Northern District of New York
Press releases recorded for this federal judicial district.
Utica Area Man Sentenced in Fraud and Money Laundering CaseRead the Press Release
United States Attorney Richard S. Hartunian announced today that a Utica man has been sentenced for his role in an insurance fraud scheme and money laundering charge.
On May 28, 2013, JOSEPH DEMME, age 67, Whitesboro, NY, was sentenced by United States District Court Judge Norman A. Mordue in Syracuse. DEMME was sentenced to 15 months imprisonment and ordered to pay restitution in an amount exceeding $1.4 million. DEMME will also serve three years of supervision following his release from incarceration.
DEMME pled guilty on May 29, 2012 to conspiracy to commit mail fraud and money laundering. DEMME admitted that in or about 2005 he agreed to assist other conspirators in an insurance fraud scheme. The scheme involved a staged motor vehicle accident on Harbor Lock Road in Utica on March 20, 2006. On that date, Joseph Dellerba and Cynthia Morgan claimed to have been injured while passengers in a Ford van which was struck by a Ryder truck driven by Michael Matrulli. In fact, the collision was staged, and Dellerba and Morgan were not passengers at the time of the impact. Dellerba and Morgan claimed to have been injured as a result of the accident and submitted false insurance claims, including claims for personal injuries, no fault benefits and disability benefits. Dellerba and Morgan sought medical treatment for non-existent injuries or injuries that they claimed were the result of the collision.
The money laundering conviction stems from an October 10, 2007 incident where DEMME applied for and obtained a $25,000 loan from Rome Savings Bank in New Hartford, New York. The proceeds of the loan were derived from unlawful activity, in that in support of this loan application, DEMME submitted to the bank a false U.S. Individual Income Tax Return form 1040 for the year 2006, which overstated his income and had not been filed with the Internal Revenue Service.
The case was investigated by the Federal Bureau of Investigation, the Internal Revenue Service, Criminal Investigation Division and the New York State Insurance Frauds Bureau. The case was prosecuted by Assistant United States Attorney Edward R. Broton.
Bricktown Gang Member Sentenced to 140 Months ImprisonmentRead the Press Release
Shawntell Rush Was A Long Time Gang Member Who Often Possessed Handguns In Connection With His Gang Activity
SYRACUSE, NEW YORK –
RICHARD S. HARTUNIAN, United States Attorney, Northern District of New York, announces that SHAWNTELL RUSH, age 29, of Syracuse, was sentenced today in U.S. District Court in Syracuse to 140 months imprisonment for his role in conspiring to engage in a pattern of racketeering activity through his membership in the Bricktown Gang, a violent street gang operating on the streets of Syracuse.
As part of his plea, RUSH admitted that the Bricktown Gang operated within the City of Syracuse from at least 2000 through the present and that members of the Bricktown Gang: (1) maintain a specific geographic territory within the City of Syracuse in which only gang members can sell crack cocaine, cocaine and marijuana; (2) protect that exclusive crack distribution territory with violence if necessary; (3) obtain drugs from suppliers in New York City and elsewhere; (4) project a very violent attitude and respond to violence with violence in order to preserve their stature in the gang community; (5) on occasion use hand signs, wear blue colored bandanas and have tattoos, all of which are intended to signify their gang membership; (6) use criteria such as willingness to use violence, ability to sell drugs, and familial connections to determine membership; and (7) routinely carry and use firearms in connection with their gang activity.
RUSH also admitted to a robbery and multiple acts of gun possession as part of his gang activity.
This prosecution resulted from a long-term investigation conducted by the Syracuse Gang Violence Task Force, which is comprised of agents and detectives from the following agencies: the Syracuse Police Department, the Onondaga County Sheriff's Department, the New York State Troopers, the United States Marshals Service and the United States Department of Justice, Bureau of Alcohol, Tobacco, and Firearms (Syracuse Office). The Onondaga County District Attorney’s Office also assisted in the investigation.
Further questions or inquiries may be directed to Assistant U.S. Attorney, John M. Katko, who is handling the case, at (315) 448-0672.
Auburn, New York - Man pled guilty to filing a false personal income tax return in tax year 2007.Read the Press Release
United States Attorney Richard S. Hartunian announced today that Bradley S. Leader, 42, of Auburn, New York, pled guilty to filing a false personal income tax return in tax year 2007.
Leader is a chiropractor who has worked at Leader Chiropractic, a chiropractic center located in Auburn, New York. From 2005-2009, he realized income in the approximate amount of $225,000 over and above the income he reported on his personal tax returns. This was accomplished by Leader not providing all pertinent information to his tax preparer; specifically he did not disclose to his tax preparer or identify on his tax returns additional gross receipts information (personal checks received from patients and certain insurance company checks). In his plea agreement, Leader admitted he failed to include $55,513.87 as income on his 2005 personal federal tax return, $38,412.83 as income on his 2006 personal federal tax return, $47.435.90 as income on his 2007 personal federal tax return, $43,130.86 as income on his 2008 personal federal tax return, and $42,036.00 as income on his 2009 personal federal tax return. Leader knew the returns he filed each year were false because each substantially under reported his income for that year. As a result, Leader owes more than $68,000 in back taxes for the years 2005-2009.
United States District Judge David N. Hurd scheduled sentencing for September 27, 2013 at 2:00 p.m. in Utica. Leader faces a maximum term of imprisonment of three years and a fine of $100,000. In addition, the defendant will be required to pay all back taxes due and owing for the tax years 2005-2009.
The case was investigated by the Internal Revenue Service, Criminal Investigations. The case was prosecuted by Assistant U.S. Attorney Stephen C. Green.
Saratoga Springs Man Charged with Failing to Update Sex Offender Registration InformationRead the Press Release
Albany, New York —United States Attorney Richard S. Hartunian and David McNulty, U.S. Marshal for the Northern District of New York, announce the filing of a criminal Complaint charging EUGENE PERIARD, age 33, of Saratoga Springs, New York, with failing to update his sex offender registration information.1 The Complaint charges that on or about April 30, 2013, PERIARD failed to update his sex offender registration information by advising authorities that he had moved from Elk City, Oklahoma to Saratoga Springs, New York. If found guilty of the charge in the Complaint, the defendant faces a statutory maximum sentence of ten years imprisonment and a maximum fine of $250,000.00.
PERIARD had his initial appearance in Albany on May 23, 2013 before the Honorable Christian F. Hummel, United States Magistrate Judge. PERIARD was detained pending his next court appearance.
This case was investigated by the U.S. Marshals Service and the Saratoga Springs Police Department. This case is being prosecuted by Assistant United States Attorney Rick Belliss.
LOCAL CONTACT:
Rick Belliss
Assistant U.S. Attorney
Tel: (518) 431-0247_______________________
1The charge is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
Rochester Man Charged with Attempted Online Enticement of A Minor, Attempted Production of Child Pornography, and Transportation of Child PornographyRead the Press Release
Defendant Alleged to Have Communicated Online with an Undercover Investigator Posing as a
Twelve Year Old Girl in Order to Send Her Images of Child Pornography and to Arrange a
Meeting in a Syracuse Hotel Where Sexual Acts Would be FilmedAlbany, New York —United States Attorney Richard S. Hartunian and Joseph D’Amico, Superintendent of New York State Police, announce the filing of a three-count criminal Complaint charging JASON FRANK, age 27, of Rochester, New York, with the attempted online enticement of a minor, the attempted production of child pornography, and the transportation of child pornography. 1 According to the Complaint, between about February 2013 and April 2013, FRANK engaged in online chats with an undercover New York State Police investigator posing as a twelve year old girl. FRANK’s online chats urged the twelve year old girl to meet him for an encounter in which FRANK would perform oral sex on the girl and then have sexual intercourse with the girl. On or about April 9, 2013, FRANK attempted to produce images of child pornography when he showed up at a Syracuse hotel in possession of a digital camera, expecting to meet the twelve year old girl for purposes of a sexual encounter that would be filmed. Finally, between about February 2013 and April 2013 FRANK transported files of child pornography to the undercover investigator by sending the undercover investigator multiple still image files of child pornography via the Internet.
If found guilty of attempted online enticement of a minor, the defendant faces a statutory minium of at least ten years imprisonment and up to a maximum sentence of life imprisonment, and a maximum fine of $250,000.00. If found guilty of attempted production of child pornography, the defendant faces a statutory minium of at least fifteen years imprisonment and up to a maximum sentence of thirty years imprisonment, and a maximum fine of $250,000.00. If found guilty of transporting child pornography, the defendant faces a statutory minimum of at least five years imprisonment and up to a maximum sentence of twenty years imprisonment, and a maximum fine of $250,000.00.
FRANK had his initial appearance in Albany on May 23, 2013 before the Honorable Christian F. Hummel, United States Magistrate Judge. FRANK was detained pending his next court apperance.
This case was investigated by the New York State Police .This case is being prosecuted by Assistant United States Attorney Rick Belliss.
LOCAL CONTACT:
Rick Belliss
Assistant U.S. Attorney
Tel: (518) 431-0247_____________________________
1The charges are merely accusations and the defendant is presumed innocent until and unless proven guilty.
Unregistered Sex Offender Arrested in Cayuga CountyRead the Press Release
United States Attorney Richard S. Hartunian announced that JIMMY L. MORSE, 34, was arrested today at a residence in Locke, New York, and charged with the federal offense of failing to register as a sex offender.1
A criminal complaint unsealed today alleges that in June of 2002 MORSE was convicted in East Baton Rouge, Louisiana of Aggravated Oral Sexual Battery against a child, and sentenced to 4 years imprisonment. MORSE was also notified that he was required to register as a sex offender until April of 2020. MORSE last complied with his registration requirements in Louisiana in 2008, and a warrant was issued for him there in 2010 as a result.
In April of 2013 the United States Marshals Service received information from authorities in Louisiana that MORSE may be living in Cayuga County, New York. After investigation, the Marshals Service determined that MORSE’s conviction would require him to register as a sex offender in New York, and that he had not registered as required.
MORSE was located today at a residence in Locke, New York and arrested on a warrant signed yesterday by Hon. Therese Wiley Dancks, United States Magistrate Judge. He made his initial appearance before her today, and has been remanded pending disposition of his case.
The charge filed against MORSE carries with it a maximum sentence of 10 years, a fine of up to $250,000, and a term of supervised release of at least 5 years and up to life.
MORSE’S arrest is the result of an investigation by the United States Marshals Service Sex Offender Investigation Branch, North East Region, and the New York/New Jersey Regional Fugitive Task Force with the assistance of the Cayuga County Sheriff’s Office, and is being prosecuted by Assistant U.S. Attorney Lisa Fletcher as part of Project Safe Childhood. Led by the 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 identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.autotrader.com/.
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1The charges are merely accusations and the defendant is presumed innocent until and unless proven guilty.
Syracuse Woman Sentenced in Aggravated Identity Theft CaseRead the Press Release
United States Attorney Richard S. Hartunian announced today that a Syracuse woman has been sentenced for her role in a series of aggravated identity thefts, three of which were committed after she had been indicted and while she was under federal court supervision.
Today Maurisha Dixon, age 25, was sentenced by United States District Court Judge David N. Hurd in Utica. DIXON was sentenced to 60 months imprisonment and ordered to pay restitution in an amount exceeding $55,000 with $36,694 going to Sallie Mae, $5,000 to The College Loan Corporation, and the remainder to KeyBank. DIXON will also serve four years of supervision following her release from incarceration and was ordered to pay a special assessment of $1,100. She was remanded to prison immediately following sentencing.
DIXON pleaded guilty on August 24, 2012 to four counts of aggravated identity theft, one count of wire fraud, three counts of false representation of a social security number, and three counts of committing an offense while on supervised release (11 felony counts in total). DIXON admitted that she stole and misused without authorization the identities and personal information of four individuals - some known to her, and some unknown - and used that information to defraud financial institutions in a series of schemes involving student loans and credit cards. In executing those schemes, DIXON created and used false documents, counterfeited government agency letterhead, and falsely represented herself as the individuals whose identities she had stolen.
The case was investigated by the Social Security Administration - Office of Inspector General and the Office of the Inspector General for the U.S. Department of Education. The case was prosecuted by Assistant United States Attorney Stephen C. Green.
Federal Jury Convicts Two Syracuse Men for Conspiracy to Import and Distribute Synthetic Drug “molly”Read the Press Release
Syracuse, NY—United States Attorney Richard S. Hartunian today announced that a federal jury has convicted ROSARIO GAMBUZZA (age 48) of East Syracuse, NY and ERNEST SNELL (age 43) of Syracuse, NY, of conspiring to import and distribute a controlled substance analogue, known on the street as “Molly,” in Syracuse, New York between January 2010 and April 2011. GAMBUZZA was also convicted on 19 counts of money laundering in connection with $73,000 dollars he wired to a co-conspirator in Shanghai, China to purchase “Molly,” a designer drug similar to the Schedule I controlled substance, MDMA. Each defendant faces a maximum term of imprisonment of twenty (20) years, up to a $1 million fine, and at least three (3) years of supervised release following any period of incarceration. Sentencing has been scheduled for October 11, 2013 before U.S. District Judge Glenn T. Suddaby.
These prosecutions resulted from an investigation first undertaken in the spring of 2009. Agencies included the Syracuse Resident Office of the Drug Enforcement Administration (DEA), the Internal Revenue Service (IRS)- Criminal Investigation Division (Syracuse Resident Office), the Onondaga County Sheriff’s Office, the Syracuse Police Department, the Department of Homeland Security- HSI, the Onondaga County District Attorney’s Office, the United States Marshals Service, the New York State Police, and the United States Attorney’s Office for the Northern District of New York. The investigation, which included wiretaps on two of the defendants’ telephones, revealed that this drug trafficking organization was responsible for the distribution of over one hundred (100) kilograms of “Molly” during the course of the conspiracy. The “Molly,” manufactured in factories in China, was shipped to distributors in the Syracuse area, as well as other areas in the United States, where it was then distributed to others by members of the conspiracy. The large scale drug trafficking conspiracy, based in Central New York, involved co-conspirators located in Florida, California, Texas, Virginia and elsewhere. Twenty of the twenty-two indicted co-conspirators have been convicted.
United States Attorney Richard S. Hartunian stated “This successful prosecution was brought about through the excellent cooperation of local, state, federal law enforcement agencies working together to combat the influx of ‘designer drugs’ produced by illicit drug manufacturers overseas. I commend theses agencies for their tireless pursuit of those responsible for importing and distributing these drugs on our streets.”
DEA Special Agent in Charge Brian R. Crowell stated, "This investigation of local distributors of the manmade synthetic drug called 'molly,' led our investigators to China on an international conspiracy and 22 federal indictments. DEA and our local, state, federal and international law enforcement partners identified those responsible for peddling this lab-created poison for profit in our communities from the street corner dealer to the source of supply based in China. This investigation and trial unraveled a complex network of 'molly' traffickers. There remains one fugitive attorney Kenneth Feria of Hollywood, California and one fugitive hiding in China named Lei Zhang."1
IRS-Criminal Investigation Special Agent in Charge Toni Weirauch said, “These convictions are significant as they send a strong message to those who are contemplating entering this emerging area of the illegal drug industry and bringing these toxic substances to our communities. Moreover, this investigation and trial highlight to the public – especially to our youth – how dangerous bath salts are. IRS-Criminal Investigation remains committed to working with our law enforcement partners in the fight against all kinds of illegal drugs.”
The case was prosecuted by Assistant U.S. Attorneys Carla Freedman and John G. Duncan. Further questions or inquiries may be directed to Assistant United States Attorney Carla Freedman at (315) 448-0672.
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1As to these defendants, the indictment contains only allegations and the defendants are presumed innocent until and unless proven guilty in a court of law.
Spencerport, New York - Indictment announced of two individuals and Crane-Hogan Structural Systems, Inc.Read the Press Release
Richard S. Hartunian, United States Attorney for the Northern District of New York, announced today the Indictment of Mark Pullyblank, 52, of Caledonia, NY, William Clements, 52, of Victor, New York, and Crane-Hogan Structural Systems, Inc., 3001 Brockport Road, Spencerport, New York, which employs Pullyblank and Clements.
Crane-Hogan is a company engaged in hydro-demolition in which high pressure water is used to remove concrete from buildings such as parking garages prior to resurfacing. The waste-water from the hydro-demolition process contains a slurry of industrial waste including remnants of concrete which has a very high pH. Mark Pullyblank and William Clements were project supervisors in charge of demolition projects at the Binghamton Governmental Center Parking Garage and Johnson City Wilson Hospital Parking Garage throughout 2008 and 2009.
The Clean Water Act was enacted into law in 1972. Since that time it has prohibited the discharge of pollutants into waters of the United States without approved waste-water treatment and a permit, or into a permitted publically owned treatment works (POTW), unless in compliance with an approved pretreatment program. The Susquehanna River is a navigable water of the United States that provides drinking water to numerous individuals. It drains into the Chesapeake Bay and into the Atlantic Ocean.
The three defendants are charged in a nine count felony Indictment with discharging untreated industrial waste-water from a hydro-demolition process without a permit in violation of the Clean Water Act. More specifically, Mark Pullyblank and Crane-Hogan are charged in counts one through six with discharging untreated industrial waste-water directly into the Susquehanna River from a hydro-demolition project conducted at the Binghamton Governmental Center Parking Garage. Crane-Hogan is charged in Count Seven with similar industrial waste-water discharges into the Susquehanna River from the Wilson Parking Garage, Johnson City, New York. William Clements, Mark Pullyblank, and Crane-Hogan are charged in counts 8 and 9 with discharging industrial waste-water into the Binghamton-Johnson City Joint Sewage Treatment Plant, without an approved industrial pretreatment permit, in violation of the Clean Water Act.
The allegations in the Indictment are mere accusations and all persons are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
This case is being investigated by Investigators with the New York State Department of Environmental Conservation, Bureau of Environmental Crimes Investigations and Special Agents of the Environmental Protection Agency. Assistance with this case has been provided by the New York State Office of General Services, the Binghamton City Engineer, and the Binghamton-Johnson City Publically Owned Treatment Works. The case is being prosecuted by Assistant United States Attorney Craig Benedict. Questions may be directed to AUSA Benedict at 315-448-0726.
Utica, New York - Two Utica area men have pled guilty to committing a string of bank robberies.Read the Press Release
United States Attorney Richard S. Hartunian announced today that two Utica area men have pled guilty to committing a string of bank robberies.
ZACHARIAH EDWARDS, 21, of Frankfort, and NICHOLAS FERRONE, 21, of Utica, admitted robbing:
Chase Bank, 6004 Court Street, Syracuse, New York of $2,156 on January 14, 2013; Berkshire Bank, 2080 Western Avenue, Guilderland, New York of $2,566 on January 23, 2013;
Chase Bank, 4425 East Genesee Street, Dewitt, New York of $4,680.75 on January 28, 2013; Trustco Bank, 2050 Western Avenue, Guilderland, New York of $1,930 on February 13, 2013;
Bank of America, 638 Memorial Drive, Chicopee, Massachusetts of $3,300 on February 25, 2013;
Key Bank, 1610 Eastern Parkway, Schenectady, New York of $3,700 on March 1, 2013; and M&T Bank, 5170 West Taft Road, Syracuse, New York of $3,446 on March 4, 2013.In addition, FERRONE admitted to a robbery of the Alliance Bank at 142 Genesee Street, Oneida, New York of $2,240 on January 3, 2013. Although no weapons were displayed the robbers told the tellers they were armed during the course of several of the robberies.
EDWARDS has been held without bail since his arrest on March 8, 2013. FERRONE has likewise been held without bail since his arrest on March 11, 2013. They will both continue to be detained until their sentencing which is scheduled for October 1, 2013 before Senior U.S. District Judge Frederick J. Scullin, Jr. Bank robbery carries a maximum penalty of twenty years imprisonment and a fine of $250,000 on each count.
The investigation has been a multi-agency effort, including participation by the Dewitt Police Department, the New York State Police, the Guilderland Police Department, the Oneida Police Department, the Onondaga County Sheriff’s Office, Chicopee, Massachusetts Police Department, Schenectady Police Department and the Federal Bureau of Investigation. The case is being prosecuted by AUSA Edward R. Broton.
Phoenix Man Arrested on Federal Child Pornography ChargesRead the Press Release
United States Attorney Richard S. Hartunian announced the arrest today of a Phoenix, New York man on federal child pornography charges.
A federal criminal complaint unsealed today charges RICHARD J. WATKINS, age 48, with knowingly distributing, receiving, and possessing child pornography via the Internet. The complaint alleges that in September of 2012 WATKINS made files depicting child pornography available to others on the internet by way of a file sharing program, and that an undercover police officer was able to obtain from WATKINS’ computer video files depicting children engaged in sexually explicit conduct. The complaint further alleges that following the execution of a search warrant at WATKINS’ Phoenix residence, the New York State Police found that WATKINS possessed hundreds of video files of child pornography on media seized from his residence.
WATKINS was arrested on the federal charges this morning, and made his initial appearance before Hon. Andrew T. Baxter, United States Magistrate Judge, who ordered him detained pending a hearing scheduled for Monday, May 6, 2013.
For his distribution and receipt of child pornography, WATKINS faces a mandatory minimum penalty of 5 years imprisonment, a maximum penalty of 20 years; For possessing child pornography his maximum potential sentence of imprisonment is 10 years. Each count carries with it a maximum fine of $250,000, a required term of supervised release of at least 5 years, and up to life, and his registration as a sex offender.
The charges are merely accusations and the defendant is presumed innocent until and unless proven guilty.
WATKINS’ arrest is the result of an investigation by the New York State Police, and the United States Secret Service. It is being prosecuted by Assistant U.S. Attorney Lisa Fletcher. WATKINS’ prosecution by the United States Attorney's Office is part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the 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 identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Former St. Joseph’s Hospital Employee Pleads Guilty to EmbezzlementRead the Press Release
SYRACUSE, NY –United States Attorney Richard S. Hartunian announced that BONNIE SIMSON, 41, of Manlius, NY entered a plea of guilty in U.S. District Court in Syracuse on April 30, 2013, to an indictment charging her with one count of embezzlement from a program receiving federal funds, in violation of Title 18, United States Code, Section 666(a)(1)(A).
Ms. Simson faces a maximum term of imprisonment of 10 years, a fine of $250,000 and a term of supervised release of three years. From December of 2000 until March, 2011, Simson was employed as the manager of the Patient Telephone and Television Services Program ("PTTSP") at St. Joseph's Hospital in Syracuse, New York. During that time, Simson stole currency from envelopes containing payments made by individual patients to the PTTSP and then inaccurately reported the amount of currency payments made by the patients in order to conceal her embezzlement. The government has charged that Ms. Simson embezzled in excess of $800,000, but Ms. Simson maintains that the amount of stolen funds is lower. The amount of stolen funds will be determined at sentencing.
This case resulted from an investigation conducted by the Electronic Crimes Task Force staffed by members of the United States Secret Service, Syracuse Resident Office, and Syracuse Police Department. The case is being prosecuted by Assistant U.S. Attorney Gwendolyn Carroll. Sentencing is currently set for September 13,2013 at 10:00 in Utica, New York.
All press inquiries may be made to Executive Assistant United States Attorney John G. Duncan, who may reached at (315) 448-0672.
Attorney General Holder Names U.s. Attorney Hartunian to Advisory CommitteeRead the Press Release
Albany, New York – United States Attorney General Eric Holder today announced the appointment of Northern District of New York United States Attorney Richard S. Hartunian to serve a two-year term on the Attorney General's Advisory Committee (AGAC). Hartunian was one of six U.S. Attorneys appointed to the AGAC, comprised of the U.S. Attorneys selected from 16 of the 93 federal judicial districts in the United States, plus the U.S. Attorney for the District of Columbia and representatives of the three litigating divisions led by U.S. Attorneys – criminal, civil, and appellate.
United States Attorney Hartunian said, “I am honored to have been appointed by Attorney General Holder to serve on his Advisory Committee, and look forward to working with him and the U.S. Attorneys representing other districts to protect, promote, and enhance the fair administration of justice across our nation.”
Hartunian has served as the United States Attorney for the Northern District of New York since the beginning of 2010. He had been an Assistant United States Attorney since 1997, serving as the Northern District’s Narcotics Chief and Organized Crime Drug Task Force Coordinator from 2006 until he became U.S. Attorney. He is a 1983 graduate of Georgetown University and 1986 graduate of Albany Law School of Union University. Prior to joining the U.S. Attorney’s Office, Hartunian served as an Assistant District Attorney for the Office of District Attorney in Albany County and worked in private practice.
The Attorney General’s Advisory Committee was established in 1973; it is responsible for considering and making recommendations to the Attorney General regarding establishing and modifying the policies and procedures of the U.S. Department of Justice, cooperating with State Attorneys General and other state and local officials, promoting greater consistency in the application of legal standards, and formulating programs to improve the quality of justice at all levels throughout the United States.
The Attorney General’s press release announcing the appointment of U.S. Attorney Hartunian and five other U.S. Attorneys is attached.
Binghamton Area Man Sentenced for $594,000 Theft and Tax EvasionRead the Press Release
United States Attorney, Richard S. Hartunian, announced that William P. Stiles, 43, of Deposit, Broome County, New York, was sentenced today in United States District Court to twenty four weekends of incarceration, and five years supervised release for the felony crimes of wire fraud and tax evasion.
Stiles was chief operating officer and part owner of Aeden Waterford, Inc. (AWI), a payroll and human services company located in the city of Binghamton. Stiles stole more than $500,000 from approximately 100 business clients of AWI between November, 2005, and November, 2010. The money stolen by Stiles was supposed to be used by Stiles to pay client employment withholding taxes, but instead was deposited by Stiles into Stiles’ personal bank accounts. Stiles used the funds stolen from AWI clients for his own personal benefit. Stiles further admitted he evaded income taxes due on the stolen money.
In addition to home confinement and supervised release, District Court Judge Thomas J. McAvoy ordered Stiles to pay $64,466.00 in back taxes to the Internal Revenue Service, and $529,607.29 in restitution to the victims of his crime.
The case was investigated by the Internal Revenue Service, Criminal Investigations, the Federal - Bureau of Investigation, Binghamton Resident Office, and was prosecuted by the U.S. Department of Justice, U.S. Attorney’s Office.
Bricktown Gang Member Sentenced to 89 Months in PrisonRead the Press Release
RICHARD S. HARTUNIAN, United States Attorney, Northern District of New York, announces that AMADIS HUNTER, age 25, of Syracuse, was sentenced today in U.S. District Court in Syracuse to 89 months imprisonment for his role in conspiring to engage in a pattern of racketeering activity through his membership in the Bricktown Gang, a violent street gang operating on the streets of Syracuse.
As part of his plea, HUNTER admitted that the Bricktown Gang operated within the City of Syracuse from at least 2000 through the present and that members of the Bricktown Gang: (1) maintain a specific geographic territory within the City of Syracuse in which only gang members can sell crack cocaine, cocaine and marijuana; (2) protect that exclusive crack distribution territory with violence if necessary; (3) obtain drugs from suppliers in New York City and elsewhere; (4) project a very violent attitude and respond to violence with violence in order to preserve their stature in the gang community; (5) on occasion use hand signs, wear blue colored bandanas and have tattoos, all of which are intended to signify their gang membership; (6) use criteria such as willingness to use violence, ability to sell drugs, and familial connections to determine membership; and (7) routinely carry and use firearms in connection with their gang activity.
This case involved multiple acts of violence and drug distribution carried out by various gang members on a regular basis, as alleged in the Indictment, including but nor limited to 2 instances of knife violence, 2 murders, 8 other shootings, 7 other acts of gun possession, 12 acts of crack distribution and/or possession with intent to distribute crack, and a major gang assault that occurred within a Denny’s restaurant on Erie Boulevard in Dewitt, New York.
With respect to the two murders, the Indictment includes allegations that gang members killed innocent victims on two separate occasions as gang members sought retaliation against rival gang members. One such allegation involves the November 2010 murder by Bricktown gang member SAQUAN EVANS of a 20 month old child named Rashad Walker, Jr., as Walker sat in a car seat with his mother by his side in the 300 block of Coolidge Avenue. The other murder allegation involves the September 2007 fatal shooting by Bricktown gang members JARRELL WILLIAMS and ERNEST HESTER of Anthony Ford in the 1600 block of East Fayette Street, Syracuse. A female who was with Ford at the time was shot in the head but survived. EVANS, WILLIAMS and HESTER have not pled guilty and are expected to go to trial on this federal RICO charge later this summer. The 11 other defendants 1 in this case have all pled guilty and many of them have already been sentenced to varying lengths of imprisonment.
This prosecution resulted from a long-term investigation conducted by the Syracuse Gang Violence Task Force, which is comprised of agents and detectives from the following agencies: United States Department of Justice, Bureau of Alcohol, Tobacco, and Firearms (Syracuse Office), the Syracuse Police Department, the Onondaga County Sheriff's Department, the New York State Troopers, and the United States Marshals Service. The Onondaga County District Attorney’s Office also assisted in the investigation.
Further questions or inquiries may be directed to Assistant U.S. Attorney, John M. Katko, who is handling the case, at (315) 448-0672.
Seven Postal Employees Plead Guilty to Making False Statements to Obtain Unemployment BenefitsRead the Press Release
Defendants jeopardize integrity of program meant to assist hard working Americans
Albany, New York--RICHARD S. HARTUNIAN, United States Attorney, Northern District of New York, announces that seven United States Postal Service employees have plead guilty to making false statements to obtain unemployment benefits to which they were not entitled. These guilty pleas are part of an ongoing national sweep targeting fraud by Postal workers in claiming unemployment benefits. In each case, the defendants lied about their eligibility for benefits by either falsely claiming to be unemployed or under-reporting their income, and fraudulently obtaining benefits ranging from $5,396 to $26,218.
All seven Postal employees entered guilty pleas to one count informations charging them with making false statements to obtain unemployment benefits they were not entitled to in violation of Title 18, United States Code, Section 1919. At the guilty plea and sentencing each defendant was ordered to pay restitution in full for the fraud they committed. The defendants and the fraud amount in each case are as follows:
Erin Gagnon, 37 of Plattsburgh, New York, $26,218;
Clarence Reed, 46 of Schenectady, New York, $11,255;
Nicole Martin, 41 of Brooklyn, New York, $5,396;
Donnel Richardson, 30 of Brooklyn, New York, $9,007;
Kelly Williams, 36 of Nyack, New York, $16,605;
Angela Blazejewski, 35 of Rocky Point, New York, $11,542; and
John Congiusti, 31 of Bronx, New York, $8,896.“We are always vigilant in enforcing the law, even when the case, sadly, involves public servants. The actions of these defendants undermine America’s trust in others serving the public and impede the system in benefitting those truly in need,” said United States Attorney Richard S. Hartunian. “Unemployment benefits are meant to provide crucial financial assistance to workers who become unemployed through no fault of their own. We will continue to work with our law enforcement partners to stop fraudulent schemes such as these which ultimately hurt the American taxpayers.”
“Today’s guilty pleas highlight the importance of this multi-agency investigation to identify fraud in benefit programs such as the U.S. Department of Labor’s Unemployment Insurance Program. We will continue to work with our law enforcement partners to investigate those who seek to obtain benefits to which they are not entitled,” stated Robert Panella, Special Agent-in-Charge of the New York Regional Office of the U.S. Department of Labor Office of Inspector General, Office of Labor Racketeering and Fraud Investigations.
"These pleas come as a result of the excellent investigative collaboration between the U.S. Postal Service Office of Inspector General, the New York State Department of Labor- Office of Special Investigations and the Department of Labor Office of Inspector in General", said Rafael A. Medina, Special Agent in Charge of the USPSOIG's Northeast Area Field Office. "The Postal Service prides itself in its dedicated and professional employees, but the small percentage who stray away from those professional standards should know that law enforcement, at all levels, will always work closely to combat fraud against any federal or state program."
“Unemployment Insurance fraud - especially when it’s committed by government employees who should be serving taxpayers, not stealing from them – is something we at the Department of Labor have a zero tolerance policy on,” said State Labor Commissioner Peter M. Rivera. “Our Major Case Unit at the Labor Department continues to uncover these acts of deception on a daily basis and I am proud of the work we have done together with the U. S. Attorney for the Northern District of New York to bring these individuals to justice.”
This prosecution resulted from a joint investigation conducted by the U.S. Postal Service Office of Inspector General, New York State Department of Labor, Office of Special Investigations, and US Department of Labor OIG, Office of Labor Racketeering and Fraud Investigations.
This case was prosecuted by Assistant U.S. Attorney, Geoffrey J. L. Brown.
Former Mcginn, Smith & Co., Inc. Senior Managing Director SentencedRead the Press Release
ALBANY, N.Y.—Matthew Rogers, of Miami, Florida, a citizen of the United Kingdom and a resident alien of the United States, who worked for McGinn, Smith & Co., Inc. as a senior managing director from 2007 until 2009, was sentenced today to one year of probation and ordered to pay a $10,000 fine by United States District Judge David N. Hurd, announced United States Attorney Richard S. Hartunian, Toni M. Weirauch, Special Agent-in-Charge, Internal Revenue Service, Criminal Investigation, New York Field Office, and Andrew W. Vale, Special-Agent-in-Charge, Federal Bureau of Investigation, Albany Division. The sentence follows Rogers’ November 29, 2011 guilty plea to filing a false income tax return related to his failure to declare $948,000 in fees that he had received between 2006 and 2009 in connection with private placement offerings sold by McGinn, Smith & Co., Inc.
In 2009, Rogers executed backdated promissory notes regarding some of the transactions to make it appear that they were loans. Rogers knew that these backdated promissory notes would be submitted to FINRA. In addition, on his 2009 return, Rogers falsely declared that $873,000 of the $948,000 was income in 2009 for “forgiveness of indebtedness” when he knew that this was false because the money was never a loan and was received over several tax years. Rogers admitted the following details in connection with his guilty plea:
The 2006 Fees
On September 29, 2006, Timothy M. McGinn, David L. Smith, and Matthew Rogers formed TDM Cable Funding LLC. That same day, TDM Cable Funding LLC purchased $2.6 million of cable contracts related to two Florida housing developments. The McGinn, Smith & Co., Inc. broker-dealer then raised over $3.5 million from investors seeking to invest in those cable contracts. In 2006, Rogers received $385,000 in fees from TDM Cable Funding LLC in connection with the September 2006 offering. His partners, Timothy M. McGinn and David L. Smith, received similar fees.
On January 10, 2007, Rogers submitted a personal financial statement to Mercantile Bank in Boca Raton, Florida requiring him to list all sources of income and all liabilities for 2006. Rogers concealed the $385,000 in fees that he had received in 2006 by failing to include it as income that he had received in 2006. Rogers also did not list the fees as “loans.”
In the fall of 2007, when Rogers gathered materials to prepare his 2006 federal income tax return, he called Timothy M. McGinn who told him that the $385,000 of fees were “loans,” and said “that’s the way it is.”
On October 15, 2007, Rogers signed the 2006 joint U.S. Individual Income Tax Return prepared for himself and his wife under the penalty of perjury knowing that the total income of $196,566 reported on line 22 of the return was false because it did not reflect the $385,000 in fees that he had received. The return was filed on October 18, 2007 at the Atlanta, Georgia service center.
The 2007 Fees and Return
During 2007, Rogers received $278,000 in fees in connection with three McGinn, Smith & Co., Inc. offerings which raised more than $10 million from investors.
On November 13, 2008, Rogers filed the joint 2007 U.S. Individual Income Tax Return prepared for himself and his wife under the penalty of perjury knowing that the total income reported was false because it did not reflect the $278,000 in fees that he had received in 2007.
The 2008 Fees and Return
During 2008, Rogers received $285,000 in fees in connection with a McGinn, Smith & Co., Inc. offering that raised more than $3 million from investors.
On January 20, 2009, Rogers submitted a personal financial statement to Mercantile Bank in Boca Raton, Florida requiring him to list all sources of income and all liabilities for 2008. Rogers concealed the $285,000 in fees that he had received in 2008 by failing to include it as income that he had received in 2008. Rogers also did not list the fees as “loans.”
On October 19, 2009, Rogers filed the joint 2008 U.S. Individual Income Tax Return prepared for himself and his wife under the penalty of perjury knowing that the total income reported was false because it did not reflect the $285,000 in fees that he had received.
The 2009 Fees
On June 10, 2009, Rogers received $25,000 in fees in connection with a McGinn, Smith & Co., Inc. offering which raised more than $1 million from investors.
The Execution of Backdated Promissory Notes
In November 2009, Timothy M. McGinn pressured Rogers to sign promissory notes in connection with several of the fee transactions involving TDM Cable Funding LLC. When Rogers learned about the promissory notes, he called McGinn. McGinn told Rogers that FINRA needed the notes and that Rogers had to sign them. Rogers, who did not want to be required to repay the fees that he had received, obtained a November 13, 2009 letter from McGinn, as managing member of TDM Cable Funding LLC, stating that the “debt” related to those fee transactions would be “forgiven” over four years. After receiving this fraudulent “forgiveness-of-debt” letter, Rogers executed the promissory notes. The only date on the promissory notes was the date of each transaction. Although Rogers knew that the promissory notes would be provided to FINRA, Rogers did not date his signature, and the promissory notes did not reveal that Rogers signed them in November 2009, more than two years after the transactions had actually occurred.
The 2009 Return Falsely Declaring $873,000 as “Forgiveness of Indebtedness”
On October 15, 2010, after Rogers became aware of the federal criminal investigation, Rogers filed his 2009 income tax return declaring $873,000 of the $948,000 of fees that he had received from 2006 through 2008 as income. Rogers falsely described the $873,000 as “forgiveness of indebtedness” despite knowing the fees had never been a loan and that he had an express agreement with McGinn that he would not have to repay the fees.
The total amount of loss is the tax loss resulting from Rogers's failure to declare the $948,000 that he received in fees.
The investigation was conducted by the Criminal Investigation Division of the Internal Revenue Service and the Federal Bureau of Investigation. The case is being prosecuted by Assistant United States Attorneys Elizabeth C. Coombe, Richard D. Belliss, and Wayne A. Myers of the United States Attorney’s Office for the Northern District of New York.
LOCAL CONTACT:
Elizabeth C. Coombe
Assistant U.S. Attorney
Tel: (518) 431-0247Cicero Man Pleads Guilty to Attempting to Entice A MinorRead the Press Release
Syracuse, New York —United States Attorney Richard S. Hartunian announced that BRYAN M. COLE, 30, of Cicero, New York pled guilty today in United States District Court to attempting to persuade a child he believed to be 11 years old to engage in unlawful sexual contact with him.
In his plea today, COLE admitted that in 2010 he contacted a female child on the Internet. After the child’s parents reported his sexually inappropriate chats to police, law enforcement took over the child’s account, and continued to correspond with COLE. Today COLE admitted that in those chats it was clear to him that the child was 11 years old, that he discussed engaging in sexually explicit conduct with the child, and that he arranged to meet with the child at a North Syracuse apartment on December 23, 2010, a day he believed was her 12th birthday, with the intent to engage in sexual conduct with her. When COLE arrived at the apartment as arranged, he was met by members of the New York State Police and arrested. He has remained in federal custody since his arrest.
COLE is scheduled to be sentenced for his offense on August 23, 2013 before Hon. David N. Hurd in Utica, New York. He faces a mandatory minimum sentence of 10 years, with a maximum sentence of life imprisonment. Any sentence of imprisonment must be followed by a term of supervised release of no less than 5 years, and up to life. He will also be required to register as a sex offender, and may be fined up to $250,000.
COLE’s arrest was a result of investigation by the City of Fulton Police Department and the New York State Police, with the assistance of the United States Secret Service, and is being prosecuted by Assistant United States Attorney Lisa Fletcher. This cooperative investigation and federal prosecution is a part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Launched in May 2006 by the Department of Justice, and led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), 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.
Arrests Made in Internet Gambling InvestigationRead the Press Release
Albany, New York —United States Attorney Richard S. Hartunian announced the filing of criminal complaints, in the Northern District of New York in Albany, that charge four individuals with federal money laundering and gambling felonies arising out of a multi-agency investigation of an international internet gambling operation. Four additional defendants were charged with New York State gambling offenses.
Philip Gurian of Boca Raton, Florida, and Michele Lasso of Delray Beach, Florida, are charged by federal complaint with the crime of conspiracy to launder monetary instruments. If convicted, Gurian and Lasso each face a maximum of 20 years in prison. Jay Goldman of Lake Worth, Florida, and Alan Gould of Plantation, Florida, are each charged by federal complaint with transmission of wagering information. If convicted, Goldman and Gould face a maximum of 2 years in prison. All four individuals charged with federal felonies were arrested at their homes in Florida and appeared before United States Magistrate Judge William Matthewman in the Southern District of Florida. Gurian has been detained pending a detention hearing in West Palm Beach, Florida, on Monday, April 15 th. Lasso, Gould ,and Goldman were ordered released on bond and other pretrial conditions and were directed to appear in U.S. District Court in the Northern District of New York before United States Magistrate Judge Randolph F. Treece on April 22, 2013 at 2:00 p.m.
Craig Hayner, Christopher Socola, Timothy Robillard, James Cerniglia, all of Clifton Park, and Joseph Carucci of Latham, are charged in Albany County by felony complaints alleging enterprise corruption. Robillard and Cerniglia are correction officers with the Albany County Sheriff’s Office.
These charges are the result of a joint investigation initiated by the Albany County Sheriff’s Office, and joined by the Albany County District Attorney’s Office, the Saratoga County District Attorney’s Office, the Federal Bureau of Investigation, the Internal Revenue Service, the Broward County Money Laundering Task Force, and the Office of the United States Attorney for the Northern District of New York. The federal case is being prosecuted by Assistant U.S. Attorneys Robert L. Sharpe and Jeffrey Coffman.
As a part of the ongoing investigation, the Federal Bureau of Investigation and the Internal Revenue Service applied for and obtained a total of fifteen search warrants in Florida, New Hampshire and California and a seizure warrant for numerous bank accounts in the Northern District of New York. The Albany County Sheriff’s Office applied for and obtained two search warrants for locations in Albany County. Seizures so far seized have included more than $1 million in U.S. Currency.
U.S. Attorney Hartunian said , “Gambling on sporting events is strictly regulated and, in most cases, prohibited outright under federal and state law. Internet gambling operations may be perceived as offering privacy and anonymity to bookmakers and bettors, but the outstanding cooperative efforts of the federal, state, and local law enforcement agencies who participated in this investigation are shining a spotlight through the electronic mist onto the alleged conduct of these defendants.”
Albany County Sheriff Craig Apple stated, “Today’s arrests end one phase of a multi-year investigation. We will continue to work with the District Attorney, U.S. Attorney’s Office, and the FBI to combat illegal gambling and seek out other Officers that may have been involved in this bookmaking ring.”
Albany County District Attorney P. David Soares stated, “While interstate investigations can be very lengthy and resource intensive, when partnerships between local, state, and federal authorities are leveraged we are all able to hold individuals accountable to the fullest extent of the laws available to each agency. The success of this investigation was due to cooperation between several law enforcement partners and I thank United States Attorney Richard S. Hartunian, Albany County Sheriff Craig Apple and his staff of investigators, and the FBI and the IRS for their respective roles in this long term case. I would also like to recognize the efforts of Saratoga County District Attorney Jim Murphy and his staff for their assistance throughout this investigation.”
Saratoga County District Attorney James A. Murphy, III said,"We are very fortunate to have so many law enforcement agencies and prosecutorial offices in the area that work so well together. This investigation exemplifies such a collaborative effort because this particular criminal enterprise extended well beyond one jurisdiction and required the endeavors of many law enforcement agencies to bring about the common goal of holding these individuals responsible for their actions."
FBI Special Agent in Charge Andrew W. Vale stated, “I commend the long-term collaborative efforts of our law enforcement partners throughout this complex investigation.”
IRS-Criminal Investigation Special Agent in Charge Toni Weirauch stated, “IRS-Criminal Investigation is always eager to work with our law enforcement partners on complex financial investigations. The investigation of money laundering and the underlying crime that laundering seeks to conceal remains a top priority for us.”
A criminal complaint is merely a formal charge that a defendant has committed a violation of federal criminal law, and every defendant is presumed innocent until, and unless, proven guilty.
Renz Indicted on Federal Child Pornography ChargesRead the Press Release
U.S. Attorney’s Office Continues to Assist the
District Attorney on the Homicide, Rape, and Carjacking InvestigationSyracuse, New York —A federal grand jury in Syracuse returned an indictment today charging David J. Renz, 29, of Cicero, New York with one count of receiving child pornography and five counts of possession of child pornography, announced United States Attorney Richard S. Hartunian and Special Agent-in-Charge Andrew W. Vale of the Albany Division of the Federal Bureau of Investigation. If convicted, Renz faces a mandatory minimum of 5 years in prison and a maximum of 20 years in prison on the receiving child pornography charge; a maximum of 10 years in prison on each of the possession of child pornography charges; supervised release of no less than 5 years and up to life; and mandatory registration as a sex offender on all of the charges.1
Renz was previously arrested, on January 9, 2013, by the Federal Bureau of Investigation (“FBI”) in connection with these child pornography charges. According to the indictment, between 2010 and June 2012, Renz received child pornography through the internet using a homemade computer. The possession charges relate to five DVD and CD’s which Renz possessed at the time the FBI executed a federal search warrant at his residence on January 9, 2013.
On March 15, 2013, Renz was arrested again by state authorities in connection with a carjacking, murder, and rape in Clay, New York. U.S. Attorney Hartunian said, “In addition to our federal prosecution of the child pornography charges, my office is continuing to work closely with the Onondaga County District Attorney on these horrific carjacking, murder, and rape offenses.” This case is being investigated by the Federal Bureau of Investigation.
This case is being prosecuted by Assistant United States Attorney Lisa Fletcher. For further information, please contact Executive Assistant U.S. Attorney John G. Duncan at (315) 448-0672.
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1The charges are merely accusations, and the defendant is presumed innocent until and unless proven guilty.
Ehrlich Pleads Guilty to Obstruction of JusticeRead the Press Release
Albany, New York – United States Attorney Richard S. Hartunian and Special Agent-in- Charge Andrew Vale of the Albany Division of the Federal Bureau of Investigation announce that David A. Ehrlich, 38, of Cohoes, a former lawyer, pled guilty yesterday to obstruction of justice, as charged in Count 1 of the Indictment filed December 12, 2012. Ehrlich’s guilty plea was entered in an appearance before Chief United States District Judge Gary L. Sharpe in Albany.
As part of his guilty plea and plea agreement, Ehrlich admitted that he obstructed justice in United States v. Joseph P. Brown, a criminal appeal before the United States Court of Appeals for the Second Circuit, by preparing and providing to Brown’s wife a brief Ehrlich falsely represented had been filed, and then preparing and providing to Brown’s wife a document Ehrlich falsely represented to be the written decision of the United States Court of Appeals for the Second Circuit denying Brown's appeal. Ehrlich admitted that:
On July 18, 2007, in U.S. District Court for the Northern District of New York, Joseph P. Brown was sentenced to be imprisoned for 60 months upon his conviction of possession of child pornography. Timely notice of appeal was filed on Brown’s behalf. Ehrlich did not represent Brown in the District Court case, but agreed to handle Brown’s appeal, and obtained $7500 from Brown’s wife as payment. Ehrlich later provided Mrs. Brown with a ten page document dated November 20, 2007, that Ehrlich represented to be the appellate brief he had prepared and submitted. The document requested that Brown’s “plea of guilty be vacated, or alternatively that this matter be remanded to the district court for sentencing consistent with Rita v. United States and Gall v. United States.” In truth and in fact, Ehrlich never submitted a brief for Brown to the Court of Appeals. The Court of Appeals had set a deadline of October 22, 2007, for a brief to be filed on behalf of Brown, and then extended the deadline to November 30, 2007. When no brief was filed, the Court of Appeals issued an order to show cause why the appeal should not be dismissed for failure to file a brief by the date specified in the scheduling order. There was no response, so Brown’s appeal was dismissed by the Court of Appeals by order filed January 16, 2008; the mandate was issued on March 17, 2008.
Ehrlich later provided Mrs. Brown with a document dated May 13, 2008, that appeared to be, and was represented by Ehrlich to be, the written decision of the United States Court of Appeals for the Second Circuit denying Brown’s appeal. In truth and in fact, Ehrlich had falsely prepared the document he misrepresented to be the Court’s decision using language from the opinion of the United States Supreme Court in Strickland v. Washington, 466 U.S. 668 (1984), pages 684 -689; the unpublished opinion of the United States Court of Appeals for the Second Circuit in Grune v. Coughlin, 152 F.3d 918, 1998 WL 382608 (2d Cir. May 7, 1998), pages 1-2; and the opinion of the United State Supreme Court in Rita v. United States, 551 U.S. 338 (2007), pages 350-351 and 356. The fake decision prepared by Ehrlich falsely stated that the appeal had been argued on December 19, 2007, before Chief Judge Jacobs, Judge Pooler, and Judge Sack, and falsely stated that the Court affirmed Brown’s sentence upon its holding “that the plea of Brown was knowing and voluntary, that he was adequately represented by counsel, and that the sentencing court did not err in the imposition of sentence.”
Because Joseph P. Brown had been denied his right to pursue an appeal by the conduct of DAVID A. Ehrlich, Brown had to prepare and file a motion under 28 U.S.C. § 2255 to vacate, set aside, or correct his sentence upon his claim that he was denied effective assistance of counsel, and the U.S. District Court had to enter a new judgment so Brown could pursue an appeal.
Ehrlich was released pending sentencing, which is scheduled for July 29, 2013, at 9:00 am, in Albany. Ehrlich faces a maximum sentence of up to 10 years imprisonment, to be followed by supervised release for up to 3 years, a fine of up to $250,000, and a special assessment of $100. Ehrlich agreed to make restitution of the $7500 paid by the Browns and a total of $1400 paid him by two other clients, and has done so.
On April 22, 2010, Ehrlich was disbarred in New York by the Supreme Court, Appellate Division, Third Department.
United States Attorney Hartunian said, “Due process of law is the cornerstone of our democracy. When due process is subverted by a lawyer with a sworn duty to represent faithfully the interests of a defendant, it is a significant crime. The vigilance and outstanding work by the Albany Division of the Federal Bureau of Investigation and state agencies such as the Committee on Professional Standards for the Third Judicial Department of the Appellate Division of the Supreme Court for the State of New York and The Lawyers’ Fund for Client Protection of the State of New York restores fairness to the administration of justice.”
The investigation was conducted by the Albany Division of the Federal Bureau of Investigation. The case is being prosecuted by First Assistant U.S. Attorney Grant C. Jaquith, to whom inquiries may be directed at (518) 431-0247.
Two Brothers from Bricktown Gang Each Sentenced to 87 MonthsRead the Press Release
RICHARD S. HARTUNIAN, United States Attorney, Northern District of New York, announces that brothers MIGUEL RUSSO, age 24, and MIQUAN RUSSO, age 23, both of Syracuse, were sentenced today in U.S. District Court in Syracuse to 87 months imprisonment each for their roles in conspiring to engage in a pattern of racketeering activity through their membership in the Bricktown Gang, a violent street gang operating on the streets of Syracuse.
As part of their pleas, both RUSSO’s admitted that the Bricktown Gang operated within the City of Syracuse from at least 2000 through the present and that members of the Bricktown Gang: (1) maintain a specific geographic territory within the City of Syracuse in which only gang members can sell crack cocaine, cocaine and marijuana; (2) protect that exclusive crack distribution territory with violence if necessary; (3) obtain drugs from suppliers in New York City and elsewhere; (4) project a very violent attitude and respond to violence with violence in order to preserve their stature in the gang community; (5) on occasion use hand signs, wear blue colored bandanas and have tattoos, all of which are intended to signify their gang membership; (6) use criteria such as willingness to use violence, ability to sell drugs, and familial connections to determine membership; and (7) routinely carry and use firearms in connection with their gang activity.
This prosecution resulted from a long-term investigation conducted by the Syracuse Gang Violence Task Force, which is comprised of agents and detectives from the following agencies: United States Department of Justice, Bureau of Alcohol, Tobacco, and Firearms (Syracuse Office), the Syracuse Police Department, the Onondaga County Sheriff's Department, the New York State Troopers, and the United States Marshals Service. The Onondaga County District Attorney’s Office also assisted in the investigation.
Further questions or inquiries may be directed to Assistant U.S. Attorney, John M. Katko, who is handling the case, at (315) 448-0672.
Bennington Man SentencedRead the Press Release
Used USDA Inspection Legend Fraudulently
Albany, New York — CRAIG ACTON, age 44, of Bennington Vermont, was sentenced today by Chief United States District Judge Gary L. Sharpe to 2 years of probation and 50 hours of community service for his fraudulent use of a United States Department of Agriculture inspection legend on meat products that he sold commercially, announced United States Attorney Richard S. Hartunian. ACTON previously entered a guilty plea on August 23, 2012.
Between January and June of 2011, in Greene County and elsewhere in New York, ACTON purchased meat products commercially, repackaged that meat using the “USDA” inspection legend stamp of another company, and then resold the meat commercially without authorization. ACTON intended to mislead the consumers who purchased his product into believing that his product was properly inspected.
United States Attorney Hartunian praised the outstanding efforts of the Department of Agriculture’s Office of Inspector General and Food Safety Inspection Service in this investigation. He stated, “The public relies on the integrity of our food supply, and my office will aggressively prosecute anyone who fraudulently subverts the USDA’s important food safety regulations.”
This case was investigated by the United States Department of Agriculture’s Office of Inspector General and Food Safety Inspection Service .
Renz Held Without Bond in Federal CaseRead the Press Release
Syracuse, New York —United States Magistrate Judge Andrew T. Baxter ordered that David Renz be held without bond pending the resolution of charges that he received and possessed child pornography, announced United States Attorney Richard S. Hartunian. When Renz was arrested on these charges on January 9, 2013, he had no criminal history, and he was released on a number of conditions including electronic monitoring.
On March 14, 2013, just after 7:00 p.m., Renz tampered with the electronic monitoring system he was required to wear as part of his conditions of release. His tampering prevented any alerts to the United States Probation Office until approximately 11:30 p.m., when the Probation Office received an alert indirectly that there had been no motion by the device for a period of time.
At approximately 12:32 a.m., the United States Probation Office was notified that Renz had been arrested in connection with a kidnapping, murder, and rape in Clay, New York.
“My office is working with the Onondaga County District Attorney to make sure that the person who committed these horrific crimes is prosecuted to the fullest extent of the law,” said Hartunian.
Utica, New York - Two Utica area men arrested on charges of bank robbery.Read the Press Release
United States Attorney Richard S. Hartunian announced today the arrest of two Utica area men on charges of bank robbery.
ZACHARIAH EDWARDS, 21, of Frankfort, surrendered himself to authorities in Utica on March 8. He was transported to Syracuse where he was formally charged with robbery of $3,400 from the M&T Bank, 5170 West Taft Road, Syracuse, New York on March 4, 2013. On Monday, March 11, NICHOLAS FERRONE, 21, of Utica, surrendered himself to authorities in Syracuse. He was brought to federal court and formally charged with robbery of $4,409 from Chase Bank, 4425 East Genesee Street, Dewitt, NY on January 28, 2013.
According to the criminal complaints filed in these cases, EDWARDS and FERRONE are suspected of acting together and robbing the following banks:
Chase Bank, 6004 Court Street, Syracuse, New York on January 14, 2013;
Berkshire Bank, 2080 Western Avenue, Guilderland, New York on January 23, 2013;
Chase Bank, 4425 East Genesee Street, Dewitt, New York on January 28, 2013;
Trustco Bank, 2050 Western Avenue, Guilderland, New York on February 13, 2013;
Bank of America, 638 Memorial Drive, Chicopee, Massachusetts on February 25, 2013; and
M&T Bank, 5170 West Taft Road, Syracuse, New York on March 4, 2013.In addition, the papers filed with the court link FERRONE to a robbery of the Alliance Bank at 142 Genesee Street, Oneida, New York on January 3, 2013.
Both defendants appeared before United States Magistrate Judge David E. Peebles and were ordered held without bail. Detention hearings for both are scheduled for March 13, 2013 at 11:00 am in Syracuse. Bank robbery carries a maximum penalty of twenty years imprisonment and a fine of $250,000 for each count.
The investigation has been a multi-agency effort, including participation by the Dewitt Police Department, the New York State Police, the Guilderland Police Department, the Oneida Police Department, the Onondaga County Sheriff’s Office, Chicopee, Massachusetts Police Department, Schenectady Police Department and the Federal Bureau of Investigation. The case is being prosecuted by AUSA Edward R. Broton.
The charges are merely accusations and the defendants are presumed innocent until and unless proven guilty.
Watertown Man Sentenced to 15 Years Pursuant to the Armed Career Criminal StatuteRead the Press Release
RICHARD S. HARTUNIAN, United States Attorney, Northern District of New York announces that SHAWN J. ADAMS (39, of Watertown, NY) was sentenced to today by United States District Court Judge Glenn T. Suddaby to 15 years imprisonment for being a three time convicted felon in possession of a firearm.
The charges stemmed from an incident on November 8, 2010, at approximately 1:00 a.m., when the Watertown Police Department received complaint involving a man with a gun that had entered the complainant’s residence through an open third floor window. Upon arrival at the third floor apartment, Watertown police officers located SHAWN J. ADAMS asleep on a couch along with a gun case near an open window. The officers then woke ADAMS and arrested him. Thereafter, ADAMS stated that the firearm in the gun case belonged to him and that the gun was a Remington. The officers then opened the gun case and located a Remington, SPR 453, 12 gauge, semi-automatic shotgun manufactured in Russia.
ADAMS had been previously convicted of crimes punishable by a term of imprisonment exceeding one year, that being: (1) a conviction in Saint Lawrence County Court on February 7, 1994, for the felony crime of Burglary in the Third Degree; (2) a conviction in Jefferson County Court, on October 26, 1998, for the felony crime of Attempted Burglary in the Third Degree; and (3) a conviction in Suffolk County Court on November 15, 2001, for the felony crime of Attempted Burglary in the Second Degree.
This prosecution resulted from an investigation conducted by the United States Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) Syracuse Office, the Watertown Police Department, and the New York State Police Troop D Unit. The case was prosecuted by Assistant United States Attorney Ransom P. Reynolds. Further questions may be directed to Executive Assistant U.S. Attorney John Duncan at (315) 448-0672.
Rexford Woman Convicted of Harboring an Illegal AlienRead the Press Release
Albany, New York — A jury convicted Annie George, a/k/a Annie Kolath, a/k/a Sajimol George, age 40, of harboring an illegal alien following a five-day trial announced United States Attorney Richard S. Hartunian and Matthew Scarpino, Resident Agent-in-Charge, U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI). Sentencing is scheduled for July 9, 2013 at 11:00 a.m. before the Honorable Gary L. Sharpe, Chief U.S. District Judge. George faces a maximum term of imprisonment of five years and a fine of up to $250,000.
According to the indictment, George harbored an illegal alien from India between about November 2005 and May 3, 2011 in George’s homes in Catskill, Menands, and Rexford, New York.
United States Attorney Hartunian stated: “This case demonstrates our commitment to investigate and prosecute those who harbor illegal aliens. We commend the U.S. Department of Homeland Security’s HSI for the thoroughness and professionalism demonstrated by their Special Agents throughout the course of this case.”
“Today’s conviction is a testament to our solemn commitment to protect those who cannot protect themselves,” said Matthew Scarpino, Resident Agent-in-Charge of HSI Albany. “HSI is committed to giving the victims the help they need to come forward with vigorous enforcement and tough penalties.”
This case was investigated by U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI). This case is being prosecuted by Assistant United States Attorney Rick Belliss.
LOCAL CONTACT:
Rick Belliss
Assistant U.S. Attorney
Tel: (518) 431-0247TextAccountant Fined and Sentenced to ProbationRead the Press Release
ALBANY, N.Y. — Ronald L. Simons, 58, of Vestal, New York, was sentenced today to one year probation and ordered to pay a $5,000 fine by United States Magistrate Judge Christian F. Hummel, announced United States Attorney Richard S. Hartunian, Special-Agent-in-Charge Toni M. Weirauch of the Internal Revenue Service, Criminal Investigation, New York Field Office, and Andrew W. Vale, Special Agent-in-Charge, Federal Bureau of Investigation, Albany Division. The sentencing follows Simons’ November 8, 2011 guilty plea.
In October 2007, Simons, a certified public accountant and partner in the accounting firm of Piaker & Lyons in Binghamton, New York, submitted a false 2006 income tax return on behalf of David L. and Lynn A. Smith. David L. Smith is a former owner of the Albany broker-dealer McGinn, Smith & Co., Inc., and was convicted of conspiracy to commit mail and wire fraud, mail fraud, wire fraud, securities fraud, and filing false tax returns on February 6, 2013 following a fourweek jury trial.
The return, prepared and submitted to the Internal Revenue Service by Simons, did not report $407,000 in fees distributed to David L. Smith from TDM Funding LLC in 2006. Simons reclassified the $407,000 as loans despite knowing that the McGinn Smith controller initially booked the $407,000 as fees and that David L. Smith previously characterized the majority of the $407,000 as fees.
This case was investigated by the Internal Revenue Service, Criminal Investigation and the Federal Bureau of Investigation. This case was prosecuted by Assistant United States Attorneys Elizabeth C. Coombe, Richard D. Belliss, and Wayne A. Myers.
LOCAL CONTACT:
Elizabeth C. Coombe
Assistant U.S. Attorney
Tel: (518) 431-0247Norfolk, Virginia - Man was sentenced to serve a 16 month term of imprisonment followed by two years of supervised release following his guilty plea to unlawful sale of a firearm to an unauthorized person.Read the Press Release
RICHARD S. HARTUNIAN, United States Attorney for the Northern District of New York, announced that yesterday TERRY DUNLAP., age 28, of Norfolk, Virginia, was sentenced in U.S. District Court in Utica to serve a 16 month term of imprisonment followed by two years of supervised release following his guilty plea to unlawful sale of a firearm to an unauthorized person. Dunlap pled guilty to selling an Iberia Arms .40 caliber semiautomatic pistol on the street in Watertown, New York to an unknown person in August 2007. The pistol was recovered by Syracuse Police during a vehicle stop on September 27, 2007. A trace of the pistol’s serial number led ATF Special Agents in Virginia to interview Dunlap, the pistol’s last known owner. Dunlap initially falsely claimed to Norfolk ATF Agents, that he was still in possession of the firearm. Dunlap subsequently admitted that he sold the firearm in August 2007 to an unknown person in Watertown. Still later, Dunalp admitted to selling a second pistol to an unknown person in Syracuse, New York in October 2007.
This case was investigated by the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (“ATF”) Field Offices in Syracuse, New York and Norfolk, Virginia. Assistance was also provided by the Syracuse Police Department. The case was prosecuted by Assistant U.S. Attorney Richard R. Southwick.
Gansevoort Man Sentenced for Receiving Child PornographyRead the Press Release
Defendant Who Received Multiple Still Images and Videos of Child Pornography Sentenced
to 96 Months in PrisonAlbany, New York — WAYNE L. CONRAD, JR., age 47, of Ganesvoort, New York, was sentenced today by United States District Court Judge Mae A. D’Agostino, in Albany to ninety-six (96) months of imprisonment for receiving child pornography images, announced United States Attorney Richard S. Hartunian, Andrew W. Vale, Special Agent-in-Charge, Federal Bureau of Investigation, Albany Division, and Joseph D’Amico, Superintendent of New York State Police. CONRAD, who had entered a guilty plea on October 15, 2012, was also ordered to have no unsupervised contact with minors and to register with the New York State Sex Offender Registry Program.
Between May 2007 and February 1, 2012, CONRAD used the Internet to access various child pornography websites and various file sharing networks. While accessing some of the child pornography websites or file sharing networks, CONRAD downloaded multiple still images and videos of child pornography onto his home computer and external hard drives.
This case was investigated by the Federal Bureau of Investigation and the New York State Police.
LOCAL CONTACT:
Rick Belliss
Assistant U.S. Attorney
Tel: (518) 431-0247Multiple Charges Lodged Against Terrell Wright for Pointing A Gun at Gang InvestigatorsRead the Press Release
RICHARD S. HARTUNIAN, United States Attorney, Northern District of New York, announces that a three-count Indictment was returned today in United States District Court charging TERRELL WRIGHT, age 28, of Syracuse, with: (1) assaulting two detectives from the Syracuse Gang Violence Task Force (“GVTF”) (Count One); (2) use and carry of a handgun during the assault (Count Two); and (3) being a convicted felon in possession of a handgun (Count Three).1
The charges arose from an incident on December 18, 2012 in which WRIGHT pulled a handgun from his waistband and pointed it at two Syracuse Police detectives from the GVTF. WRIGHT then fled the scene and was apprehended minutes later. The gun used in the assault - a loaded .40 caliber semi-automatic handgun - was recovered.
If convicted of these crimes WRIGHT faces the following penalties:
Count One: Up to 20 years imprisonment, followed by three years of supervised release, and up to a $250,000 fine;
Count Two: At least seven years imprisonment that must run consecutive to any sentence on Counts One and Three, followed by three years of supervised release, and up to a $250,000 fine;
Count Three: Up to 10 years imprisonment, followed by three years of supervised release, and up to a $250,000 fine;
Further questions or inquiries may be directed to Assistant U.S. Attorney John M. Katko, who is prosecuting the case, at (315) 448-0672.
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1The charges are merely accusations and the defendant is presumed innocent until and unless proven guilty.
Syracuse, New York - Six members of a stolen mail/counterfeit check cashing ring plead guilty.Read the Press Release
RICHARD S. HARTUNIAN, United States Attorney for the Northern District of New York, and KEVIN NILAND, Inspector in Charge, Boston Division of the U.S. Postal Inspection Service, announced that yesterday and today six members of a stolen mail/counterfeit check cashing ring pled guilty in Federal Court in Syracuse. Yesterday, Jamaine L. Ryder, 37, of Charlotte, NC; Wallik Ryer, 37, of Oswego, NY; Diana Sacco, 29, of Fulton, NY; Timothy Matthew Johnson, 37, of Syracuse, NY and Charles Koflan, 55, of Pennelville, NY, all entered pleas to conspiracy to commit mail fraud and commission of mail fraud in U.S. District Court in Syracuse. A sixth man, Peter Napolitano, 27, of North Syracuse, N.Y. pled guilty today to conspiracy to commit mail fraud and possession of stolen mail. Jamaine Ryder, Wallik Ryer, and Peter Napolitano will be sentenced on June 17, 2013. Diana Sacco, Timothy Matthew Johnson, and Charles Koflan will be sentenced on June 19, 2013 in Syracuse, NY. They face sentences of up to thirty years imprisonment and fines of up to a million dollars for these federal felony offenses.
Three other defendants have previously pled guilty and are awaiting sentencing. Arcenio Sepulveda, 46, of Syracuse, NY, pled guilty to the same offenses on October 16, 2012 and will be sentenced on March 26, 2013 in Syracuse, NY. Warren G. Johnson pled guilty on December 13, 2012 and will be sentenced on April 17, 2013. Marsha O’Berry pled guilty on November 1, 2011 and will be sentenced on March 27, 2013.
An additional defendant, Donald Ryder, 33, of Charlotte, North Carolina was sentenced on January 17, 2013 to serve 46 months imprisonment, followed by five years of supervised release and restitution in the amount of $101, 071.18.
The ring, based in Charlotte, North Carolina, obtained stolen corporate checks from the mail boxes of local businesses in Syracuse, Binghamton and Oswego. The leaders of the group recruited homeless people, drug addicts and others to cash the stolen checks in return for a small portion of the proceeds. The stolen checks were altered to show the check casher’s names as the payees. On November 29, 2010 Syracuse based Postal Inspectors followed members of the ring as they cashed stolen checks at banks in Dewitt. When Postal Inspectors and Dewitt Police moved in to make a traffic stop, a high speed chase ensued through Dewitt during which $18,000.00 was thrown from a vehicle driven by Donald Ryder and occupied by Wallik Ryer as a passenger. The money was recovered by police. The conspiracy operated from November 2010 through June 2011 in Binghamton, Syracuse, and Oswego, New York and resulted in the passing of counterfeit checks worth $141,008.09.
This case was investigated by United States Postal Inspectors from Syracuse, New York and Charlotte, North Carolina. They were assisted in the investigation by Police Departments from the Town of Dewitt and the Village of East Syracuse. The case was prosecuted by Assistant U.S. Attorney Richard R. Southwick.
Syracuse Man Enters Guilty Plea to Credit Card Fraud, Aggravated Identity Theft and Possession of A FirearmRead the Press Release
RICHARD S. HARTUNIAN, United States Attorney, Northern District of New York announces that KAREEM HIGHSMITH (37, of Syracuse, New York) entered a guilty plea to an indictment charging him with access device fraud, in violation of Title 18, United States Code, Section 1029(a)(1), and aggravated identity theft, in violation of Title 18, United States Code, Section 1028A. KAREEM HIGHSMITH also entered a guilty plea to a separate indictment charging him with being a convicted felon in possession of a firearm, in violation of Title 18, United States Code, Section 922(g)(1).
On June 13, 2011, KAREEM HIGHSMITH used a counterfeit access device to make purchases at Wegmans in Fayetteville, New York, and at Price Chopper in Syracuse, New York. Specifically, HIGHSMITH used a counterfeit credit card to make purchases using a re-encoded card issued to another person by American Express. Between June 9, 2011 and June 13, 2011, HIGHSMITH used this counterfeit credit card to make purchases totaling approximately $5,000.00 in the Syracuse area. On February 13, 2012, HIGHSMITH possessed on his computer at his residence 399 credit card account numbers that belonged to other persons. The defendant also possessed at his residence equipment used to manufacture counterfeit credit cards and a Kimber .45 caliber pistol.
The defendant is facing a statutory maximum sentence of 10 years imprisonment, a mandatory minimum term of imprisonment of 2 years, a term of supervised release of up to 3 years, and a maximum fine of $250,000.00. The sentencing is scheduled for June 17, 2013 in Syracuse, NY.
These arrests followed a lengthy investigation conducted by the United States Secret Service, Syracuse Resident Office, the Syracuse Police Department, the New York State Police, and the Manlius Police Department. The case is being prosecuted by Assistant United States Attorney Ransom P. Reynolds. Further questions may be directed to Executive Assistant U.S. Attorney John Duncan at (315) 448-0672.
Utica Woman Sentenced in Fraud CaseRead the Press Release
United States Attorney Richard S. Hartunian announced today that a Utica woman has been sentenced for her role in an insurance and health care fraud scheme.
Today CYNTHIA MORGAN, age 54, was sentenced by United States District Court Judge Norman A. Mordue in Syracuse. MORGAN was sentenced to 27 months imprisonment and ordered to pay restitution in an amount exceeding $1.4 million. MORGAN will also serve three years of supervision following her release from incarceration. She was remanded to prison immediately following sentencing.
MORGAN pled guilty on August 23, 2012 to conspiracy to commit mail and health care fraud. MORGAN admitted that in or about 2005 she agreed with Joseph Demme, Joseph Dellerba, Michael Matrulli and her husband David Morgan to participate in an insurance and health care fraud scheme. The scheme involved a staged motor vehicle accident on Harbor Lock Road in Utica on March 20, 2006. On that date, MORGAN claimed to have been driving a Ford van which was struck by a Ryder truck driven by Matrulli. In fact, the collision was staged and MORGAN was not injured. The defendant, however, claimed to have been injured as a result of the accident and submitted false insurance claims, including claims for personal injuries, no fault benefits and disability benefits. MORGAN sought medical treatment for non-existent injuries or injuries that were not related to the collision. The bills for this medical care were submitted to and paid by a health care benefit program, specifically an insurance policy issued by Progressive Insurance Company. MORGAN collected $108,000 from Mutual of Omaha under a disability policy with that company. MORGAN also commenced a civil lawsuit seeking damages for personal injuries sustained in the accident. She received a payment of $30,000 to settle that suit.
The case was investigated by the Federal Bureau of Investigation and the New York State Insurance Frauds Bureau. The case was prosecuted by Assistant United States Attorney Edward R. Broton.
Woodstock Doctor Sentenced on Drug Distribution ChargesRead the Press Release
Albany New York--RICHARD S. HARTUNIAN, United States Attorney, Northern District of New York, announces that Dr. WAYNE D. LONGMORE, age 63, of Woodstock, New York, was sentenced on February 7, 2013, in Albany by the Honorable Lawrence E. Kahn, United States District Court Judge, to 6 months home detention, 3 years probation, 200 hours of community service, and ordered to forfeit his New York State medical license, and his DEA license to issue narcotic drugs. In addition to these penalties Dr. Longmore was ordered to pay a $200,000 money judgment which represents proceeds of his drug trafficking activities.
Dr. Longmore previously pled guilty on October 17, 2012, to a felony Information that charged him with knowingly and intentionally distributing and dispensing and possessing with intent to distribute and dispense hydrocodone, a Schedule III controlled substance, without a legitimate medical purpose and outside the usual course of professional practice, contrary to Title 21, United States Code, Sections 841(a)(1) and (b)(1)(E) and Title 21, Code of Federal Regulations, Section 1306.04.
The Plea Agreement states that:
(1) From in or around November 3, 2011, through on or about March 21, 2012, in the Northern District of New York and elsewhere, LONGMORE did knowingly and intentionally distribute and dispense and possess with intent to distribute and dispense hydrocodone, a Schedule III controlled substance, without a legitimate medical purpose and outside the usual course of professional practice.
(2) In order to earn illicit profits from his medical practice, LONGMORE wrote and issued unlawful prescriptions to individuals for drugs containing controlled substances without a legitimate medical purpose and outside the usual course of professional practice.
(3) Longmore wrote these prescriptions in return for $60 cash payments. Longmore would write the illicit prescriptions for only a 7 day period.
(4) Contrary to accepted medical practice, LONGMORE prescribed Schedule III controlled substances to individuals at their first appointment with him and without conducting a thorough
Four Syracuse Area Defendants Plead Guilty in Federal Court to Conspiracy to Distribute Synthetic Drug “molly”Read the Press Release
Syracuse, NY—United States Attorney Richard S. Hartunian announced that four individuals entered guilty pleas yesterday in U.S. District Court in Syracuse to conspiring to distribute a controlled substance analogue, known on the street as “Molly.” The pleas were in connection with a large scale drug trafficking conspiracy, based in Central New York, that involved twenty-two coconspirators located in New York, California, Texas, Virginia and the Peoples Republic of China. Yesterday’s proceedings brings the number of defendants entering guilty pleas to sixteen. Five remaining defendants are scheduled to go on trial on April 29th in Syracuse. One defendant, Lei Zhang, a.k.a., Eric Chang, remains a fugitive.1
Appearing before U.S. District Judge, Glenn T. Suddaby, WILLIAM HARPER (age 54) of Syracuse, NY, CHARLES DEMOTT, JR. (age 45) of Liverpool, NY, and MARY OOTGAMBUZZA, (age 45), of East Syracuse, NY, and JON RADWAY, (age 33) of Pompey, NY, admitted to conspiring to distribute 4-Methylmethcathinone (4-MMC) and 4-Methyl-NEthylcathinone (4-MEC), often referred to as “Molly.” 4-MMC and 4-MEC are controlled substance analogues of a Schedule I controlled substance also referred to, on the street, as ‘Bath Salts’. HARPER also entered a guilty plea to money laundering, a federal felony, in admitting that he wired $2700 from a Bank of America account in the name of Orange Line Gallery, Ltd. to CEC Limited, in Shanghai, China to pay for a quantity of “Molly”.
At sentencing, each defendant faces a term of imprisonment of up to twenty (20) years, up to a $1 million fine, and at least three (3) years of supervised release following any period of incarceration. Sentencings are scheduled for August, 2013.
These prosecutions resulted from an investigation first undertaken in the spring of 2009 by the Syracuse Resident Office of the Drug Enforcement Administration (DEA), the Onondaga County Sheriff’s Office, the Syracuse Police Department, Immigration and Customs Enforcement, the Onondaga County District Attorney’s Office, the United States Marshals Service, the New York State Police, and the United States Attorney’s Office for the Northern District of New York. The investigation, which included wiretaps revealed that this “Molly” trafficking organization was responsible for the distribution of over one hundred (100) kilograms of “Molly” during the course of the conspiracy from January 2010 through April 2011. The “Molly,” believed to be manufactured in factories in China, was shipped to distributors in the Syracuse area, as well as other areas in the United States.
The case is being prosecuted by Assistant U.S. Attorneys Carla Freedman and John Duncan. Further questions or inquiries may be directed to Executive Assistant United States Attorney John Duncan at (315) 448-0672.
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1As to these defendants, the charges are mere allegations and the defendants are presumed innocent unless and until proven guilty in a court of law. - 2 -
Fifth V-not Gang Member Pleads Guilty to Rico ConspiracyRead the Press Release
RICHARD S. HARTUNIAN, United States Attorney, Northern District of New York, announces that DONALD JOHNSON, JR., age 25, of Syracuse, pled guilty this morning in U.S. District Court in Syracuse to an indictment which charged him and ten others with conspiring to exploit their membership in the V-NOT Gang to engage in a pattern of racketeering activity which included acts of murder, attempted murder, drug trafficking, and robbery. JOHNSON is the fifth defendant to plead guilty in this case. The case against six co-defendants remains pending.1
At sentencing, JOHNSON faces up to life imprisonment, a $250,000 fine, and three years of supervised release following any period of incarceration. The Indictment to which JOHNSON pled alleges that from at least 2003 through May 2012 members of the V-Not Gang: (1) maintained a specific geographic territory within the City of Syracuse in which only gang members can sell crack cocaine and marijuana; (2) protected that exclusive crack distribution territory with violence; (3) obtained drugs from various suppliers; (4) projected a very violent attitude and responded to violence with violence in order to preserve their stature in the gang community; (5) used graffiti, hand signs, and tributes on their clothing to slain gang members to signify their gang membership; (6) used criteria such as a willingness to use violence, ability to sell drugs, and familial connections to determine membership; and (7) routinely carried and used firearms in connection with their gang activity.
There are multiple acts of violence and drug distribution set forth in the Indictment, including 1 murder, 10 other shootings, 8 other acts of gun possession, and 18 acts of crack distribution and/or possession with intent to distribute crack. With respect to the murder, the Indictment includes allegations that on November 26, 2010, gang member Kahari Smith shot and killed Kihary Blue on Interstate 81 in downtown Syracuse as part of an ongoing feud between the V-Not and Bricktown gangs.
This prosecution resulted from a long-term investigation conducted by the Syracuse Gang Violence Task Force, which is comprised of agents and detectives from the following agencies:
United States Department of Justice, Bureau of Alcohol, Tobacco, and Firearms (Syracuse Office), the Syracuse Police Department, the Onondaga County Sheriff's Department, the New York State Police, and the United States Marshals Service. The Onondaga County District Attorney’s Office and the Drug Enforcement Administration - Syracuse office, also assisted in the investigation.
Further questions or inquiries may be directed to Assistant U.S. Attorney John M. Katko, who is prosecuting the case, at (315) 448-0672.
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1The allegations contained in the Indictment are mere accusations; and the defendants are presumed innocent unless and until proven guilty in a court of law.
Bricktown Gang Memebr Sentenced to 150 Months in PrisonRead the Press Release
RICHARD S. HARTUNIAN, United States Attorney, Northern District of New York, announces that DARNELL WILLIAMS, age 27, of Syracuse, was sentenced today in U.S. District Court in Syracuse to 150 months imprisonment for his role in conspiring to engage in a pattern of racketeering activity through his membership in the Bricktown Gang, a violent street gang operating on the streets of Syracuse.
As part of his plea, WILLIAMS admitted that the Bricktown Gang operated within the City of Syracuse from at least 2000 through the present and that members of the Bricktown Gang: (1) maintain a specific geographic territory within the City of Syracuse in which only gang members can sell crack cocaine, cocaine and marijuana; (2) protect that exclusive crack distribution territory with violence if necessary; (3) obtain drugs from suppliers in New York City and elsewhere; (4) project a very violent attitude and respond to violence with violence in order to preserve their stature in the gang community; (5) on occasion use hand signs, wear blue colored bandanas and have tattoos, all of which are intended to signify their gang membership; (6) use criteria such as willingness to use violence, ability to sell drugs, and familial connections to determine membership; and (7) routinely carry and use firearms in connection with their gang activity.
This prosecution resulted from a long-term investigation conducted by the Syracuse Gang Violence Task Force, which is comprised of agents and detectives from the following agencies: United States Department of Justice, Bureau of Alcohol, Tobacco, and Firearms (Syracuse Office), the Syracuse Police Department, the Onondaga County Sheriff's Department, the New York State Troopers, and the United States Marshals Service. The Onondaga County District Attorney’s Office also assisted in the investigation.
Further questions or inquiries may be directed to Assistant U.S. Attorney, John M. Katko, who is handling the case, at (315) 448-0672.
Herkimer County Man Sentenced for Operating A Massive Marijuana Grow OperationRead the Press Release
SYRACUSE, NY – Richard S. Hartunian, United States Attorney for the Northern District of New York, announces that COREY LEITZ, age 42, of Frankfort, New York, was sentenced today in U.S. District Court in Syracuse to 151 months, followed by 5 years supervised release and a $100 special assessment. Leitz had previously pled guilty to a onecount information charging him with knowingly manufacturing over one thousand (1000) marijuana plants.
As part of the plea LEITZ admitted the following:
From August 2011 until December 14, 2011, LEITZ did knowingly manufacture marijuana plants at 162 McIntyre Road, Frankfort, New York. LEITZ set up and maintained a marijuana manufacturing operation inside a barn at this location. By December 14, 2011, LEITZ had successfully grown 3200 marijuana plants. LEITZ then sold the marijuana he manufactured to numerous customers in Herkimer County and elsewhere.
This marks the second felony drug conviction for Leitz who has a prior felony drug conviction in 1998 in Herkimer County.
This prosecution resulted from a joint investigation undertaken by the Drug Enforcement Administration, the New York State Police, and the New York National Guard Counterdrug Task Force. The case is being prosecuted by Assistant U.S. Attorney Geoffrey Brown. Further questions may be directed to Executive Assistant U.S. Attorney John Duncan at (315) 448-0672.
Founders of Mcginn, Smith & Co., Inc. Convicted of Conspiracy, Mail Fraud, Wire Fraud, Securities Fraud, and Filing False Tax ReturnsRead the Press Release
Albany, New York — A federal jury in Utica returned its verdict following the four-week trial of Timothy M. McGinn and David L. Smith, former owners of the Albany broker-dealer McGinn, Smith & Co., Inc., announced United States Attorney Richard S. Hartunian, Toni M. Weirauch, Special Agent-in-Charge, Internal Revenue Service, Criminal Investigation, New York Field Office, and Andrew W. Vale, Special Agent-in-Charge, Federal Bureau of Investigation, Albany Division. After 4 days of deliberation, the jury convicted McGinn of 27 of 29 counts and Smith of 15 of 29 counts. Both defendants were convicted of conspiracy to commit mail and wire fraud, mail fraud, wire fraud, securities fraud, and filing false tax returns.
U.S. Attorney Hartunian commented, “With today's guilty verdicts against Timothy McGinn and David Smith, a measure of justice has been achieved for the many investors who placed their trust - and in some cases, their life savings - in these two men and their brokerage firm. While the harm they have caused may never be fully undone, this verdict sends the strong message that fraudulent business practices and tax cheating will not be tolerated. Law enforcement will do everything possible to bring to justice those whose greed and self- interest make them lose sight of their responsibilities to investors and regulators.”
U.S. Attorney Hartunian also thanked the many agents, investigators, and analysts from the Internal Revenue Service and the Federal Bureau of Investigation for their tireless efforts and dedication to seeing that justice was served. He also congratulated the trial team from the United States Attorney's Office, including Deputy Criminal Chief Elizabeth C. Coombe, Assistant United States Attorneys Richard D. Belliss and Wayne Myers, and Information Technology Specialist Ron Kittelson, all of whom spent long hours preparing and presenting this complex case.
Special Agent-in-Charge Weirauch stated, "The guilty verdicts against Timothy M. McGinn and David L. Smith are a victory for the people of the Capital Region of New York and beyond. People must be able to trust those who invest money on their behalf. They must also trust that all Americans are paying their fair share of taxes. When that trust is violated, people suffer, and our economy as a whole suffers. IRS Criminal Investigation, along with our law enforcement partners, remains committed to ensuring that people who violate the law are held accountable for their actions."
Special Agent-in-Charge Vale stated, "The actions of Timothy M. McGinn and David L. Smith destroyed dreams and ruined lives, and although today's verdict will not erase the financial and emotional harm they caused, we hope their victims will find solace in knowing that they will now face consequences for their damaging actions. Today's verdict supports the commitment of the FBI and our law enforcement partners to bring to justice those individuals who engage in such fraudulent schemes."
According to the superseding indictment, the purpose of the conspiracy was to mislead investors and the Financial Industry Regulatory Authority, Inc. (“FINRA”) regarding the safekeeping and use of investor money raised by 17 trusts, one corporation, and other entities; the risks of the trust offerings; the performance of the underlying income streams; the source of investor payments; and the improper diversion of investor money in order to obtain money from investors and enrich themselves. As a result of the defendant’s conduct, the investors were not aware that the defendants had diverted approximately $4.1 million in connection with transactions related to the trusts for their own benefit and the benefit of another person.
The superseding indictment also alleged that, as part of the conspiracy, the defendants improperly diverted nearly $1 million; directed false accounting entries regarding those transactions in response to a document request from the broker-dealer’s regulator, FINRA; and caused the false accounting entries to be submitted to FINRA. The alleged improper diversions fell into two categories: (a) the improper diversion of more than $473,000 of investor money from an escrow account to pay preferred clients who had unrelated investments (between May 15, 2008 and July 8, 2009); and (b) the improper diversion of $525,000 from bank accounts for three unrelated investments to pay the broker-dealer’s employees (between November 14, 2008 and April 15, 2009). The superseding indictment also alleged that the defendants improperly used a corporation to conceal and disguise the true nature of the payroll diversions by passing the money from the three unrelated investments through that corporation and then to the broker-dealer. Finally, the superseding indictment alleged that the defendants misled FINRA about the preferred client diversions and the payroll diversions by (a) directing the creation of false accounting entries to conceal the true nature of these transactions in response to a document request from FINRA; and (b) causing the submission of these false accounting entries to FINRA. The maximum potential penalties for count 1 include imprisonment for 30 years, to be followed by supervised release for 5 years, and a fine of the greater of $1,000,000 or twice the gross pecuniary gain or loss.
Both McGinn and Smith were convicted on Counts 21 through 26 (securities fraud), which relate to the failure to disclose improperly diverted fees to investors in violation of federal securities laws. Counts 21 and 22 relate to $100,000 in fees paid in connection with TDM Verifier Trust 08, and Counts 23 through 26 relate to approximately $855,000 in fees paid in connection with Fortress Trust 08. All of these transaction fees were paid with investor money. The maximum potential penalty for each of Counts 21 through 26 is imprisonment for 20 years, supervised release for 3 years, and a fine of $5,000,000.
McGinn and Smith were also both convicted on the tax charges arising from their failure to declare the improperly diverted money on their personal tax returns for tax years 2006 through 2008 (Counts 27-29 for McGinn and Counts 30-32 for Smith). McGinn and Smith later described the money as “loans,” but did not list them as such on personal financial statements. When FINRA discovered the false loan accounting entries for the diverted money, the defendants misled FINRA by directing the creation of backdated promissory notes. The maximum potential penalty for each of Counts 27 through 32 is imprisonment for 3 years, supervised release for 1 year, and a fine of $100,000.
Both McGinn and Smith were convicted on Count 10, and McGinn was convicted of Counts 4 through 6 and 11 through 13.1 Those mail and wire fraud counts relate to the Firstline Series B Trusts, which raised money from investors in connection with a loan of $2.4 million to Firstline Security, Inc., a company that generated alarm contracts. The superseding indictment alleged that the defendants did not tell investors when Firstline filed for bankruptcy and defaulted on loans. In addition, their firm sold approximately $600,000 of one of the Firstline investments without any disclosure of the bankruptcy or defaults. McGinn directed that investors receive $2 million of lulling payments by transferring money from other entities controlled by McGinn and Smith.
McGinn and Smith were both convicted on Count 14, and McGinn was convicted on Count 7. Those mail and wire fraud counts relate to the Integrated Excellence Trusts, for which the defendants raised about $1.2 million from investors in connection with a loan to benefit Integrated Excellence, Inc., which generated alarm contracts. The superseding indictment alleged that the defendants knew that the payments received from the loan were not sufficient to pay investors, but McGinn directed that investors receive lulling payments by transferring money from other entities controlled by McGinn and Smith.
McGinn and Smith were both convicted of Counts 8 and 9. Those mail fraud counts related to the improper diversion of investor money from an escrow account to pay preferred clients who had unrelated investments.
McGinn was also convicted on Counts 15 and 16. Those counts involved the diversion of approximately $142,000 of investor money from an escrow account to make payments to investors in other trusts.
Both McGinn and Smith were convicted on Count 17, which involved $35,000 Smith took directly from an escrow account holding investor funds for Integrated Excellence Sr. Trust 08. McGinn was convicted on Counts 18, 19, 20 which involved approximately $310,000 that McGinn took directly from escrow accounts holding investor funds.
This case was investigated by the Internal Revenue Service, Criminal Investigation and the Federal Bureau of Investigation. This case is being prosecuted by Assistant United States Attorneys Elizabeth C. Coombe, Richard D. Belliss, and Wayne Myers.
The sentencings are set for June 28, 2013 at 10:00 am for McGinn and 11:00 am for Smith.
LOCAL CONTACT:
Elizabeth C. Coombe
Assistant U.S. Attorney
Tel: (518) 431-0247____________________________
1The maximum potential penalty for each of Counts 4 through 20 is imprisonment for 30 years, supervised release for 5 years, and a fine of the greater of $1,000,000 or twice the gross pecuniary gain or loss.
Utica Man Sentenced in Fraud CaseRead the Press Release
United States Attorney Richard S. Hartunian announced today that a Utica man has been sentenced for his role in an insurance and health care fraud scheme.
On January 31, 2013, JOSEPH DELLERBA, age 66, was sentenced by United States District Court Judge Norman A. Mordue in Syracuse. DELLERBA was sentenced to 30 months imprisonment and ordered to pay restitution in an amount exceeding $1.4 million, with $102,111 due immediately. DELLERBA will also serve three years of supervision following his release from incarceration.
DELLERBA pled guilty on September 17, 2012 to conspiracy to commit mail and health care fraud. DELLERBA admitted that in or about 2005 he agreed with other conspirators to participate in an insurance and health care fraud scheme. The scheme involved a staged motor vehicle accident on Harbor Lock Road in Utica on March 20, 2006. On that date, DELLERBA claimed to have been injured while a passenger in a Ford van which was struck by a Ryder truck driven by a coconspirator. In fact, the collision was staged and DELLERBA was not a passenger at the time of the impact. The defendant claimed to have been injured as a result of the accident and submitted false insurance claims, including claims for personal injuries, no fault benefits and disability benefits. DELLERBA sought medical treatment for non-existent injuries or injuries that were not related to the collision. The bills for this medical care were submitted to and paid by a health care benefit program, specifically an insurance policy issued by Progressive Insurance Company. DELLERBA also commenced a civil lawsuit seeking damages for personal injuries sustained in the accident. He received a payment of $682,297.21 to settle that suit.
The case was investigated by the Federal Bureau of Investigation and the New York State Insurance Fraud’s Bureau. The case was prosecuted by Assistant United States Attorney Edward R. Broton.
Syracuse Area Physician Required to Pay Civil Penalty for Violations of the Federal Controlled Substances ActRead the Press Release
Onondaga County physician settles for $60,000.00
(Syracuse, New York)- United States Attorney Richard S. Hartunian announced that in December of 2012, his office reached a civil settlement with Dr. William Beals, a Liverpool, New York physician, for $60,000.00. The settlement agreement provided for payments over time and Dr. Beals made his final payment to the United States on January 11, 2013. As part of the settlement agreement, Dr. Beals also voluntarily surrendered his Drug Enforcement Administration number, which enables physicians to prescribe controlled substances. The settlement was in connection with violations of the Controlled Substances Act.
On February 1, 2012, DEA investigators conducted an inspection of Dr. Beals’ office and subsequently questioned him about controlled substances he purchased between March 8, 2010 and January 25, 2012. According to the complaint filed in connection with the settlement, Dr. Beals had ordered approximately 5,000 Hydrocodone pills, a Schedule III controlled substance, and 1,100 Zolpidem pills, a Schedule IV controlled substance during this time period. Dr. Beals, however, not only was unable to provide purchase, dispensing, or destruction records for these drugs, he could not account for their whereabouts in any way.
The Controlled Substances Act was enacted to ensure that controlled substances are properly regulated and to help prevent drug diversion. To that end, practitioners who dispense controlled substances are required to properly maintain complete and accurate inventories and records of all controlled substances that they purchase, receive, dispense, or destroy.
Prescription drug abuse is a significant nationwide issue. According to U.S. Attorney Richard S. Hartunian, his office takes drug diversion very seriously and will aggressively pursue those who violate the Controlled Substances Act, especially if they are professionals in the medical field. “It simply is unacceptable for medical professionals to act irresponsibly when handling controlled substances. The potential for these substances to end up in the wrong hands is something we are not willing to risk, and we will take whatever steps are necessary to prevent this from happening.”
Sentences Imposed in Two Mortgage Fraud ProsecutionsRead the Press Release
Syracuse, NY—United States Attorney Richard S. Hartunian and IRS Criminal Investigation Division Special Agent in Charge Toni Weirauch, announced the sentences imposed in United States District Court in Syracuse on Kevin M. O’Connell and Kevin D. O’Connell, two defendants in a long-term mortgage fraud investigation.
Kevin M. O’Connell, 35, and Kevin D. O’Connell, 62, both of Albany, NY were each sentenced to 24 months incarceration by Senior District Court Judge Norman A. Mordue. In addition, Kevin M. O’Connell was ordered to pay restitution in the amount of $2,275,584.88 and to pay a forfeiture judgment in the amount of $4,628.886.48. Kevin D. O’Connell, was ordered to pay restitution in the amount of $2,136,444.09.
Kevin M. O’Connell was a principal of PB Enterprises and employed his father, Kevin D. O’Connell to assist in a series of transactions that defrauded banks that were offering mortgages in the Albany area. The essence of the fraud was that PB Enterprises found inexpensive properties, usually rental properties that were for sale. They then recruited buyers to purchase the property at higher prices, with promises that the buyer would pay “no money down” and would instead receive a check at the closing. In dozens of transactions, PB Enterprises fraudulently obtained mortgages for those purchasers at the higher purchase price by providing false information to the lenders. PB Enterprises then arranged with closing agents to submit documents to the lenders that disguised the fact that the purchase prices were inflated and that the purchaser and the principals of PB Enterprises were splitting the excess mortgage money. The mortgage lender was falsely led to believe that the mortgage proceeds were necessary to purchase the property, and had not been diverted to pay the buyer and PB Enterprises. The restitution figures imposed by Judge Mordue represent the losses suffered by the lenders from this practice.
The principals of another such organization, Team Title, who were engaged in a similar scheme, pled guilty and were sentenced previously in Albany. Another principal of PB Enterprises, Michael Crowley, is scheduled to be sentenced on February 5, 2013, in Syracuse. A closing agent used by PB Enterprises and Team Title, attorney Michael G. Bouchard, was found guilty of conspiracy and bank fraud after trial in Syracuse in December. Mr. Bouchard and his two paralegals are scheduled to be sentenced in April.
This case is the result of an investigation by the Internal Revenue Service, Criminal Investigation Division in Albany, NY. Further questions or inquiries may be directed to Assistant United States Attorney Michael Olmsted, the prosecutor handling the case, at (315) 448-0672.
Internet Scammer Indicted for FraudRead the Press Release
SYRACUSE, NEW YORK —United States Attorney Richard S. Hartunian announced that a Syracuse Federal Grand Jury has returned an indictment charging Alexandru Turcan, 29, with wire fraud, false use of a passport, and aggravated identity theft in violation of 18 U.S.C. § 1343, 1543 and 1028A. Turcan, originally from Chisinau, Moldova, is a lawful permanent resident of the United States. He was apprehended while entering the United States through Orlando, Florida.
The indictment alleges that Turcan conducted a scheme to defraud individuals who responded to advertisements listing vehicles on http://www.autotrader.com/, a website that displays automobiles for sale. Two victims, in responding to an advertisement posted by Turcan, believed they were purchasing a 2007 Chevrolet Silverado and a 1968 Ford Shelby Mustang. The victims, citizens of Connecticut and Georgia, wired $17,900 and $21,000 respectively to purchase the vehicles to a bank account established by Turcan in Syracuse, New York. Turcan opened the account under a false name using a counterfeited passport. After transferring the funds to Turcan’s bank account, the victims never received the vehicles they believed they had purchased.
If convicted of aggravated identity theft, Turcan faces a mandatory two year term of imprisonment that would run concurrently with any term of imprisonment imposed for conviction of wire fraud and false use of a passport. If convicted of wire fraud, Turcan faces a 20 year maximum term of imprisonment, a fine of up to $250,000, and an order of restitution compensating the victims for their losses. If convicted of false use of a passport, Turcan faces a 10 year maximum term of imprisonment, a fine of up to $250,000 and an order of restitution.
The indictment is merely an allegation and the defendant is presumed innocent unless and until proven guilty in a court of law.
This case was investigated by the Upstate Electronic Crimes Task Force including the Syracuse Police Department and the United States Secret Service, the Office of the Ohio Attorney General, the Federal Bureau of Investigation, Diplomatic Security Services, and the Department of Homeland Security, Connecticut State Police Computer Crimes Unit. The case is being prosecuted by Assistant U.S. Attorney Gwen Carroll. For further information, contact Executive Assistant U.S. Attorney John G. Duncan at 315-448-0672
Town of Binghamton Woman Sentenced for Filing A False Tax ReturnRead the Press Release
Richard S. Hartunian, United States Attorney, Northern District of New York, announced today that Jacqueline MacBlane of the Town of Binghamton, Broome County, New York was sentenced in Federal Court in Binghamton by Senior U.S. District Judge Thomas J. McAvoy in connection with her August 1, 2012, guilty plea to an Information charging her with Subscribing to a False Individual U.S. Income Tax Return. Judge McAvoy sentenced MacBlane to a term of two years of probation supervision and ordered her to perform100 hours community service, pay a $30,000 fine, and make restitution of $78,729. The defendant admitted at the time of her plea that she willfully subscribed to a U.S. Individual Form 1040 Tax Return, for tax year 2007, which substantially and materially understated her adjusted gross income and taxable income. During the 2007 tax year, the defendant managed and operated the Brackney Inn in Susquehanna County, Pa., and her husband managed and operated Charley’s Tavern in Broome County, New York.
During the tax years 2006 and 2007, the defendant filed Individual U.S. Income Tax Returns using the filing status of “married filing jointly.” As part of the plea agreement, the defendant acknowledged that she also underreported taxable income for the tax year 2006, and agreed to pay the full amount of tax owed to the federal government for both tax years. At least $118,248.00 in taxable income for the tax year 2006 was not reported and at least $150,875.00 in taxable income for the tax year 2007 was not reported. The failure to report that taxable income led to an additional federal tax owing of $31,301.00 and $47,428.00, respectively, totaling $78,729.00. This figure does not include penalties and interest that may be assessed by the IRS, or taxes due and owing to New York State and the State of Pennsylvania.
The indictment resulted from an investigation conducted by the Internal Revenue Service. The case was prosecuted by Assistant United States Attorney Kevin P. Dooley of the Binghamton office. Inquiries can be directed to AUSA Dooley at (607) 773-2887.
Fulton County Man Sentenced for Producing and Possessing Child PornographyRead the Press Release
Sentenced to 720 Months in Prison
Albany, New York — NATHAN BROWN, age 33, of Fulton County, New York, was sentenced today by Chief United States District Court Judge Gary L. Sharpe, in Albany to 720 months of imprisonment and a lifetime period of supervised release for producing and possessing child pornography still images and videos, announced United States Attorney Richard S. Hartunian and Nick DiNicola, Assistant Special Agent in Charge of Homeland Security Investigations (HSI) Albany. BROWN, who had entered guilty pleas on June 19, 2012, was also ordered to pay restitution to his victims, forfeit various computer equipment, have no unsupervised contact with minors, and to register with the New York State Sex Offender Registry Program.
Between January 2010 and November 2011, BROWN produced still images and videos of three different children engaged in sexually explicit conduct. On March 9, 2012, pursuant to a federal search warrant, investigators searched BROWN’s residence and recovered several computers and smart phones. In addition to the child pornography images and videos actually produced by BROWN, over 150,000 still images and 1,500 videos containing child pornography, depicting children from throughout the nation, were recovered during the forensic examinations of the computer media seized.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched by the U.S. Department of Justice in May 2006 to protect children from online exploitation and abuse. Led by the United States Attorneys Offices, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. The goal of Project Safe Childhood is to enhance the national response to the growing threat to America’s youth posed by online sexual solicitation, abuse, and child pornography.
As technology improves and the Internet becomes more vast and accessible, the number of computer-facilitated sexual crimes against children continues to grow. According to one recent study, one in seven children, ages 10 to 17, who are regular Internet users, are sexually solicited online. That statistic translates to millions of kids at risk, and it suggests that there are thousands of offenders whom we have not yet identified and brought to justice. In order to address this problem, the Department of Justice initiated Project Safe Childhood which includes the following five core elements:
1. The creation of integrated partnerships of federal, state, and local law enforcement to investigate and prosecute offenders and identify, rescue, and assist victims;
2. Participation of these partnerships in coordinated national initiatives to pursue evidentiary leads sent out as a result of national operations;
3. Increased federal involvement in child exploitation cases so that all the resources of the federal government are brought to bear to ensure that investigations of online child exploitation crimes are effectively conducted and that offenders receive optimal punishment for their crimes;
4. Training of federal, state, and local law enforcement to ensure that law enforcement keeps up with technological advances; and
5. Increased efforts to raise community awareness and educate the public about the dangers facing children from sexual exploitation and abuse facilitated by technology.U.S. Attorney Richard S. Hartunian noted that, in the Northern District of New York, the U.S. Attorney’s Office and its federal, state, and local law enforcement partners are actively pursuing the various aspects of the Project Safe Childhood initiative. According to Mr. Hartunian, “these prosecutions, arising from joint investigations by federal and local law enforcement authorities, reflect our deep commitment to work together to target sexual abusers and pornographers who prey on the most innocent and vulnerable of our society–our children.”
Nick DiNicola, assistant special agent in charge of the HSI office in Albany, the office that led the investigation of BROWN, noted that “protecting children from dangerous sexual predators is one of HSI's highest priorities. Even commercial child pornography is not a victimless crime. Such crimes prey on the most vulnerable and innocent segment of society – our children.”
This case was investigated by Homeland Security Investigations, with assistance from members of the New York State Police, the National Center for Missing & Exploited Children (NCMEC), Customs & Border Protection Air Branch in Plattsburgh, N.Y., and HSI’s Cyber Crimes Center (C3) in Fairfax, Virginia.
LOCAL CONTACT:
Thomas Spina Jr.
Assistant U.S. Attorney
Tel: (518) 431-0247U. S. Attorney’s Office Collects $30.8 Million in Civil & Criminal Actions and Forfeitures in Fiscal Year 2012Read the Press Release
(Albany, New York) - United States Attorney Richard S. Hartunian announced today that the Northern District of New York collected a total of $30,811,828.88 in Fiscal Year (FY) 2012 in civil and criminal actions and forfeitures, comprised of $9,876,524.88 in criminal and civil actions and $20,935,304.00 in criminal, civil and administrative forfeitures. Of the $9,876,524.88, $2,715,873.25 was collected in criminal actions, as fines, restitution, and bail bond forfeitures, and $7,160,651.63 was collected in civil actions, as civil settlements, civil penalties, and defaulted loan recoveries.
Nationwide, the U.S. Attorneys’ Offices collected $13.16 billion in criminal and civil actions during FY 2012, more than doubling the $6.5 billion collected in FY 2011. A portion of this amount, $5.3 billion, was collected in shared cases involving more than one U.S. Attorney’s Office and/or Department of Justice litigating division. The $13.16 billion represents more than six times the appropriated budget of the combined 94 U.S. Attorney’s Offices for FY 2012.
“During these challenging economic times, collections are critically important,” said U.S. Attorney Richard S. Hartunian. “The U.S. Attorney’s Office is dedicated to protecting the public and recovering funds for the federal treasury and for victims of federal crime. We are also committed to holding accountable those who seek to profit from their illegal activities.”
Northern District of New York cases resulting in significant recoveries include the following:
A. Criminal Actions
In January of 2012, Lieze Associates, Inc., d/b/a Eagle Recycling, paid a criminal fine of $500,000 in connection with the unlawful disposal of millions of pounds of asbestos contaminated construction and demolition debris in a farmer's field in Frankfort, New York, from June through October of 2006. The owner of Eagle Recycling and his partner created a false New York State Department of Environmental Conservation permit to make it appear that the site was legal when it had nothing that a normal landfill would require, such as fences, scales, methods to capture and treat waste water runoff, intended sets backs from wetlands (and the Mohawk River), and hydro-geologic studies. Defendants included the principal Eagle operator, the landowner, the landfill operator, the owner of another recycling facility and his company from New Jersey (who also sent asbestos contaminated waste), and a waste broker who arranged for truckloads of material to be shipped. All defendants were convicted of conspiracy to violate the Clean Water Act and to commit mail fraud. Several others were convicted of obstruction of justice and making false statements to investigators.
B. Civil Actions
In February of 2012, the Northern District of New York recovered $2,000,000 as part of the settlement in the United States ex rel. Kuney v. Cablexpress Corp. (CXTEC) civil case. The settlement resolved allegations that CXTEC falsely represented where the computer parts it sold to the federal government had been manufactured. CXTEC signed a contract with the General Services Administration to provide computer parts, including cables and gigabit interface converters1 (GBICs), to the federal government. The contract was subject to the Trade Agreements Act, which requires that all products sold under it be manufactured in one of a list of designated countries. The settlement resolves allegations that CXTEC knowingly sold products to the United States from countries which are not on the designated list, such as China, a country that does not have reciprocal trade agreements with the United States. The settlement agreement also resolved allegations that CXTEC sold the government generic GBICs while falsely representing that they were name-brand GBICs.
In January of 2012, the Northern District of New York also recovered $3,576,056 as part of a settlement in the United States ex rel. Jorgenson v. Cayuga Medical Center, et. al. civil case. This settlement resolved a qui tam lawsuit alleging that Cayuga Medical Center recruited physicians into the local Ithaca area pursuant to recruitment agreements which violated a federal law known as the Stark Act. This law (42 U.S.C. §1395nn) applies to recruitment agreements between hospitals and physicians; it prohibits a physician from referring patients to a hospital if the physician has a financial relationship with the hospital, unless an exception applies. The Stark Act also prohibits a hospital from billing Medicare for a prohibited referral. Federal regulations and related guidelines do allow for hospitals to pay for certain expenses of medical practices who employ physicians recruited to the area by the hospital. However, the complaint alleged that Cayuga Medical Center recruited physicians to the area and paid for expenses that were not permitted by said regulations and guidelines, and improperly extended a physician recruitment agreement.
C. Forfeiture Cases
In November of 2012, the Northern District of New York forfeited approximately $11.28 million dollars in the case of United States v. Eric Canori. Canori pled guilty to participating in a conspiracy to distribute 100 or more kilograms of marijuana and was ultimately sentenced to 30 months imprisonment. The execution of search warrants at Canori’s residences in Wilton, New York, and Ross, California, resulted in seizures of currency, marijuana, and drug packaging. Subsequent investigation led to the recovery of precious metals, gold and silver, that were proceeds of the conspiracy. As part of his plea, Canori agreed to forfeit the currency and precious metals to the United States.
In April of 2012, the Northern District of New York collected $6,000,000 in forfeiture proceeds in the case of United States v. IFCO Systems North America (IFCO). IFCO, a Houston based company with a plant in Albany, New York, operated the largest pallet manufacturing company in the United States. The amount collected in April was part of a $20.7 million corporate settlement agreement, entered into in December of 2008, that resolved allegations that IFCO employed illegal aliens in its plants around the country.
The U.S. Attorneys’ Offices, along with the Department of Justice’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims. Statistics indicate that the aggregate amount collected nationally in federal criminal actions totaled $3.035 billion in restitution, criminal fines, and felony assessments. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid directly to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.
The statistics also indicate that a total of $10.12 billion was collected by the U.S. Attorneys’ Offices in individually and jointly handled civil actions. The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws. In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Departments of Housing and Urban Development, Health and Human Services, and Education, as well as the Internal Revenue Service and Small Business Administration.
Additionally, the U.S. Attorneys’ Offices, working with partner agencies and divisions, collected a total of $4.389 billion in asset forfeiture actions in FY 2012. Forfeited assets are deposited into the Department of Justice Assets Forfeiture Fund and Department of Treasury Forfeiture Fund and are used to restore funds to crime victims and for a variety of law enforcement purposes.
The $13.16 billion collected nationwide by the U.S. Attorneys’ offices for FY 2012 nearly matches the $13.18 billion collected in FY 2010 and FY 2011 combined.
For further information, the United States Attorneys’ Annual Statistical Reports can be found on the internet at http://www.justice.gov/usao/resources/annual-statistical-reports.
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1A gigabit interface converter 1 is a hot-swappable input/output device that plugs into a gigabit ethernet port or slot, linking the port with the network.
Lisle Man Admits to Serial Bank RobberiesRead the Press Release
Richard S. Hartunian, United States Attorney for the Northern District of New York; Peter J. Smith, United States Attorney, Middle District of Pennsylvania; George L. Piro, Acting Special Agent in Charge, Albany Division - Federal Bureau of Investigation; New York State Police Superintendent Joseph D’Amico; Joseph T. Zikuski, Chief, City of Binghamton Police Department; Carl Graziano, Acting Chief, City of Scranton Police Department; and, Larry Hurley, Chief, Athens Township Police Department, make the following announcement:
Samuel A. Parrotti, II, 44, of the Town of Lisle, Broome County, NY, admitted today in United States District Court, Binghamton, to committing a series of bank robberies last summer in Broome County, New York, Lackawanna County, Pennsylvania, and Bradford County, Pennsylvania. During his plea of guilty to four felony counts of bank robbery, Parrotti admitted to committing the following bank robberies in Broome County - the first, on July 16th, 2012, at the M&T Bank branch located at 1170 Vestal Avenue in the City of Binghamton; the second, on August 1st, 2012, at the NBT Bank branch located at 2950 State Route 11 in Whitney Point.
In addition, Parrotti admitted committing two other bank robberies similar to the Broome County robberies - one on August 6, 2012, at the Pennstar Bank branch located at 117 Meadow Avenue, Scranton, PA., and the other on August 27, 2012, at the Visions Federal Credit Union located at 2121 Elmira Street, Sayre, PA. In each of the four bank robberies, Parrotti indicated he possessed a gun, and passed notes to tellers demanding money. Parrotti obtained a total of approximately $38,000 between the four robberies.
Parrotti faces a maximum sentence of 20 years imprisonment, and a maximum fine of $250,000 dollars, on each of the four bank robberies. Parrotti is scheduled to be sentenced on May 23, 2013, by Senior U.S. District Court Judge Thomas J. McAvoy in United States District Court, Binghamton.
The case is being prosecuted by Assistant United States Attorney Thomas P. Walsh. Further inquiries may be directed to the United States Attorney’s Office, Binghamton branch office, at (607) 773-2887.
Two Plead Guilty in Federal Court to Illegally Manufacturing Cigarettes on the St. Regis Mohawk ReservationRead the Press Release
Richard S. Hartunian, United States Attorney, Northern District of New York, Eric T. Schneiderman, New York State Attorney General, and Joseph Anarumo, Jr., the Special-Agent-in- Charge of the New York Field Office of the United States Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) announced today that Robert C. Oliver, Sr., 53, of Burke, New York, and Jody Swamp, 48, of Hogansburg, New York, pled guilty in U.S. District Court in Utica, New York, to federal charges relating to illegally manufacturing cigarettes on the St. Regis Mohawk Reservation, known as Akwesasne. Each defendant pled guilty to one count charging Manufacturing Cigarettes Without Filing the Bond and Obtaining the Required Permit, in violation of 26 U.S.C. § 5762(a)(1) (Count 1), and one count charging Failure to Maintain Records Concerning the Shipment, Receipt, Sale, and Distribution of Cigarettes, in violation of 18 U.S.C. § 2343(a) (Count 2).
The pleas were entered before U.S. District Court Judge David N. Hurd. Count 1 carries a statutory maximum sentence of imprisonment for up to 5 years, a fine of up to $250,000, a term of supervised release of up to 3 years, and a special assessment of $100. Count 2 carries a statutory maximum sentence of imprisonment for up to three years, a fine of up to $250,000, a term of supervised release of up to three years, and a special assessment of $100. If the terms of the plea agreements signed by the defendants are accepted by the Court, each defendant will be sentenced to a term of imprisonment within the range of 24 to 30 months, to be followed by supervised release for 3 years, a fine of up to $250,000, forfeiture in the amount of $5,000,000 (with $1,000,000 to be paid by the time of sentencing), and a special assessment of $200. Sentencing is scheduled for August 3, 2013, before Judge Hurd in Utica, New York. The defendants were released on their own recognizance pending sentencing.
The defendants admitted that:
Between July of 2010 and October of 2011, the defendants manufactured cigarettes on Akwesasne without the required permit from the Alcohol and Tobacco Tax and Trade Bureau of the U.S. Department of the Treasury and failed to pay the federal excise tax of approximately $10 for each carton of cigarettes produced. The defendants had scores of shipments exceeding 10,000 cigarettes made to locations elsewhere in New York, and to Florida and Maine, all without complying with federal record-keeping requirements so they could evade payment of the federal excise tax. At least 2,556 cases totaling 76,680 cartons of unlicensed cigarettes were shipped from a property on Frogtown Road on Akwesasne. The $5,000,000 forfeiture represents the amount of profit realized by the defendants from their illegal cigarette manufacturing.United States Attorney Hartunian said, “Each year, the United States loses millions of dollars in federal excise taxes as a result of unlicensed cigarette manufacturing operations on Akwesasne. Manufacturers who do not pay their excise taxes have an unfair advantage over licensed manufacturers on and off Akwesasne, as they can charge lower prices and reap substantial extra profits. The U.S. Attorney’s Office will continue its work with federal and tribal authorities to bring unlicensed cigarette manufacturing operations on Akwesasne into compliance with federal regulations. We appreciate very much the cooperation and outstanding work in this case by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the New York State Attorney General’s Office.”
Attorney General Schneiderman said, “Illegally manufacturing tobacco products is a crime that hurts law abiding businesses and the health of our communities. These guilty pleas will bring accountability for a scheme that had many victims. I would like to thank U.S. Attorney Hartunian and our partners in law enforcement who have worked with us to root out this unlawful criminal enterprise. Together, we will remain vigilant to ensure there is one set of rules for everyone and that those rules are vigorously enforced.”
ATF Special-Agent-in-Charge Anarumo, Jr. said, “I would like to formally recognize United States Attorney Richard S. Hartunian and our federal, state and local law enforcement partners. This case demonstrates the cooperative efforts needed to combat large scale contraband tobacco trafficking. ATF remains committed to protecting the citizens of New York State. Our agency will continue to work together and in conjunction with the United States Attorney’s Office for the Northern District of New York to eliminate the illegal manufacture and distribution of tobacco products.”
The indictment resulted from an investigation conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives, with assistance from the Internal Revenue Service, U.S. Customs and Border Patrol, Immigration and Customs Enforcement, the New York State Police, and the Petroleum, Alcohol, and Tobacco Bureau of the New York State Department of Taxation and Finance. The case is being prosecuted by Assistant United States Attorney Kevin P. Dooley of the Binghamton office, and Assistant Attorney General Meryl Lutsky of the New York Attorney General’s Office, who was cross-designated as a Special Assistant U.S. Attorney for this case. Inquiries can be directed to AUSA Dooley at (607) 773-2887.
Tax Preparer Pleads Guilty to Preparing False Tax ReturnsRead the Press Release
Albany, New York —JAMES P. AIMI, age 65, of Ancram, New York, pled guilty on January 14, 2013 in United States District Court in Albany before Chief United States District Court Judge Gary L. Sharpe to twenty-four counts of aiding and assisting in the preparation and presentation of false and fraudulent U.S. income tax returns, announced United States Attorney Richard S. Hartunian and Toni M. Weirauch, Special Agent-in-Charge, Internal Revenue Service, New York Field Office.
AIMI admitted that between 2005 and 2008, he aided numerous taxpayers in the preparation of income tax returns for presentation to the Internal Revenue Service each of which was false and fraudulent, in that each return represented that the taxpayer was entitled to claim deductions that AIMI knew were false or exaggerated.
Sentencing was scheduled by Chief Judge Sharpe for May 7, 2013, at 11:00 a.m. in Albany, New York. Aimi faces a maximum sentence of three years of imprisonment on each of the twenty-four counts.
This case was investigated by the Internal Revenue Service.
LOCAL CONTACT:
Daniel Hanlon
Assistant U.S. Attorney
Tel: (518) 431-0247