Eastern District of New York
Press releases recorded for this federal judicial district.
Former CEO of Long Island Public Telecommunications Company Charged with Insider TradingRead the Press Release
Earlier today, at the federal courthouse in Central Islip, an indictment was unsealed charging Ken Peterman, the former Chief Executive Officer (CEO) of Comtech Telecommunications Corp. (Comtech), a publicly traded company based in Melville, New York, with insider trading and securities fraud. Peterman was arrested this morning in San Diego and is scheduled to make his initial appearance tomorrow in federal court in the Southern District of California. He will be arraigned in the Eastern District of New York at a later date.
Breon Peace, United States Attorney for the Eastern District of New York and James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the arrest and charges.
“As alleged, the defendant exploited for his own personal benefit confidential information, including derogatory news of his own impending termination, that was meant to be available only for corporate purposes,” stated United States Attorney Peace. “In doing so before he was shown the door, Peterman breached the trust and confidence placed in him by his former employer and its shareholders. My Office will vigorously prosecute those, like Peterman, who would seek to enrich themselves at the expense of ordinary investors and the integrity of the securities markets.”
Mr. Peace also expressed his appreciation to the U.S. Securities and Exchange Commission, New York Regional Office for its work on the case.
“Ken Peterman allegedly acted on non-public information of the company’s confidential fiscal reporting and his pending termination to avoid financial repercussions. This alleged attempt at self-preservation exploited a respected position and disrupted public confidence in future financial leadership. The FBI remains committed to apprehending those who fraudulently prioritize personal wealth over adherence to the regulations of our economic system,” stated FBI Assistant Director in Charge Dennehy.
As alleged, Peterman was the CEO and Chairman of the Board of Directors for Comtech. In his capacity as an officer and director of the company, Peterman obtained material, non-public information concerning the company’s financial performance and internal decision-making. For example, in early March 2024, Peterman received a confidential briefing from Comtech’s Chief Financial Officer, during which Peterman was informed of an upcoming negative earnings release. In addition, around the same time, Peterman was informed that, based on an alleged improper relationship with a subordinate employee, Comtech’s Board had resolved to terminate Peterman for cause. The indictment alleges that on March 12, 2024, shortly after learning of the negative earnings report and his impending ouster, and prior to the public release of such information, Peterman hurriedly sold and/or attempted to sell tens of thousands of shares of Comtech’s stock, which he held in two brokerage accounts.
The charges in the indictment are allegations and the defendant is presumed innocent unless and until proven guilty. Peterman faces up to 25 years in prison if convicted of securities fraud, and up to 20 years in prison if convicted of wire fraud.
In July 2022, Mr. Peace was selected as the Chairperson of the White Collar Fraud subcommittee for the Attorney General’s Advisory Committee (AGAC). As the leader of the subcommittee, Mr. Peace plays a key role in making recommendations to the AGAC to facilitate the prevention, investigation and prosecution of various financially motivated, non-violent crimes, including frauds affecting the integrity of the markets, such as those Peterman is alleged to have committed.
The government’s case is being handled by the Criminal Section of the Office’s Long Island Division. Assistant United States Attorney Anthony Bagnuola is in charge of the prosecution.
The Defendant:
KEN A. PETERMAN
Age: 67
Encinitas, CaliforniaE.D.N.Y. Docket No. 24-CR-489 (JMA)
24-cr-489_peterman.indictment.pdfManager of U.S. Freight Forwarding Company Indicted for Circumventing Export ControlsRead the Press Release
BROOKLYN, NY – A 12-count indictment was unsealed today in federal court in Brooklyn charging Natalya Ivanovna Mazulina, also known as “Natasha Mazulina,” for her alleged involvement in a scheme to circumvent U.S. export laws and sanctions on Russia. Mazulina, the Western regional manager of a freight forwarding company based in Jamaica, New York, which operated out of John F. Kennedy International Airport (JFK airport) in Queens, New York, and Seattle-Tacoma International Airport in Washington State, was arrested earlier today in Seattle and will be arraigned in the Eastern District of New York at a later date.
Breon Peace, United States Attorney for the Eastern District of New York; Matthew G. Olsen, Assistant Attorney General for the Justice Department’s National Security Division; James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI); and James Guanci, Special Agent in Charge, U.S. Department of Commerce (DOC), Office of Export Enforcement, Boston, announced the arrest and charges.
“As alleged, Mazulina used her position as a manager of a freight forwarding company to facilitate unlawful exports to Russia through JFK airport,” stated United States Attorney Peace. “Evading U.S export regulations presents a danger to our national security, and we will continue to use all of our law enforcement and national security tools make sure these enablers, both individuals and corporations, cannot operate in our district.”
Mr. Peace extended his appreciation to the U.S. Attorney’s Office for the Western District of Washington, the FBI’s Seattle Field Office, and the DOC’s Boston Field Office for their assistance in this case.
“The defendant exploited her knowledge of the export business to falsify documents and circumvent U.S. sanctions by illegally shipping oil and gas products to Russian customers,” stated Assistant Attorney General Olsen. “American companies like the freight forwarder where Mazulina worked play a critical role in the global supply chain and movement of goods. The National Security Division will not tolerate individuals who seek to abuse their positions in these companies for financial gain at the expense of national security.”
“Collaborating with foreign actors to evade U.S. export controls is a serious national security violation,” said DOC Special Agent in Charge Guanci. “The Office of Export Enforcement, alongside its law enforcement partners, will continue to aggressively investigate efforts to illicitly fuel Russia’s wartime economy.”
As alleged in the indictment, from at least December 2022 through December 2024, Mazulina conspired with Russian freight forwarding companies and others to unlawfully ship controlled items, including industrial oil and gas equipment from the United States to Russia, through intermediary countries. At one point, in June 2023, Mazulina told colleagues that her clients were paying through bank accounts in third party countries because “[m]ost of [her] clients [were] currently sanctioned with USA.” Mazulina attempted to conceal the unlawful scheme by submitting and causing the submission of false export documents to the U.S. government, documents which should have revealed that the exported goods were destined for Russia.
Mazulina is charged with conspiracy to export controlled goods to Russia without a license, conspiracy to defraud the U.S., conspiracy to commit money laundering, exporting controlled goods to Russia without a license, filing false export documents with the U.S. government, and smuggling goods contrary to U.S. law. If convicted, she faces a maximum penalty of 20 years in prison for each count of conspiring to export or exporting controlled goods to Russia without a license; up to 20 years in prison for conspiring to commit money laundering; up to 10 years in prison for each count of smuggling; and up to five years in prison for each count of conspiracy and filing false export documents with the U.S. government.
The charges in the indictment are allegations, and the defendant is presumed innocent unless and until proven guilty.
The government’s case is being handled by the Office’s National Security and Cybercrime Section. Assistant United States Attorneys Artie McConnell and Matthew Skurnik are in charge of the prosecution, along with Trial Attorneys Christopher M. Rigali and Adam Barry of the National Security Division’s Counterintelligence and Export Control Section, and with the assistance of Litigation Analyst Emma Tavangari. The Department of Justice’s Money Laundering and Asset Recovery Section assisted with this investigation.
The investigation was coordinated through the Justice Department’s Task Force KleptoCapture, an interagency law enforcement task force dedicated to enforcing the sweeping sanctions, export controls and economic countermeasures that, beginning in 2014, the United States, along with its foreign allies and partners, has imposed in response to Russia’s unprovoked military invasion of Ukraine. Announced by the Attorney General on March 2, 2022, and under the leadership of the Office of the Deputy Attorney General, the task force will continue to leverage all of the department’s tools and authorities to combat efforts to evade or undermine the collective actions taken by the U.S. government in response to Russian military aggression.
The Defendant:
NATALYA IVANOVNA MAZULINA (also known as “Natasha Mazulina”)
Age: 41
Federal Way, WashingtonE.D.N.Y. Docket No. 24-CR-493 (EK)
18th Street Gang Leader is Ninth and Final Defendant to Plead Guilty to Racketeering ConspiracyRead the Press Release
Earlier today, Junior Zelaya Canales, also known as “Terco,” a Queens-based regional leader of the 18th Street gang, pleaded guilty to racketeering conspiracy charges in connection with his participation in the September 12, 2016 murder of 15-year-old Joshua Guzman in Hempstead, New York. The guilty plea proceeding was held in federal court in Brooklyn before United States District Judge Hector Gonzalez.
Zelaya Canales is the ninth and final defendant to plead guilty under a seventh superseding indictment in connection with a sprawling racketeering conspiracy that also involved the October 25, 2017 murder of 20-year-old Jonathan Figueroa in Saugerties, New York; the February 2, 2018 murder of 20-year-old Oscar Antonio Blanco Hernandez in Queens; and multiple shootings and other gang activity. Zelaya Canales’ co-defendants Walter Fernando Alfaro Pineda, Jose Douglas Castellano, Yanki Misael Cruz Mateo, Israel Mendiola Flores, Yoni Alexander Sierra, Jose Jimenez Chacon, Carolina Cruz and Eric Chavez previously pled guilty. Flores and Chacon were previously sentenced to 425 months’ imprisonment and 269 months’ imprisonment, respectively. At sentencing, each remaining defendant faces up to life imprisonment.
Breon Peace, United States Attorney for the Eastern District of New York and James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI) announced the guilty pleas.
“Today’s guilty plea marks the end of a sweeping investigation into the violent and disturbing affairs of the 18th Street gang that removed some of the most influential, powerful and ruthless gang leaders and members from city streets across the country,” stated United States Attorney Peace. “Together with our law enforcement partners around the nation and the world, my Office will not rest until the scourge of gang violence and senseless loss of life is put to an end. While these guilty pleas cannot undo the grave harm this gang has caused, we hope that it will bring a measure of closure to the victims and their families.”
Mr. Peace expressed his appreciation to the United States Attorney’s Office for the Northern District of New York, the Ulster County District Attorney’s Office, the Queens County District Attorney’s Office, the Nassau County District Attorney’s Office, the United States Department of Homeland Security, Homeland Security Investigations Dallas, the New York State Police, the Kingston Police Department, the New York City Police Department (NYPD), the Nassau County Police Department, the Hempstead Police Department, and the Justice Department’s Office of International Affairs for their assistance during the investigation.
Today’s conviction is the latest in a series of recent convictions in this case of leaders, members and associates of 18th Street. According to court filings and proceedings, 18th Street is a well-known and well-established international criminal organization and violent street gang with members and associates residing throughout New York State including Queens and Long Island, and elsewhere throughout the United States including Houston, Texas. 18th Street members regularly engage in murder, attempted murder, assault, extortion, illegal drug and firearms trafficking, false identification document production, witness tampering and money laundering. The defendants occupied various positions within the gang:
- Alfaro Pineda was a national 18th Street gang leader based in Houston, Texas, whose power and control extended across the United States. For example, he collected illicit funds raised by gang members in New York from fees extorted from prostitution brothels and illegal drug trafficking to further promote gang activity, including by providing the money to incarcerated 18th Street members in the United States and in El Salvador. Alfaro Pineda also supplied and trafficked illegal firearms to the gang’s New York-based members.
- Zelaya Canales was a regional 18th Street gang leader based in Queens, New York, whose power and control extended across the New York City metropolitan area.
- Castellano was a senior 18th Street gang member based in Brooklyn, New York, whose influence extended to upstate New York.
- Cruz Mateo was a Queens-based 18th Street gang member.
- Flores was a Kingston, New York-based 18th Street gang associate.
- Sierra was a Queens-based 18th Street gang associate.
- Chacon was a New Jersey-based 18th Street gang member.
- Cruz was a New Jersey-based 18th Street gang associate.
- Chavez was a Queens-based 18th Street gang member.
The defendants committed multiple acts of violence in order to promote and enhance the prestige and reputation of the gang, and to maintain and increase their own membership and status in the gang, including:
September 12, 2016 Murder of Joshua Guzman
In September 2016, Zelaya Canales, then the regional leader of the Shatto Park Locos Sureños (SPLS) sect of 18th Street, ordered that Guzman be killed, in part, because the gang perceived Guzman to have been disrespectful towards 18th Street gang members. In the evening of September 11, 2016, Zelaya Canales dispatched two lower-level gang members to Long Island to lure Guzman out and murder him as part of a demonstration of their allegiance to 18th Street. On September 12, 2016 at approximately 1:03 a.m., the Hempstead Police Department received a ShotSpotter notification of gunshots fired near the intersection of Linden Avenue and Laurel Avenue in Hempstead, New York. A Hempstead Police Department officer and members of Nassau Police Department responded to the location and discovered the body of 15-year-old Guzman near the curb. Guzman was shot once in the back of the head and pronounced dead at the crime scene.
July 9, 2017 Attempted Murder of Rival Gang Members
On July 9, 2017, Zelaya Canales led a shootout in Woodside, Queens, with assistance from at least two additional 18th Street gang members, over a territorial dispute with a rival gang. At approximately 10:35 p.m., NYPD officers responded to the area after numerous calls were made to 9-1-1 concerning multiple gunshots. Multiple witnesses reported hearing gunshots and seeing approximately three to four men run towards Woodhaven Boulevard. After a canvas of the area, police officers recovered nine 9-millimeter shell casings among other evidence.
NYPD subsequently went to Zelaya Canales’s apartment in Queens to execute two arrest warrants unrelated to the shooting. During the execution of the warrants, NYPD recovered a 9-millimeter Ruger with a defaced serial number, 4 rounds of 9-millimeter ammunition, 56 rounds of .357 magnum ammunition, 34 rounds of .380 caliber ammunition and 23 rounds of .38 ammunition. Subsequent forensic ballistics examination revealed that the Zelaya Canales’s 9-mm Ruger was the same weapon that fired the 9-millimeter shell casings found at the crime scene of the July 9, 2017 shootout in Woodhaven.
September 20, 2017 Assault of John Doe
On September 20, 2017, Chavez, together with another 18th Street gang member, approached an individual (John Doe) on the street and shot him because they believed he was a member of the rival gang Mara Salvatrucha (MS-13). John Doe survived and was treated for a gunshot wound at a local hospital.
October 25, 2017 Murder of Jonathan Figueroa
By October 2017, gang members in New York suspected Jonathan Figueroa, a fellow 18th Street gang member, of cooperating with law enforcement in connection with the investigation of the murder of Guzman. Senior gang members, including Castellano, sought Alfaro Pineda’s authorization to murder Figueroa. Alfaro Pineda’s authorization was sought because Alfaro Pineda had initiated Figueroa into 18th Street in Houston, Texas, and because murdering a fellow gang member required approval from a senior member of the gang, such as Alfaro Pineda. With Alfaro Pineda’s authorization, Castellano activated gang members based in Kingston, New York, and directed them to coordinate with Queens-based gang members to see to Figueroa’s execution. Gang members in Kingston then began digging a grave in Turkey Point State Forest in anticipation of Figueroa’s arrival.
In the late-night hours of October 24, 2017, Cruz Mateo lured and travelled with Figueroa from Queens to Kingston, New York. Upon their arrival in Kingston, they were met by Flores and other 18th Street members and associates who, into the early morning hours of October 25, 2017, brought Figueroa to Turkey Point State Forest, brutally stabbed him to death and buried him in the makeshift grave. Cruz Mateo ordered the murder to be video-recorded—capturing multiple 18th Street members and associates repeatedly stabbing Figueroa, slashing his throat, amputating his ear and dragging his body. In the video, Cruz Mateo stated that Figueroa was being murdered for “being a rat.” Cruz Mateo then sent the video to other 18th Street members as a warning to other gang members who might disrespect the gang or cooperate with law enforcement. Figueroa’s body was discovered in February 2018 by the FBI, along with state and local law enforcement authorities, in a five-foot deep grave in Turkey Point. He sustained more than 100 stab wounds including at least one stab wound to the head that appears to have fractured his skull, and a slash to his throat that ruptured his trachea.
February 2, 2018 Murder of Oscar Antonio Blanco Hernandez
On February 2, 2018, several gang members killed Blanco Hernandez because they believed he was a member of the rival MS-13 gang. Chacon had met Blanco Hernandez weeks earlier through their mutual employer, a New Jersey-based house painting company. On the morning of the murder, Cruz and Chacon picked up Blanco Hernandez at his home in New Jersey under the guise of going to smoke marijuana as friends. Cruz and Chacon drove Blanco Hernandez to Queens where they met 18th Street gang members including Cruz Mateo and Sierra who entered the rear passenger seat of Cruz’s car on opposite sides, sandwiching Blanco Hernandez between them. Cruz drove Chacon, Cruz-Mateo, Sierra and Blanco Hernandez a short distance to a quiet residential neighborhood. Cruz-Mateo, Sierra and Blanco-Hernandez got out of the car and started walking, while Cruz and Chacon stayed behind with the car. After walking for a few minutes, Cruz-Mateo drew a .380 caliber semiautomatic handgun and shot Blanco-Hernandez in the back of the head, killing him instantly. Blanco Hernandez’s body was discovered on a residential street in the Jamaica Hills section of Queens. He sustained three gunshot wounds: two gunshots to the torso and one to the head.
* * * * *
This case is part of an ongoing Organized Crime Drug Enforcement Task Forces (OCDETF) investigation led by the United States Attorney’s Office for the Eastern District of New York and the FBI. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply. OCDETF uses a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state and local law enforcement agencies against criminal networks.
The government’s case is being handled by the Office’s International Narcotics and Money Laundering Section. Assistant United States Attorneys Jonathan P. Lax, Erin Reid, Margaret Schierberl, Adam Amir and Rebecca Urquiola are in charge of the prosecution, with the assistance of Paralegal Specialists Tareva Torres and Samuel Ronchetti.
The Defendant:
JUNIOR ZELAYA-CANALES, also known as “Terco”
Age: 28
Jamaica, New YorkCo-Defendants Previously Convicted:
WALTER FERNANDO ALFARO PINEDA, also known as “Clever”
Age: 45
Houston, TexasYANKI MISAEL CRUZ MATEO, also known as “Yenki Misael Cruz Mateo,” “Yankee Mateo,” “Doggy” and “Wino”
Age: 25
Jamaica, New YorkISRAEL MEDIOLA FLORES, also known as “Chapito” and “Sinaloa”
Age: 29
Kingston, New YorkYONI ALEXANDER SIERRA, also known as “Arca,” “Arc Angel” and “Wasson”
Age: 26
Jamaica, New YorkJOSE JIMENEZ CHACON, also known as “Little One”
Age: 26
New Brunswick, New JerseyCAROLINA CRUZ, also known as “La Fiera”
Age: 31
Elizabeth, New JerseyJOSE DOUGLAS CASTELLANO, also known as “Chino”
Age: 26
Brooklyn, New YorkERIC CHAVEZ, also known as “Lunatico”
Age: 25
Jamaica, New YorkE.D.N.Y. Docket No. 18-CR-139 (S-7) (HG)
Nine Eastern District of New York Employees and One Former Assistant U.S. Attorney Receive the Executive Office for United States Attorneys (EOUSA) Director's AwardRead the Press Release
Seven Assistant United States Attorneys (AUSAs), a Public Affairs Officer, a Victim Witness Specialist, and a former AUSA from the Eastern District of New York, were among those recognized by the Director of the Executive Office for U.S. Attorneys (EOUSA) as recipients of the 39th Annual Director’s Awards.
Breon Peace, United States Attorney for the Eastern District of New York, stated: “I am filled with pride and admiration for the honorees whose outstanding work has furthered the mission of our Office and the Department of Justice through aggressive, fair, and compassionate enforcement of the law, and dedication to crime prevention and reentry initiatives.”
EOUSA Director Stephanie Hinds stated: “I extend my heartfelt congratulations and appreciation to all the award recipients. This recognition is a testament to your hard work, tireless dedication, and unwavering commitment for advancing the Department of Justice’s mission.”
Superior Performance as an Assistant United States Attorney – Civil Division
AUSAs David Cooper and Dara Olds are recognized for their exceptional work defending the government’s interest in Campos, et al. v. Kijikazi. The case involved the Social Security Administration’s response to the global pandemic and the continuation of benefits for those in the Supplemental Security Income program.
Superior Performance by a Litigative Team – U.S. v. UBS Securities LLC et al.
AUSAs Michael Castiglione, Richard Hayes, Edward Newman, Bonni Perlin and former AUSA Melanie Speight, together with AUSAs Austin Hall and Andres Sandoval from the Northern District of Georgia and Special Agents Joseph Della Penna and Ines Cabral with the Federal Housing Finance Agency—Office of Inspector General, are recognized for reaching a $1.435 billion settlement to resolve claims that UBS made misrepresentations to investors in the sale of residential mortgage-backed securities. The settlement redressed UBS’s fraudulent conduct and serves to deter similar conduct in the future.
Superior Performance in Prevention and Reentry Activities
In support of the Office’s commitment to rehabilitation, community reintegration and reducing recidivism, the Reentry Team of AUSA Nomi Berenson, Public Affairs Officer Danielle Blustein Hass and Victim Witness Specialist Gladian Rivera guided the 2023 launch of the Eastern District’s Reentry Initiative. The groundbreaking initiative includes establishing the RAISE court, which is short for Reentry Assistance and Initiatives Supporting Everyone. Presided over by the Honorable LaShann DeArcy Hall, this court helps to provide resources to formerly incarcerated federal inmates identified as being at the highest risk of violence and recidivating. The team also conducts quarterly forums at Brooklyn House, the local federal Residential Reentry Center, in which returning citizens share their post-prison reentry experiences and service providers advise of available reentry services. In addition, the team has hosted reentry simulations for the Office and outside organizations to improve community understanding of the challenges encountered by individuals returning to society after incarceration.
EOUSA provides oversight, general executive assistance, and direction to the 94 United States Attorney’s offices around the country. For more information on EOUSA and its mission, visit http://www.justice.gov/usao. For more information about the United States Attorney’s Office for the Eastern District of New York, visit https://www.justice.gov/usao-edny.
Nebraska Man Pleads Guilty in Multi-Million Dollar “Cryptojacking” CaseRead the Press Release
Earlier today, in federal court in Brooklyn, Charles O. Parks III, also known as “CP3O,” pleaded guilty to wire fraud for operating a large-scale illegal “cryptojacking” operation. As part of the scheme, Parks defrauded two well-known providers of cloud computing services out of more than $3.5 million worth of computing resources in order to mine cryptocurrency worth nearly $1 million. The proceeding was held before United States Magistrate Judge Cheryl L. Pollak. When sentenced, Parks faces up to 20 years in prison.
Breon Peace, United States Attorney for the Eastern District of New York, James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Jessica S. Tisch, Commissioner, New York City Police Department (NYPD), announced the guilty plea.
“Through fraud and deceit, Parks acquired powerful computing resources worth millions of dollars to fuel his illegal cryptomining operation,” stated United States Attorney Peace. “Today’s guilty plea underscores our strong commitment to prosecuting criminal actors who enrich themselves through sophisticated cryptocurrency frauds and other complex cyber schemes.”
Mr. Peace also thanked the FBI’s New York Cyber Crimes Task Force for their assistance on this case.
“This guilty plea serves as a reminder to potential cybercriminals that experienced law enforcement officers are well-equipped to detect, investigate, and put an end to financial exploitation schemes carried out in the digital world,” stated NYPD Commissioner Tisch. “I commend our NYPD detective who worked this case, as well as our partners at the FBI and the office of the U.S. Attorney for the Eastern District of New York, for their skill and unwavering dedication to their work, as evidenced by today’s outcome.”
“Cryptojacking,” also referred to as malicious cryptomining, is the unauthorized use or hijacking of another party’s resources, such as electricity, hardware or computing power to mine cryptocurrency. According to court filings and facts presented at today’s plea hearing, from in or about January 2021 through August 2021, Parks created and used a variety of names, corporate affiliations and email addresses, including emails with domains from corporate entities he operated called “MultiMillionaire LLC” and “CP3O LLC,” to register numerous accounts with the cloud providers and to gain access to massive amounts of computing processing power and storage that he did not pay for. Parks used those fraudulently obtained resources to mine various cryptocurrencies including Ether, Litecoin and Monero. Parks tricked the providers into approving heightened privileges and benefits, including elevated levels of cloud computing services and deferred billing accommodations, and deflected inquiries from the providers regarding questionable data usage and mounting unpaid subscription balances.
Parks converted and laundered the cryptocurrency proceeds through cryptocurrency exchanges, a non-fungible token marketplace, an online payment provider and traditional bank accounts in order to disguise the audit trail and disassociate the funds from the fraud. Parks also structured various money movements to avoid transaction reporting requirements under federal law. After converting the ill-gotten cryptocurrency into dollars, Parks used the proceeds of the scheme to make extravagant purchases, including a Mercedes Benz luxury car, jewelry and first-class hotel and travel expenses.
The government’s case is being handled by the Office’s National Security and Cybercrime Section. Assistant United States Attorneys Andrew Reich and Artie McConnell are in charge of the prosecution.
The Defendant:
CHARLES O. PARKS III (also known as “CP3O”)
Age: 45
Omaha, NebraskaE.D.N.Y. Docket No. 24-CR-105 (EK)
Queens Man Pleads Guilty to Firebombing Apartment Building in FlushingRead the Press Release
Earlier today, in federal court in Brooklyn, Atahualpa Rodriguez pleaded guilty to committing arson of an apartment building in Flushing, Queens. The proceeding was held before United States District Judge Allyne R. Ross. When sentenced, Rodriguez faces a mandatory minimum sentence of five years in prison and a maximum of 20 years.
Breon Peace, United States Attorney for the Eastern District of New York, Robert S. Tucker, Commissioner New York City Fire Department (FDNY), and Jessica S. Tisch, Commissioner, New York City Police Department (NYPD), announced the guilty plea.
“Today, the defendant admitted that he deliberately set fire to an apartment building in the pre-dawn darkness while many tenants slept, causing the destruction of one apartment unit, damage to surrounding units and injuries to the brave first responders who battled the blaze,” stated United States Attorney Peace. “His actions showed complete disregard for human life and placed hundreds of people in grave danger over a personal dispute. Rodriguez will now face just punishment for his actions.”
“Deliberately setting a fire is an egregious crime that deserves severe punishment,” said FDNY Commissioner Tucker. “In this case, three of our firefighters were injured due to this unspeakable crime. We want to thank the NYPD’s Arson and Explosion Squad along with FDNY fire marshals and ATF agents for their diligent and swift work in this case. We are relieved Atahualpa Rodriguez will no longer be on our city’s streets.”
“Deliberate criminal activity, such as the type Mr. Rodriguez pleaded guilty to today, poses a significant threat to both first responders and private citizens and goes against everything that New York City stands for,” stated NYPD Commissioner Tisch. “I am grateful that the injuries sustained by our FDNY colleagues were not more severe, and I commend them for their dedication in maintaining the safety of all New Yorkers. I also thank our partners at the office of the U.S. Attorney for the Eastern District of New York for their diligent efforts in ensuring that criminal actions are met with appropriate consequences.”
According to court filings and facts presented during the plea proceeding, on January 11, 2022, Rodriguez was in a dispute with the tenants of one unit in the building. On January 12, 2022, Rodriguez firebombed the multi-story building on Parsons Boulevard in Flushing, Queens, which contained approximately 175 units and hundreds of tenants. At approximately 4:40 a.m. on January, a resident of the targeted apartment unit awoke to the sound of breaking glass and heard a voice state: “F—k you all.” The resident walked out of the bedroom and saw the fire ignited by the defendant. One firefighter was injured when a section of ceiling collapsed on him, another suffered first-degree burns and a third was hospitalized after breathing contaminated air. The fire caused approximately $1 million in damages and completely destroyed the targeted apartment unit, as depicted below.
Assistant United States Attorney Adam Amir is in charge of the prosecution.
The Defendant:
ATAHUALPA RODRIGUEZ
Age: 50
Flushing, New YorkE.D.N.Y. Docket No. 23-CR-266 (ARR)
Former Long Island Resident Pleads Guilty to Massive Fraud Scheme Involving Sports BettingRead the Press Release
Earlier today, in federal court in Central Islip, Cory Zeidman pleaded guilty to conspiring to commit mail and wire fraud in connection with a yearslong scheme to defraud prospective sports bettors in New York and Florida by claiming to have inside information on sporting events. The proceeding was held before United States Magistrate Judge Lee G. Dunst. When sentenced, Zeidman faces a maximum sentence of 20 years’ imprisonment, as well as forfeiture and restitution of approximately $3.6 million.
Breon Peace, United States Attorney for the Eastern District of New York, William S. Walker, Special Agent in Charge, Homeland Security Investigations, New York (HSI), Daniel B. Brubaker, Inspector in Charge, United States Postal Inspection Service, New York (USPIS) and Patrick J. Ryder, Commissioner, Nassau County Police Department (NCPD), announced the guilty plea.
“Zeidman and his partners baited unsuspecting victims with false claims of an edge in sports betting only to feed them lies and pocket millions of dollars from their savings and retirement accounts,” stated United States Attorney Peace. “Today’s guilty plea sends a message to all those who would prey upon the public by falsely advertising gambling as an ‘investment opportunity’: the only sure bet here is that this Office will work tirelessly to root out sources of disinformation and fraud and prosecute them to the fullest extent of the law.”
“Sports bettors sought Corey Zeidman’s advice before gambling their money— but it was Zeidman himself who was scoring big through his deceptive practices, outright lies, and high-pressure tactics that exploited unsuspecting clients,” stated HSI New York Special Agent in Charge Walker. “Today, HSI New York and our law enforcement partners brought Zeidman’s racket to an end. The public deserves to know the truth concerning where their money is going, and HSI is committed to working with our partners to protect the community wherever and whenever possible from illicit schemes.”
“Today’s guilty plea is proof that this individual gambled and lost when he thought his illegal activities would fly under the radar,” stated USPIS Inspector in Charge Brubaker. “Illegal gambling is not a victimless crime, Zeidman and his partners were able defraud so many individuals with their lies and had them pay these exorbitant fees for nothing. USPIS will continue to investigate individuals who are intentionally skirting federal regulations for their own selfish desires. I would like to thank Homeland Security Investigations, Nassau County Police Department, and the United States District Court for the Eastern District of New York for their collaborative effort on this massive investigation,” stated USPIS Inspector in Charge Brubaker.
“The guilty plea of defendant Cory Zeidman is a reminder that crimes against our residents will not go unpunished. Numerous victims lost millions of dollars after being given fraudulent and misleading information regarding online betting. We need to set an example and continue to investigate and arrest offenders who commit fraud and any other crimes against our residents. I would like to thank the United States Attorney for the Eastern District of New York and Homeland Security Investigations for their assistance in this case,” stated NCPD Commissioner Ryder.
As alleged in court documents, Zeidman helped run an organization that placed national radio advertisements to lure prospective bettors to retain the organization for sports betting advice. Using fake names and high-pressure sales tactics, Zeidman and his partners falsely led the bettors to believe that their organization had access to non-public information—bettors were often told, for example, that Zeidman’s organization had access to non-public player injury information, “dirty” referees, or that professional sporting events were “fixed” and that media executives’ shares predetermined outcomes with Zeidman’s organization. This information, the bettors were told, made gambling on sporting events a low or no-risk proposition. Victims were required to pay exorbitant fees to obtain this supposedly privileged information which, unbeknownst to them, was fictitious or based on the conspirators’ open-source internet research. Over the course of several years, Zeidman and his partners reaped millions in fees from victims.
Any individuals who believe they may have been the victim of the alleged crimes perpetrated in connection with this release can contact HSI at 1-866-347-2423.
In July 2022, Mr. Peace was selected as the Chairperson of the White Collar Fraud subcommittee for the Attorney General’s Advisory Committee (AGAC). As the leader of the subcommittee, Mr. Peace plays a key role in making recommendations to the AGAC to facilitate the prevention, investigation and prosecution of various financially motivated, non-violent crimes including the sort of predatory fraud perpetrated by Zeidman and his partners.
The government’s case is being handled by the Office’s Long Island Criminal Section. Assistant United States Attorneys Charles P. Kelly and Anthony Bagnuola are in charge of the prosecution, with assistance from Paralegal Specialist Samantha Schroder and FSA Supervisory Paralegal Melissa Thorpe.
The Defendant:
CORY ZEIDMAN
Age: 63
Boca Raton, FloridaE.D.N.Y. Docket No. 22-CR-228 (JS)
United States Settles Claim Against New York Dermatology Practice Whose Medical Doctor Refused to Perform a Medical Procedure on an HIV-Positive PatientRead the Press Release
Breon Peace, United States Attorney for the Eastern District of New York, announced today a settlement with Advanced Dermatology, P.C. (Advanced Dermatology), a New York-based practice with dermatology offices located throughout the metropolitan area and other states, resolving allegations that one of its medical doctors violated Title III of the Americans with Disabilities Act (the ADA), by refusing to perform a scheduled procedure on an individual with human immunodeficiency virus (HIV) until the end of the day after all other patients had been treated or reschedule his appointment for another day when no other patients were being treated. Title III of the ADA prohibits discrimination against individuals with disabilities in places of public accommodation such as medical facilities. HIV is a disability that falls within the protection of the ADA. Advance Dermatology cooperated with the United States’ investigation and in resolving the matter.
“This settlement reflects this Office’s commitment to robust enforcement of the ADA and ensuring that patients with HIV have access to medical care,” stated United States Attorney Peace.
This matter was initiated after the U.S. Department of Justice received a complaint from John Doe,[1] an individual who is HIV-positive. John Doe alleged that a dermatologist employed by Advanced Dermatology at its Fresh Meadows, New York office refused to perform a Mohs micrographic surgery on a scheduled date and time. The surgical procedure had been scheduled to treat John Doe’s basal cell carcinoma.
The United States’ investigation determined that the dermatologist refused to perform the scheduled surgery, and that the dermatologist told John Doe that the reason for his refusal was John Doe’s HIV-positive status and concern for the safety of a technician working with the doctor. The dermatologist told John Doe that he would need to wait until the end of the day after all other patients had been treated or reschedule his appointment for another day when no other patients were being treated. John Doe left Advanced Dermatology that day without being treated. The United States determined that Advanced Dermatology discriminated against John Doe on the basis of his HIV status in violation of Title III of the ADA.
Under the terms of the settlement, Advanced Dermatology will ensure that its policies and practices are brought into compliance with Title III of the ADA, adopt a non-discrimination policy establishing that Advanced Dermatology does not discriminate in providing services to those with disabilities, and train its staff annually about HIV/AIDS and discrimination. Advanced Dermatology will also pay a civil penalty of $15,000 to the United States.
The claims resolved by this settlement are allegations only and there has been no admission or determination of liability.
This matter was handled by the Office’s Civil Division. Assistant U.S. Attorney David Cooper is in charge of the prosecution.
[1] John Doe is identified by a pseudonym to protect his privacy.
Queens Man Sentenced to 15 Years in Prison for Robbing Bank While on ParoleRead the Press Release
Earlier today, at the federal courthouse in Brooklyn, Gerald DeRosse was sentenced by United States District Judge William F. Kuntz II to 180 months in prison for committing a violent robbery of a Ridgewood Savings Bank in Queens, New York. He is also required to pay $205 in restitution and $205 in forfeiture. DeRosse pleaded guilty to the charge in May 2024.
Breon Peace, United States Attorney for the Eastern District of New York and James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation (FBI), New York Field Office, announced the sentence.
“The defendant, a serial bank robber, chose to terrorize hard-working bank tellers and customers, for his own selfish purposes. The victims, including an elderly woman the defendant locked in a chokehold, will never forget that day,” stated United States Attorney Peace. “It is a vital part of our mission to protect our community, and my Office will continue to tirelessly prosecute repeat offenders who show no respect for the law.”
“While on parole for a prior bank robbery, Gerald DeRosse once again terrorized our city by committing the same crime in which he utilized an innocent bystander as collateral to ensure his demands were met,” stated FBI Assistant Director in Charge Dennehy. “DeRosse's actions carelessly endangered the lives of others out of personal greed. The FBI will not tolerate repeat offenders who consistently threaten the safety of our city and its citizens.”
As described in the government’s sentencing memorandum and other court documents, on April 6, 2023, DeRosse entered a branch of Ridgewood Savings Bank on Myrtle Avenue in Glendale, Queens, grabbed an elderly bank customer around the neck, and yelled that he was going to “blow her f-----g brains out” if the bank teller did not give him money. Another customer hid under a desk during the robbery. A screenshot from the bank’s video surveillance system, showing this harrowing moment, appears below.
The bank teller obeyed DeRosse’s demand and gave him $205 in cash. DeRosse then fled, but he was identified and arrested by the FBI a few weeks later. DeRosse previously had been convicted of robbery-related crimes on at least seven occasions and was on parole, having served a 13-year sentence for bank robbery at the time he committed this bank robbery. He had been released from state prison less than a month earlier.
Assistant United States Attorney Rebecca M. Schuman is in charge of the prosecution.
The Defendant:
Gerald DeRosse
Age: 55
Broad Channel, New YorkE.D.N.Y. Docket No. 23-CR-221 (WFK)
Former New York City Police Officer Convicted of Sex Offenses Involving Four Minor Boys and the Sexual Assault of Two of Those ChildrenRead the Press Release
Christopher Terranova, a former New York City Police Department (NYPD) officer, was found guilty today by a federal jury in Brooklyn on all six counts of a superseding indictment charging him with sexually exploiting, attempting to sexually exploit and enticing and coercing three 15-year-old boys and a 12-year-old boy. The verdict followed a five-day trial before United States District Judge Kiyo A. Matsumoto. Terranova filed for retirement in September 2023 while under suspension from NYPD. When sentenced, Terranova faces a mandatory minimum of 15 years’ imprisonment and up to life in prison.
Breon Peace, United States Attorney for the Eastern District of New York and James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the verdict.
“As proven at trial, the defendant preyed on vulnerable minors through social media and on Staten Island where he abused his position as a police officer to gain the trust of his victims in a despicable strategy to gratify his sexual desires,” stated United States Attorney Peace. “Today’s verdict hopefully will help victims on their path to healing with the knowledge that the defendant has been brought to justice for his crimes. Parents and caregivers should have conversations with their children about the dangers of communicating online with strangers and as well as individuals they know, and report inappropriate contacts to law enforcement.”
Mr. Peace expressed his appreciation to the NYPD Internal Affairs Bureau for their assistance during the investigation.
“Christopher Terranova, a former NYPD officer, violated his sworn oath to protect and serve by preying upon four minor boys for personal gratification,” stated FBI Assistant Director in Charge Dennehy. “Terranova strategically exploited his position to establish an inappropriate relationship with his victims and impose undue sexual influence. While the majority of law enforcement conduct themselves accordingly, the FBI will continue to partner with the NYPD’s Internal Affairs Bureau to investigate any officer abusing their badge for twisted desires.”
Between approximately December 2019 and May 2023, Terranova used social media to engage in sexually explicit conversations with underage boys and attempt to entice them into taking sexually explicit photographs of themselves and sharing them with the defendant. Terranova used popular social media applications to message and gain the trust of underage boys whom he encountered socially, online or through his job as a police officer.
For example, between March 2023 and May 2023, Terranova targeted a boy who was the victim of a robbery and encountered the defendant at the 121st Precinct on Staten Island when he reported the crime. Terranova obtained the boy’s cellphone number from the robbery complaint in an NYPD database and messaged him: “Hey…it’s Chris Terranova the cop you met at the 121 that day with mom, i just wanted to reach out to see if you were doing ok after the incident, I hate seeing these things happen to good Guys like yourself.” In subsequent messages, Terranova inquired about the investigation, referred to his role as a police officer and asked the boy if he had any interest in the police department or its youth programs. Terranova also suggested, “If [sic] here too if you ever want to talk[.] I been through a lot myself over the years so just know that little bro.” The defendant then asked the boy to add him on “snap” or “the gram,” referring to Snapchat and Instagram. On Snapchat, Terranova began asking the boy sexually explicit questions, sent the boy a photograph of Terranova’s genitals and asked for a sexually explicit photograph of the boy. The boy informed his mother about the inappropriate messages and she reported the matter to police.
Terranova also engaged in hands-on sex acts with two of his minor victims. While giving an acquaintance’s son a ride home from a birthday party, Terranova brought the boy to a secluded location where he directed the victim to engage in sex acts with him.
The defendant met another victim, who lived in Texas, on social media. Terranova traveled to Texas at least 16 times to visit the boy and purchased a house in the boy’s neighborhood. In one message, Terranova stated: “You being with me. . . and making love to me is more than a sign of everything happens for a reason.” One reason the boy trusted Terranova was because the defendant had told him he was a police officer.
Terranova also met a 12-year-old victim locally while the defendant was on-duty. Terranova messaged the boy later on Snapchat and began asking him sexually explicit questions and solicited sexually explicit photos.
The government’s case is being handled by the Office’s Civil Rights Section. Assistant United States Attorneys Rachel A. Bennek and Lauren A. Bowman are in charge of the prosecution, with the assistance of Paralegal Specialist Chelsea Guzman.
The Defendant:
CHRISTOPHER TERRANOVA
Age: 34
Staten Island, New YorkE.D.N.Y. Docket No. 21-CR-516 (KAM)
Brooklyn Business Owner Convicted of Multi-Million Dollar Real Estate Fraud SchemeRead the Press Release
A federal jury in Brooklyn returned a guilty verdict yesterday against Avraham Tarshish for conspiracy to commit wire fraud and bank fraud, and related wire fraud counts, in connection with a scheme to defraud mortgage loan holders, including the Federal National Mortgage Association (Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie Mac) and other mortgage lending businesses. The verdict followed a 12-day trial before Chief United States District Judge Margo K. Brodie. When sentenced, the defendant faces up to 30 years in prison.
Breon Peace, United States Attorney for the Eastern District of New York, Robert Manchak, Special Agent in Charge, Federal Housing Finance Agency, Office of Inspector General, Northeast Region (FHFA-OIG), Vicky Vazquez, Special Agent in Charge, U.S. Department of Housing and Urban Development, Office of Inspector General, Northeast Region (HUD-OIG) and Thomas M. Fattorusso, Special Agent in Charge, Internal Revenue Service-Criminal Investigation, New York (IRS-CI) announced the verdict.
“The defendant defrauded taxpayer-funded mortgage loan holders out of millions of dollars and took advantage of programs designed to help distressed property owners in need,” stated United States Attorney Peace. “Short sale mortgage fraud not only harms lending intuitions, it also depresses real estate values throughout our neighborhoods and prevents community members from gaining fair access to housing. Today’s guilty verdict should serve as a reminder that my Office, together with our law enforcement partners, will continue to vigorously prosecute those who corruptly line their pockets at the expense of mortgage lenders and borrowers.”
Mr. Peace expressed his appreciation to the United States Department of Homeland Security, Homeland Security Investigations, New York Field Office (HSI), and the HSI El Dorado Financial Crimes Task Force for their work on the case.
“The defendant and his co-conspirators corrupted a process meant to assist homeowners facing foreclosure. By undermining the integrity of this process, Fannie Mae, Freddie Mac, and other lenders were deprived of millions of dollars,” said Robert Manchak, Special Agent-in-Charge of FHFA-OIG’s Northeast Region. “Today's verdict demonstrates the resolve of the Federal Housing Finance Agency Office of Inspector General and its law enforcement partners to pursue those who defraud the government-sponsored enterprises.”
“Tarshish and other co-conspirators engaged in a $2.4 million scheme to cause FHA-insured mortgage lenders to approve short sale transactions at fraudulently depressed prices by misrepresenting material information for his own enrichment,” said Special Agent-in-Charge Vicky Vazquez with the U.S. Department of Housing and Urban Development (HUD), Office of Inspector General (OIG). “No one is above the law. HUD OIG will continue to work with the U.S. Attorney’s Office and our law enforcement partners to investigate individuals who jeopardize the integrity of FHA mortgage programs.”
“In this elaborate scheme to prey on people facing foreclosure and manipulating the mortgage loan system, Tarshish’s fraud resulted in a multi-million dollar loss to his victims. With this conviction, Tarshish now faces time behind bars where he can longer line his pockets at the expense of his community and their lenders,” said Thomas M. Fattorusso, Special Agent in Charge of IRS-CI New York.
The defendant was an employee of My Ideal Property Inc. and an owner of Exclusive Homes Realty Group, Inc., Exclusive Homes NY, LLC and Homeowners Solutions Group LTD, Queens- and Brooklyn-based companies formed to buy and sell real property. As proven at trial, between March 2013 and November 2018, the defendant and others conspired to defraud mortgage lenders, misleading them into approving short sale transactions at fraudulently depressed prices. In a short sale, with the approval of the mortgage lender or servicer, a mortgage loan borrower sells his or her property for less than the outstanding balance of the mortgage loan. The proceeds from the short sale, less approved closing costs, are applied to the outstanding mortgage loan balance owed to the lender, who typically agrees to forgive the borrower’s remaining mortgage loan balance. Here, the defendant fraudulently manipulated the short sale process and immediately flipped properties for prices well above the short sale prices.
Among other things, the defendant and his co-conspirators paid homeowners in foreclosure to lock them in to conducting short sales with them; took steps to preclude other prospective purchasers from making higher offers for properties by failing to market properties as required by the lenders; placed fraudulent liens on properties; and further depressed the properties’ values by removing toilets and plumbing, and causing other forms of property damage—a process that the defendant and his co-conspirators referred to as making the homes “pretty.” In furtherance of the scheme, the defendant and his co-conspirators also provided the mortgage lenders and servicers with false and misleading information in transaction documents and failed to disclose either payments made to the borrower and others related to short sale or contemporaneous agreements to transfer the properties at inflated prices. Many of the affected mortgage loans were insured by the Federal Housing Administration, or owned or guaranteed by Fannie Mae or Freddie Mac.
At trial, the government introduced evidence that the defendant participated in a conspiracy spanning years that involved dozens of fraudulent short sale transactions. From among those dozens of transactions, the government introduced specific evidence relating to eleven examples of Brooklyn short sales through which the defendant and his co-conspirators defrauded lenders and servicers of more than $2.4 million.
When sentenced, Aronov, Konstantinovskiy and Dafna face up to a 30-year max sentence. Herskowitz faces up to a 5-year sentence.
Anyone with information concerning similar mortgage-related fraud can report it by contacting the Federal Housing Finance Agency Office of Inspector General Hotline at 800-793-7724 or via the web at: https://www.fhfaoig.gov/ReportFraud#hotlineform.
In July 2022, Mr. Peace was selected as the Chairperson of the White Collar Fraud subcommittee for the Attorney General’s Advisory Committee (AGAC). As the leader of the subcommittee, Mr. Peace plays a key role in making recommendations to the AGAC to facilitate the prevention, investigation and prosecution of various financially motivated, non-violent crimes including bank fraud and wire fraud.
The government’s case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys Shannon C. Jones, John Vagelatos, Joshua B. Dugan and Russell Noble are in charge of the prosecution, with the assistance of Paralegal Specialist Liam McNett. Assistant United States Attorney Tanisha Payne of the Office’s Asset Recovery Section is handling forfeiture matters.
The Defendant:
AVRAHAM TARSHISH (also known as “Avi Tarshish”)
Age: 45
Queens Village, New YorkCo-Defendants Who Previously Pleaded Guilty:
ISKYO ARONOV (also known as “Isaac Aronov”)
Age: 37
Miami, FloridaMICHAEL KONSTANTINOVSKIY (also known as “Michael Kay”)
Age: 38
Rego Park, QueensTOMER DAFNA
Age: 53
Great Neck, New YorkMICHAEL HERSKOWITZ
Age: 45
Brooklyn, New YorkE.D.N.Y. Docket No. 19-CR-408 (MKB)
Two Former Employees of Brooklyn Based Non-Profit Charged with Fraud and Bribery OffensesRead the Press Release
Earlier today, in federal court in Brooklyn, an indictment was unsealed charging Gary DSilva, also known as “Pankaj DSilva,” Jonathan Velazquez and Luis A. Camarena with conspiracy to commit wire fraud, bribery and money laundering, as well as substantive counts of wire fraud and federal-program bribery, for their roles in a yearslong kickback scheme. The defendants were arraigned this afternoon before United States Magistrate Judge Vera M. Scanlon.
Breon Peace, United States Attorney for the Eastern District of New York, Jocelyn E. Strauber, Commissioner, New York City Department of Investigation (DOI) and James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the charges.
“These defendants misappropriated public funds through a brazen kickback scheme,” stated United States Attorney Peace. “When corrupt employees siphon public funds to line their own pockets, the neediest New Yorkers bear the brunt. My Office will relentlessly pursue those who try to compromise the integrity of our community organizations.”
DOI Commissioner Jocelyn E. Strauber said, “These employees of a City-funded nonprofit participated in an illegal kickback scheme, enriching themselves by stealing from their employer, an entity providing critical services to New Yorkers in need, as alleged in the indictment. Theft of precious public funds deprives deserving members of our community of resources and I am thankful to the U.S. Attorney’s Office for the Eastern District of New York and the FBI for their shared commitment to protect those funds for the benefit of their intended recipients.”
“Gary DSilva and Jonathan Velazquez, two non-profit organization workers, allegedly received more than $500,000 in illicit kickback payments from Luis Camarena, a contractor hired to install security services in some of the city’s homeless shelters. This alleged quid pro quo agreement only enriched the involved parties and deprived the city of vital infrastructural improvements. The FBI will never tolerate corrupt individuals who selfishly steal public funds intended to support our city’s vulnerable populations,” stated FBI Assistant Director in Charge Dennehy.
As alleged in the indictment, DSilva and Velazquez were employed in the Management Information Systems department of a Brooklyn-based non-profit entity (the Organization) that supplied a number of services to indigent New Yorkers, including administering multiple homeless shelters. DSilva and Velazquez, as part of their work for the Organization, were responsible for soliciting vendors to complete various projects involving information technology. DSilva solicited bids from one such vendor (the Vendor) for multiple projects involving the installation or replacement of security cameras at the Organization’s homeless shelters. Camarena was the principal of the Vendor. The Vendor ultimately received approximately $1.6 million in payments from the Organization for work related to these security-camera projects from approximately 2017 to 2021. During that same period, the Vendor paid a total of over $500,000 in kickbacks to DSilva and Velazquez. These illegal payments took the form of payments to credit cards in the names of DSilva and Velazquez and their spouses and payments to shell companies registered to DSilva’s spouse. In one email obtained during the investigation, Camarena, DSilva, and Velazquez discussed how they would divide the “profit” from the business the Vendor received from the Organization among themselves.
The charges in the indictment are allegations and the defendants are presumed innocent unless and until proven guilty.
In July 2022, Mr. Peace was selected as the Chairperson of the White Collar Fraud subcommittee for the Attorney General’s Advisory Committee (AGAC). As the leader of the subcommittee, Mr. Peace plays a key role in making recommendations to the AGAC to facilitate the prevention, investigation and prosecution of various financially motivated, non-violent crimes.
The government’s case is being handled by the Office’s Public Integrity Section. Assistant United States Attorneys Laura Zuckerwise and Turner Buford are in charge of the prosecution, with assistance from Paralegal Specialist Kavya Kannan.
The Defendants:
Gary DSilva (also known as “Pankaj DSilva”)
Age: 46
Manalapan, New JerseyJonathan Velazquez
Age: 54
Massapequa Park, New YorkLuis A. Camerena
Age: 57
Jackson Township, New JerseyE.D.N.Y. Docket No. 24-CR-471 (HG)
24-cr-471_gary_dsilva_et_al_indictment.pdfSenior FARC Commander Sentenced to 21 Years in Prison for International Cocaine Distribution ConspiracyRead the Press Release
Earlier today, at the federal courthouse in Brooklyn, Martin Leonel Perez Castro, a senior leader within the Revolutionary Armed Forces of Colombia (the FARC), was sentenced by United States District Judge Brian M. Cogan to 252 months in prison for conspiring to distribute cocaine internationally, intending and knowing that the cocaine would be illegally imported into the United States. Perez Castro pleaded guilty to the charge in August 2023. The defendant was also ordered to forfeit $1 million in drug proceeds.
Breon Peace, United States Attorney for the Eastern District of New York, Frank A. Tarentino III, Special Agent in Charge, Drug Enforcement Administration, New York Division (DEA), and Thomas M. Fattorusso, Special Agent in Charge, Internal Revenue Service Criminal Investigation, New York Field Office (IRS-CI), announced the sentence.
“The defendant extracted millions of dollars from drug traffickers at the point of a gun, funding the FARC’s acts of terrorism and facilitating the global cocaine trade,” stated United States Attorney Peace. “Today’s sentence handed down in a U.S. courtroom is fitting justice for Perez Castro, who granted drug traffickers his permission and protection to produce massive quantities of cocaine that was distributed in our country and elsewhere, causing incalculable harm. The dismantling of international drug trafficking organizations and narcoterrorism groups will always be a priority of the Department of Justice.”
Mr. Peace extended his appreciation to the DEA’s office in Bogota, Colombia, the United States Department of State, the Justice Department’s Office of International Affairs and the Narcotic and Dangerous Drug Section’s Office of the Judicial Attaché at the U.S. Embassy in Bogota provided critical assistance in securing the arrest and extradition of Perez Castro, the Colombian National Police and the Government of Colombia.
“Today, justice has been delivered. Martin Leonel Perez Castro, who served as a former senior member and one of the highest-level drug trafficking members of the FARC, used violent tactics, which included terrorism, to help distribute shipments of cocaine from Columbia to New York City and the United States” stated Special Agent in Charge Frank Tarentino. “While this sentencing closes the door to Mr. Castro’s activities, the DEA and our law enforcement partners, both globally and here in the United States, remain committed to making sure those who use violent and terrorist acts as a measure for illicit drug trade face the justice they deserve.”
“As a FARC senior official, Perez Castro was responsible for the distribution of more than 165,000 pounds of cocaine. He helped create a revenue stream that funded the FARC’s decades-long campaign to overthrow the Government of Colombia, a conflict that resulted in far too many casualties. Today’s sentencing is the result of the incredible investigative work of DEA and IRS-CI Special Agents and committed law enforcement partnerships globally,” stated IRS-CI New York Special Agent in Charge Fattorusso.
The FARC was founded in 1964 as a left-wing paramilitary group dedicated to the violent overthrow of the Government of Colombia. Over decades of conflict, the FARC attacked Colombian government forces and used targeted killings, kidnapping and other terrorist tactics to achieve its ends. In October 1997, the U.S. Secretary of State designated the FARC as a foreign terrorist organization (FTO). After the Government of Colombia and the FARC entered into a peace accord in 2016, the FARC formally dissolved. On November 30, 2021, the U.S. Secretary of State revoked the designation of the FARC as an FTO. The defendant’s conduct occurred prior to the 2016 peace accord.
Perez Castro was the Head of Finances for the FARC’s 30th Front, a group that operated in southwestern Colombia. The 30th Front extorted drug traffickers by forcing them to pay “taxes” for every kilogram of cocaine trafficked through the 30th Front’s territory. The 30th Front also sometimes produced its own cocaine or held ownership stakes in cocaine shipments produced by local traffickers. Cocaine revenues funded the FARC’s decades-long campaign to overthrow the Government of Colombia, a conflict that resulted in hundreds of thousands of casualties. Perez Castro was responsible for the distribution of at least 75,000 kilograms of cocaine. He was extradited to the Eastern District of New York in June 2022.
The conviction and sentencing of Perez Castro are the result of an ongoing Organized Crime Drug Enforcement Task Forces (OCDETF) investigation led by the Office and the DEA. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply. OCDETF uses a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state and local law enforcement agencies against criminal networks.
The government’s case is being handled by the Office’s International Narcotics and Money Laundering Section. Assistant United States Attorney Andrew D. Wang is in charge of the prosecution.
The Defendant:
MARTIN LEONEL PEREZ CASTRO
Age: 53
ColombiaE.D.N.Y. Docket No. 14-CR-465 (S-2) (BMC)
Former NYPD Officer Turned Forex Investment Fund Operator Pleads Guilty to Conspiracy to Commit Wire FraudRead the Press Release
Yesterday, in federal court in Brooklyn, former New York Police Department (NYPD) officer Jason Rodriguez pleaded guilty to conspiracy to commit wire fraud related to his role as the Chief Operating Officer of Technical Trading Team, LLC (Technical Trading Team). The proceeding was held before United States District Judge Ramon E. Reyes, Jr.
Breon Peace, United States Attorney for the Eastern District of New York and James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the guilty plea.
“With this guilty plea, the defendant has accepted responsibility for taking advantage of close friends and family members and defrauding them out of millions of dollars,” stated United States Attorney Peace. “The defendant deceived retail investors into investing with his company based on false promises that he would invest their money in accordance with clear guardrails and that he had left the NYPD because of his success as a trader. In reality, there were no guardrails, he resigned from the NYPD in disgrace, and he lost most of the money, inflicting substantial harm on his victims.”
According to the indictment, Rodriguez founded Technical Trading Team in April 2020. Rodriguez, who served as Chief Operating Officer, pitched the fund as focused on foreign exchange (forex) investment, and represented that he was in charge of all trading. Rodriguez promised investors that Technical Trading Team would have a “loss reserve account” that could be used to repay investors if the company lost money trading; that Rodriguez would never risk more than 1% of assets under management on any single trade; and that he would not hold positions open overnight. Each of these promises was meant to assure investors that their investments would be safe. However, Rodriguez and Technical Trading Team broke all of these promises, and as Rodriguez lost more and more money in the forex markets, he used new investor money to pay older investors the promised investment returns. In total, between April 2020 and September 2022, Rodriguez solicited approximately $4.8 million in investor funds that were wired to accounts he controlled; to date, approximately $3.5 million of those funds have not been paid back to the investors.
Prior to founding Technical Trading Team, Rodriguez served as an NYPD officer for approximately seven years. During the solicitation process, Rodriguez told prospective Technical Trading Team investors that he had quit the NYPD because he had become so successful at forex trading. The Technical Trading Team presentation similarly represented that Rodriguez’s “zealous ambition for trading took precedence resulting in the end of his law enforcement career.” However, Rodriguez failed to disclose that he resigned from the NYPD after pleading guilty to a misdemeanor crime and incurring several disciplinary infractions.
In July 2022, Mr. Peace was selected as the Chairperson of the White Collar Fraud subcommittee for the Attorney General’s Advisory Committee (AGAC). As the leader of the subcommittee, Mr. Peace plays a key role in making recommendations to the AGAC to facilitate the prevention, investigation and prosecution of various financially motivated, non-violent crimes including securities fraud, wire fraud and money laundering, as charged here.
The government’s case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorney Benjamin Weintraub is in charge of the prosecution, with the assistance of Paralegal Special Liam McNett.
The Defendant:
JASON RODRIGUEZ
Age: 38
Bellerose, QueensE.D.N.Y. Docket No. 24-CR-079 (RER)
Colombian Drug Kingpin Known as “Don T” Sentenced to 20 Years in Prison for International Cocaine Distribution ConspiracyRead the Press Release
Earlier today, at the federal courthouse in Brooklyn, Tito Aldemar Ruano Yandun, also known as “Don T,” “Don Ti,” “Don Tito,” “Pedro Linares,” “Pedro AK2,” “Santos,” “Don Tuma,” “Viejo” and “Viejo Loco,” was sentenced by United States District Court Judge William F. Kuntz, II to 20 years in prison for leading an international cocaine distribution conspiracy. Ruano Yandun pleaded guilty to the charge in March 2024. The defendant was also ordered to forfeit $1.5 million in drug proceeds.
Breon Peace, United States Attorney for the Eastern District of New York, and Frank A. Tarentino III, Special Agent in Charge, Drug Enforcement Administration, New York Division (DEA), announced the sentence.
“Today’s sentence significantly punishes the defendant for leading a prolific drug trafficking organization that exported thousands of kilograms of cocaine destined for our streets,” stated United States Attorney Peace. “International drug kingpins must face American justice for the misery they have caused in our district and country.”
Mr. Peace extended his appreciation to the DEA’s office in Bogota, Colombia, the United States Department of State, the Department of Justice’s Office of International Affairs, the Colombian National Police and the Government of Colombia.
As detailed in court documents, the defendant led a sophisticated drug trafficking organization that operated in southwestern Colombia and Ecuador. His organization regularly exported multi-ton quantities of cocaine to Central America and Mexico so that it could eventually be smuggled into the United States. The defendant’s drug trafficking organization trafficked cocaine on behalf of the Revolutionary Armed Forces of Colombia (i.e., the FARC), helping to fund the FARC’s long-running campaign to overthrow the Government of Colombia.
During the investigation, foreign and U.S. authorities seized thousands of kilograms of cocaine that were being transported by members of the defendant’s organization.
In November 2017, pursuant to the Foreign Narcotics Kingpin Designation Act, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated Ruano Yandun and his organization as Specially Designated Narcotics Traffickers for their significant role in international narcotics trafficking. At the time of the designation, OFAC stated that Ruano Yandun’s organization was “a key contributor to the increased cocaine production in the Nariño department of Colombia in recent years.” Ruano Yandun was extradited to the Eastern District of New York in October 2023.
The conviction and sentencing of Ruano Yandun are the result of an ongoing Organized Crime Drug Enforcement Task Forces (OCDETF) investigation led by the Office and the DEA. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply. OCDETF uses a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state and local law enforcement agencies against criminal networks.
The government’s case is being handled by the Office’s International Narcotics and Money Laundering Section. Assistant United States Attorney Andrew D. Wang is in charge of the prosecution.
The Defendant:
TITO ALDEMAR RUANO YANDUN (also known as “Don T,” “Don Ti,” “Don Tito,” “Pedro Linares,” “Pedro AK2,” “Santos,” “Don Tuma,” “Viejo” and “Viejo Loco”)
Age: 49
ColombiaE.D.N.Y. Docket No. 17-CR-27 (WFK)
Billionaire Chairman of Conglomerate and Seven Other Senior Business Executives Indicted in Connection with Scheme to Pay Hundreds of Millions of Dollars in Bribes and Conceal Bribery Scheme from U.S. InvestorsRead the Press Release
A five-count criminal indictment was unsealed today in federal court in Brooklyn charging Gautam S. Adani, Sagar R. Adani and Vneet S. Jaain, executives of an Indian renewable-energy company (the Indian Energy Company), with conspiracies to commit securities and wire fraud and substantive securities fraud for their roles in a multi-billion-dollar scheme to obtain funds from U.S. investors and global financial institutions on the basis of false and misleading statements. The indictment also charges Ranjit Gupta and Rupesh Agarwal, former executives of a renewable-energy company with securities that had traded on the New York Stock Exchange (the U.S. Issuer), and Cyril Cabanes, Saurabh Agarwal and Deepak Malhotra, former employees of a Canadian institutional investor, with conspiracy to violate the Foreign Corrupt Practices Act in connection with a bribery scheme also perpetrated by Gautam S. Adani, Sagar R. Adani and Vneet S. Jaain, involving one of the world’s largest solar energy projects.
Breon Peace, United States Attorney for the Eastern District of New York, Lisa H. Miller, Deputy Assistant Attorney General for the Justice Department’s Criminal Division and James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI) announced the charges.
“As alleged, the defendants orchestrated an elaborate scheme to bribe Indian government officials to secure contracts worth billions of dollars and Gautam S. Adani, Sagar R. Adani and Vneet S. Jaain lied about the bribery scheme as they sought to raise capital from U.S. and international investors,” stated United States Attorney Peace. “My Office is committed to rooting out corruption in the international marketplace and protecting investors from those who seek to enrich themselves at the expense of the integrity of our financial markets.”
“This indictment alleges schemes to pay over $250 million in bribes to Indian government officials, to lie to investors and banks to raise billions of dollars, and to obstruct justice,” stated Deputy Assistant Attorney General Miller. “These offenses were allegedly committed by senior executives and directors to obtain and finance massive state energy supply contracts through corruption and fraud at the expense of U.S. investors. The Criminal Division will continue to aggressively prosecute corrupt, deceptive, and obstructive conduct that violates U.S. law, no matter where in the world it occurs.”
“Gautam S. Adani and seven other business executives allegedly bribed the Indian government to finance lucrative contracts designed to benefit their businesses. Adani and other defendants also defrauded investors by raising capital on the basis of false statements about bribery and corruption, while still other defendants allegedly attempted to conceal the bribery conspiracy by obstructing the government’s investigation,” stated FBI Assistant Director in Charge Dennehy. “The FBI maintains its steadfast mission to expose all corrupt agreements, especially with international governments, and protect investors from related harm.”
As alleged in the indictment, between approximately 2020 and 2024, the defendants agreed to pay more than $250 million in bribes to Indian government officials to obtain lucrative solar energy supply contracts with the Indian government, which were projected to generate more than $2 billion in profits after tax over an approximately 20-year period (the Bribery Scheme). On several occasions, Gautam S. Adani personally met with an Indian government official to advance the Bribery Scheme, and the defendants held in-person meetings with each other to discuss aspects of its execution. The defendants frequently discussed their efforts in furtherance of the Bribery Scheme, including through an electronic messaging application. The defendants also extensively documented their corrupt efforts: for example, Sagar R. Adani used his cellular phone to track specific details of the bribes offered and promised to government officials; Vneet S. Jaain used his cellular phone to photograph a document summarizing various bribe amounts the U.S. Issuer owed the Indian Energy Company for its respective portion of the bribes; and Rupesh Agarwal prepared and distributed to other defendants multiple analyses using PowerPoint and Excel that summarized various options for paying and concealing bribe payments (Bribery Analyses).
During this same period, Gautam S. Adani, Sagar R. Adani and Vneet S. Jaain allegedly conspired to misrepresent the Indian Energy Company’s anti-bribery and corruption practices and conceal the Bribery Scheme from U.S. investors and international financial institutions in order to obtain financing, including to fund those solar energy supply contracts procured through bribery. As alleged, Gautam S. Adani, Sagar R. Adani and Vneet S. Jaain caused the Indian Energy Company and certain of its subsidiaries to raise capital on the basis of false and misleading statements in connection with (i) two U.S. dollar-denominated syndicate loans totaling more than $2 billion from lender groups comprised of international financial institutions and U.S.-based investors; and (ii) two Rule 144A bond offerings for more than $1 billion underwritten by international financial institutions, which were marketed and sold to investors in the U.S., among other places. In addition, Gautam S. Adani, Sagar R. Adani and Vneet S. Jaain caused the Indian Energy Company to make false statements in their consolidated financial statements and to the market and investors regarding the Bribery Scheme.
The indictment further alleges that Cyril Cabanes, Saurabh Agarwal, Deepak Malhotra and Rupesh Agarwal conspired to obstruct the grand jury, FBI and U.S. Securities and Exchange Commission (SEC) investigations into the Bribery Scheme. Among other things, those four defendants agreed to delete electronic materials related to the Bribery Scheme, including emails, electronic messages and Bribery Analyses; caused the U.S. Issuer’s Board of Directors to initiate an internal investigation into the Bribery Scheme and then withheld material information from that investigation; and falsely denied their participation in the Bribery Scheme to representatives of the FBI, DOJ and SEC at meetings in Brooklyn, New York. For this conduct, Cyril Cabanes, Saurabh Agarwal, Deepak Malhotra and Rupesh Agarwal are charged with conspiracy to obstruct justice.
The charges in the indictment are allegations and the defendants are presumed innocent unless and until proven guilty.
In July 2022, Mr. Peace was selected as the Chairperson of the White Collar Fraud subcommittee for the Attorney General’s Advisory Committee (AGAC). As the leader of the subcommittee, Mr. Peace plays a key role in making recommendations to the AGAC to facilitate the prevention, investigation and prosecution of various financially motivated, non-violent crimes including bribery and fraud.
The investigation was conducted by the FBI New York’s Corporate, Securities and Commodities Fraud and International Corruption Units. The government’s case is being handled by the Business and Securities Fraud Section of the U.S. Attorney’s Office for the Eastern District of New York and the Criminal Division’s Fraud Section. Assistant U.S. Attorneys Sarah M. Evans, Matthew R. Galeotti and Jessica K. Weigel of the Eastern District of New York, Shy Jackson of the Criminal Division, Fraud Section’s FCPA Unit and Andrew Tyler of the Fraud Section’s Market Integrity and Major Frauds Unit are prosecuting the case with assistance from Paralegal Specialists Liam McNett, Angelina Tyler and Nadiya Singh.
The Fraud Section is responsible for investigating and prosecuting FCPA and Foreign Extortion Prevention Act (FEPA) matters. Additional information about the Justice Department’s FCPA and FEPA enforcement efforts can be found at www.justice.gov/criminal-fraud/foreign-corrupt-practices-act.
The Department of Justice’s Office of International Affairs and the SEC’s New York Regional and Boston Regional offices provided valuable assistance during the investigation.
The Defendants:
GAUTAM S. ADANI
Age: 62
IndiaSAGAR S. ADANI
Age: 30
IndiaVNEET S. JAAIN
Age: 53
IndiaRANJIT GUPTA
Age: 54
IndiaCYRIL CABANES
Age: 50
France / AustraliaSAURABH AGARWAL
Age: 48
IndiaDEEPAK MALHOTRA
Age: 45
IndiaRUPESH AGARWAL
Age: 50
IndiaE.D.N.Y. Docket No. 24-CR-433 (NGG)
adani_et_al._indictment.pdfUpstate New York Resident and Bangladeshi National Charged with Digital Streaming Piracy SchemeRead the Press Release
Earlier today, in federal court in Brooklyn, an indictment was unsealed charging Noor Nabi Chowdhury and his brother, Mohammad Mahmudur Rahman, with conspiracy to provide to the public an illicit digital transmission service; providing an illicit digital transmission service; conspiracy to commit wire fraud; and aggravated identity theft. The charges stem from the defendants’ operation of 247TVStream, an online subscription-based service that permitted users to stream copyrighted content, such as live sports programming and television shows, without the permission of the relevant copyright owners. Chowdhury was arrested this morning and is scheduled to be arraigned this afternoon in the U.S. District Court for the Western District of New York. Rahman remains at large.
Breon Peace, United States Attorney for the Eastern District of New York, Nicole M. Argentieri, Principal Deputy Assistant Attorney General and head of the Criminal Division and William S. Walker, Special Agent in Charge, Homeland Security Investigations (HSI), New York, announced the arrest and indictment.
“As alleged, the defendants operated a bootleg online streaming service that distributed copyrighted television programs that they stole for their personal enrichment,” stated United States Attorney Peace. “My Office and the Department of Justice are committed to protecting the rights of intellectual property holders from digital pirates like these defendants.”
Mr. Peace expressed his thanks to the Justice Department’s Office of International Affairs, the Surrey and City of London Police, United Kingdom, Royal Canadian Mounted Police and Fiscale Inlichtingen- en Opsporingsdienst, Netherlands, and the United States Postal Inspection Service for their assistance.
“According to the indictment, Chowdhury and Rahman ran an illicit digital streaming site that infringed upon more than a hundred million dollars of intellectual property owned by legitimate copyright owners,” said Principal Deputy Assistant Attorney General Nicole M. Argentieri, head of the Justice Department’s Criminal Division. “Thanks to the work of our prosecutors, along with our domestic and international law enforcement partners, the illicit digital streaming site no longer exists, and Chowdhury is in custody. These actions demonstrate the Criminal Division’s commitment to protecting intellectual property rights by vigorously enforcing the laws against illicit digital transmission services.”
“Noor Nabi Chowdhury and Mohammad Rahman are accused of committing copyright infringement to the tune of over $100 million. As alleged and in furtherance of their criminal scheme, the defendants stole an unsuspecting victim’s identity to exploit major American businesses, in pursuit of illicit wealth,” stated HSI New York Special Agent in Charge Walker. “HSI New York proudly stands alongside our law enforcement and private sector partners, both domestic and abroad, to thwart criminal organizations who seek to financially capitalize on their wrongdoing.”
As alleged, between approximately May 2017 and November 2024, the defendants operated 247TVStream, a service that provided online video and sports streaming services. For a subscription fee of as little as $10 per month, 247TVStream enabled its subscribers to view live television and sports programming on their internet-connected devices. However, unlike legitimate streaming services, 247TVStream had not licensed the right to access those programs from the platforms on which they were legitimately offered.
The estimated economic harm caused by 247TVStream to television program copyright owners, as well as licensed streaming services, is more than $100 million.
In connection with this case, a seizure order was executed against website domain names used by Chowdhury and Rahman to operate 247TVStream. The seizure of these domains by the government will prevent the use of these sites to operate 247TVStream.
Individuals, including subscribers, visiting those sites will now see messages indicating that the sites have been seized by the federal government. In addition, in coordination with international law enforcement partners to enforce criminal copyright laws, Dutch and U.K. partners have seized the servers hosting a portion of the 247TVStream infrastructure.
The charges in the indictment are allegations, and the defendants are presumed innocent unless and until proven guilty.
If convicted, Chowdhury and Rahman each face a maximum penalty of five years in prison on the conspiracy to provide the digital transmission service; three years in prison on providing the digital transmission service; 20 years in prison for the conspiracy to commit wire fraud; and a mandatory term of two years in prison for aggravated identity theft, to run consecutive to the other sentences.
The HSI New York Field Office is investigating the case, with assistance from the HSI Buffalo Field Office and their Attaché Offices in Ottawa, The Hague and London.
Assistant United States Attorney Rebecca Schuman is prosecuting the case with Trial Attorneys Vasantha Rao and Jeff Pearlman of the Criminal Division’s Computer Crime and Intellectual Property Section.
The Defendants:
NOOR NABI CHOWDHURY
Age: 56
Cheektowaga, New YorkMOHAMMAD MAHMUDUR RAHMAN
Age: 36
Dhaka, BangladeshE.D.N.Y. Docket No.: 24-CR-466 (MKB)
24-cr-466_-_indictment.pdfManager and Enforcer of Queens-Based Sex Trafficking Ring Convicted of Felony Charges Including Assault In-Aid-Of Racketeering and Hobbs Act RobberyRead the Press Release
A federal jury in Brooklyn yesterday returned guilty verdicts on all counts against Siyang Chen and Yichu Chen in connection with their roles in a Queens-based sex trafficking and prostitution ring. The jury convicted Siyang Chen of sex trafficking conspiracy, several assaults in-aid-of racketeering and Hobbs Act robbery conspiracy. The jury convicted Yichu Chen of the robbery and assault of a sex worker in Centreville, Virginia on September 15, 2020. The verdict followed a month-long trial before United States District Judge Eric N. Vitaliano. Prior to the trial, on September 27, 2024, Siyang Chen pleaded guilty to nine counts in the superseding indictment, including racketeering conspiracy and assaults in-aid-of racketeering, and, during trial, on October 22, 2024, to an additional count of assault in-aid-of racketeering. With this verdict Siyang Chen has now been convicted on all counts in the superseding indictment with which he was charged. When sentenced, Siyang Chen faces up to life in prison and Yichu Chen faces up to 20 years in prison.
Breon Peace, United States Attorney for the Eastern District of New York; James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI); and Thomas G. Donlon, Interim Commissioner, New York City Police Department (NYPD), announced the verdict.
“The trial evidence provided a behind-the-scenes view of the horrific machinations of a sex trafficking organization in all its inhumanity and violence motivated by greed,” stated United States Attorney Peace. “This verdict is a victory for justice and for the victims who were subjected to brutal beatings and degrading treatment at the hands of the defendants. My Office will stand by the brave victims who assisted prosecutors and law enforcement in holding the perpetrators accountable.”
Mr. Peace expressed his thanks to the United States Attorney’s Office for the District of Nebraska, the Oklahoma City and Manchester field offices of the Department of Homeland Security, Homeland Security Investigations, and United States Immigration and Customs Enforcement. In addition, local police departments across the United States provided invaluable assistance, including the Beaverton (Oregon) Police Department, the Michigan State Police, the Missouri Highway Patrol, the Oklahoma City (Oklahoma) Police Department, the Omaha (Nebraska) Police Department, the Overland Park (Kansas) Police Department, the Portland (Oregon) Police Department, the Southfield (Michigan) Police Department and the Troy (Michigan) Police Department.
“For three years, Siyang Chen managed a national sex trafficking operation designed to establish a monopoly over their victimized workers through organized attacks, effected by Yichu Chen, among others, to terrorize potential defectors and competitors. This ruthless enterprise ordered brutal assaults with physical restraints and various blunt instruments to maintain its tyrannical control. May this conviction emphasize the FBI’s intolerance of the systemic use of violence and serve as a deterrent to those who employ such horrific measures to increase profits,” stated FBI Assistant Director in Charge Dennehy.
“This verdict delivers a modicum of justice to the courageous survivors who endured unconscionable treatment at the hands of these men, who have now been convicted of operating a brutal interstate sex trafficking and prostitution enterprise,” stated NYPD Interim Commissioner Donlon. “The NYPD, along with our federal, state, and local law enforcement partners, will continue to hold accountable those who seek to profit from the abuse and exploitation of others.”As proven at trial, between April 2019 and September 2021, defendant Siyang Chen helped lead a nationwide prostitution business that trafficked women. Members of the organization directed and carried out violent attacks on commercial sex workers to protect the enterprise’s turf and deter the victims from working for rival organizations or independently. Siyang Chen was a manager of the criminal enterprise, who advised the organization on strategies to improve profits, including by using violence—and specifically, by targeting and attacking sex workers. The victims of the organization were subjected to extreme brutality. Evidence admitted at trial demonstrated that members of the organization zip-tied the victims’ hands and viciously beat them with breaker bars, hammers, wrenches, and other blunt objects, leaving the victims bloody, terrified, and, in many cases, seriously injured.
Siyang Chen planned and participated in robberies and assaults across several states. WeChat messages shared among members of the ring graphically depicted violence that occurred during the assaults. Videos of the assaults were circulated to senior members of the enterprise to show that the beatings were sufficiently severe and to sex workers to cultivate an atmosphere of fear. The videos showed victims screaming, struggling while they were bound, bleeding and being beaten with hammers and other blunt weapons. Siyang Chen commented in a message about a planned attack: “beat to the death [] at least 4 fractures ... Tell the girl not allowed back will hit again coming back.” He made clear that his message to sex workers was, “Fuck off if you don’t want to die.”
Yichu Chen was part of the organization’s “hit team.” Specifically, acting at Siyan Chen’s direction, Yichu Chen was recruited to beat a woman who was engaging in commercial sex work for a rival prostitution business at a location in Centreville, Virginia. Siyang Chen instructed Yichu Chen how to zip-tie the woman’s wrists behind her back and, subsequently, Yichu Chen beat her with a metal breaker bar. Yichu Chen robbed the victim of money and a cell phone. Members of the organization paid Yichu Chen an additional $400 for carrying out the attack, which a member of the organization contemporaneously described as a “super severe” beating.
Ten co-defendants charged in the superseding indictment have pleaded guilty to various charges for their roles in the organization, including its boss and Siyang Chen’s wife, Rong Rong Xu, and are currently awaiting sentencing. Four others that committed crimes at the enterprise’s direction have been convicted in related cases and are awaiting sentencing.
The government’s case is being prosecuted by the Office’s Organized Crime and Gangs and Civil Rights Sections. Assistant United States Attorneys Matthew R. Galeotti, Sophia M. Suarez and Stephanie Pak are in charge of the prosecution, with the assistance of Paralegal Specialist Anna November.
The Defendants:
SIYANG CHEN
Age: 35
Queens, New YorkYICHU CHEN (also known as “Ban Ban”)
Age: 22
Queens, New York
Defendants Who Previously Pleaded Guilty:RONG RONG XU (also known as “Eleanor”)
Age: 31
Queens, New YorkYUAN YUAN CHEN
Age: 31
Queens, New YorkBO JIANG
Age: 29
Queens, New York
MEIZHEN SONG (also known as “Die Die”)
Age: 25
Dallas, Texas
JIARUN YAN (also known as “Raymond Yan” and “Mike”)
Age: 31
Queens, New YorkJILONG YU
Age: 26
Dallas, Texas
CARLOS CURY
Age: 43
Queens, New YorkZERONG TANG
Age: 26
Queens, New YorkE.D.N.Y. Docket No.: 22-CR-158 (S-1) (ENV)
Brothers Residing in New York and Bangladesh Charged with Running Digital Streaming Piracy SchemeRead the Press Release
On Nov. 15, a federal grand jury in the Eastern District of New York returned an indictment charging Noor Nabi Chowdhury, 56, of Cheektowaga, New York, and his brother, Mohammad Rahman, 36, of Dhaka, Bangladesh, with conspiracy to provide to the public an illicit digital transmission service; providing an illicit digital transmission service; conspiracy to commit wire fraud; and aggravated identity theft. The charges stem from their operation of 247TVStream, an online subscription-based service that permitted users to stream copyrighted content, such as live sports programming and television shows, without the permission of the relevant copyright owners.
According to court documents, Chowdhury and Rahman allegedly ran the illegal scheme for years and collected more than $7 million in subscriber fees from 247TVStream subscribers. The estimated harm to legitimate copyright owners caused by 247TVStream is more than $100 million. Chowdhury and Rahman also allegedly used a victim’s identification to facilitate the infrastructure for the scheme.
The indictment was unsealed earlier today, following Chowdhury’s arrest, and he appeared for his arraignment in the U.S. District Court for the Western District of New York this afternoon. An arrest warrant was issued for Rahman, who remains at large.
“According to the indictment, Chowdhury and Rahman ran an illicit digital streaming site that infringed upon more than a hundred million dollars of intellectual property owned by legitimate copyright owners,” said Principal Deputy Assistant Attorney General Nicole M. Argentieri, head of the Justice Department’s Criminal Division. “Thanks to the work of our prosecutors, along with our domestic and international law enforcement partners, the illicit digital streaming site no longer exists, and Chowdhury is in custody. These actions demonstrate the Criminal Division’s commitment to protecting intellectual property rights by vigorously enforcing the laws against illicit digital transmission services.”
“As alleged, the defendants operated a bootleg online streaming service that distributed copyrighted television programs that they stole for their personal enrichment,” said U.S. Attorney Breon Peace for the Eastern District of New York. “My office and the Justice Department are committed to protecting the rights of intellectual property holders from digital pirates like these defendants.”
“Noor Nabi Chowdhury and Mohammad Rahman are accused of committing copyright infringement to the tune of over $100 million,” said Special Agent in Charge William S. Walker of the Homeland Security Investigations (HSI) New York Field Office. “As alleged and in furtherance of their criminal scheme, the defendants stole an unsuspecting victim’s identity to exploit major American businesses, in pursuit of illicit wealth. HSI New York proudly stands alongside our law enforcement and private sector partners, both domestic and abroad, to thwart criminal organizations who seek to financially capitalize on their wrongdoing.”
Also today, HSI executed a seizure order from the Eastern District of New York against website domain names used by Chowdhury and Rahman to operate 247TVStream. The seizure of these domains by the government will prevent the owners and third parties from using the sites to operate 247TVStream. Individuals, including subscribers, visiting those sites now will see a message indicating that the site has been seized by the federal government. In addition, in coordination with international law enforcement partners to enforce criminal copyright laws, Dutch and United Kingdom authorities have seized the servers hosting a portion of the 247TVStream infrastructure.
If convicted, Chowdhury and Rahman each face a maximum penalty of five years in prison on the conspiracy to provide the illicit digital transmission service charge; three years in prison on the providing the illicit digital transmission service charge; 20 years in prison for the conspiracy to commit wire fraud charge; and a mandatory penalty of two years in prison for aggravated identity theft, to run consecutive to the other sentences.
The HSI New York Field Office is investigating the case, with assistance from the HSI Buffalo Field Office and their Attaché Offices in Ottawa, The Hague, and London.
The Justice Department’s Office of International Affairs also assisted. The Justice Department appreciates the additional assistance provided by the Surrey and City of London Police of the United Kingdom, Royal Canadian Mounted Police, and Fiscale inlichtingen- en opsporingsdienst of the Netherlands.
Trial Attorneys Vasantha Rao and Jeff Pearlman of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Rebecca Schuman for the Eastern District of New York are prosecuting the case.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Staten Island Crips Gang Member Pleads Guilty to Coercion and Enticement of a Minor and Being a Felon in Possession of a FirearmRead the Press Release
Earlier today, in federal court in Brooklyn, Justin Dixon pleaded guilty to coercion and enticement of a minor and to being a felon in possession of a firearm. The proceeding was held before United States District Judge William F. Kuntz II. When sentenced, Dixon faces a mandatory minimum term of 10 years in prison and a maximum of life in prison.
Breon Peace, United States Attorney for the Eastern District of New York; James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI); and Thomas G. Donlon, Interim Commissioner, New York City Police Department (NYPD), announced the guilty plea.
“With today’s guilty plea, the defendant has added directing the prostitution of a minor and being a felon in possession of a firearm to his criminal history, and he will face the consequences for his lack of respect for the law,” stated United States Attorney Peace. “The Penn Track is a blight on our district, and predators like the defendant who operate there are going to be held accountable by my Office and our law enforcement partners for their ruthless exploitation of women and minors.”
Mr. Peace expressed his appreciation to the Richmond County District Attorney’s Office for their assistance during the investigation.
“Justin Dixon trafficked a 14-year-old girl, along with several other women, for commercial sex and issued violent punishments to ensure adherence to his demeaning rules. Dixon’s twisted ruse allowed him to groom victims before forcing them into sexual servitude on the infamous Penn Track where profits are valued over bodily autonomy. The FBI will continue its mission apprehending predators who prey upon innocent populations out of financial greed,” stated FBI Assistant Director in Charge Dennehy.
“Today’s guilty plea sends a powerful message that crimes against our most vulnerable population, our children, will not be tolerated in our city,” stated NYPD Interim Commissioner Donlon. “It also reaffirms the unwavering dedication of law enforcement to ensure public safety for all New Yorkers. I commend our investigators, as well as our partners at the FBI and the office of the U.S. Attorney for the Eastern District of New York, for their relentless efforts in combating the scourge of sex trafficking. Their determination to hold Mr. Dixon accountable for his actions and to obtain justice for the survivors of these horrific crimes is truly commendable.”
As set forth in court filings, in January 2023, Dixon used violence and threats of violence to compel a 14-year-old minor (Jane Doe) to engage in commercial sex for the defendant’s financial benefit. Dixon transported the minor victim—as well as other women—to an area in East New York, Brooklyn near Pennsylvania Avenue, which is known as the “Penn Track” or the “Blade.” Dixon forced Jane Doe and other women to engage in prostitution and demanded that the proceeds of their sex work be turned over to him. Any resistance from the victims was met with violence. During this time period, the defendant was affiliated with the Crips street gang.
Dixon used social media and other internet applications to establish relationships with potential victims, groom them and manipulate them into working for him as prostitutes. Jane Doe was forced to live in a Staten Island house, along with Dixon and other women. Dixon required that Jane Doe and the other women clean the house, cook for him and bathe him. Dixon would not allow the women to be clothed inside the house and would physically punish the women if they disobeyed any of these rules.
Dixon called Jane Doe “tiny,” and told her that she needed to eat more food in order to look older than her age. The defendant also told Jane Doe that he was arranging a trip to Florida for her to have plastic surgery, including breast implants, to make her appear older.
Prior to his arrest, Dixon brandished firearms in the presence of Jane Doe and other victims. In January 2023, law enforcement officers executed a search warrant in connection with the investigation and recovered a defaced Ruger LCP .380 caliber handgun inside a vehicle used by Dixon to transport Jane Doe and other women to the Penn Track. Prior to possessing this firearm, Dixon had a felony conviction.
This prosecution is part of Project Safe Childhood, a nationwide initiative led by the Department of Justice to combat the epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov
The government’s case is being handled by the Office’s Civil Rights Section. Assistant United States Attorney Lorena Michelen is in charge of the prosecution.
The Defendant:
JUSTIN DIXON
Age: 33
Staten Island, New YorkE.D.N.Y. Docket No. 23-CR-090 (WFK)
Portfolio Manager of "A.I." Investment Fund Arrested for Stealing Fund AssetsRead the Press Release
Earlier today, at the federal court in Brooklyn, an indictment was unsealed charging Kanen Flowers with securities fraud, wire fraud and money laundering. He was arrested this morning in Tucson, Arizona and will be removed to the Eastern District of New York, at which time he will be arraigned on the indictment.
Breon Peace, United States Attorney for the Eastern District of New York and James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI) announced the charges.
“Flowers is charged with shamelessly lying to investors to get their money and capitalizing on disruptions in the cryptocurrency market to hide the fact that he had pilfered investor funds for his own benefit,” stated United States Attorney Peace. “Be it through crypto or traditional banking, my Office is committed to rooting out fraud and protecting our investing public.”
“As alleged, Kanen Flowers masqueraded the true composition of his fund to deceive and steal from his investors before diverting the misappropriated assets for personal use. The alleged scheme Flowers engaged in manipulated the good faith placed upon him to selfishly pocket substantial amounts of investments. The FBI will continue to dismantle all fraudulent conspiracies to ensure invested monies are duly managed,” stated FBI Assistant Director in Charge Dennehy.
As alleged in the indictment, from 2020 to 2023, Flowers was the Portfolio Manager of an “A.I.” fund that used “proprietary algorithms to actively trade long and short positions” (the “Fund”). He lied to investors and potential investors about the size of the Fund—claiming it was worth billions of dollars when it never had more than approximately $3.5 million in assets under management. He lied to investors and potential investors about the Fund’s diversification efforts—claiming it was trading in equal parts futures, equities and cryptocurrency, when just months after its formation it was trading more than 50% cryptocurrency and, later, entirely cryptocurrency. And he lied to investors about his alleged inability to liquidate the Fund when it ultimately shuttered—claiming cryptocurrency lenders and exchanges were capping withdrawals or had even confiscated Fund assets, when in fact Flowers had largely emptied the Fund’s accounts at those cryptocurrency lenders and exchanges months prior.
As further alleged in the indictment, Flowers stole Fund assets. Among other things, in October 2021, he used $70,000 worth of cryptocurrency from a Fund account to pay off a personal loan. Between December 2021 and January 2022, he transferred more than $200,000 worth of the Fund’s cryptocurrency to himself. And in January 2022, he caused the Fund to purchase a non-fungible token or NFT for over $100,000, which he then kept.
In July 2022, Mr. Peace was selected as the Chairperson of the White Collar Fraud subcommittee for the Attorney General’s Advisory Committee (AGAC). As the leader of the subcommittee, Mr. Peace plays a key role in making recommendations to the AGAC to facilitate the prevention, investigation and prosecution of various financially motivated, non-violent crimes including securities fraud, wire fraud and money laundering, as charged here.
The charges in the indictment are merely allegations and the defendant is presumed innocent unless and until proven guilty. If convicted of securities fraud and wire fraud, Flowers faces a 20-year statutory maximum sentence. If convicted of money laundering, Flowers faces a 10-year statutory maximum sentence.
The government’s case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorney Tara McGrath is in charge of the prosecution, with the assistance of Paralegal Specialist Liam McNett.
The Defendant:
KANEN FLOWERS
Age: 54
Atlanta, GeorgiaE.D.N.Y. Docket No. 24-CR-458
2024.11.12_-_indictment_flowers_as_filed.pdfMS-13 Gang Member Indicted for 2011 Murder of Queens ManRead the Press Release
Earlier today, Roger Morales, also known as “Crazy,” “Ciclon” and “Cyclone,” was arrested in connection with an indictment charging him with the June 5, 2011 murder in-aid-of racketeering of Norman Mizzell. Morales was arrested this morning and was arraigned this afternoon this afternoon before United States Magistrate Judge Robert M. Levy. Morales was ordered detained pending trial.
Breon Peace, United States Attorney for the Eastern District of New York, James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Thomas G. Donlon, Interim Commissioner, New York City Police Department (NYPD), announced the arrest and charges.
“As alleged, the defendant and his co-conspirators killed the victim for the twisted purpose of maintaining and increasing their positions in the MS-13 gang,” stated United States Attorney Peace. “This prosecution reflects the resolve by my Office and our law enforcement partners to bring gang members to justice for their violent crimes and that we will not be deterred by the passage of time.”
“In 2011, Roger Morales, a MS-13 member, allegedly determined murder as fitting retribution for Norman Mizzell advocating for himself after being previously burglarized by the same crew. This alleged cold-blooded execution highlights MS-13’s violent and mercurial intolerance for disrespect that threatens our community’s safety. With the assistance of our law enforcement partners, the FBI maintains its unwavering posture to eliminate all gang violence regardless of when that crime occurred.,” stated FBI Assistant Director in Charge Dennehy.
“The senseless violence described in the charges announced today has no place in New York City,” stated NYPD Interim Commissioner Donlon. “Our team of NYPD investigators, along with our partners at the FBI and the office of the U.S. Attorney for the Eastern District of New York, will continue to use all available resources to identify and dismantle street gangs, particularly the notoriously brutal MS-13, wherever they may be operating. This crucial effort will remain a top priority until every neighborhood in New York City is as safe as our safest community.”
As alleged in the government’s detention letter filed earlier today, Morales was a member of the Centrales Locos Salvatruchas clique of La Mara Salvatrucha, also known as the MS-13, in Queens, New York. In the spring of 2011, Morales and other members of MS-13 committed a burglary at the victim’s home where they had gone to purchase marijuana. They found that he was away, broke into the house and took his belongings. Later, the victim confronted Morales and his co-conspirators about the burglary, and they decided to kill him. The defendant and his co-conspirators obtained a firearm from another MS-3 clique and enlisted the help of another MS-13 member who needed to commit a murder to regain standing in the gang. Then, on the night of June 5, 2011, Morales and his co-conspirators traveled to the victim’s home, where they shot him several times through a window into his bedroom during a feigned late-night marijuana purchase. The victim’s body was found the next day.
The charge in the indictment is an allegation, and the defendant is presumed innocent unless and until proven guilty. If convicted of murder in-aid-of racketeering, Morales faces up to life in prison.
Today’s charges 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. Since 2003, hundreds of MS-13 members, including dozens of clique leaders, have been convicted on federal felony charges in the Eastern District of New York. A majority of those MS-13 members have been convicted on federal racketeering charges for participating in murders, attempted murders and assaults. Since 2009, this Office has obtained indictments charging MS-13 members with carrying out more than 70 murders in the district and has convicted dozens of MS-13 leaders and members in connection with those murders. These prosecutions are the product of investigations led by our law enforcement partners.
The government’s case is being handled by the Office’s Organized Crime and Gangs Section. Assistant United States Attorneys Kamil R. Ammari, Anna L. Karamigios, Jonathan Siegel and Michael W. Gibaldi are in charge of the prosecution.
The Defendant:
ROGER MORALES (also known as “Crazy,” “Ciclon” and “Cyclone”)
Age: 31
Ozone Park, QueensE.D.N.Y. Docket No.: 24-CR-453 (BMC)
Two Gang Members Charged with Armed Carjacking in Garden CityRead the Press Release
Earlier today, Abdoul Azika and Jaquell Blackwell were arrested in connection with a complaint charging them with armed carjacking. The defendants were arraigned this afternoon at the federal courthouse in Brooklyn before United States Magistrate Judge Taryn A. Merkl on the complaint and ordered detained.
Breon Peace, United States Attorney for the Eastern District of New York and James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI) announced the charges.
“For more than a year, Azika and Blackwell terrorized and traumatized innocent members of our community through a pattern of violent, armed carjackings,” stated United States Attorney Peace. “My Office, together with our law enforcement partners, will continue to work diligently to protect our communities from such violence.”
Mr. Peace thanked the Garden City Police Department, the Nassau County Police Department and the New York City Police Department for their assistance in the investigation.
“Abdoul Azika and Jaquell Blackwell, two Blood Hounds Brims gang members, allegedly demonstrated a pattern of violence and intimidation by forcing residents to surrender their vehicles at weapon-point. This alleged series of armed robberies incites fear and jeopardizes public safety. The FBI will continue to apprehend gang members who utilize violence to embolden their criminal activities and terrorize our communities,” stated FBI Assistant Director in Charge Dennehy.
As alleged in court filings, Azika and Blackwell were members of the violent “5zzly” crew of the Bronx-based Blood Hounds Brims gang that has engaged in a string of armed carjackings and robberies across New York City and Long Island. One such incident, as charged in the complaint, took place in the early morning hours of March 19, 2023, when Azika and Blackwell snuck up on and opened the doors of a vehicle parked in a residential neighborhood in Garden City, pointed a knife and a gun at the driver’s face, and told him to “get the f*** out of the car,” before driving off with the vehicle.
The charges in the complaint are allegations, and the defendants are presumed innocent until proven guilty. If convicted, the defendants face a maximum of 15 years’ imprisonment.
Assistant United States Attorneys Rebecca M. Schuman and Kamil R. Ammari are in charge of the prosecution with assistance from Paralegal Specialist Rachel Friedman.
The Defendants:
ABDOUL AZIKA
Age: 20
Bronx, New YorkJAQUELL BLACKWELL
Age: 19
Bronx, New YorkE.D.N.Y. Docket No. 24-MJ-598
Defendant Convicted of Sex Trafficking and Interstate Prostitution on Long Island and in Other StatesRead the Press Release
A federal jury in Central Islip today convicted Michail McKen of two counts of sex trafficking by force and two counts of interstate prostitution in connection with a sex trafficking business he operated in Suffolk and Nassau Counties, New York, Virginia, Arizona, Massachusetts and elsewhere. The verdict followed a six-day trial before United States District Judge Joan M. Azrack. When he is sentenced, McKen faces a mandatory minimum term of 15 years in prison and up to life in prison.
Breon Peace, United States Attorney for the Eastern District of New York, James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Robert Waring, Acting Commissioner, Suffolk County Police Department (SCPD), announced the verdict.
“The defendant stands convicted today of luring vulnerable women into his web of deceit and coercing them to have commercial sex with men all over the country, including on Long Island,” stated United States Attorney Peace. “He falsely promised his victims a better life, but instead controlled their lives with threats of violence and manipulation to enrich himself. Prosecuting sex traffickers like McKen is a priority of my Office and it is also my hope that today’s verdict brings some measure of consolation to survivors of this awful, exploitative crime.”
Mr. Peace expressed his appreciation to the Arizona Desert Hawk Violent Crime Task Force, the FBI’s Baltimore and Richmond Field Offices and the Henrico County, Virginia, Police Division for their assistance on the case.
FBI Assistant Director in Charge Dennehy stated, “For three years, Michail McKen established a national trafficking route to ensnare and force countless women into sexual slavery. False promises and deceit progressed into physical violence and degradation to ensure his victims remained captive. May today's conviction demonstrate the FBI's commitment to apprehending all individuals who implement perverted tactics to profit off another's body.”
As proven at trial, between 2019 and 2022, McKen was a pimp who used violence and threats of violence to coerce multiple women to engage in commercial sex acts for his own profit. McKen often recruited sex workers through social media and then caused them to travel to Long Island, where McKen is originally from, to engage in commercial sex acts in hotels and other locations. As part of his sex trafficking business, McKen sent his victims all over the country to engage in commercial sex acts, including Virginia, Massachusetts, Pennsylvania, Arizona, Kentucky, Alabama and Oregon. McKen enticed the victims with false promises of a better life and a lucrative partnership based on sharing illicit proceeds. He also choked, beat and threatened the victims at gunpoint to control them. Some of McKen’s victims suffered from drug addiction and he would maintain leverage over those victims by forcing them to engage in commercial sex acts in exchange for a rationed supply of opioids that would prevent them from going through complete withdrawal.McKen forced his victims to abide by strict rules, such as forbidding them from talking to other pimps or even making eye contact with other men in public and wearing lingerie under their street clothes, so they were always prepared for sex work. McKen also took identification documents from victims, which he held as ransom to prevent them from acting independently of him. One victim who testified at trial had the word “Cavalli,” the defendant’s street name which he adopted from the name of a famous fashion designer, tattooed across her ribcage.
The government’s case is being handled by the Criminal Section of the Office’s Long Island Division. Assistant United States Attorneys Megan E. Farrell and Samantha Alessi are in charge of the prosecution with the assistance of Paralegal Specialist Adam Bernard, Legal Assistant Hannah Valoy, and Victim Witness Specialist Stephanie Marroquin.
The Defendant:
MICHAIL MCKEN (also known as “Kells” and “Cavalli”)
Age: 36
Baldwin, New York and Phoenix, ArizonaE.D.N.Y. Docket No. 23-CR-377 (JMA)
Rapper Known as "Lil Zay Osama" Sentenced to 14 Months in Prison for Possessing an Illegal MachinegunRead the Press Release
Earlier today, at the federal courthouse in Brooklyn, Isaiah Dukes, also known as “Lil Zay Osama,” was sentenced by United States District Judge Nina R. Morrison to 14 months in prison and a $10,000 fine. Dukes was indicted in January 2024 for possession of a machinegun, and pleaded guilty in May 2024.
Breon Peace, United States Attorney for the Eastern District of New York, Bryan Miller, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives, New York Field Office (ATF), and Thomas G. Donlon, Interim Commissioner, New York City Police Department (NYPD) announced the sentence.
“The defendant knowingly carried a fully automatic weapon, a pistol with a switch device whose only purpose is to make a dangerous weapon all the more deadly – and then carelessly left that gun in the back of a rideshare,” stated United States Attorney Peace. “Today’s sentence serves as a warning that those who possess illegal guns, particularly with switches that convert those guns into machineguns, will be held accountable for their actions and for the danger they pose to our community.”
“This sentencing highlights a crucial point: possessing a machine gun conversion device is illegal under federal law. Machine gun conversion devices exponentially increase the lethality of firearms and put our communities in serious danger. Every device removed from our streets represents lives saved and tragedies prevented. The ATF's primary goal is safeguarding the public from violent crimes, and the removal of these devices significantly contributes to achieving this mission. We are grateful to the ATF NY Joint Firearms Task Force, NYPD, and EDNY for their dedicated efforts in this endeavor. ATF proudly collaborates with our law enforcement partners to eliminate these dangerous devices from our streets and ensure public safety,” stated ATF Special Agent in Charge Bryan Miller.
“Today’s sentence serves as a reminder to anyone who may bring an illegal firearm, especially one that has been modified to increase its lethality, into New York City: There are serious consequences for your reckless actions,” stated NYPD Interim Commissioner Donlon. “The NYPD and our law enforcement partners are fully committed to holding criminals accountable and ensuring the safety of our streets and communities for all New Yorkers.”
As set forth in the government’s sentencing memorandum and other court documents, on September 29, 2022, Dukes carried a loaded Glock pistol affixed with a switch — a device that when attached to the back of a handgun like a Glock converts the firearm into a fully automatic weapon. Dukes was arrested after leaving the firearm in a rideshare vehicle that brought him from a luxury hotel in Manhattan to a recording studio in Queens. Law enforcement subsequently determined that the firearm could automatically fire more than one round with a single function of the trigger, rendering it a machinegun.
Assistant United States Attorneys Gilbert M. Rein and Rebecca M. Schuman are in charge of the prosecution, with assistance from Paralegal Specialist Rachel Friedman.
The Defendant:
ISAIAH DUKES
Age: 27
Calumet City, IllinoisE.D.N.Y. Docket No. 24-CR-28 (NRM)
Businessman Pleads Guilty to Export, Tax Charges in Connection with Shipments of Other Sensitive Technology to RussiaRead the Press Release
Earlier today, in federal court in Brooklyn, Ilya Kahn, a national of the United States, Israel and Russia, pleaded guilty to conspiracy to violate the Export Control Reform Act for his role in a transnational, multi-million-dollar scheme to secure and illegally export dual-use semiconductors and other sensitive technology to Joint Stock Company Research and Development Center ELVEES (Elvees) and other entities in Russia. Elvees, one of the leading Russian developers of microchips, was sanctioned by the U.S. government in 2022 for contributing to Russia’s security services, military and defense sectors. Kahn also pleaded guilty to attempted tax evasion for failing to pay taxes on the illicit income he earned from the scheme. Kahn was arrested in January 2024.
The guilty pleas took place before United States District Judge Ann M. Donnelly. When sentenced, Khan faces up to 20 years in prison.
Breon Peace, United States Attorney for the Eastern District of New York, Matthew G. Olsen, Assistant Attorney General for the Justice Department’s National Security Division, James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI), Jonathan Carson, Special Agent in Charge, U.S. Department of Commerce, Office of Export Enforcement, Bureau of Industry and Security, New York Field Office, and Thomas M. Fattorusso, Special Agent in Charge, Internal Revenue Service-Criminal Investigation, New York (IRS-CI), announced the plea.
“Semiconductors and other advanced electronics are the lifeblood of Russia’s war machine, and Kahn’s circumvention of U.S. export controls was critical to Russia’s chip design and manufacturing capacity,” stated United States Attorney Peace. “Today’s plea marks a significant step in protecting the national security of the U.S. and our allies and partners abroad. We will continue to use all our law enforcement and national security tools to hold individuals and corporations accountable for flouting the law to aid sanctioned entities in Russia and elsewhere.”
Mr. Peace extended his appreciation to the U.S. Attorney’s Office for the Central District of California and the FBI’s Los Angeles Field Office for their assistance in this case.
“Today’s guilty plea is another step towards stopping the illicit flow of technology to support the Russian war machine,” said Assistant Attorney General Matthew G. Olsen of the National Security Division. “The Department will continue to do all that we can to disrupt the illegal export of sensitive dual-use electronics to our adversaries and protect our national security.”
“By operating front companies to illegally export dual-use semiconductors and other sensitive technology, Illya Kahn aided a hostile nation at the expense of the security of our nation. The FBI and our partners will continue to ensure individuals attempting to evade national security sanctions are held accountable in the criminal justice system,” stated FBI Assistant Director in Charge Dennehy.
“Working with our law enforcement colleagues, the Office of Export Enforcement will continue to investigate and dismantle sophisticated illegal procurement schemes that supply Russia’s war effort,’ said Special Agent in Charge Jonathan Carson. “Today’s guilty plea should serve as another reminder that we will not tolerate violations of the sanctions imposed on Russia since the invasion of Ukraine.”
“Khan aided Russian military and intelligence agencies by conspiring to unlawfully transfer sensitive technology to Russia, even after the 2022 invasion of Ukraine. Further, he pocketed millions in this scheme, but just like Al Capone, Kahn needed to pay tax to the U.S. government on his ill-gotten gains. This guilty plea means Kahn can no longer aid a foreign government for profit, and he is sure to give much of that money back in forfeiture and what he owes in taxes. Yes, criminals must pay taxes, even on dirty money,” said Thomas M. Fattorusso, Special Agent in Charge of IRS-CI New York.
Kahn is the owner of Senesys Incorporated and Sensor Design Association, which operated in California and Brooklyn, New York. Kahn operated these businesses — ostensibly involved in “security software development” and the testing of silicon wafers for military, avionics and space users — as fronts for a years’ long conspiracy to acquire and export sensitive and sophisticated dual-use electronics from the United States to Elvees in Russia. Many of these items required an export license for national security and anti-terrorism reasons, which Kahn did not obtain.
Kahn also arranged for Elvees to continue to fabricate and import semiconductors after Russia’s February 2022 invasion of Ukraine. These semiconductors can be used for, among other things, communications systems, GPS receivers and equipment for military unmanned aerial vehicles, also known as drones. In doing so, Kahn utilized a transnational network of front companies and bank accounts to ship those semiconductors to Russia following the invasion of Ukraine, often arranging for the semiconductors to be sent to the U.S. and then re-exported to Russia via China and other locations around the world.
In March 2022, the Commerce Department added Elvees to the Entity List, imposing a license requirement to export any item subject to the Export Administration Regulations to Elvees, and stating that it would review license applications under a policy of denial. Despite these sanctions, Kahn continued to work with Elvees. For example, in May 2022, Kahn emailed a Taiwanese manufacturer design guidance for an Elvees-branded microchip. Subsequently, Kahn shipped thousands of units of this microchip to a Hong Kong-based shipping company, and then to a company located in the mainland of the People’s Republic of China. Kahn noted in communications with the Hong Kong shipping company that he received a “call from Russia” about the PRC business to which he was directing the goods.
Kahn’s export activity for the benefit of Elvees dates to at least 2012, and accounts under his control received more than $50 million from Elvees and related entities between 2012 and 2022. Of that money, Kahn channeled nearly $5 million for his personal use, which he did not report to the IRS and on which he did not pay income taxes. As part of his plea, Kahn agreed to forfeit $4,923,548.94 in ill-gotten gains and to pay an additional $1,892,816.00 in restitution to the IRS.
Today’s actions were coordinated through the Justice and Commerce Departments’ Disruptive Technology Strike Force and the Justice Department’s Task Force KleptoCapture. The Disruptive Technology Strike Force is an interagency law enforcement strike force co-led by the Departments of Justice and Commerce designed to target illicit actors, protect supply chains, and prevent critical technology from being acquired by authoritarian regimes and hostile nation states. Task Force KleptoCapture is an interagency law enforcement task force dedicated to enforcing the sweeping sanctions, export restrictions and economic countermeasures that the United States has imposed, along with its allies and partners, in response to Russia’s unprovoked military invasion of Ukraine.
The government’s case is being handled by the Office’s National Security and Cybercrime Section. Assistant United States Attorneys Artie McConnell and Matthew Skurnik are in charge of the prosecution, along with Trial Attorney Scott Claffee of the National Security Division’s Counterintelligence and Export Control Section, with assistance from Litigation Analysts Emma Tavangari and Mary Clare McMahon. Assistant U.S. Attorney Laura Mantell of the Office’s Asset Recovery Section is handling forfeiture matters.
The Defendant:
ILYA KAHN
Age: 66
Israel; Brooklyn, New York; Los Angeles, CaliforniaE.D.N.Y. Docket No. 24-CR-56 (S-1) (AMD)
Queens Man Sentenced to Life in Prison for Murdering and Dismembering Woman in Fraudulent Scheme to Collect Life Insurance BenefitsRead the Press Release
Earlier today, in federal court in Brooklyn, Cory Martin was sentenced by United States District Judge Ann M. Donnelly to life in prison for murdering and dismembering a woman in order to collect $200,000 in life insurance proceeds. Martin was convicted by a federal jury in March 2024 following a two-week trial of murder-for-hire, murder-for-hire conspiracy, wire fraud conspiracy, aggravated identify theft and fraudulent use of identification relating to a scheme to fraudulently obtain life insurance policies in the name of his victim, kill her and collect the insurance money. Martin was also sentenced to a concurrent term of 20 years’ imprisonment for wire fraud conspiracy and a consecutive term of two years in prison for aggravated identity theft.
Breon Peace, United States Attorney for the Eastern District of New York, James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI) and Thomas G. Donlon, Interim Commissioner, New York City Police Department (NYPD), announced the sentence.
“The defendant will spend the rest of his life in prison for this ghastly, cold-blooded crime that was motivated by greed and executed after extensive planning,” stated United States Attorney Peace. “Martin preyed on Brandy Odom. He saw the victim as a way to make money. He trafficked her for commercial sex, then killed her with his bare hands so he could profit from her death. The defendant believed he could thwart law enforcement and cover up this heinous crime by relying on television shows about murder, but the investigatory efforts of law enforcement brought him to justice. Brandy Odom’s life mattered and I hope that this sentence, which protects our community by ensuring that the defendant cannot victimize another person, brings some measure of closure to her family.”
Mr. Peace expressed his thanks to the FBI’s Metro Safe Streets Task Force and the NYPD’s Brooklyn South Homicide Squad, Brooklyn South Video Team and 69th Precinct Detective Squad for their outstanding work on the case.
“Today, Cory Martin received his punishment for the despicable murder of Brandy Odom. Martin utilized fictional stories to devise his own wicked tale of murder as an amoral avenue for selfish financial gain,” stated FBI Assistant Director in Charge Dennehy. “His grisly actions reflect an utter disregard for human life as he continued to brutalize Brandy even after her death in attempt to evade law enforcement detection. May today’s sentencing offer Brandy’s family some justice and reiterate the FBI’s stout intolerance against those willing to take another's life.
“Mr. Martin has been justly sentenced to prison for his abhorrent actions, ensuring that society will be safe from him for the remainder of his life,” stated NYPD Interim Commissioner Donlon. “I applaud the unwavering commitment of our NYPD investigators, as well as our partners at the FBI and the office of the U.S. Attorney for the Eastern District of New York, whose persistence led to today’s result. We remain dedicated to holding accountable those who seek to profit from the mistreatment and exploitation of others.”
Martin, who operated as a pimp, resided at a house in Rosedale, Queens, with the then-26-year-old victim, Brandy Odom, and a co-conspirator. Both Odom and the co-conspirator were engaged in commercial sex work for the defendant. In March and December 2017, Martin and the co-conspirator fraudulently obtained two life insurance policies in Odom’s name. They made premium payments to the life insurance companies by Western Union money orders and by using a debit card in Odom’s name. At trial, Martin’s co-conspirator testified that prior to Odom’s murder, she and the defendant watched “The First 48,” a true-crime TV show about police tactics and they discussed “what not to do, and what things to do to avoid being caught by the police.” The co-conspirator testified that Martin also watched “Dexter,” a TV show about a serial killer who dismembered his victims, because the defendant was “looking for ways to commit the crime when he got rid of Brandy.”
In early April 2018, Martin strangled Odom in her bedroom. Martin and the co- conspirator then purchased cleaning supplies and a vacuum to clean up the murder scene. On April 6, 2018, Martin searched Home Depot’s website for a “Dewalt 12-Amp Corded Reciprocating Saw,” described as featuring a “powerful 12 Amp motor designed for heavy-duty applications.” Later that evening, Martin searched YouTube for “how to insert blade for reciprocating saw” and “using reciprocating saw.” The co-conspirator testified that Martin used an electric saw to dismember the victim’s corpse in the bathtub after covering every surface in the bathroom with heavy-duty, black garbage bags to avoid leaving evidence of the killing.
In the early morning of April 8 and April 9, 2018, Martin discarded Odom’s body parts in Canarsie Park with the assistance of his co-conspirator. On April 10, 2018, Martin conducted dozens of Internet searches for news articles, including “Search area expands after dismembered body found in Canarsie Park in Brooklyn.” Martin also accessed a Twitter post titled “Person walking dog discovers remains of woman in Brooklyn park.” The following day on April 11, 2018, Martin searched YouTube using the search term “exclusive interview of mother of girl found in park.” After Odom’s murder, at Martin’s direction, his co-conspirator made several unsuccessful attempts to claim benefits under Odom’s life insurance policies.
The government’s case is being handled by the Office’s Organized Crime and Gangs Section. Assistant United States Attorneys Tanya Hajjar, Emily J. Dean and Andy Palacio are in charge of the prosecution, with the assistance of Paralegal Specialist Theodore Rader.
The Defendant:
CORY MARTIN
Age: 37
Rosedale, QueensE.D.N.Y. Docket No. 20-CR-549(S-1) (AMD)
New York Man Arrested for Attempting to Provide Material Support to ISISRead the Press Release
A criminal complaint was filed today in federal court in Brooklyn charging Syed Aman, a U.S. citizen and resident of Nassau County, New York, with attempting to provide material support to the Islamic State of Iraq and al-Sham (ISIS). Aman was arrested at John F. Kennedy International Airport (JFK Airport) in Queens, New York, on Nov. 5 as he tried to board a flight to Doha, Qatar, from which he intended to ultimately travel to Syria to join ISIS. Aman's initial appearance is scheduled for this afternoon.
As alleged in the complaint, throughout 2023 and 2024, Aman expressed his support for ISIS through social media posts in an online ISIS group forum, sent money to an individual he believed to be an ISIS operative that was intended to support ISIS’s efforts in Syria and made arrangements to travel to Syria to engage in jihad, or holy war, on behalf of ISIS.
Since the beginning of October, Aman has been in contact with a confidential human source (CHS) working with the FBI about Aman's plan to join ISIS in Syria. Aman expressed that “jihad and hijrah,” referring to traveling to ISIS-controlled territory and waging war on ISIS's behalf, are “the most important thing, more than anything else at the moment.” Aman shared with the CHS Aman's hatred for “kuffar [non-believers] who deny the path of Allah.” Aman explained to the CHS, “[i]f you don't kill them they will kill us and ruin the earth with decay." During this same time period, Aman also posted on a social media platform his desire "to kill Americans” and wrote in a notebook his intent to study becoming a shaheed, or martyr on behalf of ISIS.
Aman made two attempts to book travel to the Middle East in late October 2024, but his purchases were blocked by his credit card company. On his third attempt, Aman was successful in booking a flight from JFK Airport to Bangladesh via Doha. Aman told the CHS that he intended to disembark from his flight in Qatar and to purchase a flight from Qatar to Turkey where he would seek to cross into Syria to join ISIS. Aman also stated that he would travel with a steel pen to defend himself if he were arrested and that he would attack law enforcement. A silver metal pen was found in Aman's crossbody bag when he was arrested.
On Nov. 5, Aman traveled to JFK Airport for his flight to Qatar. After Aman had checked in, been processed through airport security and attempted to board his flight, he was arrested by the FBI.
Assistant Attorney General Matthew G. Olsen of the Justice Department's National Security Division, U.S. Attorney Breon Peace for the Eastern District of New York, and Executive Assistant Director Robert Wells for the FBI’s National Security Branch made the announcement.
The FBI is investigating the case.
Assistant U.S. Attorney Antoinette N. Rangel for the Eastern District of New York is prosecuting the case with assistance provided by Trial Attorney T.J. Reardon III of the National Security Division's Counterterrorism Section.
A complaint is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
New York Man Arrested for Attempting to Provide Material Support to ISISRead the Press Release
BROOKLYN, NY - A criminal complaint was filed today in federal court in Brooklyn charging Syed Aman, a U.S. citizen and resident of Nassau County, with attempting to provide material support to the Islamic State of Iraq and al-Sham (ISIS). Aman was arrested at John F. Kennedy International Airport (JFK Airport) in Queens, New York, on November 5, 2024 as he tried to board a flight to Doha, Qatar, from which he intended to ultimately travel to Syria to join ISIS. Aman is scheduled to make his initial appearance this afternoon before United States Magistrate Judge Peggy Kuo.
Breon Peace, United States Attorney for the Eastern District of New York, Matthew G. Olsen, Assistant Attorney General for the Justice Department’s National Security Division and James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI) announced the arrest and charges.
“As alleged, Aman was steadfast in his attempts to travel to the Middle East to join ISIS and fortunately his evil plan to wage jihad was thwarted,” stated United States Attorney Peace. “My Office will continue to identify and prosecute would-be terrorists like the defendant before they are able to harm individuals at home or abroad on behalf of ISIS.”
Mr. Peace extended his appreciation to the FBI’s Joint Terrorism Task Force, which comprises a number of federal, state, and local agencies from the region, for their outstanding work on the case, and U.S. Customs and Border Protection for their assistance. “Syed Aman was allegedly determined in his efforts to support ISIS through financial donation and by making multiple attempts to travel overseas to engage in jihad on their behalf,” stated FBI Assistant Director in Charge Dennehy. “Thankfully, the New York Joint Terrorism Task Force was able to intervene before his disturbing plans of supporting a deadly terrorist organization could come to fruition. The FBI, along with our law enforcement partners, are unmatched in our resolve to protect our nation from those willing to support the evils of terrorism.”
As alleged in the complaint, throughout 2023 and 2024, Aman expressed his support for ISIS through social media posts in an online ISIS group forum, sent money to an individual he believed to be an ISIS operative that was intended to support ISIS’s efforts in Syria and made arrangements to travel to Syria to engage in jihad, or holy war, on behalf of ISIS.
Since the beginning of October 2024, Aman has been in contact with a confidential human source (CHS) working with the FBI about Aman’s plan to join ISIS in Syria. Aman expressed that “jihad and hijrah,” referring to traveling to ISIS-controlled territory and waging war on ISIS’s behalf, are “the most important thing, more than anything else at the moment.” Aman shared with the CHS Aman’s hatred for “kuffar [non-believers] who deny the path of Allah.” Aman explained to the CHS, “[i]f you don’t kill them they will kill us and ruin the earth with decay.” During this same time period, Aman also posted on a social media platform his desire “to kill Americans” and wrote in a notebook his intent to study becoming a shaheed, or martyr on behalf of ISIS.
Aman made two attempts to book travel to the Middle East in late October 2024, but his purchases were blocked by his credit card company. On his third attempt, Aman was successful in booking a flight from JFK Airport to Bangladesh via Doha, Qatar. Aman told the CHS that he intended to disembark from his flight in Qatar and to purchase a flight from Qatar to Turkey where he would seek to cross into Syria to join ISIS. Aman also stated that he would travel with a steel pen to defend himself if he were arrested and that he would attack law enforcement. A silver metal pen was found in Aman’s crossbody bag when he was arrested.
On November 5, 2024, Aman traveled to JFK Airport for his flight to Qatar. After Aman had checked in, been processed through airport security and attempted to board his flight, he was arrested by the FBI.
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 Attorney Antoinette N. Rangel is in charge of the prosecution, with assistance provided by Trial Attorney T.J. Reardon III of the Justice Department’s Counterterrorism Section.
The Defendant:
SYED AMAN
Age: 28
Franklin Square, Long Island
E.D.N.Y. Docket No. 24-MJ-599
aman_complaint.pdfTwo National MS-13 Gang Leaders and Other MS-13 Members and Associates Indicted for Murders in Queens and Long IslandRead the Press Release
A 49-count superseding indictment was unsealed today in federal court in Brooklyn that includes new charges relating to murders allegedly ordered and committed by national leaders, members and associates of the violent transnational criminal organization La Mara Salvatrucha, also known as MS-13. To date, multiple MS-13 members and associates have been charged in the case for numerous crimes including the murders of Andy Peralta in 2018, Victor Alvarenga in 2018, Abel Mosso in 2019 and Eric Monge in 2020. The superseding indictment filed today includes new charges against the following MS-13 members and associates:
- Edenilson Velasquez Larin, also known as “Agresor,” “Saturno,” “Tiny,” “Erick” and “Paco,” allegedly a national leader of MS-13 and the Fulton Locos Salvatruchas (Fulton) clique, who is charged with the 2016 murder of Kenney Reyes and for ordering the murders of Monge in 2020 and Oswaldo Gutierrez Medrano in 2022.
- Hugo Diaz Amaya, also known as “21” and “Splinter,” allegedly another national leader of MS-13 and the Park View Locos Salvatruchas clique, who is charged with racketeering conspiracy and the murder of Gutierrez Medrano in 2022.
- Numerous other members of the Fulton clique, all of whom were previously charged in the case, have also now been charged with the murders of Reyes, Monge and Gutierrez Medrano.
Breon Peace, United States Attorney for the Eastern District of New York, James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI), William S. Walker, Special Agent in Charge, Homeland Security Investigations (HSI), New York, Thomas G. Donlon, Interim Commissioner, New York City Police Department (NYPD), and Patrick Ryder, Commissioner, Nassau County Police Department (NCPD), announced the arrests and charges.
“My Office and our law enforcement partners have worked tirelessly to hold MS-13 accountable for the unspeakable harm it has done to its victims and our communities. As these charges make clear, our pursuit of those responsible will not be deterred by the passage of time or by the leaders of MS-13’s futile attempts to hide in the shadows,” stated United States Attorney Peace. “This indictment strikes yet another blow at MS-13’s leadership and demonstrates our work to dismantle MS-13 from top to bottom.”
Mr. Peace also thanked the FBI Baltimore Field Office’s Cross Border Task Force, the Nassau County District Attorney’s Office and the Suffolk County District Attorney’s Office for their valuable coordination with the investigation.
“Edenilson Velasquez Larin and Hugo Diaz Amaya, national MS-13 leaders, allegedly assumed the role of executioner by ordering and participating with the other charged defendants in a series of brutal murders to achieve status and revenge. These alleged conspiracies highlight the fearmongering and callousness in which MS-13 leaders and members operate. May today’s charges reflect the FBI’s commitment to continue its close collaboration with our law enforcement partners to rigorously dismantle the MS-13 hierarchy and disrupt all gang violence terrorizing our communities,” stated FBI Assistant Director in Charge Dennehy.
“The defendants’ ruthless violence, in furtherance of the MS-13 gang, has no place in society and our communities,” said Special Agent in Charge William S. Walker. “Everyday, HSI New York and our law enforcement partners are utilizing every tool at our disposal to dismantle transnational gangs that jeopardize the safety of New Yorkers, as demonstrated with today’s announcement. No stone will be left unturned in our pursuit of justice on behalf of the victims slain by MS-13 gang members.”
“These new charges highlight the NYPD’s relentless pursuit of individuals terrorizing our communities,” stated NYPD Interim Commissioner Donlon. “We and our law enforcement partners must continue to find and dismantle the gangs that fuel crime on our streets, and we must hold their members accountable for their senseless acts of violence. I express my gratitude to all of our federal, state, and local partners for their steadfast dedication to our shared public safety goal.”
“We want to thank our partners in federal law enforcement, particularly the United States Attorney’s Office, for this collaborative effort to bring these violent and destructive criminals to justice,” stated Nassau County Police Commissioner Patrick Ryder. “From our patrol officers on the street to the dedicated investigators in our Detective Division, the Nassau County Police Department is committed to fighting gang violence and rooting out those who bring destruction to our communities.”
The U.S. Program
As alleged in court filings, MS-13 is an extraordinarily violent street gang operating through “cliques” or chapters in Queens, Long Island and communities across the United States, as well as El Salvador, Honduras and other countries in the Americas and Europe. The gang primarily makes money through drug trafficking and extortion, and is known for its gruesome murders of perceived gang rivals and gang members and associates who have violated the gang’s rules. MS-13 has been responsible for dozens of murders in the Eastern District of New York alone.
Since approximately 2021, virtually all MS-13 cliques in the United States have been united under a single hierarchy known as the “U.S. Program.” The U.S. Program is led by a group of senior gang leaders, most of whom are incarcerated, known as “La Mesa” or “The Table.” La Mesa, among other roles, allegedly authorizes and directs murders throughout the country, including in New York. Prior to their arrests, Velasquez Larin and Diaz Amaya were allegedly two of the few members of La Mesa outside of prison — Velasquez Larin was living in Colorado and Diaz Amaya was living in Kansas — and were among the top leaders responsible for the gang’s operations on the East Coast.
Murder of Kenny Reyes
The superseding indictment adds charges for the 2016 murder in Uniondale, New York, of 18-year-old Kenny Reyes, who had recently come to the United States from Honduras. As alleged in court filings, Fulton clique member Jose Espinoza Sanchez befriended Reyes and learned that he had been associated with the 18th Street gang, rivals of MS-13. Velasquez Larin and Espinoza Sanchez plotted with other members of MS-13 in Nassau County to murder Reyes to increase their positions in the gang. On May 23, 2016, Velasquez Larin, Espinoza Sanchez and two others lured Reyes to a wooded area to smoke marijuana, where they killed him with machetes and buried his body. For years after the murder, Velasquez Larin bragged about their roles in the killing to other MS-13 members.
Murder of Eric Monge
The superseding indictment charges Velasquez Larin and Espinoza Sanchez for their roles in ordering the murder of Eric Monge, and Jose Guevara Aguilar, Jose Arevalo Iraheta and Erick Zavala Hernandez for their participation in the murder. As alleged, in the early morning hours of September 6, 2020, Guevara Aguilar and fellow Fulton clique member Oscar Hernandez Baires shot and killed Monge while he was seated in the front passenger seat of his parked car near his home in Queens. Monge’s wife had just returned to the car after bringing their young children inside their residence when Hernandez Baires and Guevara Aguilar began shooting. After the shooting, Guevara Aguilar and Hernandez Baires ran back to a car where Arevalo Iraheta and Zavala Hernandez were waiting to help them escape. As they fled to the car, Guevara Aguilar dropped his hat, which was later found to have his DNA on it.
Murder of Oswaldo Gutierrez Medrano
The superseding indictment also adds charges relating to the 2022 murder in Nassau County of 20-year-old Oswaldo Gutierrez Medrano, a member of the Sailors clique of MS-13. As alleged, Velasquez Larin and Diaz Amaya ordered the murder of Gutierrez Medrano, and Diaz Amaya coordinated luring Gutierrez Medrano to meet other MS-13 members under the false pretense that he would be receiving a promotion within MS-13. In Nassau County, on February 13, 2022, Gutierrez Medrano allegedly met with those other members of MS-13, including defendants Arevalo Iraheta, Carlos Alvarado, Erick Galdamez Leon and Jose Mejia Hernandez, who allegedly killed him with machetes and knives, dismembered his body and buried him in a wooded area.
The charges in the superseding indictment are allegations, and the defendants are presumed innocent unless and until proven guilty.
This case was investigated as part of the ongoing efforts by the OCDETF, a partnership that brings together the combined expertise of federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.
Today’s charges 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. Since 2003, hundreds of MS-13 members, including dozens of clique leaders, have been convicted on federal felony charges in the Eastern District of New York. A majority of those MS-13 members have been convicted on federal racketeering charges for participating in murders, attempted murders and assaults. Since 2009, this Office has obtained indictments charging MS-13 members with carrying out more than 70 murders in the district and has convicted dozens of MS-13 leaders and members in connection with those murders. These prosecutions are the product of investigations led by our law enforcement partners.
The government’s case is being handled by the Office’s Organized Crime and Gangs Section. Assistant United States Attorneys Jonathan Siegel, Michael W. Gibaldi, Anna L. Karamigios and Sophia M. Suarez are in charge of the prosecution, with the assistance of Paralegal Specialist Eleanor Jaffe-Pachuilo.
New Defendant:
HUGO DIAZ AMAYA (also known as “21” and “Splinter”)
Age: 36
Kansas City, KansasDefendants Previously Indicted:
RAMIRO GUTIERREZ (also known as “Cara de Malo”)
Age: 31
Flushing, New YorkVICTOR LOPEZ (also known as “Curioso”)
Age: 26
Flushing, New YorkTITO MARTINEZ-ALVARENGA (also known as “Imprudente”)
Age: 24
Flushing, New YorkISMAEL SANTOS-NOVOA (also known as “Profe” and “Travieso”)
Age: 36
Flushing, New YorkEDENILSON VELASQUEZ LARIN (also known as “Agresor,” “Saturno,” “Tiny,” “Erick” and “Paco”)
Age: 35
Thornton, ColoradoCHRISTIAN ALAS LEON (also known as “Pata de Chucho”)
Age: 26
Westbury, New YorkCARLOS ALVARADO (also known as “Brayle” and “Danny”)
Age: 21
Westbury, New YorkJOSE AREVALO IRAHETA (also known as “Splinter,” “Inesperado” and “Daniel”)
Age: 27
Queens, New YorkJOSE ESPINOZA SANCHEZ (also known as “Cable,” “Bleca,” “Clave,” “Fantasma” and “Victor”)
Age: 25
Carrboro, North CarolinaERICK GALDAMEZ LEON (also known as “Truco,” “Burro,” and “Chicle”)
Age: 24
Westbury, New YorkJOSE GUEVARA AGUILAR (also known as “Tranquilo,” “Malhechor,” and “Angel”
Age: 25
Queens, New YorkKEILA HERNANDEZ MAY
Age: 37
Carrboro, North CarolinaYONATHAN HERNANDEZ
Age: 25
Hempstead, New YorkJOSE MEJIA HERNANDEZ (also known as “Mismo” and “Timbre”)
Age: 22
Westbury, New YorkJOSE PEREZ OVANDO (also known as “Domino” and “Incompleto”)
Age: 24
Westbury, New YorkERICK ZAVALA HERNANDEZ (also known as “Berry,” “Berro,” and “Alex”)
Age: 26
Queens, New YorkE.D.N.Y. Docket No. 20-CR-228 (S-3) (LDH)
Telehealth Company Cerebral Agrees to Pay over $3.6 Million in Connection with Business Practices that Encouraged the Unauthorized Distribution of Controlled SubstancesRead the Press Release
Breon Peace, the United States Attorney for the Eastern District of New York, and Anne Millgram, Administrator of the U.S. Drug Enforcement Administration (DEA), announced today that the online mental healthcare company Cerebral, Inc. (Cerebral) has entered into a non-prosecution agreement (NPA) with the U.S. Attorney’s Office for the Eastern District of New York (the Office), and has agreed to pay more than $3.6 million for engaging in practices that encouraged the unauthorized distribution of controlled substances from 2019 to 2022. An additional fine against Cerebral has been deferred in light of the company’s current financial condition.
Under the terms of the NPA, Cerebral agreed to forfeit $3,652,000 to the United States. The NPA requires Cerebral to continue to cooperate with and provide information to the United States for at least the 30-month term of the agreement. The NPA also requires Cerebral to pay a fine of $2,922,000, which the Office has determined that Cerebral does not currently have the ability to pay; as a result, it will be deferred for the term of the NPA, and waived at the expiration of the NPA if Cerebral is in compliance with the NPA and unless the Office determines that Cerebral’s financial performance has changed such that payment of all or a portion of the fine would be warranted. In the event that Cerebral violates the NPA, the Office may prosecute Cerebral for any of the conduct that gave rise to the NPA and any newly discovered criminal activity.
“People seeking care for their mental health conditions should receive high-quality care that is not motivated or driven by greed,” stated United States Attorney Peace. “Cerebral sought to increase its bottom line by increasing the prescription of drugs, including controlled substances that can be highly addictive and dangerous. Since my Office’s investigation came to Cerebral’s attention, the company has cooperated fully and taken significant steps to remediate the institutional failures that allowed this situation to occur in the first place. This resolution ensures that Cerebral will be financially accountable for its unacceptable conduct and serves as a reminder to the healthcare industry that my Office is committed to ensuring patient safety and protecting the public from business practices like those of Cerebral.”
“Today’s settlement holds Cerebral responsible for their failure to protect patients from the harms caused by the unnecessary or overprescribing of potentially-addictive ADHD medications,” said DEA Administrator Anne Milgram. “Cerebral’s exploitation of telemedicine flexibilities deceived patients who were legitimately seeking medical care, putting them at risk in exchange for profit. DEA remains committed to telemedicine accessibility that supports the health of all patients while also ensuring that telemedicine companies and practitioners prioritize patient health and safety above all else.”
Cerebral’s Operations
Cerebral is an online mental health company that operates primarily as a direct-to-consumer business. Since October 2019, Cerebral has promoted or sold subscription services offering online health care treatment, including mental health treatment and medication management services, through its online platforms, to hundreds of thousands of patients struggling with depression, anxiety and other mental health issues. Cerebral generated revenue by offering tiered monthly subscription plans to its patients. Certain of Cerebral’s subscription plans offered patients the ability to obtain medication from Cerebral’s treatment providers.
Attention-Deficit/Hyperactivity Disorder (ADHD) was one of the mental health conditions Cerebral offered treatment for. Cerebral first launched its ADHD line of service in or around February 2021 and began offering ADHD treatment services to the public across the United States, rolling services out on a state-by-state basis. Cerebral’s ADHD services were perceived to be a profitable line of business with the potential to increase patient retention at the company.
Beginning in October 2020, Cerebral expanded its medication offerings to include controlled substances. In addition, beginning in February 2021, Cerebral permitted its treatment providers to prescribe stimulant medication, such as Adderall, to its patients. Prescription stimulants, such as Adderall, are Schedule II drugs under the Controlled Substances Act.
Cerebral’s Prescription Practices
Between February 2021 and October 2022, Cerebral instituted internal measures to increase the prescriptions of medications with the goal of boosting patient retention and, by extension, Cerebral’s revenue.
Cerebral monitored the rates at which its providers prescribed medications, including controlled substances, primarily through two metrics which measured: (1) the number of drug prescriptions issued to patients who enrolled in a medication management subscription plan after their first 30-minute telehealth visit (the Initial Visit Rx Rate); and (2) the number of stimulant prescriptions prescribed to patients diagnosed with ADHD who had no comorbidities (the ADHD Stimulant Rx Metric). Cerebral did not consult with any members of its clinical advisory board—which included multiple experts in the fields of psychology and psychiatry—prior to implementing targeted campaigns to improve both metrics.
Between May 2021 and May 2022, Cerebral sought to increase the Initial Visit Rx Rate to 95%. Cerebral recognized inherent problems with the Initial Visit Rx Rate, including the fact that the metric did not take into account whether patients were diagnosed with conditions where drug prescriptions were clinically appropriate, and that the 95% target goal was not based on any established data or benchmark in medical or scientific literature. Cerebral also recognized that there were a variety of legitimate reasons why its treatment providers would not prescribe drugs to patients immediately after the patient’s first visit, and that the Initial Visit Rx Rate could perversely incentivize its treatment providers into prescribing medication that was not necessary. Nonetheless, the company reviewed treatment providers’ performance using the Initial Visit Rx Rate and engaged in coordinated efforts to increase the Initial Visit Rx Rate, including by implementing a bonus structure that awarded bonuses to supervisory individuals if they increased the Initial Visit Rx metric among their supervisees; and conducting regular reviews of providers’ individual Initial Visit Rx Rate. Despite the Company’s efforts to increase its performance on the Initial Visit Rx metric, it did not improve after December 2021. Cerebral ceased using the Initial Visit metric in or about May 2022, after Cerebral’s former Chief Executive Officer was terminated.
Beginning in at least October 2021, Cerebral also took initiatives to measure the percentage of controlled substances prescriptions issued to patients who had been diagnosed with ADHD without comorbidities. Cerebral subsequently developed an internal plan to increase the ADHD Stimulant Rx Metric to 100% or “near 100%” and regularly audited its providers’ ADHD prescription practices. Cerebral also considered disciplinary measures, such as issuing “flags” and “strikes,” for individuals who the company considered to be underperformers for this metric. Cerebral instituted these measures despite the fact that certain of its treatment providers had expressed concerns to Cerebral’s management about drug diversion risks with ADHD patients. Cerebral ceased all use of the ADHD Stimulant Rx Metric by October 2022.
In addition to the above tactics, Cerebral also provided financial payments that incentivized its providers to issue stimulant medication for ADHD patients. Specifically, prior to May 2022, Cerebral paid its providers an additional $10 to conduct required pre-prescription checks of Prescription Drug Monitoring Programs (PDMP)/Prescription Monitoring Program (PMP) databases. Cerebral did not compensate its providers for conducting PDMP/PMP checks for patients with any other medical diagnoses or patient needs.
Cerebral’s Diversion Risks
According to Cerebral’s admissions, Cerebral also did not maintain effective controls against drug diversion, even when risks of drug diversion were elevated to or acknowledged by its management. For example, Cerebral had thousands of duplicate patient accounts (i.e., multiple accounts that belonged to the same individual) that were not fully addressed internally until at least early 2022. As a result of the failure to timely identify and remove duplicate accounts, at least one patient was able to obtain stimulant prescriptions from multiple providers at Cerebral, even after having been previously flagged as having misused stimulants. As another example, prior to 2022, Cerebral also permitted drug-seeking patients who were not prescribed controlled substances in the first instance to seek reassignment to different providers.
The Non-Prosecution Agreement
Cerebral has agreed to forfeit $3,652,000 to the United States, which represent the amount of proceeds that could be reasonably attributed to the monthly increase in ADHD revenue generated by patients who were diagnosed with ADHD and subsequently prescribed stimulant prescriptions. Cerebral has also agreed to pay a fine of $2,922,000, which the Office has determined that Cerebral does not currently have the ability to pay; as detailed above, it will be deferred for the term of the NPA.
The Office reached this resolution with Cerebral after carefully weighing all of the factors relevant to the appropriate corporate resolution. The NPA recognizes that, although Cerebral’s serious misconduct was reported to the Office before Cerebral self-disclosed it, Cerebral voluntarily took a number of substantial remedial measures beginning in May 2022 to mitigate and correct the effects of the practices described above, including terminating its former Chief Executive Officer, stopping all use of the prescription metrics described above, and improving its compliance measures. In October 2022, Cerebral voluntarily stopped prescribing controlled substances to all of its patients, and has agreed not to prescribe controlled substances in the future. Cerebral also has no prior criminal history in the United States. Furthermore, Cerebral has cooperated extensively with the Office in its investigation, including through detailed disclosures, and has agreed to continue to cooperate fully with the Office.
The agreement announced today is the result of an investigation conducted by the Drug Enforcement Administration, New York Division, Buffalo Diversion Group, Tactical Diversion Squad. The government’s case is being handled by the Office’s International Narcotics and Money Laundering Section and Business and Securities Fraud Section. Assistant United States Attorneys Genny Ngai, Gillian Kassner and Miranda Gonzalez are in charge of the prosecution, with the assistance of the Office’s former Paralegal Specialists Sophia Cronin, Riley Martinez and Jordi Martinez.
The Defendant:
CEREBRAL, INC.
cerebral_agreement.pdf
Claymont, DelawareU.S. and Russian National Pleads Guilty to Helping Russia's Defense Sector Evade U.S. Export ControlsRead the Press Release
Earlier today in federal court in Brooklyn, Vadim Yermolenko, a national of both the U.S. and Russia, pleaded guilty to conspiracy to violate the Export Control Reform Act, conspiracy to commit bank fraud, and conspiracy to defraud the United States for his role in a transnational procurement and money laundering network that sought to acquire sensitive dual-use electronics for Russian military and intelligence services. The proceeding was held before United States District Judge Hector Gonzalez. When sentenced, Yermolenko faces up to 30 years in prison.
Merrick B. Garland, United States Attorney General, Breon Peace, United States Attorney for the Eastern District of New York, James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI), Jonathan Carson, Special Agent in Charge, New York Field Office of the Office of Export Enforcement, Bureau of Industry and Security (BIS), US Department of Commerce (DOC), and Thomas M. Fattorusso, Special Agent in Charge, Internal Revenue Service-Criminal Investigation, New York (IRS-CI) announced the plea.
“This defendant joins the nearly two dozen other criminals that our Task Force KleptoCapture has brought to justice in American courtrooms over the past two and a half years for enabling Russia’s military aggression,” said Attorney General Merrick B. Garland. “This defendant admitted to playing a central role in a now-disrupted scheme with Russian intelligence services to smuggle sniper rifle ammunition and U.S. military grade equipment into Russia. The Justice Department will never stop working to aggressively disrupt and prosecute both the criminal networks and the individuals responsible for bolstering the Russian war machine.”
“To facilitate the Russian war machine, the defendant played a critical role in exporting sensitive, dual-use technologies to Russia, facilitating shipping and the movement of millions of dollars through U.S. financial institutions,” stated United States Attorney Peace. “This plea highlights my Office and our law enforcement partners continued commitment to use all tools available to prosecute those who unlawfully procure U.S. technology to send to Russia.”
Mr. Peace thanked the U.S. Customs and Border Protection, the Department of Justice’s Office of International Affairs, and the Estonian authorities for their valuable assistance.
“As he admitted today, Vadim Yermolenko took part in a conspiracy to evade U.S. sanctions and assist the Russian war machine by unlawfully purchasing and exporting highly sensitive, export controlled electronic components. The FBI is determined to fulfill our mission of protecting the security of our nation. Any individual attempting to evade our national security laws will be held accountable in the criminal justice system,” stated FBI Assistant Director in Charge Dennehy.
“Yermolenko and his illicit network supported Russian intelligence services in attempting to procure sensitive American technology,” said Jonathan Carson, Special Agent in Charge, New York Field Office of the Office of Export Enforcement, Bureau of Industry and Security, US Department of Commerce. “You can add this guilty plea to the list of the many enforcement actions we’ve brought since the start of the Strike Force to target and dismantle Russian procurement networks.”
“Whether it was from misplaced foreign allegiance or pure greed, Yermolenko aided Russia’s military and intelligence agencies in circumventing policies meant to keep the Russian ‘war machine’ in check. Through a sophisticated network of shell companies and bank accounts, he laundered more than twelve million dollars and purchased highly sensitive military equipment for Russia. Law enforcement worked in close collaboration to share information and resources, ensuring that Yermolenko and his associates are no longer in operation, making the world safer,” said Thomas M. Fattorusso, Special Agent in Charge of IRS-CI New York.
As alleged in court documents, the defendant was affiliated with Serniya Engineering (Serniya) and Sertal LLC (Sertal), Moscow-based companies that operate under the direction of Russian intelligence services to procure advanced electronics and sophisticated testing equipment for Russia’s military industrial complex and research and development sector. Serniya and Sertal operated a vast network of shell companies and bank accounts throughout the world, including in the United States, that were used in furtherance of the scheme to conceal the involvement of the Russian government and the true Russian end users of U.S.-origin equipment.
The defendant and his co-conspirators unlawfully purchased and exported highly sensitive, export controlled electronic components, some of which can be used in the development of nuclear and hypersonic weapons, quantum computing, and other military applications. Following Russia’s invasion of Ukraine in February 2022, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) and the DOC BIS levied and imposed additional export restrictions on Serniya, Sertal, and several individuals and companies involved in the scheme, calling them “instrumental to the Russian Federation’s war machine.”
Sertal was licensed to conduct highly sensitive and classified procurement activities by Russia’s Federal Security Service (FSB), Russia’s principal security agency and the main successor agency to the Soviet Union’s KGB. The Serniya network’s Russian clients included State Corporation Rostec, the state-owned defense conglomerate; State Atomic Energy Corporation Rosatom; the Ministry of Defense; the Foreign Intelligence Service; and various components of the FSB, including the Department of Military Counterintelligence and the Directorate for Scientific and Technological Intelligence, commonly known as “Directorate T.”
To carry out the scheme, the defendant helped set up numerous shell companies and dozens of bank accounts in the U.S. to illicitly move money and export-controlled goods. During the period charged in the indictment, more than $12 million passed through accounts owned or controlled by the defendant. These funds were used in part to purchase sensitive equipment used in radar, surveillance, and military research and development. In one instance, money from one of the defendant’s accounts was used to purchase export-controlled sniper bullets, which were intercepted in Estonia before they could be smuggled into Russia.
Co-defendant Alexey Brayman previously pled guilty to conspiracy to defraud the United States and is awaiting sentence. On July 29, 2024, Konoshchenok was removed from the United States as part of a prisoner exchange negotiated between the United States and Russia. Defendants Boris Livshits, Alexey Ippolitov, Svetlana Skvortsova, and Yevgeniy Grinin remain at large.
This prosecution is coordinated through the Justice Department’s Task Force KleptoCapture and the Justice and Commerce Departments’ Disruptive Technology Strike Force. Task Force KleptoCapture is an interagency law enforcement task force dedicated to enforcing the sweeping sanctions, export restrictions, and economic countermeasures that the U.S. has imposed, along with its allies and partners, in response to Russia’s unprovoked military invasion of Ukraine. The Disruptive Technology Strike Force is an interagency law enforcement strike force co-led by the Departments of Justice and Commerce designed to target illicit actors, protect supply chains, and prevent critical technology from being acquired by authoritarian regimes and hostile nation states.
The government’s case is being handled by the Office’s National Security and Cybercrime Section. Assistant United States Attorneys Artie McConnell, Andrew D. Reich, Matthew Skurnik, and Trial Attorney Scott A. Claffee of the National Security Division’s Counterintelligence and Export Control Section, are in charge of the prosecution, along with assistance from Litigation Analysts Emma Tavangari and Mary Clare McMahon.
The Defendant:
VADIM YERMOLENKO
AGE: 43
Upper Saddle River, New JerseyOther Defendants:
ALEXEY IPPOLITOV
AGE: 58
Moscow, RussiaYEVGENIY GRININ
age: 46
Moscow, RussiaBORIS LIVSHITS
Age: 54
St. Petersburg, RussiaSVETLANA SKVORTSOVA
AGE: 43
Moscow, RussiaVADIM KONOSHCHENOK
AGE: 50
Tallin, EstoniaALEXEY BRAYMAN
AGE: 37
Merrimack, New HampshireE.D.N.Y. Docket No. 22-CR-409 (S-3) (HG)
NIKOLAOS BOGONIKOLOS
AGE: 60
Athens, GreeceE.D.N.Y. Docket No. 23-MJ-412
New Jersey Resident Pleads Guilty to Helping Russia’s Defense Sector Evade U.S. Export ControlsRead the Press Release
Vadim Yermolenko, 43, a dual U.S.-Russian national and resident of New Jersey, pleaded guilty to conspiracy to violate the Export Control Reform Act, conspiracy to commit bank fraud, and conspiracy to defraud the United States for his role in a transnational procurement and money laundering network that sought to acquire sensitive dual-use electronics for Russian military and intelligence services.
“This defendant joins the nearly two dozen other criminals that our Task Force KleptoCapture has brought to justice in American courtrooms over the past two and a half years for enabling Russia’s military aggression,” said Attorney General Merrick B. Garland. “This defendant admitted to playing a central role in a now-disrupted scheme with Russian intelligence services to smuggle sniper rifle ammunition and U.S. military grade equipment into Russia. The Justice Department will never stop working to aggressively disrupt and prosecute both the criminal networks and the individuals responsible for bolstering the Russian war machine.”
“The illegal export of sensitive, dual-use technologies in support of Russia’s war effort poses a significant threat to the United States and its allies and must not be tolerated,” said FBI Director Christopher Wray. “The defendant in this case played a key role in exporting U.S. technology that in the hands of our adversaries could pose great danger to our national security. The FBI and its partners will continue to focus on protecting strategic innovation at home and hold accountable anyone who facilitates illegal transfers to hostile nations like Russia.”
“To facilitate the Russian war machine, the defendant played a critical role in exporting sensitive, dual-use technologies to Russia, facilitating shipping and the movement of millions of dollars through U.S. financial institutions,” said U.S. Attorney Breon Peace for the Eastern District of New York. “This plea highlights my Office and our law enforcement partners continued commitment to use all tools available to prosecute those who unlawfully procure U.S. technology to send to Russia.”
“Today’s guilty plea is just the latest in a series of actions taken by the Commerce Department and our law enforcement partners to hold accountable those who illegally procure American technology for the Russian war machine,” said Assistant Secretary for Export Enforcement Matthew S. Axelrod. “As this case demonstrates, we are continuing to focus our efforts on dismantling every node of these illicit procurement networks.”
According to court documents, the defendant was affiliated with Serniya Engineering and Sertal LLC, Moscow-based companies that operate under the direction of Russian intelligence services to procure advanced electronics and sophisticated testing equipment for Russia’s military industrial complex and research and development sector. Serniya and Sertal operated a vast network of shell companies and bank accounts throughout the world, including the United States, that were used in furtherance of the scheme to conceal the involvement of the Russian government and the true Russian end users of U.S.-origin equipment.
The defendant and his co-conspirators unlawfully purchased and exported highly sensitive, export controlled electronic components, some of which can be used in the development of nuclear and hypersonic weapons, quantum computing and other military applications. Following Russia’s invasion of Ukraine in February 2022, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) and the U.S. Department of Commerce (DOC) Bureau of Industry and Security (BIS) levied sanctions and imposed additional export restrictions on Serniya, Sertal, and several individuals and companies used in the scheme, calling them “instrumental to the Russian Federation’s war machine.”
Sertal was licensed to conduct highly sensitive and classified procurement activities by Russia’s Federal Security Service (FSB), Russia’s principal security agency and the main successor agency to the Soviet Union’s KGB. The Serniya network’s Russian clients included State Corporation Rostec, the state-owned defense conglomerate; State Atomic Energy Corporation Rosatom (Rosatom); the Ministry of Defense; the Foreign Intelligence Service (SVR); and various components of the FSB, including the Department of Military Counterintelligence and the Directorate for Scientific and Technological Intelligence, commonly known as “Directorate T.”
To carry out the scheme, the defendant helped set up numerous shell companies and dozens of bank accounts in the U.S. to illicitly move money and export-controlled goods. During the period charged in the indictment, more than $12 million passed through accounts owned or controlled by the defendant. These funds were used in part to purchase sensitive equipment used in radar, surveillance and military research and development. In one instance, money from one of the defendant’s accounts was used to purchase export-controlled sniper bullets, which were intercepted in Estonia before they could be smuggled into Russia.
Co-defendant Alexey Brayman previously pleaded guilty to conspiracy to defraud the United States and is awaiting sentence. The case against co-defendant Vadim Konoshchenok, a suspected FSB operative, was dismissed after Konoshchenok was removed from the United States as part of a prisoner exchange negotiated between the United States and Russia. Defendant Nikolaos Bogonikolos’ case remains pending. Defendants Boris Livshits, Alexey Ippolitov, Svetlana Skvortsova, and Yevgeniy Grinin remain at large.
The FBI, BIS, and IRS are investigating the case.
The U.S. Customs and Border Protection, Department of Justice’s Office of International Affairs, and Estonian authorities provided valuable assistance.
Assistant U.S. Attorneys Artie McConnell, Andrew D. Reich, and Matthew Skurnik for the Eastern District of New York are prosecuting the case, with assistance from Trial Attorney Scott A. Claffee of the National Security Division’s Counterintelligence and Export Control Section.
Today’s actions were coordinated through the Justice Department’s Task Force KleptoCapture and the Justice and Commerce Departments’ Disruptive Technology Strike Force. Task Force KleptoCapture is an interagency law enforcement task force dedicated to enforcing the sweeping sanctions, export restrictions and economic countermeasures that the United States has imposed, along with its allies and partners, in response to Russia’s unprovoked military invasion of Ukraine. The Disruptive Technology Strike Force is an interagency law enforcement strike force co-led by the Departments of Justice and Commerce designed to target illicit actors, protect supply chains and prevent critical technology from being acquired by authoritarian regimes and hostile nation states.
Drug Dealer Sentenced to Nine Years in Prison for Opioid Pill Mill Scheme That Illegally Distributed More Than 1.2 Million Oxycodone PillsRead the Press Release
Earlier today, at the federal courthouse in Brooklyn, Michael Kent was sentenced by United States District Judge Ann M. Donnelly to nine years in prison for his role in recruiting sham patients, paying off complicit pharmacists and illegally distributing oxycodone in a Brooklyn-based narcotics conspiracy. Kent pleaded guilty to conspiring to distribute and to possess with intent to distribute oxycodone in September 2023. Kent also paid $635,875 in forfeiture in advance of his sentencing.
Breon Peace, United States Attorney for the Eastern District of New York, Frank A. Tarentino, Special Agent in Charge, U.S. Drug Enforcement Administration, New York Division (DEA), Naomi Gruchacz, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG) and Thomas M. Fattorusso, Special Agent in Charge, Internal Revenue Service-Criminal Investigation, New York (IRS-CI), announced the sentence.
“The opioid epidemic has destroyed countless families and communities in our district, New York City and across the country,” stated United States Attorney Peace. “The proliferation of pill mill clinics, like the medical office involved in this case, significantly contributes to the opioid crisis. Today’s sentencing holds the defendant accountable for his role in callously diverting highly potent and addictive drugs from medical offices to the streets of New York.”
Mr. Peace also thanked the New York City Department of Investigation, the New York City Police Department and the New York State Department of Health, Bureau of Narcotic Enforcement, for their assistance on the case.
“Michael Kent knew the harmful effects of his pill mill scheme, and knowingly jeopardize the health and safety of those individuals he profited from, all while exacerbating the opioid crisis. Today’s sentencing sends a clear message to those individuals putting profits over human lives and looking to capitalize from the illegal sale of addictive opioids” stated DEA Special Agent in Charge Tarentino. “The DEA remains committed to fighting this opioid crisis head on and those who exploit it.”
“The defendant in this case was involved in a scheme to steer controlled substances to the street, which is especially egregious given the ongoing opioid epidemic,” stated HHS-OIG Special Agent in Charge Gruchacz. “HHS-OIG will continue to work with our law enforcement partners to ensure individuals involved in fraud schemes that exploit federal health care programs and threaten patient safety are held accountable.”
“Kent created an extravagant, multi-layered scheme in order to earn a simple title—drug dealer. He had no regard for the welfare of those buying the oxy as long as he lined his pockets, which were fat enough to buy three buildings in New York City. Unlucky for him, this elaborate scam was not too tricky for law enforcement to figure out, and he is now sentenced to time behind bars,” stated IRS-CI Special Agent in Charge Fattorusso.
As set forth in the indictment and publicly filed documents, between December 2018 and October 2022, Kent and his co-defendants operated a drug distribution ring out of a medical practice on Linden Boulevard in East New York, Brooklyn. Together, they unlawfully distributed more than 11,000 prescriptions for oxycodone, amounting to more than 1.2 million oxycodone pills, which carry a street value of at least $24 million. They made millions of dollars from the scheme. Nine defendants have been charged in this matter, including one doctor and four Brooklyn-based pharmacists. In addition to Kent, five co-defendants have pleaded guilty. Three co-defendants are scheduled for trial in January 2025.
As part of his role in the scheme, Kent recruited approximately 45 sham patients who were prescribed more than six kilograms of medically unnecessary oxycodone over a four-year period. Kent paid these individuals for the use of their names, picked up the oxycodone from pharmacists, whom he paid off, and sold the oxycodone to dealers for distribution on the street. Kent then laundered the drug proceeds through a shell company he created called “Michael’s Cleaning Service,” using the money to buy three buildings in New York City. When he was arrested in October 2022, law enforcement officers recovered two loaded firearms from his home and seized thousands of dollars in cash.
Oxycodone is a highly addictive opioid used to treat severe and chronic pain conditions. Every year, millions of Americans abuse oxycodone, and the misuse of prescription painkillers like oxycodone leads to hundreds of thousands of annual emergency room visits. More than 14,000 Americans died from prescription opioid overdoses in 2022, according to the Centers for Disease Control and Prevention (CDC). Oxycodone prescriptions have enormous cash value to drug dealers. For example, one oxycodone 30 mg tablet, which was the dosage prescribed in this case, can be sold by dealers on the street for between $20 and $30 in New York City.
This effort is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach.
The government’s case is being handled by the Office’s Public Integrity Section. Assistant United States Attorneys Laura Zuckerwise, Victor Zapana and Gilbert Rein are in charge of the prosecution, with assistance from paralegal specialists Rachel Friedman and Nadya Osman. Assistant United States Attorney Claire Kedeshian of the Office’s Asset Recovery Section is handling forfeiture matters.
The Defendant:
MICHAEL KENT
Age: 51
Brooklyn, New YorkE.D.N.Y. Docket No. 22-CR-464 (AMD)
United States Attorneys Available to Receive Election ComplaintsRead the Press Release
United States Attorneys Breon Peace and Damian Williams announced today that Assistant United States Attorneys (AUSAs) will lead the efforts of their Offices in connection with the Justice Department’s nationwide Election Day Program for the upcoming November 5, 2024 general election. AUSA Erik Paulsen has been appointed to serve as the District Election Officer (DEO) for the Eastern District of New York, and AUSA David J. Kennedy has been appointed to serve as the DEO for the Southern District of New York. In their capacity as DEOs, these AUSAs are responsible for overseeing the Districts’ handling of Election Day complaints of voting rights concerns, threats of violence to election officials or staff, and election fraud, in consultation with Justice Department Headquarters in Washington.
“A free election is the cornerstone of our democracy and every citizen in the Eastern District of New York must be able to vote and have their votes counted fairly and without interference, discrimination or threat of violence,” said United States Attorney Peace. “Election officials and their staff also must be able to perform their duties without being subjected to unlawful threats of violence or intimidation. My Office will defend those rights with the full force of federal law.”
United States Attorney Williams said, “Free, fair, and accessible elections are critical to democracy, and every voter in the Southern District of New York deserves to cast their vote with confidence in the integrity of our electoral process. It is the responsibility and privilege of this Office to work together with our law enforcement partners to ensure that New Yorkers are able to exercise their right to vote free of unlawful intimidation or hindrance. We encourage anyone who finds their civic voting protections subject to any attempted undue interference to please contact the numbers below.”
The Department of Justice plays an important role in deterring and combatting discrimination and intimidation at the polls, threats of violence directed at election officials and poll workers, and election fraud. The Department will address these violations wherever they occur. The Department’s longstanding Election Day Program furthers these goals and also seeks to ensure public confidence in the electoral process by providing local points of contact within the Department for the public to report possible federal election law violations.
Federal law protects against such crimes as threatening violence against election officials or staff, intimidating or bribing voters, buying and selling votes, impersonating voters, altering vote tallies, stuffing ballot boxes and marking ballots for voters against their wishes or without their input. It also contains special protections for the rights of voters, and provides that they can vote free from interference, including intimidation, and other acts designed to prevent or discourage people from voting or voting for the candidate of their choice. The Voting Rights Act protects the right of voters to mark their own ballot or to be assisted by a person of their choice (where voters need assistance because of disability or individuals who are limited English proficient).
United States Attorneys Peace and Williams stated that: “The franchise is the cornerstone of American democracy. We all must ensure that those who are entitled to the franchise can exercise it if they choose, and that those who seek to corrupt it are brought to justice. In order to respond to complaints of voting rights concerns and election fraud during the upcoming election, and to ensure that such complaints are directed to the appropriate authorities, AUSAs will be on duty in this District while the polls are open.”
In order to respond to complaints of election fraud or voting rights concerns during the voting period that ends on November 5, 2024, and to ensure that such complaints are directed to the appropriate authorities, the United States Attorneys said that their Offices will be available to receive complaints at the following numbers through Tuesday, November 5, 2024:
(646) 369-4739 (for Manhattan, Bronx, Dutchess, Orange, Putnam, Rockland, Sullivan, and Westchester counties) and (718) 254-6085 (for Brooklyn, Queens, Staten Island, Nassau, and Suffolk counties).
Complaints about possible violations of the federal voting rights laws can be made directly to the Civil Rights Division in Washington, DC by phone at 800-253-3931 or by complaint form at https://civilrights.justice.gov/
In addition, the Federal Bureau of Investigation (FBI) will have special agents available in each field office and resident agency throughout the country to receive allegations of election fraud and other election abuses on Election Day. The local FBI field office can be reached by the public at (212) 384-1000.
In the case of a crime of violence or intimidation, please call 911 immediately and before contacting federal authorities. State and local police have primary jurisdiction over polling places, and almost always have faster reaction capacity in an emergency.
The United States Attorneys also noted that the following additional telephone numbers are available on Election Day 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
New York City Board of Elections
Main Office (866) 868-3692
TTY #: 212-487-5496
IN COUNTIES OUTSIDE NEW YORK CITY
County Boards of Elections
Dutchess (845) 486-2473
Nassau (516) 571-8683
Orange (845) 360-6500
Orange (Spanish language) (855) 331-2444
Putnam (845) 808-1300
Rockland (845) 638-5172
Suffolk (631) 852-4500
Sullivan (845) 807-0400
Westchester (914) 995-5700
Long Island Man Sentenced to 28 Years in Prison for Sexually Exploiting MinorsRead the Press Release
Earlier today, at the federal courthouse in Central Islip, Edgardo Mejia was sentenced by United States District Judge Joan M. Azrack to 28 years in prison for sexually exploiting minors. The defendant was charged with causing an 11-year-old girl (“Jane Doe 1”) to create numerous sexually explicit videos of herself, as well as at least two sexually explicit images of Jane Doe 1’s two-year-old niece, all of which was sent to the defendant. Mejia pleaded guilty in August 2022.
Breon Peace, United States Attorney for the Eastern District of New York, announced the sentence.
Mr. Peace expressed his appreciation to Homeland Security Investigations (HSI) and the Nassau County Police Department (NCPD) for their work on the case.
As set forth in the government’s sentencing memorandum and other court documents, on February 20, 2017, Facebook reported several cybertips to the National Center for Missing and Exploited Children regarding social media accounts that were being used to sexually exploit female minors. One account was under the name “Bryan Gonsalez” and two other accounts were under the name “Eddie Mejia.” Further investigation by law enforcement determined that the electronic device being used to access the accounts was registered to the defendant at an address in Uniondale, New York. Mejia was using the accounts to communicate with numerous minors, sending them explicit images of himself and enticing them to engage in sexually explicit conduct and send him images of such conduct. On December 15, 2017, Mejia, while posing as a 13-year-old boy, communicated with Jane Doe 1 asking her if she wanted to be his “gf” and send a picture of herself. Mejia also asked her to perform sexually explicit acts and record them on video. On December 17, 2017, Mejia asked Jane Doe 1 to take sexually explicit images of her niece and send them to him. The defendant engaged in similar conduct with numerous other minors, and frequently threatened and extorted those victims when they did not comply with his requests.
On January 25, 2018, the defendant was arrested in Port Washington, New York by HSI and NCPD, and has been detained since then.
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 https://www.justice.gov/psc
The government’s case is being handled by the Criminal Section of the Office’s Long Island Division. Assistant U.S. Attorney Megan E. Farrell is in charge of the prosecution.
The Defendant:
EDGARDO MEJIA (also known as “Eddie Mejia,” “Eddie Reyes,” “Carlos Reyez,” and “Bryan Gonsalez”)
Age: 42
Uniondale, Long IslandE.D.N.Y. Docket No. 18-CR-81 (JMA)
Three Individuals Indicted for Fatal Shooting in Connection with Marijuana Deal in QueensRead the Press Release
Earlier today, a indictment was unsealed in federal court in Brooklyn charging Jerome Waters, also known as “the Engineer,” Calvin Israel and William Barnett for their alleged roles in the kidnapping, robbery and fatal shooting of a victim in Queens, New York on July 25, 2024. Two of the defendants, Waters and Israel, were arrested today in Maryland, and will be arraigned in the Eastern District of New York at a later date. Barnett remains at large.
Breon Peace, United States Attorney for the Eastern District of New York, James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Thomas G. Donlon, Interim Commissioner, New York City Police Department (NYPD), announced the arrests and charges.
“As alleged, the defendants’ premediated robbery and kidnapping that resulted in a violent death, demonstrates the significant threat of guns and drugs in our communities,” stated United States Attorney Peace. “This Office continues to work nonstop with our law enforcement partners to hold these drivers of violent crime accountable and remove their means to wreak havoc.”
“The three defendants allegedly orchestrated the kidnapping and armed robbery of two individuals in the illicit drug trade, culminating in the murder of one victim. These alleged actions incorporated unnecessary terror and brutality to accomplish their greedy plot," stated FBI Assistant Director in Charge Dennehy. "With the assistance from our law enforcement partners, the FBI will continue its mission apprehending all interstate travelers who pollute our city with drugs and gun violence."
“These arrests are another example of police and their federal partners’ unrelenting pursuit of crews that monetize drugs and brutality," stated NYPD Interim Commissioner Donlon. “I commend our NYPD investigators and all of our law enforcement colleagues for their unwavering commitment to end such barbaric, senseless violence in our communities and for their tireless work to hold all those responsible for it accountable.”
As alleged in court filings, the defendants are members of a Baltimore-based violent robbery crew that conspired to commit an armed robbery and kidnapping of marijuana dealers in Queens, New York. On the night of July 24, 2024 and into July 25, 2024, the defendants drove up from Maryland to New York City for the purpose of kidnapping and robbing at gunpoint John Doe #1 and John Doe #2, who were both drug dealers. Once in New York, Waters and Barnett met with John Doe #1 and John Doe #2 at a stash house in Queens under the guise of purchasing marijuana.
Moments later, Waters and Barnett pulled out guns and held up John Doe #1 and John Doe #2. Next, they invited their co-conspirators into the stash house to assist in the robbery and kidnapping. While in the stash house, the defendants and their co-conspirators tied up John Doe #1 and John Doe #2 with zip ties and forced them outside and into the back of a Jeep and a U-Haul van at gunpoint. At the same time, the defendants and their co-conspirators stole approximately 30 pounds of marijuana from the stash house.
The defendants and their co-conspirators drove John Doe #1 and John Doe #2, who were still tied up, through Queens at gunpoint, demanding drugs and money. Israel drove the U-Haul van containing John Doe #1, who was shot to death multiple times in the head in the back of the U-Haul van. When his body was found by first responders, John Doe #1 still had a zip tie binding one of his hands and was surrounded by bags of marijuana. After the shooting, the defendants fled back to Maryland.
If convicted, Waters, Israel, and Barnett each face mandatory sentences of life imprisonment. The charges in the indictment are allegations, and the defendants are presumed innocent unless and until proven guilty.
This case was brought as part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. As part of the program, U.S. Attorneys’ Offices work in partnership with federal, state, local and tribal law enforcement and their local communities to develop effective, locally based strategies to reduce violent crime.
The government’s case is being handled by the Office’s International Narcotics and Money Laundering Section. Assistant U.S. Attorneys Chand Edwards-Balfour and Adam Amir are in charge of the prosecution.
The Defendants:
JEROME WATERS (also known as “the Engineer”)
Age: 23
MarylandCALVIN ISRAEL
Age: 23
MarylandWILLIAM BARNETT
Age: 27
MarylandE.D.N.Y. Docket No. 24-CR-413 (KAM)
Long Island Child Therapist Charged with Distribution of Child PornographyRead the Press Release
Earlier today, Renee Hoberman, a licensed social worker, was arrested on charges of distribution of child pornography. The defendant was arraigned this afternoon at the federal courthouse in Central Islip before United States Magistrate Judge Arlene R. Lindsay on a complaint and ordered detained.
Breon Peace, United States Attorney for the Eastern District of New York, and William S. Walker, Special Agent in Charge, Homeland Security Investigations, New York (HSI) and Patrick Ryder, Commissioner, Nassau County Police Department announced the charges.
“As alleged, Hoberman distributed heinous and disturbing child pornography, including videos showing infants being restrained and raped. Additionally, while posing as a man, Hoberman, who is a therapist serving children, claimed to have produced child pornography and offered others the opportunity to sexually abuse children,” stated United States Attorney Peace. “Our investigation into Hoberman is ongoing, and we urge anyone with information to contact HSI’s tip line. Together with our law enforcement partners, we will relentlessly pursue predators who victimize children and prosecute them to the fullest extent of the law.”
“Renee Hoberman worked in a trusted position as a therapist with children, making the allegations against her for the possession and distribution of incredibly dark and depraved child sexual abuse materials even more disturbing,” said Special Agent in Charge William S. Walker for Homeland Security Investigations in New York. “HSI is working around the clock with our partners to identify and investigate those who possess and distribute child sexual abuse imagery. Protecting children from predators is of the utmost concern to HSI and the law enforcement community. I urge the public to contact the HSI tip line with any information about this defendant.”
“This case is an example of the vital work our investigators do every day in cooperation with our dedicated partners in federal law enforcement,” said Nassau County Police Commissioner Patrick Ryder. “The hard working and diligent detectives of the Nassau County Police Department will continue to work tirelessly to protect the innocent, and we will never stop fighting to bring those who victimize children to justice.”
As set forth in the complaint, between June 2024 and October 2024, Hoberman allegedly used social media messaging apps to upload digital videos depicting one or more minors engaging in sexually explicit conduct, including several videos of infants six months to one year of age being physically restrained and raped by an adult male, as the infants cried and frantically screamed for the duration of the videos. As recently as on or about October 16, 2024, the defendant uploaded child pornography and engaged in multiple chats concerning child sexual molestation. In these chats, the defendant, purporting to be a man, claimed to have multiple minor children and stated that “he” would have anal sex with the children and would punish them by getting naked, stripping the children naked, and spanking them while the other children watched. The defendant invited another user to visit “his” family in New York to spank the children. In addition, the defendant described sexually abusing “his” children and their friends, and then sent two videos containing child sexual abuse material, claiming that these videos depicted the user’s own children.
According to public records and as alleged in the complaint, Hoberman works as a therapist with an organization based in Melville, New York and serves children aged 0-17.
Anyone with information about sexual exploitation by the defendant is asked to contact HSI at HSI’s tip line: 1-877-4-HSI-TIP or via HSI’s website: https://www.ice.gov/webform/ice-tip-form.
The charges in the complaint are allegations, and the defendant is presumed innocent unless and until proven guilty. If convicted, Hoberman faces a mandatory minimum sentence of five years in prison.
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 https://www.justice.gov/psc.
The government’s case is being handled by the Criminal Section of the Office’s Long Island Division. Assistant United States Attorneys James R. Simmons and Russell Noble are in charge of the prosecution.
The Defendant:
Renee Hoberman, also known as “Rina Hoberman”
Age: 36
Plainview, New YorkE.D.N.Y. Docket No. 24-MJ-588
Seven Members of Moscow-Based Criminal Organization Plead Guilty in over $1.7 Billion International Telemedicine SchemeRead the Press Release
Earlier today, in federal court in Brooklyn, Hafizullah Ebady pleaded guilty to health care fraud conspiracy. The proceeding was held before United States District Judge William F. Kuntz, II. Ebady is the seventh defendant to plead guilty in connection with a sprawling international health care fraud and money laundering scheme. Ebady’s co-defendants Joshua Manuel Alegria, David Gary Bishoff, Brycen Kay Millett, Dela Saidazim, Anthony Santamaria and Hershel Tsikman previously pleaded guilty. An eighth co-defendant and the leader of the organization, Brian Sutton, a U.S. citizen residing in Russia, remains at large.
The defendants participated in an international scheme to acquire pharmacies across the United States with pre-existing relationships with private health insurance companies. Using those pharmacies, in conjunction with call centers to induce individuals to accept unnecessary medications and a network of recruited physicians, the defendants generated more than $1.7 billion in fraudulent prescriptions purportedly filled by the scheme pharmacies. The charges against Sutton and others were announced on November 7, 2023.
Breon Peace, United States Attorney for the Eastern District of New York, and James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the guilty pleas.
“Using aliases, shell companies and straw owners, moving their operations overseas, and laundering millions of dollars through foreign countries, the defendants conducted a sophisticated, multi-faceted scheme, employing scores in call centers and remote billing teams to line their pockets to the tune of more than a billion dollars,” stated United States Attorney Peace. “Health care fraud victimizes American businesses and drives up the cost of care for all. Let these convictions serve as a message: we will work tirelessly to investigate and prosecute those who exploit American health care plans no matter where in the world they operate.”
Mr. Peace expressed his appreciation to the Port Authority of New York and New Jersey, Office of Inspector General, for its work on the case.
As alleged, between 2017 and 2022, Sutton, a U.S. citizen residing in Russia, led his co-defendants in carrying out an international scheme to bill private insurers for over $1.7 billion in fraudulent prescriptions. At Sutton’s direction, the co-conspirators oversaw call centers initially based in Utah, but later operated from Russia and other foreign nations. Call center employees telephoned beneficiaries enrolled in private insurers’ health care plans and offered prescription medications at little to no cost to the beneficiaries and without any medical exam to determine whether the medications were medically necessary. The defendants also recruited doctors purportedly to review prescriptions by nurse practitioners and physician’s assistants after telemedicine visits. Contrary to what the recruited doctors were told, in many cases there were no telemedicine visits between the beneficiaries and any medical professionals. The co-conspirators generated fraudulent prescriptions under the physicians’ names and National Provider Identifier (NPI) numbers. Despite the prescriptions, many beneficiaries never received the medications.
To conceal their involvement, the defendants operated under multiple aliases, funneled hundreds of millions of dollars through pass-through shell companies and straw owners, used end-to-end encrypted communications and moved operations overseas. Specifically, the defendants purchased and operated dozens of existing brick-and-mortar pharmacies through straw owners including in Brooklyn, Staten Island, Manhattan, Long Island, New Jersey, Pennsylvania, Texas, Michigan and Alabama. The co-conspirators also laundered millions of dollars in fraudulent proceeds from overseas through pass-through shell companies that they used to purchase the scheme pharmacies and conceal the defendants’ involvement.
After acquiring the brick-and-mortar pharmacies, the co-conspirators oversaw the installation of pharmacy management software that allowed for the remote submission of reimbursement requests by the scheme pharmacies to private insurers; they also trained and supervised a team of “billers” that remotely submitted hundreds of thousands of reimbursement requests.
Under Sutton’s direction, the defendants played various roles in the scheme, including as follows:
- Alegria oversaw development of custom software and forwarded fraudulent prescriptions to licensed physicians for approval;
- Bishoff coordinated logistics for the operations of multiple scheme pharmacies;
- Ebady coordinated the purchase and directed the day-to-day operations of multiple scheme pharmacies;
- Millett oversaw call centers in Utah, Russia and elsewhere overseas;
- Saidazim recruited licensed physicians and acted as Sutton’s personal assistant;
- Santamaria trained and managed a team of billers to input data and electronically submit fraudulent requests for reimbursement to insurers; and
- Tsikman coordinated the laundering of fraud proceeds through straw owners and shell entities.
Ultimately, the co-conspirators submitted over $1.7 billion in reimbursement requests for over 50 pharmacies. Private insurers paid over $500 million as a result of the fraudulent billing.
When sentenced, the defendants face the following sentences:
- Ebady faces a maximum sentence of 10 years’ imprisonment as well as restitution of more than $195 million and forfeiture of over $1.8 million;
- Alegria faces a maximum sentence of 30 years;
- Bishoff faces a maximum sentence of 10 years as well as forfeiture of $8 million;
- Millett faces a maximum sentence of 30 years as well as forfeiture of over $2.3 million;
- Santamaria faces a maximum sentence of 10 years as well as restitution of more than $520 million and $3.2 million in forfeiture;
- Tsikman faces a maximum sentence of 10 years; and
- Saidazim was sentenced to time served.
The charges pending against Sutton in the superseding indictment are merely allegations and he is presumed innocent unless and until proven guilty.
In July 2022, Mr. Peace was selected as the Chairperson of the White Collar Fraud subcommittee for the Attorney General’s Advisory Committee (AGAC). As the leader of the subcommittee, Mr. Peace plays a key role in making recommendations to the AGAC to facilitate the prevention, investigation and prosecution of various financially motivated, non-violent crimes including health care fraud charges, such as the crimes that the defendants committed.
The government’s case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys John Vagelatos, Jessica K. Weigel, Tara B. McGrath and Jonathan P. Lax are in charge of the prosecution, with assistance from Paralegal Specialists Madison Bates and Asher Martin-Rosenthal. Claire S. Kedeshian of the Office’s Asset Recovery Section is handling forfeiture matters.
The Defendant:
HAFIZULLAH EBADY (also known as “Hafiz Ebady”)
Age: 45
Parsippany, New JerseyCo-Conspirators Who Previously Pleaded Guilty (Awaiting Sentencing):
JOSHUA MANUEL ALEGRIA (also known as “Jboy,” “Jaxon Asher” and “Turk Malloy”)
Age: 32
Woodland Hills, CaliforniaDAVID GARY BISHOFF (also known as “Bobby Fischer”)
Age: 39
Saint George, UtahBRYCEN KAY MILLETT (also known as “Brett Johnson” and “Tommy Wilkinson”)
Age: 33
Saint George, UtahANTHONY SANTAMARIA (also known as “Big Boy,” “Wade Watts,” “Pablo Rodriguez,” “Ryan Rusty” and “Bruce Peter”)
Age: 31
North Hollywood, CaliforniaDELA SAIDAZIM (also known as “Delila,” “Gina Payne” and “Olivia Rothstein”)
Age: 34
Moscow, RussiaHERSHEL TSIKMAN (also known as “Andrew Milner,” “Andrew M.,” “Linus Caldwell,” “Adam Schneider,” “Jonathan Martin” and “H”)
Age: 30
Studio City, CaliforniaCo-Conspirator Who Remains At Large:
BRIAN MICHAEL SUTTON (also known as “Mike Summers,” “Mike Miller” and “Ryan White”)
Age: 31
Moscow, RussiaE.D.N.Y. Docket No. 21-CR-564 (S-3) (WFK)
Former CEO of Abercrombie & Fitch and Two Other Individuals Charged with Sex Trafficking and Interstate ProstitutionRead the Press Release
A 16-count indictment was unsealed today in federal court in Central Islip charging former Abercrombie & Fitch Co. (Abercrombie) Chief Executive Officer Michael Jeffries, along with Matthew Smith and James Jacobson, with sex trafficking and engaging in interstate prostitution. The indictment alleges that between December 2008 and March 2015, Jeffries, Smith and Jacobson used a combination of force, fraud and coercion to traffic men while operating a prostitution enterprise. All three defendants were arrested this morning. Jeffries and Smith are scheduled to make their initial appearances this afternoon in federal court in the Southern District of Florida, and Jacobson is scheduled to make his initial appearance this afternoon in federal court in St. Paul, Minnesota. They will be arraigned in the Eastern District of New York at a later date.
Breon Peace, United States Attorney for the Eastern District of New York, James E. Dennehy, Assistant Director in Charge, New York Field Office (FBI) and Thomas G. Donlon, Interim Commissioner, New York City Police Department (NYPD), announced the arrests and charges.
“As alleged in the indictment, former CEO of Abercrombie Michael Jeffries, his partner Matthew Smith and their recruiter James Jacobson used their money and influence to prey on vulnerable men for their own sexual gratification,” stated United States Attorney Peace. “Today’s arrests show that my Office and our law enforcement partners will not rest until anyone who engages in sex trafficking or interstate prostitution, regardless of their wealth or power, is brought to justice.”
Mr. Peace expressed his thanks to the FBI Miami Field Office, West Palm Beach Resident Agency; the FBI Milwaukee Field Office, Eau Clair Resident Agency; the Barron County, Wisconsin, Sheriff’s Office; and the United States Attorney’s Offices for the Southern District of Florida and the District of Minnesota, for their assistance with the case.
“Today’s indictment highlights the alleged abhorrent behavior of Michael Jeffries, Matthew Smith, and James Jacobson. The defendants allegedly preyed on the hopes and dreams of their victims by exploiting, abusing, and silencing them to fulfill their own desires, with insidious secret intentions. This case is yet another example of individuals using their wealth, power, or reputation to manipulate and control others for their personal gratification. The FBI and our partners won’t allow these criminal acts to go unchecked, we remain committed to investigating and bringing these cases forward to prosecution,” stated FBI Assistant Director in Charge Dennehy.
“Sex trafficking remains a pressing issue nationwide and New York City is no exception,” stated NYPD Interim Commissioner Donlon. “Through our continued partnership with the FBI and the U.S. Attorney for the Eastern District of New York, the NYPD is able to enhance our investigations and secure convictions. Importantly, our close collaboration also allows us to connect survivors of this abhorrent crime with the necessary support and services they deserve.”
From approximately 1992 to 2014, Jeffries was the CEO of Abercrombie, a fashion clothing retailer that owned and operated retail stores around the world. Smith was Jeffries’ life partner. The indictment alleges that Jacobson was employed by Jeffries and Smith to recruit, interview and hire men to perform commercial sex acts for Jeffries and Smith.
As set forth in the indictment, from approximately 2008 to 2015, Jeffries, Smith and Jacobson, together with others, operated an international sex trafficking and prostitution enterprise. Jeffries and Smith not only relied on their financial resources and Jeffries’ power as the CEO of Abercrombie, but also on numerous others, including Jacobson and a network of employees, contractors and security professionals, to operate this venture, which was dedicated to fulfilling their sexual desires.
As further alleged in the indictment, Jeffries and Smith paid for dozens of men to travel within the United States and internationally to various locations, including the Hamptons on Long Island, New York City and hotels in England, France, Italy, Morocco and Saint Barthélémy, for the purpose of engaging in commercial sex acts with Jeffries, Smith and others (the “Sex Events”). Jacobson allegedly traveled throughout the United States and internationally to recruit and interview men for the Sex Events. During “tryouts” of potential candidates, Jacobson typically required that the candidates first engage in commercial sex acts with him.
The indictment alleges that Jeffries, Smith and Jacobson used coercive, fraudulent and deceptive tactics in connection with their sex trafficking and prostitution venture. For example, among other things, Jeffries, Smith, Jacobson and others acting at their direction:
- Employed a referral system and interview process that did not inform men of the details of the Sex Events before they attended, including the full extent and nature of the sexual activity that would be required of the men at the Sex Events;
- Caused men to believe that attending the Sex Events could yield modeling opportunities with Abercrombie or otherwise benefit their careers;
- Caused men to believe that not complying with requests for certain acts during the Sex Events could harm their careers;
- Required men to relinquish their personal items, including clothing, wallets and cellular phones, and store them in an inaccessible location during the Sex Events;
- Required men to sign non-disclosure agreements;
- On more than one occasion when men did not or could not consent, Jeffries and Smith violated the bodily integrity of the men by subjecting them, or continuing to subject them, to invasive sexual and violent contact by body parts and other objects;
- On more than one occasion, Jeffries and Smith directed others to inject, or personally injected, men with an erection-inducing substance for the purpose of causing the men to engage in sex acts the men were incapable or unwilling to engage in.
Many of the victims, at least one of whom was as young as 19 years old, were financially vulnerable and aspired to become models in the fashion industry. Some victims recruited by the defendants had previously worked at Abercrombie stores or had modeled for Abercrombie.
If convicted of the sex trafficking charge, the defendants each face a maximum sentence of life imprisonment and a mandatory minimum sentence of 15 years’ imprisonment. If convicted of the interstate prostitution charges, the defendants face a maximum sentence of 20 years’ imprisonment.
The charges in the indictment are allegations, and the defendants are presumed innocent unless and until proven guilty.
If you believe you are victim of a crime perpetrated by Michael Jeffries, Matthew Smith or James Jacobson, please contact the FBI at 1-800-CALL-FBI.
The government’s case is being handled by the Office’s Civil Rights Section and the Criminal Section of the Office’s Long Island Division. Assistant United States Attorneys Megan Farrell, Erin Reid and Philip Pilmar are in charge of the prosecution with the assistance of Bilingual Victim Witness Specialist Stephanie Marroquin and Fact Witness Services Unit Supervisor/Victim Witness Coordinator Huda Abouchaer.
The Defendants:
MICHAEL JEFFRIES
Age: 80
West Palm Beach, FLMATTHEW SMITH
Age: 61
West Palm Beach, FLJAMES JACOBSON
Age: 71
Rice Lake, WIE.D.N.Y. Docket No. 24-CR-423 (NJC)
af_1_-_indictment.pdfBloods Gang Member Sentenced to 40 Years’ Imprisonment for Double Homicide at Bay Shore Long Island Railroad StationRead the Press Release
Earlier today at the federal courthouse in Central Islip, Lameek Everette, also known as “La,” a member of the Bloods Street gang, was sentenced by United States District Court Judge Gary R. Brown, to 40 years’ imprisonment. On November 27, 2017, Everette was convicted of racketeering, including predicate acts of murder, robbery and attempted robbery. Those charges stemmed from his participation in the September 2, 2016 murders of David Arzu and Janelle Curella, who were each shot by Everette during a robbery as the victims walked to the Long Island Rail Road train station in Bayshore, New York.
Breon Peace, United States Attorney for the Eastern District of New York, William S. Walker, Special Agent in Charge, Homeland Security Investigations (HSI), James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Robert Waring, Acting Commissioner, Suffolk County Police Department (SCPD), announced the sentence.
“What started out as a robbery, turned into a double murder with the defendant pulling the trigger over and over to kill his victims simply because they resisted a holdup. Today the defendant faced a reckoning for the devastating harm he has caused,” stated United States Attorney Peace. “Gang members’ violent choices will not go unpunished in our district. The substantial sentence handed down today provides some measure of justice following the defendant’s senseless murder of a young man and woman whose families still grieve for the loss of their loved ones. I hope it will also deter others from joining gangs and committing brutal crimes that terrorize our community.”
“Lameek Everette’s blatant disregard for human life was clear not only by the execution of two young victims in cold blood, but also by his decision to spend the remainder of his night at a local club,” stated HSI New York Special Agent in Charge Walker. “While no amount of time or justice can bring back David Arzu and Janelle Curella, preventing future violence is of the utmost priority for HSI New York. We will continue to work alongside our law enforcement partners to aggressively pursue violent street gangs and bring them to justice for the greater good of our Long Island community.”
FBI Assistant Director in Charge Dennehy stated, “Lameek Everette personally appraised the lives of two innocent victims to be less than the potential value of their belongings. His callous actions demonstrate the senseless gang violence that can target random civilians. May today's sentencing reflect the FBI's unwavering commitment to eradicate all gang members threatening the welfare of our communities.”
“Gang violence has no place in Suffolk County, and we will continue to work with our law enforcement partners to hold accountable dangerous individuals like Everette whose plan for robbery escalated to murder,” stated Acting SCPD Commissioner Waring. “I hope today’s sentence brings some sense of closure to the victims’ family and serves as a reminder we will pursue justice for all victims.”
At approximately 9:30 p.m. on September 2, 2016, David Arzu, Janelle Curella and two friends were walking towards the Bay Shore train station. Unbeknownst to them, Everette and a fellow Bloods member had devised a plan to rob them at gunpoint, and were lying in wait for them. When Everette and his coconspirator spied Arzu, Curella and their friends, they approached the group, brandished firearms and demanded the victims’ money and valuables. Arzu resisted, and a struggle ensued. When Curella attempted to come to Arzu’s assistance, Everette shot and killed her. Everette then shot Arzu multiple times, killing him. Everette later posted pictures of himself of Facebook, flashing hand signals that signified his affiliation with the Bloods and wearing a necklace he had stolen from Arzu when he murdered him.
Everette’s coconspirator in the robbery, Taheem Smith, was previously sentenced to 27 years’ incarceration for his role in the killings.
This case is part of Project Safe Neighborhoods (PSN), a Department of Justice program that brings together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer. The Department of Justice reinvigorated PSN in 2017 as part of a renewed focus on targeting violent criminals, directing all U.S. Attorneys’ Offices to work in partnership with federal, state, local and tribal law enforcement and the local community to develop effective, locally based strategies to reduce violent crime.
The government’s case is being handled by the Criminal Section of the Office’s Long Island Division. Assistant United States Attorneys Mark E. Misorek and Anthony Bagnuola are in charge of the prosecution.
The Defendant:
LAMEEK EVERETTE
Age: 31
Bay Shore, Long IslandE.D.N.Y. Docket No. 17-CR-504 (GRB)
Raytheon Company to Pay over $950 Million in Connection with Foreign Bribery, Export Control and Defective Pricing SchemesRead the Press Release
BROOKLYN, NY – Raytheon Company (Raytheon), a subsidiary of Arlington, Virginia-based defense contractor RTX (formerly known as Raytheon Technologies Corporation), entered into a three-year deferred prosecution agreement (DPA) with the Department of Justice in connection with a criminal information unsealed today in the Eastern District of New York charging Raytheon with two counts: conspiracy to violate the anti-bribery provision of the Foreign Corrupt Practices Act (FCPA) for engaging in a scheme to bribe a government official in Qatar and conspiracy to violate the Arms Export Control Act (AECA) by willfully failing to disclose the bribes in export licensing applications with the Department of State.
Separately, Raytheon will enter into a three-year deferred prosecution agreement (DPA) in connection with a criminal information filed today in the District of Massachusetts charging Raytheon with two counts of major fraud against the United States. As part of that resolution, Raytheon admitted to engaging in two separate schemes to defraud the Department of Defense (DOD) in connection with the provision of defense articles and services, including PATRIOT missile systems and a radar system.
Both agreements require that Raytheon retain an independent compliance monitor for three years, enhance its internal compliance program, report evidence of additional misconduct to the Justice Department, and cooperate in any ongoing or future criminal investigations.
Raytheon also reached a separate False Claims Act settlement with the department relating to the defective pricing schemes. The Justice Department’s FCPA and ITAR resolution is coordinated with the Securities and Exchange Commission (SEC).
In addition, the Justice Department’s resolutions ensure that the appropriate federal agencies can proceed with determining whether Raytheon or any other individuals or entities associated with the company should be suspended or debarred as federal contractors. Pursuant to the Federal Acquisition Regulations (FAR), when more than one agency has an interest in an entity’s potential suspension or debarment, the FAR requires that the Interagency Suspension and Debarment Committee (ISDC) identify the lead agency for conducting government-wide suspension or debarment proceedings. In connection with this resolution, the Justice Department has referred Raytheon’s factual admissions to the appropriate officials within the Department of Defense to initiate the process with the ISDC to identify which federal agency will take the lead in such administrative proceedings, which occur independently of the Justice Department’s criminal and civil resolutions.
Breon Peace, United States Attorney for the Eastern District of New York; Kevin Driscoll, Deputy Assistant Attorney General Kevin Driscoll of the Justice Department’s Criminal Division; Matthew G. Olsen, Assistant Attorney General for the Justice Department’s National Security Division; Chad Yarbrough, Assistant Director, Criminal Investigative Division, Federal Bureau of Investigation (FBI) and William S. Walker, Special Agent in Charge, U.S. Department of Homeland Security, Homeland Security Investigations (HSI), New York, announced the resolution.
“Over the course of several years, Raytheon employees bribed a high-level Qatari military official to obtain lucrative defense contracts and concealed the bribe payments by falsifying documents to the government, in violation of laws including those designed to protect our national security,” stated United States Attorney Peace. “We will continue to pursue justice against corruption, and as this agreement establishes, enforce meaningful consequences, reforms and monitorship to ensure this misconduct is not repeated.”
Mr. Peace expressed his appreciation to the Securities and Exchange Commission (SEC) and the U.S. Department of State for their work on the case.
“Raytheon engaged in criminal schemes to defraud the U.S. government in connection with contracts for critical military systems and to win business through bribery in Qatar,” stated Deputy Assistant Attorney General Driscoll. “Such corrupt and fraudulent conduct, especially by a publicly traded U.S. defense contractor, erodes public trust and harms the Department of Defense, businesses that play by the rules, and American taxpayers. Today’s resolutions, with criminal and civil penalties totaling nearly $1 billion, reflect the Criminal Division’s ability to tackle the most significant and complex white-collar cases across multiple subject matters.”
“International corruption in military and defense sales is a violation of our national security laws as well as an anti-bribery offense,” stated Assistant Attorney General Olsen. “Raytheon willfully failed to disclose bribes made in connection with contracts that required export licenses. Today’s resolution should serve as a stark warning to companies that violate the law when selling sensitive military technology overseas.”
“The Raytheon Company set out to intentionally defraud the U.S. government,” stated FBI Assistant Director Yarbrough. “This agreement highlights the importance of integrity when it comes to government contracting. The FBI, with its law enforcement partners, will continue to investigate these types of crimes that waste taxpayer dollars and prosecute all those who are intent on cooking up these major fraud schemes.”
“Raytheon Corporation engaged in a systematic and deliberate conspiracy that knowingly and willfully violated U.S. fraud and export laws,” stated HSI New York Special Agent in Charge Walker. “Raytheon’s bribery of government officials, specifically those involved in the procurement of U.S. military technology, posed a national security threat to both the U.S. and its allies. As this investigation reflects, national security continues to be a top priority for HSI New York. The global threats facing the U.S. have never been greater, and HSI New York is committed to working with our federal and international partners to assure sensitive U.S. technologies are not unlawfully and fraudulently acquired.”
The FCPA Case
According to admissions and court documents filed in the Eastern District of New York, between approximately 2012 and 2016, Raytheon, through certain of its employees and agents, engaged in a scheme to bribe a high-level official at the Qatar Emiri Air Force (QEAF), a branch of Qatar’s Armed Forces (QAF) that was primarily responsible for the conduct of air warfare, to assist Raytheon in obtaining and retaining business from the QEAF and QAF. Raytheon entered into and made payments on sham contracts for air defense operations-related studies to corruptly obtain the Qatari official’s assistance in securing certain air defense contracts. Raytheon also entered into a teaming agreement with a Qatari entity to corruptly obtain the Qatari official’s assistance in directly awarding a contract to Raytheon, without a competitive bid, to build a joint operations center that would interface with Qatar’s several military branches.
Under the terms of the DPA, Raytheon will pay a criminal monetary penalty of over $252.3 million, criminal forfeiture of over $36.6 million and retain an independent compliance monitor for three years. In addition, as part of the resolution of the SEC’s parallel investigation, Raytheon will pay approximately $49.1 million in disgorgement and prejudgment interest and a civil penalty of $75 million, $22.5 million of which will be credited against the criminal monetary penalty. The Department has agreed to credit approximately $7.4 million of the disgorgement Raytheon pays to the SEC against the criminal forfeiture.
As part of the DPA, Raytheon and RTX have agreed to continue to cooperate with the U.S. Attorney’s Office for the Eastern District of New York, the Criminal Division’s Fraud Section and the National Security Division’s Counterintelligence and Export Control Section in any ongoing or future criminal investigations relating to this and other conduct. In addition, Raytheon and RTX have agreed to continue to enhance Raytheon’s compliance program.
The Department reached this resolution with Raytheon based on a number of factors, including, among others, the nature and seriousness of the offense. Raytheon received credit for its cooperation with the Department’s investigation, which included:
- Providing information obtained through its internal investigation, which allowed the government to preserve and obtain evidence as part of its own independent investigation;
- Facilitating interviews with current and former employees;
- Making detailed factual presentations to the government;
- Proactively disclosing certain evidence of which the government was previously unaware and identifying key documents in materials it produced; and
- Engaging experts to conduct financial analyses.
Raytheon also engaged in timely remedial measures, including:
- Recalibrating third party review and approval processes to lower company risk tolerance;
- Implementing enhanced controls over sales intermediary payments;
- Hiring empowered subject matter experts to oversee its anti-corruption compliance program and third party management;
- Implementing data analytics to improve third party monitoring; and
- Developing a multipronged communications strategy to enhance ethics and compliance training and communications.
However, in determining the appropriate cooperation credit, the government also took into account the fact that, in the initial phases of the investigation, prior to in or around 2022, Raytheon was at times slow to respond to the government’s requests and failed to provide relevant information in its possession; for example, Raytheon withheld relevant, material information from the government and gave incomplete and misleading presentations regarding the nature and scope of a relevant third-party intermediary relationship.
In light of these considerations, as well as Raytheon’s prior history, which includes three prior civil or regulatory enforcement actions: (i) a 2013 consent agreement with the U.S. State Department concerning civil ITAR and Arms Export Control Act violations, in connection with which Raytheon agreed to hire an independent special compliance officer to oversee the four-year consent decree while at the same time engaging in the conduct described in the DPA; (ii) a civil settlement with the Environmental Protection Agency in 2007 concerning payments to clean up contamination sites; and (iii) a resolution with the SEC in 2006 concerning false and misleading disclosures and improper accounting practices, the criminal penalty calculated under the U.S. Sentencing Guidelines reflects a 20% reduction off the twentieth percentile above the low end of the otherwise applicable Guidelines fine range.
The ITAR Case
According to admissions and court documents filed in the Eastern District of New York, between approximately 2012 and 2016, Raytheon, through certain of its employees and agents, engaged in a scheme to willfully violate the AECA and ITAR Part 130 by failing to disclose to the United States Department of State, Directorate of Defense Trade Controls, fees and commissions paid in connection with two Qatar-related contracts – specifically, the bribes Raytheon paid to the high-level QEAF official through sham subcontracts.
The Department reached this resolution with Raytheon based on a number of factors, including, among others, the nature and seriousness of the offense. Raytheon received credit for its cooperation with the Department’s investigation, which included:
- Gathering evidence of interest to the government and proactively identifying key documents related to willful ITAR-related misconduct;
- Making factual presentations concerning the ITAR-related misconduct; and
- Facilitating witness interviews and expediting the government’s ability to meet with witnesses.
Raytheon also received credit for remediation, which included, in addition to the remediation described above in connection with the FCPA case:
- Hiring additional empowered subject matter experts in legal and compliance;
- Developing a multipronged communications strategy to enhance ethics and compliance training and communications; and
- Making enhancements to its ITAR-related compliance program.
Raytheon did not receive full credit for its cooperation because in the initial phase of the investigation, it failed to provide information relevant to the ITAR violations beyond what was requested in the FCPA investigation.
In light of these considerations, the ITAR-related financial penalty of $21,904,850 includes a cooperation and remediation credit of 20 percent off the otherwise applicable penalty.
The Defective Pricing Case
According to admissions and court documents filed in the District of Massachusetts, from 2012 through 2013 and again from 2017 through 2018, Raytheon employees provided false and fraudulent information to the DOD during contract negotiations concerning two contracts with the United States for the benefit of a foreign partner — one to purchase PATRIOT missile systems and the other to operate and maintain a radar system. In both instances, Raytheon employees provided false and fraudulent information to DOD in order to mislead DOD into awarding the two contracts at inflated prices. These schemes to defraud caused the DOD to pay Raytheon over $111 million more than Raytheon should have been paid on the contracts.
Under the terms of the DPA, Raytheon will pay a criminal monetary penalty of $146,787,972, pay $111,203,009in victim compensation, and retain an independent compliance monitor for three years. The Justice Department has agreed to credit the victim compensation amount against restitution Raytheon pays to the Civil Division in its related, parallel False Claims Act proceeding.
Pursuant to the DPA, in addition to the independent compliance monitor, Raytheon and RTX have agreed to continue to implement a compliance and ethics program at Raytheon designed to prevent and detect fraudulent conduct throughout its operations. Raytheon and RTX have also agreed to continue to cooperate with the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the District of Massachusetts in any ongoing or future criminal investigations.
The Justice Department reached this resolution with Raytheon based on a number of factors, including, among others, the nature and seriousness of the offense conduct, which involved two separate schemes to defraud the U.S. government. Raytheon received credit for its affirmative acceptance of responsibility and cooperation with the department’s investigation, which included (i) facilitating interviews with current and former employees; (ii) providing information obtained through its internal investigation, which allowed the department to preserve and obtain evidence as part of its own independent investigation; (iii) making detailed presentations to the department; (iv) proactively identifying key documents in the voluminous materials collected and produced; (v) engaging experts to conduct financial analyses; and (vi) demonstrating its willingness to disclose all relevant facts by analyzing whether the crime-fraud exception applied to certain potentially privileged documents and releasing the documents that it deemed fell within the exception. However, in the initial phases of the investigation prior to March 2022, Raytheon’s cooperation was limited by unreasonably slow document productions.
Raytheon also engaged in timely remedial measures, including (i) terminating certain employees who were responsible for the misconduct; (ii) establishing a broad defective pricing awareness campaign; (iii) developing and implementing policies, procedures, and controls relating to defective pricing compliance; and (iv) engaging additional resources with appropriate expertise to evaluate and test the new policies, procedures, and controls relating to defective pricing compliance.
In light of these considerations, as well as Raytheon’s prior history, the criminal penalty calculated under the U.S. Sentencing Guidelines reflects a 25% reduction off the tenth percentile above the low end of the otherwise applicable guidelines fine range.
The False Claims Act Settlement
Raytheon also entered into a civil False Claims Act settlement to resolve allegations that it provided untruthful certified cost or pricing data when negotiating prices with the DOD for numerous government contracts and double billed on a weapons maintenance contract.
Under the False Claims Act settlement, which is the second largest government procurement fraud recovery under the Act, Raytheon will pay $428 million for knowingly failing to provide truthful certified cost and pricing data during negotiations on numerous government contracts between 2009 and 2020, in violation of the Truth in Negotiations Act (TINA). Congress enacted TINA in 1962 to help level the playing field in sole source contracts — where there is no price competition — by making sure that government negotiators have access to the cost or pricing data that the offeror used when developing its proposal. As part of the settlement, Raytheon admitted that it failed to disclose cost or pricing data, as required by TINA, regarding its labor and material costs to supply weapon systems to DOD.
Raytheon also admitted that by misrepresenting its costs during contract negotiations it overcharged the United States on these contracts and received profits in excess of the negotiated profit rates. Further, Raytheon admitted that it failed to disclose truthful cost or pricing data on a contract to staff a radar station. Raytheon also admitted that it billed the same costs twice on a DOD contract.As part of the civil resolution, Raytheon received credit under the Justice Department’s guidelines for taking disclosure, cooperation, and remediation into account in False Claims Act cases for cooperation provided by RTX. That cooperation included conducting and disclosing the results of an internal investigation, disclosing relevant facts and material not known to the government but relevant to its investigation, providing the department with inculpatory evidence, conducting a damages analysis, identifying and separating individuals responsible for or involved in the misconduct, admitting liability and accepting responsibility for the misconduct, and improving its compliance programs.
The civil settlement includes the resolution of a lawsuit filed under the qui tam or whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery. The qui tam lawsuit was filed by Karen Atesoglu, a former Raytheon employee, and is captioned United States ex rel. Atesoglu v. Raytheon Technologies Corporation, 21-CV-10690-PBS (D. Mass.). Ms. Atesoglu will receive $4.2 million as her share of the settlement.
* * * * *
In July 2022, Mr. Peace was selected as the Chairperson of the White Collar Fraud subcommittee for the Attorney General’s Advisory Committee (AGAC). As the leader of the subcommittee, Mr. Peace plays a key role in making recommendations to the AGAC to facilitate the prevention, investigation and prosecution of various financially motivated, non-violent crimes including the FCPA.
The FCPA and ITAR investigation was conducted by HSI and the FBI’s International Corruption Unit. The government’s case is being handled by the Office’s Business and Securities Fraud Section, the Criminal Division’s Fraud Section and the National Security Division’s Counterintelligence and Export Control Section. Assistant United States Attorneys David Pitluck, Hiral Mehta and Jessica Weigel are prosecuting the case with Acting Assistant Chief Katherine Raut and Trial Attorney Elina A. Rubin-Smith of the Fraud Section, and Trial Attorneys Christine Bonomo and Leslie Esbrook of the Counterintelligence and Export Control Section, with assistance from Eastern District of New York Paralegal Specialist Liam McNett.
The Defendant:
THE RAYTHEON COMPANY
Waltham, MassachusettsE.D.N.Y. Docket No.: 24-CR-399 (RER)
Líderes de un peligroso cartel de drogas mexicano, responsables de violencia extrema, acusados de delitos de tráfico internacional de drogas y uso de armas de fuegoRead the Press Release
Hoy en el Distrito de Columbia se hizo pública una acusación formal que señala a líderes de la violenta organización de narcotráfico, conocida como Los Zetas, y su organización sucesora, el Cartel del Noreste (CDN), de participar en una empresa criminal continua; asociación ilícita para traficar drogas; delitos de armas de fuego; y asociación ilícita para lavado de dinero internacional.
Según la acusación, Miguel Treviño Morales, de 51 años, y su hermano, Omar Treviño Morales, de 48 años, también conocidos respectivamente como Z-40 y Z-42, presuntamente asumieron el control de Los Zetas después de más de una década de ser miembros de la violenta organización de narcotráfico. Los Zetas anteriormente sirvieron como un brazo armado militarista para el Cartel del Golfo para mantener el control de las rutas de narcotráfico en todo México. Desde que se convirtieron en líderes de Los Zetas en 2012, que luego renombraron como Cartel del Noreste, se alega que los acusados han continuado su historia y patrón de utilizar violencia extrema para controlar grandes extensiones del norte de México, incluso por la frontera con EE. UU. Según las denuncias en la acusación formal, Miguel y Omar Treviño Morales fueron encarcelados en México en 2013 y 2015, respectivamente, pero continuaron controlando el CDN por diversos medios, entre ellos la colocación de varios familiares para dirigir las operaciones en su representación. Se alega que Miguel y Omar Treviño Morales son personalmente responsables de cometer decenas de asesinatos y de dirigir asesinatos, secuestros y actos de tortura por parte de miembros de Los Zetas y CDN para promover y proteger las actividades de narcotráfico del Cartel y enriquecer a sus miembros.
De ser condenados, los acusados enfrentan una pena máxima de cadena perpetua. Un juez de un tribunal de distrito federal determinará la sentencia correspondiente tras considerar las Pautas de Sentencia de EE. UU. y otros factores legales.
“Como se alega en la acusación formal, los acusados dirigieron una organización de narcotráfico transnacional que fue responsable de cometer violencia extrema y de traficar enormes cantidades de narcóticos a Estados Unidos,” dijo Nicole Argentieri, vicefiscal general adjunta principal, jefa de la División Penal del Departamento de Justicia. “El Departamento de Justicia se compromete a responsabilizar a los líderes de carteles, como los acusados, por envenenar comunidades estadounidenses y alimentar la violencia aquí y en el extranjero. También estamos comprometidos a colaborar con nuestros colegas nacionales e internacionales en este esfuerzo y agradecemos a nuestros colegas, las autoridades mexicanas de procuración de justicia, por su continua colaboración en este caso.”
“Esta formulación complementaria de cargos reitera el compromiso del Departamento de Justicia de perseguir a los líderes de los carteles de drogas más peligrosos del mundo, sin importar el tiempo que lleve,” dijo Breon Peace, fiscal de EE. UU. para el Distrito Este de Nueva York. “Los prolíficos crímenes y actos extremos de violencia de los acusados han convulsionado al Distrito Este de Nueva York y a todo el país, y anticipamos responsabilizar a los acusados en un tribunal de justicia de EE. UU.”
“Durante décadas, estas personas han controlado una de las organizaciones de drogas más violentas de México, cometiendo y dirigiendo la comisión de atrocidades horribles contra nuestros vecinos, el pueblo de México, y también en Estados Unidos,” dijo Jaime Esparza, el fiscal de EE. UU. para el Distrito Oeste de Texas. “Nada es más importante que llevar ante la justicia a individuos peligrosos como estos. Esperamos trabajar con el gobierno de México para llevar a estos brutales líderes del Cartel ante la justicia por los numerosos crímenes que han cometido.”
“La Oficina de Investigaciones de Seguridad Nacional (HSI) se une a nuestros colegas en la lucha contra organizaciones criminales transnacionales para proteger a nuestros ciudadanos de las acciones ilegales de estas,” dijo Katrina W. Berger, directora ejecutiva asociada de HSI. “El daño causado por el cartel de Los Zetas va mucho más allá de nuestras fronteras, perjudicando comunidades y arruinando vidas aquí en Estados Unidos.”
“Durante décadas, Los Zetas operaron como una de las organizaciones de narcotráfico más violentas en Estados Unidos y México bajo la dirección de los hermanos Miguel (Zeta 40) y Omar (Zeta 42) Treviño Morales. La DEA no ha flaqueado nunca en la lucha global contra este brutal y despiadado cartel, que prosperó a raíz de la devastación que causaron en las comunidades estadounidenses,” dijo Daniel C. Comeaux, el agente especial a cargo de la División de Houston de la DEA. “A través de innumerables investigaciones, la DEA ha llevado ante la justicia a miembros de alto rango de esta organización destructiva. Estas últimas acusaciones formales continuarán debilitando a esta violenta organización y la forzarán a dejar el control que han ejercido a lo largo de la frontera suroeste de Estados Unidos.”
La División de Houston de la DEA lideró esta investigación con la asistencia de la Oficina de la DEA en Ciudad de México. La Oficina de HSI Nueva York contribuyó sustancialmente a la investigación, al igual que las siguientes: DEA San Antonio, DEA Eagle Pass, DEA Del Río, DEA Laredo, DEA Nueva York, la Oficina Regional del FBI en Washington, FBI El Paso, FBI San Antonio, FBI Laredo, FBI Del Río, HSI San Antonio, HSI Del Río, HSI Laredo, el Departamento de Seguridad Pública de Texas, los Rangers de Texas, el Departamento de Policía de San Antonio, la Oficina del Sheriff del Condado de Bexar [Texas], la Oficina de Alcohol, Tabaco, Armas de Fuego y Explosivos (ATF) San Antonio, ATF Laredo, Investigación Criminal del IRS (IRS-CI) San Antonio, IRS-CI Waco y la Patrulla Fronteriza de EE. UU.
La Oficina de Asuntos Internacionales del Departamento de Justicia y la Oficina de Operaciones de Cumplimiento de la División Criminal proporcionaron asistencia significativa en este caso.
Los fiscales litigantes Kirk Handrich y Tara Arndt de la Unidad de Narcóticos y Drogas Peligrosas de la División Penal, numerosos fiscales del Distrito Oeste de Texas y el fiscal adjunto de EE. UU. Andrew Wang para el Distrito Este de Nueva York están procesando el caso.
Este caso es parte de una operación de la Fuerza Especial de Lucha contra la Droga y la Delincuencia Organizada (OCDETF). La OCDETF identifica, interrumpe y desmantela a los narcotraficantes de más alto nivel, lavadores de dinero, pandillas y organizaciones criminales transnacionales que amenazan a Estados Unidos, utilizando un enfoque multiinstitucional, liderado por fiscales e informado por datos de inteligencia.
Una acusación formal es tan solo una denuncia. Todos los acusados se presumen inocentes hasta que se demuestre su culpabilidad más allá de toda duda razonable en un tribunal de justicia.
Leaders of Dangerous Mexican Drug Cartel Responsible for Extreme Violence Charged with International Drug Trafficking and Firearms OffensesRead the Press Release
Note: View the fifth superseding indictment here.
An indictment was unsealed in the District of Columbia charging leaders of the violent drug trafficking organization known as Los Zetas, and its successor organization, Cartel del Noreste (CDN), with engaging in a continuing criminal enterprise; drug trafficking conspiracy; firearms offenses; and international money laundering conspiracy.
According to the indictment, Miguel Trevino Morales, 51, also known as Z-40, and his brother, Omar Trevino Morales, 48, also known as Z-42, allegedly assumed control of Los Zetas after more than a decade as members of the violent drug trafficking organization. Los Zetas previously served as an armed militaristic wing for the Gulf Cartel to maintain control of drug trafficking routes throughout Mexico. Since becoming leaders of Los Zetas in 2012, which they later renamed the Cartel del Noreste, the defendants have allegedly continued its history and pattern of using extreme violence to control large swaths of Northern Mexico, including along the U.S. border. Based on allegations in the indictment, Miguel and Omar Trevino Morales were incarcerated in Mexico in 2013 and 2015, respectively, but continued to control the CDN through various means, including by installing various family members to run operations at their behest. Miguel and Omar Trevino Morales are alleged to be personally responsible for committing dozens of murders and for directing assassinations, kidnappings, and acts of torture by Los Zetas and CDN members to promote and protect the Cartel’s drug trafficking activities and enrich its members.
“As alleged in the indictment, the defendants ran a transnational drug trafficking organization that was responsible for committing extreme violence and trafficking massive quantities of narcotics into the United States,” said Principal Deputy Assistant Attorney General Nicole Argentieri, head of the Justice Department’s Criminal Division. “The Justice Department is committed to holding cartel leaders like the defendants accountable for poisoning American communities and fueling violence here and abroad. We are also committed to working with our domestic and international colleagues in this effort, and we are grateful to our Mexican law enforcement partners for their ongoing collaboration in this case.”
“This superseding indictment underscores the Justice Department’s commitment to pursuing the leaders of the world’s most dangerous drug cartels, no matter how long it takes,” said U.S. Attorney Breon Peace for the Eastern District of New York. “The defendants’ prolific crimes and extreme acts of violence have wreaked havoc in the Eastern District of New York and across the country, and we look forward to holding the defendants accountable in a U.S. court of law.”
“For decades, these individuals have controlled one of the most violent drug organizations in Mexico, committing and directing the commission of horrible atrocities against our neighbors, the people of Mexico, and also in the United States,” said U.S. Attorney Jaime Esparza for the Western District of Texas. “Nothing is more important than bringing dangerous individuals like this to justice. We look forward to working with the government of Mexico in bringing these brutal Cartel leaders to justice for the numerous crimes they have committed.”
“Homeland Security Investigations (HSI) stands with our partners in the fight against transnational criminal organizations to protect our citizens from their unlawful actions,” said HSI Executive Associate Director Katrina W. Berger. “The harm caused by the Los Zetas cartel reaches well beyond our borders, hurting communities and ruining lives here in the United States.”
“For decades, Los Zetas operated as one of the most violent drug trafficking organizations in the United States and Mexico under the direction of brothers Miguel (Zeta 40) and Omar Trevino Morales (Zeta 42),” said Special Agent in Charge Daniel C. Comeaux of the Drug Enforcement Administration (DEA) Houston Field Division. “The DEA has never wavered from the global fight against this vicious, ruthless cartel which thrived on the devastation they imparted on American communities. Through countless investigations, DEA brought high-ranking members of this destructive organization to justice. These latest indictments will continue to cripple this violent organization and force them to release the stranglehold they have exerted along the southwest border of the United States.”
If convicted, the defendants face a maximum penalty of life in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The DEA Houston Division investigated the case, with assistance from the DEA Mexico City Country Office. HSI New York contributed substantially to the investigation, as did the following: DEA San Antonio Division, DEA Eagle Pass Division, DEA Del Rio Division, DEA Laredo Division, DEA New York Division, FBI Washington Field Office, FBI El Paso Field Office, FBI San Antonio Field Office, FBI Laredo Field Office, FBI Del Rio Field Office, HSI San Antonio, HSI Del Rio, HSI Laredo, Texas Department of Public Safety, Texas Rangers, San Antonio Police Department, Bexar County Sherriff’s Office, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) San Antonio Field Division, ATF Laredo Field Division, IRS Criminal Investigation (IRS-CI) San Antonio, IRS-CI Waco, and the U.S. Border Patrol.
The Justice Department’s Office of International Affairs and Criminal Division’s Office of Enforcement Operations provided significant assistance in this case.
Trial Attorneys Kirk Handrich and Tara Arndt of the Criminal Division’s Narcotic and Dangerous Drug Section, numerous prosecutors for the Western District of Texas, and Assistant U.S. Attorney Andrew Wang for the Eastern District of New York are prosecuting the case.
This case is part of an Organized Crime and Drug Enforcement Task Force (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Ex-Mexican Secretary of Public Security Genaro Garcia Luna Sentenced to over 38 Years' ImprisonmentRead the Press Release
Genaro Garcia Luna, the former Secretary of Public Security in Mexico from 2006 to 2012, was sentenced today by United States District Judge Brian M. Cogan to 460 months’ imprisonment and a $2 million fine for his decade-long assistance to the Sinaloa Cartel in exchange for millions of dollars in bribes. Following a four-week trial in February 2023, Garcia Luna was convicted by a jury of engaging in a continuing criminal enterprise, international cocaine distribution conspiracy, conspiracy to distribute and possess with intent to distribute cocaine, conspiracy to import cocaine and making false statements.
Breon Peace, United States Attorney for the Eastern District of New York, Anne Milgram, Administrator, U.S. Drug Enforcement Administration (DEA), and Katrina W. Berger, Executive Associate Director, Homeland Security Investigations (HSI), announced the verdict.
“Today’s sentencing of Genaro Garcia Luna is a critical step in upholding justice and the rule of law. His betrayal of the public trust and the people he was sworn to protect resulted in more than one million kilograms of lethal narcotics imported into our communities and unleashed untold violence here and in Mexico. This sentence sends a strong message that no one, regardless of their position or influence, is above the law.” stated United States Attorney Peace. “After years of destructive narcotrafficking and deceit, Garcia Luna will spend nearly 40 years where he belongs: federal prison.”
“Today’s sentencing of Mexico’s former Secretary of Public Security, Genaro Garcia Luna, sends a clear message to corrupt leaders around the world who use their positions of power to help the cartels: no amount of power will shield you from justice,” said DEA Administrator Anne Milgram. “Garcia Luna accepted millions of dollars in bribes from the Sinaloa Cartel to allow millions of kilograms of cocaine to flood the streets of the United States. Instead of protecting the citizens of Mexico, Garcia Luna was protecting drug cartels. The DEA will continue to relentlessly pursue drug trafficking organizations and those who protect them.”
“Today’s sentencing sends a powerful message that no one is above the law,” said HSI Executive Associate Director Katrina W. Berger. “HSI continues its partnered commitment to disrupting and dismantling the criminal networks responsible for bringing deadly narcotics into the U.S.”
As proven at trial, from 2006 to 2012, Garcia Luna was Mexico’s top law enforcement official, serving as Secretary of Public Security and, in that capacity, controlled Mexico’s Federal Police Force. Previously, from 2001 to 2005, the defendant was the head of Mexico’s Federal Investigative Agency (AFI). The defendant used his official positions to assist the violent Sinaloa Cartel (the Cartel) in exchange for millions of dollars in bribes. Garcia Luna’s conduct included facilitating safe passage of the Cartel’s drug shipments, providing sensitive law enforcement information about investigations into the Cartel and helping the Cartel attack rival drug cartels, thereby facilitating the importation of multi‑ton quantities of cocaine and other drugs into the United States.
In exchange for bribes, the defendant’s Federal Police Force acted as bodyguards and escorts for the Cartel, allowing Cartel members to wear police uniforms and badges and helping to unload shipments of cocaine from planes at Mexico City’s airport, then delivering the cocaine to the Cartel. The defendant was paid in U.S. currency, stuffed variously in suitcases, briefcases and duffel bags. The bribe amounts increased over the years as the Sinaloa Cartel grew in size and power through the assistance of the defendant. Former members of the Cartel testified that bribe money was handed off to the defendant in a variety of locations, including at a “safe house” located in Mexico City where large amounts of cash were hidden in a false wall, at a car wash in Guadalajara and at a French restaurant in Mexico City across the street from the U.S. Embassy. Further, in exchange for the millions of dollars in bribes, the defendant’s Federal Police Force leaked sensitive information that enabled the Cartel to evade detection by law enforcement or use the information in attacks on rival traffickers. Finally, after moving to the United States in 2012, Garcia Luna submitted an application for naturalization in 2018, in which he lied about his past criminal conduct on behalf of the Cartel in an attempt to become a U.S. citizen.
In connection with post-trial proceedings, the Court also found that, while he was awaiting sentencing, Garcia Luna obstructed justice when he sought to bribe fellow inmates to provide false testimony in an attempt to overturn the jury’s verdict.
The investigation was led by the New York Strike Force, a crime-fighting unit comprising federal, state and local law enforcement agencies supported by the Organized Crime Drug Enforcement Task Force and the New York/New Jersey High Intensity Drug Trafficking Area. The Strike Force is based at the DEA’s New York Division and includes agents and officers of the DEA, New York City Police Department, New York State Police, Homeland Security Investigations, U.S. Internal Revenue Service Criminal Investigation Division, Bureau of Alcohol, Tobacco, Firearms and Explosives, U.S. Customs and Border Protection, U.S. Secret Service, United States Marshals Service, New York National Guard, Clarkstown Police Department, U.S. Coast Guard, Port Washington Police Department and New York State Department of Corrections and Community Supervision.
HSI New York’s El Dorado Task Force (EDTF) played an important role in this investigation. The EDTF is comprised of more than 200 law enforcement personnel representing approximately thirty-five (35) federal, state, and local law enforcement and regulatory agencies, including the DEA.
The government’s case is being handled by the Office’s International Narcotics and Money Laundering Section. Assistant U.S. Attorneys Saritha Komatireddy, Erin Reid, Ryan C. Harris, Philip Pilmar and Adam Amir are in charge of the prosecution, with the assistance of Paralegal Specialists Huda Abouchaer and Melissa Bennett.
The Defendant:
GENARO GARCIA LUNA
Age: 56
Miami, FloridaE.D.N.Y. Docket No. 19-CR-576 (S-1) (BMC)
Ex Secretario De Seguridad Pública Mexicana Genaro Garcia Luna Condenado a Mas De 38 Años De PrisiónRead the Press Release
Genaro García Luna, ex secretario de Seguridad Pública de México de 2006 a 2012, ha sido condenado hoy por el juez de distrito de Estados Unidos Brian M. Cogan a 460 meses de prisión y una multa de 2 millones de dólares por su ayuda durante una década al cártel de Sinaloa a cambio de millones de dólares en sobornos. Tras un juicio de cuatro semanas en febrero de 2023, García Luna fue declarado por un jurado culpable de participar en una organización criminal continue, conspiración para la distribución internacional de cocaína, conspiración para distribuir y posesión con intención de distribuir cocaína, conspiración para importar cocaína, y hacer declaraciones falsas.
Breon Peace, Fiscal de los Estados Unidos para el Distrito Este de Nueva York, Anne Milgram, Administradora de la Agencia Antidroga de los Estados Unidos (DEA), y Katrina W. Berger, Directora Ejecutiva Asociada de Investigaciones de Seguridad Nacional (HSI), anunciaron el veredicto.
"La sentencia dictada hoy contra Genaro García Luna es un paso fundamental en la defensa de la justicia y el Estado de Derecho. Su traición a la confianza pública y a las personas a las que había jurado proteger dio lugar a la importación de más de un millón de kilogramos de estupefacientes letales en nuestras comunidades y desató una violencia incalculable aquí y en México. Esta sentencia envía un mensaje contundente de que nadie, independientemente de su posición o influencia, está por encima de la ley," declaró el Fiscal de los Estados Unidos Peace. "Tras años de engaño y narcotráfico destructivo, García Luna pasará casi 40 años donde debe de estar: en una prisión federal".
"La sentencia dictada hoy contra el ex Secretario de Seguridad Pública de México, Genaro García Luna, envía un mensaje claro a los líderes corruptos de todo el mundo que utilizan sus posiciones de poder para ayudar a los cárteles: ningún poder les protegerá de la justicia", declaró la administradora de la DEA, Anne Milgram. "García Luna aceptó millones de dólares en sobornos del Cártel de Sinaloa para permitir que millones de kilogramos de cocaína inundaran las calles de Estados Unidos. En lugar de proteger a los ciudadanos de México, García Luna protegía a los cárteles de la droga. La DEA seguirá persiguiendo implacablemente a las organizaciones de narcotraficantes y a quienes las protegan."
"La sentencia dictada hoy envía un poderoso mensaje de que nadie está por encima de la ley", declaró Katrina W. Berger, Directora Ejecutiva Asociada de HSI. "HSI continúa con su compromiso conjunto de desarticular y desmantelar las redes delictivas responsables de introducir narcóticos mortales en Estados Unidos."
Como se demostró en el juicio, de 2006 a 2012, García Luna fue el máximo responsable de la aplicación de la ley en México, ocupando el cargo de Secretario de Seguridad Pública y, como tal, controlaba la Policía Federal de México. Anteriormente, de 2001 a 2005, el acusado fue jefe de la Agencia Federal de Investigación (AFI) de México. El acusado utilizó sus cargos oficiales para ayudar al violento Cártel de Sinaloa (el Cártel) a cambio de millones de dólares en sobornos. Las actividades de García Luna incluían facilitar el paso seguro de los cargamentos de droga del Cártel, proporcionar información confidencial acerca de las fuerzas de seguridad y sus investigaciones del Cártel, y ayudar al Cártel a atacar a otros cárteles de droga rivales, facilitando así la importación de cantidades de varias toneladas de cocaína y otras drogas a Estados Unidos.
A cambio de sobornos, la Policía Federal del acusado actuaba como guardaespaldas y escolta del cártel, permitiendo a los miembros del cártel llevar uniformes e insignias policiales y ayudando a descargar los cargamentos de cocaína de los aviones en el aeropuerto de Ciudad de México, para después entregar la cocaína al Cártel. Al acusado se le pagó en moneda estadounidense, metida en varias maletas, portafolios, y bolsas de lona. Las cantidades de los sobornos aumentaron a lo largo de los años a medida que el cártel de Sinaloa crecía en tamaño y poder gracias a la ayuda del acusado. Antiguos miembros del cártel testificaron que el dinero de los sobornos se le entregaba al acusado en diversos lugares, como en una "casa segura" situada en Ciudad de México, donde se ocultaban grandes cantidades de dinero en efectivo en una pared falsa, en un lavadero de coches de Guadalajara, y en un restaurante francés de Ciudad de México situado frente a la embajada de Estados Unidos. Además, a cambio de los millones de dólares en sobornos, la Policía Federal que el demandado lideraba filtró información confidencial que permitió al Cártel eludir la detección por parte de las fuerzas de seguridad, o utilizar dicha información en ataques contra traficantes rivales. Finalmente, después de mudarse a Estados Unidos en 2012, García Luna presentó una solicitud de naturalización en 2018, en la que mintió sobre su conducta criminal pasada en nombre del Cártel en un intento por convertirse en ciudadano estadounidense.
En relación con los procedimientos posteriores al juicio, el Tribunal también determinó que, mientras esperaba la sentencia, García Luna obstruyó la justicia cuando intentó sobornar a otros reclusos para que prestaran falso testimonio en un intento de anular el veredicto del jurado.
La investigación fue dirigida por la New York Strike Force, una unidad de lucha contra la delincuencia compuesta por organismos policiales federales, estatales y locales que cuenta con el apoyo de la Organized Crime Drug Enforcement Task Force y la New York/New Jersey High Intensity Drug Trafficking Area. La Strike Force tiene su base en la División de Nueva York de la DEA y cuenta con agentes y funcionarios de la DEA, el Departamento de Policía de la Ciudad de Nueva York, la Policía del Estado de Nueva York, Investigaciones de Seguridad Nacional, la División de Investigación Criminal del Departamento de Hacienda, la Oficina de Alcohol, Tabaco, Armas de Fuego y Explosivos, Aduanas y Protección de Fronteras de EE.UU., el Servicio Secreto de EE.UU., el Servicio de Alguaciles de Estados Unidos, la Guardia Nacional de Nueva York, el Departamento de Policía de Clarkstown, la Guardia Costera de EE.UU., el Departamento de Policía de Port Washington, y el Departamento de Correccionales y Supervisión Comunitaria del Estado de Nueva York.
La El Dorado Task Force (EDTF) de HSI en Nueva York desempeñó un papel importante en esta investigación. La EDTF está compuesta por más de 200 miembros de las fuerzas del orden que representan a unos treinta y cinco (35) organismos policiales y reguladores federales, estatales y locales, incluida la DEA.
El caso del gobierno está siendo tramitado por la Sección Internacional de Estupefacientes y Lavado de Dinero de la Oficina. Los fiscales adjuntos Saritha Komatireddy, Erin Reid, Ryan C. Harris, Philip Pilmar y Adam Amir están a cargo de la acusación, con la asistencia de las paralegales especialistas Huda Abouchaer y Melissa Bennett.
El Acusado:
GENARO GARCIA LUNA
Edad: 56
Miami, FloridaE.D.N.Y. Expediente No.: 19-CR-576 (S-1) (BMC)
Member of Bonanno Crime Family Convicted of Extortion of a WitnessRead the Press Release
Today, a federal jury in Brooklyn convicted John Ragano, also known as “Bazoo,” a member of the Bonanno organized crime family, for the extortionate collection of credit from a victim. The verdict followed a four-day trial before United States District Judge Hector Gonzalez. When sentenced, Ragano faces up to 20 years in prison. The defendant was acquitted of extortionate collection of credit conspiracy, witness harassment and witness tampering.
Breon Peace, United States Attorney for the Eastern District of New York, and James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the verdict.
“The defendant’s extortion of a victim while on pre-trial release, carried out even in the sanctity of the federal courthouse, is an affront to the criminal justice system and a glaring example of this Bonanno mobster’s flagrant disrespect for the law,” stated United States Attorney Peace. “With today’s verdict, the jury has delivered a clear message that the rule of law will prevail over extortionate threats.”
“Despite previous arrests and detention, John Ragano tormented his victim to make weekly exorbitant loan payments and enforced humiliating methods when faced with resistance,” stated FBI Assistant Director in Charge Dennehy. “His actions reflected his apathy to the criminal justice system as he repeatedly attempted to extort his victims in the midst of active legal proceedings. Today’s verdict emphasizes the FBI’s intolerance of the mob’s historical inclination to utilize coercive and threatening tactics to fulfill their greedy demands.”
In early 2021, John Doe (“the victim”) borrowed $150,000 from Ragano and made interest payments of approximately $1,800 a week to him. On September 14, 2021, Ragano was arrested in connection with the extortionate loan to the victim, as well as separate schemes to traffic marijuana and commit fraud. While Ragano was on pre-trial detention in that case, and after he was released on bond from the Metropolitan Detention Center in December 2021, he continued to try to collect the 2021 loan from the victim. On November 28, 2022, Ragano pleaded guilty in connection with his loan to the victim. In 2022 and 2023, despite Ragano’s arrest, court supervision, guilty plea and sentence of 57 months’ imprisonment, he continued to extort the victim on the 2021 loan, including at status conferences held at the federal courthouse.
On March 25, 2023, the victim recorded a meeting with Co-Conspirator #1 who explained that Ragano wanted the entire amount of the loan repaid and that “nobody’s looking for anybody to get hurt.” On July 5, 2023, the victim went to a used auto parts yard where Ragano worked to discuss the loan and recorded the meeting. The victim told Ragano that he was going to stop repaying the loan. Ragano accused the victim of cooperating with the government and demanded that he remove all his clothes. Ragano stated: “Okay, well then take off your f-----g s—t right now my man. Take off your f-----g pants right now, lemme see, I want to see.” At Ragano’s insistence, the victim complied and took off all his clothing. At that point, two men at the business walked up behind Ragano, one of whom was holding metal tools. Ragano then demanded the victim pay the money the defendant believed he was owed. Despite being forced to strip naked, the victim was still able to record the confrontation.
The government’s case is being handled by the Office’s Organized Crime and Gangs Section. Assistant United States Attorneys Devon Lash and Andrew D. Reich are in charge of the prosecution with the assistance of Paralegal Specialist Kristina Kim.
The Defendant:
JOHN RAGANO
Age: 62
Franklin Square, Long IslandE.D.N.Y. Docket No. 24-CR-50 (HG)
Eight Individuals Charged in $68 Million Social Adult Day Care and Home Health Care SchemeRead the Press Release
An indictment was unsealed today in federal court in Brooklyn charging eight defendants for their alleged roles in a scheme to defraud Medicaid of approximately $68 million through the operation of two Brooklyn-based social adult day cares and a home health care financial intermediary that were paying kickbacks and bribes for services that were not provided. The defendants were arrested this morning and are scheduled to be arraigned this afternoon before United States Magistrate Judge Lois Bloom.
Breon Peace, United States Attorney for the Eastern District of New York; Nicole M. Argentieri, Principal Deputy Assistant Attorney General and head of the Justice Department’s Criminal Division; Naomi Gruchacz, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG); William S. Walker, Special Agent in Charge, Homeland Security Investigations, New York (HSI); and Thomas G. Donlon, Interim Commissioner, New York City Police Department (NYPD), announced the arrests and charges.
“Social adult day care and home health services are meant to help seniors, but as alleged, the defendants allegedly turned their businesses into a brazen cash grab of millions of dollars from the Medicaid program,” stated United States Attorney Peace. “My Office is committed to investigating and prosecuting those who plunder taxpayer-funded, federal health care programs dollars while purporting to offer health care services.”
“As alleged in the indictment, these defendants orchestrated a years-long scheme to defraud Medicaid of tens of millions of dollars for social adult day care and home care services for seniors that they did not provide,” said Principal Deputy Assistant Attorney General Nicole M. Argentieri, head of the Justice Department’s Criminal Division. “The defendants allegedly paid cash bribes and kickbacks to recruiters and Medicaid recipients as part of a scheme to enrich themselves at the expense of vital programs for senior citizens. Today’s charges make clear that the Criminal Division will not tolerate schemes that brazenly steal from federal health care programs.”
“HHS-OIG is committed to working with our law enforcement partners to investigate allegations that bribes and kickbacks are paid with Medicaid monies,” stated HHS-OIG Special Agent in Charge Gruchacz. “Individuals and entities that participate in the federal health care system are required to obey the laws meant to preserve the integrity of program funds and the provision of appropriate, quality services to patients.”
“As alleged, the defendants saw nothing beyond the dollar signs associated with their crimes, and in turn defrauded the U.S. government of $68 million in welfare funds meant for one of our country’s most vulnerable populations,” stated HSI New York Special Agent in Charge Walker. “Today’s announcement underscores the HSI New York El Dorado Task Force’s unrelenting focus on dismantling and disrupting financial fraud schemes that exploit the American public and hurt our economy.”
“The crimes outlined in this indictment take advantage of a network that offers essential health care and other services to those in need,” stated Interim NYPD Commissioner Donlon. “Let it be clear: Anyone who attempts to profit by defrauding the system will face consequences, as these schemes drain already limited resources and deprive beneficiaries of crucial funds. I commend our NYPD investigators and federal law enforcement partners for their successful and continued collaboration.”
According to court documents, beginning in approximately October 2017, the defendants Zakia Khan and Ahsan Ijaz owned and operated two Brooklyn-based social adult day cares, Happy Family Social Adult Day Care, Inc. (Happy Family) and Family Social Adult Day Care, Inc. (Family Social), and a financial intermediary, Responsible Care Staffing, Inc. (Responsible Care), for the New York Medicaid Consumer Directed Personal Assistance Program (CDPAP), which permits family members of Medicaid recipients to receive payment for assisting Medicaid recipients with activities of daily living. In exchange for kickbacks and bribes, marketers Elaine Antao, Omneah Hamdi, and Manal Wasef referred Medicaid recipients to Happy Family, Family Social and/or Responsible Care. The marketers in turn allegedly paid kickbacks and bribes to Medicaid recipients for social adult day care and CDPAP services that Happy Family, Family Social and Responsible Care billed to Medicaid but were not provided or were induced by kickbacks and bribes. Ansir Abassi and Amran Hashmi managed Happy Family and Family Social and the marketers. To carry out the kickback scheme, Khan, Antao, Ijaz, Abassi and Hamdi allegedly used business entities to launder the fraud proceeds and generate the cash used to pay kickbacks and bribes. Seema Memon, an employee of Happy Family who was previously charged by complaint on July 1, 2024, was also indicted for conspiracy to commit health care fraud.
Most of the New York Medicaid recipients enrolled at Happy Family and Family Social were paid illegal cash kickbacks and bribes and did not actually visit Happy Family or Family Social or receive CDPAP services arranged through Responsible Care on the purported dates of service as claimed to New York Medicaid/Managed Long Term Care plans. In some instances, the Medicaid recipients were outside the United States on the purported dates of service.
Khan is charged with conspiracy to commit health care fraud, health care fraud, conspiracy to defraud the United States and to pay and receive health care kickbacks, paying health care kickbacks, conspiracy to commit money laundering and money laundering. If convicted, she faces a maximum penalty of 20 years in prison for each count of conspiracy to commit money laundering and money laundering, 10 years in prison for each count of conspiracy to commit health care fraud, health care fraud and paying health care kickbacks and five years in prison for conspiracy to defraud the United States and to pay and receive health care kickbacks.
Abassi, Antao, Hamdi and Ijaz are charged with conspiracy to commit health care fraud, conspiracy to defraud the United States and to pay and receive health care kickbacks, conspiracy to commit money laundering and money laundering. If convicted, they each face a maximum penalty of 20 years in prison for each count of conspiracy to commit money laundering and money laundering, 10 years in prison for conspiracy to commit health care fraud and five years in prison for conspiracy to defraud the United States and to pay and receive health care kickbacks.
Hashmi is charged with conspiracy to commit health care fraud, health care fraud, conspiracy to defraud the United States and to pay and receive health care kickbacks and paying health care kickbacks. If convicted, he faces a maximum penalty of 10 years in prison for each count of conspiracy to commit health care fraud, health care fraud and paying health care kickbacks and five years in prison for conspiracy to defraud the United States and to pay and receive health care kickbacks.
Memon is charged with conspiracy to commit health care fraud, conspiracy to defraud the United States and to pay and receive health care kickbacks and paying health care kickbacks. If convicted, she faces a maximum penalty of 10 years in prison for each count of conspiracy to commit health care fraud and paying health care kickbacks and five years in prison for conspiracy to defraud the United States and to pay and receive health care kickbacks.
Wasef is charged with conspiracy to commit health care fraud and conspiracy to defraud the United States and to pay and receive health care kickbacks. If convicted, she faces a maximum penalty of 10 years in prison for conspiracy to commit health care fraud and five years in prison for conspiracy to defraud the United States and to pay and receive health care kickbacks.
The charges in the indictment are allegations and the defendants are presumed innocent unless and until proven guilty.
Trial Attorney Patrick J. Campbell of the Criminal Division’s Fraud Section is prosecuting the case with Assistant United States Attorney Tanisha R. Payne of the Eastern District of New York’s Asset Recovery Section, who is handling forfeiture matters and Paralegal Specialist Jonah Levine.
The Defendants:
KHAN, ZAKIA
Age: 53
Brooklyn, New YorkABASSI, ANSIR (also known as “Zaib Abassi” and “Ansir Zaib”)
Age: 38
Brooklyn, New YorkANTAO, ELAINE (also known as “Aleena”)
Age: 45
Brooklyn, New YorkHAMDI, OMNEAH
Age: 61
Brooklyn, New York
HASHMI, AMRAN
Age: 53
Brooklyn, New YorkIJAZ, AHSAM
Age: 27
Brooklyn, New YorkMEMON, SEEMA
Age: 30
Brooklyn, New YorkWASEF, MANAL
Age: 44
Brooklyn, New York
E.D.N.Y. Docket No.: 24-CR-409 (AMD)
Eight Charged in $68M Social Adult Day Care and Home Health Care SchemeRead the Press Release
An indictment was unsealed today in Brooklyn, New York, charging eight defendants for their alleged roles in a scheme to defraud Medicaid of approximately $68 million through the operation of two social adult day cares and a home health care financial intermediary that were paying kickbacks and bribes for services that were not provided.
According to court documents, Zakia Khan, 53, of Brooklyn, and Ahsan Ijaz, 27, of Brooklyn, owned two social adult day cares, Happy Family Social Adult Day Care Center Inc. (Happy Family) and Family Social Adult Day Care Center Inc. (Family Social), and a financial intermediary, Responsible Care Staffing Inc. (Responsible Care), for the New York Medicaid Consumer Directed Personal Assistance Services Program (CDPAP), which permits family members of Medicaid recipients to receive payment for assisting Medicaid recipients with activities of daily living. Beginning in approximately October 2017, in exchange for kickbacks and bribes, marketers Elaine Antao, 45, also known as Aleena, of Brooklyn, Omneah Hamdi, 61, of Brooklyn, and Manal Wasef, 44, of Brooklyn, allegedly referred Medicaid recipients to Happy Family, Family Social, and/or Responsible Care. The marketers in turn allegedly paid kickbacks and bribes to Medicaid recipients for social adult day care and CDPAP services that Happy Family, Family Social, and Responsible Care billed to Medicaid but were not provided or were induced by kickbacks and bribes. Ansir Abassi, 38, also known as Zaib Abassi and Ansir Zaib, of Brooklyn, and Amran Hashmi, 53, of Brooklyn, allegedly managed Happy Family and Family Social and the marketers. To carry out the kickback scheme, Khan, Antao, Ijaz, Abassi, and Hamdi allegedly used business entities to launder the fraud proceeds and generate the cash used to pay kickbacks and bribes. Seema Memon, 30, of Brooklyn, an employee of Happy Family who was previously charged by complaint on July 1, was also indicted.
“As alleged in the indictment, these defendants orchestrated a years-long scheme to defraud Medicaid of tens of millions of dollars for social adult day care and home care services for seniors that they did not provide,” said Principal Deputy Assistant Attorney General Nicole M. Argentieri, head of the Justice Department’s Criminal Division. “The defendants allegedly paid cash bribes and kickbacks to recruiters and Medicaid recipients as part of a scheme to enrich themselves at the expense of vital programs for senior citizens. Today’s charges make clear that the Criminal Division will not tolerate schemes that brazenly steal from federal health care programs.”
“Social adult day care and home health services are meant to help seniors, but as alleged, the defendants allegedly turned their businesses into a brazen cash grab of millions of dollars from the Medicaid program,” said U.S. Attorney Breon Peace for the Eastern District of New York. “My office is committed to investigating and prosecuting those who plunder taxpayer-funded, federal health care programs dollars while purporting to offer health care services.”
“HHS-OIG is committed to working with our law enforcement partners to investigate allegations that bribes and kickbacks are paid with Medicaid monies,” said Special Agent in Charge Naomi Gruchacz of the Department of Health and Human Services Office of Inspector General (HHS-OIG). “Individuals and entities that participate in the federal health care system are required to obey the laws meant to preserve the integrity of program funds and the provision of appropriate, quality services to patients.”
“The crimes outlined in this indictment took advantage of a network that offers essential health care and other services to those in need,” said Interim Commissioner Thomas G. Donlon of the New York City Police Department (NYPD). “Let it be clear: anyone who attempts to profit by defrauding the system will face consequences, as these schemes drain already limited resources and deprive beneficiaries of crucial funds. I commend our NYPD investigators and federal law enforcement partners for their successful and continued collaboration.”
“As alleged, the defendants saw nothing beyond the dollar signs associated with their crimes, and in turn defrauded the U.S. government of $68 million in welfare funds meant for one of our country’s most vulnerable populations,” said Special Agent in Charge William S. Walker of Homeland Security Investigations (HSI) New York. “Today’s announcement underscores the HSI New York El Dorado Task Force’s unrelenting focus on dismantling and disrupting financial fraud schemes that exploit the American public and hurt our economy.”
Khan is charged with conspiracy to commit health care fraud, three counts of health care fraud, conspiracy to defraud the United States and to pay and receive health care kickbacks, paying health care kickbacks, conspiracy to commit money laundering, and money laundering. If convicted, she faces a maximum penalty of 20 years in prison for each count of conspiracy to commit money laundering and money laundering, 10 years in prison for each count of conspiracy to commit health care fraud, health care fraud, and paying health care kickbacks, and five years in prison for conspiracy to defraud the United States and to pay and receive health care kickbacks.
Abassi, Antao, Hamdi, and Ijaz are charged with conspiracy to commit health care fraud, conspiracy to defraud the United States and to pay and receive health care kickbacks, conspiracy to commit money laundering, and money laundering. If convicted, they face a maximum penalty of 20 years in prison for each count of conspiracy to commit money laundering and money laundering, 10 years in prison for conspiracy to commit health care fraud, and five years in prison for conspiracy to defraud the United States and to pay and receive health care kickbacks.
Hashmi is charged with conspiracy to commit health care fraud, three counts of health care fraud, conspiracy to defraud the United States and to pay and receive health care kickbacks, and paying health care kickbacks. If convicted, he faces a maximum penalty of 10 years in prison for each count of conspiracy to commit health care fraud, health care fraud, and paying health care kickbacks, and five years in prison for conspiracy to defraud the United States and to pay and receive health care kickbacks.
Memon is charged with conspiracy to commit health care fraud, conspiracy to defraud the United States and to pay and receive health care kickbacks, and paying health care kickbacks. If convicted, she faces a maximum penalty of 10 years in prison for each count of conspiracy to commit health care fraud and paying health care kickbacks and five years in prison for conspiracy to defraud the United States and to pay and receive health care kickbacks.
Wasef is charged with conspiracy to commit health care fraud and conspiracy to defraud the United States and to pay and receive health care kickbacks. If convicted, she faces a maximum penalty of 10 years in prison for conspiracy to commit health care fraud and five years in prison for conspiracy to defraud the United States and to pay and receive health care kickbacks.
HHS-OIG, NYPD, and HSI are investigating the case.
Trial Attorney Patrick J. Campbell of the Criminal Division’s Fraud Section is prosecuting the case. Assistant U.S. Attorney Tanisha R. Payne for the Eastern District of New York is assisting with forfeiture matters.
The Fraud Section leads the Criminal Division’s efforts to combat health care fraud through the Health Care Fraud Strike Force Program. Since March 2007, this program, currently comprised of nine strike forces operating in 27 federal districts, has charged more than 5,400 defendants who collectively have billed federal health care programs and private insurers more than $27 billion. In addition, the Centers for Medicare & Medicaid Services, working in conjunction with HHS-OIG, are taking steps to hold providers accountable for their involvement in health care fraud schemes. More information can be found at www.justice.gov/criminal-fraud/health-care-fraud-unit.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
MS-13 Gang Members Charged in Superseding Indictment for Crimes of Deadly Violence in Nassau CountyRead the Press Release
Earlier today, a 17-count superseding indictment was unsealed in federal court in Central Islip charging seven members of the violent transnational criminal organization La Mara Salvatrucha, also known as the MS-13, with multiple racketeering offenses including two murders, one attempted murder, murder conspiracies, a narcotics trafficking conspiracy and related firearms offenses (the “Superseding Indictment”). Two of those defendants, William Lainez-Duran, also known as “Chino” and “Spanky,” and Elvin Eulises Vasquez-Lopez, also known as “Pikachu,” were arrested this morning in Hempstead, New York and will be arraigned this afternoon before United States Magistrate Judge Steven L. Tiscione. Another defendant, Jose Omar Yanes-Romero, also known as “Jose Pineda,” “Chino” and “Iron,” was arrested this morning in Culpeper, Virginia, and will be arraigned at the Charlottesville federal courthouse in the Western District of Virginia. Two of the remaining three defendants are in custody on criminal charges, and the third is in immigration custody and will be arraigned at a later date.
Defendants Henry Aquino-Hernandez, also known as “Zancudo,” an associate of the Herndon City clique, Yanes-Romero, a member of the Coronados clique and Lainez-Duran, a member of the Hempstead clique, have been charged with participating in the July 19, 2022 murder of Walter Ochoa. Defendant Gerson Hernandez, also known as “Steven Jefferson,” “Jeffrey,” “Serio,” “Serioso” and “Necio,” a member of the Hempstead clique, was previously charged with participating in the murder. Henry Canales, also known as “Thunder” and “Cruzito,” a member of the Coronados clique who is currently in New York State custody, has been charged with a related murder conspiracy, as well as with being an accessory after the fact. Additionally, Jairo Cornejo-Crespin, also known as “Flaco,” a member of the Hempstead clique, has been charged with a December 15, 2023 attempted murder, which occurred adjacent to Hempstead High School. Separately, Canales and Vasquez-Lopez, a member of the Coronados clique, are charged with a May and June 2022 conspiracy to murder rival gang members.
Breon Peace, United States Attorney for the Eastern District of New York, James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI), William S. Walker, Special Agent in Charge, U.S. Department of Homeland Security, Homeland Security Investigations, New York (HSI), Anne T. Donnelly, Nassau County District Attorney and Patrick J. Ryder, Commissioner, Nassau County Police Department (NCPD), announced the charges.
“The racketeering offenses alleged in the superseding indictment, including murder, murder conspiracies, drug trafficking, and a brazen shooting outside Hempstead High School at dismissal time demonstrate the MS-13 gang members’ brutality and utter disregard for human life,” stated United States Attorney Peace. “The relentless efforts of the prosecutors in my Office and our local and federal law enforcement partners to bring these offenders to justice will help reduce violence on Long Island and make our communities safer.”
Mr. Peace expressed his appreciation to the FBI’s Long Island Gang Task Force, the United States Attorney’s Office for the Western District of Virginia, the Richmond Division of the FBI, the Culpeper County Sheriff's Office and the Culpeper Police Department.
“These six MS-13 members allegedly conducted a series of retaliatory murders, shootings, and drug trafficking in furtherance of the gang’s nefarious tactics and criminal operations on Long Island,” stated FBI Assistant Director in Charge Dennehy. “This alleged violence recklessly jeopardized public safety as it encroached on neighborhoods, school properties, and recreational spaces, placing innocent bystanders in the crosshairs. With the assistance of our law enforcement and prosecutorial partners, the FBI will continue to dismantle all MS-13 cliques plaguing our communities.”“Today’s charges underscore our unwavering focus on public safety and the continued collaboration with our law enforcement partners to address the threat posed by MS-13 to Long Island communities. HSI New York will not stand idly by as the MS-13 gang attempts to strengthen its presence in Nassau County,” stated HSI New York Special Agent in Charge Walker. “With each new indictment, we continue to whittle away at MS-13 on Long Island and at its false notion of impunity from the law.”
“For years, the Nassau County District Attorney’s Office has worked with our federal and local law enforcement partners to cripple MS-13 and other criminal organizations and has successfully diminished their impact in our communities,” stated Nassau County District Attorney Donnelly. “The defendants targeted in this wide-ranging indictment have been involved in multiple violent crimes in Hempstead and ruthless gang violence that has cost so many individuals their lives. We will continue to collaborate with our federal and local partners to take down dangerous gang members and protect our residents.”
As set forth in the superseding indictment and a detention memorandum filed earlier today, six defendants are charged with participating in the July 19, 2022 murder of Ochoa in Uniondale Park in Uniondale, New York. Ochoa was targeted by the MS-13 because he was suspected of being a member of a rival street gang. Hernandez, Aquino-Hernandez, Canales, Lainez-Duran, Vasquez-Lopez, Yanes-Romero and other MS-13 members also allegedly plotted the murder in retaliation for the killing of an MS-13 member 11 days earlier, which the MS-13 blamed on the 18th Street gang. On the evening of July 19, Ochoa was with another individual in Uniondale Park when they were approached by Hernandez, Yanes-Romero and a third MS-13 member who were armed with a .45 caliber handgun and at least one knife. The three gang members shot Ochoa to death and stabbed him in the neck, and then fled the park.
The superseding indictment also charges Cornejo-Crespin, who was previously charged in Nassau County and is currently incarcerated, with an attempted murder in Hempstead. Specifically, on December 15, 2023, near Hempstead High School, Cornejo-Crespin used a 9-millimeter semiautomatic pistol bearing no make, model or serial number (also known as a “ghost gun”) to shoot an 18-year-old male that he believed to be a rival gang member. The victim was shot five times but survived. The shooting took place at approximately 3:22 p.m., shortly after school dismissal, when numerous students were walking around the neighboring area.
Finally, the superseding indictment charges six of the defendants with conspiring to distribute cocaine and marijuana. These charges stem from the MS-13 cliques’ street-level sales of cocaine and marijuana on Long Island, the proceeds of which were used to help finance the MS-13’s criminal operations including purchasing firearms, ammunition and other weapons and sending money to MS-13 leadership in Central America.
The superseding indictment is the latest in a series of federal prosecutions by the United States Attorney’s Office for the Eastern District of New York targeting members of the MS-13, a violent transnational criminal organization. The MS-13’s leadership traditionally has been based in El Salvador, Honduras, Guatemala and Mexico, but the organization also has thousands of members and an increasing number of leaders in the United States. With numerous branches, or “cliques,” the MS-13 is the most violent criminal organization on Long Island. Since 2003, hundreds of MS-13 members, including dozens of clique leaders, have been convicted on federal felony charges in the Eastern District of New York. A majority of those MS-13 members have been convicted on federal racketeering charges for participating in murders, attempted murders and assaults. Since 2010 alone, this Office has obtained indictments charging MS-13 members with carrying out more than 70 murders in the Eastern District of New York, and it has convicted dozens of MS-13 leaders and members in connection with those murders. These prosecutions are the product of investigations led by the FBI’s Long Island Gang Task Force, comprising agents and officers of the FBI, the NCPD, the Suffolk County Police Department, the Nassau County Sheriff’s Department, the Suffolk County Sheriff’s Office, the Suffolk County Probation Office, the New York State Police, the Hempstead Police Department, the Rockville Centre Police Department and the New York State Department of Corrections and Community Supervision.
If convicted, Hernandez, Aquino-Hernandez, Lainez-Duran and Yanes-Romero face up to life in prison, or the death penalty; Cornejo-Crespin faces up to life in prison; Canales faces up to 55 years in prison; and Vasquez-Lopez face up to 50 years in prison. The charges in the superseding indictment are allegations, and the defendants are presumed innocent unless and until proven guilty.
The government’s case is being handled by the Criminal Section of the Office’s Long Island Division. Assistant United States Attorneys Megan E. Farrell, Justina L. Geraci and Paul G. Scotti are in charge of the prosecution.
New Defendants:
HENRY AQUINO-HERNANDEZ (also known as “Zancudo”)
Age: 20
Bowling Green, Virginia (formerly of Uniondale, New York)HENRY CANALES (also known as “Thunder” and “Cruzito”)
Age: 24
Auburn, New York (formerly of Hempstead, New York)JAIRO CORNEJO-CRESPIN (also known as “Flaco”)
Age: 24
Brooklyn, New York (formerly of Freeport, New York)WILLIAM LAINEZ-DURAN (also known as “Chino” and “Spanky”)
Age: 24
Uniondale, New YorkElvin Eulises Vasquez-Lopez (also known as “Elvin Amaya” and “Pikachu”)
Age: 23
Hempstead, New YorkJose Omar Yanes-Romero (also known as “Jose Pineda,” “Iron,” “Speedy” and “Chino”)
Age: 24
Culpeper, Virginia (formerly of Hempstead, New York)Defendant Previously Indicted:
GERSON HERNANDEZ (also known as “Steven Jefferson,” “Jeffrey,” “Serio,” “Serioso” and “Necio”)
Age: 23
East Meadow, New York (formerly of Hempstead, New York)E.D.N.Y. Docket No. 23-CR-369 (S-1)(JMA)