District of Nevada

RENO, Nev. – A man who was found in possession of 6,000 images and 20 videos of child pornography, including child rape, has been sentenced to 10 years in prison, lifetime supervised release, and ordered to pay $25,000 in restitution to various victims, announced U.S. Attorney Daniel G. Bogden, for the District of Nevada.

Andrew Wayne Hamrick, 30, of Carson City, Nev., who pleaded guilty on July 28, 2014, to one count of distribution of child pornography and one count of receipt of child pornography, was sentenced on April 6, by U.S. District Judge Miranda M. Du. Hamrick has been in custody since he was arrested in April 2014. 

“As the investigation in this case demonstrates, there are persons trolling the Internet 24 hours-a-day looking for accomplices and innocent children to harm,” said U.S. Attorney Bogden. “Thanks to the dedication and skills of these investigators and prosecutors, we are able to identify, arrest and successfully prosecute these dangerous predators.”

According to the court records, in October 2013, Hamrick engaged in a series of email and text message conversations with an FBI special agent who was posing undercover as an adult female interested in incest.  Hamrick provided the undercover agent with instructions on how to teach the undercover agent’s fictional six-year old niece to engage in sexual activity.  During the chat sessions, Hamrick emailed approximately 10 images of child pornography to the undercover agent.  In March 2014, a federal search warrant was executed at Hamrick’s home in Carson City, and agents recovered two cellular telephones that, upon forensic examination, were found to contain a total of approximately 6,000 images and 20 videos of child pornography. The images and videos included depictions of child rape, bestiality, sadistic or masochistic conduct, and bondage-related activities with both young boys and girls. Agents obtained a federal arrest warrant for Hamrick, and he was arrested in Carson City while driving his vehicle.  Law enforcement officials recovered another cellular telephone from Hamrick that had been activated only a few hours after the search warrant was served on his home.  Several more images of child pornography were recovered from the new phone. Hamrick worked as a locksmith in Carson City.

The case was prosecuted by Assistant U.S. Attorney Carla Higginbotham.  It was investigated by the FBI, Nevada Attorney General’s Office, and Northern Nevada Internet Crimes Against Children Task Force, and brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals, federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc.  For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."

         

LAS VEGAS, Nev. – A Las Vegas man who told federal homeland security officials on June 3, 2014, that he had placed explosives under the desks of two federal district court judges in Las Vegas and planned to blow them up, has been sentenced to 75 months in federal prison, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

Clifford James Schuett, 60, was sentenced by U.S. District Judge Jennifer A. Dorsey on April 7, 2015.  Schuett pleaded guilty in December 2014 to one count of threatening to kill or cause damage by explosive.

“We take all threats to federal officials and federal buildings very seriously,” said U.S. Attorney Bogden.  “Fortunately, no one was injured as a result of the threats in this case, and the perpetrator has been convicted and sentenced and is in federal custody for a lengthy period of time.”

According to the plea agreement, on June 3, 2014, Schuett entered a U.S. Immigration and Customs Enforcement (ICE) field office in Las Vegas and stated that he had placed explosives in the courtrooms and under the desks of two U.S. District Judges in the Lloyd George Federal Courthouse with the intent to kill them. Law enforcement agents detained Schuett, and notified federal courthouse security of the threat. The courthouse was searched and cleared of any threats, and no explosives were located. Schuett told the agents that he wanted to blow up one of the judges because the judge had sent him to prison, and wanted to blow up the other judge because the judge had turned down his court case.  Schuett also said that if he were released from custody, he would shoot a federal judge and would first go after the judge who had sent him to prison.  Schuett was previously convicted in March 2010 of threatening to blow up Nellis Air Force Base, and sentenced to 42 months in prison and three years of supervised release.  When Schuett was released from prison on that conviction, he failed to report to his probation officer and was sentenced in June 2013 to one additional year in prison.

This case was investigated by the FBI, ICE, and Las Vegas Metropolitan Police Department, and prosecuted by Assistant U.S. Attorney Phillip N. Smith, Jr.

LAS VEGAS, Nev.  – Dr. Dipak Desai, the former owner of a defunct Nevada endoscopy center, pleaded guilty today to conspiracy to defraud Medicare, Medicaid and other private health insurance companies by inflating and overcharging for anesthesia services it provided, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

“Dr. Desai intentionally defrauded the federal health care system for his own personal enrichment,” said U.S. Attorney Bogden. “He has finally taken responsibility for his conduct.  We are hopeful this closes a long and sordid chapter of harm caused to the people and businesses of Nevada.”

Desai, 65, of Las Vegas, pleaded guilty before U.S. District Judge Larry R. Hicks to one count of conspiracy to commit health care fraud, one count of health care fraud, and agreed to the forfeiture of property of up to approximately $2.2 million.  Desai is scheduled to be sentenced on July 9, 2015, and faces a maximum of five years in prison on the conspiracy count, 10 years in prison on the health care fraud count, and maximum fines of $250,000 on each count.

Last July, Desai’s co-defendant and chief operating office of the endoscopy center, Tonya Rushing, pleaded guilty to one count of conspiracy to commit health care fraud, and is scheduled to be sentenced on May 4, 2015.

According to Desai’s guilty plea agreement, between about January 2005 and February 2008, Desai and Rushing conspired to overcharge Medicare, Medicaid, and other private health insurance companies at the Endoscopy Center of Southern Nevada by significantly overstating the amount of time the certified registered nurse anesthetists spent with patients on a given procedure.  Desai and Rushing created a separate company, Healthcare Business Solutions, owned by Rushing, to handle the billing for the anesthesia services.  This company received approximately nine percent of all money collected for anesthesia services rendered at the endoscopy center. Desai and Rushing imposed intense pressure on the endoscopy center employees to schedule and treat as many patients as possible in a day, and instructed the nurse anesthetists to overstate in their records the amount of time they spent on the anesthesia procedures.  Desai and Rushing also instructed the office staff to rely on the false anesthesia records when preparing the claims for reimbursement which were sent to Medicare, Medicaid and the insurance companies.  The plea agreement states that the parties agreed that the amount of loss to the victims is approximately $2.2 million.

This case was investigated by the FBI, Office of the Nevada Attorney General, Health and Human Services Office of Inspector General, Department of Labor Office of Inspector General, Food and Drug Administration Office of Criminal Investigations, and the United States Postal Inspection Service, and prosecuted by Assistant U.S. Attorney Crane M. Pomerantz and Mark N. Kemberling, who was designated as a Special Assistant U.S. Attorney on this case and is Chief Deputy Nevada Attorney General.

According to a recent report by the Inspector General for the U.S. Department of Health and Human Services, for every dollar the Departments of Justice and Health and Human Services have spent fighting health care fraud, they have returned an average of nearly eight dollars to the U.S. Treasury, the Medicare Trust Fund and others. To learn more or to report Medicare fraud, go to http://www.stopmedicarefraud.gov/

LAS VEGAS, Nev. – Federal, state and local law enforcement joined arms today to announce the results of a six-month arrest surge of child predators in southern Nevada, and to discuss their ongoing efforts to identify and prosecute persons who are committing sex crimes against children in Nevada, announced Daniel G. Bogden, United States Attorney for the District of Nevada.

At a news conference in the Lloyd D. George Federal Courthouse, U.S. Attorney Bogden was joined on stage by FBI Assistant Special Agent in Charge Rick Brodsky, Clark County District Attorney Steve Wolfson, Clark County Sheriff Joe Lombardo, Nevada Attorney General Adam Laxalt, HSI Assistant Special Agent in Charge Mike Harris, U.S. Marshal Christopher Hoye, and Captain Michael Johnston of the Henderson Police Department to announce arrest and prosecution results in Operation Protect the Powerless. The Operation occurred from June 1 to Dec. 31, 2014, and resulted in the prosecution and conviction of 219 persons, the execution of 100 search warrants, and the recovery of over 500,000 images and 2,700 videos of child rape and pornography. The surge also resulted in prosecutions are being handled jointly by the U.S. Attorney’s Office and Clark County District Attorney’s Office, and resulted in distinct charges in federal and state court.

Henry Genaro Macias, 33, of Las Vegas, Nev., is a defendant who was jointly prosecuted by state and federal authorities and was sentenced during Operation Protect the Powerless. Investigators determined that Macias was using the internet to share numerous files of child pornography and at the same time was molesting minor children.  Macias pleaded guilty in federal court to receipt of child pornography and was sentenced on Dec. 4, 2014, to 12 years in prison and lifetime supervised release.  Macias also pleaded guilty in Clark County District Court to attempt lewdness with a child and was sentenced on July 29, 2014, to six to 15 years in prison.

Operation Protect the Powerless was organized and led by the Project Safe Childhood (PSC) Task Force in southern Nevada, and targeted child traffickers, persons who were coercing and enticing minors for sex, child pornographers, child molesters and child rapists.  The Task Force, comprised of federal, state and local investigators and prosecutors, was reorganized in 2013 to provide a format for weekly meetings in Las Vegas to review cases involving sex crimes against children and to determine the best venue for prosecution.  Members of the Task Force have also been participating in outreach at Clark County schools in order to educate parents and children about the dangers of the internet and unsuspecting child sex predators.  The reorganization promptly resulted in the successful six-month operation.

Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals, federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc.  For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."

LAS VEGAS, Nev. – A Gig Harbor woman has been sentenced to six months in prison for participating in an investment fraud scheme that bilked over 50 victims out of millions in cash for almost a decade, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

Constance C. Fenton, 70, was sentenced on March 2, 2015, in Las Vegas, by U.S. District Judge Jennifer A. Dorsey. Fenton was also sentenced to six months of home confinement, three years of supervised release, 40 hours of community service, and ordered to pay approximately $2.9 million in restitution. Fenton pleaded guilty in September to one count of conspiracy to commit money laundering.  She must report to federal prison by June 2, 2015.

Fenton was one of six persons charged in the investment fraud scheme.  According to the plea memoranda, the defendants lured victims into the scheme by falsely telling them that Thomas A. Cecrle, Jr., 57, of Henderson, Nev., worked as a contractor for the U.S. Department of Homeland Security, purchasing and selling water rights worth millions of dollars as part of a secret government program.  The conspirators then solicited money by falsely claiming that Cecrle needed short-term cash loans to complete his phantom water deals, loans he promised to repay in short order along with a very large return.  Cecrle and his co-conspirators concocted a similar story involving a land deal on the Las Vegas Strip where Cecrle needed short-term loans to supposedly close a deal with Sir Richard Branson.  In truth, however, Cecrle held no position with the federal government and there were no land or water rights deals.

Fenton became the voice of the fraud and ran Cecrle’s “boiler room.” As new victims were introduced to the scheme, Cecrle turned them over to Fenton, who quickly established a rapport over the telephone, maintained contact and commiserated with them when the payout never happened, but always reassuring them that it would happen soon if a little more money was poured into the deal.  Fenton also told the victims that she was invested and like them, was also expecting a return. Fenton portrayed herself as a religious person and often appealed to the religious beliefs of the victims.  Fenton dealt with victims across the United States, at all time of the day and night and, with few exceptions, always by telephone and email, never meeting them face-to-face.

Using his office as a family court judge in Clark County, Nev., defendant Steven E. Jones, 57, of Henderson, Nev., knowingly vouched for Cecrle and the legitimacy of the deals to potential investors when he knew the deals were, in fact, scams. Jones continued to further the conspiracy by receiving money from a victim in the parking lot of the Family  Division Courthouse, meeting with at least one potential investor in his chambers and elsewhere in the courthouse to discuss the investment,  obtaining an “Own Recognizance” bond to release Cecrle from custody after he was arrested for bad checks he had passed to a victim, and opening and maintaining a joint checking account with Cecrle, through which flowed over $260,000 in illegal proceeds.

During the entire conspiracy, which lasted from about September 2002 to October 2012, the defendants defrauded at least 22 victims of more than $2.6 million, money they quickly converted to their own use.

All of the co-defendants pleaded guilty and have been sentenced. Cecrle was sentenced on March 2, 2015, to 6½ years in prison. Jones was sentenced on Feb. 25, 2015, to 26 months in prison. Terry J. Wolfe, 59, of Henderson, Nev., was sentenced on Feb. 19, 2015, to time served, having served approximately 16 months in pretrial detention. Mark L. Hansen, 56, of Corvallis, Ore., was sentenced on Jan. 27, 2015, to four months in prison. Ashlee M. Martin, 31, of Las Vegas, Nev., entered into a 12-month pretrial diversion agreement with the government.

The case was investigated by the FBI and prosecuted by First Assistant U.S. Attorney Steven W. Myhre and Assistant U.S. Attorney Daniel R. Schiess of the U.S. Attorney’s Office for the District of Nevada.

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

LAS VEGAS, Nev. – Former Clark County Family Court Judge Steven E. Jones was sentenced today by U.S. District Judge Jennifer A. Dorsey to 26 months in prison, three years of supervised release, and ordered to pay approximately $2.9 million in restitution for participating in an investment fraud that bilked over 50 investor victims out of millions in cash for almost a decade, announced U.S. Attorney Daniel G. Bogden for the District of Nevada and Laura Bucheit, Special Agent in Charge of the FBI for Nevada.

Jones, 57, of Henderson, Nev., who served for almost 20 years as a family court judge in Clark County, pleaded guilty in September to one count of conspiracy to commit wire fraud.  He was permitted to self-surrender to federal prison by May 25, 2015.  Jones’ sentence was enhanced for violating his position of trust, and because the loss amount was over $200,000 and there were more than 10 victims. Jones resigned his position as judge and surrendered his Nevada law license in September as one of the conditions of his plea agreement.

“Former Judge Steven Jones played an integral part in this investment fraud scheme and was the most prominent and indispensable member,” said U.S. Attorney Bogden. “This crime was not a “one-off” for Jones, but a calculated and deliberate decision that he replicated for years. He knew right from wrong, but engaged in the conduct anyway because he could.”

"This sentencing reaffirms to the public that the FBI will continue to make certain that no one is above the law, and when public corruption is identified, it will be aggressively investigated and prosecuted,” said Special Agent in Charge Bucheit.

All of the co-conspirators charged in the fraud scheme have also pleaded guilty. Thomas A. Cecrle, Jr., 57, of Henderson, Nev., and Constance C. Fenton, 70, of Gig Harbor, Wash., are scheduled to be sentenced on March 2. Terry J. Wolfe, 59, of Henderson, was sentenced on Feb. 19, to time served, three years of supervised release, and ordered to pay approximately $2.9 million in restitution.  Mark L. Hansen, 56, of Corvallis, Ore., was sentenced on Jan. 27, 2015, to four months in prison, three years of supervised release, and ordered to pay approximately $2.9 million in restitution. Ashlee M. Martin, 31, of Las Vegas, Nev., entered into a 12-month pretrial diversion agreement with the government.

According to the plea memoranda, defendants lured victims into a fraud scheme by falsely telling them that Cecrle worked as a contractor for the U.S. Department of Homeland Security, purchasing and selling water rights worth millions of dollars as part of a secret government program.  The co-conspirators then solicited money by falsely claiming that Cecrle needed short-term cash loans to complete his phantom water deals, loans he promised to repay in short order along with a very large return.  Cecrle and his co-conspirators concocted a similar story involving a land deal on the Las Vegas Strip where Cecrle needed short-term loans to supposedly close a deal with Sir Richard Branson.  In truth, however, Cecrle held no position with the federal government and there were no land or water rights deals.

Using his office as an elected state court judge, defendant Jones knowingly vouched for Cecrle and the legitimacy of the deals to potential investors when he knew the deals were, in fact, scams.  According to the plea memorandum, Jones continued to further the conspiracy by receiving money from a victim in the parking lot of the Family  Division Courthouse, meeting with at least one potential investor in his chambers and elsewhere in the courthouse to discuss the investment,  obtaining an “Own Recognizance” bond to release Cecrle from custody after he was arrested for bad checks he had passed to a victim, and opening and maintaining a joint checking account with Cecrle, through which flowed over $260,000 in illegal proceeds.  During the entire conspiracy, which lasted from about September 2002 to October 2012, the defendants defrauded at least 22 victims of more than $2.6 million, money they quickly converted to their own use.

The case was investigated by the FBI and prosecuted by First Assistant U.S. Attorney Steven W. Myhre and Assistant U.S. Attorney Daniel R. Schiess of the U.S. Attorney’s Office for the District of Nevada.

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

LAS VEGAS, Nev. – A Las Vegas man and his mother have been indicted by the federal grand jury on charges that they destroyed the mini-mart store they owned in North Las Vegas in order to collect the insurance proceeds, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

Peter Argyris, 46, of Las Vegas, and his mother, Joann Argyris, 67, of Boulder City, Nev. are charged with conspiracy to commit arson, arson resulting in death, use of fire to commit mail fraud, six counts of mail fraud, and criminal forfeiture. They were arrested yesterday evening by ATF Special Agents, and are scheduled for an arraignment and plea at 3:00 p.m. today before U.S. Magistrate Judge George Foley, Jr. If convicted, they face up to life in prison on the conspiracy and arson charges, 10 years consecutive on the use of fire to commit mail fraud charge, up to 20 years in prison on each mail fraud charge, and fines of up to $250,000 on each count.

“The allegations against the defendants are very serious,” said U.S. Bogden. “Not only did the fire destroy the property, but a life was lost. We will use federal resources to ensure that the persons who committed this crime for monetary gain are convicted and punished.”

"Death by an act of arson is a heinous crime and leaves a devastating impact on the victim’s family and the community," said Special Agent in Charge, Joseph M. Riehl. "ATF and its partners will aggressively pursue this investigation and bring those responsible to justice."

According to the allegations in the indictment, in 2010, the defendants and their company, Argyris Enterprises, LLC, owned a commercial property located at 3820 E. Craig Road in North Las Vegas, which housed a gas station, convenience store and restaurant called the JCW Mini-Mart. The defendants held an insurance policy on the property for approximately $4.7 million. From about June to September 2010, the defendants conspired and devised a scheme to intentionally burn down the mini-mart in order to collect the insurance proceeds. On Sept. 19, 2010, the defendants caused the mini-mart to be destroyed by fire, which resulted in the death of B.D. In December 2010, Peter Argyris submitted an insurance claim seeking approximately $1.4 million for the replacement cost of the building and loss of business income, and falsely represented that the fire damage did not originate by any act of his own.

This case is being investigated by ATF, the North Las Vegas Fire Department, and the North Las Vegas Police Department, and is being prosecuted by Assistant U.S. Attorney Phillip N. Smith, Jr.

 

RENO, Nev. – Michael Stickler, 54, of Reno, was sentenced on Monday, Feb. 9, 2015, by U.S. District Judge Miranda M. Du to 2½ years in federal prison, three years of supervised release, 100 hours of community service, and ordered to pay $200,000 in restitution to the U.S. Department of Health and Human Services and $100,899 to the IRS for his convictions on theft of federal grant money and failing to pay employment taxes, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

“Government programs are often the victims of scams and fraud,” said U.S. Attorney Bogden. “If you steal from a federal program, you risk being investigated, prosecuted and sent to prison.”

Stickler owned and operated a company in Reno called Faith Based Solutions from 1999 to 2009. In 2007, Faith Based Solutions, received $500,000 in federal grant money to teach non-profit organizations how to apply for federal government grants. Part of the grant terms required that $200,000 of the grant funds be paid to sub-grantees. However, Stickler drew down all of the grant funds in the first seven months of the grant period and no money was ever provided to any sub-grantee. Rather, Stickler put the money in accounts that he controlled and used it to pay large salaries to himself and family members, to take elaborate vacations, and for other items that were not approved by the grant. Stickler also collected and withheld employment and FICA taxes from his employees’ wages, but failed to pay them over to the IRS.

Stickler pleaded guilty to one tax charge and was convicted by a jury of the theft charge.  He is released on a personal recognizance bond and must report to federal prison by May 11, 2015.

The cases were investigated by IRS Criminal Investigation and the U.S. Department of Health and Human Services Office of Inspector General. They were prosecuted by Assistant U.S. Attorney Carla B. Higginbotham.

LAS VEGAS, Nev. – In another case of fraud involving the solicitation of money in exchange for business grants, a Las Vegas man has pleaded guilty to conspiracy to commit wire fraud, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

Mickey Gines, 41, pleaded guilty on Monday, Feb. 2, before U.S. District Judge Gloria M. Navarro to one count of conspiracy to commit wire fraud. Gines is scheduled to be sentenced on June 4, 2015, at 10 a.m., and faces up to 20 years in prison and a fine of up to $250,000.

Two others were also charged in the case. Christine M. Gagnon, aka Crystal Waters, 35, of Escanaba, Mich., pleaded guilty in November to conspiracy to commit wire fraud and is scheduled to be sentenced on March 19, and Gregory Villegas, aka Ray Matsui, aka Ray Mathis, 35, of Las Vegas, is scheduled for trial on March 16. Villegas is in federal custody pending trial.

According to the plea agreement, beginning on about March 1, 2008, and continuing to about May 2, 2012, the defendants entered into a conspiracy to induce small business owners to pay them money for grants that the defendants never intended to pursue. The defendants made numerous false statements to the victims in order to convince them to pay the advance monies, including that they were pre-qualified for or guaranteed “free” private and government grants; that they would partner them with private foundations or government grant programs; that they had obtained grants for other victims; that they would hold their monies in an escrow account; and that their fees were refundable if they did not receive the grants. The defendants knew that their representations were not true, and that they never intended to obtain grants for the victims. Once the defendants received money from the victims, they converted it to their own use. The defendants operated grant funding companies under multiple and evolving names, including BFS Enterprises, Inc. and Global Business Funding, Inc., and used multiple aliases in order to advance the scheme. The defendants repeatedly solicited victims for additional money for goods and services and lulled the victims with false promises of funding and excuses for delays in order to avoid investigation by law enforcement and consumer protection agencies. Using this scheme, the amount of loss that the defendants caused to at least 390 victims was approximately $5.3 million.

This case was investigated by the U.S. Secret Service and FBI and is being prosecuted by Assistant U.S. Attorney Christina M. Brown.

RENO, Nev. – A man who held a federal firearms dealer’s license and owned an indoor shooting range in Reno, Nev., has pleaded guilty to charges that he unlawfully sold multiple firearms, including guns with obliterated serial numbers and machine guns, to undercover ATF agents at his business in April and May 2014, announced U.S. Attorney Daniel G. Bogden for the District of Nevada and ATF Special Agent in Charge Joseph M. Riehl.

James David Harwin, 59, of Reno, pleaded guilty on Thursday, Jan. 29, before U.S. District Judge Miranda M. Du to one count of transfer of a firearm in violation of the National Firearms Act. Harwin is scheduled to be sentenced on May 4, 2015, at 1:30 p.m., and he faces up to 10 years in prison and a fine of up to $250,000.

“Federally licensed firearms dealers are entrusted to uphold federal laws pertaining to the importation, manufacture and sales of firearms,” said U.S. Attorney Bogden. “We will be especially vigilant in our investigations and prosecutions of firearm dealers who consciously choose to violate these laws.”

“A licensed federal firearms dealer who intentionally circumvents the law and commits federal firearm violations will be held accountable,” said ATF Special Agent in Charge Riehl. “This is a serious crime and it is critical for FFL’s to comply with federal regulations to ensure the safety of our communities.”

According to the plea agreement, Harwin and Safe Shot LLC possessed a federal firearms license (FFL) to manufacture and sell firearms. Safe Shot LLC did business as the Safe Shot Indoor Shooting Range, located at 9425 Double R Boulevard in Reno. On or about April 17, 2014, Harwin unlawfully sold four handguns to two undercover ATF agents who told Harwin they were residents of Sacramento, Calif. One of the handguns had an obliterated serial number. On May 2, 2014, Harwin sold a machine gun with an obliterated serial number to the undercover ATF agents, and on May 29, 2014, Harwin unlawfully sold a Street Sweeper shotgun and three machine guns to the undercover agents. Harwin removed the serial numbers on one of the machine guns in the presence of the undercover agents.

This case was investigated by ATF and is being prosecuted by Assistant U.S. Attorney Megan Rachow.

LAS VEGAS, Nev. – A Las Vegas man has been arrested on wire fraud charges for taking hundreds of thousands in fees from persons who thought the payments would help them obtain loans for various business ventures, announced U.S. Attorney Daniel G. Bogden for the District of Nevada and Laura A. Bucheit, Special Agent in Charge of the FBI for Nevada.

Ronald Gene Morgan, 60, was arrested by FBI agents in Las Vegas on Jan. 29. He is charged in a criminal indictment with 13 counts of wire fraud and criminal forfeiture. Morgan appeared before U.S. Magistrate Judge Cam Ferenbach on Jan. 29, and pleaded not guilty to the charges. At a detention hearing today, Morgan was released on a personal recognizance bond pending a March 30 trial date.

“We have been working diligently with our federal, state and local investigative partners to catch and prosecute persons who are committing advance fee fraud crimes,” said U.S. Attorney Bogden. “The persons who commit these offenses portray themselves as legitimate business persons, when in reality they are nothing more than con artists.”

According to the indictment, from about March 2009 to April 2011, Morgan resided in Las Vegas and operated an Illinois-incorporated company, Argent Asset Management, and a Florida-incorporated company, Argent securities (Argent). Morgan allegedly used numerous means, including the mail, internet, and telephone to advertise a fraudulent bond-offering program. Morgan promised persons that for an advance fee, he would provide them with business loans by using Argent’s assets to acquire bank bonds at a discount. Morgan told the victims that he would then re-sell the bonds at face value to an investor, generating hundreds of millions of dollars that would be available in funding to them for their various business ventures. As part of the scheme, Morgan required advance fees from victims in amounts as high as $780,000, and told victims that the fees would be held in escrow; would be refunded if loans were not obtained; and would be used solely for purposes relating to obtaining the loan. Morgan knew Argent had no assets and acquired no bonds. Morgan converted the fees he received from the victims to personal uses such as travel and entertainment, and also used them to promote and conceal the scheme to defraud. Morgan continued to solicit and accept victims’ fees while knowingly providing false excuses for funding delays when he knew he had converted victim fees to his own personal use, causing losses to victims of more than 3 million dollars.

If convicted, Morgan faces a maximum of 20 years in prison and a $250,000 fine on all counts.

The case is being investigated by the FBI, and prosecuted by Assistant U.S. Attorney Christina M. Brown.

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

The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

LAS VEGAS, Nev. – Four persons have been charged with conspiracy and fraud for obtaining money from small business owners for grant funding and services that they never provided or intended to provide, announced U.S. Attorney Daniel G. Bogden for the District of Nevada and Laura A. Bucheit, Special Agent in Charge of the FBI for Nevada.  

Jason Demko, 38, Lorraine Riddiough, 66, Lissette Alvarez, 27, all of Las Vegas, and Mark Jones, 32, of Barberton, Ohio, are charged in a criminal indictment with one count of conspiracy to commit mail fraud and wire fraud, five counts of wire fraud, and criminal forfeiture.  Riddiough, Alvarez, and Jones were arrested in Las Vegas yesterday.  They appeared yesterday before Magistrate Judge Ferenbach and pleaded not guilty to the charges, and were released on personal recognizance bonds pending a March 16 trial date.  Demko is scheduled to appear before U.S. Magistrate Judge Cam Ferenbach at 3:00 p.m. today for an arraignment.

“Unfortunately, advance fee fraud schemes are very common,” said U.S. Attorney Bogden. “The con artist will ask for money up front before any tangible service or product is provided, and it will be very difficult to get your money back once you have turned it over to the scammers.”

“These arrests emphasize the FBI's continued commitment to investigate financial crimes,” said Special Agent in Charge Bucheit. “It also serves as a reminder for consumers to protect themselves, and remember if it seems too good to be true, it almost always is."

According to the indictment and other court records, from about January 2013 to February 2014, the defendants allegedly made false and fraudulent representations and promises to small business owners to persuade and induce them to pay initial fees, usually between $2,500 and $5,000 for goods and services they thought would help them obtain grants for their businesses.  The business owners were told that the total cost for obtaining a grant was between $10,000 and $15,000, depending on the total amount of funding requested, and that the remaining fees would not be charged until the owners received 100 percent of the grant funding.  Among other things, the defendants falsely stated that they represented a company named Foundation Processing Center in Wilmington, Del., when in fact, they represented JCD Business Services in Las Vegas; falsely stated that only certain clients had qualified for grants, when in fact anyone who paid the fees were qualified by the defendants; and stated that they had obtained grants for other clients, when in fact they had not done so.  The defendants also re-solicited clients for additional fees, including business plans, when they knew that the plans were not going to assist the clients in obtaining any grants.  The defendants knew that the true purpose of their solicitations was to obtain funds to personally enrich themselves.

If convicted, the defendants face a maximum of 20 years in prison and a $250,000 fine on all counts.

The case is being investigated by the FBI, and prosecuted by Assistant U.S. Attorney Sarah E. Griswold.

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

The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

WASHINGTON - The U.S. Court of Appeals for the Ninth Circuit today affirmed the convictions of a former Nevada lobbyist for making excessive campaign contributions and contributions in the name of another person, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Daniel G. Bogden of the District of Nevada.

“We're pleased that today's decision confirms that the cornerstones of our campaign finance laws - contribution limits and transparency - are not subject to creative misinterpretations of those determined to break the law,” said Assistant Attorney General Caldwell.

“Harvey Whittemore knew the law, he knew how to raise money the right way, he knew right from wrong, and he knew how he could violate the law and avoid detection,” said U.S. Attorney Bogden.  “He made a conscious and willful choice to violate federal elections laws in order to increase his own power and influence at the expense of the voting public and the election process.”

F. Harvey Whittemore, 62, of Reno, Nevada, a prominent Nevada lawyer, former lobbyist and land developer, was convicted by a jury in the District of Nevada in May 2013 of making excessive campaign contributions, making contributions in others’ names, and causing a materially false statement to be made to the Federal Election Commission (FEC).  He was sentenced on Sept. 30, 2013, to two years in prison and a $100,000 fine.

According to evidence presented at trial, Whittemore was aware of the strict limits on individual federal campaign contributions.  In an effort to circumvent those limits, he devised a scheme to unlawfully funnel more than $130,000 of his own money through approximately 29 family members, employees and their spouses to the campaign committee for a U.S. senator.  This scheme allowed Whittemore to make an individual campaign donation in excess of the federal limits. Whittemore concealed the scheme from the FEC, the senator, and the senator’s campaign committee.

       
The case was investigated by the FBI and prosecuted by Deputy Chief Eric G. Olshan of the Criminal Division’s Public Integrity Section and First Assistant U.S. Attorney Steven W. Myhre of the District of Nevada.  Appellate Chief and Assistant U.S. Attorney Elizabeth Olson White of the District of Nevada argued the appeal.

LAS VEGAS, Nev. – A woman who served as the getaway driver for the robberies of 13 banks and stores in southern Nevada from December 2012 to March 2013, has been convicted by a federal jury of multiple counts of robbery and firearm charges, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

Sesley Williams, 46, of Las Vegas, was convicted on Friday, Jan. 16 of eight counts of bank robbery, five counts of interference with commerce by robbery and five counts of brandishing a firearm in furtherance of a crime of violence.  Williams is scheduled for sentencing before U.S. District Judge Andrew P. Gordon on May 21, 2015.  She faces up to 20 years in prison on each robbery count and a mandatory minimum of 107 years in prison on the brandishing counts, which must run consecutively to the sentences for the other counts.

The co-defendant, Anthony Jordan, was convicted by a jury in November 2014 of 13 counts of robbery and firearm-related charges, and is scheduled to be sentenced on March 19, 2015.

The duo robbed six banks, three outlet mall and one other store in Las Vegas, two banks in Henderson, and one outlet mall store in Primm, Nev., between Dec. 28, 2012, and March 30, 2013.

This case was investigated by the Las Vegas Metropolitan Police Department, as part of the Safe Streets Task Force and Project Safe Neighborhoods program.  The case was prosecuted by Assistant U.S. Attorney Lisa Cartier-Giroux.

LAS VEGAS, Nev. – A Las Vegas lawyer who served as the U.S. Attorney for Nevada during the 1970’s, was sentenced today to 18 months in prison, one year of supervised release, and ordered to pay approximately $290,000 in restitution to the IRS for failing to file individual and corporate income tax returns from 2006 to 2010, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

Lawrence J. Semenza, II, 72, pleaded guilty in August 2014 to three misdemeanor counts of willful failure to file a tax return, and was sentenced by U.S. District Judge James C. Mahan. Semenza must report to federal prison by April 17, 2015.

“The consequences of failing to file your tax returns can be very serious,” said U.S. Attorney Bogden.  “At the end of the day, you are better off filing your return than facing penalties such as wage garnishments, asset seizures, prosecution, and, as in this case, prison time.”

“It is especially egregious that a former federal prosecutor should try to skirt his own tax obligations,” said John Collins, Special Agent in Charge of IRS Criminal Investigation for Nevada.  “American taxpayers have a right to expect that everyone will be held to the same standard of tax compliance.  No one, regardless of current or former position, is above the law.”

According to the guilty plea agreement, Semenza operated his law practice in Las Vegas as a subchapter C personal service corporation. For the years 2006 through 2010, Semenza individually had taxable income of approximately $655,000, and the corporation had taxable income of approximately $345,000, but Semenza failed to file individual or corporate income tax returns for those years, and failed to pay the tax due and owing to the IRS, totaling about $290,000.

           The case was investigated by IRS Criminal Investigation and prosecuted by Assistant U.S. Attorneys Eric Johnson and Nicholas D. Dickinson.

LAS VEGAS, Nev. – A Las Vegas man who robbed 13 convenience stores and a small casino in the Las Vegas area during 2013, was sentenced today by U.S. District Judge Gloria M. Navarro to multiple life terms in prison, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

Abdul Howard, 49, was convicted by a jury last June of one count of felon in possession of a firearm, 14 counts of interference with commerce by robbery, and 12 counts of possession of a firearm during, in relation to, and in furtherance of a crime of violence.  A number of the life terms were ordered to be served consecutively.  There is no parole in the federal system.

“This defendant, who has a lengthy criminal history, terrorized convenience store employees in Las Vegas over a four month period during 2013, and it is fortunate that no one was killed,” said U.S. Attorney Bogden.  “With his federal sentence of life in prison, Mr. Howard’s violent crime reign on Nevada streets and in our community is now over and done.”

Howard robbed 13 convenience stores and one casino in the Las Vegas area between January 15 and April 16, 2013.  Howard robbed most of the businesses late at night using a semi-automatic handgun which he used to threatened store employees and some customers.  In some of the robberies, Howard pointed the handgun at an employee or stuck a gun into the employee’s body or head.  In one instance, Howard fired a handgun at an employee, and in another, Howard shot an employee in the neck.  Investigators dubbed Howard the “Cinched Hoodie Robber,” because he typically entered the businesses wearing a hooded sweatshirt with the hood “cinched” up around his face in an effort to conceal his identity.

Howard has at least five prior felony convictions in New York, Florida, and Nevada related to robbery, burglary, cocaine distribution and sexually motivated coercion.

This case was investigated by the FBI, Las Vegas Metropolitan Police Department, and North Las Vegas Police Department, as part of the Safe Streets Task Force and Project Safe Neighborhoods program, and prosecuted by Assistant U.S. Attorneys Phillip N. Smith, Jr. and Cristina D. Silva.

LAS VEGAS, Nev. – A Las Vegas man who earned over $7 million during 2007 and failed to file a 2008 federal tax return with the IRS, was sentenced today to 10 months in prison,  one year of supervised release, and ordered to pay approximately $2.5 million in restitution to the IRS, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

“We work with the IRS to enforce the nation's tax laws,” said U.S. Attorney Bogden.  “We will do this fully, fairly, and consistently, through both criminal and civil litigation, in order to promote voluntary compliance with the tax laws and to maintain public confidence in the integrity of the tax system.”

Shawn Lampman, 49, was sentenced by U.S. District Judge James C. Mahan. Lampman was originally charged in April 2013 and pleaded guilty on April 14, 2014, to one count of failure to file an individual tax return. He must report to federal prison by April 6, 2015.

According to the guilty plea agreement, during 2007, Lampman earned income in excess of $7 million and willfully failed to make and file an individual tax return with the IRS on or before April 15, 2008.

The case was investigated by IRS Criminal Investigation and prosecuted by First Assistant U.S. Attorney Steven W. Myhre.

LAS VEGAS, Nev. – A Las Vegas man who formerly operated a well-known local adult entertainment club and owned an escort service business, was sentenced today by U.S. District Judge Phillip M. Pro to 15 months in prison for his guilty plea to tax evasion, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

Emannouil “Manny” Varagiannis, 44, was also ordered to pay $230,651 in restitution and to forfeit two homes in Las Vegas. Varagiannis was originally charged in September 2012, and pleaded guilty on April 9, 2014, to one count of tax evasion. He must report to federal prison by April 3, 2015.

“We work with the IRS to enforce the nation's tax laws,” said U.S. Attorney Bogden.  “We will do this fully, fairly, and consistently, through both criminal and civil litigation, in order to promote voluntary compliance with the tax laws and to maintain public confidence in the integrity of the tax system.”

According to the guilty plea agreement and court records, IRS Criminal Investigation began investigating Varagiannis in 2012 as a result of him conducting unusual banking activities.  At that time, Varagiannis was the owner of Midnight Entertainers, an adult escort service in Las Vegas. The investigation revealed that Varagiannis was structuring deposits into two financial institution accounts in order to avoid reporting the money to the IRS.  Specifically, between Jan. 6, 2009, and Aug. 16, 2012, Varagiannis made 182 deposits totaling approximately $1.5 million.   Further investigation revealed that Varagiannis and his wife used the funds from the two accounts to purchase two separate homes for cash.  Further investigation also revealed that Varagiannis failed to declare federal taxes he owed for the years 2009 through 2011, totaling $230,651, and that he willfully took affirmative steps to evade or defeat payment of the taxes, including conducting transactions to avoid financial institution reporting requirements to the IRS.

The case was investigated by IRS Criminal Investigation and the Las Vegas Metropolitan Police Department, and prosecuted by Assistant U.S. Attorney Cristina D. Silva.

  LAS VEGAS, Nev. – Seven persons have been charged by the federal grand jury in Las Vegas with using fraud and deception to steal money from small business owners who thought they were receiving assistance in obtaining grants for their businesses, announced U.S. Attorney Daniel G. Bogden for the District of Nevada and Laura A. Bucheit, Special Agent in Charge of the FBI for Nevada.  

Mark L. Bausch, aka Mark Eting, 40, Alan W. Rodrigues, 55, David Bergstrom, 49, Jonas Bowen, 61, Rachel Glaser, 74, Lee Panelli, 66, all of the Las Vegas area, and Craig Rudolph, 43, of Wonder Lake, Ill., are charged in a criminal indictment with one count of conspiracy to commit wire fraud and 31 counts of wire fraud.  Bausch and Rodrigues are also charged with six counts of money laundering.  Defendants Bausch, Rodrigues, Glaser, and Panelli were arrested this morning in Las Vegas. They appeared this afternoon before U.S. Magistrate Judge Nancy J. Koppe and pleaded not guilty to the charges, and were released on personal recognizance bonds with conditions pending trial.  Defendant Rudolph was arrested in Chicago this morning and will be scheduled for a court appearance in Las Vegas in the near future.  Defendants Bergstrom and Bowen are scheduled to surrender to federal authorities next week.

            “Paying money to someone in anticipation of receiving something of greater value—such as a loan, contract, investment, or gift, is a risky proposition,” said U.S. Attorney Bogden. “You should always ask yourself if you have any guarantee that the person requesting your money will use it in the manner upon which you agreed. If the opportunity seems too good to be true, it probably is.”

“Today’s arrests highlight the FBI’s commitment to investigate financial crimes and the continued need for consumers to be cautious and protect themselves,” said Special Agent in Charge Bucheit.

            According to the indictment, from about 2007 to 2010, the defendants allegedly organized and operated four telemarketing companies, Small Business Funding Co., Inc., Company Funds, Inc., Foundation Research, Inc., and Silver State Holding Company. In exchange for fees, the defendants offered to help small business owners obtain grants from public and private entities. The defendants made false statements and promises to the victims to make it appear that they were likely to or guaranteed to receive a grant. The defendants hired salespersons to market the services and to provide false information to the customers. In order to convince the customers that the service was legitimate, the defendants instructed their employees to conduct research about funding entities and send letters to customers and funders, knowing that many of the customers would not qualify for the grants.  The defendants also solicited customers by conducting seminars throughout the United States.  Through the entire scheme, the telemarketing companies received numerous complaints, and the defendants made false statements to them to prevent or delay them from contacting law enforcement.  The defendants used the proceeds from the scheme to enrich themselves.

If convicted, the defendants face a maximum of 20 years in prison on all counts.  Additionally, there is a maximum $250,000 fine on the conspiracy and each wire fraud count, and a maximum fine of $500,000 on each money laundering count.

The case is being investigated by the FBI and IRS Criminal Investigation, and prosecuted by Assistant U.S. Attorney Daniel R. Schiess.

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

The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

   LAS VEGAS, Nev. – The owner of CLS Transportation, a Las Vegas, Nev. limousine company, has pleaded guilty to a federal racketeering charge for using the company to commit and promote criminal activities, including prostitution, drug trafficking, and financial fraud, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

            Charles Horky, 54, of Las Vegas, pleaded guilty on Thursday, Dec. 18, before U.S. District Judge Robert C. Jones to one count of conspiracy to conduct or participate in an enterprise engaged in a pattern of racketeering activity.  Horky faces up to 20 years in prison and a $250,000 fine, and is scheduled to be sentenced on April 16, 2015.

             “As this case demonstrates, persons who commit serious criminal offenses as part of an organized criminal enterprise, including prostitution, drug dealing and credit card and bank fraud, will be charged with federal racketeering crimes,” said U.S. Attorney Bogden. “Through the guilty pleas of these defendants and the dismantling of their racketeering organization, law enforcement has closed the books on Charles Horky and his coconspirators and the limousine service used to further a number of criminal activities and schemes.”

            Five others charged in the scheme have also pleaded guilty, including CLS office manager Kimberly Flores, CLS accountant and financial advisor Archie Granata, two limousine drivers, James Reda and Clarence Adams, and Solomon Zemedhun, who was supplying controlled substances to the organization.  Two other limousine drivers and a drug supplier are pending trial.

According to Horky’s plea agreement, Horky owned a controlling interest in and was the managing member of CLS Nevada, LLC, which operated as CLS Transportation, Las Vegas. Beginning no later than September 2008 and continuing through November 2012, Horky and his co-defendants used the limousine service to conduct and facilitate a broad range of criminal activities, including selling controlled substances, facilitating illegal prostitution, credit card fraud, bank fraud and check-kiting.  Horky encouraged and directed the criminal activity, and required drivers to pay him a cut of the money they were receiving from the criminal activities.

In addition to distributing illegal drugs from CLS limousines and procuring prostitutes for CLS customers, Horky, Flores, and Granata devised and executed a scheme to defraud American Express by placing fraudulent unauthorized transactions on the American Express accounts of CLS customers. Many of the customers disputed the charges, and American Express notified CLS of the fraudulent transactions and executed charge-backs.  American Express eventually cancelled the CLS Transportation account, but the defendants perpetuated the fraudulent scheme by opening successive additional American Express merchant accounts under false names, aliases and nominees. In this manner, Horky, Flores, Granata and others, fraudulently obtained more than $2.8 million from American Express.  Horky, Flores and Granata also devised a check-kiting scheme in which they drew checks on CLS Transportation’s payroll account knowing that the account did not contain sufficient funds. Horky, Flores, and Granata knowingly issued themselves and their associates thousands of checks on the account without sufficient funds to honor the checks.

The plea agreement also states that Horky agreed to the entry of a criminal forfeiture money judgment of $5.2 million.   He is released on a personal recognizance bond pending sentencing.

The case is being investigated by the FBI and the Las Vegas Metropolitan Police Department through the Safe Streets Task Force.

   LAS VEGAS, Nev. – A suspended Las Vegas doctor who was prescribing and obtaining controlled substances at local pharmacies in the name of a deceased patient, pleaded guilty today to the federal felony offense of obtaining controlled substances by fraud, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

            Kent Swaine, 50, of Las Vegas, entered his guilty plea before U.S. District Judge Richard F. Boulware, and is scheduled to be sentenced on April 18, 2015. Swaine faces a maximum penalty of four years in prison and a $250,000 fine.

 “The Centers for Disease Control and Prevention has classified prescription drug abuse as an epidemic,” said U.S. Attorney Bogden. “We are acutely aware that this is a problem which cannot be addressed through law enforcement action alone, and have been working with community partners in three other major areas to prevent and reduce prescription drug abuse, education, monitoring, and medication disposal.”

            According to the court records, Swaine was originally licensed to practice medicine in Nevada in July 2001, and operated a medical practice at 5380 S. Rainbow Boulevard in Las Vegas. In January 2014, the Las Vegas DEA initiated an investigation into Swaine following a complaint that Swaine was writing prescriptions and obtaining controlled substances at several Las Vegas pharmacies in the name of a deceased patient. The investigation determined that Dr. Swaine was impersonating a deceased individual in order to obtain controlled substances. Swaine was arrested and charged by federal criminal complaint in August.  At the guilty plea today, Swaine admitted that he had been fraudulently writing and filling prescriptions for Hydromorphone (generic Dilaudid), in the name of a patient who died in August 2011, for the purpose of his own drug addiction.

            According to the State Medical Board’s website, Swaine’s license to practice is currently suspended indefinitely.

Next Wednesday and Thursday, Dec. 17 to Dec. 18, the U.S. Attorney’s Office is co-sponsoring with the Nevada High Intensity Drug Trafficking Area Task Force (Nevada HIDTA) an annual training summit in Las Vegas to address prescription drug abuse. In addition to law enforcement, medical, treatment and pharmacy providers, as well as community and family service agency representatives are welcome to attend.  For more information and to register go to: http://www.nvhidta.org/default.aspx?menuitemid=694.

The case was investigated by the HIDTA Pharm-Net Task Force, and prosecuted by Assistant U.S. Attorney Crane M. Pomerantz.

   LAS VEGAS, Nev. – A Katy, Texas couple who owned two mortgage service businesses in Henderson, Nev., have been sentenced to prison for their roles in a mortgage fraud scheme that caused over $30 million in losses to federally insured financial institutions, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

            Derrick Phelps, 46, former owner of Investors Realty and Enterprise Mortgage Services, was sentenced to 70 months in prison, and his wife, Cynthia Phelps, 44, was sentenced to four years in prison.  Both defendants were also ordered to serve five years of supervise release and to pay approximately $31 million in restitution.  They were sentenced by U.S. District Judge James C. Mahan on Tuesday, Dec. 2, and were permitted to self-report to federal prison by March 6, 2015.  They pleaded guilty in April to one count of conspiracy to commit bank fraud, mail fraud and wire fraud and seven counts of bank fraud. 

“Hundreds of mortgage industry employees and business owners have been convicted of fraud and sentenced to prison for defrauding the financial institutions during the housing boom in southern Nevada,” said U.S. Attorney Bogden. “We are continuing to work with our local, state and federal law enforcement partners to pursue all sorts of financial fraud cases that impact the entire community.”

             According to their plea agreements, from about January 2003 to November 2006, the defendants devised a scheme to defraud federally insured financial institutions through the use of false mortgage applications.  The defendants solicited buyers with good credit ratings to purchase homes in the Las Vegas area and made offers to purchase the homes above the sellers’ asking prices. In some instances, the defendants caused buyers to purchase multiple houses at or about the same time, so that the purchases would not show up on their credit report and the lenders would not be aware of the other purchases.  The defendants then caused false information to be placed in the buyer’s mortgage loan applications pertaining to things such as income and intent to occupy the home. Once the loans were approved, the defendants caused the sellers to agree that part of the excess funds be redirected to the buyers under the pretense of making upgrades and repairs to the properties.  The defendants intentionally concealed from the financial institutions that buyers were receiving part of the loan disbursements for their own use and benefit.  The defendants defaulted on the mortgage loans which caused the properties to go into foreclosure.  Using this scheme, the defendants purchased approximately 233 properties and caused losses to the financial institutions greater than $30 million

            Three co-defendants charged in the scheme, Linda Mack, Tai Keyster, and Darryl Reese, are scheduled to go to trial on March 15, 2015.

The case is being investigated by the United States Postal Inspection Service, and is being prosecuted by Assistant U.S. Attorney Sarah E. Griswold.

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

   LAS VEGAS, Nev. – A local man who possessed over two kilos of methamphetamine in his car and another 4½ kilos of methamphetamine in a rented storage locker in Las Vegas, has been sentenced to 121 months in prison and five years of supervised release, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

            John Ortega, 25, of Las Vegas, was sentenced on Tuesday, Nov. 25, by Chief U.S. District Judge Gloria M. Navarro. Ortega pleaded guilty in August to one count of conspiracy to possess a controlled substance with intent to distribute methamphetamine and one count of money laundering.

            According to the court records, law enforcement investigators learned in early 2013 that Ortega was supplying kilo quantities of methamphetamine to co-defendant Keith Alcos, of Honolulu, Hawaii.  In August 2013, investigators obtained information that on Aug. 21, Alcos and two other co-defendants, James Richardson, Jr., and George Flores, were traveling from Honolulu to Las Vegas to obtain methamphetamine.  Investigators conducted surveillance of the defendants when they arrived in Las Vegas, and detected phone calls between the co-defendants and Ortega. On Aug. 25, they followed Ortega from his residence to a storage facility, where Ortega entered a storage unit and left with a black bag. Investigators conducted a traffic stop on Ortega’s vehicle and during a search of the vehicle, recovered approximately two kilos of methamphetamine from a compartment.  A later search of the storage unit resulted in the recovery of approximately 4½ kilos of liquid methamphetamine, $13,000, and a 9 mm handgun with an obliterated serial number. Investigators determined that Ortega rented the storage locker using a fake Mexican driver’s license bearing his photograph but the name of Jose Veltran Perez. 

Keith Alcos pleaded guilty to conspiracy to possess a controlled substance with intent to distribute methamphetamine, and is scheduled to be sentenced on Jan. 8, 2015. Richardson, Jr. and Flores are fugitives.

            This case was investigated by the FBI, IRS Criminal Investigation, DEA, and Las Vegas Metropolitan Police Department, and prosecuted by Assistant U.S. Attorney Amber M. Craig.

   LAS VEGAS, Nev. – Three local men have been charged with robbing a jewelry store in Las Vegas last week of approximately $700,000 worth of merchandise, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

            Theren Phillip Frazier, 27, Phillip Allerson Vaughn, 25, and Eric Jamar Goodall, 29, of North Las Vegas, are charged in a criminal complaint with one count of interference with commerce by robbery.  They made an initial court appearance yesterday before U.S. Magistrate Judge Cam Ferenbach.  Frazier and Vaughn were detained pending a preliminary hearing, and Goodall was temporarily detained pending a hearing on Monday.  If convicted, they face up to 20 years in prison and a $250,000 fine.

            “Our U.S. Attorney’s Office has made the prosecution of violent retail robbery and theft cases a priority,” said U.S. Attorney Bogden.  “We have been working with our local police departments and federal partners to identify these violent crime cases with interstate nexus for federal prosecutions.  The persons committing these crimes are typically repeat offenders who are unlawfully carrying and using firearms in furtherance of their crimes and are violating federal laws.”

            The complaint alleges that at about 2:00 p.m. on Nov. 10, Goodall, who was brandishing a semiautomatic pistol, and Vaughn entered a jewelry store located just off the Las Vegas Strip, and told victims to get down on the floor while they demanded jewelry and robbed the display cases of several hundred items of jewelry. Vaughn and Goodall loaded the jewelry into a backpack and left the store with about $700,000 worth of merchandise.  They were observed fleeing in a small white sedan driven by Frazier.  Las Vegas Metropolitan Police Department (LVMPD) officers followed the white car to a warehouse about a mile north, where Goodall and Vaughn jumped from the vehicle while it was still moving, and were apprehended.  Officers found the white vehicle badly damaged in a nearby casino valet area, and recovered from it a semiautomatic pistol and all of the jewelry from the robbery.  Frazier was arrested three days later by an FBI-led Criminal Apprehension Team task force.

            The case is being investigated by the FBI and LVMPD, and is being prosecuted by Assistant U.S. Attorneys Kathryn C. Newman and Daniel Cowhig.

The public is reminded that a criminal complaint contains only charges and is not evidence of guilt.  The defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

   LAS VEGAS, Nev. – U.S. Attorney Daniel G. Bogden announced today that the Nevada U.S. Attorney’s Office collected $10.9 million in Fiscal Year (FY) 2014 related to criminal, civil and asset forfeiture actions.  Of this amount, approximately $4.6 million was collected in criminal actions, $1.4 million was collected in civil actions, and $5 million was collected in criminal and civil forfeitures.
           
Additionally, the District of Nevada worked with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional $14 million in cases pursued jointly with these offices.  This additional shared amount was almost entirely collected in civil actions.  

“The collection of monetary penalties in federal litigation is a critical aspect of our work that frequently gets overlooked,” said U.S. Attorney Bogden.  “These collections are used to help crime victims and for a variety of other law enforcement purposes. Our FY 2014 collections far exceeded the total appropriated budget for our office for FY 2014.”  

An example of a recent case in which the U.S. Attorney’s Office for the District of Nevada collected a significant amount of money was a settlement of the Como Fire litigation.  That case involved a claim against Silver Reserve Corp. and Mining Contractor's Inc. for recoupment of fire suppression costs and rehabilitation of federal land.  The fire was caused by the negligent operation of an excavator that struck a power pole and ignited vegetation.  The contractor settled the claim and paid $250,000 to the United States.

Attorney General Eric Holder also announced today that the Justice Department collected $24.7 billion in civil and criminal actions in the fiscal year ending Sept. 30, 2014. The more than $24 billion in collections in FY 2014 represents nearly eight and a half times the appropriated $2.91 billion budget for the 94 U.S. Attorney’s offices and the main litigating divisions in that same period.

            “Every day, the Justice Department’s federal prosecutors and trial attorneys work hard to protect our citizens, to safeguard precious taxpayer resources, and to provide a valuable return on investment to the American people,” said Attorney General Holder.  “Their diligent efforts are enabling us to achieve justice and recoup losses in virtually every sector of the U.S. economy.  And this result shows the fruits of the Justice Department’s tireless work in enforcing federal laws; in protecting the American people from violent crime, national security threats, discrimination, exploitation, and abuse; and in holding financial institutions accountable for their roles in causing the 2008 financial crisis.”

The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims.  The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss.  While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.

The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws.  In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration and Department of Education.

   LAS VEGAS, Nev. – U.S. District Judge Jennifer A. Dorsey sentenced three defendants this morning for their involvement in a conspiracy to distribute the synthetic drugs known as “spice” and “bath salts,” announced U.S. Attorney Daniel G. Bogden, for the District of Nevada. 

Joshua Michael Riley, 32, of Henderson, Nev., was sentenced to 51 months in prison and three years of supervised release, Nicholas Collado, 32, of Houston, Texas, was sentenced to 37 months in prison and three years of supervised release, and Alexandra Haardt, 28, of Henderson, Nev., was sentenced to three years of probation with a condition of one year of home confinement. They pleaded guilty over the summer to one count of conspiracy to possess with intent to distribute and distribute a controlled substance and controlled substance analogue.  Judge Dorsey also entered final orders of forfeiture against all of the defendants requiring them to turn over in large part to the government approximately $802,000 in bank accounts, $371,000 in gold and silver bars and coins, $32,000 in money orders and checks, $14,700 in jewelry, a Cadillac vehicle, a condominium in Henderson, Nev., and two handguns and ammunition.

Two other defendants were also charged in the conspiracy.  Marco Alvarado pleaded guilty and was sentenced on Nov. 12 to 30 months in prison, and Jacob Fisher pleaded guilty and is scheduled for sentencing on Nov. 19.

“Spice” and “bath salts” are potent and dangerous substances that are being sold to an unwary public in convenience stores, head shops, gas stations and online,” said U.S. Attorney Bogden. “These synthetic drugs are powerful substances that when consumed have caused hallucinations and dangerous levels of overdose.  We will continue working diligently with our local, state and federal law enforcement partners to prosecute persons who callously and recklessly distribute them.”

According to the court records, Riley owned and operated JMR Enterprises in Las Vegas. The defendants ordered chemicals from China, and manufactured controlled substance analogues, such as spice and bath salts, at Riley’s large residence in Las Vegas. The defendants sold the controlled substances online over the website, thesupplyboys.com, using the brand names “Mad Pineapple,” Tiger Blood,” “Mad Max,” and “New Ivory Wave,” and distributed the orders via overnight delivery service on a regular basis to buyers as far east as Philadelphia, Pa. In July 2012, agents executed a federal search warrant at Riley’s home and recovered approximately 26 pounds of synthetic cannabinoids, also known as “spice,” three pounds of synthetic cathinones also known as “bath salts,” packaging materials, baking pans containing substances that were drying outside, and two firearms.  Law enforcement investigators also recovered approximately three additional pounds of bath salts, and 47 packages of “spice,” from the mails during the investigation.

“As these sentences make abundantly clear, the manufacture and sale of synthetic drugs is a serious crime,” said Michael Harris, Assistant Special Agent in Charge for Homeland Security Investigations Las Vegas. “These substances may have benign names like ‘spice’ and ‘bath salts,’ but they have been linked to serious health complications and even death. Even more troubling, is the fact that the distributors of these dangerous synthetic drugs are packaging and marketing them to appeal to young people.”

According to the Office of National Drug Control Policy, synthetic drugs are a rapidly emerging threat and there is an increasingly expanding array of synthetic drugs available.  Use of synthetic drugs is alarmingly high, especially among young people. The contents and effects of synthetic drugs are unpredictable due to a constantly changing variety of chemicals used in manufacturing processes devoid of quality controls and government regulatory oversight.  Health warnings have been issued by numerous public health authorities and poison control centers describing the adverse health effects associated with the use of synthetic drugs. The Administration has been working with federal, congressional, state, local, and non-governmental partners to put policies and legislation in place to combat this threat, and to educate people about the tremendous health risk posed by these substances.  For more information on the risks and dangers of synthetic drugs, go to http://www.whitehouse.gov/ondcp/ondcp-fact-sheets/synthetic-drugs-k2-spice-bath-salts.

The case was prosecuted by Assistant U.S. Attorney James E. Keller and investigated by ICE HSI and the U.S. Postal Inspection Service, with the assistance of the DEA.

    RENO, Nev. – A California man who brought a 14-year-old girl from Richmond, Calif., to the Reno area with the intent that she engage in sexual activity, was sentenced on Nov. 13, 2014, to 10 years in prison and lifetime supervised, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

            Nicholas Rider Wessel, 38, of Richmond, Calif., pleaded guilty in August to one count of transportation of a minor for illegal sexual activity and was sentenced by U.S. District Judge Miranda M. Du.  Judge Du denied Wessel’s request for release on bond pending a prison designation.

“If you prey on underage children on the Internet, you face federal prosecution,” said U.S. Attorney Bogden. “The penalties are stiff, and you will be marked as a sex offender for the rest of your life.”

            According to the court records, sometime in May 2014, Wessel began communicating with the 14-year-old girl on Facebook and by cell phone texts. During those conversations, Wessel arranged to pick the girl up in Modesto, Calif. and drive her to his home in Richmond.  Wessel knew that she was only 14 years old. On May 5, Wessel picked her up, along with another minor girl, and they drove to his home where he engaged in sexual intercourse with the 14-year-old. The following day, Wessel drove the girl to Reno, and they again engaged in sex at a hotel in Sparks, Nev. 

The investigation was conducted by the Sparks Police Department and the FBI. The case was prosecuted by Assistant U.S. Attorney Carla Higginbotham.

The case was brought as part of Project Safe Childhood (PSC), a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, PSC marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about PSC, please visit www.usdoj.gov/psc.  For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."

    RENO, Nev. – Michael Stickler, 54, of Reno, pleaded guilty today before U.S. District Judge Larry R. Hicks to one count of willful failure to collect or pay employment and Federal Insurance Contribution Act (FICA) taxes to the IRS, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

            According to Stickler’s plea agreement, he owned and operated a company in Reno called Faith Based Solutions from 1999 to 2009.  Stickler collected and withheld employment and FICA taxes from his employees’ wages, but failed to pay them over to the IRS.  Stickler pleaded guilty to failing to pay $17,389.25 in employment and FICA taxes for the fourth quarter of tax year 2007, but the plea agreement states that Stickler also admitted to willfully failing to pay over employment and FICA taxes to the IRS for other periods during the tax years 2006 through 2010, and that the total tax loss that can be used for sentencing purposes is $100,899.90. 

In a separately filed federal case, Stickler was convicted by a jury on March 24 of theft of public money.  The evidence presented to the jury in that case was that in 2007, Stickler’s company, Faith Based Solutions, received $500,000 in federal grant money to teach non-profit organizations how to apply for federal government grants.  Stickler drew down all of the grant funds in the first seven months of the grant period, and instead of distributing the money to sub-grantees, he put it in accounts that he controlled and used it to pay large salaries to himself and family members, to take elaborate vacations, and for other items that were not approved by the grant.

Sentencing in both cases will be on Feb. 9, 2015, at 9:00 a.m. before U.S. District Judge Miranda M. Du.

The cases were investigated by IRS Criminal Investigation and the U.S. Department of Health and Human Services Office of Inspector General.  They are being prosecuted by Assistant U.S. Attorney Carla B. Higginbotham.

    LAS VEGAS, Nev. – Denise J. Vick, 39, of Las Vegas, pleaded guilty on Tuesday, Nov. 4, 2014, before U.S. District Judge Andrew P. Gordon to four counts of filing false claims with the IRS, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

            “Tax refund fraud is a growing problem locally and nationally,” said U.S. Attorney Bogden.  “This type of tax fraudster cheats honest and law abiding tax payers by defrauding the government and stealing funds that are not rightfully theirs.  We will continue working with the IRS in Nevada to identify and prosecute these fraudsters.”

            According to the plea agreement, during 2010 and 2011, Vick created and caused to be filed false and fraudulent tax returns for herself and others for the tax years 2009 and 2010.  The returns reported wages, income and other information that was false, and caused the IRS to issue tax refunds to Vick and the others to which they were not entitled.  The refunds were issued on debit cards that Vick controlled.  In total, Vick fraudulently received $307,231 from the IRS as a result of the false claims that she submitted for herself and others.

Vick is scheduled to be sentenced on March 5, 2015, and faces up to five years prison and a fine of up to $250,000 on each count.                   

The case was investigated by IRS Criminal Investigation and prosecuted by Assistant U.S. Attorney Kathryn C. Newman.

     LAS VEGAS, Nev. – Assistant U.S. Attorney (AUSA) Sarah E. Griswold will lead the efforts of the U.S. Attorney’s Office for the District of  Nevada in connection with the Justice Department’s nationwide Election Day Program for the upcoming Nov. 4, 2014 general elections, announced U.S. Attorney Daniel G. Bogden.  AUSA Griswold has been appointed to serve as the District Election Officer (DEO) for the District of Nevada, and in that capacity is responsible for overseeing the District’s handling of complaints of election fraud and voting rights abuses in consultation with Justice Department Headquarters in Washington.  
                                                                                               
            United States Attorney Bogden said, “Every citizen must be able to vote without interference or discrimination and to have that vote counted without it being stolen because of fraud.  The Department of Justice will act promptly and aggressively to protect the integrity of the election process.”

            The Department of Justice has an important role in deterring election fraud and discrimination at the polls, and combating these violations whenever and wherever they occur.  The Department’s long-standing Election Day Program furthers these goals, and also seeks to insure public confidence in the integrity of the election process by providing local points of contact within the Department for the public to report possible election fraud and voting rights violations while the polls are open on Election Day. 

Federal law protects against such crimes as intimidating or bribing voters, buying and selling votes, impersonating voters, altering vote tallies, stuffing ballot boxes, and marking ballots for voters against their wishes or without their input.  It also contains special protections for the rights of voters and provides that they can vote free from acts that intimidate or harass them.  For example, actions of persons designed to interrupt or intimidate voters at polling places by questioning or challenging them, or by photographing or videotaping them, under the pretext that these are actions to uncover illegal voting may violate federal voting rights law.  Further, federal law protects the right of voters to mark their own ballot or to be assisted by a person of their choice.

            In order to respond to complaints of election fraud or voting rights abuses on Nov. 4, 2014, and to ensure that such complaints are directed to the appropriate authorities, U.S. Attorney Bogden stated that the U.S. Attorney’s Office, as part of the Nevada Election Integrity Task Force, will be working with the Nevada Secretary of State, the Nevada Attorney General, the Las Vegas Metropolitan Police Department, and the FBI to investigate complaints regarding questionable voter registration practices, potential voter fraud, and enforcement of laws regarding voter intimidation.  On Election Day, there will be command posts in Carson City and Las Vegas staffed by members of the Task Force.  Additionally, AUSA/DEO Griswold will be available while the polls are open on Nov. 4, 2014, to assist with the investigation of any complaints of election fraud or voting rights abuses, and to ensure that such complaints are directed to the appropriate authorities.  AUSA Carla Higginbotham will be available in Reno to assist with any complaints in the northern Nevada area.

Law enforcement officials, election workers and citizens can file complaints in a number of ways.

1) By Completing the Election Law Violation Form on the NV Secretary of State's website, http://nvsos.gov/index.aspx?page=256;

2) By calling the NV Secretary of State at (775) 684-5705; or

3) By calling the FBI in Las Vegas at (702) 385-1281 and asking for Special Agent Michael B. Elliott.

4) Complaints about possible violations of the federal voting rights laws can be made directly to the Civil Rights Division’s Voting Section in Washington by phone at 1-800-253-3931 or (202) 307-2767, by fax at (202) 307-3961, by email to [email protected] or by complaint form at ;

     LAS VEGAS, Nev. –The last of four defendants who participated in the high speed robberies of four Las Vegas convenience stores during April 2012, was sentenced to prison this week, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

            Michael Hall, 28, of Las Vegas, was sentenced by U.S. District Judge Jennifer A. Dorsey on Monday, Oct. 20, 2014, to 194 months in prison and five years of supervised release.  Hall pleaded guilty on Feb. 19, to four counts of interference with commerce by robbery and one count of brandishing a firearm in furtherance of a crime of violence.

            “We are working with our local police departments to prosecute federally deserving defendants who use guns to commit store robberies,” said U.S. Attorney Bogden. “Fortunately more victims were spared and this robbery spree was terminated because of excellent police work by the Las Vegas Metropolitan Police Department and the alert officer who observed the last robbery and chased down the defendants by car and on foot.”

             Hall was the getaway driver for each of the robberies that occurred between about 4:00 and 4:30 p.m. on April 6, 2012, causing law enforcement to dub the crimes the “30 minutes or less” series.  Hall’s co-defendants, Delon Hunter, 18, William Bonaparte, 24, and Erica Bowden-Payne, 26, all pleaded guilty and were sentenced to prison. In each robbery, Hunter pointed a handgun at Bonaparte, who was posing as a customer.  Hunter threatened to shoot Bonaparte if the store employee did not turn over money and other items. A Las Vegas Metropolitan Police Officer observed the last robbery in progress near Cheyenne Road and Buffalo Drive, and confronted the defendants as they were leaving the store. The defendants fled in the getaway vehicle driven by Hall, leading officers on a high speed chase before their vehicle came to a stop near Tenaya Way and Rainbow Boulevard. Three of the defendants fled on foot and were apprehended nearby. The fourth defendant, Bowden-Payne, remained in the vehicle and was apprehended there.        

The case was investigated by the FBI Safe Streets Task Force and Las Vegas Metropolitan Police Department and prosecuted by Assistant U.S. Attorney Cristina D. Silva. The case was screened through the Southern Nevada Project Safe Neighborhoods Task Force, a team of federal and local law enforcement officers and prosecutors who meet on a regular basis to discuss arrests involving guns and explosives. Project Safe Neighborhoods, also known as PSN, is a Department of Justice initiative and a nationwide commitment to reduce gun and gang crime in America.

     LAS VEGAS, Nev. – A Huntington Beach, Calif. man who defrauded the IRS of almost $800,000 in a false income tax refund scheme, was sentenced today to 21 months in prison and ordered to pay restitution to the government, announced U.S. Attorney Daniel G. Bogden for the District of Nevada and Special Agent in Charge John Collins of IRS Criminal Investigation for Nevada.

            Judas Godina, 39, was sentenced by U.S. District Judge Kent J. Dawson. Godina was indicted in July 2013 and pleaded guilty on July 15, 2014, to one count of conspiracy to defraud the IRS. He must report to federal prison by Jan. 16, 2015.

            “This type of tax crime harms every U.S. citizen and resident,” said U.S. Attorney Bogden. “We will aggressively work with the IRS to prosecute these cases, and will also recommend prison sentences in order to deter others from this type of fraud.”

“The substantial sentence of imprisonment and restitution handed down today on this case makes it clear that filing false claims for tax refunds is a serious crime,” said Special Agent in Charge Collins.  “IRS Criminal Investigation, with the assistance of our law enforcement partners and federal prosecutors, will aggressively pursue these violations of the law and protect the integrity of the tax system and honest taxpayers.”

According to the guilty plea agreement, from about January through December 2010, Godina conspired with Felix and Walter Guzman to defraud the IRS through a false income tax refund scheme. Godina recruited customers in Las Vegas into the tax return scheme by telling them that he could prepare their individual income tax returns and generate large refunds for them. Godina requested their identification information and tax returns from prior years, and then prepared the fraudulent tax returns using the information they provided, along with fraudulent W-2’s and Schedule E’s for business losses that he created. Godina transmitted or caused to be submitted the fraudulent forms to the IRS and monitored the status of the refunds.  When the customers received the refunds, Godina arranged to meet them and demanded payment of approximately one-half of the refund.  Godina also offered to pay a finder’s fee to customers who referred other paying customers to him and prepared fraudulent tax returns for customers recruited by co-defendants Felix and Walter Guzman.  Using this fraudulent scheme, Godina admitted that his conduct resulted in $791,666 in fraudulent refunds being issued by the IRS. The Guzman’s are currently fugitives and the charges against them are unresolved.

The case was investigated by IRS Criminal Investigation and prosecuted by Assistant U.S. Attorney Kathryn C. Newman.

     RENO, Nev. - A man who supervised and directed an illegal drug distribution operation in Reno from his home in southern California, was sentenced on Monday, Oct. 20, to 19½ years in federal prison and five years of supervised release, announced U.S. Attorney Daniel G. Bogden, for the District of Nevada.

Rosendo Salgado, 42, of Montclair, Calif., who was convicted by a jury on July 18 of one count of conspiracy to distribute methamphetamine, one count of money laundering conspiracy, and one count of illegal use of a communication facility, was sentenced by U.S. District Judge Larry R. Hicks.

“This defendant was no amateur drug trafficker and made a personal choice to engage in the trafficking of large amounts of almost pure methamphetamine over an extended period of time,” said U.S. Attorney Bogden.  “He showed his leadership of, experience and command of the conspiracy by using lower-ranking members to make hand-to-hand sales and use of coded language to track sales.”

According to court records and evidence admitted at trial, beginning in January 2013 pursuant to a court authorized wiretap, law enforcement officials intercepted telephone calls of Salgado discussing the methamphetamine distribution operation in the Reno area with co-conspirators.  The investigation continued, with Salgado observed meeting his co-conspirators in Reno.  On May 12, 2013, officials discovered from additional intercepted telephone calls of Salgado’s telephone, that a supply of methamphetamine from Salgado would be arriving that day in Reno via a vehicle courier, with the drugs secreted in the back door of the vehicle.  Investigators conducted surveillance outside the Reno home where the methamphetamine was delivered, and observed two co-conspirators removing a panel from the back passenger door of a white Toyota bearing California license plates.  That evening, investigators executed a federal search warrant at the home and recovered a firearm and two pounds of pure methamphetamine. Two days later, Salgado was arrested and charged by federal criminal complaint in California.

At sentencing, the court found that Salgado was an organizer, leader, manager or supervisor of the methamphetamine distribution conspiracy based upon the evidence, including intercepted calls, revealing Salgado’s instruction to his co-conspirators on a number of operational matters, including how to locate the concealed drugs that had been delivered to them, how much to sell the drugs for, where to deposit the drug proceeds, and how to use coded language to keep tallies of sales.  The co-conspirators who resided in Reno were prosecuted and convicted by the Washoe County District Attorney’s Office.

The case was prosecuted by Assistant U.S. Attorneys James E. Keller and Megan M. Rachow and investigated by the DEA, Northern Nevada High Intensity Drug Trafficking Area (HIDTA) Task Force, and Washoe County Sheriff’s Department.

     LAS VEGAS, Nev.  – Victor Bruce, M.D., 49, who operates Swan Lake Medical Center in Las Vegas, was sentenced this afternoon to 46 months in federal prison and three years of supervised release for writing prescriptions for oxycodone for persons he did not see or treat, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

            Bruce, who pleaded guilty in July to one count of conspiracy to distribute a controlled substance, was sentenced by U.S. District Judge Andrew P. Gordon. Bruce was permitted to self-report to federal prison by Jan. 16, 2015.

“Dr. Bruce repeatedly wrote prescriptions for highly addictive controlled substances for patients who did not need them, and for patients who did not appear at his medical practice or did not exist,” said U.S. Attorney Bogden.  “We continue to work with our local, state and federal law enforcement partners to put illegal pill-pusher doctors like Dr. Bruce in prison and out of business.”

            According to Bruce’s guilty plea agreement, he represents himself to be a pain management specialist and is the only physician working at the practice.  Beginning at a date unknown and continuing to around November 2013, Bruce and several co-conspirators, including Robert Wolfe, aka “old man,” Millicent Epino, Dylan DuBois, Jennifer Monge, and Jade Lepoma, conspired to distribute oxycodone. Wolfe would provide Bruce a list of names, and Bruce would write prescriptions for oxycodone for those names and give them to Wolfe.  Bruce also created “dummy” medical records for those persons, to make it appear as if a legitimate patient encounter had taken place.  On four occasions in June 2013, an undercover law enforcement officer purchased Bruce-written oxycodone prescriptions from Wolfe for $700 each. On each occasion, the undercover provided Wolfe or another co-conspirator with copies of Nevada driver’s licenses bearing the names of customers.  Usually within a day, Wolfe or another co-conspirator would then provide the undercover with written prescriptions for oxycodone.  Bruce knew he was writing prescriptions for controlled substances to customers he did not treat and who did not need the prescriptions.  None of the prescriptions were issued for a legitimate medical purpose or in the usual course of profession practice.

            According to the Nevada State Board of Medical Examiners, Bruce’s license to practice medicine in Nevada is still active; however, there is a pending board action against him related to the unlawful administering, dispensing or prescribing of controlled substances.

            Wolfe and several of the other co-conspirators were also charged in the drug conspiracy.

            This case was investigated by the Nevada High Intensity Drug Trafficking Area (Nevada HIDTA) Pharm-Net Task Force, including the DEA, IRS Criminal Investigation, Las Vegas Metropolitan Police Department, Henderson Police Department, North Las Vegas Police Department, and the Nevada Division of Investigations, and prosecuted by Assistant U.S. Attorneys Crane M. Pomerantz and Cristina D. Silva.

     LAS VEGAS, Nev.  – Mahesh Kuthuru, M.D., 46, of Henderson, Nev. was arraigned by a federal magistrate judge this afternoon and pleaded not guilty to felony drug distribution charges that he unlawfully sold highly addictive prescription painkillers to persons who did not have a medical necessity for them, announced U.S. Attorney Daniel G. Bogden for the District of Nevada. 
                                                  
            Kuthuru is charged in a criminal indictment with nine counts of unlawful distribution of controlled substances.  If convicted, he faces not more than 20 years in prison and a fine of up to $1 million.  U.S. Magistrate Judge Cam Ferenbach released Kuthuru on a personal recognizance bond pending trial.

            “Deaths from drug overdose, the majority from pharmaceuticals, have been rising steadily over the past two decades and have now become the leading cause of injury death in the United States,” said U.S. Attorney Bogden. “The number of overdose deaths combined with the costs to the workplace and healthcare and criminal justice systems, is cause for great alarm. We will continue to prosecute doctors who are contributing to this enormous problem.”

            According to the indictment, Kuthuru is a licensed physician in Nevada who represents himself to be a specialist in pain management.  Kuthuru operates Desert Pain Management which has occupied various locations on Charleston Boulevard in Las Vegas.  Beginning on a date unknown and continuing through at least 2013, Kuthuru allegedly sold prescriptions for large quantities of highly addictive frequently diverted prescription drugs, including oxycodone, morphine sulfate and methadone without medical necessity.   

            This case is being investigated by the Nevada High Intensity Drug Trafficking Area (Nevada HIDTA) Pharm-Net Task Force, including the DEA, IRS Criminal Investigation, Las Vegas Metropolitan Police Department, Henderson Police Department, North Las Vegas Police Department, and the Nevada Division of Investigations, and is being prosecuted by Assistant U.S. Attorney Crane M. Pomerantz.

An indictment contains only charges and is not evidence of guilt. The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

     LAS VEGAS, Nev. – Saul Candelorio Gastellum-Sanchez, a local illegal drug dealer, was sentenced today by U.S. District Judge Lloyd D. George to 15 years in prison and five years of supervised release, announced Daniel G. Bogden, United States Attorney for the District of Nevada.

            Gastellum-Sanchez, aka “Cervancio Perez-Zazueta,” aka “Bartolo Castillo,” aka “Vampiro,” 29, pleaded guilty in May to one count of conspiracy to distribute methamphetamine, one count of possession of methamphetamine with the intent to distribute, one count of possession of a firearm during and in relation to a drug trafficking crime, unlawful re-entry of a deported alien, and conspiracy to launder monetary instruments.

            “The defendant was a prolific drug trafficker who was distributing large quantities of methamphetamine and had firearms at hand,” said U.S. Attorney Bogden. “He was a serious threat to public safety and a lengthy sentence of imprisonment was warranted.”

            According to Gastellum-Sanchez’ plea agreement, from about June 1, 2012, to June 20, 2013, Gastellum-Sanchez conspired with six co-defendants to distribute 464 grams of methamphetamine to an undercover officer.  On May 20, 2013, Gastellum-Sanchez purchased an ATV for $11,000 in cash, which were proceeds from the sale of methamphetamine. 

On June19, 2013, a federal search warrant was executed at Gastellum-Sanchez’ residence in Las Vegas, and law enforcement agents recovered over two kilograms of methamphetamine, an AK-47 assault rifle and two semi-automatic handguns.  At the time of the crime, Gastellum-Sanchez was residing unlawfully in the United States and had been previously deported in January 2008.

Four of the co-defendants pleaded guilty and were sentenced to prison, one is a fugitive, and one is pending trial.

           This case was investigated by the DEA, Homeland Security Investigations, IRS Criminal Investigation, and the North Las Vegas Police Department, and prosecuted by Assistant U.S. Attorney Amber M. Craig.

     RENO, Nev. – John Thomas Abrams, 47, aka Buck, aka David George Garnett, aka John McDonald, aka David Blackwell, appeared before a federal magistrate judge today and pleaded not guilty to charges that he kidnapped a 15-year-old boy and girl in California and transported them to Reno with the intent that the girl engage in sexual activity, announced Daniel G. Bogden, United States Attorney for the District of Nevada.
           
            Abrams is charged in a criminal indictment with two counts of kidnapping and one count of transportation of a minor for illegal sexual activity.  Abrams was ordered detained pending trial, which was set for Dec. 1, 2014.  If convicted, Abrams faces a minimum of 20 years in prison on the kidnapping charges, a minimum of 10 years in prison on the transportation charge, as well as fines of up to $250,000 on each count.

            According to the allegations contained in the indictment, between about July 12 and July 22, 2012, Abrams kidnapped the girl and the boy in the Sacramento, Calif. area, and held them for ransom, reward, and otherwise. Abrams then transported them to Reno, Nev. with the intent that the girl engage in illegal sexual activity.

            “Investigating persons who prey on minors, elderly, and other vulnerable victims, is a top priority of the Justice Department and U.S. Attorney’s Office in Nevada,” said U.S. Attorney Bogden.  “We have dedicated more resources than ever to catching and prosecuting these predators, and are working with local, state and federal partners to make sure they face the criminal justice system.”

The investigation is being conducted by the FBI and the Sacramento Police Department. The case is being prosecuted by Assistant United States Attorney Carla Higginbotham.

The case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal
Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals, federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project
Safe Childhood, please visit www.usdoj.gov/psc.  For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."

The public is reminded that an indictment contains only charges and is not evidence of guilt.  The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

      LAS VEGAS, Nev. – Two men have been charged with conspiracy and fraud for engaging in a scheme to misappropriate $34 million from two Florida-based hedge funds during 2008 to 2010, announced Daniel G. Bogden, United States Attorney for the District of Nevada.

            Robert Buckhannon, 53, of Las Vegas, and Terry Rawstern, 66, of Aberdeen, S.D., are charged in a criminal indictment with one count of conspiracy to commit wire fraud and one count of wire fraud.  Buckhannon, who was arrested by FBI agents yesterday in Henderson, Nev., pleaded not guilty this afternoon at an arraignment before U.S. Magistrate Judge George Foley, and was released on a personal recognizance bond pending trial.  Rawstern’s arraignment is scheduled for tomorrow, Oct. 2 at 3:00 p.m.  If convicted, the defendants face up to 30 years in prison on the conspiracy charge, up to 20 years in prison on the wire fraud charge, and fines of up to $1 million on each count.

            “We have been working with our federal, state and local partners to investigate and prosecute persons who commit significant financial crimes,” said U.S. Attorney Bogden.  “Often these cases take considerable time and resources to investigate and litigate, but the American people deserve to know that we are working diligently to catch the perpetrators.”

            According to the indictment, from April 2008 through April 2010, Buckhannon and Rawstern and co-conspirators were managing members of two Bradenton, Florida-based hedge funds, Arcanum Equity Fund, LLC and Vestium Equity Fund, LLC. The defendants allegedly engaged in a fraudulent scheme to misappropriate $34 million they raised from investors by misrepresenting how they would use the investors’ funds and misrepresenting that there were safeguards over the investors’ money, such as an independent trustee and independent fund administrator.  The defendants then looted and bankrupted the hedge funds by taking payments on false and fictitious profits and taking improper and undisclosed loans.  The indictment states that as a result of the defendants’ conduct, investors lost approximately $13.1 million.  In April 2010, the hedge funds voluntarily filed for Chapter 7 bankruptcy and are now under the control of court-appointed trustees.

The case is being investigated by the FBI, and prosecuted by Assistant U.S. Attorney Kathryn C. Newman.

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

      LAS VEGAS, Nev. – Daniel G. Bogden, United States Attorney for Nevada, in conjunction with the U.S. Department of Justice Office of Community Oriented Policing Services (COPS), is pleased to announce that on Monday, Sept. 29, the U.S. Department of Justice awarded three grants totaling $2,125,000 to the North Las Vegas Police Department, the City of Elko, and the Elko County Sheriff’s Office for the hiring of 17 law enforcement officers.

The Justice Department announced the funding awards to the three agencies under the COPS Hiring Program, which provides funds directly to law enforcement agencies to hire or re-hire career law enforcement officers, and to increase their community policing capacity and crime prevention efforts.  The program provides salaries and benefits for officer and deputy hires for three years. Grantees for the 2014 hiring program were selected based on their fiscal needs, local crime rates, and community policing plans.

“The COPS Office is pleased to assist local law enforcement agencies throughout the country in addressing their most critical public safety issues,” said Ronald L. Davis, Director of the COPS Office. “Funding from this year’s program will allow many cities and counties to apply new sworn personnel to issues related to violent crime, property crime, and school safety.”

Nearly $124 million in grants was awarded nationally under the hiring program, including the $2.1 million for the District of Nevada. Of that, $1.6 million was awarded to the North Las Vegas Police Department for the hiring of 13 officers, $375,000 was awarded to the Elko County Sheriff’s Office for the hiring of three officers, and $125,000 was awarded to the City of Elko for the hiring of one officer.

“The Department of Justice continues to support the efforts of law enforcement in Nevada,” said U.S. Attorney Bogden.  “This program is specifically designed to advance public safety through community policing, including the hiring of school police officers or school resource officers.  Bullying, stalking and other interpersonal crimes affect our children at an alarming rate, making these positions more important than ever.”

The COPS Office is a federal agency responsible for advancing community policing nationwide. Since 1995, COPS has awarded over $14 billion to advance community policing, including grants awarded to more than 13,000 state, local, and tribal law enforcement agencies to fund the hiring and redeployment of approximately 125,000 officers and provide a variety of knowledge resource products including publications, training, and technical assistance.

For the entire list of grantees and additional information about the 2014 COPS Hiring Program, visit the COPS website at www.cops.usdoj.gov.

       LAS VEGAS, Nev. – Las Vegas urologist, Michael Stanley Kaplan, 59, was convicted by a federal jury today of conspiracy to commit adulteration for re-using single use needle guides during prostate procedures, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

“Dr. Kaplan made a decision to re-use needle guides in a manner that caused them to be adulterated for the purpose of enriching himself,” said U.S. Attorney Bogden. “He also concealed from his patients that they were undergoing procedures with re-used needle guides.  Such conduct is a felony when performed with the intent to defraud or mislead. This case underscores our commitment to holding accountable those medical professionals who would endanger patients for their own personal profit.”

At the time of the offense, Dr. Kaplan operated Green Valley Urology. According to the evidence presented at trial, Kaplan re-used single-use plastic needle guides during prostate procedures, causing a significant health risk to his patients. The packaging on each needle guide clearly warned that they should not be used more than once, but Dr. Kaplan instructed his staff and permitted his staff to re-use them three to five times prior to disposal.  Between about Dec. 15, 2010, and March 11, 2011, Dr. Kaplan performed approximately 120 procedures requiring a needle guide but used less than 10 guides during that period. 

Dr. Kaplan was acquitted of making false representations to Food and Drug Administration (FDA) investigators regarding the duration of his re-use of the needle guides.

            Dr. Kaplan is released on a personal recognizance bond and is scheduled to be sentenced on Jan. 30, 2015.  He faces up to five years in prison and a fine of up to $250,000.

The case was investigated by the FDA Office of Criminal Investigations and prosecuted by Assistant U.S. Attorney Crane M. Pomerantz and Special Assistant U.S. Attorney Peter J. Leininger.

       LAS VEGAS, Nev. - A Henderson, Nev. man was sentenced today to two years in prison for aiming a laser pointer at a Las Vegas Metropolitan Police Department (LVMPD) helicopter on six occasions earlier this year, announced Daniel G. Bogden, United States Attorney for the District of Nevada. 

            James David Zipf, 30, pleaded guilty in June to one count of aiming a laser pointer at an aircraft, and was sentenced by U.S. District Judge Miranda M. Du.  Zipf was permitted to self-report to federal prison by December 30, and must also serve three years of supervised release and undergo mental health and substance abuse treatment.

Zipf admitted that just after midnight on Jan. 30, 2014, he aimed a blue laser four times at the LVMPD helicopter from the second story window of the Green Valley neighborhood house where he lived.  Zipf also admitted that on Feb. 3, 2014, at about 9:00 p.m., he pointed the blue laser light two times at a LVMPD helicopter causing one of the flight officers to experience a severe headache. Zipf was convicted in 2011 in Phoenix, Ariz. of pointing a similar blue laser at a police helicopter there. 

            “In 2012, it became a federal felony offense to knowingly target an aircraft with a laser,” said U.S. Attorney Bogden. “This activity is extremely dangerous, and can disorient and temporarily blind a pilot.  If you have information about a lasing incident or see someone pointing a laser at an aircraft, call your local FBI field office or dial 911.”

  Since the FBI and the Federal Aviation Administration (FAA) began tracking laser strikes in 2005, statistics reflect a more than 1,100 percent increase in the deliberate targeting of aircraft by people with handheld lasers.  In 2013, there were 3,960 laser illumination incidents reported by pilots to the FAA. This is an average of 10.8 incidents every night.

The case was investigated by the FBI and LVMPD, and prosecuted by Assistant U.S. Attorney Roger Yang.   

        LAS VEGAS, Nev. – Clark County Family Court Judge Steven E. Jones and four co-defendants pleaded guilty today to conspiracy charges for defrauding over 22 people of millions in an investment fraud scheme involving bogus water rights and real estate transactions, announced U.S. Attorney Daniel G. Bogden for the District of Nevada and Laura Bucheit, Special Agent in Charge of the FBI for Nevada. As part of his plea agreement with the government, Jones agreed to step down from the bench and surrender his law license to the State Bar of Nevada.

Jones, 56, Thomas A. Cecrle, Jr., 57, and Terry J. Wolfe, 59, of Henderson, Nev., and Mark L. Hansen, 56, of Corvallis, Ore., pleaded guilty before U.S. District Judge Jennifer A. Dorsey to one count of conspiracy to commit wire fraud.  Also in connection with the same fraud scheme, Constance C. Fenton, 70, of Gig Harbor, Wash., pleaded guilty to one count of conspiracy to commit money laundering.  They each face up to 20 years in prison, $250,000 in fines, and mandatory restitution, and are scheduled to be sentenced on Jan. 26, 2015.  A sixth defendant charged in the scheme, Ashlee M. Martin, 30, of Las Vegas, Nev., pleaded guilty on Aug. 11 to conspiracy to commit money laundering, and is scheduled to be sentenced in August 2015.   

“This prosecution was the result of a long, thorough, and resource-intensive investigation and should serve as a vivid reminder that public officials who use their offices as a means to commit a crime of whatever nature will be pursued vigorously and prosecuted to the utmost rigor of the law,” said U.S. Attorney Bogden. “Defendant Jones knowingly used his office to lull victims into a false sense of security about investments he knew were scams.  No one is above the law, especially a person holding the office of judge.” 

"These guilty pleas serve as evidence to the public that the FBI, working with our law enforcement partners and the U.S. Attorney’s Office, will continue to ensure that no one is above the law, and when public corruption is identified, it will be aggressively investigated and prosecuted,” said Special Agent in Charge Bucheit.

 According to the plea memoranda, defendants lured victims into a fraud scheme by falsely telling them that Cecrle worked as a contractor for the U.S. Department of Homeland Security, purchasing and selling water rights worth millions of dollars as part of a secret government program.  The co-conspirators then solicited money by falsely claiming that Cecrle needed short-term cash loans to complete his phantom water deals, loans he promised to repay in short order along with a very large return.  Cecrle and his co-conspirators concocted a similar story involving a land deal on the Las Vegas Strip where Cecrle needed short-term loans to supposedly close a deal with Sir Richard Branson.  In truth, however, Cecrle held no position with the federal government and there were no land or water rights deals.

Using his office as an elected state court judge, defendant Jones knowingly vouched for Cecrle and the legitimacy of the deals to potential investors when he knew the deals were, in fact, scams.  According to the plea memorandum, Jones continued to further the conspiracy by receiving money from a victim in the parking lot of the Family  Division Courthouse, meeting with at least one potential investor in his chambers and elsewhere in the courthouse to discuss the investment,  obtaining an “Own Recognizance” bond to release Cecrle from custody after he was arrested for bad checks he had passed to a victim, and opening and maintaining a joint checking account with Cecrle, through which flowed over $260,000 in illegal proceeds.  During the entire conspiracy, which lasted from about September 2002 to October 2012, the defendants defrauded at least 22 victims of more than $2.6 million, money they quickly converted to their own use.

The case was investigated by the FBI and prosecuted by First Assistant U.S. Attorney Steven W. Myhre and Assistant U.S. Attorney Daniel R. Schiess of the U.S. Attorney’s Office for the District of Nevada.

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

        LAS VEGAS, Nev. – Former Las Vegas physician Vinay Bararia, 44, was sentenced today to 44 months in prison and three years of supervised release for unlawfully selling hydrocodone and oxycodone to an undercover DEA agent in a hospital parking lot, announced Daniel G. Bogden, United States Attorney for the District of Nevada. 

            “Stopping the unlawful distribution of prescription painkillers has been a top priority for our office,” said U.S. Attorney Bogden.  “The days of persons being able to easily acquire these dangerous drugs from corrupt doctors and pharmacists are coming to an end.”       

The sentence was imposed by U.S. District Judge Jennifer Dorsey, who also ordered Bararia to forfeit approximately $50,000 in cash and the 2007 Jaguar vehicle he used to distribute the drugs, and increased his sentence for abusing his position of trust as a doctor.  

Judge Dorsey denied Bararia’s request for a reduced sentence based on arguments by his attorneys that he had diminished mental capacity, extenuating family circumstances, or that he acted aberrantly when he committed the crime.

Bararia was originally charged in March 2012, and pleaded guilty on Dec. 18, 2013, to one count of distribution of a controlled substance.  According to the guilty plea agreement, on July 20, 2011, Bararia unlawfully sold 500 hydrocodone pills for $1125 to a DEA undercover agent in the parking lot of Centennial Hills Hospital.  Bararia’s sentence included other relevant conduct, including the unlawful distribution of approximately 3,600 oxycodone pills between July 28 and Nov. 8, 2011, and the possession of 2,038 oxycodone pills that were recovered from his vehicle on March 1, 2012, when he was arrested in the parking lot of the hospital.  

Bararia has been in federal custody since November 2012, as a result of repeated violations of his conditions of release.  He surrendered his license to practice medicine in Nevada in March 2013.

            This case was investigated by the DEA and prosecuted by Assistant U.S. Attorneys Susan Cushman and Robert Knief.

        LAS VEGAS, Nev. – Anthony M. Cirulli, a former employee of a Las Vegas casino company, pleaded guilty today before U.S. District Judge Gloria M. Navarro to one count of tax evasion, announced U.S. Attorney Daniel G. Bogden for the District of Nevada. 

            “Individuals are required to pay federal taxes on income, even if acquired unethically,” said U.S. Attorney Bogden.  “If you do not pay the taxes, you risk an investigation by the IRS and criminal prosecution.” 

According to the plea agreement, from about 2005 to 2008, Cirulli was employed as a production manager in the corporate advertising department of the casino company.  Part of his job involved reviewing bids for printing contracts and deciding which printing companies would be awarded the contracts.  For the 2007 tax year, Cirulli willfully filed a false individual income tax return, which omitted and failed to report income that he received during his employment at the company. Cirulli hid the unreported income in two different nominee bank accounts which conducted no actual business activity.  The potential tax loss to the U.S.Treasury as a result of Cirulli’s conduct is approximately $350,000.

Cirulli is scheduled to be sentenced on Dec. 18, and faces up to five years prison, three years of supervised release, and a fine of up to $250,000.            

The case was investigated by IRS Criminal Investigation and prosecuted by Trial Attorney Christopher Maietta of the Justice Department’s Tax Division and Assistant U.S. Attorney Nicholas Dickinson.

         LAS VEGAS, Nev. – A local lawyer who served as U.S. Attorney for Nevada from 1975 to 1977, pleaded guilty today to failing to file federal individual and corporate income tax returns from 2006 to 2010, and agreed to pay restitution to the IRS of approximately $290,000, announced Daniel G. Bogden, United States Attorney for the District of Nevada. 

            “Regardless of one’s occupation, job title or position, everyone is responsible for filing and paying taxes on all of their income,” said United States Attorney Bogden.  “It is important that American taxpayers understand and feel confident that everyone is playing by the same rules in filing and paying their taxes.”

Lawrence J. Semenza, II, pleaded guilty before U.S. District Judge James C. Mahan to three misdemeanor counts of willful failure to file a tax return. According to the guilty plea agreement, Semenza operated his law practice in Las Vegas as a subchapter C personal service corporation. For the years 2006 through 2010, Semenza individually had taxable income of approximately $655,000, and the corporation had taxable income of approximately $345,000, but Semenza failed to file individual or corporate income tax returns for those years, and failed to pay the tax due and owing to the IRS, totaling about $290,000.

            Semenza is scheduled to be sentenced on Dec. 3, 2014.  The maximum penalty for each count is one year in prison and a fine of not more than $100,000.

The case is being investigated by IRS Criminal Investigation and prosecuted by Assistant U.S. Attorneys Eric Johnson and Nicholas D. Dickinson.

         LAS VEGAS, Nev. – A local lawyer who served as U.S. Attorney for Nevada from 1975 to 1977, pleaded guilty today to failing to file federal individual and corporate income tax returns from 2006 to 2010, and agreed to pay restitution to the IRS of approximately $290,000, announced Daniel G. Bogden, United States Attorney for the District of Nevada. 

            “Regardless of one’s occupation, job title or position, everyone is responsible for filing and paying taxes on all of their income,” said United States Attorney Bogden.  “It is important that American taxpayers understand and feel confident that everyone is playing by the same rules in filing and paying their taxes.”

Lawrence J. Semenza, II, pleaded guilty before U.S. District Judge James C. Mahan to three misdemeanor counts of willful failure to file a tax return. According to the guilty plea agreement, Semenza operated his law practice in Las Vegas as a subchapter C personal service corporation. For the years 2006 through 2010, Semenza individually had taxable income of approximately $655,000, and the corporation had taxable income of approximately $345,000, but Semenza failed to file individual or corporate income tax returns for those years, and failed to pay the tax due and owing to the IRS, totaling about $290,000.

            Semenza is scheduled to be sentenced on Dec. 3, 2014.  The maximum penalty for each count is one year in prison and a fine of not more than $100,000.

The case is being investigated by IRS Criminal Investigation and prosecuted by Assistant U.S. Attorneys Eric Johnson and Nicholas D. Dickinson.

         RENO, Nev. – United States Attorney Daniel G. Bogden this week welcomed members of the Nevada Native American community network to the 18th Annual Native American Conference being held Aug. 25 through Aug. 27, 2014, at the Grand Sierra Resort in Reno.  Attendees include members of tribal government, tribal law enforcement, social workers, court personnel, and others.

“I take great pride in our work with Nevada Native American Tribes and in handling Indian Country matters,” said U.S. Attorney Bogden. “Our annual conference is one method we use to strengthen collaboration with our tribal partners.  This year’s conference, entitled “Working Together for Hope, Healing and Justice,” is intended to assist us in protecting our most precious resource – our children.”    

U.S. Attorney Bogden is assisted at the conference by his Criminal Chief Eric Johnson, Reno Branch Chief Sue Fahami, Assistant U.S. Attorney and tribal liaison Shannon Bryant, Assistant U.S. Attorney Carla Higginbotham, his victim witness staff, and law enforcement representatives from the FBI and Bureau of Indian Affairs.  Funding and additional assistance for the conference was provided by the U.S. Department of Justice Office for Victims of Crime. The agenda includes classes and speakers on a wide variety of subjects such as crisis response, bullying, child and youth sex abuse, interviewing child victims, child trafficking, Indian Country jurisdiction, and case studies in Indian Country. 

Nevada is home to 26 federally recognized Native American Tribes located on 31 reservations and colonies. For more information on the U.S. Attorney’s work with Nevada Indian tribes, visit http://www.justice.gov/usao/nv/programs_tribal.html.          

The Department of Justice released yesterday its second report to Congress entitled Indian Country Investigations and Prosecutions, which provides a range of enforcement statistics required under the Tribal Law and Order Act of 2010, as well as information about the progress of the Attorney General’s initiatives to reduce violent crime and strengthen tribal justice systems. For further information, see http://www.justice.gov/opa/pr/2014/August/14-ag-902.html

         LAS VEGAS, Nev.  – Assistant United States Attorney (AUSA) Kimberly Frayn of the U.S. Attorney’s Office for the District of Nevada and Special Agent Michael P. Adams of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) in Las Vegas, received awards today in Phoenix, Ariz., from the International Association of Financial Crimes Investigators for the investigation and prosecution of members of a highly sophisticated international cybercrime organization known as “Carder.su,” announced Daniel G. Bogden, United States Attorney for the District of Nevada and Michael Harris, Assistant Special Agent in Charge for HSI Las Vegas. 

            AUSA Frayn received the William D. Neumann Prosecutor of the Year Award for her efforts as the primary prosecutor in the Nevada case, known as, “Operation Open Market.”  The Award acknowledges prosecutors who have shown exceptional diligence, cooperation and tenacity, and who have made significant contributions to financial fraud prevention.

Special Agent Adams received the Cyber Investigations Contributor of the Year award for his efforts as the case agent in Operation Open Market. The Award acknowledges Agent Adams’ cyber investigative skills which significantly aided in the apprehension, arrest and prosecution of the suspects. 

“It pleases me that AUSA Frayn and Special Agent Adams have been recognized by an international association for their superior work and efforts in fighting financial fraud,” said U.S. Attorney Bogden. “The investigation and prosecution of a cybercrime case requires special skills and expertise, as well as diligence and tenaciousness of character. AUSA Frayn and Special Agent Adams have all of those qualities combined, which has led to successful court cases and convictions.”   

“These awards are richly deserved and reflect the extraordinary amount of work both the agent and prosecutor invested in this complex and far-reaching case,” said Assistant Special Agent in Charge Michael Harris. “There’s no question their collaborative efforts are in large measure responsible for the successful outcome of this investigation. For prosecutors and investigators, seeing career criminals like the defendants in this case brought to justice is its own reward, but having those efforts recognized in such a public way makes the outcome even more gratifying.”

Special Agent Adams assumed the identity as a member of the Carder.su organization when it was in its infancy.  The investigation determined that its members or “carders,” were involved in large scale trafficking of compromised credit card account data and counterfeit identifications and credit cards, as well as money laundering, narcotics trafficking, and various types of computer crime. The organization operated an internet web portal called a forum, where members could purchase the illicitly obtained data and share knowledge of various fraud schemes. A second forum was also created to vet incoming new members.  The forums were generally hosted within the former Soviet Union and the upper echelon of the organization resides within the former Soviet Union. It was estimated that in July 2011, there were over 5,500 members of the organization. Members of the organization had different roles, including moderators who directed other members in carrying out activities; reviewers who examined and tested products, services, and contraband; vendors who advertised and sold products, services and contraband; and members. Members were required to successfully complete a number of security features designed to protect the organization from infiltration by law enforcement or members of rival criminal organizations. 

Operation Open Market resulted in federal criminal charges against 56 individuals. The defendants are charged with conspiracy to participate in a racketeer influenced corrupt organization, trafficking in compromised credit card account data and counterfeit identifications, money laundering, narcotics trafficking, and computer crimes. To date, 25 individuals have been convicted, and the rest are either fugitives or are pending trial in Las Vegas. 

The International Association of Financial Crimes Investigators (IAFCI) is a non-profit organization with over 4,000 members whose mission is to identify and prevent financial crimes utilizing new technologies and investigative techniques.  The Association has 40 Chapters worldwide.

WASHINGTON – A northern California man who served as an information and document vendor in the identity theft and credit card fraud ring known as “Carder.su” was sentenced yesterday to serve 100 months in federal prison.  He was further ordered to pay approximately $50.5 million in restitution.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Daniel G. Bogden of the District of Nevada and Assistant Special Agent in Charge Michael Harris of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE HSI) in Las Vegas made the announcement.  U.S. District Judge Andrew P. Gordon of the District of Nevada imposed the sentence.

“Carder.su is a criminal organization, and we used the same mob-busting laws and investigative techniques we’ve used with other organized crime networks to dismantle the fraud ring,” said Assistant Attorney General Caldwell.  “The new face of organized crime is largely cyber-based, and this case demonstrates the department’s ability to pursue members of these organizations wherever we find them.” 

            “The structure of the Carder.su organization was sophisticated and designed to prevent attack by rival organizations and to avoid detection by law enforcement,” said U.S. Attorney Bogden.  “Its members had defined roles and were responsible for the theft of over $50 million.  We are working diligently with our law enforcement partners to ensure that the people who commit these high-tech crimes are put out of business.”

“As this multi-year sentence makes clear, individuals like this defendant who traffic in stolen identities and compromised credit card information should expect to face the full weight of the law,” said HSI Assistant Special Agent in Charge Harris. “This type of fraud has reached epidemic proportions and the economic fallout from these crimes affects us all.  HSI will continue to work closely with its law enforcement partners to see that those involved are brought to justice.”

Makyl Haggerty, aka “Wave” and “G5,” 24, of Oakland, Calif., admitted in his plea agreement that in December 2009, he became associated with the Carder.su organization, a criminal enterprise whose members trafficked in compromised credit card account data and counterfeit identifications, and committed money laundering, narcotics trafficking, and various types of computer crime.  Specifically, Haggerty operated as a vendor on the organization’s websites using the “Wave” and “G5” nicknames, and sold approximately 1,000 counterfeit identification documents and counterfeit credit cards to other Carder.su members.  Haggerty manufactured and sold counterfeit driver’s licenses for at least 15 states and British Columbia.  

Fifty-six individuals were charged in four separate indictments in Operation Open Market, which targeted the Carder.su organization.  To date, 25 individuals have been convicted and the rest are either fugitives or are pending trial.  Haggerty pleaded guilty in February to one count of participation in a racketeer influenced corrupt organization.   

The cases were investigated by HSI and the U.S. Secret Service, and are being prosecuted by Trial Attorney Jonathan Ophardt of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorneys Kimberly M. Frayn and Andrew W. Duncan of the District of Nevada.

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

          LAS VEGAS, Nev. – U.S. Attorney Daniel G. Bogden and other federal law enforcement representatives last week held meetings with leaders and representatives of 21 northern Nevada Indian tribes, and conducted tours of their reservations, announced United States Attorney Daniel G. Bogden.

“We strive each year to improve communication and coordination with our tribal partners,” said U.S. Attorney Bogden.  “There is no quick fix to the public safety problems the tribes face, but my office, as well as the FBI, Bureau of Indian Affairs, DEA and other federal agencies, are committed to fighting crime and promoting justice on Nevada Indian lands.”

The four-day trip, which U.S. Attorney Bogden has been conducting on an annual basis for the last several years, is part of a national effort to establish regular and meaningful consultation and collaboration with tribal officials.  U.S. Attorney Bogden was joined on this year’s trip by his Criminal Chief, Eric Johnson, and Reno Branch Chief, Sue Fahami, as well as the Assistant Special Agent in Charge of the Bureau of Indian Affairs (BIA) for District III, Selanhongva McDonald, BIA Special Agent Molly Hernandez, BIA Supervisory Special Agent Clifford C. Serawop, DEA Resident Agent in Charge Jerry Miller, and FBI Special Agents Brian Keeney, Michael Spitzer, and David Elkington.

            The tribal consultation meetings were conducted from Monday, July 28 through Thursday, July 31, 2014, and included discussions about tribal issues, investigations, victim advocacy, training, outreach, public safety, and violence against women.

The group visited the Washoe Tribe of Nevada and California; the Carson Colony, Dresslerville, and Stewart Community Councils; Yerington, Walker River and Summit Lake Paiute Tribes; Reno-Sparks Indian Colony; Pyramid Lake Paiute Tribe; Fallon Paiute Tribe; Duckwater Sho-Pai Tribe; Ely Shoshone Tribe; Wells Band Council; Duck Valley Sho-Pai Tribe; South Fork Band Council; Elko Band Council; Elko Te-Moak Tribe; Battle Mountain Band Council; Winnemucca Colony Council; Fort McDermitt Paiute Shoshone Tribe; and Lovelock Paiute Tribe. The group plans to visit the remaining Nevada tribes and reservations later this year. 

In addition to the tribal lands consultation tour each year, the Nevada U.S. Attorney’s Office holds a state-wide Native American Conference.  This year’s conference, entitled “Working Together for Hope, Healing and Justice” is the 18th State-Wide Native American Conference and will be held Aug. 25 through Aug. 27, 2014, at the Grand Sierra Resort in Reno, Nev. The conference is open to tribal chairs, administrators and tribal members, social and health care workers, law enforcement, court personnel, and others who might benefit learning from a number of topics and issues impacting the tribes.

Nevada is home to 26 federally recognized Native American Tribes located on 31 reservations and colonies. For more information on the U.S. Attorney’s work with Nevada Indian tribes, visit http://www.justice.gov/usao/nv/programs_tribal.html.