Eastern District of New York
Press releases recorded for this federal judicial district.
Defendant Sentenced in Brooklyn Federal Court to 28 Years in Prison for Drug-Related MurderRead the Press Release
Earlier today, in federal court in Brooklyn, Christian O. Dalmau was sentenced by United States District Judge Pamela K. Chen to 28 years in prison for murder in furtherance of a drug trafficking conspiracy and possessing a firearm in connection with that drug trafficking conspiracy. Dalmau pleaded guilty to those charges in September 2020.
Breon Peace, United States Attorney for the Eastern District of New York, and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the sentence.
“Dalmau callously murdered the victim over an unpaid drug debt, but today, Dalmau begins to answer for a different debt – the one he owes to society for decades to come for committing these crimes,” stated United States Attorney Peace. “Today’s sentence underscores the commitment of this Office to protecting our communities from violence and dangerous drugs.”
Mr. Peace thanked the Buffalo Police Department for its assistance in this case.
From at least 2011 until Dalmau’s arrest in 2015, the defendant was the leader of a large-scale cocaine distribution network operating throughout the northeast, but primarily in New York City, Buffalo, New York, Pennsylvania, Massachusetts and Puerto Rico. One of the individuals Dalmau supplied with quantities of cocaine was Dustin Ortiz-Maldonado. According to public filings and statements made during his guilty plea, on January 5, 2014, Dalmau fatally shot Ortiz-Maldonado four times in Buffalo over a dispute involving an unpaid drug debt.
Assistant United States Attorney Lauren Howard Elbert is in charge of the prosecution.
The Defendant:
CHRISTIAN O. DALMAU
Age: 35
Bronx, New YorkE.D.N.Y. Docket No. 18-CR-250 (PKC)
Justice Department Awards $481,285 Grant to Support Crime-Fighting Efforts in Suffolk and Nassau CountiesRead the Press Release
The Department of Justice announced that it has awarded over $480,000 to the Suffolk County Police Department as part of more than $17 million in grant funding to support the Project Safe Neighborhoods (PSN) Program. The funding will support a collaborative effort between Suffolk and Nassau Counties to identify and reduce violent crime and strengthen community partnerships and outreach. The funding will go to the Suffolk County Police Department, the Nassau County Police Department and the Nassau County District Attorney’s Office. Suffolk County has been receiving PSN grants since 2017 and has split the funding with Nassau County since 2018.
The Bureau of Justice Assistance (BJA), part of the department’s Office of Justice Programs (OJP), will administer the 88 grant awards to support local PSN projects that work in partnership with U.S. Attorneys’ Offices.
“The Project Safe Neighborhoods grant will support our efforts to collaborate with the Suffolk and Nassau County Police Departments in developing strategies to reduce gang and gun violence on Long Island. The grant will also help to strengthen our partnerships with community organizations and expand our community outreach programs. Together, we will work hard to make our communities safer,” stated United States Attorney Breon Peace.
“This latest Project Safe Neighborhoods grant is critical to addressing the violent crime threatening cities and towns all across our country,” said Deputy Attorney General Lisa O. Monaco. “Ensuring the safety of all Americans is the highest priority for the Department of Justice, but when it comes to violent crime, there is not a one-size-fits-all solution. We have to work closely with local public safety agencies as well as community organizations to craft individual strategies unique to each community’s needs. Programs like Project Safe Neighborhoods and the funding it provides allow us to do just that.”
“Investing in our communities, supporting victims and building a justice system that both keeps people safe and earns their trust – these are mutually reinforcing goals that stand at the heart of Project Safe Neighborhoods,” stated Principal Deputy Assistant Attorney General Amy L. Solomon for OJP. “The Office of Justice Programs is pleased to join with our U.S. Attorneys’ Offices, and with jurisdictions across the country, as we work together to meet the challenges of crime and violence and achieve our shared aspirations of public safety and community trust.”
In May 2021, Attorney General Merrick B. Garland announced a new effort to reduce violent crime, including the gun violence that is often at its core. Integral to that effort was the reinvigoration of PSN, a two-decade old evidence-based and community-oriented program focused on reducing violent crime. The updated PSN approach, outlined in the department’s Comprehensive Strategy for Reducing Violent Crime issued by Deputy Attorney General Monaco, is guided by four key principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence, setting focused and strategic enforcement priorities and measuring the results of our efforts. The fundamental goal is to reduce violent crime, not simply to increase the number of arrests or prosecutions.
This fall, U.S. Attorney’s Offices across the country have enhanced their violent crime reduction efforts to ensure alignment with the department’s comprehensive violent crime reduction strategy. U.S. Attorneys’ Offices have engaged in outreach to law enforcement and other agencies and organizations serving communities to identify the most significant drivers of violence in their districts. Working together with a broad coalition of stakeholders, the U.S. Attorneys’ Offices are addressing the most pressing violent crime issues in their district to make our neighborhoods safer for all.
PSN programs are led by U.S. Attorneys’ Offices in collaboration with local public safety agencies, community stakeholders and other agencies and organizations that work to reduce violent crime.
The Office of Justice Programs provides federal leadership, grants, training, technical assistance and other resources to improve the nation’s capacity to prevent and reduce crime, advance racial equity in the administration of justice, assist victims and enhance the rule of law. More information about OJP and its components can be found at www.ojp.gov.
Wading River Woman Sentenced to 10 Years in Prison for Conspiring to Distribute Narcotics and Firearm PossessionRead the Press Release
Earlier today, in federal court in Central Islip, Amber Schatz was sentenced by United States District Judge Denis R. Hurley to 10 years in prison for conspiring to distribute controlled substances and the possession of a firearm in furtherance of drug trafficking. Schatz pleaded guilty to these charges in May 2021.
Breon Peace, United States Attorney for the Eastern District of New York, announced the sentence.
“Today’s sentence demonstrates that defendants like Schatz who contribute to the opioid epidemic and put communities at risk by openly selling large quantities of dangerous drugs will face serious consequences,” stated United States Attorney Breon Peace. “I commend our law enforcement partners at the Federal Bureau of Investigation, the Suffolk County East End Drug Task Force and the Riverhead Police Department who are working tirelessly to remove drug dealers and their guns from the streets of Long Island.”
Mr. Peace thanked the Federal Bureau of Investigation, New York Field Office, Suffolk County East End Drug Task Force and the Riverhead Police Department for their work on the case.
According to public filings and statements made by Schatz during her guilty plea, in January 2020, Schatz and her boyfriend, Curtis Prussick, conspired to distribute large quantities of narcotics, including fentanyl. Following an investigation into community complaints of individuals distributing drugs at public places in Suffolk County, law enforcement determined that Schatz and Prussick regularly sold drugs from parking lots around Rocky Point, New York. Members of the Suffolk County East End Drug Task Force executed a search warrant at Schatz and Prussick’s residence in Wading River and discovered a large-scale drug distribution operation. Law enforcement seized over 170 grams of fentanyl, over 125 grams of cocaine and 40 grams of crack cocaine as well as quantities of oxycodone and heroin. Additionally, materials for packaging drugs, a pill press that the defendants used to press fentanyl into pill form and an assault rifle that they used to protect their drug operation were seized. Schatz and Prussick were arrested in February 2020 and the charges against Prussick are pending.
The government’s case is being handled by the Office’s Long Island Criminal Division. Assistant United States Attorney Michael Maffei is in charge of the prosecution.
The Defendant:
AMBER L. SCHATZ
Age: 33
Wading River, New YorkE.D.N.Y. Docket No. 20-CR-48 (DRH)
Former Finance Executive Sentenced to 138 Months in Prison for Orchestrating Massive Market Manipulation SchemeRead the Press Release
Earlier today, in federal court in Brooklyn, Abraxas J. Discala, also known as “AJ Discala,” the former Chief Executive Officer of OmniView Capital Advisors LLC (“OmniView”), was sentenced by United States District Judge Eric N. Vitaliano to 138 months’ imprisonment for orchestrating a multi-million dollar market manipulation scheme. The Court also ordered Discala to pay $2,484,873 in forfeiture. The amount of restitution will be determined by the Court at a later date. Discala was convicted by a federal jury in May 2018 following a five-week trial of two counts of securities and wire fraud conspiracy, two counts of securities fraud, and four counts of wire fraud relating to his manipulation of stocks of multiple microcap or “penny” stocks, including the stock of CodeSmart Holding, Inc. (“CodeSmart”), Cubed, Inc. (“Cubed”), and others, (collectively the “Manipulated Public Companies”).
Breon Peace, United States Attorney for the Eastern District of New York, and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the sentence.
“Discala conspired to manipulate trading activity in penny stocks in furtherance of a scheme to defraud the securities market and investing public of millions of dollars,” stated United States Attorney Peace. “With today’s sentence, Discala has been held accountable for his crimes and the harm he caused to investors.” Mr. Peace thanked the Federal Bureau of Investigation, New York Field Office, and the United States Securities and Exchange Commission, New York Regional Office, for their invaluable efforts in the case.
Discala purported to raise capital for start-up private companies and offered to take them public through reverse mergers with public shell companies in exchange for obtaining control of a large portion of the free trading or unrestricted stock. Discala and his co-conspirators, including co-defendants Ira Shapiro, Marc Wexler, Matthew Bell, Craig Josephberg, Victor Azrak, Darren Goodrich, Darren Ofsink and Michael Morris, then artificially inflated the stock through manipulative trading and promotional campaigns, generating large profits for themselves at the expense of unwitting investors.
As part of the fraud, Discala orchestrated a scheme to manipulate the stock price of CodeSmart and Cubed, two of the Manipulated Public Companies.
The CodeSmart Scheme
In early May 2013, Discala and his co-conspirators, including attorney Ofsink, engineered a reverse merger of CodeSmart, a private company, with a shell public company. After gaining control of CodeSmart’s unrestricted shares, Discala and his co-conspirators fraudulently inflated CodeSmart’s share price and trading volume on two occasions and then sold the unrestricted CodeSmart stock at a profit when the share price reached desirable levels. Shapiro, the Chief Executive Officer of CodeSmart, issued numerous press releases with false information to facilitate inflating CodeSmart’s stock price.
Discala and his co-conspirators, including Wexler, profited by selling CodeSmart stock, issued to them for pennies, to clients and customers of Bell, an investment advisor, and Josephberg, a registered broker. On some occasions, the CodeSmart shares were sold to Bell’s clients and Josephberg’s customers without their clients’ and customers’ knowledge and consent. Additionally, Bell and Josephberg sold CodeSmart shares in their personal trading accounts at the same time that they purchased CodeSmart stock in their clients’ and customers’ accounts.
Discala, Wexler, Bell, Josephberg, Ofsink and Morris made more than $6 million in illicit trading profits from the CodeSmart scheme, and the co-conspirators caused more than $12 million in losses to approximately 800 CodeSmart investors who purchased the publicly traded stock.
The Cubed Scheme
In March 2014, Discala and his co-conspirators took Cubed public through an asset purchase agreement by a shell public company. After gaining control of all of Cubed’s unrestricted shares, between April 22, 2014 and April 30, 2014, Discala and his co-defendants, including Wexler, Bell, Josephberg, Goodrich and Azrak, concocted trading volume in the stock and were able to successfully control the price and volume of Cubed’s stock. On June 23, 2014, Cubed reached its highest closing price of $6.75 per share, resulting in a market capitalization of approximately $200 million. Investors who bought publicly traded Cubed stock lost over $400,000. In addition, Cubed was able to raise over $2 million in a private offering of stock to investors who were deceived by how Cubed stock was performing in the market. Discala and Wexler also made over $1 million worth of illegal private sales of Cubed stock to over three dozen investors. Discala and his co-conspirators caused more than $4 million in total losses to approximately 100 Cubed investors.
Goodrich, a broker who participated in the scheme to manipulate the stock of Cubed, was previously sentenced to 41-months after pleading guilty to securities fraud conspiracy. Shapiro, Wexler, Bell, Josephberg, Azrak, Ofsink and Morris also pleaded guilty and are awaiting sentencing.
The government’s case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys Shannon C. Jones and Patrick T. Hein are in charge of the prosecution. Assistant United States Attorney Claire Kedeshian of the Office’s Asset Recovery Section is handling forfeiture matters.
The Defendant:
ABRAXAS J. DISCALA (also known as “AJ Discala”)
Age: 50
Darien, ConnecticutE.D.N.Y. Docket No. 14-CR-399 (S-1)(ENV)
Queens Pharmacist Indicted for Conspiring to Accept Kickbacks and Making False StatementsRead the Press Release
Earlier today, in federal court in Brooklyn, an indictment was unsealed charging Bruce Snipas, the owner and pharmacist-in-charge of B&E Pharmaceuticals, Inc. (“B&E”) in Rego Park, New York, with conspiracy to make false statements in health care matters, making false statements in health care matters and conspiracy to violate the Anti-Kickback Statute. Snipas was arrested this morning and arraigned this afternoon before United States Magistrate Judge Robert M. Levy. The defendant was released on a $150,000 bond.
Breon Peace, United States Attorney for the Eastern District of New York and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the arrest and charges.
“As alleged, the defendant, a pharmacist and health care professional, engaged in a fraudulent scheme to take advantage of the Medicaid program and profit by accepting hundreds of thousands of dollars in kickbacks,” stated United States Attorney Peace. “This Office is committed to protecting the integrity of government programs, including health insurance programs like Medicaid that benefit the district’s most vulnerable residents.” United States Attorney Peace also thanked the United States Department of Health and Human Services, Office of Inspector General and the Department of Defense, Office of Inspector General.
“Snipas, as alleged, received hundreds of thousands of dollars in kickbacks while helping a health care company cover up their processing of fraudulent claims totaling more than $30 million. The FBI will continue our efforts to protect government-sponsored programs that exist to serve the interests of those within our community who need them most and private insurance programs that are adversely affected by this type of fraud,” stated FBI Assistant Director-in-Charge Driscoll.
As alleged in the indictment, from approximately April 2015 to February 2018, Snipas conspired with a Florida-based health care company (the “Health Care Company”) to conceal the Health Care Company’s involvement in processing over $30 million in fraudulently obtained prescription claims by B&E from various health care programs, including New York Medicaid. Snipas repeatedly made false claims to Federal and State regulators and pharmacy boards concealing the Health Care Company’s involvement in the operations of B&E. In exchange for assisting the Health Care Company in processing the prescriptions through B&E, Snipas received approximately $650,000 in kickbacks from the Health Care Company.
The charges in the indictment are allegations, and the defendant is presumed innocent unless and until proven guilty.
The case is being handled by the Office’s Health Care Fraud Task Force. Assistant United States Attorneys Erin E. Argo and Brian Morris are in charge of the prosecution.
The Defendant:
BRUCE SNIPAS
Age: 68
West Islip, New YorkE.D.N.Y. Docket No. 21-CR-605 (MKB)
Former Chief Deputy Nassau County Executive Sentenced to 18 Months in Prison for Obstructing JusticeRead the Press Release
Earlier today, in federal court in Central Islip, Richard “Rob” Walker, the former Chief Deputy County Executive under former Nassau County Executive Edward Mangano, was sentenced by United States District Judge Joan M. Azrack to 18 months in prison for obstruction of justice. The Court also ordered Walker to pay $5,000 in forfeiture, imposed a $5,500 fine and perform 2,000 hours of community service as part of his sentence. Walker pleaded guilty to the charge in May 2019.
Breon Peace, United States Attorney for the Eastern District of New York, and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the sentence.
“While occupying an important position of public trust, Walker accepted illicit payments from a contractor, encouraged the contractor to commit perjury before a federal grand jury, and lied to the FBI to cover up his crimes,” stated United States Attorney Peace. “This Office will prosecute corrupt officials like Walker who seek to obstruct justice and abuse the public trust.” Mr. Peace also expressed his thanks to Internal Revenue Service-Criminal Investigation for its help during the investigation.
“Public officials have a great responsibility to uphold the public’s trust and make legal and ethical decisions that serve to benefit their communities. Rob Walker did just the opposite when he accepted illicit payments from a contractor working for Nassau County and later attempted to cover his tracks and change his story once he realized the FBI was onto him. As we’ve said in the past, there’s no way to undo what’s already been done—a lesson that’s surely been reinforced today,” stated FBI Assistant Director-in-Charge Driscoll.
In 2014, Walker, who was then the Chief Deputy Nassau County Executive, accepted a $5,000 cash payment from a contractor who was performing work pursuant to a contract for Nassau County. In 2017, Walker learned that the United States Attorney’s Office for the Eastern District of New York and the FBI had opened a grand jury investigation of potential corruption in Nassau County government, including the circumstances surrounding the $5,000 payment made by the contractor to the defendant. Walker spoke to the contractor on several occasions and attempted to persuade him to conceal the existence of the $5,000 payment from the grand jury, or to provide a false explanation to the grand jury concerning the transaction, for example, saying it was repayment of a loan. Walker arranged to meet the contractor in a park in Hicksville, New York, and at that meeting, gave the contractor an envelope containing $5,000 in an effort to make it appear as if the payment Walker accepted “never happened.” Later, when he was interviewed by the FBI concerning the payment, Walker denied ever having received any cash payments from the contractor.
As recounted in consensually recorded conversations, Walker repeatedly claimed that the payment did not have to be disclosed to the grand jury if he returned it to the contractor. On one occasion, Walker said, “you [the contractor] only borrowed it and I gave it back to you…there was never a quid pro quo,” and if he returned the money, “it doesn’t exist…wouldn’t you rather it not existing?”
In another recorded conversation, Walker untruthfully stated, “[j]ust be honest. I borrowed the money from you. I gave it back to you…My mother-in-law was sick…it’s over.” During the exchange, which was recorded by law enforcement, Walker stated, “it [the money] doesn’t exist. That’s it.” When the contractor asked if he is “not saying a word [to the grand jury]?” Walker confirmed, “[n]ope, doesn’t exist.”
The government’s case is being handled by the Office’s Long Island Criminal Division. Assistant United States Attorneys Artie McConnell and Catherine M. Mirabile are in charge of the prosecution.
The Defendant:
RICHARD WALKER (also known as “Rob Walker”)
Age: 43
Hicksville, New YorkE.D.N.Y. Docket No. 18-CR-087 (JMA)
Long Island Man Charged with Mailing Threatening Letters to LGBTQ+ Affiliated Individuals and OrganizationsRead the Press Release
A criminal complaint was unsealed today in federal court in Central Islip charging Robert Fehring with mailing letters threatening to assault, shoot, and bomb LGBTQ+ affiliated individuals, organizations, and businesses. Fehring was arrested this morning and will make his initial appearance this afternoon before United States Magistrate Judge Steven I. Locke.
Breon Peace, United States Attorney for the Eastern District of New York, and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the arrest.
“As alleged, the defendant's hate-filled invective and threats of violence directed at members of the LGBTQ+ community have no place in our society and will be prosecuted to the fullest extent of the law," stated United States Attorney Peace. “This Office is firmly committed to protecting the civil rights of all members of every community in this district, including the LGBTQ+ community and other minority communities.” Mr. Peace thanked the Suffolk County Police Department for their invaluable assistance with the investigation.
“Fehring’s alleged threats to members of the LGBTQ+ community were not only appalling, but dangerous, despite the fact he hadn’t yet acted on his purported intentions,” stated FBI Assistant Director-in-Charge Driscoll. “As the primary federal agency responsible for investigating civil rights violations, the FBI takes all threats of this nature seriously. If you or someone you know has received a similar threat, report it to us by calling 1-800-CALLFBI. In an emergency, always call your local police department.”
As set forth in the complaint, since at least 2013, Fehring has been sending individuals associated with the LGBTQ+ community letters in which he threatened violence, including threatening the use of firearms and explosives. One letter threatened that there would “be radio-cont[r]olled devices placed at numerous strategic places” at the 2021 New York City Pride March with “firepower” that would “make the 2016 Orlando Pulse Nightclub shooting look like a cakewalk,” referencing the 2016 attack in which 49 persons were killed and dozens wounded at Pulse, a gay nightclub in Orlando, Florida.
Fehring is also alleged to have a sent a letter threatening the organizer of a June 2021 Pride event in East Meadow, New York, which stated:
“[W]e were right there you…FREAK!!! They couldn’t get a shot off at you, slithering around the back stage area like a snake. Too many cops. Very disappointed. But your time has come. . .. They are out to KILL you….and your boyfriend. You are being watched. No matter how long it takes, you will be taken out…. high-powered bullet…. bomb….knife…. whatever it takes.”
On November 18, 2021, members of the FBI’s Civil Rights Squad and the New York Joint Terrorism Task Force executed a search warrant at Fehring’s home in Bayport, New York, and recovered photographs from a June 2021 Pride event in East Meadow, New York, two loaded shotguns, hundreds of rounds of ammunition, two stun guns, and a stamped envelope addressed to an LGBTQ+ affiliated attorney containing the remains of a dead bird.
The charge in the complaint is an allegation and the defendant is presumed innocent unless and until proven guilty.
The government’s case is being handled by the Office’s National Security and Cybercrime Section, Long Island Criminal Division and Civil Rights Section. Assistant United States Attorneys Francisco J. Navarro, Rachel A. Bennek, and Andrew P. Wenzel are in charge of the prosecution.
The Defendant:
ROBERT FEHRING
Age: 74
Bayport, New YorkE.D.N.Y. Docket No. 21-MJ-1363
Founder of Investment Advisory Firm Charged with Wire Fraud, Investment Adviser Fraud and Money LaunderingRead the Press Release
An indictment was unsealed today in federal court in Central Islip charging Jeffrey Slothower, a former registered investment adviser and founder of the New York investment advisory firm Battery Private, Inc. (“Battery Private”), with wire fraud, investment adviser fraud, and money laundering in connection with a scheme to misappropriate more than $1 million from current and prospective clients. Slothower was arrested earlier today in Southampton, New York, and will make his initial appearance via videoconference this afternoon before United States Magistrate Judge Steven L. Tiscione.
Breon Peace, United States Attorney for the Eastern District of New York, and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the arrest and charges.
“As alleged, Slothower executed a calculated scheme in which he repeatedly lied to his current and prospective clients about putting their money into legitimate investments, when in reality he stole their money to fund his lavish lifestyle,” stated United States Attorney Peace. “This Office will vigorously investigate and prosecute corrupt financial advisers like the defendant who abuse their clients’ trust and violate the law to enrich themselves.” Mr. Peace thanked the Securities and Exchange Commission, New York Regional Office, for their assistance during the investigation.
“Slothower joins the long-running list of those who exploit their position as investment advisors to siphon funds from their investors directly into their own pockets. This type of behavior is not only damaging to investors, but to the overall economy as well. The FBI continues with our dedicated efforts to investigate those who commit this type of fraud wherever and whenever we can,” stated FBI Assistant Director-in-Charge Driscoll.
As set forth in the indictment, Slothower was the founder and operator of Battery Private, a New York investment advisory firm. While operating Battery Private, Slothower solicited business from Victim-1 and Victim-2, a couple from California whose money Slothower had managed at another financial services firm. Slothower promised the victims he could beat any rate of return they were receiving and do so without market risk. Victim-2 thereafter signed an investment advisory contract with Battery Private. Slothower continued soliciting Victim-1’s business, and, in 2017, he offered to invest Victim-1’s money into what Slothower described as bonds backed by homeowner’s association fees (the “HOA Bonds”), which would pay Victim-1 an eight percent return. Based on these representations, Victim-1 agreed to invest money with Slothower through Battery Private.
Slothower sent Victim-1 wiring instructions for his investment and attached a document that made additional representations about Victim-1’s purported investment, claiming that Victim-1’s money would be held in the “capital reserves” of Battery Private. Thereafter, between January 25, 2017 and January 27, 2017, Victim-1 sent more than $500,000 to Slothower at Battery Private to be invested in the purported HOA Bonds. However, that money was not invested in HOA Bonds or held in “capital reserves” as represented by Slothower; instead, Slothower used that money to, among other things, wire money to himself, purchase a luxury automobile and pay fees for a private golf club on Long Island. To further the fraudulent scheme, Slothower thereafter made payments to Victim-1 that were falsely represented as quarterly distributions from Victim-1’s investment.
Later, Slothower sought out additional funds and asked Victim-1 to find money to invest including money from Victim-2 who was then a Battery Private client. Victim-2 learned about the HOA Bond investment from Victim-1, including the fact that Victim-1 had been receiving purported quarterly returns from the investment. Thereafter, Victim-2 agreed to invest in the same purported HOA Bonds, and in or about December 2017, Victim-2 sent more than $500,000 to Slothower at Battery Private that was for investment in the HOA Bonds. However, like Victim-1, Victim-2’s money was not invested in HOA Bonds or held in “capital reserves” as represented by Slothower. Instead, Slothower used that money to, among other things, pay personal credit card bills. To further the fraudulent scheme, Slothower made payments to Victim-2 that were falsely represented as quarterly distributions from Victim-2’s investment
In June 2018, Victim-1 made an additional investment of approximately $84,000 into the purported HOA Bonds. Again, Slothower did not invest that money in HOA Bonds or hold it as “capital reserves,” as he previously represented. Instead, Slothower used Victim-1’s money to, among other things, make purported quarterly payments to Victim-1 and Victim-2 that were falsely represented as their investment returns and to pay the private golf club on Long Island.
The charges in the indictment are allegations, and the defendant is presumed innocent unless and until proven guilty. If convicted, Slothower faces up to 20 years in prison.
The government’s case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys Drew G. Rolle and Michael Bushwack are in charge of the prosecution.
The Defendant:
JEFFREY SLOTHOWER
Age: 43
Southampton, New YorkE.D.N.Y. Docket No. 21-CR-602 (GRB)
MS-13 Gang Associate Pleads Guilty to Participating in the 2017 Murders of Four Young Men in a Central Islip ParkRead the Press Release
Anderson Sanchez, an associate of the Leeward Locos Salvatruchas clique of La Mara Salvatrucha, also known as the MS-13, a transnational criminal organization, pleaded guilty yesterday in federal court in Central Islip to racketeering charges in connection with his participation in the April 11, 2017 murders of Justin Llivicura, Michael Lopez, Jorge Tigre, and Jefferson Villalobos. The proceeding was held before United States Magistrate Judge Steven I. Locke.
Breon Peace, United States Attorney for the Eastern District of New York, Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Stuart Cameron, Acting Commissioner, Suffolk County Police Department (SCPD), announced the guilty plea.
“With today’s guilty plea, Sanchez admits to being a willing participant in the stabbing and beating deaths of four young men for their alleged ‘disrespect’ of the MS-13 and is held accountable for his horrific crime,” stated United States Attorney Peace. “This Office and the Long Island Gang Task Force will not rest until the brutality of the MS-13 gang is eliminated for good from our communities.”
According to court filings and statements by the defendant at the guilty plea proceeding, on the evening of April 11, 2017, two female associates of the MS-13 lured five young men, including the four victims, to a community park in Central Islip where they were attacked and killed. The MS-13 members and associates believed the victims to be members of a rival gang who had disrespected the MS-13. Sanchez and several other MS-13 members and associates met in a wooded area behind the park where weapons were distributed and the plan to kill the victims was discussed. The female associates arrived at the park, led the victims to a predetermined wooded area and sent the MS-13 members a text message notifying them of their arrival. Sanchez and the other MS-13 members and associates proceeded to the designated location and encircled the victims under the cover of darkness. One of the intended victims immediately fled and was able to escape. Llivicura, Lopez, Tigre and Villalobos were surrounded by Sanchez and others, who prevented their escape, while other MS-13 members, armed with machetes, knives, and wooden clubs, led the victims deeper into the woods where they were brutally murdered. After the attack, the MS-13 members dragged the victims’ bodies to a more secluded spot in the woods and then fled. The victims’ bodies were discovered the following evening.
More than a dozen MS-13 members and associates have been charged in connection with the April 11 murders.
When sentenced, Sanchez faces a maximum sentence of life in prison. Upon completion of his sentence, he faces deportation from the United States.
Today’s conviction is the latest in a series of federal prosecutions by the United States Attorney’s Office for the Eastern District of New York targeting members of the MS-13, a violent, transnational criminal organization. The MS-13’s leadership is based in El Salvador, Honduras, Guatemala and Mexico, but the gang has thousands of members across the United States. With numerous branches, or “cliques,” the MS-13 is the most violent criminal organization on Long Island. Since 2003, hundreds of MS-13 members, including dozens of clique leaders, have been convicted on federal felony charges in the Eastern District of New York. A majority of those MS-13 members have been convicted on federal racketeering charges for participating in murders, attempted murders and assaults. Since 2010, this Office has obtained indictments charging MS-13 members with carrying out more than 60 murders in the Eastern District of New York, resulting in the convictions of dozens of MS-13 leaders and members in connection with those murders. These prosecutions are the product of investigations led by the FBI’s Long Island Gang Task Force, which is comprised of agents and officers of the FBI, SCPD, Nassau County Police Department, Nassau County Sheriff’s Department, Suffolk County Probation Office, Suffolk County Sheriff’s Office, the New York State Police, the Hempstead Police Department, the Rockville Centre Police Department and the New York State Department of Corrections and Community Supervision.
The government’s case is being handled by the Office’s Long Island Criminal Division. Assistant United States Attorneys Paul G. Scotti, Justina L. Geraci and Megan E. Farrell are in charge of the prosecution.
The Defendant:
ANDERSON SANCHEZ
Age: 22
Central Islip, New YorkE.D.N.Y. Docket No. 21-CR-101 (JFB)
Panamanian Intermediary Pleads Guilty in Connection with International Bribery and Money Laundering SchemeRead the Press Release
Luis Enrique Martinelli Linares (Luis Martinelli Linares), 39, a citizen of Panama and Italy, pleaded guilty today in the Eastern District of New York before U.S. District Judge Raymond J. Dearie for laundering $28 million in connection with a massive bribery and money laundering scheme involving Odebrecht S.A. (Odebrecht), a Brazil-based global construction conglomerate.
According to court documents, the scheme involved the payment of more than $700 million in bribes to government officials, public servants, political parties, and others in Panama and other countries around the world to obtain and retain business for the company. On Dec. 21, 2016, Odebrecht pleaded guilty in the Eastern District of New York to a criminal information charging it with conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act (FCPA) for its involvement in the bribery and money laundering scheme.
Luis Martinelli Linares admitted that he agreed with his brother, Ricardo Alberto Martinelli Linares, and others to establish offshore bank accounts in the names of shell companies to receive and disguise over $28 million in bribe proceeds from Odebrecht for the benefit of his close relative, a high-ranking public official in Panama. To advance the scheme, Luis Martinelli Linares agreed with others to cause the wiring of the Odebrecht bribe funds into and out of the United States, and used some of the proceeds of the scheme to purchase a yacht and a condominium in the United States.
Luis Martinelli Linares pleaded guilty to one count of conspiracy to commit money laundering. He also agreed to a forfeiture amount of approximately $18.9 million. He is scheduled to be sentenced on May 20, 2022, and faces a maximum penalty of 20 years in prison. Judge Dearie will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Ricardo Alberto Martinelli Linares was arrested, along with his brother Luis Martinelli Linares, at el Aeropuerto Internacional la Aurora in Guatemala on July 6, 2020, pursuant to a provisional arrest request from the United States as they were attempting to depart Guatemala on a private plane. The defendants were charged on Feb. 4, 2021, in a five-count indictment in connection with this bribery and money laundering scheme. The United States continues its efforts to have Ricardo Martinelli Linares returned to the United States to face justice.
Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division, U.S. Attorney Breon Peace for the Eastern District of New York, and Acting Assistant Director Jay Greenberg of the FBI’s Criminal Investigative Division made the announcement.
The FBI’s International Corruption Unit in New York is investigating this case. The Justice Department’s Office of International Affairs provided substantial assistance in securing the arrest and extradition of Luis Martinelli Linares.
Trial Attorney Michael Culhane Harper of the Criminal Division’s Fraud Section, Trial Attorneys Barbara Levy and Michael Redmann of the Criminal Division’s Money Laundering and Asset Recovery Section (MLARS), and Assistant U.S. Attorney Alixandra E. Smith of the U.S. Attorney’s Office for the Eastern District of New York are prosecuting the case. Assistant U.S. Attorney Laura Mantell of U.S. Attorney’s Office for the Eastern District of New York’s Civil Division is handling forfeiture matters.
The Fraud Section is responsible for investigating and prosecuting all FCPA matters. Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.
The Kleptocracy Asset Recovery Initiative in MLARS was formed to prosecute money launderers and forfeit the proceeds of foreign official corruption and, where appropriate, to use those recovered asset to benefit the people harmed by the corruption and abuse of office. Individuals with information about possible proceeds of foreign corruption located in or laundered through the United States should contact federal law enforcement or send an email to [email protected].
An indictment is merely an allegation, and Ricardo Alberto Martinelli Linares is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Panamanian Intermediary Pleads Guilty for His Role in an International Bribery and Money Laundering SchemeRead the Press Release
BROOKLYN, NY – Earlier today, at the federal courthouse in Brooklyn, Luis Enrique Martinelli Linares (Luis Martinelli Linares) pleaded guilty to conspiracy to commit money laundering for his role in a massive bribery and money laundering scheme involving Odebrecht S.A. (Odebrecht), a Brazil-based global construction conglomerate. The proceeding was held before United States District Judge Raymond J. Dearie.
Breon Peace, United States Attorney for the Eastern District of New York, Kenneth A. Polite Jr., Assistant Attorney General of the Justice Department’s Criminal Division, and Michael J. Driscoll, Assistant Director-in-Charge of the Federal Bureau of Investigation, New York Field Office (FBI), announced the guilty plea.
The Odebrecht scheme involved a conspiracy to pay more than $700 million in bribes to government officials, public servants, political parties, and others in Panama and other countries around the world, to obtain and retain business for the company. On December 21, 2016, Odebrecht pleaded guilty in the Eastern District of New York to a criminal information charging it with conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act.
At today’s plea hearing, Luis Martinelli Linares admitted that he entered into a conspiracy with his brother, Ricardo Alberto Martinelli Linares (Ricardo Martinelli Linares), and others, to establish offshore bank accounts in the names of shell companies in order to receive and disguise over $28 million in bribe proceeds from Odebrecht for the benefit of his close relative, a high-ranking public official in Panama. To advance the scheme, Luis Martinelli Linares admitted that he and others caused Odebrecht bribe funds to be wired into and out of the United States and used certain wire transfers involving the proceeds of the scheme to purchase a yacht and a condominium in the United States.
Luis Martinelli Linares and Ricardo Martinelli Linares were initially arrested at el Aeropuerto Internacional la Aurora in Guatemala on July 6, 2020, pursuant to a provisional arrest request from the United States as they were attempting to depart Guatemala on a private plane. The defendants were charged on February 4, 2021, in an indictment in connection with this bribery and money laundering scheme. The United States has also requested to extradite Ricardo Martinelli Linares, and those proceedings are ongoing.
The case is being prosecuted by Assistant United States Attorney Alixandra Smith of the Office’s Business and Securities Fraud Section, Trial Attorney Michael Culhane Harper of the Criminal Division’s Fraud Section, and Trial Attorneys Barbara Levy and Michael Redmann of the Criminal Division’s Money Laundering and Asset Recovery Section. Assistant United States Attorney Laura Mantell of the Office’s Civil Division is handling forfeiture matters. The FBI’s International Corruption Unit in New York is investigating this case.
The Defendants:
LUIS ENRIQUE MARTINELLI LINARES
Age: 39
Panama City, PanamaRICARDO ALBERTO MARTINELLI LINARES
Age: 42
Panama City, PanamaE.D.N.Y. Docket No. 21-CR-65 (RJD)
Long Island Attorney Sentenced to 57 Months in Prison for Stealing Wrongful Death Inheritance from ChildRead the Press Release
Earlier today, in federal court in Central Islip, Vincent J. Trimarco, Jr., an attorney admitted to practice law in New York State since 1997, was sentenced by United States District Judge Joan M. Azrack to 57 months in prison for conspiracy to commit mail and wire fraud in a scheme to defraud a minor of her inheritance from a federal wrongful death lawsuit. The Court also ordered Trimarco to pay restitution in the amount of $1.5 million, and forfeiture in the amount of $1.5 million. Trimarco pleaded guilty to the charges in October 2020.
Breon Peace, United States Attorney for the Eastern District of New York, and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the sentence.
“Trimarco’s theft of a seven-figure inheritance from a child so that he could purchase luxury vehicles and invest in real estate is a disgraceful breach of trust and betrayal of his time-honored duties as an attorney. His conduct is an affront to the courts, the bar and the community at large,” stated United States Attorney Peace. “Today’s sentence should serve as a warning that this Office will prosecute corrupt attorneys who abuse their positions and break the law for personal gain.”
From April 2012 through August 2017, Trimarco and a co-conspirator executed a scheme to defraud a minor, who was the co-conspirator’s grandchild, of settlement proceeds stemming from a wrongful death action. Using the settlement proceeds, Trimarco and the co-conspirator purchased luxury vehicles, including a Ferrari F430 Spider for $200,000 and a Jaguar XKR convertible for $57,000, as well as multiple properties in Suffolk County for over $600,000, and invested approximately $800,000 in the Emporium, a now-defunct nightclub and music venue in Patchogue, New York, in which Trimarco was, at times, a part owner. Despite orders from the Suffolk County Surrogate’s Court in April 2012, June 2012 and August 2012 restraining the disbursement of the settlement proceeds and ultimately directing that they be returned, Trimarco and his co-conspirator sold the assets that they purchased with the settlement proceeds, but did not return the proceeds to the rightful heir.
The government’s case is being handled by the Office’s Long Island Criminal Division. Assistant United States Attorneys Catherine M. Mirabile and Michael J. Bushwack are in charge of the prosecution, with the assistance of Assistant United States Attorney Madeline O’Connor, who is handling forfeiture matters.
The Defendant:
VINCENT J. TRIMARCO, Jr.Age: 52
Smithtown, New YorkE.D.N.Y. Docket No. 17-CR-583 (S-1) (JMA)
Brooklyn Man Sentenced to 43 Years’ Imprisonment for Armed Robberies of Convenience Stores in QueensRead the Press Release
Earlier today, in federal court in Brooklyn, Elgin Brack was sentenced by United States District Judge Eric N. Vitaliano to 43 years’ imprisonment for his role in the armed robberies of four convenience stores in Queens. Elgin Brack was convicted following a two-week trial in March 2020 of three counts of robbery, one count of attempted robbery, one count of conspiracy to commit robbery, one count of discharging a firearm during a crime of violence and three counts of brandishing a firearm during a crime of violence. As part of his sentence, the Court also ordered Elgin Brack to pay $1,264,536.86 in restitution. Elgin Brack’s co-defendant, Scott Brack, pleaded guilty in November 2019 for his participation in the robbery conspiracy and is awaiting sentencing.
Breon Peace, United States Attorney for the Eastern District of New York, John B. DeVito, Special Agent-in-Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives, New York Division (ATF), and Dermot F. Shea, Commissioner, New York City Police Department (NYPD), announced the sentence.
“With today’s sentence, the defendant is deservedly punished for brutally shooting an innocent employee in the head and hand, and for committing violent armed robberies of convenience stores that jeopardized the safety of innocent people,” stated United States Attorney Peace. “This Office will continue to vigorously prosecute defendants like Brack who engage in gun violence that threatens the safety of the community and endangers customers and hardworking store employees.”
“Our NYPD officers work tirelessly to prevent and fight the kind of violent crime that threatens the fabric of life for everyone in our city. This sentence today strengthens our commitment to the public and highlights the joint work of our NYPD officers, law enforcement partners and prosecutors from the United States Attorney’s Office in the Eastern District of New York in achieving a measure of justice in this case,” stated NYPD Commissioner Shea.
During the early morning hours of November 26, 2018, Elgin Brack robbed at gunpoint a Duane Reade store, a 7-Eleven, and two Rite-Aid stores. During each robbery, Elgin Brack pretended to make a purchase. When the store employee opened the cash register drawer to complete the sale, the defendant brandished a .357 Magnum revolver, pointed it at the cashier and demanded money. During the first robbery, the defendant shot the Duane Reade store clerk in the hand and the head and then fled emptyhanded. The victim survived the shooting. After each robbery, Elgin Brack was picked up by a getaway car driven by his uncle and co-defendant Scott Brack.
This case was brought as part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. As part of the program, U.S. Attorneys’ Offices work in partnership with federal, state, local and tribal law enforcement and their local communities to develop effective, locally based strategies to reduce violent crime.
The government’s case is being handled by the Office’s Organized Crime and Gangs Section. Assistant United States Attorneys Jonathan Siegel and Jonathan P. Lax are in charge of the prosecution. Assistant United States Attorney Tanisha R. Payne of the Office’s Asset Recovery Section is handling the forfeiture matters.
The Defendant:
ELGIN BRACK
Age: 24
Brooklyn, New YorkCo-Defendant Who Previously Pleaded Guilty:
SCOTT BRACK
Age: 51
Bronx, New YorkE.D.N.Y. Docket No. 18-CR-684 (ENV)
Member of Brooklyn Street Gang Sentenced to 32 Years’ Imprisonment for Racketeering ConspiracyRead the Press Release
Earlier today, in federal court in Brooklyn, Michael Liburd, a member of the Coney Island-based street gang known as the West End Enterprise, was sentenced by United States District Court Judge Edward R. Korman to 32 years’ imprisonment following his conviction for racketeering conspiracy, including his participation in the 2016 murder of Antwon Flowers and the extortion of public works employees in Coney Island. The defendant pleaded guilty to the charges on November 18, 2021.
Breon Peace, United States Attorney for the Eastern District of New York, Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), Keith Kruskall, Acting Special Agent-in-Charge, Drug Enforcement Administration, New York Division (DEA), and Dermot F. Shea, Commissioner, New York City Police Department (NYPD), announced the sentence.
“Today’s sentence not only holds the defendant accountable for his numerous acts of violence, but also sends a powerful message that this Office and its law enforcement partners are committed to aggressively prosecuting members of violent street gangs. We will do all we can to make our communities safe,” stated United States Attorney Peace. Mr. Peace thanked the New York City Housing Authority Office of the Inspector General for their assistance in the investigation and prosecution.
“This case is yet another example of the deadly relationship between drugs and violence,” stated DEA Acting Special Agent-in-Charge Kruskall. “The sentence imposed sends a message to other criminal organizations that law enforcement will not tolerate these brazen acts of violence in our communities. I commend the tireless efforts of all our law enforcement partners in bringing this dangerous perpetrator to justice.”
Liburd was a member of the West End Enterprise, a street gang composed of individuals residing in and around the Sea Rise Apartments, the Gravesend Houses and Surfside Gardens, also known as the “Mermaid Houses,” located in Coney Island. Liburd and his co-conspirators committed multiple crimes, including the extortion of public works employees at a Brooklyn construction site, violent robberies, witness intimidation and retaliatory shootings against members of a rival gang known as “Sex Money Murder,” and the January 17, 2016 murder of Antwon Flowers.
Liburd murdered Flowers in retaliation for the victim’s purported role in the killing of a West End Enterprise leader the previous day. As captured on surveillance video, Liburd and his co-conspirators followed Flowers as he exited the Mermaid Houses, at which point, the defendant pulled out a gun and shot Flowers in the back of the head, killing him instantly. Liburd’s co-defendant Maurice Washington was previously sentenced to 25 years’ imprisonment for his role in the racketeering conspiracy and murder.
This case was brought as part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. As part of the program, U.S. Attorneys’ Offices work in partnership with federal, state, local and tribal law enforcement and their local communities to develop effective, locally based strategies to reduce violent crime.
The government’s case is being handled by the Office’s Organized Crime and Gangs Section. Assistant United States Attorneys Jennifer M. Sasso, Kayla C. Bensing and Lindsey R. Oken are in charge of the prosecution.
The Defendant:
MICHAEL LIBURD (also known as “Mike Mike” and “Mitty”)
Age: 35
Brooklyn, New YorkE.D.N.Y. Docket No. 17-CR-296 (ERK)
Individual Who Portrayed Himself as Experienced Stock Trader Pleads Guilty to Defrauding InvestorRead the Press Release
Earlier today, at the federal courthouse in Brooklyn, Gonzalo Ortiz pleaded guilty to investment adviser fraud in connection with a scheme to defraud an investor of nearly $600,000 by making false representations about his trading expertise and the profitability of various investments. The proceeding was held before United States District Judge William F. Kuntz, II.
Breon Peace, United States Attorney for the Eastern District of New York, and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the guilty plea.
“Ortiz masqueraded as an experienced stock trader who could substantially increase the victim’s savings, but instead he stole close to a quarter million dollars of the victim’s money to use for his own personal benefit,” stated United States Attorney Peace. “This Office will continue to prosecute and hold accountable those who engage in fraud and steal the hard-earned money of investors.” Mr. Peace expressed his appreciation to the United States Securities and Exchange Commission, New York Regional Office, for its assistance in this case.
“Ortiz misrepresented to his victim his ability to invest funds in a profitable way, not only causing a significant loss in value, but also reserving a good deal of the money for his own personal benefit,” stated FBI Assistant Director-in-Charge Driscoll. “Investment fraud schemes are all too common, often causing emotional trauma to those affected. Our office is committed to investigating this type of criminal activity and holding the perpetrators accountable.”
Between approximately April 2015 and May 2017, Ortiz falsely represented himself to an investor (the “Victim”) as a successful investment adviser who had made profits for other individuals by trading stocks on their behalf. Ortiz convinced the Victim to allow him to invest the Victim’s money, promising significant returns. Based on those misrepresentations, the Victim made successive investments with Ortiz over a period of years. During this time, Ortiz falsely told the Victim that the investments were profitable and sent the Victim a false account statement to support these claims. In reality, Ortiz made poor trading decisions that resulted in the loss of a portion of the Victim’s money, and also stole some of the Victim’s money for himself, siphoning off portions of the investments to pay for personal expenses including clothing, food and car payments. Ortiz controlled nearly $600,000 of the Victim’s money, stole approximately $224,500 for himself and lost a significant amount of the Victim’s money to unprofitable trades.
The case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorney Andrew D. Grubin is in charge of the prosecution.
The Defendant:
GONZALO ORTIZ
Age: 48
Hackensack, New JerseyE.D.N.Y. Docket No. 19-CR-161 (WFK)
Queens Man Sentenced to 19 Months in Prison for Threatening to Murder Members of CongressRead the Press Release
Earlier today, at the federal courthouse in Brooklyn, Brendan Hunt was sentenced by United States District Judge Pamela K. Chen to 19 months’ imprisonment for threatening to assault and murder members of the United States Congress to impede, interfere with and intimidate those members and to retaliate against them on account of their performance of their official duties. Hunt was convicted of that charge after a jury trial in April 2021, which was the first trial to address the consequences of the January 6, 2021 assault on the Capitol.
Breon Peace, United States Attorney for the Eastern District of New York, and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the sentence.
“We will not tolerate threats to members of the United States Congress or calls to overthrow our democratically elected government,” stated United States Attorney Peace. “Not only will we investigate and vigorously prosecute these crimes, but today’s sentence sends a clear message that those who seek to harm our representatives and bring chaos to our democracy will be punished.”
On January 8, 2021, two days after the violent attack on the U.S. Capitol in Washington, D.C., Hunt posted a video titled “KILL YOUR SENATORS” that included the summary “Slaughter them all,” to BitChute, an Internet-based video sharing site. In the video, Hunt made dangerous additional threats, exhorting his viewers to violence and telling them that “[w]e need to go back to the U.S. Capitol when all of the Senators and a lot of the Representatives are back there, and this time we have to show up with our guns. And we need to slaughter these m-----f-----s.” Hunt also advocated for the violent overthrow of the federal government, claiming that “our government at this point is basically a handful of traitors . . . so what you need to do is take up arms, get to D.C., probably the inauguration . . . so called inauguration of this m-----f-----g communist Joe Biden . . . [T]hat’s probably the best time to do this, get your guns, show up to D.C., and literally just spray these m-----f-----s . . . put some bullets in their f------g heads.” Hunt stated, “If anybody has a gun, give me it, I’ll go there myself and shoot them and kill them . . . [W]e have to take out these Senators and then replace them with actual patriots. This is a [Zionist Occupied Government].”
On January 9, 2021, the defendant posted another video in which he stated “[t]hose 100 Senators should really be afraid about going into public now” and that “We have the first amendment, that’s still around, remember? And we have the second as well. There are really only a hundred of these weakling Senators. They are mass murdering psychopaths who are intent on our destruction, and they form an illegitimate government. Every single one of them just needs to go.”
The government’s case is being handled by the Office’s National Security and Cybercrime Section. Assistant United States Attorneys David K. Kessler, Ian C. Richardson and Francisco J. Navarro are in charge of the prosecution.
The Defendant:
BRENDAN HUNT
Age: 37
Ridgewood, QueensE.D.N.Y. Docket No. 21-CR-086 (PKC)
Man Sentenced to More Than 16 Years’ Imprisonment for Attempting to Provide Material Support to TerroristsRead the Press Release
A New York man was sentenced today to 200 months, more than 16 years, in prison for attempting to provide material support and resources to the designated foreign terrorist organizations the Islamic State of Iraq and al-Sham (ISIS) and the al-Nusrah Front.
Elvis Redzepagic, 30, of Commack, pleaded guilty in April 2021. According to court documents, in early 2015, Redzepagic began communicating with an individual he believed to be both the commander of a battalion in Syria and a member of ISIS or the al-Nusrah Front, and made attempts to join that individual’s battalion to engage in violent jihad. In July 2015, Redzepagic traveled to Turkey and made multiple unsuccessful attempts to cross the border into Syria. Unable to enter Syria from Turkey, Redzepagic traveled to Jordan in August 2016, but was stopped and deported by Jordanian authorities.
In Facebook messages from October 2015, Redzepagic explained that “jihad” is when “you fight for the sake of God” and “die for the sake of Allah.” Redzepagic stated that he traveled to Turkey to “perform Jihad and join Jabhat Al-Nusra.” He predicted, “there will come a time where people will only know to say Allahu Akbar.” In subsequent interviews with law enforcement, Redzepagic admitted that at the time he attempted to enter Syria, he was prepared to strap a bomb to himself.
A search of the defendant’s laptop yielded a variety of ISIS-specific extremist propaganda, including ISIS nasheeds, or Islamist hymns, including the “ISIS Anthem” in English. Redzepagic also repeatedly accessed the website “Put hilafeta,” or “Way to the Caliphate,” a Bosnian-language website for prospective foreign fighters from the Balkans who primarily sought to join ISIS and wage jihad in Syria.
The FBI investigated the case. Valuable assistance was provided by the Justice Department’s Office of International Affairs, the FBI Legal Attaché Office for Serbia, and the Government of Montenegro Ministry of Justice, Prosecutor’s Office and Special Police Unit.
Assistant U.S. Attorneys Saritha Komatireddy and Artie McConnell for the Eastern District of New York and Trial Attorney Katie Sweeten of the National Security Division’s Counterterrorism Section prosecuted the case.
Long Island Man Sentenced to 200 Months’ Imprisonment for Attempting to Provide Material Support to TerroristsRead the Press Release
CENTRAL ISLIP, NY — Earlier today, at the federal courthouse in Central Islip, Elvis Redzepagic was sentenced by United States District Judge Denis R. Hurley to 200 months’ imprisonment for attempting to provide material support and resources to the designated foreign terrorist organizations the Islamic State of Iraq and al-Sham (ISIS) and the al-Nusrah Front. Redzepagic, a U.S. citizen, pleaded guilty to the charge in April 2021.
Breon Peace, United States Attorney for the Eastern District of New York, Matthew G. Olsen, Assistant Attorney General of the Justice Department’s National Security Division, and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the sentence.
“With the imposition of today’s lengthy sentence, Redzepagic pays a steep price for his misguided embrace of terrorism and his attempts to join ISIS and the al-Nusrah Front in order to wage violent jihad,” stated United States Attorney Peace. “This Office, together with our law enforcement partners, will remain vigilant in protecting the public from terrorist threats and in thwarting their violent attacks here and abroad.”
Mr. Peace thanked the Justice Department’s Office of International Affairs, the FBI Legal Attaché Office for Serbia, and the Government of Montenegro Ministry of Justice, Prosecutor’s Office, and Special Police Unit for their assistance in this case.
In early 2015, Redzepagic began communicating with an individual he believed to be both the commander of a battalion in Syria and a member of ISIS or the al-Nusrah Front, and made attempts to join that individual’s battalion to engage in violent jihad. In July 2015, Redzepagic traveled to Turkey and made multiple unsuccessful attempts to cross the border into Syria. Unable to enter Syria from Turkey, Redzepagic traveled to Jordan in August 2016, but was stopped and deported by Jordanian authorities.
In Facebook messages from October 2015, Redzepagic explained that “jihad” is when “you fight for the sake of God” and “die for the sake of Allah.” Redzepagic stated that he traveled to Turkey to “perform Jihad and join Jabhat Al-Nusra.” He predicted, “there will come a time where people will only know to say Allahu Akbar.”
A search of the defendant’s laptop yielded a variety of ISIS-specific extremist propaganda, including ISIS nasheeds, or Islamist hymns, including the “ISIS Anthem” in English. Redzepagic also repeatedly accessed the website “Put hilafeta,” or “Way to the Caliphate,” a Bosnian-language website for prospective foreign fighters from the Balkans who primarily sought to join ISIS and wage jihad in Syria.
The government’s case is being handled by the Office’s National Security and Cybercrime Section. Assistant United States Attorneys Saritha Komatireddy and Artie McConnell are in charge of the prosecution, with assistance provided by Trial Attorney Stephanie Sweeten of the National Security Division’s Counterterrorism Section.
The Defendant:
ELVIS REDZEPAGIC
Age: 30
Commack, New YorkE.D.N.Y. Docket No. 17-CR-228 (DRH)
Queens Man Sentenced to 30 Years in Prison for Attempting to Provide Material Support to ISIS and an Additional 100 Months for Slashing a Correctional Officer at a Federal Jail in BrooklynRead the Press Release
Earlier today, at the federal courthouse in Brooklyn, Ali Saleh, a U.S. citizen from Queens, New York, was sentenced by United States District Judge William F. Kuntz, II, to 30 years’ imprisonment for attempting to provide material support and resources to the designated foreign terrorist organization the Islamic State of Iraq and al-Sham (ISIS). Saleh pleaded guilty to the charge in July 2018.
Saleh was also sentenced to 100 months’ imprisonment for assaulting a federal correctional officer and possessing contraband at the Metropolitan Detention Center in Brooklyn, New York (the “MDC”) to run consecutive to the terrorism sentence. Saleh pleaded guilty to the charge in June 2019.
Breon Peace, United States Attorney for the Eastern District of New York, Matthew G. Olsen, Assistant Attorney General for the Justice Department’s National Security Division, and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the sentence.
“Today’s sentence demonstrates the strong commitment of this Office and its law enforcement partners to rooting out and prosecuting dangerous jihadists like Saleh and stopping their efforts to support terrorist attacks at home or abroad,” stated United States Attorney Peace. “Saleh is also held accountable for his vicious and premeditated attack on a federal correctional officer while in pre-trial detention.”
“Saleh made numerous attempts to travel overseas to join ISIS, and when those efforts failed, attempted to assist others in joining the terrorist organization,” stated AAG Olsen. “Once arrested and detained, he attacked a correctional officer with an improvised weapon. With the sentences handed down today, he is being held accountable for these crimes. The National Security Division is committed to identifying and holding accountable those who seek to provide material support to foreign terrorist organizations and we will be unyielding in our efforts to bring to justice those who commit violence against the men and women in law enforcement and corrections. I want to thank the agents, analysts and prosecutors who are responsible for this case.”
“Ali Saleh’s attempts to support ISIS, and his subsequent attack on a federal correctional officer, resulted in the penalties enforced upon him today. The FBI’s JTTF here in New York, along with our partners, continues to lead the way in preventing and intercepting threats posed by those like Saleh, who seek to harm our citizens at home and overseas,” stated FBI Assistant Director-in-Charge Driscoll.
Attempting to Provide Material Support to ISIS
Starting in 2013 and thereafter, Saleh swore an oath of allegiance to ISIS and embraced ISIS’s directive to either travel to the Middle East to fight for ISIS or take action at home in support of ISIS. On August 25, 2014, Saleh stated online, “I’m ready to die for the Caliphate, prison is nothing.” On August 28, 2014, Saleh stated online, “Lets be clear the Muslims in the khilafah [caliphate] need help, the one who is capable to go over and help the Muslims must go and help.” That same day, Saleh made an airline reservation to travel from New York to Turkey, a country bordering Syria. Saleh was ultimately prevented from traveling because his parents took away his passport.
Saleh then redirected his efforts to facilitating others’ support of ISIS. In October 2014, Saleh communicated with an ISIS supporter in Mali through an online messaging platform and sent a wire transfer in the amount of $500 to fund that person’s travel to Syria. Around the same time period, Saleh communicated with several other individuals in an effort to facilitate their support of ISIS, including known ISIS supporters in the United Kingdom and Australia.
In July 2015, Saleh purchased 48 pyrotechnic mortars (large, tube-fired fireworks described as “artillery shells” on the packaging and containing explosive powder), stored them in a hidden area in the trunk of his car, and drove towards New York City. Law enforcement agents discovered on the cell phone that Saleh used at this time detailed instructions regarding how to create a bomb, including a hand thrown improvised explosive device, a pipe bomb, and a pressure cooker bomb, using explosive powder from fireworks. Saleh’s fireworks were sufficient to create multiple hand thrown IEDs or a pressure cooker bomb. As Saleh drove toward New York City with the explosive materials in his trunk, his car broke down, and he was forced to have it towed. Saleh later abandoned the car.
Saleh then made five separate attempts, over 10 days, to travel to the Middle East to fight for ISIS. On July 24, 2015, Saleh contacted an ISIS travel facilitator in Libya and made a same-day one-way booking to travel from New York to Cairo, Egypt. Notably, Egypt and Libya are bordering countries and it was relatively easy and common at that time for individuals to travel from Egypt to Libya to join ISIS. Saleh went to JFK and attempted to pay for the flight at the airline ticket counter, but he was informed by airline personnel that a message had come up on the screen and he left the ticket line. Saleh subsequently visited international airports in Newark, Philadelphia and Indianapolis, but continued to encounter travel restrictions. Saleh attempted to circumvent air travel restrictions by taking a train from Cleveland to Toronto, Canada, to fly to the Middle East from Canada. After law enforcement intervention, however, Saleh did not board the train and instead returned to New York.
After his encounters with law enforcement, Saleh changed his online social media moniker and expressed his support for ISIS under new usernames. On August 24, 2015, Saleh stated online, “I am a terrorist.” On September 1, 2015, Saleh stated online, “If they aren’t implementing shariah [Islamic law] grab ur gun and implement shariah and see how fast the world turns against u.”
In September 2015, Saleh was arrested at his home on charges of attempting to provide material support to ISIS. During a search of the home, agents recovered paper copies of an itinerary and Turkish visa issued in Saleh’s name for his September 2014 attempt to travel, and a duffel bag containing flashlights, headlamps, and other survival gear. Agents also recovered a black trunk containing 29 machetes. Saleh was subsequently detained at the MDC.
Assault on a Federal Correctional Officer
During his detention at the MDC, Saleh has assaulted numerous federal correctional officers and staff members, crafted weapons from materials in prison, broken cell windows and light fixtures, damaged property, initiated false emergency alarms, and set fires. In total, he has been cited on more than 90 separate occasions for disciplinary infractions at the MDC.
On July 13, 2018, at approximately 12:35 p.m., while a senior correctional officer was retrieving trash through an access slot of Saleh’s cell, Saleh reached through the slot and slashed the officer with an improvised knife, lacerating the officer’s right forearm and damaging the officer’s radial nerve. Saleh smiled at the officer and said, “I hope you die.” The correctional officer subsequently underwent surgery for his wound.
The government’s cases are being handled by the Office’s National Security & Cybercrime Section. Assistant United States Attorneys Saritha Komatireddy, Margaret E. Lee and Alexander F. Mindlin are in charge of the terrorism prosecution, with assistance provided by Trial Attorney Stephanie Sweeten of the National Security Division’s Counterterrorism Section. Assistant United States Attorney Douglas M. Pravda is in charge of the assault and contraband prosecution.
The Defendant:
ALI SALEH
Age: 28
Queens, New YorkE.D.N.Y. Docket Nos. 15-CR-517, 18-CR-468 (WFK)
Man Sentenced to 30 Years in Prison for Attempting to Provide Material Support to ISISRead the Press Release
A New York man was sentenced today to 30 years in prison for attempting to provide material support and resources to the Islamic State of Iraq and al-Sham, aka ISIS. The defendant was also sentenced to 100 months, or more than eight years’, imprisonment for assaulting a federal correctional officer and possessing contraband at the Metropolitan Detention Center (MDC) in Brooklyn, New York, to run consecutive to the terrorism sentence.
Ali Saleh, 28, of Queens, pleaded guilty to attempting to provide material support to ISIS in July 2018. According to court documents, starting in 2013, Saleh swore an oath of allegiance to ISIS and embraced ISIS’s directive to either travel to the Middle East or take action at home in support of ISIS. On Aug. 25, 2014, Saleh stated online, “I’m ready to die for the Caliphate, prison is nothing.” On Aug. 28, 2014, Saleh stated online, “Lets be clear the Muslims in the khilafah [caliphate] need help, the one who is capable to go over and help the Muslims must go and help.” That same day, Saleh made an airline reservation to travel from New York to Turkey, but was ultimately prevented from traveling because his parents took away his passport.
“Saleh made numerous attempts to travel overseas to join ISIS, and when those efforts failed, attempted to assist others in joining the terrorist organization,” said Assistant Attorney General Matthew G. Olsen for the Justice Department’s National Security Division. “Once arrested and detained, he attacked a correctional officer with an improvised weapon. With the sentences handed down today, he is being held accountable for these crimes. The National Security Division is committed to identifying and holding accountable those who seek to provide material support to foreign terrorist organizations and we will be unyielding in our efforts to bring to justice those who commit violence against the men and women in law enforcement and corrections. I want to thank the agents, analysts and prosecutors who are responsible for this case.”
“Today’s sentence demonstrates the strong commitment of this office and its law enforcement partners to rooting out and stopping their efforts to support terrorist attacks at home or abroad,” said U.S. Attorney Breon Peace for the Eastern District of New York. “Saleh is also held accountable for his vicious and premeditated attack on a federal correctional officer while in pre-trial detention.”
“Ali Saleh’s attempts to support ISIS, and his subsequent attack on a federal correctional officer, resulted in the penalties enforced upon him today,” said Assistant Director in Charge Michael J. Driscoll of the FBI’s New York Field Office. “The FBI’s JTTF in New York, along with our partners, continues to lead the way in preventing and intercepting threats posed by those like Saleh, who seek to harm our citizens at home and overseas.”
Saleh then redirected his efforts to facilitating others’ support of ISIS. In October 2014, Saleh communicated with an ISIS supporter in Mali through an online messaging platform and sent a $500 wire transfer to fund that person’s travel to Syria. Around the same time, Saleh communicated with several others to facilitate their support of ISIS, including known ISIS supporters in the United Kingdom and Australia.
In July 2015, the defendant purchased fireworks containing explosive powder, hid them in a concealed compartment in the trunk of his car, and drove from Indiana towards New York City. The fireworks contained approximately 1,196 grams of low explosive powder, consisting of both pyrotechnic material and black powder. Law enforcement agents located a cellphone belonging to Saleh during the time frame when he acquired the explosive powder and discovered on the phone an electronic pamphlet titled, “Muslim Gangs: The Future of Muslims in the West (Ebook 1: How to Survive in the West).” The pamphlet provided detailed instructions on how to create a bomb using explosive powder from fireworks. The pamphlet provided an example of a soda can grenade, and the instructions specifically stated that the soda can should be filled with “[e]xplosive powder (i.e. from Fireworks).” Saleh posted online the pamphlet’s image of a soda can hand grenade with instructions on how to build an improvised explosive device. Saleh’s car broke down on the way to New York City and was abandoned by the defendant.
Subsequently, on July 24, 2015, the defendant made a reservation to travel from New York to Egypt, a country bordering Libya, and went to JFK International Airport. The defendant was ultimately denied boarding. The defendant subsequently visited three additional international airports in Newark, Philadelphia and Indianapolis, but continued to encounter travel restrictions. The defendant attempted to circumvent the apparent restrictions on his air travel by planning to take a train from Cleveland to Canada, where he intended to fly out to the Middle East. After law enforcement intervention, however, the defendant did not board the train and instead returned to New York.
After his encounters with law enforcement, Saleh changed his online social media moniker and expressed his support for ISIS under new usernames. On Aug. 24, 2015, Saleh stated online, “I am a terrorist.” On Sept. 1, 2015, Saleh stated online, “If they aren’t implementing shariah [Islamic law] grab ur gun and implement shariah and see how fast the world turns against u.”
In September 2015, Saleh was arrested at his home on charges of attempting to provide material support to ISIS. During a search of the home, agents recovered paper copies of an itinerary and Turkish visa issued in Saleh’s name for his September 2014 attempt to travel, and a duffel bag containing flashlights, headlamps and other survival gear. Agents also recovered a black trunk containing 29 machetes. Saleh was subsequently detained at the MDC.
During his detention at the MDC, Saleh assaulted numerous federal correctional officers and staff members, crafted weapons from materials in prison, broke cell windows and light fixtures, damaged property, initiated false emergency alarms, and set fires. In total, he was cited on more than 90 separate occasions for disciplinary infractions at the MDC.
On July 13, 2018, at approximately 12:35 p.m., while a senior correctional officer was retrieving trash through an access slot of Saleh’s cell, Saleh reached through the slot and slashed the officer with an improvised knife, seriously lacerating the officer’s right forearm. Saleh smiled at the officer and said, “I hope you die.” The correctional officer subsequently underwent surgery for his wound. Saleh pleaded guilty to assaulting a federal correctional officer and possessing contraband in June 2019.
Assistant U.S. Attorneys Saritha Komatireddy, Margaret E. Lee and Alexander F. Mindlin for the Eastern District of New York and Trial Attorney Katie Sweeten of the National Security Division’s Counterterrorism Section are prosecuting the terrorism case. Assistant U.S. Attorney Douglas M. Pravda is prosecuting Saleh’s assault and contraband case.
The FBI’s New York Field Office investigated the case.
Defendant Sentenced to 96 Months in Prison for Arson Committed to Threaten Victim in “R. Kelly” CaseRead the Press Release
Earlier today, at the federal courthouse in Brooklyn, Michael Williams was sentenced by United States District Judge Ann M. Donnelly to 96 months’ imprisonment for setting fire to a vehicle at the home of a victim-witness who was expected to testify at trial in United States v. Robert Sylvester Kelly, also known as “R. Kelly,” a case pending in the Eastern District of New York (“the Kelly case”). Williams set the car on fire in order to intimidate the victim-witness and prevent her from cooperating with the government’s investigation in the case. The amount of restitution will be determined by the Court at a later date.
Breon Peace, United States Attorney for the Eastern District of New York, Ricky J. Patel, Acting Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), and Dermot F. Shea, Commissioner, New York City Police Department (NYPD), announced the sentence.
“In a violent act designed to instill fear and stop a witness from testifying at trial, Williams set fire to the victim’s vehicle in the middle of the night while it was parked outside of a residence occupied by four adults and two children. Intimidating witnesses and threatening the safety of crime victims undermine the very fabric of our judicial system and will never be tolerated,” stated United States Attorney Peace. “This Office will bring all of its resources to bear against those who commit dangerous acts of violence to silence victims and interfere with the administration of justice.” Mr. Peace expressed his appreciation to the HSI Field Offices in Fort Lauderdale and Tampa, Florida; the Bureau of Alcohol, Tobacco, Firearms and Explosives Field Offices in Savannah, Georgia, and Tampa, Florida; the Florida Bureau of Fire, Arson & Explosives Investigations; the Broward County Sheriff’s Office, Florida; the Lowndes County Sheriff’s Office, Florida; the Polk County Sheriff’s Office, Florida and the Valdosta Police Department, Georgia, for their assistance in this case.
“Williams attempted to use violence and intimidation to divert the course of justice and prevent a victim’s voice from being heard. HSI continues to stand alongside our partners to maintain the integrity of the judicial process and support the brave individuals who come forward to testify in criminal proceedings,” stated HSI Acting Special Agent-in-Charge Patel.
On June 11, 2020, Williams poured gasoline around an SUV parked outside of a residence in Florida where a victim-witness in the Kelly case was staying and set fire to the vehicle. At the time the arson was committed, there were four adults, including the victim-witness in the Kelly case, and two children inside the home. Williams committed the arson to prevent the victim-witness from continuing to cooperate in the Kelly case. The victim-witness’s mother called 911 and told the 911 operator that her grandchildren, whose cries can be heard in the background of the call, were in the home and they were unsure if it was safe to remain in the house given the fire risk outside. The vehicle, leased by the victim’s father, was heavily damaged. Fire investigators also detected an accelerant along the outside perimeter of the residence. Williams had previously made internet searches about the detonation properties of fertilizer and diesel fuel, witness intimidation and witness tampering, and countries that do not have extradition agreements with the United States.
The government’s case is being handled by the Office’s Civil Rights Section. Assistant United States Attorneys Maria Cruz Melendez, Elizabeth Geddes and Nadia Shihata are in charge of the prosecution.
The Defendant:
MICHAEL WILLIAMS
Age: 38
Valdosta, GeorgiaE.D.N.Y. Docket No. 20-CR-395 (AMD)
Panamanian Intermediary in Alleged Bribery Scheme Charged with Money Laundering Extradited to the United States from GuatemalaRead the Press Release
Luis Enrique Martinelli Linares (Luis Martinelli Linares), 39, a citizen of Panama and Italy, was extradited from Guatemala to the United States today to face an indictment filed in federal court in Brooklyn charging him and his brother, Ricardo Alberto Martinelli Linares (Ricardo Martinelli Linares), 42, a citizen of Panama and Italy, with money laundering offenses in connection with a massive bribery and money laundering scheme involving Odebrecht S.A. (Odebrecht), a Brazil-based global construction conglomerate. He is scheduled to make his initial appearance tomorrow before U.S. Magistrate Judge Marcia M. Henry of the U.S. District Court for the Eastern District of New York.
According to court filings, the scheme involved the payment of more than $700 million in bribes to government officials, public servants, political parties, and others in Panama and other countries around the world to obtain and retain business for the company. On Dec. 21, 2016, Odebrecht pleaded guilty in the Eastern District of New York to a criminal information charging it with conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act (FCPA) for its involvement in the bribery and money laundering scheme.
“The successful extradition of Luis Martinelli Linares demonstrates the department’s commitment to work with our international partners to pursue, capture and extradite those who use the U.S. financial system to further their corrupt schemes and launder illicit funds,” said Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division. “Thanks to the efforts of our law enforcement partners in Guatemala, Luis Martinelli Linares will be held accountable in the United States for his alleged crimes.”
“The extradition of Luis Martinelli Linares to the Eastern District of New York is a significant first step in holding him accountable for allegedly laundering millions of dollars in bribe payments through bank accounts in New York and elsewhere,” stated U.S. Attorney Breon Peace for the Eastern District of New York. “Combatting bribery and money laundering by extraditing and prosecuting corrupt foreign actors like Martinelli is a priority of the Department of Justice.”
“Anyone who facilitates bribe payments to government officials contributes to national security risks, whether overtly or inadvertently, and interrupts the free market system of international trade,” said FBI Assistant Director in Charge Michael J. Driscoll. “The FBI will use all available resources to put an end to this type of corrupt behavior.”
Luis Martinelli Linares and Ricardo Martinelli Linares are alleged in the indictment and other court filings to have conspired with others to launder approximately $28 million in bribe payments made by and at the direction of Odebrecht to a then high-ranking government official in Panama (Panama Government Official), who was a close relative of the defendants. The defendants were initially charged by criminal complaint on June 27, 2020. The defendants were arrested at el Aeropuerto Internacional la Aurora in Guatemala on July 6, 2020, pursuant to a provisional arrest request from the United States as they were attempting to depart Guatemala on a private plane. On Feb. 4, 2021, Luis Martinelli Linares and Ricardo Martinelli Linares were charged in a five-count indictment. The indictment charged both defendants with one count of conspiracy to commit money laundering and two counts of concealment money laundering; Luis Martinelli Linares was also charged with two counts of engaging in transactions in criminally derived property.
On May 17, 2021, after several preliminary appeals were dismissed, the Guatemalan Fifth Criminal Sentencing Court granted the request by the United States to extradite Luis Martinelli Linares. On June 21, the Guatemalan Court of Appeals, Criminal Branch affirmed the ruling of the Guatemalan criminal court granting extradition. On Oct. 15, the Guatemalan Ministry of Foreign Affairs notified the United States, via diplomatic note, that the extradition was final and Luis Martinelli Linares was ready for surrender to the United States, resulting in his arrival in the United States on Nov. 15. The United States continues its efforts to have Ricardo Martinelli Linares returned to the United States to face justice.
The Department of Justice commended and thanked the Government of Guatemala for its assistance in the extradition of Luis Martinelli Linares to the United States. The Justice Department’s Office of International Affairs provided substantial assistance in securing the arrest and extradition of Luis Martinelli Linares. The Brazilian Ministerio Publico Federal, Departamento de Polícia Federal, law enforcement authorities in Guatemala including the Public Ministry of Guatemala and Specialized Unit for International Affairs, and law enforcement authorities in El Salvador also provided significant cooperation.
The FBI’s International Corruption Unit in New York is investigating this case, and the NY-ICS, New York SWAT and FBI’s International Operations Division conducted the transport of Luis Martinelli Linares from Guatemala to the United States.
Trial Attorney Michael Culhane Harper of the Criminal Division’s Fraud Section, Trial Attorneys Barbara Levy and Michael Redmann of the Criminal Division’s Money Laundering and Asset Recovery Section (MLARS), and Assistant U.S. Attorney Alixandra E. Smith of the U.S. Attorney’s Office for the Eastern District of New York are prosecuting the case.
The Fraud Section is responsible for investigating and prosecuting all FCPA matters. Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.
The Kleptocracy Asset Recovery Initiative in MLARS was formed to prosecute money launderers and forfeit the proceeds of foreign official corruption and, where appropriate, to use those recovered asset to benefit the people harmed by the corruption and abuse of office. Individuals with information about possible proceeds of foreign corruption located in or laundered through the United States should contact federal law enforcement or send an email to [email protected].
An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Panamanian Intermediary Charged with Money Laundering Extradited to the United States from GuatemalaRead the Press Release
BROOKLYN, NY – Luis Enrique Martinelli Linares (Luis Martinelli Linares) was extradited from Guatemala to the United States today on an indictment filed in federal court in Brooklyn charging him and his brother, Ricardo Alberto Martinelli Linares (Ricardo Martinelli Linares), with money laundering offenses for their roles in a bribery and money laundering scheme involving Odebrecht S.A. (Odebrecht), a Brazil-based global construction conglomerate. Luis Martinelli Linares is scheduled to be arraigned tomorrow before United States Magistrate Judge Marcia M. Henry.
Breon Peace, United States Attorney for the Eastern District of New York, Kenneth A. Polite Jr., Assistant Attorney General of the Justice Department’s Criminal Division, and Michael J. Driscoll, Assistant Director-in-Charge of the Federal Bureau of Investigation, New York Field Office (FBI), announced the extradition.
“The extradition of Luis Martinelli Linares to the Eastern District of New York is a significant first step in holding him accountable for allegedly laundering millions of dollars in bribe payments through bank accounts in New York and elsewhere,” stated United States Attorney Peace. “Combatting bribery and money laundering by extraditing and prosecuting corrupt foreign actors like Martinelli is a priority of the Department of Justice.”
“The successful extradition of Luis Martinelli Linares demonstrates the department’s commitment to work with our international partners to pursue, capture and extradite those who use the U.S. financial system to further their corrupt schemes and launder illicit funds,” stated AAG Polite. “Thanks to the efforts of our law enforcement partners in Guatemala, Luis Martinelli Linares will be held accountable in the United States for his alleged crimes.”
“Anyone who facilitates bribe payments to government officials contributes to national security risks, whether overtly or inadvertently, and interrupts the free market system of international trade," stated FBI Assistant Director-in-Charge Driscoll. “The FBI will use all available resources to put an end to this type of corrupt behavior.”
On December 21, 2016, Odebrecht pleaded guilty in the Eastern District of New York to a criminal information charging it with conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act for its involvement in the bribery and money laundering scheme.
The overarching Odebrecht scheme involved the payment of more than $700 million in bribes to government officials, public servants, political parties, and others in Panama and other countries around the world to obtain and retain business for the company. Luis Martinelli Linares and Ricardo Martinelli Linares allegedly conspired with others to launder approximately $28 million in bribe payments made by and at the direction of Odebrecht to a then high-ranking government official in Panama (Panama Government Official), who was a close relative of the defendants.
The defendants were initially charged by criminal complaint on June 27, 2020. Pursuant to a provisional arrest request from the United States, they were arrested at el Aeropuerto Internacional la Aurora in Guatemala on July 6, 2020, as they were attempting to depart Guatemala on a private plane. On February 4, 2021, Luis Martinelli Linares and Ricardo Martinelli Linares were charged in a five-count indictment, which charged both defendants with one count of conspiracy to commit money laundering and two counts of concealment money laundering; Luis Martinelli Linares was also charged with two counts of engaging in transactions in criminally derived property.
On May 17, 2021, after several preliminary appeals were dismissed, the Guatemalan Fifth Criminal Sentencing Court granted the request by the United States to extradite Luis Martinelli Linares. On June 21, 2021, the Guatemalan Court of Appeals, Criminal Branch affirmed the ruling of the Guatemalan criminal court granting extradition. On October 15, 2021, the Guatemalan Ministry of Foreign Affairs notified the United States, via diplomatic note, that the extradition was final and Luis Martinelli Linares was ready for surrender to the United States, resulting in his arrival in the United States earlier today. The United States has also requested to extradite Ricardo Martinelli Linares, and those proceedings are ongoing.
The charges in the indictment are allegations, and the defendants are presumed innocent unless and until proven guilty.
United States Attorney Peace and Assistant Attorney General Polite thanked the Government of Guatemala for its assistance in the extradition of Luis Martinelli Linares to the United States. The Department of Justice’s Office of International Affairs provided substantial assistance in securing the arrest of Luis Martinelli Linares. The FBI’s International Corruption Squad in New York (ICS-NY) is investigating this case, and the NY-ICS, New York SWAT and FBI’s International Operations Division conducted the transport of Luis Martinelli Linares from Guatemala to the United States."
The case is being prosecuted by Assistant United States Attorney Alixandra Smith of the Office’s Business and Securities Fraud Section, Trial Attorney Michael Culhane Harper of the Criminal Division’s Fraud Section, and Trial Attorneys Barbara Levy and Michael Redmann of the Criminal Division’s Money Laundering and Asset Recovery Section.
The Brazilian Ministerio Publico Federal, Departamento de Polícia Federal, law enforcement authorities in Guatemala including the Public Ministry of Guatemala and Specialized Unit for International Affairs, and law enforcement authorities in El Salvador provided significant cooperation.
The Defendants:
LUIS ENRIQUE MARTINELLI LINARES
Age: 39
Panama City, PanamaRICARDO ALBERTO MARTINELLI LINARES
Age: 42
Panama City, PanamaE.D.N.Y. Docket No. 21-CR-65 (RJD)
Narcotics Trafficker Extradited from Colombia to Face International Cocaine Distribution ChargesRead the Press Release
Fabian Emilio Zapata Taborda, also known as “Milo” and “Milito,” was arraigned today before United States District Judge Kiyo A. Matsumoto at the federal courthouse in Brooklyn on an indictment charging him with leading an international cocaine distribution conspiracy. The defendant, a Colombian citizen, was arrested in Colombia on a provisional arrest warrant issued from the Eastern District of New York and subsequently extradited from Colombia to the United States on November 12, 2021. Zapata Taborda was ordered detained pending trial. The defendant has been designated a Consolidated Priority Organization Target (“CPOT”) by the Department of Justice, a designation given to the most significant narcotics traffickers in the world.
Breon Peace, United States Attorney for the Eastern District of New York, Ray Donovan, Special Agent-in-Charge, Drug Enforcement Administration, New York Division (DEA), Dermot F. Shea, Commissioner, New York City Police Department (NYPD), and Kevin P. Bruen, Superintendent, New York State Police (NYSP), announced the extradition and arraignment.
“As alleged in the indictment, the defendant was the leader of one of Colombia’s largest drug trafficking enterprises that supplied massive, metric ton quantities of cocaine to some of the most violent drug trafficking organizations in the United States, the Caribbean, Central America, and Europe,” stated United States Attorney Peace. “The Department of Justice is committed to working with our international partners to dismantle destructive networks of drug trafficking organizations that seek to spread dangerous and addictive narcotics throughout the world.” Mr. Peace extended his appreciation to the DEA’s office in Bogota, Colombia, the United States Marshals Service, the United States Department of State, the Department of Justice’s Office of International Affairs, the Colombian National Police, and the Government of Colombia.
“After years of supplying multi-ton quantities of cocaine to American criminal organizations, Zapata Taborda is finally facing justice at the hands of the U.S. government,” stated DEA Special Agent-in-Charge Donovan. “This significant arrest and extradition shows DEA's commitment to save lives and bring criminals to justice in collaboration with our law enforcement partners.”
“The waves of internationally trafficked narcotics alleged in this case, which to our hardworking NYPD officers represent countless lives harmed and threatened across our city, are ended with this extradition and indictment. I commend our investigators, our law enforcement partners and the prosecutors in the United States Attorney’s Office for the Eastern District of New York, for their work in this case and for their continuing promise to fight this illegal scourge with every tool at our disposal,” stated NYPD Commissioner Shea.
“I commend the dedicated teamwork of our federal, state and local partners, which was instrumental in this case and bringing a dangerous drug trafficker to justice. By working together, we are preventing these dangerous narcotics from coming into our communities and removing the violent criminals who profit at the expense of the people we serve. We will continue to be vigilant to keep these harmful narcotics off our streets and our neighborhoods safe,” stated NYSP Superintendent Bruen.
According to the indictment, court filings, and statements made in Court, the defendant supplied metric tons of cocaine to numerous drug trafficking organizations in Colombia, for distribution to locations in the Caribbean, Central America, Europe, and the United States. As part of the investigation, law enforcement authorities seized over 1.9 metric tons of cocaine attributable to Zapata Taborda’s drug trafficking enterprise. The seizures included multi-hundred-kilogram shipments of cocaine sent by the Zapata Taborda drug trafficking organization from Colombia to Jamaica and Costa Rica for ultimate importation to the United States. Among the drug trafficking organizations supplied by the defendant was Clan del Golfo which is one of the most prolific and violent in the world. Colombian law enforcement authorities also seized and destroyed a large-scale cocaine laboratory operated by the Zapata Taborda drug trafficking organization in Antioquia, Colombia.
The extradition of Zapata Taborda is the result of an ongoing Organized Crime Drug Enforcement Task Forces (OCDETF) investigation led by the United States Attorney’s Office for the Eastern District of New York and the DEA. The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking, weapons trafficking, and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply. OCDETF uses a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
The charges in the indictment are allegations, and the defendant is presumed innocent unless and until proven guilty. If convicted, the defendant faces up to life in prison.
The government’s case is being handled by the Office’s International Narcotics and Money Laundering Section. Assistant United States Attorneys Francisco J. Navarro and Margaret Schierberl are in charge of the prosecution. The Justice Department’s Office of International Affairs handled the extradition in this matter.
The Defendant:
FABIAN EMILIO ZAPATA TABORDA
Age: 52
Antioquia, ColombiaE.D.N.Y. Docket No. 19-CR-212 (KAM)
Intermediario panameño en supuesto plan de soborno acusado de lavado de dinero fue extraditado a los Estados Unidos desde GuatemalaRead the Press Release
WASHINGTON – Luis Enrique Martinelli Linares (Luis Martinelli Linares), de 39 años, ciudadano de Panamá e Italia, fue extraditado hoy desde Guatemala hacia los Estados Unidos para enfrentar una acusación presentada ante un tribunal federal en Brooklyn acusándolo a él y a su hermano, Ricardo Alberto Martinelli Linares (Ricardo Martinelli Linares), 42, ciudadano de Panamá e Italia, con delitos de lavado de dinero en relación con un plan masivo de soborno y lavado de dinero en el que involucra a Odebrecht S.A. (Odebrecht), un conglomerado mundial de construcción con sede en Brasil. Él está programado para comparecer por primera vez mañana ante la Magistrada de los Estados Unidos, Marcia M. Henry, del Tribunal de Distrito de los Estados Unidos para el Distrito Este de Nueva York.
Según los expedientes judiciales, el plan implicaba el pago de más de $700 millones en sobornos a funcionarios de gobierno, funcionarios públicos, partidos políticos y otros en Panamá y otros países alrededor del mundo para obtener y retener negocios para la compañía. El 21 de diciembre de 2016, Odebrecht se declaró culpable en el Distrito Este de Nueva York de una acusación criminal de conspiración para violar las disposiciones contra el soborno de la Ley de Prácticas Corruptas Extranjeras (FCPA), por su participación en el plan de soborno y lavado de dinero.
“La exitosa extradición de Luis Martinelli Linares demuestra el compromiso del departamento de trabajar con nuestros socios internacionales para perseguir, capturar y extraditar a quienes usan el sistema financiero de Estados Unidos para promover sus esquemas de corrupción y lavar fondos ilícitos,” dijo el fiscal general adjunto Kenneth A. Polite Jr. de la División Criminal del Departamento de Justicia. “Gracias a los esfuerzos nuestros socios en la aplicación de la ley en Guatemala, Luis Martinelli Linares deberá rendir cuentas en los Estados Unidos por sus presuntos delitos.”
“La extradición de Luis Martinelli Linares al Distrito Este de Nueva York es un primer paso significativo para que rinda cuentas por supuestamente haber lavado millones de dólares en pagos de sobornos a través de cuentas bancarias en Nueva York y otros lugares,” declaró el fiscal para el Distrito Este de Nueva York, Breon Peace. “Combatir el soborno y el lavado de dinero extraditando y enjuiciando a actores extranjeros corruptos como Martinelli es una prioridad del Departamento de Justicia.”
“Cualquier persona que facilite los pagos de sobornos a funcionarios gubernamentales contribuye a los riesgos de seguridad nacional, ya sea de manera abierta o involuntariamente, e interrumpe el sistema de libre mercado del comercio internacional,” dijo Michael J. Driscoll, director adjunto a cargo del FBI. “El FBI utilizará todos los recursos disponibles para poner fin a este tipo de comportamiento corrupto.”
Luis Martinelli Linares y Ricardo Martinelli Linares se presume en la acusación y otras presentaciones judiciales que conspiraron con otros para lavar aproximadamente $28 millones en pagos de sobornos hechos por y bajo la dirección de Odebrecht a un funcionario de alto rango en ese entonces del gobierno de Panamá, que era un pariente cercano de los acusados. Los sindicados fueron inicialmente acusados el 27 de junio de 2020 por medio de una denuncia penal. Los acusados fueron detenidos en el Aeropuerto Internacional la Aurora en Guatemala el 6 de julio de 2020, en cumplimiento de una solicitud de arresto provisional de los Estados Unidos cuando intentaban salir de Guatemala en un avión privado. El 4 de febrero de 2021, Luis Martinelli Linares y Ricardo Martinelli Linares fueron acusados formalmente con cinco cargos. La denuncia acusó a ambos sindicados de un cargo de conspiración para cometer lavado de dinero y dos cargos de encubrimiento de lavado de dinero; Luis Martinelli Linares también fue acusado de dos cargos de participación en transacciones de propiedad obtenida ilícitamente.
El 17 de mayo de 2021, después de la desestimación de varios recursos preliminares, el Tribunal Quinto de Sentencia Penal de Guatemala otorgó la solicitud de Estados Unidos de extraditar a Luis Martinelli Linares. El 21 de junio, la Sala de la Corte de Apelaciones Ramo Penal de Guatemala, confirmó el fallo del tribunal penal guatemalteco que concedía la extradición. El 15 de octubre, el Ministerio de Relaciones Exteriores de Guatemala notificó a los Estados Unidos, mediante una nota diplomática, que la extradición era definitiva y Luis Martinelli Linares estaba listo para ser entregado a los Estados Unidos, dando lugar a su llegada a los Estados Unidos el 15 de noviembre. Los Estados Unidos continúa sus esfuerzos para que Ricardo Martinelli Linares regrese a los Estados Unidos para enfrentar la justicia.
El Departamento de Justicia elogió y agradeció al Gobierno de Guatemala su asistencia en la extradición de Luis Martinelli Linares a los Estados Unidos. La Oficina de Asuntos Internacionales del Departamento de Justicia prestó asistencia considerable para asegurar la detención y extradición de Luis Martinelli Linares. El Ministerio Público Federal de Brasil, el Departamento de Policía Federal, las autoridades encargadas de aplicación de la ley en Guatemala, incluyendo al Ministerio Público de Guatemala y la Unidad Especializada de Asuntos Internacionales, y las autoridades del orden público en El Salvador también proporcionaron una importante cooperación.
La Unidad Contra la Corrupción Internacional del FBI en Nueva York está investigando este caso y la División de Operaciones Internacionales del FBI, el NY-ICS, y el SWAT de Nueva York transportaron a Luis Martinelli Linares desde Guatemala a los Estados Unidos.
El abogado litigante Michael Culhane Harper de la Sección de Fraude de la División Criminal, los abogados litigantes Barbara Levy y Michael Redmann de la Sección de Lavado de Dinero y Recuperación de Activos de la División Criminal (MLARS), y la Fiscal Federal Auxiliar Alixandra E. Smith, de la Fiscalía Federal para el Distrito Este de Nueva York están procesando el caso.
La Sección de Fraude es responsable de investigar y procesar todos los asuntos de la Ley de Prácticas Corruptas en el Extranjero (FCPA). Puede encontrar información adicional sobre los esfuerzos del Departamento de Justicia para hacer cumplir la FCPA en www.justice.gov/criminal/fraud/fcpa.
La Iniciativa de Recuperación de Activos de la Cleptocracia en MLARS fue creada para procesar a las personas que lavan dinero y confiscar el producto de la corrupción de funcionarios extranjeros y, cuando es apropiado, utilizar esos activos recuperados para beneficiar a las personas perjudicadas por la corrupción y el abuso de poder. Las personas que tienen información sobre posibles ingresos de corrupción extranjera ubicadas en o lavadas a través de los Estados Unidos deben contactar a la policía federal o enviar un correo electrónico a [email protected].
Una imputación es simplemente una acusación, y todos los acusados se presumen inocentes hasta que se demuestre su culpabilidad más allá de una duda razonable en un tribunal de justicia.
Long Island Doctor Pleads Guilty to Covid-19 Loan FraudRead the Press Release
Earlier today, at the federal courthouse in Central Islip, Konstantino Zarkadas, a Glen Cove-based medical doctor, pleaded guilty to disaster relief fraud and wire fraud in connection with his receipt of millions of dollars in small business loans under the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan Program (EIDLP). Today’s proceeding was held before United States District Judge Gary R. Brown. When sentenced, Zarkadas faces up to 30 years in prison, as well as forfeiture of $3,796,849.50 and a fine of up to $250,000.
Breon Peace, United States Attorney for the Eastern District of New York, Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Thomas Fattorusso, Special Agent-in-Charge, Internal Revenue Service-Criminal Investigation, New York (IRS-CI), announced the guilty plea.
“The defendant, a medical professional, admits to diverting millions of dollars in COVID-19 disaster relief funds to finance an extravagant lifestyle, including the purchase of luxury watches and vehicles, and the down payment on a yacht,” stated United States Attorney Peace. “This Office will vigorously prosecute those who steal from government programs that are designed to help struggling small businesses and families stay afloat during the pandemic.”
“It’s always a shame to see the rampant abuse of programs designed to help ordinary people struggling through the pandemic. Dr. Zarkadas chose greed over honesty by financing a luxury lifestyle on the backs of America’s taxpayers. This case, along with many others, demonstrate IRS-CI is constantly working to weed out financial fraud wherever it may be found. IRS-CI would like to thank the FBI and the U.S. Attorney’s Office for the Eastern District of New York for their partnership and investigative efforts on this case,” stated IRS-CI Special Agent-in-Charge Fattorusso.
As set forth in court filings, between March 2020 and July 2020, amid the COVID-19 pandemic, Dr. Zarkadas fraudulently applied for, and received, at least 11 PPP and EIDLP loans totaling approximately $3.7 million, on behalf of corporate entities he controlled. Zarkadas laundered the loan proceeds through various bank accounts he controlled, ultimately using the funds for extravagant personal purchases and other impermissible purposes. For example, in July 2020, Zarkadas used approximately $194,915.42 in PPP funds intended for distressed small businesses affected by the pandemic to finance the down payment on a $1.75 million yacht. To conceal the fraudulent nature of the purchase, Zarkadas made the check payable to a family member who was not the ultimate beneficiary of the funds and, in the check’s memo line, falsely indicated that the funds were “repayment for payroll.” Zarkadas also withdrew tens of thousands of dollars’ worth of loan proceeds in cash and used some of the proceeds to satisfy more than $1 million in judgments against him, to lease luxury vehicles, and to make personal purchases, including several Rolex and Cartier wristwatches which he has agreed to forfeit in today’s proceeding.
Congress created the PPP and EIDLP as part of the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act. Enacted on March 29, 2020, the CARES Act provided emergency financial assistance in connection with economic effects of the COVID-19 pandemic. One source of relief provided by the CARES Act was the allocation of funds for the issuance of forgivable loans to small businesses for job retention and certain other expenses through the PPP. The PPP allowed qualifying small businesses to receive unsecured loans on favorable terms, which they were required to use for specified expenses, including payroll costs, interest on mortgages, rent and utilities. The PPP provided for forgiveness of the loan if the recipient businesses spent the proceeds on these specified expenses within a limited time period and used a certain percentage for payroll costs.
Another source of relief provided by the CARES Act was the EIDLP, which provided low-interest financing to small businesses, renters, and homeowners in regions affected by declared disasters. Under the program, EIDLP recipients were eligible to receive advances of up to $10,000 for small businesses within three days of applying for an EIDL (EIDL Advance). The amount of an EIDL Advance was determined based on the number of employees working for the applicant. The EIDL Advance did not have to be repaid.
The government’s case is being handled by the Office’s Long Island Criminal Division. Assistant United States Attorney Anthony Bagnuola is in charge of the prosecution.
The Defendant:
KONSTANTINO ZARKADAS
Age: 48
Glen Cove, New YorkE.D.N.Y. Docket No. 21-CR-363 (GRB)
Russian Cybercriminal Sentenced to 10 Years in Prison for Digital Advertising Fraud SchemeRead the Press Release
Earlier today, at the federal courthouse in Brooklyn, Aleksandr Zhukov was sentenced by United States District Judge Eric R. Komitee to 10 years’ imprisonment for perpetrating a digital advertising fraud scheme through which the defendant and his co-conspirators stole more than $7 million from U.S. advertisers, publishers, platforms, and others in the U.S. digital advertising industry. The Court also ordered Zhukov to pay $3,827,493 in forfeiture. Zhukov, a Russian national who was arrested in Bulgaria in 2018, was extradited to the United States in 2019, and was convicted following a jury trial in May 2021 of wire fraud conspiracy, wire fraud, money laundering conspiracy, and money laundering.
Breon Peace, United States Attorney for the Eastern District of New York, Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Dermot F. Shea, Commissioner, New York City Police Department (NYPD), announced the sentence.
“Sitting at his computer keyboard in Bulgaria and Russia, Zhukov boldly devised and carried out an elaborate multi-million-dollar fraud against the digital advertising industry, and victimized thousands of companies across the United States,” stated United States Attorney Peace. “Today’s sentence holds the defendant accountable for his deception and outright theft of more than $7 million, and sends a powerful message to cyber criminals around the world that there is no escape from the international reach of law enforcement.”
Between September 2014 and December 2016, Zhukov operated a purported advertising network—Media Methane—and carried out a digital advertising fraud scheme that came to be known as “Methbot.” Media Methane had business arrangements with other advertising networks whereby it received payment in return for placing advertisements—primarily video advertisements—on websites. Rather than place advertisements on real publishers’ webpages where human internet users would see them, Zhukov rented more than 2,000 computer servers housed in commercial datacenters in Dallas, Texas, Amsterdam and the Netherlands, and programmed the datacenter computer servers (the “bots”) to simulate humans viewing ads on webpages. Zhukov and his co-conspirators programmed the bots to load real ads on blank webpages while falsely representing that the ads were loading on real webpages, “spoofing” the domains of more than 6,000 publishers, including The New York Times, the New York Post, the New York Daily News, Newsday, and the Staten Island Advance.
To create the illusion that human internet users were viewing the advertisements loaded onto these spoofed webpages, Zhukov and his co-conspirators programmed the bots to appear and behave like human internet users: falsely representing that they had screens and mouses, that they were running operating systems used for personal computers, and that they were running commercially available internet browsers (like Chrome, Internet Explorer, and Firefox), when they were not. Zhukov and his co-conspirators also programmed the bots to click around a screen a randomly determined number of times, simulate a mouse moving around and scrolling down a webpage, start and stop a video player midway, bypass captchas, accept cookies, and falsely appear to be signed into popular social media services such as Facebook, Twitter, and Google.
In addition, the defendant leased more than 765,000 Internet Protocol (“IP”) addresses, assigned multiple IP addresses to each datacenter server, and then fraudulently registered IP addresses in the names of major U.S. internet providers. Zhukov entered the false usage and location information into IP databases that are widely relied upon in the industry to make it appear that the computers in question belonged to human internet users located in homes and businesses around the United States.
Zhukov recruited computer programmers and other employees to help him perpetrate the scheme and build the technical infrastructure required to create fraudulent ad traffic. He referred to these individuals as “my developers,” and referred to himself as the “king of fraud!”
The victim companies collectively paid more than $7 million for ads that were never actually viewed by human internet users and never actually displayed on real webpages.
Zhukov directed and transferred proceeds from the scheme to and through multiple personal and corporate bank accounts in Bulgaria, Russia, the United Kingdom, the Czech Republic, Latvia, and Cyprus. He kept 75% of the scheme’s proceeds for himself and pocketed more than $4.8 million from the fraud.
The government’s case is being handled by the Office’s National Security and Cybercrime Section. Assistant United States Attorneys Saritha Komatireddy, Artie McConnell, and Alexander F. Mindlin are in charge of the prosecution. The Justice Department’s Office of International Affairs, the FBI’s Legal Attachés abroad and foreign authorities in multiple countries provided critical assistance in this case.
The Defendant:
ALEKSANDR ZHUKOV
Age: 41
Russian FederationE.D.N.Y. Docket No. 18-CR-633 (EK)
Queens Man Convicted of Securities and Wire Fraud Conspiracies Relating to the Foreign Exchange MarketRead the Press Release
John Won was convicted by a federal jury in Brooklyn yesterday of all five counts of an indictment charging him with securities fraud, wire fraud and money laundering conspiracies, as well as substantive securities fraud. The verdict followed a week-long trial before United States District Judge Raymond J. Dearie. When sentenced, Won faces a maximum of 20 years in prison.
Breon Peace, United States Attorney for the Eastern District of New York, and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the verdict.
“John Won and his co-conspirators targeted the Korean-American community in our district and cheated them out of hundreds of thousands of their hard-earned dollars through a web of false promises, lies and deceit,” stated United States Attorney Peace. “Today’s verdict demonstrates the resolve of this Office and our law enforcement partners to prosecuting those who engage in fraud and betray the trust of their investors.” Mr. Peace thanked the Commodities and Futures Trading Commission (CFTC) and National Futures Association (NFA) for their significant cooperation and assistance in this case.
As proven at trial, between February 2012 and December 2013, Won conspired with co-defendant Tae Hung Kang and others in a scheme to defraud victims, who were largely members of New York City’s Korean-American community, into investing in foreign exchange trading accounts and in their company, called ForexNPower. The conspirators issued advertisements in Korean-language newspapers and on Korean-language radio stations claiming that ForexNPower had a secret algorithmic trading method used to trade in the foreign exchange market that guaranteed investors 10 percent monthly returns at no risk of loss. In reality, ForexNPower had no successful trading method and all of their customer accounts suffered substantial losses.
The conspirators also induced investors to purchase stock issued by ForexNPower by falsely claiming that the invested funds would be used to expand the business to a new location in New Jersey or pooled and used to trade foreign currencies. In truth, Won and his co-conspirators misappropriated a substantial portion of the funds, spending the remainder on, among other things, the fraudulent advertisements.
In March 2021, co-defendant Tae Hung Kang, also known as “Kevin Kang,” pleaded guilty to conspiracy to commit securities fraud. Kang is awaiting sentencing.
The government’s case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys Sarah M. Evans and Nicholas J. Moscow, and Assistant Chief Gerald M. Moody, Jr. of the Department of Justice’s Fraud Section are in charge of the prosecution.
The Defendants:
JOHN WON
Age: 53
Whitestone, New YorkTAE HUNG KANG (also known as “Kevin Kang”)
Age: 57
Bayside, New YorkE.D.N.Y. Docket No. 18-CR-184 (RJD)
Long Island Bloods Gang Member Convicted of Racketeering and Other Charges, Including Murder, Narcotics Distribution and Sex TraffickingRead the Press Release
Earlier today, following four weeks of trial, a federal jury in Central Islip, New York, returned a guilty verdict against Bloods gang member Lawrence Lewis, also known as “L Boogs,” for the July 29, 2017 murder of John Birt, the forcible rape and sex trafficking of a Suffolk County woman, racketeering, multiple firearms offenses, narcotics possession and distribution and witness tampering. The trial was held before United States District Judge Joanna Seybert. When sentenced, Lewis faces a mandatory penalty of life in prison for the murder.
Breon Peace, United States Attorney for the Eastern District of New York, Timothy D. Sini, District Attorney, Suffolk County District Attorney’s Office, Ricky J. Patel, Acting Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Stuart Cameron, Acting Commissioner, Suffolk County Police Department (SCPD), announced the verdict.
“Lewis’s conviction today ensures that he will never again be able to terrorize our community with his senseless acts of gang-related violence,” stated United States Attorney Peace. “I commend the prosecutors in this Office, the Suffolk County District Attorney’s Office and the special agents and detectives whose hard work and persistence led to Lewis being held accountable for his long record of reprehensible crimes.”
“With extreme violence and indifference to human life, Lawrence Lewis with the Bloods street gang reigned terror over neighborhoods in Suffolk County, Long Island for over a decade. With today’s verdict finding Lewis guilty of heinous crimes to include murder, rape, and sex trafficking, a clear message has been sent to these violent gang members that they will be held accountable for their actions,” stated HSI Acting Special Agent-in-Charge Patel. “HSI New York’s Long Island Transnational Violent Gangs Task Force, working with our law enforcement and prosecutorial partners, will continue to tirelessly pursue the most dangerous offenders and bring them to justice.”
“Today’s verdict shows Mr. Lewis has very little regard for human life and demonstrates how truly detrimental his presence has been to society. He will now face the consequences of his actions. The outstanding work being done by our Long Island Gang Task Force continues to take these violent criminals of our streets and out of our communities so they can longer terrorize our neighbors,” stated FBI Assistant Director-in-Charge Driscoll.
“As a member of a violent street gang, Lewis’ involvement in illegal activity ran the gamut,” stated SCPD Acting Commissioner Cameron. “He was willing to do whatever it took to further his criminal activities and attempt to evade authorities. I applaud the hard work of all the agencies involved to hold Lewis accountable for his heinous actions.”
As proven at trial, between April 2004 and June 2019, Lewis, as a member of the Bloods street gang, distributed large quantities of cocaine base and heroin in Suffolk County. In order to protect his supply of narcotics, and secure his ability to distribute his narcotics, Lewis possessed a number of firearms, including an AR-15 assault rifle, a pistol-grip 12-gauge shotgun, a Mossberg .22 caliber rifle and a Ruger .45 caliber semi-automatic pistol.
Lewis also engaged in acts of extreme violence on behalf of the Bloods gang. For example, in 2014, as retaliation for a theft of guns, Lewis forced a woman into engaging in prostitution until she repaid her debt to him. During the same period of time, Lewis forcibly raped the woman. On July 29, 2017, Lewis shot and killed John Birt, a member of the Crips gang, at the Illusions Gentlemen’s Club in Deer Park, New York. While Birt and several friends posed for pictures inside the club, Lewis and a fellow Bloods gang member approached the group. Lewis’ associate attempted to display a Bloods hand signal and Birt began arguing with Lewis, who then shot and killed him. Later, Lewis texted a number of close acquaintances about the murder, stating that he was “sleeping good” and would “do it again.”
Prior to the trial, Lewis and others acting on his behalf made efforts to prevent witnesses from testifying against him, through the use of veiled and implicit threats of violence.
The government’s case is being handled by the Office’s Long Island Criminal Division. Assistant United States Attorneys Christopher C. Caffarone, Mark E. Misorek and Anthony Bagnuola are in charge of the prosecution.
The Defendant
LAWRENCE LEWIS (also known as “L Boogs”)
Age: 38
Calverton, New YorkE.D.N.Y. Docket No. 18-CR-187 (S-1) (JS)
Long Island Man Sentenced to Life in Prison Plus 84 Years for Murder, Multiple Home Invasion Robberies and Unlawful Use of FirearmsRead the Press Release
Earlier today, in federal court in Central Islip, New York, Tyrone L. Robinson was sentenced by United States District Judge Joan M. Azrack to life imprisonment plus 84 years to run consecutive to the life sentence for murder, seven counts of robbery and attempted robbery of drugs and drug proceeds, seven counts of unlawful use, brandishing and discharge of firearms, and four counts of being a felon in possession of firearms and ammunition. Robinson was convicted by a jury in February 2020 following a four-week trial.
Breon Peace, United States Attorney for the Eastern District of New York, and John B. DeVito, Special Agent-in-Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives, New York Field Division (ATF), announced the sentence.“Robinson’s violent crime spree extended not only to possessing illegal drugs and weapons, and committing home invasions, robberies and murder, but also to threatening to take the life of an innocent 8-year-old child,” stated United States Attorney Peace. “Today’s lengthy sentence serves to protect our communities, including our children, while sending a strong message to violent offenders like the defendant that they will be held accountable to the fullest extent of the law.”
Mr. Peace expressed his appreciation to the Nassau and Suffolk County Police Departments and the New York State Department of Corrections and Community Supervision for their assistance with the investigation and prosecution.
“Today’s sentence ensures that a serial predator will never be set free to inflict violence within our communities. The reign of terror of Tyrone Robinson is over. Convicted of murder with a firearm, armed robbery, armed assaults, Robinson preyed upon his victims and showed no mercy. We commend the work of the ATF’s Long Island Firearms Task Force and our partners from the Nassau and Suffolk County Police Departments and United States Attorney’s Office for their steadfast commitment to investigating these crimes and to ensuring justice was served,” stated ATF Special Agent-in-Charge DeVito.
Between August 2015 and May 2016, Robinson and his co-conspirators committed multiple armed home invasion robberies of drug dealers in Nassau and Suffolk counties. The victims were pistol-whipped, often times zip-tied, threatened with death and shot. On March 25, 2016, Robinson committed an armed home invasion in Lake Grove and threatened to kill an eight-year-old girl if she did not find money for him. The following night, when Robinson returned to the scene of the Lake Grove home invasion, he dropped his cellphone and it was recovered by police responding to a call from neighbors. The cellphone was logged into Robinson’s online account which he had used to Google search for directions to his targeted locations and for news reports about the crimes he had committed. For example, after a violent robbery attack in Hempstead, Robinson Google searched “man beaten in Hempstead.” During a home invasion robbery by Robinson on May 3, 2016 in Freeport, the victim, Johnathan Isaac, was fatally shot in the back. Shortly after Isaac’s murder and the shooting of another victim in Freeport, Robinson Google searched “two shot Freeport” and watched news reports about the crimes.
This case was brought as part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. As part of the program, U.S. Attorneys’ Offices work in partnership with federal, state, local and tribal law enforcement and their local communities to develop effective, locally based strategies to reduce violent crime.
The government’s case is being handled by the Office’s Long Island Criminal Division. Assistant United States Attorneys Allen Bode and Anthony Bagnuola are in charge of the prosecution.
The Defendant:
TYRONE L. ROBINSON
Age: 35
Bay Shore, New YorkE.D.N.Y. Criminal Docket No. 16-545 (S-4)(JMA)
Dark Web Narcotics Trafficker Sentenced to 96 Months in Prison for Distributing Fentanyl, Heroin, Methamphetamine, Cocaine, Oxycodone and MethadoneRead the Press Release
Earlier today, at the federal courthouse in Brooklyn, Joanna De Alba was sentenced by United States District Judge Dora L. Irizarry to 96 months in prison for distributing, and possessing with intent to distribute, illegal drugs over the “dark web.” De Alba distributed an array of illegal drugs—including fentanyl, heroin, MDMA, cocaine, methamphetamine, oxycodone and methadone—over the dark web in exchange for Bitcoin and other cryptocurrency. De Alba pleaded guilty in April 2021.
Breon Peace, United States Attorney for the Eastern District of New York, and Ray Donovan, Special Agent-in-Charge, Drug Enforcement Administration, New York Division (DEA), announced the sentence.
“The prison sentence imposed on De Alba today demonstrates that her clandestine use of the dark web to distribute a potentially lethal array of powerful drugs like fentanyl, heroin and oxycodone in exchange for cryptocurrency was a failure,” stated United States Attorney Peace. “This investigation and vigorous prosecution show that we will not allow the dark web to be a haven for drug traffickers.”
“This sentencing demonstrates that drug traffickers are not untouchable by dealing in the dark web,” stated DEA Special Agent-in-Charge Donovan. “Attempting to hide through anonymity, De Alba became a parent’s worst nightmare by pushing fentanyl, heroin and other dangerous drugs into homes across our many communities. I applaud the Cyber Investigative Unit- New York Division and the U.S. Attorney's Office Eastern District of New York for their commendable work throughout this investigation.”
The internet contains online marketplaces for narcotics and other contraband on the “dark web,” a part of the internet located beyond the reach of traditional internet browsers and accessible only through networks designed to conceal user identities. The “Wall Street Market” was a global dark web marketplace that required its users to trade in digital currencies, primarily Bitcoin.
Between June 2018 and May 2019, De Alba advertised and sold illegal narcotics on the Wall Street Market. These narcotics included opioids—including fentanyl (concealed as oxycodone pills) and heroin—as well as other potent illegal drugs including oxycodone, cocaine, methamphetamine, ecstasy and other substances containing MDMA. De Alba took various measures to operate anonymously and conceal her identity, including using the online alias “RaptureReloaded,” using fake company names and shipping addresses, using the name of her deceased husband to receive packages from her suppliers and using credit cards in her deceased husband’s name to fund the tracking of her shipments. De Alba also directed customers to contact her through encrypted email and messaging services and pay her with cryptocurrency. De Alba offered free shipping to addresses in the United States and free tracking of all orders.
De Alba participated in over 600 transactions on the Wall Street Market in which she sold more than: 840 grams of heroin; 190 grams of methamphetamine; 1,250 pills of MDMA; and 280 pills of oxycodone. De Alba also sold more than 750 fake oxycodone pills—pills that actually contained fentanyl, but were concealed and disguised as oxycodone. De Alba received payment in the cryptocurrencies Bitcoin and Monero, and pocketed approximately 16.32 BTC and 400 XMR, which together are worth more than $1 million today.
The government’s case is being handled by the Office’s International Narcotics and Money Laundering Section. Assistant United States Attorneys Saritha Komatireddy and Francisco J. Navarro are in charge of the prosecution.
The Defendant:
JOANNA DE ALBA (also known as “RaptureReloaded”)
Age: 40
Tijuana, MexicoE.D.N.Y. Docket No. 19-CR-563 (DLI)
Colombian Drug Kingpin and Paramilitary Leader Pleads Guilty to Operating a Continuing Criminal Enterprise and Conspiring to Provide Material Support to a Foreign Terrorist OrganizationRead the Press Release
Earlier today, in federal court in Brooklyn, Daniel Rendon Herrera, also known as “Don Mario,” a citizen of Colombia, pleaded guilty to engaging in a continuing criminal enterprise and conspiring to provide material support to a designated foreign terrorist organization. The proceeding took place before United States District Judge Dora L. Irizarry. When sentenced, Rendon Herrera faces a mandatory minimum sentence of 20 years in prison and up to life imprisonment, as well as forfeiture in excess of $45 million and a fine of up to $2.25 million.
Breon Peace, United States Attorney for the Eastern District of New York; Damian Williams, United States Attorney for the Southern District of New York; Matthew G. Olsen, Assistant Attorney General for the Justice Department’s National Security Division; Ray Donovan, Special Agent-in-Charge, Drug Enforcement Administration, New York Division (DEA); Rick J. Patel, Acting Special Agent-in-Charge, Homeland Security Investigations, New York (HSI); Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); Dermot F. Shea, Commissioner, New York City Police Department (NYPD); and Kevin P. Bruen, Superintendent, New York State Police (NYSP), announced the guilty plea.
“With today’s guilty plea, Rendon Herrera, who was once the most feared narco-terrorist in Colombia, admitted to leading one of the world’s largest and most violent drug cartels and flooding the streets of America with cocaine. Rendon Herrera also admitted to providing material support to a designated terrorist organization that brutally killed, kidnapped, and tortured rival drug traffickers and civilians.” stated United States Attorney Peace. “I commend the determined efforts of countless members of law enforcement, foreign and domestic, who brought the defendant to justice.”
“By his admission, Daniel Rendon Herrera was a leader of a brutal and murderous narco-terrorist organization in Colombia, and he trafficked more than 80 tons of cocaine,” stated United States Attorney Williams. “Rendon Herrera oversaw operations of a paramilitary cartel that carried out kidnappings, torture, and murders. Now, through the combined efforts of law enforcement officers and prosecutors, Rendon Herrera awaits sentencing for his crimes.”
“Don Mario’s guilty plea has left footprints for other drug kingpins to follow,” stated DEA Special Agent-in-Charge Donovan. “This notorious founder and leader of Clan Usaga is facing the consequences of his billion-dollar cocaine empire that spread fear, drug addiction, and death throughout Colombia and the United States. I commend the law enforcement alliance that has worked for years to bring Rendon Herrera to justice.”
“Rendon Herrera, one of Colombia’s most prominent and feared drug kingpins and once the leader of the narco-terrorist Los Urabenos Drug Trafficking Organization, committed heinous crimes in pursuit of power and profit. This plea demonstrates HSI and its law enforcement partners’ commitment to disrupting and dismantling the criminal organizations responsible for the dangerous narcotics flooding our streets. We will continue to pursue these organizations at the highest levels, both at home and abroad, and put an end to the terror that they generate across the world.” stated HSI Acting Special Agent-in-Charge Patel.
“All roads travelled by international drug cartels seem to lead straight to our cities, where their members poison our neighbors and wreak deadly havoc. In this case, Mr. Herrera admits to supporting designated terrorists as they kidnapped, tortured, and murdered people so he could build his power and wealth. Our pursuit of these groups won't wane with his guilty plea today. Even now, we are on to the next leader who most likely believes he won't suffer the same fate,” stated FBI Assistant Director-in-Charge Driscoll.
“Our NYPD investigators work tirelessly to avert narcotics, terrorism and threats from the kind of violent, overseas criminal enterprises that this long term investigation has dismantled. I commend our officers, our law enforcement partners and the prosecutors in the United States Attorney’s Office for the Eastern District of New York for their public service to all New Yorkers in achieving today’s guilty plea,” stated NYPD Commissioner Shea.
According to court filings and facts presented during the plea proceeding, the guilty plea stems from Rendon Herrera’s role, since the late 1990’s, as a leader of the designated foreign terrorist organization, the Autodefensas Unidas de Colombia (AUC), and as founder and leader of Los Urabeños Drug Trafficking Organization (the Urabeños, also referred to as Clan Usuga and Clan del Golfo), effectively the successor organization to the AUC.
The AUC, founded in 1997, was a Colombian paramilitary and drug-trafficking organization, designated in 2001 by the United States Department of State as a Foreign Terrorist Organization and Specially-Designated Global Terrorism Organization. The AUC engaged in armed conflict with the Fuerzas Armadas Revolucionarios de Colombia (FARC), Colombia’s main guerilla group, and sought to remove FARC sympathizers from positions of power and influence in Colombia. To support its political and terrorist objectives, the AUC imposed “taxes” on cocaine trafficked through AUC-controlled areas and engaged in violent attacks including murders and kidnappings. By 2006, many members of the AUC demobilized as part of the Colombian government’s Justice and Peace process – a process under which paramilitary members surrender to the Colombian government and relinquish their criminally-derived assets in exchange for reduced sentences and amnesty from extradition. Rather than submit to the peace process, Rendon Herrera re-mobilized the AUC as the Urabeños.
The Urabeños, like the AUC, continued to finance their paramilitary and drug trafficking by imposing a “tax” on multi-ton shipments of cocaine that transited through areas in Colombia controlled by the organization and were ultimately destined for importation into the United States. The Urabeños employed “sicarios,” or hitmen, who carried out various acts of violence, including murders, assaults, kidnappings and assassinations to collect drug debts, maintain discipline, control and expand drug territory, and to promote and enhance the prestige, reputation, and position of the organization. In 2009, when Rendon Herrera was captured by the Colombian National Police, he commanded 16 “bloques,” or territories, across Colombia and thousands of armed paramilitary fighters.
In connection with his plea, Rendon Herrera accepted responsibility for trafficking at least 73,645 kilograms of cocaine. The charges relating to the AUC were initially filed in the Southern District of New York and transferred to the Eastern District of New York for the consolidated plea. The charges relating to the Urabeños originated in the Eastern District of New York. Additionally, since 2009, Rendon Herrera has been designated by the United States Department of the Treasury, Office of Foreign Assets Control, as a Specially Designated Narcotics Trafficker pursuant to the Foreign Narcotics Kingpin Designation Act. Rendon Herrera is also wanted to serve sentences for convictions in the Republic of Colombia relating to numerous homicides, weapons, and narcotics trafficking, which remain pending his service of his sentence in the United States.
The government’s case is being handled by the Office’s International Narcotics and Money Laundering Section. Assistant United States Attorneys Jonathan P. Lax, Francisco J. Navarro, and Andrew D. Grubin are in charge of the prosecution, with assistance provided by Assistant United States Attorney Alexander Li of the U.S. Attorney’s Office for the Southern District of New York, and Trial Attorney Elisabeth Poteat of the National Security Division’s Counterterrorism Section. The Justice Department’s Office of International Affairs handled the extradition in this matter and the Department of Justice Judicial Attaché’s Office was instrumental in supporting the case.
This prosecution is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
The Defendant:
DANIEL RENDON HERRERA (also known as “Don Mario”)
Age: 56
Antioquia, ColombiaE.D.N.Y. Docket Nos. 14-CR-625 (S-3) (DLI) / 20-CR-569 (S-6) (DLI)
S.D.N.Y. Docket Nos. 04-CR-962 (LAP) / 08-CR-659 (SAS)
Six Individuals Indicted for Conspiracy to Distribute More Than 100 Kilograms of Controlled Substances on Long Island and in New JerseyRead the Press Release
Earlier today, in federal court in Central Islip, an indictment was unsealed charging Anthony Cyntje, a New Jersey correction officer, Anthony Leonardi, his brother Robert Leonardi, William Junior Maxwell II, who is the rap artist also known as “Fetty Wap,” Brian Sullivan, and Kavaughn Wiggins with conspiring to distribute and possess controlled substances. Five of the defendants are also charged with using firearms in connection with drug trafficking.
Sullivan was arrested on September 30, 2021, arraigned before United States Magistrate Judge Steven L. Tiscione, and ordered detained pending trial. Anthony Leonardi and Cyntje were arrested on October 13, 2021, arraigned before United States Magistrate Judge Anne Y. Shields, and ordered detained pending trial. Robert Leonardi was arrested in Pennsylvania on October 13, 2021, arraigned before United States Magistrate Judge Richard A. Lloret of the Eastern District of Pennsylvania, and ordered detained pending trial. Wiggins was arrested on October 27, 2021, arraigned before United States Magistrate Judge Steven J. Locke, and ordered detained pending trial. Maxwell was arrested yesterday and will be arraigned this afternoon before United States Magistrate Judge Locke.
Breon Peace, United States Attorney for the Eastern District of New York; Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); Timothy D. Sini, District Attorney for Suffolk County; and Stuart Cameron, Acting Commissioner, Suffolk County Police Department (SCPD), announced the charges.
“As alleged, the defendants transported, distributed and sold more than 100 kilograms of deadly and addictive drugs, including heroin and fentanyl, on Long Island, deliberately contributing to the opioid epidemic that has devastated our communities and taken too many lives,” stated United States Attorney Peace. “We will continue to work nonstop with our law enforcement partners to keep our neighborhoods safe from the scourge of dangerous drugs and gun violence.” Mr. Peace thanked the United States Postal Inspection Service for its assistance during the investigation.
“The pipeline of drugs in this investigation ran thousands of miles from the West Coast to the communities here in our area, contributing to the addiction and overdose epidemic we have seen time and time again tear people's lives apart. The fact that we arrested a chart-topping rap artist and a corrections officer as part of the conspiracy illustrates just how vile the drug trade has become. I want to commend the work of our Long Island Gang Task Force and our law enforcement partners for working day in and day out to get these deadly drugs off our streets,” stated FBI Assistant Director-in-Charge Driscoll.
“These defendants ran a multimillion-dollar bicoastal drug distribution organization with Suffolk County as their home base,” stated District Attorney Sini. “They were wholesale drug dealers who pumped massive quantities of narcotics into our communities. As our investigation revealed, they would frequently use cutting agents to process just one of those kilograms of drugs into as many as four even before it was distributed to lower-level dealers, so the magnitude of this operation was enormous. Thanks to law enforcement’s efforts, this prolific supply chain has been cut off. I thank the Eastern District for partnering with my Office to prosecute these individuals and hold them accountable.”
“This is another example of law enforcement working together to take down a major drug trafficking ring that brought more than 100 kilograms of illicit narcotics to Long Island and New Jersey,” stated SCPD Acting Commissioner Cameron said. “Holding these six individuals accountable, most of whom were using firearms to protect their drugs, will have a significant impact on the drug supply in Suffolk County and will help us in our continuing effort to combat the opioid epidemic.”
As alleged in the indictment and in court proceedings, from approximately June 2019 through June 2020, the defendants distributed more than 100 kilograms of cocaine, heroin, fentanyl, and crack cocaine across Long Island and New Jersey. The defendants obtained the narcotics on the West Coast and used the United States Postal Service and drivers with hidden vehicle compartments to transport the controlled substances across the country to Suffolk County, where they were stored. The drugs were then distributed to dealers who sold the controlled substances on Long Island and in New Jersey. Five of the defendants also used firearms to protect their drug organization and distribution chain. Defendants Anthony Leonardi, Robert Leonardi, Sullivan, and Wiggins participated in the purchase and transport of the narcotics from the West Coast to the East Coast where they were processed, stored, and ultimately resold. Maxwell was a kilogram-level redistributor for the trafficking organization and Cyntje transported kilograms of cocaine from Long Island to New Jersey.
Search warrants executed during the investigation resulted in the recovery of approximately $1.5 million in cash, 16 kilograms of cocaine, 2 kilograms of heroin, numerous fentanyl pills, two 9mm handguns, a rifle, a .45 caliber pistol, a .40 caliber pistol, and ammunition.
The charges in the indictment are allegations, and the defendants are presumed innocent unless and until proven guilty. If convicted, the defendants face a maximum of life imprisonment.
The government’s case is being handled by the Office’s Long Island Criminal Division. Assistant United States Attorneys Christopher C. Caffarone, Andrew P. Wenzel, and Special Assistant United States Attorney Jacob T. Kubetz are in charge of the prosecution.
The Defendants:
Anthony Cyntje
Age: 23
Passaic, New JerseyAnthony Leonardi
Age: 47
Coram, New YorkRobert Leonardi
Age: 26
Levittown, PennsylvaniaWillie Junior Maxwell II (also known as “Fetty Wap”)
Age: 30
Paterson, New JerseyBrian Sullivan
Age: 26
Lake Grove, New YorkKavaughn L. Wiggins (also known as “KV”)
Age: 26
Coram, New YorkE.D.N.Y. Docket No. 21-CR-452 (JS)
Queens Man Charged with Murdering Woman in Life Insurance SchemeRead the Press Release
A superseding indictment was filed today in federal court in Brooklyn charging Cory Martin with murder-for-hire and conspiracy to commit murder-for-hire. Martin was previously charged with conspiracy to commit wire fraud, aggravated identity theft and fraudulent use of identification relating to an alleged scheme to fraudulently obtain life insurance policies in the name of Brandy Odom, a 26-year-old woman, murder her, and then claim benefits under the life insurance policies.
Breon Peace, United States Attorney for the Eastern District of New York, Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Dermot F. Shea, Commissioner, New York City Police Department (NYPD), announced the charges.
“The defendant allegedly brutally murdered a young woman, dismembered her body and scattered her body parts in a Brooklyn park in order to profit from life insurance policies that he fraudulently obtained in her name,” stated United States Attorney Peace. “He will now be held to account for his alleged heinous acts. We hope that today’s charges bring some measure of solace to the victim’s family.”
Mr. Peace expressed his appreciation to the Brooklyn South Homicide Squad of the New York City Police Department and the Brooklyn District Attorney’s Office for their outstanding investigative work on this case and for their assistance during the prosecution.
“It's unthinkable that a person could view another human being as a get rich quick scheme. We allege Mr. Martin murdered, then dismembered a young woman so he could cash in on fraudulent life insurance policies. Ms. Odom didn't deserve the sheer indignity of dying that way, no one does. Mr. Martin facing justice won't bring Ms. Odom back, but it will keep him from plotting another despicable attempt at profiting off someone's life,” stated FBI Assistant Director-in-Charge Driscoll.
“With dogged tenacity and meticulous investigative work, our NYPD detectives and law enforcement partners never wavered in their mission to seek justice for this crime victim. Now, more than three years after the malicious fraud and brutal killing alleged in today's indictment, New Yorkers can find our collective answer in these court papers from the United States Attorney's Office for the Eastern District of New York,” stated NYPD Commissioner Shea.
As alleged in the indictment and other court documents, in March 2017, a year prior to Odom’s murder, Martin and a co-conspirator fraudulently obtained two life insurance policies in the victim’s name. They arranged for premium payments to the life insurance companies to be made by Western Union money order and by using a debit card in Odom’s name.
In April 2018, Martin allegedly strangled Odom, and, over the course of several days, dismembered her corpse. On April 6, 2018, Martin had searched Home Depot’s website for an online listing for a “Dewalt 12-Amp Corded Reciprocating Saw,” described as featuring a “powerful 12 Amp motor designed for heavy-duty applications.” Later that evening, Martin searched YouTube using the search term “how to insert blade for reciprocating saw” and “using reciprocating saw,” which he subsequently deleted from his cell phone.
In the early morning of April 8 and April 9, 2018, Martin disposed of Odom’s body parts in Canarsie Park with the assistance of his co-conspirator. On April 10, 2018, Martin conducted dozens of Internet searches for news articles, including “Search area expands after dismembered body found in Canarsie Park in Brooklyn.” Martin also accessed a Twitter post titled “Person walking dog discovers remains of woman in Brooklyn park.” The following day, Martin searched YouTube using the search term “exclusive interview of mother of girl found in park.” After Odom’s murder, at Martin’s direction, several unsuccessful attempts to claim benefits under Odom’s life insurance policies were made by his co-conspirator.
The charges in the indictment are allegations, and the defendant is presumed innocent unless and until proven guilty. If convicted, Martin faces a mandatory penalty of life imprisonment, or possibly, the death penalty.
The government’s case is being handled by the Office’s Organized Crime and Gangs Section. Assistant United States Attorneys Tanya Hajjar and Emily Dean are in charge of the prosecution.
The Defendant:
CORY MARTIN
Age: 34
Queens, New YorkE.D.N.Y. Docket No. 20-CR-549 (AMD)
Nine Therapists Arrested in Scheme to Defraud Program for Developmentally Disabled ChildrenRead the Press Release
A criminal complaint was unsealed today in federal court in Brooklyn charging Marsiste Adolphe, Margaret Dominique-McLain, Mercedes Falcon, Tracy Gibson, Roselee Johnson, Jeannette Monclova, Manuel Moore, Kikelomo Ogundiran, and Dino Paolicelli with stealing more than $3 million from the New York State Early Intervention Program (the “EIP”), including more than $993,000 from Medicaid and more than $1,998,000 from the New York City Department of Health and Mental Hygiene (“NYC DOHMH”), an agency that receives federal funds. The EIP is a New York State program that provides remedial services to developmentally delayed children from birth to age three, such as physical therapy, occupational therapy, speech therapy, special instruction and social work services. The defendants, all EIP therapists, were arrested earlier today and are scheduled to make their initial appearance this afternoon before United States Chief Magistrate Judge Cheryl L. Pollak.
Breon Peace, United States Attorney for the Eastern District of New York, Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Margaret Garnett, Commissioner, New York City Department of Investigation (DOI), announced the charges.
“As alleged, the defendants exploited disabled infants and toddlers, the youngest and most vulnerable among us, to enrich themselves by millions of dollars,” stated United States Attorney Peace. “This Office and our law enforcement partners will continue to vigorously protect government programs from fraud and abuse that not only hurts taxpayers, but also deprives developmentally delayed children from receiving much-needed services.” Mr. Peace also thanked the office of the Special Commissioner of Investigation for the New York City School District for its assistance on the case.
“Defrauding government programs produces a ripple effect that trickles down to taxpayers who foot the bill for fraud schemes. As alleged in this complaint, however, the defendants not only stole money from the system itself, they also prevented children with EIPs from accessing the amount of care they were authorized to receive. When systems designed to help our most vulnerable are manipulated in this way, rest assured federal charges will be applied,” stated FBI Assistant Director-in-Charge Driscoll.
“This criminal case exemplifies the broad and damaging impact of corruption. These nine defendants not only stole more than $3.3 million in public funds but also robbed more than 200 New York City children of essential Early Intervention services they were entitled to receive, according to the charges. The City Department of Health and Mental Hygiene (DOHMH) was instrumental in identifying billing discrepancies involving Early Intervention specialists and then referring them to DOI for further investigation. I thank our law enforcement partners, the FBI and the U.S. Attorney’s Office for the Eastern District of New York for their collaboration on this important investigation; and the DOHMH for spotting the inconsistencies and immediately referring them. This type of cooperation among agencies and law enforcement is essential in combatting corruption,” stated DOI Commissioner Garnett.
As set forth in the complaint, between January 1, 2015 and June 30, 2019, the defendants allegedly submitted fraudulent documentation for thousands of EIP therapy sessions that never took place. The defendants collectively received millions of dollars as payments for these non-existent EIP therapy sessions. In addition, because each EIP recipient is only entitled to a fixed number of sessions, fraudulently billing for sessions that do not take place deprives disabled infants and toddlers of EIP therapy sessions they are entitled to receive.
For example, Adolphe claimed to provide EIP therapy sessions every single day of 2016, including on Christmas and Thanksgiving. Gibson claimed to provide EIP therapy sessions every day from April 2, 2017 to July 31, 2018. Between May 8, 2016 and September 8, 2018, a period of 854 days, Manuel Moore claimed to provide EIP therapy sessions every day except January 4, 2018. Paolicelli claimed to provide EIP therapy sessions a total of 1,086 days out of 1,096 days between January 1, 2016 and December 31, 2018. Falcon claimed to provide EIP therapy sessions from early in the morning and until late into the evening — sometimes claiming that sessions began at 4:00 a.m. or ended at 3:00 a.m. The evidence also revealed that Ogundiran’s travel records reflected that she billed for at least 300 EIP therapy sessions at times when she was not in New York. Moore’s cell phone records reflected that he was not in the area of claimed EIP sessions on at least 6,025 sessions, and Falcon’s phone records also reflected that she was not in the area of claimed EIP sessions on at least 6,100 occasions.
The charges in the complaint are allegations, and the defendants are presumed innocent unless and until proven guilty. If convicted, they each face a statutory maximum of 10 years of imprisonment.
The government’s case is being handled by the Office’s Public Integrity Section. Assistant United States Attorneys Kaitlin Farrell and Jonathan Siegel are in charge of the prosecution.
The Defendants:
MARSISTE ADOLPHE
Age: 58
Brooklyn, New YorkMERCEDES FALCON
Age: 57
Brooklyn, New YorkKIKELOMO OGUNDIRAN
Age: 54
Dix Hills, New YorkMANUEL MOORE
Age: 36
Manhattan, New YorkROSELEE JOHNSON
Age: 73
Brooklyn, New YorkJEANETTE MONCLOVA
Age: 69
North Bellmore, New YorkMARGARET DOMINIQUE-MCLAIN
Age: 54
Mastic, New YorkTRACY GIBSON
Age: 37
Queens, New YorkDINO PAOLICELLI
Age: 58
Staten Island, New YorkE.D.N.Y. Docket No. 21-MJ-1205
Navillus Construction Executives Convicted of Embezzling from Union Benefits FundsRead the Press Release
Earlier today, in federal court in Brooklyn, a jury returned guilty verdicts against Donal O’Sullivan, the founder, owner and President of Navillus Tile, Inc. d/b/a/ Navillus Contracting (“Navillus”), one of New York City’s largest construction firms, Padraig Naughton, Navillus’s Financial Controller, and Helen O’Sullivan, a Payroll Administrator, on all 11 counts charging wire fraud, mail fraud, embezzlement from employee benefits funds, submission of false remittance reports to union benefits funds, and conspiracy to commit those crimes. The verdicts followed a three-week trial before United States District Judge Pamela K. Chen. When sentenced, each of the defendants faces up to 20 years in prison.
Breon Peace, United States Attorney for the Eastern District of New York, announced the verdict.
“As found by the jury, the defendants deliberately devised a fraudulent scheme to avoid making required contributions to union benefits funds on behalf of Navillus’s workers, in order to deprive the workers of benefits they had earned and deserved,” stated United States Attorney Peace. “This Office and its law enforcement partners will continue to investigate and prosecute these types of blatant frauds that are harmful to workers.”
Mr. Peace expressed his thanks to the agents and investigators of the Federal Bureau of Investigation, New York Field Office; United States Department of Labor, Office of Inspector General; the United States Department of Labor, Employee Benefits Security Administration; the Port Authority of New York and New Jersey, Office of Inspector General; and Homeland Security Investigations for their outstanding work on the case.
Navillus was a signatory to multiple collective bargaining agreements that required the company to make contributions to union benefits funds, such as health, pension and vacation funds, for all “covered work” performed by its workers at construction sites. Between 2011 and 2017, the defendants engaged in a scheme to avoid making these required contributions by placing some of Navillus’s workers on the payroll of another company (the “Consulting Company”). The Consulting Company then issued weekly paychecks to those Navillus workers for work they did on Navillus construction jobs. To conceal the scheme from benefits fund auditors, the defendants caused the Consulting Company to issue fraudulent invoices to disguise the fact that the funds Navillus had issued to the Consulting Firm were made to reimburse the Consulting Company for the wages the Consulting Company had paid to Navillus workers.
The government’s case is being handled by the Office’s Public Integrity Section. Assistant United States Attorneys Turner Buford and Meredith Arfa, and Special Assistant United States Attorney Virginia Nguyen are in charge of the prosecution.
The Defendants:
DONAL O’SULLIVAN
Age: 60
Queens, New YorkPADRAIG NAUGHTON
Age: 49
New York, New YorkHelen o’sullivan
Age: 61
Queens, New YorkE.D.N.Y. Docket No. 20-CR-272 (PKC)
Long Island MS-13 Gang Member Pleads Guilty to 2019 Murder of 15-Year-Old in Central IslipRead the Press Release
Earlier today, in federal court in Central Islip, Jose Omar Sorto Portillo, a member of the Leeward Locos Salvatruchas clique of La Mara Salvatrucha, also known as the MS-13, a transnational criminal organization, pleaded guilty to murder in aid of racketeering for his participation in the August 7, 2019 murder of 15-year-old Jasson Medrano-Molina. The proceeding was held before United States Circuit Judge Joseph F. Bianco.
Breon Peace, United States Attorney for the Eastern District of New York, Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), Stuart Cameron, Acting Commissioner, Suffolk County Police Department (SCPD), and Timothy Sini, Suffolk County District Attorney, announced the guilty plea.
“With today’s guilty plea, the defendant admitted to shooting a 15-year-old alleged rival gang member to death at close range in a meaningless effort to boost his status as an MS-13 gang member,” stated United States Attorney Peace. “This Office, in partnership with the Long Island Gang Task Force, will continue to work tirelessly to prevent these senseless killings and eliminate gang violence that is endangering our communities.”
“MS-13 will stop at nothing in their reign of terror, including this senseless murder of a teenager,” stated SCPD Commissioner Cameron. “I am proud of the efforts of the Suffolk County Police Department and its law enforcement partners to bring these violent individuals to justice and cripple this transnational criminal organization.”
“This senseless murder was characteristic of MS-13’s M.O., which is to commit acts of violence against anyone perceived as an enemy, even when that person is only a 15-year-old child,” stated District Attorney Sini. “This is the latest of many convictions that hold these dangerous gang members responsible for the death they’ve caused. It has been a major focus of my Office to decimate MS-13’s presence on Long Island, and we’ve been very successful in those efforts by working in close collaboration with our federal partners in the U.S. Attorney’s Office and cross-designating assistant district attorneys to prosecute gang members together. We will continue to keep the pressure on to prevent gang violence in our communities and keep the public safe.”
According to court filings and statements by the defendant at the guilty plea proceeding, in July and August 2019, the defendant and other MS-13 members and associates were seeking to attack and kill individuals whom they believed were rival gang members in order to elevate their own positions in the gang. The defendant and his co-conspirators targeted several individuals, including the victim. In the early morning hours of August 7, 2019, the defendant and two co-conspirators lured Medrano-Molina and two other individuals to a wooded area in Central Islip. The defendant, who was armed with a .40 caliber handgun, was waiting in the wooded area for an MS-13 associate to lead the victim and other individuals to the pre-determined location. When the victim arrived, the defendant shot him multiple times at close range. Medrano-Molina died at the scene. The other two individuals ran and were able to escape unharmed.
Portillo is now 18 years-old and was 16 years-old at the time of the Medrano-Molina murder. He was initially was charged by a complaint on August 14, 2019, and, thereafter, a juvenile information on September 13, 2019, both of which were filed under seal in the Eastern District of New York. Prior to pleading guilty, Portillo consented to being transferred to adult status in the case.
Today’s conviction is the latest in a series of federal prosecutions by the United States Attorney’s Office for the Eastern District of New York targeting members of the MS-13, a violent, transnational criminal organization. The MS-13’s leadership is based in El Salvador, Honduras, Guatemala and Mexico, but the gang has thousands of members across the United States. With numerous branches, or “cliques,” the MS-13 is the most violent criminal organization on Long Island. Since 2003, hundreds of MS-13 members, including dozens of clique leaders, have been convicted on federal felony charges in the Eastern District of New York. A majority of those MS-13 members have been convicted on federal racketeering charges for participating in murders, attempted murders and assaults. Since 2010, this Office has obtained indictments charging MS-13 members with carrying out more than 60 murders in the Eastern District of New York, and has convicted dozens of MS-13 leaders and members in connection with those murders. These prosecutions are the product of investigations led by the FBI’s Long Island Gang Task Force, which is comprised of agents and officers of the FBI, SCPD, Nassau County Police Department, Nassau County Sheriff’s Department, Suffolk County Probation Office, Suffolk County Sheriff’s Office, the New York State Police, the Hempstead Police Department, the Rockville Centre Police Department and the New York State Department of Corrections and Community Supervision.
The government’s case is being handled by the Office’s Long Island Criminal Division. Assistant United States Attorneys John J. Durham, Paul G. Scotti, Justina L. Geraci, Megan E. Farrell, and Special Assistant United States Attorney Kathleen Kearon are in charge of the prosecution.
The Defendant:
JOSE OMAR SORTO PORTILLO (also known as “Duende”)
Age: 18
Central Islip, New YorkE.D.N.Y. Docket No. 19-CR-423 (S-1)(JFB)
Former Mexican Federal Police Commander Pleads Guilty to Drug-Trafficking ConspiracyRead the Press Release
Earlier today in federal court in Brooklyn, Ivan Reyes Arzate, a former Mexican Federal Police Officer and Commander of the Mexican Federal Police’s Sensitive Investigative Unit (“SIU”), pleaded guilty to cocaine trafficking conspiracy. Reyes Arzate received a bribe in exchange for agreeing to assist the El Seguimiento 39 drug cartel ship cocaine from Mexico to the United States. The El Seguimiento 39 cartel is associated with the Sinaloa Cartel, the Beltran Leyva Organization and other Mexico-based cartels. Today’s proceeding was held before U.S. District Judge Brian M. Cogan.
Breon Peace, United States Attorney for the Eastern District of New York; Ray Donovan, Special Agent-in-Charge, Drug Enforcement Administration, New York Division (DEA); Ricky J. Patel, Acting Special Agent-in-Charge, Homeland Security Investigations, New York (HSI); Dermot F. Shea, Commissioner, New York City Police Department (NYPD); and Kevin P. Bruen, Superintendent, New York State Police (NYSP), announced the guilty plea.
“By accepting thousands of dollars in bribes in exchange for information about law enforcement’s investigation into the El Seguimiento 39 cartel, Arzate forged a deplorable alliance with drug traffickers, and betrayed not only the people of Mexico he was sworn to protect, but also his law enforcement partners who put themselves at risk to disrupt the cartel,” stated United States Attorney Peace. “This Office and its law enforcement partners remain committed to rooting out corruption and preventing drug cartels from sending massive quantities of illegal drugs into the United States.” Mr. Peace expressed his appreciation to the United States Attorney’s Offices for the Southern District of California and the Northern District of Illinois for their assistance on the case.
“Reyes-Arzate turned a blind eye toward drug traffickers, enabling criminal enterprises to operate with impunity, while serving as a Commander in the Mexican Federal Police. DEA and our law enforcement partners worked tirelessly to isolate and identify this bad seed and bring him to justice,” stated DEA Special Agent-in-Charge Donovan.
“Arzate turned his back on the people of Mexico who he was sworn to protect, on the oath that he took to uphold law and order, and on his fellow law enforcement brothers and sisters around the globe, who put their trust in each other to combat the scourge of narcotics trafficking carried out by vicious drug cartels,” stated HSI Acting Special Agent-in-Charge Patel. “At the time when Arzate commanded a special unit of the Mexican Federal Police and worked closely with law enforcement officials from the U.S., he was also meeting with the leadership of several Mexico-based cartels. He chose to selfishly serve his own interest by taking hundreds of thousands of dollars in bribes from the cartels in exchange for sensitive information about U.S. investigations. This case was carried out in coordination with the full force of U.S. law enforcement and Arzate will now have to answer for his crimes when he learns his sentence.”
“This guilty plea should demonstrate that who choose abuse their position of trust and put others in danger for financial gain, will be brought to justice. This former police officer and commander not only betrayed those he swore to protect, but also his fellow law enforcement working to dismantle a dangerous drug cartel. The State Police will continue to work with our law enforcement partners to prevent cartels from shipping deadly narcotics to the United States, but also to hold accountable those who mistakenly think they can get away with and benefit from these types of crimes,” stated NYSP Superintendent Bruen.
SIU officers in Mexico routinely work with U.S. law enforcement to combat narcotics trafficking, money laundering and other criminal activities. From 2003 to 2016, Reyes Arzate was a Mexican Federal Police Officer assigned to SIU. In 2008, he was appointed SIU Commander, making him its highest-ranking officer and principal point of contact for information sharing between U.S. and Mexican law enforcement personnel assigned to the SIU.
In approximately November 2016, while participating in a joint investigation of El Seguimiento 39 with U.S. law enforcement authorities, Reyes Arzate met with the leadership of El Seguimiento 39, shared with them information about the U.S. law enforcement investigation, and accepted a $290,000 bribe in exchange for his agreement to assist the cartel.
When sentenced, Reyes Arzate faces a mandatory minimum sentence of five years in prison and a maximum sentence of 40 years in prison.
This investigation was led by the New York Strike Force, a crime-fighting unit comprising federal, state and local law enforcement agencies supported by the Organized Crime DEA Task Force and the New York/New Jersey High Intensity Drug Trafficking Area. The Strike Force is based at the DEA’s New York Division and includes agents and officers of the DEA, NYPD, NYSP, HSI, U.S. Internal Revenue Service Criminal Investigation Division, Bureau of Alcohol, Tobacco, Firearms and Explosives, U.S. Customs and Border Protection, U.S. Secret Service, United States Marshals Service, New York National Guard, Clarkstown Police Department, U.S. Coast Guard, Port Washington Police Department and New York State Department of Corrections and Community Supervision.
The government’s case is being handled by the Office’s International Narcotics and Money Laundering and Public Integrity Sections. Assistant United States Attorneys Ryan Harris and Philip Pilmar are in charge of the prosecution.
The Defendant:
IVAN REYES ARZATE
Age: 49
Mexico City, MexicoE.D.N.Y. Docket No. 20-CR-30 (BMC)
Credit Suisse Resolves Fraudulent Mozambique Loan Case in $547 Million Coordinated Global ResolutionRead the Press Release
BROOKLYN, NY – Credit Suisse Group AG, a global financial institution headquartered in Switzerland, and Credit Suisse Securities (Europe) Limited (CSSEL), its subsidiary in the United Kingdom (collectively, Credit Suisse), each admitted to conspiring to commit wire fraud by defrauding U.S. and international investors in an $850 million loan to finance a tuna fishing project in Mozambique. Credit Suisse has been assessed with more than $547 million in penalties, fines and disgorgement as part of coordinated resolutions with criminal and civil authorities in the United States and the United Kingdom. After taking account of crediting by the department of the other resolutions, Credit Suisse will pay approximately $475 million, as well as restitution to victims in an amount to be determined by the Court. As part of these coordinated resolutions with the department, the U.S. Securities & Exchange Commission (SEC) and the U.K. Financial Conduct Authority (FCA), as well as an enforcement action by Switzerland’s Financial Market Supervisory Authority (FINMA), Credit Suisse will be subject to enhanced compliance and self-reporting, including that FINMA will impose an independent third party to monitor the bank’s transactions, risk management and internal control systems, as well as its existing credit transactions with financially weak and corruption-prone states and companies, to prevent and detect similar conduct in the future.
Credit Suisse entered into a deferred prosecution agreement with the department in connection with a criminal information filed today in the U.S. District Court for the Eastern District of New York charging the bank with conspiracy to commit wire fraud. CSSEL pleaded guilty in the U.S. District Court for the Eastern District of New York to a one-count criminal information charging it with conspiracy to commit wire fraud.
Previously, Andrew Pearse, a former managing director of CSSEL, pleaded guilty to conspiracy to commit wire fraud. Surjan Singh, a former managing director of CSSEL, and Detelina Subeva, a former vice president of CSSEL, pleaded guilty to conspiracy to commit money laundering. These cases are assigned to United States District Judge William F. Kuntz II of the Eastern District of New York.
Breon Peace, United States Attorney for the Eastern District of New York, Kenneth A. Polite Jr., Assistant Attorney General of the Justice Department’s Criminal Division, and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), made the announcement.
“Over the course of several years, Credit Suisse, through its subsidiary in the United Kingdom, engaged in a global criminal conspiracy to defraud investors, including investors in the United States, by failing to disclose material information to investors, including millions of dollars in kickbacks to its bankers and a high risk of corruption, in connection with a $850 million fraudulent loan to a Mozambique state-owned entity,” stated U.S. Attorney Peace. “This coordinated global resolution demonstrates this Office’s commitment to working across borders with our global law enforcement partners to root out abuse and fraud by financial institutions in order to protect investors here in the United States.”
“Credit Suisse Group AG, through its U.K. subsidiary CSSEL, defrauded U.S. and international investors in connection with a lending project in Mozambique,” stated Assistant Attorney General Polite. “Among other things, Credit Suisse Group AG, CSSEL, and their co-conspirators deceived investors by hiding information about the risk that loan proceeds were used for illegal purposes in connection with the restructuring of the loan. Today’s coordinated resolution with the U.S. Securities and Exchange Commission and the Financial Conduct Authority in the United Kingdom shows that the department will not tolerate fraud by international financial institutions and is committed to working in parallel to domestic and foreign authorities to use all tools at our disposal to hold corporate wrongdoers accountable.”
According to Credit Suisse’s admissions and court documents, between 2013 and March 2017, Credit Suisse, through its subsidiary CSSEL, and its co-conspirators used U.S. wires and the U.S. financial system to defraud investors in securities related to a Mozambican state-owned entity, Empresa Moçambicana de Atum, S.A. (EMATUM), which Mozambique created to develop a state-owned tuna fishing project. Credit Suisse, through its employees and agents, conspired to defraud investors and potential investors in EMATUM by making numerous material misrepresentations and omissions relating to, among other things (i) the use of loan proceeds; (ii) kickback payments to CSSEL bankers and the risk of bribes to Mozambican officials; and (iii) the existence and maturity dates of debt owed by Mozambique, including another private loan that Credit Suisse arranged for a Mozambique state-owned entity (ProIndicus) and a different private loan another bank arranged with Credit Suisse’s knowledge. Credit Suisse represented to investors that the loan proceeds would only be used for the tuna fishing project. Instead, the co-conspirators used U.S. wires to divert loan proceeds obtained from investors; specifically, the contractor paid kickbacks of approximately $50 million to CSSEL bankers and bribes totaling approximately $150 million to senior Mozambican government officials.Credit Suisse also admitted that, prior to and during the EMATUM financing, it identified significant red flags concerning the transaction. For example, Credit Suisse identified significant corruption and bribery concerns associated with the contractor that supplied the boats and equipment for EMATUM and which received the loan proceeds directly from Credit Suisse. In addition, in or about 2015, Credit Suisse became aware that EMATUM had encountered problems servicing the loan, raising the risk of default. Credit Suisse agreed to arrange the restructuring and exchange of the original EMATUM security into a sovereign bond with a longer maturity date (the “EMATUM Exchange”). Credit Suisse did so, in part, to protect its reputation. During the EMATUM Exchange, Credit Suisse employees raised concerns about corruption allegations made in the press about the ProIndicus loan and disparities in the use of EMATUM loan proceeds. To address these concerns, Credit Suisse retained two independent industry experts to conduct a market valuation of the tuna fishing boats and other goods the contractor provided for the project. Credit Suisse knew that these experts identified a shortfall of between $265 million and $394 million between the funds raised for the EMATUM loan and the fair market value of the boats and accompanying infrastructure and training the contractor sold to EMATUM. Credit Suisse did not disclose this material information to investors during the EMATUM Exchange. Aspects of Credit Suisse’s fraudulent conduct were revealed beginning in April 2016, causing the price of the EMATUM Securities to drop and resulting in losses to investors.
Under the terms of the agreements, Credit Suisse will be assessed a criminal penalty of over $247 million, and after crediting by the department to the other resolutions, will pay approximately $175 million to the United States. Credit Suisse has also agreed to an event study methodology to calculate proximate fraud loss for victims of its criminal conduct, and the amount of restitution that Credit Suisse will pay to those victims will be determined at a future proceeding. Credit Suisse also reached separate parallel resolutions with the SEC and the FCA. In addition, as part of FINMA’s enforcement action, Credit Suisse will be subject to FINMA’s supervisory powers and enforcement tools, including an independent third-party monitor, to determine the effectiveness of the bank’s compliance measures for business conducted in financially weak and high-risk corruption countries.
The department reached this resolution with Credit Suisse based on several factors, including the nature and seriousness of the offense, which included the involvement of several bankers within CSSEL. Credit Suisse received credit for its cooperation with the department’s investigation because, among other things, it provided documents and information to the department and made several employees available as witnesses. Accordingly, the total criminal penalty reflects a 15 percent reduction off the bottom of the applicable United States Sentencing Guidelines range. Credit Suisse has also agreed to continue to cooperate with the department, to enhance its compliance program and internal controls, and provide enhanced reporting to the department on the bank’s remediation and compliance program. Among other things, the enhanced reporting provisions require Credit Suisse to meet with the department at least quarterly and to submit yearly reports regarding the status of its remediation efforts, the results of its testing of its compliance program, and its proposals to ensure that its compliance program is reasonably designed, implemented, and enforced so that is effective in deterring and detecting violations of fraud, money laundering, the Foreign Corrupt Practices Act, and other applicable anti-corruption laws.
The investigation was conducted by the FBI’s New York Field Office. The prosecution is being handled by the Business and Securities Fraud Section of the U.S. Attorney’s Office for the Eastern District of New York and the Criminal Division’s Fraud Section and Money Laundering and Asset Recovery Section. Assistant U.S. Attorney Hiral Mehta of the Eastern District of New York and Trial Attorneys Molly Moeser, David Fuhr and Katherine Nielsen of the Criminal Division are prosecuting the case. The Justice Department’s Office of International Affairs of the Criminal Division provided critical assistance in this case.
The department also appreciates the significant assistance provided by SEC and the FCA. The department also expresses its appreciation for the assistance provided by authorities in Switzerland and the United Kingdom in responding to Mutual Legal Assistance requests.
The Defendants:
CREDIT SUISSE GROUP AG
E.D.N.Y. Docket No. 21-CR-521
CREDIT Suisse Securities (Europe) limited
E.D.N.Y. Docket No. 21-CR-520
Man Pleads Guilty to Attempting to Provide Material Support to ISIS and Al-Nusra FrontRead the Press Release
An Illinois man pleaded guilty today to attempting to provide material support to designated foreign terrorist organizations, the Islamic State of Iraq and al-Sham (ISIS) and Al-Nusra Front (ANF). As part of his plea agreement, the defendant agrees to the entry of an order of removal so he will be removed from the country after completing his sentence.
According to court documents, Dilshod Khusanov, 36, of Chicago, encouraged individuals to travel to Syria to wage violent jihad, or holy war in 2014 and 2015. For example, on Sept. 28, 2014, Khusanov urged co-conspirator Akmal Zakirov to engage in jihad: “I hope that the only [reason] that is preventing you from jihad is some mistakes and flaws that are occurring among” the other fighters. Khusanov explained that it would be better to help those fighters, rather than criticize them.
Later in 2014, two Brooklyn residents, Abdurasul Juraboev and Akhror Saidakhmetov, began planning to travel to Syria to fight for ISIS. A group of individuals in a domestic network based in New York and elsewhere, including Khusanov, worked together to raise and contribute money to help fund that trip to Syria. In February 2015, Abror Habibov, Zakirov, Azizjon Rakhmatov and Kasimov discussed providing money to support Saidakhmetov’s travel and expenses in Syria. Rakhmatov and Zakirov also agreed to solicit money from others to fund Saidakhmetov’s travel. Zakirov contacted Khusanov, then-based in Illinois, and asked him to contribute money for Saidakhmetov’s travel and to ask another individual to contribute money as well. Khusanov agreed and arranged for money to be deposited in Zakirov’s bank account before Saidakhmetov’s scheduled departure. Saidakhmetov was arrested in February 2015 at John F. Kennedy International Airport, as he boarded a plane bound for Istanbul, Turkey, a transit point for foreign fighters bound for Syria.
Khusanov is the last charged defendant in this plot to be convicted. Juraboev, Saidakhmetov, Habibov, Zakirov and Rakhmatov previously pleaded guilty, and Kasimov was convicted at trial. Juraboev and Saidakhmetov each were sentenced to 15 years’ imprisonment, and Rakhmatov was sentenced to 12 and a half years imprisonment. Habibov, Kasimov and Zakirov are awaiting sentencing.
“With today’s plea, Khusanov admits to providing financial support to individuals seeking to travel to Syria to join ISIS, a foreign terrorist organization that seeks to wage war on the United States and other countries,” said U.S. Attorney Breon Peace for the Eastern District of New York. “This office will continue to work tirelessly with its local, national and international law enforcement partners to eliminate ISIS’s jihadist regime and threat of terrorist violence.”
“Money is the oxygen that feeds the flame of any organized terrorist activity,” said Commissioner Dermot Shea of the New York Police Department (NYPD). “This case makes it clear that whether you are a terrorist bomber, a planner, or simply the facilitator who raises the money to pay for their travel, you will be a target of the New York Joint Terrorism Task Force. They are the most experienced detectives and agents in the country in these cases.”
Khusanov pleaded guilty to attempting to provide material support to ISIS and faces a maximum penalty of 11 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Assistant U.S. Attorneys David K. Kessler, J. Matthew Haggans, and Jonathan E. Algor for the Eastern District of New York, and Trial Attorney Steven Ward of the National Security Division’s Counterterrorism Section are prosecuting the case.
The FBI and NYPD are investigating the case.
Defendant Pleads Guilty to Attempting to Provide Material Support to ISIS and Al-Nusra FrontRead the Press Release
Dilshod Khusanov pleaded guilty today to attempting to provide material support to a designated foreign terrorist organization, the Islamic State of Iraq and al-Sham (ISIS) and Al-Nusra Front (ANF). The proceeding was held before United States District Court Judge William F. Kuntz, II. When sentenced, Khusanov faces 11 years’ imprisonment pursuant to the terms of his plea agreement with the government. As part of his plea agreement, the defendant agrees to the entry of an order of removal so he will be removed from the country after completing his sentence.
Breon Peace, United States Attorney for the Eastern District of New York; Mark J. Lesko, Acting Assistant Attorney General for the Justice Department’s National Security Division; Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); and Dermot F. Shea, Commissioner, New York City Police Department (NYPD), announced the guilty plea.
“With today’s plea, Khusanov admits to providing financial support to individuals seeking to travel to Syria to join a violent foreign terrorist organization that seeks to wage war on the United States and other countries,” stated United States Attorney Peace. “This Office will continue to work tirelessly with its local, national and international law enforcement partners to eliminate the threat of terrorist violence posed by ISIS and ANF.”
"Khusanov’s guilty plea is the final step toward wrapping up this years-long case in which the FBI’s Joint Terrorism Task Force worked tirelessly—as they always do—to keep the citizens of our city and our country safe from potential terrorist acts,” stated FBI Assistant Director-in-Charge Driscoll. “Khusanov now awaits his fate for his willingness to provide support to ISIS and the Al-Nusra Front. This is not the end, however, of the FBI’s continued efforts—along with those of our partners—to diminish the threats posed by terrorists and would-be terrorists worldwide.”
“Money is the oxygen that feeds the flame of any organized terrorist activity. This case makes it clear that whether you are a terrorist bomber, a planner, or simply the facilitator who raises the money to pay for their travel, you will be a target of the New York Joint Terrorism Task Force. They are the most experienced detectives and agents in the country in these cases,” stated NYPD Commissioner Shea.
As set forth in court filings, Khusanov encouraged individuals to travel to Syria to wage violent jihad, or holy war in 2014 and 2015. For example, on September 28, 2014, Khusanov urged co-conspirator Akmal Zakirov to engage in jihad: “I hope that the only [reason] that is preventing you from jihad is some mistakes and flaws that are occurring among” the other fighters. Khusanov explained that it would be better to help those fighters, rather than criticize them.
Later in 2014, two Brooklyn residents, Abdurasul Juraboev and Akhror Saidakhmetov, began planning to travel to Syria to fight for ISIS. A group of individuals in a domestic network based in New York and elsewhere, including Khusanov, worked together to raise and contribute money to help fund that trip to Syria. In February 2015, Abror Habibov, Zakirov, Azizjon Rakhmatov, and Dilkhayot Kasimov discussed providing money to support Saidakhmetov’s travel and expenses in Syria. Rakhmatov and Zakirov also agreed to solicit money from others to fund Saidakhmetov’s travel. Zakirov contacted Khusanov, then-based in Illinois, and asked him to contribute money for Saidakhmetov’s travel and to ask another individual to contribute money as well. Khusanov agreed and arranged for money to be deposited in Zakirov’s bank account before Saidakhmetov’s scheduled departure. Saidakhmetov was arrested in February 2015 at John F. Kennedy International Airport, as he boarded a plane bound for Istanbul, Turkey, a transit point for foreign fighters bound for Syria.
Khusanov is the last charged defendant in this plot to be convicted. Juraboev, Saidakhmetov, Habibov, Zakirov and Rakhmatov previously pleaded guilty, and Kasimov was convicted at trial. Juraboev and Saidakhmetov each were sentenced to 15 years’ imprisonment, and Rakhmatov was sentenced to 12 ½ year’s imprisonment. Habibov, Kasimov and Zakirov are awaiting sentencing.
The government’s case is being handled by the Office’s National Security & Cybercrime Section. Assistant United States Attorneys David K. Kessler, J. Matthew Haggans, and Jonathan E. Algor are in charge of the prosecution, with assistance provided by Trial Attorney Steven Ward of the National Security Division’s Counterterrorism Section.
The Defendant:
DILSHOD KHUSANOV
Age: 36
Chicago, IllinoisE.D.N.Y. Docket No. 17-CR-475 (WFK)
Breon Peace Sworn in as United States Attorney for the Eastern District of New YorkRead the Press Release
Breon Peace was sworn in earlier today as United States Attorney for the Eastern District of New York by United States Chief District Judge Margo K. Brodie. He was appointed by President Joseph R. Biden. As U.S. Attorney, Mr. Peace leads an office that is responsible for all federal criminal and civil cases in a district comprised of more than 8 million people in the boroughs of Brooklyn, Queens, and Staten Island, and in Nassau and Suffolk counties on Long Island. Mr. Peace now supervises a staff of approximately 163 Assistant U.S. Attorneys and 116 support personnel. Prior to his appointment, Mr. Peace was a partner in the New York office of Cleary Gottlieb Steen & Hamilton LLP and was a member of the firm’s White-Collar Defense & Investigations and Litigation Groups.
“I am honored to serve as the United States Attorney for the Eastern District of New York. This Office has a long history of excellence, integrity, and outstanding service to the community. I look forward to leading the Office’s incredibly talented and dedicated women and men in addressing present and future challenges in the Eastern District. We will continue to work tirelessly with our law enforcement partners to pursue equal justice under the law, and protect and serve the people of the district. I am eager to get to work,” stated United States Attorney Peace.
Mr. Peace has had a distinguished career, having joined Cleary in 1996. From 1997 to 1998, he served as law clerk to The Honorable Sterling Johnson, Jr., of the United States District Court for the Eastern District of New York. From 2000 to 2002, he served as an Assistant United States Attorney for the Eastern District of New York, where he successfully handled a wide array of federal criminal cases in the district court and U.S. Court of Appeals for the Second Circuit. As an Acting Professor of Clinical Law at New York University School of Law, Mr. Peace trained aspiring prosecutors in the law school’s Prosecution Clinic during the 2002-2003 academic year. He returned to Cleary in 2003 and in 2007 made history by becoming the first African American man to be elected partner at the firm. In addition to handling significant white collar, regulatory enforcement, and complex commercial litigation matters for clients, Mr. Peace held several positions of leadership at the firm, serving most recently as a member its Global Executive Committee.
In 2012, Mr. Peace was appointed by The Honorable Nicholas G. Garaufis of the United States District Court for the Eastern District of New York to serve as a Special Master in United States et al. v. City of New York, a high-profile case brought against the New York City Fire Department alleging discrimination on the basis of race and national origin in hiring black and Hispanic firefighters. While at the law firm, Mr. Peace also maintained an active pro bono practice vindicating the rights of clients in criminal, immigration, human trafficking, and civil rights cases. Notably, he led the team of lawyers that in 2016 won dismissal of the indictment of a man who had been wrongly convicted of murder, rape, and robbery in 1981 and spent almost 30 years in prison.
Mr. Peace received his J.D. in 1996 from New York University School of Law where he was a member of the Law Review and later served as a member of the Board of Trustees, and his B.A. from the University of California, Berkeley, in 1993.
Long Island Man Sentenced to 36 Months in Prison for $1 Million Bank Loan and Credit Card Fraud SchemesRead the Press Release
Earlier today, in federal court in Central Islip, Marcello Sozio, the former operator of a hyperbaric oxygen chamber business based in Great Neck, New York and Chicago, Illinois, was sentenced by United States District Judge Denis R. Hurley to 36 months’ imprisonment for wire fraud in connection with a scheme to defraud banks, his business partners and a customer who allegedly received services from Sozio’s business. The Court also ordered Sozio to pay approximately $1.1 million in forfeiture and restitution to the victims of his crimes.
The sentence was announced by Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Philip R. Bartlett, Inspector-in-Charge, United States Postal Inspection Service, New York Division (USPIS), announced the sentence.
“Today, the defendant has been deservedly sentenced to prison for the financial harm he caused by defrauding his business partners and lenders and stealing from the parents of a young patient,” stated Acting U.S. Attorney Kasulis. “In conjunction with its law enforcement partners, this Office will continue to seek compensation for victims and prosecute defendants like Sozio who, out of greed, commit fraud for their own financial gain.”
“Mr. Sozio is a classic example of a fraudster, who schemed and used others to obtain funds based on nothing but lies. Now Mr. Sozio will spend his time behind bars soaking in the air from a jail cell instead of one of his hyperbaric chambers,” stated USPIS Inspector-in-Charge Bartlett.
Between approximately March 2014 and December 2016, Sozio applied for and obtained approximately $770,000 in loans for a hyperbaric oxygen chamber business. In the loan applications, Sozio claimed that his business partners had authorized him to apply for the loans on their behalf as part of their joint business venture. The partners did not authorize the loan applications and Sozio obtained the unauthorized loans by forging the partners’ signatures on various loan documents, both by hand and electronically, and by impersonating one business partner during a telephone call with a lender. As a result of Sozio’s actions, his partners were liable for approximately $770,000 in loans. In addition, between September 2016 and December 2016, Sozio caused approximately $230,000 in credit card charges to the parents of a minor patient for services that were purportedly provided for medical reasons at a Great Neck facility that Sozio operated. In reality, Sozio provided no services to the child in exchange for the fraudulent billings.
The government’s case is being handled by the Office’s Long Island Criminal Division. Assistant United States Attorneys Bradley T. King and Madeline M. O’Connor are in charge of the prosecution.
The Defendant:
MARCELLO SOZIO
Age: 65
Huntington, New YorkE.D.N.Y. Docket No. 18-CR-177 (DRH)
Former Musical Director at St. Agnes Cathedral on Long Island Sentenced to 72 Months in Prison for Receiving Child PornographyRead the Press Release
Earlier today, in federal court in Central Islip, Michael Wustrow, a former musical director at St. Agnes Cathedral on Long Island, was sentenced by United States District Judge Denis R. Hurley to 72 months in prison for receiving child pornography. As part of his sentence, Wustrow will also be required to register as a sex offender upon his release from prison. The defendant pleaded guilty to the charge in June 2019.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the sentence.
“Today’s sentence underscores the serious consequences Wustrow will face for years to come for his sordid role in receiving child pornography and perpetuating the sexual abuse of children,” stated Acting United States Attorney Jacquelyn M. Kasulis. “Protecting vulnerable children from predators and those who traffic in child pornography will always be a priority of this Office and the Department of Justice.” Ms. Kasulis extended her grateful appreciation to the FBI’s Long Island Child Exploitation and Human Trafficking Task Force leading the investigation.
“Mr. Wustrow actions, and the material he collected, are a shock to our collective conscience. Thankfully, he's now headed to federal prison where he will no longer be a danger to the innocent children who have no ability to protect themselves from evil,” stated FBI Assistant Director-in-Charge Driscoll.
In June 2016, law enforcement officers acting in an undercover capacity engaged in chats with Wustrow via the Kik Messenger program (hereinafter “Kik”), which is an instant messaging service, during which the defendant discussed child pornography and shared images of child pornography with the officer. Wustrow utilized the Kik username “pervdad516.” In September 2017, Wustrow was found to be in possession of multiple images on his iPhone of children engaged in sexually explicit conduct. Among these images was a picture of a toddler being abused by an adult male, which Wustrow had received from the Kik messaging app.
The government’s case is being handled by the Office’s Long Island Criminal Division. Assistant United States Attorney Oren Gleich is in charge of the prosecution.
The Defendant:
MICHAEL WUSTROW
Age: 59
Freeport, New YorkE.D.N.Y. Docket No. 19-CR-00087 (DRH)
Former Internal Revenue Service Agent Sentenced to 30 Months in Prison for Identity Theft and Making False Statements During Security Background InvestigationRead the Press Release
Earlier today, in federal court in Brooklyn, Bryan Cho, a former Special Agent with the Internal Revenue Service Criminal Investigation (“IRS-CI”), was sentenced by United States District Judge Ann M. Donnelly to 30 months’ imprisonment for wire fraud and aggravated identity theft in connection with a scheme to create false identification documents and passports using the stolen identity of the former subject of an IRS-CI investigation. Additionally, the defendant forfeited $394,374.63 as part of the plea agreement. Cho pleaded guilty to the charges in June 2021. Cho’s employment was terminated since his arrest.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, announced the sentence.
“The defendant’s fraud and corruption extended to creating an entirely false identity by stealing information he obtained while conducting an investigation in his official capacity as an IRS Special Agent,” stated Acting United State Attorney Kasulis. “Today’s sentence demonstrates that this Office will vigorously prosecute and hold accountable law enforcement officials who betray the public trust and violate their sworn duty to uphold the law.” Ms. Kasulis thanked the Federal Bureau of Investigation, New York Field Office, and the Treasury Inspector General for Tax Administration for their outstanding work on the case.
Cho stole the identity of a former subject in one of his investigations and used it to create fake identification documents in the person’s name. The false documents included purported identification cards and passports from the Republic of Marshall Island, the Philippines and the Republic of Guinea Bissau. Some of the documents, including identification cards from the Philippines and the Republic of Guinea Bissau, featured Cho’s picture. One false identification document was used by Cho to register a corporation overseas in the name of the subject. Cho then lied during an official background investigation when he failed to disclose this conduct and denied having any aliases or foreign interests.
The government’s case is being handled by the Office’s Public Integrity Section. Assistant United States Attorneys Elizabeth Geddes and Turner Buford are in charge of the prosecution.
The Defendant:
BRYAN CHO (also known as “Yong Hee Cho”)
Age: 50
New York, New YorkE.D.N.Y. Docket No. 21-CR-40 (AMD)
Former CEO of Braskem Sentenced to 20 Months in Prison for Foreign Bribery and Securities Law ViolationsRead the Press Release
BROOKLYN, NY – Earlier today, in federal court in Brooklyn, Jose Carlos Grubisich, a Brazilian national and the former Chief Executive Officer of Braskem S.A. (Braskem), a publicly traded Brazilian petrochemical company, was sentenced by United States District Judge Raymond J. Dearie to 20 months in prison for conspiring to divert hundreds of millions of dollars from Braskem into a secret slush fund and to pay bribes to government officials, political parties and others in Brazil to obtain and retain business. In addition, the Court imposed a $1 million fine and Grubisich was ordered to pay $2.2 million in forfeiture.
On April 15, 2021, Grubisich pleaded guilty to one count of conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act (FCPA) and one count of conspiracy to violate the books and records provision of the FCPA and to fail to accurately certify Braskem’s financial reports.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Kenneth A. Polite, Jr., Assistant Attorney General of the Justice Department’s Criminal Division, and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the sentence.
As set forth in court filings and at today’s proceedings, between approximately 2002 and 2014, Grubisich, who served as the CEO and a member of the board of directors of Braskem—as well as in various capacities for Braskem’s parent company, Odebrecht S.A. (Odebrecht)—engaged in a scheme to bribe Brazilian government officials in violation of the FCPA. As part of the scheme, Grubisich and his co-conspirators diverted approximately $250 million from Braskem into a secret slush fund, which Grubisich and others generated through fraudulent contracts and offshore shell companies secretly controlled by Braskem.
In December 2016, Braskem and Odebrecht each pleaded guilty in the Eastern District of New York to separate one-count criminal informations charging them with conspiracy to violate the anti-bribery provisions of the FCPA. Braskem also resolved related civil proceedings with the U.S. Securities and Exchange Commission (SEC) on the same day.
The government’s case is being handled by the Office’s Business and Securities Fraud Section. Assistant U.S. Attorneys Julia Nestor and Alixandra Smith of the Eastern District of New York are in charge of the prosecution with Co-Principal Deputy Chief Lorinda Laryea and Trial Attorney Leila Babaeva of the Criminal Division’s Fraud Section. Assistant U.S. Attorney Laura D. Mantell of the Asset Recovery Section of the Office’s Criminal Division is handling forfeiture matters. The FBI’s International Corruption squad in New York is investigating the case.
The FBI’s International Corruption squad in New York investigated the case. The Criminal Division’s Office of International Affairs provided substantial assistance. The department also expresses its appreciation for the assistance provided by the SEC’s Division of Enforcement, Ministério Público Federal and the Departamento de Polícia Federal in Brazil, the Office of the Attorney General and the Federal Office of Justice in Switzerland, and the governments of Portugal, Andorra, the United Kingdom, and Panama.
The Defendant
JOSE CARLOS GRUBISICH
Age: 64
Sao Paulo, BrazilE.D.N.Y. Docket No. 19-CR-102 (RJD)
Brooklyn Felon Sentenced to 48 Months’ Imprisonment for Possessing Arsenal of Weapons Including “Ghost Guns”Read the Press Release
Earlier today, at the federal courthouse in Brooklyn, Gary Brown was sentenced by United States District Judge Eric R. Komitee, to 48 months’ imprisonment for being a convicted felon in possession of numerous firearms and ammunition. Brown pleaded guilty to the charge in April 2021.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, and John B. DeVito, Special Agent-in-Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives, New York Field Division (ATF), announced the sentence.
“As a result of the outstanding investigation conducted by agents of the ATF, the defendant has been brought to justice and his extensive collection of dangerous weapons and ammunition – including untraceable ghost guns –- no longer pose a threat to the safety of our community,” stated Acting United States Attorney Kasulis. “This Office is working tirelessly with our federal partners and local law enforcement to stem the epidemic of gun violence in this district.” Ms. Kasulis also thanked the Social Security Administration, Office of Inspector General, for their assistance with the case.
In July 2019, the Federal Bureau of Alcohol, Tobacco, Firearms and Explosives began investigating the manufacture, distribution and possession of privately made firearms (“PMFs”), which are commonly referred to as “ghost guns.” Through that investigation, law enforcement agents learned that Brown had purchased hundreds of rounds of ammunition, enough PMF parts to assemble at least fourteen separate firearms and a Ghost Gunner 2, which is a machine that can be used to assemble PMFs. On August 12, 2020, law enforcement executed a search of Brown’s residence in Brooklyn and found an arsenal of weapons, including traditional firearms, PMFs, numerous high-capacity magazines, including one 100 round magazine and multiple magazines with a capacity of thirty rounds or more and hundreds of rounds of ammunition. The firearms were strewn about the residence, where the defendant lived with his fiancé and toddler daughter, in unsecured bags and drawers. A later search of a storage locker used by Brown also revealed a 12 Gauge Shotgun, additional PMF parts, hundreds of additional rounds of ammunition and a Ghost Gunner 2.
Brown was previously convicted in May 2009 of manslaughter stemming from a 2008 incident in which Brown threw a woman to the ground causing severe head trauma, and ultimately, her death.
The government’s case is being prosecuted by Assistant United States Attorney Rachel A. Bennek.
The Defendant:
GARY BROWN
Age: 40
Brooklyn, New YorkE.D.N.Y. Docket No. 20-CR-352 (EK)
Three Former NYPD Police Officers Plead Guilty to Bribery SchemeRead the Press Release
Earlier today, in federal court in Brooklyn, Robert Hassett, a former New York City Police Department (“NYPD”) officer, pleaded guilty to conspiring to participate in a scheme to sell the personal information of automobile accident victims in exchange for bribes (the “Victim Database Scheme”). Hassett also admitted that he participated in a scheme to steer vehicles damaged in automobile accidents to a tow truck company in contravention of NYPD’s Direct Accident Response Program (“DARP”) in exchange for bribes (the “Tow Truck Scheme”).
On August 5, 2021, former NYPD officer Heather Busch pleaded guilty to accepting bribes in connection with her participation in the Tow Truck Scheme. On October 6, 2021, a third defendant, retired NYPD officer Robert Smith, pleaded guilty to accepting bribes in connection with his participation in the Tow Truck Scheme; Smith also pleaded guilty to attempted distribution of at least one kilogram of heroin. As part of his plea, Smith also admitted that he participated with Hassett in the Victim Database Scheme. At the time that they participated in the Tow Truck Scheme and the Victim Database Scheme, the defendants were NYPD officers assigned to the 105th Precinct in Queens, New York.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Dermot F. Shea, Commissioner, NYPD, announced the guilty pleas.
“The defendants’ guilty pleas to accepting bribes are also acknowledgements that they abused the public trust and dishonored the NYPD by their actions,” stated Acting United States Attorney Kasulis. “This Office will continue working closely with our law enforcement partners to identify and prosecute corrupt police officers.”
According to court filings and facts presented at the plea proceeding, between 2016 and 2017, Hassett and Smith received thousands of dollars of bribe payments in exchange for referring business to a towing company, contrary to DARP. Smith resumed the corrupt scheme without Hassett in late 2019 and when Smith retired from the NYPD in March 2020, Smith enlisted Busch to take his place in the scheme.
In early 2020, Smith and Hassett also sold the names and contact information of automobile accident victims whose accidents occurred within the confines of the 105th Precinct for thousands of dollars in bribe payments, ostensibly so that the purchaser could resell that personal information to physical therapy businesses and personal injury lawyers who would contact the automobile accident victims as prospective customers.
After Smith’s retirement in March 2020, he also agreed to transport what he believed to be one kilogram of heroin for a drug trafficking organization.
Since their arrests in May 2021, Busch and Hassett have resigned from the NYPD.
When sentenced, Smith faces up to 25 years in prison, while Hassett and Busch each face up to five years in prison. As part of their respective pleas, Smith has agreed to forfeit $20,000, Hassett has agreed to forfeit $10,000 and Busch has agreed to forfeit $6,000.
The government’s case is being handled by the Office’s Public Integrity Section. Assistant United States Attorneys Ryan C. Harris and Nicholas J. Moscow are in charge of the prosecution.
The Defendants:
HEATHER BUSCH
Age: 34
Massapequa, New YorkROBERT HASSETT
Age: 36
Farmingville, New YorkROBERT SMITH
Age: 44
Plainview, New YorkE.D.N.Y. Docket No. 21-CR-254 (RPK)
Staten Island Business Owner Pleads Guilty to Mail Fraud in Scheme to Exploit the COVID-19 CrisisRead the Press Release
This afternoon, in federal court in Brooklyn, Kevin J. Lipsitz pleaded guilty before United States District Judge Kiyo A. Matsumoto to mail fraud in connection with his sale of large quantities of personal protective equipment (PPE) at the beginning of the COVID-19 pandemic. When sentenced, Lipsitz faces up to 20 years in prison, as well as forfeiture, a fine of up to $250,000 and restitution to his victims.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), and Philip R. Bartlett, Inspector-in-Charge, United States Postal Inspection Service, New York Division (USPIS), announced the guilty plea.
“With today’s guilty plea, Lipsitz admits to making blatantly false promises and providing fabricated shipping confirmations to thousands of customers who were in urgent need of life-saving PPE,” stated Acting United States Attorney Kasulis. “This Office will vigorously prosecute defendants who shamelessly seek to profit from an unprecedented national crisis like the COVID-19 pandemic.”
“As our nation was getting its initial glimpse into the COVID-19 Pandemic that was wreaking havoc on our communities and way of life, Kevin Lipsitz took the opportunity to capitalize and profit from people’s fears,” stated HSI Special Agent-in-Charge Fitzhugh. “Lipsitz advertised and sold PPE at exorbitant prices to vulnerable people who were willing to do almost anything to keep themselves and families safe. Working with our partners at the United States Attorney’s Office, Eastern District of New York, the FBI, and the U. S. Postal Inspection Service, HSI New York will continue to pursue those in our society who seek to enrich themselves at the expense of those around them.”
“At one of the worse times this country has seen, Mr. Lipsitz devised a scheme to not only price-gouge, but steal from those who needed much sought after PPE supplies. During times of crisis, our citizens must join together for the greater good. His conduct is shameful and he will now pay the price for his greed,” stated USPIS Inspector-in-Charge Bartlett.
According to court filings and facts presented during the plea proceeding, Lipsitz operated SuperGoodDeals.com Inc. (SGD), an online storefront that was based in Staten Island and sold various types of merchandise to customers across the United States. Between March 2020 and May 2020, as the COVID-19 pandemic swept through the United States, Lipsitz accumulated huge quantities of PPE, including surgical masks and N-95 and KN-95 filtering facepiece respirators. During that same time period, Lipsitz took advantage of the increased public demand for medical equipment by making false statements to thousands of customers regarding SGD’s inventory and ability to quickly fill and ship orders of PPE. For example, Lipsitz prominently featured statements on the SGD website that customers could “pay today” and that their orders would “ship tomorrow.” After customers placed orders relying on these statements, Lipsitz would issue false same-day shipping confirmations, which included tracking numbers that customers could purportedly use to monitor the shipment of their orders. Despite these promises, Lipsitz did not fulfill orders for PPE on the promised timeline for hundreds of customers. In addition, Lipsitz further took advantage of the demand for PPE by selling it at large markups, ranging from 150 percent to over 500 percent above what he paid for the goods.
The government’s case is being handled by the Office’s Business & Securities Fraud and International Narcotics & Money Laundering Sections. Assistant United States Attorneys Julia Nestor and Andrew Wang are in charge of the prosecution.
The Defendant:
KEVIN JAY LIPSITZ
Age: 62
Staten Island, New YorkE.D.N.Y. Docket No. 20-CR-394 (KAM)
New York Accountant Pleads Guilty to Conspiracy to Defraud the United StatesRead the Press Release
A New York certified public accountant pleaded guilty today to conspiring with a small business owner to defraud the IRS.
According to court documents, John Savignano, of White Plains, conspired with co-defendant Rocco Manzione, who owned and operated several companies that sold concrete, to evade the assessment of individual income taxes. For the tax years 2012 through 2014, Manzione received income from his concrete companies but did not file individual returns with the IRS or pay the taxes due. In 2015, Manzione sought to borrow money in connection with the purchase of a condominium in Miami. As part of the loan application process, the financial institutions requested that Manzione supply three years of filed tax returns. Thereafter, Manzione contacted Savignano, who helped him prepare and file false individual tax returns with the IRS that substantially underreported Manzione’s true income. In total, the conspiracy caused a tax loss to the IRS of more than $400,000.
Savignano is scheduled to be sentenced on Jan. 27, 2022, and faces a maximum penalty of five years in prison. The defendant also faces a period of supervised release, restitution, and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Manzione previously pleaded guilty to tax evasion and employment tax fraud on Sept. 23.
Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and Acting U.S. Attorney Jacquelyn M. Kasulis for the Eastern District of New York made the announcement.
IRS-Criminal Investigation is investigating the case.
Trial Attorneys Brittney Campbell and Kathryn Carpenter of the Justice Department’s Tax Division are prosecuting the case.