Eastern District of New York
Press releases recorded for this federal judicial district.
Queens Sex Offender Sentenced to More Than 21 Years’ Imprisonment for Coercion and Enticement of a Minor and Distribution of Child PornographyRead the Press Release
Earlier today, in federal court in Brooklyn, Richard Palmer was sentenced to 262 months’ imprisonment by United States District Judge Carol Bagley Amon, following the defendant’s guilty plea in April 2021, to coercion and enticement of a child to engage in illegal sexual conduct and distribution of child pornography. As part of his sentence, Palmer must also serve five years’ supervised release following his imprisonment, during which time he must remain registered as a sex offender and have no unsupervised or unapproved contact with minors.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the sentence.
“Today, the defendant, a serial predator and registered sex offender, received a well-deserved, lengthy term of imprisonment for his efforts to convince a young child to engage in sexual acts by texting him thousands of obscene messages and photographs,” stated Acting United States Attorney Kasulis. “Protecting vulnerable, underage children from sexual exploitation will always be a high priority of this Office.” Ms. Kasulis extended her grateful appreciation to the FBI New York Child Exploitation and Human Trafficking Task Force for its investigative work and assistance.
According to court filings, in September 2019, an adult woman contacted the FBI and reported that Palmer had sent her unsolicited emails containing child pornography. Law enforcement subsequently conducted searches of Palmer’s residence in Maspeth, Queens, and his electronic devices. The searches revealed that Palmer had also sent thousands of text messages, including explicit and obscene photographs, to an 11-year-old child in an effort to convince that child to engage in sexual acts with him. At the time, Palmer was a registered sex offender who had been convicted in 2010 in Queens of attempted promotion of a sexual performance by a child.
This prosecution is part of Project Safe Childhood, a nationwide initiative led by the Department of Justice to combat the epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Assistant United States Attorney Devon Lash is in charge of the prosecution.
The Defendant:
RICHARD PALMER
Age: 40
Maspeth, QueensE.D.N.Y. Docket No. 19-CR-556 (CBA)
United States Sells Unique Wu-Tang Clan Album Forfeited by Convicted Hedge Fund Manager Martin ShkreliRead the Press Release
Proceeds from the Sale Will be Applied to Forfeiture Money Judgment Against Shkreli
United States Sells Unique Wu-Tang Clan Album Forfeited by Convicted Hedge Fund Manager Martin Shkreli
Earlier today, the United States sold the sole copy of the Wu-Tang Clan album “Once Upon a Time in Shaolin” (the “Album”) which had previously been ordered to be forfeited as a substitute asset in connection with the approximately $7.4 million forfeiture money judgment (Forfeiture Money Judgment) entered against Shkreli at his March 2018 sentencing. Proceeds from the sale of the Album will be applied to satisfy the outstanding balance owed on the Forfeiture Money Judgment. The contract of sale contains a confidentiality provision that protects information relating to the buyer and price.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, announced the sale of the Album.
“Through the diligent and persistent efforts of this Office and its law enforcement partners, Shkreli has been held accountable and paid the price for lying and stealing from investors to enrich himself. With today’s sale of this one-of-a-kind album, his payment of the forfeiture is now complete,” stated Acting U.S. Attorney Kasulis. Ms. Kasulis acknowledged the significant efforts of the U.S. Marshals Service and, in particular, the work of the U.S. Marshals Service’s Office of General Counsel and the Complex Asset Unit of the agency’s Asset Forfeiture Division, as well as assistance provided by the Department of Justice’s Civil Division, Commercial Litigation Branch.
Shkreli was the founder and managing member of hedge funds MSMB Capital Management LP and MSMB Healthcare Management LP and the former Chief Executive Officer of Retrophin Inc. (“Retrophin”), a publicly traded biopharmaceutical company. Following a six-week trial in federal court in Brooklyn, Shkreli was convicted in August 2017 of two counts of securities fraud and one count of securities fraud conspiracy for orchestrating a series of schemes to defraud investors in the hedge funds and to manipulate the price and trading volume of Retrophin’s stock. United States District Judge Kiyo A. Matsumoto sentenced Shkreli to seven years’ imprisonment, to be followed by three years’ supervised release, and ordered him to pay the Forfeiture Money Judgment, approximately $388,000 in restitution and a $75,000 fine. Judge Matsumoto also ordered Shkreli to forfeit the Album and other substitute assets to satisfy the Forfeiture Judgment.
Shkreli’s conviction and sentence, including the imposition of the Forfeiture Money Judgment, were affirmed by the U.S. Court of Appeals for the Second Circuit in July 2019. Following the U.S. Supreme Court’s denial of Shkreli’s request for further review of his conviction and sentence, the government seized the Album and other assets owed by Shkreli.
At the time Shkreli purchased the Album in 2015, it was marketed as “both a work of art and an audio artifact.” The Album includes a hand-carved nickel-silver box as well as a leather-bound manuscript containing lyrics and a certificate of authenticity. The Album is subject to various restrictions, including those relating to the duplication of its sound recordings. In September 2017, just weeks after his conviction but before the district court-imposed forfeiture, Shkreli attempted to sell the Album through an on-line auction.
Forfeiture matters related to Shkreli’s sentence were handled by Assistant United States Attorneys Laura D. Mantell and Claire S. Kedeshian of the newly formed Asset Recovery Section in the Office’s Criminal Division. Acting U.S. Attorney Kasulis and Assistant United States Attorneys Alixandra E. Smith and G. Karthik Srinivasan (now an Assistant United States Attorney in the Western District of Texas) were in charge of the prosecution of Shkreli, and defended his conviction and sentence on appeal.
Rare Cuneiform Tablet Bearing Portion of the Epic of Gilgamesh Forfeited to the United StatesRead the Press Release
United States District Judge Ann M. Donnelly entered an order yesterday forfeiting a rare cuneiform tablet bearing a portion of the epic of Gilgamesh, a Sumerian poem considered one of the world’s oldest works of literature. Known as the Gilgamesh Dream Tablet, it originated in the area of modern-day Iraq and entered the United States contrary to federal law. An international auction house (the “Auction House”) later sold the tablet to Hobby Lobby Stores, Inc. (“Hobby Lobby”), a prominent arts-and-crafts retailer based in Oklahoma City, Oklahoma, for display at the Museum of the Bible (the “Museum”). Law enforcement agents seized the tablet from the Museum in September 2019.
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 Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), announced the forfeiture decree.
“This forfeiture represents an important milestone on the path to returning this rare and ancient masterpiece of world literature to its country of origin,” stated Acting U.S. Attorney Kasulis. “This Office is committed to combating the black-market sale of cultural property and the smuggling of looted artifacts.”
“Forfeiture of the Gilgamesh Dream Tablet demonstrates the Department’s continued commitment to eliminating smuggled cultural property from the U.S. art market,” stated Assistant Attorney General Polite. “Thwarting trade in smuggled goods by seizing and forfeiting an ancient artifact shows the department’s dedication to using all available tools, including forfeiture, to ensure justice.”
“The trafficking of cultural property and art is a lucrative criminal enterprise that transnational criminal organizations exploit to make a profit, regardless of its destructive consequence to cultures around the globe,” stated HSI Special Agent-in-Charge Fitzhugh. “HSI continues to partner in art and antiquities investigations to ensure looted pieces are no longer trafficked through commerce for an illicit profit, because the cultural value of this tablet that travelled the world under false provenance exceeds any monetary value.”
A 12-tablet Babylonian version of the Gilgamesh epic, written in Akkadian, was discovered in 1853 in the ruins of the library of the Assyrian King Assur Banipal in Nineveh (located in modern-day northern Iraq). The events in the epic revolve around King Gilgamesh of Uruk (located in modern-day southern Iraq).
The government’s investigation showed that in 2003, a U.S. antiquities dealer (the “Antiquities Dealer”) purchased the Gilgamesh Dream Tablet, encrusted with dirt and unreadable, from a family member of a coin dealer in London. The Antiquities Dealer and a U.S. cuneiform expert shipped the tablet into the United States by international post without declaring formal entry. After the tablet was imported and cleaned, experts in cuneiform recognized it as bearing a portion of the Gilgamesh epic in which the protagonist describes his dreams to his mother. The protagonist’s mother interprets the dreams as foretelling the arrival of a new friend. She tells her son, “You will see him and your heart will laugh.” The names of the hero, Gilgamesh, and the character who becomes his friend, Enkidu, are replaced in this tablet with the names of deities Sin and Ea. The tablet measures approximately 6-inches by 5-inches and is written in the Akkadian language.
As alleged in the government’s amended complaint, in 2007, the Antiquities Dealer sold the Gilgamesh Dream Tablet with a false provenance letter that stated the tablet had been inside a box of miscellaneous ancient bronze fragments purchased in an auction in 1981. This false letter traveled with the tablet as it was sold several times in different countries, and a later owner provided the letter to the Auction House in London. In 2014, the Auction House sold the Gilgamesh Dream Tablet to Hobby Lobby in a private sale and an Auction House employee carried it on a flight from London to the United States and then transferred it to New York. Hobby Lobby consented to the tablet’s forfeiture based on the tablet’s illegal importations into the United States in 2003 and 2014.
The government’s case is being prosecuted by Assistant United States Attorney Sylvia Shweder and Trial Attorney Ann Brickley of the Department of Justice’s Money Laundering and Asset Recovery Section (MLARS).
The Department of Justice has a remission process for judicially forfeited property. An interested party may submit a petition to the U.S. Attorney for the Eastern District of New York. The U.S. Attorney then will forward a package to MLARS containing the petition, the seizing agency’s report and recommendation, and its own recommendation as to how MLARS should proceed. MLARS makes a determination about the petitions based on the papers received, and in accordance with the governing law and department policies.
E.D.N.Y. Docket No.: 20-CV-2222 (AMD)
Rare Cuneiform Tablet Bearing Portion of Epic of Gilgamesh Forfeited to United StatesRead the Press Release
The U.S. District Court for the Eastern District of New York ordered the forfeiture of a rare cuneiform tablet bearing a portion of the epic of Gilgamesh, a Sumerian poem considered one of the world’s oldest works of literature.
Known as the Gilgamesh Dream Tablet, it originated in the area of modern-day Iraq and entered the United States contrary to federal law. An international auction house (the Auction House) later sold the tablet to Hobby Lobby Stores Inc. (Hobby Lobby), a prominent arts-and-crafts retailer based in Oklahoma City, Oklahoma, for display at the Museum of the Bible (the Museum). Law enforcement agents seized the tablet from the Museum in September 2019.
“Forfeiture of the Gilgamesh Dream Tablet demonstrates the department’s continued commitment to eliminating smuggled cultural property from the U.S. art market,” said Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division. “Thwarting trade in smuggled goods by seizing and forfeiting an ancient artifact shows the department’s dedication to using all available tools, including forfeiture, to ensure justice.”
“This forfeiture represents an important milestone on the path to returning this rare and ancient masterpiece of world literature to its country of origin,” said Acting U.S. Attorney Jacquelyn M. Kasulis for the Eastern District of New York. “This office is committed to combating the black-market sale of cultural property and the smuggling of looted artifacts.”
“The trafficking of cultural property and art is a lucrative criminal enterprise that transnational criminal organizations exploit to make a profit, regardless of its destructive consequence to cultures around the globe,” said Special Agent in Charge Peter C. Fitzhugh of Homeland Security Investigations (HSI), New York. “HSI continues to partner in art and antiquities investigations to ensure looted pieces are no longer trafficked through commerce for an illicit profit, because the cultural value of this tablet that travelled the world under false provenance exceeds any monetary value.”
As alleged in the government’s amended complaint, in 2003, a U.S. antiquities dealer (the Antiquities Dealer) purchased the Gilgamesh Dream Tablet, encrusted with dirt and unreadable, from the family member of a London coin dealer. The Antiquities Dealer and a U.S. cuneiform expert shipped the tablet into the United States by international post without declaring the contents as required. After the tablet was imported and cleaned, experts in cuneiform recognized it as bearing a portion of the Gilgamesh epic. The tablet measures approximately 6 inches by 5 inches and is written in the Akkadian language.
The amended complaint further alleged that, in 2007, the Antiquities Dealer sold the Gilgamesh Dream Tablet with a false provenance letter stating that the tablet had been inside a box of miscellaneous ancient bronze fragments purchased in a 1981 auction. This false letter traveled with the tablet as it was sold several times in different countries, and a later owner provided the letter to the Auction House in London. In 2014, the Auction House sold the Gilgamesh Dream Tablet to Hobby Lobby in a private sale and an Auction House employee carried it on a flight from London to the United States and then transferred it to New York. Hobby Lobby consented to the tablet’s forfeiture based on the tablet’s illegal importations into the United States in 2003 and 2014.
HSI’s Cultural Property, Art and Antiquities Unit is investigating the case.
Trial Attorney Ann Brickley of the Criminal Division’s Money Laundering and Asset Recovery Section (MLARS) and Assistant U.S. Attorney Sylvia Shweder of the U.S. Attorney’s Office for the Eastern District of New York handled this matter.
The Department of Justice has a remission process for judicially forfeited property. An interested party may submit a petition to the U.S. Attorney for the Eastern District of New York. The U.S. Attorney then will forward a package to MLARS containing the petition, the seizing agency’s report and recommendation, and its own recommendation as to how MLARS should proceed. MLARS makes a determination about the petitions based on the papers received, and in accordance with the governing law and department policies.
Queens Man Pleads Guilty to Sexually Exploiting Children and Possessing Child PornographyRead the Press Release
Earlier today, in federal court in Brooklyn, Orlando Lopez pleaded guilty to nine counts of child exploitation and one count of possession of child pornography. The proceeding took place before United States District Judge Eric R. Komitee. When sentenced, Lopez faces up to 50 years’ imprisonment on each count of production of child pornography, as well as forfeiture, restitution and a fine.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, announced the guilty plea.
“With today’s guilty plea, the defendant admits to preying on vulnerable young children for the cruel purpose of sexually exploiting them, and he also admits to possessing thousands of pornographic videos and photographs depicting his depraved acts of sexual abuse.” stated Acting United States Attorney Kasulis. “While the defendant’s admission of guilt cannot undo the terrible harm he has inflicted, it does provide assurance that this Office and its law enforcement partners remain steadfast in their commitment to prosecuting dangerous predators like the defendant to the fullest extent of the law.”
Ms. Kasulis expressed her grateful appreciation to the Federal Bureau of Investigation, New York Field Office, the New York City Police Department and the Queens County District Attorney’s Office for their assistance with the case.
According to court filings and admissions made in court at the time he entered his plea, Lopez created child pornography by sexually abusing children and taking photographs and videos of the abuse. Many of the children Lopez targeted lived with their families near Lopez’s residence in Queens and were between the ages of two and 10 years old when he sexually abused them. In order to gain access to his victims, Lopez attempted to befriend their parents. Law enforcement recovered thousands of photos and videos from Lopez’s residence depicting him engaging in sexual activity with children.
This prosecution is part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The government’s case is being prosecuted by Assistant United States Attorney Tanya Hajjar.
The Defendant:
ORLANDO LOPEZ
Age: 66
Jamaica, QueensE.D.N.Y. Docket No. 20-CR-52 (EK)
United States Seizes Funeral Scrolls and Manuscripts Taken from Pre-Holocaust Jewish Communities in Eastern EuropeRead the Press Release
Jacquelyn Kasulis, Acting United States Attorney for the Eastern District of New York, and Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), announced today the seizure of 17 Jewish Funeral Scrolls, Pinkas Manuscripts (“Scrolls and Manuscripts”) and Community Records that had been taken from Jewish communities in Romania, Hungary, Ukraine and Slovakia during World War II. The Scrolls and Manuscripts, which date from the mid-19th century to World War II, were confiscated from Jewish communities and disappeared during the Holocaust. The artifacts were found through a Brooklyn auction house that offered them for sale, as well as a consigner and a purchaser. Three additional artifacts are believed to be in Israel and one in upstate New York.
“The Scrolls and Manuscripts that were illegally confiscated during the Holocaust contain priceless historical information that belongs to the descendants of families that lived and flourished in Jewish communities before the Holocaust. This Office hopes that today’s seizure will contribute to the restoration of pre-Holocaust history in Eastern Europe.” stated Acting U.S. Attorney Kasulis. “I commend the efforts of this Office’s Civil Division and HSI in recovering these important religious artifacts.”
“The recovery of these 19th century Judaica Manuscripts and Scrolls looted during the Holocaust from Romania, Hungary, Slovakia, and Ukraine in the midst of our world’s darkest of times, is the culmination of an extensive HSI cultural property investigation, and we are fortunate to be part of the team that is able to return these artifacts to their rightful Jewish communities,” stated HSI Special Agent-in-Charge Fitzhugh. “The HSI NY Cultural Property, Art & Antiquities Investigations unit works tirelessly with the United States Attorney’s Office for the Eastern District of New York to investigate the looting, theft and sale of critical pieces of history, and will continue to bring to justice the individuals and transnational criminal organizations who profit from the trafficking of these cultural treasures.”
As set forth in the search warrant affidavit, in February 2021, law enforcement learned that an auction house located in the Eastern District of New York had offered for sale 21 Manuscripts and Scrolls originating from Jewish communities that existed before World War II and the Holocaust. The members of those communities from which the Scrolls and Manuscripts were taken had been gathered in ghettos, robbed of their property and deported to Nazi death camps, where the majority of them were killed. After the end of World War II, surviving members of the communities returned to find their homes ransacked and buildings emptied of property. Among the items that were stolen were the Scrolls and Manuscripts that contained information related to the Jewish communities from as early as 1840 and up through and including the Holocaust. These Scrolls and Manuscripts contained prayers for the dead, memorial pages and/or the names of deceased members of the Jewish communities, operating rules of the society, society member payments, obligations, society regulations, the identity of society religious leaders, and, in some cases, the names of the society members who were deported by the Nazis to the Auschwitz concentration camp. The Manuscripts and Scrolls were confiscated by individuals who had no right to do so during and after the Holocaust. Absent any provenance or documentation of conveyance from any survivors of those communities, there is no legitimate means by which the Manuscripts and Scrolls could have been imported into the United States.
The government’s case is being handled by Assistant United States Attorney Artemis Lekakis of the Office’s Civil Division and the investigation was conducted by Department of Homeland Security Agents Megan Buckley and Robert Mancene.
E.D.N.Y. Docket No.: 21-MJ-837 (PK)
Nine Individuals Charged in Superseding Indictment with Conspiring to Act as Illegal Agents of the People’s Republic of ChinaRead the Press Release
A superseding indictment was filed today in federal court in Brooklyn charging nine defendants with acting and conspiring to act in the United States as illegal agents of the People’s Republic of China (PRC) without prior notification to the Attorney General, and engaging and conspiring to engage in interstate and international stalking. Two defendants, Tu Lan and Zhu Feng, were also charged with obstruction of justice and conspiracy to obstruct justice arising out of the same course of conduct. The defendants, allegedly acting at the direction and under the control of PRC government officials, conducted surveillance of and engaged in a campaign to harass, stalk and coerce certain residents of the United States to return to the PRC as part of a global, concerted and extralegal repatriation effort known as “Operation Fox Hunt.” In addition to the six defendants previously charged in a related criminal complaint in October 2020 and a related indictment in May 2021, the superseding indictment alleges that Tu Lan, a new defendant who was employed as a prosecutor with the Hanyang People’s Procuratorate, traveled to the United States, directed the harassment campaign and ordered a coconspirator to destroy evidence to obstruct the criminal investigation.
Defendants Tu Lan, Hu Ji, Li Minjun, Zhai Yongqiang and Zhu Feng remain at large. Co-defendants Michael McMahon, Zheng Congying and Zhu Yong will be arraigned in the Eastern District of New York at a later date. The name of the ninth defendant remains under seal.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York; Mark J. Lesko, Acting Assistant Attorney General for National Security; George M. Crouch, Jr., Special Agent-in-Charge, Federal Bureau of Investigation, Newark Field Office (FBI); Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI); and Keith Byrne, Special Agent-in-Charge, U.S. Department of State’s Diplomatic Security Service, New York Field Office (DSS), announced the superseding indictment.
“As alleged, the defendants, acting as agents of the PRC, carried out an illegal and clandestine campaign to harass and threaten targeted U.S. residents in order to force them to return to the PRC. Unregistered, roving agents of a foreign power are not permitted to engage in secret surveillance of U.S. residents on American soil, and their illegal conduct will be met with the full force of U.S. law,” stated Acting U.S. Attorney Kasulis. “To the extent the PRC seeks to repatriate its citizens to the PRC, its agents are required to register with the Attorney General of the United States, coordinate with U.S. officials, and adhere to U.S. laws and protocols.” Ms. Kasulis also extended her thanks and appreciation to the FBI’s Newark and Los Angeles field offices for their work on the case.
“Law enforcement officials around the world act according to a professional code of conduct,” stated Acting Attorney General Lesko. “They act to enforce the law, not to violate it in such an egregious manner. That a prosecutor and police officer not only directed and participated in a criminal scheme on U.S. soil, but then attempted to cover it up, is an affront to justice of the highest order.”
“Today's announcement serves to highlight the efforts of the FBI and its law enforcement partners to tirelessly and aggressively continue to utilize all available investigative tools and methods at their disposal to combat any illegal intrusions by the Chinese government to unilaterally undermine our economy and our free markets, stated FBI Special Agent-in-Charge Crouch, Newark Field Office. “The FBI remains committed to holding actors from the People's Republic of China accountable when they direct criminal activity on U.S. soil. Further, the FBI will vigorously defend the American ideals of freedom and the rule of law against any foreign malign influence actors.”
“HSI, with its law enforcement partners, will outfox attempts to circumvent our laws, undermine our national security, and target U.S. residents,” stated HSI Special Agent-in-Charge Fitzhugh. “The defendants will now face the true justice they denied their victims.”
“This is a perfect illustration of the domestic and global reach of the Diplomatic Security Service and our ability to partner with U.S. prosecutorial and law enforcement agencies on complex international, multi-jurisdictional cases,” stated DSS Special Agent-in-Charge Byrne. “DSS will continue to work closely with the United States Attorney’s Office and its law enforcement colleagues to detect and deter similar illegal activities that occur at home and abroad.”
In and around 2012 and 2014, the PRC government caused the International Criminal Police Organization (also known as “Interpol”), an inter-governmental law enforcement organization, to issue “Red Notices” for John Doe #1 and his wife, Jane Doe #1. According to the Red Notices, John Doe #1 was wanted by the PRC government for “embezzlement, abuse of power [and] acceptance of bribes” which carried a maximum possible penalty of death under PRC law. Jane Doe #1 was wanted by the PRC government for “accepting bribes” which carried a maximum possible penalty of life imprisonment under PRC law.
As alleged in the indictment, the nine defendants participated in an international campaign to threaten, harass, surveil and intimidate John Doe #1 and his family, in order to force John Doe #1 and Jane Doe #1 to return to the PRC as part of “Operation Fox Hunt,” a PRC Ministry of Public Security initiative to locate and repatriate alleged Chinese “fugitives” who had fled to foreign countries, including the United States. Instead of operating with the approval and coordination of the U.S. government, PRC government officials carrying out Operation Fox Hunt traveled to the United States and directed non-official operatives in the United States to engage in violations of U.S. criminal law. Specifically, between approximately 2016 and 2019, PRC government officials, including defendant Tu Lan, a PRC prosecutor with the Hanyang People’s Procuratorate, and Hu Ji, a PRC police officer with the Wuhan Public Security Bureau, traveled to the United States and directed other defendants to engage in unsanctioned and illegal conduct on behalf of the PRC to coerce the targeted victims to return to the PRC.
As further alleged in the superseding indictment, a centerpiece of this criminal scheme was an April 2017 effort, directed by PRC officials Tu Lan and Hu Ji, to transport John Doe #1’s elderly father from the PRC to the United States to convey a threat to John Doe #1 that his family in the PRC would be harmed if he did not return to the PRC. At the direction of Tu Lan, Hu Ji and others, several defendants worked to investigate, surveil and locate John Doe #1 and his wife. Tu Lan then traveled to the United States along with John Doe #1’s father and a medical doctor, Li Minjun. While in the United States, Tu Lan directed several conspirators to surveil John Doe #1 and his family so the defendants would know where to bring John Doe #1’s father to deliver the demand that John Doe #1 return to the PRC. Afterwards, Tu Lan returned to the PRC, where she continued to supervise the operation with Hu Ji and other PRC officials, directed other U.S.-based conspirators to continue stalking John Doe #1 and then ordered the return of John Doe #1’s father to the PRC after their attempts to render John Doe #1 and Jane Doe #1 were unsuccessful. Zhu Feng, Hu Ji and Zhu Yong worked with McMahon, a private investigator, to gather intelligence about and locate John Doe #1 and Jane Doe #1. To evade detection and frustrate a criminal investigation of their conduct, Tu Lan allegedly directed one of the conspirators to “delete all the chat content” between the conspirators. Subsequently, between 2017 and 2019, other defendants continued to harass and stalk the victims at the direction of the PRC government.
For example, on September 4, 2018, two defendants drove to the New Jersey residence of John Doe #1 and Jane Doe #1 and pounded on the front door. The two defendants attempted to force open the door to the residence, then left a note at the residence that stated, “If you are willing to go back to the mainland and spend 10 years in prison, your wife and children will be all right. That’s the end of this matter!”
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 10 years’ imprisonment for acting as unregistered agents of the PRC, five years’ imprisonment for conspiring to act as unregistered agents of the PRC, five years’ imprisonment for interstate stalking, and five years’ imprisonment for conspiring to engage in interstate stalking. Defendants Tu Lan and Zhu Feng, who are separately charged with obstruction of justice and conspiracy to obstruct justice, face a maximum sentence of 20 years in prison if convicted of either of those crimes.
The government’s case is being handled by the Office’s National Security and Cybercrime Section. Assistant United States Attorneys Craig R. Heeren, J. Matthew Haggans and Ellen H. Sise are in charge of the prosecution, with assistance from Trial Attorney Scott A. Claffee of the National Security Division’s Counterintelligence and Export Control Section.
New Defendants:
TU LAN
Age: 50
People’s Republic of ChinaZHAI YONGQIANG
Age: 46
California; People’s Republic of ChinaDefendants Previously Indicted:
HU JI
Age: 46
People’s Republic of ChinaLI MINJUN
Age: 65
People’s Republic of ChinaZHU FENG
Age: 34
Queens, New York; People’s Republic of ChinaMICHAEL MCMAHON
Age: 53
Mahwah, New JerseyZHENG CONGYING
Age: 24
Brooklyn, New YorkZHU YONG, also known as “Jason Zhu”
Age: 64
Norwich, ConnecticutE.D.N.Y. Docket No. 21-CR-265 (S-1) (PKC)
Department of Justice Announces Launch of Firearms Trafficking Strike Forces to Crack Down on Sources of Crime GunsRead the Press Release
BROOKLYN, NY - The U.S. Department of Justice today launched five cross-jurisdictional strike forces to help reduce gun violence by disrupting illegal firearms trafficking in key regions across the country. Leveraging existing resources, the regional strike forces will better ensure sustained and focused coordination across jurisdictions and help stem the supply of illegally trafficked firearms from source cities, through other communities, and into five key market regions: New York, Chicago, Los Angeles, the San Francisco Bay Area/Sacramento Region and Washington, D.C.
Each strike force region will be led by designated United States Attorneys, who will collaborate with the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) and with state and local law enforcement partners within their own jurisdiction (where firearms are used in crimes) as well as law enforcement partners in areas where illegally trafficked guns originate. These officials will use the latest data, evidence, and intelligence from crime scenes to identify patterns, leads, and potential suspects in violent gun crimes.
“All too often, guns found at crime scenes come from hundreds or even thousands of miles away. We are redoubling our efforts as ATF works with law enforcement to track the movement of illegal firearms used in violent crimes. These strike forces enable sustained coordination across multiple jurisdictions to help disrupt the worst gun trafficking corridors,” stated Attorney General Merrick B. Garland. “The Department of Justice will use all of its tools – enforcement, prevention, intervention, and investment – to help ensure the safety of our communities – the department’s highest priority.”
According to gun trace data, the vast majority of firearms recovered in New York City originate outside the state and are illegally trafficked into New York. The new strike force, led by Audrey Strauss, the U.S. Attorney for the Southern District of New York, and Jacquelyn Kasulis, the Acting U.S. Attorney for the Eastern District of New York, will help ensure sustained and focused coordination between law enforcement and prosecutors in New York City with their counterparts in locations where many of the firearms originate.
“Gun violence has taken a terrible, unacceptable toll on our communities, and it must be stopped,” stated Acting U.S. Attorney Jacquelyn M. Kasulis. “Stemming the flow of illegal guns into New York City is critical to eradicating gun violence in our city. We are committed to working with our federal and state partners to investigate and prosecute gun trafficking to the fullest extent of the law.”
“Disrupting the flow of guns into New York City is an important part of our anti-violence efforts,” stated U.S. Attorney Audrey Strauss. We look forward to working with our federal and state partners to investigate and prosecute gun trafficking cases. Because many of the firearm source locations for New York City overlap with the source locations for firearms recovered in the District of Columbia, we will coordinate our efforts with our D.C. counterparts.”
The strike forces represent one important, concrete step in implementing the Department’s Comprehensive Violent Crime Reduction Strategy, which was announced on May 26, 2021. The comprehensive strategy supports local communities in preventing, investigating, and prosecuting gun violence and other violent crime—and requires U.S. Attorneys’ offices to work with federal, state, local and tribal law enforcement, as well as the communities they serve, to address the most significant drivers of violence in their districts. In guidance to federal agents and prosecutors as part of that comprehensive strategy, the Deputy Attorney General made clear that firearms traffickers providing weapons to violent offenders are an enforcement priority across the country.
Former Advisor to Presidential Candidate Among Three Defendants Charged with Acting as Agents of a Foreign GovernmentRead the Press Release
BROOKLYN, NY – A seven-count indictment was unsealed today in federal court in Brooklyn charging Thomas Joseph Barrack, Matthew Grimes, and Rashid Sultan Rashid Al Malik Alshahhi, also known as “Rashid Al Malik” and “Rashid Al‑Malik,” a citizen of the United Arab Emirates (UAE), with acting and conspiring to act as agents of the UAE between April 2016 and April 2018. The indictment charges conduct relating to the defendants’ unlawful efforts to advance the interests of the UAE in the United States at the direction of senior UAE officials by influencing the foreign policy positions of the campaign of a candidate (the “Candidate”) in the 2016 United States Presidential Election (the “Campaign”) and, subsequently, the foreign policy positions of the United States government in the incoming administration, as well as seeking to influence public opinion in favor of UAE interests. The indictment also charges Barrack with obstruction of justice and making multiple false statements during a June 20, 2019 interview with federal law enforcement agents.
Barrack and Grimes were arrested this morning in California and are scheduled to make their initial appearances this afternoon before United States Magistrate Judge Patricia Donahue at the federal courthouse in Los Angeles. Alshahhi remains at large.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Mark J. Lesko, Acting Assistant Attorney General of the Justice Department’s National Security Division, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the arrests and indictment.
“As alleged, the defendants, using their positions of power and influence in a presidential election year, engaged in a conspiracy to illegally advance and promote the interests of the United Arab Emirates in this country, in flagrant violation of their obligation to notify the Attorney General of their activities and in derogation of the American people’s right to know when a foreign government seeks to influence the policies of our government and our public opinion,” stated Acting United States Attorney Kasulis. “These arrests serve as a warning to those who act at the direction of foreign governments without disclosing their actions, as well as those who seek to mislead investigators about their actions, that they will be brought to justice and face the consequences.”
Ms. Kasulis expressed her appreciation to the United States Attorney’s Office for the Central District of California, the United States Attorney’s Office for the District of Colorado and the FBI’s Los Angeles and Denver Field Offices for their assistance.
“The defendants repeatedly capitalized on Barrack’s friendships and access to a candidate who was eventually elected President, high-ranking campaign and government officials, and the American media to advance the policy goals of a foreign government without disclosing their true allegiances,” stated Acting Assistant Attorney General Lesko. “The conduct alleged in the indictment is nothing short of a betrayal of those officials in the United States, including the former President. Through this indictment, we are putting everyone—regardless of their wealth or perceived political power—on notice that the Department of Justice will enforce the prohibition of this sort of undisclosed foreign influence.”
“American citizens have a right to know when foreign governments, or their agents, are attempting to exert influence on our government. This is especially important to Americans during a Presidential election year, and the laws on the books were created to protect our nation from such untoward influence. This case is about secret attempts to influence our highest officials, and when that corrupt behavior was discovered, we allege Mr. Barrack went even further, obstructing and lying to FBI special agents. In case it needs repeating, each of those bad choices is a federal felony, and each now comes with significant consequences - the first being today's indictment,” stated FBI Assistant Director-in-Charge Sweeney.
Between April 2016 and November 2016, Barrack served as an informal advisor to the Campaign of the Candidate in the 2016 United States Presidential Election. Between November 2016 and January 2017, Barrack served as Chairman of the Presidential Inaugural Committee. Beginning in January 2017, Barrack informally advised senior United States government officials on issues related to United States foreign policy in the Middle East. Barrack also sought appointment to a senior role in the United States government, including the role of Special Envoy to the Middle East. Barrack served as the Executive Chairman of a global investment management firm headquartered in Los Angeles, and Grimes was employed at the firm and reported directly to Barrack. During the relevant time period, Alshahhi worked as an agent of the UAE and was in frequent contact with Barrack and Grimes, including numerous in-person meetings in the United States and the UAE.
As alleged in the indictment, the defendants used Barrack’s status as a senior outside advisor to the Campaign and, subsequently, to senior United States government officials, to advance the interests of and provide intelligence to the UAE while simultaneously failing to notify the Attorney General that their actions were taken at the direction of senior UAE officials. Barrack – directly and through Alshahhi and Grimes – was regularly and repeatedly in contact with the senior leadership of the UAE government. On multiple occasions, Barrack referred to Alshahhi as the UAE’s “secret weapon” to advance its foreign policy agenda in the United States.
Barrack, Alshahhi and Grimes allegedly took numerous steps in the United States to advance the interests of the UAE. For example, in May 2016, Barrack inserted language praising the UAE into a Campaign speech to be delivered by the Candidate about United States energy policy in May 2016 and emailed an advance draft of the speech to Alshahhi for delivery to senior UAE officials. Similarly, throughout 2016 and 2017, the defendants sought and received direction and feedback, including talking points, from senior UAE officials in connection with national press appearances Barrack used to promote the interests of the UAE. After one appearance in which Barrack repeatedly praised the United Arab Emirates, Barrack emailed Alshahhi, “I nailed it. . . for the home team,” referring to the UAE. Barrack and Grimes also solicited direction from senior UAE officials in advance of the publication of an Op-Ed authored by Barrack and published in a national magazine in October 2016 and removed certain language at the direction of senior UAE officials, as relayed by Alshahhi.
Following the 2016 United States Presidential Election, the defendants repeatedly acted at the direction of UAE officials to influence the foreign policy positions of the incoming administration in favor of UAE interests. For example, in December 2016, Barrack met with Grimes, Alshahhi and senior UAE government officials, during which he advised them to create a “wish list” of U.S. foreign policy items that the UAE wanted accomplished in the first 100 days, six months, year and four years of the incoming administration of the United States President-Elect.
In March 2017, Barrack and his co-defendants agreed to promote the candidacy of an individual favored by senior UAE officials for the position of United States Ambassador to the UAE. In May 2017, Barrack agreed to provide Alshahhi with non-public information about the views and reactions of senior United States government officials following a White House meeting between senior United States officials and senior UAE officials.
In September 2017, Alshahhi communicated with Barrack about the opposition of the UAE to a proposed summit at Camp David to address an ongoing dispute between the State of Qatar, the UAE and other Middle Eastern governments, after which Barrack sought to advise the President of the United States against holding the Camp David summit. The summit never happened.
In furtherance of the alleged criminal conspiracy and conduct, Barrack and Grimes, with the assistance of Alshahhi, acquired a dedicated cellular telephone and installed a secure messaging application to facilitate Barrack’s communications with senior UAE officials.
Neither Alshahhi, nor Barrack nor Grimes provided the required notification to the United States Attorney General that they were acting in the United States as agents of a foreign government.
On June 20, 2019, Barrack voluntarily met with FBI special agents. During the interview, Barrack allegedly made numerous false statements, including falsely denying that Alshahhi had ever requested that he take any actions on behalf of the UAE.
The charges in the indictment are allegations, and the defendants are presumed innocent unless and until proven guilty.
The government’s case is being handled by the Office’s Public Integrity Section. Assistant United States Attorneys Nathan Reilly, Ryan Harris, Samuel Nitze and Hiral Mehta of the Eastern District of New York and Trial Attorney Matthew McKenzie from the Justice Department’s Counterintelligence and Export Control Section are in charge of the prosecution.
The Defendants:
RASHID SULTAN RASHID AL MALIK ALSHAHHI (also known as “Rashid Al Malik” and “Rashid Al‑Malik”)
Age: 43
United Arab EmiratesTHOMAS JOSEPH BARRACK
Age: 74
Santa Monica, CaliforniaMATTHEW GRIMES
Age: 27
Aspen, ColoradoE.D.N.Y. Docket No. 21-CR-371 (BMC)
Former Advisor to Presidential Candidate Among Three Defendants Charged with Acting as Agents of a Foreign GovernmentRead the Press Release
A seven-count indictment was unsealed today in a New York federal court relating to the defendants’ unlawful efforts to advance the interests of the United Arab Emirates (UAE) in the United States at the direction of senior UAE officials by influencing the foreign policy positions of the campaign of a candidate in the 2016 U.S. presidential election and, subsequently, the foreign policy positions of the U.S. government in the incoming administration, as well as seeking to influence public opinion in favor of UAE interests.
Thomas Joseph Barrack, 74, of Santa Monica, California; Matthew Grimes, 27, of Aspen, Colorado; and Rashid Sultan Rashid Al Malik Alshahhi, aka Rashid Al Malik and Rashid Al‑Malik, 43, a UAE national, are accused of acting and conspiring to act as agents of the UAE between April 2016 and April 2018. The indictment also charges Barrack with obstruction of justice and making multiple false statements during a June 20, 2019, interview with federal law enforcement agents.
“The defendants repeatedly capitalized on Barrack’s friendships and access to a candidate who was eventually elected President, high-ranking campaign and government officials, and the American media to advance the policy goals of a foreign government without disclosing their true allegiances,” said Acting Assistant Attorney General Mark Lesko of the Justice Department’s National Security Division. “The conduct alleged in the indictment is nothing short of a betrayal of those officials in the United States, including the former President. Through this indictment, we are putting everyone — regardless of their wealth or perceived political power — on notice that the Department of Justice will enforce the prohibition of this sort of undisclosed foreign influence.”
“As alleged, the defendants, using their positions of power and influence in a presidential election year, engaged in a conspiracy to illegally advance and promote the interests of the United Arab Emirates in this country, in flagrant violation of their obligation to notify the Attorney General of their activities and in derogation of the American people’s right to know when a foreign government seeks to influence the policies of our government and our public opinion,” said Acting U.S. Attorney Jacquelin M. Kasulis for the Eastern District of New York. “These arrests serve as a warning to those who act at the direction of foreign governments without disclosing their actions, as well as those who seek to mislead investigators about their actions, that they will be brought to justice and face the consequences.”
“Today’s indictment confirms the FBI’s unwavering commitment to rooting out those individuals who think they can manipulate the system to the detriment of the United States and the American people,” said Assistant Director Calvin Shivers of the FBI's Criminal Investigative Division. "Barrack is alleged to have abused his access to government officials to illegally advance the interests of foreign governments. The FBI stands in concert with our external partners to ensure all who seek to wield illegal influence are charged for their crimes.”
“American citizens have a right to know when foreign governments, or their agents, are attempting to exert influence on our government,” said Assistant Director in Charge William F. Sweeney Jr. of the FBI’s New York Field Office. “This is especially important to Americans during a presidential election year, and the laws on the books were created to protect our nation from such untoward influence. This case is about secret attempts to influence our highest officials, and when that corrupt behavior was discovered, we allege Mr. Barrack went even further, obstructing and lying to FBI special agents. In case it needs repeating, each of those bad choices is a federal felony, and each now comes with significant consequences – the first being today’s indictment.”
According to court documents, between April and November 2016, Barrack served as an informal advisor to the campaign of the candidate in the 2016 U.S. presidential election. Between November 2016 and January 2017, Barrack served as Chairman of the Presidential Inaugural Committee. Beginning in January 2017, Barrack informally advised senior U.S. government officials on issues related to U.S. foreign policy in the Middle East. Barrack also sought appointment to a senior role in the U.S. government, including the role of Special Envoy to the Middle East. Barrack served as the Executive Chairman of a global investment management firm headquartered in Los Angeles, and Grimes was employed at the firm and reported directly to Barrack. During the relevant time period, Alshahhi worked as an agent of the UAE and was in frequent contact with Barrack and Grimes, including numerous in-person meetings in the United States and the UAE.
As alleged in the indictment, the defendants used Barrack’s status as a senior outside advisor to the campaign and, subsequently, to senior U.S. government officials, to advance the interests of and provide intelligence to the UAE while simultaneously failing to notify the Attorney General that their actions were taken at the direction of senior UAE officials. Barrack – directly and through Alshahhi and Grimes – was regularly and repeatedly in contact with the senior leadership of the UAE government. On multiple occasions, Barrack referred to Alshahhi as the UAE’s “secret weapon” to advance its foreign policy agenda in the United States.
Barrack, Alshahhi and Grimes allegedly took numerous steps in the United States to advance the interests of the UAE. For example, in May 2016, Barrack inserted language praising the UAE into a campaign speech to be delivered by the candidate about U.S. energy policy in May 2016 and emailed an advance draft of the speech to Alshahhi for delivery to senior UAE officials. Similarly, throughout 2016 and 2017, the defendants sought and received direction and feedback, including talking points, from senior UAE officials in connection with national press appearances Barrack used to promote the interests of the UAE. After one appearance in which Barrack repeatedly praised the UAE, Barrack emailed Alshahhi, “I nailed it. . . for the home team,” referring to the UAE. Barrack and Grimes also solicited direction from senior UAE officials in advance of the publication of an op-ed authored by Barrack and published in a national magazine in October 2016 and removed certain language at the direction of senior UAE officials, as relayed by Alshahhi.
Following the 2016 U.S. presidential election, the defendants repeatedly acted at the direction of UAE officials to influence the foreign policy positions of the incoming administration in favor of UAE interests. For example, in December 2016, Barrack attended a meeting with Grimes, Alshahhi and senior UAE government officials, during which he advised them to create a “wish list” of U.S. foreign policy items that the UAE wanted accomplished in the first 100 days, six months, year and four years of the incoming administration of the U.S. President-elect.
In March 2017, Barrack and his co-defendants agreed to promote the candidacy of an individual favored by senior UAE officials for the position of U.S. Ambassador to the UAE. In May 2017, Barrack agreed to provide Alshahhi with non-public information about the views and reactions of senior U.S. government officials following a White House meeting between senior U.S. officials and senior UAE officials.
In September 2017, Alshahhi communicated with Barrack about the opposition of the UAE to a proposed summit at Camp David to address an ongoing dispute between the State of Qatar, the UAE and other Middle Eastern governments, after which Barrack sought to advise the President of the United States against holding the Camp David summit. The summit never happened.
In furtherance of the alleged criminal conspiracy and conduct, Barrack and Grimes, with the assistance of Alshahhi, acquired a dedicated cellular telephone and installed a secure messaging application to facilitate Barrack’s communications with senior UAE officials.
Neither Alshahhi nor Barrack nor Grimes provided the required notification to the U.S. Attorney General that they were acting in the United States as agents of a foreign government.
On June 20, 2019, Barrack voluntarily met with FBI special agents. During the interview, Barrack allegedly made numerous false statements, including falsely denying that Alshahhi had ever requested that he take any actions on behalf of the UAE.
Barrack and Grimes were arrested this morning and are scheduled to be arraigned this afternoon in the Central District of California. Alshahhi remains at large.
Assistant U.S. Attorneys Nathan Reilly, Ryan Harris, Samuel Nitze and Hiral Mehta of the Eastern District of New York and Trial Attorney Matthew McKenzie of the National Security Division’s Counterintelligence and Export Control are prosecuting the case.
The charges in the indictment are allegations, and the defendants are presumed innocent unless and until proven guilty.
MS-13 Fugitive Extradited from Guatemala to Face Charges for Killing Four Young Men in a Long Island ParkRead the Press Release
Henry Edenilson Salmeron, a member of the violent transnational criminal organization La Mara Salvatrucha, also known as the “MS-13,” and fugitive from justice, was extradited from Guatemala to the United States yesterday to face charges for his alleged participation in the April 11, 2017 murders of Justin Llivicura, Michael Lopez, Jorge Tigre and Jefferson Villalobos. Salmeron, who was originally charged in an indictment returned by a federal grand jury in Central Islip, New York, on July 12, 2017, was arrested in Guatemala City, Guatemala, on February 3, 2021, by the Transnational Anti-Gang (TAG) Unit on a provisional arrest warrant, and has been detained since then, pending his extradition to the United States. Salmeron was arraigned this afternoon before United States Circuit Judge Joseph F. Bianco and was ordered detained pending trial.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), Vincent F. DeMarco, United States Marshal for the Eastern District of New York, and Stuart J. Cameron, Acting Commissioner, Suffolk County Police Department (SCPD), announced the arrest and extradition.
“Although this defendant sought to evade answering for these horrific crimes by fleeing more than 3,000 miles from the Central Islip park where he and his fellow MS-13 gang members callously slaughtered four young men, the relentless determination of our law enforcement partners led to his capture and extradition, and he will now face justice in a courthouse that overlooks that very same park,” stated Acting U.S. Attorney Kasulis. “More than four years have passed since the victims were murdered, but we hope that today’s extradition brings some measure of comfort to the victims’ family and friends.” Acting U.S. Attorney Kasulis expressed her grateful appreciation to the investigators and analysts of the FBI’s Guatemala TAG Unit and Safe Streets Gang Unit, the members of the FBI’s Long Island Gang Task Force, and the United States Marshals Service (USMS) for their outstanding collaboration in locating and apprehending this fugitive. Ms. Kasulis also expressed thanks to Homeland Security Investigations (HSI) and the Department of Justice’s Office of International Affairs for their assistance in this case.
“Gang violence erodes the very fabric of our communities, in many cases leaving parents to fear for the lives of their children, and the average citizen to doubt their safety in the comfort of their own neighborhood,” stated FBI Assistant Director-in-Charge Sweeney. “Today’s extradition of Salmeron will now allow us to hold him accountable for the murders he’s accused of committing, and hopefully restore some faith in the community that we, too, share the same concerns and won’t stop pursuing these criminals until they all face justice for their crimes.”
“Criminals often think they can flee the United States to avoid prosecution but United States Marshals Service is determined to work with our federal and international law enforcement partners and give victims of violent crime the justice they deserve,” stated United States Marshal DeMarco.
“The extradition of violent criminals like Henry Edenilson Salmeron sends a clear and powerful message to members of MS-13 that gang activity will not be tolerated in Suffolk County,” stated SCPD Acting Commissioner Cameron. “I commend our law enforcement partners, both here and in Guatemala, for their dedication to apprehending Salmeron and bringing him back to Suffolk County to answer for these crimes and bring justice to the victims’ families.”
On the evening of April 11, 2017, two female associates of the MS-13 lured five young men, including Llivicura, Lopez, Tigre and Villalobos, to a community park in Central Islip, so that Salmeron and other MS-13 members and associates could attack and kill them. The victims were believed to be rival gang members who were disrespectful toward the MS-13. Salmeron and numerous other MS-13 members and associates met in the park where they distributed weapons and discussed the plan to kill the victims. Once the female MS-13 associates led the men to a wooded area, Salmeron and the other MS-13 members and associates surrounded, attacked and killed Llivicura, Lopez, Tigre and Villalobos, using machetes, knives, wooden clubs and an axe. The fifth intended victim escaped. The victims’ bodies were discovered the following evening.
After committing the murders, Salmeron fled to Guatemala to evade arrest and prosecution in this case. Salmeron remained a fugitive for nearly four years until he was located by the USMS and FBI, and arrested by the TAG in Guatemala City on February 3, 2021. The United States requested Salmeron’s extradition, and his formal surrender was authorized on May 10, 2021, so that he could be transported to the Eastern District of New York to face the charges pending against him.
The charges in the indictment are allegations, and the defendant is presumed innocent unless and until proven guilty. If convicted, Salmeron faces up to life in prison.
Salmeron is the ninth MS-13 member or associate to be charged publicly with the April 11, 2017 murders. Six of those defendants are pending trial and are presumed innocent until proven guilty. Josue Portillo and Freiry Martinez previously pleaded guilty and were sentenced to 55 and 50 years in prison, respectively.
Today’s extradition is the latest achievement 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, Mexico, Guatemala and Honduras, but the gang has thousands of members across the United States, comprised primarily of immigrants from Central America. With numerous branches, or “cliques,” the MS-13 is the most violent street 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, comprising agents and officers of the FBI, the Nassau County Police Department (NCPD), the SCPD, the Nassau County Sheriff’s Department, the Suffolk County Sheriff’s Office, the Suffolk County Probation 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 and Megan E. Farrell are in charge of the prosecution.
The Defendant:
HENRY EDENILSON SALMERON
Age: 22
Guatemala City, Guatemala; formerly of Brentwood, New YorkE.D.N.Y. Docket No. 16-CR-403 (JFB)
Long Island MS-13 Gang Member Sentenced to 25 Years’ Imprisonment for Murder in BrentwoodRead the Press Release
Earlier today, in federal court in Central Islip, Jerlin Villalta, a member of the Freeport Locos Salvatruchas (FLS) clique of La Mara Salvatrucha, also known as the MS-13, a transnational criminal organization, was sentenced by United States Circuit Judge Joseph F. Bianco to 25 years’ imprisonment for racketeering, including predicate acts relating to his participation in the June 3, 2016 murder of Jose Pena and a conspiracy to distribute marijuana. Villalta pleaded guilty to the charges in October 2018.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, William F. Sweeney, 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 sentence.
“Today’s sentence holds the defendant to account for his vicious stabbing of the victim who was killed for violating the depraved rules of the MS-13. It is fitting that the defendant spend decades behind bars for his participation in this cruel and intentional taking of a human life,” stated Acting U.S. Attorney Kasulis. “This Office, in partnership with the Long Island Gang Task Force, will not rest until the MS -13 gang and its violence is eliminated from our communities.”
“This sentencing will ensure that another member of MS-13, who took part in a violent, senseless murder, will be imprisoned for his actions,” stated SCPD Acting Commissioner Cameron. “The department’s incredible partnership with the FBI’s Long Island Gang Task Force and Eastern District of New York allows gang members, like Villalta, to be held accountable –while sending a message to gang leadership that we will not waver until gang violence is eradicated. I commend all the law enforcement officers, whose countless hours and dedication ensured a successful conclusion on this case.”
In 2016, Villalta and several co-conspirators, including Carlos Argueta and Elmer Alexander Lopez, decided to kill Pena, a member of the MS-13, because he was suspected of violating gang rules. Prior to the murder, Villalta, Argueta, Lopez and other MS-13 members held meetings to discuss killing Pena because they suspected that Pena had cooperated with law enforcement following his arrest in connection with his participation in the attempted murder of suspected rival gang members outside a public library in Brentwood on or about January 15, 2016, and also that Pena might be homosexual. After consulting with MS-13 leadership in El Salvador, Villalta, Argueta, Lopez and the other MS-13 members agreed to murder Pena and tasks were assigned to each of the co-conspirators to carry out the plan, including obtaining weapons and a vehicle to be used in the murder. On June 3, 2016, Villalta, Argueta, Lopez and the other MS-13 members lured Pena into a car and drove to a secluded wooded area in Brentwood on the grounds of an abandoned psychiatric hospital, where they attacked Pena, stabbing and slashing him with knives until he was dead. Pena’s body was discovered four months after his murder. Argueta and Lopez previously pled guilty to racketeering charges in connection with the Pena murder. In December 2018, Lopez was sentenced to 300 months’ imprisonment. Argueta is awaiting sentencing.
Villalta also pleaded guilty to participating in a drug conspiracy, admitting that between January 2016 and December 2016, he and other members of the FLS conspired to distribute marijuana to raise money for the MS-13.
Today’s sentencing 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, comprised primarily of immigrants from Central America. 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 and Megan E. Farrell are in charge of the prosecution.
The Defendant:
JERLIN VILLALTA (also known as “Sonic”)
Age: 24
Brentwood, New YorkE.D.N.Y. Docket No. 16-CR-403 (S-6)(JFB)
Executive of International Factoring Company Indicted for $30 Million FraudRead the Press Release
An indictment was returned in federal court in Brooklyn yesterday charging Pushpesh Kumar Baid, also known as “PK Jain,” with wire fraud conspiracy and aggravated identity theft relating to a scheme to defraud investors in an international factoring company (the “Company”) of more than $30 million. Baid, the former Business Head of the Company, was previously arrested in January 2021 on a criminal complaint and will be arraigned on the indictment at a later date.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Thomas Fattorusso, Acting Special Agent-in-Charge, Internal Revenue Service-Criminal Investigation (IRS-CI), announced the indictment.
“As alleged, Baid and his co-conspirators actively misled investors about the nature, operation and investment strategy of an international factoring company, which caused more than $30 million in losses,” stated Acting United States Attorney Kasulis. “This Office will vigorously prosecute defendants like Baid who commit fraud as part of a scheme to enrich themselves at their investors’ expense.”
“As alleged, Baid and his co-conspirators used lies and material misrepresentations to defraud an investment firm responsible for managing funds on behalf of dozens of investors. When the scheme ultimately failed, the investment firm faced losses in excess of $30 million. As today’s action should demonstrate, we are committed to bringing to justice those whose greed leads them to commit criminal financial fraud,” stated FBI Assistant Director-in-Charge Sweeney.
“Regardless of how sophisticated the scheme or what it is called, simply put, Baid stole millions of dollars from his clients who put their trust in him,” stated IRS-CI Special Agent-in-Charge Fattorusso. “Criminal investigators of the IRS operate worldwide specializing in tracing the money to uncover elaborate criminal enterprises.”
Factoring involves the sale of an invoice to a third-party for a discount. In a factoring transaction, the seller of an invoice obtains immediate funding from a buyer, and the buyer of an invoice makes a profit when the invoice is paid in full. The Company purported to be in the business of buying invoices.
As set forth in court filings, Baid was the Business Head of the Company, which purported to be involved in factoring. The Company represented itself as an international factoring business run by an executive team experienced in factoring invoices in particular industries and geographic regions. Between approximately April 2017 and October 2019, Baid and others at the Company conspired to defraud an investment firm (the “Investment Firm”), which made investments on behalf of approximately 50 investors. Specifically, Baid and his co-conspirators induced the Investment Firm to invest millions of dollars in the Company through a series of material misrepresentations about the individuals who purportedly operated the Company; the nature of the Company’s business; the relationship between the Company and the entities with which it was purportedly factoring invoices; and the ways in which investor funds would be used. In July 2019, the Investment Firm stopped receiving payments on invoices that it had factored through the Company, and ultimately suffered more than $30 million in losses related to those invoices. In April 2020, the Investment Firm filed for bankruptcy.
The charges in the indictment are allegations, and the defendant is presumed innocent unless and until proven guilty.
The government’s case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys David Gopstein and Alixandra Smith are in charge of the prosecution.
The Defendant:
PUSHPESH KUMAR BAID (also known as “PK Jain”)
Age: 40
Miami, FloridaE.D.N.Y. Docket No. 21-CR-367 (MKB)
United States Postal Worker Arrested for Stealing Postal Money OrdersRead the Press Release
A criminal complaint was unsealed today in federal court in Brooklyn charging United States Postal Service (USPS) worker Jaleesa Wallace with stealing blank postal money orders and unemployment benefits cards. Wallace was arrested this morning and her initial appearance is scheduled for this afternoon before United States Magistrate Judge James R. Cho. On July 9, 2021, Willie Cook, an alleged co-conspirator, was arrested for stealing USPS money orders in connection with the scheme. Cook was released on a $25,000 bond.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Matthew Modafferi, Special Agent-in-Charge, USPS, Office of the Inspector General (USPS-OIG), and Dermot F. Shea, Commissioner, New York City Police Department (NYPD), announced the charges.
“As alleged, the defendant, a trusted public servant, pilfered thousands of postal money orders from the Postal Service and had in her possession Department of Labor unemployment benefit cards, giving her and her co-conspirator access to more than $3 million in cash,” stated Acting United States Attorney Kasulis. “This Office will vigorously prosecute government employees who exploit their positions for personal gain and abuse the public trust.” Ms. Kasulis expressed her gratitude to the investigators of the U.S. Postal Inspection Service, the USPS-OIG and NYPD for their outstanding work on the case.
“The Special Agents of the U.S. Postal Service Office of Inspector General help to maintain the integrity of the Postal Service and its personnel. When a Postal Service employee breaks the trust of the American public and participates in schemes to defraud the government, our Agents will work tirelessly to help bring those responsible to justice. We’d like to thank the U.S. Postal Inspection Service, New York Police Department, and the U.S. Attorney’s office for our strong relationships and their dedication to supporting our mission,” stated USPS-OIG Special Agent-in-Charge Modafferi.
As set forth in court filings, in February 2021, 10,000 blank postal money orders were reported missing from the Utica Avenue Post Office in Brooklyn. The postal money orders can be deposited with a financial institution for up to $1,000 each. On July 9, 2021, agents executed search warrants and recovered over 3,000 of the stolen postal money orders from Wallace’s residence and approximately 300 from Cook’s residence. At least $1.4 million worth of the stolen postal money orders had been cashed. Agents also recovered prepaid Department of Labor unemployment benefit cards and over $42,000 in cash from both apartments. Additionally, Wallace was in possession of approximately 42 pieces of mail from the Department of Labor that were not in her name. Cook posted photos of stolen postal money orders on the social media app Telegram with the caption “let’s eat,” referring to getting paid for the postal money orders. Cook is not a USPS employee.
The charges in the complaints are allegations, and the defendants are presumed innocent unless and until proven guilty. The investigation is ongoing.
The government’s case is being handled by the Office’s General Crimes Section. Assistant United States Attorney Samantha Alessi is in charge of the prosecution with assistance from Assistant United States Attorneys Garen Marshall and Dylan Stern.
The Defendants:
JALEESA WALLACE
Age: 30
Brooklyn, New YorkE.D.N.Y. Docket No. 21-MJ-808
WILLIE COOK
Age: 34
Brooklyn, New YorkE.D.N.Y. Docket No. 21-MJ-802
Queens Man Sentenced to 57 Months’ Imprisonment for Purchasing Illegally Defaced FirearmRead the Press Release
Earlier today, at the federal courthouse in Brooklyn, Joseph Miner was sentenced by United States District Judge William F. Kuntz, II, to 57 months’ imprisonment for purchasing an illegally defaced firearm in May 2020.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the sentence.
“Today’s sentence holds Miner accountable for his knowing purchase of a firearm that could not be traced because its serial number had been removed,” stated Acting U.S. Attorney Kasulis. “I commend the swift action taken by members of law enforcement to address the serious threat that possession of illegal guns poses to the safety of the community.”
Law enforcement authorities began investigating Miner’s interest in illegally purchasing firearms in late 2019, when he posted on social media his desire to obtain assault weapons and other firearms for a racial civil war or racial holy war. Miner expressed support on social media for racially and ethnically motivated violence, including celebrating the August 2017 white supremacist rally in Charlottesville, Virginia, and the December 2019 machete attack at a synagogue in Monsey, New York. Although Miner at times disavowed interest in conducting an attack himself, on multiple occasions he posted social media messages in which he displayed suicidal ideations and fantasized about “martyring” himself and “go[ing] out in a blaze of glory” in a mass-shooting attack.
In April 2020, Miner initiated contact with an undercover law enforcement agent posing as a firearms dealer. Miner requested to purchase firearms from the undercover agent, knowing that the serial numbers that allow the weapons to be traced were removed from the guns that the undercover agent was offering for sale. Following further communications to set up the gun purchase, Miner and a co-defendant met the undercover agent at a Queens hotel on the evening of May 12, 2020. Miner purchased a Glock 9mm handgun with an obliterated serial number.
The government’s case is being handled by the Office’s National Security and Cybercrime Section. Assistant United States Attorneys Artie McConnell and Josh Hafetz are in charge of the prosecution.
The Defendant:
JOSEPH MINER
Age: 31
Bayside, QueensE.D.N.Y. Docket No. 21-CR-554 (WFK)
Long Island Defendant Pleads Guilty to Multi-Million Dollar Elder Fraud SchemeRead the Press Release
Earlier today, in federal court in Central Islip, Lorraine Chalavoutis pleaded guilty before United States District Judge Joanna Seybert to conspiracy to commit mail fraud by participating in a scheme to mail fraudulent prize notices that induced recipients, many of whom were elderly and vulnerable, to believe that they could claim large cash prizes in exchange for a modest fee. None of the victims who submitted fees, which in total exceeded $30 million, received a substantial cash prize. When sentenced, Chalavoutis faces up to 20 years in prison, as well as forfeiture and a fine.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Brian M. Boynton, Acting Assistant Attorney General for the Justice Department’s Civil Division, and Philip R. Bartlett, Inspector-in-Charge, United States Postal Inspection Service, New York Division (USPIS), announced the guilty plea.
“With today’s plea, Chalavoutis has admitted her role in a nefarious and fraudulent scheme to enrich herself by tricking elderly and vulnerable victims into believing they had won a cash prize that they could collect after paying her modest fees,” stated Acting United States Attorney Kasulis. “Protecting the community from those who commit fraud to deliberately prey on the false hopes of the vulnerable remains a priority of this Office and the Department of Justice.”
“Chalavoutis set up and ran the administrative and financial operations that allowed this fraud scheme to work,” stated Acting Assistant Attorney General Boynton. “The Department of Justice is committed to protecting elderly and vulnerable Americans and to prosecuting those who defraud them.”
“Today’s plea is an example of the coordinated efforts of law enforcement to bring those to justice who prey on vulnerable adults through the distribution of bogus solicitations, luring the unsuspecting ‘prize winner’ to send money in an effort to steal not only their money, but in many cases their independence,” stated USPIS Inspector-in-Charge Bartlett.
Between December 2010 and July 2016, Chalavoutis conspired to mail fraudulent prize notices to thousands of victims throughout the United States. The mailings appeared to be personally addressed to thousands of individuals whose names were on consumer lists obtained by Chalavoutis and her primary co-conspirators, Shaun Sullivan and Tully Lovisa. Chalavoutis created various shell companies for the purported senders of the mailings and hid her co-conspirators’ involvement in the business by using straw owners. Lovisa and Sullivan previously pleaded guilty to conspiracy to commit mail fraud and are awaiting sentencing. In separate cases, several other defendants have also pleaded guilty to conspiracy to commit mail fraud in connection with the scheme.
The government’s case is being prosecuted by Assistant United States Attorney Charles P. Kelly and Trial Attorneys Daniel Zytnick and Timothy Finley of the Justice Department’s Consumer Protection Branch. Assistant United States Attorney Tanisha R. Payne of the Office’s Civil Division is in charge of forfeiture matters.
The Defendant:
LORRAINE CHALAVOUTIS
Age: 64
Greenlawn, New YorkE.D.N.Y. Docket No. 18-CR-349 (JS)
New York Man Who Allegedly Harassed NYPD Charged with Gun CrimeRead the Press Release
A New York man who allegedly hurled racial slurs at a police officer has been charged with a gun crime, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Shermaine Laster, 46, was arrested at John F. Kennedy International Airport on June 25, charged via criminal complaint with possession of a firearm by a felon. A federal grand jury in Dallas indicted him on the same charge on Thursday.
According to the complaint, travel records indicate that Mr. Laster, a convicted felon, flew from New York to Dallas to visit a local gun range, where he allegedly fired a 7.62x39 caliber rifle.
Prior to shooting the weapon, he allegedly signed a “Firearms Eligibility Experience & Range Safety Waiver,” which reminded signatories that “it is unlawful for a felon or illegal alien to possess or rent firearms or ammunition.” When the form asked if he’d ever been convicted of a felony, Mr. Laster indicated he had not.
In a video recorded at the gun range and later posted to Instagram, the defendant allegedly fired several rounds at paper targets, noting, “I’m going to be demonstrating how to take out your opponent.” A review of the Instagram feed revealed numerous photographs of handguns, with captions like “I’m ready for WAR,” “No games… fight in the dark,” and “Black Power.”
At a detention hearing in the Eastern District of New York, prosecutors introduced into evidence multiple images of Mr. Laster brandishing firearms as well as a now-viral video of Mr. Laster allegedly hurling racial slurs at an Asian-American NYPD officer in Washington Square Park.
Like all defendants, Mr. Laster is presumed innocent until proven guilty in a court of law. If convicted, he faces up to ten years in federal prison.
The Federal Bureau of Investigation’s North Texas Joint Terrorism Taskforce and the New York Police Department conducted the investigation. Assistant U.S. Attorney Melanie Smith of the Northern District of Texas is prosecuting the case with the assistance of Assistant U.S. Attorneys Francisco Navarro and Chand Edwards-Balfour of the Eastern District of New York.
Staten Island Sex Offender Pleads Guilty to Transferring Obscene Material to A MinorRead the Press Release
Earlier today, Ryan Behar pleaded guilty in federal court in Brooklyn to transferring obscene material to a minor and to committing that offense while required by state law to register as a sex offender. The proceeding took place before United States District Judge Rachel P. Kovner. When sentenced, Behar faces a statutory minimum sentence of 10 years’ imprisonment.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, announced the guilty plea.
“The defendant, a registered sex offender, admits to victimizing a 12-year-old girl by misrepresenting himself as a teenager on social media and sending her obscene, sexually explicit material,” stated Acting U.S. Attorney Kasulis. “Protecting children from predators like the defendant will always be a priority of this Office. The defendant’s conduct should serve as a reminder to parents of the dangers that may be lurking online.” Ms. Kasulis expressed her grateful appreciation to the Federal Bureau of Investigation, New York Field Office (FBI), and the FBI’s Human Trafficking and Child Exploitation Task Force for their work on the case.
As set forth in court filings and today’s court proceeding, in October 2020, while misrepresenting himself on Instagram to be a teenage boy, Behar, then 41 years old, contacted the victim and asked her age. The victim responded that she was 12 years old, provided an image of a young girl and stated, “This is what I look like.” Behar repeatedly asked the victim to send him images of her body. When she refused, Behar sent her a graphic image of adult male genitals and wrote to the victim “that’s mine,” and continued to press the victim for “full body” images.
Behar was previously convicted in February 2018 in Richmond County Supreme Court for attempted dissemination of indecent material to a minor in the first degree after sending sexually explicit material over social media to another female minor victim. Following that conviction, Behar was required to register with the New York State Division of Criminal Justice Services as a Level 1 sex offender pursuant to the New York Sex Offender Registration Act.
This prosecution is part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and the Department of Justice Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The government’s case is being handled by the Office’s General Crimes Section. Assistant United States Attorney Garen S. Marshall is in charge of the prosecution.
The Defendant:
RYAN BEHAR
Age: 42
Staten Island, New YorkE.D.N.Y. Docket No. 21-CR-187 (RPK)
Brooklyn Man Convicted of Kidnapping, Extortion and Other Crimes Related to Commercial Driver License Cheating SchemeRead the Press Release
A federal jury in Brooklyn today convicted Akmal Narzikulov of all eight counts of a superseding indictment charging him with conspiracy to unlawfully produce identification documents, conspiracy to commit kidnapping, kidnapping, conspiracy to commit Hobbs Act extortion and Hobbs Act extortion relating to a scheme to assist cheating by applicants for commercial driver licenses administered by the New York Department of Motor Vehicles (“DMV”) and licenses issued by the New York City Taxi and Limousine Commission (“TLC”). Narzikulov was also convicted of using a firearm in connection with the charged extortion and conspiracy to commit witness tampering. The verdict followed a two-week trial before United States District Judge Brian M. Cogan.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, announced the verdict.
“With the defendant’s conviction, he is held accountable for a long list of crimes, including conspiring to engage in a brazen cheating scheme, kidnapping, extortion, witness tampering and threatening a co-conspirator at gunpoint,” stated Acting U.S. Attorney Kasulis. “I commend our prosecutors for laying out the detailed road map that led to today’s verdict and for bringing justice to the individuals who were harmed by the defendant’s greed and senseless violence.” Ms. Kasulis expressed her grateful appreciation to the Federal Bureau of Investigation, New York Field Office, for their outstanding investigative work on the case.
As proven at trial, Narzikulov and other co-conspirators assisted applicants for commercial driver licenses (“CDLs”) in cheating on tests administered by the DMV in exchange for cash. Using wireless communication devices hidden inside the applicants’ clothing, Narzikulov’s co-conspirators transmitted the correct answers to earbuds used by the applicants as they took written exams at various DMV locations. For example, after making the illicit payment to the defendant and his co-conspirators, the license applicant was provided a T-shirt with a tiny hole cut out in the middle. A smartphone was attached inside the shirt with the camera aimed through the hole so the co-conspirators could view the test questions and send the answers to the applicant. The defendant and his co-conspirators used the same method to assist applicants in cheating on written tests required to obtain licenses from the TLC.
On March 28, 2019 in Brooklyn, Narzikulov, co-defendant Sherzod Mukumov and an unapprehended co-conspirator kidnapped an individual (“the Victim”) who had withdrawn from the license cheating scheme. Surveillance video showed the Victim being shocked and subdued with a taser, and then being dragged to a waiting car by Narzikulov and the co-conspirator.
On the same night as the kidnapping, Narzikulov threatened another co-conspirator at gunpoint in an attempt to extort money from him and the Victim.
As charged in the second superseding indictment, Narzikulov offered thousands of dollars to key witnesses against him to travel overseas and remain there until after the defendant’s trial was over. When Narzikulov was arrested in April 2019, FBI special agents recovered a 9mm handgun, approximately $300,000 in cash and numerous identification documents belonging to other individuals from inside a closet in the defendant’s apartment.
In November 2019, Mukumov pleaded guilty to conspiracy to commit kidnapping and is awaiting sentencing. In January 2020, Jasur Kamolov pleaded guilty to conspiracy to produce false identification documents and is awaiting sentencing. In November 2020, Murodjon Sultanov pleaded guilty to witness tampering and was sentenced in April 2021 to a term of 24 months’ imprisonment. In May 2021, Firuz Juraev pleaded guilty to Hobbs Act extortion conspiracy and conspiracy to tamper with witnesses and is awaiting sentencing.
The government’s case is being handled by the Office’s Public Integrity Section. Assistant United States Attorney Turner Buford and Special Assistant United States Attorney Virginia Nguyen are in charge of the prosecution with assistance from paralegal Shivani Parshad.
The Defendants:
AKMAL NARZIKULOV
Age: 37
Brooklyn, New YorkE.D.N.Y. Docket No. 19-CR-223 (BMC)
Used Car Dealer Sentenced to 60 Months in Prison for Odometer Tampering SchemeRead the Press Release
BROOKLYN, NY – Yesterday, in federal court in Brooklyn, Shmuel Gali was sentenced by United States District Judge Kiyo A. Matsumoto to 60 months’ imprisonment for his role in a long-running odometer tampering and money laundering scheme, and ordered to pay $3,936,000 in restitution. The defendant pleaded guilty in August 2020 to conspiracy to commit money laundering, conspiracy to commit odometer tampering, making false odometer statements and securities fraud.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Brian M. Boynton, Acting Assistant Attorney General of the Justice Department’s Civil Division, and Thomas Fattorusso, Acting Special Agent-in-Charge, Internal Revenue Service-Criminal Investigation (IRS-CI), announced the sentence.
“The sentence sends a warning that this Office will prosecute those who engage in odometer tampering and deliberately dupe consumers into unknowingly paying inflated prices for their motor vehicles,” stated Acting U.S. Attorney Kasulis. “With the defendant being sentenced to prison and ordered to pay restitution to his victims, he is being held to account for his greed in contriving this fraudulent scheme.”
“An automobile is one of the biggest purchases many consumers make,” stated Acting Assistant Attorney General Boynton. “Misrepresenting used car mileages defrauds buyers and hides important information concerning safety and reliability. The Department of Justice will continue to work with law enforcement partners to prosecute odometer fraud.”
“Automobile sales stand as one of the pillars of the American economy requiring transparency and integrity,” stated Acting IRS-CI Special Agent-in-Charge Fattorusso. “The financial expertise of IRS-CI was needed to uncover this criminal enterprise perpetuated by Shmuel Gali who received a just sentence relative to his criminal activity.”
Between 2006 and June 2011, Shmuel Gali, while conspiring with his brother Chaim, defrauded buyers of used motor vehicles by misrepresenting the mileage of approximately 690 vehicles that they sold. They used fictitious dealer names to purchase high mileage, used motor vehicles from a national vehicle leasing company, altered the odometers of the vehicles to reflect false, lower mileages, and then sold the vehicles at wholesale automobile auctions. On average, the odometers on the vehicles were rolled back by close to 70,000 miles. Consumers who purchased the vehicles at dealerships did not know the true mileage and paid inflated sales prices.
This matter was investigated by the U.S. Department of Transportation National Highway Traffic Safety Administration (NHTSA) Office of Odometer Fraud Investigation, and the Internal Revenue Service-Criminal Investigation.
Assistant United States Attorney Catherine M. Mirabile of the Eastern District of New York and Senior Litigation Counsel Linda I. Marks of the Civil Division’s Consumer Protection Branch prosecuted the case.
The Defendant:
SHMUEL GALI (also known as “Sam Gali”)
Age: 48
Brooklyn, New York; IsraelE.D.N.Y. Docket No. 14-CR-652 (KAM)
Amec Foster Wheeler Energy Limited Resolves Foreign Bribery Case and Agrees to Pay Penalty of over $18 MillionRead the Press Release
Amec Foster Wheeler Energy Limited (“Amec Foster Wheeler,” or the “Company”), a subsidiary of John Wood Group plc (“Wood”), a United Kingdom-based global engineering company, has agreed to pay a penalty of more than $18 million to resolve charges stemming from the Company’s involvement in a scheme to pay bribes to foreign officials in Brazil in exchange for an approximately $190 million contract to design a gas-to-chemicals complex.
Earlier today, in federal court in Brooklyn, Amec Foster Wheeler entered into a three-year deferred prosecution agreement (“DPA”) with the U.S. Attorney’s Office for the Eastern District of New York and the Department of Justice’s Criminal Division, Fraud Section in connection with the filing of a criminal information filed in the Eastern District of New York charging the Company with conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act (“FCPA”). In related proceedings, the Company has received provisional court approval for a settlement with the United Kingdom’s Serious Fraud Office and has settled with the Ministério Público Federal (“MPF”), the Advogado-Geral da União (“AGU”), and the Controladoria-Geral da União (“CGU”) in Brazil. A subsidiary of Wood has also agreed to resolve a related civil matter with the U.S. Securities and Exchange Commission (“SEC”).
Jacquelyn M. Kasulis, Acting U.S. Attorney for the Eastern District of New York, Nicholas L. McQuaid, Acting Assistant Attorney General of the Justice Department’s Criminal Division, and Steven M. D’Antuono, Assistant Director-in-Charge, Federal Bureau of Investigation, Washington Field Office (FBI), made the announcement.
“Amec Foster Wheeler conspired to pay bribes to officials in Brazil as part of a corrupt scheme to obtain a $190 million government contract and generate millions of dollars in profits,” stated Acting U.S. Attorney Kasulis. “The defendant’s lengthy DPA and agreement to pay a penalty of more than $18 million demonstrate the commitment of this Office to enforcing the anti-bribery provisions of the FCPA and holding companies like Amec Wheeler Foster accountable for its illegal conduct and corporate greed.”
“Amec Foster Wheeler has now admitted to paying bribes in Brazil to win a lucrative contract,” said Acting Assistant Attorney General McQuaid of the Justice Department’s Criminal Division. “In the pursuit of profits, the company resorted to corruption, which distorts markets and undermines the rule of law. Today’s resolution, including the financial penalty and agreement to enhance compliance, underscores the Department of Justice’s commitment to holding companies accountable when they break the law and to rooting out criminal misconduct.”
“Today’s announcement demonstrates the FBI’s dedication to work with our international partners in the global effort to hold individuals and companies accountable who believe corruption is the only way to do business,” stated FBI Assistant Director-in-Charge D’Antuono. “When companies like Amec Foster Wheeler attempt to cheat the system, it creates an uneven playing field for businesses who don’t pay bribes. This deferred prosecution agreement, which includes both a substantial criminal penalty and other provisions, should serve as a warning to companies that even using a third-party intermediary to pay bribes will not preclude them from being held responsible for international corruption.”
According to the Company’s admissions and court documents, between 2011 and 2014, Amec Foster Wheeler conspired with others, including an Italian sales agent affiliated with a Monaco-based intermediary company, to pay bribes to decision-makers at Petróleo Brasileiro S.A. (“Petrobras”) in order to win a lucrative contract, worth approximately $190 million, from Petrobras to design a gas-to-chemicals complex in Brazil called Complexo Gás-Químico UFN-IV. The Company, through certain of its employees and agents, took acts in furtherance of the scheme while located in New York and Texas, and earned at least $12.9 million in profits from the corruptly obtained business.
As part of the DPA, for a three-year period, Amec Foster Wheeler agreed to continue to cooperate with the U.S. government in any ongoing or future criminal investigations concerning Amec Foster Wheeler, its executives, employees or agents. In addition, Amec Foster Wheeler and its parent company, Wood, agreed to enhance their compliance programs and to report to the government on the implementation of those programs.
The government reached this resolution with Amec Foster Wheeler based on a number of factors, including the Company’s failure to voluntarily and timely disclose the conduct that triggered the investigation, the nature and seriousness of the offense, which spanned multiple years and involved a high level executive, and credit for the Company’s cooperation. The Company also engaged in remedial measures, including terminating the individuals involved in the misconduct and adopting heightened controls and anti-corruption procedures. Accordingly, the criminal penalty reflects a 25 percent reduction off the applicable U.S. Sentencing Guidelines fine for the Company’s full cooperation and remediation.
In related proceedings, the Company also has received provisional court approval for a settlement with the United Kingdom’s Serious Fraud Office and has settled with the MPF, the AGU and the CGU in Brazil. Under the DPA, the Department will credit up to 25 percent ($4,593,750) of the criminal penalty owed to the United States to payments the Company makes pursuant to the resolution with the United Kingdom’s Serious Fraud Office, and up to 33 percent ($6,125,000) of the criminal penalty owed to the United States to payments the Company makes pursuant to the resolution with Brazilian authorities.
In a related civil matter with the SEC, a subsidiary of Wood has agreed to pay the SEC disgorgement and prejudgment interest totaling approximately $22.7 million for the conduct in Brazil.
The FBI’s Washington Field Office is investigating the case. Assistant U.S. Attorney Julia Nestor of the Eastern District of New York, Assistant Chief Gerald M. Moody, Jr. and Trial Attorney Dennis Kihm of the Criminal Division’s Fraud Section are prosecuting the case. The U.K.’s Serious Fraud Office and Brazil’s MPF, AGU, and CGU provided significant assistance.
The Defendant:
Amec Foster Wheeler Energy Limited
E.D.N.Y. Docket No. 21-CR-298 (KAM)
East Coast Leader of Eight Trey Crips Street Gang Sentenced to Life in Prison for Execution-Style Murder in Brooklyn NightclubRead the Press Release
Larry Pagett, the East Coast leader of the Eight Trey Crips street gang, was sentenced today by United States District Judge William F. Kuntz, II to life imprisonment for murdering a member of the rival Folk Nation street gang as part of a gang turf war. Pagett was convicted by a jury of murder in-aid-of racketeering in October 2018 following an eight-day trial.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., 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.
“Larry Pagett will deservedly spend the rest of his life behind bars for brazenly committing an execution-style, gang-related murder inside a lounge in Brooklyn,” stated Acting U.S Attorney Kasulis. “This Office will continue working tirelessly with our law enforcement partners to eradicate the murderous violence of street gangs like the Eight Trey Crips and end their wanton disregard for human life.”
The Eight Trey Crips were based in and around the Flatbush Gardens housing complex. The Crips and the Folk Nation, a rival street gang, had been engaged in a deadly feud over territory in Brooklyn for years. On August 28, 2015, Pagett encountered Chrispine Philip, also known as “Droppa,” inside the Buda Hookah Lounge located on Flatbush Avenue in Brooklyn. Philip was a member of the rival Folk Nation, and Pagett blamed him for the murder of an Eight Trey Crips gang member in Trinidad in the Spring of 2015. Pagett pulled out a gun, shot Philip multiple times and ended his life with a final bullet to the back of his head. A bystander in the crowded nightclub was also shot in the stomach and arm, but survived. The murder was recorded on video surveillance cameras inside the club.
The government’s case is being handled by the Office’s Organized Crime and Gangs Section. Assistant United States Attorneys Patrick T. Hein and Mathew S. Miller are in charge of the prosecution.
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 Defendant:
LARRY PAGETT (also known as “Biz,” “Biz Loc” and “Molotovbizzz”)
Age: 41
Brooklyn, New YorkE.D.N.Y. Docket No. 17-CR-306 (WFK)
Brooklyn Man Convicted of Sexually Abusing Female Passenger Aboard International Flight from Abu Dhabi to Kennedy AirportRead the Press Release
A federal jury in Brooklyn today returned a guilty verdict against Daniel Martin Katz on both counts of an indictment charging him with abusive sexual contact and assault in the special aircraft jurisdiction of the United States. The verdict followed a three-day trial before United States District Judge Frederic Block.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the verdict.
“With today’s verdict, the jury has held the defendant accountable for his unwanted, in-flight assault of a young, vulnerable woman who was sleeping in a darkened aircraft cabin during a transatlantic flight,” stated Acting U.S. Attorney Kasulis. “This Office will vigorously prosecute reprehensible acts of sexual abuse that take place onboard aircrafts.”
“Today, Mr. Katz learned there are consequences for his outrageous assault of a fellow passenger. To others who need a quick refresher, here it is: The FBI's jurisdiction includes any illegal act committed on a plane the moment the doors are closed. Behave yourselves. If you break the law while aboard an aircraft, you will be arrested and held accountable,” stated FBI Assistant Director-in-Charge Sweeney.
The government’s evidence at trial established that on February 24, 2018, Katz and the then-25-year-old victim were passengers aboard Etihad Airways Flight 103, an overnight flight traveling from Abu Dhabi, United Arab Emirates, to John F. Kennedy International Airport in Queens, New York. The victim, assigned to a window seat, fell asleep with Katz assigned to the aisle seat next to her. While she slept, Katz reached into the victim’s pants with his hand and touched her genitals. She awoke to the defendant sexually abusing her.
The government’s case is being prosecuted by Assistant United States Attorneys Kayla C. Bensing and James P. McDonald.
The Defendant:
DANIEL MARTIN KATZ
Age: 36
Brooklyn, New YorkE.D.N.Y. Docket No. 19-CR-115 (FB)
Acting United States Attorney Jacquelyn M. Kasulis Announces Formation of Environmental Justice Team in the Office’s Civil DivisionRead the Press Release
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, announced today the creation of the Environmental Justice Team. The Environmental Justice Team, comprised of seven Civil Division Assistant U.S. Attorneys, including the Civil Division Chief of Environmental Litigation, reinforces the Office’s focus on protecting the rights of residents of the Eastern District of New York who are disproportionately burdened by environmental and health hazards. The Office has responsibility for the enforcement of our nation’s laws in the Eastern District of New York, which encompasses three of the five boroughs of New York City – Brooklyn, Queens and Staten Island – and Nassau and Suffolk Counties on Long Island. The Eastern District of New York encompasses approximately eight million people.
The Office is creating this team in recognition of President Joseph Biden’s directive in Executive Order 14008, which mandates that “[a]gencies shall make achieving environmental justice part of their missions by developing programs, policies, and activities to address the disproportionately high and adverse human health, environmental, climate-related and other cumulative impacts on disadvantaged communities, as well as the accompanying economic challenges of such impacts.” Among the areas that the Environmental Justice Team will focus on are child lead exposure, clean air, and the protection of groundwater, surface waters, and wetlands across New York City and Long Island.
In announcing the formation of the Environmental Justice Team, Acting United States Attorney Kasulis stated, “I am proud to announce the formation of our Environmental Justice Team, which will enhance the Office’s longstanding commitment to environmental enforcement by addressing disproportionate environmental, health, economic and climate impacts on disadvantaged communities. The Environmental Justice Team is a critical part of the Office’s longstanding commitment to fighting pollution and climate change. This Office will continue to vigorously enforce federal environmental laws and hold polluters accountable.”
“For too long, the lived experience of many communities whose residents are predominantly of color, Indigenous, or low-income is that they suffer from disproportionately high pollution levels that result in adverse health and environmental impacts,” stated EPA Acting Regional Administrator Walter Mugdan. “The creation of this Environmental Justice Team is a positive step forward to strengthen the enforcement of our bedrock environmental laws and Title VI of the Civil Rights Act to ensure violations in environmental justice communities are promptly identified and corrected, and that appropriate penalties are imposed as a deterrent against future violations. Environmental justice is a central driving factor in all that we all do.”
The Office will continue to partner and coordinate with the Environment and Natural Resources Division at the U.S. Department of Justice, as well as client agencies across the federal government.
The Environmental Justice Team is led by Civil Division Chief of Environmental Litigation Matthew Silverman; the Environmental Justice Team is made up of Senior Litigation Counsel Deborah Zwany and Assistant U.S. Attorneys Ekta R. Dharia, Kathleen Mahoney, Thomas Price, Shana C. Priore and Alex Weinberg. The Environmental Justice Team is overseen by Civil Division Acting Chief Joseph A. Marutollo and Civil Division Deputy Chief Richard K. Hayes.
The Office previously announced the creation of a Civil Rights Team in the Office’s Civil Division, which is comprised of the Civil Division Chief of Civil Rights, four Civil Division Assistant U.S. Attorneys, and a Civil Rights investigator. The Civil Rights Team’s focus will be on protecting the rights of the most vulnerable residents of the Eastern District of New York, especially those in disadvantaged communities. The Environmental Justice Team will be coordinating its work with the Civil Rights Team.
Jacquelyn M. Kasulis Appointed Acting United States Attorney for the Eastern District of New YorkRead the Press Release
Jacquelyn M. Kasulis has begun serving as Acting United States Attorney for the Eastern District of New York, as per the Vacancies Reform Act. Ms. Kasulis was sworn in today by Chief Judge Margo K. Brodie, United States District Court Judge for the Eastern District of New York. Ms. Kasulis was also appointed First Assistant U.S. Attorney as per the Vacancies Reform Act and will continue to hold that position as well. Ms. Kasulis has served as the Chief Assistant United States Attorney since March 2021. In that role she has been second-in-command of the U.S. Attorney’s Office and responsible for overseeing the Criminal, Civil, Administrative and Appeals Divisions and the day-to-day operations of the Office, including the Office’s COVID-19 response. Ms. Kasulis succeeds Mark J. Lesko who will soon be appointed Acting Assistant Attorney General for the Department of Justice’s National Security Division.
“I am honored to serve as the Acting U.S. Attorney for the Eastern District of New York. After serving as an Assistant U.S. Attorney for over a decade, and overseeing the work of the Criminal and Civil Divisions, I look forward to leading and supporting the men and women of the Office as they work tirelessly with our law enforcement and agency partners to ensure the safety of our community and pursue the cause of justice,” stated Acting U.S. Attorney Kasulis. “I am especially grateful to the members of the Office for their unwavering commitment to the people of this District and the country during the pandemic, and look forward to assisting the Office as it emerges from the unprecedented challenges of the last year.”
Ms. Kasulis joined the U.S. Attorney’s Office in January 2008 and has served in the General Crimes, Organized Crime, and Business & Securities Fraud Sections. From September 2014 to November 2015, Ms. Kasulis served as Deputy Chief in General Crimes for the Office. She later served as Deputy Chief in the Business & Securities Fraud Section from November 2015 to March 2017 and was appointed Chief of the Business & Securities Fraud Section in March 2017.
Ms. Kasulis began serving as Acting Chief of the Criminal Division in March 2019 and was appointed Chief of the Criminal Division in June 2019. She established and supervised the Office’s Bank Integrity Task Force. She was also selected to be a member of the Department of Justice’s Criminal Chiefs Working Group.
Ms. Kasulis led the Office’s investigation and prosecution of three individuals, including two former Goldman Sachs bankers and a wealthy Malaysian financier, for their participation in a multi-billion dollar money laundering and bribery conspiracy related to 1 Malaysia Development Berhad (lMDB), Malaysia’s investment development fund. In October 2020, Goldman Sachs entered into a three-year deferred prosecution agreement and one of Goldman Sachs’ Malaysian subsidiaries pleaded guilty to a one-count criminal information charging conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act. As part of that resolution, Goldman Sachs admitted to paying over $1.6 billion in bribes to high-ranking Malaysian and Abu Dhabi officials to obtain lucrative business deals, including underwriting three bond deals between 2012 and 2014 that totaled $6.5 billion, of which $2.7 billion was embezzled. Goldman Sachs agreed to pay $2.9 billion in penalties -- with $1.2 billion paid to the United States Treasury -- as part of a global resolution with eight different foreign and domestic authorities. The Goldman Sachs resolution represents the largest penalty ever paid to U.S. authorities in a foreign bribery case; the most civil and criminal authorities to ever coordinate on any corporate resolution; and the most bribes paid in a foreign bribery scheme prosecuted by the United States.
Ms. Kasulis was the lead Assistant U.S. Attorney in United States v. Martin Shkreli, a high-profile six-week trial in the summer of 2017. Shkreli was charged in four interrelated fraud schemes that resulted in over $20 million in losses to investors, including two fraud schemes related to hedge funds he founded and ran and two additional frauds related to a pharmaceutical company Shkreli founded. Shkreli was convicted of three of the four fraud schemes and sentenced to seven years’ imprisonment.
Additionally, Ms. Kasulis led the investigation and prosecution in United States v. Bandfield, et al., in which 10 defendants and six corporations were charged with orchestrating a massive offshore securities fraud, money laundering and tax evasion schemes. As part of that scheme, the defendants laundered approximately $250 million in securities fraud proceeds and were involved in approximately 40 “pump and dump” schemes. The case represents the first criminal prosecution under the Foreign Account Tax Compliance Act (FATCA).
In United States v. Mitchell, et al., Ms. Kasulis participated in the investigation and prosecution of the Executive Chairman of Forcefield Energy, a NASDAQ-listed company, and nine other individuals -- including five registered broker dealers -- for their role in a $131 million market manipulation scheme involving a network of corrupt investors, stock promoters and broker dealers. In United States v. Peister, Ms. Kasulis led the prosecution and conviction of an investment fund manager who defrauded approximately 75 investors by orchestrating a $17 million Ponzi scheme on Long Island.
During her time in the Organized Crime Section, Ms. Kasulis led the prosecution of over 15 Genovese crime family members and associates in United States v. Depiro, et al., including the conviction of three consecutive International Longshoremen’s Association union presidents for their involvement in a 30-year extortion scheme in which longshoremen were extorted at Christmastime every year at the direction of the Genovese crime family. Ms. Kasulis also led the trial team in United States v. Burke, in which the defendant, a Gambino crime family associate, was convicted of racketeering conspiracy, with predicate acts including two murders, and was sentenced to life imprisonment.
Ms. Kasulis graduated from Columbia Law School in 2003 and received her B.A. in History from Davidson College. After graduation, Jackie worked as a litigation associate for four years at Kirkland & Ellis LLP in New York.
Acting United States Attorney Mark J. Lesko Announces Formation of Civil Rights Team in the Office’s Civil DivisionRead the Press Release
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, announced today the creation of a Civil Rights Team in the Office’s Civil Division. The Team, comprised of four Civil Division Assistant U.S. Attorneys and the Civil Division Chief of Civil Rights, enhances the Office’s focus on protecting the rights of the most vulnerable residents of the Eastern District of New York, especially those in disadvantaged communities. The Office has responsibility for the enforcement of our nation’s Civil Rights laws in the Eastern District of New York, which encompasses Brooklyn, Queens and Staten Island and Nassau and Suffolk Counties on Long Island. There are approximately eight million residents in the Eastern District.
The Office is creating this team in recognition of President Joseph Biden’s directive in Executive Order 13985, which sets forth that “[a]ffirmatively advancing equity, civil rights, racial justice, and equal opportunity is the responsibility of the whole of our Government.” Among the areas that the Team will focus on are policing, patterns and practices of housing discrimination, and school segregation.
In announcing the formation of the Civil Rights Team, Acting United States Attorney Lesko stated, “Today, the Eastern District of New York, a jurisdiction created by President Abraham Lincoln in 1865, celebrates the Juneteenth National Independence Day commemorating the abolition of slavery, which was signed into law yesterday by President Biden. This Office is firmly committed to identifying and rooting out discrimination in all of its forms, wherever it persists, and we have a long and storied history in the Eastern District of New York of enforcing federal laws that prohibit discrimination. The creation of the Civil Rights Team will further strengthen the Office’s capacity to investigate and civilly prosecute civil rights violations in the City of New York and on Long Island, especially our ability to handle investigations of systemic discrimination. The establishment of the Team demonstrates the commitment of this Office to vigorously enforce our federal civil rights laws to help foster a community where individuals can live safely, free from unlawful discrimination, and ensure equal rights for all, regardless of race, color, national origin, religion, sex, sexual orientation, gender identity or disability.”
The Office’s Civil Rights Practice is led by Civil Division Chief of Civil Rights Michael J. Goldberger; the Civil Rights Team is made up of Assistant United States Attorneys Rachel G. Balaban, Megan Freismuth, Sean Greene-Delgado, Dara Olds, and Civil Rights Investigator Laura Riley. The Civil Rights Team is overseen by Civil Division Acting Chief Joseph A. Marutollo and Civil Division Deputy Chief Richard K. Hayes. The Team will continue to partner and coordinate with the Department of Justice Civil Rights Division and federal, state and local agencies that enforce civil rights laws. The Office previously announced it had doubled the size of the Criminal Civil Rights Section under the leadership of Chief Elizabeth Geddes, who, among her other responsibilities, will act as liaison to the Civil Division’s newly formed Civil Rights Team.
The Office has also created a new webpage, located at https://www.justice.gov/usao-edny/civil-rights, dedicated to Civil Rights Enforcement, which highlights the work of the Office and provides links to complaint forms and to other civil rights resources. For more information on the U.S. Attorney’s Office, or to report to report suspected violations of civil rights please visit https://www.justice.gov/usao-edny.
Five Employees of Utility Company Charged in Bribery and Kickback SchemeRead the Press Release
Defendant Complained to Contractor in Code That Bribe Payment was Insufficient: “Sandwich was Light on the Meat”
A criminal complaint was unsealed today in Brooklyn charging Devraj Balbir, Ricardo Garcia, Patrick McCrann, Jevan Seepaul and Richard Zavada, managers employed in the facilitiesdepartment of a New York utility company (the “Company”), with conspiring to violate the Travel Act by accepting hundreds of thousands of dollars in bribes and kickbacks in exchange for steering contracts to certain Long Island-based contractors with whom the Company did business. One contractor (the “Contractor”) secured more than $50 million in facility maintenance contracts from the Company during the time that the Contractor was paying bribes to the defendants. The defendants were arrested today and will make their initial appearances this afternoon before United States Magistrate Judge James R. Cho.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the arrests and charges.
“As alleged, the defendants made corrupt demands for bribes and kickbacks to line their own pockets and upgrade their lifestyles, while putting the contractors at risk of losing business if they did not comply,” stated Acting U.S. Attorney Lesko. “This Office is committed to protecting the integrity of the bidding process and ensuring that businesses compete on a level, honest playing field.”
"Crimes of this nature weaken the integrity of the bidding process and deny consumers the benefit of free and open competition in the marketplace. The FBI will continue to work with the Antitrust Division to ensure fair bidding practices are employed across all sectors of our economy," stated FBI Assistant Director-in-Charge Sweeney.
As alleged in the complaint, between 2013 and 2020, the defendants solicited and accepted bribes and kickbacks from the owners of the Contractor and other contractors in connection with the awarding of maintenance work contracts for the Company. As managers in the facilities department of the Company, McCrann, Garcia (after May 1, 2019) and Balbir (after May 1, 2020) had the authority to approve “no-bid” contracts valued at less than $50,000. The Contractor understood that if it did not pay bribes, these defendants would award the Company’s work to the Contractor’s competitors. In exchange for the bribe payments, the defendants, including Seepaul and Zavada, also took various steps to assist the Contractor in obtaining contracts from the Company for which there was a bidding process, including providing it with non-public bidding information, circumventing the Company’s competitive bidding process and offering favorable reviews of the Contractor’s work. The Contractor paid bribes to ensure that the defendants did not slow or stop disbursement of project funds to the Contractor, provide negative performance reviews regarding the Contractor’s work, or otherwise claim that the Contractor’s work did not meet contractual specifications. The defendants communicated with the contractors about bribe payments by text messages, among other forms of communication. For example, on September 2, 2016, McCrann texted a contractor, “Sandwich was light on the meat” and that McCrann was “a little concerned,” indicating that a bribe payment had been insufficient. The contractor replied, “I’ll ask for a nice one next time,” indicating that the next bribe payment would be larger.
The illicit payments to the defendants took multiple forms, including cash, purchase of a recreational vehicle, home improvements, landscaping and an overseas vacation. For example, during 2017 and 2018, the Contractor paid tens of thousands of dollars in bribes to Balbir in the form of renovations performed at his residence. Between August 2015 and April 2019, the Contractor also made college tuition payments totaling more than $30,000 for a family member of Garcia. On February 25, 2018, Garcia sent a text message to a contractor containing images of airlines reservations for two individuals in April 2018 from Newark to Dubai and hotel reservation information for a 10-night hotel stay in Dubai for two individuals so that the contractor could pay for the expenses. Financial records obtained during the investigation also revealed that the Contractor paid approximately $100,000 for work performed at Seepaul’s home during 2017.
As part of the investigation, agents recovered approximately $300,000 in cash from a safe deposit box held by Zavada. On November 18, 2020, FBI special agents executed a search warrant at Zavada’s residence in Hicksville, New York, and seized electronic spreadsheets he maintained that contained dates, the amounts of bribe payments, and the names of various entities that provided facilities services to the Company.
The charges in the complaint are merely allegations, and the defendants are presumed innocent unless and until proven guilty.
The government’s case is being handled by the Office’s Public Integrity Section. Assistant United States Attorneys Turner Buford, Artie McConnell and Nathan Reilly are in charge of the prosecution.
The Defendants:
DEVRAJ BALBIR
Age: 33
North Bellmore, New YorkRICARDO GARCIA
Age: 48
Stroudsburg, PennsylvaniaPATRICK MCCRANN
Age: 57
Selden, New YorkJEEVAN SEEPAUL
Age: 36
Rockville Centre, New YorkRICHARD ZAVADA
Age: 65
Hicksville, New YorkE.D.N.Y. Docket No. 21-MJ-696
Queens Woman Sentenced to More Than 16 Years’ Imprisonment for Teaching and Distributing Information About Weapons of Mass DestructionRead the Press Release
Today in federal court in Brooklyn, Noelle Velentzas was sentenced to 16 ½ years’ imprisonment by United States District Judge Sterling Johnson, Jr. for her role in planning a terrorist attack in the United States. Velentzas and her co-defendant, Asia Siddiqui, pleaded guilty on August 23, 2019 to teaching or distributing information pertaining to the making and use of an explosive, destructive device, or weapon of mass destruction in furtherance of a planned federal crime of violence. Siddiqui was sentenced in January 2020 to 15 years’ imprisonment.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York; John C. Demers, Assistant Attorney General for the Justice Department’s National Security Division; William F. Sweeney, Jr., 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.
“The defendant expressed her support for foreign terrorist organizations like al-Qaeda and the Islamic State of Iraq and al-Sham by learning how to build bombs and other explosive devices and targeting members of law enforcement for terror. Today’s sentence imposes a just punishment on the defendant for her planned horrific crimes,” stated Acting U.S. Attorney Lesko. “Counterterrorism and protecting the American people remain among the highest priorities of the Department of Justice, and this Office, together with the FBI, the NYPD and our Joint Terrorism Task Force partners, will continue to exercise extreme vigilance to incapacitate terrorists.”
“As part of her plan goal to wage violent jihad, Velentzas and her co-defendant Asia Siddiqui researched and taught each other how to construct bombs to be used on American soil against law enforcement and military targets,” stated Assistant Attorney General Demers. “With the sentence imposed by the court, Velentzas has been held accountable for her crimes. The Attorney General recently reminded us that we must remain vigilant against threats from international terrorism, and we are grateful for those agents, analysts and prosecutors who were and brought Velentzas to justice before she could carry out her plans.”
Between approximately 2013 and 2015, Velentzas and her co-defendant Asia Siddiqui taught each other chemistry and electrical skills directly related to creating explosives and building detonating devices; studied the explosives used in past terrorist attacks including the Boston Marathon bombing, the Oklahoma City bombing, and the 1993 World Trade Center attack; researched how to make plastic explosives and build car bombs; shopped for and acquired materials to be used in an explosive device; and assessed potential targets of an attack, focusing on law enforcement and military-related targets.
While engaging in these activities, Velentzas repeatedly expressed her support for promoting and waging violent jihad and her desire to commit acts of violence. Velentzas claimed that Osama bin Laden was her hero, and expressed praise for the September 11, 2001 attacks as well as Mohammed Shnewer, who was convicted of plotting a terrorist attack against members of the armed services at Fort Dix in New Jersey.
At the time that Velentzas and Siddiqui were arrested in 2015, law enforcement officers searched their residences and found tools of the trade for a terrorist attack, including propane gas tanks, soldering tools, car bomb instructions and jihadist literature, machetes and knives.
The government’s case is being handled by the Office’s National Security & Cybercrime Section. Assistant United States Attorneys Craig R. Heeren, Jennifer M. Sasso, Josh Hafetz and Jonathan E. Algor are in charge of the prosecution, with assistance provided by Trial Attorney Jennifer Burke of the National Security Division’s Counterterrorism Section.
The Defendant:
NOELLE VELENTZAS
Age: 33
Queens, New YorkE.D.N.Y. Docket No. 15-CR-213 (SJ)
Brooklyn Man Sentenced to More Than 31 Years’ Imprisonment for Attempted Murder and Assault of an FBI Special AgentRead the Press Release
Earlier today, at the federal courthouse in Brooklyn, Ronell Watson was sentenced to 382 months years’ imprisonment by United States District Judge William F. Kuntz, II, for the attempted murder and assault of Christopher Harper, a Special Agent of the Federal Bureau of Investigation. Watson was convicted by a federal jury in July 2019 following a two-week trial.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the sentence.
“Today, justice has been served. This Office is gratified by the lengthy prison sentence the court imposed on Watson for his senseless, cold-blooded and unprovoked shooting of Special Agent Harper, who came close to losing his life,” stated Acting U.S. Attorney Lesko. “This Office will never tolerate murderous assaults on members of law enforcement who put their lives on the line every day to protect and serve our communities.” Mr. Lesko extended his grateful appreciation to the New York City Police Department for its assistance during the investigation and the medical staff at Kings County Hospital for saving Special Agent Harper’s life.
“Ronell Watson has now learned illegal behavior comes with lasting consequences. He will now spend the next 31 years of his life in federal prison for his ambush attack of FBI Special Agent Harper. While Watson is no longer a threat to the community, FBI Special Agents and our law enforcement partners remain on watch for those like him who have no regard for the lives of their fellow citizens. I would like to acknowledge Special Agent Harper's bravery and quick thinking, which not only saved his life, but led to Watson's swift arrest. His professionalism and courage under fire were an example for all of us. This office is also eternally grateful to the NYPD, civilians, and the medical teams who responded to save their fellow public servant,” stated FBI Assistant Director-in-Charge Sweeney.
On December 8, 2018, Special Agent Harper was on-duty conducting surveillance in an unrelated case. At approximately 3:20 p.m., Watson, driving a BMW sedan in the wrong direction, approached Agent Harper’s vehicle. Watson partially blocked Agent Harper’s vehicle, exited his BMW and approached Agent Harper’s vehicle with his hand inside the pocket of his sweatshirt. As Agent Harper tried to maneuver his vehicle around the BMW, Watson pulled a handgun out of his pocket and fired multiple shots, wounding Agent Harper in the back; the bullet lodged in one of his lungs. Agent Harper returned fire at Watson, wounding him in the hand. Watson abandoned his bullet-ridden BMW at a nearby auto body shop, then had a friend drive him in another vehicle to the hospital where he was ultimately arrested. Special Agent Harper underwent multiple surgeries to have the bullet removed from his lung and continue his service as a Special Agent of the FBI.
Assistant United States Attorney Francisco J. Navarro is in charge of the prosecution.
The Defendant:
RONELL WATSON
Age: 33
Canarsie, BrooklynE.D.N.Y. Docket No. 19-CR-4 (WFK)
Bloods Gang Leader Convicted of Attempted Murder-in-Aid of Racketeering and Other Violent CrimesRead the Press Release
Following six weeks of trial, a federal jury in Central Islip today convicted Howard Davis, also known as “Mousey” and “Mr. Fedup,” a Bloods gang leader from Bellport, New York, on all 48 counts, including attempted murder in-aid-of racketeering, conspiracy to commit murder, attempted murder, assault, robbery, distribution of controlled substances, obstruction of justice and brandishing and discharging firearms during the commission of these offenses. Davis faces up to life imprisonment when he is sentenced by United States District Judge Joan M. Azrack.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York; Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI); William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); and Stuart J. Cameron, Acting Commissioner, Suffolk County Police Department (SCPD), announced the verdict.
“With today’s conviction, a jury of his peers has held Davis to account for his long and brutal reign of terror, consisting of standing orders to kill, the shooting of six victims, and the spread of poisonous crack cocaine and heroin in our communities,” stated Acting U.S. Attorney Lesko. “This Office and its law enforcement partners will continue their tireless efforts to eliminate the threats posed by violent defendants like Davis and dangerous street gangs like the Bloods.” stated Acting United States Attorney Lesko. Mr. Lesko extended his grateful appreciation to the law enforcement agencies involved in the investigation and prosecution of Davis, including the FBI Long Island Gang Task Force and HSI Long Island Violent Gangs and Narcotics Unit.
“This infamous Bloods gang leader known as “Mousey” is convicted in federal court because of the unrelenting commitment of HSI’s Long Island Transnational Crime Task Force and our law enforcement partners to make our communities safer here on Long Island,” stated HSI Special Agent-in-Charge Fitzhugh. “Davis was arrested and charged with a litany of violent felony crimes for his barbarous actions, and now his conviction has made the Suffolk County neighborhoods he terrorized safer with one less gang leader calling the shots. Davis clearly lost this game of cat and mouse.”
“Mr. Davis and his fellow gang members are the type of criminals who wreck neighborhoods by dealing potentially lethal drugs. They terrorize communities by firing illegal guns without thinking about the innocent people they may hit. These are the criminals who belong behind bars, and our job as law enforcement is to stop their criminal behavior before their actions harm anyone else,” stated FBI Assistant Director-in-Charge Sweeney.
“The conviction of Howard Davis highlights the outstanding results that can be achieved when local law enforcement works in tandem with our federal law enforcement partners,” stated SCPD Acting Commissioner Cameron. “His criminal activities endangered the residents of our county on a daily basis and his criminal activities know no bounds as he went as far as enticing the mother of his child to commit perjury for him. I would like to thank all of the law enforcement officers involved for their hard work to put this dangerous individual behind bars.”
As proven at trial, Davis was the leader of Long Island-based G-Shine Bloods set, a racketeering enterprise that engaged in multiple crimes of violence and narcotics trafficking. Davis directed a campaign of violence against his rivals, including issuing a standing order to kill certain individuals whenever and wherever they were found. In addition, Davis committed numerous shootings. During the trial, the government elicited details of the injuries suffered by more than six shooting victims at the hands of Davis and his G-Shine crew. Davis and his gang financed its activities through extensive narcotics trafficking. Over the course of the defendant’s narcotics trafficking conspiracy, he distributed large quantities of crack cocaine and heroin, as well as quantities of fentanyl. The evidence also established that Davis possessed and used firearms to further his drug business and gang activities. Davis was also convicted of obstruction of justice for arranging for the mother of his child to testify falsely before a federal grand jury, resulting in the 2016 dismissal of a firearms charge.
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 Christopher Caffarone, Mark Misorek and Monica Castro are in charge of the prosecution.
The Defendant:
HOWARD DAVIS (also known as “Mousey” and “Mr. Fedup”)
Age: 34
Bellport, New YorkE.D.N.Y. Docket No. 17-CR-615 (JMA)
Long Island Gang Member Indicted for Sex Trafficking and Sexual Exploitation of MinorsRead the Press Release
Earlier today, in federal court in Central Islip, a seven-count indictment was unsealed charging Joshua Lampley-Reid, a member of the Makk Balla set of the Bloods street gang, with sex trafficking, coercion and enticement of a minor, sexual exploitation of a minor, transportation of child pornography and interstate prostitution. Lampley-Reid was arrested on Wednesday and will be arraigned this afternoon before United States Magistrate Judge James M. Wicks.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York; Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI); Vincent F. DeMarco, United States Marshal for the Eastern District of New York; and Errol D. Toulon, Jr., Suffolk County Sheriff, announced the indictment.
“As alleged, through violence, coercion and manipulation, the defendant exploited and demeaned both underage and adult female victims by forcing them to engage in commercial sex acts and posting sexually explicit photographs of them on the internet,” stated Acting U.S. Attorney Lesko. “This Office will use every tool in its law enforcement arsenal to combat the sexual exploitation of women, especially young girls, and ensure that predators like the defendant are prosecuted to the fullest extent of the law.” Mr. Lesko expressed his appreciation to the Nassau County Police Department for their assistance during the investigation.
“Lampley-Reid lured young girls, some as young as 15, with romantic gestures. Once he had them in his grip, it’s alleged that he enslaved these girls and used violence to force them to work as prostitutes for his insidious gain,” stated HSI Special Agent-in-Charge Fitzhugh. “The deplorable actions of this one man will affect the lives of these young girls for years to come. HSI works closely with its law enforcement partners in a victim-centered approach to rescue the victims and keep them safe. Today, we are sending a unified message to anyone perpetrating crimes against children: no matter who you are, we will bring every resource available to hold you accountable for your crimes.”
“The U.S. Marshals Service has a long-standing and extremely successful history of cooperating with our federal, state and local law enforcement partners,” stated Marshal DeMarco. “These law enforcement partnerships enable the Marshals Service to fulfill its mission to keep our communities safe.”
“Sex trafficking is a particularly heinous crime that targets some of the most vulnerable in our communities. Individuals who perpetrate this crime use drugs intimidation and ultimately violence to lure in their victims for financial gain while slowly destroying their lives,” stated Sheriff Toulon. “I applaud this arrest and will continue to support and work closely with both our local and federal partners to help eliminate this scourge from our communities.”
As set forth in court filings, from December 2019 until his arrest yesterday, Lampley-Reid allegedly used violence and the threat of violence to compel the commission of commercial sex acts by numerous women for his financial benefit, including by minors as young as 15-years-old. Lampley-Reid used social media and other internet applications to establish relationships with potential victims, groomed those victims by feigning a romantic interest in them, manipulated them into working for him as prostitutes, and then effectively enslaved them through acts of force and coercion. Lampley-Reid demanded that the proceeds of prostitution “dates” be turned over to him, and any resistance from the victims was met with violence or threats. Lampley-Reid trafficked victims on Long Island, including at motels in East Meadow, Freeport and Rockville Centre, as well as out of state, including locations in Florida, Maryland and North Carolina. He also engaged in sexual intercourse with his victims, including minors, and provided them with illegal narcotics. Lampley-Reid promoted and managed his prostitution business over the Internet, posting sexually exploitative photos of minor victims that he took or persuaded them to take of themselves in order to further his trafficking business.
The charges in the indictment are allegations, and the defendant is presumed innocent unless and until proven guilty. If convicted of sex trafficking of a minor, the defendant faces a mandatory minimum sentence of 15 years’ imprisonment and a maximum of life in prison. If convicted of producing child pornography, he faces a mandatory minimum sentence of 15 years in prison and a maximum of 30 years in prison.
The government’s case is being handled by the Long Island Criminal Division. Assistant United States Attorney Megan E. Farrell is in charge of the prosecution.
The Defendant:
JOSHUA LAMPLEY-REID
Age: 26
West Hempstead, New YorkE.D.N.Y. Docket No. 21-CR-319 (GRB)
Five Individuals, Including Current and Former JetBlue Employees, Charged with Covid-19 Related FraudRead the Press Release
A criminal complaint was unsealed today in federal court in Brooklyn charging Orlando Sanay, Keimi Nunez and his twin brother Keily Nunez, Michael Pimentel Veloz and Fanny Plasencia with wire fraud in connection with false statements they allegedly made to obtain loans pursuant to the Economic Injury Disaster Loan program (“EIDL”). The defendants were arrested today and will make their initial appearances this afternoon before United States Magistrate Judge Roanne L. Mann.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, and Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), announced the arrests and charge.
“As alleged, the defendants brazenly lied and stole more than $1 million in taxpayer funds from a program designed to help small businesses and their employees who were struggling to stay afloat and make ends meet during the pandemic,” stated Acting United States Attorney Lesko. “Our Office will continue to ensure that criminals who divert pandemic-related relief to line their own pockets are held accountable for their greed.”
“It’s alleged that the five arrested today schemed to defraud the government by falsely obtaining over one million dollars in loans from the Economic Injury Disaster Loan program under the COVID Relief Act. This is a team of fraudsters who didn’t just skim from a government agency, but stole much needed relief from the hands of those who depended on it most,” stated HSI Special Agent-in-Charge Fitzhugh. “HSI New York worked closely with IRS--Criminal Investigations, the SBA’s Office of Inspector General and JetBlue Corporate Security to apprehend these individuals and ensure they face the consequences of their actions.”
The EIDL program provides qualifying small businesses with low-interest loans. The Coronavirus Aid, Relief and Economic Security (“CARES”) Act expanded EIDL to provide economic support to help offset the temporary loss of revenue experienced by businesses due to the COVID-19 pandemic.
As alleged in the complaint, between April 2020 and August 2020, the defendants applied for EIDL loans for eight separate entities. In those applications, the defendants falsely represented the number of employees associated with the entities and misstated the gross revenues for the entities for the 12 months prior to the COVID-19 pandemic. For example, Sanay submitted a loan application to the Small Business Association (“SBA”) in July 2020 claiming that he was the owner and chief executive officer of Sanay Venture Capital LLC (“SVC”). In the application, Sanay falsely claimed that SVC had 26 employees, gross revenues of $839,000 and cost of goods sold of $560,000 for the relevant period. Sanay and Keimy Nunez submitted the application from the IP address of their employer, JetBlue Airways, to the SBA’s online portal. The SBA approved SVC’s application and on August 4, 2020 wired $139,400 to Sanay’s personal bank account. In contrast to the claims made in the application, New York Department of Labor records showed that SVC has never reported having any employees. Internal Revenue Service records further reveal that SVC has never filed a tax return since its formation in 2014. There is no evidence to date that the EIDL funds provided to SVC were used for business purposes. Keily Nunez is no longer employed by JetBlue.
Based on these false representations, the Small Business Administration approved more than $1 million in loans that were deposited into the defendants’ bank accounts.
In addition to making false statements to obtain the loans, the defendants did not use the relief funding for ongoing business expenses as the EIDL program requires. Instead, they withdrew hundreds of thousands of dollars in cash from bank accounts that had received EIDL loan funds.
The charge in the complaint is an allegation, and the defendants are presumed innocent unless and until proven guilty. If convicted, the defendants each face up to 20 years’ imprisonment.
The case is being handled by the Office’s Business and Securities Fraud Section. Department of Justice Trial Attorney Patrick J. Campbell is in charge of the prosecution.
The Defendants:
ORLANDO SANAY
Age: 39
Elizabeth, New JerseyKEILY NUNEZ
Age: 41
Jamaica, New YorkKEIMI NUNEZ
Age: 41
Woodhaven, New YorkMICHAEL PIMENTEL VELOZ
Age: 40
Garfield, New JerseyFANNY PLASENCIA
Age: 20
Jamaica, New YorkE.D.N.Y. Docket No. 21-MJ-668
Long Island MS-13 Gang Leader Sentenced to 25 Years’ Imprisonment for Racketeering and Firearms OffensesRead the Press Release
Earlier today, in federal court in Central Islip, Ronald Catalan, a former leader of the Brentwood Locos Salvatruchas (BLS) clique of La Mara Salvatrucha, also known as the MS-13, a transnational criminal organization, was sentenced by United States Circuit Judge Joseph F. Bianco to 25 years’ imprisonment. The sentencing follows Catalan’s guilty plea to racketeering charges, including predicate acts relating to a June 23, 2009 shooting in Brentwood and an October 21, 2015 shooting in Bay Shore that collectively left three victims wounded. Catalan also pleaded guilty to conspiracy to distribute cocaine and marijuana as predicate racketeering acts, as well as illegally using firearms in connection with crimes of violence. Catalan, who was the leader of the BLS clique from 2015 until his federal arrest in July 2017, pleaded guilty in October 2018.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., 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 sentence.
“Catalan will deservedly spend decades in prison for the violent and brutal acts he committed and directed others to carry out as a leader of the MS-13. His ruthless and retaliatory attacks on his so-called ‘rivals’ to enhance his own status in the MS-13 demonstrate his complete and callous disregard for human life,” stated Acting United States Attorney Lesko. “Working with our partners on the FBI’s Long Island Gang Task Force, this Office will continue its relentless pursuit of justice for the victims of the MS-13 and will not rest until the threat they present to the communities in our district is eliminated.”
“Thanks to the relentless efforts of the FBI’s Long Island Gang Task Force and Eastern District of New York, Catalan will be held accountable for his vicious crimes that nearly claimed three lives,” stated Acting SCPD Commissioner Cameron. “The SCPD will continue to work with our law enforcement partners to put an end to gangs in our communities and their senseless violence while continuing to seek justice for MS-13 victims.”
On June 23, 2009, Catalan and two other MS-13 members, all of whom were new members of the BLS clique, armed themselves with handguns and drove through Brentwood, hunting for rival gang members to attack and kill in order to increase their standing in the MS-13 gang. They observed a group of males on Barleau Street whom they believed to be members of the Bloods street gang. The MS-13 members got out of their car, approached the group and started firing. John Doe #1 was struck in the armpit and back as he tried to run. John Doe #1 underwent surgery and ultimately survived the attack.
In addition to shooting John Doe #1, Catalan admitted to participating in the October 21, 2015 attempted murders of two men that occurred on Bancroft Road in North Bay Shore. Catalan and other MS-13 members decided to retaliate against suspected members of the rival Latin Kings gang for the assault of an MS-13 member earlier that day. The MS-13 members, who were armed with two .38 caliber revolvers, drove around Brentwood and Bay Shore and observed a group of people they believed to be Latin Kings. Catalan directed two newer MS-13 members to carry out the shooting and gave them the .38 caliber revolvers. The MS-13 members fired multiple shots before running back to the car and fleeing the scene. Two victims were struck by gunfire, but survived their wounds. Catalan further admitted that, between January 2015 and February 2016, he and other members of the BLS clique conspired to distribute cocaine and marijuana to help finance the MS-13’s operations.
Today’s sentencing 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 and Honduras, but the gang has thousands of members across the United States, comprised primarily of immigrants from Central America. With numerous branches, or “cliques,” the MS-13 is the most violent street gang 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, comprising 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 and Megan Farrell are in charge of the prosecution.
The Defendant:
RONALD CATALAN (also known as “Stranger” and “Extrano”)
Age: 30
Brentwood, New YorkE.D.N.Y. Docket No. 16-CR-403 (S-6)(JFB)
Former CEO of Publicly Traded Company Sentenced to 15 Months’ Imprisonment and Ordered to Pay More Than $1.2 Million in Restitution for Securities Fraud ConspiracyRead the Press Release
Earlier today, in federal court in Brooklyn, Dennis Mancino, the former Chief Executive Officer of HD View 360, Inc., a publicly traded penny stock company that purported to distribute and install security surveillance systems, was sentenced by United States District Judge Kiyo A. Matsumoto to 15 months’ imprisonment for conspiracy to commit securities fraud. Mancino’s conviction stemmed from his participation in a scheme to manipulate the price and trading volume of HD View’s stock, which traded under the ticker symbol HDVW. Mancino was also ordered to pay more than $1.2 million in restitution and $257,000 in forfeiture. Mancino pleaded guilty in September 2019.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, announced the sentencing.
“Today, Mancino has been held accountable for abusing the trust of more than 1,200 of his own investors in order to line his pockets,” stated Acting United States Attorney Lesko. “As this case demonstrates, we remain committed to protecting the investing public and the integrity of the financial markets from fraudulent schemes such as those advanced by the defendant.” Mr. Lesko expressed his thanks to the Federal Bureau of Investigation, New York Field Office, and the United States Securities and Exchange Commission, New York Regional Office and Washington, D.C. Office, for their invaluable efforts in the case.
Between July 2017 and February 2018, Mancino conspired to increase HD View’s stock price by executing numerous fraudulent matched trades designed to create the false appearance that HD View’s stock price had risen as a result of genuine market demand. Once HD View’s stock price increased, the conspirators sold the stock for profit and caused more than $1.2 million in losses to more than 1,200 HD View investors. Mancino also agreed to pay kickbacks to stock brokers who would execute manipulative trades designed to increase the price and trading volume of HD View’s stock.
The case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys David Gopstein and Michael T. Keilty are in charge of the prosecution.
The Defendant:
DENNIS MANCINO
Age: 49
Residence: Miami, FloridaE.D.N.Y. Docket No. 18-CR-296 (KAM)
United States Announces Final Resolution of Violations of Safe Drinking Water Act at New York State ParksRead the Press Release
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, and Walter Mugdan, Acting Regional Administrator of the United States Environmental Protection Agency, Region 2 (EPA), announced today the final resolution of the United States’ claims that the State of New York, the New York State Office of Parks, Recreation and Historic Preservation, and the Palisades Interstate Park Commission (collectively, “Defendants”) violated the Safe Drinking Water Act (the “SDWA”) with respect to 54 Large Capacity Cesspools (“the LCCs”) that discharged untreated sanitary waste into the ground at comfort stations located in parks across New York State. The announcement follows Defendants’ compliance with the terms of an April 2017 Court-ordered Consent Judgment, which required closure of the LCCs and installation of systems at seven parks that reduce the levels of harmful nutrients—including nitrogen—that enter the local groundwater.
Based on Defendants’ compliance with the terms of the Consent Judgment, the parties submitted a stipulation and proposed order requesting that the Court terminate the Consent Judgment.
“Through its implementation of the terms of the Consent Judgment, New York State has complied with the Safe Drinking Water Act and prevented significant amounts of harmful nutrient pollution from entering our groundwater,” stated Acting United States Attorney Lesko. “This Office will continue to vigorously enforce violations of the Safe Drinking Water Act to protect the public from water contamination.”
“Large cesspools are now a thing of the past in New York State’s parks. These polluting sewage handling systems use centuries-old technology that can cause serious pollution of groundwater and drinking water,” stated EPA Acting Regional Administrator Mugdan. “The actions required in the court judgement, including Supplemental Environmental Projects called SEPs that used state-of-the-art technologies at parks across Long Island, dramatically reduced the amount of nitrogen getting into groundwater across New York. These technologies can now serve as best practices for others.”
Congress enacted the SDWA to protect the nation’s drinking water sources, and EPA regulates LCCs to prevent them from contaminating underground sources of drinking water. Under the SDWA regulations, owners and operators of LCCs were required to close them by April 5, 2005. LCCs are cesspools that receive untreated sanitary waste, including human excreta, and are capable of being used by 20 or more persons a day. Such untreated waste is high in harmful nutrients, such as nitrogen, that can compromise ground and surface water quality. Nutrient pollution of the ground and surface waters in and surrounding Suffolk County is a longstanding problem that threatens the area’s water quality and ecosystem.
Many of New York’s public water systems rely on underground sources of water for their supply. Underground injection wells, including cesspools, pose a risk to the public because they can contaminate underground drinking water sources and the public water systems that use those sources. Thirty-six of the LCCs were above the Nassau/Suffolk County Sole Source Aquifer, which supplies most of the drinking water for the population of Long Island. Nine of the LCCs, previously located in Broome and Orange Counties, were above the Clinton Street-Ballpark and the Ramapo Sole Source Aquifers, which supply most of the drinking water for the populations of the Broome and Orange County areas.
Pursuant to the Consent Judgment, which settled claims filed by the United States, Defendants closed the LCCs between 2017 and 2019. The injunctive relief in the settlement had an approximate value of $8.8 million. Defendants also implemented a series of Supplemental Environmental Projects (“SEPs”) at seven Long Island parks which significantly reduce the amount of harmful nutrients, including nitrogen, that enter the local groundwater. These SEPs included urine separation systems, nitrogen-reducing technology, and green technology improvements to stormwater treatment systems. Defendants spent over $3.5 million to implement these projects, which are ongoing.
To date, the SEPs have collectively removed approximately 1,500 pounds of nitrogen from septic system discharges, and they will continue to remove approximately 500 pounds of nitrogen per year. These amounts represent a substantial portion of nitrogen present in the waste waters discharged from the park facilities. For example, the treatment system at Connetquot State Park Preserve was found to remove 88% of the nitrogen from sanitary wastewater. In addition, there is an educational area at Connetquot and Captree State Parks where park visitors can learn about the nitrogen pollution, including sources, effects and solutions and the nitrogen removal technology installed at each of the parks. Visitors of Captree State Park can also learn about green technology, which manages and treats stormwater run-off, and removes 50% of the nitrogen from rain events.
The case is being handled by the Office’s Civil Division. Assistant United States Attorney Matthew Silverman is in charge of the litigation, with assistance from Lauren Fischer, Assistant Regional Counsel, Water and General Law Branch, EPA Region 2, Nicole Kraft, Section Chief, Water Compliance Branch, EPA Region 2, and Lisa Kim Pelcyger, Environmental Engineer, Water Compliance Branch, EPA Region 2.
E.D.N.Y. Docket No. 16-CV-6989 (JMA)
Internal Revenue Service Agent Pleads Guilty to Identity Theft and Wire FraudRead the Press Release
Earlier today, in federal court in Brooklyn, Bryan Cho, also known as “Yong Hee Cho,” a Special Agent with Internal Revenue Service Criminal Investigation, pleaded guilty to 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 investigation. The proceeding took place before United States District Judge Ann M. Donnelly. When sentenced, Cho faces up to 22 years in prison and has agreed to forfeit $394,374.63.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and J. Russell George, Treasury Inspector General for Tax Administration (TIGTA), announced the guilty plea.
According to court filings and facts presented during the plea proceeding, 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, 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 suspect. Cho then lied during an official background investigation when he failed to disclose this conduct and denied having any aliases or foreign interests.
“The defendant shamelessly violated his oath of office, and now he will pay the price for his criminal conduct,” stated Acting United States Attorney Lesko. “While the vast majority of federal law enforcement agents honor the trust placed in them by the public, today’s plea serves as a reminder that this Office will prosecute corrupt agents who abuse their positions for their personal benefit.”
“TIGTA aggressively investigates Internal Revenue Service employees who violate the public’s trust,” stated Treasury Inspector General for Tax Administration George. “Our mission at TIGTA is to protect the integrity of our Nation’s system of tax administration, and we are committed to working with our law enforcement partners to ensure those who endeavor to corrupt Federal tax administration are prosecuted to the fullest extent of the law.”
Cho faces up to 20 years’ imprisonment on the wire fraud count and a mandatory consecutive sentence of two years’ imprisonment on the aggravated identity theft count.
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: 49
New York, New YorkE.D.N.Y. Docket No. 21-CR-40 (AMD)
Russian Cybercriminal Convicted of Defrauding American Companies of Millions of Dollars Through Digital Advertising SchemeRead the Press Release
Earlier today, Aleksandr Zhukov, a Russian national, was convicted by a federal jury in Brooklyn of four counts of a superseding indictment charging him with wire fraud conspiracy, wire fraud, money laundering conspiracy, and money laundering. The charges arose from Zhukov’s sophisticated scheme to defraud brands, ad platforms and others in the U.S. digital advertising industry out of more than $7 million. The verdict followed a three-week trial before United States District Judge Eric R. Komitee.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., 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 verdict.
“Today, after evaluating the evidence and wading through the complexities of digital advertising on the internet, the jury recognized the defendant for who he is — a fraudster who used computer code to steal millions from U.S. companies,” stated Acting U.S. Attorney Lesko. “Zhukov may have thought that he could get away with his fraud by carrying it out from halfway around the world, but this verdict sends a powerful message that U.S. law enforcement will bring such cybercriminals to justice, wherever they are.”
Mr. Lesko thanked the FBI’s Cyber Division and the NYPD for their extraordinary efforts in carrying out the multi-year investigation.
“Aleksandr Zhukov took an old-fashioned fraud into cyberspace to steal millions of dollars from unsuspecting victims. But his guilty verdict, and the meticulous work of the prosecutors from the United States Attorney’s Office in the Eastern District of New York, highlights the vigilance of our NYPD detectives and law enforcement partners in tracking wrongdoers into the digital frontier,” stated NYPD Commissioner Shea.
The internet is, in large part, freely available to users worldwide because it runs on digital advertising: website owners display advertisements on their sites and are compensated for doing so by intermediaries representing businesses seeking to advertise their goods and services to real human customers. In general, digital advertising revenue is based on how many users click or view the ads on those websites. As proven at trial, Zhukov used computer programming and infrastructure spread around the world to exploit the digital advertising industry through fraud. He and his co-conspirators represented to others that they ran legitimate companies that delivered advertisements to real human internet users accessing real internet webpages. In fact, Zhukov and his co-conspirators faked both the users and the webpages: they programmed computers they controlled to load advertisements on fabricated webpages, via an automated program, in order to fraudulently obtain digital advertising revenue. The victims included The New York Times, The New York Post, Comcast, Nestle Purina, the Texas Scottish Rite Hospital for Children, and Time Warner Cable.
The evidence at trial established that between September 2014 and December 2016, Zhukov carried out his digital advertising fraud scheme through a purported advertising network called Media Methane. Media Methane had business arrangements with other advertising networks whereby it received payments in return for placing advertising placeholders (“ad tags”) on websites. Rather than place these ad tags on real publishers’ websites, however, Media Methane rented more than 2,000 computer servers housed in commercial datacenters in Dallas, Texas, and Amsterdam, the Netherlands, and used those datacenter servers to load ads on fabricated websites, “spoofing” more than 6,000 domains. To create the illusion that real human internet users were viewing the advertisements loaded onto these fabricated websites, the defendants programmed the datacenter servers to simulate the internet activity of human internet users: browsing the internet through a fake browser, using a fake mouse to move around and scroll down a webpage, starting and stopping a video player midway, and falsely appearing to be signed into Facebook. Zhukov leased more than 650,000 Internet Protocol (“IP”) addresses, assigned multiple IP addresses to each datacenter server, and then fraudulently registered those IP addresses in the names of U.S. companies like Comcast and Time Warner Cable to make it appear that the datacenter servers were residential computers belonging to American internet users who were subscribed to various residential internet service providers. In discussing the scheme with a co-conspirator, Zhukov boasted about the money he would earn and referred to himself as the “king of fraud.” As a result of this elaborate scheme, the defendant falsified billions of ad views and caused businesses to pay more than $7 million for ads that were never actually viewed by real human internet users. Zhukov was arrested in Bulgaria in November 2018 and extradited to the United States in January 2019.
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 Office extends its appreciation to the Supreme Cassation Prosecution Office of Bulgaria, the Regional Prosecution Office of Varna, the Cybercrime Department of the Bulgarian General Directorate for Combating Organized Crime, the Bulgarian Ministry of Interior Regional Directorate of Varna, and the FBI’s Legal Attaché Office for Bulgaria for their assistance in apprehending defendants in this case.
The Defendant:
ALEKSANDR ZHUKOV
Age: 41
Russian FederationE.D.N.Y. Docket No. 18-CR-633
Queens Pharmacy Owner Sentenced to 36 Months in Prison for Health Care Fraud and Narcotics DistributionRead the Press Release
Earlier today, in federal court in Brooklyn, Harris Hussnain, the owner of a pharmacy in Queens, was sentenced by United States District Court Judge Rachel P. Kovner to 36 months in prison for his participation in a health care fraud conspiracy, distribution of Oxycodone and illegal financial transactions. Hussnain pleaded guilty to the charges in September 2020.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York; Scott Lampert, Special Agent-in- Charge, U.S. Department of Health and Human Services - Office of Inspector General, Office of Investigations, New York Regional Office (HHS-OIG); Ray Donovan, Special Agent-in-Charge, Drug Enforcement Administration, New York Division (DEA), Jonathan D. Larsen, Special Agent-in-Charge, Internal Revenue Service-Criminal Investigation, New York (IRS-CI); Frank Walsh, Acting Medicaid Inspector General, New York State Office of the Medicaid Inspector General (OMIG); and Dermot F. Shea, Commissioner, New York City Police Department (NYPD), announced the sentence.
“Hussnain masqueraded as a health care professional when, in reality, he is a drug-dealing criminal who abused the trust of the Medicare and Medicaid systems, put New Moon Pharmacy’s customers in harm’s way and introduced thousands of Oxycodone pills into the community during an opioid epidemic,” stated Acting United States Attorney Lesko. “With today’s sentence, the defendant has been held accountable for his flagrant falsehoods and fraud.”
“Hussnain brazenly deceived the pharmacy’s customers and threatened their safety in exchange for profit,” stated HHS-OIG Special Agent-in-Charge Lampert. “After inappropriately and dangerously dispensing opioid pills and stealing from Medicare and Medicaid, Hussnain has been brought to justice. OIG continues to work with our law enforcement partners to pursue individuals who endanger beneficiaries and cheat the Federal health care programs on which they depend.”
“The defendant’s past transgressions speak for themselves. What a shame that a pharmacy owner who had the means and the opportunity to serve his community, did quite the opposite all in the name of greed,” stated DEA Special Agent-in-Charge Donovan. “Together with our incredible law enforcement partners, DEA stands committed to protecting our healthcare system from fraud, all while keeping our communities safe. I commend and appreciate all of our partners, as well as our colleagues at the United States Attorney’s Office for their hard work on this investigation.”
“Hussnain has been appropriately punished for his shameful actions and behavior,” stated IRS CI Special Agent-in-Charge Larsen. “His criminal activity not only negatively impacted the finances of our social safety net, but more importantly the lives of those who potentially suffer from addiction.”
“Today’s sentencing is proof positive of the effectiveness of the strong partnerships that exist among city, state, and federal program integrity agencies and law enforcement organizations in combatting those that have fueled the opioid crisis in our communities. The message is abundantly clear to anyone who seeks to line their pockets by exploiting the Medicaid program, particularly at these challenging times: you will be caught and held accountable to the fullest extent of the law,” stated Acting Medicaid Inspector General Walsh.
Between July 2016 and December 2019, Hussnain falsely claimed to be the pharmacist at New Moon Pharmacy in South Richmond Hill. Although Hussnain lawfully owned the business, he was not a licensed pharmacist and was not permitted to dispense prescription medications to patients. Hussnain operated the pharmacy on a daily basis, dispensing prescription medications for years with no medical oversight, including controlled substances and over 10,000 Oxycodone pills, billing Medicare and Medicaid for the medications dispensed. Hussnain paid a co-conspirator, Nisha Diler, a licensed pharmacist, to hold herself out as the full-time pharmacist despite the fact that she visited the pharmacy only sporadically. Hussnain filed, and caused Diler to file, falsified paperwork with government entities in New York State in order to cover up Diler’s absences from New Moon Pharmacy. Between 2016 and 2019, Medicare and Medicaid reimbursed New Moon Pharmacy approximately $3 million for pharmaceutical claims. Hussnain transferred significant amounts of the reimbursed funds to accounts in his and his family’s names. In September 2020, Diler pleaded guilty to conspiring to defraud Medicare and Medicaid and subscribing a false tax return.
The case was brought as part of the Medicare Fraud Strike Force, under the supervision of the Department of Justice Criminal Division’s Fraud Section and the United States Attorney’s Office for the Eastern District of New York. The case is being prosecuted by United States Department of Justice Trial Attorney Miriam L. Glaser Dauermann and Assistant U.S. Attorney Tanisha R. Payne of the Office’s Asset Forfeiture Unit.
The Defendant:
HARRIS HUSSNAIN
Age: 41
Queens, New YorkE.D.N.Y. Docket No. 20-CR-280 (RPK)
Bank Julius Baer Agrees to Pay More than $79 Million for Laundering Money in FIFA ScandalRead the Press Release
Bank Julius Baer & Co. Ltd. (BJB or the Bank), a Swiss bank with international operations, has admitted today in federal court in Brooklyn that it conspired to launder over $36 million in bribes through the United States to soccer officials with the Fédération Internationale de Football Association (FIFA) and other soccer federations, in furtherance of a scheme in which sports marketing companies bribed soccer officials in exchange for broadcasting rights to soccer matches. The proceeding was held before U.S. District Judge Pamela K. Chen.
The Bank made these admissions and entered into a three-year deferred prosecution agreement with the department in connection with a criminal information filed today in the Eastern District of New York charging the Bank with conspiring to commit money laundering. As part of this agreement, the Bank has agreed to pay more than $79 million in penalties (including a fine of $43,320,000 and forfeiture of $36,368,400) to resolve the investigation into its involvement in a money laundering conspiracy that fueled this international soccer bribery scheme.
Jorge Luis Arzuaga, a former BJB relationship manager who worked in the Bank’s Montevideo, Uruguay, and Zurich, Switzerland, offices pleaded guilty in June 2017 for his role in this conspiracy and was sentenced in November 2020. That case was assigned to U.S. District Judge Pamela K. Chen of the Eastern District of New York, as is this case.
“Today’s resolution sends a strong message to all banks and other financial institutions that if they knowingly misuse our financial system to hide their clients’ criminal proceeds or to promote a corrupt scheme, they will be held to account,” said Acting Assistant Attorney General Nicholas L. McQuaid of the Justice Department’s Criminal Division. “From the time of the first FIFA-related indictment, the department has promised to hold accountable the financial institutions involved in this global criminal scheme. We are delivering on that promise.”
“BJB and its employees facilitated bribes and its compliance department turned a blind eye to glaring red flags of money laundering,” said Acting U.S. Attorney Mark J. Lesko for the Eastern District of New York. “This office will hold accountable those corporations or individuals that use the American banking system for corrupt ends. As today’s resolution makes clear, financial institutions that become complicit in their clients’ efforts to launder illicit funds face significant penalties.”
“Bank Julius Baer pursued the profit it could make laundering corrupt funds derived from a criminal scheme run by powerful FIFA officials,” said Assistant Director-in-Charge William F. Sweeney Jr. of the FBI’s New York Field Office. “Their behavior has earned them the equivalent of a red card, and the money the bank now owes the U.S. government is more than double what it admits to laundering. The FBI operates globally with our international partners, and our message to those who may be looking to profit from similar schemes – the penalties for this type of play are steep. Stay within the rules.”
“Bank Julius Baer aided corrupt FIFA officials in laundering over $36 million,” said Special Agent in Charge Ryan L. Korner of the IRS-Criminal Investigation. “Banking officials that are a conduit for criminal activity undermine their own profession and the health of our financial system. The Bank's admissions show that IRS-Criminal Investigation will relentlessly pursue corruption across borders, including financial institutions that facilitate or conceal criminal activity. This should put other banks on notice that aiding in corruption will cost you millions.”
According to admissions in the publicly-filed statement of facts, from approximately February 2013 to May 2015, BJB, through Arzuaga, conspired with sports marketing executives — including Alejandro Burzaco, the controlling executive of Torneos y Competencias S.A. (Torneos), a sports media and marketing company headquartered in Argentina — to launder through the United States at least $36 million in bribes to soccer officials in exchange for broadcasting rights to soccer matches. BJB conspired to execute these illegal transactions through accounts at the Bank to conceal the true nature of the payments and promote the fraud. Burzaco pleaded guilty to racketeering conspiracy and other offenses in November 2015 in connection with his involvement in paying bribes to soccer officials.
For example, Burzaco and co-conspirators agreed to pay approximately $30 million to the senior vice president of FIFA, who was also the president of the Asociación del Fútbol Argentina, for his support in the award of regional broadcasting rights to the 2018, 2022, 2026 and 2030 editions of the World Cup. As part of the conspiracy, BJB, through Arzuaga, transferred approximately $25 million of this money into a sub-account at the Bank and held it there for this senior FIFA official.
Torneos and its co-conspirators also agreed to pay tens of millions of dollars in bribes to several officials of the Confederación Sudamericana de Fútbol (CONMEBOL) — all of whom were also FIFA officials — for the rights to the Copa América tournament (including the 2015, 2019 and 2023 editions of the tournament and the 2016 Copa América Centenario, a commemorative centennial edition of the tournament played at stadiums across the United States). The officials who were to receive bribes included, among others, Eugenio Figueredo, a member of FIFA’s executive committee and former president of both CONMEBOL and the Asociación Uruguaya de Fútbol, the Uruguayan soccer federation; Marco Polo Del Nero, another member of FIFA’s executive committee and a former president of the Confederação Brasileira de Futebol (CBF), the Brazilian soccer federation; and José Maria Marin, a member of multiple FIFA standing committees and another former president of the CBF.
Burzaco and Torneos also paid bribes through BJB to numerous CONMEBOL officials in furtherance of a scheme to obtain the broadcasting rights to the Copa Libertadores tournament. In addition to the aforementioned soccer officials, bribes were also paid to, among others, Juan Ángel Napout, who served as a FIFA Vice President, a member of FIFA’s Executive Committee, and president of CONMEBOL and Romer Osuna, a member of the FIFA audit and compliance committee and former treasurer of CONMEBOL.
At the time of the conduct, BJB’s Anti-Money Laundering (AML) controls failed to detect or prevent money laundering transactions related to the bribery schemes. Had Arzuaga’s supervisors or compliance personnel meaningfully reviewed Arzuaga’s due diligence on Torneos and his responses to transaction alerts, they would have known there were multiple, significant red flags, including facially false contracts, payments to third parties at the direction of a FIFA official, and services purportedly rendered by shell corporations — all of which would have alerted the Bank to the bribery, money laundering or other illegal activity.
According to BJB’s admissions, the Bank knew that Arzuaga’s clients’ accounts were associated with international soccer, which was generally understood to involve high corruption risks. Nevertheless, a BJB executive directed the opening of these accounts be fast tracked in the hope that these clients would provide lucrative business.
As outlined in the deferred prosecution agreement, the department reached this resolution with BJB based on a number of factors, including BJB’s failure to voluntarily disclose the conduct to the department; the nature and seriousness of the conduct including that the Bank played an essential role in this scheme for over two years; and the bank’s prior criminal history. BJB did not receive any cooperation credit because it made misleading representations about relevant facts in the case, which had the effect of hindering the department’s investigation, and it did not come forward with all evidence pertaining to the involvement of senior management. However, the Bank received some credit for its significant effort to remediate its compliance program. Accordingly, the total criminal penalty reflects a five percent reduction off the bottom of the applicable U.S. Sentencing Guidelines fine range.
The agreement announced today is part of an investigation led by the FBI’s New York Field Office and the IRS-Criminal Investigation’s Los Angeles Field Office.
Trial Attorney Christian J. Nauvel of the Bank Integrity Unit of the Criminal Division’s Money Laundering and Asset Recovery Section (MLARS) and Assistant U.S. Attorneys Lauren Howard Elbert, Samuel P. Nitze and Brian D. Morris of the U.S. Attorney’s Office for the Eastern District of New York prosecuted the case. Former MLARS Trial Attorney Michael P. Grady of the U.S. Attorney’s Office for the District of Columbia, the Criminal Division’s Office of International Affairs, the Swiss Federal Office of Justice, and the Swiss Office of the Attorney General provided significant assistance in this matter.
MLARS’s Bank Integrity Unit investigates and prosecutes banks and other financial institutions, including their officers, managers and employees, whose actions threaten the integrity of the individual institution or the wider financial system.
Bank Julius Baer Admits Laundering over $36 Million in Bribes in FIFA CaseRead the Press Release
BROOKLYN, NY – Bank Julius Baer & Co. Ltd. (“BJB” or “the Bank”), a Swiss bank with international operations, admitted today in federal court in Brooklyn that it conspired to launder over $36 million in bribes through the United States to soccer officials with the Fédération Internationale de Football Association (FIFA) and other soccer federations. These bribes were in furtherance of a scheme in which sports marketing companies bribed soccer officials in exchange for broadcasting rights to soccer matches. The proceeding was held before United States District Judge Pamela K. Chen.
The Bank has entered into a three-year deferred prosecution agreement with the government in connection with a criminal information filed today in the Eastern District of New York charging the Bank with conspiring to commit money laundering. As part of this agreement, the Bank has agreed to pay more than $79 million in penalties (including a fine of $43,320,000 and forfeiture of $36,368,400) to resolve the investigation into its involvement in a money laundering conspiracy that fueled this international soccer bribery scheme.
Jorge Luis Arzuaga, a former BJB relationship manager who worked in the Bank’s Montevideo, Uruguay and Zurich, Switzerland offices, pleaded guilty in June 2017 for his role in this conspiracy and was sentenced by Judge Chen to three years’ probation in November 2020.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, Nicholas L. McQuaid, Acting Assistant Attorney General of the Justice Department’s Criminal Division, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Ryan L. Korner, Special Agent-in-Charge, Internal Revenue Service Criminal Investigation, Los Angeles Field Office (IRS CI), announced the agreement.
“BJB and its employees facilitated bribes and its compliance department turned a blind eye to glaring red flags of money laundering,” stated Acting U.S. Attorney Lesko. “This Office will hold accountable those corporations or individuals that use the American banking system for corrupt ends. As today’s resolution makes clear, financial institutions that become complicit in their clients’ efforts to launder illicit funds face significant penalties.”
“Today’s resolution sends a strong message to all banks and other financial institutions that if they knowingly misuse our financial system to hide their clients’ criminal proceeds or to promote a corrupt scheme, they will be held to account,” stated Acting Assistant Attorney General McQuaid. “From the time of the first FIFA-related indictment, the Department has promised to hold accountable the financial institutions involved in this global criminal scheme. We are delivering on that promise.”
"Bank Julius Baer pursued the profit it could make laundering corrupt funds derived from a criminal scheme run by powerful FIFA officials,” stated FBI Assistant Director-in-Charge Sweeney. “Their behavior has earned them the equivalent of a red card, and the money the bank now owes the U.S. government is more than double what it admits to laundering. The FBI operates globally with our international partners, and our message to those who may be looking to profit from similar schemes is simple – the penalties for this type of play are steep. Stay within the rules.”
“Bank Julius Baer aided corrupt FIFA officials in laundering over $36 million. Banking officials that are a conduit for criminal activity undermine their own profession and the health of our financial system,” stated IRS CI Special Agent-in-Charge Korner. “The Bank's admissions show that IRS Criminal Investigation will relentlessly pursue corruption across borders, including financial institutions that facilitate or conceal criminal activity. This should put other banks on notice that aiding in corruption will cost you millions.”
According to admissions in the statement of facts, from approximately February 2013 to May 2015, BJB, through Arzuaga, conspired with sports marketing executives—including Alejandro Burzaco, the controlling executive of Torneos y Competencias, S.A. (Torneos), a sports media and marketing company headquartered in Argentina—and others, to launder through the United States at least $36,368,400 in bribes paid to soccer officials in exchange for broadcasting rights to soccer matches. BJB conspired to execute these illegal transactions through accounts at the Bank to conceal the true nature of the payments and promote the fraud. Burzaco pleaded guilty in November 2015 to racketeering conspiracy and other offenses in connection with his involvement in paying bribes to soccer officials.
For example, Burzaco and co-conspirators agreed to pay approximately $30 million to the senior vice president of FIFA, who was also the president of the Asociación del Fútbol Argentina, for his support in the award of regional broadcasting rights to the 2018, 2022, 2026 and 2030 editions of the World Cup. As part of the money laundering conspiracy, BJB, through Arzuaga, transferred approximately $25 million of this money into a sub-account at the Bank and held it there for this senior FIFA official.
Torneos and its co-conspirators also agreed to pay tens of millions of dollars in bribes to several officials of the Confederación Sudamericana de Fútbol (CONMEBOL)—all of whom were also FIFA officials—for the rights to the Copa América tournament (including the 2015, 2019, and 2023 editions of the tournament, and the 2016 Copa América Centenario, a commemorative centennial edition of the tournament played at stadiums across the United States). The officials who were to receive bribes included, among others: Eugenio Figueredo, a member of FIFA’s executive committee and former president of both CONMEBOL and the Asociación Uruguaya de Fútbol, the Uruguayan soccer federation; Marco Polo Del Nero, another member of FIFA’s executive committee and a former president of the Confederação Brasileira de Futebol (“CBF”), the Brazilian soccer federation; and José Maria Marin, a member of multiple FIFA standing committees, and another former president of the CBF.
Burzaco and Torneos also paid bribes through BJB to numerous CONMEBOL officials in furtherance of a scheme to obtain the broadcasting rights to the Copa Libertadores tournament. In addition to the aforementioned soccer officials, bribes were also paid to, among others: Juan Ángel Napout, who served as a FIFA Vice President, a member of FIFA’s Executive Committee, and president of CONMEBOL, and Romer Osuna, a member of the FIFA audit and compliance committee and former treasurer of CONMEBOL.
At the time of the conduct, BJB’s Anti-Money Laundering (“AML”) controls failed to detect or prevent money laundering transactions related to the soccer bribery schemes. Had Arzuaga’s supervisors or compliance personnel meaningfully reviewed Arzuaga’s due diligence on Torneos and his responses to transaction alerts, they would have known there were multiple, significant red flags, including facially false contracts, payments to third parties at the direction of a FIFA official, and services purportedly rendered by shell corporations—all of which would have alerted the Bank to the bribery, money laundering, or other illegal activity.
According to BJB’s admissions, the Bank knew that Arzuaga’s clients’ accounts were associated with international soccer, which was generally understood to involve high corruption risks. Nevertheless, a BJB executive directed the opening of these accounts be fast-tracked in the hope that these clients would provide lucrative business.
As outlined in the agreement, the Department reached this resolution with BJB based on a number of factors, including BJB’s failure to voluntarily disclose the conduct to the Department; the nature and seriousness of the conduct, including that the bank played an essential role in this scheme for over two years; and the bank’s prior criminal history. BJB did not receive any cooperation credit because it made misleading representations about relevant facts in the case, which had the effect of hindering the Department’s investigation, and it did not come forward with all evidence pertaining to the involvement of senior management. However, the Bank received some credit for its significant efforts to remediate its compliance program. Accordingly, the total criminal penalty reflects a five percent reduction off the bottom of the applicable U.S. sentencing guidelines fine range.
The agreement announced today is part of an investigation led by the U.S. Attorney’s Office for the Eastern District of New York, the FBI’s New York Field Office and the IRS-CI’s Los Angeles Field Office. Assistant U.S. Attorneys Lauren Howard Elbert, Samuel P. Nitze and Brian D. Morris of the U.S. Attorney’s Office and Trial Attorney Christian J. Nauvel of the Bank Integrity Unit in the Criminal Division’s Money Laundering and Asset Recovery Section (MLARS) prosecuted the case. Assistant United States Attorney Michael P. Grady of the U.S. Attorney’s Office for the District of Columbia (former MLARS attorney), the Criminal Division’s Office of International Affairs, the Swiss Federal Office of Justice, and the Swiss Office of the Attorney General provided significant assistance in this matter.
The Defendant:
BANK JULIUS BAER & CO. LTD.
Zurich, Switzerland
E.D.N.Y. Docket No. 21-CR-273 (PKC)Two Individuals Indicted for Money Laundering Related to Odebrecht Bribery and Fraud SchemeRead the Press Release
Earlier today, in federal court in Brooklyn, an indictment was unsealed charging Peter Weinzierl and Alexander Waldstein, both citizens of Austria, for their roles in a scheme to launder hundreds of millions of dollars through the U.S. financial system on behalf of Odebrecht S.A. (Odebrecht), a Brazil-based global construction conglomerate, in order to pay bribes around the world and defraud the Brazilian government. Weinzierl was arrested earlier today in the United Kingdom pursuant to a provisional arrest request from the United States. Waldstein remains at large.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, Nicholas L. McQuaid, Acting Assistant Attorney General, U.S. Justice Department’s Criminal Division, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the indictment and arrest.
“As alleged, the defendants, high-ranking officials at an Austrian bank, brazenly assisted a large corporation in laundering millions of dollars through the United States financial system as part of a scheme to commit tax fraud on the Brazilian government,” stated Acting U.S. Attorney Lesko. “This Office is committed to protecting the integrity of the U.S. financial system and will hold accountable those who seek to misuse it to defraud a foreign government.” Mr. Lesko thanked the Department of Justice’s Criminal Division and the FBI for their work on the investigation.
As alleged in the indictment, Weinzierl served as chief executive officer and Waldstein served as an officer of an Austrian bank (the “Austrian Bank”), and both served as board members of an Antiguan bank (the “Antiguan Bank”). In and about and between 2006 and 2016, Weinzierl and Waldstein conspired with Odebrecht and others to launder money in a scheme to defraud Brazil’s tax authority of more than $100 million in taxes and to create off-books slush funds used by Odebrecht to pay hundreds of millions of dollars in bribes for the benefit of public officials around the world.
Specifically, Weinzierl, Waldstein, and their co-conspirators allegedly used fraudulent transactions and sham agreements to move more than $170 million from bank accounts in New York held in the name of Odebrecht, through the Austrian Bank, to offshore shell company bank accounts secretly owned and controlled by Odebrecht. As part of the scheme, Odebrecht used the slush funds funneled to the offshore shell company bank accounts to pay bribes. Odebrecht falsely recorded the hundreds of millions of dollars in international wire transfers sent to the Austrian Bank as legitimate business expenses and deducted the fraudulent payments from the overall profits that it reported in Brazil, thus reducing its tax liability and evading more than $100 million in taxes. Shell company bank accounts that were involved in the scheme, and used to pay bribes to foreign officials, were held at the Antiguan Bank, which was controlled by Weinzierl, Waldstein, and their co-conspirators and used to promote the scheme. Weinzierl and Waldstein also caused millions of dollars in criminal proceeds to be transferred from the Antiguan Bank to a brokerage account located in the United States to purchase U.S. Treasury securities and corporate stocks and bonds on U.S. exchanges. In exchange for their roles in the scheme, Weinzierl and Waldstein demanded and collected substantial fees for the benefit of the Austrian Bank and the Antiguan Bank.
The charges in the indictment are allegations, and the defendants are presumed innocent unless and until proven guilty.
The FBI’s International Corruption squad in New York is investigating this case. Assistant U.S. Attorney Julia Nestor of the U.S. Attorney’s Office for the Eastern District of New York, Trial Attorney Michael Culhane Harper of the Criminal Division’s Fraud Section and Trial Attorney Michael B. Redmann of the Criminal Division’s Money Laundering and Asset Recovery Section are prosecuting the case. The Justice Department’s Criminal Division and United Kingdom authorities provided significant assistance.
The Defendants:
PETER WEINZIERL
Age: 55
AustriaALEXANDER WALDSTEIN
Age: 73
AustriaE.D.N.Y. Docket No. 20-CR-383 (RJD)
Two Bank Executives Charged for Conspiring to Launder Hundreds of Millions of Dollars Through U.S. Financial System in Connection with Odebrecht Bribery and Fraud SchemeRead the Press Release
An Austrian man was arrested today in the United Kingdom on criminal charges related to his alleged participation in a conspiracy to launder hundreds of millions of dollars through the U.S. financial system as part of a scheme to pay bribes around the world and defraud the Brazilian government.
The indictment unsealed today was previously returned by a federal grand jury in Brooklyn, New York, and charges Peter Weinzierl, 55, and Alexander Waldstein, 73, both of Austria, for their role in a massive money laundering scheme involving Odebrecht S.A. (Odebrecht), a Brazil-based global construction conglomerate. Weinzierl was arrested today in the United Kingdom pursuant to a provisional arrest request from the United States. Waldstein remains at large.
Weinzierl served as chief executive officer and Waldstein as officer of an Austrian bank, and both served as board members of an Antiguan bank. According to the indictment, between approximately 2006 and 2016, Weinzierl and Waldstein conspired with Odebrecht and others to launder money in a scheme to defraud Brazil’s tax authority of more than $100 million in taxes and to create off-books slush funds used by Odebrecht to pay hundreds of millions of dollars in bribes for the benefit of public officials around the world.
According to the indictment, Weinzierl, Waldstein, and their co-conspirators used fraudulent transactions and sham agreements to move more than $170 million from bank accounts in New York held in the name of Odebrecht, through the Austrian bank, to offshore shell company bank accounts secretly controlled by Odebrecht. As part of the scheme, Odebrecht used the slush funds funneled to the offshore shell company bank accounts to pay bribes. Odebrecht falsely recorded the hundreds of millions of dollars in international wire transfers sent to the Austrian bank as legitimate business expenses and deducted the fraudulent payments from the overall profits that it reported in Brazil, thus reducing its tax liability and evading more than $100 million in taxes. Shell company bank accounts involved in the scheme and used to pay bribes to foreign officials were held at the Antiguan bank that Weinzierl, Waldstein, and their co-conspirators controlled and used to promote the scheme. Weinzierl and Waldstein also caused millions of dollars in criminal proceeds to be transferred from the Antiguan bank to a brokerage account located in the United States to purchase U.S. Treasury securities and corporate stocks and bonds on U.S. exchanges. In exchange for their role in the scheme, Weinzierl and Waldstein collected substantial fees for the benefit of the Austrian and Antiguan banks.
On Dec. 21, 2016, Odebrecht pleaded guilty in federal court in Brooklyn 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.
Weinzierl and Waldstein are charged with one count of conspiracy to commit money laundering and two counts of international promotional money laundering. Weinzierl is also charged with one count of engaging in a transaction in criminally derived property. If convicted of all counts, Weinzierl and Waldstein would face a maximum penalty of 70 and 60 years in prison, respectively. A federal district court judge in Brooklyn will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Acting Assistant Attorney General Nicholas L. McQuaid of the Justice Department’s Criminal Division; Acting U.S. Attorney Mark J. Lesko for the Eastern District of New York; and Assistant Director in Charge William F. Sweeney Jr. of the FBI’s New York Field Office made the announcement.
The FBI’s International Corruption squad in New York is investigating this case.
Trial Attorney Michael Culhane Harper of the Criminal Division’s Fraud Section, Trial Attorney Michael B. Redmann of the Criminal Division’s Money Laundering and Asset Recovery Section, and Assistant U.S. Attorney Julia Nestor of the U.S. Attorney’s Office for the Eastern District of New York are prosecuting the case. The Justice Department’s Office of International Affairs and UK authorities provided significant assistance.
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 the Criminal Division’s Money Laundering and Asset Recovery Section 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.
Brooklyn Man Arrested for Arson of Yeshiva and SynagogueRead the Press Release
A criminal complaint has been filed in federal court in Brooklyn charging Ali Alaheri with setting fire to a yeshiva and synagogue in Brooklyn on May 19, 2021. Alaheri was arrested in Dobbs Ferry, New York, yesterday and will make his initial appearance this afternoon before United States Magistrate Judge Vera M. Scanlon.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York; John B. DeVito, Special Agent-in-Charge, Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF); Dermot Shea, Commissioner, New York City Police Department (NYPD); and Daniel A. Nigro, Commissioner, New York City Fire Department (FDNY), announced the arrest and charge.
“As alleged in the complaint and detention letter, Alaheri deliberately set fire to the sacred home of a yeshiva and synagogue, and viciously attacked a man wearing traditional Hasidic garb, demonstrating a violent hatred that cannot be tolerated,” stated Acting U.S. Attorney Lesko. “This Office strongly condemns these sorts of intentional acts of violence and we will go to every length possible to prosecute this type of conduct to the fullest extent possible.” Mr. Lesko praised the special agents, detectives and fire marshals of the Strategic Explosive and Arson Response Task Force for their outstanding investigative work on the case.
“The defendant’s alleged actions endangered the lives of numerous individuals, from the congregants and students at the synagogue and yeshiva, to the first responders who arrived to extinguish the flames, to the neighboring members of the community,” stated ATF Special Agent-in-Charge DeVito. “The members of ATF’s Arson and Explosives Task Force, in partnership with NYPD’s Hate Crime Unit, worked diligently to quickly identify the defendant and bring him to justice. I thank them for their efforts, as well as those of the U.S. Attorney’s Office, in sending a clear message that crimes such as this will not be tolerated.”
“Ali Alaheri, as alleged in today’s federal complaint, set fire to a school and religious institution and threatened public safety for all. I commend our NYPD investigators, our government partners and the prosecutors in the United States Attorney’s Office for the Eastern District of New York for their work in bringing swift justice in this case,” stated NYPD Commissioner Shea.
“Arson is a callous and senseless crime that endangers the lives of innocent residents and our firefighters who bravely respond to protect life and property,” stated FDNY Commissioner Nigro. “I commend our Fire Marshals and their partners in law enforcement for their outstanding efforts to investigate this incident and apprehend the suspect.”
As set forth in the complaint and detention letter, in the pre-dawn hours of May 19, 2021, Alaheri was captured on surveillance video piling garbage bags against the side of a building on 36th Street in Brooklyn that housed a yeshiva (a Jewish school) and a synagogue. Alaheri was recorded igniting the garbage bags. Firefighters responded to a fire alarm at the location and extinguished the blaze. Several hours later, Alaheri was again captured on surveillance video, this time repeatedly punching a man wearing traditional Hasidic garb. There was no interaction between Alaheri and the victim prior to the assault. When Alaheri was arrested on May 21, 2021, he appeared to be wearing the same clothing he was wearing in the video footage of the assault.
The charge in the complaint is an allegation, and the defendant is presumed innocent unless and until proven guilty. If convicted, Alaheri faces a mandatory minimum sentence of five years’ imprisonment, and a maximum of 20 years’ imprisonment.
The government’s case is being handled by the Office’s Civil Rights Section. Assistant United States Attorney Rachel A. Bennek is in charge of the prosecution.
The Defendant:
ALI ALAHERI
Age: 29
Brooklyn, New YorkE.D.N.Y. Docket No. 21-MJ-624
Queens Man Charged with Eight Robberies of Grocery Stores and Other BusinessesRead the Press Release
A complaint was unsealed today in federal court in Brooklyn charging Manuel Guzman Breton with eight counts of Hobbs Act robbery in connection with the robberies of eight grocery stores, laundromats, and other businesses during the month of April 2021. An employee was injured during one of the robberies.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, John B. DeVito, Special Agent-in-Charge, U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), and Dermot F. Shea, Commissioner, New York City Police Department (NYPD), announced the arrest and charges.
“As alleged, Guzman Breton embarked on a one-man crime spree to rob and terrorize hard-working store clerks and employees while armed with a knife or a boxcutter,” stated Acting U.S. Attorney Lesko. “This Office and our partners at the ATF and the NYPD relentlessly pursued this serial armed robber and, by bringing him to justice, stopped him from inflicting further harm on businesses in our communities.” Mr. Lesko expressed his appreciation to the NYPD detectives and ATF special agents assigned to the ATF/NYPD Robbery Task Force for their investigative work.
“ATF is committed to the investigation and prosecution of violent and dangerous offenders in order to make our communities safer,” stated ATF Special Agent-in-Charge DeVito. “The defendant’s alleged violent crime spree has been stopped as a result of that commitment. We thank the NYPD and the U.S. Attorney’s Office for their continued partnership and their dedication to the safety of New York City’s residents and businesses.”
As set forth in the complaint and as captured on video surveillance, between April 7, 2021 and April 27, 2021, Guzman Breton, wearing a hooded sweatshirt, committed a spree of robberies in which he entered each store, threatened employees with a knife or boxcutter, and stole thousands of dollars from his victims. An employee of a laundromat suffered cuts on the hand trying to wrest a knife away from the defendant during one of the robberies.
The charges in the indictment are allegations, and the defendant is presumed innocent unless and until proven guilty. If convicted, Guzman Breton faces up to 20 years in prison.
The complaint charges Guzman Breton with the following robberies, all in Queens:
- Grocery store on Corona Avenue in Corona on April 7, 2021.
- Grocery store on 74th Street in Jackson Heights on April 10, 2021.
- Grocery store on Astoria Boulevard in East Elmhurst on April 12, 2021.
- Grocery store on Roosevelt Avenue in Woodside on April 16, 2021.
- Grocery store on Hampton Street in Elmhurst on April 19, 2021.
- Laundromat on 81st Street in Jackson Heights on April 25, 2021.
- Laundromat on Elmhurst Avenue in Elmhurst on April 26, 2021.
- Clothing store on 37th Avenue in Jackson Heights on April 27, 2021.
The government’s case is being handled by the Office’s General Crimes Section. Assistant United States Attorney Ellen H. Sise is in charge of the prosecution.
The Defendant:
MANUEL GUZMAN BRETON
Age: 31
Queens, New YorkE.D.N.Y. Docket No. 21-MJ-603
Brooklyn Lawyer Pleads Guilty to Defrauding Real Estate InvestorsRead the Press Release
Earlier today, in federal court in Brooklyn, Shimon Rosenfeld, an attorney licensed to practice in New York, pleaded guilty to defrauding investors of at least $6 million by falsely claiming he was using the money to invest in real estate opportunities. The proceeding was held before United States District Judge Kiyo A. Matsumoto.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Patrick J. Freaney, Deputy Special Agent-in-Charge, United States Secret Service, New York Field Office (USSS), announced the guilty plea.
“The defendant, a licensed lawyer, swindled his investors by claiming he was ‘flipping’ properties, when in reality the only thing he flipped was their millions of dollars in investments into his own personal bank accounts,” stated Acting United States Attorney Lesko. “It is particularly egregious that the defendant perpetrated this fraud scheme as a member of the bar who betrayed the trust of victims who believed his lies.” Mr. Lesko thanked the FBI for their outstanding investigative work on the case.
“The U.S. Secret Service, working in conjunction with our law enforcement partners, is dedicated to bringing those who commit financial crimes to justice,” stated USSS Deputy Special Agent-in-Charge Freaney. “The defendant used his position as an attorney to defraud victims who believed they were investing in real estate, when in actuality the defendant was misappropriating the funds for his personal gain. Due to the diligent investigative efforts of the Secret Service and FBI, the defendant has been brought to justice in the Eastern District of New York and will face the appropriate consequences for his actions.”
Between May 2014 and March 2018, Rosenfeld perpetrated a fraudulent scheme by soliciting and receiving approximately at least $6 million from various individuals (the “Victims”) based on fraudulent misrepresentations. Specifically, Rosenfeld induced the Victims to invest their money with him based, in part, on representations that he would purchase real estate and sell it to a prospective buyer at a higher price, also referred to as “flipping” the property. Rosenfeld told the Victims that he would split the profits from the real estate transactions with the Victims. In reality, Rosenfeld misappropriated the victim investors’ money, directing the funds into bank accounts he controlled and using the money to trade securities out of his brokerage account.
The government’s case is being handled by the Office’s Business & Securities Fraud Section. Assistant United States Attorney Hiral D. Mehta is in charge of the prosecution, assisted by Special Agent Martin Sullivan of the Eastern District of New York.
The Defendant:
SHIMON ROSENFELD
Age: 59
Brooklyn, New YorkE.D.N.Y. Docket No. 21-CR-236 (KAM)
Russian Citizen Sentenced to 60 Months’ Imprisonment for Cyber Tax Fraud SchemeRead the Press Release
Earlier today, in federal court in Brooklyn, Anton P. Bogdanov, a citizen of Russia, was sentenced by United States Chief District Judge Margo K. Brodie to 60 months’ imprisonment for wire fraud conspiracy and computer intrusions in connection with a scheme in which he and others hacked into private tax preparation firms, stole personal information, used that information to file federal tax returns and fraudulently attempted to obtain more than $1.5 million in tax refunds from the Department of the Treasury. The Court also ordered Bogdanov to pay $476,713 in forfeiture. Bogdanov was arrested in Bangkok, Thailand in November 2018, extradited to the United States in March 2019 and pleaded guilty in January 2020.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Jonathan D. Larsen, Acting Special Agent-in-Charge, Internal Revenue Service-Criminal Investigation, New York (IRS-CI), announced the sentence.
“Bogdanov hacked into tax preparation firms and used illegally obtained private information from innocent victims to try to steal their federal income tax refunds for his own use,” stated Acting United States Attorney Lesko. “Today’s sentence underscores the commitment of this Office to protecting the integrity of private tax return information and holding corrupt hackers like the defendant accountable for his crimes.”
“Victims in this investigation may have thought justice would be elusive when they learned Bogdanov and his cohorts were in Russia. Today's result should serve as a reminder that our reach is global, and we are laser-focused on stopping cyber criminals wherever they may try to hide,” stated FBI Assistant Director-in-Charge Sweeney.
“Bogdanov utilized sophisticated means to steal two valuable commodities, peoples personally identifiable information and funds belonging to the American Taxpayer, stated IRS-CI Special Agent-in-Charge Larsen. “IRS-Criminal Investigation will continue to work side-by-side with our law enforcement partners to identify and prosecute international cyber criminals who infiltrate our tax system for personal gain. Justice was served in today’s sentence and should serve as a warning that cyber-criminals cannot hide anonymously beyond our borders.”
Between June 2014 and November 2016, Bogdanov, who used the online moniker “Kusok,” and his co-conspirators misappropriated personally identifiable information (“PII”), such as Social Security numbers and the dates of birth of their victims, by gaining unauthorized access to the computer systems of private tax preparation firms in the United States. Bogdanov and his co-conspirators then changed the tax return information so that the refunds were paid to prepaid debit cards that they controlled. Bogdanov and his co-conspirators also used misappropriated PII to obtain prior tax filings of victims from the IRS Transcript System website, and filed new tax returns, purportedly on behalf of the victims, so that refunds were paid to prepaid debit cards under their control. The debit cards were cashed out in the United States, and a percentage of the proceeds was wired to Bogdanov in Russia.
The government’s case is being handled by the Office’s National Security and Cybercrime Section. Assistant United States Attorney Jonathan E. Algor is in charge of the prosecution.
The Justice Department’s Office of International Affairs, the FBI’s Legal Attaché abroad and foreign authorities provided critical assistance in this case. The Office extends its appreciation to the Royal Thai Police, particularly the Crime Suppression Division, and the FBI’s Legal Attaché Bangkok for their assistance in apprehending the defendant. The Office also extends its appreciation to the New York County District Attorney’s Office for their assistance in this case.
The Defendant:
ANTON P. BOGDANOV (also known as “Kusok”)
Age: 35
RussiaE.D.N.Y. Docket No. 19-CR-197 (MKB)
Former New York City Department of Buildings Inspector Pleads Guilty in Bribery SchemeRead the Press Release
Earlier today, in federal court in Brooklyn, Francesco Ginestri, a former New York City Department of Buildings (DOB) Inspector, pleaded guilty to solicitation and receipt of a bribe in exchange for his agreement to ensure that DOB would not issue a fine in connection with a stop work order. The proceeding was held before United States Magistrate Judge Sanket J. Bulsara.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, announced the guilty plea.
“With today’s guilty plea, Ginestri admits to selling his position as a building inspector in exchange for cash and to violating the public trust to ensure the safety of city construction sites,” stated Acting United States Attorney Lesko. “This Office will vigorously prosecute corrupt employees who put their official positions up for sale and endanger the safety of their communities.” Mr. Lesko thanked the Federal Bureau of Investigation, New York Field Office, U.S. Department of Labor, Office of Inspector General, and the New York City Department of Investigation, for their investigative work on the case.
In late July 2020, Ginestri, who was employed as a New York City Department of Buildings Inspector, conducted a re-inspection of a construction site located in Queens that had received a stop work order for safety violations earlier in the month. During the re-inspection, Ginestri learned that construction had continued despite the pendency of the stop work order. Instead of seeking to impose a penalty on the company for violating the stop work order, Ginestri solicited a $1,200 cash bribe in exchange for his agreement to ensure that the DOB would not issue a $25,000 fine to the company. Ginestri resigned from the DOB on February 10, 2021, the day he was arrested.
The government’s case is being handled by the Office’s Public Integrity Section. Assistant United States Attorneys Tanya Hajjar and Alicia N. Washington are in charge of the prosecution.
The Defendant:
FRANCESCO GINESTRI
Age: 37
Queens, New YorkE.D.N.Y. Docket No. 21-263 (ERK)
Eight Brooklyn Individuals Charged with Multi-Million Dollar Covid-19 Relief FraudRead the Press Release
A criminal complaint was unsealed today in federal court in Brooklyn charging Bryan Abraham, Carlos Vazquez, Angel Cabrera, Armani Miller, Johan Santos, Gianni Stewart, Andre Ruddock and Seth Golding with conspiracy to commit access device fraud in connection with a scheme to obtain millions of dollars in unemployment insurance benefits funded, in whole or in part, by COVID-19 pandemic assistance programs. Six defendants were arrested this morning and will make their initial appearance this afternoon before United States Magistrate Judge Ramon E. Reyes. Miller and Santos remain at large.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York; Philip R. Bartlett, Inspector-in-Charge, United States Postal Inspection Service, New York Division (USPIS); Nikitas Splagounias, Acting Special Agent-in-Charge, U.S. Department of Labor, Office of Inspector General, New York Region (DOL-OIG); and Roberta Reardon, Commissioner, New York State Department of Labor (NYS DOL), announced the arrests and charges.
“As alleged, the defendants not only fraudulently obtained $2 million in pandemic-related unemployment benefits using information from third-party victims, they audaciously displayed the proceeds of their fraud – large amounts of stolen cash – on social media,” stated Acting United States Attorney Lesko. “This Office will not hesitate to bring the full weight of the law against defendants who would pocket public funds that are intended to alleviate the hardship of others.” Mr. Lesko also expressed his grateful appreciation to the New York City Police Department for their assistance during the investigation.
“Unfortunately, as the government rolled out various CARES Act programs, fraudsters were ‘At the Ready’ to take full advantage of these programs through a variety of fraud schemes, ripping off the American public of millions in taxpayer dollars, and clogging the system for those who honestly are in need. These arrests are an example of the commitment of law enforcement to bring those to justice for scamming the system” stated USPIS Inspector-in-Charge Bartlett.
“An important mission of the Office of Inspector General is to investigate allegations relating to pandemic-related unemployment benefits. We will continue to work with our law enforcement partners to investigate these types of allegations,” stated DOL-OIG Acting Special Agent-in-Charge Splagounias.
“There is never an excuse to knowingly commit fraud and steal from a system that was designed to help New Yorkers in a time of need,” stated NYS DOL Commissioner Reardon. “However, it’s even more despicable when these thieves steal a lifeline from New Yorkers in the midst of a public health pandemic. We have no tolerance for criminals, and if you break the law, you will be held accountable. I commend our partners in the U.S. Attorney’s Office and all levels of law enforcement for their commitment to helping us fight Unemployment Insurance fraud.”
In response to the COVID-19 pandemic, Congress has enacted laws to establish programs and provide additional funding for unemployment insurance benefits for unemployed persons. These include the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), signed into law on March 27, 2020, which created programs for pandemic unemployment assistance and federal pandemic unemployment compensation.
As alleged in the complaint, between June 2020 and April 2021, the defendants submitted fraudulent claims to the New York State Department of Labor for unemployment insurance benefits. They used the personal identifying information of third-party victims to fraudulently receive unemployment insurance benefits funded, in whole or in part, by COVID-19 pandemic assistance programs. The defendants’ scheme allegedly resulted in approximately $2 million in unemployment benefits being distributed to the defendants and others. Cabrera, Golding, Stewart and Vazquez posted photos of themselves on social media in which they were holding and fanning out large sums of cash.
The charges in the complaint are allegations, and the defendants are presumed innocent unless and until proven guilty.
The government’s case is being handled by the Office’s General Crimes Section. Assistant United States Attorney Tara McGrath is in charge of the prosecution with assistance from Assistant United States Attorney Brendan G. King of the Office’s Asset Forfeiture Section.
The Defendants:
BRYAN ABRAHAM
Age: 18
Brooklyn, New YorkCARLOS VASQUEZ
Age: 20
Brooklyn, New YorkANGEL CABRERA
Age: 18
Brooklyn, New YorkARMANI MILLER
Age: 24
Brooklyn, New YorkJOHAN SANTOS
Age: 19
Brooklyn, New YorkGIANNI STEWART
Age: 19
Brooklyn, New YorkANDRE RUDDOCK
Age: 25
Brooklyn, New YorkSETH GOLDING
Age: 18
Brooklyn, New YorkE.D.N.Y. Docket No. 21-MJ-593
Brooklyn Doctor Pleads Guilty to Illegal Distribution of NarcoticsRead the Press Release
Earlier today, in federal court in Brooklyn, Kesler Dalmacy, a medical doctor, pleaded guilty to illegal distribution of controlled substances. Dalmacy, who operated his medical practice out of an office in East Flatbush, prescribed narcotics to patients outside the course of his professional practice that lacked a legitimate medical purpose in exchange for cash payments. The proceeding was held before United States District Judge Ann M. Donnelly.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, Ray Donovan, Special Agent-in-Charge, Drug Enforcement Administration, New York Division (DEA), Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), Dermot F. Shea, Commissioner, New York City Police Department (NYPD), and Kevin P. Bruen, Acting Superintendent, New York State Police (NYSP), announced the guilty plea.
“The defendant, a medical doctor who swore an oath to do no harm, spread the scourge of addiction in our communities by writing bogus prescriptions for personal profit,” stated Acting United States Attorney Lesko. “This Office, in partnership with the DEA, HSI, NYPD and NYSP, will spare no effort in combatting the illegal distribution of addictive drugs, and in holding medical professionals like the defendant accountable to the fullest extent of the law.” Mr. Lesko also thanked the U.S. Department of Health and Human Services (HHS) and the New York State Department of Health’s Bureau of Narcotic Enforcement for their assistance during the investigation.
“Another day, another doctor disguised as a drug dealer. The defendant not only prescribed highly addictive controlled substances without a legitimate medical need, but also went out of his way to attempt to evade law enforcement. Today’s plea demonstrates that the defendant is taking responsibility for betraying the trust of his patients, his community, and his oath,” stated DEA Special Agent-in-Charge Donovan. “I commend the New York Division, Organized Crime Drug Enforcement Strike Force, Tactical Diversion Squad, the U.S Attorney’s Office for the Eastern District of New York, and our many law enforcement partners for their dedication, hard-work, and attention to the investigation and prosecution of this defendant.”
“The opioid epidemic our country continues to battle is exacerbated when unscrupulous individuals seek to profit from those struggling with addiction,” stated HSI Special Agent-in-Charge Fitzhugh. “The defendant exploited the weaknesses of fellow human beings in order to line his own pockets. HSI and our law enforcement partners remain steadfast in our pursuit to safeguard the public and hold individuals like Dr. Dalmacy accountable.”
“The primary work of a medical practitioner is to help patients. The work of this doctor did nothing but harm his victims, with no regard for their health. By taking payment for prescriptions, Dr. Dalmacy put his patients and the community he served at risk. I thank our law enforcement partners involved in this investigation, and together we will work to keep drugs off our streets, prevent prescription drug abuse and senseless deaths,” stated NYSP Acting Superintendent Bruen.
As set forth in the criminal complaint and court filings, between January 2014 and February 2020, Dr. Dalmacy illegally prescribed to patients thousands of pills of highly addictive controlled substances, including Adderall and Vicodin, in exchange for cash payments. Dr. Dalmacy wrote these prescriptions outside the course of his professional practice and without a legitimate medical purpose. To conceal the unauthorized prescriptions from law enforcement and oversight agencies, Dr. Dalmacy postdated prescriptions and provided multiple prescriptions to the same individual under different or fictitious names.
The arrest of Dr. Dalmacy 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.
This case is the latest in a series of federal prosecutions by the United States Attorney’s Office for the Eastern District of New York as part of the Prescription Drug Initiative. In January 2012, this Office and the DEA, in conjunction with the five District Attorneys in this district, the Nassau and Suffolk County Police Departments, the NYPD and the New York State Police, along with other key federal, state and local government partners, launched the Initiative to mount a comprehensive response to what the HHS Centers for Disease Control and Prevention called an epidemic increase in the abuse of so-called opioid analgesics. To date, the Initiative has brought over 160 federal and local criminal prosecutions, including the prosecution of 20 health care professionals; taken civil enforcement actions against a hospital, a pharmacy and pharmacy chain; removed prescription authority from numerous rogue doctors; and expanded information-sharing among enforcement agencies to better target and pursue drug traffickers. The Initiative also is involved in an extensive community outreach program to address the abuse of pharmaceuticals.
The government’s case is being prosecuted by Assistant United States Attorneys Julia Nestor and Dylan A. Stern.
The Defendant:
DR. KESLER DALMACY
Age: 70
Brooklyn, New YorkE.D.N.Y. Docket No. 21-CR-258 (AMD)
Long Island Investment Advisor Pleads Guilty to Securities Fraud ConspiracyRead the Press Release
Earlier today, in federal court in Central Islip, Mark Lisser pleaded guilty to securities fraud conspiracy for lying to customers about investments in shares of several companies prior to the initial public offering (IPO) of those companies. The proceeding was held before United States Magistrate Judge A. Kathleen Tomlinson.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, announced the guilty plea.
“With today’s guilty plea, the defendant admits to personally profiting from the false representations he made to his customers about the nature of their investments in valuable pre-IPO companies,” stated Acting U.S. Attorney Lesko. “This Office and its law enforcement partners are committed to preventing dishonest advisors like the defendant from taking advantage of the investing public.” Mr. Lesko thanked the Federal Bureau of Investigation, New York Field Office, and the United States Securities and Exchange Commission, New York Regional Office, for their assistance.
Between October 2018 and January 2019, Lisser was a partner in Knightsbridge Private Partners LLC (Knightsbridge), which operated a series of websites and call centers used to solicit investments in purported pre-IPO shares of companies (the Pre-IPO Companies). Employees of Knightsbridge, including Lisser, solicited these investments by falsely telling investors and potential investors that Knightsbridge owned the shares it was selling, that Knightsbridge was on the capitalization table of the pre-IPO Companies, and that Knightsbridge and its employees did not earn any commissions or fees until after the shares were issued to the public and the investors made money. In reality, as Lisser knew, Knightsbridge did not directly own any pre-IPO shares in the Pre-IPO Companies, and was not on the capitalization table of any of the Pre-IPO Companies. Lisser also knew that he and other Knightsbridge employees earned money, including commissions, from the investments at the time they were made. As a result of this scheme, Lisser misappropriated more than $700,000 in investors’ funds to make payments to companies controlled by Knightsbridge employees, pay salaries and sales commissions, pay his personal credit card bill, and make payments on a mortgage.
The government’s case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys Mathew S. Miller and David Gopstein are in charge of the prosecution.
The Defendant:
MARK ALAN LISSER
Age: 40
Massapequa, New YorkE.D.N.Y. Docket No. 21-CR-210 (JMA)