges that at a hearing on Sept. 12, 2007, Hickson testified that the financial success of the Dream Homes Program did not rely upon new investor funds, when in fact Hickson knew that the sole source of meaningful revenue for MDH was new investor funds.
As a result of the scheme, more than 1,000 investors in the Dream Homes Program invested approximately $70 million. When the defendants stopped making the mortgage payments, the homeowners were left to attempt to make the mortgage payments MDH had promised to make in full.
The four indicted defendants face a maximum sentence of 20 years in prison for the fraud conspiracy; 20 years in prison on each of the 15 counts of wire fraud; and 20 years in prison for conspiracy to commit money laundering. Hickson also faces a maximum sentence of five years in prison for making false statements. Smith also faces a maximum sentence of 30 years in prison for bank fraud arising out of his alleged misrepresentation of his income in order to obtain a bank loan to purchase a new Bentley automobile. Nelson was charged by information with money laundering, which carries a maximum penalty of ten years in prison. The indictment seeks forfeiture of the fraud proceeds, including $70 million.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceeding.
This prosecution is being brought jointly by the Maryland and Washington, D.C. Mortgage Fraud Task Forces, which are comprised of federal, state and local law enforcement agencies in Maryland, Washington, D.C. and Northern Virginia. The Task Forces were formed to promote the early detection, identification, prevention and prosecution of various kinds of mortgage fraud schemes. This case, as well as other cases brought by members of the Task Forces, demonstrates the commitment of law enforcement agencies to protect consumers from fraud and help to ensure the integrity of the mortgage market and other credit markets. Information about mortgage fraud prosecutions is available on the internet at http://www.usdoj.gov/usao/md/Mortgage-Fraud/index.html
Assistant Attorney General Lanny A. Breuer and U.S. Attorney Rod J. Rosenstein praised the FBI, IRS - CI, the Maryland Attorney General’s Office, Securities Division and the Federal Deposit Insurance Corporation, Office of Inspector General for their investigative work; and thanked Assistant U.S. Attorneys for the District of Maryland Jonathan C. Su and Bryan E. Foreman, who are prosecuting the case.
Colombian National Arraigned on Charges of Providing Material Support to the FARCRead the Press Release
WASHINGTON - A 32-year-old Colombian citizen, Luz Mery Gutierrez Vergara, who was extradited from the Republic of Colombia on Thursday, made her initial appearance today in federal court in Washington, D.C., to face charges for allegedly participating in a conspiracy to provide material support to the Fuerzas Armadas Revolucionarias de Colombia, commonly known as the "FARC," announced Jeffrey A. Taylor, U.S. Attorney for the District of Columbia, David S. Kris, Assistant Attorney General for the National Security Division, Jonathan I. Solomon, Special Agent in Charge of the Federal Bureau of Investigation ("FBI") Miami Field Office, Anthony V. Mangione, Special Agent in Charge of the Department of Homeland Security, U.S. Immigration and Customs Enforcement ("ICE") Miami Field Office, and Chris K. Amato, Special Agent in Charge of the Department of Defense, Defense Criminal Investigative Service ("DCIS") Southeast Field Office. Gutierrez Vergara was arraigned and pleaded not guilty to the charges against her.
In September of 2007, a federal grand jury in the District of Columbia indicted Gutierrez Vergara, along with a number of her co-conspirators, on two counts: conspiracy to provide material support or resources to a foreign terrorist organization and providing material support or resources to a terrorist organization. The indictment alleges that Gutierrez Vergara was involved in a conspiracy to assist the FARC by establishing and personally serving in a logistical support and supply network designed to procure weapons, ammunition, high technology devices, money, and other materials and supplies, and to transport and deliver these and other commodities, including hostages, to and among the FARC.
The FARC, an armed and violent organization in Colombia, has been designated by the United States as a foreign terrorist organization since 1997. The FARC has been involved in murders and hostage takings, and was responsible for holding three Americans – Marc D. Gonsalves, Thomas R. Howes and Keith D. Stansell – hostage from February 2003 until they were rescued in a Colombian military operation in July of 2008.
The FARC is divided into seven guerrilla blocs, which are further divided into fronts. Gutierrez Vergara is alleged to be affiliated with the First Front. The First Front is a large and trusted FARC logistical network which was controlled by Gerardo Antonio Aguilar Ramirez, also known as "Cesar." Colombian law enforcement apprehended Cesar during the daring July 2008 hostage rescue. Gutierrez Vergara was arrested by Colombian military and law enforcement officials in February of 2008. Throughout the investigation, Colombian law enforcement and prosecution authorities worked cooperatively with the FBI, ICE and DCIS.
In August of 2008, the United States filed a formal request with the Republic of Colombia seeking extradition on these charges. The extradition request was subsequently granted by the Colombian Supreme Court, and then by the Colombian Ministry of Justice and Colombian President Alvaro Uribe.
If convicted of the charges in the criminal indictment, Gutierrez Vergara faces a maximum of fifteen years' imprisonment.
In announcing the arrest, U.S. Attorney Taylor thanked Department of Justice Trial Attorney David P. Cora of the Counterterrorism Section of the Department of Justice, and Assistant U.S. Attorneys M. Jeffrey Beatrice and Anthony Asuncion, who are prosecuting this matter.
An indictment is merely a formal charge that a defendant violated a criminal law. All defendants are presumed innocent unless and until proven guilty.
Promoter of Fraudulent Tax Defiance Scheme Pleads Guilty to Mail FraudRead the Press Release
WASHINGTON - Jerry R. Williamson, a promoter of the American Rights Litigators/Guiding Light of God Ministries (ARL) formerly based in Florida, pleaded guilty today to mail fraud, the Justice Department and Internal Revenue Service (IRS) announced. Williamson appeared today before Judge Henry H. Kennedy Jr. in Washington, D.C., and admitted that he that he sent a fictitious "Bill of Exchange" purporting to be drawn upon the U.S. Treasury to the Bureau of Land Management of the Department of the Interior.
In September 2008, Williamson and four co-defendants, Eddie Ray Kahn, Stephen C. Hunter, Danny True and Allan J. Tanguay, were indicted by a federal grand jury and charged with conspiracy to defraud the United States and mail fraud. According to the indictment, the defendants sold worthless "Bills of Exchange" and promoted other schemes to orchestrate tax fraud.
The indictment further alleges that Kahn founded and led ARL from 1996 through 2004. During that time period, ARL enrolled more than 4,000 customers from all 50 states, the District of Columbia and several foreign countries. Defendants Hunter, True, Williamson and Tanguay allegedly worked at ARL with Kahn to develop and sell tax defiance schemes based on deliberate misrepresentations of the legal foundation of the tax system.
Judge Kennedy scheduled Williamson’s sentencing for Sept. 18, 2009. The trial for Kahn, Hunter, True and Tanguay is scheduled to begin in November 2009.
Acting Assistant Attorney General DiCicco of the Justice Department’s Tax Division commended the investigative efforts of the IRS agents involved in this case, as well as Tax Division attorneys Jeffrey McLellan, Kenneth Vert and Tino Lisella, who are prosecuting the case.
More information about the Justice Department’s Tax Division and its enforcement efforts is available at http://www.usdoj.gov/tax.
Owner of Korean Commercial Cargo Vessel & Chief Engineer Plead Guilty to Marine Pollution Related ChargesRead the Press Release
WASHINGTON—STX Pan Ocean Co. Ltd. (STX), headquartered in Seoul, Korea, and the owner of the commercial cargo ship, M/V Ocean Jade, pleaded guilty today to conspiracy as well as falsifying and failing to properly maintain records meant to ensure compliance with maritime pollution laws, the Justice Department announced. The chief engineer of the M/V Ocean Jade, Hong Hak Kang, a Korean citizen, also pleaded guilty today to failing to maintain environmental records and making false statements.
STX, which faces five years probation for each of the four counts against it, has agreed to pay a $2 million fine, as well as make a $200,000 community service payment to the National Fish and Wildlife Foundation. In addition, STX has agreed to implement a detailed environmental compliance plan, which requires monitoring of its fleet-wide operations over the course of four years.
Chief Engineer Kang faces maximum penalties of six years in federal prison, a $250,000 fine and three years of supervised release.
Federal and international law requires that all ships comply with pollution regulations that include the proper disposal of oily waste and sludge by passing the oily waste through an oil-water separator aboard the vessel or burning the sludge in the ship’s incinerator. In addition, federal law requires the ship’s crew to record accurately each transfer or disposal of oily waste and sludge in an oil record book.
Federal and international law also requires that ships record disposals of garbage in a garbage record book. Both record books must be available for inspection by the U.S. Coast Guard when the vessel is within the waters of the United States.
According to court documents, in late July 2008, Chief Engineer Kang ordered several crew members to dump approximately 10 barrels containing oily waste water directly overboard into the ocean. Chief Engineer Kang also made entries into the M/V Ocean Jade’s oil record book by applying a pre-established formula, rather than recording the actual amounts of oily waste and sludge transferred, burned or discharged. On Sept. 27, 2008, a senior officer instructed several members of the deck department to dispose of oily waste from the crane houses directly into the ocean using a flexible plastic hose that was draped over the side of the vessel. When the ship arrived in the Port of Tampa on Oct. 7, 2008, its officers presented false oil and garbage record books and several crew members provided Coast Guard investigators with false statements about the prior dumping incidents.
This case is being investigated by the U.S. Coast Guard, Coast Guard Investigative Service and the U.S. Environmental Protection Agency. It is being prosecuted by Cherie L. Krigsman, Assistant U.S. Attorney for the Middle District of Florida; Leslie E. Lehnert, Trial Attorney, Department of Justice, Environment and Natural Resources Division, Environmental Crimes Section; and Lieutenant William George, Coast Guard.
Maryland Man Pleads Guilty to Using a Nooseto Assault a Man at the PentagonRead the Press Release
William Michael King, a fifty-year-old truck driver from Maryland, pleaded guilty today to assault and violating the civil rights of an African American man he encountered while King delivered construction materials to the Pentagon.
King admitted that in October 2006, he made a noose and displayed it to the victim in an attempt to intimidate the victim. The victim, identified as "CS" in the charging documents, is a pipe fitter who also was working at the Pentagon in 2006. The United States also alleged that King placed the noose around the victim’s neck, and pulled the victim into a large, metal storage container. Sentencing is set for July 10, 2009.
"Every American has the right to a workplace free from racial intimidation and violence," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "The Justice Department is committed to ensuring that those who use racially motivated threats and violence in the workplace are prosecuted and brought to justice."
"A noose is a powerful symbol of hate and racially motivated violence," said Dana J. Boente, Acting U.S. Attorney for the Eastern District of Virginia. "As permitted by federal criminal law, we continue to aggressively prosecute those within our society who attack others because of the victim's race or color."
"The FBI has a zero tolerance policy against those who commit hate crimes or violate the civil rights of any citizen," said Joseph Persichini Jr., Assistant Director in Charge of the FBI’s Washington Field Office. "And as occurred here, when the facts come out such acts are often perpetrated by cowards who prey upon the innocent and unsuspecting."
The investigation was led by special agents of the FBI Washington Field Office with assistance from the Pentagon Force Protection Agency. Assistant U.S. Attorney Jonathan L. Fahey and Civil Rights Division Trial Attorney Michael J. Frank are prosecuting this case for the United States.
Justice Department Files Lawsuit Alleging Disability<br /> Discrimination by the City of Baltimore, MarylandRead the Press Release
WASHINGTON - The Justice Department today announced it has filed a lawsuit in U.S. District Court in Baltimore alleging that the city of Baltimore’s zoning code discriminates against individuals with disabilities by requiring substance abuse treatment facilities to go through a burdensome "conditional ordinance" zoning process in order to locate in any zone.
Other comparable facilities are not required to go through the conditional ordinance process, which requires approval by the Baltimore City Council and the local neighborhood association. Because of unfounded stereotypes about persons with disabilities who are in drug treatment, this process has resulted in facilities not getting a permit or in expending tremendous resources to get the permit.
"Persons with disabilities must not be subject to different, and more burdensome, zoning standards because of unfounded stereotypes," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "Drug treatment programs are vital to our nation’s health. We must not allow discrimination to prevent such programs for opening."
The Americans with Disabilities Act protects individuals with disabilities from discrimination in all activities of state and local government entities, including zoning and land use decisions. Additional information about the Civil Rights Division is available at the Justice Department Web site at www.usdoj.gov/crt.
Hurricane Katrina Contractor Accepts $4 Million Judgment Under the False Claims ActRead the Press Release
WASHINGTON – The United States has settled its claims filed under the False Claims Act against Lighthouse Disaster Relief and its partners, Gary Heldreth and Kerry Farmer. In its complaint, which was filed in the U.S. District Court for the Middle District of Louisiana, the United States alleged that Lighthouse, Heldreth, and Farmer accepted a $5.3 million payment for work that was not completely performed on a contract with the Department of Homeland Security.
The United States filed suit against Heldreth, Farmer and Lighthouse alleging that the defendants knowingly breached their contract to build and operate a basecamp to house and feed first responders who went to New Orleans to help with rescue and recovery efforts after Hurricane Katrina. The complaint alleged that the defendants made false statements to FEMA employees in order to be paid prematurely. The defendants then failed to build and staff a basecamp sufficient to house the number of first responders called for in their contract.
The settlement agreements require Heldreth, Farmer and Lighthouse to accept a judgment of $4 million less the approximately $1.3 million previously garnished by the government.
"This settlement demonstrates that the United States will aggressively pursue those who exploit the taxpayers in times of disaster,"said Tony West, Assistant Attorney General for the Civil Division.
"Protecting disaster relief funds from fraud, waste or abuse of any kind has been, and remains, a top priority of this office and of the Hurricane Katrina Fraud Task Force" said David R. Dugas, U.S. Attorney for the Middle District of Louisiana and Executive Director of the National Center for Disaster Fraud. "This settlement is part of the ongoing efforts to ensure that disaster relief funds are not improperly diverted from their intended, and critically important, purpose."
This investigation and litigation was conducted by the U.S. Attorney’s Office for the Middle District of Louisiana, the Civil Division of the U.S. Department of Justice, with the assistance of the Office of Inspector General of the Department of Homeland Security.
The Civil Division of the U.S. Department of Justice, the U.S. Attorney’s Office for the Middle District of Louisiana and the Office of Inspector General for the Department of Homeland Security are members of the Justice Department’s Hurricane Katrina Fraud Task Force.
Cast Iron Pipe Manufacturer Sentenced for Environmental Crimes and Worker Safety ViolationsRead the Press Release
WASHINGTON—Atlantic States Cast Iron Pipe Co. a Phillipsburg, N.J.-based division of McWane Inc. of Alabama was sentenced today to pay a fine of $8 million for violations of environmental and worker safety laws as well as obstructing the federal investigation of its conduct, the Justice Department announced.
U.S. District Judge Mary L. Cooper for the District of New Jersey also sentenced the company to serve four years of probation, during which it will be subject to oversight by a court-appointed monitor. The monitor, who has yet to be named, will report twice annually to the court on the company’s lawful operation and adherence to environmental and worker health and safety regulations.
Judge Cooper also required an additional condition of probation that specific top managers at the Phillipsburg plant and at McWane headquarters in Birmingham, Ala. – including the chairman and president – read the entire transcripts from the sentencings this week of the four managers who were convicted along with the company.
The sentencing of the company followed sentencings this week of four former Atlantic States managers to federal prison terms. Those sentences were: 70 months for former plant manager John Prisque; 41 months for former human resources manager Scott Faubert; 30 months for former maintenance superintendent Jeffrey Maury; and six months for former Atlantic States finishing department head Craig Davidson.
"These sentences mete out just punishment for the company and its employees’ disregard of the law which was demonstrated during the longest environmental crimes trial in this country’s history for multiple violations of worker safety and environmental protection laws," said Associate Attorney General Thomas Perrelli. "This case should serve as an example for company execs and plant operations managers —ignoring environmental laws and disregard for workers’ lives and limbs will be met with prosecution and stiff sentences including multi-million dollar fines and prison time."
"We are gratified," said Ralph J. Marra, Jr., Acting U.S. Attorney for the District of New Jersey, "that just punishment has been imposed and we hope these sentences tell McWane one thing in no uncertain terms: once and for all end the practices that have been so destructive to workers, their families and the environment."
"These sentences show that senior managers, as well as companies, will be prosecuted when they break the law," said Catherine McCabe, Acting Assistant Administrator for EPA’s Office of Enforcement and Compliance Assurance. "The managers had an obligation to run the facility safely and legally; instead, they committed environmental crimes that polluted the air and water."
"The jail time imposed against the Atlantic States managers and the $8 million fine imposed on the company send a clear message of zero tolerance to employers who choose to disregard their basic, legal obligation to protect the safety and health of their workers," says Robert D. Kulick, OSHA Regional Administrator in New York. "OSHA will continue to take action, alone and in partnership with other agencies, to bring to justice those companies and executives who blatantly violate worker safety and health laws and endanger their employees."
"Some people don’t think environmental crimes are as significant as public corruption, fraud or violence," said Weysan Dun, Special Agent in Charge of the FBI in Newark, N.J. "Well, I want the public to know that we at the FBI take violations of our environmental laws very seriously because they impact our communities both now and in years to come. I offer my congratulations to all of our partners in this case."
Following a seven-month trial, a jury on April 26, 2006 convicted Atlantic States and the four managers of engaging in an eight-year conspiracy to pollute the air and Delaware River in violation of the Clean Air and Clean Water Acts, expose its employees to dangerous conditions, and impede and obstruct federal regulatory and criminal investigations. A fifth defendant was acquitted at trial.
The jury verdicts affirmed the government’s charges that Atlantic States and the managers regularly discharged oil and other pollutants into the Delaware River, willfully polluted the air and rigged emissions tests, concealed serious worker injuries from health and safety inspectors, and maintained a dangerous workplace that contributed to multiple injuries, including severe burns, broken bones and amputations and the death of one employee at the Phillipsburg plant. The company and individual defendants also were convicted of obstructing environmental and worker safety investigations.
The convictions then represented the fifth time in two years that a McWane division either pleaded guilty or was convicted in federal court of environmental and worker safety crimes and obstruction. The notorious practices at the plant, in which worker health and safety and reasonable environmental protections were sacrificed for the goal of maximum production and profits, became known as the "McWane Way" at the Phillipsburg and other McWane plants in the U.S. and Canada.
The company and each of the defendants were convicted of the main conspiracy count in a 34-count indictment. Atlantic States was convicted of a total of 32 of 34 counts, which also included five counts of making materially false statements to state and federal environmental agencies and the federal OSHA; four counts of obstructing OSHA investigations; and 22 counts of violating the Clean Water Act and one count of violating the Clean Air Act.
The privately held McWane Inc. and its divisions are among the largest manufacturers in the world of ductile iron pipe with more than a dozen plants in the United States and Canada. McWane’s products are used primarily for municipal and commercial water and sewer installations.
The case was prosecuted by Ralph J. Marra Jr., Acting U.S. Attorney for the District of New Jersey, Norv McAndrew, former Assistant U.S. Attorney, Andrew Goldsmith Senior Trial Attorney and First Assistant Chief for the Justice Department’s Environmental Crimes Section and Deborah Harris, Senior Trial Attorney from the Environmental Crimes Section.
The case was investigated by special agents of the EPA, under the direction of William V. Lometti, Special Agent in Charge of EPA’s Criminal Investigation Division in New York; staff of OSHA’s Avenel, N.J. office, under the direction of Robert D. Kulick, OSHA Regional Administrator in New York; the New Jersey Department of Environmental Protection, under the direction of Commissioner Mark N. Mauriello; special agents of the FBI, under the direction of Special Agent in Charge Weysan Dun in Newark; the New Jersey Department of Law and Public Safety, Division of Criminal Justice, under the direction of Attorney General Anne Milgram; and the Phillipsburg Police Department.
Attorney General Eric Holder Announces $100 Million in Recovery Act Funds for Victims Assistance and CompensationRead the Press Release
WASHINGTON – Attorney General Eric Holder announced today that the Department of Justice is beginning the process of awarding $100 million in Recovery Act funds to victim assistance and compensation programs. The Attorney General made the announcement in his remarks at the National Crime Victims’ Rights Week Awards Ceremony where he recognized 10 individuals and programs for their service to crime victims.
Of the $100 million in Recovery Act funds, the Department of Justice will begin the process of distributing $95 million through state formula grants to victim assistance and compensation programs today. In addition to these grants, the Department will award an additional $5 million in Recovery Act discretionary funds to provide training and technical assistance and to support demonstration programs in areas ranging from child abuse to sexual assault to victim services in corrections later this year. State allocations can be found at: http://www.ojp.usdoj.gov/ovc/fund/recoverycvfa2009.html
"We all owe a debt to these honorees and to the countless other advocates across the country who tirelessly work to protect victims’ rights," Attorney General Eric Holder said. "The Department of Justice is committed to fighting for victims’ rights, which is why I’m so pleased we’ve been able to dedicate such a substantial amount of funds from the Recovery Act to assist such advocates in their invaluable work."
These annual awards are presented as a prelude to the nation’s observance of National Crime Victims’ Rights Week, April 26-May 2, 2009. This year’s theme—"25 Years of Rebuilding Lives: Celebrating the Victims of Crime Act"—highlights the important role this law has played in serving victims.
The Victims of Crime Act was passed in 1984 and one of the innovative aspects of this landmark legislation was the Crime Victims Fund. Fines and penalties from federal criminals—not tax dollars—are paid into the fund to support victim assistance and compensation programs. Since 1984, more than $6.9 billion from the Crime Victims Fund has been distributed. Today, 4,200 local organizations provide counseling, courtroom advocacy, temporary housing and other services to crime victims. The Fund also has been used to aid victims of mass casualty violence, including the shootings at Virginia Tech and at the American Civic Association in Binghamton, N.Y.
The fund is administered by the Department’s Office of Justice Programs (OJP) through its Office for Victims of Crime (OVC), which organized today’s awards ceremony and the Candlelight Observance held yesterday in Washington, D.C. In addition to the Attorney General, others at the Candlelight Observance included: Lanny Breuer, Assistant Attorney General, Criminal Division; Laurie O. Robinson, Acting Assistant Attorney General, OJP; Joye E. Frost, Acting Director, OVC; and Quincy A. Lucas, a victims advocate and founder of Witney’s Lights Inc.
The recipients of today’s awards were nominated by their colleagues in the victim service and criminal justice fields to recognize their courageous responses in the aftermath of a crime and their professional efforts to better serve the needs of victims with disabilities, to design and implement curricula and tools for victim service providers and to ensure that victims receive the services that they need.
National Crime Victim Service Award: Honors extraordinary efforts in direct service to crime victims.
Recipient: The Boston Area Rape Crisis Center (BARCC), Boston, Mass., for establishing itself as a model program for other rape crisis centers across the country, many of which have incorporated BARCC’s programs, partnerships and trainings into their programs.
Recipient: Kenneth Barnes, Washington, D.C., for his dedication following his son’s violent death to reducing gun violence and its devastating impact on families and communities. Mr. Barnes founded Reaching Out to Others Together (ROOT) in 2002 to advocate, educate and intervene on behalf of homicide victims, as well as to motivate and mobilize communities to take proactive measures to reduce gun violence crimes.
Award for Professional Innovation in Victim Services: Recognizes a program, organization or individual that has helped to expand the reach of victims’ rights and services.
Recipient: Lafourche Parish Sheriff’s Office, Police Social Services (PSS), Thibodaux, La., for their commitment to coordinated community responses with advocates, counselors, prosecutors, social workers and the judicial system by going to great lengths to ensure that victims of crime are given immediate and long-term assistance. PSS provides crisis intervention from first response throughout the criminal justice process and serves 1,200 to1,400 victims per year.
Team members include: Lt. Karla S. Beck, Deanna Dufrene, Sgt. Valerie Day, Deputy Dale Savoie, Deputy Walter Tenney, Deputy Delaune Boudreaux, Advocate Tamera Joseph, Deputy Rebecca Shaver, Deputy Amy Guillot, Deputy Pam Guedry and Reservist Bernard Lafaso.
Volunteer for Victims Award: Honors individuals for their uncompensated efforts to reach out to victims.
Recipient: Barbara Ann Skudlarick, Blaine, Wash., for her volunteer work serving victims of crime since 1997, including her instrumental efforts to bring victim services to her community. Ms. Skudlarick, a retired R.N. and a retired flight attendant, also served as a member of the Aviation Family Support Team and flew to Washington, D.C. after the Sept. 11, 2001 attacks, to support surviving family members of those who were killed in the attack on the Pentagon.
Special Courage Award: Recognizes extraordinary bravery in the aftermath of a crime or courageous act on behalf of a victim or potential victim.
Recipient: Gracia Burnham, Rosehill, Kan., who served with her husband Martin as missionaries with the New Tribes Mission in the Philippines for more than 15 years. In May 2001, the couple decided to spend a night at the Dos Palmas Island Resort in the Palawan area of the Philippines to celebrate their 18th wedding anniversary. They were awakened by armed gunmen affiliated with the terrorist organization Abu Sayyaf Group (ASG). The Burnhams were among 20 hostages seized that morning and forced into a waiting motorboat. Throughout their terrifying ordeal which lasted more than a year they both exhibited remarkable strength and courage. On June 7, 2002, members of the Armed Forces of the Philippines found their encampment and a firefight ensued in which Mr. Burnham was killed and Mrs. Burnham was shot in the leg, but survived and was rescued. Since that time, Mrs. Burnham has dedicated herself to pursuing justice against the terrorists who held them captive.
Allied Professional Award: Recognizes an individual or organization outside the victim assistance field for services or contributions to the victims’ field.
Recipient: Daniel Man, M.D., Boca Raton, Fla., for his work on a unique model program that helps physically injured victims of domestic violence restore their lives by reconstructing battered faces mutilated by acts of violence.
Ronald Wilson Reagan Public Policy Award: Honors an individual whose leadership, vision and innovation results in significant changes to public policy and practice benefiting crime victims.
Recipient: William Van Regenmorter, Hudsonville, Mich., for authoring the Michigan Victims Bill of Rights Constitutional Amendment, which became law in 1988, as well as successive victim-related legislation. He also is the founder of the Michigan Crime Victim Foundation, which serves as a financial resource of last resort for victims who lack insurance or do not qualify for victim compensation. Mr. Van Regenmorter, a retired state legislator, is considered by many to be the "Father of Victims’ Rights" in the state of Michigan.
Federal Service Award: Honors exceptional contributions and extraordinary impact on behalf of victims in Indian Country, on military installations, in national parks or in other areas governed by federal jurisdiction.
Recipient: U.S. Immigration and Customs Enforcement, Senior Management Team, Washington, D.C., for recognizing the critical role that victims of crime play in the federal criminal justice process and embracing a victim-centered approach to investigations. Team members include: Marcy Forman, Raymond Parmer, Jr., James Hayes, William Reid, Michael H. Neifach, Gary W. Schenkel, Traci Lembke, Roger Applegate and Brian Moskowitz.
Recipient: Frank Marion, U.S. Postal Inspection Service, Washington, D.C., for 35 years of unwavering commitment and support to thousands of crime victims with information, referrals and support within the federal justice system.
Crime Victims Fund Award: Recognizes outstanding work in pursuit of federal criminal offenders and in the collection of fines, penalty fees, forfeited bail bonds and special assessments that constitute the Crime Victims Fund and victim restitution.
Recipient: U.S. Attorney’s Office, Eastern District of North Carolina, Financial Litigation Unit, Raleigh, N.C., for helping to restore victims’ rightful ownership from what has been taken away, lost or surrendered from federal criminal defendants. Team members include: S. Katherine Burnette, Sarah Aman, Margaret Davis, Claire Farland, Charlene Harris and David Stearns.
More information about National Crime Victims’ Rights Week, the Crime Victims Fund, and victim assistance and compensation programs is available at: www.ojp.gov.
Kansas Man Charged with Immigration Crimes in Connection with 1994 Genocide in RwandaRead the Press Release
WASHINGTON - Lazare Kabaya Kobagaya, 82, of Topeka, Kan., was arrested today on charges of naturalization fraud and misuse of an alien registration card, Assistant Attorney General Lanny A. Breuer of the Criminal Division, Acting U.S. Attorney Marietta Parker for the District of Kansas and U.S. Immigration and Customs Enforcement (ICE) Acting Assistant Secretary John P. Torres announced.
According to the indictment, Kobagaya allegedly participated in genocidal activities during the 1994 Rwandan conflict including mobilizing attackers to commit arson and murder. Kobagaya is alleged to have failed to disclose his alleged participation in these activities during his immigration and naturalization processes.
A grand jury in Wichita, Kan., returned a sealed indictment against Kobagaya on Jan. 13, 2009, charging him with one count of unlawful procurement of naturalization and one count of misuse of an alien registration card. The indictment also notifies Kobagaya that he is subject to automatic revocation of his citizenship if convicted for unlawful procurement of naturalization. The indictment was unsealed today after his initial appearance before a federal magistrate judge.
If convicted of unlawful procurement of citizenship, Kobagaya faces a maximum of 10 years in prison as well as automatic revocation of his U.S. citizenship and a fine of up to $250,000. If convicted of fraud and misuse of an alien registration card, he faces a maximum of 10 years in prison and a fine of up to $250,000.
Kobagaya is scheduled to appear before Magistrate Judge Donald Bostwick of the U.S. District Court for the District of Kansas on April 24, 2009, at 10:00 a.m. CDT for his initial appearance.
The case is being prosecuted by Senior Trial Attorneys Michael E. Barr, Christina P. Giffin and Steven C. Parker from the Criminal Division’s Office of Special Investigations (OSI) and Assistant U.S. Attorney Alan Metzger for the District of Kansas. The investigation is being handled jointly by OSI and ICE.
The charges in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Individual Charged with Participating in Scheme to Steal Large Quantities of Fuel from U.S. Army in IraqRead the Press Release
WASHINGTON – A federal grand jury returned an indictment today charging Robert Jeffery, 55, with conspiracy and theft of government property in connection with a scheme to steal large quantities of fuel from the U.S. Army in Iraq, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division and Acting U.S. Attorney Dana J. Boente for the Eastern District of Virginia.
According to the two-count indictment, from October 2007 through May 2008, Jeffery, a U.S. citizen residing in the Philippines, 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 allegedly presented false fuel authorization forms to steal large quantities of aviation and diesel fuel from the VBFP for subsequent sale on the black market. 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. According to court documents, the United States owns and operates the VBFP in support of Operation Iraqi Freedom. The VBFP supplies aviation fuel and diesel fuel to both military units and U.S. government contractors operating in and around the VBFP.
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 theft of government property count carries a maximum penalty of 10 years in prison and a fine of the greater of $250,000 or twice the value gained or lost.
In a related case, Lee William Dubois pleaded guilty on Oct. 7, 2008, to participating in a scheme to steal fuel worth approximately $39.6 million from the U.S. Army in Iraq. 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 June 18, 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 Attorney Andrew Gentin. 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.
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.
Texas Man Pleads Guilty on Federal Civil Rights ChargesRead the Press Release
WASHINGTON – Brandit Franco, 33, a former deputy with the Bexar County Sheriff’s Office, pleaded guilty to a civil rights charge today in federal court in San Antonio, Texas, for using excessive force against a prisoner while working as a detention officer at the county jail, the Justice Department announced. Franco faces a maximum term of imprisonment of 10 years and a fine of $250,000. A sentencing hearing is set for July 24, 2009.
According to documents filed in court, Franco acknowledged that on the evening of Oct. 18, 2006, he willfully used more force than was necessary when he responded to noisy prisoners inside of a locked holding cell by entering the cell and striking a pretrial detainee. As a result of Franco’s assault, the prisoner sustained injuries to his head that necessitated medical treatment. By pleading guilty, Franco acknowledged that he deprived the prisoner of his constitutional right not to be deprived of liberty without due process, which includes the right to be free from the use of excessive force by a law enforcement officer.
"Law enforcement officers take an oath to uphold the law, not to violate it, as this officer did when he abused his authority over a man in his custody," said Acting Assistant Attorney General Loretta King of the Civil Rights Division.
The FBI investigated this case, and it was prosecuted by Gerard V. Hogan and James D. Walsh with the Justice Department’s Civil Rights Division.
Maryland Commercial Fisherman Sentenced to Prison for Illegal Harvesting of RockfishRead the Press Release
WASHINGTON—Thomas L. Hallock, a commercial fisherman licensed in Maryland, was sentenced today in U.S. District Court in Greenbelt, Md., to 12 months in prison, for illegally overfishing striped bass also known as rockfish, the Justice Department announced.
He was also fined $4,000 and ordered to pay restitution in the amount of $40,000 to the National Fish and Wildlife Foundation to the benefit of the Chesapeake Bay Striped Bass Restoration Account.
"Today’s prison sentence should serve as a warning to fishermen and wholesalers who may consider undercutting the market and risking the continuation of the striped bass population. You will be prosecuted and you face the possibility of serving time," said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. "Fishing limits in the Chesapeake Bay and Potomac River are designed to protect the healthy sustainable population of striped bass and ensure a viable fishery up and down the eastern seaboard."
"If fishermen obey the rules, the rockfish population can be sustained forever," said Rod J. Rosenstein, U.S. Attorney for the District of Maryland. "If we allow overfishing, the rockfish population could be wiped out very quickly."
Hallock of Catharpin, Va., pleaded guilty on Feb. 19, 2009, to falsely recording the amount of striped bass that he harvested from 2003 to 2007 with the assistance of a Maryland designated fish check-in station. In each year, he failed to record some of the striped bass that was caught or recorded a lower weight of striped bass than was actually caught. Hallock and the check-in station operator would also falsely inflate the actual number of fish harvested. By under-reporting the weight of fish harvested, and over-reporting the number of fish taken, the records would make it appear that the defendants had failed to reach the maximum poundage quota for the year, but had nonetheless run out of tags. As a result, the state would issue additional tags that could be used by the defendants allowing them to catch striped bass above their maximum poundage quota amount. Hallock admitted to overfishing 68,442 pounds of rockfish that had a fair market retail value of $342,210.
In a related matter, charges were filed on April 20, 2009, against the fish wholesaler and its owner who operated the check-in station that assisted Hallock and others in violating the law. Golden Eye Seafood LLC and owner, Robert Lumpkins of St. Mary’s County, Md., were charged with four felony counts including conspiracy to violate the Lacey Act and three substantive violations of the Act. According to the charging document, Golden Eye Seafood and Lumpkins also purchased fish that were outside the legal size limit from an undercover agent and sold those fish to purchasers in New York, Virginia, and California.
Golden Eye and Lumpkins also conspired to falsely record and verify lower weights of and higher numbers of the commercially harvested rockfish than were actually being caught. By increasing the number of fish allegedly checked-in and decreasing the weight, the defendants made it appear as if they and other Maryland fisherman were using more tags and catching lower weights of fish. They in turn would request more tags as it appeared they had not reached their poundage quota.
Additionally, John Evans, a commercial fisherman who operated in St. Mary’s County and the surrounding waters of the Chesapeake Bay, was charged with a violation of the Lacey Act for overfishing striped bass.
The charges contained in the criminal information are not a finding of guilt. An individual charged by criminal information is presumed innocent unless and until proven guilty in a court of law. The Lacey Act carries a maximum penalty of five years in prison and a fine of up to $250,000 per offense.
Sentencing dates for the remaining six commercial fishermen who have pleaded guilty to similar charges as Hallock are listed below.
Charles Quade, April 27, 2009, 9:30 AM
Thomas L. Crowder, April 28, 2009, 9:30 AM
John W. Dean, April 30, 2009, 9:30 AM
Keith A. Collins, May 28, 2009, 9:30 AM
Kenneth Dent, July 2, 2009, 9:30 AM
Jerry Decatur, Sr., July 1, 2009, 9:30 AM
Cannon Seafood, a Washington, D.C., fish wholesaler, its owner, Robert Moore Sr. and his son Robert Moore Jr. are scheduled for sentencing on May 8, 2009, at 9:30 AM in U.S. District Court for the District of Columbia. Two fishermen, Joseph Peter Nelson Jr. of Great Mills, Md., and his father Joseph Peter Nelson of Avenue, Md., have been indicted in the District of Maryland and are awaiting trial.
As a result of the investigation and prosecution, two fish wholesalers and a total of 14 individuals have been charged, including today’s defendants.
The case is being prosecuted by Assistant U.S. Attorney Stacy Dawson Belf for the District of Maryland and Senior Trial Attorney Wayne Hettenbach of the Justice Department’s Environmental Crimes Section.
Justice Department Settles Lawsuit Against Grand Forks County, North Dakota, to Enforce the Employment Rights of North Dakota Army National Guard MemberRead the Press Release
WASHINGTON – The Justice Department today announced that it has reached a settlement that will resolve its lawsuit filed against Grand Forks County, N.D., on behalf of Suzanne L. Halverson in accordance with the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA), if approved by the U.S. District Court in Fargo. USERRA prohibits employment discrimination against individuals because of their service in the uniformed services.
The complaint, filed in January 2009, alleged that Grand Forks County violated USERRA by taking into consideration Ms. Halverson’s military service obligations when it denied her promotion to a permanent juvenile detention officer position in the county’s correctional center. Under the terms of the settlement, which is called a consent decree, Grand Forks County is required to pay Ms. Halverson, who is no longer working at the correctional center, a monetary award of $20,000 for lost wages.
"No person should fear being penalized in their civilian careers because they serve in the military," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "This consent decree demonstrates the Department’s commitment to the vigorous enforcement of federal laws that protect the employment rights of men and women who serve in the military."
The Department’s Civil Rights Division places a high priority on the enforcement of service-members’ rights under USERRA. Additional information about USERRA can be found on the Justice Department Web sites: www.servicemembers.gov and www.usdoj.gov/crt/emp .
Former Manager of Michigan Wastewater Treatment Company Sentenced to Prison for Illegally Discharging Untreated Liquid WastesRead the Press Release
WASHINGTON— Michael Panyard, the former general manager of Comprehensive Environmental Solutions Inc. (CESI), a company that operates an industrial waste treatment and disposal facility in Dearborn, Mich., was sentenced today to 15 months in prison by U.S. District Court Judge Victoria A. Roberts of the Eastern District of Michigan, the Justice Department announced. He was also sentence to two years of supervised release and was ordered to participate in a comprehensive drug treatment program.
Panyard of Pleasant Ridge, Mich., was convicted following a three week trial in October 2008, of nine counts, including one conspiracy count, two counts of violating the Clean Water Act and six counts of making false statements in connection with illegal discharges of millions of gallons of untreated liquid wastes from the facility.
Charles Long of Brownstown, Mich., also a former plant manager, was convicted of conspiracy and a Clean Water Act violation. Earlier this month Long was sentenced to 24 months in prison followed by two years supervised release. Bryan Mallindine of Carlsbad, Calif., the former chief executive officer, was convicted of one count of negligently bypassing the facility’s required pretreatment system, a misdemeanor violation of the Clean Water Act. In March 2009, he was sentenced to three years probation, including three months home confinement. Another former plant manager, Don Kaniowski, also was sentenced in March to three years probation following his plea to a felony Clean Water Act violation. Kaniowski provided substantial assistance to the government in the course of its investigation.
According to the evidence presented during the trial, CESI had a permit to treat liquid industrial waste brought to the facility from throughout the Midwest and Canada, through a variety of processes, and then discharge it into the Detroit sanitary sewer system. Liquid industrial wastes were stored at the facility in twelve large above-ground tanks capable of holding more than 10 million gallons.
During the period from January 2001 to June 2002, facility employees routinely bypassed the facility’s treatment system in order to discharge untreated liquid wastes directly into the sanitary sewer system. During most of this time, the facility had no operable equipment to treat incoming liquid wastes and the 10 million gallon tank farm was full with virtually no capacity to store additional liquid wastes. Nonetheless, the facility continued to accept more than 16 million gallons of liquid industrial waste-streams for purported treatment and disposal. Because the facility had no space available for this additional waste, nor equipment to treat it, company employees discharged nearly 13 million gallons of untreated liquid waste into the sanitary sewer in violation of the Clean Water Act, the facility’s permit, and the consent order under which the facility operated.
Evidence at trial further showed that the defendants took steps to conceal the lack of treatment from customers and regulatory officials, including Detroit Water and Sewerage Department personnel, through false statements and tampering with legally required compliance samples.
"Self-regulation is the backbone of all of our environmental compliance programs, including our Clean Water Act pretreatment and National Pollution Discharge Elimination System permit programs," said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. "Without good faith efforts at compliance with pretreatment requirements and honest reporting when violations occur, even our best efforts at preserving our nation’s waters ultimately will fail. The sentences imposed in this case emphasize the powerful deterrent value of criminal enforcement efforts aimed at ensuring compliance with laws and regulations designed to protect the environment."
Terrence Berg, U.S. Attorney for the Eastern District of Michigan said, "The Clean Water Act protects our waters from being dumping grounds for untreated waste. Today’s sentencing demonstrates that the government or public will not tolerate those who choose to commit environmental crimes. My office will continue to aggressively prosecute the intentional pollution of one of Michigan’s most sacred natural resources."
"The defendant made the decision to risk harming the environment and then lied about it, all in an effort to ‘cut corners’ and make illegal profits," said Randy Ashe, Special Agent in Charge of Environmental Protection Agency’s Criminal Investigation Division in Chicago. "His sentence is a clear reminder that managers of companies, as well as the company itself, will be prosecuted when they commit environmental crimes."
On Sept. 4, 2008, CESI pleaded guilty to related charges and agreed to pay a fine of $600,000 plus an additional $150,000 to fund a community service project for the benefit, preservation and restoration of the environment and ecosystems in the waters adjoining the Rouge River and the Detroit River. In addition to accepting responsibility for its past misconduct, CESI, which is under new management, has taken a number of steps during the last several years to install new equipment and systems to treat liquid industrial waste before it is discharged to the sewer.
As a condition of probation, CESI has agreed to abide by the terms of a consent order with the Michigan Department of Environmental Quality for the cleanup of the facility, at an estimated cost of about $1.5 million that includes the proper disposal of the liquid waste previously stored in the facility’s tank farm. CESI has further agreed to develop, adopt, implement and fund an environmental management system/compliance plan at its facility. This will include an annual program to train employees on environmental compliance and ethics, to ensure that all CESI employees understand the requirements imposed by the facility’s discharge permit.
The company, the last defendant to be sentenced in the case, has a hearing scheduled for May 11, 2009 at 2 P.M.
The case was investigated by special agents of the EPA Criminal Investigation Division, with the assistance of the Federal Bureau of Investigation, as a part of the Detroit Multi Agency Environmental Crimes Task Force. The case is being prosecuted by Assistant U.S. Attorney Mark Chutkow, Senior Counsel James Morgulec of the Justice Department’s Environment and Natural Resources Division and EPA Regional Criminal Enforcement Counsel David Mucha.
Federal Court Shuts Down Dallas Tax PreparerRead the Press Release
WASHINGTON - A federal court in Dallas has permanently barred a Garland, Texas, man from preparing federal tax returns for others. Lucky Ngo, who operated "Lucky’s Translation and Tax Service" and "Water Inn," prepared over 6,100 federal tax returns for customers since 2004, according to the government complaint filed in the civil injunction case. Ngo agreed to the permanent injunction order.
The government lawsuit alleged that Ngo had a long history of preparing false tax returns claiming improper deductions for non-deductible personal expenses. According to the complaint, Internal Revenue Service (IRS) officials twice met with Ngo and explained to him that the deductions he was claiming were improper, but Ngo continued to claim improper deductions. Ngo’s conduct allegedly caused over $9.6 million dollars in harm to the United States.
"The Justice Department and Internal Revenue Service are working together closely to shut down tax preparers who refuse to comply with the tax laws," said John DiCicco, Acting Assistant Attorney General for the Justice Department’s Tax Division.
DiCicco thanked Grayson Hoffman, the Justice Department trial attorney who handled the case, and Chris Hendrix, a revenue agent with the IRS’s Small Business/Self-Employed Division, who conducted the investigation.
Since 2001, the Justice Department’s Tax Division has obtained more than 385 injunctions against tax fraud promoters and tax return preparers. Information about these cases is available on the Justice Department’s Web site, as is information about the Justice Department’s Tax Division.
Antitrust Division Senior Leadership NamedRead the Press Release
WASHINGTON — The Department of Justice’s Antitrust Division today announced the appointment of its new leadership team including the Chief of Staff, four Deputy Assistant Attorneys General, and a Special Counsel for Competition Policy. Two Deputies will oversee civil matters, one Deputy will oversee economic analysis and one Deputy will oversee international, policy and appellate issues.
"This is an outstanding team of dedicated and highly regarded professionals who are well respected within their fields of expertise," said Christine A. Varney, Assistant Attorney General in charge of the Department’s Antitrust Division. "This dynamic team of individuals has the vision, intellect and experience to ensure that the Antitrust Division aggressively pursues all areas of antitrust enforcement in order to protect American consumers from anticompetitive harm."
The leadership team includes:
Sharis Arnold Pozen, Chief of Staff and Counsel —Before she came to the Department in February 2009, Pozen was a partner at Hogan & Hartson’s Antitrust, Competition, and Consumer Protection Group where she worked from1995 to February 2009, on a variety of antitrust matters in the technology and healthcare industries, and served as Practice Group Director for the Washington, D.C. office. She has counseled clients on a wide range of antitrust and consumer protection matters as well as issues pertaining to mergers and acquisitions, joint ventures, and trade association matters. Prior to joining Hogan & Hartson, Pozen worked for five years at the Federal Trade Commission (FTC) as an Attorney Advisor to then Commissioners Varney and Yao, as Assistant to the Director of the Bureau of Competition, and as staff attorney. Pozen received her B.A. from Connecticut College in 1986 and her J.D. from Washington University in 1989.
Molly S. Boast, Deputy Assistant Attorney General for Civil Matters —Boast, who is expected to arrive at the Department in May, is a seasoned antitrust veteran with extensive antitrust and management experience. Since 2001, she has been a partner at the New York law firm of Debevoise & Plimpton LLP where she leads the antitrust practice group. From July 1999 to June 2001, Boast was Senior Deputy Director and Director of the FTC’s Bureau of Competition. During that time, she had management responsibility for merger and civil nonmerger Commission litigation and investigations, and has experience in competition issues in the energy and pharmaceuticals industries. Boast also served as the FTC’s representative to the European Community/FTC/Department of Justice Mergers Working Group. From 1987 to 1999, she worked at the New York law firm of LeBoeuf, Lamb, Greene & MacRae where she was head of the litigation department and a member of the firms’ Steering Committee. She has served in various positions within the American Bar Association’s Sections of Antitrust and Litigation. Boast received her B.A. in 1970 from the College of William and Mary, her M.S. in 1971 from the Columbia University School of Journalism, and her J.D. in 1979 from the Columbia University School of Law.
William Cavanaugh Jr., Deputy Assistant Attorney General for Civil Matters —Cavanaugh, who is expected to arrive at the Department in May, is a highly experienced and lauded antitrust litigator. Since 1985, Cavanaugh has been with the New York law firm of Patterson, Belknap Webb & Tyler LLP where he has served as the firm’s Co-Chair, Chair of the Litigation Department and a Litigation Partner since 1991. He has extensive trial and litigation experience in complex antitrust, patent and commercial matters. From 1981 to 1985, Cavanaugh was a Litigation Associate handling complex product liability, insurance coverage and general commercial matters at the New York law firm of Rivkin Radler LLP. He is a Fellow of the American College of Trial Lawyers, was named as one of the Best Lawyers in America for Antitrust Law and Commercial Litigation, and was named as one of New York’s "Super Lawyers" for Antitrust Litigation. He received his B.S. in 1977, from St. John’s University and his J.D. in 1980 from St. John’s University School of Law.
Carl Shapiro, Deputy Assistant Attorney General for Economic Analysis —Shapiro, who arrived at the Department in March, is a leading scholar in economics and brings to the Department a wealth of experience on issues, including patents, intellectual property and licensing, network economics, and unilateral effects in mergersShapiro is taking a leave of absence from the University of California at Berkeley, where he is Transamerica Professor of Business Strategy in the Haas School of Business and a Professor of Economics. He has been at the Haas School of Business since 1990. Shapiro was previously the Antitrust Division’s Economics Deputy from August 1995 to June 1996, where he provided economic analysis on a variety of antitrust cases, including Microsoft, NASDAQ and several mergers. Shapiro had been a Senior Consultant with CRA International, an economic consulting company. He was vice-chair of the American Bar Association Antitrust Section’s Economics Committee from 1995-1998. Shapiro taught at the Woodrow Wilson School and the Department of Economics at Princeton University for 10 years. He has published one book, "Information Rules: A Strategic Guide to the Network Economy," and numerous articles in the areas of industrial organization, competition policy, patents, network economics and the economics of innovation and competitive strategy. Shapiro received his Ph.D. in Economics from the Massachusetts Institute of Technology (MIT) in 1981. He also earned B.S. degrees in mathematics and economics from MIT as well as an M.A. in mathematics from UC Berkeley.
Philip J. Weiser, Deputy Assistant Attorney General for International, Policy and Appellate Matters —Weiser, who is expected to arrive at the Department in July, is an Antitrust Division veteran, and is currently a Professor and Associate Dean for Research at the University of Colorado, where he has taught since January 1999, in the School of Law and in the Interdisciplinary Telecommunications Program. During his tenure at the Department, Weiser will be on a leave of absence from the University of Colorado. Weiser has also served as a visiting Professor at the New York University School of Law (2008) and the University of Pennsylvania School of Law (2006). From August 2001 to June 2002, he was a Law and Public Affairs Program Fellow at Princeton University, one of only six law Professors selected as a scholar-in-residence. Weiser is the Founder and Executive DirectorofSilicon Flatirons Center for Law, Technology, and Entrepreneurship, which focuses on spurring interdisciplinary engagement, facilitating community outreach, and supporting interest in the intersection of technology, policy and business. From September 1996 to August 1998, Weiser was a Senior Counsel to Joel Klein, Assistant Attorney General of the Department’s Antitrust Division, where he advised Klein on antitrust policy in the telecommunications industry as well as participated in civil investigations. He served this fall as the lead agency reviewer of the FTC for the Presidential Transition Team, serves as the co-Chair of the Colorado Innovation Council, was a Special Master for the Colorado Public Utilities Commission, and was a Special Counsel to Cablevision Systems Corporation. Weiser clerked for Justices Byron R. White (Ret.) and Ruth Bader Ginsburg at the U.S. Supreme Court from September 1995 to August 1996. He also clerked for Judge David M. Ebel, Tenth Circuit Court of Appeals, from September 1994 to August 1995. He has published two books and numerous articles on and has regularly taught in the areas of competition policy and technology law. Weiser graduated with high honors from Swarthmore College in 1990 and with high honors from the New York University School of Law in 1994.
Gene Kimmelman, Chief Counsel for Competition Policy and Intergovernmental Relations —Kimmelman, who arrived at the Department in April, was most recently Vice President for Federal and International Affairs at Consumers Union (CU). During his tenure at CU, from 1995 to 2009, he directed CU’s federal and international policy programs. Kimmelman has extensive knowledge of deregulation, market structure and consumer protection issues. He is a recognized expert in a wide variety of areas, including telecommunications, Internet/media policy, product liability and antitrust law. He has represented consumers during the break up of AT&T, consideration of the Telecommunications Act of 1996, major media and telecommunications mergers, and at numerous congressional hearings. Prior to his employment at CU, from 1993 to 1995, Kimmelman served as Chief Counsel and Staff Director for the Antitrust Subcommittee of the U.S. Senate Judiciary Committee. Previous to that, from 1984 to 1993, he was Legislative Director for the Consumer Federation of America (CFA) where he directed their legislative and regulatory programs. In 1981, he began his career as a staff attorney for Public Citizen’s Congress Watch. Kimmelman received his B.A. from Brown University in 1977 and his J.D. from the University of Virginia in 1981. He studied in Denmark as a Fulbright Fellow at Copenhagen University’s graduate program on the public sector.
Illinois Refuse Container Repair Company Executives Indicted in Conspiracy to Defraud the City of ChicagoRead the Press Release
WASHINGTON — A Chicago grand jury indicted the president and vice president of an Illinois refuse disposal container repair company for engaging in a conspiracy and scheme to defraud the city of Chicago on a contract for the repair of refuse carts, the U.S. Department of Justice announced today. This is the first case to be brought in the Department’s ongoing antitrust investigation into the refuse cart repair industry.
The four-count indictment filed today in the U.S. District Court in Chicago charged Douglas E. Ritter, the company president, and Steven Fenzl, the company vice president, with conspiring to defraud the city of Chicago on a July 2005 contract. Ritter and Fenzl are also charged with mail and wire fraud.
According to the charges, Ritter and Fenzl’s scheme included misrepresenting the number of legitimate, competitive bids submitted to the city by, in addition to submitting a bid on behalf of their own company, fraudulently orchestrating the submission of bids from three additional companies, including determining the prices of those bids and submitting fraudulent documents with them. Additionally, as part of the scheme to defraud the city, Ritter and Fenzl made fraudulent certifications and omissions regarding the company’s use of Women and Minority Business Enterprise program subcontractors, and thereafter fraudulently collected payments from the city intended for those subcontractors. As part of the conspiracy and scheme to defraud, the conspirators used, or caused to be used, the U.S. Postal Service, FedEx Corporation and interstate wires.
"Schemes to subvert the competitive bidding process deprive citizens, and, in this case, the city of Chicago, of their right to fair and competitive pricing," said Scott D. Hammond, Deputy Assistant Attorney General in charge of the Antitrust Division’s Criminal Enforcement Program.
"Ensuring the integrity of the city of Chicago’s competitive bidding process is crucial, especially when citizens are stretching every dollar and making sacrifices to cope with a troubled economy. The city’s contracts are paid by the taxpayers. Those involved in obtaining contracts through fraud are inflating prices and are stealing from everyone in the community. These schemes erode the trust in government to spend public dollars wisely and procure goods and services at a fair price," said David H. Hoffman, Inspector General for the City of Chicago.
Ritter and Fenzl are charged with conspiracy to commit mail and wire fraud, two counts of mail fraud and one count of wire fraud. The defendants face a maximum penalty per count of $250,000 and 20 years in jail. The fine may be increased to twice the gain derived from the crime, or twice the loss suffered by the victims, if either of those amounts is greater than the statutory maximum.
The charges announced today resulted from an ongoing investigation of the refuse cart repair industry being conducted by the Department’s Antitrust Division and the City of Chicago Office of Inspector General.
Anyone with information concerning anticompetitive conduct in other city of Chicago, government or private contracts is urged to call the Chicago Field Office of the Antitrust Division at 312-353-7530.
Former Military Official Pleads Guilty to Participating in Bribery Conspiracy Involving $206 Million Telecommunications Contract in KoreaRead the Press Release
WASHINGTON - A former Army and Air Force Exchange Service (AAFES) official pleaded guilty today in U.S. District Court in Columbus, Ga., for his role in a conspiracy to commit bribery involving a multimillion dollar telecommunications contract, and for not reporting the bribes he accepted on his income tax returns, Assistant Attorney General Lanny A. Breuer of the Criminal Division announced.
According to court documents, Henry Lee Holloway, 42, of Hamilton, Ga., worked as an AAFES general store manager at the Central Exchange in the Republic of Korea from 2003 through 2007. The Department of Defense provides billions of dollars worth of merchandise and services annually through AAFES to military personnel by operating base and post exchanges worldwide.
From May 2003 to April 2005, Holloway admitted to conspiring with, among others, Gi-Hwan Jeong, the chief executive officer of Samsung Rental Company Ltd (SSRT), to use Holloway’s official position to maintain SSRT’s $206 million contract with AAFES to provide telecommunications services to U.S. Armed Forces installations in the Republic of Korea. In exchange for at least $70,000 worth of stock offerings, entertainment, travel expenses, cash and other things of value from Jeong, Holloway admitted he took official action to protect SSRT and further its interests, despite Holloway’s knowledge and belief that SSRT was underperforming and violating the terms of its contract with AAFES. According to court documents, prior to Jeong’s payments to Holloway, and as a result of SSRT’s failures to perform under the contractual relationship with AAFES, Holloway attempted to terminate the contractual relationship between AAFES and SSRT. After the payments from Jeong to Holloway began, and as the result of those payments, Holloway admitted he used official acts and influence to support and expand that contractual relationship, including contract amendments and obligation changes.
Holloway pleaded guilty to a two-count information before Judge Clay D. Land in the Middle District of Georgia, charging him with one count of conspiracy and one count of filing a false tax return. Holloway admitted he knowingly failed to report his bribe income for tax years 2003, 2004 and 2005. At sentencing, Holloway faces up to five years in prison on the conspiracy count, as well as a $250,000 fine. He faces up to three years in prison for filing a false tax return, as well as a $100,000 fine. The information also seeks forfeiture of Holloway’s assets derived from the criminal activity. A sentencing date has not yet been set by the court.
Jeong was indicted on Dec. 17, 2008, in the Northern District of Texas on two counts of bribery for his alleged role in the scheme. Jeong was arrested in Dallas on Nov. 19, 2008, on a criminal complaint. In upholding Jeong’s detention, U.S. District Court Judge Jane J. Boyle found probable cause to support charges and that Jeong was a flight risk. Jeong’s trial is scheduled to begin June 1, 2009.
An indictment is merely an allegation and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
The case is being prosecuted by Senior Trial Attorney Richard C. Pilger and Trial Attorneys Richard B. Evans and Eric G. Olshan of the Criminal Division’s Public Integrity Section, headed by William M. Welch, II, Chief. The case was investigated by the Air Force Office of Special Investigations, the FBI’s Dallas Field Office and the Internal Revenue Service.
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Columbus, Ohio, Home Builder, Accountant and Realtor Indicted in Tax Fraud and Money Laundering SchemeRead the Press Release
WASHINGTON - A federal grand jury has returned an 18-count superseding indictment charging Thomas E. Parenteau of Columbus, Ohio; Dennis G. Sartain of Hilliard, Ohio; and Bonnie Helt-Adams of Dublin, Ohio, with tax fraud, bank and wire fraud, money laundering and obstruction of justice, the Justice Department and Internal Revenue Service (IRS) announced today.
Parenteau and Sartain were indicted in September 2008 for an obstruction of justice conspiracy and witness tampering and have been detained since their arrests at that time. The superseding indictment includes additional allegations and adds Helt-Adams as a co-defendant. The case is assigned to Judge Michael H. Watson in Columbus.
According to the superseding indictment, Parenteau operated and controlled a number of Columbus-area businesses that were owned in the name of his wife, including Advanced Precast Building Systems LLC, Parenteau Builders LLC, Your Home Source LLC and MKP Investments LLC. Sartain has been Parenteau’s primary accountant since 2000. Helt-Adams is a licensed real estate agent who listed and sold many of Parenteau’s luxury homes and formally joined Your Home Source, LLC in 2005.
The superseding indictment alleges that Parenteau and Sartain prepared and filed four false income tax returns for Parenteau’s mistress that generated over $700,000 in fraudulent refunds, which went to Parenteau. The superseding indictment also charges Parenteau and Sartain with conspiracy to commit money laundering related to $18 million in fraudulently obtained loan proceeds secured against Parenteau’s home at 4500 Dublin Road, known as Loretta Estate – a 27,000 square foot residence that sits on 4.8 acres on the Scioto River in Dublin, Ohio.
In addition, the superseding indictment alleges that Parenteau and Helt-Adams engaged in a scheme to defraud lending and financial institutions out of millions of dollars by falsely inflating the purchase price of the homes Parenteau built and sold in exchange for paying large undisclosed or disguised kickbacks to the buyers after their purchases.
Finally, the superseding indictment alleges that after learning of the IRS investigation into the tax, bank fraud and money laundering schemes, Parenteau, Helt-Adams and Sartain engaged in a scheme to obstruct justice by concealing computers, creating false documents, destroying or altering evidence, tampering with a witness, lying to federal and local investigators and otherwise obstructing justice.
An indictment is merely a formal charge by the grand jury. Each defendant is presumed innocent unless and until proven guilty in U.S. District Court. If convicted, Parenteau faces a maximum sentence of 150 years in prison and a fine of over $4 million; Sartain faces a maximum sentence of 60 years in prison and a fine of over $1.5 million; Helt-Adams faces a maximum sentence of 105 years in prison and a fine of nearly $3 million.
The case is being prosecuted by Justice Department Tax Division Trial Attorneys Richard M. Rolwing, Jill M. Cassara and Sean B. O’Connell. 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/. Additional information about tax fraud schemes to watch out for may be found on the IRS Criminal Investigation Web site at http://www.ustreas.gov/irs/ci/.
West Virginia Man Pleads Guilty on Federal Civil Rights ChargesRead the Press Release
WASHINGTON - Daryl Lee Fierce, 69, of Charleston, W.Va., pleaded guilty today to a civil rights charge in federal court in the Southern District of West Virginia for using fire to intimidate and interfere with a person’s housing rights. Fierce set fire to the victim’s home because African-American and biracial individuals visited the victim in her home. Pursuant to the plea agreement, Fierce faces up to 10 years in prison and a fine of up to $250,000. Sentencing is scheduled for July 30, 2009.
According to documents filed in court, on or about July 16, 2007, Fierce admitted that he set fire to a home located on Noyes Avenue in Charleston because the tenant occupying the home, a white woman, associated with persons of another race and color. Fierce set fire to the outside wall of the victim’s bedroom at night as she slept. Fierce further admitted that before the incident he had used racial epithets against guests, including young children, who visited the victim’s home.
"Living in one’s home and associating with friends of one’s choosing, without violent interference because of race, is a core right of all persons in this country," said Loretta King, Acting Assistant Attorney General for Civil Rights. "The defendant used violence against an innocent victim because of his racial prejudice. This is illegal, and despicable, and we will prosecute such crimes whenever and wherever they occur."
The FBI, the Charleston Police Department and the Charleston Fire Department investigated this case. The case was prosecuted by James Walsh with the Justice Department’s Civil Rights Division and Lisa G. Johnson, Assistant U.S. Attorney for the Southern District of West Virginia.
Subsidiaries of Swedish Company, Trelleborg AB, Agree to Plead Guilty and Pay $11 Million in Criminal FinesRead the Press Release
WASHINGTON — Two subsidiaries of the Swedish company Trelleborg AB, one based in Virginia and the other in France, have agreed to plead guilty and pay a total of $11 million in criminal fines for their participation in separate conspiracies affecting the sales of marine products sold in the United States and elsewhere, the Department of Justice announced today.
A two-count felony charge was filed today in U.S. District Court in Norfolk, Va., against Virginia Harbor Services Inc., formerly known as Trelleborg Engineered Products Inc. (VHS/TEPI), a manufacturer of foam-filled marine fenders, buoys and plastic marine pilings headquartered in Clearbrook, Va.
According to the charges, VHS/TEPI participated in a conspiracy between December 2002 and August 2005 to allocate customers and rig bids for contracts to sell foam-filled marine fenders and buoys, and also participated in a separate conspiracy between December 2002 and May 2003 to allocate customers and rig bids for contracts to sell plastic marine pilings. Under the terms of the plea agreement, which is subject to court approval, VHS/TEPI has agreed to pay a $7.5 million criminal fine and to cooperate fully in the Department’s ongoing antitrust investigation.
To date, six individuals and two corporations have pleaded guilty or agreed to plead guilty in the Antitrust Division’s ongoing investigation of fraud and collusion in the marine fenders and pilings industries.
Foam-filled marine fenders are used as a cushion between ships and either fixed structures, such as docks or piers, or floating structures, such as other ships. Foam-filled buoys are used in a variety of applications, including as channel markers and navigational aids. Plastic marine pilings are substitutes for traditional wood timber pilings and are often used in port and pier construction projects in conjunction with foam-filled fenders.
In addition, a one-count felony charge was filed today in U.S. District Court in Fort Lauderdale, Fla., against Trelleborg Industrie S.A.S. (TISAS), a manufacturer of marine hose headquartered in Clermont-Ferrand, France. TISAS is charged with participating in a conspiracy from at least as early as 1999 and continuing until as late as May 2, 2007, to allocate market shares, fix prices and rig bids for contracts to sell marine hose to purchasers in the United States and elsewhere. Marine hose is a flexible rubber hose used to transfer oil between tankers and storage facilities.
Under the terms of the plea agreement, which is subject to court approval, TISAS has agreed to pay a $3.5 million criminal fine and to cooperate fully in the Department’s ongoing antitrust investigation. To date, three corporations have pleaded guilty or agreed to plead guilty in the Antitrust Division’s ongoing investigation in the marine hose industry. Twelve individuals have also been charged to date, nine of whom have pleaded guilty.
"The cases filed today follow the prosecution of numerous other participants in these worldwide conspiracies to inflate the price of marine products critical to both the military and to industry," said Scott D. Hammond, Acting Assistant Attorney General in charge of the Department’s Antitrust Division. "Those who harm U.S. purchasers by rigging bids will pay the price through stiff fines and jail sentences."
"Price fixing and bid rigging are serious crimes that drain resources from the Department of Defense and the American taxpayer. The Defense Criminal Investigative Service takes very seriously all violations of U.S. antitrust laws that affect products and services procured for our soldiers, sailors, airmen and Marines. DCIS aggressively investigates those who seek to cheat the DOD and the public by conspiring to suppress competition," said Sharon Woods, Director, DCIS.
Five former executives of TISAS and VHS/TEPI previously pleaded guilty to participating in the conspiracies charged today. Former VHS/TEPI president Robert B. Taylor was sentenced in January 2008 to serve 24 months in prison and pay a $300,000 criminal fine. Former VHS/TEPI chief financial officer Donald L. Murray was sentenced in March 2008 to serve 18 months in prison and pay a $75,000 criminal fine. William Alan Potts, a former vice president of VHS/TEPI, was sentenced in June 2008 to serve six months in prison and six months in home detention, and to pay a $60,000 criminal fine. Former TISAS executives Christian Caleca and Jacques Cognard were each sentenced in December 2007 to serve 14 months in prison and to pay criminal fines of $75,000 and $100,000, respectively.
VHS/TEPI and TISAS are charged with violating the Sherman Act, which carries a maximum fine of $100 million for corporations. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.
Today’s charge is an example of the Department’s commitment to protect U.S. taxpayers from public procurement fraud through its creation of the National Procurement Fraud Task Force. The National Procurement Fraud Initiative, announced in October 2006, is designed to promote the early detection, identification, prevention and prosecution of procurement fraud associated with the increase in contracting activity for national security and other government programs.
The investigation is being conducted by the Antitrust Division’s National Criminal Enforcement Section, the Defense Criminal Investigative Service (DCIS) of the Department of Defense’s Office of Inspector General, the U.S. Navy Criminal Investigative Service and the Federal Bureau of Investigation. Anyone with information concerning bid rigging or other anticompetitive conduct in the marine products industry is urged to call the Antitrust Division’s National Criminal Enforcement Section at 202-307-6694, the Arlington, Va., Resident Agency of the DCIS at 703-604-8439, or the Long Beach, Calif., Resident Agency of the DCIS at 562-256-2501.
Dupont and Lucite International Agree to Pay $2 Million for Clean Air Act ViolationsRead the Press Release
WASHINGTON—DuPont and Lucite International Inc. have agreed to pay a $2 million civil penalty to settle Clean Air Act violations at a sulfuric acid plant in Belle, W. Va., the Justice Department, U.S. Environmental Protection Agency (EPA) and the state of West Virginia announced today.
The sulfuric acid plant is located on a 100-acre chemical manufacturing complex along the Kanawha River. The plant is owned by Lucite and operated by DuPont. The companies will pay $1 million to the United States and $1 million to the state of West Virginia. Further, the companies chose on their own to shut down the sulfuric acid manufacturing unit of a larger chemical facility at the site and the settlement confirms this agreement. Under the settlement, the sulfuric acid unit is scheduled to shut down by April 1, 2010.
"This settlement is part of the U.S. government’s dedicated effort to bring all sulfuric acid manufacturers into compliance with the Clean Air Act," said John C. Cruden, Acting Assistant Attorney General in charge of the Justice Department’s Environment and Natural Resources Division.
"The actions taken as part of this settlement will reduce emissions of air pollutants by more than 1,000 tons each year," said Catherine McCabe, Acting Assistant Administrator for the EPA’s Office of Enforcement and Compliance Assurance. "Sulfur dioxide emissions can be harmful to children, the elderly and people with heart and lung conditions."
In a joint complaint, filed concurrently with the consent decree, the United States and West Virginia allege that the companies made modifications to their plant in 1996 without first obtaining pre-construction permits and installing required pollution control equipment. The Clean Air Act requires major sources of air pollution to obtain such permits before making changes that would result in a significant emissions increase of any pollutant.
The Belle sulfuric acid plant burns sulfuric acid sludge, which creates sulfur dioxide. Most of the sulfur dioxide is converted to sulfuric acid and recovered but a portion of the chemical is emitted to the atmosphere. In addition to sulfur dioxide, the plant also emits sulfuric acid mist, nitrogen dioxide and carbon monoxide.
Sulfur dioxide can have serious health effects on children, the elderly, and people with heart and lung conditions. Acid rain is also believed to leach nutrients from sensitive soils and damage forests. Sulfuric acid is widely used for ore processing, fertilizer manufacturing, oil refining, wastewater processing and chemical synthesis.
The settlement is part of an EPA initiative to improve compliance among industries that have the potential to cause significant amounts of air pollution, including the cement manufacturing, glass manufacturing, and acid production industries.
The consent decree, lodged today in the U.S. District Court for the Southern District of West Virginia, 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.
Attorney General Eric Holder Welcomes Assistant Attorneys Generalfor Antitrust, Civil and Criminal DivisionsRead the Press Release
WASHINGTON – Attorney General Eric Holder today welcomed the confirmation of three Assistant Attorneys General to the Department of Justice for the Antitrust, Civil and Criminal Divisions. Christine A. Varney of the Antitrust Division, Tony West of the Civil Division, and Lanny A. Breuer of the Criminal Division were confirmed today by the U.S. Senate.
"These exceptional individuals will help lead the Department with dedication, sound judgment and integrity, whether it’s aggressively enforcing the antitrust laws, overseeing civil enforcement in the Department’s largest litigation division, or combating traditional crimes such as financial fraud or drug trafficking," said Attorney General Eric Holder. "I look forward to working with them to advance the interests of justice on behalf of the American people."
The mission of the Antitrust Division is to enforce the nation’s antitrust laws to protect and promote competition. In a competitive marketplace, U.S. consumers benefit from lower prices, better quality goods and services, and greater innovation.
Since 1997, Varney was a partner at Hogan & Hartson’s Washington, D.C. office heading up the firm’s Internet Practice Group. She was an associate at that firm from 1990 to 1992. Varney’s practice included providing advice and counsel on antitrust, regulatory, consumer protection, privacy and intellectual property in various industries, including technology, media, airlines and health care. She has also provided her expertise to the Organization of Economic Cooperation and Development (OECD) on international competition issues. She had rejoined Hogan & Hartson in 1997 after serving five years in the government.
From 1994 to 1997, Varney served as a Commissioner at the Federal Trade Commission (FTC) working on a wide variety of technology-related issues including innovation markets, vertical theory and privacy issues in the information age. Prior to becoming an FTC Commissioner, Varney was Secretary to the Cabinet in the Clinton Administration.
She is a member of several committees of the American Bar Association including the Antitrust Section and served as Chair of the Committee on Election Law. She has lectured in the United States and abroad and has published articles on a variety of issues, including the computer industry, media, and privacy and data security.
Varney received her J.D. from Georgetown University in 1986. She received her M.P.A. from Syracuse University in 1978, and her B.A. from The State University of New York, University at Albany in 1977.
The Civil Division, which functions as the government’s law firm, represents the United States, its departments and agencies, Members of Congress, Cabinet officers and other federal employees. It is the Department’s largest litigation division.
Before coming to the Department, West was a litigation partner at Morrison & Foerster in San Francisco. His trial practice included representing individuals and companies in civil and criminal matters.
West previously served as state Special Assistant Attorney General, an appointee of California Attorney General Bill Lockyer. In that capacity, he advised the California Attorney General on various matters including high-tech crime, identity theft, the Microsoft antitrust litigation, police officer training, civil rights and police misconduct.
From 1994 to 1999, West served as an Assistant U.S. Attorney for the Northern District of California. From 1993 through 1994, he served as a Special Assistant in the Department under the direction of Deputy Attorneys General Philip Heymann and Jamie Gorelick, as well as Attorney General Janet Reno. West worked on the development of national crime policy, including the 1994 Omnibus Crime Bill.
West graduated with honors from Harvard University in 1987, where he served as publisher of the Harvard Political Review, and received his law degree, in 1992, from Stanford Law School, where he was elected President of the Stanford Law Review.
The Criminal Division’s more than 700 attorneys and support personnel develop, enforce and supervise the application of all federal criminal laws, except those specifically assigned to other divisions.
Before coming to the Department, Breuer was a partner at Covington & Burling LLP’s Washington, D.C. office, where he co-chaired the firm’s white collar defense and investigations practice group and served as vice-chair of the pro bono committee. Breuer first joined the firm in 1989, where he specialized in white collar criminal and complex civil litigation, internal corporate investigations, congressional investigations, antitrust cartel proceedings and other matters involving high-profile legal and political risks.
From 1997 to 1999, Breuer served as special counsel to former President William J. Clinton. Earlier in his career, Breuer was an Assistant District Attorney in Manhattan from 1985 to 1989, where he prosecuted various criminal cases including murder, gang violence, armed robbery, child abuse, burglary, white collar crime and larceny. Breuer has been recognized as a leading litigator by numerous publications, and he is a fellow of the American College of Trial Lawyers.
Breuer received a bachelor’s degree from Columbia University in 1980. He received his law degree from Columbia Law School in 1985, where he was a Harlan Fiske Stone Scholar .
Alta Colleges to Pay U.S. $7 Million to Resolve False Claims Act AllegationsRead the Press Release
WASHINGTON -- Alta Colleges Inc. and its wholly-owned collegiate schools in Texas have agreed to pay the United States $7 million to resolve allegations under the False Claims Act that the Texas schools submitted false claims for federal student aid funds, the Justice Department announced today.
For a college to qualify to receive federal student aid, one requirement is that it meet applicable state licensing requirements. The United States alleged that Alta’s Texas colleges obtained the requisite state licenses by misrepresenting to the state licensing agency that they complied with state job-placement reporting requirements and that their interior design programs complied with requirements for a professional license.
"This settlement demonstrates the government’s commitment to enforcing the compliance standards required of colleges participating in the federal student aid program," said Michael F. Hertz, Acting Assistant Attorney General of the Civil Division of the Department of Justice.
Alta Colleges, which is headquartered in Denver, has over 12,000 students at 19 campuses in California, Colorado, Georgia, Illinois, Texas and Virginia.
The civil settlement agreement released today resolves certain allegations that were originally filed in a federal lawsuit brought by whistleblowers under the federal False Claims Act. The False Claims Act permits private citizens to bring lawsuits on behalf of the United States and to share in any recovery. Under the settlement, the whistleblowers who initiated the lawsuit will receive $1.19 million.
This matter was investigated by the U.S. Department of Education. The settlement was the result of a coordinated effort among the Civil Division of the Department of Justice and the U.S. Attorney’s Office for the Northern District of Texas.
Utah Natural Gas Producers Agree to Air Emission Reductions, Conservation PracticesRead the Press Release
WASHINGTON—Six energy companies, in three settlements, have agreed to install pollution control equipment at a cost of over $6 million to comply with the Clean Air Act at their natural gas producing facilities in the Uinta Basin, near Vernal, Utah, the Justice Department and U.S. Environmental Protection Agency announced today. The facilities are located on the Uintah & Ouray Indian Reservation.
The series of three settlements with Bill Barrett Corp, Wind River Corp, XTO Energy Inc., Dominion Exploration and Production Inc., Whiting Oil and Gas Corporation, and Miller Dyer and Company were filed today in U.S. District Court in Salt Lake City, Utah. The agreements mandate air pollution reductions and conservation practices at the companies’ natural gas compressor stations, well heads, and pipelines across the Uinta Basin.
In addition to $6,462,000 in retrofits and upgrades to implement pollution control equipment, the agreements require the companies to pay $632,000 in civil penalties and to spend $200,000 on supplemental environmental projects.
As part of the settlements, the companies have agreed to perform the following:
- Retrofit pneumatic controls with lower emitted components
- Conduct a process optimization review to increase natural gas recovery and reduce air emissions at compressor stations and well sites
- Control emission sources, such as large engines, gas dehydrators, condensate tanks at all new facilities constructed in the next five years and install low/no-bleed pneumatics
- Shale-plate all future well access roads
- Fund the operation & maintenance of two ambient air monitoring stations for one year at a cost of approximately $100,000
- Pilot new technologies that are less polluting and more energy efficient
According to complaints filed simultaneously with the settlements, the companies allegedly violated several provisions of the Clean Air Act, including emission standards for hazardous air pollutants, federal permitting, emissions monitoring and reporting requirements. Dominion Exploration and Production and Miller Dyer came forward and disclosed their violations under EPA’s self-audit policy. All the companies have worked cooperatively with EPA to appropriately resolve violations.
"These settlements not only obtain compliance with the law and control emission sources, but will reduce greenhouse gas emissions and bring more natural gas to the marketplace," said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division.
"These settlements deliver clear results for the people of Utah and the Uintah and Ouray Indian Reservation," said Carol Rushin, EPA Acting Regional Administrator. "The mandated pollution controls will reduce emissions of air toxics and greenhouse gases, while conservation measures will help return valuable natural gas to the marketplace."
EPA estimates that the investment in technology will reduce air pollution by more than 1,300 tons per year. The reduction in greenhouse gas emissions, including methane, is equivalent to the annual carbon sequestration of 9,400 acres of pine or fir forest or comparable to taking more than 7,600 cars off the road each year. The natural gas conserved is enough to heat approximately 1,080 homes annually.
The consent decrees were lodged in U.S. District Court for the District of Utah and are subject to a 30-day comment period and final approval by the court. A copy of the consent decree is available on the Justice Department Web site at http://www.usdoj.gov/enrd/Consent_Decrees.html.
Owner of Alabama Tire Store Pleads Guilty <br /> to Tax EvasionRead the Press Release
WASHINGTON - Timothy Smith, a resident of Cullman, Ala., pleaded guilty today in federal court in Birmingham to one count of tax evasion, the Justice Department and Internal Revenue Service (IRS) announced. Smith, the owner of College Tire in Hanceville, Ala., was scheduled to begin trial before Judge R. David Proctor on April 21, 2009.
Smith was indicted in September 2008 and charged with two counts of tax evasion relative to tax years 2002 and 2003.
According to the indictment, plea agreement and other court records, Smith diverted customer receipts from his tire business into two personal bank accounts. Smith also used, or directed others to use, cash and cashiers’ checks to make substantial principal payments on the mortgage for his vacation home in North Carolina and his vacation home in Pensacola, Fla. In total, Smith diverted more than $430,000 from his tire business to his personal bank accounts and his mortgages. In approximately August 2003, he also purchased a real estate lot in North Carolina near his vacation home with $68,100 in cash.
According to court records, Smith concealed the funds that were diverted to his personal accounts and his mortgages from his bookkeeper, who prepared both Smith’s business tax returns as well as Smith’s joint personal tax returns. Smith also took substantial fraudulent tax deductions in relation to a purported farm at his personal residence. As a result, Smith filed false personal and business tax returns for tax years 2000 through 2003. The tax loss resulting from Smith’s scheme was more than $400,000.
As part of his plea agreement, Smith agreed to a binding sentence of 30 months in prison and agreed to pay $170,380 in restitution to the IRS, including a lump sum payment of $50,000 to be paid prior to sentencing. As part of the plea agreement, the government agreed to dismiss tax charges against Smith’s wife, Lori Ann Smith.
Acting Assistant Attorney General John A. DiCicco of the Justice Department’s Tax Division thanked the special agents from IRS-Criminal Investigation who investigated the case, as well as Tax Division trial attorneys Jed M. Silversmith and Matthew J. Mueller, and Assistant U.S. Attorney Michael Whisonant, who are prosecuting the case.
Former Mendenhall, Mississippi, Police Chief Sentenced for Using Excessive ForceRead the Press Release
WASHINGTON – A federal judge today sentenced Jimmy "Jimbo" Sullivan, the former chief of police in Mendenhall, Miss., to 30 months in prison for using excessive force when he repeatedly stomped on the head of an arrestee, announced Acting Assistant Attorney General Loretta King for the Civil Rights Division and Acting U.S. Attorney Stan Harris for the Southern District of Mississippi.
At his guilty plea hearing on Jan. 30, 2009, Sullivan admitted that he used excessive force on July 22, 2005, after joining other law enforcement officials in the apprehension of a man who led police on a car chase. At the end of the chase, Sullivan pulled the man from his car and repeatedly stomped on his head as the man lay face-down in the street. A local hospital treated the man for injuries sustained during the assault.
This case was investigated by the Jackson office of the FBI, and was prosecuted by Trial Attorney Patti Sumner of the Justice Department’s Civil Rights Division and Assistant U.S. Attorney Glenda Haynes of the Southern District of Mississippi.
Virginia Man Pleads Guilty to Selling Counterfeit <br /> Computer Software Worth $1 MillionRead the Press Release
WASHINGTON – A Virginia man pleaded guilty today to selling counterfeit computer software on eBay in violation of criminal copyright infringement laws, announced Acting Assistant Attorney General Rita M. Glavin of the Criminal Division and U.S. Attorney Jeffrey A. Taylor for the District of Columbia. According to court documents, the retail value of the software illegally sold was approximately $1 million.
Gregory William Fair, 46, of Falls Church, Va., pleaded guilty to one count of criminal copyright infringement and one count of mail fraud before Judge R.W. Roberts in U.S. District Court for the District of Columbia. According to court documents, from 2001 through February 2008, Fair admitted that he sold a large volume of counterfeit Adobe software on the eBay auction Web site using multiple user IDs. The combined retail value of this software was at least $1 million. Fair agreed to forfeit the proceeds of his unlawful enterprise including: $144,000 in currency seized from a safety deposit box and residence; one BMW 525i; one Hummer H2; one Mercedes CL600; and one 1969 Pontiac GTO.
At sentencing on July 8, 2009, Fair faces up to five years in prison on the criminal copyright infringement count and up to 20 years in prison on the mail fraud count. He also faces a maximum fine of $250,000 and three years of supervised release on each charge.
The case is part of the Department of Justice’s ongoing initiative to combat online auction piracy. Including the plea announced today, the Department has obtained 34 convictions involving online auction and commercial distribution of counterfeit software. The Department’s initiative to combat online auction piracy is just one of several steps being undertaken to address the losses caused by intellectual property theft and hold responsible those engaged in criminal copyright infringement.
The case was investigated by the U.S. Postal Inspection Service in Washington, D.C. The case is being prosecuted by Trial Attorney Marc Miller of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Glenn S. Leon for the District of Columbia.
Oil Company and Two Executives Plead Guilty to Environmental CrimesRead the Press Release
WASHINGTON—Texas Oil and Gathering Inc., its owner John Kessel and its operations manager Edgar Pettijohn pleaded guilty today in U.S. District Court in Houston to criminal violations related to the disposal of refinery wastes at an underground injection well in violation of the Safe Drinking Water Act, the Justice Department announced.
The two corporate officers pleaded guilty to conspiracy and violating the Safe Drinking Water Act for disposing of oil-contaminated waste water from its refinery process at an underground injection well permitted to accept wastes only from oil and gas production wastes. The company pleaded guilty to conspiracy and violating the Resource Conservation and Recovery Act (RCRA) for disposing of hazardous waste at an unpermitted facility. The crimes took place from January 2000 through January 2003.
Texas Oil and Gathering Inc. faces a maximum fine of $500,000 or twice monetary gain or loss for the conspiracy count and $50,000 per day, twice the gain or loss, or $500,000, whichever is higher, for the RCRA count. Kessel and Pettijohn face up to eight years in prison and a fine of up to $500,000. U.S. District Court Judge Keith P. Ellison scheduled the sentencing hearing for Sept. 15, 2009.
The charges against the Alvin, Texas-based company and its two officers involved the fraudulent representation to a Rosharon, Texas, injection well that the wastewater the company was disposing at the well came from an oil well Kessel had leased and was developing. In reality the wastewater came from the company’s reclamation process involving the distillation of various liquids from refineries and chemical plants.
Between January 2000 and January 2003, Kessel and Pettijohn directed subordinates to truck its oil and water waste from distillation to the class II injection well and fill out disposal forms indicating it came from an oil well leased by Kessel. A class II injection well is permitted to accept only oil and gas production wastes generated from the exploration of oil and gas. Usually the wastes consist primarily of brine mixed with some crude oil or gas distillate. In this case the waste water was mixed with refined products and chemicals not usually found in oil and gas production wastes such as higher concentrations of toluene and xylene.
The government’s investigation began in January 2003, when the injection well exploded and killed three workers. Although the explosion was not caused by the defendants, a closer review of the waste that went to the injection well led to their prosecution.
"The Safe Water Drinking Act and the regulations overseeing oil and gas related injection wells are designed to ensure safe sources of drinking water. Violations of these laws will be investigated and prosecuted to the fullest extent of the law," said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division.
"We remain committed to protecting the precious natural resources of Texas and hope that today’s conviction sends a clear message to everyone in the industrial community that the government will investigate and prosecute anyone who attempts to circumvent our nation’s anti-pollution laws," said Tim Johnson, Acting U.S. Attorney for the Southern District of Texas.
"The defendants tried to make an illegal end run around our environmental laws in order to increase their bottom line," said Warren Amburn, Special Agent-in-Charge of EPA's criminal enforcement office in Dallas. "These guilty pleas serve as a reminder that senior company executives who decide to commit environmental crimes will be prosecuted—not just the company."
The investigation was conducted by the EPA-Criminal Investigation Division, the Texas Commission on Environmental Quality and the Texas Environmental Enforcement Task Force. It was prosecuted by Senior Counsel Rocky Piaggione, Trial Attorney Leslie Lehnert of the Justice Department’s Environmental Crimes Section and Special Assistant U.S. Attorney William Miller of the EPA’s Region Six Office of Regional Counsel.
Justice Department Requests Extension of Microsoft Final JudgmentRead the Press Release
WASHINGTON — The Department of Justice told the U.S. District Court for the District of Columbia today that it is necessary to extend the term of certain portions of the Microsoft final judgment by at least 18 months. The Department said that an extension is necessary to ensure the quality of the technical documentation Microsoft provides to licensees.
The Department’s Antitrust Division made its views known today as part of its Joint Status Report to Judge Colleen Kollar-Kotelly of the U.S. District Court for the District of Columbia. The Antitrust Division enforces the final judgment in conjunction with antitrust enforcers from 17 states and the District of Columbia, which along with Microsoft joined in today’s filing with the court.
In 2006, Microsoft agreed to a two-year extension of the communications protocol licensing program contained in Section III.E of the final judgment, along with all of the final judgment’s enforcement provisions. Microsoft also agreed that the Department and state antitrust enforcement agencies may, at their discretion, apply to the court for an additional extension of all or part of the extended provisions of the final judgment for a period of up to three additional years, through November 2012. The United States is exercising its right under this provision to seek an extension of Section III.E and its supporting provisions through May 12, 2011. Without this action, the final judgment would have expired on Nov. 12, 2009.
Section III.E of the final judgment requires that Microsoft make available to competing server software developers, on reasonable and non-discriminatory terms, certain technology used by Microsoft to make its server operating systems interoperate with client PCs running the Windows operating system. Microsoft must provide licensees with technical documentation that is designed to enable them to use this technology in their own server products so that those products work better with Windows.
In past status reports, the Department reported to the court its concerns with the quality of the technical documentation Microsoft provides to licensees under this program and with the length of time it is taking Microsoft to improve that documentation.
The Department today also submitted the necessary papers to the court for its consideration.
Justice Department Reaches Settlement with Philadelphia Regarding Polling Place Access for People with DisabilitiesRead the Press Release
WASHINGTON - The Justice Department today announced a settlement under the Americans with Disabilities Act (ADA) with the city of Philadelphia to greatly improve accessibility for individuals with mobility disabilities at the city’s 1,200 polling places. Today’s settlement is the first settlement by the Justice Department with a city focused solely on accessible polling places.
Under the terms of the settlement, the city of Philadelphia recognizes that accessible polling places are the cornerstone of its voting accessibility program and will make its polling places accessible to persons with disabilities. The settlement will give people with mobility disabilities the opportunity to vote at polling places, rather than through the use of an absentee-type ballot. The city will also pay for an independent expert, who will assess the accessibility of nearly half the polling places and make recommendations to make polling places accessible on Election Day. The Justice Department will evaluate the remaining polling places for accessibility. The settlement also requires that accessibility based on ADA standards will be a major criterion in the city’s selection of future polling places. In addition, the settlement agreement requires the city to provide access to alternate means of voting for individuals with disabilities until their polling places are made accessible.
"The right to vote is the foundation of our democracy. This agreement will help ensure that persons with mobility disabilities have the opportunity to exercise their right and cast their ballot in person, at the polls, near their homes and alongside their neighbors," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "The Justice Department is committed to continued, vigorous enforcement of the Americans with Disabilities Act."
A separate, class-action lawsuit (Kerrigan v. The City of Philadelphia) filed by certain voters with disabilities against Philadelphia regarding the accessibility of the city’s polling places has been resolved along with the Department’s investigation.
More information about this settlement and the ADA is available at the Justice Department’s toll-free ADA Information Line at (800) 514-0301 or (800) 514-0383 (TTY), and via the ADA Web site at http://www.ada.gov.
Iraqi-Born Dutch Citizen Sentenced to 25 Years in Prison for Terrorism Conspiracy Against Americans in IraqRead the Press Release
WASHINGTON – An Iraqi-born Dutch citizen was sentenced to 25 years in prison today for conspiring to murder Americans overseas, including by planting roadside bombs targeting U.S. soldiers in Fallujah, Iraq, and by demonstrating on video how these explosives would be detonated to destroy American vehicles and their occupants.
The sentencing of Wesam al-Delaema, age 36, was announced today by David Kris, Assistant Attorney General for National Security; Jeffrey A. Taylor, U.S. Attorney for the District of Columbia; and Joseph Persichini, Jr., Assistant Director in Charge of the Federal Bureau of Investigation (FBI) Washington Field Office.
At a hearing today in U.S. District Court for the District of Columbia, Judge Paul Friedman imposed the 25-year sentence against al-Delaema for conspiracy to murder U.S. nationals outside the United States. Al-Delaema pleaded guilty to this charge on Feb. 25, 2009. The Court made a finding that this offense was a federal crime of terrorism. In addition, video materials referenced in al-Delaema’s factual proffer were played in court for the first time.
On Tuesday, in a separate case, al-Delaema was sentenced in Superior Court for the District of Columbia to 18 months imprisonment for aggravated assault. Al-Delaema pleaded guilty to this charge on March 3, 2009, admitting that he kicked a D.C. prison guard to the point of unconsciousness while the guard was prone on the ground during an incident at the D.C. jail in 2007. The prison guard sustained significant injuries, including a subdural hemorrhage, during the incident.
The sentences for these separate offenses are to be served concurrently and were agreed upon as part of the global plea agreement. According to an agreement between the United States and the Netherlands, al-Delaema will serve out his sentence in the Netherlands.
According to the plea agreement and factual proffers filed in court, between October 2003 and May 2, 2005, al-Delaema entered into an agreement with several co-conspirators to murder U.S. nationals in Iraq. As part of the conspiracy, al-Delaema travelled to Fallujah in October 2003. There, al-Delaema and his co-conspirators -- calling themselves the "Mujahideen from Fallujah" -- declared their intentions to kill Americans in Iraq using improvised explosive devices (IEDs).
As part of the conspiracy, al-Delaema and his co-conspirators discussed and demonstrated, on video, the way in which the IEDs they had buried in a road near Fallujah would be detonated and would destroy American vehicles driving on the road and kill the American occupants of those vehicles.
According to the factual proffer that he agreed to, al-Delaema not only created "how-to" and recruitment videos, but also filmed the effects of roadside attacks in Iraq. Furthermore, after his return to the Netherlands, al-Delaema continued to attempt to obtain propaganda videos for those seeking to kill Americans in Iraq, frequently attempting to obtain raw footage of attacks on Americans in Iraq.
Al-Delaema was arrested by Dutch law enforcement authorities on May 2, 2005, and he initially faced similar charges in that country. Following his arrest, Dutch law enforcement and prosecution authorities worked cooperatively with the FBI in its investigation of al-Delaema’s terrorist activities.
In September 2005, the United States filed a formal request with the Netherlands seeking al-Delaema’s extradition. The extradition request was subsequently granted by a Dutch court and then by the Dutch Ministry of Justice. In December 2006, the extradition request was sustained on appeal in the Netherlands. In January 2007, al-Delaema was flown to the United States, arrested and taken into custody by the FBI.
"This case represents the first use of U.S. criminal courts to prosecute an individual for terrorism offenses against Americans in Iraq," said David Kris, Assistant Attorney General for National Security. "The sentence imposed today should serve notice that the United States will use all available tools to pursue those who would plot attacks against our men and women serving in Iraq."
"The actions of this defendant were repugnant and contributed to the considerable violence against Americans in Iraq," stated U.S. Attorney Jeffrey A. Taylor. "This case, which represents the first use of the United States criminal courts to prosecute an individual for terrorism offenses against Americans in Iraq, demonstrates our resolve to use every tool at our disposal to defend Americans, both at home and abroad."
"The FBI is prepared at a moments notice to vigorously investigate injuries and threats to citizens, whether they occur in or outside the United States," said FBI Assistant Director in Charge Joseph Persichini, Jr. "We would particularly like to thank our Dutch law enforcement partners who worked with us for the past four years to bring this case to fruition."
The investigation into this matter was conducted by the FBI’s Washington Field Office, with assistance from the Dutch National Police Agency and the National Office of the Public Prosecutor in the Netherlands. The Office of International Affairs in the Criminal Division of the U.S. Department of Justice coordinated the extradition efforts on behalf of the United States.
The prosecutors handling the case are Assistant U.S. Attorneys Gregg Maisel and Rachel Lieber of the U.S. Attorney’s Office for the District of Columbia, and Trial Attorney David I. Miller of the Counterterrorism Section of the Justice Department’s National Security Division.
Former Gary, Indiana, Police Chief Sentenced<br /> for Federal Civil Rights ViolationRead the Press Release
WASHINGTON – Acting Assistant Attorney General Loretta King of the Civil Rights Division announced today that Thomas Houston, former Chief of the Gary, Ind., Police Department, was sentenced to 41 months in prison followed by two years of supervised release for violating the civil rights of a Gary resident in June 2007.
Houston was convicted in Sept. 2008 of assaulting the victim, identified in court documents as V.A., by striking and kicking him in the stomach while he was handcuffed, resulting in contusions to his face, head, chest and abdomen. Houston, a 42-year veteran of the department, had been chief for just seven days when he committed the assault. He resigned from the post shortly after being indicted in March 2008.
Evidence presented during the six-day trial revealed that Houston’s home was burglarized on June 1, 2007, and that he incorrectly believed that a neighbor was responsible for the burglary. Houston summoned on-duty officers to leave their posts and accompany him to the neighbor’s home. V.A., who was visiting a friend in the home, was handcuffed, dragged out of the home and assaulted by Houston. He was then jailed for four days before being released. No evidence was found linking the victim to the burglary, which remains unsolved.
"Police officers are given tremendous authority and responsibility so that they can protect and serve the public trust," said Loretta King, Acting Assistant Attorney General of the Civil Rights Division. "Those who abuse that authority face serious consequences. The Civil Rights Division is committed to prosecuting all cases of official misconduct and to bringing these individuals to justice."
The case was prosecuted by Trial Attorneys Betsy Biffl and Erin Aslan from the Civil Rights Division of the Justice Department.
Federal Court Bars Bloomfield, Connecticut Tax Preparer from Preparing Tax ReturnsRead the Press Release
WASHINGTON - A federal court has permanently barred Donald Morris of Bloomfield, Conn., from preparing federal income tax returns for others, the Justice Department announced today. Morris consented to the permanent injunction order, which was entered by U.S. District Court Judge Jane C. Hall in the U.S. District Court for the District of Connecticut.
According to the government complaint, Morris prepared over 1,000 federal income tax returns from 2003 through 2008. The complaint alleges that returns prepared by Morris claimed deductions for fictitious or inflated un-reimbursed employee expenses, deductions for fictitious or inflated job search expenses, fictitious or inflated education credits and fictitious or inflated credits for child care expenses.
In the past decade, the Justice Department’s Tax Division has obtained more than 380 injunctions against tax return preparers and tax fraud promoters. Information about these cases is available the Justice Department’s Tax Division Web site.
Department of Justice Releases Four Office of Legal Counsel OpinionsRead the Press Release
In connection with ongoing litigation, the Department of Justice today released four previously undisclosed Office of Legal Counsel ("OLC") opinions – one that OLC issued to the Central Intelligence Agency in August 2002 and three that OLC issued to the CIA in May 2005.
"The President has halted the use of the interrogation techniques described in these opinions, and this administration has made clear from day one that it will not condone torture," said Attorney General Eric Holder. "We are disclosing these memos consistent with our commitment to the rule of law."
Holder also stressed that intelligence community officials who acted reasonably and relied in good faith on authoritative legal advice from the Justice Department that their conduct was lawful, and conformed their conduct to that advice, would not face federal prosecutions for that conduct.
The Attorney General has informed the Central Intelligence Agency that the government would provide legal representation to any employee, at no cost to the employee, in any state or federal judicial or administrative proceeding brought against the employee based on such conduct and would take measures to respond to any proceeding initiated against the employee in any international or foreign tribunal, including appointing counsel to act on the employee’s behalf and asserting any available immunities and other defenses in the proceeding itself.
To the extent permissible under federal law, the government will also indemnify any employee for any monetary judgment or penalty ultimately imposed against him for such conduct and will provide representation in congressional investigations.
"It would be unfair to prosecute dedicated men and women working to protect America for conduct that was sanctioned in advance by the Justice Department," Holder said.
After reviewing these opinions, OLC has decided to withdraw them: They no longer represent the views of the Office of Legal Counsel.