Eastern District of New York
Press releases recorded for this federal judicial district.
Justice Department and Dutch Authorities Announce Simultaneous Enforcement Actions Against International Mass-Mailing Fraud Schemes Targeting the ElderlyRead the Press Release
The United States filed a civil complaint in the U.S. District Court for the Eastern District of New York against an individual and two Dutch companies that allegedly engaged in multiple international mail fraud schemes that have defrauded elderly and vulnerable U.S. victims out of tens of millions of dollars, the Department of Justice announced. The Department sought a temporary restraining order, which was entered by the court yesterday, as well as preliminary and permanent injunctions to prevent the defendants from further victimizing U.S. consumers.
According to the complaint, U.S. residents received fraudulent direct mail solicitations that falsely claimed that the individual recipient had won, or would soon win, cash or valuable prizes or otherwise come into great fortune. Victims sent payments through the U.S. and international mail systems to defendants Trends Service in Kommunikatie, B.V. (Trends), and Kommunikatie Service Buitenland, B.V. (KSB), both in Utrecht, Netherlands, and both owned and operated by defendant Erik Dekker, 54, of Langbroek, Netherlands.
At the same time that the Justice Department took this law enforcement action, Dutch law enforcement agents executed search warrants on the business address used by both companies and on Dekker’s home address. The Dutch authorities also took control of the Dutch P.O. boxes used by the defendants to receive victim funds. The coordinated U.S. and Dutch enforcement actions seek to immediately stop the use of Dutch P.O. boxes to receive payments from fraud victims and to immediately stop the defendants from continuing to victimize the elderly. Learn more about the actions taken by Dutch authorities at: https://www.om.nl/actueel/nieuwsberichten/@94702/fiod-and-us-doj/
“As alleged in the complaint, defendants act as the clearinghouses for multiple international mail fraud schemes, taking money from thousands of elderly and vulnerable victims not only in this district but also throughout the United States,” said U.S. Attorney Robert L. Capers for the Eastern District of New York. “Together with the U.S. Postal Inspection Service and our international partner, the Fiscal Intelligence and Investigation Division of the Netherlands, we will track down, and stop, the schemes wherever they lead.”
“Schemes targeting elderly victims are increasingly international in scope, but geographic distance will not prevent us from seeking justice and holding bad actors accountable,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “Dutch authorities have done a great service to U.S. residents and elderly victims worldwide by addressing fraud facilitated within their borders. The Justice Department will continue to work with our international law enforcement partners to put a stop to fraud schemes that exploit vulnerable Americans.”
“No one should ever be told they must pay a fee, or make a worthless purchase, to collect a prize,” said Inspector in Charge Regina L. Faulkerson. “When that happens, it’s fraud - plain and simple - and Postal Inspectors work to keep those falsehoods out of the U.S. mail.”
The complaint filed June 1 in U.S. federal court in the Eastern District of New York alleges that, since at least 2012, Trends, KSB and Dekker have used P.O. boxes in the Netherlands to receive payments from various predatory mass-mailing fraud schemes. Solicitations are mailed from locations around the globe to residents in the United States. The solicitations purport to be personalized to each individual recipient, even though they are form letters mailed to hundreds of thousands of potential victims. Some solicitations instruct recipients to pay a processing fee in order to receive lottery winnings or other prizes; other solicitations urge recipients to purchase goods or services based on false promises that they will guarantee future lottery wins.
As alleged in the complaint, victims responded to the solicitations by completing a form and submitting a payment, usually around $15 to $55, via U.S. mail. The solicitations contain pre-addressed envelopes in which victims send payments. The envelopes are addressed to P.O. boxes in the Netherlands. Trends and KSB operate more than 50 of these P.O. boxes. Like other so-called “caging services,” Trends and KSB open the payment envelopes, remove the contents, enter payment and other personal information from the victims into a database, and handle victim payments. The U.S. government estimates that U.S. victims mail more than $18 million annually to the defendants’ P.O. boxes.
The government is seeking an injunction under the Anti-Fraud Injunction Statute immediately shutting down the defendants’ role in the fraudulent schemes in order to protect U.S. victims from further harm. The injunctions sought by the United States would enjoin the defendants from using the U.S. mail, or causing the U.S. mail to be used, to distribute the fraudulent solicitations or to collect victim payments, and from selling lists of American victims who have responded to the solicitations. If granted, a permanent injunction would allow the U.S. Postal Service to intercept mail heading to the defendants, and return that mail - along with any money being sent to the defendants - to U.S. victims.
U.S. District Court Judge I. Leo Glasser for the Eastern District of New York set a hearing on the preliminary injunction on July 18 at 10 a.m.
The United States’ case is being handled by Assistant U.S. Attorney John Vagelatos of the U.S. Attorney’s Office in the Eastern District of New York, Trial Attorney Kerala Thie Cowart of the Civil Division’s Consumer Protection Branch, and Postal Inspector Joseph R. Bizzarro of the U.S. Postal Inspection Service.
The claims made in the complaints are allegations only, and there has been no determination of liability.
A copy of the complaint can be found here: The Complaint and exhibits
More information on fraud against the elderly is available here: https://www.justice.gov/elderjustice/.
For more information about the U.S. Attorney’s Office for the Eastern District of New York, visit its website at https://www.justice.gov/usao-edny.
Additional information about the Consumer Protection Branch and its enforcement efforts may be found at http://www.justice.gov/civil/consumer-protection-branch.
E.D.N.Y. Docket No. 16-CV-2770 (ILG)(SMG)
10 Eastern District of New York Employees and 3 Federal Agents Honored by Department of Justice at Executive Office for United States Attorneys Director’s Awards CeremonyRead the Press Release
WASHINGTON – Ten Assistant United States Attorneys from the U.S. Attorney’s Office for the Eastern District of New York and three federal agents were among the 160 members of the Department of Justice recognized by Deputy Attorney General Attorney General Sally Yates, and Executive Office for U.S. Attorneys (EOUSA) Director Monty Wilkinson at the 32nd annual Director’s Awards Ceremony today in Washington D.C.
The Eastern District of New York was one of 33 districts represented at the ceremony which was held in the Great Hall at the Robert F. Kennedy Department of Justice Building.
In her prepared remarks, Deputy Attorney General Yates said, “The achievements being recognized today reflect the breadth of the department’s responsibilities, and some of our most significant challenges. From dismantling dangerous gangs, drug cartels, and human trafficking operations to tackling political corruption, white collar crimes, and international terrorism, these awardees have taken on our toughest cases. And the citizens of our country are safer because of their work.”
“We honor the truly talented and dedicated legal and administrative personnel in the 94 U.S. Attorneys’ Offices and our law enforcement partners who everyday touch lives in our communities, protect the American people, and work to ensure the fair and impartial administration of justice,” said Director Wilkinson.
Executive Assistant United States Attorney Orelia E. Merchant received the award for Superior Performance as an AUSA-Civil for her exemplary performance and leadership in coordinating the handling of over 1,300 cases arising out of Hurricane Sandy, a disaster that affected over 100,000 homeowners in the EDNY in October 2012. Ms. Merchant was instrumental in achieving favorable results for homeowners, while protecting FEMA’s legal, policy, and programmatic interests.
Assistant United States Attorneys Shreve Ariail, Samuel Nitze, and Rena Paul received the award for Superior Performance as an AUSA- Criminal for the prosecution of Ronald Herron. The Gowanus and Wyckoff Gardens neighborhoods in Brooklyn were terrorized for nearly two decades by Herron, a high-ranking member of the “Murderous Mad Dawg” Bloods. During the trial on a 21-count racketeering indictment that included multiple murder charges, Herron and his henchmen threatened witnesses and harassed victim families. Notwithstanding these obstructive efforts, the team obtained convictions on all counts, ridding the district of one of New York’s most dangerous criminals. Herron was sentenced to 12 life terms in prison.
Assistant United States Attorneys Zainab Ahmad and Hilary Jager received the award for Superior Performance as an AUSA - Criminal for the prosecution of al-Qaeda in the Arabian Peninsula (AQAP) operative Lawal Olaniyi Babafemi. Babafemi traveled from Nigeria to Yemen in 2010-2011, where he met with AQAP leaders who trained him in the importance of the English-language media to AQAP and its mission to inspire lone wolf attacks abroad in the name of al-Qaeda. Babafemi was extradited to the United States from Nigeria, pled guilty, and sentenced to 22 years of imprisonment. The case was significant as it related to efforts to prosecute individuals who not only engage in physical violence, but also who create and disseminate violent terrorist propaganda world-wide.
Assistant United States Attorneys James Loonam, Matthew Amatruda, Soumya Dayananda, Rena Paul, Paralegal Specialist Tareva Torres, FBI Special Agent James Glynn, and HSI Special Agents Anthony Salisbury and Mathew Doyle received the award for Superior Performance By A Litigative Team for their performance in the more than ten-year investigation and prosecution of the Cash Money Brothers (CMB), an ultra-violent gang that controlled the Lafayette Gardens housing development in Brooklyn. The investigation culminated in the 2015 trial conviction and life sentence of the leader of CMB, Damion “World” Hardy, and his top enforcer, Aaron Granton, for RICO violations, five murders in-aid-of racketeering, one murder-for-hire, and narcotics trafficking.
EOUSA provides oversight, general executive assistance, and direction to the 94 United States Attorneys’ Offices around the country. For more information on EOUSA and its mission, visit http://www.justice.gov/usao.
New York Pharmacist Pleads Guilty to Medicare and Medicaid Fraud and Tax FraudRead the Press Release
Earlier today, Andrew Barrett, a New York pharmacist and pharmacy owner, pleaded guilty to health care fraud and filing false tax returns. From January 2011 to December 2012, Barrett operated pharmacies in Bronx, Rockland, and Queens counties in New York State. From his Queens pharmacy, Barrett fraudulently billed Medicare and Medicaid approximately $2.7 million for prescription medications that he never dispensed to patients. Barrett also siphoned off over $2.6 million for personal expenses from the Bronx and Rockland pharmacy accounts while falsely claiming those funds as business expenses on his tax returns. When sentenced, Barrett faces up to ten years in prison, as well as restitution, criminal forfeiture, and a fine.
The guilty plea was announced by Robert L. Capers, United States Attorney for the Eastern District of New York; Diego Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); Scott J. Lampert, Special Agent-in-Charge, Department of Health and Human Services, Office of Inspector General, New York Office (HHS-OIG); and Shantelle P. Kitchen, Special Agent-in-Charge, Internal Revenue Service, Criminal Investigation, New York (IRS-CI).
In announcing the guilty plea, Mr. Capers extended his grateful appreciation to the agencies that led the government’s investigation and thanked the New York Office of the Medicaid Inspector General for its cooperation and assistance in the case.
According to the court filings and facts presented at the guilty plea hearing, from his Queens pharmacy, Barrett falsely billed government health care programs approximately $2.7 million for drug products, including a substantial number of HIV-AIDs medications which he never dispensed to patients. Barrett’s scheme involved billing for refills of costly medications even although patients never requested or received them, and doctors had not authorized the refills to be dispensed. Barrett also wrote checks for over $2.6 million to himself to pay for his personal expenses from the Bronx and Rockland pharmacy accounts while falsely claiming those funds as business expenses on his personal and corporate tax returns.
Today’s plea took place before United States Magistrate Judge Viktor V. Pohorelsky.
The government’s case is being prosecuted by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys William P. Campos and Erin E. Argo are in charge of the prosecution. Assistant United States Attorney Karin Orenstein of the Office’s Civil Division is responsible for the forfeiture of assets.
The charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ Offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory, and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state, and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions, and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov.
The Defendant:
ANDREW BARRETT
Age: 57
E.D.N.Y. Docket No. 15-CR-103
Brooklyn Resident Arrested for Conspiring to Launder Multi-Million Dollar Prostitution Service ProceedsRead the Press Release
A criminal complaint was unsealed today in federal court in Brooklyn, New York, charging Michael Rizzi, a retired NYPD Police Officer, with conspiring to launder the proceeds of a multi-million dollar prostitution operation. Rizzi was arrested earlier today, and his initial appearance is scheduled for this afternoon before United States Magistrate Judge Viktor Pohorelsky at the United States Courthouse, 225 Cadman Plaza East, Brooklyn, New York.
The charges were announced by Robert L. Capers, United States Attorney for the Eastern District of New York; Angel M. Melendez, Special Agent-in-Charge, U.S. Immigration and Customs Enforcement, Homeland Security Investigations (HSI), New York; and William J. Bratton, Commissioner, New York City Police Department (NYPD).
As is alleged in the complaint, between June 2012 and May 2016, Rizzi owned and operated BJM/Manhattan Stakes and Entertainment (BJM), a company that provided high-end prostitution services to customers in the New York metropolitan area. Until January 2016, BJM had an office located at 466 Wild Avenue in Staten Island. BJM advertised its services on more than 50 websites, including janeblow.com, nycescortsnyc.com, alluringcompanions.com, lushplaymates.com, plushplaymates.com, lusciouscompanions.com, iconcompanionsnyc.com, pureplaymates.com, perfect10club.com, flygirlsnyc.com, and eliteescortsnyc.com. BJM’s employees included telephone bookers who arranged appointments between prostitutes and BJM’s customers, as well as drivers who collected cash and receipts from BJM’s prostitutes.
The government’s investigation revealed that Rizzi accepted applications for his “escort” business using his email account. One applicant responded, “I am a fun loving girl who loves sex… I love sex and if I can get paid for it why not?”
BJM is a successor to Pure Platinum Models, a company that offered prostitution services. In 2012, the NYPD and HSI opened an investigation into Pure Platinum Models for various criminal offenses, including promotion of prostitution and money laundering. Pure Platinum Models was closed in 2014, and its owner was convicted of laundering more than one million dollars through the company. In 2012, BJM began providing many of the same prostitution services as Pure Platinum Models and used many of the same websites, employees, and prostitutes to conduct its business.
The prostitutes working for BJM charged their customers as much as $2,000 an hour. The investigation into the company’s financial records revealed that several of BJM’s customers each spent more than $100,000 for the company’s services, and that some clients paid more than $25,000 for a single night. Over the course of its operations, BJM collected millions of dollars of payments, including more than $2 million in credit card payments alone between October 2012 and March 2016. A review of various personal and business bank accounts maintained by Rizzi revealed that they were used to promote the prostitution business by laundering almost $200,000 disbursed via Paychex for BJM employee salaries, $25,000 to tollforwarding.com for forwarding phone numbers listed on various of Rizzi’s websites to his phone bookers, $10,000 to GoDaddy.com through which Rizzi registered over 80 websites pertaining to his prostitution business, and $112,000 to Electronic Merchant Services for processing the more than $2 million customer credit card transactions referred to above.
Earlier today, law enforcement executed search warrants at two addresses associated with BJM, as well as a vehicle paid for with business proceeds. The government also took steps to restrain more than 50 domain names registered to Rizzi that were associated with BJM and unsealed a civil complaint seeking the forfeiture of a residence in Florida which Rizzi purchased with the alleged criminal proceeds from his prostitution enterprise.
United States Attorney Capers stated, “The investigation and prosecution of money laundering offenses is a priority program of this Office. With this arrest, we continue to unmask organizations that launder millions of dollars through alleged criminal networks.”
“Rizzi, a former police officer, once entrusted to enforce the law now finds himself accused of breaking it by allegedly laundering money from the proceeds of an on-line prostitution ring,” stated HSI New York Special Agent-in-Charge Melendez. “Working with our local partners at the NYPD, this arrest and HSI’s seizure of dozens of websites signify the end to this high end prostitution ring and money laundering scheme.”
NYPD Commissioner Bratton stated, “The anonymity of the internet stretches only so far. Today, Michael Rizzi’s alleged scheme of prostitution and money laundering is up.”
The charge in the complaint is merely an allegation, and the defendant is presumed innocent unless and until proven guilty. If convicted of money laundering conspiracy, the defendant faces a maximum sentence of 20 years’ imprisonment.
The government’s case is being prosecuted by Assistant United States Attorneys Jennifer S. Carapiet, Erik D. Paulsen, and Claire Kedeshian.
The Defendant:
MICHAEL RIZZI
Age: 44
Brooklyn, New YorkE.D.N.Y. Docket No. 16-MJ-00487
United States Files Civil Complaint Seeking Injunctive Relief, Penalties and Forfeiture of Assets Tied to Suffolk County Clinic’s Illegal Distribution of Prescription PainkillersRead the Press Release
Robert L. Capers, United States Attorney for the Eastern District of New York, and James J. Hunt, Special Agent in Charge, U.S. Drug Enforcement Administration (DEA), New York Division, today announced the filing of a civil complaint seeking injunctive relief and penalties against Roger Kaplan and Choice Medical Services, P.C. (“Choice”), formerly known as Choice Spine Joint & Neurology, a clinic that was located in Rocky Point, New York. The complaint also seeks the forfeiture of 13 pieces of real property located in New York and Florida, approximately $400,000 held in bank accounts, as well as a Bentley and other vehicles. Each of the named assets is linked to Choice’s illegal distribution of highly addictive opioids, such as oxycodone and hydrocodone. The action, filed in federal court in Central Islip, has been assigned to United States District Judge Leonard D. Wexler. United States v. Roger Kaplan, et al., 16-CV-2601.
As alleged, Choice was managed by Kaplan, a chiropractor who, through a family-owned company, owned the Rocky Point premises where the clinic operated and, who, along with family members, received most of the clinic’s millions of dollars in revenue. The complaint focuses on the period from 2006 to the Spring of 2015, during which doctors employed by Choice prescribed highly addictive opioids to patients despite the absence of any legitimate medical need. One Choice doctor lost her medical license following a proceeding before the New York State Department of Health, Office of Professional Medical Conduct. At the proceeding, that doctor, through her attorney, acknowledged that Choice was a “pill mill.” Another Choice doctor, a sleep specialist, pled guilty in federal court in Central Islip to one count of distribution of a controlled substance in violation of the Controlled Substances Act.
The civil complaint describes the enormous number of opioids prescribed at Choice. For example, according to records maintained by the New York State Bureau of Narcotic Enforcement, during a sample 17-month period, the sleep specialist at Choice wrote prescriptions for nearly half a million 30 mg oxycodone tablets alone. On one particular day, the sleep specialist wrote prescriptions for approximately 4,634 dosage units of opioids for the 49 patients he claimed to have seen that day.
In its complaint, the government seeks civil penalties and an injunction against Kaplan and Choice for their roles in issuing prescriptions in violation of federal law. In addition, the government seeks the forfeiture of millions of dollars in ill-gotten gains amassed by Choice and disbursed to Kaplan and his family members, who used the funds to, among other things, pay for a number of residences located in Manhattan and in Shoreham, New York, as well as in Florida. The government also seeks to forfeit the clinic and accounts containing the clinic’s illegal proceeds, and vehicles purchased by Kaplan and members of his family with the proceeds, including the Bentley, which Kaplan purchased for more than $163,000.
“We are all too familiar with the devastating harm caused to individuals, and our community as a whole, by the abuse of prescription painkillers. Today’s filing serves as a warning to those who prey on, and profit from, people who have developed addictions to opioids,” stated United States Attorney Capers. “We thank our partners in this coordinated investigation and prosecution to combat the unlawful distribution of opioids.”
DEA Special Agent in Charge Hunt stated, “Roger Kaplan’s alleged offenses are an example of how an unscrupulous medical professional can take advantage of vulnerable patients and reap millions of dollars through the illegal prescription of opioids. During the course of an eighteen-month investigation, law enforcement learned that doctors employed by Choice Medical Services, P.C., a now defunct Long Island pill mill which Kaplan controlled, prescribed thousands of pain pills a day to numerous patients in disregard of the patients’ medical conditions and needs. I commend the men and women who worked on this investigation. Identifying and dealing with prescription drug diversion and abuse, and depriving those who engage in such conduct of their ill-gotten gains, is critical to the mission of the DEA.”
Opioid abuse has reached epidemic proportions throughout the United States. According to the United States Department of Health & Human Services Centers for Disease Control and Prevention (“CDC”), on average 78 Americans died every day from an opioid overdose in 2014. In response to the overwhelming number of prescriptions, and the mounting number of overdoses and deaths, two months ago the CDC issued new guidelines recommending that doctors prescribe less addictive and less powerful pain relievers before prescribing highly addictive drugs, and that they prescribe limited amounts.
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,[1] in conjunction with the five District Attorneys in this district, the Nassau and Suffolk County Police Departments, the New York City Police Department, and New York State Police, along with other key federal, state and local government partners, launched the Initiative to mount a comprehensive response to the increase in opioid abuse. To date, the Initiative has brought over 160 federal and local criminal prosecutions, including the prosecution of 22 health care professionals. The Initiative also has resulted in civil enforcement actions against a hospital, a pharmacy and a pharmacy chain, the removal of prescription authority from numerous rogue doctors, and the expansion of information-sharing among enforcement agencies to better target and pursue drug traffickers.
The United States’ case is being prosecuted by Assistant United States Attorneys Madeline O’Connor, Laura D. Mantell and Elliot M. Schachner, with assistance from Paralegal Specialist Brian S. Gappa.
E.D.N.Y. Docket No. 16-CV-2601
[1] The investigation was led by DEA’s Long Island Tactical Diversion Squad comprising agents and officers of the DEA, Nassau County Police Department, Rockville Centre Police Department, Port Washington Police Department and Suffolk County Police Department. In addition, the investigation was assisted by HHS/OIG and the FBI. The Nassau County Police Department Asset Forfeiture Unit also provided invaluable assistance.
Architect of Offshore Fraud Haven Pleads Guilty to $250 Million Money Laundering SchemeRead the Press Release
BROOKLYN, NY – Earlier today, Robert Bandfield, a U.S. citizen and resident of Belize, pleaded guilty to money laundering conspiracy for facilitating the stock manipulation of more than 40 U.S. publicly-traded companies and then laundering more than $250 million in profits through unidentifiable debit cards and attorney escrow accounts. Pursuant to his plea agreement with the government, Bandfield has agreed to forfeit, among other things, $1 million and all his rights and interests in three corporate entities -- IPC Management Services LLC, IPC Corporate Services Inc., and IPC Corporate Services LLC (collectively, IPC Corp.) -- that he founded and controlled in Belize. When sentenced, Bandfield faces up to 20 years in prison.
The guilty plea was announced by Robert L. Capers, United States Attorney for the Eastern District of New York; Diego Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); Shantelle P. Kitchen, Special Agent-in-Charge, Internal Revenue Service, Criminal Investigation, New York (IRS-CI); and Angel M. Melendez, Special Agent-in-Charge, U.S. Immigration and Customs Enforcement’s (ICE), Homeland Security Investigations, New York (HSI).
In announcing the guilty plea, Mr. Capers extended his grateful appreciation to the agencies that led the government’s investigation and thanked the Securities and Exchange Commission (SEC), the Department of Justice’s Office of International Affairs (OIA), the Department of State’s Diplomatic Security Service (DSS), and the Financial Industry Regulatory Authority, Inc., Criminal Prosecution Assistance Group (FINRA CPAG) for their cooperation and assistance in the case
According to the court filings and facts presented at the plea hearing, between January 2009 and September 2014, Bandfield and his co-conspirators engaged in three interrelated schemes: (1) to induce U.S. investors to purchase stock in various thinly-traded U.S. public companies through fraudulent promotion of the stock, concealment of their ownership interests in the companies, and fraudulent manipulation of artificial price movements and trading volume in the stocks of those companies; (2) to circumvent the payment of capital gains taxes and the IRS’s reporting requirements under the Foreign Account Tax Compliance Act (FATCA); and (3) to launder the fraudulent proceeds from the stock manipulation schemes to and from the United States through debit cards and attorney escrow accounts. Through these schemes, Bandfield helped his corrupt clients -- who included more than 100 U.S. citizens and residents -- launder more than $250 million in fraudulent proceeds.
To facilitate these interrelated schemes, Bandfield and his co-conspirators created shell companies in Belize and the West Indies for the corrupt clients and placed nominees at the helm of these companies. This structure was designed to conceal the clients’ ownership interest in the stock of U.S. public companies, in violation of U.S. securities laws, and enable the corrupt investors to engage in trading under the nominee’s names through brokerage firms also set up in Belize. For example, this structure enabled Bandfield’s clients to manipulate the stock of Cynk Technology Corp, which traded on the U.S. OTC markets under the ticker symbol CYNK. Bandfield’s clients concealed their ownership of “all the free trading” or unrestricted shares of CYNK through shell companies incorporated by IPC Corp. Prior to May 15, 2014, there had been no trading in CYNK stock for 24 trading days. Over the next two months, the stock of CYNK rose from $0.06 per share to $13.90 per share, a more than $4 billion stock market valuation for a company that had no revenue and no assets.
Bandfield’s scheme also enabled the U.S. corrupt clients evade reporting requirements to the IRS by concealing the proceeds generated by the manipulated stock transactions through the shell companies and their nominees. For example, in response to a request received by a U.S. corrupt client from a U.S. transfer agent who had to determine whether the proceeds from manipulative stock trading transaction were taxable under U.S. law, Bandfield forwarded an IRS Form signed by co-defendant Andrew Godfrey as the nominee for the shell company which had been set up at the request of the client. At one point during the government’s investigation, Bandfield boasted to an undercover law enforcement agent that he had specifically designed this “slick” corporate structure to counter President Barack Obama’s new laws, a reference to FATCA.
An example of how the defendants’ scheme enabled U.S. corrupt clients to launder the proceeds from their fraudulent trading in U.S. public companies was the production of unidentifiable debit cards for the clients allowing them to freely transfer their proceeds back into the United States.
Today’s guilty plea took place before United States District Judge I. Leo Glasser.
The government’s case is being prosecuted by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys Jacquelyn Kasulis, Winston Paes, and Michael Keilty are in charge of the prosecution. Assistant United States Attorney Brian Morris of the Office’s Civil Division is responsible for the forfeiture of assets.
The charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory, and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state, and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions, and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov.
The Defendant:
ROBERT BANDFIELD
Age: 71
Belize City, BelizeEDNY Docket No. 14-CR-476 (ILG)
Operator of Alleged Cybercrime Marketplace Extradited to the United States to Face ChargesRead the Press Release
On Friday, May 20, 2016, a complaint was unsealed in Brooklyn federal court charging Djevair Ametovski, a Macedonian citizen also known as “codeshop,” “sindrom,” and “sindromx,” with crimes related to his operation of the website Codeshop.su, a website allegedly created for the sole purpose of selling illegally obtained credit and debit card data and personal identification information for financial gain. The charges include aggravated identity theft, access device fraud conspiracy, and wire fraud conspiracy. The defendant is scheduled to be arraigned at 11 a.m. tomorrow, May 21, 2016, before United States Magistrate Judge Roanne L. Mann at the U.S. Courthouse, 225 Cadman Plaza East, Brooklyn, New York.
The charges were announced by Robert L. Capers, United States Attorney for the Eastern District of New York, and David E. Beach, Special Agent in Charge, United States Secret Service, New York Field Office.
“Cybercriminals who create and operate online criminal marketplaces in which innocent victims’ financial and personal information are bought and sold erode consumer trust in modern-day payment systems and cause millions of dollars in losses to financial institutions and unsuspecting individuals. Today marks a major step in bringing the alleged operator of one such criminal marketplace to justice, and should serve as a warning to others who seek to profit from perpetuating these fraudulent schemes,” stated United States Attorney Capers. Mr. Capers cited the extraordinary efforts of the Secret Service, the agency responsible for leading the government’s investigation, and also thanked the Slovenian Ministry of the Interior and Ministry of Justice, for their assistance in the investigation and effecting the defendant’s extradition, the United States Marshals Service, for their assistance in transporting the defendant to the United States, and the U.S. Department of State Regional Security Officers in Slovenia and the Netherlands, for their assistance in facilitating the defendant’s extradition.
“Today’s extradition of alleged cybercriminal Djevair Ametovski from Central Europe is the culmination of a seven-year investigation and demonstrates the relentless pursuit by the Secret Service and its international partners to bring cybercriminals to justice. Multinational cyber investigations require establishing critical partnerships with our international law enforcement partners. The immeasurable assistance provided to our New York Electronic Crimes Task Force by the Slovenian Authorities in this case illustrates that our investigative reach will continue to expand beyond the borders of the United States,” said Special Agent in Charge Beach of the United States Secret Service New York Field Office.
As detailed in the complaint, Ametovski obtained valuable data from hackers, who stole it from financial institutions and other businesses or from individuals using “phishing” tactics.[1] Ametovski then sold the data on his website, a fully indexed and searchable website that allowed users to search through databases of stolen data by bank identification number, financial institution, country, state, and card brand to find the precise data that they wished to buy. Individuals who bought data from the website generally used it to make online purchases and to encode plastic cards with the data and use the cards to withdraw cash at ATMs. Ametovski used a network of online money exchangers and digital currencies to pay the hackers who fed him data and to receive payments from the website users who bought data in order to conceal all participants’ identities, including his own. Over the course of the scheme, Ametovski obtained and sold credit and debit card data for more than 181,000 different cards. In many instances, the data included personal details associated with the account holder, including email address, billing address, phone number, and account holder name. The charged scheme resulted in millions of dollars in financial losses to thousands of victims around the world.
Ametovski was arrested in Ljubljana, Slovenia, on January 22, 2014, and was extradited to the United States today.
The charges in the complaint are allegations, and the defendant is presumed innocent unless and until proven guilty.
The government’s case is being handled by the Office’s National Security & Cybercrime Section. Assistant United States Attorneys Una Dean, Saritha Komatireddy, and Hilary Jager are in charge of the prosecution. Substantial assistance was provided by Marcus Busch of the Justice Department’s Office of International Affairs.
The Defendant:
DJEVAIR AMETOVSKI
Alias: Codeshop, Sindrom, Sindromx
Age: 29
Nationality: Macedonian E.D.N.Y. Docket No. 14 M 058
[1] “Phishing” is a common cyber fraud tactic that involves sending an email to a user falsely claiming to be an established legitimate enterprise in an attempt to scam the user into surrendering private information. In this case, such emails commonly directed users to visit a bogus website where they were asked to update personal information, such as passwords and credit card, social security, and bank account number previously provided to a legitimate organization.
Uzbeki National Charged with Conspiring and Attempting to Provide Material Support to ISILRead the Press Release
Defendant Allegedly Contributed Funds to Send a Co-Conspirator Overseas to Join ISIL and to Finance the Purchase of a Firearm Once the Co-Conspirator Arrived in Syria
A superseding indictment was unsealed in the Eastern District of New York charging Azizjon Rakhmatov, 28, an Uzbeki national, with conspiring and attempting to provide material support to the Islamic State of Iraq and the Levant (ISIL), a designated foreign terrorist organization, and conspiring to use a firearm.
The charges were announced by Assistant Attorney General for National Security John P. Carlin, U.S. Attorney Robert L. Capers of the Eastern District of New York, Assistant Director in Charge Diego G. Rodriguez of the FBI’s New York Field Office, Commissioner William J. Bratton of the New York City Police Department (NYPD) and Special Agent in Charge Angel M. Melendez of U.S. Immigration and Customs Enforcement-Homeland Security Investigations (HSI) New York.
Rakhmatov, who is charged with four others whose arrests and indictments have previously been announced, is scheduled to be arraigned at 2:00 p.m. today before U.S. Magistrate Judge James Orenstein of the Eastern District of New York at the U.S. Courthouse, 225 Cadman Plaza East, Brooklyn, New York.
As alleged in the third superseding indictment and other court filings, the investigation began when Abdurasul Juraboev, one of Rakhmatov’s co-conspirators, came to the attention of law enforcement. On an Uzbek-language website that propagates ISIL’s ideology, Juraboev posted an offer to engage in an act of martyrdom on U.S. soil on behalf of ISIL, such as killing the President of the United States. The investigation subsequently revealed that Juraboev and another co-defendant, Akhror Saidakhmetov, planned to travel to Turkey and then to Syria for the purpose of waging violent jihad on behalf of ISIL. Saidakhmetov was arrested on Feb. 25, 2015, at John F. Kennedy International Airport, where he was attempting to board a flight to Istanbul. Juraboev previously purchased a plane ticket to travel from New York to Istanbul and was scheduled to leave the United States in March 2015. Rakhmatov and three other co-defendants – Abror Habibov, Dilkhayot Kasimov and Akmal Zakirov – are charged with funding Saidakhmetov’s efforts to join ISIL. Juraboev pleaded guilty on Aug. 14, 2015, to conspiring to provide material support to ISIL.
As alleged in the third superseding indictment and other court filings, Rakhmatov helped to fund Saidakhmetov’s efforts to join ISIL. Specifically, Rakhmatov and Habibov discussed providing their own money to cover Saidakhmetov’s travel expenses and to purchase a firearm for Saidakhmetov once he arrived in Syria. Rakhmatov also agreed to raise money from others to fund Saidakhmetov’s travel. In the week leading up to Saidakhmetov’s scheduled departure, Rakhmatov transferred money into Zakirov’s personal bank account, which was intended to facilitate Saidakhmetov’s travel to join ISIL.
If convicted, Rakhmatov faces a maximum sentence of 50 years in prison. The charges in the superseding indictment are allegations, and the defendant is presumed innocent unless and until proven guilty.
Assistant Attorney General Carlin joined U.S. Attorney Capers in extending his grateful appreciation to the FBI’s Joint Terrorism Task Force, the FBI New Haven Division and the U.S. Attorney’s Office of the District of Connecticut.
The case is being prosecuted by Assistant U.S. Attorneys Alexander A. Solomon, Douglas M. Pravda and Peter W. Baldwin of the Eastern District of New York, with assistance provided by Assistant U.S. Attorney Stephen Reynolds of the District of Connecticut and Trial Attorney Danya Atiyeh of the National Security Division’s Counterterrorism Section.
Rakhmatov Indictment
Defendant Charged with Conspiring and Attempting to Provide Material Support to ISILRead the Press Release
Earlier today, a superseding indictment was unsealed in federal court in the Eastern District of New York charging Azizjon Rakhmatov with conspiring and attempting to provide material support to the Islamic State of Iraq and the Levant (ISIL), a designated foreign terrorist organization, and conspiring to use a firearm. The defendant, who is charged with four others whose arrests and indictments have previously been announced, is scheduled to be arraigned at 2:00 p.m. today before United States Magistrate Judge James Orenstein at the U.S. Courthouse, 225 Cadman Plaza East, Brooklyn, New York.
The charges were announced by Robert L. Capers, United States Attorney for the Eastern District of New York; John P. Carlin, Assistant Attorney General for National Security; Diego G. Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation (FBI), New York Field Office; William J. Bratton, Commissioner, New York City Police Department (NYPD); and Angel M. Melendez, Special Agent-in-Charge, Homeland Security Investigations (HSI), New York.
As alleged in the third superseding indictment and other court filings, the investigation began when Abdurasul Juraboev, one of Rakhmatov’s co-conspirators, came to the attention of law enforcement. Juraboev posted on an Uzbek-language website that propagates ISIL’s ideology his offer to engage in an act of martyrdom on U.S. soil on behalf of ISIL, such as killing the President of the United States. The investigation subsequently revealed that Juraboev and another co-defendant, Akhror Saidakhmetov, planned to travel to Turkey and then to Syria for the purpose of waging violent jihad on behalf of ISIL. Saidakhmetov was arrested on February 25, 2015, at John F. Kennedy International Airport where he was attempting to board a flight to Istanbul, Turkey. Juraboev previously purchased a plane ticket to travel from New York to Istanbul and was scheduled to leave the United States in March 2015. Rakhmatov and three other co-defendants – Abror Habibov, Dilkhayot Kasimov, and Akmal Zakirov – are charged with funding Saidakhmetov’s efforts to join ISIL. Juraboev pleaded guilty on August 14, 2015, to conspiring to provide material support to ISIL.
As alleged in the third superseding indictment and other court filings, Rakhmatov helped to fund Saidakhmetov’s efforts to join ISIL. Specifically, Rakhmatov and Habibov discussed providing their own money to cover Saidakhmetov’s travel expenses and to purchase a firearm for Saidakhmetov once he arrived in Syria. Rakhmatov also agreed to raise money from others to fund Saidakhmetov’s travel. In the week leading up to Saidakhmetov’s scheduled departure, Rakhmatov transferred money into Zakirov’s personal bank account, which funds were intended to facilitate Saidakhmetov’s travel to join ISIL.
If convicted, Rakhmatov faces a maximum sentence of 50 years in prison. The charges in the superseding 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 National Security & Cybercrime Section. Assistant United States Attorneys Alexander A. Solomon, Douglas M. Pravda, and Peter W. Baldwin are in charge of the prosecution, with assistance provided by Assistant United States Attorney Stephen Reynolds of the United States Attorney’s Office for the District of Connecticut and Trial Attorney Danya Atiyeh of the National Security Division’s Counterterrorism Section.
The Defendant:
AZIZJON RAKHMATOV
Age: 28
Nationality: UzbekiE.D.N.Y. Docket No. 15-CR-95 (S-3)
Orchestrator of More Than 40 Pump and Dump Schemes and Secret Owner of Offshore Brokerage Firm Pleads Guilty To$250 Million Money Laundering SchemeRead the Press Release
BROOKLYN, N.Y. – Earlier today, Gregg R. Mulholland, a dual U.S. and Canadian citizen and secret owner of Legacy Global Markets S.A. (Legacy), an offshore broker-dealer and investment management company based in Panama City, Panama, and Belize City, Belize, pleaded guilty to money laundering conspiracy for fraudulently manipulating the stocks of more than 40 U.S. publicly-traded companies and then laundering more than $250 million in profits through at least five offshore law firms. Pursuant to his plea agreement with the government, Mulholland has agreed to forfeit, among other things, a Dassault-Breguet Falcon 50 aircraft, a Range Rover Defender vehicle, two real estate properties in British Columbia, and funds and securities on deposit at more than a dozen bank and brokerage accounts. When sentenced, Mulholland faces up to 20 years in prison.
The guilty plea was announced by Robert L. Capers, United States Attorney for the Eastern District of New York; Diego Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); Shantelle P. Kitchen, Special Agent-in-Charge, Internal Revenue Service, Criminal Investigation, New York (IRS-CI); and Angel M. Melendez, Special Agent-in-Charge, U.S. Immigration and Customs Enforcement’s (ICE), Homeland Security Investigations, New York (HSI).
“Mulholland’s staggering fraud perpetrated on the investing public was built on an elaborate offshore shell game, which included his secret ownership of an offshore brokerage firm. Through manipulative trading, Mulholland generated profits of more than $250 million and used a corrupt lawyer to launder the proceeds into the United States to pay his fraudulent network of stock promoters and broker-dealers,” stated United States Attorney Capers. “We are steadfast in our commitment to protect the investing public and will vigorously prosecute those who seek to abuse the financial markets through fraudulent means.” Mr. Capers thanked the Securities and Exchange Commission (SEC), the Department of Justice’s Office of International Affairs (OIA), the Department of State’s Diplomatic Security Service (DSS), and the Financial Industry Regulatory Authority, Inc., Criminal Prosecution Assistance Group (FINRA CPAG) for their cooperation and assistance in the investigation.
“Mulholland pleaded guilty today for his role in a stock manipulation and profit hiding scheme totaling more than $250 million. Making sure our markets are fair to all investors and bringing charges against those who profit illegally remains a top priority for the FBI,” stated FBI Assistant Director-in-Charge Rodriguez.
“This investigation highlights the government’s ability and resolve to combat global money laundering, in this case, the laundering of illicit proceeds from a stock manipulation scheme,” stated IRS-CI Special Agent-in-Charge Kitchen. “Prospective money launderers should take note of Mr. Mulholland’s conviction and think twice about the consequences of such actions. The same holds true for individuals who attempt to criminally circumvent IRS reporting requirements regarding foreign accounts, as their actions will attract the attention of IRS-Criminal Investigation.”
“Laundering more than a quarter of a billion dollars, this defendant used multiple schemes including manipulating the stocks of more than 40 companies in order to line his pockets at the expense of the U.S. financial system. HSI remains committed to using its unique authorities to arrest those that seek to conceal and launder illicit proceeds, causing harm to our economy,” said Special Agent-in-Charge Melendez.
Between 2010 and 2014, Mulholland controlled a group of individuals (the Mulholland Group) who together devised three interrelated schemes to: (1) induce U.S. investors to purchase stock in various thinly-traded U.S. public companies through fraudulent promotion of the stock, concealment of their ownership interests in the companies, and fraudulent manipulation of artificial price movements and trading volume in the stocks of those companies; (2) circumvent the IRS’s reporting requirements under the Foreign Account Tax Compliance Act (FATCA); and (3) launder the fraudulent proceeds from the stock manipulation schemes to and from the United States through five offshore law firms. Through these schemes, the Mulholland Group laundered more than $250 million in fraudulent proceeds.
To facilitate the interrelated schemes, the Mulholland Group used shell companies in Belize and Nevis, West Indies, which had nominees at the helm. This structure was designed to conceal the Mulholland Group’s ownership interest in the stock of U.S. public companies, in violation of U.S. securities laws, and enabled the Mulholland Group to engage in more than 40 “pump and dump” schemes. For example, this structure enabled the Mulholland Group to manipulate the stock of Cynk Technology Corp, which traded on the U.S. OTC markets under the ticker symbol CYNK. Using aliases such as “Stamps” and “Charlie Wolf,” Mulholland was intercepted on a court-authorized wiretap on May 15, 2014, admitting to his ownership of “all the free trading” or unrestricted shares of CYNK. Prior to this conversation between Mulholland and his trader at Legacy, there had been no trading in CYNK stock for 24 trading days. Over the next two months, the stock of CYNK rose from $0.06 per share to $13.90 per share, a more than $4 billion stock market valuation for a company that had no revenue and no assets.
Mulholland used the services of a U.S.-based lawyer to launder the more than $250 million generated through his stock manipulation of CYNK and other U.S. companies – directing the fraud proceeds to five law firm accounts and transmitting them back to members of the Mulholland Group and its co-conspirators. These concealment schemes also enabled Mulholland to evade reporting requirements to the IRS.
Today’s guilty plea took place before United States District Judge I. Leo Glasser.
The government’s case is being prosecuted by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys Jacquelyn Kasulis, Winston Paes, and Michael Keilty are in charge of the prosecution. Assistant United States Attorney Brian Morris of the Office’s Civil Division will be responsible for the forfeiture of assets.
The charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory, and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state, and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions, and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov.
The Defendant:
GREGG R. MULHOLLAND
Age: 46
San Juan Capistrano, California
Vancouver, CanadaEDNY Docket No. 14-CR-476 (ILG)
Justice Department Permanently Shuts Down International “Psychic” Mail Fraud SchemeRead the Press Release
The U.S. District Court for the Eastern District of New York entered a consent decree today that permanently barred eight individuals and entities from operating an alleged international multi-million dollar mail-fraud scheme in the name of alleged psychics Maria Duval and Patrick Guerin. Pursuant to the consent decree, the defendants were barred from using the U.S. mail to distribute any advertisements, solicitations, or promotional materials on behalf of any psychics, clairvoyants, or astrologers. The consent decree also enjoined the defendants from using the U.S. mail to distribute materials representing that services or items offered for purchase will increase the recipient’s odds of winning a lottery, will bring the recipient good luck, or will entitle the recipient to receive an inheritance. The consent decree also authorized the United State Postal Inspection Service to return any money or personal checks sent to the defendants and detained by the Postal Inspection Service.
The following eight international defendants agreed to be bound by a permanent injunction in order to resolve the United States’ civil suit against them: Canadian company 9097-9394 Québec Inc. dba Infogest Direct Marketing (Infogest); Infogest employees Mary Thanos, Daniel Sousse and Philip Lett, all of Quebec, Canada; Hong Kong corporation Destiny Research Center Ltd.; Destiny Research Center President Martin Dettling of Zurich, Switzerland; Patrick Guerin of France; and Maria Duval of France.
In an amended complaint filed in November 2015, the United States alleges that the defendants operated a mail fraud scheme in which they sent letters purporting to be written by psychics Maria Duval and Patrick Guerin to American consumers through the U.S. mail. The letters claim that the psychics have had a specific, personalized vision or psychic reading revealing that the recipient of the letter has the opportunity to achieve great wealth, including claims of winning millions in the lottery. The solicitations urge victims to purchase various products and services in order to ensure that the foreseen good fortune comes to pass. In reality, the solicitations are identical, mass produced form letters sent to tens of thousands of recipients throughout the United States every month. Many of the customers who receive the solicitations are vulnerable victims, including the desperate, elderly, and infirm.
The United States alleges that the fraud scheme victimized more than one million Americans, who sent the defendants payments totaling more than $180 million.
“To line their own pockets, the defendants preyed upon the superstition and desperation of millions of vulnerable Americans,” said United States Attorney Robert L. Capers. “We will use every means at our disposal to protect our citizens from fraudulent schemes like this that target the lonely, the ill, and the elderly.”
“This widespread scam targeted more than one million Americans, many of whom were elderly or in financial distress,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “The Justice Department is committed to stopping such fraud and pursuing all those responsible for lying to vulnerable consumers for their own financial gain.”
The defendants have all agreed to settle the case and be bound by a permanent injunction. The permanent injunction also bars the defendants from making various claims in advertisements sent through the U.S. mail, including claims that products offered for sale will increase the recipient’s odds of winning the lottery or bring the recipient luck or good fortune. The permanent injunction further bars the defendants from using or selling lists of consumers who have responded to the Duval and Guerin solicitations.
The United States’ case is being handled by John Vagelatos, Chief of Affirmative Civil Enforcement for the U.S. Attorney’s Office of the Eastern District of New York, and Ann F. Entwistle, Trial Attorney for the Civil Division’s Consumer Protection Branch, in coordination with the U.S. Postal Inspection Service.
For more information about the U.S. Attorney’s Office for the Eastern District of New York, visit its website at https://www.justice.gov/usao-edny. Additional information about the Consumer Protection Branch and its enforcement efforts may be found at http://www.justice.gov/civil/consumer-protection-branch.
E.D.N.Y. Docket No. 14-CV-6791
Former Federal Correctional Officer Sentenced to Seven Years for Sexually Abusing an InmateRead the Press Release
Earlier today at the federal courthouse in Brooklyn, New York, Rudell L. Clark Mullings, a former federal correctional officer at the Metropolitan Correctional Center (MCC) in Manhattan, was sentenced to seven years’ imprisonment by United States District Judge Edward R. Korman.
On February 14, 2015, Mullings was working as a correctional officer at the MCC. On that day, he was tasked with overseeing a female inmate, who was cleaning the hallways and corridors of the MCC. Mullings approached the inmate and sexually assaulted her in the corridor. Thereafter, Mullings returned to the hallway to ensure no security cameras had caught the assault. A DNA test later confirmed that Mullings had engaged in sex with the victim.
Mullings pled guilty to sexual abuse of an inmate on November 23, 2015.
The sentence was announced by Robert L. Capers, United States Attorney for the Eastern District of New York, and Ronald G. Gardella, Special Agent in Charge, United States Department of Justice, Office of the Inspector General, New York Field Office.
In announcing the sentencing, Mr. Capers extended his grateful appreciation to the Office of the Inspector General.
The government’s case is being prosecuted by Assistant United States Attorney Hiral D. Mehta.
The Defendant:
RUDELL L. CLARK MULLINGS
Age: 54
Brooklyn, New YorkE.D.N.Y. Docket No. 15-CR-538 (ERK)
Nine Individuals, Including Five Registered Brokers, Indicted for Orchestrating A $131 Million Market Manipulation SchemeRead the Press Release
BROOKLYN, N.Y. – A five-count indictment was unsealed this morning in federal court in Brooklyn, New York, against nine defendants, Jared Mitchell, the Managing Partner of Mitchell & Sullivan Capital LLC; Richard Brown, a registered broker; Christopher Castaldo, the Chief Executive Officer of Stock Traders Press Inc. and the President of Wall Street Buy Sell Hold Inc.; Gerald Cocuzzo, also known as “Gerry,” a registered broker; Naveed Khan, also known as “Nick,” a registered broker; Herschel Knippa III, also known as “Tres,” the owner and Head Trader at Kenai Capital Management LLC; Maroof Miyana, a registered broker; Pranav Patel, a registered broker; and Louis Petrossi, the founder and Chief Executive Officer of the Wealth Research Institute.[1] The charges include securities fraud, conspiracy to commit securities fraud, wire fraud, money laundering and making a false statement to law enforcement officials in connection with the fraudulent market manipulation of ForceField Energy Inc. (ForceField), a publicly-traded company listed on the NASDAQ under the ticker symbol “FNRG.”
Mitchell, Brown, Castaldo and Khan will be arraigned later today before Magistrate Judge Vera M. Scanlon, at the United States Courthouse, 225 Cadman Plaza East, Brooklyn, New York. Cocuzzo and Miyana’s initial appearance for removal proceedings to the Eastern District of New York is scheduled for this afternoon at the United States Courthouse, 701 Clematis Street, West Palm Beach, Florida. Patel’s initial appearance for removal proceedings to the Eastern District of New York is scheduled for this afternoon at the United States Courthouse, 299 East Broward Boulevard, Fort Lauderdale, Florida. Knippa’s initial appearance for removal proceedings to the Eastern District of New York is scheduled for this afternoon at the United States Courthouse, 1100 Commerce Street, Dallas, Texas. Petrossi’s initial appearance for removal proceedings to the Eastern District of New York is scheduled for this afternoon at the United States Courthouse, 400 South Virginia Street, Reno, Nevada.
The indictment was announced by Robert L. Capers, United States Attorney for the Eastern District of New York, and Diego Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI).
“As alleged, the defendants and their network of registered brokers and stock promoters designed an elaborate but fraudulent scheme built on lies, kickbacks and manipulated trading activity to defraud the securities markets, the investing public and their clients. They took a company with essentially no business operations and little revenue and deceived the market and their clients into believing it was worth hundreds of millions of dollars through a dizzying round of unauthorized trades and deceptive promotions. In the end, the deceived investors were left holding the empty bag,” stated United States Attorney Capers. “Today’s nine arrests, across four states, reflect the scope of this fraud and our commitment to aggressively locate and bring to justice those who view the financial markets as a platform to fraudulently enrich themselves.” Mr. Capers expressed his appreciation to the FBI, the agency that led the investigation, and the United States Securities and Exchange Commission, New York Regional Office, for their significant cooperation and assistance in the investigation.
“As alleged, each of the defendants played a role in their scheme to defraud investors of ForceField Energy by using their positions as a stock promoter, brokers, or investor relations to push stock. The scheme ended up costing investors approximately $131 million in losses. The FBI will continue to work with our partners in an effort at ensuring that our financial markets are legal, fair, and equitable,” stated FBI Assistant Director-in-Charge Rodriguez.
As alleged in the indictment and other court filings, between December 2009 and April 2015, the defendants, together with others, engaged in a scheme to defraud investors in ForceField, a purported worldwide distributor and provider of LED lighting products and solutions, by artificially controlling the price and volume of traded shares of ForceField through, among other means: (1) using nominees to purchase and sell ForceField stock without disclosing this information to investors and potential investors; (2) orchestrating the trading of ForceField stock to create the appearance of genuine trading volume and interest in the stock; and (3) concealing payments to stock promoters and broker dealers who promoted and sold ForceField stock to investors and potential investors while claiming to be independent of the company. The defendants’ fraudulent scheme caused a loss of approximately $131 million to the investing public.
The Corrupt Brokers
In October 2014, a ForceField executive hired Mitchell to distribute kickbacks to a network of allegedly corrupt registered broker dealers, including Brown, Cocuzzo, Khan, Miyana, and Patel, in exchange for purchasing ForceField stock in their clients’ brokerage accounts. Using offshore entities and bank accounts, ForceField paid Mitchell a ten-percent commission, or kickback, for purchases of ForceField stock generated by the corrupt brokers. Mitchell then shared the ten-percent commission with those who had stuffed their clients’ brokerage accounts with ForceField stock. Mitchell, the corrupt brokers and ForceField did not disclose to the brokers’ clients the ten-percent kickbacks the brokers were receiving for purchasing ForceField stock.
Mitchell and the corrupt brokers concealed their participation in the fraudulent scheme by using prepaid, disposable cellular telephones and encrypted, content-expiring messaging applications to communicate with each other. Mitchell, who boasted that he was the “brown bag man,” also attempted to conceal his payment of commissions to the corrupt brokers by withdrawing large sums of money from his bank account and paying the brokers in cash.
Between October 2014 and April 2015 alone, Mitchell and the corrupt brokers conned the brokers’ clients into purchasing more than 425,000 shares of ForceField at a cost of more than $3 million.
The Corrupt Promoters
Throughout its existence, ForceField conducted a series of private placements that raised more than $19.7 million from investors. Unbeknownst to the investing public, a ForceField executive was paying ten-percent kickbacks to a group of allegedly corrupt stock promoters, including Castaldo, Knippa, and Petrossi, to promote ForceField and induce investors to purchase ForceField stock on public exchanges or enter into private stock purchase agreements with the company. The corrupt promoters induced many of these unwitting investors to invest in ForceField at investor conferences or, in Knippa’s case, by touting ForceField during television appearances.
For example, when Knippa appeared on “Varney & Co.,” a financial news show on the Fox Business channel, the host of the show asked Knippa whether he had a stock recommendation. In response, Knippa recommended ForceField, and spoke about the company’s business model. Varney asked Knippa whether he owned ForceField stock, and Knippa responded, “You bet I do. I put my money where my mouth is.” Contrary to his assertion, Knippa did not, at the time, own ForceField stock. Additionally, during this appearance, Knippa failed to disclose that he was being paid kickbacks to promote ForceField.
During the course of this fraudulent scheme, the corrupt promoters duped more than 100 investors into purchasing more than $6.2 million in ForceField stock.
* * *
The wire fraud conspiracy with which all defendants are charged carries a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gain or loss from the offense. The securities fraud conspiracy count with which all defendants are charged carries a maximum potential penalty of five years in prison and a $250,000 fine, or twice the gain or loss from the offense. The money laundering conspiracy count with which all defendants are charged carries a maximum potential penalty of 20 years in prison and a $500,000 fine, or twice the value of the funds involved in the illegal transfers. The substantive securities fraud count with which all defendants are charged carries a maximum potential penalty of 20 years in prison and a $5 million fine, or twice the gain or loss from the offense. The false statement count with which Mitchell is charged carries a maximum potential penalty of 5 years in prison and a $250,000 fine.
The government’s case is being prosecuted by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys Jacquelyn Kasulis and Christopher Nasson are in charge of the prosecution.
* * *
The charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory, and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state, and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions, and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit ww.StopFraud.gov.
The Defendants:
JARED MITCHELL
Age: 34
New York, New YorkRICHARD BROWN
Age: 37
Huntington, New YorkCHRISTOPHER CASTALDO
Age: 44
Glen Head, New YorkGERALD COCUZZO
Age: 37
Delray Beach, FloridaNAVEED KHAN
Age: 33
Staten Island, New YorkHERSCHEL KNIPPA III
Age: 45
Dallas, TexasMAROOF MIYANA
Age: 35
Boca Raton, FloridaPRANAV PATEL
Age: 35
Tamarac, FloridaLOUIS PETROSSI
Age: 75
Reno, NevadaEDNY Docket No. 16-CR-234 (NGG)
[1] The charges announced today are merely allegations, and the defendants are presumed innocent unless and until proven guilty.
Three East Flatbush Gang Members Sentenced for Their Roles in Police Impersonation RobberiesRead the Press Release
Today in Brooklyn federal court, Ringo Delcid, a member of the violent Predator Set street gang operating primarily in the East Flatbush neighborhood of Brooklyn, was sentenced to 130 months of imprisonment for conspiring to commit two Hobbs Act robberies and for the use of a firearm in connection with one of those robberies. Last month, two other members of the gang were also sentenced for their roles in these crimes: Steele was sentenced to 130 months’ imprisonment for his participation in both robberies, and Hall was sentenced to 96 months’ imprisonment for his participation in one of those robberies. All three defendants were convicted following their previously-entered guilty pleas.
The sentence was announced by Robert L. Capers, United States Attorney for the Eastern District of New York; Diego G. Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation (FBI), New York Field Office; and William J. Bratton, Commissioner, New York City Police Department (NYPD).
The convictions resulted from a series of police impersonation robberies committed in 2013. On January 16, 2013, Steele and Delcid committed a home invasion robbery of a narcotics trafficker in Brooklyn. Posing as undercover police officers, the defendants gained access to the residence and proceeded to tie up the trafficker’s girlfriend and twelve-year-old son and ransack the apartment. On July 10, 2013, Steele, Hall, Delcid, and others attempted to rob another narcotics trafficker by carrying out a traffic stop while posing as undercover police officers, complete with a rental car modified to look like a police car. The robbery was thwarted when real NYPD officers arrived at the scene and the defendants fled.
At a hearing on April 14, 2016, U.S. District Judge I. Leo Glasser found that Steele and Hall also conspired to commit a September 27, 2014, armed robbery in which the victim was shot in the leg after he withdrew money from a check-cashing establishment in East Flatbush. The evidence at the hearing established that Steele and Delcid had accumulated an arsenal of weapons in a storage unit in Brooklyn, including three firearms, hundreds of rounds of ammunition, and three homemade silencers, all of which was seized by law enforcement.
“The defendants’ crimes were carefully planned, brazenly executed, and demonstrated a complete disregard for the safety for their victims and the community,” stated United States Attorney Capers. “By impersonating police officers, the defendants took advantage of their victims’ trust in law enforcement; their actions also undermined the operation of legitimate law enforcement officers. The sentences imposed appropriately reflect the seriousness of their crimes and demonstrate our commitment to keeping our neighborhoods safe.” Mr. Capers expressed his grateful appreciation to the FBI’s Violent Crimes squad and the NYPD’s Internal Affairs Division for their cooperation and assistance in the investigation.
FBI Assistant Director-in-Charge Rodriguez stated, “Delcid not only intruded on a residence but he also intruded on the trust the public has with police when he and his coconspirators posed as police officers to commit violent crimes. Serious offenses like this warrant serious sentences and today’s sentencing of Delcid is no exception.”
“These gang members committed gunpoint robberies, violating the public’s trust by impersonating police officers and, in one case, preying upon a woman and child,” said Police Commissioner Bratton. “I would like to thank the members of the NYPD, the FBI, and the U.S. Attorney’s office whose work has led to lengthy prison sentences for the defendants.”
The government’s case is being prosecuted by the Office’s Organized Crime and Gangs Section. Assistant United States Attorneys Alixandra Smith and David Pitluck are in charge of the prosecution.
The Defendants:
BENJAMIN HALL
Age: 21
Brooklyn, New YorkRINGO DELCID
AGE: 27
BROOKLYN, NEW YORKKASAGAMA STEELE
Age: 30
Brooklyn, New YorkE.D.N.Y. Docket No. 14-CR-576 (ILG)
JFK Airport Cargo Handlers Arrested in Scheme to Steal Foreign Currency from Mail Carried on International FlightsRead the Press Release
A criminal complaint was unsealed today in federal court in the Eastern District of New York charging five former employees of Aircraft Service International Group (ASIG) at Terminal One of John F. Kennedy International Airport (JFK Airport), with conspiracy to steal United States Mail. Rickash Gobin, Fitzroy Ragbeer, Franklin Beresford, Pedro Lopez, Jr., and Nick Sadler, also known as “Nickeya Sadler” and “Nicky Sadler,” were arrested earlier today and their initial appearances are scheduled for this afternoon before United States Magistrate Judge Vera M. Scanlon at the United States Courthouse, 225 Cadman Plaza East, Brooklyn, New York.
The charges were announced by Robert L. Capers, United States Attorney for the Eastern District of New York, and Phillip R. Bartlett, Postal Inspector in Charge of the United States Postal Inspection Service’s New York Field Office.
As detailed in the criminal complaint, in a conspiracy spanning over four years, former ASIG cargo handlers Ragbeer, Beresford, Lopez, Jr., and Sadler agreed to steal mail from international flights arriving at and departing from Terminal One of JFK Airport, including Japan Airlines, Austrian Airlines, and LOT Polish Airlines flights. The cargo handlers targeted mail they believed to contain foreign currency, including Japanese Yen and Euros, and then exchanged the foreign currency at currency exchange businesses at JFK Airport, and at other financial institutions.
Gobin, a former manager for ASIG, allegedly not only failed to stop the theft of mail, but actively promoted it by assigning cargo handlers to flights where they could steal mail and demanding kickbacks of stolen currency in exchange.
“As charged, these cargo handlers abused their access to sensitive areas of JFK Airport to steal foreign currency from the mail and were aided by a manager who actively promoted their criminal conduct,” stated United States Attorney Capers. “Today’s arrests will serve as a warning that federal law enforcement authorities are committed to protecting the integrity of the mail and will hold accountable those that steal mail or attempt to profit from the theft of mail.”
“These defendants and their supervisor were entrusted with the security of the mail. They abused that trust when they stole foreign currency from the mail, violating the sanctity of the seal. Postal Inspectors and their law enforcement partners vigorously investigate and bring to justice those who steal US Mail,” stated Postal Inspector in Charge Bartlett.
Previously, on August 18, 2015, postal inspectors arrested six other defendants, including three former ASIG cargo handlers at Terminal One of JFK Airport, on charges that they conspired to steal from the mail and launder foreign currency. The case against those six defendants, captioned United States v. Janvier, et al., Docket No. 15-CR-461 (ARR), is pending before United States District Judge Allyne R. Ross.
The charges in the complaints are merely allegations, and the defendants are presumed innocent unless and until proven guilty.
The government’s case is being prosecuted by Assistant United States Attorney Ian C. Richardson.
The Defendants:
RICKASH GOBIN
Age: 41
Queens, New YorkFITZROY RAGBEER
Age: 58
Inwood, New YorkFRANKLIN BERESFORD
Age: 26
Brooklyn, New YorkPEDRO LOPEZ, JR.
Age: 34
Brooklyn, New YorkNICK SADLER, also known as “Nickeya Sadler” and “Nicky Sadler”
Age: 35
Rockaway Park, New YorkE.D.N.Y. Docket No. 16-M-392
U.S. Attorney Announces Million Dollar Recovery for Unpaid PostageRead the Press Release
ImageStore US Inc. and Mambate USA Inc., doing business as AGPTEK (collectively “AGPTEK”), an Internet-based vendor of a wide variety of merchandise, including consumer electronics, and their shareholder and principal, Charlie Wang, have entered into a settlement agreement with the United States in which they have agreed to pay $1,049,635.82 to resolve civil allegations that they failed to pay postage on large amounts of mail sent through the United States Postal Service.
The settlement was announced today by Robert L. Capers, the United States Attorney for the Eastern District of New York, and Philip R. Bartlett, the Inspector-in-Charge of the New York Division of the United States Postal Inspection Service.
The settlement resolved a multi-year investigation into AGPTEK’s mailings to consumers. AGPTEK sells consumer electronic accessories and replacement parts such as cell phone cases, digital camera batteries, and laptop AC adapters through multiple websites. The United States alleged that from June 2005 to May 2010, AGPTEK mailed over two hundred thousand items to customers either without postage or without sufficient postage. AGPTEK would stamp the packages with an unauthorized postal permit number that was not associated with any credit card or billing account.
In reaching this settlement, AGPTEK and Mr. Wang accepted responsibility for failing to pay sufficient postage during the five year period.
“By failing to pay proper postage, AGPTEK short-changed the Postal Service of funds it depends on from customers to fulfill its mission,” stated U.S. Attorney Capers. “This settlement reflects the commitment of this Office to root out wrongdoing against the Postal Service and ensure it is able to continue providing valuable services to all of its customers.”
“The Postal Inspection Service will vigorously pursue individuals who underpay the Postal Service, and we appreciate U.S. Attorney Capers’ strong stance against those who seek to take advantage of the Postal Service,” said Inspector-in-Charge Philip R. Bartlett.
This case was investigated by the United States Postal Inspection Service and handled by Assistant U.S. Attorney Rachel G. Balaban.
Malian National Sentenced to 25 Years in Prison for Conspiracy to Murder U.S. DiplomatRead the Press Release
Alhassane Ould Mohamed, aka Cheibani, 46, a citizen of Mali, was sentenced to 25 years in prison in the Eastern District of New York for conspiring to murder a U.S. diplomat stationed in Niamey, Niger, in December 2000.
The sentence was announced by Assistant Attorney General for National Security John P. Carlin, U.S. Attorney Robert L. Capers of the Eastern District of New York and Assistant Director in Charge Diego Rodriguez of the FBI New York Field Office.
According to court filings and facts presented during the plea proceeding, in the early morning hours of Dec. 23, 2000, Mohamed and a co-conspirator accosted a group of employees of the U.S. Embassy in Niger as they left a restaurant in Niamey. Carrying a pistol and an AK-47 assault rifle, the two men approached U.S. diplomat William Bultemeier as he was about to enter his car, a white sport-utility vehicle bearing diplomatic license plates clearly indicating that it belonged to the U.S. Embassy. After demanding that Bultemeier turn over the keys to the diplomatic vehicle, the defendant and his co-conspirator shot Bultemeier and Staff Sergeant Christopher McNeely, the Marine Detachment Commander for the U.S. Embassy in Niger at the time, who had run to Bultemeier’s aid. Mohamed and his fellow assailant then drove away in the U.S. Embassy vehicle.
Bultemeier died of the injuries inflicted by the gunshot wounds. Staff Sergeant McNeely survived the shooting and later retired from the Marine Corps as a Master Sergeant.
“The defendant and his confederate murdered U.S. diplomat William Bultemeier in cold blood and seriously injured U.S. Marine Staff Sergeant Christopher McNeely, who bravely risked his life to attempt to save his colleague,” said U.S. Attorney Capers. “Although nothing can undo the pain caused by the defendant’s violent actions, we hope the victims’ families can take some measure of solace in knowing that the defendant is being held accountable for the senseless murder of Mr. Bultemeier and the attack on Staff Sergeant McNeely. The United States takes the protection of its employees stationed overseas very seriously and will continue to work tirelessly to bring those who harm our diplomats to justice.”
“Over the past 16 years, Cheibani evaded full accountability for his murderous actions in taking the life of a U.S. Diplomat,” said Assistant Director in Charge Rodriguez. “U.S. employees working overseas understand there are certain risks in representing their government in foreign territories; however, a death sentence should not be one of them. We are extremely grateful to the governments of Niger and Mali, in helping U.S. authorities seek justice for Cheibani’s crime. FBI New York’s Joint Terrorism Task Force, along with the U.S. Attorney’s Office, conducted a thorough investigation and collected the necessary evidence to substantiate today’s sentence. Our condolences to the family of Mr. Bultemeier and the families of all crime victims. FBINY will continue to work, day and night, to hold those accountable for their crimes, and prevent acts of terror against our citizens, both domestically and abroad.”
The sentencing took place before U.S. District Judge William F. Kuntz II of the Eastern District of New York.
Assistant Attorney General Carlin joined U.S. Attorney Capers in expressing their sincere gratitude to the members of the FBI’s Joint Terrorism Task Force for their thorough investigation, to the Department of State’s Diplomatic Security Service for the assistance they provided and to the governments of Niger and Mali for their substantial assistance and cooperation in connection with this investigation. The Department of Justice’s Office of International Affairs also provided significant assistance. The case is being prosecuted by Assistant U.S. Attorneys Zainab Ahmad, Margaret Lee and Melody Wells of the Eastern District of New York with assistance provided by Trial Attorney Jennifer Levy of the National Security Division’s Counterterrorism Section.
Malian National Sentenced Today in Brooklyn Federal Court to 25 Years for Conspiracy to Murder A U.S. DiplomatRead the Press Release
Earlier today, Alhassane Ould Mohamed, also known as “Cheibani,” a citizen of Mali, was sentenced to 25 years’ imprisonment at the federal courthouse in Brooklyn, New York, for conspiring to murder a United States diplomat stationed in Niamey, Niger, in December 2000.
The sentence was announced by Robert L. Capers, United States Attorney for the Eastern District of New York, and Diego G. Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation.
According to court filings and facts presented during the guilty plea proceeding, in the early morning hours of December 23, 2000, the defendant and a co-conspirator accosted a group of employees of the United States Embassy in Niger as they left a restaurant in Niamey, Niger. Carrying a pistol and an AK-47 assault rifle, the two men approached Department of Defense official William Bultemeier as he was about to enter his car, a white sport-utility vehicle bearing diplomatic license plates clearly indicating that it belonged to the United States Embassy. After demanding that Mr. Bultemeier turn over the keys to the diplomatic vehicle, the defendant and his co-conspirator shot Mr. Bultemeier and Staff Sergeant Christopher McNeely, the Marine Detachment Commander for the United States Embassy in Niger at the time, who had run to Mr. Bultemeier’s aid. The defendant and his fellow assailant then drove away in the United States Embassy vehicle.
Mr. Bultemeier died of the injuries inflicted by the gunshot wounds. Staff Sergeant McNeely survived the shooting and later retired from the Marine Corps as a Master Sergeant.
“The defendant and his confederate murdered U.S. diplomat William Bultemeier in cold blood and seriously injured U.S. Marine Staff Sergeant Christopher McNeely, who bravely risked his life to attempt to save his colleague,” stated United States Attorney Capers. “Although nothing can undo the pain caused by the defendant’s violent actions, we hope the victims’ families can take some measure of solace in knowing that the defendant is being held accountable for the senseless murder of Mr. Bultemeier and the attack on Staff Sergeant McNeely. The United States takes the protection of its employees stationed overseas very seriously and will continue to work tirelessly to bring those who harm our diplomats to justice.” Mr. Capers expressed his sincere gratitude to the members of the FBI’s Joint Terrorism Task Force for their thorough investigation, to the Department of State’s Diplomatic Security Service for the assistance they provided, and to the governments of Niger and Mali for their substantial assistance and cooperation in connection with the investigation.
FBI Assistant Director-in-Charge Rodriguez stated, “Over the past 16 years, Cheibani evaded full accountability for his murderous actions in taking the life of a U.S. Diplomat. U.S. employees working overseas understand there are certain risks in representing their government in foreign territories; however, a death sentence should not be one of them. We are extremely grateful to the governments of Niger and Mali, in helping U.S. authorities seek justice for Cheibani’s crime. FBI New York’s Joint Terrorism Task Force, along with the U.S. Attorney’s Office, conducted a thorough investigation and collected the necessary evidence to substantiate today’s sentence. Our condolences to the family of Mr. Bultemeier and the families of all crime victims. FBINY will continue to work, day and night, to hold those accountable for their crimes, and prevent acts of terror against our citizens, both domestically and abroad.”
Today’s sentencing took place before United States District Judge William F. Kuntz, II.
The government’s case is being prosecuted by the Office’s National Security & Cybercrime Section. Assistant United States Attorneys Zainab Ahmad, Margaret Lee, and Melody Wells are in charge of the prosecution, with assistance provided by the Trial Attorney Jennifer Levy of the Justice Department’s Counterterrorism Section and by the Justice Department’s Office of International Affairs.
The Defendant:
ALHASSANE OULD MOHAMED
Age: 46E.D.N.Y. Docket No. 13-527 (WFK)
Defendant Convicted at Trial for His Involvement in Multiple Queens Extortion Schemes Carried Out with New York City Police OfficerRead the Press Release
Yesterday, following two and a half weeks of trial, a federal jury in Brooklyn, New York, returned a guilty verdict against Redinel Dervishaj, on Hobbs Act extortion conspiracy, attempted extortion, threatening/committing physical violence in furtherance of an extortion plan, and related charges involving brandishing firearms. The charges arose out of the defendant’s schemes to extort three small business owners in Queens, New York. When sentenced by United States District Judge Eric N. Vitaliano, the defendant faces a maximum sentence of life imprisonment and a mandatory minimum of 57 years in prison. Co-defendants Besnik Llakatura, a police officer with the New York City Police Department during the charged crimes, and Denis Nikolla previously pleaded guilty in this case and are awaiting sentencing.
The verdict was announced by Robert L. Capers, United States Attorney for the Eastern District of New York, Diego Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office, and William J. Bratton, Commissioner, New York Police Department.
“Through fear, intimidation and threats of violence, Dervishaj and his co-defendants demanded payment from local business owners in Astoria, Queens, for so-called protection,” stated United States Attorney Capers. “When the victims refused to pay, the defendants escalated their efforts to secure payment, brazenly threatening the business owners with firearms. Yesterday, Dervishaj was held accountable for the harm he caused and the fear he engendered.”
“Dervishaj’s tactics of fear, intimidation, and violence will work no more. Yesterday, he was convicted by a jury on charges relating to his role in extorting small business owners in Queens for payments for so-called protective services. The FBI thanks our law enforcement partners at the U.S. Attorney’s Office in the Eastern District of New York for their work on this case,” stated FBI Assistant Director-in-Charge Rodriguez.
“The defendant faces a minimum sentence of more than a half-century in prison, which should serve to discourage others from attempting to use intimidation and threats of violence to bilk legitimate businesspeople,” stated New York Police Commissioner Bratton.
As proven at trial, between May and November 2013, Dervishaj and his co-defendants conspired and attempted to extort a Queens restaurant owner, demanding regular payments in exchange for so-called protection. The extortion began shortly after the victim opened a restaurant in Astoria when he was visited by Dervishaj and told that he had opened a business in “our neighborhood.” As a result, the restaurant owner was required to pay Dervishaj $4,000 per month. He then sought help from Besnik Llakatura, whom the restaurant owner believed was his friend. Unbeknownst to him, Llakatura, an NYPD officer in Staten Island since 2006, was conspiring with Dervishaj in the extortion and actively discouraged the restaurant owner from going to the police. Llakatura sought to persuade the victim that he had no choice but to make the demanded payments, warning him that Dervishaj and his associates would physically harm him if he did not pay. When the victim resisted, at Dervishaj’s direction co-conspirator Denis Nikolla threatened the victim with physical violence and chased him at gunpoint down a street in Queens. Over the course of five months, each of the three defendants took turns collecting monthly payments from the victim, ultimately collecting $24,000 in so-called protection money.
Between April 2012 and November 2013, Dervishaj and Nikolla also conspired and attempted to extort the proceeds of two nightclubs located in Queens, New York, and used a firearm in their efforts to do so. After the nightclub owner failed to make the demanded payments, on September 20, 2012, Dervishaj and Nikolla confronted the victim at a bar in Astoria; Nikolla took a firearm from Dervishaj’s waistband and pressed it to the victim’s ribs, threatening to beat him in front of his wife and children and, threatening to beat his wife and children in front of him.
Finally, during 2013, Dervishaj and his co-defendants conspired and attempted to extort a proprietor of two social clubs in Astoria. After the initial extortion demand, the proprietor refused to make the payments and ceased going to his social clubs out of fear for his safety. Thereafter, the defendants attempted to locate the proprietor and threaten him. In one instance, Dervishaj threatened and repeatedly punched a friend of the victim, while a co-conspirator pulled a gun on him. The victim ultimately fled the country for a period of time to avoid the defendants’ threats.
The government’s case is being prosecuted by the Office’s Organized Crime and Gangs Section. Assistant United States Attorneys Nadia Shihata and Patrick Hein are in charge of the prosecution.
The Defendant:
REDINEL DERVISHAJ
Age: 40
Queens, New YorkE.D.N.Y. Docket No. 13-CR-668 (ENV)
United States Attorneys Available to Receive Election ComplaintsRead the Press Release
ROBERT L. CAPERS and PREET BHARARA, the United States Attorneys for the Eastern and Southern Districts of New York, respectively, announced today that special telephone numbers have been set up to receive complaints of possible violations of federal election laws relating to the upcoming primary elections in New York City and other counties in their districts.
The United States Attorneys said that their Offices will be available to receive complaints at the following numbers on Tuesday, April 19, 2016:
(718) 254-6323 (for Brooklyn, Queens, Staten Island, Nassau and Suffolk counties)
(212) 637-0840 (for Manhattan, Bronx, Dutchess, Orange, Putnam, Rockland,
Sullivan and Westchester counties)
In addition, complaints of possible violations of federal election laws may be made directly to the Federal Bureau of Investigation (FBI) at (212) 384-1000.
Spokespeople for the United States Attorneys said that the enforcement of federal laws protecting the rights of all eligible persons to vote for the candidates of their choice is a high priority of the Department of Justice.
It is unlawful under federal law to deny or abridge anyone’s right to vote because of race, color or national origin. Federal laws also require local election authorities to make voting accessible to disabled and elderly voters. Voters who require assistance because of blindness, disability or inability to read and write have the right to receive such assistance from a person of their own choosing. In counties with substantial numbers of non-English speaking voters, federal laws prohibit the denial or abridgement of a voter’s ability to participate in the election process in certain languages other than English (i.e., Spanish, Chinese, Korean).
In addition, certain activities designed to subvert the integrity of the election process are federal crimes. It is a federal crime, for example, to deprive citizens of their right to fair elections or to conspire to do so. Specific election laws also make it a crime to bribe or intimidate voters, to cause ballots to be cast fraudulently in the names of individuals who did not vote (“ballot stuffing”), to vote more than once, or to alter or falsely report the vote count. It can also be a federal offense to challenge qualified voters without cause and in bad faith or to harass persons seeking to vote for the purpose of discouraging their vote.
The Offices of the United States Attorneys said that the ability of federal law enforcement authorities to detect and eliminate improper restrictions on voting rights and to prosecute election fraud depends to a large extent on the watchfulness and cooperation of the voters. It is therefore imperative that those who have been asked to participate in illegal election practices, who have been the subject of such practices, who have observed such practices, or who have information bearing on such practices, make that information known promptly to the FBI or the United States Attorneys at the telephone numbers listed above.
The United States Attorneys also noted that the following additional telephone numbers are available on April 19 for citizens to call for routine inquiries, such as where to vote or how late the polls are open, or to register complaints that may concern violations of New York State election laws:
IN NEW YORK CITY
City Board of Elections
Main Office (212) 487-5300
(212) 868-3692
Bronx (718) 299-9017
Brooklyn (718) 797-8800
Manhattan (212) 886-2100
Queens (718) 730-6730
Staten Island (718) 876-0079
IN COUNTIES OUTSIDE NEW YORK CITY
County Boards of Elections
Dutchess (845) 486-2473
Nassau (516) 571-2411
Orange (845) 291-2444
Putnam (845) 278-6970
Rockland (845) 638-5172
Suffolk (631) 852-4500
Sullivan (845) 794-3000
Westchester (914) 995-5700
Assistant United States Attorney Catherine M. Mirabile is responsible for overseeing the handling of complaints of voting rights abuses and election fraud for the Eastern District of New York.
Assistant United States Attorney David J. Kennedy is responsible for overseeing the handling of complaints of voting rights abuses and election fraud for the Southern District of New York.
MS-13 Member Sentenced to 45 Years in Prison for Double-MurderRead the Press Release
Earlier today at the federal courthouse in Central Islip, New York, Rene Mendez Mejia, also known as “Zorro,” a member of La Mara Salvatrucha, also known as the MS-13 street gang, was sentenced to 45 years in prison by United States District Judge Joseph F. Bianco.
As established in prior filings, court proceedings, and sentencing memoranda, Mejia and two other MS-13 members, Adalberto Ariel Guzman and Juan Garcia, shot and killed 19-year-old Vanessa Argueta and her two-year-old son, Diego Torres, in Central Islip, New York, on February 5, 2010, after luring them to a secluded wooded area. Mejia and Garcia shot Argueta in the head and chest, respectively, and Guzman shot Torres twice in the head. Mejia and other MS-13 members, including MS-13 leader, Heriberto Martinez, Guzman, and Garcia had plotted to kill Argueta because they believed she had disrespected the MS-13 by sending rival gang members to attack Garcia.
After committing the murders, Mejia and his co-conspirators fled to El Salvador. Guzman and Mejia were arrested in May 2010 when they returned to the United States, but Garcia remained a fugitive for four years until March 2014, when, after being placed on the FBI’s Ten Most Wanted Fugitives List, he surrendered to law enforcement authorities in Nicaragua, waived extradition, and was returned to the United States for prosecution. Mejia pled guilty on June 15, 2011.
The sentencing was announced by Robert L. Capers, United States Attorney for the Eastern District of New York, Diego Rodriguez, Assistant Director-in-Charge, FBI, New York Field Office, and Timothy Sini, Commissioner, Suffolk County Police Department.
“Mejia and his fellow MS-13 members brutally and senselessly executed a young woman and her two-year-old child. While nothing can reverse this tragedy, we hope that today’s sentence and the convictions and sentencings of Mejia’s co-conspirators have brought the victims’ families some measure of justice and comfort,” stated United States Attorney. “My Office and our law enforcement partners will continue to be vigilant and aggressively prosecute the MS-13 and other criminal organizations who unleash violence on our communities.” United States Attorney Capers expressed his sincere gratitude to the members of the FBI’s Long Island Gang Task Force for their tenacious investigation and unwavering commitment to bring Mejia and his co-conspirators to justice for the Argueta and Torres murders.
“As the last defendant is sentenced for the brutal murders of a young woman and her toddler son by MS-13 gang members, we hope the victims’ family can finally feel justice has been served. The FBI is committed to working with our partners to not only root-out gangs in our communities but also bring their crimes to justice no matter how long it takes,” said FBI Assistant Director-in-Charge Rodriguez.
“This prosecution exemplifies the ruthless and senseless violence committed at the hands of MS-13 gang members, which threatens the very fabric of our communities. The Suffolk County Police Department will continue to aggressively work with our law enforcement partners to bring these violent criminals to justice,” stated Commissioner Sini.
Mejia’s three co-conspirators, Martinez, Guzman, and Garcia were also arrested and indicted in connection with the Argueta and Torres murders. Martinez was convicted in March 2013, following a six-week trial, in connection with the Argueta murder, as well as the March 6, 2010, murder of Nestor Moreno in Hempstead, New York, and the March 17, 2010 murder of Mario Alberto Canton Quijada in Far Rockaway, New York, and later sentenced to life in prison, plus 60 years. Guzman was convicted on charges relating to the Argueta and Torres murders in September 2013, following a three-week trial, and later sentenced to life in prison, plus 35 years. Garcia pled guilty and was sentenced to life in prison for his role in the Argueta and Torres murders.
The convictions of Mejia and his co-defendants are 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 international 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 largest and 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 this district. A majority of those MS-13 members have been convicted on federal racketeering charges for participating in murders, attempted murders, and assaults. Since 2010 alone, this Office has obtained indictments charging MS-13 members with carrying out more than 30 murders, 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, Nassau County Police Department, Nassau County Sheriff’s Department, Suffolk County Probation, Suffolk County Sheriff’s Department, Rockville Centre Police Department, and Suffolk County Police Department.
The government’s case is being prosecuted by Assistant United States Attorneys John J. Durham and Raymond A. Tierney from the Office’s Long Island Criminal Division.
The Defendant:
RENE MENDEZ MEJIA
Age: 22
East Patchogue, New YorkE.D.N.Y. Docket No. 10-CR-074 (JFB)
Member of Alleged International Organization of Money Launderers for the Largest Drug Cartels Extradited to the United StatesRead the Press Release
Earlier today, Jhon Jairo Hincapie-Ramirez, a citizen of Colombia, was arraigned at the federal courthouse in Brooklyn, New York, for his alleged role in an international money laundering organization that brokered financial transactions designed to conceal the source of illegal narcotics trafficking by using the Chinese and Hong Kong financial system and the shipment of counterfeit goods around the world to launder over $5 billion for drug cartels based in Mexico and Colombia.[1] Hincapie-Ramirez was arrested in Colombia in August 2015, on a provisional arrest warrant issued from the Eastern District of New York, and was extradited to the United States on April 14, 2016.
The arraignment was announced by Robert L. Capers, United States Attorney for the Eastern District of New York.
As alleged in the superseding indictment, the investigation determined that from approximately January 1, 2004 through December 31, 2014, members of the organization conspired to carryout trade-based money laundering activities in China, Colombia, Panama, the United States, Spain, Ecuador, Venezuela, and elsewhere. The group was led by Colombian nationals based in Guangzhou, China (the Guangzhou Enterprise). The Guangzhou Enterprise laundered money through bank accounts in Hong Kong and China on behalf of drug trafficking organizations in Mexico and Colombia to fund purchases of counterfeit goods in China, which were then shipped to Colombia and elsewhere for resale.
The Guangzhou Enterprise typically paid Colombian pesos to the drug traffickers in exchange for their U.S. dollar proceeds of drug trafficking at a heavily discounted exchange rate, which reflected the risks incurred by the money brokers. The Enterprise then located Colombian or other South American customers – usually businesses – that needed U.S. dollars to pay for imported goods or services. They then sold the U.S. dollars to those customers, who used the money to purchase goods and services in China for resale.
United States Attorney Capers thanked the Drug Enforcement Administration, New York Division; Internal Revenue Service-Criminal Investigation, New York Field Office; the Department of Justice, Office of International Affairs; DEA Dallas Field Office; New York City Police Department; New York State Police; DEA Beijing Country Office; DEA Hong Kong Country Office; IRS Beijing Country Office; IRS Hong Kong Country Office; the Financial Investigations Group of the Hong Kong Customs and Excise Department; and the Chinese Ministry of Public Security for their assistance in this case.
The government’s case is being prosecuted by the Office’s International Narcotics and Money Laundering Section. Assistant United States Attorneys Tyler J. Smith and Ameet B. Kabrawala are in charge of the prosecution.
The Defendant:
JHON JAIRO HINCAPIE-RAMIREZ
Alias: El Profe
Age: 55
Nationality: ColombianE.D.N.Y. Docket No. 15-CR-81 (CBA)
[1] The charges in the indictment are merely allegations, and the defendant is presumed innocent unless and until proven guilty.
Former High-Ranking FIFA and CONCACAF Official Pleads Guilty to Racketeering and Corruption ChargesRead the Press Release
Earlier today in federal court in Brooklyn, Alfredo Hawit, a former FIFA vice president and executive committee member, the former president of CONCACAF, and the former president and general secretary of the Honduran soccer federation (FENAFUTH), pleaded guilty to one count of racketeering conspiracy, two counts of wire fraud conspiracy, and one count of conspiracy to obstruct justice in connection with his receipt of bribes in exchange for the awarding of contracts for the media and marketing rights to CONCACAF tournaments and FIFA World Cup qualifier matches. Hawit, who served in high-ranking positions in soccer from 1998 to 2015, also agreed to forfeit $950,000. At sentencing, Hawit faces a maximum sentence of 20 years for each count. Today’s plea proceeding took place before United States District Judge Raymond J. Dearie.
The guilty plea was announced by Robert L. Capers, United States Attorney for the Eastern District of New York; Diego G. Rodriguez, Assistant Director in Charge, FBI, New York Field Office; and Acting Special Agent in Charge Anthony J. Orlando, IRS Criminal Investigation, Los Angeles Field Office.
According to court filings and facts presented during the plea proceeding, in approximately 2011 and 2012, Hawit negotiated and accepted hundreds of thousands of dollars in bribes in exchange for his agreement to exercise his influence as acting president of CONCACAF to award an Argentine sports marketing company the media and marketing rights to CONCACAF tournaments, including the Gold Cup and the CONCACAF Champions League. Starting in approximately 2008, Hawit also negotiated and accepted hundreds of thousands of dollars in bribes in exchange for his agreement to exercise his influence as the FENAFUTH general secretary to award contracts to Media World, a Florida sports marketing company, for the media and marketing rights to the Honduran national soccer team’s home World Cup qualifier matches for the 2014, 2018, and 2022 editions of the World Cup. Over a period of years, Media World transmitted these bribes from its U.S. bank accounts, through an intermediary, to foreign bank accounts controlled by the defendant’s family members and by a co-conspirator. In addition, after the original indictment in this case was unsealed on May 27, 2015, Hawit engaged in a conspiracy to obstruct justice, and to tamper with witnesses and evidence, by advising a co-conspirator to create sham contracts in order to mask bribe payments already paid and, if asked, deceive law enforcement officers about the true nature and purpose of bribe payments.
The guilty plea announced today is part of an investigation into corruption in international soccer being led by the U.S. Attorney’s Office for the Eastern District of New York, the FBI New York Field Office, and the IRS-CI Los Angeles Field Office. The prosecutors in Brooklyn are receiving considerable assistance from attorneys in various parts of the Justice Department’s Criminal Division in Washington, D.C., including the Office of International Affairs, the Organized Crime and Gang Section, the Asset Forfeiture and Money Laundering Section, and the Fraud Section, as well as from INTERPOL Washington.
Assistant U.S. Attorneys Evan M. Norris, Amanda Hector, Paul Tuchmann, Nadia Shihata, Keith D. Edelman, and Brian D. Morris of the Eastern District of New York are in charge of today’s prosecution.
The government’s investigation is ongoing.
The Defendant:
ALFREDO HAWIT
Age: 64
Nationality: HondurasE.D.N.Y. Docket No. 15 CR 252 (S-1)
Federal Jury Finds Crips Gang Leader Guilty of RacketeeringRead the Press Release
Following four weeks of trial, a federal jury in Central Islip, NY, returned a guilty verdict today against Raphael Osborne, also known as “Gusto,” a Crips street gang leader from Roosevelt, NY, on twenty-one counts including racketeering, conspiracy, robbery, attempted murder, witness retaliation, assault with a dangerous weapon, drug conspiracy and brandishing and discharging firearms during the commission of these offenses. Osborne faces a minimum of 115 years and up to life imprisonment as a result of these convictions.
The verdict was announced by Robert L. Capers, United States Attorney for the Eastern District of New York; Diego Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); Madeline Singas, Nassau County District Attorney; and Thomas C. Krumpter, Acting Nassau County Police Commissioner.
At trial, the government successfully proved that Osborne led the Roosevelt, NY-based Rollin’ 60s Crips, a racketeering enterprise that engaged in multiple crimes of violence and narcotics trafficking. Between 2003 and 2013, members of the gang followed an “on sight” rule established by Osborne that commanded gang members to attack rival Bloods in Roosevelt whenever possible and by whatever means available. In addition, numerous other shootings and murders were committed at Osborne’s direction. During the trial, the government elicited details of 15 shootings and three homicides that were committed by members of the Rollin’ 60s during Osborne’s reign and established that the gang financed its activities through firearms and narcotics trafficking. Over the course of the conspiracy, the gang was responsible for bringing hundreds of illegal firearms to Long Island, including revolvers, semi-automatic handguns, assault rifles, and submachine guns.
Among other crimes, Osborne was convicted of:
Conspiring to murder and attempted murder of a federal informant in October 2012. Beginning in the spring of 2012, law enforcement, with the aid of a Rollin’ 60s gang member informant, began purchasing firearms from the gang, including some from Osborne’s residence on Debevoise Avenue in Roosevelt. After the informant attempted to purchase a firearm from Osborne in June 2012, Osborne became suspicious and ordered other gang members to kill him. On October 13, 2012, a gang member lured the informant from his Hempstead home to a location where a fellow gang member was waiting. The informant was shot five times at close range, leaving him paralyzed.
The January 2013 attempted murder and assault of a rival Bloods gang member. On January 30, 2013, Osborne and other ranking members of the Rollin’ 60s followed a vehicle occupied by several Bloods gang members to a house on Pleasant Avenue in Roosevelt. As the rivals’ vehicle turned into the driveway of the residence, Osborne and other gang members unleashed a barrage of .40 and .45 caliber bullets that ripped through the vehicle and sent one of the Bloods members to the hospital with a gunshot wound to his abdomen.
Two robberies that he committed with other members of the gang in the fall of 2010. The first robbery involved a gang member stealing marijuana and cash from the victim, while Osborne dragged the victim from his vehicle and pistol whipped him in the street. In the second robbery, Osborne directed gang members to the home of a drug dealer who was robbed at gunpoint.
Conspiring to distribute 280 grams of crack cocaine, 100 grams of heroin, 100 kilograms of marijuana, and quantities of methylone, commonly known as “molly.”
“The crimes that Osborne stands convicted of underscore the wanton violence the Crips street gang unleashed on neighborhoods of Long Island,” stated United States Attorney Capers. “Street gangs such as the Crips infect communities, and we will continue to respond to the Crips’ brutal violence with unwavering investigation and prosecution – they will be brought to justice and prosecuted to the fullest extent of the law.” Mr. Capers extended his grateful appreciation to each of the law enforcement agencies for their assistance in this case, in particular the Special Investigations Squad of the Nassau County Police Department and the FBI’s Long Island Gang Task Force.
Assistant Director-in-Charge Rodriguez stated, “The verdict against Raphael Osborne leaves the area of Roosevelt a little safer today. During his time as a Crips leader, Osborne directed attacks against rival gangs in the Roosevelt area by any means available. The FBI will continue to work with our law enforcement partners to dismantle gangs and the violence they bring to our communities.”
District Attorney Singas stated, “This defendant and his fellow gang members brought illegal guns, deadly drugs, and unbridled violence into communities on Long Island. He oversaw a ruthless enterprise that trafficked in assault weapons, handguns, cocaine, and heroin, and left many victims in its wake. I thank all of our partners who took part in the dangerous and important work to arrest and prosecute this defendant and his associates.”
Acting NCPD Police Commissioner Krumpter stated, “Crime has no boundaries and this case is an example of how partners in law enforcement utilized talented personnel and resources to bring this defendant to justice. Today’s arrest should serve as a deterrent to criminals as we at the Nassau County Police Department are committed to working with our fellow law enforcement partners to ensure public safety.”
Upon sentencing the defendant Osborne faces a potential sentence of up to life imprisonment.
Osborne is the fourteenth member of the gang to be convicted since the inception of this case. Three other members of the gang are pending trial.
The government’s case was prosecuted by Assistant United States Attorneys Nicole Boeckmann, Christopher Caffarone, and Special Assistant United States Attorney Michael Maffei.
The Defendant:
Raphael Osborne (a/k/a Gusto)
Age: 30E.D.N.Y. Docket No. 14-264 (JS)
Gambino Crime Family Associate Gennaro Bruno Pleads Guilty to 2002 Murder of Martin BosshartRead the Press Release
Earlier today, Gennaro “Jerry” Bruno, an associate of the Gambino organized crime family of La Cosa Nostra (the “Gambino crime family”) pleaded guilty at the federal courthouse in Brooklyn, NY, to racketeering and admitted to murdering Martin Bosshart on January 2, 2002 and conspiring to prevent testimony in a grand jury investigation into the Bosshart murder. Today’s plea took place before United States District Judge William F. Kuntz, II, who accepted Bruno’s plea. Pursuant to Bruno’s plea agreement with the government, Bruno will be sentenced to 21 years in prison. Sentencing is scheduled for May 6, 2016.
The plea was announced by Robert L. Capers, United States Attorney for the Eastern District of New York, and Diego Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI). For their outstanding investigative work and assistance in this case, Mr. Capers extended his grateful appreciation to the FBI, the New York City Police Department, the Queens County District Attorney, and the U.S. Attorney’s Office for the Southern District of New York.
According to court filings and facts presented during the plea proceeding, Bruno became an associate in the Corozzo Faction of the Gambino crime family by approximately 2000, after proving himself over a number of years as a member of a violent gang called the “Young Guns.” Over the next 14 years, Bruno engaged in numerous crimes with and on behalf of a faction of the Gambino crime family aligned with Joseph “JoJo” Corozzo, a powerful Gambino member who had risen to become the consigliere of the family. Bruno and other Gambino crime family members and associates moved large quantities of high-potency marijuana from Canada into the New York City area. In 2001, Bruno’s criminal associate Martin Bosshart began making efforts to exclude one of Bruno’s coconspirators from the marijuana importation operation. In an effort to prevent Bosshart from doing so, Bruno plotted with other Gambino crime family members and associates to murder Bosshart. On the night of January 2, 2002, Bruno lured Bosshart to an isolated location in Queens, NY. There, Bruno shot Bosshart in the back of the head at point-blank range, killing him immediately. The body of Martin Bosshart, who was 30 years old at the time, was recovered at the scene.
Thereafter, Bruno evaded justice for years and conspired with other Gambino associates to obstruct an official grand jury investigation into the Bosshart murder, all the while continuing to participate in the core money-making activities of the Gambino crime family, including drug trafficking and extortion. As part of the alleged pattern of racketeering, Bruno, among other things, used his position in the Gambino crime family to extract extortionate payments from the owner of a waste carting company in Queens, NY. Bruno was arrested in Las Vegas on October 28, 2014, and removed to the Eastern District of New York to face the charges against him.
The government’s case is being prosecuted by Assistant United States Attorneys M. Kristin Mace, Nadia Shihata, and Mathew Miller.
The Defendant:
GENNARO BRUNO, a/k/a “Jerry”
Age: 43
Las Vegas, NevadaE.D.N.Y. Docket No. 14-CR-556 (WFK)
U.S. Attorney Announces Return to Mongolia of Looted Dinosaur FossilsRead the Press Release
This afternoon, Robert L. Capers, United States Attorney for the Eastern District of New York, will host a repatriation ceremony at which the United States will return to Mongolia the fossilized remains of six species of dinosaur. The fossils were unlawfully removed from Mongolia and seized by U.S. Immigration and Customs Enforcement (ICE) agents in New York and Utah.
The largest of these fossils, an Alioramus skull, was forfeited to the United States as a result of a civil forfeiture action handled by the U.S. Attorney’s Office. The other fossils being returned at today’s ceremony were administratively forfeited by ICE and U.S. Customs and Border Protection (CBP). HSI Executive Associate Director of Homeland Security Investigations (HSI) Peter T. Edge and Mongolia’s Ambassador to the United States Altangerel Bulgaa will sign the ceremonial certificates transferring ownership of the fossils from the United States to Mongolia. Mongolian paleontologist Dr. Bolortsetseg Minjin, and Director of the Institute for the Study of Mongolian Dinosaurs, will participate in the ceremony as a representative of the Mongolian Ministry of Education, Culture and Sciences.
“Mongolia is home to the world’s largest reserve of dinosaur fossils with many discoveries waiting to be made,” stated U.S. Attorney Capers. “We are proud of our role in restoring this rich paleontological heritage to the Mongolian people and taking these cultural treasures from the hands of looters and smugglers. We stand beside the people of Mongolia by disrupting the international trade in smuggled fossils and returning them to their home where they will be studied and treasured.”
“Today’s ceremony is an excellent demonstration of the cooperation between HSI, our colleagues at the Department of Justice, and our foreign counterparts with the Government of Mongolia,” stated HSI Executive Associate Director Edge. “A successful repatriation requires extensive cooperation among all parties involved, which is rewarded by the knowledge that we’ve returned what rightfully belongs to the people of Mongolia.”
“CBP is extremely proud to have played an important role in returning these valuable national treasures to the people of Mongolia,” said Robert E. Perez, Director of CBP’s New York Field Operations. “CBP’s cooperation with HSI and the United States Attorney’s Office for Eastern District of New York demonstrates the continuing resolve of law enforcement in the United States to address illegal trafficking in stolen artifacts.”
“Three years ago, we celebrated our first repatriation ceremony of the skeleton of a Tarbosaur-Bataar. The T-Bataar case was a unique one in many aspects. Most importantly, it has laid foundation of further strong and fruitful cooperation between our two governments in the fight against illegal trade of cultural heritages including fossils. Thanks to this fruitful cooperation, 23 dinosaur fossils were repatriated to Mongolia during the last three years and now we are witnessing a repatriation of seven fossils including an Alioramus skull,” stated Ambassador Altangerel. “I take this opportunity, on behalf of the Government and people of Mongolia, to express our profound gratitude for the hard work and dedication of American law enforcement agencies. I have no doubt that these efforts will further strengthen of our bilateral ties, opening new opportunities and giving new impetus to our future cooperation.”
The Mongolian dinosaur fossils being returned at today’s repatriation ceremony include:
- Alioramus skull
- Bactrosaurus skeleton
- Protoceratops baby skeleton pieces
- Troodontid egg bed
- Psittacosaurus skeleton and skull
- Hadrosaurus skeleton pieces
The Alioramus was a dinosaur that lived in the late Cretaceous period, approximately 65 to 70 million years ago. It is related to the Tyrannosaurus and Tarbosaurus. The Alioramus skull was seized by CBP after being shipped from France with false declarations which suggested that it was an inexpensive replica, not a genuine fossil. When the shipper petitioned for the Alioramus skull’s release, it conceded that it was a genuine Mongolian fossil but submitted forged Mongolian export documents. Mongolian patrimony laws prohibit the export and foreign ownership of dinosaur fossils.
According to Dr. Bolortsetseg Minjin, the Alioramus is an extremely rare dinosaur; only two specimens have been reported in the scientific literature, and both are from Mongolia. The Alioramus fossil being returned today is the most complete skull discovered to date. Its relative completeness, color and overall state of preservation are typical of the Nemegt Formation, which is only exposed in the Gobi Desert of Mongolia. In 2014, Mongolia nominated the Nemegt Formation and other fossil sites in the Gobi Desert for inclusion in the World Heritage List, citing the sites’ distinction as the largest dinosaur fossil reservoir in the world.
The government’s civil forfeiture action against the Alioramus skull was handled by Assistant United States Attorney Karin Orenstein.
E.D.N.Y. Docket No. 14-CV-5198 (BMC)
School Construction Authority General Contractor Sentenced to 96 Months in Prison for Long-Running Scheme to Deprive Workers of the Prevailing WageRead the Press Release
Earlier today in Brooklyn federal court, Muzaffar Nadeem, the owner of SM&B Construction Co., Inc. (SM&B), was sentenced to 96 months’ imprisonment, ordered to pay more than $1.3 million in restitution to the IRS, and ordered to forfeit to the government over $7.1 million in criminal proceeds, following his convictions on May 8, 2015, after a four-week jury trial, for mail and wire fraud, structuring financial transactions, federal programs bribery, making illegal cash payments to a union official, money laundering, unlawful monetary transactions over $10,000, subscribing to false tax returns, and multiple related conspiracy charges.
The convictions arose out of Nadeem’s leadership role in a long-running scheme to pay SM&B’s workers a fraction of the prevailing wage on projects funded by the New York City School Construction Authority (SCA), as SM&B was legally and contractually required to do. Nadeem’s co-conspirators Zainul Syed, Afzaal Chaudry and Irfan Muzaffar were also convicted at trial of various crimes for their participation in this scheme. Muzaffar was previously sentenced to 18 months’ imprisonment, and Chaudry was previously sentenced time served, following approximately ten months of imprisonment. Syed is awaiting sentencing. The sentencing proceedings were held before U.S. District Judge Brian M. Cogan.
The sentence was announced by Robert L. Capers, United States Attorney for the Eastern District of New York; Shantelle P. Kitchen, Special-Agent-in-Charge, Internal Revenue Service, Criminal Investigation, New York; and Jonathan Mellone, Acting Special Agent-in-Charge, U.S. Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations.
“Contractors who perform public works in New York City and New York State are on notice that if they line their pockets by cheating workers out of the wages to which they are entitled will be vigorously prosecuted,” stated United States Attorney Capers. Mr. Capers expressed his grateful appreciation to the Office of the New York State Attorney General and that office’s Organized Crime Task Force, the New York City Department of Investigation, the New York City School Construction Authority, Office of Inspector General, the New York City Police Department, and the New York County District Attorney’s Office for their assistance in the investigation and prosecution of the defendant.
IRS Special Agent-in-Charge Kitchen stated, “The conviction of Mr. Nadeem and his co-conspirators and now, the sentencing of Mr. Nadeem, will hopefully give the hard working individuals who were defrauded in this multi-million dollar scheme a feeling that justice has been served. Additionally, this investigation should send a reassuring message to the taxpayers, who ultimately fund School Construction Authority projects, that law enforcement will investigate and prosecute such frauds, as well as send a message of deterrence to anyone contemplating taking advantage of public works projects.”
DOL-OIG Special Agent-in-Charge Mellone stated, “Today’s sentencing underscores the Office of Inspector General’s continued commitment to bring to justice those who would bribe Union officials and falsify payroll records to cheat the American worker out of the required prevailing wage to which they are entitled.”
Nadeem owned and operated SM&B, which received over $36 million in fraud-induced payments from the SCA since 2007. Evidence at trial established that SM&B paid workers, including bricklayers and laborers, cash wages on its projects at rates that were a small fraction of the prevailing wage. The defendant and his co-conspirators Syed and Chaudry then falsely certified to the SCA that the workers had been paid the prevailing wage.
To conceal the scheme, and to obtain cash to pay the illegally low wages to workers, Nadeem, Syed and Muzaffar illegally structured financial transactions, cashing hundreds of checks in amounts less than $10,000 for the purpose of avoiding federal reporting requirements. Since July 2006, Nadeem and others acting his direction wrote more than $4.1 million in structured checks on SM&B’s account.
Nadeem and Syed arranged for the payment of $30,000 in cash bribes to an undercover SCA Inspector, and over $7,000 in cash bribes to Russell Argila, a shop steward for Local 1 of Bricklayers. Argila previously pleaded guilty to accepting those bribes. Nadeem also laundered approximately $7 million in proceeds of the scheme by funneling it through shell companies, and sent millions of dollars through these shell companies to Pakistan to invest in an amusement park and resort complex named “Wayzgoose Park.”
Finally, Nadeem filed false tax returns for SM&B and himself that fraudulently inflated SM&B’s business expenses and reduced its profits by more than $4 million.
The government’s case is being prosecuted by the Office’s Public Integrity Section. Assistant United States Attorneys Lan Nguyen, Gina M. Parlovecchio and Nathan Reilly are in charge of the prosecution. Assistant United States Attorney Claire Kedeshian is handling the forfeiture aspects of the case.
The Defendant:
MUZAFFAR NADEEM
Age: 60
Brooklyn, New YorkE.D.N.Y. Docket No. 13-CR-424 (BMC)
Federal Jury Finds Suffolk County Conservative Party Chairman Edward Walsh Guilty in Scheme to Defraud the Suffolk County Sheriff’s OfficeRead the Press Release
Walsh Falsely Represented that He Worked Regular and Overtime Hours for
the Suffolk County Sheriff’s Office When He Was Playing Golf, Visiting Casinos, or
Performing Work on Behalf of the Suffolk County Conservative PartyLate this afternoon, following three weeks of trial, a federal jury in Central Islip, returned a guilty verdict against Suffolk County Conservative Party Chairman Edward M. Walsh, Jr., on charges that he engaged in a scheme to steal wages for regular and overtime hours in connection with his employment with the Suffolk County Sheriff’s Office (SCSO). The jury convicted the defendant of both counts of an indictment charging him with theft of government funds and wire fraud, in violation of Title 18 U.S.C. §§ 666 and 1343, respectively.
The verdict was announced by Robert L. Capers, United States Attorney for the Eastern District of New York and Diego Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI).
At trial, the government successfully proved that from January 2011 to April 2014, Walsh, a SCSO Correction Officer III Investigator, falsely represented to the SCSO that he had worked certain regular and overtime hours when, in fact, he did not work those hours. Contrary to his representations, the government successfully established that Walsh was, among other things, playing golf, gambling at Foxwoods Casino, or performing work on behalf of the Suffolk County Conservative Party. In reliance on Walsh’s false representations, the SCSO paid Walsh wages for hours he did not work. At trial, investigators estimated that Walsh was paid more than $200,000 for regular and overtime hours he did not work.
“Today’s verdict once again establishes that no one person is above the law. Edward Walsh abused his position and authority as a political boss to steal from taxpayers in order to fund his personal and political activities. Now he will be held accountable for his actions,” stated United States Attorney Capers. “We and our partners in the FBI will continue to root out government corruption and fraud wherever we find it.”
Assistant Director-in-Charge Rodriguez stated, “Defrauding the government never pays as Mr. Walsh found out today with the guilty verdict. Mr. Walsh cheated Suffolk County and ultimately the tax payers for hours never worked. The FBI remains committed to working with our law enforcement partners to root out fraud to the government in any form.”
Upon sentencing the defendant Walsh faces a potential sentence of up to 30 years at the time of sentence.
The government’s case was prosecuted by Assistant United States Attorneys Catherine M. Mirabile and Raymond A. Tierney
The Defendant:
Edward M. Walsh, JR.
Age: 50
East Islip, New YorkE.D.N.Y. Docket No. 15-CR-091(ADS)
FBI, DEA, NYPD and New York State Police Seize over 200 Kilograms of K2 from Narcotics Factory Operating in Queens StorefrontRead the Press Release
A joint raid conducted by the Federal Bureau of Investigation and Drug Enforcement Administration’s New York Drug Enforcement Task Force last night resulted in the discovery of a manufacturing facility and the seizure of at least 200 kilograms of synthetic cannabinoids, commonly sold on the street under the brand names “K2” or “Spice,” from a storefront in Queens, New York. One defendant, Osvaldo Maria Vasquez, was arrested at the site in connection with a previously-issued arrest warrant charging him with participating in a conspiracy to distribute cocaine in 2014 and 2015.
The seizure and arrest were announced by Robert L. Capers, United States Attorney for the Eastern District of New York, Diego G. Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation (FBI), New York Field Office, James J. Hunt, Special Agent-in-Charge, Drug Enforcement Administration (DEA), Commissioner William J. Bratton, New York City Police Department (NYPD) and Joseph A. D’Amico, New York State Police Superintendent.
According to the detention memorandum, a search warrant was executed last night at “Excellent Tire Shop Services,” a business in Queens Village that purported to sell tires. Upon entry into the premises, the agents located approximately 170 kilograms of suspected synthetic cannabinoids already packaged for immediate sale to customers. Concealed behind a tarp in the rear of the premises was a narcotics manufacturing facility, where agents found industrial quantities of the chemicals used to manufacture synthetic cannabinoids, scales, packaging materials, flavoring agents, as well as a large amount of processed cannabinoids that were not yet packaged for sale. In total, at least 200 kilograms of suspected synthetic cannabinoids were seized from the location. Law enforcement estimates this quantity of synthetic cannabinoids to have a street value of at least $200,000.
“Synthetic cannabinoids present a new danger to public health. While sometimes called synthetic marijuana, use of these drugs can have unpredictably severe and even lethal effects,” stated United States Attorney Robert L. Capers. “Last night’s seizure by the FBI and DEA represents another step in law enforcement’s response to this deadly serious problem.”
FBI Assistant Director in Charge Diego Rodriguez said “the production of synthetic drugs creates serious concerns for the law enforcement community and poses a significant public safety risk for consumers of these volatile and potentially deadly substances. As we confront an epidemic in which society is saturated with the dissemination of many illegal substances, we stand with our partners in confronting this emerging challenge."
DEA Special Agent in Charge James J. Hunt said “rearing its ugly head, synthetic cannabinoids were being manufactured and packaged with intentions to be unleashed in our city. Due to good police work, a clandestine K2 lab was dismantled in Queens, demolishing the health and the societal dangers caused by K2 use along with it.”
“This makeshift synthetic cannabinoid lab, which operated out of sight in the rear of a tire shop, was used to produce this poison in the vicinity of several homes and businesses,” said Police Commissioner William J. Bratton. “I commend the work of the Drug Enforcement Task Force and our FBI partners for seizing this drug before it reached the streets of New York.”
Joseph A. D’Amico, New York State Police Superintendent said “the dangers of synthetic narcotics are well documented, with very serious health and public safety issues that have occurred because of the increase in use. With this bust, we have succeeded in taking a large quantity of synthetic drugs off the streets, and shutting down the lab where they were produced. The State Police is committed to working with our law enforcement partners to keep these hazardous substances out of our communities.”
The defendant was arraigned this afternoon before United States Magistrate Judge Cheryl L. Pollak at the federal courthouse in Brooklyn. The charges in the complaint are merely allegations, and the defendant is presumed innocent unless and until proven guilty.
The government’s case is being prosecuted by the Office’s International Narcotics and Money Laundering Section. Assistant United States Attorneys Lauren Howard Elbert and Jennifer Sasso Carapiet are in charge of the prosecution.
The Defendant:
OSVALDO MARIA VASQUEZ
Age: 36
Queens, New YorkE.D.N.Y. Docket No. 16 MJ 256
New York City School Guidance Counselor and Union Representative Pleads Guilty to Transportation of Child PornographyRead the Press Release
Earlier today, John Capuano, a New York City school guidance counselor and teacher’s union representative, pled guilty at the federal courthouse in Central Islip, New York, to Transportation of Child Pornography in Interstate and Foreign Commerce. Today’s plea proceeding took place before United States Magistrate Judge Gary R. Brown. At sentencing, Capuano faces a mandatory minimum sentence of five years in prison and a maximum of 20 years.
The guilty plea was announced by Robert L. Capers, United States Attorney for the Eastern District of New York.
“Protecting the vulnerable, particularly children, is a priority for law enforcement and this Office,” stated United States Attorney Capers. “This crime was particularly egregious in that Capuano was a school guidance counselor entrusted with ensuring the safety and wellbeing of children while he at the same time was victimizing them by distributing images of child pornography.” Mr. Capers thanked the Department of Homeland Security, Homeland Security Investigations (HSI), for its assistance in the investigation.
As set forth in the charging instruments and the defendant’s plea allocution, in April 2015, an undercover HSI agent, as part of an ongoing effort to locate individuals sharing child pornography, found child pornography images and videos involving children as young as 3-5 years’ old which had been posted by Capuano to a chat room in a publicly available Internet application. After tracing location information for the account used to post the images, law enforcement obtained a search warrant and executed on May 28, 2015, at Capuano’s residence in Valley Stream, New York.
During the search, Capuano spoke with law enforcement personnel following a waiver of his Miranda rights and admitted that he used the Internet application to trade child pornography and posted the images located by the undercover agent. Capuano also identified his personal telephone and his work telephone as a teacher’s union representative as devices he used to access these materials. Capuano was arrested and remains incarcerated.
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 handled by the Office’s Long Island Criminal Division. Assistant United States Attorney Allen Bode is in charge of the prosecution.
The Defendant:
John Capuano
Age: 43
Valley Stream, New YorkE.D.N.Y. Docket No. 15 CR 312 (DRH)
Former President of Honduran Soccer Federation Pleads Guilty to Racketeering and Corruption ChargesRead the Press Release
Earlier today in federal court in Brooklyn, New York, Rafael Callejas, the president of the Honduran soccer federation (FENAFUTH) from 2002 to 2015, pleaded guilty to racketeering conspiracy and wire fraud conspiracy in connection with his receipt of bribes in exchange for the awarding of contracts for the media and marketing rights to FIFA World Cup qualifier matches. Callejas, who served as the President of the Republic of Honduras from 1990 to 1994, also agreed to forfeit $650,000. At sentencing, Callejas faces a maximum sentence of 20 years for each count. Today’s plea proceeding took place before U.S. Magistrate Judge Robert M. Levy.
The guilty plea was announced by U.S. Attorney Robert L. Capers for the Eastern District of New York, Assistant Director in Charge Diego G. Rodriguez for FBI’s New York Field Office and Acting Special Agent in Charge Anthony J. Orlando for the Internal Revenue Service-Criminal Investigation’s (IRS-CI) Los Angeles Field Office.
According to court filings and facts presented during the plea proceeding, Callejas negotiated and accepted bribes totaling hundreds of thousands of dollars in exchange for his agreement to exercise his influence as the president of FENAFUTH to award contracts to Media World, a Florida sports marketing company, for the media and marketing rights to the Honduran national soccer team’s home World Cup qualifier matches for the 2014, 2018 and 2022 editions of the World Cup. Over a period of years, Media World transmitted these bribes from its U.S. bank accounts, through an intermediary, to the foreign bank accounts of the defendant and a co-conspirator.
The guilty plea announced today is part of an investigation into corruption in international soccer being 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 Los Angeles Field Office. The prosecutors in Brooklyn are receiving considerable assistance from attorneys in various parts of the Justice Department’s Criminal Division in Washington, D.C., including the Office of International Affairs, the Organized Crime and Gang Section, the Asset Forfeiture and Money Laundering Section and the Fraud Section, as well as from INTERPOL Washington.
Assistant U.S. Attorneys Evan M. Norris, Amanda Hector, Paul Tuchmann, Nadia Shihata, Keith D. Edelman and Brian D. Morris of the Eastern District of New York are in charge of today’s prosecution.
The government’s investigation is ongoing.
Former President of Honduran Soccer Federation Pleads Guilty to Racketeering and Corruption ChargesRead the Press Release
Earlier today in federal court in Brooklyn, Rafael Callejas, the president of the Honduran soccer federation (FENAFUTH) from 2002 to 2015, pleaded guilty to racketeering conspiracy and wire fraud conspiracy in connection with his receipt of bribes in exchange for the awarding of contracts for the media and marketing rights to FIFA World Cup qualifier matches. Callejas, who served as the President of the Republic of Honduras from 1990 to 1994, also agreed to forfeit $650,000. At sentencing, Callejas faces a maximum sentence of 20 years for each count. Today’s plea proceeding took place before United States Magistrate Judge Robert M. Levy.
The guilty plea was announced by Robert L. Capers, United States Attorney for the Eastern District of New York; Diego G. Rodriguez, Assistant Director in Charge, FBI, New York Field Office; and Acting Special Agent in Charge Anthony J. Orlando, IRS Criminal Investigation, Los Angeles Field Office.
According to court filings and facts presented during the plea proceeding, Callejas negotiated and accepted bribes totaling hundreds of thousands of dollars in exchange for his agreement to exercise his influence as the president of FENAFUTH to award contracts to Media World, a Florida sports marketing company, for the media and marketing rights to the Honduran national soccer team’s home World Cup qualifier matches for the 2014, 2018, and 2022 editions of the World Cup. Over a period of years, Media World transmitted these bribes from its U.S. bank accounts, through an intermediary, to the foreign bank accounts of the defendant and a co-conspirator.
The guilty plea announced today is part of an investigation into corruption in international soccer being led by the U.S. Attorney’s Office for the Eastern District of New York, the FBI New York Field Office, and the IRS-CI Los Angeles Field Office. The prosecutors in Brooklyn are receiving considerable assistance from attorneys in various parts of the Justice Department’s Criminal Division in Washington, D.C., including the Office of International Affairs, the Organized Crime and Gang Section, the Asset Forfeiture and Money Laundering Section, and the Fraud Section, as well as from INTERPOL Washington.
Assistant U.S. Attorneys Evan M. Norris, Amanda Hector, Paul Tuchmann, Nadia Shihata, Keith D. Edelman, and Brian D. Morris of the Eastern District of New York are in charge of today’s prosecution.
The government’s investigation is ongoing.
The Defendant:
RAFAEL CALLEJAS
Age: 72
Nationality: HondurasE.D.N.Y. Docket No. 15 CR 252 (S-1)
Malian National Pleads Guilty in Brooklyn Federal Court to Conspiracy to Murder U.S. DiplomatRead the Press Release
Earlier today, Alhassane Ould Mohamed, also known as “Cheibani,” a citizen of Mali, pled guilty at the federal courthouse in Brooklyn, New York, to conspiring to murder a United States diplomat stationed in Niamey, Niger, in December 2000.
The guilty plea was announced by Robert L. Capers, United States Attorney for the Eastern District of New York, and Diego G. Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation.
According to court filings and facts presented during the plea proceeding, in the early morning hours of December 23, 2000, the defendant and a co-conspirator accosted a group of employees of the United States Embassy in Niger as they left a restaurant in Niamey, Niger. Carrying a pistol and an AK-47 assault rifle, the two men approached Department of Defense official William Bultemeier as he was about to enter his car, a white sport-utility vehicle bearing diplomatic license plates clearly indicating that it belonged to the United States Embassy. After demanding that Mr. Bultemeier turn over the keys to the diplomatic vehicle, the defendant and his co-conspirator shot Mr. Bultemeier and Staff Sergeant Christopher McNeely, the Marine Detachment Commander for the United States Embassy in Niger at the time, who had run to Mr. Bultemeier’s aid. The defendant and his fellow assailant then drove away in the United States Embassy vehicle.
Mr. Bultemeier died of the injuries inflicted by the gunshot wounds. Staff Sergeant McNeely survived the shooting, and later retired from the Marine Corps as a Master Sergeant.
Today’s plea took place before United States District Judge William F. Kuntz, II. When sentenced on April 26, 2016, the defendant faces an agreed-upon term of 25 years’ imprisonment.
The government’s case is being prosecuted by the Office’s National Security & Cybercrime Section. Assistant United States Attorneys Zainab Ahmad, Margaret Lee, and Melody Wells are in charge of the prosecution, with assistance provided by Trial Attorney Jennifer Levy of the Justice Department’s Counterterrorism Section.
The Defendant:
ALHASSANE OULD MOHAMED
Age: 46E.D.N.Y. Docket No. 13-527 (WFK)
Defendant Pleads Guilty to Extortion and Firearm ChargesRead the Press Release
Yesterday, at the federal courthouse in Brooklyn, New York, Denis Nikolla pleaded guilty to two counts of Hobbs Act extortion conspiracy, one count of threatening physical violence in furtherance of an extortion plan, and one count of brandishing a firearm. The proceeding took place before United States District Judge Eric N. Vitaliano. When sentenced, Nikolla faces up to life in prison and a mandatory minimum sentence of seven years. One of his co-defendants, Besnik Llakatura, who served as a police officer with the New York City Police Department during the charged crimes, previously pleaded guilty in this case.
The plea was announced by Robert L. Capers, United States Attorney for the Eastern District of New York, Diego Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office, and William J. Bratton, Commissioner, New York Police Department.
According to prior court filings and facts presented during the plea proceeding, between May and November 2013, Nikolla, Llakatura and their co-defendant conspired and attempted to extort a Queens restaurant owner, demanding regular payments in exchange for so-called “protection.” The extortion began shortly after the victim opened a restaurant in Astoria when he was visited by the co-defendant and told that he had opened a business in “our neighborhood” and, as a result, “you have to pay us” $4,000 per month. The restaurant owner sought help from his friend Llakatura. Unbeknownst to him, Llakatura, an NYPD officer in Staten Island since 2006, was conspiring with the co-defendant in the extortion. Llakatura actively discouraged the restaurant owner from going to the police and sought to leverage his position of trust as a friend and a police officer to persuade the victim that he had no choice but to make the demanded payments, warning the victim that the co-defendant and his associates would physically harm him if he did not pay. When the victim resisted, Nikolla threatened him with physical violence and chased him at gunpoint down the street in Queens. Over the course of five months, each of the three defendants took turns collecting monthly payments from the Astoria restaurant owner, ultimately collecting $24,000 in so-called protection money.
Between April 2012 and November 2013, Nikolla and the co-defendant also conspired and attempted to extort the proceeds of two nightclubs located in Queens, New York, and used a firearm in their efforts to do so. In or about April 2012, around the time that one of the clubs was opened, Nikolla approached the owner with an extortion demand, indicating to the victim that other businesses in the area were paying him for so-called “protection.” Nikolla demanded $200 per week from the owner for each of the two nightclubs. After the owner refused to pay, Nikolla retrieved a firearm from the codefendant’s side, stuck the firearm in owner’s ribs, and informed the owner that if he wasn’t paid, Nikolla would come to the owner’s house and beat up the owner in front of the owner’s wife and children.
Finally, during 2013, Nikolla, Llakatura, and the co-defendant also conspired and attempted to extort a proprietor of two social clubs in Astoria. Nikolla, accompanied by the co-defendant, made the initial extortion demand, seeking payments of $1,000 per week from the proprietor for so-called “protection.” The proprietor refused to make the demanded payments and ceased going to his social clubs out of fear for his safety. Court-authorized wiretaps of the defendants’ telephones revealed evidence of Nikolla’s participation in this extortion conspiracy with Llakatura and the co-defendant, and their attempts to locate the victim. In one instance, Nikolla, Llakatura, and the co-defendant threatened, punched, and pulled a gun on a friend of the victim in an effort to make the friend locate the victim. The victim ultimately fled to a foreign country for a period of time to avoid the defendants’ extortionate threats.
Mr. Capers expressed his thanks to members of the Joint Organized Crime Task Force, which includes agents of the FBI and detectives of the NYPD, which led the investigation, as well as the NYPD’s Internal Affairs Division and the FBI’s Public Corruption squad for their cooperation and assistance in the investigation.
The co-defendant is scheduled to commence trial later this month.
The government’s case is being prosecuted by the Office’s Organized Crime and Gangs Section. Assistant United States Attorneys Nadia Shihata and Patrick Hein are in charge of the prosecution.
The Defendant:
DENIS NIKOLLA
Age: 35
Brooklyn, New YorkE.D.N.Y. Docket No. 13-CR-668 (ENV)
Folk Nation Gang Leader Sentenced to Consecutive Terms of Life ImprisonmentRead the Press Release
Earlier today at the federal courthouse in Brooklyn, New York, Yasser Ashburn, the leader of a set of the violent street gang Folk Nation operating primarily in the Crown Heights and East Flatbush neighborhoods of Brooklyn, was sentenced to two consecutive terms of life imprisonment. On November 10, 2015, one of Ashburn’s co-defendants, Jamal Laurent, was sentenced to five consecutive life terms of imprisonment. Prior to that, on November 6, 2015, co-defendant Trevelle Merritt was sentenced to 40 years of imprisonment. On March 18, 2015, all three defendants were convicted, following a jury trial, of racketeering and racketeering conspiracy, including as racketeering acts the murders of Courtney Robinson, Brent Duncan, and Dasta James, and related crimes.
The sentence was announced by Robert L. Capers, United States Attorney for the Eastern District of New York; Diego G. Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation (FBI), New York Field Office; and William J. Bratton, Commissioner, New York City Police Department (NYPD).
Ashburn led a Folk Nation set of 20 to 25 members that operated in the Ebbets Field Houses, a New York City public housing community in the Crown Heights neighborhood of Brooklyn. From approximately 2007 until their arrests in 2011 and 2012, the defendants were responsible for numerous acts of gang-related violence, including homicides, non-fatal shootings, and robberies in Brooklyn and elsewhere in the tri-state area.
The government’s evidence at trial established that, during the early morning hours of April 20, 2008, a fight erupted at a birthday party held in an apartment at the Ebbets Field Houses. After Courtney Robinson entered the fight to protect his nephew who was being beaten by Folk Nation gang members, Ashburn left the melee and retrieved a handgun from the building stairwell where the gang typically stored weapons. Ashburn then returned to the apartment and shot Robinson at point blank range in the back, killing him.
The government’s case is being prosecuted by the Office’s Organized Crime & Gangs Section. Assistant United States Attorneys Darren A. LaVerne, M. Kristin Mace, and Margaret Lee are in charge of the prosecution, assisted by EDNY Investigator Erik Nesbitt.
The Defendant:
YASSER ASHBURN, also known as “Indio” and “supa swerve 6”
Age: 32
Brooklyn, NYE.D.N.Y. Docket No. 11-CR-303 (NGG)
Long Island Attorney Pleads Guilty to Stealing $1.3 Million from His Trust Fund ClientsRead the Press Release
CENTRAL ISLIP, NY – Earlier today, David Bodian, a Long Island attorney, pleaded guilty to wire fraud for stealing more than $1.3 million from a trust fund for which he was the trustee. Pursuant to his plea agreement with the government, Bodian has agreed that he is liable to pay restitution in the amount of $1,393,559 to the Lou Bacon Trust. When sentenced, Bodian faces up to 20 years in prison.
The guilty plea was announced by Robert L. Capers, United States Attorney for the Eastern District of New York, and Philip R. Bartlett, Inspector-in-Charge, United States Postal Inspection Service (USPIS).
According to court filings and facts presented at the plea hearing, in approximately 2000, Bodian was appointed trustee of the Lou Bacon Trust, a trust fund that benefitted a number of individuals and charities. At the time of his appointment, the trust held more than $1 million in total assets. In approximately 2005, Bodian began looting the fund to pay for his personal expenses, including a car, high-end audio equipment, home renovations, and international vacations. From approximately 2005 to 2015, Bodian stole almost the entirety of the trust’s funds, leaving the trust with a mere $10,000 in cash. To perpetuate the scheme, Bodian lied to the beneficiaries of the trust about the amount of money in the accounts. For example, when a beneficiary asked for a copy of a trust bank statement, Bodian borrowed $150,000 from a friend to deposit in the trust’s account to inflate the trust’s assets. After providing a bank statement to the beneficiary that reflected the $150,000 Bodian had borrowed, he transferred the money back to his friend.
Today’s plea took place before United States Magistrate Judge Arlene R. Lindsay at the United States Courthouse in Central Islip, New York. The case has been assigned to United States District Judge Arthur D. Spatt.
The government’s case is being prosecuted by the Office’s Business and Securities Fraud Section. Assistant United States Attorney Tyler Smith is in charge of the prosecution.
* * *
The charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory, and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state, and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions, and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit ww.StopFraud.gov.
The Defendant:
DAVID BODIAN
Age: 58
Dix Hills, New YorkE.D.N.Y. Docket No. 16-CR-091 (ADS)
Con Ed Contractor Pleads Guilty to Bribery and Tax Evasion ChargesRead the Press Release
Earlier today in federal court in Brooklyn, Rodolfo Quiambao, the President and Chief Executive Officer of the engineering and design firm Rudell & Associates, Inc. (Rudell), pleaded guilty to two counts of federal programs bribery in connection with his scheme to pay bribes and kickbacks to supervisors at Consolidated Edison of New York (Con Ed) in exchange for receiving lucrative contracts and other benefits from the public utility services provider. Quiambao also pleaded guilty to two counts of tax evasion. As part of his plea agreement, Quiambao agreed to pay a total of over $5 million in forfeiture and restitution. When sentenced, he faces up to 30 years in prison. Today’s plea proceeding took place before United States District Judge Allyne R. Ross.
The plea was announced by Robert L. Capers, United States Attorney for the Eastern District of New York; Angel M. Melendez, Special Agent-in-Charge, U.S. Immigration and Custom Enforcement (ICE), Homeland Security Investigations (HSI), in New York; Shantelle P. Kitchen, Special Agent-in-Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), New York; and Michael Nestor, Inspector General, The Port Authority of New York and New Jersey, Office of the Inspector General.
According to court filings and facts presented during the plea proceeding, starting in approximately 2000, Quiambao, whose company specializes in electrical design, surreptitiously and regularly gave Con Ed supervisors hundreds of thousands of dollars in cash and checks in exchange for securing work, including lucrative “sole source” contracts, for his company. The defendant also engaged in tax evasion by first concealing and then deducting the bribe payments he paid to the Con Ed supervisors as business deductions on his companies’ tax returns.
Quiambao’s guilty plea is the latest conviction in the government’s investigation of bribery and kickback schemes involving employees and contractors of Con Ed. Since 2008, thirteen Con Ed supervisors and employees and three Con Ed contractors have been convicted.
In announcing the guilty plea, U.S. Attorney Capers extending his grateful appreciation to the participating law enforcement agencies.
The government’s case is being prosecuted by the Office’s Public Integrity Section. Assistant United States Attorneys Lan Nguyen, Tali Farhadian, and Claire S. Kedeshian are in charge of the prosecution.
The Defendant:
RODOLFO QUIAMBAO
Age: 71
Queens, New YorkE.D.N.Y. Docket No. 15-CR-0515
United States Resolves Civil Suit Against Westbury-Based Mortgage LenderRead the Press Release
Robert L. Capers, United States Attorney for the Eastern District of New York, David A. Montoya, Inspector General for the Department of Housing and Urban Development, and Frederick W. Gibson, Acting Inspector General for the Federal Deposit Insurance Corporation today announced the settlement of claims against Continental Mortgage Bankers d/b/a Financial Equities and its president, Walter Stashin, in United States v. Rainy Day Holdings, LLC. et al., Civil Action No. CV-15-5576. The case is pending in federal court in Central Islip before United States District Judge Joseph F. Bianco.
Continental and Stashin participated in a federal program sponsored by the United States Department of Housing and Urban Development (HUD) that allowed the lenders to make mortgage loans that are insured by the Federal Housing Administration (FHA) in the event of default. The complaint alleged that for at least eight loans, Continental and Stashin funneled payments on borrowers’ loans through a purported charitable organization, the Rainy Day Foundation, in order to avoid defaults and delinquencies that could trigger governmental investigation. The funneled payments artificially suppressed Continental’s comparative delinquency and default rates, as compiled and computed by the FHA. In the settlement, Continental and Stashin admitted to making the payments and that the payments altered the company’s delinquency and default rates. Continental and Stashin agreed to pay three hundred thousand dollars ($300,000) in settlement of the United States’ claims.
“The resolution of this matter, including the defendants’ admissions to wrongdoing, both help to restore the integrity of the FHA mortgage insurance program as well as to serve as a warning to others who would abuse federal mortgage programs,” stated United States Attorney Capers. “We will continue to vigorously pursue those who engage in such activity. We thank the HUD Office of the Inspector General, HUD Office of Program Enforcement, and the FDIC Office of the Inspector General for their outstanding work and support in investigating this matter.”
HUD Inspector General Montoya stated, “This settlement brings to a close Continental Mortgage Bankers’ deceptive practices while a participant in the FHA Direct Endorsement Lender Program. Their attempts to profit at the expense of unsuspecting investors and the public posed a risk to our mortgage insurance pool. The HUD Office of Inspector General will continue to work with our partners at the U.S. Attorney’s Office to expose and pursue those who abuse HUD’s programs.”
FDIC Acting Inspector General Gibson said “The FDIC OIG is pleased to have supported the Department of Justice and the Department of Housing and Urban Development in bringing about today’s settlement. By leveraging our resources, we can broaden the government's efforts to pursue damages resulting from misconduct that has harmed the nation's financial institutions and its mortgage markets. The civil penalties imposed today should send a strong message to others that fraudulent practices like those perpetrated by Mr. Stashin and his firm will not be tolerated.”
The United States’ case in this matter is being litigated by Assistant United States Attorneys Edward Newman, John Vagelatos, and Robert Schumacher.
MS-13 Gang Member Pleads Guilty to Double-MurderRead the Press Release
Earlier today, at the federal courthouse in Central Islip, New York, Arnolvin Umanzor Velasquez (aka “Momia” and “Lito”), a member of the Brentwood Locos Salvatruchas (BLS) clique of La Mara Salvatrucha, also known as the MS-13 street gang, pleaded guilty to his involvement in the December 18, 2011 execution-style murders of two brothers, Ricardo and Enston Ceron. After committing the murders, Velasquez fled to El Salvador, and he later relocated to Georgia. On May 19, 2015, he was found and arrested in Flowery Branch, Georgia, by a Federal Bureau of Investigation SWAT team and later transferred to the Eastern District of New York in custody.
The plea was announced by Robert L. Capers, United States Attorney for the Eastern District of New York, Diego Rodriguez, Assistant Director-in-Charge, FBI, New York Field Office, and Timothy Sini, Commissioner, Suffolk County Police Department.
“The Ceron brothers’ murders are another example of the senseless violence unleashed by the MS-13 on our communities, including the gang’s own members who violate the gang’s rules. One brother was executed because he was trying to distance himself from the MS-13, and the other was killed, merely because of his relationship with the other victim,” stated United States Attorney Capers. “As a result of the tenacious investigation by this Office and our partners with the FBI’s Long Island Gang Task Force, Velasquez and other MS-13 gang members who commit callous acts of violence will be held accountable and face justice.”
“The violence that often erupts between mutual and rival gang members not only affects the criminals involved in this insidious behavior, but innocent people living in the neighborhoods in which they operate. The murders of Ricardo and Enston Ceron signify the unfortunate reality that gangs are responsible for a significant percentage of violent crime in many jurisdictions. We’re dedicated to disrupting and dismantling gangs that pose a threat to the safety and stability of our communities and undermine the values we strive to uphold,” stated Assistant Director-in-Charge Rodriguez.
“Gang violence in Suffolk County threatens the very fabric of our communities, and we must do everything we can to disrupt gangs such as MS-13. Today’s conviction sends a clear message that we will not tolerate gangs and the senseless violence they cause. That is why the Suffolk County Police Department is committed to working with all of our law enforcement partners—particularly the United States Attorney’s Office and the FBI—to make Suffolk County an even safer County than it is already,” stated Commissioner Sini.
As set forth in prior court filings, a detention letter, and the defendant’s statements during his guilty plea, the BLS clique killed Enston Ceron because he was not attending meetings or “putting in work” for the gang, and the clique member were concerned that he might cooperate with law enforcement authorities if he were arrested. The BLS clique also murdered his brother, Ricardo Ceron, who belonged to the Western clique of the MS-13, because they were concerned he would retaliate if he learned that the BLS killed his brother. On December 18, 2011, Velasquez and Sergio Cerna (“Taz”), who had agreed to carry out the murders and were armed with .22 caliber and 9mm semi-automatic handguns, asked Enston and Ricardo Ceron for a ride home from a party. When the car stopped in the vicinity of Lincoln Avenue and Stockton Streets in Brentwood, Velasquez and Cerna executed the Ceron brothers, shooting them in the head and torso at close range. Velasquez and Cerna exited the car and when another vehicle approached the murder scene and stopped, Cerna fired multiple shots at the driver, striking him once in the chest. The driver survived the shooting.
Today’s conviction is the latest in a series of federal prosecutions by the United States Attorney’s Office for the Eastern District of New York targeting members of the MS-13, a violent international 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 largest and 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 this district. A majority of those MS-13 members have been convicted on federal racketeering charges for participating in murders, attempted murders, and assaults. Since 2010 alone, this Office has obtained indictments charging MS-13 members with carrying out more than 30 murders, 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, Nassau County Police Department, Nassau County Sheriff’s Department, Suffolk County Probation, Suffolk County Sheriff’s Department, Rockville Centre Police Department, and Suffolk County Police Department.
Velasquez faces a maximum sentence of life in prison when sentenced by United States District Judge Joseph F. Bianco on June 23, 2016. The charges in the superseding indictment against the other defendants remain pending and are merely allegations. Those defendants are presumed innocent unless and until proven guilty.
The government’s case is being prosecuted by the Office’s Long Island Criminal Division. Assistant United States Attorneys John J. Durham, Raymond A. Tierney, and Paul G. Scotti are in charge of the prosecution.
The Defendant:
ARNOLVIN UMANZOR VELASQUEZ (“Momia” and “Lito”)
Age: 23
Brentwood, New York and Flowery Branch, GeorgiaE.D.N.Y. Docket No. 15-CR-087 (S-2)(JFB)
Sixteen Latin King Gang Members and Associates Arrested for Narcotics Trafficking in Long Beach, New YorkRead the Press Release
A four-count indictment was unsealed today in United States District Court for the Eastern District of New York charging sixteen defendants with four narcotics trafficking conspiracies, including conspiracies to possess with intent to distribute cocaine, cocaine base (crack cocaine), ethylone (molly), and marijuana. The defendants are scheduled to be arraigned this afternoon before United States Magistrate Judge Anne Y. Shields at the federal courthouse in Central Islip.
The charges were announced by Robert L. Capers, United States Attorney for the Eastern District of New York; Diego Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); James J. Hunt, Special Agent-in-Charge, Drug Enforcement Administration (DEA); and Michael Tangney, Commissioner, Long Beach Police Department (LBPD).
“This indictment should serve as notice to all gang members - we will not tolerate the flooding of our streets with illegal drugs. We are committed to rooting out all drug trafficking and gang activity on Long Island,” stated United States Attorney Capers. Mr. Capers thanked the FBI, DEA Long Island Drug Task Force and LBPD for their assistance with the government’s investigation.
“Today, 16 members and associates of the Latin Kings Gang are facing charges related to drug trafficking in parts of Long Island. When criminal operatives and gangs bring in illegal drugs into our neighborhoods, they also bring violence, turf wars and other criminal activity. The FBI will continue to work with our law enforcement partners to dismantle gang activity and keep our communities safe,” said FBI Assistant Director-in-Charge Diego Rodriguez.
DEA Special Agent-in-Charge Hunt stated, “Today’s arrests have dismantled an alleged drug gang that preyed upon the Long Beach community. The indictment charges that this organization illegally distributed cocaine, crack cocaine, ethylone and marijuana; all of which furthered crime, addiction, and violence. Law enforcement worked collaboratively to reclaim this neighborhood for the law abiding citizens who deserve to live without intimidation, fear, and drug trafficking.”
LBPD Commissioner Tangney stated, “The Long Beach Police Department is very appreciative of the assistance the FBI and DEA provided to the LBPD in this joint operation. Removing these dangerous individuals from our streets makes this community that much safer. This joint investigation was very successful and demonstrates that when federal and local law enforcement work together, great results are achieved.”
As alleged in the government’s detention memorandum, the indictment is the product of a two-year investigation during which law enforcement identified the most prolific narcotics traffickers in the Long Beach area, including numerous members and associates of the Latin Kings street gang. Court-authorization was then obtained to intercept telephone communications between the defendants, all of whom were intercepted on multiple occasions engaging in narcotics trafficking activities. The charged conspiracies involved over 50 kilograms of cocaine, five kilograms of crack cocaine, two kilograms of molly, and 500 pounds of marijuana.
If convicted of the charges in the indictment, Amparo, A. Andujar, R. Andujar, Cerda, Cobb, Curry, Diggs, Fernandez, Ojedis, Ramirez, and Rupay face a maximum of life imprisonment. Ayala, Collins, Vanroten, and Wilson face a maximum of 40 years’ imprisonment, and Labella faces a maximum of 20 years’ imprisonment. The charges contained in the indictment are merely allegations, and the defendants are presumed innocent unless and until proven guilty.
The government’s case is being prosecuted by the office’s Long Island Criminal Division. Assistant United States Attorneys Lara Treinis Gatz, Mark E. Misorek, and Grace M. Cucchissi are in charge of the prosecution.
The Defendants:
Jose Giovanny Amparo
Age: 46
Bronx, New YorkAmanda Andujar
Age: 26
Baldwin, New YorkRoxanne Andujar
Age: 36
Baldwin, New YorkJordan Ayala
Age: 20
Long Beach, New YorkFernando Cerda
Age: 38
Long Beach, New YorkTysaun Cobb
Age: 24
Hempstead, New YorkArthur Collins
Age: 38
Island Park, New YorkTravis Curry
Age: 37
Long Beach, New YorkSean Diggs
Age: 28
Long Beach, New YorkNelson Fernandez
Age: 35
Long Beach, New YorkFrank Labella
Age: 35
Oceanside, New YorkDaniel Ojedis
Age: 37
Baldwin, New YorkAnthony Ramirez
Age: 29
Hempstead, New YorkRonald Rupay
Age: 35
Long Beach, New YorkGregory Vanroten
Age: 38
Baldwin, New YorkSly Wilson
Age: 30
Long Beach, New YorkFugitive Captured After Shootout with U.S. Marshals and New York City Detectives Convicted of Assault with A Deadly Weapon and Related Firearms OffensesRead the Press Release
Late this afternoon, following four days of trial, a federal jury in Brooklyn, New York, returned a guilty verdict against Oswald Lewis, on charges of assault of federal agents and New York City Detectives by use of a deadly weapon and related firearms offenses. Lewis, also known as “Alexander Louis,” “Junior,” “Andrew Jackson,” “Andre Bernard Jackson,” “John Green,” “Leslie Howard” and “Dre,” faces a maximum sentence of life imprisonment when sentenced on June 23, 2016, by United States District Judge I. Leo Glasser.
The verdict was announced by Robert L. Capers, United States Attorney for the Eastern District of New York; Charles G. Dunne, United States Marshal for the Eastern District of New York; William J. Bratton, Commissioner, New York City Police Department; and Delano A. Reid, Special Agent-in-Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives, New York Field Division.
Lewis had been wanted since 1991 on numerous drug charges filed in the United States District Court for the Eastern District of Virginia. On August 26, 2014, the U.S. Marshals Service located Lewis in an apartment in the Springfield Gardens section of Queens, New York. Later that evening, Deputy U.S. Marshals and New York City Police Department Detectives went to the apartment to arrest him. When the Deputies entered the apartment, Lewis, who was wearing body armor, yelled that he was holding a hostage and began shooting, barely missing at least one Deputy by mere inches. During the shooting spree, Lewis fired shots out his apartment window at members of the NYPD, who had surrounded the premises. During the exchange of gunfire, Lewis was shot in the arm. He eventually surrendered and was taken into custody. No law enforcement officers were injured.
“These dedicated Deputy U.S. Marshals and NYPD Detectives put their lives on the line every day to protect us from violent criminals such as the defendant Oswald Lewis. His life on the run ended today, and our community is safer for it,” stated Unites States Attorney Capers.”
“Today, US Marshals around the country paused for a moment of silence to remember Deputy US Marshal Josie Wells who was shot and killed by an armed fugitive while serving a warrant in Louisiana one year ago today. The circumstances of the two incidents are similar – a violent fugitive armed with an illegal handgun shooting at law enforcement officers who came to bring him to justice. We are very fortunate that the arrest in New York ended with only minor injuries to Mr. Lewis and no injuries to the law enforcement officers involved. The US Marshals would like to thank the United States Attorney’s Office for the Eastern District of New York for prosecuting Mr. Lewis, and we would like to thank the New York City Police Department for their continued partnership as we work together to keep New York City safe,” stated United States Marshal Dunne.
“ATF Special Agent in Charge Reid stated, “With today’s swift verdict, the defendant will now begin to realize that law enforcement and the criminal justice system remain vigilant and relentless in their pursuit of those who decide to run from their crimes. Finally, Mr. Lewis will face the punishment he has successfully avoided for so many years and hopefully will learn that fugitives - especially those that decide to shoot at law enforcement instead of surrendering - have but one place in society: a jail cell.”
The government’s case is being prosecuted by Special Assistant United States Attorney Jonathan P. Lax.
The Defendant:
OSWALD LEWIS
Age: 44
Queens, New YorkE.D.N.Y. Docket No. 14-CR-523 (ILG)
Former CEO of Long Island’s Synergy Brands, Inc. Sentenced to 63 Months in Prison for Operating A Massive Check Kiting SchemeRead the Press Release
Earlier today in Brooklyn federal court, Mair Faibish, the former Chief Executive Officer of Synergy Brands, Inc. (Synergy), was sentenced to 63 months’ imprisonment for his role in defrauding Signature Bank out of $26 million through a massive check kiting scheme, making false statements to the United States Securities and Exchange Commission (SEC), and defrauding investors by overstating the value of the company. The sentencing proceeding was held before U.S. District Judge Eric N. Vitaliano. Faibish was convicted after a three-week jury trial in March 2014.
The sentence was announced by Robert L. Capers, United States Attorney for the Eastern District of New York.
“The defendant played fast and loose with the truth and with federally insured money, kiting checks back and forth across the Canadian border to defraud auditors, banks, and investors. His actions have now landed him in federal prison,” stated United States Attorney Capers. “We will aggressively investigate and prosecute those who exploit investors and banks.” Mr. Capers extended his grateful appreciation to U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI), which led the government’s criminal investigation, and the Nassau County Police Department.
Synergy was a publicly-held food products company that traded on the NASDAQ and Over-the-Counter exchanges and manufactured and distributed various food products. As proven at trial, Faibish and his co-conspirators, on behalf of Synergy, funneled approximately $1.3 billion in checks that were not backed by sufficient funds through Signature Bank, Capital One Bank, and various Canadian bank accounts of associated food manufacturers and distributors in Canada. The Canadian companies then sent checks in corresponding amounts, which were also not backed by sufficient funds, back to Faibish-controlled shell companies. Because the banks made deposited funds immediately available for withdrawal, the scheme artificially inflated the companies’ account balances. Faibish and his co-conspirators used Synergy’s inflated bank account balances to book millions of dollars in fictitious accounts receivable and revenue.
As a result of this fraud, FDIC-insured Signature Bank lost approximately $26 million that Faibish and his co-conspirators had withdrawn before the bank uncovered the scheme. Following the scheme’s collapse, Synergy was taken into bankruptcy, and its publicly traded stock became essentially worthless, causing millions of dollars in investor losses. On November 4, 2014, the Court ordered Faibish to pay $51,166,000 in forfeiture.
The trial evidence also established that Faibish falsely inflated the values of Synergy’s sales, cost of goods sold, and pre-paid expenses in filings with the SEC for the quarter ending June 30, 2008. These material misrepresentations were breaches of the defendant’s fiduciary duties to investors.
This prosecution was the result of efforts by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ Offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state, and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions, and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, visit http://www.StopFraud.gov.
The government’s case is being prosecuted by the office’s Business and Securities Fraud Section. Assistant United States Attorneys Sylvia S. Shweder and Jack Dennehy are in charge of the prosecution. Assistant U.S. Attorney Brian D. Morris of the Office’s Civil Division is responsible for the forfeiture of assets.
The Defendant:
MAIR FAIBISH
Age: 55
Residence: Huntington Station, New YorkE.D.N.Y. Docket No. 12-CR-265 (ENV)
United States Settles Claim Against Surgeon Who Refused to Operate on an HIV- Positive PatientRead the Press Release
Robert L. Capers, United States Attorney for the Eastern District of New York, announced today a settlement with Dr. William Sher, an otolaryngologist in Port Jefferson, New York, under title III of the Americans With Disabilities Act, 42 U.S.C. § 12181- 12189 (ADA). Title III prohibits discrimination against people with disabilities in places of public accommodation such as hospitals. Individuals with HIV fall within the protection of the ADA.
The settlement resolves claims made by J.P.[1], who is HIV positive, that Dr. Sher refused to operate on him after Dr. Sher learned that J.P. was HIV positive. J.P. alleged that Dr. Sher was scheduled to perform a biopsy on a growth on his neck but cancelled minutes before the procedure was to begin, citing J.P.’s HIV status. Approximately three weeks later, another physician performed the biopsy on the growth, which turned out to be cancerous.
Under the settlement, Dr. Sher will pay $75,000 to J.P. and attend training on title III of the ADA, including training about HIV/AIDS and discrimination. Under the terms of the settlement, Dr. Sher does not admit to violating J.P.’s rights under the ADA.
“Discrimination against individuals with HIV is not permissible,” stated United States Attorney Capers. “The ADA requires that doctors and other health care professionals provide appropriate care and treatment to patients without regard to their HIV status. The settlement makes clear that this office will vigorously enforce the ADA against those who seek to discriminate against patients who fall under its protection.”
The matter was handled by Assistant U.S. Attorneys Jolie Apicella and Michael Goldberger.
[1] J. P. has asked that his identity remain confidential.
Jury Finds Air Force Veteran Guilty in First Conviction After Trial in the United States for Attempting to Travel Overseas to Join ISILRead the Press Release
Former U.S. Air Force Airplane Mechanic Convicted of Attempting to Provide Material Support to Terrorists and Obstruction of an Official Proceeding
A jury in the Eastern District of New York today found Tairod Nathan Webster Pugh, 48, of Neptune, New Jersey, a veteran of the U.S. Air Force, guilty of attempting to provide material support to the Islamic State of Iraq and the Levant (ISIL), a designated foreign terrorist organization, and obstructing an official proceeding.
The verdict was announced by Assistant Attorney General for National Security John P. Carlin, U.S. Attorney Robert L. Capers of the Eastern District of New York, Assistant Director in Charge Diego Rodriguez of the FBI’s New York Field Office and Commissioner William J. Bratton of the New York City Police Department.
“Pugh, an American citizen and former member of the U.S. Air Force where he served as an aircraft mechanic, attempted to travel to Syria to provide material support to ISIL,” said Assistant Attorney General Carlin. “This is the first conviction after a trial by jury in the United States involving an individual who attempted to travel to Syria to join ISIL, and further demonstrates our commitment to bring to justice all those who seek to provide material support to terrorists. I would like to thank all the members of law enforcement whose tireless efforts made this result possible.”
“Today’s verdict provides yet another example of a successful outcome in our national security effort, and demonstrates the crucial role that law enforcement action plays in that effort,” said U.S. Attorney Capers. “The evidence presented at trial and the jury’s verdict instill confidence that our law enforcement agencies and their many important partners at home and abroad work effectively to disrupt and defeat the deadly siren’s call of terrorist groups around the globe. Pugh has now been held accountable for his crimes by a jury and will not reach the terrorist group he sought to support.”
“As presented in trial, Tairod Nathan Webster Pugh was willing to become a martyr, using his U.S. military training as a weapon for ISIL,” said Assistant Director in Charge Rodriguez. “Instead, found guilty of his crimes, he is facing a lengthy incarceration. We are pleased the jury found his actions confirmed his expressed desire to cause violence and destruction on behalf of this terrorist organization. The FBI’s Joint Terrorism Task Forces continue to work globally with our partners to successfully stop such actions before they happen, keep communities safe and bring criminals to justice.”
“We applaud today’s verdict, finding the first ISIL defendant guilty after attempting to travel to Syria and wage jihad," said Commissioner Bratton. "Those who adhere to ISIL’s deadly terrorist agenda should be on notice: reject this ideology or face swift justice in American courts. It is fitting that the first ISIL conviction case is here in the Eastern District of New York, which has prosecuted more terrorism cases than any other district in the country. It is to them — and the many others on the Joint Terrorism Task Force — that New Yorkers owe their gratitude for the relentless efforts to keep our city safe.”
At trial, the government presented evidence that prior to traveling overseas to try to join ISIL, Pugh served in the Air Force as an avionics instrument system specialist and received training in the installation and maintenance of aircraft engines, navigation and weapons systems. After leaving the Air Force, the defendant worked for a number of companies in the United States and Middle East as an airplane mechanic. Pugh lived abroad for over a year before his arrest in this case.
On Jan. 10, 2015, the defendant traveled from Egypt to Turkey in an effort to cross the border into Syria to join ISIL to engage in violent “jihad.” However, Turkish authorities denied the defendant entry and returned him to Egypt. At the time of his detention, Pugh was carrying a laptop computer and four USB thumb drives that he had stripped of their plastic casings in an effort to destroy their contents and thereby make them unavailable to investigators. The defendant also was carrying solar power chargers, compasses and a black ski mask. Foreign government officials deported the defendant to the United States, where the FBI closely monitored him, relying in part on a covert undercover employee who encountered the defendant at John F. Kennedy Airport in New York. The defendant was arrested on Jan. 16, 2015, in Asbury Park, New Jersey, and thereafter indicted in the Eastern District of New York.
At trial, the government presented evidence obtained from the defendant’s laptop computer and social media posts. The defendant’s laptop contained Internet searches for “borders controlled by Islamic state.” The government also introduced evidence of the defendant’s Internet searches for “Flames of War” (an ISIL propaganda video) as well as terrorist videos he had downloaded, including one horrific video showing ISIL members executing prisoners. In addition, statements to coworkers and social media posts established Pugh’s empathy and support for ISIL’s cause and terrorist methods.
At trial, the government also introduced a letter drafted by Pugh on Jan. 5, 2015, shortly before he left Egypt for Turkey on his way to Syria. In that letter, the defendant proclaimed, “I am a Mujahid. I am a sword against the oppressor and a shield for the oppressed. I will use the talents and skills given to me by Allah to establish and defend the Islamic State. There is only 2 possible outcomes for me. Victory or Martyr.”
Based on his trial convictions, the defendant faces a maximum sentence of up to 35 years in prison. Sentencing has not yet been scheduled, but is expected to occur later this year.
Assistant Attorney General Carlin joined U.S. Attorney Capers in extending his grateful appreciation to the FBI’s Joint Terrorism Task Force (JTTF), as well as to the U.S. Department of State, U.S. Customs and Border Protection, the U.S. Attorney’s Office of the District of New Jersey, the Asbury Park Police Department and the Neptune Police Department.
The government’s case is being prosecuted by Assistant U.S. Attorneys Samuel P. Nitze, Tiana A. Demas and Mark Bini of the Eastern District of New York, with assistance provided by Trial Attorney Larry Schneider of the National Security Division’s Counterterrorism Section.
Jury Finds Air Force Veteran Guilty in First ISIL Conviction After Trial in the United StatesRead the Press Release
Today, a jury in Brooklyn returned a verdict finding defendant Tairod Nathan Webster Pugh, an American citizen and veteran of the United States Air Force, guilty of attempting to provide material support to the Islamic State of Iraq and the Levant (ISIL), a foreign terrorist organization, and obstruction of an official proceeding. The defendant will be sentenced on September 16, 2016, by Judge Nicholas G. Garaufis at the U.S. Courthouse, 225 Cadman Plaza East, Brooklyn, New York.
The verdict was announced by Robert L. Capers, United States Attorney for the Eastern District of New York; John P. Carlin, Assistant Attorney General for National Security; Diego G. Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office; and William J. Bratton, Commissioner, New York City Police Department.
“Today’s verdict provides yet another example of a successful outcome in our national security effort, and demonstrates the crucial role that law enforcement action plays in that effort,” stated U.S. Attorney Capers. “The evidence presented at trial and the jury’s verdict instill confidence that our law enforcement agencies and their many important partners at home and abroad work effectively to disrupt and defeat the deadly siren’s call of terrorist groups around the globe. Pugh has now been held accountable for his crimes by a jury and will not reach the terrorist group he sought to support.” Mr. Capers extended his grateful appreciation to the FBI’s Joint Terrorism Task Force (JTTF), which comprises a large number of federal, state, and local agencies from the region. Mr. Capers also thanked the U.S. Department of State, U.S. Customs and Border Protection, the United States Attorney’s Office for the District of New Jersey, the Asbury Park, New Jersey Police Department, and the Neptune, New Jersey Police Department for their assistance. Mr. Capers expressed his appreciation to the U.S. Marshals Service and the Federal Protective Service for providing security during the trial.
“Pugh, an American citizen and former member of the U.S. Air Force where he served as an aircraft mechanic, attempted to travel to Syria to provide material support to ISIL,” said Assistant Attorney General Carlin. “This is the first conviction after a trial by jury in the United States involving an individual who attempted to travel to Syria to join ISIL, and further demonstrates our commitment to bring to justice all those who seek to provide material support to terrorists. I would like to thank all the members of law enforcement whose tireless efforts made this result possible.”
“As presented in trial, Tairod Nathan Webster Pugh was willing to become a martyr, using his U.S. military training as a weapon for ISIL. Instead, found guilty of his crimes, he is facing a lengthy incarceration. We are pleased the jury found his actions confirmed his expressed desire to cause violence and destruction on behalf of this terrorist organization. The FBI’s Joint Terrorism Task Forces continue to work globally with our partners to successfully stop such actions before they happen, keep communities safe, and bring criminals to justice,” stated FBI Assistant Director-in-Charge Rodriguez.
“We applaud today’s verdict, finding the first ISIL defendant guilty after attempting to travel to Syria and wage jihad. Those who adhere to ISIL’s deadly terrorist agenda should be on notice: reject this ideology or face swift justice in American courts. It is fitting that the first ISIL conviction case is here in the Eastern District of New York, which has prosecuted more terrorism cases than any other district in the country. It is to them—and the many others on the Joint Terrorism Task Force—that New Yorkers owe their gratitude for the relentless efforts to keep our city safe,” said Police Commissioner Bratton.
At trial, the government presented evidence that, prior to traveling overseas to try to join ISIL, the defendant served in the U.S. Air Force as an avionics instrument system specialist and received training in the installation and maintenance of aircraft engines, navigation, and weapons systems. After leaving the Air Force, the defendant worked for a number of companies in the United States and Middle East as an airplane mechanic. The defendant lived abroad for over a year before his arrest in this case.
On January 10, 2015, the defendant traveled from Egypt to Turkey in an effort to cross the border into Syria to join ISIL to engage in violent “jihad.” Turkish authorities denied the defendant entry, however, and returned him to Egypt. At the time of his detention, the defendant was carrying a laptop computer and four USB thumb drives that he had stripped of their plastic casings in an effort to destroy their contents and thereby make them unavailable to investigators. The defendant also was carrying solar power chargers, compasses, and a black ski mask. Foreign government officials quickly deported the defendant to the United States, where the FBI closely monitored him, relying in part on a covert undercover employee who encountered the defendant at John F. Kennedy airport. The defendant was arrested on January 16, 2015, in Asbury Park, New Jersey, and thereafter indicted in the Eastern District of New York.
At trial, the government presented evidence obtained from the defendant’s laptop computer and social media posts, among other exhibits. The defendant’s laptop contained Internet searches for “borders controlled by Islamic state.” The government also introduced evidence of the defendant’s Internet searches for “Flames of War” (an ISIL propaganda video) as well as terrorist videos he had downloaded, including one horrific video showing ISIL members executing prisoners. In addition, statements to coworkers and social media posts established the defendant’s empathy and support for ISIL’s cause and terrorist methods.
The government also introduced into evidence at trial a letter, drafted by the defendant on January 5, 2015, shortly before he left Egypt for Turkey on his way to Syria. In that letter, the defendant proclaimed, “I am a Mujahid. I am a sword against the oppressor and a shield for the oppressed. I will use the talents and skills given to me by Allah to establish and defend the Islamic State. There is only 2 possible outcomes for me. Victory or Martyr.”
Based on his trial convictions, the defendant faces a maximum sentence of up to 35 years in prison.
The government’s case is being handled by the Office’s National Security & Cybercrime Section. Assistant United States Attorneys Samuel P. Nitze, Tiana A. Demas, and Mark Bini are in charge of the prosecution, with assistance provided by Trial Attorney Larry Schneider of the Counterterrorism Section of the Department of Justice.
The Defendant:
TAIROD NATHAN WEBSTER PUGH
Age: 48
Neptune, New JerseyE.D.N.Y. Docket Nos. 15-CR-116 (NGG)
FIFA Match Agent Pleads Guilty to Corruption ChargesRead the Press Release
Earlier today in federal court in Brooklyn, Miguel Trujillo, a FIFA match agent and soccer consultant, pleaded guilty to one count of money laundering conspiracy and two counts of wire fraud conspiracy in connection with his participation in multiple schemes to bribe soccer officials. Trujillo also pleaded guilty to one count of filing a false tax return under penalty of perjury and agreed to forfeit $495,000. Today’s plea proceeding took place before United States District Judge Raymond J. Dearie.
The guilty plea was announced by Robert L. Capers, United States Attorney for the Eastern District of New York; Diego G. Rodriguez, Assistant Director-in-Charge, FBI, New York Field Office; and Acting Special Agent in Charge Anthony J. Orlando, IRS Criminal Investigation, Los Angeles Field Office.
As alleged in the criminal information to which he pleaded guilty, Trujillo, a citizen of Colombia and a U.S. legal permanent resident, was a Florida-based soccer consultant and a match agent licensed by FIFA to negotiate and arrange soccer matches between FIFA member associations. Starting in approximately 2008 and acting variously on behalf of multiple sports marketing companies and his own soccer business, Trujillo paid hundreds of thousands of dollars in bribes to high-ranking officials of FIFA, CONCACAF, and four soccer federations in Central America and the Caribbean in furtherance of multiple schemes involving media and marketing contracts and international friendly matches.
The guilty plea announced today is part of an investigation into corruption in international soccer being led by the U.S. Attorney’s Office for the Eastern District of New York, the FBI New York Field Office, and the IRS-CI Los Angeles Field Office. The prosecutors in Brooklyn are receiving considerable assistance from attorneys in various parts of the Justice Department’s Criminal Division in Washington, D.C., including the Office of International Affairs, the Organized Crime and Gang Section, the Asset Forfeiture and Money Laundering Section, and the Fraud Section, as well as from INTERPOL Washington.
Assistant U.S. Attorneys Evan M. Norris, Amanda Hector, Paul Tuchmann, Nadia Shihata, Keith D. Edelman, and Brian D. Morris of the Eastern District of New York are in charge of today’s prosecution.
The government’s investigation is ongoing.
The Defendant:
MIGUEL TRUJILLO
Age: 65
Nationality: ColombiaE.D.N.Y. Docket No. 16 CR 108
Leader of Global Cybercrime Campaigns Pleads Guilty to Computer Intrusion and Access Device Fraud ConspiraciesRead the Press Release
Earlier today, Ercan Findikoglu, a Turkish citizen also known by the online nicknames “Segate,” “Predator,” and “Oreon,” pleaded guilty to computer intrusion conspiracy, access device fraud conspiracy, and effecting transactions with unauthorized access devices for his leadership role in organizing and carrying out three cyberattacks between 2011 and 2013 that inflicted more than $55 million in losses in a matter of hours on the global financial system. Today’s guilty plea took place before United States District Court Judge Kiyo A. Matsumoto. At sentencing Findikoglu faces 57.5 years of imprisonment.
The guilty plea was announced by Robert L. Capers, United States Attorney for the Eastern District of New York, and David E. Beach, Special Agent in Charge, United States Secret Service, New York Field Office.
“By hacking into the computer networks of global financial institutions, the defendant and his co-conspirators were able to wreak havoc with the worldwide financial system by simultaneously withdrawing tens of millions of dollars. Today’s guilty plea by a leader of these massive cyberattacks demonstrates this office’s commitment to pursue those who use the perceived safety and anonymity of their computers to steal from innocent victims,” stated United States Attorney Capers. Mr. Capers praised the extraordinary efforts of the Secret Service in investigating these complex network intrusions.
“The Secret Service is pleased to have participated in this criminal investigation. This case demonstrates by constricting this criminal enterprise, there is no such thing as anonymity in the cyber world. The Secret Service’s New York Electronic Crimes Task Force continues to seek new and innovative ways to combat emerging cyber threats. Our success in this case and other similar investigations is a result of our close work with our network of international law enforcement partners,” said Secret Service Special Agent in Charge Beach.
Findikoglu’s organization used sophisticated intrusion techniques to hack into the systems of credit and debit card processing companies, stole data for prepaid debit cards, and eliminated withdrawal limits for those debit cards. During these cyber-attacks, Findikoglu and other co-conspirators manipulated network administrator privileges at the victim card processing companies and stole the personal identification numbers (PINs) associated with the compromised debit cards. Findikoglu and his co-conspirators then disseminated the stolen card data worldwide to the leaders of cashing crews and directed that their teams use the information to make fraudulent ATM withdrawals on a massive scale across the globe. As a result of the effective elimination of withdrawal limits, these cyber-attacks were known as “unlimited operations.”
In one operation on February 27 and 28, 2011, Findikoglu’s cashing crews withdrew approximately $10 million through approximately 15,000 fraudulent ATM withdrawals in at least 18 countries. In a second operation on December 22, 2012, Findikoglu’s cashing crews withdrew approximately $5 million through more than 4,500 ATM in approximately 20 countries. In a third operation on February 19 and 20, 2013, Findikoglu’s cashing crews in 24 countries executed approximately 36,000 transactions and withdrew approximately $40 million from ATMs. During this third operation, in New York City alone, the crews withdrew approximately $2.4 million in nearly 3,000 ATM withdrawals over the course of less than 11 hours.
Findikoglu was paid a significant portion of the illegal proceeds from these unlimited operations.
Today’s guilty plea is the latest in a string of convictions of dozens of other members of the cybercrime organization, including members of a New York City cell charged in May 2013 in connection with their roles in two of the attacks. See United States v. Collado, et al., 13 CR 259 (KAM).
The government’s case is being handled by the Office’s National Security & Cybercrime Section. Assistant United States Attorneys Hilary Jager, Douglas M. Pravda, Richard M. Tucker, and Saritha Komatireddy are in charge of the prosecution. Assistant United States Attorney Brian Morris of the Office’s Civil Division is responsible for the forfeiture of assets.
The Defendant:
ERCAN FINDIKOGLU
Aliases: Segate, Predator, Oreon
Age: 34
Nationality: TurkishE.D.N.Y. Docket No. 13-CR-440 (KAM)
Chief Executive Officer of International Metallurgical Company Arrested for Exporting Aerospace-Grade Metals to IranRead the Press Release
Defendant Exported High-Tech Material Used in Missile Production and Nuclear Applications
Earlier today Erdal Kuyumcu, 44, of Woodside, New York, was arrested on charges of illegally exporting a cobalt-nickel metallic powder from the United States to Iran, through an intermediary in Turkey. Kuyumcu will make his initial appearance this afternoon before U.S. Magistrate Judge Ramon E. Reyes Jr. of the Eastern District of New York.
The arrest and charges were announced by Assistant Attorney General for National Security John P. Carlin, U.S. Attorney Robert L. Capers of the Eastern District of New York, Assistant Director in Charge Diego Rodriguez of the FBI’s New York Field Office and Special Agent in Charge Jonathan Carson of the U.S. Department of Commerce’s Bureau of Industry and Security, Office of Export Enforcement’s New York Field Office.
The complaint alleges that Kuyumcu, a U.S. citizen and the CEO of Global Metallurgy LLC, twice exported a specialized metallic powder used in aerospace, missile production and nuclear applications. Exporting this specialized powder to Iran without a license from the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) is illegal. As detailed in the complaint, Kuyumcu and others conspired to obtain over a thousand pounds of the metallic powder from a U.S.-based supplier for export to Iran, without the requisite approval from OFAC. To conceal the true destination of the goods from the U.S. supplier, Kuyumcu and a co-conspirator arranged for the items to be shipped first to Turkey and subsequently to Iran. As described in the complaint, Kuyumcu and a co-conspirator used coded language when discussing Iran, such as calling Iran the “Neighbor,” referring to the fact that Turkey shares a border with Iran.
“According to the complaint, Kuyumcu conspired with others to illegally send specialized U.S. technology – over a thousand pounds of metallic powder with nuclear and missile applications – to Iran via Turkey,” said Assistant Attorney General Carlin. “In circumventing U.S. law, including the International Emergency Economic Powers Act, the defendant harmed our nation’s security. The department will continue to vigorously pursue and hold accountable those who evade our export laws in pursuit of profit.”
“U.S. export laws exist to prevent potentially dangerous goods and technology from falling into the wrong hands,” said U.S. Attorney Capers. “Those who seek to evade the scrutiny of the regulatory agencies by operating in the shadows present a danger to our national security and our allies abroad. We will continue to use all of our law enforcement and national security tools to hold such individuals and corporations accountable.”
“As alleged, Erdal Kuyumcu intentionally misrepresented illegal business transactions to make them appear legitimate, thereby threatening national security and violating federal statutes,” said Assistant Director in Charge Diego Rodriguez. “The FBI works with our partners, such as the Department of Commerce, to keep weapons of mass destruction and other embargoed technologies from falling into the wrong hands, to protect national assets, and to strengthen the global threat picture. Special thanks to the FBI special agents who uncovered the alleged conspiracy with their colleagues at the Departments of Commerce and Justice.”
“Today’s action is the result of outstanding collaborative investigative work by the Justice Department, the Commerce Department and the FBI to break up a network whose alleged aim was to illegally ship sophisticated U.S.-origin technology to Iran,” said Special Agent in Charge Jonathan Carson. “We will continue to pursue violators wherever they may be.”
The charges contained in the complaint are allegations, and the defendant is presumed innocent unless and until proven guilty. If convicted of the charges, Kuyumcu faces up to 20 years in prison a $1 million fine.
The case is being prosecuted by Assistant U.S. Attorneys Tiana A. Demas and Ameet B. Kabrawala of the Eastern District of New York, with assistance from Trial Attorney David Recker of the National Security Division’s Counterintelligence and Export Control Section.
Kuyumcu Complaint
Chief Executive Officer of International Metallurgical Company Arrested for Exporting Aerospace-Grade Metals to IranRead the Press Release
Earlier today, Erdal Kuyumcu of Woodside, New York, was arrested on federal charges of illegally exporting a cobalt-nickel metallic powder from the United States to Iran through an intermediary in Turkey.[1] Kuyumcu is scheduled to make his initial appearance today at 3:00 p.m. at the United States Courthouse, 225 Cadman Plaza East, Brooklyn, New York, before United States Magistrate Judge Ramon E. Reyes, Jr.
The arrest and charges were announced by Assistant Attorney General for National Security John P. Carlin, U.S. Attorney Robert L. Capers of the Eastern District of New York, Assistant Director in Charge Diego Rodriguez of the FBI’s New York Field Office and Special Agent in Charge Jonathan Carson of the U.S. Department of Commerce’s Bureau of Industry and Security, Office of Export Enforcement’s New York Field Office.
The complaint alleges that Kuyumcu, a U.S. citizen and the CEO of Global Metallurgy LLC, twice exported a specialized metallic powder used in aerospace, missile production and nuclear applications. Exporting this specialized powder to Iran without a license from the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) is illegal. As detailed in the complaint, Kuyumcu and others conspired to obtain over a thousand pounds of the metallic powder from a U.S.-based supplier for export to Iran, without the requisite approval from OFAC. To conceal the true destination of the goods from the U.S. supplier, Kuyumcu and a co-conspirator arranged for the items to be shipped first to Turkey and subsequently to Iran. As described in the complaint, Kuyumcu and a co-conspirator used coded language when discussing Iran, such as calling Iran the “Neighbor,” referring to the fact that Turkey shares a border with Iran.
“According to the complaint, Kuyumcu conspired with others to illegally send specialized U.S. technology – over a thousand pounds of metallic powder with nuclear applications – to Iran via Turkey,” said Assistant Attorney General Carlin. “In circumventing U.S. law, including the International Emergency Economic Powers Act, the defendant harmed our nation’s security. The department will continue to vigorously pursue and hold accountable those who evade our export laws in pursuit of profit.”
“U.S. export laws exist to prevent potentially dangerous goods and technology from falling into the wrong hands,” said U.S. Attorney Capers. “Those who seek to evade the scrutiny of the regulatory agencies by operating in the shadows present a danger to our national security and our allies abroad. We will continue to use all of our law enforcement and national security tools to hold such individuals and corporations accountable.”
“As alleged, Erdal Kuyumcu intentionally misrepresented illegal business transactions to make them appear legitimate, thereby threatening national security and violating federal statutes. The FBI works with our partners, such as the Department of Commerce, to keep weapons of mass destruction and other embargoed technologies from falling into the wrong hands, to protect national assets, and to strengthen the global threat picture. Special thanks to the FBI special agents who uncovered the alleged conspiracy with their colleagues at the Departments of Commerce and Justice,” stated FBI Assistant Director-in-Charge Rodriguez.
“Today’s action is the result of outstanding collaborative investigative work by the Justice Department, the Commerce Department and the FBI to break up a network whose alleged aim was to illegally ship sophisticated U.S.-origin technology to Iran. We will continue to pursue violators wherever they may be,” said Carson, Special Agent-in-Charge of the Commerce Department’s New York Office of Export Enforcement.
If convicted of the charges, Kuyumcu faces up to 20 years in prison a $1 million fine.
The case is being prosecuted by Assistant U.S. Attorneys Tiana A. Demas and Ameet B. Kabrawala of the Eastern District of New York, with assistance from Trial Attorney David Recker of the National Security Division’s Counterintelligence and Export Control Section.
The Defendant:
ERDAL KUYUMCU
Age: 44
Woodside, New YorkE.D.N.Y. Docket No. 16-0134M
[1] The charges contained in the complaint are allegations, and the defendant is presumed innocent unless and until proven guilty.
President of Aviation Parts Company Arrested for Fraudulently Supplying Defective Airplane Parts to U.S. GovernmentRead the Press Release
Earlier today, Paul Skiscim, President of Aerospec, Inc., was arrested on federal charges of supplying defective airplane parts to the federal government for use in its aircraft, including military aircraft.
The charges were announced by Robert L. Capers, United States Attorney for the Eastern District of New York, and Kenneth J. Siegler, Resident Agent-in-Charge of the Defense Criminal Investigative Service (DCIS), New York Resident Agency.
According to the complaint, Aerospec had been a supplier of airplane parts to the United States from 2003 until 2013, when the company and Skiscim were debarred after supplying the government with defective airplane parts. After his debarment, Skiscim allegedly continued to bid, contract, and supply defective airplane parts to the federal government through a series of shell companies using the names of relatives and fictitious people to mask his involvement from the United States Department of Defense, Defense Logistics Agency. Since 2013, the shell companies received over $2.8 million for the supply of airplane parts, including parts that have been shown to be defective.
“It is critical that federal aircraft, including military aircraft, be built with the best parts available. The defendant’s alleged scheme of supplying defective parts not only violated the law but showed a callous disregard for the safety of federal employees and our military personnel,” stated United States Attorney Capers. “I thank the DCIS, the agency responsible for leading the government’s investigation.”
“America's warfighters deserve the very best to perform their jobs in these difficult times. It is inexcusable that individuals endeavor to enrich themselves by stealing from the U.S. taxpayer through fraud, especially by denying critical goods to our service men and women combating terrorism in a hostile overseas environment. The Defense Criminal Investigative Service remains resolute in our commitment to aggressively investigate these crimes and to support their prosecution to the fullest,” stated DCIS Resident Agent-in-Charge Siegler.
The defendant is scheduled to be arraigned this afternoon before United States Magistrate Judge Anne Y. Shields at the federal courthouse in Central Islip. The charges in the complaint are merely allegations, and the defendant is presumed innocent unless and until proven guilty.
The government’s case is being prosecuted by Assistant United States Attorneys Charles P. Kelly and Robert Schumacher.
The Defendant:
PAUL SKISCIM
Age: 62
East Northport, New YorkE.D.N.Y. Docket No. 16-0155M